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FORM 10-Q/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] Quarterly report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 For the quarterly period ended February 15, 1997,
or
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 For the transition period from _______ to ________.
Commission file number 1-10714
AUTOZONE, INC.
(Exact name of registrant as specified in its charter)
Nevada 62-1482048
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
123 South Front Street
Memphis, Tennessee 38103
(Address of principal executive offices) (Zip Code)
(901) 495-6500
Registrant's telephone number, including area code
(not applicable)
Former name, former address and former fiscal year,
if changed since last report.
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 periods 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 [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date.
Common Stock, $.01 Par Value -150,825,189 shares as of March 28, 1997
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Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
The following exhibits are filed as part of this report:
10.1 Credit Agreement dated as of December 20, 1996 among AutoZone,
Inc., as Borrower, the several lenders from time to time party hereto,
NationsBank, N.A., as Agent, and SunTrust Bank, Nashville, N.A. as Co-Agent.
(Portions of exhibit have been omitted pursuant to a request for confidential
treatment.)
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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.
AUTOZONE, INC.
By: /s/ Donald R. Rawlins
------------------------------------------
Donald R. Rawlins
Assistant Secretary
Customer Satisfaction
Dated: April 10, 1997
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EXHIBIT 10.1
CREDIT AGREEMENT
Dated as of December 20, 1996
among
AUTOZONE, INC.,
as Borrower,
THE SEVERAL LENDERS
FROM TIME TO TIME PARTY HERETO
AND
NATIONSBANK, N.A.,
as Agent
and
SUNTRUST BANK, NASHVILLE, N.A.,
as Co-Agent
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TABLE OF CONTENTS
SECTION 1 DEFINITIONS........................................................ 1
1.1 Definitions........................................................ 11
1.2 Computation of Time Periods........................................ 11
1.3 Accounting Terms................................................... 11
SECTION 2 CREDIT FACILITIES.................................................. 12
2.1 Revolving Loans.................................................... 12
2.2 Competitive Loan Subfacility....................................... 13
2.3 Swingline Loan Subfacility......................................... 15
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES..................... 17
3.1 Default Rate....................................................... 17
3.2 Extension and Conversion........................................... 17
3.3 Prepayments........................................................ 17
3.4 Termination, Reduction and Increase of Revolving Committed Amount.. 18
3.5 Fees .............................................................. 19
3.6 Capital Adequacy................................................... 20
3.7 Inability To Determine Interest Rate............................... 20
3.8 Illegality. ....................................................... 20
3.9 Yield Protection................................................... 20
3.10 Withholding Tax Exemption.......................................... 21
3.11 Indemnity. ........................................................ 22
3.12 Pro Rata Treatment................................................. 22
3.13 Sharing of Payments................................................ 23
3.14 Payments, Computations, Etc. ...................................... 23
3.15 Evidence of Debt................................................... 24
3.16 Replacement of Lenders............................................. 25
SECTION 4 CONDITIONS......................................................... 25
4.1 Closing Conditions................................................. 25
4.2 Conditions to all Extensions of Credit............................. 26
SECTION 5 REPRESENTATIONS AND WARRANTIES..................................... 27
5.1 Financial Condition................................................ 27
5.2 Organization; Existence; Compliance with Law....................... 27
5.3 Power; Authorization; Enforceable Obligations...................... 27
5.4 No Legal Bar....................................................... 27
5.5 No Material Litigation............................................. 28
5.6 No Default......................................................... 28
5.7 Ownership of Property; Liens....................................... 28
5.8 No Burdensome Restrictions......................................... 28
5.9 Taxes ............................................................. 28
5.10 ERISA ............................................................. 28
5.11 Governmental Regulations, Etc...................................... 29
5.12 Subsidiaries....................................................... 30
5.13 Purpose of Loans................................................... 30
SECTION 6 AFFIRMATIVE COVENANTS.............................................. 30
6.1 Information Covenants.............................................. 30
6.2 Preservation of Existence and Franchises........................... 32
6.3 Books and Records.................................................. 32
6.4 Compliance with Law................................................ 32
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6.5 Payment of Taxes and Other Indebtedness............................ 32
6.6 Insurance ......................................................... 32
6.7 Maintenance of Property............................................ 33
6.8 Use of Proceeds.................................................... 33
6.9 Audits/Inspections................................................. 33
6.10 Consolidated Leverage Ratio........................................ 33
SECTION 7 NEGATIVE COVENANTS................................................. 33
7.1 Liens. ............................................................ 33
7.2 Nature of Business................................................. 33
7.3 Consolidation, Merger, Sale or Purchase of Assets, etc. ........... 33
7.4 Fiscal Year........................................................ 34
SECTION 8 EVENTS OF DEFAULT.................................................. 34
8.1 Events of Default.................................................. 34
8.2 Acceleration; Remedies............................................. 35
SECTION 9 AGENCY PROVISIONS.................................................. 36
9.1 Appointment........................................................ 36
9.2 Delegation of Duties............................................... 36
9.3 Exculpatory Provisions............................................. 36
9.4 Reliance on Communications......................................... 37
9.5 Notice of Default.................................................. 37
9.6 Non-Reliance on Agent and Other Lenders............................ 38
9.7 Indemnification.................................................... 38
9.8 Agent in its Individual Capacity................................... 38
9.9 Successor Agent.................................................... 38
9.10 Co-Agent. ......................................................... 39
SECTION 10 MISCELLANEOUS...................................................... 39
10.1 Notices ........................................................... 39
10.2 Right of Set-Off................................................... 40
10.3 Benefit of Agreement............................................... 40
10.4 No Waiver; Remedies Cumulative..................................... 42
10.5 Payment of Expenses, etc........................................... 42
10.6 Amendments, Waivers and Consents................................... 42
10.7 Counterparts....................................................... 43
10.8 Headings .......................................................... 43
10.9 Survival. ......................................................... 43
10.10 Governing Law; Submission to Jurisdiction; Venue................... 43
10.11 Severability....................................................... 44
10.12 Entirety .......................................................... 44
10.13 Binding Effect; Termination........................................ 44
10.14 Confidentiality.................................................... 44
10.15 Source of Funds.................................................... 45
10.16 Conflict .......................................................... 45
SCHEDULES
Schedule 1.1A Investments
Schedule 2.1(a) Lenders
Schedule 2.1(b)(i)Form of Notice of Borrowing
Schedule 2.1(e) Form of Committed Revolving Note
Schedule 2.2(f) Form of Competitive Note
Schedule 2.3(d) Form of Swingline Note
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Schedule 3.2 Form of Notice of Extension/Conversion
Schedule 3.4(b) Form of New Commitment Agreement
Schedule 4.1(f) Form of Legal Opinion
Schedule 4.1(g) Form of Legal Opinion
Schedule 5.12 Subsidiaries
Schedule 6.1(c) Form of Officer's Compliance Certificate
Schedule 10.3(b) Form of Assignment and Acceptance
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT dated as of December 20, 1996 (the "Credit
Agreement"), is by and among AUTOZONE, INC., a Nevada corporation (the
"Borrower"), the several lenders identified on the signature pages hereto and
such other lenders as may from time to time become a party hereto (the
"Lenders"), NATIONSBANK, N.A., as agent for the Lenders (in such capacity, the
"Agent"), and SUNTRUST BANK, NASHVILLE, N.A., as Co-Agent (in such capacity,
the "Co-Agent").
W I T N E S S E T H
WHEREAS, the Borrower has requested that the Lenders provide a
$275,000,000 credit facility (as such credit facility may be increased or
decreased pursuant to the terms hereof) for the purposes hereinafter set forth;
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrower on the terms and conditions hereinafter set forth;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
1.1 DEFINITIONS.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Affiliate" means, with respect to any Person, any other Person (i)
directly or indirectly controlling or controlled by or under direct or
indirect common control with such Person or (ii) directly or indirectly
owning or holding five percent (5%) or more of the equity interest in
such Person. For purposes of this definition, "control" when used with
respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the
foregoing.
"Agency Services Address" means NationsBank, N.A., NC1-001-15-04,
101 North Tryon Street, Charlotte, North Carolina 28255, Attn: Agency
Services, or such other address as may be identified by written notice
from the Agent to the Borrower.
"Agent" shall have the meaning assigned to such term in the heading
hereof, together with any successors or assigns.
"Agent's Fee Letter" means that certain letter agreement, dated as
of December 20, 1996, between the Agent and the Borrower, as amended,
modified, supplemented or replaced from time to time.
"Agent's Fees" shall have the meaning assigned to such term in
Section 3.5(b).
"Applicable Percentage" means, for purposes of calculating the
applicable interest rate for any day for any Revolving Loan or the
applicable rate of the Facility Fee for any day for purposes of Section
3.5(a), the appropriate applicable percentage set forth on Schedule 1.1A.
The Applicable Percentages shall be determined and adjusted on the
following dates (each a "Calculation Date"):
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(i) where the Borrower has a senior unsecured (non-credit
enhanced) long term debt rating from both S&P and Moody's, five (5)
Business Days after receipt of notice by the Agent of a change in
any such debt rating, based on such debt ratings;
(ii) where the Borrower previously had a senior unsecured
(non-credit enhanced) long term debt rating from both S&P and
Moody's, but either or both of S&P and Moody's withdraws its
rating, five (5) Business Days after receipt by the Agent of notice
of the withdrawal of such debt rating, based on the information
contained in the most recent annual or quarterly financial
statements and related certificates provided in accordance with
Sections 6.1(a) and 6.1(b); and
(iii) five (5) Business Days after the date by which the
Borrower is required to provide the officer's certificate in
accordance with the provisions of Section 6.1(c).
The Applicable Percentage shall be effective from a Calculation Date
until the next such Calculation Date. The Agent shall determine the
appropriate Applicable Percentages promptly upon receipt of the notices
and information necessary to make such determination and shall promptly
notify the Borrower and the Lenders of any change thereof. Such
determinations by the Agent shall be conclusive absent manifest error.
The Applicable Percentage from Closing Date shall be based on Pricing
Level II, subject to adjustment as provided herein.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from time
to time.
"Bankruptcy Event" means, with respect to any Person, the occurrence
of any of the following with respect to such Person: (i) a court or
governmental agency having jurisdiction in the premises shall enter a
decree or order for relief in respect of such Person in an involuntary
case under any applicable bankruptcy, insolvency or other similar law now
or hereafter in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of such Person or
for any substantial part of its Property or ordering the winding up or
liquidation of its affairs; or (ii) there shall be commenced against such
Person an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or any case, proceeding or
other action for the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of such Person or
for any substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or other case,
proceeding or other action shall remain undismissed, undischarged or
unbonded for a period of sixty (60) consecutive days; or (iii) such
Person shall commence a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or consent to
the entry of an order for relief in an involuntary case under any such
law, or consent to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of such Person or for any substantial part of its Property or
make any general assignment for the benefit of creditors; or (iv) such
Person shall be unable to, or shall admit in writing its inability to,
pay its debts generally as they become due.
"Base Rate" means, for any day, the rate per annum (rounded upwards,
if necessary, to the nearest whole multiple of 1/100 of 1%) equal to the
greater of (a) the Federal Funds Rate in effect on such day plus 1/2 of
1% or (b) the Prime Rate in effect on such day. If for any reason the
Agent shall have determined (which determination shall be conclusive
absent manifest error) that it is unable after due inquiry to ascertain
the Federal Funds Rate for any reason, including the inability or failure
of the Agent to obtain sufficient quotations in accordance with the terms
hereof, the Base Rate shall be determined without regard to clause (a) of
the first sentence of this definition until the circumstances giving rise
to such inability no longer exist. Any change in the Base Rate due to a
change in the Prime Rate or the Federal Funds Rate shall be effective on
the effective date of such change in the Prime Rate or the Federal Funds
Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate
determined by reference to the Base Rate.
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"Borrower" means the Person identified as such in the heading
hereof, together with any permitted successors and assigns.
"Business Day" means a day other than a Saturday, Sunday or other
day on which commercial banks in New York, New York are authorized or
required by law to close, except that, when used in connection with a
Eurodollar Loan, such day shall also be a day on which dealings between
banks are carried on in U.S. dollar deposits in London, England and New
York, New York.
"Calculation Date" has the meaning set forth in the definition of
Applicable Percentage.
"Capital Lease" means, as applied to any Person, any lease of any
Property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a
capital lease on the balance sheet of that Person.
"Closing Date" means the date hereof.
"Co-Agent" shall have the meaning assigned to such term in the
heading hereof, together with any successors or assigns.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, as interpreted by the rules and regulations
issued thereunder, in each case as in effect from time to time.
References to sections of the Code shall be construed also to refer to
any successor sections.
"Commitment" means (i) with respect to each Lender, the Revolving
Commitment of such Lender and (ii) with respect to the Swingline Lender,
the Swingline Commitment.
"Commitment Percentage" means, for any Lender, the percentage which
such Lender's Revolving Commitment then constitutes of the aggregate
Revolving Committed Amount.
"Competitive Bid" means an offer by a Lender to make a Competitive
Loan pursuant to the terms of Section 2.2.
"Competitive Bid Rate" means, as to any Competitive Bid made by a
Lender in accordance with the provisions of Section 2.2, the fixed rate
of interest offered by the Lender making the Competitive Bid.
"Competitive Loan" means a loan made by a Lender in its discretion
pursuant to the provisions of Section 2.2.
"Competitive Note" means a promissory note of the Borrower in favor
of a Lender delivered pursuant to Section 2.2(f) and evidencing the
Competitive Loans, if any, of such Lender, as such promissory note may be
amended, modified, restated or replaced from time to time.
"Consolidated Capitalization" means, at any time, the sum of (i)
Consolidated Net Worth at such time plus (ii) Consolidated Funded
Indebtedness at such time.
"Consolidated Funded Indebtedness" means, at any time, the
outstanding principal amount of all Funded Indebtedness, without
duplication, of the Borrower and its Subsidiaries at such time.
"Consolidated Leverage Ratio" means, as of the last day of any
fiscal quarter of the Borrower, the ratio of (i) Consolidated Funded
Indebtedness as of such date to (ii) Consolidated Capitalization as of
such date.
"Consolidated Net Worth" means, as of any date, total shareholders'
equity of the Borrower and its Subsidiaries as of such date, as
determined in accordance with GAAP.
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"Credit Documents" means a collective reference to this Credit
Agreement, the Notes, the Agent's Fee Letter, and all other related
agreements and documents issued or delivered hereunder or thereunder or
pursuant hereto or thereto.
"Default" means any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Dollars" and "$" means dollars in lawful currency of the United
States of America.
"Environmental Laws" means any and all lawful and applicable
Federal, state, local and foreign statutes, laws, regulations,
ordinances, rules, judgments, orders, decrees, permits, concessions,
grants, franchises, licenses, agreements or other governmental
restrictions relating to the environment or to emissions, discharges,
releases or threatened releases of pollutants, contaminants, chemicals,
or industrial, toxic or hazardous substances or wastes into the
environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport,
or handling of pollutants, contaminants, chemicals, or industrial, toxic
or hazardous substances or wastes.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended, and any successor statute thereto, as interpreted by the
rules and regulations thereunder, all as the same may be in effect from
time to time. References to sections of ERISA shall be construed also to
refer to any successor sections.
"ERISA Affiliate" means an entity which is under common control with
the Borrower within the meaning of Section 4001(a)(14) of ERISA, or is a
member of a group which includes the Borrower and which is treated as a
single employer under Sections 414(b) or (c) of the Code.
"ERISA Event" means (i) with respect to any Plan, the occurrence of
a Reportable Event or the substantial cessation of operations (within the
meaning of Section 4062(e) of ERISA); (ii) the withdrawal by the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate from a
Multiple Employer Plan during a plan year in which it was a substantial
employer (as such term is defined in Section 4001(a)(2) of ERISA), or the
termination of a Multiple Employer Plan; (iii) the distribution of a
notice of intent to terminate or the actual termination of a Plan
pursuant to Section 4041(a)(2) or 4041A of ERISA; (iv) the institution of
proceedings to terminate or the actual termination of a Plan by the PBGC
under Section 4042 of ERISA; (v) any event or condition which could
reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer,
any Plan; (vi) the complete or partial withdrawal of the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate from a Multiemployer
Plan; (vii) the conditions for imposition of a lien under Section 302(f)
of ERISA exist with respect to any Plan; or (vii) the adoption of an
amendment to any Plan requiring the provision of security to such Plan
pursuant to Section 307 of ERISA.
"Eurodollar Loan" means any Loan bearing interest at a rate
determined by reference to the Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each Eurodollar
Loan comprising part of the same borrowing (including conversions,
extensions and renewals), a per annum interest rate determined pursuant
to the following formula:
Eurodollar Rate = Interbank Offered Rate
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1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means for any day, that percentage
(expressed as a decimal) which is in effect from time to time under
Regulation D of the Board of Governors of the Federal Reserve System (or
any successor), as such regulation may be amended from time to time or
any successor regulation, as the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special, or
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marginal reserves) applicable with respect to Eurocurrency liabilities as
that term is defined in Regulation D (or against any other category of
liabilities that includes deposits by reference to which the interest
rate of Eurodollar Loans is determined), whether or not Lender has any
Eurocurrency liabilities subject to such reserve requirement at that
time. Eurodollar Loans shall be deemed to constitute Eurocurrency
liabilities and as such shall be deemed subject to reserve requirements
without benefits of credits for proration, exceptions or offsets that may
be available from time to time to a Lender. The Eurodollar Rate shall be
adjusted automatically on and as of the effective date of any change in
the Eurodollar Reserve Percentage.
"Event of Default" means such term as defined in Section 8.1.
"Existing Credit Agreements" means, collectively, (i) that certain
Revolving Credit Loan Agreement, dated as of January 16, 1996, by and
between the Borrower and NationsBank, (ii) that certain Revolving Credit
Loan Agreement, dated as of February 1, 1995, by and between the Borrower
and United States National Bank of Oregon, (iii) that certain Revolving
Credit Loan Agreement, dated as of February 1, 1995, by and between the
Borrower and Bank of America Illinois, (iv) that certain Revolving Credit
Loan Agreement, dated as of February 1, 1995, by and between the Borrower
and First Tennessee Bank National Association, (v) that certain Revolving
Credit Loan Agreement, dated as of February 1, 1995, by and between the
Borrower and SunTrust Bank, Nashville, N.A. (formerly Third National Bank
in Nashville) and (vi) that certain Revolving Credit Loan Agreement,
dated as of January 16, 1996, by and between the Borrower and The First
National Bank of Chicago, as such agreements have been amended, modified,
supplemented or replaced from time to time.
"Facility Fee" shall have the meaning assigned to such term in
Section 3.5(a).
"Facility Fee Calculation Period" shall have the meaning assigned to
such term in Section 3.5(a).
"Fees" means all fees payable pursuant to Section 3.5.
"Federal Funds Rate" means, for any day, the rate of interest per
annum (rounded upwards, if necessary, to the nearest whole multiple of
1/100 of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided that (A) if such day is not a Business Day, the Federal
Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day and (B) if no such rate is so published on
such next preceding Business Day, the Federal Funds Rate for such day
shall be the average rate quoted to the Agent on such day on such
transactions as determined by the Agent.
"Financial Officer" means, with respect to the Borrower, the
Treasurer, the Chief Accounting Officer, the General Counsel or the Chief
Financial Officer of the Borrower; provided that the Borrower may
designate additional persons or delete persons so authorized by written
notice to the Agent from at least two existing Financial Officers of the
Borrower.
"Funded Indebtedness" means, with respect to any Person (for
purposes of this sentence only, the "Debtor"), without duplication, (i)
all Indebtedness of such Debtor for borrowed money, (ii) all purchase
money Indebtedness of such Debtor, including without limitation the
principal portion of all obligations of such Debtor under Capital Leases,
(iii) all Guaranty Obligations of such Debtor with respect to Funded
Indebtedness of another Person, (iv) the maximum available amount of all
standby letters of credit or acceptances issued or created for the
account of such Debtor, (v) all Funded Indebtedness of another Person
secured by a Lien on any Property of such Debtor, whether or not such
Funded Indebtedness has been assumed, and (vi) the principal balance
outstanding under any synthetic lease, tax retention operating lease,
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off-balance sheet loan or similar off-balance sheet financing product to
which such Debtor is a party, where such transaction is considered
borrowed money indebtedness for tax purposes but is classified as an
operating lease in accordance with GAAP; provided that Funded
Indebtedness shall not include (i) any letters of credit used by such
Debtor for the financing of inventory in the ordinary course of business
or (ii) any amounts received by such Debtor pursuant to the GECC Credit
Arrangement. The Funded Indebtedness of any Person shall include the
Funded Indebtedness of any partnership or joint venture in which such
Person is a general partner or joint venturer.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of Section
1.3 hereof.
"GECC Credit Arrangement" means the Business Revolving Charge and
Commercial Program Agreement, dated September 14, 1995, by and between
the Borrower and General Electric Capital Corporation, together with any
document executed in replacement therefor.
"Governmental Authority" means any Federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory
body.
"Guaranty Obligations" means, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in
the ordinary course of business of negotiable instruments for deposit or
collection) guaranteeing or intended to guarantee any Indebtedness of any
other Person in any manner, whether direct or indirect, and including
without limitation any obligation, whether or not contingent, (i) to
purchase any such Indebtedness or any Property constituting security
therefor, (ii) to advance or provide funds or other support for the
payment or purchase of any such Indebtedness or to maintain working
capital, solvency or other balance sheet condition of such other Person
(including without limitation keep well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for
the benefit of any holder of Indebtedness of such other Person, (iii) to
lease or purchase Property, securities or services primarily for the
purpose of assuring the holder of such Indebtedness, or (iv) to otherwise
assure or hold harmless the holder of such Indebtedness against loss in
respect thereof. The amount of any Guaranty Obligation hereunder shall
(subject to any limitations set forth therein) be deemed to be an amount
equal to the outstanding principal amount (or maximum principal amount,
if larger) of the Indebtedness in respect of which such Guaranty
Obligation is made.
"Indebtedness" of any Person means (i) all obligations of such
Person for borrowed money, (ii) all obligations of such Person evidenced
by bonds, debentures, notes or similar instruments, or upon which interest
payments are customarily made, (iii) all obligations of such Person under
conditional sale or other title retention agreements relating to Property
purchased by such Person (other than customary reservations or retentions
of title under agreements with suppliers entered into in the ordinary
course of business), (iv) all obligations of such Person issued or assumed
as the deferred purchase price of Property or services purchased by such
Person (other than trade debt incurred in the ordinary course of business
and due within six months of the incurrence thereof) which would appear as
liabilities on a balance sheet of such Person, (v) all obligations of such
Person under take-or-pay or similar arrangements or under commodities
agreements, (vi) all Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the proceeds
of production from, Property owned or acquired by such Person, whether or
not the obligations secured thereby have been assumed, (vii) all Guaranty
Obligations of such Person, (viii) the principal portion of all
obligations of such Person under Capital Leases, (ix) all obligations of
such Person in respect of interest rate protection agreements, foreign
currency exchange agreements, commodity purchase or option agreements or
other interest or exchange rate or commodity price hedging agreements, (x)
the maximum amount of all standby letters of credit issued or bankers'
acceptances facilities created for the account of such Person and, without
duplication, all drafts drawn thereunder (to the extent unreimbursed),
(xi) all preferred stock issued by such Person and required by the terms
thereof to be redeemed, or for which mandatory sinking fund payments are
due, by a fixed date and (xii) the principal balance outstanding under any
synthetic lease, tax retention operating lease, off-balance sheet loan or
similar off-balance sheet financing product to which such Person is a
party, where such transaction is considered borrowed money indebtedness
for tax purposes but is classified as an operating lease in accordance
with GAAP; provided that Indebtedness shall not include (i) any letters of
credit used by such Person for the financing of inventory in the ordinary
course of business or (ii) any amounts received by such Person pursuant to
the GECC Credit Arrangement The Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person
is a general partner or a joint venturer.
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11
"Interbank Offered Rate" means, for the Interest Period for each
Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%)
equal to the rate of interest, determined by the Agent on the basis of
the offered rates for deposits in dollars for a period of time
corresponding to such Interest Period (and commencing on the first day of
such Interest Period), appearing on Telerate Page 3750 (or, if, for any
reason, Telerate Page 3750 is not available, the Reuters Screen LIBO
Page) as of approximately 11:00 A.M. (London time) two (2) Business Days
before the first day of such Interest Period. As used herein, "Telerate
Page 3750" means the display designated as page 3750 by Dow Jones
Telerate, Inc. (or such other page as may replace such page on that
service for the purpose of displaying the British Bankers Association
London interbank offered rates) and "Reuters Screen LIBO Page" means the
display designated as page "LIBO" on the Reuters Monitor Money Rates
Service (or such other page as may replace the LIBO page on that service
for the purpose of displaying London interbank offered rates of major
banks).
"Interest Payment Date" means (i) as to any Base Rate Loan, the last
day of each March, June, September and December, the date of repayment of
principal of such Loan and the Termination Date and (ii) as to any
Eurodollar Loan, any Competitive Loan or any Swingline Loan, the last day
of each Interest Period for such Loan, the date of repayment of principal
of such Loan and on the Termination Date, and in addition where the
applicable Interest Period is more than 3 months, then also on the date 3
months from the beginning of the Interest Period, and each 3 months
thereafter. If an Interest Payment Date falls on a date which is not a
Business Day, such Interest Payment Date shall be deemed to be the next
succeeding Business Day, except that in the case of Eurodollar Loans
where the next succeeding Business Day falls in the next succeeding
calendar month, then on the next preceding Business Day.
"Interest Period" means (i) as to any Eurodollar Loan, a period of
one, two, three or six month's duration, as the Borrower may elect,
commencing in each case, on the date of the borrowing (including
conversions, extensions and renewals), (ii) as to any Competitive Loan, a
period commencing in each case on the date of the borrowing and ending on
the date specified in the applicable Competitive Bid whereby the offer to
make such Competitive Loan was extended (such ending date in any event to
be not more than 180 days from the date of the borrowing) and (iii) as to
any Swingline Loan, a period commencing in each case on the date of the
borrowing and ending on the date agreed to by the Borrower and the
Swingline Lender in accordance with the provisions of Section 2.3(b)(i)
(such ending date in any event to be not more than seven (7) Business
Days from the date of borrowing); provided, however, (A) if any Interest
Period would end on a day which is not a Business Day, such Interest
Period shall be extended to the next succeeding Business Day (except that
in the case of Eurodollar Loans where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding
Business Day), (B) no Interest Period shall extend beyond the Termination
Date, and (C) in the case of Eurodollar Loans, where an Interest Period
begins on a day for which there is no numerically corresponding day in
the calendar month in which the Interest Period is to end, such Interest
Period shall end on the last day of such calendar month.
"Lenders" means each of the Persons identified as a "Lender" on the
signature pages hereto, and each Person which may become a Lender by way
of assignment in accordance with the terms hereof, together with their
successors and permitted assigns.
"Lending Installation" means, with respect to a Lender or the Agent,
any office, branch, subsidiary or affiliate of such Lender or the Agent.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference, priority or charge of any kind (including any
agreement to give any of the foregoing, any conditional sale or other
title retention agreement, any financing or similar statement or notice
filed under the Uniform Commercial Code as adopted and in effect in the
relevant jurisdiction or other similar recording or notice statute, and
any lease in the nature thereof).
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12
"Loan" or "Loans" means the Revolving Loans, the Competitive Loans
and/or the Swingline Loans (or any Swingline Loan bearing interest at the
Base Rate or the Quoted Rate and referred to as a Base Rate Loan or a
Quoted Rate Swingline Loan), individually or collectively, as
appropriate.
"Master Account" means the AutoZone, Inc. Master Account, account
no.[CONFIDENTIAL PORTION OMITTED AND FILED SEPARATELY WITH THE
COMMISSION], or such other account as may be identified by written notice
from at least two Financial Officers of the Borrower to the Agent.
"Material Adverse Effect" means a material adverse effect on the
Borrower's ability to carry on its business as now conducted or its
ability to carry out its obligations under the Credit Documents.
"Materials of Environmental Concern" means any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or
any hazardous or toxic substances, materials or wastes, defined or
regulated as such in or under any Environmental Laws, including, without
limitation, asbestos, polychlorinated biphenyls and urea-formaldehyde
insulation.
"Moody's" means Moody's Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating
securities.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
defined in Sections 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate and at least one
employer other than the Borrower, any Subsidiary of the Borrower or any
ERISA Affiliate are contributing sponsors.
"NationsBank" means NationsBank, N.A. and its successors.
"New Commitment Agreement" means a New Commitment Agreement
substantially in the form of Schedule 3.4(b), as executed pursuant to
Section 3.4(b).
"Note" or "Notes" means any Revolving Note, any Competitive Note or
the Swingline Note, as the context may require.
"Notice of Borrowing" means a written notice of borrowing in
substantially the form of Schedule 2.1(b)(i), as required by Section
2.1(b)(i).
"Notice of Extension/Conversion" means the written notice of
extension or conversion in substantially the form of Schedule 3.2, as
required by Section 3.2.
"Participation Interest" means, the extension of credit by a Lender
by way of a purchase of a participation in any Swingline Loans as
provided in Section 2.3(b)(iii) or in any Loans as provided in Section
3.13.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereof.
"Permitted Liens" means:
(i) Liens in favor of the Agent on behalf of the Lenders;
(ii) Liens (other than Liens created or imposed under ERISA)
for taxes, assessments or governmental charges or levies not yet
due or Liens for taxes being contested in good faith by appropriate
proceedings for which adequate reserves determined in accordance
with GAAP have been
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13
established (and as to which the Property subject to any such Lien
is not yet subject to foreclosure, sale or loss on account thereof);
(iii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and suppliers and other Liens
imposed by law or pursuant to customary reservations or retentions
of title arising in the ordinary course of business, provided that
any such Liens which are material secure only amounts not yet due
and payable or, if due and payable, are unfiled and no other action
has been taken to enforce the same or are being contested in good
faith by appropriate proceedings for which adequate reserves
determined in accordance with GAAP have been established (and as to
which the Property subject to any such Lien is not yet subject to
foreclosure, sale or loss on account thereof);
(iv) Liens (other than Liens created or imposed under ERISA)
incurred or deposits made by the Borrower and its Subsidiaries in
the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory
obligations, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(v) Liens in connection with attachments or judgments
(including judgment or appeal bonds) provided that the judgments
secured shall, within 30 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall
have been discharged within 30 days after the expiration of any
such stay;
(vi) easements, rights-of-way, restrictions (including zoning
restrictions), minor defects or irregularities in title and other
similar charges or encumbrances not, in any material respect,
impairing the use of the encumbered Property for its intended
purposes;
(vii) leases or subleases granted to others not interfering in
any material respect with the business of the Borrower and its
Subsidiaries taken as a whole;
(viii) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with the importation of goods;
(ix) Liens on assets at the time such assets are acquired by
the Borrower or any Subsidiary in accordance with Section 7.3(d);
provided that such Liens are not created in contemplation of such
acquisition;
(x) Liens on assets of any Person at the time such Person
becomes a Subsidiary in accordance with Section 7.3(d); provided
that such Liens are not created in contemplation of such Person
becoming a Subsidiary;
(xi) normal and customary rights of setoff upon deposits of
cash in favor of banks or other depository institutions;
(xii) Liens on receivables sold pursuant to the GECC Credit
Arrangement;
(xiii) Liens on inventory held by the Borrower or any of its
Subsidiaries under consignment;
(xiv) Liens on any inventory of the Borrower or any of its
Subsidiaries in favor of a vendor of such inventory, arising in the
normal course of business upon its sale to the Borrower or any such
Subsidiary; and
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14
(xv) other Liens on Property of the Borrower and its
Subsidiaries to the extent that (a) with respect to Property
existing as of the date hereof (including Property acquired to
replace Property existing on the date hereof and Property acquired
from the sale or refinancing of Property existing on the date
hereof), the aggregate fair market value of such Property does not
exceed $100,000,000 and (b) with respect to Property acquired after
the date hereof, such Property shall have been acquired in the
ordinary course of business.
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other
enterprise (whether or not incorporated) or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3)
of ERISA) which is covered by ERISA and with respect to which the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate is (or,
if such plan were terminated at such time, would under Section 4069 of
ERISA be deemed to be) an "employer" within the meaning of Section 3(5)
of ERISA.
"Pricing Level" means the applicable pricing Level for the
Applicable Percentage shown in Schedule 1.1A.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by NationsBank as its prime rate in effect at its
principal office in Charlotte, North Carolina, with each change in the
Prime Rate being effective on the date such change is publicly announced
as effective (it being understood and agreed that the Prime Rate is a
reference rate used by NationsBank in determining interest rates on
certain loans and is not intended to be the lowest rate of interest
charged on any extension of credit by NationsBank to any debtor).
"Property" means any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"Quoted Rate" means, with respect to any Quoted Rate Swingline Loan,
the fixed percentage rate per annum offered by the Swingline Lender and
accepted by the Borrower with respect to such Swingline Loan as provided
in accordance with the provisions of Section 2.3.
"Quoted Rate Swingline Loan" means a Swingline Loan bearing interest
at a Quoted Rate.
"Register" shall have the meaning given such term in Section
10.3(c).
"Regulation D, G, T, U, or X" means Regulation D, G, T, U or X,
respectively, of the Board of Governors of the Federal Reserve System as
from time to time in effect and any successor to all or a portion
thereof.
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or
disposing into the environment (including the abandonment or discarding
of barrels, containers and other closed receptacles containing any
Materials of Environmental Concern).
"Reportable Event" means any of the events set forth in Section
4043(c) of ERISA, other than those events as to which the notice
requirement has been waived by regulation.
"Required Lenders" means, at any time, Lenders which are then in
compliance with their obligations hereunder (as determined by the Agent)
and holding in the aggregate at least 51% of (i) the Commitment
Percentages or (ii) if the Commitments have been terminated, the
outstanding Loans and Participation Interests.
"Requirement of Law" means, as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents
of such Person, and any law, treaty, rule or regulation or determination
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15
of an arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its material property
is subject.
"Revolving Commitment" means, with respect to each Lender, the
commitment of such Lender in an aggregate principal amount at any time
outstanding not to exceed the amount set forth opposite such Lender's
name on Schedule 2.1(a) (as such amount may be reduced or increased from
time to time in accordance with the provisions of this Credit Agreement),
(i) to make Revolving Loans in accordance with the provisions of Section
2.1(a) and (ii) to purchase participation interests in the Swingline
Loans in accordance with the provisions of Section 2.3(b)(iii).
"Revolving Committed Amount" shall have the meaning assigned to such
term in Section 2.1(a).
"Revolving Loans" shall have the meaning assigned to such term in
Section 2.1(a).
"Revolving Note" means a promissory note of the Borrower in favor of
a Lender delivered pursuant to Section 2.1(e) and evidencing the
Revolving Loans of such Lender, as such promissory note may be amended,
modified, restated or replaced from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., or any successor or assignee of the business of such division
in the business of rating securities.
"Single Employer Plan" means any Plan which is covered by Title IV
of ERISA, but which is not a Multiemployer Plan or a Multiple Employer
Plan.
"Subsidiary" means, as to any Person, (a) any corporation more than
50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time, any class or
classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by such
Person directly or indirectly through Subsidiaries, and (b) any
partnership, association, joint venture or other entity in which such
Person directly or indirectly through Subsidiaries has more than 50%
equity interest at any time.
"Swingline Commitment" means the commitment of the Swingline Lender
to make Swingline Loans in an aggregate principal amount at any time
outstanding of up to the Swingline Committed Amount.
"Swingline Committed Amount" shall have the meaning assigned to such
term in Section 2.3(a).
"Swingline Lender" means NationsBank.
"Swingline Loan" shall have the meaning assigned to such term in
Section 2.3(a).
"Swingline Note" means the promissory note of the Borrower in favor
of the Swingline Lender in the original principal amount of $25,000,000,
as such promissory note may be amended, modified, restated or replaced
from time to time.
"Termination Date" means December 20, 2001.
1.2 COMPUTATION OF TIME PERIODS.
For purposes of computation of periods of time hereunder, the word "from"
means "from and including" and the words "to" and "until" each mean "to but
excluding."
1.3 ACCOUNTING TERMS.
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16
Except as otherwise expressly provided herein, all accounting terms used
herein shall be interpreted, and all financial statements and certificates and
reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 6.1
hereof (or, prior to the delivery of the first financial statements pursuant to
Section 6.1 hereof, consistent with the financial statements as at August 31,
1996); provided, however, if (a) the Borrower shall object to determining such
compliance on such basis at the time of delivery of such financial statements
due to any change in GAAP or the rules promulgated with respect thereto or (b)
the Agent or the Required Lenders shall so object in writing within 30 days
after delivery of such financial statements, then such calculations shall be
made on a basis consistent with the most recent financial statements delivered
by the Borrower to the Lenders as to which no such objection shall have been
made.
SECTION 2
CREDIT FACILITIES
2.1 REVOLVING LOANS.
(a) Revolving Commitment. Subject to the terms and conditions
hereof and in reliance upon the representations and warranties set forth
herein, each Lender severally agrees to make available to the Borrower
revolving credit loans requested by the Borrower in Dollars ("Revolving
Loans") up to such Lender's Revolving Commitment from time to time from
the Closing Date until the Termination Date, or such earlier date as the
Revolving Commitments shall have been terminated as provided herein for
the purposes hereinafter set forth; provided, however, that the sum of
the aggregate principal amount of outstanding Revolving Loans shall not
exceed TWO HUNDRED SEVENTY-FIVE MILLION DOLLARS ($275,000,000.00) (as
such aggregate maximum amount may be reduced or increased from time to
time as provided in Section 3.4, the "Revolving Committed Amount");
provided, further, (i) with regard to each Lender individually, such
Lender's outstanding Revolving Loans shall not exceed such Lender's
Revolving Commitment, and (ii) with regard to the Lenders collectively,
the aggregate principal amount of outstanding Revolving Loans plus the
aggregate principal amount of outstanding Competitive Loans plus the
aggregate principal amount of outstanding Swingline Loans shall not
exceed the Revolving Committed Amount. Revolving Loans may consist of
Base Rate Loans or Eurodollar Loans, or a combination thereof, as the
Borrower may request, and may be repaid and reborrowed in accordance with
the provisions hereof; provided, however, that no more than 25
Eurodollar Loans shall be outstanding hereunder at any time. For
purposes hereof, Eurodollar Loans with different Interest Periods shall
be considered as separate Eurodollar Loans, even if they begin on the
same date, although borrowings, extensions and conversions may, in
accordance with the provisions hereof, be combined at the end of existing
Interest Periods to constitute a new Eurodollar Loan with a single
Interest Period. Revolving Loans hereunder may be repaid and reborrowed
in accordance with the provisions hereof.
(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrower shall request a
Revolving Loan borrowing by written notice (or telephone notice
promptly confirmed in writing) to the Agent not later than 11:30
A.M. (Charlotte, North Carolina time) on the Business Day of the
requested borrowing in the case of Base Rate Loans, and not later
than 2:00 P.M. (Charlotte, North Carolina time) on the third
Business Day prior to the date of the requested borrowing in the
case of Eurodollar Loans. Each such request for borrowing shall be
irrevocable, executed by a Financial Officer of the Borrower and
shall specify (A) that a Revolving Loan is requested, (B) the date
of the requested borrowing (which shall be a Business Day), (C) the
aggregate principal amount to be borrowed, and (D) whether the
borrowing shall be comprised of Base Rate Loans, Eurodollar Loans or
a combination thereof, and if Eurodollar Loans are requested, the
Interest Period(s) therefor. If the Borrower shall fail to specify
in any such Notice of Borrowing (I) an applicable Interest Period in
the case of a Eurodollar Loan, then such
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17
notice shall be deemed to be a request for an Interest Period of one
month, or (II) the type of Revolving Loan requested, then such
notice shall be deemed to be a request for a Base Rate Loan
hereunder. The Agent shall give notice to each affected Lender
promptly upon receipt of each Notice of Borrowing pursuant to this
Section 2.1(b)(i), the contents thereof and each such Lender's share
of any borrowing to be made pursuant thereto.
(ii) Minimum Amounts. Each Eurodollar Loan or Base Rate Loan
that is a Revolving Loan shall be in a minimum aggregate principal
amount of $5,000,000 and integral multiples of $1,000,000 in excess
thereof (or the remaining amount of the Revolving Committed Amount,
if less).
(iii) Advances. Each Lender will make its Commitment
Percentage of each Revolving Loan borrowing available to the Agent
for the account of the Borrower as specified in Section 3.14(a), or
in such other manner as the Agent may specify in writing, by 1:00
P.M. (Charlotte, North Carolina time) on the date specified in the
applicable Notice of Borrowing in Dollars and in funds immediately
available to the Agent. Such borrowing will then be made available
to the Borrower by the Agent by crediting the Master Account with
the aggregate of the amounts made available to the Agent by the
Lenders and in like funds as received by the Agent.
(c) Repayment. The principal amount of all Revolving Loans shall be
due and payable in full on the Termination Date.
(d) Interest. Subject to the provisions of Section 3.1,
(i) Base Rate Loans. During such periods as Revolving Loans
shall be comprised in whole or in part of Base Rate Loans, such
Base Rate Loans shall bear interest at a per annum rate equal to
the Base Rate plus the Applicable Percentage;
(ii) Eurodollar Loans. During such periods as Revolving Loans
shall be comprised in whole or in part of Eurodollar Loans, such
Eurodollar Loans shall bear interest at a per annum rate equal to
the Eurodollar Rate plus the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each
applicable Interest Payment Date (or at such other times as may be
specified herein).
(e) Revolving Notes. The Revolving Loans made by each Lender shall
be evidenced by a duly executed promissory note of the Borrower to such
Lender in an original principal amount equal to such Lender's Revolving
Commitment and in substantially the form of Schedule 2.1(e).
2.2 COMPETITIVE LOAN SUBFACILITY.
(a) Competitive Loans. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, the
Borrower may, from time to time from the Closing Date until the
Termination Date, request and each Lender may, in its sole discretion,
agree to make, Competitive Loans in Dollars to the Borrower; provided,
however, that (i) the aggregate principal amount of outstanding
Competitive Loans shall not at any time exceed the Revolving Committed
Amount, and (ii) the sum of the aggregate principal amount of outstanding
Revolving Loans plus the aggregate principal amount of outstanding
Competitive Loans plus the aggregate principal amount of outstanding
Swingline Loans shall not at any time exceed the Revolving Committed
Amount. Each Competitive Loan shall be not less than $5,000,000 in the
aggregate and integral multiples of $1,000,000 in excess thereof (or the
remaining portion of the Revolving Committed Amount, if less).
(b) Competitive Bid Requests. The Borrower may solicit by making a
written or telefax request to all of the Lenders for a Competitive Loan.
To be effective, such request must be received by each of the Lenders by
such time as determined by each such Lender in accordance with such
Lender's customary practices
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18
(in any event not to be later than 2:00 P.M. (Charlotte, North Carolina
time)) one Business Day prior to the date of the requested borrowing and
must specify (i) that a Competitive Loan is requested, (ii) the amount of
such Competitive Loan and (iii) the Interest Period for such Competitive
Loan.
(c) Competitive Bids. Upon receipt of a request by the Borrower for
a Competitive Loan, each Lender may, in its sole discretion, submit a
Competitive Bid containing an offer to make a Competitive Loan in an
amount up to the amount specified in the related request for Competitive
Loans. Such Competitive Bid shall be submitted to the Borrower by
telephone notice (to be immediately confirmed by telecopy) by such time
as determined by such Lender in accordance with such Lender's customary
practices (in any event not to be later than 10:30 A.M. (Charlotte, North
Carolina time)) on the date of the requested Competitive Loan.
Competitive Bids so made shall be irrevocable. Each Competitive Bid
shall specify (i) the date of the proposed Competitive Loan, (ii) the
maximum and minimum principal amounts of the Competitive Loan for which
such offer is being made (which may be for all or a part of (but not more
than) the amount requested by the Borrower), (iii) the applicable
Competitive Bid Rate, and (iv) the applicable Interest Period.
(d) Acceptance of Competitive Bids. The Borrower may, before such
time as determined by the applicable Lender in accordance with such
Lender's customary practices (in any event until 1:00 P.M. (Charlotte,
North Carolina time)) on the date of the requested Competitive Loan,
accept any Competitive Bid by giving the applicable Lender and the Agent
telephone notice (immediately confirmed in writing) of (i) the Lender or
Lenders whose Competitive Bid(s) is/are accepted, (ii) the principal
amount of the Competitive Bid(s) so accepted and (iii) the Interest
Period of the Competitive Bid(s) so accepted. The Borrower may accept
any Competitive Bid in whole or in part; provided, however, that (a) the
principal amount of each Competitive Loan may not exceed the maximum
amount offered in the Competitive Bid and may not be less than the
minimum amount offered in the Competitive Bid, (b) the principal amount
of each Competitive Loan may not exceed the total amount requested
pursuant to subsection (a) above, (c) the Borrower shall not accept a
Competitive Bid made at a particular Competitive Bid Rate if it has
decided to reject a Competitive Bid made at a lower Competitive Bid Rate
and (d) if the Borrower shall accept a Competitive Bid or Bids made at a
particular Competitive Bid Rate but the amount of such Competitive Bid or
Bids shall cause the total amount of Competitive Bids to be accepted by
the Borrower to exceed the total amount requested pursuant to subsection
(a) above, then the Borrower shall accept a portion of such Competitive
Bid or Bids in an amount equal to the total amount requested pursuant to
subsection (a) above less the amount of other Competitive Bids accepted
with respect to such request, which acceptance, in the case of multiple
Competitive Bids at the same Competitive Bid Rate, shall be made pro rata
in accordance with each such Competitive Bid at such Competitive Bid
Rate. Competitive Bids so accepted by the Borrower shall be irrevocable.
(e) Funding of Competitive Loans. Upon acceptance by the Borrower
pursuant to subsection (d) above of all or a portion of any Lender's
Competitive Bid, such Lender shall, before such time as determined by
such Lender in accordance with such Lender's customary practices, on the
date of the requested Competitive Loan, make such Competitive Loan
available by crediting the Master Account with the amount of such
Competitive Loan.
(f) Competitive Notes. The Competitive Loans of each Lender shall
be evidenced by a single Competitive Note duly executed on behalf of the
Borrower, dated the date hereof, in substantially the form of Schedule
2.2(f), payable to the order of such Lender.
(g) Repayment of Competitive Loans. The Borrower shall repay to
each Lender which has made a Competitive Loan on the last day of the
Interest Period for such Competitive Loan the then unpaid principal
amount of such Competitive Loan. Unless the Borrower shall give to
notice to the Agent otherwise, the Borrower shall be deemed to have
requested a Revolving Loan advance comprised of Base Rate Loans in the
amount of the maturing Competitive Loan, the proceeds of which will be
used to repay such Competitive Loan.
(h) Interest on Competitive Loans. The Borrower shall pay interest
to each Lender on the unpaid principal amount of each Competitive Loan
from and including the date of such Competitive Loan to but
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19
excluding the stated maturity date thereof, at the applicable Competitive
Bid Rate for such Competitive Loan (computed on the basis of the actual
number of days elapsed over a year of 360 days). Interest on Competitive
Loans shall be payable in arrears on each applicable Interest Payment Date
(or at such other times as may be specified herein).
(i) Limitation on Number of Competitive Loans. The Borrower shall
not request a Competitive Loan if, assuming the maximum amount of
Competitive Loans so requested is borrowed as of the date of such
request, the sum of the aggregate principal amount of outstanding
Revolving Loans plus the aggregate principal amount of outstanding
Competitive Loans plus the aggregate principal amount of outstanding
Swingline Loans would exceed the aggregate Revolving Committed Amount.
(j) Change in Procedures for Requesting Competitive Loans. The
Borrower and the Lenders hereby agree that, notwithstanding any other
provision to the contrary contained in this Credit Agreement, upon mutual
agreement of the Agent and the Borrower and written notice by the Agent
to the Lenders, all further requests by the Borrower for Competitive
Loans shall be made by the Borrower to the Lenders through the Agent in
accordance with such procedures as shall be prescribed by the Agent and
acceptable to the Borrower and each Lender.
2.3 SWINGLINE LOAN SUBFACILITY.
(a) Swingline Commitment. Subject to the terms and conditions
hereof and in reliance upon the representations and warranties herein set
forth, the Swingline Lender, in its individual capacity, agrees to make
certain revolving credit loans requested by the Borrower in Dollars to
the Borrower (each a "Swingline Loan" and, collectively, the "Swingline
Loans") from time to time from the Closing Date until the Termination
Date for the purposes hereinafter set forth; provided, however, (i) the
aggregate principal amount of Swingline Loans outstanding at any time
shall not exceed TWENTY-FIVE MILLION DOLLARS ($25,000,000.00) (the
"Swingline Committed Amount"), and (ii) the aggregate principal amount of
outstanding Revolving Loans plus the aggregate principal amount of
outstanding Competitive Loans plus the aggregate principal amount of
outstanding Swingline Loans shall not exceed the Revolving Committed
Amount. Swingline Loans hereunder shall be made as Base Rate Loans or
Quoted Rate Swingline Loans as the Borrower may request in accordance
with the provisions of this Section 2.3, and may be repaid and reborrowed
in accordance with the provisions hereof.
(b) Swingline Loan Advances.
(i) Notices; Disbursement. Whenever the Borrower desires a
Swingline Loan advance hereunder it shall give written notice (or
telephone notice promptly confirmed in writing) to the Swingline
Lender not later than 2:00 P.M. (Charlotte, North Carolina time) on
the Business Day of the requested Swingline Loan advance. Each
such notice shall be irrevocable and shall specify (A) that a
Swingline Loan advance is requested, (B) the date of the requested
Swingline Loan advance (which shall be a Business Day) and (C) the
principal amount of the Swingline Loan advance requested. Each
Swingline Loan shall be made as a Base Rate Loan or a Quoted Rate
Swingline Loan and shall have such maturity date as the Swingline
Lender and the Borrower shall agree upon receipt by the Swingline
Lender of any such notice from the Borrower. The Swingline Lender
shall initiate the transfer of funds representing the Swingline
Loan advance to the Master
Account by 3:30 P.M. (Charlotte, North Carolina time) on the
Business Day of the requested borrowing.
(ii) Minimum Amounts. Each Swingline Loan advance shall be in
a minimum principal amount of $250,000 and in integral multiples of
$100,000 in excess thereof (or the remaining amount of the
Swingline Committed Amount, if less).
(iii) Repayment of Swingline Loans. The principal amount of
all Swingline Loans shall be due and payable on the earlier of (A)
the maturity date agreed to by the Swingline Lender and the
Borrower with respect to such Loan (which maturity date shall not
be a date more than seven (7)
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Business Days from the date of advance thereof) or (B) the
Termination Date. The Swingline Lender may, at any time, in its sole
discretion, by written notice to the Borrower and the Lenders,
demand repayment of its Swingline Loans by way of a Revolving Loan
advance, in which case the Borrower shall be deemed to have
requested a Revolving Loan advance comprised solely of Base Rate
Loans in the amount of such Swingline Loans; provided, however, that
any such demand shall be deemed to have been given one Business Day
prior to the Termination Date and on the date of the occurrence of
any Event of Default described in Section 8.1 and upon acceleration
of the indebtedness hereunder and the exercise of remedies in
accordance with the provisions of Section 8.2. Each Lender hereby
irrevocably agrees to make its pro rata share of each such Revolving
Loan in the amount, in the manner and on the date specified in the
preceding sentence notwithstanding (I) the amount of such borrowing
may not comply with the minimum amount for advances of Revolving
Loans otherwise required hereunder, (II) whether any conditions
specified in Section 4.2 are then satisfied, (III) whether a Default
or an Event of Default then exists, (IV) failure of any such request
or deemed request for Revolving Loan to be made by the time
otherwise required hereunder, (V) whether the date of such borrowing
is a date on which Revolving Loans are otherwise permitted to be
made hereunder or (VI) any termination of the Commitments relating
thereto immediately prior to or contemporaneously with such
borrowing. In the event that any Revolving Loan cannot for any
reason be made on the date otherwise required above (including,
without limitation, as a result of the commencement of a proceeding
under the Bankruptcy Code with respect to the Borrower), then each
Lender hereby agrees that it shall forthwith purchase (as of the
date such borrowing would otherwise have occurred, but adjusted for
any payments received from the Borrower on or after such date and
prior to such purchase) from the Swingline Lender such
participations in the outstanding Swingline Loans as shall be
necessary to cause each such Lender to share in such Swingline Loans
ratably based upon its Commitment Percentage (determined before
giving effect to any termination of the Commitments pursuant to
Section 3.4), provided that (A) all interest payable on the
Swingline Loans shall be for the account of the Swingline Lender
until the date as of which the respective participation is purchased
and (B) at the time any purchase of participations pursuant to this
sentence is actually made, the purchasing Lender shall be required
to pay to the Swingline Lender, to the extent not paid to the
Swingline Lender by the Borrower in accordance with the terms of
subsection (c)(ii) hereof, interest on the principal amount of
participation purchased for each day from and including the day upon
which such borrowing would otherwise have occurred to but excluding
the date of payment for such participation, at the rate equal to the
Federal Funds Rate.
(c) Interest on Swingline Loans.
(i) Subject to the provisions of Section 3.1, each Swingline
Loan shall bear interest as follows:
(A) Base Rate Loans. If such Swingline Loan is a Base
Rate Loan, at a per annum rate (computed on the basis of the
actual number of days elapsed over a year of 365 days) equal
to the Base Rate plus the Applicable Percentage.
(B) Quoted Rate Swingline Loans. If such Swingline Loan
is a Quoted Rate Swingline Loan, at a per annum rate
(computed on the basis of the actual number of days elapsed
over a year of 360 days) equal to the Quoted Rate applicable
thereto.
Notwithstanding any other provision to the contrary set forth in
this Credit Agreement, in the event that the principal amount of
any Quoted Rate Swingline Loan is not repaid on the last day of the
Interest Period for such Loan, then such Loan shall be
automatically converted into a Base Rate Loan at the end of such
Interest Period.
(ii) Payment of Interest. Interest on Swingline Loans shall
be payable in arrears on each applicable Interest Payment Date (or
at such other times as may be specified herein).
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(d) Swingline Note. The Swingline Loans shall be evidenced by a
duly executed promissory note of the Borrower to the Swingline Lender in
an original principal amount equal to the Swingline Committed Amount
substantially in the form of Schedule 2.3(d).
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1 DEFAULT RATE.
Upon the occurrence, and during the continuance, o f an Event of Default,
the principal of and, to the extent permitted by law, interest on the Loans and
any other amounts owing hereunder or under the other Credit Documents shall bear
interest, payable on demand, at a per annum rate 2% greater than the rate which
would otherwise be applicable (or if no rate is applicable, whether in respect
of interest, fees or other amounts, then 2% greater than the Base Rate).
3.2 EXTENSION AND CONVERSION.
Subject to the terms of Section 4.2, the Borrower shall have the option,
on any Business Day, to extend existing Loans into a subsequent permissible
Interest Period or to convert Loans into Loans of another interest rate type;
provided, however, that (a) except as provided in Section 3.8, Eurodollar Loans
may be converted into Base Rate Loans only on the last day of the Interest
Period applicable thereto, (b) Eurodollar Loans may be extended, and Base Rate
Loans may be converted into Eurodollar Loans, only if no Default or Event of
Default is in existence on the date of extension or conversion, (c) Loans
extended as, or converted into, Eurodollar Loans shall be subject to the terms
of the definition of "Interest Period" set forth in Section 1.1 and shall be in
such minimum amounts as provided in Section 2.1(b)(ii), (d) no more than 25
Eurodollar Loans shall be outstanding hereunder at any time (it being understood
that, for purposes hereof, Eurodollar Loans with different Interest Periods
shall be considered as separate Eurodollar Loans, even if they begin on the same
date, although borrowings, extensions and conversions may, in accordance with
the provisions hereof, be combined at the end of existing Interest Periods to
constitute a new Eurodollar Loan with a single Interest Period), (e) any request
for extension or conversion of a Eurodollar Loan which shall fail to specify an
Interest Period shall be deemed to be a request for an Interest Period of one
month and (f) Competitive Loans and Swingline Loans may not be extended or
converted pursuant to this Section 3.2. Each such extension or conversion shall
be effected by a Financial Officer of the Borrower giving a Notice of
Extension/Conversion (or telephone notice promptly confirmed in writing) to the
Agent prior to 11:30 A.M. (Charlotte, North Carolina time) on the Business Day
of, in the and prior to 2:00 P.M. (Charlotte, North Carolina time) on the third
Business Day prior to, in the case of the extension of a Eurodollar Loan as, or
conversion of a Base Rate Loan into, a Eurodollar Loan, the date of the proposed
extension or conversion, specifying the date of the proposed extension or
conversion, the Loans to be so extended or converted, the types of Loans into
which such Loans are to be converted and, if appropriate, the applicable
Interest Periods with respect thereto. Each request for extension or conversion
shall be irrevocable and shall constitute a representation and warranty by the
Borrower of the matters specified in subsections (b), (c), (d) and (e) of
Section 4.2. In the event the Borrower fails to request extension or conversion
of any Eurodollar Loan in accordance with this Section, or any such conversion
or extension is not permitted or required by this Section, then such Eurodollar
Loan shall be automatically converted into a Base Rate Loan at the end of the
Interest Period applicable thereto. The Agent shall give each Lender notice as
promptly as practicable of any such proposed extension or conversion affecting
any Loan.
3.3 PREPAYMENTS.
(a) Voluntary Prepayments. The Borrower shall have the right to
prepay Loans in whole or in part from time to time, subject to Section
3.11, but otherwise without premium or penalty; provided, however, that
(i) Eurodollar Loans and Competitive Loans may only be prepaid on three
Business Days' prior written notice to the Agent and specifying the
applicable Loans to be prepaid; (ii) any prepayment of Eurodollar Loans,
Competitive Loans or Quoted Rate Swingline Loans will be subject to
Section 3.11; and (iii) each such partial prepayment of Loans shall be
(A) in the case of Revolving Loans and Competitive Loans, in a minimum
principal amount of $5,000,000 and multiples of $1,000,000 in excess
thereof (or, if less, the full remaining
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amount of the Revolving Loan or Competitive Loan being prepaid) and (B) in
the case of Swingline Loans, in a minimum principal amount of $250,000 and
multiples of $100,000 in excess thereof (or, if less, the full remaining
amount of the then outstanding Swingline Loans). Subject to the foregoing
terms, amounts prepaid under this Section 3.3(a) shall be applied as the
Borrower may elect.
(b) Mandatory Prepayments. If at any time, the sum of the aggregate
principal amount of outstanding Revolving Loans plus the aggregate
principal amount of outstanding Competitive Loans plus the aggregate
principal amount of outstanding Swingline Loans shall exceed the
Revolving Committed Amount, the Borrower promises to prepay immediately
the outstanding principal balance on the Revolving Loans and/or
Competitive Loans in an amount sufficient to eliminate such excess.
(c) General. All prepayments made pursuant to this Section 3.3
shall (i) be subject to Section 3.11 and (ii) unless the Borrower shall
specify otherwise, be applied first to Base Rate Loans, if any, and then
to Eurodollar Loans in direct order of Interest Period maturities.
Amount prepaid on the Revolving Loans may be reborrowed in accordance
with the provisions hereof.
3.4 TERMINATION, REDUCTION AND INCREASE OF REVOLVING COMMITTED AMOUNT.
(a) Voluntary Reductions. The Borrower may from time to time
permanently reduce or terminate the Revolving Committed Amount in whole
or in part (in minimum aggregate amounts of $5,000,000 or in integral
multiples of $1,000,000 in excess thereof (or, if less, the full
remaining amount of the then applicable Revolving Committed Amount)) upon
five Business Days' prior written notice to the Agent; provided, however,
no such termination or reduction shall be made which would cause the
aggregate principal amount of outstanding Revolving Loans plus the
aggregate principal amount of outstanding Competitive Loans plus the
aggregate principal amount of outstanding Swingline Loans to exceed the
Revolving Committed Amount unless, concurrently with such termination or
reduction, the Revolving Loans and/or Competitive Loans are repaid to the
extent necessary to eliminate such excess. The Commitments of the
Lenders shall automatically terminate on the Termination Date. The Agent
shall promptly notify each affected Lender of receipt by the Agent of any
notice from the Borrower pursuant to this Section 3.4(a).
(b) Additional Commitments. The Borrower and the Agent shall have
the right to make a one-time increase in the Revolving Committed Amount
up to an aggregate amount of $350,000,000 without the consent of the
Lenders, subject however to the satisfaction of each of the following
terms and conditions:
(i) to the knowledge of the Agent, no Default or Event of
Default shall exist and be continuing at the time of such increase;
(ii) such increase shall occur only once;
(iii) such increase shall be allocated in the following order:
(A) first, to the existing Lenders consenting to an
increase in the amount of their Revolving Commitments;
provided that (1) on or before the tenth Business Day
following notification of a requested increase in the
Revolving Committed Amount, each Lender shall notify the
Borrower of the desired increase, if any, in its Revolving
Commitment and (2) if the aggregate increases in the
Revolving Commitments requested by the existing Lenders shall
exceed the requested increase in the Revolving Committed
Amount, the Revolving Commitments of such Lenders shall be
increased on a pro rata basis according to the existing
Commitment Percentage of such Lenders; and
(B) second, to any other commercial bank, financial
institution or "accredited investor" (as defined in
Regulation D of the Securities and Exchange Commission)
reasonably acceptable to the Agent and the Borrower;
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(iv) each Person providing a new Commitment shall execute a
New Commitment Agreement substantially in the form of Schedule
3.4(b) hereto and, upon such execution and the satisfaction of the
other terms and conditions of this Section 3.4(b), such Person
shall thereupon become a party hereto and have the rights and
obligations of a Lender under this Credit Agreement as more
specifically provided in the New Commitment Agreement; and
(v) the Agent shall promptly notify each Lender of (A) the
Revolving Committed Amount and (B) each Lender's Commitment
Percentage, in each case after giving effect to the one-time
increase in Revolving Commitment referred to in this Section
3.4(b).
On the date (which date shall be a Business Day) on which the increase in
the Revolving Committed Amount occurs the Agent and the Lenders shall
make adjustments among the Lenders with respect to the Revolving Loans
outstanding hereunder and amounts of principal, interest, fees and other
amounts paid or payable with respect thereto as shall be necessary in
order to reallocate among the Lenders such outstanding amounts based on
the new Commitment Percentages and to otherwise carry out fully the terms
of this Section 3.4(b). The Borrower agrees that, in connection with any
such increase in the Revolving Committed Amount, it will promptly (i)
provide to each Lender providing a new or increased Revolving Commitment
(upon surrender of the existing Revolving Note of such Lender in the case
of an existing Lender) a Revolving Note in the amount of its new or
increased (as applicable) Revolving Commitment substantially in the form
of the Revolving Note attached hereto as Schedule 2.1(e) (but, in the
case of a new Revolving Note given to an existing Lender that increases
its Revolving Commitment, with notation thereon that it is given in
substitution for and replacement of the original Revolving Note or any
replacement notes thereof) and (ii) provide to each Lender (upon
surrender of the existing Competitive Note of such Lender in the case of
an existing Lender) a Competitive Note in the amount of the new Revolving
Committed Amount substantially in the form of the Competitive Note
attached hereto as Schedule 2.2(f) (but, in the case of a new Competitive
Note given to an existing Lender, with notation thereon that it is given
in substitution for and replacement of the original Competitive Note or
any replacement notes thereof). Each of the parties hereto acknowledges
and agrees that no Lender shall be obligated to increase its Revolving
Commitment pursuant to the terms of this Section 3.4(b).
(c) Termination Date. The Revolving Commitments of the Lenders and
the Swingline Commitment of the Swingline Lender shall automatically
terminate on the Termination Date.
(d) General. The Borrower shall pay to the Agent for the account of
the Lenders in accordance with the terms of Section 3.5(a), on the date
of each termination or reduction of the Revolving Committed Amount, the
Facility Fee accrued through the date of such termination or reduction on
the amount of the Revolving Committed Amount so terminated or reduced.
3.5 FEES.
(a) Facility Fee. In consideration of the Revolving Commitments of
the Lenders hereunder, the Borrower agrees to pay to the Agent for the
account of each Lender a fee (the "Facility Fee") on the Revolving
Committed Amount computed at a per annum rate for each day during the
applicable Facility Fee Calculation Period (hereinafter defined) at a rate
equal to the Applicable Percentage in effect from time to time. The
Facility Fee shall commence to accrue on the Closing Date and shall be due
and payable in arrears on the last business day of each March, June,
September and December (and any date that the Revolving Committed Amount
is reduced or increased as provided in Section 3.4 and the Termination
Date) for the immediately preceding quarter (or portion thereof) (each
such quarter or portion thereof for which the Facility Fee is payable
hereunder being herein referred to as a "Facility Fee Calculation
Period"), beginning with the first of such dates to occur after the
Closing Date.
(b) Administrative Fees. The Borrower agrees to pay to the Agent,
for its own account, the fees referred to in the Agent's Fee Letter
(collectively, the "Agent's Fees").
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3.6 CAPITAL ADEQUACY.
If any Lender determines the amount of capital required or expected to be
maintained by such Lender, any Lending Installation of such Lender or any
corporation controlling such Lender is increased as a result of a Change, then,
within 15 days of demand by such Lender, the Borrower shall pay such Lender the
amount necessary to compensate for any shortfall in the rate of return on the
portion of such increased capital which such Lender determines is attributable
to this Credit Agreement, its Loans or its obligation to make Loans hereunder
(after taking into account such Lender's policies as to capital adequacy).
"Change" means (i) any change after the Closing Date in the Risk-Based Capital
Guidelines or (ii) any adoption of or change in any other law, governmental or
quasi-governmental rule, regulation, policy, guideline, interpretation, or
directive (whether or not having the force of law) after the Closing Date which
affects the amount of capital required or expected to be maintained by any
Lender or any Lending Installation or any corporation controlling any Lender.
"Risk-Based Capital Guidelines" means (i) the risk-based capital guidelines in
effect in the United States on the Closing Date, including transition rules,
and (ii) the corresponding capital regulations promulgated by regulatory
authorities outside the United States implementing the July 1988 report of the
Basle Committee on Banking Regulation and Supervisory Practices Entitled
"International Convergence of Capital Measurements and Capital Standards,"
including transition rules, and any amendments to such regulations adopted
prior to the Closing Date.
3.7 INABILITY TO DETERMINE INTEREST RATE.
If prior to the first day of any Interest Period, the Agent shall have
reasonably determined that, by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate for such Interest Period, the Agent shall give telecopy or
telephonic notice thereof to the Borrower and the Lenders as soon as
practicable thereafter. If such notice is given (a) any Eurodollar Loans
requested to be made on the first day of such Interest Period shall be made as
Base Rate Loans and (b) any Loans that were to have been converted on the first
day of such Interest Period to or continued as Eurodollar Loans shall be
converted to or continued as Base Rate Loans. Until such notice has been
withdrawn by the Agent, no further Eurodollar Loans shall be made or continued
as such, nor shall the Borrower have the right to convert Base Rate Loans to
Eurodollar Loans.
3.8 ILLEGALITY.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurodollar Loans as contemplated by this Credit Agreement, (a) such
Lender shall promptly give written notice of such circumstances to the Borrower
and the Agent (which notice shall be withdrawn whenever such circumstances no
longer exist), (b) the commitment of such Lender hereunder to make Eurodollar
Loans, continue Eurodollar Loans as such and convert a Base Rate Loan to
Eurodollar Loans shall forthwith be canceled and, until such time as it shall no
longer be unlawful for such Lender to make or maintain Eurodollar Loans, such
Lender shall then have a commitment only to make a Base Rate Loan when a
Eurodollar Loan is requested and (c) such Lender's Loans then outstanding as
Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans on
the respective last days of the then current Interest Periods with respect to
such Loans or within such earlier period as required by law. If any such
conversion of a Eurodollar Loan occurs on a day which is not the last day of the
then current Interest Period with respect thereto, the Borrower shall pay to
such Lender such amounts, if any, as may be required pursuant to Section 3.11.
3.9 YIELD PROTECTION.
If any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law) , or
any interpretation thereof, or the compliance of any Lender therewith,
(a) subjects any Lender or any applicable Lending Installation to
any tax, duty, charge or withholding on or from payments due from the
Borrower (excluding federal taxation of the overall net income of any
Lender or applicable Lending Installation), or changes the basis of
taxation of payments to any Lender in respect of its Loans or other
amounts due it hereunder;
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(b) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar requirements
against assets of, deposits with or for the account of, or credit
extended by, any Lender or any applicable Lending Installation (other
than reserves and assessments taken into account in determining the Base
Rate);
and the result of which is to increase the cost to any Lender of making,
funding or maintaining loans or reduces any amount receivable by any Lender or
any applicable Lending Installation in connection with loans, or requires any
Lender or any applicable Lending Installation to make any payment calculated by
reference to the amount of loans held or interest received by it, by an amount
deemed material by such Lender;
then, within 15 days of demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an
amount received which such Lender determines is attributable to making, funding
and maintaining its Loans and its Commitments. This covenant shall survive the
termination of this Credit Agreement and the payment of the Loans and all other
amounts payable hereunder.
3.10 WITHHOLDING TAX EXEMPTION.
Each Lender that is not incorporated under the laws of the United States
of America or a state thereof shall:
(a) (i) on or before the date of any payment by the Borrower under
this Credit Agreement or Notes to such Lender, deliver to the
Borrower and the Agent (A) two (2) duly completed copies of United
States Internal Revenue Service Form 1001 or 4224, or successor
applicable form, as the case may be, certifying that it is entitled
to receive payments under this Credit Agreement and any Notes
without deduction or withholding of any United States federal
income taxes and (B) an Internal Revenue Service Form W-8 or W-9,
or successor applicable form, as the case may be, certifying that
it is entitled to an exemption from United States backup
withholding tax;
(ii) deliver to the Borrower and the Agent two (2) further
copies of any such form or certification on or before the date that
any such form or certification expires or becomes obsolete and
after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and complete
such forms or certifications as may reasonably be requested by the
Borrower or the Agent; or
(b) in the case of any such Lender that is not a "bank" within the
meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (i)
represent to the Borrower (for the benefit of the Borrower and the Agent)
that it is not a bank within the meaning of Section 881(c)(3)(A) of the
Internal Revenue Code, (ii) agree to furnish to the Borrower on or before
the date of any payment by the Borrower, with a copy to the Agent two (2)
accurate and complete original signed copies of Internal Revenue Service
Form W-8, or successor applicable form certifying to such Lender's legal
entitlement at the date of such certificate to an
exemption from U.S. withholding tax under the provisions of Section
881(c) of the Internal Revenue Code with respect to payments to be made
under this Credit Agreement and any Notes (and to deliver to the Borrower
and the Agent two (2) further copies of such form on or before the date
it expires or becomes obsolete and after the occurrence of any event
requiring a change in the most recently provided form and, if necessary,
obtain any extensions of time reasonably requested by the Borrower or the
Agent for filing and completing such forms), and (iii) agree, to the
extent legally entitled to do so, upon reasonable request by the
Borrower, to provide to the Borrower (for the benefit of the Borrower and
the Agent) such other forms as may be reasonably required in order to
establish the legal entitlement of such Lender to an exemption from
withholding with respect to payments under this Credit Agreement and any
Notes;
unless in any such case any change in treaty, law or regulation has occurred
after the date such Person becomes a Lender hereunder which renders all such
forms inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender so advises the
Borrower and the Agent in either case. Each
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Person that shall become a Lender or a participant of a Lender pursuant to
subsection 10.3 shall, upon the effectiveness of the related transfer, be
required to provide all of the forms, certifications and statements required
pursuant to this subsection, provided that in the case of a participant of a
Lender the obligations of such participant of a Lender pursuant to this Section
3.10 shall be determined as if the participant of a Lender were a Lender except
that such participant of a Lender shall furnish all such required forms,
certifications and statements to the Lender from which the related participation
shall have been purchased.
3.11 INDEMNITY.
The Borrower promises to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur (other
than through such Lender's gross negligence or willful misconduct) as a
consequence of (a) default by the Borrower in making a borrowing of, conversion
into or continuation of Eurodollar Loans or Quoted Rate Swingline Loans after
the Borrower has given a notice requesting the same in accordance with the
provisions of this Credit Agreement, (b) default by the Borrower in making any
prepayment of a Eurodollar Loan or a Quoted Rate Swingline Loan after the
Borrower has given a notice thereof in accordance with the provisions of this
Credit Agreement or (c) the making of a prepayment of Eurodollar Loans or
Quoted Rate Swingline Loans on a day which is not the last day of an Interest
Period with respect thereto. With respect to Eurodollar Loans, such
indemnification may include an amount equal to the excess, if any, of (i) the
amount of interest which would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
the applicable Interest Period (or, in the case of a failure to borrow, convert
or continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Eurodollar
Loans provided for herein (excluding, however, the Applicable Percentage
included therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) which would have accrued to such Lender on such
amount by placing such amount on deposit for a comparable period with leading
banks in the interbank Eurodollar market. The covenants of the Borrower set
forth in this Section 3.11 shall survive the termination of this Credit
Agreement and the payment of the Loans and all other amounts payable hereunder.
3.12 PRO RATA TREATMENT.
Except to the extent otherwise provided herein:
(a) Loans. Each Loan, each payment or prepayment of principal of any
Loan, each payment of interest on the Loans, each payment of Facility
Fees, each reduction of the Revolving Committed Amount and each conversion
or extension of any Loan, shall be allocated pro rata among the Lenders in
accordance with the respective principal amounts of their outstanding
Loans and Participation Interests. With respect to Competitive Loans, if
the Borrower fails to specify the particular Competitive Loan or Loans as
to which any payment or other amount should be applied and it is not
otherwise clear as to the particular Competitive Loan or Loans to which
such payment or other amounts relate, or any such payment or other amount
is to be applied to Competitive Loans without regard to any such direction
by the Borrower, then each payment or prepayment of principal on
Competitive Loans and each payment of interest or other amount on or in
respect of Competitive Loans, shall be allocated pro rata among the
relevant Lenders of Competitive Loans in accordance with the then
outstanding amounts of their respective Competitive Loans.
(b) Advances. Unless the Agent shall have been notified in writing
by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its ratable share of such borrowing
available to the Agent, the Agent may assume that such Lender is making
such amount available to the Agent, and the Agent may, in reliance upon
such assumption, make available to the Borrower a corresponding amount.
If such amount is not made available to the Agent by such Lender within
the time period specified therefor hereunder, such Lender shall pay to
the Agent, on demand, such amount with interest thereon at a rate equal
to the Federal Funds Rate for the period until such Lender makes such
amount immediately available to the Agent. A certificate of the Agent
submitted to any Lender with respect to any amounts owing under this
subsection shall be conclusive in the absence of manifest error.
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3.13 SHARING OF PAYMENTS.
The Lenders agree among themselves that, in the event that any Lender
shall obtain payment in respect of any Loan or any other obligation owing to
such Lender under this Credit Agreement through the exercise of a right of
setoff, banker's lien or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Code or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable bankruptcy, insolvency or other similar law or otherwise, or by
any other means, in excess of its pro rata share of such payment as provided
for in this Credit Agreement, such Lender shall promptly purchase from the
other Lenders a participation in such Loans and other obligations in such
amounts, and make such other adjustments from time to time, as shall be
equitable to the end that all Lenders share such payment in accordance with
their respective ratable shares as provided for in this Credit Agreement. The
Lenders further agree among themselves that if payment to a Lender obtained by
such Lender through the exercise of a right of setoff, banker's lien,
counterclaim or other event as aforesaid shall be rescinded or must otherwise
be restored, each Lender which shall have shared the benefit of such payment
shall, by repurchase of a participation theretofore sold, return its share of
that benefit (together with its share of any accrued interest payable with
respect thereto) to each Lender whose payment shall have been rescinded or
otherwise restored. The Borrower agrees that any Lender so purchasing such a
participation may, to the fullest extent permitted by law, exercise all rights
of payment, including setoff, banker's lien or counterclaim, with respect to
such participation as fully as if such Lender were a holder of such Loan or
other obligation in the amount of such participation. Except as otherwise
expressly provided in this Credit Agreement, if any Lender or the Agent shall
fail to remit to the Agent or any other Lender an amount payable by such Lender
or the Agent to the Agent or such other Lender pursuant to this Credit
Agreement on the date when such amount is due, such payments shall be made
together with interest thereon for each date from the date such amount is due
until the date such amount is paid to the Agent or such other Lender at a rate
per annum equal to the Federal Funds Rate. If under any applicable bankruptcy,
insolvency or other similar law, any Lender receives a secured claim in lieu of
a setoff to which this Section 3.13 applies, such Lender shall, to the extent
practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders under this Section 3.13 to share in
the benefits of any recovery on such secured claim.
3.14 PAYMENTS, COMPUTATIONS, ETC.
(a) Except as otherwise specifically provided herein, all payments
hereunder (other than payments in respect of Competitive Loans) shall be
made to the Agent in dollars in immediately available funds, without
offset, deduction, counterclaim or withholding of any kind, at the
Agent's office specified in Schedule 2.1(a) not later than 4:00 P.M.
(Charlotte, North Carolina time) on the date when due. Payments received
after such time shall be deemed to have been received on the next
succeeding Business Day. The Agent may (but shall not be obligated to)
debit the amount of any such payment which is not made by such time to
any ordinary deposit account of the Borrower maintained with the Agent
(with notice to the Borrower). The Borrower shall, at the time it makes
any payment under this Credit Agreement (other than payments in respect
of Competitive Loans), specify to the Agent the Loans, Fees, interest or
other amounts payable by the Borrower hereunder to which such payment is
to be applied (and in the event that it fails so to specify, or if such
application would be inconsistent with the terms hereof, the Agent shall
distribute such payment to the Lenders in such manner as the Agent may
determine to be appropriate in respect of obligations owing by the
Borrower hereunder, subject to the terms of Section 3.12(a)). The Agent
will distribute such payments to such Lenders, if any such payment is
received prior to 12:00 Noon (Charlotte, North Carolina time) on a
Business Day in like funds as received prior to the end of such Business
Day and otherwise the Agent will distribute such payment to such Lenders
on the next succeeding Business Day. All payments of principal and
interest in respect of Competitive Loans shall be in accordance with the
terms of Section 2.2. Whenever any payment hereunder shall be stated to
be due on a day which is not a Business Day, the due date thereof shall
be extended to the next succeeding Business Day (subject to accrual of
interest and Fees for the period of such extension), except that in the
case of Eurodollar Loans, if the extension would cause the payment to be
made in the next following calendar month, then such payment shall
instead be made on the next preceding Business Day. Except as expressly
provided otherwise herein, all computations of interest and fees shall be
made on the basis of actual number of days elapsed over a year of 360
days, except with respect to computation of interest on Base Rate Loans
which (unless the Base Rate is determined by reference to the Federal
Funds Rate) shall be calculated
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based on a year of 365 or 366 days, as appropriate. Interest shall accrue
from and include the date of borrowing, but exclude the date of payment.
(b) Allocation of Payments After Event of Default. Notwithstanding
any other provisions of this Credit Agreement to the contrary, after the
occurrence and during the continuance of an Event of Default, all amounts
collected or received by the Agent or any Lender on account of the Loans,
Fees or any other amounts outstanding under any of the Credit Documents
shall be paid over or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys'
fees) of the Agent in connection with enforcing the rights of the
Lenders under the Credit Documents;
SECOND, to payment of any fees owed to the Agent;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its
rights under the Credit Documents or otherwise with respect to
amounts owing to such Lender;
FOURTH, to the payment of accrued fees and interest;
FIFTH, to the payment of the outstanding principal amount of
the Loans;
SIXTH, to all other amounts and other obligations which shall
have become due and payable under the Credit Documents or otherwise
and not repaid pursuant to clauses "FIRST" through "FIFTH" above;
and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in
the numerical order provided until exhausted prior to application to the
next succeeding category; and (ii) each of the Lenders shall receive an
amount equal to its pro rata share (based on the proportion that the then
outstanding Loans held by such Lender bears to the aggregate then
outstanding Loans) of amounts available to be applied pursuant to clauses
"THIRD", "FOURTH", "FIFTH" and "SIXTH" above.
3.15 EVIDENCE OF DEBT.
(a) Each Lender shall maintain an account or accounts evidencing
each Loan made by such Lender to the Borrower from time to time,
including the amounts of principal and interest payable and paid to such
Lender from time to time under this Credit Agreement. Each Lender will
make reasonable efforts to maintain the accuracy of its account or
accounts and to promptly update its account or accounts from time to
time, as necessary.
(b) The Agent shall maintain the Register pursuant to Section
10.3(c) hereof, and a subaccount for each Lender, in which Register and
subaccounts (taken together) shall be recorded (i) the amount, type and
Interest Period of each such Loan hereunder, (ii) the amount of any
principal or interest due and payable or to become due and payable to
each Lender hereunder and (iii) the amount of any sum received by the
Agent hereunder from or for the account of the Borrower and each Lender's
share thereof. The Agent will make reasonable efforts to maintain the
accuracy of the subaccounts referred to in the preceding sentence and to
promptly update such subaccounts from time to time, as necessary.
(c) The entries made in the accounts, Register and subaccounts
maintained pursuant to subsection (b) of this Section 3.15 (and, if
consistent with the entries of the Agent, subsection (a)) shall be prima
facie, but not conclusive, evidence of the existence and amounts of the
obligations of the Borrower therein
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recorded; provided, however, that the failure of any Lender or the Agent
to maintain any such account, such Register or such subaccount, as
applicable, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay the Loans made by such Lender in
accordance with the terms hereof.
3.16 REPLACEMENT OF LENDERS.
In the event any Lender delivers to the Borrower any notice in accordance
with Sections 3.6, 3.8, 3.9 or 3.10, then the Borrower shall have the right, if
no Default or Event of Default then exists, to replace such Lender (the
"Replaced Lender") with one or more additional banks or financial institutions
(collectively, the "Replacement Lender"), provided that (A) at the time of any
replacement pursuant to this Section 3.16, the Replacement Lender shall enter
into one or more assignment agreements substantially in the form of Schedule
10.3(b) pursuant to, and in accordance with the terms of, Section 10.3(b) (and
with all fees payable pursuant to said Section 10.3(b) to be paid by the
Replacement Lender) pursuant to which the Replacement Lender shall acquire all
of the rights and obligations of the Replaced Lender hereunder and, in
connection therewith, shall pay to the Replaced Lender in respect thereof an
amount equal to the sum of (a) the principal of, and all accrued interest on,
all outstanding Loans of the Replaced Lender, and (b) all accrued, but
theretofore unpaid, fees owing to the Replaced Lender pursuant to Section
3.5(a), and (B) all obligations of the Borrower owing to the Replaced Lender
(including all obligations, if any, owing pursuant to Section 3.6, 3.8 or 3.9,
but excluding those obligations specifically described in clause (A) above in
respect of which the assignment purchase price has been, or is concurrently
being paid) shall be paid in full to such Replaced Lender concurrently with
such replacement.
SECTION 4
CONDITIONS
4.1 CLOSING CONDITIONS.
The obligation of the Lenders to enter into this Credit Agreement and to
make the initial Loans shall be subject to satisfaction of the following
conditions (in form and substance acceptable to the Lenders):
(a) The Agent shall have received original counterparts of this
Credit Agreement executed by each of the parties hereto;
(b) The Agent shall have received an appropriate original Revolving
Note for each Lender, executed by the Borrower;
(c) The Agent shall have received an appropriate original
Competitive Note for each Lender, executed by the Borrower;
(d) The Agent shall have received an appropriate original Swingline
Note for the Swingline Lender, executed by the Borrower;
(e) The Agent shall have received all documents it may reasonably
request relating to the existence and good standing of the Borrower, the
corporate or other necessary authority for and the validity of the Credit
Documents, and any other matters relevant thereto, all in form and
substance reasonably satisfactory to the Agent;
(f) The Agent shall have received a legal opinion of Harry L.
Goldsmith, Esq., general counsel for the Borrower, dated as of the
Closing Date and substantially in the form of Schedule 4.1(f);
(g) The Agent shall have received a legal opinion of Moore & Van
Allen, PLLC, special counsel to the Agent, dated as of the Closing Date
and substantially in the form of Schedule 4.1(g);
(h) From August 31, 1996 until, and including, the Closing Date, no
material adverse change shall have occurred in the condition (financial
or otherwise), business or prospects of the Borrower and its Subsidiaries
taken as a whole;
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(i) The Agent shall have received, for its own account and for the
accounts of the Lenders, all fees and expenses required by this Credit
Agreement or any other Credit Document to be paid on or before the
Closing Date;
(j) Each of the Existing Credit Agreements shall have been
terminated; and
(k) The Agent shall have received such other documents, agreements
or information which may be reasonably requested by the Agent.
4.2 CONDITIONS TO ALL EXTENSIONS OF CREDIT.
The obligations of each Lender to make, convert or extend any Loan
(including the initial Loans) are subject to satisfaction of the following
conditions in addition to satisfaction on the Closing Date of the conditions
set forth in Section 4.1:
(a) The Borrower shall have delivered, in the case of any Revolving
Loan, an appropriate Notice of Borrowing or Notice of
Extension/Conversion;
(b) The representations and warranties set forth in Section 5 shall
be, subject to the limitations set forth therein, true and correct in all
material respects as of such date (except for those which expressly
relate to an earlier date);
(c) There shall not have been commenced against the Borrower an
involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or any case, proceeding or other
action for the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of the Borrower or
for any substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or other case,
proceeding or other action shall remain undismissed, undischarged or
unbonded;
(d) No Default or Event of Default shall exist and be continuing
either prior to or after giving effect thereto; and
(e) Immediately after giving effect to the making of such Loan (and
the application of the proceeds thereof), the sum of the aggregate
principal amount of outstanding Revolving Loans plus the aggregate
principal amount of outstanding Competitive Loans plus the aggregate
principal amount of outstanding Swingline Loans shall not exceed the
Revolving Committed Amount.
The delivery of each Notice of Borrowing and each Notice of
Extension/Conversion shall constitute a representation and warranty by the
Borrower of the correctness of the matters specified in subsections (b), (c),
(d) and (e) above.
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SECTION 5
REPRESENTATIONS AND WARRANTIES
The Borrower hereby represents to the Agent and each Lender that:
5.1 FINANCIAL CONDITION.
The audited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as of August 31, 1996 and the audited consolidated
statements of earnings and statements of cash flows for the year ended August
31, 1996 have heretofore been furnished to each Lender. Such financial
statements (including the notes thereto) (a) have been audited by Ernst &
Young, (b) have been prepared in accordance with GAAP consistently, applied
throughout the periods covered thereby and (c) present fairly (on the basis
disclosed in the footnotes to such financial statements) the consolidated
financial condition, results of operations and cash flows of the Borrower and
its consolidated Subsidiaries as of such date and for such periods. During the
period from August 31, 1996 to and including the Closing Date, there has been
no sale, transfer or other disposition by the Borrower or any of its
Subsidiaries of any material part of the business or property of the Borrower
and its consolidated Subsidiaries, taken as a whole, and no purchase or other
acquisition by any of them of any business or property (including any capital
stock of any other person) material in relation to the consolidated financial
condition of the Borrower and its consolidated Subsidiaries, taken as a whole,
in each case, which, is not reflected in the foregoing financial statements or
in the notes thereto and has not otherwise been disclosed in writing to the
Lenders on or prior to the Closing Date.
5.2 ORGANIZATION; EXISTENCE; COMPLIANCE WITH LAW.
Each of the Borrower and its Subsidiaries (a) is duly organized, validly
existing and is in good standing under the laws of the jurisdiction of its
incorporation or organization, (b) has the corporate or other necessary power
and authority, and the legal right, to own and operate its property, to lease
the property it operates as lessee and to conduct the business in which it is
currently engaged, except to the extent that the failure to have such legal
right would not be reasonably expected to have a Material Adverse Effect, (c)
is duly qualified as a foreign entity and in good standing under the laws of
each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, other than in such
jurisdictions where the failure to be so qualified and in good standing would
not be reasonably expected to have a Material Adverse Effect, and (d) is in
compliance with all material Requirements of Law, except to the extent that the
failure to comply therewith would not, in the aggregate, be reasonably expected
to have a Material Adverse Effect.
5.3 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
The Borrower has the corporate or other necessary power and authority, and
the legal right, to make, deliver and perform the Credit Documents to which it
is a party, and in the case of the Borrower, to borrow hereunder, and has taken
all necessary corporate action to authorize the borrowings on the terms and
conditions of this Credit Agreement and to authorize the execution, delivery and
performance of the Credit Documents to which it is a party. No consent or
authorization of, filing with, notice to or other similar act by or in respect
of, any Governmental Authority or any other Person is required to be obtained or
made by or on behalf of the Borrower in connection with the borrowings hereunder
or with the execution, delivery, performance, validity or enforceability of the
Credit Documents to which the Borrower is a party. This Credit Agreement has
been, and each other Credit Document to which the Borrower is a party will be,
duly executed and delivered on behalf of the Borrower. This Credit Agreement
constitutes, and each other Credit Document to which the Borrower is a party
when executed and delivered will constitute, a legal, valid and binding
obligation of the Borrower enforceable against such party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
5.4 NO LEGAL BAR.
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The execution, delivery and performance of the Credit Documents by the
Borrower, the borrowings hereunder and the use of the proceeds thereof (a) will
not violate any Requirement of Law or contractual obligation of the Borrower or
any of its Subsidiaries in any respect that would reasonably be expected to
have a Material Adverse Effect, (b) will not result in, or require, the
creation or imposition of any Lien on any of the properties or revenues of any
of the Borrower or any of its Subsidiaries pursuant to any such Requirement of
Law or contractual obligation, and (c) will not violate or conflict with any
provision of the Borrower's articles of incorporation or by-laws.
5.5 NO MATERIAL LITIGATION.
As of the Closing Date, no litigation, legal or administrative proceeding,
or other action is pending or, to the best knowledge of the Borrower,
threatened against or affecting the Borrower or any of its Subsidiaries that
would, if adversely determined, involve liabilities reasonably expected to have
a Material Adverse Effect.
5.6 NO DEFAULT.
Neither the Borrower nor any of its Subsidiaries is in default under or
with respect to any of their contractual obligations in any respect which would
be reasonably expected to have a Material Adverse Effect. No Default or Event
of Default has occurred and is continuing.
5.7 OWNERSHIP OF PROPERTY; LIENS.
Each of the Borrower and its Subsidiaries has good record and marketable
title in fee simple to, or a valid leasehold interest in, all its material real
property, and good title to, or a valid leasehold interest in, all its other
material property, and none of such property is subject to any Lien, except for
Permitted Liens.
5.8 NO BURDENSOME RESTRICTIONS.
Except as previously disclosed in writing to the Lenders on or prior to
the Closing Date, no Requirement of Law or contractual obligation of the
Borrower or any of its Subsidiaries would be reasonably expected to have a
Material Adverse Effect.
5.9 TAXES.
Each of the Borrower and its Subsidiaries has filed or caused to be filed
all United States federal income tax returns and all other material tax returns
which, to the best knowledge of the Borrower, are required to be filed and has
paid (a) all taxes shown to be due and payable on said returns or (b) all taxes
shown to be due and payable on any assessments of which it has received notice
made against it or any of its property and all other taxes, fees or other
charges imposed on it or any of its property by any Governmental Authority
(other than any (i) taxes, fees or other charges with respect to which the
failure to pay, in the aggregate, would not have a Material Adverse Effect or
(ii) taxes, fees or other charges the amount or validity of which are currently
being contested and with respect to which reserves in conformity with GAAP have
been provided on the books of such Person), and no tax Lien has been filed,
and, to the best knowledge of the Borrower, no claim is being asserted, with
respect to any such tax, fee or other charge.
5.10 ERISA.
Except as would not result in a Material Adverse Effect:
(a) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no ERISA Event has occurred,
and, to the best knowledge of the Borrower, no event or condition has
occurred or exists as a result of which any ERISA Event could reasonably
be expected to occur, with respect to any Plan; (ii) no "accumulated
funding deficiency," as such term is defined in Section 302 of ERISA and
Section 412 of the Code, whether or not waived, has occurred with respect
to any Plan; (iii) each Single Employer Plan and, to the best knowledge
of the Borrower, each Multiemployer Plan has been maintained, operated,
and funded in compliance with its own terms and in material compliance
with the provisions of
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ERISA, the Code, and any other applicable federal or state laws; and (iv)
no lien in favor of the PBGC or a Plan has arisen or is reasonably likely
to arise on account of any Plan.
(b) The actuarial present value of all "benefit liabilities" (as
defined in Section 4001(a)(16) of ERISA), whether or not vested, under
each Single Employer Plan, as of the last annual valuation date prior to
the date on which this representation is made or deemed made (determined,
in each case, utilizing the actuarial assumptions used in such Plan's
most recent actuarial valuation report), did not exceed as of such
valuation date the fair market value of the assets of such Plan.
(c) Neither the Borrower, any of the Subsidiaries of the Borrower
nor any ERISA Affiliate has incurred, or, to the best knowledge of the
Borrower, could be reasonably expected to incur, any withdrawal liability
under ERISA to any Multiemployer Plan or Multiple Employer Plan. Neither
the Borrower, any of the Subsidiaries of the Borrower nor any ERISA
Affiliate would become subject to any withdrawal liability under ERISA if
the Borrower, any of the Subsidiaries of the Borrower or any ERISA
Affiliate were to withdraw completely from all Multiemployer Plans and
Multiple Employer Plans as of the valuation date most closely preceding
the date on which this representation is made or deemed made. Neither
the Borrower, any of the Subsidiaries of the Borrower nor any ERISA
Affiliate has received any notification that any Multiemployer Plan is in
reorganization (within the meaning of Section 4241 of ERISA), is
insolvent (within the meaning of Section 4245 of ERISA), or has been
terminated (within the meaning of Title IV of ERISA), and no
Multiemployer Plan is, to the best knowledge of the Borrower, reasonably
expected to be in reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) or breach of fiduciary responsibility
has occurred with respect to a Plan which has subjected or may subject
the Borrower, any of the Subsidiaries of the Borrower or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l) of
ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which the Borrower, any of the Subsidiaries of the
Borrower or any ERISA Affiliate has agreed or is required to indemnify
any person against any such liability.
(e) Neither the Borrower, any Subsidiary of the Borrower nor any
ERISA Affiliates has any material liability with respect to "expected
post-retirement benefit obligations" within the meaning of the Financial
Accounting Standards Board Statement 106.
(f) Neither the execution and delivery of this Credit Agreement nor
the consummation of the financing transactions contemplated thereunder
will involve any transaction which is subject to the prohibitions of
Sections 404, 406 or 407 of ERISA or in connection with which a tax could
be imposed pursuant to Section 4975 of the Code. The representation by
the Borrower in the preceding sentence is made in reliance upon and
subject to the accuracy of the Lenders' representation in Section 10.15
with respect to their source of funds and is subject, in the event that
the source of the funds used by the Lenders in connection with this
transaction is an insurance company's general asset account, to the
application of Prohibited Transaction Class Exemption 95-60, 60 Fed. Reg.
35,925 (1995), compliance with the regulations issued under Section
401(c)(1)(A) of ERISA, or the issuance of any other prohibited
transaction exemption or similar relief, to the effect that assets in an
insurance company's general asset account do not constitute assets of an
"employee benefit plan" within the meaning of Section 3(3) of ERISA of a
"plan" within the meaning of Section 4975(e)(1) of the Code.
5.11 GOVERNMENTAL REGULATIONS, ETC.
(a) No part of the proceeds of the Loans will be used, directly or
indirectly, for the purpose of purchasing or carrying any "margin stock"
in violation of Regulation G or Regulation U. If requested by any Lender
or the Agent, the Borrower will furnish to the Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of
FR Form U-1 referred to in said Regulation U. No indebtedness being
reduced or retired out of the proceeds of the Loans was or will be
incurred for the purpose of purchasing or carrying any margin stock
within the meaning of Regulation U or any "margin security" within the
meaning of Regulation T. "Margin stock" within the meanings of
Regulation U does not constitute more than 25% of the
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value of the consolidated assets of the Borrower and its Subsidiaries.
None of the transactions contemplated by this Credit Agreement (including,
without limitation, the direct or indirect use of the proceeds of the
Loans) will violate or result in a violation of the Securities Act of
1933, as amended, or the Securities Exchange Act of 1934, as amended, or
regulations issued pursuant thereto, or Regulation G, T, U or X.
(b) Neither the Borrower nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act or the Investment Company Act of 1940, each as amended.
In addition, neither the Borrower nor any of its Subsidiaries is (i) an
"investment company" registered or required to be registered under the
Investment Company Act of 1940, as amended, and is not controlled by such
a company, or (ii) a "holding company", or a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company" or of a
"subsidiary" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
(c) Each of the Borrower and its Subsidiaries has obtained all
licenses, permits, franchises or other governmental authorizations
necessary to the ownership of its respective Property and to the conduct
of its business, except where such failure could not reasonably be
expected to have a Material Adverse Effect.
(d) Neither the Borrower nor any of its Subsidiaries is in violation
of any applicable statute, regulation or ordinance of the United States
of America, or of any state, city, town, municipality, county or any
other jurisdiction, or of any agency thereof (including without
limitation, environmental laws and regulations), except where such
violation could not reasonably be expected to have a Material Adverse
Effect.
(e) Each of the Borrower and its Subsidiaries is current with all
material reports and documents, if any, required to be filed with any
state or federal securities commission or similar agency and is in full
compliance in all material respects with all applicable rules and
regulations of such commissions, except where such failure could not
reasonably be expected to have a Material Adverse Effect.
5.12 SUBSIDIARIES.
Schedule 5.12 sets forth all the Subsidiaries of the Borrower at the
Closing Date, the jurisdiction of their organization and the direct or
indirect ownership interest of the Borrower therein.
5.13 PURPOSE OF LOANS.
The proceeds of the Loans hereunder shall be used solely by the Borrower
to (a) to refinance existing Indebtedness of the Borrower under the Existing
Credit Agreements, (b) repurchase stock in the Borrower, (c) to finance
acquisitions to the extent permitted under this Credit Agreement and (d) for
the working capital, commercial paper back up, capital expenditures and other
lawful corporate purposes of the Borrower and its Subsidiaries.
SECTION 6
AFFIRMATIVE COVENANTS
The Borrower hereby covenants and agrees that so long as this Credit
Agreement is in effect or any amounts payable hereunder or under any other
Credit Document shall remain outstanding, and until all of the Commitments
hereunder shall have terminated:
6.1 INFORMATION COVENANTS.
The Borrower will furnish, or cause to be furnished, to the Agent and the
Lenders:
(a) Annual Financial Statements. As soon as available, and in any
event within 100 days after the close of each fiscal year of the Borrower
and its Subsidiaries, a consolidated balance sheet and income
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statement of the Borrower and its Subsidiaries, as of the end of such
fiscal year, together with related consolidated statements of operations
and retained earnings and of cash flows for such fiscal year, setting
forth in comparative form consolidated figures for the preceding fiscal
year, all such financial information described above to be in reasonable
form and detail and audited by Ernst & Young (or independent certified
public accountants of recognized national standing reasonably acceptable
to the Agent) and whose opinion shall be to the effect that such financial
statements have been prepared in accordance with GAAP (except for changes
with which such accountants concur) and shall not be limited as to the
scope of the audit or qualified as to the status of the Borrower and its
Subsidiaries as a going concern.
(b) Quarterly Financial Statements. As soon as available, and in
any event within 50 days after the close of each fiscal quarter of the
Borrower and its Subsidiaries (other than the fourth fiscal quarter, in
which case 100 days after the end thereof) a consolidated balance sheet
and income statement of the Borrower and its Subsidiaries, as of the end
of such fiscal quarter, together with related consolidated statements of
operations and retained earnings and of cash flows for such fiscal
quarter in each case setting forth in comparative form consolidated
figures for the corresponding period of the preceding fiscal year, all
such financial information described above to be in reasonable form and
detail and reasonably acceptable to the Agent, and accompanied by a
certificate of a Financial Officer of the Borrower to the effect that
such quarterly financial statements fairly present in all material
respects the financial condition of the Borrower and its Subsidiaries and
have been prepared in accordance with GAAP, subject to changes resulting
from audit and normal year-end audit adjustments.
(c) Officer's Certificate. At the time of delivery of the financial
statements provided for in Sections 6.1(a) and 6.1(b) above, a
certificate of a Financial Officer of the Borrower substantially in the
form of Schedule 6.1(c), (i) demonstrating compliance with the
Consolidated Leverage Ratio by calculation thereof as of the end of each
such fiscal period and (ii) stating that no Default or Event of Default
exists, or if any Default or Event of Default does exist, specifying the
nature and extent thereof and what action the Borrower proposes to take
with respect thereto.
(d) Reports. Promptly upon transmission or receipt thereof, (a)
copies of any filings and registrations with, and reports to or from, the
Securities and Exchange Commission, or any successor agency, and copies
of all financial statements, proxy statements, notices and reports as the
Borrower or any of its Subsidiaries shall send to its shareholders or to
a holder of any Indebtedness owed by the Borrower or any of its
Subsidiaries in its capacity as such a holder and (b) upon the request of
the Agent, all reports and written information to and from the United
States Environmental Protection Agency, or any state or local agency
responsible for environmental matters, the United States Occupational
Health and Safety Administration, or any state or local agency
responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters.
(e) Notices. Upon obtaining knowledge thereof, the Borrower will
give written notice to the Agent immediately of (a) the occurrence of an
event or condition consisting of a Default or Event of Default, specifying
the nature and existence thereof and what action the Borrower propose to
take with respect thereto, and (b) the occurrence of any of the following
with respect to the Borrower or any of its Subsidiaries (i) the pendency
or commencement of any litigation, arbitral or governmental proceeding
against such Person which if adversely determined is reasonably likely to
have a Material Adverse Effect, (ii) the institution of any proceedings
against such Person with respect to, or the receipt of notice by such
Person of potential liability or responsibility for violation, or alleged
violation of any federal, state or local law, rule or regulation,
including but not limited to, Environmental Laws, the violation of which
would likely have a Material Adverse Effect, or (iii) any notice or
determination concerning the imposition of any withdrawal liability by a
Multiemployer Plan against such Person or any ERISA Affiliate, the
determination that a Multiemployer Plan is, or is expected to be, in
reorganization within the meaning of Title IV of ERISA or the termination
of any Plan.
(f) ERISA. Upon obtaining knowledge thereof, the Borrower will give
written notice to the Agent promptly (and in any event within five
business days) of: (i) of any event or condition, including, but not
limited to, any Reportable Event, that constitutes, or might reasonably
lead to, an ERISA Event; (ii) with
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respect to any Multiemployer Plan, the receipt of notice as prescribed in
ERISA or otherwise of any withdrawal liability assessed against the
Borrower or any of its ERISA Affiliates, or of a determination that any
Multiemployer Plan is in reorganization or insolvent (both within the
meaning of Title IV of ERISA); (iii) the failure to make full payment on
or before the due date (including extensions) thereof of all amounts which
the Borrower, any of the Subsidiaries of the Borrower or any ERISA
Affiliate is required to contribute to each Plan pursuant to its terms and
as required to meet the minimum funding standard set forth in ERISA and
the Code with respect thereto; or (iv) any change in the funding status of
any Plan that reasonably could be expected to have a Material Adverse
Effect, together with a description of any such event or condition or a
copy of any such notice and a statement by a Financial Officer of the
Borrower briefly setting forth the details regarding such event,
condition, or notice, and the action, if any, which has been or is being
taken or is proposed to be taken by the Borrower with respect thereto.
Promptly upon request, the Borrower shall furnish the Agent and the
Lenders with such additional information concerning any Plan as may be
reasonably requested, including, but not limited to, copies of each annual
report/return (Form 5500 series), as well as all schedules and attachments
thereto required to be filed with the Department of Labor and/or the
Internal Revenue Service pursuant to ERISA and the Code, respectively, for
each "plan year" (within the meaning of Section 3(39) of ERISA).
(g) Other Information. With reasonable promptness upon any such
request, such other information regarding the business, properties or
financial condition of the Borrower or any of its Subsidiaries as the
Agent or the Required Lenders may reasonably request.
6.2 PRESERVATION OF EXISTENCE AND FRANCHISES.
Except as would not result in a Material Adverse Effect, the Borrower
will, and will cause each of its Subsidiaries to, do all things necessary to
preserve and keep in full force and effect its existence, rights, franchises and
authority.
6.3 BOOKS AND RECORDS.
The Borrower will, and will cause each of its Subsidiaries to, keep
complete and accurate books and records of its transactions in accordance with
good accounting practices on the basis of GAAP (including the establishment and
maintenance of appropriate reserves).
6.4 COMPLIANCE WITH LAW.
The Borrower will, and will cause each of its Subsidiaries to, comply with
all laws, rules, regulations and orders, and all applicable restrictions imposed
by all Governmental Authorities, applicable to it and its property if
noncompliance with any such law, rule, regulation, order or restriction would
have a Material Adverse Effect.
6.5 PAYMENT OF TAXES AND OTHER INDEBTEDNESS.
Except as otherwise provided pursuant to the terms of the definition of
"Permitted Liens" set forth in Section 1.1, the Borrower will, and will cause
each of its Subsidiaries to, pay and discharge (a) all taxes, assessments and
governmental charges or levies imposed upon it, or upon its income or profits,
or upon any of its properties, before they shall become delinquent, (b) all
lawful claims (including claims for labor, materials and supplies) which, if
unpaid, might give rise to a Lien upon any of its properties, and (c) except as
prohibited hereunder, all of its other Indebtedness as it shall become due.
6.6 INSURANCE.
The Borrower will, and will cause each of its Subsidiaries to, at all
times maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance and casualty insurance) in such
amounts, covering such risks and liabilities and with such deductibles or
self-insurance retentions as are in accordance with normal industry practice.
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6.7 MAINTENANCE OF PROPERTY.
The Borrower will, and will cause each of its Subsidiaries to, maintain
and preserve its properties and equipment material to the conduct of its
business in good repair, working order and condition, normal wear and tear and
casualty and condemnation excepted, and will make, or cause to be made, in such
properties and equipment from time to time all repairs, renewals, replacements,
extensions, additions, betterments and improvements thereto as may be needed or
proper, to the extent and in the manner customary for companies in similar
businesses.
6.8 USE OF PROCEEDS.
The Borrower will use the proceeds of the Loans solely for the purposes
set forth in Section 5.13.
6.9 AUDITS/INSPECTIONS.
Upon reasonable notice and during normal business hours, the Borrower
will, and will cause each of its Subsidiaries to, permit representatives
appointed by the Agent, including, without limitation, independent accountants,
agents, attorneys, and appraisers to visit and inspect its property, including
its books and records, its accounts receivable and inventory, its facilities and
its other business assets, and to make photocopies or photographs thereof and to
write down and record any information such representative obtains and shall
permit the Agent or its representatives to investigate and verify the accuracy
of information provided to the Lenders and to discuss all such matters with the
officers, employees and representatives of such Person.
6.10 CONSOLIDATED LEVERAGE RATIO.
The Borrower shall cause the Consolidated Leverage Ratio to be no greater
than 0.45:1.00 as of the last day of each fiscal quarter (commencing with the
fiscal quarter ending February 15, 1997).
SECTION 7
NEGATIVE COVENANTS
The Borrower hereby covenants and agrees that, so long as this Credit
Agreement is in effect or any amounts payable hereunder or under any other
Credit Document shall remain outstanding, and until all of the Commitments
hereunder shall have terminated:
7.1 LIENS.
The Borrower will not, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Lien with respect to any
of their Property, whether now owned or after acquired, except for Permitted
Liens.
7.2 NATURE OF BUSINESS.
The Borrower will not, nor will it permit any of its Subsidiaries to,
substantively alter the character or conduct of the business conducted by any
such Person as of the Closing Date.
7.3 CONSOLIDATION, MERGER, SALE OR PURCHASE OF ASSETS, ETC.
The Borrower will not, nor will it permit any of its Subsidiaries to:
(a) except in connection with a disposition of assets permitted by
the terms of subsection (c) below, dissolve, liquidate or wind up their
affairs;
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(b) enter into any transaction of merger or consolidation; provided,
however, that, so long as no Default or Event of Default would be
directly or indirectly caused as a result thereof, (i) the Borrower may
merge or consolidate with any of its Subsidiaries provided that the
Borrower is the surviving corporation; (ii) any Subsidiary of the
Borrower may merge or consolidate with any other Subsidiary of the
Borrower; and (iii) the Borrower or any of its Subsidiaries may merge or
consolidate with any Person (other than the Borrower or any of its
Subsidiaries) provided that (A) the Borrower or a Subsidiary of the
Borrower is the surviving corporation and (B) after giving effect on a
pro forma basis to such merger or consolidation, no Default or Event of
Default would exist hereunder;
(c) sell, lease, transfer or otherwise dispose of all or
substantially all of its Property (other than any such sale, lease,
transfer or other disposition by a Subsidiary of the Borrower to the
Borrower or any other Subsidiary of the Borrower); or
(d) except as otherwise permitted by Section 7.3(a) or Section
7.3(b), acquire all or any portion of the capital stock or securities of
any other Person or purchase, lease or otherwise acquire (in a single
transaction or a series of related transactions) all or any substantial
part of the Property of any other Person; provided that the Borrower or
any of its Subsidiaries shall be permitted to make acquisitions of the
type referred to in this Section 7.3(d) provided that after giving effect
on a pro forma basis to any such acquisition (including but not limited
to any Indebtedness to be incurred or assumed by the Borrower or any of
its Subsidiaries in connection therewith), no Default or Event of Default
would exist hereunder.
7.4 FISCAL YEAR.
The Borrower will not, nor will it permit any of its Subsidiaries to,
change its fiscal year without first obtaining the written consent of the
Required Lenders (such consent not to be unreasonably withheld).
SECTION 8
EVENTS OF DEFAULT
8.1 EVENTS OF DEFAULT.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. The Borrower shall
(i) default in the payment when due of any principal of
any of the Loans, or
(ii) default, and such defaults shall continue for five
(5) or more Business Days, in the payment when due of any
interest on the Loans, or of any Fees or other amounts owing
hereunder, under any of the other Credit Documents or in
connection herewith or therewith; or
(b) Representations. Any representation, warranty or
statement made or deemed to be made by the Borrower herein, in any
of the other Credit Documents, or in any statement or certificate
delivered or required to be delivered pursuant hereto or thereto
shall prove untrue in any material respect on the date as of which
it was deemed to have been made; or
(c) Covenants. The Borrower shall
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(i) default in the due performance or observance of any
term, covenant or agreement contained in Sections 6.2, 6.8,
6.10 or 7.1 through 7.3, inclusive, or
(ii) default in the due performance or observance by it
of any term, covenant or agreement (other than those
referred to in subsections (a), (b) or (c)(i) of this
Section 8.1) contained in this Credit Agreement and such
default shall continue unremedied for a period of at least
30 days after the earlier of a responsible officer of the
Borrower becoming aware of such default or notice thereof by
the Agent; or
(d) Bankruptcy, etc. Any Bankruptcy Event shall occur with
respect to the Borrower or any of its Subsidiaries; or
(e) Other Indebtedness. With respect to any Indebtedness
(other than Indebtedness outstanding under this Credit Agreement
or owing to the Borrower or any of its Subsidiaries) in excess of
$10,000,000 in the aggregate for the Borrower and its Subsidiaries
taken as a whole, (i) the Borrower or any of its Subsidiaries
shall (A) default in any payment (beyond the applicable grace
period with respect thereto, if any) with respect to any such
Indebtedness, or (B) the occurrence and continuance of a default
in the observance or performance relating to such Indebtedness or
contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event or condition shall occur or
condition exist, the effect of which default or other event or
condition is to cause, or permit, the holder or holders of such
Indebtedness (or trustee or agent on behalf of such holders) to
cause, any such Indebtedness to become due prior to its stated
maturity but after the expiration of all applicable grace periods;
or (ii) any such Indebtedness shall be declared due and payable,
or required to be prepaid other than by a regularly scheduled
required prepayment, prior to the stated maturity thereof and
shall not be repaid when due; or
(f) Judgments. One or more judgments or decrees shall be
entered against the Borrower or any of its Subsidiaries involving
a liability of $10,000,000 or more in the aggregate (to the extent
not paid or covered by insurance) and any such judgments or
decrees shall not have been vacated, discharged or stayed or
bonded pending appeal within 30 days from the entry thereof; or
(g) ERISA. Any of the following events or conditions, if such event
or condition reasonably could be expected to have a Material Adverse
Effect: (1) any "accumulated funding deficiency," as such term is defined
in Section 302 of ERISA and Section 412 of the Code, whether or not
waived, shall exist with respect to any Plan, or any lien shall arise on
the assets of the Borrower, any Subsidiary of the Borrower or any ERISA
Affiliate in favor of the PBGC or a Plan; (2) an ERISA Event shall occur
with respect to a Single Employer Plan, which is, in the reasonable
opinion of the Agent, likely to result in the termination of such Plan for
purposes of Title IV of ERISA; (3) an ERISA Event shall occur with respect
to a Multiemployer Plan or Multiple Employer Plan, which is, in the
reasonable opinion of the Agent, likely to result in (i) the termination
of such Plan for purposes of Title IV of ERISA, or (ii) the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate incurring any liability
in connection with a withdrawal from, reorganization of (within the
meaning of Section 4241 of ERISA), or insolvency or (within the meaning of
Section 4245 of ERISA) such Plan; or (4) any prohibited transaction
(within the meaning of Section 406 of ERISA or Section 4975 of the Code)
or breach of fiduciary responsibility shall occur which may subject the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate to any
liability under Sections 406, 409, 502(i), or 502(l) of ERISA or Section
4975 of the Code, or under any agreement or other instrument pursuant to
which the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
has agreed or is required to indemnify any person against any such
liability.
8.2 ACCELERATION; REMEDIES.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived by the Required Lenders
or cured to the satisfaction of the Required Lenders (pursuant to the voting
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procedures in Section 10.6), the Agent shall, upon the request and direction of
the Required Lenders, by written notice to the Borrower take any of the
following actions:
(a) Termination of Commitments. Declare the Commitments
terminated whereupon the Commitments shall be immediately
terminated.
(b) Acceleration. Declare the unpaid principal of and any
accrued interest in respect of all Loans and any and all other
indebtedness or obligations of any and every kind owing by the
Borrower to the Agent and/or any of the Lenders hereunder to be
due whereupon the same shall be immediately due and payable
without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower.
(c) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Credit Documents and all
rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
8.1(d) shall occur, then the Commitments shall automatically terminate and all
Loans, all accrued interest in respect thereof, all accrued and unpaid Fees and
other indebtedness or obligations owing to the Agent and/or any of the Lenders
hereunder automatically shall immediately become due and payable without the
giving of any notice or other action by the Agent or the Lenders.
SECTION 9
AGENCY PROVISIONS
9.1 APPOINTMENT.
Each Lender hereby designates and appoints NationsBank, N.A. as
administrative agent (in such capacity as Agent hereunder, the "Agent") of such
Lender to act as specified herein and the other Credit Documents, and each such
Lender hereby authorizes the Agent as the agent for such Lender, to take such
action on its behalf under the provisions of this Credit Agreement and the other
Credit Documents and to exercise such powers and perform such duties as are
expressly delegated by the terms hereof and of the other Credit Documents,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere herein and in the other
Credit Documents, the Agent shall not have any duties or responsibilities,
except those expressly set forth herein and therein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or any of the other Credit Documents, or shall otherwise exist
against the Agent. The provisions of this Section are solely for the benefit of
the Agent and the Lenders and the Borrower shall have no rights as a third party
beneficiary of the provisions hereof. In performing its functions and duties
under this Credit Agreement and the other Credit Documents, the Agent shall act
solely as agent of the Lenders and does not assume and shall not be deemed to
have assumed any obligation or relationship of agency or trust with or for the
Borrower or any of its Affiliates.
9.2 DELEGATION OF DUTIES.
The Agent may execute any of its respective duties hereunder or under the
other Credit Documents by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties;
provided that the use of any agents or attorneys-in-fact shall not relieve the
Agent of its duties hereunder.
9.3 EXCULPATORY PROVISIONS.
The Agent and its officers, directors, employees, agents,
attorneys-in-fact or affiliates shall not be (a) liable for any action lawfully
taken or omitted to be taken by it or such Person under or in connection
herewith or in connection with any of the other Credit Documents (except for
its or such Person's own gross negligence or willful misconduct), or (b)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the
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Borrower contained herein or in any of the other Credit Documents or in any
certificate, report, document, financial statement or other written or oral
statement referred to or provided for in, or received by the Agent under or in
connection herewith or in connection with the other Credit Documents, or
enforceability or sufficiency therefor of any of the other Credit Documents, or
for any failure of the Borrower to perform its obligations hereunder or
thereunder. The Agent shall not be responsible to any Lender for the
effectiveness, genuineness, validity, enforceability, collectability or
sufficiency of this Credit Agreement, or any of the other Credit Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by the Borrower in any written or oral statement or in any
financial or other statements, instruments, reports, certificates or any other
documents in connection herewith or therewith furnished or made by the Agent to
the Lenders or by or on behalf of the Borrower to the Agent or any Lender or be
required to ascertain or inquire as to the performance or observance of any of
the terms, conditions, provisions, covenants or agreements contained herein or
therein or as to the use of the proceeds of the Loans or of the existence or
possible existence of any Default or Event of Default or to inspect the
properties, books or records of the Borrower or any of its Affiliates.
9.4 RELIANCE ON COMMUNICATIONS.
The Agent shall be entitled to rely, and shall be fully protected in
relying, upon any note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document or conversation reasonably believed by it to
be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Borrower, independent accountants and other
experts selected by the Agent with reasonable care). The Agent may deem and
treat the Lenders as the owner of their respective interests hereunder for all
purposes unless a written notice of assignment, negotiation or transfer thereof
shall have been filed with the Agent in accordance with Section 10.3(b) hereof.
The Agent shall be fully justified in failing or refusing to take any action
under this Credit Agreement or under any of the other Credit Documents unless
it shall first receive such advice or concurrence of the Required Lenders as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it
by reason of taking or continuing to take any such action. The Agent shall in
all cases be fully protected in acting, or in refraining from acting, hereunder
or under any of the other Credit Documents in accordance with a request of the
Required Lenders (or to the extent specifically provided in Section 10.6, all
the Lenders) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders (including their successors and
assigns).
9.5 NOTICE OF DEFAULT.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default hereunder unless the Agent has
received notice from a Lender or the Borrower referring to the Credit Document,
describing such Default or Event of Default and stating that such notice is a
"notice of default." In the event that the Agent receives such a notice, the
Agent shall give prompt notice thereof to the Lenders. The Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders.
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9.6 NON-RELIANCE ON AGENT AND OTHER LENDERS.
Each Lender expressly acknowledges that each of the Agent and its
officers, directors, employees, agents, attorneys-in-fact or affiliates has not
made any representations or warranties to it and that no act by the Agent or
any affiliate thereof hereinafter taken, including any review of the affairs of
the Borrower or any of its Affiliates, shall be deemed to constitute any
representation or warranty by the Agent to any Lender. Each Lender represents
to the Agent that it has, independently and without reliance upon the Agent or
any other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Borrower or its Affiliates and made its own decision to
make its Loans hereunder and enter into this Credit Agreement. Each Lender
also represents 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 analysis,
appraisals and decisions in taking or not taking action under this Credit
Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Borrower and its Affiliates.
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Agent hereunder, the Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, assets, property, financial or
other conditions, prospects or creditworthiness of the Borrower or any of its
Affiliates which may come into the possession of the Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates.
9.7 INDEMNIFICATION.
The Lenders agree to indemnify the Agent in its capacity as such (to the
extent not reimbursed by the Borrower and without limiting the obligation of
the Borrower to do so), ratably according to their respective Commitments (or
if the Commitments have expired or been terminated, in accordance with the
respective principal amounts of outstanding Loans and Participation Interests
of the Lenders), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including without limitation at
any time following the final payment of all of the obligations of the Borrower
hereunder and under the other Credit Documents) be imposed on, incurred by or
asserted against the Agent in its capacity as such in any way relating to or
arising out of this Credit Agreement or the other Credit Documents or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the gross negligence or willful misconduct of the
Agent. If any indemnity furnished to the Agent for any purpose shall, in the
opinion of the Agent, be insufficient or become impaired, the Agent may call
for additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished. The agreements in this
Section shall survive the repayment of the Loans and other obligations under
the Credit Documents and the termination of the Commitments hereunder.
9.8 AGENT IN ITS INDIVIDUAL CAPACITY.
The Agent and its affiliates may make loans to, accept deposits from and
generally engage in any kind of business with the Borrower, its Subsidiaries or
their respective Affiliates as though the Agent were not the Agent hereunder.
With respect to the Loans made by and all obligations of the Borrower hereunder
and under the other Credit Documents, the Agent shall have the same rights and
powers under this Credit Agreement as any Lender and may exercise the same as
though it were not the Agent, and the terms "Lender" and "Lenders" shall
include the Agent in its individual capacity.
9.9 SUCCESSOR AGENT.
The Agent may, at any time, resign upon 20 days' written notice to the
Lenders, and may be removed, upon show of cause, by the Required Lenders upon
30 days' written notice to the Agent. Upon any such resignation or removal,
the Required Lenders shall have the right to appoint a successor Agent;
provided that, so long as no Default or Event of Default has occurred and is
continuing, such successor Agent shall be reasonably acceptable to the
Borrower. If
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no successor Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
notice of resignation or notice of removal, as appropriate, then the retiring
Agent shall select a successor Agent provided such successor is a Lender
hereunder or a commercial bank organized under the laws of the United States of
America or of any State thereof and has a combined capital and surplus of at
least $400,000,000. Upon the acceptance of any appointment as Agent hereunder
by a successor, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations as Agent, as appropriate, under this Credit Agreement and the other
Credit Documents and the provisions of this Section 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Credit Agreement.
9.10 CO-AGENT.
The Co-Agent, in its capacity as such, shall have no rights, powers,
duties or obligations under this Credit Agreement or any of the other Credit
Documents.
SECTION 10
MISCELLANEOUS
10.1 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (i) when
delivered, (ii) when transmitted via telecopy (or other facsimile device) to
the number set out below, (iii) the day following the day on which the same has
been delivered prepaid to a reputable national overnight air courier service,
or (iv) the third Business Day following the day on which the same is sent by
certified or registered mail, postage prepaid, in each case to the respective
parties at the address, in the case of the Borrower and the Agent, set forth
below, and, in the case of the Lenders, set forth on Schedule 2.1(a), or at
such other address as such party may specify by written notice to the other
parties hereto:
if to the Borrower:
AutoZone, Inc.
123 South Front Street
Memphis, TN 38103
Attn: Chief Financial Officer
Telephone: (901) 495-7181
Telecopy: (901) 495-8317
with a copy to the Treasurer and to the General Counsel for the
Borrower at the same address;
if to the Agent:
NationsBank, N.A.
Independence Center, 15th Floor
NC1-001-15-04
101 N. Tryon Street
Charlotte, North Carolina 28255
Attn: Agency Services
Telephone:(704) 388-3917
Telecopy:(704) 386-9923
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44
with a copy to:
NationsBank, N.A.
NationsBank Corporate Center
NC1-007-8-7
100 N. Tryon Street
Attn: John E. Ball
Telephone: (704) 386-9718
Telecopy: (704) 388-0373
10.2 RIGHT OF SET-OFF.
In addition to any rights now or hereafter granted under applicable law ,
and not by way of limitation of any such rights, upon the occurrence of an Event
of Default, each Lender is authorized at any time and from time to time, without
presentment, demand, protest or other notice of any kind (all of which rights
being hereby expressly waived), to set-off and to appropriate and apply any and
all deposits (general or special) and any other indebtedness at any time held or
owing by such Lender (including, without limitation branches, agencies or
Affiliates of such Lender wherever located) to or for the credit or the account
of the Borrower against obligations and liabilities of such Person to such
Lender hereunder, under the Notes or the other Credit Documents , irrespective
of whether such Lender shall have made any demand hereunder and although such
obligations, liabilities or claims, or any of them, may be contingent or
unmatured, and any such set-off shall be deemed to have been made immediately
upon the occurrence of an Event of Default even though such charge is made or
entered on the books of such Lender subsequent thereto. Any Person purchasing
a participation in the Loans and Commitments hereunder pursuant to Section 3.13
or Section 10.3(d) may exercise all rights of set-off with respect to its
participation interest as fully as if such Person were a Lender hereunder.
10.3 BENEFIT OF AGREEMENT.
(a) Generally. This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that the Borrower may not
assign or transfer any of its interests without prior written consent of
the Lenders; provided further that the rights of each Lender to transfer,
assign or grant participations in its rights and/or obligations hereunder
shall be limited as set forth in this Section 10.3, provided however that
nothing herein shall prevent or prohibit any Lender from (i) pledging its
Loans hereunder to a Federal Reserve Bank in support of borrowings made
by such Lender from such Federal Reserve Bank, or (ii) granting
assignments or selling participations in such Lender's Loans and/or
Commitments hereunder to its parent company and/or to any Affiliate or
Subsidiary of such Lender.
(b) Assignments. Each Lender may assign all or a portion of its
rights and obligations hereunder, pursuant to an assignment agreement
substantially in the form of Schedule 10.3(b), to (i) any Lender or any
Affiliate or Subsidiary of a Lender, or (ii) any other commercial bank,
financial institution or "accredited investor" (as defined in Regulation
D of the Securities and Exchange Commission) that, so long as no Default
or Event of Default has occurred and is continuing, is reasonably
acceptable to the Borrower; provided that (i) any such assignment (other
than any assignment to an existing Lender) shall be in a minimum
aggregate amount of $5,000,000 (or, if less, the remaining amount of the
Commitment being assigned by such Lender) of the Commitments and in
integral multiples of $1,000,000 above such amount, (ii) so long as no
Event of Default has occurred and is continuing, no Lender shall assign
more than 50% of such Lender's original Revolving Commitment and (iii)
each such assignment shall be of a constant, not varying, percentage of
all such Lender's rights and obligations under this Credit Agreement.
Any assignment hereunder shall be effective upon delivery to the Agent of
written notice of the assignment together with a transfer fee of $3,500
payable to the Agent for its own account from and after the later of (i)
the effective date specified in the applicable assignment agreement and
(ii) the date of recording of such assignment in the Register pursuant to
the terms of subsection (c) below. The assigning Lender will give prompt
notice to the Agent and the Borrower of any such assignment. Upon the
effectiveness of any such assignment (and after notice to, and (to the
extent required pursuant to the terms hereof), with the consent of, the
Borrower as provided herein), the assignee shall become a
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"Lender" for all purposes of this Credit Agreement and the other Credit
Documents and, to the extent of such assignment, the assigning Lender
shall be relieved of its obligations hereunder to the extent of the Loans
and Commitment components being assigned. Along such lines the Borrower
agrees that upon notice of any such assignment and surrender of the
appropriate Note or Notes, it will promptly provide to the assigning
Lender and to the assignee separate promissory notes in the amount of
their respective interests substantially in the form of the original Note
(but with notation thereon that it is given in substitution for and
replacement of the original Note or any replacement notes thereof). By
executing and delivering an assignment agreement in accordance with this
Section 10.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and the
other parties hereto as follows: (i) such assigning Lender warrants that
it is the legal and beneficial owner of the interest being assigned
thereby free and clear of any adverse claim; (ii) except as set forth in
clause (i) above, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Credit
Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Credit
Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto or the financial condition
of the Borrower or any of its respective Affiliates or the performance or
observance by the Borrower of any of its obligations under this Credit
Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto; (iii) such assignee
represents and warrants that it is legally authorized to enter into such
assignment agreement; (iv) such assignee confirms that it has received a
copy of this Credit Agreement, the other Credit Documents and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such assignment agreement; (v)
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 Credit
Agreement and the other Credit Documents; (vi) such assignee appoints and
authorizes the Agent to take such action on its behalf and to exercise
such powers under this Credit Agreement or any other Credit Document as
are delegated to the Agent by the terms hereof or thereof, together with
such powers as are reasonably incidental thereto; and (vii) such assignee
agrees that it will perform in accordance with their terms all the
obligations which by the terms of this Credit Agreement and the other
Credit Documents are required to be performed by it as a Lender.
(c) Maintenance of Register. The Agent shall maintain at one of its
offices in Charlotte, North Carolina (i) a copy of each New Commitment
Agreement, (ii) a copy of each Lender assignment agreement delivered to
it in accordance with the terms of subsection (b) above and (iii) a
register for the recordation of the identity of the principal amount,
type and Interest Period of each Loan outstanding hereunder, the names,
addresses and the Commitments of the Lenders pursuant to the terms hereof
from time to time (the "Register"). The Agent will make reasonable
efforts to maintain the accuracy of the Register and to promptly update
the Register from time to time, as necessary. The Register shall be
prima facie, but not conclusive, evidence of the information contained
therein and the Borrower, the Agent and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Credit Agreement. The Register
shall be available for inspection by the Borrower and each Lender, at any
reasonable time and from time to time upon reasonable prior notice.
(d) Participations. Each Lender may sell, transfer, grant or assign
participations in all or any part of such Lender's interests and
obligations hereunder; provided that (i) such selling Lender shall remain
a "Lender" for all purposes under this Credit Agreement (such selling
Lender's obligations under the Credit Documents remaining unchanged) and
the participant shall not constitute a Lender hereunder, (ii) no such
participant shall have, or be granted, rights to approve any amendment or
waiver relating to this Credit Agreement or the other Credit Documents
except to the extent any such amendment or waiver would (A) reduce the
principal of or rate of interest on or Fees in respect of any Loans in
which the participant is participating or (B) postpone the date fixed for
any payment of principal (including extension of the Termination Date or
the date of any mandatory prepayment), interest or Fees in which the
participant is participating, and (iii) sub-participations by the
participant (except to an affiliate, parent company or affiliate of a
parent company of the participant) shall be prohibited. In the case of
any such participation, the participant
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shall not have any rights under this Credit Agreement or the other Credit
Documents (the participant's rights against the selling Lender in respect
of such participation to be those set forth in the participation agreement
with such Lender creating such participation) and all amounts payable by
the Borrower hereunder shall be determined as if such Lender had not sold
such participation, provided, however, that such participant shall be
entitled to receive additional amounts under Sections 3.6, 3.9 and 3.11 on
the same basis as if it were a Lender provided that it shall not be
entitled to receive any more than the selling Lender would have received
had it not sold the participation.
10.4 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Agent or any Lender in exercising
any right, power or privilege hereunder or under any other Credit Document and
no course of dealing between the Agent or any Lender and the Borrower shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or under any other Credit Document preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder or thereunder. The rights and remedies provided herein
are cumulative and not exclusive of any rights or remedies which the Agent or
any Lender would otherwise have. No notice to or demand on the Borrower in any
case shall entitle the Borrower to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of the Agent
or the Lenders to any other or further action in any circumstances without
notice or demand.
10.5 PAYMENT OF EXPENSES, ETC.
The Borrower agrees to: (a) pay all reasonable out-of-pocket costs and
expenses (i) of the Agent in connection with the negotiation, preparation,
execution and delivery and administration of this Credit Agreement and the
other Credit Documents and the documents and instruments referred to therein
(including, subject to agreed upon limitations, the reasonable fees and
expenses of Moore & Van Allen, PLLC, special counsel to the Agent) and any
amendment, waiver or consent relating hereto and thereto including, but not
limited to, any such amendments, waivers or consents resulting from or related
to any work-out, renegotiation or restructure relating to the performance by
the Borrower under this Credit Agreement and (ii) of the Agent and the Lenders
in connection with enforcement of the Credit Documents and the documents and
instruments referred to therein (including, without limitation, in connection
with any such enforcement, the reasonable fees and disbursements of counsel
(including allocated costs of internal counsel) for the Agent and each of the
Lenders); (b) pay and hold each of the Lenders harmless from and against any
and all future stamp and other similar taxes with respect to the foregoing
matters and save each of the Lenders harmless from and against any and all
liabilities with respect to or resulting from any delay or omission (other than
to the extent attributable to such Lender) to pay such taxes; and (c) indemnify
each Lender, its officers, directors, employees, representatives and agents
from and hold each of them harmless against any and all losses, liabilities,
claims, damages or expenses incurred by any of them as a result of, or arising
out of, or in any way related to, or by reason of (i) any investigation,
litigation or other proceeding (whether or not any Lender is a party thereto,
but excluding any investigation initiated by the Person seeking indemnification
hereunder) related to the entering into and/or performance of any Credit
Document or the use of proceeds of any Loans (including other extensions of
credit) hereunder or the consummation of any other transactions contemplated in
any Credit Document, including, without limitation, the reasonable fees and
disbursements of counsel (including allocated costs of internal counsel)
incurred in connection with any such investigation, litigation or other
proceeding or (ii) the presence or Release of any Materials of Environmental
Concern at, under or from any Property owned, operated or leased by the
Borrower or any of its Subsidiaries, or the failure by the Borrower or any of
its Subsidiaries to comply with any Environmental Law (but excluding, in the
case of either of clause (i) or (ii) above, any such losses, liabilities,
claims, damages or expenses to the extent (A) incurred by reason of gross
negligence or willful misconduct on the part of the Person to be indemnified,
(B) owing to the Borrower or (C) owing to another Person entitled to
indemnification hereunder).
10.6 AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Credit Agreement nor any other Credit Document nor any of the
terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is
in writing entered into by, or approved in writing by, the Required Lenders and
the Borrower, provided, however, that:
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(a) no such amendment, change, waiver, discharge or termination
shall, without the consent of each Lender directly affected thereby, (i)
reduce the rate or extend the time of payment of interest (other than as
a result of waiving the applicability of any post-default increase in
interest rates) on any Loan or fees hereunder, (ii) reduce the rate or
extend the time of payment of any fees owing hereunder, (iii) extend (A)
the Commitments of the Lenders, or (B) the final maturity of any Loan, or
any portion thereof, or (iv) reduce the principal amount on any Loan;
(b) no such amendment, change, waiver, discharge or termination
shall, without the consent of each Lender directly affected thereby, (i)
except as otherwise permitted under Section 3.4(b), increase the
Commitments of the Lenders over the amount thereof in effect (it being
understood and agreed that a waiver of any Default or Event of Default
shall not constitute a change in the terms of any Commitment of any
Lender), (ii) amend, modify or waive any provision of this Section 10.6
or Section 3.6, 3.10, 3.11, 3.12, 3.13, 8.1(a), 10.2, 10.3, 10.5 or 10.9,
(iii) reduce or increase any percentage specified in, or otherwise
modify, the definition of "Required Lenders," or (iv) consent to the
assignment or transfer by the Borrower of any of its rights and
obligations under (or in respect of) the Credit Documents to which it is
a party;
(c) no provision of Section 2.3 may be amended without the consent
of the Swingline Lender and no provision of Section 9 may be amended
without the consent of the Agent; and
(d) designation of the Master Account or of any Financial Officer
may not be made without the written consent of at least two Financial
Officers of the Borrower.
10.7 COUNTERPARTS.
This Credit Agreement may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Credit Agreement to produce or account for more than one
such counterpart.
10.8 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
10.9 SURVIVAL.
All indemnities set forth herein, including, without limitation, in
Section 3.9, 3.11, 9.7 or 10.5 shall survive the execution and delivery of this
Credit Agreement, the making of the Loans, the repayment of the Loans and other
obligations under the Credit Documents and the termination of the Commitments
hereunder, and all representations and warranties made by the Borrower herein
shall survive delivery of the Notes and the making of the Loans hereunder.
10.10 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
(a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NORTH CAROLINA. Any legal action or proceeding with respect
to this Credit Agreement or any other Credit Document may be brought in
the courts of the State of North Carolina in Mecklenburg County, or of the
United States for the Western District of North Carolina, and, by
execution and delivery of this Credit Agreement, the Borrower hereby
irrevocably accepts for itself and in respect of its property, generally
and unconditionally, the nonexclusive jurisdiction of such courts. The
Borrower further irrevocably consents to the service of process out of any
of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage
prepaid, to it at the address set out for notices pursuant to Section
10.1, such service to become effective three (3) days after such mailing.
Nothing
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herein shall affect the right of the Agent to serve process in any other
manner permitted by law or to commence legal proceedings or to otherwise
proceed against the Borrower in any other jurisdiction.
(b) The Borrower hereby irrevocably waives any objection which it
may now or hereafter have to the laying of venue of any of the aforesaid
actions or proceedings arising out of or in connection with this Credit
Agreement or any other Credit Document brought in the courts referred to
in subsection (a) hereof and hereby further irrevocably waives and agrees
not to plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an inconvenient
forum.
(c) TO THE EXTENT PERMITTED BY LAW, EACH OF THE AGENT, THE LENDERS
AND THE BORROWER HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
10.11 SEVERABILITY.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
10.12 ENTIRETY.
This Credit Agreement together with the other Credit Documents represent
the entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
10.13 BINDING EFFECT; TERMINATION.
(a) This Credit Agreement shall become effective at such time on or
after the Closing Date when it shall have been executed by the Borrower
and the Agent, and the Agent shall have received copies hereof (telefaxed
or otherwise) which, when taken together, bear the signatures of each
Lender, and thereafter this Credit Agreement shall be binding upon and
inure to the benefit of the Borrower, the Agent and each Lender and their
respective successors and assigns.
(b) The term of this Credit Agreement shall be until no Loans or any
other amounts payable hereunder or under any of the other Credit
Documents shall remain outstanding and until all of the Commitments
hereunder shall have expired or been terminated.
10.14 CONFIDENTIALITY.
The Agent and the Lenders agree to keep confidential (and to cause their
respective affiliates, officers, directors, employees, agents and
representatives to keep confidential) all information, materials and documents
furnished to the Agent or any such Lender by or on behalf of the Borrower
(whether before or after the Closing Date) which relates to the Borrower or any
of its Subsidiaries (the "Information"). Notwithstanding the foregoing, the
Agent and each Lender shall be permitted to disclose Information (i) to its
affiliates, officers, directors, employees, agents and representatives in
connection with its participation in any of the transactions evidenced by this
Credit Agreement or any other Credit Documents or the administration of this
Credit Agreement or any other Credit Documents; (ii) to the extent required by
applicable laws and regulations or by any subpoena or similar legal process, or
requested by any Governmental Authority; (iii) to the extent such Information
(A) becomes publicly available other than as a result of a breach of this
Credit Agreement or any agreement entered into pursuant to clause (iv) below,
(B) becomes available to the Agent or such Lender on a non-confidential basis
from a source other than the Borrower or (C) was available to the Agent or such
Lender on a non-confidential basis prior to its disclosure to the Agent or such
Lender by the Borrower; (iv) to any
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assignee or participant (or prospective assignee or participant) so long as such
assignee or participant (or prospective assignee or participant) first
specifically agrees in a writing furnished to and for the benefit of the
Borrower to be bound by the terms of this Section 10.14; or (v) to the extent
that the Borrower shall have consented in writing to such disclosure. Nothing
set forth in this Section 10.14 shall obligate the Agent or any Lender to return
any materials furnished by the Borrower.
10.15 SOURCE OF FUNDS.
Each of the Lenders hereby represents and warrants to the Borrower that at
least one of the following statements is an accurate representation as to the
source of funds to be used by such Lender in connection with the financing
hereunder:
(a) no part of such funds constitutes assets allocated to any
separate account maintained by such Lender in which any employee
benefit plan (or its related trust) has any interest;
(b) to the extent that any part of such funds constitutes
assets allocated to any separate account maintained by such Lender,
such Lender has disclosed to the Borrower the name of each employee
benefit plan whose assets in such account exceed 10% of the total
assets of such account as of the date of such purchase (and, for
purposes of this subsection (b), all employee benefit plans
maintained by the same employer or employee organization are deemed
to be a single plan);
(c) to the extent that any part of such funds constitutes
assets of an insurance company's general account, such insurance
company has complied with all of the requirements of the
regulations issued under Section 401(c)(1)(A) of ERISA; or
(d) such funds constitute assets of one or more specific
benefit plans which such Lender has identified in writing to the
Borrower.
As used in this Section 10.15, the terms "employee benefit plan" and "separate
account" shall have the respective meanings assigned to such terms in Section 3
of ERISA.
10.16 CONFLICT.
To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Credit Agreement shall control.
[Signature Pages to Follow]
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of
this Credit Agreement to be duly executed and delivered as of the date first
above written.
BORROWER: AUTOZONE, INC.
- -------- --------------
a Nevada corporation
By: /s/ Robert J. Hunt
Name: Robert J. Hunt
Title: Executive Vice President & Chief Financial Officer
By: /s/ Harry L. Goldsmith
Name: Harry L. Goldsmith
Title: Senior Vice President
LENDERS: NATIONSBANK, N.A.,
- ---------
individually in its capacity as a
Lender and in its capacity as Agent
By: /s/ Kimberly R. Dupuy
Name: Kimberly R. Dupuy
Title: Vice President
SUNTRUST BANK, NASHVILLE, N.A.,
individually in its capacity as a
Lender and in its capacity as Co-Agent
By: /s/ Bryan W. Ford
Name: Bryan W. Ford
Title: Vice President
BANK OF AMERICA ILLINOIS
By: /s/ Robert A. Kilgannon
Name: Robert A. Kilgannon
Title: Senior Vice President
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Catherine A. Muszynski
Name: Catherine A. Muszynski
Title: Assistant Vice President
FIRST UNION NATIONAL BANK
By: /s/ Orville W. Kronk
Name: Orville W. Kronk
Title: Vice President
S-1
51
Signature Page to AutoZone, Inc. Credit Agreement
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
By: /s/ James H. Moore, Jr.
Name: James H. Moore, Jr.
Title: Vice President
UNITED STATES NATIONAL BANK OF OREGON
By: /s/ Stephen Mitchell
Name: Stephen Mitchell
Title: Vice President
UNION PLANTERS NATIONAL BANK
By: /s/ Leonard L. McKinnon
Name: Leonard L. McKinnon
Title: Vice President
S-2
52
SCHEDULE 1.1A
APPLICABLE PERCENTAGE
Applicable Margin Applicable Percentage
Pricing S&P/Moody's Consolidated for for
Level Rating Leverage Ratio Eurodollar Loans Facility Fee
- --------- ------------------- -------------------- ----------------- ---------------------
Level I AA/Aa2 or above N.A. 12.5 bps [6.25 bps]
Level II A/A2 or above Less than or equal 15.0 bps [7.0 bps]
to 0.25:1.00
Level III BBB+/Baa1 or above Greater than 0.25:1.00, 18.5 bps [9.0 bps]
but less than or
equal to 0.35:1.00
Level IV BBB/Baa2 or above Greater than 0.35:1.00, 25.0 bps [12.5 bps]
but less than or
equal to 0.40:1.00
Level V BBB-/Baa3 Greater than 0.40:1.00 35.0 bps [15.0 bps]
If no Rating exists, the applicable Pricing Level shall be based on the
Consolidated Leverage Ratio. In the event of a Split Rating, the applicable
Pricing Level shall be based on the higher Rating. In the event of a Double
Split Rating, the applicable Pricing Level shall be based on the Pricing Level
which is one above that corresponding to the lower Rating. If the ratings and
the Consolidated Leverage Ratio indicate different Pricing Levels, the
applicable Pricing Level is the numerically lower of the two, except in the
instance of Pricing Level I where the Consolidated Leverage Ratio shall have no
effect.
As used herein:
"Rating" means the senior unsecured (non-credit enhanced) long term debt rating
of the Borrower, as published by S&P and/or Moody's.
"Split Rating" means the ratings of S&P and Moody's would indicate different
Pricing Levels, but the Pricing Levels are not more than one Pricing Level
apart.
"Double Split Rating" means the ratings of S&P and Moody's would indicate
different Pricing Levels, but the Pricing Levels are two or more Pricing Levels
apart.
53
SCHEDULE 2.1(A)
LENDERS
Commitment Revolving
Lender Percentage Commitment
------ ---------- ----------
NationsBank, N.A. 18.18181818% $ 50,000,000.00
NationsBank Corporate Center
NC1007-8-7
Charlotte, NC 28255
Attn: Jeb Ball
Tel: (704) 386-9718
Fax: (704) 388-0373
SunTrust Bank, Nashville, N.A. 16.36363636% $ 45,000,000.00
6410 Poplar Avenue
Suite 320
Memphis, TN 38119
Attn: Bryan W. Ford
Tel: (901) 766-7561
Fax: (901) 766-7565
Bank of America Illinois 14.54545455% $ 40,000,000.00
1230 Peachtree Street
Suite 3800
Atlanta, GA 30309
Attn: Roger Hunt
Tel: (404) 249-6966
Fax: (404) 249-6938
The First National Bank of Chicago 14.54545455% $ 40,000,000.00
One First National Plaza
Mail Suite 0086
Chicago, IL 60670-0324
Attn: Cathy Muszynski
Tel: (312) 732-7634
Fax: (312) 732-1117
First Union National Ban 12.72727272% $ 35,000,000.00
150 4th Avenue
2nd Floor
Nashville, TN 37219
Attn: Larry Fuschino
Tel: (615) 251-0857
Fax: (615) 251-0894
United States National Bank of Oregon 12.72727272% $ 35,000,000.00
555 S.W. Oak Street
Suite 400
Portland, OR 97204
Attn: Stephen Mitchell
Tel: (503) 275-4497
Fax: (503) 275-4267
- 1-
54
First Tennessee Bank National Association 5.454545455% $ 15,000,000.00
165 Madison Avenue, 9th Floor
Memphis, TN 38103
Attn: Joe Evangelisti
Tel: (901) 523-4108
Fax: (901) 523-4267 5.454545455% $ 15,000,000.00
Union Planters National Bank
6200 Poplar Avenue
4th Floor
Memphis, TN 38119
Tel: (901) 580-5481
Fax: (901) 580-5451
Total: 100% $275,000,000.00
- 2-
55
SCHEDULE 2.1(B)(I)
FORM OF NOTICE OF BORROWING
NationsBank, N.A.,
as Agent for the Lenders
101 N. Tryon Street
Independence Center, 15th Floor
NC1-001-15-04
Charlotte, North Carolina 28255
Attention: Agency Services
Ladies and Gentlemen:
The undersigned, AUTOZONE, INC. (the "Borrower"), refers to the Credit
Agreement dated as of December 20, 1996 (as amended, modified, extended or
restated from time to time, the "Credit Agreement"), among the Borrower, the
Lenders, NationsBank, N.A., as Agent, and SunTrust Bank, Nashville, N.A., as
Co-Agent. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement. The Borrower
hereby gives notice pursuant to Section 2.1 of the Credit Agreement that it
requests a Revolving Loan advance under the Credit Agreement, and in connection
therewith sets forth below the terms on which such Loan advance is requested to
be made:
(A) Date of Borrowing
(which is a Business Day) _______________________
(B) Principal Amount of
Borrowing _______________________
(C) Interest rate basis _______________________
(D) Interest Period and the
last day thereof _______________________
In accordance with the requirements of Section 4.2, the Borrower hereby
reaffirms the representations and warranties set forth in the Credit Agreement
as provided in subsection (b) of such Section, and confirms that the matters
referenced in subsections (c), (d) and (e) of such Section, are true and
correct.
Very truly yours,
AUTOZONE, INC.
By:
Name:
Title:
- 1-
56
Schedule 2.1(e)
FORM OF REVOLVING NOTE
$_________________ December 20, 1996
FOR VALUE RECEIVED, AUTOZONE, INC., a Nevada corporation (the "Borrower"),
hereby promises to pay to the order of __________________________, its
successors and assigns (the "Lender"), at the office of NationsBank, N.A., as
Agent (the "Agent"), at 101 N. Tryon Street, Independence Center,
NC1-001-15-04, Charlotte, North Carolina 28255 (or at such other place or
places as the holder hereof may designate), at the times set forth in the
Credit Agreement, dated as of December 20, 1996, among the Borrower, the
Lenders, the Agent and the Co-Agent (as it may be amended, modified, extended
or restated from time to time, the "Credit Agreement"; all capitalized terms
not otherwise defined herein shall have the meanings set forth in the Credit
Agreement), but in no event later than the Termination Date, in Dollars and in
immediately available funds, the principal amount of
_____________________DOLLARS ($____________) or, if less than such principal
amount, the aggregate unpaid principal amount of all Revolving Loans made by
the Lender to the Borrower pursuant to the Credit Agreement, and to pay
interest from the date hereof on the unpaid principal amount hereof, in like
money, at said office, on the dates and at the rates selected in accordance
with Section 2.1(d) of the Credit Agreement.
Upon the occurrence and during the continuance of an Event of Default, the
balance outstanding hereunder shall bear interest as provided in Section 3.1 of
the Credit Agreement. Further, in the event the payment of all sums due
hereunder is accelerated under the terms of the Credit Agreement, this Note,
and all other indebtedness of the Borrower to the Lender shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which are hereby waived by the Borrower.
In the event this Note is not paid when due at any stated or accelerated
maturity, the Borrower agrees to pay, in addition to the principal and
interest, all costs of collection, including reasonable attorneys' fees.
All borrowings evidenced by this Note and all payments and prepayments of
the principal hereof and interest hereon and the respective dates thereof shall
be endorsed by the holder hereof on Schedule A attached hereto and incorporated
herein by reference, or on a continuation thereof which shall be attached
hereto and made a part hereof; provided, however, that any failure to endorse
such information on such schedule or continuation thereof shall not in any
manner affect the obligation of the Borrower to make payments of principal and
interest in accordance with the terms of this Note.
This Note and the Loans evidenced hereby may be transferred in whole or in
part only by registration of such transfer on the Register maintained by or on
behalf of the Borrower as provided in Section 10.3(c) of the Credit Agreement.
IN WITNESS WHEREOF, the Borrower has caused this Note to be duly executed
by its duly authorized officer as of the day and year first above written.
AUTOZONE, INC.
By:
Name:
Title:
By:
Name:
Title:
-1-
57
SCHEDULE A TO THE
REVOLVING NOTE
OF AUTOZONE, INC.
DATED DECEMBER 20, 1996
Unpaid Name of
Type Principal Person
of Interest Payments Balance Making
Date Loan Period Principal Interest of Note Notation
- ---- ---- -------- --------- -------- ------- --------
-2-
58
SCHEDULE 2.2(F)
FORM OF COMPETITIVE NOTE
$275,000,000.00 December 20, 1996
FOR VALUE RECEIVED, AUTOZONE, INC., a Nevada corporation (the "Borrower"),
hereby promises to pay to the order of __________________________, its
successors and permitted assigns (the "Lender"), at the office of NationsBank,
N.A., as Agent (the "Agent"), at 101 N. Tryon Street, Independence Center,
NC1-001-15-04, Charlotte, North Carolina 28255 (or at such other place or
places as the holder hereof may designate), at the times set forth in the
Credit Agreement, dated as of December 20, 1996, among the Borrower, the
Lenders, the Agent and the Co-Agent (as it may be amended, modified, extended
or restated from time to time, the "Credit Agreement"; all capitalized terms
not otherwise defined herein shall have the meanings set forth in the Credit
Agreement), but in no event later than the Termination Date, in Dollars and in
immediately available funds, the principal amount of TWO HUNDRED SEVENTY-FIVE
MILLION DOLLARS ($275,000,000.00) or, if less than such principal amount, the
aggregate unpaid principal amount of all Competitive Loans made by the Lender
to the Borrower pursuant to the Credit Agreement, and to pay interest from the
date hereof on the unpaid principal amount hereof, in like money, at said
office, on the dates and at the rates selected in accordance with Section 2.2
of the Credit Agreement and in the respective Competitive Bid applicable to
each Competitive Loan borrowing evidenced hereby.
Upon the occurrence and during the continuance of an Event of Default, the
balance outstanding hereunder shall bear interest as provided in Section 3.1 of
the Credit Agreement. Further, in the event the payment of all sums due
hereunder is accelerated under the terms of the Credit Agreement, this Note,
and all other indebtedness of the Borrower to the Lender shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which are hereby waived by the Borrower.
In the event this Note is not paid when due at any stated or accelerated
maturity, the Borrower agrees to pay, in addition to the principal and
interest, all costs of collection, including reasonable attorneys' fees.
All borrowings evidenced by this Note and all payments and prepayments of
the principal hereof and interest hereon and the respective dates thereof shall
be endorsed by the holder hereof on Schedule A attached hereto and incorporated
herein by reference, or on a continuation thereof which shall be attached
hereto and made a part hereof; provided, however, that any failure to endorse
such information on such schedule or continuation thereof shall not in any
manner affect the obligation of the Borrower to make payments of principal and
interest in accordance with the terms of this Note.
This Note and the Loans evidenced hereby may be transferred in whole or in
part only by registration of such transfer on the Register maintained by or on
behalf of the Borrower as provided in Section 10.3(c) of the Credit Agreement.
IN WITNESS WHEREOF, the Borrower has caused this Note to be duly executed
by its duly authorized officer as of the day and year first above written.
AUTOZONE, INC.
By:
Name:
Title:
By:
Name:
Title:
-1-
59
SCHEDULE A TO THE
COMPETITIVE NOTE
OF AUTOZONE, INC.
DATED DECEMBER 20, 1996
Unpaid Name of
Type PrincipalPerson
of Interest Payments Balance Making
Date Loan Period Principal Interest of Note Notation
---- ---- -------- --------- -------- ------- ---------
-2-
60
SCHEDULE 2.3(D)
FORM OF SWINGLINE NOTE
$__________________ December 20, 1996
FOR VALUE RECEIVED, AUTOZONE, INC., a Nevada corporation (the "Borrower"),
hereby promises to pay to the order of NATIONSBANK, N.A., its successors and
assigns (the "Swingline Lender"), at the office of NationsBank, N.A., as Agent
(the "Agent"), at 101 N. Tryon Street, Independence Center, NC1-001-15-04,
Charlotte, North Carolina 28255 (or at such other place or places as the
holder hereof may designate), at the times set forth in the Credit Agreement,
dated as of December 20, 1996, among the Borrower, the Swingline Lender and
other Lenders, the Agent and the Co-Agent (as it may be amended, modified,
extended or restated from time to time, the "Credit Agreement"; all capitalized
terms not otherwise defined herein shall have the meanings set forth in the
Credit Agreement), but in no event later than the Termination Date, in Dollars
and in immediately available funds, the principal amount of _______________
DOLLARS ($________________) or, if less than such principal amount, the
aggregate unpaid principal amount of all Swingline Loans made by the Swingline
Lender to the Borrower pursuant to the Credit Agreement, and to pay interest
from the date hereof on the unpaid principal amount hereof, in like money, at
said office, on the dates and at the rates selected in accordance with Section
2.3(c) of the Credit Agreement.
Upon the occurrence and during the continuance of an Event of Default, the
balance outstanding hereunder shall bear interest as provided in Section 3.1 of
the Credit Agreement. Further, in the event the payment of all sums due
hereunder is accelerated under the terms of the Credit Agreement, this Note,
and all other indebtedness of the Borrower to the Swingline Lender shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which are hereby waived by the Borrower.
In the event this Note is not paid when due at any stated or accelerated
maturity, the Borrower agrees to pay, in addition to the principal and
interest, all costs of collection, including reasonable attorneys' fees.
All borrowings evidenced by this Note and all payments and prepayments of
the principal hereof and interest hereon and the respective dates thereof shall
be endorsed by the holder hereof on Schedule A attached hereto and incorporated
herein by reference, or on a continuation thereof which shall be attached
hereto and made a part hereof; provided, however, that any failure to endorse
such information on such schedule or continuation thereof shall not in any
manner affect the obligation of the Borrower to make payments of principal and
interest in accordance with the terms of this Note.
This Note and the Loans evidenced hereby may be transferred in whole or in
part only by registration of such transfer on the Register maintained by or on
behalf of the Borrower as provided in Section 10.3(c) of the Credit Agreement.
IN WITNESS WHEREOF, the Borrower has caused this Note to be duly executed
by its duly authorized officer as of the day and year first above written.
AUTOZONE, INC.
By:
Name:
Title:
By:
Name:
Title:
-1-
61
SCHEDULE A TO THE
SWINGLINE NOTE
OF AUTOZONE, INC.
DATED DECEMBER 20, 1996
Unpaid Name of
Type PrincipalPerson
of Interest Payments Balance Making
Date Loan Period Principal Interest of Note Notation
- ---- ---- -------- --------- -------- ------- -------------------
-2-
62
SCHEDULE 3.2
FORM OF NOTICE OF EXTENSION/CONVERSION
NationsBank, N.A.,
as Agent for the Lenders
101 N. Tryon Street
Independence Center, 15th Floor
NC1-001-15-04
Charlotte, North Carolina 28255
Attention: Agency Services
Ladies and Gentlemen:
The undersigned, AutoZone, Inc. (the "Borrower"), refers to the Credit
Agreement dated as of December 20, 1996 (as amended, modified, extended or
restated from time to time, the "Credit Agreement"), among the Borrower, the
Lenders, NationsBank, N.A., as Agent, and SunTrust Bank, Nashville, N.A., as
Co-Agent. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement. The Borrower
hereby gives notice pursuant to Section 3.2 of the Credit Agreement that it
requests an extension or conversion of a Revolving Loan outstanding under the
Credit Agreement, and in connection therewith sets forth below the terms on
which such extension or conversion is requested to be made:
(A) Date of Extension or Conversion
(which is the last day of the
the applicable Interest Period) _______________________
(B) Principal Amount of
Extension or Conversion _______________________
(C) Interest rate basis _______________________
(D) Interest Period and the
last day thereof _______________________
In accordance with the requirements of Section 4.2, the Borrower hereby
reaffirms the representations and warranties set forth in the Credit Agreement
as provided in subsection (b) of such Section, and confirms that the matters
referenced in subsections (c), (d) and (e) of such Section, are true and
correct.
Very truly yours,
AUTOZONE, INC.
By:
Name:
Title:
-1-
63
SCHEDULE 3.4(B)
FORM OF
NEW COMMITMENT AGREEMENT
Reference is made to the Credit Agreement dated as of December 20, 1996,
as amended and modified from time to time thereafter (the "Credit Agreement")
among AutoZone, Inc., the Lenders party thereto, NationsBank, N.A., as Agent,
and SunTrust Bank, Nashville, N.A., as Co-Agent. Terms defined in the Credit
Agreement are used herein with the same meanings.
1. The undersigned Lender hereby confirms its Commitment, effective as of
the Effective Date set forth below, to make Loans under the Credit Agreement up
to the principal amount of such Commitment as set forth below. If the
undersigned Lender is already a Lender under the Credit Agreement, such Lender
acknowledges and agrees that such Commitment is in addition to any existing
Commitment of such Lender under the Credit Agreement. If the undersigned
Lender is not already a Lender under the Credit Agreement, such Lender hereby
acknowledges, agrees and confirms that, by its execution of this New Commitment
Agreement, such Lender will, as of the Effective Date, be a party to the Credit
Agreement and be bound by the provisions of the Credit Agreement and, to the
extent of its Commitment, have the rights and obligations of a Lender
thereunder.
2. This New Commitment Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina.
3. This New Commitment Agreement may be executed in any number of
counterparts, each of which where so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this New Commitment Agreement to
produce or account for more than one such counterpart.
Amount of Revolving Commitment $____________________
Effective Date of Revolving Commitment _____________________, 19___
The terms set forth above
are hereby agreed to:
[Lender]
By:
Name:
Title:
CONSENTED TO:
NATIONSBANK, N.A., AUTOZONE, INC.
as Agent
By: By:
Title: Title:
Name: Name:
-1-
64
SCHEDULE 4.1(F)
[AUTOZONE LOGO]
HARRY L. GOLDSMITH
Vice President and General Counsel
Customer Satisfaction
December 20, 1996
To the Addresses Listed on Schedule A Attached
Re: AutoZone, Inc. Credit Loan Agreement
Ladies and Gentlemen:
I am the Senior Vice President, Secretary, and General Counsel of
AutoZone, Inc., a Nevada corporation ("AutoZone"), and am familiar with the
transactions contemplated by the Credit Agreement Dated as of December 20, 1996
among AutoZone, Inc., as Borrower, The Several Lenders From Time To Time Party
Hereto And NationsBank, N.A., as Agent and Suntrust Bank, Nashville, N.A., as
Co-Agent ("Credit Agreement"). Unless the context otherwise requires, all
terms used in this opinion which are specifically defined in a Credit Agreement
shall the meanings given such terms in the Credit Agreement.
In connection with the opinions expressed below, I have examined, or
caused to be examined, the Credit Documents. I have relied upon the
representations and warranties contained in each of such documents and upon
originals or copies, certified or otherwise identified to my satisfaction, of
such corporate records, documents and other instruments as in my judgment are
relevant to rendering the opinions expressed below. As to all matters of fact
covered by such documents, I have relied, without independent investigation or
verification on such documents. In such examination, I have assumed that each
of the parties to the Credit Agreement, other than AutoZone, had and has, as
the case may be, full power, authority and legal right to enter into each
Credit Document to which it is a party and that each such Credit Document was
or has been, as the case may be, duly authorized, executed and delivered by
each of such parties.
Based on the foregoing, it is my opinion that:
(i) Each of the Company and its subsidiaries has been duly organized and
is validly existing as a corporation or limited partnership under the
laws of the jurisdiction of its organization, with corporate or
partnership, as the case may be, power and authority to own its
properties and conduct its ordinary course of business;
(ii) Each of the Company and its subsidiaries has been duly qualified as
a foreign corporation or limited partnership, as the case may be, for the
transaction of business and is in good standing under the laws of each
jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, or is subject to no
material liability or disability by reason of failure to be so qualified
in any such jurisdiction;
AutoZone, Inc., 123 So. Front St. 38103-3607, P.O. Box 2198, Memphis, TN
38101-9842 (901) 495-7966
-1-
65
December 20, 1996
pg. 2
(iii) Each of the Credit Documents to which AutoZone is a party, was or
has been, as the case may be, duly authorized, executed and delivered by
AutoZone and together constitute the legal, valid and binding obligations
of AutoZone enforceable against AutoZone in accordance with its and their
terms.
The opinions expressed in Paragraph (iii) above are based upon the
assumption for purposes of such opinions and without independent analysis that
notwithstanding the respective choice of law clauses in the Credit Documents,
the governing law with respect to each of the Credit Documents is identical in
all relevant respects to the law of the State of Tennessee. Insofar as such
opinion relates to the enforceability of any instrument, such enforceability is
subject to applicable bankruptcy, insolvency and other similar laws affecting
the enforcement of creditors' rights generally (whether such enforceability is
considered in a proceeding in equity or at law). The enforceability of the
remedies provided under the Credit Agreement may also be limited by applicable
laws which may affect the remedies provided therein but which do not in my
opinion affect the validity of the Credit Agreement or make such remedies
inadequate for the practical realization of the benefits intended to be
provided.
I do not express any opinion as to matters governed by any law other than
the Federal laws of the United States of America, the corporation law of the
State of Nevada and the laws of the State of Tennessee. Further, I express no
opinion as to the enforceability of the choice of law provisions contained in
any of the Credit Documents.
This opinion is rendered solely for your benefit in connection with the
transactions described above. This opinion may not be used or relied upon by
any other person, and may not be disclosed, quoted, filed with a governmental
agency or otherwise referred to without my prior written consent except to your
bank examiners, auditors and counsel and to prospective transferees of your
interests under the Credit Documents and their professional advisers, or as
required by law or pursuant to legal process.
Very truly yours,
Harry L. Goldsmith
-2-
66
SCHEDULE A
Bank of America Illinois
950 East Paces Ferry
Suite 3375
Atlanta, GA 30326
The First National Bank of Chicago
One First National Plaza
Mail Suite 0324
Chicago, IL 60670
First Tennessee Bank National Association
165 Madison Avenue
Memphis, TN 38103
First Union National Bank of Tennessee
150 4th Avenue North
2nd Floor
Nashville, TN 37219
NationsBank, N.A.
NationsBank Corporate Center
NC1007-8-7
Charlotte, N. C. 28255
NationsBank of Tennessee
One NationsBank Plaza
Nashville, TN 37219
SunTrust Bank, Nashville, N. A.
6410 Poplar Avenue
Suite 320
Memphis, TN 38119
Union Planters National Bank
6200 Poplar Avenue
4th Floor
Memphis, TN 38147
United States National Bank of Oregon
555 S. W. Oak Street
Suite 400
Portland, OR 97204
-3-
67
SCHEDULE 4.1(G)
FORM OF LEGAL OPINION
MOORE & VAN ALLEN, PLLC
ATTORNEYS AT LAW
NATIONSBANK CORPORATE CENTER TELEPHONE 704-331-1000
100 NORTH TRYON STREET FLOOR 47 FACSIMILE 704-331-1159
CHARLOTTE, NORTH CAROLINA 282-4003
December 20, 1996
To the Lenders party to the Credit
Agreement referred to below,
NationsBank, N.A., as Agent
therunder, and SunTrust Bank,
Nashville, N.A., as Co-Agent thereunder
Ladies and Gentlemen:
We have acted as special North Carolina counsel to the Lenders in
connection with the Credit Agreement, dated as of December 20, 1996 (the
"Credit Agreement"), by and among AutoZone, Inc., a Nevada corporation (the
"Borrower"), the lenders party thereto (the "Lenders"), NationsBank, N.A., as
Agent, and SunTrust Bank, Nashville, N.A., as Co-Agent. Capitalized terms used
but not otherwise defined shall have the meanings ascribed to such terms in the
Credit Agreement.
In rendering the opinions expressed below, we have examined the following
documents (collectively, the "Credit Documents"):
(a) the Credit Agreement; and
(b) the Notes.
The opinions contained herein are based solely on our review of copies of
the Credit Documents. We understand that you are relying on the legal opinion
of Harry L. Goldsmith, Esq. and are not relying upon our opinion regarding,
among other things, the due organization and good standing of the Borrower and
its power and authority to enter into the Credit Documents, and the due
authorization, execution and delivery of the Credit Documents by the Borrower.
In rendering the opinions hereinafter set forth, we have assumed (i) the
due authorization, execution and delivery of the Credit Documents by all the
parties thereto, (ii) the authenticity of all documents submitted to us as
originals, (iii) the conformity to the originals thereof of all documents
submitted to us as copies, (iv) that the Borrower is validly existing and in
good standing under the laws of Nevada, (v) that the Borrower has the corporate
power to execute and deliver the Credit Documents to which it is party and to
perform its obligations thereunder, and (vi) that if the Agent, the Co-Agent
and/or the Lenders seek to enforce their rights under the Credit Documents such
enforcement shall only by under circumstances which are consistent with
applicable law and the provisions of the Credit Documents and are equitable and
commercially reasonable.
-1-
68
December 20, 1996
Page 2
Based upon the foregoing assumptions and subject to the qualifications
hereinafter set forth, we are of the opinion that:
1. The Credit Documents are legal, valid and binding obligations of the
Borrower, enforceable against it in accordance with their terms, except to the
extent that enforceability may be limited by (i) applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium, or similar laws
now or hereafter in effect relating to or affecting creditors' rights or the
collection of debtors' obligations generally, (ii) general principles of
equity, the application of which may deny the Lenders, the Agent and the
Co-Agent certain of the rights and remedies granted them under the Credit
Documents, including without limitation rights to specific performance,
injunctive relief and the appointment of a receiver, and (iii) general
principles of commercial reasonableness and good faith to the extent required
of the Lenders, the Agent and the Co-Agent by applicable law.
Our opinion is also subject to the following further exceptions:
(a) We call to your attention that collection of attorneys' fees in
actions to collect on or enforce the Notes will be subject to compliance
with the provisions of N.C. Gen. Stat. Section 6-21.2. The collection of
"reasonable attorneys' fees" is construed to mean, and is limited in any
event, to 15% of the outstanding balance owing on the note or other
evidence of indebtedness under N.C. Gen. Stat. Section 6-21.2.
(b) We express no opinion whatsoever as to the validity or
enforceability of the waiver of jury trial. We call your attention to
the provisions of N.C. Gen. Stat. Section 22B-10 which provide that such
waiver of jury trial provisions are against public policy and, as a
consequence, unenforceable.
(c) The Credit Documents contain provisions to the effect that the
acceptance by the Lender of a past due installment or other performance
by borrowers shall not be deemed a waiver of its right to accelerate the
loan. The North Carolina Court of Appeals has held that when the holder
of a promissory note regularly accepts late payments, it is deemed to
have waived its right to accelerate the debt because of late payments
until it notifies the maker that prompt payments are again required.
Driftwood Manor Investors v. City Federal Savings & Loan Association, 63
N.C. App. 459, 305 S.E.2d 204 (1983). Therefore, we are unable to opine
that the above-described provisions would be enforceable under all
circumstances.
(d) Pursuant to the Credit Documents, the Lenders reserve the right
to charge "default interest" or a higher rate of interest after default
than the interest which would otherwise accrue under the Loans. Although
we have discovered no applicable legal authority directly on point,
penalties and forfeitures are generally not favored under the law and,
accordingly, the issue concerning the Lenders' ability to collect
"default interest" or any such similar charge which might be imposed
under the Loans is unclear, and may be unenforceable.
-2-
69
December 20, 1996
Page 3
(e) The provisions of the Credit Documents by which the terms may be
modified or waived only in writing may be unenforceable and without
effect in North Carolina. A North Carolina court has held that
provisions of a written contract may be modified or waived by a
subsequent parol agreement or by conduct even though the contract
provides that only written modifications shall be binding. Son-Shine
Grading, Inc. v. ADC Construction Co., 68 N.C.App. 417, 315 S.E.2d 346,
review denied, 312 N.C. 85, 321 S.E.2d 900 (1984).
(f) Our opinion set forth above is subject to the qualification that
certain other provisions of the Credit Documents are or may be
unenforceable in whole or in part under the laws of the State of North
Carolina, but the inclusion of such provisions does not affect the
validity of the Credit Documents and the Credit Documents contain
adequate provisions for enforcing payment of the obligations described
therein and for the practical realization of the rights and benefits
afforded thereby.
(g) To the extent that any of the Credit Documents impose any
obligations upon the Lenders, the Agent or the Co-Agent, we have assumed
that such Credit Documents are valid and binding obligations against such
Lenders, Agent or Co-Agent, as the case may be, enforceable against such
Lenders, Agent or Co-Agent in accordance with their respective terms.
Members of our firm are admitted to the Bar of the State of North Carolina
and we express no opinion as to the laws of any jurisdiction other than the
State of North Carolina, including the federal laws of the United States.
This opinion is rendered solely for your benefit in connection with the
transactions described above. This opinion may not be used or relied upon by
any other person, and may not be disclosed, quoted, filed with a governmental
agency or otherwise referred to without our prior written consent except to
your bank examiners, auditors and counsel and to prospective transferees of
your interests under the Credit Documents and their professional advisors, or
as required by law or pursuant to legal process.
Very truly yours,
MOORE & VAN ALLEN, PLLC
-3-
70
SCHEDULE 5.12
[Diagram showing subsidiaries of AutoZone]
AutoZone, Inc.
AutoZone Stores, Inc.
AutoZone Properties, Inc.
AutoZone Development Corporation
AutoZone Marketing Company
AutoZoners, Inc.
Alldata Corporation
AutoZone Texas, L.P.
-1-
71
SCHEDULE 6.1(C)
FORM OF OFFICER'S COMPLIANCE CERTIFICATE
For the fiscal quarter ended _________________, 19___.
I, ______________________, [Title] of AutoZone, Inc. (the "Borrower")
hereby certify that, to the best of my knowledge and belief, with respect to
that certain Credit Agreement dated as of December 20, 1996 (as amended,
modified, extended or restated from time to time, the "Credit Agreement"; all
of the defined terms in the Credit Agreement are incorporated herein by
reference) among the Borrower, the Lenders party thereto, NationsBank, N.A., as
Agent, and SunTrust Bank, Nashville, N.A., as Co-Agent:
a. The company-prepared financial statements which accompany this
certificate are true and correct in all material respects and have
been prepared in accordance with GAAP applied on a consistent basis,
subject to changes resulting from normal year-end audit adjustments.
b. Since ___________ (the date of the last similar certification, or,
if none, the Closing Date) no Default or Event of Default has
occurred under the Credit Agreement; and
Delivered herewith are detailed calculations demonstrating compliance by the
Borrower with the financial covenant contained in Section 6.10 of the Credit
Agreement as of the end of the fiscal period referred to above.
This ______ day of ___________, 19__.
AUTOZONE, INC.
By:
Name:
Title:
ATTACHMENT TO OFFICER'S CERTIFICATE
COMPUTATION OF FINANCIAL COVENANTS
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SCHEDULE 10.3(B)
FORM OF ASSIGNMENT AND ACCEPTANCE
THIS ASSIGNMENT AND ACCEPTANCE dated as of _______________, 199_ is
entered into between ________________ ("Assignor") and ____________________
("Assignee").
Reference is made to the Credit Agreement dated as of December 20, 1996,
as amended and modified from time to time thereafter (the "Credit Agreement")
among AutoZone, Inc., the Lenders party thereto, NationsBank, N.A., as Agent,
and SunTrust Bank, Nashville, N.A., as Co-Agent. Terms defined in the Credit
Agreement are used herein with the same meanings.
1. The Assignor hereby sells and assigns, without recourse, to the
Assignee, and the Assignee hereby purchases and assumes from the Assignor,
effective as of the Effective Date set forth below, the interests set forth
below (the "Assigned Interest") in the Assignor's rights and obligations under
the Credit Agreement, including, without limitation, the interests set forth
below in the Commitments and outstanding Loans of the Assignor on the effective
date of the assignment designated below (the "Effective Date"), together with
unpaid Fees accrued on the assigned Commitments to the Effective Date and
unpaid interest accrued on the assigned Loans to the Effective Date. Each of
the Assignor and the Assignee hereby makes and agrees to be bound by all the
representations, warranties and agreements set forth in Section 10.3(b) of the
Credit Agreement, a copy of which has been received by the Assignee. From and
after the Effective Date (i) the Assignee, if it is not already a Lender under
the Credit Agreement, shall be a party to and be bound by the provisions of the
Credit Agreement and, to the extent of the interests purchased and assumed by
the Assignee under this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent
of the interests sold and assigned by the Assignor under this Assignment and
Acceptance, relinquish its rights and be released from its obligations under
the Credit Agreement.
2. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of North Carolina.
3. Terms of Assignment
(a) Date of Assignment:
(b) Legal Name of Assignor:
(c) Legal Name of Assignee:
(d) Effective Date of Assignment:
(e) Revolving Commitment of Assignee
after giving effect to this
Assignment and Acceptance as
of the Effective Date $_________________
(f) Revolving Commitment of Assignor
after giving effect to this
Assignment and Acceptance as
of the Effective Date $_________________
(g) Commitment Percentage of Assignee
after giving effect to this
Assignment and Acceptance
as of the Effective Date
(set forth to at least 8 decimals) %
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73
(h) Commitment Percentage of Assignor
after giving effect to this
Assignment and Acceptance
as of the Effective Date
(set forth to at least 8 decimals) %
4. This Assignment and Acceptance shall be effective only upon consent of
the Borrower and the Agent, if applicable, delivery to the Agent of this
Assignment and Acceptance together with the transfer fee payable pursuant to
Section 10.3(b) in connection herewith and recordation in the Register pursuant
to Section 10.3(c) of the terms hereof.
5. This Assignment and Acceptance may be executed in any number of
counterparts, each of which where so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Assignment and Acceptance to
produce or account for more than one such counterpart.
The terms set forth above
are hereby agreed to:
____________________, as Assignor
By:
Name:
Title:
_____________________, as Assignee
By:
Name:
Title:
Notice address of Assignee:
<>
__________________________
__________________________
Attn:_____________________
Telephone: (___) ________
Telecopy: (___) ________
CONSENTED TO:
NATIONSBANK, N.A., AUTOZONE, INC.
as Agent
By: By:
Name: Name:
Title: Title:
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