Document/Exhibit Description Pages Size
1: 10-K Delta Air Lines, Inc. 27 111K
2: EX-4.7 Credit Agreement 91 331K
4: EX-10.16 Forms of Executive Retention Protection Agreements 45 153K
3: EX-10.8 Agreement Between Delta and Ronald W. Allen 63 241K
5: EX-11 Statement Re: Computation of Per Share Earnings 2± 13K
6: EX-12 Statement Re: Computation of Ratios 1 10K
7: EX-13 Portions of Delta's 1997 Annual Report 54± 243K
8: EX-18 Letter Re: Change in Accounting Principles 1 9K
9: EX-23 Consent of Arthur Andersen 1 7K
10: EX-24 Powers of Attorney 13 25K
11: EX-27 Financial Data Schedule 1 10K
| Page | (sequential) | | | | (alphabetic) | Top |
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| | |
- Alternative Formats (Word, et al.)
- Agent Bank
- Agent Bank, The
- Article 10. Yield Protection
- Article 11. the Agent Bank
- Article 12. Miscellaneous
- Article 1. Definitions
- Article 2. Amount and Terms of Credit
- Article 3. the Loans
- Article 4. Letter of Credit Facility
- Article 5. Conditions to Effectiveness of Agreement, for Borrowings and Issuance of Letters of Credit
- Article 6. Representations and Warranties
- Article 7. Affirmative Covenants
- Article 8. Negative Covenants
- Article 9. Defaults
- Company, The
- Credit Agreement
- Guaranty Liabilities
- Section 10.1. Increased Cost of Eurodollar Rate Loans
- Section 10.2. Change of Law
- Section 10.4. Increased Cost of Maintaining Letters of Credit
- Section 10.5. Mandatory Repayment or Conversion on Certain Events
- Section 10.6. Survival
- Section 11.1. Authorization and Action
- Section 11.2. Agent Bank's Reliance, Etc
- Section 11.3. Agent Bank and Affiliates
- Section 11.5. Events of Default
- Section 11.6. Right to Indemnity
- Section 11.8. Successor Agent Bank
- Section 12.10. Execution and Effective Date
- Section 12.11. Representation of Banks
- Section 12.12. Severability
- Section 12.1. Rights and Remedies
- Section 12.2. Notices
- Section 12.3. Expenses, Indemnification, Etc
- Section 12.5. Agreement as to Right of Set-off, Sharing of Losses
- Section 12.6. Successors and Assigns
- Section 12.7. Holidays
- Section 12.8. Law Governing
- Section 2.1. Commitment
- Section 2.2. The Banks
- Section 3.10. Failure to Borrow
- Section 3.12. Termination of Credit Facility
- Section 3.13. Optional Reduction of Commitments
- Section 3.14. Substitution of Banks
- Section 3.16. Mandatory Termination of Commitments Upon Change in Control
- Section 3.17. Agent Fees
- Section 3.18. Extension of Term of Credit Facility
- Section 3.1. Syndicated Loans
- Section 3.2. Notice and Place of Borrowing for Syndicated Loans
- Section 3.3. Competitive Bid Loans
- Section 3.4. The Notes
- Section 3.6. Place of Payment
- Section 3.7. Voluntary Prepayment
- Section 3.8. Pro Rata Treatment
- Section 3.9. Initial Determination of Interest Rate and Conversion of Loans Between Eurodollar Rate and Base Rate
- Section 4.1. Letters of Credit
- Section 4.2. Method of Issuance of Letters of Credit
- Section 4.3. Letter of Credit Fees
- Section 4.4. Letter of Credit Reimbursement
- Section 4.5. Letter of Credit Banks
- Section 5.1. Effectiveness, Initial Borrowing and Issuance of Letters of Credit
- Section 5.2. All Borrowings
- Section 6.10. Use of Proceeds
- Section 6.11. Governmental Regulation
- Section 6.12. Subsidiaries
- Section 6.13. ERISA
- Section 6.14. Environmental Matters
- Section 6.1. Organization; Standing, Etc
- Section 6.2. Financial Statements
- Section 6.3. Litigation
- Section 6.4. Business; Status as Air Carrier
- Section 6.5. Funded Debt
- Section 6.6. Title to Properties, Etc
- Section 6.7. Tax Returns and Payments
- Section 6.8. Compliance With Other Instruments
- Section 6.9. Offering of Notes
- Section 7.1. Insurance
- Section 7.2. Payment of Taxes
- Section 7.3. Financial Statements
- Section 7.5. Inspection
- Section 7.6. Security for Notes
- Section 7.7. Notice of Any Default or Event of Default
- Section 7.8. ERISA Reporting Requirements
- Section 8.2. Debt
- Section 8.4. Leases
- Section 9.1. Events of Default
- The Agent Bank
- The Company
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| 1 | 1st Page - Filing Submission
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| " | Credit Agreement
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| 6 | Article 1. Definitions
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| 13 | Article 2. Amount and Terms of Credit
|
| " | Section 2.1. Commitment
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| 14 | Section 2.2. The Banks
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| " | Agent Bank
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| 17 | Article 3. the Loans
|
| " | Section 3.1. Syndicated Loans
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| " | Section 3.2. Notice and Place of Borrowing for Syndicated Loans
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| 18 | Section 3.3. Competitive Bid Loans
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| 21 | Section 3.4. The Notes
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| 23 | Section 3.6. Place of Payment
|
| " | Section 3.7. Voluntary Prepayment
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| " | Section 3.8. Pro Rata Treatment
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| 24 | Section 3.9. Initial Determination of Interest Rate and Conversion of Loans Between Eurodollar Rate and Base Rate
|
| " | Section 3.10. Failure to Borrow
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| 26 | Section 3.12. Termination of Credit Facility
|
| " | Section 3.13. Optional Reduction of Commitments
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| 27 | Section 3.14. Substitution of Banks
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| 30 | Section 3.16. Mandatory Termination of Commitments Upon Change in Control
|
| " | Section 3.17. Agent Fees
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| " | Section 3.18. Extension of Term of Credit Facility
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| 31 | Article 4. Letter of Credit Facility
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| " | Section 4.1. Letters of Credit
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| 33 | Section 4.2. Method of Issuance of Letters of Credit
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| " | Section 4.3. Letter of Credit Fees
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| 34 | Section 4.4. Letter of Credit Reimbursement
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| 36 | Section 4.5. Letter of Credit Banks
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| 37 | Article 5. Conditions to Effectiveness of Agreement, for Borrowings and Issuance of Letters of Credit
|
| " | Section 5.1. Effectiveness, Initial Borrowing and Issuance of Letters of Credit
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| 39 | Section 5.2. All Borrowings
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| 40 | Article 6. Representations and Warranties
|
| " | Section 6.1. Organization; Standing, Etc
|
| " | Section 6.2. Financial Statements
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| " | Section 6.3. Litigation
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| " | Section 6.4. Business; Status as Air Carrier
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| 41 | Section 6.5. Funded Debt
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| " | Section 6.6. Title to Properties, Etc
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| " | Section 6.7. Tax Returns and Payments
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| " | Section 6.8. Compliance With Other Instruments
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| 42 | Section 6.9. Offering of Notes
|
| " | Section 6.10. Use of Proceeds
|
| " | Section 6.11. Governmental Regulation
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| " | Section 6.12. Subsidiaries
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| " | Section 6.13. ERISA
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| 43 | Section 6.14. Environmental Matters
|
| " | Article 7. Affirmative Covenants
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| " | Section 7.1. Insurance
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| " | Section 7.2. Payment of Taxes
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| 44 | Section 7.3. Financial Statements
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| 45 | Section 7.5. Inspection
|
| " | Section 7.6. Security for Notes
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| " | Section 7.7. Notice of Any Default or Event of Default
|
| " | Section 7.8. ERISA Reporting Requirements
|
| " | Article 8. Negative Covenants
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| 46 | Section 8.2. Debt
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| 47 | Section 8.4. Leases
|
| " | Article 9. Defaults
|
| " | Section 9.1. Events of Default
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| 50 | Article 10. Yield Protection
|
| " | Section 10.1. Increased Cost of Eurodollar Rate Loans
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| 51 | Section 10.2. Change of Law
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| 52 | Section 10.4. Increased Cost of Maintaining Letters of Credit
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| 53 | Section 10.5. Mandatory Repayment or Conversion on Certain Events
|
| " | Section 10.6. Survival
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| " | Article 11. the Agent Bank
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| " | Section 11.1. Authorization and Action
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| 54 | Section 11.2. Agent Bank's Reliance, Etc
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| " | Section 11.3. Agent Bank and Affiliates
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| 55 | Section 11.5. Events of Default
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| " | Section 11.6. Right to Indemnity
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| 56 | Section 11.8. Successor Agent Bank
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| 57 | Article 12. Miscellaneous
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| " | Section 12.1. Rights and Remedies
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| " | Section 12.2. Notices
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| 58 | Section 12.3. Expenses, Indemnification, Etc
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| 60 | Section 12.5. Agreement as to Right of Set-off, Sharing of Losses
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| 61 | Section 12.6. Successors and Assigns
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| " | Section 12.7. Holidays
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| " | Section 12.8. Law Governing
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| 62 | Section 12.10. Execution and Effective Date
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| " | Section 12.11. Representation of Banks
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| " | Section 12.12. Severability
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| 64 | The Company
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| 83 | The Agent Bank
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| 91 | Guaranty Liabilities
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EXHIBIT 4.7
================================================================================
CREDIT AGREEMENT
DATED AS OF MAY 2, 1997
BY AND AMONG
DELTA AIR LINES, INC.,
EACH OF THE FINANCIAL INSTITUTIONS INITIALLY A SIGNATORY HERETO,
TOGETHER WITH THOSE ASSIGNEES PURSUANT TO SECTION 12.6 HEREOF
AND
NATIONSBANK, N.A. (SOUTH),
AS AGENT BANK
================================================================================
TABLE OF CONTENTS
[Download Table]
ARTICLE 1. DEFINITIONS.................................................... 1
Section 1.1. Definitions........................................... 1
ARTICLE 2. AMOUNT AND TERMS OF CREDIT..................................... 8
Section 2.1. Commitment............................................ 8
Section 2.2. The Banks............................................. 9
Section 2.3. Increases in the Total Commitments of the Banks....... 10
ARTICLE 3. THE LOANS...................................................... 12
Section 3.1. Syndicated Loans...................................... 12
Section 3.2. Notice and Place of Borrowing for Syndicated Loans.... 12
Section 3.3. Competitive Bid Loans................................. 13
Section 3.4. The Notes............................................. 16
Section 3.5. Interest.............................................. 17
Section 3.6. Place of Payment...................................... 18
Section 3.7. Voluntary Prepayment.................................. 18
Section 3.8. Pro Rata Treatment.................................... 18
Section 3.9. Initial Determination of Interest Rate and
Conversion of Loans Between Eurodollar Rate and Base Rate...... 19
Section 3.10. Failure to Borrow.................................... 19
Section 3.11. Commitment Fee....................................... 20
Section 3.12. Termination of Credit Facility....................... 21
Section 3.13. Optional Reduction of Commitments. .................. 21
Section 3.14. Substitution of Banks................................ 22
Section 3.15. Capital Requirements................................. 24
Section 3.16. Mandatory Termination of Commitments Upon
Change in Control.............................................. 25
Section 3.17. Agent Fees........................................... 25
Section 3.18. Extension of Term of Credit Facility................. 25
ARTICLE 4. LETTER OF CREDIT FACILITY...................................... 26
Section 4.1. Letters of Credit..................................... 26
Section 4.2. Method of Issuance of Letters of Credit............... 28
Section 4.3. Letter of Credit Fees................................. 28
Section 4.4. Letter of Credit Reimbursement........................ 29
Section 4.5. Letter of Credit Banks................................ 31
-i-
[Download Table]
ARTICLE 5. CONDITIONS TO EFFECTIVENESS OF AGREEMENT, FOR
BORROWINGS AND ISSUANCE OF LETTERS OF CREDIT........................ 32
Section 5.1. Effectiveness, Initial Borrowing and Issuance
of Letters of Credit........................................ 32
Section 5.2. All Borrowings........................................ 34
ARTICLE 6. REPRESENTATIONS AND WARRANTIES................................. 35
Section 6.1. Organization; Standing, Etc........................... 35
Section 6.2. Financial Statements.................................. 35
Section 6.3. Litigation............................................ 35
Section 6.4. Business; Status as Air Carrier....................... 35
Section 6.5. Funded Debt........................................... 36
Section 6.6. Title to Properties, Etc.............................. 36
Section 6.7. Tax Returns and Payments.............................. 36
Section 6.8. Compliance With Other Instruments..................... 36
Section 6.9. Offering of Notes..................................... 37
Section 6.10. Use of Proceeds...................................... 37
Section 6.11. Governmental Regulation.............................. 37
Section 6.12. Subsidiaries......................................... 37
Section 6.13. ERISA................................................ 37
Section 6.14. Environmental Matters................................ 38
ARTICLE 7. AFFIRMATIVE COVENANTS.......................................... 38
Section 7.1. Insurance............................................. 38
Section 7.2. Payment of Taxes...................................... 38
Section 7.3. Financial Statements.................................. 39
Section 7.4. Maintenance of Equipment.............................. 40
Section 7.5. Inspection............................................ 40
Section 7.6. Security for Notes.................................... 40
Section 7.7. Notice of Any Default or Event of Default............. 40
Section 7.8. ERISA Reporting Requirements.......................... 40
ARTICLE 8. NEGATIVE COVENANTS............................................. 40
Section 8.1. Liens................................................. 41
Section 8.2. Debt.................................................. 41
Section 8.3. Mergers; Disposition of Assets........................ 42
Section 8.4. Leases................................................ 42
ARTICLE 9. DEFAULTS....................................................... 42
Section 9.1. Events of Default..................................... 42
ARTICLE 10. YIELD PROTECTION.............................................. 45
Section 10.1. Increased Cost of Eurodollar Rate Loans.............. 45
Section 10.2. Change of Law........................................ 46
Section 10.3. Funding Losses....................................... 47
-ii-
[Download Table]
Section 10.4. Increased Cost of Maintaining Letters of Credit...... 47
Section 10.5. Mandatory Repayment or Conversion on Certain Events.. 48
Section 10.6. Survival............................................. 48
ARTICLE 11. THE AGENT BANK................................................ 48
Section 11.1. Authorization and Action............................... 48
Section 11.2. Agent Bank's Reliance, Etc............................. 49
Section 11.3. Agent Bank and Affiliates.............................. 49
Section 11.4. Representations of the Banks........................... 50
Section 11.5. Events of Default...................................... 50
Section 11.6. Right to Indemnity..................................... 50
Section 11.7. Indemnification........................................ 51
Section 11.8. Successor Agent Bank................................... 51
ARTICLE 12. MISCELLANEOUS.................................................. 52
Section 12.1. Rights and Remedies.................................... 52
Section 12.2. Notices................................................ 52
Section 12.3. Expenses, Indemnification, Etc......................... 53
Section 12.4. Amendments to this Agreement and the Notes............. 55
Section 12.5. Agreement as to Right of Set-off, Sharing of Losses.... 55
Section 12.6. Successors and Assigns................................. 56
Section 12.7. Holidays............................................... 56
Section 12.8. Law Governing.......................................... 56
Section 12.9. Disclosure to Other Persons............................ 57
Section 12.10. Execution and Effective Date.......................... 57
Section 12.11. Representation of Banks............................... 57
Section 12.12. Severability.......................................... 57
Section 12.13. Entire Agreement...................................... 58
Exhibit A-1 Form of Syndicated Note
Exhibit A-2 Form of Competitive Bid Note
Exhibit B Form of Notice of Increased Commitment
Exhibit C-1 Form of Notice and Agreement Regarding Addition of Bank
Exhibit C-2 Form of Agreement of Existing Bank to Replace Replaced Bank
Exhibit D Form of Assignment and Assumption Agreement
Exhibit E Form of Competitive Bid Quote Confirmation
Exhibit F Form of Acceptance of Competitive Bid Quotes
Exhibit G Form of Letter Acknowledging Termination of Existing Credit
Agreement
-iii-
Schedule I Funded Debt of the Company
Schedule II Subsidiaries of the Company
Schedule III Certain Excluded Guaranty Liabilities
-iv-
CREDIT AGREEMENT
THIS CREDIT AGREEMENT dated as of May 2, 1997 (this "Agreement") by and
among DELTA AIR LINES, INC., a corporation organized under the laws of the State
of Delaware (the "Company"), each of the financial institutions initially a
signatory hereto together with those assignees pursuant to Section 12.6. hereof
(collectively, the "Banks" and each individually, a "Bank") and NATIONSBANK, N.
A. (SOUTH), in its capacity as agent for the Banks (the "Agent Bank").
WHEREAS, the parties hereto desire to make available to the Company
certain financial accommodations on the terms and conditions contained herein;
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the parties hereto, the parties
hereto hereby agree as follows:
ARTICLE 1. DEFINITIONS
SECTION 1.1 DEFINITIONS.
In addition to terms defined elsewhere herein, the following terms
shall have the following meanings for the purposes of this Agreement:
"Absolute Rate" shall have the meaning assigned to such term in
Section 3.3.(c)(ii)(C) hereof.
"Agent Bank" shall mean NationsBank, N.A. (South) in its capacity as
agent for the Banks; provided, however, that if NationsBank, N.A. (South) shall
have resigned or been removed as Agent Bank, then "Agent Bank" shall mean the
bank selected as Agent Bank pursuant to the provisions of Section 11.8. hereof.
"Applicable Margin" shall mean, as of any date of determination, the
percentage rate set forth below for each type of Loan corresponding to the long
term senior unsecured debt rating of the Company, as rated by S&P (the "S&P
Rating") and Moody's (the "Moody's Rating"; each of the S&P Rating and the
Moody's Rating referred to herein as a "Rating"):
[Download Table]
===================================================================================
LONG TERM SENIOR UNSECURED APPLICABLE MARGIN
LEVEL DEBT RATING OF THE COMPANY FOR EURODOLLAR RATE APPLICABLE MARGIN
(S&P/MOODY'S) LOANS FOR BASE RATE LOANS
===================================================================================
1 BBB+ or higher or Baa1 or 0.30% 0%
higher
-----------------------------------------------------------------------------------
2 BBB or Baa2 0.33% 0%
-----------------------------------------------------------------------------------
3 BBB- or Baa3 0.375% 0%
-----------------------------------------------------------------------------------
4 BB+ or Ba1 0.50% 0%
-----------------------------------------------------------------------------------
5 BB or lower or Ba2 or lower 0.75% 0%
===================================================================================
The Agent Bank shall determine the Applicable Margin from time to time
in accordance with the above table and notify the Company and the Banks of such
determination from time to time. In the event the S&P Rating and the Moody's
Rating correspond to different levels on the above table resulting in different
Applicable Margin determinations, the following provisions shall apply. In the
event the S&P Rating and the Moody's Rating differ by one level, the Applicable
Margin shall be that corresponding to the higher Rating. For example, a "BBB+"
S&P Rating and a "Baa2" Moody's Rating would result in an Applicable Margin for
Eurodollar Rate Loans equal to 0.30%. In the event the S&P Rating and the
Moody's Rating differ by two levels, the Applicable Margin shall be that
corresponding to that level which is in between the two applicable levels. For
example, a "BBB" S&P Rating and a "Ba1" Moody's Rating would result in an
Applicable Margin for Eurodollar Rate Loans equal to 0.375%. In the event the
S&P Rating and the Moody's Rating differ by three levels, the Applicable Margin
shall be that corresponding to the level immediately above the lower of such
Ratings. For example, a "BBB+" S&P Rating and a "Ba1" Moody's Rating would
result in an Applicable Margin for Eurodollar Rate Loans equal to 0.375%. In the
event the S&P Rating and the Moody's Rating differ by four levels (i.e. a
ratings split between level 1 and level 5), the Applicable Margin shall be that
corresponding to level 4. For example, a "BBB+" S&P Rating and a "Ba2" Moody's
Rating would result in an Applicable Margin for Eurodollar Rate Loans equal to
0.50%.
In the event only one rating agency exists or continues rating the
Company's long term senior unsecured debt, such agency's rating shall be used
for purposes of the above table. In the event: (i) neither agency exists or
continues rating the Company's long term senior unsecured debt or (ii) the
Company no longer has any outstanding long term senior unsecured debt to be
rated, the Applicable Margin for the first 90 days after such occurrence shall
be the Applicable Margin in effect as determined using the above immediately
prior to such occurrence. During such 90-day period, the Agent Bank and the
Company shall negotiate in good faith to agree upon a new pricing grid or other
appropriate pricing terms. Any such new grid or pricing terms shall be approved
by the Majority Banks. In the event the Agent Bank, the Company and Majority
Banks cannot agree upon such new pricing grid or pricing terms by the end of
such 90-day period, the Applicable Margin shall be that corresponding to level 3
of the above table for the remainder of the term of the Agreement.
-2-
Any necessary adjustment in the Applicable Margin pursuant to the terms
hereof shall become effective immediately upon any change in a Rating.
"Available Commitment" shall mean, on any date, the Total Commitments
of the Banks in effect on such date minus the sum of: (i) the aggregate Stated
Amount of Letters of Credit outstanding on such date, (ii) the aggregate
outstanding principal amount of Syndicated Loans on such date, (iii) the
aggregate outstanding principal amount of Competitive Bid Loans on such date,
and (iv) any Reimbursement Obligations unpaid on such date (other than any such
Reimbursement Obligations to be paid on such date with the proceeds of a
Syndicated Loan).
"Base Rate" shall mean the rate per annum which is the Prime Rate in
effect from time to time at a majority of the Reference Banks (or if no two of
such Banks have the same Prime Rate in effect, the Prime Rate in effect at such
Bank whose Prime Rate is neither the highest nor the lowest) plus the Applicable
Margin.
"Base Rate Loan" shall mean any Syndicated Loan which bears interest at
the Base Rate.
"Business Day" shall mean any day during which the Main Office of the
Agent Bank is scheduled to be open for the conduct of its banking business and
during which national banking associations located in New York, New York and
Charlotte, North Carolina are open for the conduct of banking business.
"Commitment" shall have the meaning set forth in Section 2.1. hereof.
"Commitment Fee" shall mean the fee required to be paid to the Agent
Bank, for the account of the Banks, by the Company pursuant to Section 3.11.
hereof.
"Competitive Bid Loan" shall mean any Loan which bears interest at the
Absolute Rate.
"Competitive Bid Quote" shall mean an offer in accordance with Section
3.3. hereof by a Bank to make a Competitive Bid Loan with one single specified
interest rate.
"Competitive Bid Quote Request" shall have the meaning assigned to such
term in Section 3.3.(b) hereof.
"Convertible Subordinated Debt" shall mean any debt of the Company
convertible into shares of any or all classes of stock of the Company and
containing, or issued under agreements or indentures containing, provisions
effectively subordinating the same to the debt created by this Agreement.
-3-
"Credit Facility" shall mean the credit facility extended to the
Company by the Banks pursuant hereto.
"Current Debt" shall mean any obligation for borrowed money (including
notes payable and drafts accepted representing extensions of credit whether or
not representing obligations for borrowed money) payable on demand or within a
period of one year from the date of the creation thereof.
"Default" means any of the events specified in paragraphs (a) through
(h) of Section 9.1. hereof, whether or not there has been satisfied any
requirement for giving of notice, lapse of time or the happening of any other
condition.
"Dollar" and "$" shall mean lawful money of the United States of
America.
"Drawing" shall mean a drawing by a beneficiary under a Letter of
Credit.
"Effective Date" shall mean the date upon which: (i) all of the
conditions of Section 5.1. hereof have been satisfied and (ii) the Company has
paid to the Agent Bank the fees required by Section 3.17. hereof.
"Equity" shall mean the sum of: (i) the par value (or value stated on
the books of the Company) of the capital stock of all classes of the Company
(other than the Company's Series B ESOP Convertible Preferred Stock), (ii) the
amount of additional paid-in capital and reinvested earnings of the Company,
(iii) the amount of taxes deferred and unamortized investment tax credits under
Sections 167 and 168 of the Internal Revenue Code or similar provisions of any
applicable tax law and carried on the balance sheet under those captions, (iv)
the amount of any gain on the sale and leaseback of assets which is deferred
pursuant to generally accepted accounting principles, (v) the principal amount
of any Convertible Subordinated Debt outstanding, (vi) the amount of any
postretirement benefits (other than pensions) of the Company accrued in
accordance with the Statement of Financial Accounting Standards No. 106
(Financial Accounting Standards Board 1990) and generally accepted accounting
principles and classified as long term liabilities on the balance sheet of the
Company, and (vii) the difference between (a) the stated and liquidation value
of the Company's Series B ESOP Convertible Preferred Stock and (b) the unearned
compensation under the Company's employee stock ownership plan; minus (viii) the
unrealized loss on noncurrent marketable equity securities, net of any deferred
tax benefits, and minus (ix) treasury stock at cost.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time and any successor statute.
"Eurodollar Business Day" shall mean any day on which banks are
scheduled to be open for business and quoting interest rates for Dollar deposits
on the London interbank market and which is also a Business Day.
-4-
"Eurodollar Lending Office" shall mean with respect to each Bank the
office of such Bank identified as such from time to time to the Agent Bank and
the Company as the office of such Bank or of its affiliate at which the
Eurodollar Rate Loans held by such Bank are to be maintained.
"Eurodollar Rate" shall mean a rate per annum (rounded upward, if
necessary, to the nearest 1/100th of 1%) determined by Agent Bank pursuant to
the following formula:
Eurodollar Rate = LIBOR plus Applicable Margin.
"LIBOR" shall mean, with respect to any Interest Period for Eurodollar Rate
Loans, the offered rate in the London interbank market for deposits in United
States dollars of amounts equal or comparable to the principal amount of such
Eurodollar Rate Loan offered for a term comparable to such Interest Period, as
currently shown on the Reuters Screen LIBO page as of 11:00 a.m., GMT, two
Eurodollar Business Days prior to the first day of such Interest Period;
provided, however, that (A) if more than one offered rate as described above
appears on the Reuters Screen LIBO page, the rate used to determine LIBOR will
be the arithmetic average (rounded upward, if necessary, to the next higher
1/100 of 1%) of such offered rates, or (B) if no such offered rates appear, the
rate used for such Interest Period will be the arithmetic average (rounded
upward, if necessary, to the next higher 1/100 of 1% ) of rates quoted by the
Reference Banks at approximately 10:00 a.m., New York time, two Eurodollar
Business Days prior to the first day of such Interest Period for deposits in
United States dollars offered to leading European banks for a period comparable
to such Interest Period in an amount comparable to the principal amount of such
Eurodollar Rate Loans. If the Agent Bank ceases to use the Reuters Screen LIBO
page for determining interest rates based on eurodollar deposit rates, a
comparable internationally recognized interest rate reporting service shall be
used to determine such offered rates.
"Eurodollar Rate Loan" shall mean any Syndicated Loan which bears
interest at the Eurodollar Rate.
"Event of Default" means any one of the events specified in paragraphs
(a) through (h) of Section 9.1. hereof, provided that any requirement for notice
or lapse of time or other condition contained therein has been satisfied.
"Funded Debt" shall mean any obligation for borrowed money or the
deferred purchase price of property, or any obligation arising under a capital
lease, other than Convertible Subordinated Debt, payable more than one year from
the date of the creation thereof which, under generally accepted accounting
principles in effect from time to time, is shown on the balance sheet of the
obligor as a liability; provided that any obligation shall be treated as Funded
Debt, regardless of its term, if such obligation is renewable pursuant to the
terms thereof or of a revolving credit or similar agreement effective for more
than one (1) year after the date of the creation of such obligation or may be
payable
-5-
out of the proceeds of a similar obligation pursuant to the terms of such
obligation or of any such agreement.
"Immediate Replacement Event" shall mean a change in any law, rule, or
regulation, or any change in the interpretation or administration thereof, or, a
new law, rule, or regulation, having any of the consequences specified in
Section 10.1. hereof.
"Interest Period" means (i) for each Eurodollar Rate Loan, the period
beginning on the date of such Loan or conversion thereof or on the last day of
an immediately preceding Interest Period for such Loan and ending one, two,
three, or six months later, as specified in the notice given by the Company to
the Agent Bank; provided, however, that if the last day of any Interest Period
would fall on a day which is not a Eurodollar Business Day that Interest Period
shall be extended to the next succeeding day which is a Eurodollar Business Day,
unless the result of such extension should be to carry such Interest Period to
the next succeeding calendar month in which event such Interest Period shall end
on the immediately preceding Eurodollar Business Day, further provided that any
Interest Period that would extend beyond the Termination Date shall end on such
date and (ii) for each Competitive Bid Loan, the period beginning on the date of
borrowing of such Competitive Bid Loan and ending on such Business Day as may be
mutually agreed upon by the Company and the Bank or Banks making such
Competitive Bid Loan or Loans, as the case may be, comprising such Competitive
Bid Loan; provided, however, that (i) no Competitive Bid Loan shall have an
Interest Period greater than 180 days and (ii) any Interest Period that would
extend beyond the Termination Date shall end on such date.
"Interest Rate" shall mean:
(a) With respect to a Competitive Bid Loan, the Absolute Rate;
(b) With respect to a Eurodollar Rate Loan, the Eurodollar Rate;
and
(c) With respect to a Base Rate Loan, the Base Rate.
"L/C Commitment Amount" shall mean $700,000,000.
"Letter of Credit Banks" shall mean NationsBank, N.A. (South)or any
other Bank under this Agreement approved by the Company that agrees, pursuant to
documentation in form and substance satisfactory to the Agent Bank and the
Company, to issue Letters of Credit hereunder.
"Loans" shall mean, collectively, the Syndicated Loans and the
Competitive Bid Loans.
"Main Office" of the Agent Bank shall be NationsBank, N.A. (South), 600
Peachtree Street, Atlanta, Georgia.
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"Majority Banks" shall mean, as of any date, Banks on such date having
Credit Exposures (as defined below) aggregating at least 51% of the aggregate
Credit Exposures of all the Banks on such date. For purposes of the preceding
sentence, the amount of the "Credit Exposure" of each Bank shall be equal to:
(i) prior to the occurrence of an Event of Default and the acceleration of the
Loans pursuant to the terms hereof, the aggregate principal amount of the
Syndicated Loans owing to such Bank plus the unutilized amount of such Bank's
Commitment and (ii) after an Event of Default has occurred and the Loans have
been accelerated pursuant to the terms hereof, the aggregate principal amount of
Syndicated Loans and Competitive Bid Loans owing to such Bank plus the
unutilized amount of such Bank's Commitment.
"Moody's" shall mean Moody's Investors Services, Inc.
"Moody's Rating" has the meaning set forth in the definition of
Applicable Margin.
"Notes" shall have the meaning set forth in Section 3.4. hereof.
"Officer's Certificate" shall mean a certificate signed by the Chairman
of the Board, the President, or a principal financial officer of the Company.
"Orderly Replacement Event" shall mean as to any Eurodollar Rate Loan,
the determination by the Agent Bank not later than two (2) Eurodollar Business
Days prior to the first day of any Interest Period that: (a) for any reason
whatsoever rates are not quoted for the offering of Dollars in the London
interbank market for deposit for a period comparable to such Interest Period; or
(b) the quoted rate for purposes of computing the rate of interest on the
Eurodollar Rate Loan does not accurately reflect the funding cost to the Banks
of making or maintaining such Loans.
"Person" shall mean and include an individual, a partnership, a joint
venture, an estate, a corporation, a trust, an unincorporated organization, a
limited liability company, and a government or any department or agency or
political subdivision thereof.
"Prime Rate" shall mean, for any day, the rate which is quoted by each
Reference Bank as the respective bank's prime, reference, base, or alternate
base rate, as the case may be. The Company acknowledges that the Prime Rate of
any Reference Bank may not be the lowest or best interest rate offered by such
Reference Bank to its customers.
"Rating" has the meaning set forth in the definition of Applicable
Margin.
"Reference Banks" means Citibank, N.A., Bank of America National Trust
and Savings Association and the Agent Bank, and each of their respective
successors and assigns.
"Reimbursement Obligation" shall mean the obligation of the Company to
reimburse the Agent Bank for any Drawing pursuant to Section 4.4. hereof.
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"Required Number" shall mean in the case of notices relating to
Syndicated Loans hereunder to the Agent Bank: (a) relative to borrowings,
prepayments, elections of, and conversions into, the Eurodollar Rate, selections
of Interest Periods and other transactions in respect of Eurodollar Rate Loans,
not less than three (3) Eurodollar Business Days; and (b) relative to all
transactions in respect to Base Rate Loans, not less than one Business Day.
"S&P" shall mean Standard & Poor's Ratings Services.
"S&P Rating" has the meaning set forth in the definition of Applicable
Margin.
"Stated Amount" shall mean the amount available to be drawn by a
beneficiary under a Letter of Credit outstanding under this Agreement from time
to time, as such amount may be increased or reduced from time to time in
accordance with the terms of such Letter of Credit.
"Subsidiary" shall mean any corporation, association or other business
entity, a majority (by number of votes) of the outstanding stock or other
ownership interest of which is, at the time at which any determination is being
made, owned by the Company either directly or through Subsidiaries.
"Syndicated Loan" shall mean, collectively, the Eurodollar Rate Loans
and the Base Rate Loans.
"Termination Date" shall mean May 1, 2002 (or the date to which the
Credit Facility has been extended pursuant to Section 3.18. hereof) unless the
Credit Facility is earlier terminated pursuant to the applicable provisions of
this Agreement."
"Total Commitments of the Banks" shall have the meaning set forth in
Section 2.1. hereof.
ARTICLE 2. AMOUNT AND TERMS OF CREDIT
SECTION 2.1. COMMITMENT.
Each Bank severally agrees to extend credit to the Company at any time
and from time to time from the date hereof until the Termination Date in the
manner and upon, and subject to, the terms and conditions hereinafter set forth
up to an amount at any one time outstanding equal to such Bank's Commitment as
set forth in Section 2.2. hereof, as such Commitment may be adjusted from time
to time in accordance with the terms of this Agreement; provided, however, that
any Loan made hereunder shall not exceed the Available Commitment in effect at
such time. The participation of each Bank in the Credit Facility shall consist
of each such Bank's respective Commitment as stated opposite such Bank's name in
Section 2.2. hereof as such Commitment may be adjusted from time to
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time in accordance with the terms of this Agreement. The obligation of each Bank
to make Syndicated Loans to the Company, and to participate in the Reimbursement
Obligations with respect to Letters of Credit issued hereunder, is hereby
referred to as the Bank's "Commitment" and collectively as the "Total
Commitments of the Banks".
SECTION 2.2. THE BANKS.
[Download Table]
BANK COMMITMENT
---- ----------
AGENT BANK
----------
NationsBank, N.A. (South) $ 100,000,000
MANAGING AGENTS
---------------
Bank of America, National Trust and
Savings Association 85,000,000
The Chase Manhattan Bank 85,000,000
Citicorp USA, Inc. 85,000,000
Royal Bank of Canada 85,000,000
CO-MANAGING AGENTS
------------------
The Mitsubishi Trust and Banking Corporation 70,000,000
SunTrust Bank, Atlanta 70,000,000
Wachovia Bank of Georgia, N.A. 70,000,000
CO-AGENTS
---------
The Bank of Tokyo-Mitsubishi, Ltd., New York Branch 55,000,000
CIBC Inc. 55,000,000
The Industrial Bank of Japan, Limited, Atlanta Agency 55,000,000
The Northern Trust Company 55,000,000
PARTICIPANTS
------------
Bank of Montreal 30,000,000
The Bank of New York 30,000,000
Bayerische Vereinsbank AG 30,000,000
The Dai-Ichi Kangyo Bank, Limited, Atlanta Agency 30,000,000
The First National Bank of Chicago 30,000,000
Kredietbank N.V., Grand Cayman Branch 30,000,000
PNC Bank, National Association 30,000,000
The Sanwa Bank, Limited, Atlanta Agency 30,000,000
The Toyo Trust & Banking Co., Ltd. 30,000,000
Morgan Guaranty Trust Company of New York 27,500,000
The Fuji Bank, Limited 22,500,000
Credit Lyonnais New York Branch 20,000,000
Star Bank, N.A. 20,000,000
The Sumitomo Bank, Limited 20,000,000
Total Commitments of the Banks $1,250,000,000
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SECTION 2.3. INCREASES IN THE TOTAL COMMITMENTS OF THE BANKS.
(a) The Company, the Agent Bank, the Letter of Credit Banks and the
Banks acknowledge and agree that the aggregate principal amount of the Total
Commitments of the Banks may be increased from time to time in accordance with
this Section 2.3. So long as no Event of Default then exists or would be caused
thereby, the Total Commitments of the Banks may be increased by up to
$250,000,000 from that in existence on the Effective Date at any time with the
prior written consent of the Agent Bank, which will not be unreasonably
withheld. So long as no Event of Default then exists or would be caused thereby,
the Total Commitments of the Banks may be increased by up to $500,000,000 from
that in existence on the Effective Date, with the prior written consent of the
Agent Bank and the Majority Banks. Any increase in the Total Commitments of the
Banks beyond the parameters set forth above or other than as expressly permitted
by this Section 2.3. shall require the prior written consent of the Agent Bank
and each of the Banks. No increase in the Total Commitments of the Banks
pursuant to this Section 2.3. shall effect an increase in the aggregate dollar
amount of the Commitment of any Bank hereunder other than as a result of an
express written agreement between the Company and such Bank.
(b) Any increase in the Total Commitments of the Banks contemplated by
paragraph (a) above may be effected as a result of an agreement by any Bank
hereunder to increase the Commitment of such Bank hereunder, provided that the
following conditions are satisfied:
(i) The Bank which has agreed to increase its Commitment
hereunder and the Company and such Bank shall jointly notify the Agent
Bank, in writing, of (A) the agreement of such Bank to increase its
Commitment hereunder, (B) the aggregate principal amount of the
increase in such Bank's Commitment and (C) the effective date of such
agreement, which notice shall be substantially in the form of Exhibit B
attached hereto; and
(ii) The Company shall execute and deliver to such Bank a
new Note to the order of such Bank in an original principal amount
equal to the aggregate principal amount of the increase in such Bank's
Commitment hereunder.
(c) Any increase in the Total Commitments of the Banks contemplated by
paragraph (a) above may also be effected as a result of an agreement by a
financial institution which is not then a Bank hereunder to become a Bank
hereunder, provided that the following conditions are satisfied prior to or
contemporaneously with the effectiveness of the increase in the Total
Commitments of the Banks:
(i) The financial institution which has agreed to become
a Bank hereunder shall execute and deliver to the Agent Bank, for
itself and on behalf of the Banks, an agreement to assume the rights
and obligations of a Bank hereunder
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and to accept and ratify, in full, the terms of this Agreement, which
agreement shall set forth (A) the aggregate principal amount of such
institution's Commitment hereunder, (B) the effective date of such
agreement and (C) such institution's address for notices pursuant to
Section 12.2. hereof, and which agreement shall be substantially in the
form of Exhibit C-1 attached hereto, and which shall be acknowledged
and agreed to by the Company; and
(ii) the Company shall execute and deliver to such
institution a Note to the order of such institution in an original
principal amount equal to the aggregate principal amount of such
institution's Commitment hereunder.
Upon the Agent Bank's receipt of the items described in clause (c)(i) above,
together with any other agreement, amendment or other document which the Agent
Bank deems necessary to implement the intent and terms of this Section 2.3. (all
of which shall be in form and substance satisfactory to the Agent Bank), such
financial institution shall thereupon and thereafter be deemed to be a Bank for
all purposes hereunder.
(d) The amount of the Total Commitments of the Banks hereunder shall be
deemed to be increased (i) by the aggregate principal amount by which any
existing Bank hereunder increases its Commitment hereunder in accordance with
Section 2.3.(b) above, and (ii) by the aggregate principal amount of any
Commitment hereunder by any new financial institution in accordance with Section
2.3.(c) hereof. Simultaneously with any increase in the Total Commitments of the
Banks pursuant to, and in accordance with, this Section 2.3., the respective pro
rata share of the Banks (including any new Banks) of the Total Commitments of
the Banks shall be deemed to be automatically adjusted to reflect the increase
in the amount of the Total Commitments of the Banks and the Agent Bank shall
notify the Banks of such increase and of each Bank's new pro rata share
hereunder.
(e) Any increase in the Total Commitments of the Banks hereunder shall
not affect any other term or condition of this Agreement. However, any such
increase in the Total Commitments of the Banks shall cause a reallocation of
each Bank's pro rata share of each Syndicated Loan and/or each Letter of Credit
outstanding on the effective date of such increase. Such reallocation shall be
accomplished by a payment to the Agent Bank, for the account of the Banks, by
(a) the existing Bank that has increased its Commitment or (b) the new financial
institution that has become a Bank, as the case may be, of an amount equal to
such Bank's pro rata share of all outstanding Syndicated Loans and unpaid
Reimbursement Obligations. The Agent Bank shall then immediately transmit the
applicable pro rata share of such payment so received by the Agent Bank in
immediately available funds to each Bank entitled thereto in the manner
specified by such Bank. The existing Bank increasing its Commitment or the new
financial institution that has become a Bank shall be deemed to have
automatically assumed its pro rata share of the obligations set forth in Section
4.1.(b) hereof with respect to all issued and outstanding Letters of Credit.
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ARTICLE 3. THE LOANS
SECTION 3.1. SYNDICATED LOANS.
Subject to the terms and conditions hereof, during the period from the
Effective Date to the Termination Date, each Bank severally and not jointly
agrees to make Syndicated Loans to the Company in an aggregate principal amount
at any one time outstanding up to, but not exceeding, such Bank's Commitment;
provided, however, that any given borrowing of Syndicated Loans made pursuant to
this Section 3.1. shall not exceed the Available Commitment at the time of such
borrowing. Subject to the terms and conditions of this Agreement, during the
period from the Effective Date to the Termination Date, the Company may borrow,
repay and reborrow Syndicated Loans hereunder.
SECTION 3.2. NOTICE AND PLACE OF BORROWING FOR SYNDICATED LOANS.
The Company shall give written, facsimile or telephonic (confirmed
immediately in writing) notice to the Agent Bank, such notice to be given not
later than 11:00 a.m. Atlanta, Georgia time on a Business Day which is at least
the Required Number of days prior to each borrowing of Syndicated Loans and to
contain the date of such borrowing, the amount of such borrowing, the Interest
Rate option selected, and, where applicable, the length of the Interest Period.
Upon receiving notice from the Company, the Agent Bank shall promptly give
written, facsimile or telegraphic notice to each Bank, such notice to contain
the date of such borrowing, the amount to be borrowed from such Bank, the
Interest Rate option selected, and, where applicable, the length of the Interest
Period. Funds are to be disbursed pursuant to this Agreement at the Main Office
of the Agent Bank. Not later than 11:00 a.m. Atlanta time on the date of
borrowing of Syndicated Loans as specified in the notice from the Agent Bank to
the Banks, each Bank shall have made available at the Main Office of the Agent
Bank, in immediately available funds, the amount of Syndicated Loans to be
advanced by such Bank, and the Agent Bank shall immediately pay such funds to or
upon the order of the Company. Unless the Agent Bank shall have received notice
from a Bank prior to the date of any such borrowing that such Bank will not make
available to the Agent Bank such Bank's ratable portion of such borrowing, the
Agent Bank may assume that such Bank has made such portion available to the
Agent Bank on the date of such borrowing in accordance with this Section 3.2.,
and the Agent Bank may, in reliance upon such assumption, make available to the
Company on such date a corresponding amount. If and to the extent such Bank
shall not have made such ratable portion available to the Agent Bank, such Bank
and the Company severally agree to repay to the Agent Bank immediately on demand
such corresponding amount together with interest thereon, for each day from the
date such amount is made available to the Company and until the date such amount
is repaid to the Agent Bank, at (i) with respect to the Company, the interest
rate applicable at the time to the type of Loan comprising such borrowing, or
(ii) with respect to the Bank, at the applicable overnight federal funds rate.
If such Bank shall repay to the Agent Bank such corresponding
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amount, such amount so repaid shall constitute such Bank's advance as part of
such borrowing for purposes of this Agreement.
SECTION 3.3. COMPETITIVE BID LOANS.
(a) Competitive Bid Loans. Subject to the terms and conditions hereof,
during the period from the Effective Date to the Termination Date, the Company
may request the Banks to make offers to make Competitive Bid Loans to the
Company in Dollars. The Banks may, but shall have no obligation to, make such
offers and the Company may, but shall have no obligation to, accept any such
offers in the manner set forth in this Section 3.3. There may be no more than
ten different Interest Periods for both Syndicated Loans and Competitive Bid
Loans outstanding at the same time. There shall not be outstanding at any one
time more than ten Competitive Bid Loans. Further, the aggregate principal
amount of all Competitive Bid Loans outstanding at any time, together with the
aggregate principal amount of all Syndicated Loans outstanding at such time, the
aggregate Stated Amount of Letters of Credit outstanding at such time and all
Reimbursement Obligations outstanding at such time shall not exceed the Total
Commitments of the Banks in effect at such time. However, the aggregate
principal amount of Competitive Bid Loans extended by a Bank hereunder from time
to time may exceed the Commitment of such Bank then in effect at such time.
Further, for purposes of this Agreement, Competitive Bid Loans made pursuant to
the same Competitive Bid Quote Request and having the same maturity date but
extended by different Banks shall be deemed to be a single Competitive Bid Loan
made hereunder.
(b) Request for Competitive Bid Loans. When the Company elects to
request offers to make Competitive Bid Loans, it shall give the Agent Bank
notice (a "Competitive Bid Quote Request") to be received by the Agent Bank no
later than 11:00 a.m. Atlanta, Georgia time on the date one Business Day prior
to the date of borrowing proposed therein (or such other time and date as the
Company and the Agent Bank, with the consent of the Majority Banks, may agree).
The Company may request offers to make Competitive Bid Loans for up to two
different Interest Periods in a single notice; provided, however, that the
request for each separate Interest Period shall be deemed to be a separate
Competitive Bid Quote Request for a separate borrowing. In connection with any
Competitive Bid Quote Request, the Company shall furnish each Bank with the
following as to each Competitive Bid Loan:
(i) the proposed date of a borrowing of such Competitive
Bid Loan, which shall be a Business Day;
(ii) the amount of such Competitive Bid Loan, which shall
be at least $10,000,000 (and integral multiples of $1,000,000 in excess thereof)
but shall not cause the limits specified in paragraph (a) above to be violated;
(iii) the duration of the Interest Period applicable
thereto; and
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(iv) the date on which the Competitive Bid Quotes are to
be submitted if it is before the proposed date of borrowing (the date on which
such Competitive Bid Quotes are to be submitted is called the "Quotation Date").
Except as otherwise provided in this Section 3.3.(b), no Competitive Bid Quote
Request will be made by the Company within five (5) Business Days (or such other
number of days as the Company and the Agent Bank, with the consent of the
Majority Banks, may agree) of any other Competitive Bid Quote Request.
(c) Competitive Bid Quotes.
(i) Each Bank may submit one or more Competitive Bid
Quotes, each containing an offer to make a Competitive Bid Loan in response to
any Competitive Bid Quote Request; provided, however, that, if the Company's
request under paragraph (b) above specified more than one Interest Period, such
Bank may make a single submission containing one or more Competitive Bid Quotes
for each such Interest Period. Each Competitive Bid Quote must be submitted to
the Company not later than 10:30 a.m. Atlanta, Georgia time on the Quotation
Date (or such other time and date as the Company and the Agent Bank, with the
consent of the Majority Banks, may agree). Subject to terms hereof, any
Competitive Bid Quote so made shall be irrevocable once made except with the
consent of the Agent Bank given on the instructions of the Company.
(ii) Each Competitive Bid Quote may be given to the
Company by telephone and shall be promptly confirmed in writing via facsimile.
Such confirmation shall be substantially in the form of Exhibit E hereto and
shall specify:
(A) the proposed date of borrowing and the Interest
Period therefor;
(B) the principal amount of the Competitive Bid Loan
for which each such offer is being made, which principal amount shall be at
least $10,000,000 (and integral multiples of $1,000,000 in excess thereof);
provided that (1) the aggregate principal amount of all Competitive Bid Loans
for which a Bank submits Competitive Bid Quotes may not exceed the maximum
aggregate principal amount of the Available Commitment and (2) the Company may
not accept Competitive Bid Quotes that would result in an aggregate principal
amount outstanding greater than the then current Available Commitment;
(C) the rate of interest per annum (rounded upwards,
if necessary, to the nearest 1/10,000th of 1%) offered for each such Competitive
Bid Loan (the "Absolute Rate"); and
(D) the identity of the quoting Bank.
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Unless otherwise agreed by the Agent Bank and the Company, no Competitive Bid
Quote shall contain qualifying, conditional or similar language or propose terms
other than or in addition to those set forth in the applicable Competitive Bid
Quote Request and, in particular, no Competitive Bid Quote may be conditioned
upon acceptance by the Company of all (or some specified minimum) of the
principal amount of the Competitive Bid Loan for which such Competitive Bid
Quote is being made.
(d) Notification by Company. The Company shall, as promptly as
practicable after the Competitive Bid Quotes are submitted (but in any event not
later than 11:30 a.m. Atlanta, Georgia time on the Quotation Date), notify the
Agent Bank of the terms (i) of any Competitive Bid Quote submitted by a Bank
that is in accordance with Section 3.3.(c) hereof and (ii) of any Competitive
Bid Quote that amends, modifies or is otherwise inconsistent with a previous
Competitive Bid Quote submitted by such Bank with respect to the same
Competitive Bid Quote Request. Any such subsequent Competitive Bid Quote shall
be disregarded by the Company unless such subsequent Competitive Bid Quote is
submitted solely to correct a manifest error in such former Competitive Bid
Quote. The Company's notice to the Agent Bank shall specify (A) the aggregate
principal amount of the Competitive Bid Loan borrowing for which offers have
been received and (B) the respective principal amounts and Absolute Rates so
offered by each Bank (identifying the Bank that made each Competitive Bid
Quote).
(e) Acceptance of Competitive Bid Quotes. In the case of acceptance of
Competitive Bid Quotes, such notice shall be substantially in the form of
Exhibit F and shall specify the aggregate principal amount of offers that are
accepted for each Interest Period and shall be delivered to the Agent Bank and
all Banks whose competitive Bid Quotes have been accepted by the Company not
later than 1:00 p.m. Atlanta, Georgia time on the Quotation Date. The Company
may accept any Competitive Bid Quote in whole or in part if the following
conditions are met:
(i) the aggregate principal amount of each borrowing of a
Competitive Bid Loan may not exceed the applicable amount set forth in the
related Competitive Bid Quote Request;
(ii) the aggregate principal amount of each borrowing of a
Competitive Bid Loan shall be at least $10,000,000 (and integral multiples of
$1,000,000 in excess thereof) but shall not cause the limits specified in
Section 3.3.(a) hereof to be violated;
(iii) except as provided below, acceptance of offers may be
made only in ascending order of Absolute Rates in each case beginning with the
lowest rate so offered; and
(iv) the Company may not accept any offer where such offer
fails to comply with Section 3.3.(c) hereof or otherwise fails to comply with
the requirements of this Agreement (including, without limitation, this Section
3.3.).
-15-
In the event that two or more Banks quote the same Absolute Rates for a related
Interest Period and the aggregate principal amount, after acceptance of all
lower Absolute Rates, is greater than the principal amount for which the Company
has requested Competitive Bid Quotes, then the principal amount of Competitive
Bid Loans shall be allocated by the Company in proportion to the aggregate
principal amount of such offers. Determinations by the Company of the amounts of
Competitive Bid Loans and the lowest bid shall be conclusive in the absence of
manifest error.
(f) Bank's Obligation to Make Competitive Bid Loans. Any Bank whose
offer to make any Competitive Bid Loan has been accepted shall, not later than
1:00 p.m. Atlanta, Georgia time on the date specified for the making of such
Loan, make the amount of such Loan available to the Company on such date by
depositing the same, in Dollars and in immediately available funds, in an
account designated by the Company for the deposit of such funds. Subject to the
last sentence of Section 3.3.(a), the making of Competitive Bid Loans by a Bank
shall not affect or reduce the obligation of such Bank to make Syndicated Loans
under Section 3.1. hereof.
(g) Repayment of Competitive Bid Loans. Unless payable earlier pursuant
to the terms hereof, the Company shall repay the outstanding principal amount
of, and all accrued but unpaid interest on, each Competitive Bid Loan at the end
of the Interest Period applicable thereto.
SECTION 3.4. THE NOTES.
Each of the Syndicated Loans made pursuant to this Agreement shall be
evidenced by a promissory note executed and delivered by the Company in form
substantially the same as Exhibit A-1 attached hereto and made a part hereof
(each a "Syndicated Note"), each dated the date of this Agreement, each drawn to
the order of one of the Banks in the amount of such Bank's respective
Commitment, and each maturing on the Termination Date. Each of the Competitive
Bid Loans made pursuant to this Agreement shall be evidenced by a promissory
executed and delivered by the Company in form substantially the same as Exhibit
A-2 attached hereto and made a part hereof (each a "Competitive Bid Note"), each
dated the date of this Agreement, drawn to the order of the Bank making such
Competitive Bid Loan, and each maturing on the Termination Date. Each of the
Syndicated Notes and the Competitive Bid Notes are hereinafter referred to as
the "Notes" and each as a "Note". Each Bank's records with respect to advances
and repayments of Loans hereunder shall, absent manifest error, be deemed to
prevail as to the Company's obligations hereunder.
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SECTION 3.5. INTEREST.
The Company shall pay interest on the outstanding principal amount of
each Loan for the period commencing on the date of each such Loan until such
Loan shall be due and payable at the rates and times set forth below.
(a) Interest on Eurodollar Rate Loans. Subject to the provisions of
subsection (d) immediately below, interest on each Eurodollar Rate Loan shall be
payable (i) on the last day of each Interest Period with respect thereto;
provided, however, that if such Interest Period is for a period of duration in
excess of three months, then such interest shall also be payable on the date
three months after the first day of such Interest Period, (ii) on the date of
conversion of such Eurodollar Rate Loan to a Base Rate Loan and (iii) at
maturity of such Loan (and after maturity of such Loan (whether by acceleration
or otherwise) upon demand), at an interest rate per annum during the Interest
Period for such Loan equal to the Eurodollar Rate for the Interest Period in
effect for such Eurodollar Rate Loan. Each determination by the Agent Bank of an
interest rate hereunder shall be conclusive and binding on the Banks and the
Company for all purposes, absent manifest error.
(b) Interest on Base Rate Loans. Subject to the provisions of
subsection (d) immediately below, interest on each Base Rate Loan shall be
payable quarterly in arrears on the last day of each March, June, September and
December of each year and at maturity (and after maturity (whether by
acceleration or otherwise) upon demand) at an interest rate per annum equal to
the Base Rate.
(c) Interest on Competitive Bid Loans. Subject to the provisions of
subsection (d) immediately below, interest on each Competitive Bid Loan shall be
payable for each Interest Period applicable thereto on the last day of such
Interest Period (and after maturity (whether by acceleration or otherwise) upon
demand); provided, however, that if such Interest Period is for a period of
duration in excess of three months, then such interest shall also be payable on
the date three months after the first day of such Interest Period at a rate per
annum equal to the Absolute Rate applicable to such Competitive Bid Loan.
(d) Interest Upon Event of Default. Any payment of principal or
interest on any Loan which is not paid when due, as herein provided, shall bear
interest (to the extent permitted by law) at that rate which is one-quarter of
one percent (1/4%) above the Base Rate in effect on each respective day
thereafter until paid in full and such interest shall be payable on demand.
(e) Prepayment. Upon prepayment of any Loan hereunder, interest accrued
and unpaid on the amount so prepaid shall become due on the date of such
prepayment.
(f) Computations. Interest on Base Rate Loans shall be computed on the
basis of a year of 365/366 days and an actual day month. Interest on Eurodollar
Rate Loans
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and Competitive Bid Loans shall be computed on the basis of a year of 360 days
and an actual day month.
SECTION 3.6. PLACE OF PAYMENT.
Each payment (whether required or voluntary and whether of principal or
interest or both) on each Note and each payment of fees or other amounts owing
by the Company hereunder shall be payable, on or before 11:00 a.m., Atlanta
time, on the due date of each payment, in immediately available funds, to the
Agent Bank at its Main Office at such account as the Agent Bank shall from time
to time notify the Company in writing. The Agent Bank shall then immediately
transmit the applicable pro rata share of such payment, in the case of a
Syndicated Loan, and, subject to Section 3.8. hereof, the full amount of such
payment in the case of a Competitive Bid Loan, so received by the Agent Bank in
immediately available funds to each Bank entitled thereto in the manner
specified by such Bank. Any required payment which would otherwise be due on a
day not a Business Day shall be made on the immediately succeeding Business Day.
SECTION 3.7. VOLUNTARY PREPAYMENT.
The Company may voluntarily prepay, at any time and from time to time
prior to maturity on one day's prior notice to the Agent Bank, any part or the
whole of the principal of the Notes; provided, however, that any voluntary
prepayment shall be in a minimum amount of $25,000,000 and integral multiples of
$5,000,000 in excess thereof. Upon any such prepayment, the Company shall
simultaneously pay all accrued and unpaid interest on the amount of principal
voluntarily prepaid. However, any such prepayment of a Competitive Bid Loan or
Eurodollar Rate Loan shall be made only on the last day of the Interest Period
therefor. Any such voluntary prepayment of principal shall, in the case of a
Syndicated Loan, to that extent increase the amount (immediately prior to such
prepayment) of the unused Total Commitments of the Banks available to the
Company under the terms of this Agreement. All voluntary prepayments provided
for in this Section 3.7. shall be without premium or penalty.
SECTION 3.8. PRO RATA TREATMENT.
Except for Competitive Bid Loans and Section 3.14. hereof, and except
with respect to payments to be made to a Bank pursuant to Sections 3.10., 3.15.
or 12.3. and any other indemnity in favor of a Bank or Banks hereunder, each
borrowing from, payment to, and utilization of and reduction of the Commitments
of, the Banks hereunder shall, be prorated among the Banks according to the
respective Commitments of the Banks as set forth in Section 2.2. hereof, as the
same may be adjusted from time to time under Section 2.3., 3.13., 3.14. or 3.15.
hereof. Each borrowing of Syndicated Loans hereunder shall (in the aggregate) be
made in integral multiples of $5,000,000, with a minimum of $25,000,000;
provided, however, that any Syndicated Loans made pursuant to Section
4.4.(c)(ii) may, in the aggregate, be in the amount necessary to reimburse the
Agent Bank. Except as otherwise provided herein, (i) payments with respect to
the outstanding principal of, or accrued interest on, the Syndicated Loans shall
be made pro
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rata to only those Banks that funded such Loans (including any Bank that
advanced monies pursuant to the provisions of Section 2.3.(e) hereof) and not to
any defaulting Bank or a Bank not otherwise participating in such Loan, (ii) so
long as no Event of Default has occurred, each payment of principal and interest
on the Competitive Bid Loans shall be made to the Agent Bank for the account of
the respective Bank making such Competitive Bid Loan, and the principal amount
of Competitive Bid Loans shall be paid on the last day of the Interest Period
for such Competitive Bid Loan, (iii) after the occurrence of an Event of
Default, each payment on account of principal and interest on any outstanding
Loans shall be made to the Agent Bank for the account of the Banks pro rata in
accordance with the aggregate principal amount of all Loans then outstanding,
and (iv) all payments to be made by the Company for the account of each of the
Banks on account of principal, interest and fees, shall be made without set-off
or counterclaim.
SECTION 3.9. INITIAL DETERMINATION OF INTEREST RATE AND CONVERSION OF LOANS
BETWEEN EURODOLLAR RATE AND BASE RATE.
Prior to the initial or any subsequent borrowings, the Company will
specify the Interest Rate to be applicable to such borrowings, and on any
Business Day or Eurodollar Business Day, as applicable, the Company may convert
on a pro rata basis among the Banks any outstanding Base Rate Loans or
Eurodollar Rate Loans into the other type of Syndicated Loans, subject to the
following limitations:
(a) No such conversion of any Eurodollar Rate Loan may be made except
on the last day of an Interest Period with respect thereto; and
(b) The Company shall give Agent Bank the Required Number of days
notice for such borrowing or conversion.
If, at the end of an Interest Period of a Eurodollar Rate Loan, the Company has
failed to specify in a timely manner the Interest Rate option applicable to such
Loan for the period after the expiration of the then current Interest Period,
the Company shall be deemed to have selected that such Loan shall bear interest
at the Base Rate and, at the end of such Interest Period, such Loan shall
automatically convert to a Base Rate Loan.
SECTION 3.10. FAILURE TO BORROW.
The Company shall indemnify and hold harmless each Bank in respect of
any funding costs and/or losses in the event that any borrowing notified to the
Banks pursuant to Section 3.2. or 3.3., relative to Eurodollar Rate Loans or
Competitive Bid Loans, shall not be consummated because of the Company's failure
to satisfy one or more of the applicable conditions precedent in Article 5. or
because the Company fails to borrow such Loans at the specified time.
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SECTION 3.11. COMMITMENT FEE.
The Company shall pay to the Agent Bank, for the account of the Banks
to be distributed to the Banks pro rata in accordance with their respective
Commitments, a Commitment Fee on the daily average amount of the Available
Commitment for the period from the Effective Date to the Termination Date at the
per annum percentage rate set forth below corresponding to the long term senior
unsecured debt rating of the Company, as rated by S&P and Moody's, respectively,
in effect from time to time; provided, however, that, solely for purposes of
calculating the Commitment Fee under this Section 3.11., the outstanding
principal amount of all Competitive Bid Loans shall not be subtracted when
determining the Available Commitment.
[Download Table]
==================================================================
LONG TERM SENIOR UNSECURED DEBT
RATING OF THE COMPANY COMMITMENT FEE
LEVEL (S&P/MOODY'S) PERCENTAGE
==================================================================
1 BBB+ or higher or Baa1 or higher 0.10%
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2 BBB or Baa2 0.11%
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3 BBB- or Baa3 0.125%
------------------------------------------------------------------
4 BB+ or Ba1 0.15%
------------------------------------------------------------------
5 BB or lower or Ba2 or lower 0.25%
==================================================================
Commitment Fee shall be computed on the basis of a year of 365/366 days, on an
actual day month. Accrued Commitment Fee shall be payable in arrears and in
immediately available funds on the last day of each March, June, September and
December during the term of this Agreement and on the Termination Date,
commencing on June 30, 1997. The Agent Bank shall forthwith pay to each Bank its
ratable share of each payment of Commitment Fee under this Section 3.11. in
immediately available funds.
The Agent Bank shall determine the Commitment Fee from time to time in
accordance with the above table and notify the Company and the Banks of such
determination from time to time. In the event the S&P Rating and the Moody's
Rating correspond to different levels on the above table resulting in different
Commitment Fee determinations, the following provisions shall apply. In the
event the S&P Rating and the Moody's Rating differ by one level, the Commitment
Fee shall be that corresponding to the higher Rating. For example, a "BBB+" S&P
Rating and a "Baa2" Moody's Rating would result in a Commitment Fee percentage
equal to 0.10%. In the event the S&P Rating and the Moody's Rating differ by two
levels, the Commitment Fee shall be that corresponding to that level which is in
between the two applicable levels. For example, a "BBB" S&P Rating and a "Ba1"
Moody's Rating would result in a Commitment Fee percentage equal to 0.125%. In
the event the S&P Rating and the Moody's Rating differ by three levels, the
Commitment Fee shall be that corresponding to the level immediately above the
lower of such Ratings. For example, a "BBB+" S&P Rating and a "Ba1" Moody's
Rating would result in a Commitment Fee percentage equal to 0.125%. In the event
the S&P Rating and the Moody's Rating differ by four levels (i.e. a ratings
split between level 1 and level 5), then the Commitment Fee shall be that
corresponding to
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level 4. For example a "BBB+" S&P Rating and a "Ba2" Moody's Rating would result
in a Commitment Fee percentage equal to 0.15%.
In the event only one rating agency exists or continues rating the
Company's long term senior unsecured debt, such agency's rating shall be used
for purposes of the above table. In the event: (i) neither agency exists or
continues rating the Company's long term senior unsecured debt or (ii) the
Company no longer has any outstanding long term senior unsecured debt to be
rated, the Commitment Fee for the first 90 days after such occurrence shall be
the Commitment Fee in effect as determined using the above immediately prior to
such occurrence. During such 90-day period, the Agent Bank and the Company shall
negotiate in good faith to agree upon a new pricing grid or other appropriate
pricing terms. Any such new grid or pricing terms shall be approved by the
Majority Banks. In the event the Agent Bank, the Company and Majority Banks
cannot agree upon such new pricing grid or pricing terms by the end of such
90-day period, the Commitment Fee shall be that corresponding to level 3 of the
above table for the remainder of the term of this Agreement.
Any necessary adjustment in the Commitment Fee pursuant to the terms
hereof shall become effective immediately upon any change in a Rating.
SECTION 3.12. TERMINATION OF CREDIT FACILITY.
Unless earlier terminated pursuant to the terms hereof, the Commitments
of the Banks, and the Credit Facility, shall terminate on the Termination Date.
Accordingly, the Company shall pay the entire outstanding principal amount of,
and all accrued but unpaid interest on, the Loans and Notes, together with any
and all other amounts owing by the Company to the Bank, the Letter of Credit
Banks and the Agent Bank hereunder or under the Notes, on the Termination Date.
SECTION 3.13. OPTIONAL REDUCTION OF COMMITMENTS.
The Company shall have the right at any time or from time to time upon
not less than two Business Days' prior written notice to the Agent Bank to
reduce the Total Commitments of the Banks, in whole or in part, provided that
each partial reduction shall be in an aggregate amount of not less than
$25,000,000 and an integral multiple of $5,000,000, and shall reduce the
respective Commitments of all the Banks proportionately; provided, however, that
the Company shall not reduce the Total Commitments of the Banks to an amount
which is less than the aggregate of (i) the aggregate principal amount of all
Eurodollar Rate Loans and Competitive Bid Loans having Interest Periods ending
after the effective date of the reduction plus (ii) the Stated Amount of all
Letters of Credit with an expiration date after the effective date of the
reduction; and further, provided, that in no event shall the Total Commitments
of the Banks be reduced to an amount less than $400,000,000, unless the Total
Commitments of the Banks are terminated in full. The Agent Bank shall give
prompt written notice to each Bank of each such reduction. Upon any optional
reduction of the Total Commitments of the Banks, the Company shall prepay such
amount of each Bank's outstanding Loans, if
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any, as may be necessary so that after such prepayment the sum of the aggregate
unpaid principal amount of such Bank's Loans, such Bank's pro rata share of
unpaid Reimbursement Obligations, and such Bank's liability in respect of all
outstanding Letters of Credit does not exceed the amount of such Bank's
Commitment as then reduced. Once the Company voluntarily reduces the Commitments
pursuant to this Section 3.13., the Company may not thereafter increase the
Commitments pursuant to Section 2.3. or otherwise.
SECTION 3.14. SUBSTITUTION OF BANKS.
3.14.1.
If any Bank shall default in the performance of its Commitment, whether
in whole or in part, then:
(a) such default shall not relieve any other Bank of its Commitment;
and
(b) the Company may, with the prior written approval of the Agent Bank
(such approval not to be unreasonably withheld), terminate the Commitment of
such defaulting Bank and arrange for the Commitment of the defaulting Bank to be
taken over by one or more of the other Banks, and to the extent that such other
Banks will not take over such Commitment, arrange for its assumption by one or
more banks which are not at that time parties hereto, each of which banks shall,
except as otherwise provided herein upon execution and delivery to the Company
of a counterpart hereof, become a Bank hereto to the extent of the Commitment
taken over by it; and
(c) the defaulting Bank shall immediately refund to the Company that
portion of all Commitment Fees which have been paid to it by the Company with
respect to the amount of its Commitment not made available to the Company and
shall be liable to the Company for any and all additional costs and expenses
incurred by the Company in connection with arranging, obtaining and funding any
substitute loan or loans and/or substitute commitment or commitments; provided,
however, that neither the payments by a defaulting Bank required by this
subsection, nor any action of the Company pursuant to this Section 3.14., nor
the prepayment of Notes pursuant to Section 3.14.2 hereof shall constitute a
waiver of or release of any right which the Company shall have against the
defaulting Bank for its failure to perform its obligations hereunder.
3.14.2.
Loans previously made hereunder by a defaulting or withdrawing Bank, or
any portion thereof, which are included in the Commitment taken over by any
other Bank or Banks or by a bank or banks not then parties hereto, shall be
prepaid by the Company without penalty or premium but subject to offset of the
amounts due from such withdrawing Bank pursuant to Section 3.14.1(c).
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3.14.3.
From time to time, the Company may replace a non-defaulting Bank (the
"Replaced Bank") with another financial institution (or institutions) desiring
to be a Bank hereunder (the "New Bank(s)") and/or with one or more Banks already
a party hereto ("Existing Bank(s)") so long as (a) the Replaced Bank consents in
writing to such replacement and receives all amounts owing to such Replaced Bank
hereunder on the effective date of such replacement, (b) the New Bank(s) and/or
Existing Bank(s), as the case may be, assume(s) all of the obligations of a Bank
hereunder having a Commitment equal to the Replaced Bank's by executing, in the
case of a New Bank(s), a letter agreement in substantially the form of Exhibit
C-1 attached hereto or, in the case of an Existing Bank(s), a letter agreement
in substantially the form of Exhibit C-2 hereto, (c) the Commitment(s) of the
New Bank(s), together with the additional Commitment(s) of the Existing Bank(s)
assumed by the Existing Bank(s) pursuant hereto, is equal to the Commitment of
the Replaced Bank and (d) the Company and the Agent Bank acknowledge and consent
that the New Bank(s) shall become a Bank hereunder (and/or that the Existing
Bank(s) shall have an additional Commitment hereunder equal to that of the
Replaced Bank) by signing the respective acknowledgments contained in the
appropriate letter agreement referred to in subparagraph (c) above.
3.14.4.
Upon the increase in any Bank's Commitment or any bank or banks
becoming a party to this Agreement as herein provided, the Company shall
immediately furnish to all Banks which are then parties hereto notice of (a) the
increased Commitment of such Bank, or (b) the names and addresses of such bank
or banks together with the amount of the Commitment of each such bank or banks.
3.14.5.
The respective amounts of the Commitments under Section 2.2. hereof
shall be adjusted from time to time to reflect any changes made pursuant to this
Section 3.14. and notice of such adjustments shall be given by the Company at
the time thereof to each Bank or bank then a party hereto. Such adjusted amounts
of Commitments shall thereupon become the basis for pro rata treatment under
Section 3.8. of this Agreement.
3.14.6.
Upon the termination in whole of the Commitment of any Bank or any bank
which has become a party hereto, and the prepayment of all Loans previously made
under such Commitment, all as provided in this Section 3.14., such Bank or bank
shall cease to be a party to this Agreement except as otherwise provided herein.
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SECTION 3.15. CAPITAL REQUIREMENTS.
If, as a result of the adoption after the date of this Agreement, of
any applicable law, rule or regulation affecting capital adequacy or capital
maintenance, or any change after the date of this Agreement in the
interpretation or administration of any law, rule or regulation affecting
capital adequacy or capital maintenance in existence as of the date hereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such Bank with any
request or directive affecting capital adequacy or capital maintenance (whether
or not having the force of law) of any such authority, central bank or
comparable agency, any Bank determines that such adoption, change or compliance
has or would have the effect of reducing the rate of return on such Bank's
capital as a consequence of its Commitment or Loans or its commitment to issue,
participate in or maintain Letters of Credit to a level below that which such
Bank could have achieved but for such adoption, change or compliance (taking
into consideration such Bank's policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, such Bank shall give prompt notice to
the Company and the Agent Bank, and then from time to time, within 15 days after
submission by such Bank to the Company (with a copy to the Agent Bank) of a
written request therefor, the Company shall pay to such Bank such additional
amount or amounts as will compensate such Bank for such reduction. Any request
submitted by a Bank to the Company pursuant to this Section 3.15. shall contain
such calculations of the amounts requested therein as such Bank shall deem
reasonable in view of its customary practices, and shall be submitted as soon as
practicable, but in any event the initial such request shall be submitted not
more than 90 days after such Bank becomes aware of the event by reason of which
such request is being submitted. Subsequent requests by such Bank shall be
submitted quarterly. If any Bank requests payment of any amount from the Company
pursuant to this Section 3.15., the Company may, pursuant to arrangements and
documentation satisfactory to the Company and the Agent Bank, prepay the
outstanding Loans, fees, and any other amounts due to such Bank in full and
terminate the Commitment of such Bank and the Company may at its option arrange
for all or part of the Commitment of such Bank to be taken over by one or more
of the other Banks and, to the extent such other Banks do not take over such
Commitment or part thereof, arrange for it to be taken over in whole or in part
by a bank or banks not a party hereto, each of which banks shall, except as
otherwise provided herein upon execution and delivery to the Company of a
counterpart hereof, become a full party hereto to the extent of the Commitment
taken over by it. Upon any bank or banks becoming a party to this Agreement as
herein provided, the Company shall immediately furnish to all Banks which are
then parties hereto the names and addresses of such bank or banks together with
the amount of the Commitment of each such bank or banks. The respective amounts
of the Commitments under Section 2.2. hereof shall be adjusted from time to time
to reflect any changes made pursuant to this Section 3.15. and notice of such
adjustments shall be given by the Company at the time thereof to each Bank or
bank then a party hereto. Such adjusted amounts of Commitments shall thereupon
become the basis for pro rata treatment under Section 3.8. of this Agreement.
Upon the termination in whole of the Commitment of any Bank or any bank which
has become a party hereto, and the
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prepayment of all Loans previously made under such Commitment, all as provided
in this Section 3.15., such Bank or bank shall cease to be a party to this
Agreement except as otherwise provided herein.
SECTION 3.16. MANDATORY TERMINATION OF COMMITMENTS UPON CHANGE IN CONTROL.
In the event that (i) any Person or two or more Persons acting in
concert shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities and
Exchange Act of 1934), directly or indirectly, of securities of the Company (or
other securities convertible into such securities) representing fifty percent
(50%) or more of the combined voting power of all securities of the Company
entitled to vote in the election of directors, other than securities having such
power only by reason of the happening of a contingency, or (ii) during any
period of up to twelve (12) consecutive months, commencing before or after the
date of this Agreement, individuals who at the beginning of such twelve (12)
month period were directors of the Company shall cease for any reason (other
than death, mental or physical disability, or retirement) to constitute a
majority of the board of directors of the Company, then: (a) the Commitments of
the Banks to the Company hereunder shall be immediately terminated, (b) any
amounts outstanding under the Notes or under this Agreement shall,
notwithstanding any other provisions of this Agreement or the Notes, become
immediately due and payable, and (c) the Company shall immediately deposit as
cash collateral, with the Agent Bank, an amount equal to the Stated Amount of
all outstanding Letters of Credit.
SECTION 3.17. AGENT FEES.
The Company agrees to pay to the Agent Bank a fee to compensate the
Agent Bank for the administration of the Credit Facility, including a fee for
the administration of requests and offers to make Competitive Bid Loans, and for
other services, such fee to be agreed upon by the Agent Bank and the Company.
SECTION 3.18. EXTENSION OF TERM OF CREDIT FACILITY.
The Company may request up to two successive one (1) year extensions of
the Termination Date. The Company shall deliver the initial request for
extension to the Agent Bank at least ninety days prior to the first anniversary
of the Effective Date and, in the case of the request for the second extension,
at least ninety days prior to the second anniversary of the Effective Date (each
such request for an extension, an "Extension Request"). The Agent Bank shall
immediately forward each Extension Request to the Banks. Each Bank shall have
the right, as to its Commitment, in its sole and absolute discretion, to approve
or disapprove the requested extension of the Credit Facility. Each Bank shall,
within forty-five days after the receipt by the Agent Bank of any Extension
Request, notify the Agent Bank whether such Bank shall extend its Commitment to
the requested extended Termination Date. In the event that not all of the Banks
approve the applicable Extension Request, the Credit Facility shall terminate on
the then current Termination Date and all Loans, and all accrued but unpaid
interest thereon and all other
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amounts owing by the Company to the Banks and the Agent Bank hereunder, shall be
due and payable on the then current Termination Date. However, and
notwithstanding the foregoing, in the event Banks having Commitments aggregating
$400,000,000 or more approve the applicable Extension Request (such Banks so
approving the Extension Request referred to herein as the "Approving Banks") and
one such Approving Bank is the Agent Bank, the Credit Facility and the
obligation to make Loans thereunder, solely as to the Approving Banks, shall
continue and shall remain in full force and effect on the same terms and
conditions of this Agreement. The Credit Facility as so extended as to the
Approving Banks shall become effective on the first day after the Termination
Date that would have then occurred but for an extension thereof as contemplated
by this Section 3.18. Further, any reference to "Commitments" and to "Total
Commitment of the Banks" as it relates to the Credit Facility as extended
pursuant to this Section 3.18., shall refer only to the Commitments of the
Approving Banks. In no event shall a Bank that is not an Approving Bank (a
"Terminating Bank") be obligated to participate in the Credit Facility as so
extended and the Company shall pay, on the Termination Date that would have then
occurred but for an extension thereof as contemplated by this Section 3.18., all
Loans made by a Terminating Bank, and all accrued interest thereon, and all
other amounts owing to such Terminating Bank hereunder.
ARTICLE 4. LETTER OF CREDIT FACILITY
SECTION 4.1. LETTERS OF CREDIT.
(a) Subject to the terms and conditions of this Agreement, the Letter
of Credit Banks, on behalf of the Banks, agree to issue and amend (including
without limitation, to extend or renew) for the account of the Company one or
more standby letters of credit (which may be direct pay letters of credit)
(individually, a "Letter of Credit" and collectively, the "Letters of Credit"),
in such form as may be requested from time to time by the Company and agreed to
by the applicable Letter of Credit Bank, from and including the Effective Date
to the Termination Date, up to a maximum aggregate Stated Amount at any one time
outstanding equal to the L/C Commitment Amount; provided, however, that the
Stated Amount of any Letter of Credit issued pursuant to this Section 4.1. shall
not exceed the Available Commitment at the time of such issuance; and further,
provided, that the expiration date of any Letter of Credit shall not extend
beyond the Termination Date. A request for a Letter of Credit shall be pursuant
to a letter of credit application form in form and substance satisfactory to the
applicable Letter of Credit Bank.
(b) Each Bank severally agrees that it shall be absolutely,
unconditionally and irrevocably liable, without regard to the occurrence of any
Default or Event of Default or any condition precedent whatsoever, to the extent
of such Bank's pro rata share of the Total Commitments of the Banks, to
reimburse each Letter of Credit Bank for the amount of each Drawing paid by such
Letter of Credit Bank under each Letter of Credit issued by such Letter of
Credit Bank to the extent such amount is not reimbursed by the Company pursuant
to Section 4.4. hereof. Each Bank's obligation to reimburse the applicable
Letter of Credit Bank pursuant to this Section 4.1.(b) shall not be affected by
any circumstance,
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including, without limitation, (i) any set-off, counterclaim, recoupment,
defense or other right which such Bank may have against a Letter of Credit Bank,
the Company, any direct or indirect beneficiary of any Letter of Credit, the
Agent Bank or any other Person whatsoever; (ii) the occurrence or continuance of
a Default or an Event of Default; (iii) any adverse change in the condition
(financial or otherwise) of the Company; (iv) any breach of this Agreement by
the Company, the Agent Bank or any other Bank; or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing;
provided, however, that the Banks shall not be obligated to reimburse a Letter
of Credit Bank pursuant to this Section 4.1.(b) with respect to a Letter of
Credit if (i) such Letter of Credit Bank has made payment pursuant to a Drawing
with respect to such Letter of Credit and the making of such payment constituted
gross negligence or willful misconduct on the part of such Letter of Credit Bank
or (ii) a Letter of Credit Bank issues such Letter of Credit after an Event of
Default has been declared by any Bank or the Majority Banks pursuant to Article
9. hereof and written notice thereof has been received by such Letter of Credit
Bank or after an Event of Default specified in Section 9.1.(c) hereof has
occurred. Each Bank's obligation to reimburse a Letter of Credit Bank shall
continue to be effective, or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any Reimbursement Obligation of the Company is
rescinded or must otherwise be restored or returned by such Letter of Credit
Bank upon the insolvency, bankruptcy, dissolution, liquidation or reorganization
of the Company or upon or as a result of the appointment of a receiver,
intervenor or conservator of, or trustee or similar officer for, the Company or
any substantial part of its property, or otherwise, all as though such payment
had not been made. Upon receipt of a notice of its obligation to reimburse a
Letter of Credit Bank prior to 11:00 a.m. on a Business Day, a Bank shall make
such reimbursement on such Business Day; if such notice is received after 11:00
a.m., reimbursement shall be due on the next Business Day. The failure of any
Bank to honor its obligations hereunder shall not relieve any other Bank of its
duty to honor its obligations hereunder. Upon the written request of a Bank, a
Letter of Credit Bank shall deliver to such Bank a copy of any Letter of Credit
and copies of all material documents delivered to such Letter of Credit Bank in
connection with any Drawing with respect to such Letter of Credit.
(c) Each payment made by a Bank to a Letter of Credit Bank pursuant to
paragraph (b) above shall be treated as the purchase by such Bank of a
participating interest in the Company's Reimbursement Obligation under Section
4.4. hereof in an amount equal to such payment. Each Bank, so long as it has
made the payment required to be made by it pursuant to Section 4.1.(b) hereof,
shall share in accordance with its pro rata share of the Total Commitments of
the Banks in any interest which accrues pursuant to Section 4.4.(b) hereof. All
amounts recovered by the Agent Bank hereunder or under the Notes and which are
applied by the Agent Bank to the Reimbursement Obligations of the Company under
Section 4.4. hereof shall be distributed by the Agent Bank to the Banks who have
made the payments required to be made by them pursuant to Section 4.1.(b) hereof
pro rata in accordance with their respective share of the Total Commitments of
the Banks.
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(d) If and to the extent that any Bank shall fail to make available to
a Letter of Credit Bank the amount required to be paid by such Bank pursuant to
Section 4.1.(b) hereof, such Letter of Credit Bank shall be subrogated to the
rights of such Bank under this Agreement to the extent of such failure and shall
thereafter (until such Bank shall make such amount available to such Letter of
Credit Bank) be entitled to receive all amounts owing by such Bank hereunder and
to the percentage of voting rights of such Bank under this Agreement equal to
the percentage the amount such Bank failed to pay bears to the aggregate Stated
Amount of all outstanding Letters of Credit issued by such Letter of Credit Bank
and the aggregate unpaid principal of all outstanding Syndicated Loans at such
time. If any Bank fails to reimburse a Letter of Credit Bank as provided in
Section 4.1.(b) hereof, such unreimbursed amount shall bear interest from the
date due until paid at the applicable overnight federal funds rate.
SECTION 4.2. METHOD OF ISSUANCE OF LETTERS OF CREDIT.
(a) Notice of Issuance. The Company shall give the Agent Bank written
notice or telephonic notice confirmed in writing at least three Business Days
prior to the requested date of issuance of a Letter of Credit, and the Agent
Bank shall give immediate notice thereof to the applicable Letter of Credit
Bank.
(b) Issuance. Provided the Company has given the notice prescribed by
Section 4.2.(a) and subject to the other terms and conditions of this Agreement,
the applicable Letter of Credit Bank shall issue the requested Letter of Credit
on the date of issuance on behalf of the Banks for the benefit of the stipulated
beneficiary and shall deliver the original of such Letter of Credit to the
beneficiary at the address specified in the Company's notice. At the request of
the Company, the applicable Letter of Credit Bank shall deliver a copy of each
Letter of Credit to the Company within a reasonable time after the date of
issuance thereof. Upon the written request of the Company, the applicable Letter
of Credit Bank shall deliver to the Company a copy of any Letter of Credit
proposed to be issued hereunder prior to the issuance thereof.
(c) Reporting to Banks. The Agent Bank shall report to the Banks on a
quarterly basis the aggregate Stated Amount of all Letters of Credit then
outstanding and such other information concerning the Letters of Credit as a
Bank shall reasonably request. The Agent Bank shall promptly deliver to each
Bank copies of any Letter of Credit issued hereunder or any amendment thereto.
Other than as set forth in this paragraph (c), the Agent Bank shall have no duty
to notify the Banks regarding the issuance or other matters regarding Letters of
Credit issued hereunder. The failure of the Agent Bank to perform its
requirements under this paragraph (c) shall not relieve the Banks' reimbursement
obligations under Section 4.1.(b) hereof.
SECTION 4.3. LETTER OF CREDIT FEES.
(a) The Company hereby agrees to pay to the Agent Bank, for the account
of the Banks, to be distributed to the Banks pro rata in accordance with their
respective Commitments, a letter of credit fee on the Stated Amount of each
outstanding Letter of
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Credit at a per annum rate equal to the Applicable Margin for Eurodollar Rate
Loans in effect from time to time (as calculated in accordance with the
definition thereof), such fee to be calculated on the Stated Amount from the
date of issuance to the earlier of the date of expiration or of the final
Drawing with respect to such Letter of Credit, based on a year of 360 days and
an actual day month, and payable quarterly in arrears on the last day of each
March, June, September and December during the term of this Agreement and on the
Termination Date.
(b) In addition to the fees set forth in (a) above, the Company shall
pay to (x) the Agent Bank for the account of each Letter of Credit Bank (i) a
fronting fee on the Stated Amount of each Letter of Credit issued by such Letter
of Credit Bank at a per annum rate of 0.125%, such fee to be calculated on the
Stated Amount from the date of issuance to the earlier of (x) the date of
expiration or termination of such Letter of Credit or (y) the date of the final
Drawing with respect to such Letter of Credit, based on a year of 360 days and
an actual day month, and payable quarterly in arrears on the last day of each
March, June, September and December during the term of this Agreement and on the
expiration date or date of final Drawing of each such Letter of Credit, and (ii)
all out-of-pocket fees and disbursements incurred by such Letter of Credit Bank
in connection with the issuance or amendment of a Letter of Credit and any
administrative fee normally charged by the International Department of such
Letter of Credit Bank in connection with the issuance or amendment by such
department of letters of credit, and (y) each Letter of Credit Bank such other
fees as may be agreed to by the Company and such Letter of Credit Bank from time
to time.
SECTION 4.4. LETTER OF CREDIT REIMBURSEMENT.
(a) Notice of Drawing. The applicable Letter of Credit Bank shall
promptly notify the Company, the Agent Bank and each Bank by telephone,
telecopy, telex or other telecommunication of any Drawing under a Letter of
Credit it has issued and of the anticipated payment date. On the payment date,
the Letter of Credit Bank shall confirm to the Company, the Agent Bank and each
Bank by telephone or telecopy that payment of the Drawing is to be made by the
Letter of Credit Bank on such date.
(b) Payments. The Company hereby agrees absolutely and unconditionally
to pay to the Agent Bank on behalf of the applicable Letter of Credit Bank, in
the manner provided in Section 4.4.(c):
(i) On each date a Drawing is paid, an amount equal to
the amount paid by such Letter of Credit Bank under any Letter of
Credit plus associated fees and charges; and
(ii) If any Drawing shall be reimbursed to the Agent Bank
after 2:00 p.m. (Atlanta time) on the payment date, interest on any and
all amounts required to be paid pursuant to clause (i) of this Section
4.4.(b) from and after the due date
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thereof until payment in full, payable on demand, at an annual rate of
interest equal to the Base Rate.
(c) Method of Reimbursement. The Company shall reimburse the Agent Bank
(which shall immediately forward such funds, in the form received, to the
applicable Letter of Credit Bank) for each Drawing under any Letter of Credit in
the following manner:
(i) the Company shall immediately reimburse the Agent
Bank in accordance with Section 3.6. hereof; or
(ii) (A) if the Company has not reimbursed the Agent Bank
pursuant to subparagraph (i) above and (B) the conditions set forth in
Section 5.2. hereof have been fulfilled and (C) sufficient funds are
available within the limits of the amount of Loans that may be borrowed
as provided in Article 2. hereof, with the proceeds of a Loan; or
(iii) the Agent Bank may debit any deposit account of the
Company maintained with the Agent Bank and appropriate and apply an
amount of funds in such account equal to the Reimbursement Obligations
outstanding at such time in satisfaction of the Company's obligations
set forth in subparagraph (i) above.
(d) Syndicated Loans to Fund Drawings. Upon any Drawing, the Agent Bank
shall notify the Banks if the Company has elected to reimburse the applicable
Letter of Credit Bank using the proceeds of Syndicated Loans. Upon receipt of
such notice and if the conditions set forth in subparagraph (c)(ii) above have
been satisfied, each Bank agrees to deliver to the Agent Bank its pro rata share
of the amount of Syndicated Loans necessary to reimburse such Letter of Credit
Bank for any payment made by such Letter of Credit Bank pursuant to such Drawing
not later than one Business Day after receipt of such notice. Any funds
delivered to the Agent Bank under this paragraph (d) shall be delivered in the
manner set forth in the fourth sentence of Section 3.2. hereof. The parties
agree that the notice provisions for making Syndicated Loans as provided in
Section 3.2. hereof shall apply to the making of Syndicated Loans as
contemplated by this paragraph (d).
(e) Obligations Absolute. The obligations of the Company under this
Article 4. (and, if applicable in the event of the failure of the Company to so
reimburse a Letter of Credit Bank, the obligations of the Banks under this
Article 4.) shall be absolute, unconditional and irrevocable, and shall be
performed strictly in accordance with the terms of this Agreement, under all
circumstances whatsoever, including, without limitation, the following
circumstances:
(i) any lack of validity or enforceability of all or any
of this Agreement, the Notes, the letter of credit applications and
other related documents and any other agreements relating to the
Letters of Credit (the "Related Documents");
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(ii) any amendment or waiver of or any consent to or
departure from the terms of the Related Documents;
(iii) the existence of any claim, set-off, defense or other
rights which the Company may have at any time against any direct or
indirect beneficiary of any Letter of Credit, any Bank, the Agent Bank
or any other Person, whether in connection with the Related Documents
or any unrelated transaction;
(iv) any statement or any other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect whatsoever;
(v) payment by the applicable Letter of Credit Bank under
any Letter of Credit against presentation of a sight draft or
certificate which does not comply with the terms of such Letter of
Credit, provided that such payment shall not have constituted gross
negligence or willful misconduct of such Letter of Credit Bank; and
(vi) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, provided that such
other circumstance or happening shall not have been the result of gross
negligence or willful misconduct of the applicable Letter of Credit
Bank.
SECTION 4.5. LETTER OF CREDIT BANKS.
(a) Liability of Letter of Credit Banks to Other Banks. No Letter of
Credit Bank shall be liable to any Bank or to any other participant in the
Letters of Credit for any error in judgment or for any action taken or omitted
to be taken by such Letter of Credit Bank except for actions of such Letter of
Credit Bank constituting gross negligence or willful misconduct.
(b) Liability of the Letter of Credit Banks to Company/Banks. The
Company assumes all risks of the acts or omissions of any beneficiary of any
Letter of Credit with respect to its use of such Letter of Credit. Neither any
Letter of Credit Bank nor any of its officers or directors shall be liable or
responsible to the Company or the Banks for:
(i) the use which may be made of any Letter of Credit or
for any acts or omissions of any beneficiary in connection therewith;
(ii) the validity, sufficiency or genuineness of documents
presented under any Letter of Credit even if such documents should in
fact prove to be in any or all respects invalid, insufficient,
fraudulent or forged;
(iii) payment by the applicable Letter of Credit Bank
against presentation of documents which do not comply with the terms of
the Letter of
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Credit, including failure of any documents to bear any reference or
adequate reference to the Letter of Credit; or
(iv) any other circumstances whatsoever in making or
failing to make payment under any Letter of Credit;
except only that the Company (and, if applicable, the Banks) shall have a claim
against the applicable Letter of Credit Bank to the extent, but only to the
extent, of any direct, as opposed to consequential, damages suffered by the
Company which were caused by (i) the applicable Letter of Credit Bank's willful
misconduct or gross negligence in determining whether documents presented under
any Letter of Credit comply with the terms of such Letter of Credit or (ii) the
applicable Letter of Credit Bank's willful misconduct or gross negligence in
failing to pay under any Letter of Credit after the presentation to it by the
beneficiary of such Letter of Credit of a sight draft and certificate strictly
complying with the terms and conditions of such Letter of Credit.
ARTICLE 5. CONDITIONS TO EFFECTIVENESS OF AGREEMENT, FOR
BORROWINGS AND ISSUANCE OF LETTERS OF CREDIT
SECTION 5.1. EFFECTIVENESS, INITIAL BORROWING AND ISSUANCE OF LETTERS OF CREDIT.
This Agreement shall not become effective, the Banks shall not be
obligated to make the initial Loans and the applicable Letter of Credit Bank
shall not be obligated to issue the initial Letter of Credit hereunder until the
Company shall have furnished to the Agent Bank the following, each dated (unless
otherwise indicated) the date of this Agreement, in form and substance
satisfactory to the Agent Bank:
(a) The Notes, payable to the order of each of the Banks in the amounts
of their respective Commitments, duly executed and delivered by the Company; and
(b) An Officer's Certificate stating that: (i) the representations and
warranties contained in Article 6. hereof are true on and as of such date,
except to the extent of changes caused by the transactions herein contemplated;
and (ii) the Company has received a certificate of independent certified public
accountants of national standing selected by the Company, stating that such
accountants have reviewed the federal income tax returns of the Company for the
fiscal years ended June 30, 1988 to 1996, inclusive, and the provisions for
payment of federal income taxes for such fiscal years, as reflected in the
financial statements of the Company certified by an independent certified public
accountant for those years, and that in the opinion of such certifying
accountants either such returns properly reflect the Company's federal income
taxes for the periods covered thereby or the Company has paid, or made adequate
provision for the payment of, all federal income taxes for such fiscal years;
and
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(c) An incumbency certificate for the Chairman of the Board, the
President, the principal financial officers, and other persons who will sign the
Notes pursuant to this Agreement on behalf of the Company; and
(d) A copy of the Company's Board of Directors' resolutions authorizing
the borrowings under this Agreement, certified by the Secretary or an Assistant
Secretary of the Company as being in full force and effect as of the date of the
Effective Date; and
(e) a favorable opinion from counsel for the Company stating that:
(i) The Company is a corporation duly organized, existing
and in good standing under the laws of the State of Delaware, and the
execution, delivery and performance of this Agreement and the Notes are
within the Company's corporate powers;
(ii) The Company has the necessary corporate power to
carry on its business as then being conducted;
(iii) The Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which the nature of the business conducted by it makes
such qualification necessary;
(iv) The Company is a duly certificated air carrier and
there are in force all permanent or temporary certificates or other
appropriate legal authority issued by appropriate governmental
authorities to authorize the Company to engage in intrastate,
interstate, overseas and foreign air transportation of persons,
property and mail over the routes then operated by the Company;
(v) The Company has title to all of the flight equipment
which it owns free and clear of all liens and encumbrances except as
permitted by this Agreement;
(vi) All leases of flight equipment to which the Company
is a party are valid and binding upon the lessors;
(vii) No consent of stockholders of the Company to the
chattel mortgage or mortgages referred to in Section 7.6. hereof is
required by law or by the Certificate of Incorporation or Bylaws of the
Company or otherwise;
(viii) All corporate steps necessary to authorize the
execution and delivery of this Agreement and the Notes and the
Company's performance thereunder have been taken and no consent,
approval, authorization, permit or license from any federal, state or
other regulatory authority is required in connection therewith;
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(ix) The borrowings hereunder, or the giving of the Notes,
will not violate any provision of the Delaware Corporation Law or the
Company's Certificate of Incorporation or Bylaws or any agreement,
indenture, note or other instrument evidencing any material
indebtedness for money borrowed to which the Company is a party or by
which the Company or its assets is bound; and
(x) This Agreement and the Notes being issued to evidence
such borrowings are legal, valid and binding obligations of the Company
enforceable in accordance with their respective terms, subject,
however, to limitations imposed by law in connection with bankruptcy
and similar proceedings.
(f) A letter in the form of Exhibit G attached hereto duly executed by
the Company.
SECTION 5.2. ALL BORROWINGS.
The Banks shall not be obligated to make any advance under the Notes,
including the initial advance, and any Letter of Credit Bank shall not be
obligated to issue any Letter of Credit, including the initial Letter of Credit,
unless at the time thereof the Company shall have furnished to the Agent Bank an
Officer's Certificate bearing that date, and stating that:
(a) There exists on that date no Default or Event of Default;
(b) There exists on that date no Event of Default or default under any
instrument evidencing or any agreement given in connection with Funded Debt of
the Company;
(c) Such borrowing or issuance of such Letter of Credit will not
contravene any agreement, indenture or instrument to which the Company is a
party or by which it may be bound and which is material to the financial
condition of the Company; and
(d) The representations and warranties contained in Sections 6.1.,
6.3., 6.4., 6.7.(a), 6.7.(c), 6.8., 6.9., 6.10., 6.11., 6.13., and 6.14. hereof
are true on and as of such date, except to the extent of changes caused by the
transactions herein contemplated.
(e) The extension(s) of credit being made on such date are legal, valid
and binding obligations of the Company, the resolutions of the Board of
Directors of the Company referred to in Section 5.1.(d) hereof remain in full
force and effect, and the officers of the Company requesting such advances are
duly authorized and empowered to do so.
Further, any conversion of a Syndicated Loan from one type to another
as contemplated by Section 3.9. hereof shall be deemed to be a representation by
the
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Company that the matters referred to in paragraphs (a) through (e) above
continue to be true and correct.
ARTICLE 6. REPRESENTATIONS AND WARRANTIES
The Company hereby represents, covenants and warrants to the Agent
Bank, the Letter of Credit Banks and each of the Banks as follows:
SECTION 6.1. ORGANIZATION; STANDING, ETC.
The Company is a corporation duly organized and existing under the laws
of the State of Delaware, has the corporate power to own its property and carry
on its business as being conducted, and is duly qualified to do business as a
foreign corporation and is in good standing in every jurisdiction in which the
nature of the business conducted by it makes such qualification necessary.
SECTION 6.2. FINANCIAL STATEMENTS.
The Company has furnished the Banks with the following financial
statements, identified by the certificate of a principal financial officer of
the Company: balance sheets of the Company as at June 30, 1995 and June 30,
1996, and income and reinvested earnings statements of the Company for the years
ended on such dates, respectively, all certified by Arthur Andersen LLP. Such
financial statements are true and correct and have been prepared in accordance
with generally accepted accounting principles consistently followed throughout
the periods involved. The balance sheets and their accompanying notes present
fairly the condition of the Company as of the dates thereof, and the income and
reinvested earnings statements present fairly the results of the operations of
the Company for the periods indicated. There has been no material adverse change
in the condition or operation of the Company since December 31, 1996.
SECTION 6.3. LITIGATION.
There is no action or proceeding pending or threatened against the
Company before any court or administrative agency which, in the reasonable
opinion of the Company, is likely to be determined in a manner which would
result in any material adverse change in the condition or operation of the
Company and the Company is not in default with respect to any order, writ,
injunction or decree of any court or administrative agency, which would have a
material adverse effect on the Company.
SECTION 6.4. BUSINESS; STATUS AS AIR CARRIER.
(a) The Company is a duly certificated air carrier and there are in
force any certificates or other appropriate authority issued by appropriate
governmental authorities necessary to authorize the Company to engage in
intrastate, interstate, overseas and
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foreign air transportation of persons, property and mail over the routes
operated by the Company; and
(b) no proceedings are pending or threatened, by or before any public
body, agency or authority, domestic or foreign, including but not limited to
proceedings to alter, amend, modify, suspend or revoke such certificates in
whole or in part, which might seriously affect adversely the income from, title
to, or possession of, any of the properties of the Company, to an extent which
would constitute a material adverse change in the business or condition of the
Company.
SECTION 6.5. FUNDED DEBT.
The Company does not have outstanding any Funded Debt except as set
forth on Schedule I to this Agreement; and there exists no default under the
provisions of any instrument evidencing such indebtedness or agreement relating
thereto.
SECTION 6.6. TITLE TO PROPERTIES, ETC.
The Company and its Subsidiaries have good and marketable title to
their properties and assets, including the properties and assets reflected in
the balance sheets described in Section 6.2. hereof, subject to no mortgage,
pledge, encumbrance, lien or charge of any kind except mortgages, pledges,
encumbrances, liens or charges permitted by Section 8.1. hereof.
SECTION 6.7. TAX RETURNS AND PAYMENTS.
(a) The Company has filed all federal income tax returns which are
required to be filed, and has paid all taxes as shown on said returns and on all
assessments received by it to the extent that such taxes (other than those which
the Company is contesting in good faith by appropriate proceedings being
diligently conducted) have become due;
(b) The federal income tax liability of the Company has been finally
determined by the Internal Revenue Service and satisfied for all fiscal years
prior to and including the fiscal year ended June 30, 1992, except for a pending
refund claim filed by the Company with the Internal Revenue Service with respect
to the fiscal year ended June 30, 1984;
(c) All other tax returns and reports of the Company which are required
to be filed have been duly filed, and all taxes and government charges (other
than those for which payment may be withheld without penalty or those which the
Company is contesting in good faith by appropriate proceedings being diligently
conducted) upon the Company, its assets, income or franchises which are due and
payable have been paid.
SECTION 6.8. COMPLIANCE WITH OTHER INSTRUMENTS.
The Company is not a party to any contract or agreement or subject to
any charter or other corporate restriction which materially and adversely
affects its business, property
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or assets, or financial condition; neither the execution nor delivery of this
Agreement nor the Notes herein described, nor fulfillment of nor compliance with
the terms and provisions hereof and of the Notes will conflict with, or result
in a breach of the terms, conditions or provisions of, or constitute a default
under, the Certificate of Incorporation or Bylaws of the Company or of any
agreement or instrument to which the Company is now a party, which breach would
have a material adverse effect on the condition or operation of the Company.
SECTION 6.9. OFFERING OF NOTES.
Neither the Company nor any agent acting on its behalf has offered the
Notes to be issued hereunder for sale to, or solicited any offers to buy the
said Notes from, any Person other than the Banks signatory to this Agreement,
and neither the Company nor any agent acting on its behalf will take any action
which would subject the issuance or sale of the said Notes to the provisions of
Section 5 of the Securities Act of 1933, as amended.
SECTION 6.10. USE OF PROCEEDS.
The Company is not engaged, principally or as one of the Company's
important activities, in the business of purchasing or carrying any "margin
stock" as such term is defined in Regulation U of the Board of Governors of the
Federal Reserve System and no part of the proceeds of any advance hereunder will
be used to purchase or to carry any such stock or to extend credit to others for
the purpose of purchasing or carrying any such stock.
SECTION 6.11. GOVERNMENTAL REGULATION.
No consent, approval, authorization, permit or license from any
federal, state or other regulatory authority is required in connection with the
making, delivery or performance of this Agreement or the Notes by the Company.
SECTION 6.12. SUBSIDIARIES.
Schedule II is a complete and correct list of all present Subsidiaries,
all of which are corporations duly incorporated, in good standing and with
corporate power to transact the business presently conducted by them. Except as
disclosed in Schedule II, the Company owns, directly or indirectly through one
or more Subsidiaries, all the shares of each of the Subsidiaries (except
directors' qualifying shares, if any), and all such shares are validly issued,
fully paid and non-assessable and are free and clear of all liens and rights of
others whatsoever.
SECTION 6.13. ERISA.
The Company and each Subsidiary have met their minimum funding
requirements under the Employee Retirement Income Security Act of 1974, as
amended from time to time, with respect to all their employee benefit plans
covered by the minimum funding
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requirements of said Act, and have not incurred any material liability to the
Pension Benefit Guaranty Corporation (or any entity succeeding to any or all of
said Corporation's functions under said Act) under said Act in connection with
any such plan.
SECTION 6.14. ENVIRONMENTAL MATTERS.
The Company and its Subsidiaries are in substantial compliance with all
applicable federal, state and local environmental laws, regulations and
ordinances governing their respective business, properties or assets with
respect to discharges into the ground and surface water, emissions into the
ambient air and generation, storage, transportation and disposal of waste
materials or process by-products, except such noncompliances as are not likely
to have a material adverse effect on the property, assets, business, operations
or condition (financial or otherwise) of the Company and its Subsidiaries taken
as a whole. All licenses, permits or registrations required for the business of
the Company and its Subsidiaries under any federal, state or local environmental
laws, regulations or ordinances have been secured, and the Company and each
Subsidiary are in substantial compliance therewith, except such licenses,
permits or registrations the failure to secure or to comply therewith are not
likely to have a material adverse effect on the property, assets, business,
operations or condition (financial or otherwise) of the Company and its
Subsidiaries taken as a whole.
ARTICLE 7. AFFIRMATIVE COVENANTS
The Company covenants and agrees that until all of its obligations
hereunder have been discharged and the obligations of the Banks to make advances
terminated, it will:
SECTION 7.1. INSURANCE.
Keep adequately insured, by financially sound and reputable insurers,
all property of the character usually insured by corporations engaged in the
same or similar businesses similarly situated, against loss or damage of the
kind customarily insured against by such corporations, and carry adequate
liability insurance and other insurance of a kind generally carried by
corporations engaged in the same or similar businesses similarly situated;
provided, however, that nothing herein contained shall be construed to mean that
a deductibility clause in any such insurance, which, in effect, results in
self-insurance of a level or portion of losses considered reasonable by the
Company's management, shall render such insurance inadequate; and provided
further, that in the case of a lease to the United States Government or an
agency thereof of any aircraft or other property, indemnity therefrom by the
United States Government will be considered adequate insurance against the risks
that are the subject of any such indemnity.
SECTION 7.2. PAYMENT OF TAXES.
Duly file all federal income tax returns and all other tax returns and
reports which, to the knowledge of the officers of the Company are required to
be filed and pay when due
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all taxes and governmental charges assessed against it, its assets, income or
franchises, except to the extent and so long as contested in good faith.
SECTION 7.3. FINANCIAL STATEMENTS.
Deliver to each Bank, so long as such Bank shall hold any Note issued
hereunder or is committed to lend hereunder:
(a) As soon as practicable and in any event within two (2) months after
the end of each quarterly period (other than the last quarterly period in each
fiscal year) an income statement of the Company for the period from the
beginning of the current fiscal year to the end of such quarterly period, and a
balance sheet of the Company as at the end of such quarterly period, setting
forth in each case in comparative form figures for the corresponding period in
the preceding fiscal year, all in reasonable detail and certified by a principal
financial officer of the Company, subject to changes resulting from year-end
adjustments; and a statement as of the end of such quarterly period of the
calculations made by the Company establishing its compliance with the provisions
of Sections 8.1., 8.2. and 8.4. hereof, in sufficient detail to permit the Banks
to determine how the conclusions on such statement were arrived at, certified by
a principal financial officer of the Company as accurate in all material
respects;
(b) As soon as practicable and in any event within three (3) months
after the end of each fiscal year, an income statement and a statement of
reinvested earnings of the Company for such year, and a balance sheet of the
Company as at the end of such year, setting forth in each case in comparative
form corresponding figures from the preceding annual audit, all in reasonable
detail and satisfactory in scope to the Banks and certified by independent
certified public accountants of national standing selected by the Company; and a
statement as of the end of such fiscal year of the calculations made by the
Company establishing its compliance with the provisions of Sections 8.1., 8.2.
and 8.4. hereof, in sufficient detail to permit the Banks to determine how the
conclusions on such statement were arrived at, certified by a principal
financial officer of the Company as accurate in all material respects;
(c) Copies of all financial statements, reports and returns which it
shall send to its stockholders;
(d) Promptly after the sending or filing thereof, copies of all
periodic reports, if any, which the Company shall have filed with the Securities
and Exchange Commission (or any governmental agency or agencies substituted
therefor) under ss.13 or ss.15(d) of the Securities Exchange Act of 1934, as
amended, or with any national securities exchange; and
(e) With reasonable promptness such other financial data as any Bank
may reasonably request through the Agent Bank.
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SECTION 7.4. MAINTENANCE OF EQUIPMENT.
Maintain substantially all of its equipment (except surplus or obsolete
equipment) in good operating order.
SECTION 7.5. INSPECTION.
Permit any Person designated by any Bank in writing, to visit and
inspect any of the properties, corporate books and financial records of the
Company and its Subsidiaries at the Bank's expense, and to discuss the affairs,
finances, and accounts of any such corporation with the principal officers of
the Company, all at such reasonable times and as often as such Bank may
reasonably request. This covenant shall be subject to applicable governmental
and industrial security regulations.
SECTION 7.6. SECURITY FOR NOTES.
In the event the Company secures by mortgage, pledge, encumbrance, lien
or other charge any debt other than as permitted by Section 8.1. hereof, the
Company shall secure equally and ratably the indebtedness incurred hereunder.
SECTION 7.7. NOTICE OF ANY DEFAULT OR EVENT OF DEFAULT.
As soon as practicable (but in any event not more than five (5) days
after the Chairman of the Board, the President, or a principal financial officer
of the Company obtains knowledge of a Default or an Event of Default as
specified in Article 9. hereof), the Company will deliver to each Bank an
Officer's Certificate specifying the nature thereof, the period of existence
thereof and what action the Company has taken or proposes to take with respect
thereto.
SECTION 7.8. ERISA REPORTING REQUIREMENTS.
With respect to any employee benefit plan subject to Title IV of ERISA,
the Company shall, if requested by the Agent Bank, provide the Agent Bank with
copies of the most recent annual reports or returns (IRS Form 5500), audited or
unaudited financial statements and actuarial valuations with respect to such
plans. In addition, the Company shall provide the Agent Bank copies of any
notice filed with the Pension Benefit Guaranty Corporation with respect to any
"Reportable Event" as defined in Section 4043 of ERISA, and the Agent Bank shall
forward copies of any such notice to the Banks.
ARTICLE 8. NEGATIVE COVENANTS
Until all of its obligations hereunder have been discharged and the
obligations of the Banks to make advances terminated, the Company covenants that
it will not and will not permit any Subsidiary to:
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SECTION 8.1. LIENS.
Create, assume or suffer to exist any mortgage, pledge, encumbrance,
lien or charge of any kind upon any of its property or assets, whether now owned
or hereafter acquired, except: (i) mortgages, pledges, encumbrances, liens or
charges where the aggregate indebtedness secured by such mortgages, pledges,
encumbrances, liens or charges at any time does not exceed the sum of (a) the
greater of $1,000,000,000 or fifteen percent (15%) of Equity plus (b) the amount
outstanding under the obligations described on Schedule I hereof as "Secured";
(ii) liens for taxes not yet due or which are being contested in good faith;
(iii) other liens, charges and encumbrances incidental to the conduct of its
business or the ownership of its property and assets which were not incurred to
secure the repayment of borrowed money or other advances or credit, and which do
not in the aggregate materially detract from the value of its property or assets
or materially impair the use thereof in the operation of its business; (iv)
liens imposed by law, such as carriers', warehousemen's, mechanics',
materialmen's and vendors' liens, for sums not yet due or already due but the
validity of which is being contested in good faith; (v) mortgages, pledges,
encumbrances, liens or other charges on property or assets of a Subsidiary to
secure obligations of such Subsidiary to the Company or another Subsidiary; and
(vi) any mortgage, pledge, encumbrance, lien or other charge required by Section
7.6. hereof.
SECTION 8.2. DEBT.
Create, incur, assume or suffer to exist, for the Company and the
Subsidiaries taken together, (a) Current Debt in an aggregate principal amount
at any one time outstanding in excess of 100% of all accounts receivable of the
Company and its Subsidiaries outstanding as of the last day of the second
calendar month next preceding the month in which such calculation of Current
Debt is made, all computed in accordance with generally accepted accounting
principles as in effect from time to time; or (b) Convertible Subordinated Debt
in excess of 33.3% of Equity; or (c) Funded Debt, Current Debt (other than
Convertible Subordinated Debt) and all Guaranty Liabilities (as defined below)
in an amount at any one time which exceeds 150% of Equity at such time. For
purposes of this Section 8.2., "Guaranty Liabilities" shall mean all liabilities
of the Company and any Subsidiary of the Company as guarantor, surety,
accommodation endorser or other accommodation party on behalf of any Person
where the underlying obligation of such Person covered by, or the subject of,
such guaranty or contingent undertaking would constitute Current Debt or Funded
Debt, as defined herein, if such Person were the Company; provided, however,
that (x) guarantees or other contingent undertakings by the Company on behalf of
any Subsidiary, by any Subsidiary on behalf of any other Subsidiary, or by any
Subsidiary on behalf of the Company and (y) the contingent undertakings as set
forth on Schedule III hereto, shall not constitute Guaranty Liabilities.
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SECTION 8.3. MERGERS; DISPOSITION OF ASSETS.
Merge or consolidate with any corporation or sell, lease or transfer or
otherwise dispose of all or a substantial part of its assets in any transaction
or series of related transactions, except that (i) any Subsidiary may merge or
consolidate with the Company or any one or more other Subsidiaries; (ii) any
Subsidiary may sell, lease, transfer or otherwise dispose of any of its assets
to the Company or another Subsidiary; (iii) any Subsidiary may sell or otherwise
dispose of all or substantially all of its assets, provided that (a) such sale
or other disposition is for a consideration which represents fair value (as
determined in good faith by the Company) at the time of such sale or
disposition, and (b) the assets so disposed of do not constitute a substantial
part of the aggregate assets of the Company and the Subsidiaries; (iv) the
Company may dispose of aircraft in the ordinary course of its business, provided
that such sale or other disposition is for a consideration which represents fair
value (as determined in good faith by the Company) at the time of such sale or
disposition; and (v) the Company may merge or consolidate with another
corporation, provided that (a) the Company shall be the continuing or surviving
corporation, (b) a majority of the board of directors of the Company for a
period of six (6) months after the effective date of such merger consists of
individuals who were directors of the Company twelve (12) months prior to such
effective date, and (c) immediately after such merger or consolidation there
shall exist no Event of Default as defined in Article 9. hereof.
SECTION 8.4. LEASES.
Enter into or permit to remain in effect any flight equipment lease
agreements which, as of the close of any fiscal year, cause the Company's
consolidated flight equipment rental expense for such fiscal year to exceed
eight percent (8%) of the Company's consolidated operating revenues for such
fiscal year, provided that any such lease agreements as may be necessary in
connection with interchange agreements between the Company and other airline
related businesses shall not be included in such calculation.
ARTICLE 9. DEFAULTS
SECTION 9.1. EVENTS OF DEFAULT.
Upon the occurrence of any one of the following Events of Default:
(a) Default in any interest payment or principal payment or mandatory
prepayment on any Note or any Reimbursement Obligation when due and the
continuance thereof for five (5) days; or
(b) Default in the payment of any Commitment Fee or any fee or charge
to be paid pursuant to Article 4. hereof, when the same is due hereunder and the
continuance thereof for ten (10) days; or
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(c) The Company shall institute a voluntary case seeking liquidation or
reorganization under Chapter 7 or Chapter 11, respectively, of the United States
Bankruptcy Code, or shall consent to the institution of an involuntary case
thereunder against it; or the Company shall otherwise institute any similar
proceeding under any other applicable federal or state law, or shall consent
thereto; or the Company shall apply for, or by consent or acquiescence there
shall be an appointment of, a custodian, receiver, liquidator, sequestrator,
trustee or other officer with similar powers, for the Company, or for all or a
material part of its properties; or the Company shall make an assignment for the
benefit of creditors; or the Company shall have ceased to pay its debts
generally as they become due; or if an involuntary case shall be commenced
seeking the liquidation or reorganization of the Company under Chapter 7 or
Chapter 11, respectively, of the United States Bankruptcy Code or any similar
proceeding shall be commenced against the Company under any other applicable
federal or state law and (i) the petition commencing the involuntary case is not
timely controverted, (ii) the petition commencing the involuntary case is not
dismissed within forty-five (45) days of its filing, (iii) an interim trustee is
appointed to take possession of all or a portion of the property and/or to
operate all or any part of the business of the Company, or (iv) an order for
relief (other than the petition itself) shall have been issued or entered
therein; or a decree or order of a court having jurisdiction in the premises for
the appointment of a custodian, receiver, liquidator, sequestrator, trustee or
other officer having similar powers for the Company or for all or a part of its
properties, shall have been entered; or any other similar relief shall be
granted against the Company under any applicable federal or state law; or
(d) Default in the observance or performance of any of the affirmative
or negative covenants of the Company hereunder and, where there has been a
default in an affirmative covenant of the Company, such default shall not have
been remedied within thirty (30) days after written notice thereof shall have
been given the Company by any Bank; or
(e) Any representation or warranty made by the Company herein or in any
certificate furnished to the Banks hereunder proves to have been false or
breached in any material respect on the date as of which made or on the date of
any extension of credit hereunder, or any statement or certificate furnished by
the Company pursuant hereto shall prove to have been false in any material
respect at any date as of which the facts therein set forth were stated or
certified; or
(f) Seizure under any legal process of a substantial share of the
assets of the Company if release is not obtained within thirty (30) days of such
seizure; or
(g) Default in any payment of principal or interest on any other
obligation for borrowed money or the deferred purchase price of property beyond
any period of grace provided with respect thereto, or in the payment of any
capital leases, or in the performance or observance of any other agreement, term
or condition contained in any agreement under which any such obligation is
created, if the effect of such default is to cause, or permit the holder or
holders of such obligation (or a trustee acting on behalf of
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such holder or holders) to cause, such obligation to become due prior to its
stated maturity, provided such obligations or agreements have aggregate
outstanding amounts of $25,000,000 or more; or
(h) The Company shall have failed to meet its minimum funding
requirements under the Employee Retirement Income Security Act of 1974, as
amended from time to time (including any rules or regulations promulgated
thereunder) with respect to any of its employee benefit plans which are covered
by Title IV of said Act (or to which ss.412 of the Internal Revenue Code of
1986, as amended, applies), which failure has resulted in a material liability
for excise tax under ss.4971 of said Code; or any of its plans aforesaid shall
be the subject of voluntary or involuntary termination proceedings which may
result in an uninsured payment or repayment liability of the respective
corporation to the Pension Benefit Guaranty Corporation (or any entity
succeeding to any or all of its functions under said Act) in an amount which is
material in relation to the net worth of the Company;
then, in the event that an Event of Default under (a) or (b) above should occur,
any Bank may, at its option, by a written notice to the Company with copies to
each other Bank, if such Event of Default be continuing at the time such notice
is received by the Company, either: (i) declare the obligation of such Bank to
extend credit to the Company hereunder to be immediately terminated, whereupon
such obligation shall terminate; or (ii) declare any Note held by it to be
forthwith due and payable whereupon such Note(s), with accrued interest thereon,
shall become forthwith due and payable without presentment, demand, protest or
any other notice of any kind, all of which are hereby expressly waived by the
Company; or (iii) demand that the Company immediately deposit as cash collateral
with the Agent Bank, for such Bank's account, an amount equal to such Bank's pro
rata share of the Stated Amount of all outstanding Letters of Credit; or (iv)
all of the foregoing. In the event that an Event of Default under (a), (b), or
(d) through (h) above should occur, if such Event of Default be continuing, the
Majority Banks may, at their option, by written notice to the Company, exercise
the remedies listed in (i), (ii), (iii) and (iv) above on behalf of all the
Banks. In the event that an Event of Default under (c) above should occur, the
Total Commitments of the Banks shall automatically terminate and the principal
of and accrued interest on any Notes then outstanding, all unpaid Reimbursement
Obligations and any accrued fees, together with an amount equal to the Stated
Amount of all outstanding Letters of Credit (without regard to whether a draft
has been presented under any of such Letters of Credit), to be held as cash
collateral by the Agent Bank for the Reimbursement Obligations of the Company
with respect to such outstanding Letters of Credit, shall automatically become
due and payable, without protest, presentment, notice or demand, all of which
are expressly waived by the Company.
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ARTICLE 10. YIELD PROTECTION
SECTION 10.1. INCREASED COST OF EURODOLLAR RATE LOANS.
(a) If, as a result of any change after the date of this Agreement in
(including the introduction of any new) applicable United States, state or
foreign laws or regulations or the adoption or making of any interpretations,
directives or requests thereof or thereunder by any court or governmental
authority charged with the interpretation or administration thereof, one or more
of the following events occur (herein called "Increased Cost Changes"):
(i) the basis of taxation of payments to any Bank of the
principal of or interest on any Eurodollar Rate Loan or any other
amounts payable under this Agreement in respect thereof (other than
taxes imposed on the aggregate net income of such Bank or of its
Eurodollar Lending Office by the jurisdiction in which the Bank has its
principal office or such Eurodollar Lending Office) is changed; or
(ii) any reserve, special deposit or similar requirements
against the assets of, deposits with or for the account of, or credit
extended by, any Bank are imposed, modified or deemed applicable; or
(iii) any other condition affecting this Agreement or any
Eurodollar Rate Loan is imposed on any Bank or (in the case of
Eurodollar Rate Loans) the London interbank market;
and a Bank determines that, by reason thereof, the cost to such Bank of making
or maintaining any of the Eurodollar Rate Loans is increased by an amount
reasonably determined by such Bank, or any amount receivable by such Bank
hereunder in respect of any of the Eurodollar Rate Loans is reduced by an amount
reasonably determined by such Bank (such increases in cost and reductions in
amounts receivable being herein called "Increased Costs"), then the Company
shall pay to such Bank on the next interest payment date for the affected
Eurodollar Rate Loans such additional amount or amounts (which shall be set
forth in a notice from such Bank to the Company stating the cause and amount of
such Increased Costs) as will compensate such Bank for such Increased Costs.
Each Bank will immediately notify the Company of any event of which such Bank
has knowledge that will entitle such Bank to compensation pursuant to this
Section 10.1.(a) and will exercise reasonable diligence to designate a different
Eurodollar Lending Office, and/or take other measures which will avoid the need
for such compensation for Increased Costs and will not result in material cost
to such Bank, or be otherwise disadvantageous (in such Bank's sole
determination) to such Bank.
(b) Without limiting the effect of the foregoing, the Company shall pay
(without duplication as to amounts paid under Section 10.1.(a) hereof) to any
Bank on each interest payment date as to Eurodollar Rate Loans so long as such
Bank may be
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required to maintain reserves against "Eurocurrency liabilities" under
Regulation D of the Board of Governors of the Federal Reserve System an
additional amount (determined by such Bank and notified to the Company through
Agent Bank) equal to the sum of the products of the following for each
Eurodollar Rate Loan for each day on which such Bank is required to maintain
such reserves during the Interest Period for such Loan for which interest is
being paid:
(i) the principal amount of such Eurodollar Rate Loan
outstanding on such day; times
(ii) the remainder of (x) a fraction the numerator of
which is LIBOR (expressed as a decimal) used to determine the
Eurodollar Rate for such Eurodollar Rate Loan for such Interest Period
as provided in this Agreement and the denominator of which is one minus
the effective rate (expressed as a decimal) at which such reserve
requirements are imposed on such Bank on such day minus (y) such
numerator; times
(iii) 1/360.
(c) Determinations by any Bank for purposes of this Section 10.1. of
the effect of any Increased Cost Change on such Bank's costs of making or
maintaining Eurodollar Rate Loans or on amounts receivable by it in respect of
Eurodollar Rate Loans, and of the additional amounts required to compensate such
Bank in respect thereof, shall be conclusive, provided that such determinations
are made reasonably and in good faith.
(d) If the Company is required to pay additional amounts to any Bank
under paragraph (a) or (b) of this Section 10.1., the Company may (in addition
to paying such additional amounts to such Bank) at the Company's option at any
time, subject to the provisions of Section 10.3. hereof, convert all of the
Eurodollar Rate Loans of such Bank which are affected by such Increased Costs to
Base Rate Loans in accordance with this Agreement.
SECTION 10.2. CHANGE OF LAW.
Notwithstanding any other provision herein, in the event that any
change in applicable law, rule or regulation or in the interpretation or
administration thereof (including the issuance of any new law, rule, regulation
or interpretation, or any new administration thereof), of or in any jurisdiction
whatsoever, shall make it unlawful for any Bank to make or maintain a Eurodollar
Rate Loan (or to convert Base Rate Loans into Eurodollar Rate Loans), or shall
materially restrict the authority of any Bank to purchase or sell, or to take
deposits of Eurodollars, then the obligation of such Bank to make Eurodollar
Rate Loans (and the right of the Company to convert Base Rate Loans into
Eurodollar Rate Loans) shall be suspended for the duration of such illegality or
restriction and the Company shall forthwith convert all Eurodollar Rate Loans of
such Bank then outstanding to Base Rate Loans in accordance with the terms of
this Agreement.
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SECTION 10.3. FUNDING LOSSES.
The Company shall indemnify a Bank against, and reimburse such Bank on
demand for, any loss or expense incurred or sustained by such Bank, as
reasonably determined by such Bank, as a result of any payment or prepayment
(whether by reason of a voluntary prepayment by the Company or by reason of a
mandatory prepayment of the Loans by reason of an Event of Default, pursuant to
Section 3.16. hereof or other mandatory prepayment provision relating to all
outstanding Loans set forth herein) or conversion of a Eurodollar Rate Loan or
Competitive Bid Loan made by such Bank on a day other than the last day of an
Interest Period for such Loan.
SECTION 10.4. INCREASED COST OF MAINTAINING LETTERS OF CREDIT.
(a) If, as a result of any change after the date of this Agreement in
(including the introduction of any new) applicable United States, state or
foreign laws or regulations or the adoption or making of any interpretations,
directives or requests thereof or thereunder by any court or governmental
authority charged with the interpretation or administration thereof, one or more
of the following events occur (herein called "Increased Letter of Credit Cost
Changes"):
(i) any reserve, special deposit or similar requirements
against the Letters of Credit are imposed, modified or deemed
applicable; or
(ii) any other condition regarding the issuance,
maintenance of, or participation in the Letters of Credit are imposed
upon any Letter of Credit Bank or any other Bank, and the result of any
such event shall be to increase the cost to such Letter of Credit Bank
or such other Bank of issuing, maintaining, or participating in the
Letters of Credit;
and such Letter of Credit Bank or such other Bank determines that, by reason
thereof, the cost to such Letter of Credit Bank or such Bank of issuing,
maintaining, or participating in any of the Letters of Credit is increased by an
amount reasonably determined by such Letter of Credit Bank or such Bank, then,
within fifteen (15) days of such Letter of Credit Bank or such Bank obtaining
knowledge of such change in law, regulation or interpretation thereof, such
Letter of Credit Bank or such Bank shall so notify the Company, and upon receipt
of such notice from such Letter of Credit Bank or such Bank, the Company shall
promptly pay to such Letter of Credit Bank or such Bank, from time to time as
specified by such Letter of Credit Bank or such Bank, additional amounts which
shall be sufficient to compensate such Letter of Credit Bank or such Bank for
such increased cost.
(b) Determinations by a Letter of Credit Bank or any Bank for purposes
of this Section 10.4. of the effect of any Increased Letter of Credit Cost
Change, and of the additional amounts required to compensate such Letter of
Credit Bank or such Bank in
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respect thereof, shall be conclusive, provided that such determinations are made
reasonably and in good faith.
SECTION 10.5. MANDATORY REPAYMENT OR CONVERSION ON CERTAIN EVENTS.
On the last day of an Interest Period during which any Orderly
Replacement Event occurs (which relates to all Banks) and no later than four
Eurodollar Business Days after any Immediate Replacement Event relating to one
or more Banks, all outstanding Eurodollar Rate Loans of such Banks shall, at the
option of the Company, be either: (a) prepaid in full by the Company, together
with any accrued and unpaid interest thereon, or (b) converted to Base Rate
Loans. Each Bank shall promptly notify the Company and Agent Bank of any
Immediate Replacement Event and any Orderly Replacement Event known to such
Bank.
SECTION 10.6. SURVIVAL.
The obligations of the Company under Sections 10.1. through 10.4. of
this Agreement shall survive the repayment of the Loans and all Reimbursement
Obligations and the cancellation of the Notes.
ARTICLE 11. THE AGENT BANK
SECTION 11.1. AUTHORIZATION AND ACTION.
Each Bank hereby appoints and authorizes the Agent Bank to take such
action as agent on its behalf and to exercise such powers under this Agreement
and the Notes as are delegated to it as Agent Bank by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto, and the
Agent Bank hereby accepts such authorization and appointment. As to any matters
not expressly provided for by this Agreement and the Notes or provided for with
specific reference to this Section 11.1. (including, without limitation,
enforcement or collection of the Notes), the Agent Bank shall not be required to
exercise any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from action) upon the instructions of the Majority Banks and such instructions
shall be binding upon all Banks and all holders of the Notes; provided, however,
that the Agent Bank shall not be required to take any action which exposes the
Agent Bank to liability or which is contrary to this Agreement or the Notes or
applicable law. As to any provisions of this Agreement under which action may be
taken or approval given by the Majority Banks, and except for the provisions
contained herein relating to the increase in the Commitments as such increase
relates to a given Bank, the action taken or approval given by the Majority
Banks shall be binding upon all Banks to the same extent and with the same
effect as if each Bank had joined therein. The Agent Bank shall be entitled to
rely upon any note, notice, consent, certificate, affidavit, letter, telegram,
teletype message, facsimile transmission, statement, order or other document
believed by it to be genuine and correct and to have been signed or sent by the
proper person or persons and, in respect of legal
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matters, upon the opinion of counsel selected by the Agent Bank. The Agent Bank
may deem and treat the payee of any Note as the owner thereof for all purposes
hereof unless and until a written notice of the assignment or transfer thereof
shall have been filed with the Agent Bank. Any request, authority or consent of
any Person who at the time of making such request or giving such authority or
consent is the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any note or notes
issued in exchange therefor.
SECTION 11.2. AGENT BANK'S RELIANCE, ETC.
Neither the Agent Bank nor any of its directors, officers, agents or
employees shall be liable to any Bank for any action taken or omitted to be
taken by it or by such directors, officers, agents or employees under or in
connection with this Agreement or the Notes, except for its or their own gross
negligence or willful misconduct. Without limitation of the generality of the
foregoing, the Agent Bank: (i) may consult with legal counsel, independent
public accountants and other experts selected by it and shall not be liable to
any Bank for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such experts; (ii) makes no warranty or
representation to any Bank and shall not be responsible to any Bank for any
statements, warranties or representations made in or in connection with this
Agreement or the Notes; (iii) shall not have any duty to ascertain or to inquire
as to the performance or observance of any of the terms, covenants or conditions
of this Agreement or the Notes on the part of the Company or to inspect the
property (including the books and records) of the Company; (iv) shall not be
responsible to any Bank for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or the
Notes, or any other instrument or document furnished pursuant thereto; and (v)
shall incur no liability under or in respect to this Agreement or the Notes by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by telegram, facsimile transmission, cable or telex) believed by
it to be genuine and signed or sent by the proper party or parties.
SECTION 11.3. AGENT BANK AND AFFILIATES.
With respect to its Commitment, the Loans made by it and the Notes
issued to it, the Agent Bank shall have the same rights and powers under this
Agreement as any other Bank and may exercise the same rights and powers under
this Agreement as any other Bank and may exercise the same as though it were not
the Agent Bank; and the term "Bank" or "Banks" shall, unless otherwise expressly
indicated, include the Agent Bank in its individual capacity. Unrelated to its
role as Agent Bank as set forth herein, the Agent Bank and its affiliates may
accept deposits from, lend money to, and generally engage in any kind of
business with, the Company, and any Person who may do business with or own
securities of the Company, all as if it were not the Agent Bank and without any
duty to account therefor to the Banks.
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SECTION 11.4. REPRESENTATIONS OF THE BANKS.
Each Bank acknowledges that it has, independently and without reliance
upon the Agent Bank, or any affiliate or subsidiary of the Agent Bank, or any
other Bank and based on the financial statements referred to in Section 6.2.
hereof and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement; and that
each Bank has actively engaged in the negotiation of all of the terms of this
Agreement. Each Bank also acknowledges that it will, independently and without
reliance upon the Agent Bank or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement or the
Notes. The Agent Bank has no duty or responsibility, either initially or on a
continuing basis, to provide any Bank with any credit or other information with
respect to the Company whether coming into its possession as of the date of this
Agreement or at any time thereafter, or to notify any Bank of any Event of
Default except as provided in Section 11.5. hereof. This Agreement and all
instruments or documents delivered in connection with this Agreement have been
reviewed and approved by each Bank and the Banks have not relied on the Agent
Bank as to any legal or factual matter in connection therewith or in connection
with the transactions contemplated thereunder.
SECTION 11.5. EVENTS OF DEFAULT.
In the event of the occurrence of any Default or Event of Default, any
Bank knowing of such event may (but shall have no duty to), or the Company
pursuant to Section 7.7. hereof shall, give the Agent Bank written notice
specifying such Event of Default or other event and expressly stating that such
notice is a "notice of default". The Agent Bank shall not be deemed to have
knowledge of such events unless the Agent Bank has received such notice, or
unless the Agent Bank has actual notice of such Default or Event of Default or
other event in its capacity as one of the Banks or unless the Event of Default
consists of a failure of payment of principal or interest on any of the Notes.
In the event that the Agent Bank receives such a notice of the occurrence of an
Event of Default, or has actual knowledge thereof, the Agent Bank shall give
written notice thereof to the Banks. The Agent Bank shall take such action with
respect to such Default or Event of Default as shall be reasonably directed in
writing by the Majority Banks; provided, however, that, unless and until the
Agent Bank shall have received such directions, the Agent Bank may take such
action, or refrain from taking such action, with respect to such Event of
Default as it shall deem advisable and in the best interest of the Banks.
SECTION 11.6. RIGHT TO INDEMNITY.
Except for action expressly required of the Agent Bank hereunder, the
Agent Bank shall be fully justified in failing or refusing to take any action
hereunder unless it shall first be indemnified to its satisfaction by the Banks
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action.
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SECTION 11.7. INDEMNIFICATION.
The Banks hereby agree to indemnify the Agent Bank and the Letter of
Credit Banks (to the extent not reimbursed by the Company), ratably according to
their respective Commitments, as set forth in Section 2.2. hereof, from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against the
Agent Bank and/or such Letter of Credit Bank in any way relating to or arising
out of this Agreement, the Notes and/or the Letters of Credit issued by such
Letter of Credit Bank or any action taken or omitted by the Agent Bank and/or
such Letter of Credit Bank under this Agreement, the Notes and/or such Letters
of Credit; provided, however, that no Bank shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Agent Bank's or such
Letter of Credit Bank's gross negligence or willful misconduct. Without
limitation of the foregoing, each Bank agrees to reimburse the Agent Bank and/or
the applicable Letter of Credit Bank promptly upon demand for its ratable share
of any out-of-pocket expenses (including counsel fees) incurred by the Agent
Bank and/or such Letter of Credit Banks in connection with the administration,
or enforcement of, or the preservation of any rights under, this Agreement, the
Notes and/or the Letters of Credit, to the extent that the Agent Bank or such
Letter of Credit Bank is not reimbursed for such expenses by the Company.
SECTION 11.8. SUCCESSOR AGENT BANK.
The Agent Bank may resign at any time by giving written notice thereof
to the Banks and the Company and may be removed at any time with or without
cause by the Majority Banks. Upon any such resignation or removal, the Company
shall have the right to appoint a successor Agent Bank, subject to confirmation
by the Majority Banks. If no successor Agent Bank shall have accepted such
appointment within 30 days after the retiring Agent Bank's giving of notice of
resignation or the Majority Banks' removal of the Agent Bank the Agent Bank may,
on behalf of the Banks, appoint a successor Agent Bank who shall be willing to
accept such appointment. In any event such successor Agent Bank shall be a
commercial bank organized under the laws of the United States of America or of
any State thereof and shall have a combined capital and surplus of at least
$1,000,000,000. Upon the acceptance of any appointment as Agent Bank hereunder
by a successor Agent Bank, such successor Agent Bank shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring or removed Agent Bank, and the retiring or removed Agent Bank shall be
discharged from its duties and obligations as agent under this Agreement. After
any Agent Bank's resignation or removal hereunder as Agent Bank, the provisions
of this Article 11. shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent Bank under this Agreement.
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ARTICLE 12. MISCELLANEOUS
SECTION 12.1. RIGHTS AND REMEDIES.
No delay or failure of the Banks, the Letter of Credit Banks or the
Agent Bank or any one of them or of the Company in exercising any rights, powers
or privileges hereunder shall affect such right, power or privilege, nor shall
any single or partial exercise thereof preclude any further exercise thereof, or
the exercise of any other right, power or privilege. The rights and remedies of
the Banks, the Letter of Credit Banks and the Agent Bank or any one of them and
of the Company under this Agreement are cumulative and not exclusive of any
rights or remedies which they would otherwise have. Failure on the part of any
Bank, the Letter of Credit Banks, the Agent Bank or the Company to exercise any
right, power or privilege given it hereunder shall not be the breach of any
obligation of the Bank or the Company to any other party to this Agreement or to
any other Person.
SECTION 12.2. NOTICES.
Except as otherwise expressly provided for herein, notices, which may
be given or are required to be given hereunder, shall be in writing and may be
mailed, postage prepaid, addressed as follows or sent by telex or facsimile:
(a) If to the Company, both to:
"Delta Air Lines, Inc.
Attention: Thomas J. Roeck, Jr.,
Senior Vice President-Finance and
Chief Financial Officer
Hartsfield Atlanta International Airport
Atlanta, Georgia 30320"
Facsimile: (404) 715-5042
And to:
"Delta Air Lines, Inc.
Attention: James G. Mathews
Treasurer
Administrative Center
Hartsfield Atlanta International Airport
Atlanta, Georgia 30320."
Facsimile: (404) 715-5042
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(b) If to Agent Bank:
"NationsBank, N.A. (South)
Attention: Douglas J. Wallace
Vice President
P. O. Box 4899
Atlanta, Georgia 30302-4899"
Facsimile: (404) 607-6467
(c) If to any Bank or Letter of Credit Bank other than Agent Bank
at that address, telex number or facsimile number designated in writing to the
Company and the Agent Bank from time to time.
A party may specify a different address or facsimile number by furnishing such
change in writing to all other parties hereto. Additionally, notice may, in lieu
of being given by mail or facsimile, be delivered personally to any officer of
any party to whose attention it could have been addressed.
SECTION 12.3. EXPENSES, INDEMNIFICATION, ETC.
(a) The Company shall pay all reasonable costs, expenses, taxes and
fees (i) incurred by the Agent Bank in connection with the preparation,
execution and delivery of this Agreement, the Notes and all other documents
incident hereto or thereto (collectively, the "Loan Documents") including,
without limitation, the costs and professional fees of Alston & Bird, Atlanta,
Georgia, whether or not any transaction contemplated hereby shall be
consummated, and any and all stamp, intangible or other taxes that may be
payable or determined in the future to be payable in connection therewith, (ii)
incurred by the Agent Bank in connection with the administration of the Loans
and the Loan Documents in accordance with the provisions thereof and the
preparation, execution and delivery of any waiver, amendment or consent by the
Banks, the Letter of Credit Banks or the Agent Bank relating to the Loan
Documents including, without limitation, costs and professional fees of counsel
for the Agent Bank; and (iii) actually incurred by the Agent Bank, the Letter of
Credit Banks or any of the Banks in enforcing the Loan Documents including,
without limitation, reasonable attorneys' fees of counsel for the Agent Bank,
the Letter of Credit Banks or the Banks.
(b) The Company shall indemnify the Agent Bank, the Letter of Credit
Banks and each Bank and hold the Agent Bank, the Letter of Credit Banks and each
Bank (and all directors, officers, employees and agents of any of the foregoing
(the Agent Bank, the Letter of Credit Banks, the Banks and such directors,
officers, employees and agents each referred to as an "Indemnified Party"))
harmless against, any and all costs, losses, liabilities, claims, damages or
expenses incurred by an Indemnified Party, whether jointly or severally, and
whether or not such Indemnified Party is designated a party thereto, arising out
of or by reason of, or relating directly or indirectly to, (i) any
investigation,
-53-
litigation or other proceeding, pending or threatened, regarding any actions or
failure to act by the Company involving this Agreement or any transaction
contemplated hereby, (ii) any actual or proposed use by the Company or any of
its Subsidiaries of the proceeds from any borrowing hereunder or any Letter of
Credit, or (iii) the Agent Bank's, any Bank's, any Letter of Credit Bank's or
the Company's entering into and complying with this Agreement or in issuing or
delivering the Notes or any Letters of Credit and including, without limitation,
the reasonable fees and disbursements of such Indemnified Party's separate
counsel incurred in connection with any such investigation, litigation or other
proceeding (which shall be advanced by the Company on request notwithstanding
any claim or assertion that the Indemnified Party is not entitled to
indemnification hereunder upon receipt of an undertaking to reimburse the
Company if it is actually and finally determined by a court of competent
jurisdiction that the party is not so entitled). However, the indemnity of the
Company set forth herein shall not cover the costs, losses, liabilities, claims,
damages or expenses (x) incurred by an Indemnified Party arising out of the bad
faith or willful misconduct of such Indemnified Party (as actually and finally
determined by a court of competent jurisdiction) or (y) incurred by the Agent
Bank in connection with a suit, claim or cause of action brought against the
Agent Bank by a Bank pursuant to which such Bank alleges that the Agent Bank has
failed to perform the ministerial duties of the Agent Bank as expressly set
forth herein (such as administering the funding and collection of Loans,
determining interest rates and the like).
(c) The Agent Bank, each Letter of Credit Bank and each Bank agree that
in the event that any investigation, litigation, suit, action or proceeding is
asserted or threatened in writing or instituted against it or any other
Indemnified Party for which the Agent Bank, any Letter of Credit Bank or any
Bank may desire indemnity or defense hereunder, the Agent Bank, such Letter of
Credit Bank or such Bank shall promptly notify the Company thereof in writing
and agree, to the extent appropriate, to consult with the Company with a view to
minimizing the cost to the Company of its obligations under this Section 12.3.
(d) No action taken by legal counsel chosen by an Indemnified Party in
defending against any such investigation, litigation, suit, action or proceeding
or requested remedial, removal or response action shall vitiate or in any way
impair the obligations and duties of the Company hereunder to indemnify and hold
harmless each Indemnified Party; provided, however, that if the Company is
required to indemnify any Indemnified Party pursuant hereto, such Indemnified
Party shall not settle or compromise any such investigation, litigation, suit,
action or proceeding without the prior written consent of the Company (which
consent shall not be unreasonably withheld or delayed) so long as the Company
has provided evidence reasonably satisfactory to such Indemnified Party that the
Equity of the Company and its Subsidiaries on a consolidated basis is not less
than zero.
(e) The obligations of the Company under this Section 12.3. shall
survive transfer, payment or satisfaction of any Note and any amendment,
supplementation, modification or termination of this Agreement.
-54-
SECTION 12.4. AMENDMENTS TO THIS AGREEMENT AND THE NOTES.
Any provisions of this Agreement and the Notes may be amended,
terminated, waived or otherwise modified in writing by the Company and the
Majority Banks, and any such amendment, termination, waiver or other
modification shall be binding upon all of the Banks to the same extent and with
the same effect as if each Bank had joined therein; provided, however, that,
notwithstanding the foregoing: (a) any provisions of this Agreement and the
Notes with respect to any change in (i) the expressed maturity date of the whole
or any principal or interest payable under any Note, (ii) the rate of interest
payable under any Note or on the Reimbursement Obligations (other than any
change in the rate of interest pursuant to the next to last paragraph of the
definition of Applicable Margin), (iii) the amount of any Commitment (except as
permitted in Sections 2.3, 3.14 and 12.6), (iv) the amount or due date of any
fees payable hereunder (other than any change in the amount of Commitment Fee
pursuant to the next to last paragraph of Section 3.11 hereof), or (v) the due
date of any principal of, or interest on, any Loan, or the date on which any
Reimbursement Obligation is due and payable, or (vi) Section 3.18. or this
Section 12.4., may be amended or otherwise modified only in a writing signed by
the Company and all of the Banks; (b) any Event of Default described in Sections
9.1.(a), 9.1.(b) or 9.1.(c) may be waived only in a writing signed by all of the
Banks; (c) no provisions of Article 11. shall be amended, modified, or waived
without the consent of the Agent Bank; and (d) no provisions of Article 4. shall
be amended, modified or waived without the consent of each Letter of Credit
Bank; provided, however, that the consent of any Letter of Credit Bank that has
no outstanding or unreimbursed Letters of Credit and no obligation to issue
Letters of Credit shall not be required. The definition of "Majority Banks" as
set forth herein shall not be changed without the unanimous written consent of
the Banks.
SECTION 12.5. AGREEMENT AS TO RIGHT OF SET-OFF, SHARING OF LOSSES.
So long as any Syndicated Note is outstanding, each Bank agrees that,
if it has payment made to it on any Syndicated Note, whether by set-off or
otherwise, including, but not limited to, any payment received by such Bank
under any applicable bankruptcy, insolvency or similar laws, in a greater
proportion than payments made on Syndicated Notes held by any other Bank, the
Bank so receiving such greater proportionate payment agrees to purchase a
portion of the Syndicated Notes held by the other Banks, so that after such
purchase each Bank will hold an unpaid balance on its Syndicated Note bearing
the same proportion to the then outstanding aggregate principal amount of the
Syndicated Notes as such Bank's Commitment bears to the Banks' aggregate
Commitments; provided that if any amount so received by any Bank in payment of
the Syndicated Note held by it shall be, as a result of the reversal of the
exercise of any such right (whether by court order or voluntary action on the
part of such Bank), returned to the Company or the Subsidiary or paid as
directed by such court order by such Bank, then each other Bank which shall have
theretofore received its share of any such payment pursuant to this Section
12.5. shall, upon demand, promptly repay, without interest, the amount of such
share to such Bank, or, if the Bank exercising such right shall not have made
the purchases provided for in this Section 12.5. prior to such reversal, the
other Banks shall have no
-55-
further rights under this Section 12.5. in respect to such amount. Except as
provided in this Section and in Sections 11.6. and 11.7., no Bank shall be
responsible to any other Bank for losses or claims which such Bank may incur in
connection with the transactions contemplated by this Agreement. The Company
agrees that any Bank so purchasing a participation from another Bank pursuant to
this Section 12.5. may exercise all its rights of payment (including the right
of set-off) with respect to such participation as fully as if such Bank were the
direct creditor of the Company in the amount of such participation.
SECTION 12.6. SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon the Company and the Banks and
their respective successors and assigns, and shall inure to the benefit of the
Company and the Banks and their respective successors and assigns. The Company
may not assign its rights or obligations hereunder, except as permitted by
Section 8.3. hereof. Other than by virtue of operation of law, no Bank shall
assign any portion of its Commitment hereunder unless (a) the portion of the
Bank's Commitment to be assigned is equal to or greater than $25,000,000 (or
such lesser amount as the Company may approve in its sole discretion), and the
assigning Bank retains a Commitment in an amount equal to at least 50% of its
Commitment at the Effective Date; (b) the assigning Bank has received the prior
written approval of the Company and the Agent Bank to the proposed assignment;
(c) the Agent Bank has been paid an assignment fee of $2,500 by the assigning
Bank; and (d) the bank which has received the assignment of the Commitment, the
assigning Bank, the Company and the Agent Bank shall have executed the Form of
Assignment as set forth on Exhibit D hereto. Upon compliance with the provisions
set forth above, such financial institution shall thereupon and thereafter be
deemed to be a Bank for all purposes hereunder, and the Agent Bank shall give
notice to all of the Banks of the assignment. There shall be no sale by any Bank
of any participation in its Commitment; provided, however, any Bank may (x)
pledge its Loans and/or Notes hereunder to a Federal Reserve Bank in support of
borrowings made by such Bank from such Federal Reserve Bank or (y) participate
all or a portion of its Commitment and related outstandings hereunder to its
parent company and/or any affiliate of such Bank which is at least fifty percent
owned by such Bank or its parent company.
SECTION 12.7. HOLIDAYS.
When any payment hereunder falls due on a day that is not a Business
Day, such payment shall be made as herein provided on the next succeeding
Business Day. Interest shall continue to accrue on the principal to be paid
until it is paid.
SECTION 12.8. LAW GOVERNING.
This Agreement shall be construed and performance thereof shall be
determined according to the laws of the State of Georgia.
-56-
SECTION 12.9. DISCLOSURE TO OTHER PERSONS.
The Company acknowledges that any Bank may deliver copies of any
financial statements and other documents delivered to such Bank, and disclose
any other information disclosed to such Bank, by or on behalf of the Company or
any Subsidiary in connection with or pursuant to this Agreement to (i) such of
the Bank's directors, officers, employees, agents and professional consultants
as may require such information in the performance of their respective duties,
(ii) any Person to which such Bank offers to assign any Note or any part thereof
if (a) such disclosure has been previously approved by the Company, or (b) such
disclosure is not of information previously designated by the Company as
"privileged" or "confidential", (iii) any federal or state regulatory authority
having jurisdiction over such Bank, or (iv) any other Person to which such
delivery or disclosure may be necessary or appropriate (a) in compliance with
any law, rule, regulation or order applicable to such Bank, (b) in response to
any subpoena or other legal process or (c) in connection with any litigation to
which such Bank is a party; provided, however, that such Bank, to the extent
legally permitted to do so, will use its best efforts to notify the Company
prior to any disclosure of information contemplated by this subparagraph (iv)
and will use its best efforts to give the Company the opportunity to object to
any such disclosure; provided, further, that the foregoing proviso shall not
require such Bank to withhold such information where such withholding would
subject such Bank to civil or criminal liabilities or penalties, as determined
by such Bank in its discretion.
SECTION 12.10. EXECUTION AND EFFECTIVE DATE.
This Agreement may be executed in any number of counterparts, and any
party hereto may execute the said Agreement by signing any such counterpart. The
Company shall deliver one such executed counterpart to Agent Bank and each Bank
shall deliver one such executed counterpart to the Agent Bank for further
delivery to the Company. This Agreement shall be effective as of the Effective
Date.
SECTION 12.11. REPRESENTATION OF BANKS.
Each Bank represents for itself only that it is acquiring the Notes to
be acquired by it hereunder for its own account in the ordinary course of
extending credit as a banking institution and not with a view to the
distribution or resale thereof, subject, nevertheless, to any requirement of law
that the disposition of the property of a Bank shall at all times be within its
control.
SECTION 12.12. SEVERABILITY.
Any provision of this Agreement or of the Notes which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof or thereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
-57-
SECTION 12.13. ENTIRE AGREEMENT.
This Agreement and the Notes express the entire understanding of the
parties with respect to the transactions contemplated hereby. Neither this
Agreement, the Notes nor any term hereof or thereof may be changed, waived,
discharged or terminated orally or in writing, except as provided in Section
12.4. hereof.
[SIGNATURES ON FOLLOWING PAGES]
-58-
[SIGNATURE PAGE TO DELTA CREDIT AGREEMENT
DATED AS OF MAY 2, 1997]
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Agreement to be duly executed.
THE COMPANY:
DELTA AIR LINES, INC.
By:
-----------------------------------------
Title:
--------------------------------------
Attest:
By:
-----------------------------------------
Title:
--------------------------------------
THE AGENT BANK:
NATIONSBANK, N.A. (SOUTH),
as Agent Bank and individually as a Bank
By:
-----------------------------------------
Title:
--------------------------------------
THE BANKS:
MANAGING AGENTS
BANK OF AMERICA, NATIONAL
TRUST AND SAVINGS ASSOCIATION
By:
-----------------------------------------
Title:
--------------------------------------
-59-
[SIGNATURE PAGE TO DELTA CREDIT AGREEMENT
DATED AS OF MAY 2, 1997]
THE CHASE MANHATTAN BANK
By:
-----------------------------------------
Title:
--------------------------------------
CITICORP. USA, INC.
By:
-----------------------------------------
Title:
--------------------------------------
ROYAL BANK OF CANADA
By:
-----------------------------------------
Title:
--------------------------------------
CO-MANAGING AGENTS
THE MITSUBISHI TRUST AND
BANKING CORPORATION
By:
-----------------------------------------
Title:
--------------------------------------
SUNTRUST BANK, ATLANTA
By:
-----------------------------------------
Title:
--------------------------------------
-60-
[SIGNATURE PAGE TO DELTA CREDIT AGREEMENT
DATED AS OF MAY 2, 1997]
WACHOVIA BANK OF GEORGIA, N.A.
By:
-----------------------------------------
Title:
--------------------------------------
CO-AGENTS
THE BANK OF TOKYO-MITSUBISHI,
LTD., NEW YORK BRANCH
By:
-----------------------------------------
Title:
--------------------------------------
CIBC INC.
By:
-----------------------------------------
Title:
--------------------------------------
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, ATLANTA AGENCY
By:
-----------------------------------------
Title:
--------------------------------------
THE NORTHERN TRUST COMPANY
By:
-----------------------------------------
Title:
--------------------------------------
-61-
[SIGNATURE PAGE TO DELTA CREDIT AGREEMENT
DATED AS OF MAY 2, 1997]
PARTICIPANTS
BANK OF MONTREAL
By:
-----------------------------------------
Title:
--------------------------------------
THE BANK OF NEW YORK
By:
-----------------------------------------
Title:
--------------------------------------
BAYERISCHE VEREINSBANK AG
NEW YORK BRANCH
By:
-----------------------------------------
Title:
--------------------------------------
By:
-----------------------------------------
Title:
--------------------------------------
THE DAI-ICHI KANGYO BANK,
LIMITED, ATLANTA AGENCY
By:
-----------------------------------------
Title:
--------------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
By:
-----------------------------------------
Title:
--------------------------------------
-62-
[SIGNATURE PAGE TO DELTA CREDIT AGREEMENT
DATED AS OF MAY 2, 1997]
KREDIETBANK N.V., GRAND CAYMAN BRANCH
By:
-----------------------------------------
Title:
--------------------------------------
PNC BANK, NATIONAL ASSOCIATION
By:
-----------------------------------------
Title:
--------------------------------------
THE SANWA BANK, LIMITED,
ATLANTA AGENCY
By:
-----------------------------------------
Title:
--------------------------------------
THE TOYO TRUST & BANKING CO., LTD.
By:
-----------------------------------------
Title:
--------------------------------------
MORGAN GUARANTY TRUST
COMPANY OF NEW YORK
By:
-----------------------------------------
Title:
--------------------------------------
-63-
[SIGNATURE PAGE TO DELTA CREDIT AGREEMENT
DATED AS OF MAY 2, 1997]
THE FUJI BANK, LIMITED
By:
-----------------------------------------
Title:
--------------------------------------
CREDIT LYONNAIS NEW YORK BRANCH
By:
-----------------------------------------
Title:
--------------------------------------
STAR BANK, N.A.
By:
-----------------------------------------
Title:
--------------------------------------
THE SUMITOMO BANK, LIMITED
By:
-----------------------------------------
Title:
--------------------------------------
-64-
EXHIBIT A-1
FORM OF SYNDICATED NOTE
$________________
________________, ____
FOR VALUE RECEIVED, DELTA AIR LINES, INC., a Delaware corporation (the
"Maker"), promises to pay to the order of (together with any successor and
assign thereof or any subsequent holder hereof referred to herein as the
"Holder") the lesser of (a) ________ Dollars in lawful money of the United
States or (b) the aggregate unpaid principal amount of all Syndicated Loans
which are still outstanding and which were made to the Maker by the Holder
pursuant to that certain Credit Agreement dated as of May 2, 1997 (as the same
may be amended, modified or supplemented from time to time, the "Credit
Agreement"; terms used herein and not defined herein have their respective
defined meanings as set forth in the Credit Agreement) by and among the Maker,
the Banks set forth therein and NationsBank, N.A. (South), as Agent Bank, at
the Main Office of the Agent Bank, or at such other place as is otherwise
specified in the Credit Agreement. The Company shall repay the principal amount
of this Note on the Termination Date. The outstanding principal amount hereof
shall bear interest at the rates and shall be payable at the times set forth in
the Credit Agreement.
Any payment of principal or interest which is not paid when due, as
herein provided, shall bear interest (to the extent permitted by law) at that
rate which is one-quarter of one percent (1/4%) above the Base Rate in effect on
each respective day thereafter until paid in full and such interest shall be
payable on demand.
This Note is one of the Syndicated Notes issued pursuant to, and is
entitled to the benefits of, the Credit Agreement. To the extent provided in the
Credit Agreement, this Note is subject to voluntary prepayment, in whole or in
part, without premium or penalty.
Upon the occurrence of an Event of Default, the aggregate unpaid
principal amount of all Syndicated Loans evidenced hereby which are still
outstanding and accrued interest thereon may become due and payable in the
manner and with the effect provided in the Credit Agreement.
Time is of the essence of this Note, and in case this Note is not paid
when due, and is subsequently collected by law or through an attorney at law, or
under advice therefrom, the Maker agrees to pay all costs of collection incurred
by the Holder including, without limitation, the reasonable fees and
disbursements of counsel to the Holder.
A-1-1
The undersigned and all endorsers or other parties to this Note hereby
waive presentment, demand for payment, protest and notice of nonpayment.
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Note as of the date first written above.
DELTA AIR LINES, INC.
(CORPORATE SEAL)
By:
-----------------------------------------
Title:
-----------------------------------
[Reverse of Note]
Advance Payment
------- -------
Date Loan Amount Principal Interest
---- ----------- --------- --------
A-1-2
EXHIBIT A-2
FORM OF COMPETITIVE BID NOTE
____________, ____
FOR VALUE RECEIVED, DELTA AIR LINES, INC., a Delaware corporation (the
"Maker"), promises to pay to the order of _______________ (together with any
successor and assign thereof or any subsequent holder hereof referred to herein
as the "Holder") the aggregate unpaid principal amount of all Competitive Bid
Loans which are still outstanding and which were made to the Maker by the
Holder pursuant to that certain Credit Agreement dated as of May 2, 1997 (as
the same may be amended, modified or supplemented from time to time, the
"Credit Agreement"; terms used herein and not defined herein have their
respective defined meanings as set forth in the Credit Agreement) by and among
the Maker, the Banks set forth therein and NationsBank, N.A. (South), as Agent
Bank, at the Main Office of the Agent Bank, or at such other place as is
otherwise specified in the Credit Agreement on the Termination Date or such
earlier date as may be required pursuant to the terms of the Credit Agreement.
The Company agrees to pay interest on the unpaid principal amount hereof on the
dates and at the rates as agreed to by the Maker and the Holder pursuant to the
terms of the Credit Agreement.
Any payment of principal or interest which is not paid when due, as
herein provided, shall bear interest (to the extent permitted by law) at that
rate which is one-quarter of one percent (1/4%) above the Base Rate in effect on
each respective day thereafter until paid in full and such interest shall be
payable on demand.
This Note is one of the Competitive Bid Notes issued pursuant to, and
is entitled to the benefits of, the Credit Agreement.
Upon the occurrence of an Event of Default, the aggregate unpaid
principal amount of all Competitive Bid Loans evidenced hereby which are still
outstanding and accrued interest thereon may become due and payable in the
manner and with the effect provided in the Credit Agreement.
Time is of the essence of this Note, and in case this Note is not paid
when due, and is subsequently collected by law or through an attorney at law, or
under advice therefrom, the Maker agrees to pay all costs of collection incurred
by the Holder including, without limitation, the reasonable fees and
disbursements of counsel to the Holder.
The undersigned and all endorsers or other parties to this Note hereby
waive presentment, demand for payment, protest and notice of nonpayment.
A-2-1
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Note as of the date first written above.
DELTA AIR LINES, INC.
(CORPORATE SEAL)
By:
-----------------------------------------
Title:
-----------------------------------
[Reverse of Note]
Advance Payment
------- -------
Date Loan Amount Principal Interest
---- ----------- --------- --------
A-2-2
EXHIBIT B
FORM OF NOTICE OF INCREASED COMMITMENT
[Date]
NationsBank, N.A. (South), as Agent Bank
600 Peachtree Street, 21st Floor
Atlanta, Georgia 30303
Attention: Douglas J. Wallace
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of May 2,
1997 (the "Credit Agreement") by and among Delta Air Lines, Inc. (the
"Company"), the Banks party thereto and NationsBank, N.A. (South), as Agent
Bank. Terms used herein and not defined herein have their respective defined
meanings as set forth in the Credit Agreement.
1. Pursuant to Section 2.3.(b)(i) of the Credit Agreement, the Company
and the undersigned Bank hereby notify the Agent Bank that the Company and such
Bank propose to increase such Bank's Commitment under the Credit Agreement from
$_____________ to $___________. Such proposed increase shall be effective on the
later of (a) the date the Agent Bank and, if applicable, the Majority Banks,
consent to such increase and (b) ______________, ____.
2. [If proposed increase results in an increase of the Total
Commitments of the Banks from that which exists on the Effective Date of
$250,000,000 or less - Pursuant to Section 2.3(a) of the Credit Agreement, the
consent of the Agent Bank is necessary for the proposed increase in such Bank's
Commitment. If the Agent Bank so consents, kindly indicate such consent by
signing at the space provided below.]
[If proposed increase results in an increase of the Total Commitments of the
Banks from that which exists on the Effective Date of between $250,000,000 and
$500,000,000 - Pursuant to Section 2.3(a) of the Credit Agreement, the
consent of the Agent Bank and Majority Banks is necessary for the proposed
increase in such Bank's Commitment. The Company and the undersigned Bank
request that: (a) the Agent Bank consent to such
B-1
proposed increase and (b) the Agent Bank promptly poll the other Banks to
determine whether the Majority Banks consent to such increase.]
Very truly yours,
DELTA AIR LINES, INC.
By:
-----------------------------------------
Title:
-----------------------------------
[RELEVANT BANK]
By:
-----------------------------------------
Title:
----------------------------------
The Agent Bank hereby consents to the above-described increase in the
Commitment of [Insert Bank] under the Credit Agreement [and confirms that the
Majority Banks also consent thereto].
NATIONSBANK, N.A. (SOUTH), as Agent Bank
By:
-----------------------------------------
Title:
-----------------------------------
B-2
EXHIBIT C-1
FORM OF NOTICE AND AGREEMENT REGARDING ADDITION OF BANK
[Date]
NationsBank, N.A. (South), as Agent Bank
600 Peachtree Street, 21st Floor
Atlanta, Georgia 30303
Attention: Douglas J. Wallace
Delta Air Lines, Inc.
Administrative Center
Hartsfield Atlanta International Airport
Atlanta, Georgia 30320
Attention: James G. Mathews, Treasurer
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of May 2,
1997 (the "Credit Agreement") by and among Delta Air Lines, Inc. (the
"Company"), the Banks party thereto and NationsBank, N.A. (South), as Agent
Bank. Terms used herein and not defined herein have their respective defined
meanings as set forth in the Credit Agreement.
1. Pursuant to Section [2.3.(c)] [3.14.3] of the Credit Agreement, the
undersigned hereby requests that it become a Bank under the Credit Agreement.
The proposed Commitment of the undersigned as a Bank under the Credit Agreement
would equal $ __________. [For 2.3.(c) additions only - The undersigned
proposes that the undersigned shall become a Bank under the Credit Agreement on
the later of (a) the date the Agent Bank and the Company and, if applicable,
the Majority Banks consent to such increase and (b) ____________, ____ (the
"Effective Date").] [For 3.14.3 additions only - later of consent by the
Company and the Agent Bank and (the "Effective Date").]
2. Upon the Effective Date, the undersigned hereby assumes all of the
obligations of a Bank having a Commitment of $______________ under the Credit
Agreement as if the undersigned were an original Bank and signatory under the
Credit Agreement including, but not limited to, the obligation of a Bank to make
advances to the Company thereunder and to reimburse the Agent Bank, for the
account of the Letter of Credit Banks, for Drawings under Letters of Credit to
the extent of its Commitment, and to indemnify the Agent Bank as provided
therein. In this connection, the undersigned hereby represents that it has
received and reviewed a copy of the Credit Agreement and hereby ratifies and
approves all of the terms and conditions of the Credit Agreement and the other
documents executed and delivered in connection therewith.
C-1-1
3. For purposes of delivering any notice to the undersigned as a Bank
under the Credit Agreement, the following sets forth the address of the
undersigned for such purpose:
__________________________________
__________________________________
__________________________________
Telecopy No. _____________________
Attention:________________________
4. The undersigned acknowledges that it has, independently and without
reliance upon the Agent Bank, or on any affiliate or subsidiary thereof, or any
other Bank and based on the financial statements supplied by the Company and
such other documents and information as it has deemed appropriate, made its own
credit analysis and decision to become a Bank under the Credit Agreement. The
undersigned also acknowledges that it will, independently and without reliance
upon the Agent Bank or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Credit Agreement or
its respective Note. The Agent Bank shall have no duty or responsibility, either
initially or on a continuing basis, to provide the undersigned with any credit
or other information with respect to the Company or to notify the undersigned of
any Event of Default except as provided in Section 11.5. of the Credit
Agreement. The undersigned has not relied on the Agent Bank as to any legal or
factual matter in connection therewith or in connection with the transactions
contemplated thereunder.
5. This letter agreement shall not be binding against the undersigned
unless and until the Company and the Agent Bank have executed their consent to
the foregoing at the space provided below.
6. THIS LETTER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA.
7. This letter agreement may be executed in any number of counterparts
each of which, when taken together, shall constitute one and the same agreement.
8. [For 2.3(c) additions only - If proposed addition of Bank results in
an increase of the Total Commitments of the Banks from that which exists on the
Effective Date of $250,000,000 or less - Pursuant to Section 2.3(a) and (c) of
the Credit Agreement, the consent of the Agent Bank and the Company is necessary
for the undersigned to become a Bank under the Credit Agreement. If the Agent
Bank and the Company so consent, kindly indicate such consent by signing at the
spaces provided below.]
[If proposed addition of Bank results in an increase of the Total Commitments of
the Banks from that which exists on the Effective Date of between $250,000,000
and $500,000,000 - Pursuant to Section 2.3(a) and (c) of the Credit Agreement,
the consent of the Agent Bank, the Company and Majority Banks is necessary for
the undersigned to become a Bank under the Credit Agreement. The undersigned
requests that: (a) the Agent Bank and the Company consent to the undersigned
becoming a Bank under the Credit Agreement and (b) the Agent Bank promptly poll
the other Banks
C-1-2
to determine whether the Majority Banks consent to the undersigned becoming a
Bank under the Credit Agreement. If the Company and the Agent Bank so consent,
kindly indicate such consent by signing at the spaces provided below.]
Very truly yours,
[FINANCIAL INSTITUTION]
By:
-----------------------------------------
Title:
-----------------------------------
The Company hereby agrees that, on the Effective Date, _____________
("_______________") shall be a Bank under the Credit Agreement having a
Commitment equal to $________________ pursuant to the terms and conditions set
forth above. The Company agrees that _____________________ shall have all of the
rights and remedies of a Bank under the Credit Agreement as if
___________________ were an original Bank and signatory under the Credit
Agreement including, but not limited to, the right of a Bank to receive payments
of principal and interest with respect to the Loans made by the Banks and to
receive the commitment and other fees payable to the Banks as provided in the
Credit Agreement. Further, ____________________ shall be entitled to the
indemnification provisions from the Company in favor of the Banks as provided in
the Credit Agreement. The Company further agrees, on the Effective Date, to
execute in favor of _________________________ a promissory note in substantially
the form of Exhibit A-1 to the Credit Agreement in the face amount of
___________________'s Commitment.
DELTA AIR LINES, INC.
By:
-----------------------------------------
Title:
-----------------------------------
The Agent Bank hereby consents to __________________ becoming a Bank
under the Credit Agreement pursuant to the foregoing terms and conditions [and
confirms that the Majority Banks also consent thereto.]
NATIONSBANK, N.A. (SOUTH), as Agent Bank
By:
-----------------------------------------
Title:
-----------------------------------
C-1-3
EXHIBIT C-2
FORM OF AGREEMENT OF EXISTING BANK
TO REPLACE REPLACED BANK
NationsBank, N.A. (South), as Agent Bank
600 Peachtree Street, 21st Floor
Atlanta, Georgia 30303
Attention: Douglas J. Wallace
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of May 2,
1997 (the "Credit Agreement") by and among Delta Air Lines, Inc. (the
"Company"), the Banks party thereto and NationsBank, N.A. (South), as Agent
Bank. Terms used herein and not defined herein have their respective defined
meanings as set forth in the Credit Agreement.
Pursuant to Section 3.14.3 of the Credit Agreement, the undersigned
Bank (the "Existing Bank") hereby agrees to assume [$____________] of the
obligations and Commitment of ____________________________ (the "Replaced Bank")
under the Credit Agreement. Accordingly, the Commitment of the Existing Bank
shall be increased from $_______________ to $________________. Except for the
increase in the Commitment contemplated hereby, the Existing Bank shall continue
to have all of the rights, remedies, duties and obligations of a Bank under the
Credit Agreement.
Very truly yours,
[EXISTING BANK]
By:
-----------------------------------------
Title:
--------------------------------------
The Agent Bank hereby consents to the above-described increase in the
Commitment of [Insert Bank] under the Credit Agreement.
NATIONSBANK, N.A. (SOUTH), as Agent Bank
By:
-----------------------------------------
Title:
-----------------------------------
C-2-1
EXHIBIT D
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT dated as of __________, ____
by and among __________________ (the "Assignor"), ____________ (the "Assignee"),
DELTA AIR LINES, INC. (the "Company") and NATIONSBANK, N.A. (SOUTH), as Agent
Bank.
WHEREAS, the Assignor is a Bank under that certain Credit Agreement
dated as of May 2, 1997 (the "Credit Agreement"; terms used herein and not
defined herein have their respective defined meanings as set forth in the Credit
Agreement) by and among the Company, the Banks named therein and the Agent Bank;
WHEREAS, the Assignor desires to assign to the Assignee (a) [all] [a
portion] of the Loans made by the Assignor to the Company under the Credit
Agreement, (b) [all] [a portion] of the Assignor's obligation to reimburse the
Agent Bank, for the account of the Letter of Credit Banks, for drawings under
Letters of Credit, and (c) [all] [a portion] of the Assignor's Commitment under
the Credit Agreement, all on the terms and conditions set forth herein;
WHEREAS, the Company and the Agent Bank consent to such assignment on
the terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the parties hereto, the parties
hereto hereby agree as follows:
1. Subject to the terms and conditions of this Agreement, the Assignor
hereby irrevocably transfers and assigns to the Assignee, without recourse,
[all of the Assignor's right title and interest in and to] [an undivided
_______ percent interest in] all Loans made by the Assignor to the Company
under the Credit Agreement] [a principal amount of Syndicated Loans made by
the Assignor to the Company under the Credit Agreement equal to $______________
[and a principal amount of Competitive Bid Loans made by the Assignor to the
Company under the Credit Agreement equal to $____________]] (such Loans herein
referred to as the "Assigned Loans") together with all rights of the Assignor
to receive all payments of principal and interest from the Company with respect
to such Assigned Loans and all rights of collection and enforcement the
Assignor may have against the Company with respect to such Assigned Loans.
Further, but subject to the terms and conditions set forth herein, the Assignor
hereby irrevocably transfers and assigns to the Assignee [all of the
Assignor's] [$_____ of the Assignor's] Commitment under the Credit Agreement
(the "Assigned Commitment") including all voting rights of the Assignor
associated with such amount of Assigned Commitment, all rights to receive all
commitment and other fees with respect to such Assigned Commitment and other
rights of the Assignor under the Credit Agreement with respect to such amount
of Assigned Commitment, all as if the Assignee were an original Bank and
signatory under the Credit Agreement having a Commitment equal to the Assigned
Commitment. The Assignee, subject to the terms and conditions hereof, hereby
assumes all obligations of the Assignor with respect to
D-1
the Assigned Commitment as if the Assignee were an original Bank and signatory
under the Credit Agreement having a Commitment equal to the Assigned Commitment
including, but not limited to, the obligation of the Assignor to make advances
to the Company with respect to the Assigned Commitment, to reimburse the Agent
Bank, for the account of the Letter of Credit Banks, for drawings under any
Letter of Credit and to indemnify the Agent Bank as provided therein. The
Assignor shall have no further duties or obligations with respect to, and shall
have no further interest in, the Assigned Loans or the Assigned Commitment.
2. The Assignor hereby represents and warrants to the Assignee that:
(a) the Assignor is a Bank under the Credit Agreement having a Commitment under
the Credit Agreement immediately prior to the effectiveness of this Agreement
equal to $________ and that the Assignor is not in default of its obligations
under the Credit Agreement; (b) immediately prior to the effectiveness of this
Agreement, the Assignor held $ __________ in principal amount of Syndicated
Loans and $_______________ in principal amount of Competitive Bid Loans
outstanding and owing by the Company to the Assignor; and (c) immediately prior
to the effectiveness of this Agreement, there was $___________ aggregate face
amount of Letters of Credit outstanding under the Credit Agreement.
3. The Assigned Loans and Reimbursement Obligations shall be without
recourse to the Assignor. The Assignee acknowledges and agrees that, except as
provided in paragraph 2 above, the Assignor is making no representations or
warranties with respect to, and the Assignee hereby releases and discharges the
Assignor for any responsibility or liability for: (i) the present or future
solvency or financial condition of the Company, (ii) any representations,
warranties, statements or information made or furnished by the Company in
connection with the Credit Agreement or otherwise, (iii) the validity, efficacy,
sufficiency, or enforceability of the Credit Agreement or any document or
instrument executed in connection therewith, or the collectibility of the
Assigned Loans and Reimbursement Obligations, (iv) the perfection, priority or
validity of any lien, security interest or pledge with respect to any collateral
at any time securing the obligations of the Company under the Credit Agreement
or the Assigned Loans under the Notes or the Credit Agreement and (v) the
performance or failure to perform by the Company of any obligation under the
Credit Agreement or any document or instrument executed in connection therewith.
Further, the Assignee acknowledges that it has, independently and
without reliance upon the Agent Bank, or on any affiliate or subsidiary thereof,
the Assignor or any other Bank and based on the financial statements supplied by
the Company and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to become a Bank under
the Credit Agreement. The undersigned also acknowledges that it will,
independently and without reliance upon the Agent Bank, the Assignor or any
other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement or its respective Note(s). The
Agent Bank shall have no duty or responsibility, either initially or on a
continuing basis, to provide the Assignee with any credit or other information
with respect to the Company or to notify the Assignee of any Event of Default
except as provided in Section 11.5. of the Credit Agreement. The Assignee has
not relied on the Agent Bank, the Assignor or any
D-2
other Bank as to any legal or factual matter in connection therewith or in
connection with the transactions contemplated thereunder.
4. Upon the execution and delivery of this Agreement, the Assignee
shall deliver to the Assignor by wire transfer of immediately available funds
$_____________. [Insert amounts owing with respect to assigned Loans, etc.]
[Other consideration/adjustments].
5. The Company hereby agrees that the Assignee shall be a Bank under
the Credit Agreement having a Commitment equal to the Assigned Commitment. The
Company agrees that the Assignee shall have all of the rights and remedies of a
Bank under the Credit Agreement as if the Assignee were an original Bank and
signatory under the Credit Agreement including, but not limited to, the right of
a Bank to receive payments of principal and interest with respect to the
Assigned Loans, if any, and to the Syndicated Loans made by the Banks after the
date hereof and to receive the commitment and other fees payable to the Banks as
provided in the Credit Agreement. Further, the Assignee shall be entitled to the
indemnification provisions from the Company in favor of the Banks as provided in
the Credit Agreement. The Company further agrees, upon the execution and
delivery of this Agreement, to execute in favor of the Assignee a promissory
note in substantially the form of Exhibit A-1 to the Credit Agreement in the
face amount of the Assigned Commitment and a promissory note in substantially
the form of Exhibit A-2 to the Credit Agreement to evidence any Competitive Bid
Loans. Further, the Company agrees that, upon the execution and delivery of this
Agreement, the Company shall owe the Assigned Loans to the Assignee as if the
Assignee were the Bank originally making such Loans.
6. For purposes of delivering any notice to the Assignee as a Bank
under the Credit Agreement, the following sets forth the address of the Assignee
for such purpose:
___________________________________
___________________________________
___________________________________
Telecopy No. ______________________
Attention:_________________________
7. The Agent Bank hereby consents to the assignment and assumption
contemplated herein and agrees to notify the Banks of such assignment.
8. The Assignor agrees to pay the Agent Bank a servicing fee equal to
$2,500 immediately upon the execution and delivery of this Agreement.
9. This Agreement, and the assignment and assumption contemplated
herein, shall not be effective until (a) this Agreement is signed by each of the
Assignor, the Assignee, the Company and the Agent Bank; (b) the payment to the
Assignor of the amounts owing by the Assignee pursuant to paragraph 4 hereof;
and (c) the payment to the Agent Bank of the fee owing to the Agent Bank
pursuant to paragraph 8 hereof.
D-3
10. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF GEORGIA.
11. This Agreement may be executed in any number of counterparts each
of which, when taken together, shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Assignment and Assumption Agreement as of the date and year first written above.
THE ASSIGNOR:
--------------------------------------------
By:
-----------------------------------------
Title:
-----------------------------------
THE ASSIGNEE:
--------------------------------------------
By:
-----------------------------------------
Title:
-----------------------------------
THE COMPANY:
DELTA AIR LINES, INC.
By:
-----------------------------------------
Title:
-----------------------------------
THE AGENT BANK:
NATIONSBANK, N.A. (SOUTH), as Agent Bank
By:
-----------------------------------------
Title:
-----------------------------------
D-4
EXHIBIT E
FORM OF COMPETITIVE BID QUOTE CONFIRMATION
TO: Delta Air Lines, Inc.
ATTENTION: ________________________
RE: Competitive Bid Quote to Delta Air Lines, Inc. (the "Company")
This Competitive Bid Quote is given in accordance with Section 3.3.(c)
of that certain Credit Agreement dated as of May 2, 1997 (as modified and
supplemented and in effect from time to time, the "Credit Agreement") by and
among the Company, the Banks named therein and NationsBank, N.A. (South), as
Agent Bank. Terms used herein and not defined herein have their respective
defined meanings as set forth in the Credit Agreement.
In response to the Company's request for offers to make Competitive Bid
Loans dated _____________, ____, we hereby make the following Competitive Bid
Quote(s) on the following terms:
1. Quoting Bank:_________________________________________________
2. Person to contact at Quoting Bank:____________________________
3. We hereby offer to make Competitive Bid Loans(s) in the
following principal amount(s), for the following Interest Period(s) and at the
following rate(s):
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
E-1
[Download Table]
================================================================
BORROWING QUOTATION AMOUNT(2) INTEREST RATE
DATE DATE(1) PERIOD(3)
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
================================================================
We understand and agree that the offer(s) set forth above, subject to
the satisfaction of the applicable conditions set forth in the Credit Agreement,
irrevocably obligate(s) us to make the Competitive Bid Loan(s) for which any
offer(s) (is/are) accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
By:
-----------------------------------------
Dated: _____________, ____
------------------------------
(1) As specified in the related Competitive Bid Quote Request.
(2) The principal amount bid for each Interest Period may not exceed the
principal amount requested. Bids must be made for at least $10,000,000
or a larger multiple of $1,000,000.
(3) A period of up to 180 days after the making of such Competitive Bid
Loan, as specified in the related Competitive Bid Quote Request.
E-2
EXHIBIT F
FORM OF ACCEPTANCE OF COMPETITIVE BID QUOTES
DELTA AIR LINES, INC.
NAME OF BANK RATE QUOTE AMOUNT ALLOCATED
DELTA AIR LINES, INC.
By:
-----------------------------------------
Title:
-----------------------------------
F-1
EXHIBIT G
FORM OF LETTER ACKNOWLEDGING TERMINATION
OF EXISTING CREDIT AGREEMENT
May 2, 1997
NationsBank, N.A. (South), as Agent Bank
600 Peachtree Street, 21st Floor
Atlanta, Georgia 30308
Ladies and Gentlemen:
Reference is hereby made to that certain Second Amended and Restated
Credit Agreement dated as of September 27, 1995 (as amended, the "Existing
Credit Agreement") by and among Delta Air Lines, Inc. (the "Company"), each of
the financial institutions a signatory thereto, together with their permitted
assignees pursuant to Section 12.6 thereof and NationsBank, N.A. (South),
formerly known as NationsBank of Georgia, National Association, as Agent Bank.
The Company hereby acknowledges and agrees that, as of the date hereof,
the Existing Credit Agreement is terminated and of no force and effect.
Very truly yours,
DELTA AIR LINES, INC.
By:
-----------------------------------------
Title:
--------------------------------------
III-1
SCHEDULE I
FUNDED DEBT*
1. 7.55-9.15% Notes with maturities ranging from 1997 to 2007
2. 9.875% Notes due January 1, 1998
3. 9.875% Notes due May 15, 2000
4. 8.50% Notes due March 15, 2002
5. 8.10% Guaranteed Serial ESOP Notes, payable in installments between 2002 and
2009
6. 10.125% Debentures due May 15, 2010
7. 10.375% Debentures due February 1, 2011
8. 9.00% Debentures due May 15, 2016
9. 9.75% Debentures due May 15, 2021
10. 9.25% Debentures due March 15, 2022
11. 10.375% Debentures due December 15, 2022
12. Development Authority of Fulton County Loan Agreement dated September 1,
1992
13. Development Authority of Clayton County Loan Agreement dated January 1, 1988
14. Capital Leases:
(a) Forty-One B737-200 Aircraft Leases
(b) Nine Western Aircraft Leases (4 B737-200; 3 B737-300 and 2
B727-200)
*ALL OF WHICH IS UNSECURED EXCEPT ITEM 14(b).
SECURED OBLIGATIONS
1. $96,500,000 The Port Authority of NY and NJ Special Projects Bonds, Series I
(Delta Air Lines, Inc. Project)
2. Nine Western Air Lines Capital Leases (4 B737-200; 3 B737-300 and
2 B727-200)
3. SATO Guaranty (pledge of Company's government receivables to provide
collateral for SATO credit agreement)
SCHEDULE II
SUBSIDIARIES OF DELTA AIR LINES, INC.
Aero Assurance Ltd.
Crown Rooms, Inc.
Crown Rooms of Texas, Inc.
DAL Foreign Sales, Inc.
DAL Moscow, Inc.
Delta Air Lines and Pan American World Airways
Unterstutzungkasse GmbH
Delta Air Lines Funding Corporation
Delta Air Lines Holdings, Inc.
DeltaTel, Inc.
Delta Staffing Services, Inc.
Delta Ventures III, Inc.
Delta U.K. Investments Limited
Epsilon Trading, Inc.
Lesteris Limited
TransQuest, Inc.
TransQuest Holding Limited
TransQuest (UK) Limited
Jaison Vermogensuerwaltnngs GmbH
SCHEDULE III
GUARANTY LIABILITIES
$88,000,000 Regional Airports Improvement Corporation 6.35% Facilities Sublease
Revenue Bonds, Issue of 1996 Delta Air Lines, Inc. (Los Angeles International
Airport)
SATO Guaranty (Company's allocable share of $25 million SATO revolving credit
facility; used by SATO to advance payments to participating airlines on
government receivables)
Dates Referenced Herein and Documents Incorporated by Reference
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