Revolving Credit Facility Agreement

Exhibit 10.1


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$1,200,000,000


FIVE-YEAR COMPETITIVE ADVANCE AND
REVOLVING CREDIT FACILITY AGREEMENT


Dated as of March 22, 2005


among


WEYERHAEUSER COMPANY, and


WEYERHAEUSER REAL ESTATE COMPANY, as Borrowers,


THE LENDERS, THE SWING LINE BANKS AND INITIAL FRONTING BANKS NAMED
HEREIN,


JPMORGAN CHASE BANK, N.A., as Administrative Agent,


CITIBANK, N.A., as Syndication Agent,


BANK OF AMERICA, N.A., DEUTSCHE BANK SECURITIES INC. and
THE BANK OF TOKYO-MITSUBISHI, LTD., as Documentation Agents,


and


MORGAN STANLEY BANK, as Co-Documentation Agent


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J.P. MORGAN SECURITIES INC. and CITIGROUP GLOBAL MARKETS INC.,
as Lead Arrangers and Joint Book Runners
TABLE OF CONTENTS


PAGE
---- ARTICLE I DEFINITIONS.................................................... 1
Section 1.01 Defined Terms.......................................... 1
Section 1.02 Terms Generally........................................ 15
Section 1.03 Accounting Terms; GAAP................................. 15


ARTICLE II THE CREDITS................................................... 15
Section 2.01 Commitments............................................ 15
Section 2.02 Loans.................................................. 16
Section 2.03 Conversion and Continuation of Loans................... 18
Section 2.04 Fees................................................... 19
Section 2.05 Repayment of Loans; Evidence of Debt................... 21
Section 2.06 Interest on Loans...................................... 22
Section 2.07 Default Interest....................................... 24
Section 2.08 Alternate Rate of Interest............................. 24
Section 2.09 Termination and Reduction of Commitments............... 24
Section 2.10 Prepayment............................................. 25
Section 2.11 Reserve Requirements; Change in Circumstances.......... 25
Section 2.12 Change in Legality..................................... 27
Section 2.13 Indemnity.............................................. 28
Section 2.14 Pro Rata Treatment..................................... 29
Section 2.15 Sharing of Setoffs..................................... 29
Section 2.16 Payments............................................... 30
Section 2.17 Taxes.................................................. 30
Section 2.18 Mitigation Obligations; Replacement of Lenders......... 33
Section 2.19 Competitive Bid Procedure.............................. 34
Section 2.20 Letters of Credit...................................... 36
Section 2.21 Swing Line Loans....................................... 40


ARTICLE III REPRESENTATIONS AND WARRANTIES............................... 41
Section 3.01 Organization; Powers................................... 41
Section 3.02 Authorization.......................................... 41
Section 3.03 Enforceability......................................... 42
Section 3.04 Consents and Approvals................................. 42
Section 3.05 Financial Statements................................... 42
Section 3.06 No Material Adverse Change............................. 42
Section 3.07 Title to Properties; Possession Under Leases........... 43
Section 3.08 Subsidiaries........................................... 43
Section 3.09 Litigation; Compliance with Laws....................... 43
Section 3.10 Agreements............................................. 43
Section 3.11 Federal Reserve Regulations............................ 43
Section 3.12 Investment Company Act; Public Utility Holding
Company Act............................................ 44
Section 3.13 Tax Returns............................................ 44


(i)
Section 3.14 No Material Misstatements.............................. 44
Section 3.15 Compliance with ERISA.................................. 44
Section 3.16 Environmental Matters.................................. 45
Section 3.17 Maintenance of Insurance............................... 45


ARTICLE IV CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT....... 45
Section 4.01 All Borrowings and Issuances........................... 45
Section 4.02 Closing Date........................................... 46


ARTICLE V AFFIRMATIVE COVENANTS.......................................... 47
Section 5.01 Existence; Businesses and Properties................... 48
Section 5.02 Insurance.............................................. 48
Section 5.03 Obligations and Taxes.................................. 48
Section 5.04 Financial Statements, Reports, etc..................... 49
Section 5.05 Litigation and Other Notices........................... 50
Section 5.06 ERISA.................................................. 51
Section 5.07 Maintaining Records; Access to Properties and
Inspections............................................ 51
Section 5.08 Use of Proceeds........................................ 52
Section 5.09 Environmental Matters.................................. 52
Section 5.10 OCBM Agreement......................................... 53
Section 5.11 Further Assurances..................................... 53


ARTICLE VI NEGATIVE COVENANTS............................................ 54
Section 6.01 Covenants of Weyerhaeuser.............................. 54
Section 6.02 Covenants with respect to WRECO........................ 56


ARTICLE VII EVENTS OF DEFAULT............................................ 60
Section 7.01 Events of Default...................................... 60


ARTICLE VIII THE ADMINISTRATIVE AGENT.................................... 62
Section 8.01 The Administrative Agent............................... 62
Section 8.02 Other Agents........................................... 65


ARTICLE IX MISCELLANEOUS................................................. 65
Section 9.01 Notices................................................ 65
Section 9.02 Survival of Agreement.................................. 66
Section 9.03 Binding Effect......................................... 66
Section 9.04 Successors and Assigns................................. 67
Section 9.05 Expenses; Indemnity.................................... 69
Section 9.06 Right of Setoff........................................ 70
Section 9.07 Applicable Law......................................... 70
Section 9.08 Waivers; Amendment..................................... 71
Section 9.09 Interest Rate Limitation............................... 71
Section 9.10 Entire Agreement....................................... 72
Section 9.11 WAIVER OF JURY TRIAL................................... 72
Section 9.12 Severability........................................... 72


(ii)
Section 9.13 Counterparts........................................... 72
Section 9.14 Headings............................................... 72
Section 9.15 Jurisdiction; Consent to Service of Process............ 72
Section 9.16 Domicile of Loans...................................... 73
Section 9.17 Restricted and Unrestricted Subsidiaries............... 73
Section 9.18 USA PATRIOT Act........................................ 75


EXHIBITS


Exhibit A Form of Revolving Borrowing Request Exhibit B Form of Administrative Questionnaire Exhibit C Form of Assignment and Acceptance Exhibit D-1 Form of Certification of Financial Statements for Weyerhaeuser Exhibit D-2 Form of Certification of Financial Statements for WRECO Exhibit D-3 Form of Compliance Certificate for Weyerhaeuser Exhibit D-4 Form of Compliance Certificate for WRECO Exhibit E Form of Subordinated Debt Exhibit F Form of Promissory Note Exhibit G Form of Swing Line Borrowing Request


SCHEDULES


Schedule 2.01 Commitments Schedule 2.20 Existing Letters of Credit Schedule 3.08 Subsidiaries of Weyerhaeuser and WRECO Schedule 9.01 Notices


(iii)
FIVE-YEAR COMPETITIVE ADVANCE AND REVOLVING CREDIT FACILITY AGREEMENT dated as of March 22, 2005 among WEYERHAEUSER COMPANY, a Washington corporation ("Weyerhaeuser"), WEYERHAEUSER REAL ESTATE COMPANY, a Washington corporation ("WRECO," together with Weyerhaeuser, the "Borrowers" and each, individually, a "Borrower"), the lenders listed in Schedule 2.01 (together with each assignee that becomes a party hereto pursuant to Section 9.04, a "Lender," and collectively, the "Lenders"), JPMORGAN CHASE BANK, N.A., a national banking association ("JPMorgan Chase Bank") and CITIBANK, N.A., a national banking association ("Citibank"), as initial fronting banks (collectively, in such capacities, the "Initial Fronting Banks"), JPMORGAN CHASE BANK and CITIBANK, as swing line banks (in such capacities, the "Swing Line Banks"), JPMORGAN CHASE BANK as administrative agent for the Lenders (in such capacity, and its successors in such capacity, the "Administrative Agent"), CITIBANK, as syndication agent (in such capacity, the "Syndication Agent"), BANK OF AMERICA, N.A., DEUTSCHE BANK SECURITIES INC. and THE BANK OF TOKYO-MITSUBISHI, LTD., as documentation agents (collectively, in such capacities, the "Documentation Agents"), and MORGAN STANLEY BANK, as co-documentation agent (in such capacity, the "Co-Documentation Agent").


WITNESSETH:


WHEREAS, the Borrowers have entered into that certain Third Amended and Restated 364-Day Revolving Credit Facility Agreement, dated as of March 23, 2004 (the "Existing 364-Day Revolving Credit Agreement") with JPMorgan Chase Bank, as administrative agent, Morgan Stanley Senior Funding, Inc., as syndication agent, The Bank of Tokyo-Mitsubishi, Ltd. and Deutsche Bank Securities Inc. as co-documentation agents, and the lenders party thereto from time to time.


WHEREAS, the Borrowers have requested that the Lenders enter into this Five-Year Competitive Advance and Revolving Credit Agreement (a) to refinance the Existing 364-Day Revolving Credit Agreement, (b) to pay costs and expenses related to such re-financing, (c) to provide the Borrowers and their Subsidiaries with financing for general corporate purposes and to back-stop commercial paper issuances and (d) to provide for the issuance of Letters of Credit for the account of Weyerhaeuser which are to be utilized for general corporate purposes.


WHEREAS, WRECO will derive a substantial benefit from the credit extended to Weyerhaeuser.


NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements contained herein, the parties hereto hereby agree as follows:


ARTICLE I


DEFINITIONS


Section 1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings specified below:
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"Adjusted Net Worth" shall mean, as of the date of any computation thereof, the aggregate amount of capital stock (less treasury stock), surplus and retained earnings of WRECO and its Restricted Subsidiaries, after deducting (i) goodwill, patents, trade names, trademarks, unamortized debt discount and expense, deferred assets (other than prepaid taxes and insurance), experimental or organizational expense, any reappraisal, revaluation or write-up assets, and such other assets as are properly classified as "intangible assets" of WRECO and its Restricted Subsidiaries in accordance with GAAP, (ii) all minority interests in the capital stock and surplus of the Restricted Subsidiaries of WRECO, (iii) all Investments in Unrestricted Subsidiaries of WRECO, and (iv) all Investments of WRECO and its Restricted Subsidiaries in any joint venture, partnership or similar entity (not including any Investments in any Restricted Subsidiary of WRECO) entered into for the purpose of acquiring, developing, constructing, owning, operating, selling or leasing any Real Estate Assets.


"Administrative Agent Fees" shall have the meaning given such term in Section 2.04(b).


"Administrative Questionnaire" shall mean an Administrative Questionnaire in the form of Exhibit B hereto.


"Affiliate" shall mean, when used with respect to a specified person, another person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the person specified.


"Aggregate Credit Exposure" shall mean the aggregate amounts of the Lenders' Credit Exposures.


"Agreement" shall mean this Five-Year Competitive Advance and Revolving Credit Facility Agreement, together with all amendments, supplements and modifications hereof.


"Applicable Margin" shall have the meaning given such term in Section 2.06(d).


"Applicable Percentage" of any Lender at any time shall mean the percentage of the Total Commitment represented by such Lender's Commitment. In the event the Commitments shall have expired or been terminated, the Applicable Percentage shall be determined on the basis of the Commitments most recently in effect, but giving effect to assignments pursuant to Section 9.04.


"Applicable Utilization Fee Percentage" shall have the meaning given such term in Section 2.06(e).


"Assignment and Acceptance" shall mean an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agent, which acceptance shall be governed by the terms of Section 9.04, substantially in the form of Exhibit C.


"Base Rate" shall mean, for any day, a rate per annum equal to the higher of (i) the Prime Rate and (ii) 1/2 of 1% plus the Federal Funds Rate, each as in effect from time to time. If for any reason the Administrative Agent shall have determined (which determination shall be
3


conclusive absent manifest error) that it is unable to ascertain the Federal Funds Rate, including the inability or failure of the Administrative Agent to obtain sufficient quotations in accordance with the terms thereof, the Base Rate shall be determined without regard to clause (ii) of the first sentence of this definition, until the circumstances giving rise to such inability no longer exist. Any change in the Base Rate due to a change in the Prime Rate or the Federal Funds Rate shall be effective on the effective date of such change in the Prime Rate or the Federal Funds Rate, respectively.


"Base Rate Borrowing" shall mean a Borrowing comprised of Base Rate Loans.


"Base Rate Loan" shall mean any Loan bearing interest at a rate determined by reference to the Base Rate in accordance with the provisions of Article II.


"Board" shall mean the Board of Governors of the Federal Reserve System of the United States.


"Borrower" and "Borrowers" shall have the respective meanings given such terms in the introductory paragraph hereto.


"Borrowing" shall mean a group of Loans of a single Type made by the Lenders (or, in the case of a Competitive Borrowing, by the Lender or Lenders whose Competitive Bids have been accepted pursuant to Section 2.19) on a single date and as to which a single Interest Period is in effect.


"Borrowing Request" shall mean a Revolving Borrowing Request or a Swing Line Borrowing Request, as the case may be.


"Business Day" shall mean any day (other than a day which is a Saturday, Sunday or legal holiday in the State of New York) on which banks are open for business in New York City; provided, however, that, when used in connection with a Eurodollar Loan, the term "Business Day" shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.


"Capital Base" shall mean, as of the date of any computation thereof, the sum of (i) Adjusted Net Worth plus (ii) the amount of WRECO/Weyerhaeuser Subordinated Debt then outstanding not to exceed Adjusted Net Worth.


"Capital Lease Obligations" of any person shall mean the obligations of such person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such person under GAAP and, for purposes of this Agreement, the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with GAAP.


A "Change in Control" shall be deemed to have occurred with respect to (a) Weyerhaeuser if, (i) any person or group (within the meaning of Rule 13d-5 of the SEC as in effect on the date hereof) shall own directly or indirectly, beneficially or of record, shares representing more than 20% of the aggregate ordinary voting power represented by the issued
4


and outstanding capital stock of Weyerhaeuser, (ii) a majority of the seats (other than vacant seats) on the board of directors of Weyerhaeuser shall at any time have been occupied by persons who were neither (A) nominated by the management of Weyerhaeuser in accordance with its charter and by-laws, nor (B) appointed by directors so nominated, or (iii) any person or group shall otherwise directly or indirectly Control Weyerhaeuser, and (b) WRECO if Weyerhaeuser shall fail to own directly or indirectly, beneficially or of record, shares representing at least 79% of the aggregate ordinary voting power represented by the issued and outstanding capital stock of WRECO.


"Class," when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, is a Revolving Loan or Competitive Loan.


"Closing Date" shall mean the first date on which the conditions precedent set forth in Section 4.02 shall have been satisfied.


"Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to the Code are to the Code, as in effect at the date of this Agreement and any subsequent provisions of the Code, amendatory thereof, supplemental thereto or substituted therefor.


"Commitment" shall mean, with respect to each Lender, the commitment of such Lender hereunder as set forth in Schedule 2.01 or in the Assignment and Acceptance pursuant to which such Lender shall have assumed its Commitment, as applicable, as such Lender's Commitment may be permanently reduced, increased or terminated from time to time pursuant to Section 2.09, Section 2.18, Article VII or Section 9.04.


"Competitive Bid" shall mean an offer by a Lender to make a Competitive Loan in accordance with Section 2.19.


"Competitive Bid Rate" shall mean, with respect to any Competitive Bid, the Margin or the Fixed Rate, as applicable, offered by the Lender making such Competitive Bid.


"Competitive Bid Request" shall mean a request by the Borrower for Competitive Bids in accordance with Section 2.19.


"Competitive Borrowing" shall mean a Borrowing consisting of Competitive Loans or concurrent Competitive Loans from the Lender or Lenders whose Competitive Bids for such Borrowing have been accepted by the Borrower under the bidding procedure described in Section 2.19.


"Competitive Loan" shall mean a Loan made pursuant to Section 2.19.


"Control" shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of voting securities or by contract, and "Controlling" and "Controlled" shall have meanings correlative thereto.
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"Credit Exposure" shall mean, with respect to each Lender, at any time, the aggregate principal amount at such time of all outstanding Revolving Loans of such Lender to the Borrowers, plus the aggregate amount at such time of such Lender's L/C Exposure, plus the aggregate amount at such time of such Lender's Swing Line Exposure.


"Default" shall mean any event or condition which upon notice, lapse of time or both would constitute an Event of Default.


"Dollars," "dollars" or "$" shall mean lawful money of the United States of America.


"Domestic Subsidiary" shall mean any subsidiary organized under the laws of any State of the United States of America, substantially all the assets of which are located, and substantially all the business of which is conducted, in the United States of America.


"Environmental Claims" shall mean any and all administrative, regulatory, or judicial actions, suits, demand letters, claims, liens, notices of noncompliance or violation, investigations, or proceedings relating in any way to any Environmental Law (hereinafter referred to as "claims") or any permit issued under any such Environmental Law, including without limitation (a) any and all claims by Governmental Authorities for enforcement, cleanup, removal, response, remedial, or other actions or damages pursuant to any applicable Environmental Law, and (b) any and all claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation, or injunctive relief resulting from Hazardous Materials or arising from alleged injury or threat of injury to health, safety, or the environment.


"Environmental Laws" shall mean any and all Federal, state, local and foreign statutes, laws, regulations, ordinances, codes, rules (including rules of common law), judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or other governmental restrictions now or hereafter in effect relating to the environment, health, safety, Hazardous Materials (including, without limitation, the manufacture, processing, distribution, use, treatment, storage, Release, and transportation thereof) or to industrial hygiene or the environmental conditions on, under or about real property, including, without limitation, soil, groundwater, and indoor and outdoor ambient air conditions.


"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to ERISA are to ERISA, as in effect at the date of this Agreement and any subsequent provisions of ERISA, amendatory thereof, supplemental thereto or substituted therefor.


"ERISA Affiliate" shall mean any trade or business (whether or not incorporated) that, together with Weyerhaeuser or WRECO, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414(b), (c), (m) or (o) of the Code.


"Eurodollar Borrowing" shall mean a Borrowing comprised of Eurodollar Loans.
6


"Eurodollar Loan" shall mean any Loan bearing interest at a rate determined by reference to the Eurodollar Rate in accordance with the provisions of Article II.


"Eurodollar Rate" shall mean, with respect to any Eurodollar Borrowing for any Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on any successor or substitute page of such Service, or any successor to or substitute for such Service, providing rate quotations comparable to those currently provided on such page of such Service, as determined by the Administrative Agent from time to time for the purpose of providing quotations of interest rates applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, as the rate for dollar deposits with a maturity comparable to such Interest Period. In the event that such rate is not available at such time for any reason, then the "Eurodollar Rate" with respect to such Eurodollar Borrowing for such Interest Period shall be the rate at which dollar deposits of $5,000,000 and for a maturity comparable to such Interest Period are offered by the principal London office of the Administrative Agent in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period.


"Event of Default" shall have the meaning given such term in Article VII.


"Existing 364-Day Revolving Credit Agreement" shall have the meaning given such term in the preliminary statements hereto.


"Existing Letters of Credit" shall have the meaning given such term in Section 2.20(a).


"Facility Fees" shall have the meaning given such term in Section 2.04(a).


"Federal Funds Rate" shall mean, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for the day of such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.


"Fees" shall mean the Facility Fees, the Fronting Fee, the L/C Participation Fee and the Administrative Agent Fees.


"Financial Officer" of any corporation shall mean the chief financial officer, principal accounting officer, treasurer or controller of such corporation.


"Fixed Rate" shall mean, with respect to any Competitive Loan (other than a Eurodollar Competitive Loan), the fixed rate of interest per annum specified by the Lender making such Competitive Loan in its related Competitive Bid.


"Fixed Rate Borrowin ...