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Loan Agreement
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EXHIBIT B TO PARTICIPATION AGREEMENT
FORM OF LOAN AGREEMENT
dated as of May 28, 1999
among
FIRST SECURITY TRUST COMPANY OF NEVADA,
not in its individual capacity, except as expressly state
herein, but solely as Trustee, as Borrower,
▇▇▇▇▇▇ FINANCIAL LEASING, INC.
as Agent
and
THE PERSONS NAMED ON SCHEDULE I,
as Lenders
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LOAN AGREEMENT
TABLE OF CONTENTS
PAGE(S)
ARTICLE I DEFINITIONS 1
SECTION 1.1. Defined Terms 1
ARTICLE II AMOUNT AND TERMS OF COMMITMENTS;
REPAYMENT AND PREPAYMENT OF LOANS 1
SECTION 2.1. Commitment; Term 1
SECTION 2.2. Notes 1
SECTION 2.3. Procedure for Borrowing 2
SECTION 2.4. Prepayments; Lease Termination Payments and Premium 2
SECTION 2.5. Interest Rates 2
SECTION 2.6. Determination of Interest Rate 3
SECTION 2.7. Pro Rata Treatment among Loans 3
SECTION 2.8. Payment from Trust Estate Only 3
SECTION 2.9. Taxes 3
SECTION 2.10. Illegality 4
SECTION 2.11. Increased Costs and Reduction of Return 4
SECTION 2.12. Funding Losses 5
SECTION 2.13. Inability to Determine Rates 5
SECTION 2.14. Survival 6
ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST ESTATE 6
SECTION 3.1. Rent Distribution 6
SECTION 3.2. Distribution of Mandatory Prepayments 6
SECTION 3.3. Distribution of Payments After Loan Event of Default 6
SECTION 3.4. Other Payments 7
SECTION 3.5. Distribution of Excluded Amounts 8
SECTION 3.6. Guaranty Payments 8
ARTICLE IV ARTICLE IV CONDITIONS PRECEDENT 8
ARTICLE V AFFIRMATIVE COVENANTS OF BORROWER 8
SECTION 5.1. Performance by Borrower 8
SECTION 5.2. Waiver by Borrower 8
ARTICLE VI LOAN EVENTS OF DEFAULT; REMEDIES 9
SECTION 6.1. Loan Events of Default 9
SECTION 6.2. Remedies 9
ARTICLE VII AGENT 11
SECTION 7.1. Appointment and Authorization 11
SECTION 7.2. Delegation of Duties 11
SECTION 7.3. Liability of Agent 11
SECTION 7.4. Reliance by Agent 11
SECTION 7.5. Notice of Default 12
SECTION 7.6. Credit Decision 12
SECTION 7.7. Indemnification of Agent 12
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SECTION 7.8. Agent in Individual Capacity 13
SECTION 7.9. Successor Agent 13
SECTION 7.10. Withholding Tax 13
SECTION 7.11. Concerning the Trust Estate 14
SECTION 7.12. Distribution and Receipt of Payments by Trust Company 15
ARTICLE VIII MISCELLANEOUS 16
SECTION 8.1. Amendments and Waivers 16
SECTION 8.2. Notices 16
SECTION 8.3. Successors and Assigns; Transfers and Participations 16
SECTION 8.4. Counterparts 16
SECTION 8.5. GOVERNING LAW 16
SECTION 8.6. Survival and Termination of Agreement 16
SECTION 8.7. Entire Agreement 17
SECTION 8.8. Severability 17
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LOAN AGREEMENT
LOAN AGREEMENT
THIS LOAN AGREEMENT (as amended and supplemented from time to time,
this "Loan Agreement"), dated as of May 28, 1999, is entered into by and among
FIRST SECURITY TRUST COMPANY OF NEVADA, a Nevada trust company, not in its
individual capacity, except as expressly provided herein, but solely as Trustee
under the Trust Agreement of even date herewith ("Borrower"); ▇▇▇▇▇▇ FINANCIAL
LEASING, INC, a Delaware corporation, as Agent; and the Persons named on
Schedule I hereto, as Lenders.
WITNESSETH:
WHEREAS, Borrower desires to pay costs associated with the acquisition
of the Equipment and to pay certain costs related thereto, all as more
particularly described in the Participation Agreement of even date herewith and
in each of the other Operative Documents; and
WHEREAS, Borrower desires to borrow from Lenders a portion of the costs
associated with the acquisition of the Equipment;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows.
ARTICLE I
DEFINITIONS
SECTION 1.1. Defined Terms. The capitalized terms used herein and not
otherwise defined shall have the meanings ascribed thereto in Appendix I to the
Participation Agreement dated as of the date hereof among Stratosphere Gaming
Corp., as Lessee; Stratosphere Corporation, as Guarantor; Borrower; Agent; and
Lenders identified therein (as amended, supplemented or otherwise modified from
time to time, the "Participation Agreement") for all purposes hereof.
ARTICLE II
AMOUNT AND TERMS OF COMMITMENTS;
REPAYMENT AND PREPAYMENT OF LOANS
SECTION 2.1. Commitment; Term. Subject to the terms and conditions
hereof and of the Participation Agreement, each Lender severally agrees to make
a term loan to Borrower ("Loans") for the purpose of enabling Trustee to pay for
Equipment Costs, in an aggregate principal amount at any one time outstanding
not to exceed the amount of such Lender's Commitment.
SECTION 2.2. Notes.
(a) The Loans made by each Lender shall be evidenced by a
promissory note of Borrower, substantially in the form of Exhibit A (a "Note"),
with appropriate insertions as to payee and principal amount, duly executed by
Borrower and payable to the order of such Lender and in a maximum principal
amount equal to such Lender's Commitment. Each Note shall be dated the Closing
Date and delivered to the related Lender in accordance with Section 2.3 of the
Participation Agreement. Each Note shall (i) be stated to mature on the Final
Maturity Date and
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(ii) bear interest on the unpaid principal amount thereof from time to time
outstanding at the applicable interest rate per annum determined as provided in,
and payable as specified in, Section 2.6.
(b) Upon the consummation of the Advance, each Lender shall,
and is hereby authorized by Borrower and Lessee to, record in its records the
amount of the Loan advanced by such Lender on such Advance Date, the date and
amount of each continuation or conversion of such Loan, the length of each
Interest Period with respect thereto and the date and amount of each payment of
principal and/or interest relating thereto; provided, that the failure to make
any such recordation shall not affect the obligation of Trustee under the Notes
or the corresponding obligation of Lessee to pay Rent. In all events, prior to
any transfer of its Note, a Lender shall indicate in writing to its transferee
the date, amount and maturity of each Loan made by it which is still outstanding
and the amounts of accrued but unpaid interest thereon.
SECTION 2.3. Procedure for Borrowing.
(a) Subject to the terms and conditions of the Participation
Agreement and this Loan Agreement, Borrower shall borrow under the Commitments
on the Advance Date upon receipt by Agent from Lessee of the Advance Request in
accordance with Section 2.4(a) of the Participation Agreement.
(b) The Advance Request shall be delivered to Trustee, Agent
and Lenders in accordance with Section 2.4 of the Participation Agreement. Each
Lender will fund its pro rata share of the Advance in accordance with Section
2.2 of the Participation Agreement.
SECTION 2.4. Prepayments; Lease Termination Payments and
Premium.
(a) Borrower shall repay in full the unpaid principal amount
of each Loan (including any Additional Costs) upon the Final Maturity Date.
(b) On each Scheduled Principal Payment Date, Borrower shall
make a mandatory repayment of a portion of the outstanding principal amount of
each Note in an amount determined pursuant to Section 2.12 of the Participation
Agreement.
(c) No other principal amortization of the Loans will be
required prior to the Final Maturity Date thereof, except that upon the
occurrence of (i) a Casualty that results in a purchase by Lessee of the
Equipment suffering the Casualty, (ii) Lessee exercising the early termination
option to purchase all of the Equipment pursuant to Section 5.1 of the Lease or
(iii) a Lease Event of Default that results in Lessor exercising its right to
have Lessee purchase all of the Equipment, Borrower shall prepay the aggregate
outstanding principal amount of the Loans or in the event of a Casualty, an
amount equal to the Casualty Item Amount, together with interest accrued to the
date of such prepayment on the principal amount so prepaid, plus, Additional
Costs, if any.
(d) In the event that Lessee elects to exercise the early
termination option to purchase all of the Equipment pursuant to Section 5.1 of
the Lease after the first anniversary of the Lease Commencement Date, Lessee
shall pay to Agent for the account of Lenders a premium (the "Premium") in an
amount equal to one percent of the amount of such prepayment.
SECTION 2.5. Interest Rates. The Loans shall accrue interest at the
applicable Interest Rate from time to time in effect. The Interest Period for
which a LIBO Rate applies shall be three months unless the duration is shortened
as required by the definition of "Interest Period." Interest accrued on each
Loan shall be payable in arrears on each Payment Date.
If all or a portion of the principal amount of or interest on the Notes
shall not be paid when due (whether at the Final Maturity Date thereof, by
acceleration or otherwise), such
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overdue amount shall, without limiting the rights of any Lender under Section
6.2, bear interest at the Overdue Rate, in each case from the date first due
until paid in full (as well after as before judgment) payable on demand.
SECTION 2.6. Determination of Interest Rate.
(a) During such time as a LIBO Rate applies to any of the
Notes, interest in respect of such Notes shall be calculated on the basis of a
360 day year and the actual days elapsed. During such time as the Alternate Base
Rate applies to any of the Notes, interest in respect of such Notes shall be
calculated on the basis of a 365 (or 366, as applicable) day year and the actual
number of days elapsed. Agent shall, as soon as practicable, but in no event
later than 12:00 noon, Las Vegas, Nevada time, one Business Day prior to the
first day of each Interest Period, notify Borrower, who shall notify Lessee and
Lenders, of the LIBO Rate. Any change in the Interest Rate on the Loans
resulting from a change in the Alternate Base Rate shall become effective as of
the opening of business on the day on which such Alternate Base Rate changes as
provided herein.
(b) Except as provided in Section 2.10 or Section 2.13, all
Loans shall be LIBO Rate Loans. LIBO Rate Loans shall be made by each Lender at
its LIBOR Office. At the end of each Interest Period, all LIBO Rate Loans shall
automatically be continued.
SECTION 2.7. Pro Rata Treatment among Loans. Except as otherwise
expressly set forth in Article III, each payment (including each prepayment) by
Borrower on account of principal of and interest on the Loans shall be made pro
rata among the Loans. Agent shall apply any prepayments in reduction of Loans so
that Borrower's funding losses under Section 2.12 are minimized. All payments
(including prepayments) to be made by Borrower hereunder and under the Notes
shall be made without set-off or counterclaim and shall be made to Agent, for
the account of Lenders, at Agent's office referred to in Schedule III of the
Participation Agreement, in lawful money of the United States of America and in
immediately available funds. Agent shall distribute such payments to each Lender
at its LIBOR Office, promptly upon receipt in like funds as received.
SECTION 2.8. Payment from Trust Estate Only. All payments to be made by
Borrower in respect of the Loans and this Loan Agreement shall be made only from
the income and the proceeds from the Trust Estate and only to the extent that
Borrower shall have received sufficient income or proceeds from the Trust Estate
to make such payments in accordance with the terms of Article III. Each Lender
agrees that it will look solely to the income and proceeds from the Trust Estate
to the extent available for distribution to such Lender as herein provided and
that neither Borrower nor Agent is or shall be personally liable to any Lender
for any amount payable hereunder or under any Note except as specifically
provided for in the Trust Agreement or the Participation Agreement.
SECTION 2.9. Taxes.
(a) Any and all payments by Borrower to each Lender or Agent
under this Loan Agreement and any other Operative Document shall be made free
and clear of, and without deduction or withholding for any Taxes. In addition,
Borrower shall pay all Other Taxes.
(b) Borrower agrees to indemnify and hold harmless each Lender
and Agent for the full amount of Taxes or Other Taxes (including any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this Section)
paid by Lenders or Agent and any liability(including penalties, interest,
additions to tax and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
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Payment under this indemnification shall be made within 30 days after the date a
Lender or Agent makes written demand therefor.
(c) If Borrower shall be required by law to deduct or withhold
any Taxes or Other Taxes from or in respect of any sum payable hereunder to any
Lender or Agent, then:
(I) THE SUM PAYABLE SHALL BE INCREASED AS NECESSARY SO THAT
AFTER MAKING ALL REQUIRED DEDUCTIONS AND WITHHOLDINGS (INCLUDING
DEDUCTIONS AND WITHHOLDINGS APPLICABLE TO ADDITIONAL SUMS PAYABLE UNDER
THIS SECTION) SUCH LENDER OR AGENT, AS THE CASE MAY BE, RECEIVES AN
AMOUNT EQUAL TO THE SUM IT WOULD HAVE RECEIVED HAD NO SUCH DEDUCTIONS
OR WITHHOLDINGS BEEN MADE;
(II) BORROWER SHALL MAKE SUCH DEDUCTIONS AND WITHHOLDINGS;
(III)BORROWER SHALL PAY THE FULL AMOUNT DEDUCTED OR WITHHELD
TO THE RELEVANT TAXING AUTHORITY OR OTHER AUTHORITY IN ACCORDANCE WITH
APPLICABLE LAW; AND
(IV) BORROWER SHALL ALSO PAY TO AGENT FOR THE ACCOUNT OF EACH
LENDER, AT THE TIME INTEREST IS PAID, ALL ADDITIONAL AMOUNTS WHICH THE
RESPECTIVE LENDER SPECIFIES AS NECESSARY TO PRESERVE THE AFTER-TAX
YIELD LENDER WOULD HAVE RECEIVED IF SUCH TAXES OR OTHER TAXES HAD NOT
BEEN IMPOSED.
(d) Within 30 days after the date of any payment by Borrower
of Taxes or Other Taxes, Borrower shall furnish Agent the original or a
certified copy of a receipt evidencing payment thereof, or other evidence of
payment satisfactory to Agent.
(e) If Borrower is required to pay additional amounts to any
Lender or Agent pursuant to subsection (c) of this Section, then such Lender
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to change the jurisdiction of its Lending Office so as to eliminate any such
additional payment by Borrower which may thereafter accrue, if such change in
the judgment of such Lender is not otherwise disadvantageous to such Lender.
SECTION 2.10. Illegality.
(a) If any Lender determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has asserted
that it is unlawful, for any Lender or its applicable Lending Office to make
LIBO Rate Loans, then, on notice thereof by Lender to Borrower through Agent,
any obligation of that Lender to make LIBO Rate Loans shall be suspended until
Lender notifies Agent and Borrower that the circumstances giving rise to such
determination no longer exist.
(b) If a Lender determines that it is unlawful to maintain any
LIBO Rate Loan, Borrower shall, upon its receipt of notice of such fact and
demand from such Lender (with a copy to Agent), prepay in full such LIBO Rate
Loans of that Lender then outstanding, together with interest accrued thereon,
either on the last day of the Interest Period thereof, if Lender may or lawfully
continue to maintain such LIBO Rate Loans to such day, immediately, if Lender
may not lawfully continue to maintain such LIBO Rate Loans. If Borrower is
required to so prepay any LIBO Rate Loan, then concurrently with such
prepayment, Borrower shall borrow from the affected Lender, in the amount of
such repayment, an Alternate Base Rate Loan.
SECTION 2.11. Increased Costs and Reduction of Return.
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(a) If any Lender determines that, due to either (i) the
introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance by that Lender with any guideline or request
from any central bank or other Governmental Authority (whether or not having the
force of law), there shall be any increase in the cost of such Lender of
agreeing to make or making, funding or maintaining any LIBO Rate Loans, then
Borrower shall be liable for, and shall from time to time, upon demand (with a
copy of such demand to be sent to Agent), pay to Agent for the account of such
Lender, additional amounts as are sufficient to compensate such Lender for such
increased costs.
(b) If any Lender shall have determined that (i) the
introduction of any Capital Adequacy Regulation, (ii) any change in any Capital
Adequacy Regulation, (iii) any change in the interpretation or administration of
any Capital Adequacy Regulation by any central bank or other Governmental
Authority charged with the interpretation or administration thereof, or (iv)
compliance by such Lender (or its Lending Office) or any corporation controlling
such Lender with any Capital Adequacy Regulation, affects or would affect the
amount of capital required or expected to be maintained by such Lender or any
corporation controlling such Lender and (taking into consideration such Lender's
or such corporation's policies with respect to capital adequacy and such
Lender's desired return on capital) determines that the amount of such capital
is increased as a consequence of its Commitments, Loans, credits or obligations
under this Loan Agreement, then, upon demand of such Lender to Borrower through
Agent, Borrower shall pay to such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender for such
increase.
SECTION 2.12. Funding Losses. Borrower shall reimburse each Lender and
hold each Lender harmless from any loss or expense which such Lender may sustain
or incur as a consequence of:
(a) the failure of Borrower to make on a timely basis any
payment of principal of any LIBO Rate Loan;
(b) the failure of Borrower to borrow, continue or convert a
Loan after Borrower has given (or is deemed to have given) the Advance Request;
(c) the failure of Borrower to make any prepayment;
(d) the prepayment or other payment (including after
acceleration thereof) of a LIBO Rate Loan on a day that is not the last day of
the relevant Interest Period; or
(e) the automatic conversion of any LIBO Rate Loan to an
Alternate Base Rate Loan on a day that is not the last day of the relevant
Interest Period; including any such loss or expense arising by reason of the
liquidation or reemployment of deposits or other funds obtained by it to make,
continue or maintain its LIBO Rate Loans or from fees payable to terminate the
deposits from which such funds were obtained; provided, however, that such
Lender shall have delivered to Borrower a certificate as to the amount of such
loss or expense, which certificate shall be conclusive in the absence of
manifest error.
SECTION 2.13. Inability to Determine Rates. If Agent determines that
for any reason adequate and reasonable means do not exist for determining the
LIBO Rate for any requested Interest Period with respect to a proposed LIBO Rate
Loan, or that the LIBO Rate applicable for any requested Interest Period with
respect to a proposed LIBO Rate Loan does not adequately and fairly reflect the
cost to Lenders of funding such Loan, Agent will promptly so notify Borrower and
each Lender. Thereafter, the obligation of Lenders to make or maintain LIBO Rate
Loans hereunder shall be suspended until Agent revokes such notice in writing.
Upon
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receipt of such notice, Borrower may revoke the Advance Request submitted by it.
If Borrower does not revoke such notice, Lenders shall make, convert or continue
the Loans, as proposed by Borrower, in the amount specified in the applicable
notice submitted by Borrower, but such Loans shall be made, converted or
continued as Alternate Base Rate Loans instead of LIBO Rate Loans.
SECTION 2.14. Survival. The agreements and obligations of Borrower in
this Article II shall survive the payment of all other obligations.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME
FROM THE TRUST ESTATE
SECTION 3.1. Rent Distribution. Except as otherwise provided in Section
3.3 hereof, each payment of Rent as well as any payment of interest on overdue
installments of Rent under the Lease, and any other monies paid over by Lessee
or Borrower to Agent for such purpose, shall be distributed as promptly as
possible (it being understood that any payments of Rent received by or on behalf
of Agent under the Lease on a timely basis and in accordance with the provisions
of the Lease shall be distributed on the date received in the funds so received)
in the following order of priority:
first, an amount equal to the aggregate amount of the payment
of interest as well as any interest on (to the extent permitted by
Applicable Law) overdue interest then due and payable on the Notes
shall be distributed and paid to Lenders; and
second, an amount equal to the aggregate amount of the payment
of principal on the Notes then due and payable shall be distributed and
paid to Lenders.
SECTION 3.2. Distribution of Mandatory Prepayments.
(a) Except as otherwise provided in Section 3.2(b) and Section
3.3, the amount of any prepayment received pursuant to Section 2.4 (other than
any Premium paid pursuant to Section 2.4(d)) shall in each case be distributed
and paid in the following order of priority:
FIRST, AN AMOUNT EQUAL TO THE AGGREGATE AMOUNT OF ACCRUED
INTEREST (AS WELL AS ANY INTEREST ON (TO THE EXTENT PERMITTED BY
APPLICABLE LOANS) OVERDUE INTEREST) THEN DUE AND PAYABLE ON THE NOTES,
PLUS ADDITIONAL COSTS, IF ANY, SHALL BE DISTRIBUTED AND PAID TO
LENDERS; AND
SECOND, AN AMOUNT EQUAL TO THE AGGREGATE AMOUNT OF THE PAYMENT
OF PRINCIPAL ON THE NOTES THEN DUE AND PAYABLE SHALL BE DISTRIBUTED AND
PAID TO LENDERS.
(b) Any Casualty Recovery or Non-Casualty Recovery that is not
required to be paid to Lessee pursuant to the Lease, solely because a Lease
Default or Lease Event of Default exists shall be held by Trustee as security
for the obligations of Lessee under the Lease and the other Operative Documents
and invested in Cash Equivalents and at such time as there shall not be
continuing any such Lease Default or Lease Event of Default, such portion shall
be paid to Lessee, unless Agent (as assignee of Borrower) shall have theretofore
declared the Lease to be
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terminated pursuant to Section 10.2 thereof, in which event such portion shall
be distributed forthwith upon such declaration in accordance with the provisions
of Section 3.3 hereof.
SECTION 3.3. Distribution of Payments After Loan Event of Default.
(a) Except as otherwise provided in Section 3.4(b), all
payments received and amounts (other than Excluded Amounts) realized by Agent
after a Loan Event of Default shall have occurred and be continuing, as well as
all payments or amounts then held or thereafter received by Agent as part of the
Trust Estate while such Loan Event of Default shall be continuing, shall be
distributed forthwith by Agent in the following order of priority:
FIRST, SO MUCH OF SUCH PAYMENTS OR AMOUNTS AS SHALL BE
REQUIRED TO REIMBURSE AGENT OR TRUSTEE FOR ANY TAX, EXPENSE OR OTHER
LOSS INCURRED BY AGENT OR TRUSTEE (TO THE EXTENT NOT PREVIOUSLY
REIMBURSED AND TO THE EXTENT INCURRED IN CONNECTION WITH ITS DUTIES AS
AGENT OR TRUSTEE, RESPECTIVELY) AND ANY UNPAID ONGOING FEES OF AGENT
SHALL BE DISTRIBUTED TO AGENT;
SECOND, SO MUCH OF SUCH PAYMENTS OR AMOUNTS AS SHALL BE
REQUIRED TO REIMBURSE THE THEN EXISTING OR PRIOR LENDERS (SO LONG AS
THE LOAN EVENTS OF DEFAULT THAT HAVE OCCURRED AND ARE CONTINUING ARISE
SOLELY FROM A LEASE EVENT OF DEFAULT) FOR PAYMENTS MADE BY THEM TO
AGENT OR TRUSTEE PURSUANT TO SECTION 7.7 (TO THE EXTENT NOT PREVIOUSLY
REIMBURSED), AND TO PAY SUCH THEN EXISTING OR PRIOR LENDERS (SO LONG AS
THE LOAN EVENTS OF DEFAULT THAT HAVE OCCURRED AND ARE CONTINUING ARISE
SOLELY FROM A LEASE EVENT OF DEFAULT) THE AMOUNTS PAYABLE TO THEM
PURSUANT TO ANY EXPENSE REIMBURSEMENT OR INDEMNIFICATION PROVISIONS OF
THE PARTICIPATION AGREEMENT, THE LEASE OR THIS LOAN AGREEMENT, SHALL BE
DISTRIBUTED TO EACH SUCH PERSON, WITHOUT PRIORITY OF ONE OVER THE
OTHER, IN ACCORDANCE WITH THE AMOUNT OF SUCH PAYMENT OR PAYMENTS
PAYABLE TO EACH SUCH PERSON;
THIRD, SO MUCH OF SUCH AMOUNT AS SHALL BE REQUIRED TO PAY IN
FULL THE AGGREGATE UNPAID PRINCIPAL AMOUNT OF THE NOTES, TOGETHER WITH
ANY ADDITIONAL COSTS AND THE ACCRUED BUT UNPAID INTEREST ON THE NOTES
TO THE DATE OF DISTRIBUTION SHALL BE DISTRIBUTED TO LENDERS HOLDING
NOTES, AND IN THE CASE THE AMOUNT SO TO BE DISTRIBUTED SHALL BE
INSUFFICIENT TO PAY IN FULL AS AFORESAID, THEN, PRO RATA AMONG SUCH
LENDERS, WITHOUT PRIORITY OF ONE SUCH LENDER OVER THE OTHER, IN THE
PROPORTION THAT THE UNPAID PRINCIPAL AMOUNT OF THE NOTES HELD BY EACH
LENDER BEARS TO THE AGGREGATE UNPAID PRINCIPAL AMOUNT OF THE NOTES;
FOURTH, THE BALANCE, IF ANY, OF SUCH PAYMENTS OR AMOUNTS
REMAINING THEREAFTER SHALL BE PROMPTLY DISTRIBUTED TO, OR AS DIRECTED
BY, BORROWER.
(b) During the occurrence and continuance of any Loan Event of
Default, all amounts (other than Excluded Amounts) received or realized by Agent
and otherwise distributable pursuant to Section 3.1 or 3.2 shall be distributed
as provided in Section 3.3 (a).
SECTION 3.4. Other Payments.
(a) Any payments received by Agent for which no provision as
to the application thereof is made in the Operative Documents or elsewhere in
this Article III shall be distributed forthwith by Agent in the order of
priority set forth in Section 3.1.
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(b) All payments received and amounts realized by Agent under
the Lease or otherwise with respect to the Equipment to the extent received or
realized at any time after payment in full of the principal of and interest on
all Loans, as well as any other amounts remaining as part of the Trust Estate
after payment in full of the principal of and interest on (and any Additional
Costs in respect of) all Loans issued hereunder, shall be distributed forthwith
by Agent in the order of priority set forth in Section 3.3(a) omitting clause
"third" of such Section 3.3(a).
(c) Except after a Loan Event of Default has occurred and is
continuing, any payment received by Agent for which provision as to the
application thereof is made in an Operative Document but not elsewhere in this
Article III shall be distributed forthwith by Agent to the Person for the
purpose for which such payment was made in accordance with the terms of such
Operative Document.
SECTION 3.5. Distribution of Excluded Amounts. All amounts
constituting Excluded Amounts received by Agent shall be distributed to the
Person or Persons entitled thereto.
SECTION 3.6. Guaranty Payments. Any payment received by Agent from
Guarantor pursuant to the Guaranty shall be distributed forthwith or retained by
Trustee in the same manner and subject to the same conditions as provided in
this Article III with respect to payments received by Trustee in respect of
Borrower's obligation as to which such payment relates, all as if such payment
had been made by Borrower out of Rent received under the Lease.
ARTICLE IV
CONDITIONS PRECEDENT
The agreement of each Lender to make the Loan requested to be made by
it on the Advance Date is subject to the satisfaction on the Advance Date of the
applicable conditions precedent set forth in Article III of the Participation
Agreement.
ARTICLE V
AFFIRMATIVE COVENANTS OF BORROWER
SECTION 5.1. Performance by Borrower. Subject to Section 2.8, so long
as any Note remains outstanding and unpaid or any other amount is owing to any
Lender hereunder, Borrower will promptly pay all amounts payable by it under
this Loan Agreement and the Notes in accordance with the terms hereof and
thereof and shall duly perform each of its obligations under this Loan Agreement
and the Notes.
SECTION 5.2. Waiver by Borrower.
(a) To the extent permitted by Applicable Law, Borrower is
hereby deemed to have irrevocably waived:
(I) THE PROTECTION OF ANY STAY (AUTOMATIC OR OTHERWISE)
ARISING OUT OF OR IN CONNECTION WITH ANY PROCEEDINGS FOR THE
REORGANIZATION OR LIQUIDATION OF BORROWER UNDER THE BANKRUPTCY CODE OR
OTHERWISE OF THE EXERCISE BY LENDERS OR AGENT OF RIGHTS AND REMEDIES
UNDER THE OPERATIVE DOCUMENTS; AND
(II) ANY RIGHT THAT BORROWER MIGHT OTHERWISE HAVE TO ENJOIN,
LIMIT OR
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RESTRICT THE GOOD FAITH EXERCISE OF SUCH RIGHTS AND REMEDIES.
(b) To the extent permitted by Applicable Law, Lenders and
Agent are hereby expressly relieved from any obligation to comply with any such
stay which might otherwise affect their exercise at any time of such rights and
remedies.
ARTICLE VI
LOAN EVENTS OF DEFAULT; REMEDIES
SECTION 6.1. Loan Events of Default. Each of the following events shall
constitute a "Loan Event of Default" (whether any such event shall be voluntary
or involuntary or come about or be effected by operation of law or pursuant to
or in compliance with any judgment, decree or order of any court or any order,
rule or regulation of any governmental authority) and each such Loan Event of
Default shall continue so long as, but only as long as, it shall not have been
remedied:
(a) Borrower shall fail to pay any principal of or interest on
any Note when due and such failure shall continue for a period of 3 Business
Days; or
(b) the failure by Borrower in any material respect to timely
perform any other covenant or condition herein or in any other Operative
Document to which Borrower is a party and such failure shall continue for a
period of 30 days after written notice thereof to Borrower and Lessee from
Agent; or
(c) any representation or warranty by Borrower in any
Operative Document or in any certificate or document delivered thereunder shall
have been incorrect in a material respect when made and shall remain material
when discovered and if curable shall continue for a period of 30 days after
written notice thereof to Borrower and Lenders from Agent; or
(d) the filing by Borrower of any petition for dissolution or
liquidation of Borrower; or the commencement by Borrower of a voluntary case
under any applicable bankruptcy, insolvency or other similar law for the relief
of debtors, foreign or domestic, now or hereafter in effect; or Borrower shall
have consented to the entry of an order for relief in an involuntary case under
any such law; or the failure of Borrower generally to pay, or the admission by
Borrower in writing that it is unable to pay, its debts as such debts become due
(within the meaning of the Bankruptcy Code); or the failure by Borrower promptly
to satisfy or discharge any execution, garnishment or attachment of such
consequence as will impair its ability to carry out its obligations under the
Operative Documents; or the appointment of or taking possession by a receiver,
custodian or trustee (or other similar official) for Borrower or any substantial
part of its property; or a general assignment by Borrower for the benefit of
creditors; or the entry by Borrower into an agreement of composition with its
creditors; or Borrower shall have taken any corporate action in furtherance of
any of the foregoing; or the filing against Borrower of an involuntary petition
in bankruptcy which results in an order for relief being entered or,
notwithstanding that an order for relief has not been entered, the petition is
not dismissed within 60 days of the date of the filing of the petition; or the
filing under any law relating to bankruptcy, insolvency or relief of debtors of
any petition against Borrower which either (i) results in a finding or
adjudication of insolvency of Borrower or (ii) is not dismissed within 60 days
of the date of the filing of such petition; or
(e) a Lease Event of Default shall occur and be continuing.
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SECTION 6.2. Remedies.
(a) Upon the occurrence of a Loan Event of Default hereunder,
(i) if such event is a Loan Event of Default specified in clause (d) of Section
6.1 or clauses (f) or (g) of Section 10.1 of the Lease, automatically the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Loan Agreement and the Notes shall immediately become due and payable, and (ii)
if such event is any other Loan Event of Default, upon the written instructions
of the Required Lenders, Agent shall, by notice of default to Borrower, declare
the Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Loan Agreement and the Notes to be due and payable forthwith,
whereupon the same shall immediately become due and payable; provided that the
sole remedies of Agent upon the occurrence of a Loan Event of Default specified
in clause (b), (c) (but only to the extent the representation was made in
Borrower's individual capacity) or (d) of Section 6.1 that does not also
constitute a Lease Event of Default shall be to cause Lenders to remove and
replace Borrower as Trustee and to bring suit against Borrower for damages.
Except as expressly provided above in this Article VI, presentment, demand,
protest and all other notices of any kind are hereby expressly waived.
(b) Upon the occurrence of any Loan Event of Default and at
any time thereafter so long as any Loan Event of Default shall be continuing,
subject to Applicable Law, Agent may, and upon the written instructions of the
Required Lenders shall, exercise any or all of the rights and powers and pursue
any and all of the remedies available to it hereunder and (subject to the terms
thereof) under the other Operative Documents, the Lease and the Guaranty and
shall have and may exercise any and all rights and remedies available under the
Uniform Commercial Code or any provision of law.
(c) Upon the occurrence of any Loan Event of Default and at
any time thereafter so long as any Loan Event of Default shall be
continuing, subject to Applicable Law, Agent may proceed to protect and enforce
this Loan Agreement, the Notes, the other Operative Documents, the Lease and the
Guaranty by suit or suits or proceedings in equity, at law or in bankruptcy, and
whether for the specific performance of any covenant or agreement herein
contained or in execution or aid of any power herein granted, or for foreclosure
hereunder, or for the appointment of a receiver or receivers for the Equipment,
or for the recovery of judgment for the indebtedness secured thereby or for the
enforcement of any other proper, legal or equitable remedy available under
Applicable Law.
(d) Borrower shall be liable for any and all accrued and
unpaid amounts due hereunder before, after or during the exercise of any of the
foregoing remedies, including all reasonable legal fees and other reasonable
costs and expenses incurred by Agent or any Lender by reason of the occurrence
of any Loan Event of Default or the exercise of remedies with respect thereto.
(e) Except as expressly provided above, no remedy under this
Section 6.2 is intended to be exclusive, but each shall be cumulative and in
addition to any other remedy provided under this Section 6.2 or under the other
Operative Documents or otherwise available at law or in equity. The exercise by
Agent or any Lender of any one or more of such remedies shall not preclude the
simultaneous or later exercise of any other remedy or remedies. No express or
implied waiver by Agent or any Lender of any Loan Event of Default shall in any
way be, or be construed to be, a waiver of any future or subsequent Loan Event
of Default. The failure or delay of Agent or any Lender in exercising any rights
granted it hereunder upon any occurrence
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LOAN AGREEMENT
of any of the contingencies set forth herein shall not constitute a waiver of
any such right upon the continuation or recurrence of any such contingencies or
similar contingencies and any single or partial exercise of any particular right
by Agent or any Lender shall not exhaust the same or constitute a waiver of any
other right provided herein.
(f) No failure to exercise and no delay in exercising, on the
part of Agent or any Lender, any right, remedy, power or privilege hereunder,
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
ARTICLE VII
AGENT
SECTION 7.1. Appointment and Authorization. Each Lender hereby
irrevocably (subject to Section 7.9) appoints, designates and authorizes Agent
to take such action on its behalf under the provisions of this Loan Agreement
and to exercise such powers and perform such duties as are expressly delegated
to Agent by the terms of this Loan Agreement and the other Operative Documents,
together with such powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary contained elsewhere in this Loan Agreement or in
any other Operative Document, Agent shall not have any duties or
responsibilities, except those expressly set forth herein or in any other
Operative Document, nor shall Agent have or be deemed to have any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Loan Agreement or any other Operative Document or otherwise exist against Agent.
SECTION 7.2. Delegation of Duties. Agent may execute any of its duties
under this Loan Agreement or any other Operative Document by or through agents
(including the Trust Company), employees or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
Agent shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
SECTION 7.3. Liability of Agent. None of Agent-Related Persons shall
(i) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Loan Agreement or any other Operative Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct or as otherwise provided in the Security Agreement), or (ii) be
responsible in any manner to any of Lenders for any recital, statement,
representation or warranty made by Borrower or any Subsidiary or Affiliate of
Borrower, or any officer thereof, contained in this Loan Agreement or in any
other Operative Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by Agent under or in
connection with, this Loan Agreement or any other Operative Document, or for the
value of or title to any Collateral, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Loan Agreement or any other
Operative Document, or for any failure of Borrower or any other party to any
Operative Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Loan Agreement or any other Operative
Document, or to inspect the
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LOAN AGREEMENT
properties, books or records of Borrower or any of Borrower's Subsidiaries or
Affiliates.
SECTION 7.4. Reliance by Agent.
(a) Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to Borrower),
independent accountants and other experts selected by Agent. Agent shall be
fully justified in failing or refusing to take any action under this Loan
Agreement or any other Operative Document unless it shall first receive such
advice or concurrence of the Required Lenders as it deems appropriate and, if it
so requests, it shall first be indemnified to its satisfaction by Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Loan
Agreement or any other Operative Document in accordance with a request and any
action taken upon consent of the Required Lenders and such request and any
action taken or failure to act pursuant thereto shall be binding upon all of
Lenders.
(b) Each Lender that has executed this Loan Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by Agent to such Lender for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to Lender.
SECTION 7.5. Notice of Default. Agent shall not be deemed to have
knowledge or notice of the occurrence of any Loan Default or Loan Event of
Default, except with respect to defaults in the payment of principal, interest
and fees required to be paid to Agent directly for the account of Lenders,
unless Agent shall have received written notice from a Lender or Lessee
referring to this Loan Agreement, describing such Loan Default or Loan Event of
Default and stating that such notice is a "notice of default." Agent will notify
Lenders of its receipt of any such notice. Agent shall take such action with
respect to such Loan Default or Loan Event of Default as may be requested by the
Required Lenders; provided, however, that unless and until Agent has received
any such request, Agent may (but shall not be obligated to) take such action
regarding such Loan Default or Loan Event of Default as it shall deem advisable
or in the best interest of Lenders.
SECTION 7.6. Credit Decision. Each Lender acknowledges that none of
Agent-Related Persons has made any representation or warranty to it, and that no
act by Agent hereinafter taken, including any review of the affairs of Parent,
Lessee and its Subsidiaries, shall be deemed to constitute any representation or
warranty by any Agent-Related Person to any Lender. Each Lender represents to
Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of any investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of
Parent, Lessee and its Subsidiaries, the value of and title to any Collateral,
and all applicable bank regulatory laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Loan Agreement
and to extend credit to Borrower and Lessee hereunder. Each Lender also
represents that it will independently and without reliance upon any
Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this
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LOAN AGREEMENT
Loan Agreement and the other Operative Documents, and to make such
investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of Lessee and Parent. Except for notices, reports and other
documents expressly herein required to be furnished to Lenders by Agent, Agent
shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of Lessee and Parent which may
come into the possession of any of Agent-Related Persons.
SECTION 7.7. Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, Lenders shall indemnify upon demand any
Agent-Related Person (to the extent not reimbursed by or on behalf of Lessee and
without limiting the obligation of Lessee to do so), pro rata, from and against
any and all Indemnified Liabilities; provided, however, that no Lender shall be
liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities resulting solely from such Person's gross negligence or
willful misconduct. Without limitation of the foregoing, each Lender shall
reimburse Agent upon demand for its ratable share of any costs or out-of-pocket
expenses (including attorney costs) incurred by Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Loan
Agreement, any other Operative Document, or any document contemplated by or
referred to herein, to the extent that Agent is not reimbursed for such expenses
by or on behalf of Borrower. The undertaking in this Section shall survive the
payment of all obligations hereunder and the resignation or replacement of
Agent.
SECTION 7.8. Agent in Individual Capacity. ▇▇▇▇▇▇ Financial Leasing,
Inc. and its Affiliates may make loans to, issue letters of credit for the
account of, acquire equity interests in and generally engage in any kind of
business with Parent, its Subsidiaries and Affiliates as though ▇▇▇▇▇▇ Financial
Leasing, Inc. were not Agent hereunder and without notice to or consent of
Lenders. The Lenders acknowledge that, pursuant to such activities, ▇▇▇▇▇▇
Financial Leasing, Inc. or its Affiliates may receive information regarding
Parent or its Affiliates (including information that may be subject to
confidentiality obligations in favor of Parent or such Affiliate) and
acknowledge that Agent shall be under no obligation to provide such information
to them. With respect to its Loans, ▇▇▇▇▇▇ Financial Leasing, Inc. shall have
the same rights and powers under this Loan Agreement as any other Lender and may
exercise the same as though it were not Agent, and the terms "Lender" and
"Lenders" include ▇▇▇▇▇▇ Financial Leasing, Inc. in its individual capacity.
SECTION 7.9. Successor Agent. Agent may, and at the request of the
Required Lenders shall, resign as Agent upon 30 days' notice to Lenders. If
Agent resigns under this Agreement, the Required Lenders shall appoint from
among Lenders a successor agent for Lenders. If no successor agent is appointed
prior to the effective date of the resignation of Agent, Agent may appoint,
after consulting with Lenders and Borrower, a successor agent from among
Lenders. Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor agent and the
retiring Agent's appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions. of
this Article VII shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Agent under this Agreement. If no successor agent
has accepted appointment as Agent by
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LOAN AGREEMENT
the date which is 30 days following a retiring Agent's notice of resignation,
the retiring Agent's resignation shall nevertheless thereupon become effective
and Lenders shall perform all of the duties of Agent hereunder until such time,
if any, as the Required Lenders appoint an successor agent as provided for
above.
SECTION 7.10. Withholding Tax.
(a) If any Lender is a "foreign corporation, partnership or
trust" within the meaning of the Code and such Lender claims exemption from, or
a reduction of U.S. withholding tax under Sections 1441 or 1442 of the Code,
such Lender agrees with and in favor of Agent, to deliver to Agent:
(I) IF SUCH LENDER CLAIMS AN EXEMPTION FROM, OR A REDUCTION
OF, WITHHOLDING TAX UNDER A UNITED STATES TAX TREATY, PROPERLY
COMPLETED IRS FORMS 1001 AND W-8 BEFORE THE PAYMENT OF ANY INTEREST IN
THE FIRST CALENDAR YEAR AND BEFORE THE PAYMENT OF ANY INTEREST IN EACH
THIRD SUCCEEDING CALENDAR YEAR DURING WHICH INTEREST MAY BE PAID UNDER
THIS LOAN AGREEMENT;
(II) IF SUCH LENDER CLAIMS THAT INTEREST PAID UNDER THIS LOAN
AGREEMENT IS EXEMPT FROM UNITED STATES WITHHOLDING TAX BECAUSE IT IS
EFFECTIVELY CONNECTED WITH A UNITED STATES TRADE OR BUSINESS OF SUCH
LENDER, TWO PROPERLY COMPLETED AND EXECUTED COPIES OF IRS FORM 4224
BEFORE THE PAYMENT OF ANY INTEREST IS DUE IN THE FIRST TAXABLE YEAR OF
SUCH LENDER AND IN EACH SUCCEEDING TAXABLE YEAR OF SUCH LENDER DURING
WHICH INTEREST MAY BE PAID UNDER THIS LOAN AGREEMENT; AND
(III) SUCH OTHER FORM OR FORMS AS MAY BE REQUIRED UNDER THE
CODE OR OTHER LAWS OF THE UNITED STATES AS A CONDITION TO EXEMPTION
FROM, OR REDUCTION OF, UNITED STATES WITHHOLDING TAX.
Such Lender agrees to promptly notify Agent of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.
(b) If any Lender claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form 1001 and
such Lender sells, assigns, grants a participation in, or otherwise transfers
all or part of the obligations of Borrower to such Lender, such Lender agrees to
notify Agent of the percentage amount in which it is no longer the beneficial
owner of obligations of Borrower to such Lenders. To the extent of such
percentage amount, Agent will treat such Lender's IRS Form 1001 as no longer
valid.
(c) If any Lender claiming exemption from United States
withholding tax by filing IRS Form 4224 with Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the obligations of
Borrower to such Lender, such Lender agrees to undertake sole responsibility for
complying with the withholding tax requirements imposed by Sections 1441 and
1442 of the Code.
(d) If any Lender is entitled to a reduction in the applicable
withholding tax, Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable withholding tax after taking into account
such reduction. If the forms or other documentation required by subsection (a)
of this Section are not delivered to Agent, then Agent may withhold from any
interest payment to such Lender not providing such forms or other documentation
an amount equivalent to the applicable withholding tax.
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LOAN AGREEMENT
(e) If the IRS or any other Governmental Authority of the
United States or other jurisdiction asserts a claim that Agent did not properly
withhold tax from amounts paid to or for the account of any Lender (because the
appropriate form was not delivered, was not properly executed, or because such
Lender failed to notify Agent of a change in circumstances which rendered the
exemption from, or deduction of, withholding tax ineffective, or for any other
reason) such Lender shall indemnify Agent fully for all amounts paid, directly
or indirectly, by and including any taxes imposed by any jurisdiction on the
amounts payable to Agent under this Section, together with all costs and
expenses (including attorney costs and the allocated cost of internal legal
counsel services and all disbursements of internal counsel). The obligation of
Lenders under this subsection shall survive the payment of all obligations and
the resignation or replacement of Agent.
SECTION 7.11. Concerning the Trust Estate.
(a) Agent accepts the agency applicable to it and agrees to
cause the Trust Company (or its successor) to receive all payments and proceeds
pursuant to the Operative Documents and disburse such payments or proceeds in
accordance with the Operative Documents.
(b) Upon discharge of the indebtedness secured by the Security
Documents or security interest or Lien provided therein, Agent shall execute and
deliver, at Lessee's cost and expense, such satisfactions and terminations of
said Liens as may be required. Upon satisfaction of the Lien or security
interest provided for in any such instrument, such instrument shall be deemed
withdrawn from the Collateral.
(c) In the event that the Required Lenders shall notify Agent
that an event of default under a security instrument has occurred, Agent shall
take such action with respect thereto as the Required Lenders may require by
written instructions, but Agent shall not be required to take any action not
expressly set forth in such written instructions.
(d) Agent shall not have any duty or obligation to manage,
operate, control, use, sell, dispose of or otherwise deal with the Equipment or
any other part of the Collateral or to otherwise take or refrain from taking any
action under, or in connection with, the security instruments, except as
expressly provided by the terms of this Loan Agreement or as expressly provided
in written instructions from the Required Lenders received pursuant to the terms
of Section 7.11(c) hereof.
(e) Except in accordance with written instruction furnished
pursuant to Section 7.11(c) hereof, and without limiting the generality of
Section 7.11(d) hereof, Agent shall have no duty (i) to see to any recording,
filing or depositing of any security instrument or amendment thereof, (ii) to
see to any insurance on the Equipment or to effect or maintain any such
insurance, (iii) to see to the payment or discharge of any tax, assessment, or
other governmental charge or any Lien or encumbrance of any kind owing with
respect to, assessed or levied against, any part of the Trust Estate or
Collateral, (iv) to confirm or verify any notices or reports of Lessee other
than to furnish (to the extent not otherwise furnished) Lenders with a copy of
each notice or report furnished to Agent by Lessee pursuant to a security
instrument or (v) to inspect the Equipment at any time or ascertain or inquire
as to the performance or observance of Lessee's covenants under any security
instrument.
(f) In accepting the agency hereby created, Agent acts solely
as Agent hereunder and not in its individual capacity, and all persons, other
than Lenders, having any claim against Agent by reason of the transactions
contemplated hereby shall look only to the
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LOAN AGREEMENT
Trust Estate for payment or satisfaction thereof.
(g) The agency created hereby shall be terminated by notice
given by Agent to Lenders at any time upon the final disposition of all
Collateral and the final distribution by Agent of all monies or other property
or proceeds received pursuant to the Operative Documents in accordance with
their terms.
SECTION 7.12. Distribution and Receipt of Payments by Trust Company.
Agent, for the benefit of Lenders, hereby appoints the Trust Company as the
agent of Lenders for purposes of receiving proceeds of Advances, payments under
the Lease and making distributions to Lenders, Lessee and other Persons under
this Loan Agreement. Agent may at any time by notice in writing terminate the
Trust Company's appointment hereby as agent of collection and payment of the
payments under the Lease, in which event Lessee, upon receipt of copy of such
notice, shall pay any and all payments payable to Agent hereunder and under the
other Operative Documents directly to Agent at the account set forth in Schedule
III of the Participation Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1. Amendments and Waivers. Neither this Loan Agreement, any
Note nor any terms hereof or thereof may be amended, supplemented or modified
except in accordance with the provisions of the Participation Agreement.
SECTION 8.2. Notices. Unless otherwise specified herein, all notices,
requests, demands or other communications to or upon the respective parties
hereto shall be delivered in accordance with, and shall be deemed to have been
given as provided in, Section 9.3 of the Participation Agreement; provided, that
any notice, request, demand or other communication to or upon Agent or Lenders
pursuant to Section 2.3 shall not be effective until received.
SECTION 8.3. Successors and Assigns; Transfers and Participations.
(a) This Loan Agreement shall be binding upon and inure to the
benefit of Borrower, Lenders, Agent, all future holders of the Notes and their
respective successors and assigns.
(b) Any transfer by a Lender of its Note or any sale by a
Lender of any participating interest in the Loans evidenced by its Note shall
comply with Sections 6.2, 6.3 and 6.4 of the Participation Agreement. Any Lender
transferring its Note shall pay, or cause the transferee to pay, the costs and
expenses (including reasonable counsel fees) incurred by Agent in connection
with such transfer.
SECTION 8.4. Counterparts. This Loan Agreement may be executed by one
or more of the parties to this Loan Agreement on any number of separate
counterparts and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Loan
Agreement signed by all the parties hereto shall be lodged with Borrower and
Agent.
SECTION 8.5. GOVERNING LAW. THIS LOAN AGREEMENT AND THE NOTES HAVE BEEN
DELIVERED IN, AND THIS LOAN AGREEMENT AND THE NOTES AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS LOAN AGREEMENT AND THE NOTES SHALL IN ALL
RESPECTS BE GOVERNED
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LOAN AGREEMENT
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEVADA, EXCLUDING
CHOICE OF LAWS AND CONFLICT OF LAWS RULES OF SUCH STATE.
SECTION 8.6. Survival and Termination of Agreement. All covenants,
agreements, representations and warranties made herein and in any certificate,
document or statement delivered pursuant hereto or in connection herewith shall
survive the execution and delivery of this Loan Agreement and the Notes and
shall continue in full force and effect so long as any Note or any amount
payable to any Lender under or in connection with this Loan Agreement or the
Notes is unpaid, at which time this Loan Agreement shall terminate, it being
expressly understood that the obligations of Borrower, as the case may be, to
Agent and each Lender under Article II and the obligations of Lenders to Agent
under Section 7.7 shall survive the payment in full of the Notes.
SECTION 8.7. Entire Agreement. This Loan Agreement sets forth the
entire agreement of the parties hereto with respect to its subject matter, and
supersedes all previous understandings, written or oral, with respect thereto.
SECTION 8.8. Severability. Any provision of this Loan Agreement or of
the Notes which is prohibited, unenforceable or not authorized in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition, unenforceability or non-authorization without invalidating the
remaining provisions hereof or thereof or affecting the validity, enforceability
or legality of any such provision in any other jurisdiction.
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LOAN AGREEMENT
[Signature pages follow]
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LOAN AGREEMENT
IN WITNESS WHEREOF, the parties hereto have caused this Loan Agreement
to be duly executed and delivered by their proper and duly authorized officers
as of the day and year first above written.
FIRST SECURITY TRUST
COMPANY OF NEVADA, not in
its individual capacity,
except as expressly
provided herein, but solely
as Trustee and as Borrower
By:
Name:
Title:
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LOAN AGREEMENT
▇▇▇▇▇▇ FINANCIAL LEASING, INC., as
Agent and as Lender
By:
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
A-118
24
LOAN AGREEMENT
PHOENIXCOR, INC., as Lender
By:
Name:
Title:
A-119
25
LOAN AGREEMENT
SCHEDULE I
TO
LOAN AGREEMENT
LENDERS
Lenders Commitment Commitment
Percentage
▇▇▇▇▇▇ Financial Leasing, Inc. $ 8,000,000 80
Phoenixcor, Inc. 2,000,000 20
TOTAL $ 10,000,000 100%
26
LOAN AGREEMENT
EXHIBIT A
TO LOAN AGREEMENT
FORM OF NOTE
NOTE NO. ___
U.S. $___________
Dated May __, 1999
FOR VALUE RECEIVED, the undersigned, FIRST SECURITY TRUST COMPANY OF
NEVADA, not in its individual capacity but solely as Trustee under the Trust
Agreement for Lenders named therein ("Borrower"), promises to pay to the order
of [NAME OF LENDER), ("Lender"), the principal sum of $ United
States Dollars or, if less, the aggregate unpaid principal amount of all Loans
made by Lender to, or for the benefit of, Borrower, or purchased by Lender, as
recorded either on the grid attached to this Note or in the records of Lender;
provided, however, that the failure to make any such recordation or any error in
such recordation shall not in any way affect Borrower's obligation to repay this
Note. The principal amount of each Loan evidenced hereby shall be payable on or
prior to the Final Maturity Date as provided in that certain Loan Agreement,
dated as of May 28, 1999, among Borrower, ▇▇▇▇▇▇ Financial Leasing, Inc., a
Delaware corporation, as agent ("Agent"), and the various lenders named therein
(the "Loan Agreement").
Borrower also promises to pay interest, on the unpaid principal amount
hereof from time to time outstanding at the rates per annum, on the dates
specified in, and in accordance with the terms of the Loan Agreement.
Payments of both principal and interest are to be made in lawful money of
the United States of America in same day or immediately available funds to the
account designated by Lender pursuant to the Loan Agreement.
This Note is one of the Notes referred to in, and evidences indebtedness
incurred under, the Loan Agreement, to which reference is made for a statement
of the terms and conditions on which Borrower is required to make prepayments
and repayments of principal of the indebtedness evidenced by this Note and on
which such indebtedness may be declared to be immediately due and payable.
Capitalized terms used herein without definition shall have the meanings
provided in the Loan Agreement. This Note is secured pursuant to the Security
Documents made by Borrower in favor of Agent referred to in the Loan Agreement
and reference is hereby made to the Loan Agreement and such Security Documents
for a statement of the terms and provisions of such security.
Anything to the contrary herein notwithstanding, Borrower's liability for
any sums due hereunder shall be limited in accordance with Section 2.8 of the
Loan Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest, and notice of dishonor, notice
of the existence, creation or nonpayment of all or any of the Loans and all
other notices whatsoever.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEVADA EXCLUDING ALL CHOICE OF LAWS AND CONFLICT OF LAWS RULES OF
SUCH STATE.
[signature page follows)
27
LOAN AGREEMENT
IN WITNESS WHEREOF, Trustee has caused this Note to be executed in its
corporate name by its duly authorized officer as of the date hereof.
FIRST SECURITY TRUST COMPANY OF NEVADA,
not in its individual capacity but solely as
Trustee, as Borrower
By:
Name:
Title:
A-122
28
LOAN AGREEMENT
A-4
29
LOAN AGREEMENT
GRID ATTACHED TO NOTE
DATED MAY , 1999 OF
--
FIRST SECURITY TRUST COMPANY OF NEVADA
AS TRUSTEE
PAYABLE TO THE ORDER OF [INSERT LENDER'S NAME]
Loans made by Lender to Trustee, as Borrower, and payments of principal of such
Loans.
-----------------------------------------------------------------------------------------------------------------------------------
Principal Principal Amount Interest
Amount Bearing paid
--------------- -------------------------- --------------------
Interest
Date Advances Period Base Rate LIBO Rate Base LIBO Principal Notation
(If Applicable) Rate Rate Amount Total Made By
--------- ---------------- ----------------------- -------------- ---------- --------- --------- ------------ --------------
--------- ---------------- ----------------------- -------------- ---------- --------- --------- ------------ --------------
--------- ---------------- ----------------------- -------------- ---------- --------- --------- ------------ --------------
--------- ---------------- ----------------------- -------------- ---------- --------- --------- ------------ --------------
--------- ---------------- ----------------------- -------------- ---------- --------- --------- ------------ --------------
--------- ---------------- ----------------------- -------------- ---------- --------- --------- ------------ --------------
--------- ---------------- ----------------------- -------------- ---------- --------- --------- ------------ --------------
30
LOAN AGREEMENT
AMORTIZATION SCHEDULE ATTACHED TO NOTE
DATED MAY __, 1999 OF
FIRST SECURITY TRUST COMPANY OF NEVADA
AS TRUSTEE
PAYABLE TO THE ORDER OF [INSERT LENDER'S NAME]
Principal
Date Repayment ▇▇▇▇▇▇
▇-▇