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GUARANTY AND PLEDGE AGREEMENT
Dated as of May 20, 1998
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MA 1994 B SHARES, L.P.
As Guarantor
CITIBANK, N.A.
As Trustee
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Table Of Contents
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ARTICLE 1. DEFINITIONS AND INCORPORATION
BY REFERENCE...............................................1
Section 1.1 Definitions..........................................1
Section 1.2 Incorporation by Reference...........................6
Section 1.3 Rules of Construction................................6
ARTICLE 2. GUARANTY...................................................7
Section 2.1 Guaranty of the Guaranteed Obligations...............7
Section 2.2 Liability of Guarantor...............................9
Section 2.3 Waivers by Guarantor................................10
Section 2.4 Subordination of Other Obligations..................11
Section 2.5 Authority of Guarantor, BPL, MHLP, Etc..............11
Section 2.6 Rights Cumulative...................................12
Section 2.7 Bankruptcy; Reinstatement of Guaranty...............12
Section 2.8 Subordinated Loans..................................13
Section 2.9 Reduction of Cost Overrun Guaranty..................13
ARTICLE 3. SECURITY..................................................16
Section 3.1 Grant of Security Interest..........................16
Section 3.2 Delivery of Guarantor Collateral,
Certificates; Custodial Agent.......................16
Section 3.3 Maintenance of Perfected Security Interest..........16
Section 3.4 Maintenance of Collateral Coverage Ratio............17
Section 3.5 Registration........................................18
Section 3.6 Voting Rights.......................................18
Section 3.7 Dividends and Distributions.........................18
Section 3.8 Care of Guarantor Collateral........................18
Section 3.9 Power of Attorney...................................18
Section 3.10 Partial Release of Guarantor Collateral............19
Section 3.11 Return of Guarantor Collateral.....................19
Section 3.12 Consents, Notices, Reports under Custody Agreement.19
ARTICLE 4. REPRESENTATIONS AND WARRANTIES............................20
Section 4.1 Existence; Compliance with Law......................20
Section 4.2 Power; Authorization; Enforceable Obligations.......20
Section 4.3 Financial Condition.................................20
Section 4.4 No Legal Bar........................................21
Section 4.5 No Material Litigation..............................21
Section 4.6 No Guaranty Default.................................21
Section 4.7 Organizational Documents............................21
Section 4.8 Taxes...............................................21
Section 4.9 Representations and Warranties Respecting the
Guarantor Collateral................................22
Section 4.10 Net Worth..........................................22
Section 4.11 Unencumbered Liquid Assets.........................22
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ARTICLE 5. AFFIRMATIVE COVENANTS.....................................22
Section 5.1 Financial Statements................................22
Section 5.2 Certificates; Other Information.....................23
Section 5.3 Payment of Obligations..............................23
Section 5.4 Compliance with Applicable Law
and Contractual Obligations.........................23
Section 5.5 Legal Existence of Guarantor........................23
Section 5.6 Title Curative Proceedings..........................24
Section 5.7 Notices.............................................24
Section 5.8 Covenants Respecting the Guarantor Collateral.......24
Section 5.9 Fees of Custodial Agent.............................24
ARTICLE 6. NEGATIVE COVENANTS........................................24
Section 6.1 Net Worth...........................................24
Section 6.2 Unencumbered Liquid Assets..........................25
Section 6.3 Liens...............................................25
ARTICLE 7. DEFAULTS AND REMEDIES.....................................25
Section 7.1 Events of Default...................................25
Section 7.2 Remedies in General.................................26
Section 7.3 Procedures With Respect to Sale
of the Guarantor Collateral.........................27
Section 7.4 Expenses and Interest...............................27
ARTICLE 8. MISCELLANEOUS.............................................28
Section 8.1 Further Assurances..................................28
Section 8.2 No Subrogation......................................28
Section 8.3 Authority of Trustee................................28
Section 8.4 No Waiver...........................................29
Section 8.5 Notices.............................................29
Section 8.6 Governing Law.......................................30
Section 8.7 Submission To Jurisdiction, Waivers.................30
Section 8.8 Successors and Assigns..............................31
Section 8.9 Severability........................................31
Section 8.10 Counterpart Originals..............................31
Section 8.11 Table of Contents, Headings, etc...................32
Section 8.12 Amendments.........................................32
Exhibit A - Form of Guarantor Subordinated Loan Certificate
Exhibit B - Form of Release Certificate
Exhibit C - Form of Guaranteed Amount Certificate
Schedule 4.3(c) - Change in Financial Condition
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GUARANTY AND PLEDGE AGREEMENT
This Guaranty and Pledge Agreement dated as of May 20, 1998 is
entered into by MA 1994 B SHARES, L.P., a Delaware limited partnership
("Guarantor"), in favor of CITIBANK, N.A. (the "Trustee"), a national banking
association, as Trustee for the Holders (as defined below) pursuant to the
Indenture (as defined below).
Basketball Properties, Ltd., a Florida limited partnership ("BPL"),
has issued its 6.65% Senior Term Notes due 2025 (Series A-1-A) in the aggregate
principal amount of $90,200,000, its 6.65% Senior Term Notes due 2025 (Series
A-1-B) in the aggregate principal amount of $30,000,000, its 6.80% Senior Term
Notes due 2025 (Series A-2) in the aggregate principal amount of $50,000,000 and
its 6.21 % Senior Notes due 2005 (Series B) in the aggregate principal amount of
$14,697,000 (collectively, the "Notes") pursuant to that certain Indenture dated
as of May 20, 1998 (the "Indenture").
The Notes and certain other obligations of BPL under the Indenture
and the other Note Documents (as defined below) have been guaranteed by Miami
Heat Limited Partnership, a Florida limited partnership ("MHLP"), on the terms
set forth in the Indenture.
In connection with the Notes, MBIA Insurance Corporation, a New York
stock insurance corporation ("MBIA"), is issuing the Note Insurance Policies,
the County Payment Surety Bond and the Debt Service Reserve Surety Bond, each as
defined in the Indenture.
Guarantor has agreed to guarantee certain obligations of BPL and
MHLP to the Trustee and the Holders on the terms and conditions set forth in
this Agreement.
Guarantor agrees as follows for the benefit of the Trustee and MBIA
and for the equal and ratable benefit of the Holders:
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.1 Definitions.
"Additional Known Costs" means, as of any date of determination, the
cost of all work and other items, other than Punch List Items, that must be
accomplished in order to fully and finally complete the construction and
equipping of the Project in accordance with the Plans and Specifications, the
requirements of the NBA and Applicable Law.
"Agreement" means this Guaranty and Pledge Agreement.
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"BPL Delay Debt Service" means principal of and interest on the
Series A-1 Notes and the Series A-2 Notes accruing from and including February
1, 2000 and through the earlier of February 1, 2001 and the date of Substantial
Completion (as defined in the Construction Contract).
"BPL Delay Debt Service Drawing" means a claim made under this
Agreement in respect of the BPL Delay Debt Service Obligations pursuant to
Section 10.04 of the Deposit and Disbursement Agreement.
"BPL Delay Debt Service Obligations" means, as of any date of
determination, all obligations of BPL to pay BPL Delay Debt Service reduced by
the amount AMEC PLC and Construtora ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ are obligated to pay, as
of such date of determination, in respect of principal and interest on the Notes
under the Contractor Delay Debt Service Guaranty.
"Carnival Corporation" means Carnival Corporation, a corporation
organized and existing under the laws of the Republic of Panama.
"Cash or Cash Equivalents" means (a) cash on hand; (b)
dollar-denominated demand deposits maintained in the United States with any
commercial bank and dollar-denominated time deposits maintained in the United
States with, or certificates of deposits having, a maturity of one year or less
issued by any commercial bank which has its head office in the United States and
which has a combined capital and surplus of at least $100,000,000; (c) direct
obligations of, or obligations unconditionally guaranteed by, the United States
of America and having a maturity of one year or less; (d) readily marketable
commercial paper having a maturity of one year or less, issued by any
corporation organized and existing under the laws of the United States or any
state thereof or the District of Columbia and rated by S&P or Moody's (or, if
neither such organization shall rate such commercial paper at any time, rated by
any nationally recognized rating organization in the United States) with the
highest rating assigned by such organization; (e) repurchase agreements which
(i) are callable at any time or have a maturity date of one year or less, (ii)
are entered into with any commercial bank which has its head office in the
United States and has a combined capital and surplus of at least $100,000,000
and (iii) are secured by direct obligations of, or obligations unconditionally
guaranteed by, the United States and having a maturity of one year or less; and
(f) mutual funds which invest exclusively in direct obligations of, or
obligations unconditionally guaranteed by, the United States and having a
maturity of one year or less.
"COI Drawing" means a claim made under this Agreement in respect of
the COI Obligations pursuant to Section 10.03(c) of the Deposit and Disbursement
Agreement.
"COI Obligations" means an amount owing under the Notes and the
other Note Documents equal, as of any date of determination, to the COI
Requirement.
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"Collateral Coverage Call" means a notice pursuant to Section 7(c)
of the Custody Agreement that the Collateral Coverage Ratio is less than 1.5 to
1.0.
"Collateral Coverage Ratio" means, on any date of determination, the
ratio of (a) the Market Value to (b) the Guaranteed Amount.
"Contingency Amount" has the meaning specified in the last paragraph
of Section 2.9(b).
"Cost Overrun Drawing" means a claim made under this Agreement in
respect of the Cost Overrun Obligations pursuant to Section 10.03(b) of the
Deposit and Disbursement Agreement.
"Cost Overrun Obligations" means (a) all obligations of BPL to
deposit cash with the Trustee pursuant to Section 5.01(b)(ii) of the Deposit and
Disbursement Agreement, whether in respect of Construction Costs, costs of
environmental remediation in connection with the Project, liabilities arising
under the Environmental Indemnity or otherwise and (b) the obligation of BPL to
pay the principal of and interest on the Notes that is due after the last day on
which BPL Delay Debt Service is payable.
"Custodial Agent" means Prudential Securities Incorporated, a
Delaware corporation, acting in its capacity as Custodian pursuant to, and as
the term "Custodian" is defined in, the terms of the Custody Agreement, and its
successors in such capacity.
"Custody Agreement" means that certain Custody Agreement dated as of
the Closing Date between the Trustee and the Custodial Agent, as it may be
amended or supplemented from time to time.
"Equity Obligations" means the obligation of BPL to deliver the
Remaining Cash Equity (excluding payments under Sections 5.1.2 and 5.1.3 of the
Naming Rights Agreement) to the Trustee for deposit pursuant to the Deposit and
Disbursement Agreement.
"Equity Drawing" means a claim made under this Agreement in respect
of the Equity Obligations pursuant to Section 10.03(a) of the Deposit and
Disbursement Agreement.
"Forecasted Project Costs" means, as of any date of determination,
BPL's forecasted amount necessary for the construction of the Arena determined
on the basis used for determining the forecasted project costs set forth in the
forecasted sources and uses of funds Section of the Offering Memorandum for the
Notes dated May 15, 1998.
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"Guaranteed Amount" means an amount equal, as of any date of
determination, to the amount determined pursuant to Section 2.1(c) or (d).
"Guaranteed Amount Certificate" has the meaning specified for that
term in Section 5.2(c).
"Guaranteed Obligations" means the Equity Obligations, the BPL Delay
Debt Service Obligations, the Cost Overrun Obligations and the COI Obligations.
"Guarantor" has the meaning specified for that term in the preamble
to this Agreement.
"Guarantor Collateral" means all of the following property of
Guarantor, whether now owned or hereafter acquired:
(a) The shares of the Class A common stock of Carnival
Corporation which have been deposited by Guarantor with the Custodial Agent to
be held by the Custodial Agent for the Trustee pursuant to the Custody Agreement
and for the benefit of MBIA and for the equal and ratable benefit of the Holders
together with stock powers executed in blank covering such shares (collectively
the "Initial Guarantor Collateral");
(b) any securities accounts or securities entitlements
relating to the foregoing; and
(c) subject to Section 3.7, all dividends, distributions,
money and other property of any kind paid or distributed in respect of or in
exchange for, and all other proceeds of, any or all of the foregoing.
"Guarantor Subordinated Loan" has the meaning specified for that
term in Section 2.8.
"Guarantor Subordinated Loan Certificate" has the meaning specified
for that term in Section 2.8.
"Guaranty Default" means any event that is, or with the passage of
time or the giving of notice or both would be, a Guaranty Event of Default.
"Guaranty Event of Default" has the meaning set forth in Section 7.1
hereof.
"Indenture" means that certain Indenture dated as of the Closing
Date and providing for the issuance of the Notes.
"Initial Guarantor Collateral" has the meaning specified for that
term in the definition of "Guarantor Collateral."
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"Market Value" has the meaning specified for that term in the
Custody Agreement.
"Material Adverse Effect" means any material adverse effect on the
validity, perfection or priority of the Liens of the Trustee on the Guarantor
Collateral.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., a Delaware
corporation.
"Net Worth" means, with respect to Guarantor, as of any date of
determination, the market value of the publicly-traded securities owned by
Guarantor on such date plus all Cash or Cash Equivalents owned by Guarantor as
of such date.
"Notes" has the meaning specified for that term in the preamble to
this Agreement.
"Officer's Certificate" means a certificate signed on behalf of
Guarantor by the President, any Vice President or Chief Financial Officer of the
general partner of Guarantor; provided, however, that any Officer's Certificate
required to be delivered pursuant to Section 5.2 shall be signed on behalf of
the Chief Financial Officer of such general partner.
"Permitted Liens" means Liens in favor of the Trustee created by
this Agreement.
"Punch List Items" means all items listed on the "punch list"
referred to in clause (a) of the definition of Construction Completion in the
Indenture and described in the Officer's Certificate referred to in clause (b)
of the definition of Construction Completion.
"Qualified Carnival Stock" means, with respect to Guarantor, shares
of Carnival Corporation's Class A common stock which (a) have been held at all
times, for purposes of satisfying Rule 144 promulgated under the Securities Act,
by Guarantor for more than two (2) years prior to the date such stock is
deposited with the Custodial Agent pursuant to the terms of this Agreement; (b)
the full purchase price or other consideration therefor was paid or given by
such Guarantor more than two (2) years prior to the date such stock is deposited
with the Custodial Agent pursuant to the terms of this Agreement, all within the
meaning of, and as required by, Rules 144(d) and 144(k) promulgated under the
Securities Act; and (c) subject to no restrictions other than the restrictions
imposed by Rule 144 solely by reason of Guarantor being an affiliate (as defined
in Rule 144) of Carnival Corporation.
"Release Certificate" has the meaning specified for that term in
Section 3.11.
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"S&P" means Standard & Poor's Rating Group, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., a New York corporation.
"Termination Date" means the first date on which the Guaranteed
Amount has been reduced to zero pursuant to Section 2.1.
"Trustee" has the meaning specified for that term in the Indenture.
"UCC" means the Uniform Commercial Code or any successor thereto, as
now or hereafter in effect under the law applicable to this Agreement.
"Unencumbered Liquid Assets" means (a) Qualified Carnival Stock, (b)
Cash and Cash Equivalents and (c) other readily marketable securities acceptable
to MBIA in its sole discretion, which, in the case of any of the foregoing, as
of any date of determination, are (i) owned by Guarantor, (ii) not subject to
any Lien or claim (including restrictions on transferability or assignability
other than any restrictions on transfer by Guarantor imposed under Rule 144
promulgated under the Securities Act solely by reason of a Guarantor being an
affiliate (as defined in such Rule 144) of the issuer of any such securities) of
any kind, (iii) not subject to any agreement which limits the ability of
Guarantor to create, incur, assume or suffer to exist any Lien upon any of such
assets, and (iv) not subject to any agreement which entitles any Person to the
benefit of any Lien on such assets or which would entitle any Person to the
benefit of any Lien on any such assets upon the occurrence of any contingency.
The Guarantor Collateral shall not constitute Unencumbered Liquid Assets.
"Unfunded Additional Known Costs" has the meaning specified in
Section 2.9(b)(ii).
Section 1.2 Incorporation by Reference.
Capitalized terms used in this Agreement and not otherwise defined
have the meanings given to those terms in the Indenture.
Section 1.3 Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in Accordance with GAAP;
(c) words in the singular include the plural, and in the plural
include the singular;
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(d) provisions apply to successive events and transactions; and
(e) references to sections of or rules under the Securities Act, UCC
and other statutes shall be deemed to include substitute, replacement or
successor sections or rules promulgated by the SEC or any other applicable
Governmental Authority from time to time.
(f) the words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall, unless otherwise expressly
specified, refer to this Agreement as a whole and not to any particular
provision of this Agreement, and all references to Sections shall be references
to Sections of this Agreement unless otherwise expressly specified;
(g) unless otherwise expressly specified, any agreement, contract or
document defined or referred to herein shall mean such agreement, contract or
document in the form (including all amendments, schedules, exhibits, appendices,
attachments, clarification letters and the like relating thereto) delivered to
the Trustee on the Closing Date, if so delivered, as the same may thereafter be
amended, supplemented or otherwise modified from time to time in accordance with
the terms of such agreement, contract or document, this Agreement and the other
Note Documents;
(h) unless otherwise stated, any reference in this Agreement to any
Person shall include its permitted successors and assigns and, in the case of
any Governmental Authority, any Person succeeding to its functions and
capacities;
(i) whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms;
(j) the words "include," "includes" and "including" shall not be
limiting, and shall be deemed in all instances to be followed by the phrase
"without limitation"; and
(k) references to "days" shall mean calendar days, unless otherwise
indicated.
ARTICLE 2.
GUARANTY
Section 2.1 Guaranty of the Guaranteed Obligations.
(a) Guarantor hereby irrevocably and unconditionally guarantees,
until the Termination Date, the due and punctual payment in fill of all
Guaranteed Obligations when the same shall become due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or otherwise
(including amounts that would become due but for the operation of Bankruptcy
Law).
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(b) Drawings may be made by the Trustee under this Agreement
pursuant to and subject to the terms of Article 10 of the Deposit and
Disbursement Agreement.
(c) As of the Closing Date, the amount guaranteed hereunder (the
"Guaranteed Amount") is $83,385,850.21, calculated as follows:
Equity Obligations $46,863,665.53
BPL Delay Debt Service Obligations 6,021,184.68
Cost Overrun Obligations 30,501,000.00
COI Obligations 0.00
Guaranteed Amount $83,385,850.21
(d) After the Closing Date, the Guaranteed Amount shall be subject
to reduction from time to time as follows:
(i) The Equity Obligations shall be reduced, as of any date of
determination, (A) to an amount equal to (x) the amount of Remaining Cash Equity
as of such date minus (y) the amount of payments due under Sections 5.1.2 and
5.1.3 of the Naming Rights Agreement that have not been paid as of such date and
(B) by the amount of each Equity Drawing (but without duplication of any amounts
taken into account in the reduction of Remaining Cash Equity).
(ii) The BPL Delay Debt Service Obligations shall be reduced
by (A) each payment of BPL Delay Debt Service made by BPL and (B) the amount of
each BPL Delay Debt Service Drawing (but without duplication of any amounts
taken into account in the foregoing clause (A)).
(iii) The Cost Overrun Obligations shall be reduced by (i) by
the amount of each Cost Overrun Drawing, (ii) any amount thereof which has been
paid to the Trustee in respect of Cost Overrun Obligations from the proceeds of
Subordinated Loans as certified by the Guarantor to the Trustee in a
Subordinated Loan Certificate and (iii) any amount by which the Cost Overrun
Obligations have been reduced pursuant to Section 2.9.
(iv) The COI Obligations shall be reduced (A) to equal the
amount of the COI Requirement as of any date of determination and (B) by the
amount of any COI Drawing.
A reduction in the Guaranteed Amount shall be deemed to take effect at such time
as Guarantor has delivered the Guaranteed Amount Certificate pursuant to Section
5.2(c) or, in the case of the Cost Overrun Obligations, the certificates
required pursuant to Section 2.9(a), (b), (c) or (d), as applicable. Upon any
reduction of the Guaranteed
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Amount, the Trustee shall deliver to the Custodial Agent and MBIA written notice
of the new Guaranteed Amount, as so reduced.
Section 2.2 Liability of Guarantor.
Guarantor agrees that Guarantor's obligations under this Agreement
are irrevocable, absolute, independent and unconditional and shall not be
affected by any circumstance which constitutes a legal or equitable discharge of
a guarantor or a surety other than the occurrence of the Termination Date. In
furtherance of the foregoing and without limiting the generality thereof,
Guarantor agrees as follows:
(a) This Agreement is an absolute and unconditional guaranty of
payment when due and not of collectibility.
(b) The obligations of Guarantor hereunder are independent of the
obligations of BPL and MHLP under the Notes, the Indenture and the other Note
Documents and of the obligations of any other guarantor of, or any other party
liable for, the Guaranteed Obligations or any part thereof, and a separate
action or actions may be brought and prosecuted against Guarantor whether or not
any action is brought against BPL, MHLP or any such other guarantor or other
party and whether or not BPL, MHLP or any such other guarantor or other party is
joined in any such action or actions.
(c) Guarantor's payment of a portion, but not all, of the Guaranteed
Obligations shall in no way limit, affect, modify or abridge Guarantor's
liability for any portion of the Guaranteed Obligations which has not been paid
in full.
(d) Upon such terms as it deems appropriate, without notice or
demand, and without affecting the validity or enforceability of this Agreement
or giving rise to any reduction, limitation, impairment, discharge or
termination of Guarantor's liability hereunder, the Trustee, at the direction or
with the consent of the Majority Holders, as applicable, may from time to time
(i) renew, extend, accelerate, or otherwise change the time, place, manner or
terms of payment of the Guaranteed Obligations, (ii) settle, compromise, release
or discharge, or accept or refuse any offer of performance with respect to, or
substitutions for, the Guaranteed Obligations or any agreement relating thereto
and/or subordinate the payment of the same to the payment of any other
obligations, (iii) request and accept other guaranties of the Guaranteed
Obligations and take and hold security for the payment of this Agreement or the
Guaranteed Obligations, (iv) release, surrender, exchange, substitute, fail to
perfect, compromise, settle, rescind, waive, alter, subordinate or modify, with
or without consideration, any security for payment of the Guaranteed
Obligations, any other guaranties of the Guaranteed Obligations, or any other
obligation of any person or entity with respect to the Guaranteed Obligations
and (v) exercise any other rights available under the Notes, the Indenture, the
other Note Documents or Applicable Law.
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(e) This Agreement and the obligations of Guarantor hereunder shall
be valid and enforceable and shall not be subject to any impairment, discharge,
delay or termination for any reason (other than the limitations and reductions
provided for in this Agreement), including without limitation the occurrence of
any of the following, whether or not Guarantor shall have had notice or
knowledge of any of them: (i) any failure or omission to assert or enforce, or
agreement or election not to assert or enforce, or the stay or enjoining, by
order of court, by operation of law or otherwise, of the exercise or enforcement
of, any claim or demand or any right, power or remedy (whether arising under the
Notes, the Indenture, the other Note Documents, at law, in equity or otherwise)
with respect lo the Guaranteed Obligations or any agreement relating thereto, or
with respect to any other guaranty of or security for the payment of the
Guaranteed Obligations, (ii) any rescission, waiver, amendment or modification
of, or any consent to departure from, any of the terms or provisions (including
without limitation provisions relating to events of default) of any of the
Notes, the Indenture, the other Note Documents, or any agreement or instrument
executed pursuant thereto, or of any other guaranty or security for the
Guaranteed Obligations, in each case whether or not in accordance with the terms
of the Notes, the Indenture, the other Note Documents, or any agreement relating
to such other guaranty or security, (iii) the consent by the Trustee, MBIA or
the Holders, to the change, reorganization or termination of the organizational
structure or existence of BPL or MHLP or to any corresponding restructuring of
the Guaranteed Obligations, (iv) any amendment or waiver of, any consent given
under or any action taken or any omission to act with respect to any of the
terms or provisions of the Note Documents, and (v) any other act or thing or
omission, or delay to do any other act or thing, which might in any manner or to
any extent vary the risk of Guarantor as an obligor in respect of the Guaranteed
Obligations.
Section 2.3 Waivers by Guarantor.
Except as specifically provided to the contrary in this Agreement,
Guarantor waives, for the benefit of the Trustee, the Custodial Agent, MBIA and
the Holders:
(a) any right to require the Trustee, the Custodial Agent, MBIA or
the Holders, as a condition of payment or performance by Guarantor, to (i)
except as otherwise provided in the Deposit and Disbursement Agreement, proceed
against BPL, MHLP, any other guarantor of or party liable for the Guaranteed
Obligations, or any other person or entity, (ii) proceed against or exhaust any
security held from BPL, MHLP, any other guarantor of or other party liable for
the Guaranteed Obligations, or any other Person, or (iii) pursue any other
remedy in the power of the Trustee, the Custodial Agent, MBIA or the Holders
whatsoever against any Person;
(b) any defense Guarantor may have based upon any election of
remedies by the Trustee, the Custodial Agent, MBIA or the Holders which destroys
Guarantor's subrogation rights or rights to proceed against BPL, MHLP or any
other Person for reimbursement, including without limitation, any loss of rights
Guarantor
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may suffer by reason of any rights, powers or remedies of BPL or MHLP in
connection with any anti-deficiency laws or any other laws limiting, qualifying
or discharging BPL's or MHLP's indebtedness or Guarantor's remedies against RPL,
MHLP or any other Person;
(c) any defense based upon the acts or omissions of the Trustee, the
Custodial Agent, MBIA or the Holders in the administration of the Guaranteed
Obligations, including but not limited to any act or omission which directly or
indirectly results in or contributes to the discharge of any of the Guaranteed
Obligations;
(d) (i) any principles or provisions of law, statutory or otherwise,
which are or might be in conflict with the terms of this Agreement and any legal
or equitable discharge of Guarantor's obligations hereunder, (ii) any rights to
offsets or recoupments and (iii) promptness, diligence and any requirement that
the Trustee, the Custodial Agent, MBIA or the Holders, protect, secure, perfect
or insure any Lien or any property subject thereto;
(e) notices (except those expressly provided for in this Agreement),
demands, presentments, protests, notices of protest, notices of dishonor and
notices of any action or inaction, including acceptance of this Agreement, or
any agreement or instrument related thereto, and notices of any of the matters
referred to in Section 2.2 and any right to consent to any thereof; and
(f) to the fullest extent permitted by Applicable Law, any defenses
or benefits that may be derived from or afforded by Applicable Law which limit
the liability of or exonerate guarantors or sureties, or which may conflict with
the terms of this Agreement.
Section 2.4 Subordination of Other Obligations.
Any and all indebtedness of BPL, MHLP or any other Person liable for
any of the Guaranteed Obligations now or hereafter held by Guarantor (including
all Subordinated Loans and all rights of subrogation, indemnity, reimbursement
and contribution) is hereby subordinated in right of payment to the Guaranteed
Obligations, and any such indebtedness of BPL, MHLP or any such other Person to
Guarantor collected or received by a Guarantor after a Guaranty Event of Default
has occurred and is continuing shall be held in trust for the Trustee and shall
promptly be paid over to the Trustee, but without affecting, impairing or
limiting in any manner the liability of Guarantor under any other provision of
this Agreement.
Section 2.5 Authority of Guarantor, BPL, MHLP, Etc.
It is not necessary for the Trustee, the Custodial Agent or the
Holders to inquire at any time into the capacity or powers of Guarantor, BPL,
MHLP, any
12
trustee or beneficiary of Guarantor, or the partners, officers, directors or any
agents acting or purporting to act on behalf of any of the foregoing.
Section 2.6 Rights Cumulative.
The rights, powers and remedies given to the Trustee, the Custodial
Agent, MBIA and the Holders by this Agreement and the Custody Agreement are
cumulative and shall be in addition to and independent of all rights, powers and
remedies given to any thereof by virtue of any Applicable Law or in any of the
Notes, the Indenture or the other Note Documents. Any forbearance or failure to
exercise, and any delay by the Trustee, the Custodial Agent, MBIA or the Holders
in exercising, any right, power or remedy hereunder shall not impair any such
right, power or remedy or be construed to be a waiver thereof, nor shall it
preclude the further exercise of any such right, power or remedy.
Section 2.7 Bankruptcy; Reinstatement of Guaranty.
(a) So long as any Guaranteed Obligations remain outstanding,
Guarantor shall not, without the prior written consent of MBIA, commence or join
with any other person or entity in commencing any bankruptcy, reorganization or
insolvency proceedings of or against BPL or MHLP. The obligations of Guarantor
under this Agreement shall not be reduced, limited, impaired, discharged,
deferred, suspended or terminated by any proceeding, voluntary or involuntary,
involving the bankruptcy, insolvency, receivership, reorganization, liquidation
or arrangement of BPL or MHLP or by any defense which BPL or MHLP may have by
reason of the order, decree or decision of any court or administrative body
resulting from any such proceeding.
(b) The Guaranteed Obligations and the Guaranteed Amount shall be
determined without regard to any Applicable Law which may relieve BPL, MHLP or
any other Person of any portion of the Guaranteed Obligations.
(c) In the event that all or any portion of the Guaranteed
Obligations are paid by BPL, MHLP or any other Person prior to the Termination
Date, the obligations of Guarantor under this Agreement, including but not
limited to Articles 2, 3, 4 and 5, shall continue and remain in full force and
effect or be reinstated, as the case may be, in the event that all or any part
of such payment or payments are rescinded or recovered directly or indirectly
from the Trustee, the Custodial Agent, MBIA or the Holders, as a preference,
fraudulent transfer or otherwise, and any such payments which are so rescinded
or recovered shall constitute Guaranteed Obligations for all purposes under this
Agreement.
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Section 2.8 Subordinated Loans.
(a) Guarantor may make to, or obtain for, BPL or MHLP Subordinated
Loans ("Guarantor Subordinated Loan") for the purpose of providing funds with
which to pay some or all of the Guaranteed Obligations.
(b) Upon making or obtaining any Guarantor Subordinated Loan, the
purpose of which is to fund payment by BPL of Cost Overrun Obligations,
Guarantor shall provide the Trustee with an Officer's Certificate in the form of
Exhibit A attached hereto (a "Guarantor Subordinated Loan Certificate").
Section 2.9 Reduction of Cost Overrun Guaranty.
(a) At any time on or after the date the AGMP (as defined in the
Construction Contract) has been established pursuant to the terms of the
Construction Contract, Guarantor may request that the Cost Overrun Guaranteed
Amount be reduced pursuant to this Section 2.9(a) by delivering to the Trustee
and MBIA the following:
(i) a written request for such a reduction which request shall
refer specifically to this Section 2.9(a);
(ii) an Officer's Certificate from BPL (A) stating that the
AGMP has been established pursuant to the terms of the Construction Contract and
setting forth the amount of the AGMP, together with a letter or certificate from
the Contractor to the same effect and (B) specifying the amount of Forecasted
Project Costs as of the date of such Officer's Certificate (taking the AGMP into
account) and containing an itemization thereof in reasonable detail; and
(iii) a letter or certificate from the Construction Consultant
stating that, in its professional opinion, such Forecasted Project Costs are
reasonable.
Upon satisfaction of the foregoing conditions, the Cost Overrun
Guaranteed Amount shall be reduced to an amount equal to fifteen percent (15%)
of the amount of such Forecasted Project Costs.
(b) At the time of Construction Completion, Guarantor may request
that the Cost Overrun Guaranteed Amount be reduced pursuant to this Section
2.9(b) by delivering or causing to be delivered to the Trustee and MBIA the
following (which shall be in addition to those items set forth in the definition
of Construction Completion in the Indenture that are required to be delivered as
conditions to Construction Completion):
(i) a written request for such a reduction which request shall
refer specifically to this Section 2.9(b); and
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(ii) an Officer's Certificate from BPL setting forth (A) a
description of all Additional Known Costs, if any, (B) an estimate of the amount
of money needed to pay for the same and (C) the amount of money on deposit in
the Construction Account that is available to pay for the same (which amount
shall be in addition to all other amounts required to be reserved against Punch
List Items or other costs as a condition to Construction Completion) and, if
such amount is less than 100% of the Additional Known Costs, the amount of such
deficiency (the "Unfunded Additional Known Costs"), together with a letter from
each of the Architects and the Construction Consultant stating that in their
professional judgment such Officer's Certificate is reasonable.
If MBIA has either (i) delivered written confirmation to the
Guarantor and the Trustee stating that the foregoing conditions have been
satisfied, or (ii) the Guarantor has, by written notice to the Trustee and MBIA,
requested such written confirmation and MBIA has not, within 30 days provided
written notice to the Guarantor and the Trustee that it is denying such written
confirmation which notice shall specify the reasons therefor, the Cost Overrun
Guaranteed Amount shall be reduced by an amount equal to the amount by which the
Cost Overrun Guaranteed Amount exceeds the sum of (x) the amount of Unfunded
Additional Known Costs set forth in the Officer's Certificate referred to in the
foregoing clause (ii) and (y) $2,500,000 (the "Contingency Amount").
(c) At any time after Construction Completion (but no more
frequently than once during every 60-day period thereafter) until the date on
which the conditions set forth in Section 5.08 of the Deposit and Disbursement
Agreement have been satisfied, Guarantor may request that the Cost Overrun
Guaranteed Amount be reduced pursuant to this Section 2.9(c) by delivering or
causing to be delivered to the Trustee and MBIA the following:
(i) a written request for such reduction which request shall
refer specifically to this Section 2.9(c);
(ii) an Officer's Certificate from BPL stating the aggregate
cost of the Punch List Items that have been paid from the Construction Account
from the date of the previous request delivered pursuant to Section 2.9(b) or
2.9(c) and the aggregate estimated costs of the Punch List Items that have not
been completed;
(iii) an Officer's Certificate from BPL (A) stating that an
amount equal to 200% of the costs for the Punch List Items remaining unpaid as
set forth in the Officer's Certificate referred to in the foregoing clause (ii)
is on deposit in the Construction Account, (B) that no claims exist against BPL,
the County or the Project out of which a Lien based on furnishing labor or
material exists or might ripen, except any claim that is not due and payable and
any claim out of which a Lien exists or might ripen in the event that BPL
intends to contest such claim, in which event any such claim or claims shall be
described in reasonable detail, and (C) that any claims referred to in the
foregoing clause (B) are fully bonded against or funds
15
are on deposit in the Construction Account in an amount equal to 125% of the
amount of the claims;
(iv) an Officer's Certificate from BPL setting forth (A) a
description of all Additional Known Costs, (B) an estimate of the amount of
money needed to pay for the same and (C) the amount of money on deposit in the
Construction Account that is available to pay for the same (which amount shall
be in addition to all other amounts required to be reserved against Punch List
Items or other costs as a condition to Construction Completion) and, if such
amount is less than 100% of the Additional Known Costs, the amount of such
Unfunded Additional Known Costs; and
(v) a certificate of the Construction Consultant stating that
the Officer's Certificates described in clauses (ii) through (iv) above are
reasonable.
If MBIA has either (i) delivered written confirmation to the
Guarantor and the Trustee stating that the foregoing conditions have been
satisfied, or (ii) the Guarantor has, by written notice to the Trustee and MBIA,
requested such written confirmation and MBIA has not, within 15 days provided
written notice to the Guarantor and the Trustee that it is denying such written
confirmation which notice shall specify the reasons therefor, the Cost Overrun
Guaranteed Amount shall be reduced by an amount equal to the amount by which the
Cost Overrun Guaranteed Amount exceeds the sum of (x) the amount of Unfunded
Additional Known Costs set forth in the Officer's Certificate referred to in the
foregoing clause (ii) and (y) the Contingency Amount.
(d) At any time after the date on which the conditions set forth in
Section 5.08 of the Deposit and Disbursement Agreement have been satisfied, the
Cost Overrun Guaranteed Amount shall be reduced to zero. Pursuant to this
Section 2.9(d) the Guarantor shall also deliver or cause to be delivered to the
Trustee and MBIA the following:
(i) a written request for such reduction which request shall
refer specifically to this Section 2.9(d);
(ii) an Officer's Certificate from BPL certifying that all
conditions set forth in Section 5.08 of the Deposit and Disbursement Agreement
have been satisfied; and
(iii) a certificate of the Construction Consultant stating
that the Officer's Certificate described in clause (ii) above is accurate.
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ARTICLE 3.
SECURITY
Section 3.1 Grant of Security Interest.
As collateral security for the due and punctual payment, performance
and observance of all obligations of Guarantor under this Agreement and the
Guarantor pledges to the Trustee, and grants to the Trustee, for the benefit of
MBIA and for the equal and ratable benefit of the Holders, a security interest
in and Lien upon all of the Guarantor Collateral.
Section 3.2 Delivery of Guarantor Collateral, Certificates; Custodial
Agent.
(a) Concurrently with the execution and delivery of this Agreement,
Guarantor shall deliver the Initial Guarantor Collateral (and thereafter shall
deliver all other portions of the Guarantor Collateral capable of being so held)
to the Custodial Agent, to be held by the Custodial Agent as Guarantor
Collateral hereunder pursuant to the terms of the Custody Agreement. Guarantor
consents to the terms of the Custody Agreement and to all provisions thereof and
agrees to pay (or reimburse the Trustee for) all fees of the Custodial Agent for
acting as Custodial Agent under this Agreement and the Custody Agreement and all
other amounts for which the Trustee may become obligated under the Custody
Agreement, including the indemnification obligations under Section 9(b) thereof.
The Custodial Agent shall hold only readily marketable securities on behalf of
the Trustee and shall not hold cash or other property on its behalf.
(b) Guarantor shall promptly, and in any event within three days
after receipt thereof, deliver to the Trustee, for the benefit of MBIA and for
the equal and ratable benefit of the Holders (a) any original certificates or
other instruments or documents, if any, evidencing any Guarantor Collateral and
(b) concurrently with the delivery to the Trustee of any certificate or other
instrument or document representing such Guarantor Collateral, Guarantor shall
deliver an undated stock power covering such certificate, duly executed in blank
by Guarantor with, if the Trustee so requests, signature guaranteed.
Section 3.3 Maintenance of Perfected Security Interest.
Guarantor will take or cause to be taken, at Guarantor's expense,
all action required to perfect, maintain, preserve and protect the security
interests in, and Liens on, the Guarantor Collateral granted by this Agreement,
including, without limitation, (i) the filing of financing statements,
continuation statements, collateral assignments and any instruments of further
assurance, in such manner and in such places as may be required by law to
preserve and protect fully the rights of the Trustee, MBIA and the Holders under
this Agreement, (ii) the delivery of entitlement orders or instructions to any
securities intermediary (as defined in the UCC) as may be required to preserve
and protect the rights of the Holders, the Trustee, MBIA and
17
the Custodial Agent under this Agreement and the Custody Agreement, and (iii)
the delivery of such documents and instruments as may be necessary or
appropriate in the reasonable discretion of the Trustee, the Custodial Agent or
MBIA to perfect any security interest or Lien granted by this Agreement.
Section 3.4 Maintenance of Collateral Coverage Ratio.
(a) Guarantor shall at all times while this Agreement remains in
effect maintain a Collateral Coverage Ratio of not less than 1.5 to 1.0.
(b) Upon receipt by the Trustee from the Custodial Agent of a
Collateral Coverage Call, the Trustee shall promptly notify Guarantor by
telephone of such Collateral Coverage Call and deliver such Collateral Coverage
Call to Guarantor. Upon receipt by Guarantor of a Collateral Coverage Call,
Guarantor shall deliver to the Custodial Agent, to be held as Guarantor
Collateral pursuant to this Agreement for benefit of MBIA and for the equal and
ratable benefit of the Holders, Qualified Carnival Stock in an amount which,
taken together with the other Guarantor Collateral, shall be sufficient to cause
the Collateral Coverage Ratio to be not less than 2 to 1. If the Collateral
Coverage Call is received by Guarantor prior to 11:00 a.m. (Eastern Time) on any
Business Day, Guarantor shall deposit such Qualified Carnival Stock with the
Custodial Agent no later than 3:00 p.m. (Eastern Time) on the second succeeding
Business Day. If the Collateral Coverage Call is received by Guarantor on a day
which is not a Business Day, or after 11:00 a.m. (Eastern Time) on a Business
Day, Guarantor shall deposit such Qualified Carnival Stock with the Custodial
Agent no later than 3:00 p.m. (Eastern Time) on the third succeeding Business
Day.
(c) In the event that Guarantor fails fully and timely to deliver
all Qualified Carnival Stock to the Custodial Agent as required by this Section
3.4, the Trustee shall direct the Custodial Agent to sell such Guarantor
Collateral as the Trustee may direct in its sole discretion in such amount as
will produce proceeds (net of the costs and expenses of sale and of any accrued
and unpaid fees of the Custodial Agent) that as closely as reasonably possible
approximate the Guaranteed Amount, which proceeds shall thereafter be held by
the Trustee in a segregated account as Guarantor Collateral hereunder. No such
sale shall limit any obligation of Guarantor under this Agreement whether
existing at the time of such sale or arising thereafter except to the extent
that the proceeds of such a sale shall be credited to payment of any of the
Guaranteed Obligations.
(d) If at any time Guarantor deposits more Qualified Carnival Stock
with the Trustee or the Custodial Agent in response to a Collateral Coverage
Call than is required under the terms of this Agreement on the date of such
deposit (whether due to Guarantor's inability to obtain a certificate for the
appropriate number of shares of stock to be deposited or otherwise), the Trustee
shall, in accordance with the written directions of Guarantor, promptly return
or cause to be returned to Guarantor the amount of such excess Qualified
Carnival Stock.
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Section 3.5 Registration.
At any time and from time to time after the occurrence and during
the continuance of a Guaranty Event of Default, the Trustee may cause all or any
of the Guarantor Collateral to the extent not already held in "street name" to
be transferred to or registered in its name or the name of its nominee or
nominees.
Section 3.6 Voting Rights.
With respect to all Qualified Carnival Stock held as Guarantor
Collateral hereunder, Guarantor, be entitled to exercise, as it shall think fit,
the voting power with respect to such Guarantor Collateral, and for that purpose
the Trustee shall (if such Guarantor Collateral shall be registered in street
name) execute or cause to be executed from time to time, at the expense of
Guarantor, such proxies or other instruments in favor of Guarantor or its
nominee, in such form and for such purposes as shall reasonably be required by
Guarantor and shall be specified in a written request therefor, to enable
Guarantor to exercise such voting power with respect to such Guarantor
Collateral.
Section 3.7 Dividends and Distributions.
Unless a Guaranty Event of Default has occurred and is continuing,
Guarantor shall be entitled to receive and retain all dividends and
distributions made upon or with respect to the Guarantor Collateral. At any time
while a Guaranty Event of Default has occurred and is continuing, Guarantor
shall pay or deliver all dividends and distributions received upon or with
respect to the Guarantor Collateral to the Trustee promptly and in any event
within three Business Days of its receipt thereof and the same shall thereafter
be held by the Trustee as Guarantor Collateral hereunder.
Section 3.8 Care of Guarantor Collateral.
The Trustee's duties as to the care of Guarantor Collateral shall be
the standard of care set forth in the Indenture. The duties of and standard of
care applicable to the Custodial Agent are set forth in the Custody Agreement.
Section 3.9 Power of Attorney.
Guarantor hereby appoints the Trustee as Guarantor's
attorney-in-fact, effective upon the occurrence and during the continuance of a
Guarantor Event of Default, for the purpose of carrying out the provisions of
this Agreement and taking any action and executing any instrument which the
Trustee may deem necessary or advisable to accomplish the purposes hereof. The
power of attorney granted hereunder is coupled with an interest and is
irrevocable until the Termination Date.
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Section 3.10 Partial Release of Guarantor Collateral.
In the event that the Collateral Coverage Ratio is at least 2.50 to
1 for four (4) consecutive months, and so long as no Guaranty Event of Default
has occurred and is continuing, upon the written request of Guarantor delivered
to the Trustee and accompanied by a properly completed Officer's Certificate in
the form attached hereto as Exhibit B (a "Release Certificate), the Trustee
shall release, or shall direct the Custodial Agent to release, the Lien
hereunder as to an amount of Qualified Carnival Stock such that, after giving
effect to such release, the Collateral Coverage Ratio is not less than 2.50 to
1. Any Guarantor Collateral as to which the Lien hereunder is so released shall
promptly be returned to Guarantor and, thereafter, shall no longer constitute
Guarantor Collateral.
Section 3.11 Return of Guarantor Collateral.
Subject to Section 7.7, all obligations of Guarantor under this
Agreement shall terminate on the Termination Date. Promptly after the
Termination Date, the Trustee shall return, or cause to be returned, all
Guarantor Collateral held by it or by the Custodial Agent to Guarantor. The
return by the Trustee of such Guarantor Collateral shall be without
representation or warranty of any nature whatsoever and wholly without recourse;
provided, however, that such Guarantor Collateral shall be returned free of any
Lien created by the Trustee or the Custodial Agent and of any Lien created by
this Agreement or the other Note Documents.
Section 3.12 Consents, Notices, Reports under Custody Agreement.
(a) Promptly after the receipt thereof, the Trustee shall deliver to
Guarantor and MBIA copies of all notices, statements and other written
communications received by the Trustee from the Custodian under the Custody
Agreement.
(b) Without the prior written consent of Guarantor, the Trustee
shall not consent to the appointment of a temporary custodian pursuant to
Section 12(c), consent to any amendment or waiver of any provision of the
Custody Agreement, consent to the assignment by the Custodial Agent of any of
its rights or obligations under the Custody Agreement, disclose any information
pursuant to Section 15 or otherwise approve or consent to any act or request
under the Custody Agreement.
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ARTICLE 4.
REPRESENTATIONS AND WARRANTIES
Guarantor hereby represents and warrants that:
Section 4.1 Existence; Compliance with Law.
Guarantor (a) is duly organized, validly existing and, if
applicable, in good standing under the laws of the jurisdiction of its
organization, (b) has the power and authority, and the legal right, to own and
operate its property and to conduct the activities in which it is currently
engaged, and (c) is in compliance with all Applicable Laws except to the extent
that the failure to comply therewith could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.
Section 4.2 Power; Authorization; Enforceable Obligations.
Guarantor has the power and authority, and the legal right, to
execute, deliver and perform this Agreement and the Custody Agreement. Guarantor
has taken all necessary action to authorize the execution, delivery and
performance of this Agreement and the Custody Agreement. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required (other than those which
have been obtained and remain in full force and effect) in connection with the
execution, delivery, performance, validity or enforceability of this Agreement
or the Custody Agreement. This Agreement and each of the Custody Agreement has
been duly executed and delivered on behalf of Guarantor. This Agreement and each
Custody Agreement constitutes a legal, valid and binding obligation of Guarantor
enforceable against Guarantor in accordance with its terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
Section 4.3 Financial Condition.
(a) The statement of net assets of Guarantor as at December 31,
1997, and audited by Price Waterhouse LLP, a copy of which has heretofore been
furnished to the Trustee and MBIA presents fairly in all material respects the
financial condition of Guarantor as at such date.
(b) Except as set forth on Schedule 4.3(c), during the period from
the date of Guarantor's statement of net assets described in Section 4.3(a) to
and including the Closing Date, there has been no (i) sale, transfer or other
disposition by Guarantor of any material part of its property, (ii) purchase or
other acquisition by Guarantor of any property material in relation to
Guarantor's financial condition, or (iii) development or event which has had or
could reasonably be expected to have a Material Adverse Effect.
21
Section 4.4 No Legal Bar.
The execution, delivery and performance of this Agreement and the
Custody Agreement will not violate any Applicable Law or any Contractual
Obligation of Guarantor and will not result in, or require, the creation or
imposition of any Lien other than Permitted Liens on any of its properties or
revenues pursuant to any such Applicable Law or Contractual Obligation.
Section 4.5 No Material Litigation.
No litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of
Guarantor, threatened in writing by or against Guarantor or against any of its
properties or revenues which could reasonably be expected to have a Material
Adverse Effect.
Section 4.6 No Guaranty Default.
Guarantor is not in default, nor to its knowledge is there any event
or condition which with the passage of time or the giving of notice would ripen
into a default, under or with respect to any of its Contractual Obligations
except to the extent that any of the foregoing could not reasonably be expected
to have a Material Adverse Effect. No Guaranty Default or Guaranty Event of
Default has occurred and is continuing.
Section 4.7 Organizational Documents.
The Agreement of Limited Partnership of MA 1994 B Shares, L.P. dated
as of December 29, 1997 is in full force and effect and has not been modified or
terminated. MA 1994 B Shares, Inc., a Delaware corporation, is the sole general
partner in the Limited Partnership. JMD Delaware, Inc., as trustee of the ▇▇▇▇▇
▇▇▇▇▇▇ 1994 "B" Trust established pursuant to that certain trust agreement dated
as of September 27, 1994, is the sole limited partner in Guarantor and the sole
shareholder of MA 1994 B Shares, Inc.
Section 4.8 Taxes.
Guarantor has filed or caused to be filed all tax returns which, to
the knowledge of such Guarantor, are required to be filed and has paid all taxes
shown to be due and payable on such returns or on any assessments made against
it or any of its property and all other taxes, fees or other charges imposed on
it or any of its property by any Governmental Authority (other than any the
amount or validity of which are currently being contested in good faith by
appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided on the books of such Guarantor). No tax Lien has been
filed, and, to the knowledge of Guarantor, no claim is being asserted, with
respect to any such tax, fee or other charge.
22
Section 4.9 Representations and Warranties Respecting the Guarantor
Collateral.
(a) The Initial Guarantor Collateral is, and all other Guarantor
Collateral hereafter delivered to the Trustee will be, owned by the Guarantor
delivering the same to the Trustee, free and clear of all Liens except Permitted
Liens.
(b) The security interest created pursuant to this Agreement will
constitute a valid, perfected first-priority security interest in the Initial
Guarantor Collateral, enforceable in accordance with its terms against all
creditors of Guarantor and any Persons purporting to purchase any Guarantor
Collateral from Guarantor, except as enforceability may be affected by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing.
(c) All of the Initial Guarantor Collateral is Qualified Carnival
Stock.
Section 4.10 Net Worth.
As of the date hereof, Guarantor has a Net Worth of One Billion
Dollars ($1,000,000,000) or more.
Section 4.11 Unencumbered Liquid Assets.
As of the date hereof, Guarantor own Unencumbered Liquid Assets of
Three Hundred Million Dollars ($300,000,000) or more.
ARTICLE 5.
AFFIRMATIVE COVENANTS
Section 5.1 Financial Statements.
Guarantor will finish to the Trustee and MBIA, as soon as available,
but in any event within 120 days after the end of each Fiscal Year, the
statement of net assets of Guarantor as at the end of such Fiscal Year, prepared
on an accounting basis comparable to that on which the statement of net assets
described in Section 4.3 were prepared and audited by independent certified
public accountants of nationally recognized standing.
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Section 5.2 Certificates; Other Information.
Guarantor will finish to the Trustee and MBIA:
(a) within thirty (30) days after the end of each quarterly fiscal
period of each Fiscal Year, an Officer's Certificate of Guarantor (i) stating
that during such period Guarantor has observed or performed all of its covenants
and other agreements, and satisfied every condition contained in this Agreement
to be observed, performed or satisfied by it, (ii) stating that the officer
executing such certificate has obtained no knowledge of any Guaranty Default or
Guaranty Event of Default except as specified in such Officer's Certificate,
setting forth the amounts of Guarantor's Net Worth and Unencumbered Liquid
Assets as at the end of such quarter, and (iv) stating that the stock powers
delivered in connection with all Qualified Carnival Stock remain effective to
effect the transfer of such Qualified Carnival Stock.
(b) within 30 days after the end of each quarterly fiscal period of
each Fiscal Year, an Officer's Certificate of Guarantor in the form attached as
Exhibit C to this Agreement (a "Guaranteed Amount Certificate"), containing a
calculation of the Guaranteed Amount as at the end of such quarterly fiscal
period.
Section 5.3 Payment of Obligations.
Guarantor will duly pay and discharge, as the same shall become due
and payable and before the same shall become delinquent, all its obligations of
whatever nature, including all taxes and other charges lawfully levied and
imposed by any Governmental Authority upon such Guarantor or its properties,
provided, however, that nothing contained in this Section shall be construed as
a waiver of any statutory exemption from or abatement of taxation nor to require
Guarantor to pay, acquire or make provision for any such tax, assessment, lien
or charge so long as Guarantor in good faith shall diligently contest the
validity thereof and reserves in conformity with GAAP with respect thereto have
been provided on the books of Guarantor.
Section 5.4 Compliance with Applicable Law and Contractual Obligations.
Guarantor will comply with all provisions of any Applicable Law.
Section 5.5 Legal Existence of Guarantor.
Guarantor will at all times maintain its legal existence under the
laws of the State of Delaware and will duly procure any necessary renewals and
extensions thereof, will maintain, preserve and renew all the rights, powers,
privileges and franchises necessary or desirable in the normal course of its
business or other activities.
24
Section 5.6 Title Curative Proceedings.
Guarantor will promptly take such actions as may be necessary or
proper to remedy or cure any defect in or cloud upon the title to the Guarantor
Collateral or any part thereof, whether now existing or hereafter developing.
Section 5.7 Notices.
Promptly upon receiving notice thereof, Guarantor will give, or
cause to be given, prompt written notice of (a) any Guaranty Default or Guaranty
Event of Default and (b) any actions, proceedings or notices adversely affecting
the Lien of the Trustee in the Guarantor Collateral.
Section 5.8 Covenants Respecting the Guarantor Collateral.
(a) Guarantor shall maintain the security interests created by this
Agreement as first priority, perfected security interests and shall defend such
security interests against claims and demands of all Persons whomsoever. At any
time and from time to time, upon the written request of the Trustee or the
Custodial Agent, and at the sole expense of Guarantor, Guarantor will promptly
and duly execute and deliver such further instruments and documents and take
such further actions as the Trustee or the Custodial Agent may reasonably
request for the purposes of obtaining or preserving the benefits of this
Agreement and of the rights and powers herein granted.
(b) Guarantor shall pay, and save the Trustee, MBIA, the Custodial
Agent and the Holders, harmless from, any and all liabilities with respect to,
or resulting from any delay in paying, any and all stamp, excise, sales or other
taxes which may be payable or determined to be payable with respect to any of
the Guarantor Collateral or in connection with any of the transactions
contemplated by this Agreement.
Section 5.9 Fees of Custodial Agent.
Guarantor shall timely pay (or reimburse the Trustee for upon
demand) all fees of the Custodial Agent charged pursuant to the terms of the
Custody Agreement.
ARTICLE 6.
NEGATIVE COVENANTS
Section 6.1 Net Worth.
Guarantor will not permit its Net Worth at any time to be less than
One Billion Dollars ($1,000,000,000).
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Section 6.2 Unencumbered Liquid Assets.
Guarantor will not at any time permit its Unencumbered Liquid Assets
to be less than Three Hundred Million Dollars ($300,000,000).
Section 6.3 Liens.
Guarantor will not directly or indirectly, create, assume, incur or
suffer to exist upon the Guarantor Collateral or any part thereof any Lien
except Permitted Liens.
ARTICLE 7.
DEFAULTS AND REMEDIES
Section 7.1 Events of Default.
A "Guaranty Event of Default " occurs if:
(a) Guarantor defaults in the payment when due of any of the
Guaranteed Obligations as provided in this Agreement and such default continues
without being waived in writing by the Majority Holders for a period of five (5)
Business Days;
(b) Guarantor defaults in the payment of any other amount payable to
the Trustee under this Agreement and such default continues without being waived
in writing by the Majority Holders for a period of five (5) Business Days;
(c) Guarantor fails to timely deliver any required Acceptable
Guarantor Collateral in response to a Collateral Coverage Call as provided in
Section 3.4;
(d) Guarantor defaults in the observance or performance of any other
agreement contained in this Agreement and such default continues without being
waived in writing by the Majority Holders for a period of 60 days;
(e) any representation or warranty made by Guarantor in this
Agreement shall prove to have been inaccurate in any material respect on or as
of the date made and such inaccuracy shall have a Material Adverse Effect;
(f) this Agreement, at any time and for any reason, ceases to be
valid, binding and enforceable or Guarantor contests or denies the validity or
enforceability thereof;
(g) Guarantor, pursuant to or within the meaning of any Bankruptcy
Law:
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(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it
in an involuntary case,
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) admits in writing its inability to pay its debts as they
become due;
(h) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(i) is for relief against Guarantor, in an involuntary case,
(ii) appoints a Custodian of Guarantor or for all or
substantially all of the property of Guarantor, or
(iii) orders the liquidation of Guarantor,
and the order or decree remains unstayed and in effect for 60 consecutive days;
Section 7.2 Remedies in General.
(a) If a Guaranty Event of Default described in Section 7.1(a) or
(b) occurs and is continuing, the Trustee may direct the Custodial Agent to sell
such Guarantor Collateral as the Trustee may direct in its sole discretion in
such amount as will produce proceeds (net of the costs and expenses of sale and
of any accrued and unpaid fees of the Custodial Agent) (i) in the case of a
Guaranty Event of Default described in Section 7.1(c), that as closely as
reasonably possible approximates the Guaranteed Amount and (ii) in the case of a
Guaranty Event of Default described in Section 7.1 (a) or (b) that as closely as
reasonably possible approximates the amount of the payment which Guarantor was
required, but failed, to make. In the case of a sale pursuant to clause (i) of
the foregoing sentence, the Trustee may hold the proceeds of such sale as
Guarantor Collateral hereunder, and in the case of a sale pursuant to clause
(ii) of the foregoing sentence, the Trustee may apply the proceeds of such sale
to the payment which Guarantor was required, but failed to make. No such sale
shall limit any obligation of Guarantor under this Agreement whether existing at
the time of such sale or arising thereafter.
(b) If a Guaranty Event of Default other than a Guaranty Event of
Default described in Section 7.1(a) or (b) occurs and is continuing, the Trustee
may
27
pursue any remedy available under this Agreement or Applicable Law to collect
the payment of any amount owing by Guarantor under the terms of this Agreement
or to enforce the performance of any provision of this Agreement. A delay or
omission by the Trustee in exercising any right or remedy accruing upon a
Guaranty Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Guaranty Event of Default. All remedies are
cumulative to the extent permitted by Applicable Law.
Section 7.3 Procedures With Respect to Sale of the Guarantor Collateral.
(a) If a Guaranty Event of Default shall occur and be continuing,
the Trustee, on behalf of the Holders and MBIA, without obligation to resort to
other security, may exercise in respect of the Guarantor Collateral, in addition
to all other rights and remedies provided for in this Agreement or the Custody
Agreement or otherwise available to it, all the rights and remedies of a secured
party under the UCC.
(b) The remedies provided herein in favor of the Trustee for the
benefit of MBIA and for the equal and ratable benefit of the Holders shall not
be deemed exclusive, but shall be cumulative, and shall be in addition to all
other remedies in favor of the Trustee and the Holders in this Agreement and
otherwise existing by contract or under Applicable Law.
Section 7.4 Expenses and Interest.
(a) In the event that the Trustee prevails in any dispute relating
to the interpretation, enforcement or performance of this Agreement, the Trustee
shall be entitled to collect from Guarantor on demand all reasonable fees and
expenses incurred in connection therewith, including but not limited to fees and
disbursements of attorneys, accountants, consultants, expert witnesses,
arbitrators, mediators and court reporters. Without limiting the generality of
the foregoing, Guarantor shall pay all such costs and expenses incurred in
connection with proceedings under any Bankruptcy Law with respect to Guarantor.
(b) Guarantor will reimburse the Trustee for any and all reasonable
expenditures by the Trustee for (a) the maintenance, protection and preservation
of the Collateral or the Trustee's security interests in the Collateral; (b) the
sale or other disposition of or realization upon the Collateral; and (c) costs
and expenses incurred by the Trustee in taking (or otherwise in connection with)
any action which Guarantor is required, but fails, to take under the terms of
this Agreement.
(c) All costs, fees and expenses described, in this Section 7.4
shall be due and payable on written demand (accompanied by reasonable supporting
information), shall bear interest from the date of such demand until paid at the
highest rate borne by any of the Notes Outstanding and shall be secured hereby.
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ARTICLE 8.
MISCELLANEOUS
Section 8.1 Further Assurances.
Guarantor shall, upon request of the Trustee, duly execute and
deliver, or cause to be duly executed and delivered, to the Trustee such further
instruments and take and cause to be taken such further actions as may be
necessary or proper in the reasonable opinion of the Trustee to carry out more
effectively the provisions and purposes of this Agreement.
Section 8.2 No Subrogation.
Notwithstanding any payment or payments made by Guarantor hereunder,
or any setoff or application of funds of Guarantor by the Trustee, MBIA or any
Holder, or the receipt of amounts by any of such parties with respect to any of
the Guarantor Collateral, except as expressly permitted in any Subordination
Agreement in effect among Guarantor, the Trustee and BPL or MHLP, until the
Termination Date, Guarantor shall not be entitled to be subrogated to any of the
rights of the Trustee, MBIA or any Holder against any guarantor (including a
guarantor in its role as debtor or guarantor) or against any other collateral
security held by the Trustee for payment of the Guaranteed Obligations and the
other obligations secured hereby, nor shall Guarantor seek any reimbursement
from BPL or MHLP in respect of payments made by Guarantor in connection with the
Guarantor Collateral, or amounts realized by the Trustee in connection with the
Guarantor Collateral. If any amount shall be paid to Guarantor on account of
such subrogation rights at any time when not permitted under the foregoing
sentence, such amount shall be held by such Guarantor in trust for the Trustee,
segregated from other funds of such Guarantor, and shall forthwith upon receipt
by Guarantor, be turned over to the Trustee in the exact form received by
Guarantor (duly endorsed by such Guarantor to the Trustee, if required) to be
applied against the Guaranteed Obligations and the other obligations secured
hereby, whether matured or unmatured.
Section 8.3 Authority of Trustee.
Guarantor acknowledges that the rights and responsibilities of the
Trustee under this Agreement with respect to any action taken by the Trustee or
the exercise or non-exercise by the Trustee of any option, voting right,
request, judgment or other right or remedy provided for in this Agreement or
resulting or arising out of this Agreement shall, as between the Trustee, MBIA
and the Holders, be governed by the Indenture and by such other agreements with
respect thereto as may exist from time to time between them, but, as between the
Trustee and Guarantor, the Trustee shall be conclusively presumed to be acting
as agent for the Holders with full and valid authority so to act or refrain from
acting, and guarantor nor any issuer of any of the Guarantor Collateral shall be
under any obligation, or entitlement, to make any inquiry respecting such
authority.
29
Section 8.4 No Waiver.
No act, omission or delay by the Trustee or course of dealing
between the Trustee and Guarantor shall constitute a waiver of the rights and
remedies of the Trustee hereunder. No single or partial waiver by the Trustee or
any Holder of any Guaranty Default or Guaranty Event of Default or right or
remedy which it may have shall operate as a waiver of any other Guaranty
Default, Guaranty Event of Default, right or remedy or of the same Guaranty
Default, Guaranty Event of Default, right or remedy on a future occasion.
Guarantor hereby waives presentment, notice of dishonor and protest of all
instruments included in or evidencing any of the Guaranteed Obligations or
Guarantor Collateral, and all other notices and demands whatsoever (except as
expressly provided herein).
Section 8.5 Notices.
Any notice, request, instruction, order or other communication by
Guarantor or the Trustee to the other is duly given only if in writing and
delivered in person, by telecopier or by overnight air courier guaranteeing next
day delivery, to the other's address as follows:
If to Guarantor:
▇/▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
1285 Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
If to Trustee:
Citibank, N.A.
Corporate Agency and Trust
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
5th Floor, Zone #2
New York, New York 10043
Attention: Structured Finance Team
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
30
With a copy to:
MBIA Insurance Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Insured Portfolio Management - PF
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Guarantor or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
All notices and other communications under this Agreement shall be
deemed to have been duly given when (a) delivered by hand (with written
confirmation of receipt); (b) sent by telecopier (with written or electronic
confirmation of receipt), provided that a copy is also sent on the same day by
hand- delivery or by a nationally-recognized overnight delivery service (such as
Federal Express) guaranteeing delivery on the next Business Day; or (c) received
by the addressee, if sent by a nationally-recognized overnight delivery service
(such as Federal Express) guaranteeing delivery on the next Business Day.
Section 8.6 Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS AGREEMENT.
Section 8.7 Submission To Jurisdiction, Waivers.
GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY:
(A) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND THE NOTE DOCUMENTS TO
WHICH IT IS A PARTY, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN
RESPECT THEREOF TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF.
(B) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE
BROUGHT IN, OR TRANSFERRED TO, SUCH COURTS AND WAIVES ANY OBJECTION THAT
IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT OR THAT SUCH ACTION OR
31
PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD
OR CLAIM THE SAME;
(C) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR
PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR
CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE
PREPAID, TO GUARANTOR AT ITS ADDRESS REFERRED TO IN SECTION 8.8 OR AT SUCH
OTHER ADDRESS OF WHICH THE TRUSTEE SHALL HAVE BEEN NOTIFIED PURSUANT
THERETO;
(D) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO
EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW
OR SHALL LIMIT THE RIGHT OF THE TRUSTEE TO ▇▇▇ IN ANY OTHER JURISDICTION;
(E) WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LEGAL
ACTION OR PROCEEDING REFERRED TO IN THIS SECTION ANY SPECIAL, EXEMPLARY,
PUNITIVE OR CONSEQUENTIAL DAMAGES; AND
(F) WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM, WHETHER SOUNDING IN CONTRACT OR IN TORT,
ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY MATTER ARISING
HEREUNDER.
Section 8.8 Successors and Assigns.
All agreements of Guarantor or the Trustee in this Agreement shall
bind, and inure to the benefit of, their respective successors and permitted
assigns.
Section 8.9 Severability.
In case any provision in this Agreement shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions, or of such provision in any other jurisdiction, shall
not in any way be affected or impaired thereby.
Section 8.10 Counterpart Originals.
The parties may sign any number of copies of this Agreement. Each
signed copy shall be an original but all of them together represent the same
agreement.
32
Section 8.11 Table of Contents, Headings, etc.
The Table of Contents and Headings of the Articles and Sections of
this Agreement have been inserted for convenience of reference only, are not to
be considered a part of this Agreement and shall in no way modify or restrict
any of the terms or provisions hereof.
Section 8.12 Amendments.
No waiver, amendment, modification or termination of any provision
of this Agreement, or consent to any departure by Guarantor therefrom, shall in
any event be effective without the written concurrence of the Trustee and MBIA
and none of the Guarantor Collateral shall be released, except as expressly
provided herein, without the written consent of the Trustee and MBIA. Any such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, all as of the date first written above.
MA 1994 B SHARES, L.P., a Delaware limited
partnership
By: MA 1994 B SHARES, INC., a Delaware
corporation, its sole general partner
EXHIBIT A
FORM OF
GUARANTOR SUBORDINATED LOAN CERTIFICATE
Reference is made to that certain Guaranty and Pledge Agreement (the
"Guaranty and Pledge Agreement") dated as of May 20, 1998 between MA 1994 B
Shares, L.P., a Delaware limited partnership ("Guarantor"), in favor of
Citibank, N.A. (the "Trustee"), a national banking association, as Trustee for
the Holders of the series of notes issued by Basketball Properties, Ltd., a
Florida limited partnership ("BPL"), pursuant to that certain Indenture dated as
of May 20, 1998.
This Certificate is provided to the Trustee pursuant to Section 2.8
of the Guaranty and Pledge Agreement. Capitalized terms used in this Certificate
and not otherwise defined have the meanings given to those terms in the Guaranty
and Pledge Agreement.
Guarantor hereby certifies to the Trustee as follows:
1. On the date hereof, Guarantor has made, or obtained, a
Subordinated Loan to BPL in the principal amount of $______________________ for
the sole purpose of funding payment by BPL of Cost Overrun Obligations.
2. Delivered to the Trustee herewith is the original of each
promissory note or other instrument evidencing BPL's obligations to repay the
Subordinated Loan described above, indorsed to the order of the Trustee for
security purposes.
3. The Subordinated Loan described above is subordinated to all
obligations of BPL to the Trustee and the Holders pursuant to the terms of a
Subordination Agreement (as defined in the Indenture).
DATED this day of , .
MA 1994 B SHARES, L.P.,
a Delaware limited partnership
By: MA 1994 B SHARES, INC.,
a Delaware corporation, its sole
general partner
By:
Its:
EXHIBIT B
FORM OF
RELEASE CERTIFICATE
Reference is made to that certain Guaranty and Pledge Agreement (the
"Guaranty and Pledge Agreement") dated as of May 20, 1998 between MA 1994 B
Shares, L.P., a Delaware limited partnership ("Guarantor"), in favor of
Citibank, N.A. (the "Trustee"), a national banking association, as Trustee for
the Holders of the series of notes issued by Basketball Properties, Ltd., a
Florida limited partnership ("BPL"), pursuant to that certain Indenture dated as
of May 20, 1998.
This Certificate is provided to the Trustee pursuant to Section 3.11
of the Guaranty and Pledge Agreement. Capitalized terms used in this Certificate
and not otherwise defined have the meanings given to those terms in the Guaranty
and Pledge Agreement.
Guarantor hereby certifies to the Trustee as follows:
1. This Certificate is submitted to the Trustee together with a
written request for the release of the liens held by the Trustee under the
Guaranty and Pledge Agreement as to ____________ shares of the Class A common
stock of Carnival Corporation held by the Trustee or its nominee as Guarantor
Collateral pursuant to the terms of the Guaranty and Pledge Agreement.
2. The Collateral Coverage Ratio has been at least 2.5 to 1 for at
least the four (4) months immediately preceding the date of this Certificate and
after the release of the shares described above from the lien of the Guaranty
and Pledge Agreement, the Collateral Coverage Ratio will be at least 2.5 to 1.
3. No Guaranty Event of Default has occurred and is continuing.
DATED this day of , .
MA 1994 B SHARES, L.P.,
a Delaware limited partnership
By: MA 1994 B SHARES, INC.,
a Delaware corporation, its sole
general partner
By:
Its:
EXHIBIT C
FORM OF
GUARANTEED AMOUNT CERTIFICATE
Reference is made to that certain Guaranty and Pledge Agreement (the
"Guaranty and Pledge Agreement") dated as of May 20, 1998 between MA 1994 B
Shares, L.P., a Delaware limited partnership ("Guarantor"), in favor of
Citibank, N.A. (the "Trustee"), a national banking association, as Trustee for
the Holders of the series of notes issued by Basketball Properties, Ltd., a
Florida limited partnership ("BPL"), pursuant to that certain Indenture dated as
of May 20, 1998.
This Certificate is provided to the Trustee pursuant to Section
5.2(c) of the Guaranty and Pledge Agreement. Capitalized terms used in this
Certificate and not otherwise defined have the meanings given to those terms in
the Guaranty and Pledge Agreement.
Guarantor hereby certifies to the Trustee that, as of the date of
this Certificate, the Guaranteed Amount is $ ________________________ calculated
as follows:
Equity Obligations $ ____________________________
BPL Delay Debt Service Obligations ____________________________
Cost Overrun Obligations ____________________________
COI Obligations ____________________________
Guaranteed Amount $ ____________________________
DATED this day of , .
MA 1994 B SHARES, L.P.,
a Delaware limited partnership
By: MA 1994 B SHARES, INC.,
a Delaware corporation, its sole
general partner
By:
Its:
SCHEDULE 4.3(c)
Change in Financial Condition
1. In February 1998, MA 1994 B Shares, L.P. sold 900,000 shares of Carnival
Corporation Class A common stock for approximately $53 million.
2. MA 1994 B Shares, L.P. holds 8,000,000 shares (the "Shares") of Pan Am
corporation common stock. As of December 31, 1997, the Shares of Pan Am
common stock traded at $2 5/16 per share, for a total market value of the
Shares of $18 million. As of April 30, 1998, the Shares of Pan Am common
stock traded at $.50 per share, for a total market value of the Shares of
$4 million.
ADDENDUM TO GUARANTY
AND PLEDGE AGREEMENT
Addendum to Guaranty and Pledge Agreement (the "Guaranty") dated as
of May 20, 1998 between MA 1994 B Shares, L.P., a Delaware limited partnership
("Guarantor"), and Citibank, N.A., a national banking association, as Trustee
(the "Trustee"), for the holders of the series of Notes issued by Basketball
Properties, Ltd., a Florida limited partnership.
Guarantor agrees as follows for the benefit of the Trustee and MBIA
and for the equal and notable benefit of the Holders:
1. This Addendum is attached to and forms a part of the Guaranty.
2. Guarantor agrees that, until the Contractor Delay Debt Service
Guaranty has been delivered to the Trustee together with the legal opinions of
counsel to the guarantors under the Contractor Delay Debt Service Guaranty, the
BPL Delay Debt Service Obligations shall be $14,021,184.68; provided, however,
that (a) Guarantor shall be required to maintain the Collateral Coverage Ratio
with respect to $8,000,000 thereof only if such Contractor Delay Debt Service
Guaranty and such legal opinions have not been received by the Trustee on or
before June 3, 1998; and (b) upon the Trustee's receipt of such Contractor Delay
Debt Service Guaranty and legal opinions, the BPL Delay Debt Service Obligations
shall be reduced automatically and immediately to $6,021,184.68.
DATED this 20th day of May, 1998.
MA 1994 B SHARES, L.P.,
a Delaware limited partnership
By: MA 1994 B SHARES, INC.,
a Delaware corporation, its sole
general partner
By:
Name:
Title: