************************************************************
FORUM GROUP, INC.,
as Borrower
_____________________________
CREDIT AGREEMENT
Dated as of September 1, 1995
______________________________
NOMURA ASSET CAPITAL CORPORATION,
as Lender
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TABLE OF CONTENTS
Page
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Section 1. Definitions and Accounting Matters 1
1.01 Certain Defined Terms 1
1.02 Accounting Terms and Determinations 17
Section 2. The Loan, Advances, Note and Prepayments 18
2.01 The Loan 18
2.02 Advances 18
2.03 Note 18
2.04 Optional Prepayments 19
2.05 Mandatory Prepayment 19
Section 3. Payments of Principal, Interest and Exit Fee 19
3.01 Repayment of the Loan 19
3.02 Interest 19
3.03 Cash Management. 20
3.04 Security Agreement 20
Section 4. Payments; Computations; Etc. 21
4.01 Payments 21
4.02 Computations 22
4.03 Minimum Amounts 22
4.04 Certain Notices 22
4.05 Set-off 23
4.06 Illegality 23
4.07 Compensation 23
Section 5. Conditions Precedent 24
5.01 Closing Date 24
5.02 Initial and Subsequent Advances 25
Section 6. Representations and Warranties 26
6.01 Corporate Existence 26
6.02 Financial Condition 27
6.03 Litigation 27
6.04 No Breach 27
6.05 Action 28
6.06 Approvals 28
6.07 Use of Credit 28
6.08 ERISA 28
6.09 Taxes 29
6.10 Investment Company Act 29
6.11 Public Utility Holding Company Act 29
6.12 Ownership of Stock or Partnership Interests 29
6.13 Environmental Matters 30
6.14 FGI SEC Reports 32
6.15 Agreements 32
6.16 No Bankruptcy Filing 32
6.17 Location of Chief Executive Offices 33
6.18 Compliance 33
(i)
Section 7. Covenants of the Borrower 33
7.01 Financial Statements Etc. 33
7.02 Litigation; Environmental Claims 36
7.03 Existence, Etc. 37
7.04 Prohibition of Fundamental Changes 38
7.05 Limitation on Liens 38
7.06 Place of Business 38
7.07 Perform Loan Documents 38
7.08 Dividend Payments 39
7.09 Sale or Transfer of Facilities 39
7.10 Replacement of Manager 39
7.11 No Sale of Stock or Partnership Interests 39
7.12 Limitation on Issuance of Preferred Stock;
Cooperation with Rating Agencies 39
7.13 Use of Proceeds 40
7.14 Cooperate in Legal Proceedings 40
7.15 Further Assurances 40
Section 8. Events of Default 40
Section 9. Subordination. 43
9.01 Subordination to Senior Indebtedness 43
9.02 Borrower Not To Make Payments in Certain
Circumstances 44
9.03 Subordination in the Event of Acceleration,
Dissolution, Liquidation or Reorganization 45
9.04 Lender to Be Subrogated to Rights of Holders
of Senior Indebtedness 46
9.05 Obligations of the Borrower Unconditional 46
9.06 Subordination Rights Not Impaired by Acts or
Omissions of Borrower or Holders of Senior
Indebtedness 47
9.07 Further Assurances with Respect to
Subordination 47
9.08 Limitation on Subordination 47
9.09 Certain Definitions 48
Section 10. Miscellaneous 48
10.01 Waiver 48
10.02 Notices 48
10.03 Expenses, Etc. 49
10.04 Amendments, Etc. 50
10.05 Successors and Assigns 50
10.06 Assignments and Participations 50
10.07 Survival 51
10.08 Captions 52
10.09 Counterparts 52
10.10 Governing Law; Submission to Jurisdiction 52
10.11 Waiver of Jury Trial 52
10.12 Treatment of Certain Information 52
10.13 Brokers and Financial Advisors 53
10.14 Lender's Discretion 53
10.15 Severability 53
10.16 Preferences 53
10.17 Waiver of Notice 54
10.18 Remedies of Borrower 54
(ii)
10.19 Waiver of Marshalling of Assets Defense 54
10.20 Waiver of Counterclaim 54
10.21 FINAL AGREEMENT 54
10.22 Tax Treatment 55
EXHIBIT A - Form of Note
EXHIBIT B - FFC Loan Agreement (without exhibits)
EXHIBIT C - Prohibited Transferees
EXHIBIT D - Form of Nonconsolidation Opinion
EXHIBIT E - FRP Loan Agreement (without exhibits)
(iii)
THIS CREDIT AGREEMENT dated as of September 1, 1995, is
made by and between FORUM GROUP, INC., an Indiana corporation
(the "Borrower"), having an address at ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and NOMURA ASSET CAPITAL
CORPORATION, a Delaware corporation (the "Lender"), having an
address at 2 World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
RECITALS:
The Borrower has requested that the Lender make from
time to time loans (each an "Advance"; collectively, the "Loan")
to the Borrower in an aggregate principal amount not exceeding
$50,000,000 (the "Loan Amount") and the Lender is prepared to
make such Advances upon the terms and conditions hereof.
Accordingly, the parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms. As used herein, the
following terms shall have the following meanings (all terms
defined in this Section 1.01 or in other provisions of this
Agreement in the singular to have the same meanings when used in
the plural and vice versa):
"Account Collateral" shall have the meaning provided in
Section 3.04 hereof.
"Actual Excess Cash Flow" shall mean, with respect to
the month immediately preceding a Payment Date on which a
Mandatory Payment is due, (a) Adjusted Net Cash Flow minus (b)
Facility Owner Debt Service minus (c) Debt Service of the Loan
for the immediately following Payment Date.
"Adjusted Net Cash Flow" shall mean, at any date of
determination and with respect to the Collateral Facilities, the
sum of (a) with respect to the Subsidiary Facilities, "Adjusted
Net Cash Flow" (as such term is defined in the FFC Loan
Agreement) with respect to the immediately preceding month and
(b) with respect to any Approved Facilities, a term having
substantially the same meaning with respect to a comparable time
period contained in an Approved Facility Loan Agreement.
"Advance" shall have the meaning provided in the
Recitals hereto.
"Advance Termination Date" shall mean September 1,
1999.
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"Affiliate" of any specified Person shall mean any
other Person controlling or controlled by or under common control
with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means
the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting
securities or other beneficial interests, by contract or
otherwise; and the terms "controlling" and "controlled" have the
meaning correlative to the foregoing.
"Agreement" shall mean this Credit Agreement, as the
same may from time to time hereafter be modified, supplemented or
amended.
"Annualized NOI" shall mean, at any date of
determination and with respect to the Collateral Facilities, the
amount equal to the sum of (a) Adjusted Net Cash Flow, calculated
for the twelve months ended on the last day of the preceding
calendar quarter and based on the financial statements delivered
to the Lender for such quarter and (b) if written approval is
received from the Lender by the Borrower, which approval is in
the Lender's sole discretion and may be conditioned on, among
other things, satisfactory security arrangements, 50% of the
annualized management fees of the Borrower from the Collateral
Facilities.
"Approved Facilities" shall mean (i) the facilities
owned by FRPI as of the date hereof and (ii) any facilities owned
by an Affiliate of the Borrower which the Lender, in its sole
discretion, approves as acceptable for inclusion as Collateral
Facilities for purposes of calculating the Quarterly Test
(thereby enabling the Borrower to increase the principal amount
of outstanding Advances) and regarding which the following
actions are taken for the benefit of the Lender: (a) the
delivery of Preferred Stock issued by the owner of such facility
(or, in the case of facilities owned by FRPI, Preferred Stock
issued by either FRPI or FRP); and (b) the implementation of a
cash management arrangement established by the owner of such
facility similar in substance to the arrangement provided for in
Section 3.03 hereof. Upon written notice from the Lender that
such facility is acceptable (in the case of facilities described
in clause (ii) above only) and the provisions of clauses (a) and
(b) above having been satisfied, such facility shall be included
as a Collateral Facility hereunder.
"Approved Facility Loan Agreement" shall mean (i) the
FRP Loan Agreement and (ii) any loan agreement between the owner
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of an Approved Facility (other than FRPI) and the Lender or an
Affiliate of the Lender.
"Bankruptcy Code" shall mean the Federal Bankruptcy
Code of 1978, as amended from time to time.
"Business Day" shall mean any day other than (i) a
Saturday or a Sunday, and (ii) a day on which federally insured
depository institutions in (x) New York or (y) the state in which
the Collateral Agent is located are authorized or obligated by
law, governmental decree or executive order to be closed. When
used with respect to the determination of LIBOR, "Business Day"
shall mean a day on which banks are open for dealing in foreign
currency and exchange in London.
"Capital Lease Obligations" shall mean, for any Person,
all obligations of such Person to pay rent or other amounts under
a lease of (or other agreement conveying the right to use)
Property to the extent such obligations are required to be
classified and accounted for as a capital lease on a balance
sheet of such Person under GAAP, and, for purposes of this
Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP.
"Closing Date" shall mean September 1, 1995.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
"Collection Accounts" shall mean, at any date of
determination, (a) with respect to Subsidiary Facilities,
"Collection Accounts" (as such term is defined in the FFC Loan
Agreement) and (b) with respect to any Approved Facilities, any
term having substantially the same meaning contained in an
Approved Facility Loan Agreement.
"Collection Banks" shall mean, at any date of
determination, (a) with respect to Subsidiary Facilities,
"Collection Banks" (as such term is defined in the FFC Loan
Agreement) and (b) with respect to any Approved Facilities, any
term having substantially the same meaning contained in an
Approved Facility Loan Agreement.
"Collateral Agent" shall mean the banking institution
at which the Lender establishes the Pledge Account.
"Collateral Facilities" shall mean, collectively,
Subsidiary Facilities and Approved Facilities.
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"Debt Service" shall mean, for any Payment Date, the
principal, if any, and interest payments that would be due and
payable on the Loan in accordance with the Note on such Payment
Date or otherwise in respect of the monthly period immediately
preceding such Payment Date.
"Default" shall mean an Event of Default or an event
that with notice or lapse of time or both would become an Event
of Default.
"Default Interest Period" shall mean, during any period
while any principal of any Advance or any other amount under this
Agreement, the Note or any other Loan Document is not paid when
due, each successive period within such period as the Lender
shall from time to time choose; provided that the first Default
Interest Period shall commence as of the date on which such
principal or other amount became due and each succeeding Default
Interest Period shall commence upon the expiry of the immediately
preceding Default Interest Period.
"Default Rate" shall mean, with respect to any Default
Interest Period, the per annum interest rate equal to the lesser
of (i) the maximum interest rate permitted by Legal Requirements
and (ii) the sum of LIBOR determined as of the immediately
preceding Interest Determination Date plus the Pricing Spread
plus 3%.
"Dollars" and "$" shall mean lawful money of the United
States of America.
"Environmental Claim" shall mean, with respect to any
Person, any written notice, claim, demand or other communication
(collectively, a "claim") by any other Person alleging or
asserting such first Person's liability for investigatory costs,
cleanup costs, governmental response costs, damages to natural
resources or other Property, personal injuries, fines or
penalties arising out of, based on or resulting from (i) the
presence, or Release into the environment, of any Hazardous
Material at any location, whether or not owned by such Person, or
(ii) circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law. The term "Environmental
Claim" shall include, without limitation, any claim by any
governmental authority for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any
applicable Environmental Law, and any claim by any third party
seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from the presence of
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Hazardous Materials or arising from alleged injury or threat of
injury to health, safety or the environment.
"Environmental Laws" shall mean any and all Federal,
state, local and foreign laws, rules or regulations, and any
orders or decrees, in each case as in effect on the relevant
date, relating to the regulation or protection of human health,
safety or the environment or to emissions, discharges, releases
or threatened releases of pollutants, contaminants, chemicals or
toxic or hazardous substances or wastes into the indoor or
outdoor environment (including, without limitation, ambient air,
soil, surface water, ground water, wetlands, land or subsurface
strata), or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, chemicals or toxic or
hazardous substances or wastes.
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade
or business that is a member of any group of organizations (i)
described in Section 414(b) or (c) of the Code of which the
Borrower is a member and (ii) solely for purposes of potential
liability under Section 302(c)(11) of ERISA and
Section 412(c)(11) of the Code and the lien created under
Section 302(f) of ERISA and Section 412(n) of the Code, described
in Section 414(m) or (o) of the Code of which the Borrower is a
member.
"Event of Default" shall have the meaning provided in
Section 8 hereof.
"Exit Fee" shall mean the fee, if any, payable by the
Borrower to the Lender pursuant to Section 3.01 hereof in an
amount equal to the product of (i) $1,400,000 multiplied by (ii)
the quotient of (A) $70,000,000 minus the Permanent Financing
Amount, but not less than zero, divided by (B) $70,000,000.
"Facility Owner" shall mean (i) FFC, (ii) FOH and (iii)
any owner of an Approved Facility, as applicable.
"Facility Owner Debt Service" shall mean, at any date
of determination and with respect to the Collateral Facilities,
the sum of (a) with respect to the Subsidiary Facilities, the
amount of "Debt Service" (as such term is defined in the FFC Loan
Agreement) which shall be due on the immediately succeeding
"Payment Date" (as such term is defined in the FFC Loan
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Agreement) and (b) with respect to any Approved Facilities, the
amount of a term having substantially the same meaning contained
in an Approved Facility Loan Agreement.
"FFC" shall mean FGI Financing I Corporation, a
Delaware corporation and a wholly owned subsidiary of the
Borrower.
"FFC Loan Agreement" shall mean the Loan Agreement
dated as of the date hereof, by and among FFC, FOH and the
Lender, a copy of which is attached hereto as Exhibit B.
"FGI SEC Reports" shall have the meaning provided in
Section 6.02 hereof.
"FOH" shall mean Forum Ohio Healthcare, Inc., an Ohio
corporation and a wholly owned subsidiary of the Borrower.
"Finder" shall have the meaning provided in Section
10.13 hereof.
"FRI" shall mean Forum Retirement, Inc., a Delaware
corporation and a wholly owned subsidiary of the Borrower.
"FRP" shall mean Forum Retirement Partners, L.P., a
Delaware limited partnership, the general partner of which is FRI
and the limited partners of which include the Borrower.
"FRP Loan Agreement" shall mean the Loan Agreement
dated as of December 28, 1993 by and between FRP and the Lender,
a copy of which is attached hereto as Exhibit E.
"FRPI" shall mean FRP Financing I, Limited Partnership,
a Delaware limited partnership, the general partner of which is
FRI and the sole limited partner of which is FRP.
"GAAP" shall mean United States generally accepted
accounting principles as in effect on the Closing Date applied on
a basis consistent with those that, in accordance with the last
sentence of Section 1.02(a) hereof, are to be used in making the
calculations for purposes of determining compliance with this
Agreement. In the event of a change in United States generally
accepted accounting principles after the Closing Date (a "GAAP
Change"), Borrower and the Lender shall endeavor to agree upon
appropriate amendments to the Loan Documents that would leave the
parties in the same relative economic position, giving effect to
such GAAP Change, in which they would have been had such GAAP
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Change not become effective. Pending such agreement, the GAAP
Change will not be effective for any purpose of this Agreement.
"Governmental Authority" means any national or federal
government, any state, regional, local or other political
subdivision thereof with jurisdiction and any Person with
jurisdiction exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to
government.
"Guarantee" shall mean, without duplication, a
guarantee, an endorsement, a contingent agreement to purchase or
to furnish funds for the payment or maintenance of, or otherwise
to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or
earnings of any Person, or a guarantee of the payment of
dividends or other distributions upon the stock or equity
interests of any Person, or an agreement to purchase, sell or
lease (as lessee or lessor) Property, products, materials,
supplies or services primarily for the purpose of enabling a
debtor to make payment of such debtor's obligations or an
agreement to assure a creditor against loss, and including,
without limitation, causing a bank or other financial institution
to issue a letter of credit or other similar instrument for the
benefit of another Person, but excluding endorsements for
collection or deposits or the guarantee of accounts payable in
the ordinary course of business. The amount of any Guarantee
shall equal the amount of the obligation so guaranteed or
otherwise supported. The terms "Guarantee" and "Guaranteed" used
as a verb shall have correlative meanings.
"Hazardous Material" shall mean, collectively, (a) any
petroleum or petroleum products, flammable materials, explosives,
radioactive materials, asbestos, urea formaldehyde foam
insulation, and transformers or other equipment that contain
polychlorinated biphenyls ("PCB's"), (b) any chemicals or other
materials or substances that are now or hereafter become defined
as or included in the definition of "hazardous substances",
"hazardous wastes", "hazardous materials", "extremely hazardous
wastes", "restricted hazardous wastes", "toxic substances",
"toxic pollutants", "contaminants", "pollutants" or words of
similar import under any Environmental Law and (c) any other
chemical or other material or substance, exposure to which is now
or hereafter prohibited, limited or regulated under any
Environmental Law.
"Indebtedness" shall mean, with respect to any Person
but without duplication: (a) obligations created, issued or
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incurred by such Person for borrowed money (whether by loan, the
issuance and sale of debt securities or the sale of Property to
another Person subject to an understanding or agreement,
contingent or otherwise, to repurchase such Property from such
Person); (b) obligations of such Person to pay the deferred
purchase or acquisition price of Property or services, other than
trade accounts payable (other than for borrowed money) arising,
and accrued expenses incurred, in the ordinary course of
business; (c) Indebtedness of others secured by a Lien on the
Property of such Person, whether or not the respective
indebtedness so secured has been assumed by such Person; (d)
obligations of such Person in respect of letters of credit or
similar instruments issued or accepted by banks and other
financial institutions for account of such Person (other than in
respect of workers' compensation or employee benefits); (e)
Capital Lease Obligations of such Person; and (f) any Guarantee
by such Person of any obligation referred to in clauses (a)
through (e).
"Interest Accrual Period" shall mean, with respect to a
Payment Date, the period commencing on and including the
preceding Payment Date (or in the case of the first Payment Date,
the initial date upon which an Advance is made hereunder) and
ending on and including the day preceding the Payment Date;
provided, however, that no Interest Accrual Period shall extend
beyond the day preceding the Maturity Date.
"Interest Determination Date" shall mean, with respect
to any Interest Reset Date, the date which is two Business Days
prior to such Interest Reset Date.
"Interest Reset Date" shall mean, with respect to the
period for which LIBOR has last been calculated, the eleventh day
of the calendar month in which such period for which LIBOR has
last been calculated ends, provided, however, that the first
Interest Reset Date shall be the date on which the initial
Advance is made hereunder.
"Legal Requirements" means all governmental statutes,
laws, rules, orders, regulations, ordinances, judgments, decrees
and injunctions of Governmental Authorities (including without
limitation Environmental Laws) applicable to a referenced Person
(whether now or hereafter enacted and in force), and all permits,
licenses and authorizations and regulations relating thereto.
"LIBOR" shall mean, with respect to any Interest Reset
Date, the rate (expressed as a percentage per annum) for deposits
in U.S. Dollars for a 30-day, 60-day or 90-day period, as
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selected by Borrower in accordance with Section 4.02, that
appears on Telerate Page 3750 as of 11:00 a.m., London time, on
the applicable Interest Determination Date for such Interest
Reset Date. If such rate does not appear on Telerate Page 3750
as of 11:00 a.m., London time, on the applicable Interest
Determination Date, LIBOR will be the arithmetic mean of the
offered rates (expressed as a percentage per annum) for deposits
in U.S. Dollars for a 30-day, 60-day or 90-day period, as
selected by Borrower in accordance with Section 4.02, that appear
on the Reuters Screen LIBO Page as of 11:00 a.m., London time, on
such Interest Determination Date, if at least two such offered
rates so appear. If fewer than two such offered rates appear on
the Reuters Screen LIBO Page as of 11:00 a.m., London time, on
such Interest Determination Date, Lender will request the
principal London office of any four major reference banks in the
London interbank market selected by Lender to provide such bank's
offered quotation (expressed as a percentage per annum) to prime
banks in the London interbank market for deposits in U.S. Dollars
for a 30-day, 60-day or 90-day period, as selected by Borrower in
accordance with Section 4.02, as of 11:00 a.m. London time, on
such Interest Determination Date for amounts of not less than
U.S. $1,000,000. If at least two such offered quotations are so
provided, LIBOR will be the arithmetic mean of such quotations.
If fewer than two such quotations are so provided, Lender will
request any three major banks in New York City selected by Lender
to provide such bank's rate (expressed as a percentage per annum)
for loans in U.S. Dollars to leading European banks for a 30-day,
60-day or 90-day period, as selected by the Borrower, as of
approximately 11:00 a.m., New York City time on the applicable
Interest Determination Date for amounts of not less than U.S.
$1,000,000. If at least two such rates are so provided, LIBOR
will be the arithmetic mean of such rates. If fewer than two
rates are so provided, then LIBOR will be LIBOR in effect on the
preceding Interest Reset Date.
"Lien" shall mean, with respect to any Property, any
mortgage, lien, pledge, charge, security interest or encumbrance
of any kind in respect of such Property. For purposes of this
Agreement and the other Loan Documents, a Person shall be deemed
to own subject to a Lien any Property that it has acquired or
holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title
retention agreement (other than an operating lease) relating to
such Property.
"Loan Amount" shall have the meaning provided in the
Recitals hereto.
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"Loan Documents" shall mean, collectively, this
Agreement, the Note and the Security Documents.
"Loan" shall have the meaning provided for in the
Recitals hereto.
"Mandatory Payment" shall mean, with respect to any
Payment Date:
(a) during the Non-Prepayment Period, if the Borrower
has used less than 100% of the proceeds of the Advances for
the purpose of completing expansions of Collateral
Facilities, the greater of: (x) the product of (A) .75 and
(B) Actual Excess Cash Flow, and (y) the lesser of (i) the
Principal Amortization Amount for such Payment Date
(calculated pursuant to the Quarterly Test on the related
Test Date on which such Quarterly Test was not satisfied)
and (ii) Actual Excess Cash Flow; or
(b) during the Non-Prepayment Period, if the Borrower
has used 100% of the proceeds of the Advances for the
purpose of completing expansions of Collateral Facilities,
or after the Non-Prepayment Period, Actual Excess Cash Flow.
"Margin Stock" shall mean "margin stock" within the
meaning of Regulations G, T, U and X.
"Material Adverse Effect" shall mean a material adverse
effect on (a) the business, financial position or results of
operations of the Borrower and its Subsidiaries taken as a whole,
(b) the ability of the Borrower to perform, or the Lender to
enforce, any of the Loan Documents, or (c) the ability of the
Borrower to make timely payment of the principal of or interest
on the Advances or other amounts payable in connection therewith.
"Maturity Date" shall mean January 1, 2001.
"Multiemployer Plan" shall mean a multiemployer plan
defined as such in Section 3(37) of ERISA to which contributions
have been made by the Borrower or any ERISA Affiliate and that is
covered by Title IV of ERISA.
"Non-Prepayment Period" shall have the meaning ascribed
to such term in the FFC Loan Agreement.
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"Note" shall mean the promissory note provided for by
Section 2.03 hereof and all promissory notes delivered in
substitution or exchange therefor, in each case as the same shall
be modified and supplemented and in effect from time to time.
"Operating Expense Amount" shall mean the sum of the
following as determined in good faith by the Borrower with
respect to the month in which such amount is being calculated:
(i) the amount of "Operating Expenses" (as defined in the FFC
Loan Agreement and (ii) the amount of a term having substantially
the same meaning contained in any Approved Facility Loan
Agreement.
"Outstanding Principal Cap" shall mean the following
Dollar amounts determined in accordance with the following
schedule:
Period Outstanding Principal Cap
------ -------------------------
Closing Date through September, 30, 1995 $3,000,000
October 1, 1995 through December 31, 1995 $8,000,000
January 1, 1996 through March 31, 1996 $18,000,000
April 1, 1996 through June 30, 1996 $28,000,000
July 1, 1996 through September 30, 1996 $38,000,000
October 1, 1996 through December 31, 1996 $45,000,000
January 1, 1997 and thereafter $50,000,000
"Payment Date" shall have the meaning provided in
Section 3.02 hereof.
"PBGC" shall mean the Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its
functions under ERISA.
"PCB's" shall have the meaning ascribed to such term in
the definition of "Hazardous Materials."
"Permanent Financing Amount" shall mean, at any date of
determination, the aggregate original principal amount of
permanent financing provided by the Lender or any of its
Affiliates (or any syndicate of lenders for which the Lender or
any of its Affiliates acts as agent) to the Borrower or any
Affiliate thereof after the Closing Date (other than pursuant to
this Agreement or the FFC Loan Agreement) and secured by any
Collateral Facilities (or, to the extent not included in the
Collateral Facilities, any facilities of FRPI). The Lender shall
determine in good faith the amount of permanent financing with a
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maturity of a significant duration, using commercial mortgage
finance industry standards.
"Permitted Junior Securities" shall have the meaning
provided in Section 9.03(b) hereof.
"Person" shall mean any individual, corporation,
company, voluntary association, partnership, limited liability
company, joint venture, trust, unincorporated organization or
government (or any agency, instrumentality or political
subdivision thereof).
"Plan" shall mean an employee benefit or other plan
established or maintained by the Borrower or any ERISA Affiliate
and that is covered by Title IV of ERISA, other than a
Multiemployer Plan.
"Pledge Account" shall have the meaning provided in
Section 3.03 hereof.
"Preferred Stock" shall mean preferred stock of a
Facility Owner, having in the aggregate the following terms and
provisions:
(a) a cumulative cash dividend payable on each Payment
Date;
(b) a dividend rate equal to the interest rate on the
Loan reduced by the amount of interest actually so paid
thereunder;
(c) a liquidation preference equal to the principal
amount of the Advances from time to time outstanding,
accrued and unpaid interest thereon and all other amounts
due under the Loan Documents;
(d) mandatory redemptions in an amount equal to the
outstanding principal amount of the Loan, at a redemption
price equal to such principal amount;
(e) upon the occurrence and during the continuance of
a Triggering Event, voting rights in favor of the Lender to
elect not less than a majority of the board of directors;
(f) prior to such time as a Triggering Event occurs,
express terms negating dividend, liquidation preference,
mandatory redemption and voting rights specified in (a)-(e)
above;
-13-
(g) terms providing that the issuer of the Preferred
Stock shall not issue any other class of preferred stock or
other equity interest with a liquidation preference senior
to the Preferred Stock of such issuer to any Person or any
additional Preferred Stock to any Person (other than the
Lender); and
(h) terms providing that such issuer of the Preferred
Stock shall not incur any Indebtedness or Liens other than
those expressly permitted by this Agreement, the FFC Loan
Agreement or the Approved Facility Loan Agreements or
approved by the Lender in writing in its sole discretion.
Any Preferred Stock issued by a corporation may take the form of
a master share of such preferred stock issued on the initial
Advance Date with respect to the applicable Facility Owner.
Notwithstanding the foregoing, (i) in the event an owner of an
Approved Facility (other than FRPI) shall take the form of a
limited liability company or limited partnership, then references
to "Preferred Stock" shall mean special membership interests or
special limited partnership interests, respectively, of such
owner which have the same terms and provisions as those set forth
above and (ii) in the case of FRPI, "Preferred Stock" shall mean
special limited partnership interests of either FRPI or FRP.
"Preferred Stock Terms" shall mean (i) in the case of a
Facility Owner which is a corporation, a certificate of
designation, amendment to the certificate of incorporation or
other corporate action which implements the terms and provisions
of the Preferred Stock or (ii) in the case of a Facility Owner
which is a limited liability company or limited partnership,
provisions of or amendments to the operating agreement or limited
partnership agreement, respectively, which implement such terms
and provisions.
"Pricing Spread" shall mean 5.00% per annum.
"Prohibited Transferees" shall mean the Persons listed
on Exhibit C hereto.
"Property" shall mean any right or interest in or to
property of any kind whatsoever, whether real, personal or mixed
and whether tangible or intangible.
"Quarterly Funding Cap" shall mean the following Dollar
amounts determined in accordance with the following schedule:
-14-
Period Quarterly Funding Cap
------ ---------------------
Closing Date through
September 30, 1995 $ 3,000,000
October 1, 1995 through
December 31, 1995 $ 5,000,000
January 1, 1996 through
March 31, 1996 $10,000,000
April 1, 1996 through
June 30, 1996 $10,000,000
July 1, 1996 through
September 30, 1996 $10,000,000
October 1, 1996 through
December 31, 1996 $ 7,000,000
January 1, 1997 through
March 31, 1997 and
each subsequent calendar
quarter through the Advance
Termination Date $ 5,000,000
"Quarterly Test" shall mean the test used to determine
whether the Borrower may receive an Advance or Advances during
the applicable three month period under Section 5.02 or shall
make Mandatory Payments pursuant to Section 2.05. The
methodology of the Quarterly Test is to be performed, with
respect to the current Test Date, as follows:
I. Determine Annualized NOI of the Collateral
Facilities.
II. Divide Annualized NOI of the Collateral
Facilities by twelve to determine gross monthly net
operating income ("Gross Monthly NOI").
III. Subtract Facility Owner Debt Service from Gross
Monthly NOI to determine net monthly net operating
income ("Net Monthly NOI").
IV. Subtract the interest component of Debt Service
on the Loan (calculated assuming the interest rate in
effect for such month equals the Treasury Rate plus
5.0% (the "Test Rate")) which shall be due on the
immediately succeeding Payment Date from Net Monthly
NOI to determine excess cash flow ("Excess Cash
Flow").
-15-
V. Multiply Excess Cash Flow by .75 to determine the
principal amortization amount ("Principal
Amortization Amount").
VI. Repeat steps I through V for the 35 (if
paragraph (a) below applies) or 47 (if paragraph (b)
below applies) following monthly periods assuming
that (i) the Principal Amortization Amount for each
preceding period is applied to reduce the outstanding
principal amount of the Loan and (ii) Gross Monthly
NOI and the Test Rate remain constant.
The Quarterly Test shall be satisfied for the
applicable Test Date:
(a) if, during the Non-Prepayment Period, the
Borrower has used less than 100% of the proceeds of the
Advances for the purpose of completing expansions of the
Collateral Facilities, or if, after the Non-Prepayment
Period, the sum of the 36 Principal Amortization Amounts
calculated in accordance with the above methodology is equal
to or greater than the outstanding principal amount of the
Loan; or
(b) if, during the Non-Prepayment Period, the
Borrower has used 100% of the proceeds of the Advances for
the purpose of completing expansions of the Collateral
Facilities, the sum of the 48 Principal Amortization Amounts
calculated in accordance with the above methodology is equal
to or greater than the outstanding principal amount of the
Loan.
"Rating Agencies" shall have the meaning provided in
the FFC Loan Agreement or any Approved Facility Loan Agreement,
as applicable.
"Release" shall mean any release, spill, emission,
leaking, pumping, injection, deposit, disposal, discharge,
dispersal, leaching or migration into the indoor or outdoor
environment, (including, without limitation, the movement of
Hazardous Materials through ambient air, soil, surface water,
ground water, wetlands, land or subsurface strata).
"Reuters Screen LIBO Page" shall mean the display
designated as page "LIBO" on the Reuters Monitor Money Rates
Service (or such other page as may replace the LIBO page on the
service for the purpose of displaying interbank rates from London
in U.S. Dollars).
-16-
"Security Documents" shall mean, collectively, all
Uniform Commercial Code financing statements to be filed with
respect to the security interests in the Pledge Account created
pursuant to Section 3.04.
"Senior Indebtedness" shall mean principal of,
premium, if any, and accrued and unpaid interest (including,
without limitation, interest at the contract rate subsequent to
the commencement of any bankruptcy, insolvency or similar
proceeding with respect to the Borrower), fees, expenses and all
other obligations on or with respect to all Indebtedness of the
Borrower or any of its Subsidiaries; provided, however, that
there shall be excluded from such term (a) any of the
Indebtedness evidenced by this Agreement, the Note or any other
Loan Document or (b) Indebtedness, if any, which, by the terms of
the instrument evidencing such Indebtedness or pursuant to which
it is issued, ranks equally with or is expressly made junior and
subordinate in right of payment to the Subordinated Amounts.
"Subordinated Amounts" shall have the meaning
provided in Section 9.01.
"Subsidiary" shall mean, with respect to any Person,
any corporation, partnership or other entity of which at least a
majority of the securities or other ownership interests having by
the terms thereof ordinary voting power to elect a majority of
the board of directors or other persons performing similar
functions of such corporation, partnership or other entity
(irrespective of whether or not at the time securities or other
ownership interests of any other class or classes of such
corporation, partnership or other entity shall have or might have
voting power by reason of the happening of any contingency) is at
the time directly or indirectly owned or controlled by such
Person or one or more Subsidiaries of such Person or by such
Person and one or more Subsidiaries of such Person.
"Subsidiary Facilities" shall mean the "Individual
Properties" (as defined in the FFC Loan Agreement).
"Telerate Page 3750" shall mean the display
designated as "Page 3750" on The Dow ▇▇▇▇▇ Telerate Service (or
such other page as may replace Page 3750 on that service or such
other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of
displaying British Bankers' Association Interest Settlement Rates
for U.S. Dollar deposits).
-17-
"Test Date" shall mean March 1, June 1, September 1
and December 1 of each calendar year, commencing December 1,
1995.
"Treasury Rate" shall mean the yield on the U.S.
Treasury issue (primary issue) with a maturity date closest to,
but not earlier than, the third anniversary of the date on which
such rate is calculated with such yield being based on the bid
price for such issue as published in The Wall Street Journal in
New York, New York on the date of calculation (or, if such bid
price is not published on that date, the next preceding date on
which such bid price is so published). In the event The Wall
Street Journal is no longer published or ceases to publish the
bid price for such U.S. Treasury issues, the Lender shall select
a comparable publication to determine the Treasury Rate.
"Triggering Event" shall mean the occurrence of an
Event of Default under this Agreement and the principal amount
and accrued interest on the Loan becoming due and payable (by
acceleration or otherwise).
1.02 Accounting Terms and Determinations.
(a) Except as otherwise expressly provided herein,
all accounting terms used herein shall be interpreted, and all
financial statements and certificates and reports as to financial
matters required to be delivered to the Lender hereunder shall
(unless otherwise disclosed to the Lender in writing at the time
of delivery thereof in the manner described in subsection (b)
below) be prepared, in accordance with GAAP applied on a basis
consistent with those used in the preparation of the latest
financial statements furnished to the Lender hereunder (which,
prior to the delivery of the first financial statements under
Section 7.01 hereof, shall mean the unaudited financial
statements as at June 30, 1995). All calculations made for the
purposes of determining compliance with this Agreement shall
(except as otherwise expressly provided herein) be made by
application of GAAP applied on a basis consistent with those used
in the preparation of the latest annual or quarterly financial
statements furnished to the Lender pursuant to Section 7.01
hereof.
(b) The Borrower shall deliver to the Lender at the
same time as the delivery of any annual or quarterly financial
statement under Section 7.01 hereof (i) a description in
reasonable detail of any material variation between the
application of accounting principles employed in the preparation
of such statement and the application of accounting principles
-18-
employed in the preparation of the next preceding annual or
quarterly financial statements and (ii) reasonable estimates of
the difference between such statements arising as a consequence
thereof.
Section 2. The Loan, Advances, Note and Prepayments.
2.01 The Loan. The Lender agrees, on the terms and
conditions of this Agreement, to make Advances to the Borrower in
Dollars during the period from and including the Closing Date to
but excluding the Advance Termination Date in an aggregate
principal amount up to but not exceeding the Loan Amount;
provided that the Lender shall not be required to make any
Advance which would cause either (x) the aggregate principal
amount of the Advances made during any calendar quarter to exceed
the applicable Quarterly Funding Cap or (y) the outstanding
aggregate principal amount of the Loan at any time to exceed the
applicable Outstanding Principal Cap.
2.02 Advances. The Borrower shall give the Lender
written notice of each Advance hereunder as provided in
Section 4.04 hereof. The Borrower may request no more than three
Advances in any three month period following a Test Date. The
Borrower shall certify as to the satisfaction or failure of the
Quarterly Test on each Test Date. On the date specified for each
Advance hereunder, the Lender shall, subject to the terms and
conditions of this Agreement, make available to the Borrower, in
immediately available funds, in an account of the Borrower
designated by the Borrower in the related notice of Advance, the
amount of such Advance minus the reasonable fees and
disbursements of counsel to the Lender.
2.03 Note.
(a) The Loan shall be evidenced by a single
promissory note of the Borrower substantially in the form of
Exhibit A hereto, dated the date hereof, payable to the Lender.
(b) The date and amount of each Advance made by the
Lender to the Borrower, and each payment made on account of the
principal thereof, shall be recorded by the Lender on its books
and, prior to any transfer of the Note, endorsed by the Lender on
the schedule attached to the Note or any continuation thereof;
provided that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of
the Borrower to make a payment when due of any amount owing
hereunder or under the Note in respect of the Loan.
-19-
(c) The Lender shall not be entitled to have the
Note substituted or exchanged for any reason, except in
connection with a permitted assignment of the Loan and Note
pursuant to Section 10.06 hereof (and, if requested by the
Lender, the Borrower agrees to so exchange the Note).
2.04 Optional Prepayments. Subject to Section 4.03
hereof, the Borrower shall have the right to prepay the Loan at
any time or from time to time (without penalty or premium),
provided that the Borrower shall give the Lender notice of each
such prepayment as provided in Section 4.04 hereof (and, subject
to the terms hereof, upon the date specified in any such notice
of prepayment, the amount to be prepaid shall become due and
payable hereunder).
2.05 Mandatory Prepayment.
In the event that the Quarterly Test is not satisfied
on any Test Date, the Borrower shall make a principal payment
equal to the Mandatory Payment to the Lender on each Payment Date
thereafter until the subsequent Test Date; provided, however,
that the obligation to make a Mandatory Payment shall cease upon
the Borrower having prepaid the principal amount of the Loan
outstanding by an amount such that the Quarterly Test would have
been satisfied on such preceding Test Date. On each Payment Date
on which the Borrower makes a Mandatory Payment, the Borrower
shall deliver to the Lender a statement describing in reasonable
detail the calculation of the principal amount of the Loan paid.
Section 3. Payments of Principal, Interest and Exit
Fee.
3.01 Repayment of the Loan. The Borrower hereby
promises to pay to the Lender the entire outstanding principal
amount of the Loan, and the Loan shall mature, on the Maturity
Date. In addition, the Borrower shall pay to the Lender (a) any
Mandatory Payments when due as required by Section 2.05 and (b)
the Exit Fee on the Maturity Date.
3.02 Interest. The Borrower hereby promises to pay
to the Lender interest on the unpaid principal amount of each
Advance for the period from and including the date of such
Advance to but excluding the date such Advance shall be paid in
full, at a rate per annum equal to LIBOR plus the Pricing Spread.
Notwithstanding the foregoing, the Borrower hereby promises to
pay to the Lender interest at the applicable Default Rate on any
principal of any Advance and on any other amount payable by the
Borrower hereunder or under the Note that shall not be paid in
-20-
full when due (whether at stated maturity, by acceleration, by
mandatory prepayment or otherwise), for the period from and
including the due date thereof to but excluding the date the same
is paid in full. Accrued interest on each Advance shall be
payable monthly in arrears on the 11th day of the month following
the initial Advance made hereunder, and on the eleventh day of
each and every month thereafter, unless, in any such case, such
day is not a Business Day, in which event such interest shall be
payable on the first Business Day following such date (such date
for any particular month, the "Payment Date"), except that
interest payable at the Default Rate shall be payable from time
to time on demand. Promptly after the determination of any
interest rate provided for herein or any change therein, the
Lender shall give notice thereof to the Borrower.
3.03 Cash Management. Commencing on the date of the
initial Advance hereunder, the Borrower shall cause each Facility
Owner to direct each of the Collection Banks pursuant to a letter
of instructions, upon receipt by the Collection Banks of the
notice given each month pursuant to Section 2.12(b) of the FFC
Loan Agreement (or, with respect to an Approved Facility, any
comparable notice given pursuant to the related Approved Facility
Loan Agreement), to transfer no later than 3:00 p.m. on a daily
basis any amounts in the Collection Accounts (i) first to an
account designated by the Borrower until an amount equal to the
Operating Expense Amount for such month has been transferred to
such account and (ii) then to an account at the Collateral Agent
(regarding which the Lender shall have provided the Borrower the
identity of the Collateral Agent and the account number) (the
"Pledge Account") until the earlier of (a) the first day of the
succeeding month or (b) the date upon which an amount has been
deposited in the Pledge Account sufficient to pay Debt Service
(including the Mandatory Payment, if any) for the succeeding
Payment Date. In the event that sufficient funds shall have been
deposited in the Pledge Account to satisfy Debt Service
(including the Mandatory Payment, if any) for the succeeding
Payment Date prior to the first day of the succeeding month,
Borrower shall cause each Facility Owner to direct the Collection
Banks to transfer any amounts deposited in the Collection
Accounts to an account designated by Borrower until the first day
of the succeeding month.
3.04 Security Agreement. To secure the full and
punctual payment of the Loan, the Borrower hereby pledges to the
Lender, and grants to the Lender a first and continuing security
interest in and to, the following property, whether now owned or
existing or hereafter acquired or arising and regardless of where
located (collectively, the "Account Collateral"):
-21-
(i) all of Borrower's right, title and interest in
the Pledge Account and all moneys, securities, instruments
and other amounts, if any, from time to time deposited or
held in the Pledge Account;
(ii) all interest, dividends, money, instruments and
other property from time to time received, receivable or
otherwise payable in respect of, or received in exchange
for, any of the foregoing; and
(iii) to the extent not covered by clauses (i) or
(ii) above, all proceeds (as defined under the Uniform
Commercial Code of the applicable jurisdiction) of any or
all of the foregoing.
Section 4. Payments; Computations; Etc.
4.01 Payments. (a) Except as otherwise
specifically provided herein, all payments and prepayments under
this Agreement and the Note shall be made to the Lender not later
than 12:00 noon, New York City time, on the date when due and
shall be made in lawful money of the United States of America in
federal or other immediately available funds to an account
specified to Borrower by Lender in writing, and any funds
received by Lender after such time shall, for all purposes
hereof, be deemed to have been paid on the next succeeding
Business Day.
(b) All payments made by Borrower hereunder shall be
made irrespective of, and without any deduction for, any set-offs
or counterclaims. Notwithstanding anything to the contrary
contained herein or in any other Loan Document, to the extent
that any payment or distribution is at any time made under or on
account of any of the Preferred Stock, the aggregate amount due
or to become due under this Agreement and the Note shall be
reduced by an amount equal to the amount of such payment or the
fair value of such distribution.
(c) All proceeds of any repayment, including
prepayments, of the Loan shall be applied to pay: first, any
reasonable out-of-pocket costs and expenses of Lender arising as
a result of such repayment; second, any accrued and unpaid
interest then payable with respect to the Loan or the portion
thereof being repaid; third, if applicable, Default Rate
interest, if any, on the Loan; fourth, the outstanding principal
amount of the Loan or the portion thereof being repaid and fifth,
any other amounts due and owing under the Loan Documents.
-22-
(d) If the due date of any payment under this
Agreement or the Note would otherwise fall on a day that is not a
Business Day, such date shall be extended to the next succeeding
Business Day, and interest shall be payable for any principal so
extended for the period of such extension.
4.02 Computations. (a) Interest on Advances shall
be computed on the basis of a year of 360 days and actual days
elapsed (i.e., interest for each day during which the Advances
are outstanding shall be computed at said rate divided by 360).
(b) Borrower shall notify Lender in writing by
3:00 p.m. (New York time) on each Interest Determination Date
whether LIBOR shall be calculated on the basis of a 30-day, 60-
day or 90-day period provided that in no event shall Borrower
select a period which extends beyond the Maturity Date; provided,
further, that upon the occurrence and during the continuance of
an Event of Default hereunder, Lender shall determine such basis.
In the event Borrower fails to notify Lender in accordance with
the immediately preceding sentence, LIBOR shall be calculated on
the same basis as during the immediately prior Interest Accrual
Period.
4.03 Minimum Amounts. Except for Mandatory Payments
made pursuant to Section 2.05 hereof, each Advance and partial
prepayment of principal of Advances shall be in an amount at
least equal to $100,000.
4.04 Certain Notices. Notices by the Borrower to
the Lender of Advances and optional prepayments of Advances shall
be effective only if received by the Lender not later than
10:00 a.m. New York time on the number of Business Days prior to
the date of the relevant Advance or prepayment specified below:
Number of
Business
Notice Days Prior
------ ----------
Advances 5
Prepayment of Advances 2
Each such notice of borrowing or optional prepayment shall
specify the amount (subject to Section 4.03 hereof) of each
Advance to be borrowed or prepaid and the date of Advance or
optional prepayment (which shall be a Business Day). Notices of
Advances shall be irrevocable; notices of prepayment shall also
be irrevocable except that such notices may be conditioned upon
the receipt of proceeds of any financing or sale.
-23-
4.05 Set-off. The Borrower agrees that, in addition
to (and without limitation of) any right of set-off, banker's
lien or counterclaim the Lender may otherwise have, the Lender
shall be entitled, at its option (to the fullest extent permitted
by law), to set off and apply any deposit (general or special,
time or demand, provisional or final), or other indebtedness,
held by it for the credit or account of the Borrower at any of
its offices, in Dollars or in any other currency, against any
principal of or interest on any of the Advances or any other
amount payable to the Lender hereunder, that is not paid when due
(regardless of whether such deposit or other indebtedness are
then due to the Borrower), in which case it shall promptly notify
the Borrower thereof.
4.06 Illegality. Notwithstanding any other
provision of this Agreement, in the event that it becomes
unlawful for the Lender to honor its obligation to make future
Advances hereunder, then the Lender shall promptly notify the
Borrower thereof and the Lender's obligation to make Advances
shall be suspended until such time as the Lender may again make
and maintain Advances.
4.07 Compensation. The Borrower shall pay to the
Lender, upon the request of the Lender, such amount or amounts
calculated in accordance with this Section 4.07 to compensate it
for any loss, cost or expense attributable to:
(a) any payment or mandatory or optional prepayment
of an Advance on a date other than the last day of the
Interest Accrual Period for such Advance; or
(b) any failure by the Borrower for any reason
(including, without limitation, the failure of any of the
conditions precedent specified in Section 5 hereof to be
satisfied) to borrow an Advance on the date for such
borrowing specified in the relevant notice of borrowing
given pursuant to Section 2.02 hereof.
Such compensation shall be an amount equal to the excess, if any,
of (i) the amount of interest that otherwise would have accrued
on the principal amount so paid, prepaid or not borrowed for the
period from the date of such payment, prepayment or failure to
borrow to the last day of the then current Interest Accrual
Period for such Advance (or, in the case of a failure to borrow,
the Interest Accrual Period for such Advance that would have
commenced on the date specified for such borrowing) at the
applicable rate of interest for such Advance provided for herein
over (ii) the amount of interest that otherwise would have
-24-
accrued on such principal amount at a rate per annum equal to the
interest component of the amount the Lender would have bid in the
London interbank market for Dollar deposits of leading banks in
amounts comparable to such principal amount and with maturities
comparable to such period (as reasonably determined by the
Lender, or if the Lender shall cease to make such bids, the
equivalent rate, as reasonably determined by the Lender, derived
from Telerate Page 3750, Reuters LIBO Page or other publicly
available source as described in the definition of "LIBOR" in
Section 1.01 hereof).
Section 5. Conditions Precedent.
5.01 Closing Date. The obligation of the Lender to
execute and deliver this Agreement hereunder is subject to the
conditions precedent that the Lender shall have received the
following documents, each of which shall be satisfactory to the
Lender in form and substance:
(a) Corporate Documents. Certified copies of the
charter and by-laws (or equivalent documents) of the
Borrower and of all corporate authority for the Borrower
(including, without limitation, board of director or
executive committee resolutions and evidence of the
incumbency, including specimen signatures, of officers) with
respect to the execution, delivery and performance of the
Loan Documents and each other document to be delivered by
the Borrower from time to time in connection herewith and
the Advances hereunder (and the Lender may conclusively rely
on such certificate until it receives notice in writing from
the Borrower to the contrary).
(b) Officer's Certificate. A certificate of a
senior officer of the Borrower, dated the Closing Date, to
the effect set forth in the first sentence of Section 5.02
hereof (except as to 5.02(c)).
(c) Opinion of Counsel to the Borrower. An opinion,
dated the Closing Date, of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇,
counsel to the Borrower, covering such matters as the Lender
may reasonably request (and the Borrower hereby instructs
such counsel to deliver such opinion to the Lender).
(d) Note. The Note, duly completed and executed.
(e) Other Documents. Such other documents as the
Lender or special New York counsel to the Lender may
reasonably request.
-25-
The obligation of the Lender to execute and deliver this
Agreement is also subject to the payment or provision for payment
by the Borrower of such fees as the Borrower shall have agreed to
pay or deliver to the Lender in connection herewith (including,
without limitation, the reasonable fees and expenses of Milbank,
Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, special New York counsel to the Lender),
in connection with the negotiation, preparation, execution and
delivery of this Agreement and the Note and the other Loan
Documents and the making of the Advances hereunder (to the extent
that statements for such fees and expenses have been delivered to
the Borrower).
5.02 Initial and Subsequent Advances. The
obligation of the Lender to make any Advance to the Borrower upon
the occasion of each Advance hereunder (including the initial
Advance) is subject to the further conditions precedent that,
both immediately prior to the making of such Advance and also
after giving effect thereto and to the intended use thereof:
(a) no Default shall have occurred and be
continuing;
(b) the representations and warranties made by the
Borrower in Section 6 hereof, and in each of the other Loan
Documents, shall be true and correct in all material
respects on and as of the date of the making of such Advance
with the same force and effect as if made on and as of such
date (or, if any such representation or warranty is
expressly stated to have been made as of a specific date, as
of such specific date);
(c) the Quarterly Test shall have been satisfied as
of the most recent Test Date; and
(d) no law or regulation shall have been adopted, no
order, judgment or decree of any Governmental Authority
shall have been issued, and no litigation shall be pending
or, to the knowledge of the executive officers of the
Borrower, threatened, which would enjoin, prohibit or
restrain, or impose or result in the imposition of any
material adverse condition upon, the making or repayment of
the Loan or the consummation of this Agreement.
Each notice of Advance by the Borrower hereunder shall constitute
a certification by the Borrower to the effect set forth in the
preceding sentence (both as of the date of such notice and,
unless the Borrower otherwise notifies the Lender in writing
prior to the date of such Advance, as of the date of such
-26-
Advance). The obligation of the Lender to make each Advance
hereunder is also subject to the delivery to the Lender of the
following documents prior to the making of such Advance:
(a) Preferred Stock of each Facility Owner (or, if
applicable hereunder, of FRP) registered in the name of the
Lender together with a copy of the applicable Preferred
Stock Terms (except to the extent that Preferred Stock of
such Facility Owner (or, if applicable hereunder, of FRP)
shall have theretofore been delivered to the Lender
hereunder);
(b) concurrently with each delivery of Preferred
Stock pursuant to clause (a) above, an opinion of counsel to
the Borrower addressed to the Lender to the effect that (i)
the Preferred Stock so delivered to the Lender is duly
authorized, validly issued, fully paid and non-assessable
(to the extent applicable) and (ii) in the event that the
Borrower becomes a debtor under the Bankruptcy Code, such
Preferred Stock would not be determined to constitute
property of the Borrower's estate under Section 541 of the
Bankruptcy Code; and
(c) with respect to the initial Advance only, (i) an
opinion of counsel to the Borrower addressed to the Lender,
to the effect that to the knowledge of such counsel the
issuance of the shares of Preferred Stock so delivered to
the Lender do not violate any agreements to which any
Facility Owner is a party and (ii) a nonconsolidation
opinion of counsel to the Borrower addressed to the Rating
Agencies and the Lender in substantially the form attached
as Exhibit D hereto.
Section 6. Representations and Warranties. The
Borrower represents and warrants to the Lender that:
6.01 Corporate Existence. The Borrower and each
Facility Owner is a corporation, limited liability company or
limited partnership duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization.
Each Facility Owner (a) has all requisite corporate or
partnership power, and has all material governmental licenses,
authorizations, consents and approvals, necessary to own its
assets and carry on its business as now being or as proposed to
be conducted and (b) is qualified to do business and is in good
standing in all jurisdictions in which the nature of the business
conducted by it makes such qualification necessary and where
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failure so to qualify is reasonably likely to (either
individually or in the aggregate) have a Material Adverse Effect.
6.02 Financial Condition. The Borrower has
delivered to the Lender the audited consolidated financial
statements of the Borrower, and the unaudited consolidated
financial statements of the Borrower required to be delivered
pursuant to Section 7.01 hereof. All audited financial
statements have been prepared by a "Big Six" accounting firm,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & Company or another firm acceptable to the
Lender in its sole discretion. Since the delivery of such data,
except as otherwise disclosed in writing to the Lender, there has
been no change in the financial position of the Borrower or its
Subsidiaries or in the results of operations of the Borrower or
its Subsidiaries which change is reasonably likely to have a
Material Adverse Effect. No Facility Owner has incurred any
obligation or liability, contingent or otherwise, not reflected
in such financial data or in the materials which the Borrower
periodically files with the Securities and Exchange Commission
(the "FGI SEC Reports") which is reasonably likely to have a
Material Adverse Effect.
6.03 Litigation. Except as disclosed in the FGI SEC
Reports, there are no legal or arbitral proceedings, or any
proceedings by or before any governmental or regulatory authority
or agency, now pending or (to the knowledge of the executive
officers of the Borrower) threatened against the Borrower or any
Facility Owner that, if adversely determined, is reasonably
likely to (either individually or in the aggregate) have a
Material Adverse Effect.
6.04 No Breach. None of the execution and delivery
of this Agreement and the Note and the other Security Documents,
the consummation of the transactions herein and therein
contemplated or compliance with the terms and provisions hereof
and thereof will conflict with or result in a breach of, or
require any consent under, the charter or by-laws of the
Borrower, or any applicable law or regulation, or any order,
writ, injunction or decree of any court or governmental authority
or agency, or any material agreement or instrument to which the
Borrower is a party or by which it or any Property of any
Facility Owner is bound or to which any Facility Owner is
subject, or constitute a default under any such agreement or
instrument, or (except for the Liens created pursuant to Section
3.04 hereof) result in the creation or imposition of any Lien
upon any Property of Facility Owner pursuant to the terms of any
such agreement or instrument.
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6.05 Action. The Borrower has all necessary
corporate power and authority to execute, deliver and perform its
obligations under each of the Loan Documents. The execution,
delivery and performance by the Borrower of each of the Loan
Documents have been duly authorized by all necessary corporate
action on its part. This Agreement has been duly and validly
executed and delivered by the Borrower and constitutes, and each
of the Note and the other Loan Documents when executed and
delivered (in the case of the Note, for value) will constitute,
its valid and binding obligation, enforceable against the
Borrower in accordance with its terms, except as such
enforceability may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or similar laws
of general applicability affecting the enforcement of creditors'
rights and (b) the application of general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law).
6.06 Approvals. No authorizations, approvals or
consents of, and no filings or registrations with, any
governmental or regulatory authority or agency, or any securities
exchange, are a condition to the execution, delivery or
performance by the Borrower of this Agreement or any of the other
Loan Documents or for the legality, validity or enforceability
hereof or thereof, except for filings and recordings in respect
of the Liens created pursuant to the Security Documents.
6.07 Use of Credit. None of the Borrower or any
Facility Owner is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose,
whether immediate, incidental or ultimate, of buying or carrying
Margin Stock, and no part of the proceeds of the Advances
hereunder will be used to buy or carry any Margin Stock.
6.08 ERISA. The assets of the Borrower are not
"plan assets" under regulations currently promulgated under
ERISA. As of the date of each Advance, each Plan covering
employees of the Borrower or any Facility Owner, and, to the
knowledge of the executive officers of Borrower, each
Multiemployer Plan covering employees of the Borrower or any
Facility Owner, is in compliance in all material respects with,
and has been administered in all material respects in compliance
with, the applicable provisions of ERISA, the Code and any other
Federal or State law, and no event or condition has occurred and
is continuing as to which the Borrower would be under an
obligation to furnish a report to the Lender under
Section 7.01(e) hereof; provided, however, that with respect to
the Borrower only, this representation and warranty shall apply
-29-
only to the extent, if any, that a failure of the subject matter
of such representation and warranty to be true and correct would
result in joint and several liability with the Borrower on the
part of any Facility Owner.
6.09 Taxes. The Borrower and any Facility Owner (x)
are members of an affiliated group of corporations filing
consolidated returns for Federal income tax purposes, of which
the Borrower is the "common parent" (within the meaning of
Section 1504 of the Code) of such group, (y) have filed or had
filed on their behalf all Federal income tax returns and all
other material tax returns that are required to be filed by them
prior to the date of each Advance and (z) have paid all taxes
shown to be due pursuant to such returns or pursuant to any valid
assessment received by any of them; provided, however, that with
respect to the Borrower only, this representation and warranty
shall apply only to the extent, if any, that a failure of the
subject matter of such representation and warranty to be true and
correct would result in joint and several liability with the
Borrower on the part of any Facility Owner.
6.10 Investment Company Act. None of the Borrower
or any Facility Owner is an "investment company", or a company
"controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended.
6.11 Public Utility Holding Company Act. None of
the Borrower or any Facility Owner is a "holding company", or an
"affiliate" of a "holding company" or a "subsidiary company" of a
"holding company", within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
6.12 Ownership of Stock or Partnership Interests.
Except for any Preferred Stock issued in accordance herewith (and
any limited partnership interests in FRP not owned by the
Borrower), each Facility Owner is a direct or indirect wholly
owned subsidiary of the Borrower. All of the outstanding
Preferred Stock is duly authorized, validly issued, fully paid
and nonassessable (to the extent applicable), without any
personal liability attaching to the ownership thereof, and has
not been issued in violation of any preemptive rights of
stockholders or partners, and is owned of record by the Lender
(except to the extent that the Lender shall have effected a
change in such record ownership subsequent to the delivery
thereof to the Lender hereunder), free and clear of all liens,
security interests, pledges, charges, encumbrances, stockholders'
agreements and voting trusts imposed by or resulting from any
action of Borrower or its Affiliates. Except for the
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contemplated issuance of Preferred Stock in accordance with the
provisions hereof, there is no commitment, plan or arrangement to
issue, and no outstanding option, warrant or other right calling
for the issuance of, any Preferred Stock or any security or other
instrument which by its terms is convertible into, exercisable
for or exchangeable for such Preferred Stock.
6.13 Environmental Matters. Each Facility Owner has
obtained all environmental, health and safety permits, licenses
and other authorizations required under all Environmental Laws to
carry on its business as now being or as proposed to be
conducted, except to the extent failure to have any such permit,
license or authorization would not (either individually or in the
aggregate) have a Material Adverse Effect. Each of such permits,
licenses and authorizations is in full force and effect and each
Facility Owner is in compliance with the terms and conditions
thereof, and is also in compliance with all other limitations,
restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in any applicable
Environmental Law or in any regulation, code, plan, order,
decree, judgment, injunction, notice or demand letter issued,
entered, promulgated or approved thereunder, except to the extent
failure to comply therewith is not reasonably likely to (either
individually or in the aggregate) have a Material Adverse Effect.
In addition, except as disclosed in writing to the
Lender (whether before or after the date hereof):
(a) No notice, notification, demand, request for
information, citation, summons or order has been issued, no
complaint has been filed, no penalty has been assessed and
no investigation or review is pending or, to the knowledge
of the executive officers of the Borrower, threatened by any
governmental or other entity with respect to any alleged
failure by any Facility Owner to have any environmental,
health or safety permit, license or other authorization
required under any Environmental Law in connection with the
conduct of the business of any Facility Owner or with
respect to any generation, treatment, storage, recycling,
transportation, discharge or disposal, or any Release of any
Hazardous Materials generated by any Facility Owner.
(b) No Facility Owner owns, operates or leases a
treatment, storage or disposal facility requiring a permit
under the Resource Conservation and Recovery Act of 1976, as
amended, or under any comparable state or local statute; and
-31-
(i) no PCB's are present at any site or
facility now owned, operated or leased by any
Facility Owner;
(ii) no asbestos or asbestos-containing
materials is present at any site or facility owned,
operated or leased by any Facility Owner;
(iii) there are no underground storage
tanks or surface impoundments for Hazardous
Materials, active or abandoned, at any site or
facility owned, operated or leased by any Facility
Owner;
(iv) no Hazardous Materials have been
Released at, on or under any site or facility owned,
operated or leased by any Facility Owner in a
reportable quantity established by statute,
ordinance, rule, regulation or order; and
(v) no Hazardous Materials have been
otherwise Released at, on or under any site or
facility owned, operated or leased by any Facility
Owner that would (either individually or in the
aggregate) have a Material Adverse Effect.
(c) No Facility Owner has transported or arranged
for the transportation of any Hazardous Material to any
location that is listed on the National Priorities List
("NPL") under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended
("CERCLA"), listed for possible inclusion on the NPL by the
Environmental Protection Agency in the Comprehensive
Environmental Response and Liability Information System, as
provided for by 40 C.F.R. 300.5 ("CERCLIS"), or on any
similar state or local list or that is the subject of
Federal, state or local enforcement actions or other
investigations that are reasonably likely to lead to
Environmental Claims against any Facility Owner.
(d) No Hazardous Material generated by any Facility
Owner has been recycled, treated, stored, disposed of or
Released by any Facility Owner at any location except in
conformity with applicable Environmental Law.
(e) No written notification of a Release of a
Hazardous Material has been filed by or on behalf of any
Facility Owner and no site or facility owned, operated or
leased by any Facility Owner is listed or proposed for
-32-
listing on the NPL, CERCLIS or any similar state list of
sites requiring investigation or clean-up.
(f) No Liens have arisen under or pursuant to any
Environmental Laws on any site or facility owned, operated
or leased by any Facility Owner, and no government action
has been taken or is in process that is reasonably likely to
subject any such site or facility to such Liens and no
Facility Owner would be required to place any notice or
restriction relating to the presence of Hazardous Materials
at any site or facility owned by it in any deed to the real
property on which such site or facility is located.
(g) All environmental investigations, studies,
audits, tests, reviews or other analyses conducted by or
that are in the possession of any Facility Owner in relation
to facts, circumstances or conditions at or affecting any
site or facility owned, operated or leased by any Facility
Owner and that is reasonably likely to result in a Material
Adverse Effect have been made available to the Lender.
6.14 FGI SEC Reports. The FGI SEC Reports filed
since January 1, 1994 complied as to form with all Legal
Requirements applicable to them. Except for matters disclosed in
a subsequent FGI SEC Report, no FGI SEC Report filed since
January 1, 1994, as of the date of filing thereof, contained an
untrue statement of a material fact or omitted to state a
material fact necessary to make the statements made therein, in
light of the circumstances in which they were made, not
misleading.
6.15 Agreements. No Facility Owner is (x) a party
to any agreement or instrument or subject to any restriction
which is reasonably likely to have a Material Adverse Effect or
(y) in default in the performance, observance or fulfillment of
any of the obligations, covenants or conditions contained in any
agreement or instrument to which it is a party or by which it is
bound which default is reasonably likely to have a Material
Adverse Effect.
6.16 No Bankruptcy Filing. The Borrower is not
contemplating either the filing of a petition by it under any
state or federal bankruptcy or insolvency laws or the liquidation
of all or a major portion of the Borrower's assets or Property,
and the Borrower has no knowledge of any Person contemplating the
filing of any such petition against it.
-33-
6.17 Location of Chief Executive Offices. The
location of the Borrower's principal place of business and chief
executive office is ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or such other address as may be specified in a
notice given in accordance with Section 7.06.
6.18 Compliance. Each Facility Owner (x) complies
with all applicable Legal Requirements except for such failures
to comply which (individually or in the aggregate) are not
reasonably likely to have a Material Adverse Effect and (y) is
not in default or violation of any order, writ, injunction,
decree or demand of any governmental authority, the violation of
which is reasonably likely to have a Material Adverse Effect.
Section 7. Covenants of the Borrower. The Borrower
covenants and agrees with the Lender that, so long as any Advance
is outstanding and until payment in full of all amounts payable
by the Borrower hereunder:
7.01 Financial Statements Etc. The Borrower shall
deliver to the Lender:
(a) as soon as available and in any event within 45
calendar days after the end of each quarterly fiscal period
of each fiscal year of the Borrower ending after the date
hereof, consolidated statements of income, retained earnings
and cash flows of the Borrower and of each Facility Owner
for such period and for the period from the beginning of the
respective fiscal year to the end of such period, and the
related consolidated balance sheets of the Borrower and of
each Facility Owner as at the end of such period, setting
forth in each case in comparative form the corresponding
consolidated figures for the corresponding periods in the
preceding fiscal year (except that, in the case of balance
sheets, such comparison shall be to the last day of the
prior fiscal year), accompanied by a certificate of a senior
financial officer of the Borrower, which certificate shall
state that said consolidated financial statements present
fairly, in all material respects, the consolidated financial
condition and results of operations of the Borrower and such
Facility Owner, as the case may be, in conformity with GAAP,
as at the end of, and for, such period (subject to normal
year-end audit adjustments and the absence of notes,
schedules and other items customarily omitted from interim
period financial statements);
-34-
(b) as soon as available and in any event within 90
calendar days after the end of each fiscal year of the
Borrower ending after the date hereof, consolidated
statements of income, retained earnings and cash flows of
the Borrower and of each Facility Owner for such fiscal year
and the related consolidated balance sheets of the Borrower
and of each Facility Owner as at the end of such fiscal
year, setting forth in each case in comparative form the
corresponding consolidated figures for the preceding fiscal
year, and accompanied (i) in the case of said consolidated
statements and balance sheet of the Borrower, by an opinion
thereon of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & Company or another
independent certified public accountants of recognized
national standing, which opinion shall state that said
consolidated financial statements present fairly, in all
material respects, the consolidated financial condition and
results of operations of the Borrower as at the end of, and
for, such fiscal year in conformity with GAAP and (ii) in
the case of said consolidated statements and balance sheets
of a Facility Owner, by a certificate of a senior financial
officer of the Borrower, which certificate shall state that
said consolidated financial statements present fairly, in
all material respects, the consolidated financial condition
and results of operations of such Facility Owner, as at the
end of, and for, such fiscal year in conformity with GAAP;
(c) promptly upon their becoming available, copies
of all registration statements and regular periodic reports,
if any, that the Borrower shall have filed with the
Securities and Exchange Commission (or any governmental
agency substituted therefor) or any national securities
exchange (other than registration statements on Form S-8 or
similar forms and reports under Sections 13(d) and 16(a) of
the Securities and Exchange Act of 1934, as amended);
(d) promptly upon the mailing thereof to the
shareholders of the Borrower generally, copies of all
financial statements, reports and proxy statements so
mailed;
(e) as soon as possible, and in any event within ten
days, after an executive officer of the Borrower knows that
any of the events or conditions specified below with respect
to any Plan or Multiemployer Plan has occurred or exists, a
statement signed by a senior financial officer of the
Borrower setting forth details respecting such event or
condition and the action, if any, that the Borrower or its
ERISA Affiliate proposes to take with respect thereto (and a
-35-
copy of any report or notice required to be filed with or
given to the PBGC by the Borrower or an ERISA Affiliate with
respect to such event or condition):
(i) any reportable event, as defined in
Section 4043(b) of ERISA and the regulations issued
thereunder, with respect to a Plan, as to which the
PBGC has not by regulation waived the requirement of
Section 4043(a) of ERISA that it be notified within
30 days of the occurrence of such event (provided
that a failure to meet the minimum funding standard
of Section 412 of the Code or Section 302 of ERISA,
including, without limitation, the failure to make on
or before its due date a required installment under
Section 412(m) of the Code or Section 302(e) of
ERISA, shall be a reportable event regardless of the
issuance of any waivers in accordance with
Section 412(d) of the Code); and any request for a
waiver under Section 412(d) of the Code for any Plan;
(ii) the distribution under Section 4041
of ERISA of a notice of intent to terminate any Plan
or any action taken by the Borrower or an ERISA
Affiliate to terminate any Plan;
(iii) the institution by the PBGC of
proceedings under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by the Borrower
or any ERISA Affiliate of a notice from a
Multiemployer Plan that such action has been taken by
the PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal
from a Multiemployer Plan by the Borrower or any
ERISA Affiliate that results in liability under
Section 4201 or 4204 of ERISA (including the
obligation to satisfy secondary liability as a result
of a purchaser default) or the receipt by the
Borrower or any ERISA Affiliate of notice from a
Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA
or that it intends to terminate or has terminated
under Section 4041A of ERISA;
(v) the institution of a proceeding by a
fiduciary of any Multiemployer Plan against the
Borrower or any ERISA Affiliate to enforce
-36-
Section 515 of ERISA, which proceeding is not
dismissed within 30 days; and
(vi) the adoption of an amendment to any
Plan that, pursuant to Section 401(a)(29) of the Code
or Section 307 of ERISA, would result in the loss of
tax-exempt status of the trust of which such Plan is
a part if the Borrower or an ERISA Affiliate fails to
timely provide security to the Plan in accordance
with the provisions of said Sections;
(f) promptly after any executive officer of the
Borrower knows that any Default has occurred, a notice of
such Default describing the same in reasonable detail and,
together with such notice or as soon thereafter as possible,
a description of the action that the Borrower has taken or
proposes to take with respect thereto; and
(g) from time to time such other information
regarding the financial condition, operations, business or
prospects of the Borrower or any of its Subsidiaries
(including, without limitation, any Plan or Multiemployer
Plan and any reports or other information required to be
filed under ERISA) as the Lender may reasonably request.
The Borrower will furnish to the Lender, at the time it furnishes
each set of financial statements pursuant to paragraph (a) or (b)
above, a certificate of a senior financial officer of the
Borrower to the effect that, to the knowledge of such officer
after due inquiry, no Default has occurred and is continuing (or,
if any Default is known by such officer to have occurred and to
be continuing, describing the same in reasonable detail and
describing the action that the Borrower has taken or proposes to
take with respect thereto).
7.02 Litigation; Environmental Claims. The Borrower
will promptly give to the Lender notice of all legal or arbitral
proceedings, and of all proceedings by or before any governmental
or regulatory authority or agency, and any material development
in respect of such legal or other proceedings, affecting the
Borrower or any of its Subsidiaries, except proceedings that, if
adversely determined, are not reasonably likely to (either
individually or in the aggregate) have a Material Adverse Effect.
Without limiting the generality of the foregoing, the Borrower
will give to the Lender notice of the assertion of any
Environmental Claim by any Person against, or with respect to the
activities of, any Facility Owner and notice of any alleged
violation of or non-compliance with any Environmental Laws or any
-37-
permits, licenses or authorizations, other than any Environmental
Claim or alleged violation that, if adversely determined, is not
reasonably likely to (either individually or in the aggregate)
have a Material Adverse Effect.
7.03 Existence, Etc. The Borrower will:
(a) preserve and maintain its legal existence and
will cause any Facility Owner to preserve and maintain its
respective legal existence and material rights, privileges,
licenses and franchises (provided that nothing in this
Section 7.03 shall prohibit any transaction not prohibited
by Section 7.04 hereof);
(b) and will cause any Facility Owner to comply with
the requirements of all applicable laws, rules, regulations
and orders of governmental or regulatory authorities if
failure to comply with such requirements is reasonably
likely to (either individually or in the aggregate) have a
Material Adverse Effect; provided, however, that the
Borrower's obligations as to its compliance with such
requirements as aforesaid shall be limited to those
requirements that, if not complied with by the Borrower,
would result in joint and several liability with the
Borrower on the part of any Facility Owner;
(c) and will cause any Facility Owner to, pay and
discharge all taxes, assessments and governmental charges or
levies imposed on it or on its income or profits or on any
of its Property prior to the date on which penalties attach
thereto, except for any such tax, assessment, charge or levy
the payment of which is being contested in good faith and by
proper proceedings and against which adequate reserves are
being maintained; provided, however, that the Borrower's
obligations to pay and discharge such taxes, assessments,
charges or levies shall apply as aforesaid only to such
taxes, assessments, charges or levies that, if not paid and
discharged by the Borrower, would result in joint and
several liability with the Borrower on the part of any
Facility Owner;
(d) cause any Facility Owner to maintain its
respective material Properties used in their respective
businesses in good working order and condition, ordinary
wear and tear excepted;
-38-
(e) and will cause any Facility Owner to, keep
records and books of account in conformity with GAAP
consistently applied; and
(f) will cause any Facility Owner to, permit
representatives of the Lender, during normal business hours,
to examine, copy and make extracts from its books and
records, to inspect any of the Properties of any Facility
Owner, and to discuss its business and affairs with its
officers, all to the extent reasonably requested by the
Lender.
7.04 Prohibition of Fundamental Changes. The
Borrower will not (i) liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or (ii) permit any
Facility Owner to (x) enter into any transaction of merger or
consolidation or amalgamation or liquidate, wind up or dissolve
itself (or suffer any liquidation or dissolution), (y) convey,
sell, lease, transfer or otherwise dispose of, in one transaction
or a series of transactions, all or a substantial part of its
business or Property, whether now owned or hereafter acquired
(including, without limitation, receivables and leasehold
interests, but excluding (a) obsolete or worn-out Property, tools
or equipment no longer used or useful in its business, (b) any
inventory or other Property sold or disposed of in the ordinary
course of business and on ordinary business terms and (c) any
transaction permitted by Section 7.09), or (z) make any material
change in the nature of its business objectives, purposes or
operations.
7.05 Limitation on Liens. The Borrower will not,
nor will it permit any Facility Owner to, create or incur any
Lien upon any of the Preferred Stock.
7.06 Place of Business. The Borrower shall not
change its chief executive office or its principal place of
business without giving the Lender at least 30 calendar days'
prior written notice thereof and promptly providing the Lender
such information as the Lender may reasonably request in
connection therewith.
7.07 Perform Loan Documents. The Borrower shall
observe, perform and satisfy or cause any Facility Owner to
observe, perform and satisfy all the terms, provisions, covenants
and conditions required to be observed, performed or satisfied by
it.
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7.08 Dividend Payments. The Borrower shall cause
each Facility Owner to declare dividends or make other
distributions each month in an amount equal to the amount
transferred by the Collection Banks to the Pledge Account
pursuant to Section 3.03 hereof.
7.09 Sale or Transfer of Facilities. The Borrower
will not permit any Facility Owner to sell or transfer any of the
Collateral Facilities without, in any such case, the prior
written consent of the Lender, unless immediately following such
sale or transfer of the Quarterly Test would be satisfied (based
on a 36-month amortization).
7.10 Replacement of Manager. Subject to the rights
of the Lender or its assignee under the FFC Loan Agreement or any
Approved Facility Loan Agreement and subject to the prior
approval of the Rating Agencies, the Lender shall have the right
to designate a replacement manager for the Collateral Facilities
following the occurrence of an Event of Default of the type
described in clause (a) of Section 8 hereof. Such designation
right may be exercised by the Lender only upon 30 calendar days'
prior written notice to the Borrower, given after the occurrence
of such an Event of Default. Any successor manager so designated
by the Lender shall satisfy the criteria specified in Section
5.1(P) of the FFC Loan Agreement or comparable provision of an
Approved Facility Loan Agreement.
7.11 No Sale of Stock or Partnership Interests. The
Borrower will not sell, pledge, convey, assign its interest in or
otherwise transfer its ownership of the capital stock or
partnership interests of a Facility Owner, without in any such
case the prior written consent of the Lender.
7.12 Limitation on Issuance of Preferred Stock;
Cooperation with Rating Agencies. Prior to the repayment of the
Loan in full, (i) the Borrower shall not permit any Facility
Owner to issue Preferred Stock or any other equity interest with
a liquidation preference senior to the Preferred Stock of such
Facility Owner to any Person, other than the Lender and (ii) with
respect to FRPI, in the event the Preferred Stock shall be issued
by FRP, the Borrower shall not permit FRPI to issue Preferred
Stock or any other equity interest with a liquidation preference.
The Borrower shall cooperate fully with the Lender with respect
to the implementation of changes to the Preferred Stock Terms
requested by the Rating Agencies in connection with a
securitization of the mortgage loans executed pursuant to the FFC
Loan Agreement or any Approved Facility Loan Agreement; provided,
however, that no such changes shall materially adversely affect
-40-
the rights or materially increase the obligations of Borrower
under the Loan Documents or of any Facility Owner or FRP under
the terms of any such Preferred Stock.
7.13 Use of Proceeds. The Borrower shall use at
least 80% of the aggregate proceeds of the Advances hereunder for
expansions of the Collateral Facilities (in compliance with all
applicable legal and regulatory requirements, including, without
limitation, Regulations G, T, U and X and the Securities Act of
1933 and the Securities Exchange Act of 1934 and the regulations
thereunder). The Borrower shall use any proceeds of the Advances
which are not used for such expansions for any general corporate
purpose of the Borrower and its Subsidiaries permitted by law and
in such event shall notify the Lender promptly of such use of
proceeds.
7.14 Cooperate in Legal Proceedings. Except with
respect to any claim by the Borrower against the Lender, the
Borrower shall cooperate fully with the Lender with respect to
any proceedings before any Governmental Authority which may in
any way affect the rights of the Lender hereunder or any rights
obtained by the Lender under any of the Loan Documents and, in
connection therewith, not prohibit the Lender, at its election,
from participating in any such proceedings.
7.15 Further Assurances. The Borrower shall, at the
Borrower's sole cost and expense:
(i) execute and deliver or cause to be executed and
delivered to the Lender such documents, instruments,
certificates and other writings, and do such other acts
necessary, to evidence, preserve and/or protect the Lien on
the Pledge Account, as the Lender may reasonably require
(including, without limitation, executing and delivering UCC
filing statements); and
(ii) do and execute or cause to be done and executed
all and such further lawful and reasonable acts, conveyances
and assurances for the better and more effective carrying
out of the intents and purposes of this Agreement and the
other Loan Documents, as the Lender shall reasonably require
from time to time.
Section 8. Events of Default. If one or more of the
following events (herein called "Events of Default") shall occur
and be continuing:
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(a) The Borrower shall default in the payment when
due (whether at stated maturity or upon mandatory or
optional prepayment) of any principal of or interest on any
Advance, any fee or any other amount payable by it hereunder
or under any other Loan Document; or
(b) The Borrower shall default in the payment when
due of any principal of or interest on any of its other
Indebtedness (other than any nonrecourse Indebtedness)
aggregating $5,000,000 or more, or any other event specified
in any note, agreement, indenture or other document
evidencing or relating to any of the Borrower's other
Indebtedness (other than any nonrecourse Indebtedness)
aggregating $5,000,000 shall occur, and such payment default
or other event shall result in such Indebtedness becoming
due prior to its stated maturity; or
(c) Any representation, warranty or certification
made or deemed made herein or in any other Loan Document (or
in any modification or supplement hereto or thereto) by the
Borrower, or any certificate furnished to the Lender
pursuant to the provisions hereof or thereof, shall prove to
have been false or misleading in any material respect as of
the time made or furnished; or
(d) The Borrower shall default in the performance of
any of its obligations under any of Sections 7.01(f), 7.04,
7.05, 7.06, 7.09, 7.11 or 7.12 hereof or any of the material
terms or provisions of the Preferred Stock shall not be
observed; or
(e) The Borrower shall default in the performance of
any of its other obligations in this Agreement or any other
Loan Document and such default shall continue unremedied for
a period of thirty or more days after notice thereof to the
Borrower by the Lender; provided, however, that if such non-
monetary default is susceptible of cure but cannot
reasonably be cured within such 30-day period and the
Borrower shall have commenced to cure such default within
such 30-day period and thereafter diligently and
expeditiously proceeds to cure the same, such 30-day period
shall be extended for such time as is reasonably necessary
for Borrower in the exercise of due diligence to cure such
default, but in no event shall such period exceed 180 days
after the original notice from Lender; or
(f) The Borrower shall admit in writing its
inability to pay its debts as such debts become due; or
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(g) The Borrower shall (i) apply for or consent to
the appointment of, or the taking of possession by, a
receiver, custodian, trustee, examiner or liquidator of
itself or of all or a material part of its Property,
(ii) make a general assignment for the benefit of its
creditors, (iii) commence a voluntary case under the
Bankruptcy Code, (iv) file a petition seeking to take
advantage of any other law relating to bankruptcy,
insolvency, reorganization, liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of
debts, (v) fail to controvert in a timely manner, or
acquiesce in writing to, any petition filed against it in an
involuntary case under the Bankruptcy Code or (vi) take any
corporate action for the purpose of effecting any of the
foregoing; or
(h) A proceeding or case shall be commenced, without
the application or consent of the Borrower, in any court of
competent jurisdiction, seeking (i) its reorganization,
liquidation, dissolution, arrangement or winding-up, or the
composition or readjustment of its debts, (ii) the
appointment of a receiver, custodian, trustee, examiner,
liquidator or the like of the Borrower or of all or any
substantial part of its Property or (iii) similar relief in
respect of the Borrower under any law relating to
bankruptcy, insolvency, reorganization, winding-up, or
composition or adjustment of debts, and such proceeding or
case shall continue undismissed, or an order, judgment or
decree approving or ordering any of the foregoing shall be
entered and continue unstayed and in effect, for a period of
60 or more calendar days; or an order for relief against the
Borrower shall be entered in an involuntary case under the
Bankruptcy Code; or
(i) A final judgment or judgments for the payment of
money of $5,000,000 or more in the aggregate (exclusive of
judgment amounts covered by insurance) or of $10,000,000 or
more in the aggregate (regardless of insurance coverage)
shall be rendered by one or more courts, administrative
tribunals or other bodies having jurisdiction against any
Facility Owner and the same shall not be discharged (or
provision shall not be made for such discharge), or a stay
of execution thereof shall not be procured, within 30
calendar days from the date of entry thereof and any
Facility Owner shall not, within said period of 30 calendar
days, or such longer period during which execution of the
same shall have been stayed, appeal therefrom and cause the
execution thereof to be stayed during such appeal; or
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(j) an "Event of Default" (as defined in the FFC
Loan Agreement or any Approved Facility Loan Agreement)
shall occur and shall result in the Indebtedness under the
FFC Loan Agreement or any Approved Facility Loan Agreement
becoming due prior to its stated maturity; or
(k) An event specified in Section 7.01(e) hereof
shall occur or exist with respect to any Plan or
Multiemployer Plan and, as a result of such event or
condition, together with all other such events or
conditions, any Facility Owner shall be reasonably likely to
incur a liability to a Plan, a Multiemployer Plan or the
PBGC (or any combination of the foregoing) that (either
individually or in the aggregate) is reasonably likely to
have a Material Adverse Effect; or
(l) The Lien created pursuant to Section 3.04 hereof
shall at any time not constitute a valid and perfected Lien
on the collateral intended to be covered thereby (to the
extent perfection by filing, registration, recordation or
possession is required herein) in favor of the Lender, free
and clear of all other Liens, or the enforceability thereof
shall be contested by the Borrower;
THEREUPON: (1) in the case of an Event of Default other than one
referred to in clause (g) or (h) of this Section 8 with respect
to the Borrower, the Lender may, by notice to the Borrower,
terminate the Loan and/or declare the principal amount then
outstanding of, and the accrued interest on, the Advances and all
other amounts payable by the Borrower hereunder and under the
Note to be forthwith due and payable, whereupon such amounts
shall be immediately due and payable without presentment, demand,
protest or other formalities of any kind, all of which are hereby
expressly waived by the Borrower; and (2) in the case of the
occurrence of an Event of Default referred to in clause (g) or
(h) of this Section 8 with respect to the Borrower, the Loan
shall automatically be terminated and the principal amount then
outstanding of, and the accrued interest on, the Advances and all
other amounts payable by the Borrower hereunder and under the
Note shall automatically become immediately due and payable
without presentment, demand, protest or other formalities of any
kind, all of which are hereby expressly waived by the Borrower.
Section 9. Subordination.
9.01 Subordination to Senior Indebtedness.
Notwithstanding anything to the contrary contained in this
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Agreement, the Note or any other Loan Document (but subject to
Section 9.08), the rights of the Lender with respect to the
payment of amounts due under this Agreement, the Note or any
other Loan Document (collectively, the "Subordinated Amounts")
shall be junior and subordinate, to the extent and in the manner
provided in this Section 9, to the prior payment in full of
Senior Indebtedness. The Borrower shall give prompt written
notice to the Lender of any default or other event which would
prohibit the making of any payment on account of any Subordinated
Amount pursuant to the provisions of this Section 9.
9.02 Borrower Not To Make Payments in Certain
Circumstances.
(a) Upon the occurrence of any default in payment of
the principal of or premium, if any, or interest on any Senior
Indebtedness (whether at maturity, upon acceleration or
otherwise), then, subject to delivery of notice to the Lender by
the Borrower or the holder of such Senior Indebtedness, unless
and until such default shall have been cured or waived or shall
have ceased to exist, no direct or indirect payment in cash,
property or securities, by set-off or otherwise, shall be made or
agreed to be made by the Borrower or the Lender on account of any
Subordinated Amount.
(b) Upon the occurrence of an event of default
(other than in circumstances in which the terms of Section
9.02(a) hereof are applicable) with respect to any Senior
Indebtedness as a result of which the holders thereof are
entitled, under the terms of such Senior Indebtedness, to
accelerate the maturity thereof, upon written notice thereof
given to the Borrower by any holder or holders of such Senior
Indebtedness or their agents, representatives or trustees, then,
subject to delivery of notice to the Lender by the Borrower or
the holder of such Senior Indebtedness, unless and until such
event of default shall have been cured or waived or shall have
ceased to exist, no direct or indirect payment in cash, property
or securities, by set-off or otherwise, shall be made or agreed
to be made by the Borrower or the Lender on account of any
Subordinated Amount.
(c) In the event that, notwithstanding the
provisions of Section 9.02(a) or (b) hereof, any payment shall be
made on account of any Subordinated Amount in contravention of
Section 9.02(a) or (b) hereof, then, in any such case, except in
the case of any such default which shall have been cured or
waived or shall have ceased to exist, such payment shall (except
to the extent consisting of Permitted Junior Securities) be held
for the benefit of, and shall be paid over and delivered to, the
holders of such Senior Indebtedness (pro rata as to each of such
holders on the basis of the respective amounts of Senior
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Indebtedness held by them, as such respective amounts are set
forth in a written notice to the Lender from the Borrower) or
their representatives, agents or trustees, for application to the
payment of all Senior Indebtedness remaining unpaid to the extent
necessary to pay all Senior Indebtedness in full in accordance
with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
9.03 Subordination in the Event of Acceleration,
Dissolution, Liquidation or Reorganization. Upon (i) any amount
being declared due and payable or automatically becoming due and
payable pursuant to Section 8 hereof or (ii) any distribution of
assets of the Borrower in any dissolution, winding up,
liquidation (total or partial) or similar proceeding relating to
the Borrower (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors or
otherwise):
(a) the holders of Senior Indebtedness shall first
be entitled to receive payment in full of all Senior
Indebtedness (or to have such payment duly provided for in a
manner satisfactory to them) before the Lender is entitled
to receive any direct or indirect payment in cash, property
or securities, by set-off or otherwise, on account of any
Subordinated Amount;
(b) any payment or distribution of assets of the
Borrower of any kind or character, whether in cash, property
or securities (other than securities (herein called
"Permitted Junior Securities") of the Borrower as
reorganized or readjusted or of the Borrower or any other
company, trust or corporation provided for by a plan of
reorganization or readjustment, the payment of which is
subordinate, at least to the extent provided in this Section
9 with respect to the Subordinated Amounts to the payment of
all Senior Indebtedness at the time outstanding and to the
payment of all securities issued in exchange therefor to the
holders of the Senior Indebtedness at the time outstanding),
to which the Lender would be entitled but for the provisions
of this Section 9 shall be paid by the liquidating trustee
or agent or other person making such payment or distribution
directly to the holders of the Senior Indebtedness or their
agents, representatives or trustees (pro rata as to each
such holder, agent, representative or trustee on the basis
of the respective amounts of unpaid Senior Indebtedness held
or represented by each), to the extent necessary to make
payment in full of all Senior Indebtedness remaining unpaid,
after giving effect to any concurrent payment or
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distribution or provision therefor to the holders of such
Senior Indebtedness; and
(c) in the event that, notwithstanding the foregoing
provisions of this Section 9.03, any payment or distribution
of assets of the Borrower of any kind or character, whether
in cash, property or securities (other than Permitted Junior
Securities) shall be received by the Lender on account of
any Subordinated Amount before all Senior Indebtedness is
paid in full in accordance with its terms, or effective
provision made for its payment, such payment or distribution
shall be received and held for the benefit of and paid over
to the holders of the Senior Indebtedness remaining unpaid
or unprovided for or their agents, representatives or
trustees (pro rata as provided in Section 9.03(b) hereof)
for application to the payment of such Senior Indebtedness
until all such Senior Indebtedness shall have been paid in
full, after giving effect to any concurrent payment or
distribution or provision therefor to the holders of such
Senior Indebtedness.
9.04 Lender to Be Subrogated to Rights of Holders of
Senior Indebtedness. Subject to the payment in full of all
Senior Indebtedness, the Lender shall be subrogated to the rights
of the holders of Senior Indebtedness to receive payments or
distributions of assets of the Borrower applicable to the Senior
Indebtedness until all Subordinated Amounts shall be paid in
full, and for the purpose of such subrogation no payments or
distributions to the holders of Senior Indebtedness by or on
behalf of the Borrower or by or on behalf of the Lender by virtue
of this Section 9 which otherwise would have been made to the
Lender shall, as between the Borrower and the Lender, be deemed
to be payment by the Borrower to or on account of Senior
Indebtedness, it being understood that the provisions of this
Section 9 are intended solely for the purpose of defining the
relative rights of the Lender, on the one hand, and the holders
of Senior Indebtedness, on the other hand.
9.05 Obligations of the Borrower Unconditional.
Nothing contained in this Section 9 is intended to or shall
impair, as between the Borrower and the Lender, the obligation of
the Borrower, which is absolute and unconditional, to pay to the
Lender all Subordinated Amounts as and when the same shall become
due and payable, or is intended or shall affect the relative
rights of the Lender and creditors of the Borrower other than the
holders of Senior Indebtedness, nor, except as expressly provided
in this Section 9, shall anything herein prevent the Lender from
exercising all remedies otherwise permitted by applicable law
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upon default under this Agreement, the Note or any other Loan
Document, subject to the rights, if any, under this Section 9 of
the holders of Senior Indebtedness, in respect of cash, property
or securities of the Borrower received upon the exercise of any
such remedy. Upon any distribution of assets of the Borrower
referred to in this Section 9, the Lender shall be entitled to
rely upon any order or decree by any court of competent
jurisdiction in which such dissolution, winding up, liquidation
or reorganization proceedings are pending or a certificate of the
liquidating trustee or agent or other person making any
distribution to the Lender for the purpose of ascertaining the
persons entitled to participate in such distribution, the holders
of Senior Indebtedness and other indebtedness of the Borrower,
the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or
to this Section 9. Nothing contained in this Section 9 or
elsewhere in this Agreement is intended to or shall affect the
obligation of the Borrower to make, or prevent the Borrower from
making, at any time except as specifically provided in Sections
9.02 and 9.03 hereof, payments at any time in respect of the
Subordinated Amounts.
9.06 Subordination Rights Not Impaired by Acts or
Omissions of Borrower or Holders of Senior Indebtedness. No
right of any present or future holders of any Senior Indebtedness
to enforce subordination as provided herein shall at any time in
any way be prejudiced or impaired by any act or failure to act on
the part of the Borrower or by any act or failure to act by any
such holder, or by any noncompliance by the Borrower with the
terms of this Agreement, the Note or any other Loan Document,
regardless of any knowledge thereof which any such holder may
have or be otherwise charged with.
9.07 Further Assurances with Respect to
Subordination. At any time or from time to time upon the request
of any holder of Senior Indebtedness or its representative, agent
or trustee, the Lender shall execute and deliver such further
documents and do such other acts and things as any such holder,
representative, agent or trustee may reasonably request to effect
fully the subordination of the Subordinated Amounts to such
Senior Indebtedness to the extent and in the manner provided in
this Section 9.
9.08 Limitation on Subordination. Nothing in this
Section 9 shall affect, impair or subordinate the Lender's rights
in the Account Collateral, or its rights to receive and retain
the Account Collateral and to apply the same to the payment of
the Subordinated Amounts, it being expressly understood and
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agreed that the Lender is entitled to an unsubordinated first
priority security interest in the Account Collateral pursuant to
Section 3.04 hereof. None of the provisions hereof shall limit
in any way the Lender's ability to enforce its rights in the
Account Collateral and the Preferred Stock.
9.09 Certain Definitions. For purposes of this
Section 9, the term "Lender" means the initial Lender and any
successor or assign thereof.
Section 10. Miscellaneous.
10.01 Waiver. No failure on the part of the Lender
to exercise and no delay in exercising, and no course of dealing
with respect to, any right, power or privilege under this
Agreement or the Note shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or
privilege under this Agreement or the Note preclude any other or
further exercise thereof or the exercise of any other right,
power or privilege. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law.
The Borrower irrevocably waives, to the fullest
extent permitted by applicable law, any claim that any action or
proceeding commenced by the Lender relating in any way to this
Agreement should be dismissed or stayed by reason, or pending the
resolution, of any action or proceeding commenced by the Borrower
relating in any way to this Agreement whether or not commenced
earlier. To the fullest extent permitted by applicable law, the
Borrower shall take all measures necessary for any such action or
proceeding commenced by the Lender to proceed to judgment prior
to the entry of judgment in any such action or proceeding
commenced by the Borrower.
10.02 Notices. All notices, requests and other
communications provided for herein and under the Security
Documents (including, without limitation, any modifications of,
or waivers, requests or consents under, this Agreement) shall be
given or made in writing (including, without limitation, by
telecopy) delivered to the intended recipient at the "Address for
Notices" specified below its name on the signature pages hereof);
or, as to any party, at such other address as shall be designated
by such party in a notice to each other party. Except as
otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed
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notice, upon receipt, in each case given or addressed as
aforesaid.
10.03 Expenses, Etc. The Borrower agrees to pay or
reimburse (or make provision therefor) the Lender for: (a) all
reasonable out-of-pocket costs and expenses of the Lender
(including, without limitation, the reasonable fees and expenses
of Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, special New York counsel to
the Lender) in connection with (i) the negotiation, preparation,
execution and delivery of this Agreement and the other Loan
Documents and the making of the Advances hereunder and (ii) the
negotiation or preparation of any modification, supplement or
waiver of any of the terms of this Agreement or any of the other
Loan Documents (whether or not consummated) or any document
prepared pursuant to Section 9.07; (b) all reasonable
out-of-pocket costs and expenses of the Lender (including,
without limitation, the reasonable fees and expenses of legal
counsel) in connection with (i) any Default and any enforcement
or collection proceedings resulting therefrom, (including,
without limitation, all manner of participation in or other
involvement with (x) bankruptcy, insolvency, receivership,
foreclosure, winding up or liquidation proceedings, (y) judicial
or regulatory proceedings and (z) workout, restructuring or other
negotiations or proceedings (whether or not the workout,
restructuring or transaction contemplated thereby is consummated)
and (ii) the enforcement of this Section 10.03; and (c) all
transfer, stamp, documentary or other similar taxes, assessments
or charges levied by any governmental or revenue authority in
respect of this Agreement or any of the other Loan Documents or
any other document referred to herein or therein and all costs,
expenses, taxes, assessments and other charges incurred in
connection with any filing, registration, recording or perfection
of any security interest contemplated by any Security Document or
any other document referred to therein.
The Borrower hereby agrees to indemnify the Lender
and its directors, officers, employees, attorneys and agents
from, and hold each of them harmless against, any and all losses,
liabilities, claims, damages or expenses incurred by any of them
arising out of or by reason of any investigation or litigation or
other proceedings (including any threatened investigation or
litigation or other proceedings) relating to the Advances
hereunder or any actual or proposed use by the Borrower of the
proceeds of any of the Advances hereunder (including, without
limitation, the reasonable fees and disbursements of counsel
incurred in connection with any such investigation or litigation
or other proceedings) (but excluding any such losses,
liabilities, claims, damages or expenses incurred by reason of
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the gross negligence or willful misconduct of the Person to be
indemnified). Without limiting the generality of the foregoing,
the Borrower will indemnify the Lender from, and hold the Lender
harmless against, any losses, liabilities, claims, damages or
expenses described in the preceding sentence (but excluding, as
provided in the preceding sentence, any loss, liability, claim,
damage or expense incurred by reason of the gross negligence or
willful misconduct of the Person to be indemnified) arising under
any Environmental Law as a result of the past, present or future
operations of the Borrower or any of its Subsidiaries (or any
predecessor in interest to the Borrower or any of its
Subsidiaries), or the past, present or future condition of any
site or facility owned, operated or leased at any time by the
Borrower or any of its Subsidiaries (or any such predecessor in
interest), or any Release or threatened Release of any Hazardous
Materials at or from any such site or facility, excluding any
such Release or threatened Release that shall occur during any
period when the Lender shall be in possession of any such site or
facility following the exercise by the Lender of any of its
rights and remedies hereunder or under any of the Security
Documents, but including any such Release or threatened Release
occurring during such period that is a continuation of conditions
previously in existence, or of practices employed by the Borrower
and its Subsidiaries, at such site or facility.
10.04 Amendments, Etc. No provision of this
Agreement may be modified or supplemented except by an instrument
in writing signed by the Borrower and the Lender.
10.05 Successors and Assigns. This Agreement shall
be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns.
10.06 Assignments and Participations.
(a) The Borrower may not assign any of its rights or
obligations hereunder or under the Note without the prior consent
of the Lender.
(b) The Lender may assign the Loan and the Note;
provided, however, the Lender may not, without the prior written
consent of the Borrower, assign (x) its obligation hereunder to
make Advances to the Borrower or (y) the Loan or the Note to a
Prohibited Transferee. Upon execution and delivery by the
assignee to the Borrower of an instrument in writing pursuant to
which the assignee agrees to become the "Lender" hereunder, and
upon consent thereto by the Borrower to the extent required
above, the assignee shall have (unless otherwise provided in such
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assignment with the consent of the Borrower) the obligations,
rights and benefits of the Lender hereunder in respect of the
Loan and Advances theretofore held by the Lender, and the
assigning Lender shall be released from the Loan; provided, that
the Borrower shall in no event be required to recognize multiple
lenders under this Agreement.
(c) The Lender may sell or agree to sell to one or
more other Persons (each a "Participant") a participation in all
or any part of any Advances, or in the Loan; provided, that such
Participant shall not have any rights or obligations under this
Agreement or the Note or any other Loan Document (the
Participant's rights against the Lender in respect of such
participation to be those set forth in the agreements executed by
the Lender in favor of the Participant); and provided, further,
that no Prohibited Transferee may be a Participant. In no event
shall the Lender agree with the Participant to take or refrain
from taking any action hereunder or under any other Loan Document
except that the Lender may agree with the Participant that it
will not, without the consent of the Participant, agree to
(i) increase or extend the term of the Loan, (ii) extend the date
fixed for the payment of principal of or interest on the related
Advance or Advances or any portion of any fee hereunder payable
to the Participant, (iii) reduce the amount of any such payment
of principal or (iv) reduce the rate at which interest is payable
thereon, or any fee hereunder payable to the Participant, to a
level below the rate at which the Participant is entitled to
receive such interest or fee.
(d) The Lender may furnish any information
concerning the Borrower or any of its Subsidiaries in the
possession of the Lender from time to time to assignees and
participants (including prospective assignees and participants).
10.07 Survival. The obligations of the Borrower
under Section 10.03 hereof shall survive the repayment of the
Advances and the termination of this Agreement. In addition,
each representation and warranty made, or deemed to be made by a
notice of any Advance, herein or pursuant hereto shall survive
the making of such representation and warranty, and the Lender
shall not be deemed to have waived, by reason of making any
Advance, any Default that may arise by reason of such
representation or warranty proving to have been false or
misleading, notwithstanding that the Lender may have had notice
or knowledge or reason to believe that such representation or
warranty was false or misleading at the time such Advance was
made.
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10.08 Captions. The table of contents and captions
and section headings appearing herein are included solely for
convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.
10.09 Counterparts. This Agreement may be executed
in any number of counterparts, all of which taken together shall
constitute one and the same instrument and any of the parties
hereto may execute this Agreement by signing any such
counterpart.
10.10 Governing Law; Submission to Jurisdiction.
This Agreement and the Note shall be governed by, and construed
in accordance with, the law of the State of New York, without
giving effect to the conflict of law principles thereof. The
Borrower hereby submits to the nonexclusive jurisdiction of the
United States District Court for the Southern District of New
York and of the Supreme Court of the State of New York sitting in
New York County (including its Appellate Division), and of any
other appellate court in the State of New York, for the purposes
of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Borrower
hereby irrevocably waives, to the fullest extent permitted by
applicable law, any objection that it may now or hereafter have
to the laying of the venue of any such proceeding brought in such
a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.
10.11 Waiver of Jury Trial. EACH OF THE BORROWER
AND THE LENDER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE NOTE OR THE TRANSACTIONS CONTEMPLATED HEREBY.
10.12 Treatment of Certain Information. The
Borrower acknowledges that from time to time financial advisory,
investment banking and other services may be offered or provided
to the Borrower or one or more of its Subsidiaries (in connection
with this Agreement or otherwise) by the Lender or by one or more
subsidiaries or affiliates of the Lender and the Borrower hereby
authorizes the Lender to share any information delivered to the
Lender by the Borrower and its Subsidiaries pursuant to this
Agreement, or in connection with the decision of the Lender to
enter into this Agreement, to any such subsidiary or affiliate,
but only in connection with the delivery of such services
directly to the Borrower or its Subsidiaries. Such authorization
shall survive the repayment of the Advances and the termination
of the Loan.
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10.13 Brokers and Financial Advisors. The Borrower
and the Lender hereby represent that they have dealt with no
financial advisors, brokers, underwriters, placement agents,
agents or finders in connection with the transactions
contemplated by this Agreement except for Nomura Securities
International, Inc. (the "Finder"). Borrower agrees to pay all
amounts required to be paid to the Finder pursuant to that
certain letter agreement dated August 23, 1995, between Borrower
and the Finder. Borrower and Lender hereby agree to indemnify
and hold the other harmless from and against any and all claims,
liabilities, costs and expenses of any kind in any way relating
to or arising from a claim by any Person (other than the Finder)
that such Person acted on behalf of the indemnifying party in
connection with the transactions contemplated herein. The
provisions of this Section 10.13 shall survive the expiration and
termination of this Agreement and the repayment of the Loan.
10.14 Lender's Discretion. Whenever pursuant to
this Agreement, the Lender exercises any right given to it to
approve or disapprove, or any arrangement or term is to be
satisfactory to the Lender, the decision of the Lender to approve
or disapprove or to decide whether arrangements or terms are
satisfactory or not satisfactory shall (except as is otherwise
specifically herein provided) be in the sole discretion of the
Lender and shall be final and conclusive.
10.15 Severability. Wherever possible, each
provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any
provision of this Agreement shall be prohibited by or invalid
under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating
the remainder of such provision or the remaining provisions of
this Agreement.
10.16 Preferences. To the extent the Borrower makes
a payment or payments to the Lender for the Borrower's benefit,
which payment or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other
party under any bankruptcy law, state or federal law, common law
or equitable cause, then, to the extent of such payment or
proceeds received, the obligations hereunder or part thereof
intended to be satisfied shall be revived and continue in full
force and effect, as if such payment or proceeds had not been
received by the Lender.
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10.17 Waiver of Notice. The Borrower shall not be
entitled to any notices of any nature whatsoever from the Lender
except with respect to matters for which this Agreement or the
other Loan Documents specifically and expressly provide for the
giving of notice by the Lender to the Borrower and except with
respect to matters for which the Borrower is not, pursuant to
applicable Legal Requirements, permitted to waive the giving of
notice. Borrower hereby expressly waives the right to receive
any notice from Lender with respect to any matter for which this
Agreement or the other Loan Documents does not specifically and
expressly provide for the giving of notice by Lender to Borrower.
10.18 Remedies of Borrower. In the event that a
claim or adjudication is made that Lender or its agents has acted
unreasonably or unreasonably delayed acting in any case where by
law or under this Agreement or the other Loan Documents the
Lender or such agent, as the case may be, has an obligation to
act reasonably or promptly, the Borrower agrees that neither the
Lender nor its agents, Servicer, shall be liable for any monetary
damages, and the Borrower's sole remedies shall be limited to
commencing an action seeking injunctive relief or declaratory
judgment. The parties hereto agree that any action or proceeding
to determine whether the Lender has acted reasonably shall be
determined by an action seeking declaratory judgment.
10.19 Waiver of Marshalling of Assets Defense. To
the fullest extent the Borrower may legally do so, the Borrower
waives all rights to a marshalling of the assets of the Borrower
and Persons with interests in Borrower, or to a sale in inverse
order of alienation in the event of foreclosure of the interests
hereby created, and agrees not to assert any right under any laws
pertaining to the marshalling of assets, the sale in inverse
order of alienation, homestead exemption, the administration of
estates of decedents, or any other matters whatsoever to defeat,
reduce or affect the right of the Lender under the Loan Documents
to a sale of the assets of the Borrower for the collection of the
Loan without any prior or different resort for collection, or the
right of Lender to the payment of the Loan out of the Proceeds in
preference to every other claimant whatsoever.
10.20 Waiver of Counterclaim. The Borrower hereby
waives the right to assert a counterclaim, other than compulsory
counterclaim, in any action or proceeding brought against it by
the Lender or its agents.
10.21 FINAL AGREEMENT. THIS AGREEMENT, TOGETHER
WITH ALL OTHER WRITTEN AGREEMENTS BETWEEN BORROWER AND LENDER, IS
THE FINAL EXPRESSION OF THE CREDIT AGREEMENT BETWEEN THE BORROWER
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AND THE LENDER, AND SUCH WRITTEN CREDIT AGREEMENT MAY NOT BE
CONTRADICTED BY EVIDENCE OF ANY PRIOR ORAL CREDIT AGREEMENT OR OF
A CONTEMPORANEOUS ORAL CREDIT AGREEMENT BETWEEN THE BORROWER AND
THE LENDER.
10.22 Tax Treatment. It is the intention of the
parties that the Advances constitute indebtedness of the Borrower
for purposes of applicable federal, state and local tax laws and
that the sole relationship resulting from the execution and
delivery of this Agreement and the consummation of the
transactions contemplated hereby be, for purposes of all such
laws, solely that of debtor and creditor.
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IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed and delivered as of the day
and year first above written.
BORROWER:
FORUM GROUP, INC.
By /s/ ▇▇▇▇ ▇. Read
_________________________
Title: Vice President
Address for Notices:
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
LENDER:
NOMURA ASSET CAPITAL CORPORATION
By /s/ ▇▇▇ ▇▇▇▇▇▇▇
_________________________
Title: Vice President
Address for Notices:
2 World Financial ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Telecopier No.: 212-667-1014
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇