1
EXHIBIT f.2.e
AMENDED AND RESTATED
CREDIT AGREEMENT
among
ALLIED CAPITAL CORPORATION,
Borrower
BANK OF AMERICA, N.A.,
Administrative Agent
BANC OF AMERICA SECURITIES LLC,
Sole Lead Arranger and Sole Book Manager
FIRST UNION NATIONAL BANK,
Syndication Agent
FLEET NATIONAL BANK,
Documentation Agent
▇▇▇▇▇ BANK N.A.,
Managing Agent
CREDIT LYONNAIS NEW YORK BRANCH,
BRANCH BANKING & TRUST CO.,
CHEVY CHASE BANK, F.S.B.,
and
DEUTSCHE BANK AG, NEW YORK BRANCH
Co-Agents
and
THE LENDERS NAMED HEREIN,
Lenders
UP TO $500,000,000
DATED AS OF MAY 17, 2000
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TABLE OF CONTENTS
PAGE
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SECTION 1 DEFINITIONS AND TERMS ................................. 1
1.1 Definitions .................................... 1
1.2 General; References to Times ................... 17
1.3 Accounting Principles .......................... 17
SECTION 2 CREDIT FACILITY ....................................... 17
2.1 Loans .......................................... 17
2.2 Swing Line Subfacility ......................... 18
2.3 LC Subfacility ................................. 19
2.4 Borrowing Procedures ........................... 22
2.5 Rates and Payment of Interest on Loans ......... 22
2.6 Number of Interest Periods ..................... 23
2.7 Repayment of Loans ............................. 23
2.8 Prepayments .................................... 24
2.9 Continuation ................................... 24
2.10 Conversion ..................................... 25
2.11 Notes .......................................... 25
2.12 Reductions of the Commitment ................... 25
2.13 Increases of Commitments ....................... 26
2.14 Optional Renewal of Commitments ................ 26
SECTION 3 PAYMENTS, FEES AND OTHER GENERAL PROVISIONS ........... 28
3.1 Payments ....................................... 28
3.2 Pro Rata Treatment ............................. 29
3.3 Sharing of Payments, Etc ....................... 29
3.4 Offset ......................................... 30
3.5 Booking Borrowings ............................. 30
3.6 Several Obligations ............................ 30
3.7 Minimum Amounts ................................ 30
3.8 Fees ........................................... 30
3.9 Computations ................................... 31
3.10 Maximum Rate ................................... 31
3.11 Interest Recapture ............................. 31
3.12 Agreement Regarding Interest and Charges ....... 32
3.13 Defaulting Lenders ............................. 32
SECTION 4 YIELD PROTECTION, ETC ................................. 33
4.1 Increased Cost and Reduced Return ............... 33
4.2 Limitation on Types of Loans .................... 35
4.3 Illegality ...................................... 35
4.4 Treatment of Affected Loans ..................... 35
4.5 Compensation .................................... 36
4.6 Taxes ........................................... 36
4.7 Removal of Lenders .............................. 37
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
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SECTION 5 CONDITIONS PRECEDENT ................................. 38
5.1 Initial Conditions Precedent .................... 38
5.2 Conditions Precedent to All Loans ............... 40
SECTION 6 REPRESENTATIONS AND WARRANTIES ....................... 40
6.1 Representations and Warranties .................. 40
6.2 Survival of Representations and Warranties, Etc.. 45
SECTION 7 AFFIRMATIVE COVENANTS ................................ 45
7.1 Preservation of Existence and Similar Matters ... 45
7.2 Compliance with Applicable Law and Material
Contracts ....................................... 46
7.3 Maintenance of Property ......................... 46
7.4 Conduct of Business ............................. 46
7.5 Insurance ....................................... 46
7.6 Payment of Taxes and Claims ..................... 46
7.7 Visits and Inspections .......................... 46
7.8 Use of Proceeds ................................. 46
7.9 Environmental Matters ........................... 47
7.10 Books and Records ............................... 47
7.11 Status of RIC and BDC ........................... 47
7.12 ERISA Exemptions ................................ 47
7.13 Further Assurances .............................. 47
SECTION 8 INFORMATION .......................................... 47
8.1 Quarterly Financial Statements .................. 47
8.2 Year-End Statements ............................. 48
8.3 Compliance Certificate; Asset Reports ........... 48
8.4 Other Information ............................... 49
SECTION 9 NEGATIVE COVENANTS ................................... 51
9.1 Financial Covenants ............................. 51
9.2 Interest Rate Agreements ........................ 51
9.3 Liens; Agreements Regarding Liens;
Other Matters ................................... 51
9.4 Distributions to Shareholders ................... 52
9.5 Merger, Consolidation and Sales of Assets ....... 53
9.6 Fiscal Year ..................................... 54
9.7 Modifications to Material Contracts ............. 54
9.8 Transactions with Affiliates .................... 54
9.9 Subsidiary Senior Note Guaranty ................. 54
9.10 Payment of Obligation ........................... 54
SECTION 10 DEFAULT .............................................. 55
10.1 Events of Default ............................... 55
10.2 Remedies Upon Event of Default .................. 58
10.3 Remedies Upon Certain Defaults .................. 59
10.4 Allocation of Proceeds .......................... 59
10.5 Performance by Administrative Agent ............. 60
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
(ii)
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10.6 Rights Cumulative ............................. 60
10.7 Company Waivers ............................... 60
10.8 Delegation of Duties and Rights ............... 60
10.9 Not in Control ................................ 60
10.10 Course of Dealing ............................. 61
10.11 Cumulative Rights ............................. 61
SECTION 11 AGREEMENT AMONG LENDERS .............................. 61
11.1 Appointment, Powers, and Immunities ........... 61
11.2 Reliance by Administrative Agent .............. 62
11.3 Defaults ...................................... 62
11.4 Rights as Lender .............................. 62
11.5 Indemnification ............................... 63
11.6 Non-Reliance on Administrative Agent and
Other Lenders ................................. 63
11.7 Resignation of Administrative Agent ........... 63
11.8 Relationship of Lenders ....................... 64
11.9 Benefits of Agreement ......................... 64
11.10 Obligations Several ........................... 64
11.11 Agents ........................................ 64
SECTION 12 MISCELLANEOUS ........................................ 64
12.1 Notices ....................................... 64
12.2 Expenses ...................................... 65
12.3 Jurisdiction; Consent to Service of Process;
Waiver of Jury Trial .......................... 65
12.4 Successors and Assigns ........................ 66
12.5 Amendments .................................... 68
12.6 Nonliability of Agent and Lenders ............. 68
12.7 Confidentiality ............................... 69
12.8 INDEMNIFICATION ............................... 69
12.9 Termination; Survival ......................... 70
12.10 Severability of Provisions .................... 70
12.11 Governing Law ................................. 70
12.12 Counterparts .................................. 70
12.13 Entirety ...................................... 70
12.14 Construction .................................. 70
12.15 Discharge Only Upon Payment in Full;
Reinstatement in Certain Circumstances ........ 70
12.16 Restatement of Existing Agreement ............. 71
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
(iii)
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SCHEDULES AND EXHIBITS
Schedule 2 - Lenders and Commitments
Schedule 6.1(a) - Qualification
Schedule 6.1(b) - Ownership Structure
Schedule 6.1(g) - Indebtedness
Schedule 6.1(h) - Material Contracts
Exhibit A - Form of Assignment and Acceptance Agreement
Exhibit B-1 - Form of Notice of Borrowing
Exhibit B-2 - Form of LC Request
Exhibit C - Form of Notice of Continuation
Exhibit D - Form of Notice of Conversion
Exhibit E-1 - Form of Amended and Restated Revolving Note
Exhibit E-2 - Form of Amended and Restated Swing Line Note
Exhibit F - Form of Opinion of Counsel
Exhibit G - Form of Compliance Certificate
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
(iv)
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AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of May 17,
2000, by and among ALLIED CAPITAL CORPORATION, a corporation organized under the
laws of the State of Maryland ("BORROWER"), certain Lenders (hereinafter
defined), certain Agents (hereinafter defined), and BANK OF AMERICA, N.A., as a
Lender and as Administrative Agent (hereinafter defined) for itself and the
other Lenders (hereinafter defined).
RECITALS
A. Borrower has entered into the Credit Agreement dated as of March 9,
1999, as amended by that certain First Amendment to Credit Agreement dated as of
May 7, 1999, that certain Second Amendment to Credit Agreement dated as of
January 18, 2000, and that certain Third Amendment to Credit Agreement dated as
of March 17, 2000 (the "EXISTING AGREEMENT") with Bank of America, N.A. (in its
capacity as "ADMINISTRATIVE AGENT" thereunder and as Lender) and certain other
Lenders party thereto (together with Bank of America, N.A., the "EXISTING
LENDERS"), providing for, among other things, a revolving credit facility in the
aggregate principal amount of $400,000,000.
B. Subject to the terms and conditions set forth below, Borrower and
Lenders desire to entirely amend, modify, and restate the Existing Agreement.
C. The amendment and restatement of the Existing Agreement hereunder is
not intended by the parties to constitute either a novation or a discharge or
satisfaction of the indebtedness and obligations under the Existing Agreement,
which indebtedness and obligations under the Existing Agreement shall remain
outstanding hereunder on the terms and conditions hereinafter provided.
In consideration of the foregoing and the mutual covenants contained
herein, Borrower, Bank of America, N.A. (in its capacity as Administrative Agent
under this Agreement and the Existing Agreement), and Lenders agree that,
effective upon the Effective Date, the Existing Agreement is amended and
restated in its entirety as follows:
SECTION 1 DEFINITIONS AND TERMS.
1.1 DEFINITIONS. As used herein:
"ADJUSTED EBIT" means, for any period with respect to Borrower and its
Consolidated Subsidiaries, income after deduction of all expenses and other
proper charges other than taxes and Interest Expense, all as determined in
accordance with GAAP.
"ADJUSTED EURODOLLAR RATE" means, for any Eurodollar Loan for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) determined by Administrative Agent to be equal to the
quotient obtained by dividing (a) the Eurodollar Rate for such Eurodollar Loan
for such Interest Period by (b) one minus the Reserve Requirement for such
Eurodollar Loan for such Interest Period.
"ADMINISTRATIVE AGENT" means Bank of America, N.A., and its permitted
successor or successors as administrative agent for the Lenders under this
Agreement.
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
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"AFFECTED LENDER" has the meaning given that term in SECTION 4.7.
"AFFILIATE" means any Person: (a) directly or indirectly controlling,
controlled by, or under common control with such Person; (b) directly or
indirectly owning or holding 5.0% or more of any equity interest in such Person;
or (c) 5.0% or more of whose voting stock or other equity interest is directly
or indirectly owned or held by such Person. For purposes of this definition, (x)
"control" (including with correlative meanings, the terms "controlling,"
"controlled by," and "under common control with") means the possession directly
or indirectly of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities or
by contract or otherwise, other than by investment advisory contracts entered
into in the ordinary course of business of Borrower or a Subsidiary of Borrower,
and (y) neither Administrative Agent nor any Lender shall be deemed to be
an "Affiliate" of Borrower.
"AGENTS" means, collectively, Syndication Agent, Documentation Agent,
Managing Agent, and Co-Agents.
"AGREEMENT" means this Amended and Restated Credit Agreement (as the
same may thereafter be amended, modified, supplemented, or restated from time to
time).
"AGREEMENT DATE" means the date as of which this Agreement is dated.
"APPLICABLE LAW" means all applicable provisions of constitutions,
statutes, rules, regulations, and orders of all governmental bodies and all
orders and decrees of all courts, tribunals, and arbitrators.
"ARRANGER" means Banc of America Securities LLC and its successors and
assignees in its capacity as "Lead Arranger."
"ASSET COVERAGE RATIO" shall mean, on a consolidated basis for Borrower
and its Consolidated Subsidiaries, the ratio which the value of total assets,
less all liabilities and indebtedness not represented by senior securities (all
as determined pursuant to the Investment Company Act and any orders of the
Securities and Exchange Commission issued to Borrower thereunder), bears to the
aggregate amount of senior securities representing indebtedness of Borrower and
its Consolidated Subsidiaries.
"ASSIGNMENT AND ACCEPTANCE AGREEMENT" means an Assignment and Acceptance
Agreement among a Lender, an Eligible Assignee, and Administrative Agent,
substantially in the form of EXHIBIT A or such other form as may be agreed to by
such Lender, such Eligible Assignee and Administrative Agent.
"BANK OF AMERICA" means Bank of America, N.A. and its permitted
successors and assigns.
"BASE RATE" means the per annum rate of interest equal to the greater of
(a) the Prime Rate or (b) the Federal Funds Rate for such day plus 0.5%. Any
change in the Base Rate resulting for such day from a change in the Prime Rate
or the Federal Funds Rate shall be effective on the effective date of such
change in the Prime Rate or Federal Funds Rate.
"BASE RATE LOAN" means a Loan bearing interest at a rate based on the
Base Rate.
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
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"BENEFIT ARRANGEMENT" means at any time an employee benefit plan within
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan
and which is maintained or otherwise contributed to by any member of the ERISA
Group.
"BOOK VALUE" means, at any date of determination with respect to any
asset, the value thereof as the same would be reflected on a consolidated
balance sheet of Borrower and its Consolidated Subsidiaries as at such time in
accordance with GAAP.
"BORROWER" is defined in the preamble to this Agreement and includes any
permitted successors of Borrower.
"BUSINESS DAY" means (a) any day other than a Saturday, Sunday, or other
day on which banks in New York City, New York are authorized or required to
close and (b) in addition to the foregoing, with reference to a Eurodollar Loan,
any such day that is also a day on which dealings in Dollar deposits are carried
out in the London interbank market and commercial banks are open for
international business in London.
"CAPITALIZED LEASE OBLIGATION" means Indebtedness represented by
obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP, and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with such principles.
"CO-AGENTS" means, collectively, Credit Lyonnais New York Branch, Branch
Banking & Trust Co., Chevy Chase Bank, F.S.B., and Deutsche Bank AG, New York
Branch and their respective permitted successors or assigns as "Co-Agents" under
this Agreement.
"COMMERCIAL MORTGAGE LOAN" means a loan secured by a Lien on improved
real estate used for commercial purposes.
"COMMITMENT" means, as to each Lender, such Lender's obligation to make
Loans pursuant to SECTION 2.1(or purchase participations in Swing Line Loans
pursuant to SECTION 2.2(b) or in LCs pursuant to SECTION 2.3(b)) in an amount up
to, but not exceeding, the amount set forth for such Lender on SCHEDULE 2 as
such Lender's "Commitment Amount" or as set forth in the applicable Assignment
and Acceptance Agreement, as the same may be reduced or increased from time to
time pursuant to SECTIONS 2.12 and 2.13 or as appropriate to reflect any
assignments to or by such Lender effected in accordance with SECTION 12.4.
"COMMITMENT PERCENTAGE" means, as to each Lender, the ratio, expressed
as a percentage, of (a) the amount of such Lender's Commitment to (b) the sum of
the aggregate amount of the Commitments of all Lenders hereunder; provided,
however, that if at the time of determination, the Commitments have terminated
or been reduced to zero, the "COMMITMENT PERCENTAGE" of each Lender shall be the
Commitment Percentage of such Lender in effect immediately prior to such
termination or reduction.
"COMMITMENT USAGE" means, at the time of any determination thereof, the
sum of (a) the Principal Debt plus, without duplication, (b) the LC Exposure.
"COMPLIANCE CERTIFICATE" means a certificate signed by the chief
financial officer of Borrower, substantially in the form of EXHIBIT G.
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
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"CONSOLIDATED DEBT" shall mean as of the date of any determination
thereof, the aggregate unpaid amount of all Debt of Borrower and its
Consolidated Subsidiaries determined on a consolidated basis in accordance with
GAAP.
"CONSOLIDATED SHAREHOLDERS' EQUITY," as of the date of determination
thereof, shall mean the total shareholders' equity of Borrower and its
Consolidated Subsidiaries as the same would appear on a consolidated balance
sheet of Borrower and its Consolidated Subsidiaries prepared as of such date in
accordance with GAAP, including, in any case, common stock of Borrower (valued
at cost) held in the Allied Capital Corporation Deferred Compensation Trust and
Permitted Preferred Stock of Borrower and its Consolidated Subsidiaries, but
excluding any stock, common or preferred, not both issued and outstanding.
"CONSOLIDATED SUBSIDIARIES" shall mean any Subsidiary which is required
to be consolidated on financial statements of Borrower prepared in accordance
with GAAP.
"CONTINGENT OBLIGATION" as applied to any Person, means any direct or
indirect liability, contingent or otherwise, of that Person: (a) with respect to
any indebtedness, lease, dividend, or other obligation of another Person if the
primary purpose or intent of the Person incurring such liability, or the primary
effect thereof, is to provide assurance to the obligee of such liability that
such liability will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such liability will be
protected (in whole or in part) against loss with respect thereto; (b) with
respect to any letter of credit issued for the account of that Person or as to
which that Person is otherwise liable for reimbursement of drawings; (c) under
Interest Rate Agreements; or (d) under any foreign exchange contract, currency
swap agreement, or other similar agreement or arrangement designed to protect
that Person against fluctuations in currency values. "Contingent Obligations"
shall include (i) the direct or indirect guaranty, endorsement (other than for
collection or deposit in the ordinary course of business), comaking, discounting
with recourse, or sale with recourse by such Person of the obligation of
another, (ii) the obligation to make take or pay or similar payments if required
regardless of nonperformance by any other party or parties to an agreement, and
(iii) any liability of such Person for the obligations of another through any
agreement to purchase, repurchase, or otherwise acquire such obligation or any
property constituting security therefor, to provide funds for the payment or
discharge of such obligation, or to maintain the solvency, financial condition,
or any balance sheet item or level of income of another. The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
guaranteed or otherwise supported or, if not a fixed and determined amount, the
maximum amount so guaranteed. The amount of any Contingent Obligation
outstanding under CLAUSE (c) shall be determined in accordance with the
definition of Interest Rate Agreement. The amount of any Contingent Obligation
outstanding under CLAUSE (c) shall be the net amount determined in good faith by
Administrative Agent using any convention or method used by Administrative Agent
in quantifying its own exposure under such agreements or arrangements.
"CONTINUE," "CONTINUATION," and "CONTINUED" each refers to the
continuation of a Eurodollar Loan from one Interest Period to another Interest
Period pursuant to SECTION 2.9.
"CONTINUING LENDERS" has the meaning given that term in SECTION 12.16.
"CONVERT," "CONVERSION," and "CONVERTED" each refers to the conversion
of a Loan of one Type into a Loan of another Type pursuant to SECTION 2.10.
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
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"CREDIT EVENT" means any of the following: (a) the making (or deemed
making) of any Loan, (b) the Conversion of a Loan, or (c) the issuance of any
LC.
"CREDIT RATING" means, at any time as to any Person, the lowest rating
assigned by a Rating Agency to each series of rated senior unsecured long term
indebtedness of such Person.
"DEBT" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money and under repurchase
agreements;
(b) its liabilities for the deferred purchase price of property
acquired by such Person (excluding accounts payable arising in the
ordinary course of business, but including, without limitation, all
liabilities created or arising under any conditional sale or other title
retention agreement with respect to any such property);
(c) its Capitalized Lease Obligations;
(d) all liabilities for borrowed money secured by any Lien with
respect to any property owned by such Person (whether or not it has
assumed or otherwise become liable for such liabilities);
(e) all reimbursement obligations of such Person under any
letters of credit or acceptances (whether or not the same have been
presented for payment), and all obligations of such Person as the issuer
of any letters of credit or acceptances (whether or not the same have
been presented for payment); and
(f) any Contingent Obligation of such Person with respect to
liabilities of a type described in any of CLAUSES (a) through (e)
hereof.
"Debt" of any Person shall include all obligations of such Person of the
character described in CLAUSES (a) through (e) to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
deemed to be extinguished under GAAP.
"DEFAULT" means any of the events specified in SECTION 10.1, whether or
not there has been satisfied any requirement for the giving of notice, the lapse
of time, or both.
"DEFAULTING LENDER" has the meaning given that term in SECTION 3.13.
"DOCUMENTATION AGENT" means Fleet National Bank and its permitted
successors or assigns as "Documentation Agent" under this Agreement.
"DOLLARS" or "$" means the lawful currency of the United States of
America.
"EFFECTIVE DATE" means the later of: (a) the Agreement Date; and (b) the
date on which all of the conditions precedent set forth in SECTION 5.1 shall
have been satisfied or waived but (c) must be, if at all, a Business Day
occurring no later than May 19, 2000.
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
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"ELIGIBLE ASSIGNEE" means (i) a Lender; (ii) an Affiliate of a Lender;
and (iii) any other Person approved by Administrative Agent and (unless an Event
of Default has occurred and is continuing at the time any assignment is effected
in accordance with SECTION 12.4) Borrower, such approval not to be unreasonably
withheld or delayed by Borrower or Administrative Agent and such approval to be
deemed given by Borrower if no objection is received by the assigning Lender and
Administrative Agent from Borrower within five Business Days after notice of
such proposed assignment has been provided by the assigning Lender to
Borrower; provided, however, that neither Borrower nor an Affiliate of Borrower
shall qualify as an Eligible Assignee.
"ENVIRONMENTAL LAWS" means any Applicable Law relating to environmental
protection or the manufacture, storage, disposal, or clean-up of Hazardous
Materials, including, without limitation, the following: Clean Air Act, 42
U.S.C. 7401 et seq.; Federal Water Pollution Control Act, 33 U.S.C. 1251 et
seq.; Solid Waste Disposal Act, 42 U.S.C. 6901 et seq.; Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. 9601 et seq.;
National Environmental Policy Act, 42 U.S.C. 4321 et seq.; regulations of the
Environmental Protection Agency, and any applicable rule of common law and any
judicial interpretation thereof relating primarily to the environment or
Hazardous Materials.
"EQUITY ISSUANCE" means any issuance or sale by a Person of its capital
stock or other similar equity security, or any warrants, options, or similar
rights to acquire, or securities convertible into or exchangeable for, such
capital stock or other similar equity security.
"ERISA" means the Employee Retirement Income Security Act of 1974, as in
effect from time to time.
"ERISA GROUP" means Borrower, any Subsidiary, and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
"EURODOLLAR LOAN" means a Loan bearing interest at a rate based on the
Eurodollar Rate.
"EURODOLLAR RATE" means, for any Eurodollar Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Dow ▇▇▇▇▇ Markets Page 3750 (or any successor page) as
the London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any reason such
rate is not available, the term "EURODOLLAR RATE" shall mean, for any Eurodollar
Loan for any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as
the London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period; provided, however, if more
than one rate is specified on Reuters Screen LIBO Page, the applicable rate
shall be the arithmetic mean of all such rates (rounded upwards, if necessary,
to the nearest 1/100 of 1%).
"EVENT OF DEFAULT" means any of the events specified in SECTION 10.1,
provided that, any requirement for notice or lapse of time or any other
condition has been satisfied.
"EXCHANGE ACT" has the meaning given that term in SECTION 10.1(m).
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
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"EXISTING AGREEMENT" is defined in the Recitals to this Agreement.
"EXISTING LENDERS" is defined in the Recitals to this Agreement.
"EXTENSION REQUEST" has the meaning given that term in SECTION 2.14.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that(a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to Administrative
Agent (in its individual capacity) on such day on such transactions as
determined by Administrative Agent.
"FEES" means the fees and commissions provided for or referred to
in SECTION 3.8 and any other fees payable by Borrower to Administrative Agent,
any other Agent, or any Lender hereunder or under any other Loan Document.
"FORECLOSURE PROPERTY" means assets acquired by foreclosure (or sale in
lieu of foreclosure) of any Investment (other than Investments in a Consolidated
Subsidiary) of Borrower or any of its Subsidiaries.
"GAAP" means, subject to SECTION 1.3, accounting principles as
promulgated from time to time in statements, opinions and pronouncements by the
American Institute of Certified Public Accountants and the Financial Accounting
Standards Board and in such statements, opinions and pronouncements of such
other entities with respect to financial accounting of for-profit entities as
shall be accepted by a substantial segment of the accounting profession in the
United States.
"GOVERNMENTAL APPROVALS" means all authorizations, consents, approvals,
licenses, and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"GOVERNMENTAL AUTHORITY" means any national, state, or local government
(whether domestic or foreign), any political subdivision thereof or any other
governmental, quasi-governmental, judicial, public, or statutory
instrumentality, authority, body, agency, bureau, or entity (including, without
limitation, the Federal Deposit Insurance Corporation, the Comptroller of the
Currency, or the Federal Reserve Board, any central bank, or any comparable
authority) or any arbitrator with authority to bind a party at law.
"HAZARDOUS MATERIALS" means all or any of the following: (a) substances
that are defined or listed in, or otherwise classified pursuant to, any
applicable Environmental Laws as "hazardous substances," "hazardous materials,"
"hazardous wastes," "toxic substances," or any other formulation intended to
define, list or classify substances by reason of deleterious properties such as
ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity,
"TLCP" toxicity, or "EP toxicity"; (b) oil, petroleum, or petroleum derived
substances, natural gas, natural gas liquids, or synthetic gas and drilling
fluids, produced waters, and other wastes associated with the exploration,
development, or production of crude oil, natural gas, or geothermal resources;
(c) any flammable substances or explosives or any radioactive materials; (d)
asbestos
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
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in any form; or (e) electrical equipment which contains any oil or dielectric
fluid containing levels of polychlorinated biphenyls in excess of fifty parts
per million.
"INDEBTEDNESS" means, with respect to a Person, at the time of
computation thereof, all of the following (without duplication): (a) obligations
of such Person in respect of money borrowed; (b) obligations of such Person
(other than trade debt incurred in the ordinary course of business), whether or
not for money borrowed (i) represented by notes payable or drafts accepted, in
each case representing extensions of credit, (ii) evidenced by bonds,
debentures, notes, or similar instruments, (iii) consisting of repurchase
agreements, whether on a recourse or a non-recourse basis, or (iv) constituting
purchase money indebtedness, conditional sales contracts, title retention debt
instruments, or other similar instruments, upon which interest charges are
customarily paid or that are issued or assumed as full or partial payment for
property; (c) Capitalized Lease Obligations of such Person; (d) all
reimbursement obligations of such Person under any letters of credit or
acceptances (whether or not the same have been presented for payment), and all
obligations of such Person as the issuer of any letters of credit or acceptances
(whether or not the same have been presented for payment); and (e) all
Indebtedness of other Persons which (i) such Person has guaranteed or which is
otherwise recourse to such Person or (ii) are secured by a Lien on any property
of such Person.
"INTELLECTUAL PROPERTY" has the meaning given that term in SECTION
6.1(r).
"INTERCREDITOR AGREEMENT" means an intercreditor agreement pursuant to
which the Lenders and the holders of any other Debt of Borrower have agreed to
share payments made by any Consolidated Subsidiary under a Subsidiary Bank
Guaranty, a Subsidiary Senior Note Guaranty, or any other guaranty of any Debt
of Borrower on an equal and ratable basis.
"INTEREST EXPENSE" means, with respect to a Person and for any period,
the total consolidated interest expense (including, without limitation,
capitalized interest expense and interest expense attributable to Capitalized
Lease Obligations) of such Person and in any event shall include all interest
expense with respect to any Indebtedness in respect of which such Person is
wholly or partially liable.
"INTEREST PERIOD" means, with respect to any Eurodollar Loan, each
period commencing on the date such Eurodollar Loan is made or the last day of
the next preceding Interest Period for such Loan and ending on the numerically
corresponding day in the first, second, third, or sixth calendar month
thereafter, as Borrower may select in a Notice of Borrowing, Notice of
Continuation or Notice of Conversion, as the case may be, except that each
Interest Period for a Eurodollar Loan that commences on the last Business Day of
a calendar month (or on any day for which there is no numerically corresponding
day in the appropriate subsequent calendar month) shall end on the last Business
Day of the appropriate subsequent calendar month. Notwithstanding the foregoing:
(i) if any Interest Period would otherwise end after the Termination Date, such
Interest Period shall end on the Termination Date, (ii) each Interest Period
that would otherwise end on a day which is not a Business Day shall end on the
next succeeding Business Day (or, if such next succeeding Business Day falls in
the next succeeding calendar month, on the next preceding Business Day), and
(iii) notwithstanding the immediately preceding CLAUSE (i), no Interest Period
for any Eurodollar Loan shall have a duration of less than one month and, if the
Interest Period for any Eurodollar Loan would otherwise be a shorter period,
such Loan shall not be available hereunder for such period.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement, or other similar
contractual agreement or arrangement entered into with a nationally recognized
financial institution then having an Investment Grade Rating for the purpose of
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protecting against fluctuations in interest rates. For the purposes of this
Agreement, the amount of any obligation under any Interest Rate Agreement shall
be the amount determined in respect thereof as of the end of the most recently
ended fiscal quarter of such Person, based on the assumption that such Interest
Rate Agreement had terminated at the end of such fiscal quarter, and in making
such determination, if such Interest Rate Agreement provides for the netting of
amounts payable by and to such Person thereunder or if such Interest Rate
Agreement provides for the simultaneous payment of amounts by and to such
Person, then in each such case, the amount of such obligation shall be the net
amount so determined.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended, together with the rules and regulations promulgated thereunder.
"INVESTMENT" means, with respect to any Person and whether or not such
investment constitutes a controlling interest in such Person (a) the purchase or
other acquisition of any share of capital stock, evidence of Indebtedness, or
other security issued by any other Person; (b) any loan, advance, or extension
of credit to, or contribution (in the form of money or goods) to the capital of
or the acquisition of a sale leaseback asset from and the lease thereof to, any
other Person; (c) any guaranty of the Indebtedness of any other Person; (d) any
other investment in any other Person; and (e) any commitment or option to make
an Investment in any other Person.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as
amended, and the rules and regulations promulgated thereunder.
"INVESTMENT GRADE RATING" means a Credit Rating of BBB- or higher by
S&P, Baa3 or higher by ▇▇▇▇▇'▇, or the equivalent or higher of either such
rating by another Rating Agency.
"LC" means the letter(s) of credit issued hereunder in the form agreed
upon among Borrower, Administrative Agent, and the beneficiary thereof at the
time of issuance thereof pursuant to the terms and conditions of SECTION 2.3
hereof.
"LC AGREEMENT" means a letter of credit application and agreement (in
form and substance satisfactory to Administrative Agent) submitted by Borrower
to Administrative Agent for an LC for its own account.
"LC EXPOSURE" means, at any time and without duplication, the sum of (a)
the aggregate undrawn portion of all uncancelled and unexpired LCs plus (b) the
aggregate unpaid reimbursement obligations of Borrower in respect of drawings of
drafts under any LC.
"LC REQUEST" means a request pursuant to SECTION 2.3(a), substantially
in the form of EXHIBIT B-2.
"LC SUBFACILITY" means a subfacility for the issuance of LCs (the LC
Exposure in connection with which may never exceed $10,000,000), as described in
and subject to the limitations of SECTION 2.3.
"LENDERS" means, on any date of determination, the financial
institutions named on SCHEDULE 2 (as the same may be amended from time to time
by Administrative Agent to reflect the assignments made in accordance with
SECTION 12.4(a) of this Agreement), and subject to the terms and conditions of
this Agreement, their respective successors and assigns.
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"LENDING OFFICE" means, for each Lender and for each Type of Loan,
the "LENDING OFFICE" of such Lender (or of an Affiliate of such Lender)
designated for such Type of Loan on SCHEDULE 2 or in the applicable Assignment
and Acceptance Agreement or such other office of such Lender (or an Affiliate of
such Lender) as such Lender may from time to time specify to Administrative
Agent and Borrower by written notice in accordance with the terms hereof as the
office by which its Loans of such Type are to be made and maintained.
"LENDING PARTY" has the meaning given that term in SECTION 12.7.
"LIEN" as applied to the property of any Person means: (a) any security
interest, encumbrance, mortgage, deed to secure debt, deed of trust, pledge,
lien, charge, ground lease, or lease constituting a Capitalized Lease
Obligation, conditional sale or other title retention agreement, or other
security title or encumbrance of any kind in respect of any property of such
Person, or upon the income or profits therefrom; (b) any arrangement, express or
implied, under which any property of such Person is transferred, sequestered, or
otherwise identified for the purpose of subjecting the same to the payment of
Indebtedness or performance of any other obligation in priority to the payment
of the general, unsecured creditors of such Person; (c) the filing of any
financing statement under the Uniform Commercial Code or its equivalent in any
jurisdiction; and (d) any agreement by such Person to grant, give, or otherwise
convey any of the foregoing.
"LOAN DOCUMENTS" means (a) this Agreement, the Notes, LCs, and LC
Agreements, (b) all agreements, documents, or instruments in favor of
Administrative Agent or the Lenders ever delivered pursuant to this Agreement or
otherwise delivered in connection with all or any part of the Obligations on and
after the Effective Date, (c) any Interest Rate Agreement between Borrower or
any of its Subsidiaries and any Lender or any Affiliate of any Lender, and (d)
any and all future renewals, extensions, restatements, reaffirmations,
amendments of, or supplements to, all or any part of the foregoing.
"LOANS" means any amount disbursed (a) by one or more Lenders to
Borrower under the Loan Documents (whether under the Revolving Facility, the LC
Subfacility, or the Swing Line Subfacility), whether such amount constitutes an
original disbursement of funds or the continuation of any amount outstanding, or
payment of a draft under an LC, or (b) by any Lender in accordance with, and to
satisfy the obligations of any Borrower or any Subsidiary of Borrower under, any
Loan Document.
"MANAGING AGENT" means ▇▇▇▇▇ Bank N.A. and its permitted successors or
assigns as "Managing Agent" under this Agreement.
"MATERIAL ADVERSE EFFECT" means a materially adverse effect on (a) the
business, assets, liabilities, financial condition, results of operations, or
business prospects of Borrower and its Consolidated Subsidiaries taken as a
whole, (b) the ability of Borrower to perform its obligations under any Loan
Document to which it is a party which does not result from a material adverse
effect on the items described in the immediate preceding CLAUSE (a), (c) the
validity or enforceability of any of the Loan Documents, (d) the rights and
remedies of the Lenders and Administrative Agent under any of such Loan
Documents, or (e) the timely payment of the principal of or interest on the
Loans or other amounts payable in connection therewith. Except with respect to
representations made or deemed made by Borrower or any Subsidiary in any of the
other Loan Documents to which it is a party, all determinations of materiality
shall be made by the Requisite Lenders in their reasonable judgment unless
expressly provided otherwise.
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"MATERIAL CONTRACT" means any contract or other arrangement (other than
Loan Documents), whether written or oral, to which Borrower or any Subsidiary is
a party as to which the breach, nonperformance, cancellation, or failure to
renew by any party thereto could have a Material Adverse Effect.
"MATERIAL PLAN" means at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of $5,000,000.
"MATERIAL SUBSIDIARY" means, as of the date of any determination
thereof, any Subsidiary which has total assets having a value (determined in
accordance with the market valuation method pursuant to GAAP) greater than or
equal to $40,000,000.
"MAXIMUM AMOUNT" and "MAXIMUM RATE" respectively mean, for each Lender,
the maximum non-usurious amount and the maximum non-usurious rate of interest
which, under Applicable Law, such Lender is permitted to contract for, charge,
take, reserve, or receive on the Obligations.
"MONEY MARKET RATE" means, as to any Swing Line Loan made pursuant
to SECTION 2.2, a rate per annum equal to the sum of (a) 1.50% and (b) the rate
per annum equal to Bank of America's cost of funds.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Services, Inc.
"MORTGAGE REPURCHASE FACILITY" means financing agreements providing for
(i) the pledge and assignment of Commercial Mortgage Loans owned by Borrower and
its Consolidated Subsidiaries as security for loans to Borrower and its
Consolidated Subsidiaries, or (ii) the sale of such Commercial Mortgage Loans to
a commercial lender pursuant to an agreement under which such loans shall be
repurchased by Borrower or a Consolidated Subsidiary at a future date.
"MULTIEMPLOYER PLAN" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.
"NET PROCEEDS" means, with respect to an Equity Issuance by a Person,
the aggregate amount of all cash (including any cash received by way of deferred
payment pursuant to a promissory note, or otherwise, but only as and when
received) received by such Person in respect of such Equity Issuance net of
investment banking fees, legal fees, accountants fees, underwriting discounts
and commissions, and other customary fees and expenses actually incurred by such
Person in connection with such Equity Issuance.
"NON-CONTINUING LENDER" has the meaning given that term in SECTION
12.16.
"NON-RECOURSE INDEBTEDNESS" means Indebtedness secured by Real Estate
Assets if recourse for the payment of such Indebtedness is limited to such Real
Estate Assets.
"NOTES" means, at the time of any determination thereof, all outstanding
and unpaid Revolving Notes and Swing Line Notes.
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"NOTICE OF BORROWING" means a notice in the form of EXHIBIT B-1 to be
delivered to the Administrative Agent pursuant to SECTION 2.4(a) evidencing
Borrower's request for a borrowing of Loans.
"NOTICE OF CONTINUATION" means a notice in the form of EXHIBIT C to be
delivered to the Administrative Agent pursuant to SECTION 2.9 evidencing
Borrower's request for the Continuation of a Eurodollar Loan.
"NOTICE OF CONVERSION" means a notice in the form of EXHIBIT D to be
delivered to the Administrative Agent pursuant to SECTION 2.10 evidencing
Borrower's request for the Conversion of a Loan from one Type to another Type.
"NOTICE OF DEFAULT" has the meaning given that term in SECTION 11.3.
"OBLIGATIONS" means, individually and collectively: (a) the aggregate
principal balance of and all accrued and unpaid interest on, all Loans and (b)
all other indebtedness, liabilities, obligations, covenants and duties of
Borrower owing to Administrative Agent or any Lender of every kind, nature and
description, under or in respect of this Agreement or any of the other Loan
Documents, including, without limitation, all Fees and indemnification
obligations, whether direct or indirect, absolute or contingent, due or not due,
contractual or tortious, liquidated or unliquidated, and whether or not
evidenced by any promissory note.
"OFFERING MEMORANDUM" means the Confidential Offering Memorandum dated
January 1999, for the Existing Agreement (which Existing Agreement is being
amended and restated by this Agreement).
"OTHER RELEVANT SUBSIDIARY" means any Subsidiary, individually or
together with other Subsidiaries, the occurrence of any of the events described
in SECTIONS 10.1(f) or 10.1(g) with respect to which could reasonably be
expected to have a Material Adverse Effect.
"OTHER TAXES" has the meaning given that term in SECTION 4.6(b).
"PARTICIPANT" has the meaning given that term in SECTION 12.4(d).
"PBGC" means the Pension Benefit Guaranty Corporation and any successor
agency.
"PERMITTED LIENS" means, as to any Person: (a) Liens securing taxes,
assessments, and other charges or levies imposed by any Governmental Authority
(excluding any Lien imposed pursuant to any of the provisions of ERISA) or the
claims of materialmen, mechanics, carriers, warehousemen, or landlords for
labor, materials, supplies, or rentals incurred in the ordinary course of
business, which are not at the time required to be paid or discharged under
SECTION 7.6; (b) Liens consisting of deposits or pledges made, in the ordinary
course of business, in connection with, or to secure payment of, obligations
under workmen's compensation, unemployment insurance, or similar Applicable
Laws; (c) Liens in favor of Administrative Agent for the benefit of the Lenders;
and (d) covenants, restrictions, rights of way, easements, and other matters of
public record, and other matters to which like properties are commonly subject,
that singly or in the aggregate do not materially and adversely affect the value
or marketability of, or materially interfere with the use or enjoyment of any
asset of such Person.
"PERMITTED PREFERRED STOCK" means (i) preferred stock that is issued
from time to time by a Subsidiary to the United States Small Business
Administration having an aggregate stated value not
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exceeding $7,000,000 at any one time outstanding, or (ii) preferred stock that
is issued from time to time by a Subsidiary for the purpose of qualifying such
Subsidiary as a real estate investment trust under Sections 856 through 860 of
the Internal Revenue Code and having an aggregate stated value not exceeding
$500,000 at any one time outstanding; provided that, in any event Permitted
Preferred Stock shall not include any Voting Stock.
"PERSON" means an individual, corporation, partnership, limited
liability company, association, trust or unincorporated organization, or a
government or any agency or political subdivision thereof.
"PLAN" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.
"POST-DEFAULT RATE" means, in respect of any principal of any Loan or
any other Obligation that is not paid when due (whether at stated maturity, by
acceleration, by optional or mandatory prepayment or otherwise), a rate per
annum equal to the lesser of (i) the Maximum Rate and (ii) the sum of 2.0% plus
the Base Rate as in effect from time to time.
"PRIME RATE" means the per annum rate of interest established from time
to time by Bank of America as its prime rate, which rate may not be the lowest
rate of interest charged by Bank of America to its customers.
"PRINCIPAL DEBT" means, at any time of determination thereof, the
aggregate unpaid principal balance of all Loans.
"PRINCIPAL OFFICE" means the principal office of Bank of America,
presently located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
"PRIORITY DEBT" means the sum of (i) all Secured Indebtedness of
Borrower and its Consolidated Subsidiaries, and (ii) all unsecured Debt of
Consolidated Subsidiaries (excluding in each case, Debt owing to Borrower or
another Consolidated Subsidiary).
"QUARTERLY DATE" means the last Business Day of March, June, September,
and December in each year, the first of which shall be June 30, 2000.
"RATING AGENCY" means S&P, Moody's or any other nationally recognized
securities rating agency selected by Borrower and acceptable to the Requisite
Lenders.
"REAL ESTATE" means fee ownership or co-ownership of, or leaseholds of,
land or improvements thereon.
"REAL ESTATE ASSETS" means (i) Real Estate securing Investments made in
the ordinary course of business, (ii) Commercial Mortgage Loans, and (iii)
Related Collateral.
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"REGISTER" has the meaning given that term in SECTION 12.4(b).
"REIT" means Allied Capital REIT, Inc., a Maryland corporation.
"RELATED COLLATERAL" means, in respect of any Commercial Mortgage Loan:
(i) any and all documents, instruments, agreements, records, or other collateral
of any kind evidencing, securing, guaranteeing, or otherwise relating to such
Commercial Mortgage Loan, including, without limitation, all promissory notes or
other negotiable instruments, mortgages, deeds of trust, or similar instruments,
assignments of leases or rents or other collateral assignments, financing
statements, guaranties, indemnities, servicing agreements, servicing records,
files, surveys, certificates, affidavits, title abstracts, title insurance
policies and commitments, correspondence, opinions, appraisals, closing
documents, computer programs, computer storage media, data bases, accounting
records, and other books and records relating thereto, (ii) any and all mortgage
guaranties and insurance (issued by governmental agencies or otherwise) and
mortgage insurance certificates or other documents evidencing such mortgage
guaranties or insurance relating to any such Commercial Mortgage Loan and all
claims and payments thereunder, (iii) any and all other insurance policies and
insurance proceeds relating to such Commercial Mortgage Loan or the related real
property, (iv) all "general intangibles" as defined in the Uniform Commercial
Code relating to or constituting any and all of the foregoing, and (v) any and
all replacements, substitutions, or distributions on or proceeds of any and all
of the foregoing.
"REQUISITE LENDERS" means (a) on any date of determination prior to the
Termination Date, those Lenders holding 66 2/3% or more of the aggregate
Commitments of all Lenders; and (b) on any date of determination on or after the
Termination Date, those Lenders holding 66 2/3% of the aggregate Principal Debt.
"RESERVE REQUIREMENT" means, at any time, the maximum rate at which
reserves (including, without limitation, any marginal, special, supplemental, or
emergency reserves) are required to be maintained under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or any
successor) by member banks of the Federal Reserve System against, in the case of
Eurodollar Loans, "Eurocurrency liabilities" (as such term is used in Regulation
D of the Board of Governors of the Federal Reserve System, as amended). Without
limiting the effect of the foregoing, the Reserve Requirement shall reflect any
other reserves required to be maintained by such member banks with respect to
any category of liabilities which includes deposits by reference to which the
Adjusted Eurodollar Rate is to be determined, or (ii) any category of extensions
of credit or other assets which include Eurodollar Loans. The Adjusted
Eurodollar Rate shall be adjusted automatically on and as of the effective date
of any change in the Reserve Requirement.
"RESPONSE DATE" has the meaning given that term in SECTION 2.14.
"REVOLVING FACILITY" means the credit facility as described in and
subject to the limitations of SECTION 2, including the Swing Line Subfacility
and the LC Subfacility.
"REVOLVING LOAN" means any Loan under the Revolving Facility other than
a Swing Line Loan or the issuance of an LC.
"REVOLVING NOTE" has the meaning given that term in SECTION 2.11(a).
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"RIC" means a Person qualifying for treatment as a "regulated investment
company" under the Internal Revenue Code.
"SBA" means the Small Business Administration.
"SBA ACT" means the Small Business Investment Act of 1958, as amended.
"SBIC" means Allied Investment Corporation, a Maryland corporation.
"SBLC" means Allied Capital SBLC Corporation, a Maryland corporation.
"SECURED INDEBTEDNESS" means, with respect to any Person, any
Indebtedness of such Person that is secured in any manner by any Lien.
"SENIOR DEBT" means Debt under the Senior Note Agreements or any similar
facility entered into by Borrower or its Consolidated Subsidiaries.
"SENIOR NOTE AGREEMENTS" mean (a) the Note Agreement, dated as of April
30, 1998, among Borrower and the purchasers parties thereto, pursuant to which
Borrower has issued its $140,000,000 7.055% Senior Notes, Series A, due May 30,
2003, its $30,000,000 7.168% Senior Notes, Series B, due May 30, 2005, and its
$10,000,000 9.530% Senior Notes, Series C, due May 30, 2005, and any replacement
thereof; (b) the Note Agreement, dated as of May 1, 1999, among Borrower and the
purchasers parties thereto, pursuant to which Borrower has issued its
$112,000,000 7.39% Senior Notes, Series A, due May 1, 2004, and its $25,000,000
7.49% Senior Notes, Series B, due May 1, 2006, and any replacement thereof; and
(c) the Note Agreement, dated as of November 15, 1999, among Borrower and the
purchasers parties thereof, pursuant to which Borrower has issued its
$102,000,000 8.51% Senior Notes, due November 15, 2004, and any replacement
thereof.
"SENIOR NOTE HOLDER" means any registered holder of a note or notes
issued under the Senior Note Agreements.
"SENIOR NOTES" means the notes issued by Borrower pursuant to the Senior
Note Agreements.
"SOLVENT" means, when used with respect to any Person, that (a) the fair
value and the fair salable value of its assets (excluding any Indebtedness due
from any affiliate of such Person) are each in excess of the fair valuation of
its total liabilities (including all contingent liabilities); (b) such Person is
able to pay its debts or other obligations in the ordinary course as they
mature; and (c) the Person has capital not unreasonably small to carry on its
business and all business in which it proposes to be engaged.
"S&P" means Standard & Poor's Rating Group, a division of ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc.
"SPECIAL PURPOSE SUBSIDIARY" means a Subsidiary (other than a
Consolidated Subsidiary) of Borrower the sole purpose of which is to purchase
assets from Borrower or a Subsidiary of Borrower and to effect a sale to a third
party (directly or through one or more Subsidiaries of such purchasing
Subsidiary) of the assets so purchased or of securities or Debt secured by or
evidencing an interest in such assets or in the holder thereof, and matters
incidental to the foregoing.
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"SUBFACILITY" means, any of the LC Subfacility or the Swing Line
Subfacility.
"SUBORDINATED DEBT" means Indebtedness of Borrower or any of its
Subsidiaries that is subordinated in right of payment and otherwise to the Loans
and the other Obligations in a manner satisfactory to Administrative Agent and
the Requisite Lenders in their sole and absolute discretion.
"SUBSIDIARY" means, for any Person, any corporation, partnership,
limited liability company, 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
(without regard to the occurrence 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.
Notwithstanding the foregoing, a portfolio Investment of Borrower or a
Subsidiary shall not be a Subsidiary of Borrower or such Subsidiary.
"SUBSIDIARY BANK GUARANTY" means any agreement pursuant to which a
Consolidated Subsidiary has guaranteed the Debt of Borrower under the Notes.
"SUBSIDIARY SENIOR NOTE GUARANTY" means any agreement pursuant to which
a Consolidated Subsidiary has guaranteed the Debt of Borrower under the Senior
Notes.
"SWING LINE COMMITMENT" means an amount (subject to reduction or
cancellation as herein provided) equal to $50,000,000.
"SWING LINE LOAN" means any Loan made under the Swing Line Subfacility.
"SWING LINE NOTE" has the meaning given that term in SECTION 2.11(b).
"SWING LINE SUBFACILITY" means the subfacility under the Revolving
Facility (the portion of the Loans attributable to which may never exceed in the
aggregate $50,000,000), as described in, and subject to the limitations
of, SECTION 2.2.
"SWING PRINCIPAL DEBT" means, on any date of determination, the
aggregate unpaid principal amount of all Loans outstanding under the Swing Line
Subfacility.
"SYNDICATION AGENT" means First Union National Bank and its permitted
successors or assigns as "Syndication Agent" under this Agreement.
"TAXES" has the meaning given that term in SECTION 4.6.
"TERMINATION DATE" means the earlier of either (a) May 17, 2002, (or
such later date to which the Termination Date is extended pursuant to the
provisions of SECTION 2.14) or (b) such earlier date upon which the whole of the
Commitments are terminated pursuant to SECTIONS 2.12 or otherwise.
"TYPE" with respect to any Loan, refers to whether such Loan is a
Eurodollar Loan or Base Rate Loan.
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"UNFUNDED LIABILITIES" means, with respect to any Plan at any time, the
amount (if any) by which (a) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA, exceeds (b) the fair market
value of all Plan assets allocable to such liabilities under Title IV of ERISA
(excluding any accrued but unpaid contributions), all determined as of the then
most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.
"UNRESTRICTED SUBSIDIARY" means a Subsidiary of Borrower (a) that is not
a Consolidated Subsidiary or (b) is a Consolidated Subsidiary the sole purpose
of which is to acquire, hold, manage, and dispose of Foreclosure Property, and
matters incidental to such purposes.
"VOTING STOCK" shall mean securities of any class or classes, the
holders of which are ordinarily, in the absence of contingencies, entitled to
elect a majority of the corporate directors (or Persons performing similar
functions).
"WHOLLY OWNED" when used in connection with any Subsidiary means any
corporation, partnership, limited liability company, or other entity of which
all of the equity securities or other ownership interests (other than Permitted
Preferred Stock and, in the case of a corporation, directors' qualifying shares)
are so owned or controlled.
1.2 GENERAL; REFERENCES TO TIMES. References in this Agreement to
"Sections," "Exhibits," and "Schedules" are to sections, exhibits, and schedules
herein and hereto unless otherwise indicated. References in this Agreement to
any document, instrument, or agreement (a) shall include all exhibits,
schedules, and other attachments thereto, (b) shall include all documents,
instruments, or agreements issued or executed in replacement thereof, to the
extent permitted hereby and (c) shall mean such document, instrument, or
agreement, or replacement or predecessor thereto, as amended, supplemented,
restated, or otherwise modified from time to time to the extent permitted hereby
and in effect at any given time. Wherever from the context it appears
appropriate, each term stated in either the singular or plural shall include the
singular and plural, and pronouns stated in the masculine, feminine, or neuter
gender shall include the masculine, the feminine and the neuter. Unless
explicitly set forth to the contrary, a reference to "Subsidiary" means a
Subsidiary of Borrower or a Subsidiary of such Subsidiary, and a reference to an
"Affiliate" means a reference to an Affiliate of Borrower. Titles and captions
of Sections, subsections, and clauses in this Agreement are for convenience
only, and neither limit nor amplify the provisions of this Agreement. Unless
otherwise indicated, all references to time are references to Dallas, Texas,
time.
1.3 ACCOUNTING PRINCIPLES. All accounting and financial terms used in
the Loan Documents and the compliance with each financial covenant therein shall
be determined in accordance with GAAP, and, all accounting principles shall be
applied on a consistent basis so that the accounting principles in a current
period are comparable in all material respects to those applied during the
preceding comparable period. If Borrower or any Lender determines that a change
in GAAP from that in effect on the date hereof has altered the treatment of
certain financial data to its detriment under this Agreement, such party may, by
written notice to the others and Administrative Agent not later than 30 days
after Borrower's delivery of any financial statements pursuant to SECTION 8.1 or
8.2 reflecting such change in GAAP, request renegotiation of the financial
covenants affected by such change. If Borrower and Requisite Lenders have not
agreed on revised covenants within 30 days after delivery of such notice, then,
for purposes of this Agreement, GAAP
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will mean generally accepted accounting principles on the date just prior to the
date on which the change that gave rise to the renegotiation occurred.
SECTION 2 CREDIT FACILITY.
2.1 LOANS. Subject to the terms and conditions hereof, during the period
from the Effective Date to but excluding the Termination Date, each Lender
severally and not jointly agrees to make Revolving Loans to Borrower in an
aggregate principal amount at any one time outstanding up to, but not exceeding,
the amount of such Lender's Commitment; provided, however, that on any date of
determination, the Commitment Usage shall never exceed the aggregate amount of
the Commitments as in effect from time to time. Subject to the terms and
conditions of this Agreement, during the period from the Effective Date to but
excluding the Termination Date, Borrower may borrow, repay and reborrow
Revolving Loans hereunder.
2.2 SWING LINE SUBFACILITY.
(a) Swing Line Loans. For the convenience of the parties and as
an integral part of the transactions contemplated by the Loan Documents,
Bank of America, solely for its own account, may make any requested Loan
of $250,000 or a greater integral multiple thereof, subject to those
terms and conditions applicable to Loans set forth in CLAUSES
(a) and (b) of the first sentence of SECTION 5.2, directly to Borrower
as a Swing Line Loan without requiring any other Lender to fund its
ratable portion thereof unless and until SECTION 2.2(b) is applicable;
provided that: (i) each such Swing Line Loan must occur on a Business
Day prior to, and not on or after, the Termination Date; (ii) the
aggregate Swing Principal Debt outstanding on any date of determination
shall not exceed the Swing Line Commitment; (iii) on any date of
determination, the Commitment Usage shall never exceed the aggregate
amount of the Commitments of the Lenders; (iv) at the time of such Swing
Line Loan, no Default or Event of Default shall have occurred and be
continuing; (v) each Swing Line Loan shall be at a rate per annum equal
to the lesser of (a) the Money Market Rate,and (b) the Maximum Rate;
provided that at any time after Revolving Lenders are deemed
to have purchased, pursuant to SECTION 2.2(b), a participation in any
Swing Line Borrowing, such Borrowing shall bear interest at the
Post-Default Rate; and (vi) no additional Swing Line Loan shall be made
at any time after any Lender has refused, notwithstanding the
requirements of SECTION 2.2(b), to purchase a participation in any Swing
Line Loan as provided in such Section, and until such purchase shall
occur or until the Swing Line Loan has been repaid. Each Swing Line Loan
under the Swing Line Subfacility shall be available and may be prepaid
on same day telephonic notice from Borrower to Bank of America,so long
as such notice is received by Bank of America prior to 1:00 p.m. Dallas,
Texas time. Each Swing Line Loan shall be repaid in full, together with
all accrued and unpaid interest thereon, not later than the tenth
Business Day after the date on which such Swing Line Loan was funded.
(b) Participations. If Borrower fails to repay any Swing Line
Loan as provided herein (and in any event upon the earlier to occur of a
Default or the Termination Date), Administrative Agent shall timely
notify each Lender of such failure and of the date and amount not paid.
No later than the close of business on the date such notice is given (if
such notice was given prior to 12:00 noon on any Business Day, or, if
made at any other time, on the next Business Day following the date of
such notice), each Lender shall be deemed to have irrevocably and
unconditionally purchased and received from Bank of America an undivided
interest and participation in such Swing Line Loan equal to its
Commitment Percentage of such Swing Line Loan, and each Lender shall
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make available to Bank of America in immediately available funds such
Lender's ratable part of such unpaid principal amount. All such amounts
payable by any Lender shall include interest thereon from the date on
which such payment is payable by such Lender to, but not including, the
date such amount is paid by such Lender to Administrative Agent, at the
Federal Funds Rate. If such Lender does not promptly pay such amount
upon Administrative Agent's demand therefor, and until such time as such
Lender makes the required payment, Bank of America shall be deemed to
continue to have outstanding a Swing Line Loan in the amount of such
unpaid obligation. Each payment by Borrower of all or any part of any
Swing Line Loan shall be paid to Administrative Agent for the ratable
benefit of Bank of America and those Lenders who have funded their
participations in such Swing Line Loan under this SECTION
2.2(b); provided that, with respect to any such participation, all
interest accruing on the Swing Principal Debt to which such
participation relates prior to the date of funding such participation
shall be payable solely to Bank of America for its own account.
2.3 LC SUBFACILITY.
(a) Conditions. Subject to the terms and conditions of this
Agreement and applicable Law, Administrative Agent agrees to issue LCs
upon Borrower's application therefor (denominated in Dollars) by
delivering to Administrative Agent a properly completed LC Request and
an LC Agreement with respect thereto no later than 10:00 a.m. Dallas,
Texas time three Business Days before such LC is to be issued; provided
that, (i) on any date of determination and after giving effect to any LC
to be issued on such date, the Commitment Usage shall never exceed the
aggregate amount of the Commitments as in effect from time to time, (ii)
on any date of determination and after giving effect to any LC to be
issued on such date, the LC Exposure shall never exceed $10,000,000,
(iii) at the time of issuance of such LC, no Default or Event of Default
shall have occurred and be continuing, and (iv) each LC must expire no
later than the earlier of the 30th day prior to the Termination Date, or
one year from its issuance; provided that, any LC may provide for
automatic renewal for periods of up to one year (but no renewal period
may extend beyond the 30th day prior to the Termination Date) unless
Administrative Agent has given prior notice to the applicable
beneficiary of its election not to extend such LC.
(b) Participations. Immediately upon the issuance by
Administrative Agent of any LC, Administrative Agent shall be deemed to
have sold and transferred to each other Lender, and each other such
Lender shall be deemed irrevocably and unconditionally to have purchased
and received from Administrative Agent, without recourse or warranty, an
undivided interest and participation, equal to such Lender's Commitment
Percentage of such LC, the LC Agreement, and all rights of
Administrative Agent in respect thereof (other than rights to receive
certain fees provided for in SECTION 3.8(d)(II)).
(c) Reimbursement Obligation. To induce Administrative Agent to
issue and maintain LCs and Lenders to participate in issued LCs,
Borrower agrees to pay or reimburse Administrative Agent (i) on the date
on which Administrative Agent makes any payments under any LC, the
amount of any payment made or to be made by Administrative Agent under
such LC, and (ii) promptly, upon demand, the amount of any applicable
fees (in addition to the Fees described in SECTION 3.8) which
Administrative Agent customarily charges to a Person similarly situated
in the ordinary course of its business for amending LC Agreements, for
honoring drafts, and taking similar action in connection with letters of
credit. If Borrower has not reimbursed Administrative Agent for any
payment made or to be made under any LC within 24 hours of demand
therefor by Administrative Agent, Administrative Agent is hereby
irrevocably authorized to fund such reimbursement obligation
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as a Loan to the extent of availability, and if the conditions precedent
in this Agreement for such a Loan (other than any notice requirements or
minimum funding amounts) have, to Administrative Agent's knowledge, been
satisfied. The proceeds of such Loan shall be advanced directly to
Administrative Agent in payment of Borrower's unpaid reimbursement
obligation. If for any reason, funds can not be advanced, then
Borrower's reimbursement obligation shall continue to be due and
payable. Borrower's obligations under this SECTION 2.3(c) shall
constitute a demand obligation and are absolute and unconditional under
any and all circumstances and irrespective of any setoff, counterclaim,
or defense to payment which Borrower may have at any time against
Administrative Agent or any other Person. From the date that
Administrative Agent makes a payment under an LC until the related
reimbursement obligation of Borrower is paid by Borrower or funded by
proceeds of a Loan, unpaid reimbursement obligations shall accrue
interest at the Post-Default Rate, which accrued interest shall be
payable on demand.
(d) General. If any demand for payment or drawing under any LC is
made, Administrative Agent shall promptly notify Borrower of the date
and amount thereof; provided that, failure to give any such notice shall
not affect the obligations of Borrower hereunder. Administrative Agent
shall pay the requested amount upon demand for payment or drawing unless
such demand on its face does not comply with the terms of such LC. When
making payment, the Administrative Agent may disregard (i) any default
or potential default that exists under any other agreement and (ii) the
obligations under any other agreement that have or have not been
performed by the beneficiary or any other Person (and Administrative
Agent shall not be liable for any obligation of any Person thereunder).
Borrower's reimbursement obligations to Administrative Agent and
Lenders, and each Lender's obligations to the Administrative Agent,
under this SECTION 2.3 are absolute and unconditional irrespective of,
and Administrative Agent is not responsible for, (i) the validity,
enforceability, sufficiency, accuracy, or genuineness of documents or
endorsements which appear appropriate on their face (even if they are in
any respect invalid, unenforceable, insufficient, inaccurate,
fraudulent, or forged), (ii) any dispute by Borrower or any Subsidiary
with or any Borrower or any Subsidiary's claims, setoffs, defenses,
counterclaims, or other rights against Administrative Agent, any Lender,
or any other Person, or (iii) the occurrence of any Default or Event of
Default. However, nothing in this SECTION 2.3 constitutes a waiver of
the rights of Borrower or any Lender to assert any claim or defense
based upon the gross negligence or willful misconduct of Administrative
Agent. To the extent any Lender has funded its ratable share of any
payment or drawing under an LC, then Administrative Agent shall promptly
distribute reimbursement payments received from Borrower to such Lender
according to its ratable share. In the event any payment by Borrower
received by Administrative Agent with respect to an LC and distributed
to Lenders on account of their participations therein is thereafter set
aside, avoided, or recovered from Administrative Agent in connection
with any receivership, liquidation, or bankruptcy proceeding, each
Lender which received such distribution shall, upon demand by
Administrative Agent, contribute such Lender's ratable portion of the
amount set aside, avoided, or recovered, together with interest at the
rate required to be paid by Administrative Agent upon the amount
required to be repaid by it.
(e) Obligation of Lenders. If Borrower fails to reimburse
Administrative Agent as provided in SECTION 2.3(c) within 24 hours of
the demand therefor and funds cannot be advanced under the Revolving
Facility or Swing Line Subfacility to satisfy such reimbursement
obligation, then Administrative Agent shall promptly notify each Lender
of such failure, of the date and amount of the drawing paid, and of such
Lender's Commitment Percentage thereof. Each Lender shall promptly and
unconditionally fund its participation interest in such unreimbursed
drawing by making
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available to Administrative Agent in immediately available funds such
Lender's Commitment Percentage of such unpaid reimbursement obligation.
Funds are due and payable to Administrative Agent on or before the close
of business on the Business Day on which such notice was given by
Administrative Agent to Lenders (if given prior to 1:00 p.m., Dallas,
Texas time) or on the next succeeding Business Day (if notice was given
after 1:00 p.m., Dallas, Texas time). All amounts payable by any Lender
shall include accrued interest at the Federal Funds Rate from the day
the applicable payment or drawing is paid by Administrative Agent to
(but not including) the date such amount is paid by such Lender to
Administrative Agent.
(f) Duties of Administrative Agent as Issuing Lender.
Administrative Agent agrees with each Lender that it will exercise and
give the same care and attention to each LC as it gives to its other
letters of credit, and Administrative Agent's sole liability to each
Lender with respect to such LCs (other than liability arising from the
gross negligence or willful misconduct of Administrative Agent) shall be
to distribute promptly to each Lender who has acquired a participating
interest therein such Lender's ratable portion of any payments made to
Administrative Agent by Borrower pursuant to SECTION 2.3(c). Each Lender
and Borrower agree that, in paying any demand for payment or drawing
under any LC, Administrative Agent shall not have any responsibility to
obtain any document (other than any documents required by the respective
LC) or to ascertain or inquire as to any document's validity,
enforceability, sufficiency, accuracy, or genuineness, or the authority
of any Person delivering any such document. Administrative Agent,
Lenders, and their respective representatives shall not be liable to any
other Lender or Borrower or any of its Subsidiaries for the use which
may be made of any LC or for any acts or omissions of any beneficiary
thereof. Any action, inaction, error, delay, or omission taken or
suffered by Administrative Agent or any of its representatives under or
in connection with any LC, applicable demands for payment or drawing, or
documents relating thereto, or the transmission, dispatch, or delivery
of any message or advice related thereto, if in good faith and in
conformity with such Laws as Administrative Agent or any of its
representatives may deem applicable and in accordance with the standards
of care specified in the Uniform Customs and Practice for Documentary
Credits issued by the International Chamber of Commerce, as in effect on
the date of issue of such LC, shall be binding upon the Borrower and its
Subsidiaries and Lenders and shall not place Administrative Agent or any
of its representatives under any resulting liability to Borrower or any
of its Subsidiaries or any Lender.
(g) Cash Collateral. On the Termination Date, or on any date that
the LC Exposure exceeds the then-effective Commitment under the LC
Subfacility, or upon any demand by Administrative Agent upon the
occurrence and during continuance of an Event of Default, Borrower shall
provide to Administrative Agent, for the benefit of Lenders, (i) cash
collateral in an amount equal to 100% of the LC Exposure existing on
such date, such cash and all interest thereon shall constitute cash
collateral for all LCs, and (ii) such additional cash collateral as
Administrative Agent may from time to time require, so that the cash
collateral amount shall at all times equal or exceed 100% the LC
Exposure. Any cash collateral deposited under this CLAUSE (g), and all
interest earned thereon, shall be held by Administrative Agent and
invested and reinvested at the expense and the written direction of
Borrower, in U.S. Treasury Bills with maturities of no more than 90 days
from the date of investment.
(h) INDEMNIFICATION. BORROWER SHALL PROTECT, INDEMNIFY, PAY, AND
SAVE ADMINISTRATIVE AGENT AND EACH LENDER HARMLESS FROM AND AGAINST ANY
AND ALL CLAIMS, DEMANDS, LIABILITIES, DAMAGES, OR LOSSES OF, OR OWED TO
THIRD PARTIES
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(INCLUDING ANY OF THE FOREGOING ARISING FROM THE NEGLIGENCE OF
ADMINISTRATIVE AGENT, LENDERS, OR THEIR RESPECTIVE REPRESENTATIVES), AND
ANY AND ALL RELATED COSTS, CHARGES, AND EXPENSES(INCLUDING REASONABLE
ATTORNEYS' FEES, INCLUDING ALLOCATED COSTS OF INTERNAL COUNSEL), WHICH
ADMINISTRATIVE AGENT, OR ANY LENDER MAY INCUR OR BE SUBJECT TO AS A
CONSEQUENCE, DIRECT OR INDIRECT, OF(A) THE ISSUANCE OF ANY LC, OR(B) THE
FAILURE OF ADMINISTRATIVE AGENT TO HONOR A DRAFT UNDER SUCH LC AS A
RESULT OF ANY ACT OR OMISSION, WHETHER RIGHTFUL OR WRONGFUL, OF ANY
PRESENT OR FUTURE GOVERNMENTAL AUTHORITY; PROVIDED THAT, BORROWER SHALL
HAVE NO LIABILITY TO INDEMNIFY ADMINISTRATIVE AGENT OR ANY LENDER IN
RESPECT OF ANY LIABILITY ARISING OUT OF THE GROSS NEGLIGENCE OR WILFUL
MISCONDUCT OF SUCH PARTY OR ANY REPRESENTATIVES OF SUCH PARTY. THE
PROVISIONS OF AND UNDERTAKINGS AND INDEMNIFICATIONS SET FORTH IN THIS
SECTION 2.3(h) SHALL SURVIVE THE SATISFACTION AND PAYMENT OF THE
OBLIGATION AND TERMINATION OF THIS AGREEMENT.
(i) LC Agreements. Although referenced in any LC, terms of any
particular agreement or other obligation to the beneficiary are not in
any manner incorporated herein. The fees and other amounts payable with
respect to each LC shall be as provided in this Agreement, drafts under
any LC shall be deemed part of the Obligations, and in the event of any
conflict between the terms of this Agreement and any LC Agreement, the
terms of this Agreement shall be controlling.
2.4 BORROWING PROCEDURES. The following procedures apply to all Loans
(except Swing Line Loans):
(a) Requesting Loans. Borrower shall give Administrative Agent
notice pursuant to a Notice of Borrowing or telephonic notice of each
borrowing of Revolving Loans. Each Notice of Borrowing shall be
delivered to Administrative Agent before 12:00 noon (a) in the case of
Eurodollar Loans, on the date two Business Days prior to the proposed
date of such borrowing and (b) in the case of Base Rate Loans, on the
proposed date of such borrowing. Any such telephonic notice shall
include all information to be specified in a written Notice of Borrowing
and shall be promptly confirmed in writing by Borrower pursuant to a
Notice of Borrowing sent to Administrative Agent by telecopy on the same
day of the giving of such telephonic notice. Administrative Agent will
transmit by telecopy the Notice of Borrowing (or the information
contained in such Notice of Borrowing) to each Lender promptly upon
receipt by Administrative Agent (but in any event not later than 1:00
p.m. on the date of receipt thereof). Each Notice of Borrowing or
telephonic notice of each borrowing shall be irrevocable once given and
binding on Borrower.
(b) Disbursements of Loan Proceeds. No later than 3:00 p.m. on
the date specified in the Notice of Borrowing, each Lender will make
available for the account of its applicable Lending Office to
Administrative Agent at the Principal Office, in immediately available
funds, the proceeds of the Revolving Loan to be made by such Lender.
With respect to Revolving Loans to be made after the Effective Date,
unless Administrative Agent shall have been notified by any Lender prior
to the specified date of borrowing that such Lender does not intend to
make available to Administrative Agent the Revolving Loan to be made by
such Lender on such date, Administrative Agent may assume that such
Lender will make the proceeds of such Revolving Loan available to
Administrative Agent on the date of the requested borrowing as set forth
in the Notice of Borrowing and Administrative Agent may (but shall not
be obligated to), in reliance upon such assumption, make available to
Borrower the amount of such Revolving Loan to be provided by such
Lender.
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Subject to satisfaction of the applicable conditions set forth in
SECTION 5 for such borrowing, Administrative Agent will make the
proceeds of such borrowing available to Borrower no later than 4:00 p.m.
on the date and at the account specified by Borrower in such Notice of
Borrowing.
2.5 RATES AND PAYMENT OF INTEREST ON LOANS.
(a) Rates. Borrower promises to pay to Administrative Agent for
the account of each Lender, interest on the unpaid principal amount of
each Revolving Loan for the period from and including the date of the
making of such Revolving Loan to but excluding the date such Revolving
Loan shall be paid in full, at the following per annum rates:
(i) during such periods as such Revolving Loan is a Base
Rate Loan, the lesser of (A) the Base Rate (as in effect from
time to time) and (B) the Maximum Rate; and
(ii) during such periods as such Revolving Loan is a
Eurodollar Loan, the lesser of (A) the sum of the Adjusted
Eurodollar Rate for such Revolving Loan for the Interest Period
therefor, plus 1.25% and (B) the Maximum Rate.
Notwithstanding the foregoing, (i) during the continuance of an Event of
Default, and prior to maturity or acceleration of the Obligations,
Borrower hereby promises to pay to Administrative Agent for account of
each Lender interest at 2% per annum in excess of the rates otherwise
payable hereunder on the aggregate outstanding principal of all
Revolving Loans made by such Lender and on any other amount payable by
Borrower hereunder or under the Note held by such Lender (including
without limitation, the Swing Principal Debt, and overdue accrued but
unpaid interest to the extent permitted under Applicable Law), and (ii)
upon the maturity or acceleration of the Obligations in accordance with
the terms hereof, Borrower promises to pay to Administrative Agent for
the account of each Lender interest at the Post-Default Rate on such
amounts.
(b) Payment of Interest. Accrued interest on each Revolving Loan
shall be payable as provided in each of the following clauses which
apply to such Revolving Loan: (i) in the case of a Base Rate Loan,
monthly on the last Business Day of each calendar month, (ii) in the
case of a Eurodollar Loan, on the last day of each Interest Period
therefor; provided that, with respect to Eurodollar Loans having an
Interest Period in excess of three months, then accrued interest shall
also be due and payable at the end of each three-month period occurring
after the commencement of such Interest Period until such Eurodollar
Rate borrowing is paid or converted, (iii) in the case of a Eurodollar
Loan, upon the payment, prepayment or Continuation thereof or the
Conversion of such Loan to a Loan of another Type (but only on the
principal amount so paid, prepaid, Continued, or Converted), and (iv) in
the case of any Base Rate Loan, upon the payment or prepayment thereof
in full. Interest payable during the continuance of an Event of Default
but prior to maturity or acceleration of the Obligations shall be
payable in accordance with the immediately preceding sentence. Interest
payable at the Post-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, Administrative Agent shall give notice
thereof to the Lenders to which such interest is payable and to
Borrower. All determinations by Administrative Agent of an interest rate
hereunder shall be conclusive and binding on the Lenders and Borrower
for all purposes, absent manifest error.
2.6 NUMBER OF INTEREST PERIODS. There may be no more than ten different
Interest Periods for Eurodollar Loans outstanding at the same time.
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2.7 REPAYMENT OF LOANS. Borrower shall repay the entire outstanding
Principal Debt and all accrued but unpaid interest thereon on the Termination
Date.
2.8 PREPAYMENTS.
(a) Optional. Subject to SECTION 4.5, Borrower may prepay any
Loan made to it at any time without premium or penalty.
(b) Mandatory.
(i) If at any time the Commitment Usage exceeds the
aggregate amount of the Commitments of the Lenders in effect at
such time, or the Swing Principal Debt exceeds the Swing Line
Commitment, then Borrower shall immediately pay to Administrative
Agent for the respective accounts of the appropriate Lenders the
amount of such excess; provided that, on any such date that a
mandatory prepayment is due under this SECTION 2.8(B)(I), if no
Principal Debt is then outstanding, but the LC Exposure exceeds
the aggregate Commitments of the Lenders then in effect, then
Borrower shall provide to Administrative Agent (for itself and
for the benefit of Lenders holding participations in the LC
Subfacility) cash collateral in an amount at least equal to 100%
of such excess.
(ii) If (A) as a result of any asset disposition by
Borrower or any of its Subsidiaries, Borrower or any such
Subsidiary is required to redeem or prepay (or to offer to redeem
or prepay) any Debt (other than the Obligations) by a particular
date (the "SUBJECT DATE") in an amount equal to all or a portion
of the net cash proceeds received by such entity from such asset
disposition (the "ASSET DISPOSITION PROCEEDS"), and (B) such
obligations to redeem or prepay (or to offer to redeem or prepay)
such other Debt may be avoided by prepayment of the Obligations
in an amount equal to such Asset Disposition Proceeds on or prior
to the Subject Date, then not less than 30 days prior to the
Subject Date, Borrower shall pay to Administrative Agent (for the
ratable benefit of Lenders) a mandatory prepayment of the
Obligations (and the Commitment shall be concurrently reduced) in
an amount equal to such Asset Disposition Proceeds.
If Borrower is required to pay any outstanding Eurodollar Loans by
reason of this Section prior to the end of the applicable Interest
Period therefor, then Borrower shall pay all amounts due under SECTION
4.5.
2.9 CONTINUATION. So long as no Default or Event of Default shall have
occurred and be continuing, Borrower may on any Business Day, with respect to
any Eurodollar Loan, elect to maintain such Eurodollar Loan or any portion
thereof as a Eurodollar Loan, as applicable, by selecting a new Interest Period
for such Loan. Each new Interest Period selected under this Section shall
commence on the last day of the immediately preceding Interest Period. Each
selection of a new Interest Period shall be made by Borrower giving to
Administrative Agent a Notice of Continuation not later than 12:00 noon on the
second Business Day prior to the date of any such Continuation. Such notice by
Borrower of a Continuation shall be by telephone or telecopy, confirmed
immediately in writing if by telephone, in the form of a Notice of Continuation,
specifying (a) the proposed date of such Continuation, (b) the Eurodollar Loan,
and portion thereof subject to such Continuation and (c) the duration of the
selected Interest Period, all of which shall
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be specified in such manner as is necessary to comply with all limitations on
Loans outstanding hereunder. Each Notice of Continuation shall be irrevocable by
and binding on Borrower once given. Promptly after receipt of a Notice of
Continuation (and in any event not later than 1:00 p.m. on the date of receipt
thereof), Administrative Agent shall notify each Lender by telex or telecopy, or
other similar form of transmission of the proposed Continuation. If Borrower
shall fail to select in a timely manner a new Interest Period for any Eurodollar
Loan in accordance with this Section, such Loan will automatically, on the last
day of the current Interest Period therefor, Convert into a Base Rate Loan.
2.10 CONVERSION. Borrower may on any Business Day, upon Borrower's
giving of a Notice of Conversion to Administrative Agent, Convert all or a
portion of a Revolving Loan of one Type into a Revolving Loan of another Type.
Any Conversion of a Eurodollar Loan into a Base Rate Loan shall be made on, and
only on, the last day of an Interest Period for such Eurodollar Loan. Each such
Notice of Conversion shall be given by Borrower not later than 12:00 noon (a) on
the Business Day prior to the date of any proposed Conversion into Base Rate
Loans or (b) on the second Business Day prior to the date of any proposed
Conversion into Eurodollar Loans. Promptly upon receipt of a Notice of
Conversion (and in any event not later than 1:00 p.m. on the date of receipt
thereof), Administrative Agent shall notify each Lender by telecopy or other
similar form of transmission of the proposed Conversion. Subject to the
restrictions specified above, each Notice of Conversion shall be by telephone or
telecopy confirmed immediately in writing if by telephone, in the form of a
Notice of Conversion, specifying (1) the requested date of such Conversion, (2)
the Type of Revolving Loan to be Converted, (3) the portion of such Type of
Revolving Loan to be Converted, (4) the Type of Revolving Loan into which such
Revolving Loan is to be Converted, and (5) if such Conversion is into a
Eurodollar Loan, the requested duration of the Interest Period of such Revolving
Loan. Each Notice of Conversion shall be irrevocable by and binding on Borrower
once given. Notwithstanding the foregoing, the right to convert from a Base Rate
Loan to a Eurodollar Loan, or to continue a Eurodollar Loan, shall not be
available during the occurrence of a Default or an Event of Default.
2.11 NOTES.
(a) Revolving Note. The Revolving Loans (other than Swing Line
Loans) made by each Lender shall, in addition to this Agreement, also be
evidenced by a promissory note of Borrower substantially in the form of
EXHIBIT E-1 (each a "REVOLVING NOTE"), payable to the order of such
Lender. The Revolving Note issued by Borrower to each Lender shall be in
a principal amount equal to the amount of such Lender's Commitment as
originally in effect.
(b) Swing Line Note. The Swing Line Loans made by Bank of
America pursuant to SECTION 2.2, in addition to this Agreement, shall be
evidenced by a promissory note of Borrower substantially in the form of
EXHIBIT E-2 (the "SWING LINE NOTE") hereto. The Swing Line Note issued
by Borrower to Bank of America shall be in a principal amount equal to
the Swing Line Commitment, as originally in effect.
(c) Records; Endorsement on Transfer. The date, amount, interest
rate, Type, and duration of Interest Periods (if applicable) of each
Loan made by each Lender, and each payment made on account of the
principal thereof, shall be recorded by such Lender on its books and
such entries shall be prima facie evidence of such matters. Prior to the
transfer of any Note, the Lender shall endorse such items on such Note
or any allonge thereof; provided that, the failure of such Lender to
make any such recordation or endorsement shall not affect the
obligations of Borrower to make a payment when due of any amount owing
hereunder or under such Note in respect of the Loans evidenced by such
Note.
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2.12 REDUCTIONS OF THE COMMITMENT. Borrower shall have the right to
terminate or reduce the aggregate unused amount of the Commitments of the
Lenders (other than the portion of the Commitments applicable to Swing Line
Loans or issued and outstanding LCs) at any time and from time to time without
penalty or premium upon not less than five Business Days prior written notice to
Administrative Agent of each such termination or reduction, which notice shall
specify the effective date thereof and the amount of any such reduction and
shall be irrevocable once given and effective only upon receipt by
Administrative Agent. Administrative Agent will promptly transmit such notice to
each Lender. The Swing Line Commitment and the Commitment under the LC
Subfacility (as the case may be) shall be automatically and permanently reduced
from time to time, on the date of each reduction in the Commitments of the
Lenders, by the amount, if any, by which the applicable Subfacility exceeds the
aggregate Commitments of the Lenders then in effect, after giving effect to such
reduction of the Commitments. The Commitments, once terminated or reduced, may
not be increased or reinstated.
2.13 INCREASES OF COMMITMENTS. Borrower may from time to time request
any one or more Lenders to increase their respective Commitments or request
other financial institutions first approved by Administrative Agent to agree to
a Commitment, so that the total Commitments may be increased to no more than
$500,000,000. That increase must be effected by an amendment that is executed in
accordance with SECTION 12.5 by Borrower, Administrative Agent, and the one or
more Lenders who have agreed to increase their Commitments or by new Lenders who
have agreed to new Commitments in accordance with SECTION 12.5. In the event the
total Commitments are increased, Borrower shall execute and deliver to each
Lender extending such additional Commitment a Revolving Note in the stated
amount of its new or increased Commitment. No Lender is obligated to increase
its Commitment under any circumstances, and no Lender's Commitment may be
increased except by its execution of an amendment to this Agreement in
accordance with SECTION 12.5. Each new Lender providing such additional
Commitment shall be a "Lender" hereunder, entitled to the rights and benefits,
and subject to the duties, of a Lender under the Loan Documents. In such case,
each Lender's Commitment Percentage shall be recalculated to reflect the new
proportionate share of the revised total Commitments and the Lender responsible
for the additional Commitments (the "PURCHASING LENDER") shall, immediately upon
receiving notice from Administrative Agent, pay to each Lender an amount equal
to its pro rata share of the Revolving Loans (and any funded participations by
Lenders under the Swing Line Subfacility and the LC Subfacility) outstanding as
of such date. All such payments with respect to the Revolving Loans shall reduce
the outstanding principal balance of the Revolving Note of each Lender receiving
such payments and shall represent Revolving Loans to Borrower under the
purchasing Lender's Revolving Note; all such payments with respect to funded
participations under the Swing Line Subfacility or LC Subfacility (as the case
may be) shall reduce the applicable participation of each Lender receiving such
payment and shall represent the purchase by the purchasing Lender of a
participation under the Swing Line Subfacility or the LC Subfacility (as the
case may be). The purchasing Lender shall be entitled to share ratably in
interest accruing on the balances purchased, at the rates provided herein for
such balances, from and after the date of purchase. All new Revolving Loans
occurring after an increase of the total Commitments shall be funded in
accordance with the Lender's revised Commitment Percentages.
2.14 OPTIONAL RENEWAL OF COMMITMENTS.
(a) Optional Renewal Procedures. Borrower may request that the
Termination Date be extended for all or a portion of the Commitment to a
date which is no later than one year after the then-current Termination
Date; provided that, (i) any such extension request shall be made in
writing (an "EXTENSION REQUEST") by Borrower and delivered to
Administrative Agent no more than 90 days
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prior to (but no later than 45 days prior to) the then-current Termination Date;
and (ii) no more than one such Extension Request may be made by Borrower.
Promptly upon receipt of an Extension Request, Administrative Agent shall notify
the Lenders of such request.
(i) Lenders' Response to Extension Request. The Lenders
may, at their option, accept or reject such Extension Request by
giving written notice to Administrative Agent delivered no
earlier than 60 days prior to (but no later than 15 days prior
to) the then-effective Termination Date (the date that is 15 days
prior to the then effective Termination Date being the "RESPONSE
DATE"). If any Lender shall fail to give such notice to
Administrative Agent by the Response Date, such Lender shall be
deemed to have rejected the requested extension. If the Extension
Request is not consented to by Requisite Lenders by the Response
Date, the Extension Request will be rejected, and this Agreement
will terminate on the Termination Date. If the Requisite Lenders
consent to the Extension Request by the Response Date, the
Termination Date for those Lenders consenting to the extension
(for purposes of this SECTION 2.14(a), the "ACCEPTING LENDERS")
shall be automatically extended to the date which is one year
after the then-current Termination Date.
(ii) Additional Procedures to Extend the Rejected Amount.
If the Extension Request is consented to by Requisite Lenders,
but fewer than all Lenders (any Lender not consenting to the
Extension Request being referred to in this SECTION 2.14(a) as
a "REJECTING LENDER"), then Administrative Agent shall, within 48
hours of making such determination, notify the Accepting Lenders
and Borrower of the aggregate Commitments held by the Rejecting
Lenders (as used in this SECTION 2.14(a), the "REJECTED AMOUNT").
Each Accepting Lender shall have the right, but not the
obligation, to elect to increase its respective Commitment by an
amount not to exceed the Rejected Amount, which election shall be
made by notice from each Accepting Lender to the Administrative
Agent given not later than ten days after the date notified by
Administrative Agent, specifying the amount of such proposed
increase in such Accepting Lender's Commitment. If the aggregate
amount of the proposed increases in the Commitment of all
Accepting Lenders making such an election does not equal or
exceed the Rejected Amount, then Borrower shall have the right to
add one or more financial institutions (which are not Rejecting
Lenders and which are Eligible Assignees) as Lenders (as used in
this SECTION 2.14(a), a "PURCHASING LENDER") to replace such
Rejecting Lenders, which Purchasing Lenders shall have aggregate
Commitments not greater than those of the Rejecting Lenders (less
any increases in the Commitment of Accepting Lenders, as
described in the following CLAUSE (iii)). The transfer of
Commitments and outstanding Loans from Rejecting Lenders to
Purchasing Lenders or Accepting Lenders shall take place on the
effective date of, and pursuant to the execution, delivery, and
acceptance of, an Assignment and Acceptance Agreement in
accordance with the procedures set forth in SECTION 12.4.
(iii) Adjustments to, and Terminations of, Commitments.
(A) If less than 100% (but at least 66 b%) of the
Commitments is extended (whether by virtue of Borrower's
failure to request an extension of the full Commitments or
by virtue of any Lender not consenting to any Extension
Request), then the Commitments shall automatically be
reduced on the Termination Date on which the applicable
approved extension is effective by an amount equal to (as
the case may be) (i) the portion of the Commitments not
requested to be extended by
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Borrower in its Extension Request or (ii) the amount of
the Rejected Amount (to the extent not replaced by
Accepting Lenders or Purchasing Lenders pursuant to the
procedures set forth in the foregoing SECTION
2.14(a)(ii)). Each Rejecting Lender shall have no
further obligation or Commitment following the
Termination Date on which the applicable approved
extension is effective, other than any obligation
accruing prior to such date as provided herein.
(B) If the aggregate amount of the proposed
increases in the Commitments of all Accepting Lenders
making an election to increase their respective
Commitments is in excess of the Rejected Amount, then
(i) the Rejected Amount shall be allocated pro rata
among such Accepting Lenders based on the respective
amounts of the proposed increases to Commitments elected
by such Accepting Lenders; and (ii) the respective
Commitments of each such Accepting Lender shall be
increased by the respective amount allocated pursuant to
CLAUSE (i) of this SECTION 2.14(a)(iii)(B), such that,
after giving effect to the approved extensions and all
such terminations and increases, no reduction will occur
in the aggregate amount of the Commitments.
(C) If the aggregate amount of the proposed
increases to the Commitments of all Accepting Lenders
making such an election to so increase their respective
Commitments equals the Rejected Amount, then the
respective Commitments of such Accepting Lenders shall
be increased by the respective amounts of their proposed
increases, such that, after giving effect to the
approved extensions and all such terminations and
increases, no reduction will occur in the aggregate
amount of the Commitments.
(D) If the aggregate amount of the proposed
increases to the Commitments of all Accepting Lenders
making such an election is less than the Rejected
Amount, then (i) the respective Commitments of each such
Accepting Lender shall be increased by the respective
amount of its proposed increase; and (ii) the amount of
the Commitments shall be reduced by the amount of the
Rejected Amount (to the extent not replaced by the
Accepting Lenders or the Purchasing Lenders, if any).
(b) No Obligation to Renew. Borrower acknowledges that (i)
neither Administrative Agent nor any Lender has made any representations
to Borrower regarding its intent to agree to any extensions set forth in
this Section, (ii) neither Administrative Agent nor any Lender shall
have any obligation to extend the Commitments (or any portion thereof),
and (iii) Administrative Agent's and Lenders' agreement to one or more
extensions shall not commit Administrative Agent or the Lenders to any
additional extensions.
SECTION 3 PAYMENTS, FEES AND OTHER GENERAL PROVISIONS.
3.1 PAYMENTS. Each payment or prepayment on the Obligations shall be
made in Dollars, without deduction, setoff, or counterclaim, and is due and must
be paid at Administrative Agent's Principal Office in Dallas, Texas in funds
which are or will be available for immediate use by Administrative Agent by
12:00 noon on the day due. Payments made after 12:00 noon shall be deemed made
on the Business Day next following. If no Default or Event of Default exists and
if no order of application is otherwise specified
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in the Loan Documents, payments and prepayments of the Obligations shall be
applied first to Fees, second to accrued interest then due and payable on the
Principal Debt, and then to the remaining Obligations in the order and manner as
Borrower may direct. If a Default or Event of Default exists (or if Borrower
fails to give direction as permitted in the preceding sentence), any payment or
prepayment shall be applied to the Obligations in accordance with SECTION 10.4.
Administrative Agent shall pay to each Lender any payment or prepayment to which
such Lender is entitled hereunder on the same day Administrative Agent shall
have received the same from Borrower; provided such payment or prepayment is
received by Administrative Agent prior to 12:00 noon, and otherwise before 12:00
noon on the Business Day next following. If and to the extent Administrative
Agent shall not make such payments to the Lenders when due as set forth in the
preceding sentence, such unpaid amounts shall accrue interest, payable by
Administrative Agent, at the Federal Funds Rate from the due date until (but not
including) the date on which Administrative Agent makes such payments to the
Lenders.
3.2 PRO RATA TREATMENT. Except to the extent otherwise provided herein:
(a) each borrowing from the Lenders under SECTION 2.1 shall be made from the
Lenders, each payment of the Fees under SECTION 3.8(a) and 3.8(d)(i) shall be
made for account of the Lenders, and each termination or reduction of the amount
of the Commitments under SECTION 2.12 shall be applied to the respective
Commitments of the Lenders, pro rata according to the amounts of their
respective Commitment Percentages; (b) each payment or prepayment of principal
of Revolving Loans shall be made for account of the Lenders pro rata in
accordance with the respective unpaid principal amounts of the Revolving Loans
held by them; provided that, if immediately prior to giving effect to any such
payment in respect of any Revolving Loans the outstanding principal amount of
the Revolving Loans shall not be held by the Lenders pro rata in accordance with
their respective Commitment Percentages in effect at the time such Revolving
Loans were made, then such payment shall be applied to the Revolving Loans in
such manner as shall result, as nearly as is practicable, in the outstanding
principal amount of the Revolving Loans being held by the Lenders pro rata in
accordance with their respective Commitment Percentages; (c) each payment of
interest on Revolving Loans shall be made for account of the Lenders pro rata in
accordance with the amounts of interest on such Revolving Loans then due and
payable to the respective Lenders; (d) each payment of principal or interest
under the Swing Line Subfacility shall be made for the account of Bank of
America and each other Lender purchasing a participation in the Swing Line
Subfacility and shall be shared pro rata among such Lenders, as determined on
any date of determination for any such Lender as the proportion which the Swing
Principal Debt (or participations therein) owed to such Lender bears to the
Swing Principal Debt owed to all Lenders; (e) each payment with respect to the
LC Subfacility shall be made for the account of Bank of America and each other
Lender purchasing a participation in any LC and related reimbursement
obligations and shall be shared pro rata among such Lenders, as determined on
any date of determination for any such Lender as the proportion which the
Principal Debt arising under the LC Subfacility (or participations therein) owed
to such Lender bears to the Principal Debt under the LC Subfacility owed to all
Lenders; and (f) the making, Conversion, and Continuation of Revolving Loans of
a particular Type (other than Conversions provided for by SECTION 4.4) shall be
made pro rata among the Lenders according to the amounts of their respective
Commitment Percentages (in the case of making of Revolving Loans) or their
respective Revolving Loans (in the case of Conversions and Continuations of
Revolving Loans) and the then current Interest Period for each Lender's portion
of each Revolving Loan of such Type shall be coterminous.
3.3 SHARING OF PAYMENTS, ETC. If any Lender shall obtain any payment
(whether voluntary, involuntary, or otherwise, including, without limitation, as
a result of exercising its rights under SECTION 3.4) which is in excess of its
ratable share of any such payment, such Lender shall purchase from the other
Lenders such participations as shall be necessary to cause such purchasing
Lender to share the excess
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payment ratably with each of them; provided, however, that if all or any portion
of such excess payment is thereafter recovered from such purchasing Lender, the
purchase shall be rescinded and the purchase price restored to the extent of
such recovery. Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section may, to the fullest extent
permitted by Applicable Law, exercise all of its rights of payment (including
the right of offset) with respect to such participation as fully as if such
Lender were the direct creditor of Borrower in the amount of such participation.
3.4 OFFSET. Upon the occurrence and during the continuance of an Event
of Default, each Lender shall be entitled to exercise (for the benefit of the
Lenders in accordance with SECTION 3.3) the rights of offset and/or banker's
lien against each and every account and other property, or any interest therein,
which any Borrower may now or hereafter have with, or which is now or hereafter
in the possession of, such Lender to the extent of the full amount of the
Obligations.
3.5 BOOKING BORROWINGS. To the extent permitted by Applicable Law, any
Lender may make, carry, or transfer its Loans at, to, or for the account of any
of its branch offices or the office of any of its Affiliates; provided that, no
Affiliate shall be entitled to receive any greater payment under SECTION 4 than
the transferor Lender would have been entitled to receive with respect to such
Loans.
3.6 SEVERAL OBLIGATIONS. No Lender shall be responsible for the failure
of any other Lender to make a Loan or to perform any other obligation to be made
or performed by such other Lender hereunder, and the failure of any Lender to
make a Loan or to perform any other obligation to be made or performed by it
hereunder shall not relieve the obligation of any other Lender to make any Loan
or to perform any other obligation to be made or performed by such other Lender.
3.7 MINIMUM AMOUNTS.
(a) Borrowings and Conversions. Each borrowing of Base Rate Loans
shall be in an aggregate minimum amount of $1,000,000 and integral
multiples of $1,000,000 in excess thereof. Each borrowing of Eurodollar
Loans, and each Conversion of Loans to Eurodollar Loans shall be in an
aggregate minimum amount of $1,000,000 and integral multiples of
$1,000,000 in excess of that amount.
(b) Prepayments. Each voluntary prepayment of Loans shall be in
an aggregate minimum amount of $1,000,000.
(c) Reductions of Commitments. Each reduction of the Commitments
under SECTION 2.12 shall be in an aggregate minimum amount of $5,000,000
and integral multiples of $1,000,000 in excess thereof.
3.8 FEES.
(a) Facility Fee. Borrower agrees to pay to Administrative Agent
for the account of the Lenders a facility fee in an amount equal to
0.25% multiplied by the amount of the average daily Commitment (whether
used or unused), in each case during the period from and including the
last payment date (or in respect of the initial payment, the Effective
Date) to and excluding the payment date for such installment. Such
facility fee shall be payable quarterly in arrears on each Quarterly
Date and on the Termination Date, beginning with June 30, 2000.
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(b) Upfront Fee. Borrower agrees to pay an upfront fee to
Administrative Agent for the account of Lenders in the amount stated
next to such Lender's name on the attached SCHEDULE 2.
(c) Administrative and Other Fees. Borrower agrees to pay the
administrative and other fees of Administrative Agent set forth in that
certain separate letter agreement dated May 1, 2000 among Borrower,
Administrative Agent, and Arranger.
(d) LC Fees. As an inducement for the issuance (including,
without limitation, any extension) of each LC, Borrower agrees to pay to
Administrative Agent:
(i) For the account of each Lender, according to each
Lender's Commitment Percentage under the Revolving Facility on
the day the fee is payable, an issuance fee payable quarterly in
arrears for so long as each such LC is outstanding, on the last
Business Day of each March, June, September, and December and on
the expiry date of the LC. The issuance fee for each LC or any
extension thereof shall be in an amount equal to the product of
(a) 1.25% (calculated on a per annum basis) multiplied by (b) the
average daily undrawn amount of such LC.
(ii) For the account of Administrative Agent, as the
issuer of LCs, payable on the date of issuance of any LC (or any
extension thereof), a fronting fee of 0.125% of the face amount
of such LC (or extensions thereof). In addition, Borrower shall
pay to Administrative Agent, for its individual account, standard
administrative charges for LC amendments.
3.9 COMPUTATIONS. Unless otherwise expressly set forth herein, any
accrued interest on any Base Rate Loan due hereunder shall be computed on the
basis of a 365/366 day year, and in all other instances, any accrued interest on
any Eurodollar Loan, any Fees or other Obligations due hereunder shall be
computed on the basis of a year of 360 days and the actual number of days
elapsed.
3.10 MAXIMUM RATE. Regardless of any provision contained in any Loan
Document, neither Administrative Agent nor any Lender shall ever be entitled to
contract for, charge, take, reserve, receive, or apply, as interest on the
Obligations, or any part thereof, any amount in excess of the Maximum Rate, and,
if the Lenders ever do so, then such excess shall be deemed a partial prepayment
of principal and treated hereunder as such and any remaining excess shall be
refunded to Borrower. In determining if the interest paid or payable exceeds the
Maximum Rate, Borrower and the Lenders shall, to the maximum extent permitted
under applicable Law, (a) treat all Loans as but a single extension of credit
(and Lenders and Borrower agree that such is the case and that provision herein
for multiple Loans is for convenience only), (b) characterize any nonprincipal
payment as an expense, fee, or premium rather than as interest, (c) exclude
voluntary prepayments and the effects thereof, and (d) amortize, prorate,
allocate, and spread the total amount of interest throughout the entire
contemplated term of the Obligations; provided that, if the Obligations are paid
and performed in full prior to the end of the full contemplated term thereof,
and if the interest received for the actual period of existence thereof exceeds
the Maximum Amount, the Lenders shall refund such excess, and, in such event,
the Lenders shall not, to the extent permitted by Applicable Law, be subject to
any penalties provided by any Applicable Laws for contracting for, charging,
taking, reserving, or receiving interest in excess of the Maximum Amount.
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3.11 INTEREST RECAPTURE. If the designated rate applicable to any Loan
exceeds the Maximum Rate, the rate of interest on such Loan shall be limited to
the Maximum Rate, but any subsequent reductions in such designated rate shall
not reduce the rate of interest thereon below the Maximum Rate until the total
amount of interest accrued thereon equals the amount of interest which would
have accrued thereon if such designated rate had at all times been in effect. In
the event that at maturity (stated or by acceleration), or at final payment of
the Principal Debt, the total amount of interest paid or accrued is less than
the amount of interest which would have accrued if such designated rates had at
all times been in effect, then, at such time and to the extent permitted by law,
Borrower shall pay an amount equal to the difference between (a) the lesser of
the amount of interest which would have accrued if such designated rates had at
all times been in effect and the amount of interest which would have accrued if
the Maximum Rate had at all times been in effect, and (b) the amount of interest
actually paid or accrued on the Principal Debt.
3.12 AGREEMENT REGARDING INTEREST AND CHARGES. The parties hereto hereby
agree and stipulate that the only charge imposed upon Borrower for the use of
money in connection with this Agreement is and shall be the interest
specifically described in SECTION 2.5(a). Notwithstanding the foregoing, the
parties hereto further agree and stipulate that all agency fees, syndication
fees, facility fees, underwriting fees, default charges, late charges, funding
or "breakage" charges, increased cost charges, attorneys' fees and reimbursement
for costs and expenses paid by Administrative Agent or any Lender to third
parties or for damages incurred by Administrative Agent or any Lender, are
charges made to compensate Administrative Agent or any such Lender for
underwriting or administrative services and costs or losses performed or
incurred, and to be performed or incurred, by Administrative Agent and the
Lenders in connection with this Agreement and shall under no circumstances be
deemed to be charges for the use of money.
3.13 DEFAULTING LENDERS.
(a) Generally. If for any reason any Lender (a "DEFAULTING
LENDER") shall fail or refuse to perform any of its obligations under
this Agreement or any other Loan Document to which it is a party within
the time period specified for performance of such obligation or, if no
time period is specified, if such failure or refusal continues for a
period of two Business Days after notice from Administrative Agent,
then, in addition to the rights and remedies that may be available to
Administrative Agent or Borrower under this Agreement or Applicable Law,
such Defaulting Lender's right to participate in the administration of
the Loans, this Agreement, and the other Loan Documents, including
without limitation, any right to vote in respect of, to consent to, or
to direct any action or inaction of Administrative Agent or to be taken
into account in the calculation of the Requisite Lenders, shall be
suspended during the pendency of such failure or refusal. If a Lender is
a Defaulting Lender because it has failed to make timely payment to
Administrative Agent of any amount required to be paid to Administrative
Agent hereunder (without giving effect to any notice or cure periods),
in addition to other rights and remedies which Administrative Agent or
Borrower may have under the immediately preceding provisions or
otherwise, Administrative Agent shall be entitled (i) to collect
interest from such Defaulting Lender on such delinquent payment for the
period from the date on which the payment was due until the date on
which the payment is made at the Federal Funds Rate, and (ii) to
withhold or setoff and to apply in satisfaction of the defaulted payment
and any related interest, any amounts otherwise payable to such
Defaulting Lender under this Agreement or any other Loan Document. Any
amounts received by Administrative Agent in respect of a Defaulting
Lender's Loans shall not be paid to such Defaulting Lender and shall be
held uninvested by Administrative Agent and either applied against the
purchase price of such Loans under the following SUBSECTION (b) or paid
to such Defaulting Lender upon the Defaulting Lender's
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curing of its default. Borrower shall not have any liability in respect
of such action by Administrative Agent.
(b) Purchase of Defaulting Lender's Commitment. Any Lender who is
not a Defaulting Lender shall have the right, but not the obligation, in
its sole discretion, to acquire all of a Defaulting Lender's Commitment.
Any Lender desiring to exercise such right shall give written notice
thereof to Administrative Agent no sooner than two Business Days and not
later than ten Business Days after such Defaulting Lender became a
Defaulting Lender. If more than one Lender exercises such right, each
such Lender shall have the right to acquire an amount of such Defaulting
Lender's Commitment in proportion to the Commitments of the other
Lenders exercising such right. Upon any such purchase, the Defaulting
Lender's interest in the Revolving Loans and any funded participations
under the Swing Line Subfacility and the LC Subfacility and its rights
hereunder (but not its liability in respect thereof or under the Loan
Documents or this Agreement to the extent the same relate to the period
prior to the effective date of the purchase) shall terminate on the date
of purchase, and the Defaulting Lender shall promptly execute all
documents reasonably requested to surrender and transfer such interest
to the purchaser thereof including an appropriate Assignment and
Acceptance Agreement and, notwithstanding SECTION 12.4(a), shall pay to
Administrative Agent an assignment fee in the amount of $3,500. The
purchase price for the Commitment of a Defaulting Lender shall be equal
to the amount of the principal balance of the Revolving Loans (together
with the principal amount of any funded participations in any Swing Line
Loans held by the Defaulting Lender pursuant to SECTION 2.2(b) and any
funded participations under the LC Subfacility held by the Defaulting
Lender pursuant to SECTION 2.3(b)) outstanding and owed by Borrower to
the Defaulting Lender. Prior to payment of such purchase price to a
Defaulting Lender, Administrative Agent shall apply against such
purchase price any amounts retained by Administrative Agent pursuant to
the second to last sentence of the immediately preceding SUBSECTION (a).
The Defaulting Lender shall be entitled to receive amounts owed to it by
Borrower under the Loan Documents which accrued prior to the date of the
default by the Defaulting Lender, to the extent the same are received by
Administrative Agent from or on behalf of Borrower. There shall be no
recourse against any Lender or Administrative Agent for the payment of
such sums except to the extent of the receipt of payments from any other
party or in respect of the Revolving Loans or the principal amount of
any funded participations in any Swing Line Loan or in any LC and
related reimbursement obligations under the LC Subfacility. If, prior to
a Lender's acquisition of a Defaulting Lender's Commitment pursuant to
this subsection, such Defaulting Lender shall cure the event or
condition which caused it to become a Defaulting Lender and shall have
paid all amounts owing by it hereunder as a result thereof, then such
Lender shall no longer have the right to acquire such Defaulting
Lender's Commitment.
SECTION 4 YIELD PROTECTION, ETC.
4.1 INCREASED COST AND REDUCED RETURN.
(a) If, after the date hereof, the adoption of any Applicable
Law, rule, or regulation, or any change in any Applicable Law, or any
change in the interpretation or administration thereof by any
Governmental Authority, or compliance by any Lender (or its applicable
Lending Office) with any request or directive (whether or not having the
force of law) of any such Governmental Authority:
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(i) shall subject such Lender (or its applicable Lending
Office) to any tax, duty, or other charge with respect to any
Eurodollar Loans, its Note, or its obligation to make Eurodollar
Loans, or change the basis of taxation of any amounts payable to
such Lender (or its applicable Lending Office) under the Loan
Documents in respect of any Eurodollar Loans (other than taxes
imposed on the overall net income of such Lender by the
jurisdiction in which such Lender has its principal office or
such applicable Lending Office);
(ii) shall impose, modify, or deem applicable any
reserve, special deposit, assessment, or similar requirement
(other than the Reserve Requirement utilized in the
determination of the Adjusted Eurodollar Rate) relating to any
extensions of credit or other assets of, or any deposits with or
other liabilities or commitments of, such Lender (or its
applicable Lending Office), including the Commitment of such
Lender hereunder; or
(iii) shall impose on such Lender (or its applicable
Lending Office) or on the London interbank market any other
condition affecting the Loan Documents or any of such extensions
of credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such
Lender (or its applicable Lending Office) of making, Converting into,
Continuing, or maintaining any Eurodollar Loans or to reduce any sum
received or receivable by such Lender (or its applicable Lending Office)
under the Loan Documents with respect to any Eurodollar Loans, then
Borrower shall pay to such Lender on demand such amount or amounts as
will compensate such Lender for such increased cost or reduction. If any
Lender requests compensation by Borrower under this SECTION 4.1(a),
Borrower may, by notice to such Lender (with a copy to Administrative
Agent), suspend the obligation of such Lender to make or Continue
Revolving Loans of the Type with respect to which such compensation is
requested, or to Convert Revolving Loans of any other Type into
Revolving Loans of such Type, until the event or condition giving rise
to such request ceases to be in effect (in which case the provisions of
SECTION 4.4 shall be applicable); provided that such suspension shall
not affect the right of such Lender to receive the compensation so
requested.
(b) If, after the date hereof, any Lender shall have determined
that the adoption of any Applicable Law, regarding capital adequacy or
any change therein or in the interpretation or administration thereof by
any Governmental Authority charged with the interpretation or
administration thereof, or any request or directive regarding capital
adequacy (whether or not having the force of law) of any such
Governmental Authority (excluding those of the foregoing applying to a
Lender solely by reason of a formal determination by the applicable
regulator that such Lender is in a financially troubled condition) has
or would have the effect of reducing the rate of return on the capital
of such Lender or any corporation controlling such Lender as a
consequence of such Lender's obligations hereunder to a level below that
which such Lender or such corporation could have achieved but for such
adoption, change, request, or directive (taking into consideration its
policies with respect to capital adequacy), then from time to time upon
demand Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender for such reduction.
(c) Each Lender shall promptly notify Borrower and Administrative
Agent of any event of which it has knowledge, occurring after the date
hereof, which will entitle such Lender to compensation pursuant to this
Section and will designate a different applicable Lending Office if
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such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the judgment of such Lender, be otherwise
disadvantageous to it. Any Lender claiming compensation under this Section shall
furnish to Borrower and Administrative Agent a statement setting forth the
additional amount or amounts to be paid to it hereunder which shall be
conclusive in the absence of manifest error. In determining such amount, such
Lender may use any reasonable averaging and attribution methods.
4.2 LIMITATION ON TYPES OF LOANS. If on or prior to the first day of any
Interest Period for any Eurodollar Loan:
(a) Administrative Agent determines (which determination shall be
conclusive) that by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate for such Interest Period; or
(b) the Requisite Lenders determine (which determination shall be
conclusive) and notify Administrative Agent that the Adjusted Eurodollar
Rate will not adequately and fairly reflect the cost to the Lenders of
funding Eurodollar Loans for such Interest Period; then Administrative
Agent shall give Borrower prompt notice thereof specifying the relevant
Revolving Loans and the relevant amounts or periods, and so long as such
condition remains in effect, the Lenders shall be under no obligation to
make additional Eurodollar Loans, Continue Eurodollar Loans, or to
Convert Base Rate Loans into Eurodollar Loans, and Borrower shall, on
the last day(s) of the then current Interest Period(s) for the
outstanding Eurodollar Loans, either prepay such Loans or Convert such
Loans into Base Rate Loans in accordance with the terms of this
Agreement.
4.3 ILLEGALITY. Notwithstanding any other provision of this Agreement,
in the event that it becomes unlawful for any Lender or its applicable Lending
Office to make, maintain, or fund Eurodollar Loans hereunder, then such Lender
shall promptly notify Borrower thereof and such Lender's obligation to make or
Continue Eurodollar Loans and to Convert other Base Rate Loans into Eurodollar
Loans shall be suspended until such time as such Lender may again make,
maintain, and fund Eurodollar Loans (in which case the provisions of SECTION 4.4
shall be applicable).
4.4 TREATMENT OF AFFECTED LOANS. If the obligation of any Lender to make
a Eurodollar Loan or to Continue, or to Convert Base Rate Loans into Eurodollar
Loans shall be suspended pursuant to SECTION 4.1,4.2, or 4.3 hereof, such
Lender's Eurodollar Loans shall be automatically Converted into Base Rate Loans
on the last day(s) of the then current Interest Period(s) for Eurodollar Loans
(or, in the case of a Conversion required by SECTION 4.3 hereof, on such earlier
date as such Lender may specify to Borrower with a copy to Administrative Agent)
and, unless and until such Lender gives notice as provided below that the
circumstances specified in SECTION 4.1, 4.2, or 4.3 hereof that gave rise to
such Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans have been
so Converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Eurodollar Loans shall be applied
instead to its Base Rate Loans; and
(b) all Loans that would otherwise be made or Continued by such
Lender as Eurodollar Loans shall be made or Continued instead as Base
Rate Loans, and all Loans of such Lender that
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would otherwise be Converted into Eurodollar Loans shall be Converted
instead into (or shall remain as) Base Rate Loans.
If such Lender gives notice to Borrower (with a copy to Administrative Agent)
that the circumstances specified in SECTION 4.1, 4.2, or 4.3 hereof that gave
rise to the Conversion of such Lender's Eurodollar Loans pursuant to this
SECTION 4.4 no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when Eurodollar Loans made by other
Lenders are outstanding, such Lender's Base Rate Loans shall be automatically
Converted, on the first day(s) of the next succeeding Interest Period(s) for
such outstanding Eurodollar Loans, to the extent necessary so that, after giving
effect thereto, all Revolving Loans held by the Lenders holding Eurodollar Loans
and by such Lender are held pro rata (as to principal amounts, Types, and
Interest Periods) in accordance with their respective Commitments.
4.5 COMPENSATION. Upon the request of any Lender, Borrower shall pay to
such Lender such amount or amounts as shall be sufficient (in the reasonable
opinion of such Lender) to compensate it for any loss, cost, or expense
(including loss of anticipated profits) incurred by it as a result of:
(a) any payment, prepayment (including, without limitation, any
principal reduction effected pursuant to SECTION 2.13 as a result of an
increase in the Commitment), or Conversion of a Eurodollar Loan for any
reason (including, without limitation, the acceleration of the Revolving
Loans pursuant to SECTION 10.2) on a date other than the last day of the
Interest Period for such Loan; or
(b) any failure by Borrower for any reason (including, without
limitation, the failure of any condition precedent specified in SECTION
5 to be satisfied) to borrow, Convert, Continue, or prepay a Eurodollar
Loan on the date for such borrowing, Conversion, Continuation, or
prepayment specified in the relevant notice of borrowing, prepayment,
Continuation, or Conversion under this Agreement.
4.6 TAXES.
(a) Any and all payments by Borrower to or for the account of any
Lender or Administrative Agent hereunder or under any other Loan
Document shall be made free and clear of and without deduction for any
and all present or future taxes, duties, levies, imposts, deductions,
charges, or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and Administrative Agent,
taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction under the laws of which such Lender (or its applicable
Lending Office) or Administrative Agent (as the case may be) is
organized or any political subdivision thereof (all such non-excluded
taxes, duties, levies, imposts, deductions, charges, withholdings, and
liabilities being hereinafter referred to as "TAXES"). If Borrower shall
be required by law to deduct any Taxes from or in respect of any sum
payable under this Agreement or any other Loan Document to any Lender or
Administrative Agent, (i) the sum payable shall be increased as
necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this SECTION 4.6)
such Lender or Administrative Agent receives an amount equal to the sum
it would have received had no such deductions been made, (ii) Borrower
shall make such deductions, (iii) Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in
accordance with Applicable Law, and (iv) Borrower shall furnish to
Administrative Agent, at its
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address referred to in SECTION 12.1, the original or a certified copy of
a receipt evidencing payment thereof.
(b) In addition, Borrower agrees to pay any and all present or
future stamp or documentary taxes and any other excise or property taxes
or charges or similar levies which arise from any payment made under
this Agreement or any other Loan Document or from the execution or
delivery of, or otherwise with respect to, this Agreement or any other
Loan Document (hereinafter referred to as "OTHER TAXES").
(c) Borrower agrees to indemnify each Lender and Administrative
Agent for the full amount of Taxes and Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this SECTION 4.6) paid by such
Lender or Administrative Agent (as the case may be) and any liability
(including penalties, interest, and expenses) arising therefrom or with
respect thereto.
(d) Each Lender organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and
delivery of this Agreement in the case of each Lender listed on the
signature pages hereof and on or prior to the date on which it becomes a
Lender in the case of each other Lender, and from time to time
thereafter if requested in writing by Borrower or Administrative Agent
(but only so long as such Lender remains lawfully able to do so), shall
provide Borrower and Administrative Agent with (i) Internal Revenue
Service Form 1001 or 4224, as appropriate, or any successor form
prescribed by the Internal Revenue Service, certifying that such Lender
is entitled to benefits under an income tax treaty to which the United
States is a party which reduces the rate of withholding tax on payments
of interest or certifying that the income receivable pursuant to this
Agreement is effectively connected with the conduct of a trade or
business in the United States, (ii) Internal Revenue Service Form W-8
or W-9, as appropriate, or any successor form prescribed by the Internal
Revenue Service, and (iii) any other form or certificate required by any
taxing authority (including any certificate required by Sections 871(h)
and 881(c) of the Internal Revenue Code), certifying that such Lender is
entitled to an exemption from or a reduced rate of tax on payments
pursuant to this Agreement or any of the other Loan Documents.
(e) For any period with respect to which a Lender has failed to
provide Borrower and Administrative Agent with the appropriate form
pursuant to SECTION 4.6(D)(unless such failure is due to a change in
treaty, law, or regulation occurring subsequent to the date on which a
form originally was required to be provided), such Lender shall not be
entitled to indemnification under SECTION 4.6(a) or 4.6(b) with respect
to Taxes imposed by the United States; provided, however, that should a
Lender, which is otherwise exempt from or subject to a reduced rate of
withholding tax, become subject to Taxes because of its failure to
deliver a form required hereunder, Borrower shall take such steps as
such Lender shall reasonably request to assist such Lender to recover
such Taxes.
(f) If Borrower is required to pay additional amounts to or for
the account of any Lender pursuant to this SECTION 4.6, then such Lender
will agree to use reasonable efforts to change the jurisdiction of its
applicable Lending Office so as to eliminate or reduce any such
additional payment which may thereafter accrue if such change, in the
judgment of such Lender, is not otherwise disadvantageous to such
Lender.
(g) Within 30 days after the date of any payment of Taxes,
Borrower shall furnish to Administrative Agent the original or a
certified copy of a receipt evidencing such payment.
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(h) Without prejudice to the survival of any other agreement
of Borrower hereunder, the agreements and obligations of Borrower
contained in this SECTION 4.6 shall survive the termination of the
Commitments and the payment in full of the Notes.
4.7 REMOVAL OF LENDERS. If (a) a Lender or a Participant requests
compensation pursuant to SECTIONS 4.1 or 4.6 and the Requisite Lenders are not
also doing the same, or (b) the obligation of a Lender to make Eurodollar Loans
or to Continue, or to Convert Loans into Eurodollar Loans shall be suspended
pursuant to SECTION 4.1 or SECTION 4.3, but the obligation of the Requisite
Lenders shall not have been suspended under such Sections, Borrower may either
(A) demand that such Lender or Participant (the "AFFECTED LENDER"), and upon
such demand the Affected Lender shall promptly, assign its Commitment and all of
its Loans to an Eligible Assignee subject to and in accordance with the
provisions of SECTION 12.4 for a purchase price equal to the aggregate principal
balance of Loans then owing to the Affected Lender (together with any
participation held by the affected Lender in any Swing Line Loan pursuant to
SECTION 2.2(b) or in any LC and related reimbursement obligations under the LC
Subfacility pursuant to SECTION 2.3(b)) plus any accrued but unpaid interest
thereon, accrued but unpaid Fees owing to the Affected Lender, and any amounts
owing the Affected Lender under SECTION 4, or (B) pay to the Affected Lender the
aggregate principal balance of Loans (together with any participation held by
the Affected Lender in any Swing Line Loan pursuant to SECTION 2.2(b) or in any
LC and related reimbursement obligations under the LC Subfacility pursuant
to SECTION 2.3(b)) then owing to the Affected Lender plus any accrued but unpaid
interest thereon, accrued but unpaid Fees owing to the Affected Lender, and any
amounts owing the Affected Lender under SECTION 4, whereupon the Affected Lender
shall no longer be a party hereto or have any rights or obligations hereunder or
under any of the other Loan Documents, subject to the survival of certain
provisions as set forth in SECTION 12.9. Each of Administrative Agent and the
Affected Lender shall reasonably cooperate in effectuating the replacement of an
Affected Lender under this Section, but at no time shall Administrative Agent,
the Affected Lender, or any other Lender be obligated in any way whatsoever to
initiate any such replacement or to assist in finding an Eligible Assignee. The
exercise by Borrower of its rights under this Section shall be at Borrower's
sole cost and expenses and at no cost or expense to Administrative Agent, the
Affected Lender, or any of the other Lenders. The terms of this Section shall
not in any way limit Borrower's obligation to pay to any Affected Lender
compensation owing to such Affected Lender pursuant to SECTION 4.
SECTION 5 CONDITIONS PRECEDENT.
5.1 INITIAL CONDITIONS PRECEDENT. The obligation of the Lenders to
effect the occurrence of the first Credit Event hereunder is subject to the
following conditions precedent:
(a) Administrative Agent shall have received each of the
following, in form and substance satisfactory to the Lenders:
(i) Counterparts of this Agreement executed by each
of the parties hereto;
(ii) Notes executed by Borrower, payable to each
Lender and complying with the terms of SECTIONS 2.11(a)
and 2.11(b);
(iii) Copies (certified by the Secretary or Assistant
Secretary of Borrower) of the Articles of Incorporation and
Bylaws of Borrower;
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(iv) An opinion of ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP,
counsel to Borrower, addressed to Administrative Agent and the
Lenders, in substantially the form of EXHIBIT F;
(v) A certificate of incumbency signed by the
Secretary or Assistant Secretary of Borrower with respect to
each of the officers of Borrower authorized to execute and
deliver the Loan Documents and the officers of Borrower then
authorized to deliver Notices of Borrowing, LC Requests,
Notices of Continuation, and Notices of Conversion;
(vi) Copies (certified by the Secretary or Assistant
Secretary of Borrower) of all corporate action taken by
Borrower to authorize the execution, delivery, and performance
of the Loan Documents;
(vii) A copy of each of the documents, instruments,
and agreements evidencing any of the Indebtedness described
on SCHEDULE 6.1(g) and a copy of each Material Contract
described on SCHEDULE 6.1(h), certified as true, correct, and
complete by the chief financial officer of Borrower;
(viii) The Fees then due under SECTION 3.8;
(ix) A Compliance Certificate calculated as of March
31, 2000;
(x) Payment by Borrower of all outstanding
Indebtedness owed to any Non-Continuing Lender under the
Existing Agreement, together with a payoff letter in form and
substance reasonably acceptable to Administrative Agent.
(xi) Repayment of all accrued and unpaid interest
under the Existing Agreement and repayment of all unpaid fees
and other amounts payable under the Existing Agreement.
(xii) Such other documents, agreements and
instruments as Administrative Agent on behalf of the Lenders
may reasonably request.
(b) In the good faith judgment of Administrative Agent and the
Lenders:
(i) There shall not have occurred or become known to
Administrative Agent or the Lenders, from and including
December 31, 1999, any event, condition, situation, or status
since the date of the information contained in the financial
and business projections, budgets, pro forma data and
forecasts concerning Borrower and its Subsidiaries delivered
to Administrative Agent and the Lenders prior to the Agreement
Date that has had or could reasonably be expected to result in
a Material Adverse Effect;
(ii) No litigation, action, suit, investigation, or
other arbitral, administrative, or judicial proceeding shall
be pending or threatened which could reasonably be expected to
(A) result in a Material Adverse Effect or (B) restrain or
enjoin, impose materially burdensome conditions on, or
otherwise materially and adversely affect the ability of
Borrower to fulfill its obligations under the Loan Documents;
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(iii) Borrower and its Subsidiaries shall have
received all approvals, consents, and waivers, and shall have
made or given all necessary filings and notices as shall be
required to consummate the transactions contemplated hereby
without the occurrence of any default under, conflict with, or
violation of (A) any Applicable Law or (B) any agreement,
document, or instrument to which Borrower or any Subsidiary is
a party or by which any of them or their respective properties
is bound, except for such approvals, consents, waivers,
filings and notices the receipt, making, or giving of which
would not reasonably be likely to (1) have a Material Adverse
Effect, or (2) restrain or enjoin, impose materially
burdensome conditions on, or otherwise materially and
adversely affect the ability of Borrower to fulfill its
obligations under the Loan Documents; and
(iv) There shall not have occurred or exist any other
material disruption of financial or capital markets that could
reasonably be expected to materially and adversely affect the
transactions contemplated by the Loan Documents.
5.2 CONDITIONS PRECEDENT TO ALL LOANS OR LC ISSUANCES. The obligation
of the Lenders to make any Loans or the obligation of the Administrative Agent
to issue any LC is subject to the further conditions precedent that: (a) no
Default or Event of Default shall have occurred and be continuing as of the date
of the making of such Loan or would exist immediately after giving effect
thereto; (b) the representations and warranties made or deemed made by Borrower
and its Subsidiaries in the Loan Documents to which any of them is a party,
shall be true and correct on and as of the date of the making of such Loan with
the same force and effect as if made on and as of such date except to the extent
that such representations and warranties expressly relate solely to an earlier
date (in which case such representations and warranties shall have been true and
accurate on and as of such earlier date) and except for changes in factual
circumstances specifically and expressly permitted hereunder; (c) in the case of
the borrowing of Loans (other than Swing Line Loans), Administrative Agent shall
have received a timely Notice of Borrowing; and (d) in the case of the issuance
of an LC, Administrative Agent shall have timely received an LC Request
(together with the applicable LC Agreement) and the Fees provided for in SECTION
3.8(d). Each Credit Event shall constitute a certification by Borrower to the
effect set forth in the preceding sentence (both as of the date of the giving of
notice relating to such Credit Event and, unless Borrower otherwise notifies
Administrative Agent prior to the date of such Credit Event, as of the date of
the occurrence of such Credit Event). In addition, if such Credit Event is the
making of a Loan or the issuance of an LC, Borrower shall be deemed to have
represented to Administrative Agent and the Lenders at the time such Loan is
made or LC is issued that all conditions to the making of such Loan or the
issuance of such LC contained in SECTION 5 have been satisfied. Each condition
precedent in this Agreement is material to the transactions contemplated in this
Agreement, and time is of the essence in respect of each thereof. Subject to the
prior approval of Requisite Lenders, the Lenders may fund any Loan or
Administrative Agent may issue any LC without all conditions being satisfied,
but, to the extent permitted by Applicable Law, the same shall not be deemed to
be a waiver of the requirement that each such condition precedent be satisfied
as a prerequisite for any subsequent funding or issuance, unless Requisite
Lenders specifically waive each such item in writing.
SECTION 6 REPRESENTATIONS AND WARRANTIES.
6.1 REPRESENTATIONS AND WARRANTIES. In order to induce Administrative
Agent and each Lender to enter into this Agreement and to make Loans and to
issue LCs, Borrower represents and warrants to Administrative Agent and each
Lender as follows:
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(a) Organization; Power; Qualification. Except as disclosed
on SCHEDULE 6.1(a), each of Borrower and its Subsidiaries is a
corporation, partnership, or other legal entity, duly organized or
formed, validly existing and in good standing under the jurisdiction of
its incorporation or formation, has the power and authority to own or
lease its respective properties and to carry on its respective business
as now being and hereafter proposed to be conducted, and is duly
qualified and is in good standing as a foreign corporation,
partnership, or other legal entity, and authorized to do business, in
each jurisdiction in which the character of its properties or the
nature of its business requires such qualification or authorization and
where the failure to be so qualified or authorized would have, in each
instance, a Material Adverse Effect.
(b) Ownership Structure. As of the Agreement Date, SCHEDULE
6.1(b) correctly sets forth the corporate structure and ownership
interests of the Subsidiaries including the correct legal name of each
Subsidiary, its jurisdiction of formation, the Persons holding equity
interests in such Subsidiary, and their percentage equity or voting
interest in such Subsidiary. As of the Agreement Date, SBLC, SBIC,
REIT, Allied Capital Funding LLC, and Allied Capital CMT Inc. are the
only Material Subsidiaries. Except as set forth in such Schedule, and
except for Permitted Preferred Stock:
(i) No Consolidated Subsidiary has issued to any
third party any securities convertible into such Consolidated
Subsidiary's capital stock or other equity interests or any
options, warrants, or other rights to acquire any securities
convertible into such capital stock or other equity interests,
and
(ii) The outstanding capital stock of, or other
equity interests in, each Consolidated Subsidiary are owned by
Borrower and its Consolidated Subsidiaries indicated on such
Schedule free and clear of all Liens, warrants, options and
rights of others of any kind whatsoever. All such outstanding
capital stock and other equity interests have been validly
issued and, in the case of capital stock, are fully paid and
nonassessable.
(c) Authorization of Agreement, Notes, Loan Documents, and
Borrowings. Borrower has the right and power, and has taken all
necessary action to authorize it, to borrow hereunder or to request the
issuance of an LC and to incur reimbursement obligations with respect
thereto. Borrower has the right and power, and has taken all necessary
action to authorize it to execute, deliver, and perform each of the
Loan Documents to which it is a party in accordance with their
respective terms and to consummate the transactions contemplated hereby
and thereby. The Loan Documents have been duly executed and delivered
by the duly authorized officers of Borrower, and each is a legal,
valid, and binding obligation of Borrower, enforceable against it in
accordance with its respective terms.
(d) Compliance of Agreement, Notes, Loan Documents, and
Borrowing with Laws, etc. The execution, delivery and performance of
this Agreement, the Notes, and the other Loan Documents in accordance
with their respective terms, and the borrowings hereunder do not and
will not, by the passage of time, the giving of notice, or otherwise:
(i) require any Governmental Approval, other than such as have been
obtained and are in full force and effect, or violate any Applicable
Law (including all Environmental Laws) relating to Borrower or any
Subsidiary; (ii) conflict with, result in a breach of, or constitute a
default under the articles of incorporation or the bylaws of Borrower
or the organizational documents of any Subsidiary, or any indenture,
agreement, or other instrument to which Borrower or any Subsidiary is a
party or by which it or any
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of its respective properties may be bound; or (iii) result in or
require the creation or imposition of any Lien upon or with respect to
any property now owned or hereafter acquired by Borrower or any
Subsidiary.
(e) Compliance with Law; Governmental Approvals. Borrower and
each Subsidiary is in compliance with each Governmental Approval
applicable to it and in compliance with all other Applicable Law
relating to it, except for noncompliances which, and Governmental
Approvals the failure to possess which, would not, individually or in
the aggregate, cause a Default or Event of Default or have a Material
Adverse Effect.
(f) Ownership of Assets; Liens. Each of Borrower and its
Consolidated Subsidiaries has good title to all of its assets. There
are no Liens against any of such assets except for Liens permitted
by SECTION 9.3.
(g) Indebtedness. SCHEDULE 6.1(g) is, as of the Effective
Date, a complete and correct listing of all Indebtedness of Borrower
and its Subsidiaries, including all guaranties of Borrower and its
Subsidiaries and all letters of credit and acceptance facilities
extended to Borrower or any Subsidiary.
(h) Material Contracts. SCHEDULE 6.1(h) is a true, correct,
and complete listing of all Material Contracts as of the Effective
Date.
(i) Litigation. There are no actions, suits, or proceedings
pending (nor, to the knowledge of Borrower or any Subsidiary, are there
any actions, suits, or proceedings threatened, nor is there any basis
therefor) against or in any other way relating adversely to or
affecting Borrower or any Subsidiary or any of its respective property
in any court or before any arbitrator of any kind or before or by any
other Governmental Authority which is reasonably likely to be adversely
determined and result in a Material Adverse Effect, and there are no
strikes, slow downs, work stoppages or walkouts or other labor disputes
in progress or threatened relating to Borrower or any Subsidiary.
(j) Taxes. All federal, state, and other tax returns of
Borrower and its Consolidated Subsidiaries required by Applicable Law
to be filed have been duly filed, and all federal, state, and other
taxes, assessments and other governmental charges or levies upon
Borrower and any of its Consolidated Subsidiaries and their respective
properties, income, profits, and assets which are due and payable have
been paid, except any such nonpayment which is at the time permitted
under SECTION 7.6. None of the United States income tax returns of
Borrower and its Consolidated Subsidiaries are under audit as of the
Agreement Date. All charges, accruals, and reserves on the books of
Borrower and each of its Consolidated Subsidiaries in respect of any
taxes or other governmental charges are in accordance with GAAP.
(k) Financial Statements: No Material Adverse Change. Borrower
has furnished to each Lender copies of (i) the audited consolidated
balance sheets of Borrower and its Consolidated Subsidiaries for the
fiscal year ending December 31, 1999, and the related consolidated
statements of operations, changes in net assets, and cash flows for the
fiscal year ending on such date, with the opinion thereon of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, LLP, and (ii) the unaudited consolidated balance sheets of
Borrower and its Consolidated Subsidiaries for the one-fiscal quarter
period ending March 31, 2000, and the related consolidated statements
of operations, changes in net assets, and cash flows for the
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one-fiscal quarter period ending on such date. Such balance sheets and
statements (including in each case related schedules and notes) present
fairly, in accordance with GAAP consistently applied throughout the
periods involved, the consolidated financial position of Borrower as at
their respective dates and the results of operations, changes in net
assets, and cash flows for such periods (subject, as to interim
statements, to changes resulting from normal year-end audit
adjustments). Neither Borrower nor any of its Consolidated Subsidiaries
has on the Agreement Date any material contingent liabilities, other
liabilities, liabilities for taxes, unusual or long-term commitments or
unrealized or forward anticipated losses from any unfavorable
commitments, except as referred to or reflected or provided for in said
financial statements. Since December 31, 1999, there has been no
material adverse change in the consolidated financial condition,
results of operations, business or prospects of Borrower and its
Consolidated Subsidiaries taken as a whole. Each of Borrower and its
Consolidated Subsidiaries is Solvent.
(l) ERISA. Each member of the ERISA Group has fulfilled its
obligations under the minimum funding standards of ERISA and the
Internal Revenue Code with respect to each Plan and is in compliance
with the presently applicable provisions of ERISA and the Internal
Revenue Code with respect to each Plan except for noncompliances which
would not, individually or in the aggregate, cause a Default or an
Event of Default or have a Material Adverse Effect. No member of the
ERISA Group has (i) sought a waiver of the minimum funding standard
under Section 412 of the Internal Revenue Code in respect of any Plan,
(ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or made
any amendment to any Plan or Benefit Arrangement, which has resulted or
could result in the imposition of a Lien or the posting of a bond or
other security under ERISA or the Internal Revenue Code, or (iii)
incurred any liability under Title IV of ERISA, other than a liability
to the PBGC for premiums under Section 4007 of ERISA.
(m) Absence of Defaults. Neither Borrower nor any Material
Subsidiary is in default under its articles of incorporation, bylaws,
partnership agreement, or other similar organizational documents, and
no event has occurred, which has not been remedied, cured or waived:
(i) which constitutes a Default or an Event of Default; or (ii) which
constitutes, or which with the passage of time, the giving of notice, a
determination of materiality, the satisfaction of any condition, or any
combination of the foregoing, would constitute, a default or event of
default by Borrower or any Subsidiary under any Indebtedness, Material
Contract, any other agreement (other than this Agreement) or judgment,
decree, or order to which Borrower or any Subsidiary is a party or by
which Borrower or any Subsidiary or any of their respective properties
may be bound where such default or event of default could, individually
or in the aggregate, have a Material Adverse Effect.
(n) Environmental Laws. Borrower and its Subsidiaries have
obtained all Governmental Approvals which are required under
Environmental Laws, and are in compliance with all terms and conditions
of such Governmental Approvals, which the failure to obtain or to
comply with could reasonably be expected to have a Material Adverse
Effect. Each of Borrower and its Subsidiaries is also in compliance
with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules, and timetables
contained in the Environmental Laws the failure with which to comply
could have a Material Adverse Effect. Neither Borrower nor any
Subsidiary is aware of, or has received notice of, any past, present,
or future events, conditions, circumstances, activities, practices,
incidents, actions, or plans which, with respect to Borrower or any of
its Subsidiaries may interfere with or prevent compliance or continued
compliance with Environmental Laws, or may give rise to any common-law
or legal liability, or otherwise form the basis of any
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claim, action, demand, suit, proceeding, hearing, study, or
investigation, based on or related to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling
or the emission, discharge, release, or threatened release into the
environment, of any pollutant, contaminant, chemical, or industrial,
toxic, or other Hazardous Materials that could be reasonably expected
to have a Material Adverse Effect; and there is no civil, criminal, or
administrative action, suit, demand, claim, hearing, notice, or demand
letter, notice of violation, investigation, or proceeding pending or,
to the knowledge of Borrower or any Subsidiary, after due inquiry,
threatened, against Borrower or any of its Subsidiaries relating in any
way to Environmental Laws that could be reasonably expected to have a
Material Adverse Effect.
(o) Investment Company; Public Utility Holding Company.
Borrower is a "business development company" within the meaning of the
Investment Company Act. Neither Borrower nor any Subsidiary is (i) a
"holding company" or a "subsidiary company" of a "holding company," or
an "affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company," within the meaning of the Public Utility Holding
Company Act of 1935, as amended, or (ii) except for other Subsidiaries
that are business development companies, subject to any other
Applicable Law which purports to regulate or restrict its ability to
borrow money or to consummate the transactions contemplated by this
Agreement or to perform its obligations under any Loan Document to
which it is a party.
(p) Margin Stock. Neither Borrower nor any Subsidiary 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" within
the meaning of Regulation U (as enacted by the Board of Governors of
the Federal Reserve System, as amended). "Margin Stock" (as defined in
Regulation U) constitutes less than 25% of those assets of Borrower or
any Subsidiary which are subject to any limitation on sale, pledge, or
other restrictions hereunder.
(q) Affiliate Transactions. Except as permitted by SECTION
9.8, neither Borrower nor any Subsidiary is a party to or bound by any
agreement or arrangement (whether oral or written) to which any
Affiliate of Borrower or any Subsidiary is a party. Neither Borrower
nor any Subsidiary is a party to any agreement or arrangement which
restricts or prohibits the payment of dividends or the repayment of
inter-company loans by a Subsidiary to Borrower, except for SBA
approval of dividends paid by SBIC, which Borrower has no reason to
believe will not be granted by the SBA.
(r) Intellectual Property. Borrower and each Subsidiary owns
or has the right to use, under valid license agreements or otherwise,
all patents, licenses, franchises, trademarks, trademark rights, trade
names, trade name rights, trade secrets, and copyrights (COLLECTIVELY,
"INTELLECTUAL PROPERTY") used in the conduct of its businesses as now
conducted and as contemplated by the Loan Documents, which the failure
to own or have the right to use could reasonably be expected to have a
Material Adverse Effect, without known conflict with any patent,
license, franchise, trademark, trade secret, trade name, copyright, or
other proprietary right of any other Person.
(s) Accuracy and Completeness of Information. All written
information, reports, and other papers and data furnished to
Administrative Agent or any Lender by, on behalf of, or at the
direction of, Borrower or any Subsidiary were, at the time the same
were so furnished, complete and correct in all material respects, to
the extent necessary to give the recipient a true and accurate
knowledge of the subject matter, or, in the case of financial
statements, present fairly, in accordance with GAAP consistently
applied throughout the periods involved, the financial position of the
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Persons involved as at the date thereof and the results of operations
for such periods. As of the Agreement Date, no fact is known to
Borrower or any Subsidiary which has had, or may in the future have (so
far as Borrower or any Subsidiary can reasonably foresee), a Material
Adverse Effect which has not been set forth in the financial statements
referred to in SECTION 6.1(k) or in such information, reports or other
papers or data or otherwise disclosed in writing to Administrative
Agent and the Lenders prior to the Effective Date. No document
furnished or written statement made to Administrative Agent or any
Lender in connection with the negotiation, preparation, or execution of
this Agreement or any of the other Loan Documents contains or will
contain any untrue statement of a fact material to the creditworthiness
of Borrower or any Subsidiary or omits or will omit to state a material
fact necessary in order to make the statements contained therein not
misleading. Notwithstanding the first and third sentences of this
SECTION 6.1(s), as to projected financial information, Borrower
represents and warrants only that such information, at the time
furnished to Administrative Agent or any Lender, was prepared in good
faith based on reasonable assumptions under the circumstances.
(t) RIC Status. Each of Borrower, SBLC, and SBIC qualifies as
a RIC.
(u) Not Plan Assets. The assets of Borrower or any Subsidiary
do not and will not constitute "plan assets," within the meaning of
ERISA, the Internal Revenue Code and the respective regulations
promulgated thereunder. The execution, delivery and performance of this
Agreement, and the borrowing and repayment of amounts hereunder, do not
and will not constitute "prohibited transactions" under ERISA or the
Internal Revenue Code.
(v) Business. As of the Agreement Date, Borrower and its
Subsidiaries are substantially engaged in the businesses described in
the Offering Memorandum.
6.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC. All statements
contained in any certificate, financial statement, or other instrument delivered
by or on behalf of Borrower or any Subsidiary to Administrative Agent or any
Lender pursuant to or in connection with this Agreement or any of the other Loan
Documents (including, but not limited to, any such statement made in or in
connection with any amendment thereto or any statement contained in any
certificate, financial statement, or other instrument delivered by or on behalf
of Borrower prior to the Agreement Date and delivered to Administrative Agent or
any Lender in connection with closing the transactions contemplated hereby)
shall constitute representations and warranties made by Borrower under this
Agreement. All representations and warranties made under this Agreement and the
other Loan Documents shall be deemed to be made at and as of the Agreement Date,
the Effective Date, and at and as of the date of the occurrence of any Credit
Event, except to the extent that such representations and warranties expressly
relate solely to an earlier date (in which case such representations and
warranties shall have been true and accurate on and as of such earlier date) and
except for changes in factual circumstances specifically permitted hereunder.
All such representations and warranties shall survive the effectiveness of this
Agreement, the execution and delivery of the Loan Documents, and the making of
the Loans.
SECTION 7 AFFIRMATIVE COVENANTS.
For so long as this Agreement is in effect and thereafter until the
payment in full of the Obligations and the termination or expiration of all LCs,
unless the Requisite Lenders (or, if required pursuant to SECTION 12.5, all of
the Lenders) shall otherwise consent in the manner provided for in SECTION 12.5,
Borrower shall:
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51
7.1 PRESERVATION OF EXISTENCE AND SIMILAR MATTERS. Except as otherwise
permitted under SECTION 9.5, preserve and maintain, and Borrower shall cause
each Material Subsidiary to preserve and maintain, its respective existence,
rights, franchises, licenses, and privileges in the jurisdiction of its
incorporation or formation and qualify and remain qualified and authorized to do
business in each jurisdiction in which the character of its properties or the
nature of its business requires such qualification and authorization and where
the failure to be so authorized and qualified could have a Material Adverse
Effect.
7.2 COMPLIANCE WITH APPLICABLE LAW AND MATERIAL CONTRACTS. Comply, and
Borrower shall cause each Material Subsidiary to comply, with (a) all Applicable
Laws (including, without limitation, ERISA, Environmental Laws, and the
Investment Company Act), including the obtaining of all Governmental Approvals,
the failure with which to comply could have a Material Adverse Effect, and (b)
all terms and conditions of all Material Contracts to which it is a party.
7.3 MAINTENANCE OF PROPERTY. In addition to the requirements of any of
the other Loan Documents, (a) protect and preserve, and Borrower shall cause
each Material Subsidiary to protect and preserve, all of its material
properties, including, but not limited to, all Intellectual Property, and
maintain in good repair, working order, and condition all tangible properties,
ordinary wear and tear excepted, and (b) from time to time make or cause to be
made, and Borrower shall cause each Material Subsidiary to make, all needed and
appropriate repairs, renewals, replacements, and additions to such properties,
so that the business carried on in connection therewith may be properly and
effectively conducted at all times.
7.4 CONDUCT OF BUSINESS. Together with its Subsidiaries, at all times
carry on their business described in the Offering Memorandum.
7.5 INSURANCE. In addition to the requirements of any of the other Loan
Documents, maintain, and Borrower shall cause each Material Subsidiary to
maintain, insurance with financially sound and reputable insurance companies
against such risks and in such amounts as is customarily maintained by Persons
engaged in similar businesses or as may be required by Applicable Law.
7.6 PAYMENT OF TAXES AND CLAIMS. Pay or discharge, and Borrower shall
cause each Material Subsidiary to pay and discharge, when due (a) all taxes,
assessments, and governmental charges or levies imposed upon it or upon its
income or profits or upon any properties belonging to it, and (b) all lawful
claims of materialmen, mechanics, carriers, warehousemen, and landlords for
labor, materials, supplies, and rentals which, if unpaid, might become a Lien on
any properties of such Person; provided, however, that this Section shall not
require the payment or discharge of any such tax, assessment, charge, levy, or
claim which is being contested in good faith by appropriate proceedings which
operate to suspend the collection thereof and for which adequate reserves have
been established on the books of Borrower or such Subsidiary, as applicable, in
accordance with GAAP.
7.7 VISITS AND INSPECTIONS. Permit, and Borrower shall cause each
Material Subsidiary to permit, representatives or agents of Administrative Agent
or any Lender, from time to time, as often as may be reasonably requested and at
the expense of Administrative Agent (unless an Event of Default shall be
continuing in which case the exercise by Administrative Agent of its rights
under this Section shall be at the expense of Borrower), but only during normal
business hours, to: (a) visit and inspect all properties of Borrower and each
Material Subsidiary; (b) inspect and make extracts from their respective books
and records, including, but not limited to, management letters prepared by
independent accountants; and
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(c) discuss with its principal officers and its independent accountants, its
business, assets, liabilities, financial conditions, results of operations, and
business prospects. If requested by Administrative Agent, Borrower shall execute
an authorization letter addressed to its accountants authorizing Administrative
Agent or any Lender to discuss the financial affairs of Borrower and any
Material Subsidiary with its accountants.
7.8 USE OF PROCEEDS. Use the proceeds of Loans to repay existing
Indebtedness owed to any Non-Continuing Lender under the Existing Agreement, to
repay all accrued and unpaid interest and fees under the Existing Agreement, to
pay the fees and expenses related to the amendment and restatment of the
Existing Agreement, and for working capital and general corporate purposes of
Borrower and its Subsidiaries. Borrower shall not, and Borrower shall not permit
any Subsidiary to, use any part of such proceeds to purchase or carry, or to
reduce or retire or refinance any credit incurred to purchase or carry, any
margin stock (within the meaning of Regulations T, U, and X of the Board of
Governors of the Federal Reserve System) or to extend credit to others for the
purpose of purchasing or carrying any such margin stock.
7.9 ENVIRONMENTAL MATTERS. Comply, and Borrower shall cause all of its
Subsidiaries to comply, with all Environmental Laws, the failure with which to
comply could have a Material Adverse Effect. If Borrower or any Subsidiary shall
(a) receive notice that any violation of any Environmental Law may have been
committed or is about to be committed by such Person, (b) receive notice that
any administrative or judicial complaint or order has been filed or is about to
be filed against Borrower or any Subsidiary alleging violations of any
Environmental Law or requiring Borrower or any Subsidiary to take any action in
connection with the release of Hazardous Materials, or (c) receive any notice
from a Governmental Authority or private party alleging that Borrower or any
Subsidiary may be liable or responsible for costs associated with a response to
or cleanup of a release of a Hazardous Materials or any damages caused thereby,
and such notices, individually or in the aggregate, could have a Material
Adverse Effect, Borrower shall provide Administrative Agent with a copy of such
notice within ten days after the receipt thereof by Borrower or any of the
Subsidiaries. Borrower and the Subsidiaries shall promptly take all actions
necessary to prevent the imposition of any Liens on any of their respective
properties arising out of or related to any Environmental Laws.
7.10 BOOKS AND RECORDS. Maintain, and Borrower shall cause each of the
Subsidiaries to maintain, books and records pertaining to its business
operations in such detail, form and scope as is consistent with good business
practice in accordance with GAAP.
7.11 STATUS OF RIC AND BDC. At all times maintain, and cause SBLC and
SBIC to maintain, its status as a RIC under the Internal Revenue Code, and as a
"business development company" under the Investment Company Act.
7.12 ERISA EXEMPTIONS. Not, and Borrower shall not permit any
Subsidiary to, permit any of its respective assets to become or be deemed to be
"plan assets" within the meaning of ERISA, the Internal Revenue Code and the
respective regulations promulgated thereunder.
7.13 FURTHER ASSURANCES. At Borrower's cost and expense, upon the
request of Administrative Agent, duly execute and deliver or cause to be duly
executed and delivered, to Administrative Agent and the Lenders such further
instruments, documents, and certificates, and do and cause to be done such
further acts that may be necessary or advisable in the opinion of Administrative
Agent to carry out more effectively the provisions and purposes of this
Agreement and the other Loan Documents.
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SECTION 8 INFORMATION.
For so long as this Agreement is in effect and thereafter until payment
in full of the Obligations and the termination or expiration of all LCs, unless
the Requisite Lenders (or, if required pursuant to SECTION 12.5, all of the
Lenders) shall otherwise consent in the manner set forth in SECTION 12.5,
Borrower shall furnish to each Lender (or to Administrative Agent if so provided
below) at its Lending Office:
8.1 QUARTERLY FINANCIAL STATEMENTS. As soon as available and in any
event within 45 days after the close of each of the first, second, and third
fiscal quarters of Borrower, the consolidated and consolidating balance sheets
of Borrower and its Consolidated Subsidiaries as at the end of each such period
and the related consolidated and consolidating statements of operations, changes
in net assets, and cash flows of Borrower and its Consolidated Subsidiaries for
each such period, setting forth in each case in comparative form the figures for
the corresponding periods of the previous fiscal year, all of which shall be
certified by the chief financial officer of Borrower, in his or her opinion, to
present fairly, in accordance with GAAP, the consolidated financial position of
Borrower and its Consolidated Subsidiaries as at the date thereof and the
results of operations for such period (subject to normal year-end audit
adjustments).
8.2 YEAR-END STATEMENTS. As soon as available and in any event within
90 days after the end of each fiscal year of Borrower, the consolidated and
consolidating balance sheets of Borrower and its Consolidated Subsidiaries as at
the end of such fiscal year and the related consolidated and consolidating
statements of operations, changes in net assets, and cash flows of Borrower and
its Consolidated Subsidiaries for such fiscal year, setting forth in comparative
form the figures as at the end of and for the previous fiscal year, all of which
shall be certified by (a) the chief financial officer of Borrower, in his or her
opinion, to present fairly, in accordance with GAAP, the financial position of
Borrower and its Consolidated Subsidiaries as at the date thereof and the result
of operations for such period and (b) independent certified public accountants
of recognized national standing acceptable to the Requisite Lenders, whose
opinion shall be unqualified and in scope and substance satisfactory to the
Requisite Lenders and who shall have authorized Borrower to deliver such
financial statements and opinion thereon to Administrative Agent and the Lenders
pursuant to this Agreement.
8.3 COMPLIANCE CERTIFICATE; ASSET REPORTS.
(a) At the time the financial statements are furnished
pursuant to SECTIONS 8.1 and 8.2, a Compliance Certificate: (a) setting
forth in reasonable detail as at the end of such quarterly accounting
period or fiscal year, as the case may be, the calculations required to
establish whether or not Borrower and its Consolidated Subsidiaries
were in compliance with the covenants contained in SECTION 9.1, (b)
stating that, to the best of his or her knowledge, information, and
belief, no Default or Event of Default exists, or, if such is not the
case, specifying such Default or Event of Default and its nature, when
it occurred, and whether it is continuing and the steps being taken by
Borrower with respect to such event, condition, or failure. At the time
the financial statements are furnished pursuant to SECTION 8.2,
Borrower will deliver to the Lenders a certificate of the independent
accountants performing the audit of such financial statements
acknowledging that Borrower was in compliance with the financial
covenants of SECTION 9.1, and setting forth the procedures used to make
such determination.
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(b) Within 45 days after the end of each of the first three
fiscal quarters of each fiscal year, and within 90 days after the end
of the last fiscal quarter of each fiscal year, the following reports
with respect to Investments of Borrower and its Consolidated
Subsidiaries, as of the end of such fiscal quarter, in form and scope
acceptable to Administrative Agent:
(i) A consolidated statement of Investments as
presented in Borrower's consolidated financial statements;
(ii) A report of unrealized and realized gains
(losses) (with detail as to unrealized gains and losses by
portfolio company for private finance Investments and in the
aggregate for Commercial Mortgage Loans, small business loans,
and other Investments); and
(iii) A delinquency report identifying loans over 120
days past-due.
8.4 OTHER INFORMATION.
(a) Not later than 90 days prior to the last day of each
fiscal year of Borrower, pro forma projected consolidated financial
statements for Borrower and its Consolidated Subsidiaries reflecting
the forecasted financial condition and results of operations of
Borrower and its Consolidated Subsidiaries on a quarterly basis for the
next succeeding year, accompanied by calculations establishing whether
or not Borrower would be in compliance on a pro forma basis with the
covenants contained in SECTION 9.1, in each case in form and detail
reasonably acceptable to the Administrative Agent;
(b) Promptly upon receipt thereof, copies of all reports, if
any, submitted to Borrower or its Board of Directors by its independent
public accountants, including, without limitation, any management
report;
(c) Within five Business Days of the filing thereof, copies of
all registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent), reports on
Forms 10-K,10-Q, and 8-K (or their equivalents) and all other periodic
reports which Borrower shall file with the Securities and Exchange
Commission (or any Governmental Authority substituted therefor) or any
national securities exchange;
(d) Promptly upon the mailing thereof to the shareholders of
Borrower generally, copies of all financial statements, reports, and
proxy statements so mailed and promptly upon the issuance thereof
copies of all press releases issued by Borrower;
(e) If and when any member of the ERISA Group (i) gives or is
required to give notice to the PBGC of any "reportable event" (as
defined in Section 4043 of ERISA) with respect to any Plan which might
constitute grounds for a termination of such Plan under Title IV of
ERISA, or knows that the plan administrator of any Plan has given or is
required to give notice of any such reportable event, a copy of the
notice of such reportable event given or required to be given to the
PBGC; (ii) receives notice of complete or partial withdrawal liability
under Title IV of ERISA or notice that any Multiemployer Plan is in
reorganization, is insolvent, or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of
an intent to terminate, impose liability (other than for premiums
under Section 4007 of ERISA) in respect of, or appoint
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a trustee to administer, any Plan, a copy of such notice; (iv) applies
for a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code, a copy of such application; (v) gives notice of
intent to terminate any Plan under Section 4041(c) of ERISA, a copy of
such notice and other information filed with the PBGC; (vi) gives
notice of withdrawal from any Plan pursuant to Section 4063 of ERISA, a
copy of such notice; or (vii) fails to make any payment or contribution
to any Plan or Multiemployer Plan or in respect of any Benefit
Arrangement or makes any amendment to any Plan or Benefit Arrangement
which has resulted or could result in the imposition of a Lien or the
posting of a bond or other security, a certificate of the chief
financial officer of Borrower setting forth details as to such
occurrence and action, if any, which Borrower or applicable member of
the ERISA Group is required or proposes to take;
(f) To the extent Borrower or any Subsidiary is aware of the
same, prompt notice of the commencement of any proceeding or
investigation by or before any Governmental Authority and any action or
proceeding in any court or other tribunal or before any arbitrator
against or in any other way relating adversely to, or adversely
affecting, Borrower or any Subsidiary or any of their respective
properties, assets, or businesses which, if determined or resolved
adversely to such Person, could have a Material Adverse Effect; and
prompt notice of the receipt of notice that any United States income
tax returns of Borrower or any of its Subsidiaries are being audited;
(g) To the extent not previously delivered to the Lenders, a
copy of the articles of incorporation, bylaws, partnership agreement,
or other similar organizational documents of Borrower, any Material
Subsidiary, and any amendment thereto, in each case within five
Business Days of the effectiveness thereof;
(h) Prompt notice of any change in the business, assets,
liabilities, financial condition, results of operations, or business
prospects of Borrower or any Subsidiary which has had or may have a
Material Adverse Effect,
(i) Prompt notice of the occurrence of any Default or Event of
Default or any event which constitutes or which with the passage of
time, the giving of notice, or otherwise, would constitute a default or
event of default by Borrower or any Subsidiary under any Material
Contract to which any such Person is a party or by which any such
Person or any of its respective properties may be bound;
(j) Prompt notice of any order, judgment, or decree in excess
of $5,000,000 having been entered against Borrower or any Subsidiary or
any of their respective properties or assets;
(k) Prompt notice, which notice shall, in the case of a
Material Subsidiary, be delivered no later than five days following the
occurrence, of the acquisition, incorporation, or other creation of any
Subsidiary, the purpose for such Subsidiary, the nature of the assets
and liabilities thereof, and whether such Subsidiary is a Material
Subsidiary;
(l) At the time the quarterly financial statements are
furnished in accordance with SECTION 8.1, a list of the Persons who are
Material Subsidiaries as of the date of the balance sheet included in
such quarterly financial statements;
(m) Promptly upon entering into any Material Contract after
the Agreement Date, a copy to Administrative Agent of such Material
Contract; and
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(n) From time to time and promptly upon each request, such
data, certificates, reports, statements, opinions of counsel,
documents, or further information regarding the business, assets,
liabilities, financial condition, results of operations, or business
prospects of Borrower or any of its Material Subsidiaries as
Administrative Agent or any Lender may reasonably request.
SECTION 9 NEGATIVE COVENANTS.
For so long as this Agreement is in effect and thereafter until the
payment in full of the Obligations and the termination or expiration of all LCs,
unless the Requisite Lenders (or, if required pursuant to SECTION 12.5, all of
the Lenders) shall otherwise consent in the manner set forth in SECTION 12.5,
Borrower shall not, directly or indirectly:
9.1 FINANCIAL COVENANTS. Permit:
(a) Ratio of Consolidated Debt to Consolidated Shareholders'
Equity. The ratio of Consolidated Debt to Consolidated Shareholders'
Equity to exceed 1.50 to 1.00 at the end of any fiscal quarter.
(b) Minimum Tangible Net Worth. Consolidated Shareholders'
Equity to be less than (i) $375,000,000 plus (ii) 75% of the Net
Proceeds of all Equity Issuances effected by Borrower or any of its
Consolidated Subsidiaries at any time after September 30, 1998
(excluding the Net Proceeds of any Equity Issuance by a Consolidated
Subsidiary to a Consolidated Subsidiary or to Borrower).
(c) Ratio of Adjusted EBIT to Interest Expense. The ratio of
the Adjusted EBIT to Interest Expense of Borrower and its Consolidated
Subsidiaries, determined on a consolidated basis as of the last day of
each fiscal quarter for the period of four successive fiscal quarters
ended on such day, to be less than 1.80 to 1.00 at the end of such
fiscal quarter.
(d) Priority Debt. The aggregate principal amount of Priority
Debt to exceed 25% of Consolidated Shareholders' Equity; provided that,
in the case of any determination of Priority Debt made prior to April
30, 2001, outstanding Indebtedness of Borrower or its Consolidated
Subsidiaries secured by Real Estate Assets in an aggregate principal
amount of up to $100,000,000 shall be excluded from Priority Debt.
(e) Asset Coverage Ratio. The Asset Coverage Ratio to be less
than 2 to 1.
9.2 INTEREST RATE AGREEMENTS. Enter into, or permit any Consolidated
Subsidiary to enter into, any Interest Rate Agreement except in the ordinary
course of business pursuant to bona fide hedging transactions and not for
speculation.
9.3 LIENS; AGREEMENTS REGARDING LIENS; OTHER MATTERS.
(a) Create, assume, or incur, or permit or suffer to exist (or
permit any Consolidated Subsidiary to create, incur, assume, or permit
or suffer to exist) any Lien upon any of its assets,
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including, without limitation, the equity interests of Borrower or any
Subsidiary in their respective Subsidiaries, other than:
(i) the Permitted Liens;
(ii) Liens arising in connection with purchase money
Indebtedness, conditional sale agreements, and Capitalized
Lease Obligations incurred for the acquisition of furniture,
fixtures, equipment, or leasehold improvements in the ordinary
course of business;
(iii) Liens in existence on the Agreement Date and
securing the Indebtedness described as being secured
on SCHEDULE 6.1(g);
(iv) Liens on Real Estate Assets securing
Non-Recourse Indebtedness, so long as such Non-Recourse
Indebtedness is permitted within the limitations of SECTION
9.1;
(v) Liens securing Indebtedness under Mortgage
Repurchase Facilities or Interest Rate Agreements; provided
that, (i) the Lien of any such Mortgage Repurchase Facility
shall extend only to the Commercial Mortgage Loans which are
financed or refinanced under such Mortgage Repurchase Facility
and the Related Collateral, (ii) the aggregate advances under
such Mortgage Repurchase Facility shall not exceed 80% of the
aggregate unpaid principal amount of the Commercial Mortgage
Loans securing such Mortgage Repurchase Facility, (iii) the
Lien securing any Interest Rate Agreement shall extend only to
Commercial Mortgage Loans and Related Collateral, and (iv) all
Indebtedness secured by such Liens must be permitted within
the limitations of SECTION 9.1; and
(vi) Liens securing the Obligations, if any.
(b) Except for SBA consents that may be required for SBIC,
create or otherwise cause or suffer to exist or become effective, or
permit any Subsidiary to create or otherwise cause or suffer to exist
or become effective, any consensual encumbrance or restriction of any
kind on the ability of any Subsidiary to: (i) pay dividends or make any
other distribution on any of such Subsidiary's capital stock or other
equity interests owned by Borrower or any other Subsidiary of Borrower;
(ii) pay any Indebtedness owed to Borrower or any other Subsidiary;
(iii) make loans or advances to Borrower or any other Subsidiary; or
(iv) transfer any of its property or assets to Borrower or any other
Subsidiary.
(c) Create, incur, assume, or permit to exist, directly or
indirectly, or permit any Consolidated Subsidiary, directly or
indirectly, to create, incur, assume, or permit to exist (upon the
happening of a contingency or otherwise) any Lien (except Liens
permitted by SECTION 9.3(a)) on or with respect to any property that
secures Indebtedness of Borrower or its Consolidated Subsidiaries,
including, without limitation, Indebtedness outstanding under the
Senior Notes or the Senior Note Agreements, unless Borrower makes, or
causes to be made, effective provision whereby the Obligations will be
equally and ratably secured with any and all other Debt of Borrower or
its Consolidated Subsidiaries thereby secured; provided that, such
security is granted pursuant to an agreement reasonably satisfactory to
the Requisite Lenders.
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9.4 DISTRIBUTIONS TO SHAREHOLDERS. If an Event of Default specified in
SECTION 10.1(a) or SECTION 10.1(b) occurs and is not cured within ten Business
Days thereafter, if a Default or an Event of Default specified in SECTION
10.1(f) or SECTION 10.1(g) shall have occurred and be continuing, or if as a
result of the occurrence of any other Event of Default the Obligations have been
accelerated pursuant to SECTION 10.2(a), make (a) any dividend or other
distribution on account of any of its capital stock; (b) any acquisition for
value of any capital stock of Borrower; or (c) any payment made to retire, or to
obtain the surrender of, any outstanding warrants, options, or other rights to
acquire any capital stock of Borrower.
9.5 MERGER, CONSOLIDATION AND SALES OF ASSETS.
(a) (i) Enter into, or permit any Consolidated Subsidiary to
enter into, any transaction of merger or consolidation; (ii) liquidate,
wind-up, or dissolve itself (or suffer any liquidation or dissolution)
or permit any Consolidated Subsidiary to do any of the foregoing; (iii)
convey, sell, lease, sublease, transfer, or otherwise dispose of, in
one transaction or a series of transactions, all or any substantial
part of its business or assets, or the capital stock of or other equity
interests in any of its Consolidated Subsidiaries, in each case whether
now owned or hereafter acquired (a "SALE") or permit any Consolidated
Subsidiary to do any of the foregoing; provided, however, that, so long
as no Default or Event of Default is or would be in existence at the
time of such event or immediately after giving effect thereto:
(A) Any Consolidated Subsidiary may merge or
consolidate with or into, or effect a Sale to, Borrower or any
Wholly Owned Subsidiary, so long as (1) in any merger or
consolidation involving Borrower, Borrower shall be the
surviving or continuing corporation and (2) in any merger or
consolidation involving a Wholly Owned Subsidiary (and not
Borrower), a Wholly Owned Subsidiary shall be the surviving or
continuing corporation;
(B) In addition to the transactions permitted
under CLAUSE (E) below, Borrower may convey, sell, lease,
sublease, transfer, or otherwise dispose of, in one
transaction or a series of transactions, its business or
assets, or the capital stock of or other equity interests in
any of its Consolidated Subsidiaries, in each case whether now
owned or hereafter acquired, to any of its Consolidated
Subsidiaries, so long as (1) the Book Value of such assets
sold (in one or a series of transactions) in a given fiscal
year does not exceed 15% of the total assets of Borrower
determined at the close of the immediately preceding fiscal
year, or (2) the operations of such assets sold generated does
not exceed 15% of the consolidated operating profit of
Borrower during the immediately preceding fiscal year;
(C) A Consolidated Subsidiary may liquidate;
(D) Borrower or any Consolidated Subsidiary may merge
or consolidate with any other corporation; provided that,
Borrower or a Wholly Owned Subsidiary shall be the continuing
or surviving corporation and;
(E) Borrower or any Consolidated Subsidiary may
effect a Sale of Investments (other than Investments in a
Consolidated Subsidiary) or Foreclosure Property to third
parties, to any Special Purpose Subsidiary, or (solely with
respect to Foreclosure Property) to any Unrestricted
Subsidiary in arm's length transactions on a non-recourse
basis, so long
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as the purchaser of such Investment or Foreclosure Property
does not and will not have a claim against or interest in any
other assets of Borrower or any Consolidated Subsidiary to
support the value of the assets so sold or to enhance the
creditworthiness of securities or Debt secured by or
evidencing an interest in such assets or in the holder
thereof; and
(F) Borrower or any Consolidated Subsidiary may
effect a Sale of capital stock or other equity interests in an
Unrestricted Subsidiary to third parties in arm's length
transactions; or
(b) Permit any Consolidated Subsidiary to issue any Voting Stock of
such Consolidated Subsidiary except to satisfy the rights of minority
shareholders to receive issuances of stock, which are non-dilutive to
Borrower and/or any Consolidated Subsidiary; provided that, the
foregoing restrictions do not apply to issuances of Voting Stock to
Borrower or to a Wholly Owned Subsidiary or the issuance of directors'
qualifying shares.
As used in this Section, a sale of assets will be deemed a "substantial
part" of the assets of Borrower and its Consolidated Subsidiaries if (y) the
Book Value of such assets sold (in one or a series of transactions) in a given
fiscal year (except those assets transferred pursuant to CLAUSE (B), (E), or (F)
above sold in the ordinary course of business) exceeds 15% of the total assets
of Borrower and its Consolidated Subsidiaries determined at the close of the
immediately preceding fiscal year, or (z) the operations of such assets sold
(except those assets transferred pursuant to CLAUSE (B), (E), or (F) above sold
in the ordinary course of business) generated 15% or more of the consolidated
operating profit of Borrower and its Consolidated Subsidiaries during the
immediately preceding fiscal year.
9.6 FISCAL YEAR. Change its fiscal year from that in effect as of the
Agreement Date.
9.7 MODIFICATIONS TO MATERIAL CONTRACTS. Enter into, or permit any
Subsidiary to enter into, any amendment or modification to any Material Contract
which could have a Material Adverse Effect or default in the performance of any
obligations of Borrower or any Subsidiary under any Material Contract or permit
any Material Contract to be canceled or terminated prior to its stated maturity.
9.8 TRANSACTIONS WITH AFFILIATES. Permit to exist or enter into, and
will not permit any of its Subsidiaries to permit to exist or enter into, any
transaction (including the purchase, sale, lease, or exchange of any property or
the rendering of any service) with any Affiliate of Borrower or with any
director, officer, or employee of Borrower, any Subsidiary, or any other
Affiliate, except transactions involving consideration in aggregate amount for
all such transactions not in excess of $5,000,000 per fiscal year, and
transactions in the ordinary course of, and pursuant to the reasonable
requirements of the, business of Borrower or any of its Subsidiaries and upon
fair and reasonable terms which are no less favorable to Borrower or such
Subsidiary than would be obtained in a comparable arm's length transaction with
a Person that is not an Affiliate.
9.9 SUBSIDIARY SENIOR NOTE GUARANTY. Permit any Consolidated Subsidiary
to guarantee (including without limitation, any Subsidiary Senior Note Guaranty)
or assume or agree to become liable in any way, either directly or indirectly,
for any Debt of Borrower or any Consolidated Subsidiary (other than a
Consolidated Subsidiary of the guarantor provided such Debt does not constitute
Senior Debt), unless and until Borrower shall first furnish to Administrative
Agent (a) an unconditional Subsidiary Bank Guaranty, (b) an Intercreditor
Agreement, and (c) an opinion of counsel to the effect that such Subsidiary Bank
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Guaranty has been duly authorized, executed, and delivered by such Consolidated
Subsidiary and constitutes the legal, valid, and binding obligation of such
Consolidated Subsidiary, enforceable against such Consolidated Subsidiary in
accordance with the terms thereof, and covering such other matters as the
Requisite Lenders may reasonably request.
9.10 PAYMENT OF OBLIGATION. Borrower shall pay the Obligations in
accordance with the terms and provisions of the Loan Documents. Borrower and its
Consolidated Subsidiaries shall not (a) if an Event of Default shall have
occurred and be continuing, make any voluntary prepayment of principal of, or
interest on, any other Debt (other than the Obligations), whether subordinate to
the Obligations or not or (b) use proceeds from the Loans to make any payment or
prepayment of principal of, or interest on, or sinking fund payment in respect
of any other Debt of Borrower or any of its Subsidiaries (other than Debt in
respect of the Amended and Restated Master Loan and Security Agreement dated as
of October 7, 1998, among Borrower, Business Mortgage Investors, Inc., and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Inc., as amended from time to time, and any renewals,
extensions, or replacements thereof).
SECTION 10 DEFAULT.
10.1 EVENTS OF DEFAULT. Each of the following shall constitute an Event
of Default, whatever the reason for such event and whether it shall be voluntary
or involuntary or be effected by operation of Applicable Law or pursuant to any
judgment or order of any Governmental Authority:
(a) Default in Payment of Principal. Borrower shall fail to
pay when due (whether upon demand, at maturity, by reason of
acceleration, or otherwise) the principal of any of the Loans.
(b) Default in Payment of Other Amounts. Borrower shall fail
to pay when due any interest on any of the Loans or any of the other
payment Obligations (other than the principal of any Loan) owing by
Borrower under this Agreement or any other Loan Document and such
failure shall continue for a period of three Business Days after the
earlier of (i) the date upon which Borrower obtains knowledge of such
failure or (ii) the date upon which Borrower has received written
notice of such failure from Administrative Agent.
(c) Default in Performance. (i) Borrower shall fail (or, where
applicable, shall fail to cause any Subsidiary) to perform or observe
any term, covenant, condition or agreement on its part to be performed
or observed contained in SECTIONS 7.11, 7.12, or 8.4(i), or in SECTION
9 or (ii) Borrower shall fail (or, where applicable, shall fail to
cause any Subsidiary) to perform or observe any term, covenant,
condition, or agreement contained in this Agreement or any other Loan
Document to which it is a party and not otherwise mentioned in this
Section and in the case of this CLAUSE (ii) such failure shall continue
for a period of 30 days after the earlier of (x) the date upon which
Borrower obtains knowledge of such failure or (y) the date upon which
Borrower has received written notice of such failure from
Administrative Agent.
(d) Misrepresentations. Any written statement, representation,
or warranty made or deemed made by or on behalf of Borrower or any
Subsidiary under this Agreement or under any other Loan Document, or
any amendment hereto or thereto, or in any other writing or statement
at any time furnished or made or deemed made by or on behalf of
Borrower or any Subsidiary to Administrative Agent or any Lender in
connection with this Agreement or the other Loan Documents, shall at
any time prove to have been incorrect or misleading in any material
respect when furnished or made.
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(e) Indebtedness Cross-Default.
(i) Borrower or any Consolidated Subsidiary shall
fail to pay when due and payable the principal of, or interest
on, any Indebtedness (other than the Loans) or any Contingent
Obligations having an aggregate outstanding principal amount
of $5,000,000 or more, or
(ii) the maturity of any Indebtedness (other than the
Loans) of Borrower or any Consolidated Subsidiary having an
aggregate outstanding principal amount of $5,000,000 or more
shall have (x) been accelerated in accordance with the
provisions of any indenture, contract, or instrument
evidencing, providing for the creation of, or otherwise
concerning such Indebtedness or (y) been required to be
prepaid prior to the stated maturity thereof; or
(iii) any other event shall have occurred and be
continuing with respect to any Indebtedness (other than the
Loans) of Borrower or any Consolidated Subsidiary having an
aggregate outstanding principal amount of $5,000,000 or more
which, with or without the passage of time, the giving of
notice, or otherwise, would permit any holder or holders of
such Indebtedness, any trustee or agent acting on behalf of
such holder or holders, or any other Person to accelerate the
maturity of any such Indebtedness or require any such
Indebtedness to be prepaid prior to its stated maturity.
(f) Voluntary Bankruptcy Proceeding. Borrower, any
Consolidated Subsidiary, or any Other Relevant Subsidiary shall: (i)
commence a voluntary case under the Bankruptcy Code of 1978, as amended
or other federal bankruptcy laws (as now or hereafter in effect); (ii)
file a petition seeking to take advantage of any other Applicable Laws,
domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts;
(iii) consent to, or fail to contest in a timely and appropriate
manner, any petition filed against it in an involuntary case under such
bankruptcy laws or other Applicable Laws or consent to any proceeding
or action described in the immediately following subsection; (iv) apply
for or consent to, or fail to contest in a timely and appropriate
manner, the appointment of, or the taking of possession by, a receiver,
custodian, trustee, or liquidator of itself or of a substantial part of
its property, domestic or foreign; (v) admit in writing its inability
to pay its debts as they become due; (vi) make a general assignment for
the benefit of creditors; (vii) make a conveyance fraudulent as to
creditors under any Applicable Law; or (viii) take any corporate or
similar action for the purpose of effecting any of the foregoing.
(g) Involuntary Bankruptcy Proceeding. A case or other
proceeding shall be commenced against Borrower, any Consolidated
Subsidiary or any Other Relevant Subsidiary, in any court of competent
jurisdiction seeking: (i) relief under the Bankruptcy Code of 1978, as
amended or other federal bankruptcy laws (as now or hereafter in
effect) or under any other Applicable Laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding-up, or
composition or adjustment of debts; or (ii) the appointment of a
trustee, receiver custodian, liquidator or the like of such Person, or
of all or any substantial part of the assets domestic or foreign, of
such Person, and such case or proceeding is not dismissed within 60
days after it is commenced.
(h) Contest of Loan Documents. Borrower or any Subsidiary
shall disavow, revoke, or terminate any Loan Document to which it is a
party or shall otherwise challenge or contest in any
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action, suit, or proceeding in any court or before any Governmental
Authority the validity or enforceability of this Agreement, any Note,
or any other Loan Document.
(i) Judgment. A judgment or order for the payment of money
shall be entered against Borrower or any Consolidated Subsidiary by any
court or other tribunal which exceeds, individually or together with
all other such judgments or orders entered against Borrower and its
Consolidated Subsidiaries, $5,000,000 in amount (or which shall
otherwise have a Material Adverse Effect) and such judgment or order
shall continue unpaid for a period of 30 days without being stayed or
dismissed through appropriate appellate proceedings.
(j) Attachment. A warrant, writ of attachment, execution, or
similar process shall be issued against any property of Borrower or any
Consolidated Subsidiary which exceeds, individually or together with
all other such warrants, writs, executions, and processes, $5,000,000
in amount and such warrant, writ, execution, or process shall not be
discharged, vacated, stayed, or bonded for a period of 30
days; provided, however, that if a bond has been issued in favor of the
claimant or other Person obtaining such warrant, writ, execution, or
process, the issuer of such bond shall execute a waiver or
subordination agreement in form and substance satisfactory to
Administrative Agent pursuant to which the issuer of such bond
subordinates its right of reimbursement, contribution, or subrogation
to the Obligations and waives or subordinates any Lien it may have on
the assets of Borrower or any of its Consolidated Subsidiaries.
(k) ERISA. Any member of the ERISA Group shall fail to pay
when due an amount or amounts aggregating in excess of $5,000,000 which
it shall have become liable to pay under Title IV of ERISA; or notice
of intent to terminate a Material Plan shall be filed under Title IV of
ERISA by any member of the ERISA Group, any plan administrator or any
combination of the foregoing; or the PBGC shall institute proceedings
under Title IV of ERISA to terminate, to impose liability (other than
for premiums under Section 4007 of ERISA) in respect of, or to cause a
trustee to be appointed to administer any Material Plan; or a condition
shall exist by reason of which the PBGC would be entitled to obtain a
decree adjudicating that any Material Plan must be terminated; or there
shall occur a complete or partial withdrawal from, or a default, within
the meaning of Section 4219(c)(5) of ERISA, with respect to, one or
more Multiemployer Plans which could cause one or more members of the
ERISA Group to incur a current payment obligation in excess of
$5,000,000.
(l) Loan Documents. An Event of Default (as defined therein)
shall occur under any of the other Loan Documents.
(m) Change of Control.
(i) Any "person" or "group" (as such terms are used
in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended (the "EXCHANGE ACT")) is or becomes the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under
the Exchange Act, except that a Person will be deemed to have
"beneficial ownership" of all securities that such Person has
the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or
indirectly, of more than 25% of the total voting power of the
then outstanding voting stock of Borrower; or
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(ii) During any twelve-month period (commencing on or
after the Agreement Date), a majority of the Board of
Directors of Borrower shall no longer be composed of
individuals (A) who were members of such Board of Directors on
the first date of such period, (B) whose election or
nomination to such Board of Directors was approved by
individuals referred to in CLAUSE (A) above constituting at
the time of such election or nomination at least a majority of
such Board of Directors or (C) whose election or nomination to
such Board of Directors was approved by individuals referred
to in CLAUSES (A) and (B) above constituting at the time of
such election or nomination at least a majority of such Board
of Directors.
(n) Dissolution. Any order, judgment, or decree is entered
against Borrower, any Material Subsidiary or any Other Relevant
Subsidiary decreeing the dissolution or split up of such Person, and
such order remains undischarged or unstayed for a period in excess of
30 days.
(o) Payment of Certain Other Agreements. The payment directly
or indirectly (including, without limitation, any payment in respect of
any sinking fund, defeasance, or redemption) by Borrower or any of its
Consolidated Subsidiaries of any Debt, including without limitation,
the Senior Notes, in a manner or at a time during which such payment is
not permitted under the terms of the Loan Documents, or under any
instrument or document evidencing or creating such Debt.
(p) LCs. Administrative Agent shall have been served with, or
becomes otherwise subject to, a court order, injunction, or other
process or decree restraining or seeking to restrain it from paying any
amount under any LC and either (a) there has been a drawing under such
LC which Administrative Agent would otherwise be obligated to pay and
Borrower has refused to reimburse Administrative Agent for such payment
or (b) the expiration date of such LC has occurred but the right of any
beneficiary thereunder to draw under such LC has been extended past the
expiration date in connection with the pendency of the related court
action or proceeding and Borrower has failed to deposit with
Administrative Agent cash collateral in an amount equal to the maximum
drawing which could be made under such LC.
10.2 REMEDIES UPON EVENT OF DEFAULT. Upon the occurrence of an Event of
Default the following provisions shall apply:
(a) Acceleration; Termination of Facilities.
(i) Automatic. Upon the occurrence of an Event of
Default specified in SECTIONS 10.1(f) or 10.1(g), (A) (i) the
principal of, and all accrued interest on, the Loans and the
Notes at the time outstanding and (ii) all of the other
Obligations of Borrower, including, but not limited to, the
other amounts owed to Lenders and Administrative Agent under
this Agreement, the Notes, or any of the other Loan Documents
shall become immediately and automatically due and payable by
Borrower without presentment, demand, protest, or other notice
of any kind, all of which are expressly waived by Borrower and
Borrower shall be required to provide cash collateral in an
amount equal to 100% of the LC Exposure then existing in
accordance with SECTION 2.3(g) and (B) each of the Commitments
(including the Swing Line Commitment and any Commitments under
the LC Subfacility) and the obligation of Lenders to make
Loans and the obligation of Administrative Agent to issue LCs
shall immediately and automatically terminate;
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(ii) Optional. If any other Event of Default shall
have occurred and be continuing, Administrative Agent may, and
at the direction of the Requisite Lenders shall (subject to
the terms of SECTION 11): (A) declare (1) the principal of,
and accrued and unpaid interest on, the Loans and the Notes at
the time outstanding and (2) all of the other Obligations,
including, but not limited to, the other amounts owed to the
Lenders and Administrative Agent under this Agreement, the
Notes, or any of the other Loan Documents, to be forthwith due
and payable; whereupon the same shall immediately become due
and payable without presentment, demand, protest, or other
notice of any kind, all of which are expressly waived by
Borrower, (B) demand Borrower to provide cash collateral in an
amount equal to 100% of the LC Exposure then existing in
accordance with SECTION 2.3(g), and (C) terminate the
Commitments (including the Swing Line Commitment and any
Commitments under the LC Subfacility) and the obligation of
Lenders to make Loans hereunder and the obligation of
Administrative Agent to issue LCs hereunder.
(b) Loan Documents. The Requisite Lenders may direct
Administrative Agent to, and Administrative Agent if so directed shall
(subject to the terms of SECTION 11), exercise any and all of its
rights under any and all of the other Loan Documents.
(c) Applicable Law. The Requisite Lenders may direct
Administrative Agent to, and Administrative Agent if so directed shall,
exercise all other rights and remedies it may have under any Applicable
Law, including without limitation, (i) reduce any claim to judgment;
(ii) to the extent permitted by Applicable Law, exercise (or request
each Lender to, and each Lender shall be entitled to, exercise) the
rights of offset or banker's Lien against the interest of Borrower and
each Consolidated Subsidiary in and to every account and other property
of Borrower and each Consolidated Subsidiary which are in the
possession of Administrative Agent or any Lender to the extent of the
full amount of the Obligations (to the extent permitted by Applicable
Law, Borrower and each Consolidated Subsidiary being deemed directly
obligated to each Lender in the full amount of the Obligations for such
purposes); and (iii) exercise any and all other legal or equitable
rights afforded by the Loan Documents, the Applicable Laws of the State
of Texas, or any other applicable jurisdiction as Administrative Agent
shall deem appropriate, or otherwise, including, but not limited to,
the right to bring suit or other proceedings before any Governmental
Authority either for specific performance of any covenant or condition
contained in any of the Loan Documents or in aid of the exercise of any
right granted to Administrative Agent or any Lender in any of the Loan
Documents.
10.3 REMEDIES UPON CERTAIN DEFAULTS. Upon the occurrence of a Default
specified in SECTIONS 10.1(F) or 10.1(G), the Commitments (including the Swing
Line Commitment and any Commitments under the LC Subfacility) shall immediately
and automatically terminate.
10.4 ALLOCATION OF PROCEEDS. If a Default or Event of Default shall
have occurred and be continuing, all payments received by Administrative Agent
or any Lender under any of the Loan Documents, in respect of any principal of or
interest on the Obligations or any other amounts payable by Borrower hereunder
or thereunder (including proceeds from the exercise of any rights), shall be
applied by Administrative Agent in the following order and priority:
(a) Amounts due to Administrative Agent and the Lenders in
respect of Fees and expenses due under SECTION 12.2;
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(b) Payments of interest on the Revolving Loans and the Swing
Line Loans to be applied for the ratable benefit of Lenders and Bank of
America (as the Lender under the Swing Line Subfacility, and any
participating Lenders under the Swing Line Facility pursuant to SECTION
2.2(b));
(c) Payment of all unpaid reimbursement obligations with
respect to any LCs issued pursuant to the Agreement which are due and
payable and which remain unfunded by any Borrowing, provided that, such
payments shall be allocated ratably among Bank of America and the
Lenders which have funded their participations in such LC;
(d) Payments of outstanding Swing Principal Debt; provided
that, such payments shall be made solely to Bank of America, unless the
Lenders have purchased participations in the Swing Principal Debt in
accordance with SECTION 2.2(B), in which case such payment shall be
allocated pro rata among Bank of America and the participating Lenders;
(e) Payments of principal outstanding under the Revolving
Loans, to be applied for the ratable benefit of the Lenders;
(f) As a deposit with Administrative Agent (for the benefit of
Bank of America and the Lenders which have purchased participations in
any outstanding LC), as security for, and to provide for the payment of
, any reimbursement obligations, if any, thereafter arising with
respect to any issued and outstanding LCs issued pursuant to the
Agreement;
(g) Amounts due to Administrative Agent and the Lenders
pursuant to SECTION 12.8;
(h) Payments of all other amounts due under any of the Loan
Documents, if any, to be applied for the ratable benefit of the
Lenders; and
(i) Any amount remaining after application as provided above,
shall be paid to Borrower or whomever else may be legally entitled
thereto.
10.5 PERFORMANCE BY ADMINISTRATIVE AGENT. If Borrower shall fail to
perform any covenant, duty, or agreement contained in any of the Loan Documents,
Administrative Agent may perform or attempt to perform such covenant, duty, or
agreement on behalf of Borrower after the expiration of any cure or grace
periods set forth herein. In such event, Borrower shall, at the request of
Administrative Agent, promptly pay any amount reasonably expended by
Administrative Agent in such performance or attempted performance to
Administrative Agent, together with interest thereon at the applicable
Post-Default Rate from the date of such expenditure until paid. Notwithstanding
the foregoing, neither Administrative Agent nor any Lender shall have any
liability or responsibility whatsoever for the performance of any obligation of
Borrower under this Agreement or any other Loan Document.
10.6 RIGHTS CUMULATIVE. The rights and remedies of Administrative Agent
and the Lenders under this Agreement and each of the other Loan Documents shall
be cumulative and not exclusive of any rights or remedies which any of them may
otherwise have under Applicable Law.
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10.7 COMPANY WAIVERS. To the extent permitted by Applicable Law,
Borrower and each Subsidiary hereby waive presentment and demand for payment,
protest, notice of intention to accelerate, notice of acceleration, and notice
of protest and nonpayment, and agree that their respective liability with
respect to the Obligations (or any part thereof) shall not be affected by any
renewal or extension in the time of payment of the Obligations (or any part
thereof), by any indulgence, or by any release or change in any security for the
payment of the Obligations (or any part thereof).
10.8 DELEGATION OF DUTIES AND RIGHTS. The Lenders may perform any of
their duties or exercise any of their rights under the Loan Documents by or
through their respective representatives.
10.9 NOT IN CONTROL. Nothing in any Loan Document shall, or shall be
deemed to (a) give Administrative Agent or any Lender the right to exercise
control over the assets (including real property), affairs, or management of
Borrower or any Subsidiary, (b) preclude or interfere with compliance by
Borrower or any Subsidiary with any Applicable Law, or (c) require any act or
omission by Borrower or any Subsidiary that may be harmful to Persons or
property. Any "Material Adverse Event" or other materiality qualifier in any
representation, warranty, covenant, or other provision of any Loan Document is
included for credit documentation purposes only and shall not, and shall not be
deemed to, mean that Administrative Agent or any Lender acquiesces in any
non-compliance by Borrower or any Subsidiary with any Applicable Law or
document, or that any Agent or any Lender does not expect Borrower or any
Subsidiary to promptly, diligently, and continuously carry out all appropriate
removal, remediation, and termination activities required or appropriate in
accordance with all Environmental Laws. Administrative Agent and the Lenders
have no fiduciary relationship with or fiduciary duty to Borrower or any
Subsidiary arising out of or in connection with the Loan Documents, and the
relationship between Administrative Agent and the Lenders, on the one hand, and
Borrower and its Subsidiaries, on the other hand, in connection with the Loan
Documents is solely that of debtor and creditor. The power of Administrative
Agent and the Lenders under the Loan Documents is limited to the rights provided
in the Loan Documents, which rights exist solely to assure payment and
performance of the Obligations and may be exercised in a manner calculated by
Administrative Agent and Lenders in their respective good faith business
judgment.
10.10 COURSE OF DEALING. The acceptance by Administrative Agent or the
Lenders at any time and from time to time of partial payment on the Obligations
shall not be deemed to be a waiver of any Default then existing. No waiver by
Administrative Agent, Requisite Lenders, or the Lenders of any Default shall be
deemed to be a waiver of any other then-existing or subsequent Default. No delay
or omission by Administrative Agent, Requisite Lenders, or the Lenders in
exercising any right under the Loan Documents shall impair such right or be
construed as a waiver thereof or any acquiescence therein, nor shall any single
or partial exercise of any such right preclude other or further exercise
thereof, or the exercise of any other right under the Loan Documents or
otherwise.
10.11 CUMULATIVE RIGHTS. All rights available to Administrative Agent
and the Lenders under the Loan Documents are cumulative of and in addition to
all other rights granted to Administrative Agent and the Lenders at law or in
equity, whether or not the Obligations are due and payable and whether or not
Administrative Agent or the Lenders have instituted any suit for collection,
foreclosure, or other action in connection with the Loan Documents.
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SECTION 11 AGREEMENT AMONG LENDERS.
11.1 APPOINTMENT, POWERS, AND IMMUNITIES. Each Lender hereby
irrevocably appoints and authorizes Administrative Agent to act as its agent
under this Agreement and the other Loan Documents with such powers and
discretion as are specifically delegated to Administrative Agent by the terms of
this Agreement and the other Loan Documents, together with such other powers as
are reasonably incidental thereto. Administrative Agent (which term as used in
this sentence and in SECTION 11.5 and the first sentence of SECTION 11.6 hereof
shall include its Affiliates and its own and its Affiliates' officers,
directors, employees, and agents): (a) shall not have any duties or
responsibilities except those expressly set forth in this Agreement and shall
not be a trustee or fiduciary for any Lender; (b) shall not be responsible to
the Lenders for any recital, statement, representation, or warranty (whether
written or oral) made in or in connection with any Loan Document or any
certificate or other document referred to or provided for in, or received by any
of them under, any Loan Document, or for the value, validity, effectiveness,
genuineness, enforceability, or sufficiency of any Loan Document, or any other
document referred to or provided for therein or for any failure by any party
hereto or any other Person to perform any of its obligations thereunder; (c)
shall not be responsible for or have any duty to ascertain, inquire into, or
verify the performance or observance of any covenants or agreements by the
parties hereto or the satisfaction of any condition or to inspect the property
(including the books and records) of Borrower or its Subsidiaries or Affiliates;
(d) shall not be required to initiate or conduct any litigation or collection
proceedings under any Loan Document; and (e) shall not be responsible for any
action taken or omitted to be taken by it under or in connection with any Loan
Document, except for its own gross negligence or willful misconduct.
Administrative Agent may employ agents and attorneys-in-fact and shall not be
responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care.
11.2 RELIANCE BY ADMINISTRATIVE AGENT. Administrative Agent shall be
entitled to rely upon any certification, notice, instrument, writing, or other
communication (including, without limitation, any thereof by telephone or
telecopy) believed by it to be genuine and correct and to have been signed,
sent, or made by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel for the parties hereto),
independent accountants, and other experts selected by Administrative Agent.
Administrative Agent may deem and treat the payee of any Note as the holder
thereof for all purposes hereof unless and until Administrative Agent receives
and accepts an Assignment and Acceptance executed in accordance with SECTION
12.4. As to any matters not expressly provided for by this Agreement,
Administrative Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Requisite Lenders, and such instructions shall be binding on all of the
Lenders; provided, however, that Administrative Agent shall not be required to
take any action that exposes Administrative Agent to personal liability or that
is contrary to any Loan Document or Applicable Law or unless it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking any such action.
11.3 DEFAULTS. Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of a Default or Event of Default unless Administrative
Agent has received written notice from a Lender or Borrower specifying such
Default or Event of Default and stating that such notice is a "NOTICE OF
DEFAULT". In the event that Administrative Agent receives such a notice of the
occurrence of a Default or Event of Default, Administrative Agent shall give
prompt notice thereof to the Lenders. Administrative Agent shall (subject TO
SECTION 11.2 hereof) take such action with respect to such Default or Event of
Default as shall reasonably be directed by the Requisite Lenders; provided that,
unless and until Administrative
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Agent shall have received such directions, Administrative Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interest of the Lenders.
11.4 RIGHTS AS LENDER. With respect to its Commitment and the Loans
made by it, Bank of America (and any successor acting as Administrative Agent),
in its capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
acting as Administrative Agent, and the term "LENDER" or "LENDERS" shall, unless
the context otherwise indicates, include Administrative Agent in its individual
capacity. Bank of America (and any successor acting as Administrative Agent) and
its Affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in, provide services to, and
generally engage in any kind of lending, trust, or other business with any party
hereto or any of its Subsidiaries or Affiliates as if it were not acting as
Administrative Agent (collectively, "other activities"), and Bank of America
(and any successor acting as Administrative Agent) and its Affiliates may accept
fees and other consideration from any party hereto or any of its Subsidiaries or
Affiliates for services in connection with this Agreement or otherwise without
having to account for the same to the Lenders. Without limiting the rights of
the Lenders specifically set forth in the Loan Documents, Administrative Agent
and its Affiliates shall not be responsible to account to Lenders for such other
activities, and no Lender shall have any interest in any other activities, any
present or future guaranties by or for the account of Borrower which are not
contemplated or included in the Loan Documents, any present or future offset
exercised by Administrative Agent and its Affiliates in respect of such other
activities, any present or future property taken as security for any such other
activities, or any property now or hereafter in the possession or control of
Administrative Agent or its Affiliates which may be or become security for the
obligations of Borrower arising under the Loan Documents by reason of the
general description of indebtedness secured or of property contained in any
other agreements, documents or instruments related to any such other
activities; provided that, if any payments in respect of such guaranties or such
property or the proceeds thereof shall be applied to reduction of the
obligations of Borrower arising under the Loan Documents, then each Lender shall
be entitled to share in such application ratably.
11.5 INDEMNIFICATION. The Lenders agree to indemnify Administrative
Agent (to the extent not reimbursed under SECTION 12.2 or SECTION 12.8, but
without limiting the obligations of Borrower under such Section) ratably in
accordance with their respective Commitments, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including attorneys' fees), or disbursements of any kind and nature
whatsoever that may be imposed on, incurred by or asserted against
Administrative Agent (including by any Lender) in any way relating to or arising
out of any Loan Document or the transactions contemplated thereby or any action
taken or omitted by Administrative Agent under any Loan Document; provided that
no Lender shall be liable for any of the foregoing to the extent they arise from
the gross negligence or willful misconduct of Administrative Agent. Without
limitation of the foregoing, each Lender agrees to reimburse Administrative
Agent promptly upon demand for its ratable share of any costs or expenses
payable by Borrower under SECTION 12.2, to the extent that Administrative Agent
is not promptly reimbursed for such costs and expenses by Borrower. The
agreements contained in this Section shall survive payment in full of the
Obligations and termination or expiration of all LCs.
11.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS. Each
Lender agrees that it has, independently and without reliance on Administrative
Agent or any other Lender, and based on such documents and information as it has
deemed appropriate, made its own credit analysis of the parties hereto and their
Subsidiaries and decision to enter into this Agreement and that it will,
independently and without reliance upon Administrative Agent or any other
Lender, and based on such documents and information as
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it shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under the Loan Documents. Except for
notices, reports, and other documents and information expressly required to be
furnished to the Lenders by Administrative Agent hereunder, Administrative Agent
shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the affairs, financial condition, or business of
any party hereto or any of its Subsidiaries or Affiliates that may come into the
possession of Administrative Agent or any of its Affiliates.
11.7 RESIGNATION OF ADMINISTRATIVE AGENT. Administrative Agent may
resign at any time by giving notice thereof to the Lenders and Borrower. Upon
any such resignation, the Requisite Lenders shall have the right to appoint a
successor Administrative Agent. If no successor Administrative Agent shall have
been so appointed by the Requisite Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent's giving of
notice of resignation, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent which shall be a
commercial bank organized under the laws of the United States of America having
combined capital and surplus of at least $100,000,000. Upon the acceptance of
any appointment as Administrative Agent hereunder by a successor, such successor
shall thereupon succeed to and become vested with all the rights, powers,
discretion, privileges, and duties of the retiring Administrative Agent, and the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder (provided, however, that when used in connection with LCs
issued and outstanding prior to the appointment of the successor Administrative
Agent, "Administrative Agent" shall continue to refer solely to the bank that
issued the outstanding LC; provided further that any LCs issued or renewed after
the appointment of any successor Administrative Agent shall be issued by such
successor Administrative Agent), and each Lender shall execute such documents as
any Lender may reasonably request to reflect such change in and under the Loan
Documents. After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this SECTION 11 shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as Administrative Agent.
11.8 RELATIONSHIP OF LENDERS. Nothing herein shall be construed as
creating a partnership or joint venture among Administrative Agent and the
Lenders.
11.9 BENEFITS OF AGREEMENT. None of the provisions of this SECTION 11
shall inure to the benefit of Borrower or any Subsidiary of Borrower or any
other Person other than the Lenders; consequently, either Borrower or any
Subsidiary or any other Person shall be entitled to rely upon, or to raise as a
defense, in any manner whatsoever, the failure of Administrative Agent or any
Lender to comply with such provisions.
11.10 OBLIGATIONS SEVERAL. The obligations of the Lenders hereunder are
several, and each Lender hereunder shall not be responsible for the obligations
of the other Lenders hereunder, nor will the failure of one Lender to perform
any of its obligations hereunder relieve the other Lenders from the performance
of their respective obligations hereunder.
11.11 AGENTS. None of the Lenders identified in this Agreement as
"Syndication Agent," "Documentation Agent," "Managing Agent," or "Co-Agents"
shall have any rights, powers, obligations, liabilities, responsibilities, or
duties under this Agreement other than those applicable to all Lenders as such.
Without limiting the foregoing, none of the Lenders so identified as a
"Syndication Agent," "Documentation Agent," "Managing Agent," or "Co-Agent"
shall have or be deemed to have any fiduciary relationship with any Lender.
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SECTION 12 MISCELLANEOUS.
12.1 NOTICES. Unless otherwise provided herein, communications provided
for hereunder shall be in writing and shall be mailed, telecopied or delivered
as follows:
If to Borrower:
Allied Capital Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Treasurer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
If to Administrative Agent:
Bank of America, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
If to a Lender:
To such Lender's address or telecopy number, as applicable,
set forth on SCHEDULE 2 hereto or in the applicable Assignment
and Acceptance Agreement.
or, as to each party at such other address as shall be designated by such party
in a written notice to the other parties delivered in compliance with
this SECTION 12.1. All such notices and other communications shall be effective
(i) if mailed, when received; (ii) if telecopied, when transmitted; or (iii) if
hand delivered, when delivered. Notwithstanding the immediately preceding
sentence, all notices or communications to Administrative Agent or any Lender
under SECTION 2 shall be effective only when actually received. Neither
Administrative Agent nor any Lender shall incur any liability to Borrower (nor
shall Administrative Agent incur any liability to the Lenders) for acting upon
any telephonic notice referred to in this Agreement which Administrative Agent
or such Lender, as the case may be, believes in good faith to have been given by
a Person authorized to deliver such notice or for otherwise acting in good faith
under hereunder, except in the case of gross negligence or willful misconduct.
12.2 EXPENSES. Borrower agrees to pay on demand all costs and expenses
of Administrative Agent in connection with the syndication, preparation,
execution, delivery, administration, modification, and amendment of this
Agreement, the other Loan Documents, and the other documents to be delivered
hereunder, including, without limitation, the reasonable fees and expenses of
counsel for Administrative Agent (including the cost of internal counsel) with
respect thereto and with respect to advising Administrative Agent as to its
rights and responsibilities under the Loan Documents. Borrower further agrees to
pay on demand all costs and expenses of Administrative Agent and the Lenders, if
any (including,
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without limitation, reasonable attorneys' fees and expenses and the cost of
internal counsel), in connection with the enforcement (whether through
negotiations, legal proceedings, or otherwise) of the Loan Documents and the
other documents to be delivered hereunder. All costs and expenses of
Administrative Agent and Lenders described in this SECTION 12.2 are part of the
Obligations and, if Borrower shall not have paid such costs and expenses on or
before the 60th day from the date an invoice is presented to Borrower,
Administrative Agent is hereby irrevocably authorized to fund such obligation as
a Swing Line Loan to the extent of availability under the Swing Line
Subfacility.
12.3 JURISDICTION; CONSENT TO SERVICE OF PROCESS; WAIVER OF JURY TRIAL.
(a) BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY
SUBMITS,FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION
OF ANY NEW YORK STATE COURT OR FEDERAL COURT OF THE UNITED STATES OF
AMERICA SITTING IN NEW YORK CITY, AND ANY APPELLATE COURT FROM ANY
THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF
ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN
SUCH NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH
FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT
IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE
ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY
RIGHT THAT ANY AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS AGAINST BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.
(b) BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO
THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO,ANY OBJECTION
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE OTHER LOAN DOCUMENTS IN ANY NEW YORK STATE OR FEDERAL COURT. EACH
OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
(c) BORROWER AND EACH OTHER PARTY HERETO CONSENTS TO SERVICE
OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 12.1. NOTHING
IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS AGREEMENT
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
(d) EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS. EACH PARTY HERETO (1) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVER AND(2) ACKNOWLEDGES THAT IT AND
THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
AND THE OTHER LOAN
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DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION.
12.4 SUCCESSORS AND ASSIGNS.
(a) Each Lender may assign to one or more Eligible Assignees
all or a portion of its rights, obligations, or rights and obligations
under this Agreement (including, without limitation, all or a portion
of its Commitment or its Revolving Loans, together with any funded
participations under the Swing Line Subfacility and the LC
Subfacility); provided, however, that:
(i) Each such assignment shall be to an Eligible
Assignee;
(ii) Except in the case of an assignment to
another Lender or an assignment of all of a Lender's rights
and obligations under this Agreement, any such partial
assignment shall be in an amount at least equal to $10,000,000
or an integral multiple of $1,000,000 in excess thereof;
(iii) Each such assignment by a Lender shall be of
a constant, and not varying, percentage of all of its rights
and obligations under this Agreement and each Note; and
(iv) The parties to such assignment shall execute
and deliver to Administrative Agent for its acceptance an
Assignment and Acceptance in the form of EXHIBIT A hereto,
together with any Note subject to such assignment and a
processing fee of $3,500.
Upon execution, delivery, and acceptance of such Assignment and
Acceptance, the assignee thereunder shall be a party hereto and, to the
extent of such assignment, have the obligations, rights, and benefits
of a Lender hereunder and the assigning Lender shall, to the extent of
such assignment, relinquish its rights and be released from its
obligations under this Agreement. Upon the consummation of any
assignment pursuant to this Section, the assignor, Administrative Agent
and Borrower shall make appropriate arrangements so that, if required,
new Notes are issued to the assignor and the assignee. If the assignee
is not incorporated under the laws of the United States of America or a
state thereof, it shall deliver to Borrower and Administrative Agent
certification as to exemption from deduction or withholding of Taxes in
accordance with SECTION 4.6.
(b) Administrative Agent shall maintain at its address
referred to in SECTION 12.1 a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of
the names and addresses of the Lenders and the Commitment of, and
principal amount of the Revolving Loans owing to, each Lender from time
to time (the "REGISTER"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and
Borrower, Administrative Agent and the Lenders may treat each Person
whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for
inspection by Borrower or any Lender at any reasonable time and from
time to time upon reasonable prior notice.
(c) Upon its receipt of an Assignment and Acceptance executed
by the parties thereto, together with any Note subject to such
assignment and payment of the processing fee, Administrative Agent
shall, if such Assignment and Acceptance has been completed and is in
substantially the form of EXHIBIT A hereto, (i) accept such Assignment
and Acceptance, (ii) record the information
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contained therein in the Register, and (iii) give prompt notice thereof
to the parties thereto and Borrower.
(d) Each Lender may sell participations to one or more Persons
(each a "PARTICIPANT") in all or a portion of its rights, obligations
or rights and obligations under this Agreement (including all or a
portion of its Commitment or its Loans); provided, however, that (i)
such Lender's obligations under this Agreement shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) the Participant
shall be entitled to the benefit of the yield protection provisions
contained in SECTION 4 and the right of set-off contained in SECTION
3.4 (provided that Borrower shall not be obligated to pay any amount in
excess of the amount that would be due to such Lender from whom such
participation was purchased under such Sections as though no
participation had been sold), and (iv) Borrower shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the obligations of Borrower relating
to its Loans and its Note and to approve any amendment, modification,
or waiver of any provision of this Agreement (other than amendments,
modifications, or waivers decreasing the amount of principal of or the
rate at which interest is payable on such Loans or Note, extending any
scheduled principal payment date or date fixed for the payment of
interest on such Loans or Note, or extending its Commitment).
(e) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time assign and pledge all or any
portion of its Loans and its Notes to any Federal Reserve Bank as
collateral security pursuant to Regulation A of the Board of Governors
of the Federal Reserve System and any "operating circular" issued by
such Federal Reserve Bank. No such assignment shall release the
assigning Lender from its obligations hereunder.
(f) Any Lender may furnish any information concerning Borrower
or any of its Subsidiaries in the possession of such Lender from time
to time to Eligible Assignees and Participants (including prospective
assignees and participants), subject, however, to the provisions of
SECTION 12.7.
12.5 AMENDMENTS. Any provision of this Agreement or any other Loan
Document may be amended or waived if, but only if, such amendment or waiver is
in writing and is:
(a) Executed by Borrower, Administrative Agent, and the
particular existing or new Lender if it purports (subject to SECTION
2.13) to increase that Lender's Commitment or add such new Lender as a
new Lender pursuant to SECTION 2.13.
(b) Executed by Borrower, Administrative Agent, and executed
or approved in writing by all Lenders if action of all Lenders is
specifically provided in any Loan Document or if it purports to (i)
increase the Commitments of the Lenders (except increases in accordance
with SECTION 2.13); (ii) reduce the principal of, or rate of interest
on, any Revolving Loan; reduce any reimbursement obligation with
respect to any LC; or reduce any Fees or other amounts payable
hereunder; (iii) postpone any date fixed for the payment of any
scheduled installment of principal of or interest on any Revolving
Loan, the payment of any reimbursement obligation with respect to any
LC, the payment of any Fees or other amounts payable hereunder, or the
termination of any Commitment; or (iv) change the percentage of the
Commitments or of the unpaid principal amount of the Notes,
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or the number of Lenders, which shall be required for the Lenders or
any of them to take any action under this Section or any other
provision of this Agreement.
(c) Otherwise (i) for this Agreement, executed by Borrower,
Administrative Agent, and Requisite Lenders, (ii) for other Loan
Documents (other than Interest Rate Agreements), approved in writing by
Requisite Lenders and executed by Borrower, Administrative Agent, and
any other party to that Loan Document, or (iii) for Interest Rate
Agreements, executed by the parties to such agreement.
12.6 NONLIABILITY OF AGENT AND LENDERS. The relationship between
Borrower and the Lenders and Administrative Agent shall be solely that of
borrower and lender. Neither Administrative Agent nor any Lender shall have any
fiduciary responsibilities to Borrower; and no provision in this Agreement or in
any of the other Loan Documents, and no course of dealing between or among any
of the parties hereto, shall be deemed to create any fiduciary duty owing by
Administrative Agent or any Lender to any Lender, Borrower, or any Subsidiary.
Neither Administrative Agent nor any Lender undertakes any responsibility to
Borrower to review or inform Borrower of any matter in connection with any phase
of Borrower's business or operations.
12.7 CONFIDENTIALITY. Administrative Agent and each Lender (each,
a "LENDING PARTY") agrees to keep confidential any information furnished or made
available to it by Borrower pursuant to this Agreement that is marked
confidential;provided that nothing herein shall prevent any Lending Party from
disclosing such information (a) to any other Lending Party or any affiliate of
any Lending Party, or any officer, director, employee, agent, or advisor of any
Lending Party or affiliate of any Lending Party, (b) to any other Person if
reasonably incidental to the administration of the credit facility provided
herein, (c) as required by any law, rule, or regulation, (d) upon the order of
any court or administrative agency, (e) upon the request or demand of any
regulatory agency or authority, (f) that is or becomes available to the public
or that is or becomes available to any Lending Party other than as a result of a
disclosure by any Lending Party prohibited by this Agreement, (g) in connection
with any litigation to which such Lending Party or any of its affiliates may be
a party, (h) to the extent necessary in connection with the exercise of any
remedy under this Agreement or any other Loan Document, and (i) subject to
provisions substantially similar to those contained in this Section, to any
actual or proposed participant or assignee.
12.8 INDEMNIFICATION.
(A) BORROWER AGREES TO INDEMNIFY AND HOLD HARMLESS
ADMINISTRATIVE AGENT AND EACH LENDER AND EACH OF THEIR AFFILIATES AND
THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ATTORNEYS, AND
ADVISORS (EACH, AN "INDEMNIFIED PARTY") FROM AND AGAINST ANY AND ALL
CLAIMS, DAMAGES, LOSSES, LIABILITIES, COSTS, AND EXPENSES (INCLUDING,
WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES) THAT MAY BE INCURRED BY
OR ASSERTED OR AWARDED AGAINST ANY INDEMNIFIED PARTY, IN EACH CASE
ARISING OUT OF OR IN CONNECTION WITH OR BY REASON OF (INCLUDING,
WITHOUT LIMITATION, IN CONNECTION WITH ANY INVESTIGATION, LITIGATION,
OR PROCEEDING OR PREPARATION OF DEFENSE IN CONNECTION THEREWITH) THE
LOAN DOCUMENTS, ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN OR THE
ACTUAL OR PROPOSED USE OF THE PROCEEDS OF THE LOANS, EXCEPT TO THE
EXTENT SUCH CLAIM, DAMAGE, LOSS, LIABILITY, COST, OR EXPENSE IS FOUND
IN A FINAL, NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT
JURISDICTION TO HAVE RESULTED FROM SUCH INDEMNIFIED PARTY'S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT. IN THE CASE OF AN INVESTIGATION,
LITIGATION OR OTHER PROCEEDING TO WHICH THE
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
69
75
INDEMNITY IN THIS SECTION 12.8 APPLIES, SUCH INDEMNITY SHALL BE
EFFECTIVE WHETHER OR NOT SUCH INVESTIGATION, LITIGATION OR PROCEEDING
IS BROUGHT BY BORROWER, ITS DIRECTORS, SHAREHOLDERS OR CREDITORS OR AN
INDEMNIFIED PARTY OR ANY OTHER PERSON OR ANY INDEMNIFIED PARTY IS
OTHERWISE A PARTY THERETO AND WHETHER OR NOT THE TRANSACTIONS
CONTEMPLATED HEREBY ARE CONSUMMATED. BORROWER AGREES NOT TO ASSERT ANY
CLAIM AGAINST ADMINISTRATIVE AGENT, ANY LENDER, ANY OF THEIR
AFFILIATES, OR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES,
ATTORNEYS, AGENTS, AND ADVISERS, ON ANY THEORY OF LIABILITY, FOR
SPECIAL, INDIRECT, CONSEQUENTIAL, OR PUNITIVE DAMAGES ARISING OUT OF OR
OTHERWISE RELATING TO THE LOAN DOCUMENTS, ANY OF THE TRANSACTIONS
CONTEMPLATED HEREIN OR THE ACTUAL OR PROPOSED USE OF THE PROCEEDS OF
THE LOANS.
(B) WITHOUT PREJUDICE TO THE SURVIVAL OF ANY OTHER AGREEMENT
OF BORROWER HEREUNDER, THE AGREEMENTS AND OBLIGATIONS OF BORROWER
CONTAINED IN THIS SECTION 12.8 SHALL SURVIVE THE PAYMENT IN FULL OF THE
LOANS AND ALL OTHER AMOUNTS PAYABLE UNDER THIS AGREEMENT.
12.9 TERMINATION; SURVIVAL. At such time as (a) all of the Commitments
have been terminated and all LCs have terminated or expired, (b) none of the
Lenders is obligated any longer under this Agreement to make any Loans or issue
any LCs, and (c) all Obligations (other than obligations which survive as
provided in the following sentence) have been paid and satisfied in full, this
Agreement shall terminate. Notwithstanding any termination of this Agreement, or
of the other Loan Documents, the indemnities to which Administrative Agent and
the Lenders are entitled under the provisions of SECTIONS 11.5, 12.2, and 12.8
and any other provision of this Agreement and the other Loan Documents, and the
waivers of jury trial and submission to jurisdiction contained in SECTION 12.3,
shall continue in full force and effect and shall protect Administrative Agent
and the Lenders against events arising after such termination as well as before.
12.10 SEVERABILITY OF PROVISIONS. Any provision of this Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions or affecting the validity or enforceability of such
provision in any other jurisdiction.
12.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
12.12 COUNTERPARTS. This Agreement and any amendments, waivers,
consents or supplements may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all of which
counterparts together shall constitute but one and the same instrument.
12.13 ENTIRETY. THE RIGHTS AND OBLIGATIONS OF BORROWER AND ITS
SUBSIDIARIES, LENDERS, AND ADMINISTRATIVE AGENT SHALL BE DETERMINED SOLELY FROM
WRITTEN AGREEMENTS, DOCUMENTS, AND INSTRUMENTS, AND ANY PRIOR ORAL AGREEMENTS
BETWEEN SUCH PARTIES ARE SUPERSEDED BY AND MERGED INTO SUCH WRITINGS. THIS
AGREEMENT (AS AMENDED IN WRITING FROM TIME TO TIME) AND THE OTHER WRITTEN LOAN
DOCUMENTS EXECUTED BY BORROWER OR ANY OF ITS SUBSIDIARIES, ANY LENDER, AND/OR
ADMINISTRATIVE AGENT, (TOGETHER WITH ALL COMMITMENT
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
70
76
LETTERS AND FEE LETTERS ONLY AS THEY RELATE TO THE PAYMENT OF FEES AFTER THE
CLOSING DATE) REPRESENT THE FINAL AGREEMENT BETWEEN BORROWER AND ITS
SUBSIDIARIES, LENDERS, AND ADMINISTRATIVE AGENT,AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BY SUCH
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN SUCH PARTIES.
12.14 CONSTRUCTION. Administrative Agent, Borrower, and each Lender
acknowledge that each of them has had the benefit of legal counsel of its own
choice and has been afforded an opportunity to review this Agreement and the
other Loan Documents with its legal counsel and that this Agreement and the
other Loan Documents shall be construed as if jointly drafted by Administrative
Agent, the other Agents, Borrower, and each Lender.
12.15 DISCHARGE ONLY UPON PAYMENT IN FULL; REINSTATEMENT IN CERTAIN
CIRCUMSTANCES. The obligations of Borrower and each Subsidiary under the Loan
Documents shall remain in full force and effect until termination of the
Commitments and payment in full of the Loans and of all interest, fees, and
other amounts of the Obligations then due and owing (and termination or
expiration of all outstanding LCs, if any, unless Administrative Agent shall
otherwise consent),except that SECTIONS 4, 11, and 12, and any other provisions
under the Loan Documents expressly intended to survive by the terms hereof or by
the terms of the applicable Loan Documents, shall survive such termination. If
at any time any payment of the principal of or interest on any Note or any other
amount payable by Borrower or its Subsidiaries under any Loan Document is
rescinded or must be otherwise restored or returned upon the insolvency,
bankruptcy, or reorganization of such entity or otherwise, the obligations of
such entity under the Loan Documents with respect to such payment shall be
reinstated as though such payment had been due but not made at such time.
12.16 RESTATEMENT OF EXISTING AGREEMENT. The parties hereto agree that,
on the Effective Date, after all conditions precedent set forth in SECTION 5.1
have been satisfied or waived: (a) the Obligations (as defined in this
Agreement) represent, among other things, the restatement, renewal, amendment,
extension, and modification of the "Obligations" (as defined in the Existing
Agreement); (b) this Agreement is intended to, and does hereby, restate, renew,
extend, amend, modify, supersede, and replace the Existing Agreement in its
entirety; (c) the Notes, if any, executed pursuant to this Agreement amend,
renew, extend, modify, replace, restate, substitute for, and supersede in their
entirety (but do not extinguish, the Debt arising under) the promissory notes
issued pursuant to the Existing Agreement, which existing promissory notes shall
be returned to Administrative Agent promptly after the Effective Date,
marked "canceled and replaced," and, thereafter, delivered by Administrative
Agent or each such Lender to Borrower; and (d) the entering into and performance
of their respective obligations under the Loan Documents and the transactions
evidenced hereby do not constitute a novation nor shall they be deemed to have
terminated, extinguished, or discharged the indebtedness under the Existing
Agreement, all of which indebtedness shall continue under and be governed by
this Agreement and the other Loan Documents, except as expressly provided
otherwise herein. On the Effective Date, (i) all outstanding Indebtedness under
the Existing Agreement owed to any "Lender" that is not continuing as a Lender
under this Agreement (each a "NON-CONTINUING LENDER") shall be repaid in full by
Borrower and such Non-Continuing Lender's commitment under the Existing
Agreement shall be terminated and (ii) with respect to Existing Lenders which
are continuing as Lenders under this Agreement (the "CONTINUING LENDERS"),
Administrative Agent shall make appropriate allocations and adjustments in the
initial funding instructions to the Lenders to reflect the modifications
effected by the Loan Documents to each Continuing Lender's Commitment and
Commitment Percentage.
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
71
77
REMAINDER OF PAGE INTENTIONALLY BLANK.
SIGNATURE PAGES FOLLOW.
ALLIED AMENDED AND RESTATED CREDIT AGREEMENT
72
78
SCHEDULE 2
LENDERS AND COMMITMENTS
------------------------------------------------------------------------------------------------------------
REVOLVING
FACILITY COMMITMENT UPFRONT
NAME AND ADDRESS OF LENDERS COMMITTED PERCENTAGE FEE
SUMS
------------------------------------------------------------------------------------------------------------
Bank of America, N.A. $52,500,000.00 12.574850% $52,500.00
Financial Services
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇.▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
Fleet National Bank $50,000,000.00 11.976048% $50,000.00
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Mail Stop 01-10-08
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇_▇_▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
First Union National Bank $50,000,000.00 11.976048% $50,000.00
One First ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇.▇▇▇▇▇▇@▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
▇▇▇▇▇ Bank N.A. $50,000,000.00 11.976048% $50,000.00
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇_▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
AMENDED AND RESTATED CREDIT AGREEMENT - SCHEDULE 2
79
------------------------------------------------------------------------------------------------------------
REVOLVING
FACILITY COMMITMENT UPFRONT
NAME AND ADDRESS OF LENDERS COMMITTED PERCENTAGE FEE
SUMS
------------------------------------------------------------------------------------------------------------
Chevy Chase Bank, F.S.B. $30,000,000.00 7.185629% $30,000.00
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
Credit Lyonnais New York Branch $40,000,000.00 9.580838% $50,000.00
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: W. ▇▇▇ ▇▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
Branch Banking & Trust Co. $40,000,000.00 9.580838% $50,000.00
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇-▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
Deutsche Bank AG, New York Branch $30,000,000.00 7.185629% $40,000.00
▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
LaSalle Bank National Association $20,000,000.00 4.790419% $20,000.00
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
AMENDED AND RESTATED CREDIT AGREEMENT - SCHEDULE 2
2
80
------------------------------------------------------------------------------------------------------------
REVOLVING
FACILITY COMMITMENT UPFRONT
NAME AND ADDRESS OF LENDERS COMMITTED PERCENTAGE FEE
SUMS
------------------------------------------------------------------------------------------------------------
Mercantile-Safe Deposit & Trust Company $25,000,000.00 5.988024% $27,500.00
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
U.S. Bank National Association $20,000,000.00 4.790419% $20,000.00
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
Firstrust Bank $10,000,000.00 2.395210% $10,625.00
▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
------------------------------------------------------------------------------------------------------------
Totals $417,500,000.00 100.000000% $450,625.00
------------------------------------------------------------------------------------------------------------
AMENDED AND RESTATED CREDIT AGREEMENT - SCHEDULE 2
3
81
SCHEDULE 6.1(a)
QUALIFICATION
No representations or warranties are made under Section 6.1(a) as to the
following Subsidiary:
Allied Capital Beteiligungsberatung GmbH
AMENDED AND RESTATED CREDIT AGREEMENT - SCHEDULE 6.1(a)
82
SCHEDULE 6.1(b)
OWNERSHIP STRUCTURE
1. CONSOLIDATED SUBSIDIARIES.
------------------------------------------------------------------------------------------------------------
PERCENTAGE OF
VOTING STOCK
JURISDICTION OF OWNED BY
NAME OF SUBSIDIARY INCORPORATION BORROWER AND
EACH OTHER
SUBSIDIARY
------------------------------------------------------------------------------------------------------------
Allied Investment Corporation Maryland 100%
Allied Investment Holdings LLC Delaware 100%
Allied Capital SBLC Corporation Maryland 100%
Allied Capital SBLC Holdings LLC Delaware 100%
Allied Capital Holdings LLC Delaware 100%
Allied Capital REIT, Inc. Maryland 100%
Allied Capital Property LLC Delaware 100%
Allied Capital Equity LLC Delaware 100%
▇▇▇▇ ▇-▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ Delaware 100%
80504 LLC
Allied Capital Beteiligungsberatung GmbH Republic of Germany 100%
2. UNCONSOLIDATED SUBSIDIARIES.
------------------------------------------------------------------------------------------------------------
PERCENTAGE OF
VOTING STOCK
JURISDICTION OF OWNED BY
NAME OF SUBSIDIARY INCORPORATION BORROWER AND
EACH OTHER
SUBSIDIARY
------------------------------------------------------------------------------------------------------------
Allied Capital Commercial Mortgage Trust 1998-1 Delaware 100%
Allied Capital Funding LLC Delaware 100%
Allied Capital Syndication LLC Delaware 100%
Allied Capital CMT, Inc. Delaware 100%
AMENDED AND RESTATED CREDIT AGREEMENT - SCHEDULE 6.1(b)
83
SCHEDULE 6.1(g)
INDEBTEDNESS
1. Allied Capital Corporation, TIAA, Lincoln, Hancock, Sun America, Mass
Mutual, American General, Allstate, Nationwide, ▇▇▇▇▇▇ Brothers, Swiss
Reinsurance Group and GE Financial - Note Agreement dated April 30,
1998, in the outstanding principal amount of $180,000,000.
2. Allied Capital Corporation, ▇▇▇▇▇▇▇, Sun America, CIGNA, Ohio National,
TIAA, GE Financial, Nationwide, Zurich and Berkshire - Note Agreement
dated May 1, 1999, in the outstanding principal amount of $137,000,000.
3. Allied Capital Corporation, Advantus, Allstate, ▇▇▇▇▇▇▇, Guardian,
CIGNA, GE Financial, ▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇, Nationwide and ▇▇▇▇▇▇▇ -
Note Agreement dated November 15, 1999, in the outstanding principal
amount of $102,000,000.
4. Allied Capital Corporation and Overseas Private Investment Corporation
- Loan Agreement dated April 10, 1995, as amended, in an aggregate
principal amount up to $20,000,000.
5. Debentures issued by Allied Investment Corporation, and held by the
U.S. Small Business Administration, in the outstanding principal amount
of $74,650,000.
6. Redeemable preferred stock issued by Allied Investment Corporation, and
held by the U.S. Small Business Administration, in the outstanding
principal amount of $7,000,000.
7. Allied Capital Corporation and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital, Inc. - Second
Amended and Restated Master Loan and Security Agreement dated as of
October 28, 1999, as amended, in an aggregate principal amount up to
$100,000,000 (collateralized by Liens on multifamily and commercial
mortgage loans and the documents related thereto including, without
limitation, promissory notes, servicing agreements, mortgage guaranties
and insurance, loan files, documents, and instruments, as well as all
general intangibles and replacements, substitutions, distributions on
or proceeds from any of the foregoing).
8. Allied Investment Corporation Demand Note Payable to Allied Capital
Corporation in an aggregate principal amount up to $25,000,000.
9. Allied Capital SBLC Corporation Demand Note Payable to Allied Capital
Corporation in an aggregate principal amount up to $75,000,000.
10. Allied Capital Equity, LLC Demand Note Payable to Allied Capital
Corporation in an aggregate principal amount up to $1,000,000.
11. Allied Capital Corporation Irrevocable Letter of Credit dated July 7,
1999 for the benefit of Fleet National Bank, formerly known as
BankBoston N.A., in the amount of $412,464.
AMENDED AND RESTATED CREDIT AGREEMENT - SCHEDULE 6.1(g)
84
SCHEDULE 6.1(h)
MATERIAL CONTRACTS
Borrower has no Material Contracts other than agreements and instruments listed
as Number 1 through 7 set forth on Schedule 6.1(g) relating to Indebtedness of
Borrower or its Subsidiaries.
AMENDED AND RESTATED CREDIT AGREEMENT - SCHEDULE 6.1(h)