EXECUTION COPY
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AMENDED AND RESTATED CREDIT AGREEMENT
dated as of
May 8, 2007
among
Nelnet, Inc.
The Lenders Party Hereto,
JPMorgan Chase Bank, N.A.,
as Administrative Agent
and
Citibank, N.A.,
as Syndication Agent
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▇.▇. ▇▇▇▇▇▇ Securities Inc.
Sole Lead Arranger
and Bookrunner
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TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS
Section 1.01. DEFINED TERMS...................................................1
Section 1.02. CLASSIFICATION OF LOANS AND BORROWINGS.........................13
Section 1.03. TERMS GENERALLY................................................13
Section 1.04. ACCOUNTING TERMS; GAAP.........................................14
ARTICLE 2
THE CREDITS
Section 2.01. COMMITMENTS....................................................14
Section 2.02. LOANS AND BORROWINGS...........................................14
Section 2.03. REQUESTS FOR BORROWINGS........................................15
Section 2.04. FUNDING OF BORROWINGS..........................................16
Section 2.05. INTEREST ELECTIONS.............................................16
Section 2.06. TERMINATION AND REDUCTION OF COMMITMENTS.......................18
Section 2.07. REPAYMENT OF LOANS; EVIDENCE OF DEBT...........................18
Section 2.08. PREPAYMENT OF LOANS............................................19
Section 2.09. FEES...........................................................19
Section 2.10. INTEREST.......................................................20
Section 2.11. ALTERNATE RATE OF INTEREST.....................................21
Section 2.12. INCREASED COSTS................................................21
Section 2.13. BREAK FUNDING PAYMENTS.........................................22
Section 2.14. TAXES..........................................................22
Section 2.15. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS....24
Section 2.16. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.................25
Section 2.17. INCREASED COMMITMENTS; ADDITIONAL LENDERS......................26
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
Section 3.01. ORGANIZATION; POWERS...........................................27
Section 3.02. AUTHORIZATION; ENFORCEABILITY..................................27
Section 3.03. GOVERNMENTAL APPROVALS; NO CONFLICTS...........................28
Section 3.04. FINANCIAL CONDITION; NO MATERIAL ADVERSE CHANGE................28
Section 3.05. PROPERTIES.....................................................28
Section 3.06. LITIGATION AND ENVIRONMENTAL MATTERS...........................28
Section 3.07. COMPLIANCE WITH LAWS AND AGREEMENTS............................29
Section 3.08. INVESTMENT AND HOLDING COMPANY STATUS..........................29
Section 3.09. TAXES..........................................................29
Section 3.10. ERISA..........................................................29
Section 3.11. DISCLOSURE.....................................................29
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ARTICLE 4
CONDITIONS
Section 4.01. EFFECTIVE DATE.................................................30
Section 4.02. EACH BORROWING.................................................31
ARTICLE 5
AFFIRMATIVE COVENANTS
Section 5.01. FINANCIAL STATEMENTS; RATINGS CHANGE AND OTHER INFORMATION.....32
Section 5.02. NOTICES OF MATERIAL EVENTS.....................................33
Section 5.03. EXISTENCE; CONDUCT OF BUSINESS.................................34
Section 5.04. PAYMENT OF OBLIGATIONS.........................................34
Section 5.05. MAINTENANCE OF PROPERTIES; INSURANCE...........................34
Section 5.06. BOOKS AND RECORDS; INSPECTION RIGHTS...........................34
Section 5.07. COMPLIANCE WITH LAWS...........................................34
Section 5.08. USE OF PROCEEDS................................................34
ARTICLE 6
NEGATIVE COVENANTS
Section 6.01. LIENS...........................................................35
Section 6.02. FUNDAMENTAL CHANGES............................................36
Section 6.03. MINIMUM CONSOLIDATED NET WORTH.................................36
Section 6.04. ADJUSTED EBITDA TO CORPORATE DEBT INTEREST.....................36
Section 6.05. SUBSIDIARY INDEBTEDNESS........................................36
Section 6.06. NON-FFELP LOANS TO ALL LOANS...................................36
ARTICLE 7
EVENTS OF DEFAULT
ARTICLE 8
THE ADMINISTRATIVE AGENT
ii
ARTICLE 9
MISCELLANEOUS
Section 9.01. NOTICES........................................................41
Section 9.02. WAIVERS; AMENDMENTS............................................42
Section 9.03. EXPENSES; INDEMNITY; DAMAGE WAIVER.............................43
Section 9.04. SUCCESSORS AND ASSIGNS.........................................44
Section 9.05. SURVIVAL.......................................................47
Section 9.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS.......................47
Section 9.07. SEVERABILITY...................................................48
Section 9.08. RIGHT OF SETOFF................................................48
Section 9.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS.....48
Section 9.10. WAIVER OF JURY TRIAL...........................................49
Section 9.11. HEADINGS.......................................................49
Section 9.12. CONFIDENTIALITY................................................49
Section 9.13. USA PATRIOT ACT................................................50
SCHEDULES:
Commitment Schedule
Pricing Schedule
Schedule 3.06 - Disclosed Matters
Schedule 6.01 - Existing Liens
Schedule 6.04 - Eligible Securities
EXHIBITS:
Exhibit A - Form of Assignment and Assumption
Exhibit B - Form of Opinion of Borrower's Counsel
Exhibit C - Form of Opinion of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
Exhibit D - Form of Compliance Certificate
iii
AMENDED AND RESTATED CREDIT AGREEMENT dated as of May 8, 2007, among
NELNET, INC., the LENDERS party hereto, JPMORGAN CHASE BANK, N.A., as
Administrative Agent, and CITIBANK, N.A., as Syndication Agent.
WHEREAS, certain of the parties hereto have heretofore entered into a
Credit Agreement dated as of August 19, 2005 (the "EXISTING AGREEMENT");
WHEREAS, at the date hereof, there are no Loans outstanding under the
Existing Agreement; and
WHEREAS, the parties hereto desire to amend the Existing Agreement as
set forth herein and to restate the Existing Agreement in its entirety to read
as set forth below;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. DEFINED TERMS. As used in this Agreement, the following
terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"ADJUSTED EBITDA" means, for any period, an amount equal to Pre-Tax
Income for such period, PLUS, (a) without duplication and to the extent deducted
in determining Pre-Tax Income for such period, the sum of (i) the amount of
Corporate Debt Interest for such period, (ii) all amounts attributable to
depreciation and amortization for such period, (iii) the amount of 9.5% excess
statutory yield related to loans previously financed with tax-exempt obligations
issued prior to October 1, 1993 (if negative) and (iv) the derivatives market
value adjustment for such period (if negative), MINUS, (b) without duplication
and to the extent added in determining Pre-Tax Income for such period, the sum
of (i) the amount of variable-rate floor income during such period, (ii) the
amount of 9.5% excess statutory yield related to loans previously financed with
tax-exempt obligations issued prior to October 1, 1993 (if positive) and (iii)
the derivatives market value adjustment for such period (if positive).
"ADJUSTED LIBO RATE" means, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.
1
"ADMINISTRATIVE AGENT" means JPMorgan Chase Bank, N.A., in its capacity
as administrative agent for the Lenders hereunder.
"ADMINISTRATIVE QUESTIONNAIRE" means an Administrative Questionnaire in
a form supplied by the Administrative Agent.
"AFFILIATE" means, with respect to a specified Person, another Person
that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"AGREEMENT" means the Existing Agreement, including the Schedules and
Exhibits thereto, as amended by this Amended Agreement, and as the same may be
further amended from time to time after the date hereof.
"ALTERNATE BASE RATE" means, for any day, a rate per annum equal to the
greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. Any change in the Alternate
Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate
shall be effective from and including the effective date of such change in the
Prime Rate or the Federal Funds Effective Rate, respectively.
"AMENDED AGREEMENT" means this Amended and Restated Credit Agreement
dated as of May 8, 2007.
"APPLICABLE PERCENTAGE" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments.
"APPROVED FUND" has the meaning assigned to such term in Section 9.04.
"ASSIGNMENT AND ASSUMPTION" means an assignment and assumption entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in the form
of Exhibit A or any other form approved by the Administrative Agent.
"AVAILABILITY PERIOD" means the period from and including the Effective
Date to but excluding the earlier of the Maturity Date and the date of
termination of the Commitments.
"BOARD" means the Board of Governors of the Federal Reserve System of
the United States of America.
"BORROWER" means Nelnet, Inc., a Nebraska corporation.
2
"BORROWING" means Loans of the same Type, made, converted or continued
on the same date and, in the case of Eurodollar Loans, as to which a single
Interest Period is in effect.
"BORROWING REQUEST" means a request by the Borrower for a Borrowing in
accordance with Section 2.03.
"BUSINESS DAY" means any day that is not a Saturday, Sunday or other day
on which commercial banks in New York City are authorized or required by law to
remain closed; PROVIDED that, when used in connection with a Eurodollar Loan,
the term "BUSINESS DAY" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"CAPITAL LEASE OBLIGATIONS" of any Person means the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.
"CHANGE IN CONTROL" means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof) other than
the Existing Control Persons, of Equity Interests representing more than 30% of
the aggregate ordinary voting power represented by the issued and outstanding
Equity Interests of the Borrower, but only if at the time the Existing Control
Persons do not beneficially own Equity Interests representing a majority in
voting power of all issued and outstanding Equity Interests of the Borrower; (b)
occupation of a majority of the seats (other than vacant seats) on the board of
directors of the Borrower by Persons who were neither (i) nominated by the board
of directors of the Borrower nor (ii) appointed by directors so nominated; or
(c) the acquisition of direct or indirect Control of the Borrower by any Person
or group (other than the Existing Control Persons).
"CHANGE IN LAW" means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender (or, for
purposes of Section 2.12(b), by any lending office of such Lender or by such
Lender's holding company, if any) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or
issued after the date of this Agreement.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time.
3
"COMMITMENT" means, with respect to each Lender, the commitment of such
Lender to make Loans hereunder, expressed as an amount representing the maximum
aggregate amount of such Lender's Credit Exposure hereunder, as such commitment
may be (a) reduced from time to time pursuant to Section 2.06 and (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.04. The initial amount of each Lender's Commitment is set
forth on the Commitment Schedule, or in the Assignment and Assumption pursuant
to which such Lender shall have assumed its Commitment, as applicable. The
aggregate amount of the Lenders' Commitments at the Effective Date is
$750,000,000.
"COMMITMENT SCHEDULE" means the Commitment Schedule attached hereto.
"CONSOLIDATED NET INCOME" means, for any fiscal period, the net income
of the Borrower and its Consolidated Subsidiaries, determined on a consolidated
basis for such period, PLUS to the extent deducted in determining such net
income, the derivatives market value adjustment for such period (if negative)
and MINUS to the extent added in determining such net income, the derivatives
market value adjustment for such period (if positive).
"CONSOLIDATED NET WORTH" means at any date the sum of (i) the
consolidated stockholders' equity of the Borrower and its Consolidated
Subsidiaries plus (ii) the amount of Hybrid Securities, all determined as of
such date.
"CONSOLIDATED SUBSIDIARY" means at any date any entity the accounts of
which would be consolidated with those of the Borrower in its consolidated
financial statements if such statements were prepared as of such date.
"CONTROL" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"CONTROLLING" and "CONTROLLED" have meanings correlative thereto.
"CORPORATE DEBT INTEREST" means, for any period, the interest expense of
the Borrower on a parent-only basis for such period (exclusive of interest
expense in respect of Hybrid Securities).
"CREDIT EXPOSURE" means, with respect to any Lender at any time, the sum
of the outstanding principal amount of such Lender's Loans at such time.
"DEFAULT" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"DISCLOSED MATTERS" means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.06.
4
"DOLLARS" or "$" refers to lawful money of the United States of America.
"EFFECTIVE DATE" means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).
"ELIGIBLE ASSETS" means (i) Eligible Securities and (ii) any other
assets which would be properly presented on a consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries as "student loans receivable", "cash
and cash equivalents", "accrued interest receivable" or "accounts receivable".
"ELIGIBLE SECURITIES" means the securities set forth on Schedule 6.04.
"ENVIRONMENTAL LAWS" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"ENVIRONMENTAL LIABILITY" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"EQUITY INTERESTS" means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, and any warrants, options
or other rights entitling the holder thereof to purchase or acquire any such
equity interest.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
5
"ERISA EVENT" means (a) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30 day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"EURODOLLAR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Adjusted LIBO Rate.
"EURODOLLAR MARGIN" has the meaning set forth in the Pricing Schedule.
"EVENT OF DEFAULT" has the meaning assigned to such term in Article 7.
"EXCLUDED TAXES" means, with respect to the Administrative Agent, any
Lender, or any other recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder, (a) taxes, duties, levies, imposts,
deductions, charges or withholdings imposed on or measured by net income,
profits (including taxes in the nature of branch profit taxes) or overall gross
receipts and franchise or similar taxes imposed by a jurisdiction under the laws
of which such Lender or Administrative Agent (as the case may be) is organized
or resident or in which its principal executive office is located or in which
applicable lending office is located or with which the Administrative Agent or
Lender has any other connection (other than a connection that is deemed to arise
solely by reason of BOTH (i) the transactions contemplated by this Agreement and
(ii) the Borrower or a Subsidiary being organized, maintaining an office in,
conducting business in, or having a connection with, such jurisdiction) and (b)
in the case of a Foreign Lender (other than an assignee pursuant to a request by
the Borrower under Section 2.12), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender's failure to comply with Section 2.14, except to the extent
that such Foreign Lender (or its assignor, if any) was entitled, at the time of
designation of a new lending office (or assignment), to receive additional
amounts from the Borrower with respect to such withholding tax pursuant to
Section 2.14.
6
"EXISTING CONTROL PERSONS" means ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇▇▇, the members of their immediate families (parents, siblings,
children and spouses) and any trust created for the benefit of any of the
foregoing.
"FACILITY FEE RATE" has the meaning set forth in the Pricing Schedule.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, the weighted average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"FINANCIAL OFFICER" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"FOREIGN LENDER" means any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"GAAP" means generally accepted accounting principles in the United
States of America.
"GOVERNMENTAL AUTHORITY" means the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"GUARANTEE" of or by any Person (the "GUARANTOR") means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the "PRIMARY OBLIGOR") in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.
7
"HAZARDOUS MATERIALS" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"HYBRID SECURITIES" means (i) that portion (75% at the date of this
Agreement) of the $200,000,000 aggregate principal amount of Junior Subordinated
Hybrid Securities of the Borrower issued on September 27, 2006 that would be
included in a determination by Moody's of the Borrower's consolidated net worth
under the applicable procedures and guidelines of such rating agency and (ii)
that portion of any additional Junior Subordinated Hybrid Securities of the
Borrower which may be issued after the Effective Date on terms substantially
similar to the securities described in clause (i) that would be included in a
determination by Moody's of the Borrower's consolidated net worth under the
applicable procedures and guidelines of such rating agency; PROVIDED that the
aggregate principal amount of Hybrid Securities for purposes of computations
hereunder shall at no time exceed $300,000,000.
"INDEBTEDNESS" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed, (g) all Guarantees by such Person of
Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"INDEMNIFIED TAXES" means Taxes other than Excluded Taxes.
8
"INFORMATION MEMORANDUM" means the Confidential Information Memorandum
dated April, 2007 relating to the Borrower and the Transactions.
"INTERCOMPANY INDEBTEDNESS" means Indebtedness of any Subsidiary to the
Borrower or any other Subsidiary.
"INTEREST ELECTION REQUEST" means a request by the Borrower to convert
or continue a Borrowing in accordance with Section 2.05.
"INTEREST PAYMENT DATE" means (a) with respect to any ABR Loan, the last
day of each March, June, September and December and (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing
of which such Loan is a part and, in the case of a Eurodollar Borrowing with an
Interest Period of more than three months' duration, each day prior to the last
day of such Interest Period that occurs at intervals of three months' duration
after the first day of such Interest Period.
"INTEREST PERIOD" means with respect to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or six months
thereafter, as the Borrower may elect. For purposes hereof, the date of a
Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.
"LENDERS" means the Persons listed on the Commitment Schedule and any
other Person that shall have become a party hereto pursuant to an Assignment and
Assumption, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Assumption.
"LIBO RATE" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Dow ▇▇▇▇▇ Market Service
(or on any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO RATE" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
9
"LIEN" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities (unless such option, call or similar right is granted in connection
with a merger, acquisition, divestiture or similar transaction).
"LOANS" means the loans made by the Lenders to the Borrower pursuant to
this Agreement.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, assets, operations, prospects or condition, financial or otherwise, of
the Borrower and the Subsidiaries taken as a whole, (b) the ability of the
Borrower to perform any of its obligations under this Agreement or (c) the
rights of or benefits available to the Lenders under this Agreement.
"MATERIAL INDEBTEDNESS" means Indebtedness (other than the Loans), or
obligations in respect of one or more Swap Agreements, of any one or more of the
Borrower and its Subsidiaries in an aggregate principal amount exceeding
$25,000,000. For purposes of determining Material Indebtedness, the "PRINCIPAL
AMOUNT" of the obligations of the Borrower or any Subsidiary in respect of any
Swap Agreement at any time shall be the maximum aggregate amount (giving effect
to any netting agreements) that the Borrower or such Subsidiary would be
required to pay if such Swap Agreement were terminated at such time.
"MATURITY DATE" means May 8, 2012.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc.
"MULTIEMPLOYER PLAN" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"NON-FFELP LOANS" means student loans not originated under the Federal
Family Education Loan Program of the U.S. Department of Education.
"OTHER TAXES" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement.
"PARTICIPANT" has the meaning set forth in Section 9.04.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
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"PERMITTED ENCUMBRANCES" means:
(a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 5.04;
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
and other like Liens imposed by law, arising in the ordinary course of business
and securing obligations that are not overdue by more than 30 days or are being
contested in compliance with Section 5.04;
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other social
security laws or regulations;
(d) deposits to secure the performance of bids, trade contracts, leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of business;
(e) judgment liens in respect of judgments that do not constitute an
Event of Default under clause (k) of Article 7; and
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of the Borrower or any Subsidiary;
PROVIDED that the term "PERMITTED ENCUMBRANCES" shall not include any Lien
securing Indebtedness.
"PERSON" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"PLAN" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "EMPLOYER" as defined in Section 3(5) of
ERISA.
"PRE-TAX INCOME" means, for any period, the net income of the Borrower
and its Consolidated Subsidiaries for such period, before income taxes, minority
interests and extraordinary items (if any), determined on a consolidated basis
for such period.
"PRICING SCHEDULE" means the Pricing Schedule attached hereto.
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"PRIME RATE" means the rate of interest per annum publicly announced
from time to time by JPMorgan Chase Bank, N.A. as its prime rate in effect at
its principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"REGISTER" has the meaning set forth in Section 9.04.
"RELATED PARTIES" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"REQUIRED LENDERS" means, at any time, Lenders having Credit Exposures
and unused Commitments representing more than 50% of the sum of the total Credit
Exposures and unused Commitments at such time.
"S&P" means Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"STATUTORY RESERVE RATE" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject for
eurocurrency funding (currently referred to as "EUROCURRENCY LIABILITIES" in
Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute
eurocurrency funding and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under such Regulation D or any comparable
regulation. The Statutory Reserve Rate shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
"SUBSIDIARY" means, with respect to any Person (the "PARENT") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent.
"SUBSIDIARY" means any subsidiary of the Borrower.
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"SWAP AGREEMENT" means any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or
debt instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; PROVIDED that no phantom
stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of
the Borrower or the Subsidiaries shall be a Swap Agreement.
"SYNDICATION AGENT" means Citibank, N.A., in its capacity as Syndication
Agent in respect of this Agreement. Nothing herein shall impose on the
Syndication Agent in such capacity any duty or liability whatsoever.
"TAXES" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"TRANSACTIONS" means the execution, delivery and performance by the
Borrower of this Agreement, the borrowing of Loans and the use of the proceeds
thereof.
"TYPE", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"UNENCUMBERED ASSETS" means, at any date, (a) the consolidated amount of
Eligible Assets of the Borrower and its Consolidated Subsidiaries at such date
which are not subject to any Lien (or are subject to release from any Lien
thereon within 60 days of request of the Borrower, which release is not subject
to any condition that has not been met) less (b) the aggregate principal amount
of unsecured Indebtedness of Consolidated Subsidiaries (other than Intercompany
Indebtedness) at such date.
"WITHDRAWAL LIABILITY" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. CLASSIFICATION OF LOANS AND BORROWINGS. For purposes of
this Agreement, Loans and Borrowings may be classified and referred to by Type
(e.g., a "Eurodollar Loan" or a "ABR Borrowing").
SECTION 1.03. TERMS GENERALLY. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
13
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
Section 1.04. ACCOUNTING TERMS; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; PROVIDED
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
ARTICLE 2
THE CREDITS
SECTION 2.01. COMMITMENTS. Subject to the terms and conditions set forth
herein, each Lender agrees to make Loans to the Borrower from time to time
during the Availability Period in an aggregate principal amount that will not
result in such Lender's Credit Exposure exceeding such Lender's Commitment.
Within the foregoing limits and subject to the terms and conditions set forth
herein, the Borrower may borrow, prepay and reborrow Loans.
SECTION 2.02. LOANS AND BORROWINGS. (a) Each Loan shall be made as part
of a Borrowing consisting of Loans made by the Lenders ratably in accordance
with their respective Commitments. The failure of any Lender to make any Loan
required to be made by it shall not relieve any other Lender of its obligations
hereunder; PROVIDED that the Commitments of the Lenders are several and no
Lender shall be responsible for any other Lender's failure to make Loans as
required.
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(b) Subject to Section 2.11, each Borrowing shall be comprised entirely
of ABR Loans or Eurodollar Loans as the Borrower may request in accordance
herewith. Each Lender at its option may make any Eurodollar Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan;
PROVIDED that any exercise of such option shall not affect the obligation of the
Borrower to repay such Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of $1,000,000 and not less than $5,000,000. At the time that each ABR
Borrowing is made, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $1,000,000; PROVIDED that an
ABR Borrowing may be in an aggregate amount that is equal to the entire unused
balance of the total Commitments. Borrowings of more than one Type may be
outstanding at the same time; PROVIDED that there shall not at any time be more
than a total of 10 Eurodollar Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request, or to elect to convert or continue, any
Borrowing if the Interest Period requested with respect thereto would end after
the Maturity Date.
SECTION 2.03. REQUESTS FOR BORROWINGS. To request a Borrowing, the
Borrower shall notify the Administrative Agent of such request by telephone (a)
in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of the proposed Borrowing or (b) in
the case of an ABR Borrowing, not later than 11:00 a.m., New York City time, one
Business Day before the date of the proposed Borrowing. Each such telephonic
Borrowing Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Borrowing Request
in a form approved by the Administrative Agent and signed by the Borrower. Each
such telephonic and written Borrowing Request shall specify the following
information in compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(iv) in the case of a Eurodollar Borrowing, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by
the definition of the term "INTEREST PERIOD"; and
(v) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.04.
15
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed
to have selected an Interest Period of one month's duration. Promptly following
receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04. FUNDING OF BORROWINGS. Each Lender shall make each Loan to
be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders. The Administrative Agent will make such Loans available
to the Borrower by promptly crediting the amounts so received, in like funds, to
an account of the Borrower maintained with the Administrative Agent in New York
City and designated by the Borrower in the applicable Borrowing Request.
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, the
applicable Lender (and if such Lender fails to do so, then the Borrower) agrees
to pay to the Administrative Agent forthwith on demand such corresponding amount
with interest thereon, for each day from and including the date such amount is
made available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation or (ii) in
the case of the Borrower, the interest rate applicable to ABR Loans. If such
Lender pays such amount to the Administrative Agent, then such amount shall
constitute such Lender's Loan included in such Borrowing.
SECTION 2.05. INTEREST ELECTIONS. (a) Each Borrowing initially shall be
of the Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Borrowing, shall have an initial Interest Period as specified in such
Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing
to a different Type or to continue such Borrowing and, in the case of a
Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in
this Section. The Borrower may elect different options with respect to different
portions of the affected Borrowing, in which case each such portion shall be
allocated ratably among the Lenders holding the Loans comprising such Borrowing,
and the Loans comprising each such portion shall be considered a separate
Borrowing.
16
(b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would be required under Section 2.03 if the Borrower were
requesting a Borrowing of the Type resulting from such election to be made on
the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in a
form approved by the Administrative Agent and signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall specify
the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to
different portions thereof, the portions thereof to be allocated to each
resulting Borrowing (in which case the information to be specified
pursuant to clauses (iii) and (iv) below shall be specified for each
resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing
or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "INTEREST PERIOD".
If any such Interest Election Request requests a Eurodollar Borrowing
but does not specify an Interest Period, then the Borrower shall be deemed to
have selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request
with respect to a Eurodollar Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be continued for an
additional Interest Period of one month. Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so notifies the
Borrower, then, so long as an Event of Default is continuing (i) no outstanding
Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii)
unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing
at the end of the Interest Period applicable thereto.
17
SECTION 2.06. TERMINATION AND REDUCTION OF COMMITMENTS. (a) Unless
previously terminated, the Commitments shall terminate on the Maturity Date.
(b) The Borrower may at any time terminate, or from time to time reduce,
the Commitments; PROVIDED that (i) each reduction of the Commitments shall be in
an amount that is an integral multiple of $5,000,000 and not less than
$25,000,000 and (ii) the Borrower shall not terminate or reduce the Commitments
if, after giving effect to any concurrent prepayment of the Loans in accordance
with Section 2.08, the sum of the Credit Exposures would exceed the total
Commitments.
(c) The Borrower shall notify the Administrative Agent of any election
to terminate or reduce the Commitments under paragraph (b) of this Section at
least three Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date thereof. Promptly
following receipt of any notice, the Administrative Agent shall advise the
Lenders of the contents thereof. Each notice delivered by the Borrower pursuant
to this Section shall be irrevocable; PROVIDED that a notice of termination of
the Commitments delivered by the Borrower may state that such notice is
conditioned upon the effectiveness of other credit facilities, in which case
such notice may be revoked by the Borrower (by notice to the Administrative
Agent on or prior to the specified effective date) if such condition is not
satisfied. Any termination or reduction of the Commitments shall be permanent.
Each reduction of the Commitments shall be made ratably among the Lenders in
accordance with their respective Commitments.
SECTION 2.07. REPAYMENT OF LOANS; EVIDENCE OF DEBT. (a) The Borrower
hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Loan on the
Maturity Date.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
(c) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each Loan made hereunder, the Type thereof and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder for the account of the Lenders and each Lender's share thereof.
18
(d) The entries made in the accounts maintained pursuant to paragraph
(b) or (c) of this Section shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; PROVIDED that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay
the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note payable to the order of such Lender (or, if
requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).
SECTION 2.08. PREPAYMENT OF LOANS. (a) The Borrower shall have the right
at any time and from time to time to prepay any Borrowing in whole or in part,
subject to prior notice in accordance with paragraph (b) of this Section.
(b) The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of prepayment, or (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time,
one Business Day before the date of prepayment. Each such notice shall be
irrevocable and shall specify the prepayment date and the principal amount of
each Borrowing or portion thereof to be prepaid; PROVIDED that, if a notice of
prepayment is given in connection with a conditional notice of termination of
the Commitments as contemplated by Section 2.06, then such notice of prepayment
may be revoked if such notice of termination is revoked in accordance with
Section 2.06. Promptly following receipt of any such notice relating to a
Borrowing, the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Borrowing shall be in an amount that
would be permitted in the case of an advance of a Borrowing of the same Type as
provided in Section 2.02. Each prepayment of a Borrowing shall be applied
ratably to the Loans included in the prepaid Borrowing. Prepayments shall be
accompanied by accrued interest to the extent required by Section 2.10.
SECTION 2.09. FEES. (a) The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a facility fee, which shall accrue at the
Facility Fee Rate on the daily amount of the Commitment of such Lender (whether
used or unused) during the period from and including May 8, 2007 to but
excluding the date on which such Commitment terminates; PROVIDED that, if such
Lender continues to have any Credit Exposure after its Commitment terminates,
then such facility fee shall continue to accrue on the daily amount of such
Lender's Credit Exposure from and including the date on which its Commitment
19
terminates to but excluding the date on which such Lender ceases to have any
Credit Exposure. Accrued facility fees shall be payable in arrears on the last
day of March, June, September and December of each year and on the date on which
the Commitments terminate, commencing on the first such date to occur after the
date hereof; PROVIDED that any facility fees accruing after the date on which
the Commitments terminate shall be payable on demand. All facility fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).
(b) The Borrower agrees to pay to the Administrative Agent, for its own
account, fees payable in the amounts and at the times separately agreed upon
between the Borrower and the Administrative Agent.
(c) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent for distribution, in
the case of facility fees, to the Lenders. Fees paid shall not be refundable
under any circumstances.
SECTION 2.10. INTEREST. The Loans comprising each ABR Borrowing shall
bear interest at the Alternate Base Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear interest,
at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing
plus the Eurodollar Margin.
(c) Notwithstanding the foregoing, if any principal of or interest on
any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the
rate otherwise applicable to such Loan as provided in the preceding paragraphs
of this Section or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Loans as provided in paragraph (a) of this Section.
(d) Accrued interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan and upon termination of the Commitments;
PROVIDED that (i) interest accrued pursuant to paragraph (c) of this Section
shall be payable on demand, (ii) in the event of any repayment or prepayment of
any Loan (other than a prepayment of an ABR Loan prior to the end of the
Availability Period), accrued interest on the principal amount repaid or prepaid
shall be payable on the date of such repayment or prepayment and (iii) in the
event of any conversion of any Eurodollar Loan prior to the end of the current
Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a year of
360 days, except that interest computed by reference to the Alternate Base Rate
at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
20
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate or
Adjusted LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.
SECTION 2.11. ALTERNATE RATE OF INTEREST. If prior to the commencement
of any Interest Period for a Eurodollar Borrowing, adequate and reasonable means
do not exist for ascertaining the Adjusted LIBO Rate for such Interest Period,
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective,
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.
SECTION 2.12. INCREASED COSTS. If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender (except any such
reserve requirement reflected in the Adjusted LIBO Rate); or
(ii) impose on any Lender or the London interbank market any
other condition affecting this Agreement or Eurodollar Loans made by
such Lender (other than a Tax, as to which the provisions of Section
2.14 apply);
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan), or to reduce the amount of any sum received
or receivable by such Lender hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender such additional amount or
amounts as will compensate such Lender for such additional costs incurred or
reduction suffered.
(b) If any Change in Law regarding capital requirements has or would
have the effect of reducing the rate of return on any Lender's capital or on the
capital of any Lender's holding company, if any, as a consequence of this
Agreement or the Loans made by such Lender to a level below that which such
Lender or such Lender's holding company could have achieved but for such Change
in Law (taking into consideration such Lender's policies and the policies of
such Lender's holding company with respect to capital adequacy), then from time
to time the Borrower will pay to such Lender such additional amount or amounts
as will compensate such Lender or such Lender's holding company for any such
reduction suffered.
21
(c) A certificate of a Lender setting forth the amount or amounts
necessary to compensate such Lender or its holding company, as the case may be,
as specified in paragraph (a) or (b) of this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender the amount shown as due on any such certificate within 10 days after
receipt thereof.
(d) Failure or delay on the part of any Lender to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender's right to
demand such compensation; PROVIDED that the Borrower shall not be required to
compensate a Lender pursuant to this Section for any increased costs or
reductions incurred more than 180 days prior to the date that such Lender
notifies the Borrower of the Change in Law giving rise to such increased costs
or reductions and of such Lender's intention to claim compensation therefor.
SECTION 2.13. BREAK FUNDING PAYMENTS. In the event of (a) the payment of
any principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default), (b)
the conversion of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or
prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under Section
2.08(b) and is revoked in accordance therewith), or (d) the assignment of any
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.16, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. In the case of a Eurodollar Loan, such
loss, cost or expense to any Lender shall be deemed to include an amount
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBO Rate that would have been applicable to
such Loan, for the period from the date of such event to the last day of the
then current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period for
such Loan), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Lender would
bid were it to bid, at the commencement of such period, for dollar deposits of a
comparable amount and period from other banks in the eurodollar market. A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender the amount shown as due on any such certificate within 10 days after
receipt thereof.
SECTION 2.14. TAXES. Any and all payments by or on account of any
obligation of the Borrower hereunder shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; PROVIDED that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
22
additional sums payable under this Section) the Administrative Agent or Lender
(as the case may be) receives an amount equal to the sum it would have received
had no such deductions been made, (ii) the Borrower shall make such deductions
and (iii) the Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent and each
Lender within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Administrative Agent or such Lender
on or with respect to any payment by or on account of any obligation of the
Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section) and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender, or by the Administrative Agent on its own behalf or on
behalf of a Lender, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the Borrower shall
deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law, such properly completed and executed documentation prescribed by applicable
law or reasonably requested by the Borrower as will permit such payments to be
made without withholding or at a reduced rate.
(f) If the Administrative Agent or a Lender receives a refund of any
Taxes or Other Taxes as to which it has been indemnified by the Borrower or with
respect to which the Borrower has paid additional amounts pursuant to this
Section 2.14, it shall pay over such refund to the Borrower (but only to the
extent of indemnity payments made, or additional amounts paid, by the Borrower
under this Section 2.14 with respect to the Taxes or Other Taxes giving rise to
such refund), net of all out-of-pocket expenses of the Administrative Agent or
such Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided, that the
23
Borrower, upon the request of the Administrative Agent or such Lender, agrees to
repay the amount paid over to the Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
This Section shall not be construed to require the Administrative Agent or any
Lender to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to the Borrower or any other Person.
SECTION 2.15. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF
SET-OFFS. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees, or of amounts payable under
Sections 2.12, 2.13, 2.14 or otherwise) prior to 2:00 p.m., New York City time,
on the date when due, in immediately available funds, without set off or
counterclaim. Any amounts received after such time on any date may, in the
discretion of the Administrative Agent, be deemed to have been received on the
next succeeding Business Day for purposes of calculating interest thereon. All
such payments shall be made to the Administrative Agent at its offices at ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, except that payments pursuant to Sections 2.12,
2.13, 2.14 and 9.03 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.
(b) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, interest and
fees then due hereunder, such funds shall be applied (i) first, towards payment
of interest and fees then due hereunder, ratably among the parties entitled
thereto in accordance with the amounts of interest and fees then due to such
parties, and (ii) second, towards payment of principal then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal then due to such parties.
(c) If any Lender shall, by exercising any right of set off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans resulting in such Lender receiving payment of a
greater proportion of the aggregate amount of its Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Loans of other Lenders to the extent necessary so that the
benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans; PROVIDED that (i) if any such participations are
purchased and all or any portion of the payment giving rise thereto is
24
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by the Borrower pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans to any assignee or
participant, other than to the Borrower or any Subsidiary or Affiliate thereof
(as to which the provisions of this paragraph shall apply). The Borrower
consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders hereunder that the Borrower will not make
such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be made by
it pursuant to Section 2.04(b) or 2.15(d), then the Administrative Agent may, in
its discretion (notwithstanding any contrary provision hereof), apply any
amounts thereafter received by the Administrative Agent for the account of such
Lender to satisfy such Lender's obligations under such Sections until all such
unsatisfied obligations are fully paid.
SECTION 2.16. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS. (a) If any
Lender requests compensation under Section 2.12, or if the Borrower is required
to pay any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.14, then such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the judgment of such
Lender, such designation or assignment (i) would eliminate or reduce amounts
payable pursuant to Section 2.12 or 2.14, as the case may be, in the future and
(ii) would not subject such Lender to any unreimbursed cost or expense and would
not otherwise be disadvantageous to such Lender.
25
(b) If any Lender requests compensation under Section 2.12, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.14,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); PROVIDED that (i) the Borrower
shall have received the prior written consent of the Administrative Agent, which
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and (iii)
in the case of any such assignment resulting from a claim for compensation under
Section 2.12 or payments required to be made pursuant to Section 2.14, such
assignment will result in a reduction in such compensation or payments. A Lender
shall not be required to make any such assignment and delegation if, prior
thereto, as a result of a waiver by such Lender or otherwise, the circumstances
entitling the Borrower to require such assignment and delegation cease to apply.
SECTION 2.17. INCREASED COMMITMENTS; ADDITIONAL LENDERS. (a) From time
to time subsequent to the Effective Date, the Borrower may, upon at least 30
days' notice to the Administrative Agent (which shall promptly provide a copy of
such notice to the Lenders), propose to increase the aggregate amount of the
Commitments to an aggregate amount not to exceed $850,000,000 (the amount of any
such increase, the "INCREASED COMMITMENTS"). Each Lender party to this Agreement
at such time shall have the right (but no obligation), for a period of 15 days
following receipt of such notice, to elect by notice to the Borrower and the
Administrative Agent to increase its Commitment by a principal amount which
bears the same ratio to the Increased Commitments as its then Commitment bears
to the aggregate Commitments then existing.
(b) If any Lender party to this Agreement shall not elect to increase
its Commitment pursuant to subsection (a) of this Section, the Borrower may,
within 10 days of the Lender's response, designate one or more of the existing
Lenders or other financial institutions acceptable to the Administrative Agent
and the Borrower (which consent of the Administrative Agent shall not be
unreasonably withheld) which at the time agree to (i) in the case of any such
Person that is an existing Lender, increase its Commitment and (ii) in the case
of any other such Person (an "ADDITIONAL LENDER"), become a party to this
Agreement as a Lender. The sum of the increases in the Commitments of the
existing Lenders pursuant to this subsection (b) plus the Commitments of the
Additional Lenders shall not in the aggregate exceed the unsubscribed amount of
the Increased Commitments.
26
(c) An increase in the aggregate amount of the Commitments pursuant to
this Section 2.17 shall become effective upon the receipt by the Administrative
Agent of an agreement in form and substance satisfactory to the Administrative
Agent signed by the Borrower by each Additional Lender and by each other Lender
whose Commitment is to be increased, setting forth the new Commitments of such
Lenders and setting forth the agreement of each Additional Lender to become a
party to this Agreement as a Lender and to be bound by all the terms and
provisions hereof, together with such evidence of appropriate corporate
authorization on the part of the Borrower with respect to the Increased
Commitments and such opinions of counsel for the Borrower with respect to the
Increased Commitments as the Administrative Agent may reasonably request.
(d) Upon any increase in the aggregate amount of the Commitments
pursuant to this Section 2.17 that is not pro rata among all Lenders, (x) within
five Domestic Business Days, in the case of any ABR Borrowing then outstanding,
and (y) at the end of the then current Interest Period with respect thereto, in
the case of any Eurodollar Borrowing then outstanding, the Borrower shall prepay
such Borrowing in its entirety and, to the extent the Borrower elects to do so
and subject to the conditions specified in Article 4 the Borrower shall reborrow
Loans from the Lenders in proportion to their respective Commitments after
giving effect to such increase, until such time as all outstanding Loans are
held by the Lenders in such proportion.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. ORGANIZATION; POWERS. Each of the Borrower and its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.
SECTION 3.02. AUTHORIZATION; ENFORCEABILITY. The Transactions are within
the Borrower's corporate powers and have been duly authorized by all necessary
corporate and, if required, stockholder action. This Agreement and any
promissory note of the Borrower hereunder have been, or will be, in the case of
any such promissory note executed and delivered hereafter, duly executed and
delivered by the Borrower and constitute, or will constitute, in the case of any
such promissory note executed and delivered hereafter, a legal, valid and
binding obligation of the Borrower, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors' rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.
27
SECTION 3.03. GOVERNMENTAL APPROVALS; NO CONFLICTS. The Transactions (a)
do not require any consent or approval of, registration or filing with, or any
other action by, any Governmental Authority, except such as have been obtained
or made and are in full force and effect, (b) will not violate any applicable
law or regulation or the charter, by-laws or other organizational documents of
the Borrower or any of its Subsidiaries or any order of any Governmental
Authority, (c) will not violate or result in a default under any indenture,
agreement or other instrument binding upon the Borrower or any of its
Subsidiaries or its assets, or give rise to a right thereunder to require any
payment to be made by the Borrower or any of its Subsidiaries, and (d) will not
result in the creation or imposition of any Lien on any asset of the Borrower or
any of its Subsidiaries.
SECTION 3.04. FINANCIAL CONDITION; NO MATERIAL ADVERSE CHANGE. (a) The
Borrower has heretofore furnished to the Lenders its consolidated balance sheet
and statements of income, stockholders equity and cash flows as of and for the
fiscal year ended December 31, 2006, reported on by KPMG LLP, independent public
accountants. Such financial statements present fairly, in all material respects,
the financial position and results of operations and cash flows of the Borrower
and its consolidated Subsidiaries as of such date and for such period in
accordance with GAAP.
(b) Since December 31, 2006, there has been no material adverse change
in the business, assets, operations, prospects or condition, financial or
otherwise, of the Borrower and its Subsidiaries, taken as a whole.
SECTION 3.05. PROPERTIES. (a) Each of the Borrower and its Subsidiaries
has good title to, or valid leasehold interests in, all its real and personal
property material to its business, except for minor defects in title that do not
interfere with its ability to conduct its business as currently conducted or to
utilize such properties for their intended purposes.
(b) Each of the Borrower and its Subsidiaries owns, or is licensed to
use, all trademarks, tradenames, copyrights, patents and other intellectual
property material to its business, and the use thereof by the Borrower and its
Subsidiaries does not infringe upon the rights of any other Person, except for
any such infringements that, individually or in the aggregate, may not
reasonably be expected to result in a Material Adverse Effect.
SECTION 3.06. LITIGATION AND ENVIRONMENTAL MATTERS. There are no
investigations, actions, suits or proceedings by or before any arbitrator or
Governmental Authority pending against or, to the knowledge of the Borrower,
threatened against or affecting the Borrower or any of its Subsidiaries (i) as
to which there is a reasonable possibility of an adverse determination and that,
if adversely determined, may reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters) or (ii) that involve this Agreement or the Transactions.
28
(b) Except with respect to any matters that, individually or in the
aggregate, may not reasonably be expected to result in a Material Adverse
Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to
comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) has
become subject to any Environmental Liability, (iii) has received notice of any
claim with respect to any Environmental Liability or (iv) knows of any basis for
any Environmental Liability.
SECTION 3.07. COMPLIANCE WITH LAWS AND AGREEMENTS. Each of the Borrower
and its Subsidiaries is in compliance with all laws, regulations and orders of
any Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except (i) to
the extent, if any, that the Borrower and its Subsidiaries may not be in such
compliance in connection with the Disclosed Matters or (ii) where the failure to
do so, individually or in the aggregate, may not reasonably be expected to
result in a Material Adverse Effect. No Default has occurred and is continuing.
SECTION 3.08. INVESTMENT AND HOLDING COMPANY STATUS. Neither the
Borrower nor any of its Subsidiaries is an "investment company" as defined in,
or subject to regulation under, the Investment Company Act of 1940.
SECTION 3.09. TAXES. Each of the Borrower and its Subsidiaries has
timely filed or caused to be filed all Tax returns and reports required to have
been filed and has paid or caused to be paid all Taxes required to have been
paid by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which the Borrower or such Subsidiary, as
applicable, has set aside on its books adequate reserves or (b) to the extent
that the failure to do so may not reasonably be expected to result in a Material
Adverse Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, may reasonably be expected to
result in a Material Adverse Effect.
SECTION 3.11. DISCLOSURE. The Borrower has disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which it or any
of its Subsidiaries is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. Neither the Information Memorandum nor any of the other
reports, financial statements, certificates or other information furnished by or
on behalf of the Borrower to the Administrative Agent or any Lender in
connection with the negotiation of this Agreement or delivered hereunder (as
modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; PROVIDED that, with respect to projected financial
information, the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.
29
ARTICLE 4
CONDITIONS
SECTION 4.01. EFFECTIVE DATE. This Amended Agreement shall not become
effective until the date on which each of the following conditions is satisfied
(or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have received from
each party hereto either (i) a counterpart of this Amended Agreement signed on
behalf of such party or (ii) written evidence satisfactory to the Administrative
Agent (which may include telecopy transmission of a signed signature page of
this Amended Agreement) that such party has signed a counterpart of this Amended
Agreement.
(b) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated the
Effective Date) of The Perry Law Firm, counsel for the Borrower, substantially
in the form of Exhibit B, and covering such other matters relating to the
Borrower, this Agreement or the Transactions as the Required Lenders shall
reasonably request. The Borrower hereby requests such counsel to deliver such
opinion.
(c) The Administrative Agent shall have received such documents and
certificates as the Administrative Agent or its counsel may reasonably request
relating to the organization, existence and good standing of the Borrower, the
authorization of the Transactions and any other legal matters relating to the
Borrower, this Agreement or the Transactions, all in form and substance
satisfactory to the Administrative Agent and its counsel.
(d) The Administrative Agent shall have received a certificate, dated
the Effective Date and signed by the President, a Vice President or a Financial
Officer of the Borrower, confirming compliance with the conditions set forth in
paragraphs (a) and (b) of Section 4.02.
(e) The Administrative Agent shall have received all fees and other
amounts due and payable on or prior to the Effective Date, including, to the
extent invoiced, reimbursement or payment of all out of pocket expenses required
to be reimbursed or paid by the Borrower hereunder.
(f) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated the
Effective Date) of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, substantially in the form of Exhibit
C, and covering such other matters relating to the Agreement or the Transactions
as the Required Lenders shall reasonably request.
30
PROVIDED that this Amended Agreement shall not become effective or be
binding on any party hereto unless all of the foregoing conditions are satisfied
not later than May 9, 2007. The Administrative Agent shall promptly notify the
Borrower, the Lenders and each other party to the Existing Agreement of the
Effective Date, and such notice shall be conclusive and binding on all parties
hereto. On the Effective Date, (i) the Existing Agreement shall be automatically
amended and restated in its entirety to read as this Amended Agreement, (ii)
each Person listed on the signature pages hereof which is not a party to the
Existing Agreement shall become a Lender party to this Agreement, (iii) the
Commitment of each Lender shall be the amount set forth opposite the name of
such Lender on the Commitment Schedule and (iv) any Lender party to the Existing
Agreement but not listed in the Commitment Schedule (a "DEPARTING LENDER") shall
cease to be a Lender party to this Agreement and all accrued fees and other
amounts payable under the Existing Agreement for the account of such Departing
Lender shall be due and payable on the Effective Date; provided that the
provisions of Sections 2.12, 2.13, 2.14, and 9.03 of the Existing Agreement
shall continue to inure to the benefit of such Departing Lender. Promptly after
the Effective Date, the Administrative Agent shall deliver to each Lender a copy
of this Amended Agreement including photocopies of counterpart signature pages
signed by each of the parties hereto.
SECTION 4.02. EACH BORROWING. The obligation of each Lender to make a
Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
(a) The representations and warranties of the Borrower set forth in this
Agreement (with the exception, in the case of a Borrowing subsequent to the
Effective Date, of the representations and warranties in Sections 3.04(b) and
Section 3.06) shall be true and correct on and as of the date of such Borrowing.
(b) At the time of and immediately after giving effect to such Borrowing
no Default shall have occurred and be continuing.
Each Borrowing shall be deemed to constitute a representation and
warranty by the Borrower on the date thereof as to the matters specified in
paragraphs (a) and (b) of this Section.
ARTICLE 5
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the principal
of and interest on each Loan and all fees payable hereunder shall have been paid
in full, the Borrower covenants and agrees with the Lenders that:
31
SECTION 5.01. FINANCIAL STATEMENTS; RATINGS CHANGE AND OTHER
INFORMATION. The Borrower will furnish to the Administrative Agent and each
Lender:
(a) within 90 days after the end of each fiscal year of the Borrower,
its audited consolidated balance sheet and related statements of operations,
stockholders' equity and cash flows as of the end of and for such year, setting
forth in each case in comparative form the figures for the previous fiscal year,
all reported on by KPMG LLP or other independent public accountants of
recognized national standing (without a "GOING CONCERN" or like qualification or
exception and without any qualification or exception as to the scope of such
audit) to the effect that such consolidated financial statements present fairly
in all material respects the financial condition and results of operations of
the Borrower and its Consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, its consolidated balance sheet and
related statements of operations, stockholders' equity and cash flows as of the
end of and for such fiscal quarter and the then elapsed portion of the fiscal
year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, all certified by one of its Financial
Officers as presenting fairly in all material respects the financial condition
and results of operations of the Borrower and its Consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to
year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery of financial statements under clause
(a) or (b) above, (i) the balance sheet of the Borrower as of the date of such
financial statements and the related statements of operations, stockholders'
equity and cash flows for the fiscal year or portion thereof then ended, setting
forth in each case in comparative form the corresponding figures from the
previous fiscal year, all certified by a Financial Officer as presenting fairly
in all material respects the financial condition and results of operations of
the Borrower on a stand alone basis in accordance with GAAP consistently
applied, subject to the absence of footnotes and (in the case of such financial
statements delivered concurrently with those under clause (b) above) to year-end
audit adjustments and (ii) a certificate of a Financial Officer of the Borrower
in substantially the form of Exhibit D (x) certifying as to whether a Default
has occurred and, if a Default has occurred, specifying the details thereof and
any action taken or proposed to be taken with respect thereto, (y) setting forth
reasonably detailed calculations demonstrating compliance with Sections 6.03 to
6.06 and (z) stating whether any change in GAAP or in the application thereof
has occurred since the date of the audited financial statements referred to in
Section 3.04 and, if any such change has occurred, specifying the effect of such
change on the financial statements accompanying such certificate;
32
(d) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by the
Borrower or any Subsidiary with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or distributed by the
Borrower to its shareholders generally, as the case may be;
(e) promptly after ▇▇▇▇▇'▇ or S&P shall have announced a change in the
Borrower's credit rating, written notice of such rating change; and
(f) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any Subsidiary, or compliance with the terms of this Agreement, as
the Administrative Agent or any Lender may reasonably request.
Financial statements and other documents required to be delivered
pursuant to this Section 5.01 may be delivered electronically and if so
delivered, shall be deemed to have been delivered (i) to the extent such
documents are included in materials otherwise filed with the Securities and
Exchange Commission, when such filing is available to the Lenders on the ▇▇▇▇▇
website or (ii) in any case, on the date on which such documents are posted on
the Borrower's behalf on an Internet website to which each Lender and the
Administrative Agent has access and the Borrower notifies the Administrative
Agent and the Lenders of such posting. If the Borrower provides the financial
statements and other documents required to be delivered pursuant to this Section
5.01 electronically pursuant to the preceding sentence, the Borrower will
provide printed versions of such financial statements and other documents to any
Lender upon such Lender's request.
SECTION 5.02. NOTICES OF MATERIAL EVENTS. The Borrower will furnish to
the Administrative Agent and each Lender prompt written notice of the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by or
before any arbitrator or Governmental Authority against or affecting the
Borrower or any Affiliate thereof that, if adversely determined, may reasonably
be expected to result in a Material Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together with any
other ERISA Events that have occurred, may reasonably be expected to result in a
Material Adverse Effect; and
(d) any other development that results in, or may reasonably be expected
to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a
statement of a Financial Officer or other executive officer of the Borrower
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto.
33
SECTION 5.03. EXISTENCE; CONDUCT OF BUSINESS. The Borrower will, and
will cause each of its Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; PROVIDED that the foregoing shall not prohibit
any merger, consolidation, liquidation or dissolution permitted under Section
6.02.
SECTION 5.04. PAYMENT OF OBLIGATIONS. The Borrower will, and will cause
each of its Subsidiaries to, pay its obligations, including Tax liabilities,
that, if not paid, could result in a Material Adverse Effect before the same
shall become delinquent or in default, except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, (b) the
Borrower or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP and (c) the failure to make payment
pending such contest may not reasonably be expected to result in a Material
Adverse Effect.
SECTION 5.05. MAINTENANCE OF PROPERTIES; INSURANCE. The Borrower will,
and will cause each of its Subsidiaries to, (a) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear excepted, and (b) maintain, with financially sound and
reputable insurance companies, insurance in such amounts and against such risks
as are customarily maintained by companies engaged in the same or similar
businesses operating in the same or similar locations.
SECTION 5.06. BOOKS AND RECORDS; INSPECTION RIGHTS. The Borrower will,
and will cause each of its Subsidiaries to, keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Borrower will, and
will cause each of its Subsidiaries to, permit any representatives designated by
the Administrative Agent or any Lender, upon reasonable prior notice, to visit
and inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and independent accountants, all at such reasonable times and as often as
reasonably requested.
SECTION 5.07. COMPLIANCE WITH LAWS. The Borrower will, and will cause
each of its Subsidiaries to, comply with all laws, rules, regulations and orders
of any Governmental Authority applicable to it or its property, except (i) to
the extent, if any, that the Borrower and its Subsidiaries may not be in such
compliance in connection with the Disclosed Matters or (ii) where the failure to
do so, individually or in the aggregate, may not reasonably be expected to
result in a Material Adverse Effect.
SECTION 5.08. USE OF PROCEEDS. The proceeds of the Loans will be used
for general corporate purposes, including without limitation acquisitions and
any payments required to be made in connection with the Disclosed Matters. No
part of the proceeds of any Loan will be used, whether directly or indirectly,
for any purpose that entails a violation of any of the Regulations of the Board,
including Regulations T, U and X.
34
ARTICLE 6
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal of
and interest on each Loan and all fees payable hereunder have been paid in full,
the Borrower covenants and agrees with the Lenders that:
SECTION 6.01. LIENS. The Borrower will not create, incur, assume or
permit to exist any Lien on any property or asset now owned or hereafter
acquired by it, or assign or sell any income or revenues (including accounts
receivable) or rights in respect of any thereof, except:
(a) Permitted Encumbrances;
(b) any Lien on any property or asset of the Borrower existing on the
date hereof and set forth in Schedule 6.01; PROVIDED that (i) such Lien shall
not apply to any other property or asset of the Borrower or any Subsidiary and
(ii) such Lien shall secure only those obligations which it secures on the date
hereof and extensions, renewals and replacements thereof that do not increase
the outstanding principal amount thereof;
(c) any Lien existing on any property or asset prior to the acquisition
thereof by the Borrower PROVIDED that (i) such Lien is not created in
contemplation of or in connection with such acquisition, (ii) such Lien shall
not apply to any other property or assets of the Borrower and (iii) such Lien
shall secure only those obligations which it secures on the date of such
acquisition or the date such Person becomes a Subsidiary, as the case may be and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;
(d) Liens on fixed or capital assets acquired, constructed or improved
by the Borrower PROVIDED that (i) such security interests and the Indebtedness
secured thereby are incurred prior to or within 180 days after such acquisition
or the completion of such construction or improvement and (ii) such security
interests shall not apply to any other property or assets of the Borrower or any
Subsidiary; and
(e) Liens not otherwise permitted by the following clauses of this
Section securing Indebtedness or other obligations in an aggregate principal or
face amount not at any time exceeding $25,000,000.
For avoidance of doubt, the provisions of this Section 6.01 do not
restrict Liens on property or assets of Subsidiaries.
35
SECTION 6.02. FUNDAMENTAL CHANGES. (a) The Borrower will not merge into
or consolidate with any other Person, or permit any other Person to merge into
or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one
transaction or in a series of transactions) all or substantially all of the
Borrower's assets or liquidate or dissolve, except that, if at the time thereof
and immediately after giving effect thereto no Default shall have occurred and
be continuing, any Person may merge into the Borrower in a transaction in which
the Borrower is the surviving corporation.
(b) The Borrower will not, and will not permit any of its Subsidiaries
to, engage to any material extent in any business other than businesses of the
type conducted by the Borrower and its Subsidiaries on the date of execution of
this Agreement and businesses reasonably related thereto, including other
businesses reasonably related to education services.
SECTION 6.03. MINIMUM CONSOLIDATED NET WORTH. Consolidated Net Worth
shall be no less than the sum of (i) $493,110,000, (ii) an amount equal to 50%
of Consolidated Net Income for (x) the fiscal year ending December 31, 2007 and
(y) each subsequent fiscal year of the Borrower, in each case, for which such
Consolidated Net Income is positive (but with no deduction on account of
negative Consolidated Net Income for any such fiscal period) and (iii) 100% of
the amount of any increase in Consolidated Net Worth attributable to the
issuance of capital stock of the Borrower subsequent to December 31, 2006.
SECTION 6.04. ADJUSTED EBITDA TO CORPORATE DEBT INTEREST. The ratio of
Adjusted EBITDA to Corporate Debt Interest for each period of four consecutive
fiscal quarters shall be (a) not less than 3:1, if the Borrower has Unencumbered
Assets of less than $250,000,000 on the last day of such period, or (b) not less
than 2.5:1, if the Borrower has Unencumbered Assets at least $250,000,000 on the
last day of such period.
SECTION 6.05. SUBSIDIARY INDEBTEDNESS. The Borrower will not permit any
Subsidiary to create, incur, assume or suffer to exist any unsecured
Indebtedness, except (i) Intercompany Indebtedness and (ii) other unsecured
Indebtedness in the aggregate principal amount at any time outstanding not to
exceed $25,000,000.
SECTION 6.06. NON-FFELP LOANS TO ALL LOANS. The Borrower will not permit
the ratio of (a) the aggregate amount of Non-FFELP Loans owned by the Borrower
and its Consolidated Subsidiaries to (b) the aggregate amount of all student
loans receivable owned by the Borrower and its Consolidated Subsidiaries at any
time to equal or exceed 0.15:1.
36
ARTICLE 7
EVENTS OF DEFAULT
If any of the following events ("EVENTS OF DEFAULT") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan when and as
the same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any fee
or any other amount (other than an amount referred to in clause (a) of this
Article) payable under this Agreement, when and as the same shall become due and
payable, and such failure shall continue unremedied for a period of five
Business Days;
(c) any representation or warranty made or deemed made by or on behalf
of the Borrower in or in connection with this Agreement or any amendment or
modification hereof or waiver hereunder, or in any report, certificate,
financial statement or other document furnished pursuant to or in connection
with this Agreement or any amendment or modification hereof or waiver hereunder,
shall prove to have been incorrect when made or deemed made;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.02(a), 5.03 (with respect to the
Borrower's existence) or in Article 6; PROVIDED that in the case of Section 6.01
or 6.05, such failure shall continue unremedied for a period of 30 days after an
executive officer of the Borrower first becomes aware of such failure;
(e) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those specified
in clause (a), (b) or (d) of this Article), and such failure shall continue
unremedied for a period of 30 days after notice thereof from the Administrative
Agent to the Borrower (which notice will be given at the request of any Lender);
(f) the Borrower or any Subsidiary shall fail to make any payment
(whether of principal or interest and regardless of amount) in respect of any
Material Indebtedness, when and as the same shall become due and payable;
(g) any event or condition occurs that (i) results in any Material
Indebtedness becoming due prior to its scheduled maturity or (ii) is continuing
(after any applicable grace period or cure period has expired) so as to enable
or permit the holder or holders of any Material Indebtedness or any trustee or
agent on its or their behalf to cause any Material Indebtedness to become due,
or to require the prepayment, repurchase, redemption or defeasance thereof,
prior to its scheduled maturity; PROVIDED that (x) this clause (g) shall not
apply to secured Indebtedness that becomes due as a result of the voluntary sale
or transfer of the property or assets securing such Indebtedness and (y) a Swap
Agreement shall be considered to become due prior to its schedule maturity only
if it becomes so due upon termination resulting from the Borrower's default
thereunder;
37
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of the Borrower or any Subsidiary or its debts, or of a substantial
part of its assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect or (ii) the appointment
of a receiver, trustee, custodian, sequestrator, conservator or similar official
for the Borrower or any Subsidiary or for a substantial part of its assets, and,
in any such case, such proceeding or petition shall continue undismissed for 60
days or an order or decree approving or ordering any of the foregoing shall be
entered;
(i) the Borrower or any Subsidiary shall (i) voluntarily commence any
proceeding or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect, (ii) consent to the institution of,
or fail to contest in a timely and appropriate manner, any proceeding or
petition described in clause (h) of this Article, (iii) apply for or consent to
the appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Borrower or any Subsidiary or for a substantial part of
its assets, (iv) file an answer admitting the material allegations of a petition
filed against it in any such proceeding, (v) make a general assignment for the
benefit of creditors or (vi) take any action indicating its consent to, approval
of, or acquiescence in any of the foregoing;
(j) the Borrower or any Subsidiary shall become unable, admit in writing
its inability or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $25,000,000 shall be rendered against the Borrower, any
Subsidiary or any combination thereof and the same shall remain undischarged for
a period of 30 consecutive days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to attach or
levy upon any assets of the Borrower or any Subsidiary to enforce any such
judgment;
(l) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other ERISA Events that have
occurred, may reasonably be expected to result in a Material Adverse Effect; or
(m) a Change in Control shall occur;
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times: (n) terminate the
Commitments, and thereupon the Commitments shall terminate immediately, and (o)
declare the Loans then outstanding to be due and payable in whole (or in part,
in which case any principal not so declared to be due and payable may thereafter
38
be declared to be due and payable), and thereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall become due
and payable immediately, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Borrower; and in case of any
event with respect to the Borrower described in clause (h) or (i) of this
Article, the Commitments shall automatically terminate and the principal of the
Loans then outstanding, together with accrued interest thereon and all fees and
other obligations of the Borrower accrued hereunder, shall automatically become
due and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower.
ARTICLE 8
THE ADMINISTRATIVE AGENT
Each of the Lenders hereby irrevocably appoints the Administrative Agent
as its agent and authorizes the Administrative Agent to take such actions on its
behalf and to exercise such powers as are delegated to the Administrative Agent
by the terms hereof, together with such actions and powers as are reasonably
incidental thereto.
The bank serving as the Administrative Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Administrative Agent, and such bank
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations except
those expressly set forth herein. Without limiting the generality of the
foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or
other implied duties, regardless of whether a Default has occurred and is
continuing, (b) the Administrative Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby that the Administrative Agent is
required to exercise in writing as directed by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (c) except as expressly set
forth herein, the Administrative Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to the
Borrower or any of its Subsidiaries that is communicated to or obtained by the
bank serving as Administrative Agent or any of its Affiliates in any capacity.
The Administrative Agent shall not be liable for any action taken or not taken
by it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
39
circumstances as provided in Section 9.02) or in the absence of its own gross
negligence or wilful misconduct. The Administrative Agent shall be deemed not to
have knowledge of any Default unless and until written notice thereof is given
to the Administrative Agent by the Borrower or a Lender, and the Administrative
Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection herewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein, (iv) the validity, enforceability, effectiveness or genuineness of
this Agreement or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article 5 or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to be made by the proper Person, and shall not incur any liability for
relying thereon. The Administrative Agent may consult with legal counsel (who
may be counsel for the Borrower), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and exercise
its rights and powers by or through any one or more sub-agents appointed by the
Administrative Agent. The Administrative Agent and any such sub-agent may
perform any and all its duties and exercise its rights and powers through their
respective Related Parties. The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their respective
activities in connection with the syndication of the credit facilities provided
for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor Administrative
Agent as provided in this paragraph, the Administrative Agent may resign at any
time by notifying the Lenders and the Borrower. Upon any such resignation, the
Required Lenders shall have the right, in consultation with the Borrower, to
appoint a successor. If no successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Administrative Agent gives notice of its resignation, then the
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent which shall be a bank with an office in New York, New York,
or an Affiliate of any such bank. Upon the acceptance of its appointment as
Administrative Agent hereunder by a successor, such successor shall succeed to
40
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the
Borrower to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 9.03 shall continue in effect for the
benefit of such retiring Administrative Agent, its sub agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while it was acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without reliance
upon the Administrative Agent or any other Lender and based on such documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents and information as it shall from time
to time deem appropriate, continue to make its own decisions in taking or not
taking action under or based upon this Agreement, any related agreement or any
document furnished hereunder or thereunder.
ARTICLE 9
MISCELLANEOUS
SECTION 9.01. NOTICES. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy, as follows:
(i) if to the Borrower, to it at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (Telecopy No. (402)
458-2399);
(ii) if to the Administrative Agent, to JPMorgan Chase Bank,
N.A., Loan and Agency Services Group, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇;
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇);
(iii) if to any other Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire.
(b) Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; PROVIDED that the foregoing shall not
apply to service of process pursuant to Section 9.09 or otherwise under
applicable law, or to notices pursuant to Article 2 unless otherwise agreed by
41
the Administrative Agent and the applicable Lender. The Administrative Agent or
the Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; PROVIDED that approval of such procedures may be
limited to particular notices or communications.
(c) Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other parties
hereto. All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt.
SECTION 9.02. WAIVERS; AMENDMENTS. (a) No failure or delay by the
Administrative Agent or any Lender in exercising any right or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or
the exercise of any other right or power. The rights and remedies of the
Administrative Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan shall not
be construed as a waiver of any Default, regardless of whether the
Administrative Agent or any Lender may have had notice or knowledge of such
Default at the time.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders; PROVIDED that no
such agreement shall (i) increase the Commitment of any Lender without the
written consent of such Lender, (ii) reduce the principal amount of any Loan or
reduce the rate of interest thereon, or reduce any fees payable hereunder,
without the written consent of each Lender affected thereby, (iii) postpone the
scheduled date of payment of the principal amount of any Loan, or any interest
thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse
any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby, (iv)
change Section 2.15(b) or (c) in a manner that would alter the pro rata sharing
of payments required thereby, without the written consent of each Lender, or (v)
change any of the provisions of this Section or the definition of "REQUIRED
LENDERS" or any other provision hereof specifying the number or percentage of
Lenders required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the written consent of
each Lender; provided further that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent hereunder
without the prior written consent of the Administrative Agent.
42
SECTION 9.03. EXPENSES; INDEMNITY; DAMAGE WAIVER. The Borrower shall pay
(i) all reasonable out of pocket expenses incurred by the Administrative Agent
and its Affiliates, including the reasonable fees, charges and disbursements of
counsel for the Administrative Agent, in connection with the syndication of the
credit facilities provided for herein, the preparation and administration of
this Agreement or any amendments, modifications or waivers of the provisions
hereof (whether or not the transactions contemplated hereby or thereby shall be
consummated) and (ii) all out-of-pocket expenses incurred by the Administrative
Agent or any Lender, including the fees, charges and disbursements of any
counsel for the Administrative Agent or any Lender, in connection with the
enforcement or protection of its rights in connection with this Agreement,
including its rights under this Section, or in connection with the Loans made
hereunder, including all such out-of pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans.
(b) The Borrower shall indemnify the Administrative Agent and each
Lender, and each Related Party of any of the foregoing Persons (each such Person
being called an "Indemnitee") against, and hold each Indemnitee harmless from,
any and all losses, claims, damages, liabilities and related expenses, including
the reasonable fees, charges and disbursements of any counsel for any
Indemnitee, incurred by or asserted against any Indemnitee arising out of, in
connection with, or as a result of (i) the execution or delivery of this
Agreement or any agreement or instrument contemplated hereby, the performance by
the parties hereto of their respective obligations hereunder or the consummation
of the Transactions or any other transactions contemplated hereby, (ii) any Loan
or the use of the proceeds therefrom, (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property owned or operated by the
Borrower or any of its Subsidiaries, or any Environmental Liability related in
any way to the Borrower or any of its Subsidiaries, or (iv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory and
regardless of whether any Indemnitee is a party thereto; PROVIDED that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from (x) the Indemnitee's bad faith breach of its express contractual
obligations under this Agreement or (y) the gross negligence or wilful
misconduct of such Indemnitee.
(c) To the extent that the Borrower fails to pay any amount required to
be paid by it to the Administrative Agent under paragraph (a) or (b) of this
Section, each Lender severally agrees to pay to the Administrative Agent such
Lender's Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
PROVIDED that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent in its capacity as such.
43
(d) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Transactions, any Loan or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable promptly after
written demand therefor.
SECTION 9.04. SUCCESSORS AND ASSIGNS. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that (i) the Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender (and any attempted assignment
or transfer by the Borrower without such consent shall be null and void) and
(ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants (to the extent provided in paragraph (c) of this Section) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.
(b)(i) Subject to the conditions set forth in paragraph (b)(ii) below,
any Lender may assign to one or more assignees all or a portion of its rights
and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it) with the prior written consent
(such consent not to be unreasonably withheld) of:
(A) the Borrower, PROVIDED that no consent of the
Borrower shall be required for an assignment to a Lender, an
Affiliate of a Lender, an Approved Fund or, if an Event of
Default has occurred and is continuing, any other assignee; and
(B) the Administrative Agent.
(ii) Assignments shall be subject to the following additional
conditions:
44
(A) except in the case of an assignment to a Lender or
an Affiliate of a Lender or an assignment of the entire
remaining amount of the assigning Lender's Commitment or Loans,
the amount of the Commitment or Loans of the assigning Lender
subject to each such assignment (determined as of the date the
Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent) shall not be less than
$5,000,000 unless each of the Borrower and the Administrative
Agent otherwise consent, PROVIDED that no such consent of the
Borrower shall be required if an Event of Default has occurred
and is continuing;
(B) each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender's
rights and obligations under this Agreement;
(C) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and
Assumption, together with a processing and recordation fee of
$3,500; and
(D) the assignee, if it shall not be a Lender, shall
deliver to the Administrative Agent an Administrative
Questionnaire.
For the purposes of this Section 9.04(b), the term "APPROVED FUND" has
the following meaning:
"APPROVED FUND" means any Person (other than a natural person) that is
engaged in making, purchasing, holding or investing in bank loans and similar
extensions of credit in the ordinary course of its business and that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an
entity or an Affiliate of an entity that administers or manages a Lender.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section, from and after the effective date
specified in each Assignment and Assumption the assignee thereunder
shall be party hereto as a Lender with respect to the interest assigned
and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this
Agreement in addition to any rights and obligations theretofore held by
it as a Lender hereunder (if any), and the assigning Lender thereunder
shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and,
in the case of an Assignment and Assumption covering all of the
assigning Lender's rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be
entitled to the benefits of Sections 2.12, 2.13, 2.14 and 9.03). Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that purports to be effective notwithstanding a failure to
comply with this Section 9.04 shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (c) of this Section.
45
(iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy of
each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the
Commitment of, and principal amount of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the "REGISTER"). The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary. The Register shall be available for inspection by the
Borrower and any Lender at any reasonable time and from time to time
upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and
Assumption executed by an assigning Lender and an assignee, the
assignee's completed Administrative Questionnaire (unless the assignee
shall already be a Lender hereunder), the processing and recordation fee
referred to in paragraph (b) of this Section and any written consent to
such assignment required by paragraph (b) of this Section, the
Administrative Agent shall accept such Assignment and Assumption and
record the information contained therein in the Register. No assignment
shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.
(c) (i) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a "PARTICIPANT") in all or a portion of such Lender's rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans
owing to it); PROVIDED that (A) such Lender's obligations under this Agreement
shall remain unchanged, (B) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (C) the
Borrower, the Administrative Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; PROVIDED that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 9.02(b) that affects such Participant.
Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 9.08 as
though it were a Lender, provided such Participant agrees to be subject to
Section 2.15(c) as though it were a Lender.
46
(ii) A Participant shall not be entitled to receive any greater
payment under Section 2.12 or 2.14 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is
made with the Borrower's prior written consent. A Participant that would
be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 2.14 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for
the benefit of the Borrower, to comply with Section 2.14(e) as though it
were a Lender.
(d) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; PROVIDED that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
SECTION 9.05. SURVIVAL. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent, or any Lender may have
had notice or knowledge of any Default or incorrect representation or warranty
at the time any credit is extended hereunder, and shall continue in full force
and effect as long as the principal of or any accrued interest on any Loan or
any fee or any other amount payable under this Agreement is outstanding and
unpaid and so long as the Commitments have not expired or terminated. The
provisions of Sections 2.12, 2.13, 2.14 and 9.03 and Article 8 shall survive and
remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Commitments or the termination of this Agreement or any
provision hereof.
SECTION 9.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This Agreement
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and any
separate letter agreements with respect to fees payable to the Administrative
Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except as provided in
47
Section 4.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 9.07. SEVERABILITY. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 9.08. RIGHT OF SETOFF. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of the
Borrower against any of and all the obligations of the Borrower now or hereafter
existing under this Agreement held by such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured. The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.
SECTION 9.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
PROCESS. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York.
(b) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the Supreme Court
of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement, 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 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 the Administrative Agent, or any Lender may otherwise have
to bring any action or proceeding relating to this Agreement against the
Borrower or its properties in the courts of any jurisdiction.
48
(c) The 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 in any court referred to in
paragraph (b) of this Section. 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.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) 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 (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. HEADINGS. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. CONFIDENTIALITY. Each of the Administrative Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to it and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent requested
by any regulatory or self-regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or the enforcement of rights hereunder, (f) subject to an agreement containing
49
provisions substantially the same as those of this Section, to any assignee of
or Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, (g) with the consent of the Borrower
or (h) to the extent such Information (i) becomes publicly available other than
as a result of a breach of this Section or (ii) becomes available to the
Administrative Agent, or any Lender on a nonconfidential basis from a source
other than the Borrower. For the purposes of this Section, "INFORMATION" means
all information received from the Borrower relating to the Borrower or its
business, other than any such information that is available to the
Administrative Agent, or any Lender on a nonconfidential basis prior to
disclosure by the Borrower; PROVIDED that, in the case of information received
from the Borrower after the date hereof, such information is clearly identified
at the time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information. The provisions of this
Section 9.12 are without prejudice to any other confidentiality undertakings the
Administrative Agent or any Lender may enter into with the Borrower as to any
particular information.
SECTION 9.13. USA PATRIOT ACT. Each Lender hereby notifies the Borrower
that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the "ACT"), it is required to
obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Lender to identify the Borrower in accordance with the Act.
50
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized representatives as of the day and
year first above written.
NELNET, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: President
51
ADMINISTRATIVE AGENT AND LENDER
JPMORGAN CHASE BANK, N.A., individually
and as Administrative Agent
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
52
SYNDICATION AGENT AND LENDER
CITIBANK, N.A., individually and as
Syndication Agent
By: /s/ ▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Managing Director
53
DOCUMENTATION AGENT AND LENDER
BANK OF AMERICA, N.A.
By: /s/ ▇▇▇▇ ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Vice President
54
DOCUMENTATION AGENT AND LENDER
BARCLAYS BANK PLC
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Title: Director
55
DOCUMENTATION AGENT AND LENDER
CREDIT SUISSE, CAYMAN ISLANDS BRANCH
By: /s/ ▇▇▇ ▇▇▇▇▇
---------------------------------
Name: ▇▇▇ ▇▇▇▇▇
Title: Director
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Assistant Vice President
56
CO-DOCUMENTATION AGENT AND LENDER
DEUTSCHE BANK AG NEW YORK BRANCH
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Director
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
57
CO-DOCUMENTATION AGENT AND LENDER
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ BANK
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Authorized Signatory
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Bank
58
CO-AGENT AND LENDER
▇▇▇▇▇▇ BROTHERS BANK, FSB
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Authorized Signatory
59
CO-AGENT AND LENDER
GREENWICH CAPITAL MARKETS, INC., as agent
for THE ROYAL BANK OF SCOTLAND plc
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
60
CO-AGENT AND LENDER
SUNTRUST BANKS, INC.
By: /s/ ▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Director
61
LENDER
SOCIETE GENERALE
By: /s/ ▇▇▇▇▇▇▇ ▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇
Title: Vice President
▇▇
▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇
Title: Authorized Signatory
63
LENDER
FIRST NATIONAL BANK OF OMAHA
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Correspondent Banking Officer
64
COMMITMENT SCHEDULE
========================================================= ==================
Lender Commitment
--------------------------------------------------------- ------------------
JPMorgan Chase Bank, N.A. $ 82,500,000
--------------------------------------------------------- ------------------
Citibank, N.A. 72,500,000
--------------------------------------------------------- ------------------
Bank of America, N.A. 72,500,000
--------------------------------------------------------- ------------------
Barclays Bank PLC 72,500,000
--------------------------------------------------------- ------------------
Credit Suisse, Cayman Islands Branch 72,500,000
--------------------------------------------------------- ------------------
Deutsche Bank AG 72,500,000
--------------------------------------------------------- ------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Bank 72,500,000
--------------------------------------------------------- ------------------
▇▇▇▇▇▇ Brothers Bank, FSB 52,500,000
--------------------------------------------------------- ------------------
Royal Bank of Scotland plc 52,500,000
--------------------------------------------------------- ------------------
SunTrust Banks, Inc. 52,500,000
--------------------------------------------------------- ------------------
Societe Generale 40,000,000
--------------------------------------------------------- ------------------
Royal Bank of Canada 25,000,000
--------------------------------------------------------- ------------------
First National Bank of Omaha 10,000,000
--------------------------------------------------------- ------------------
TOTAL $750,000,000
========================================================= ==================
65
PRICING SCHEDULE
Each of "FACILITY FEE RATE" and "EURO-DOLLAR MARGIN" means, for any
date, the rate set forth below in the row opposite such term and in the column
corresponding to the "Status" and "Utilization" that exist on such date:
--------------------------------------------------------------------------------
STATUS LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V LEVEL VI
--------------------------------------------------------------------------------
Facility Fee Rate .0500% .0600% .0750% .1000% .1250% .1500%
--------------------------------------------------------------------------------
Euro-Dollar Margin
--------------------------------------------------------------------------------
Utilization < 50% .1500% .1900% .2750% .3000% .3750% .6000%
--------------------------------------------------------------------------------
Utilization = 50% .2500% .2900% .3750% .4000% .4750% .7000%
--------------------------------------------------------------------------------
For purposes of this Schedule, the following terms have the following
meanings, subject to the concluding paragraph of this Schedule:
"LEVEL I STATUS" exists at any date if, at such date, the Borrower's
credit rating is A or higher by S&P OR A2 of higher by ▇▇▇▇▇'▇.
"LEVEL II STATUS" exists at any date if, at such date, (i) the
Borrower's credit rating is A- or higher by S&P OR A3 or higher by ▇▇▇▇▇'▇ and
(ii) Level I Status does not exist.
"LEVEL III STATUS" exists at any date if, at such date, (i) the
Borrower's credit rating is BBB+ or higher by S&P OR Baa1 or higher by ▇▇▇▇▇'▇
and (ii) neither Level I Status nor Level II Status exists.
"LEVEL IV STATUS" exists at any date if, at such date, (i) the
Borrower's credit rating is BBB or higher by S&P OR Baa2 or higher by ▇▇▇▇▇'▇
and (ii) none of Level I Status, Level II Status and Level III Status exists.
"LEVEL V STATUS" exists at any date if, at such date, (i) the Borrower's
credit rating is BBB- or higher by S&P OR Baa3 or higher by ▇▇▇▇▇'▇ and (ii)
none of Level I Status, Level II Status, Level III Status and Level IV Status
exists.
"LEVEL VI STATUS" exists at any date if, at such date, no other Status
exists.
"STATUS" refers to the determination of which of Level I Status, Level
II Status, Level III Status, Level IV Status, Level V Status or Level VI Status
exists at any date.
"UTILIZATION" means at any date the percentage equivalent of a fraction
(i) the numerator of which is the aggregate outstanding principal amount of the
Loans at such date, after giving effect to any borrowing or payment on such
date, and (ii) the denominator of which is the aggregate amount of the
Commitments at such date, after giving effect to any reduction of the
Commitments on such date. For purposes of this Schedule, if for any reason any
Loans remain outstanding after termination of the Commitments, the Utilization
for each date on or after the date of such termination shall be deemed to be
100%.
66
The credit ratings to be utilized for purposes of this Schedule are
those assigned to the senior unsecured long-term debt securities of the Borrower
without third-party credit enhancement, and any rating assigned to any other
debt security of the Borrower shall be disregarded. The rating in effect at any
date is that in effect at the close of business on such date. In the case of
split ratings from S&P's and ▇▇▇▇▇'▇, the rating to be used to determine which
Status applies is the higher of the two; PROVIDED that if the split is more than
one notch, a rating one notch below the higher rating of the two shall be used.
67
Schedule 3.06
DISCLOSED MATTERS
Investigations pending by the United States Securities and Exchange
Commission, United States Department of Education, United States Department of
Justice, United States Senate, United States House of Representatives, Attorney
General of the State of New York, Attorney General of the State of Missouri,
Attorney(s) General of any other state(s) of the United States, and any other
Governmental Authority as described in the Borrower's Form 10K filed with the
United States Securities and Exchange Commission for the period ended December
31, 2006 and any findings, orders, judgments, settlements, Change in Law or
requirements of or liabilities to any Governmental Authority resulting therefrom
or related thereto.
68
Schedule 6.01
EXISTING LIENS
None.
69
Schedule 6.04
ELIGIBLE SECURITIES
"Eligible Securities" are:
(a) direct obligations of, or obligations on which the timely payment of
the principal of and interest on which are unconditionally and fully guaranteed
by, the United States of America;
(b) interest-bearing time or demand deposits, certificates of deposit or
other similar banking arrangements with a maturity of 12 months or less with any
bank, trust company, national banking association or other depository
institution, provided that, at the time of deposit or purchase such depository
institution has commercial paper which is rated "A-1+" by S&P and "F1" or higher
by Fitch and has the required ratings from ▇▇▇▇▇'▇ corresponding to the duration
of such investment set forth below;
(c) interest -bearing time or demand deposits, certificates of deposit
or other similar banking arrangements with a maturity of 24 months or less, but
more than 12 months, with any bank, trust company, national banking association
or other depository institution, provided that, at the time of deposit or
purchase such depository institution has senior debt rated "A" or higher by S&P
and "A" or higher by Fitch, if commercial paper is outstanding, commercial paper
which is rated "A-1+" by S&P and "F1" or higher by Fitch and has the required
ratings from ▇▇▇▇▇'▇ corresponding to the duration of such investment set forth
below;
(d) interest -bearing time or demand deposits, certificates of deposit
or other similar banking arrangements with a maturity of more than 24 months
with any bank, trust company, national banking association or other depository
institution, provided that, at the time of deposit or purchase such depository
institution has senior debt rated "AA" or higher by S&P and "AA" or higher by
Fitch, if commercial paper is outstanding, commercial paper which is rated
"A-1+" by S&P, "P-1" by ▇▇▇▇▇'▇ and "F1" or higher by Fitch and has the required
ratings from ▇▇▇▇▇'▇ corresponding to the duration of such investment set forth
below;
(e) bonds, debentures, notes or other evidences of indebtedness issued
or guaranteed by any of the following agencies: Federal Farm Credit Banks,
Federal Home Loan Mortgage Corporation; the Export-Import Bank of the United
States; the Federal National Mortgage Association; the Farmers Home
Administration; Federal Home Loan Banks provided such obligation is rated "AAA"
by S&P, "Aaa" by ▇▇▇▇▇'▇ and "AAA" by Fitch; or any agency or instrumentality of
the United States of America which shall be established for the
70
purposes of acquiring the obligations of any of the foregoing or otherwise
providing financing therefor;
(f) repurchase agreements and reverse repurchase agreements, other than
overnight repurchase agreements and overnight reverse repurchase agreements,
with banks which are members of the Federal Deposit Insurance Corporation or
firms which are members of the Securities Investors Protection Corporation, in
each case whose outstanding, unsecured debt securities are rated "A" or higher
by S&P and "A" or higher by Fitch, if commercial paper is outstanding,
commercial paper which is rated "A-1+" by S&P and "F1" or higher by Fitch and
has the required ratings from ▇▇▇▇▇'▇ corresponding to the duration of such
investment set forth below;
(g) overnight repurchase agreements and overnight reverse repurchase
agreements at least 101% collateralized by securities described in subparagraph
(a) of this definition and with a counterparty that has senior debt rated "A" or
higher by S&P and "A" or higher by Fitch, if commercial paper is outstanding,
commercial paper which is rated "A-1+" by S&P and "F1" or higher by Fitch and
has the required ratings from ▇▇▇▇▇'▇ corresponding to the duration of such
investment set forth below, or a counterparty approved in writing by S&P,
▇▇▇▇▇'▇ and Fitch, respectively;
(h) investment agreements or guaranteed investment contracts, which may
be entered into by the Borrower and any bank, bank holding company, corporation
or any other financial institution, whose outstanding (i) commercial paper is
rated "A-1+" by S&P and "F1" or higher by Fitch for agreements or contracts with
a maturity of 12 months or less and has the required ratings from ▇▇▇▇▇'▇
corresponding to the duration of such investment set forth below; (ii) unsecured
long-term debt is rated "A" or higher by S&P and "A" or higher by Fitch and, if
commercial paper is outstanding, commercial paper which is rated "A-1+" by S&P
and "F1" or higher by Fitch for agreements or contracts with a maturity of 24
months or less, but more than 12 months and has the required ratings from
▇▇▇▇▇'▇ corresponding to the duration of such investment set forth below, or
(iii) unsecured long-term debt is rated "A" or higher by S&P and "A" or higher
by Fitch and, if commercial paper is outstanding, commercial paper which is
rated "A-1+" by S&P and "F1" or higher by Fitch for agreements or contracts with
a maturity of more than 24 months and has the required ratings from ▇▇▇▇▇'▇
corresponding to the duration of such investment set forth below, or, in each
case, by an insurance company whose claims-paying ability is so rated;
(i) "tax exempt bonds" as defined in Section 150(a)(6) of the Code,
other than "specified private activity bonds" as defined in Section 57(a)(5)(C)
of the Code, that are rated in the highest category by S&P and Fitch for
long-term or short-term debt, or shares of a so-called money market or mutual
fund rated "AAAm/AAAm-G" or higher by S&P, and "AA/F1+" or higher by Fitch and
has the required ratings from ▇▇▇▇▇'▇ corresponding to the duration of such
investment set forth below, that do not constitute "investment property" within
71
the meaning of Section 148(b)(2) of the Code, provided that the fund has all of
its assets invested in obligations of such rating quality;
(j) commercial paper which is rated in the single highest
classification, "A-1+" by S&P and "F1" or higher by Fitch and has the required
ratings from ▇▇▇▇▇'▇ corresponding to the duration of such investment set forth
below, and which matures not more than 270 days after the date of purchase; and
(k) investments in a money market fund rated at least "AAAm" or "AAAm-G"
by S&P, "Aaa" by ▇▇▇▇▇'▇ and "AA" or "F1" or higher by Fitch.
Each Eligible Security or the provider of such Eligible Security (other than
those described in paragraphs (a), (e) and (k) of this definition) shall have
the following ▇▇▇▇▇'▇ long-term and or short-term ratings corresponding to the
duration of such investment:
Maximum Maturity Minimum Ratings
One Month "A2" or "Prime-1"
Three Months "A1" and "Prime-1"
Six Months "Aa3" and "Prime-1"
Greater than Six Months "Aaa" and "Prime-1"
72
EXHIBIT A
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the "ASSIGNMENT AND ASSUMPTION") is
dated as of the Effective Date set forth below and is entered into by and
between [INSERT NAME OF ASSIGNOR] (the "ASSIGNOR") and [INSERT NAME OF ASSIGNEE]
(the "ASSIGNEE"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
"CREDIT AGREEMENT"), receipt of a copy of which is hereby acknowledged by the
Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto
are hereby agreed to and incorporated herein by reference and made a part of
this Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date inserted by
the Administrative Agent as contemplated below (i) all of the Assignor's rights
and obligations in its capacity as a Lender under the Credit Agreement and any
other documents or instruments delivered pursuant thereto to the extent related
to the amount and percentage interest identified below of all of such
outstanding rights and obligations of the Assignor under the respective
facilities identified below and (ii) to the extent permitted to be assigned
under applicable law, all claims, suits, causes of action and any other right of
the Assignor (in its capacity as a Lender) against any Person, whether known or
unknown, arising under or in connection with the Credit Agreement, any other
documents or instruments delivered pursuant thereto or the loan transactions
governed thereby or in any way based on or related to any of the foregoing,
including contract claims, tort claims, malpractice claims, statutory claims and
all other claims at law or in equity related to the rights and obligations sold
and assigned pursuant to clause (i) above (the rights and obligations sold and
assigned pursuant to clauses (i) and (ii) above being referred to herein
collectively as the "ASSIGNED Interest"). Such sale and assignment is without
recourse to the Assignor and, except as expressly provided in this Assignment
and Assumption, without representation or warranty by the Assignor.
1. Assignor: ______________________________
2. Assignee: ______________________________ [and is an
Affiliate/Approved Fund of
[IDENTIFY LENDER](1)]
3. Borrower(s): Nelnet, Inc. ("NELNET")
-----------------------
(1) Select as applicable.
A-1
4. Administrative Agent: JPMorgan Chase Bank, N.A. ("JPMCB") as the
administrative agent under the Credit
Agreement
5. Credit Agreement: The Amended and Restated Credit Agreement
dated as of May 8, 2007 among Nelnet, the
Lenders parties thereto, JPMCB, as
Administrative Agent, and Citibank, N.A., as
Syndication Agent, as amended and in effect
from time to time
6. Assigned Interest:
Aggregate Amount of Amount of Percentage Assigned
Facility Commitment/Loans for Commitment/Loans of Commitment/
Assigned(2) all Lenders Assigned Loans(3)
$ $ %
$ $ %
$ $ %
Effective Date: _____________ ___, 20___ [TO BE INSERTED BY
ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER IN THE REGISTER THEREFOR.]
-----------------------
(2) Fill in the appropriate terminology for the Types of facilities
under the Credit Agreement that are being assigned under this Assignment (e.g.,
"Eurodollar" or "ABR")
(3) Set forth, to at least 9 decimals, as a percentage of the
Commitment/Loans of all Lenders thereunder.
A-2
The terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:
------------------------------------
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:
------------------------------------
Title:
Consented to and Accepted:
JPMORGAN CHASE BANK, N.A., as
Administrative Agent
By:
------------------------------------
Title:
▇-▇
▇▇▇▇▇ ▇
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ CREDIT AGREEMENT dated as of May 8, 2007 among
NELNET, INC., the LENDERS party thereto, JPMORGAN CHASE BANK, N.A., as
Administrative Agent, and Citibank N.A., as Syndication Agent
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. REPRESENTATIONS AND WARRANTIES.
1.1 ASSIGNOR. The Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of the Assigned Interest, (ii) the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim and
(iii) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby; and (b) assumes no responsibility with respect
to (i) any statements, warranties or representations made in or in connection
with the Credit Agreement or any other Loan Document , (ii) the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the
Loan Documents or any collateral thereunder, (iii) the financial condition of
the Borrower, any of its Subsidiaries or Affiliates or any other Person
obligated in respect of any Loan Document or (iv) the performance or observance
by the Borrower, any of its Subsidiaries or Affiliates or any other Person of
any of their respective obligations under any Loan Document.
1.2. ASSIGNEE. The Assignee (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
satisfies the requirements, if any, specified in the Credit Agreement that are
required to be satisfied by it in order to acquire the Assigned Interest and
become a Lender, (iii) from and after the Effective Date, it shall be bound by
the provisions of the Credit Agreement as a Lender thereunder and, to the extent
of the Assigned Interest, shall have the obligations of a Lender thereunder,
(iv) it has received a copy of the Credit Agreement, together with copies of the
most recent financial statements delivered pursuant to Section 5.01 thereof, as
applicable, and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase the Assigned Interest on the basis of
which it has made such analysis and decision independently and without reliance
on the Administrative Agent or any other Lender, and (v) if it is a Foreign
Lender , attached to the Assignment and Assumption is any documentation required
to be delivered by it pursuant to the terms of the Credit Agreement, duly
completed and executed by the Assignee; and (b) agrees that (i) it will,
independently and without reliance on the Administrative Agent, the Assignor or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender.
A-4
2. PAYMENTS. From and after the Effective Date, the Administrative Agent
shall make all payments in respect of the Assigned Interest (including payments
of principal, interest, fees and other amounts) to the Assignor for amounts
which have accrued to but excluding the Effective Date and to the Assignee for
amounts which have accrued from and after the Effective Date.
3. GENERAL PROVISIONS. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Assumption may be executed in any
number of counterparts, which together shall constitute one instrument. Delivery
of an executed counterpart of a signature page of this Assignment and Assumption
by telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of New York.
A-5
EXHIBIT B
OPINION OF COUNSEL FOR THE BORROWER
May 8, 2007
To the Lenders and the Administrative
Agent Referred to Below
c/o JPMorgan Chase Bank, N.A., as
Administrative Agent
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
We have acted as counsel for Nelnet, Inc., a Nebraska corporation (the
"BORROWER"), in connection with the Amended and Restated Credit Agreement dated
as of May 8, 2007 (the "CREDIT AGREEMENT"), among the Borrower, the banks and
other financial institutions identified therein as Lenders, and JPMorgan Chase
Bank, as Administrative Agent. Terms defined in the Credit Agreement are used
herein with the same meanings.
We have examined originals or copies, certified or otherwise identified
to my/our satisfaction, of such documents, corporate records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as we have deemed necessary or advisable for
purposes of this opinion. In our examination, we have assumed the genuineness of
the signatures of Persons signing the Credit Agreement, the authority of such
Persons signing on behalf of the parties thereto (other than the Borrower) and
the due authorization, execution and delivery of all documents by the parties
thereto (other than the Borrower).
Upon the basis of the foregoing, we are of the opinion that:
1. The Borrower (a) is a corporation duly organized, validly existing
and in good standing under the laws of Nebraska, (b) has all requisite power and
authority to carry on its business as now conducted and (c) except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.
2. The Transactions are within the Borrower's corporate powers and have
been duly authorized by all necessary corporate and, if required, stockholder
action. The Credit Agreement has been duly executed and delivered by the
Borrower and constitutes a legal, valid and binding obligation of the Borrower,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors' rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.
B-1
3. The Transactions (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental Authority,
except such as have been obtained or made and are in full force and effect, (b)
will not violate any applicable law or regulation or the charter, by-laws or
other organizational documents of the Borrower or any of its Subsidiaries or any
order of any Governmental Authority, (c) will not violate or result in a default
under any indenture, agreement or other instrument binding upon the Borrower or
any of its Subsidiaries or its assets, or give rise to a right thereunder to
require any payment to be made by the Borrower or any of its Subsidiaries, and
(d) will not result in the creation or imposition of any Lien on any asset of
the Borrower or any of its Subsidiaries.
4. There are no actions, suits or proceedings by or before any
arbitrator or Governmental Authority pending against or, to our knowledge,
threatened against or affecting the Borrower or any of its Subsidiaries (a) as
to which there is a reasonable possibility of an adverse determination and that,
if adversely determined, could reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect (other than the Disclosed Matters)
or (b) that involve the Credit Agreement or the Transactions.
5. Neither the Borrower nor any of its Subsidiaries is an "investment
company" as defined in, or subject to regulation under, the Investment Company
Act of 1940.
We are members of the bar of the State of Nebraska and the foregoing
opinion is limited to the laws of the State of Nebraska and the Federal laws of
the United States of America. We note that the Credit Agreement is governed by
the laws of the State of New York and, for purposes of the opinion expressed in
paragraphs 2 and 3 above, we have assumed that the laws of the State of New York
do not differ from the laws of Nebraska in any manner that would render such
opinion incorrect. This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other purpose
or relied upon by any other Person (other than your successors and assigns as
Lenders and Persons that acquire participations in your Loans) without our prior
written consent.
Very truly yours,
▇-▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
May 8, 2007
To the Lenders and the Administrative
Agent Referred to Below
c/o JPMorgan Chase Bank, N.A., as
Administrative Agent
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We have participated in the preparation of the Amended and Restated
Credit Agreement (the "CREDIT AGREEMENT") dated as of May 8, 2007 among Nelnet,
Inc., a Nebraska corporation (the "BORROWER"), the Lenders from time to time
parties thereto (the "LENDERS"), JPMorgan Chase Bank, N.A., as Administrative
Agent (the "ADMINISTRATIVE AGENT"), and Citibank N.A., as Syndication Agent, and
have acted as special counsel to the Administrative Agent for the purpose of
rendering this opinion pursuant to Section 4.01(f) of the Credit Agreement.
Terms defined in the Credit Agreement are used herein as therein defined.
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of such documents, corporate records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as we have deemed necessary or advisable for
purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that the Credit
Agreement constitutes a valid and binding agreement of the Borrower enforceable
in accordance with its terms except as the same may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and by general
principles of equity.
We are members of the Bar of the State of New York and the foregoing
opinion is limited to the laws of the State of New York and the federal laws of
the United States of America. In giving the foregoing opinion, (i) we have
assumed without independent investigation that the execution, delivery and
performance by the Borrower of the Credit Agreement are within the Borrower's
corporate powers and have been duly authorized by all necessary corporate action
and (ii) we express no opinion as to the effect (if any) of any law of any
jurisdiction (except the State of New York) in which any Lender is located which
limits the rate of interest that such Lender may charge or collect.
C-1
This opinion is rendered solely to you in connection with the above
matter. This opinion may not be relied upon by you for any other purpose or
relied upon by any other person without our prior written consent.
Very truly yours,
C-2
EXHIBIT D
FORM OF COMPLIANCE CERTIFICATE
JPMorgan Chase Bank, N.A.,
as Administrative Agent
Attention: ________________
Re: Compliance Certificate
Ladies and Gentlemen:
Reference is made to the Amended and Restated Credit Agreement dated as
of May 8, 2007 among Nelnet, Inc., (the "BORROWER") and the Lenders and Agents
from time to time parties thereto (such agreement, as amended and in effect from
time to time, the "Agreement"); capitalized terms used herein without definition
shall have the meanings assigned those terms in the Agreement.
This Certificate is furnished to the Administrative Agent for the
benefit of the Lenders pursuant to Section 5.01 of the Agreement.
The undersigned, ______________________, hereby certifies to the
Administrative Agent for the benefit of the Lenders as follows:
1. Authority. I am the duly elected, qualified and acting __________ of the
Borrower.
2. Fiscal Period. This certificate is for the fiscal period ended
___________ __, 200__ (the "CERTIFICATION DATE").
3. Financial Statements.
(a) The accompanying consolidated statements of operations,
stockholders' equity and cash flows of the Borrower and its Consolidated
Subsidiaries for the fiscal quarter ended on the Certification Date [and
for the then elapsed portion of the fiscal year] and the related
consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as at the Certification Date, together in each case with
the corresponding figures in comparative form for the previous fiscal
year, present fairly in all material respects the financial condition
and results of operations of the Borrower and its Consolidated
Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to year-end audit adjustments and the
absence of footnotes.
D-1
[(b)] The accompanying statements of operations, stockholders' equity
and cash flows for the fiscal quarter ended on the Certification Date
[and for the then elapsed portion of the fiscal year] and the related
balance sheet of the Borrower as at the Certification Date, together in
each case with the corresponding figures in comparative form for the
previous fiscal year, present fairly in all material respects the
financial condition and results of operations of the Borrower on a
consolidated basis in accordance with GAAP consistently applied, subject
to [year-end audit adjustments and] the absence of footnotes.
4. No Default. To my knowledge, no Default has occurred or is continuing as
of the date of this certificate, except as set forth below:
5. Minimum Consolidated Net Worth (Section 6.03).
(a) Consolidated Net Worth at Certification Date $_________
(b) Calculation of Compliance Level
(i) Compliance level at preceding Certification Date (from prior
Compliance Certificate) $__________
(ii) Increase in Consolidated Net Worth attributable to the
issuance of capital stock of the Borrower since the
preceding Certification Date $__________
[(iii) 50% of Consolidated Net Income for the fiscal
year ended at the Certification Date] [$________]
Compliance Level at Certification Date ((i) plus (ii)
[plus (iii)]) $__________
[(c) Calculation of Consolidated Net Income
Consolidated net income (from income statement) $__________
[plus] [minus] Derivatives market value adjustment $__________
Consolidated Net Income [$________]
D-2
6. Adjusted EBITDA to Corporate Debt Interest (Section 6.04)
(a) Unencumbered Assets at Certification Date
(I) Eligible Assets at Certification Date not subject to any
Lien:
(i) Eligible Securities $__________
(ii) Student loans receivable $__________
(iii) Cash and cash equivalents $__________
(iv) Accrued interest receivable $__________
(v) Accounts receivable $__________
(vi) Total (i) - (v) $__________
(II) Eligible Assets subject to release from any Lien within
60 days from the Certification Date:
(i) Eligible Securities $__________
(ii) Student loans receivable $__________
(iii) Cash and cash equivalents $__________
(iv) Accrued interest receivable $__________
(v) Accounts receivable $__________
(vi) Total (i) - (v) $__________
(III) Unencumbered Assets at Certification Date
((I)(vi) plus (II)(vi)) $__________
(b) Calculation of Adjusted EBITDA
(I) Pre-Tax Income (consolidated net income before
income taxes, minority interests and extraordinary
items, if any) $__________
(II) Additions to the extent deducted in determining
Pre-Tax Income:
(i) Corporate Debt Interest $__________
(ii) Depreciation and amortization $__________
(iii) 9.5% excess statutory yield amount
(if negative) $__________
D-3
(iv) Derivatives market value adjustment (if
negative) $__________
(v) Total additions $__________
(III) Deductions from Pre-Tax Income to the
extent included therein: $__________
(i) Variable-rate floor income $__________
(ii) 9.5% excess statutory yield amount
(if positive) $__________
(iii) Derivatives market value adjustment (if
positive) $__________
(iv) Total deductions $__________
(IV) Adjusted EBITDA (I plus II(v)
minus III(iv)) $__________
(c) Calculation of Ratio
(b)(iv) / (b)(II)(ii) (must be not less than 3.0, if (a)(III)
above is less than $250,000,000, and not less than 2.50 if
(a)(III) above is $250,000,000 or more) __________
7. Subsidiary Indebtedness (Section 6.05)
Aggregate principal amount of Indebtedness of Subsidiaries
(other than Intercompany Indebtedness) outstanding at the
Certification Date (must not exceed $25,000,000) $__________
8. Non-FFELP Loans To All Loans (Section 6.06) $__________
(a) Aggregate amount of Non-FFELP Loans owned by the
Borrower and its Consolidated Subsidiaries at the
Certification Date $__________
(b) Aggregate amount of all student loans receivable
owned by the Borrower and its Consolidated Subsidiaries at
the Certification Date $__________
(c) (a) / (b) (must not equal or exceed 0.15) __________
D-4
IN WITNESS WHEREOF, the undersigned has executed this Certificate on the
date set forth below.
-------------------------------
Name:
Title:
Dated: _______________, 200__
D-5
