EXHIBIT 10.16
$146,000,000
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of June 25, 2003
Among
BOCA RESORTS HOTEL CORPORATION,
as BORROWER,
THE INITIAL LENDERS NAMED HEREIN,
DEUTSCHE BANK SECURITIES INC.
as SOLE BOOK RUNNING MANAGER and LEAD ARRANGER,
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as INITIAL ISSUING BANK AND ADMINISTRATIVE AGENT,
FLEET NATIONAL BANK
as SYNDICATION AGENT,
and
THE BANK OF NOVA SCOTIA,
NEW YORK AGENCY
as DOCUMENTATION AGENT
T A B L E O F C O N T E N T S
Page
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms..............................................................................1
SECTION 1.02. Computation of Time Periods; Other Definitional Provisions........................................22
SECTION 1.03. Accounting Terms..................................................................................22
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.02. Making the Advances...............................................................................22
SECTION 2.02(A). Issuance of and Drawings and Reimbursement Under Letters of Credit.............................24
SECTION 2.03 ..................................................................................................25
SECTION 2.04. Termination or Reduction of the Commitments.......................................................26
SECTION 2.05. Prepayments.......................................................................................26
SECTION 2.06. Interest..........................................................................................27
SECTION 2.07. Fees..............................................................................................27
SECTION 2.08. Conversion of Advances............................................................................28
SECTION 2.10. Payments and Computations.........................................................................30
SECTION 2.11. Taxes.............................................................................................31
SECTION 2.12. Sharing of Payments, Etc..........................................................................33
SECTION 2.13. Use of Proceeds...................................................................................33
SECTION 2.14. Evidence of Debt..................................................................................33
SECTION 2.15. Cash Management...................................................................................34
SECTION 2.16. Reallocation of Pro Rata Shares...................................................................35
SECTION 2.17. Amended and Restated Promissory Note Legend.......................................................35
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Closing Date..............................................................35
SECTION 3.02. Conditions Precedent to Each Borrowing and Issuance...............................................39
SECTION 3.03. Determinations Under Section 3.01.................................................................40
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower....................................................40
ARTICLE V
COVENANTS
SECTION 5.01. Affirmative Covenants.............................................................................48
SECTION 5.02. Negative Covenants................................................................................52
SECTION 5.03. Borrower Reporting Requirements...................................................................58
SECTION 5.04. Parent Guarantor Reporting Requirements...........................................................61
SECTION 5.05. Parent Guarantor Covenants........................................................................62
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ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default.................................................................................63
SECTION 6.02 Actions in Respect of the Letters of Credit upon Default...........................................65
ARTICLE VII
THE AGENTS
SECTION 7.01. Authorization and Action..........................................................................66
SECTION 7.02. Administrative Agent's, Lead Arranger's, Syndication Agent's and Documentation Agent's
Reliance, Etc..............................................................................66
SECTION 7.03. DBTCA, DBSI, Fleet, ScotiaBank and Affiliates.....................................................67
SECTION 7.04. Lender Party Credit Decision......................................................................67
SECTION 7.05. Indemnification...................................................................................67
SECTION 7.06. Successor Administrative Agents...................................................................68
SECTION 7.07. Lead Arranger, Syndication Agent and Documentation Agent..........................................69
SECTION 7.08. Collateral Documents; Secured Party Action........................................................69
SECTION 7.09. Certain Actions after an Event of Default.........................................................70
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc...................................................................................70
SECTION 8.02. Notices, Etc......................................................................................71
SECTION 8.03. No Waiver; Remedies...............................................................................71
SECTION 8.04. Costs and Expenses................................................................................71
SECTION 8.05. Right of Set-off..................................................................................74
SECTION 8.06. Binding Effect....................................................................................74
SECTION 8.07. Assignments and Participations....................................................................75
SECTION 8.08. Execution in Counterparts.........................................................................77
SECTION 8.09. Jurisdiction, Etc.................................................................................77
SECTION 8.10. Governing Law.....................................................................................77
SECTION 8.11. Waiver of Jury Trial..............................................................................77
ARTICLE IX
L/C CASH COLLATERAL ACCOUNT
SECTION 9.01. Cash Collateral Account...........................................................................78
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS SECOND AMENDED AND RESTATED CREDIT AGREEMENT (as amended,
modified, restated or supplemented from time to time, this "AGREEMENT") dated as
of June 25, 2003 among BOCA RESORTS HOTEL CORPORATION (formerly known as Florida
Panthers Hotel Corporation), a Delaware corporation (the "BORROWER"), the banks,
financial institutions and other institutional lenders listed on the signature
pages hereof as the initial lenders (the "INITIAL LENDERS"), DEUTSCHE BANK
SECURITIES INC. (formerly known as Deutsche Banc Alex. ▇▇▇▇▇) ("DBSI"), as sole
book running manager and sole lead arranger (the "LEAD ARRANGER"), FLEET
NATIONAL BANK ("Fleet"), as syndication agent (the "SYNDICATION AGENT"), THE
BANK OF NOVA SCOTIA, NEW YORK AGENCY ("ScotiaBank"), as documentation agent (the
"DOCUMENTATION AGENT"), and DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly known
as Bankers Trust Company) ("DBTCA"), as the initial issuer of Letters of Credit
(as hereinafter defined) (in such capacity, the "INITIAL ISSUING BANK") and as
administrative agent (in such capacity, together with any successors appointed
pursuant to Article VII, the "ADMINISTRATIVE AGENT") for the Lender Parties (as
hereinafter defined).
PRELIMINARY STATEMENTS:
(1) The Borrower is a wholly owned Subsidiary (as defined
herein) of Boca Resorts, Inc., a Delaware corporation (the "PARENT GUARANTOR"),
and the indirect owner of all of the Borrowing Base Properties (as hereinafter
defined).
(2) Pursuant to that certain Credit Agreement dated as of
April 21, 1999 ((i) as amended by that certain Waiver, Consent and
Acknowledgment dated as of November 15, 1999, and effective as of June 30, 1999,
and that certain First Amendment to Credit Agreement dated as of July 31, 2000,
and (i) as amended and restated pursuant to that certain Amended and Restated
Credit Agreement dated as of November 21, 2001, collectively, the "EXISTING
AGREEMENT") among the Borrower, the guarantors party thereto, the lenders
described therein, Fleet National Bank, as syndication agent, and DBTCA, as
administrative agent, such lenders extended certain commitments to make a
certain credit facility available to the Borrower.
(3) The Borrower, the Administrative Agent, the Lead Arranger,
the Syndication Agent, the Documentation Agent, the lenders party to the
Existing Agreement desire to amend and restate the Existing Agreement to extend
the Termination Date (as defined therein) of the credit facility provided
thereunder and to make certain other amendments to the Existing Agreement, all
upon the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises set forth
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree to amend and restate the
Existing Agreement to read in its entirety as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"ADJUSTED EBITDA" means, with respect to any Person, for any
Rolling Period and at any date of determination, the sum of EBITDA for such
Person for such Rolling Period, PLUS the increase or MINUS the decrease in the
amount of deferred Premier Club membership fees reflected as a component of
deferred revenue on the balance sheet of such Person at the beginning and end of
such Rolling Period PLUS the decrease or MINUS the increase in Premier Club
notes receivable reflected on such balance sheet (without taking into account
any write-offs related to such amounts) LESS all expenses during such Rolling
Period in connection with such Premier Club operations (which were not otherwise
included in computing net income for such Rolling Period).
"ADVANCE" means a Revolving Credit Advance or a Letter of
Credit Advance.
"ADMINISTRATIVE AGENT" has the meaning specified in the
Preamble to this Agreement.
"ADMINISTRATIVE AGENT'S ACCOUNT" means the account of the
Administrative Agent maintained by the Administrative Agent at the Federal
Reserve Bank of New York, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ABA No.
021 001 033, for further credit to Account No. 99 401268, Commercial Loan
Division, or such other account maintained by the Administrative Agent and
designated by the Administrative Agent in a written notice to the Lender Parties
and the Borrower.
"AFFILIATE" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common control
with such Person or is a director or officer of such Person. For purposes of
this definition, the term "control" (including the terms "controlling",
"controlled by" and "under common control with") of a Person means the
possession, direct or indirect, of the power to vote 10% or more of the Voting
Interests of such Person or to direct or cause the direction of the management
and policies of such Person, whether through the ownership of Voting Interests,
by contract or otherwise.
"AGREEMENT VALUE" means, for each Hedge Agreement, on any date
of determination, an amount equal to: (a) in the case of a Hedge Agreement
documented pursuant to the Master Agreement (Multicurrency-Cross Border)
published by the International Swap and Derivatives Association, Inc. (the
"MASTER AGREEMENT"), the amount, if any, that would be payable by any Loan Party
or any of its Subsidiaries to its counterparty to such Hedge Agreement, as if
(i) such Hedge Agreement was being terminated early on such date of
determination, (ii) such Loan Party or Subsidiary was the sole "Affected Party",
and (iii) the respective counterparty to such Hedge Agreement was the sole party
determining such payment amount (with the respective counterparty to such Hedge
Agreement making such determination pursuant to the provisions of the form of
Master Agreement (as defined herein); or (b) in the case of a Hedge Agreement
traded on an exchange, the ▇▇▇▇-to-market value of such Hedge Agreement, which
value will be the unrealized loss on such Hedge Agreement to the Loan Party or
Subsidiary of a Loan Party party to such Hedge Agreement determined by the
respective counterparty to such Hedge Agreement based on the settlement price of
such Hedge Agreement on such date of determination; or (c) in all other cases,
the ▇▇▇▇-to-market value of such Hedge Agreement, which value will be the
unrealized loss on such Hedge Agreement to the Loan Party or Subsidiary of a
Loan Party party to such Hedge Agreement determined by the respective
counterparty to such Hedge Agreement as the amount, if any, by which (i) the
present value of the future cash flows to be paid by such Loan Party or
Subsidiary exceeds (ii) the present value of the future cash flows to be
received by such Loan Party or Subsidiary pursuant to such Hedge Agreement;
capitalized terms used and not otherwise defined in this definition shall have
the respective meanings set forth in the above-described Master Agreement.
"APPLICABLE LENDING OFFICE" means, with respect to each Lender
Party, such Lender Party's Domestic Lending Office in the case of a Base Rate
Advance and such Lender Party's Eurodollar Lending Office in the case of a
Eurodollar Rate Advance.
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"APPLICABLE MARGIN" means, for Base Rate Borrowings, 1% per
annum, and, for Eurodollar Rate Borrowings, 3% per annum.
"APPRAISED VALUE" means the fair market value of the Borrowing
Base Properties at the time of any determination by the Administrative Agent of
the Borrowing Base Amount, based on the most recent appraisals obtained by the
Administrative Agent and as provided herein, for each of the Borrowing Base
Properties.
"APPROVED FUND" means, with respect to any Lender Party that
is a fund that invests in bank loans, any other fund that invests in bank loans
and is advised or managed by the same investment advisor as such Lender Party or
by an Affiliate of such investment advisor.
"ASSIGNED RIGHTS AND OBLIGATIONS" has the meaning set forth in
Section 2.16.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
entered into by a Lender Party and an Eligible Assignee and accepted by the
Administrative Agent, in accordance with Section 8.07 and in substantially the
form of EXHIBIT C hereto.
"AVAILABLE AMOUNT" of any Letter of Credit means, at any time,
the maximum amount available to be drawn under such Letter of Credit at such
time (assuming compliance at such time with all conditions to drawing).
"BAHIA MAR" means the 296-room resort, hotel and related
improvements, facilities and assets, including, without limitation, the
Mortgaged Property (as defined in the Bahia Mar Mortgage), situated on that
certain real property located in Broward County, Florida, as more fully
described in the Bahia Mar Mortgage, and commonly known as the Bahia Mar Hotel.
"BASE RATE" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be equal to
the higher of:
(a) the rate of interest announced publicly by DBTCA in New
York, New York, from time to time, as its prime lending rate (the
"PRIME LENDING RATE") (the Prime Lending Rate is a reference rate and
does not necessarily represent the lowest or best rate actually charged
to any customer; DBTCA may make commercial loans or other loans at
rates of interest at, above or below the Prime Lending Rate); and
(b) 1/2 of 1% per annum above the Federal Funds Rate.
"BASE RATE ADVANCE" means an Advance that bears interest as
provided in Section 2.06(a)(i).
"BLOCKED ACCOUNT AGREEMENT" means the Blocked Account
Agreement dated as of April 21, 1999 among the Borrower, FPH, certain Subsidiary
Guarantors, the Administrative Agent and Bank of America, N.A. (formerly known
as NationsBank, N.A.).
"BOOK NET WORTH" shall be calculated in accordance with GAAP.
"BORROWER" has the meaning specified in the Preamble to this
Agreement.
"BORROWER'S ACCOUNT" means such account of the Borrower as the
Borrower and the Administrative Agent may from time to time designate as the
"Borrower's Account".
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"BORROWING" means a borrowing consisting of simultaneous
Advances of the same Type made by the Lenders.
"BORROWING BASE AMOUNT" means, as of any date of
determination, an amount determined by the Administrative Agent as the lesser of
(a) an amount which is equal to the combined fair market value of the Borrowing
Base Properties, in each case based on the most recent Appraised Value,
MULTIPLIED by the "Aggregate Loan to Value Ratio" set forth in the first row of
the table below; (b) an amount which is equal to the Reserve Adjusted EBITDA
determined on a combined basis for the Operating Subsidiaries for the Rolling
Period ending on or immediately prior to such date of determination, DIVIDED BY
the Debt Service Rate DIVIDED BY the "Debt Service Coverage Ratio" set forth in
the second row of the table below; and (c) an amount which is equal to the
Reserve Adjusted EBITDA for such Rolling Period, MULTIPLIED BY the "Reserve
Adjusted EBITDA factor" set forth in the third row of the table below.
After First
Transfer of After Second
Existing Borrowing Base After Transfer Transfer of
Borrowing Base Property (Other of Registry if Borrowing Base
Properties than Registry) First Transfer Property
-------------- ---------------- -------------- --------------
Aggregate Loan to 50% 50% 45% 40%
Value Ratio
Debt Service 1.75 1.75 1.85 2.00
Coverage Ratio
Reserve Adjusted 4.90 4.90 4.50 4.00
EBITDA factor
"BORROWING BASE CERTIFICATE" means a certificate in
substantially the form of EXHIBIT G hereto, duly certified by the Chief
Financial Officer or Chief Accounting Officer of the Borrower.
"BORROWING BASE PROPERTIES" means, subject to the provisions
of Section 5.02(e)(iii), the following four properties: Bahia Mar, Pier 66,
Registry and Edgewater; PROVIDED, HOWEVER, that to the extent any of the
Borrowing Base Properties are sold pursuant to Section 5.02(e)(iii), such
property shall no longer be considered a Borrowing Base Property.
"BUSINESS DAY" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings are
carried on in the London interbank market.
"CAPITAL EXPENDITURES" means, for any Person as of any date of
determination, the sum of, without duplication, (a) all cash expenditures made,
directly or indirectly, by such Person or any of its Subsidiaries during such
period for equipment, fixed assets, real property or improvements, or for
replacements or substitutions therefor or additions thereto, that have been or
should be, in accordance with GAAP, reflected as additions to property, plant or
equipment on a Consolidated balance sheet of such Person PLUS (b) the aggregate
principal amount of all Debt (including Obligations under Capitalized Leases)
assumed or incurred in connection with any such expenditures.
"CAPITALIZED LEASES" means all leases that have been or should
be, in accordance with GAAP, recorded as capitalized leases. For purposes of
this definition, the purchase price of equipment that is purchased
simultaneously with the trade-in of existing equipment or with insurance
proceeds shall be included in Capital Leases only to the extent of the gross
amount of such purchase price LESS the credit
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granted by the seller of such equipment for the equipment being traded in at
such time or the amount of such proceeds, as the case may be.
"CASH EQUIVALENTS" means any of the following, to the extent
owned by the Operating Subsidiaries free and clear of all Liens other than Liens
created under the Collateral Documents and having a maturity of not greater than
180 days (except, with respect to clause (a) below, not greater than one year
and, with respect to clauses (b) and (c) below, not greater than 90 days) from
the date of acquisition thereof: (a) readily marketable direct obligations of
the government of the United States or any agency or instrumentality thereof or
obligations unconditionally guaranteed by the full faith and credit of the
government of the United States; (b) insured certificates of deposit of or time
deposits with any commercial bank that is a Lender Party or a member of the
Federal Reserve System, issues (or the parent of which issues) commercial paper
rated as described in clause (c), is organized under the laws of the United
States or any state thereof and has combined capital and surplus of at least $1
billion; (c) commercial paper in an aggregate amount of not more than $250,000
per issuer outstanding at any time, issued by any corporation organized under
the laws of any state of the United States and rated at least "Prime-1" (or the
then equivalent grade) by ▇▇▇▇▇'▇ Investors Service, Inc. or "A-1" (or the then
equivalent grade) by Standard & Poor's Ratings Group, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.; (d) repurchase obligations with a term of not more
than seven days for underlying securities of the types described in clauses (b)
and (c) above entered into with any financial institution meeting the
qualifications specified in clause (b) above; or (e) money market or mutual
funds that invest solely in Cash Equivalents of the types described in clauses
(a), (b) and (c) above.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the U.S.
Environmental Protection Agency.
"CHANGE OF CONTROL" means the occurrence of any of the
following: (a) the direct or indirect sale, transfer, conveyance or other
disposition (other than by way of merger or consolidation), in one or a series
of related transactions, of all or substantially all of the properties or assets
of the Parent Guarantor and its Restricted Subsidiaries (as defined in the
Indenture), taken as a whole, to any "person" (as that term is used in Section
13(d)(3) of the Exchange Act) other than to H. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (the "PRINCIPAL"),
80% (or more) owned Subsidiary, or any immediate family member of the Principal
(the "RELATED PARTIES"); (b) the adoption of a plan relating to the liquidation
or dissolution of the Parent Guarantor; (c) the consummation of any transaction
(including, without limitation, any merger or consolidation) the result of which
is that any "person" (as defined above) other than the Principal and his Related
Parties becomes the beneficial owner, directly or indirectly, of Voting Stock
(as defined in the Indenture) of the Parent Guarantor with the power to vote 50%
or more of the total votes entitled to be cast on any matter submitted to a vote
of shareholders; (d) during any consecutive two-year period, individuals who at
the beginning of such period constituted the Board of Directors of the Parent
Guarantor (together with any new directors whose election to such Board of
Directors, or whose nomination for election by the stockholders of the Parent
Guarantor, was approved by a vote of a majority of the directors then still in
office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of the Parent
Guarantor then in office; or (e) the Parent Guarantor consolidates with, or
merges with or into, any Person, or any Person consolidates with, or merges with
or into, the Parent Guarantor, in any such event pursuant to a transaction in
which any of the outstanding Voting Stock of the Parent Guarantor or such other
Person is converted into or exchanged for cash, securities or other property,
other than any such transaction where the Voting Stock of the Parent Guarantor
outstanding immediately prior to such transaction is converted into or exchanged
for Voting
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Stock, other than Disqualified Stock (as defined in the Indenture), of the
surviving or transferee Person constituting a majority of the outstanding shares
of such Voting Stock of such surviving or transferee Person (immediately after
giving effect to such issuance) and no Person other than the Principal and his
Related Parties, becomes the beneficial owner, directly or indirectly, of Voting
Stock of such Person with the power to vote 50% or more of the total votes
entitled to be cast on any matter submitted to a vote of shareholders.
"CLOSING DATE" means June 25, 2003.
"COLLATERAL" means all "Collateral" referred to in the
Collateral Documents and all other property that is or is intended to be subject
to any Lien in favor of the Administrative Agent for the benefit of the Lender
Parties.
"COLLATERAL DOCUMENTS" means the Security Agreements, the
Mortgages, the Environmental Indemnity Agreement, this Agreement (to the extent
of Article IX hereof) and any other agreement that creates or purports to create
a Lien in favor of the Administrative Agent for the benefit of the Lender
Parties.
"COMMITMENT" means a Revolving Credit Commitment or a Letter
of Credit Commitment.
"CONSOLIDATED" refers, with respect to any Person, to the
consolidation of accounts of such Person and its Subsidiaries in accordance with
GAAP.
"CONTINGENT OBLIGATION" means, with respect to any Person, any
Obligation or arrangement of such Person to guarantee or intended to guarantee
any Debt, leases, dividends or other payment Obligations ("PRIMARY OBLIGATIONS")
of any other Person (the "PRIMARY OBLIGOR") in any manner, whether directly or
indirectly, including, without limitation, (a) the direct or indirect guarantee,
endorsement (other than for collection or deposit in the ordinary course of
business), co-making, discounting with recourse sale with recourse by such
Person of the Obligation of a primary obligor, (b) the Obligation to make
take-or-pay or similar payments, if required, regardless of nonperformance by
any other party or parties to an agreement or (c) any Obligation of such Person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (A) for the purchase or payment of any such primary obligation or
(B) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, assets, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation or (iv) otherwise to assure
or hold harmless the holder of such primary obligation against loss in respect
thereof. The amount of any Contingent Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the primary obligation in respect
of which such Contingent Obligation is made (or, if less, the maximum amount of
such primary obligation for which such Person may be liable pursuant to the
terms of the instrument evidencing such Contingent Obligation) or, if not stated
or determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder), as determined by such
Person in good faith.
"CONVERSION", "CONVERT" and "CONVERTED" each refer to a
conversion of Advances of one Type into Advances of the other Type pursuant to
Section 2.08 or 2.09.
"DBSI" has the meaning specified in the Preamble to this
Agreement.
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"DBTCA" has the meaning specified in the Preamble to this
Agreement.
"DEBT" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all Obligations, contingent
or otherwise, of such Person for the deferred purchase price of property or
services (other than trade payables not overdue by more than 60 days incurred in
the ordinary course of such Person's business), (c) all Obligations, contingent
or otherwise, of such Person evidenced by notes, bonds, debentures or other
similar instruments, (d) all Obligations, contingent or otherwise, of such
Person created or arising under any conditional sale or other title retention
agreement with respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such property), (e) all
Obligations, contingent or otherwise, of such Person as lessee under Capitalized
Leases, (f) all Obligations, contingent or otherwise, of such Person under
acceptance, letter of credit or similar facilities, (g) all Obligations of such
Person to purchase, redeem, retire, defease or otherwise make any payment in
respect of any Equity Interests in such Person or any other Person or any
warrants, rights or options to acquire such capital stock, valued, in the case
of Redeemable Preferred Interests, at the greater of its voluntary or
involuntary liquidation preference PLUS accrued and unpaid dividends, (h) all
Obligations of such Person in respect of Hedge Agreements, valued at the
Agreement Value thereof, (i) all Contingent Obligations of such Person and (j)
all indebtedness and other payment Obligations referred to in clauses (a)
through (i) above of another Person secured by (or for which the holder of such
Debt has an existing right, contingent or otherwise, to be secured by) any Lien
on property (including, without limitation, accounts and contract rights) owned
by such Person, even though such Person has not assumed or become liable for the
payment of such indebtedness or other payment Obligations.
"DEBT SERVICE RATE" means, as of any date of determination,
the greatest of (i) the average weighted interest rate applicable to Advances at
such date; (ii) 9% and (iii) debt service constant on a 25-year fully amortizing
note secured by a mortgage bearing interest at the 7-year U.S. Treasury
obligation rate effective on such date based on the rate quoted for the 7-year
U.S. Treasury obligation interpolated "ICUR 7" on the Bloomberg service (or any
successor thereto) plus 3.25%, which rate as determined at the Administrative
Agent's reasonable discretion shall be conclusive and binding for all purposes,
absent manifest error.
"DEFAULT" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be given or
time elapse or both.
"DEFAULTED ADVANCE" means, with respect to any Lender Party at
any time, the portion of any Advance required to be made by such Lender Party to
the Borrower pursuant to Section 2.01 or 2.02 at or prior to such time which has
not been made by such Lender Party or by the Administrative Agent for the
account of such Lender Party pursuant to Section 2.02(d) as of such time.
"DEFAULTED AMOUNT" means, with respect to any Lender Party at
any time, any amount required to be paid by such Lender Party to the
Administrative Agent or any other Lender Party hereunder or under any other Loan
Document at or prior to such time which has not been so paid as of such time,
including, without limitation, any amount required to be paid by such Lender
Party to (a) the Issuing Bank pursuant to Section 2.02(A)(c) to purchase a
portion of a Letter of Credit Advance made by the Issuing Bank, (b) the
Administrative Agent pursuant to Section 2.02(d) to reimburse the Administrative
Agent for the amount of any Advance made by the Administrative Agent for the
account of such Lender Party, (c) any other Lender Party pursuant to Section
2.12 to purchase any participation in Advances owing to such other Lender Party
and (d) the Administrative Agent or the Issuing Bank pursuant to Section 7.05 to
reimburse the Administrative Agent or the Issuing Bank for such Lender Party's
ratable share of any amount required to be paid by the Lender Parties to the
Administrative Agent or the Issuing Bank as provided therein.
7
"DEFAULTING LENDER" means, at any time, any Lender Party that,
at such time (a) owes a Defaulted Advance or a Defaulted Amount or (b) shall
take any action or be the subject of any action or proceeding of a type
described in Section 6.01(f).
"DOMESTIC LENDING OFFICE" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Domestic Lending
Office" opposite its name on SCHEDULE I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender Party, as the case may be, or
such other office of such Lender Party as such Lender Party may from time to
time specify to the Borrower and the Administrative Agent.
"DOMESTIC SUBSIDIARY" of any Person means any Subsidiary other
than a Foreign Subsidiary.
"EBITDA" means, with respect to any Person, for any Rolling
Period and as of any date of determination, net income PLUS (a) an amount equal
to any extraordinary loss PLUS any net loss realized in connection with an asset
sale, to the extent such losses were deducted in computing net income, PLUS (b)
the provision for taxes based on income or profits of such Person for such
Rolling Period, to the extent such provision for taxes was included in computing
net income, PLUS (c) Interest Expense of such Person for such Rolling Period to
the extent such expense was deducted in computing net income, PLUS (d)
depreciation and amortization expense for such Rolling Period to the extent such
expense was deducted in computing net income less (e) an amount equal to any
extraordinary gain PLUS any net gain realized in connection with an asset sale;
PROVIDED that if any asset has been (X) purchased subsequent to the commencement
of such Rolling Period, EBITDA for the period beginning on the first day of such
Rolling Period shall be increased by the amount of EBITDA for such Rolling
Period associated with such asset purchased, and (Y) sold subsequent to the
commencement of such Rolling Period, EBITDA for the period beginning on the
first day of such Rolling Period shall be reduced by the amount of EBITDA
associated with such asset sold.
"EDGEWATER" means the 126-room resort and hotel and related
improvements, facilities and assets, including, without limitation, the
Mortgaged Property (as defined in the Edgewater Mortgage), situated on that
certain real property located in ▇▇▇▇▇▇▇ County, Florida, as more fully
described in the Edgewater Mortgage, and commonly known as the Edgewater Hotel.
"ELIGIBLE ASSIGNEE" means (a) with respect to the Revolving
Credit Facility, (i) any "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) or any "accredited investor" (as defined in
Section 2(15) of the Securities Act); (ii) a Lender Party; (iii) an Affiliate of
a Lender Party; (iv) a commercial bank organized under the laws of the United
States, or any state thereof, and having a combined capital and surplus of at
least $400,000,000; (v) a savings and loan association or savings bank organized
under the laws of the United States, or any state thereof, and having a combined
capital and surplus of at least $400,000,000; (vi) a commercial bank organized
under the laws of any other country that is a member of the OECD or has
concluded special lending arrangements with the International Monetary Fund
associated with its general arrangements to Borrow or a political subdivision of
any such country, and having a combined capital and surplus of at least
$500,000,000, so long as such bank is acting through a branch or agency located
in the United States and (vii) a finance company, insurance company or other
financial institution or fund (whether a corporation, partnership, trust or
other entity) that is engaged in making, purchasing or otherwise investing in
commercial loans in the ordinary course of its business and having a combined
capital and surplus of at least $250,000,000, and (b) with respect to the Letter
of Credit Facility, a Person that is an Eligible Assignee under subclause (iv)
or (vi) of clause (a) of this definition (or any Affiliate of any such Person)
and is approved by the Administrative Agent; PROVIDED, HOWEVER, that neither any
Loan Party nor any Affiliate of a Loan Party shall qualify as an Eligible
Assignee under this definition.
8
"ENVIRONMENTAL ACTION" means any action, suit, demand, demand
letter, written claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent order or
consent agreement relating in any way to any Environmental Law, any
Environmental Permit or Hazardous Material or arising from alleged injury or
threat to health, safety or the environment, including, without limitation, (a)
by any governmental or regulatory authority for enforcement, cleanup, removal,
response, remedial or other actions or damages and (b) by any governmental or
regulatory authority or third party for damages, contribution, indemnification,
cost recovery, compensation or injunctive relief.
"ENVIRONMENTAL LAW" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment, health, safety or
natural resources, including, without limitation, those relating to the use,
handling, transportation, treatment, storage, disposal, release or discharge of
Hazardous Materials.
"ENVIRONMENTAL PERMIT" means any permit, approval,
identification number, license or other authorization required under any
Environmental Law.
"EQUITY INTERESTS" means, with respect to any Person, shares
of capital stock of (or other ownership or profit interests in) such Person,
warrants, options or other rights for the purchase or other acquisition from
such Person of shares of capital stock of (or other ownership or profit
interests in) such Person, securities convertible into or exchangeable for
shares of capital stock of (or other ownership or profit interests in) such
Person or warrants, rights or options for the purchase or other acquisition from
such Person of such shares (or such other interests), and other ownership or
profit interests in such Person (including, without limitation, partnership,
member or trust interests therein), whether voting or nonvoting, and whether or
not such shares, warrants, options, rights or other interests are authorized or
otherwise existing on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA AFFILIATE" means any Person that for purposes of Title
IV of ERISA is a member of the controlled group of any Loan Party, or under
common control with any Loan Party, within the meaning of Section 414 of the
Internal Revenue Code.
"ERISA EVENT" means (a) (i) the occurrence of a reportable
event, within the meaning of Section 4043 of ERISA, with respect to any Plan
unless the 30-day notice requirement with respect to such event has been waived
by the PBGC; or (ii) the requirements of subsection (1) of Section 4043(b) of
ERISA (without regard to subsection (2) of such Section) are met with respect to
a contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan,
and an event described in paragraph (9), (10), (11), (12) or (13) of Section
4043(c) of ERISA is reasonably expected to occur with respect to such Plan
within the following 30 days; (b) the application for a minimum funding waiver
with respect to a Plan; (c) the provision by the administrator of any Plan of a
notice of intent to terminate such Plan pursuant to Section 4041(a)(2) of ERISA
(including any such notice with respect to a plan amendment referred to in
Section 4041(e) of ERISA); (d) the cessation of operations at a facility of any
Loan Party or any ERISA Affiliate in the circumstances described in Section
4062(e) of ERISA; (e) the withdrawal by any Loan Party or any ERISA Affiliate
from a Multiple Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions for
imposition of a lien under Section 302(f) of ERISA shall have been met with
respect to any Plan; (g) the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of ERISA; or (h) the
institution by the PBGC of proceedings to terminate a Plan pursuant to Section
4042 of ERISA,
9
or the occurrence of any event or condition described in Section 4042 of ERISA
that constitutes grounds for the termination of, or the appointment of a trustee
to administer, such Plan.
"EUROCURRENCY LIABILITIES" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"EURODOLLAR LENDING OFFICE" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Eurodollar Lending
Office" opposite its name on SCHEDULE I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender Party (or, if no such office is
specified, its Domestic Lending Office), or such other office of such Lender
Party as such Lender Party may from time to time specify to the Borrower and the
Administrative Agent.
"EURODOLLAR RATE" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, an interest rate
per annum equal to the rate per annum obtained by dividing (a) the average of
the respective rates per annum (rounded upward to the next whole multiple of
1/16th of 1%) posted by each of the principal London offices of banks posting
rates as displayed on the Dow ▇▇▇▇▇ Markets screen, page 3750 or such other page
as may replace such page on such service for the purpose of displaying the
London interbank offered rate of major banks for deposits in U.S. Dollars, at
approximately 11:00 A.M. (London time) two Business Days before the first day of
such Interest Period for deposits in an amount substantially equal to DBTCA's
Eurodollar Rate Advance comprising part of such Borrowing to be outstanding
during such Interest Period and for a period equal to such Interest Period by
(b) a percentage equal to 100% MINUS the Eurodollar Rate Reserve Percentage for
such Interest Period.
"EURODOLLAR RATE ADVANCE" means an Advance that bears interest
as provided in Section 2.06(a)(ii).
"EURODOLLAR RATE RESERVE PERCENTAGE" for any Interest Period
for all Eurodollar Rate Advances comprising part of the same Borrowing means the
reserve percentage applicable two Business Days before the first day of such
Interest Period under regulations issued from time to time by the Board of
Governors of the Federal Reserve System (or any successor) for determining the
maximum reserve requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for a member bank of the
Federal Reserve System in New York City with respect to liabilities or assets
consisting of or including Eurocurrency Liabilities (or with respect to any
other category of liabilities that includes deposits by reference to which the
interest" rate on Eurodollar Rate Advances is determined) having a term equal to
such Interest Period.
"EVENTS OF DEFAULT" has the meaning specified in Section 6.01.
"EXCHANGE ACT" shall mean the U.S. Securities Exchange Act of
1934, as amended and as the same may be further amended, or any comparable
successor Applicable Law.
"EXISTING AGREEMENT" has the meaning specified in the
Preliminary Statements to this Agreement.
"FACILITY" means the Revolving Credit Facility and the Letter
of Credit Facility.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank
10
of New York, or, if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day for such transactions received
by the Administrative Agent from three Federal Funds brokers of recognized
standing selected by the Administrative Agent.
"FEE LETTER" means each agreement entered into between the
Parent Guarantor and each of the Administrative Agent and Lead Arranger or their
affiliates with respect to the payment of fees or other amounts relating to the
Facility.
"FF&E" means fixtures, furnishings and equipment at the
Borrowing Base Properties.
"FF&E RESERVE" means, for any Rolling Period, on a
Consolidated basis for the Borrowing Base Properties, a reserve maintained in
accordance with Section 5.01(h) by each Operating Subsidiary while any
Commitment hereunder shall exist to fund replacements of fixtures, furnishings
and equipment at the applicable Borrowing Base Property.
"FF&E RESERVE ACCOUNT" has the meaning specified in Section
2.15.
"FISCAL YEAR" means a fiscal year of the Parent Guarantor and
its Consolidated Subsidiaries ending on June 30 in any calendar year, as it may
be changed to the extent permitted by Section 5.02(i)(B).
"FIXED CHARGE COVERAGE RATIO" means, with respect to the
Parent Guarantor, for any Rolling Period and as of any date of determination,
the ratio of (a) Adjusted EBITDA for such Rolling Period to (b) the sum of (i)
Interest Expense for such Rolling Period, (ii) regularly scheduled principal
payments of Total Funded Debt made during such Rolling Period, and (iii) any
cash dividends, whether common or preferred, paid during such Rolling Period.
"FLEET" has the meaning specified in the Preamble to this
Agreement.
"FOREIGN SUBSIDIARY" means a Subsidiary that is organized
under the laws of a jurisdiction other than the United States or any state
thereof or the District of Columbia.
"FPH" means FPH Management, Inc., a Florida corporation.
"FRANCHISE AGREEMENTS" means the License Agreement dated as of
June 28, 1994 between Radisson Hotels International, Inc., as Licensor, and the
Manager, as Licensee, and the Hyatt Hotel Franchise Agreement dated November 14,
1994 between Hyatt Franchise Corporation, as Franchisor, and the Manager, as
Franchisee, as applicable.
"GAAP" has the meaning specified in Section 1.03.
"GUARANTIES" means the Parent Guaranty and the Subsidiary
Guaranty.
"GUARANTORS" means the Parent Guarantor and the Subsidiary
Guarantors.
"HAZARDOUS MATERIALS" means (a) petroleum or petroleum
products, by-products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon gas and (b)
any other chemicals, materials or substances designated, classified or regulated
as hazardous or toxic or as a pollutant or contaminant under any Environmental
Law.
11
"HEDGE AGREEMENTS" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap agreements,
currency future or option contracts and other hedging agreements.
"HOTEL ACCOUNT" has the meaning specified in Section 2.15.
"HOTEL ACCOUNT BANK" has the meaning specified in Section
2.15.
"INDEMNIFIED COSTS" has the meaning specified in Section
7.05(a).
"INDEMNIFIED PARTY" has the meaning specified in Section
8.04(b).
"INDENTURE" means the Indenture dated as of April 21, 1999
among the Parent Guarantor, the guarantors thereunder and The Bank of New York,
as Trustee, as amended by the Supplemental Indentures.
"INITIAL ISSUING BANK" has the meaning specified in the
Preamble to this Agreement.
"INITIAL LENDERS" has the meaning specified in the Preamble to
this Agreement.
"INSOLVENCY PROCEEDING" means, with respect to any Person, any
bankruptcy, insolvency, reorganization, assignment for the benefit of creditors,
receivership, moratorium or similar action, proceeding or arrangement with
respect to such Person under any applicable bankruptcy, insolvency or similar
law or regulation.
"INSUFFICIENCY" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section 4001(a)(18)
of ERISA.
"INTANGIBLE TAX RESERVE" has the meaning set forth in Section
4.01(o).
"INTEREST EXPENSE" means, with respect to any Person, for any
Rolling Period and as of any date of determination, without duplication, the sum
of (a) interest expense, whether paid or accrued, to the extent such expense was
deducted in computing net income (including amortization or original issue
discount, non-cash interest payments, the interest component of Capital Leases,
but excluding amortization of deferred financing fees), and (b) interest for
which such Person is liable pursuant to any Debt, including any Subsidiary of
such Person, in each case calculated for such Person.
"INTEREST PERIOD" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period commencing on the date of such
Eurodollar Rate Advance or the date of the Conversion of any Base Rate Advance
into such Eurodollar Rate Advance, and ending on the last day of the period
selected by the Borrower pursuant to the provisions below and, thereafter, each
subsequent period commencing on the last day of the immediately preceding
Interest Period and ending on the last day of the period selected by the
Borrower pursuant to the provisions below. Subject to Sections 2.08 and 2.09
hereof, the duration of each such Interest Period shall be one, two, three or
six months, as the Borrower may, upon notice received by the Administrative
Agent not later than 11:00 A.M. (New York City time) on the third Business Day
prior to the first day of such Interest Period, select; PROVIDED, HOWEVER, that:
(a) the Borrower may not select any Interest Period with
respect to any Eurodollar Rate Advance under the Facility that ends
after the Termination Date;
12
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Borrowing shall be
of the same duration;
(c) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next succeeding
Business Day, PROVIDED, HOWEVER, that, if such extension would cause
the last day of such Interest Period to occur in the next following
calendar month, the last day of such Interest Period shall occur on the
immediately preceding Business Day; and
(d) whenever the first day of any Interest Period occurs on a
day of an initial calendar month for which there is no numerically
corresponding day in the calendar month that succeeds such initial
calendar month by the number of months equal to the number of months in
such Interest Period, such Interest Period shall end on the last
Business Day of such succeeding calendar month.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of
1986, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"INVESTMENT" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any Equity Interests or Debt or the
assets comprising a division or business unit or a substantial part or all of
the business of such Person, any capital contribution to such Person or any
other direct or indirect investment in such Person, including, without
limitation, any acquisition by way of a merger or consolidation and any
arrangement pursuant to which the investor incurs Debt of the types referred to
in clause (i) or (j) of the definition of "Debt" in respect of such Person.
"ISSUING BANK" means the Initial Issuing Bank and any other
Lender approved as an Issuing Bank by the Administrative Agent and any Eligible
Assignee to which a Letter of Credit Commitment hereunder has been assigned
pursuant to Section 8.07 so long as each Lender or Eligible Assignee expressly
agrees to perform in accordance with their terms all of the obligations that by
the terms of this Agreement are required to be performed by it as an Issuing
Bank and notifies the Administrative Agent of its Applicable Lending Office and
the amount of its Letter of Credit Commitment (which information shall be
recorded by the Administrative Agent in the Register), for so long as such
Initial Issuing Bank, Lender or Eligible Assignee, as the case may be, shall
have a Letter of Credit Commitment.
"L/C ACCOUNT COLLATERAL" has the meaning specified in Section
9.01(a).
"L/C CASH COLLATERAL ACCOUNT" means an account of the Borrower
maintained with the Administrative Agent, at its office in New York, New York,
in the name of the Administrative Agent (for the ratable benefit of the Secured
Parties) and under the sole control and dominion of the Administrative Agent and
subject to the terms of this Agreement.
"L/C RELATED DOCUMENTS" has the meaning specified in Section
2.03(b)(ii).
"LEAD ARRANGER" has the meaning specified in the Preamble to
this Agreement.
"LENDER PARTY" means any Lender or the Issuing Bank.
"LENDERS" means the Initial Lenders and each Person that shall
become a Lender hereunder pursuant to Section 8.07 for so long as such Initial
Lender or Person shall be a party to this Agreement.
13
"LETTER OF CREDIT ADVANCE" means an advance made by the
Issuing Bank or any Lender pursuant to Section 2.02(A)(c).
"LETTER OF CREDIT AGREEMENT" has the meaning specified in
Section 2.02(A)(a).
"LETTER OF CREDIT COMMITMENT" means, with respect to any
Issuing Bank at any time, the amount set forth opposite such Issuing Bank's name
on SCHEDULE I hereto under the caption "Letter of Credit Commitment" or, if such
Issuing Bank has entered into one or more Assignment and Acceptances, set forth
for such Issuing Bank in the Register maintained by the Administrative Agent
pursuant to Section 8.07(d) as such Issuing Bank's "Letter of Credit
Commitment", as such amount may be reduced or terminated at or prior to such
time pursuant to Section 2.04 or 6.01, respectively.
"LETTER OF CREDIT FACILITY" means, at any time, an amount
equal to the lesser of (a) the aggregate amount of the Issuing Bank's Letter of
Credit Commitment at such time and (b) $15,000,000, as such amount may be
reduced at or prior to such time pursuant to Section 2.04.
"LETTERS OF CREDIT" has the meaning specified in Section
2.01(b).
"LETTER OF CREDIT REQUEST" has the meaning specified in
Section 2.02(A)(a).
"LEVERAGE RATIO" means, with respect to the Parent Guarantor,
as of any date of determination, the ratio of (a) Total Funded Debt at such date
to (b) Adjusted EBITDA for the Rolling Period ending on or immediately prior to
such date.
"LIEN" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance on, or
defect in, title to real property.
"LOAN DOCUMENTS" means (i) this Agreement, (ii) the Notes,
(iii) the Collateral Documents, (iv) the Guaranties, (v) each Letter of Credit
Agreement, (vi) the Fee Letter, and (vii) any other agreement, document or
instrument issued by the Borrower or any Guarantor evidencing, securing or
guarantying the foregoing or the Facility (or any portion thereof), and in each
case as amended, amended and restated, supplemented or otherwise modified from
time to time.
"LOAN PARTIES" means the Borrower and the Guarantors.
"LOCKBOX" shall have the meaning specified in Section 2.15.
"LOCKBOX ACCOUNT" shall have the meaning specified in Section
2.15.
"MANAGEMENT CONTRACTS" means the Hotel Management Agreement
dated March 4, 1997 between ▇▇▇▇ Bahia Mar, Ltd., as Owner, and ▇▇▇▇ Bahia Mar
Mgmt. Inc., as Manager, the Hotel Management Agreement dated as of March 4, 1997
between ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇., Ltd., as Owner, and Rahn Pier Mgt., Inc., as Manager,
as applicable and each of the Hotel Management Agreements with respect to the
Edgewater and the Registry in form and substance acceptable to the
Administrative Agent.
"MANAGERS" means ▇▇▇▇ Bahia Mar Mgmt., Inc. and Rahn Pier
Mgt., Inc, as applicable.
"MARGIN STOCK" has the meaning specified in Regulation U.
14
"MATERIAL ADVERSE CHANGE" means any material adverse change in
the business, condition (financial or otherwise), operations, performance,
properties or prospects of the Parent Guarantor and its Subsidiaries taken as a
whole or any of the Operating Subsidiaries.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(a) the business, condition (financial or otherwise), operations, performance,
properties or prospects of the Parent Guarantor and its Subsidiaries taken as a
whole or of any of the Operating Subsidiaries, (b) the rights and remedies of
any Secured Party under any Transaction Document or (c) the ability of the
Parent Guarantor and its Subsidiaries taken as a whole or of any of the
Operating Subsidiaries to perform their Obligations under any Transaction
Document to which they are or are to become parties; PROVIDED, HOWEVER, for the
purposes of Sections 4.01(p), 5.03(a) and 5.04(a), Material Adverse Effect shall
not include any matters and events demonstrated in or incorporated into the
financial statements of the Borrower and its Subsidiaries for the period July 1,
2002 through March 31, 2003 or the interim financial statement of the Borrower
and its Subsidiaries for the period April 1, 2003 through April 30, 2003
previously delivered to Administrative Agent.
"MATERIAL AGREEMENT" means any contract, lease, loan
agreement, indenture, mortgage, deed of trust, security agreement or other
agreement, instrument, obligation or arrangement to which any of the Loan
Parties is a party or by which any of their respective properties is bound
(other than the Loan Documents) for which breach, nonperformance, cancellation
or failure to renew could reasonably be expected to have a Material Adverse
Effect.
"MORTGAGEE TITLE INSURANCE POLICIES" has the meaning specified
in Section 3.01(a)(v)(A).
"MORTGAGE MODIFICATIONS" has the meaning specified in Section
3.01(a)(v).
"MORTGAGES" has the meaning specified in Section 3.01(a)(v).
"MORTGAGORS" has the meaning specified in the Security
Agreements.
"MULTIEMPLOYER PLAN" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make contributions.
"MULTIPLE EMPLOYER PLAN" means a multiple employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of
any Loan Party or any ERISA Affiliate and at least one Person other than the
Loan Parties and the ERISA Affiliates or (b) was so maintained and in respect of
which any Loan Party or any ERISA Affiliate could have liability under Section
4064 or 4069 of ERISA in the event such plan has been or were to be terminated.
"NOTE" or "NOTES" means the amended and restated promissory
notes of the Borrower in favor of each of the Lenders, which (i) amend and
restate the "Notes" issued by the Borrower pursuant to the Existing Agreement,
and (ii) evidence the Advances made pursuant to ARTICLE II, individually or
collectively, as appropriate, as such promissory notes may be amended, modified,
restated, supplemented, extended, renewed or replaced from time to time.
"NOTE PURCHASE AGREEMENT" means the Note Agreement dated as of
April 21, 1999 among the Parent Guarantor and the guarantors and initial
purchasers thereunder, pursuant to which the
15
Subordinated Notes are issued, as amended, amended and restated, supplemented or
otherwise modified from time in accordance with its terms, to the extent
permitted under the Loan Documents.
"NOTICE OF BORROWING" has the meaning specified in Section
2.02(a).
"NPL" means the National Priorities List under CERCLA.
"OBLIGATION" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including, without
limitation, any liability of such Person on any claim, whether or not the right
of any creditor to payment in respect of such claim is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, disputed, undisputed,
legal, equitable, secured or unsecured, and whether or not such claim is
discharged, stayed or otherwise affected by any proceeding referred to in
Section 6.01(f). Without limiting the generality of the foregoing, the
Obligations of any Loan Party under the Loan Documents include (a) the
obligation to pay principal, interest, charges, expenses, fees, commissions,
including, without limitation, Letter of Credit commissions, attorneys' fees and
disbursements, indemnities and other amounts payable by such Loan Party under
any Loan Document and (b) the obligation of such Loan Party to reimburse any
amount in respect of any of the foregoing that any Lender Party, in its sole
discretion, may elect to pay or advance on behalf of such Loan Party.
"OECD" means the Organization for Economic Cooperation and
Development.
"OPEN YEAR" has the meaning specified in Section 4.01(o)(ii).
"OPERATING SUBSIDIARIES" means each of the Subsidiaries of the
Borrower that directly owns one or more of the Borrowing Base Properties, as
listed on SCHEDULE 4.01(B) hereto.
"OTHER TAXES" has the meaning specified in Section 2.11(b).
"PARENT GUARANTOR" has the meaning specified in the
Preliminary Statements to this Agreement.
"PARENT GUARANTOR SECURITY AGREEMENT" has the meaning
specified in Section 3.01(a)(iii).
"PARENT GUARANTOR SECURITY AGREEMENT MODIFICATION" has the
meaning specified in Section 3.01(a)(iii).
"PARENT GUARANTY" means a guaranty in substantially the form
of EXHIBIT F-1, as amended, amended and restated, supplemented or otherwise
modified from time to time in accordance with its terms.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PERMITTED ENCUMBRANCES" means the specific title exceptions
described in the Mortgagee Title Policies (but not including any form
exclusions, conditions or stipulations set forth in the policies).
"PERMITTED LIENS" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall have
been commenced: (a) Liens for taxes, assessments and governmental charges or
levies to the extent not required to be paid under Section 5.01(b) hereof (as to
which adequate reserves have been established in accordance with GAAP), (b) the
Permitted
16
Encumbrances and (c) statutory mechanics' and materialmen's claims pertaining to
the construction on or improvements to the Borrowing Base Properties to the
extent that (i) such improvements are permitted under the Loan Documents and
(ii) the existence of such mechanics' and materialmen's liens is permitted
pursuant to the Mortgages.
"PERSON" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"PIER 66" means the resort, hotel and marina and related
improvements, facilities and assets, including, without limitation, the
Mortgaged Property (as defined in the Pier 66 Mortgage), situated on that
certain real property located in Broward County, Florida, and commonly known as
the Hyatt Regency Pier 66 Resort & Marina.
"PLAN" means a Single Employer Plan or a Multiple Employer
Plan.
"PLEDGED SHARES" means all Pledged Shares and all other equity
interests pledged to the Administrative Agent for the benefit of the Lenders
pursuant to the Security Agreements.
"PREFERRED INTERESTS" means, with respect to any Person,
Equity Interests issued by such Person that are entitled to a preference or
priority over any other Equity Interests issued by such Person upon any
distribution of such Person's property and assets, whether by dividend or upon
liquidation.
"PRO RATA SHARE" of any amount means, with respect to any
Lender at any time, the product of such amount TIMES a fraction the numerator of
which is the amount of such Lender's Revolving Credit Commitment at such time
(or, if the Commitments shall have been terminated, such Lender's Revolving
Credit Commitment as in effect immediately prior to such termination) and the
denominator of which is the Facility at such time (or, if the Commitments shall
have been terminated, the Facility as in effect immediately prior to such
termination); PROVIDED, HOWEVER, that with respect to any payments to be
allocated among the Lenders, during any period that a Lender is a Defaulting
Lender, the Pro Rata Shares of the Lenders shall be reallocated by deducting
from such Defaulting Lender's Commitment (and the Facility) an amount equal to
the Default Amount. The initial Pro Rata Share of each Lender is set forth
opposite the name of that Lender in SCHEDULE I annexed hereto; PROVIDED that
SCHEDULE I shall be amended and each Pro Rata Share shall be adjusted from time
to time to give effect to the execution of any supplements, amendments or
modifications to this Agreement and the addition or removal of any Lender as
provided herein or by assignment pursuant to Section 8.07.
"REDEEMABLE" means, with respect to any Equity Interest, any
Debt or any other right or Obligation, any such Equity Interest, Debt, right or
Obligation that (a) the issuer has undertaken to redeem at a fixed or
determinable date or dates, whether by operation of a sinking fund or otherwise,
or upon the occurrence of a condition not solely within the control of the
issuer or (b) is redeemable at the option of the holder.
"REGISTER" has the meaning specified in Section 8.07(d).
"REGISTRY" means the resort, hotel and private club and
related improvements, facilities and assets, including, without limitation, the
Mortgaged Property (as defined in the Registry Mortgage), situated on that
certain real property located in ▇▇▇▇▇▇▇ County, Florida, as more fully
described in the Registry Mortgage, and commonly known as the Registry Hotel.
17
"REGULATION U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"RELATED DOCUMENTS" means the Management Contracts and the
Franchise Agreements.
"REQUIRED LENDERS" means, at any time, Lenders holding at
least 51% of the Revolving Credit Commitments at such time; PROVIDED, HOWEVER,
that, if any Lender shall be a Defaulting Lender at such time, there shall be
excluded from the determination of Required Lenders at such time (a) the
aggregate principal amount of the Advances owing to such Lender (in its capacity
as a Lender) and outstanding at such time, (b) such Lender's Pro Rata Share of
the aggregate Available Amount of all Letters of Credit outstanding at such time
and (c) the aggregate unused Revolving Credit Commitments of such Lender at such
time. For purposes of this definition, the aggregate principal amount of Letter
of Credit Advances owing to the Issuing Bank and the Available Amount of each
Letter of Credit shall be considered to be owed to the Lenders ratably in
accordance with their respective Revolving Credit Commitments at such time.
"RESERVE ADJUSTED EBITDA" means, with respect to any Person
for any Rolling Period and at any date of determination, an amount equal to
Adjusted EBITDA LESS (a) a minimum FF&E reserve of 4% (however, not to exceed 4%
in the event actual reserves for FF&E are greater) of Total Revenues and (b)
management fees of 3% of Total Revenues including any management fees actually
paid that are deducted from Adjusted EBITDA.
"RESPONSIBLE OFFICER" means any executive officer of the
Parent Guarantor.
"REVOLVING CREDIT ADVANCE" has the meaning specified in
Section 2.01(a).
"REVOLVING CREDIT COMMITMENT" means, with respect to any
Lender at any time, the amount set forth opposite such Lender's name on SCHEDULE
I hereto under the caption "Revolving Credit Commitment" or, if such Lender has
entered into one or more Assignment and Acceptances, set forth for such Lender
in the Register maintained by the Administrative Agent pursuant to Section
8.07(d) as such Lender's "Revolving Credit Commitment", as such amount may be
reduced or terminated at or prior to such time pursuant to Section 2.04 or 6.01,
respectively.
"REVOLVING CREDIT FACILITY" means, at any time, the aggregate
amount of the Lenders' Revolving Credit Commitments at such time.
"ROLLING PERIOD" means, at any date of determination, the most
recently completed consecutive 12 calendar month period ending on or immediately
prior to such date.
"▇▇▇▇▇▇▇▇-▇▇▇▇▇" means the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, as
amended.
"SCOTIABANK" has the meaning set forth in the Preamble to this
Agreement.
"SECURED OBLIGATIONS" has the meaning specified in the
Security Agreements.
"SECURED PARTIES" means, collectively, the Administrative
Agent, the Lead Arranger, the Syndication Agent, the Documentation Agent and
each Lender Party.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
18
"SECURITY AGREEMENTS" means the Parent Guarantor Security
Agreement and the Subsidiary Guarantor Security Agreement.
"SINGLE EMPLOYER PLAN" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of
any Loan Party or any ERISA Affiliate and no Person other than the Loan Parties
and the ERISA Affiliates or (b) was so maintained and in respect of which any
Loan Party or any ERISA Affiliate could have liability under Section 4069 of
ERISA in the event such plan has been or were to be terminated.
"SINGLE PURPOSE ENTITY" means a Person, other than an
individual, which (i) is formed or organized solely for the purpose of holding,
directly or indirectly, an ownership interest in the Borrowing Base Properties
and the Managers thereof or Equity Interests in Persons holding, directly or
indirectly, an ownership interest in the Borrowing Base Properties and the
Managers thereof, (ii) does not engage in any business unrelated to the
Borrowing Base Properties or such Equity Interests, the operation and management
of the Borrowing Base Properties, and the financing thereof pursuant to the Loan
Documents, (iii) has not and will not have any assets other than those related
to its interest in the Borrowing Base Properties and the Managers thereof or
such Equity Interests or such financing thereof, and has not or will not have
any Debt other than, as applicable, the Debt permitted pursuant to Section
5.02(b), (iv) maintains its own separate books and records and its own accounts,
in each case which are separate and apart from the books and records and
accounts of any other Person, (v) holds itself out as being a Person, separate
and apart from any other Person, (vi) does not and will not commingle its funds
or assets with those of any other Person, (vii) conducts its own business in its
own name; (viii) maintains financial statements in accordance with the terms of
this Agreement, (ix) pays its own debts and liabilities when they become due out
of its own funds, (x) observes all partnership formalities or corporate
formalities or limited liability company formalities, as applicable, and does
all things necessary to preserve its existence, (xi) maintains an arm's-length
relationship with its Affiliates and shall not enter into any contractual
obligations with any Affiliates except upon terms and conditions that are
intrinsically fair and substantially similar to those that would be available on
an arm's-length basis with third parties other than an Affiliate, (xii) does not
guarantee or otherwise obligate itself with respect to the Debts of any other
Person, hold out its credit as being available to satisfy the obligations of any
other Person (except in connection with the Debt permitted pursuant to Section
5.02(b) hereof), (xiii) does not acquire obligations or securities of its
partners, members or shareholders, (xiv) allocates fairly and reasonably shared
expenses, including, without limitation, any overhead for shared office space,
(xv) does not and will not pledge its assets for the benefit of any other
Person, (xvi) does and will correct any known misunderstanding regarding its
separate identity and (xvii) maintains adequate capital in light of its
contemplated business operations.
"SOLVENT" and "SOLVENCY", with respect to any Person on a
particular date, has the meaning ascribed to such term in the Federal Bankruptcy
Code and any applicable state fraudulent conveyance laws, and shall include,
without limitation, the following, that on such date (a) the fair value of the
property of such Person is greater than the total amount of liabilities,
including, without limitation, contingent liabilities, of such Person, (b) the
present fair salable value of the assets of such Person is not less than the
amount that will be required to pay the probable liability of such Person on its
Debts as they become absolute and matured, (c) such Person does not intend to,
and does not believe that it will, incur Debts or liabilities beyond such
Person's ability to pay such Debts and liabilities as they mature and (d) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's property would constitute
an unreasonably small capital. The amount of contingent liabilities at any time
shall be computed as the amount that, in the light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.
19
"SUBORDINATED GUARANTY" means the guaranties by the Borrower
and its Subsidiaries of the Obligations of the Parent Guarantor under the
Subordinated Notes pursuant to the Indenture.
"SUBORDINATED NOTES" means the Senior Subordinated Notes of
the Parent Guarantor due 2009 in an aggregate principal amount of $340,000,000
issued pursuant to an Indenture dated as of April 21, 1999, as amended by the
Supplemental Indentures.
"SUBSIDIARY" of any Person means any corporation, partnership,
joint venture, limited liability company, trust or estate of which (or in which)
more than 50% of (a) the issued and outstanding capital stock having ordinary
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such limited
liability company, partnership or joint venture or (c) the beneficial interest
in such trust or estate, is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
"SUBSIDIARY GUARANTORS" means all Subsidiaries of the
Borrower, including the Operating Subsidiaries, listed on SCHEDULE 4.01(B)
hereto and each other Subsidiary that shall be required to execute and deliver a
guaranty pursuant to Section 5.01(j).
"SUBSIDIARY GUARANTOR SECURITY AGREEMENT" has the meaning
specified in Section 3.01(a)(iii).
"SUBSIDIARY GUARANTOR SECURITY AGREEMENT CONSENT" has the
meaning specified in Section 3.01(a)(iii).
"SUBSIDIARY GUARANTY" has the meaning specified in Section
3.01(a)(iv).
"SURVIVING DEBT" means Debt of the Parent Guarantor, the
Borrower and its Subsidiaries outstanding immediately before and after the
Transaction.
"SUPPLEMENTAL INDENTURES" means, collectively, that certain
Supplemental Indenture dated as of August 31, 1999, by and among Florida
Panthers Holdings, Inc., Causeway Bridge Property, Inc. and The Bank of New
York, that certain Supplemental Indenture dated as of August 31, 1999, by and
among Florida Panthers Holdings, Inc., East Bridge Mall, Inc. and The Bank of
New York, that certain Supplemental Indenture dated as of August 31, 1999, by
and among Florida Panthers Holdings, Inc., Biltmore Resort Management, Inc. and
The Bank of New York, that certain Supplemental Indenture by and among Florida
Panthers Holdings, Inc., Boca Resort Group Management, Inc. and The Bank of New
York, that certain Supplemental Indenture dated as of September 21, 1999, by and
among Florida Panthers Holdings, Inc., and The Bank of New York, that certain
Supplemental Indenture by and among Florida Panthers Holdings, Inc., Boca
Resorts, Inc., and The Bank of New York, that certain Supplemental Indenture
dated as of September 30, 1999, by and among Boca Resorts, Inc., ▇▇▇▇ Bahia, LLC
and The Bank of New York, that certain Supplemental Indenture dated as of
September 30, 1999, by and among Boca Resorts, Inc., Pelican Hill, LLC and The
Bank of New York, that certain Supplemental Indenture dated as of September 30,
1999, by and among Boca Resorts, Inc., P66, LLC and The Bank of New York, that
certain Supplemental Indenture dated as of November 15, 1999, by and among Boca
Resorts, Inc., BRI Edgewater Management, Inc. and The Bank of New York, that
certain Supplemental Indenture dated as of January 13, 2000, by and among Boca
Resorts, Inc., South Florida Hospitality Provisions, Inc. and The Bank of New
York and that certain Supplemental Indenture dated as of July 12, 2001, by and
among Boca Resorts, Inc., Incredible Ice, LLC and The Bank of New York.
20
"SYNDICATION AGENT" has the meaning specified in the Preamble
to this Agreement.
"TAX CERTIFICATE" has the meaning specified in Section 5.03(j)
"TAXES" has the meaning specified in Section 2.11(a).
"TERMINATION DATE" means the earlier of (x) June 30, 2005 and
(y) the date of termination in whole of the Commitments pursuant to Section 2.04
or 6.01 (the "COMMITMENT TERMINATION DATE").
"TOTAL FUNDED DEBT" shall include all Debt of the Parent
Guarantor and its Subsidiaries, on a Consolidated basis, excluding (i) all
liabilities associated with the Premier Club memberships at the Boca Raton
Resort and Club and at other resort properties owned, whether directly or
indirectly, by the Parent Guarantor, in each case determined pursuant to the
membership program in effect on March 31, 1999 or any future membership program
which only permits a membership refund from fees paid for new memberships sold
subsequent to the date of the refund request.
"TOTAL REVENUES" means, for any Rolling Period, on a
Consolidated basis for the Borrowing Base Properties, the total revenues of such
Properties determined in accordance with GAAP.
"TRANSACTION" means the transactions contemplated by the
Transaction Documents.
"TRANSACTION DOCUMENTS" means, collectively, the Loan
Documents and the Related Documents.
"TYPE" refers to the distinction between Advances bearing
interest at the Base Rate and Advances bearing interest at the Eurodollar Rate.
"UCC" has the meaning specified in the Security Agreements.
"UNUSED COMMITMENT" means, with respect to any Lender at any
time, (a) such Lender's Revolving Credit Commitment at such time MINUS (b) the
sum of (i) the aggregate principal amount of all Revolving Credit Advances and
Letter of Credit Advances made by such Lender (in its capacity as a Lender) and
outstanding at such time PLUS (ii) such Lender's Pro Rata Share of (A) the
aggregate Available Amount of all Letters of Credit outstanding at such time and
(B) the aggregate principal amount of all Letter of Credit Advances made by the
Issuing Bank pursuant to Section 2.02(A)(c) and outstanding at such time.
"VARIABLE RATE DEBT" has the meaning specified in Section
5.01(r).
"VOTING INTERESTS" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person, the holders of
which are ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such Person,
even if the right so to vote has been suspended by the happening of such a
contingency.
"WELFARE PLAN" means a welfare plan, as defined in Section
3(1) of ERISA, that is maintained for employees of any Loan Party or in respect
of which any Loan Party could have a liability.
"WITHDRAWAL LIABILITY" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
21
SECTION 1.02. COMPUTATION OF TIME PERIODS; OTHER DEFINITIONAL
PROVISIONS. In this Agreement and the other Loan Documents, in the computation
of periods of time from a specified date to a later specified date, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding". References in the Loan Documents to any agreement or contract
"as amended" shall mean and be a reference to such agreement or contract as
amended, amended and restated, supplemented or otherwise modified from time to
time in accordance with its terms. The term "including" is not limiting and
means "including without limitation."
SECTION 1.03. ACCOUNTING TERMS. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the preparation
of the financial statements referred to in Section 4.01(f) ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. THE ADVANCES AND THE LETTERS OF CREDIT. (a) THE
REVOLVING CREDIT ADVANCES. Each Lender severally agrees, on the terms and
conditions hereinafter set forth, including the satisfaction of the conditions
precedent set forth in Section 3.02, to make advances (each, a "REVOLVING CREDIT
ADVANCE") to the Borrower from time to time on any Business Day during the
period from the date hereof until 90 days prior to the Termination Date in an
amount for each such Advance not to exceed such Lender's Unused Commitment
hereunder at such time and shall not exceed for all Lenders at any time
outstanding the lesser of the Facility and the Borrowing Base Amount at such
time. Each Borrowing shall be in an aggregate amount of $5,000,000 or an
integral multiple of $250,000 in excess thereof (other than a Borrowing the
proceeds of which shall be used solely to repay or prepay in full outstanding
Letter of Credit Advances) and shall consist of Advances made simultaneously by
the Lenders in proportion to their respective Pro Rata Shares. Within the limits
of the aggregate amount of all Unused Commitments in effect hereunder from time
to time, and subject to the restrictions set forth elsewhere in this Agreement,
the Borrower may borrow under this Section 2.01, prepay pursuant to Section
2.05(a) and reborrow under this Section 2.01.
(b) THE LETTERS OF CREDIT. The Issuing Bank agrees, on the
terms and conditions hereinafter set forth, to issue (or cause its Affiliate
that is commercial bank to issue) standby letters of credit (the "LETTERS OF
CREDIT") for the account of the Borrower from time to time on any Business Day
during the period from the Closing Date until 60 days before the Termination
Date in an aggregate Available Amount (i) for all Letters of Credit issued by
the Issuing Bank not to exceed at any time the Letter of Credit Facility at such
time and (ii) for each such Letter of Credit not to exceed an amount equal to
the Unused Commitments of the Lenders at such time. Letters of Credit shall be
denominated in United States Dollars and shall permit drawings payable on a
sight basis. No Letter of Credit shall have an expiration date later than the
earlier of one year after the date of issuance thereof and the 30th day before
the Termination Date; PROVIDED, HOWEVER, that the expiration date of any Letter
of Credit may be automatically extended for periods of up to one year but not
later than the 30th day before the Termination Date. Within the limits of the
Letter of Credit Facility, the Borrower may request the issuance of Letters of
Credit under this Section 2.01(b) in amounts no less than $250,000 for each such
Letter of Credit, repay any Letter of Credit Advances resulting from drawings
under Letters of Credit pursuant to Section 2.02(A)(c), and request the issuance
of additional Letters of Credit under this Section 2.01(b), subject to the
foregoing limitations.
SECTION 2.02. MAKING THE ADVANCES. (a) Each Borrowing shall be
made on notice, given not later than 11:00 A.M. (New York City time) on the
third Business Day prior to the date of the proposed Borrowing by the Borrower
to the Administrative Agent, which shall give to each Lender prompt notice
thereof by telex or telecopier. Each such notice of a Borrowing (a "NOTICE OF
BORROWING")
22
shall be in writing, or telex or telecopier, in substantially the form of
EXHIBIT B-1 hereto, specifying therein the requested (i) date of such Borrowing,
(ii) Type of Advances comprising such Borrowing, (iii) aggregate amount of such
Borrowing and (iv) in the case of a Borrowing consisting of Eurodollar Rate
Advances, initial Interest Period for each such Advance. Each Lender shall,
before 11:00 A.M. (New York time) on the date of such Borrowing, make available
for the account of its Applicable Lending Office to the Administrative Agent at
the Administrative Agent's Account, in same day funds, such Lender's Pro Rata
Share of such Borrowing. After the Administrative Agent's receipt of such funds
and upon fulfillment of the applicable conditions set forth in Article III, the
Administrative Agent will make such funds available to the Borrower by crediting
the Borrower's Account; PROVIDED, HOWEVER, that, in the case of any Borrowing,
the Administrative Agent shall first make a portion of such funds equal to the
aggregate principal amount of any Letter of Credit Advances made by the Issuing
Bank, and by any other Lender and outstanding on the date of such Borrowing,
PLUS interest accrued and unpaid thereon to and as of such date, available to
the Issuing Bank, and such other Lenders for repayment of such Letter of Credit
Advances.
(b) Anything in subsection (a) above to the contrary
notwithstanding, (i) the Borrower may not select Eurodollar Rate Advances or for
any Borrowing if the aggregate amount of such Borrowing is less than $5,000,000
or if the obligation of the Lenders to make Eurodollar Rate Advances shall then
be suspended pursuant to Section 2.08 or 2.09 and (ii) no more than five
Eurodollar Rate Advances shall be outstanding at any time.
(c) Each Notice of Borrowing shall be irrevocable and binding
on the Borrower. The Borrower shall indemnify the Administrative Agent and each
Lender against any loss, cost or expense incurred by such Person as a result of
any failure to fulfill on or before the date specified in such Notice of
Borrowing for such Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss (including loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund the Advance to be made
by such Lender as part of such Borrowing when such Advance, as a result of such
failure, is not made on such date.
(d) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any Borrowing under the Facility under which
such Lender has a Commitment that such Lender will not make available to the
Administrative Agent such Lender's Pro Rata Share of such Borrowing, the
Administrative Agent may assume that such Lender has made such portion available
to the Administrative Agent on the date of such Borrowing in accordance with
subsection (a) of this Section 2.02 and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such Pro Rata Share available to the Administrative Agent, such Lender and
the Borrower severally agree to repay or pay to the Administrative Agent
forthwith on demand such corresponding amount and to pay interest thereon, for
each day from the date such amount is made available to the Borrower until the
date such amount is repaid or paid to the Administrative Agent, at (i) in the
case of the Borrower, the interest rate applicable at such time under Section
2.06 to Advances comprising such Borrowing and (ii) in the case of such Lender,
the Federal Funds Rate. If such Lender shall pay to the Administrative Agent
such corresponding amount, such amount so paid in respect of principal shall
constitute such Lender's Advance as part of such Borrowing for all purposes.
(e) The failure of any Lender to make the Advance to be made
by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.
23
SECTION 2.02(A). ISSUANCE OF AND DRAWINGS AND REIMBURSEMENT
UNDER LETTERS OF CREDIT. (a) REQUEST FOR ISSUANCE. Each Letter of Credit shall
be issued upon submission by the Borrower of a Letter of Credit Request in
substantially the form of EXHIBIT B-2 hereto given to the Issuing Bank (with a
copy to the Administrative Agent), not later than 11:00 A.M. (New York City
time) on the third Business Day (or such shorter period agreed to by the Issuing
Bank) prior to the proposed date of issuance of such Letter of Credit. Each such
request for the issuance of a Letter of Credit (a "LETTER OF CREDIT REQUEST")
may be delivered by facsimile transmission and the Issuing Bank and
Administrative Agent may act on any such facsimile notice without the need to
obtain the original of such notice. If so required by the Issuing Bank, each
Letter of Credit Request shall be accompanied by the Issuing Bank's standard
form of application and agreement for Letters of Credit (a "LETTER OF CREDIT
AGREEMENT"). If the requested Letter of Credit is acceptable to the Issuing Bank
in its reasonable discretion and provided that the Issuing Bank has received the
authorization of the Administrative Agent to such issuance, the Issuing Bank
will, upon the fulfillment of the applicable conditions set forth in Article
III, issue such Letter of Credit. In the event and to the extent that the
provisions of any Letter of Credit Agreement shall conflict with this Agreement,
the provisions of this Agreement will govern.
(b) LETTER OF CREDIT REPORTS. Promptly after the issuance or
amendment of any Letter of Credit the Issuing Bank shall notify the Borrower and
the Administrative Agent, in writing, of such issuance or amendment and such
notice shall be accompanied by a copy of such issuance or amendment. Upon
receipt of such notice, the Administrative Agent shall promptly notify each
Lender, in writing, of such issuance or amendment and if so requested by a
Lender, the Administrative Agent shall provide such Lender with copies of such
issuance or amendment. The Issuing Bank shall furnish to the Administrative
Agent (unless the Issuing Bank shall be the Administrative Agent) by facsimile
on the first Business Day of each month, a written report summarizing the
aggregate daily Available Amounts for Letters of Credit during the preceding
month.
(c) DRAWING AND REIMBURSEMENT. The payment by the Issuing Bank
of a draft drawn under any Letter of Credit shall constitute for all purposes of
this Agreement the making by the Issuing Bank of a Letter of Credit Advance,
which shall be a Base Rate Advance, in the amount of such draft. Upon written
demand by the Issuing Bank with an outstanding Letter of Credit Advance, with a
copy of such demand to the Administrative Agent, each Lender shall purchase from
the Issuing Bank, and the Issuing Bank shall sell and assign to each such
Lender, such Lender's Pro Rata Share of such outstanding Letter of Credit
Advance as of the date of such purchase, by making available for the account of
its Applicable Lending Office to the Administrative Agent for the account of the
Issuing Bank, by deposit to the Administrative Agent's Account, in same day
funds, an amount equal to the portion of the outstanding principal amount of
such Letter of Credit Advance to be purchased by such Lender. Promptly after
receipt thereof, the Administrative Agent shall transfer such funds to the
Issuing Bank. The Borrower hereby agrees to each such sale and assignment. Each
Lender agrees to purchase its Pro Rata Share of an outstanding Letter of Credit
Advance on (i) the Business Day on which demand therefor is made by the Issuing
Bank which made such Advance, PROVIDED that notice of such demand is given not
later than 11:00 A.M. (New York City time) on such Business Day, or (ii) the
first Business Day next succeeding such demand if notice of such demand is given
after such time. Upon any such assignment by the Issuing Bank to any Lender of a
portion of a Letter of Credit Advance, the Issuing Bank represents and warrants
to such other Lender that the Issuing Bank is the legal and beneficial owner of
such interest being assigned by it, free and clear of any liens, but makes no
other representation or warranty and assumes no responsibility (other than as
set forth in Section 7.05(d)) with respect to such Letter of Credit Advance, the
Loan Documents or any Loan Party. If and to the extent that any Lender shall not
have so made the amount of such Letter of Credit Advance available to the
Administrative Agent, such Lender agrees to pay to the Administrative Agent
forthwith on demand such amount together with interest thereon, for each day
from the date of demand by the Issuing Bank until the date such amount is paid
to the Administrative Agent, at the Federal Funds Rate for its account or the
account of the Issuing Bank, as
24
applicable. If such Lender shall pay to the Administrative Agent such amount for
the account of the Issuing Bank on any Business Day, such amount so paid in
respect of principal shall constitute a Letter of Credit Advance made by such
Lender on such Business Day for purposes of this Agreement, and the outstanding
principal amount of the Letter of Credit Advance made by the Issuing Bank shall
be reduced by such amount on such Business Day.
(d) FAILURE TO MAKE LETTER OF CREDIT ADVANCES. The failure of
any Lender to make the Letter of Credit Advance to be made by it on the date
specified in Section 2.02(A)(c) shall not relieve any other Lender of its
obligation hereunder to make its Letter of Credit Advance on such date, but no
Lender shall be responsible for the failure of any other Lender to make the
Letter of Credit Advance to be made by such other Lender on such date.
SECTION 2.03. Repayment of Advances. (a) REVOLVING CREDIT
ADVANCES. The Borrower shall repay to the Administrative Agent for the account
of the Lenders' Pro Rata Shares on the Termination Date the aggregate
outstanding principal amount of the Revolving Credit Advances then outstanding,
together with all accrued interest and any other sums outstanding under the Loan
Documents (which amounts shall be reduced as a result of the application of
prepayments in accordance with the provisions of Section 2.05).
(b) LETTER OF CREDIT ADVANCES. (i) The Borrower shall repay to
the Administrative Agent for the account of the Issuing Bank and each other
Lender that has made a Letter of Credit Advance on the earlier of demand and the
Termination Date the outstanding principal amount of each Letter of Credit
Advance made by each of them.
(ii) The Obligations of the Borrower under this Agreement, any
Letter of Credit Agreement and any other agreement or instrument relating to any
Letter of Credit shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement, such Letter of Credit
Agreement and such other agreement or instrument under all circumstances,
including, without limitation, the following circumstances:
(A) any lack of validity or enforceability of any Loan
Document, any Letter of Credit Agreement, any Letter of Credit or any
other agreement or instrument relating thereto (all of the foregoing
being, collectively, the "L/C RELATED DOCUMENTS");
(B) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations of the Borrower in
respect of any L/C Related Document or any other amendment or waiver of
or any consent to departure from all or any of the L/C Related
Documents;
(C) the existence of any claim, set-off, defense or other
right that the Borrower may have at any time against any beneficiary or
any transferee of a Letter of Credit (or any Persons for which any such
beneficiary or any such transferee may be acting), the Issuing Bank or
any other Person, whether in connection with the transactions
contemplated by the L/C Related Documents or any unrelated transaction;
(D) any statement or any other document presented under a
Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(E) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit;
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(F) any exchange, release or non-perfection of any Collateral
or other collateral, or any release or amendment or waiver of or
consent to departure from the Guaranties or any other guarantee, for
all or any of the Obligations of the Borrower in respect of the L/C
Related Documents; or
(G) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including, without limitation, any
other circumstance that might otherwise constitute a defense available
to, or a discharge of, the Borrower or a guarantor.
SECTION 2.04. TERMINATION OR REDUCTION OF THE COMMITMENTS. (a)
OPTIONAL. The Borrower may, upon at least five Business Days' notice to the
Administrative Agent, terminate in whole or reduce in part the aggregate amount
of all Unused Commitments; provided, however, that each partial reduction of the
Facility (i) shall be in an aggregate amount of $5,000,000 or an integral
multiple of $1,000,000 in excess thereof (other than with respect to the Letter
of Credit Facility) and (ii) shall be made to the Administrative Agent and
allocated to the Lenders in accordance with their respective Pro Rata Shares.
(b) MANDATORY. (i) The Facility shall, on the 30th day
following the date any Event of Default shall have occurred and be continuing,
automatically and permanently be reduced by the amount of any prepayment
required by Section 2.05(b)(ii).
(ii) The Letter of Credit Facility shall be permanently
reduced from time to time on the date of each reduction in the Revolving Credit
Facility by the amount, if any, by which the amount of the Letter of Credit
Facility exceeds the Revolving Credit Facility after giving effect to such
reduction of the Revolving Credit Facility.
SECTION 2.05. PREPAYMENTS. (a) OPTIONAL. The Borrower may,
upon at least three Business Day's prior written notice to the Administrative
Agent (received not later than 12:00 P.M. (New York City time)) stating the
proposed date, aggregate principal amount of the prepayment and the outstanding
Borrowings to which the Borrower proposes to apply such prepayment, and if such
notice is given the Borrower shall, prepay all or any portion of the outstanding
aggregate principal amount of the Advances to the Administrative Agent and
allocated to the Lenders in accordance with their respective Pro Rata Shares;
PROVIDED, HOWEVER, that each partial prepayment shall be in an aggregate
principal amount of $2,000,000 or an integral multiple of $250,000 in excess
thereof.
(b) MANDATORY. (i) If at any time the aggregate amount of the
Advances then outstanding shall exceed the lesser of the Facility and the
Borrowing Base Amount (as limited by the Intangible Tax Reserve), and the
Administrative Agent shall have so notified the Borrower, the Borrower shall
prepay an aggregate principal amount of the Advances and, to the extent there
are no further outstanding Revolving Credit Advances, deposit an amount in the
L/C Cash Collateral Account equal to the amount by which (A) the sum of the
aggregate principal amount of the Advances then outstanding PLUS the aggregate
Available Amount of all Letters of Credit then outstanding exceeds (B) the
lesser of the Facility and the Borrowing Base Amount (as limited by the
Intangible Tax Reserve).
(ii) The Borrower shall, on each Business Day, pay to the
Administrative Agent for deposit in the L/C Cash Collateral Account an amount
sufficient to cause the aggregate amount on deposit in the L/C Cash Collateral
Account to equal the amount by which the aggregate Available Amount of all
Letters of Credit then outstanding exceeds the Letter of Credit Facility on such
Business Day.
(iii) Prepayments of the Facility made pursuant to clause (i)
above shall be FIRST applied to prepay Letter of Credit Advances then
outstanding until such Advances are paid in full, SECOND
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applied to prepay Revolving Credit Advances then outstanding comprising part of
the same Borrowings until such Advances are paid in full and THIRD deposited in
the L/C Cash Collateral Account to cash collateralize up to 100% of the
Available Amount of the Letters of Credit then outstanding. Upon the drawing of
any Letter of Credit for which funds are on deposit in the L/C Cash Collateral
Account, such funds shall be applied to reimburse the Issuing Bank or Lenders,
as applicable.
(iv) So long as any Event of Default shall have occurred and
be continuing, all payments in respect of the Borrowing Base Properties and all
other income related thereto shall be swept daily into the Lockbox Account in
accordance with Section 2.15 hereof and applied in accordance with Section 2.15.
(c) ACCRUED INTEREST, ETC. All prepayments under this Section
2.05 shall be made together with (i) accrued interest to the date of such
prepayment on the principal amount prepaid, and (ii) if any prepayment of a
Eurodollar Rate Advance shall be made other than on the last day of an Interest
Period therefor, any amounts owing pursuant to Section 8.04(c).
SECTION 2.06. INTEREST. (a) SCHEDULED INTEREST. The Borrower
shall pay interest on the unpaid principal amount of each Advance owing to each
Lender from the date of such Advance until such principal amount shall be paid
in full, at the following rates per annum:
(i) BASE RATE ADVANCES. During such periods as such Advance is
a Base Rate Advance, a rate per annum equal at all times to the sum of
the Base Rate PLUS the Applicable Margin, payable in arrears monthly on
the first day of each month.
(ii) EURODOLLAR RATE ADVANCES. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at all
times during each Interest Period for such Advance to the sum of the
Eurodollar Rate for such Interest Period for such Advance PLUS the
Applicable Margin, payable in arrears on the last day of such Interest
Period and, if such Interest Period has a duration of more than three
months, on each day that occurs during such Interest Period every three
months from the first day of such Interest Period and on the date such
Eurodollar Rate Advance shall be Converted or paid in full.
(b) DEFAULT INTEREST. Upon the occurrence and during the
continuance of any Default the Administrative Agent may, and upon the request of
the Required Lenders shall, require that the Borrower pay interest on (i) the
unpaid principal amount of each Advance owing to each Lender, payable in arrears
on the dates referred to in clause (a)(i) or (a)(ii) above and, in addition, on
demand, at a rate per annum equal at all times to 2% per annum above the rate
per annum required to be paid on such Advance pursuant to clause (a)(i) or
(a)(ii) above and (ii) to the fullest extent permitted by law, the amount of any
interest, fee or other amount payable under the Loan Documents that is not paid
when due, from the date such amount shall be due until such amount shall be paid
in full, payable in arrears on the date such amount shall be paid in full and on
demand, at a rate per annum equal at all times to 2% per annum above the rate
per annum required to be paid, in the case of interest, on the Type of Advance
on which such interest has accrued pursuant to clause (a)(i) or (a)(ii) above
and, in all other cases, on Base Rate Advances pursuant to clause (a)(i) above;
PROVIDED, HOWEVER, that following acceleration of the Advances pursuant to
Section 6.01, interest shall accrue and be payable at the rate required by this
Section 2.06(b), whether or not requested by the Administrative Agent or the
Required Lenders.
SECTION 2.07. FEES. (a) UNUSED COMMITMENT FEE. The Borrower
shall pay to the Administrative Agent for the account of the Lenders an unused
commitment fee, from the date of this Agreement in the case of each Initial
Lender and from the effective date specified in the Assignment and Acceptance
pursuant to which it became a Lender in the case of each other Lender, in each
case until the
27
Termination Date, payable in arrears monthly on the first day of each month,
commencing July 1, 2003, and on the Termination Date, at the rate of .50% per
annum on the average daily Unused Commitment of such Lender or, if aggregate
Advances exceed 50% of the Revolving Credit Commitments, .40% per annum;
PROVIDED, HOWEVER, that any commitment fee accrued with respect to the Revolving
Credit Commitment of a Defaulting Lender during the period prior to the time
such Lender became a Defaulting Lender and unpaid at such time shall not be
payable by the Borrower so long as such Lender shall be a Defaulting Lender
except to the extent that such commitment fee shall otherwise have been due and
payable by the Borrower prior to such time; and PROVIDED FURTHER, HOWEVER, that
no commitment fee shall accrue on the Revolving Credit Commitments of a
Defaulting Lender so long as such Lender shall be a Defaulting Lender.
(b) FEES TO ADMINISTRATIVE AGENT. The Borrower shall pay to
the Administrative Agent for its own account such fees as may from time to time
be agreed between the Borrower and Administrative Agent.
(c) LETTER OF CREDIT FEES, ETC. (i) The Borrower shall pay to
the Administrative Agent for the account of each Lender having a Revolving
Credit Commitment a commission, payable quarterly in arrears on the last
Business Day of each March, June, September and December, commencing June 30,
2003, and ending on the Termination Date, on such Lender's Pro Rata Share of the
daily aggregate Available Amount during such quarter of all Letters of Credit
outstanding from time to time at the rate per annum equal to the Applicable
Margin for Eurodollar Rate Borrowings in effect from time to time.
(ii) The Borrower shall pay to the Issuing Bank, for its own
account, a fronting fee for each Letter of Credit issued by the Issuing Bank,
payable quarterly in arrears on the last Business Day of each March, June,
September and December, commencing June 30, 2003, and ending on the Termination
Date, on the daily aggregate Available Amount at the rate of 0.125% per annum.
In addition, the Borrower shall pay to the Issuing Bank, the Issuing Bank's
standard charges with respect to the issuance of, amendment to, payment under
and transfer of Letters of Credit and such other fees related to Letters of
Credit including but not limited to postage, courier, telex and legal expenses.
SECTION 2.08. CONVERSION OF ADVANCES. (a) OPTIONAL. The
Borrower may on any Business Day, upon notice given to the Administrative Agent
not later than 11:00 A.M. (New York City time) on the third Business Day prior
to the date of the proposed Conversion and subject to the provisions of Section
2.09, Convert all or any portion of the Advances of one Type comprising the same
Borrowing into Advances of the other Type; PROVIDED, HOWEVER, that if any
Conversion of Eurodollar Rate Advances into Base Rate Advances is made other
than on the last day of an Interest Period for such Eurodollar Rate Advances the
Borrower shall also pay any amounts owing pursuant to Section 8.04(c), (x) any
Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in an
amount not less than the minimum amount specified in Section 2.02(b), (y) no
Conversion of any Advances shall result in more separate Borrowings than
permitted under Section 2.02(b) and (z) each Conversion of Advances comprising
part of the same Borrowing under the Facility shall be made ratably among the
Lenders in accordance with their Pro Rata Share under the Facility. Each such
notice of Conversion shall, within the restrictions specified above, specify (i)
the date of such Conversion, (ii) the Advances to be Converted and (iii) if such
Conversion is into Eurodollar Rate Advances, the duration of the initial
Interest Period for such Advances. Each notice of Conversion shall be
irrevocable and binding on the Borrower.
(b) MANDATORY. (i) On the date on which the aggregate unpaid
principal amount of Eurodollar Rate Advances comprising any Borrowing shall be
reduced, by payment or prepayment or otherwise, to less than $5,000,000, such
Advances shall automatically Convert into Base Rate Advances.
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(ii) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and the Lenders,
whereupon each such Eurodollar Rate Advance will automatically, on the last day
of the then existing Interest Period therefor, Convert into a new Eurodollar
Rate Advance with an Interest Period of one month unless the Administrative
Agent has received notice from the Borrower not less that three days prior to
the last day of the then existing Interest Period.
(iii) Upon the occurrence and during the continuance of any
Event of Default and upon notice from the Administrative Agent to the Borrower,
(x) each Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor (or immediately at the option of the
Administrative Agent and subject to Section 8.04(c)), Convert into a Base Rate
Advance and (y) the obligation of the Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended.
SECTION 2.09. INCREASED COSTS, ETC. (a) If, due to either (i)
the introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law),
there shall be any increase in the cost to any Lender Party of agreeing to make
or of making, funding or maintaining Eurodollar Rate Advances or of agreeing to
issue or of issuing or maintaining or participating in Letters of Credit or of
agreeing to make or of making or maintaining Letter of Credit Advances
(excluding, for purposes of this Section 2.09, any such increased costs
resulting from (x) Taxes or Other Taxes (as to which Section 2.11 shall govern)
and (y) changes in the basis of taxation of overall net income or overall gross
income by the United States or by the foreign jurisdiction or state under the
laws of which such Lender Party is organized or has its Applicable Lending
Office or any political subdivision thereof), then the Borrower shall from time
to time, upon demand by such Lender Party (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender Party additional amounts sufficient to compensate such Lender Party for
such increased cost; provided, however, that a Lender Party claiming additional
amounts under this Section 2.09(a) agrees to use reasonable efforts (consistent
with its internal policy and legal and regulatory restrictions) to designate a
different Applicable Lending Office if the making of such a designation would
avoid the need for, or reduce the amount of, such increased cost that may
thereafter accrue and would not, in the reasonable judgment of such Lender
Party, be otherwise disadvantageous to such Lender Party. A certificate as to
the amount of such increased cost, submitted to the Borrower by such Lender
Party, shall be conclusive and binding for all purposes, absent manifest error.
(b) If any Lender Party determines that compliance with any
law or regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or would
affect the amount of capital required or expected to be maintained by such
Lender Party or any corporation controlling such Lender Party and that the
amount of such capital is increased by or based upon the existence of such
Lender Party's commitment to lend or to issue or participate in Letters of
Credit hereunder and other commitments of such type or the issuance or
maintenance of or participation in the Letters of Credit (or similar contingent
obligations), then, upon demand by such Lender Party (with a copy of such demand
to the Administrative Agent), the Borrower shall pay to the Administrative Agent
for the account of such Lender Party, from time to time as specified by such
Lender Party, additional amounts sufficient to compensate such Lender Party in
the light of such circumstances, to the extent that such Lender Party reasonably
determines such increase in capital to be allocable to the existence of such
Lender Party's commitment to lend or to issue or participate in Letters of
Credit hereunder or to the issuance or maintenance of or participation in any
Letters of Credit. A certificate as to such amounts submitted to the Borrower by
such Lender Party shall be conclusive and binding for all purposes, absent
manifest error.
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(c) If, with respect to any Eurodollar Rate Advances under the
Facility, Lenders owed at least 50% of the then aggregate unpaid principal
amount thereof notify the Administrative Agent that the Eurodollar Rate for any
Interest Period for such Advances will not adequately reflect the cost to such
Lenders of making, funding or maintaining their Eurodollar Rate Advances for
such Interest Period, the Administrative Agent shall forthwith so notify the
Borrower and the Lenders, whereupon (i) each such Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance and (ii) the obligation of the Lenders to make,
or to Convert Advances into, Eurodollar Rate Advances shall be suspended until
the Administrative Agent shall notify the Borrower that such Lenders have
determined that the circumstances causing such suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if
the introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmental
authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to the Borrower
through the Administrative Agent, (i) each Eurodollar Rate Advance will
automatically, upon such demand, Convert into a Base Rate Advance and (ii) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended until the Administrative Agent shall notify the
Borrower that such Lender has determined that the circumstances causing such
suspension no longer exist; PROVIDED, HOWEVER, that, before making any such
demand, such Lender agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different
Eurodollar Lending Office if the making of such a designation would allow such
Lender or its Eurodollar Lending Office to continue to perform its obligations
to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar
Rate Advances and would not, in the judgment of such Lender, be otherwise
disadvantageous to such Lender.
SECTION 2.10. PAYMENTS AND COMPUTATIONS. (a) The Borrower
shall make each payment hereunder and under the Notes, irrespective of any right
of counterclaim or set-off, not later than 12:00 P.M. (New York City time) on
the day when due in U.S. dollars to the Administrative Agent at the
Administrative Agent's Account in same day funds, with payments being received
by the Administrative Agent after such time being deemed to have been received
on the next succeeding Business Day. The Administrative Agent will promptly
thereafter cause like funds to be distributed (i) if such payment by the
Borrower is in respect of principal, interest, commitment fees or any other
Obligation then payable hereunder or under the Notes, ratably in accordance with
the Pro Rata Share of such Obligations then payable and (ii) if such payment by
the Borrower is in respect of any fees or expenses payable to the Administrative
Agent for its own account and not to any Lender Party (in its capacity as a
Lender hereunder), to such Persons as they may instruct, in each case to be
applied in accordance with the terms of this Agreement or the Fee Letter, as
applicable. Upon its acceptance of an Assignment and Acceptance and recording of
the information contained therein in the Register pursuant to Section 8.07(d),
from and after the effective date of such Assignment and Acceptance, the
Administrative Agent shall make all payments hereunder and under the Notes in
respect of the interest assigned thereby to the Lender Party assignee
thereunder, and the parties to such Assignment and Acceptance shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) If the Administrative Agent receives funds for application
to the Obligations under the Loan Documents under circumstances for which the
Loan Documents do not specify the Advances or the manner in which such funds are
to be applied, the Administrative Agent may, but shall not be obligated to,
elect to distribute such funds to each Lender Party ratably in accordance with
such Lender Party's Pro Rata Share of the principal amount of all outstanding
Advances and the Available Amount of all Letters of Credit then outstanding, in
repayment or prepayment of such of the outstanding
30
Advances or other Obligations owed to such Lender Party, and for application to
such principal installments, as the Administrative Agent shall direct.
(c) All computations of interest, fees and commissions shall
be made by the Administrative Agent on the basis of a year of 360 days, in each
case for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest, fees or commissions
are payable. Each determination by the Administrative Agent of an interest rate,
fee or commission hereunder shall be conclusive and binding for all purposes,
absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or commitment fee, as
the case may be; PROVIDED, HOWEVER, that, if such extension would cause any
payment to be made in the next following calendar month, such payment shall be
made on the next preceding Business Day and such adjustment of time shall in
such case be reflected in the computation of payment of interest or commitment
fee, as the case may be.
(e) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to any Lender
Party hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender Party
on such due date an amount equal to the amount then due such Lender Party. If
and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent, each such Lender Party shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
Party together with interest thereon, for each day from the date such amount is
distributed to such Lender Party until the date such Lender Party repays such
amount to the Administrative Agent, at the Federal Funds Rate.
SECTION 2.11. TAXES. (a) Any and all payments by the Borrower
hereunder or under the Notes shall be made, in accordance with Section 2.10,
free and clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, EXCLUDING, in the case of each Lender Party and the
Administrative Agent, taxes that are imposed on its overall net income by the
United States and taxes that are imposed on its overall net income (and
franchise taxes imposed in lieu thereof) by the state or foreign jurisdiction
under the laws of which such Lender Party or the Administrative Agent (as the
case may be) is organized or any political subdivision thereof and, in the case
of each Lender Party, taxes that are imposed on its overall net income (and
franchise taxes in lieu thereof) by the state or foreign jurisdiction of such
Lender Party's Applicable Lending Office or any political subdivision thereof
(all such non-excluded taxes, levies, imposts, deductions, charges, withholdings
and liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "TAXES"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under the
Notes to any Lender Party or the Administrative Agent, (i) the sum payable by
the Borrower shall be increased as may be necessary so that after the Borrower
and the Administrative Agent have made all required deductions (including
deductions applicable to additional sums payable under this Section 2.11) such
Lender Party or the Administrative Agent, 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 all such deductions and (iii) the Borrower shall pay the
full amount deducted to the relevant taxation authority or other governmental
authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future
stamp, documentary, excise, property or similar taxes, charges or levies that
arise from any payment made hereunder or under
31
the Notes or from the execution, delivery or registration of, performance under,
or otherwise with respect to this Agreement or the Notes (hereinafter referred
to as "OTHER TAXES").
(c) The Borrower shall indemnify each Lender Party and the
Administrative Agent for and hold it harmless against the full amount of Taxes
and Other Taxes, and for the full amount of taxes of any kind imposed by any
jurisdiction on amounts payable under this Section 2.11, imposed on or paid by
such Lender Party or the Administrative Agent (as the case may be) and any
liability (including penalties, additions to tax, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be made within 10
days from the date such Lender Party or the Administrative Agent (as the case
may be) makes written demand therefor.
(d) Within ten days after the date of any payment of Taxes,
the Borrower shall furnish to the Administrative Agent, at its address referred
to in Section 8.02, the original or a certified copy of a receipt evidencing
such payment. In the case of any payment hereunder or under the Notes by or on
behalf of the Borrower through an account or branch outside the United States or
on behalf of the Borrower by a payor that is not a United States person, if the
Borrower determines that no Taxes are payable in respect thereof, the Borrower
shall furnish, or shall cause such payor to furnish, to the Administrative
Agent, at such address, an opinion of counsel acceptable to the Administrative
Agent stating that such payment is exempt from Taxes. For purposes of
subsections (d) and (e) of this Section 2.11, the terms "UNITED STATES" and
"UNITED STATES PERSON" shall have the meanings specified in Section 7701 of the
Internal Revenue Code.
(e) Each Lender Party organized under the laws of a
jurisdiction outside the United States shall, on or prior to the date of its
execution and delivery of this Agreement in the case of each Initial Lender, and
on the date of the Assignment and Acceptance pursuant to which it becomes a
Lender Party in the case of each other Lender Party, and from time to time
thereafter if requested in writing by the Borrower or the Administrative Agent
(but only so long thereafter as such Lender Party remains lawfully able to do
so), provide the Administrative Agent and the Borrower with two original
Internal Revenue Service forms W8-ECI or W8-BEN, as appropriate, or any
successor or other form prescribed by the Internal Revenue Service, certifying
that such Lender Party is exempt from or entitled to a reduced rate of United
States withholding tax on payments pursuant to this Agreement or the Notes. If
the forms provided by a Lender Party at the time such Lender Party first becomes
a party to this Agreement indicate a United States interest withholding tax rate
in excess of zero, withholding tax at such rate shall be considered excluded
from Taxes unless and until such Lender Party provides the appropriate forms
certifying that a lesser rate applies, whereupon withholding tax at such lesser
rate only shall be considered excluded from Taxes for periods governed by such
forms; PROVIDED, HOWEVEr, that if, at the effective date of the Assignment and
Acceptance pursuant to which a Lender Party becomes a party to this Agreement,
the Lender Party assignor was entitled to payments under subsection (a) of this
Section 2.11 in respect of United States withholding tax with respect to
interest paid at such date, then, to such extent, the term Taxes shall include
(in addition to withholding taxes that may be imposed in the future or other
amounts otherwise includable in Taxes) United States withholding tax, if any,
applicable with respect to the Lender Party assignee on such date. If any form
or document referred to in this subsection (e) requires the disclosure of
information, other than information necessary to compute the tax payable and
information required on the date hereof by Internal Revenue Service form W8-ECI
or W8-BEN, that the Lender Party reasonably considers to be confidential, the
Lender Party shall give notice thereof to the Borrower and shall not be
obligated to include in such form or document such confidential information.
(f) For any period with respect to which a Lender Party has
failed to provide the Borrower with the appropriate form described in subsection
(e) above (OTHER THAN if such failure is due to a change in law occurring after
the date on which a form originally was required to be provided or if such form
otherwise is not required under subsection (e) above), such Lender Party shall
not be entitled to
32
indemnification under subsection (a) or (c) of this Section 2.11 with respect to
Taxes imposed by the United States by reason of such failure; PROVIDED, HOWEVER,
that should a Lender Party become subject to Taxes because of its failure to
deliver a form required hereunder, the Borrower shall take such steps as such
Lender Party shall reasonably request to assist such Lender Party to recover
such Taxes.
(g) Notwithstanding anything herein to the contrary, the Loan
Parties, the Administrative Agent and the Lender Parties may disclose to any and
all Persons, without limitation of any kind, the U.S. tax treatment of and tax
structure of the transactions contemplated hereby and all materials of any kind
(including opinions or other tax analyses) that are provided to the Loan
Parties, the Administrative Agent or the Lender Parties, as the case may be,
relating to such U.S. tax treatment and tax structure.
SECTION 2.12. SHARING OF PAYMENTS, ETC. If any Lender Party
shall obtain at any time any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise (including pursuant to
Section 8.05, but other than as a result of an assignment pursuant to Section
8.07) (a) on account of Obligations due and payable to such Lender Party
hereunder and under the Notes at such time in excess of its Pro Rata Share
(according to the proportion of (i) the amount of such Obligations due and
payable to such Lender Party at such time to (ii) the aggregate amount of the
Obligations due and payable to all Lender Parties hereunder and under the Notes
at such time) of payments on account of the Obligations due and payable to all
Lender Parties hereunder and under the Notes at such time obtained by all the
Lender Parties at such time or (b) on account of Obligations owing (but not due
and payable) to such Lender Party hereunder and under the Notes at such time in
excess of its Pro Rata Share (according to the proportion of (i) the amount of
such Obligations owing (but not due and payable) to such Lender Party at such
time to (ii) the aggregate amount of the Obligations owing (but not due and
payable) to all Lender Parties hereunder and under the Notes at such time), such
Lender Party shall forthwith purchase from the other Lender Parties such
interests or participating interests in the Obligations due and payable or owing
to them, as the case may be, as shall be necessary to cause such purchasing
Lender Party to share the excess payment ratably with each of them; PROVIDED,
HOWEVER, that, if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender Party, such purchase from each other
Lender Party shall be rescinded and such other Lender Party shall repay to the
purchasing Lender Party the purchase price to the extent of such Lender Party's
Pro Rata Share (according to the proportion of (i) the purchase price paid to
such Lender Party to (ii) the aggregate purchase price paid to all Lender
Parties) of such recovery together with an amount equal to such Lender Party's
Pro Rata Share (according to the proportion of (i) the amount of such other
Lender Party's required repayment to (ii) the total amount so recovered from the
purchasing Lender Party) of any interest or other amount paid or payable by the
purchasing Lender Party in respect of the total amount so recovered. The
Borrower agrees that any Lender Party so purchasing an interest or participating
interest from another Lender Party pursuant to this Section 2.12 may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off) with respect to such interest or participating interest,
as the case may be, as fully as if such Lender Party were the direct creditor of
the Borrower in the amount of such interest or participating interest, as the
case may be.
SECTION 2.13. USE OF PROCEEDS. The proceeds of the Advances
and issuances of Letters of Credit shall be available solely to finance capital
improvements, repay existing indebtedness, acquire first class, full service
hotels, provide working capital and for general corporate purposes of the
Borrower, the Subsidiary Guarantors and the Parent Guarantor, but shall not be
used for the payment of dividends by the Parent Guarantor.
SECTION 2.14. EVIDENCE OF DEBT. (a) The Borrower agrees that
upon notice by any Lender Party to the Borrower (with a copy of such notice to
the Administrative Agent) to the effect that a promissory note or other evidence
of indebtedness is required or appropriate in order for such Lender
33
Party to evidence (whether for purposes of pledge, enforcement or otherwise) the
Advances owing to, or to be made by, such Lender Party, the Borrower shall
promptly execute and deliver to such Lender Party, with a copy to the
Administrative Agent, a Note, in substantially the form of EXHIBIT A hereto,
payable to the order of such Lender Party in the face principal amount equal to
the Revolving Credit Commitment of such Lender Party. Each Lender shall be
permitted only one Note for the full amount of its Revolving Credit Commitment.
All references to Notes in the Loan Documents shall mean Notes, if any, to the
extent issued hereunder.
(b) The Register maintained by the Administrative Agent
pursuant to Section 8.07(d) shall include a control account, and a subsidiary
account for each Lender, in which accounts (taken together) shall be recorded
(i) the date and amount of each Borrowing made hereunder, the Type of Advances
comprising such Borrowing and, if appropriate, the Interest Period applicable
thereto, (ii) the terms of each Assignment and Acceptance delivered to and
accepted by it, (iii) the amount of any principal or interest due and payable or
to become due and payable from the Borrower to each Lender Party hereunder, and
(iv) the amount of any sum received by the Administrative Agent from the
Borrower hereunder and each Lender Party's share thereof.
(c) Entries made in good faith by the Administrative Agent in
the Register pursuant to subsection (b) above, and by each Lender Party in its
account or accounts pursuant to subsection (a) above, shall be PRIMA FACIE
evidence of the amount of principal and interest due and payable or to become
due and payable from the Borrower to, in the case of the Register, each Lender
Party and, in the case of such account or accounts, such Lender Party, under
this Agreement, absent manifest error; PROVIDED, HOWEVER, that the failure of
the Administrative Agent or such Lender Party to make an entry, or any finding
that an entry is incorrect, in the Register or such account or accounts shall
not limit or otherwise affect the obligations of the Borrower under this
Agreement.
SECTION 2.15. CASH MANAGEMENT. (a) The Borrower and the
Operating Subsidiaries have established and shall maintain (i) an operating
account with respect to each of the Borrowing Base Properties, (ii) to the
extent there is insufficient Unused Commitments to fully fund the FF&E Reserve,
an FF&E Reserve account (the "FF&E RESERVE ACCOUNT") (collectively, the "HOTEL
ACCOUNTS") and (iii) in the Event of Default, a lockbox (the "LOCKBOX") and a
Lockbox Account at the offices of the Administrative Agent (the "LOCKBOX
Account"). The Hotel Accounts shall be established with a bank reasonably
acceptable to the Administrative Agent (the "HOTEL ACCOUNT BANK"). The Borrower
and the Operating Subsidiaries shall cause all revenues of the Borrowing Base
Properties and all other income of the Borrower and the Operating Subsidiaries
to be deposited daily into the applicable operating account and, to the extent
required hereunder, the applicable FF&E Reserve Account. The Borrower and the
Operating Subsidiaries shall have delivered to the Hotel Account Bank and to
credit card companies instructions, pursuant to which the recipients thereof
have been instructed to transfer the funds then on deposit in the Hotel Accounts
and to make all payments, respectively, directly into the Lockbox Account upon
notice from the Administrative Agent that an Event of Default has occurred
hereunder.
(b) Unless and until an Event of Default has occurred
hereunder, the Borrower and the Operating Subsidiaries have the right to direct
withdrawals from the Hotel Accounts. In the Event of Default, the Borrower and
the Operating Subsidiaries shall direct all account debtors of the Borrower and
its Subsidiaries to remit all payments in respect of the Borrowing Base
Properties and all other income directly to the Lockbox or the Lockbox Account
and shall cause the Hotel Account Bank to sweep daily into the Lockbox Account
all amounts in the Hotel Accounts. The contents of each Lockbox shall
automatically be deposited into the Lockbox Account or shall be emptied and
deposited into the Lockbox Account by a representative of the Administrative
Agent. Only the Administrative Agent shall have power of withdrawal from the
Lockbox and the Lockbox Account and the Borrower and its Subsidiaries
acknowledge that the Borrower and its Subsidiaries shall not have any control
over such Lockbox or
34
Lockbox Account or any items deposited therein. Funds on deposit in the Lockbox
Account shall be disbursed by the Administrative Agent from time to time into
the applicable Hotel Account, or directly to the payee, in either case to the
extent required to pay any real property taxes or assessments and insurance
premiums then owing in respect of any of the Borrowing Base Properties. The
Administrative Agent shall have the right to apply any other funds so on deposit
against any then outstanding Obligation hereunder, and otherwise as the
Administrative Agent may determine in its discretion.
SECTION 2.16. [Intentionally Omitted].
SECTION 2.17. AMENDED AND RESTATED PROMISSORY NOTE LEGEND.
Each Lender hereby agrees to stamp the following legend on its respective
existing amended and restated promissory note issued under the Existing
Agreement:
"This note has been renewed by that certain Amended and
Restated Promissory Note dated as of June 25, 2003."
Each Lender agrees to use commercially reasonable efforts to locate and provide
to the Borrower a copy of its respective existing amended and restated
promissory note duly stamped with the foregoing legend within 30 days after the
date hereof.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. CONDITIONS PRECEDENT TO CLOSING DATE. The
obligation of each Lender to extend the Termination Date of the Facility or to
make an Advance on the occasion of the Closing Date hereunder is subject to the
satisfaction of the following conditions precedent before or concurrently with
the Closing Date:
(a) The Administrative Agent and Lead Arranger shall have
received on or before the day of the Closing Date the following, each
dated such day (unless otherwise specified), in form and substance
satisfactory to the Administrative Agent and the Lead Arranger (unless
otherwise specified) and (except for the Notes) in sufficient copies
for each Lender Party:
(i) Notes payable to the order of the Lenders.
(ii) A Notice of Borrowing, if applicable, and a
Borrowing Base Certificate relating to the Closing Date.
(iii) (A) A consent to the subsidiary guarantor
security agreement substantially in the form of EXHIBIT D-1
(the "SUBSIDIARY GUARANTOR SECURITY AGREEMENT CONSENT",
together with the subsidiary guarantor security agreement
referred to therein, as the same may be amended, amended and
restated, supplemented or otherwise modified from time to time
in accordance with its terms, the "SUBSIDIARY GUARANTOR
SECURITY AGREEMENT"), duly executed by Borrower and each
Subsidiary Guarantor, and (B) a consent to the parent
guarantor security agreement substantially in the form of
EXHIBIT D-2 (the "PARENT GUARANTOR SECURITY AGREEMENT CONSENT"
and, together with the parent guarantor security agreement
referred to therein, as the same may be amended, amended and
restated, supplemented or otherwise modified from time to time
in accordance with its terms, the "PARENT GUARANTOR SECURITY
AGREEMENT"), duly executed by the Parent Guarantor, together
with:
35
(1) executed copies of proper financing
statements under the Uniform Commercial Code of the
states of all jurisdictions that the Administrative
Agent may deem necessary or desirable in order to
perfect and protect the Liens created under the
Collateral Documents, covering the Collateral
described in the Security Agreements,
(2) completed requests for information,
dated on or before the date of the Closing Date,
listing the financing statements referred to in
clause (A) above and all other effective financing
statements filed in the jurisdictions referred to in
clause (A) above that name any Loan Party or any of
its Subsidiaries as debtor, together with copies of
such other financing statements,
(3) evidence of the completion of all other
recordings and filings of or with respect to the
Security Agreements that the Administrative Agent and
the Lead Arranger may deem necessary or desirable in
order to perfect and protect the Liens created
thereby,
(4) executed termination statements (Form
UCC-3 or a comparable form), in proper form to be
duly filed on the date of the Closing Date under the
Uniform Commercial Code of all jurisdictions that the
Administrative Agent and the Lead Arranger may deem
desirable in order to terminate or amend existing
Liens on the Collateral described in the Security
Agreements,
(5) evidence that all other action that the
Administrative Agent and the Lead Arranger may deem
necessary or desirable in order to perfect and
protect the liens and security interests created
under the Security Agreements has been taken.
(iv) A consent to the subsidiary guaranty
substantially in the form of EXHIBIT F-2 (the "SUBSIDIARY
GUARANTY CONSENT", such Subsidiary Guaranty Modification
together with the subsidiary guaranty referred to therein, as
the same may be amended, amended and restated, supplemented or
otherwise modified from time to time in accordance with their
terms, the "SUBSIDIARY GUARANTY"), duly executed by each
Subsidiary Guarantor set forth on SCHEDULE 3.01(A)(IV).
(v) Mortgage modifications ("MORTGAGE MODIFICATIONS")
in substantially the form of EXHIBIT E hereto and covering the
Borrowing Base Properties (such Mortgage Modifications,
together with the mortgages referred to therein, as any of the
same may be amended, amended and restated, supplemented or
otherwise modified from time to time in accordance with their
terms, the "MORTGAGES"), duly executed by the appropriate Loan
Party, together with:
(A) evidence of fully paid and effective
American Land Title Association Lenders' title
insurance policies (the "MORTGAGEE TITLE INSURANCE
POLICIES") in form and substance with endorsements,
including, without limitation, Mortgage modification
endorsements, in an amount acceptable to the
Administrative Agent and the Lead Arranger, issued by
Chicago Title Insurance Company, insuring the
Mortgages, as modified, as of the time of the Closing
Date to be valid first and subsisting Liens on the
property described therein, free and clear of all
defects (including, but not limited to, mechanics'
and materialmen's Liens) and encumbrances, excepting
only those exceptions to title approved by the
Administrative Agent and the Lead Arranger; and
36
(B) such consents and agreements of lessors,
ground lessors and other third parties, and other
confirmations, as the Administrative Agent and the
Lead Arranger may deem necessary or desirable, and as
required to the extent necessary under any Material
Agreements.
(vi) [Intentionally Omitted].
(vii) Certified copies of the resolutions of the
board of directors (or persons performing similar functions)
of each Loan Party approving the Transaction and each
Transaction Document to which it is or is to be a party, and
of all documents evidencing other necessary corporate, limited
partnership or limited liability company action and
governmental approvals, if any, with respect to the
Transaction and each Transaction Document to which it is or is
to be a party and of the transactions contemplated hereby.
(viii) A copy of a certificate of the Secretary of
State (or equivalent governmental authority) of the
jurisdiction of organization of each Loan Party, dated
reasonably near the date of the Closing Date, in each case
listing the charter of each Loan Party and each amendment
thereto on file in such office and certifying that (A) such
charter is a true and correct copy thereof, (B) such
amendments are the only amendments to such charter (or similar
organizational documents) on file in his office, (C) such
Person has paid all franchise taxes (or the equivalent
thereof) to the date of such certificate and (D) such Person
is duly organized and in good standing under the laws of the
state of the jurisdiction of its organization.
(ix) A copy of a certificate of the Secretary of
State (or the equivalent governmental authority) of the states
listed on SCHEDULE 3.01(A)(IX), dated reasonably near the date
of the Closing Date, with respect to each Loan Party as listed
on SCHEDULE 3.01(A)(IX), stating that such Person is duly
qualified and in good standing as a foreign corporation,
limited partnership or limited liability company in such
states and has filed all annual reports required to be filed
to the date of such certificate.
(xi) A certificate of each Loan Party, signed on
behalf of each such Person by its Vice-President/Chief
Financial Officer and its Secretary, dated the date of the
Closing Date (the statements made in such certificate shall be
true on and as of the date of the Closing Date), certifying as
to (A) the absence of any amendments to the charter (or
similar organizational document) of such Person since the date
of the Secretary of State's (or equivalent governmental
authority's) certificate referred to in Section 3.01(a)(viii),
(B) a true and correct copy of the bylaws (or similar
organizational document) of such Person as in effect on the
date on which the resolutions referred to in Section
3.01(a)(vii) were adopted and on the date of the Closing Date,
(C) the due incorporation and good standing or valid existence
of such Person as a corporation, limited partnership or
limited liability company organized under the laws of the
jurisdiction of its organization and the absence of any
proceeding for the dissolution or liquidation of such Person,
(D) the completeness and accuracy of the representations and
warranties contained in the Loan Documents as though made on
and as of the date of the Closing Date and (E) the absence of
any event occurring and continuing, or resulting from the
Closing Date, that constitutes a Default.
37
(xii) A certificate of the Secretary of each Loan
Party certifying the names and true signatures of the officers
of such Persons authorized to sign each Transaction Document
to which it is or is to be a party and the other documents to
be delivered hereunder and thereunder.
(xiii) Such financial, business and other information
regarding each Loan Party and its Subsidiaries as the
Administrative Agent and the Lead Arranger shall have
reasonably requested upon reasonable notice in advance of the
Closing Date, including, without limitation, information as to
possible contingent liabilities, tax matters, environmental
matters, obligations under Plans, Multiemployer Plans and
Welfare Plans, collective bargaining agreements and other
arrangements with employees, audited annual financial
statements dated June 30, 2002, annual and quarterly financial
statements as to the Borrower and its Subsidiaries and each
Operating Subsidiary as of March 31, 2003.
(xiv) Certificates in substantially the form of
EXHIBITS H-1 and H-2 hereto, respectively, attesting to the
Solvency of the Parent Guarantor and its Subsidiaries on a
Consolidated basis and the Borrower and each Operating
Subsidiary after giving effect to the Transaction and the
other transactions contemplated hereby, from its Chief
Financial Officer.
(xv) Evidence of insurance naming the Administrative
Agent as additional insured and loss payee with such
responsible and reputable insurance companies or associations,
and in such amounts and covering such risks, as is
satisfactory to the Administrative Agent and the Lead
Arranger, including, without limitation, that required by
SCHEDULE 3.01(A)(XV) hereto, the Security Agreements and the
Mortgages, business interruption insurance, product liability
insurance, windstorm insurance and directors and officers
insurance.
(xvi) Favorable opinions of Akerman, Senterfitt &
▇▇▇▇▇▇, P.A. and Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP,
special counsel for the Loan Parties, in substantially the
form of EXHIBITS I-1 and I-2.
(b) Before giving effect to the Transaction and the other
transactions contemplated by this Agreement, there shall not have
occurred (i) on or prior to June 25, 2003, any change, occurrence or
development that could, in the opinion of the Administrative Agent and
the Lead Arranger, have a material adverse effect on the business,
condition (financial or otherwise), operations, performance, properties
or prospects of Parent Guarantor and its Subsidiaries taken as a whole
or any of the Subsidiary Guarantors since May 31, 2003 which has
occurred or become known to the Administrative Agent and the Lead
Arranger, (ii) on or prior to June 25, 2003, any material adverse
change in or material disruption of conditions in the financial,
banking or capital markets with catastrophic effect from those in
effect as of June 11, 2003 and which has occurred and is continuing and
which the Administrative Agent and the Lead Arranger, in their
respective reasonable discretion, deem material in connection with the
Facility, and (iii) any event, circumstance or information or matter
which in the Administrative Agent and the Lead Arranger' judgment is
inconsistent in a material and adverse manner with any event,
circumstance or information or other matter disclosed to the
Administrative Agent and the Lead Arranger by the Borrower prior to
June 11, 2003.
(c) There shall exist no action, suit, investigation,
litigation or proceeding affecting any Loan Party or any of their
Subsidiaries pending or threatened before any court, governmental
agency or arbitrator that (i) could have a material adverse effect on
the business, condition
38
(financial or otherwise), operations, performance, properties or
prospects of the Parent Guarantor and its Subsidiaries taken as a
whole, (ii) could have a Material Adverse Effect or (iii) purports to
affect the legality, validity or enforceability of the Transaction or
any Transaction Document or the consummation of the transactions
contemplated by the Transaction Documents.
(d) All governmental and third party consents and approvals
necessary in connection with the Transaction and the other transactions
contemplated by the Transaction Documents shall have been obtained
(without the imposition of any conditions that are not acceptable to
the Administrative Agent and the Lead Arranger) and shall remain in
effect; all applicable waiting periods in connection with the
Transaction and the other transactions contemplated by the Transaction
Documents shall have expired without any action having been taken by
any competent authority, and no law or regulation shall be applicable
in the judgment of the Administrative Agent and the Lead Arranger, in
each case, that restrains, prevents or imposes materially adverse
conditions upon the Transaction and the other transactions contemplated
by the Transaction Documents or the rights of the Loan Parties or their
Subsidiaries freely to transfer or otherwise dispose of, or to create
any Lien on, any properties now owned or hereafter acquired by any of
them.
(e) All accrued fees and expenses of the Secured Parties
(including the accrued fees and expenses of counsel to the
Administrative Agent, the Lead Arranger and the Syndication Agent and
of local counsel to the Lender Parties) shall have been paid.
SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING AND
ISSUANCE. The obligation of each Lender to make an Advance (other than a Letter
of Credit Advance made by the Issuing Bank or a Lender pursuant to Section
2.02(A)(c)), and the obligation of the Issuing Bank to issue a Letter of Credit
(including the initial issuance) on the occasion of each Borrowing (including
the Closing Date) shall be subject to the further conditions precedent that on
the date of such Borrowing or issuance:
(a) the Administrative Agent shall have determined that the
following statements shall be true (and each of the giving of the applicable
Notice of Borrowing or Letter of Credit Request and the acceptance by the
Borrower of the proceeds of such Borrowing or of such Letter of Credit shall
constitute a representation and warranty by the Borrower that both on the date
of such notice and on the date of such Borrowing such statements are true):
(i) the representations and warranties contained in each Loan
Document are correct on and as of such date, before and after giving effect to
such Borrowing and to the application of the proceeds therefrom, as though made
on and as of such date other than any such representations or warranties that,
by their terms, refer to a specific date other than the date of such Borrowing,
in which case as of such specific date;
(ii) no event has occurred and is continuing, or would result
from such Borrowing or from the application of the proceeds therefrom, that
constitutes a Default; and
(iii) for each Advance or issuance of any Letter of Credit,
the Borrowing Base Amount (less the Intangible Tax Reserve) exceeds the
aggregate principal amount of Advances then outstanding plus the aggregate
Available Amount of all Letters of Credit to be outstanding after giving effect
to such Advance or issuance; and
(b) the Administrative Agent shall have received such other
approvals, opinions or documents as any Lender Party through the Administrative
Agent may reasonably request.
39
SECTION 3.03. DETERMINATIONS UNDER SECTION 3.01. For purposes
of determining compliance with the conditions specified in Section 3.01, each
Lender Party shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lender Parties unless an
officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Lender
Party prior to the Closing Date specifying its objection thereto and such Lender
Party shall not have made available to the Administrative Agent such Lender
Party's Pro Rata Share of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE BORROWER.
The Borrower represents and warrants as follows:
(a) Each Loan Party (i) is a corporation, limited partnership
or limited liability company duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization,
(ii) is duly qualified and in good standing as a foreign corporation,
limited partnership or limited liability company in each other
jurisdiction in which it owns or leases property or in which the
conduct of its business requires it to so qualify or be licensed except
where the failure to so qualify or be licensed could not be reasonably
likely to have a Material Adverse Effect and (iii) has all requisite
power and authority (including, without limitation, all governmental
licenses, permits and other approvals) to own or lease and operate its
properties and to carry on its business as now conducted and as
proposed to be conducted. All of the outstanding Equity Interests in
the Subsidiary Guarantors and the Borrower have been validly issued,
are fully paid and non-assessable, and are owned by the Persons in the
amounts specified on SCHEDULE 4.01(A) hereto free and clear of all
Liens, except those created under the Collateral Documents.
(b) Set forth on SCHEDULE 4.01(B) hereto is a complete and
accurate list of Subsidiaries of the Parent Guarantor (including the
Borrower) that own any direct or indirect interest in the Borrowing
Base Properties, showing as of the date hereof (as to each such
Subsidiary) the jurisdiction of its organization, the number of shares
of each class of its Equity Interests authorized, and the number
outstanding, on the date hereof and the percentage of the outstanding
shares of each such class of its Equity Interests owned (directly or
indirectly) by the Loan Party indicated on such Schedule and the number
of shares covered by all outstanding options, warrants, rights of
conversion or purchase and similar rights at the date hereof. All of
the outstanding Equity Interests in each such Subsidiary have been
validly issued, are fully paid and non-assessable and are owned by such
designated Loan Party free and clear of all Liens, except those created
under the Collateral Documents. Each such Subsidiary (i) is a
corporation, limited partnership or limited liability company duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (ii) is duly qualified and in good
standing as a foreign corporation, limited partnership or limited
liability company, as the case may be, in each other jurisdiction in
which it owns or leases property or in which the conduct of its
business requires it to so qualify or be licensed except where the
failure to so qualify or be licensed could not be reasonably likely to
have a Material Adverse Effect and (iii) has all requisite power and
authority (including, without limitation, all governmental licenses,
permits and other approvals) to own or lease and operate its properties
and to carry on its business as now conducted and as proposed to be
conducted. All Equity Interests in the Subsidiary Guarantors and the
Borrower have been pledged to the Administrative Agent for the benefit
of the Lender Parties, and the Operating Subsidiaries own,
collectively, the Borrowing Base Properties.
40
(c) The execution, delivery and performance by each Loan Party
of each Transaction Document to which it is or is to be a party and the
other transactions contemplated by the Transaction Documents, are
within such Loan Party's powers, have been duly authorized by all
necessary action, and do not (i) contravene such Loan Party's charter,
bylaws, partnership agreement, limited liability company operating or
members agreement or similar organizational documents or agreements,
(ii) violate any law, rule, regulation (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System),
order, writ, judgment, injunction, decree, determination or award,
(iii) conflict with or result in the breach of, or constitute a default
under, any contract, loan agreement, indenture, mortgage, deed of
trust, lease or other instrument binding on or affecting any Loan
Party, any of its Subsidiaries or any of their properties or (iv)
except for the Liens created under the Loan Documents, result in or
require the creation or imposition of any Lien upon or with respect to
any of the properties of any Loan Party or any of its Subsidiaries. No
Loan Party is in violation of any such law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award or in breach
of any such contract, loan agreement, indenture, mortgage, deed of
trust, lease or other instrument, the violation or breach of which
could be reasonably likely to have a Material Adverse Effect.
(d) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for (i) the due execution,
delivery, recordation, filing or performance by any Loan Party of any
Transaction Document to which it is or is to be a party, or for the
consummation of the Transaction or the other transactions contemplated
by the Transaction Documents, (ii) the grant by any Loan Party of the
Liens granted by it pursuant to the Collateral Documents, (iii) the
perfection or maintenance of the Liens created under the Collateral
Documents (including the first priority nature thereof) or (iv) the
exercise by any Agent or any Lender Party of its rights under the Loan
Documents or the remedies in respect of the Collateral pursuant to the
Collateral Documents, except for the authorizations, approvals,
actions, notices and filings listed on SCHEDULE 4.01(D) hereto, all of
which have been duly obtained, taken, given or made and are in full
force and effect. All applicable waiting periods in connection with the
Transaction or the transactions contemplated by the Transaction
Documents have expired without any action having been taken by any
competent authority restraining, preventing or imposing materially
adverse conditions upon the Transaction and the other transactions
contemplated by the Transaction Documents or the rights of the Loan
Parties freely to transfer or otherwise dispose of, or to create any
Lien on, any properties now owned or hereafter acquired by any of them.
(e) This Agreement has been, and each other Transaction
Document when delivered hereunder will have been, duly executed and
delivered by each Loan Party party thereto. This Agreement is, and each
other Transaction Document when delivered hereunder will be, the legal,
valid and binding obligation of each Loan Party party thereto,
enforceable against such Loan Party in accordance with its terms.
(f) (i) (x) The Consolidated balance sheet of the Parent
Guarantor and its Subsidiaries at June 30, 2002, and the related
Consolidated statements of income and cash flow of the Parent Guarantor
and its Subsidiaries for the fiscal year then ended, accompanied by an
unqualified opinion of Ernst & Young LLP, independent public
accountants, (y) the Consolidated balance sheet of the Parent Guarantor
and its Subsidiaries at December 31, 2002, and the related Consolidated
statements of income and cash flow of the Parent Guarantor and its
Subsidiaries for the six months then ended, and (z) the balance sheets
of each of the Operating Subsidiaries at June 30, 2002 and December 31,
2002 and the related statements of income and cash flow for the twelve
months and six months, respectively, then ended, in each case duly
certified by the Chief Financial Officer of the Parent Guarantor,
copies of which have been furnished to each Lender
41
Party, fairly present, subject, in the case of the unaudited statements
referred to in clauses (i)(y) and (i)(z), to year-end audit
adjustments, the Consolidated financial condition of the Parent
Guarantor and its Subsidiaries and of each of the Operating
Subsidiaries at such dates and the Consolidated results of the
operations of the Parent Guarantor and its Subsidiaries and of each of
the Operating Subsidiaries for the periods ended on such dates,
respectively, all in accordance with generally accepted accounting
principles applied on a consistent basis, and
(ii) since June 30, 2002, there has not occurred any material
adverse change in the business, condition (financial or otherwise),
operations, performance, properties or prospects of the Parent
Guarantor and its Subsidiaries taken as a whole or any of the Operating
Subsidiaries (except for such matters and events demonstrated in or
incorporated into the financial statements of the Borrower and its
Subsidiaries for the period July 1, 2002 through March 31, 2003 or the
interim financial statement of the Borrower and its Subsidiaries for
the period April 1, 2003 through April 30, 2003 previously delivered to
Administrative Agent).
(g) Neither the Indenture nor any other information, exhibit
or report (excluding any financial projections) furnished by or on
behalf of any Loan Party to any Secured Party, taken as a whole, in
connection with the negotiation of the Loan Documents or pursuant to
the terms of the Loan Documents contained any untrue statement of a
material fact or omitted to state a material fact necessary to make the
statements made therein not misleading in light of the circumstances
under which such information was provided and on the date of the
Closing Date.
(h) (i) There is no action, suit, investigation, litigation or
proceeding affecting any Loan Party, including any Environmental
Action, pending or, to the best knowledge of the Borrower, threatened
before any court, governmental agency or arbitrator against any Loan
Party or the Borrowing Base Properties that (A) purports to affect the
legality, validity or enforceability of any Transaction Document or the
consummation of the Transaction or (B) except as set forth on SCHEDULE
4.01(H), could reasonably be expected to have a Material Adverse
Effect, and (ii) there has been no material adverse change in the
status, or financial effect on any Loan Party, of the litigation
disclosed on such Schedule 4.01(h).
(i) No Loan Party is engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Advance or drawings under any Letter of Credit will be
used to purchase or carry any Margin Stock or to extend credit to
others for the purpose of purchasing or carrying any Margin Stock.
(j) The Collateral Documents create a valid and perfected
first priority security interest in the Collateral securing the payment
of the Secured Obligations, and all filings and other actions necessary
or desirable to perfect and protect such security interest have been
duly taken. The Loan Parties are the legal and beneficial owners of the
Collateral free and clear of any Lien, except for the liens and
security interests created or permitted under the Loan Documents.
(k) Each Loan Party is not an "investment company," or an
"affiliated person" of, or "promoter" or "principal underwriter" for,
an "investment company," as such terms are defined in the Investment
Company Act of 1940, as amended. Neither the making of any Advances nor
the issuance of any Letters of Credit, nor the application of the
proceeds or repayment thereof by the Borrower, nor the consummation of
the other transactions contemplated hereby, will violate any provision
of such Act or any rule, regulation or order of the Securities and
Exchange Commission thereunder.
42
(l) The Loan Parties, individually, and the Borrower and its
Subsidiaries, taken as a whole, are Solvent.
(m) (i) No ERISA Event has occurred or is reasonably expected
to occur with respect to any Plan.
(ii) As of the last annual actuarial valuation date, the
funded current liability percentage, as defined in Section 302(d)(8) of
ERISA, of each Plan exceeds 90% and there has been no material adverse
change in the funding status of any such Plan since such date.
(iii) Neither any Loan Party nor any ERISA Affiliate has
incurred or is reasonably expected to incur any Withdrawal Liability to
any Multiemployer Plan.
(iv) Neither any Loan Party nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or has been terminated, within the meaning of
Title IV of ERISA, and no such Multiemployer Plan is reasonably
expected to be in reorganization or to be terminated, within the
meaning of Title IV of ERISA.
(v) Except as set forth in the financial statements referred
to in this Section 4.01 and in Section 5.03, the Loan Parties and their
respective Subsidiaries have no material liability with respect to
"expected post retirement benefit obligations" within the meaning of
Statement of Financial Accounting Standards No. 106.
(vi) Set forth on SCHEDULE 4.01(M)(VI) hereto is a complete
and accurate list of all Plans, Multiemployer Plans and Welfare Plans.
(vii) SCHEDULE B (Actuarial Information) to the most recent
annual report (Form 5500 Series), if any, for each Plan, copies of
which have been filed with the Internal Revenue Service and furnished
to the Lender Parties, is complete and accurate and fairly presents the
funding status of such Plan, and since the date of such SCHEDULE B
there has been no material adverse change in such funding status.
(n) (i) The operations and properties of the Borrower and its
Subsidiaries comply with all applicable Environmental Laws and
Environmental Permits except (A) with respect to any non-compliance
existing as of the Closing Date, as disclosed in writing to
Administrative Agent prior to the Closing Date and (B) such
non-compliance which would not (if enforced in accordance with
applicable law) result in liability in excess of $50,000 in the
aggregate. All past claims of non-compliance with such Environmental
Laws and Environmental Permits have been resolved without ongoing
obligations or costs, and no circumstances exists that could be
reasonably likely to (x) form the basis of an Environmental Action
against any of the Borrower and its Subsidiaries or any of their
properties that could have a Material Adverse Effect or (y) cause any
such property to be subject to any material restrictions on ownership,
occupancy, use or transferability under any Environmental Law.
(ii) None of the properties currently or formerly owned or
operated by any Loan Party is listed or proposed for listing on the NPL
or on the CERCLIS or any analogous foreign, state or local list or is
adjacent to any such property; there are no and never have been any
underground or aboveground storage tanks or any surface impoundments,
septic tanks, pits, sumps or lagoons in which Hazardous Materials are
being or have been treated, stored or disposed on any property
currently owned or operated by any Loan Party or, to the best of its
43
knowledge, on any property formerly owned or operated by any Loan
Party; there is no asbestos or asbestos-containing material on any
property currently owned or operated by any Loan Party; and Hazardous
Materials have not been released, discharged or disposed of on any
property currently or formerly owned or operated by any Loan Party,
except, in each case, where the non-compliance with the foregoing could
not have a Material Adverse Effect.
(iii) Each of the Loan Parties is not undertaking, and has not
completed, either individually or together with other potentially
responsible parties, any investigation or assessment or remedial or
response action relating to any actual or threatened release, discharge
or disposal of Hazardous Materials at any site, location or operation,
either voluntarily or pursuant to the order of any governmental or
regulatory authority or the requirements of any Environmental Law; and
all Hazardous Materials generated, used, treated, handled or stored at,
or transported to or from, any property currently or formerly owned or
operated by any Loan Party have been disposed of in a manner not
reasonably expected to result in material liability to any Loan Party.
(o) (i) Each Loan Party has filed, has caused to be filed or
has been included in all tax returns (Federal, state, local and
foreign) required to be filed and has paid all taxes shown thereon to
be due, together with applicable interest and penalties.
(ii) Set forth on SCHEDULE 4.01(O) hereto is a complete and
accurate list, as of the date hereof, of each taxable year of each Loan
Party for which federal income tax returns have been filed and for
which the expiration of the applicable statute of limitations for
assessment or collection has not occurred by reason of extension or
otherwise (an "OPEN YEAR").
(iii) There is no unpaid amount, as of the date hereof, of
adjustments to the federal income tax liability of each Loan Party
proposed by the Internal Revenue Service with respect to Open Years. No
issues have been raised by the Internal Revenue Service in respect of
Open Years that, in the aggregate, could have a Material Adverse
Effect.
(iv) There is no unpaid amount, as of the date hereof, of
adjustments to the state, local and foreign tax liability of each Loan
Party and its Subsidiaries and Affiliates proposed by all state, local
and foreign taxing authorities (other than amounts arising from
adjustments to federal income tax returns, if any). No issues have been
raised by such taxing authorities that, in the aggregate, could have a
Material Adverse Effect.
(v) The Transaction will not be taxable to the Parent
Guarantor, the Borrower or any of its Subsidiaries, except for the
payment of state documentary stamp tax, all of which has been paid.
(vi) The Parent Guarantor, the Borrower and its Subsidiaries
have, as of the date hereof, no net operating loss carryforwards for
U.S. federal income tax purposes.
(vii) All documentary stamp and intangible and similar taxes
owing in respect of any of the Loan Documents (including, without
limitation, the Mortgages) or which may come due under any contingency
have been paid to the applicable taxing authority; PROVIDED, HOWEVER,
that, notwithstanding anything to the contrary contained in this
Agreement, unless the Administrative Agent has received evidence of
payment of the Florida non recurring intangible personal property tax
under Chapter 199 Florida Statutes (the "INTANGIBLE TAX") with respect
to the Mortgages (including, without limitation, the Mortgage
Modifications) or the Facility, then (A) subject to subsections (B) and
(C) below, $292,000 shall at all times be maintained as Unused
Commitment (the "INTANGIBLE TAX RESERVE"), which sum shall be allocated
among the Lender Parties in
44
accordance with their respective Pro Rata Shares; (B) in the event
demand is made under the Subsidiary Guaranty, the Lenders shall have
the right, without further consent of the Borrower, to fund Advances
from the Intangible Tax Reserve in such amounts as may be necessary to
pay any Intangible Tax; and (C) the Borrower may only request
Borrowings from the Intangible Tax Reserve to pay Intangible Taxes.
(p) Neither the business nor the properties of any Loan Party
are affected by any fire, explosion, accident, strike, lockout or other
labor dispute, drought, storm, hail, earthquake, embargo, act of God or
of a public enemy or other casualty (whether or not covered by
insurance) that could be reasonably likely to have a Material Adverse
Effect.
(q) Set forth on SCHEDULE 4.01(Q) hereto is a complete and
accurate list of all Surviving Debt which, in each individual instance,
is in a principal amount in excess of $1,000,000, as shown on the
financial statements of the Parent Guarantor, the Borrower and its
Subsidiaries for the period July 1, 2002 through March 31, 2003 or the
interim financial statements of the Parent Guarantor, the Borrower and
its Subsidiaries for the period April 1, 2003 through April 30, 2003
previously delivered to the Administrative Agent, which schedule shows
in each case the principal amount outstanding, the maturity date of
such Surviving Debt and the amortization schedule (if any) therefor.
(r) All real property owned by the Borrower and its
Subsidiaries is subject to the Lien of the Mortgages. The Borrower or
such Subsidiary has good, marketable and insurable fee simple title to
such real property, free and clear of all Liens, other than Liens
created or permitted by the Loan Documents and, to the best of the
Borrower's knowledge, all of the improvements located on such
properties lie entirely within the boundaries of such properties and
none of such improvements violate any minimum set-back requirements,
other dimensional regulations or restrictions of record.
(s) Set forth on SCHEDULE 4.01(S) hereto is a complete and
accurate list of all leases of real property under which the Borrower
or any of its Subsidiaries is the lessee, showing as of the date hereof
the street address, county or other relevant jurisdiction, state,
lessor, lessee, expiration date and annual rental cost thereof. Each
such lease is the legal, valid and binding obligation of the lessor
thereof, enforceable in accordance with its terms and no default exists
thereunder.
(t) Set forth on SCHEDULE 4.01(T) hereto is a complete and
accurate list of all Investments held by the Borrower or any of its
Subsidiaries, showing as of the date hereof the amount, obligor or
issuer and maturity, if any, thereof.
(u) Set forth on SCHEDULE 4.01(U) hereto is a complete and
accurate list of all patents, trademarks, trade names, service marks
and copyrights, and all applications therefor and licenses thereof, of
the Borrower or any of its Subsidiaries, showing as of the date hereof
the jurisdiction in which registered, the registration number, the date
of registration and the expiration date.
(v) The Liens described on the Mortgagee Title Insurance
Policies and on the UCC searches delivered by the Borrower constitute a
complete and accurate list of all Liens on the property or assets of
the Borrower or any of its Subsidiaries, showing as of the date hereof
the lienholder thereof, the principal amount of the obligations secured
thereby and the property or assets of the Borrower or such Subsidiary
subject thereto.
45
(w) No Default or Event of Default exists or would result from
the incurring of any Obligations by the Borrower. None of the Borrower
or any of the other Loan Parties is in default under or with respect to
any Obligation in any respect which, individually or together with all
such defaults, could reasonably be expected to have a Material Adverse
Effect on such Person.
(x) The provisions of the Security Agreements are effective to
create, in favor of the Administrative Agent, a legal, valid and
enforceable security interest in all of the Collateral described
therein; and the Collateral was delivered to the Administrative Agent
or its nominee in accordance with the terms thereof. Each of the Liens
of each Security Agreement constitutes a perfected security interest of
the priority specified therein in all right, title and interest of the
Borrower and each other Grantor, as defined in the Security Agreements,
as the case may be, in the Collateral described therein.
(y) The provisions of the Mortgages are effective to create,
in favor of the Administrative Agent, a legal, valid and enforceable
security interest in all of the Collateral described therein. Each of
the liens of the Mortgages constitutes a perfected security interest of
the priority specified therein in all right, title and interest of the
Operating Subsidiaries and each other mortgagor, as the case may be, in
the Borrowing Base Properties described therein.
(z) All necessary and required franchises, licenses,
authorizations, registrations, permits and approvals for the use and
occupancy of each of the Borrowing Base Properties have been obtained
from all governmental authorities having jurisdiction over such
Collateral so as to permit the operation of each such Borrowing Base
Property as herein contemplated. The Borrower has provided the
Administrative Agent with true and correct copies of all of the
certificates of occupancy and other licenses, permits and approvals
respecting each of the Borrowing Base Properties of a discretionary
nature (i.e., approvals which are not considered ministerial under
applicable legal requirements, for example, zoning or use variances, or
conditional use permits), and such licenses, permits and approvals
remain in full force and effect without modification or exception.
(aa) The Operating Subsidiaries hold good and marketable fee
simple title or, to the extent acceptable to the Administrative Agent
in accordance with this Agreement, a valid leasehold interest, to each
of the Borrowing Base Properties, free and clear of all liens, claims,
assessments, encumbrances and rights of others other than the Permitted
Liens. The Operating Subsidiaries shall preserve such title to each of
the Borrowing Base Properties and will forever warrant and defend the
same and the validity and priority of the Mortgages to the
Administrative Agent against all claims whatsoever.
(bb) Each Borrowing Base Property is zoned under a use
classification which allows such Borrowing Base Property to be used in
accordance with its present or anticipated usage, which zoning is
final, unconditional and in full force and effect. Each Borrowing Base
Property is in compliance in all material respects with all applicable
zoning and land use laws, regulations and ordinances. In the event that
all or any part of the improvements on any of the Borrowing Base
Properties are destroyed or damaged, zoning laws in effect at the time
this representation is made do not prohibit the improvements from being
legally reconstructed to their condition prior to such damage or
destruction, and thereafter exist for the same use without violating
any zoning or other ordinances applicable thereto and without the
necessity of obtaining any variances or special permits. Each Borrowing
Base Property contains enough permanent parking spaces to satisfy all
requirements imposed by applicable laws with respect to parking. No
legal proceedings are pending or threatened with respect to the zoning
of any of the
46
Borrowing Base Properties. Neither the zoning nor any other right to
construct, use or operate any of the Borrowing Base Properties is in
any way dependent upon any real estate other than the applicable
Borrowing Base Property. No tract map, parcel map, condominium plan,
condominium declaration, or plat of subdivision will be recorded with
respect to any of the Borrowing Base Properties without the
Administrative Agent's prior written consent, which shall not be
unreasonably withheld or delayed.
(cc) The Borrower has provided the Administrative Agent with
true and complete copies of each contract and agreement affecting each
of the Borrowing Base Properties relating to the maintenance,
development, operation or management thereof and which (i) involves
annual payments thereunder in excess of $100,000 per year, and (ii) is
not terminable without penalty or premium upon 30 days' (or less)
notice.
(dd) Neither the Borrower nor any other Loan Party has
received any notice from any governmental authority or from any Person
with respect to any actual or threatened taking of any of the Borrowing
Base Properties, or any portion thereof, for any public or quasi-public
purpose by the exercise of the right of condemnation or eminent domain
or of any moratorium which may affect the use, or operation of any such
Borrowing Base Properties.
(ee) The Transaction is an exempt transaction under the
Truth-in-Lending Act (15 U.S.C.A. ss. 1601, ET SEQ.).
(ff) Each Borrowing Base Property has access to and full
utilization of completed public roads necessary for access to and full
utilization of such Borrowing Base Property for its intended purposes.
(gg) A tax division has been effected with respect to each
Borrowing Base Property so that it is taxed for ad valorem taxation
without regard to or inclusion of any other property. No subdivision or
other approval is necessary with respect to any of the Borrowing Base
Properties in order for any Operating Subsidiary to mortgage, convey
and otherwise deal with such Borrowing Base Property as a separate lot
or parcel.
(hh) No Insolvency Proceeding has ever been initiated or
threatened against the Borrower or any other Loan Party.
(ii) Except as set forth on SCHEDULE 4.01(S), there are no
leases covering any portion of any of the Borrowing Base Properties,
whether for present or future rights of occupancy, which cannot be
terminated upon 30 days' notice. Except for Permitted Liens, neither
the Borrower nor any other Loan Party has executed any prior assignment
of the leases, nor has it performed any act or executed any other
instrument which might prevent the Administrative Agent from operating
under or enforcing any of the terms and conditions of the mortgages
applicable to the Administrative Agent's security interest in such
leases or which would limit the Administrative Agent in such operation.
(jj) All of the improvements situated on each Borrowing Base
Properties are in good condition and repair. Neither the Borrower nor
any other Loan Party is aware of any latent or patent structural or
other significant defect or deficiency in the improvements. City water
supply, storm and sanitary sewers, and electrical and telephone
facilities are available to each Borrowing Base Property within the
boundary lines of such Borrowing Base Property, and are sufficient to
meet the reasonable needs of each Borrowing Base Property as now used
or contemplated to be used; no other utility facilities are necessary
to meet the reasonable needs of such Borrowing Base Property as now
used; and the as-built condition of such Borrowing Base Property is
such
47
that surface and storm water does not accumulate in other than
insubstantial quantities on the Borrowing Base Property and does not
drain from the Borrowing Base Property across land of adjacent
Borrowing Base Property owners. As shown on the "as built" survey for
each Borrowing Base Property, none of the improvements on any of the
Borrowing Base Properties create an encroachment over, across or upon
any of the Borrowing Base Properties' boundary lines, rights of way or
easements, and no building or other improvement on adjoining land
creates such an encroachment.
(kk) Except for Permitted Liens, there are no mechanics' or
materialmen's liens, alienable bills or other claims constituting or
that may constitute a lien on any of the Borrowing Base Properties or
any part thereof, and no work for which any such lien could be asserted
has been performed within the last 90 days, a claim for which has not
been insured against under the Mortgagee Title Insurance Policies
relating to the Borrowing Base Property upon which such work has been
performed.
(ll) No Loan Party has made any extension of credit to any of
its directors or executive officers in contravention of the
restrictions set forth in Section 402(a) of ▇▇▇▇▇▇▇▇-▇▇▇▇▇.
(mm) Each representation and warranty set forth in Article 4
of the Existing Agreement is true, correct and complete as of the
Closing Date, subject to the revised Schedules included herein.
ARTICLE V
COVENANTS
SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Advance or
any other Obligation of any Loan Party under or in respect of any Loan Document
shall remain unpaid, or any Letter of Credit shall be outstanding, or any Lender
Party shall have any Commitment hereunder, the Borrower shall:
(a) COMPLIANCE WITH LAWS, ETC. Comply, and cause each of its
Subsidiaries to comply, with all applicable federal, state and local
laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA, ▇▇▇▇▇▇▇▇-▇▇▇▇▇ and the
Racketeer Influenced and Corrupt Organizations Chapter of the Organized
Crime Control Act of 1970.
(b) PAYMENT OF TAXES, ETC. Pay and discharge, and cause each
of its Subsidiaries to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property and (ii) all lawful claims
that, if unpaid, might by law become a Lien upon its property which is
not otherwise permitted hereunder; PROVIDED, HOWEVER, that neither the
Borrower nor any of its Subsidiaries shall be required to pay or
discharge any such tax, assessment, charge or claim that is being
contested in good faith and by proper proceedings (and, as to the
Borrowing Base Properties, in compliance with the Mortgages) and as to
which appropriate reserves are being maintained, unless and until any
Lien resulting therefrom attaches to its property and becomes
enforceable against its other creditors.
(c) COMPLIANCE WITH ENVIRONMENTAL LAWS. (i) Comply, and cause
each of its Subsidiaries and all lessees and other Persons operating or
occupying its properties to comply with all applicable Environmental
Laws and Environmental Permits (other than any non-
48
compliance that would not (if enforced in accordance with applicable
law) result in liability to the Borrower or any of its Subsidiaries in
the amount in excess of $50,000 and is not, by applicable law, required
to be reported to any governmental authority); PROVIDED, HOWEVER, that
the foregoing qualification shall in no way diminish the obligations of
Borrower and its Subsidiaries under the Environmental Indemnity
Agreement; (ii) obtain and renew and cause each of its Subsidiaries to
obtain and renew all Environmental Permits necessary for its operations
and properties; and (iii) conduct, and cause each of its Subsidiaries
to conduct, any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to
remove and clean up all Hazardous Materials from any of its properties,
in accordance with the requirements of all Environmental Laws.
(d) MAINTENANCE OF INSURANCE. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as required by the Collateral Documents.
(e) PRESERVATION OF ORGANIZATIONAL EXISTENCE, ETC. Preserve
and maintain, and cause each of the Operating Subsidiaries to preserve
and maintain, (i) its existence (corporate or otherwise) and rights
(charter and statutory) and (ii) its permits, licenses, approvals,
privileges and franchises.
(f) VISITATION RIGHTS. At any reasonable time and from time to
time, upon reasonable prior notice, permit the Administrative Agent or
any of the Lender Parties or the Administrative Agent or
representatives thereof, to examine and make copies of and abstracts
from the records and books of account of, and visit the properties of,
the Borrower and any of its Subsidiaries, and to discuss the affairs,
finances and accounts of the Borrower and any of its Subsidiaries with
any of their officers or directors and with their independent certified
public accountants.
(g) KEEPING OF BOOKS. Keep, and cause each of its Subsidiaries
to keep, proper books of record and account, in which full and correct
entries shall be made of all financial transactions and the assets and
business of the Borrower and each such Subsidiary in accordance with
generally accepted accounting principles in effect from time to time.
(h) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of its
properties (and, in the case of the Borrowing Base Properties, in
compliance with the Mortgages) that are reasonably required in the
conduct of its business in good working order and condition, ordinary
wear and tear excepted; PROVIDED, HOWEVER, that the Borrower shall at
all times maintain, in cash or in the aggregate amount of all Unused
Commitments (provided that any such Unused Commitments maintained with
respect to the FF&E Reserve, taken together with Advances then
outstanding, are in compliance with Section 2.05(b)(i)), an FF&E
Reserve for any month equal to 4% of Total Revenue for a consecutive 12
calendar month period ending the last day of such month; PROVIDED
FURTHER, HOWEVER, that, for such period, this required amount shall be
reduced by any monies actually spent on the Borrowing Base Properties
during the same period for FF&E. This shall be tested on a quarterly
basis.
(i) TRANSACTIONS WITH AFFILIATES. Conduct, and cause each of
its Subsidiaries to conduct, all transactions otherwise permitted under
the Loan Documents with any of their Affiliates on terms that are fair
and reasonable and not less favorable to the Borrower or such
Subsidiary than it would obtain in a comparable arm's-length
transaction with a Person not an
49
Affiliate; PROVIDED, HOWEVER, that this Section 5.01(i) shall not apply
to the Management Contracts.
(j) FURTHER ASSURANCES. (i) Promptly upon request by the
Administrative Agent, or any Lender Party through the Administrative
Agent, correct any material defect or error that may be discovered in
any Loan Document or in the execution, acknowledgment, filing or
recordation thereof, and
(ii) Promptly upon request by the Administrative Agent, or any
Lender Party through the Administrative Agent, do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register any and all such further acts, deeds, conveyances, pledge
agreements, mortgages, assignments, financing statements and
continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments as the
Administrative Agent, or any Lender Party through the Administrative
Agent, may reasonably require from time to time in order to (A) carry
out more effectively the purposes of the Loan Documents, (B) to the
fullest extent permitted by applicable law, subject any Loan Party's or
any of its Subsidiaries' properties, assets, rights or interests to the
Liens now or hereafter intended to be covered by any of the Collateral
Documents, (C) perfect and maintain the validity, effectiveness and
priority of any of the Collateral Documents and any of the Liens
intended to be created thereunder and (D) assure, convey, grant,
assign, transfer, preserve, protect and confirm more effectively unto
the Administrative Agent and the Lender parties the rights granted or
now or hereafter intended to be granted to the Administrative Agent and
the Lender Parties under any Loan Document or under any other
instrument executed in connection with any Loan Document to which any
Loan Party or any of its Subsidiaries is or is to be a party, and cause
each of its Subsidiaries to do so.
(k) PERFORMANCE OF RELATED DOCUMENTS AND OTHER MATERIAL
AGREEMENTS. Perform and observe, and cause each of its Subsidiaries to
perform and observe, all of the terms and provisions of each Related
Document and other material agreements to be performed or observed by
it, maintain each such Related Document and other material agreements
in full force and effect, enforce such Related Document and other
material agreements in accordance with its terms, take all such action
to such end as may be from time to time reasonably requested by the
Administrative Agent and, upon the reasonable request of the
Administrative Agent, make to each other party to each such Related
Document and other material agreements such demands and requests for
information and reports or for action as such Loan Party or any of its
Subsidiaries is entitled to make under such Related Document and other
material agreements.
(l) PREPARATION OF ENVIRONMENTAL REPORTS. At the request of
the Administrative Agent, provide to the Lender Parties within 60 days
after such request, at the expense of the Borrower (provided, HOWEVER,
that Borrower shall only be required to pay for such report after the
occurrence and continuation of an Event of Default or if the
Administrative Agent's request results from its belief that there has
been a release or threatened release of Hazardous Materials at any of
Borrower's or any of its Subsidiaries' property), a Phase I
environmental site assessment report for any of its or its
Subsidiaries' properties described in such request, prepared by an
environmental consulting firm acceptable to the Administrative Agent
(and, if based upon the recommendation of such environmental consulting
firm, a Phase II environmental site assessment report) indicating the
presence or absence of Hazardous Materials and the estimated cost of
any compliance, removal or remedial action in connection with any
Hazardous Materials on such properties; without limiting the generality
of the foregoing, if the Administrative Agent determines at any time
that a material risk exists that any such requested report will not be
provided within the time referred to above, the Administrative Agent
may retain an
50
environmental consulting firm to prepare such report at the expense of
the Borrower, and the Borrower hereby grants and agrees to cause any
Subsidiary that owns any property described in such request to grant at
the time of such request, to the Administrative Agent, the Lender
Parties, such firm and any agents or representatives thereof an
irrevocable non-exclusive license, subject to the rights of tenants, to
enter onto their respective properties to undertake such an assessment.
(m) COMPLIANCE WITH TERMS OF LEASEHOLDS. Make all payments and
otherwise perform all obligations in respect of all leases of real
property to which the Borrower or any of its Subsidiaries is a party,
keep such leases in full force and effect and not allow such leases to
lapse or be terminated or any rights to renew such leases to be
forfeited or canceled, notify the Administrative Agent of any material
default by any party with respect to such leases and cooperate with the
Administrative Agent in all respects to cure any such default, and
cause each of its Subsidiaries to do so except, in any case, where the
failure to do so, either individually or in the aggregate, could not be
reasonably likely to have a Material Adverse Effect.
(n) APPRAISALS. Cause to be delivered appraisals of any or all
of the Borrowing Base Properties as may be requested either by the
Borrower or any Lender subject to the approval of the Required Lenders
at any time; PROVIDED, HOWEVER, that if the appraisal is requested by
the Lenders the Borrower shall be required to pay for only one such
appraisal per property per Fiscal Year. The selection of an appraiser
for purposes of determining the Appraised Value shall be subject to the
approval of the Administrative Agent.
(o) MANAGEMENT. Cause the Managers to operate each of the
Borrowing Base Properties at all times consistent with the manner as
currently operated as first-class luxury hotels, cause the Borrowing
Base Properties to be managed by the Managers in accordance with the
terms of the Management Contracts, perform and observe all the terms
and provisions of the Management Contracts to be performed or observed
by the Borrower or its Subsidiaries, maintain the Management Contracts
in full force and effect, enforce the Management Contracts in
accordance with their terms, take such action to such end as may be
from time to time reasonably requested by the Administrative Agent and,
upon the request of the Administrative Agent, make to the Managers such
demands and requests for information and reports or for action as the
Borrower is entitled to make under the Management Contracts. The
Management Contracts (or any of them) may be terminated by the
Administrative Agent upon 30 days' prior written notice to the Borrower
after a Default has occurred or is continuing.
(p) SINGLE PURPOSE ENTITY. Remain, and shall cause each of its
Subsidiaries to remain, at all times, a Single Purpose Entity.
(q) MAINTENANCE OF BANK ACCOUNTS. Maintain, and cause each of
its Subsidiaries to maintain, bank accounts and a cash management
system for blocked accounts acceptable to the Administrative Agent and,
upon an Event of Default, lockbox accounts.
(r) INTEREST RATE PROTECTION AGREEMENTS. To the extent
Advances exceed $50,000,000, the Borrower will purchase interest rate
caps for fifty percent (50%) of such excess amount on a basis
acceptable to the Administrative Agent; PROVIDED, HOWEVER, that
Borrower shall not be required to purchase any interest rate caps as
required by this Section 5.01(r) so long as not more than twenty-five
percent (25%) of Total Funded Debt accrues interest at a variable rate
("VARIABLE RATE DEBT"). For purposes of this Section 5.01(r), any Debt
of Parent Guarantor or its Subsidiaries which accrues interest at a
variable rate but for which Parent Guarantor or its subsidiaries has
purchased an interest rate cap or a fixed rate rate swap shall not be
deemed Variable Rate Debt.
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(s) APPLICATION OF GROSS REVENUES. Promptly apply all gross
revenues from the Borrowing Base Properties to the payment of all
current and past due operating expenses of the Borrowing Base
Properties and to the repayment of all principal, interest expense,
fees and other sums currently due or past due under the Loan Documents,
including, but not limited to, all reserve payments and any escrow or
impound payments required pursuant thereto.
(t) FF&E RESERVE. Upon the occurrence or continuance of an
Event of Default, transfer, and cause the Operating Subsidiaries to
transfer, the FF&E Reserves applicable to the Borrowing Base Properties
owned by it to the FF&E Reserve Account.
(u) MAINTAIN SOLVENCY. Remain, and shall cause the Parent
Guarantor and each of the Subsidiaries of the Borrower to remain, at
all times, Solvent.
(v) BORROWING BASE AMOUNT. Maintain, and cause each of its
Subsidiaries to maintain, the Borrowing Base Amount (less the
Intangible Tax Reserve) as defined in Section 1.01 hereto in excess of
all outstanding Advances.
(w) REGISTRY MECHANICS' LIENS. Remove of record, or cause to
be removed of record, within forty-five (45) days after the Closing
Date, all claims of liens of record recorded against the Registry
property, as described with particularity in that certain Endorsement
No. 2 to Chicago Title Insurance Company Loan Policy No. 10 1141 107
00000052 issued to Administrative Agent on or about the date hereof.
(x) INTELLECTUAL PROPERTY SECURITY AGREEMENT. Cause to be
executed and delivered to the Administrative Agent by the Subsidiary
Guarantors, within ten (10) days after the Closing Date, an
intellectual property security agreement substantially in the form
attached as Exhibit D to the Subsidiary Guarantor Security Agreement.
SECTION 5.02. NEGATIVE COVENANTS. So long as any Advance or
any other Obligation of any Loan Party under or in respect of any Loan Document
shall remain unpaid or any Letter of Credit shall be outstanding, or any Lender
Party shall have any Commitment hereunder, the Borrower shall not, and shall not
permit or suffer the Subsidiary Guarantors to, at any time:
(a) LIENS, ETC. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any Lien on or with respect to any of its properties of any
character (including, without limitation, accounts) whether now owned
or hereafter acquired, or sign or file or suffer to exist, or permit
any of its Subsidiaries to sign or file or suffer to exist, under the
Uniform Commercial Code of any jurisdiction, a financing statement that
names the Subsidiary Guarantor, the Borrower or any of its Subsidiaries
as debtor, or sign or suffer to exist, or permit any of its
Subsidiaries to sign or suffer to exist, any security agreement
authorizing any secured party thereunder to file such financing
statement, or assign, or permit any of its Subsidiaries to assign, any
accounts or other right to receive income, EXCLUDING, HOWEVER, from the
operation of the foregoing restrictions the following:
(i) Liens created under the Loan Documents;
(ii) Permitted Liens or Permitted Encumbrances;
(iii) Liens on the FF&E (including, without
limitation, purchase money liens on FF&E) arising in the
ordinary course of business;
52
(iv) any leases of FF&E, subject to (x) the limit on
Capital Leases set forth in subsection (b) below, and (y) the
Administrative Agent's receipt of any such leases, together
with evidence of lessee's right to assign its interest under
the lease to the Administrative Agent as additional security
and lessor's (i) consent to such collateral assignment and
(ii) agreement to accept any cures by the Administrative Agent
in the event of a default under the lease;
(v) Liens existing on the date hereof and described
on SCHEDULE 5.02(A)(V) hereto;
(vi) Liens arising in connection with Capitalized
Leases permitted under Section 5.02(b)(iv); PROVIDED that no
such Lien shall extend to or cover any Collateral or assets
other than the assets subject to such Capitalized Leases;
(vii) the filing of financing statements solely as a
precautionary measure in connection with operating leases
permitted under Section 5.02(b)(iii); and
(viii) the replacement, extension or renewal of any
Lien permitted by clause (iii) above upon or in the same
property theretofore subject thereto or the replacement,
extension or renewal (without increase in the amount or change
in any direct or contingent obligor) of the Debt secured
thereby.
(b) DEBT. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist,
any Debt other than:
(i) Debt under the Loan Documents;
(ii) Debt under the Subordinated Guaranty;
(iii) Capitalized Leases not to exceed, together with
Debt permitted under Section 5.02(b)(iv), $2,000,000 with
respect to each Borrowing Base Property at any time
outstanding and $6,000,000 for the Borrowing Base Properties
in the aggregate at any time outstanding;
(iv) Debt secured by Liens permitted by Section
5.02(a)(iii) not to exceed, together with Debt permitted under
Section 5.02(b)(iii), $2,000,000 with respect to each
Borrowing Base Property at any time outstanding and $6,000,000
for the Borrowing Base Properties in the aggregate at any time
outstanding;
(v) Endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course
of business; and
(vi) Debt of any Subsidiary Guarantor to the Borrower
or to the Parent Guarantor or of the Borrower to the Parent
Guarantor so long as such Debt (a) is expressly subordinated
to the Obligations hereunder (such subordination shall be
satisfactory to the Administrative Agent in its sole
discretion), and (b) is evidenced by a written instrument
which is pledged and delivered by the holder thereof as
collateral for the Obligations hereunder.
(c) CHANGE IN NATURE OF BUSINESS. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business
as carried on at the date hereof.
53
(d) MERGERS, ETC. Merge into or consolidate the Borrower or
the Operating Subsidiaries with any Person or permit any Person to
merge into the Borrower or the Operating Subsidiaries, or permit any of
the Operating Subsidiaries to do so.
(e) SALES, ETC., OF ASSETS. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer
or otherwise dispose of, any assets, or grant any option or other right
to purchase, lease or otherwise acquire any assets, except:
(i) sales of Inventory, as defined in the Security
Agreements (including, without limitation, sales of obsolete
Inventory), in the ordinary course of its business;
(ii) sales or trade-ins of used equipment for fair
value in the ordinary course of business for like assets or
cash in an aggregate amount for all of the Borrowing Base
Properties not to exceed $250,000 in any Fiscal Year;
(iii) the Borrower shall have the right to sell the
whole of any Borrowing Base Property (but not less than the
whole), but not more than two Borrowing Base Properties, and
obtain from the Administrative Agent such reconveyances of the
Mortgages securing such Borrowing Base Properties and the
release or reconveyance of such other Collateral that shall
constitute such Borrowing Base Property, upon and subject to
satisfaction of each of the following conditions as determined
in good faith by the Administrative Agent: (A) at the option
of the Administrative Agent, the Administrative Agent shall
have received, for the benefit of the Lender Parties and at
the Borrower's cost and expense, an irrevocable commitment
from a title company acceptable to the Administrative Agent
that such company shall issue an endorsement to the Mortgagee
Title Insurance Policies that the release will not affect the
lien priority of the Mortgages of those Borrowing Base
Properties that are not sold, which commitment and endorsement
shall be in form and substance satisfactory to the
Administrative Agent; (B) each Guarantor shall have executed
and delivered to the Administrative Agent such documents in
form and substance satisfactory to the Lenders as are
necessary to reaffirm the continued effectiveness and
enforceability of the Guaranties following such release; (C)
no Default shall then exist as a result of such sale or shall
occur; (D) the Borrower shall reimburse the Administrative
Agent for all reasonable costs and expenses (including,
without limitation, attorneys' fees) which the Administrative
Agent incurs in connection with any sale hereunder; (E) the
Administrative Agent shall have received a Borrowing Base
Certificate and monthly financial statements demonstrating
that after giving effect to the release (and any intended
pay-down in connection with the release) the principal amount
of the then outstanding Advances does not exceed the Borrowing
Base Amount (less the Intangible Tax Reserve); and (F) the
Loan Parties shall deliver such additional documents as
Administrative Agent may reasonably request to evidence such
Loan Parties' acknowledgment of their continuing obligations
under the Loan Documents. No sale of any of the Borrowing Base
Properties shall affect the Borrower's obligations under the
Indemnity Agreement; and
(iv) the transfer of any Pledged Shares to any
Subsidiary Guarantors in accordance with the provisions of
Section 5.02(q).
(f) INVESTMENTS. Make or hold, or permit any of its
Subsidiaries to make or hold, any Investment other than Investments by
the Borrower and its Subsidiaries in:
54
(i) wholly owned Subsidiaries of the Borrower or the
Subsidiary Guarantor outstanding on the date hereof;
(ii) the Parent Guarantor, subject to the
requirements set forth in Section 5.02(b)(vi);
(iii) loans and advances to employees in the ordinary
course of the business of the Borrower and its Subsidiaries as
presently conducted in an aggregate principal amount not to
exceed $2,000,000 at any time outstanding;
(iv) Investments by the Borrower and its Subsidiaries
in demand deposit accounts maintained in the ordinary course
of business with any Person of the type referred to in clause
(i), (ii), (iii), (iv) or (v) of the definition of "ELIGIBLE
ASSIGNEE" and in Cash Equivalents on deposit in Blocked
Accounts (as defined in the Security Agreements); and
(v) Investments existing on the date hereof and
described on SCHEDULE 4.01(T) hereto;
(g) RESTRICTED PAYMENTS. So long as any Default shall have
occurred and be continuing at the time of any action described in this
Section 5.02(g) or would result therefrom, declare or pay any
dividends, purchase, redeem, retire, defease or otherwise acquire for
value any of its Equity Interests now or hereafter outstanding, return
any capital to its stockholders, partners or members (or the equivalent
Persons thereof) as such or issue or sell any Equity Interests or
accept any capital contributions, or permit any of its Subsidiaries to
purchase, redeem, retire, defease or otherwise acquire for value Equity
Interests of the Borrower or its Subsidiaries or to issue or sell any
Equity Interests therein.
(h) AMENDMENT OF CONSTITUTIVE DOCUMENTS. Amend, or permit any
of its Subsidiaries to amend, its certificate of incorporation,
articles of organization, bylaws, operating agreement or other
constitutive documents.
(i) ACCOUNTING CHANGES. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in (A) accounting policies
or reporting practices, except as required by generally accepted
accounting principles or (B) the Fiscal Year; PROVIDED, HOWEVER, that
the Borrower and its Subsidiaries may each change its Fiscal Year to
December 31 to conform to a change by the Parent Guarantor.
(j) PREPAYMENTS, ETC., OF DEBT. (i) Prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in
any manner, or make any payment in violation of any subordination terms
of, any Debt, other than (x) the prepayment of the Advances in
accordance with the terms of this Agreement, and (y) if before and
after giving effect to any such prepayment, redemption, purchase,
defeasance or other satisfaction, no Default has occurred or would
result therefrom, regularly scheduled or required repayments or
redemptions of Surviving Debt, or (ii) amend, modify or change in any
manner any term or condition of any Surviving Debt, or permit any of
its Subsidiaries to do any of the foregoing other than to prepay any
Debt payable to the Borrower, Parent or any Subsidiary Guarantor
permitted under Section 5.02(b)(vi) hereunder.
(k) AMENDMENT, ETC., OF RELATED DOCUMENTS. Without the prior
written consent of the Administrative Agent, (i) cancel or terminate
any Related Document or consent to or accept
55
any cancellation or termination thereof, (ii) amend, modify or change
in any manner any term or condition of any Related Document or material
agreements, (iii) give any consent, waiver or approval thereunder, (iv)
waive any default under or any breach of any term or condition of any
Related Document or material agreements, (v) agree in any manner to any
other amendment, modification or change of any term or condition of any
Related Document or material agreements or (vi) take any other action
in connection with any Related Document or material agreements that
would impair the value of the interest or rights of any Loan Party
thereunder or that would impair the rights or interests of the
Administrative Agent or any Lender Party.
(l) NEGATIVE PLEDGE. Enter into or suffer to exist, or permit
any of its Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien upon
any of its property or assets other than (i) in favor of the
Administrative Agent for the benefit of the Lender Parties or (ii) in
connection with (A) the existing terms of the Indenture evidencing the
Subordinated Notes, (B) Capitalized Leases and purchase money Debt to
the extent permitted under Section 5.02(b)(iii) and solely to the
extent such agreement is limited to the property covered by such Liens,
and (C) any Debt outstanding on the date of acquisition of a Subsidiary
by any Loan Party, so long as such agreement was not entered into
solely in contemplation of such Subsidiary being so acquired.
(m) PARTNERSHIPS. Become a general partner in any general or
limited partnership or joint venture, or permit any of its Subsidiaries
to do so other than any Subsidiary Guarantor, the sole assets of which
consist of its interest in such partnership or joint venture and to the
extent permitted by Section 5.02(f)(ii).
(n) FORMATION OF SUBSIDIARIES. Organize or invest, or permit
any Subsidiary to organize or invest, in any new Subsidiary unless such
new Subsidiary: (i) is wholly owned by the Borrower and the Borrower
pledges its interest therein as collateral for all Obligations
hereunder; (ii) executes a guaranty of the Obligations hereunder; (iii)
pledges all interests in any Subsidiary Guarantor for collateral for
all Obligations hereunder; (iv) is a Single Purpose Entity; and (v)
otherwise comply with the requirements of subsection (q) below
(o) PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES. Directly or
indirectly, enter into or suffer to exist, or permit any of its
Subsidiaries to enter into or suffer to exist, any agreement or
arrangement limiting the ability of any of its Subsidiaries to declare
or pay dividends or other distributions in respect of its Equity
Interests or repay or prepay any Debt owed to, make loans or advances
to, or otherwise transfer assets to or invest in, the Borrower or any
Subsidiary of the Borrower (whether through a covenant restricting
dividends, loans, asset transfers or investments, a financial covenant
or otherwise), except (i) the Loan Documents, (ii) the existing terms
of the Indenture evidencing the Subordinated Notes and (iii) any
agreement in effect at the time such Subsidiary becomes a Subsidiary of
the Borrower, so long as such agreement was not entered into solely in
contemplation of such Person becoming a Subsidiary of the Borrower.
(p) OTHER TRANSACTIONS. Engage, or permit any of its
Subsidiaries to engage, in any transaction involving commodity options
or futures contracts or any similar speculative transactions
(including, without limitation, take-or-pay contracts).
(q) NO TRANSFER. The Borrower acknowledges that, in entering
into the Facility, the Lenders have relied to a material extent upon
the particular business reputation, expertise, creditworthiness, and
individual net worth of the Borrower, the Subsidiary Guarantors, and
all of the other persons, partnerships, trusts, corporations or other
entities who have a direct or indirect interest in the Borrower and the
Subsidiary Guarantors and upon the continuing interest which
56
such persons, partnerships, trusts, corporations or other entities, as
owners of direct or indirect interests in the Borrower and the
Subsidiary Guarantors, will have in the Borrowing Base Properties and
the Pledged Shares. Except as provided in Section 6.01 below, an Event
of Default shall occur hereunder, and the Administrative Agent shall
have the right, in its sole option, to declare the principal and
interest under the Note and all sums provided herein immediately due
and payable if, without the prior written consent of the Administrative
Agent, which may be given or withheld in its sole discretion: (1) any
of the Parent Guarantor, the Borrower or the Subsidiary Guarantors (i)
sells, conveys, transfers, disposes of, or otherwise alienates their
interests in the Borrowing Base Properties or the Pledged Shares, or
any interest therein, whether voluntarily, by the operation of law, or
otherwise, or (ii) executes a contract to do any of the foregoing
(unless the closing of such contract is expressly contingent upon
obtaining the Administrative Agent's consent to the foregoing); (2)
there occurs a change, whether directly or indirectly, in the
composition, control, ownership or structure of the Borrower or the
Subsidiary Guarantors (except as permitted by Section 5.02(e) hereof),
including (i) any direct or indirect change in, or any change in direct
or indirect ownership interests held by, any entity comprising such
Person, of whatever tier (PROVIDED that the foregoing shall not
prohibit transfers of interests in the Parent Guarantor) or (ii) any
termination of the existence of any such Person or any entity
comprising such, or any of the members or partners therein or
beneficial owners thereof, of whatever tier; or (3) any change in the
Managers, or any direct or indirect change in the composition, control,
ownership or structure of Managers (each of the events described in
clauses (1) through (3) above are referred to hereinafter as a
"TRANSFER"). Consent to a Transfer or consent to any other event
requiring consent in accordance with the foregoing shall be granted or
withheld in the Administrative Agent's discretion and, if granted,
shall not constitute a waiver of the requirement of consent for
subsequent Transfers or other events. Notwithstanding anything to the
contrary contained herein, subject to satisfying each of the conditions
set forth in Section 3.01 and pursuant to Section 5.02(e), the
Administrative Agent shall not withhold its consent to the following
Transfers ("PERMITTED TRANSFERS"): (i) Transfers of immaterial portions
of the Borrowing Base Properties to governmental authorities in
accordance with the condemnation provisions of the Mortgages; (ii)
Liens permitted pursuant to Section 5.02(a); (iii) sales of the whole
of a Borrowing Base Property in accordance with Section 5.02(e)(iii)
and (iv) leases permitted pursuant to Section 5.02(b). Notwithstanding
anything in this Section 5.02(q) to the contrary, a Transfer of Equity
Interests in any Subsidiary Guarantor other than an Operating
Subsidiary shall be deemed a Permitted Transfer upon satisfaction of
the following conditions, as determined by the Administrative Agent:
(1) at all times the Parent Guarantor shall own,
directly or indirectly, all of the Equity Interests in the
Borrower and all such Equity Interests remain subject to a
first priority Lien pursuant to the Parent Guarantor Security
Agreement;
(2) at all times the Borrower or a Subsidiary
Guarantor shall own, directly or indirectly, all of the Equity
Interests in the Person to whom the Equity Interests are
proposed to be transferred (the "PROPOSED TRANSFEREE") and all
such Equity Interests shall remain subject to a first priority
Lien in favor of the Administrative Agent. In the event the
Proposed Transferee is not an existing Subsidiary Guarantor
which has pledged all of its Equity Interests to the
Administrative Agent as security for the Obligations under the
Loan Documents, the Proposed Transferee shall execute a
Subsidiary Guaranty and either become a party to the
Subsidiary Guaranty Security Agreement (through the execution
of such amendments, supplements, or addendum as the
Administrative Agent may require) or execute such other
security agreement as may be acceptable in form and substance
to the Administrative Agent. The Administrative Agent shall
also have received such UCC financing statements and other
documents, certificates
57
and instruments as may be necessary or appropriate in the
Administrative Agent's judgment to perfect its Lien on the
Equity Interests proposed to be transferred;
(3) no Default or Event of Default shall then exist
under the Loan Documents; the Proposed Transferee must be, and
the Borrower and each Subsidiary Guarantors must remain, a
Single Purpose Entity;
(4) the Transfer shall not constitute a default or an
event of default under any Related Documents or any other
material agreements of any Loan Party;
(5) each of the Loan Documents, including, without
limitation, the Mortgages, shall be in full force and effect
and, at the Administrative Agent's request, the Administrative
Agent shall have received reaffirmations of the obligations
thereunder, in a form satisfactory to the Administrative
Agent, from the Borrower and any other Loan Parties as
requested by the Administrative Agent;
(6) not less than five Business Days prior to the
date of any Transfer, the Administrative Agent shall have
received copies of all organization documents of the Proposed
Transferee and such organization documents shall be consistent
with each of the requirements otherwise set forth in this
Agreement and the other Loan Documents;
(7) no Transfer permitted hereunder or otherwise
permitted by the Administrative Agent shall release the
Borrower or any Loan Party from any liability, if any,
hereunder, under the Loan Documents or under any other
agreement executed in connection with the Loan Documents;
(8) such Transfer shall not result in the tax
termination of the Borrower or any Operating Subsidiary;
(9) at the Administrative Agent's election, the
Administrative Agent shall have received an endorsement to its
lender's policy of title insurance issued in connection with
the Loan Documents confirming that such transfer shall not
affect the continuing lien priority of the Mortgages; and
(10) the Borrower shall have paid all of the
Administrative Agent's administrative expenses, including,
without limitation, reasonable fees and disbursements of the
Administrative Agent's counsel, incurred in connection with
the Administrative Agent's review of such transfer.
(r) SUBORDINATED NOTES AND GUARANTY. Amend, or permit, cause,
or suffer any of its Subsidiaries or the Parent Guarantor to amend the
Indenture, Note Purchase Agreement, or any other documents evidencing,
supporting, or otherwise relating to the Subordinated Notes or the
Subordinated Guaranty. Any such amendments without the consent of the
Administrative Agent shall be deemed void.
SECTION 5.03. BORROWER REPORTING REQUIREMENTS. So long as any
Obligation of any Loan Party under or in respect of any Loan Document shall
remain unpaid, or any Letter of Credit shall be outstanding, or any Lender Party
shall have any Commitment hereunder, the Borrower will furnish to the
Administrative Agent and the Lender Parties:
58
(a) DEFAULT NOTICES. As soon as possible and in any event
within two Business Days after the occurrence of each Default or any
event, development or occurrence reasonably likely to have a Material
Adverse Effect continuing on the date of such statement, a statement of
the Chief Financial Officer or Chief Accounting Officer of the Borrower
setting forth details of such Default, event, development or occurrence
and the action that the Borrower has taken and proposes to take with
respect thereto.
(b) MONTHLY FINANCIALS. As soon as available and in any event
within 45 days after the end of each month, commencing May 31, 2003, a
Consolidated balance sheet of the Borrower and its Subsidiaries, and of
each of the Operating Subsidiaries, in each case as of the end of such
month and Consolidated statements of income and cash flow of the
Borrower and its Subsidiaries, and of each of the Operating
Subsidiaries, in each case for the period commencing at the end of the
previous month and ending with the end of such month and Consolidated
statements of income and cash flow of the Borrower and its
Subsidiaries, and of the Operating Subsidiaries for the period
commencing at the end of the previous Fiscal Year and ending with the
end of such month, setting forth in each case in comparative form the
corresponding figures for the corresponding month and Fiscal
Year-to-date period of the preceding Fiscal Year, all in reasonable
detail and duly certified by the Chief Financial Officer or Chief
Accounting Officer of the Borrower, together with (i) a certificate of
such officer on behalf of the Borrower stating that no Default has
occurred and is continuing or, if a Default has occurred and is
continuing, a statement as to the nature thereof and the action that
the Borrower has taken and proposes to take with respect thereto and
(ii) in the event of any change from GAAP in the generally accepted
accounting principles used in the preparation of such financial
statements, a statement of reconciliation conforming such financial
statements to GAAP. The Borrower shall provide a compilation report
prepared by an outside accountant not more than 90 days after the
Fiscal Year end, monthly operating reports not more than 45 days after
each month end and other reviews or reports, each as acceptable to the
Administrative Agent.
(c) CAPITAL EXPENDITURE BUDGET. As soon as available and in
any event not less than 45 days prior to the end of each Fiscal Year,
each Operating Subsidiary shall provide a Capital Expenditure budget,
reasonably sufficient to properly maintain each of the Borrowing Base
Properties, for each Borrowing Base Property for the succeeding Fiscal
Year, together with a certificate of the Chief Financial Officer or
Chief Accounting Officer of the Borrower certifying the actual Capital
Expenditures for each Operating Subsidiary for the period commencing at
the end of the previous Fiscal Year and ending with the end of such
month prior to the month in which such budget is delivered.
(d) QUARTERLY FF&E RESERVE CERTIFICATES. As soon as available
and in any event within 45 days after the end of each quarter,
commencing June 30, 2003, a certificate of the Chief Financial Officer
or Chief Accounting Officer of the Borrower certifying the amount of
FF&E Reserves with respect to the Borrowing Base Properties for such
period and for the period commencing at the end of the previous Fiscal
Year and ending with the end of such quarter in which such certificate
is delivered.
(e) ERISA. (i) ERISA EVENTS AND ERISA REPORTS. (A) Promptly
and in any event within ten days after any Loan Party or any ERISA
Affiliate knows or has reason to know that any ERISA Event has
occurred, a statement of the Chief Financial Officer or Chief
Accounting Officer of the Borrower describing such ERISA Event and the
action, if any, that such Loan Party or such ERISA Affiliate has taken
and proposes to take with respect thereto and (B) on the date any
records, documents or other information must be furnished to the PBGC
with respect to any Plan pursuant to Section 4010 of ERISA, a copy of
such records, documents and information.
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(ii) PLAN TERMINATIONS. Promptly, and in any event within
three Business Days after receipt thereof by any Loan Party or any
ERISA Affiliate, copies of each notice from the PBGC stating its
intention to terminate any Plan or to have a trustee appointed to
administer any Plan.
(iii) PLAN ANNUAL REPORTS. Promptly and in any event within 30
days after the filing thereof with the Internal Revenue Service, copies
of each SCHEDULE B (Actuarial Information) to the annual report (Form
5500 Series) with respect to each Plan.
(iv) MULTIEMPLOYER PLAN NOTICES. Promptly and in any event
within five Business Days after receipt thereof by any Loan Party or
any ERISA Affiliate from the sponsor of a Multiemployer Plan, copies of
each notice concerning (A) the imposition of Withdrawal Liability by
any such Multiemployer Plan, (B) the reorganization or termination,
within the meaning of Title IV of ERISA, of any such Multiemployer Plan
or (C) the amount of liability incurred, or that may be incurred, by
such Loan Party or any ERISA Affiliate in connection with any event
described in clause (A) or (B).
(f) LITIGATION. Promptly after the commencement thereof,
notice of all actions, suits, investigations, litigation and
proceedings before any court or governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign,
affecting (i) the Borrower or any of its Subsidiaries of the type
described in Section 4.01(h) or (ii) the Parent Guarantor if such
action, claim or proceeding, if adversely determined, could result in a
judgment which would constitute an Event of Default under Section
6.01(g).
(g) CREDITOR REPORTS. Promptly after the furnishing thereof,
copies of any statement or report furnished to any other holder of the
Debt of the Borrower or of any of its Subsidiaries (including, without
limitation, the holders of the Subordinated Notes) pursuant to the
terms of any indenture, loan or credit or similar agreement and not
otherwise required to be furnished to the Lender Parties pursuant to
any other clause of this Section 5.03.
(h) AGREEMENT NOTICES. Promptly upon receipt thereof, copies
of all notices, requests and other documents received by the Borrower
or any of its Subsidiaries under or pursuant to any Related Document or
indenture, loan or credit or similar agreement regarding or related to
any breach or default by any party thereto or any other event that
could materially impair the value of the interests or the rights of the
Borrower or any of its Subsidiaries or otherwise have a Material
Adverse Effect and copies of any amendment, modification or waiver of
any provision of any Related Agreement or indenture, loan or credit or
similar agreement and, from time to time upon request by the
Administrative Agent, such information and reports regarding the
Related Documents as the Administrative Agent may reasonably request.
(i) REVENUE AGENT REPORTS. Within ten days after receipt,
copies of all Revenue Agent Reports (Internal Revenue Service Form
886), or other written proposals of the Internal Revenue Service, that
propose, determine or otherwise set forth positive adjustments to the
federal income tax liability of the affiliated group (within the
meaning of Section 1504(a)(1) of the Internal Revenue Code) of which
the Borrower is a member aggregating $250,000 or more.
(j) TAX CERTIFICATES. Promptly, and in any event within five
Business Days after the due date (with extensions) for filing the final
federal income tax return in respect of each taxable year, a
certificate (a "TAX CERTIFICATE"), signed by the President or the Chief
Financial Officer or the Chief Accounting Officer of the Borrower,
stating that the common parent of the affiliated group (within the
meaning of Section 1504(a)(1) of the Internal Revenue Code) of which
the Borrower is a member has paid to the Internal Revenue Service or
other taxing authority, or to the
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Parent Guarantor, the full amount that such affiliated group is
required to pay in respect of federal income tax for such year and that
the Parent Guarantor and its Subsidiaries have received any amounts
payable to them, and have not paid amounts in respect of taxes
(federal, state, local or foreign) in excess of the amount they are
required to pay, under the tax agreements, if any, in effect in respect
of such taxable year.
(k) ENVIRONMENTAL CONDITIONS. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of
any noncompliance by the Borrower or any of its Subsidiaries with any
Environmental Law or Environmental Permit that could (i) reasonably be
expected to have a Material Adverse Effect or (ii) cause any property
described in the Mortgages to be subject to any restrictions on
ownership, occupancy, use or transferability under any Environmental
Law.
(l) REAL PROPERTY. As soon as available and in any event
within 30 days after the end of each Fiscal Year, a report
supplementing SCHEDULE 4.01(S) hereto, including an identification of
all real and leased property disposed of by the Borrower or any of its
Subsidiaries during such Fiscal Year, a list and description (including
the street address, county or other relevant jurisdiction, state,
record owner, book value thereof, and in the case of leases of
property, lessor, lessee, expiration date and annual rental cost
thereof) of all real property acquired or leased during such Fiscal
Year and a description of such other changes in the information
included in such Schedule as may be necessary for such Schedule to be
accurate and complete.
(m) INSURANCE. As soon as available and in any event within 30
days after the end of each Fiscal Year, a report summarizing the
insurance coverage (specifying type, amount and carrier) in effect for
the Borrower and its Subsidiaries and containing such additional
information as any Lender Party (through the Administrative Agent) may
reasonably specify.
(n) BORROWING BASE CERTIFICATE. As soon as available and in
any event within 45 days after the end of each month, a Borrowing Base
Certificate, as at the end of such month, certified by the Chief
Financial Officer or the Chief Accounting Officer of the Borrower.
(o) OTHER INFORMATION. Such other information respecting the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower or any of its Subsidiaries as
any Lender Party (through the Administrative Agent) may from time to
time reasonably request, including, without limitation, all special
reports filed with the Securities and Exchange Commission or any
governmental authority that may be substituted therefor.
SECTION 5.04. PARENT GUARANTOR REPORTING REQUIREMENTS. So long
as any Obligation of any Loan Party under or in respect of any Loan Document
shall remain unpaid, or any Letter of Credit shall be outstanding, or any Lender
Party shall have any Commitment hereunder, the Parent Guarantor will furnish to
the Administrative Agent and the Lender Parties:
(a) DEFAULT AND PREPAYMENT NOTICES. As soon as possible and in
any event within two Business Days after the occurrence of each Default
or any event, development or occurrence reasonably likely to have a
Material Adverse Effect continuing on the date of such statement, a
statement of the Chief Financial Officer or the Chief Accounting
Officer of the Parent Guarantor setting forth details of such Default,
event, development or occurrence and the action that the Parent
Guarantor has taken and proposes to take with respect thereto.
(b) QUARTERLY FINANCIALS. As soon as available and in any
event within 45 days after the end of each calendar quarter, commencing
June 30, 2003, a Consolidated balance sheet of the
61
Parent Guarantor and its Subsidiaries, in each case as of the end of
such calendar quarter and a Consolidated statement of income and cash
flow of the Parent Guarantor and its Subsidiaries, in each case for the
period commencing at the end of the previous calendar quarter and
ending with the end of such calendar quarter, and a Consolidated
statement of income and cash flow of the Parent Guarantor and its
Subsidiaries for the period commencing at the end of the previous
Fiscal Year and ending with the end of such calendar quarter, setting
forth in each case in comparative form the corresponding figures for
the corresponding calendar quarter and Fiscal Year-to-date period of
the preceding Fiscal Year, all in reasonable detail and duly certified
by the Chief Financial Officer or the Chief Accounting Officer of the
Parent Guarantor, together with (i) a certificate of said officer on
behalf of the Parent Guarantor stating that no Default has occurred and
is continuing or, if a Default has occurred and is continuing, a
statement as to the nature thereof and the action that the Parent
Guarantor has taken and proposes to take with respect thereto and (ii)
a schedule in form satisfactory to the Administrative Agent of the
computations used by the Parent Guarantor in determining compliance
with the covenants contained in Section 5.05.
(c) ANNUAL FINANCIALS. As soon as available and in any event
within 93 days after the end of each Fiscal Year, a copy of the annual
audit report for such year for the Parent Guarantor and its
Subsidiaries, including therein Consolidated balance sheets of the
Parent Guarantor and its Subsidiaries, in each case as of the end of
such Fiscal Year, and Consolidated statements of income and cash flow
of the Parent Guarantor and its Subsidiaries, in each case for the
period commencing at the end of the previous Fiscal Year and ending
with the end of such Fiscal Year, accompanied as to such Consolidated
statements, by an unqualified opinion of Ernst & Young LLP or other
independent public accountants of recognized standing acceptable to the
Required Lenders, together with (i) a copy of any management letter
prepared by such accounting firm with respect to such Fiscal Year and
distributed to the Parent Guarantor, (ii) a certificate of the Chief
Financial Officer or the Chief Accounting Officer of the Parent
Guarantor stating that no Default has occurred and is continuing or, if
a default has occurred and is continuing, a statement as to the nature
thereof and the action that the Parent Guarantor has taken and proposes
to take with respect thereto, (iii) in the event of any change from
GAAP in the generally accepted accounting principles used in the
preparation of such financial statements, a statement of reconciliation
conforming such financial statements to GAAP and (iv) a schedule in
form satisfactory to the Administrative Agent of the computations used
by the Parent Guarantor in determining compliance with the covenants
contained in Section 5.05.
SECTION 5.05. PARENT GUARANTOR COVENANTS. So long as any
Advance or any other Obligation of any Loan Party under or in respect of any
Loan Document shall remain unpaid, or any Letter of Credit shall be outstanding,
or any Lender Party shall have any Commitment hereunder, the Parent Guarantor:
(a) COMPLIANCE WITH COVENANTS. Shall and shall cause the
Borrower and each of its Subsidiaries to perform and observe, all of
the terms, covenants and agreements set forth in the Loan Documents on
their part to be performed or observed or that the Borrower has agreed
to cause its Subsidiaries to perform or observe.
(b) LEVERAGE RATIO. Shall maintain at all times, on a
Consolidated basis for itself and its Subsidiaries, a Leverage Ratio,
as of the date of determination, of not more than 5.5 to 1.
(c) FIXED CHARGE COVERAGE RATIO. Shall maintain at all times,
on a Consolidated basis for itself and its Subsidiaries, a Fixed Charge
Coverage Ratio, as of the date of determination, of not less than 1.3
to 1.
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(d) BOOK NET WORTH. Shall maintain at all times, on a
Consolidated basis for itself and its Subsidiaries, a Book Net Worth of
not less than the sum of (i) $375,000,000, (ii) 75% of the value of all
equity offerings after the Closing Date, and (iii) 75% of net income
since April 1, 1999, as of the date of determination.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT. If any of the following
events ("EVENTS OF DEFAULT") shall occur and be continuing:
(a) (i) the Borrower shall fail to pay any principal of any
Advance when the same becomes due and payable, (ii) the Borrower shall
fail to prepay any principal of any Advance as required under Section
2.05(b) within five Business Days of when the same becomes due and
payable or (iii) the Borrower shall fail to pay any interest on any
Advance or any Loan Party shall fail or make any other payment under
any Loan Document within five Business Days of when the same becomes
due and payable; or
(b) any representation or warranty made by any Loan Party
(or any of its officers) under or in connection with any Loan Document
shall prove to have been incorrect in any material respect when made;
or
(c) any Loan Party shall fail to perform or observe any
term, covenant or agreement contained in Section 2.15, 5.01(e)(i),
5.01(i), 5.02 or 5.03 (other than subparagraph (c) thereof); or
(d) any Loan Party shall fail to perform or observe any
other term, covenant or agreement contained in any Loan Document on its
part to be performed or observed if such failure shall remain
unremedied for 30 days after the earlier of the date on which (A) a
Responsible Officer of the Borrower becomes aware of such failure or
(B) written notice thereof shall have been given to the Borrower by the
Administrative Agent or any Lender Party; or
(e) any Loan Party shall fail to pay any principal of,
premium or interest on or any other amount payable in respect of any
Debt that is outstanding in a principal amount (or, in the case of any
Hedge Agreement, an Agreement Value) of at least $7,500,000 either
individually or in the aggregate (but excluding Debt outstanding
hereunder) of the Loan Parties, when the same becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in the agreement or
instrument relating to such Debt; or any other event shall occur or
condition shall exist under any agreement or instrument relating to any
such Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event
or condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt or otherwise to cause, or to permit the holder
thereof to cause, such Debt to mature; or any such Debt shall be
declared to be due and payable or required to be prepaid or redeemed
(other than by a regularly scheduled required prepayment or
redemption), purchased or defeased, or an offer to prepay, redeem,
purchase or defease such Debt shall be required to be made, in each
case prior to the stated maturity thereof; or
(f) any Loan Party or any of its Subsidiaries shall
generally not pay its debts as such debts become due, or shall admit in
writing its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors; or any proceeding
shall be instituted by or against
63
any Loan Party or any of its Subsidiaries seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry
of an order for relief or the appointment of a receiver, trustee, or
other similar official for it or for any substantial part of its
property and, in the case of any such proceeding instituted against it
(but not instituted by it) that is being diligently contested by it in
good faith, either such proceeding shall remain undismissed or unstayed
for a period of 60 days or any of the actions sought in such proceeding
(including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other
similar official for, it or any substantial part of its property) shall
occur; or any Loan Party or any of its Subsidiaries shall take any
corporate action to authorize any of the actions set forth above in
this subsection (f); or
(g) any judgments or orders, either individually or in the
aggregate, for the payment of money in excess of $2,000,000 for each
Operating Subsidiary and $5,000,000 for the Parent Guarantor (to the
extent not fully paid or discharged) shall be rendered against any Loan
Party or any of its Subsidiaries and either (i) enforcement proceedings
shall have been commenced by any creditor upon such judgment or order
or (ii) there shall be any period of 10 Business Days during which a
stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; PROVIDED, HOWEVER, that
any such judgment or order shall not give rise to an Event of Default
under this Section 6.01(g) if and for so long as (A) the amount of such
judgment or order is covered by a valid and binding policy of insurance
between the defendant and the insurer, which shall be rated at least
"A" by A.M. Best Company, covering full payment thereof and (B) such
insurer has been notified, and has not disputed the claim made for
payment, of the amount of such judgment or order; or
(h) any non-monetary judgment or order shall be rendered
against any Loan Party or any of its Subsidiaries that could reasonably
be likely to have a Material Adverse Effect, and there shall be any
period of ten consecutive days during which a stay of enforcement of
such judgment or order, by reason of a pending appeal or otherwise,
shall not be in effect; or
(i) any provision of any Loan Document after delivery
thereof pursuant to Section 3.01 shall for any reason cease to be valid
and binding on or enforceable against any Loan Party to it, or any such
Loan Party shall so state in writing; or
(j) any Collateral Document after delivery thereof pursuant
to Section 3.01 shall for any reason (other than pursuant to the terms
thereof) cease to create a valid and perfected first priority lien on
and security interest in the Collateral purported to be covered
thereby; or
(k) a Change of Control shall occur; or
(l) any ERISA Event shall have occurred with respect to a
Plan and the sum (determined as of the date of occurrence of such ERISA
Event) of the Insufficiency of such Plan and the Insufficiency of any
and all other Plans with respect to which an ERISA Event shall have
occurred and then exist (or the liability of the Loan Parties and the
ERISA Affiliates related to such ERISA Event) exceeds $5,000,000; or
(m) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan in an amount that, when
aggregated with all other amounts required to be paid to Multiemployer
Plans by the Loan Parties and the ERISA Affiliates as Withdrawal
Liability (determined as of the date
64
of such notification), exceeds $5,000,000 or requires payments
exceeding 1,000,000 per annum; or
(n) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of
Title IV of ERISA, and as a result of such reorganization or
termination the aggregate annual contributions of the Loan Parties and
the ERISA Affiliates to all Multiemployer Plans that are then in
reorganization or being terminated have been or will be increased over
the amounts contributed to such Multiemployer Plans for the plan years
of such Multiemployer Plans immediately preceding the plan year in
which such reorganization or termination occurs by an amount exceeding
$1,000,000; or
(o) there shall occur any Material Adverse Change; or
(p) a default shall occur under the Subordinated Notes, the
Subordinated Guaranty, the Indenture, the Note Purchase Agreement, or
any other agreements executed by any Loan Party in connection with such
instruments;
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitments of each Lender Party and the obligation of each Lender
to make Advances (other than Letter of Credit Advances by the Issuing Bank or a
Lender pursuant to Section 2.02(A)(c)) and of the Issuing Bank to issue Letters
of Credit to be terminated, whereupon the same shall forthwith terminate, and
(ii) shall at the request, or may with the consent, of the Required Lenders, by
notice to the Borrower, declare the Advances, all interest thereon and all other
amounts payable under this Agreement, the Notes, and the other Loan Documents to
be forthwith due and payable, whereupon the Advances, all such interest and all
such amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower; PROVIDED, HOWEVER, that in the event of an actual or
deemed entry of an order for relief with respect to any Loan Party or any of its
Subsidiaries under the Federal Bankruptcy Code, (x) the Commitments of each
Lender Party and the obligation of each Lender to make Advances (other than
Letter of Credit Advances by the Issuing Bank or a Lender pursuant to Section
2.02(A)(c)) and of the Issuing Bank to issue Letters of Credit shall
automatically be terminated and (y) the Advances, all such interest and all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower.
SECTION 6.02 ACTIONS IN RESPECT OF THE LETTERS OF CREDIT UPON
DEFAULT. If any Event of Default shall have occurred and be continuing, the
Administrative Agent may, or shall at the request of the Required Lenders,
irrespective of whether it is taking any of the actions described in Sections
6.01 or 9.01(e) or otherwise, make demand upon the Borrower to, and forthwith
upon such demand the Borrower will, pay to the Administrative Agent, as
collateral agent, on behalf of the Lender Parties in same day funds at the
Administrative Agent's office designated in such demand, for deposit in the L/C
Cash Collateral Account, an amount equal to the aggregate Available Amount of
all Letters of Credit then outstanding. If at any time the Administrative Agent
determines that any funds held in the L/C Cash Collateral Account are subject to
any right or claim of any Person other than the Administrative Agent and the
Lender Parties or that the total amount of such funds is less than the aggregate
Available Amount of all Letters of Credit, the Borrower will, forthwith upon
demand by the Administrative Agent pay to the Administrative Agent, as
additional funds to be deposited and held in the L/C Cash Collateral Account, an
amount equal to the excess of (a) such aggregate Available Amount over (b) the
total amount of funds, if any, then held in the L/C Cash Collateral Account that
the Administrative Agent determines to be free and clear of any such right and
claim. Upon the drawing of any Letter of Credit for which funds are on
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deposit in the L/C Cash Collateral Account, such funds shall be applied to
reimburse the Issuing Bank or Lenders, as applicable, to the extent permitted by
applicable law.
ARTICLE VII
THE AGENTS
SECTION 7.01. AUTHORIZATION AND ACTION. DBTCA is hereby
appointed the Administrative Agent under this Agreement and the other Loan
Documents and each Lender Party (in its capacities as a Lender and an Issuing
Bank (if applicable)) hereby authorizes the Administrative Agent to act as its
agent in accordance with the terms of this Agreement and the other Loan
Documents. The Administrative Agent agrees to act upon the express conditions
contained in this Agreement and the other Loan Documents, as applicable. Subject
to the express terms of this Agreement, each Lender Party irrevocably authorizes
the Administrative Agent to take such action on such Person's behalf and to
exercise such powers hereunder and under the Loan Documents as are delegated to
the Administrative Agent by the terms hereof and thereof, together with such
powers and discretion as are reasonably incidental thereto. The Administrative
Agent have only those duties and responsibilities that are expressly specified
in this Agreement and the other Loan Documents and it may perform such duties by
or through its agents or employees. Neither Agent shall have, by reason of this
Agreement or any of the other Loan Documents, a fiduciary relationship in
respect of any Lender Party; and nothing in this Agreement or any of the other
Loan Documents, expressed or implied, is intended to or shall be so construed as
to impose upon either Agent any obligations in respect of this Agreement or any
of the other Loan Documents except as expressly set forth herein or therein. To
the extent that the consent of the Lender Parties, or any of them, is not
expressly required pursuant to this Agreement, then the Administrative Agent
shall be permitted to take such actions as it deems necessary or appropriate to
fulfill it duties under this Agreement and the other Loan Documents. The
Administrative Agent shall not be required to take any action that exposes the
Administrative Agent to personal liability or that is contrary to this Agreement
or applicable law. The Administrative Agent agrees to give to each Lender Party
prompt notice of each notice given to it by the Borrower pursuant to the terms
of this Agreement. The provisions of this Article VII are solely for the benefit
of the Secured Parties, and no Loan Party or any other Person shall have any
rights as a third party beneficiary of any of the provisions hereof. In
performing its functions and duties under this Agreement and the other Loan
Documents, the Administrative Agent shall act solely as an agent of the Lender
Parties and the Administrative Agent does not assume and shall not be deemed to
have assumed any obligation towards or relationship of agency or trust with or
for the Borrower or any other Loan Party.
SECTION 7.02. ADMINISTRATIVE AGENT'S, LEAD ARRANGER'S,
SYNDICATION AGENT'S AND DOCUMENTATION AGENT'S RELIANCE, ETC. None of
Administrative Agent, Lead Arranger, Syndication Agent or Documentation Agent or
any of their respective directors, officers, agents or employees shall be liable
for any action taken or omitted to be taken by any of them under or in
connection with the Loan Documents, except for its or their own gross negligence
or willful misconduct. Without limitation of the generality of the foregoing,
each of the Administrative Agent, the Lead Arranger, the Syndication Agent and
the Documentation Agent: (a) may treat the Lender that made any Advance as the
holder of the Debt resulting therefrom until the Administrative Agent receives
and accepts an Assignment and Acceptance entered into by such Lender, as
assignor, and an Eligible Assignee, as assignee, as provided in Section 8.07;
(b) may consult with legal counsel (including counsel for any Loan Party),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (c) makes no
warranty or representation to any Lender Party and shall not be responsible to
any Lender Party for any statements, warranties or representations (whether
written or oral) made in or in connection with the Loan Documents; (d) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of any Loan Document
66
on the part of any Loan Party or to inspect the property (including the books
and records) of any Loan Party; (e) shall not be responsible to any Lender Party
for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of, or the perfection or priority of any lien or security
interest created or purported to be created under or in connection with, any
Loan Document or any other instrument or document furnished pursuant thereto;
and (f) shall incur no liability under or in respect of any Loan Document by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by telegram, telecopy or telex) believed by it to be genuine and
signed or sent by the proper party or parties.
SECTION 7.03. DBTCA, DBSI, FLEET, SCOTIABANK AND AFFILIATES.
With respect to its Commitments, the Advances made by it and any Notes issued to
it, DBTCA, DBSI, Fleet and ScotiaBank shall each have the same rights and powers
under the Loan Documents as any other Lender Party and may exercise the same as
though each of them were not the Administrative Agent, Lead Arranger,
Syndication Agent or Documentation Agent as the case may be; and the term
"Lender Party" or "Lenders Parties" shall, unless otherwise expressly indicated,
include DBTCA, DBSI, Fleet and ScotiaBank, each in its individual capacity.
DBTCA, DBSI, Fleet and ScotiaBank and their respective affiliates may accept
deposits from, lend money to, act as trustee under indentures of, accept
investment banking engagements from and generally engage in any kind of business
with, any Loan Party, any of its Subsidiaries and any Person who may do business
with or own securities of any Loan Party or any such Subsidiary, all as if
DBTCA, DBSI, Fleet and ScotiaBank were not the Administrative Agent, Lead
Arranger, Syndication Agent and Documentation Agent, respectively, and without
any duty to account therefor to the Lender Parties.
SECTION 7.04. LENDER PARTY CREDIT DECISION. Each Lender Party
acknowledges that it has, independently and without reliance upon any other
Secured Party and based on the financial statements referred to in Section 4.01
and such other documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Lender Party
also acknowledges that it will, independently and without reliance upon any
other Secured Party 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 this Agreement.
SECTION 7.05. INDEMNIFICATION. (a) Each Lender Party severally
agrees to indemnify each of the Administrative Agent, the Lead Arranger, the
Syndication Agent and the Documentation Agent (to the extent not promptly
reimbursed by the Borrower) from and against such Lender Party's Pro Rata Share
(determined as provided below) of any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (including, without limitation, reasonable fees
and expenses of counsel) that may be imposed on, incurred by, or asserted
against such Agent in any way relating to or arising out of the Loan Documents
or any action taken or omitted by such Agent under the Loan Documents
(collectively, the "INDEMNIFIED COSTS"); PROVIDED, HOWEVER, that no Lender Party
shall be liable for any portion of such Indemnified Costs resulting from such
Agent's gross negligence or willful misconduct as found in a final,
non-appealable judgment by a court of competent jurisdiction. Without limitation
of the foregoing, each Lender Party agrees to reimburse the Administrative
Agent, the Lead Arranger, the Syndication Agent and the Documentation Agent
promptly upon demand for its Pro Rata Share of any costs and expenses
(including, without limitation, fees and expenses of counsel) payable by the
Borrower under Section 8.04, to the extent that the Administrative Agent, the
Lead Arranger, the Syndication Agent or the Documentation Agent is not promptly
reimbursed for such costs and expenses by the Borrower. For purposes of this
Section 7.05, the Lender Parties' respective Pro Rata Shares of any amount shall
be determined, at any time, according to the sum of (x) the aggregate principal
amount of the Advances outstanding at such time and owing to the respective
Lender Parties, PLUS (y) their respective Pro Rata Shares of the aggregate
Available Amount of all Letters of Credit outstanding at such time, PLUS (z)
their respective Unused
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Commitments at such time, PROVIDED that the aggregate principal amount of Letter
of Credit Advances owing to the Issuing Bank shall be considered to be owed to
the Lenders ratably in accordance with their respective Revolving Credit
Commitments.
(b) In the case of any investigation, litigation or proceeding
giving rise to any Indemnified Costs, this Section 7.05 applies whether any such
investigation, litigation or proceeding is brought by any Secured Party or a
third party. The failure of any Lender Party to reimburse the Administrative
Agent or the Issuing Bank, or the Lead Arranger, the Syndication Agent or the
Documentation Agent promptly upon demand for its Pro Rata Share of any amount
required to be paid by the Lender Parties to the Administrative Agent or the
Issuing Bank, or the Lead Arranger, the Syndication Agent or the Documentation
Agent as provided herein shall not relieve any other Lender Party of its
obligation hereunder to reimburse the Administrative Agent or the Issuing Bank,
or the Lead Arranger, the Syndication Agent or the Documentation Agent for its
Pro Rata Share of such amount, but no Lender Party shall be responsible for the
failure of any other Lender Party to reimburse the Administrative Agent or the
Issuing Bank, or the Lead Arranger, the Syndication Agent or the Documentation
Agent for such other Lender Party's Pro Rata Share of such amount.
(c) Without prejudice to the survival of any other agreement
of any Lender Party hereunder, the agreement and obligations of each Lender
Party contained in this Section 7.05 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the other
Loan Documents. In the event that any Defaulted Advance shall be owing by any
Defaulting Lender at any time, such Lender Party's Commitment shall be
considered to be unused for the purposes of this Section 7.05(c) to the extent
of the amount of such Defaulted Advance.
(d) Each Lender Party severally agrees to indemnify the
Issuing Bank (to the extent not promptly reimbursed by the Borrower) from and
against such Lender Party's Pro Rata Share (determined as provided above) of any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever that may be imposed on, incurred by, or asserted against the Issuing
Bank in any way relating to or arising out of the Loan Documents or any action
taken or omitted by the Issuing Bank under the Loan Documents; PROVIDED,
HOWEVER, that no Lender Party shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Issuing Bank's gross
negligence or willful misconduct as found in a final, non-appealable judgment by
a court of competent jurisdiction. Without limitation of the foregoing, each
Lender Party agrees to reimburse the Issuing Bank promptly upon demand for its
Pro Rata Share of any costs and expenses (including, without limitation, fees
and expenses of counsel) payable by the Borrower under Section 8.04, to the
extent that the Issuing Bank is not promptly reimbursed for such costs and
expenses by the Borrower.
SECTION 7.06. SUCCESSOR ADMINISTRATIVE AGENTS. The
Administrative Agent may resign at any time by giving written notice thereof to
the Lender Parties and the Borrower and may be removed at any time for gross
negligence or willful misconduct by an instrument or concurrent instruments in
writing delivered to the Administrative Agent and the Borrower and signed by the
Required Lenders. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving of notice of resignation or the Required
Lenders' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Lender Parties, appoint a successor
Administrative Agent, which shall be a commercial bank organized under the laws
of the United States or of any state thereof and having a combined capital and
surplus of at least $400,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent and upon the
execution and filing or recording of such financing
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statements, or amendments thereto, and such amendments or supplements to the
Mortgages, if any, and such other instruments or notices, as may be necessary or
desirable, or as the Required Lenders may request, in order to continue the
perfection of the Liens granted or purported to be granted by the Collateral
Documents, such successor Administrative Agent shall succeed to and become
vested with all the rights, powers, discretion, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations under the Loan Documents. If within
45 days after written notice is given of the retiring Administrative Agent's
resignation or removal under this Section 7.06 no successor Administrative Agent
shall have been appointed and shall have accepted such appointment, then on such
45th day (i) the retiring Administrative Agent's resignation or removal shall
become effective, (ii) the retiring Administrative Agent shall thereupon be
discharged from its duties and obligations under the Loan Documents and (iii)
the Required Lenders shall thereafter perform all duties of the retiring
Administrative Agent under the Loan Documents until such time, if any, as the
Required Lenders appoint a successor Administrative Agent as provided above.
After any retiring Administrative Agent's resignation or removal hereunder as
Administrative Agent shall become effective, the provisions of this Article VII
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.
SECTION 7.07. LEAD ARRANGER, SYNDICATION AGENT AND
DOCUMENTATION AGENT. None of the Lead Arranger, the Syndication Agent or the
Documentation Agent shall have any duties under this Agreement or any of the
other Loan Documents.
SECTION 7.08. COLLATERAL DOCUMENTS; SECURED PARTY ACTION. (a)
Each Secured Party hereby further authorizes the Administrative Agent to enter
into the Collateral Documents as secured party on behalf of and for the benefit
of the Secured Parties and agrees to be bound by the terms of the Collateral
Documents; PROVIDED that anything in this Agreement or the other Loan Documents
to the contrary notwithstanding:
(i) The Administrative Agent is authorized on behalf of all
Secured Parties, without the necessity of any notice to or further
consent from the Secured Parties, from time to time to take any action
with respect to any Collateral or the Collateral Documents which may be
necessary to perfect and maintain perfected the security interest in
and liens upon the Collateral granted pursuant to the Collateral
Documents.
(ii) Each Secured Party irrevocably authorize the
Administrative Agent, at its option and in its discretion, to release
any lien granted to or held by the Administrative Agent upon any
Collateral (A) upon payment in full of the Facility and all other
Obligations payable under this Agreement and under any other Loan
Document; (B) which is sold or to be sold or disposed of as part of or
in connection with any disposition permitted under this Agreement so
long as the Borrower is entitled to be granted such a release pursuant
to this Agreement; or (C) consisting of a guaranty or an instrument
evidencing Debt so long as the obligations under such guaranty or such
Debt evidenced by such instrument has been satisfied or paid in full.
Upon request by the Administrative Agent at any time, the Secured
Parties will confirm in writing the Administrative Agent's authority to
release particular types or items of Collateral pursuant to this
Section.
(b) Anything contained in any of the Loan Documents to the
contrary notwithstanding, each Secured Party agrees that no Secured Party shall
have any right individually to realize upon any of the Collateral under the
Collateral Documents or make demand under the Guaranties (including, without
limitation, through the exercise of a right of set-off against call deposits of
such Secured Party in which any funds on deposit in accordance with the
Collateral Documents may from time to time be invested), it being understood and
agreed that all rights and remedies under the Collateral
69
Documents and the Guaranties may be exercised solely by the Administrative Agent
for the benefit of the Secured Parties in accordance with the terms thereof.
SECTION 7.09. CERTAIN ACTIONS AFTER AN EVENT OF DEFAULT. (a)
Upon delivery to the Administrative Agent of notice of an Event of Default
pursuant to this Agreement or the Administrative Agent's otherwise obtaining
actual knowledge of the existence of an Event of Default, the Administrative
Agent shall deliver notice of such Event of Default to Lender Parties. The
Administrative Agent may thereafter, from time to time, propose various actions
(or forbearance from action) ("PROPOSED DEFAULT RESPONSE") in response to such
Event of Default, including, without limitation, foreclosure on all or portions
of the Collateral, appointment of a receiver, demand under one or more
Guaranties, or the exercise of other remedies provided in this Agreement and the
other Loan Documents, and may implement such Proposed Default Response upon
approval of the Required Lenders; PROVIDED, HOWEVER, that (i) in the absence of
any pending Proposed Default Response, beginning 30 days after the notice of the
Event of Default has been delivered to Lender Parties or was due thereto, the
Required Lenders may direct the Administrative Agent to exercise specific
remedies under the Loan Documents, and (ii) notwithstanding anything to the
contrary contained herein, at all times the Administrative Agent shall be
permitted to exercise such interim remedies (including (A) making protective
advances, and (B) appointing a receiver) as the Administrative Agent may
determine in good faith to be necessary or appropriate to protect the
Collateral.
(b) If the Required Lenders do not approve a pending Proposed
Default Response within 15 Business Days after submittal, the Proposed Default
Response shall be deemed rejected and the Required Lenders shall then be free to
direct the Administrative Agent regarding the actions to be taken or not taken
in response to the Event of Default, subject to the unanimous approval rights of
the Lenders pursuant to Section 8.01.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement or the Notes or any other Loan Document, nor consent
to any departure by the Borrower or any other Loan Party therefrom, shall in any
event be effective unless the same shall be in writing and signed (or, in the
case of the Collateral Documents, consented to) by the Required Lenders (other
than Defaulting Lenders), and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given;
provided, HOWEVER, that (a) no amendment, waiver or consent shall, unless in
writing and signed by all of the Lenders (other than any Lender that is, at such
time, a Defaulting Lender), do any of the following at any time: (i) waive any
of the conditions specified in Section 3.01 or, in the case of Advances made on
the Closing Date, Section 3.02, (ii) change the designated percentage which
constitutes the Required Lenders, (iii) release all or substantially all of the
Collateral in any transaction or series of related transactions or permit the
creation, incurrence, assumption or existence of any Lien on all or
substantially all of the Collateral in any transaction or series of related
transactions to secure any Obligations other than Obligations owing to the
Administrative Agent and the Lender Parties under the Loan Documents, (iv) amend
this Section 8.01 or (v) release the Parent Guarantor from the Parent Guaranty
or any Operating Subsidiary from the Subsidiary Guaranty, (b) no amendment,
waiver or consent shall, unless in writing and signed by two-thirds of the
Lenders (other than any Lender that is, at such time, a Defaulting Lender), do
any of the following at any time: (i) change the definition of the Borrowing
Base Amount, (ii) make changes to Section 5.05(b), (c) and (d), (iii) make
changes to Section 2.05(b) and (iv) release any individual Borrowing Base
Property in any transaction or series of related transactions or permit the
creation, incurrence, assumption or existence of any Lien on any individual
Borrowing Base Property in any transaction or series of related transactions to
secure any Obligations other than Obligations owing to the Administrative Agent
and the Lender Parties
70
under the Loan Documents and (c) no amendment, waiver or consent shall, unless
in writing and signed by the Required Lenders and each Lender that has a
Commitment under the Revolving Credit Facility and that is directly affected by
such amendment, waiver or consent, (i) increase the Commitments of such Lender
or amend Section 2.12 so as to subject such Lender to additional Obligations,
(ii) reduce the principal of, or interest or interest rate on, the Advances
payable to such Lender or any fees or other amounts payable to such Lender,
(iii) postpone any date scheduled for any payment of principal of, or interest
on, the Advances payable to such Lender pursuant to Section 2.03 or Section 2.06
or any date fixed for payment of fees or other amounts payable to such Lender or
(iv) change the order of application of any prepayment set forth in Section 2.05
in any manner that materially adversely affects such Lender; PROVIDED FURTHER
that, in addition to the Lenders required above to take such action, no
amendment, waiver or consent shall affect the rights or duties of the
Administrative Agent, the Lead Arranger, the Syndication Agent or the
Documentation Agent under this Agreement or the other Loan Documents, unless in
writing and signed by each such party that is directly affected by such
amendment, waiver or consent.
SECTION 8.02. NOTICES, ETC. All notices and other
communications provided for hereunder shall be in writing (including
telegraphic, telecopy or telex communication) and mailed, telegraphed,
telecopied, telexed or delivered by an overnight courier of nationally
recognized standing, if to the Borrower or any other Loan Party, at the address
of the Borrower at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Chief Financial Officer, telecopier number (▇▇▇) ▇▇▇-▇▇▇▇; if to any Initial
Lender, at its Domestic Lending Office specified opposite its name on SCHEDULE I
hereto; if to any other Lender Party, at its Domestic Lending Office specified
in the Assignment and Acceptance pursuant to which it became a Lender Party; and
if to the Administrative Agent, at its address at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇, telecopier number (▇▇▇) ▇▇▇-▇▇▇▇; or, as to
each party, at such other address as shall be designated by such party in a
written notice to the other parties. All such notices and communications shall,
when mailed, telegraphed, telecopied, telexed or sent by courier, be effective
when deposited in the mails, delivered to the telegraph company, transmitted by
telecopier, confirmed by telex answerback or delivered to the overnight courier,
respectively, except that notices and communications to the Administrative Agent
pursuant to Article II, III or VII shall not be effective until received by the
Administrative Agent. Delivery by telecopier of an executed counterpart of any
amendment or waiver of any provision of this Agreement or the Notes or of any
exhibit hereto to be executed and delivered hereunder shall be effective as
delivery of a manually executed counterpart thereof.
SECTION 8.03. NO WAIVER; REMEDIES. No failure on the part of
any Lender Party or the Administrative Agent to exercise, and no delay in
exercising, any right hereunder or under the Notes shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right preclude any
other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
SECTION 8.04. COSTS AND EXPENSES. (a) The Borrower agrees to
pay on demand (i) all costs and expenses of the Administrative Agent, the Lead
Arranger, the Syndication Agent and the Documentation Agent in connection with
the preparation, execution, delivery, administration, modification and amendment
of the Loan Documents (including, without limitation, (A) all due diligence,
collateral review, syndication, transportation, computer, duplication,
appraisal, audit, insurance, consultant, search, filing and recording fees and
expenses and (B) the reasonable fees and expenses of counsel for each of the
Administrative Agent, the Lead Arranger, the Syndication Agent and the
Documentation Agent with respect thereto, with respect to advising the
Administrative Agent, the Lead Arranger, the Syndication Agent and the
Documentation Agent as to their respective rights and responsibilities, or the
perfection, protection or preservation of rights or interests, under the Loan
Documents, with respect to negotiations with any Loan Party or with other
creditors of any Loan Party or
71
any of its Subsidiaries arising out of any Default or any events or
circumstances that may give rise to a Default and with respect to presenting
claims in or otherwise participating in or monitoring any bankruptcy, insolvency
or other similar proceeding involving creditors' rights generally and any
proceeding ancillary thereto) and (ii) all costs and expenses of the Secured
Parties in connection with the enforcement of the Loan Documents, whether in any
action, suit or litigation, any bankruptcy, insolvency or other similar
proceeding affecting creditors' rights generally (including, without limitation,
the reasonable fees and expenses of counsel for the Secured Parties with respect
thereto).
(b) (i) To the fullest extent permitted by applicable law, the
Loan Parties agree, jointly and severally, to indemnify and hold harmless each
of the Secured Parties and the affiliated entities, directors, officers,
employees, legal counsel, agents and controlling persons (within the meaning of
the federal securities laws) of each of the Secured Parties (collectively, the
"INDEMNIFIED PARTIES"), from and against any and all losses, claims, damages,
obligations, penalties, judgments, awards, liabilities, costs, expenses and
disbursements and any and all actions, suits, proceedings and investigations in
respect thereof and any and all legal or other costs, expenses and disbursements
in giving testimony or furnishing documents in response to a subpoena or
otherwise (including, without limitation, the costs, expenses and disbursements,
as and when incurred, of investigating, preparing or defending any such action,
proceeding or investigation (whether or not in connection with litigation in
which any of the Indemnified Parties is a party) and including, without
limitation, any and all losses, claims, damages, obligations, penalties,
judgments, awards, liabilities, costs, expenses and disbursements, resulting
from any negligent act or omission of any of the Indemnified Parties), directly
or indirectly, caused by, relating to, based upon, arising out of or in
connection with (A) the Transaction, (B) the Transaction Documents, (C) the Fee
Letter, or (D) any untrue statement or alleged untrue statement of a material
fact contained in, or omissions or alleged omissions from any filing with any
governmental agency or similar statements or omissions in or from any
information furnished by the Parent Guarantor or any of its Subsidiaries or
Affiliates to any of the Indemnified Parties or any other person in connection
with the Transaction or the Transaction Documents; PROVIDED, HOWEVER, that such
indemnity agreement shall not apply to any portion of any such loss, claim,
damage, obligation, penalty, judgment, award, liability, cost, expense or
disbursement to the extent it is found in a final judgment by a court of
competent jurisdiction (not subject to further appeal) to have resulted
primarily and directly from the gross negligence or willful misconduct of any of
the Indemnified Parties. The indemnification provisions contained in this
Section 8.04(b) shall be in addition to any liability which any Loan Party may
have to the Indemnified Parties. If any action, suit, proceeding or
investigation is commenced, as to which any of the Indemnified Parties proposes
to demand indemnification, it shall notify the Borrower with reasonable
promptness; PROVIDED, HOWEVER, that any failure by any of the Indemnified
Parties to so notify the Borrower shall not relieve the Borrower or any other
Loan Party from its obligations hereunder. Each of the Administrative Agent and
Lead Arranger, on behalf of the Indemnified Parties, shall have the right to
retain counsel of its choice to represent the Indemnified Parties, and the
Borrower shall, or shall cause the other Loan Parties, jointly and severally to
pay, the fees, expenses and disbursement of such counsel; and such counsel
shall, to the extent consistent with its professional responsibilities,
cooperate with the Borrower and the other Loan Parties and any counsel
designated by the Borrower or the other Loan Parties. The Borrower and the Loan
Parties shall be jointly and severally liable for any settlement of any claim
against any of the Indemnified Parties made with the Borrower's written consent,
which consent shall not be unreasonably withheld. Without the prior written
consent of the Administrative Agent and the Lead Arranger, the Borrower shall
not, and shall not permit any of the other Loan Parties to, settle or compromise
any claim, or permit a default or consent to the entry of any judgment in
respect thereof, unless such settlement, compromise or consent includes, as an
unconditional term thereof, the giving by the claimant to each of the
Indemnified Parties of an unconditional and irrevocable release from all
liability in respect of such claim. No party hereto liable for any damages
hereunder to any other party shall ever be liable for any special, indirect or
consequential damages or, to the fullest extent that a claim for punitive
damages may lawfully be waived, for any punitive damages on any claim (whether
founded in contract, tort, legal duty
72
or any other theory of liability) arising from or related in any manner to the
Loan Documents or the negotiation, execution, administration, performance,
breach or enforcement of the Loan Documents or any amendment thereto or the
consummation of, or any failure to consummate, the Transaction or any act,
omission, breach or wrongful conduct in any manner related thereto.
(ii) In order to provide for just and equitable contribution,
if a claim for indemnification pursuant to the indemnification provisions of
this Section 8.04(b) is made but is found in a final judgment by a court of
competent jurisdiction (not subject to further appeal) that such indemnification
may not be enforced in such case, even though the express provisions hereof
provide for indemnification in such case, then the Borrower and other Loan
Parties, if any, on the one hand, and the Indemnified Parties, on the other
hand, shall contribute to the losses, claims, damages, obligations, penalties,
judgments, awards, liabilities, costs, expenses and disbursements to which the
Indemnified Parties may be subject in accordance with the relative benefits
received by the Borrower and the other Loan Parties, on the one hand, and the
Indemnified Parties, on the other hand, and also the relative fault of the
Borrower and the other Loan Parties, on the one hand, and the Indemnified
Parties, on the other hand, in connection with the statements, acts or omissions
which resulted in such losses, claims, damages, obligations, penalties,
judgments, awards, liabilities, costs, expenses and disbursements and the
relevant equitable considerations shall also be considered. No person found
liable for a fraudulent misrepresentation shall be entitled to contribution from
any other person who is not also found liable for such fraudulent
misrepresentation. Notwithstanding the foregoing, none of the Indemnified
Parties shall be obligated to contribute any amount hereunder that exceeds the
amount of fees (but not interest) previously received by such Indemnified Party
pursuant to the Transaction Documents.
(iii) This Agreement does not create, and shall not be
construed as creating, any rights enforceable by a person or entity not a party
hereto, except as provided in this Section 8.04(b). The Borrower, on behalf of
itself and each other Loan Party, acknowledges and agrees that: (A) none of the
Secured Parties is, nor shall any one of them be construed as, a fiduciary or
agent of any Loan Party or any other person and shall have no duties or
liabilities to any such person's equity holders or creditors by virtue of this
Agreement, which is hereby expressly waived, and none of the Administrative
Agent, the Lead Arranger, the Syndication Agent or the Documentation Agent has
been retained to advise or has advised the Borrower regarding the wisdom,
prudence or advisability of entering into this Agreement or consummating the
Transaction; (B) none of the Secured Parties shall have any liability
(including, without limitation, liability for any losses, claims, damages,
obligations, penalties, judgments, awards, liabilities, costs, expenses or
disbursements resulting from any negligent act or omission of any of them)
(whether direct or indirect, in contract, tort or otherwise) to the Borrower or
any other Loan Party (including, without limitation, their respective equity
holders and creditors) or any other person for or in connection with this
Agreement or the Transaction, except that a claim in contract for actual direct
damages directly and proximately caused by a breach of any contractual
obligation expressly set forth in any written agreement signed by the party
against which enforcement of such claim is sought shall not be impaired hereby;
and (C) each of the Administrative Agent, the Lead Arranger, the Syndication
Agent and the Documentation Agent was induced to enter into this Agreement by,
INTER ALIA, this Article VIII.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender Party other than on the last day of the Interest Period for such Advance,
as a result of an assignment in connection with a syndication of the Facility
during the period from the Closing Date to the earlier of (x) three months from
such Date and (y) the completion of syndication of the Facility (as shall be
specified by the Administrative Agent in a written notice to the Borrower), a
payment or Conversion pursuant to Section 2.05, 2.08(b)(i) or 2.09(d),
acceleration of the maturity of the Advances pursuant to Section 6.01 or for any
other reason or by an Eligible Assignee to a Lender Party other than on the last
day of the Interest Period for such Advance upon an assignment of rights and
obligations under this Agreement pursuant to Section 8.07 as a result of
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a demand by the Borrower pursuant to Section 8.07(a), the Borrower shall, upon
demand by such Lender Party (with a copy of such demand to the Administrative
Agent), pay to the Administrative Agent for the account of such Lender Party any
amounts required to compensate such Lender Party for any additional losses,
costs or expenses that it may reasonably incur as a result of such payment,
including, without limitation, any loss (including loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Lender Party to fund or maintain such
Advance.
(d) If any Loan Party fails to pay when due any costs,
expenses or other amounts payable by it under any Loan Document, including,
without limitation, fees and expenses of counsel and indemnities, such amount
may be paid on behalf of such Loan Party by the Administrative Agent or any
Lender Party, in its sole discretion.
(e) Without prejudice to the survival of any other agreement
of any Loan Party hereunder or under any other Loan Document, the agreements and
obligations of the Borrower contained in Sections 2.09 and 2.11 and this Section
8.04 shall survive the payment in full of principal, interest and all other
amounts payable hereunder and under any of the other Loan Documents.
SECTION 8.05. RIGHT OF SET-OFF. Upon (a) the occurrence and
during the continuance of any Event of Default and (b) the making of the request
or the granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Advances due and payable pursuant to the
provisions of Section 6.01, each Lender Party and each of its respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender Party or such
Affiliate to or for the credit or the account of the Borrower against any and
all of the Obligations of the Borrower now or hereafter existing under this
Agreement and the Note or Notes held by such Lender Party, irrespective of
whether such Lender Party shall have made any demand under this Agreement or
such Note or Notes and although such obligations may be unmatured. Each Lender
Party agrees promptly to notify the Borrower after any such set-off and
application; PROVIDED, HOWEVER, that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Lender
Party and its respective Affiliates under this Section are in addition to other
rights and remedies (including, without limitation, other rights of set-off)
that such Lender Party and its respective Affiliates may have. Notwithstanding
anything in the foregoing to the contrary, no Lender Party shall exercise any
right of set-off against any Loan Party with respect to the Borrower's
Obligations under the Loan Documents without the prior written consent of the
Administrative Agent if the exercise of such right could limit or adversely
affect the remedies available to the Lender Parties or restrict the order of the
exercise of such remedies under any law applicable to the parties or to the
exercise of any such remedies. If any Lender Party shall receive any payment or
proceeds from any Loan Party in respect of the Obligations, such Person shall
immediately pay such amounts to the Administrative Agent for distribution to the
other Lender Parties in accordance with this Agreement and the other Loan
Documents. In the event that any such Lender Party improperly exercises any
right of set-off in violation of the terms of this Agreement, then such Person
shall indemnify, defend and hold harmless the Administrative Agent and each of
the other Persons among the Lender Parties from any loss or injury that may
result from such Person's exercise of its right of set-off.
SECTION 8.06. BINDING EFFECT. This Agreement shall become
effective when it shall have been executed by the Borrower and the
Administrative Agent and when the Administrative Agent shall have been notified
by each Initial Lender that such Initial Lender has executed it and thereafter
shall be binding upon and inure to the benefit of the Borrower, the
Administrative Agent and each Lender Party and their respective successors and
assigns, except that the Borrower shall not have the right to assign its rights
hereunder or any interest herein without the prior written consent of the Lender
Parties.
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SECTION 8.07. ASSIGNMENTS AND PARTICIPATIONS. (a) Each Lender
may assign to one or more Eligible Assignees all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment or Commitments, the Advances owing to it and the Note
or Notes held by it); PROVIDED, HOWEVER, that (i) each such assignment shall be
of a uniform, and not a varying, percentage of all rights and obligations under
and in respect of the Facility, (ii) except in the case of an assignment to a
Person that, immediately prior to such assignment, was a Lender, an Affiliate of
any Lender or an Approved Fund of any Lender or an assignment of all of a
Lender's rights and obligations under this Agreement, the aggregate amount of
the Commitments being assigned to such Eligible Assignee pursuant to such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $1,000,000 and shall
be in an integral multiple of $500,000, (iii) each such assignment shall be to
an Eligible Assignee, and (iv) the parties to each such assignment shall execute
and deliver to the Administrative Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance, together with the Note or Notes subject
to such assignment and a processing and recordation fee of $3,500.
(b) Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in such Assignment and Acceptance,
(x) the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender or the
Issuing Bank hereunder and (y) the Lender or the Issuing Bank assignor
thereunder shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under this Agreement (and, in the case of
an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender's or the Issuing Bank's rights and obligations under this
Agreement, such Lender or the Issuing Bank shall cease to be a party hereto).
(c) By executing and delivering an Assignment and Acceptance,
each Lender Party assignor thereunder and each assignee thereunder confirms to
and agrees with each other and the other parties thereto and hereto as follows:
(i) other than as provided in such Assignment and Acceptance, such assigning
Lender Party makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with this Agreement or any other Loan Document or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created or purported to
be created under or in connection with, this Agreement or any other Loan
Document or any other instrument or document furnished pursuant hereto or
thereto; (ii) such assigning Lender Party makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower or any other Loan Party or the performance or observance by any Loan
Party of any of its obligations under any Loan Document or any other instrument
or document furnished pursuant thereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.01 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon any Secured Party 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 this
Agreement; (v) such assignee confirms that it is an Eligible Assignee; (vi) such
assignee appoints and authorizes the Administrative Agent to take such action as
Administrative Agent on its behalf and to exercise such powers and discretion
under the Loan Documents as are delegated to the Administrative Agent by the
terms hereof, together with such powers and discretion as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of this
Agreement are required to be performed by it as a Lender or the Issuing Bank, as
the case may be.
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(d) The Administrative Agent shall maintain at its address
referred to in Section 8.02 a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names and
addresses of the Lender Parties and the Commitment under the Facility of, and
principal amount of the Advances owing under the Facility to, each Lender Party
from time to time (the "REGISTER"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the Borrower
and the Secured Parties may treat each Person whose name is recorded in the
Register as a Lender Party hereunder for all purposes of this Agreement. The
Register shall be available for inspection by the Borrower or any Lender Party
at any reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender Party and an assignee, together with the Note or Notes
requested by the Assignee subject to such assignment, the Administrative Agent
shall, if such Assignment and Acceptance has been completed and is in
substantially the form of EXHIBIT C hereto, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower.
(f) Each Lender Party may sell participations in or to all or
a portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitments, the Advances owing to it and
the Note or Notes held by it) to any Person other than any Loan Party or any of
its Subsidiaries or Affiliates; PROVIDED, HOWEVER, that (i) such Lender Party's
obligations under this Agreement (including, without limitation, its
Commitments) shall remain unchanged, (ii) such Lender Party shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender Party shall remain the holder of such Advances and such Note
for all purposes of this Agreement, (iv) the Borrower and the Secured Parties
shall continue to deal solely and directly with such Lender Party in connection
with such Lender Party's rights and obligations under this Agreement and (v) no
participant under any such participation shall have any right to approve any
amendment or waiver of any provision of any Loan Document, or any consent to any
departure by any Loan Party therefrom, except to the extent that such amendment,
waiver or consent would reduce the principal of, or interest on, the Advances or
any fees or other amounts payable hereunder, in each case to the extent subject
to such participation, postpone any date fixed for any payment of principal of,
or interest on, the Advances or any fees or other amounts payable hereunder, in
each case to the extent subject to such participation, or release all or
substantially all of the Collateral.
(g) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower furnished to such Lender
Party by or on behalf of the Borrower.
(h) Notwithstanding any other provision set forth in this
Agreement, any Lender Party may at any time create a security interest in all or
any portion of its rights under this Agreement (including, without limitation,
the Advances owing to it and the Note or Notes held by it) in favor of any
Federal Reserve Bank in accordance with Regulation A of the Board of Governors
of the Federal Reserve System.
(i) The Issuing Bank may assign to an Eligible Assignee not
less than all of its rights and obligations under the undrawn portion of its
Letter of Credit Commitment at any time; PROVIDED, HOWEVER, that (i) each such
assignment shall be to an Eligible Assignee and (ii) the parties to each such
assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with a processing and recordation fee of $3,500.00.
76
(j) The Borrower assumes all risks of the acts or omissions of
any beneficiary or transferee of any Letter of Credit with respect to its use of
such Letter of Credit. None of the Issuing Bank or any Lender or any of their
respective officers or directors shall be liable or responsible for: (a) the use
that may be made of any Letter of Credit or any acts or omissions of any
beneficiary or transferee in connection therewith; (b) the validity, sufficiency
or genuineness of documents, or of any endorsement thereon, even if such
documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (c) payment by the Issuing Bank against presentation of
documents that do not comply with the terms of a Letter of Credit, including
failure of any documents to bear any reference or adequate reference to the
Letter of Credit; or (d) any other circumstances whatsoever in making or failing
to make payment under any Letter of Credit, except that the Borrower shall have
a claim against the Issuing Bank, and the Issuing Bank shall be liable to the
Borrower, to the extent of any direct, but not consequential, damages suffered
by the Borrower that the Borrower proves were caused by (i) the Issuing Bank's
willful misconduct or gross negligence as determined in a final, non-appealable
judgment by a court of competent jurisdiction in determining whether documents
presented under any Letter of Credit comply with the terms of the Letter of
Credit or (ii) the Issuing Bank's willful failure to make lawful payment under a
Letter of Credit after the presentation to it of a draft and certificates
strictly complying with the terms and conditions of the Letter of Credit. In
furtherance and not in limitation of the foregoing, the Issuing Bank may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary.
SECTION 8.08. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 8.09. JURISDICTION, ETC. (a) Each of the parties
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York state court or
federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or any of the other Loan Documents to which it is a
party, 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 any such
New York state court or, to the extent permitted by law, in such federal court.
Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that any party may otherwise have to bring any
action or proceeding relating to this Agreement or any of the other Loan
Documents in the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any of the
other Loan Documents to which it is a party in any New York state or federal
court. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.
SECTION 8.10. GOVERNING LAW. This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State of
New York.
SECTION 8.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO
IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY CLAIM, ACTION,
SUIT OR
77
PROCEEDING ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS OR THE MATTERS
CONTEMPLATED BY THIS AGREEMENT. EACH PARTY HEREBY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE FEDERAL AND NEW YORK COURTS LOCATED IN THE CITY OF NEW YORK
IN CONNECTION WITH ANY DISPUTE RELATED TO THIS AGREEMENT, THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR ANY MATTERS RELATED TO THIS AGREEMENT. IN THE
EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL
BY THE COURT.
ARTICLE IX
L/C CASH COLLATERAL ACCOUNT
SECTION 9.01. CASH COLLATERAL ACCOUNT. (a) GRANT OF SECURITY.
The Borrower hereby pledges to the Administrative Agent, as collateral agent for
the ratable benefit of the Secured Parties, and hereby grants to the
Administrative Agent, as collateral agent for the ratable benefit of the Secured
Parties, a security interest in, the Borrower's right, title and interest in and
to the L/C Cash Collateral Account and all (i) funds and financial assets from
time to time credited thereto (including, without limitation, all Cash
Equivalents), all interest, dividends, distributions, cash, instruments and
other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of such funds and financial assets,
and all certificates and instruments, if any, from time to time representing or
evidencing the L/C Cash Collateral Account, (ii) and all promissory notes,
certificates of deposit, deposit accounts, checks and other instruments from
time to time delivered to or otherwise possessed by the Administrative Agent, as
collateral agent for or on behalf of the Borrower, in substitution for or in
addition to any or all of the then existing L/C Account Collateral and (iii) all
interest, dividends, distributions, cash, instruments and other property from
time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the then existing L/C Account Collateral, in each of
the cases set forth in clauses (i), (ii) and (iii) above, whether now owned or
hereafter acquired by the Borrower, wherever located, and whether now or
hereafter existing or arising (all of the foregoing, collectively, the "L/C
ACCOUNT COLLATERAL").
(b) MAINTAINING THE L/C ACCOUNT COLLATERAL. So long as any
Advance or any other Obligation of any Loan Party under any Loan Document shall
remain unpaid, any Letter of Credit shall be outstanding, any secured Hedge
Agreement shall be in effect or any Lender Party shall have any Commitment:
(i) the Borrower will maintain all L/C Account Collateral only
with the Administrative Agent, as collateral agent; and
(ii) the Administrative Agent shall have sole right to direct
the disposition of funds with respect to the L/C Cash Collateral
Account subject to the provisions of this Agreement, and it shall be a
term and condition of such L/C Cash Collateral Account, that except as
otherwise provided herein, notwithstanding any term or condition to the
contrary in any other agreement relating to the L/C Cash Collateral
Account, as the case may be, that no amount (including, without
limitation, interest on Cash Equivalents credited thereto) will be paid
or released to or for the account of, or withdrawn by or for the
account of, the Borrower or any other Person from the L/C Cash
Collateral Account; and
(iii) the Administrative Agent may (with the consent of the
Required Lenders), at any time and without notice to, or consent from,
the Borrower, transfer, or direct the transfer of, funds from the L/C
Account Collateral to satisfy the Borrower's Obligations under the Loan
Documents if an Event of Default shall have occurred and be continuing.
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(c) INVESTING OF AMOUNTS IN THE L/C CASH COLLATERAL ACCOUNT.
The Administrative Agent will, from time to time invest (i)(A) amounts received
with respect to the L/C Cash Collateral Account in such Cash Equivalents
credited to the L/C Cash Collateral Account as the Borrower may select and the
Administrative Agent, as collateral agent, may approve in its reasonable
discretion, and (B) interest paid on the Cash Equivalents referred to in clause
(i)(A) above, and (ii) reinvest other proceeds of any such Cash Equivalents that
may mature or be sold, in each case in such Cash Equivalents credited in the
same manner. Interest and proceeds that are not invested or reinvested in Cash
Equivalents as provided above shall be deposited and held in the L/C Cash
Collateral Account. In addition, the Administrative Agent shall have the right
at any time to exchange such Cash Equivalents for similar Cash Equivalents of
smaller or larger determinations, or for other Cash Equivalents, credited to the
L/C Cash Collateral Account.
(d) RELEASE OF AMOUNTS. So long as no Default under the Credit
Agreement shall have occurred and be continuing, the Administrative Agent will
pay and release to the Borrower or at its order or, at the request of the
Borrower, to the Administrative Agent to be applied to the Obligations of the
Borrower under the Loan Documents such amount, if any, as is then on deposit in
the L/C Cash Collateral Account.
(e) REMEDIES. Upon the occurrence and during the continuance
of any Event of Default, in addition to the rights and remedies available
pursuant to Article VI hereof and under the other Collateral Documents, (i) the
Administrative Agent may exercise in respect of the L/C Account Collateral all
the rights and remedies of a secured party upon default under the UCC (whether
or not the UCC applies to the affected L/C Account Collateral), and (ii) the
Administrative Agent may, without notice to the Borrower, except as required by
law and at any time or from time to time, charge, set-off and otherwise apply
all or any part of the Obligations of the Borrower under the Loan Documents
against any funds held with respect to the L/C Account Collateral or in any
other deposit account.
[BALANCE OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
BOCA RESORTS HOTEL CORPORATION,
as Borrower
By: /s/ ▇▇▇▇▇ More
-------------------------------------
▇▇▇▇▇ ▇▇▇▇, Vice President
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
S-1
DEUTSCHE BANK TRUST COMPANY
AMERICAS, as Initial
Issuing Bank,
Administrative Agent and
Initial Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Vice President
S-2
FLEET NATIONAL BANK,
as Syndication Agent and Initial Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Director
S-3
THE BANK OF NOVA SCOTIA,
NEW YORK AGENCY,
as Documentation Agent and Initial Lender
By: /s/ ▇▇▇▇▇ ▇. Ferunson
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
S-4
BEAR ▇▇▇▇▇▇▇ CORPORATE LENDING INC.,
as Initial Lender
By:
-------------------------------------
Name:
Title:
S-5
COMERICA BANK,
as Initial Lender
By:
-------------------------------------
Name:
Title:
S-6
WACHOVIA BANK, N.A.,
as Initial Lender
By:
-------------------------------------
Name:
Title:
S-7
SOUTHTRUST BANK, an Alabama banking
corporation, as Initial Lender
By:
-------------------------------------
Name:
Title:
S-8