▇▇▇▇▇ II REALTY TRUST, INC.
CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of February 27, 1997 and
entered into by and among ▇▇▇▇▇ II REALTY TRUST, INC., a Maryland corporation
("Borrower"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF
(each individually referred to herein as a "Lender" and collectively as
"Lenders"), and BANKERS TRUST COMPANY ("Bankers"), as agent for Lenders (in such
capacity,
"Agent").
R E C I T A L S
WHEREAS, Borrower desires that Lenders extend certain credit
facilities to Borrower the proceeds of which will be used to finance a dividend
or other distributions to Apollo Real Estate Investment Fund II, L.P.; and
WHEREAS, Borrower desires to secure its obligations hereunder
by granting a perfected, first priority security interest in all of its
property, including without limitation all of the stock of ▇▇▇▇▇ Equity Inc.
owned by Borrower.
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, Borrower, Lenders and
Agent agree as follows:
Section 1. DEFINITIONS
1.1 Certain Defined Terms.
The following terms used in this Agreement shall have the
following meanings:
"Adjusted LIBOR Rate" means, for any Interest Rate
Determination Date with respect to an Interest Period for a LIBOR Rate Loan, the
rate per annum obtained by dividing (i) the offered quotation (rounded upward to
the nearest 1/16 of one percent) to first class banks in the London interbank
LIBOR market by Bankers for U.S. dollar deposits of amounts in same day funds
comparable to the principal amount of the LIBOR Rate Loan of Bankers for which
the Adjusted LIBOR Rate is then being determined with maturities comparable to
such Interest Period as of approximately 10:00 a.m. (New York time) on such
Interest Rate Determination Date by (ii) a percentage equal to 100% minus the
stated maximum rate of all reserve requirements (including any marginal,
emergency, supplemental, special or other
669235.2
reserves) applicable on such Interest Rate Determination Date to any member bank
of the Federal Reserve System in respect of "Eurocurrency liabilities" as
defined in Regulation D (or any successor category of liabilities under
Regulation D).
"Affected Lender" has the meaning assigned to that term in
subsection 2.6C.
"Affiliate", as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise.
"Agent" has the meaning assigned to that term in the
introduction to this Agreement and also means and includes any successor Agent
appointed pursuant to subsection 8.5.
"Agreement" means this Credit Agreement dated as of February
27, 1997 as it may be amended, supplemented or otherwise modified from time to
time.
"Apollo" means Apollo Real Estate Investment Fund II, L.P.
"Asset Sale" means the sale, transfer or other disposition by
Borrower to any Person of any assets (whether tangible or intangible) of
Borrower, including without limitation, any ▇▇▇▇▇ Common Stock or other
Collateral.
"Assignment Agreement" means an Assignment Agreement in
substantially the form of Exhibit VI annexed hereto.
"Average Collateral Market Value" means, as of any date of
determination, the product of (i) the number of shares of ▇▇▇▇▇ Common Stock
subject to a perfected, first priority security interest in favor of Agent as of
such date of determination multiplied by (ii) the Average Market Price of a
share of ▇▇▇▇▇ Common Stock.
"Average Market Price" means,*.
"Bankers" has the meaning assigned to that term in the
introduction to this Agreement.
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* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
"Bankruptcy Code" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any successor statute.
"Base Rate" means, at any time, the higher of (i) the Prime
Rate and (ii) the rate which is 1/2 of 1% in excess of the Federal Funds
Effective Rate.
"Base Rate Loans" means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection 2.2A.
"Borrower" has the meaning assigned to that term in the
introduction to this Agreement.
"Borrowing Base" means,*.
"Business Day" means any day excluding Saturday, Sunday and any
day which is a legal holiday under the laws of the State of New York or is a day
on which banking institu tions located in such state are authorized or required
by law or other governmental action to close.
"Cash Equivalents" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, the highest rating
obtainable from either Standard & Poor's Ratings Group ("S&P") or ▇▇▇▇▇'▇
Investors Service, Inc. ("Moody's"); (iii) commercial paper maturing no more
than one year from the date of creation thereof and having, at the time of the
acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Moody's; (iv) certificates of deposit or bankers' acceptances maturing within
one year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that (a) is at least "adequately
capitalized" (as defined in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100,000,000; and (v) shares of any money market mutual fund that (a)
has at least 95% of its assets invested continuously in the types of investments
referred to in clauses (i) and (ii) above, (b) has net assets of not less than
$500,000,000, and (c) has the highest rating obtainable from either S&P or
Moody's.
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* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
"Certificate re Non-Bank Status" means a certificate
substantially in the form of Exhibit VII annexed hereto delivered by a Lender to
Agent pursuant to subsection 2.7B(ii).
"Closing Date" means the date on or before February 28, 1997,
on which the Loans are made.
"Collateral" means, collectively, the ▇▇▇▇▇ Common Stock set
forth on Schedule I to the Pledge Agreement and all of the other property in
which Liens are purported to be granted pursuant to the Collateral Documents as
security for the Obligations.
"Collateral Documents" means the Pledge Agreement and all other
instruments or documents delivered by any Person pursuant to this Agreement or
any of the other Loan Documents in order to grant to Agent, on behalf of
Lenders, a Lien on any real, personal or mixed property of that Person as
security for the Obligations.
"Collateral Market Value" means,*.
"Commitment" means the commitment of a Lender to make a Loan to
Borrower pursuant to subsection 2.1A, and "Commitments" means such commitments
of all Lenders in the aggregate.
"Common Stock Rights Agreement" means,*.
"Common Stock Rights Agreement Amendment" means,*.
"Contingent Obligation", as applied to any Person, means any
direct or indirect liability, contingent or otherwise, of that Person (i) with
respect to any Indebtedness, lease, dividend or other obligation of another if
the primary purpose or intent thereof by the Person incurring the Contingent
Obligation is to provide assurance to the obligee of such obligation of another
that such obligation of another will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
obligation will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the account of
that Person or as to which that Person is otherwise liable for ▇▇▇▇ bursement of
drawings, or (iii) under interest rate agreements or currency agreements.
Contingent Obligations shall include (a) the direct or indirect guaranty,
endorsement (otherwise than for collection or deposit in the ordinary course of
business), co-making, discounting with recourse or sale with recourse by such
Person of the obligation of another, (b) the obligation to make take-or-pay or
similar payments if required regardless of non-performance by any other party or
parties to an agreement, and (c) any liability of such Person for the obligation
of another through any agreement (contingent or otherwise) (X) to purchase,
repurchase or
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* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
otherwise acquire such obligation or any security therefor, or to provide funds
for the payment or discharge of such obligation (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise) or (Y) to
maintain the solvency or any balance sheet item, level of income or financial
condition of another if, in the case of any agreement described under subclauses
(X) or (Y) of this sentence, the primary purpose or intent thereof is as de
scribed in the preceding sentence. The amount of any Contingent Obligation shall
be equal to the amount of the obligation so guaranteed or otherwise supported
or, if less, the amount to which such Contingent Obligation is specifically
limited.
"Dollars" and the sign "$" mean the lawful money of the United
States of America.
"Eligible Assignee" means (i) a commercial bank or investment
bank organized, or any subsidiary, bank or agency of a foreign commercial bank
or investment bank operating, under the laws of the United States of America or
any state thereof, and having total assets in excess of $1,000,000,000; (ii) a
savings and loan association or savings bank organized under the laws of the
United States of America, or any state thereof, and having total assets in
excess of $1,000,000,000 or (iii) a finance company, insurance company or other
financial institution organized under the laws of the United States of America,
or any state thereof, that is engaged in purchasing or otherwise investing in
commercial loans in the ordinary course of business, having total assets in
excess of $100,000,000; provided that no Affiliate of Borrower shall be an
Eligible Assignee.
"Employee Benefit Plan" means any "employee benefit plan" as
defined in Section 3(3) of ERISA which is or was maintained or contributed to by
Borrower or any of its ERISA Affiliates.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor thereto.
"ERISA Affiliate" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations within the
meaning of Section 414(b) of the Internal Revenue Code of which that Person is a
member; (ii) any trade or business (whether or not incorporated) which is a
member of a group of trades or businesses under common control within the
meaning of Section 414(c) of the Internal Revenue Code of which that Person is a
member; and (iii) any member of an affiliated service group within the meaning
of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any
corporation described in clause (i) above or any trade or business described in
clause (ii) above is a member. Any former ERISA Affiliate of Borrower shall
continue to be considered an ERISA Affiliate of Borrower within the meaning of
this definition with respect to the period such entity was an ERISA Affiliate of
Borrower and with respect to liabilities arising after such period for which
Borrower could be liable under the Internal Revenue Code or ERISA.
669235.2
"ERISA Event" means (i) a "reportable event" within the meaning
of Section 4043 of ERISA and the regulations issued thereunder with respect to
any Pension Plan (excluding those for which the provision for 30-day notice to
the PBGC has been waived by regulation); (ii) the failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code with respect to any
Pension Plan (whether or not waived in accordance with Section 412(d) of the
Internal Revenue Code) or the failure to make by its due date a required
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (iv) the
withdrawal by Borrower or any of its ERISA Affiliates from any Pension Plan with
two or more contributing sponsors or the termination of any such Pension Plan
resulting in liability pursuant to Section 4063 or 4064 of ERISA; (v) the
institution by the PBGC of proceedings to terminate any Pension Plan, or the
occurrence of any event or condition which might constitute grounds under ERISA
for the termination of, or the appointment of a trustee to administer, any
Pension Plan; (vi) the imposition of liability on Borrower or any of its ERISA
Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the
application of Section 4212(c) of ERISA; (vii) the withdrawal of Borrower or any
of its ERISA Affiliates in a complete or partial withdrawal (within the meaning
of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any
potential liability therefor, or the receipt by Borrower or any of its ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Borrower or any of its ERISA Affiliates of fines, penalties, taxes or related
charges under Chapter 43 of the Internal Revenue Code or under Section 409,
Section 502(c), (i) or (l), or Section 4071 of ERISA in respect of any Employee
Benefit Plan; (ix) the assertion of a material claim (other than routine claims
for benefits) against any Employee Benefit Plan other than a Multiemployer Plan
or the assets thereof, or against Borrower or any of its ERISA Affiliates in
connection with any Employee Benefit Plan; (x) receipt from the Internal Revenue
Service of notice of the failure of any Pension Plan (or any other Employee
Benefit Plan intended to be qualified under Section 401(a) of the Internal
Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or
the failure of any trust forming part of any Pension Plan to qualify for
exemption from taxation under Section 501(a) of the Internal Revenue Code; or
(xi) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan.
"Event of Default" means each of the events set forth in
Section 7.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
"FBCA" means the Florida Business Corporation Act, as amended
and in effect from time to time.
669235.2
"Federal Funds Effective 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 of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by Agent from three Federal funds brokers of
recognized standing selected by Agent.
"Fiscal Quarter" means a fiscal quarter of any Fiscal Year.
"Fiscal Year" means the fiscal year of Borrower ending on
December 31 of each calendar year.
"Funding and Payment Office" means (i) the office of Agent
located at One Bankers Trust Plaza, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
or (ii) such other office of Agent as may hereafter be designated from time to
time in a written notice delivered by Agent to Borrower and each Lender.
"Funding Date" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application
thereof set forth in subsection 1.2, generally accepted accounting principles
set forth in opinions and pro nouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, in each case as the same are applicable to the
circumstances as of the date of determination.
"Governmental Authorization" means any permit, license,
authorization, plan, directive, consent order or consent decree of or from any
federal, state or local governmental authority, agency or court.
"Indebtedness", as applied to any Person, means (i) all
indebtedness for borrowed money, (ii) that portion of obligations with respect
to capital leases that is properly classified as a liability on a balance sheet
in conformity with GAAP, (iii) notes payable and drafts accepted representing
extensions of credit whether or not representing obligations for borrowed money,
(iv) any obligation owed for all or any part of the deferred purchase price of
property or services (excluding any such obligations incurred under ERISA),
which purchase price is (a) due more than six months from the date of incurrence
of the obligation in respect thereof or (b) evidenced by a note or similar
written instrument, and (v) all indebted ness secured by any Lien on any
property or asset owned or held by that Person regardless of whether the
indebtedness secured thereby shall have been assumed by that Person or is
nonrecourse to the credit of that Person.
669235.2
"Indemnitee" has the meaning assigned to that term in
subsection 9.3.
"Interest Payment Date" means the first day of each calendar
month, commencing April 1, 1997.
"Interest Period" has the meaning assigned to that term in
subsection 2.2B.
"Interest Rate Determination Date" means, with respect to any
Interest Period, the second Business Day immediately prior to the first day of
such Interest Period.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended to the date hereof and from time to time hereafter, and any
successor statute.
"Investment" means (i) any direct or indirect purchase or other
acquisition by Borrower of, or of a beneficial interest in, any Securities of
any other Person, (ii) any direct or indirect loan, advance (other than advances
to employees for moving, entertainment and travel expenses, drawing accounts and
similar expenditures in the ordinary course of business) or (iii) capital
contribution by Borrower to any other Person, including all indebtedness and
accounts receivable from that other Person that are not current assets or did
not arise from sales to that other Person in the ordinary course of business.
The amount of any Investment shall be the original cost of such Investment plus
the cost of all additions thereto, without any adjust ments for increases or
decreases in value, or write-ups, write-downs or write-offs with respect to such
Investment.
"▇▇▇▇▇" means ▇▇▇▇▇ Equity Inc., a Florida corporation.
"▇▇▇▇▇ Articles of Incorporation" means the Amended and
Restated Articles of Incorporation of ▇▇▇▇▇ Equity, Inc. filed with the
Secretary of State of Florida on May 19, 1994, as such articles may be amended,
supplemented or otherwise modified to the extent permitted herein.
"▇▇▇▇▇ Common Stock" means the common stock of ▇▇▇▇▇, par value
$.01 per share.
"Lender" and "Lenders" means the persons identified as
"Lenders" and listed on the signature pages of this Agreement, together with
their successors and permitted assigns pursuant to subsection 9.1.
"LIBOR Rate Loans" means Loans bearing interest at rates
determined by reference to the Adjusted LIBOR Rate as provided in subsection
2.2A.
"Lien" means any lien, mortgage, pledge, assignment, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement,
669235.2
any lease in the nature thereof, and any agreement to give any security
interest) and any option, trust or other preferential arrangement having the
practical effect of any of the foregoing.
"Loan Documents" means this Agreement, the Collateral Documents
and the Notes.
"Loan Exposure" means, with respect to any Lender as of any
date of determination, (i) prior to the termination of the Commitments, that
Lender's Commitment and (ii) after the termination of the Commitments, the
outstanding principal amount of the Loan of that Lender.
"Loans" means the Loans made by Lenders to Borrower pursuant to
subsection 2.1A.
"Margin Stock" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System as in
effect from time to time.
"Market Price" means,*.
"Material Adverse Effect" means (i) a material adverse effect
upon the assets or condition (financial or otherwise) of Borrower or (ii) the
impairment of the ability of Borrower to perform, or the enforceability of, the
Obligations.
"Maturity Date" means February 28, 1999.
"Multiemployer Plan" means any Employee Benefit Plan which is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"Notes" means (i) the promissory notes of Borrower issued
pursuant to subsection 2.1 on the Closing Date and (ii) any promissory notes
issued by Borrower pursuant to the last sentence of subsection 9.1B(i) in
connection with assignments of the Commitments or Loans of any Lenders, in each
case substantially in the form of Exhibit III annexed hereto, as they may be
amended, supplemented or otherwise modified from time to time.
"Notice of Borrowing" means a notice substantially in the form
of Exhibit I annexed hereto delivered by Borrower to Agent pursuant to
subsection 2.1B with respect to a proposed borrowing.
"Notice of Continuation" means a notice substantially in the
form of Exhibit II annexed hereto delivered by Borrower to Agent pursuant to
subsection 2.2D with respect to
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* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
a proposed conversion or continuation of the applicable basis for determining
the interest rate with respect to the Loans specified therein.
"Obligations" means all obligations of every nature of Borrower
from time to time owed to Agent, Lenders or any of them under the Loan
Documents, whether for principal, interest, fees, expenses, indemnification or
otherwise.
"Officers' Certificate" means, as applied to any corporation, a
certificate executed on behalf of such corporation by its chairman of the board
(if an officer) or its president or one of its vice presidents and by its chief
financial officer or its treasurer; provided that every Officers' Certificate
with respect to the compliance with a condition precedent to the making of the
Loans hereunder shall include (i) a statement that the officer or officers
making or giving such Officers' Certificate have read such condition and any
definitions or other provisions contained in this Agreement relating thereto,
(ii) a statement that, in the opinion of the signers, they have made or have
caused to be made such examination or investigation as is necessary to enable
them to express an informed opinion as to whether or not such condition has been
complied with, and (iii) a statement as to whether, in the opinion of the
signers, such condition has been complied with.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
"Permitted Encumbrances" means the following types of Liens
(excluding any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or by ERISA and any such Lien relating to or imposed in
connection with any Environmental Claim):
(i) Liens for taxes, assessments or governmental charges or
claims the payment of which is not, at the time, required by subsection
5.3;
(ii) any attachment or judgment Lien not constituting an Event
of Default under subsection 7.8; and
(iii) Liens arising from filing UCC financing statements
relating solely to leases permitted by this Agreement.
"Person" means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, joint ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments (whether
669235.2
federal, state or local, domestic or foreign, and including political
subdivisions thereof) and agencies or other administrative or regulatory bodies
thereof.
"Pledge Agreement" means the Pledge and Security Agreement
executed and delivered by Borrower on the Closing Date, substantially in the
form of Exhibit VIII annexed hereto, as such Borrower Pledge Agreement may
thereafter be amended, supplemented or otherwise modified from time to time.
"Potential Event of Default" means a condition or event that,
after notice or lapse of time or both, would constitute an Event of Default.
"Prime Rate" means the rate that Bankers announces from time to
time as its prime lending rate, as in effect from time to time. The Prime Rate
is a reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. Bankers or any other Lender may make
commercial loans or other loans at rates of interest at, above or below the
Prime Rate.
"Pro Rata Share" means, with respect to each Lender, the
percentage obtained by dividing (x) the Loan Exposure of that Lender by (y) the
aggregate Loan Exposure of all Lenders, as such percentage may be adjusted by
assignments permitted pursuant to subsection 9.1. The initial Pro Rata Share of
each Lender is set forth opposite the name of that Lender in Schedule 2.1
annexed hereto.
"Register" has the meaning assigned to that term in subsection
2.1D.
"Registration Rights Agreement" means,*.
"Related Agreements" means,*.
"Requisite Lenders" means Lenders having or holding more than
50% of the aggregate Loan Exposure of all Lenders.
"Restricted Junior Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of stock
of Borrower now or hereafter outstanding, except a dividend payable solely in
shares of that class of stock to the holders of that class, (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of stock of Borrower now
or hereafter outstanding, (iii) any payment made to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights to acquire
shares of any class of stock of Borrower now or hereafter outstanding and (iv)
any payment or prepayment of principal of,
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* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
premium (if any), or interest on, or redemption, purchase, retirement,
defeasance, sinking fund or similar payment with respect to any Indebtedness
subordinated to the Obligations.
"Securities" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, and any successor statute.
"Solvent" means, with respect to any Person, that as of the
date of determination both (A) (i) the then fair saleable value of the property
of such Person is (y) greater than the total amount of liabilities (including
contingent liabilities) of such Person and (z) not less than the amount that
will be required to pay the probable liabilities on such Person's then existing
debts as they become absolute and matured considering all financing alternatives
and potential asset sales reasonably available to such Person; (ii) such
Person's capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (iii) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (B) such Person is
"solvent" within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
"Stock Purchase Agreement" means,*.
"Subsidiary" means, with respect to any Person, any
corporation, partnership, limited liability company, association, joint venture
or other business entity of which more than 50% of the total voting power of
shares of stock or other ownership interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Person or Persons
(whether directors, managers, trustees or other Persons performing similar
functions) having the power to direct or cause the direction of the management
and policies thereof is at the time owned or controlled, directly or indirectly,
by that Person or one or more of the other Subsidiaries of that Person or a
combination thereof.
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* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
"Tax" or "Taxes" means any present or future tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature and whatever called,
by whomsoever, on whomsoever and wherever imposed, levied, collected, withheld
or assessed; provided that "Tax on the overall net income" of a Person shall be
construed as a reference to a tax imposed by the jurisdiction in which that
Person is organized or in which that Person's principal office (and/or, in the
case of a Lender, its lending office) is located or in which that Person
(and/or, in the case of a Lender, its lending office) is deemed to be doing
business on all or part of the net income, profits or gains (whether worldwide,
or only insofar as such income, profits or gains are considered to arise in or
to relate to a particular jurisdiction, or otherwise) of that Person (and/or, in
the case of a Lender, its lending office).
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement.
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Borrower to Lenders pursuant to clauses (i) and (ii)
of subsection 5.1 shall be prepared in accordance with GAAP as in effect at the
time of such preparation (and delivered together with the reconciliation
statements provided for in subsection 5.1(iv)). Calculations in connection with
the definitions, covenants and other provisions of this Agreement shall utilize
accounting principles and policies in conformity with those used to prepare the
financial statements referred to in subsection 4.3.
1.3 Other Definitional Provisions and Rules of Construction.
A. Any of the terms defined herein may, unless the context
otherwise requires, be used in the singular or the plural, depending on the
reference.
B. References to "Sections" and "subsections" shall be to
Sections and subsections, respectively, of this Agreement unless otherwise
specifically provided.
C. The use in any of the Loan Documents of the word "include"
or "including", when following any general statement, term or matter, shall not
be construed to limit such statement, term or matter to the specific items or
matters set forth immediately following such word or to similar items or
matters, whether or not nonlimiting language (such as "without limitation" or
"but not limited to" or words of similar import) is used with reference thereto,
but rather shall be deemed to refer to all other items or matters that fall
within the broadest possible scope of such general statement, term or matter.
669235.2
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 Commitments; Making of Loans; the Register; Notes.
A. Commitments. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of Borrower
herein set forth, each Lender hereby severally agrees to lend to Borrower, on
the Closing Date, an amount not exceeding its Pro Rata Share of the lesser of
(i) the aggregate amount of the Commitments and (ii) the product of (a) the
Collateral Market Value as of the Closing Date multiplied by (b) __%*, to be
used for the purposes identified in subsection 2.5A. In addition, from time to
time during the period from the Closing Date to but excluding the Maturity Date,
each Lender hereby severally agrees to lend to Borrower its Pro Rata Share of
additional Loans; provided that (i) after giving effect to the Loans to be made
on any proposed Funding Date (other than the Closing Date), the aggregate
principal amount of Loans outstanding shall not exceed the product of (a) the
Average Collateral Market Value as of such proposed Funding Date multiplied by
(b) __%* and (ii) in no event shall the aggregate amount of Loans made (whether
or not such Loans have been prepaid) exceed the aggregate amount of the
Commitments. The amount of each Lender's Commitment is set forth opposite its
name on Schedule 2.1 annexed hereto and the aggregate amount of the Commitments
is $________*; provided that the Commitments of Lenders shall be adjusted to
give effect to any assignments of the Commitments pursuant to subsection 9.1B.
Borrower may make only one borrowing under the Commitments during any 30
consecutive-day period. Amounts borrowed under this subsection 2.1A and
subsequently repaid or prepaid may not be reborrowed.
B. Borrowing Mechanics. Loans made as LIBOR Rate Loans with a
particular Interest Period shall be in an aggregate minimum amount of $500,000.
Whenever Borrower desires that Lenders make the Loans it shall deliver to Agent
a Notice of Borrowing no later than 10:00 A.M. (New York City time) at least
three Business Days in advance of the proposed Funding Date. The Notice of
Borrowing shall specify (i) the proposed Funding Date (which shall be a Business
Day), (ii) the amount of Loans requested and (iii) the requested Interest Period
which shall be a one, two or three-month period. Loans may be continued as or
converted into LIBOR Rate Loans in the manner provided in subsection 2.2D.
Except as otherwise provided in subsections 2.6B, 2.6C and
2.6G, a Notice of Borrowing for a LIBOR Rate Loan shall be irrevocable on and
after the related Interest Rate Determination Date, and Borrower shall be bound
to make a borrowing in accordance therewith.
C. Disbursement of Funds. The Loans shall be made by Lenders
simultaneously and proportionately to their respective Pro Rata Shares, it being
understood that
--------
* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
no Lender shall be responsible for any default by any other Lender in that other
Lender's obligation to make a Loan requested hereunder nor shall the Commitment
of any Lender be increased or decreased, or any Lender's obligation to make a
Loan hereunder affected, as a result of a default by any other Lender in that
other Lender's obligation to make a Loan requested hereunder. Promptly after
receipt by Agent of a Notice of Borrowing pursuant to subsection 2.1B (or
telephonic notice in lieu thereof), Agent shall notify each Lender of the
proposed borrowing. Each Lender shall make the amount of its Loan available to
Agent, in same day funds in Dollars, at the Funding and Payment Office, not
later than 12:00 Noon (New York City time) on the Closing Date or other Funding
Date, as applicable. Upon satisfaction or waiver of the conditions precedent
specified in Section 3, Agent shall make the proceeds of such Loans available to
Borrower on the Closing Date or other Funding Date, as applicable, by causing an
amount of same day funds in Dollars equal to the proceeds of all such Loans
received by Agent from Lenders to be credited to the account of Borrower at the
Funding and Payment Office.
Unless Agent shall have been notified by any Lender prior to
the Funding Date that such Lender does not intend to make available to Agent the
amount of such Lender's Loan requested on such Funding Date, Agent may assume
that such Lender has made such amount available to Agent on such Funding Date
and Agent may, in its sole discretion, but shall not be obligated to, make
available to Borrower a corresponding amount on such Funding Date. If such
corresponding amount is not in fact made available to Agent by such Lender,
Agent shall be entitled to recover such corresponding amount on demand from such
Lender together with interest thereon, for each day from such Funding Date until
the date such amount is paid to Agent, at the customary rate set by Agent for
the correction of errors among banks for three Business Days and thereafter at
the Base Rate. If such Lender does not pay such corresponding amount forthwith
upon Agent's demand therefor, Agent shall promptly notify Borrower and Borrower
shall immediately pay such corresponding amount to Agent together with interest
thereon, for each day from such Funding Date until the date such amount is paid
to Agent, at the rate payable under this Agreement for Base Rate Loans. Nothing
in this subsection 2.1C shall be deemed to relieve any Lender from its
obligation to fulfill its Commitment hereunder or to prejudice any rights that
Borrower may have against any Lender as a result of any default by such Lender
hereunder.
D. The Register.
(i) Agent shall maintain, at its address referred to in
subsection 9.8, a register for the recordation of the names and
addresses of Lenders and the Commitment and Loan of each Lender from
time to time (the "Register"). The Register shall be available for
inspection by Borrower or any Lender at any reasonable time and from
time to time upon reasonable prior notice.
(ii) Agent shall record in the Register the Commitment and the
Loan from time to time of each Lender and each repayment or prepayment
in respect of the principal amount of the Loan of each Lender. Any such
recordation shall be conclusive
669235.2
and binding on Borrower and each Lender, absent manifest error;
provided that failure to make any such recordation, or any error in
such recordation, shall not affect any Lender's Commitment or
Borrower's Obligations in respect of any applicable Loan.
(iii) Each Lender shall record on its internal records
(including the Note held by such Lender) the amount of the Loan made by
it and each payment in respect thereof. Any such recordation shall be
conclusive and binding on Borrower, absent manifest error; provided
that failure to make any such recordation, or any error in such
recordation, shall not affect any Lender's Commitment or Borrower's
Obligations in respect of any applicable Loan; and provided, further
that in the event of any inconsistency between the Register and any
Lender's records, the recordations in the Register shall govern.
(iv) Borrower, Agent and Lenders shall deem and treat the
Persons listed as Lenders in the Register as the holders and owners of
the corresponding Commitments and Loans listed therein for all purposes
hereof, and no assignment or transfer of any such Commitment or Loan
shall be effective, in each case unless and until an Assignment
Agreement effecting the assignment or transfer thereof shall have been
accepted by Agent and recorded in the Register as provided in
subsection 9.1B(ii). Prior to such recordation, all amounts owed with
respect to the applicable Commitment or Loan shall be owed to the
Lender listed in the Register as the owner thereof, and any request,
authority or consent of any Person who, at the time of making such
request or giving such authority or consent, is listed in the Register
as a Lender shall be conclusive and binding on any subsequent holder,
assignee or transferee of the corresponding Commitment or Loan.
E. Notes. Borrower shall execute and deliver to each Lender (or
to Agent for that Lender) on the Closing Date a Note substantially in the form
of Exhibit III annexed hereto to evidence that Lender's Loan, in the principal
amount of that Lender's Loan and with other appropriate insertions.
2.2 Interest on the Loans.
A. Rate of Interest. Subject to the provisions of subsections,
2.2E, 2.6 and 2.7, each Loan shall bear interest on the unpaid principal amount
thereof from the date made through maturity (whether by acceleration or
otherwise) as follows:
(i) if a Base Rate Loan, then at the Base Rate per annum; or
669235.2
(ii) if a LIBOR Rate Loan, then at the sum of the Adjusted
LIBOR Rate plus __%* per annum.
B. Interest Periods. The interest period (each an "Interest
Period") to be applicable to each LIBOR Rate Loan shall be a one, two or
three-month period; provided that:
(i) the initial Interest Period for any LIBOR Rate Loan shall
commence on the applicable Funding Date, in the case of a Loan
initially made as a LIBOR Rate Loan, or on the date specified in the
applicable Notice of Continuation, in the case of a Loan converted to a
LIBOR Rate Loan;
(ii) in the case of immediately successive Interest Periods
applicable to a LIBOR Rate Loan continued as such pursuant to a Notice
of Continuation, each successive Interest Period shall commence on the
day on which the next preceding Interest Period expires;
(iii) if an Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day
of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
(iv) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (v) of this subsection 2.2B, end on
the last Business Day of a calendar month;
(v) no Interest Period with respect to any portion of the Loans
shall extend beyond the Maturity Date; and
(vi) there shall be no more than three (3) Interest Periods
outstanding at any time.
C. Interest Payments. Subject to the provisions of subsection
2.2E, interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity).
--------
* Material omitted pursuant to a request for Confidential Treatment
and filed separately with the Commission.
669235.2
D. Continuation. Subject to the provisions of subsection 2.6,
Borrower shall, upon the expiration of any Interest Period applicable to a LIBOR
Rate Loan, continue all or any portion of such Loan as a LIBOR Rate Loan.
Borrower shall deliver a Notice of Continuation to Agent no
later than 10:00 A.M. (New York City time) at least three Business Days in
advance of the proposed contin uation date. A Notice of Continuation shall
specify (i) the proposed continuation date (which shall be a Business Day), (ii)
the amount and type of the Loan to be continued, (iii) the requested Interest
Period, which shall be a one, two or three-month period, and (iv) that no
Potential Event of Default or Event of Default has occurred and is continuing.
Upon receipt of written notice of any proposed continuation under this
subsection 2.2D, Agent shall promptly transmit such notice by telefacsimile to
each Lender. Notwithstanding anything to the contrary contained in this
subsection 2.2D, but provided that no Potential Event of Default or Event of
Default has occurred and is continuing, if Borrower fails to deliver a Notice of
Continuation by 10:00 A.M. (New York City time) at least three Business Days in
advance of the expiration of any Interest Period, Borrower shall be deemed to
have (i) delivered a Notice of Continuation with respect to the applicable LIBOR
Rate Loan with a requested Interest Period the same as the expiring Interest
Period and (ii) to have represented that no Potential Event of Default or Event
of Default has occurred and is continuing.
Except as otherwise provided in subsections 2.6B, 2.6C and
2.6G, a Notice of Continuation for continuation of a LIBOR Rate Loan (or
telephonic notice in lieu thereof) shall be irrevocable on and after the related
Interest Rate Determination Date, and Borrower shall be bound to effect a
conversion or continuation in accordance therewith.
E. Default Rate. Upon the occurrence and during the
continuation of any Event of Default, the outstanding principal amount of all
Loans and, to the extent permitted by applicable law, any interest payments
thereon not paid when due and any fees and other amounts then due and payable
hereunder, shall thereafter bear interest (including post-petition interest in
any proceeding under the Bankruptcy Code or other applicable bankruptcy laws)
payable upon demand at a rate that is 2% per annum in excess of the interest
rate otherwise payable under this Agreement with respect to the applicable Loans
(or, in the case of any such fees and other amounts, at a rate which is 2% per
annum in excess of the interest rate otherwise payable under this Agreement for
Base Rate Loans); provided that, in the case of LIBOR Rate Loans, upon the
expiration of the Interest Period in effect at the time any such increase in
interest rate is effective such LIBOR Rate Loans shall thereupon become Base
Rate Loans and shall thereafter bear interest payable upon demand at a rate
which is 2% per annum in excess of the interest rate otherwise payable under
this Agreement for Base Rate Loans. Payment or acceptance of the increased rates
of interest provided for in this subsection 2.2E is not a permitted alternative
to timely payment and shall not constitute a waiver of any Event of Default or
otherwise prejudice or limit any rights or remedies of Agent or any Lender.
F. Computation of Interest. Interest on the Loans shall be
computed on the basis of a 360-day year, in each case for the actual number of
days elapsed in the period
669235.2
during which it accrues. In computing interest on any Loan, the date of the
making of such Loan or the first day of an Interest Period applicable to such
Loan shall be included, and the date of payment of such Loan or the expiration
date of an Interest Period applicable to such Loan shall be excluded; provided
that if a Loan is repaid on the same day on which it is made, one day's interest
shall be paid on that Loan.
2.3 Fees.
A. Facility Fees. Borrower agrees to pay to Agent, on the
Closing Date, for distribution to each Lender in proportion to that Lender's Pro
Rata Share, facility fees in the aggregate amount of $________.*
B. Other Fees. Borrower agrees to pay such other fees in the
amounts and at the times separately agreed upon between Borrower and Agent or
any Lender.
2.4 Repayments and Prepayments; General Provisions Regarding Payments.
A. Scheduled Maturity of Loans. The Loans and all other amounts
owed hereunder with respect to the Loans shall be paid in full no later than the
Maturity Date.
B. Prepayments.
(i) Voluntary Prepayments. Borrower may, upon not less than
three Business Days' prior written or telephonic notice, given to Agent
by 12:00 Noon (New York City time) on the date such notice is required
to be given and, if given by telephone, promptly confirmed in writing
to Agent (which original written or telephonic notice Agent will
promptly transmit by telefacsimile or telephone to each Lender), at any
time and from time to time, without premium or penalty, prepay any
Loans on any Business Day in whole or in part in an aggregate minimum
amount of $100,000; provided, however, that upon prepayment of a LIBOR
Rate Loan on any date other than the expiration of the Interest Period
applicable thereto, Borrower shall pay all amounts due pursuant to
subsection 2.6.D. Notice of prepayment having been given as afore said,
the principal amount of the Loans specified in such notice shall become
due and payable on the prepayment date specified therein. Any such
voluntary prepayment shall be applied as specified in subsection
2.4B(iii).
(ii) Mandatory Prepayments. The Loans shall be prepaid in the
amounts and under the circumstances set forth below, all such
prepayments to be applied as set forth below or as more specifically
provided in subsection 2.4B(iii):
--------
* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
(a) Prepayments Upon Asset Sales. Concurrently with
the receipt of any proceeds from an Asset Sale, Borrower shall
prepay the Loans in an amount equal to the amount by which the
aggregate principal amount of outstanding Loans on the
applicable date of determination exceeds the product of (y) the
Average Collateral Market Value as of the applicable date of
determination multiplied by (z) __%*.
(b) Prepayments Due to Borrowing Base Limitations. If
at any time the aggregate principal amount of the outstanding
Loans exceeds the product of (1) the then applicable Collateral
Market Value multiplied by (2) __%,* then within two next
Business Days, Borrower shall prepay the Loans in an amount
equal to the amount by which the aggregate principal amount of
the outstanding Loans on the applicable date of determination
exceeds the product of (y) the Collateral Market Value on the
applicable date of determination multiplied by (z) __%.*
(iii) Application of Prepayments.
Any prepayment of the Loans shall be applied first to Base Rate
Loans to the full extent thereof before application to LIBOR Rate
Loans, in each case in a manner which minimizes the amount of any
payments required to be made by Borrower pursuant to subsection 2.6D.
C. General Provisions Regarding Payments.
(i) Manner and Time of Payment. All payments by Borrower of
principal, interest, fees and other Obligations hereunder and under the
Notes shall be made in Dollars in same day funds, without defense,
setoff or counterclaim, free of any restriction or condition, and
delivered to Agent not later than 12:00 Noon (New York City time) on
the date due at the Funding and Payment Office for the account of
Lenders; funds received by Agent after that time on such due date shall
be deemed to have been paid by Borrower on the next succeeding Business
Day. Borrower hereby authorizes Agent to charge its accounts with Agent
in order to cause timely payment to be made to Agent of all principal,
interest, fees and expenses due hereunder (subject to sufficient funds
being available in its accounts for that purpose).
(ii) Application of Payments to Principal and Interest. All
payments in respect of the principal amount of any Loan shall include
payment of accrued interest on the principal amount being repaid or
prepaid, and all such payments shall be applied to the payment of
interest before application to principal.
--------
* Material omitted pursuant to a request for Confidential
Treatment and filed separately with the Commission.
669235.2
(iii) Apportionment of Payments. Aggregate principal and
interest payments shall be apportioned among all outstanding Loans to
which such payments relate, in each case proportionately to Lenders'
respective Pro Rata Shares. Agent shall promptly distribute to each
Lender, at its primary address set forth below its name on the
appropriate signature page hereof or at such other address as such
Lender may request, its Pro Rata Share of all such payments received by
Agent. Notwithstanding the foregoing provisions of this subsection
2.4C(iii), if, pursuant to the provisions of subsection 2.6C, any
Notice of Continuation is withdrawn as to any Affected Lender or if any
Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of
any LIBOR Rate Loans, Agent shall give effect thereto in apportioning
payments received thereafter.
(iv) Payments on Business Days. Whenever any payment to be made
hereunder shall be stated to be due on a day that is not a Business
Day, such payment shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the
payment of interest hereunder.
(v) Notation of Payment. Each Lender agrees that before
disposing of the Note held by it, or any part thereof (other than by
granting participations therein), that Lender will make a notation
thereon of the Loan evidenced by that Note and all principal payments
previously made thereon and of the date to which interest thereon has
been paid; provided that the failure to make (or any error in the
making of) a notation of the Loan made under such Note shall not limit
or otherwise affect the obligations of Borrower hereunder or under such
Note with respect to such Loan or any payments of principal or interest
on such Note.
2.5 Use of Proceeds.
A. Loans. The proceeds of the Loans shall be applied by
Borrower to make a dividend or other distributions or payments to Apollo.
B. Margin Regulations. No portion of the proceeds of any
borrowing under this Agreement shall be used by Borrower or any of its
Subsidiaries in any manner that might cause the borrowing or the application of
such proceeds to violate Regulation G, Regulation U, Regulation T or Regulation
X of the Board of Governors of the Federal Reserve System or any other
regulation of such Board or to violate the Exchange Act, in each case as in
effect on the date or dates of such borrowing and such use of proceeds.
2.6 Special Provisions Governing LIBOR Rate Loans.
Notwithstanding any other provision of this Agreement to the
contrary, the following provisions shall govern with respect to LIBOR Rate Loans
as to the matters covered:
669235.2
A. Determination of Applicable Interest Rate. As soon as
practicable after 10:00 A.M. (New York City time) on each Interest Rate
Determination Date, Agent shall determine (which determination shall, absent
manifest error, be final, conclusive and binding upon all parties) the interest
rate that shall apply to the LIBOR Rate Loans for which an interest rate is then
being determined for the applicable Interest Period and shall promptly give
notice thereof (in writing or by telephone confirmed in writing) to Borrower and
each Lender.
B. Inability to Determine Applicable Interest Rate. In the
event that Agent shall have determined (which determination shall be final and
conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any LIBOR Rate Loans, that by reason of
circumstances affecting the interbank LIBOR market adequate and fair means do
not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted LIBOR Rate, Agent shall on such
date give notice (by telefacsimile or by telephone confirmed in writing) to
Borrower and each Lender of such determination, whereupon (i) no Loans may be
made as, or converted to, LIBOR Rate Loans until such time as Agent notifies
Borrower and Lenders that the circumstances giving rise to such notice no longer
exist and (ii) with respect to any Notice of Borrowing or Notice of Continuation
given by Borrower in connection with the Loans in respect of which such
determination was made, Borrower shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice of
Continuation as to all Lenders by giving notice (by telefacsimile or by
telephone confirmed in writing) to Agent of such rescission on the date on which
Agent gives notice of such determination as described above; provided that if no
such notice of rescission is given by Borrower, such Notice of Borrowing or
Notice of Continuation, shall be deemed to be a request to borrow, or to convert
LIBOR Rate Loans to, Base Rate Loans.
C. Illegality or Impracticability of LIBOR Rate Loans. In the
event that on any date any Lender shall have determined (which determination
shall be final and conclusive and binding upon all parties hereto but shall be
made only after consultation with Borrower and Agent) that the making,
maintaining or continuation of its LIBOR Rate Loans (i) has become unlawful as a
result of compliance by such Lender in good faith with any law, treaty,
governmental rule, regulation, guideline or order (or would conflict with any
such treaty, governmental rule, regulation, guideline or order not having the
force of law even though the failure to comply therewith would not be unlawful)
or (ii) has become impracticable, or would cause such Lender material hardship,
as a result of contingencies occurring after the date of this Agreement which
materially and adversely affect the interbank LIBOR market or the position of
such Lender in that market, then, and in any such event, such Lender shall be an
"Affected Lender" and it shall on that day give notice (by telefacsimile or by
telephone confirmed in writing) to Borrower and Agent of such determination
(which notice Agent shall promptly transmit to each other Lender). Thereafter
(a) the obligation of the Affected Lender to make Loans as, or to convert Loans
to, LIBOR Rate Loans shall be suspended until such notice shall be withdrawn by
the Affected Lender, (b) to the extent such determination by the Affected Lender
relates to a LIBOR Rate Loan then being requested by Borrower pursuant to a
Notice of Borrowing or a Notice of Continuation, the Affected Lender
669235.2
shall make such Loan as (or convert such Loan to, as the case may be) a Base
Rate Loan, (c) the Affected Lender's obligation to maintain its outstanding
LIBOR Rate Loans (the "Affected Loans") shall be terminated at the earlier to
occur of the expiration of the Interest Period then in effect with respect to
the Affected Loans or when required by law, and (d) the Affected Loans shall
automatically convert into Base Rate Loans on the date of such termination.
Notwithstanding the foregoing, to the extent a determination by an Affected
Lender as described above relates to a LIBOR Rate Loan then being requested by
Borrower pursuant to a Notice of Borrowing or a Notice of Continuation, Borrower
shall have the option, subject to the provisions of subsection 2.6D, to rescind
such Notice of Borrowing or Notice of Continuation as to all Lenders by giving
notice (by telefacsimile or by telephone confirmed in writing) to Agent of such
rescission on the date on which the Affected Lender gives notice of its
determination as described above (which notice of rescission Agent shall
promptly transmit to each other Lender). Except as provided in the immediately
preceding sentence, nothing in this subsection 2.6C shall affect the obligation
of any Lender other than an Affected Lender to make or maintain Loans as, or to
convert Loans to, LIBOR Rate Loans in accordance with the terms of this
Agreement.
D. Compensation For Breakage or Non-Commencement of Interest
Periods. Borrower shall compensate each Lender, upon written request by that
Lender (which request shall set forth the basis for requesting such amounts),
for all reasonable losses, expenses and liabilities (including any interest paid
by that Lender to lenders of funds borrowed by it to make or carry its LIBOR
Rate Loans and any loss, expense or liability sustained by that Lender in
connection with the liquidation or re-employment of such funds) which that
Lender may sustain: (i) if for any reason (other than a default by that Lender)
a borrowing of any LIBOR Rate Loan does not occur on a date specified therefor
in a Notice of Borrowing or a telephonic request for borrowing, or a conversion
to or continuation of any LIBOR Rate Loan does not occur on a date specified
therefor in a Notice of Continuation or a telephonic request for continuation,
(ii) if any prepayment (including any prepayment pursuant to subsection 2.4B(i))
or other principal payment or any conversion of any of its LIBOR Rate Loans
occurs on a date prior to the last day of an Interest Period applicable to that
Loan, (iii) if any prepayment of any of its LIBOR Rate Loans is not made on any
date specified in a notice of prepayment given by Borrower, or (iv) as a
consequence of any other default by Borrower in the repayment of its LIBOR Rate
Loans when required by the terms of this Agreement.
E. Booking of LIBOR Rate Loans. Any Lender may make, carry or
transfer LIBOR Rate Loans at, to, or for the account of any of its branch
offices or the office of an Affiliate of that Lender; provided that each Lender
agrees to use reasonable efforts (consistent with legal and regulatory
restrictions) to designate a different lending office if it would reduce or
eliminate any additional amounts payable by Borrower pursuant to subsections
2.6B, 2.6C or 2.6D.
F. Assumptions Concerning Funding of LIBOR Rate Loans.
Calculation of all amounts payable to a Lender under this subsection 2.6 and
under subsection 2.7A shall be made as though that Lender had actually funded
each of its relevant LIBOR Rate Loans
669235.2
through the purchase of a LIBOR deposit bearing interest at the rate obtained
pursuant to clause (i) of the definition of Adjusted LIBOR Rate in an amount
equal to the amount of such LIBOR Rate Loan and having a maturity comparable to
the relevant Interest Period and through the transfer of such LIBOR deposit from
an offshore office of that Lender to a domestic office of that Lender in the
United States of America; provided, however, that each Lender may fund each of
its LIBOR Rate Loans in any manner it sees fit and the foregoing assumptions
shall be utilized only for the purposes of calculating amounts payable under
this subsection 2.6 and under subsection 2.7A.
G. LIBOR Rate Loans After Default. After the occurrence of and
during the continuation of a Potential Event of Default or an Event of Default,
(i) Borrower may not elect to have a Loan be made or maintained as a LIBOR Rate
Loan after the expiration of any Interest Period then in effect for that Loan
and (ii) subject to the provisions of subsection 2.6D, any Notice of Borrowing
or Notice of Continuation given by Borrower with respect to a requested
borrowing or continuation that has not yet occurred shall be deemed to be
rescinded by Borrower and upon expiration of any Interest Period during the
continuation of a Potential Event of Default or an Event of Default, the
applicable LIBOR Rate Loans shall be automatically converted to Base Rate Loans.
2.7 Increased Costs; Taxes; Capital Adequacy.
A. Compensation for Increased Costs and Taxes. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto) that any law, treaty or governmen tal rule, regulation
or order, or any change therein or in the interpretation, administration or
application thereof (including the introduction of any new law, treaty or
governmental rule, regulation or order), or any determination of a court or
governmental authority, in each case that becomes effective after the date
hereof, or compliance by such Lender with any guideline, request or directive
issued or made after the date hereof by any central bank or other governmental
or quasi-governmental authority (whether or not having the force of law):
(i) subjects such Lender (or its applicable lending office) to
any additional Tax (other than any Tax on the overall net income of
such Lender) with respect to this Agreement or any of its obligations
hereunder or any payments to such Lender (or its applicable lending
office) of principal, interest, fees or any other amount payable
hereunder;
(ii) imposes, modifies or holds applicable any reserve
(including any marginal, emergency, supplemental, special or other
reserve), special deposit, compulsory loan, FDIC insurance or similar
requirement against assets held by, or deposits or other liabilities in
or for the account of, or advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such
Lender
669235.2
(other than any such reserve or other requirements with respect to
LIBOR Rate Loans that are reflected in the definition of Adjusted LIBOR
Rate); or
(iii) imposes any other condition (other than with respect to a
Tax matter) on or affecting such Lender (or its applicable lending
office) or its obligations hereunder or the interbank LIBOR market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining its Loan hereunder or to reduce any
amount received or receivable by such Lender (or its applicable lending office)
with respect thereto; then, in any such case, Borrower shall promptly pay to
such Lender, upon receipt of the statement referred to in the next sentence,
such additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Borrower (with a copy to Agent) a
written statement, setting forth in reasonable detail the basis for calculating
the additional amounts owed to such Lender under this subsection 2.7A, which
statement shall be conclusive and binding upon all parties hereto absent
manifest error. In the event that any Lender receives a refund of any taxes in
respect of which such Lender received payment from Borrower under this
subsection 2.7A, such Lender shall apply the refund to reimburse Borrower in an
aggregate amount not to exceed the aggregate amount paid by Borrower pursuant to
this subsection 2.7A in respect of such refunded taxes.
B. Withholding of Taxes.
(i) Payments to Be Free and Clear. All sums payable by Borrower
under this Agreement and the other Loan Documents shall (except to the
extent required by law) be paid free and clear of, and without any
deduction or withholding on account of, any Tax (other than a Tax on
the overall net income of any Lender) imposed, levied, collected,
withheld or assessed by or within the United States of America or any
political subdivision in or of the United States of America or any
other jurisdiction from or to which a payment is made by or on behalf
of Borrower or by any federation or organization of which the United
States of America or any such jurisdiction is a member at the time of
payment.
(ii) Evidence of Exemption From U.S. Withholding Tax.
(a) Each Lender that is organized under the laws of
any jurisdiction other than the United States or any state or
other political subdivision thereof (for purposes of this
subsection 2.7B(ii), a "Non-US Lender") shall deliver to Agent
for transmission to Borrower, on or prior to the Closing Date
(in the case of each Lender listed on the signature pages
hereof) or on or prior to the date of the Assignment Agreement
pursuant to which it becomes a Lender (in the case of each
other Lender), and at such other times as may be necessary in
the
669235.2
determination of Borrower or Agent (each in the reasonable
exercise of its discretion), (1) two original copies of
Internal Revenue Service Form 1001 or 4224 (or any successor
forms), properly completed and duly executed by such Lender,
together with any other certificate or statement of exemption
required under the Internal Revenue Code or the regulations
issued thereunder to establish that such Lender is not subject
to deduction or withholding of United States federal income tax
with respect to any payments to such Lender of principal,
interest, fees or other amounts payable under any of the Loan
Documents or (2) if such Lender is not a "bank" or other Person
described in Section 881(c)(3) of the Internal Revenue Code and
cannot deliver either Internal Revenue Service Form 1001 or
4224 pursuant to clause (1) above, a Certificate re Non-Bank
Status together with two original copies of Internal Revenue
Service Form W-8 (or any successor form), properly completed
and duly executed by such Lender, together with any other
certificate or statement of exemption required under the
Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect to
any payments to such Lender of interest payable under any of
the Loan Documents.
(b) Each Lender required to deliver any forms,
certificates or other evidence with respect to United States
federal income tax withholding matters pursuant to subsection
2.7B(ii)(a) hereby agrees, from time to time after the initial
delivery by such Lender of such forms, certificates or other
evidence, whenever a lapse in time or change in circumstances
renders such forms, certificates or other evidence obsolete or
inaccurate in any material respect, that such Lender shall
promptly (1) deliver to Agent for transmission to Borrower two
new original copies of Internal Revenue Service Form 1001 or
4224, or a Certificate re Non-Bank Status and two original
copies of Internal Revenue Service Form W-8, as the case may
be, properly completed and duly executed by such Lender,
together with any other certificate or statement of exemption
required in order to confirm or establish that such Lender is
not subject to deduction or withholding of United States
federal income tax with respect to payments to such Lender
under the Loan Documents or (2) notify Agent and Borrower of
its inability to deliver any such forms, certificates or other
evidence.
C. Capital Adequacy Adjustment. If any Lender shall have
determined that the adoption, effectiveness, phase-in or applicability after the
date hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such governmental authority, central bank or comparable agency, has or would
have the effect of reducing the rate
669235.2
of return on the capital of such Lender or any corporation controlling such
Lender as a consequence of, or with reference to, such Lender's Loan or
Commitment or other obligations hereunder to a level below that which such
Lender or such controlling corporation could have achieved but for such
adoption, effectiveness, phase-in, applicability, change or compliance (taking
into consideration the policies of such Lender or such controlling corporation
with regard to capital adequacy), then from time to time, within five Business
Days after receipt by Borrower from such Lender of the statement referred to in
the next sentence, Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender or such controlling corporation on an
after-tax basis for such reduction. Such Lender shall deliver to Borrower (with
a copy to Agent) a written statement, setting forth in reasonable detail the
basis of the calculation of such additional amounts, which statement shall be
conclusive and binding upon all parties hereto absent manifest error.
Section 3. CONDITIONS TO LOANS
The obligations of Lenders to make Loans hereunder are subject
to the satisfaction of the following conditions:
3.1 Conditions to Initial Loans.
The obligations of Lenders to make the initial Loans are, in addition
to the conditions specified in subsection 3.2, subject to the prior or
concurrent satisfaction of the following conditions:
A. Borrower Documents. On or before the Closing Date, Borrower
shall deliver or cause to be delivered to Lenders (or to Agent for Lenders with
sufficient originally executed copies, where appropriate, for each Lender and
its counsel) the following, each, unless otherwise noted, dated the Closing
Date:
(i) (a) a copy of its Articles of Incorporation, certified by
the Secretary of State (or similar official) of its jurisdiction of
incorporation, dated a recent date prior to the Closing Date and (b) a
good standing certificate or certificate of existence from the
Secretary of State or similar official from the jurisdiction of its
incorporation and each other jurisdiction in which it is qualified to
do business;
(ii) Copies of its Bylaws, certified as of the Closing Date by
its corporate secretary or an assistant secretary;
(iii) Resolutions of its Board of Directors approving and
authorizing the execution, delivery and performance of this Agreement
and the other Loan Documents, certified as of the Closing Date by its
corporate secretary or an assistant secretary as being in full force
and effect without modification or amendment;
669235.2
(iv) Signature and incumbency certificate of the Persons
executing on behalf of Borrower any Loan Documents to which Borrower is
a party;
(v) Executed originals of this Agreement, the Notes (duly
executed in accordance with subsection 2.1E, drawn to the order of each
Lender and with appropriate insertions) and the other Loan Documents;
and
(vi) Such other documents as Agent may reasonably request.
B. Legal Opinions.
(i) Opinions of Borrower's Counsel. Agent and Lenders and their
respective counsel shall have received (a) originally executed copies
of one or more favorable written opinions of Battle ▇▇▇▇▇▇ LLP, counsel
for Borrower, in form and substance reasonably satisfactory to Agent
and its counsel, dated as of the Closing Date and setting forth
substantially the matters in the opinions designated in Exhibit IV
annexed hereto and as to such other matters as Agent acting on behalf
of Lenders may reasonably request and (b) evidence satisfactory to
Agent that Borrower has requested such counsel to deliver such opinions
to Agent and Lenders.
(ii) Opinions of Agent's Counsel. Lenders shall have received
originally executed copies of one or more favorable written opinions of
O'Melveny & ▇▇▇▇▇ LLP, counsel to Agent, dated as of the Closing Date,
substantially in the form of Exhibit V annexed hereto and as to such
other matters as Agent acting on behalf of Lenders may reasonably
request.
C. Fees. Borrower shall have paid to Agent, for distribution
(as appropriate) to Agent and Lenders, the fees payable on the Closing Date
referred to in subsection 2.3.
D. Security Interests in Collateral. Agent shall have received
evidence satisfactory to it that Borrower shall have taken or caused to be taken
all such actions, executed and delivered or caused to be executed and delivered
all such agreements, documents and instruments that may be necessary or, in the
opinion of Agent, desirable in order to create in favor of Agent, for the
benefit of Lenders, a valid and perfected first priority security interest in
the entire Collateral. Such actions shall include the following:
(i) Delivery to Agent of accurate and complete schedules to all
of the applicable Collateral Documents.
(ii) Delivery to Agent of certificates (which certificates
shall be accompanied by irrevocable undated stock powers, duly endorsed
in blank and otherwise satisfactory in form and substance to Agent)
representing all capital stock pledged pursuant to Pledge Agreement;
and
669235.2
(iii) Delivery to Agent of UCC financing statements duly
executed by Borrower with respect to all Collateral of Borrower for
filing in all jurisdictions as may be necessary or, in the opinion of
Agent, desirable to perfect the security interests created in such
Collateral pursuant to the Collateral Documents.
E. Consents; Related Agreements. Borrower shall have obtained
all Governmental Authorizations and all consents of other Persons that are
necessary or that Agent may request in connection with the transactions
contemplated by the Loan Documents, all in form and substance satisfactory to
the Agent. In addition, Borrower shall have entered into amendments of, or
supplements to, each Related Agreement to the extent necessary or that Agent may
request in connection with the transactions contemplated by the Loan Documents,
all in form and substance satisfactory to the Agent. Without limiting the
generality of the foregoing:
(i) *
(ii) *
(iii) *
(iv) *
(v) *
F. Completion of Proceedings. All corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Agent, acting on behalf of Lenders, and its counsel shall be
satisfactory in form and substance to Agent and such counsel, and Agent and such
counsel shall have received all such counterpart originals or certified copies
of such documents as Agent may reasonably request.
3.2 Conditions to All Loans.
The obligations of Lenders to make Loans on each Funding Date
are subject to the following further conditions precedent:
A. Notice of Borrowing. Agent shall have received before the
Funding Date, in accordance with the provisions of subsection 2.1B, an
originally executed Notice of Borrowing signed by the chief executive officer,
the chief financial officer or the treasurer of Borrower. -------- * Material
omitted pursuant to a request for Confidential Treatment and filed separately
with the Commission.
669235.2
B. Loan to Value Ratio. After giving effect to the proposed
Loan to be made on the Funding Date (other than the Closing Date), (i) the
aggregate principal amount of outstanding Loans on such Funding Date shall not
exceed the product of (a) the Average Collateral Market Value as of such Funding
Date multiplied by (b) __%* and (ii) the aggregate principal amount of the Loans
made under this Agreement (without giving effect to any prepayments thereof)
shall not exceed the aggregate amount of the Commitments.
C. Certain Other Conditions. As of that Funding Date:
(i) The representations and warranties contained herein and in
the other Loan Documents shall be true, correct and complete in all
material respects on and as of the Funding Date to the same extent as
though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date,
in which case such representations and warranties shall have been true,
correct and complete in all material respects on and as of such earlier
date.
(ii) No event shall have occurred and be continuing as of the
Funding Date, or would result from the consummation of the borrowing of
the Loans thereon, that would constitute an Event of Default or a
Potential Event of Default.
(iii) Borrower shall have performed in all material respects
all agreements and satisfied all conditions which this Agreement
provides shall be performed or satisfied by it on or before the Funding
Date.
(iv) No order, judgment or decree of any court, arbitrator or
governmental authority shall purport to enjoin or restrain any Lender
from making the Loan to be made by it on the Funding Date.
(v) The making of the Loans requested on the Funding Date and
the pledge of the ▇▇▇▇▇ Common Stock pursuant to the Pledge Agreement
shall not violate any law, including Regulation G, Regulation T,
Regulation U or Regulation X of the Board of Governors of the Federal
Reserve System.
(vi) There shall not be pending or, to the knowledge of
Borrower, threatened, any action, suit, proceeding, governmental
investigation or arbitration against or affecting Borrower or any of
its Subsidiaries or any property of Borrower or any of its Subsidiaries
that has not been disclosed by Borrower in writing pursuant to
subsection 4.6 prior to the execution of this Agreement, and there
shall have occurred no development not so disclosed in any such action,
suit, proceeding, governmental
--------
* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
investigation or arbitration so disclosed, that, in either event, in
the opinion of Agent or of Requisite Lenders, would be expected to have
a Material Adverse Effect.
Section 4. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to
make the Loans hereunder, Borrower represents and warrants to each Lender, on
the date of this Agreement and on the Closing Date, that the following
statements are true, correct and complete:
4.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries.
A. Organization and Powers. Borrower is a corporation duly
formed, validly existing and in good standing under the laws of the State of
Maryland. Borrower has all requisite corporate power and authority to own and
operate its properties, to carry on its business as now conducted and as
proposed to be conducted, to enter into the Loan Documents and to carry out the
transactions contemplated thereby.
B. Qualification and Good Standing. Borrower is qualified to do
business and in good standing in every jurisdiction necessary to carry out its
business and operations, except in jurisdictions where the failure to be so
qualified or in good standing will not have a Material Adverse Effect.
C. Conduct of Business. Borrower is engaged only in the
businesses permitted to be engaged in pursuant to subsection 6.8.
D. Subsidiaries. Borrower does not have, and has never had, any
Subsidiaries.
4.2 Authorization of Borrowing, etc.
A. Authorization of Borrowing. The execution, delivery and
performance of the Loan Documents have been duly authorized by all necessary
action on the part of Borrower.
B. No Conflict. The execution, delivery and performance by
Borrower of the Loan Documents and the consummation of the transactions
contemplated by the Loan Documents do not and will not (i) violate (A) any
provision of any law or any governmental rule or regulation applicable to
Borrower, (B) any charter document of Borrower or (C) any order, judgment or
decree of any court or other agency of government binding on Borrower, (ii)
conflict with, result in a breach of or constitute (with due notice or lapse of
time or both) a default under any contractual obligation of Borrower, (iii)
result in or require the creation or imposition of any Lien upon any of the
properties or assets of Borrower (other than any Liens created pursuant to the
Collateral Documents) or (iv) require any approval of
669235.2
stockholders or any approval or consent of any Person under any material
contract of Borrower, except for such approvals or consents which will be
obtained on or before the Closing Date and disclosed in writing to Lenders.
C. Governmental Consents. The execution, delivery and
performance by Borrower of the Loan Documents and the consummation of the
transactions contemplated by the Loan Documents do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body.
D. Binding Obligation. Each of the Loan Documents has been duly
executed and delivered by Borrower and is the legally valid and binding
obligation of Borrower, enforceable against Borrower in accordance with its
respective terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors'
rights generally or by equitable principles relating to enforceability.
4.3 Financial Condition.
Borrower has heretofore delivered to Agent at Agents' request,
the following financial statements and information: (i) * and (ii) the unaudited
balance sheet of Borrower as at February 20, 1997. All such statements were
prepared in conformity with GAAP and fairly present, in all material respects,
the financial position of the entities described in such financial statements as
at the respective dates thereof, subject, in the case of any such unaudited
financial statements, to changes resulting from audit and normal year-end
adjustments. Borrower does not (and will not following the funding of the
initial Loans) have any Contingent Obligation, contingent liability or liability
for taxes, long-term lease or unusual forward or long-term commitment that is
not reflected in the foregoing financial statements or the notes thereto and
which in any such case is material in relation to the business, operations,
properties, assets or condition (financial or otherwise) of Borrower.
4.4 No Material Adverse Change; No Restricted Junior Payments.
Since February 20, 1997, no event or change has occurred that
has caused or evidences, either in any case or in the aggregate, a Material
Adverse Effect. Borrower has not directly or indirectly declared, ordered, paid
or made, or set apart any sum or property for, any Restricted Junior Payment or
agreed to do so except as permitted by subsection 6.5.
--------
* Material omitted pursuant to a request for Confidential Treatment and filed
separately with the Commission.
669235.2
4.5 Title to Properties; Liens.
Borrower has good title to all of the ▇▇▇▇▇ Common Stock set
forth on Schedule I to the Pledge Agreement. All such ▇▇▇▇▇ Common Stock is free
and clear of Liens, except for Liens created pursuant to the Collateral
Documents.
4.6 Litigation; Adverse Facts.
There are no actions, suits, proceedings, arbitrations or
governmental investiga tions (whether or not purportedly on behalf of Borrower)
at law or in equity, or before or by any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign (including any Environmental Claims) that are pending or, to
the knowledge of Borrower, threatened against or affecting Borrower or any
property of Borrower and that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect. Borrower (i) is
not in violation of any applicable laws that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect, or (ii) is
not subject to or in default with respect to any final judgments, writs,
injunctions, decrees, rules or regulations of any court or any federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect.
4.7 Payment of Taxes; Classification for Tax Purposes. Except to the extent
permitted by subsection 5.3, all tax returns and reports of Borrower required to
be filed by it have been timely filed, and all taxes shown on such tax returns
to be due and payable and all assessments, fees and other governmental charges
upon Borrower and upon its properties, assets, income, businesses and franchises
which are due and payable have been paid when due and payable. Borrower knows of
no proposed tax assessment against Borrower which is not being actively
contested by Borrower in good faith and by appropriate proceedings; provided
that such reserves or other appropriate provisions, if any, as shall be required
in conformity with GAAP shall have been made or provided therefor.
4.8 Performance of Agreements; Materially Adverse Agreements; Material
Contracts and Related Agreements.
A. Borrower is not in default in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in any
of its material contracts, and no condition exists that, with the giving of
notice or the lapse of time or both, would constitute such a default, except
where the consequences, direct or indirect, of such default or defaults, if any,
would not have a Material Adverse Effect.
B. Borrower is not a party to or otherwise subject to any
agreements or instruments or any charter or other internal restrictions which,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.
669235.2
C. Schedule 4.8 contains a true, correct and complete list of
all the material contracts in effect on the Closing Date. Except as described on
Schedule 4.8, all such material contracts are in full force and effect and no
material defaults currently exist thereunder.
D. None of Borrower, ▇▇▇▇▇ or any other Person party to a
Related Agreement is in default in any material respect in the performance,
observance or fulfillment of any of the their respective obligations, covenants
or conditions contained in any Related Agreement.
4.9 Governmental Regulation.
Borrower is not subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act
or the Investment Company Act of 1940 or under any other federal or state
statute or regulation which may limit its ability to incur Indebtedness or which
may otherwise render all or any portion of the Obligations unenforceable.
4.10 Securities Activities.
Borrower is not engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying any Margin Stock.
4.11 Employee Benefit Plans.
Borrower and each of its ERISA Affiliates are in material
compliance with all applicable provisions and requirements of ERISA and the
regulations and published interpretations thereunder with respect to each
Employee Benefit Plan, and have performed in all material respects all their
obligations under each Employee Benefit Plan. Each Employee Benefit Plan which
is intended to qualify under Section 401(a) of the Internal Revenue Code is so
qualified.
4.12 Certain Fees.
No broker's or finder's fee or commission will be payable with
respect to this Agreement or any of the transactions contemplated hereby.
4.13 Employee Matters.
Borrower has no, and has never had any, employees.
4.14 Solvency.
Borrower is and, upon the incurrence of any Obligations by
Borrower on any date on which this representation is made, will be, Solvent.
669235.2
4.15 ▇▇▇▇▇ Common Stock.
Borrower beneficially and legally owns 4,713,598 shares of
▇▇▇▇▇ Common Stock. None of Borrower's Affiliates owns, legally or beneficially,
any ▇▇▇▇▇ Common Stock or any right to receive, subscribe for or otherwise
acquire any shares of ▇▇▇▇▇ Common Stock.
4.16 Disclosure.
No representation or warranty of Borrower contained in any Loan
Document or in any other document, certificate or written statement furnished to
Lenders by or on behalf of Borrower for use in connection with the transactions
contemplated by this Agreement contains any untrue statement of a material fact
or omits to state a material fact (known to Borrower, in the case of any
document not furnished by it) necessary in order to make the statements
contained herein or therein not misleading in light of the circumstances in
which the same were made. There are no facts known (or which should upon the
reasonable exercise of diligence be known) to Borrower (other than matters of a
general economic nature) that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect and that have not
been disclosed herein or in such other documents, certificates and statements
furnished to Lenders for use in connection with the transactions contemplated
hereby.
Section 5. BORROWER'S AFFIRMATIVE COVENANTS
Borrower covenants and agrees that, so long as the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations, unless Requisite Lenders shall otherwise give prior
written consent, Borrower shall perform, all covenants in this Section 5.
5.1 Financial Statements and Other Reports.
Borrower will maintain a system of accounting established and
administered in accordance with sound business practices to permit preparation
of financial statements in conformity with GAAP. Borrower will deliver to Agent
and Lenders:
(i) Quarterly Financials: as soon as available and in any event
within 60 days after the end of each Fiscal Quarter, (a) the balance
sheet of Borrower* as at the end of such Fiscal Quarter and the related
statements of income and cash flows of Borrower* for such Fiscal
Quarter and for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter, setting forth in each
case in
--------
* Material omitted pursuant to a request for Confidential Treatment
and filed separately with the Commission.
669235.2
comparative form (to the extent available) the corresponding figures
for the corresponding periods of the previous Fiscal Year, all in
reasonable detail and certified by the chief financial officer of
Borrower that they fairly present, in all material respects, the
financial condition of Borrower* as at the dates indicated and the
results of their operations and their cash flows for the periods
indicated, subject to changes resulting from audit and normal year-end
adjustments, and (b) a narrative report describing the operations of
Borrower in the form prepared for presentation to Apollo's investors
for such Fiscal Quarter and for the period from the beginning of the
then current Fiscal Year to the end of such Fiscal Quarter;
(ii) Year-End Financials: as soon as available and in any event
within 120 days after the end of each Fiscal Year, (a) the balance
sheet of Borrower* as at the end of such Fiscal Year and the related
statements of income and cash flows of Borrower* for such Fiscal Year,
setting forth in each case in comparative form the corresponding
figures for the previous Fiscal Year, all in reasonable detail and
certified by the chief financial officer of Borrower that they fairly
present, in all material respects, the ▇▇▇▇▇ cial condition of
Borrower* as at the dates indicated and the results of its operations
and its (or their) cash flows for the periods indicated, (b) a
narrative report describing the operations of Borrower* and (c) *;
(iii) Officers' Certificate: together with each delivery of
financial statements of Borrower pursuant to subdivisions (i) and (ii)
above, an Officers' Certificate of Borrower stating that the signers
have reviewed the terms of this Agreement and have made, or caused to
be made under their supervision, a review in reasonable detail of the
transactions and condition of Borrower during the accounting period
covered by such financial statements and that such review has not
disclosed the existence during or at the end of such accounting period,
and that the signers do not have knowledge of the existence as at the
date of such Officers' Certificate, of any condition or event that
constitutes an Event of Default or Potential Event of Default, or, if
any such condition or event existed or exists, specifying the nature
and period of existence thereof and what action Borrower has taken, is
taking and proposes to take with respect thereto;
(iv) Reconciliation Statements: if, as a result of any change
in accounting principles and policies from those used in the
preparation of the audited financial statements referred to in
subsection 4.3, the financial statements of Borrower delivered pursuant
to subdivisions (i) or (ii) of this subsection 5.1 will differ in any
material respect from the consolidated financial statements that would
have been delivered pursuant to such subdivisions had no such change in
accounting principles and policies been made, then together with the
first delivery of financial statements pursuant to subdivision (i) or
(ii) of this subsection 5.1 following such change, financial statements
--------
* Material omitted pursuant to a request for Confidential Treatment
and filed separately with the Commission.
669235.2
of Borrower for (y) the current Fiscal Year to the effective date of
such change and (z) the Fiscal Year immediately preceding the Fiscal
Year in which such change is made, in each case prepared on a pro forma
basis as if such change had been in effect during such periods;
(v) Accountants' Reports: promptly upon receipt thereof (unless
restricted by applicable professional standards), copies of all reports
submitted to Borrower by independent certified public accountants in
connection with each annual, interim or special audit of the financial
statements of Borrower made by such accountants, includ ing any comment
letter submitted by such accountants to management in connection with
their annual audit;
(vi) Press Releases: promptly upon their becoming available,
copies of all press releases and other statements made available
generally by Borrower to the public concerning material developments in
the business of Borrower;
(vii) Events of Default, etc.: promptly upon any officer of
Borrower obtaining knowledge (a) of any condition or event that
constitutes an Event of Default or Potential Event of Default, or
becoming aware that any Lender has given any notice (other than to
Agent) or taken any other action with respect to a claimed Event of
Default or Potential Event of Default, (b) that any Person has given
any notice to Borrower or taken any other action with respect to a
claimed default or event or condition of the type referred to in
subsection 7.2, (c) of any condition or event that would be required to
be disclosed in a current report filed by Borrower with the Securities
and Exchange Commission on Form 8-K (Items 1, 2, 4, 5 and 6 of such
Form as in effect on the date hereof) if Borrower were required to file
such reports under the Exchange Act, or (d) of the occurrence of any
event or change that has caused or evidences, either in any case or in
the aggregate, a Material Adverse Effect, an Officers' Certificate
specifying the nature and period of existence of such condition, event
or change, or specifying the notice given or action taken by any such
Person and the nature of such claimed Event of Default, Potential Event
of Default, default, event or condition, and what action Borrower has
taken, is taking and proposes to take with respect thereto;
(viii) Litigation or Other Proceedings: promptly upon any
officer of Borrower obtaining knowledge of (X) the institution of, or
non-frivolous threat of, any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting Borrower or any property of Borrower
(collectively, "Proceedings") not previously disclosed in writing by
Borrower to Lenders or (Y) any material development in any Proceeding
that, in any case:
(1) if adversely determined, has a reasonable
possibility of giving rise to a Material Adverse Effect; or
669235.2
(2) seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain relief as
a result of, the transactions contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Borrower to enable Lenders and their counsel to
evaluate such matters;
(ix) ERISA Events: promptly upon becoming aware of the
occurrence of or forthcoming occurrence of any ERISA Event, a written
notice specifying the nature thereof, what action Borrower or any of
its ERISA Affiliates has taken, is taking or proposes to take with
respect thereto and, when known, any action taken or threatened by the
Internal Revenue Service, the Department of Labor or the PBGC with
respect thereto;
(x) ERISA Notices: with reasonable promptness, copies of (a)
all notices received by Borrower or any of its ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event and (b) copies of
such other documents or governmental reports or filings relating to any
Employee Benefit Plan as Agent shall reasonably request;
(xi) Material Contracts: promptly, and in any event within ten
Business Days after any material contract of Borrower is terminated or
amended in a manner that is materially adverse to Borrower or any new
material contract is entered into, a written statement describing such
event with copies of such material amendments or new contracts, and an
explanation of any actions being taken with respect thereto;
(xii) ▇▇▇▇▇ Documents: promptly upon receipt, copies of all
financial statements, reports, notices, proxy statements, documents and
other information provided by ▇▇▇▇▇ pursuant to the Stock Purchase
Agreement or sent or made available generally by ▇▇▇▇▇ to its security
holders; and
(xiii) Other Information: with reasonable promptness, such
other information and data with respect to Borrower as from time to
time may be reasonably requested by any Lender.
5.2 Existence; Separateness.
A. Except as permitted under subsection 6.6, Borrower will at
all times preserve and keep in full force and effect its existence as a
corporation and all rights and franchises material to its business; provided,
however that Borrower shall not be required to preserve any such right or
franchise if the Board of Directors of Borrower shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
Borrower and that the loss thereof is not disadvantageous in any material
respect to Borrower or Lenders.
669235.2
B. Financial Matters. Borrower shall (i) maintain financial
statements, accounting records (including, without limitation, records regarding
payables and receivables) and other corporate records and other documents
separate from each other and any other Person; (ii) maintain its own bank
accounts in its own name, separate from each other and any other Person; (iii)
pay its own expenses and other liabilities from its own assets and incur (or
endeavor to incur) obligations to other Persons based solely upon its own assets
and creditworthiness and not upon the creditworthiness of each other or any
other Person; and (iv) maintain records of all intercompany transactions among
its Affiliates, compensate for the same on an arm's-length basis and making
regular, periodic payments on account of such intercompany obligations; and (v)
file its own tax returns or, if part of a consolidated group, join in the
consolidated tax return of such group as a separate member thereof.
C. Independent Business. Borrower shall manage its business
independently from the business of any other Person and in accordance with the
best interest of Borrower. Borrower shall conduct the administrative activities
of the Borrower separately from the administrative activities of any other
Person. Any moneys earned by Borrower on their assets or proceeds of the sale of
any of their assets shall be deposited in bank accounts separate from any of the
assets of any other Person, and no assets of the Borrower shall become
commingled with assets of such other Persons.
D. Business Dealings. Borrower shall hold itself out, and shall
continue to hold itself out, to the public and to its creditors as a legal
entity, separate and distinct from all other entities, and shall continue to
take all steps reasonably necessary to avoid (i) misleading any other Person as
to the identity of the entity with which such Person is transacting business or
(ii) implying that Borrower is, directly or indirectly, absolutely or
contingently, responsible (if such is not the case) for the Indebtedness or
other obligations of any other Person. Borrower shall not imply that any Person
is directly or indirectly, absolutely or contingently, responsible (if such is
not the case) for the Indebtedness or other obligations of Borrower.
5.3 Payment of Taxes and Claims; Classification for Tax Purposes.
A. Borrower will pay all taxes, assessments and other
governmental charges imposed upon it or any of its properties or assets or in
respect of any of its income, businesses or franchises before any penalty
accrues thereon, and all claims (including claims for labor, services, materials
and supplies) for sums that have become due and payable and that by law have or
may become a Lien upon any of its properties or assets, prior to the time when
any penalty or fine shall be incurred with respect thereto; provided that no
such tax, assessment or other charge or claim need be paid if it is being
contested in good faith by appropriate proceedings promptly instituted and
diligently conducted, so long as such reserve or other appropriate provision, if
any, as shall be required in conformity with GAAP shall have been made therefor.
B. Borrower has and will take all actions required to qualify
to be taxed as a real estate investment trust under Subchapter M of the Internal
Revenue Code.
669235.2
5.4 Inspection.
Borrower shall permit any authorized representatives designated
by Agent to visit and inspect any of the properties of Borrower to inspect, copy
and take extracts from its financial and accounting records, and to discuss its
affairs, finances and accounts with its officers and independent public
accountants (provided that Borrower may, if it so chooses, be present at or
participate in any such discussion), all upon reasonable notice and at such
reasonable times during normal business hours and as often as may reasonably be
requested; provided that, unless an Event of Default has occurred and is
continuing, such inspections shall not occur more frequently than once each
calendar quarter.
5.5 Compliance with Laws, etc.
Borrower shall comply, with the requirements of all applicable
laws, rules, regulations and orders of any governmental authority (including all
Environmental Laws), noncompliance with which could reasonably be expected to
cause, individually or in the aggregate, a Material Adverse Effect.
5.6 Further Assurances.
At any time or from time to time upon the request of Agent,
Borrower shall execute and deliver such further documents (including without
limitation such financing statements, continuation statements or amendments
thereto and such other documents and certificates as may be necessary or
desirable or as Agent may reasonably request, in order to perfect and preserve
the security interests granted or purported to be granted under any of the
Collateral Documents) and do such other acts and things as Agent may reasonably
request in order to effect fully the purposes of this Agreement and the other
Loan Documents and to provide for payment of the Obligations in accordance with
the terms of the Agreement and the other Loan Documents.
Section 6. BORROWER'S NEGATIVE COVENANTS
Borrower covenants and agrees that, so long as the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations, unless Requisite Lenders shall otherwise give prior
written consent, Borrower shall perform all covenants in this Section 6.
6.1 Indebtedness.
Borrower shall not, directly or indirectly, create, incur,
assume or guaranty, or otherwise become or remain directly or indirectly liable
with respect to, any Indebtedness, except:
669235.2
(i) Borrower may become and remain liable with respect to the
Obligations; and
(ii) Borrower may become and remain liable with respect to
Indebtedness owed to Apollo; provided that all such Indebtedness shall
be subordinated to the Obligations pursuant to a subordination
agreement satisfactory in form and substance to Agent in its sole
discretion.
6.2 Liens and Related Matters.
A. Prohibition on Liens. Borrower shall not directly or
indirectly, create, incur, assume or permit to exist any Lien on or with respect
to any property or asset of any kind (including any document or instrument in
respect of goods or accounts receivable) of Borrower whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the Uniform Commercial Code of any State or under any similar
recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens pursuant to the Collateral Documents to secure the
Obligations.
B. Equitable Lien in Favor of Lenders. If Borrower shall create
or assume any Lien upon any of its properties or assets, whether now owned or
hereafter acquired, other than Liens excepted by the provisions of subsection
6.2A, it shall make or cause to be made effective provision whereby the
Obligations will be secured by such Lien equally and ratably with any and all
other Indebtedness secured thereby as long as any such Indebtedness shall be so
secured; provided that, notwithstanding the foregoing, this covenant shall not
be construed as a consent by Requisite Lenders to the creation or assumption of
any such Lien not permitted by the provisions of subsection 6.2A.
C. No Further Negative Pledges. Borrower shall not enter into
any agreement prohibiting the creation or assumption of any Lien upon any of its
properties or assets, whether now owned or hereafter acquired.
6.3 Investments.
Borrower shall not, directly or indirectly, make or own any
Investment in any Person, including any joint venture, except:
(i) Borrower may make and own Investments in Cash Equivalents;
and
669235.2
(ii) Borrower may make and own the Investments in ▇▇▇▇▇ Common
Stock and rights to acquire ▇▇▇▇▇ Common Stock; provided that Borrower
shall pledge all such ▇▇▇▇▇ Common Stock and rights to acquire ▇▇▇▇▇
Common Stock in favor of Agent pursuant to the Pledge Agreement.
6.4 Contingent Obligations.
Borrower shall not, directly or indirectly, create or become or
remain liable with respect to any Contingent Obligation.
6.5 Restricted Junior Payments.
Borrower shall not directly or indirectly, declare, order, pay,
make or set apart any sum for any Restricted Junior Payment except for (i)
dividends or other distributions to Apollo and (ii) payments of principal and
interest on Indebtedness owed to Apollo; provided that, upon the occurrence and
during the continuance of an Event of Default or Potential Event of Default, the
Borrower shall not make any dividend or other distribution to Apollo or make any
payments, whether for principal, interest or otherwise, in respect of
subordinated Indebtedness.
6.6 Restriction on Fundamental Changes; Asset Sales and Acquisitions.
Borrower shall not, alter the corporate, capital or legal
structure of Borrower, or enter into any transaction of merger or consolidation,
or liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets, whether now
owned or hereafter acquired, or acquire by purchase or otherwise all or
substantially all the business, property or fixed assets of, or stock or other
evidence of beneficial ownership of, any Person or any division or line of
business of any Person, or create any Subsidiary except that Borrower may make
Asset Sales; provided that (i) the consideration received for such assets shall
be in an amount at least equal to the fair market value thereof; (ii) the sole
consideration received shall be cash; (iii) concurrently with such Asset Sale,
Borrower shall make all prepayments required pursuant to subsection 2.4B(ii)(a)
and (iv) no Event of Default or Potential Event of Default shall have occurred
and be continuing; provided further, that Borrower may make Restricted Junior
Payments in accordance with the provisions of subsection 6.5.
6.7 Transactions with Shareholders and Affiliates.
Borrower shall not, directly or indirectly, enter into or
permit to exist any transaction (including the purchase, sale, lease or exchange
of any property or the rendering of any service) with any holder of 5% or more
of any class of equity Securities of Borrower or with any Affiliate of Borrower
or of any such holder, on terms that are less favorable to Borrower, than those
that might be obtained at the time from Persons who are not such a
669235.2
holder or Affiliate; provided, that Borrower may make Restricted Junior Payments
in accordance with the provisions of subsection 6.5.
6.8 Conduct of Business; Incurrence of Liabilities.
From and after the Closing Date, Borrower shall not engage in
any business other than ownership of the ▇▇▇▇▇ Common Stock and actions directly
related thereto.
6.9 Amendment of Certain Related Agreements.
Borrower shall not amend, restate, supplement or otherwise
modify any Related Agreement to which it is a party, or waive any term or
provision thereof, without, in each case, the prior written consent of Agent.
6.10 Fiscal Year
Borrower shall not change its Fiscal Year-end from December 31.
Section 7. EVENTS OF DEFAULT
If any of the following conditions or events ("Events of
Default") shall occur:
7.1 Failure to Make Payments When Due.
Failure by Borrower to pay any installment of principal of any
Loan when due, whether at stated maturity, by acceleration, by notice of
voluntary prepayment, by mandatory prepayment or otherwise; or failure by
Borrower to pay any interest on any Loan within one Business Day after the date
due or to pay any fee or any other amount due under this Agreement within five
Business Days after the date due; or
7.2 Default in Other Obligations.
Failure of Borrower to pay when due any obligations (other than
amounts referred to in subsection 7.1) in an individual amount of $250,000 or
more or with an aggregate amount of $500,000 or more, in each case beyond the
end of any grace period provided therefor; or
7.3 Breach of Certain Covenants.
Failure of Borrower to perform or comply with any term or
condition contained in subsection 2.5 or 5.2 or Section 6 of this Agreement; or
669235.2
7.4 Breach of Warranty.
Any representation, warranty, certification or other statement
made by Borrower in any Loan Document or in any statement or certificate at any
time given by Borrower in writing pursuant hereto or thereto or in connection
herewith or therewith shall be false in any material respect on the date as of
which made; or
7.5 Other Defaults Under Loan Documents.
Borrower shall default in the performance of or compliance with
any term contained in this Agreement or any of the other Loan Documents, other
than any such term referred to in any other subsection of this Section 7, and
such default shall not have been remedied or waived within 30 days after the
earlier of (i) an officer of Borrower becoming aware of such default or (ii)
receipt by Borrower of notice from Agent or any Lender of such default; or
7.6 Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) A court having jurisdiction in the premises shall enter a
decree or order for relief in respect of Borrower in an involuntary case under
the Bankruptcy Code or under any other applicable bankruptcy, insolvency or
similar law now or hereafter in effect, which decree or order is not stayed; or
any other similar relief shall be granted under any applicable federal or state
law; or (ii) an involuntary case shall be commenced against Borrower under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar
law now or hereafter in effect; or a decree or order of a court having
jurisdiction in the premises for the appointment of a receiver, liquidator,
sequestrator, trustee, custodian or other officer having similar powers over
Borrower, or over all or a substantial part of its property, shall have been
entered; or there shall have occurred the involuntary appointment of an interim
receiver, trustee or other custodian of Borrower for all or a substantial part
of its property; or a warrant of attachment, execution or similar process shall
have been issued against any substantial part of the property of Borrower, and
any such event described in this clause (ii) shall continue for 60 days unless
dismissed, bonded or discharged; or
7.7 Voluntary Bankruptcy; Appointment of Receiver, etc.
(i) Borrower shall have an order for relief entered with
respect to it or commence a voluntary case under the Bankruptcy Code or under
any other applicable bankruptcy, insolvency or similar law now or hereafter in
effect, or shall consent to the entry of an order for relief in an involuntary
case, or to the conversion of an involuntary case to a voluntary case, under any
such law, or shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial part of its
property; or Borrower shall make any assignment for the benefit of creditors; or
(ii) Borrower shall be unable, or shall fail generally, or shall admit in
writing its inability, to pay its debts as such debts become due; or the Board
of Directors of Borrower (or any committee thereof) shall
669235.2
adopt any resolution or otherwise authorize any action to approve any of the
actions referred to in clause (i) above or this clause (ii); or
7.8 Judgments and Attachments.
Any money judgment, writ or warrant of attachment or similar
process involving (i) in any individual case an amount in excess of $250,000 or
(ii) in the aggregate at any time an amount in excess of $500,000 (in either
case not adequately covered by insurance as to which a solvent and unaffiliated
insurance company has acknowledged coverage) shall be entered or filed against
Borrower or any of its assets and shall remain undischarged, unvacated, unbonded
or unstayed for a period of 60 days (or in any event later than five days prior
to the date of any proposed sale thereunder); or
7.9 Dissolution.
Any order, judgment or decree shall be entered against Borrower
decreeing the dissolution or split up of Borrower and such order shall remain
undischarged or unstayed for a period in excess of 30 days; or
7.10 Employee Benefit Plans.
There shall occur one or more ERISA Events which individually
or in the aggregate results in or might reasonably be expected to result in
liability of Borrower or any of its ERISA Affiliates in excess of $1,000,000
during the term of this Agreement; or there shall exist an amount of unfunded
benefit liabilities (as defined in Section 4001(a)(18) of ERISA), individually
or in the aggregate for all Pension Plans (excluding for purposes of such
computation any Pension Plans with respect to which assets exceed benefit
liabilities), which exceeds $2,000,000; or
7.11 Failure to Qualify as a REIT.
▇▇▇▇▇ ceases to qualify and be taxed as a real estate
investment trust under Subchapter M of the Internal Revenue Code; or
7.12 Failure of Security; Repudiation of Obligations.
At any time after the execution and delivery thereof, any
Collateral Document shall cease to be in full force and effect (other than by
reason of a release of Collateral thereunder in accordance with the terms hereof
or thereof, the satisfaction in full of the Obligations or any other termination
of such Collateral Document in accordance with the terms hereof or thereof) or
shall be declared null and void, or Agent shall not have or shall cease to have
a valid and perfected first priority Lien in any Collateral purported to be
covered thereby, in each case for any reason other than the failure of Agent or
any Lender to take any action within its control, or (ii) Borrower shall contest
the validity or enforceability of any Loan
669235.2
Document in writing or deny in writing that it has any further liability,
including with respect to future advances by Lenders, under any Loan Document to
which it is a party; or
7.13 Amendment of Certain Related Agreements.
Any Related Agreement to which Borrower is not a party shall be
amended in any manner that is adverse to Agent or any Lender; or
7.14 Listing on National Securities Exchange.
The ▇▇▇▇▇ Common Stock shall not be listed on a national
securities exchange.
THEN (i) upon the occurrence of any Event of Default described in subsection 7.6
or 7.7, each of (a) the unpaid principal amount of and accrued interest on the
Loans and (b) all other Obligations shall automatically become immediately due
and payable, without presentment, demand, protest or other requirements of any
kind, all of which are hereby expressly waived by Borrower, and the obligation
of each Lender to make any Loan shall thereupon terminate, and (ii) upon the
occurrence and during the continuation of any other Event of Default, Agent
shall, upon the written request or with the written consent of Requisite
Lenders, by written notice to Borrower, declare all or any portion of the
amounts described in clauses (a) and (b) above to be, and the same shall
forthwith become, immediately due and payable, and the obligation of each Lender
to make any Loan shall thereupon terminate.
Notwithstanding anything contained in the preceding paragraph,
if at any time within 60 days after an acceleration of the Loans pursuant to
clause (ii) of such paragraph Borrower shall pay all arrears of interest and all
payments on account of principal which shall have become due otherwise than as a
result of such acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Events of Default and Potential Events of Default (other than
non-payment of the principal of and accrued interest on the Loans, in each case
which is due and payable solely by virtue of acceleration) shall be remedied or
waived pursuant to subsection 9.6, then Requisite Lenders, by written notice to
Borrower, may at their option rescind and annul such acceleration and its
consequences; but such action shall not affect any subsequent Event of Default
or Potential Event of Default or impair any right consequent thereon. The
provisions of this paragraph are intended merely to bind Lenders to a decision
which may be made at the election of Requisite Lenders and are not intended,
directly or indirectly, to benefit Borrower, and such provisions shall not at
any time be construed so as to grant Borrower the right to require Lenders to
rescind or annul any acceleration hereunder or to preclude Agent or Lenders from
exercising any of the rights or remedies available to them under any of the Loan
Documents, even if the conditions set forth in this paragraph are met.
669235.2
Section 8. AGENT
8.1 Appointment.
Bankers is hereby appointed Agent hereunder and under the other
Loan Documents and each Lender hereby authorizes Agent to act as its agent in
accordance with the terms of this Agreement and the other Loan Documents. Agent
agrees to act upon the express conditions contained in this Agreement and the
other Loan Documents, as applicable. The provisions of this Section 8 are solely
for the benefit of Agent and, except as provided in subsection 8.5, Lenders and
Borrower shall have no rights as a third party beneficiary of any of the
provisions thereof. In performing its functions and duties under this Agreement,
Agent shall act solely as an agent of Lenders and does not assume and shall not
be deemed to have assumed any obligation towards or relationship of agency or
trust with or for Borrower.
8.2 Powers and Duties; General Immunity.
▇. ▇▇▇▇▇▇; Duties Specified. Each Lender irrevocably authorizes
Agent to take such action on such Lender's behalf and to exercise such powers,
rights and remedies hereunder and under the other Loan Documents as are
specifically delegated or granted to Agent by the terms hereof and thereof,
together with such powers, rights and remedies as are reasonably incidental
thereto. Agent shall have only those duties and responsibilities that are
expressly specified in this Agreement and the other Loan Documents. Agent may
exercise such powers, rights and remedies and perform such duties by or through
its agents or employees. Agent shall not have, by reason of this Agreement or
any of the other Loan Documents, a fiduciary relationship in respect of any
Lender; and nothing in this Agreement or any of the other Loan Documents,
expressed or implied, is intended to or shall be so con strued as to impose upon
Agent any obligations in respect of this Agreement or any of the other Loan
Documents except as expressly set forth herein or therein.
B. No Responsibility for Certain Matters. Agent shall not be
responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or any
other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by Agent to Lenders or by or on behalf of
Borrower to Agent or any Lender in connection with the Loan Documents and the
transactions contemplated thereby or for the financial condition or business
affairs of Borrower or any other Person liable for the payment of any
Obligations, nor shall Agent be required to ascertain or inquire as to the
performance or observance of any of the terms, conditions, provisions, covenants
or agreements contained in any of the Loan Documents or as to the use of the
proceeds of the Loans or as to the existence or possible existence of any Event
of Default or Potential Event of Default. Anything contained in this Agreement
to the contrary not withstanding, Agent shall not have any liability arising
from confirmations of the amount of outstanding Loans.
669235.2
C. Exculpatory Provisions. Neither Agent nor any of its
officers, directors, employees or agents shall be liable to Lenders for any
action taken or omitted by Agent under or in connection with any of the Loan
Documents except to the extent caused by Agent's gross negligence or willful
misconduct. Agent shall be entitled to refrain from any act or the taking of any
action (including the failure to take an action) in connection with this
Agreement or any of the other Loan Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
Agent shall have received instructions in respect thereof from Requisite Lenders
(or such other Lenders as may be required to give such instructions under
subsection 9.6) and, upon receipt of such instructions from Requisite Lenders
(or such other Lenders, as the case may be), Agent shall be entitled to act or
(where so instructed) refrain from acting, or to exercise such power, discretion
or authority, in accordance with such instructions. Without prejudice to the
generality of the foregoing, (i) Agent shall be entitled to rely, and shall be
fully protected in relying, upon any communica tion, instrument or document
believed by it to be genuine and correct and to have been signed or sent by the
proper person or persons, and shall be entitled to rely and shall be protected
in relying on opinions and judgments of attorneys (who may be attorneys for
Borrower), accountants, experts and other professional advisors selected by it;
and (ii) no Lender shall have any right of action whatsoever against Agent as a
result of Agent acting or (where so instructed) refraining from acting under
this Agreement or any of the other Loan Documents in accordance with the
instructions of Requisite Lenders (or such other Lenders as may be required to
give such instructions under subsection 9.6).
D. Agent Entitled to Act as Lender. The agency hereby created
shall in no way impair or affect any of the rights and powers of, or impose any
duties or obligations upon, Agent in its individual capacity as a Lender
hereunder. With respect to its participation in the Loans, Agent shall have the
same rights and powers hereunder as any other Lender and may exercise the same
as though it were not performing the duties and functions delegated to it
hereunder, and the term "Lender" or "Lenders" or any similar term shall, unless
the context clearly otherwise indicates, include Agent in its individual
capacity. Agent and its Affiliates may accept deposits from, lend money to and
generally engage in any kind of banking, trust, financial advisory or other
business with Borrower or any of its Affiliates as if it were not performing the
duties specified herein, and may accept fees and other consideration from
Borrower for services in connection with this Agreement and otherwise without
having to account for the same to Lenders.
8.3 Representations and Warranties; No Responsibility For Appraisal of Credit
worthiness.
Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Borrower in
connection with the making of the Loans hereunder and that it has made and shall
continue to make its own appraisal of the creditworthiness of Borrower. Agent
shall not have any duty or responsibility, either initially or on a continuing
basis, to make any such investigation or any such appraisal on behalf of Lenders
or to provide any Lender with any credit or other information with respect
thereto,
669235.2
whether coming into its possession before the making of the Loans or at any time
or times thereafter, and Agent shall not have any responsibility with respect to
the accuracy of or the completeness of any information provided to Lenders.
8.4 Right to Indemnity.
Each Lender, in proportion to its Pro Rata Share, severally
agrees to indemnify Agent, to the extent that Agent shall not have been
reimbursed by Borrower, for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
(including counsel fees and disbursements) or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against Agent
in exercising its powers, rights and remedies or performing its duties hereunder
or under the other Loan Documents or otherwise in its capacity as Agent in any
way relating to or arising out of this Agreement or the other Loan Documents;
provided that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from Agent's gross negligence or willful
misconduct. If any indemnity furnished to Agent for any purpose shall, in the
opinion of Agent, be insufficient or become impaired, Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished.
8.5 Successor Agent.
Agent may resign at any time by giving 30 days' prior written
notice thereof to Lenders and Borrower, and Agent may be removed at any time
with or without cause by an instrument or concurrent instruments in writing
delivered to Borrower and Agent and signed by Requisite Lenders; provided that,
Agent hereby agrees that, unless an Event of Default has occurred and is
continuing, Agent will not resign unless Agent determines that a conflict of
interest exists. Upon any such notice of resignation or any such removal,
Requisite Lenders shall have the right, upon five Business Days' notice to
Borrower, to appoint a successor Agent. Upon the acceptance of any appointment
as Agent hereunder by a successor Agent, that successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring or removed Agent and the retiring or removed Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring or removed Agent's resignation or removal hereunder as Agent, the
provisions of this Section 8 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement.
8.6 Collateral Documents and Guaranties.
Each Lender hereby further authorizes Agent, on behalf of and
for the benefit of Lenders, to enter into each Collateral Document as secured
party, and each Lender agrees to be bound by the terms of each Collateral
Document; provided that Agent shall not (i) enter into or consent to any
material amendment, modification, termination or waiver of any
669235.2
provision contained in any Collateral Document or (ii) release any Collateral
(except as otherwise expressly permitted or required pursuant to the terms of
this Agreement or the applicable Collateral Document), in each case without the
prior consent of Requisite Lenders (or, if required pursuant to subsection 9.6,
all Lenders); provided further, however, that, without further written consent
or authorization from Lenders, Agent may execute any documents or instruments
necessary to release any Lien encumbering any item of Collateral that is the
subject of a sale or other disposition of assets permitted by this Agreement or
to which Requisite Lenders have otherwise consented. Anything contained in any
of the Loan Documents to the contrary notwithstanding, Borrower, Agent and each
Lender hereby agree that (X) no Lender shall have any right individually to
realize upon any of the Collateral under any Collateral Document, it being
understood and agreed that all powers, rights and remedies under the Collateral
Documents may be exercised solely by Agent for the benefit of Lenders in
accordance with the terms thereof, and (Y) in the event of a foreclosure by
Agent on any of the Collateral pursuant to a public or private sale, Agent or
any Lender may be the purchaser of any or all of such Collateral at any such
sale and Agent, as agent for and representative of Lenders (but not any Lender
or Lenders in its or their respective individual capacities unless Requisite
Lenders shall otherwise agree in writing) shall be entitled, for the purpose of
bidding and making settlement or payment of the purchase price for all or any
portion of the Collateral sold at any such public sale, to use and apply any of
the Obligations as a credit on account of the purchase price for any collateral
payable by Agent at such sale.
Section 9. MISCELLANEOUS
9.1 Assignments and Participations in Loans.
A. General. Subject to subsection 9.1B, each Lender shall have
the right at any time to sell, assign or transfer to any Eligible Assignee, or
(with the prior written consent of Agent) grant participations in, all or any
part of its Commitment or the Loans made by it or any other interest herein or
in any other Obligations owed to it; provided that no such sale, assignment,
transfer or participation shall, without the consent of Borrower, require
Borrower to file a registration statement with the Securities and Exchange
Commission or apply to qualify such sale, assignment, transfer or participation
under the securities laws of any state; and provided, further that no such sale,
assignment or transfer described in clause (i) above shall be effective unless
and until an Assignment Agreement effecting such sale, assignment or transfer
shall have been accepted by Agent and recorded in the Register as provided in
subsection 9.1B(ii). Except as otherwise provided in this subsection 9.1, no
Lender shall, as between Borrower and such Lender, be relieved of any of its
obligations hereunder as a result of any sale, assignment or transfer of all or
any part of its Commitment or the Loan or other Obligations owed to such Lender.
669235.2
B. Assignments.
(i) Amounts and Terms of Assignments. Each Commitment, Loan or
other Obligation may (a) be assigned in any amount to another Lender,
or to an Affiliate of the assigning Lender or another Lender, with the
giving of notice to Borrower and Agent or (b) be assigned in an
aggregate amount of not less than $________* (or such lesser amount as
shall constitute the aggregate amount of the Commitment, Loan and other
Obligations of the assigning Lender) to any other Eligible Assignee
with the giving of notice to Borrower and with the consent of Agent. To
the extent of any such assignment in accordance with either clause (a)
or (b) above, the assigning Lender shall be relieved of its obligations
with respect to its Commitment, Loan or other Obligations or the
portion thereof so assigned. The parties to each such assignment shall
execute and deliver to Agent, for its acceptance and recording in the
Register, an Assignment Agreement, together with a processing and
recordation fee of $3,500 and such forms, certificates or other
evidence, if any, with respect to United States federal income tax
withholding matters as the assignee under such Assignment Agreement may
be required to deliver to Agent pursuant to subsection 2.7B(iii)(a).
Upon such execution, delivery, acceptance and recordation, from and
after the effective date specified in such Assignment Agreement, (y)
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 Agreement, shall have the rights and obligations of a
Lender hereunder and (z) the assigning Lender thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment Agreement, relinquish its rights (other
than any rights which survive the termination of this Agreement under
subsection 9.9B) and be released from its obligations under this
Agreement (and, in the case of an Assignment Agreement covering all or
the remaining portion of an assigning Lender's rights and obligations
under this Agreement, such Lender shall cease to be a party hereto).
The Commitments hereunder shall be modified to reflect the Commitment
of such assignee and any remaining Commitment of such assigning Lender
and, if any such assignment occurs after the issuance of the Notes
hereunder, the assigning Lender shall, upon the effectiveness of such
assignment or as promptly thereafter as practicable, surrender its
Note, to Agent for cancellation, and thereupon new Notes shall be
issued to the assignee and/or to the assigning Lender, substantially in
the form of Exhibit III annexed hereto with appropriate insertions, to
reflect the outstanding Loans of the assignee and/or the assigning
Lender.
(ii) Acceptance by Agent; Recordation in Register. Upon its
receipt of an Assignment Agreement executed by an assigning Lender and
an assignee representing that it is an Eligible Assignee, together with
the processing and recordation fee referred to in subsection 9.1B(i)
and any forms, certificates or other evidence with respect to
--------
* Material omitted pursuant to a request for Confidential Treatment
and filed separately with the Commission.
669235.2
United States federal income tax withholding matters that such assignee
may be required to deliver to Agent pursuant to subsection
2.7B(iii)(a), Agent shall, if Agent has consented to the assignment
evidenced thereby (to the extent such consent is required pursuant to
subsection 9.1B(i)), (a) accept such Assignment Agreement by executing
a counterpart thereof as provided therein (which acceptance shall
evidence any required consent of Agent to such assignment), (b) record
the information contained therein in the Register, and (c) give prompt
notice thereof to Borrower. Agent shall maintain a copy of each
Assignment Agreement delivered to and accepted by it as provided in
this subsection 9.1B(ii).
C. Assignments to Federal Reserve Banks. In addition to the
assignments and participations permitted under the foregoing provisions of this
subsection 9.1, any Lender may assign and pledge all or any portion of its Loan,
the other Obligations owed to such Lender, and its Note to any Federal Reserve
Bank as collateral security pursuant to Regulation A of the Board of Governors
of the Federal Reserve System and any operating circular issued by such Federal
Reserve Bank; provided that (i) no Lender shall, as between Borrower and such
Lender, be relieved of any of its obligations hereunder as a result of any such
assignment and pledge and (ii) in no event shall such Federal Reserve Bank be
considered to be a "Lender" or be entitled to require the assigning Lender to
take or omit to take any action hereunder.
D. Information. Each Lender may furnish any information
concerning Borrower in the possession of that Lender from time to time to
assignees and participants (including prospective assignees and participants),
subject to subsection 9.19.
E. Representations of Lenders. Each Lender listed on the
signature pages hereof hereby represents and warrants (i) that it is an Eligible
Assignee described in clause (A) of the definition thereof; (ii) that it has
experience and expertise in the making of loans such as the Loans; and (iii)
that it will make its Loan for its own account in the ordinary course of its
business and without a view to distribution of such Loan within the meaning of
the Securities Act or the Exchange Act or other federal securities laws (it
being understood that, subject to the provisions of this subsection 9.1, the
disposition of such Loan or any interests therein shall at all times remain
within its exclusive control). Each Lender that becomes a party hereto pursuant
to an Assignment Agreement shall be deemed to agree that the representations and
warranties of such Lender contained in Section 2(c) of such Assignment Agreement
are incorporated herein by this reference.
9.2 Expenses.
Borrower agrees to pay promptly (i) all the actual and
reasonable costs and expenses incurred by Agent in connection with the
negotiation, preparation and execution of the Loan Documents and any consents,
amendments, waivers or other modifications thereto (other than any consents,
amendments, waivers or modifications requested solely by Lenders); (ii) all the
costs of furnishing all opinions by counsel for Borrower (including any opinions
669235.2
requested by Lenders as to any legal matters arising hereunder) and of
Borrower's performance of and compliance with all agreements and conditions on
its part to be performed or complied with under this Agreement and the other
Loan Documents; (iii) the reasonable fees, expenses and disbursements of counsel
to Agent (including allocated costs of internal counsel) in connection with the
negotiation, preparation, execution and administration of the Loan Docu ments
and any consents, amendments, waivers or other modifications thereto and any
other documents or matters requested by Borrower; and (iv) after the occurrence
of an Event of Default, all costs and expenses, including reasonable attorneys'
fees (including allocated costs of internal counsel) and costs of settlement,
incurred by Agent and Lenders in enforcing any Obligations of or in collecting
any payments due from Borrower hereunder or under the other Loan Documents by
reason of such Event of Default or in connection with any refinancing or
restructuring of the credit arrangements provided under this Agreement in the
nature of a "work-out" or pursuant to any insolvency or bankruptcy proceedings.
9.3 Indemnity.
In addition to the payment of expenses pursuant to subsection
9.2, whether or not the transactions contemplated hereby shall be consummated,
Borrower agrees to defend (subject to Indemnitees' selection of counsel),
indemnify, pay and hold harmless Agent and Lenders, and the officers, directors,
employees, agents and affiliates of Agent and Lenders (collectively called the
"Indemnitees"), from and against any and all Indemnified Liabilities (as
hereinafter defined); provided that Borrower shall not have any obligation to
any Indemnitee hereunder with respect to any Indemnified Liabilities to the
extent such Indemnified Liabilities arise solely from the gross negligence or
willful misconduct of that Indemnitee as determined by a final judgment of a
court of competent jurisdiction.
As used herein, "Indemnified Liabilities" means, collectively,
any and all liabilities, obligations, losses, damages (including natural
resource damages), penalties, actions, judgments, suits, claims, costs, expenses
and disbursements of any kind or nature whatsoever (including the reasonable
fees and disbursements of counsel for Indemnitees in connection with any
investigative, administrative or judicial proceeding commenced or threatened by
any Person, whether or not any such Indemnitee shall be designated as a party or
a potential party thereto, and any fees or expenses incurred by Indemnitees in
enforcing this indemnity), whether direct, indirect or consequential and whether
based on any federal, state or foreign laws, statutes, rules or regulations
(including securities and commercial laws, statutes, rules or regulations), on
common law or equitable cause or on contract or otherwise, that may be imposed
on, incurred by, or asserted against any such Indemnitee, in any manner relating
to or arising out of (i) this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby (including Lenders' agreement to
make the Loans hereunder or the use or intended use of the proceeds thereof, or
any enforcement of any of the Loan Documents (including any sale of, collection
from, or other realization upon any of the Collateral) and (ii) the statements
contained in the commitment letter delivered by any Lender to Borrower with
respect thereto.
669235.2
To the extent that the undertakings to defend, indemnify, pay
and hold harmless set forth in this subsection 9.3 may be unenforceable in whole
or in part because they are violative of any law or public policy, Borrower
shall contribute the maximum portion that it is permitted to pay and satisfy
under applicable law to the payment and satisfaction of all Indemnified
Liabilities incurred by Indemnitees or any of them.
9.4 Confidentiality.
The Agent and each Lender shall hold all non-public information
obtained pursuant to this Agreement, any other Loan Document or otherwise in
connection herewith or therewith which has been identified as confidential by
Borrower in accordance with the Agent's and such Lender's customary procedures
for handling confidential information of this nature and in accordance with safe
and sound banking practices, it being understood and agreed by Borrower that in
any event the Agent and a Lender may make disclosures to Affiliates of the Agent
or such Lender who are, or are expected to become, engaged in evaluating,
approving, structuring or administering the Loans or disclosures reasonably
required by any bona fide prospective assignee, transferee or participant in
connection with the contemplated assignment or transfer by such Lender of its
Loans or any participations therein or disclosures required or requested by any
governmental agency or representative thereof or pursuant to legal process;
provided that, unless specifically prohibited by applicable law or court order,
the Agent and each Lender shall notify Borrower of any request by any
governmental agency or repre sentative thereof (other than any such request in
connection with any examination of the financial condition of the Agent or such
Lender by such governmental agency) for disclosure of any such non-public
information prior to disclosure of such information; and provided, further that
in no event shall the Agent or any Lender be obligated or required to return any
materials furnished by Borrower or any of its Affiliates.
9.5 Ratable Sharing.
Lenders hereby agree among themselves that if any of them
shall, whether by voluntary payment (other than a voluntary prepayment of Loans
made and applied in accordance with the terms of this Agreement), by realization
upon security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, fees and other
amounts then due and owing to that Lender hereunder or under the other Loan
Documents (collectively, the "Aggregate Amounts Due" to such Lender) which is
greater than the proportion received by any other Lender in respect of the
Aggregate Amounts Due to such other Lender, then the Lender receiving such
proportionately greater payment shall (i) notify Agent and each other Lender of
the receipt of such payment and (ii) apply a portion of such payment to purchase
participations (which it shall be deemed to have purchased from each seller of a
participation simultaneously upon the receipt by such seller of its portion of
such payment) in the Aggregate Amounts Due to the other Lenders so that all such
recoveries of Aggregate Amounts Due shall
669235.2
be shared by all Lenders in proportion to the Aggregate Amounts Due to them;
provided that if all or part of such proportionately greater payment received by
such purchasing Lender is thereafter recovered from such Lender upon the
bankruptcy or reorganization of Borrower or otherwise, those purchases shall be
rescinded and the purchase prices paid for such partici pations shall be
returned to such purchasing Lender ratably to the extent of such recovery, but
without interest. Borrower expressly consents to the foregoing arrangement and
agrees that any holder of a participation so purchased may exercise any and all
rights of banker's lien, set-off or counterclaim with respect to any and all
monies owing by Borrower to that holder with respect thereto as fully as if that
holder were owed the amount of the participation held by that holder.
9.6 Amendments and Waivers.
No amendment, modification, termination or waiver of any
provision of this Agreement or of the Notes, and no consent to any departure by
Borrower therefrom, shall in any event be effective without the written
concurrence of Requisite Lenders; provided that any such amendment,
modification, termination, waiver or consent which: increases the amount of any
of the Commitments or reduces the principal amount of any of the Loans; changes
in any manner the definition of "Pro Rata Share" or the definition of "Requisite
Lenders"; changes in any manner any provision of this Agreement which, by its
terms, expressly requires the approval or concurrence of all Lenders; postpones
the scheduled final maturity date of any of the Loans; postpones the date on
which any interest or any fees are payable; decreases the interest rate borne by
any of the Loans (other than any waiver of any increase in the interest rate
applicable to any of the Loans pursuant to subsection 2.2E) or the amount of any
fees payable hereunder; increases the maximum duration of Interest Periods
permitted hereunder; or changes in any manner the provisions contained in
subsection 7.1 or this subsection 9.6 shall be effective only if evidenced by a
writing signed by or on behalf of all Lenders. In addition, (i) any amendment,
modification, termination or waiver of any of the provisions contained in
Section 3 shall be effective only if evidenced by a writing signed by or on
behalf of Agent and Requisite Lenders, (ii) no amendment, modification,
termination or waiver of any provision of any Note shall be effective without
the written concurrence of the Lender which is the holder of that Note, and
(iii) no amendment, modification, termination or waiver of any provision of
Section 8 or of any other provision of this Agreement which, by its terms,
expressly requires the approval or concurrence of Agent shall be effective
without the written concurrence of Agent. Agent may, but shall have no
obligation to, with the concurrence of any Lender, execute amendments,
modifications, waivers or consents on behalf of that Lender. Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given. No notice to or demand on Borrower in any case
shall entitle Borrower to any other or further notice or demand in similar or
other circumstances. Any amendment, modification, termination, waiver or consent
effected in accordance with this subsection 9.6 shall be binding upon each
Lender at the time outstanding, each future Lender and, if signed by Borrower,
on Borrower.
669235.2
9.7 Independence of Covenants.
All covenants hereunder shall be given independent effect so
that if a particular action or condition is not permitted by any of such
covenants, the fact that it would be permitted by an exception to, or would
otherwise be within the limitations of, another covenant shall not avoid the
occurrence of an Event of Default or Potential Event of Default if such action
is taken or condition exists.
9.8 Notices.
Unless otherwise specifically provided herein, any notice or
other communica tion herein required or permitted to be given shall be in
writing and may be personally served or sent by telefacsimile or United States
mail or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile, or three Business
Days after depositing it in the United States mail with postage prepaid and
properly addressed. For the purposes hereof, the address of each party hereto
shall be as set forth under such party's name on the signature pages hereof or
(i) as to Borrower and Agent, such other address as shall be designated by such
Person in a written notice delivered to the other parties hereto and (ii) as to
each other party, such other address as shall be designated by such party in a
written notice delivered to Agent.
9.9 Survival of Representations, Warranties and Agreements.
A. All representations, warranties and agreements made herein
shall survive the execution and delivery of this Agreement and the making of the
Loans hereunder.
B. Notwithstanding anything in this Agreement or implied by law
to the contrary, the agreements of Borrower set forth in subsections 2.6D, 2.7,
9.2 and 9.3 and the agreements of Lenders set forth in subsections 8.2C, 8.4 and
9.4 shall survive the payment of the Loans and the termination of this
Agreement.
9.10 Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of Agent or any Lender in the
exercise of any power, right or privilege hereunder or under any other Loan
Document shall impair such power, right or privilege or be construed to be a
waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
669235.2
9.11 Marshalling; Payments Set Aside.
Neither Agent nor any Lender shall be under any obligation to
marshal any assets in favor of Borrower or any other party or against or in
payment of any or all of the Obligations. To the extent that Borrower makes a
payment or payments to Agent or Lenders (or to Agent for the benefit of
Lenders), or Agent or Lenders enforce any security interests or exercise their
rights of setoff, and such payment or payments or the proceeds of such
enforcement or setoff or any part thereof are subsequently invalidated, declared
to be fraudu lent or preferential, set aside and/or required to be repaid to a
trustee, receiver or any other party under any bankruptcy law, any other state
or federal law, common law or any equitable cause, then, to the extent of such
recovery, the obligation or part thereof originally intended to be satisfied,
and all Liens, rights and remedies therefor or related thereto, shall be revived
and continued in full force and effect as if such payment or payments had not
been made or such enforcement or setoff had not occurred.
9.12 Severability.
In case any provision in or obligation under this Agreement or
the Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other juris diction,
shall not in any way be affected or impaired thereby.
9.13 Obligations Several; Independent Nature of Lenders' Rights.
The obligations of Lenders hereunder are several and no Lender
shall be responsible for the obligations or Commitments of any other Lender
hereunder. Nothing contained herein or in any other Loan Document, and no action
taken by Lenders pursuant hereto or thereto, shall be deemed to constitute
Lenders as a partnership, an association, a joint venture or any other kind of
entity. The amounts payable at any time hereunder to each Lender shall be a
separate and independent debt, and each Lender shall be entitled to protect and
enforce its rights arising out of this Agreement and it shall not be necessary
for any other Lender to be joined as an additional party in any proceeding for
such purpose.
9.14 Headings.
Section and subsection headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
9.15 Applicable Law.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE
669235.2
OF NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS
LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES.
9.16 Successors and Assigns.
This Agreement shall be binding upon the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
parties hereto and the successors and assigns of Lenders (it being understood
that Lenders' rights of assignment are subject to subsection 9.1). Neither
Borrower's rights or obligations hereunder nor any interest therein may be
assigned or delegated by Borrower without the prior written consent of all
Lenders.
9.17 Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST BORROWER ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇. BY EXECUTING AND
DELIVERING THIS AGREEMENT, BORROWER, FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING
IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO BORROWER AT ITS ADDRESS PROVIDED IN ACCORDANCE
WITH SUBSECTION 9.8;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III)
ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER
BORROWER IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND
OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN
EVERY RESPECT;
(V) AGREES THAT LENDERS RETAIN THE RIGHT TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING
PROCEEDINGS AGAINST BORROWER IN THE COURTS OF ANY OTHER
JURISDICTION; AND
669235.2
(VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 9.17
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO
THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1402 OR OTHERWISE.
9.18 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY
DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR
THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope
of this waiver is intended to be all-encompassing of any and all disputes that
may be filed in any court and that relate to the subject matter of this
transaction, including contract claims, tort claims, breach of duty claims and
all other common law and statutory claims. Each party hereto acknowledges that
this waiver is a material inducement to enter into a business relationship, that
each has already relied on this waiver in entering into this Agreement, and that
each will continue to rely on this waiver in their related future dealings. Each
party hereto further warrants and represents that it has reviewed this waiver
with its legal counsel and that it knowingly and voluntarily waives its jury
trial rights following consultation with legal counsel. THIS WAIVER IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING
(OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION
9.18 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO
ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR
AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER. In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.
9.19 Counterparts; Effectiveness.
This Agreement and any amendments, waivers, consents or
supplements hereto or in connection herewith may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Borrower and
Agent of written or telephonic notification of such execution and authorization
of delivery thereof.
669235.2
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669235.2
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
▇▇▇▇▇ II REALTY TRUST, INC.
By: /s/▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------
Title: Vice President
---------------------------------
Notice Address:
c/o Apollo Real Estate Advisors, L.P.
1301 Avenue of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
BANKERS TRUST COMPANY,
individually and as Agent
By: /s/
---------------------------------
Title: Managing Director
---------------------------------
Notice Address:
Bankers Trust Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
NY-482732
CREDIT AGREEMENT
CREDIT AGREEMENT
DATED AS OF FEBRUARY 27, 1997
AMONG
▇▇▇▇▇ II REALTY TRUST, INC.
as Borrower,
THE LENDERS LISTED HEREIN,
as Lenders,
and
BANKERS TRUST COMPANY,
as Agent
▇▇▇▇▇ II REALTY TRUST, INC.
CREDIT AGREEMENT
TABLE OF CONTENTS
Page
Section 1. DEFINITIONS................................................................................ 1
1.1 Certain Defined Terms...................................................................... 1
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations
Under Agreement............................................................................ 13
1.3 Other Definitional Provisions and Rules of Construction.................................... 14
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS................................................. 14
2.1 Commitments; Making of Loans; the Register; Notes.......................................... 14
2.2 Interest on the Loans...................................................................... 17
2.3 Fees....................................................................................... 19
2.4 Repayments and Prepayments; General Provisions Regarding
Payments................................................................................. 19
2.5 Use of Proceeds............................................................................ 21
2.6 Special Provisions Governing LIBOR Rate Loans.............................................. 22
2.7 Increased Costs; Taxes; Capital Adequacy................................................... 24
Section 3. CONDITIONS TO LOANS........................................................................ 28
3.1 Conditions to Initial Loans................................................................ 28
3.2 Conditions to All Loans.................................................................... 30
Section 4. BORROWER'S REPRESENTATIONS AND WARRANTIES.................................................. 32
4.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries............................................................................... 32
4.2 Authorization of Borrowing, etc............................................................ 32
4.3 Financial Condition........................................................................ 33
4.4 No Material Adverse Change; No Restricted Junior Payments.................................. 34
4.5 Title to Properties; Liens................................................................. 34
4.6 Litigation; Adverse Facts.................................................................. 34
4.7 Payment of Taxes; Classification for Tax Purposes.......................................... 34
4.8 Performance of Agreements; Materially Adverse Agreements; Material
Contracts and Related Agreements........................................................... 35
4.9 Governmental Regulation.................................................................... 35
4.10 Securities Activities...................................................................... 35
4.11 Employee Benefit Plans..................................................................... 35
4.12 Certain Fees............................................................................... 36
4.13 Employee Matters........................................................................... 36
4.14 Solvency................................................................................... 36
(i)
Page
4.15 ▇▇▇▇▇ Common Stock......................................................................... 36
4.16 Disclosure................................................................................. 36
Section 5. BORROWER'S AFFIRMATIVE COVENANTS........................................................... 37
5.1 Financial Statements and Other Reports..................................................... 37
5.2 Existence; Separateness.................................................................... 40
5.3 Payment of Taxes and Claims; Classification for Tax Purposes............................... 41
5.4 Inspection................................................................................. 42
5.5 Compliance with Laws, etc.................................................................. 42
5.6 Further Assurances......................................................................... 42
Section 6. BORROWER'S NEGATIVE COVENANTS.............................................................. 42
6.1 Indebtedness............................................................................... 42
6.2 Liens and Related Matters.................................................................. 43
6.3 Investments................................................................................ 43
6.4 Contingent Obligations..................................................................... 44
6.5 Restricted Junior Payments................................................................. 44
6.6 Restriction on Fundamental Changes; Asset Sales and Acquisitions........................... 44
6.7 Transactions with Shareholders and Affiliates.............................................. 44
6.8 Conduct of Business; Incurrence of Liabilities............................................. 45
6.9 Amendment of Certain Related Agreements.................................................... 45
6.10 Fiscal Year................................................................................ 45
Section 7. EVENTS OF DEFAULT.......................................................................... 45
7.1 Failure to Make Payments When Due.......................................................... 45
7.2 Default in Other Obligations............................................................... 45
7.3 Breach of Certain Covenants................................................................ 45
7.4 Breach of Warranty......................................................................... 46
7.5 Other Defaults Under Loan Documents........................................................ 46
7.6 Involuntary Bankruptcy; Appointment of Receiver, etc....................................... 46
7.7 Voluntary Bankruptcy; Appointment of Receiver, etc......................................... 46
7.8 Judgments and Attachments.................................................................. 47
7.9 Dissolution................................................................................ 47
7.10 Employee Benefit Plans ................................................................. 47
7.11 Failure to Qualify as a REIT............................................................... 47
7.12 Failure of Security; Repudiation of Obligations............................................ 47
7.13 Amendment of Certain Related Agreements.................................................... 48
7.14 Listing on National Securities Exchange.................................................... 48
Section 8. AGENT...................................................................................... 49
8.1 Appointment................................................................................ 49
8.2 Powers and Duties; General Immunity........................................................ 49
(ii)
Page
8.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness........................................................................... 51
8.4 Right to Indemnity......................................................................... 51
8.5 Successor Agent............................................................................ 51
8.6 Collateral Documents and Guaranties........................................................ 52
Section 9. MISCELLANEOUS.............................................................................. 53
9.1 Assignments and Participations in Loans.................................................... 53
9.2 Expenses................................................................................... 55
9.3 Indemnity.................................................................................. 55
9.4 Confidentiality............................................................................ 56
9.5 Ratable Sharing............................................................................ 57
9.6 Amendments and Waivers..................................................................... 57
9.7 Independence of Covenants.................................................................. 58
9.8 Notices.................................................................................... 58
9.9 Survival of Representations, Warranties and Agreements..................................... 59
9.10 Failure or Indulgence Not Waiver; Remedies Cumulative...................................... 59
9.11 Marshalling; Payments Set Aside............................................................ 59
9.12 Severability............................................................................... 60
9.13 Obligations Several; Independent Nature of Lenders' Rights................................. 60
9.14 Headings................................................................................... 60
9.15 Applicable Law............................................................................. 60
9.16 Successors and Assigns..................................................................... 60
9.17 Consent to Jurisdiction and Service of Process............................................. 61
9.18 Waiver of Jury Trial....................................................................... 61
9.19 Counterparts; Effectiveness................................................................ 62
Signature pages ....................................................................... S-1
(iii)
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONTINUATION
III FORM OF NOTE
IV FORM OF OPINION OF BORROWER'S COUNSEL
V FORM OF OPINION OF O'MELVENY & ▇▇▇▇▇ LLP
VI FORM OF ASSIGNMENT AGREEMENT
VII FORM OF CERTIFICATE RE NON-BANK STATUS
VIII FORM OF PLEDGE AGREEMENT
(iv)
SCHEDULES
2.1 LENDERS' COMMITMENTS AND PRO RATA SHARES
4.8 MATERIAL CONTRACTS
(v)