EXHIBIT 10.45
$600,000,000
CREDIT AGREEMENT
DATED AS OF OCTOBER 26, 2004
AMONG
TECHNICAL OLYMPIC USA, INC.,
AS BORROWER
AND
THE LENDERS AND ISSUERS PARTY HERETO
AND
CITICORP NORTH AMERICA, INC.,
AS ADMINISTRATIVE AGENT,
DEUTSCHE BANK SECURITIES INC.,
AS SYNDICATION AGENT,
KEYBANK NATIONAL ASSOCIATION AND ▇.▇. ▇▇▇▇▇▇ SECURITIES INC.,
AS CO-DOCUMENTATION AGENTS,
AND
CITIGROUP GLOBAL MARKETS INC.
AND
DEUTSCHE BANK SECURITIES INC.
AS JOINT LEAD ARRANGERS AND JOINT BOOK MANAGERS
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS, INTERPRETATION AND ACCOUNTING TERMS
SECTION 1.1 Defined Terms..............................................................................1
SECTION 1.2 Computation of Time Periods...............................................................22
SECTION 1.3 Accounting Terms and Principles...........................................................22
SECTION 1.4 Certain Terms.............................................................................22
ARTICLE II
THE FACILITY
SECTION 2.1 The Revolving Credit Commitments..........................................................23
SECTION 2.2 Borrowing Procedures......................................................................23
SECTION 2.3 Swing Loans...............................................................................24
SECTION 2.4 Letters of Credit.........................................................................26
SECTION 2.5 Reduction and Termination of the Revolving Credit Commitments.............................30
SECTION 2.6 Repayment of Loans........................................................................30
SECTION 2.7 Evidence of Debt..........................................................................30
SECTION 2.8 Prepayments...............................................................................30
SECTION 2.9 Interest..................................................................................31
SECTION 2.10 Conversion/Continuation Option............................................................32
SECTION 2.11 Fees......................................................................................32
SECTION 2.12 Payments and Computations.................................................................33
SECTION 2.13 Special Provisions Governing Eurodollar Rate Loans........................................35
SECTION 2.14 Capital Adequacy..........................................................................37
SECTION 2.15 Taxes.....................................................................................37
SECTION 2.16 Substitution of Lenders...................................................................39
SECTION 2.17 Facility Extension........................................................................40
SECTION 2.18 Facility Increase.........................................................................41
ARTICLE III
CONDITIONS TO LOANS AND LETTERS OF CREDIT
SECTION 3.1 Conditions Precedent to the Effectiveness of this Agreement...............................42
SECTION 3.2 Conditions Precedent to Each Loan and Letter of Credit....................................43
SECTION 3.3 Determinations of Initial Borrowing Conditions............................................44
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.1 Corporate Existence; Compliance with Law..................................................45
SECTION 4.2 Corporate Power; Authorization; Enforceable Obligations...................................45
SECTION 4.3 Ownership of Borrower; Subsidiaries.......................................................46
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SECTION 4.4 Financial Statements......................................................................46
SECTION 4.5 Material Adverse Change...................................................................47
SECTION 4.6 Litigation................................................................................47
SECTION 4.7 Taxes.....................................................................................47
SECTION 4.8 Full Disclosure...........................................................................47
SECTION 4.9 Margin Regulations........................................................................48
SECTION 4.10 No Burdensome Restrictions; No Defaults...................................................48
SECTION 4.11 Investment Company Act; Public Utility Holding Company Act................................48
SECTION 4.12 Use of Proceeds...........................................................................48
SECTION 4.13 Insurance.................................................................................48
SECTION 4.14 Labor Matters.............................................................................49
SECTION 4.15 ERISA.....................................................................................49
SECTION 4.16 Environmental Matters.....................................................................49
SECTION 4.17 Intellectual Property.....................................................................49
SECTION 4.18 Title; Real Property......................................................................50
SECTION 4.19 Anti-Terrorism Laws.......................................................................50
ARTICLE V
FINANCIAL COVENANTS
SECTION 5.1 Adjusted Consolidated Tangible Net Worth..................................................51
SECTION 5.2 Maximum Indebtedness to Adjusted Consolidated Tangible Net Worth Ratio....................51
SECTION 5.3 Minimum Interest Coverage Ratio...........................................................51
SECTION 5.4 Unsold Land to Adjusted Consolidated Tangible Net Worth...................................51
SECTION 5.5 Unsold Units to Units Closed..............................................................52
ARTICLE VI
AFFIRMATIVE COVENANTS
SECTION 6.1 Reporting Requirements....................................................................52
SECTION 6.2 Preservation of Corporate Existence, Etc..................................................55
SECTION 6.3 Compliance with Laws, Etc.................................................................55
SECTION 6.4 Conduct of Business.......................................................................55
SECTION 6.5 Payment of Taxes, Etc.....................................................................55
SECTION 6.6 Maintenance of Insurance..................................................................55
SECTION 6.7 Transactions with Affiliates..............................................................55
SECTION 6.8 Access....................................................................................56
SECTION 6.9 Keeping of Books..........................................................................56
SECTION 6.10 Maintenance of Properties, Etc............................................................56
SECTION 6.11 Application of Proceeds...................................................................56
SECTION 6.12 Environmental.............................................................................56
SECTION 6.13 Additional Guaranties.....................................................................57
SECTION 6.14 Designation of Restricted and Unrestricted Subsidiaries...................................57
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ARTICLE VII
NEGATIVE COVENANTS
SECTION 7.1 Liens, Etc................................................................................59
SECTION 7.2 Investments...............................................................................59
SECTION 7.3 Restricted Payments.......................................................................60
SECTION 7.4 Restriction on Fundamental Changes........................................................61
SECTION 7.5 Change in Nature of Business..............................................................61
SECTION 7.6 Transactions with Affiliates..............................................................61
SECTION 7.7 Restrictions on Subsidiary Distributions; No New Negative Pledge..........................62
SECTION 7.8 Sale/Leasebacks...........................................................................62
SECTION 7.9 Compliance with ERISA.....................................................................62
SECTION 7.10 Environmental.............................................................................62
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1 Events of Default.........................................................................62
SECTION 8.2 Remedies..................................................................................64
SECTION 8.3 Actions in Respect of Letters of Credit...................................................64
SECTION 8.4 Rescission................................................................................65
ARTICLE IX
THE ADMINISTRATIVE AGENT
SECTION 9.1 Authorization and Action..................................................................65
SECTION 9.2 Administrative Agent's Reliance, Etc......................................................66
SECTION 9.3 The Administrative Agent Individually.....................................................66
SECTION 9.4 Lender Credit Decision....................................................................66
SECTION 9.5 Indemnification...........................................................................67
SECTION 9.6 Successor Administrative Agent............................................................67
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Amendments, Waivers, Etc..................................................................68
SECTION 10.2 Assignments and Participations............................................................69
SECTION 10.3 Costs and Expenses........................................................................72
SECTION 10.4 Indemnities...............................................................................72
SECTION 10.5 Limitation of Liability...................................................................74
SECTION 10.6 Right of Set-off..........................................................................74
SECTION 10.7 Sharing of Payments, Etc..................................................................74
SECTION 10.8 Notices, Etc..............................................................................75
SECTION 10.9 No Waiver; Remedies.......................................................................76
SECTION 10.10 Binding Effect............................................................................76
SECTION 10.11 Governing Law.............................................................................76
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SECTION 10.12 Submission to Jurisdiction; Service of Process............................................76
SECTION 10.13 Waiver of Jury Trial......................................................................77
SECTION 10.14 Section Titles............................................................................77
SECTION 10.15 Execution in Counterparts.................................................................77
SECTION 10.16 Entire Agreement..........................................................................77
SECTION 10.17 Confidentiality...........................................................................77
SECTION 10.18 USA Patriot Act...........................................................................78
SECTION 10.19 Agent Communications......................................................................78
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SCHEDULES
Schedule I - Revolving Credit Commitments
Schedule II - Applicable Lending Offices and Addresses for Notices
Schedule 2.4 - Existing Letters of Credit
Schedule 4.2 - Consents
Schedule 4.3 - Ownership of Subsidiaries
Schedule 4.4 - Material Obligations
Schedule 4.6 - Litigation
Schedule 4.7 - Taxes
Schedule 4.13 - Insurance
Schedule 7.1 - Existing Liens
Schedule 7.2 - Existing Investments
Schedule 7.7 - Restrictions on Subsidiary Distributions
EXHIBITS
Exhibit A - Form of Assignment and Acceptance
Exhibit B - Form of Assumption Agreement
Exhibit C - Form of Revolving Credit Note
Exhibit D - Form of Notice of Borrowing
Exhibit E - Form of Borrowing Base Certificate
Exhibit F - Form of Notice of Conversion or Continuation
Exhibit G - Form of Opinion of Counsel for the Loan Parties
Exhibit H - Form of Guaranty
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CREDIT AGREEMENT (this "AGREEMENT"), dated as of October 26,
2004, among TECHNICAL OLYMPIC USA, INC., a Delaware corporation (the
"BORROWER"), the Lenders (as defined below), the Issuers (as defined below),
CITICORP NORTH AMERICA, INC. ( "CNAI"), as agent for the Lenders and the Issuers
(in such capacity, the "ADMINISTRATIVE AGENT"), DEUTSCHE BANK SECURITIES INC.,
as syndication agent (in such capacity, the "SYNDICATION AGENT") and KEYBANK
NATIONAL ASSOCIATION and ▇.▇. ▇▇▇▇▇▇ SECURITIES INC., as co-documentation agents
(in such capacity, the "CO-DOCUMENTATION AGENTS").
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS, INTERPRETATION AND ACCOUNTING TERMS
SECTION 1.1 DEFINED TERMS.
As used in this Agreement, the following terms have the
following meanings (such meanings to be equally applicable to both the singular
and plural forms of the terms defined):
"ADJUSTED CONSOLIDATED TANGIBLE NET WORTH" means with respect
to the Borrower and its Restricted Subsidiaries on a Consolidated basis, as of
any date, the sum of (a) Tangible Net Worth, PLUS (b) the lesser of (i) fifty
percent (50%) of the aggregate principal amount of all then outstanding
Subordinated Indebtedness of the Borrower and its Restricted Subsidiaries having
a maturity date later than one year following the Scheduled Termination Date,
(ii) twenty percent (20%) of Tangible Net Worth, and (iii) $200,000,000.
"ADMINISTRATIVE AGENT" has the meaning assigned to such term
in the preamble to this Agreement.
"AFFILIATE" means, with respect to any Person, any other
Person which, directly or indirectly, controls, is controlled by or is under
common control with such Person, each officer, director, general partner or
joint-venturer of such Person, and each Person who is the beneficial owner of
10% or more of any class of Voting Stock of such Person. For the purposes of
this definition, "CONTROL" means the possession of the power to direct or cause
the direction of management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. For purposes of
Section 7.6, Affiliate of the Borrower shall include Unrestricted Subsidiaries
of the Borrower and Joint Ventures of the Borrower.
"AGREEMENT" has the meaning assigned to such term in the
preamble hereto.
"ANTI-TERRORISM LAWS" has the meaning assigned to such term in
Section 4.19.
"APPLICABLE LENDING OFFICE" means, with respect to each
Lender, its Domestic Lending Office in the case of a Base Rate Loan, and its
Eurodollar Lending Office in the case of a Eurodollar Rate Loan.
"APPLICABLE MARGIN" means, as of any date of determination, a
PER ANNUM rate equal to the rate set forth below for the applicable type of Loan
or Letters of Credit and the Leverage Ratio and Ratings set forth below for each
such date of determination:
================= =========================== ========================== =============== =============== ================
LEVEL LEVERAGE RATIO RATINGS EURODOLLAR BASE RATE LETTERS OF
RATE LOANS LOANS CREDIT
----------------- --------------------------- -------------------------- --------------- --------------- ----------------
1 Less than or equal to 1.0 Ba1/BB+ or higher 1.50% -0- 1.25%
----------------- --------------------------- -------------------------- --------------- --------------- ----------------
2 Greater than 1.0 but less Ba2/BB 1.60% 0.10% 1.40%
than or equal to 1.25
----------------- --------------------------- -------------------------- --------------- --------------- ----------------
3 Greater than 1.25 but Ba3/BB- 1.70% 0.20% 1.50%
less than or equal to 1.50
----------------- --------------------------- -------------------------- --------------- --------------- ----------------
4 Greater than 1.50 but B1/B+ 1.80% 0.30% 1.55%
less than or equal to 1.75
----------------- --------------------------- -------------------------- --------------- --------------- ----------------
5 Greater than 1.75 B2/B or lower 2.00% 0.50% 1.70%
================= =========================== ========================== =============== =============== ================
For purposes of the above grid, "RATINGS" means (i) at any
time at which ▇▇▇▇▇'▇, S&P and Fitch all publicly announce ratings of the
Borrower's senior unsecured non-credit enhanced long-term debt, the second
highest of such three ratings and (ii) at any time at which ▇▇▇▇▇'▇ and S&P
publicly announce ratings of the Borrower's senior unsecured non-credit enhanced
long-term debt but Fitch does not, the higher of such two ratings (i.e., lower
pricing). "LEVERAGE RATIO" means, for the Borrower and its Restricted
Subsidiaries, as of the last day of each fiscal quarter, the ratio of (a) the
difference between (i) the aggregate amount of all Indebtedness of the Borrower
and its Restricted Subsidiaries and (ii) Unrestricted Cash in excess of
$10,000,000 and (b) the Adjusted Consolidated Tangible Net Worth of the Borrower
and its Restricted Subsidiaries.
In the case of the Leverage Ratio, the Applicable Margin shall
be determined upon delivery of the Compliance Certificate pursuant to Section
6.1(c), after the end of each fiscal quarter, commencing with the Compliance
Certificate delivered for the fiscal quarter ending June 30, 2004. The
Applicable Margin shall automatically be adjusted to the rate corresponding to
the Leverage Ratio set forth in the grid above. Such automatic adjustment shall
take effect on the last day that the Compliance Certificate was required to be
delivered, and shall remain in effect until subsequently adjusted in accordance
herewith upon the delivery of each such subsequent Compliance Certificate. In
the case of the Ratings, the Applicable Margin shall be determined upon any
change in such Ratings. The Applicable Margin shall automatically be adjusted to
the rate corresponding to the Ratings set forth in the grid above. Such
automatic adjustment shall take effect (i) in case of Eurodollar Rate Loans, as
of the beginning of the next succeeding applicable Interest Period for
Eurodollar Loans, and (ii) in case of Base Rate Loans, as of the next Business
Day following the date of such change in the Ratings.
In the event of a difference of one level between (x) the
Ratings and the Leverage Ratio pricing levels, or (y) the Ratings, the lower
pricing shall apply. In the event such difference is of more than one level
between (x) the Ratings and the Leverage Ratio and (y) the Ratings, the level
one level lower than the higher level pricing shall apply. Initially, the
Applicable Margin shall be set at Level 3.
"APPLICABLE UNUSED COMMITMENT FEE RATE" means, as of any date
of determination, a PER ANNUM rate equal to the corresponding Unused Commitment
Percentage set forth below:
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===================================== ==========================================
UNUSED COMMITMENT PERCENTAGE UNUSED COMMITMENT FEE RATE
------------------------------------- ------------------------------------------
Higher than 66 2/3% 0.35%
------------------------------------- ------------------------------------------
Higher than 33 1/3% and lower
than or equal to 66 2/3% 0.25%
------------------------------------ ------------------------------------------
Lower than or equal to 33 1/3% 0.15%
===================================== ==========================================
"APPROVED FUND" means, with respect to any Fund that is a fund
that invests in bank loans, any other fund that invests in bank loans and is
advised or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an
entity or Affiliate of an entity that administers or manages a Lender.
"ARRANGERS" means Citigroup Global Markets Inc. and Deutsche
Bank Securities Inc., in their capacities as joint lead arrangers and joint book
managers.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Administrative Agent, in substantially the form of EXHIBIT A.
"ASSUMPTION AGREEMENT" means an assumption agreement entered
into by a Lender or an Eligible Assignee, and accepted by the Administrative
Agent, substantially in the form of EXHIBIT B.
"AVAILABLE CREDIT" means, at any time, an amount equal to (a)
the Maximum Credit, MINUS (b) the aggregate Revolving Credit Outstandings at
such time.
"BANKRUPTCY CODE" means ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, as
amended from time to time.
"BASE RATE" means the greater of (i) the interest rate PER
ANNUM announced from time to time by the Administrative Agent at its Domestic
Lending Office as its then base rate, or (ii) the Federal Funds Rate plus 0.5%
PER ANNUM.
"BASE RATE LOAN" means any Loan during any period in which it
bears interest based on the Base Rate.
"BOARD OF DIRECTORS" means the board of directors of the
Borrower or any committee thereof authorized with respect to any particular
matter to exercise the power of the board of directors of the Borrower.
"BORROWING" means a borrowing consisting of Loans made on the
same day by the Lenders ratably according to their respective Revolving Credit
Commitments.
"BORROWING BASE" means, at any time, the sum of:
(a) the product of (x) 0.50 and (y) the Unimproved Land owned
by the Borrower or any Restricted Subsidiary;
(b) the product of (x) 0.65 and (y) the Land/Lots Under
Development owned by the Borrower or any Restricted Subsidiary;
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(c) the product of (x) 0.65 and (y) the Finished Lots owned by
the Borrower or any Restricted Subsidiary;
(d) the product of (x) 0.80 and (y) the Unsold Homes Under
Construction owned by the Borrower or any Restricted Subsidiary;
(e) the product of (x) 0.80 and (y) the Completed Unsold Homes
owned by the Borrower or any Restricted Subsidiary;
(f) the product (x) 0.90 and (y) the Sold Homes owned by the
Borrower and any Restricted Subsidiary; and
(g) the product of (x) 1.00 and (y) the sum of (a) Escrow
Proceeds Receivables and (b) Unrestricted Cash in excess of
$10,000,000;
PROVIDED, HOWEVER, that (i) at no time shall more than 25% of the Borrowing Base
be comprised of Unimproved Land, (ii) all assets of the Borrower and the
Restricted Subsidiaries included in the Borrowing Base shall not be subject to
any Lien (other than Customary Permitted Liens) and shall be owned 100% by the
Borrower or a Restricted Subsidiary, and (iii) (x) during the period beginning
on the Effective Date and ending on the first anniversary of the Effective Date,
no more than 55% of the Borrowing Base shall be comprised of Land/Lots Under
Development and Finished Lots and (y) thereafter no more than 50% of the
Borrowing Base shall be comprised of Land/Lots Under Development and Finished
Lots.
"BORROWING BASE ASSETS" means the Unimproved Land, Land/Lots
Under Development, Finished Lots, Unsold Homes Under Construction, Completed
Unsold Homes, Sold Homes, Escrow Proceeds Receivables and Unrestricted Cash in
excess of $10,000,000 included in the calculation of the Borrowing Base.
"BORROWING BASE CERTIFICATE" means a certificate of the
Borrower substantially in the form of EXHIBIT F.
"BUSINESS DAY" means a day of the year on which banks are not
required or authorized to close in New York City and, if the applicable Business
Day relates to notices, determinations, fundings and payments in connection with
the Eurodollar Rate or any Eurodollar Rate Loans, a day on which dealings in
Dollar deposits are also carried on in the London interbank market.
"CAPITAL LEASE" means, with respect to any Person, any lease
of, or other arrangement conveying the right to use, property by such Person as
lessee that would be accounted for as a capital lease on a balance sheet of such
Person prepared in conformity with GAAP.
"CAPITAL LEASE OBLIGATIONS" means, with respect to any Person,
the capitalized amount of all obligations of such Person or any of its
Restricted Subsidiaries under Capital Leases, as determined on a Consolidated
basis in conformity with GAAP.
"CASH EQUIVALENTS" means
(a) securities issued or fully guaranteed or insured by the
United States government or any agency thereof,
(b) certificates of deposit, eurodollar time deposits,
overnight bank deposits and bankers' acceptances of any commercial bank
organized under the laws of the United States, any state thereof, the
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District of Columbia, any foreign bank, or its branches or agencies
(fully protected against currency fluctuations) which, at the time of
acquisition, are rated at least "A-1" by S&P or "P-1" by ▇▇▇▇▇'▇,
(c) commercial paper of an issuer rated at least "A-1" by S&P,
"P-1" by ▇▇▇▇▇'▇, or "1" by the National Association of Investors
Corporation;
(d) short term repurchase agreements, municipal trusts and
obligations with a term of not more than 30 days for underlying
securities of the types described in clause (a) above entered into with
any bank meeting the qualifications specified in clause (b) above; and
(e) shares of any money market fund that (i) has at least 95%
of its assets invested continuously in the types of investments
referred to in CLAUSES (A), (B), (C), and (D) above, (ii) has net
assets of not less than $500,000,000 and (iii) is rated at least "A-1"
by S&P, "P-1" by ▇▇▇▇▇'▇, or "1" by the National Association of
Investors Corporation; PROVIDED, HOWEVER, that the maturities of all
obligations of the type specified in CLAUSES (A), (B), (C) and (D)
above shall not exceed 180 days.
"CHANGE OF CONTROL" means the occurrence of any of the
following events:
(a) if any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act or any successor
provisions to either of the preceding), including any group acting for
the purpose of acquiring, holding, voting or disposing of securities
within the meaning of Rule 13d-5(b)(1) under the Exchange Act, other
than any one or more of the Permitted Holders, becomes the "beneficial
owner," directly or indirectly, of 40% or more of the total voting
power of the Voting Stock of the Borrower; or
(b) if any of the Permitted Holders or any Person controlling
or under common control with the Permitted Holders, either individually
or acting together, becomes the "beneficial owner," directly or
indirectly, of 75% or more of the total voting power of the Voting
Stock of the Borrower; or
(c) during any period of two consecutive years, individuals
who at the beginning of such period constituted the board of directors
of the Borrower (together with any new directors whose election or
appointment by such board of directors or whose nomination for election
by the shareholders of the Borrower was approved by a vote of not less
than two-thirds of the directors then still in office who were either
directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any
reason to constitute a majority of the board of directors of the
Borrower then in office; or
(d) the shareholders of the Borrower shall have approved any
plan of liquidation or dissolution of the Borrower; or if the shares of
the Borrower cease to be listed on the New York Stock Exchange,
American Stock Exchange or Nasdaq National Market System for any
reason; or
(e) ▇▇▇▇▇▇▇ ▇. Mon (or a successor approved by the Requisite
Lenders) shall no longer be the chief executive officer of the
Borrower, and a successor chief executive officer satisfactory to the
Requisite Lenders shall not have (i) been appointed to such office
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within 120 days of the date on which ▇▇▇▇▇▇▇ ▇. Mon (or his approved
successor) ceased to be the chief executive officer of the Borrower and
(ii) assumed such office within 180 days of such date; or
(f) any "change of control" as defined in the indentures
governing the Senior Notes or Subordinated Notes has occurred.
For the purposes of this definition of "Change of Control,"
the term "beneficial owner" shall be as defined in Rule 13d-3 under the Exchange
Act, except that a person will be deemed to have "beneficial ownership" of all
shares that any such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time. For the purposes of
clauses (a) and (b) of this definition of "Change of Control," a person or group
shall be deemed to beneficially own any Voting Stock of a corporation held by
any other corporation (the "parent corporation") so long as such person or group
beneficially owns, directly or indirectly, in the aggregate a majority of the
total voting power of the Voting Stock of such parent corporation.
"CITIBANK" means Citibank, N.A., a national banking
association.
"CNAI" has the meaning assigned to such term in the preamble
to this Agreement.
"CODE" means the Internal Revenue Code of 1986 (or any
successor legislation thereto), as amended from time to time.
"COMMUNICATIONS" has the meaning assigned to such term in
Section 10.19.
"COMPLETED UNSOLD HOMES" means, as of any date, all Units
(including all Model Homes), for which construction has been "completed", but
for which there is in existence no written Contract for Sale, the value of which
is determined in conformity with GAAP. Construction will be considered
"completed" when a temporary certificate of occupancy or a certificate of
occupancy has been issued.
"COMPLIANCE CERTIFICATE" has the meaning assigned to such term
in Section 6.1(c).
"CONSOLIDATED" means, with respect to any Person, the
consolidation of accounts of such Person and its Subsidiaries or Restricted
Subsidiaries, as the case may be, in conformity with GAAP.
"CONSOLIDATED NET INCOME" means, for any Person for any
period, the net income (or loss) of such Person and its Restricted Subsidiaries
for such period, determined on a Consolidated basis in conformity with GAAP.
"CONSTITUENT DOCUMENTS" means, with respect to any Person, (a)
the articles of incorporation, certificate of incorporation or certificate of
formation (or the equivalent organizational documents) of such Person, (b) the
by-laws or operating agreement (or the equivalent governing documents) of such
Person and (c) any document setting forth the manner of election and duties of
the directors or managing members of such Person (if any) and the designation,
amount or relative rights, limitations and preferences of any class or series of
such Person's Stock.
"CONTAMINANT" means any material, substance, chemical,
constituent, waste, contaminant or pollutant, including, without limitation, any
petroleum or petroleum-derived substance or waste, asbestos and polychlorinated
biphenyls regulated or which can give rise to liability under any Environmental
Law.
"CONTRACT FOR SALE" means a sale and purchase agreement for a
Unit between the Borrower or any Restricted Subsidiary and an unrelated third
party purchaser, who has made an ▇▇▇▇▇▇▇ money deposit of not less than $250 and
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who has been pre-qualified by the Borrower, one of its Restricted Subsidiaries
or an institutional lender.
"CONTRACTUAL OBLIGATION" of any Person means any obligation,
agreement, undertaking or similar provision of any Security issued by such
Person or of any agreement, undertaking, contract, lease, indenture, mortgage,
deed of trust or other instrument (excluding a Loan Document) to which such
Person is a party or by which it or any of its property is bound or to which any
of its property is subject.
"CUSTOMARY PERMITTED LIENS" means, with respect to any Person,
any of the following Liens:
(a) Liens with respect to the payment of taxes, assessments,
or governmental charges, including liens securing community development
district bonds or similar bonds issued by any Governmental Authority to
accomplish similar purposes, in each case that are not yet due or that
are being contested in good faith by appropriate proceedings and with
respect to which adequate reserves or other appropriate provisions are
being maintained to the extent required by GAAP;
(b) Liens of landlords arising by statute and liens of
suppliers, mechanics, carriers, materialmen, warehousemen or workmen
and other liens imposed by law and/or created in the ordinary course of
business for amounts not yet due or that are being contested in good
faith by appropriate proceedings and with respect to which adequate
reserves or other appropriate provisions are being maintained to the
extent required by GAAP;
(c) deposits made in the ordinary course of business in
connection with workers' compensation, unemployment insurance or other
types of social security benefits;
(d) Liens or deposits to secure the performance of bids,
tenders, sales, options, contracts (other than for the repayment of
borrowed money), surety, stay, appeal, customs, indemnity, performance
obligations or other similar bonds or obligations (not constituting
Indebtedness), arising in the ordinary course of business;
(e) encumbrances arising by reason of zoning restrictions,
easements, licenses, reservations, covenants, rights-of-way, utility
easements, building restrictions and other similar encumbrances on the
use of real property which do not materially detract from the value of
such real property or interfere with the ordinary conduct of the
business conducted and proposed to be conducted at such real property;
(f) encumbrances arising under leases or subleases of real
property which do not in the aggregate materially detract from the
value of such real property or interfere with the ordinary conduct of
the business conducted and proposed to be conducted at such real
property; and
(g) financing statements with respect to a lessor's rights in
and to personal property leased to such Person in the ordinary course
of such Person's business.
"DEFAULT" means any event that with the passing of time or the
giving of notice or both would become an Event of Default.
"DISCLOSURE DOCUMENTS" means, collectively: (i) the Borrower's
annual report on Form 10-K for the fiscal year ended December 31, 2003 as filed
with the Securities and Exchange Commission on February 10, 2004, (ii) the
Borrower's quarterly report on Form 10-Q for the quarter ended March 31, 2004 as
filed with the Securities and Exchange Commission on May 11, 2004, and (iii) the
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Confidential Information Memorandum dated September 2004 and posted
electronically on Intralinks relating to the Borrower and this Agreement.
"DOLLARS" and the sign "$" each mean the lawful money of the
United States of America.
"DOMESTIC LENDING OFFICE" means, with respect to any Lender,
the office of such Lender specified as its "Domestic Lending Office" opposite
its name on SCHEDULE II or on the Assignment and Acceptance by which it became a
Lender or such other office of such Lender as such Lender may from time to time
specify to the Borrower and the Administrative Agent.
"DOMESTIC SUBSIDIARY" means any Subsidiary of the Borrower
organized under the laws of any state of the United States of America or the
District of Columbia.
"EBITDA" means, for the Borrower and its Restricted
Subsidiaries for the twelve (12) month period ending on any date of
determination, an amount equal to (a) the Consolidated Net Income for such
period, PLUS (b) cash dividends from Unrestricted Subsidiaries paid to the
Borrower during such period, MINUS (c) gains from extraordinary items for such
period, to the extent included in the calculation of Consolidated Net Income for
such period in conformity with GAAP, but without duplication, PLUS (d) the sum
of (i) any provision for income taxes for such period, (ii) Interest Expense
deducted in the calculation of Consolidated Net Income for such period in
conformity with GAAP (including, without duplication, previously capitalized
Interest Expense which would be included in "cost of goods sold" and deducted
from Consolidated revenues in determining Consolidated Net Income), (iii) the
amount of depreciation and amortization for such period, (iv) any write-off of
goodwill, and (v) the amount of (x) any item of extraordinary loss not paid in
cash in such period and (y) any non-cash impairment charges in such period, in
each case to the extent included in the calculation of Consolidated Net Income
for such period in conformity with GAAP, but without duplication. In the case of
any Subsidiary of the Borrower that becomes a Restricted Subsidiary during any
period of calculation, EBITDA shall, for the purposes of the foregoing
calculations, be adjusted by increasing, if positive, or decreasing, if
negative, EBITDA by the EBITDA of such Subsidiary during such period of
calculation occurring prior to the date such Subsidiary became a Restricted
Subsidiary.
"EFFECTIVE DATE" has the meaning assigned to such term in
Section 3.1.
"ELIGIBLE ASSIGNEE" means (a) a Lender or any Affiliate or
Approved Fund of such Lender; (b) a commercial bank having total assets in
excess of $5,000,000,000; (c) a finance company, insurance company, or any other
financial institution or fund, in each case reasonably acceptable to the
Administrative Agent and regularly engaged in making, purchasing or investing in
loans, and having a net worth, determined in conformity with GAAP, in excess of
$250,000,000 (or, to the extent net worth is less than such amount, a finance
company, insurance company, other financial institution or fund, reasonably
acceptable to the Administrative Agent and, so long as there is no Default or
Event of Default continuing, the Borrower) or (d) a savings and loan association
or savings bank organized under the laws of the United States or any State
thereof having a net worth, determined in conformity with GAAP, in excess of
$250,000,000.
"ENTITLED LAND" means all land owned by the Borrower or its
Restricted Subsidiaries as part of their respective real estate development
business that has all requisite residential zoning for the construction of
Units.
"ENVIRONMENTAL LAWS" means all applicable Requirements of Law
now or hereafter in effect, as amended or supplemented from time to time,
relating to pollution or the regulation and protection of human health, safety,
-8-
the environment or natural resources, including any applicable Requirements of
Law relating to the protection of areas of particular environmental concern,
including wetlands, areas inhabited by endangered species, historic sites, and
areas above protected acquifers.
"ENVIRONMENTAL LIEN" means any Lien in favor of any
Governmental Authority for environmental liabilities and costs.
"EQUITY ISSUANCE" means the issue or sale of any Stock of the
Borrower or any of the Restricted Subsidiaries of the Borrower by the Borrower
or any of its Restricted Subsidiaries to any Person other than the Borrower or
any of such Restricted Subsidiaries.
"ERISA" means the Employee Retirement Income Security Act of
1974 (or any successor legislation thereto), as amended from time to time.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) under common control or treated as a single employer with the
Borrower or any of its Subsidiaries within the meaning of Section 414(b), (c),
(m) or (o) of the Code.
"ERISA EVENT" means (a) a reportable event described in
Section 4043(b) or 4043(c)(1), (2), (3), (5), (6), (8) or (9) of ERISA with
respect to a Title IV Plan with respect to which the notice requirement has not
been waived pursuant to applicable regulations; (b) the withdrawal of the
Borrower, any of its Subsidiaries or any ERISA Affiliate from a Title IV Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer, as defined in Section 4001(a)(2) of ERISA; (c) the
complete or partial withdrawal of the Borrower, any of its Subsidiaries or any
ERISA Affiliate from any Multiemployer Plan; (d) notice of reorganization or
insolvency of a Multiemployer Plan; (e) the filing of a notice of intent to
terminate a Title IV Plan or the treatment of a plan amendment as a termination
under Section 4041 of ERISA; (f) the institution of proceedings to terminate a
Title IV Plan by the PBGC; (g) the failure of the Borrower, any of its
Subsidiaries or any ERISA Affiliate to make any required contribution to a Title
IV Plan or Multiemployer Plan; (h) the imposition of a lien under Section 412 of
the Code or Section 302 of ERISA on the Borrower or any of its Subsidiaries or
any ERISA Affiliate; or (i) any other event or condition which might reasonably
be expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Title IV Plan
or the imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA.
"ESCROW PROCEEDS RECEIVABLES" means, with respect to the
Borrower and any of its Restricted Subsidiaries, the aggregate amount of funds
held in escrow by a title company or escrow agent which are payable (without any
requirement of the satisfaction or waiver of any further condition) to the
Borrower or such Restricted Subsidiary and which constitute proceeds of sales of
Units.
"EUROCURRENCY LIABILITIES" has the meaning assigned to that
term in Regulation D of the Federal Reserve Board, as in effect from time to
time.
"EURODOLLAR BASE RATE" means, with respect to any Interest
Period for any Eurodollar Rate Loan, the rate determined by the Administrative
Agent to be the offered rate for deposits in Dollars for the applicable Interest
Period appearing on the Dow ▇▇▇▇▇ Markets Telerate Page 3750 as of 11:00 a.m.,
London time, two Business Days prior to the first day of each Interest Period.
In the event that such rate does not appear on the Dow ▇▇▇▇▇ Markets Telerate
Page 3750 (or otherwise on the Dow ▇▇▇▇▇ Markets screen), the Eurodollar Base
Rate for the purposes of this definition shall be determined by reference to
such other comparable publicly available service for displaying eurodollar rates
as may be selected by the Administrative Agent.
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"EURODOLLAR LENDING OFFICE" means, with respect to any Lender,
the office of such Lender specified as its "Eurodollar Lending Office" opposite
its name on SCHEDULE II or on the Assignment and Acceptance by which it became a
Lender (or, if no such office is specified, its Domestic Lending Office) or such
other office of such Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.
"EURODOLLAR RATE" means, with respect to any Interest Period
for any Eurodollar Rate Loan, an interest rate per annum equal to the rate per
annum obtained by dividing (a) the Eurodollar Base Rate by (b) a percentage
equal to 100% minus the reserve percentage applicable two Business Days before
the first day of such Interest Period under regulations issued from time to time
by the Federal Reserve Board for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve requirement)
for a member bank of the Federal Reserve System in New York City with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities (or
with respect to any other category of liabilities that includes deposits by
reference to which the Eurodollar Rate is determined) having a term equal to
such Interest Period.
"EURODOLLAR RATE LOAN" means any Loan that, for an Interest
Period, bears interest based on the Eurodollar Rate.
"EVENT OF DEFAULT" has the meaning assigned to such term in
Section 8.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXECUTIVE ORDER" has the meaning assigned to such term in
Section 4.19.
"EXISTING CREDIT AGREEMENT" means that certain Amended and
Restated Credit Agreement dated as of April 4, 2003 by and among the Borrower,
the lenders and issuers party thereto, CNAI as administrative agent and Fleet
National Bank as documentation agent, as amended, amended and restated or
otherwise modified from time to time.
"EXISTING LETTERS OF CREDIT" means each letter of credit set
forth on SCHEDULE 2.4 that was previously issued for the account of the Borrower
under the Existing Credit Agreement that is outstanding on the Effective Date.
"EXTENDING LENDER" has the meaning assigned to such term in
Section 2.17(a).
"FACILITY" means the Revolving Credit Commitments and the
provisions herein related to the Revolving Loans, Swing Loans and Letters of
Credit.
"FACILITY EXTENSION" has the meaning assigned to such term in
Section 2.17(a).
"FACILITY INCREASE" has the meaning assigned to such term in
Section 2.18.
"FACILITY INCREASE EFFECTIVE DATE" has the meaning assigned to
such term in Section 2.18.
"FAIR MARKET VALUE" means (a) with respect to any asset or
group of assets (other than a marketable Security) at any date, the value of the
consideration obtainable in a sale of such asset at such date assuming a sale by
a willing seller to a willing purchaser dealing at arm's length, and (b) with
respect to any marketable Security at any date, the closing sale price of such
Security on the Business Day next preceding such date, as appearing in any
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published list of any national securities exchange or the Nasdaq Stock Market
or, if there is no such closing sale price of such Security, the final price for
the purchase of such Security at face value quoted on such business day by a
financial institution of recognized standing which regularly deals in securities
of such type selected by the Administrative Agent.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating
interest rate PER ANNUM 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 rate (rounded upward, if
necessary, to a whole multiple of 1/100 of 1%) charged to the Administrative
Agent on such day on such transactions as determined by the Administrative
Agent.
"FEDERAL RESERVE BOARD" means the Board of Governors of the
Federal Reserve System, or any successor thereto.
"FINANCIAL STATEMENTS" means the financial statements of the
Borrower and its Subsidiaries delivered in accordance with Sections 4.4 and 6.1.
"FINISHED LOTS" means lots of Entitled Land as to which
offsite construction has been substantially completed, utilities and all major
infrastructure have been completed and stubbed to the site, and building permits
for Units may be promptly pulled and construction commenced by the Borrower or
any Restricted Subsidiary without the satisfaction of any further conditions,
the value of which is determined in conformity with GAAP.
"FITCH" means Fitch, Inc. or any successor to the rating
agency business thereof.
"FUND" means any Person (other than a natural Person) that is
or will be engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of its
business.
"GAAP" means generally accepted accounting principles in the
United States of America as in effect from time to time set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and the statements and pronouncements
of the Financial Accounting Standards Board, or in such other statements by such
other entity as may be in general use by significant segments of the accounting
profession, which are applicable to the circumstances as of the date of
determination; PROVIDED that with respect to determining compliance with any
financial covenant (including related definitions), "GAAP" shall be determined
based upon those accounting principles referred to above as of the Effective
Date.
"GOVERNMENTAL AUTHORITY" means any nation or government, any
state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"GUARANTOR" means each Restricted Subsidiary of the Borrower
party to the Guaranty.
"GUARANTY" means the guaranty agreement substantially in the
form of EXHIBIT H, dated as of the Effective Date executed by each Restricted
Subsidiary of the Borrower named therein or that has executed a joinder to the
Guaranty pursuant to Section 6.13.
"HEDGING CONTRACTS" means all Interest Rate Contracts, foreign
exchange contracts, currency swap or option agreements, forward contracts,
commodity swap, purchase or option agreements, other commodity price hedging
arrangements, and all other similar agreements or arrangements designed to alter
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the risks of any Person arising from fluctuations in interest rates, currency
values or commodity prices.
"INDEBTEDNESS" of any Person means without duplication (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person evidenced by notes, bonds, debentures or similar instruments that bear
interest, (c) all reimbursement and all obligations with respect to letters of
credit, bankers' acceptances, surety bonds and performance bonds, (d) all
indebtedness for the deferred purchase price of property or services, other than
trade payables incurred in the ordinary course of business that are not overdue,
(e) all indebtedness of such Person created or arising under any conditional
sale or other title retention agreement with respect to property acquired by
such Person (even though the rights and remedies of the seller or lender under
such agreement in the event of default are limited to repossession or sale of
such property), (f) all Capital Lease Obligations of such Person and the present
value of future rental payments under all synthetic leases, (g) all guaranty
obligations of such Person with respect to obligations of another Person that
would otherwise constitute Indebtedness hereunder, (h) all obligations of such
Person to purchase, redeem, retire, defease or otherwise acquire for value any
Stock or Stock Equivalents of such Person, valued, in the case of redeemable
preferred stock, at the greater of its voluntary liquidation preference and its
involuntary liquidation preference PLUS accrued and unpaid dividends, (i) all
payments that such Person would have to make in the event of an early
termination on the date Indebtedness of such Person is being determined in
respect of Hedging Contracts of such Person and (j) all Indebtedness of the type
referred to above secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any Lien upon or
in property (including Accounts and general intangibles) owned by such Person,
even though such Person has not assumed or become liable for the payment of such
Indebtedness but only to the extent of the lesser of (x) the amount of such
Indebtedness and (y) the Fair Market Value of the property securing such
Indebtedness. Notwithstanding the foregoing, "Indebtedness" shall not include
(x) the face amount of any undrawn Performance Letters of Credit, (y)
Indebtedness Associated with Assets Not Owned, or (z) obligations with respect
to options to purchase real property that have not been exercised.
"INDEBTEDNESS ASSOCIATED WITH ASSETS NOT OWNED" means any
Indebtedness of any land bank, or any other third party Indebtedness that would
be required to be included on the balance sheet or financial statements of the
Borrower or any of its Subsidiaries pursuant to any accounting rule requiring
such consolidation, including Indebtedness of any Joint Venture or Indebtedness
of any Unrestricted Subsidiary, except to the extent that such Indebtedness
would otherwise fall under clause (g) of the definition of "Indebtedness" with
respect to the Borrower or a Restricted Subsidiary.
"INDEBTEDNESS TO ADJUSTED CONSOLIDATED TANGIBLE NET WORTH
RATIO" means, with respect to the Borrower at any date of determination, the
ratio of (a) all Indebtedness of the Borrower and its Restricted Subsidiaries as
of such date less Unrestricted Cash in excess of $10,000,000 to (b) Adjusted
Consolidated Tangible Net Worth of the Borrower at such date.
"INDEMNIFIED MATTER" has the meaning assigned to such term in
Section 10.4.
"INDEMNITEES" has the meaning assigned to such term in Section
10.4.
"INTEREST COVERAGE RATIO" means, with respect to the Borrower
and its Restricted Subsidiaries for any period, the ratio of (a) EBITDA for such
period to (b) the Consolidated Interest Incurred for such period.
"INTEREST EXPENSE" means, for any Person for any period, total
interest expense of such Person and its Subsidiaries for such period determined
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on a Consolidated basis in conformity with GAAP. Notwithstanding that GAAP may
otherwise provide, the Borrower shall not be required to include in Interest
Expense the amount of any premium paid to prepay Indebtedness.
"INTEREST INCURRED" means for any period, the aggregate amount
(without duplication and determined in each case in conformity with GAAP) of
interest incurred during such period, whether such interest was expensed or
capitalized, paid, accrued, or scheduled to be paid or accrued by the Borrower
and its Restricted Subsidiaries during such period, including (a) original issue
discount and non-cash interest payments of accruals on any Indebtedness, (b) the
interest portion of all deferred payment obligations, and (c) all commissions,
discounts, and other fees and charges owed with respect to bankers' acceptances
and letter of credit financings and Interest Rate Contracts. For purposes of
this definition, (i) interest on any Capital Lease Obligations shall be deemed
to accrue at an interest rate reasonably determined by the Borrower to be the
rate of interest implicit in such obligations in conformity with GAAP, and (ii)
interest expense attributable to any Indebtedness represented by the guaranty of
an obligation of another Person shall be deemed to be the interest expense
attributable to the Indebtedness so guaranteed.
"INTEREST PERIOD" means, in the case of any Eurodollar Rate
Loan, (a) initially, the period commencing on the date such Eurodollar Rate Loan
is made or on the date of conversion of a Base Rate Loan to such Eurodollar Rate
Loan and ending one, two, three or six months thereafter as selected by the
Borrower in its Notice of Borrowing or Notice of Conversion or Continuation
given to the Administrative Agent pursuant to Section 2.2 or 2.10, and (b)
thereafter, if such Loan is continued, in whole or in part, as a Eurodollar Rate
Loan pursuant to Section 2.10, a period commencing on the last day of the
immediately preceding Interest Period therefor and ending one, two, three or six
months thereafter as selected by the Borrower in its Notice of Conversion or
Continuation given to the Administrative Agent pursuant to Section 2.10;
PROVIDED, HOWEVER, that all of the foregoing provisions relating to Interest
Periods in respect of Eurodollar Rate Loans are subject to the following:
(i) if any Interest Period would otherwise end on a day which
is not a Business Day, such Interest Period shall be extended to the
next succeeding Business Day, unless the result of such extension would
be to extend such Interest Period into another calendar month, in which
event such Interest Period shall end on the immediately preceding
Business Day;
(ii) 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 end on the last Business Day of a calendar month;
(iii) the Borrower may not select any Interest Period in
respect of Loans having an aggregate principal amount of less than
$5,000,000;
(iv) there shall be outstanding at any one time no more than
six Interest Periods in the aggregate; and
(v) any Interest Period that would end after the Revolving
Credit Termination Date shall end on the Revolving Credit Termination
Date and, in the case of Loans subject to Section 2.17, any Interest
Period that would end after the applicable Scheduled Maturity Date
shall end on the applicable Scheduled Maturity Date.
"INTEREST RATE CONTRACTS" means all interest rate swap
agreements, interest rate cap agreements, interest rate collar agreements and
interest rate insurance.
"INVESTMENT" means, with respect to any Person, (a) any
purchase or other acquisition by such Person of (i) any Security issued by, (ii)
a beneficial interest in any Security issued by, or (iii) any other equity
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ownership interest in, any other Person, (b) any purchase by such Person of all
or a significant part of the assets of a business conducted by another Person or
all or substantially all of the assets constituting the business of a division,
branch or other unit operation of any other Person, and (c) any loan, advance
(other than deposits with financial institutions available for withdrawal on
demand, prepaid expenses, accounts receivable and similar items made or incurred
in the ordinary course of business as presently conducted), or capital
contribution by such Person to any other Person, including all Indebtedness of
any other Person to such Person arising from a sale of property by such Person
other than in the ordinary course of its business and (d) any guaranty
obligation incurred by such Person in respect of Indebtedness of any other
Person.
"IRS" means the Internal Revenue Service of the United States
or any successor thereto.
"ISSUE" means, with respect to any Letter of Credit, to issue,
extend the expiry of, renew or increase the maximum stated amount (including by
deleting or reducing any scheduled decrease in such maximum stated amount) of,
such Letter of Credit. The terms "ISSUED" and "ISSUANCE" shall have a
corresponding meaning.
"ISSUER" means (a) each Lender or Affiliate of a Lender that
is listed on the signature pages hereof as an "Issuer", (b) each Lender or
Affiliate of a Lender that hereafter becomes an Issuer with the approval of the
Administrative Agent and the Borrower by agreeing pursuant to an agreement with
and in form and substance satisfactory to the Administrative Agent and the
Borrower to be bound by the terms hereof applicable to Issuers or (c) solely
with respect to an Existing Letter of Credit (and any amendment, renewal or
extension thereof in accordance with this Agreement), the Lender that issued
such Existing Letter of Credit.
"JANUARY 2003 SENIOR NOTES" means the 9% Senior Notes due 2010
issued by the Borrower pursuant to the Indenture dated as of February 3, 2003
between the Borrower and ▇▇▇▇▇ Fargo Bank, N.A. (as successor by consolidation
to ▇▇▇▇▇ Fargo Bank Minnesota, National Association), as trustee.
"JOINT VENTURE" means any Person (other than a Subsidiary) in
which the Borrower or a Restricted Subsidiary holds any Investment (other than
an Investment described in clauses (b) or (d) of the definition thereof)
provided that such Joint Venture (i) is formed for and is or will be engaged in
real estate activities and (ii) shall only involve assets located in the
Permitted Markets.
"LAND/LOTS UNDER DEVELOPMENT" means Entitled Land where
physical site improvement has commenced and is continuing, the value of which is
determined in conformity with GAAP.
"LEASES" means, with respect to any Person, all of those
leasehold estates in real property of such Person, as lessee, as such may be
amended, supplemented or otherwise modified from time to time.
"LENDER" means each financial institution or other entity that
(a) is listed on the signature pages hereof as a "Lender" or (b) from time to
time becomes a party hereto by execution of an Assignment and Acceptance.
"LETTER OF CREDIT" means any letter of credit issued or deemed
issued pursuant to Section 2.4 (including any Existing Letter of Credit).
"LETTER OF CREDIT OBLIGATIONS" means, at any time, the
aggregate of all liabilities at such time of the Borrower to all Issuers with
respect to Letters of Credit, whether or not any such liability is contingent,
-14-
and includes the sum of (a) the Reimbursement Obligations at such time and (b)
the Letter of Credit Undrawn Amounts at such time.
"LETTER OF CREDIT REQUEST" has the meaning assigned to such
term in Section 2.4(c).
"LETTER OF CREDIT UNDRAWN AMOUNTS" means, at any time, the
aggregate undrawn face amount of all Letters of Credit outstanding at such time.
"LIEN" means, with respect to any property, asset or right,
any mortgage, lien, pledge, assignment, charge, security interest, levy,
execution, seizure, attachment, garnishment, or other encumbrance of any kind in
the nature of the foregoing in respect of such property, asset or right, whether
or not ▇▇▇▇▇▇, vested or perfected.
"LOAN" means any loan made by any Lender pursuant to this
Agreement.
"LOAN DOCUMENTS" means, collectively, this Agreement, the
Revolving Credit Notes (if any), the Guaranty, each agreement pursuant to which
a Lender or an Affiliate of a Lender provides cash management services to a Loan
Party, and each certificate, agreement or document executed by a Loan Party and
delivered to the Administrative Agent or any Lender in connection with or
pursuant to any of the foregoing.
"LOAN PARTY" means each of the Borrower, each Guarantor and
each other Subsidiary of the Borrower that executes and delivers a Loan
Document.
"MANAGEMENT SERVICES AGREEMENT" means the Amended and Restated
Management Services Agreement, dated as of June 13, 2003 between the Borrower
and ▇▇▇▇ as amended, amended and restated or otherwise modified from time to
time, provided that the terms thereof are no more adverse to the Lenders than
the terms as of the date hereof.
"MATERIAL ADVERSE CHANGE" means a material adverse change in
any of (a) the business, condition (financial or otherwise), performance,
properties, prospects or operations of any Loan Party or (b) the ability of any
Loan Party to perform its respective obligations under the Loan Documents.
"MATERIAL ADVERSE EFFECT" means an event that results in or
causes, or could reasonably be expected to result in or cause, a Material
Adverse Change.
"MAXIMUM CREDIT" means, at any time, the lesser of (a) the
Revolving Credit Commitments in effect at such time and (b) the amount by which
Borrowing Base at such time exceeds the amount of Senior Unsecured Indebtedness
outstanding at such time.
"MODEL HOMES" means all Units which are used as models, sales
offices, or design centers to market a particular real estate development
project and the contents therein.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc. or any
successor to the rating agency business thereof.
"MULTIEMPLOYER PLAN" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Borrower, any of its Restricted
Subsidiaries or any ERISA Affiliate has any obligation or liability, contingent
or otherwise.
"NON-CONSENTING LENDER" has the meaning assigned to such term
in Section 10.1(c).
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"NON-FUNDING LENDER" has the meaning assigned to such term in
Section 2.2(d).
"NON-U.S. LENDER" means each Lender or Administrative Agent
that is not a United States person as defined in Section 7701(a)(30) of the
Code.
"NOTICE OF BORROWING" has the meaning assigned to such term in
Section 2.2(a).
"NOTICE OF CONVERSION OR CONTINUATION" has the meaning
assigned to such term in Section 2.10(a).
"OBLIGATIONS" means, without duplication, the Loans, the
Letter of Credit Obligations and all other amounts owing by the Borrower to the
Administrative Agent, any Lender, any Issuer, any Affiliate of any of them or
any Indemnitee, of every type and description, present or future, arising under
this Agreement, any other Loan Document, whether direct or indirect, including
all letter of credit and other fees, interest, charges, expenses, attorneys'
fees and disbursements and other sums chargeable to the Borrower under this
Agreement or any other Loan Document.
"ONE YEAR PROJECTIONS" means those Consolidated financial
projections dated September 21, 2004 covering each fiscal quarter ending in
2005.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PERFORMANCE LETTERS OF CREDIT" means any letter of credit
issued (a) on behalf of a Person in favor of a Governmental Authority,
including, without limitation, any utility, water, or sewer authority, or other
similar entity, for the purpose of assuring such Governmental Authority that
such Person or an Affiliate of such Person will properly and timely complete
work it has agreed to perform for the benefit of such Governmental Authority; or
(b) in lieu of other contract performance, including, without limitation, bid
and performance bonds.
"PERMIT" means any permit, approval, authorization, license,
variance or permission required from a Governmental Authority under an
applicable Requirement of Law.
"PERMITTED ACQUISITION" means the acquisition by the Borrower
or any of its Restricted Subsidiaries of all or substantially all of the assets
or Stock of any Person or of any operating division thereof (the "TARGET"), or
the merger of the Target with or into the Borrower or any Restricted Subsidiary
of the Borrower (with the Borrower, in the case of a merger with the Borrower,
being the surviving corporation) (each an "ACQUISITION"); PROVIDED that such
Acquisition shall only involve assets located in the Permitted Markets and only
for use in the lines of business of the Borrower or its Restricted Subsidiaries
existing on the Effective Date.
"PERMITTED HOLDERS" means TOSA or any Person of which TOSA
"beneficially owns" (as defined in Rule 13d-3 under the Exchange Act),
individually or collectively, at least a majority of the total voting power of
the Voting Stock of such Person.
"PERMITTED MARKETS" means housing markets located in the
continental United States of America.
"PERMITTED REFINANCING INDEBTEDNESS" means any Indebtedness
issued in exchange for, or the net proceeds of which are used to extend,
refinance, renew, replace, defease or refund (collectively, to "Refinance"), the
Indebtedness being Refinanced (or previous refinancings thereof constituting
Permitted Refinancing Indebtedness); PROVIDED that (a) the principal amount (or
accreted value, if applicable) of such Permitted Refinancing Indebtedness does
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not exceed the principal amount (or accreted value, if applicable) of the
Indebtedness so Refinanced (plus unpaid accrued interest and premium thereon),
(b) the average life to maturity of such Permitted Refinancing Indebtedness is
greater than or equal to that of the Indebtedness being Refinanced, (c) if the
Indebtedness being Refinanced is subordinated in right of payment to the
Obligations under this Agreement, such Permitted Refinancing Indebtedness shall
be subordinated in right of payment to such Obligations on terms at least as
favorable to the Lenders as those contained in the documentation governing the
Indebtedness being Refinanced, and (d) no Permitted Refinancing Indebtedness
shall have different obligors, or greater guarantees or security, than the
Indebtedness being refinanced.
"PERSON" means an individual, partnership, corporation
(including a business trust), joint stock company, estate, trust, limited
liability company, unincorporated association, Joint Venture or other entity, or
a Governmental Authority.
"PLATFORM" has the meaning assigned to such term in Section
10.19(b).
"PROPOSED CHANGE" has the meaning assigned to such term in
Section 10.1(c).
"RATABLE PORTION" or "RATABLY" means, with respect to any
Lender, the percentage obtained by dividing (a) the Revolving Credit Commitment
of such Lender by (b) the aggregate Revolving Credit Commitments of all Lenders
(or, at any time after the Revolving Credit Termination Date, the percentage
obtained by dividing the aggregate outstanding principal balance of the
Revolving Credit Outstandings owing to such Lender by the aggregate outstanding
principal balance of the Revolving Credit Outstandings owing to all Lenders).
"REAL PROPERTY" means all of those plots, pieces or parcels of
land now owned, leased or hereafter acquired or leased by the Borrower or any of
its Restricted Subsidiaries (the "LAND"), together with the right, title and
interest of the Borrower or any of its Restricted Subsidiaries, if any, in and
to the streets, the land lying in the bed of any streets, roads or avenues,
opened or proposed, in front of, the air space and development rights pertaining
to the Land and the right to use such air space and development rights, all
rights of way, privileges, liberties, tenements, hereditaments and appurtenances
belonging or in any way appertaining thereto, all fixtures, all easements now or
hereafter benefiting the Land and all royalties and rights appertaining to the
use and enjoyment of the Land necessary for the residential development of such
Land, together with all of the buildings and other improvements now or hereafter
erected on the Land, and any fixtures appurtenant thereto.
"REGISTER" has the meaning assigned to such term in Section
10.2(c).
"REIMBURSEMENT DATE" has the meaning assigned to such term in
Section 2.4(g).
"REIMBURSEMENT OBLIGATIONS" means all matured reimbursement or
repayment obligations of the Borrower to any Issuer with respect to amounts
drawn under Letters of Credit.
"REJECTING LENDER" has the meaning assigned to such term in
Section 2.17(b).
"RELEASE" means, with respect to any Person, any release,
spill, emission, leaking, pumping, injection, deposit, disposal, discharge,
dispersal, leaching or migration, in each case, of any Contaminant into the
indoor or outdoor environment or into or out of any property owned or operated
by such Person, including the movement of Contaminants through or in the air,
soil, surface water, ground water or property.
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"REMEDIAL ACTION" means all actions required to (a) clean up,
remove, treat or in any other way address any Contaminant in the indoor or
outdoor environment, (b) prevent the Release or threat of Release or minimize
the further Release so that a Contaminant does not migrate or endanger or
threaten to endanger public health or welfare or the indoor or outdoor
environment or (c) perform pursuant to Environmental Laws pre-remedial studies
and investigations and post-remedial monitoring and care.
"REQUIREMENT OF LAW" means, with respect to any Person, the
common law and all federal, state, local and foreign laws, rules and
regulations, orders, judgments, decrees and other determinations of any
Governmental Authority or arbitrator, applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is subject
(including, without limitation, any Environmental Law).
"REQUISITE LENDERS" means, collectively, Lenders having a
majority of the aggregate outstanding amount of the Revolving Credit Commitments
or, after the Revolving Credit Termination Date, a majority of the aggregate
Revolving Credit Outstandings. A Non-Funding Lender shall not be included in the
calculation of "REQUISITE LENDERS."
"RESPONSIBLE OFFICER" means, with respect to any Person, any
of the principal executive officers, managing members or general partners of
such Person, but in any event, with respect to financial matters, the chief
financial officer, chief accounting officer, treasurer, assistant treasurer,
vice president of finance or controller of such Person.
"RESTRICTED PAYMENT" means (a) any dividend, distribution or
any other payment whether direct or indirect, on account of any Stock or Stock
Equivalents of the Borrower or any of its Restricted Subsidiaries now or
hereafter outstanding, (b) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any
Stock or Stock Equivalents of the Borrower now or hereafter outstanding; and (c)
any payment of principal of, or premium on, the Subordinated Notes prior to the
stated maturity thereof.
"RESTRICTED SUBSIDIARY" means each Subsidiary of the Borrower,
other than (i) those that have been properly designated pursuant to Section 6.14
as an Unrestricted Subsidiary and (ii) those Subsidiaries engaged in the
business of originating residential home loans, title insurance and reinsurance.
"REVOLVING CREDIT COMMITMENT" means, with respect to each
Lender, the commitment of such Lender to make Revolving Loans and acquire
interests in other Revolving Credit Outstandings in the aggregate principal
amount outstanding not to exceed the amount set forth opposite such Lender's
name on SCHEDULE I under the caption "REVOLVING CREDIT COMMITMENT," as amended
to reflect each Assignment and Acceptance or Assumption Agreement executed by
such Lender and as such amount may be increased or reduced pursuant to this
Agreement.
"REVOLVING CREDIT NOTE" means a promissory note of the
Borrower payable to the order of any Lender in a principal amount equal to the
amount of such Lender's Revolving Credit Commitment evidencing the aggregate
Indebtedness of the Borrower to such Lender resulting from the Revolving Loans
owing to such Lender.
"REVOLVING CREDIT OUTSTANDINGS" means, at any particular time,
the sum of (a) the principal amount of the Revolving Loans outstanding at such
time PLUS (b) the Letter of Credit Obligations outstanding at such time PLUS (c)
the principal amount of the Swing Loans outstanding at such time.
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"REVOLVING CREDIT TERMINATION DATE" shall mean the earliest of
(a) the Scheduled Termination Date, (b) the date of termination of the Revolving
Credit Commitments pursuant to Section 2.5 and (c) the date on which the
Obligations become due and payable pursuant to Section 8.2.
"REVOLVING LOAN" has the meaning assigned to such term in
Section 2.1.
"S&P" means Standard & Poor's Rating Services or any successor
to the rating agency business thereof.
"SCHEDULED TERMINATION DATE" means, as to each Lender, the
fourth anniversary of the Effective Date subject to the provisions for the
extension of the Scheduled Termination Date, as to such Lender, set forth in
Section 2.17.
"SECURITY" means any Stock, Stock Equivalent, voting trust
certificate, bond, debenture, note or other evidence of Indebtedness, whether
secured, unsecured, convertible or subordinated, or any certificate of interest,
share or participation in, or any temporary or interim certificate for the
purchase or acquisition of, or any right to subscribe to, purchase or acquire,
any of the foregoing, but shall not include any evidence of the Obligations.
"SELLING LENDER" has the meaning assigned to such term in
Section 10.7(a).
"SENIOR NOTES" means the 9% Senior Notes due 2010 issued by
the Borrower pursuant to the Indenture dated as of February 3, 2003 between the
Borrower and ▇▇▇▇▇ Fargo Bank, N.A. (as successor by consolidation to ▇▇▇▇▇
Fargo Bank Minnesota, National Association), as trustee and the Indenture dated
as of June 25, 2002, between the Borrower and ▇▇▇▇▇ Fargo Bank, N.A. (as
successor by consolidation to ▇▇▇▇▇ Fargo Bank Minnesota, National Association),
as trustee.
"SENIOR UNSECURED INDEBTEDNESS" shall mean at any time, the
Indebtedness of the Borrower and its Subsidiaries comprised of (a) the
outstanding principal amount of the Senior Notes and the January 2003 Senior
Notes outstanding at such time, (b) the outstanding Revolving Loans and Swing
Loans, and any undrawn Letters of Credit issued, under the Loan Documents at
such time, and (c) the outstanding principal amount of all other unsecured
Indebtedness which is PARI PASSU to the obligations under the Loan Documents
other than trade payables that are not more than 90 days past the original
invoice date thereof.
"SOLD HOMES" means all Units (including Model Homes) on which
a building permit has been issued and construction has begun or has been
completed, for which the Borrower or any Restricted Subsidiary has entered into
a written Contract for Sale, the value of which is determined in conformity with
GAAP.
"STOCK" means shares of capital stock (whether denominated as
common stock or preferred stock), beneficial, partnership or membership
interests, participations or other equivalents (regardless of how designated) of
or in a corporation, partnership, limited liability company or equivalent
entity, whether voting or non-voting.
"STOCK EQUIVALENTS" means all securities convertible into or
exchangeable for Stock and all warrants, options or other rights to purchase or
subscribe for any Stock, whether or not presently convertible, exchangeable or
exercisable.
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"SUBORDINATED INDEBTEDNESS" means any Indebtedness of the
Borrower and its Restricted Subsidiaries that is subordinated to the Obligations
on terms and conditions not materially less favorable than the terms and
conditions of the Subordinated Notes.
"SUBORDINATED NOTES" means, collectively, the 10 3/8% Senior
Subordinated Notes due 2012 and the 7 1/2% Senior Subordinated Notes due 2011
issued by the Borrower pursuant to the Indenture dated as of June 25, 2002,
between the Borrower and ▇▇▇▇▇ Fargo Bank, N.A. (as successor by consolidation
to ▇▇▇▇▇ Fargo Bank National Association), as trustee and the Indenture dated as
of March 10, 2004 between the Borrower and ▇▇▇▇▇ Fargo Bank, N.A. (as successor
by consolidation to ▇▇▇▇▇ Fargo Bank Minnesota, National Association), as
trustee; or any Permitted Refinancing Indebtedness thereof.
"SUBSIDIARY" means, with respect to any Person, any
corporation, partnership, limited liability company or other business entity of
which an aggregate of over 50% of the outstanding Voting Stock is, at the time,
directly or indirectly, owned or controlled by such Person and/or one or more
Subsidiaries of such Person.
"SWING LOAN" has the meaning assigned to such term in Section
2.3(a).
"SWING LOAN BORROWING" means a borrowing consisting of a Swing
Loan.
"SWING LOAN LENDER" means CNAI or any other Lender that
becomes the Administrative Agent or that agrees with the approval of the
Administrative Agent and the Borrower to act as the Swing Loan Lender hereunder.
"SWING LOAN REQUEST" has the meaning assigned to such term in
Section 2.3(b).
"TANGIBLE NET WORTH" means, with respect to the Borrower and
its Restricted Subsidiaries, the net worth of the Borrower and its Restricted
Subsidiaries, determined in conformity with GAAP, less all intangible assets of
the Borrower and its Restricted Subsidiaries but excluding any non-cash gain or
loss resulting from any ▇▇▇▇-to-market adjustments made directly to the net
worth of Borrower and its Restricted Subsidiaries on a Consolidated basis as a
result of fluctuations in the value of financial instruments owned by Borrower
and its Restricted Subsidiaries as required under SFAS 133.
"TAX AFFILIATE" means, with respect to any Person, (a) any
Subsidiary of such Person, and (b) any Affiliate of such Person with which such
Person files or is eligible to file Consolidated, combined or unitary tax
returns.
"TAX ALLOCATION AGREEMENT" means the Tax Allocation Agreement
dated as of March 15, 2000 between Technical Olympic, Inc. and the Borrower, as
amended, amended and restated or otherwise modified from time to time, provided
that the terms thereof (other than any statutory change in tax rates) are no
more adverse to the Lenders than the terms as of the date hereof.
"TAX RETURN" has the meaning assigned to such term in Section
4.7(a).
"TAXES" has the meaning assigned to such term in Section
2.15(a).
"TITLE IV PLAN" means a pension plan, other than a
Multiemployer Plan, covered by Title IV of ERISA and to which the Borrower, any
of its Restricted Subsidiaries or any ERISA Affiliate has any obligation or
liability (contingent or otherwise).
"TOSA" means Technical Olympic SA, a Greek publicly traded
company.
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"▇▇▇▇" means Technical Olympic Services, Inc., a Delaware
corporation.
"TOTAL ASSETS" of any Person means, at any date, (a) the total
assets of such Person and its Restricted Subsidiaries at such date determined on
a Consolidated basis in conformity with GAAP MINUS (b) any Securities issued by
such Person held as treasury securities.
"TOTAL REVOLVING CREDIT COMMITMENT" means, as of any date, the
sum of all Revolving Credit Commitments for all Lenders then in effect, which
sum shall not exceed $600,000,000 unless the Total Revolving Credit Commitment
is increased pursuant to Section 2.18.
"UCC" means the Uniform Commercial Code then in effect for the
State of New York, or such other jurisdiction as the context may require.
"UNAFFILIATED" means, with respect to a Joint Venture or an
Unrestricted Subsidiary, as the case may be, an entity for which all of the
ownership or equity interests that are not owned by the Borrower or any
Restricted Subsidiary of the Borrower are owned by persons who are not Permitted
Holders or Affiliates of Permitted Holders.
"UNIMPROVED LAND" means all Entitled Land on which no
construction of on-site infrastructure improvements has begun, the value of
which is determined in conformity with GAAP.
"UNIT" means a single or multi family residential unit,
including a condominium and townhouse unit.
"UNITS CLOSED" means a Unit for which the purchase price
therefor has been paid and the title therefor has been delivered to a purchaser
in accordance with a Contract for Sale for such Unit.
"UNRESTRICTED CASH" means all cash and Cash Equivalents of the
Borrower and its Restricted Subsidiaries that is not subject to a Lien or other
restriction (including, without limitation, any escrow in connection with
Contracts for Sale).
"UNRESTRICTED SUBSIDIARY" means any Subsidiary of the Borrower
designated as an "Unrestricted Subsidiary" in accordance with Section 6.14 and
which is not a Restricted Subsidiary.
"UNSOLD HOMES UNDER CONSTRUCTION" means all Units for which
building permits have been issued and construction has commenced, but not
completed, and for which there is no written binding contract of sale with an
unrelated third party purchaser, the value of which is determined in conformity
with GAAP.
"UNSOLD LAND" means Unimproved Land, Land/Lot Under
Development and Finished Lots, excluding such Finished Lots subject to a
Contract for Sale.
"UNSOLD UNITS" means Unsold Homes Under Construction and
Completed Unsold Homes.
"UNUSED COMMITMENT" means, as of any date, the amount by which
(a) the Total Revolving Credit Commitments on such date exceed (b) the Revolving
Credit Outstandings as of such date.
"UNUSED COMMITMENT PERCENTAGE" means, as of any date, the
Unused Commitment divided by the total Revolving Credit Commitment.
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"USA PATRIOT ACT" has the meaning assigned to such term in
Section 4.19.
"VOTING STOCK" means Stock of any Person having ordinary power
to vote in the election of members of the board of directors, managers, trustees
or other controlling Persons, of such Person (irrespective of whether, at the
time, Stock of any other class or classes of such entity shall have or might
have voting power by reason of the happening of any contingency).
"WHOLLY-OWNED SUBSIDIARY" means, in respect of any Person, any
Subsidiary of such Person, all of the Stock of which (other than director's
qualifying shares as may be required by law) is owned by such Person either
directly or indirectly through one or more Wholly-Owned Subsidiaries of Such
Person.
"WITHDRAWAL LIABILITY" means, with respect to the Borrower or
any of its Subsidiaries at any time, the aggregate liability incurred (whether
or not assessed) with respect to all Multiemployer Plans pursuant to Section
4201 of ERISA or for increases in contributions required to be made pursuant to
Section 4243 of ERISA.
SECTION 1.2 COMPUTATION OF TIME PERIODS.
In this Agreement, in the computation of periods of time from
a specified date to a later specified date, the word "FROM" means "FROM AND
INCLUDING" and the words "TO" and "UNTIL" each mean "TO BUT EXCLUDING" and the
word "THROUGH" means "TO AND INCLUDING."
SECTION 1.3 ACCOUNTING TERMS AND PRINCIPLES.
Except as set forth below, all accounting terms not
specifically defined herein shall be construed in conformity with GAAP and all
accounting determinations required to be made pursuant hereto shall, unless
expressly otherwise provided herein, be made in conformity with GAAP.
SECTION 1.4 CERTAIN TERMS.
(a) The words "HEREIN," "HEREOF" and "HEREUNDER" and similar
words refer to this Agreement as a whole, and not to any particular Article,
Section, subsection or clause in, this Agreement.
(b) Unless otherwise expressly indicated herein, references in
this Agreement to an Exhibit, Schedule, Article, Section, subsection or clause
refer to the appropriate Exhibit or Schedule to, or Article, Section, subsection
or clause in this Agreement.
(c) Each agreement defined in this Article I shall include all
appendices, exhibits and schedules thereto. Unless the prior written consent of
the Requisite Lenders is required hereunder for an amendment, restatement,
supplement or other modification to any such agreement and such consent is not
obtained, references in this Agreement to such agreement shall be to such
agreement as so amended, restated, supplemented or modified.
(d) References in this Agreement to any statute shall be to
such statute as amended or modified and in effect at the time any such reference
is operative.
(e) The term "INCLUDING" when used in any Loan Document means
"including without limitation" except when used in the computation of time
periods.
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(f) The terms "LENDER," "ISSUER" and "ADMINISTRATIVE AGENT"
include their respective successors.
(g) Upon the appointment of any successor Administrative Agent
pursuant to Section 9.6, references to CNAI in Section 9.3 and to Citibank in
the definitions of Base Rate, Eurodollar Rate shall be deemed to refer to the
financial institution then acting as the Administrative Agent or one of its
Affiliates if it so designates.
ARTICLE II
THE FACILITY
SECTION 2.1 THE REVOLVING CREDIT COMMITMENTS.
On the terms and subject to the conditions contained in this
Agreement, each Lender severally agrees to make loans (each a "REVOLVING LOAN")
in Dollars to the Borrower from time to time on any Business Day during the
period from and including the Effective Date until the Revolving Credit
Termination Date in an aggregate amount not to exceed at any time outstanding
for all such loans by such Lender such Lender's Revolving Credit Commitment,
which Revolving Credit Commitments are set forth in SCHEDULE I hereto; PROVIDED,
HOWEVER, that at no time shall any Lender be obligated to make a Revolving Loan
in excess of such Lender's Ratable Portion of the Available Credit. Within the
limits of each Lender's Revolving Credit Commitment, amounts of Revolving Loans
repaid may be reborrowed under this Section 2.1.
SECTION 2.2 BORROWING PROCEDURES.
(a) Each Borrowing shall be made on written notice (or verbal
notice followed by written notice within six hours of such verbal notice) given
by the Borrower to the Administrative Agent not later than 1:00 p.m. (New York
City time) (i) one Business Day, in the case of a Borrowing of Base Rate Loans
and (ii) three Business Days, in the case of a Borrowing of Eurodollar Rate
Loans, prior to the date of the proposed Borrowing. Each written notice shall be
in substantially the form of EXHIBIT D (a "NOTICE OF BORROWING") specifying (A)
the date of such proposed Borrowing, (B) the aggregate amount of such proposed
Borrowing, (C) whether any portion of the proposed Borrowing will be of Base
Rate Loans or Eurodollar Rate Loans, (D) the initial Interest Period or Periods
for any such Eurodollar Rate Loans, and (E) the Available Credit (after giving
effect to the proposed Borrowing). The Revolving Loans shall be made as Base
Rate Loans unless, subject to Section 2.13, the Notice of Borrowing specifies
that all or a portion thereof shall be Eurodollar Rate Loans. Notwithstanding
anything to the contrary contained in Section 2.3(a), if any Notice of Borrowing
requests a Borrowing of Base Rate Loans, the Administrative Agent may, in its
sole discretion, make a Swing Loan available to the Borrower in an aggregate
amount not to exceed such proposed Borrowing, and the aggregate amount of the
corresponding proposed Borrowing shall be reduced accordingly by the principal
amount of such Swing Loan. Each Borrowing of Eurodollar Rate Loans shall be in
an aggregate amount of not less than $5,000,000 or an integral multiple of
$1,000,000 in excess thereof and each Borrowing of Base Rate Loans shall be in
an aggregate amount of not less than $1,000,000 or an integral multiple of
$1,000,000 in excess thereof, or the remaining Available Credit, if less.
(b) The Administrative Agent shall give to each Lender prompt
notice of the Administrative Agent's receipt of a Notice of Borrowing and, if
Eurodollar Rate Loans are properly requested in such Notice of Borrowing, the
applicable interest rate determined pursuant to Section 2.13(a). Each Lender
shall, before 11:00 a.m. (New York City time) on the date of the proposed
Borrowing, make available to the Administrative Agent at its address referred to
in Section 10.8, in immediately available funds, such Lender's Ratable Portion
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of such proposed Borrowing. After the Administrative Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth in Section 3.1
and Section 3.2, the Administrative Agent will make such funds available to the
Borrower.
(c) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any proposed Borrowing that such Lender will
not make available to the Administrative Agent such Lender's Ratable Portion of
such Borrowing, the Administrative Agent may assume that such Lender has made
such Ratable Portion available to the Administrative Agent on the date of such
Borrowing in accordance with this Section 2.2 and the Administrative Agent may,
in reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such Ratable Portion available to the Administrative Agent, such Lender and
the Borrower severally agree to repay to the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower until the date such
amount is repaid to the Administrative Agent, at (i) in the case of the
Borrower, the interest rate applicable at the time to the Loans comprising such
Borrowing and (ii) in the case of such Lender, the Federal Funds Rate for the
first Business Day and thereafter at the interest rate applicable at the time to
the Loans comprising such Borrowing. If such Lender shall repay to the
Administrative Agent such corresponding amount, such corresponding amount so
repaid shall constitute such Lender's Loan as part of such Borrowing for
purposes of this Agreement. If the Borrower shall repay to the Administrative
Agent such corresponding amount, such payment shall not relieve such Lender of
any obligation it may have hereunder to the Borrower.
(d) The failure of any Lender to make the Loan or any payment
required by it on the date specified (a "NON-FUNDING LENDER"), including any
payment in respect of its participation in Swing Loans and Letter of Credit
Obligations, shall not relieve any other Lender of its obligations to make such
Loan or payment on such date but no such other Lender shall be responsible for
the failure of any Non-Funding Lender to make a Loan or payment required under
this Agreement.
SECTION 2.3 SWING LOANS.
(a) On the terms and subject to the conditions contained in
this Agreement, the Swing Loan Lender may in its sole discretion make loans
(each a "SWING LOAN") otherwise available to the Borrower under the Facility
from time to time on any Business Day during the period from the date hereof
until the Revolving Credit Termination Date in an aggregate amount at any time
outstanding (together with the aggregate principal amount of any other loans
made by the Swing Loan Lender hereunder in its capacity as a Lender or the Swing
Loan Lender) at any time not to exceed the lesser of $20,000,000 and the Swing
Loan Lender's Ratable Portion of the Available Credit at such time; PROVIDED,
HOWEVER, that the Swing Loan Lender shall not make any Swing Loan to the extent
that, after giving effect to such Swing Loan, the aggregate Revolving Credit
Outstandings would exceed the Maximum Credit. The Swing Loan Lender shall be
entitled to rely on the most recent Borrowing Base Certificate delivered to the
Administrative Agent. Each Swing Loan shall be a Base Rate Loan and must be
repaid in full within seven days of its making or, if sooner, upon any Borrowing
hereunder and shall in any event mature no later than the Revolving Credit
Termination Date. Within the limits set forth in the first sentence of this
Section 2.3(a) amounts of Swing Loans repaid may be reborrowed under this
Section 2.3(a).
(b) In order to request a Swing Loan, the Borrower shall
telecopy to the Administrative Agent a duly completed request setting forth the
date, the requested amount and date of the Swing Loan (a "SWING LOAN REQUEST"),
to be received by the Administrative Agent not later than 12:00 p.m. (New York
City time) on the day of the proposed borrowing. The Administrative Agent shall
promptly notify the Swing Loan Lender of the details of the requested Swing
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Loan. Subject to the terms of this Agreement, the Swing Loan Lender shall make a
Swing Loan available to the Administrative Agent which will make such amounts
available to the Borrower on the date of the relevant Swing Loan Request. The
Swing Loan Lender shall not make any Swing Loan in the period commencing on the
first Business Day after it receives written notice from any Lender or the
Administrative Agent (if a Person other than the Swing Loan Lender) that one or
more of the conditions precedent contained in Section 3.2 shall not on such date
be satisfied, and ending when such conditions are satisfied or waived. The Swing
Loan Lender shall not otherwise be required to determine that, or take notice
whether, the conditions precedent set forth in Section 3.2 hereof have been
satisfied in connection with the making of any Swing Loan.
(c) The Swing Loan Lender shall notify the Administrative
Agent in writing (which may be by telecopy) weekly, by no later than 10:00 a.m.
(New York City time) on the first Business Day of each week, of the aggregate
principal amount of its Swing Loans then outstanding.
(d) The Swing Loan Lender may demand at any time during the
continuance of an Event of Default that each Lender pay to the Administrative
Agent, for the account of the Swing Loan Lender, in the manner provided in
SUBSECTION (E) below, such Lender's Ratable Portion of all or a portion of the
outstanding Swing Loans, which demand shall be made through the Administrative
Agent, shall be in writing and shall specify the outstanding principal amount of
Swing Loans demanded to be paid.
(e) The Administrative Agent shall forward each notice
referred to in CLAUSE (C) above and each demand referred to in CLAUSE (D) above
to each Lender on the day such notice or such demand is received by the
Administrative Agent (except that any such notice or demand received by the
Administrative Agent after 2:00 p.m. (New York City time) on any Business Day or
any such demand received on a day that is not a Business Day shall not be
required to be forwarded to the Lenders by the Administrative Agent until the
next succeeding Business Day), together with a statement prepared by the
Administrative Agent specifying the amount of each Lender's Ratable Portion of
the aggregate principal amount of the Swing Loans stated to be outstanding in
such notice or demanded to be paid pursuant to such demand, and, notwithstanding
whether or not the conditions precedent set forth in Section 3.2 shall have been
satisfied (which conditions precedent the Lenders hereby irrevocably waive)
provided that the Swing Loan Lender has not received the notice referred to in
the penultimate sentence of CLAUSE (B) above prior to any such Swing Loan (and
the condition referred to in such notice has not been waived in accordance with
this Agreement), each Lender shall, before 11:00 a.m. (New York City time) on
the Business Day next succeeding the date of such Lender's receipt of such
written demand, make available to the Administrative Agent, in immediately
available funds, for the account of the Swing Loan Lender, the amount specified
in such demand. Upon such payment by a Lender, such Lender shall, except as
provided in CLAUSE (F) below, be deemed to have made a Revolving Loan to the
Borrower. The Administrative Agent shall use such funds to repay the Swing Loans
to the Swing Loan Lender. To the extent that any Lender fails to make such
payment available to the Administrative Agent for the account of the Swing Loan
Lender, the Borrower shall repay such Swing Loan on demand.
(f) Upon the occurrence of a Default under Section 8.1(f),
each Lender shall acquire, without recourse or warranty, an undivided
participation in each Swing Loan otherwise required to be repaid by such Lender
pursuant to CLAUSE (E) above, which participation shall be in a principal amount
equal to such Lender's Ratable Portion of such Swing Loan, by paying to the
Swing Loan Lender on the date on which such Lender would otherwise have been
required to make a payment in respect of such Swing Loan pursuant to CLAUSE (E)
above, in immediately available funds, an amount equal to such Lender's Ratable
Portion of such Swing Loan. If all or part of such amount is not in fact made
available by such Lender to the Swing Loan Lender on such date, the Swing Loan
Lender shall be entitled to recover any such unpaid amount on demand from such
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Lender together with interest accrued from such date at the Federal Funds Rate
for the first Business Day after such payment was due and thereafter at the rate
of interest then applicable to Base Rate Loans.
(g) From and after the date on which any Lender is deemed to
have made a Revolving Loan pursuant to CLAUSE (E) above with respect to any
Swing Loan or purchases an undivided participation interest in a Swing Loan
pursuant to CLAUSE (F) above, the Swing Loan Lender shall promptly distribute to
such Lender such Lender's Ratable Portion of all payments of principal of and
interest received by the Swing Loan Lender on account of such Swing Loan other
than those received from a Lender pursuant to CLAUSE (E) or (F) above.
SECTION 2.4 LETTERS OF CREDIT.
(a) Each Existing Letter of Credit is deemed to be a letter of
credit issued hereunder for all purposes of this Agreement and the other Loan
Documents. On the terms and subject to the conditions contained in this
Agreement, each Issuer agrees to Issue one or more Letters of Credit at the
request of the Borrower for the account of the Borrower from time to time on any
Business Day during the period commencing on the Effective Date and ending on
the earlier of the Revolving Credit Termination Date and 30 days prior to the
Scheduled Termination Date; PROVIDED, HOWEVER, that no Issuer shall be under any
obligation to Issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall purport by its terms to enjoin or
restrain such Issuer from Issuing such Letter of Credit or any
Requirement of Law applicable to such Issuer or any request or
directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over such Issuer shall
prohibit, or request that such Issuer refrain from, the Issuance of
letters of credit generally or such Letter of Credit in particular or
shall impose upon such Issuer with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which such Issuer is
not otherwise compensated) not in effect on the date of this Agreement
or result in any unreimbursed loss, cost or expense (for which such
Issuer is not otherwise compensated) that was not applicable, in effect
or known to such Issuer as of the date of this Agreement and that such
Issuer in good ▇▇▇▇▇ ▇▇▇▇▇ material to it;
(ii) such Issuer shall have received written notice from the
Administrative Agent, any Lender or the Borrower, on or prior to the
requested date of Issuance of such Letter of Credit, that one or more
of the applicable conditions contained in Section 3.2 and Section 2.4
is not then satisfied;
(iii) after giving effect to the Issuance of such Letter of
Credit, the aggregate Revolving Credit Outstandings would exceed the
Maximum Credit at such time;
(iv) after giving effect to the Issuance of such Letter of
Credit, the Letter of Credit Obligations at such time exceed 50% of the
aggregate Revolving Credit Commitments;
(v) any fees due in connection with a requested Issuance have
not been paid; or
(vi) such Letter of Credit is requested to be Issued in a form
that is not acceptable to such Issuer.
None of the Lenders (other than the Issuers in their capacity as such) shall
have any obligation to Issue any Letter of Credit.
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(b) In no event shall the expiration date of any Letter of
Credit, (i) be more than one year after the date of Issuance thereof, or (ii),
except as provided below, be less than thirty days prior to the Scheduled
Termination Date; PROVIDED, HOWEVER, that any Letter of Credit with a one-year
term may provide for the renewal thereof, prior to the Scheduled Termination
Date, for additional one-year periods (which shall in no event extend beyond the
expiry date referred to in clause (ii) above).
(c) In connection with the Issuance of each Letter of Credit,
the Borrower shall give the relevant Issuer and the Administrative Agent at
least two Business Days' prior written notice, in such written or electronic
form as is acceptable to the Issuer, of the requested Issuance of such Letter of
Credit (a "LETTER OF CREDIT Request"). Such notice shall be irrevocable and
shall specify the Issuer of such Letter of Credit, the stated amount of the
Letter of Credit requested, which stated amount shall not be less than $10,000,
the date of Issuance of such requested Letter of Credit (which day shall be a
Business Day), the date on which such Letter of Credit is to expire (which date
shall be a Business Day), and the Person for whose benefit the requested Letter
of Credit is to be Issued. Such notice, to be effective, must be received by the
relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York
City time) on the second Business Day prior to the requested Issuance of such
Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in
this Section 2.4, the relevant Issuer shall, on the requested date, Issue a
Letter of Credit on behalf of the Borrower and, if applicable, one of its
Subsidiaries in accordance with such Issuer's usual and customary business
practices. No Issuer shall Issue any Letter of Credit in the period commencing
on the first Business Day after it receives written notice from any Lender or
the Administrative Agent that one or more of the conditions precedent contained
in Section 3.2 shall not on such date be satisfied, and ending when such
conditions are satisfied. The relevant Issuer shall not otherwise be required to
determine that, or take notice whether, the conditions precedent set forth in
Section 3.2 have been satisfied in connection with the Issuance of any Letter of
Credit.
(e) Each Issuer shall comply with the following:
(i) give the Administrative Agent written notice (or
telephonic notice confirmed promptly thereafter in writing, which
writing may be by telecopier) of the Issuance of a Letter of Credit
Issued by it, of all drawings under a Letter of Credit Issued by it,
the payment (or the failure to pay when due) by the Borrower of any
Reimbursement Obligation when due (which notice the Administrative
Agent shall promptly transmit by telecopy or similar transmission to
each Lender);
(ii) upon the request of any Lender, furnish to such Lender
copies of such other documentation as may reasonably be requested by
such Lender; and
(iii) no later than 10 Business Days following the last day of
each calendar month, provide to the Administrative Agent (and the
Administrative Agent shall provide a copy to each Lender requesting the
same) and the Borrower, a schedule in form and substance reasonably
satisfactory to the Administrative Agent, setting forth the aggregate
Letter of Credit Obligations outstanding at the end of each month and
any information requested by the Borrower or the Administrative Agent
relating thereto.
(f) Immediately upon the Issuance by an Issuer of a Letter of
Credit in accordance with the terms and conditions of this Agreement, such
Issuer shall be deemed to have sold and transferred to each Lender, and each
Lender shall be deemed irrevocably and unconditionally to have purchased and
received from such Issuer, without recourse or warranty, an undivided interest
and participation, to the extent of such Lender's Ratable Portion, in such
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Letter of Credit and the obligations of the Borrower with respect thereto
(including all Letter of Credit Obligations with respect thereto) and any
security therefor and guaranty pertaining thereto.
(g) The Borrower agrees to pay to the Issuer of any Letter of
Credit the amount of all Reimbursement Obligations owing to such Issuer under
any Letter of Credit Issued for its account no later than the date that is the
next succeeding Business Day after the Borrower receives written notice from
such Issuer that payment has been made under such Letter of Credit (the
"REIMBURSEMENT DATE"), irrespective of any claim, set-off, defense or other
right that the Borrower may have at any time against such Issuer or any other
Person. In the event that any Issuer makes any payment under any Letter of
Credit and the Borrower shall not have repaid such amount to such Issuer
pursuant to this CLAUSE (G) on or before 11:00 a.m. (New York City time) on the
next Business Day following the Borrower's receipt of the aforesaid notice, then
(i) the relevant Issuer shall notify the Administrative Agent of such failure to
repay, (ii) such Reimbursement Obligation shall be payable on demand with
interest thereon computed from the date on which such Reimbursement Obligation
arose to the date of repayment in full at the rate of interest applicable to
past due Revolving Loans bearing interest at a rate based on the Base Rate
during such period, (iii) the Borrower shall be deemed to have elected (if a
formal notice of Borrowing has not been received by the Administrative Agent in
respect of such Reimbursement Obligation) to have the Reimbursement Obligation
satisfied by the Borrowing of a Base Rate Loan in an amount equal to such
Reimbursement Obligation and (iv) each Lender shall, except during the
continuance of a Default or Event of Default under Section 8.1(f) and
notwithstanding whether or not the conditions precedent set forth in Section 3.2
shall have been satisfied (which conditions precedent the Lenders hereby
irrevocably waive) provided that such Issuer has not received the notice
referred to in the penultimate sentence of CLAUSE (D) above (and the condition
referred to in such notice has not been waived in accordance with this
Agreement), pay to the Administrative Agent for the account of such Issuer the
amount of such Lender's Ratable Portion of such Reimbursement Obligations and be
deemed to have made a Revolving Loan to the Borrower in the principal amount of
such payment. Prior to the funding of such Revolving Loan, if the Administrative
Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any
Business Day, such Lender shall make available to the Administrative Agent for
the account of such Issuer its Ratable Portion of the amount of such payment on
such Business Day in immediately available funds. Whenever any Issuer receives
from the Borrower a payment of a Reimbursement Obligation as to which the
Administrative Agent has received for the account of such Issuer any payment
from a Lender pursuant to this CLAUSE (G), such Issuer shall pay to the
Administrative Agent and the Administrative Agent shall promptly pay to each
Lender, in immediately available funds, an amount equal to such Lender's Ratable
Portion of the amount of such payment adjusted, if necessary, to reflect the
respective amounts the Lenders have paid in respect of such Reimbursement
Obligation.
(h) The Borrower's obligation to pay each Reimbursement
Obligation and the obligations of the Lenders to make payments to the
Administrative Agent for the account of the Issuers with respect to Letters of
Credit shall be absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Agreement, under any and all
circumstances whatsoever, including the occurrence of any Default or Event of
Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of
Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure
from all or any of the provisions of any Letter of Credit or any Loan
Document;
(iii) the existence of any claim, set off, defense or other
right that the Borrower, any other party guaranteeing, or otherwise
obligated with, the Borrower, any Subsidiary or other Affiliate thereof
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or any other Person may at any time have against the beneficiary under
any Letter of Credit, any Issuer, the Administrative Agent or any
Lender or any other Person, whether in connection with this Agreement,
any other Loan Document or any other related or unrelated agreement or
transaction;
(iv) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any
respect;
(v) payment by the Issuer under a Letter of Credit against
presentation of a draft or other document that does not comply with the
terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of
any Issuer, the Lenders, the Administrative Agent or any other Person
or any other event or circumstance whatsoever, whether or not similar
to any of the foregoing, that might, but for the provisions of this
Section 2.4, constitute a legal or equitable discharge of the
Borrower's obligations hereunder.
Any action taken or omitted to be taken by the relevant Issuer under or in
connection with any Letter of Credit, if taken or omitted in the absence of
gross negligence or willful misconduct, shall not put such Issuer under any
resulting liability to the Borrower or any Lender. In determining whether drafts
and other documents presented under a Letter of Credit comply with the terms
thereof, the Issuer may accept documents that appear on their face to be in
order, without responsibility for further investigation, regardless of any
notice or information to the contrary and, in making any payment under any
Letter of Credit, the Issuer may rely exclusively on the documents presented to
it under such Letter of Credit as to any and all matters set forth therein,
including reliance on the amount of any draft presented under such Letter of
Credit, whether or not the amount due to the beneficiary thereunder equals the
amount of such draft and whether or not any document presented pursuant to such
Letter of Credit proves to be insufficient in any respect, if such document on
its face appears to be in order, and whether or not any other statement or any
other document presented pursuant to such Letter of Credit proves to be forged
or invalid or any statement therein proves to be inaccurate or untrue in any
respect whatsoever and any noncompliance in any immaterial respect of the
documents presented under such Letter of Credit with the terms thereof shall, in
each case, be deemed not to constitute willful misconduct or gross negligence of
the Issuer.
(i) If and to the extent such Lender shall not have so made
its Ratable Portion of the amount of the payment required by CLAUSE (G) above
available to the Administrative Agent for the account of such Issuer, such
Lender agrees to pay to the Administrative Agent for the account of such Issuer
forthwith on demand any such unpaid amount together with interest thereon, for
the first Business Day after payment was first due at the Federal Funds Rate,
and thereafter until such amount is repaid to the Administrative Agent for the
account of such Issuer, at the rate PER ANNUM applicable to Base Rate Loans
under the Facility. The failure of any Lender to make available to the
Administrative Agent for the account of such Issuer its Ratable Portion of any
such payment shall not relieve any other Lender of its obligation hereunder to
make available to the Administrative Agent for the account of such Issuer its
Ratable Portion of any payment on the date such payment is to be made, but no
Lender shall be responsible for the failure of any other Lender to make
available to the Administrative Agent for the account of the Issuer such other
Lender's Ratable Portion of any such payment.
(j) From time to time, the Borrower may by notice to the
Administrative Agent designate an additional Lender (in addition to CNAI) that
agrees (in its sole discretion) to act in such capacity is reasonably
satisfactory to the Administrative Agent as an Issuer. Each such additional
Issuer shall execute a counterpart of this Agreement upon the approval of the
Administrative Agent (which approval shall not be unreasonably withheld) and
shall thereafter be an Issuer hereunder for all purposes.
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SECTION 2.5 REDUCTION AND TERMINATION OF THE REVOLVING CREDIT
COMMITMENTS.
The Borrower may, upon same Business Day's notice to the
Administrative Agent, terminate in whole or reduce in part ratably the unused
portions of the respective Revolving Credit Commitments of the Lenders;
PROVIDED, HOWEVER, that (x) each partial reduction shall be in an aggregate
amount of not less than $10,000,000 or an integral multiple of $1,000,000 in
excess thereof and (y) no such termination or reduction of the Revolving Credit
Commitments shall be permitted if, after giving effect thereto and to any
repayments of the Revolving Loans made on the effective date thereof, the
aggregate Revolving Credit Outstandings would exceed the Total Revolving Credit
Commitments.
SECTION 2.6 REPAYMENT OF LOANS.
The Borrower promises to repay the entire unpaid principal
amount of the Revolving Loans, the Swing Loans and any Reimbursement Obligations
(unless required to be paid sooner hereunder), and cash collateralize all
outstanding Letters of Credit in accordance with Section 8.3, on the Revolving
Credit Termination Date.
SECTION 2.7 EVIDENCE OF DEBT.
(a) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing Indebtedness of the Borrower to such
Lender resulting from each Loan of such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Agreement.
(b) The Administrative Agent shall maintain accounts in
accordance with its usual practice in which it shall record (i) the amount of
each Loan made and, if a Eurodollar Rate Loan, the Interest Period applicable
thereto, (ii) the amount of any principal or interest due and payable by the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder from the Borrower, whether such sum
constitutes principal or interest, fees, expenses or other amounts due under the
Loan Documents and each Lender's Ratable Portion thereof, if applicable.
(c) The entries made in the accounts maintained pursuant to
CLAUSES (A) and (B) of this Section 2.7 shall, to the extent permitted by
applicable law, be PRIMA FACIE evidence of the existence and amounts of the
obligations recorded therein; PROVIDED, HOWEVER, that the failure of any Lender
or the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of the Borrower to repay the Loans in
accordance with their terms.
(d) Notwithstanding any other provision of the Agreement, in
the event that any Lender requests that the Borrower execute and deliver a
promissory note or notes payable to such Lender in order to evidence the
Indebtedness owing to such Lender by the Borrower hereunder, the Borrower will
promptly execute and deliver a Revolving Credit Note or Revolving Credit Notes
to such Lender evidencing any Revolving Loans of such Lender, substantially in
the form of EXHIBIT C.
SECTION 2.8 PREPAYMENTS.
(a) The Borrower may, upon at least three Business Days' prior
notice to the Administrative Agent, stating the proposed date and aggregate
principal amount of the prepayment, prepay the outstanding principal amount of
the Revolving Loans in whole or in part; PROVIDED, HOWEVER, that (i) if any
prepayment of any Eurodollar Rate Loan is made by the Borrower other than on the
last day of an Interest Period for such Loan, the Borrower shall also pay any
amounts owing pursuant to Section 2.13(e), (ii) each partial prepayment of
Eurodollar Loans shall be in an aggregate principal amount not less than
$5,000,000 or an integral multiple of $1,000,000 in excess thereof (or the
remaining balance of the Loans, if less) and each partial prepayment of Base
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Rate Loans shall be in an aggregate principal amount not less than $1,000,000 or
an integral multiple of $1,000,000 in excess thereof (or the remaining balance
of the Loans, if less) and (iii) the Borrower may prepay the outstanding
principal amount of any Swing Loan in whole or in part, with no minimum partial
prepayment requirement. Upon the giving of such notice of prepayment, the
principal amount of Revolving Loans specified to be prepaid shall become due and
payable on the date specified for such prepayment.
(b) The Borrower shall prepay Loans, or cash collateralize
outstanding Letters of Credit in accordance with Section 8.3, to the extent as a
result of Section 2.17 or any Scheduled Termination Date, and after giving
effect thereto, the aggregate Revolving Credit Outstandings would exceed the
then Lenders' total Revolving Credit Commitment, and otherwise shall have no
right to prepay the principal amount of any Loan other than as provided in this
Section 2.8.
SECTION 2.9 INTEREST.
(a) RATE OF INTEREST.
All Loans and the outstanding amount of all other Obligations
shall bear interest, in the case of Loans, on the unpaid principal amount
thereof from the date such Loans are made and, in the case of such other
Obligations, from the date such other Obligations are due and payable until, in
all cases, paid in full, except as otherwise provided in Section 2.9(c), as
follows:
(i) if a Base Rate Loan or such other Obligation, at a rate
PER ANNUM equal to the sum of (A) the Base Rate as in effect from time
to time, PLUS (B) the Applicable Margin; and
(ii) if a Eurodollar Rate Loan, at a rate PER ANNUM equal to
the sum of (A) the Eurodollar Rate determined for the applicable
Interest Period, PLUS (B) the Applicable Margin in effect from time to
time during such Interest Period.
(b) INTEREST PAYMENTS.
(i) Interest accrued on each Base Rate Loan (other than Swing
Loans) shall be payable in arrears (A) on the last day of each calendar
quarter, commencing on the first such day following the making of such
Base Rate Loan and (B) if not previously paid in full, at maturity
(whether by acceleration or otherwise) of such Base Rate Loan; (ii)
interest accrued on Swing Loans shall be payable in arrears on the last
day of each calendar quarter; (iii) interest accrued on each Eurodollar
Rate Loan shall be payable in arrears (A) on the last day of each
Interest Period applicable to such Loan and if such Interest Period has
a duration of more than three months, on each day during such Interest
Period occurring every three months from the first day of such Interest
Period, (B) upon the payment or prepayment thereof in full or in part
and (C) if not previously paid in full, at maturity (whether by
acceleration or otherwise) of such Eurodollar Rate Loan; and (iv)
interest accrued on the amount of all other Obligations shall be
payable on demand from and after the time such Obligation becomes due
and payable (whether by acceleration or otherwise).
(c) DEFAULT INTEREST.
Notwithstanding the rates of interest specified in Section
2.9(a) or elsewhere herein, effective immediately upon the occurrence of an
Event of Default, and for as long thereafter as such Event of Default shall be
continuing, the principal balance of all Loans and the amount of all other
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Obligations then due and payable shall bear interest at a rate that is two
percent PER ANNUM in excess of the rate of interest applicable to such
Obligations from time to time.
SECTION 2.10 CONVERSION/CONTINUATION OPTION.
(a) The Borrower may elect (i) at any time on any Business Day
to convert Base Rate Loans (other than Swing Loans) or any portion thereof to
Eurodollar Rate Loans, and (ii) at the end of any applicable Interest Period, to
convert Eurodollar Rate Loans or any portion thereof into Base Rate Loans or to
continue such Eurodollar Rate Loans or any portion thereof for an additional
Interest Period; PROVIDED, HOWEVER, that the aggregate amount of the Eurodollar
Loans for each Interest Period must be in the amount of $5,000,000 or an
integral multiple of $1,000,000 in excess thereof. Each conversion or
continuation shall be allocated among the Loans of each Lender in accordance
with its Ratable Portion. Each such election shall be in substantially the form
of EXHIBIT F (a "NOTICE OF CONVERSION OR CONTINUATION") and shall be made by
giving the Administrative Agent at least three Business Days' prior written
notice specifying (A) the amount and type of Loan being converted or continued,
(B) in the case of a conversion to or a continuation of Eurodollar Rate Loans,
the applicable Interest Period, and (C) in the case of a conversion, the date of
conversion.
(b) The Administrative Agent shall promptly notify each Lender
of its receipt of a Notice of Conversion or Continuation and of the options
selected therein. Notwithstanding the foregoing, no conversion in whole or in
part of Base Rate Loans to Eurodollar Rate Loans, and no continuation in whole
or in part of Eurodollar Rate Loans upon the expiration of any applicable
Interest Period, shall be permitted at any time at which (i) a Default or an
Event of Default shall have occurred and be continuing or (ii) the continuation
of, or conversion into, would violate or otherwise not be permitted under any of
the provisions of Section 2.13. If, within the time period required under the
terms of this Section 2.10, the Administrative Agent does not receive a Notice
of Conversion or Continuation from the Borrower containing a permitted election
to continue any Eurodollar Rate Loans for an additional Interest Period or to
convert any such Loans, then, upon the expiration of the applicable Interest
Period, such Loans shall be automatically converted to Base Rate Loans. Each
Notice of Conversion or Continuation shall be irrevocable.
SECTION 2.11 FEES.
(a) APPLICABLE UNUSED COMMITMENT FEE.
The Borrower agrees to pay to each Lender a commitment fee on
the daily average amount of the Unused Commitments from the date hereof until
the Revolving Credit Termination Date at the Applicable Unused Commitment Fee
Rate, payable in arrears (i) on the last day of each calendar quarter,
commencing on the first such day following the Effective Date and (ii) on the
Revolving Credit Termination Date.
(b) LETTER OF CREDIT FEES.
The Borrower agrees to pay the following amounts with respect
to Letters of Credit issued by any Issuer:
(i) to the Administrative Agent for the account of each Issuer
of a Letter of Credit, with respect to each Letter of Credit issued by
such Issuer, an issuance fee equal to 0.10% per annum of the maximum
amount available from time to time to be drawn under such Letter of
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Credit, payable in arrears (A) on the last day of each calendar
quarter, commencing on the first such day following the issuance of
such Letter of Credit and (B) on the Revolving Credit Termination Date;
and
(ii) to the Administrative Agent for the ratable benefit of
the Lenders, with respect to each Letter of Credit, a fee accruing at a
rate PER ANNUM equal to the Applicable Margin for Letters of Credit of
the maximum amount available from time to time to be drawn under such
Letter of Credit, payable in arrears (A) on the last day of each
calendar quarter, commencing on the first such day following the
issuance of such Letter of Credit and (B) on the Revolving Credit
Termination Date; PROVIDED, HOWEVER, that during the continuance of an
Event of Default, such fee shall be increased by two percent PER ANNUM
and shall be payable on demand.
(c) FACILITY FEES.
The Borrower shall pay:
(i) upon each Facility Extension, a fee to each Extending
Lender in an amount equal to such percentage of such Lender's Revolving
Credit Commitment outstanding on the Extension Date applicable to such
Facility Extension; and
(ii) upon the occurrence of a Facility Increase, a fee to each
Lender that participates in such Facility Increase (including any
Eligible Assignee that executes an Assumption Agreement in connection
with such Facility Increase) and each new Lender to be determined by
the Administrative Agent based on market conditions at the time of such
Facility Increase, which fee shall be payable in the Facility Increase
Effective Date.
(d) ADDITIONAL FEES.
The Borrower has agreed to pay to the Administrative Agent and
the Arrangers additional fees, the amount and dates of payment of which are
embodied in any separate fee letter entered into between or among such parties.
SECTION 2.12 PAYMENTS AND COMPUTATIONS.
(a) The Borrower shall make each payment hereunder (including
fees and expenses) not later than 1:00 p.m. (New York City time) on the day when
due, in Dollars, to the Administrative Agent at its address referred to in
Section 10.8 in immediately available funds without deduction, set-off or
counterclaim. The Administrative Agent will promptly thereafter cause to be
distributed immediately available funds relating to the payment of principal or
interest or fees to the Lenders, in accordance with the application of payments
set forth in CLAUSES (E) and (F) of this Section 2.12, as applicable, for the
account of their respective Applicable Lending Offices; PROVIDED, HOWEVER, that
amounts payable pursuant to Section 2.13(c), Section 2.13(e), Section 2.14 or
Section 2.15 shall be paid only to the affected Lender or Lenders and amounts
payable with respect to Swing Loans shall be paid only to the Swing Loan Lender.
Payments received by the Administrative Agent after 1:00 p.m. (New York City
time) shall be deemed to be received on the next Business Day.
(b) All computations of interest and of fees based on the Base
Rate shall be made by the Administrative Agent on the basis of a year of 365/366
days, as the case may be and all computations of all other interest and all fees
shall be made by the Administrative Agent on the basis of a year of 360 days, in
each case for the actual number of days (including the first day but excluding
the last day) occurring in the period for which such interest and fees are
payable. Each determination by the Administrative Agent of an interest rate
hereunder shall be conclusive and binding for all purposes, absent manifest
error.
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(c) Whenever any payment hereunder shall be stated to be due
on a day other than a Business Day, the due date for such payment shall be
extended to the next succeeding Business Day, and such extension of time shall
in such case be included in the computation of payment of interest or fees, as
the case may be; PROVIDED, HOWEVER, that if such extension would cause payment
of interest on or principal of any Eurodollar Rate Loan to be made in the next
calendar month, such payment shall be made on the immediately preceding Business
Day. All repayments of any Revolving Loans shall be applied as follows: FIRST,
to repay such Loans outstanding as Base Rate Loans and then to repay such Loans
outstanding as Eurodollar Rate Loans with those Eurodollar Rate Loans having
earlier expiring Interest Periods being repaid prior to those having later
expiring Interest Periods.
(d) Unless the Administrative Agent shall have received notice
from the Borrower to the Lenders prior to the date on which any payment is due
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent that the Borrower shall not have made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon at the Federal Funds Rate, for the first Business Day, and,
thereafter, at the rate applicable to Base Rate Loans, for each day from the
date such amount is distributed to such Lender until the date such Lender repays
such amount to the Administrative Agent.
(e) Subject to the provisions of Section 2.12(f) (and except
as otherwise provided in Section 2.8), all payments and any other amounts
received by the Administrative Agent from or for the benefit of the Borrower
shall be applied as follows: FIRST, to pay principal of and interest on any
portion of the Loans that the Administrative Agent may have advanced pursuant to
the express provisions of this Agreement on behalf of any Lender, for which the
Administrative Agent has not then been reimbursed by such Lender or the
Borrower, SECOND, to pay all other Obligations then due and payable, and THIRD,
as the Borrower so designates. Payments in respect of Swing Loans received by
the Administrative Agent shall be distributed to the Swing Loan Lender; payments
in respect of Revolving Loans received by the Administrative Agent shall be
distributed to each Lender in accordance with such Lender's Ratable Portion; and
all payments of fees and all other payments in respect of any other Obligation
shall be allocated among such of the Lenders and Issuers as are entitled
thereto, and, for such payments allocated to the Lenders, in proportion to their
respective Ratable Portions.
(f) During the continuance of an Event of Default, the
Borrower hereby irrevocably waives the right to direct the application of any
and all payments in respect of the Obligations and agrees that, notwithstanding
the provisions of CLAUSE (E) above, the Administrative Agent may, and shall upon
either (A) the written direction of the Requisite Lenders or (B) the
acceleration of the Obligations pursuant to Section 8.2, apply all payments
(subject in any event to the restrictions set forth in Section 8.3 in respect of
the application of amounts funded to a cash collateral account in respect of
outstanding Letter of Credit Obligations) in respect of any Obligations and all
funds on deposit in any cash collateral account in the following order:
(i) FIRST, to pay interest on and then principal of any
portion of the Revolving Loans which the Administrative Agent may have
advanced on behalf of any Lender for which the Administrative Agent has
not then been reimbursed by such Lender or the Borrower;
(ii) SECOND, to pay interest on and then principal of any
Swing Loan;
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(iii) THIRD, to pay Obligations in respect of any expense
reimbursements or indemnities then due the Administrative Agent;
(iv) FOURTH, to pay Obligations in respect of any expense
reimbursements or indemnities then due to the Lenders and the Issuers;
(v) FIFTH, to pay Obligations in respect of any fees then due
to the Administrative Agent, the Lenders and the Issuers;
(vi) SIXTH, to pay interest then due and payable in respect of
the Loans and Reimbursement Obligations;
(vii) SEVENTH, to pay or prepay principal payments on the
Loans and Reimbursement Obligations and to provide cash collateral for
outstanding Letter of Credit Undrawn Amounts in the manner described in
Section 8.3, ratably to the aggregate principal amount of such Loans,
Reimbursement Obligations and Letter of Credit Undrawn Amounts; and
(viii) EIGHTH, to the ratable payment of all other
Obligations;
PROVIDED, HOWEVER, that if sufficient funds are not available to fund all
payments to be made in respect of any Obligation described in any of clauses
first through eighth, the available funds being applied with respect to any such
Obligation (unless otherwise specified in such clause) shall be allocated to the
payment of such Obligations ratably, based on the proportion of the
Administrative Agent's and each Lender's or Issuer's interest in the aggregate
outstanding Obligations described in such clauses. The order of priority set
forth in clauses first through eighth of this CLAUSE (F) may at any time and
from time to time be changed by the agreement of all Lenders without necessity
of notice to or consent of or approval by the Borrower, or any other Person. The
order of priority set forth in clauses first through fifth of this CLAUSE (F)
may be changed only with the prior written consent of the Administrative Agent
in addition to all Lenders.
(g) At the option of the Administrative Agent, principal on
the Swing Loans, Reimbursement Obligations, interest, fees, expenses and other
sums due and payable in respect of the Revolving Loans may be paid from the
proceeds of Swing Loans or Revolving Loans. The Borrower hereby authorizes the
Swing Loan Lender to make Swing Loans pursuant to Section 2.3(a), and the
Lenders to make Revolving Loans pursuant to Section 2.2(a), from time to time in
the Swing Loan Lender's, or such Lender's discretion, that are in the amounts of
any and all principal payable with respect to the Swing Loans and interest,
fees, expenses and other sums payable in respect of the Revolving Loans, and
further authorizes the Administrative Agent to give the Lenders notice of any
Borrowing with respect to such Swing Loans and Revolving Loans and to distribute
the proceeds of such Swing Loans and Revolving Loans to pay such amounts. The
Borrower agrees that all such Swing Loans and Revolving Loans so made shall be
deemed to have been requested by it (irrespective of the satisfaction of the
conditions in Section 3.2, which conditions the Lenders irrevocably waive) and
directs that all proceeds thereof shall be used to pay such amounts.
SECTION 2.13 SPECIAL PROVISIONS GOVERNING EURODOLLAR RATE
LOANS.
(a) DETERMINATION OF INTEREST RATE.
The Eurodollar Rate for each Interest Period for Eurodollar
Rate Loans shall be determined by the Administrative Agent pursuant to the
procedures set forth in the definition of "EURODOLLAR RATE." The Administrative
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Agent's determination shall be presumed to be correct, absent manifest error,
and shall be binding on the Borrower.
(b) INTEREST RATE UNASCERTAINABLE, INADEQUATE OR UNFAIR.
In the event that: (i) the Administrative Agent determines
that adequate and fair means do not exist for ascertaining the applicable
interest rates by reference to which the Eurodollar Rate then being determined
is to be fixed; or (ii) the Requisite Lenders notify the Administrative Agent
that the Eurodollar Rate for any Interest Period will not adequately reflect the
cost to such Lenders of making or maintaining such Loans for such Interest
Period, the Administrative Agent shall forthwith so notify the Borrower and the
Lenders, whereupon each Eurodollar Loan shall automatically, on the last day of
the current Interest Period for such Loan, convert into a Base Rate Loan and the
obligations of the Lenders to make Eurodollar Rate Loans or to convert Base Rate
Loans into Eurodollar Rate Loans shall be suspended until the Administrative
Agent shall notify the Borrower that the Requisite Lenders have determined that
the circumstances causing such suspension no longer exist.
(c) INCREASED COSTS.
If at any time any Lender determines that the introduction of
or any change in or in the interpretation of any law, treaty or governmental
rule, regulation or order (other than any change by way of imposition or
increase of reserve requirements included in determining the Eurodollar Rate) or
the compliance by such Lender with any guideline, request or directive from any
central bank or other Governmental Authority (whether or not having the force of
law), shall have the effect of increasing the cost to such Lender of agreeing to
make or making, funding or maintaining any Eurodollar Rate Loans, then the
Borrower shall from time to time, upon demand by such Lender (with a copy of
such demand to the Administrative Agent), pay to the Administrative Agent for
the account of such Lender additional amounts sufficient to compensate such
Lender for such increased cost. A certificate as to the amount of such increased
cost, submitted to the Borrower and the Administrative Agent by such Lender,
shall be conclusive and binding for all purposes, absent manifest error.
(d) ILLEGALITY.
Notwithstanding any other provision of this Agreement, if any
Lender determines that the introduction of or any change in or in the
interpretation of any law, treaty or governmental rule, regulation or order
after the date of this Agreement shall make it unlawful, or any central bank or
other Governmental Authority shall assert that it is unlawful, for any Lender or
its Eurodollar Lending Office to make Eurodollar Rate Loans or to continue to
fund or maintain Eurodollar Rate Loans, then, on notice thereof and demand
therefor by such Lender to the Borrower through the Administrative Agent, (i)
the obligation of such Lender to make or to continue Eurodollar Rate Loans and
to convert Base Rate Loans into Eurodollar Rate Loans shall be suspended, and
each such Lender shall make a Base Rate Loan as part of any requested Borrowing
of Eurodollar Rate Loans and (ii) if the affected Eurodollar Rate Loans are then
outstanding, the Borrower shall immediately convert each such Loan into a Base
Rate Loan. If at any time after a Lender gives notice under this Section 2.13(d)
such Lender determines that it may lawfully make Eurodollar Rate Loans, such
Lender shall promptly give notice of that determination to the Borrower and the
Administrative Agent, and the Administrative Agent shall promptly transmit the
notice to each other Lender. The Borrower's right to request, and such Lender's
obligation, if any, to make Eurodollar Rate Loans shall thereupon be restored.
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(e) BREAKAGE COSTS.
In addition to all amounts required to be paid by the Borrower
pursuant to Section 2.9, the Borrower shall compensate each Lender, upon demand,
for all losses, expenses and liabilities (including any loss or expense incurred
by reason of the liquidation or reemployment of deposits or other funds acquired
by such Lender to fund or maintain such Lender's Eurodollar Rate Loans to the
Borrower but excluding any loss of the Applicable Margin on the relevant Loans)
which that Lender may sustain (i) if for any reason a proposed Borrowing,
conversion into or continuation of Eurodollar Rate Loans does not occur on a
date specified therefor in a Notice of Borrowing or a Notice of Conversion or
Continuation given by a Borrower or in a telephonic request by it for borrowing
or conversion or continuation or a successive Interest Period does not commence
after notice therefor is given pursuant to Section 2.10, (ii) if for any reason
any Eurodollar Rate Loan is prepaid (including (x) as a result of any conversion
into a Base Rate Loan on a date which is not the last day of the applicable
Interest Period, (iii) as a consequence of a required conversion of a Eurodollar
Rate Loan to a Base Rate Loan as a result of any of the events indicated in
Section 2.13(d), or (iv) as a consequence of any failure by a Borrower to repay
Eurodollar Rate Loans when required by the terms hereof. The Lender making
demand for such compensation shall deliver to the Borrower concurrently with
such demand a written statement as to such losses, expenses and liabilities, and
this statement shall be conclusive as to the amount of compensation due to such
Lender, absent manifest error.
SECTION 2.14 CAPITAL ADEQUACY.
If at any time any Lender determines that (a) the adoption of
or any change in or in the interpretation of any law, treaty or governmental
rule, regulation or order after the date of this Agreement regarding capital
adequacy, (b) compliance with any such law, treaty, rule, regulation, or order,
or (c) compliance with any guideline or request or directive from any central
bank or other Governmental Authority (whether or not having the force of law)
shall have the effect of reducing the rate of return on such Lender's (or any
corporation controlling such Lender's) capital as a consequence of its
obligations hereunder or under or in respect of any Letter of Credit to a level
below that which such Lender or such corporation could have achieved but for
such adoption, change, compliance or interpretation, then, upon demand from time
to time by such Lender (with a copy of such demand to the Administrative Agent),
the Borrower shall pay to the Administrative Agent for the account of such
Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender for such reduction. A certificate as to
such amounts submitted to the Borrower and the Administrative Agent by such
Lender shall be conclusive and binding for all purposes absent manifest error.
SECTION 2.15 TAXES.
(a) Any and all payments by any Loan Party under each Loan
Document shall be made free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, excluding (i) in the case of each
Lender and the Administrative Agent (A) taxes measured by its net income, and
franchise taxes imposed on it, by the jurisdiction (or any political subdivision
thereof) under the laws of which such Lender or the Administrative Agent (as the
case may be) is organized and (B) any United States withholding taxes payable
with respect to payments under the Loan Documents under laws (including any
statute, treaty or regulation) in effect on the Effective Date (or, in the case
of an Eligible Assignee, the date of the Assignment and Acceptance) applicable
to such Lender or the Administrative Agent, as the case may be, but not
excluding any United States withholding taxes payable as a result of any change
in such laws occurring after the Effective Date (or the date of such Assignment
and Acceptance) and (ii) in the case of each Lender, taxes measured by its net
income, and franchise taxes imposed on it as a result of a present or former
connection (but not any such connection arising solely from the Administrative
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Agent or such Lender having executed, delivered or performed its obligations or
received a payment under, or enforced, this Agreement or any other Loan
Document) between such Lender and the jurisdiction of the Governmental Authority
imposing such tax or any taxing authority thereof or therein (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "TAXES"). If any Taxes shall be
required by law to be deducted from or in respect of any sum payable under any
Loan Document to any Lender or the Administrative Agent (w) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 2.15 such Lender or the Administrative Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (x) the relevant Loan Party shall make such deductions,
(y) the relevant Loan Party shall pay the full amount deducted to the relevant
taxing authority or other authority in accordance with applicable law, and (z)
the relevant Loan Party shall deliver to the Administrative Agent evidence of
such payment.
(b) In addition, the Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies of the United States or any political subdivision thereof or
any applicable foreign jurisdiction, and all liabilities with respect thereto,
which arise from any payment made under any Loan Document or from the execution,
delivery or registration of, or otherwise with respect to, any Loan Document
(collectively, "OTHER TAXES").
(c) Except for amounts due as a result of a breach of a
Lender's obligations under Section 2.15(f), the Borrower will indemnify each
Lender and the Administrative Agent for the full amount of Taxes and Other Taxes
(including any Taxes and Other Taxes imposed by any jurisdiction on amounts
payable under this Section 2.15 paid by such Lender or the Administrative Agent
(as the case may be) and any liability (including for penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted. This indemnification shall be
made within 30 days from the date such Lender or the Administrative Agent (as
the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes or
Other Taxes by any Loan Party, the Borrower shall furnish to the Administrative
Agent, at its address referred to in Section 10.8, the original or a certified
copy of a receipt evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 2.15 shall survive the payment in full of the
Obligations.
(f) On or prior to the Effective Date in the case of each
Non-U.S. Lender that is a signatory hereto, and on the date of the Assignment
and Acceptance pursuant to which it becomes a Lender in the case of each other
Non-U.S. Lender and from time to time thereafter if requested by the Borrower or
the Administrative Agent, each Non-U.S. Lender that is entitled at such time to
an exemption from United States withholding tax, or that is subject to such tax
at a reduced rate under an applicable tax treaty, shall provide the
Administrative Agent and the Borrower with two completed originals of the
following: (i) Form W-8ECI (claiming exemption from withholding because the
income is effectively connected with a U.S. trade or business) (or any successor
form); (ii) Form W-8BEN (claiming exemption from, or a reduction of, withholding
tax under an income tax treaty) (or any successor form); (iii) in the case of a
Non-U.S. Lender claiming exemption under Sections 871(h) or 881(c) of the Code,
a Form W-8BEN (claiming exemption from withholding under the portfolio interest
exemption) or any successor form; or (iv) any other applicable form, certificate
or document prescribed by the IRS certifying as to such Non-U.S. Lender's
entitlement to such exemption from United States withholding tax or reduced rate
with respect to all payments to be made to such Non-U.S. Lender under the Loan
Documents. Unless the Borrower and the Administrative Agent have received forms
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or other documents satisfactory to them indicating that payments under any Loan
Document to or for a Non-U.S. Lender are not subject to United States
withholding tax or are subject to such tax at a rate reduced by an applicable
tax treaty, the Borrower or the Administrative Agent shall withhold amounts
required to be withheld by applicable Requirements of Law from such payments at
the applicable statutory rate.
(g) Any Lender claiming any additional amounts payable
pursuant to this Section 2.15 shall use its reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Applicable Lending Office if the making of such a change
would avoid the need for, or reduce the amount of, any such additional amounts
that would be payable or may thereafter accrue and would not, in the sole
determination of such Lender, be otherwise disadvantageous to such Lender.
SECTION 2.16 SUBSTITUTION OF LENDERS.
In the event that (a) (i) any Lender makes a claim under
Section 2.13(c) or Section 2.14, or (ii) it becomes illegal for any Lender to
continue to fund or make any Eurodollar Rate Loan and such Lender notifies the
Borrower pursuant to Section 2.13(d), or (iii) the Borrower is required to make
any payment pursuant to Section 2.15 that is attributable to any Lender, or (iv)
any Lender is a Non-Funding Lender, or (v) any Lender is a Rejecting Lender
pursuant to Section 2.17, (b) in the case of CLAUSE (A)(I) above, as a
consequence of increased costs in respect of which such claim is made, the
effective rate of interest payable to such Lender under this Agreement with
respect to its Loans materially exceeds the effective average annual rate of
interest payable to the Requisite Lenders under this Agreement and (c) Lenders
holding at least 75% of the Revolving Credit Commitments are not subject to such
increased costs or illegality, payment or proceedings (any such Lender, an
"AFFECTED LENDER"), the Borrower may substitute another financial institution
for such Affected Lender hereunder, upon reasonable prior written notice (which
written notice must be given within 90 days following the occurrence of any of
the events described in CLAUSES (A)(I), (II), (III) OR (IV)) by the Borrower to
the Administrative Agent and the Affected Lender that the Borrower intends to
make such substitution, which substitute financial institution must be an
Eligible Assignee and, if not a Lender, reasonably acceptable to the
Administrative Agent; PROVIDED, HOWEVER, that if more than one Lender claims
increased costs, illegality or right to payment arising from the same act or
condition and such claims are received by the Borrower within 30 days of each
other then the Borrower may substitute all, but not (except to the extent the
Borrower has already substituted one of such Affected Lenders before the
Borrower's receipt of the other Affected Lenders' claim) less than all, Lenders
making such claims. In the event that the proposed substitute financial
institution or other entity is reasonably acceptable to the Administrative Agent
and the written notice was properly issued under this Section 2.16, the Affected
Lender shall sell and the substitute financial institution or other entity shall
purchase at par, pursuant to an Assignment and Acceptance, all rights and claims
of such Affected Lender under the Loan Documents and the substitute financial
institution or other entity shall assume and the Affected Lender shall be
relieved of its Revolving Credit Commitments and all other prior unperformed
obligations of the Affected Lender under the Loan Documents (other than in
respect of any damages (other than exemplary or punitive damages, to the extent
permitted by applicable law) in respect of any such unperformed obligations).
Upon the effectiveness of such sale, purchase and assumption (which, in any
event shall be conditioned upon the payment in full by the Borrower to the
Affected Lender in cash of all fees, unreimbursed costs and expenses and
indemnities accrued and unpaid through such effective date), the substitute
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financial institution or other entity shall become a "LENDER" hereunder for all
purposes of this Agreement having a Revolving Credit Commitment in the amount of
such Affected Lender's Revolving Credit Commitment assumed by it and such
Revolving Credit Commitment of the Affected Lender shall be terminated, provided
that all indemnities under the Loan Documents shall continue in favor of such
Affected Lender.
SECTION 2.17 FACILITY EXTENSION.
(a) EXTENSION REQUESTS. The Borrower may request a one-year
extension of the Scheduled Termination Date by submitting a request for an
extension to the Administrative Agent no more than 120 days nor less than 90
days prior to each anniversary of the Effective Date. At the time of or prior to
the delivery of such request, the Borrower shall propose to the Administrative
Agent the amount of the fees that the Borrower agrees to pay with respect to
such one-year extension if approved by Lenders (such request for an extension,
together with the fee proposal, being herein referred to as the "EXTENSION
REQUEST"). Promptly upon (but not later than five (5) Business Days after)
receipt of the Extension Request, the Administrative Agent shall notify each
Lender of the contents thereof and shall request each Lender to approve the
Extension Request. Each Lender approving the Extension Request shall deliver its
written approval no later than sixty (60) days after the date of the Extension
Request. If the approval of all Lenders is received by the Administrative Agent
within sixty (60) days after the date of the Extension Request (or as otherwise
provided in Section 2.17(b)), the Administrative Agent shall promptly so notify
the Borrower and each Lender, and the Scheduled Termination Date shall be
extended by one (1) year, and in such event the Borrower may thereafter request
further extension(s) of the then scheduled Scheduled Termination Date in
accordance with this Section 2.17. If any Lender does not deliver to the
Administrative Agent such Lender's written approval to any Extension Request
within sixty (60) days after the date of such Extension Request, the Scheduled
Termination Date shall not be extended, except as otherwise provided in Section
2.17(b) or 2.17(c).
(b) REJECTING LENDERS/FULL ASSIGNMENT. If (i) any Lenders
whose pro rata shares of the aggregate Revolving Credit Commitment do not exceed
25% of the Aggregate Commitment ("REJECTING LENDERS") shall not approve an
Extension Request, (ii) all rights and obligations of such Rejecting Lenders
under this Agreement and under the other Loan Documents and Guaranties
(including, without limitation, their Commitment and all Loans owing to them)
shall have been assigned, within ninety (90) days following such Extension
Request, in accordance with Section 2.16, to one or more replacement Lenders who
shall have approved in writing such Extension Request at the time of such
assignment, and (iii) no other Lender shall have given written notice to the
Administrative Agent of such Lender's withdrawal of its approval of the
Extension Request, the Administrative Agent shall promptly so notify the
Borrower and each Lender, and the Scheduled Termination Date shall be extended
by one (1) year, and in such event the Borrower may thereafter request further
extension(s) as provided in Section 2.17(a).
(c) REJECTING LENDERS/NO FULL ASSIGNMENT. If (i) one or more
Rejecting Lenders shall not approve an Extension Request, (ii) the provisions of
clause (ii) of Section 2.17(b) do not apply and (iii) no other Lender shall have
given written notice to the Administrative Agent of such Lender's withdrawal of
its approval of the Extension Request, the Administrative Agent shall promptly
notify the Borrower and each Lender and any replacement Lender, and the
Scheduled Termination Date shall be extended by one (1) year (subject to the
limitations set forth in this Section 2.17(c)), and in such event the Borrower
may thereafter request further extension(s) as provided in Section 2.17(a);
provided, however, that (A) the aggregate Revolving Credit Commitment shall be
automatically reduced, effective as of the Scheduled Termination Date as
determined prior to such extension (the "PREVIOUS SCHEDULED TERMINATION DATE")
and shall equal the aggregate Commitments of Lenders who are not Rejecting
Lenders and Lenders who are replacement Lenders; (B) all rights and obligations
of such Rejecting Lenders under this Agreement and under the other Loan
Documents (including, without limitation, their Commitment and all Loans owing
to them) shall either be (1) assigned to replacement Lenders pursuant to Section
2.17(b), or (2) terminated, effective as of the previous Scheduled Termination
Date (or such earlier date as the Borrower and the Administrative Agent may
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designate, in which case the reduction of the aggregate Revolving Credit
Commitment provided for in clause (A) above shall occur on such earlier date);
(C) if and to the extent such Rejecting Lender's Commitment is assigned to one
or more replacement Lenders, such assignment shall be effected in accordance
with the provisions of Section 2.16; and (D) if and to the extent such Rejecting
Lender's Commitment is terminated, the Borrower shall pay to Administrative
Agent on the date of such termination, solely for the account of such Rejecting
Lender, all amounts due and owing such Rejecting Lender hereunder or under any
other Loan Document, including without limitation the aggregate outstanding
principal amount of the Loans owed to such Rejecting Lender with respect to the
terminated Commitment, together with accrued interest thereon through the date
of such termination, all amounts payable under Section 2.13 and 2.14 with
respect to such Rejecting Lender and all fees payable to such Rejecting Lender
hereunder with respect to the terminated Commitment (and payment of such amount
may not be waived except with the consent of each Rejecting Lender, as more
specifically provided in Section 10.1(a)(ii)); and upon such Rejecting Lender's
termination, such Rejecting Lender shall cease to be a party hereto but shall
continue to be entitled to the benefits of Sections 2.13 and 2.14 and Sections
10.3 and 10.4, as well as to any fees accrued hereunder and not yet paid, and
shall continue to be obligated under Section 9.5 with respect to obligations and
liabilities accruing prior to such termination of such Rejecting Lender's
Commitment.
(d) APPROVAL OF EXTENSION. Within ten (10) days after the
Administrative Agent's notice to the Borrower that all (or some, as applicable)
of Lenders have approved an Extension Request (whether pursuant to Section
2.17(a), (b) or (c)), the Borrower shall pay to the Administrative Agent for the
account of each Lender approving the extension and each Replacement Lender an
extension fee in the amount provided in the Extension Request.
(e) NO DEFAULT. Notwithstanding anything to the contrary
contained herein, no extension of the Scheduled Termination Date may be effected
under this Section 2.17 if (x) a Default or Event of Default shall be in
existence on the effective date of such extension or would occur after giving
effect thereto or (y) any representation or warranty made or deemed made by the
Borrower in any Loan Document or any Guarantor in any Guaranty is not or would
not be true or correct in any material respect on the effective date of such
increase (except to the extent any such representation or warranty is stated to
relate solely to an earlier date, in which case such representation or warranty
shall be true and correct on and as of such earlier date).
SECTION 2.18 FACILITY INCREASE.
The Borrower may request, in writing, an increase in the
aggregate Revolving Credit Commitments by up to the sum of (x) $150,000,000 and
(y) the aggregate amount of the Revolving Credit Commitments of the Rejecting
Lenders that have been terminated on their Scheduled Termination Date (the
"FACILITY INCREASE"); PROVIDED, HOWEVER, that such increase will only become
effective if (i) the Borrower shall have given the Administrative Agent at least
10 Business Days' notice of its intention to effect a Facility Increase and the
desired amount of such Facility Increase, (ii) at the time of and after giving
effect to such increase, the Borrower is in PRO FORMA compliance with the
financial covenants set forth in ARTICLE V hereof, (iii) no Default or Event of
Default has occurred and is continuing or would result therefrom, and (iv) the
conditions precedent to a Borrowing set forth in Section 3.2 are satisfied as of
such date. The Borrower shall have the right to offer such increase to (x) the
existing Lenders, and each existing Lender will have the right, but not the
obligation, to commit to all or a portion of the proposed increase or (y) other
Eligible Assignees acceptable to the Administrative Agent and each Issuer in its
respective sole and absolute discretion; PROVIDED, HOWEVER, that the minimum
Revolving Credit Commitment of each such new Eligible Assignee accepting a
Revolving Credit Commitment as part of such Facility Increase equals or exceeds
$5,000,000, and such Lender or Eligible Assignee executes an Assumption
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Agreement pursuant to which such Lender agrees to commit to all or a portion of
such Facility Increase and, in the case of an Eligible Assignee, to be bound by
the terms of this Agreement as a Lender. On the effective date provided for in
the Assumption Agreement providing for a Facility Increase (each a "FACILITY
INCREASE EFFECTIVE DATE"), the Revolving Credit Commitments will be increased by
the amount committed to by each Lender or Eligible Assignee on the Facility
Increase Effective Date. In the event there are Lenders and Eligible Assignees
that have committed to a Facility Increase in excess of the maximum amount
requested (or permitted), then the Administrative Agent shall have the right to
allocate such commitments, first to Lenders and then to Eligible Assignees, on
whatever basis the Administrative Agent determines is appropriate in
consultation with the Borrower.
ARTICLE III
CONDITIONS TO LOANS AND LETTERS OF CREDIT
SECTION 3.1 CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF THIS
AGREEMENT.
This Agreement shall be effective on the date (the "EFFECTIVE
DATE") on which all of the following conditions precedent have been first
satisfied (unless waived by the Requisite Lenders or unless the time for
satisfaction thereof has been extended by the Administrative Agent):
(a) CERTAIN DOCUMENTS.
The Administrative Agent shall have received on the Effective
Date each of the following, each dated the Effective Date unless otherwise
indicated or agreed to by the Administrative Agent, in form and substance
satisfactory to the Administrative Agent and (except for any Revolving Credit
Notes) in sufficient copies for each Lender:
(i) this Agreement, duly executed and delivered by the
Borrower and each Lender, and, for the account of each Lender
requesting the same, a Revolving Credit Note or Revolving Credit Notes
of the Borrower conforming to the requirements set forth herein;
(ii) the Guaranty, duly executed and delivered by each
Restricted Subsidiary of the Borrower, such that after giving effect
thereto, the Borrower would be in compliance with Section 6.13;
(iii) a favorable opinion of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLP, counsel
to the Loan Parties in substantially the form of EXHIBIT G;
(iv) a copy of the articles or certificate of incorporation
(or equivalent Constituent Document) of each Loan Party, certified as
of a recent date by the Secretary of State of the state of organization
or formation of such Loan Party, together with certificates of such
official attesting to the good standing of each such Loan Party;
(v) a certificate of the Secretary or an Assistant Secretary
of each Loan Party certifying (A) the names and true signatures of each
officer of such Loan Party who has been authorized to execute and
deliver any Loan Document or other document required hereunder to be
executed and delivered by or on behalf of such Loan Party, (B) the
by-laws (or equivalent Constituent Document) of such Loan Party as in
effect on the date of such certification, (C) the resolutions of such
Loan Party's Board of Directors (or equivalent governing body)
approving and authorizing the execution, delivery and performance of
this Agreement and the other Loan Documents to which it is a party and
(D) that there have been no changes in the certificate of incorporation
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(or equivalent Constituent Document) of such Loan Party from the
certificate of incorporation (or equivalent Constituent Document)
delivered pursuant to the immediately preceding clause;
(vi) a certificate of a Responsible Officer to the effect that
(A) there is no Default or Event of Default which has occurred and is
continuing under this Agreement and (B) the representations and
warranties set forth in Article IV and in the other Loan Documents
shall be true and correct as of the Effective Date, except to the
extent such representations and warranties expressly relate to an
earlier date, in which case such representation and warranties shall
have been true and correct on and as of such earlier date;
(vii) a Borrowing Base Certificate otherwise complying with
the provisions of Section 6.1(i) as of the last day of the month
immediately preceding the Effective Date; and
(viii) such other certificates, documents, agreements and
information respecting any Loan Party as any Lender through the
Administrative Agent may reasonably request.
(b) FEE AND EXPENSES PAID.
There shall have been paid to the Administrative Agent, for
the account of the Administrative Agent and the Lenders, as applicable, all fees
due and payable on or before the Effective Date (including all such fees
described in any fee letter referred to in Section 2.11(d) and all reasonable
fees and expenses of counsel for which invoices in reasonable detail have been
presented), and all expenses due and payable on or before the Effective Date.
(c) CONSENTS, ETC.
Each of the Borrower and its Restricted Subsidiaries shall
have received all material consents and authorizations required pursuant to any
material Contractual Obligation with any other Person and shall have obtained
all material consents and authorizations of, and effected all notices to and
filings with, any Governmental Authority, in each case, as may be necessary to
allow each of the Borrower and its Restricted Subsidiaries lawfully to execute,
deliver and perform, in all material respects, their respective obligations
hereunder, and under the Loan Documents to which each of them, respectively, is,
or shall be, a party and each other agreement or instrument to be executed and
delivered by each of them, respectively, pursuant thereto or in connection
therewith.
(d) EXISTING CREDIT AGREEMENT.
The Borrower and its Subsidiaries shall have delivered
evidence (satisfactory in form and substance to the Administrative Agent) of the
termination of the commitments under, and the payment of all amounts owing
under, the Company's Existing Credit Agreement and delivered to the
Administrative Agent all documents or instruments necessary to release all Liens
securing all Indebtedness or other obligations of the Borrower and its
Subsidiaries thereunder and made arrangements satisfactory to the Administrative
Agent with respect to the rollover of any letters of credit outstanding
thereunder.
SECTION 3.2 CONDITIONS PRECEDENT TO EACH LOAN AND LETTER OF
CREDIT.
The obligation of each Lender on any date (including the
Effective Date) to make any Loan and of each Issuer on any date (including the
Effective Date) to Issue any Letter of Credit is subject to the satisfaction of
each of the following conditions precedent:
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(a) REQUEST FOR BORROWING OR ISSUANCE OF LETTER OF CREDIT.
With respect to any Loan, the Administrative Agent shall have
received a duly executed Notice of Borrowing (or, in the case of Swing Loan, a
duly executed Swing Loan Request) and with respect to any Letter of Credit, the
Administrative Agent and the Issuer shall have received a duly executed Letter
of Credit Request.
(b) REPRESENTATIONS AND WARRANTIES; NO DEFAULTS.
The following statements shall be true on and as of the date
of such Loan or Issuance, both before and after giving effect thereto and, in
the case of any Loan, to the application of the proceeds therefrom:
(i) the representations and warranties set forth in Article IV
and in the other Loan Documents shall be true and correct on and as of
the Effective Date and shall be true and correct in all material
respects on and as of any such date after the Effective Date with the
same effect as though made on and as of such date, except to the extent
such representations and warranties expressly relate to an earlier
date, in which case such representation and warranties shall have been
true and correct on and as of such earlier date; and
(ii) no Default or Event of Default has occurred and is
continuing.
(c) ADDITIONAL MATTERS.
The Administrative Agent shall have received such additional
documents, information and materials as any Lender, through the Administrative
Agent, may reasonably request.
Each submission by the Borrower to the Administrative Agent of a Notice of
Borrowing or a Swing Loan Request and the acceptance by the Borrower of the
proceeds of each Loan requested therein, and each submission by the Borrower to
an Issuer of a Letter of Credit Request and the Issuance of each Letter of
Credit requested therein, shall be deemed to constitute a representation and
warranty by the Borrower as to the matters specified in Section 3.2(b) on the
date of the making of such Loan or the Issuance of such Letter of Credit.
SECTION 3.3 DETERMINATIONS OF INITIAL BORROWING CONDITIONS.
For purposes of determining compliance with the conditions
specified in Section 3.1, each Lender shall be deemed to have consented to,
approved, accepted or be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to
the Lenders unless an officer of the Administrative Agent responsible for the
transactions contemplated by the Loan Documents shall have received notice from
such Lender prior to the initial Borrowing or Issuance hereunder specifying its
objection thereto and such Lender shall not have made available to the
Administrative Agent such Lender's Ratable Portion of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce the Lenders, the Issuers and the Administrative
Agent to enter into this Agreement, the Borrower represents and warrants to the
Lenders, the Issuers and the Administrative Agent, on and as of the Effective
Date, the making of the Loans and the other financial accommodations (including
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the Issuance of Letters of Credit) on the Effective Date and on and as of each
date as required by Section 3.2(b)(i):
SECTION 4.1 CORPORATE EXISTENCE; COMPLIANCE WITH LAW.
Each of the Borrower and its Restricted Subsidiaries (a) is
duly organized or incorporated, validly existing and in good standing under the
laws of the jurisdiction of its organization; (b) is duly qualified to do
business as a foreign corporation or entity and in good standing under the laws
of each jurisdiction where such qualification is necessary, except where the
failure to be so qualified or in good standing would not have a Material Adverse
Effect; (c) has all requisite power and authority and the legal right to own,
pledge, mortgage and operate its properties, to lease the property it operates
under lease and to conduct its business as now or currently proposed to be
conducted; (d) is in compliance with its Constituent Documents; (e) is in
compliance with all applicable Requirements of Law except where the failure to
be in compliance would not in the aggregate have a Material Adverse Effect; and
(f) has all necessary licenses, permits, consents or approvals from or by, has
made all necessary filings with, and has given all necessary notices to, each
Governmental Authority having jurisdiction, to the extent required for such
ownership, operation and conduct, except for licenses, permits, consents,
approvals or filings that can be obtained or made by the taking of ministerial
action to secure the grant or transfer thereof or the failure to obtain or make
would not, in the aggregate, have a Material Adverse Effect.
SECTION 4.2 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE
OBLIGATIONS.
(a) The execution, delivery and performance by each Loan Party
of the Loan Documents to which it is a party and the consummation of the
transactions contemplated thereby:
(i) are within such Loan Party's corporate, limited liability
company, partnership or other powers;
(ii) have been or, at the time of delivery thereof pursuant to
Article III will have been duly authorized by all necessary corporate
or other entity action, including the consent of shareholders, partners
and members where required;
(iii) do not and will not (A) contravene any Loan Party's or
any of its Subsidiaries' respective Constituent Documents, (B) violate
any other Requirement of Law applicable to any Loan Party (including
Regulations T, U and X of the Federal Reserve Board), or any order or
decree of any Governmental Authority or arbitrator applicable to any
Loan Party, (C) conflict with or result in the breach of, or constitute
a default under, or result in or permit the termination or acceleration
of, any Contractual Obligation of any Loan Party, or (D) result in the
creation or imposition of any Lien upon any of the property of any Loan
Party; and
(iv) do not require the consent of, authorization by, approval
of, notice to, or filing or registration with, any Governmental
Authority or any other Person, other than those listed on SCHEDULE 4.2
and which have been or will be, prior to the Effective Date, obtained
or made, copies of which have been or will be delivered to the
Administrative Agent pursuant to Section 3.1, and each of which on the
Effective Date will be in full force and effect.
(b) This Agreement has been, and each of the other Loan
Documents will have been upon delivery thereof pursuant to the terms of this
Agreement, duly executed and delivered by each Loan Party thereto. This
Agreement is, and the other Loan Documents will be, when delivered hereunder,
the legal, valid and binding obligation of each Loan Party thereto, enforceable
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against such Loan Party in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally.
SECTION 4.3 OWNERSHIP OF BORROWER; SUBSIDIARIES.
(a) The Disclosure Documents set forth the authorized and
issued and outstanding capital stock of the Borrower, and the ownership thereof
by TOSA. Except as set forth on SCHEDULE 4.3, no Stock of the Borrower is
subject to any option, warrant, right of conversion or purchase or any similar
right. There are no agreements or understandings to which the Borrower is a
party with respect to the voting, sale or transfer of any shares of Stock of the
Borrower or any agreement restricting the transfer or hypothecation of any such
shares, other than those set forth on SCHEDULE 4.3.
(b) Set forth on SCHEDULE 4.3 is a complete and accurate list
showing, as of the Effective Date, all Restricted Subsidiaries of the Borrower
and, as to each such Subsidiary, the jurisdiction of its organization, the
number of shares of each class of Stock authorized (if applicable), the number
outstanding on the Effective Date and the number and percentage of the
outstanding shares of each such class owned (directly or indirectly) by the
Borrower. Except as set forth on SCHEDULE 4.3, no Stock of any Restricted
Subsidiary of the Borrower is subject to any outstanding option, warrant, right
of conversion or purchase or any similar right. All of the outstanding Stock of
each Restricted Subsidiary of the Borrower owned (directly or indirectly) by the
Borrower has been validly issued, is fully paid and non-assessable (to the
extent applicable) and, as of the Effective Date, is owned by the Borrower or a
Restricted Subsidiary of the Borrower, free and clear of all Liens. Neither the
Borrower nor any such Restricted Subsidiary is a party to, or has knowledge of,
any agreement restricting the transfer or hypothecation of any Stock of any such
Restricted Subsidiary, other than (i) the Loan Documents and (ii) such customary
restrictions related to the interest of the Borrower and its Restricted
Subsidiaries in limited liability companies or partnerships. The Borrower does
not own or hold, directly or indirectly, any Stock of any Person other than such
Subsidiaries and Investments permitted by Section 7.2, which Investments are set
forth on SCHEDULE 4.3.
SECTION 4.4 FINANCIAL STATEMENTS.
(a) The Consolidated balance sheets of the Borrower and its
Subsidiaries as at December 31, 2003 and as at June 30, 2004, and the related
Consolidated statements of income, retained earnings and cash flows of the
Borrower and its Subsidiaries for the fiscal year or fiscal quarter, as the case
may be, then ended, (and the December 31, 2003 financial statements certified by
Ernst & Young LLP), copies of which have been furnished to each Lender, fairly
present the Consolidated financial condition of the Borrower and its
Subsidiaries as at such date and the Consolidated results of the operations of
the Borrower and its Subsidiaries for the period ended on such date, all in
conformity with GAAP (subject, in the case of the financial statements as of and
for the period ended June 30, 2004, to normal year-end adjustments and to the
absence of notes).
(b) Except as set forth on SCHEDULE 4.4, neither the Borrower
nor any of its Restricted Subsidiaries has any material obligation, material
contingent liability or material liability for taxes, material long-term leases
or unusual forward or long-term material commitment that is not reflected in the
Financial Statements referred to in CLAUSE (A) above or in the notes thereto and
not otherwise permitted by this Agreement.
(c) The One Year Projections were prepared by the Borrower in
light of the past operations of its business, and reflect projections for the
three year period beginning on January 1, 2003 on a quarterly basis. The One
Year Projections are based upon estimates and assumptions stated therein, that
the Borrower believes in each case to be reasonable and fair in light of current
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conditions and current facts known to the Borrower and, as of the Effective
Date, reflect the Borrower's good faith and reasonable estimates of the future
financial performance of the Borrower and its Restricted Subsidiaries and of the
other information projected therein for the periods set forth therein.
SECTION 4.5 MATERIAL ADVERSE CHANGE.
There has been no Material Adverse Change and there have been
no events or developments that in the aggregate have had a Material Adverse
Effect since December 31, 2003.
SECTION 4.6 LITIGATION.
Except as set forth on SCHEDULE 4.6, there are no pending or,
to the knowledge of the Borrower, threatened actions, investigations or
proceedings affecting the Borrower, or any of its Restricted Subsidiaries before
any court, Governmental Authority or arbitrator other than those that in the
aggregate are not reasonably likely to be determined adversely to any Loan Party
and, if so determined, would not have a Material Adverse Effect. The performance
of any action by any Loan Party required or contemplated by any Loan Documents
is not restrained or enjoined (either temporarily, preliminarily or
permanently).
SECTION 4.7 TAXES.
(a) All federal, state, local and foreign income and franchise
and other material tax returns, reports and statements (collectively, the "TAX
RETURNS") required to be filed by the Borrower or any of its Tax Affiliates have
been filed with the appropriate Governmental Authorities in all jurisdictions in
which such Tax Returns are required to be filed, all such Tax Returns are true
and correct in all material respects, and all taxes, charges and other
impositions reflected therein have been paid prior to the date on which any
fine, penalty, interest, late charge or loss may be added thereto for
non-payment thereof except where contested in good faith and by appropriate
proceedings if adequate reserves therefor have been established on the books of
the Borrower or such Tax Affiliate in conformity with GAAP. Except as set forth
on SCHEDULE 4.7, no Tax Return is under audit or examination by any Governmental
Authority and no notice of such an audit or examination or any assertion of any
claim for Taxes has been given or made by any Governmental Authority. Proper and
accurate amounts have been withheld by the Borrower and each of its Tax
Affiliates from their respective employees for all periods in full and complete
compliance with the tax, social security and unemployment withholding provisions
of applicable Requirements of Law and such withholdings have been timely paid to
the respective Governmental Authorities.
(b) Except as set forth on SCHEDULE 4.7, none of the Borrower
or any of its Tax Affiliates has (i) executed or filed with the IRS or any other
Governmental Authority any agreement or other document extending, or having the
effect of extending, the period for the filing of any Tax Return or the
assessment or collection of any charges, (ii) incurred any obligation under any
tax sharing agreement or arrangement other than those of which the
Administrative Agent has received a copy prior to the date hereof, or (iii) been
a member of an affiliated, combined or unitary group other than the group of
which the Borrower (or its Tax Affiliate) is the common parent.
SECTION 4.8 FULL DISCLOSURE.
(a) The information prepared or furnished by or on behalf of
the Borrower or any Loan Party in connection with this Agreement, the other Loan
Documents or the consummation of the transactions contemplated hereby or thereby
including the information contained in the Disclosure Documents, does not
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements contained therein or herein not misleading.
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(b) The Borrower has delivered to the Administrative Agent a
true, complete and correct copy of the Disclosure Documents. The Disclosure
Documents comply as to form in all material respects with all applicable
requirements of all applicable state and Federal securities laws.
SECTION 4.9 MARGIN REGULATIONS.
The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying margin stock (within the
meaning of Regulation U of the Federal Reserve Board), and no proceeds of any
Loan or Letter of Credit will be used to purchase or carry any such margin stock
or to extend credit to others for the purpose of purchasing or carrying any such
margin stock in contravention of Regulation T, U or X of the Federal Reserve
Board.
SECTION 4.10 NO BURDENSOME RESTRICTIONS; NO DEFAULTS.
(a) Neither the Borrower nor any of its Restricted
Subsidiaries (i) is a party to any Contractual Obligation the performance of
which by any thereof, either unconditionally or upon the happening of an event,
would result in the creation of a Lien (other than a Lien permitted under
Section 7.1) on the property or assets of any thereof or (ii) is subject to any
charter or corporate restrictions that would, in the aggregate, have a Material
Adverse Effect.
(b) There is no default or event of default outstanding under
the Existing Credit Agreement. Neither the Borrower nor any of its Restricted
Subsidiaries is in default under or with respect to any Contractual Obligation
owed by it and, to the knowledge of the Borrower, no other party is in default
under or with respect to any Contractual Obligation owed to any Loan Party,
other than, in either case, those defaults that in the aggregate would not have
a Material Adverse Effect.
(c) To the best knowledge of the Borrower, there are no
Requirements of Law applicable to any Loan Party the compliance with which by
such Loan Party would, in the aggregate, have a Material Adverse Effect.
SECTION 4.11 INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING
COMPANY ACT.
Neither the Borrower nor any of its Restricted Subsidiaries is
(a) an "INVESTMENT COMPANY" or an "AFFILIATED PERSON" of, or "PROMOTER" or
"PRINCIPAL UNDERWRITER" for, an "INVESTMENT COMPANY," as such terms are defined
in the Investment Company Act of 1940, as amended or (b) a "HOLDING COMPANY," or
an "AFFILIATE" of a "HOLDING COMPANY" or a "SUBSIDIARY COMPANY" of a "HOLDING
COMPANY," as each such term is defined and used in the Public Utility Holding
Company Act of 1935, as amended.
SECTION 4.12 USE OF PROCEEDS.
The proceeds of the Loans and the Letters of Credit have been
or are being used by the Borrower solely (a) to repay amounts due and owing
under the Existing Credit Agreement on the Effective Date and to pay transaction
costs, fees and expenses related thereto and to this Agreement and (b) on and
after the Effective Date, for working capital from time to time and for other
general corporate purposes.
SECTION 4.13 INSURANCE.
Except as set forth on SCHEDULE 4.13, all policies of
insurance of any kind or nature of the Borrower or any of its Restricted
Subsidiaries, including policies of life, fire, theft, product liability, public
liability, property damage, other casualty, employee fidelity, workers'
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compensation and employee health and welfare insurance, are in full force and
effect and are of a nature and provide such coverage as is customarily carried
by, and to the best knowledge and belief of the Borrower is sufficient for,
businesses of the size and character of such Person. Except as set forth on
SCHEDULE 4.13, none of the Borrower or any of its Restricted Subsidiaries has in
the three years preceding the Effective Date been refused insurance for any
material coverage for which it had applied or had any policy of insurance
terminated (other than at its request).
SECTION 4.14 LABOR MATTERS.
(a) There are no strikes, work stoppages, slowdowns or
lockouts pending or threatened against or involving the Borrower or any of its
Subsidiaries, other than those that in the aggregate would not have a Material
Adverse Effect.
(b) There are no unfair labor practices, grievances or
complaints pending, or, to the Borrower's knowledge, threatened, against or
involving the Borrower or any of its Restricted Subsidiaries, nor are there any
pending or, to the Borrower's knowledge, threatened arbitrations or grievances
involving the Borrower or any of its Restricted Subsidiaries, other than those
that, in the aggregate, if resolved adversely to the Borrower or such Restricted
Subsidiary, would not have a Material Adverse Effect.
SECTION 4.15 ERISA.
Each Title IV Plan is in compliance in all material respects
with applicable provisions of ERISA, the Code and other Requirements of Law
except for non-compliances that in the aggregate would not have a Material
Adverse Effect. There has been no, nor is there reasonably expected to occur,
any ERISA Event other than those that, in the aggregate, would not have a
Material Adverse Effect. Neither the Borrower nor any ERISA Affiliate has
contributed or been obligated to contribute to, any Multiemployer Plan within
the last six years.
SECTION 4.16 ENVIRONMENTAL MATTERS.
(a) The operations of the Borrower and each of its
Subsidiaries have been and are in compliance with all Environmental Laws, other
than non-compliances that individually or in the aggregate are not reasonably
likely to result in a Material Adverse Effect.
(b) There are no facts, circumstances or conditions arising
out of or relating to the operations of the Borrower or any it its Subsidiaries
or ownership of Real Property owned, operated or leased by the Borrower or any
of its Subsidiaries which are not specifically included in the financial
information furnished to the Lenders other than those that individually or in
the aggregate are not reasonably likely to result in a Material Adverse Effect.
SECTION 4.17 INTELLECTUAL PROPERTY.
The Borrower and its Restricted Subsidiaries own or license or
otherwise have the right to use all licenses, permits, patents, patent
applications, trademarks, trademark applications, service marks, trade names,
copyrights, copyright applications, franchises, authorizations and other
intellectual property rights that are material for the operations of their
respective businesses, without infringement upon or conflict with the rights of
any other Person with respect thereto, including all trade names associated with
any private label brands of the Borrower or any of its Restricted Subsidiaries.
To the Borrower's knowledge, no slogan or other advertising device, product,
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process, method, substance, part or component, or other material now employed,
or now contemplated to be employed, by the Borrower or any of its Restricted
Subsidiaries infringes upon or conflicts with any rights owned by any other
Person, and no action, proceeding, claim or litigation regarding any of the
foregoing is pending or threatened.
SECTION 4.18 TITLE; REAL PROPERTY.
(a) Each of the Borrower and its Restricted Subsidiaries has
good and marketable or indefeasible title to, or valid leasehold interests in,
all Real Property and good title to all material personal property in each case
that is purported to be owned or leased by it, including those reflected on the
most recent Financial Statements delivered by the Borrower, and none of such
properties and assets is subject to any Lien, except Liens permitted under
Section 7.1.
(b) All Permits required to have been issued or appropriate to
enable all Real Property of the Borrower or any of its Restricted Subsidiaries
to be lawfully occupied and used for all of the purposes for which they are
currently occupied and used have been lawfully issued and are in full force and
effect, other than those that, in the aggregate, would not have a Material
Adverse Effect.
(c) None of the Borrower or any of its Restricted Subsidiaries
has received any notice, or has any knowledge, of any pending, threatened or
contemplated condemnation proceeding affecting any Real Property of the Borrower
or any of its Subsidiaries or any part thereof, except those that, in the
aggregate, would not have a Material Adverse Effect.
SECTION 4.19 ANTI-TERRORISM LAWS.
(a) Neither the Borrower nor, to the knowledge of any of the
Loan Parties, any of its Affiliates is in violation of any laws relating to
terrorism or money laundering ("ANTI-TERRORISM LAWS"), including Executive Order
No. 13224 on Terrorist Financing, effective September 23, 2001 (the "EXECUTIVE
ORDER"), and the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law
107-56 (signed into law on October 26, 2001) (the "USA PATRIOT ACT").
(b) Neither the Borrower nor, to the knowledge of any of Loan
Parties, any of its Affiliates acting or benefiting in any capacity in
connection with the Loans is any of the following:
(i) a Person or entity that is listed in the annex to, or is
otherwise subject to the provisions of, the Executive Order;
(ii) a Person or entity owned or controlled by, or acting for
or on behalf of, any Person or entity that is listed in the annex to,
or is otherwise subject to the provisions of, the Executive Order;
(iii) a Person or entity with which any Lender is prohibited
from dealing or otherwise engaging in any transaction by any
Anti-Terrorism Law;
(iv) a Person or entity that commits, threatens or conspires
to commit or supports "terrorism" as defined in the Executive Order; or
(v) a Person or entity that is named as a "specially
designated national and blocked person" on the most current list
published by the U.S. Treasury Department Office of Foreign Assets
Control at its official website or any replacement website or other
replacement official publication of such list.
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(c) Neither the Borrower nor, to the knowledge of any Loan
Party, any of its Affiliates acting in any capacity in connection with the Loans
(i) conducts any business or engages in making or receiving any contribution of
funds, goods or services to or for the benefit of any Person described in CLAUSE
(B) above, (ii) deals in, or otherwise engages in any transaction relating to,
any property or interests in property blocked pursuant to the Executive Order,
or (iii) engages in or conspires to engage in any transaction that evades or
avoids, or has the purpose of evading or avoiding, or attempts to violate, any
of the prohibitions set forth in any Anti-Terrorism Law.
ARTICLE V
FINANCIAL COVENANTS
As long as any of the Obligations or the Revolving Credit
Commitments remain outstanding, unless the Requisite Lenders otherwise consent
in writing, the Borrower agrees with the Lenders and the Administrative Agent
that:
SECTION 5.1 ADJUSTED CONSOLIDATED TANGIBLE NET WORTH.
The Borrower shall maintain Adjusted Consolidated Tangible Net
Worth measured as of the last day of each fiscal quarter ending after the
Effective Date of (a) $350,000,000 PLUS (b) in the case of each fiscal quarter
ending after the Effective Date, 50% of the Consolidated Net Income of the
Borrower for each full fiscal quarter starting after the Effective Date PLUS (c)
50% of the aggregate increase in shareholders' equity of the Borrower after the
date hereof by reason of an Equity Issuance (including upon conversion of
Indebtedness into such capital stock but excluding (i) stock issued in
connection with an employee stock ownership plan, an employee stock option plan,
an employee stock purchase plan, and (ii) any portion of such increase in
shareholders' equity attributable to goodwill recognized in connection with a
Permitted Acquisition).
SECTION 5.2 MAXIMUM INDEBTEDNESS TO ADJUSTED CONSOLIDATED
TANGIBLE NET WORTH RATIO.
The Borrower shall maintain Indebtedness to Adjusted
Consolidated Tangible Net Worth Ratio measured as of the last day of each fiscal
quarter ending after the Effective Date of not more than (a) 2.50 to 1, if at
such time the Interest Coverage Ratio, determined as of such last day, for the
four fiscal quarter period ending on such last day is greater than or equal to
2.50 to 1, and (b) 2.25 to 1 if at such time the Interest Coverage Ratio,
determined as of such last day, for the four fiscal quarter period ending on
such last day, is less than 2.50 to 1.
SECTION 5.3 MINIMUM INTEREST COVERAGE RATIO.
The Borrower shall maintain a Interest Coverage Ratio,
measured as of the last day of each fiscal quarter ending after the Effective
Date, for the four fiscal quarter period ending on such day, of greater than or
equal to 2.00 to 1.
SECTION 5.4 UNSOLD LAND TO ADJUSTED CONSOLIDATED TANGIBLE NET
WORTH.
The Borrower shall maintain a ratio measured as of the last
day of each fiscal quarter ending after the Effective Date of (a) Unsold Land of
the Borrower and its Restricted Subsidiaries, the value of which is determined
in conformity with GAAP, to (b) Adjusted Consolidated Tangible Net Worth of not
more than 1.50 to 1.
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SECTION 5.5 UNSOLD UNITS TO UNITS CLOSED.
The Borrower shall maintain a ratio measured as of the last
day of each fiscal quarter ending after the Effective Date of (a) the aggregate
number of Units owned by the Borrower and its Restricted Subsidiaries that
constitute Unsold Units to (b) Units Closed by the Borrower and its Restricted
Subsidiaries, determined as of the last day of each calendar month, for the
twelve months ending on such day, of not more than 1 to 4. For the avoidance of
doubt, for any period, the calculation of the ratio of Unsold Units to Units
Closed shall give pro forma effect to the Unsold Units and Units Closed acquired
by Borrower or its Restricted Subsidiaries in connection with a Permitted
Acquisition consummated during such period.
ARTICLE VI
AFFIRMATIVE COVENANTS
As long as the Obligations or the Revolving Credit Commitments
remain outstanding, unless the Requisite Lenders otherwise consent in writing,
the Borrower agrees with the Lenders and the Administrative Agent that:
SECTION 6.1 REPORTING REQUIREMENTS.
The Borrower shall furnish to the Administrative Agent each of
the following:
(a) QUARTERLY REPORTS.
Within 45 days after the end of each fiscal quarter (other
than fiscal quarters ending December 31), financial information regarding the
Borrower and its Subsidiaries consisting of Consolidated and consolidating
unaudited balance sheets as of the close of such quarter and the related
statements of income and cash flow for such quarter and that portion of the
fiscal year ending as of the close of such quarter, setting forth in comparative
form the figures for the corresponding period in the prior year and the figures
contained in the Projections, or, if applicable the latest business plan
provided pursuant to CLAUSE (D) below, for the current fiscal year, in each case
certified by the Chief Financial Officer of the Borrower as fairly presenting
the Consolidated and consolidating financial position of the Borrower and its
Subsidiaries as at the dates indicated and the results of their operations and
cash flow for the periods indicated in conformity with GAAP (subject to the
absence of footnote disclosure and normal year-end audit adjustments). To the
extent the information set forth in this CLAUSE (A) of Section 6.1 are included
in the Borrower's Quarterly Report on Form 10-Q as filed with the Securities and
Exchange Commission, such information shall be deemed delivered for the purposes
hereof.
(b) ANNUAL REPORTS.
Within 90 days after the end of each fiscal year, financial
information regarding the Borrower and its Subsidiaries consisting of
Consolidated and consolidating balance sheets of the Borrower and its
Subsidiaries as of the end of such year and related statements of income and
cash flows of the Borrower and its Subsidiaries for such fiscal year, all
prepared in conformity with GAAP and certified, in the case of such Consolidated
Financial Statements, without qualification as to the scope of the audit or as
to the Borrower being a going concern by Ernst & Young LLP or other independent
certified public accountants acceptable to the Administrative Agent, together
with the report of such accounting firm stating that (i) such Financial
Statements fairly present the Consolidated financial position of the Borrower
and its Subsidiaries as at the dates indicated and the results of their
operations and cash flow for the periods indicated in conformity with GAAP
applied on a basis consistent with prior years (except for changes with which
such independent certified public accountants shall concur and which shall have
been disclosed in the notes to the Financial Statements) and (ii) the
examination by such accountants in connection with such Consolidated Financial
Statements has been made in accordance with generally accepted auditing
standards, and accompanied by a certificate stating that in the course of the
regular audit of the business of the Borrower and its Subsidiaries such
accounting firm has obtained no knowledge that a Default or Event of Default in
respect of the financial covenant contained in Section 5.2 has occurred and is
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continuing or, if in the opinion of such accounting firm, a Default or Event of
Default has occurred and is continuing in respect of such financial covenant, a
statement as to the nature thereof. To the extent the information set forth in
this CLAUSE (B) of Section 6.1 are included in the Borrower's Annual Report on
Form 10-K as filed with the Securities and Exchange Commission, such information
shall be deemed delivered for the purposes hereof.
(c) COMPLIANCE CERTIFICATE. Together with each delivery of any
report pursuant to CLAUSES (A) and (B) of this Section 6.1,
(i) a certificate of a Responsible Officer of the Borrower
(each, a "COMPLIANCE CERTIFICATE") (A) showing in reasonable detail the
calculations used in determining the Indebtedness to Adjusted
Consolidated Tangible Net Worth Ratio (for purposes of determining the
Applicable Margin and the Applicable Unused Commitment Fee Rate) and
demonstrating compliance with each of the financial covenants contained
in Article V as of the end of such quarter, (B) showing such
information and calculations reasonably requested by the Administrative
Agent relating to Indebtedness Associated with Assets Not Owned of the
Borrower and its Restricted Subsidiaries or with respect to which the
Borrower or any of its Restricted Subsidiaries has options (or similar
rights) to purchase land and (C) stating that no Default or Event of
Default has occurred and is continuing or, if a Default or an Event of
Default has occurred and is continuing, stating the nature thereof and
the action that the Borrower proposes to take with respect thereto; and
(ii) summary Consolidated and consolidating financial
statements for each of (A) the Unrestricted Subsidiaries as a group and
(B) the Borrower and the Restricted Subsidiaries as a group.
(d) PROJECTIONS/BUSINESS PLAN.
Not later than the end of each fiscal year, and containing
substantially the types of financial information contained in the One Year
Projections, the annual business and financial plans of the Borrower for the
next succeeding fiscal year.
(e) DEFAULT NOTICES.
As soon as practicable, and in any event within five Business
Days after a Responsible Officer of any Loan Party has actual knowledge of the
existence of any Default, Event of Default or other event having had a Material
Adverse Effect, the Borrower shall give the Administrative Agent notice
specifying the nature of such Default or Event of Default or other event,
including the anticipated effect thereof, which notice, if given by telephone,
shall be promptly confirmed in writing on the next Business Day.
(f) NOTICE OF LITIGATION.
Promptly after the commencement thereof, the Borrower shall
give the Administrative Agent written notice of the commencement of all actions,
suits and proceedings before any domestic or foreign Governmental Authority or
arbitrator, affecting the Borrower or any of its Restricted Subsidiaries, that,
in the reasonable judgment of the Borrower, expose the Borrower or such
Restricted Subsidiary to liability which, if adversely determined could
reasonably be expected to have a Material Adverse Effect.
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(g) ERISA MATTERS.
The Borrower shall furnish the Administrative Agent the
following:
(a) promptly and in any event within 10 days after the
Borrower, any of its Subsidiaries or any ERISA Affiliate knows or has
reason to know that any ERISA Event reasonably likely to result in a
liability of the Borrower or its Subsidiaries in excess of $1,000,000
has occurred, a written statement of a Responsible Officer of the
Borrower describing such ERISA Event and the action, if any, that the
Borrower, its Subsidiaries and ERISA Affiliates propose to take with
respect thereto and a copy of any notice filed by the Borrower, any of
its Subsidiaries or any ERISA Affiliate with the PBGC or the IRS
pertaining thereto; and
(b) promptly following any request therefor, copies of (i)
each SCHEDULE B (Actuarial Information) to the annual report (Form 5500
Series) filed by the Borrower or any ERISA Affiliate with the Internal
Revenue Service with respect to each Title IV Plan; (ii) the most
recent actuarial valuation report for each Title IV Plan; (iii) all
notices received by the Borrower or any ERISA Affiliate from a
Multiemployer Plan sponsor or any governmental agency concerning an
ERISA Event; and (iv) such other documents or governmental reports or
filings relating to any Title IV Plan (or employee benefit plan
sponsored or contributed to by any Company) as the Administrative Agent
shall reasonably request.
(h) ENVIRONMENTAL MATTERS.
The Borrower shall provide to the Administrative Agent
promptly and in any event within 10 days after receipt by Borrower or any
Restricted Subsidiary, a copy of (i) any written notice or claim to the effect
that the Borrower or any Subsidiary is or may be liable to any Person as a
result of a Release or threatened Release or any toxic or hazardous waste or
substance into the environment and (ii) any notice alleging any violation of any
Environmental Law by Borrower or any Restricted Subsidiary which, in the case of
either (i) or (ii), could reasonably be expected to have a Material Adverse
Effect.
(i) BORROWING BASE DETERMINATION.
(i) No later than 30 days after the last day of each calendar
month or more frequently as requested by the Administrative Agent, the
Borrower shall provide a Borrowing Base Certificate as of the first day
of such month executed by a Responsible Officer of the Borrower. The
Borrower agrees that each Borrowing Base Certificate delivered by the
Borrower shall be accompanied by appropriate supporting data and shall
not be deemed delivered until verified by the Administrative Agent to
the Administrative Agent's satisfaction. Upon verification by the
Administrative Agent, each Borrowing Base Certificate shall be deemed
delivered for purposes of determining the Borrowing Base as of the date
of its actual delivery. The Borrower agrees that the Administrative
Agent in the process of its verification may determine, in its
reasonable discretion, the particular category to which any Borrowing
Base Asset belongs.
(ii) The Administrative Agent may (prior to the occurrence of
an Event of Default, at its sole cost and expense and with 14 days
prior written notice to the Borrower, and, after and during the
continuance of an Event of Default, at the Borrower's sole cost and
expense) make physical verifications of the Borrowing Base Assets in
any manner and through any medium that the Administrative Agent
considers advisable, and the Borrower shall furnish all such assistance
and information as the Administrative Agent may require in connection
therewith.
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(j) OTHER INFORMATION.
The Borrower will provide the Administrative Agent or any
Lender with such other information respecting the business, properties,
condition, financial or otherwise, or operations of the Borrower or any of its
Restricted Subsidiaries as the Administrative Agent or any Lender through the
Administrative Agent may from time to time reasonably request.
SECTION 6.2 PRESERVATION OF CORPORATE EXISTENCE, ETC.
The Borrower shall, and shall cause each of its Restricted
Subsidiaries to, preserve and maintain its legal existence, rights (charter and
statutory) and franchises, except as permitted by Section 7.2 and Section 7.4.
SECTION 6.3 COMPLIANCE WITH LAWS, ETC.
The Borrower shall, and shall cause each of its Restricted
Subsidiaries to, comply with all applicable Requirements of Law, Contractual
Obligations and Permits, except where the failure so to comply would not in the
aggregate have a Material Adverse Effect.
SECTION 6.4 CONDUCT OF BUSINESS.
The Borrower shall, and shall cause each of its Restricted
Subsidiaries to, (a) conduct its business in the ordinary course and (b) use its
reasonable efforts, in the ordinary course and consistent with past practice, to
preserve its business and the goodwill and business of the customers,
advertisers, suppliers and others having business relations with the Borrower or
any of its Restricted Subsidiaries, except where the failure to comply with the
covenants in each of CLAUSES (A) and (B) above would not in the aggregate have a
Material Adverse Effect.
SECTION 6.5 PAYMENT OF TAXES, ETC.
The Borrower shall, and shall cause each of its Subsidiaries
to, pay and discharge before the same shall become delinquent, all lawful
material governmental claims, taxes, assessments, charges and levies, except
where contested in good faith, by proper proceedings and adequate reserves
therefor have been established on the books of the Borrower or the appropriate
Subsidiary in conformity with GAAP.
SECTION 6.6 MAINTENANCE OF INSURANCE.
The Borrower shall maintain for, and cause to be maintained
by, each of its Restricted Subsidiaries insurance with responsible and reputable
insurance companies or associations in such amounts and covering such risks as
is usually carried by companies engaged in similar businesses and owning similar
properties in the same general areas in which the Borrower or such Restricted
Subsidiary operates, and such other insurance as may be reasonably requested by
the Requisite Lenders.
SECTION 6.7 TRANSACTIONS WITH AFFILIATES.
The Borrower shall conduct, and cause each of its Subsidiaries
to conduct, all transactions otherwise not prohibited under this Agreement with
any of their Affiliates (including payment of management fees) on terms that are
fair and reasonable and no less favorable to the Borrower or such Subsidiary
than it would obtain in an arm's-length transaction with a Person not an
Affiliate thereof; PROVIDED, HOWEVER, that (a) the Borrower may make payments to
▇▇▇▇ of up to $3,500,000 in any fiscal year under the Management Services
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Agreement (or another similar agreement) and (b) the Borrower may perform its
obligations under the Tax Allocation Agreement.
SECTION 6.8 ACCESS.
The Borrower shall from time to time permit the Administrative
Agent and the Lenders, or any agents or representatives thereof, promptly after
written notification of the same (except that during the continuance of an Event
of Default, no such notice shall be required) to (a) examine and make copies of
and abstracts from the records and books of account of the Borrower and each of
its Subsidiaries, (b) visit the properties of the Borrower and each of its
Subsidiaries, (c) discuss the affairs, finances and accounts of the Borrower and
each of its Subsidiaries with any of their respective officers or directors and
(d) communicate directly with any of the Borrower's certified public
accountants. The Borrower shall authorize its independent certified public
accountants to disclose to the Administrative Agent or any Lender during the
continuance of an Event of Default of the type described in Section 9.1(a) or
(b) any and all Financial Statements and other information of any kind, as the
Administrative Agent or any Lender reasonably requests from the Borrower and
that such accountants may have with respect to the business, financial
condition, results of operations or other affairs of the Borrower or any of its
Subsidiaries.
SECTION 6.9 KEEPING OF BOOKS.
The Borrower shall, and shall cause each of its Subsidiaries
to keep, proper books of record and account, in which full and correct entries
shall be made in conformity with GAAP (to the extent GAAP is applicable thereto)
of all financial transactions and the assets and business of the Borrower and
each such Subsidiary.
SECTION 6.10 MAINTENANCE OF PROPERTIES, ETC.
The Borrower shall, and shall cause each of its Restricted
Subsidiaries to, maintain and preserve, (a) all of its properties (tangible and
intangible) which are necessary in the conduct of its business in good working
order and condition, subject to ordinary wear and tear, (b) all rights, permits,
licenses, approvals and privileges (including all Permits) used or useful or
necessary in the conduct of its business and (c) all registered patents,
trademarks, trade names, copyrights, service marks and other intellectual
property with respect to its business; except where the failure to so maintain
and preserve would not in the aggregate have a Material Adverse Effect.
SECTION 6.11 APPLICATION OF PROCEEDS.
The Borrower shall use the entire amount of the proceeds of
the Loans and Letters of Credit as provided in Section 4.12.
SECTION 6.12 ENVIRONMENTAL.
The Borrower shall, and shall cause each of its Restricted
Subsidiaries to comply in all material respects with Environmental Laws and,
without limiting the foregoing, the Borrower shall, at its sole cost and
expense, upon receipt of any notification or otherwise obtaining knowledge of
any Release or other event that individually or in the aggregate could
reasonably be expected to have a Material Adverse Effect, (a) conduct or pay for
consultants to conduct, tests or assessments of environmental conditions at such
operations or properties, including the investigation and testing of subsurface
conditions and (b) take such Remedial Action, and undertake such investigation
or other action as required by Environmental Laws or as any Governmental
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Authority requires or as is appropriate and consistent with good business
practice to address the Release or event and otherwise ensure compliance with
Environmental Laws.
SECTION 6.13 ADDITIONAL GUARANTIES.
To the extent not delivered to the Administrative Agent on or
before the Effective Date, the Borrower promptly shall, and shall cause each of
its Restricted Subsidiaries promptly to, in the case of any Restricted
Subsidiary that is a Domestic Subsidiary owning 5% or more of the Total Assets
of the Borrower and its Restricted Subsidiaries or contributing 5% or more of
the Consolidated Net Income of the Borrower and its Restricted Subsidiaries for
the immediately preceding four fiscal quarters, cause such Restricted Subsidiary
to become a party to the Guaranty. Notwithstanding anything herein to the
contrary, in the event that at any time the Subsidiaries of the Borrower (other
than those Subsidiaries engaged in the business of originating residential home
loans, title insurance and reinsurance) that are not Guarantors own, in the
aggregate for all such Subsidiaries, 5% or more of the Total Assets of the
Borrower and its Restricted Subsidiaries or contribute 5% or more of the
Consolidated Net Income of the Borrower and its Restricted Subsidiaries for the
immediately preceding four fiscal quarters, the Borrower shall promptly cause
such number of its Subsidiaries to become a party to the Guaranty so that the
Subsidiaries of the Borrower that are not Guarantors do not own, in the
aggregate for all such Subsidiaries, 5% or more of the Total Assets of the
Borrower and its Restricted Subsidiaries or contribute 5% or more of the
Consolidated Net Income of the Borrower and its Restricted Subsidiaries for the
immediately preceding four fiscal quarters. In the event that any Subsidiary of
the Borrower incurs, or has outstanding (including, without limitation, the
Senior Notes or the Senior Subordinated Notes) any guaranty obligation in
respect of other Indebtedness of the Borrower or any Restricted Subsidiary, the
Borrower or any Guarantor shall promptly cause such Subsidiary to become a party
to the Guaranty.
SECTION 6.14 DESIGNATION OF RESTRICTED AND UNRESTRICTED
SUBSIDIARIES.
The Board of Directors may designate any Subsidiary of the
Borrower to be an Unrestricted Subsidiary if the Subsidiary to be so designated:
(a) does not own any Stock or Indebtedness of, or own or hold
any Lien on any property of, the Borrower or any other Restricted
Subsidiary or is not otherwise required by the terms of this Agreement
to be either a Restricted Subsidiary or a Guarantor;
(b) has no Indebtedness other than Indebtedness:
(1) as to which neither the Borrower nor any of its
Restricted Subsidiaries (A) provides credit support of any
kind (including any undertaking, agreement or instrument that
would constitute Indebtedness), (B) is directly or indirectly
liable as a Guarantor or otherwise, or (C) constitutes the
lender; PROVIDED, HOWEVER, the Borrower or a Restricted
Subsidiary may loan, advance or extend credit to, or Guaranty
the Indebtedness of, an Unrestricted Subsidiary at any time
following the date such Subsidiary is designated as an
Unrestricted Subsidiary in accordance with this Section 6.14;
and
(2) no default with respect to which (including any
rights that the holders thereof may have to take enforcement
action against an Unrestricted Subsidiary) would permit upon
notice, lapse of time or both any holder of any other
Indebtedness (other any Guaranty permitted by the proviso to
the preceding CLAUSE (1)) of the Borrower or any of its
Restricted Subsidiaries to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or
payable prior to its stated maturity;
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(c) is not party to any agreement, contract, arrangement or
understanding with the Borrower or any Restricted Subsidiary of the
Borrower unless the terms of any such agreement, contract, arrangement
or understanding are no less favorable to the Borrower or such
Restricted Subsidiary than those that might be obtained at the time
from Persons who are not Affiliates of the Borrower;
(d) is a Person with respect to which neither the Borrower nor
any of its Restricted Subsidiaries has any direct or indirect
obligation (1) to subscribe for additional Stock or (2) to maintain or
preserve such Person's financial condition or to cause such Person to
achieve any specified levels of operating results;
(e) has not guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Borrower or any of
its Restricted Subsidiaries; and
(f) has at least one director on its board of directors that
is not a director or executive officer of the Borrower or any of its
Restricted Subsidiaries and has at least one executive officer that is
not a director or executive officer of the Borrower or any of its
Restricted Subsidiaries.
Unless so designated as an Unrestricted Subsidiary, any Person
that is or becomes a Subsidiary of the Borrower will be classified as a
Restricted Subsidiary.
Upon designation of a Restricted Subsidiary as an Unrestricted
Subsidiary in compliance with this covenant, such Restricted Subsidiary shall be
released from any Guaranty previously made by such Restricted Subsidiary.
The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary, if, immediately after giving PRO FORMA
effect to such designation, no Default or Event of Default shall have occurred
and be continuing or would result therefrom.
Any such designation or redesignation by the Board of
Directors will be evidenced to the Administrative Agent by filing with the
Administrative Agent (within five Business Days after adoption of such
resolution) a board resolution giving effect to such designation or
redesignation and an officers' certificate signed by two Responsible Officers
that:
(a) certifies that such designation or redesignation complies
with the preceding provisions; and
(b) gives the effective date of such designation or
redesignation.
The Company shall not enter into, or permit a Restricted
Subsidiary to enter into, any transaction with an Unrestricted Subsidiary that,
if in effect at the time of designation of such Subsidiary as an Unrestricted
Subsidiary, would be inconsistent with the above restrictions as to designation
of Restricted Subsidiaries as Unrestricted Subsidiaries.
ARTICLE VII
NEGATIVE COVENANTS
As long as any of the Obligations or the Revolving Credit
Commitments remain outstanding, without the written consent of the Requisite
Lenders, the Borrower agrees with the Lenders and the Administrative Agent that:
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SECTION 7.1 LIENS, ETC.
The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, create or suffer to exist, any Lien upon or with
respect to any of its properties or assets, whether now owned or hereafter
acquired, or assign, or permit any of its Restricted Subsidiaries to assign, any
right to receive income, except for:
(a) Liens (other than Customary Permitted Liens and purchase
money Liens) granted by the Borrower or any Restricted Subsidiary of
the Borrower existing on the date of this Agreement and disclosed on
SCHEDULE 7.1;
(b) Customary Permitted Liens of the Borrower and its
Restricted Subsidiaries;
(c) purchase money Liens granted by the Borrower or any
Restricted Subsidiary of the Borrower (including the interest of a
lessor under a Capital Lease and Liens to which any property is subject
at the time of the Borrower's or such Restricted Subsidiary's
acquisition thereof) and limited in each case to the property purchased
with the proceeds of such purchase money Indebtedness or subject to
such Capital Lease; PROVIDED, HOWEVER, that no Lien that attaches to
any Borrowing Base Asset shall be permitted by this CLAUSE (C);
(d) any Lien securing the renewal, extension, refinancing or
refunding of any Indebtedness secured by any Lien permitted by CLAUSES
(A), (C) or (D) of this Section 7.1 without any material change in the
assets subject to such Lien;
(e) Liens on its interest in Joint Ventures securing
Indebtedness of such Joint Ventures;
(f) Liens on the office building owned by Newmark Homes, L.P.
located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇; and
(g) Liens not otherwise permitted by clauses (a) through (f)
above on Indebtedness not in excess of $25,000,000;
PROVIDED that at the time any such Liens are incurred, and after giving effect
thereto, the then Available Credit shall be greater than zero.
SECTION 7.2 INVESTMENTS.
The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly make or maintain any
Investment except:
(a) Investments existing on the date of this Agreement and
disclosed on SCHEDULE 7.2;
(b) Investments in cash and Cash Equivalents;
(c) Investments in accounts, contract rights and chattel paper
(each as defined in the Uniform Commercial Code), notes receivable and
similar items arising or acquired in the ordinary course of business
consistent with the past practice of the Borrower and its Subsidiaries;
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(d) Investments received in settlement of amounts due to the
Borrower or any Subsidiary of the Borrower effected in the ordinary
course of business;
(e) Investments by (i) the Borrower in any Guarantor, or by
any Guarantor in the Borrower or any other Guarantor, or (ii) a
Subsidiary that is not a Guarantor in the Borrower or any other
Restricted Subsidiary, or (iii) the Borrower or any Guarantor in the
Borrower's Subsidiaries engaged in the business of originating
residential home loans, title insurance and reinsurance not to exceed
in the aggregate at any time 10% of Adjusted Consolidated Tangible Net
Worth;
(f) loans or advances to employees of the Borrower or any of
its Subsidiaries in the ordinary course of business, which loans and
advances shall not exceed the aggregate outstanding principal amount of
$5,000,000 at any time;
(g) advances on sales commissions to the sales agents of the
Borrower or any of its Restricted Subsidiaries;
(h) Investments in the same or a complimentary line of
business as the Borrower not otherwise permitted hereby in an aggregate
outstanding amount not to exceed $10,000,000 at any time;
(i) net cash Investments (including letters of credit) in,
contributions and loans to Unaffiliated Joint Ventures and Unaffiliated
Unrestricted Subsidiaries, the then cost value of which shall not at
any time exceed in the aggregate for all such Investments 25% of the
Adjusted Consolidated Tangible Net Worth of the Borrower and its
Restricted Subsidiaries (with cost value determined to the aggregate
cost PLUS all additions MINUS all returns thereon in cash);
(j) Investments in Permitted Acquisitions; and
(k) Investments under deferred compensation agreements.
SECTION 7.3 RESTRICTED PAYMENTS.
The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, declare, order, pay, make or
set apart any sum for any Restricted Payment except for the following:
(a) Restricted Payments by any Subsidiary of the Borrower to
the Borrower or any Restricted Subsidiary; and
(b) payments of principal of, or premium on, the Subordinated
Notes prior to the stated maturity thereof not to exceed $25,000,000;
and
(c) other Restricted Payments in any period of four
consecutive fiscal quarters not to exceed 3% of the aggregate amount of
Consolidated Net Income for such four fiscal quarter period;
PROVIDED, HOWEVER, that the Restricted Payments described in clause (b)
or (c) above shall not be permitted if either (A) an Event of Default
or Default shall have occurred and be continuing at the date of
declaration or payment thereof or would result therefrom or (B) such
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Restricted Payment is prohibited under the terms of any Indebtedness
(other than the Obligations) of the Borrower or any of its
Subsidiaries; PROVIDED, FURTHER, that (i) the Restricted Payments
described in clause (b) or (c) above shall not be permitted unless
before and after giving effect to such Restricted Payments, the
Borrower shall be in compliance with the financial covenants contained
in Article V on a PRO FORMA basis; and
(d) dividends and distributions on the common stock of the
Borrower paid solely in shares of the common Stock of the Borrower.
SECTION 7.4 RESTRICTION ON FUNDAMENTAL CHANGES.
The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to enter into an agreement to affect, or effect, a
Permitted Acquisition, if at the time thereof and after giving effect thereto,
there would be a Default or Event of Default. Except for Permitted Acquisitions,
the Borrower shall not, and shall not permit any of its Restricted Subsidiaries
to (a) merge with any Person other than any Restricted Subsidiary into the
Borrower or any Guarantor, as long as the surviving entity of such merger is the
Borrower or a Guarantor, (b) consolidate with any Person other than any
Restricted Subsidiary into the Borrower or any Guarantor, as long as the
surviving entity of such consolidation is the Borrower or a Guarantor, (c)
acquire all or substantially all of the Stock or Stock Equivalents of any
Person, (d) acquire all or substantially all of the assets of any Person or all
or substantially all of the assets constituting the business of a division,
branch or other unit operation of any Person, (e) enter into any Joint Venture
or partnership with any Person, other than pursuant to an Investment made
pursuant to Section 7.2 or (f) create any Restricted Subsidiary unless, (I)
after giving effect to such creation or acquisition, (x) no Default or Event of
Default shall have occurred or be continuing, and (y) the Borrower is in
compliance with Section 6.13, and (II) such Restricted Subsidiary is either (i)
a Wholly-Owned Restricted Subsidiary, or (ii) created in connection with an
Investment permitted pursuant to Section 7.2.
SECTION 7.5 CHANGE IN NATURE OF BUSINESS.
The Borrower shall not, and shall not permit any of its
Subsidiaries to, make any material change in the nature or conduct of its
business as carried on at the date hereof.
SECTION 7.6 TRANSACTIONS WITH AFFILIATES.
The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, except as otherwise expressly permitted herein, do
any of the following: (a) make any Investment in an Affiliate of the Borrower
that is not a Restricted Subsidiary of the Borrower; (b) transfer, sell, lease,
assign or otherwise dispose of any asset to any Affiliate of the Borrower that
is not a Restricted Subsidiary of the Borrower; (c) merge into or consolidate
with or purchase or acquire assets from any Affiliate of the Borrower that is
not a Restricted Subsidiary of the Borrower; (d) repay any Indebtedness to any
Affiliate of the Borrower that is not a Restricted Subsidiary of the Borrower;
or (e) enter into any other transaction directly or indirectly with or for the
benefit of any Affiliate of the Borrower that is not a Guarantor (including
guaranties and assumptions of obligations of any such Affiliate), except for (i)
transactions in the ordinary course of business on a basis no less favorable to
the Borrower or such Guarantor as would be obtained in an arm's length
transaction with a Person not an Affiliate, (ii) salaries and other director or
employee compensation or benefits to officers or directors of the Borrower or
any of its Subsidiaries commensurate with current compensation and benefits
levels, and (iii) indemnities of officers, directors and employees of the
Borrower and its Subsidiaries permitted by their respective organizational
documents and by applicable law; PROVIDED, HOWEVER, that the Borrower shall not
be prohibited under this Section 7.6 from (x) making payments of up to
$3,500,000 per fiscal year to ▇▇▇▇ under the Management Services Agreement (or
another similar agreement) or (y) performing its obligations under the Tax
Allocation Agreement.
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SECTION 7.7 RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS; NO NEW
NEGATIVE PLEDGE.
The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, (a) except as set forth on SCHEDULE 7.7, agree to
enter into or suffer to exist or become effective any consensual encumbrance or
restriction of any kind on the ability of such Restricted Subsidiary to pay
dividends or make any other distribution or transfer of funds or assets or make
loans or advances to or other Investments in, or pay any Indebtedness owed to,
the Borrower or any other Restricted Subsidiary of the Borrower, except for
customary profit allocation provisions or (b) enter into or suffer to exist or
become effective any agreement prohibiting or limiting the ability of the
Borrower or any Restricted Subsidiary of the Borrower to create, incur, assume
or suffer to exist any Lien upon any of its property, assets or revenues,
whether now owned or hereafter acquired, to secure the Obligations, including
any agreement requiring any other Indebtedness or Contractual Obligation of the
Borrower or any of its Restricted Subsidiaries to be equally and ratably secured
with the Obligations.
SECTION 7.8 SALE/LEASEBACKS.
The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, enter into any sale and leaseback transaction
covering any property with an aggregate Fair Market Value in excess of
$10,000,000; PROVIDED, HOWEVER, that the Borrower and its Restricted
Subsidiaries may sell Model Homes in the ordinary course of business and
leaseback such Model Homes for a term not to exceed three years so long as none
of the Borrower or any of its Subsidiaries has any obligation to sell or
repurchase the leased Model Homes at the end of the lease term.
SECTION 7.9 COMPLIANCE WITH ERISA.
The Borrower shall not cause or permit to occur, and shall not
permit any of its Restricted Subsidiaries to cause or permit to occur, or cause
or permit any ERISA Affiliate to cause or permit to occur (a) an event which
could result in the imposition of a Lien under Section 412 of the IRC or Section
302 or 4068 of ERISA or (b) an ERISA Event that would have a Material Adverse
Effect.
SECTION 7.10 ENVIRONMENTAL.
The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, allow a Release of any Contaminant in violation of
any Environmental Law, or otherwise violate any Environmental Law; PROVIDED,
HOWEVER, that the Borrower shall not be deemed in violation of this Section 7.10
if, all such violations could not reasonably be expected to have a Material
Adverse Effect.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1 EVENTS OF DEFAULT.
Each of the following events shall be an Event of Default:
(a) the Borrower shall fail to pay any principal of any Loan
or any Reimbursement Obligation when the same becomes due and payable;
or
(b) the Borrower shall fail to pay any interest on any Loan,
any fee under any of the Loan Documents or any other Obligation (other
than one referred to in clause (a) above) and such non-payment
continues for a period of five calendar days after the due date
therefor;
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(c) any representation or warranty made or deemed made by any
Loan Party in any Loan Document or by any Loan Party (or any of its
officers) in connection with any Loan Document shall prove to have been
incorrect in any material respect when made or deemed made; or
(d) any Loan Party shall fail to perform or observe any term,
covenant or agreement contained in this Agreement or in any other Loan
Document, if such failure shall remain unremedied for 30 days after the
date on which written notice thereof shall have been given to the
Borrower by the Administrative Agent or any Lender; or
(e) (i) the Borrower or any of its Restricted Subsidiaries
shall fail to make any payment on any Indebtedness (other than the
Obligations) of the Borrower or any such Restricted Subsidiary, and in
each such case, such failure relates to Indebtedness having a principal
amount of $5,000,000 or more, when the same becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise); or (ii) any other event shall occur or condition
shall exist under any agreement or instrument relating to any
Indebtedness of the Borrower or any of its Restricted Subsidiaries
having a principal amount of $5,000,000 or more, if the effect of such
event or condition is to accelerate, or to permit the acceleration of,
the maturity of such Indebtedness; or (iii) any Indebtedness of the
Borrower and any of its Restricted Subsidiaries having a principal
amount of $5,000,000 or more shall become or be declared to be due and
payable, or required to be prepaid or repurchased (other than by a
regularly scheduled required prepayment), prior to the stated maturity
thereof; or
(f) (i) the Borrower or any of its Restricted Subsidiaries
shall generally not pay its debts as such debts become due, shall admit
in writing its inability to pay its debts generally or shall make a
general assignment for the benefit of creditors, (ii) any proceeding
shall be instituted by or against the Borrower or any of its Restricted
Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under
any Requirement of Law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order
for relief or the appointment of a custodian, receiver, trustee or
other similar official for it or for any substantial part of its
property; PROVIDED, HOWEVER, in the case of any such proceedings
instituted against the Borrower or any of its Restricted Subsidiaries
(but not instituted by the Borrower or any of its Restricted
Subsidiaries), either such proceedings shall remain undismissed or
unstayed for a period of 30 days or any of the actions sought in such
proceedings shall occur, or (iii) the Borrower or any of its Restricted
Subsidiaries shall take any corporate action to authorize any of the
actions set forth above in clauses (i) and (ii) of this subsection (f);
or
(g) any final judgment or order (or other similar process)
involving, in any single case or in the aggregate, an amount in excess
of $5,000,000 in the case of a money judgment, to the extent not
covered by insurance, or that could reasonably be expected to have a
Material Adverse Effect, in the case of a non-monetary judgment, shall
be rendered against one or more of the Borrower and its Restricted
Subsidiaries by a court having jurisdiction, and such judgment or order
shall continue unsatisfied and in effect for a period of thirty days
without being vacated, discharged, satisfied, or stayed or bonded
pending appeal; or
(h) an ERISA Event shall occur and the amount of all
liabilities and deficiencies resulting therefrom that are or are
reasonably likely to be imposed on the Borrower, any Restricted
Subsidiary of the Borrower or any ERISA Affiliate, whether or not
assessed, exceeds $1,000,000 in the aggregate;
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(i) any material provision of any Guaranty after delivery
thereof pursuant to this Agreement or any other Loan Document shall for
any reason cease to be valid and binding, or enforceable against, on
any Loan Party thereto, or any Loan Party shall so state in writing; or
(j) there shall occur any Change of Control; or
(k) one or more of the Borrower and its Restricted
Subsidiaries shall have entered into one or more consent or settlement
decrees or agreements or similar arrangements with a Governmental
Authority or one or more judgments, orders, decrees or similar actions
shall have been entered against one or more of the Borrower and its
Restricted Subsidiaries based on or arising from the violation of or
pursuant to any Environmental Law, or the generation, storage,
transportation, treatment, disposal or Release of any Contaminant and,
in connection with all the foregoing, the Borrower and its Restricted
Subsidiaries are likely to incur environmental liabilities and costs in
excess of $15,000,000 in the aggregate.
SECTION 8.2 REMEDIES.
During the continuance of any Event of Default, the
Administrative Agent (a) may, and at the request of the Requisite Lenders shall,
by notice to the Borrower declare that all or any portion of the Revolving
Credit Commitments be terminated, whereupon the obligation of each Lender to
make any Loan and each Issuer to Issue any Letter of Credit shall immediately be
decreased or terminate, as the case may be, and/or (b) may, and at the request
of the Requisite Lenders shall, by notice to the Borrower, declare the Loans,
all interest thereon and all other amounts and Obligations payable under this
Agreement to be forthwith due and payable, whereupon the Loans, all such
interest and all such amounts and Obligations shall immediately become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower;
PROVIDED, HOWEVER, that upon the occurrence of the Events of Default specified
in Section 8.1(f)(ii), the Revolving Credit Commitments of each Lender to make
Loans and the commitments of each Lender and Issuer to Issue or participate in
Letters of Credit shall each automatically be terminated and the Loans, all such
interest and all such amounts and Obligations shall automatically become and be
due and payable, without presentment, demand, protest or any notice of any kind,
all of which are hereby expressly waived by the Borrower.
SECTION 8.3 ACTIONS IN RESPECT OF LETTERS OF CREDIT.
If at any time the Revolving Credit Commitments terminate
while any Letters of Credit are outstanding or any Event of Default shall have
occurred and be continuing, the Borrower shall (x) pay to the Administrative
Agent in immediately available funds at the Administrative Agent's office
referred to in Section 10.8, for deposit in a cash collateral account, an amount
equal to 102.5% of the sum of all outstanding Letter of Credit Obligations or
(y) make such other arrangements in respect of outstanding Letters of Credit as
shall be acceptable to the Requisite Lenders. Amounts held in such cash
collateral account shall be applied by the Administrative Agent to the payment
of Reimbursement Obligations, and the unused portion thereof after all such
Letters of Credit shall have expired or been fully drawn upon, if any, shall be
applied in accordance with clause (f) of Section 2.12. The Administrative Agent
shall promptly give notice of any such application; PROVIDED, HOWEVER, that the
failure to give such written notice shall not invalidate any such application.
Promptly after all such Letters of Credit shall have expired or been fully drawn
upon and all other obligations of the Borrower hereunder and under the Revolving
Credit Notes shall have been paid in full, the balance, if any, in such cash
collateral account shall be returned to the Borrower.
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SECTION 8.4 RESCISSION.
If at any time after termination of the Revolving Credit
Commitments and/or acceleration of the maturity of the Loans, the Borrower shall
pay all arrears of interest and all payments on account of principal of the
Loans and Reimbursement Obligations that shall have become due otherwise than by
acceleration (with interest on principal and, to the extent permitted by law, on
overdue interest, at the rates specified herein) and all Events of Default and
Defaults (other than non-payment of principal of and accrued interest on the
Loans due and payable solely by virtue of acceleration) shall be remedied or
waived pursuant to Section 10.1, then upon the written consent of the Requisite
Lenders and written notice to the Borrower, the termination of the Revolving
Credit Commitments and/or the acceleration and their consequences may be
rescinded and annulled; PROVIDED, however, that such action shall not affect any
subsequent Event of Default or Default or impair any right or remedy consequent
thereon. The provisions of the preceding sentence are intended merely to bind
the Lenders and the Issuers to a decision that may be made at the election of
the Requisite Lenders; and such provisions are not intended to benefit the
Borrower and do not give the Borrower the right to require the Lenders to
rescind or annul any acceleration hereunder, even if the conditions set forth
herein are met.
ARTICLE IX
THE ADMINISTRATIVE AGENT
SECTION 9.1 AUTHORIZATION AND ACTION.
(a) Each Lender and each Issuer hereby appoints CNAI as the
Administrative Agent hereunder and each Lender and each Issuer authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement and the other Loan Documents as are delegated
to the Administrative Agent under such agreements and to exercise such powers as
are reasonably incidental thereto. Without limiting the foregoing, each Lender
and each Issuer hereby authorizes the Administrative Agent to execute and
deliver, and to perform its obligations under, each of the Loan Documents to
which the Administrative Agent is a party and to exercise all rights, powers and
remedies that the Administrative Agent may have under such Loan Documents
pursuant to which the Administrative Agent is acting as agent for the Lenders
and the Issuers.
(b) As to any matters not expressly provided for by this
Agreement and the other Loan Documents (including enforcement or collection),
the Administrative Agent shall not be required to exercise any discretion or
take any action, but shall be required to act or to refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of the Requisite Lenders, and such instructions shall be binding
upon all Lenders and each Issuer; PROVIDED, HOWEVER, that the Administrative
Agent shall not be required to take any action that (i) the Administrative Agent
in good faith believes exposes it to personal liability unless the
Administrative Agent receives an indemnification satisfactory to it from the
Lenders and the Issuers with respect to such action or (ii) is contrary to this
Agreement or applicable law. The Administrative Agent agrees to give to each
Lender and each Issuer prompt notice of each notice given to it by any Loan
Party pursuant to the terms of this Agreement or the other Loan Documents.
(c) In performing its functions and duties hereunder and under
the other Loan Documents, the Administrative Agent is acting solely on behalf of
the Lenders and the Issuers and its duties are entirely administrative in
nature. The Administrative Agent does not assume and shall not be deemed to have
assumed any obligation other than as expressly set forth herein and in the other
Loan Documents or any other relationship as the agent, fiduciary or trustee of
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or for any Lender, Issuer or holder of any other Obligation. The Administrative
Agent may perform any of its duties under any Loan Document by or through its
agents or employees.
SECTION 9.2 ADMINISTRATIVE AGENT'S RELIANCE, ETC.
None of the Administrative Agent, any of its Affiliates or any
of their respective directors, officers, agents or employees shall be liable for
any action taken or omitted to be taken by it, him, her or them under or in
connection with this Agreement or the other Loan Documents, except for its, his,
her or their own gross negligence or willful misconduct. Without limiting the
foregoing, the Administrative Agent (a) may treat the payee of any Revolving
Credit Note as its holder until such Revolving Credit Note has been assigned in
accordance with Section 10.2, (b) may rely on the Register to the extent set
forth in Section 10.2(c), (c) may consult with legal counsel (including counsel
to the Borrower or any other Loan Party), independent public accountants and
other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts, (d) makes no warranty or representation to any
Lender or Issuer and shall not be responsible to any Lender or Issuer for any
statements, warranties or representations made by or on behalf of the Borrower
or any of its Subsidiaries in or in connection with this Agreement or any other
Loan Document, (e) shall not have any duty to ascertain or to inquire either as
to the performance or observance of any terms, covenant or condition of this
Agreement or any other Loan Document, as to the financial condition of any Loan
Party or as to the existence or possible existence of any Default or Event of
Default; (f) shall not be responsible to any Lender or Issuer for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of, or the attachment, perfection or priority of any Lien created or purported
to be created under or in connection with, this Agreement, any other Loan
Document or any other instrument or document furnished pursuant hereto or
thereto; and (g) shall incur no liability under or in respect of this Agreement
or any other Loan Document by acting upon any notice, consent, certificate or
other instrument or writing (which may be a telecopy or electronic mail) or any
telephone message believed by it to be genuine and signed or sent by the proper
party or parties.
SECTION 9.3 THE ADMINISTRATIVE AGENT INDIVIDUALLY.
With respect to its Ratable Portion, CNAI shall have and may
exercise the same rights and powers hereunder and is subject to the same
obligations and liabilities as and to the extent set forth herein for any other
Lender. The terms "LENDERS" or "REQUISITE LENDERS," "LENDERS," and any similar
terms shall, unless the context clearly otherwise indicates, include, without
limitation, the Administrative Agent in its individual capacity as a Lender or
as one of the Requisite Lenders. CNAI and its Affiliates may accept deposits
from, lend money to, and generally engage in any kind of banking, trust or other
business with any Loan Party as if CNAI were not acting as the Administrative
Agent.
SECTION 9.4 LENDER CREDIT DECISION.
Each Lender and each Issuer acknowledges that it shall,
independently and without reliance upon the Administrative Agent or any other
Lender conduct its own independent investigation of the financial condition and
affairs of the Borrower and each other Loan Party in connection with the making
and continuance of the Loans and with the issuance of the Letters of Credit.
Each Lender and each Issuer also acknowledges that it shall, independently and
without reliance upon the Administrative Agent or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement and other Loan Documents.
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SECTION 9.5 INDEMNIFICATION.
Each Lender agrees to indemnify the Administrative Agent and
each of its Affiliates, and each of their respective directors, officers,
employees, agents and advisors (to the extent not reimbursed by the Borrower),
from and against such Lender's aggregate Ratable Portion of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses and disbursements (including reasonable fees, expenses and
disbursements of financial and legal advisors) of any kind or nature whatsoever
that may be imposed on, incurred by, or asserted against, the Administrative
Agent or any of its Affiliates, directors, officers, employees, agents and
advisors in any way relating to or arising out of this Agreement or the other
Loan Documents or any action taken or omitted by the Administrative Agent under
this Agreement or the other Loan Documents; PROVIDED, HOWEVER, that no Lender
shall be liable to the Administrative Agent and any of its Affiliates, and any
of their respective directors, officers, employees, agents and advisors for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from such
Administrative Agent's, Affiliates', directors', officers', employees', agents'
or advisors' gross negligence or willful misconduct. Without limiting the
foregoing, each Lender agrees to reimburse the Administrative Agent promptly
upon demand for its ratable share of any out-of-pocket expenses (including
reasonable fees, expenses and disbursements of financial and legal advisors)
incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of its rights or responsibilities under, this Agreement or the
other Loan Documents, to the extent that the Administrative Agent is not
reimbursed for such expenses by the Borrower or another Loan Party.
SECTION 9.6 SUCCESSOR ADMINISTRATIVE AGENT.
The Administrative Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower. Upon any such
resignation, the Requisite Lenders shall have the right to appoint a successor
Administrative Agent. If no successor Administrative Agent shall have been so
appointed by the Requisite Lenders, and shall have accepted such appointment,
within 30 days after the retiring Administrative Agent's giving of notice of
resignation, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent, selected from among the
Lenders. In either case, such appointment shall be subject to the prior written
approval of the Borrower (which approval may not be unreasonably withheld and
shall not be required upon the occurrence and during the continuance of an Event
of Default). Upon the acceptance of any appointment as Administrative Agent by a
successor Administrative Agent, such successor Administrative Agent shall
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations under this Agreement and the
other Loan Documents. Prior to any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the retiring Administrative Agent shall take
such action as may be reasonably necessary to assign to the successor
Administrative Agent its rights as Administrative Agent under the Loan
Documents. After such resignation, the retiring Administrative Agent shall
continue to have the benefit of this Article IX as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this Agreement
and the other Loan Documents. Anything herein to the contrary notwithstanding,
the Administrative Agent shall resign if at any time the Administrative Agent is
not a Lender having a Revolving Credit Commitment of at least $10,000,000 (or
such ratably lesser amount if the Revolving Credit Commitments have been reduced
in accordance with this Agreement).
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ARTICLE X
MISCELLANEOUS
SECTION 10.1 AMENDMENTS, WAIVERS, ETC.
(a) No amendment or waiver of any provision of this Agreement
or any other Loan Document nor consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be in writing
and signed by the Requisite Lenders (or by the Administrative Agent with the
consent of the Requisite Lenders) and, in the case of any amendment, by the
Borrower, and then any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; PROVIDED,
HOWEVER, that no amendment, waiver or consent shall, unless in writing and
signed by each Lender affected thereby, in addition to the Requisite Lenders, do
any of the following:
(i) increase the Revolving Credit Commitment of such Lender or
subject such Lender to any additional obligation; PROVIDED, HOWEVER,
that, except as provided in Section 2.18, any such increase in the
Revolving Credit Commitment of such Lender shall require the consent of
all Lenders;
(ii) extend the then scheduled final maturity of any Loan
owing to such Lender, except as provided in Section 2.17;
(iii) reduce the principal amount of any Loan or Reimbursement
Obligation owing to such Lender (other than by the payment or
prepayment thereof);
(iv) reduce the rate of interest on any Loan or Reimbursement
Obligations outstanding to such Lender or any fee payable hereunder to
such Lender;
(v) postpone any scheduled date fixed for payment of such
interest or fees owing to such Lender;
(vi) change the aggregate Ratable Portions of Lenders required
for any or all Lenders to take any action hereunder;
(vii) release the Borrower from its payment obligation to such
Lender under this Agreement or the Revolving Credit Notes owing to such
Lender (if any) or release any Guarantor from its obligations under the
Guaranty except in connection with sale or other disposition of a
Guarantor (or all or substantially all of the assets thereof) or as
otherwise specifically provided herein; or
(viii) amend this Section 10.1 or the definition of the term
"REQUISITE LENDERS";
and PROVIDED, FURTHER, that no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent, the Issuer or the Swing Loan
Lender, as the case may be, in addition to the Lenders required above to take
such action, affect the rights or duties of the Administrative Agent, the Issuer
or the Swing Loan Lender, as the case may be, under this Agreement or the other
Loan Documents.
(b) The Administrative Agent may, but shall have no obligation
to, with the written concurrence of any Lender, execute amendments,
modifications, waivers or consents on behalf of such 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 the Borrower in any
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case shall entitle the Borrower to any other or further notice or demand in
similar or other circumstances.
(c) If, in connection with any proposed amendment,
modification, waiver or termination (a "PROPOSED CHANGE") requiring the consent
of all affected Lenders, the consent of Requisite Lenders is obtained, but the
consent of other Lenders whose consent is required is not obtained (any such
Lender whose consent is not obtained as described in this Section 10.1 being
referred to as a "NON-CONSENTING LENDER"), then, so long as the Lender that is
acting as the Administrative Agent is not a Non-Consenting Lender, at the
Borrower's request, each other Lender shall have a right to purchase its PRO
RATA share of such Non-Consenting Lender's Revolving Credit Commitment and
Revolving Credit Outstandings, and if such Lenders do not purchase all of such
Non-Consenting Lender's Revolving Credit Commitment or Revolving Credit
Outstandings, an Eligible Assignee acceptable to the Administrative Agent shall
have the right with the Administrative Agent's consent and in the Administrative
Agent's sole discretion (but shall have no obligation) to purchase from such
Non-Consenting Lender, and such Non-Consenting Lender agrees that it shall, upon
the Administrative Agent's request, sell and assign to the Lender acting as the
Administrative Agent or such Eligible Assignee, all of the Revolving Credit
Commitments, and Revolving Credit Outstandings of such Non-Consenting Lender for
an amount equal to the principal balance of all Loans held by the Non-Consenting
Lender and all accrued interest and fees with respect thereto and all other
amounts through the date of sale, PROVIDED, HOWEVER, that such purchase and sale
shall not be effective until the Administrative Agent shall have received from
such Eligible Assignee an agreement in form and substance satisfactory to the
Administrative Agent and the Borrower whereby such Eligible Assignee shall agree
to be bound by the terms hereof. Each Lender agrees that, if it becomes a
Non-Consenting Lender, it shall execute and deliver to the Administrative Agent
an Assignment an Acceptance to evidence such sale and purchase and shall deliver
to the Administrative Agent any Revolving Credit Note (if the assigning Lender's
Loans are evidenced by a Revolving Credit Note) subject to such Assignment and
Acceptance; PROVIDED, HOWEVER, that the failure of any Non-Consenting Lender to
execute an Assignment and Acceptance shall not render such sale and purchase
(and the corresponding assignment) invalid.
SECTION 10.2 ASSIGNMENTS AND PARTICIPATIONS.
(a) Each Lender may sell, transfer, negotiate or assign to one
or more Eligible Assignees all or a portion of its rights and obligations
hereunder (including all of its rights and obligations with respect to the
Revolving Loans, the Swing Loans and the Letters of Credit); PROVIDED, HOWEVER,
that (i) if any such assignment shall be of the assigning Lender's Revolving
Credit Outstandings and Revolving Credit Commitments, such assignment shall
cover the same percentage of such Lender's Revolving Credit Outstandings and
Revolving Credit Commitments, (ii) the aggregate amount being assigned pursuant
to each such assignment (determined as of the date of the Assignment and
Acceptance with respect to such assignment) shall in no event (if less than the
Assignor's entire interest) be less than $5,000,000 or an integral multiple of
$1,000,000 in excess thereof, except, in either case, (A) with the consent of
the Borrower and the Administrative Agent or (B) if such assignment is being
made to a Lender or an Affiliate or Approved Fund of such Lender, and (iii) if
such Eligible Assignee is not, prior to the date of such assignment, a Lender or
an Affiliate or Approved Fund of a Lender, such assignment shall be subject to
the prior consent of the Administrative Agent, the Swing Loan Lender, each
Issuer and the Borrower (which consent shall not be unreasonably withheld or
delayed); and PROVIDED, FURTHER, that, notwithstanding any other provision of
this Section 10.2, the consent of the Borrower shall not be required for any
assignment occurring when any Event of Default shall have occurred and be
continuing.
(b) The parties to each such assignment shall execute and
deliver to the Administrative Agent, for its acceptance and recording, an
Assignment and Acceptance, together with any Revolving Credit Note (if the
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assigning Lender's Loans are evidenced by a Revolving Credit Note) subject to
such assignment. In addition, any Lender or Eligible Assignee assuming a
Revolving Credit Commitment in connection with a Facility Increase shall execute
an Assumption Agreement in accordance with Section 2.18. Upon such execution,
delivery, acceptance and recording of any Assignment and Acceptance or
Assumption Agreement, as the case may be, and, other than in respect of
assignment made pursuant to Section 2.16 and Section 10.1(c), the receipt by the
Administrative Agent from the assignee of an assignment/assumption fee in the
amount of $3,500, then from and after the effective date specified in such
Assignment and Acceptance or Assumption Agreement, as the case may be, (i) the
assignee thereunder shall become a party hereto and, to the extent that rights
and obligations under the Loan Documents have been assigned to such assignee
pursuant to such Assignment and Acceptance or assumed by such assuming party
pursuant to such Assumption Agreement, have the rights and obligations of a
Lender, and, in the case of an assignment, if such Lender were an Issuer, of
such Issuer hereunder and thereunder, and (ii) the assignor under an Assignment
and Acceptance shall, to the extent that rights and obligations under this
Agreement have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights (except for those surviving the payment in full of the
Obligations) and be released from its obligations under the Loan Documents,
other than those relating to events or circumstances occurring prior to such
assignment (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender's rights and obligations under the Loan
Documents, such Lender shall cease to be a party hereto).
(c) The Administrative Agent shall maintain at its address
referred to in Section 10.8 a copy of each Assignment and Acceptance and each
Assumption Agreement delivered to and accepted by it and a register for the
recording of the names and addresses of the Lenders and the Revolving Credit
Commitments of and principal amount of the Loans and Letter of Credit
Obligations owing to each Lender from time to time (the "REGISTER"). Any
assignment pursuant to this Section 10.2 shall not be effective until such
assignment is recorded in the Register. The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the Loan
Parties, the Administrative Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender for all purposes of this Agreement.
The Register shall be available for inspection by the Borrower, the
Administrative Agent or any Lender at any reasonable time and from time to time
upon reasonable prior notice.
(d) Notwithstanding anything to the contrary contained in
clause (b) above, the Loans (including the Revolving Credit Notes evidencing
such Loans) are registered obligations and the right, title, and interest of the
Lenders and their assignees in and to such Loans shall be transferable only upon
notation of such transfer in the Register. A Revolving Credit Note shall only
evidence the Lender's or an assignee's right, title and interest in and to the
related Loan, and in no event is any such Revolving Credit Note to be considered
a bearer instrument or obligation. This Section 10.2 shall be construed so that
the Loans are at all times maintained in "REGISTERED FORM" within the meaning of
Sections 163(f), 871(h)(2) and 881(c)(2) of the Internal Revenue Code or such
regulations. Solely for purposes of this and for tax purposes only, the
Administrative Agent shall act as the Borrower's agent for purposes of
maintaining such notations of transfer in the Register.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an assignee or an Assumption Agreement executed by
the Borrower and a Lender or an Eligible Assignee, the Administrative Agent
shall, if such Assignment and Acceptance or Assumption Agreement has been
completed, (i) accept such Assignment and Acceptance or Assumption Agreement,
(ii) record the information contained therein in the Register and (iii) in the
case of an Assignment and Acceptance, give prompt notice thereof to the
Borrower. Within five Business Days after its receipt of such notice, the
Borrower, at its own expense, shall, if requested by such assignee, execute and
deliver to the Administrative Agent, new Revolving Credit Notes to the order of
such assignee in an amount equal to the Revolving Credit Commitments assumed by
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it pursuant to such Assignment and Acceptance or Assumption Agreement and, if
the assigning Lender, in the case of an Assignment and Acceptance, has
surrendered any Revolving Credit Note for exchange in connection with the
assignment and has retained Revolving Credit Commitments hereunder, new
Revolving Credit Notes to the order of the assigning Lender in an amount equal
to the Revolving Credit Commitments retained by it hereunder. Such new Revolving
Credit Notes shall be dated the same date as the surrendered Revolving Credit
Notes and be in substantially the form of EXHIBIT C.
(f) In addition to the other assignment rights provided in
this Section 10.2, each Lender may assign, as collateral or otherwise, any of
its rights under this Agreement, whether now owned or hereafter acquired
(including rights to payments of principal or interest on the Loans), to (x) any
Federal Reserve Bank pursuant to Regulation A of the Federal Reserve Board
without notice to or consent of the Borrower or (y) in the case of any Lender
that is a Fund, any holders of obligations owed or Securities issued by such
Lender as security for such obligations or Securities or any trustee for, or
other representative of, such holders, and this Section shall not apply to any
such pledge or assignment of a security interest; PROVIDED, HOWEVER, that no
such assignment shall release the assigning Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
(g) Each Lender may sell participations to one or more Persons
in or to all or a portion of its rights and obligations under the Loan Documents
(including all its rights and obligations with respect to the Revolving Loans
and Letters of Credit). The terms of such participation shall not, in any event,
require the participant's consent to any amendments, waivers or other
modifications of any provision of any Loan Documents, the consent to any
departure by any Loan Party therefrom, or to the exercising or refraining from
exercising any powers or rights such Lender may have under or in respect of the
Loan Documents (including the right to enforce the obligations of the Loan
Parties), except if any such amendment, waiver or other modification or consent
would reduce the amount, or postpone any date fixed for, any amount (whether of
principal, interest or fees) payable to such participant under the Loan
Documents, to which such participant would otherwise be entitled under such
participation. In the event of the sale of any participation by any Lender, (w)
such Lender's obligations under the Loan Documents shall remain unchanged, (x)
such Lender shall remain solely responsible to the other parties for the
performance of such obligations, (y) such Lender shall remain the holder of such
Obligations for all purposes of this Agreement, and (z) the Borrower, the
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Each participant shall be entitled to the
benefits of Section 2.14 and Section 2.15 and of Section 2.13(c) as if it were a
Lender; PROVIDED, HOWEVER, that anything herein to the contrary notwithstanding,
the Borrower shall not, at any time, be obligated to make under Section 2.14,
Section 2.15 or Section 2.13(c) to the participant in the rights and obligations
of any Lender (together with such Lender) any payment in excess of the amount
the Borrower would have been obligated to pay to such Lender in respect of such
interest had such participation not been sold.
(h) Any Issuer may at any time assign its rights and
obligations hereunder to any other Lender by an instrument in form and substance
satisfactory to the Borrower, the Administrative Agent, such Issuer and such
Eligible Assignee. If any Issuer ceases to be a Lender hereunder by virtue of
any assignment made pursuant to this Section 10.2, then, as of the effective
date of such cessation, such Issuer's obligations to Issue Letters of Credit
pursuant to Section 2.4 shall terminate and such Issuer shall be an Issuer
hereunder only with respect to outstanding Letters of Credit issued prior to
such date.
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SECTION 10.3 COSTS AND EXPENSES.
(a) The Borrower agrees upon demand to pay, or reimburse the
Administrative Agent for, all of the Administrative Agent's reasonable internal
and external audit, legal, appraisal, valuation, filing, document duplication
and reproduction and investigation expenses and for all other reasonable
out-of-pocket costs and expenses of every type and nature (including, without
limitation, after receipt of invoice documentation, the reasonable fees,
expenses and disbursements of the Administrative Agent's counsel, ▇▇▇▇▇▇ ▇▇▇▇▇▇
& ▇▇▇▇▇▇▇ LLP, local legal counsel, auditors, accountants, appraisers, printers,
insurance and environmental advisors, and other consultants and agents) incurred
by the Administrative Agent in connection with any of the following: (i) the
Administrative Agent's audit and investigation of the Borrower and its
Subsidiaries in connection with the preparation, negotiation or execution of any
Loan Document, (ii) the preparation, negotiation, execution or interpretation of
this Agreement (including, without limitation, the satisfaction or attempted
satisfaction of any conditions set forth in Article III), any Loan Document or
any proposal letter or commitment letter issued in connection therewith or the
making of the Loans hereunder, (iii) the ongoing administration of this
Agreement and the Loans, including consultation with attorneys in connection
therewith and with respect to the Administrative Agent's rights and
responsibilities hereunder and under the other Loan Documents, (iv) the
protection, collection or enforcement of any Obligation or the enforcement of
any Loan Document, (v) the commencement, defense or intervention in any court
proceeding relating in any way to the Obligations, any Loan Party, any of the
Borrower's Subsidiaries, this Agreement or any other Loan Document, (vi) the
response to, and preparation for, any subpoena or request for document
production with which the Administrative Agent is served or deposition or other
proceeding in which the Administrative Agent is called to testify, in each case,
relating in any way to the Obligations, any Loan Party, any of the Borrower's
Subsidiaries, this Agreement or any other Loan Documents or (vii) any amendment,
consent, waiver, assignment, restatement, or supplement to any Loan Document or
the preparation, negotiation, and execution of the same.
(b) The Borrower further agrees to pay or reimburse the
Administrative Agent and each of the Lenders and Issuers upon demand for all
out-of-pocket costs and expenses, including, without limitation, reasonable
attorneys' fees (including allocated costs of internal counsel and costs of
settlement), incurred by the Administrative Agent, such Lenders or Issuers in
connection with any of the following: (i) in enforcing any Loan Document or
Obligation or any security therefor or exercising or enforcing any other right
or remedy available by reason of an Event of Default, (ii) in connection with
any refinancing or restructuring of the credit arrangements provided hereunder
in the nature of a "work-out" or in any insolvency or bankruptcy proceeding,
(iii) in commencing, defending or intervening in any litigation or in filing a
petition, complaint, answer, motion or other pleadings in any legal proceeding
relating to the Obligations, any Loan Party, any of the Borrower's Subsidiaries
and related to or arising out of the transactions contemplated hereby or by any
other Loan Document or (iv) in taking any other action in or with respect to any
suit or proceeding (bankruptcy or otherwise) described in clause (i), (ii) or
(iii) above.
SECTION 10.4 INDEMNITIES.
(a) The Borrower agrees to indemnify and hold harmless the
Administrative Agent, each Arranger, each Lender and each of their respective
Affiliates, and each of the directors, officers, employees, agents,
representative, attorneys, consultants and advisors of or to any of the
foregoing (including those retained in connection with the satisfaction or
attempted satisfaction of any condition set forth in Article III (each such
Person being an "INDEMNITEE") from and against any and all claims, damages,
liabilities, obligations, losses, penalties, actions, judgments, suits, costs,
disbursements and expenses of any kind or nature (including fees, disbursements
and expenses of financial and legal advisors to any such Indemnitee) that may be
imposed on, incurred by or asserted against any such Indemnitee in connection
with or arising out of any investigation, litigation or proceeding, whether or
not any such Indemnitee is a party thereto, whether direct, indirect, or
consequential and whether based on any federal, state or local law or other
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statutory regulation, securities or commercial law or regulation, or under
common law or in equity, or on contract, tort or otherwise, in any manner
relating to or arising out of this Agreement, any other Loan Document, any
Obligation, any Letter of Credit, the Disclosure Document, the Revolving Credit
Notes or any act, event or transaction related or attendant to any thereof, or
the use or intended use of the proceeds of the Loans or Letters of Credit or in
connection with any investigation of any potential matter covered hereby
(collectively, the "INDEMNIFIED MATTERS"); PROVIDED, HOWEVER, that the Borrower
shall not have any obligation under this Section 10.4 to an Indemnitee with
respect to any Indemnified Matter caused by or resulting from the gross
negligence or willful misconduct of that Indemnitee, as determined by a court of
competent jurisdiction in a final non-appealable judgment or order. Without
limiting the foregoing, Indemnified Matters include (i) all environmental
liabilities and costs arising from or connected with the past, present or future
operations of the Borrower or any of its Subsidiaries or damage to real or
personal property or natural resources or harm or injury alleged to have
resulted from any Release of Contaminants; (ii) any costs or liabilities
incurred in connection with any Remedial Action concerning any Borrower or any
of its Subsidiaries; (iii) any costs or liabilities incurred in connection with
any Environmental Lien and (iv) any costs or liabilities incurred in connection
with any other matter under any Environmental Law, including the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (49 U.S.C. 9601
ET SEQ.) and applicable state property transfer laws, except, with respect to
those matters referred to in clauses (i), (ii), (iii) and (iv) above, to the
extent attributable to acts of the Administrative Agent, such Lender or such
Issuer or any agent on behalf of the Administrative Agent, such lender or such
Issuer. In the case of an investigation, litigation or other proceeding to which
the indemnity in this Section 10.4 applies, such indemnity shall be effective
whether or not such investigation, litigation or proceeding is brought by the
Borrower, any of its directors, securityholders or creditors, an Indemnitee or
any other person, or an Indemnitee is otherwise a party thereto and whether or
not the transactions contemplated hereby are consummated.
(b) The Borrower shall indemnify the Administrative Agent, the
Lenders and each Issuer for, and hold the Administrative Agent, the Lenders and
each Issuer harmless from and against, any and all claims for brokerage
commissions, fees and other compensation made against the Administrative Agent,
the Lenders and the Issuers for any broker, finder or consultant with respect to
any agreement, arrangement or understanding made by or on behalf of any Loan
Party or any of its Subsidiaries in connection with the transactions
contemplated by this Agreement.
(c) The Borrower, at the request of any Indemnitee, shall have
the obligation to defend against such investigation, litigation or proceeding or
requested Remedial Action and the Borrower, in any event, may participate in the
defense thereof with legal counsel of the Borrower's choice. In the event that
such Indemnitee requests the Borrower to defend against such investigation,
litigation or proceeding or requested Remedial Action, the Borrower shall
promptly do so and such Indemnitee shall have the right to have legal counsel of
its choice participate in such defense. No action taken by legal counsel chosen
by such Indemnitee in defending against any such investigation, litigation or
proceeding or requested Remedial Action, shall vitiate or in any way impair the
Borrower's obligation and duty hereunder to indemnify and hold harmless such
Indemnitee.
(d) The Borrower agrees that any indemnification or other
protection provided to any Indemnitee pursuant to this Agreement (including
pursuant to this Section 10.4) or any other Loan Document shall (i) survive
payment in full of the Obligations and (ii) inure to the benefit of any Person
that was at any time an Indemnitee under this Agreement or any other Loan
Document.
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SECTION 10.5 LIMITATION OF LIABILITY.
The Borrower agrees that no Indemnitee shall have any
liability (whether in contract, tort or otherwise) to any Loan Party or any of
their respective Subsidiaries or any of their respective equity holders or
creditors for or in connection with the transactions contemplated hereby and in
the other Loan Documents, except for direct damages (as opposed to special,
indirect, consequential or punitive damages (including, without limitation, any
loss of profits, business or anticipated savings)) determined in a final
non-appealable judgment by a court of competent jurisdiction to have resulted
from such Indemnitee's gross negligence or willful misconduct. The Borrower
hereby waives, releases and agrees (each for itself and on behalf of its
Subsidiaries) not to ▇▇▇ upon any such claim for any special, indirect,
consequential or punitive damages, whether or not accrued and whether or not
known or suspected to exist in its favor.
SECTION 10.6 RIGHT OF SET-OFF.
Upon the occurrence and during the continuance of any Event of
Default each Lender and each Affiliate of a Lender is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender or its Affiliates to or for the credit or the account of the Borrower
against any and all of the Obligations now or hereafter existing whether or not
such Lender shall have made any demand under this Agreement or any other Loan
Document and even though such Obligations may be unmatured. Each Lender agrees
promptly to notify the Borrower after any such set-off and application made by
such Lender or its Affiliates; PROVIDED, HOWEVER, that the failure to give such
notice shall not affect the validity of such set-off and application. The rights
of each Lender under this Section 10.6 are in addition to the other rights and
remedies (including other rights of set-off) that such Lender may have.
SECTION 10.7 SHARING OF PAYMENTS, ETC.
(a) If any Lender obtains any payment (whether voluntary,
involuntary, through the exercise of any right of set-off or otherwise) of the
Loans owing to it, any interest thereon, fees in respect thereof or amounts due
pursuant to Section 10.3 or Section 10.4 (other than payments pursuant to
Section 2.14, Section 2.15 or Section 2.16 in excess of its Ratable Portion of
all payments of such Obligations obtained by all the Lenders, such Lender (a
"PURCHASING LENDER") shall forthwith purchase from the other Lenders (each, a
"SELLING LENDER") such participations in their Loans or other Obligations as
shall be necessary to cause such Purchasing Lender to share the excess payment
ratably with each of them.
(b) If all or any portion of any payment received by a
Purchasing Lender is thereafter recovered from such Purchasing Lender, such
purchase from each Selling Lender shall be rescinded and such Selling Lender
shall repay to the Purchasing Lender the purchase price to the extent of such
recovery together with an amount equal to such Selling Lender's ratable share
(according to the proportion of (i) the amount of such Selling Lender's required
repayment in relation to (ii) the total amount so recovered from the Purchasing
Lender) of any interest or other amount paid or payable by the Purchasing Lender
in respect of the total amount so recovered.
(c) The Borrower agrees that any Purchasing Lender so
purchasing a participation from a Selling Lender pursuant to this Section 10.7
may, to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of the Borrower in the amount of such
participation.
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SECTION 10.8 NOTICES, ETC.
All notices, demands, requests and other communications
provided for in this Agreement shall be given in writing, or by any
telecommunication device capable of creating a written record (including
electronic mail), and addressed to the party to be notified as follows:
(a) if to the Borrower:
TECHNICAL OLYMPIC USA, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Chief Financial Officer
Telecopy no: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
with a copy to:
TECHNICAL OLYMPIC USA, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.,
General Counsel
Telecopy no: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
(b) if to any Lender, at its Domestic Lending Office specified
opposite its name on SCHEDULE II or on the signature page of any applicable
Assignment and Acceptance;
(c) if to any Issuer, at the address set forth under its
name on SCHEDULE II; and
(d) if to the Administrative Agent or the Swing Loan
Lender:
CITICORP NORTH AMERICA, INC.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telecopy no: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopy no: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
or at such other address as shall be notified in writing (i) in the case of the
Borrower, the Administrative Agent and the Swing Loan Lender to the other
parties and (y) in the case of all other parties, to the Borrower and the
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Administrative Agent. All such notices and communications shall be effective
upon personal delivery (if delivered by hand, including any overnight courier
service), when deposited in the mails (if sent by mail), or when properly
transmitted (if sent by a telecommunications device or through the Internet);
PROVIDED, HOWEVER, that notices and communications to the Administrative Agent
pursuant to Article II or IX shall not be effective until received by the
Administrative Agent.
SECTION 10.9 NO WAIVER; REMEDIES.
No failure on the part of any Lender, Issuer or the
Administrative Agent to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 10.10 BINDING EFFECT.
This Agreement shall become effective when it shall have been
executed by the Borrower and the Administrative Agent and when the
Administrative Agent shall have been notified by each Lender and Issuer that
such Lender or Issuer has executed it and thereafter shall be binding upon and
inure to the benefit of the Borrower, the Administrative Agent and each Lender
and Issuer and, in each case, their respective successors and assigns, PROVIDED,
HOWEVER, that the Borrower shall not have the right to assign its rights
hereunder or any interest herein without the prior written consent of the
Lenders.
SECTION 10.11 GOVERNING LAW.
This Agreement and the rights and obligations of the parties
hereto shall be governed by, and construed and interpreted in accordance with,
the law of the State of New York.
SECTION 10.12 SUBMISSION TO JURISDICTION; SERVICE OF PROCESS.
(a) Any legal action or proceeding with respect to this
Agreement or any other Loan Document may be brought in the courts of the State
of New York sitting in the City of New York or of the United States of America
for the Southern District of New York, and, by execution and delivery of this
Agreement, the Borrower hereby accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts. The parties hereto hereby irrevocably waive any objection, including any
objection to the laying of venue or based on the grounds of FORUM NON
CONVENIENS, that any of them may now or hereafter have to the bringing of any
such action or proceeding in such respective jurisdictions.
(b) The Borrower irrevocably consents to the service of any
and all process in such action or proceeding arising out of or in connection
with this Agreement or any Loan Document by the mailing (by registered or
certified mail, postage prepaid) of copies of such process to an appointed
process agent or the Borrower at its address specified in Section 10.8. The
Borrower agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law.
(c) Nothing contained in this Section 10.12 shall affect the
right of the Administrative Agent or any Lender to serve process in any other
manner permitted by law or commence legal proceedings or otherwise proceed
against the Borrower or any other Loan Party in any other jurisdiction.
(d) If for the purposes of obtaining judgment in any court it
is necessary to convert a sum due hereunder in Dollars into another currency,
the parties hereto agree, to the fullest extent that they may effectively do so,
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that the rate of exchange used shall be that at which in accordance with normal
banking procedures the Administrative Agent could purchase Dollars with such
other currency at the spot rate of exchange quoted by the Administrative Agent
at 11:00 a.m. (New York time) on the Business Day preceding that on which final
judgment is given, for the purchase of Dollars, for delivery two Business Days
thereafter.
SECTION 10.13 WAIVER OF JURY TRIAL.
EACH OF THE ADMINISTRATIVE AGENT, THE LENDERS, THE ISSUERS AND
THE BORROWER IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH
RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT.
SECTION 10.14 SECTION TITLES.
The section titles contained in this Agreement are and shall
be without substantive meaning or content of any kind whatsoever and are not a
part of the agreement between the parties hereto, except when used to reference
a section. Any reference to the number of a clause, sub-clause or subsection
hereof immediately followed by a reference in parenthesis to the title of the
Section containing such clause, sub-clause or subsection is a reference to such
clause, sub-clause or subsection and not to the entire Section; PROVIDED,
HOWEVER, that, in case of direct conflict between the reference to the title and
the reference to the number of such Section, the reference to the title shall
govern absent manifest error. If any reference to the number of a Section (but
not to any clause, sub-clause or subsection thereof) is followed immediately by
a reference in parenthesis to the title of a Section, the title reference shall
govern in case of direct conflict absent manifest error.
SECTION 10.15 EXECUTION IN COUNTERPARTS.
This Agreement may be executed in any number of counterparts
and by different parties in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement. Signature pages may be detached from
multiple separate counterparts and attached to a single counterpart so that all
signature pages are attached to the same document. Delivery of an executed
signature page of this Agreement by facsimile transmission shall be as effective
as delivery of a manually executed counterpart hereof. A set of the copies of
this Agreement signed by all parties shall be lodged with the Borrower and the
Administrative Agent.
SECTION 10.16 ENTIRE AGREEMENT.
This Agreement, together with all of the other Loan Documents
and all certificates and documents delivered hereunder or thereunder, embodies
the entire agreement of the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof.
SECTION 10.17 CONFIDENTIALITY.
(a) None of the Administrative Agent or any Lender may
disclose to any Person any confidential, proprietary or non-public information
of the Borrower and its Subsidiaries furnished to the Administrative Agent or
the Lenders by the Borrower (such information being referred to collectively
herein as the "BORROWER INFORMATION"), except that the Administrative Agent and
each of the Lenders may disclose Borrower Information (i) to its and its
Affiliates' employees, officers, directors, agents and advisors on a need to
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know basis (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such Borrower Information and
instructed to keep such Borrower Information confidential on substantially the
same terms as provided herein), (ii) to the extent requested by any regulatory
authority, (iii) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (iv) to any other party to this
Agreement, (v) if reasonably necessary in connection with the exercise of any
remedies hereunder or under any other Loan Document or any suit, action or
proceeding relating to this Agreement or any other Loan Document or the
enforcement of rights hereunder or thereunder, (vi) subject to an agreement
containing provisions substantially the same as those of this Section 10.17, to
any assignee of or participant in, or any prospective assignee of or participant
in, any of its rights or obligations under this Agreement, (vii) to the extent
such Borrower Information (A) is or becomes generally available to the public on
a non-confidential basis other than as a result of a breach of this Section
10.17 by the Administrative Agent or such Lender, or (B) is or becomes available
to such Agent or such Lender on a nonconfidential basis from a source other than
the Borrower and (viii) with the prior written consent of the Borrower.
(b) The Borrower may not disclose to any Person the amount or
terms of any fees payable to the Administrative Agent, the Arrangers or any
Lender (such information being collectively referred to herein as the "FACILITY
INFORMATION"), except that the Borrower may disclose the Facility Information
(i) to its and its respective Affiliates' employees, officers, directors, agents
and advisors who have a need to know the Facility Information in connection with
this Agreement and the transactions contemplated hereby or (ii) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process.
SECTION 10.18 USA PATRIOT ACT.
Each Lender hereby notifies each Loan Party that pursuant to
the requirements of the USA Patriot Act, it is required to obtain, verify and
record information that identifies Loan Parties, which information includes the
name and address of each Loan Party and other information that will allow the
Lenders to identify such Loan Party in accordance with the USA Patriot Act.
SECTION 10.19 AGENT COMMUNICATIONS.
(a) Each Loan Party hereby agrees that it will provide to the
Administrative Agent all information, documents and other materials that it is
obligated to furnish to the Administrative Agent pursuant to the Loan Documents,
including, without limitation, all notices, requests, financial statements,
financial and other reports, certificates and other information material, but
excluding any such communication that (i) relates to a request for a new, or a
conversion of an existing, Borrowing or other extension of credit (including any
election of an interest rate or interest period relating thereto), (ii) relates
to the payment of any principal or other amount due under this Agreement prior
to the scheduled date therefore, (iii) provides notice of any Default under this
Agreement or (iv) is required to be delivered to satisfy any condition precedent
to the effectiveness of this Agreement an/or any borrowing or other extension of
credit hereunder (all such non-excluded communications being referred to herein
collectively as "COMMUNICATIONS"), by transmitting the Communications in an
electronic/soft medium in a format acceptable to the Administrative Agent to
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇. In addition, each Loan Party agrees to continue
to provide the Communications to the Administrative Agent in the manner
specified in the Loan Documents but only to the extent requested by the
Administrative Agent.
(b) Each Loan Party further agrees that the Administrative
Agent may make the Communications available to the Lenders by posting the
Communications on Intralinks (the "PLATFORM"). Each Loan Party acknowledges that
the distribution of material through an electronic medium is not necessarily
secure and that there are confidentiality and other risks associated with such
distribution.
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(c) THE PLATFORM IS PROVIDED "AS IS" "AS AVAILABLE". THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
COMMUNICATIONS, OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM LIABILITY
FOR ERRORS OR OMISSIONS IN THE COMMUNICATIONS. NO WARRANTY OF ANY KIND, EXPRESS,
IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF
THIRD-PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS IS MADE BY THE
AGENT PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE PLATFORM. IN NO EVENT
SHALL THE ADMINISTRATIVE AGENT OR ANY OF ITS AFFILIATES OR ANY OF THEIR
RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES
(COLLECTIVELY, "AGENT PARTIES") HAVE ANY LIABILITY TO THE LOAN PARTIES, ANY
LENDER OR ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING, WITHOUT
LIMITATION, DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF THE
LOAN PARTIES' OR THE ADMINISTRATIVE AGENT'S TRANSMISSION OF COMMUNICATIONS
THROUGH THE INTERNET, EXCEPT TO THE EXTENT THE LIABILITY OF ANY AGENT PARTY IS
FOUND IN A FINAL, NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION
TO HAVE RESULTED PRIMARILY FROM SUCH AGENT PARTY'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT.
(d) The Administrative Agent agrees that the receipt of the
Communications by the Agent at its e-mail address set forth above shall
constitute effective delivery of the Communications to the Agent for purposes of
the Loan Documents. Each Lender agrees that notice to it (as provided in the
next sentence) specifying that the Communications have been posted to the
Platform shall constitute effective delivery of the Communications to such
Lender for purposes of the Loan Documents. Each Lender agrees to notify the
Administrative Agent in writing (including by electronic communication) from
time to time of such Lender's e-mail address to which the foregoing notice may
be sent by electronic transmission and (ii) that the foregoing notice may be
sent to such e-mail address.
(e) Nothing herein shall prejudice the right of the
Administrative Agent or any Lender to give any notice or other communication
pursuant to any Loan Document in any other manner specified in such Loan
Document.
[SIGNATURE PAGES FOLLOW]
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TECHNICAL OLYMPIC USA, INC.,
as Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Sr. Vice President,
Chief Financial Officer and
Treasurer
CITIGROUP GLOBAL MARKETS INC.
as Joint Lead Arranger and Joint
Bank Manager
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Director
CITICORP NORTH AMERICA, INC.
as Administrative Agent and Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
DEUTSCHE BANK SECURITIES INC.,
as Joint Lead Arranger and Joint
Book Manager and Syndication Agent
By: /s/ ▇▇▇▇▇ ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Vice President
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Vice President
Technical Olympic USA, Inc.
Credit Agreement
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KEYBANK NATIONAL ASSOCIATION,
as Co-Documentation Agent and Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.,
as Co-Documentation Agent
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Associate
JPMORGAN CHASE BANK,
as Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
BANK OF AMERICA, N.A., AS LENDER
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
BANK OF THE WEST
By /s/ ▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, CFA
Title: Vice President
Technical Olympic USA, Inc.
Credit Agreement
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BRANCH BANKING AND TRUST COMPANY,
AS LENDER
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
CALYON NEW YORK BRANCH, AS LENDER
By: /s/ ATTILA COACH
-----------------------------------
Name: Attila Coach
Title: Senior Vice President
AND
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
COMERICA BANK, AS LENDER
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
COMPASS BANK, AN ALABAMA BANKING
CORPORATION, AS LENDER
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Title: Senior Vice President
GUARANTY, AS LENDER
By: /s/ ▇▇▇▇▇ ▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Senior Vice President
Technical Olympic USA, Inc.
Credit Agreement
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NATIONAL CITY BANK, AS LENDER
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION, AS
LENDER
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Vice President
SOVEREIGN BANK, AS LENDER
By: /s/ T. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Name: T. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
WASHINGTON MUTUAL BANK FA, AS LENDER
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
WACHOVIA BANK, N.A.
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
Technical Olympic USA, Inc.
Credit Agreement
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