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AMENDED AND RESTATED
CREDIT AGREEMENT
Among
CASTLE & XXXXX, INC.,
as Borrower
THE LENDERS LISTED HEREIN,
as Lenders
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION; XXXXX FARGO BANK, NATIONAL
ASSOCIATION; BANK OF HAWAII; THE FIRST NATIONAL
BANK OF CHICAGO; AND SOCIETE GENERALE,
as Co-Agents
and
THE CHASE MANHATTAN BANK,
as Agent, Administration Agent
and Collateral Agent
Dated as of May 16, 1997
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TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.01. Defined Terms. . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.02. Terms Generally. . . . . . . . . . . . . . . . . . . . . 22
ARTICLE II. THE CREDITS . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.01. Commitments. . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.02. Loans. . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.03. Borrowing Procedure. . . . . . . . . . . . . . . . . . . 30
SECTION 2.04. Evidence of Debt; Repayment of
Loans. . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.05. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 2.06. Interest on Loans. . . . . . . . . . . . . . . . . . . . 33
SECTION 2.07. Default Interest . . . . . . . . . . . . . . . . . . . . 34
SECTION 2.08. Alternate Rate of Interest . . . . . . . . . . . . . . . 35
SECTION 2.09. Termination and Reduction of
Commitments; Increase and Reduction of
Borrowing Base; Release of Liens . . . . . . . . . . . . . . . . . 35
SECTION 2.10. Conversion and Continuation of
Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 2.11. Prepayment . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 2.12. Reserve Requirements; Change in
Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 2.13. Change in Legality . . . . . . . . . . . . . . . . . . . 43
SECTION 2.14. Indemnity. . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 2.15. Pro Rata Treatment . . . . . . . . . . . . . . . . . . . 45
SECTION 2.16. Sharing of Setoffs . . . . . . . . . . . . . . . . . . . 45
SECTION 2.17. Payments . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 2.18. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 2.19. Assignment of Commitments Under
Certain Circumstances; Duty to
Mitigate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 2.20. Letters of Credit. . . . . . . . . . . . . . . . . . . . 52
ARTICLE III. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . 58
SECTION 3.01. Organization; Powers . . . . . . . . . . . . . . . . . . 58
SECTION 3.02. Authorization. . . . . . . . . . . . . . . . . . . . . . 58
SECTION 3.03. Enforceability . . . . . . . . . . . . . . . . . . . . . 59
SECTION 3.04. Governmental Approvals . . . . . . . . . . . . . . . . . 59
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SECTION 3.05. Financial Statements . . . . . . . . . . . . . . . . . . 59
SECTION 3.06. No Material Adverse Change . . . . . . . . . . . . . . . 59
SECTION 3.07. Title to Properties; Possession
Under Leases . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 3.08. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 3.09. Litigation; Compliance with Laws . . . . . . . . . . . . 60
SECTION 3.10. Agreements . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 3.11. Federal Reserve Regulations. . . . . . . . . . . . . . . 61
SECTION 3.12. Investment Company Act; Public
Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . 61
SECTION 3.13. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . 62
SECTION 3.14. Tax Returns . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 3.15. No Material Misstatements . . . . . . . . . . . . . . . . 62
SECTION 3.16. Employee Benefit Plans. . . . . . . . . . . . . . . . . . 62
SECTION 3.17. Environmental Matters . . . . . . . . . . . . . . . . . . 63
SECTION 3.18. Insurance . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 3.19. Security Documents. . . . . . . . . . . . . . . . . . . . 64
SECTION 3.20. Labor Matters . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 3.21. Solvency. . . . . . . . . . . . . . . . . . . . . . . . . 65
ARTICLE IV. CONDITIONS OF LENDING. . . . . . . . . . . . . . . . . . . . . . 66
SECTION 4.01. All Credit Events . . . . . . . . . . . . . . . . . . . . 66
SECTION 4.02. Effectiveness . . . . . . . . . . . . . . . . . . . . . . 67
ARTICLE V. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 5.01. Existence; Businesses and
Properties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 5.02. Insurance . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 5.03. Obligations and Taxes . . . . . . . . . . . . . . . . . . 76
SECTION 5.04. Financial Statements, Reports, etc. . . . . . . . . . . . 76
SECTION 5.05. Litigation and Other Notices. . . . . . . . . . . . . . . 79
SECTION 5.06. Employee Benefits . . . . . . . . . . . . . . . . . . . . 79
SECTION 5.07. Maintaining Records; Access to
Properties and Inspections. . . . . . . . . . . . . . . . . . . . . 79
SECTION 5.08. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . 80
SECTION 5.09. Compliance with Environmental Laws. . . . . . . . . . . . 80
SECTION 5.10. (a) Preparation of Environmental
Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 5.11. Further Assurances. . . . . . . . . . . . . . . . . . . . 81
ARTICLE VI. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 6.01. Indebtedness. . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 6.02. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . 83
SECTION 6.03. Sale and Lease-Back Transactions. . . . . . . . . . . . . 85
SECTION 6.04. Investments . . . . . . . . . . . . . . . . . . . . . . . 85
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SECTION 6.05. Mergers, Consolidations, Sales of
Assets and Acquisitions . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 6.06. Dividends and Distributions;
Restrictions on Ability of
Subsidiaries to Pay Dividends . . . . . . . . . . . . . . . . . . . 87
SECTION 6.07. Transactions with Affiliates. . . . . . . . . . . . . . . 87
SECTION 6.08. Payments in Respect of Permitted
Third Party Debt. . . . . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 6.09. Issuances of Capital Stock. . . . . . . . . . . . . . . . 88
SECTION 6.10. Term Note . . . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 6.11. Amendments of Certain Agreements. . . . . . . . . . . . . 88
SECTION 6.12. Tangible Net Worth. . . . . . . . . . . . . . . . . . . . 88
SECTION 6.13. Interest Coverage Ratio . . . . . . . . . . . . . . . . . 89
SECTION 6.14. Cash Flow Ratio . . . . . . . . . . . . . . . . . . . . . 89
SECTION 6.15. Certain Inventory . . . . . . . . . . . . . . . . . . . . 89
ARTICLE VII. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . 90
ARTICLE VIII. THE ADMINISTRATIVE AGENT . . . . . . . . . . . . . . . . . . . 94
ARTICLE IX. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . 97
SECTION 9.01. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 97
SECTION 9.02. Survival of Agreement . . . . . . . . . . . . . . . . . . 98
SECTION 9.03. Binding Effect. . . . . . . . . . . . . . . . . . . . . . 99
SECTION 9.04. Successors and Assigns. . . . . . . . . . . . . . . . . . 99
SECTION 9.05. Expenses; Indemnity. . . . . . . . . . . . . . . . . . . 103
SECTION 9.06. Right of Setoff. . . . . . . . . . . . . . . . . . . . . 105
SECTION 9.07. Applicable Law . . . . . . . . . . . . . . . . . . . . . 105
SECTION 9.08. Waivers; Amendment . . . . . . . . . . . . . . . . . . . 106
SECTION 9.09. Interest Rate Limitation . . . . . . . . . . . . . . . . 107
SECTION 9.10. Entire Agreement . . . . . . . . . . . . . . . . . . . . 107
SECTION 9.11. WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . . . 108
SECTION 9.12. Severability . . . . . . . . . . . . . . . . . . . . . . 108
SECTION 9.13. Counterparts . . . . . . . . . . . . . . . . . . . . . . 108
SECTION 9.14. Headings . . . . . . . . . . . . . . . . . . . . . . . . 108
SECTION 9.15. Jurisdiction; Consent to Service of
Process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
SECTION 9.16. Confidentiality. . . . . . . . . . . . . . . . . . . . . 109
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SCHEDULE 1.01(a) Additional Mortgaged Properties
SCHEDULE 1.01(b) Guarantors
SCHEDULE 1.01(c) Mortgaged Properties
SCHEDULE 1.01(d) Material Subsidiaries
SCHEDULE 2.01 Lenders/Commitments
SCHEDULE 3.07(c) Condemnation Proceedings
SCHEDULE 3.07(d) Rights of First Refusal, etc.
SCHEDULE 3.08 Subsidiaries
SCHEDULE 3.09 Litigation
SCHEDULE 3.17 Environmental Matters
SCHEDULE 3.18 Insurance
SCHEDULE 4.02(a) Local Counsel
SCHEDULE 4.02(h) Security Documents
SCHEDULE 4.02(s) Certain Existence Indebtedness
SCHEDULE 6.02 Liens
SCHEDULE 6.11 Material Agreements
EXHIBIT A Form of Administrative Questionnaire
EXHIBIT B Form of Assignment and Acceptance
EXHIBIT C Form of Borrowing Request
EXHIBIT D Form of Omnibus Amendment
EXHIBIT E Form of [Mortgage/Deed of Trust],
Assignment of Leases and Rents,
Security Agreement and Financing
Statement
EXHIBIT F Form of Borrowing Base Certificate
EXHIBIT G-1 Form of Opinion of O'Melveny &
Xxxxxx
EXHIBIT G-2 Form of Opinion of Goodsill,
Anderson, Xxxxx & Stifel
EXHIBIT G-3 Form of Local Counsel Opinion
EXHIBIT H Form of Financial Covenants
Compliance Certificate
iv
AMENDED AND RESTATED CREDIT AGREEMENT dated as of May 16,
1997, among CASTLE & XXXXX, INC., a Hawaii corporation (the
"BORROWER"), the Lenders (as defined in Article I), the Co-Agents
(as defined in Article I), and THE CHASE MANHATTAN BANK (formerly
known as Chemical Bank), a New York banking corporation, as agent
(in such capacity, the "Agent"), administrative agent (in such
capacity, the "ADMINISTRATIVE AGENT") and collateral agent (in
such capacity, the "COLLATERAL AGENT") for the Lenders.
The Borrower and the Lenders (such term and each other capitalized
term used herein having the meaning set forth in Article I hereof), the
Administrative Agent and the Collateral Agent are parties to a Credit
Agreement dated as of December 27, 1995, as amended by a First Amendment
dated as of August 2, 1996, by a Second Amendment dated as of March 1, 1997,
and a Third Amendment dated as of March 31, 1997, and in effect prior to the
effectiveness of this Agreement (the "ORIGINAL CREDIT AGREEMENT"). The
Borrower has requested that the Lenders, the Administrative Agent and the
Collateral Agent agree to amend and restate the Original Credit Agreement in
order to amend certain provisions therein. The Lenders, the Administrative
Agent and the Collateral Agent are willing to agree to such amendment and
restatement in its entirety of the Original Credit Agreement, subject to the
terms and conditions hereinafter set forth.
The Borrower has requested the Lenders to extend credit in the form
of Loans at any time and from time to time prior to the Maturity Date, in an
aggregate principal amount at any time outstanding not in excess of
$250,000,000 (inclusive of L/C Exposure), subject to the limitations set
forth in this Agreement. The Borrower has also requested the Issuing Bank to
issue Letters of Credit, the L/C Exposure of which at any time is not to
exceed $10,000,000, subject to the limitations set forth in this Agreement.
The proceeds of the Loans, and such Letters of Credit, are to be used solely
for general corporate purposes in the ordinary course of the Borrower's
business.
The Lenders are willing to extend such credit to the Borrower and
the Issuing Bank is willing to issue Letters of Credit for the account of the
Borrower on the terms and subject to the conditions set forth herein.
Accordingly, the parties hereto agree as follows:
ARTICLE I. DEFINITIONS
SECTION 1.01. DEFINED TERMS. As used in this Agreement, the
following terms shall have the meanings specified below:
"ABR BORROWING" shall mean a Borrowing comprised of ABR Loans.
"ABR LOAN" shall mean any Loan bearing interest at the Alternate
Base Rate in accordance with the provisions of Article II.
"ADDITIONAL MORTGAGED PROPERTIES" shall mean, at any date, any
Income Producing Property against which the Borrower or any Guarantor shall
have granted the Collateral Agent a first mortgage, subject to and in
accordance with the terms and conditions specified in Schedule 1.01(a), at
any time after the Closing Date; PROVIDED that for purposes of computing the
Borrowing Base, any increase in the Allocated Loan Value of the property
known as the Xxxx Cannery Commercial Development arising from the exercise of
the expansion option by HGI Realty, Inc. shall be treated as an Additional
Mortgaged Property. A property shall cease to be an Additional Mortgaged
Property upon the sale of such property or upon the release of the Lien of
the Mortgage thereon. The Additional Mortgaged Properties shall not include
the New Mortgaged Properties.
"ADJUSTED LIBO RATE" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the product of (a)
the LIBO Rate in effect for such Interest Period and (b) Statutory Reserves.
"ADMINISTRATIVE AGENT FEES" shall have the meaning assigned to such
term in Section 2.05(b).
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an Administrative
Questionnaire in the form of Exhibit A.
2
"AFFILIATE" shall mean, when used with respect to a specified
person, another person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled by or is under common Control with
the person specified.
"AGGREGATE REVOLVING CREDIT EXPOSURE" shall mean the aggregate
amount of the Lenders' Revolving Credit Exposures.
"AGREEMENT" shall mean this Amended and Restated Credit Agreement.
"ALLOCATED LOAN VALUE" shall mean, (a) as to any Mortgaged
Property, the amount specified in Schedule 1.01(c) under the heading
"Allocated Loan Value" opposite the reference to such Mortgaged Property and
(b) as to any Additional Mortgaged Property, an amount equal to 60% of the
appraised value of such Additional Mortgaged Property, as shown in the
written appraisal report delivered to the Lenders pursuant to paragraph (c)
of Schedule 1.01(a). With respect to any Additional Mortgaged Property, the
Required Lenders shall have the right, each acting in its sole discretion, to
approve or disapprove (i) the estimated value within each written appraisal
report required pursuant to said paragraph (c) of Schedule 1.01(a) and (ii) a
Phase I environmental report relating to such Additional Mortgaged Property.
Approval or disapproval thereof shall be given by each Lender within fifteen
(15) Business Days of receipt by such Lender of the applicable written
appraisal and the Phase I environmental report from the Administrative Agent;
PROVIDED HOWEVER that if a Lender fails to respond to the Administrative
Agent within such fifteen (15) Business Day period, the estimated value
within such written appraisal report and the Phase I environmental report
shall be deemed approved by such Lender. On or prior to the Closing Date the
Administrative Agent shall complete Schedule 1.01(c) to reflect an aggregate
Allocated Loan Value for all the Mortgaged Properties equal to 60% of the
aggregate appraised value of the Mortgaged Properties; and such aggregate
Allocated Loan Value shall be allocated on Schedule 1.01(c) among each of the
Mortgaged Properties on a PRO rata basis, based on its share of such
aggregate total appraised value. If at any time and from time to time the
Required Lenders, each acting in its sole discretion, believe that the value
of any one or more Mortgaged Properties has significantly decreased, then the
Required Lenders, by written notice to the Borrower, have the right to have
such Mortgaged Property
3
or Properties reappraised, at the Borrower's cost and expense, in which event
the Allocated Loan Value of any such reappraised Mortgaged Property or
Properties shall be adjusted based upon such reappraisal as follows: If any
Mortgaged Property shall be so reappraised, the Required Lenders shall have
the right, each acting in its sole discretion, to approve or dissapprove the
estimated value within the written appraisal report prepared in connection
with such reappraisal, which reappraisal shall be performed in accordance
with the same requirements as apply to written appraisal reports for
Additional Mortgaged Properties. Approval or disapproval thereof shall be
given by each Lender within fifteen (15) Business Days of receipt by such
Lender of the applicable written appraisal from the Administrative Agent;
PROVIDED however that if a Lender fails to respond to the Administrative
Agent within such fifteen (15) Business Day period, the estimated value
within such written appraisal report shall be deemed approved by such Lender.
In the event of any such reappraisal, the Borrower shall deliver to the
Administrative Agent a new Borrowing Base Certificate reflecting the approved
reappraised value and a new Total Indebtedness Certificate within five (5)
Business Days of the date of the approval, the estimated value of any such
reappraisal is approved. The Required Lenders may not have the same
Mortgaged Property so reappraised more than once during any consecutive
eighteen (18) month period, except the Required Lenders may reappraise the
Xxxx Cannery Commercial Development more frequently than once during any
consecutive eighteen (18) month period, but not more than twice during the
period from and after the date hereof through and including the Maturity
Date.
"ALLOCATION AGREEMENT" shall mean the Allocation Agreement between
Dole and the Borrower, in the form attached as an exhibit to the Form 10.
"ALTERNATE BASE RATE" shall mean, for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/100 of 1%) equal to the greater
of (a) the Prime Rate in effect on such day and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Effective Rate for any reason, including the inability or failure of
the Administrative Agent to obtain sufficient quotations in accordance with
the terms of the definition thereof, the
4
Alternate Base Rate shall be determined without regard to clause (b) of the
preceding sentence, until the circumstances giving rise to such inability no
longer exist. Any change in the Alternate Base Rate due to a change in the
Prime Rate or the Federal Funds Effective Rate shall be effective on the
effective date of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively. The term "PRIME RATE" shall mean the rate of
interest per annum publicly announced from time to time by the Administrative
Agent as its prime rate in effect at its principal office in New York City;
each change in the Prime Rate shall be effective on the date such change is
publicly announced as being effective. The term "FEDERAL FUNDS EFFECTIVE
RATE" shall mean, for any day, 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 on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day that is a Business Day, the average of the
quotations for the day for such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.
"APPLICABLE PERCENTAGE" shall mean, with respect to any Lender, such
Lender's pro rata share, expressed as a percentage, of the Total Commitment,
which percentage for each Lender is set forth on Schedule 2.01.
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by a Lender and an assignee, and accepted by the Administrative
Agent, in the form of Exhibit B or such other form as shall be approved by the
Administrative Agent.
"BENEFITS AGREEMENT" shall mean the Employee Benefits and Compensation
Allocation Agreement between Dole and the Borrower, in the form attached as an
exhibit to the Form 10.
"BOARD" shall mean the Board of Governors of the Federal Reserve
System of the United States of America.
"BORROWING" shall mean a group of Loans of a single Type made by the
Lenders on a single date and as to which a single Interest Period is in effect.
"BORROWING BASE" shall mean, at any date, with respect to the
Borrower, an amount equal to the sum of the
5
following (without duplication): (a) the Allocated Loan Value of the
Mortgaged Properties and the Additional Mortgaged Properties, plus (b) 35% of
Land Under Development at such date, plus (c) 75% of Unsold Homes/Lots and
Model Homes at such date, plus (d) 95% of Contracted Homes/Lots at such date.
The Borrowing Base shall be computed quarterly in accordance with Section
5.04(d), and shall also be computed in connection with each sale of Mortgaged
Property, Additional Mortgaged Property and in connection with certain other
sales in accordance with Section 2.09(b). The Borrowing Base at any time in
effect shall be determined by reference to the Borrowing Base Certificate
most recently delivered hereunder.
"BORROWING BASE CERTIFICATE" shall have the meaning assigned to
such term in Section 5.04(d).
"BORROWING REQUEST" shall mean a request by the Borrower in
accordance with the terms of Section 2.03 and substantially in the form of
Exhibit C.
"BUSINESS DAY" shall mean any day other than a Saturday, Sunday or
day on which banks in New York City or in Honolulu are authorized or required
by law to close; PROVIDED, HOWEVER, that when used in connection with a
Eurodollar Loan, the term "BUSINESS DAY" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.
"CAPITAL LEASE OBLIGATIONS" of any person shall mean the
obligations of such person to pay rent or other amounts under any lease of
(or other arrangement conveying the right to use) real or personal property,
or a combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"CASH FLOW RATIO" shall mean, for any period of four consecutive
fiscal quarters, the ratio of (a) the sum of (i) EBITDA for such period plus
(ii) Non-Cash Cost of Sales for such period, plus (iii) net cash proceeds of
property sales received during such period by the Borrower and its Subsidiaries
on a consolidated basis, to the extent not included within the computation of
EBITDA, less the amount of any permanent reduction in the Commitments resulting
from such sales, plus (iv) any net increase during
6
such period in the principal amount of the Loans outstanding hereunder as a
result of Borrowings to finance development and capital expenditures
referenced in item (b)(iv) below, over (b) the sum of (i) Interest Expense
for such period, plus (ii) dividends paid in cash by the Borrower during such
period, plus (iii) income taxes paid during such period by the Borrower and
its Subsidiaries on a consolidated basis, plus (iv) development and capital
expenditures paid during such period of the Borrower and its Subsidiaries on
a consolidated basis, except to the extent deducted in determining Net Income
for such period, plus (v) Investments made during such period by the Borrower
or its Subsidiaries on a consolidated basis.
A "CHANGE IN CONTROL" shall be deemed to have occurred if any
person or group (within the meaning of Rule 13d-5 of the Securities Exchange
Act of 1934 as in effect on the date hereof) other than Xxxxx X. Xxxxxxx or
an Affiliate of Xxxxx X. Xxxxxxx (including the estate of Xxxxx X. Xxxxxxx)
shall own directly or indirectly, beneficially or of record, shares
representing more than 50% of the aggregate ordinary voting power represented
by the issued and outstanding capital stock of the Borrower.
"CLOSING DATE" shall mean the date on which all of the conditions
in Section 4.02 have been satisfied.
"CO-AGENTS" shall mean, collectively, Bank of America National
Trust and Savings Association; Xxxxx Fargo Bank, National Association; Bank
of Hawaii; The First National Bank of Chicago; and Societe Generale.
"CODE" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
"COLLATERAL" shall mean all the "Collateral" as defined in any
Security Document and shall also include the Mortgaged Properties and any
Additional Mortgaged Properties.
"COMMITMENT" shall mean a Revolving Credit Commitment and/or an L/C
Commitment.
"COMMITMENT FEE" shall have the meaning assigned to such term in
Section 2.05(a).
"CONTRACTED HOMES/LOTS" shall mean, at any date, the consolidated
book value at such date of all homes and
7
homesites of the Borrower and its Subsidiaries owned as part of their
Homebuilding Business, on which construction has started, slab or foundation
has been completed and a written contract of sale has been entered into with
a buyer (other than the Borrower or any Subsidiary) as to which such buyer
has made an xxxxxxx money deposit.
"CONTROL" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
person, whether through the ownership of voting securities, by contract or
otherwise, and "CONTROLLING" and "CONTROLLED" shall have meanings correlative
thereto.
"CREDIT EVENT" shall have the meaning assigned to such term in
Section 4.01.
"DEFAULT" shall mean any event or condition which upon notice,
lapse of time or both would constitute an Event of Default.
"DEFAULT RATE" shall have the meaning assigned to such term in
Section 2.07.
"DISTRIBUTION" shall mean the distribution by Dole of shares of the
Borrower's common stock to Xxxx'x shareholders, as described in the Form 10.
"DOLE" shall mean Xxxx Food Company, Inc., a Hawaii corporation.
"DOLE PURCHASE AGREEMENT" shall mean the Purchase Agreement between
the Borrower and Dole and the other sellers party thereto in the form attached
as an exhibit to the Form 10.
"DOLLARS" or "$" shall mean lawful money of the United States of
America.
"DOMESTIC SUBSIDIARIES" shall mean all Subsidiaries incorporated or
organized under the laws of the United States of America, any State thereof
or the District of Columbia.
"EBITDA" shall mean, for any period, the sum, without duplication, of
(a) the Borrower's Net Income for such period, but excluding from the
determination of such Net Income any extraordinary or nonrecurring gains or
8
losses, plus (b) Federal, state and local income, franchise and other income
taxes deducted in determining such Net Income, plus (c) depreciation and
amortization deducted in determining such Net Income, plus (d) interest
expense deducted in determining such Net Income, plus (e) the amount of
previously capitalized interest expense which was expensed during such period
by the Borrower and its subsidiaries on a consolidated basis, to the extent
included within the cost of goods sold, less (f) the net income of any other
person that is accounted for by the Borrower by the equity method of
accounting, except to the extent of the amount of dividends or distributions
received by the Borrower.
"ELIGIBLE ASSIGNEE" shall mean (a) a commercial bank organized
under the laws of the United States of America, or any state thereof, and
having total assets in excess of $5,000,000,000; (b) a savings and loan
association or savings bank organized under the laws of the United States of
America, or any state thereof, and having a tangible net worth of at least
$250,000,000; (c) a commercial bank organized under the laws of any other
country which is a member of the Organization for Economic Cooperation and
Development ("OECD"), or a political subdivision of any such country, and
having total assets in excess of $10,000,000,000, provided that such bank is
acting through a branch or agency located in the United States of America;
(d) the central bank of any country which is a member of the OECD; (e) any
Lender or (f) any Affiliate of any Lender.
"ENVIRONMENT" shall mean ambient air, surface water and groundwater
(including potable water, navigable water and wetlands), the land surface or
subsurface strata, the workplace or as otherwise defined in any Environmental
Law.
"ENVIRONMENTAL CLAIM" shall mean any written accusation, allegation,
notice of violation, claim, demand, order, directive, cost recovery action or
other cause of action by, or on behalf of, any Governmental Authority or any
person for damages, injunctive or equitable relief, personal injury (including
sickness, disease or death), Remedial Action costs, tangible or intangible
property damage, natural resource damages, nuisance, pollution, any adverse
effect on the environment caused by any Hazardous Material, or for fines,
penalties or restrictions, resulting from or based upon: (a) the existence, or
the continuation
9
of the existence, of a Release (including sudden or non-sudden, accidental or
non-accidental Releases); (b) exposure to any Hazardous Material; (c) the
presence, use, handling, transportation, storage, treatment or disposal of
any Hazardous Materials; or (d) the violation or alleged violation of any
Environmental Law or Environmental Permit.
"ENVIRONMENTAL LAW" shall mean any and all applicable present and
future treaties, laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any
way to the environment, preservation or reclamation of natural resources, the
management, Release or threatened Release of any Hazardous Material or to
health and safety matters, including the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986, 42 U.S.C. Section 9601 ET SEQ.
(collectively "CERCLA"), the Solid Waste Disposal Act, as amended by the
Resource Conservation and Recovery Act of 1976 and Hazardous and Solid
Amendments of 1984, 42 U.S.C. Section 6901 ET SEQ., the Federal Water
Pollution Control Act, as amended by the Clean Water Act of 1977, 33 U.S.C.
Section 1251 ET SEQ., the Clean Air Act of 1970, as amended 42 U.S.C. Section
7401 ET SEQ., the Toxic Substances Control Act of 1976, 15 U.S.C. Section
2601 ET SEQ., the Occupational Safety and Health Act of 1970, as amended, 29
U.S.C. Section 651 ET SEQ., the Emergency Planning and Community
Right-to-Know Act of 1986, 42 U.S.C. Section 11001 ET SEQ., the Safe Drinking
Water Act of 1974, as amended, 42 U.S.C. Section 300(f) ET SEQ., the
Hazardous Materials Transportation Act, 49 U.S.C. Section 5101 ET SEQ., the
California Health and Safety Code Section 25117.4 ET SEQ., Chapter 6.5,
Hazardous Waste Control, and any similar or implementing state or local law,
and all amendments or regulations promulgated thereunder.
"ENVIRONMENTAL PERMIT" shall mean any permit, approval,
authorization, certificate, license, variance, filing or permission required
by or from any Governmental Authority pursuant to any Environmental Law.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as the same may be amended from time to time.
"ERISA AFFILIATE" shall mean any trade or business (whether or not
incorporated) that, together with the
10
Borrower, is treated as a single employer under Section 414(b) or (c) of the
Code, or solely for purposes of Section 302 of ERISA and Section 412 of the
Code, is treated as a single employer under Section 414 of the Code.
"ERISA EVENT" shall mean (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder, with respect to a
Plan; (b) the adoption of any amendment to a Plan that would require the
provision of security pursuant to Section 401(a)(29) of the Code or Section
307 of ERISA; (c) the existence with respect to any Plan of an "accumulated
funding deficiency" (as defined in Section 412 of the Code or Section 302 of
ERISA), whether or not waived; (d) the filing pursuant to Section 412(d) of
the Code or Section 303(d) of ERISA of an application for a waiver of the
minimum funding standard with respect to any Plan; (e) the incurrence of any
liability under Title IV of ERISA with respect to the termination of any Plan
or the withdrawal or partial withdrawal of the Borrower or any of its ERISA
Affiliates from any Plan or Multiemployer Plan; (f) the receipt by the
Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any
notice relating to the PBGC's or a plan administrator's intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan;
(g) the receipt by the Borrower or any ERISA Affiliate of any notice
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA; (h) the occurrence of a "prohibited
transaction" with respect to which the Borrower or any of its Subsidiaries is
a "disqualified person" (within the meaning of Section 4975 of the Code) or
with respect to which the Borrower or any such Subsidiary could otherwise be
liable; and (i) any other event or condition (other than the accrual and
payment of benefits in the ordinary course of business) with respect to a
Plan or Multiemployer Plan that could reasonably be expected to result in
liability of the Borrower (other than for ordinary periodic contribution
obligations).
"EURODOLLAR BORROWING" shall mean a Borrowing comprised of
Eurodollar Loans.
"EURODOLLAR LOAN" shall mean any Loan bearing interest at a rate
determined by reference to the Adjusted LIBO Rate in accordance with the
provisions of Article II.
11
"EVENT OF DEFAULT" shall have the meaning assigned to such term in
Article VII.
"FEE LETTER" shall mean the Fee Letter, dated October 31, 1995,
between the Borrower, Xxxx and the Administrative Agent, as amended by a fee
letter amendment agreement, dated as of the date hereof.
"FEES" shall mean the Commitment Fees, the Administrative Agent's
Fees, the Upfront Fees, the L/C Participation Fees and the Issuing Bank Fees.
"FINANCIAL OFFICER" of any corporation shall mean the chief
financial officer, principal accounting officer, Treasurer or Controller of
such corporation.
"FINANCIAL STATEMENTS" shall have the meaning assigned to such term
in Section 3.05.
"FOREIGN SUBSIDIARY" shall mean any Subsidiary that is not a
Domestic Subsidiary.
"FORM 10" shall mean the Registration Statement on Form 10 filed on
October 17, 1995, as amended on or prior to the date hereof, by the Borrower
with the Securities and Exchange Commission pursuant to the Securities and
Exchange Act of 1934.
"FORMATION" shall mean (i) the formation of the Borrower and
certain Subsidiaries of the Borrower and (ii) the acquisition by the Borrower
and its Subsidiaries of the real estate and resorts businesses previously
conducted by Xxxx and its subsidiaries, in each case as described in the Form
10.
"GAAP" shall mean generally accepted accounting principles applied
on a consistent basis.
"GOVERNMENTAL AUTHORITY" shall mean any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or
regulatory body.
"GUARANTEE" of or by any person shall mean any obligation,
contingent or otherwise, of such person guaranteeing or having the economic
effect of guaranteeing any Indebtedness of any other person (the "PRIMARY
OBLIGOR") in any manner, whether directly or indirectly, and including any
obligation of such person, direct or indirect, (a) to
12
purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or to purchase (or to advance or supply funds for the
purchase of) any security for the payment of such Indebtedness, (b) to
purchase or lease property, securities or services for the purpose of
assuring the owner of such Indebtedness of the payment of such Indebtedness
or (c) to maintain working capital, equity capital or any other financial
statement condition or liquidity of the primary obligor so as to enable the
primary obligor to pay such Indebtedness; PROVIDED, HOWEVER, that the term
Guarantee shall not include endorsements for collection or deposit in the
ordinary course of business.
"GUARANTEE AGREEMENT" shall mean each Guarantee Agreement, dated as
of December 27, 1995, as amended by the Omnibus Amendment, each Guarantee
Agreement, dated as of the date hereof, and each Guarantee Agreement which
may hereafter be delivered in connection with an Additional Mortgaged
Property, made by one or more of the Guarantors in favor of the Collateral
Agent for the benefit of the Secured Parties.
"GUARANTORS" shall mean each person listed on Schedule 1.01(b) and
each other person that becomes party to a Guarantee Agreement as a Guarantor,
and the permitted successors and assigns of each such person.
"HAZARDOUS MATERIALS" shall mean all explosive or radioactive
substances or wastes, hazardous or toxic substances or wastes, pollutants,
solid, liquid or gaseous wastes, including petroleum or petroleum
distillates, asbestos or asbestos containing materials, polychlorinated
biphenyls ("PCBs") or PCB-containing materials or equipment, radon gas,
infectious or medical wastes and all other substances or wastes of any nature
regulated pursuant to any Environmental Law.
"HAZARDOUS MATERIALS INDEMNITY AGREEMENT" shall mean the Hazardous
Materials Indemnity Agreement, dated as of December 27, 1995, as amended by
the Omnibus Amendment, among the Borrower, the Subsidiaries party thereto and
the Collateral Agent.
"HOMEBUILDING BUSINESS" shall mean, as to the Borrower and its
Subsidiaries, the business of developing, constructing and marketing
single-family and multifamily detached or attached homes and homesites within
master-planned residential communities or other parcels of land
13
owned, acquired or developed by them, but not including the business of
owning, operating, developing, constructing or marketing Resort Properties.
"INCOME PRODUCING PROPERTY" shall mean any multi-family
residential, commercial, industrial or retail property owned or leased by the
Borrower or any Subsidiary and improved with a building of which 80% or more
of the total square feet is leased or held for the purposes of leasing to
unaffiliated third parties (treating Xxxx for this purposes as an
unaffiliated third party), but not including any Resort Property or any
property improved by a golf course.
"INDEBTEDNESS" of any person shall mean, without duplication, (a)
all obligations of such person for borrowed money, (b) all obligations of
such person evidenced by bonds, debentures, notes or similar instruments, (c)
all obligations of such person upon which interest charges are customarily
paid, (d) all obligations of such person under conditional sale or other
title retention agreements relating to property or assets purchased by such
person, (e) all obligations of such person issued or assumed as the deferred
purchase price of property or services (excluding trade accounts payable and
accrued obligations incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien on property owned or acquired by such person, whether or not the
obligations secured thereby have been assumed, (g) all Guarantees by such
person of Indebtedness of others, (h) all Capital Lease Obligations of such
person and (i) all obligations of such person as an account party in respect
of letters of credit and bankers' acceptances. The Indebtedness of any
person shall include the Indebtedness of any partnership in which such person
is a general partner, PROVIDED that this sentence shall not apply to any
Indebtedness which is either expressly nonrecourse to its partners or owed to
the Borrower or to any wholly owned Subsidiary of the Borrower.
"INDEMNITY, SUBROGATION AND CONTRIBUTION AGREEMENT" shall mean the
Indemnity, Subrogation and Contribution Agreement, dated as of December 27,
1995, as amended by the Omnibus Amendment among the Borrower, the Guarantors
and the Collateral Agent, and as may thereafter be amended to include each
subsequent guarantor under a Guarantee Agreement.
14
"INTEREST COVERAGE RATIO" shall mean, for any period of four
consecutive fiscal quarters, the ratio of (a) EBITDA for such period, over
(b) Interest Expense for such period.
"INTEREST EXPENSE" shall mean, for any period, (a) the aggregate
consolidated interest expense for such period of the Borrower and its
Subsidiaries, plus (b) the amount of interest capitalized by the Borrower and
its Subsidiaries on a consolidated basis during such period, less (c)
consolidated interest income for such period of the Borrower and its
Subsidiaries, to the extent not included within the computation of EBITDA for
such period.
"INTEREST PAYMENT DATE" shall mean, with respect to any Loan, the
last day of the Interest Period applicable to the Borrowing of which such
Loan is a part and, in the case of a Eurodollar Borrowing with an Interest
Period of more than three months' duration, each day that would have been an
Interest Payment Date had successive Interest Periods of three months'
duration been applicable to such Borrowing, and, in addition, the date of any
prepayment of such Borrowing or conversion of such Borrowing to a Borrowing
of a different Type.
"INTEREST PERIOD" shall mean (a) as to any Eurodollar Borrowing,
the period commencing on the date of such Borrowing and ending on the
numerically corresponding day (or, if there is no numerically corresponding
day, on the last day) in the calendar month that is 1, 2, 3 or 6 months
thereafter, as the Borrower may elect and (b) as to any ABR Borrowing, the
period commencing on the date of such Borrowing and ending on the earliest of
(i) the next succeeding March 31, June 30, September 30 or December 31, (ii)
the Maturity Date and (iii) the date such Borrowing is converted to a
Borrowing of a different Type in accordance with Section 2.10 or repaid or
prepaid in accordance with Section 2.11; PROVIDED, HOWEVER, that if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless, in the
case of a Eurodollar Borrowing only, such next succeeding Business Day would
fall in the next calendar month, in which case such Interest Period shall end
on the next preceding Business Day. Interest shall accrue from and including
the first day of an Interest Period to but excluding the last day of such
Interest Period.
15
"INVENTORY" shall mean, at any date, the sum of (a) Unimproved
Land, plus (b) Land Under Development, plus (c) Unsold Homes/Lots, plus (d)
Contracted Homes/Lots, plus (e) Model Homes.
"INVESTMENTS" shall mean, with respect to any period, as to any
person, (a) amounts paid or agreed to be paid by such person by way of
investment and/or purchase of stock, securities, liabilities, properties or
assets of, or contributed to, any other person during such period and (b)
capital and development expenditures made during such period by such person
in its own assets and businesses, to the extent such expenditures are
required to be capitalized on a balance sheet of such person under GAAP.
"ISSUING BANK" shall mean, as the context may require, (a) The
Chase Manhattan Bank or (b) any other Lender that may become an Issuing Bank
pursuant to Section 2.20(i) or 2.20(k), with respect to Letters of Credit
issued by such Lender.
"ISSUING BANK FEES" shall have the meaning assigned to such term in
Section 2.05(c).
"XXXX'I CONTRACTED HOMES/LOTS" shall mean, at any date, the
consolidated book value at such date of all homesites of the Borrower and its
Subsidiaries on the Island of Xxxx'i (other than in the Xxxx'i City
development) on which construction has started, slab or foundation has been
completed and a contract of sale has been entered into with a third party.
"LAND UNDER DEVELOPMENT" shall mean, at any date, the consolidated
book value at such date of all land of the Borrower and its Subsidiaries
owned as part of their Homebuilding Business, on which grading or on-site
infrastructure improvements have commenced and for which all necessary zoning
and subdivision approvals have been obtained and are in full force and
effect, but for which home construction (other than the foundation or slab)
has not yet started.
"L/C COMMITMENT" shall mean the commitment of the Issuing Bank to
issue Letters of Credit pursuant to Section 2.20, and the commitment of each
Lender hereunder to participate in the L/C Exposure of the Issuing Bank in
accordance with each Lender's Applicable Percentage.
16
"L/C DISBURSEMENT" shall mean a payment or disbursement made to the
beneficiary of a Letter of Credit by the Issuing Bank for the account of the
Borrower pursuant to a Letter of Credit.
"L/C EXPOSURE" shall mean at any time the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time PLUS (b) the
aggregate principal amount of all L/C Disbursements that have not been
reimbursed by payment or financed by ABR Loans pursuant to Sections 2.02(f)
and 2.20(e). The L/C Exposure of any Lender at any time shall mean its
Applicable Percentage of the L/C Exposure at such time.
"L/C PARTICIPATION FEE" shall have the meaning assigned to such
term in Section 2.05(c).
"LENDERS" shall mean (a) the financial institutions listed on
Schedule 2.01 (other than any such financial institution that has ceased to
be a party hereto pursuant to an Assignment and Acceptance) and (b) any
financial institution that has become a party hereto pursuant to an
Assignment and Acceptance.
"LETTER OF CREDIT" shall mean any letter of credit issued pursuant
to Section 2.20, which letters of credit may be standby letters of credit or
commercial letters of credit, and shall include that certain letter of credit
dated April 15, 1997, in the maximum amount of $719,000, issued by The Chase
Manhattan Bank for the account of the Borrower to National Union Fire
Insurance Company of Pittsburgh as beneficiary, and any renewal, replacement
or extension thereof.
"LIBO RATE" shall mean, with respect to any Interest Period for any
Eurodollar Borrowing, the rate (rounded upwards, if necessary, to the next
1/16 of 1%) at which dollar deposits approximately equal in principal amount
to, the Administrative Agent's portion of such Eurodollar Borrowing and for a
maturity comparable to such Interest Period are offered to the principal
London office of the Administrative Agent in immediately available funds by
at least two Reference Banks in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period. The Administrative Agent will request the principal London
office of each Reference Bank to provide a quotation
17
of its rate, and the rate for that Eurodollar Borrowing will be the
arithmetic mean of the quotations.
"LIEN" shall mean, with respect to any asset, (a) any mortgage,
deed of trust, lien, pledge, encumbrance, charge or security interest in or
on such asset, (b) the interest of a vendor or a lessor under any conditional
sale agreement, capital lease (but not an operating lease) or title retention
agreement (or any financing lease having substantially the same economic
effect as any of the foregoing) relating to such asset and (c) in the case of
securities, any purchase option, call or similar right of a third party with
respect to such securities.
"LOAN DOCUMENTS" shall mean this Agreement, the Fee Letter, the
Letters of Credit, the Guarantee Agreements, the Security Documents, the
Hazardous Materials Indemnity Agreements, the Indemnity, Subrogation and
Contribution Agreements, the Omnibus Amendment, and any and all other
certificates, agreements, instruments and other documents heretofore, now or
hereafter executed and delivered by the Borrower, a Subsidiary and/or a
Financial Officer of the Borrower or a Subsidiary pursuant to a requirement
of, or condition in, any of such documents.
"LOAN PARTIES" shall mean the Borrower and the Guarantors.
"LOANS" shall mean the loans made to the Borrower pursuant to
Section 2.01 of the Original Credit Agreement and the loans made to the
Borrower pursuant to Section 2.01 of this Agreement. Each Loan shall be a
Eurodollar Loan or an ABR Loan.
"MAJOR LEASE" shall, with respect to any Mortgaged Property or
Additional Mortgaged Property, have the meaning assigned to such term in the
Mortgage on such Mortgaged Property or Additional Mortgaged Property.
"MARGIN STOCK" shall have the meaning assigned to such term in
Regulation U.
"MATERIAL ADVERSE EFFECT" shall mean (a) a materially adverse
effect on the business, assets, operations or financial condition of the
Borrower and the Subsidiaries taken as a whole, or (b) material impairment of
the ability of the Borrower, together with the Loan Parties, to pay the
Obligations as and when due.
18
"MATERIAL SUBSIDIARY" means (i) each Subsidiary listed on Schedule
1.01(d), (ii) each Subsidiary owning any Mortgaged Property or Additional
Mortgaged Property and (iii) each Subsidiary owning other assets having a
fair market value in excess of $5,000,000 (other than the Lanai Water
Company, but only to the extent that it continues in its current line of
business and does not acquire any material assets outside such line of
business) or holding licenses, permits or other rights which are material to
the ownership or operation of the assets of the Borrower or of any Material
Subsidiary.
"MATURITY DATE" shall mean May 16, 2000.
"MODEL HOMES" shall mean, at any date, the consolidated book value
at such date of all completed homes of the Borrower and its Subsidiaries,
which are not sold, and that are used as models to sell and market a
community.
"MORTGAGE AMENDMENTS" shall mean the Amendments, dated as of the
date hereof, of each of the Mortgages which are in effect prior to the
Closing Date.
"MORTGAGED PROPERTIES" shall mean the owned real properties and
leasehold and subleasehold interests of the Guarantors specified on Schedule
1.01(c), including, without limitation, the New Mortgage Properties. A
property shall cease to be a Mortgaged Property upon the sale of such
property or upon the release of the Lien of the Mortgage on such Mortgaged
Property.
"MORTGAGES" shall mean the mortgages, deeds of trust, leasehold
mortgages, security agreements, assignments of leases and rents,
modifications and other security documents delivered pursuant to clause (i)
of Section 4.02(h) or pursuant to Section 5.11, including the mortgage/deed
of trust, security agreement and assignment of leases and rents substantially
in the form of Exhibit E.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"NET INCOME" shall mean, for any period, the aggregate consolidated
net income (or net deficit) of the Borrower and its Subsidiaries, before
reduction for any dividends on preferred stock, but excluding from the
determination of consolidated net income any extraordinary or nonrecurring
gains or losses.
19
"NET PROCEEDS" shall mean, as to the sale of any property, (a) all
cash received by the Borrower or its Subsidiaries in consideration of such
sale, plus (b) any non-cash consideration received by the Borrower or its
Subsidiaries for such sale, including seller financing or the purchaser's
assumption of indebtedness, less (c) all direct costs to the Borrower and its
Subsidiaries of such sale, including transfer taxes, brokerage commissions
and legal fees; PROVIDED that Net Proceeds will not be reduced by previously
capitalized development costs, construction costs, financing costs or
marketing or selling expenses.
"NEW MORTGAGED PROPERTIES" shall mean (i) the Marketplace in
Bakersfield, California and (ii) Horizon IV in Raleigh, North Carolina.
"NON-CASH COST OF SALES" shall mean, for any period, as to the
Borrower and its Subsidiaries on a consolidated basis, the non-cash portion
of "cost of residential property sales" which is attributable to the
allocation of capitalized costs and estimated future common costs to
residential homesites.
"OBLIGATIONS" shall mean all obligations defined as "Obligations"
in the Guarantee Agreement and the Security Documents.
"OMNIBUS AMENDMENT" shall mean the Amendment, dated as of the
Closing Date, of the Guarantee Agreement, Hazardous Materials Indemnity
Agreement, Indemnity, Subrogation and Contribution Agreement and Pledge
Agreement substantially in the form of Exhibit D hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred
to and defined in ERISA.
"PERMITTED THIRD PARTY INDEBTEDNESS" means Indebtedness of the
Borrower which (i) is not secured by any property of the Borrower or any
Subsidiary and (ii) is not guaranteed by any Subsidiary.
"PERSON" shall mean any natural person, corporation, business
trust, joint venture, association, company, partnership or government, or any
agency or political subdivision thereof.
"PLAN" shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code
20
or Section 307 of ERISA, and in respect of which the Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.
"PLEDGE AGREEMENT" shall mean the Pledge Agreement, dated as of
December 27, 1995, as amended by the Omnibus Amendment, between the
Subsidiaries party thereto and the Collateral Agent for the benefit of the
Secured Parties, and as may hereafter be amended to include each subsequent
Guarantor under a Guarantee Agreement.
"PREFERRED SHARES" shall mean the 3,500 shares of Cumulative
Preferred Stock, par value $10,000 per share, of the Borrower.
"PROPERTIES" shall have the meaning assigned to such term in
Section 3.17(a).
"RAP" shall mean the remedial action plan for the remediation of
the Xxxx Cannery Commercial Development, the objective of which is to design
a work plan for remediation activities and provide the basis for a "no
further action" letter from the Hawaii State Department of Health.
"REFERENCE BANKS" shall mean Citicorp USA, Inc. and Bank of America
National Trust and Savings Association.
"REGISTER" shall have the meaning given such term in Section 9.04(d).
"REGULATION G" shall mean Regulation G of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION U" shall mean Regulation U of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION X" shall mean Regulation X of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"RELEASE" shall have the meaning given such term in Section 101(22)
of CERCLA (as defined under "Environmental Law" above).
"REMEDIAL ACTION" shall mean (i) "remedial action" as such term is
defined in Section 101(24) of CERCLA (as defined under "Environmental Law"
above) and (ii) all other actions required or voluntarily undertaken to (x)
clean up,
21
remove, treat, xxxxx or in any other way address any Hazardous Materials in
the environment or workplace, (y) prevent the Release or threat of Release,
or minimize the further Release of any Hazardous Materials so they do not
migrate or endanger or threaten to endanger public health or welfare of the
environment or workplace, or (z) perform studies and investigations in
connection with (x) or (y) above.
"RENT ROLL" shall, with respect to any Mortgaged Property or
Additional Mortgaged Property, have the meaning assigned to such term in the
Mortgage on such Mortgaged Property or Additional Mortgaged Property.
"REQUIRED LENDERS" shall mean, at any time, Lenders having
Applicable Percentages equal to at least 51%, in the aggregate.
"RESORT PROPERTY" shall mean (a) any real property or business
owned or operated by the Borrower or its Subsidiaries which is located or
operated primarily on the Island of Xxxx'i, including Xxxx'i residential
development properties and support services and other businesses, and (b) any
other hospitality or resort property or business owned, operated, developed
or acquired by the Borrower or its Subsidiaries.
"RESPONSIBLE OFFICER" of any corporation shall mean any executive
officer or Financial Officer of such corporation and any other officer or
similar official thereof responsible for the administration of the
obligations of such corporation in respect of this Agreement.
"REVOLVING CREDIT COMMITMENT" shall mean, with respect to each
Lender, the commitment of such Lender to make Loans hereunder as set forth in
Schedule 2.01, or in the Assignment and Acceptance pursuant to which such
Lender assumed its Revolving Credit Commitment, as applicable, as the same
may be reduced from time to time pursuant to Section 2.09 and pursuant to
assignments by such Lender pursuant to Section 9.04. The parties hereto
acknowledge that the Revolving Credit Commitments set forth in Schedule 2.01
are, in some respects, different than those previously in effect under the
Original Credit Agreement and, as of the Closing Date, Schedule 2.01 shall
apply and the Lenders shall be released from their Revolving Credit
Commitments under the Original Credit Agreement to the extent inconsistent
with Schedule 2.01.
22
"REVOLVING CREDIT EXPOSURE" shall mean, with respect to any Lender
at any time, the aggregate principal amount at such time of all outstanding
Loans of such Lender.
"SECURED PARTIES" shall mean (a) the Lenders, (b) the
Administrative Agent, (c) the Collateral Agent, (d) the Issuing Bank and (e)
the successors and assigns of the foregoing.
"SECURITY DOCUMENTS" shall mean the Mortgages, the Pledge Agreement
and each of the security agreements, mortgages and other instruments and
documents executed and delivered pursuant to any of the foregoing or pursuant
to Section 5.11.
"STANDING INVENTORY" shall mean, at any date, the number of unsold
homes (other than Model Homes) of the Borrower and its Subsidiaries owned as
part of their Homebuilding Business for which construction has been completed
as of such date.
"STATUTORY RESERVES" shall mean a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of
which is the number one minus the aggregate of the maximum reserve
percentages (including any marginal, special, emergency or supplemental
reserves) expressed as a decimal established by the Board and any other
banking authority, domestic or foreign, to which the Administrative Agent or
any Lender (including any branch, Affiliate, or other fronting office making
or holding a Loan) is subject for Eurocurrency Liabilities (as defined in
Regulation D of the Board). Such reserve percentages shall include those
imposed pursuant to such Regulation D. Eurodollar Loans shall be deemed to
constitute Eurocurrency Liabilities and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or
offsets that may be available from time to time to any Lender under such
Regulation D. Statutory Reserves shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
"SUBSIDIARY" shall mean, with respect to any person (herein
referred to as the "parent"), any corporation, partnership, association or
other business entity (a) of which securities or other ownership interests
representing more than 50% of the ordinary voting power or more than 50% of
the general partnership interests are, at the time any determination is being
made, owned, controlled or held, directly or indirectly, or (b) that is, at
the time any determination is made, otherwise directly or indirectly
23
Controlled by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.
"SUBSIDIARY" shall mean any subsidiary of the Borrower.
"TANGIBLE NET WORTH" shall mean, at any date, on a consolidated
basis for the Borrower and its Subsidiaries, the sum of (a) capital stock of
the Borrower outstanding (other than shares of preferred, preferential or
preference stock) based on paid-in capital, plus (b) retained earnings, less
(c) minority interest in subsidiaries, if any, less (d) intangible assets
such as goodwill, trademarks, tradenames, copyrights and similar types of
assets treated as intangible assets under GAAP.
"TERM NOTE" shall mean the Promissory Note, to be dated the date of
the Formation, of the Borrower payable to Xxxx in the aggregate principal
amount of $10,000,000, and delivered to Xxxx in partial consideration of the
transfer of assets to the Borrower and its Subsidiaries in the Formation, as
described in the Form 10 and attached as an exhibit thereto.
"TOTAL INDEBTEDNESS" shall mean all Indebtedness of the Borrower
and its Subsidiaries on a consolidated basis, excluding Indebtedness
permitted under Section 6.01(f), but including, without limitation, any and
all indebtedness of the Borrower and its Subsidiaries pursuant to this
Agreement.
"TOTAL L/C COMMITMENT" shall mean, at any time, the aggregate
amount of the Lenders' L/C Commitments, as in effect at such time (without
duplication for the L/C Commitment of the Issuing Bank).
"TOTAL REVOLVING CREDIT COMMITMENT" shall mean, at any time, the
aggregate amount of the Revolving Credit Commitments, as in effect at such
time.
"TOTAL COMMITMENT" shall mean the sum of the Total Revolving Credit
Commitment and the Total L/C Commitment.
"TOTAL EXPOSURE" shall mean, at any time, the sum of the Lenders'
aggregate Revolving Credit Exposure and the Lenders' aggregate L/C Exposure
(without duplication for the L/C Exposure of the Issuing Bank).
"TOTAL INDEBTEDNESS CERTIFICATE" shall have the meaning assigned to
such term in Section 5.04(d).
24
"TRADEMARK LICENSE AGREEMENT" shall mean the Trademark License
Agreement between Xxxx and the Borrower, in the form attached as an exhibit
to the Form 10.
"TRANSACTIONS" shall have the meaning assigned to such term in
Section 3.02.
"TRANSFEREE" shall have the meaning assigned to such term in
Section 2.18(a).
"TYPE", when used in respect of any Loan or Borrowing, shall refer
to the Rate by reference to which interest on such Loan or on the Loans
comprising such Borrowing is determined. For purposes hereof, the term
"Rate" shall include the Adjusted LIBO Rate and the Alternate Base Rate.
"UNIMPROVED LAND" shall mean, at any date, the consolidated book
value at such date of all land of the Borrower and its Subsidiaries owned as
part of their Homebuilding Business, for which no grading or on-site
infrastructure improvements have been made.
"UNSOLD HOMES/LOTS" shall mean, at any date, the consolidated book
value at such date of all homes and homesites (other than Model Homes) of the
Borrower and its Subsidiaries owned as part of their Homebuilding Business
for which above-ground construction has started, but for which there is no
contract of sale with a third party.
"UNSOLD INVENTORY" shall mean, at any date, all Standing Inventory
and all Work in Progress as of such date. The term Unsold Inventory shall
not include homesites to be sold without homes.
"UPFRONT FEES" shall mean the fees payable by the Borrower to each
Lender on the date hereof equal to .10% of such Lender's Applicable
Percentage of the Total Commitment on the date hereof, which Total Commitment
on the date hereof is $250,000,000.
"WHOLLY OWNED SUBSIDIARY" of any person shall mean a subsidiary of
such person of which securities (except for directors' qualifying shares) or
other ownership interests representing 100% of the equity or 100% of the
ordinary voting power or 100% of the partnership interests are, at the time
any determination is being made, owned, controlled or held by such person or
one or more wholly owned subsidiaries of such person or by such person and
one or more wholly owned subsidiaries of such person.
25
"WITHDRAWAL LIABILITY" shall mean liability to a Multiemployer Plan
as a result of a complete or partial withdrawal from such Multiemployer Plan,
as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
"WORK IN PROGRESS" shall mean, at any date, the number of unsold
homes (other than Model Homes) of the Borrower and its Subsidiaries owned as
part of their Homebuilding Business for which above-ground home construction
has been commenced, but not yet completed as of such date.
SECTION 1.02. Terms Generally. The definitions in Section 1.01
shall apply equally to both the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words "include",
"includes" and "including" shall be deemed to be followed by the phrase
"without limitation". All references herein to Articles, Sections, Exhibits
and Schedules shall be deemed references to Articles and Sections of, and
Exhibits and Schedules to, this Agreement unless the context shall otherwise
require. Except as otherwise expressly provided herein, (a) any reference in
this Agreement to any Loan Document shall mean such document as amended,
restated, supplemented or otherwise modified from time to time, (b) any
reference in this Agreement to cash shall mean cash or any cash equivalent
and (c) all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided, however, that
for purposes of determining compliance with the covenants contained in
Article VI, all accounting terms herein shall be interpreted and all
accounting determinations hereunder shall be made in accordance with GAAP as
in effect on the date of this Agreement and applied on a basis consistent
with the application used in the financial statements referred to in Section
3.05(a).
ARTICLE II. THE CREDITS
SECTION 2.01. COMMITMENTS. Subject to the terms and conditions
and relying upon the representations and warranties herein set forth, each
Lender agrees, severally and not jointly, to provide the Borrower with a
Commitment equal to the product of such Lender's Applicable Percentage and
$250,000,000, subject to reduction as herein set forth. Pursuant thereto,
each Lender agrees, severally and not jointly, to make Loans to the Borrower,
at any time and from time to time on or after the date hereof, and until the
earlier of the Maturity Date and the termination of the
26
Commitment of such Lender in accordance with the terms hereof, in an
aggregate principal amount at any time outstanding that will not result in
(i) such Lender's Total Exposure exceeding (ii) the lesser of (x) such
Lender's Applicable Percentage of the Total Commitment and (y) such Lender's
Applicable Percentage of the Borrowing Base in effect at such time. Within
the limits set forth in this Section 2.01 and subject to the terms,
conditions and limitations set forth herein, including without limitation,
Section 2.09, the Borrower may borrow, pay or prepay and reborrow Loans on
and after the Closing Date and prior to the Maturity Date. Without limiting
the foregoing or any other provision of this Agreement, in no event and at no
time shall the sum of (i) the aggregate Revolving Credit Exposure (i.e., the
aggregate principal amount of the Loans) and (ii) the aggregate L/C Exposure
exceed the lesser of (x) the Borrowing Base (as the Borrowing Base may be
changed from time to time pursuant to the provisions of this Agreement,
including, without limitation, the provisions of Section 2.09) or (y)
$250,000,000 (reduced from time to time by the amount of any reduction from
time to time in the Total Commitment occurring pursuant to the provisions of
this Agreement, including, without limitation, the provisions of Section
2.09). As a consequence thereof, and notwitstanding anything to the contrary
contained or implied elsewhere in this Agreement, in no event and at no time
may the Total Exposure exceed $250,000,000.
SECTION 2.02. LOANS. (a) Each Loan shall be made as part of a
Borrowing consisting of Loans made by the Lenders ratably in accordance with
their respective Applicable Percentages; PROVIDED, HOWEVER, that the failure
of any Lender to make any Loan shall not in itself relieve any other Lender
of its obligation to lend hereunder (it being understood, however, that no
Lender shall be responsible for the failure of any other Lender to make any
Loan required to be made by such other Lender). The Loans comprising any
Borrowing shall be in an aggregate principal amount that is (i) an integral
multiple of $1,000,000 and not less than $5,000,000 or (ii) equal to the
remaining available balance of the applicable Revolving Credit Commitments.
(b) Subject to Sections 2.08 and 2.13, each Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may
request pursuant to Section 2.03. Each Lender may at its option make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of
such Lender to make such Loan; PROVIDED that any exercise of such option
shall not affect the obligation of the Borrower to repay such Loan in
accordance with the
27
terms of this Agreement. Borrowings of more than one Type may be outstanding
at the same time; PROVIDED, HOWEVER, that the Borrower shall not be entitled
to request any Borrowing that, if made, would result in more than seven
Eurodollar Borrowings outstanding hereunder at any time. For purposes of the
foregoing, Borrowings having different Interest Periods, regardless of
whether they commence on the same date, shall be considered separate
Borrowings.
(c) Each Lender shall make each Loan to be made by it hereunder on
the proposed date thereof by wire transfer of immediately available funds to
such account in New York City as the Administrative Agent may designate not
later than 1:00 p.m., New York City time, or, in the case of a Borrowing
under Section 2.03(b), such later time as each Lender may have been notified
by the Administrative Agent (which notice may be given by telecopy) and the
Administrative Agent shall by 2:00 p.m., New York City time, credit the
amounts so received to an account in the name of the Borrower, maintained
with the Administrative Agent and designated by the Borrower in the
applicable Borrowing Request or, if a Borrowing shall not occur on such date
because any condition precedent herein specified shall not have been met,
return the amounts so received to the respective Lenders.
(d) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any Borrowing (or prior to 2:00 p.m., New
York City time, on the date of an ABR Borrowing made pursuant to the proviso
of clause (b) of Section 2.03) that such Lender will not make available to
the Administrative Agent such Lender's portion of such Borrowing, the
Administrative Agent may assume that such Lender has made such portion
available to the Administrative Agent on the date of such Borrowing in
accordance with paragraph (c) above and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If the Administrative Agent shall have so made funds
available then, to the extent that such Lender shall not have made such
portion available to the Administrative Agent after demand therefor, 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, a rate
determined by the Administrative Agent to represent its cost of overnight or
short-term funds (which
28
determination shall be conclusive absent manifest error). If such Lender
shall repay to the Administrative Agent such corresponding amount, such
amount shall constitute such Lender's Loan as part of such Borrowing for
purposes of this Agreement.
(e) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request any Eurodollar Borrowing if the
Interest Period requested with respect thereto would end after the Maturity
Date. The Interest Period for any ABR Borrowing shall in no event extend
beyond the Maturity Date, as provided under clause (b)(ii) of the definition
of "Interest Period".
(f) If the Issuing Bank shall not have received from the Borrower
any payment required to be made under Section 2.20(e) by the time such
payment is required to be made, then the Issuing Bank will promptly notify
the Administrative Agent of the L/C Disbursement and the Administrative Agent
will promptly notify each Lender of such L/C Disbursement and its Applicable
Percentage thereof. Each Lender shall pay by wire transfer of immediately
available funds to the Administrative Agent not later than 2:00 p.m., New
York City time, on such date (or, if such Lender shall have received such
notice later than 12:00 noon, New York City time), on any day, not later than
10:00 a.m., New York City time, on the immediately following Business Day),
an amount equal to such Lender's Applicable Percentage of such L/C
Disbursement and the Administrative Agent will promptly pay to the Issuing
Bank amounts so received by it from the Lenders. The Administrative Agent
will promptly pay to the Issuing Bank any amounts received by it from the
Borrower pursuant to Section 2.20(e) prior to the time that any Lender makes
any payment pursuant to this paragraph (f); any such amounts received by the
Administrative Agent thereafter will be promptly remitted by the
Administrative Agent to the Lenders that shall have made such payments and to
the Issuing Bank, as their interests may appear. If any Lender shall not have
made its Applicable Percentage of such L/C Disbursement available to the
Administrative Agent as provided above, such Lender and the Borrower
severally agree to pay interest on such amount, for each day from and
including the date such amount is required to be paid in accordance with this
paragraph to but excluding the date such amount is paid, to the
Administrative Agent for the account of the Issuing Bank at (i) in the case
of the Borrower, the applicable rate per annum under Section 2.20(h), without
duplication and (ii) in the case of such Lender, the Federal Funds Effective
Rate. If (i) the Lenders make the payments required pursuant to this
paragraph (f) in respect of any L/C Disbursement, and
29
(ii) the conditions to Borrowing set forth in Section 4.01 are satisfied at
the time, then the amount of such payments so specified shall constitute ABR
Loans made on the date such payments were made for all purposes hereof and
the Administrative Agent shall promptly advise the Lenders thereof.
SECTION 2.03. BORROWING PROCEDURE. In order to request a
Borrowing, the Borrower shall hand deliver or telecopy to the Administrative
Agent a duly completed Borrowing Request (a) in the case of a Eurodollar
Borrowing, not later than 1:45 p.m., New York City time, three Business Days
before a proposed Borrowing, and (b) in the case of an ABR Borrowing, not
later than 2:00 p.m., New York City time, one Business Day before a proposed
Borrowing; PROVIDED that in the case of an ABR Borrowing the Borrower may
deliver a duly completed Borrowing Request to the Administrative Agent not
later than 2:00 p.m., New York City time, on the day of a proposed Borrowing
so long as the aggregate amount of Loans made pursuant to such same day
Borrowing Requests does not exceed $10,000,000 on any single day. Each
Borrowing Request shall be irrevocable, shall be signed by or on behalf of
the Borrower and shall specify the following information: (i) whether the
Borrowing then being requested is to be a Eurodollar Borrowing or an ABR
Borrowing; (ii) the date of such Borrowing (which shall be a Business Day),
(iii) the number and location of the account to which funds are to be
disbursed (which shall be an account that complies with the requirements of
Section 2.02(c)); (iv) the amount of such Borrowing; and (v) if such
Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect
thereto; PROVIDED, HOWEVER, that, notwithstanding any contrary specification
in any Borrowing Request, each requested Borrowing shall comply with the
requirements set forth in Section 2.02. If no election as to the Type of
Borrowing is specified in any such notice, then the requested Borrowing shall
be an ABR Borrowing. If no Interest Period with respect to any Eurodollar
Borrowing is specified in any such notice, then the Borrower shall be deemed
to have selected an Interest Period of one month's duration. The
Administrative Agent shall promptly advise the Lenders of any notice given
pursuant to this Section 2.03 (and the contents thereof), and of each
Lender's portion of the requested Borrowing.
SECTION 2.04. EVIDENCE OF DEBT; REPAYMENT OF LOANS. (a) The
Borrower hereby unconditionally promises to pay to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each Loan
on the Maturity Date.
30
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower
to such Lender resulting from each Loan made by such Lender from time to
time, including the amounts of principal and interest payable and paid such
Lender from time to time under this Agreement.
(c) The Administrative Agent shall maintain accounts in which it
will record (i) the amount of each Loan made hereunder, the Type thereof and
the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to
each Lender hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder from the Borrower or any Guarantor and each
Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraphs (b) and (c) above shall be prima facie evidence of the existence
and amounts of the obligations therein recorded; 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.
(e) Notwithstanding any other provision of this Agreement, in the
event any Lender shall request and receive a promissory note payable to such
Lender and its registered assigns, the interests represented by such note
shall at all times (including after any assignment of all or part of such
interests pursuant to Section 9.04) be represented by one or more promissory
notes payable to the payee named therein or its registered assigns.
SECTION 2.05. FEES. (a) The Borrower agrees to pay to each
Lender, through the Administrative Agent, on the last day of March, June,
September and December in each year and on each date on which the Commitments
of such Lender shall expire or be terminated as provided herein, a commitment
fee (a "COMMITMENT FEE") on the average daily unused amount of such Lender's
Applicable Percentage of the Total Commitment, less the amount of any issued
but undrawn Letter(s) of Credit (i.e., such Lender's Applicable Percentage of
$250,000,000, subject to any permanent reduction pursuant to Section 2.09,
less the sum of the average daily aggregate principal balances of all of the
Loans and the average daily aggregate issued and undrawn amounts of the
Letters of Credit) during the preceding quarter (or other period commencing
with the date hereof or ending with the Maturity Date or the date on which
the
31
Commitments of such Lender shall expire or be terminated) of (i) 0.25% per
annum for any period as to which the Total Indebtedness on the first Business
Day immediately preceding the first day of such period is less than 87.5% of
the Borrowing Base and (ii) 0.30% per annum for any period as to which the
Total Indebtedness on the first Business Day immediately preceding the first
day of such period is greater than or equal to 87.5% of the Borrowing Base.
All Commitment Fees shall be computed on the basis of the actual number of
days elapsed in a year of 360 days. The Commitment Fee due to each Lender
shall commence to accrue on the date hereof and shall cease to accrue on the
date on which the Commitments of such Lender shall be terminated as provided
herein.
(b) The Borrower agrees to pay to the Administrative Agent, for
its own account, the administrative fees set forth in the Fee Letter at the
times and in the amounts specified therein (the "ADMINISTRATIVE AGENT FEES").
(c) The Borrower agrees to pay (i) to each Lender, through the
Administrative Agent, on the last day of March, June, September and December
of each year and on the date on which the Commitments of such Lender shall be
terminated as provided herein, a fee (a "L/C PARTICIPATION FEE") per annum on
such Lender's Applicable Percentage of the average daily aggregate L/C
Exposure (excluding the portion thereof attributable to unreimbursed L/C
Disbursements) during the preceding quarter (or shorter period commencing
with the Closing Date or ending with the Maturity Date or the date on which
the Commitments of such Lender shall be terminated) equal to (x) 1.50% for
any period as to which the Total Indebtedness on the first Business Day
immediately preceding the first day of such period is greater than or equal
to 87.5% of the Borrowing Base, (y) 1.375% for any period as to which the
Total Indebtedness on the first Business Day immediately preceding the first
day of such period exceeds 70% of the Borrowing Base, but does not exceed
87.5% of the Borrowing Base, (z) 1.25% for any period as to which the Total
Indebtedness on the first Business Day immediately preceding the first day of
such period is less than or equal to 70% of the Borrowing Base and (ii) to
the Issuing Bank with respect to each Letter of Credit, on the last day of
March, June, September and December in each year and on the date on which the
L/C Commitment of such Issuing Bank shall be terminated as provided herein, a
fee equal to 0.10% per annum (or such other rate as the Borrower and such
Issuing Bank may agree) on the aggregate L/C Exposure (exclusive of any L/C
Disbursements which have been repaid or become ABR Loans)
32
during the preceding quarter (or shorter period commencing with the date of
issuance of such Letter of Credit or ending with the expiration or
termination of such Letter of Credit) plus, in connection with the issuance,
amendment, extension, renewal or transfer of any Letter of Credit or any L/C
Disbursement, the Issuing Bank's customary documentary, processing and other
fees and charges (collectively, the "ISSUING BANK FEES"). All L/C
Participation Fees and Issuing Bank Fees shall be computed on the basis of
the actual number of days elapsed in a year of 360 days.
All Fees shall be paid on the dates due, in immediately available
funds, to the Administrative Agent for distribution, if and as appropriate,
among the Lenders, except that the Issuing Bank Fees shall be paid directly
to the Issuing Bank. Once paid, none of the Fees shall be refundable under
any circumstances.
SECTION 2.06. Interest on LOANS. (a) Subject to the provisions
of Section 2.07, the Loans comprising each ABR Borrowing shall bear interest
(computed on the basis of the actual number of days elapsed over a year of
360 days) at a rate per annum equal to the Alternate Base Rate.
(b) Subject to the provisions of Section 2.07, the Loans
comprising each Eurodollar Borrowing shall bear interest (computed on the
basis of the actual number of days elapsed over a year of 360 days) at a rate
per annum equal to the Adjusted LIBO Rate for the Interest Period in effect
for such Borrowing plus (i) 1.50% for any period as to which the Total
Indebtedness on the first Business Day immediately preceding the first day of
such period is greater than or equal to 87.5% of the Borrowing Base, (ii)
1.375% for any period as to which the Borrower's Total Indebtedness on the
first Business Day immediately preceding the first day of such period exceeds
70% of the Borrowing Base, but is less than 87.5% of the Borrowing Base and
(iii) 1.25% for any period as to which the Borrower's Total Indebtedness on
the first Business Day immediately preceding the first day of such period is
less than or equal to 70% of the Borrowing Base. It is expressly agreed that
the applicable interest rate margin over the Adjusted LIBO Rate set forth
above shall remain fixed during each fiscal quarter, notwithstanding any
decrease in the ratio of Total Indebtedness to the Borrowing Base during such
fiscal quarter, subject only to the following exceptions: If (x) an
Additional Mortgaged Property shall be added to the Collateral in accordance
with the provisions of this Agreement, and a new Borrowing Base Certificate
is delivered to the Administrative Agent in connection therewith pursuant to
Section 2.09(e) which includes the permitted Allocated
33
Loan Value of such Additional Mortgaged Property, and simultaneously
therewith a new Total Indebtedness Certificate is delivered by the Borrower
to the Administrative Agent, or (y) a Mortgaged Property or Additional
Mortgaged Property is reappraised due to a significant decrease of a
Mortgaged Property as set forth in the definition of "Allocated Loan Value",
or (z) a Mortgaged Property or Additional Mortgaged Property is sold or
otherwise required to be removed from the Borrowing Base pursuant to the
provisions of this Agreement (in which event a new Borrowing Base Certificate
reflecting the removal of such Mortgaged Property or Additional Mortgage
Property, and a new Total Indebtedness Certificate, shall be delivered to the
Administrative Agent within ten (10) Business Days of the date such Property
is sold or otherwise required to be removed from the Borrowing Base), THEN,
if the ratio of Total Indebtedness (as set forth in the new Total
Indebtedness Certificate) to the Borrowing Base (as set forth in such new
Borrowing Base Certificate) indicates a change of such ratio, the Lenders
agree that the applicable interest rate margin shall be decreased or
increased, as the case may be, based upon such changed ratio, expressed as a
percentage, in accordance with the preceding provisions of this Section 2.06
(b), effective as of the Business Day the new Total Indebtedness and
Borrowing Base Certificates were delivered to the Administrative Agent, in
the case of clause (x), as of the date the Required Lenders approve the
written estimate of any reappraisal, in the case of clause (y), and as of the
date a Property is sold or otherwise required to be removed from the
Borrowing Base, in the case of clause (z).
Interest on each Loan shall be payable on the Interest Payment
Dates applicable to such Loan except as otherwise provided in this Agreement.
The applicable Alternate Base Rate or Adjusted LIBO Rate for each Interest
Period or day within an Interest Period, as the case may be, shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.
SECTION 2.07. DEFAULT INTEREST. If the Borrower shall default in
the payment of the principal of or interest on any Loan or any other amount
becoming due hereunder, by acceleration or otherwise, or under any other Loan
Document, the Borrower shall on demand from time to time pay interest, to the
extent permitted by law, on such defaulted amount to but excluding the date
of actual payment (after as well as before judgment) (a) in the case of
overdue principal, at the rate otherwise applicable to such Loan pursuant to
Section 2.06 plus 2.00% per annum and (b) in all other cases, at a rate per
annum (computed on the basis of the
34
actual number of days elapsed over a year of 360 days) equal to the sum of
the Alternate Base Rate plus 2.00%. Such default rate of interest is
referred to herein as the "DEFAULT RATE".
SECTION 2.08. ALTERNATE RATE OF INTEREST. In the event, and on
each occasion, that on the day two Business Days prior to the commencement of
any Interest Period for a Eurodollar Borrowing the Administrative Agent shall
have determined that dollar deposits in the principal amounts of the Loans
comprising such Borrowing are not generally available in the London interbank
market, or that the rates at which such dollar deposits are being offered
will not adequately and fairly reflect the cost to any Lender of making or
maintaining its Eurodollar Loan during such Interest Period, or that
reasonable means do not exist for ascertaining the Adjusted LIBO Rate, the
Administrative Agent shall, as soon as practicable thereafter, give written
or telecopy notice of such determination to the Borrower and the Lenders. In
the event of any such determination, until the Administrative Agent shall
have advised the Borrower and the Lenders that the circumstances giving rise
to such notice no longer exist, any request by the Borrower for a Eurodollar
Borrowing pursuant to Section 2.03 shall be deemed to be a request for an ABR
Borrowing. Each determination by the Administrative Agent hereunder shall be
conclusive absent manifest error.
SECTION 2.09. TERMINATION AND REDUCTION OF COMMITMENTS; INCREASE
AND REDUCTION OF BORROWING BASE; RELEASE OF LIENS. (a) The Commitments
shall be automatically terminated on the Maturity Date and may be sooner
terminated as set forth in this Agreement.
(b) Upon the sale, in whole but not in part, of any Mortgaged
Property or Additional Mortgaged Property to a person (other than the
Borrower or any Subsidiary) in compliance with Section 6.05, the Collateral
Agent will (provided that no Default or Event of Default shall have occurred)
release the Lien of the Mortgage thereon, whereupon the Borrowing Base shall
be automatically reduced, if applicable, and the Total Commitment shall be
automatically and permanently reduced, as provided in this Section 2.09(b).
The Borrowing Base shall be automatically reduced, if applicable, and the
Total Commitment shall be automatically and permanently reduced, upon the
sale of properties by the Borrower or any Subsidiary to any person other than
the Borrower or any wholly owned Subsidiary of the Borrower as follows:
35
(i) upon the sale of any Mortgaged Property or any Additional
Mortgaged Property, by an amount equal to the greater of (A) the Allocated
Loan Value of such property or (B) 75% of the Net Proceeds of such sale;
(ii) upon the sale of any Income Producing Property which is not a
Mortgaged Property or an Additional Mortgaged Property, in which Net
Proceeds exceed $15,000,000 by an amount equal to 75% of the Net Proceeds
of such sale;
(iii) upon the sale of any Inventory in a single sale or in related
sales with the same or related purchasers in which the cumulative Net
Proceeds for all such sales exceed $15,000,000, by an amount equal to 75%
of such Net Proceeds;
(iv) upon the sale of any other real property held by the Borrower
or its Subsidiaries in their commercial and industrial property portfolio
(other than a Mortgaged Property or an Additional Mortgaged Property) in a
single sale or in related sales with the same or related purchasers in
which the cumulative Net Proceeds for all such sales exceed $15,000,000, by
an amount equal to 75% of such Net Proceeds; and
(v) upon the sale of any Resort Property in a single sale or in
related sales with the same or related purchasers in which the cumulative
Net Proceeds for all such sales exceed $10,000,000, by an amount equal to
50% of such Net Proceeds;
PROVIDED, HOWEVER, that if any such sale shall occur during such time as an
Event of Default is continuing, such sale shall automatically and permanently
reduce the Total Commitment by an amount equal to 100% of the Net Proceeds of
such sale (in lieu of the reductions otherwise provided above).
Notwithstanding the foregoing, no reduction in the amount of the
Total Commitment shall occur as a consequence of a sale of any Mortgaged
Property or any Additional Mortgaged Property pursuant to clause (i) above
if, after giving effect to such sale, the aggregate Allocated Loan Value of
all remaining Mortgaged Properties and Additional Mortgaged Properties shall
be equal to or greater than $115,000,000. The Lenders, each Lender acting in
its sole discretion, may elect to waive any reduction in the amount of the
Total Commitment as a consequence of the sale of any Mortgaged Property or
any Additional Mortgaged Property pursuant to clause (i) above where, after
giving effect to
36
such sale, the aggregate Allocated Loan Value of all remaining Mortgaged
Properties and Additional Mortgaged Properties shall be equal to or greater
than $115,000,000. The Lenders, each Lender acting in its sole discretion,
may elect to waive any reduction in the amount of the Total Commitment as a
consequence of the sale of any Mortgaged Property or any Additional Mortgaged
Property pursuant to clause (i) above where, after giving effect to such
sale, the aggregate Allocated Loan Value of all remaining Mortgaged
Properties and Additional Mortgaged Properties is less than $115,000,000 as
follows: The Administrative Agent shall request such waiver from each Lender
after receipt by the Administrative Agent of a written request to do so from
the Borrower. If any Lender shall fail to respond to such written request
for such a waiver within fifteen (15) Business Days after the receipt by such
Lender of such request from the Administrative Agent, such Lender shall be
deemed to have elected not to waive such automatic and permanent reduction in
the amount of the Total Commitment. If the Lenders elect such waiver, such
waiver shall be effective as of the date the Lenders have made such election,
and shall not be effective prior to such date. Nothing contained in this
paragraph shall affect or be deemed to apply to any reduction in the
Borrowing Base which may occur pursuant to clause (i) above.
Concurrently with the sale of any Mortgaged Property, Additional
Mortgaged Property or Inventory which will cause a reduction of the Borrowing
Base and/or the Total Commitment pursuant to Section 2.09(b)(i) or (iii), the
Borrower shall deliver to the Administrative Agent and each Lender a written
notice of such sale and a Borrowing Base Certificate showing (x) the
Borrowing Base as of the close of business on the last day of the preceding
fiscal quarter, as adjusted to give effect to such sale and (y) the
calculation of the Net Proceeds of such sale. If any such reduction in the
Total Commitment or any resulting reduction in the Borrowing Base would
require a repayment or prepayment of outstanding Borrowings pursuant to
Section 2.11(b) or (c) prior to the end of an Interest Period in effect for
any Eurodollar Loan, then if requested by the Borrower, the effective date of
such reduction shall be deferred until the end of such Interest Period (but
not longer than 90 days); PROVIDED that the Borrower shall deposit with the
Administrative Agent cash equal to the amount of such reduction in the
Revolving Credit Commitments. The Collateral Agent, as collateral agent for
the Secured Parties, will hold such cash deposit pursuant to the cash
collateral agreement to be delivered pursuant to Section 4.02(v) in an
interest-bearing collateral account as additional Collateral for the
Obligations hereunder until the date of such reduction and repayment or
prepayment.
(c) Upon at least three Business Days' prior irrevocable written
or telecopy notice to the Administrative Agent, the Borrower may at any time
in whole permanently terminate, or from time to time in part permanently
reduce, the Revolving Credit Commitments; PROVIDED, HOWEVER, that (i) each
partial reduction of the Revolving Credit
37
38
Commitments shall be in an integral multiple of $1,000,000 and in a minimum
amount of $5,000,000 and (ii) the Total Revolving Credit Commitment shall not
be reduced to an amount that is less than the Aggregate Revolving Credit
Exposure at the time.
(d) Each reduction in the Revolving Credit Commitments hereunder
shall be made ratably among the Lenders in accordance with their respective
Revolving Credit Commitments. The Borrower shall pay to the Administrative
Agent for the account of the applicable Lenders, on the date of each
termination, the Commitment Fees on the amount of the Revolving Credit
Commitments so terminated accrued to but excluding the date of such
termination.
(e) Increases in the Borrowing Base as a consequence of Additional
Mortgaged Properties shall be effective on the date a Borrowing Base
Certificate which includes the permitted Allocated Loan Value(s) of an
Additional Mortgaged Property or Additional Mortgaged Properties has been
delivered to the Administrative Agent. Any such Borrowing Base Certificate
may be delivered to the Administrative Agent on any Business Day after an
Additional Mortgaged Property has been added to the Collateral in accordance
with the provisions of this Agreement. Increases in the Borrowing Base as a
consequence of changes in the value of Land Under Development, Unsold
Homes/Lots and Model Homes and Contracted Homes/Lots shall be effective only
on the Business Day on which a Borrowing Base Certificate is delivered
pursuant to Section 5.04(d).
SECTION 2.10. CONVERSION AND CONTINUATION OF BORROWINGS. The
Borrower shall have the right at any time upon prior irrevocable notice to
the Administrative Agent (a) not later than 2:00 p.m., New York City time,
one Business Day prior to conversion, to convert any Eurodollar Borrowing
into an ABR Borrowing, (b) not later than 1:45 p.m., New York City time,
three Business Days prior to conversion or continuation, to convert any ABR
Borrowing into a Eurodollar Borrowing or to continue any Eurodollar Borrowing
as a Eurodollar Borrowing for an additional Interest Period, and (c) not
later than 1:45 p.m., New York City time, three Business Days prior to
conversion, to convert the Interest Period with respect to any Eurodollar
Borrowing to another permissible Interest Period, subject in each case to the
following:
(i) each conversion or continuation shall be made pro rata among the
Lenders in accordance with the respective principal amounts of the Loans
comprising the converted or continued Borrowing;
38
(ii) if less than all the outstanding principal amount of any
Borrowing shall be converted or continued, then each resulting Borrowing
shall satisfy the limitations specified in Sections 2.02(a) and 2.02(b)
regarding the principal amount and maximum number of Borrowings of the
relevant Type;
(iii) each conversion shall be effected by each Lender and the
Administrative Agent by recording for the account of such Lender the new
Loan of such Lender resulting from such conversion and reducing the Loan
(or portion thereof) of such Lender being converted by an equivalent
principal amount; accrued interest on any Eurodollar Loan (or portion
thereof) being converted shall be paid by the Borrower at the time of
conversion;
(iv) if any Eurodollar Borrowing is converted at a time other than
the end of the Interest Period applicable thereto, the Borrower shall pay,
upon demand, any amounts due to the Lenders pursuant to Section 2.14;
(v) any portion of a Borrowing maturing or required to be repaid in
less than one month may not be converted into or continued as a Eurodollar
Borrowing;
(vi) any portion of a Eurodollar Borrowing that cannot be converted
into or continued as a Eurodollar Borrowing by reason of the immediately
preceding clause shall be automatically converted at the end of the
Interest Period in effect for such Borrowing into an ABR Borrowing; and
(vii) upon notice to the Borrower from the Administrative Agent given
at the request of the Required Lenders, after the occurrence and during
the continuance of a Default or Event of Default, no outstanding Loan may
be converted into, or continued as, a Eurodollar Loan.
Each notice pursuant to this Section 2.10 shall be irrevocable and
shall refer to this Agreement and specify (i) the identity and amount of the
Borrowing that the Borrower requests be converted or continued, (ii) whether
such Borrowing is to be converted to or continued as a Eurodollar Borrowing
or an ABR Borrowing, (iii) if such notice requests a conversion, the date of
such conversion (which shall be a Business Day) and (iv) if such Borrowing is
to be converted to or continued as a Eurodollar Borrowing, the Interest
Period with respect thereto. If no
39
Interest Period is specified in any such notice with respect to any
conversion to or continuation as a Eurodollar Borrowing, the Borrower shall
be deemed to have selected an Interest Period of one month's duration. The
Administrative Agent shall advise the Lenders of any notice given pursuant to
this Section 2.10 and of each Lender's portion of any converted or continued
Borrowing. If the Borrower shall not have given notice in accordance with
this Section 2.10 to continue any Borrowing into a subsequent Interest Period
(and shall not otherwise have given notice in accordance with this Section
2.10 to convert such Borrowing), such Borrowing shall, at the end of the
Interest Period applicable thereto (unless repaid pursuant to the terms
hereof), automatically be continued into a new Interest Period as an ABR
Borrowing.
SECTION 2.11. PREPAYMENT. (a) The Borrower shall have the right at
any time and from time to time to prepay any Borrowing, in whole or in part,
(i) on the last Business Day of a fiscal quarter, upon written or telecopy
notice delivered (or telephone notice promptly confirmed by written or telecopy
notice) to the Administrative Agent before 4:00 p.m., New York City time, on or
before such Business Day, and (ii) in the case of a prepayment on any Business
Day which is not the last Business Day of a fiscal quarter, on at least one (if
a prepayment of an ABR Loan) and three (if a prepayment of a Eurodollar Loan)
Business Days' prior written or telecopy notice (or telephone notice promptly
confirmed by written or telecopy notice) to the Administrative Agent before
2:00 p.m., New York City time; PROVIDED, HOWEVER, that each partial prepayment
shall be in an amount that is an integral multiple of $1,000,000 and not less
than $5,000,000.
(b) In the event of any termination of all the Commitments, the
Borrower shall repay or prepay all its outstanding Borrowings on the date of
such termination. In the event of any partial reduction of the Commitments,
then (i) at or prior to the effective date of such reduction or termination,
the Administrative Agent shall notify the Borrower and the Lenders of the
Total Exposure after giving effect thereto and (ii) if the Total Exposure
would exceed the Total Commitment after giving effect to such reduction or
termination, then the Borrower shall, on the date of such reduction or
termination, repay or prepay then outstanding Loans in an amount sufficient
to eliminate such excess.
(c) Subject to the provisions of Section 5.10(c), if on any date
the Total Exposure shall exceed the Borrowing Base, the Borrower shall on
such date apply an amount equal to such excess to prepay the then outstanding
Loans (if any).
40
(d) Each notice of prepayment shall specify the prepayment date
and the principal amount of each Borrowing (or portion thereof) to be
prepaid, shall be irrevocable and shall commit the Borrower to prepay such
Borrowing by the amount stated therein on the date stated therein. All
prepayments under this Section 2.11 shall be subject to Section 2.14 but
otherwise without premium or penalty. All prepayments under this Section
2.11 shall be accompanied by accrued interest on the principal amount being
prepaid to the date of payment.
SECTION 2.12. RESERVE REQUIREMENTS; CHANGE IN CIRCUMSTANCES. (a)
Notwithstanding any other provision of this Agreement, if after the date of
this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority
charged with the interpretation or administration thereof (whether or not
having the force of law) shall change the basis of taxation of payments to
any Lender or the Issuing Bank of the principal of or interest on any
Eurodollar Loan made by such Lender or any Fees or other amounts payable
hereunder (other than changes in respect of taxes imposed on the overall net
income of such Lender or the Issuing Bank by the jurisdiction in which such
Lender or the Issuing Bank has its principal office or by any political
subdivision or taxing authority therein), or shall impose, modify or deem
applicable any reserve, special deposit or similar requirement against assets
of, deposits with or for the account of or credit extended by any Lender or
the Issuing Bank (except any such reserve requirement which is reflected in
the Adjusted LIBO Rate) or shall impose on such Lender or the Issuing Bank or
the London interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or participation
therein, and the result of any of the foregoing shall be to increase the cost
to such Lender or the Issuing Bank of making or maintaining any Eurodollar
Loan or of issuing or maintaining any Letter of Credit or purchasing or
maintaining a participation therein or to reduce the amount of any sum
received or receivable by such Lender or the Issuing Bank hereunder (whether
of principal, interest or otherwise) by an amount deemed by such Lender or
the Issuing Bank to be material, then the Borrower will pay to such Lender or
the Issuing Bank upon demand such additional amount or amounts as will
compensate such Lender or the Issuing Bank, as the case may be, for such
additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank shall have determined that the
adoption after the date hereof of any law, rule, regulation, agreement or
guideline regarding
41
capital adequacy, or any change after the date hereof in any such law, rule,
regulation, agreement or guideline (whether such law, rule, regulation,
agreement or guideline has been adopted) or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof, or compliance by any Lender (or any
lending office of such Lender) or the Issuing Bank or any Lender's or the
Issuing Bank's holding company with any request or directive regarding
capital adequacy (whether or not having the force of law) of any Governmental
Authority has or would have the effect of reducing the rate of return on such
Lender's or the Issuing Bank's capital or on the capital of such Lender's or
the Issuing Bank's holding company, if any, as a consequence of this
Agreement or the Loans made or participation in Letters of Credit issued by
the Issuing Bank purchased by such Lender pursuant hereto or the Letters of
Credit issued by the Issuing Bank pursuant hereto to a level below that which
such Lender or the Issuing Bank or such Lender's or the Issuing Bank's
holding company could have achieved but for such applicability, adoption,
change or compliance (taking into consideration such Lender's or the Issuing
Bank's policies and the policies of such Lender's or the Issuing Bank's
holding company with respect to capital adequacy) by an amount deemed by such
Lender or the Issuing Bank to be material, then from time to time the
Borrower shall pay to such Lender or the Issuing Bank, as the case may be,
such additional amount or amounts as will compensate such Lender or the
Issuing Bank or such Lender's or the Issuing Bank's holding company for any
such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth
the amount or amounts necessary to compensate such Lender or the Issuing Bank
or its holding company, as applicable, as specified in paragraph (a) or (b)
above shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender or the Issuing Bank the
amount shown as due on any such certificate delivered by it within 10 days
after its receipt of the same. Notwithstanding the foregoing, no Lender nor
the Issuing Bank shall have the right to collect payments from the Borrower
pursuant to paragraph (b) of this Section 2.12 unless it is the policy of
such Lender or the Issuing Bank, at the time of such collection, to collect
similar payments from borrowers (if any) who are similarly situated as the
Borrower, including with respect to credit standing, in connection with
credit facilities similar to those made available pursuant to this Agreement,
where the documents governing such credit facilities establish the right of
such Lender or the Issuing Bank to collect such payments.
42
(d) Failure or delay on the part of any Lender or the Issuing Bank to
demand compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital shall not constitute a waiver of
such Lender's or the Issuing Bank's right to demand such compensation; PROVIDED
that a Lender's or the Issuing Bank's first demand relating to a particular
event or circumstance giving rise to such right shall be made not later than 180
days after such Lender or the Issuing Bank first becomes aware of such event or
circumstance. The protection of this Section shall be available to each Lender
and the Issuing Bank regardless of any possible contention of the invalidity or
inapplicability of the law, rule, regulation, agreement, guideline or other
change or condition that shall have occurred or been imposed.
SECTION 2.13. CHANGE IN LEGALITY. (a) Notwithstanding any other
provision of this Agreement, if, after the date hereof, any change in any law or
regulation or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall make it unlawful
for any Lender to make or maintain any Eurodollar Loan or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Loan, then, by
written notice to the Borrower and to the Administrative Agent:
(i) such Lender may declare that Eurodollar Loans will not thereafter
(for the duration of such unlawfulness) be made by such Lender hereunder
(or be continued for additional Interest Periods and ABR Loans will not
thereafter (for such duration) be converted into Eurodollar Loans), where-
upon any request for a Eurodollar Borrowing (or to convert an ABR Borrowing
to a Eurodollar Borrowing or to continue a Eurodollar Borrowing for an
additional Interest Period) shall, as to such Lender only, be deemed a
request for an ABR Loan (or a request to continue an ABR Loan as such for
an additional Interest Period or to convert a Eurodollar Loan into an ABR
Loan, as the case may be), unless such declaration shall be subsequently
withdrawn; and
(ii) such Lender may require that all outstanding Eurodollar Loans
made by it be converted to ABR Loans, in which event all such Eurodollar
Loans shall be automatically converted to ABR Loans as of the effective
date of such notice as provided in paragraph (b) below.
43
In the event any Lender shall exercise its rights under (i) or (ii) above,
all payments and prepayments of principal that would otherwise have been
applied to repay the Eurodollar Loans that would have been made by such
Lender or the con-verted Eurodollar Loans of such Lender shall instead be
applied to repay the ABR Loans made by such Lender in lieu of, or resulting
from the conversion of, such Eurodollar Loans.
(b) For purposes of this Section 2.13, a notice to the Borrower by
any Lender shall be effective as to each Eurodollar Loan made by such Lender,
if lawful, on the last day of the Interest Period currently applicable to
such Eurodollar Loan; in all other cases such notice shall be effective on
the date of receipt by the Borrower.
SECTION 2.14. INDEMNITY. The Borrower shall indemnify each Lender
against any loss or expense that such Lender may sustain or incur as a conse-
quence of (a) any event, other than a default by such Lender in the performance
of its obligations hereunder, which results in (i) such Lender receiving or
being deemed to receive any amount on account of the principal of any Eurodollar
Loan prior to the end of the Interest Period in effect therefor, (ii) the
conversion of any Eurodollar Loan to an ABR Loan, or the conversion of the
Interest Period with respect to any Eurodollar Loan, in each case other than on
the last day of the Interest Period in effect therefor, or (iii) any Eurodollar
Loan to be made by such Lender (including any Eurodollar Loan to be made
pursuant to a conversion or continuation under Section 2.10) not being made
after notice of such Loan shall have been given by the Borrower hereunder (any
of the events referred to in this clause (a) being called a "BREAKAGE EVENT") or
(b) any default in the making of any payment or prepayment required to be made
hereunder. In the case of any Breakage Event, such loss shall include an amount
equal to the excess, as reasonably determined by such Lender, of (i) its cost of
obtaining funds for the Eurodollar Loan that is the subject of such Breakage
Event for the period from the date of such Breakage Event to the last day of the
Interest Period in effect (or that would have been in effect) for such Loan over
(ii) the amount of interest likely to be realized by such Lender in redeploying
the funds released or not utilized by reason of such Breakage Event for such
period. A certificate of any Lender setting forth any amount or amounts which
such Lender is entitled to receive pursuant to this Section 2.14 shall be
delivered to the Borrower and shall be conclusive absent manifest error.
44
SECTION 2.15. PRO RATA TREATMENT. Except as required under
Section 2.13, each Borrowing, each payment or prepayment of principal of any
Borrowing, each payment of interest on the Loans, each payment of the
Commitment Fees, each reduction of the Commitments and each conversion of any
Borrowing to or continuation of any Borrowing as a Borrowing of any Type
shall be allocated pro rata among the Lenders in accordance with their
respective Applicable Percentages (or, if such Commitments shall have expired
or been terminated, in accordance with the respective principal amounts of
their outstanding Loans). Each Lender agrees that in computing such Lender's
portion of any Borrowing to be made hereunder, the Administrative Agent may,
in its discretion, round each Lender's percentage of such Borrowing to the
next higher or lower whole dollar amount.
SECTION 2.16. SHARING OF SETOFFS. Each Lender agrees that if it
shall, through the exercise of a right of banker's lien, setoff or counterclaim
against the Borrower or any other Loan Party, or pursuant to a secured claim
under Section 506 of Title 11 of the United States Code or other security or
interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, obtain payment (voluntary or involuntary) in
respect of any Loan or Loans or L/C Disbursement as a result of which the unpaid
principal portion of its Loans and participations in L/C Disbursements shall be
proportionately less than the unpaid principal portion of the Loans and
participations in L/C Disbursements of any other Lender, it shall be deemed
simultaneously to have purchased from such other Lender at face value, and shall
promptly pay to such other Lender the purchase price for, a participation in the
Loans and L/C Exposure of such other Lender, so that the aggregate unpaid
principal amount of the Loans and L/C Exposure and participations in Loans and
L/C Exposure held by each Lender shall be in the same proportion to the
aggregate unpaid principal amount of all Loans and L/C Exposure then outstanding
as the principal amount of its Loans and L/C Exposure prior to such exercise of
banker's lien, setoff or counterclaim or other event was to the principal amount
of all Loans and L/C Exposure outstanding prior to such exercise of banker's
lien, setoff or counterclaim or other event; PROVIDED, HOWEVER, that if any such
purchase or purchases or adjustments shall be made pursuant to this Section 2.16
and the payment giving rise thereto shall thereafter be recovered, such purchase
or purchases or adjustment shall be rescinded to the extent of such recovery,
and the purchase price or prices or adjustment shall be restored without
interest. The Borrower expressly consents to the foregoing arrangements and
agrees that any
45
Lender holding a participation in a Loan or L/C Disbursement deemed to have
been so purchased may exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing by the Borrower to such
Lender by reason thereof as fully as if such Lender had made a Loan directly
to the Borrower in the amount of such participation.
SECTION 2.17. PAYMENTS. (a) The Borrower shall make each payment
(including principal of or interest on any Borrowing or any L/C Disbursement
or any Fees or other amounts) hereunder and under any other Loan Document not
later than 1:00 p.m., New York City time, on the date when due in immediately
available dollars, without setoff, defense or counterclaim. Each such
payment (other than Issuing Bank payments, which shall be paid directly to
the Issuing Bank) shall be made to the Administrative Agent at its offices at
000 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
(b) Whenever any payment (including principal of or interest on
any Borrowing or any Fees or other amounts) hereunder or under any other Loan
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day,
and such extension of time shall in such case be included in the computation
of interest or Fees, if applicable.
SECTION 2.18. TAXES. (a) Any and all payments by or on behalf of
the Borrower or any Loan Party hereunder and under any other Loan Document shall
be made, in accordance with Section 2.17, free and clear of and without
deduction for any and all current or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, EXCLUDING
(i) income taxes imposed on the net income of the Administrative Agent,
ny Lender or the Issuing Bank (or any transferee or assignee thereof,
including a participation holder (any such entity a "TRANSFEREE")) and (ii)
franchise taxes imposed on the net income of the Administrative Agent, any
Lender or the Issuing Bank (or Transferee), in each case by the jurisdiction
under the laws of which the Administrative Agent, such Lender or the Issuing
Bank (or Transferee) or its applicable lending office is organized or any
political subdivision thereof (all such nonexcluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities, collectively or
individually, being called "Taxes"). If the Borrower or any Loan Party shall
be required to deduct any Taxes from or in respect of any sum payable
hereunder or under any other Loan Document to the Administrative Agent,
46
a any Lender or the Issuing Bank (or any Transferee), (i) the sum payable
shall be increased by the amount (an "ADDITIONAL AMOUNT") necessary so that,
after all required deductions (including deductions applicable to additional
sums payable under this Section 2.18) are made and any taxes on such
additional amount are paid, the Administrative Agent, such Lender or the
Issuing Bank (or Transferee), as the case may be, shall receive a net amount
equal to the sum it would have received had no such deductions been made,
(ii) the Borrower or such Loan Party shall make such deductions and (iii) the
Borrower or such Loan Party shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower agrees to timely pay to the relevant
Governmental Authority in accordance with applicable law any current or
future stamp or documentary taxes or any other excise, ad valorem, property
or similar taxes, charges or levies (including, without limitation, mortgage
recording taxes and similar fees) that are imposed on or arise from any
payment made hereunder or under any other Loan Document or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement, any Mortgage or any other Loan Document ("Other Taxes").
(c) The Borrower will indemnify the Administrative Agent, each
Lender and the Issuing Bank (or Transferee) for the full amount of Taxes and
Other Taxes paid by the Administrative Agent, such Lender or the Issuing Bank
(or Transferee), as the case may be, and any liability (including penalties,
interest and expenses (including reasonable attorneys' fees and expenses))
arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted by the relevant Governmental
Authority. A certificate as to the amount of such payment or liability
prepared by the Administrative Agent, a Lender or the Issuing Bank (or
Transferee), or the Administrative Agent on its behalf, absent manifest
error, shall be final, conclusive and binding for all purposes. Such
indemnification shall be made within 30 days after the date the
Administrative Agent, any Lender or the Issuing Bank (or Transferee), as the
case may be, makes written demand therefor.
(d) If the Administrative Agent, a Lender or the Issuing Bank (or
Transferee) receives a refund in respect of any Taxes or Other Taxes as to
which it has been indemnified by the Borrower or with respect to which the
Borrower or any other Loan Party has paid additional amounts pursuant to this
Section 2.18, it shall within 30 days from the date of
47
such receipt pay over such refund to the Borrower or such other Loan Party
(but only to the extent of indemnity payments made, or additional amounts
paid, by the Borrower or such other Loan Party under this Section 2.18 with
respect to the Taxes or Other Taxes giving rise to such refund), net of all
out-of-pocket expenses of the Administrative Agent, such Lender or the
Issuing Bank (or Transferee) and without interest (other than interest paid
by the relevant Governmental Authority with respect to such refund);
PROVIDED, HOWEVER, that the Borrower or such other Loan Party, upon the
request of the Administrative Agent, such Lender or the Issuing Bank (or
Transferee), shall repay the amount paid over to the Borrower or such other
Loan Party (plus penalties, interest or other charges) to the Administrative
Agent, such Lender or the Issuing Bank (or Transferee) in the event the
Administrative Agent or such Lender (or Transferee) is required to repay such
refund to such Governmental Authority.
(e) As soon as practicable after the date of any payment of Taxes
or Other Taxes by the Borrower or any other Loan Party to the relevant
Governmental Authority, the Borrower or such other Loan Party will deliver to
the Administrative Agent, or the Issuing Bank, as applicable, at its address
referred to in Section 9.01, the original or a certified copy of a receipt
issued by such Governmental Authority evidencing payment thereof.
(f) Each Lender (or Transferee) that is organized under the laws
of a jurisdiction other than the United States, any State thereof or the
District of Columbia (a "NON-U.S. LENDER") shall deliver to the Borrower and
the Administrative Agent two copies of either United States Internal Revenue
Service Form 1001 or Form 4224, or, in the case of a Non-U.S. Lender claiming
exemption from U.S. Federal withholding tax under Section 871(h) or 881(c) of
the Code with respect to payments of "portfolio interest", a Form W-8, or any
subsequent versions thereof or successors thereto (and, if such Non-U.S.
Lender delivers a Form W-8, a certificate representing that such Non-U.S.
Lender is not a bank for purposes of Section 881(c) of the Code, is not a
10-percent shareholder (within the meaning of Section 871(h)(3)(B) of the
Code) of the Borrower and is not a controlled foreign corporation related to
the Borrower (within the meaning of Section 864(d)(4) of the Code)), properly
completed and duly executed by such Non-U.S. Lender claiming complete
exemption from, or reduced rate of, U.S. Federal withholding tax on payments
by the Borrower under this Agreement and the other Loan Documents. Such
forms shall be delivered by each Non-U.S. Lender on or before the date it
becomes a party to this Agreement (or, in the case
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of a Transferee that is a participation holder, on or before the date such
participation holder becomes a Transferee hereunder) and on or before the
date, if any, such Non-U.S. Lender changes its applicable lending office by
designating a different lending office (a "NEW LENDING OFFICE"). In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such Non-U.S.
Lender. Notwithstanding any other provision of this Section 2.18(f), a
Non-U.S. Lender shall not be required to deliver any form pursuant to this
Section 2.18(f) that such Non-U.S. Lender is not legally able to deliver.
(g) The Borrower shall not be required to indemnify any Non-U.S.
Lender or to pay any additional amounts to any Non-U.S. Lender, in respect of
United States Federal withholding tax pursuant to paragraph (a) or (c) above
to the extent that (i) the obligation to withhold amounts with respect to
United States Federal withholding tax existed on the date such Non-U.S.
Lender became a party to this Agreement (or, in the case of a Transferee that
is a participation holder, on the date such participation holder became a
Transferee hereunder) or, with respect to payments to a New Lending Office,
the date such Non-U.S. Lender designated such New Lending Office with respect
to a Loan; PROVIDED, however, that this paragraph (g) shall not apply (x) to
any Transferee or New Lending Office that becomes a Transferee or New Lending
Office as a result of an assignment, participation, transfer or designation
made at the request of the Borrower and (y) to the extent the indemnity
payment or additional amounts any Transferee, or any Lender (or Transferee),
acting through a New Lending Office, would be entitled to receive (without
regard to this paragraph (g)) do not exceed the indemnity payment or
additional amounts that the person making the assignment, participation or
transfer to such Transferee, or Lender (or Transferee) making the designation
of such New Lending Office, would have been entitled to receive in the
absence of such assignment, participation, transfer or designation or (ii)
the obligation to pay such additional amounts would not have arisen but for a
failure by such Non-U.S. Lender to comply with the provisions of paragraph
(f) above.
(h) Nothing contained in this Section 2.18 shall require any Lender
or the Issuing Bank (or any Transferee) or the Administrative Agent to make
available any of its tax returns (or any other information that it deems to be
confidential or proprietary).
SECTION 2.19. ASSIGNMENT OF COMMITMENTS UNDER CERTAIN CIRCUMSTANCES;
DUTY TO MITIGATE. (a) In the event
49
(i) any Lender or the Issuing Bank delivers a certificate requesting
compensation pursuant to Section 2.12, (ii) any Lender or the Issuing Bank
delivers a notice described in Section 2.13 or (iii) the Borrower is required
to pay any additional amount to any Lender or the Issuing Bank (or any
Transferee) or any Governmental Authority on account of any Lender or the
Issuing Bank (or any Transferee) pursuant to Section 2.18, the Borrower may,
at its sole expense and effort (including with respect to the processing and
recordation fee referred to in Section 9.04(b)), upon notice to such Lender
or the Issuing Bank (or such Transferee) and the Administrative Agent,
require such Lender or the Issuing Bank (or such Transferee) to transfer and
assign, without recourse (in accordance with and subject to the restrictions
contained in Section 9.04), all of its interests, rights and obligations
under this Agreement to an assignee that shall assume such assigned
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (x) such assignment shall not conflict with any
law, rule or regulation or order of any court or other Governmental Authority
having jurisdiction, (y) the Borrower shall have received the prior written
consent of the Administrative Agent (and, if a Commitment is being assigned,
of the Issuing Bank), which consent shall not unreasonably be withheld, and
(z) the Borrower or such assignee shall have paid to the affected Lender or
the Issuing Bank (or Transferee) in immediately available funds an amount
equal to the sum of the principal of and interest accrued to the date of such
payment on the outstanding Loans and participations in L/C Disbursements of
such Lender or the Issuing Bank (or Transferee) plus all Fees and other
amounts accrued for the account of such Lender or the Issuing Bank (or
Transferee) hereunder (including any amounts under Section 2.12 and Section
2.14); provided further that, if prior to any such transfer and assignment
the circumstances or event that resulted in such Lender's or the Issuing
Bank's (or such Transferee's) claim for compensation under Section 2.12 or
notice under Section 2.13 or the amounts paid pursuant to Section 2.18, as
the case may be, cease to cause such Lender or the Issuing Bank to suffer
increased costs or reductions in amounts received or receivable or reduction
in return on capital, or cease to have the consequences specified in Section
2.13, or cease to result in amounts being payable under Section 2.18, as the
case may be (including as a result of any action taken by such Lender or the
Issuing Bank (or such Transferee) pursuant to paragraph (b) below), or if
such Lender or the Issuing Bank (or such Transferee) shall waive its right to
claim further compensation under Section 2.12 in respect of such
circumstances or event or shall withdraw its notice under Section 2.13 or
shall waive its right to further
50
payments under Section 2.18 in respect of such circumstances or event, as the
case may be, then such Lender or the Issuing Bank (or such Transferee) shall
not thereafter be required to make any such transfer and assignment
hereunder. In the case of any such assignment by an Issuing Bank, such
assignment shall not affect the Issuing Bank's rights or obligations under
this Agreement in respect of any Letters of Credit issued by it that remain
outstanding and held by such Issuing Bank. Notwithstanding the foregoing,
the Borrower shall not have the right to require under this Section 2.19(a) a
transfer or assignment by a Lender or the Issuing Bank that has (i) requested
compensation pursuant to Section 2.12, (ii) delivered a notice described in
Section 2.13 or (iii) required payment of any additional amount pursuant to
Section 2.18, if at such time there is (A) any other Lender or the Issuing
Bank that has requested compensation pursuant to Section 2.12 or that has
required payment of any additional amount pursuant to Section 2.18, in either
case in an amount as great or greater than the compensation or additional
amounts requested or required by such first Lender or the Issuing Bank, or
(B) any other Lender that has delivered a notice described in Section 2.13,
as the case may be, and the Borrower is not concurrently or has not
previously required a transfer or assignment by such other Lender or the
Issuing Bank.
(b) If (i) any Lender or the Issuing Bank shall request
compensation under Section 2.12, (ii) any Lender or the Issuing Bank delivers
a notice described in Section 2.13 or (iii) the Borrower is required to pay
any additional amount to any Lender or the Issuing Bank (or Transferee) or
any Governmental Authority on account of any Lender or the Issuing Bank (or
Transferee), pursuant to Section 2.18, then such Lender or the Issuing Bank
(or Transferee) shall use reasonable efforts (which shall not require such
Lender or the Issuing Bank (or Transferee) to incur an unreimbursed loss or
unreimbursed cost or expense or otherwise take any action inconsistent with
its internal policies or legal or regulatory restrictions or suffer any
disadvantage or burden deemed by it to be significant) (x) to file any
certificate or document reasonably requested in writing by the Borrower or
(y) to assign its rights and delegate and transfer its obligations hereunder
to another of its offices, branches or affiliates, if such filing or
assignment would reduce its claims for compensation under Section 2.12 or
enable it to withdraw its notice pursuant to Section 2.13 or would reduce
amounts payable pursuant to Section 2.18, as the case may be, in the future.
The Borrower hereby agrees to pay all reasonable costs and expenses incurred
by any Lender or the Issuing Bank (or Transferee) in connection with any such
filing or assignment, delegation and transfer.
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SECTION 2.20. LETTERS OF CREDIT. (a) General. Provided no
Default or Event of Default exists at such time, the Borrower may, subject to
the terms and conditions in this Agreement, request from time to time the
issuance of a Letter or Letters of Credit, in a form reasonably acceptable to
the Administrative Agent and the Issuing Bank, appropriately completed, for
the account of the Borrower, at any time and from time to time while the
Commitments remain in effect. This Section shall not be construed to impose
an obligation upon the Issuing Bank to issue any Letter of Credit that is
inconsistent with the terms and conditions of this Agreement.
(b) NOTICE OF ISSUANCE, AMENDMENT, RENEWAL, EXTENSION; CERTAIN
CONDITIONS. In order to request the issuance of a Letter of Credit (or to
amend, renew or extend an existing Letter of Credit), the Borrower shall hand
deliver or telecopy to the Issuing Bank and the Administrative Agent
(reasonably in advance of the requested date of issuance, amendment, renewal
or extension) a notice requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, the date
of issuance, amendment, renewal or extension, the date on which such Letter
of Credit is to expire (which shall comply with paragraph (c) below), the
amount of such Letter of Credit, the name and address of the beneficiary
thereof and such other information as shall be necessary to prepare such
Letter of Credit. In connection with a request for the issuance of a Letter
of Credit, the Issuing Bank may require the Borrower to submit an application
in such form as may be customarily employed by the Issuing Bank, but in the
event of any inconsistency between the terms thereof and the provisions of
this Agreement, the provisions of this Agreement shall be controlling.
Following receipt of such notice and prior to the issuance of the requested
Letter of Credit or the applicable amendment, renewal or extension, the
Administrative Agent shall notify the Borrower and the Issuing Bank of the
amount of the Total Credit Exposure after giving effect to (i) the issuance,
amendment, renewal or extension of such Letter of Credit, (ii) the issuance
or expiration of any other Letter of Credit that is to be issued or will
expire prior to the requested date of issuance of such Letter of Credit and
(iii) the borrowing or repayment of any Loans that (based upon notices
delivered to the Administrative Agent by the Borrower) are to be borrowed or
repaid prior to the requested date of issuance of such Letter of Credit. A
Letter of Credit shall be issued, amended, renewed or extended only if, and
upon issuance, amendment, renewal or extension of each Letter of Credit the
Borrower shall be deemed to represent and warrant that,
52
after giving effect to such issuance, amendment, renewal or extension (A) the
L/C Exposure shall not exceed $10,000,000, and (B) the Total Exposure shall
not exceed the Total Commitment. Promptly following the end of each month,
the Administrative Agent shall notify the Lenders of the L/C Exposure as of
the end of such month.
(c) EXPIRATION DATE. Each Letter of Credit shall expire at or prior
to the close of business on the date that is fifteen Business Days prior to the
Maturity Date or, if such Letter of Credit is a commercial letter of credit, the
earlier of such date and 180 days after the date of issuance of such Letter of
Credit.
(d) PARTICIPATIONS. By the issuance of a Letter of Credit and
without any further action on the part of the Issuing Bank or the Lenders, the
Issuing Bank hereby grants to each Lender, and each such Lender hereby acquires
from the applicable Issuing Bank, a participation in such Letter of Credit equal
to such Lender's Applicable Percentage of the aggregate amount available to be
drawn under such Letter of Credit, effective upon the issuance of such Letter of
Credit. In consideration and in furtherance of the foregoing, each Lender
hereby absolutely and unconditionally agrees to pay to the Administrative Agent,
for the account of the Issuing Bank, such Lender's Applicable Percentage of each
L/C Disbursement made by the Issuing Bank and not reimbursed by the Borrower
(or, if applicable, another party pursuant to its obligations under any other
Loan Document) forthwith on the date due as provided in Section 2.02(f). Each
Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or an Event of Default,
and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever; PROVIDED, HOWEVER, that the foregoing shall
not be construed to impose an obligation of the Lenders to reimburse an L/C
Disbursement that the Borrower is not required to reimburse due to the gross
negligence or wilful misconduct of the Issuing Bank (determined as provided in
Section 2.20(f)).
(e) REIMBURSEMENT. If the Issuing Bank shall make any L/C
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such
L/C Disbursement by paying an amount equal to such L/C Disbursement to the
Administrative Agent not later than 12:00 noon, New York City time on the date
that such L/C Disbursement is made or, if the Borrower shall have received
notice of such L/C Disbursement later than 10:00 a.m., New York City time, on
53
the date that such L/C Disbursement is made, not later than 12:00 noon, New
York City time, on the immediately following Business Day; PROVIDED that if
such reimbursement is not so made, then the payment in the amount of such L/C
Disbursement shall automatically be financed with ABR Loans as contemplated
by Section 2.02(f) and, to the extent such payment is so financed with ABR
Loans in accordance with Section 2.02(f), such payment shall not be required
to be made by the Borrower under this Section 2.20(e).
(f) Obligations Absolute. The Borrower's obligations to reimburse
L/C Disbursements as provided in paragraph (e) above 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,
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, setoff, defense or other right that
the Borrower, any other party guaranteeing, or otherwise obligated with,
the Borrower, any Subsidiary or other Affiliate thereof or any other person
may at any time have against the beneficiary under any Letter of Credit,
the Issuing Bank, 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 Issuing Bank 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 the
Issuing Bank, 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
54
the provisions of this Section, constitute a legal or equitable discharge
of the Borrower's obligations hereunder;
PROVIDED that the foregoing shall not be construed to impose an obligation upon
the Borrower to reimburse the Issuing Bank to the extent that neither the
Borrower nor any Subsidiary received any benefit from such L/C Disbursement as a
direct result of the Issuing Bank's gross negligence or wilful misconduct in
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof; it is understood that the Issuing Bank may
accept documents that are on their face 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 (A) the Issuing Bank's
exclusive reliance 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 (B) 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 wilful misconduct or gross negligence of the Issuing
Bank.
(g) Disbursement Procedures. The Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall as promptly
as possible give telephonic notification, confirmed by telecopy, to the
Administrative Agent and the Borrower of such demand for payment and whether the
Issuing Bank has made or will make an L/C Disbursement thereunder; PROVIDED that
any failure to give or delay in giving such notice shall not relieve the
Borrower of its obligation to reimburse the Issuing Bank and the Lenders with
respect to any such L/C Disbursement. The Administrative Agent shall promptly
give each Lender notice thereof.
(h) INTERIM INTEREST. If the Issuing Bank shall make any L/C
Disbursement in respect of a Letter of Credit, then, unless the Borrower shall
reimburse such L/C
55
Disbursement in full not later than 12:00 noon, New York City time, on the
date that such L/C Disbursement is made, the unpaid amount thereof shall bear
interest, for each day from and including the date of such L/C Disbursement
to but excluding the earlier to occur of (i) the date of payment and (ii) the
date such L/C Disbursement is financed by ABR Loans, in accordance with
Sections 2.02(f) and 2.20(e), at the Alternate Base Rate; PROVIDED that to
the extent that such L/C Disbursement is not reimbursed by the Borrower prior
to 12:00 (noon), New York City time, on the third Business Day after the date
such L/C Disbursement is made and is not financed with ABR Loans in
accordance with Sections 2.02(f) and 2.20(e), then such unpaid amount shall
bear interest from and including such third Business Day to but excluding the
date of payment as provided in Section 2.07.
(i) RESIGNATION OR REMOVAL OF THE ISSUING BANK. The Issuing Bank may
resign at any time by giving 180 days' prior written notice to the
Administrative Agent, the Lenders and the Borrower, provided a successor Issuing
Bank is designated on or prior to such resignation, and may be removed at any
time by the Borrower by notice to the Issuing Bank, the Administrative Agent and
the Lenders. Subject to the last sentence of this paragraph, upon the
acceptance of any appointment as the Issuing Bank hereunder by a successor
Issuing Bank, such successor shall succeed to and become vested with all the
interests, rights and obligations of the retiring Issuing Bank and the retiring
Issuing Bank shall be discharged from its obligations to issue additional
Letters of Credit hereunder. At the time such removal or resignation shall
become effective, the Borrower shall pay all accrued and unpaid Issuing Bank
Fees. The acceptance of any appointment as the Issuing Bank hereunder by a
successor Lender shall be evidenced by an agreement entered into by such
successor, in a form satisfactory to the Borrower and the Administrative Agent,
and, from and after the effective date of such agreement, (i) such successor
Lender shall have all the rights and obligations of the previous Issuing Bank
under this Agreement and the other Loan Documents and (ii) references herein and
in the other Loan Documents to the term "Issuing Bank" shall be deemed to refer
to such successor or to any previous Issuing Bank, or to such successor and all
previous Issuing Banks, as the context shall require. After the resignation or
removal of the Issuing Bank hereunder, the retiring Issuing Bank shall remain a
party hereto and shall continue to have all the rights and obligations of an
Issuing Bank under this Agreement and the other Loan Documents with respect to
Letters of Credit issued by it prior to such resignation or
56
removal, but shall not be required to issue additional Letters of Credit.
(j) CASH COLLATERALIZATION. If any Event of Default shall occur and
be continuing, the Borrower shall, on the Business Day it receives notice from
the Administrative Agent or the Required Lenders thereof (such notice to include
the amount to be deposited), deposit in an account with the Collateral Agent,
for the benefit of the Lenders, an amount in cash equal to the L/C Exposure as
of such date. Such deposit shall be held by the Collateral Agent as collateral
for the payment and performance of the Obligations. The Collateral Agent shall
have exclusive dominion and control, including the exclusive right of
withdrawal, over such account. Other than any interest earned on the investment
of such deposits in Cash Equivalents, which investments shall be made at the
option and sole discretion of the Collateral Agent, such deposits shall not bear
interest. Interest or profits, if any, on such investments shall accumulate in
such account. Moneys in such account shall (i) automatically be applied by the
Administrative Agent to reimburse the Issuing Bank for L/C Disbursements for
which it has not been reimbursed, (ii) be held for the satisfaction of the
reimbursement obligations of the Borrower for the L/C Exposure at such time and
(iii) if the maturity of the Loans has been accelerated, be applied to satisfy
the Obligations. If the Borrower is required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured
or waived.
(k) ADDITIONAL ISSUING BANKS. The Borrower may, at any time and from
time to time with the consent of the Administrative Agent (which consent shall
not be unreasonably withheld) and such Lender, designate one or more additional
Lenders to act as an issuing bank under the terms of this Agreement. Any Lender
designated as an issuing bank pursuant to this paragraph (k) shall be deemed to
be an "Issuing Bank" (in addition to being a Lender) in respect of Letters of
Credit issued or to be issued by such Lender, and, with respect to any Letter of
Credit, such term shall thereafter apply to the Issuing Bank that shall have
issued such Letter of Credit.
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58
ARTICLE III. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Administrative Agent, the
Collateral Agent, the Issuing Bank and each of the Lenders that:
SECTION 3.01. ORGANIZATION; POWERS. Each of the Borrower and each of
the Subsidiaries (a) is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization, (b) has
all requisite power and authority to own its property and assets and to carry on
its business as now conducted and as proposed to be conducted, (c) is qualified
to do business in, and is in good standing in, every jurisdiction where such
qualification is required, except where the failure so to qualify could not
reasonably be expected to result in a Material Adverse Effect, and (d) has the
corporate power and authority to execute, deliver and perform its obligations
under each of the Loan Documents and each other agreement or instrument
contemplated hereby to which it is or will be a party and, in the case of the
Borrower, to borrow hereunder.
SECTION 3.02. AUTHORIZATION. The execution, delivery and performance
by each Loan Party of each of the Loan Documents and the borrowings hereunder
(collectively, the "TRANSACTIONS") (a) have been or will as of the Closing Date
be duly authorized by all requisite corporate and, if required, stockholder
action and (b) will not (i) violate (A) any provision of law, statute, rule or
regulation, or of the certificate or articles of incorporation or other
constitutive documents or by-laws of the Borrower or any Subsidiary, (B) any
order of any Governmental Authority or (C) any provision of any indenture,
agreement or other instrument to which the Borrower or any Subsidiary is a party
or by which any of them or any of their property is or may be bound, (ii) be in
conflict with, result in a breach of or constitute (alone or with notice or
lapse of time or both) a default under, or give rise to any right to accelerate
or to require the prepayment, repurchase or redemption of any obligation under
any such indenture, agreement or other instrument or (iii) result in the crea-
tion or imposition of any Lien upon or with respect to any property or assets
now owned or hereafter acquired by the Borrower or any Subsidiary (other than
any Lien created under the Security Documents).
SECTION 3.03. ENFORCEABILITY. This Agreement has been duly executed
and delivered by the Borrower and constitutes, and each other Loan Document when
executed and delivered by the each Loan Party thereto will constitute, a legal,
valid and binding obligation of such Loan Party
58
enforceable against such Loan Party in accordance with its terms, except as
may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or limiting creditors' rights generally or by
equitable principles relating to enforceability.
SECTION 3.04. GOVERNMENTAL APPROVALS. From and after the Closing
Date, no action, consent or approval of, registration or filing with or any
other action by any Governmental Authority will be required in connection with
the Transactions, except for (a) the filing of Uniform Commercial Code financing
statements, (b) the filing of Forms D-37, (c) recordation of the Mortgages and
the Mortgage Amendments and (d) such as have been made or obtained and are in
full force and effect.
SECTION 3.05. FINANCIAL STATEMENTS. The Borrower has heretofore
furnished to the Lenders its consolidated balance sheets and statements of
operations and cash flows as of and for the fiscal year ended December 31, 1996,
to be audited by and accompanied by the opinion of Xxxxxx Xxxxxxxx LLP,
independent public accountants. The Financial Statements present fairly the
financial condition and results of operations and cash flows of the Borrower and
its consolidated Subsidiaries as of such dates and for such periods. The
balance sheets and the notes thereto included in the Financial Statements dis-
close all material liabilities, direct or contingent, of the Borrower and its
consolidated Subsidiaries as of the dates thereof. The financial statements
included in the Financial Statements were prepared in accordance with GAAP
applied on a consistent basis.
SECTION 3.06. NO MATERIAL ADVERSE CHANGE. There has been no material
adverse change in the business, assets, operations or financial condition of the
Borrower and the Subsidiaries and their predecessors operations, taken as a
whole, since December 31, 1996.
SECTION 3.07. TITLE TO PROPERTIES; POSSESSION UNDER LEASES. (a) On
and after the Closing Date, each of the Borrower and the Subsidiaries will have
good and marketable title to, or valid leasehold interests in, all its material
properties and assets (including all Mortgaged Property), except for minor
defects in title that do not interfere with its ability to conduct its business
as currently conducted or to utilize such properties and assets for their
intended purposes. On and after the Closing Date, all such material properties
and assets will be free and clear of Liens, other than Liens expressly permitted
by Section 6.02.
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(b) On and after the Closing Date each of the Borrower and the
Subsidiaries will have complied with all material obligations under all material
leases to which it is a party, and all such leases will be in full force and
effect. On and after the Closing Date each of the Borrower and the Subsidiaries
will enjoy peaceful and undisturbed possession under all such material leases.
(c) As of the Closing Date, except as set forth on Schedule 3.07(c),
the Borrower shall not have received any notice of, nor have any knowledge of,
any pending or contemplated condemnation proceeding affecting the Mortgaged
Properties or any sale or disposition thereof in lieu of condemnation.
(d) As of the Closing Date, except as set forth on Schedule 3.07(d),
the Borrower shall not be obligated under any right of first refusal, option or
other contractual right to sell, assign or otherwise dispose of any Mortgaged
Property or any interest therein.
SECTION 3.08. SUBSIDIARIES. Schedule 3.08 sets forth as of the
Closing Date a list of all Subsidiaries and the percentage ownership interest of
the Borrower therein. As of the Closing Date, the shares of capital stock will
be fully paid and non-assessable and such shares and other ownership interests
so indicated by Schedule 3.08 will be owned by the Borrower, directly or
indirectly, free and clear of all Liens.
SECTION 3.09. LITIGATION; COMPLIANCE WITH LAWS. (a) Except as set
forth on Schedule 3.09, there are not any actions, suits or proceedings at law
or in equity or by or before any Governmental Authority pending or, to the
knowledge of the Borrower, threatened against or affecting the Borrower or any
Subsidiary or any business, property or rights of any such person (i) that seek
to enjoin, invalidate or rescind any Loan Document or the Transactions or
(ii) as to which there is a reasonable possibility of an adverse determination
and that, if adversely determined, could reasonably be expected, individually or
in the aggregate, to result in a Material Adverse Effect.
(b) None of the Borrower or any of the Subsidiaries or any of their
respective material properties or assets is in violation of, nor will the
continued operation of their material properties and assets as currently or then
conducted violate, any law, rule or regulation (including any zoning, building,
Environmental Law, ordinance, code or approval or any building permits) or any
restrictions of record or agreements affecting the Mortgaged Property, or is
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in default with respect to any judgment, writ, injunction, decree or order of
any Governmental Authority, where such violation or default could reasonably
be expected to result in a Material Adverse Effect.
(c) All certificates of occupancy and permits necessary for the
operation and use of each Mortgaged Property as currently constructed are in
effect for such Mortgaged Property, and true and complete copies of all such
certificates of occupancy (or other evidence satisfactory to the Administrative
Agent in its sole discretion that such certificates of occupancy have been
issued) have been delivered to the Collateral Agent as mortgagee with respect to
each Mortgaged Property.
SECTION 3.10. AGREEMENTS. (a) Neither the Borrower nor any of the
Subsidiaries is a party to any agreement or instrument or subject to any
corporate restriction that has resulted or could reasonably be expected to
result in a Material Adverse Effect.
(b) Neither the Borrower nor any of the Subsidiaries is in default in
any manner under any provision of any indenture or other agreement or instrument
evidencing Indebtedness, or any other material agreement or instrument to which
it is a party or by which it or any of its properties or assets are or may be
bound, where such default could reasonably be expected to result in a Material
Adverse Effect.
SECTION 3.11. FEDERAL RESERVE REGULATIONS. (a) Neither the
Borrower nor any of the Subsidiaries is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
buying or carrying Margin Stock.
(b) No part of the proceeds of any Loan will be used, whether
directly or indirectly, and whether immediately, incidentally or ultimately, for
any purpose that entails a violation of, or that is inconsistent with, the
provisions of the Regulations of the Board, including Regulation G, U or X.
SECTION 3.12. INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING COMPANY
ACT. Neither the Borrower nor any Subsidiary is (a) an "investment company" as
defined in, or subject to regulation under, the Investment Company Act of 1940
or (b) a "holding company" as defined in, or subject to regulation under, the
Public Utility Holding Company Act of 1935.
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SECTION 3.13. USE OF PROCEEDS. The Borrower will use the proceeds of
the Loans and request the issuance of Letters of Credit only for the purposes
specified in the preamble to this Agreement.
SECTION 3.14. TAX RETURNS. Each of the Borrower and the Subsidiaries
has timely filed or caused to be timely filed all Federal, state, local and
foreign tax returns, reports and other materials required to have been filed by
it and has timely paid or caused to be timely paid all taxes shown thereon to be
due and payable by it and all assessments or notices of deficiency received by
it, except any taxes, assessments or notices of deficiency that are being
contested in good faith by appropriate proceedings and for which the Borrower or
such Subsidiary, as applicable, shall have set aside on its books adequate
reserves in accordance with GAAP. Neither the Borrower nor any of the
Subsidiaries is a party to, or has any obligation under, any tax sharing
agreement (other than Article 6 of the Allocation Agreement) with Xxxx, any
Affiliate of Xxxx or any other person (other than any such agreement solely
among the Borrower and any Subsidiary or among two or more of the
Subsidiaries).
SECTION 3.15. NO MATERIAL MISSTATEMENTS. No other information,
report, financial statement, exhibit or schedule furnished by or on behalf of
the Borrower to the Administrative Agent or any Lender in connection with the
negotiation of any Loan Document or included therein or delivered pursuant
thereto contained, contains or will contain any material misstatement of fact or
omitted, omits or will omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were, are
or will be made, not misleading; provided that to the extent any such
information, report, financial statement, exhibit or schedule was based upon or
constitutes a forecast or projection, the Borrower makes no representation as to
such forecast or projection.
SECTION 3.16. EMPLOYEE BENEFIT PLANS. Each of the Borrower and its
ERISA Affiliates is in compliance in all material respects with the applicable
provisions of ERISA and the Code and the regulations and published
interpretations thereunder. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events,
could reasonably be expected to result in material liability of the Borrower or
any of its ERISA Affiliates. The present value of all benefit liabilities under
each Plan (based on those assumptions used to fund such Plan) did not, as of the
last annual valuation date applicable thereto, exceed by more
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than $5,000,000 the fair market value of the assets of such Plan, and the
present value of all benefit liabilities of all underfunded Plans (based on
those assumptions used to fund each such Plan) did not, as of the last annual
valuation dates applicable thereto, exceed by more than $5,000,000 the fair
market value of the assets of all such underfunded Plans.
SECTION 3.17. ENVIRONMENTAL MATTERS. Except as set forth in Schedule
3.17:
(a) The properties owned or operated by the Borrower and the
Subsidiaries (the "PROPERTIES") do not contain any Hazardous Materials in
amounts or concentrations which (i) constitute a violation of, or (ii) could
give rise to liability under, Environmental Laws, which violations and
liabilities, in the aggregate, could reasonably be expected to result in a
Material Adverse Effect;
(b) The Properties and all operations of the Borrower and the
Subsidiaries are in compliance with all Environmental Laws and all necessary
Environmental Permits have been obtained and are in effect, except to the extent
that such noncompliance or failure to obtain any necessary permits, in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect;
(c) There have been no Releases or threatened Releases at, from, under
or proximate to the Properties or otherwise in connection with the operations of
the Borrower or the Subsidiaries, which Releases or threatened Releases, in the
aggregate, could reasonably be expected to result in a Material Adverse Effect;
(d) Neither the Borrower nor any of the Subsidiaries has received any
notice of an Environmental Claim in connection with the Properties or the
operations of the Borrower or the Subsidiaries or with regard to any person
whose liabilities for environmental matters the Borrower or the Subsidiaries has
retained or assumed, in whole or in part, contractually, by operation of law or
otherwise, which, in the aggregate, could reasonably be expected to result in a
Material Adverse Effect, nor do the Borrower or the Subsidiaries have reason to
believe that any such notice will be received or is being threatened;
(e) Hazardous Materials have not been transported from the Properties,
nor have Hazardous Materials been generated, treated, stored or disposed of at,
on or under any of the Properties in a manner that could reasonably be expected
to give rise to liability under any Environmental
63
Law, nor have the Borrower or the Subsidiaries retained or assumed any
liability, contractually, by operation of law or otherwise, with respect to
the generation, treatment, storage or disposal of Hazardous Materials, which
transportation, generation, treatment, storage or disposal, or retained or
assumed liabilities, in the aggregate, could reasonably be expected to result
in a Material Adverse Effect.
SECTION 3.18. INSURANCE. Schedule 3.18 sets forth a true, complete
and correct description of all insurance that will be maintained by the Borrower
or by the Borrower for its Subsidiaries as of the Closing Date. As of the
Closing Date, such insurance will be in full force and effect, and no premiums
will be due but unpaid. On and after the Closing Date, the Borrower and its
Subsidiaries will have insurance in such amounts and covering such risks and
liabilities as are in accordance with normal industry practice.
SECTION 3.19. SECURITY DOCUMENTS. (a) The Pledge Agreement is
effective to create in favor of the Collateral Agent, for the ratable benefit of
the Secured Parties, a legal, valid and enforceable security interest in the
Collateral (as defined in the Pledge Agreement) and, when the Collateral is
delivered to the Collateral Agent and all Uniform Commercial Code financing
statements are filed in the offices specified on Schedule 4.02(h), the Pledge
Agreement shall constitute a fully perfected first priority Lien on, and
security interest in, all right, title and interest of the pledgors thereunder
in such Collateral, in each case prior and superior in right to any other
person.
(b) The Mortgages are effective to create in favor of the Collateral
Agent, for the ratable benefit of the Secured Parties, a legal, valid and
enforceable Lien on all of the Loan Parties' right, title and interest in and to
the Mortgaged Property thereunder and the proceeds thereof, and when the
Mortgages are filed in the offices specified on Schedule 4.02(h), the Mortgages
shall constitute a fully perfected Lien on, and security interest in, all right,
title and interest of the Loan Parties in such Mortgaged Property and the
proceeds thereof, in each case prior and superior in right to any other person,
other than with respect to the rights of persons pursuant to Liens expressly
permitted by Section 6.02.
SECTION 3.20. LABOR MATTERS. As of the date hereof and the Closing
Date, there are no strikes, lockouts or slowdowns against the Borrower or any
Subsidiary pending
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or, to the knowledge of the Borrower, threatened. The hours worked by and
payments made to employees of the Borrower and the Subsidiaries have not been
in material violation of the Fair Labor Standards Act or any other applicable
Federal, state, local or foreign law dealing with such matters. All payments
due from the Borrower or any Subsidiary, or for which any claim may be made
against the Borrower or any Subsidiary, on account of wages and employee
health and welfare insurance and other benefits, have been paid or accrued as
a liability on the books of the Borrower or such Subsidiary through the end
of the most-recent fiscal quarter of the Borrower or such Subsidiary as to
which financial statements have been delivered to the Lenders. The
consummation of the Transactions, the Formation and the Distribution will not
give rise to any right of termination or right of renegotiation on the part
of any union under any collective bargaining agreement to which the Borrower
or any Subsidiary is bound.
SECTION 3.21. SOLVENCY. (a) Immediately following the making of
each Loan and after giving effect to the application of the proceeds of such
Loans, and immediately after the issuance of each Letter of Credit, (i) the fair
value of the assets of each Loan Party, at a fair valuation, will exceed its
debts and liabilities, subordinated, contingent or otherwise; (ii) the present
fair saleable value of the property of each Loan Party will be greater than the
amount that will be required to pay the probable liability of its debts and
other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured; (iii) each Loan Party does not
intend to incur and does not believe it will incur debts and liabilities,
subordinated, contingent or otherwise, beyond its ability to pay such debts and
liabilities as they become absolute and matured; and (iv) each Loan Party will
not have unreasonably small capital with which to conduct the business in which
it is engaged as such business is now conducted and is proposed to be conducted
following the Closing Date.
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ARTICLE IV. CONDITIONS OF LENDING
The obligations of the Lenders to make Loans and of the Issuing Bank
to issue Letters of Credit hereunder are subject to the satisfaction of the
following conditions:
SECTION 4.01. ALL CREDIT EVENTS. On the date of each Borrowing and
on the date of each issuance of a Letter of Credit (each such date, a "CREDIT
EVENT"):
(a) The Administrative Agent shall have received a notice of such
Borrowing as required by Section 2.03 or 2.10 (or such notice shall have
been deemed given in accordance with Section 2.03 or 2.10) or, in the case
of the issuance of a Letter of Credit, the Issuing Bank and the
Administrative Agent shall have received a notice requesting the issuance
of such Letter of Credit as required by Section 2.20(b).
(b) Except in the case of a Borrowing that does not increase the
aggregate principal amount of Loans outstanding of any Lender, the
representations and warranties set forth in Article III hereof shall be
true and correct in all material respects on and as of the date of such
Credit Events 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.
(c) Except in the case of a Borrowing that does not increase the
aggregate principal amount of Loans outstanding of any Lender, the Borrower
and each other Loan Party shall be in compliance with all the terms and
provisions set forth herein and in each other Loan Document on its part to
be observed or performed, and at the time of and immediately after such
Credit Event, no Event of Default or Default shall have occurred and be
continuing.
Each Credit Event (except as aforesaid) shall be deemed to constitute a
representation and warranty by the Borrower on the date of such Credit Event as
to the matters specified in paragraphs (b) and (c) of this Section 4.01.
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SECTION 4.02. EFFECTIVENESS. On the Closing Date:
(a) The Administrative Agent shall have received, on behalf of itself
and the Lenders, a favorable written opinion of (i) O'Melveny & Xxxxx,
counsel for the Borrower, substantially to the effect set forth in Exhibit
G-1, (ii) Goodsill, Anderson, Xxxxx & Xxxxxx, special Hawaii counsel for
the Borrower, substantially to the effect set forth in Exhibit G-2 and
(iii) each local counsel listed on Schedule 4.02(a), substantially to the
effect set forth in Exhibit G-3, in each case (A) dated the Closing Date,
(B) addressed to the Administrative Agent and the Lenders, and (C) covering
such other matters relating to the Loan Documents and the Transactions as
the Administrative Agent shall reasonably request, and the Borrower hereby
requests such counsel to deliver such opinions.
(b) All legal matters incident to this Agreement, the Borrowings and
extensions of credit hereunder and the other Loan Documents shall be
satisfactory to the Lenders, the Issuing Bank and to Rosenman & Colin LLP,
counsel for the Administrative Agent.
(c) The Administrative Agent shall have received (i) a copy of the
certificate or articles of incorporation, including all amendments thereto,
of each Loan Party, certified as of a recent date by the Secretary of State
of the state of its organization, and a certificate as to the good standing
of each Loan Party as of a recent date, from such Secretary of State;
(ii) a certificate of the Secretary or Assistant Secretary of each Loan
Party dated the Closing Date and certifying (A) that attached thereto is a
true and complete copy of the by-laws of such Loan Party as in effect on
the Closing Date and at all times since a date prior to the date of the
resolutions described in clause (B) below, (B) that attached thereto is a
true and complete copy of resolutions duly adopted by the Board of
Directors of such Loan Party authorizing the execution, delivery and
performance of the Loan Documents to which such person is a party and, in
the case of the Borrower, the borrowings hereunder, and that such
resolutions have not been modified, rescinded or amended and are in full
force and effect, (C) that the certificate or articles of incorporation of
such Loan Party have not been amended since the date of the
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last amendment thereto shown on the certificate of good standing
furnished pursuant to clause (i) above, and (D) as to the incumbency and
specimen signature of each officer executing any Loan Document or any
other document delivered in connection herewith on behalf of such Loan
Party; (iii) a certificate of another officer as to the incumbency and
specimen signature of the Secretary or Assistant Secretary executing the
certificate pursuant to (ii) above; and (iv) such other documents as the
Lenders or Rosenman & Colin LLP, counsel for the Administrative Agent,
may reasonably request.
(d) The Administrative Agent shall have received a certificate, dated
the Closing Date and signed by a Financial Officer of the Borrower,
confirming compliance with the conditions precedent set forth in
paragraphs (b) and (c) of Section 4.01.
(e) The Administrative Agent shall have received all Fees and other
amounts due and payable on or prior to the Closing Date, including, to the
extent invoiced, reimbursement or payment of all reasonable out-of-pocket
expenses required to be reimbursed or paid by the Borrower hereunder or
under any other Loan Document.
(f) The Pledge Agreement shall have been duly executed by the parties
thereto and delivered to the Collateral Agent and shall be in full force
and effect, and all the outstanding capital stock of or equity interests in
each Subsidiary of the Borrower owned by the Borrower or any Subsidiary of
the Borrower shall have been duly and validly pledged thereunder to the
Collateral Agent for the ratable benefit of the Secured Parties and (i) in
the case of corporate Subsidiaries, certificates representing such shares,
accompanied by instruments of transfer and stock powers endorsed in blank,
shall be in the actual possession of the Collateral Agent and (ii) in the
case of partnerships and other non-corporate Subsidiaries, such pledge
shall have been perfected by the filing of Uniform Commercial Code
financing statements and/or registration of such pledge with the issuer,
and all consents of third parties to the perfection of such pledge and the
foreclosure thereon and admission of the Collateral Agent as a partner (or
member, as applicable) thereof shall have been obtained.
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(g) The Collateral Agent shall have received the results of a search
of the Uniform Commercial Code (or equivalent filings) filings made with
respect to the Borrower and its Subsidiaries in the states (or other
jurisdictions) in which the chief executive office of the Borrower and such
Subsidiaries are located and the other jurisdictions in which Uniform
Commercial Code filings (or equivalent filings) are to be made pursuant to
the Mortgages, together with copies of the financing statements (or similar
documents) disclosed by such search, and accompanied by evidence
satisfactory to the Collateral Agent that the Liens indicated in any such
financing statement (or similar document) would be permitted under
Section 6.02 or have been released.
(h)(i) Each of the Security Documents, in form and substance
satisfactory to the Lenders, relating to each of the Mortgaged Properties
shall have been duly executed by the parties thereto and delivered to the
Collateral Agent and shall be in full force and effect, (ii) each of such
Mortgaged Properties shall not be subject to any Lien other than those
permitted under Section 6.02, (iii) each of such Security Documents
(including the Mortgage and each uniform commercial code financing
statement) shall have been filed and recorded in the recording office as
specified on Schedule 4.02(h) and, in connection therewith, the Collateral
Agent shall have received evidence satisfactory to it of each such filing
and recordation (or a Lender's title insurance policy in form and substance
acceptable to the Collateral Agent, insuring such Security Document as a
first Lien on such Mortgaged Property (subject to any Lien permitted by
Section 6.02), and containing a "gap" endorsement insuring against
intervening Liens between the Closing Date and the date of such recording
or filing, shall have been received by the Collateral Agent) and (iv) the
Collateral Agent shall have received such other documents, including
surveys, abstracts, appraisals and legal opinions required to be furnished
pursuant to the terms of the Mortgages or as reasonably requested by the
Collateral Agent.
(i) Each Guarantee Agreement (including a separate Guarantee
Agreement from each Guarantor that is a California corporation) shall have
been duly executed by the parties thereto, shall have been
69
delivered to the Collateral Agent and shall be in full force and effect.
(j) The Indemnity, Subrogation and Contribution Agreement shall have
been duly executed by the parties thereto, shall have been delivered to the
Collateral Agent and shall be in full force and effect.
(k) The Hazardous Materials Indemnity Agreement shall have been duly
executed by the parties thereto, shall have been delivered to the
Collateral Agent and shall be in full force and effect.
(l) The Omnibus Amendment shall have been duly executed by the
parties thereto, shall have been delivered to the Collateral Agent and
shall be in full force and effect.
(m) The Administrative Agent shall have received a Borrowing Base
Certificate dated the Closing Date, relating to the most recent practicable
date (but in no event as of a date earlier than March 31, 1997), and
executed by a Financial Officer of the Borrower.
(n) The Administrative Agent shall have received a copy of, or a
certificate as to coverage under, the insurance policies required by
Section 5.02 and the Security Documents, each of which shall be endorsed or
otherwise amended to include a "standard" or "New York" lender's loss
payable endorsement and to name the Collateral Agent as additional insured,
in form and substance satisfactory to the Administrative Agent.
(o) The Lenders shall (i) have received copies of all Phase I or
Phase II third-party environmental reports prepared at any time during the
past three years as to any Property and (ii) be reasonably satisfied that
there are no material environmental and employee health and safety
exposures to which the Borrower and the Subsidiaries may be subject and the
plans of the Borrower with respect thereto.
(p) The Lenders shall have received appraisals, commissioned by and
satisfactory in form and substance to the Lenders from a firm acceptable to
the Lenders, of the real property, personal property and other assets of
the Borrower. Such appraisals shall satisfy FIRREA standards.
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(q) The Administrative Agent shall have received for each New
Mortgaged Property the following:
(i) a copy of such original permanent or temporary certificate
of occupancy, if any, issued upon completion of each New Mortgaged
Property (or any amendment issued upon completion of any alteration)
by the appropriate Governmental Authority (or such other evidence as
the Administrative Agent deems satisfactory in its sole discretion as
to the governmental authorization for the use and occupancy of each
Mortgaged Property);
(ii) a copy of all material applications, licenses, permits and
authorizations which are necessary for the operation of the Mortgaged
Property (or, in the case of New Mortgaged Property currently
undergoing construction, necessary for such construction);
(iii) a current Phase I environmental study in respect of such
New Mortgaged Property addressed to the Administrative Agent (or on
which the Administrative Agent is authorized to rely), acceptable in
all respects to the Administrative Agent;
(iv) executed or conformed copies of all Major Leases identified
on the Rent Roll for such New Mortgaged Property, and any amendments
thereto on or prior to the Closing Date, and any reciprocal easement
or operating agreements or other material covenants, restrictions or
agreements affecting the New Mortgaged Property, the terms and
conditions of which shall be in all respects satisfactory to the
Administrative Agent (and all such Major Leases, as so amended, and
all such other covenants, restrictions or agreements shall be in full
force and effect, and no Loan Party shall have failed in any material
respect to perform any material obligation or covenant required by
the Major Leases or such other covenants, restrictions or agreements
to be performed or complied with prior to the Closing Date);
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(v) duly executed originals of estoppel certificates and
subordination and nondisturbance agreements with respect to such
leases and all such other covenants, restrictions or agreements as
the Administrative Agent deems satisfactory in its sole discretion;
(vi) a letter of appropriate municipal authorities or other
evidence satisfactory to the Administrative Agent concerning the
zoning laws applicable to each New Mortgaged Property;
(vii) a policy or policies of title insurance (A) issued by a
nationally recognized title insurance company, selected or approved
by the Collateral Agent, (B) issued in the name of The Chase
Manhattan Bank, as Collateral Agent for the Secured Parties, (C) in
an aggregate amount equal to the lesser of the Total Commitment and
the appraised value of the Mortgaged Properties and (D) in the form
set forth by ALTA Loan 1970, as amended, or if such form is not
available, by ALTA-1992 (with a waiver of the arbitration provision
contained in the ALTA-1992 form), together with such endorsements,
coinsurance and reinsurance as may be reasonably required by the
Collateral Agent, insuring the Mortgages as valid first liens on the
New Mortgaged Properties, free of Liens other than those permitted
under Section 6.02;
(viii) such surveys and/or certificates of the Borrower as shall be
necessary to obtain the deletion from the title insurance described
in clause (vii) above the exception for defects that would be shown
by an accurate survey of the Mortgaged Property; and
(ix) a certificate executed by a Financial Officer of the
Borrower certifying that there have been no material adverse changes
in the New Mortgaged Properties since
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March 31, 1997, in form satisfactory to the Lenders.
(r) The Administrative Agent shall have received for each Mortgaged
Property (other than the New Mortgaged Properties) the following:
(i) a certificate executed by a Financial Officer of the
Borrower certifying that there have been no material adverse changes
in the Mortgaged Properties since March 31, 1997, in form
satisfactory to the Lenders;
(ii) Reissued policies of mortgagee title insurance, effective
the Closing Date, with insurers satisfactory to the Lenders and
without any exceptions to title which are not approved by the
Lenders, with increases in coverage to the aggregate amount equal to
the lesser of the Total Commitment and the appraised value of the
Mortgaged Properties (including, without limitation, the New
Mortgaged Properties);
(iii) the Mortgage Amendments shall be executed and recorded.
(s) After giving effect to the Formation, and the application of the
first Borrowing, on the Closing Date the Borrower and its Subsidiaries
shall have outstanding no Indebtedness or preferred stock other than (i)
the Loans, (ii) the Term Note, (iii) the Preferred Shares and (iv) the
Indebtedness listed on Schedule 4.02(s).
(t) Other than the Allocation Agreement, the Benefits Agreement and
the Trademark License Agreement, neither the Borrower nor any of its
Subsidiaries will be party to any material agreement with Xxxx or its
Affiliates.
(u) The Administrative Agent shall have received evidence that Form
D-37 has been filed by each Loan Party granting a Mortgage on Mortgaged
Property located in Hawaii.
(v) A cash collateral agreement relating to any future deposits
described in Section 2.09 shall have been duly executed by the Borrower
and the Collateral
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Agent and shall have been delivered to the Collateral Agent and shall be in
full force and effect.
ARTICLE V. AFFIRMATIVE COVENANTS
The Borrower covenants and agrees with each Lender that so long as
this Agreement shall remain in effect and until the Commitments have been
terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Loan Document shall have been
paid in full and all Letters of Credit have been canceled or have expired and
all amounts drawn thereunder have been reimbursed in full, unless the
Required Lenders shall otherwise consent in writing, the Borrower will, and
will cause each of the Subsidiaries to:
SECTION 5.01. EXISTENCE; BUSINESSES AND PROPERTIES. (a) Do or
cause to be done all things necessary to preserve, renew and keep in full
force and effect its legal existence, except as otherwise expressly permitted
under Section 6.05.
(b) Do or cause to be done all things necessary to obtain,
preserve, renew, extend and keep in full force and effect the rights,
licenses, permits, franchises, authorizations, patents, copyrights,
trademarks and trade names material to the conduct of its business; maintain
and operate such business in substantially the manner in which it is
presently conducted and operated; comply in all material respects with all
applicable laws, rules, regulations (including any zoning, building,
Environmental Law, ordinance, code or approval or any building permits or any
restrictions of record or agreements affecting the Mortgaged Properties) and
decrees and orders of any Governmental Authority, whether now in effect or
hereafter enacted; and at all times maintain and preserve all property
material to the conduct of such business and keep such property in good
repair, working order and condition and from time to time make, or cause to
be made, all needful and proper repairs, renewals, additions, improvements
and replacements thereto necessary in order that the business carried on in
connection therewith may be properly conducted at all times (except as a
result of the sale of assets permitted by Section 6.05).
SECTION 5.02. INSURANCE. (a) Keep its insurable properties insured
at all times by financially sound and
74
reputable insurers; maintain such other insurance, to such extent and against
such risks, including fire and other risks insured against by extended
coverage, as is customary with companies in the same or similar businesses
operating in the same or similar locations, including public liability
insurance against claims for personal injury or death or property damage
occurring upon, in, about or in connection with the use of any properties
owned, occupied or controlled by it; and maintain such other insurance as may
be required by law.
(b) Cause all such policies to be endorsed or otherwise amended to
include a "standard" or "New York" lender's loss payable endorsement, in form
and substance satisfactory to the Administrative Agent and the Collateral
Agent, which endorsement shall provide that, from and after the Closing Date,
if the insurance carrier shall have received written notice from the
Administrative Agent or the Collateral Agent of the occurrence of an Event of
Default, the insurance carrier shall pay all proceeds otherwise payable to
the Borrower or the Loan Parties under such policies directly to the
Collateral Agent; cause all such policies to provide that neither the
Borrower, the Administrative Agent, the Collateral Agent nor any other party
shall be a coinsurer thereunder and to contain a "Replacement Cost
Endorsement", without any deduction for depreciation, and such other
provisions as the Administrative Agent or the Collateral Agent may reasonably
require from time to time to protect their interests; cause each such policy
to provide that it shall not be canceled, modified or not renewed (i) by
reason of nonpayment of premium upon not less than 10 days' prior written
notice thereof by the insurer to the Administrative Agent and the Collateral
Agent (giving the Administrative Agent and the Collateral Agent the right to
cure defaults in the payment of premiums) or (ii) for any other reason upon
not less than 30 days' prior written notice thereof by the insurer to the
Administrative Agent and the Collateral Agent; deliver to the Administrative
Agent and the Collateral Agent, prior to the cancellation, modification or
nonrenewal of any such policy of insurance, a copy of a renewal or
replacement policy (or other evidence of renewal of a policy previously
delivered to the Administrative Agent and the Collateral Agent) together with
evidence satisfactory to the Administrative Agent and the Collateral Agent of
payment of the premium therefor.
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SECTION 5.03. Obligations and Taxes. Pay its Indebtedness and
other obligations promptly and in accordance with their terms and pay and
discharge promptly when due all taxes, assessments, notices of deficiency and
governmental charges or levies imposed upon it or upon its income or profits
or in respect of its property, before the same shall become delinquent or in
default, as well as all lawful claims for labor, materials and supplies or
otherwise that, if unpaid, might give rise to a Lien upon such properties or
any part thereof; provided, however, that such payment and discharge shall
not be required with respect to any such tax, assessment, notice, charge,
levy or claim so long as the validity or amount thereof shall be contested in
good faith by appropriate proceedings and the Borrower shall have set aside
on its books adequate reserves with respect thereto in accordance with GAAP
and such contest operates to suspend collection of the contested obligation,
tax, assessment, deficiency or charge and enforcement of a Lien and, in the
case of a Mortgaged Property, there is no risk of forfeiture of such property
as a result of such nonpayment.
SECTION 5.04. FINANCIAL STATEMENTS, REPORTS, ETC. In the case of the
Borrower, furnish to the Administrative Agent (with, in the case of paragraphs
(a) and (b) below, sufficient copies for each Lender):
(a) within 95 days after the end of each fiscal year, its consolidated
balance sheet and related statements of operations, stockholders' equity
and cash flows showing the financial condition of the Borrower and its
consolidated Subsidiaries as of the close of such fiscal year and the
results of its operations and the operations of such Subsidiaries during
such year, all audited by Xxxxxx Xxxxxxxx LLP or other independent public
accountants of recognized national standing acceptable to the Required
Lenders and accompanied by an opinion of such accountants (which shall not
be qualified in any material respect) to the effect that such consolidated
financial statements fairly present the financial condition and results of
operations of the Borrower and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied;
(b) within 50 days after the end of each of the first three fiscal
quarters of each fiscal year, its consolidated balance sheet and related
statements of
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operations, stockholders' equity and cash flows showing the financial
condition of the Borrower and its consolidated Subsidiaries as of the
close of such fiscal quarter and the results of its operations and the
operations of such Subsidiaries during such fiscal quarter and the then
elapsed portion of the fiscal year, all certified by one of its
Financial Officers as fairly presenting the financial condition and
results of operations of the Borrower and its consolidated Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied,
subject to normal year-end audit adjustments;
(c) concurrently with any delivery of financial statements under
sub-paragraph (a) or (b) above, (i) a certificate of the accounting firm
(in the case of sub-paragraph (a)) or Financial Officer (in the case of
sub-paragraph (b)) opining on or certifying such statements and (ii) a
certificate substantially in the form of Exhibit K of a Financial
Officer certifying that no Event of Default or Default has occurred or,
if such an Event of Default or Default has occurred, specifying the
nature and extent thereof and any corrective action taken or proposed to
be taken with respect thereto and certifying the calculations included
in such certificate and that such person has reviewed the terms of this
Agreement and the other Loan Documents and has made a review in
reasonable detail of the financial covenants set forth in this Agreement.
(d) within 50 days after the end of each fiscal quarter, a
certificate in the form of Exhibit F (a "BORROWING BASE CERTIFICATE")
showing the Borrowing Base as of the close of business on the last day
of such fiscal quarter (including any Mortgaged Properties and any
Additional Mortgaged Properties), and a certificate (a "TOTAL
INDEBTEDNESS CERTIFICATE") showing the Total Indebtedness as of the
close of business on the last day of such fiscal quarter, each such
Certificate to be certified as true and correct on behalf of the
Borrower by a Financial Officer of the Borrower;
(e) within 95 days after the end of each fiscal year, a rent-roll
for each of the Mortgaged Properties and the Additional Mortgaged
Properties, as of the last day of the immediately preceding fiscal year,
including the name of each tenant or other occupant, the date,
77
commencement date and termination date of each lease or occupancy
agreement, the monthly fixed and escalation rent of each lease or
occupancy agreement, the size and location of the leased or occupied
premises, the date to which rent has been paid, the amount of any
security deposit, the name of any guarantors, the existence of any
options under the lease or occupancy agreement, and such other matters
as the Administrative Agent may reasonably request, certified as true
and complete by a Financial Officer of the Borrower;
(f) within 95 days after the end of each fiscal year, an operating
statement for each of the Mortgaged Properties, covering the immediately
preceding fiscal year, including in detail all terms of income and
expense and such other items relating to the operation of the Mortgaged
Properties as the Administrative Agent may reasonably request, certified
as true and complete by a Financial Officer of the Borrower;
(g) within 50 days after the end of each fiscal quarter, a status
report describing in detail all significant changes at material
commercial projects of the Borrower and the Subsidiaries, including such
matters relating thereto as the Administrative Agent may reasonably
request, certified as true and complete by a Financial Officer of the
Borrower;
(h) promptly after the same become publicly available, copies of
all periodic and other reports, proxy statements and other materials
filed by the Borrower or any Subsidiary with the Securities and Exchange
Commission, or any Governmental Authority succeeding to any or all of
the functions of said Commission, or with any national securities
exchange, or distributed to its shareholders, as the case may be;
(i) within 60 days after the end of each fiscal quarter, the
Borrower shall submit to the Administrative Agent a progress report
regarding the remediation at the Xxxx Cannery Commercial Development,
identifying tasks commenced and completed and summarizing costs incurred
and costs projected for tasks in the next phase, as provided in the RAP;
and
(j) promptly, from time to time, such other information regarding
the operations, business affairs and financial condition of the Borrower
or any Subsidiary, or compliance with the terms of any Loan Document,
78
as the Administrative Agent or any Lender may reasonably request.
SECTION 5.05. LITIGATION AND OTHER NOTICES. Furnish to the
Administrative Agent and each Lender prompt written notice of the following:
(a) any Event of Default or Default, specifying the nature and
extent thereof and the corrective action (if any) taken or proposed to
be taken with respect thereto;
(b) the filing or commencement of, or any threat or notice of
intention of any person to file or commence, any action, suit or
proceeding, whether at law or in equity or by or before any Governmental
Authority, against the Borrower or any Affiliate thereof that could
reasonably be expected to result in a Material Adverse Effect; and
(c) any development that has resulted in, or could reasonably be
expected to result in, a Material Adverse Effect.
SECTION 5.06. EMPLOYEE BENEFITS. (a) Comply in all material
respects with the applicable provisions of ERISA and the Code and (b) furnish
to the Administrative Agent (i) as soon as possible after, and in any event
within 10 days after any Responsible Officer of the Borrower or any ERISA
Affiliate knows or has reason to know that, any ERISA Event has occurred
that, alone or together with any other ERISA Event could reasonably be
expected to result in liability of the Borrower in an aggregate amount
exceeding $5,000,000 or requiring payments exceeding $2,000,000 in any year,
a statement of a Financial Officer of the Borrower setting forth details as
to such ERISA Event and the action, if any, that the Borrower proposes to
take with respect thereto.
SECTION 5.07. MAINTAINING RECORDS; ACCESS TO PROPERTIES AND
INSPECTIONS. Keep proper books of record and account in which full, true and
correct entries in conformity with GAAP and all requirements of law are made
of all dealings and transactions in relation to its business and activities.
Each Loan Party will, and will cause each of its Subsidiaries to, permit any
representatives designated by the Administrative Agent to visit and inspect
the financial records and the properties of the Borrower or
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any Subsidiary at reasonable times and as often as reasonably requested and
to make extracts from and copies of such financial records, and permit any
representatives designated by the Administrative Agent to discuss the
affairs, finances and condition of the Borrower or any Subsidiary with the
officers thereof and independent accountants therefor (after notice to the
Borrower and an opportunity for the Borrower to be present during such
discussions). Any Lender may request that the Administrative Agent designate
it as a representative to visit and inspect the financial records and the
properties of the Borrower or any Subsidiary as provided in this Section
5.07, in which case the Administrative Agent shall not unreasonably withhold
such designation.
SECTION 5.08. USE OF PROCEEDS. Use the proceeds of the Loans only
for the purposes set forth in the preamble to this Agreement.
SECTION 5.09. COMPLIANCE WITH ENVIRONMENTAL LAWS. Comply, and cause
all lessees and other persons occupying its Properties to comply, in all
material respects with all Environmental Laws and Environmental Permits
applicable to its operations and Properties; obtain and renew all material
Environmental Permits necessary for its operations and Properties; and conduct
any Remedial Action in accordance with Environmental Laws in all material
respects.
SECTION 5.10. (a) PREPARATION OF ENVIRONMENTAL REPORTS. If a Default
caused by reason of a breach of Section 3.17 or 5.09 shall have occurred and be
continuing, at the request of the Required Lenders through the Administrative
Agent, provide to the Lenders within 45 days after such request, at the expense
of the Borrower, an environmental site assessment report for the Properties
which are the subject of such default prepared by an environmental consulting
firm acceptable to the Administrative Agent and indicating the presence or
absence of Hazardous Materials and the estimated cost of any compliance or
Remedial Action in connection with such Properties.
(b) The Administrative Agent shall have the right to retain a
nationally recognized environmental consultant who is knowledgeable of Hawaii
Department of Health environmental requirements and procedures to assist the
Administrative Agent on an ongoing basis for the purpose of reviewing the RAP
and/or monitoring the status of the
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remediation at the Xxxx Cannery Commercial Development, any work performed by
such consultant on behalf of the Administrative Agent shall be reasonable in
nature and scope (i.e., the parties contemplate a desktop review of the
Borrower's quarterly reports). The reasonable fees and expenses of such
consultant shall be paid by the Borrower.
(c) If at any time the Required Lenders, each Lender acting in its
sole discretion, determine that the total cost to remediate the Xxxx Cannery
Commercial Development after the date hereof could reasonably be expected to
exceed $6,000,000, then the Required Lenders shall have the right, by written
notice to the Borrower, the Administrative Agent and each other Lender (the
"Notice"), to reduce the Allocated Loan Value for the Xxxx Cannery Commercial
Development by such amount as the Required Lenders may specify (each Lender
acting in its sole discretion); provided, however, that the reduction of the
Xxxx Cannery Commercial Development's Allocated Loan Value and the consequent
reduction of the Borrowing Base, shall not be effective (with respect to any
prepayment obligation which the Borrower may then have pursuant to this
Agreement) for 90 days from the date upon which the Administrative Agent
sends the Notice provided, further, however, that the reduction of such
property's Allocated Loan Value and the consequent reduction of the Borrowing
Base shall be immediately effective for purposes of determining any proposed
Borrowing that increases the aggregate principal amount of Loans outstanding
of any Lender after the date of the Notice. During this 90 day period, the
Borrower may provide the Collateral Agent and the Lenders with an Additional
Mortgaged Property(s) or evidence of other upward adjustments to the
Borrowing Base, pursuant to and in accordance with the applicable provisions
of this Agreement.
SECTION 5.11. FURTHER ASSURANCES. Execute any and all further
documents, financing statements, agreements and instruments, and take all
further action (including filing Uniform Commercial Code and other financing
statements, Forms D-37, mortgages and deeds of trust) that may be required under
applicable law, or that the Required Lenders, the Administrative Agent or the
Collateral Agent may reasonably request, in order to effectuate the transactions
contemplated by the Loan Documents and in order to grant, preserve, protect and
perfect the validity and first priority of the security interests created or
intended to be created by the Security Documents. The Borrower will cause any
subsequently acquired or organized Material
81
Subsidiary (and any other Subsidiary that hereafter becomes a Material
Subsidiary) to execute a Guarantee Agreement, an Indemnity Subrogation and
Contribution Agreement, a Pledge Agreement and a Hazardous Materials
Indemnity Agreement in favor of the Collateral Agent. The Borrower agrees to
provide such evidence as the Collateral Agent shall reasonably request as to
the perfection and priority status of each such security interest and Lien.
ARTICLE VI. NEGATIVE COVENANTS
The Borrower covenants and agrees with each Lender that, so long as
this Agreement shall remain in effect and until the Commitments have been
terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Loan Document have been paid in
full and all Letters of Credit have been canceled or have expired and all
amounts drawn thereunder have been reimbursed in full, unless the Required
Lenders shall otherwise consent in writing, the Borrower will not, and will
not cause or permit any of the Subsidiaries to:
SECTION 6.01. INDEBTEDNESS. Incur, create, assume or permit to exist
any Indebtedness, except:
(a) Indebtedness created hereunder and the Guarantee Agreements;
(b) Indebtedness specified on Schedule 4.02(s);
(c) Indebtedness of (i) the Borrower to any wholly owned Subsidiary,
(ii) any Subsidiary to the Borrower or (iii) any Subsidiary to any wholly
owned Subsidiary;
(d) Indebtedness of the Borrower or any Subsidiary in the form of
reimbursement obligations in respect of letters of credit issued in the
ordinary course of the Borrower's business (other than the Letters of
Credit); provided that such Indebtedness shall not include any letter of
credit which supports obligations having a final maturity longer than one
year from the date of the incurrence of such obligations;
(e) Indebtedness of the Borrower or any Subsidiary in the form of
reimbursement obligations in respect of completion or surety bonds issued
in the ordinary course of the Borrower's business in respect of any
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construction project undertaken by the Borrower or any Subsidiary;
(f) Up to $75,000,000 aggregate principal amount of Indebtedness
outstanding at any time in the form of notes, bonds or debentures which
(i) are issued in order to fund infrastructure improvements on or services
for real property developments in the ordinary course of the Borrower's
business, (ii) are payable wholly from assessments or taxes levied on such
real property, (iii) may be secured by such real property and (iv) do not
otherwise have recourse to the Borrower or any Subsidiary or their
respective assets; and
(g) Permitted Third Party Indebtedness; provided that (i) the
aggregate principal amount of Indebtedness outstanding at any time under
clauses (a) and (b) (and reimbursement obligations due and payable under
any letter of credit or surety bond referred to in clause (d) or (e) above,
to the extent the same remain unpaid for more than 10 days) of this
Section 6.01 and this clause (g) shall not exceed the lesser of (A) the
Total Commitment (i.e., $250,000,000, subject to any reduction pursuant to
Section 2.09) plus $10,000,000 or (B) the Borrowing Base (subject to any
reduction pursuant to Section 2.09) plus $10,000,000 and (ii) the aggregate
principal amount of Permitted Third Party Indebtedness outstanding at any
time under this clause (g) shall not exceed $75,000,000; PROVIDED, HOWEVER,
that the aggregate principal amount of the Indebtedness of the Camp Tenneco
Partnership outstanding as of the date hereof, as specified on
Schedule 4.02(s), shall not be taken into account for purposes of
clause (i) of the preceding proviso to this clause (g), except to the
extent that demand for payment of such Indebtedness is made on the general
partners of the Camp Tenneco Partnership and remains unpaid for more than
10 days.
SECTION 6.02. LIENS. Create, incur, assume or permit to exist any
Lien on any property or assets (including stock or other securities of any
person, including any Subsidiary) now owned or hereafter acquired by it or on
any income or revenues or rights in respect of any thereof, except:
(a) Liens on property or assets of the Borrower and its Subsidiaries
existing on the date hereof and set forth in Schedule 6.02; PROVIDED that
such Liens
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shall secure only those obligations which they secure on the date hereof;
(b) any Lien created under the Loan Documents;
(c) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary; PROVIDED that
(i) such Lien is not created in contemplation of or in connection with such
acquisition, (ii) such Lien does not apply to any other property or assets
of the Borrower or any Subsidiary and (iii) such Lien does not
(A) materially interfere with the use, occupancy and operation of any
Mortgaged Property, (B) materially reduce the fair market value of such
Mortgaged Property but for such Lien or (C) result in any material increase
in the cost of operating, occupying or owning or leasing such Mortgaged
Property;
(d) Liens for taxes, assessments or other governmental charges not yet
due or which are being contested in compliance with Section 5.03;
(e) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business
and securing obligations that are not due and payable or which are being
contested in compliance with Section 5.03;
(f) pledges and deposits made in the ordinary course of business in
compliance with workmen's compensation, unemployment insurance and other
social security laws or regulations;
(g) deposits to secure the performance of bids, trade or government
contracts (other than for Indebtedness), leases (other than Capital Lease
Obligations), statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary
course of business;
(h) zoning restrictions, easements, rights-of-way, restrictions on use
of real property and other similar encumbrances incurred in the ordinary
course of business which, in the aggregate, are not substantial in amount
and do not materially detract from the value of
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the property subject thereto or interfere with the ordinary conduct of the
business of the Borrower or any of its Subsidiaries;
(i) judgment, attachment and other similar Liens arising in connection
with court proceedings; provided that (i) the execution or other
enforcement thereof is effectively stayed and the claims secured thereby
are being actively contested in good faith by appropriate proceedings and
(ii) no Default or Event of Default shall have occurred and be continuing;
(j) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement relating to items of
office equipment, signage or other items of personal property not material
(individually or in the aggregate) in value or to the use or operation of
any real property of the Borrower or its Subsidiaries; and
(k) Liens securing Indebtedness permitted under Section 6.01(f).
SECTION 6.03. SALE AND LEASE-BACK TRANSACTIONS. Enter into any
arrangement, directly or indirectly, with any person whereby it shall sell or
transfer any property, real or personal, used or useful in its business,
whether now owned or hereafter acquired, and thereafter rent or lease such
property or other property which it intends to use for substantially the same
purpose or purposes as the property being sold or transferred, except for any
such arrangement with respect to the sale of model homes not exceeding in any
fiscal quarter, in the aggregate, the lesser of (i) 15 Model Homes or (ii)
$6,000,000 in aggregate purchase price.
SECTION 6.04. INVESTMENTS. (a) Make aggregate Investments during
any fiscal year, commencing with fiscal 1996, outside the scope of the business
segments and business activities being conducted by the Borrower and its
Subsidiaries as of the date hereof in excess of $25,000,000.
(b) Make aggregate Investments during any fiscal year, commencing
with fiscal 1996, in Resort Properties in excess of the sum of (i) $20,000,000
plus (ii) Xxxx'i Contracted Homes/Lots at any time during such fiscal year;
provided, that credit under clause (ii) for a given Xxxx'i Contracted Home/Lot
cannot be used more than once as a credit against Investments. For purposes of
this Section
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6.04(b), Investments shall not include non-discretionary capital expenditures
necessary to maintain the existing Resort Properties to current standards,
provided that the excluded portion of such expenditures shall be limited to
$10,000,000 in each fiscal year. One half of the amount of any Investment
capacity under clause (i) above which has not been used by the end of a
fiscal year can be carried over into the following fiscal years until used.
(c) Incur expenses or make Investments, at any time, in excess of a
total of $30,000,000 on a net basis in connection with the development or
proposed development of any single new real estate project, including those made
as a part of a joint venture, without the prior approval of Required Lenders.
In connection with approval of Required Lenders, the Borrower shall provide
(i) pro forma cash budget for the new real estate project; (ii) a copy of all
contracts related to the real estate project and (iii) supporting market
information.
SECTION 6.05. MERGERS, CONSOLIDATIONS, SALES OF ASSETS AND
ACQUISITIONS. Merge into or consolidate with any other person, or permit any
other person to merge into or consolidate with it, or sell, transfer, lease
or otherwise dispose of (in one transaction or in a series of transactions)
all or any substantial part of its assets (whether now owned or hereafter
acquired) or any capital stock of any Material Subsidiary, or purchase, lease
or otherwise acquire (in one transaction or a series of transactions) all or
any substantial part of the assets of any other person, except that (a) the
Borrower and any Subsidiary may purchase and sell Inventory in the ordinary
course of business and (b) if at the time thereof and immediately after
giving effect thereto no Event of Default or Default shall have occurred and
be continuing (i) any wholly owned Subsidiary may merge into the Borrower in
a transaction in which the Borrower is the surviving corporation, (ii) any
wholly owned Subsidiary may merge into or consolidate with any other wholly
owned Subsidiary in a transaction in which the surviving entity is a wholly
owned Subsidiary and no person other than the Borrower or a wholly owned
Subsidiary receives any consideration and (iii) any Subsidiary may sell any
Mortgaged Property, Additional Mortgaged Property or other property held by
such Subsidiary in its commercial and industrial property portfolio, subject
to compliance with Sections 2.09(b) and 2.11(b) and (c).
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SECTION 6.06. DIVIDENDS AND DISTRIBUTIONS; RESTRICTIONS ON ABILITY OF
SUBSIDIARIES TO PAY DIVIDENDS. (a) Declare or pay, directly or indirectly, any
dividend or make any other distribution (by reduction of capital or otherwise),
whether in cash, property, securities or a combination thereof, with respect to
any shares of its capital stock or directly or indirectly redeem, purchase,
retire or otherwise acquire for value (or permit any Subsidiary to purchase or
acquire) any shares of any class of its capital stock or set aside any amount
for any such purpose; provided, however, that (i) any Subsidiary may declare and
pay dividends or make other distributions to the Borrower or to other
Subsidiaries, (ii) the Borrower may declare and pay dividends on or redeem the
Preferred Shares and (iii) the Borrower may declare and pay dividends on its
shares of common stock, provided that the cumulative amount of such dividends
shall not at any time exceed the greater of (A) 50% of the cumulative Net Income
of the Borrower for all fiscal quarters ending after December 5, 1995, or
(B) zero.
(b) Permit its subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any encumbrance or
restriction on the ability of any such subsidiary to (i) pay any dividends or
make any other distributions on its capital stock or any other interest or (ii)
make or repay any loans or advances to the Borrower or the parent of such
subsidiary.
SECTION 6.07. TRANSACTIONS WITH AFFILIATES. Sell or transfer any
property or assets to, or purchase or acquire any property or assets from, or
otherwise engage in any other transactions with, any of its Affiliates,
except (i) as contemplated by the Allocation Agreement, the Benefits
Agreement, the Trademark License Agreement or the Xxxx Purchase Agreement,
(ii) the Borrower or any wholly owned Subsidiary of the Borrower may engage
in any of the foregoing transactions with the Borrower or any other wholly
owned Subsidiary of the Borrower and (iii) that so long as no Default or
Event of Default shall have occurred or be continuing, the Borrower or any
Subsidiary may engage in any of the foregoing transactions in the ordinary
course of business at prices and on terms and conditions not less favorable
to the Borrower or such Subsidiary than could be obtained on an arm's-length
basis from unrelated third parties.
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SECTION 6.08. PAYMENTS IN RESPECT OF PERMITTED THIRD PARTY DEBT.
Pay, directly or indirectly, any amount, whether in cash, property, securities
or any combination thereof, in respect of principal, interest or other
obligations under Permitted Third Party Debt at any time after a Default or
Event of Default has occurred and is continuing, unless such payments are made
pro rata (based on aggregate principal amounts outstanding) on both the Loans
and the Permitted Third Party Debt, with the portion paid in respect of the
Loans being applied to prepay the Loans and to permanently reduce the Total
Commitment.
SECTION 6.09. ISSUANCES OF CAPITAL STOCK. Issue any capital stock or
other equity interests, except:
(a) shares of common stock of the Borrower;
(b) shares of capital stock or other equity interests of a Subsidiary
issued to the Borrower or to a wholly-owned Subsidiary;
(c) the Preferred Shares; and
(d) shares of preferred stock, preference stock or preferential stock
of the Borrower which are in each case perpetual, with no right of the
holder to require purchase or redemption by the Borrower or any Subsidiary;
SECTION 6.10. TERM NOTE. Amend or modify the Term Note or prepay,
redeem or repurchase the Term Note.
SECTION 6.11. AMENDMENTS OF CERTAIN AGREEMENTS. Amend, waive or
modify the Allocation Agreement, the Benefits Agreement, the Trademark License
Agreement, the Xxxx Purchase Agreement or any of the other material agreements
listed on Schedule 6.11 in any manner, if such amendment, waiver or modification
(individually or in combination with other amendments, waivers and
modifications) would have a materially negative impact on the Borrower and its
Subsidiaries taken as a whole.
SECTION 6.12. TANGIBLE NET WORTH. Permit its Tangible Net Worth at
any date to be less than the sum of (i) $500,000,000, plus (ii) 75% of the
positive amount, if any, by which (A) cumulative Net Income of the Borrower for
all fiscal quarters ending after December 5, 1995, if positive, exceeds
(B) cumulative dividends paid by the
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Borrower on its capital stock during all such fiscal quarters, plus (iii)
100% of the net proceeds to the Borrower from the sale of any capital stock
of the Borrower after December 5, 1995.
SECTION 6.13. INTEREST COVERAGE RATIO. Permit the Interest Coverage
Ratio to be less than 2.00 to 1.00 for any period of four fiscal quarters ending
after fiscal 1996.
SECTION 6.14. CASH FLOW RATIO. Permit the Cash Flow Ratio to be less
than 1.00 to 1.00 for any period of four fiscal quarters ending after fiscal
1996.
SECTION 6.15. CERTAIN INVENTORY. (a) Permit there to be Unsold
Homes/Lots at any date in connection with its residential development business
on the Island of Lanai other than (i) not more than 20 Unsold Homes/Lots at
Manele Bay and (ii) not more than 20 Unsold Homes/Lots at The Lodge at Xxxxx.
(b) Permit Unsold Homes/Lots and Model Homes to exceed at any date
15% of Tangible Net Worth.
(c) Permit Model Homes (including Model Homes subject to sale and
lease-back arrangements permitted by Section 6.03) to exceed at any date 60 in
number.
(d) (i) Permit the number of units of Unsold Inventory on June 30,
1997 or September 30, 1997, to exceed 55% of the total number of units sold
during the period of 12 full months preceding such date.
(ii) Permit Unsold Inventory at December 31, 1997, to exceed a number
of units equal to 45% of the total number of units of Unsold Inventory sold
during the period of 12 full months preceding such date.
(iii) Permit Unsold Inventory at the last day of any fiscal quarter
ending after December 31, 1997, to exceed the following number of units (based
on the number of units of Unsold Inventory sold during the period 12 full months
preceding such quarter-end):
Unit Sales During Maximum Units
Preceding 12 Months at Quarter-End
------------------- --------------
If 500 units or less 175
If more than 500, but 550 or less 193
89
If more than 550, but 600 or less 210
If more than 600, but 650 or less 228
If more than 650, but 700 or less 245
If more than 700, but 750 or less 263
If more than 750, but 800 or less 280
If more than 800, but 850 or less 298
If more than 850, but 900 or less 315
If more than 900, but 950 or less 333
If more than 950 units 350
PROVIDED, HOWEVER, that (A) if Unsold Inventory exceeds the maximum level
specified in this Section 6.15(d) at the end of any single fiscal quarter,
then the sole consequence thereof shall be that the percentage specified in
clause (c) of the definition of Borrowing Base shall be automatically deemed
reduced to 65% for the next succeeding fiscal quarter; (B) if Unsold
Inventory exceeds the maximum level specified in this Section 6.15(d) at the
end of two consecutive fiscal quarters, then the sole consequence thereof
shall be that the percentage specified in clause (c) of the definition of
Borrowing Base shall be automatically deemed reduced to 50% for the next
succeeding fiscal quarter and each fiscal quarter thereafter until Unsold
Inventory is in compliance with the maximum level specified in this Section
6.15(d); and (C) if Unsold Inventory fails to comply with the maximum level
specified in this Section 6.15(d) at the end of three consecutive fiscal
quarters, such failure will constitute an Event of Default. The reductions
in Borrowing Base percentages referred to in clauses (A) and (B) of the
immediately preceding proviso shall be effective upon the delivery to the
Administrative Agent of the financial statements described in Section 5.04(a)
or (b), as applicable, for the preceding fiscal quarter in question, and
shall remain in effect until the delivery to the Administrative Agent of the
financial statements described in Section 5.04(a) or (b), as applicable, for
the next fiscal quarter.
ARTICLE VII. EVENTS OF DEFAULT
In case of the happening of any of the following events ("Events of
Default"):
(a) any representation or warranty made or deemed made by a Loan Party
in or in connection with any Loan Document or the borrowings or issuances
of Letters of Credit hereunder, or any representation, warranty,
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statement or information contained in any report, certificate, financial
statement or other instrument furnished in connection with or pursuant
to any Loan Document, shall prove to have been false in any material
respect when so made, deemed made or furnished;
(b) default shall be made in the payment of any principal of any Loan
when and as the same shall become due and payable, whether at the due date
thereof or at a date fixed for prepayment thereof or by acceleration
thereof or otherwise;
(c) default shall be made in the reimbursement by payment or financing
by ABR Loans pursuant to Sections 2.02(f) and 2.20(e) of any L/C
Disbursement, the payment of any interest on any Loan or L/C Disbursement
or any Fee or any other amount (other than an amount referred to in
(b) above) due under any Loan Document, when and as the same shall become
due and payable, and such default shall continue unremedied for a period of
three Business Days;
(d) default shall be made in the due observance or performance by the
Borrower or any Subsidiary of any covenant, condition or agreement
contained in Section 5.01(a), 5.05 or 5.08 or in Article VI;
(e) default shall be made in the due observance or performance by the
Borrower or any Subsidiary of any covenant, condition or agreement
contained in any Loan Document (other than those specified in (b), (c) or
(d) above) and such default shall continue unremedied for a period of
30 days after notice thereof from the Administrative Agent or any Lender to
the Borrower;
(f) the Borrower or any Subsidiary shall, beyond the end of any grace
period provided therefor, (i) fail to pay any principal or interest,
regardless of amount, due in respect of any Indebtedness in a principal
amount of $10,000,000 or more, when and as the same shall become due and
payable, or (ii) fail to observe or perform any other term, covenant,
condition or agreement contained in any agreement or instrument evidencing
or governing any such Indebtedness, if the effect of any failure referred
to in this clause (ii) is to cause, or to permit the holder or holders of
such Indebtedness or a trustee on its or their behalf (with
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or without the giving of notice) to cause, such Indebtedness to become
due prior to its stated maturity or to cause the purchase of such
Indebtedness by the Borrower or any Subsidiary of the Borrower;
(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking
(i) relief in respect of the Borrower or any Material Subsidiary, or of a
substantial part of the property or assets of the Borrower or a Material
Subsidiary, under Title 11 of the United States Code, as now constituted or
hereafter amended, or any other Federal, state or foreign bankruptcy,
insolvency, receivership or similar law, (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official
for the Borrower or any Material Subsidiary or for a substantial part of
the property or assets of the Borrower or a Material Subsidiary or
(iii) the winding-up or liquidation of the Borrower or any Material
Subsidiary; and such proceeding or petition shall continue undismissed for
60 days or an order or decree approving or ordering any of the foregoing
shall be entered;
(h) the Borrower or any Material Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking relief under Title 11
of the United States Code, as now constituted or hereafter amended, or any
other Federal, state or foreign bankruptcy, insolvency, receivership or
similar law, (ii) consent to the institution of, or fail to contest in a
timely and appropriate manner, any proceeding or the filing of any petition
described in (g) above, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official
for the Borrower or any Material Subsidiary or for a substantial part of
the property or assets of the Borrower or any Material Subsidiary,
(iv) file an answer admitting the material allegations of a petition filed
against it in any such proceeding, (v) make a general assignment for the
benefit of creditors, (vi) become unable, admit in writing its inability or
fail generally to pay its debts as they become due or (vii) take any action
for the purpose of effecting any of the foregoing;
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(i) one or more judgments for the payment of money in an aggregate
amount in excess of $5,000,000 not adequately covered by insurance shall be
rendered against the Borrower, any Material Subsidiary or any combination
thereof and the same shall remain undischarged for a period of
30 consecutive days during which execution shall not be effectively stayed,
or any action shall be legally taken by a judgment creditor to levy upon
assets or properties of the Borrower or any Subsidiary to enforce any such
judgment;
(j) an ERISA Event shall have occurred that, in the reasonable opinion
of the Required Lenders, when taken together with all other such ERISA
Events, could reasonably be expected to result in liability of the Borrower
and its ERISA Affiliates in an aggregate amount exceeding $5,000,000 or
requires payments exceeding $2,000,000 in any year;
(k) any security interest purported to be created by any Security
Document shall cease to be, or shall be asserted by the Borrower or any
other Loan Party not to be, a valid, perfected, first priority (except as
otherwise expressly provided in this Agreement or such Security Document)
security interest in the securities, assets or properties covered thereby,
except to the extent that any such loss of perfection or priority results
from the failure of the Collateral Agent to maintain possession of
certificates representing securities pledged under the Pledge Agreement and
except to the extent that such loss is covered by a lender's title
insurance policy and the related insurer promptly after such loss shall
have acknowledged in writing that such loss is covered by such title
insurance policy; or
(l) there shall have occurred a Change in Control;
then, and in every such event (other than an event with respect to the Borrower
described in paragraph (g) or (h) above), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, by notice to the Borrower, take either or both of
the following actions, at the same or different times: (i) terminate forthwith
the Commitments and (ii) declare the Loans then outstanding to be forthwith due
and payable in whole or in part, whereupon the principal of the Loans so
declared to be due and payable, together
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with accrued interest thereon and any unpaid accrued Fees and all other
liabilities of the Borrower accrued hereunder and under any other Loan
Document, shall become forthwith due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by the Borrower, anything contained herein or in any other
Loan Document to the contrary notwithstanding; and in any event with respect
to the Borrower described in paragraph (g) or (h) above, the Commitments
shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and any unpaid accrued
Fees and all other liabilities of the Borrower accrued hereunder and under
any other Loan Document, shall automatically become due and payable, without
presentment, demand, protest or any other notice of any kind, all of which
are hereby expressly waived by the Borrower, anything contained herein or in
any other Loan Document to the contrary notwithstanding.
ARTICLE VIII. THE ADMINISTRATIVE AGENT
AND THE COLLATERAL AGENT
In order to expedite the transactions contemplated by this Agreement,
The Chase Manhattan Bank is hereby appointed to act as Administrative Agent and
Collateral Agent on behalf of the Lenders (for purposes of this Article VIII,
the Administrative Agent and the Collateral Agent are referred to collectively
as the "AGENTS") and the Issuing Bank. Each of the Lenders and each assignee of
any such Lender, hereby irrevocably authorizes the Agents to take such actions
on behalf of such Lender or assignee or the Issuing Bank and to exercise such
powers as are specifically delegated to the Agents by the terms and provisions
hereof and of the other Loan Documents, together with such actions and powers as
are reasonably incidental thereto. The Administrative Agent is hereby expressly
authorized by the Lenders and the Issuing Bank, without hereby limiting any
implied authority, (a) to receive on behalf of the Lenders and the Issuing Bank
all payments of principal of and interest on the Loans, all payments in respect
of L/C Disbursements and all other amounts due to the Lenders hereunder, and
promptly to distribute to each Lender or the Issuing Bank its proper share of
each payment so received; (b) to give notice on behalf of each of the Lenders to
the Borrower of any Event of Default specified in this Agreement of which the
Administrative Agent has actual knowledge acquired in connection with its agency
hereunder; and (c) to distribute to each Lender copies of all notices and
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financial statements delivered by the Borrower or any other Loan Party pursuant
to this Agreement or the other Loan Documents as received by the Administrative
Agent. Without limiting the generality of the foregoing, the Agents are hereby
expressly authorized to execute any and all documents (including releases) with
respect to the Collateral and the rights of the Secured Parties with respect
thereto, as contemplated by and in accordance with the provisions of this
Agreement and the Security Documents.
Neither the Agents nor any of their respective directors, officers,
employees or agents shall be liable as such for any action taken or omitted by
any of them except for its or his own gross negligence or wilful misconduct, or
be responsible for any statement, warranty or representation herein or the
contents of any document delivered in connection herewith, or be required to
ascertain or to make any inquiry concerning the performance or observance by the
Borrower or any other Loan Party of any of the terms, conditions, covenants or
agreements contained in any Loan Document. The Agents shall not be responsible
to the Lenders for the due execution, genuineness, validity, enforceability or
effectiveness of this Agreement or any other Loan Documents, instruments or
agreements. The Agents shall in all cases be fully protected in acting, or
refraining from acting, in accordance with written instructions signed by the
Required Lenders and, except as otherwise specifically provided herein, such
instructions and any action or inaction pursuant thereto shall be binding on all
the Lenders. Each Agent shall, in the absence of knowledge to the contrary, be
entitled to rely on any instrument or document believed by it in good faith to
be genuine and correct and to have been signed or sent by the proper person or
persons. Neither the Agents nor any of their respective directors, officers,
employees or agents shall have any responsibility to the Borrower or any other
Loan Party on account of the failure of or delay in performance or breach by any
Lender or the Issuing Bank of any of its obligations hereunder or to any Lender
or the Issuing Bank on account of the failure of or delay in performance or
breach by any other Lender or the Issuing Bank or the Borrower or any other Loan
Party of any of their respective obligations hereunder or under any other Loan
Document or in connection herewith or therewith. Each of the Agents may execute
any and all duties hereunder by or through agents or employees and shall be
entitled to rely upon the advice of legal counsel selected by it with respect to
all matters arising hereunder and shall not be liable for
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any action taken or suffered in good faith by it in accordance with the
advice of such counsel.
The Lenders hereby acknowledge that neither Agent shall be under any
duty to take any discretionary action permitted to be taken by it pursuant to
the provisions of this Agreement unless it shall be requested in writing to do
so by the Required Lenders.
Subject to the appointment and acceptance of a successor
Administrative Agent or Collateral Agent (each referred to hereinafter as
"Agent") as provided below, either Agent may resign at any time by notifying the
Lenders and the Borrower. Upon any such resignation, the Required Lenders and
the Borrower shall have the right to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and the Borrower and shall have
accepted such appointment within 30 days after the retiring Agent gives notice
of its resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent which shall be a bank with an office in New York, New
York, having a combined capital and surplus of at least $5,000,000,000 or an
Affiliate of any such bank. Upon the acceptance of any appointment as Agent
hereunder by a successor bank, such successor shall succeed to and become vested
with all the rights, powers, privileges and duties of the retiring Agent and the
retiring Agent shall be discharged from its duties and obligations hereunder.
After the Agent's resignation hereunder, the provisions of this Article and
Section 9.05 shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Agent.
With respect to the Loans made or Letters of Credit issued by it
hereunder, each Agent in its individual capacity and not as Agent shall have the
same rights and powers as any other Lender and may exercise the same as though
it were not an Agent, and the Agents and their Affiliates may accept deposits
from, lend money to and generally engage in any kind of business with the
Borrower or any Subsidiary or other Affiliate thereof as if it were not an
Agent.
Each Lender agrees (a) to reimburse the Agents, on demand, in the
amount of its pro rata share (based on its Commitment hereunder) of any expenses
incurred for the benefit of the Lenders by the Agents, including protective
advances for insurance, taxes or other amounts advanced by
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the Collateral Agent to preserve or protect the interests of the Secured
Parties in any Mortgaged Property or Additional Mortgaged Property, as well
as counsel fees and compensa-tion of agents and employees paid for services
rendered on behalf of the Lenders, that shall not have been reimbursed by the
Borrower and (b) to indemnify and hold harmless each Agent and any of its
directors, officers, employees or agents, on demand, in the amount of such
pro rata share, from and against any and all liabilities, taxes, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be imposed on,
incurred by or asserted against it in its capacity as Agent or any of them in
any way relating to or arising out of this Agreement or any other Loan
Document or any action taken or omitted by it or any of them under this
Agreement or any other Loan Document, to the extent the same shall not have
been reimbursed by the Borrower or any other Loan Party, provided that no
Lender shall be liable to an Agent or any such other indemnified person for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements which are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or wilful misconduct of
such Agent or any of its directors, officers, employees or agents.
Each Lender acknowledges that it has, independently and without
reliance upon the Agents or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Agents or any other Lender
and based on such documents and information as it shall from time to time
deem appropriate, continue to make its own decisions in taking or not taking
action under or based upon this Agreement or any other Loan Document, any
related agreement or any document furnished hereunder or thereunder.
ARTICLE IX. MISCELLANEOUS
SECTION 9.01. NOTICES. Notices, consents, approvals and other
communications provided for herein shall be in writing and shall be delivered by
hand or overnight
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courier service, mailed by certified or registered mail or sent by telecopy,
as follows:
(a) if to the Borrower, to it at 00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000,
Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention of Xxxxxx X. Xxxxxx (Telecopy
No. (000) 000-0000);
(b) if to the Administrative Agent, to The Chase Manhattan Bank, 000
Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Xxxx
Xxxxxxxxx Xxxxx (Telecopy No. (000) 000-0000); and
(c) if to a Lender, to it at its address (or telecopy number) set
forth on Schedule 2.01 or in the Assignment and Acceptance pursuant to
which such Lender shall have become a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on
the date of receipt if delivered by hand or overnight courier service or sent
by telecopy or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 9.01 or in accordance
with the latest unrevoked direction from such party given in accordance with
this Section 9.01.
SECTION 9.02. SURVIVAL OF AGREEMENT. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and the Issuing Bank and shall survive the
making by the Lenders of the Loans and the issuance of Letters of Credit by the
Issuing Bank, regardless of any investigation made by the Lenders or the Issuing
Bank or on their behalf, and shall continue in full force and effect as long as
the principal of or any accrued interest on any Loan or any Fee or any other
amount payable under this Agreement or any other Loan Document is outstanding
and unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not been terminated. The provisions of Sections 2.12, 2.14, 2.18 and 9.05
shall remain operative and in full force and effect regardless of the expiration
of the term of this Agreement, the consummation of the transactions contemplated
hereby,
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the repayment of any of the Loans, the expiration of the Commitments, the
invalidity or unenforceability of any term or provision of this Agreement or
any other Loan Document, or any investigation made by or on behalf of the
Administrative Agent, the Collateral Agent, the Issuing Bank or any Lender.
SECTION 9.03. BINDING EFFECT. This Agreement shall become
effective when it shall have been executed by the Borrower, the
Administrative Agent and the other Lenders, and when the Administrative Agent
shall have received counterparts hereof which, when taken together, bear the
signatures of each of the parties hereto (which signatures may be by
facsimile), and thereafter shall be binding upon and inure to the benefit of
the parties hereto and their respective permitted successors and assigns.
Nothing in this Agreement shall be construed to affect the sums due from, and
the obligations of, the Borrower pursuant to the Original Credit Agreement
with respect to the period prior to the Closing Date.
SECTION 9.04. SUCCESSORS AND ASSIGNS. (a) Whenever in this
Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the permitted successors and assigns of such party; and all
covenants, promises and agreements by or on behalf of the Borrower, the
Administrative Agent, the Issuing Bank or the Lenders that are contained in
this Agreement shall bind and inure to the benefit of their respective
successors and assigns.
(b) Each Lender may assign to one or more assignees all or a
portion of its interests, rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans at the time owing
to it); PROVIDED, HOWEVER, that (i) except in the case of an assignment to a
Lender or an Affiliate of a Lender, (x) such assignment shall be made to an
Eligible Assignee, (y) the Borrower and the Administrative Agent (and, in the
case of any assignment of a Commitment, the Issuing Bank) must give their
prior written consent to such assignment (which consents shall not be
unreasonably withheld) and (z) the amount of the Commitment being assigned
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$10,000,000 (or, if less, the entire remaining amount of the assigning
Lender's Commitment), (ii) the parties to each such assignment shall execute
and
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deliver to the Administrative Agent an Assignment and Acceptance, together
with a processing and recordation fee of $3,500 and (iii) the assignee, if it
shall not be a Lender, shall deliver to the Administrative Agent an
Administrative Questionnaire. Upon acceptance and recording pursuant to
paragraph (e) of this Section 9.04, from and after the effective date
specified in each Assignment and Acceptance, which effective date shall be at
least five Business Days after the execution thereof, (A) the assignee
thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations
of a Lender under this Agreement and (B) the assigning Lender thereunder
shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in
the case of an Assignment and Acceptance covering all or the remaining
portion of an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto but shall continue to be
entitled to the benefits of Sections 2.12, 2.14, 2.18 and 9.05, as well as to
any Fees accrued for its account and not yet paid). Any assignment by any
Lender of its interests, rights or obligations under this Agreement to a
person other than a Lender, an Affiliate of a Lender or an Eligible Assignee
shall require the consent of the Borrower, which consent may be granted or
withheld by the Borrower in its sole discretion.
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner
of the interest being assigned thereby free and clear of any adverse claim
and that its Commitment, and the outstanding balance of its Loans, in each
case without giving effect to assignments thereof which have not become
effective, are as set forth in such Assignment and Acceptance, (ii) except as
set forth in (i) above, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement,
or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto, or the financial condition
of the Borrower or any Subsidiary or the performance or observance by the
Borrower or any Subsidiary
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of any of its obligations under this Agreement, any other Loan Document or
any other instrument or document furnished pursuant hereto; (iii) such
assignee represents and warrants that it is legally authorized to enter into
such Assignment and Acceptance; (iv) such assignee confirms that it has
received a copy of this Agreement, together with copies of the most recent
financial statements referred to in Section 3.05(a) or delivered pursuant to
Section 5.04 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (v) such assignee will independently and without
reliance upon the Administrative Agent, the Collateral Agent, such assigning
Lender 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; (vi) such assignee
appoints and authorizes the Administrative Agent and the Collateral Agent to
take such action as agent on its behalf and to exercise such powers under
this Agreement as are delegated to the Administrative Agent and the
Collateral Agent, respectively, by the terms hereof, together with such
powers as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all the obligations which
by the terms of this Agreement are required to be performed by it as a Lender.
(d) The Administrative Agent, acting for this purpose as an agent
of the Borrower, shall maintain at one of its offices in The City of New York
a copy of each Assignment and Acceptance delivered to it and a register for
the recordation of the names and addresses of the Lenders, and the Commitment
of, and principal amount of the Loans owing to, each Lender pursuant to the
terms hereof from time to time (the "REGISTER"). The entries in the Register
shall be conclusive and the Borrower, the Administrative Agent, Collateral
Agent, the Issuing Bank and the Lenders may treat each person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder
for all purposes of this Agreement, notwithstanding notice to the contrary.
The Register shall be available for inspection by the Borrower, the Issuing
Bank, the Collateral Agent and any Lender, at any reasonable time and from
time to time upon reasonable prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, an Administrative Questionnaire
completed
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in respect of the assignee (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b)
above and, if required, the written consent of the Borrower, the Issuing Bank
and the Administrative Agent to such assignment, the Administrative Agent
shall (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Lenders and the Issuing Bank. No assignment shall be effective unless it has
been recorded in the Register as provided in this paragraph (e).
(f) Each Lender may without the consent of the Borrower, the
Issuing Bank or the Administrative Agent sell participations to one or more
banks or other entities in all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitment and the
Loans owing to it); PROVIDED, HOWEVER, that (i) such Lender's obligations
under this Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) the participating banks or other entities shall be
entitled to the benefit of the cost protection provisions contained in
Sections 2.12, 2.14 and 2.18 to the same extent as if they were Lenders
(PROVIDED that notwithstanding anything else herein to the contrary, no such
participating bank or entity shall be entitled to receive any greater cost or
amount pursuant to such Sections as to any cost or amount described therein
existing or reasonably foreseeable at the time of the sale of such
participation than such Lender would have been entitled to receive in respect
of the amount of the participation sold by such Lender to such participating
bank or entity had such sale not occurred); and (iv) the Borrower, the
Administrative Agent, the Issuing Bank and the Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights
and obligations under this Agreement (except as provided in clause (iii)
above), and such Lender shall retain the sole right to enforce the
obligations of the Borrower relating to the Loans or L/C Disbursements and to
approve any amendment, modification or waiver of any provision of this
Agreement (other than amendments, modifications or waivers (x) decreasing any
fees payable hereunder or the amount of principal of or the rate at which
interest is payable on the Loans, (y) extending any scheduled principal
payment date or date fixed for the payment of interest on the Loans or
increasing or extending the Commitments or (z) releasing any Collateral or
any
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Guarantor except as expressly authorized by the Loan Documents).
(g) Any Lender or participant may, in connection with any
assignment or participation or proposed assignment or participation pursuant
to this Section 9.04, disclose to the assignee or participant or proposed
assignee or participant any information relating to the Borrower furnished to
such Lender by or on behalf of the Borrower; PROVIDED that, prior to any such
disclosure of information designated by the Borrower as confidential, each
such assignee or participant or proposed assignee or participant shall
execute an agreement whereby such assignee or participant shall agree
(subject to customary exceptions) to preserve the confidentiality of such
confidential information on terms no less restrictive than those applicable
to the Lenders pursuant to Section 9.16.
(h) Any Lender may at any time assign all or any portion of its
rights under this Agreement to a Federal Reserve Bank to secure extensions of
credit by such Federal Reserve Bank to such Lender; PROVIDED that no such
assignment shall release a Lender from any of its obligations hereunder or
substitute any such Bank for such Lender as a party hereto. In order to
facilitate such an assignment to a Federal Reserve Bank, the Borrower shall,
at the request of the assigning Lender, duly execute and deliver to the
assigning Lender a promissory note or notes evidencing the Loans made to the
Borrower by the assigning Lender hereunder.
(i) The Borrower shall not assign or delegate any of its rights or
duties hereunder without the prior written consent of the Administrative
Agent, the Issuing Bank and each Lender, and any attempted assignment without
such consent shall be null and void.
SECTION 9.05. EXPENSES; INDEMNITY. (a) The Borrower agrees to
pay all reasonable out-of-pocket expenses incurred by the Administrative
Agent, the Collateral Agent and the Issuing Bank in connection with the
syndication of the credit facilities provided for herein and the preparation
and administration of this Agreement (including the appraisal fees and the
cost of Phase I environmental studies) and the other Loan Documents or in
connection with any amendments, modifications or waivers of the provisions
hereof or thereof (whether or not the transactions hereby or thereby
contemplated shall be consummated) or incurred by
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the Administrative Agent, the Collateral Agent, the Issuing Bank or any
Lender in connection with the enforcement or protection of its rights in
connection with this Agreement and the other Loan Documents or in connection
with the Loans made or Letters of Credit issued hereunder, including the
fees, charges and disbursements of Rosenman & Colin LLP, counsel for the
Administrative Agent and the Collateral Agent, and, in connection with any
such enforcement or protection, the fees, charges and disbursements of any
other counsel for the Administrative Agent, the Collateral Agent, the Issuing
Bank or any Lender.
(b) The Borrower agrees to indemnify the Administrative Agent, the
Collateral Agent, the Issuing Bank and each Lender, each Affiliate of any of
the foregoing persons and each of their respective directors, officers,
employees and agents (each such person being called an "INDEMNITEE") against,
and to hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including reasonable counsel fees,
charges and disburse-ments, incurred by or asserted against any Indemnitee
arising out of, in any way connected with, or as a result of (i) the
execution or delivery of this Agreement or any other Loan Document or any
agreement or instrument contemplated thereby, the performance by the parties
thereto of their respective obligations thereunder or the consummation of the
Transactions and the other transactions contemplated thereby, (ii) the use of
the proceeds of the Loans or issuance of Letters of Credit, (iii) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto, or (iv) any actual or
alleged presence or Release of Hazardous Materials on any property owned or
operated by the Borrower or any of the Subsidiaries, or any Environmental
Claim related in any way to the Borrower or the Subsidiaries; PROVIDED that
such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or wilful misconduct of
such Indemnitee. In connection with any claim, litigation, investigation or
proceeding under this paragraph (b), the Indemnitees shall be represented by
only one New York counsel and by only one local counsel in each relevant
jurisdiction, unless such New York counsel determines that the interests of
such Indemnitees are in conflict.
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(c) The provisions of this Section 9.05 shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the expiration of the Commitments, the expiration
of any Letter of Credit, the invalidity or unenforceability of any term or
provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of the Administrative Agent, the Collateral Agent, the
Issuing Bank or any Lender. All amounts due under this Section 9.05 shall be
payable on written demand therefor accompanied by a reasonably detailed
description of the amounts due and the circumstances giving rise thereto.
SECTION 9.06. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each 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 to or for the credit or the account of the Borrower against any of and
all the obligations of the Borrower now or hereafter existing under this
Agreement and other Loan Documents held by such Lender, irrespective of
whether or not such Lender shall have made any demand under this Agreement or
such other Loan Document and although such obligations may be unmatured. The
rights of each Lender under this Section 9.06 are in addition to other rights
and remedies (including other rights of setoff) which such Lender may have.
Notwithstanding anything contained in this Section 9.06 or elsewhere in this
Agreement or in any other Loan Document, each Lender hereby expressly waives
any right of setoff it may have hereunder or otherwise in respect of any such
obligation against any Loan Party that has granted a Mortgage hereunder on
any real property located within the State of California, and such waiver
shall remain in full force and effect unless and until such Lender receives a
written authorization of the Required Lenders to the exercise of such right
of setoff. If any Lender shall exercise a right of setoff against any such
obligation in violation of the preceding sentence, such setoff shall be
deemed void, and such setoff shall be immediately rescinded and reversed by
such Lender.
SECTION 9.07. APPLICABLE LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS (OTHER THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER
LOAN DOCUMENTS) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE
105
STATE OF NEW YORK. EACH LETTER OF CREDIT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES DESIGNATED IN SUCH LETTER OF
CREDIT, OR IF NO SUCH LAWS OR RULES ARE DESIGNATED, THE UNIFORM CUSTOMS AND
PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF
COMMERCE, PUBLICATION NO. 500 (THE "UNIFORM CUSTOMS"), AS THE UNIFORM CUSTOMS
MAY BE AMENDED, AND, AS TO MATTERS NOT GOVERNED BY THE UNIFORM CUSTOMS, THE
LAWS OF THE STATE OF NEW YORK.
SECTION 9.08. WAIVERS; AMENDMENT. (a) No failure or delay of the
Administrative Agent, the Collateral Agent, the Issuing Bank or any Lender in
exercising any power or right hereunder or under any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise
of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof
or the exercise of any other right or power. The rights and remedies of the
Administrative Agent, the Collateral Agent, the Issuing Bank and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No
waiver of any provision of this Agreement or any other Loan Document or
consent to any departure by the Borrower or any other Loan Party therefrom
shall in any event be effective unless the same shall be permitted by
paragraph (b) below, and then such waiver or consent shall be effective only
in the specific instance and for the purpose for which given. No notice or
demand on the Borrower in any case shall entitle the Borrower to any other or
further notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders; PROVIDED, HOWEVER,
that no such agreement shall (i) decrease the principal amount of, or extend
the maturity of or any scheduled principal payment date or date for the
payment of any interest on any Loan or any date for reimbursement of an L/C
Disbursement, or waive or excuse any such payment or any part thereof, or
decrease the rate of interest on any Loan or L/C Disbursement, without the
prior written consent of each Lender affected thereby, (ii) change or extend
the Commitment or decrease the Commitment Fees of any Lender without the
prior written consent of such Lender, or (iii) amend, modify or waive the
provisions of this Section, Sections 2.09(a), 2.09(b)(i), 2.15 or
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9.04(i), or the proviso and the entire paragraph immediately thereafter
commencing with the word "Notwithstanding" and ending with the word "above"
immediately following clause (v) of Section 2.09(b), or amend or modify the
definitions of the terms "Additional Mortgaged Properties", "Allocated Loan
Value", "Income Producing Property" or "Required Lenders", or release any
Guarantor or all or any substantial part of the Collateral except as
expressly authorized by the Loan Documents, without the prior written consent
of each Lender; PROVIDED FURTHER that no such agreement shall amend, modify
or otherwise affect the rights or duties of the Administrative Agent, the
Collateral Agent or the Issuing Bank hereunder or under any other Loan
Document without the prior written consent of the Administrative Agent, the
Collateral Agent or the Issuing Bank.
SECTION 9.09. INTEREST RATE LIMITATION. Notwithstanding anything
herein to the contrary, if at any time the interest rate applicable to any
Loan or participation in any L/C Disbursement, together with all fees,
charges and other amounts which are treated as interest on such Loan or
participation in such L/C Disbursement under applicable law (collectively the
"CHARGES"), shall exceed the maximum lawful rate (the "MAXIMUM RATE") which
may be contracted for, charged, taken, received or reserved by the Lender
holding such Loan in accordance with applicable law, the rate of interest
payable in respect of such Loan hereunder, together with all Charges payable
in respect thereof, shall be limited to the Maximum Rate and, to the extent
lawful, the interest and Charges that would have been payable in respect of
such Loan but were not payable as a result of the operation of this Section
9.09 shall be cumulated and the interest and Charges payable to such Lender
in respect of other Loans or periods shall be increased (but not above the
Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Federal Funds Closing Rate to the date of repayment, shall
have been received by such Lender.
SECTION 9.10. ENTIRE AGREEMENT. This Agreement and the other Loan
Documents constitute the entire contract between the parties relative to the
subject matter hereof. Any other previous agreement among the parties with
respect to the subject matter hereof is superseded by this Agreement and the
other Loan Documents. Nothing in this Agreement or in the other Loan
Documents, expressed or implied, is intended to confer upon any party other
than the parties hereto and thereto any rights, remedies, obligations or
liabilities under or by reason of this Agreement or the other Loan Documents.
107
SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR
ANY OF THE OTHER LOAN DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 9.11.
SECTION 9.12. SEVERABILITY. In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should
be held invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein and
therein shall not in any way be affected or impaired thereby (it being
understood that the invalidity of a particular provision in a particular
jurisdiction shall not in and of itself affect the validity of such provision
in any other jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.
SECTION 9.13. COUNTERPARTS. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts),
each of which shall constitute an original but all of which when taken
together shall constitute a single contract, and shall become effective as
provided in Section 9.03. Delivery of an executed signature page to this
Agreement by facsimile transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement.
SECTION 9.14. HEADINGS. Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and are not to affect the construction of, or to be
taken into consideration in interpreting, this Agreement.
SECTION 9.15. JURISDICTION; CONSENT TO SERVICE OF PROCESS. (a)
The Borrower hereby irrevocably and unconditionally submits, for itself and
its property, to the nonex-
108
clusive jurisdiction of any New York State court or Federal court of the
United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to
this Agreement or the other Loan Documents, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the
extent permitted by law, in such Federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law. Nothing in this Agreement shall
affect any right that the Administrative Agent, the Collateral Agent or any
Lender may otherwise have to bring any action or proceeding relating to this
Agreement or the other Loan Documents against the Borrower or its properties
in the courts of any jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or the other Loan
Documents in any New York State or Federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service
of process in the manner provided for notices in Section 9.01. Nothing in
this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
SECTION 9.16. CONFIDENTIALITY. The Administrative Agent, the
Collateral Agent, the Issuing Bank and each of the Lenders agrees to keep
confidential (and to use its best efforts to cause its respective agents and
representatives to keep confidential) the Information (as defined below) and
all copies thereof, extracts therefrom and analyses or other materials based
thereon, except that the Administrative Agent, the Collateral Agent, the
Issuing Bank or any Lender shall be permitted to disclose Information (a) to
such of its respective officers, directors, employees, agents, affiliates and
representatives as need to know such Information, (b) to the extent requested
by any regulatory authority, (c) to the ex-
109
tent otherwise required by applicable laws and regulations or by any subpoena
or similar legal process, (d) in connection with any suit, action or
proceeding relating to the enforcement of its rights hereunder or under the
other Loan Documents or (e) to the extent such Information (i) becomes
publicly available other than as a result of a breach of this Section 9.16 or
(ii) becomes available to the Administrative Agent, any Lender, the Issuing
Bank or the Collateral Agent on a nonconfidential basis from a source other
than the Borrower or a Subsidiary. For the purposes of this Section,
"INFORMATION" shall mean all financial statements, certificates, reports,
agreements and information (including all analyses, compilations and studies
prepared by the Administrative Agent, the Collateral Agent, the Issuing Bank
or any Lender based on any of the foregoing) that are received from the
Borrower and related to the Borrower, any shareholder of the Borrower or any
employee, customer or supplier of the Borrower, other than any of the
foregoing that were available to the Administrative Agent, the Collateral
Agent, the Issuing Bank or any Lender on a nonconfidential basis prior to its
disclosure thereto by the Borrower, and which are in the case of Information
provided after the date hereof, clearly identified at the time of delivery as
confidential. The provisions of this Section 9.16 shall remain operative and
in full force and effect regardless of the expiration and term of this
Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as
of the day and year first above written.
CASTLE & XXXXX, INC.,
by /s/ XXXXXX X. XXXXXX
----------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President and
Chief Financial Officer
by /s/ XXXX X. XXXXXXX
----------------------------
Name: Xxxx X. Xxxxxxx
Title: Assistant Treasurer
THE CHASE MANHATTAN BANK (formerly
known as Chemical Bank),
by /s/ XXXX XXXXXXXXX XXXXX
----------------------------
Name: Xxxx Xxxxxxxxx Xxxxx
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION,
by /S/ XXXX XXXXXX
----------------------------
Name: Xxxx Xxxxxx
Title: Vice President
THE BANK OF NOVA SCOTIA,
SAN FRANCISCO AGENCY,
by /s/ XXXXX XXXXXX
----------------------------
Name: Xxxxx Xxxxxx
Title: Relationship Manager
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
by /s/ XXXXX X. BOTTLES
----------------------------
Name: Xxxxx X. Bottles
Title: Senior Vice President
000
XXXX XX XXXXXX
by /s/ XXXX X. XXXX
----------------------------
Name: Xxxx X. Xxxx
Title: Vice President
FIRST NATIONAL BANK OF CHICAGO,
by /s/ XXXXXXX X. XXXXXX
----------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Corporate Banking Officer
SOCIETE GENERALE,
by /s/ X. XXXXXX XXXXXXX
----------------------------
Name: X. Xxxxxx Xxxxxxx
Title: Vice President
112
