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EXHIBIT 10.01
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FGIC SECURITIES PURCHASE, INC.
AND
GENERAL ELECTRIC CAPITAL CORPORATION
STANDBY LOAN AGREEMENT
Dated as of __________, _____
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS................................................................................1
SECTION 1.1 Definitions.......................................................................1
ARTICLE II LOAN PROVISIONS............................................................................3
SECTION 2.1 Commitment........................................................................3
SECTION 2.2 Amount and Purpose of Loans.......................................................3
SECTION 2.3 Borrowing Procedures..............................................................3
SECTION 2.4 Disbursement of Funds.............................................................3
ARTICLE III COMMITMENT.................................................................................4
SECTION 3.1 Commitment Fees...................................................................4
SECTION 3.2 Reduction or Termination of the Commitment........................................5
ARTICLE IV PAYMENTS...................................................................................5
SECTION 4.1 Voluntary Prepayments.............................................................5
SECTION 4.2 Mandatory Prepayments.............................................................5
SECTION 4.3 Repayment of Loans by Transfer of Tendered Bonds..................................5
SECTION 4.4 Payments..........................................................................6
ARTICLE V REPRESENTATIONS AND WARRANTIES.............................................................6
SECTION 5.1 Representations and Warranties of the Borrower....................................6
SECTION 5.2 Representations and Warranties of GE Capital......................................7
ARTICLE VI COVENANTS..................................................................................8
SECTION 6.1 Covenants of the Borrower.........................................................8
SECTION 6.2 Covenants of GE Capital...........................................................9
ARTICLE VII CONDITIONS PRECEDENT.......................................................................9
SECTION 7.1 Conditions Precedent to Effectiveness.............................................9
ARTICLE VIII EVENTS OF DEFAULT.........................................................................10
SECTION 8.1 Events of Default................................................................10
ARTICLE IX MISCELLANEOUS.............................................................................11
SECTION 9.1 No Waiver; Modifications in Writing..............................................11
SECTION 9.2 Payment on Non-Business Days.....................................................11
SECTION 9.3 Further Assurances...............................................................11
SECTION 9.4 Survival of Representations and Warranties.......................................11
SECTION 9.5 Notices, etc.....................................................................11
SECTION 9.6 Costs, Expenses and Taxes........................................................12
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SECTION 9.7 No GE Capital Liability..........................................................12
SECTION 9.8 Term of this Agreement...........................................................12
SECTION 9.9 Execution in Counterparts........................................................12
SECTION 9.10 Binding Effect; Assignment.......................................................12
SECTION 9.11 Governing Law....................................................................13
SECTION 9.12 Severability of Provisions.......................................................13
SECTION 9.13 Headings.........................................................................13
EXHIBIT A - Form of Notice of Borrowing
EXHIBIT B - Form of Note
EXHIBIT C - Borrower's Opinion of Counsel
EXHIBIT D - GE Capital's Opinion of Counsel
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EXHIBIT 10.01
STANDBY LOAN AGREEMENT
STANDBY LOAN AGREEMENT dated as of __________, ____, between
FGIC Securities Purchase, Inc., a Delaware corporation (the "Borrower"), and
General Electric Capital Corporation, a New York corporation ("GE Capital").
WHEREAS, the Borrower desires to borrow amounts from GE
Capital from time to time for the purpose of paying the purchase price of
Tendered Bonds (as defined herein) and GE Capital is prepared to make such loans
upon the terms hereof;
NOW THEREFORE, in consideration of the respective agreements
contained herein, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. The following terms as used in this Agreement
shall have the following meanings, unless the context otherwise requires:
"Agreement" shall mean this Standby Loan Agreement, as the
same may from time to time be amended or supplemented.
"Available Commitment" shall mean, at the time any
determination thereof is to be made, the amount of the Commitment adjusted as
follows: (i) downward by an amount equal to _________% of the aggregate
principal amount of all Tendered Bonds purchased by the Borrower with the
proceeds of Loans made under this Agreement and (ii) upward by an amount equal
to __________% of the aggregate principal amount of Tendered Bonds which have
been sold by the Borrower in a remarketing pursuant to Section 2.04 of the
Standby Bond Purchase Agreement, the proceeds of which have been delivered to GE
Capital as a prepayment of Loans as required by Section 4.2 of this Agreement.
"Base Rate" shall mean for any day the Prime Rate for such day
plus 1%; provided that the Base Rate shall at no time exceed the lesser of (a)
25% per annum and (b) the maximum rate permitted by applicable law.
"Bonds" shall mean the ______________________________________,
Series _____________, of the Issuer in an aggregate principal amount not to
exceed $_____________.
"Borrowing" shall mean the incurrence of a Loan by the
Borrower from GE Capital pursuant to Section 2.3 hereof.
"Borrowing Date" shall mean the date on which a Borrowing is,
or is to be, consummated, as the context may indicate; provided that in no event
shall the Borrowing Date be (i) on the same day the Notice of Borrowing is
received if the Notice of Borrowing is received by GE Capital later than 1:00
p.m. (New York City time), in which case the Borrowing Date shall be the next
succeeding Business Day or (ii) after the last day of the Commitment Period.
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"Business Day" shall mean a day other than a Saturday, Sunday
or other day on which the New York Stock Exchange or banks are authorized or
obligated by law or executive order to close in New York, New York or any city
in which is located the principal corporate trust officer of the Trustee or the
office of the Borrower at which demands for the payment with respect to Tendered
Bonds will be made.
"Commitment" shall mean, initially $___________, and
thereafter, at the time any determination thereof is to be made, such initial
amount reduced by the amount of any permanent reduction(s) in such amount made
pursuant to Section 3.2 hereof.
"Commitment Fee" shall have the meaning assigned to that term
in Section 3.1 hereof.
"Commitment Period" shall mean the period commencing with and
including the Effective Date and ending on and including the Commitment
Termination Date.
"Commitment Termination Date" shall mean the date which is
five years from the Effective Date; provided that if such date is not a Business
Day, the Business Day immediately succeeding such date.
"Default" shall mean an event, act or occurrence which with
the giving of notice or the lapse of time (or both) would become an Event of
Default.
"Effective Date" shall have the meaning assigned to such term
in Section 7.1 hereof.
"Event of Default" shall have the meaning assigned to that
term in Section 8.1 hereof.
"Issuer" shall mean the _________________________, a _______
of the _______________________________________________.
"Loan" or "Loans" shall have the meaning provided in Section
2.1.
"Note" shall have the meaning provided in Section 2.5.
"Notice of Borrowing" shall have the meaning provided in
Section 2.3.
"Person" shall mean an individual or a corporation,
partnership, trust, firm, incorporated or unincorporated association, joint
venture, joint stock company, unincorporated organization, government (or an
agency or political subdivision thereof) or other entity of any kind.
"Prime Rate" shall mean the rate of interest publicly
announced by Xxxxxx Guaranty Trust Company of New York from time to time as its
Prime Rate.
"Remarketing Agent" means the entity designated as such in the
Bonds and its permitted successors and assigns.
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"Remarketing Agreement" shall mean the Remarketing Agreement
between the Issuer and the Remarketing Agent relating to the Bonds.
"Standby Bond Purchase Agreement" shall mean the Standby Bond
Purchase Agreement, dated as of the date hereof, between the Borrower and the
Trustee.
"Tender Agent" shall mean the entity designated as such in the
Bonds and its permitted successors and assigns.
"Tendered Bonds" shall mean Bonds tendered or deemed tendered
to the Tender Agent for purchase pursuant to the terms of the Bonds and for
which the Borrower has received a notice of purchase pursuant to Section 2.02 of
the Standby Bond Purchase Agreement.
"Transfer Notice" shall have the meaning provided in Section
4.3.
"Trustee" shall mean Chase Manhattan Trust Company, National
Association, and its permitted successors and assigns.
ARTICLE II
LOAN PROVISIONS
SECTION 2.1 Commitment. Upon the terms and subject to the conditions of
this Agreement, GE Capital will make loans (each a "Loan" and, collectively, the
"Loans") to the Borrower during the Commitment Period, in an aggregate principal
amount outstanding at any time up to but not exceeding the Commitment.
SECTION 2.2 Amount and Purpose of Loans. Each Loan shall be in an amount
not exceeding the purchase price for Tendered Bonds which represents the
outstanding principal amount of such Tendered Bonds together with accrued
interest thereon to but excluding the Borrowing Date, and each Loan shall mature
on the Commitment Termination Date. The proceeds of each Loan shall be used only
for the purpose of paying such purchase price for Tendered Bonds.
SECTION 2.3 Borrowing Procedures. Whenever the Borrower desires to make a
Borrowing hereunder, its duly authorized representative shall give GE Capital at
its office located at 000 Xxxx Xxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx 00000;
Attention: Senior Vice President - Corporate Treasury and Global Funding
Operation, Telecopy: 000-000-0000, prior written notice of such Borrowing by at
least 11:45 a.m., New York City time, on the proposed Borrowing Date. Each such
notice (each a "Notice of Borrowing") shall be substantially in the form of
Exhibit A attached hereto, and shall specify the aggregate principal amount the
Borrower desires to borrow hereunder, the aggregate principal amount of Tendered
Bonds being purchased with the proceeds of such Borrowing, the proposed
Borrowing Date (which shall be a Business Day), the place where the proceeds of
such Borrowing shall be made available and whether the Borrowing is to be made
available in immediately available or next-day funds.
SECTION 2.4 Disbursement of Funds. No later than 2:15 p.m. (New York City
time) on each Borrowing Date (if the related Notice of Borrowing has been
received by 11:45
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a.m. (New York City time) on such date), GE Capital will make available the
amount of the Borrowing requested to be made on such date in U.S. dollars, in
the funds specified in the Notice of Borrowing and pursuant to the instructions
specified in the Notice of Borrowing.
SECTION 2.5 Note. (a) The Borrower's obligation to pay the principal of,
and interest on, the Loans shall be evidenced by a single promissory note (the
"Note") substantially in the form of Exhibit B hereto with the blanks
appropriately completed in conformity herewith. The Note shall (i) be payable to
the order of GE Capital (ii) be dated the date of this Agreement, (iii) be in a
stated principal amount equal to the Commitment on the date of issuance, (iv) be
payable in the principal amount of the Loans evidenced thereby, (v) mature on
the Commitment Termination Date, (vi) bear interest as provided in Section 2.6
in respect of the Loans evidenced thereby, and (vii) be entitled to the benefits
of this Agreement.
(b) The date and amount of each Loan made by GE Capital and of each
repayment of principal thereon received by GE Capital shall be recorded by GE
Capital on the Loan and Repayment Schedule attached to the Note, and the
aggregate unpaid principal amount shown on such Schedule shall be rebuttable
presumptive evidence of the principal amount owing and unpaid on such Note. The
failure to record or any error in recording any such amount on such Schedule
shall not, however, limit, increase or otherwise affect the obligations of the
Borrower hereunder or under the Note to repay the outstanding principal amount
of the Loans together with all interest accruing thereon.
SECTION 2.6 Interest. (a) The Borrower agrees to pay interest in respect of
the unpaid principal amount of each Loan at a rate per annum which shall be the
Base Rate in effect from time to time.
(b) Interest shall be calculated on the basis of a year of 365 days (or
on 366 days in a leap year) and paid for the actual number of days elapsed to
the day of payment.
(c) Overdue principal and overdue interest in respect of each Loan
shall bear interest at a rate per annum equal to the lesser of (i) 2% in excess
of the Base Rate in effect from time to time, (ii) 25% and (iii) the maximum
rate permitted by applicable law.
(d) Interest shall accrue from and including the date of any Borrowing
to but excluding the date of any repayment thereof and shall be payable on the
first day of each calendar month and on any prepayment or at maturity (whether
by acceleration or otherwise), and after such maturity, on demand.
ARTICLE III
COMMITMENT
SECTION 3.1 Commitment Fees. (a) In consideration of the commitment of GE
Capital to make Loans to the Borrower under the terms hereof, the Borrower
hereby agrees to pay GE Capital a fee (herein called the "Commitment Fee") which
shall be in the amounts, and shall be payable on the dates, mutually agreed to
by the Borrower and GE Capital.
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(b) In addition, the Borrower shall pay GE Capital on the Effective
Date an initial fee in an amount mutually agreed to by the Borrower and GE
Capital.
SECTION 3.2 Reduction or Termination of the Commitment. (a) The Borrower
shall have the right at any time and from time to time, to permanently reduce in
part, or to terminate in whole, without penalty or premium, the Commitment upon
not less than one Business Day prior notice (by telex, telegram or telecopier)
received by GE Capital, designating the date (which shall be a Business Day) of
such reduction or termination and the amount of any partial reduction. Such
partial reduction or termination of the Commitment shall be effective on the
date specified in the Borrower's aforesaid notice.
(b) GE Capital and the Borrower hereby agree that neither of them will
exercise any right to terminate this Agreement pursuant to Section 3.2(a) hereof
so long as any obligations pursuant to Section 2.01 of the Standby Bond Purchase
Agreement remain outstanding; provided, that if the Borrower exercises any
termination right under Section 2.03 of the Standby Bond Purchase Agreement, the
result of which is to terminate the Commitment thereunder (and as defined
therein), a termination hereof may be effected.
ARTICLE IV
PAYMENTS
SECTION 4.1 Voluntary Prepayments. The Borrower shall have the right to
prepay the Loans in whole or in part, without premium or penalty, from time to
time upon at least one Business Day prior written notice (or telephonic notice
confirmed in writing).
SECTION 4.2 Mandatory Prepayments. In the event any Tendered Bonds
purchased by the Borrower with the proceeds of Loans made available hereunder
are either (i) remarketed in accordance with the terms of the Remarketing
Agreement, (ii) sold by the Borrower (other than pursuant to a remarketing as
described in clause (i) above) to a party or parties other than GE Capital or
(iii) redeemed or otherwise paid by or on behalf of the Issuer, the Borrower
shall immediately (in no event later than the next Business Day) deliver, or
cause to be delivered, to GE Capital the purchase price for such Tendered Bonds.
Upon receipt of such payment GE Capital shall apply such payment as a prepayment
of the Loans, such amount to be applied first to reduce any interest accrued but
unpaid on the Loans and then applied to reduce the principal amount of any Loans
then outstanding. In connection with any prepayment made in accordance with
clause (i) above, the Borrower shall include with such prepayment a notice
specifying the aggregate principal amount of Tendered Bonds which were sold in
the remarketing giving rise to such prepayment.
SECTION 4.3 Repayment of Loans by Transfer of Tendered Bonds. (a) GE
Capital shall have the right, in its sole discretion, at any time during the
term of this Agreement, to give written notice (each a "Transfer Notice") to the
Borrower requesting that the Borrower transfer to GE Capital, in satisfaction of
the payment of outstanding Loans, Tendered Bonds then held by the Borrower. Upon
receipt of such notice, the Borrower shall immediately (in no event
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later than the next Business Day) transfer, or cause to be transferred, to (or
at the direction of) GE Capital such Tendered Bonds at the address specified in
the Transfer Notice. GE Capital shall treat the receipt of the aggregate
principal amount of such Tendered Bonds plus accrued interest thereon as a
prepayment of the Loans, such amount to be applied first to reduce any interest
accrued but unpaid on the Loans and then applied to reduce the principal amount
of any Loans then outstanding.
(b) On the Commitment Termination Date, the Borrower shall have the
right to deliver, or cause to be delivered, to (or at the direction of) GE
Capital all Tendered Bonds then held by the Borrower in payment for all or any
portion of the Loans outstanding on such date. GE Capital shall treat the
receipt of the aggregate principal amount of such Tendered Bonds plus accrued
interest thereon as a repayment of the Loans, such amount to be applied first to
reduce any interest accrued but unpaid on the Loans and then applied to reduce
the principal amount of the Loans then outstanding.
(c) GE Capital expressly reserves the right to sell Tendered Bonds
received by it pursuant to this Section 4.3. Any Tendered Bonds sold by GE
Capital pursuant to this Section 4.3 shall bear interest at the same rate and be
subject to the same terms and conditions as applied prior to such Bonds'
becoming Tendered Bonds; provided, however, that Tendered Bonds shall not be
entitled to the benefits of tender and purchase under Sections 2.01 and 2.02 of
the Standby Bond Purchase Agreement.
(d) For purposes of this Section 4.3, the aggregate principal amount of
Tendered Bonds shall mean the aggregate face amount of such Tendered Bonds.
SECTION 4.4 Payments. All payments to be made by or on behalf of the
Borrower to GE Capital hereunder (other than as contemplated under Section 4.3
above), whether on account of principal or interest on the Loans, the Commitment
Fee or other amounts at any time owing hereunder or in connection herewith,
shall be made to GE Capital at Bankers Trust Company - New York, Account Number
00-000-000, in immediately available funds. All such payments shall be made to
GE Capital not later than noon, New York City time, on the date due; and funds
received by GE Capital as aforesaid after that hour shall be deemed to have been
received by GE Capital on the next succeeding Business Day.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.1 Representations and Warranties of the Borrower. The Borrower
represents and warrants to GE Capital as follows:
(a) Corporate Status. The Borrower is a corporation duly organized and
validly existing in good standing under the laws of the State of Delaware. The
Borrower is duly qualified to transact business and is in good standing in the
jurisdictions in which the conduct of its business or the ownership of its
property requires such qualification.
(b) Power and Authorization. The Borrower has the corporate power and
authority (i) to execute, deliver and perform this Agreement and the Note, (ii)
to issue the Note
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in the manner and for the purpose contemplated by this Agreement, and (iii) to
execute, deliver and perform all other agreements and instruments to be executed
and delivered by the Borrower pursuant to or in connection with this Agreement.
(c) No Violation. The execution, delivery and performance by the
Borrower of this Agreement, the issuance of the Note in the manner and for the
purpose contemplated by this Agreement and the execution, delivery and
performance by the Borrower of all other agreements and instruments to be
executed and delivered by the Borrower pursuant hereto or thereto or in
connection herewith or therewith (i) will not violate any provision of the
Certificate of Incorporation or By-Laws of the Borrower or any applicable law or
regulation or any order, writ, judgment or decree of any court, arbitrator or
governmental authority, and (ii) will not violate any provision of, constitute a
default under, or result in the creation or imposition of any lien on any of the
assets of the Borrower pursuant to the provisions of any mortgage, indenture,
contract, agreement or other undertaking to which the Borrower is a party or
which purports to be binding upon the Borrower or upon any of its assets.
(d) Governmental Approvals. No order, consent, approval, license,
authorization or validation of, or filing, recording or registration with
(except as will have been obtained or made prior to the Effective Date), or
exemption by, any governmental or public body or authority, or any subdivision
thereof, is required to authorize, or is required in connection with, (i) the
execution, delivery and performance by the Borrower of this Agreement or the
Note or (ii) the legality, validity, binding effect or enforceability against
the Borrower of this Agreement or the Note.
(e) Enforceability. This Agreement has been duly authorized, executed
and delivered by the Borrower. This Agreement constitutes, and each other
agreement or instrument executed and delivered by the Borrower pursuant hereto
or in connection herewith will constitute, and the Note, when executed by the
Borrower, will be duly issued and will constitute, the legal, valid and binding
obligation of the Borrower enforceable against the Borrower in accordance with
its respective terms, except as the enforcement thereof may be limited by
bankruptcy and other similar laws of general application relating to creditors'
rights or general principles of equity.
SECTION 5.2 Representations and Warranties of GE Capital. GE Capital
represents and warrants to the Borrower as follows:
(a) Corporate Status. GE Capital is a corporation duly organized and
validly existing in good standing under the laws of the State of New York.
(b) Power and Authorization. GE Capital has the corporate power and
authority (i) to execute, deliver and perform this Agreement and (ii) to
execute, deliver and perform all other agreements and instruments to be executed
and delivered by GE Capital pursuant to or in connection with this Agreement.
(c) No Violation. The execution, delivery and performance by GE Capital
of this Agreement and the execution, delivery and performance by GE Capital of
all other agreements and instruments to be executed and delivered by GE Capital
pursuant hereto or in
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connection herewith, (i) will not violate any provision of the Organization
Certificate or By-Laws of GE Capital or any applicable law or regulation or any
order, writ, judgment or decree of any court, arbitrator or governmental
authority, and (ii) will not violate any provision of, or constitute a default
under, any mortgage, indenture, contract, agreement or other undertaking to
which GE Capital is a party or which purports to be binding upon GE Capital or
upon any of its assets.
(d) Governmental Approvals. No order, consent, approval, license,
authorization or validation of, or filing, recording or registration with
(except as have been obtained or made prior to the Effective Date), or exemption
by, any governmental or public body or authority, or any subdivision thereof, is
required to authorize, or is required in connection with, (i) the execution,
delivery and performance of this Agreement by GE Capital or (ii) the legality,
validity, binding effect or enforceability of this Agreement against GE Capital.
(e) Enforceability. This Agreement has been duly authorized, executed
and delivered by GE Capital. This Agreement constitutes, and each other
agreement or instrument executed and delivered by GE Capital pursuant hereto or
in connection herewith will constitute, the legal, valid and binding obligation
of GE Capital enforceable against GE Capital in accordance with its respective
terms, except as the enforcement thereof may be limited by bankruptcy and other
similar laws of general application relating to creditors' rights or general
principles of equity.
ARTICLE VI
COVENANTS
SECTION 6.1 Covenants of the Borrower. The Borrower covenants and agrees
that so long as any Loans shall remain unpaid or GE Capital shall have any
Commitment hereunder:
(a) Use of Proceeds. The Borrower will use the proceeds of the Loans
solely for the purposes set forth in Section 2.2.
(b) Dividend Limitation. The Borrower will not declare or pay any
dividend in respect of, or make any distribution in respect of, or redemption
of, any shares of its capital stock.
(c) Liens. The Borrower will not contract for, create, incur, assume or
suffer to exist any lien, security interest, charge or other encumbrance of any
nature upon any of its property or assets, whether now owned or hereafter
acquired.
(d) Other Debt. The Borrower will not, without the prior written
consent of GE Capital, create, incur, assume or suffer to exist any
indebtedness, whether current or funded, or any other liability except
indebtedness owed to GE Capital.
(e) Guarantees, Loans, Advances and Other Liabilities. Except as
contemplated by the Standby Bond Purchase Agreement, the Borrower will not,
without the prior written consent of GE Capital, make any loan or advance or
credit to, or guarantee (directly or indirectly or by an instrument having the
effect of assuring another's payment or performance on
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any obligation or capability of so doing or otherwise), endorse or otherwise
become contingently liable, directly or indirectly, in connection with the
obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or
agree contingently to do so) any stock, obligations, assets or securities of, or
any other interest in, or make any capital contribution to, any other Person.
(f) Consolidation, Merger and Sale of Assets. The Borrower will not
enter into any merger, consolidation, joint venture, syndicate or other form of
combination with any Person, or sell, lease or transfer or otherwise dispose of
any of its assets (other than the sale of Tendered Bonds in a remarketing
permitted by Section 2.04(b) of the Standby Bond Purchase Agreement) or engage
in any other transaction which would result in a change of control of the
Borrower.
(g) Capital Expenditures. The Borrower will not make any expenditure
(by long-term or operating lease or otherwise) for capital assets (both realty
and personalty).
(h) Other Business. The Borrower will not, without the prior written
consent of GE Capital, engage in any business or enterprise or enter into any
material transaction which is of a type different than that which is
contemplated by this Agreement and the Standby Bond Purchase Agreement.
(i) Amendment of Certificate of Incorporation or By-Laws. The Borrower
will not amend its Certificate of Incorporation or By-Laws without the prior
written consent of GE Capital.
(j) Good Standing. The Borrower will maintain its corporate existence
as a corporation validly existing and in good standing under the laws of the
State of Delaware.
(k) No Changes in Documents. The Borrower will not amend, supplement,
modify or waive any of the provisions of the Standby Bond Purchase Agreement or
consent to any amendment, supplement, modification or waiver of any Related
Document (as defined in the Standby Bond Purchase Agreement), unless the
Borrower shall have obtained the prior written consent of GE Capital.
SECTION 6.2 Covenants of GE Capital. GE Capital covenants and agrees that,
prior to the date which is one year and one day after the Commitment hereunder
has been terminated, GE Capital will not institute against, or join any other
Person in instituting against, the Borrower any bankruptcy, reorganization
arrangement, insolvency or liquidation proceedings or other similar proceedings
under the laws of the United States of America or any state of the United States
of America.
ARTICLE VII
CONDITIONS PRECEDENT
SECTION 7.1 Conditions Precedent to Effectiveness. This Agreement shall
become effective on the earliest date (the "Effective Date") on which each of
the following conditions shall have been satisfied; provided that the Effective
Date shall occur no later than _______________;
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(a) Agreement. GE Capital and the Borrower each shall have signed and
delivered a counterpart of this Agreement.
(b) The Note. The Borrower shall have executed and delivered to GE
Capital a Note in the form set forth in Exhibit B.
(c) Opinion of Borrower's Counsel. GE Capital shall have received an
opinion of Managing Counsel of Financial Guaranty Insurance Company, an
affiliate of the Borrower, dated the Effective Date, to the effect set forth in
Exhibit C attached hereto.
(d) Opinion of GE Capital's Counsel. The Borrower shall have received
an opinion of either the Senior Vice President, General Counsel and Secretary of
GE Capital or the Associate General Counsel, Treasury Operations and Assistant
Secretary of GE Capital, dated the Effective Date, to the effect set forth in
Exhibit D attached hereto.
(e) Effectiveness of Standby Bond Purchase Agreement. The Standby Bond
Purchase Agreement shall have become effective.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1 Events of Default. If the following events, acts or occurrences
(each herein called an "Event of Default") shall occur:
the Borrower shall commence a voluntary case concerning itself under Title
11 of the United States Code entitled "Bankruptcy," as now or hereafter in
effect, or any successor thereto (the "Bankruptcy Code"); or an involuntary
case is commenced against the Borrower and the petition is not controverted
within 10 days, or is not dismissed within 60 days, after commencement of
the case; or a custodian (as defined in the Bankruptcy Code) is appointed
for, or takes charge of, all or substantially all of the property of the
Borrower, or the Borrower commences any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency or liquidation or similar law of any jurisdiction
whether now or hereafter in effect relating to the Borrower, or there is
commenced against the Borrower any such proceeding which remains
undismissed for a period of 60 days, or the Borrower is adjudicated
insolvent or bankrupt; or any order of relief or other order approving any
such case or proceeding is entered; or the Borrower suffers any appointment
of any custodian or the like for it or any substantial part of its property
to continue undischarged or unstayed for a period of 60 days; or the
Borrower makes a general assignment for the benefit of creditors; or any
corporate action is taken by the Borrower for the purpose of effecting any
of the foregoing;
then all sums then owing by the Borrower hereunder and under the Note shall
automatically become and be immediately due and payable without presentment,
demand, protest or notice of any kind, all of which are hereby expressly waived
by the Borrower.
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ARTICLE IX
MISCELLANEOUS
SECTION 9.1 No Waiver; Modifications in Writing. No failure or delay on the
part of GE Capital in exercising any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy preclude any other or further exercise thereof or
the exercise of any other right, power or remedy. The remedies provided for
herein are cumulative and are not exclusive of any remedies that may be
available to GE Capital at law or in equity or otherwise. No amendment,
modification, supplement, termination or waiver of or to any provision of this
Agreement, nor consent to any departure by the Borrower therefrom, shall be
effective unless the same shall be in writing and signed by or on behalf of GE
Capital. Any amendment, modification or supplement of or to any provision of
this Agreement, and any consent to any departure by the Borrower from the terms
of any provision of this Agreement, shall be effective only in the specific
instance and for the specific purpose for which made or given. No notice to 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.
SECTION 9.2 Payment on Non-Business Days. Whenever any payment to be made
hereunder shall be due on a day which is not a Business Day, then such payment
shall be made on the next succeeding Business Day.
SECTION 9.3 Further Assurances. The Borrower agrees to do such further acts
and things and to execute and deliver to GE Capital such additional assignments,
agreements, powers and instruments, as GE Capital may require or deem advisable
to carry into effect the purposes of this Agreement or to better assure and
confirm unto GE Capital its rights, powers and remedies hereunder.
SECTION 9.4 Survival of Representations and Warranties. All agreements,
representations and warranties made in this Agreement and in any certificates
delivered pursuant hereto shall survive the execution and delivery of this
Agreement and the making of the Loans hereunder, and the agreements contained in
Sections 9.3 and 9.6 hereof shall survive payment of the Note and the
termination of this Agreement.
SECTION 9.5 Notices, etc. Except where telephonic instructions or notices
are authorized herein to be given, all notices, demands, instructions and other
communications required or permitted to be given to or made upon any party
hereto or any other Person shall be in writing and shall be personally delivered
or sent by registered or certified mail or overnight courier, postage prepaid,
or by telecopy, and shall be deemed to be given for purposes of this Agreement
on the day that such writing is delivered to the intended recipient thereof in
accordance with the provisions of this Section. Unless otherwise specified in a
notice sent or delivered in accordance with the foregoing provisions of this
Section, notices, demands, instructions and other communications in writing
shall be given to or made upon the respective parties hereto at their respective
addresses (or to their respective telecopy numbers) indicated below, and, in the
case of telephonic instructions or notices, by calling the telephone number or
numbers indicated for such party below:
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Page 12
If to the Borrower:
FGIC Securities Purchase, Inc.
c/o Financial Guaranty Insurance Company
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Senior Counsel - Public Finance
Telecopy No.: 000-000-0000
Tel. No.: 000-000-0000
If to GE Capital:
General Electric Capital Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Senior Vice President - Corporate
Treasury and Global Funding Operation
Telecopy No.: 000-000-0000
Tel. No.: 000-000-0000
SECTION 9.6 Costs, Expenses and Taxes. The Borrower agrees to pay promptly
all costs and expenses in connection with the preparation, issuance, delivery,
filing, recording, and administration of this Agreement, the Note, and any other
documents which may be delivered in connection with this Agreement, including,
without limitation, the reasonable out-of-pocket expenses of GE Capital and the
fees and expenses of its counsel, and all costs and expenses (including counsel
fees and expenses) in connection with (i) the modification, extension, change in
terms, maintenance, renewal or termination of the Commitment or (ii) the
enforcement of this Agreement or the Note.
SECTION 9.7 No GE Capital Liability. This Agreement is not, and shall not
be construed to be, a guarantee by GE Capital of the Bonds or of the Borrower's
obligations under the Standby Bond Purchase Agreement. GE Capital shall not have
any responsibility for, or incur any liability in respect of, any act, or any
failure to act, by the Borrower which results in the failure of the Borrower to
effect the purchase for the account of the Borrower of Tendered Bonds with the
funds provided pursuant to this Agreement.
SECTION 9.8 Term of this Agreement. Subject to Section 9.4 hereof, the term
of this Agreement shall be until the termination of the Commitment in its
entirety.
SECTION 9.9 Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original and all of which counterparts, taken together, shall
constitute but one and the same Agreement.
SECTION 9.10 Binding Effect; Assignment. This Agreement shall be binding
upon, and inure to the benefit of, the Borrower and GE Capital and their
respective successors and assigns; provided, however, that the Borrower may not
assign its rights or obligations hereunder without the prior written consent of
GE Capital. GE Capital may assign its rights or obligations
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Page 13
hereunder without the prior written consent of the Borrower provided that the
assignment does not result in a reduction in the short term credit rating of the
liquidity obligation evidenced and contemplated by under the Standby Bond
Purchase Agreement, the proceeds of drawings under which enable the Borrower to
pay the purchase price of Bonds tendered for purchase. This Agreement shall not
be construed so as to confer any right or benefit upon any Person other than the
parties to this Agreement and their respective successors and permitted assigns.
SECTION 9.11 Governing Law. This Agreement and the Note shall be deemed to
be a contract made under the laws of the State of New York and for all purposes
shall be construed in accordance with the laws of said State.
SECTION 9.12 Severability of Provisions. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
SECTION 9.13 Headings. Article and Section headings used in this Agreement
are for convenience of reference only and shall not affect the construction of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
FGIC SECURITIES PURCHASE, INC.
By____________________________
Vice President
GENERAL ELECTRIC CAPITAL CORPORATION
By____________________________
Name:
Senior Vice President - Corporate
Treasury and Global Funding Operation
17
EXHIBIT A
FORM OF NOTICE OF BORROWING
__________________, ______
General Electric Capital Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Senior Vice President - Corporate Treasury
and Global Funding Operation
Gentlemen:
Pursuant to Section 2.3 of the Standby Loan Agreement dated as
of January 20, 2000 (the "Standby Loan Agreement") between FGIC Securities
Purchase, Inc. (the "Borrower") and General Electric Capital Corporation ("GE
Capital"), the Borrower hereby confirms that on ________ __, 20__ it requested
that GE Capital make a Loan in the principal amount of $_______________ on
________ __, 20__, which is a Business Day.
The Loan requested hereby is for the sole purpose of paying
the purchase price for Tendered Bonds which represents the aggregate outstanding
principal amount of such Tendered Bonds in the amount of $__________ together
with accrued interest thereon.
You are hereby requested to disburse the Loan requested hereby
to account #__________ maintained at the office of [__________________________]
in immediately available funds.
Each capitalized term used herein shall have the meaning
ascribed thereto in the Standby Loan Agreement.
Very truly yours,
FGIC SECURITIES PURCHASE, INC.
By____________________________
Title_______________________
18
EXHIBIT B
FORM OF NOTE
$______________ _____________, 20__
FOR VALUE RECEIVED, FGIC SECURITIES PURCHASE, INC., a
corporation organized under the laws of the State of Delaware (the "Borrower"),
hereby promises to pay to the order of GENERAL ELECTRIC CAPITAL CORPORATION ("GE
Capital"), in lawful money of the United States of America in immediately
available funds on [Commitment Termination Date] (or, if such date is not a
Business Day, the Business Day immediately succeeding such date), the principal
sum of ________________________________, or, if less, the unpaid principal
amount of all Loans made by GE Capital pursuant to, and as defined in, the
Standby Loan Agreement referred to below. (All capitalized terms used herein
shall have the meanings set forth in such Standby Loan Agreement.)
The Borrower promises also to pay interest on the unpaid
principal amount hereof in like money from the date hereof until paid at the
rates and at the times provided in the Standby Loan Agreement.
This Note is the Note referred to in the Standby Loan
Agreement dated as of ____________, 20__ between the Borrower and GE Capital (as
the same may from time to time be amended or supplemented, the "Standby Loan
Agreement") and is entitled to the benefits thereof and shall be subject to the
provisions thereof. As provided in the Standby Loan Agreement, this Note is
subject to prepayment in whole or in part.
In case an Event of Default (as defined in the Standby Loan
Agreement) shall occur and be continuing, the principal of and accrued interest
on this Note may be declared to be due and payable in the manner and with the
effect provided in the Standby Loan Agreement.
The Borrower hereby waives presentment, demand, protest or
notice of any kind in connection with this Note.
19
EXHIBIT B
Page 2
This Note shall be construed in accordance with and be
governed by the laws of the State of New York.
FGIC SECURITIES PURCHASE, INC.
By____________________________
20
EXHIBIT B
Page 3
Schedule attached to the Note, dated _____________, 20__, of
FGIC Securities Purchase, Inc.
======================================================================================================================
LOAN AND REPAYMENT SCHEDULE
======================================================================================================================
------------------------- ---------------------- ----------------------- ---------------------- ======================
Date Amount of Loan Made Amount of Principal Unpaid Principal Name of Person
Repaid Balance Making Notation
------------------------- ---------------------- ----------------------- ---------------------- ======================
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21
EXHIBIT C
[FORM OF BORROWER'S OPINION OF COUNSEL]
General Electric Capital Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Dear Sirs:
I am [counsel] for FGIC Securities Purchase, Inc. (the "Borrower") and
in such capacity I have acted for the Borrower in connection with the Standby
Loan Agreement (the "Loan Agreement") dated as of January 20, 2000, between the
Borrower and General Electric Capital Corporation. Terms defined in the Loan
Agreement are used herein as therein defined. This opinion is being rendered to
you pursuant to Section 7.1(c) of the Loan Agreement.
I have examined such documents, certificates, orders and proceedings
and have made such investigation as I have deemed necessary or appropriate for
purposes of this opinion.
Upon the basis of the foregoing, I am of the opinion that:
1. The Borrower has been duly incorporated and is validly
existing and in good standing under the laws of the State of Delaware.
The Borrower is duly qualified to transact business and is in good
standing in the jurisdictions in which the conduct of its business or
the ownership of its property requires such qualification.
2. The execution, delivery and performance by the Borrower of
the Loan Agreement and the Note are within the Borrower's corporate
powers and have been duly authorized by all necessary corporate action.
The execution, delivery and performance of the Loan Agreement and the
Note by the Borrower will not contravene the Certificate of
Incorporation or by-laws of the Borrower or result in any violation of
any of the terms or provisions of any law or regulation or of any
indenture, mortgage or other agreement or instrument known to me by
which the Borrower is bound or, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Borrower.
3. Each of the Loan Agreement and the Note constitutes a
legal, valid and binding agreement of the Borrower enforceable against
the Borrower in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights
generally against (or affecting) the Borrower and by general equitable
principles (regardless of whether the issue of enforceability is
considered in a proceeding in equity or at law).
22
EXHIBIT C
Page 2
4. There is no action, suit or proceeding pending against, or
to the best of my knowledge threatened against or affecting, the
Borrower before any court or administrator or any governmental body,
agency or official, in which there is a reasonable possibility of an
adverse decision which could materially adversely affect the financial
position of the Borrower or which in any manner draws into question the
validity of the Loan Agreement or the Note.
I am a member of the Bar of the State of New York and the foregoing
opinion is limited to the laws of the State of New York and the federal laws of
the United States of America.
I understand that copies of this opinion are being delivered to
Standard & Poor's Corporation in connection with the issuance of the Bonds. Such
entities are authorized to rely upon this opinion as though this opinion were
addressed to them.
Very truly yours,
23
EXHIBIT D
[FORM OF GE CAPITAL'S OPINION OF COUNSEL]
_____________, 20__
FGIC Securities Purchase, Inc.
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Xxxxx'x Investors Service
00 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
I am Associate General Counsel, Treasury Operations for General Electric Capital
Corporation ("GE Capital") and in such capacity I have acted for GE Capital in
connection with the Standby Loan Agreement (the "Loan Agreement") dated as of
_________, ____, between GE Capital and FGIC Securities Purchase, Inc. Terms
defined in the Loan Agreement are used herein as therein defined. This opinion
is being rendered to you pursuant to Section 7.1(d) of the Loan Agreement.
I have examined such documents, certificates, orders and proceedings and have
made such investigation as I have deemed necessary or appropriate for purposes
of this opinion.
Upon the basis of the foregoing, I am of the opinion that:
1. GE Capital has been duly incorporated and is validly existing
and in good standing under the laws of the State of New York.
GE Capital is duly qualified to transact business and is in
good standing in the jurisdictions in which the conduct of its
business or the ownership of its property requires such
qualification.
2. The execution, delivery and performance by GE Capital of the
Loan Agreement are within GE Capital's corporate powers and
have been duly authorized by all necessary corporate action on
the part of GE Capital. The execution, delivery and
performance of the Loan Agreement by GE Capital will not
contravene the Organization Certificate or by-laws of GE
Capital or result in any violation of any of the terms or
provisions of any law or regulation or of any indenture,
mortgage or other agreement or instrument known to me by which
GE Capital is bound or,
24
EXHIBIT D
Page 2
any judgment, order or decree of any governmental body, agency
or court having jurisdiction over GE Capital.
3. The Loan Agreement constitutes a legal, valid and binding
agreement of GE Capital enforceable against GE Capital in
accordance with its terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors'
rights as they would apply to the bankruptcy, insolvency or
reorganization of GE Capital and by general equitable
principles (regardless of whether the issue of enforceability
is considered in a proceeding in equity or at law).
My opinion is limited to the law of the State of New York and the federal laws
of the United States of America.
Very truly yours,
