EXHIBIT 10.4
EXECUTION COPY
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SENIOR LOAN AGREEMENT
dated as of
June 28, 2006
among
CENTERBROOK FINANCIAL LLC
The Lenders Party Hereto
and
CITIBANK, N.A.,
as Senior Agent
---------------------------
IXIS FINANCIAL PRODUCTS INC.,
as Sole Lead Arranger
CITIBANK, N.A.,
as Sole Bookrunner
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TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS............................................................................................1
SECTION 1.01. DEFINED TERMS......................................................................1
SECTION 1.02. CLASSIFICATION OF LOANS AND BORROWINGS.............................................8
SECTION 1.03. TERMS GENERALLY....................................................................8
SECTION 1.04. ACCOUNTING TERMS; GAAP.............................................................8
ARTICLE II THE CREDITS...........................................................................................8
SECTION 2.01. COMMITMENTS........................................................................8
SECTION 2.02. LOANS AND BORROWINGS...............................................................8
SECTION 2.03. REQUESTS FOR BORROWINGS............................................................9
SECTION 2.04. FUNDING OF BORROWINGS..............................................................9
SECTION 2.05. INTEREST RATE ELECTIONS............................................................9
SECTION 2.06. TERMINATION AND REDUCTION OF COMMITMENTS..........................................10
SECTION 2.07. REPAYMENT OF LOANS; EVIDENCE OF DEBT..............................................11
SECTION 2.08. PREPAYMENT OF LOANS...............................................................11
SECTION 2.09. FEES..............................................................................11
SECTION 2.10. INTEREST..........................................................................12
SECTION 2.11. ALTERNATE RATE OF INTEREST........................................................12
SECTION 2.12. INCREASED COSTS...................................................................12
SECTION 2.13. BREAK FUNDING PAYMENTS............................................................13
SECTION 2.14. TAXES.............................................................................13
SECTION 2.15. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS.......................14
SECTION 2.16. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS....................................15
SECTION 2.17. LENDER RATING CRITERIA............................................................15
ARTICLE III REPRESENTATIONS AND WARRANTIES......................................................................16
SECTION 3.01. ORGANIZATION; POWERS..............................................................16
SECTION 3.02. AUTHORIZATION; ENFORCEABILITY.....................................................16
SECTION 3.03. GOVERNMENTAL APPROVALS; NO CONFLICTS..............................................16
SECTION 3.04. PROPERTIES........................................................................17
SECTION 3.05. LITIGATION........................................................................17
SECTION 3.06. COMPLIANCE WITH LAWS AND AGREEMENTS...............................................17
SECTION 3.07. INVESTMENT COMPANY STATUS.........................................................17
SECTION 3.08. TAXES.............................................................................17
SECTION 3.09. ERISA.............................................................................17
SECTION 3.10. DISCLOSURE........................................................................17
SECTION 3.11. SOLVENCY..........................................................................17
SECTION 3.12. SECURITY DOCUMENTS................................................................17
SECTION 3.13. CAPITALIZATION....................................................................17
ARTICLE IV CONDITIONS...........................................................................................18
SECTION 4.01. EFFECTIVE DATE....................................................................18
SECTION 4.02. EACH CREDIT EVENT.................................................................19
ARTICLE V AFFIRMATIVE COVENANTS.................................................................................19
SECTION 5.01. FINANCIAL STATEMENTS; RATINGS CHANGE AND OTHER INFORMATION........................19
SECTION 5.02. NOTICES OF MATERIAL EVENTS........................................................20
SECTION 5.03. EXISTENCE; CONDUCT OF BUSINESS....................................................20
SECTION 5.04. PAYMENT OF OBLIGATIONS............................................................21
SECTION 5.05. MAINTENANCE OF PROPERTIES; INSURANCE..............................................21
SECTION 5.06. BOOKS AND RECORDS; INSPECTION RIGHTS..............................................21
SECTION 5.07. COMPLIANCE WITH LAWS; CONTRACTUAL OBLIGATIONS.....................................21
SECTION 5.08. CERTAIN ADDITIONAL ACTIVITIES.....................................................21
SECTION 5.09. FURTHER ASSURANCES................................................................21
SECTION 5.10. USE OF PROCEEDS...................................................................21
(i)
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ARTICLE VI NEGATIVE COVENANTS...................................................................................22
SECTION 6.01. INDEBTEDNESS......................................................................22
SECTION 6.02. LIENS.............................................................................22
SECTION 6.03. FUNDAMENTAL CHANGES...............................................................22
SECTION 6.04. INVESTMENTS.......................................................................23
SECTION 6.05. CAPITAL EXPENDITURE...............................................................23
SECTION 6.06. RESTRICTED PAYMENTS...............................................................23
SECTION 6.07. TRANSACTIONS WITH AFFILIATES......................................................23
SECTION 6.08. CERTAIN INDEBTEDNESS..............................................................23
SECTION 6.09. CAPITAL MODEL.....................................................................23
SECTION 6.10. FORMS.............................................................................23
SECTION 6.11. BUSINESS ACTIVITIES...............................................................23
SECTION 6.12. BANKRUPTCY........................................................................23
ARTICLE VII EVENTS OF DEFAULT...................................................................................23
ARTICLE VIII THE SENIOR AGENT...................................................................................25
ARTICLE IX MISCELLANEOUS........................................................................................27
SECTION 9.01. NOTICES...........................................................................27
SECTION 9.02. WAIVERS; AMENDMENTS...............................................................27
SECTION 9.03. EXPENSES; INDEMNITY; DAMAGE WAIVER................................................28
SECTION 9.04. SUCCESSORS AND ASSIGNS............................................................28
SECTION 9.05. SURVIVAL..........................................................................30
SECTION 9.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS..........................................30
SECTION 9.07. SEVERABILITY......................................................................30
SECTION 9.08. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS........................31
SECTION 9.09. WAIVER OF JURY TRIAL..............................................................31
SECTION 9.10. HEADINGS..........................................................................31
SECTION 9.11. CONFIDENTIALITY...................................................................31
SECTION 9.12. USA PATRIOT ACT...................................................................31
SECTION 9.13. NO PETITION; LIMITED RECOURSE.....................................................32
SCHEDULES
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Schedule 2.01 -- Commitments
EXHIBITS:
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Exhibit A -- Form of Assignment and Assumption
Exhibit B -- Form of Opinion of Borrower's Counsel
Exhibit C -- Form of CDS Security Agreement
(ii)
SENIOR LOAN AGREEMENT dated as of June 28, 2006 among Centerbrook
Financial LLC, the LENDERS party hereto, and Citibank, N.A., as Senior Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. DEFINED TERMS. As used in this Agreement, the following
terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Base Rate.
"ADMINISTRATIVE QUESTIONNAIRE" means an Administrative Questionnaire
in a form supplied by the Senior Agent.
"AFFILIATE" means, 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 and, if such
other Person is an individual, any member of the immediate family (including
parents, spouse, children and siblings) of such individual and any trust whose
principal beneficiary is such individual or one or more members of such
immediate family and any Person who is controlled by any such member or trust,
PROVIDED that, in any event, any Person that owns directly or indirectly
securities having 5% or more of the voting power for the election of directors
or other governing body of a corporation or 5% or more of the partnership or
other ownership interests of any other Person (other than as a limited partner
of such other Person) will be deemed to "Control" such corporation or other
Person for purposes of this definition.
"APPLICABLE PERCENTAGE" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments.
"APPROVED FUND" means any Person (other than a natural person) that is
engaged in making, purchasing, holding or investing in bank loans and similar
extensions of credit in the ordinary course of its business and that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an
entity or an Affiliate of an entity that administers or manages a Lender.
"ASSIGNMENT AND ASSUMPTION" means an assignment and assumption entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Senior Agent, in the form of
Exhibit A or any other form approved by the Senior Agent.
"AVAILABILITY PERIOD" means the period from and including the
Effective Date to but excluding the earlier of the Maturity Date and the date of
termination of the Commitments.
"AVAILABLE MEZZANINE LOAN AMOUNTS" has the meaning ascribed thereto in
the Mezzanine Facility.
"BANKRUPTCY EVENT" has the meaning assigned to such term in the
Operating Agreement.
"BASE RATE" means, for any day, a rate per annum equal to the higher
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%. Any change in the Base Rate due to a
change in the Prime Rate or the Federal Funds Effective Rate shall be effective
from and including the effective date of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.
"BOARD" means the Board of Governors of the Federal Reserve System of
the United States of America.
"BORROWER" means Centerbrook Financial LLC, a Delaware limited
liability company.
"BORROWING" means Loans of the same Type, made, converted or continued
on the same date and, in the case of Eurodollar Loans, as to which a single
Interest Period is in effect.
"BORROWING REQUEST" means a request by the Borrower for a Borrowing in
accordance with Section 2.03.
"BUSINESS DAY" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by law
to remain closed; PROVIDED 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 means 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.
"CAPITAL MODEL" has the meaning assigned to such term in the Operating
Agreement.
"CDS" has the meaning assigned to such term in the Operating
Agreement.
"CDS HOLDERS" has the meaning assigned to such term in Section
6.02(c).
"CDS SECURITY AGREEMENT" means the Security Agreement dated as of the
date hereof between the Borrower and the collateral agent party thereto and in
substantially the form of Exhibit C.
"CHANGE IN CONTROL" means at any time (i) Holdings does not directly
own 100% of the Voting Interests of the Borrower, (ii) prior to a Qualified IPO,
CharterMac and its Controlled affiliates do not collectively own, directly or
indirectly, at least 51% of each class of Voting Interests of Holdings, or (iii)
after a Qualified IPO, CharterMac and its Controlled affiliates does not
collectively own, directly or indirectly, at least 25% of each class of Voting
Interests of Holdings.
"CHANGE IN LAW" means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender (or, for
purposes of Section 2.12(b), by any lending office of such Lender or by such
Lender's holding company, if any) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or
issued after the date of this Agreement.
"CHARTERMAC" means CharterMac, a Delaware statutory trust.
"CODE" means the Internal Revenue Code of 1986.
"COLLATERAL" has the meaning assigned to such term in the
Subordination and Security Agreement.
"COLLATERAL AGENT" means Deutsche Bank Trust Company Americas or any
successor or substitute Collateral Agent appointed pursuant to the terms of the
Subordination and Security Agreement.
"COLLATERAL SUPPORT SWAP" has the meaning assigned to such term in the
Operating Agreement.
"COLLECTION PERIOD" has the meaning assigned to such term in the
Operating Agreement.
"COMMITMENT" means, with respect to each Lender, the commitment of
such Lender to make Loans hereunder, as such commitment may be (a) reduced from
time to time pursuant to Section 2.06, (b) reduced or increased from time to
time pursuant to assignments by or to such Lender pursuant to Section 9.04 or
(c) reduced pursuant to Article VII. The initial amount of each Lender's
Commitment is set forth on Schedule 2.01 or in the Assignment and Assumption
pursuant to which such Lender shall have assumed its Commitment, as applicable.
The initial aggregate amount of the Lenders' Commitments is $30,000,000.
"CONTROL" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
"CONTROLLING" and "CONTROLLED" have meanings correlative thereto.
"CREDIT DOCUMENTS" means, collectively, this Agreement and the
Security Documents.
"CUSTODY AGREEMENT" has the meaning assigned to such term in the
Operating Agreement.
"DEFAULT" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"DISTRIBUTION SCHEDULE" has the meaning assigned to such term in the
Operating Agreement.
"DOLLARS" or "$" refers to lawful money of the United States of
America.
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"DOWNGRADED BANK ACCOUNT" has the meaning set forth in Section
2.17(a).
"DOWNGRADED BANK ACCOUNT RELEASE DATE" has the meaning set forth in
Section 2.17(c).
"EFFECTIVE DATE" means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).
"ENVIRONMENTAL LAWS" means all 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.
"ENVIRONMENTAL LIABILITY" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower directly or indirectly resulting from
or based upon (a) violation of any Environmental Law, (b) the generation, use,
handling, transportation, storage, treatment or disposal of any Hazardous
Materials, (c) exposure to any Hazardous Materials, (d) the release or
threatened release of any Hazardous Materials into the environment or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.
"EQUITY INTERESTS" means shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person, and any
warrants, options or other rights entitling the holder thereof to purchase or
acquire any such equity interest.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that, together with the 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" means (a) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) 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; (c) 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; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from 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.
"EURODOLLAR", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the LIBO Rate.
"EVENT OF DEFAULT" has the meaning assigned to such term in Article
VII.
"EXCLUDED TAXES" means, with respect to the Senior Agent, any Lender
or any other recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder, (a) income or franchise taxes imposed on
(or measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed by
the United States of America or any similar tax imposed by any other
jurisdiction in which the Borrower is located and (c) in the case of a Foreign
Lender (other than an assignee pursuant to a request by the Borrower under
Section 2.16(b)), any withholding tax that is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party to this Agreement
(or designates a new lending office) or is attributable to such Foreign Lender's
failure to comply with Section 2.14(e), except to the extent that such Foreign
Lender (or its assignor, if any) was entitled, at the time of designation of a
new lending office (or assignment), to receive additional amounts from the
Borrower with respect to such withholding tax pursuant to Section 2.14(a).
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) 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 (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
3
transactions received by the Senior Agent from three Federal funds brokers of
recognized standing selected by it.
"FINANCIAL OFFICER" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"FOREIGN LENDER" means any Lender that is organized under the laws of
a jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"GAAP" means generally accepted accounting principles in the United
States of America.
"GOVERNMENTAL AUTHORITY" means the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"GUARANTEE" of or by any Person (the "GUARANTOR") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "PRIMARY OBLIGOR") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (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 or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; PROVIDED that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.
"HAZARDOUS MATERIALS" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"HEDGING AGREEMENT" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
"HOLDINGS" means Centerbrook Holdings LLC.
"INDEBTEDNESS" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (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 acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable 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 Indebtedness
secured thereby has been assumed, (g) all Guarantees by such Person of
Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"INDEPENDENT MANAGER" has the meaning assigned to such term in the
Operating Agreement.
"INDEMNIFIED TAXES" means Taxes other than Excluded Taxes.
"INFORMATION MEMORANDUM" means the Confidential Information Memorandum
distributed on behalf of the Borrower in January, 2006 relating to the Borrower
and the Transactions.
"INITIAL CAPITAL CONTRIBUTION" has the meaning assigned to such term
in the Operating Agreement.
"INTEREST ELECTION REQUEST" means a request by the Borrower to convert
a Borrowing in accordance with Section 2.05.
4
"INTEREST PERIOD" means, with respect to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing and ending on the next Quarterly
Payment Date and thereafter, the period commencing on the last day of the
preceding Interest Period and ending on the next Quarterly Payment Date. For
purposes hereof, the date of a Borrowing initially shall be the date on which
such Borrowing is made and thereafter shall be the effective date of the most
recent conversion or continuation of such Borrowing.
"INVESTMENT" means, for any Person (a) the acquisition (whether for
cash, property, services or securities or otherwise) of capital stock, bonds,
notes, debentures, partnership or other ownership interests or other securities
of any other Person or any agreement to make any such acquisition (including any
"short sale" or any sale of any securities at a time when such securities are
not owned by the Person entering into such sale), (b) the making of any deposit
with, or advance, loan or other extension of credit to, any other Person
(including the purchase of property from another Person subject to an
understanding or agreement, contingent or otherwise, to resell such property to
such Person), (c) the entering into of any Guarantee of, or other contingent
obligation with respect to, Indebtedness or other liability of any other Person
and (without duplication) any amount committed to be advanced, lent or extended
to such Person, or (d) the entering into of any Hedging Agreement.
"LENDER RATING CRITERIA" means criteria satisfied on any date with
respect to any Lender if (a) either (i) the unsecured, unguaranteed and
otherwise unsupported short-term debt obligations of such Lender are rated at
least "A-1+" by S&P or (ii) if there is no such S&P short-term debt obligations
rating, the unsecured, unguaranteed and otherwise unsupported long-term senior
debt obligations of such Lender are rated at least "AA-" by S&P, and (b) either
(i)(x) the unsecured, unguaranteed and otherwise unsupported short-term debt
obligations of such Lender are rated "P-1" by Moody's and such rating is not on
watch for possible downgrade by Moody's and (y) the unsecured, unguaranteed and
otherwise unsupported long-term senior debt obligations of such Lender are rated
higher than "A1" by Moody's or are rated "A1" by Moody's and such rating is not
on watch for possible downgrade by Moody's or (ii) if there is no such Moody's
short-term debt obligations rating, the unsecured, unguaranteed and otherwise
unsupported long-term senior debt obligations of such Lender are rated higher
than "Aa3" by Moody's or are rated "Aa3" by Moody's and such rating is not on
watch for possible downgrade by Moody's.
"LENDERS" means the Persons listed on Schedule 2.01 and any other
Person that shall have become a party hereto pursuant to an Assignment and
Assumption, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Assumption.
"LIBO RATE" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on
any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the Senior
Agent from time to time for purposes of providing quotations of interest rates
applicable to dollar deposits in the London interbank market) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, as the rate for dollar deposits with a maturity comparable to
such Interest Period. In the event that such rate is not available at such time
for any reason, then the "LIBO RATE" with respect to such Eurodollar Borrowing
for such Interest Period shall be the rate at which dollar deposits of
$5,000,000 and for a maturity comparable to such Interest Period are offered by
the principal London office of the Senior Agent in immediately available funds
in the London interbank market at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest Period.
"LIEN" has the meaning assigned to such term in the Operating
Agreement.
"LOANS" means the loans made, continued or converted by the Lenders to
the Borrower pursuant to this Agreement.
"MANAGING MEMBER" has the meaning assigned to such term in the
Operating Agreement.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, operations, property, condition (financial or otherwise) or prospects
of the Borrower or the Managing Member, (b) the ability of the Borrower to
perform its obligations under this Agreement or any other Program Document, (c)
the validity or enforceability of any of the Program Documents or (d) the rights
or remedies of the Senior Agent or the Lenders under this Agreement or any other
Program Document.
"MATERIAL INDEBTEDNESS" means Indebtedness (other than the Loans and
in respect of CDS) of the Borrower in an aggregate principal amount exceeding
$1,000,000.
"MATURITY DATE" means June 28, 2036, unless such date is not a
Business Day, in which case the "Maturity Date" shall be the immediately
preceding Business Day.
"MEZZANINE FACILITY" has the meaning assigned to such term in the
Operating Agreement.
"MINIMUM CAPITAL REQUIREMENT" has the meaning assigned to such term in
the Operating Agreement.
5
"MOODY'S" means Xxxxx'x Investors Service, Inc.
"MULTIEMPLOYER PLAN" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"MULTIFAMILY REVENUE BONDS" has the meaning assigned to such term in
the Operating Agreement.
"OFF-SETTING SWAP" has the meaning assigned to such term in the
Operating Agreement.
"OPERATING AGREEMENT" means the Limited Liability Company Agreement of
the Borrower dated as of June 28, 2006.
"OTHER TAXES" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement.
"PARTICIPANT" has the meaning set forth in Section 9.04.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"PERMITTED INVESTMENTS" has the meaning assigned to such term in the
Operating Agreement.
"PERMITTED LIENS" has the meaning assigned to such term in the
Operating Agreement.
"PERSON" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"PLAN" means 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 or Section 302 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.
"PRIME RATE" means the rate of interest per annum publicly announced
from time to time by Citibank, N.A. as its prime rate (which need not be its
best rate) in effect at its principal office in New York City; each change in
the Prime Rate shall be effective from and including the date such change is
publicly announced as being effective.
"PROGRAM DOCUMENT" has the meaning assigned to such term in the
Operating Agreement.
"PROJECT INVESTMENTS" has the meaning assigned to such term in the
Operating Agreement.
"QUALIFIED IPO" means a bona fide underwritten sale to the public of
common stock of Holdings pursuant to a registration statement (other than on
Form S-8 or any other form relating to securities issuable under any benefit
plan of Holdings) that is declared effective by the Securities Exchange
Commission and which results in minimum aggregate gross cash proceeds in excess
of $500,000,000.
"QUARTERLY PAYMENT DATE" has the meaning assigned to such term in the
Operating Agreement.
"RATING AGENCIES" means, collectively, Moody's and S&P.
"RATING CONDITION" means, with respect to each Rating Agency and any
action taken or to be taken under this Agreement, a condition that is satisfied
when each Rating Agency has confirmed to the Company in writing that no
withdrawal, reduction, suspension or other adverse action with respect to any
then current rating by such Rating Agency (including any private or confidential
rating) with respect to this Agreement will occur as a result of such action.
"REGISTER" has the meaning set forth in Section 9.04.
"RELATED PARTIES" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"REQUIRED LENDERS" means, at any time, Lenders having more than 50% of
the sum of (a) the aggregate outstanding principal amount of the Loans at such
time PLUS (b) the aggregate unused amount of the Commitments at such time.
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"RESERVE ACCOUNT" has the meaning assigned to such term in the
Operating Agreement.
"RESTRICTED PAYMENT" means any dividend or other distribution (whether
in cash, securities or other property) with respect to any Equity Interests in
the Borrower, or any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit, on account of the purchase,
redemption, retirement, acquisition, cancellation or termination of any such
Equity Interests in the Borrower or any option, warrant or other right to
acquire any such Equity Interests in the Borrower.
"RIGHT OF FIRST REFUSAL LETTER" has the meaning assigned to such term
in the Operating Agreement.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies Inc.
"SECURITY DOCUMENTS" means, collectively, the Subordination and
Security Agreement, all Uniform Commercial Code financing statements required by
the Subordination and Security Agreement to be filed with respect to the
security interests in personal property and fixtures created pursuant to the
Subordination and Security Agreement, any "control" agreements in connection
therewith and any mortgage, deed of trust or deed to secure debt entered into
pursuant to Section 5.09(b).
"SENIOR AGENT" means Citibank, N.A., in its capacity as administrative
agent for the Lenders hereunder.
"SENIOR STEP UP DATE" means the date occurring on the sixth
anniversary of the date of this Agreement.
"SENIOR STEP UP RATE" means, for purposes of determining commitment
fees pursuant to Section 2.09(a) and interest pursuant to Section 2.10(a) and
Section 2.10(b) from and after the Senior Step Up Date, 0.25%.
"SOLVENT" means, with respect to any Person on a particular date, that
on such date (a) the fair value of the property of such Person is greater than
the total amount of liabilities, including contingent liabilities, of such
Person, (b) the present fair salable value of the assets of such Person is not
less than the amount that will be required to pay the probable liability of such
Person on its debts as they become absolute and matured, (c) such Person does
not intend to, and does not believe that it will, incur debts or liabilities
beyond such Person's ability to pay such debts and liabilities as they mature
and (d) such Person is not engaged in business or a transaction, and is not
about to engage in business or a transaction, for which such Person's property
would constitute an unreasonably small capital. The amount of contingent
liabilities at any time shall be computed as the amount that, in the light of
all the facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured liability.
"SUBORDINATED DEBT FACILITY" has the meaning assigned to such term in
the Operating Agreement.
"SUBORDINATION AND SECURITY AGREEMENT" means the Subordination and
Security Agreement dated as of June 28, 2006 among the Borrower, the Collateral
Agent, the Senior Agent and the and "Mezzanine Agent" under the Mezzanine
Facility.
"SUBSIDIARY" means, with respect to any Person (the "PARENT") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent.
"TAXES" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"TRANSACTIONS" means, collectively, the transactions contemplated by
this Agreement (including the execution, delivery and performance by the
Borrower of this Agreement, the borrowing of Loans, and the use of the proceeds
thereof) and the other Program Documents.
"TYPE", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the LIBO Rate or the Base Rate.
"UCC" means the Uniform Commercial Code as in effect from time to time
in the State of New York.
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"VOTING INTERESTS" of any Person at any time shall mean the Equity
Interests of such Person that are at such time entitled to vote in the election
of the Board of Managers or Managing Member of such Person.
"WIND-DOWN EVENT" has the meaning assigned to such term in the
Operating Agreement.
"WITHDRAWAL LIABILITY" means 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.
SECTION 1.02. CLASSIFICATION OF LOANS AND BORROWINGS. For purposes of
this Agreement, Loans may be classified and referred to by Type (e.g., a
"Eurodollar Loan"). Borrowings also may be classified and referred to by Type
(e.g., a "Eurodollar Borrowing").
SECTION 1.03. TERMS GENERALLY. The definitions of terms herein shall
apply equally to 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". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement, (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights and (f) references to
any law, constitution, statute, treaty, regulation, rule or ordinance, including
any section or other part thereof (each, for purposes of this Section 1.03, a
"law"), shall refer to that law as amended, supplemented or otherwise modified
from time to time and shall include any successor law.
SECTION 1.04. ACCOUNTING TERMS; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; PROVIDED
that, if the Borrower notifies the Senior Agent that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Senior Agent notifies the Borrower that
the Required Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
ARTICLE II
THE CREDITS
SECTION 2.01. COMMITMENTS. Subject to the terms and conditions set
forth herein, each Lender agrees to make Loans to the Borrower from time to time
during the Availability Period in an aggregate principal amount that will not
result in the outstanding principal amount of such Lender's Loans exceeding such
Lender's Commitment. Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrower may borrow, prepay and reborrow Loans.
Each of the Lenders agrees that the CDS Holders (and any collateral agent acting
on their behalf) shall be express third party beneficiaries of the Commitments,
as provided in the CDS Security Agreement, and that such rights of the CDS
Holders (and any such collateral agent) shall survive the occurrence of any
Bankruptcy Event with respect to the Borrower, PROVIDED that notwithstanding the
foregoing the parties hereto shall be permitted to terminate, amend, supplement
or otherwise modify this Agreement without the consent of any CDS Holder (or
such collateral agent), except as otherwise provided in the CDS Security
Agreement.
SECTION 2.02. LOANS AND BORROWINGS.
(a) OBLIGATIONS OF LENDERS. Each Loan shall be made by the Lenders
ratably in accordance with their respective Commitments. The failure of any
Lender to make any Loan required to be made by it shall not relieve any other
Lender of its obligations hereunder; PROVIDED that the Commitments of the
Lenders are several and no Lender shall be responsible for any other Lender's
failure to make Loans as required.
(b) TYPES OF LOANS. Subject to Section 2.11, each Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith. Each Lender at its option may 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 terms of
this Agreement.
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(c) MINIMUM AMOUNTS; LIMITATION ON NUMBER OF BORROWINGS. At the
commencement of each Interest Period for any Eurodollar Borrowing, such
Borrowing shall be in an aggregate amount that is an integral multiple of
$10,000 and not less than $1,000,000. At the time that each ABR Borrowing is
made, such Borrowing shall be in an aggregate amount that is an integral
multiple of $10,000 and not less than $1,000,000; PROVIDED that an ABR Borrowing
may be in an aggregate amount that is equal to the entire unused balance of the
total Commitments. Borrowings of more than one Type may be outstanding at the
same time; PROVIDED that there shall not at any time be more than a total of
five Eurodollar Borrowings outstanding.
(d) LIMITATION ON INTEREST PERIODS. Notwithstanding any other
provision of this Agreement, the Borrower shall not be entitled to request, or
to elect to convert, any Borrowing if the Interest Period requested with respect
thereto would end after the Maturity Date.
SECTION 2.03. REQUESTS FOR BORROWINGS. To request a Borrowing, the
Borrower shall notify the Senior Agent of such request (a) in the case of a
Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three
Business Days before the date of the proposed Borrowing or (b) in the case of an
ABR Borrowing, not later than 10:00 a.m., New York City time, on the date of the
proposed Borrowing. Each such Borrowing Request shall be irrevocable and shall
be in a form approved by the Senior Agent and signed by the Borrower, PROVIDED
that, without prejudice to Section 2.13, the Borrower shall be permitted to
revoke any Borrowing Request related to a Eurodollar Borrowing. Each such
Borrowing Request shall specify the following information in compliance with
Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;
(iv) in the case of a Eurodollar Borrowing, the initial Interest
Period to be applicable thereto, which shall conform to the definition of
the term "Interest Period"; and
(v) the location and number of the Borrower's account to which funds
are to be disbursed, which shall comply with the requirements of Section
2.04.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. Promptly following receipt of a Borrowing
Request in accordance with this Section, the Senior Agent shall advise each
Lender of the details thereof and of the amount of such Lender's Loan to be made
as part of the requested Borrowing.
SECTION 2.04. FUNDING OF BORROWINGS.
(a) FUNDING BY LENDERS. Each Lender shall make each Loan to be made by
it hereunder on the proposed date thereof by wire transfer of immediately
available funds by 12:00 noon, New York City time, to the account of the Senior
Agent most recently designated by it for such purpose by notice to the Lenders.
The Senior Agent will make such Loans available to the Borrower by promptly
crediting the amounts so received, in like funds, to an account of the Borrower
maintained with the Senior Agent in New York City and designated by the Borrower
in the applicable Borrowing Request.
(b) PRESUMPTION BY SENIOR AGENT. Unless the Senior Agent shall have
received notice from a Lender prior to the proposed date of any Borrowing that
such Lender will not make available to the Senior Agent such Lender's share of
such Borrowing, the Senior Agent may assume that such Lender has made such share
available on such date in accordance with paragraph (a) of this Section and may,
in reliance upon such assumption, make available to the Borrower a corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Borrowing available to the Senior Agent, then the applicable Lender
and the Borrower severally agree to pay to the Senior Agent forthwith on demand
such corresponding amount with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the date
of payment to the Senior Agent, at (i) in the case of such Lender, the greater
of the Federal Funds Effective Rate and a rate determined by the Senior Agent in
accordance with banking industry rules on interbank compensation or (ii) in the
case of the Borrower, the interest rate applicable to ABR Loans. If such Lender
pays such amount to the Senior Agent, then such amount shall constitute such
Lender's Loan included in such Borrowing.
SECTION 2.05. INTEREST RATE ELECTIONS.
(a) ELECTIONS BY BORROWER FOR BORROWINGS. Each Borrowing initially
shall be of the Type specified in the applicable Borrowing Request and, in the
case of a Eurodollar Borrowing, shall have an initial Interest Period conforming
to the definition of the term "Interest Period". Thereafter, the Borrower may
elect to convert such Borrowing to a different Type as provided in this Section.
9
The Borrower may elect different options with respect to different portions of
the affected Borrowing, in which case each such portion shall be allocated
ratably among the Lenders holding the Loans comprising such Borrowing, and the
Loans comprising each such portion shall be considered a separate Borrowing.
(b) NOTICE OF ELECTIONS. To make an election pursuant to this Section,
the Borrower shall notify the Senior Agent of such election by the time that a
Borrowing Request would be required under Section 2.03 if the Borrower were
requesting a Borrowing of the Type resulting from such election to be made on
the effective date of such election. Each such Interest Election Request shall
be irrevocable and shall be in a form approved by the Senior Agent and signed by
the Borrower.
(c) CONTENT OF INTEREST ELECTION REQUESTS. Each Interest Election
Request shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies and,
if different options are being elected with respect to different portions
thereof, the portions thereof to be allocated to each resulting Borrowing
(in which case the information to be specified pursuant to clauses (iii)
and (iv) below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest
Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall conform to the definition of the term "Interest
Period".
(d) NOTICE OF INTEREST ELECTION REQUEST. Promptly following receipt of
an Interest Election Request, the Senior Agent shall advise each Lender of the
details thereof and of such Lender's portion of each resulting Borrowing.
(e) AUTOMATIC CONTINUATION AND CONVERSION. Unless a Eurodollar
Borrowing is repaid as provided herein, at the end of the Interest Period
applicable thereto such Borrowing shall be automatically continued as a
Eurodollar Borrowing, unless any of the circumstances described in Section 2.11
exist, in which case such Eurodollar Borrowing shall be converted to an ABR
Borrowing at the end of such Interest Period. Notwithstanding any contrary
provision hereof, if an Event of Default has occurred and is continuing and the
Senior Agent, at the request of the Required Lenders, so notifies the Borrower,
then, so long as an Event of Default is continuing (i) no outstanding Borrowing
may be converted to or continued as a Eurodollar Borrowing and (ii) unless
repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the
end of the Interest Period applicable thereto.
SECTION 2.06. TERMINATION AND REDUCTION OF COMMITMENTS.
(a) SCHEDULED TERMINATION. Unless previously terminated, the
Commitments shall terminate on the Maturity Date.
(b) VOLUNTARY TERMINATION OR REDUCTION. The Borrower may at any time
terminate, or from time to time reduce, the Commitments; PROVIDED that (i) each
reduction of the Commitments shall be in an amount that is an integral multiple
of $10,000 and not less than $1,000,000, (ii) the Borrower shall not terminate
or reduce the Commitments if, after giving effect to any concurrent prepayment
of the Loans in accordance with Section 2.08, the aggregate principal amount of
outstanding Loans would exceed the total Commitments and (iii) the Borrower
shall not reduce or terminate the Commitments if the Minimum Capital Requirement
is not satisfied after giving effect to such reduction or termination as
determined by the Capital Model.
(c) NOTICE OF VOLUNTARY TERMINATION OR REDUCTION. The Borrower shall
notify the Senior Agent of any election to terminate or reduce the Commitments
under paragraph (b) of this Section at least three Business Days prior to the
effective date of such termination or reduction, specifying such election and
the effective date thereof. Promptly following receipt of any notice, the Senior
Agent shall advise the Lenders of the contents thereof. Each notice delivered by
the Borrower pursuant to this Section shall be irrevocable; PROVIDED that a
notice of termination of the Commitments delivered by the Borrower may state
that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Senior Agent on or prior to the specified effective date) if such
condition is not satisfied. Any termination or reduction of the Commitments
shall be permanent. Each reduction of the Commitments shall be made ratably
among the Lenders in accordance with their respective Commitments.
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SECTION 2.07. REPAYMENT OF LOANS; EVIDENCE OF DEBT.
(a) REPAYMENT. The Borrower hereby unconditionally promises to pay to
the Senior Agent for the account of each Lender the then unpaid principal amount
of each Loan on the Maturity Date.
(b) MAINTENANCE OF RECORDS BY LENDERS. 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, including the amounts of principal and interest payable and paid to
such Lender from time to time hereunder.
(c) MAINTENANCE OF RECORDS BY SENIOR AGENT. The Senior Agent shall
maintain accounts in which it shall 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 Senior Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(d) EFFECT OF ENTRIES. The entries made in the accounts maintained
pursuant to paragraph (b) or (c) of this Section shall be PRIMA FACIE evidence
of the existence and amounts of the obligations recorded therein; PROVIDED that
the failure of any Lender or the Senior Agent to maintain such accounts or any
error therein shall not in any manner affect the obligation of the Borrower to
repay the Loans in accordance with the terms of this Agreement.
(e) PROMISSORY NOTES. Any Lender may request that Loans made by it be
evidenced by a promissory note. In such event, the Borrower shall prepare,
execute and deliver to such Lender a promissory note payable to the order of
such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) and in a form approved by the Senior Agent. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 9.04) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its
registered assigns).
SECTION 2.08. PREPAYMENT OF LOANS.
(a) OPTIONAL PREPAYMENTS. Subject to the priority of payments set
forth in Section 13.3 of the Operating Agreement, the Borrower shall have the
right at any time and from time to time to prepay any Borrowing in whole or in
part, subject to prior notice in accordance with paragraph (b) of this Section.
(b) NOTICES, ETC. The Borrower shall notify the Senior Agent of any
prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing,
not later than 11:00 a.m., New York City time, three Business Days before the
date of prepayment or (ii) in the case of prepayment of an ABR Borrowing, not
later than 10:00 a.m., New York City time, on the date of prepayment. Each such
notice shall be irrevocable and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid; PROVIDED
that, if a notice of prepayment is given in connection with a conditional notice
of termination of the Commitments as contemplated by Section 2.06, then such
notice of prepayment may be revoked if such notice of termination is revoked in
accordance with Section 2.06. Promptly following receipt of any such notice
relating to a Borrowing, the Senior Agent shall advise the Lenders of the
contents thereof. Each partial prepayment of any Borrowing shall be in an amount
that would be permitted in the case of an advance of a Borrowing of the same
Type as provided in Section 2.02. Each prepayment of a Borrowing shall be
applied ratably to the Loans included in the prepaid Borrowing. Prepayments
shall be accompanied by accrued interest to the extent required by Section 2.10.
SECTION 2.09. FEES.
(a) COMMITMENT FEE. The Borrower agrees to pay to the Senior Agent for
the account of each Lender a commitment fee, which shall accrue at a rate per
annum equal to 0.40% PLUS the Senior Step Up Rate (if applicable) on the daily
amount of the unused portion of the Commitment of such Lender during the period
from and including the Effective Date to but excluding the date on which such
Commitment terminates. Accrued commitment fees shall be payable in arrears on
each Quarterly Payment Date and on the date on which the Commitments terminate,
commencing on the first such date to occur after the date hereof. All commitment
fees shall be computed on the basis of a year of 360 days and shall be payable
for the actual number of days elapsed (including the first day but excluding the
last day).
(b) SENIOR AGENT'S FEES. The Borrower agrees to pay to the Senior
Agent, for its own account, fees payable in the amounts and at the times
separately agreed upon between the Borrower and the Senior Agent.
(c) PAYMENT OF FEES. All fees payable hereunder shall be paid on the
dates due, in immediately available funds, to the Senior Agent for distribution,
in the case of commitment fees and participation fees, to the Lenders. Fees paid
shall not be refundable under any circumstances.
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SECTION 2.10. INTEREST.
(a) ABR LOANS. The Loans comprising each ABR Borrowing shall bear
interest at the Base Rate PLUS 1.40% PLUS the Senior Step Up Rate (if
applicable).
(b) EURODOLLAR LOANS. The Loans comprising each Eurodollar Borrowing
shall bear interest at the LIBO Rate for the Interest Period in effect for such
Borrowing PLUS 0.40% PLUS the Senior Step Up Rate (if applicable).
(c) DEFAULT INTEREST. Notwithstanding the foregoing, if any principal
of or interest on any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon acceleration or
otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal of
any Loan, 2% PLUS the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section or (ii) in the case of any other amount, 2%
PLUS the rate applicable to ABR Loans as provided in paragraph (a) of this
Section, PROVIDED that, as provided in Section 2.15(g), solely to the extent
that the Borrower has insufficient funds to pay amounts hereunder (other than
with respect to the principal of and interest and commitment fees on the Loans)
in accordance with Sections 13.1(a) and 13.3 of the Operating Agreement, such
unpaid amounts shall not accrue interest.
(d) PAYMENT OF INTEREST. Accrued interest on each Loan shall be
payable in arrears on each Quarterly Payment Date and upon termination of the
Commitments; PROVIDED that (i) interest accrued pursuant to paragraph (c) of
this Section shall be payable on demand and (ii) in the event of any repayment
or prepayment of any Loan, accrued interest on the principal amount repaid or
prepaid shall be payable on the date of such repayment or prepayment.
(e) COMPUTATION. All interest hereunder shall be computed on the basis
of a year of 360 days, except that interest computed by reference to the Base
Rate at times when the Base Rate is based on the Prime Rate shall be computed on
the basis of a year of 365 days (or 366 days in a leap year), and in each case
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day). The applicable Base Rate or LIBO Rate shall be
determined by the Senior Agent, and such determination shall be conclusive
absent manifest error.
SECTION 2.11. ALTERNATE RATE OF INTEREST. If prior to the commencement
of any Interest Period for a Eurodollar Borrowing:
(a) the Senior Agent determines (which determination shall be
conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the LIBO Rate for such Interest Period; or
(b) the Senior Agent is advised by the Required Lenders that the LIBO
Rate for such Interest Period will not adequately and fairly reflect the
cost to such Lenders (or Lender) of making or maintaining their Loans (or
its Loan) included in such Borrowing for such Interest Period;
then the Senior Agent shall give notice thereof to the Borrower and the Lenders
as promptly as practicable thereafter and, until the Senior Agent notifies the
Borrower and the Lenders that the circumstances giving rise to such notice no
longer exist, (i) any Interest Election Request that requests the conversion of
any Borrowing to a Eurodollar Borrowing shall be ineffective and (ii) if any
Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made
as an ABR Borrowing.
SECTION 2.12. INCREASED COSTS.
(a) INCREASED COSTS GENERALLY. If any Change in Law shall:
(i) 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
(ii) impose on any Lender or the London interbank market any other
condition affecting this Agreement or Eurodollar Loans made by such Lender
or participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to reduce the amount of any sum received or
receivable by such Lender hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender, as the case may be, such
additional amount or amounts as will compensate such Lender, as the case may be,
for such additional costs incurred or reduction suffered.
(b) CAPITAL REQUIREMENTS. If any Lender determines that any Change in
Law regarding capital requirements has or would have the effect of reducing the
rate of return on such Lender's capital or on the capital of such Lender's
holding company, if any, as a consequence of this Agreement or the Loans made by
such Lender, to a level below that which such Lender or such Lender's holding
company could have achieved but for such Change in Law (taking into
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consideration such Lender's policies and the policies of such Lender's holding
company with respect to capital adequacy), then from time to time the Borrower
will pay to such Lender, as the case may be, such additional amount or amounts
as will compensate such Lender or such Lender's holding company for any such
reduction suffered.
(c) CERTIFICATES FROM LENDERS. A certificate of a Lender setting forth
the amount or amounts necessary to compensate such Lender or its holding
company, as the case may be, as specified in paragraph (a) or (b) of this
Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.
(d) DELAY IN REQUESTS. Failure or delay on the part of any Lender to
demand compensation pursuant to this Section shall not constitute a waiver of
such Lender's right to demand such compensation; PROVIDED that (i) the Borrower
shall not be required to compensate a Lender pursuant to this Section for any
increased costs or reductions incurred more than 180 days prior to the date that
such Lender notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender's intention to claim
compensation therefor and (ii) if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the 180-day period referred
to in the foregoing clause (ii) shall be extended to include the period of
retroactive effect thereof.
SECTION 2.13. BREAK FUNDING PAYMENTS. In the event of (a) the payment
of any principal of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert or
prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under Sections
2.03 or 2.08(b) and is revoked in accordance therewith), or (d) the assignment
of any Eurodollar Loan other than on the last day of the Interest Period
applicable thereto as a result of a request by the Borrower pursuant to Section
2.16, then, in any such event, the Borrower shall compensate each Lender for the
loss, cost and expense attributable to such event. In the case of a Eurodollar
Loan, such loss, cost or expense to any Lender shall be deemed to include an
amount determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the LIBO Rate that would have been applicable to such
Loan, for the period from the date of such event to the last day of the then
current Interest Period therefor (or, in the case of a failure to borrow or
convert, for the period that would have been the Interest Period for such Loan),
over (ii) the amount of interest which would accrue on such principal amount for
such period at the interest rate which such Lender would bid were it to bid, at
the commencement of such period, for dollar deposits of a comparable amount and
period from other banks in the eurodollar market. A certificate of any Lender
setting forth any amount or amounts that such Lender is entitled to receive
pursuant to this Section shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender the amount
shown as due on any such certificate within 10 days after receipt thereof.
SECTION 2.14. TAXES.
(a) PAYMENTS FREE OF TAXES. Any and all payments by or on account of
any obligation of the Borrower hereunder shall be made free and clear of and
without deduction for any Indemnified Taxes or Other Taxes; PROVIDED that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Senior Agent or Lender (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.
(b) PAYMENT OF OTHER TAXES BY BORROWER. In addition, the Borrower
shall pay any Other Taxes to the relevant Governmental Authority in accordance
with applicable law.
(c) INDEMNIFICATION BY BORROWER. The Borrower shall indemnify the
Senior Agent and each Lender, within 10 days after written demand therefor, for
the full amount of any Indemnified Taxes or Other Taxes paid by the Senior Agent
or such Lender, as the case may be, on or with respect to any payment by or on
account of any obligation of the Borrower hereunder (including Indemnified Taxes
or Other Taxes imposed or asserted on or attributable to amounts payable under
this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender, or by the Senior Agent on its
own behalf or on behalf of a Lender, shall be conclusive absent manifest error.
(d) EVIDENCE OF PAYMENTS. As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
the Borrower shall deliver to the Senior Agent the original or a certified copy
of a receipt issued by such Governmental Authority evidencing such payment, a
copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Senior Agent.
(e) FOREIGN LENDERS. Any Foreign Lender that is entitled to an
exemption from or reduction of withholding tax under the law of the jurisdiction
in which the Borrower is located, or any treaty to which such jurisdiction is a
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party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Senior Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law or reasonably requested by the Borrower as will permit such
payments to be made without withholding or at a reduced rate.
(f) REFUNDS. If the Senior Agent or a Lender determines, in its sole
discretion, that it has received a refund of any Taxes or Other Taxes as to
which it has been indemnified by the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to this Section, it shall pay over
such refund to the Borrower (but only to the extent of indemnity payments made,
or additional amounts paid, by the Borrower under this Section with respect to
the Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket
expenses of the Senior Agent or such Lender and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund); PROVIDED that the Borrower, upon the request of the Senior Agent or
such Lender, agrees to repay the amount paid over to the Borrower (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Senior Agent or such Lender in the event the Senior Agent or
such Lender is required to repay such refund to such Governmental Authority.
This Section shall not be construed to require the Senior Agent or any Lender to
make available its tax returns (or any other information relating to its taxes
which it deems confidential) to the Borrower or any other Person.
SECTION 2.15. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF
SET-OFFS.
(a) PAYMENTS BY BORROWER. The Borrower shall make each payment
required to be made by it hereunder (whether of principal, interest or fees, or
of amounts payable under Section 2.12, 2.13 or 2.14, or otherwise) prior to 2:00
p.m., New York City time, on the date when due, in immediately available funds,
without set-off or counterclaim. Any amounts received after such time on any
date may, in the discretion of the Senior Agent, be deemed to have been received
on the next succeeding Business Day for purposes of calculating interest
thereon. All such payments shall be made to the Senior Agent in the manner as
shall have been notified by the Senior Agent to the other parties hereto, except
that payments pursuant to Sections 2.12, 2.13, 2.14 and 9.03 shall be made
directly to the Persons entitled thereto. The Senior Agent shall distribute any
such payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All payments hereunder shall be made in dollars.
(b) APPLICATION OF INSUFFICIENT PAYMENTS. If at any time insufficient
funds are received by and available to the Senior Agent to pay fully all amounts
of principal, interest and fees then due hereunder, such funds shall be applied
towards payment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties.
(c) PRO RATA TREATMENT. Except to the extent otherwise provided
herein: (i) each Borrowing shall be made from the Lenders, each payment of fees
for account of the Lenders under Section 2.09 shall be made for account of the
Lenders, and each termination or reduction of the amount of the Commitments
under Section 2.06 shall be applied to the respective Commitments of the
Lenders, pro rata according to the amounts of their respective Commitments; (ii)
each Borrowing shall be allocated pro rata among the Lenders according to the
amounts of their respective Commitments (in the case of the making of Loans) or
their respective Loans that are to be included in such Borrowing (in the case of
conversions and continuations of Loans); (iii) each payment or prepayment of
principal of Loans by the Borrower shall be made for account of the Lenders pro
rata in accordance with the respective unpaid principal amounts of the Loans
held by them; and (iv) each payment of interest on Loans by the Borrower shall
be made for account of the Lenders pro rata in accordance with the amounts of
interest on such Loans then due and payable to the respective Lenders.
(d) SHARING OF PAYMENTS BY LENDERS. If any Lender shall, by exercising
any right of set-off or counterclaim or otherwise, obtain payment in respect of
any principal of or interest on any of its Loans resulting in such Lender
receiving payment of a greater proportion of the aggregate amount of its Loans
and accrued interest thereon than the proportion received by any other Lender,
then the Lender receiving such greater proportion shall purchase (for cash at
face value) participations in the Loans of other Lenders to the extent necessary
so that the benefit of all such payments shall be shared by the Lenders ratably
in accordance with the aggregate amount of principal of and accrued interest on
their respective Loans; PROVIDED that (i) if any such participations are
purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by the Borrower pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans to any assignee or
participant, other than to the Borrower or Affiliate thereof (as to which the
provisions of this paragraph shall apply). The Borrower consents to the
foregoing and agrees, to the extent it may effectively do so under applicable
law, that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation, PROVIDED
that any amounts collected by such Lender pursuant to this sentence shall be
subject to and paid in accordance with Sections 13.1 and 13.3 of the Operating
Agreement.
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(e) PRESUMPTIONS OF PAYMENT. Unless the Senior Agent shall have
received notice from the Borrower prior to the date on which any payment is due
to the Senior Agent for the account of the Lenders hereunder that the Borrower
will not make such payment, the Senior Agent may assume that the Borrower has
made such payment on such date in accordance herewith and may, in reliance upon
such assumption, distribute to the Lenders, as the case may be, the amount due.
In such event, if the Borrower has not in fact made such payment, then each of
the Lenders, as the case may be, severally agrees to repay to the Senior Agent
forthwith on demand the amount so distributed to such Lender with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the Senior Agent, at the greater of
the Federal Funds Effective Rate and a rate determined by the Senior Agent in
accordance with banking industry rules on interbank compensation.
(f) CERTAIN DEDUCTIONS BY SENIOR AGENT. If any Lender shall fail to
make any payment required to be made by it pursuant to Section 2.04(b) or
2.15(d), then the Senior Agent may, in its discretion (notwithstanding any
contrary provision hereof), apply any amounts thereafter received by the Senior
Agent for the account of such Lender to satisfy such Lender's obligations under
such Sections until all such unsatisfied obligations are fully paid.
(g) PAYMENTS SUBJECT TO OPERATING AGREEMENT. Notwithstanding anything
herein to the contrary, (i) all payments by the Borrower under this Agreement
shall be subject to and paid in accordance with Sections 13.1 and 13.3 of the
Operating Agreement and (ii) to the extent that the Borrower has insufficient
funds to pay amounts hereunder (other than the principal of and interest and
commitment fees on the Loans, which shall be and remain due and payable
hereunder, with interest thereon, until paid in accordance with this Agreement)
in accordance with Sections 13.1(a) and 13.3 of the Operating Agreement, the
amounts for which funds are so available shall be due and payable hereunder and
the amounts for which funds are not so available shall be deferred (without
accrued interest thereon) and shall not be due and payable hereunder (and the
failure to pay such deferred amounts shall not constitute a Default or a
Wind-Down Event under (and as defined in) the Operating Agreement) until the
next Quarterly Payment Date on which the Borrower has sufficient funds to pay
such deferred amounts in accordance with Section 13.3 of the Operating
Agreement.
SECTION 2.16. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.
(a) DESIGNATION OF DIFFERENT LENDING OFFICE. If any Lender requests
compensation under Section 2.12, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 2.14, then such Lender shall use reasonable
efforts to designate a different lending office for funding or booking its Loans
hereunder or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable pursuant
to Section 2.12 or 2.14, as the case may be, in the future and (ii) would not
subject such Lender to any unreimbursed cost or expense and would not otherwise
be disadvantageous to such Lender. The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any such
designation or assignment.
(b) REPLACEMENT OF LENDERS. If any Lender requests compensation under
Section 2.12, or if the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 2.14, or if any Lender defaults in its obligation to fund Loans
hereunder, or if in connection with any proposed amendment, modification,
supplement or waiver with respect to any provision of this Agreement or any
other Credit Document as contemplated by Section 9.02(b) any Lender fails to
consent to any such proposed action within 10 days that such Lender shall have
been notified of such proposed amendment, modification, supplement or waiver,
then the Borrower may, at its sole expense and effort, upon notice to such
Lender and the Senior Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such obligations (which assignee may be another
Lender, if such other Lender accepts such assignment); PROVIDED that (i) the
Borrower shall have received the prior written consent of the Senior Agent,
which consent shall not unreasonably be withheld, (ii) such Lender shall have
received payment of an amount equal to the outstanding principal of its Loans,
accrued interest thereon, accrued fees and all other amounts payable to it
hereunder, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts)
and (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.12 or payments required to be made pursuant to
Section 2.14, such assignment will result in a reduction in such compensation or
payments. A Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.
SECTION 2.17. LENDER RATING CRITERIA.
(a) If any Lender fails to satisfy the Lender Rating Criteria at any
time during the Availability Period, such Lender shall promptly give notice to
the Borrower, the Senior Agent and the Rating Agencies of such failure and, if
such Lender does not within 10 calendar days of such failure (i) provide cash
collateral to a segregated deposit account (the "DOWNGRADED BANK Account")
designated by the Borrower to secure such Lender's obligation to fund its
Commitment hereunder in an amount equal to the then undrawn amount of such
Lender's unused Commitment or (ii) cause a guaranty to be executed and delivered
in favor of the Senior Agent by an Affiliate of such Lender that satisfies the
Lender Rating Criteria, in form and substance reasonably satisfactory to the
15
Senior Agent, guaranteeing the obligation of such Lender in respect of the
Commitment of such Lender, the Borrower shall be required to use its reasonable
efforts to replace such Lender, with the prior written consent of the Senior
Agent (which consent shall not unreasonably be withheld), with an assignee that
satisfies such Lender Rating Criteria. In the event of any such requirement for
the Borrower to replace a Lender, such Lender shall (i) assign all of its rights
and obligations hereunder to an assignee selected by the Borrower upon payment
to such Lender of an amount equal to the outstanding principal of its Loans (or,
if such Loans are trading below par, at the then-market price therefor), accrued
interest thereon, accrued fees and all other amounts payable to it hereunder and
(ii) execute and deliver an Assignment and Assumption and such other documents
evidencing such assignment as shall be necessary or reasonably requested by the
Borrower or the Senior Agent, PROVIDED that no such assignment shall be to the
Borrower or any of its Affiliates without the prior consent of each Lender.
(b) The Senior Agent shall have full power and authority to withdraw
funds from each applicable Downgraded Bank Account at the time of, and in
connection with, the conversion of a funds contained therein to a Loan and to
deposit funds to each Downgraded Bank Account, all in accordance with the terms
of and for the purposes set forth in this Agreement.
(c) From and after the establishment of a Downgraded Bank Account with
respect to any Lender, and until the date (the "DOWNGRADED BANK ACCOUNT RELEASE
DATE" for such Lender) that is the earliest of:
(i) the assignment by such Lender of all of its rights pursuant to
Section 9.04,
(ii) such Lender satisfying the Lender Rating Criteria, and
(iii) the Maturity Date,
all Loans to be made by such Lender shall be made by the Senior Agent
withdrawing funds from such Downgraded Bank Account, and all payments of
principal with respect to Loans made by such Lender (whether or not originally
funded from such Downgraded Bank Account) shall be made by depositing the
related funds into such Downgraded Bank Account. Upon the Downgraded Bank
Account Release Date for a Lender, all funds then held in such Downgraded Bank
Account (after giving effect to any Loans to be made on such date) shall be
remitted by the Senior Agent to such Lender, and thereafter all payments of
principal with respect to Loans made by such Lender shall be paid directly to
such Lender in accordance with the terms of this Agreement.
(d) The Senior Agent shall from time to time invest and reinvest the
funds on deposit in such Downgraded Bank Account from time to time in Permitted
Investments having a maturity of not more than one day from the date of
acquisition. On each Quarterly Payment Date, the Senior Agent shall remit or
cause to be remitted to the relevant Lender all earnings received with respect
to the relevant Downgraded Bank Account during the related Collection Period.
Notwithstanding anything herein to the contrary, neither the Senior Agent nor
the Borrower shall have any liability for any loss arising from any investment
or reinvestment made by it in accordance with, and pursuant to, the provisions
hereof.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. ORGANIZATION; POWERS. The Borrower is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, has all requisite power and authority to carry on its business as
now conducted and, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required.
SECTION 3.02. AUTHORIZATION; ENFORCEABILITY. The Transactions are
within the Borrower's limited liability company powers and have been duly
authorized by all necessary limited liability company and, if required, member
action. Each of the Program Documents to which the Borrower is a party has been
duly executed and delivered by the Borrower and constitutes a legal, valid and
binding obligation of the Borrower, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors' rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.
SECTION 3.03. GOVERNMENTAL APPROVALS; NO CONFLICTS. The Transactions
(a) do not require any consent or approval of, registration or filing with, or
any other action by, any Governmental Authority, except such as have been
obtained or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the Operating Agreement or other organizational
documents of the Borrower or any order of any Governmental Authority, (c) will
not violate or result in a default under any indenture, agreement or other
instrument binding upon the Borrower or its assets, or give rise to a right
16
thereunder to require any payment to be made by the Borrower, and (d) other than
the Liens permitted by Section 6.02, will not result in the creation or
imposition of any Lien on any asset of the Borrower.
SECTION 3.04. PROPERTIES.
(a) PROPERTY GENERALLY. The Borrower has good title to, or valid
leasehold interests in, all its real and personal property material to its
business, 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 for their intended purposes.
(b) INTELLECTUAL PROPERTY. The Borrower owns, or is licensed to use,
all trademarks, tradenames, copyrights, patents and other intellectual property
material to its business, and the use thereof by the Borrower does not infringe
upon the rights of any other Person, except for any such infringements that,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
SECTION 3.05. LITIGATION. There are no actions, suits or proceedings
by or before any arbitrator or Governmental Authority pending against or, to the
knowledge of the Borrower, threatened against or affecting the Borrower (i) 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 or (ii) that involve any
Program Document or the Transactions. Except with respect to any matters that,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect, the Borrower (i) has not failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) has not become subject
to any Environmental Liability, (iii) has not received notice of any claim with
respect to any Environmental Liability or (iv) does not know of any basis for
any Environmental Liability.
SECTION 3.06. COMPLIANCE WITH LAWS AND AGREEMENTS. The Borrower is in
compliance with all laws, regulations and orders of any Governmental Authority
applicable to it or its property and all indentures, agreements and other
instruments binding upon it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. No Default has occurred and is continuing.
SECTION 3.07. INVESTMENT COMPANY STATUS. The Borrower is not an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940.
SECTION 3.08. TAXES. The Borrower has timely filed or caused to be
filed all Tax returns and reports required to have been filed and has paid or
caused to be paid all Taxes required to have been paid by it, except (a) Taxes
that are being contested in good faith by appropriate proceedings and for which
the Borrower has set aside on its books adequate reserves or (b) to the extent
that the failure to do so could not reasonably be expected to result in a
Material Adverse Effect.
SECTION 3.09. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect.
SECTION 3.10. DISCLOSURE. Neither the Information Memorandum nor any
of the other reports, financial statements, certificates or other information
furnished by or on behalf of the Borrower to the Senior Agent or any Lender in
connection with the negotiation of this Agreement or delivered hereunder (as
modified or supplemented by other information so furnished (including
modifications to the Operating Agreement)) contains any material misstatement of
fact or omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; PROVIDED that, with respect to projected financial information, the
Borrower represents only that such information was prepared in good faith based
upon assumptions believed to be reasonable at the time. Since the date of
formation of the Borrower, there has been no material adverse change in the
business, operations, property, condition (financial or otherwise) or prospects
of the Borrower.
SECTION 3.11. SOLVENCY. The Borrower is Solvent.
SECTION 3.12. SECURITY DOCUMENTS. The Security Documents to which the
Borrower is a party create valid and perfected first priority security interests
in the Collateral securing the payment of the obligations owing to the Senior
Agent and the Lenders under this Agreement and the other Credit Documents,
subject to no equal or prior Lien, except as expressly permitted under Section
6.02.
SECTION 3.13. CAPITALIZATION. The Borrower has heretofore delivered to
the Lenders true and complete copies of the Operating Agreement. The only member
of the Borrower on the date hereof is Holdings. As of the date hereof, (x) there
are no outstanding Equity Interests with respect to the Borrower other than the
Equity Interests of Holdings and (y) there are no outstanding obligations of the
Borrower to repurchase, redeem, or otherwise acquire any membership interests of
17
the Borrower nor are there any outstanding obligations of the Borrower to make
payments to any Person, such as "phantom equity" payments, where the amount
thereof is calculated with reference to the fair market value or equity value of
the Borrower.
SECTION 3.14. SUBSIDIARIES. The Borrower has no Subsidiaries, except
for Subsidiaries permitted by Section 6.03(e).
ARTICLE IV
CONDITIONS
SECTION 4.01. EFFECTIVE DATE. The obligations of the Lenders to make
Loans hereunder shall not become effective until the date on which each of the
following conditions is satisfied (or waived in accordance with Section 9.02):
(a) EXECUTED COUNTERPARTS. The Senior Agent shall have received from
each party hereto either (i) a counterpart of this Agreement signed on
behalf of such party or (ii) written evidence satisfactory to the Senior
Agent (which may include telecopy transmission of a signed signature page
of this Agreement) that such party has signed a counterpart of this
Agreement.
(b) OPINIONS OF BORROWER COUNSEL. The Senior Agent shall have received
(i) a favorable written opinion (addressed to the Senior Agent and the
Lenders and dated the Effective Date) of counsel for the Borrower,
substantially in the form of Exhibit B, and (ii) a favorable written
opinion (addressed to the Senior Agent and the Lenders and dated the
Effective Date) of Proskauer Rose LLP, counsel for the Borrower, stating
that, subject to customary assumptions, the Borrower and its assets would
not be substantively consolidated with the assets of Holdings or CharterMac
in a bankruptcy of Holdings or CharterMac (and the Borrower hereby requests
such counsel to deliver each such opinion).
(c) LIMITED LIABILITY COMPANY DOCUMENTS. The Senior Agent shall have
received such documents and certificates as the Senior Agent or its counsel
may reasonably request relating to the organization, existence and good
standing of the Borrower, the authorization of the Transactions and any
other legal matters relating to the Borrower, this Agreement or the
Transactions, all in form and substance satisfactory to the Senior Agent
and its counsel.
(d) OFFICER'S CERTIFICATE. The Senior Agent shall have received a
certificate, dated the Effective Date and signed by the President, a Vice
President or a Financial Officer of the Borrower, confirming compliance
with the conditions set forth in paragraphs (f) and (g) of this Section.
(e) PAYMENT OF FEES, ETC. The Senior Agent shall have received all
fees and other amounts due and payable on or prior to the Effective Date,
including, to the extent invoiced, reimbursement or payment of all
out-of-pocket expenses required to be reimbursed or paid by the Borrower
hereunder, and including all fees set forth in the fee letter to which the
Senior Agent and the Borrower are parties. In addition, the Senior Agent
shall have received upfront fees for the account of each Lender in an
amount for each Lender equal to 0.0035 MULTIPLIED BY the aggregate amount
of the Commitment of such Lender on the Effective Date.
(f) REPRESENTATIONS AND WARRANTIES. The representations and warranties
of the Borrower set forth in this Agreement and the other Program Documents
shall be true and correct on and as of the Effective Date.
(g) NO DEFAULT, ETC. No Default or Event of Default shall have
occurred and be continuing as of the Effective Date.
(h) INSURANCE. The Senior Agent shall have received satisfactory
evidence that the Borrower has obtained, from financially sound and
reputable insurance companies, insurance in such amounts and against such
risks as are customarily maintained by companies engaged in the same or
similar businesses operating in the same or similar locations.
(i) SUBORDINATION AND SECURITY AGREEMENT. The Senior Agent shall have
received the Subordination and Security Agreement, duly executed and
delivered by the parties thereto. In addition, the Borrower shall have
taken such other actions as the Collateral Agent shall have requested in
order to perfect a first priority security interest in the Collateral
created pursuant to the Subordination and Security Agreement in favor of
the Collateral Agent (including actions necessary for the Collateral Agent
to have control (within the meaning of Section 9-104 of the UCC) of each of
the deposit accounts owned by the Borrower).
(j) OTHER DOCUMENTS. The Senior Agent shall have received each of the
following documents, each of which shall be executed and delivered by the
parties thereof and shall be on terms and conditions satisfactory to the
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Senior Agent: (i) the Operating Agreement, (ii) the Mezzanine Facility,
(iii) the Custody Agreement, (iv) the Collateral Support Swap and (v) such
other documents as the Senior Agent or any Lender may reasonably request.
(k) EQUITY CONTRIBUTIONS; CAPITAL STRUCTURE. The Senior Agent shall
have received satisfactory evidence that Holdings has made the Initial
Capital Contribution on terms and conditions satisfactory to the Senior
Agent. The capital structure of the Borrower (including the Mezzanine
Facility) shall be reasonably satisfactory to the Senior Agent.
(l) GOVERNMENTAL APPROVALS; THIRD PARTY APPROVALS. The Borrower has
demonstrated to the satisfaction of the Senior Agent that all necessary
consent or approval of, registration or filing with, or any other action
by, any Governmental Authority and all necessary consent of approval of any
material third party have been obtained or made and are in full forth and
effect in connection with the Transactions.
(m) LITIGATION OR ADMINISTRATIVE PROCEEDINGS. There exists no
litigation or administrative proceedings or other legal or regulatory
developments that could be reasonably likely to prohibit or to impose
burdensome conditions on the consummation of the Transactions or to result
in a Material Adverse Effect.
(n) MEZZANINE FACILITY. The Borrower shall have delivered to the
Senior Agent a certificate setting forth the "Available Mezzanine Loan
Amount" under the Mezzanine Facility, as determined by the Capital Model.
(o) RATINGS. The obligations of the Borrower under this Agreement
shall be rated "Aaa" by Xxxxx'x and "AAA" by S&P, and the obligations of
the Borrower in respect of the Mezzanine Facility shall be rated at least
"A1" by Xxxxx'x and at least "A+" by S&P.
(p) LIEN SEARCHES. The Borrower shall have delivered to the Senior
Agent certified copies of UCC search reports, dated a date reasonably near
to the Effective Date, listing all effective financing statements, which
name the Borrower as debtor, together with copies of such financing
statements (none of which shall cover any Collateral).
(q) CDS SECURITY AGREEMENT. The Senior Agent shall have received the
CDS Security Agreement, duly executed and delivered by the parties thereto.
The Senior Agent shall notify the Borrower and the Lenders of the Effective
Date, and such notice shall be conclusive and binding. Notwithstanding the
foregoing, the obligations of the Lenders to make Loans hereunder shall not
become effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) at or prior to 3:00 p.m., New York City time, on June
30, 2006 (and, in the event such conditions are not so satisfied or waived, the
Commitments shall terminate at such time).
SECTION 4.02. EACH CREDIT EVENT. The obligation of each Lender to make
a Loan on the occasion of any Borrowing shall not be subject to any condition or
event whatsoever (including whether a Default shall have occurred and be
continuing or whether the Loans shall have been accelerated pursuant to Article
VII), except for the requirement that (i) the Borrower shall have complied with
Sections 2.03, (ii) after giving effect to such Loan, the aggregate outstanding
principal amount of the Loans of such Lender do not exceed the aggregate amount
of the Commitments of such Lender and (iii) the Available Mezzanine Loan Amount"
under the Mezzanine Facility shall have been fully utilized by the Borrower (it
being understood that Available Mezzanine Loan Amounts shall be deemed to be
utilized if a Lender has been requested to make an advance under the Mezzanine
Facility and irrespective of whether a Lender under the Mezzanine Facility shall
have complied with its obligation thereunder to fund its loan).
ARTICLE V
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full, the Borrower covenants and agrees with the Lenders that:
SECTION 5.01. FINANCIAL STATEMENTS; RATINGS CHANGE AND OTHER
INFORMATION. The Borrower will furnish to the Senior Agent and each Lender:
(a) within 90 days after the end of each fiscal year of the Borrower,
its audited balance sheet and related statements of operations, members'
equity and cash flows as of the end of and for such year, setting forth in
each case (other than in the case of financial statements for the fiscal
year ending December 31, 2006) in comparative form the figures for the
previous fiscal year, all reported on by Deloitte & Touche LLP or other
independent public accountants of recognized national standing (without a
"going concern" or like qualification or exception and without any
qualification or exception as to the scope of such audit) to the effect
that such financial statements present fairly in all material respects the
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financial condition and results of operations of the Borrower in accordance
with GAAP consistently applied;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, its balance sheet and related
statements of operations, members' equity and cash flows as of the end of
and for such fiscal quarter and the then elapsed portion of the fiscal
year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet,
as of the end of) the previous fiscal year, all certified by one of its
Financial Officers as presenting fairly in all material respects the
financial condition and results of operations of the Borrower in accordance
with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes;
(c) concurrently with any delivery of financial statements under
clause (a) or (b) above, a certificate of a Financial Officer of the
Borrower (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action taken
or proposed to be taken with respect thereto and (ii) stating whether any
change in GAAP or in the application thereof has occurred since the date of
the audited financial statements previously delivered under this Section
and, if any such change has occurred, specifying the effect of such change
on the financial statements accompanying such certificate;
(d) promptly after receipt of any notice or communication from any
Rating Agency with respect to a change in the rating established for the
Loans or any other matter with respect to this Agreement, a copy of each
such notice or communication;
(e) not later than 11:00 a.m. (New York City time) the fifth Business
Day immediately preceding each Quarterly Payment Date, a copy of the
Distribution Schedule with respect to such Quarterly Payment Date;
(f) concurrently with any delivery of any other notice or report
pursuant to any Program Document, a copy of each such notice or report; and
(g) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower, or compliance with the terms of this Agreement, as the Senior
Agent or any Lender may reasonably request.
SECTION 5.02. NOTICES OF MATERIAL EVENTS. The Borrower will furnish to
the Senior Agent and each Lender prompt written notice of the following:
(a) the occurrence of any Default or any development that results in,
or could reasonably be expected to result in, a Material Adverse Effect;
(b) the filing or commencement of any action, suit or proceeding by or
before any arbitrator or Governmental Authority against or affecting the
Borrower or any Affiliate thereof that, if adversely determined, could
reasonably be expected to result in a Material Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together with any
other ERISA Events that have occurred, could reasonably be expected to
result in a Material Adverse Effect;
(d) the occurrence of either (i) a downgrade by either Rating Agency
of its rating of the Borrower's obligations under the Mezzanine Facility or
(ii) a withdrawal by either Rating Agency of such rating;
(e) the occurrence of any Capital Model Deficiency Amount (as defined
in the Operating Agreement) after running the Capital Model as prescribed
by the Operating Agreement;
(f) the occurrence of an adjustment in the "Available Mezzanine Loan
Amount" under the Mezzanine Facility, as determined by the Capital Model;
and
(g) the occurrence of any Program Violation (as defined in the
Operating Agreement).
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
SECTION 5.03. EXISTENCE; CONDUCT OF BUSINESS. The Borrower will do or
cause to be done all things necessary to preserve, renew and keep in full force
and effect its legal existence and the rights, licenses, permits, privileges and
franchises material to the conduct of its business.
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SECTION 5.04. PAYMENT OF OBLIGATIONS. The Borrower will pay its
obligations, including Tax liabilities, that, if not paid, could result in a
Material Adverse Effect before the same shall become delinquent or in default,
except where (a) the validity or amount thereof is being contested in good faith
by appropriate proceedings, (b) the Borrower has set aside on its books adequate
reserves with respect thereto in accordance with GAAP and (c) the failure to
make payment pending such contest could not reasonably be expected to result in
a Material Adverse Effect.
SECTION 5.05. MAINTENANCE OF PROPERTIES; INSURANCE. The Borrower will
(a) keep and maintain all property owned by the Borrower material to the conduct
of its business in good working order and condition, ordinary wear and tear
excepted, and (b) maintain, with financially sound and reputable insurance
companies, insurance in such amounts and against such risks as are customarily
maintained by companies engaged in the same or similar businesses operating in
the same or similar locations.
SECTION 5.06. BOOKS AND RECORDS; INSPECTION RIGHTS. The Borrower will
keep proper books of record and account in which full, true and correct entries
are made of all dealings and transactions in relation to its business and
activities. The Borrower will permit any representatives designated by the
Senior Agent or any Lender, upon reasonable prior notice, to visit and inspect
its properties, to examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times and as often as reasonably requested,
PROVIDED that, unless a Default shall have occurred and be continuing, the
Senior Agent and each Lender shall be permitted to visit and inspect the
properties, and to examine and make extracts from the books and records, of the
Borrower on not more than one occasion during any calendar year.
SECTION 5.07. COMPLIANCE WITH LAWS; CONTRACTUAL OBLIGATIONS. The
Borrower will comply with all laws, rules, regulations and orders of any
Governmental Authority applicable to it or its property, and with all of its
contractual obligations (including in respect of CDS), hereunder or otherwise,
except in each case where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 5.08. CERTAIN ADDITIONAL ACTIVITIES.(a) The Borrower will take
all steps required by the Operating Agreement, this Agreement and the other
Program Documents or reasonably required by the Senior Agent to continue
the Borrower's identity as a separate legal entity and to make it apparent
to other Persons that the Borrower is an entity with assets and liabilities
distinct from those of any other Person.
(b) The Borrower will (i) be a limited purpose company whose
activities are restricted to those activities permitted by Section 6.11 and
(ii) comply with the terms and conditions set forth in the Operating
Agreement (including (a) complying with the special-purpose covenants set
forth in Section 2.10 of the Operating Agreement, (b) operating the Capital
Model at the times required therein, (c) entering into CDS and Off-Setting
Swaps, and making Investments contemplated by Section 6.04(vi), only if
permitted by the Capital Model, (d) entering into CDS and Off-Setting Swaps
only if the eligibility criteria relating thereto are satisfied and (e) if
a Wind-Down Event shall have occurred and be continuing, (x) not entering
into any new CDS or Off-Setting Swaps and not making any Project Investment
contemplated by clause (iii) of the definition thereof and (y) making new
Project Investments (other than any Project Investment contemplated by
clause (iii) of the definition thereof) only to limit its risk exposure).
SECTION 5.09. FURTHER ASSURANCES.(a) The Borrower will take such
action from time to time (including filing appropriate Uniform Commercial
Code financing statements and executing and delivering such assignments,
security agreements and other instruments) as shall be necessary or
reasonably requested by the Senior Agent to create, in favor of the
Collateral Agent for the benefit of the Lenders, perfected security
interests and Liens in the Collateral to secure its obligations hereunder;
PROVIDED that any such security interest or Lien shall be subject to the
relevant requirements of the Security Documents.
(b) If the Borrower or any of its Subsidiaries shall acquire any real
property interest after the date hereof having a fair market value of
$250,000 or more, then it will (or, as applicable, will cause the
respective Subsidiary holding such real property interest to) within 60
days of such acquisition execute and deliver in favor of the Collateral
Agent a mortgage, deed of trust or deed to secure debt (as appropriate for
the jurisdiction in which such respective real property is situated) in
form and substance reasonably satisfactory to the Senior Agent and pursuant
to which the Borrower (or such Subsidiary) will create a Lien upon such
real property interest in favor of the Collateral Agent for the benefit of
the Lenders as collateral security for the obligations of the Borrower
hereunder, and the Borrower will deliver such opinions of counsel and title
insurance policies as the Senior Agent shall reasonably request in
connection therewith in form and substance reasonably satisfactory to the
Senior Agent.
SECTION 5.10. USE OF PROCEEDS. The proceeds of any Loan will be used
only for (a) making settlement and periodic payments in respect of CDS, (b)
making Project Investments, (c) payment of Administrative Expenses (as defined
in the Operating Agreement), (d) payment of amounts owing under Off-Setting Swap
contracts and (e) payments in respect of interest and fees owing under this
Agreement. No part of the proceeds of any Loan will be used, whether directly or
indirectly, for any purpose that entails a violation of any of the regulations
of the Board, including Regulations T, U and X.
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ARTICLE VI
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal of
and interest on each Loan and all fees payable hereunder have been paid in full,
the Borrower covenants and agrees with the Lenders that:
SECTION 6.01. INDEBTEDNESS. The Borrower will not create, incur,
assume or permit to exist any Indebtedness, except:
(a) Indebtedness created hereunder and under the other Program
Documents;
(b) Indebtedness created under the Mezzanine Facility;
(c) Indebtedness in respect of CDS, Off-Setting Swaps and the
Collateral Support Swap; and
(d) Indebtedness up to an aggregate outstanding principal amount
of $200,000,000 created under the Subordinated Debt Facility in the form of
Exhibit E to the Operating Agreement with such changes as shall be
permitted by the Required Lenders.
SECTION 6.02. LIENS. The Borrower will not create, incur, assume or
permit to exist any Lien on any property or asset now owned or hereafter
acquired by it, or assign or sell any income or revenues (including accounts
receivable) or rights in respect of any thereof, except:
(a) Liens created pursuant to the Security Documents;
(b) Permitted Liens; and
(c) Liens created pursuant to the CDS Security Agreement for the
benefit of the holders from time to time of the obligations of the Borrower
in respect of CDS (the "CDS HOLDERS") in the right of the Borrower to
require the Lenders to unconditionally make Loans to the Borrower under
this Agreement as provided herein, as such agreement may be from time to
time amended, supplemented or otherwise modified to the extent that the
Rating Condition shall have been satisfied after giving effect to any such
amendment, supplement or other modification.
SECTION 6.03. FUNDAMENTAL CHANGES.
(a) The Borrower will not enter into any transaction of merger or
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution).
(b) The Borrower will not acquire any business or property from,
or capital stock of, or be a party to any acquisition of, any Person except
(i) for purchases of property necessary to or consistent with the conduct
of the activities permitted by Section 6.11, (ii) as permitted by Section
6.04 and (iii) for acquisitions of any underlying properties in connection
with the exercise of remedies by the Borrower with respect to any
Multifamily Revenue Bonds so long as (x) any such underlying property is
owned by the Borrower through a special purpose corporation or limited
liability company established by the Borrower for the sole purpose of
owning any such underlying property and (y) the Borrower complies with the
applicable provisions of Section 5.09.
(c) Except as expressly permitted in Sections 6.04 and 6.06 and
the payments contemplated by Sections 13.1 and 13.3 of the Operating
Agreement, the Borrower will not convey, sell, lease, dispose of or
otherwise transfer, in one transaction or a series of transactions, any
part of its business or property, whether now owned or hereafter acquired,
other than (i) Permitted Investments and (ii) real property and partnership
and limited liability company ownership interests acquired by the Borrower
in respect of Project Investments or CDS, in each case for fair market
value and on an arm's length basis.
(d) The Borrower will not cause or consent to any amendment or
modification of or waiver under, or permit any amendment or modification of
or waiver under, the Operating Agreement, any Credit Document, the Custody
Agreement, the Collateral Support Swap, the Mezzanine Facility, the
Subordinated Debt Facility or any other Program Document or engage in any
business other than a business expressly permitted by Section 6.11.
(e) The Borrower will not create, acquire or otherwise permit to
exist any Subsidiary, except for (i) Subsidiaries created or acquired in
connection with the making of any Project Investment and (ii) Subsidiaries
created pursuant to Section 6.03(b)(iii).
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(f) The Borrower will not reduce the commitments under the
Mezzanine Facility below the "Available Mezzanine Loan Amount" (as defined
in the Mezzanine Facility).
SECTION 6.04. INVESTMENTS. The Borrower will not make any Investment
other than (i) Project Investments, (ii) Permitted Investments, (iii) CDS, (iv)
Off-Setting Swaps so long as the Rating Condition shall have been satisfied
after giving effect to such Off-Setting Swap, (v) Hedging Agreements in the
ordinary course of business and not for speculative purposes so long as the
Rating Condition shall have been satisfied after giving effect to such Hedging
Agreement and the Members shall have been notified thereof and (vi) acquisitions
of Multifamily Revenue Bonds (and/or any custodial receipts evidencing any
Multifamily Revenue Bonds) pursuant to the terms of any CDS and the Custody
Agreement. The Borrower will not 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.
SECTION 6.05. CAPITAL EXPENDITURE. The Borrower will not make any
capital expenditure other than Project Investments.
SECTION 6.06. RESTRICTED PAYMENTS. The Borrower will not declare or
make, or agree to pay or make, directly or indirectly, any Restricted Payment
except as permitted by the priority of payments set forth in Section 13.3 of the
Operating Agreement.
SECTION 6.07. TRANSACTIONS WITH AFFILIATES. The Borrower will not
sell, lease or otherwise transfer any property or assets to, or purchase, lease
or otherwise acquire any property or assets from, or otherwise engage in any
other transactions with, any of its Affiliates, except (a) in the ordinary
course of business at prices and on terms and conditions not less favorable to
the Borrower than could be obtained on an arm's-length basis from unrelated
third parties and (b) any Restricted Payment permitted by Section 6.06.
SECTION 6.08. CERTAIN INDEBTEDNESS. The Borrower will not prepay,
redeem or repurchase any portion of any Indebtedness in respect of, or make any
other payments under, the Mezzanine Facility or the Subordinated Debt Facility,
except in each case as permitted by the priority of payments set forth in
Section 13.3 of the Operating Agreement.
SECTION 6.09. CAPITAL MODEL. The Borrower will not materially amend,
modify, waive or otherwise make any material change to the Capital Model without
first satisfying the Rating Condition.
SECTION 6.10. FORMS. The Borrower will not amend, modify or otherwise
make any material change to any of the forms relating to CDS or Off-Setting
Swaps, in each case as set forth in the exhibits to the Operating Agreement, or
make any material amendment, modification, waiver or other change to the
definitive agreements of any CDS or Off-Setting Swaps, without in each case
first satisfying the Rating Condition.
SECTION 6.11. BUSINESS ACTIVITIES. The Borrower will not engage in any
business activities other than those set forth and permitted under Section 2.4
of the Operating Agreement.
SECTION 6.12. BANKRUPTCY. The Borrower will not, without the approval
of the Independent Manager, (i) voluntarily commence any proceeding or file any
petition seeking liquidation, reorganization or other similar relief under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar law
now or hereafter in effect; (ii) consent to the institution of, or fail to
contest in a timely and appropriate manner, any proceeding or petition seeking
(a) liquidation, reorganization or other similar relief in respect of the
Borrower or its debts, or of a substantial part of its assets, under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar law
now or hereafter in effect or (b) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or for
a substantial part of its assets; (iii) apply for or consent to the appointment
of a receiver, trustee, custodian, sequestrator, conservator or similar official
for the Borrower or for a substantial part of its assets; (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; or (vi)
take any action for the purpose of effecting any of the foregoing.
ARTICLE VII
EVENTS OF DEFAULT
If any of the following events ("EVENTS OF DEFAULT") shall occur:
(a) the Borrower shall fail to pay 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 otherwise;
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(b) the Borrower shall fail to pay any interest on any Loan or
any fee or any other amount (other than an amount referred to in clause (a)
of this Article) payable under this Agreement, when and as the same shall
become due and payable, and such failure shall continue unremedied for a
period of three Business Days;
(c) any representation or warranty made or deemed made by or on
behalf of the Borrower in or in connection with this Agreement or any
amendment or modification hereof or waiver hereunder, or in any report,
certificate, financial statement or other document furnished pursuant to or
in connection with this Agreement or any amendment or modification hereof
or waiver hereunder, shall prove to have been incorrect when made or deemed
made in any material respect and such breach shall not have been remedied,
cured, reversed or waived within 30 days after receipt by the Borrower of
written notice from the Senior Agent or any Lender of the foregoing;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Sections 5.08, 5.09(b) and 5.10 and
Article VI;
(e) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those
specified in clause (a), (b) or (d) of this Article), and such failure
shall continue unremedied for a period of 30 days after notice thereof from
the Senior Agent to the Borrower (which notice will be given at the request
of any Lender);
(f) the Borrower shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material
Indebtedness, when and as the same shall become due and payable;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables
or permits (after the expiration of any applicable cure periods) the holder
or holders of any Material Indebtedness or any trustee or agent on its or
their behalf to cause any Material Indebtedness to become due, or to
require the prepayment, repurchase, redemption or defeasance thereof, prior
to its scheduled maturity; PROVIDED that this clause (g) shall not apply to
secured Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness;
(h) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed seeking (i) liquidation, dissolution,
reorganization or other relief in respect of any of the Borrower or
Holdings or its debts, or of a substantial part of its assets, under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar
law now or hereafter in effect or (ii) the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for any
of the Borrower or Holdings or for a substantial part of its assets, and,
in any such case, 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;
(i) any of the Borrower or Holdings shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation,
dissolution, reorganization or other relief under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect, (ii) consent to the institution of, or fail to contest
in a timely and appropriate manner, any proceeding or petition described in
clause (h) of this Article, (iii) apply for or consent to the appointment
of a receiver, trustee, custodian, sequestrator, conservator or similar
official for the Borrower or Holdings, as the case may be, or for a
substantial part of its assets, (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 or (vi) take any action
for the purpose of effecting any of the foregoing;
(j) any of the Borrower or Holdings shall admit in writing its
inability or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an
aggregate amount in excess of $1,000,000 shall be rendered against the
Borrower 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 attach or levy
upon any assets of the Borrower to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of
the Required Lenders, when taken together with all other ERISA Events that
have occurred, could reasonably be expected to result in a Material Adverse
Effect;
(m) a Change in Control shall occur;
(n) a Wind-Down Event (other than (i) a Wind-Down Event referred
to in clause (d) of Section 12.1 of the Operating Agreement to the extent
such event relates to this Agreement and (ii) a Wind-Down Event referred to
in clause (l) of Section 12.1 of the Operating Agreement) shall occur;
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(o) (i) any provision of the Operating Agreement, any Credit
Document or the Mezzanine Facility ceases for any reason to be legal, valid
or binding on the Borrower, or the Borrower (or any of its affiliates)
shall in writing state that any provision of any such document should cease
for any reason to be legal valid and binding on the Borrower, or (ii) any
provision of the Right of First Refusal Letter ceases for any reason to be
legal, valid or binding on CharterMac, or CharterMac (or any of its
affiliates) shall in writing state that any provision of any such document
should cease for any reason to be legal valid and binding on CharterMac;
(p) the Collateral Agent shall at any time fail to have a valid,
perfected, first priority security interest in any material portion of the
Collateral; or
(q) (i) the Managing Member willfully violates, or takes any
action that it knows breaches, any material provision of any Program
Document, and any such violation or action could reasonably be expected to
result in a Material Adverse Effect, (ii) the Managing Member materially
breaches any provision of any Program Document or any representation made
by the Managing Member shall prove to have been incorrect when made in any
material respect, and within 30 days of its becoming aware of such breach,
or such incorrect representation, the Managing Member fails to cure such
breach or (iii) the Managing Member commits fraud or criminal activity, or
exercises gross negligence that has an adverse effect on the Lenders, in
the performance of its obligations or the Managing Member is indicted for a
criminal offense related to its primary businesses;
then, subject in each case to Section 2.15(g), (1) and in every such event
(other than an event described in clause (h) or (i) of this Article), and at any
time thereafter during the continuance of such event, the Senior Agent may, and
at the request of the Required Lenders shall, by notice to the Borrower, declare
the Loans then outstanding to be due and payable in whole (or in part, in which
case any principal not so declared to be due and payable may thereafter be
declared to be due and payable), and thereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall become due
and payable immediately, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Borrower; (2) in case of any
event described in clause (h) or (i) of this Article, the principal of the Loans
then outstanding, together with accrued interest thereon and all fees and other
obligations accrued hereunder, shall automatically become due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower; and (3)
(i) except as provided in clause (v) below, the Commitments shall
not terminate and the Lenders shall remain obligated to make Loans under
Section 2.01, including the obligation to make Loans thereunder for the
benefit of the CDS Holders, as provided in the CDS Security Agreement (it
being recognized that any such new Loan shall be due and payable if,
pursuant to the foregoing clauses (1) or (2), the other Loans shall have
been declared due and payable), subject to the terms and conditions in this
Agreement;
(ii) the Borrower shall not be permitted to enter into new CDS or
Off-Setting Swaps or make any Project Investment contemplated by clause
(iii) of the definition thereof and the Borrower shall only be permitted to
make new Project Investments (other than any Project Investment
contemplated by clause (iii) of the definition thereof) to limit its risk
exposure;
(iii) the Required Lenders shall have the option to instruct the
Collateral Agent to foreclose on the Collateral and exercise the remedies
available under the Subordination and Security Agreement (and, in
connection therewith, instruct the Collateral Agent to appoint a special
manager to manage the Collateral (including Project Investments));
(iv) the principal amount of the Loans shall be repaid from funds
in the Reserve Account in accordance with the priority of payments set
forth in Section 13.3 of the Operating Agreement;
(v) after the outstanding Loans shall have been repaid in full,
the aggregate amount required to be held in the Reserve Account shall be
increased by an amount equal to the aggregate Commitments of all Lenders,
and the Commitment for each Lender shall be permanently reduced to zero on
a dollar-for-dollar basis as such additional amounts are retained in the
Reserve Account, as determined by the Capital Model and in accordance with
the priority of payments set forth in Section 13.3 of the Operating
Agreement; and
(vi) the Borrower shall not make, directly or indirectly, any
Restricted Payment to Holdings until the Commitment for each Lender shall
have been permanently reduced to zero.
ARTICLE VIII
THE SENIOR AGENT
Each of the Lenders hereby irrevocably appoints and authorizes
the Senior Agent to act as its agent hereunder and under the other Credit
Documents with such powers as are delegated to the Senior Agent by the terms of
this Agreement and the other Credit Documents, together with such actions and
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powers as are reasonably incidental thereto. Without limiting the generality of
the foregoing, by its signature hereto each Lender authorizes the Senior Agent
to execute, deliver and perform the Subordination and Security Agreement and
agrees to be bound by the terms and conditions thereof as if such Lender were a
party thereto. Subject to the provisions of this Article VIII, the Senior Agent
shall take such actions under the Subordination and Security Agreement as shall
be directed by the Required Lenders.
The bank serving as the Senior Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Senior Agent, and such bank and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with the Borrower or other Affiliate thereof as if it were not
the Senior Agent hereunder.
The Senior Agent shall not have any duties or obligations except
those expressly set forth herein and in the other Credit Documents. Without
limiting the generality of the foregoing, (a) the Senior Agent shall not be
subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing, (b) the Senior Agent shall not have any
duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated hereby and by the
other Credit Documents that the Senior Agent is required to exercise in writing
as directed by the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in Section
9.02), and (c) except as expressly set forth herein and in the other Credit
Documents, the Senior Agent shall not have any duty to disclose, and shall not
be liable for the failure to disclose, any information relating to the Borrower
that is communicated to or obtained by the bank serving as Senior Agent or any
of its Affiliates in any capacity. The Senior Agent shall not be liable for any
action taken or not taken by it with the consent or at the request of the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 9.02) or in the absence
of its own gross negligence or wilful misconduct. The Senior Agent shall be
deemed not to have knowledge of any Default unless and until written notice
thereof is given to the Senior Agent by the Borrower or a Lender, and the Senior
Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement or the other Program Documents, (ii) the contents of any certificate,
report or other document delivered hereunder or under the other Program
Documents or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or in the other Program Documents, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, the other
Program Documents or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein or in
the other Program Documents, other than to confirm receipt of items expressly
required to be delivered to the Senior Agent.
The Senior Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Senior Agent also may
rely upon any statement made to it orally or by telephone and believed by it to
be made by the proper Person, and shall not incur any liability for relying
thereon. The Senior Agent may consult with legal counsel (who may be counsel for
the Borrower), independent accountants and other experts selected by it, and
shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.
The Senior Agent may perform any and all its duties and exercise
its rights and powers by or through any one or more sub-agents appointed by the
Senior Agent. The Senior Agent and any such sub-agent may perform any and all
its duties and exercise its rights and powers through their respective Related
Parties. The exculpatory provisions of the preceding paragraphs shall apply to
any such sub-agent and to the Related Parties of the Senior Agent and any such
sub-agent.
Subject to the appointment and acceptance of a successor Senior
Agent as provided in this paragraph, the Senior Agent may resign at any time by
notifying the Lenders and the Borrower. Upon any such resignation, the Required
Lenders shall have the right, in consultation with the Borrower, to appoint a
successor. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring
Senior Agent gives notice of its resignation, then the retiring Senior Agent
may, on behalf of the Lenders, appoint a successor Senior Agent which shall be a
bank with an office in New York, New York, or an Affiliate of any such bank.
Upon the acceptance of its appointment as Senior Agent hereunder by a successor,
such successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Senior Agent hereunder and under the other
Credit Documents, and the retiring Senior Agent shall be discharged from its
duties and obligations hereunder and under the other Credit Documents. The fees
payable by the Borrower to a successor Senior Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Senior Agent's resignation hereunder, the provisions of
this Article and Section 9.03 shall continue in effect for the benefit of such
retiring Senior Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while it was
acting as Senior Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Senior Agent 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 Senior Agent or any other
Lender and based on such documents and information as it shall from time to time
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deem appropriate, continue to make its own decisions in taking or not taking
action under or based upon this Agreement, any related agreement or any document
furnished hereunder or thereunder.
Notwithstanding anything herein to the contrary, the Sole
Bookrunner and Sole Lead Arranger named on the cover page of this Agreement
shall not have any duties or liabilities under this Agreement, except in its
capacity, if any, as a Lenders.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. NOTICES.
(a) NOTICES GENERALLY. All notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by
telecopy, as follows:
(i) if to the Borrower, to it at 000 Xxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention of Xxxxx Xxxxxx (Telecopy No. 212-317-5762);
(ii) if to the Senior Agent, to Citibank, N.A. at Xxx Xxxxx
Xxxxxx, 00xx Xxxxx Xxxx 00, Xxxx Xxxxxx Xxxx, XX 00000, Attention of
Xxxxx XxXxxx (Telecopy No. 718-248-4722), with a copy to Xxxxx X.
Xxxxxx, Deputy General Counsel, Citigroup Commercial Business Group,
Xxx Xxxxx Xxxxxx, 00xx Xxxxx, Xxxx Xxxxxx Xxxx, XX 00000 (Telecopy No.
718-248-6009); and
(iii) if to any other Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire.
(b) ELECTRONIC COMMUNICATIONS. Notices and other communications
to the Lenders hereunder may be delivered or furnished by electronic
communications pursuant to procedures approved by the Senior Agent; PROVIDED
that the foregoing shall not apply to notices pursuant to Article II unless
otherwise agreed by the Senior Agent and the applicable Lender. The Senior Agent
or the Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; PROVIDED that approval of such procedures may be
limited to particular notices or communications.
(c) CHANGE OF ADDRESS, ETC. Any party hereto may change its
address or telecopy number for notices and other communications hereunder by
notice to the other parties 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.
SECTION 9.02. WAIVERS; AMENDMENTS.
(a) NO DEEMED WAIVERS; REMEDIES CUMULATIVE. No failure or delay
by the Senior Agent or any Lender in exercising any right or power hereunder
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 Senior
Agent and the Lenders hereunder 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 consent to any departure by the Borrower therefrom shall in
any event be effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan shall not be construed as a
waiver of any Default, regardless of whether the Senior Agent or any Lender may
have had notice or knowledge of such Default at the time.
(b) AMENDMENTS. Neither this Agreement, any other Credit Document
nor any provision hereof or thereof may be waived, amended or modified except
pursuant to an agreement or agreements in writing entered into by the Borrower
and the Required Lenders or by the Borrower and the Senior Agent with the
consent of the Required Lenders; PROVIDED that no such agreement shall
(i) increase the Commitment of any Lender without the written
consent of such Lender,
(ii) reduce the principal amount of any Loan or reduce the rate
of interest thereon, or reduce any fees payable hereunder, without the
written consent of each Lender adversely affected thereby,
(iii) postpone the scheduled date of payment of the principal
amount of any Loan, or any interest thereon, or any fees payable
hereunder, or reduce the amount of, waive or excuse any such payment,
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or postpone the scheduled date of expiration of any Commitment,
without the written consent of each Lender adversely affected thereby,
(iv) change Section 2.15(b) or (c) in a manner that would alter
the pro rata sharing of payments required thereby, without the written
consent of each Lender adversely affected thereby,
(v) change any of the provisions of this Section or the
definition of "Required Lenders" or any other provision hereof
specifying the number or percentage of Lenders required to waive,
amend or modify any rights hereunder or make any determination or
grant any consent hereunder, without the written consent of each
Lender,
(vi) release any material portion of the Collateral without the
written consent of each Lender, and
(vii) amend, modify or otherwise affect the rights or duties of
the Senior Agent hereunder without the prior written consent of the
Senior Agent.
SECTION 9.03. EXPENSES; INDEMNITY; DAMAGE WAIVER.
(a) COSTS AND EXPENSES. The Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by the Senior Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Senior Agent, in connection with the preparation and administration of the
Credit Documents or any amendments, modifications or waivers of the provisions
thereof (whether or not the transactions contemplated hereby or thereby shall be
consummated), and (ii) all out-of-pocket expenses incurred by the Senior Agent
or any Lender, including the fees, charges and disbursements of any counsel for
the Senior Agent or any Lender, in connection with the enforcement or protection
of its rights in connection with the Credit Documents, including its rights
under this Section, or in connection with the Loans made hereunder, including
all such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans.
(b) INDEMNIFICATION BY BORROWER. The Borrower shall indemnify the
Senior Agent and each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an "INDEMNITEE") against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses, including the fees, charges and disbursements of any counsel
for any Indemnitee, incurred by or asserted against any Indemnitee arising out
of, in connection with, or as a result of (i) the execution or delivery of this
Agreement or any agreement or instrument contemplated hereby, the performance by
the parties hereto of their respective obligations hereunder or the consummation
of the Transactions or any other transactions contemplated hereby, (ii) any Loan
or the use of the proceeds therefrom, (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property owned or operated by the
Borrower, or any Environmental Liability related in any way to the Borrower, or
(iv) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto; 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.
(c) INDEMNIFICATION BY LENDERS. To the extent that the Borrower
fails to pay any amount required to be paid by it to the Senior Agent under
paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the
Senior Agent such Lender's Applicable Percentage (determined as of the time that
the applicable unreimbursed expense or indemnity payment is sought) of such
unpaid amount; PROVIDED that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against the Senior Agent in its capacity as such.
(d) WAIVER OF CONSEQUENTIAL DAMAGES, ETC. To the extent permitted
by applicable law, the Borrower shall not assert, and hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions or any Loan or the
use of the proceeds thereof.
SECTION 9.04. SUCCESSORS AND ASSIGNS.
(a) ASSIGNMENTS GENERALLY. The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that (i) the Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder
(except as provided in the CDS Security Agreement) without the prior written
consent of each Lender (and any attempted assignment or transfer by the Borrower
without such consent shall be null and void) and (ii) no Lender may assign or
otherwise transfer its rights or obligations hereunder except in accordance with
this Section. Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants (to the extent
provided in paragraph (c) of this Section) and, to the extent expressly
contemplated hereby, the Related Parties of each of the Senior Agent and the
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
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(b) ASSIGNMENTS BY LENDERS.
(i) ASSIGNMENTS GENERALLY. Subject to the conditions set forth in
paragraph (b)(ii) below, any Lender may assign to one or more assignees all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it) with the prior
written consent (such consent not to be unreasonably withheld) of:
(A) the Borrower, PROVIDED that no consent of the Borrower shall
be required for an assignment to a Lender, an Affiliate of a Lender,
an Approved Fund or, if an Event of Default has occurred and is
continuing, any other assignee; and
(B) the Senior Agent, PROVIDED that no consent of the Senior
Agent shall be required for an assignment of all or any portion of the
Commitments or Loans to a Lender.
(ii) CERTAIN CONDITIONS TO ASSIGNMENTS. Assignments shall be
subject to the following additional conditions:
(A) except in the case of an assignment to a Lender or an
Affiliate of a Lender or an assignment of the entire remaining amount
of the assigning Lender's Commitment or Loans, the amount of the
Commitment or Loans of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Senior Agent)
shall not be less than $5,000,000 unless each of the Borrower and the
Senior Agent otherwise consent, PROVIDED that no such consent of the
Borrower shall be required if an Event of Default has occurred and is
continuing;
(B) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and
obligations under this Agreement;
(C) the parties to each assignment shall execute and deliver to
the Senior Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500;
(D) the assignee, if it shall not be a Lender, shall deliver to
the Senior Agent an Administrative Questionnaire; and
(E) the assignee shall satisfy the Lender Rating Criteria or the
alternative requirements of Section 2.17 on the date of such
assignment.
(iii) EFFECTIVENESS OF ASSIGNMENTS. Subject to acceptance and
recording thereof pursuant to paragraph (b)(iv) of this Section, from and after
the effective date specified in each Assignment and Assumption the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the 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, 2.13, 2.14 and 9.03). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this Section shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (c) of this Section. Notwithstanding
anything to the contrary contained herein, the Borrower shall not be obligated
to pay to any assignee of any Lender any amount under any of Sections 2.12, 2.13
or 2.14 greater than the amount the Borrower would have been obligated to pay to
such Lender if such Lender had not made any assignment to such assignee of such
Lender's rights under this Agreement, unless such assignment is made at a time
when the circumstances giving rise to such greater payments did not exist.
(iv) MAINTENANCE OF REGISTER. The Senior Agent, acting for this
purpose as an agent of the Borrower, shall maintain at one of its offices a copy
of each Assignment and Assumption 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 Senior Agent 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 and
any Lender, at any reasonable time and from time to time upon reasonable prior
notice.
(v) ACCEPTANCE OF ASSIGNMENTS BY SENIOR AGENT. Upon its receipt
of a duly completed Assignment and Assumption executed by an assigning Lender
and an assignee, the assignee's completed Administrative Questionnaire (unless
the assignee shall already be a Lender hereunder), the processing and
recordation fee referred to in paragraph (b) of this Section and any written
consent to such assignment required by paragraph (b) of this Section, the Senior
Agent shall accept such Assignment and Assumption and record the information
29
contained therein in the Register. No assignment shall be effective for purposes
of this Agreement unless it has been recorded in the Register as provided in
this paragraph.
(c) PARTICIPATIONS.
(i) PARTICIPATIONS GENERALLY. Any Lender may, without the consent
of the Borrower or the Senior Agent, sell participations to one or more banks or
other entities (a "PARTICIPANT") in all or a portion of such Lender's rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans owing to it); PROVIDED that (A) such Lender's obligations under
this Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Senior Agent, and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; PROVIDED
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 9.02(b) that affects such Participant.
Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section.
(ii) LIMITATIONS ON RIGHTS OF PARTICIPANTS. A Participant shall
not be entitled to receive any greater payment under Section 2.12 or 2.14 than
the applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower's prior written consent. A
Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section 2.14 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrower, to comply with Section 2.14(e) as though it were a
Lender.
(d) CERTAIN PLEDGES. Any Lender may at any time pledge or assign
a security interest in all or any portion of its rights under this Agreement to
secure obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; PROVIDED that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
(e) NO TRANSFERS TO THE BORROWER OR AFFILIATES. Anything in this
Section to the contrary notwithstanding, no Lender may sell, assign, participate
or in any way transfer any interest in any Loan held by it to the Borrower or
any of its Affiliates without the prior consent of each Lender.
SECTION 9.05. SURVIVAL. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Senior Agent or any Lender may have had
notice or knowledge of any Default or incorrect representation or warranty at
the time any credit is extended hereunder, 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 is outstanding and unpaid
and so long as the Commitments have not expired or terminated. The provisions of
Sections 2.12, 2.13, 2.14, 9.03 and 9.13 and Article VIII shall survive and
remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Commitments or the termination of this Agreement or any
provision hereof.
SECTION 9.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS. 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. This Agreement and any
separate letter agreements with respect to fees payable to the Senior Agent
constitute the entire contract among the parties relating to the subject matter
hereof and supersede any and all previous agreements and understandings, oral or
written, relating to the subject matter hereof. Except as provided in Section
4.01, this Agreement shall become effective when it shall have been executed by
the Senior Agent and when the Senior Agent shall have received counterparts
hereof which, when taken together, bear the signatures of each of the other
parties hereto, and thereafter shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns. Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall be
effective as delivery of a manually executed counterpart of this Agreement.
SECTION 9.07. SEVERABILITY. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
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SECTION 9.08. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
PROCESS.
(a) GOVERNING LAW. This Agreement shall be construed in
accordance with and governed by the law of the State of New York.
(b) SUBMISSION TO JURISDICTION. The Borrower hereby irrevocably
and unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement, 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
Senior Agent or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement against the Borrower or its properties in the courts
of any jurisdiction.
(c) WAIVER OF VENUE. 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 in
any court referred to in paragraph (b) of this Section. 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.
(d) SERVICE OF PROCESS. 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 9.09. 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 ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). 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 BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.10. 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 shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.11. CONFIDENTIALITY. Each of the Senior Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent requested
by any regulatory authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d to any other party
to this Agreement, (e) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
the Borrower and its obligations, (g) with the consent of the Borrower or (h) to
the extent such Information (i) becomes publicly available other than as a
result of a breach of this Section or (ii) becomes available to the Senior Agent
or any Lender on a nonconfidential basis from a source other than the Borrower.
For the purposes of this Section, "INFORMATION" means all information received
from the Borrower relating to the Borrower or its business, other than any such
information that is available to the Senior Agent or any Lender on a
nonconfidential basis prior to disclosure by the Borrower; PROVIDED that, in the
case of information received from the Borrower after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.
SECTION 9.12. USA PATRIOT ACT. Each Lender hereby notifies the
Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001)), such Lender may be required
to obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Lender to identify the Borrower in accordance with said
Act.
31
SECTION 9.13. NO PETITION; LIMITED RECOURSE. Each of the Lenders and
the Senior Agent (collectively, the "CREDITORS") agrees (which agreement shall,
pursuant to the terms of this Agreement, be binding upon its successors,
assigns, and participants) that it shall not institute against, or join any
other Person in instituting against, the Borrower any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding, or other
proceeding under any federal or state bankruptcy or similar law, for one year
and a day (or, if longer, the then applicable preference period) after the
payment in full of all amounts due hereunder and the Mezzanine Facility.
Notwithstanding anything herein or any other Program Document to the contrary,
the obligations of the Borrower owing to the Creditors hereunder or thereunder
are limited recourse and are payable only from the property and assets of the
Borrower, only to the extent funds are available for payment of such obligations
in accordance with Sections 13.1 and 13.3 of the Operating Agreement. No
recourse shall be had and no claim shall be made, whether by levy or execution
or otherwise, for the payment or satisfaction of any obligations of the Borrower
hereunder or under any other Program Document against any member of the Borrower
or any of its assets, other than the property and assets of the Borrower, and no
member of the Borrower shall be liable for any deficiency judgment based
thereon, it being expressly understood and agreed that the sole remedies of each
of the Creditors with respect to such amounts shall be against the property and
assets of the Borrower in accordance with this Agreement and the other Program
Documents.
SECTION 9.14. RIGHT OF SET-OFF. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates 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 obligations at any time
owing by such Lender or Affiliate 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 held by such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured, PROVIDED that any amounts collected by any
Lender or its Affiliates pursuant to this Section shall be subject to and paid
in accordance with Sections 13.1 and 13.3 of the Operating Agreement. The rights
of each Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.
32
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.
CENTERBROOK FINANCIAL LLC
By: CENTERBROOK HOLDINGS LLC, its Managing Member
By: /S/ XXXXXX XXXX
---------------
Name: Xxxxxx Xxxx
Title: Chief Executive Officer
CITIBANK, N.A.,
as Senior Agent
By: /S/ XXXXX XXXXXX
----------------
Name: Xxxxx XxXxxx
Title: Vice President
33
LENDERS
-------
CITIBANK, N.A.
By: /S/ XXXXX XXXXXX
----------------
Name: Xxxxx XxXxxx
Title: Vice President
IXIS FINANCIAL PRODUCTS INC.
By: /S/ X. XXXXXXX
--------------
Name: X. Xxxxxxx
Title: Managing Director
By: /S/ XXXXXXXXXXX XXXXXX
----------------------
Name: Xxxxxxxxxxx Xxxxxx
Title: Managing Director
CHARTERMAC
By: /S/ XXXX X. XXXXXXXXX
---------------------
Name: Xxxx X. Xxxxxxxxx
Title: Chief Executive Officer
34
SCHEDULE 2.01
COMMITMENTS
-----------
[See definitions of "Commitments" and "Lenders" in Section 1.01]
NAME OF LENDER COMMITMENT
-------------- -----------
CharterMac $ 5,000,000
Citibank, N.A. $10,000,000
IXIS Financial Products Inc. $15,000,000
--------------------------------------------------------------------------------
TOTAL $30,000,000
EXHIBIT A
[Exhibit Omitted]
EXHIBIT B
[Exhibit Omitted]
EXHIBIT C
[Exhibit Omitted]
