EXHIBIT 10(a)
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$200,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
(Facility A)
AMONG
LA QUINTA INNS, INC.
CERTAIN LENDERS
AND
NATIONSBANK OF TEXAS, N.A., AS ADMINISTRATIVE LENDER
September 12, 1995
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TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS
Section 1.1 DEFINED TERMS.......................................... 1
Section 1.2 AMENDMENTS AND RENEWALS................................ 20
Section 1.3 CONSTRUCTION........................................... 20
ARTICLE 2
ADVANCES
Section 2.1 THE ADVANCES........................................... 21
(a) REVOLVING CREDIT ADVANCES.............................. 21
(b) THE SWING LINE LOANS................................... 21
(c) BID RATE ADVANCES...................................... 21
Section 2.2 MANNER OF BORROWING AND DISBURSEMENT................... 22
Section 2.3 INTEREST............................................... 26
(a) ON BASE RATE ADVANCES.................................. 26
(b) ON LIBOR ADVANCES...................................... 26
(c) ON SWING LINE ADVANCES................................. 26
(d) ON BID RATE ADVANCES................................... 27
(e) INTEREST IF NO NOTICE OF SELECTION OF INTEREST
RATE BASIS............................................. 27
(f) INTEREST AFTER AN EVENT OF DEFAULT..................... 27
Section 2.4 FEES................................................... 27
(a) FACILITY FEE........................................... 27
(b) CLOSING FEE............................................ 28
(c) OTHER FEES............................................. 28
Section 2.5 PREPAYMENT............................................. 29
(a) VOLUNTARY PREPAYMENTS.................................. 29
(b) MANDATORY PREPAYMENT................................... 29
(c) PREPAYMENTS, GENERALLY................................. 29
Section 2.6 REDUCTION OF COMMITMENT................................ 29
(a) VOLUNTARY REDUCTION.................................... 29
(b) MANDATORY REDUCTION.................................... 30
(c) GENERAL REQUIREMENTS................................... 30
Section 2.7 NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE LENDER...... 30
Section 2.8 PAYMENT OF PRINCIPAL OF ADVANCES....................... 30
(a) END OF INTEREST PERIOD................................. 30
(b) COMMITMENT REDUCTION................................... 30
(c) MATURITY DATE.......................................... 31
Section 2.9 REIMBURSEMENT.......................................... 31
Section 2.10 MANNER OF PAYMENT...................................... 31
Section 2.11 LIBOR LENDING OFFICES.................................. 32
Section 2.12 SHARING OF PAYMENTS.................................... 32
Section 2.13 CALCULATION OF RATES................................... 33
Section 2.14 BOOKING LOANS.......................................... 33
Section 2.15 TAXES.................................................. 33
Section 2.16 LETTERS OF CREDIT...................................... 36
(a) THE LETTER OF CREDIT FACILITY.......................... 36
(b) REQUEST FOR ISSUANCE................................... 37
(c) DRAWING AND REIMBURSEMENT.............................. 37
(d) INCREASED COSTS........................................ 38
(e) OBLIGATIONS ABSOLUTE................................... 38
(f) COMPENSATION........................................... 40
(g) L/C CASH COLLATERAL ACCOUNT............................ 42
ARTICLE 3
CONDITIONS PRECEDENT
Section 3.1 CONDITIONS PRECEDENT TO THE INITIAL ADVANCES AND THE
INITIAL LETTERS OF CREDIT............................. 43
Section 3.2 CONDITIONS PRECEDENT TO ALL ADVANCES AND LETTERS OF
CREDIT................................................ 45
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Section 4.1 REPRESENTATIONS AND WARRANTIES........................ 46
(a) ORGANIZATION; POWER; QUALIFICATION.................... 47
(b) AUTHORIZATION......................................... 47
(c) COMPLIANCE WITH OTHER LOAN PAPERS AND CONTEMPLATED
TRANSACTIONS.......................................... 47
(d) LICENSES, ETC......................................... 47
(e) COMPLIANCE WITH LAW................................... 48
(f) TITLE TO PROPERTIES................................... 48
(g) LITIGATION............................................ 48
(h) TAXES................................................. 48
(i) FINANCIAL STATEMENTS; MATERIAL LIABILITIES............ 48
(j) NO ADVERSE CHANGE..................................... 49
(k) ERISA................................................. 49
(l) COMPLIANCE WITH REGULATIONS G, T, U AND X............. 50
(m) GOVERNMENTAL REGULATION............................... 50
(n) ABSENCE OF DEFAULT.................................... 50
(o) INVESTMENT COMPANY ACT................................ 51
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(p) ENVIRONMENTAL MATTERS................................. 51
(q) CERTAIN FEES.......................................... 52
(r) NECESSARY AUTHORIZATIONS.............................. 52
(s) PATENTS, ETC.......................................... 52
(t) DISCLOSURE............................................ 52
(u) SOLVENCY.............................................. 52
Section 4.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC....... 53
ARTICLE 5
BUSINESS COVENANTS
Section 5.1 MAINTENANCE OF PROPERTY, INSURANCE, ACCOUNTING
PRACTICES, CORPORATE EXISTENCE........................ 53
Section 5.2 INSPECTION OF PROPERTIES AND BOOKS.................... 54
Section 5.3 MERGER AND SALE OF ASSETS............................. 54
Section 5.4 NET WORTH............................................. 55
Section 5.5 CONTINGENT LIABILITIES................................ 55
Section 5.6 INCURRENCE AND RETENTION OF DEBT...................... 55
Section 5.7 INVESTMENTS........................................... 56
Section 5.8 NOTICE OF LITIGATION.................................. 56
Section 5.9 TOTAL DEBT RATIO...................................... 56
Section 5.10 CASH FLOW RATIO....................................... 56
Section 5.11 SENIOR DEBT RATIO..................................... 56
Section 5.12 LIENS................................................. 57
Section 5.13 ACCOUNTING CHANGES.................................... 57
Section 5.14 AMENDMENT AND MODIFICATION OF SUBORDINATED DEBT
DOCUMENTS............................................. 57
Section 5.15 LEASE-BACKS........................................... 57
Section 5.16 ENVIRONMENTAL MATTERS................................. 57
Section 5.17 ERISA COMPLIANCE...................................... 58
Section 5.18 BUSINESS.............................................. 59
Section 5.19 DEBT.................................................. 59
Section 5.20 TRANSACTIONS WITH AFFILIATES.......................... 59
Section 5.21 USE OF PROCEEDS....................................... 59
Section 5.22 INDEMNITY............................................. 59
ARTICLE 6
INFORMATION
Section 6.1 FINANCIAL STATEMENTS AND OTHER REPORTS BY THE
BORROWER.............................................. 61
Section 6.2 OFFICER'S CERTIFICATE................................. 63
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ARTICLE 7
DEFAULT
Section 7.1 EVENTS OF DEFAULT..................................... 63
Section 7.2 REMEDIES.............................................. 66
ARTICLE 8
CHANGES IN CIRCUMSTANCES
Section 8.1 LIBOR BASIS DETERMINATION INADEQUATE.................. 67
Section 8.2 ILLEGALITY............................................ 67
Section 8.3 INCREASED COSTS....................................... 67
Section 8.4 EFFECT ON BASE RATE ADVANCES.......................... 69
Section 8.5 CAPITAL ADEQUACY...................................... 69
ARTICLE 9
AGREEMENT AMONG LENDERS
Section 9.1 AGREEMENT AMONG LENDERS............................... 70
(a) ADMINISTRATIVE LENDER................................. 70
(b) REPLACEMENT OF ADMINISTRATIVE LENDER.................. 70
(c) EXPENSES.............................................. 70
(d) DELEGATION OF DUTIES.................................. 71
(e) RELIANCE BY ADMINISTRATIVE LENDER..................... 71
(f) LIMITATION OF ADMINISTRATIVE LENDER'S LIABILITY....... 71
(g) LIABILITY AMONG LENDERS............................... 72
(h) RIGHTS AS LENDER...................................... 72
Section 9.2 LENDER CREDIT DECISION................................ 72
Section 9.3 BENEFITS OF ARTICLE................................... 72
ARTICLE 10
MISCELLANEOUS
Section 10.1 NOTICES............................................... 72
Section 10.2 EXPENSES.............................................. 73
Section 10.3 WAIVERS............................................... 73
Section 10.4 DETERMINATION BY THE LENDERS CONCLUSIVE AND BINDING... 74
Section 10.5 SET-OFF............................................... 74
Section 10.6 ASSIGNMENT............................................ 74
Section 10.7 COUNTERPARTS.......................................... 77
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Section 10.8 SEVERABILITY.......................................... 77
Section 10.9 INTEREST AND CHARGES.................................. 77
Section 10.10 CONFIDENTIALITY....................................... 77
Section 10.11 HEADINGS.............................................. 78
Section 10.12 AMENDMENT AND WAIVER.................................. 78
Section 10.13 EXCEPTION TO COVENANTS................................ 78
Section 10.14 NO LIABILITY OF ISSUING BANK.......................... 79
Section 10.15 TERMINATION OF PARTICIPATIONS IN BOND LETTERS OF
CREDIT................................................ 79
Section 10.16 TERMINATION OF COMMITMENT............................. 79
SECTION 10.17 GOVERNING LAW.................................... 79
SECTION 10.18 WAIVER OF JURY TRIAL............................. 80
SECTION 10.19 ENTIRE AGREEMENT................................. 80
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SCHEDULES AND EXHIBITS
Schedule 1: LIBOR Lending Offices
Schedule 2: Existing Litigation
Schedule 3: Subsidiaries and Unincorporated Ventures
Schedule 4: Existing Investments
Schedule 5: Investment Policy
Schedule 6: Unincorporated Ventures to be Purchased
Schedule 7: Benefit Agreements With Former Employees
Schedule 8: Insolvent Unincorporated Ventures
Schedule 9: Existing Letters of Credit
Schedule 10: Significant Investments
Schedule 11: Guaranteed Contingent Obligations
Schedule 12: Existing Liens
Exhibit A: Revolving Credit Note
Exhibit B: Bid Rate Note
Exhibit C: Swing Line Note
Exhibit D: Subsidiary Guaranty
Exhibit E: Assignment Agreement
Exhibit F: Confidentiality Agreement
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AMENDED AND RESTATED CREDIT AGREEMENT
(Facility A)
THIS AMENDED AND RESTATED CREDIT AGREEMENT (Facility A) is dated as of
September 12, 1995, among LA QUINTA INNS, INC., a Texas corporation
("Borrower"), the Lenders from time to time party hereto, and NATIONSBANK OF
TEXAS, N.A., a national banking association, as administrative agent for the
Lenders.
BACKGROUND
The Borrower, certain of the Lenders and the Administrative Lender are
parties to that Credit Agreement dated as of January 25, 1994 (said Credit
Agreement, as amended, the "Existing Credit Agreement"). The Borrower has
requested that the Lenders amend and restate the Existing Credit Agreement by
making a credit facility available to the Borrower in the maximum principal
amount of (i) $50,000,000 pursuant to the Facility B Credit Agreement (as herein
defined) and (ii) $200,000,000 pursuant to this Agreement. The Lenders have
agreed to provide the $200,000,000 credit facility, subject to the terms and
conditions set forth below.
In consideration of the mutual covenants and agreements contained herein,
and other good and valuable consideration hereby acknowledged, the parties
hereto agree that the Existing Credit Agreement is amended and restated in its
entirety, together with the Facility B Credit Agreement, as follows:
ARTICLE 1
DEFINITIONS
Section 1.1 DEFINED TERMS. For purposes of this Agreement:
"ADDITIONAL COSTS" has the meaning set forth in Section 8.5 hereof.
"ADJUSTMENT DATE" means, for purposes of the Applicable Margin, the
facility fees payable pursuant to Section 2.4(a) hereof and the Letter of
Credit fees payable pursuant to Sections 2.16(f)(i) and 2.16(f)(ii) hereof,
(i) when the Applicable Margin and such fees are based on the Leverage Ratio,
the date of receipt by the Administrative Lender of the financial statements
required to be delivered pursuant to Section 6.1(a) or 6.1(b) hereof which
results in a change in the Applicable Margin and (ii) when the Applicable
Margin and such fees are based on the Index Debt Rating, the effective date
of any issuance of, or change in, the Index Debt Rating which results in a
change in the Applicable Margin.
"ADMINISTRATIVE LENDER" means NationsBank of Texas, N.A., a national
banking association, as administrative agent for Lenders, or such successor
administrative agent appointed pursuant to Section 9.1(b) hereof.
"ADVANCE" means a Revolving Credit Advance, a Swing Line Advance or a
Bid Rate Advance and "ADVANCES" means Revolving Credit Advances, Swing Line
Advances and Bid Rate Advances.
"AFFILIATE" means any Person that directly or indirectly through one or
more Subsidiaries Controls, or is Controlled By or Under Common Control with,
the Borrower.
"AGREEMENT" means this Credit Agreement, as amended, modified,
supplemented and restated from time to time.
"AGREEMENT DATE" means the date of this Agreement.
"APPLICABLE ENVIRONMENTAL LAWS" means applicable laws pertaining to
health or the environment, including without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended by
the Superfund Amendments and Reauthorization Act of 1986 (as amended from time
to time, "CERCLA"), the Resource Conservation and Recovery Act of 1976, as
amended by the Used Oil Recycling Act of 1980, the Solid Waste Disposal Act
amendments of 1980, and the Hazardous and Solid Waste Amendments of 1984 (as
amended from time to time, "RCRA"), the Texas Water Code, and the Texas Solid
Waste Disposal Act.
"APPLICABLE LAW" means (a) in respect of any Person, all provisions of
constitutions, statutes, rules, regulations and orders of governmental bodies
or regulatory agencies applicable to such Person and its properties,
including, without limiting the foregoing, all orders and decrees of all
courts and arbitrators in proceedings or actions to which the Person in
question is a party, and (b) in respect of contracts relating to interest or
finance charges that are made or performed in the State of Texas, "APPLICABLE
LAW" shall mean the laws of the United States of America, including without
limitation 12 USC Sections 85 and 86, as amended from time to time, and any
other statute of the United States of America now or at any time hereafter
prescribing the maximum rates of interest on loans and extensions of credit,
and the laws of the State of Texas, including, without limitation, Article
5069-1.04, Title 79, Revised Civil Statutes of Texas, 1925, as amended ("Art.
1.04"), and any other statute of the State of Texas now or at any time
hereafter prescribing maximum rates of interest on loans and extensions of
credit; provided that the parties hereto agree that the provisions of Chapter
15, Title 79, Revised Civil Statutes of Texas, 1925, as amended, shall not
apply to Advances, this Agreement, the Notes or any other Loan Papers.
"APPLICABLE MARGIN" means the following per annum percentages,
applicable in the following situations:
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BASE RATE LIBOR
APPLICABILITY BASIS BASIS
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CATEGORY 1 - The Leverage Ratio is not less than 3.50 to 1 0.00 0.70
or the Index Debt Rating is any two of the following: BB by
S&P, BB by ARA or Ba2 by Xxxxx'x
CATEGORY 2 - The Leverage Ratio is less than 3.50 to 1 but 0.00 0.55
not less than 3.00 to 1 or the Index Debt Rating is any two
of the following: BB+ by S&P, BB+ by ARA or Ba1 by Xxxxx'x
CATEGORY 3 - The Leverage Ratio is less than 3.00 to 1 but 0.00 0.45
not less than 2.50 to 1 or the Index Debt Rating is any two
of the following: BBB- by S&P, BBB- by ARA or Baa3 by Xxxxx'x
CATEGORY 4 - The Leverage Ratio is less than 2.50 to 1 but not 0.00 0.35
less than 2.0 to 1 or the Index Debt Rating is any two of the
following: BBB by S&P, BBB by ARA or Baa2 by Xxxxx'x
CATEGORY 5 - The Leverage Ratio is less than 2.00 to 1 or the 0.00 0.30
Index Debt Rating is any two of the following: BBB+ or better
by S&P, BBB+ or better by ARA or Baa1 or better by Xxxxx'x
The Applicable Margin payable by the Borrower on the Revolving Credit Advances
outstanding hereunder shall be adjusted on each Adjustment Date if determined
based on the (i) Leverage Ratio, according to the performance of the Borrower
for the most recent fiscal quarter or (ii) the Index Debt Rating, according to
the most recent determination of the Index Debt Rating. For purposes of the
foregoing, (a) if the Index Debt Rating and the Leverage Ratio are in different
categories, the Applicable Margin shall be determined on whichever of the Index
Debt Rating or the Leverage Ratio falls within the superior (or numerically
higher) category, (b) if the Applicable Margin is determined based on the
Leverage Ratio and the financial statements of the Borrower setting forth the
Leverage Ratio are not received by the Administrative Lender by the date
required pursuant to Section 6.1(a) or 6.1(b), the Applicable Margin shall be
determined as if the Leverage Ratio is not less than 3.50 to 1 until such time
as the financial statements are received, (c) if the Index Debt Rating
established by ARA shall fall within a different category than both Xxxxx'x and
S&P, the Applicable Margin shall be determined by reference to Xxxxx'x or S&P,
whichever shall be the superior (or numerically higher) category, but not to
exceed two rating levels higher than the other rating agency. If the rating
system of Xxxxx'x, S&P or ARA shall change prior to the Maturity Date, the
Borrower and the Lenders shall negotiate in good faith to amend the references
to specific ratings in this definition to reflect such changed rating system.
"ARA" means Duff & Xxxxxx Credit Ratings Company or Fitch Investor
Services or any other nationally recognized rating agency approved in writing
by the Determining Lenders which shall have a rating system identical to S&P.
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"ART. 1.04" has the meaning specified in the definition of "Applicable
Law."
"ASSIGNEES" means any assignee of a Lender pursuant to an Assignment
Agreement and has the meaning specified in Section 10.6 hereof.
"ASSIGNMENT AGREEMENT" has the meaning specified in Section 10.6 hereof.
"AUTHORIZED OFFICER" means any of the following officers of the
Borrower: President, Senior Vice President-Accounting & Administration, Senior
Vice President-Finance, Vice President & General Counsel or Vice
President-Treasurer.
"AUTHORIZED SIGNATORY" means such senior personnel of the Borrower as
may be duly authorized and designated in writing by the Borrower to execute
documents, agreements and instruments on behalf of the Borrower, and to request
Advances or Letters of Credit hereunder.
"BASE RATE ADVANCE" means a Revolving Credit Advance which the Borrower
requests to be made as a Base Rate Advance or which is reborrowed as a Base Rate
Advance, in accordance with the provisions of Section 2.2 hereof.
"BASE RATE BASIS" means, for any day, a per annum interest rate equal
to the higher of (a) the sum of (i) 0.50% plus (ii) the Federal Funds Rate on
such day plus (iii) the Applicable Margin, or (b) the sum of (i) the Prime
Rate on such day plus (ii) the Applicable Margin. The Base Rate Basis shall
be adjusted automatically as of the opening of business on the effective date
of each change in the Prime Rate to account for such change.
"BID RATE ADVANCE" means an Advance the interest rate on which is
determined by agreement between the Borrower and the Lender making such Advance
pursuant to Section 2.1(c) hereof.
"BID RATE NOTE" means each promissory note of the Borrower evidencing
Bid Rate Advances, substantially in the form of EXHIBIT B hereto, together
with any extension, renewal or amendment thereof or substitution therefor.
"BOND LETTERS OF CREDIT" has the meaning specified in the Existing
Credit Agreement.
"BORROWER" means La Quinta Inns, Inc., a Texas corporation.
"BUSINESS DAY" means a day on which banks are open for the transaction
of business in Dallas, Texas and New York, New York, and, with respect to any
LIBOR Advance, in London, England.
"CAPITAL LEASES" mean all capital leases and subleases, as defined in
the Financial Accounting Standards Board Statement of Financial Accounting
Standards No. 13, dated November 1976, as amended.
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"CAPITAL STOCK" means, with respect to any Person, any capital stock,
partnership or joint venture interests of such Person and shares, interests,
participations or other ownership interests (however designated) of any Person
and any rights (other than debt securities convertible into corporate stock),
warrants or options to purchase any of the foregoing.
"CAPITALIZED LEASE OBLIGATIONS" means that portion of any obligation of
the Borrower or any Subsidiary as lessee under a lease which at the time would
be required to be capitalized on a balance sheet prepared in accordance with
GAAP.
"CHANGE OF CONTROL" means (a) any "person" or "group" (as such terms
are used for purposes of Sections 13(d) and 14(d) of the Exchange Act,
whether or not applicable), is or becomes the "beneficial owner" (as that
term is used in Rules 13d-3 and 13d-5 under the Exchange Act, whether or not
applicable, except that a person shall be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire,
whether such right is exercisable immediately or only after the passage of
time, directly or indirectly, of more than 50% of the total voting power in
the aggregate of all classes of Capital Stock then outstanding of the
Borrower normally entitled to vote in elections of directors, PROVIDED, that
for the purposes of this clause (a), neither Xxxxxx X. Xxxxxx & Co., Trust
for the benefit of Xx. Xxxxxx'x son, Xxx X. Xxxx, Inc., Xxx X. Xxxx, Inc.,
The Bass Management Trust, Xxxxx X. Xxxx Trust for Xxx X. Xxxx, Xxx X. Xxxx
Trust for Xxx X. Xxxx, Xxxxx Xxxxxxxx Trusts nor Xxxxx Xxxxxxxx, each of
which is a principal shareholder of the Borrower as of the Agreement Date,
nor any person who on the Agreement Date is, or at any time thereafter
becomes, a member of any group which includes any of such entities and
persons, shall be deemed to be a "person" or "group" for purposes of this
definition, or (b) during any period of 24 consecutive months after September
12, 1995, individuals who at the beginning of such period constituted the
Board of Directors of the Borrower (together with any new directors whose
election by such Board or whose nomination for election by the shareholders
of the Borrower was approved by a vote of a majority of the directors then
still in office who were either directors at the beginning of such period or
whose election or nomination for election was previously so approved), cease
for any reason to constitute a majority of the Board of Directors of the
Borrower then in office.
"CODE" means the Internal Revenue Code of 1986, as amended, together
with all regulations thereunder.
"COMBINED" means, with respect to financial statements, the combined
accounts of the Borrower, its Subsidiaries and Unincorporated Ventures which
are included in the Borrower's Annual Report to Shareholders and in the
Borrower's Form 10-K filed with the Securities and Exchange Commission (the
"Combined Financial Statements").
"COMMITMENT" means $200,000,000, as reduced pursuant to Section 2.6
hereof.
"CONFIDENTIALITY AGREEMENT" has the meaning specified in Section 10.10
hereof.
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"CONSOLIDATED NET INCOME" means, for any period, determined in
accordance with GAAP on a Combined basis, consolidated net income for such
period.
"CONTROL" or "CONTROLLED BY" or "UNDER COMMON CONTROL" means
possession, directly or indirectly, of power to direct or cause the direction
of management or policies (whether through ownership of voting securities, by
contract or otherwise); provided, however, that in any event any Person which
beneficially owns, directly or indirectly, 10% or more (in number of votes)
of the securities having ordinary voting power for the election of directors
of a corporation shall be conclusively presumed to control such corporation.
"CONTROLLED GROUP" shall mean as of the applicable date, as to any
Person, all members of a controlled group of corporations and all trades or
businesses (whether or not incorporated) which are under common control with
such Person and which, together with such Person, are treated as a single
employer under Section 414(b), (c), (m) or (o) of the Code; provided, however,
that the Subsidiaries and Unincorporated Ventures of the Borrower shall be
deemed to be members of the Borrower's Controlled Group.
"CURRENT MATURITIES" means, with respect to any Person, the principal
portion payable by such Person on Long Term Debt during the twelve-month period
immediately succeeding the date of determination.
"DEBT" of any Person means, at any date, without duplication, all
obligations, contingent or otherwise, (a) of such Person for borrowed money
(whether or not the recourse of the lender is to the whole of the assets of
such Person or only to a portion thereof), (b) of such Person evidenced by
bonds, debentures, notes or other similar instruments, (c) representing the
balance deferred and unpaid of the purchase price of any property or services
(other than accounts payable or other obligations arising in the ordinary
course of business), if and to the extent any of the foregoing described in
clauses (a), (b) and (c) would appear as a liability on the balance sheet of
such Person, (d) of such Person in respect of bankers' acceptances, letters
of credit or other similar instruments (or reimbursement obligations with
respect thereto), (e) of such Person under Capitalized Lease Obligations, (f)
all liabilities secured by a Lien on any asset of such Person to the extent
of the value of such asset, whether or not such liability is an obligation of
such Person, (g) all liability of others guaranteed by such Person (but only
to the extent of such guarantees), (h) to the extent not otherwise included,
obligations of such Person under currency risk-hedging agreements and
Interest Rate Protection Agreements, (i) the liquidation preference and any
mandatory redemption payment obligations (without duplication) of such
Person's Subsidiaries in respect of preferred stock issued by any such
Subsidiary, (j) in the case of such Person, the liquidation preference and
any mandatory redemption payment obligations (without duplication) in respect
of Disqualified Capital Stock, and (k) in the case of such Person, unfunded
vested benefits under any Plan.
"DEBTOR RELIEF LAWS" means any applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, insolvency, reorganization or similar
debtor relief Laws affecting the rights of creditors generally from time to
time in effect.
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"DEFAULT" means an Event of Default and/or any of the events specified
in Section 7.1, regardless of whether there shall have occurred any passage of
time or giving of notice that would be necessary in order to constitute such
event an Event of Default.
"DEFAULT RATE" means a simple per annum interest rate equal to the
lesser of (a) the Highest Lawful Rate, or (b) the sum of the Prime Rate plus
three percent.
"DETERMINING LENDERS" means, on any date of determination, any
combination of the Lenders having at least 51% of the aggregate amount of the
Revolving Credit Advances (which for purpose of the calculation shall include
for each Lender an amount equal to the product of such Lender's Specified
Percentage multiplied by the aggregate principal amount of Swing Line Loans
outstanding) and advances under the Facility B Credit Agreement then
outstanding; provided, however, that if there are no Revolving Credit Advances
outstanding hereunder and no advances outstanding under the Facility B Credit
Agreement, "DETERMINING LENDERS" shall mean any combination of Lenders whose
Specified Percentages hereunder and under the Facility B Credit Agreement
aggregate at least 51%.
"DISQUALIFIED CAPITAL STOCK" means, with respect to any Person any
series or class of Capital Stock of such Person which is or may be required to
be redeemed, in whole or in part, or may be put to such Person or any of its
Subsidiaries, in whole or in part, at the option of the Holder thereof, on or
prior to the final maturity of the Senior Subordinated Notes, or is or may be
convertible or exchangeable into or exercisable for such Capital Stock on or
prior to the final maturity of the Notes; PROVIDED, that Capital Stock will
not be deemed to be Disqualified Capital Stock if it may only be so redeemed or
put solely in consideration of Qualified Capital Stock.
"DOMESTIC SUBSIDIARY" means any Subsidiary of the Borrower organized
under the laws of any state within the United States.
"EBITDA" means, for any period, determined in accordance with GAAP on a
Combined basis, the sum of (a) Operating Income, plus (b) nonrecurring,
non-cash charges which decrease Operating Income, plus (c) depreciation,
amortization and non-cash fixed asset retirements, minus (d) nonrecurring
credits which are included in Operating Income.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any regulation promulgated thereunder.
"ERISA EVENT" means, with respect to the Borrower and its Subsidiaries,
(a) a Reportable Event (other than a Reportable Event not subject to the
provision for 30-day notice to the PBGC under regulations issued under
Section 4043 of ERISA), (b) the withdrawal of any such Person or any member
of its Controlled Group from a Plan subject to Title IV of ERISA during a
plan year in which it was a "substantial employer" as defined in Section
4001(a)(2) of ERISA, (c) the filing of a notice of intent to terminate under
Section 4041(c) of ERISA, (d) the institution of proceedings to terminate a
Plan by the PBGC, (e) the failure to make required contributions which could
result in the imposition of a lien under Section 412 of the Code or
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Section 302 of ERISA, or (f) any other event or condition which might
reasonably be expected to constitute grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Plan
or the imposition of any liability under Title IV of ERISA other than PBGC
premiums due but not delinquent under Section 4007 of ERISA.
"EVENT OF DEFAULT" means any of the events specified in Section 7.1,
provided that any requirement for notice or lapse of time has been satisfied.
"EXISTING CREDIT AGREEMENT" means that certain Amended and Restated
Credit Agreement, dated as of January 25, 1994, among the Borrower, the lenders
party thereto, and NationsBank of Texas, N.A., as Administrative Lender, as
amended, modified, supplemented or restated from time to time.
"EXISTING INVESTMENTS" means those Investments described on SCHEDULE 4
hereto.
"EXISTING LETTERS OF CREDIT" means those Letters of Credit outstanding
on the Agreement Date, as described on SCHEDULE 9 hereto.
"FACILITY B CREDIT AGREEMENT" means that certain Amended and Restated
Credit Agreement (Facility B), dated as of the Agreement Date, among the
Borrower, the lenders party thereto, and NationsBank of Texas, N.A., as
administrative lender, as amended, restated, supplemented or otherwise modified
from time to time.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upwards if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of Dallas on the Business Day next
succeeding such day, provided that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding
Business Day, and (b) if no such rate is so published on such next succeeding
Business Day, the Federal Funds Rate for such day shall be the average rate
quoted to the Administrative Lender on such day on such transactions as
determined by Administrative Lender.
"FEE LETTER" has the meaning specified in Section 2.4(c) hereof.
"FINANCIAL LETTER OF CREDIT" means any Letter of Credit issued under
the Letter of Credit Facility which is a "financial guarantee - type standby
letter of credit" as defined in Appendix A to 12 CFR Part 3 issued by the
Office of the Comptroller of the Currency.
"FOREIGN SUBSIDIARY" means any Subsidiary that is not a Domestic
Subsidiary.
"GAAP" means generally accepted accounting principles, set forth in the
Opinions of the Accounting Principles Board of the American Institute of
Certified Public Accountants, or their
- 8 -
successors which are applicable in the circumstances as of the date in
question (except as stated in the last sentence of this definition). The
requisite that such principles be applied on a consistent basis shall mean
that the accounting principles observed in a current period are comparable in
all material respects to those applied in a preceding period, except as
otherwise required by the adoption of Statements by the Financial Accounting
Standards Board. Notwithstanding the foregoing, each determination and
computation with respect to financial covenants and ratios in this Agreement
shall be made in accordance with GAAP as in effect on the Agreement Date.
"GUARANTY" or "GUARANTEED", as applied to an obligation of another
Person, means and includes (a) a guaranty, direct or indirect, in any manner,
of any part or all of such obligation, and (b) an agreement, direct or
indirect, contingent or otherwise, the practical effect of which is to assure
in any way the payment or performance (or payment of damages in the event of
nonperformance) of any part or all of such obligation, including, without
limiting the foregoing, any reimbursement obligations with respect to amounts
which may be drawn by beneficiaries of outstanding letters of credit.
"GUARANTY AGREEMENTS" means the Subsidiary Guaranty and any other
Guaranty executed by a Guarantor.
"GUARANTOR" means each Significant Subsidiary.
"HIGHEST LAWFUL RATE" means at the particular time in question the
maximum rate of interest which, under Applicable Law, the Lenders are then
permitted to charge on the Obligations. If the maximum rate of interest which,
under Applicable Law, the Lenders are permitted to charge on the Obligations
shall change after the date hereof, the Highest Lawful Rate shall be
automatically increased or decreased, as the case may be, from time to time as
of the effective time of each change in the Highest Lawful Rate without notice
to the Borrower. For purposes of determining the Highest Lawful Rate under the
Applicable Law of the State of Texas, the applicable rate ceiling shall be (a)
the indicated rate ceiling described in and computed in accordance with the
provisions of Section (a)(1) of Art. 1.04, or (b) if the parties subsequently
contract as allowed by Applicable Law, the quarterly ceiling or the annualized
ceiling computed pursuant to Section (d) of Art. 1.04; provided, however, that
at any time the indicated rate ceiling, the quarterly ceiling or the annualized
ceiling shall be less than 18% per annum or more than 24% per annum, the
provisions of Sections (b)(1) and (2) of said Art. 1.04 shall control for
purposes of such determination, as applicable.
"INCREASED ADVANCE COSTS" has the meaning specified in Section 8.3
hereof.
"INCREASED ADVANCE COSTS RETROACTIVE EFFECTIVE DATE" has the meaning
specified in Section 8.3 hereof.
"INCREASED ADVANCE COSTS SET DATE" has the meaning specified in Section
8.3 hereof.
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"INCREASED LETTER OF CREDIT COSTS" has the meaning specified in Section
2.16(d) hereof.
"INCREASED LETTER OF CREDIT COSTS RETROACTIVE EFFECTIVE DATE" has the
meaning specified in Section 2.16(d) hereof.
"INCREASED LETTER OF CREDIT COSTS SET DATE" has the meaning specified in
Section 2.16(d) hereof.
"INDEMNIFIED MATTERS" has the meaning specified in Section 5.22 hereof.
"INDEMNITEES" has the meaning specified in Section 5.22 hereof.
"INDEX DEBT RATING" means the rating applicable to the Borrower's
senior, unsecured, non-credit-enhanced long term indebtedness for borrowed
money ("Index Debt") or the implied rating established by Xxxxx'x, S&P or ARA
as if the Borrower had outstanding Index Debt.
"INSOLVENT UNINCORPORATED VENTURES" means those Unincorporated Ventures
specified on SCHEDULE 8 hereto.
"INTEREST EXPENSE" of any Person means, for any period, the aggregate
interest expense in respect of Debt (including amortization of original issue
discount and non-cash interest payments or accruals, and dividends on
Disqualified Capital Stock, but excluding amortization of Debt issuance costs)
of such Person and all commissions, discounts, other fees and charges owed with
respect to letters of credit and bankers' acceptance financing and costs
associated with currency and Interest Rate Protection Agreements, all in
accordance with GAAP; PROVIDED, that interest expense attributable to that
portion of the Debt of another Person that is a direct or indirect, contingent
or primary, recourse obligation of such Person subsequent to the Agreement Date
shall be added thereto.
"INTEREST PERIOD" means (a) for any Base Rate Advance, the period
beginning on the day the Advance was made and ending on the Maturity Date, and
(b) for any LIBOR Advance, the period beginning on the day such Advance is made
and ending one, two, three, six months or twelve months thereafter (as the
Borrower shall select).
"INTEREST RATE PROTECTION AGREEMENT" means an interest rate swap, cap,
collar or similar interest rate protection agreement between the Borrower or
any Subsidiary and other Person.
"INVESTMENT" means, in one or a series of related transactions, any
direct or indirect acquisition of all or substantially all assets of any
Person, or any direct or indirect purchase or other acquisition of, or
beneficial interest in, capital stock or other securities of any other
Person, or any direct or indirect loan, advance (other than advances to
employees for moving and travel expenses, drawing accounts and similar
expenditures in the ordinary course of business) or capital contribution or
transfer of property, assets or value to, or investment, in any other Person,
including without limitation the incurrence or sufferance of Debt or the
purchase
- 10 -
of accounts receivable of any other Person that are not current assets or do
not arise in the ordinary course of business.
"INVESTMENT POLICY" means that certain Amended and Restated La Quinta
Inns, Inc. Statement of Investment Policy as of October 1989 in effect on the
Agreement Date as specified on SCHEDULE 5 hereto.
"ISSUING BANK" means NationsBank of Texas, N.A. in its capacity as
issuer of the Letters of Credit.
"LENDER" means each financial institution shown on the signature pages
hereof so long as such financial institution maintains a Commitment or is owed
any part of the Obligations (including the Administrative Lender in its
individual capacity), and each Assignee that hereafter becomes party hereto
pursuant to Section 10.6 hereof.
"L/C CASH COLLATERAL ACCOUNT" has the meaning specified in Section
2.16(g) hereof.
"L/C RELATED DOCUMENTS" has the meaning specified in Section 2.16(e)
hereof.
"LETTERS OF CREDIT" means letters of credit under the Letter of Credit
Facility and letters of credit issued under the Existing Credit Agreement and
outstanding on the Agreement Date.
"LETTER OF CREDIT AGREEMENT" has the meaning specified in Section
2.16(b) hereof.
"LETTER OF CREDIT FACILITY" means the amount of Letters of Credit the
Issuing Bank may issue pursuant to Section 2.16(a) hereof.
"LEVERAGE RATIO" means, for any date of determination, the ratio of (i)
Total Debt as of the fiscal quarter immediately preceding the date of
determination to (ii) EBITDA, for the four consecutive fiscal quarters
preceding the date of determination. For purposes of calculation of EBITDA,
there shall be (i) included in EBITDA (without duplication) the EBITDA of any
assets acquired during any such four fiscal quarters and (ii) excluded from
EBITDA the EBITDA of any asset disposed during any such four fiscal quarters.
"LIBOR ADVANCE" means a Revolving Credit Advance which the Borrower
requests to be made as a LIBOR Advance or which is reborrowed as a LIBOR
Advance, in accordance with the provisions of Section 2.2 hereof.
"LIBOR BASIS" means, with respect to each LIBOR Advance for each
Interest Period, a rate per annum equal to the lesser of (a) the Highest Lawful
Rate or (b) the sum of the LIBOR Rate plus the Applicable Margin.
"LIBOR LENDING OFFICE" means, with respect to a Lender, the office
designated as its LIBOR Lending Office on SCHEDULE 1 attached hereto, and such
other office of the Lender or
- 11 -
any of its affiliates hereafter designated by notice to the Borrower and the
Administrative Lender.
"LIBOR RATE" means, for any Interest Period, the interest rate per annum
(rounded upward to the nearest one-sixteenth (1/16th) of one percent) at which
deposits in United States Dollars are offered to the Administrative Lender by
leading banks reasonably selected by the Administrative Lender in the London
interbank market at approximately 11:00 a.m. (London time), two Business Days
before the first day of such Interest Period, in an amount approximately equal
to the principal amount of, and for a length of time approximately equal to the
Interest Period for, the LIBOR Advance sought by the Borrower.
"LIEN" means, with respect to any property, any mortgage, lien, pledge,
collateral assignment, hypothecation, charge, security interest, title
retention agreement, levy, execution, seizure, attachment, garnishment or
other encumbrance of any kind in respect of such property, whether or not
xxxxxx, vested or perfected.
"LOAN PAPERS" means this Agreement, the Notes, the Guaranty Agreements,
the Fee Letter, and any other document or agreement executed or delivered from
time to time by the Borrower, any Subsidiary or any other Person in connection
herewith or as security for all or any part of the Obligations.
"LOAN PARTY" means the Borrower and each Guarantor.
"LONG TERM DEBT" means any obligation which is due one year or more from
the date of creation thereof which under GAAP is shown as a liability, plus
(without duplication) amounts equal to the aggregate net rentals (after making
allowances for any interest, taxes or other expenses included therein) payable
more than one year from the date of creation thereof under Capital Leases.
"MAINTENANCE CAPITAL EXPENDITURES" means, for any date of determination,
an amount equal to the product of (a) 5% multiplied by (b) room revenues (as
disclosed in the Borrower's Form 10-K and 10-Q) of the Borrower, its
Subsidiaries and Unincorporated Ventures, for the four consecutive fiscal
quarters preceding the date of determination.
"MASTER COVENANT AGREEMENT" means the Fifth Amended and Restated Master
Covenant Agreement dated as of the Agreement Date, by and between the Borrower
and NationsBank of Texas, N.A., as such agreement may be amended, restated,
supplemented or otherwise modified from time to time.
"MATERIAL ADVERSE CHANGE OR EFFECT" means any act or circumstance or
event which (a) is material and adverse to the combined or consolidated
financial condition of the Borrower, its Subsidiaries and Unincorporated
Ventures as represented in the Combined Financial Statements most recently
delivered to the Lenders at the time of any determination thereof or be
material and adverse to the combined or consolidated business operations or
properties of the Borrower,
- 12 -
its Subsidiaries and Unincorporated Ventures or (b) impairs the ability of
the Borrower, any Subsidiary or any other Person to perform in any material
respect their respective obligations under the Loan Papers.
"MATERIAL AMOUNT" means, as of the determination thereof, an amount
equal to the greater of (a) $1,000,000 or (b) the lesser of (i) $4,000,000 or
(ii) 1% of the consolidated revenues of the Borrower and its Subsidiaries
computed on a Combined basis for the fiscal year preceding the date of
determination.
"MATURITY DATE" means August 31, 2000, or the earlier date of
termination in whole of the Commitment pursuant to Section 2.6 or 7.2 hereof.
"MAXIMUM AMOUNT" means the maximum amount of interest which, under
Applicable Law, the Lenders are permitted to charge on the Obligations.
"MOODY'S" means Xxxxx'x Investors Service, Inc.
"MULTIEMPLOYER PLAN" means, as to any Person, at any time, a
"multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and to
which such Person or any member of its Controlled Group is making, or is
obligated to make contributions or has made, or been obligated to make,
contributions.
"NECESSARY AUTHORIZATION" means any right, franchise, license, permit,
consent, approval or authorization from, or any filing or registration with,
any governmental or other regulatory authority necessary or appropriate to
enable the Borrower or any Subsidiary or Unincorporated Venture to maintain
and operate its business and properties.
"NET CASH PROCEEDS" means the aggregate amount of cash received by the
Borrower in respect of the sale of Capital Stock of the Borrower, less the sum
of all fees, commissions and other expenses incurred in connection with such
sale.
"NET INCOME" means, with respect to any Person for any period, the net
income (loss) of such Person for such period, as determined in accordance with
GAAP.
"NET INTEREST EXPENSE" means, with respect to any Person for any period,
the sum of (i) Interest Expense of such Persons for such period minus (ii)
interest income of such Person for such period as reflected on an income
statement of such Person prepared in accordance with GAAP.
"NET WORTH" means an amount equal to the sum of the Capital Stock and
additional paid-in-capital plus retained earnings (or minus accumulated
deficit) of the Borrower and its Subsidiaries, less (i) treasury stock and
(ii) amounts attributable to the extent included, (1) to any write-up in book
value of assets resulting from a revaluation thereof subsequent to June 30,
1995, and (2) to Disqualified Capital Stock, all in accordance with GAAP.
- 13 -
"NON-FINANCIAL LETTER OF CREDIT" means any Letter of Credit issued under
the Letter of Credit Facility which is a "performance-based standby letter of
credit" as defined in Appendix A to 12 CFR Part 3 issued by the Office of the
Comptroller of the Currency.
"NOTE" means any Revolving Credit Note, Swing Line Note or Bid Rate Note
and "NOTES" means the Revolving Credit Notes, the Swing Line Notes and the Bid
Rate Notes.
"NOTICE OF ISSUANCE" means the meaning specified in Section 2.16(b)
hereof.
"OBLIGATIONS" means (a) all obligations of any nature (whether matured
or unmatured, fixed or contingent, including the Reimbursement Obligations)
of the Borrower, any Subsidiary or any other Person to the Lenders and the
Issuing Bank under the Loan Papers as they may be amended from time to time,
and (b) all obligations of the Borrower, any Subsidiary or any other Person
for losses, damages, expenses or any other liabilities of any kind that any
Lender may suffer by reason of a breach by the Borrower, any Subsidiary or
any other Person of any obligation, covenant or undertaking with respect to
any Loan Paper.
"OBLIGOR" means Borrower or each other Person liable for performance of
any of the Obligations or the property of which secures any of the Obligations.
"OPERATING INCOME" means, with respect to any Person for any period, the
operating income (loss) of such Person, as determined in accordance with GAAP.
"OPERATING LEASE" means any operating lease, as defined in the Financial
Accounting Standard Board Statement of Financial Accounting Standards No. 13,
dated November, 1976 or otherwise in accordance with GAAP.
"OTHER TAXES" has the meaning specified in Section 2.15 hereof.
"PARENT COMPANY" means, with respect to financial statements, the
uncombined, consolidated financial statements of the Borrower and its
Subsidiaries, including equity method investments, as defined by GAAP, in
Unincorporated Ventures and designated "La Quinta Inns, Inc. (Parent Company
and Wholly-Owned Subsidiaries)" on the Borrower's audit report.
"PARTICIPANT" has the meaning specified in Section 10.6(c) hereof.
"PARTICIPATION" has the meaning specified in Section 10.6(c) hereof.
"PARTNERS' CAPITAL" means the equity in the net assets of Unincorporated
Ventures of all the partners or venturers (other than the Borrower or a
Subsidiary) of such Unincorporated Ventures, or minority interest holders, as
determined in accordance with GAAP.
"PAYMENT DATE" means the last day of the Interest Period for any
Advance.
- 14 -
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"PERMITTED INVESTMENT" means Investments in (i) wholly-owned Domestic
Subsidiaries (a) that are subject to the provisions of this Agreement, (b)
that concurrently therewith unconditionally guarantee the performance of the
Borrower's obligations under this Agreement and (c) that concurrently deliver
to the Lenders (1) an opinion acceptable to the Lenders with respect to the
validity and enforceability of such guarantee and (2) such other documents,
such as corporate resolutions, certificates of incumbency, by-laws and
articles of incorporation, as the Lenders shall reasonably require, (ii)
Investments in any Person other than a wholly-owned Subsidiary in any one or
a series of related transactions with a fair market value not in excess of
$25,000,000 in the aggregate for all Investments in all such Persons, (iii)
Investments for the purpose of satisfying the Borrower's or any Subsidiary's
guarantee obligations with respect to the Debt of any Person in which the
Borrower or any Subsidiary owned any interest and which obligation was in
existence as of the Agreement Date; (iv) Investments in Subsidiaries and
Unincorporated Ventures which do not guarantee the performance of the
Borrower's obligations under this Agreement made in the ordinary course of
business, consistent with past practices for the purpose of providing for the
day to day operating requirements of such Subsidiary or Unincorporated
Venture, PROVIDED, that such Investments shall (a) not be used for
acquisition or conversion of any inns and (b) be evidenced by a note or other
evidence of indebtedness and (c) not at any time exceed $10,000,000 in
aggregate principal amount, (v) Investments permitted by Sections II.B.,
II.C. (provided that, notwithstanding Section II.C.3. of the Investment
Policy, banks shall be required to have at least $150,000,000 in capital and
surplus), II.E. and II.H. of the Investment Policy, (vi) loans or advances to
employees as compensation for services in the ordinary course of business not
in excess of $2,000,000 aggregate principal amount, (vii) Investments in the
ordinary course of business, consistent with past practice, in the Borrower's
National Advertising Fund, (viii) Existing Investments, (ix) Investments in
Capital Stock of Subsidiaries and Unincorporated Ventures listed on SCHEDULE
3 hereto for the purpose of acquiring no less than 100% of the capital stock
or partnership interests, as appropriate, of such Subsidiaries and
Unincorporated Ventures, (x) Investments in notes payable to the Borrower as
a result of the sale of inns in an aggregate principal amount not in excess
of $10,000,000, provided that the Borrower shall obtain and continue to hold
a perfected first Lien (subject to Permitted Liens) in such inns, and (xi)
Investments in wholly-owned Foreign Subsidiaries (a) that are subject to the
provisions of this Agreement and (b) not to exceed in aggregate amount
$1,000,000 for all Investments in all Foreign Subsidiaries. For purposes of
the calculation of the amount of any Investments permitted hereunder,
Investments will be calculated at all times at the amount of the original
Investment with no reduction for write-offs or write-downs. No Investment
which is a Permitted Investment other than pursuant to clause (ii) of the
definition of "PERMITTED INVESTMENTS" shall reduce the amount of Investments
permitted pursuant to such clause (ii).
"PERMITTED LIENS" means, as applied to any Person:
- 15 -
(i) any Lien in favor of the Administrative Lender or a trustee on its
behalf to secure the Obligations;
(ii) (a) Liens on real estate for real estate taxes not yet delinquent,
(b) Liens created by lease agreements to secure the payments of rental amounts
and other sums not yet due thereunder, (c) Liens on leasehold interests created
by the lessor in favor of any mortgagee of the leased premises, and (d) Liens
for taxes, assessments, governmental charges, levies or claims that are being
diligently contested in good faith by appropriate proceedings and for which
adequate reserves shall have been set aside on such Person's books, but only so
long as no foreclosure, restraint, sale or similar proceedings have been
commenced with respect thereto;
(iii) Liens of carriers, warehousemen, mechanics, laborers and materialmen
and other similar Liens incurred in the ordinary course of business for sums not
yet due or being contested in good faith, if such reserve or appropriate
provision, if any, as shall be required by GAAP shall have been made therefor;
(iv) Liens incurred in the ordinary course of business in connection with
worker's compensation, unemployment insurance or similar legislation;
(v) Easements, rights-of-way, restrictions and other similar
encumbrances on the use of real property which do not interfere with the
ordinary conduct of the business of such Person;
(vi) Liens created to secure the purchase price of fixed assets acquired
by such Person, which is incurred solely for the purpose of financing the
acquisition of such assets and incurred at the time of acquisition, so long as
(a) each such Lien shall at all times be confined solely to the asset or assets
so acquired (and proceeds thereof), (b) the Liens were placed on such assets at
the time such assets were acquired and (c) the aggregate principal amount of
Debt secured by such Liens does not exceed, together with the principal amount
of Debt secured by Liens permitted pursuant to clause (vii) below, $25,000,000,
and refinancings thereof so long as any such Lien remains solely on the asset or
assets acquired and the amount of Debt related thereto is not increased;
(vii) Liens existing on any property acquired by such Person prior to the
acquisition of such property by such Person, provided (a) such Lien shall at all
times be confined solely to the property so acquired (and proceeds thereof) and
(b) the aggregate principal amount of Debt secured by such Liens does not
exceed, together with the principal amount of Debt secured by Liens permitted
pursuant to clause (vi) above, $25,000,000 and refinancings thereof so long as
any such Lien remains solely on the asset or assets acquired and the amount of
Debt related thereto is not increased;
(viii)Liens in respect of judgments or awards for which appeals or
proceedings for review are being prosecuted and in respect of which a stay of
execution upon any such appeal or proceeding for review shall have been secured,
provided that (a) such Person shall have established adequate reserves for such
judgments or awards, (b) such judgments or awards shall
- 16 -
be fully insured and the insurer shall not have denied coverage, or (c) such
judgments or awards shall have been bonded to the satisfaction of the Lenders;
(ix) Any Liens existing on the Agreement Date which are described on
SCHEDULE 12 hereto, and Liens resulting from the refinancing of the related
Debt, provided that the Debt secured thereby shall not be increased and the
Liens shall not cover additional assets of the Borrower;
(x) any obligations or duties, affecting any property, to any
municipality or public authority with respect to any franchise, grant, license
or permit which do not materially impair the use of any material property for
the purposes for which such property is held by such Person;
(xi) zoning laws or ordinances and municipal regulations which do not
materially impair the use of any material property for the purposes for which
such property is held by such Person;
(xii) Liens, minor irregularities in or deficiencies of title on any
property which do not materially impair the use of any material property for the
purposes for which such property is held by such Person; and
(xiii)Liens otherwise permitted or contemplated by the Loan Papers.
"PERSON" means and includes an individual, corporation, partnership,
trust or unincorporated organization, or a government or any agency or political
subdivision thereof.
"PLAN" means an employee benefit plan as defined in Section 3(3) of
ERISA (including a Multiemployer Plan that is covered by Title IV of ERISA)
pursuant to which any employees of the Borrower, its Subsidiaries,
Unincorporated Ventures or any member of their Controlled Group participate;
PROVIDED, HOWEVER, "Plan" shall not include those agreements with former
employees of any of such Persons described on SCHEDULE 7 hereto, the
obligations pursuant to which do not exceed $450,000 in aggregate amount.
"PRIME RATE" means, at any time, the prime interest rate announced or
published by the Administrative Lender from time to time as its reference rate
for the determination of interest rates for loans of varying maturities in
United States dollars to United States residents of varying degrees of
creditworthiness and being quoted at such time by the Administrative Lender as
its "prime rate;" it being understood that such rate may not be the lowest rate
of interest charged by the Administrative Lender.
"QUALIFIED CAPITAL STOCK" means any Capital Stock of the Borrower that
is not Disqualified Capital Stock.
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"QUARTERLY DATE" means the last Business Day of each February, May,
August and November, beginning November 30, 1995.
"REIMBURSEMENT OBLIGATIONS" means, in respect of any Letter of Credit as
at any date of determination, the sum of (a) the maximum aggregate amount which
is then available to be drawn under such Letter of Credit plus (b) the aggregate
amount of all drawings under such Letter of Credit and not theretofore
reimbursed by the Borrower.
"REFINANCING ADVANCE" means any Revolving Credit Advance which is used
to pay the principal amount (or any portion thereof) of a Revolving Credit
Advance at the end of its Interest Period and which, after giving effect to such
application, does not result in an increase in the aggregate amount of
outstanding Revolving Credit Advances.
"REGULATORY MODIFICATION RETROACTIVE EFFECTIVE DATE" has the meaning
specified in Section 8.5 hereof.
"REGULATORY MODIFICATION SET DATE" has the meaning specified in Section
8.5 hereof.
"RELEASE DATE" means the date on which the Notes have been paid, all
other Obligations due and owing have been paid and performed in full, and the
Commitment has been terminated.
"REPORTABLE EVENT" has the meaning specified in Section 4043(b) of
ERISA.
"REVOLVING CREDIT ADVANCE" means an Advance made pursuant to Section
2.1(a) hereof.
"REVOLVING CREDIT NOTE" means any Promissory Note of the Borrower
evidencing Revolving Credit Advances hereunder, substantially in the form of
EXHIBIT A hereto, together with any extension, renewal or amendment thereof or
substitution therefor.
"RIGHTS" means rights, remedies, powers and privileges.
"S&P" means Standard & Poor's Ratings Group, a Division of XxXxxx-Xxxx,
Inc., a New York corporation.
"S.E.C." means the United States Securities and Exchange Commission.
"SENIOR DEBT" means Total Debt of the Borrower, its Subsidiaries and
Unincorporated Ventures, as appropriate, other than Subordinated Debt.
"SENIOR NOTES" means the Borrower's $100,000,000 senior unsecured notes
due 2005.
"SENIOR SUBORDINATED NOTES" means the Borrower's $120,000,000 9-1/4%
Senior Subordinated Notes due May 15, 2003 issued pursuant to the Senior
Subordinated Note Indenture.
- 18 -
"SENIOR SUBORDINATED NOTE INDENTURE" means the Indenture pursuant to
which the Senior Subordinated Notes may be issued, as the same may be amended,
supplemented or otherwise modified.
"SIGNIFICANT INVESTMENTS" means those investments of the Borrower in the
joint ventures or partnerships set forth on SCHEDULE 10 hereto.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary of the Borrower (a) the
revenues attributable to which for the then most recently completed four fiscal
quarters constituted (or, with respect to Subsidiaries acquired during such four
fiscal quarters, would have constituted had the revenues of such Subsidiary been
included for such period) 2.5% or more of the consolidated revenues of the
Borrower and its Subsidiaries for such period, or (b) the assets of which as of
the end of such period constituted 2.5% or more of the consolidated assets of
the Borrower and its Subsidiaries as of the end of such period.
"SOLVENT" means, with respect to any Person, that the fair value of the
assets of such Person (both at fair valuation and at present fair saleable
value) is, on the date of determination, greater than the total amount of
liabilities (including contingent and unliquidated liabilities) of such Person
as of such date and that, as of such date, such Person is able to pay all
liabilities of such Person as such liabilities mature and such Person does not
have unreasonably small capital with which to carry on its business. In
computing the amount of contingent or unliquidated liabilities at any time, such
liabilities will be computed at the amount which, in 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 discounted to present value
at rates believed to be reasonable by such Person.
"SPECIAL COUNSEL" means the law firm of Xxxxxxx, Xxxxxxx & Xxxxxxx,
P.C., or such other legal counsel as the Administrative Lender may select.
"SPECIFIED PERCENTAGE" means, as to any Lender, the percentage indicated
beside its name on the signature pages hereof, or if applicable, specified in
its most recent Assignment Agreement.
"SUBSIDIARY" with respect to any Persons, means (a) a corporation at
least a majority of whose Capital Stock with voting power, under ordinary
circumstances, to elect directors is at the time, directly or indirectly, owned
by such Person, by such Person and one or more Subsidiaries of such Person or by
one or more Subsidiaries of such Person or (b) a partnership, joint venture or
similar entity in which 100% of the ownership, capital, interest or profits is
at the time, directly or indirectly, owned by such Person, by such Person and
one or more Subsidiaries of such Person or by one or more Subsidiaries of such
Person.
"SUBSIDIARY GUARANTY" means the Guaranty executed by each Significant
Subsidiary guaranteeing payment and performance of the Obligations,
substantially in the form of EXHIBIT D
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hereto, as such agreement may be amended, modified, supplemented or restated
from time to time.
"SUBORDINATED DEBT" means any debt, obligation or liability (whether
primary, contingent or otherwise) of the Borrower, a Subsidiary or an
Unincorporated Venture which by its terms is subordinate in right of payment to
the Obligations, provided that the Banks approve the terms thereof prior to or
at the time of the issuance thereof.
"SWING LINE ADVANCE" means an Advance made pursuant to Section 2.1(b)
hereof.
"SWING LINE BANK" means NationsBank of Texas, N.A. and any successor
thereto appointed in accordance with Section 9.1(b) hereof.
"SWING LINE FACILITY" has the meaning specified in Section 2.1(b)
hereof.
"SWING LINE NOTE" means the Swing Line Note of the Borrower payable to
the order of the Swing Line Bank, substantially in the form of EXHIBIT C
hereto, together with any extension, renewal or amendment thereof or
substitution therefor.
"TAXES" has the meaning specified in Section 2.15 hereof.
"TOTAL DEBT" means, as of any date of determination, the sum (without
duplication) of (a) all Debt of the Borrower and its Subsidiaries, minus (b)(i)
the aggregate face amount of Bond Letters of Credit outstanding and (ii) all
Debt of the Borrower and its Subsidiaries of the type described in (a) clauses
(f) and (g) of the definition of "DEBT" herein which are set forth on
SCHEDULE 11 hereto and (b) clauses (h) and (k) of the definition of "DEBT"
herein.
"TRIBUNAL" means any state, commonwealth, federal, foreign territorial,
or other court or governmental department, commission, board, bureau, agency or
instrumentality.
"UCC" means the Uniform Commercial Code of Texas, as amended from time
to time.
"UNINCORPORATED VENTURES" means those Persons designated as
"Unincorporated Ventures" on SCHEDULE 3 hereto.
Section 1.2 AMENDMENTS AND RENEWALS. Each definition of an agreement in
this Article 1 shall include such agreement as amended to date, and as amended
or renewed from time to time in accordance with its terms, but only with the
prior written consent of the Determining Lenders.
Section 1.3 CONSTRUCTION. The terms defined in this Article 1 (except
as otherwise expressly provided in this Agreement) for all purposes shall have
the meanings set forth in Section 1.1 hereof, and the singular shall include the
plural, and vice versa, unless otherwise specifically required by the context.
All accounting terms used in this Agreement which are not
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otherwise defined herein shall be construed in accordance with GAAP on a
consolidated basis for the Borrower and its Subsidiaries, unless otherwise
expressly stated herein.
ARTICLE 2
ADVANCES
Section 2.1 THE ADVANCES.
(a) REVOLVING CREDIT ADVANCES. Each Lender severally agrees, upon the
terms and subject to the conditions of this Agreement, to make Revolving Credit
Advances to the Borrower from time to time up to and including the Maturity Date
in an aggregate amount not to exceed an amount equal to (i) its Specified
Percentage of the Commitment less (ii) an amount equal to its Specified
Percentage of the aggregate amount of all Reimbursement Obligations then
outstanding (assuming compliance with all conditions to drawing) for the
purposes set forth in Section 5.21 hereof. Notwithstanding the immediately
preceding sentence, at no time shall the sum of (i) the aggregate principal
amount of Revolving Credit Advances outstanding, plus (ii) the aggregate
principal amount of Swing Line Advances outstanding, plus (iii) the aggregate
principal amount of all Reimbursement Obligations, plus (iv) the aggregate
principal amount of Bid Rate Advances exceed the Commitment. Subject to Section
2.9 hereof, Revolving Credit Advances may be repaid and then reborrowed. Any
Revolving Credit Advance shall, at the option of the Borrower as provided in
Section 2.2 hereof (and, in the case of LIBOR Advances, subject to availability
and to the provisions of Article 8 hereof), be made as a Base Rate Advance or a
LIBOR Advance; provided that there shall not be outstanding to any Lender, at
any one time, more than six LIBOR Advances. On the Maturity Date unless sooner
paid as provided herein, the outstanding Revolving Credit Advances shall be
repaid in full.
(b) THE SWING LINE LOANS. The Borrower may request Swing Line Bank to
make, and Swing Line Bank may, if in its sole discretion it elects to do so,
make, on the terms and conditions hereinafter set forth, loans ("Swing Line
Loans") to Borrower from time to time on any Business Day during the period from
the date hereof until the Maturity Date in an aggregate amount not to exceed at
any time outstanding the lesser of (i) $10,000,000 and (ii) the sum of (a) the
Commitment, MINUS (b) the aggregate principal amount of Revolving Credit
Advances then outstanding MINUS (c) the aggregate principal amount of all
Reimbursement Obligations then outstanding (assuming compliance with all
conditions to drawing) (the "Swing Line Facility") minus (d) the aggregate
principal amount of all Bid Rate Advances then outstanding. Each Swing Line
Advance shall be in an amount not less than $50,000. Within the limits of the
Swing Line Facility, so long as the Swing Line Bank, in its sole discretion,
elects to make Swing Line Advances, Swing Line Advances may be repaid and then
reborrowed.
(c) BID RATE ADVANCES. Each Lender may, in its sole discretion and on
the terms and conditions set forth in this Agreement and such other agreements
that such Lender may enter into with the Borrower, make Bid Rate Advances to the
Borrower from time to time in an
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aggregate amount not in excess of the difference between (i) the Commitment
minus (ii) the sum of (a) the aggregate outstanding principal amount of all
Revolving Credit Advances, plus (b) the aggregate outstanding principal amount
of all Bid Rate Advances, plus (c) the amount of all Reimbursement Obligations
plus (d) the aggregate outstanding principal amount of all Swing Line Advances.
Each Bid Rate Advance shall be for a period of not less than 7 days and not more
than 90 days. The Lenders shall have no obligation hereunder to offer any Bid
Rate Advances and the Borrower may not request any Bid Rate Advances unless the
Index Debt Rating is any two of the following or better: BBB- by S&P, BBB- by
ARA or Baa3 by Xxxxx'x. Bid Rate Advances may not be prepaid without the prior
written consent of the Lender making such Bid Rate Advance.
Section 2.2 MANNER OF BORROWING AND DISBURSEMENT.
(a) In the case of Base Rate Advances other than a Refinancing Advance,
the Borrower, through an Authorized Signatory, shall give the Administrative
Lender prior to 10:30 a.m., Dallas, Texas time, on the date of any proposed Base
Rate Advance irrevocable written notice, or irrevocable telephonic notice
followed immediately by written notice (provided, however, that the Borrower's
failure to confirm any telephonic notice in writing shall not invalidate any
notice so given), of its intention to borrow or reborrow a Base Rate Advance
hereunder. Such notice of borrowing shall specify the requested funding date,
which shall be a Business Day, and the amount of the proposed aggregate Base
Rate Advances to be made by Lenders. Each Base Rate Advance shall have an
Interest Period beginning on the date such Advance is made and ending on the
Quarterly Date next following the date the Advance is made; provided that no
such Interest Period shall extend past the Maturity Date.
(b) In the case of LIBOR Advances, the Borrower, through an Authorized
Signatory, shall give the Administrative Lender at least three Business Days'
irrevocable written notice for LIBOR Advances, or irrevocable telephonic notice
followed immediately by written notice (provided, however, that the Borrower's
failure to confirm any telephonic notice in writing shall not invalidate any
notice so given), of its intention to borrow or reborrow a LIBOR Advance
hereunder. Notice shall be given to the Administrative Lender prior to 11:00
a.m., Dallas, Texas time, in order for such Business Day to count toward the
minimum number of Business Days required. LIBOR Advances shall in all cases be
subject to availability and to Article 8 hereof. For LIBOR Advances, the notice
of borrowing shall specify the requested funding date, which shall be a Business
Day, the amount of the proposed aggregate LIBOR Advances, to be made by Lenders
and the Interest Period selected by the Borrower, provided that no such Interest
Period shall extend past the Maturity Date.
(c) In the case of Swing Line Advances, the Borrower, through an
Authorized Signatory, shall give the Swing Line Bank and the Administrative
Lender prior to 12:00 noon, Dallas, Texas time, on the date of any proposed
Swing Line Advance irrevocable written notice or irrevocable telephonic notice
followed immediately by written notice (provided, however, that the Borrower's
failure to confirm any telephonic notice in writing shall not invalidate any
notice so given), of its intention to borrow or reborrow a Swing Line Advance.
Such notice of
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borrowing shall specify the requested funding date, which shall be a Business
Day, and the amount of the proposed Swing Line Advance.
(d) Subject to Sections 2.1 and 2.9 hereof, at least three Business Days
prior to each Payment Date for a LIBOR Advance, the Borrower, through an
Authorized Signatory, shall give the Administrative Lender irrevocable written
notice, or irrevocable telephonic notice followed immediately by written notice
(provided, however, that the Borrower's failure to confirm any telephonic notice
in writing shall not invalidate any notice so given), specifying whether all or
a portion of such LIBOR Advance outstanding on the Payment Date (i) is to be
repaid and then reborrowed in whole or in part as a Base Rate Advance or a LIBOR
Advance, or (ii) is to be repaid and not reborrowed; provided, however,
notwithstanding anything in this Agreement to the contrary, if on any Payment
Date a Default shall exist, such LIBOR Advance may only be reborrowed as a Base
Rate Advance. Upon such Payment Date, such LIBOR Advance shall, subject to the
provisions hereof, be so repaid and, as applicable, reborrowed.
(e) Subject to Sections 2.1 and 2.9 hereof, upon irrevocable written
notice to the Administrative Lender prior to 11:00 a.m., Dallas, Texas, time on
each Payment Date (or three Business Days if the Borrower wishes to reborrow a
LIBOR Advance, through an Authorized Signatory, or irrevocable telephonic notice
followed immediately by written notice (provided, however, that the Borrower's
failure to confirm any telephonic notice in writing shall not invalidate any
notice so given), the Borrower may repay a Base Rate Advance on its Payment
Date, and (i) reborrow all or a portion of the principal amount thereof as a
Base Rate Advance, (ii) reborrow all or a portion of the principal amount
thereof as one or more LIBOR Advances, or (iii) not reborrow all or any portion
of such Base Rate Advance. Upon such Payment Date or date of repayment, such
Base Rate Advance shall, subject to the provisions hereof, be so repaid and, as
applicable, reborrowed.
(f) The aggregate amount of Base Rate Advances to be made by the Lenders
on any day shall be in a principal amount which is at least $1,000,000 and which
is an integral multiple of $100,000; provided, however, that such amount may
equal the unused amount of the Commitment. The aggregate amount of LIBOR
Advances having the same Interest Period and to be made by the Lenders on any
day shall be in a principal amount which is at least $3,000,000 and which is an
integral multiple of $500,000.
(g) The Administrative Lender shall promptly notify the Lenders of each
notice (other than with respect to a Swing Line Advance or a Bid Rate Advance)
received from the Borrower pursuant to this Section. Failure of the Borrower to
give any notice in accordance with Sections 2.2(d) and (e) hereof shall result
in a repayment of any such existing Advance on the applicable Payment Date by a
Refinancing Advance which is a Base Rate Advance. Each Lender shall, not later
than 1:00 p.m., Dallas, Texas time, on the date of any Revolving Credit Advance
that is not a Refinancing Advance, deliver to the Administrative Lender, at its
address set forth herein, such Lender's Specified Percentage of such Revolving
Credit Advance in immediately available funds in accordance with the
Administrative Lender's instructions. Prior to 2:00 p.m., Dallas, Texas time,
on the date of any Revolving Credit Advance hereunder that
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is not a Refinancing Advance, the Administrative Lender shall, subject to
satisfaction of the conditions set forth in Article 3, disburse the amounts made
available to the Administrative Lender by the Lenders by (i) transferring such
amounts by wire transfer pursuant to the Borrower's instructions, or (ii) in the
absence of such instructions, crediting such amounts to the account of the
Borrower maintained with the Administrative Lender. All Revolving Credit
Advances shall be made by each Lender according to its Specified Percentage. No
Lender shall be relieved of its obligation to fund its Specified Percentage of
any Revolving Credit Advance notwithstanding the fact that at any time the
aggregate outstanding principal amount of all Bid Rate Advances made by such
Lender exceed its Specified Percentage of the Commitment.
(h) If, in its sole discretion, the Swing Line Bank elects to make the
requested Swing Line Advance, the Swing Line Bank shall, not later than 1:30
p.m., Dallas, Texas time, on the date of any Swing Line Advance, deliver to the
Administrative Lender at its address set forth herein, the amount of such Swing
Line Advance in immediately available funds in accordance with the
Administrative Lender's instructions. Prior to 2:00 p.m., Dallas, Texas time,
on the date of any Swing Line Advance, the Administrative Lender shall, subject
to the conditions set forth in Article 3, disburse the amount made available to
the Administrative Lender by the Swing Line Bank by (i) transferring such
amounts by wire transfer pursuant to the Borrower's instruction or (ii) in the
absence of such instructions, crediting such amounts to the account of the
Borrower maintained with the Administrative Lender. Forthwith upon demand by
the Swing Line Bank and in any event upon the making of the request or the
granting of the consent specified by Section 7.2 to authorize the Administrative
Lender to declare the Advances due and payable pursuant to the provisions of
Section 7.2, each Lender, including the Swing Line Bank, notwithstanding the
failure of the Borrower at such time to satisfy each condition specified in
Article 3, shall make by 12:00 noon (Dallas, Texas time) on the first Business
Day following receipt by such Lender of notice from the Swing Line Bank, a
Revolving Credit Advance which is a Base Rate Advance in an amount equal to the
product of (i) the Specified Percentage of such Lender times (ii) the aggregate
outstanding principal amount of the Swing Line Advances. The proceeds of such
Revolving Credit Advances shall be applied by the Administrative Lender to repay
the outstanding Swing Line Advance.
(i) BID RATE ADVANCES
(i) In the case of Bid Rate Advances, the Borrower, through an
Authorized Signatory, shall give the Administrative Lender (which shall
promptly notify the Lenders) prior to 11:00 a.m., Dallas, Texas time, at
least one Business Day prior to the proposed borrowing, irrevocable
written notice of its intention to borrow a Bid Rate Advance. Such notice
of borrowing shall specify (i) the requested funding date, which shall be
a Business Day, (ii) the aggregate amount of the proposed Bid Rate
Advances, (ii) the Interest Period selected by the Borrower, provided that
no Interest Period shall extend past the Maturity Date and (iv) any other
terms applicable thereto.
(ii) Each Lender shall, if, in its sole discretion, it elects to do
so, irrevocably offer to make one or more Bid Rate Advances to the
Borrower as part of such proposed
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borrowing at a rate or rates of interest specified by such Lender in its
sole discretion, by making a written quote to the Administrative Lender
(which shall give prompt notice thereof to the Borrower) before 9:30 a.m.,
Dallas, Texas time, on the date of such proposed borrowing, setting forth
the minimum amount and maximum amount of each Bid Rate Advance which such
Lender would be willing to make as part of the proposed borrowing (which
amounts may exceed such Lender's Specified Percentage of the Commitment)
and the rate or rates of interest therefor. If NationsBank of Texas, N.A.
elects to offer to make one or more Bid Rate Advances, it shall deliver
its written quote with respect to the proposed borrowing to the Borrower
prior to the Administrative Lender's receipt of any other Lender's written
quote for such proposed borrowing. The Administrative Lender shall notify
the Borrower of each written quote provided by each Lender with respect to
the proposed borrowing before 10:00 a.m., Dallas, Texas, on the date of
such proposed borrowing. If any Lender shall elect not to make such an
offer, such Lender shall so notify the Administrative Lender before 9:30
a.m., Dallas, Texas time, on the date of such proposed borrowing, and such
Lender shall not make any Bid Rate Advance as part of such borrowing. If
any Lender shall fail to respond to the Administrative Lender by such
time, such Lender shall be deemed to have elected not to make an offer.
(iii) The Borrower shall, in turn, before 10:30 a.m., Dallas, Texas
time, on the date of such proposed borrowing either
(A) cancel such proposed borrowing by giving the
Administrative Lender notice to that effect, or
(B) accept one or more of the offers made by any Lender or
Lenders pursuant to clause (ii) above, in its sole discretion, by
giving notice to the Administrative Lender of the amount of each Bid
Rate Advance (which amount shall be equal to or greater than the
minimum amount, and equal to or less than the maximum amount, for
which notification was given to the Borrower by the Administrative
Lender on behalf of such Lender for such Bid Rate Advance pursuant
to clause (ii) above) to be made by each Lender as part of such
borrowing, and reject any remaining offers made by the Lenders
pursuant to clause (ii) above by giving the Administrative Lender
notice to that effect.
(iv) If the Borrower notifies the Administrative Lender that such
proposed borrowing is cancelled pursuant to clause (iii)(a) above, the
Administrative Lender shall give prompt notice thereof to the Lenders and
such borrowing shall not be made.
(v) If the Borrower accepts one or more of the offers made by any
Lender or Lenders pursuant to clause (iii)(b) above, the Administrative
Lender shall in turn promptly notify each Lender of the date, rate of
interest, and amount of each Bid Rate Advance and the Lender making such
Advance.
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Section 2.3 INTEREST.
(a) ON BASE RATE ADVANCES.
(i) The Borrower shall pay interest on the outstanding unpaid
principal amount of each Base Rate Advance, from the date such Advance is
made until it is due (whether at maturity, by reason of acceleration, by
scheduled reduction, or otherwise) or repaid, which shall be payable as
set forth in Section 2.3(a)(ii) hereof, at a simple interest rate per
annum equal to the Base Rate Basis for such Base Rate Advance as in effect
from time to time, provided that interest on such Base Rate Advance shall
not exceed the Maximum Amount. If at any time the Base Rate Basis would
exceed the Highest Lawful Rate, interest payable on such Base Rate Advance
shall be limited to the Highest Lawful Rate, but the Base Rate Basis shall
not thereafter be reduced below the Highest Lawful Rate until the total
amount of interest accrued on such Advance equals the amount of interest
that would have accrued if the Base Rate Basis had been in effect at all
times.
(ii) Interest on each Base Rate Advance shall be computed on the
basis of a year of 365 or 366 days, as applicable, for the number of days
actually elapsed, and shall be payable in arrears on each Quarterly Date
and on the Maturity Date.
(b) ON LIBOR ADVANCES.
(i) The Borrower shall pay interest on the unpaid principal amount
of each LIBOR Advance, from the date such Advance is made until it is due
(whether at maturity, by reason of acceleration, by scheduled reduction,
or otherwise) or repaid, at a rate per annum equal to the LIBOR Basis for
such Advance. The Administrative Lender, whose determination shall be
conclusive, shall determine the LIBOR Basis on the second Business Day
prior to the applicable funding date and shall notify the Borrower and the
Lenders of such LIBOR Basis.
(ii) Subject to Section 10.9 hereof, interest on each LIBOR Advance
shall be computed on the basis of a 360-day year for the actual number of
days elapsed, and shall be payable in arrears on the applicable Payment
Date and on the Maturity Date; provided, however, that if the Interest
Period for such Advance exceeds three months, interest shall also be due
and payable in arrears on each Quarterly Date during such Interest Period.
(c) ON SWING LINE ADVANCES.
(i) The Borrower shall pay interest on the outstanding principal
amount of such Swing Line Advance, from the date such Swing Line Advance
is made until it is due (whether at maturity, by reason of acceleration or
otherwise) or repaid, which shall be payable as set forth in Section
2.3(c)(ii) hereof, equal to the Prime Rate in effect from time to time
minus 1/2%, but not higher than the Highest Lawful Rate.
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(ii) Interest on each Swing Line Advance shall be computed on the
basis of a year of 365 or 366 days, as applicable, for the number of days
actually elapsed, and shall be payable in arrears on each Quarterly Date
and on the Maturity Date.
(d) ON BID RATE ADVANCES. The Borrower shall pay interest on the
outstanding unpaid principal amount of each Bid Rate Advance at a per annum rate
equal to the interest rate agreed to by the Borrower and the Lender making such
Bid Rate Advance pursuant to Section 2.2(i) hereof. Interest on each Bid Rate
Advance shall be computed and shall be payable at such times as agreed upon
between the Borrower and the Lender making such Advance pursuant to Section
2.2(i) hereof.
(e) INTEREST IF NO NOTICE OF SELECTION OF INTEREST RATE BASIS. If the
Borrower fails to give the Administrative Lender timely notice of its selection
of a LIBOR Basis or an Interest Period for a LIBOR Advance, or if for any reason
a determination of a LIBOR Basis for any Advance is not timely concluded due to
the fault of the Borrower, the appropriate Base Rate Basis shall apply to such
Advance.
(f) INTEREST AFTER AN EVENT OF DEFAULT. (i) After an Event of Default
(other than an Event of Default specified in Section 7.1(f) hereof) and during
any continuance thereof, at the option of Determining Lenders, and (ii) after an
Event of Default specified in Section 7.1(f) hereof and during any continuance
thereof, automatically and without any action by the Administrative Lender or
any Lender, the Obligations shall bear interest at a rate per annum equal to the
Default Rate. Such interest shall be payable on the earlier of demand or the
Maturity Date, and shall accrue until the earlier of (i) waiver or cure (to the
satisfaction of the Determining Lenders) of the applicable Event of Default,
(ii) agreement by the Lenders to rescind the charging of interest at the Default
Rate, or (iii) payment in full of the Obligations. The Lenders shall not be
required to accelerate the maturity of the Advances, to exercise any other
rights or remedies under the Loan Papers, or to give notice to the Borrower of
the decision to charge interest at the Default Rate. The Lenders will undertake
to notify the Borrower, after the effective date, of the decision to charge
interest at the Default Rate.
Section 2.4 FEES.
(a) FACILITY FEE. Subject to Section 10.9 hereof, the Borrower agrees
to pay to the Administrative Lender, for the ratable account of the Lenders, a
facility fee on the daily average amount of the Commitment at the following per
annum percentages, applicable in the following situations:
APPLICABILITY PERCENTAGE
------------- ----------
CATEGORY 1 - The Leverage Ratio is not less than 3.50
to 1 or the Index Debt Rating is any two of the
following: BB by S&P, BB by ARA or Ba2 by Xxxxx'x 0.30
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CATEGORY 2 - The Leverage Ratio is less than 3.50 to 1
but not less than 3.0 to 1 or the Index Debt Rating is
any two of the following: BB+ by S&P, BB+ by ARA or
Ba1 by Xxxxx'x 0.25
CATEGORY 3 - The Leverage Ratio is less than 3.00 to 1
but not less than 2.0 to 1 or the Index Debt Rating is
any two of the following: BBB- or better by S&P, BBB-
or better by ARA or Baa3 or better by Xxxxx'x 0.20
CATEGORY 4 - The Leverage Ratio is less than 2.00 to 1
or the Index Debt Rating is any two of the following:
BBB+ or better by S&P, BBB+ or better by ARA or Baa1 or
better by Xxxxx'x 0.15
Such fee shall accrue from the date of the initial Advance and shall be payable
(i) in arrears on each Quarterly Date and on the Maturity Date, fully earned
when due and, subject to Section 10.9 hereof, nonrefundable when paid and (ii)
computed on the basis of a year of 365 or 366 days, as applicable, for the
actual number of days elapsed. (a) If the Index Debt Rating and the Leverage
Ratio are in different categories, the facility fee shall be determined on
whichever of the Index Debt Rating or the Leverage Ratio falls within the
superior (or numerically higher) category, (b) if the facility fee is determined
based on the Leverage Ratio and the financial statements of the Borrower setting
the Leverage Ratio are not received by the Administrative Lender by the date
required pursuant to Section 6.1(a) or 6.1(b) hereof, the facility fee shall be
determined as if the Leverage Ratio is not less than 3.50 to 1 until such time
as the financial statements are received, (c) if the Index Debt Rating
established by ARA shall fall within a different category than both Xxxxx'x and
S&P, the facility fee shall be determined by reference to Xxxxx'x or S&P,
whichever shall be the superior (or numerically higher) category, but not to
exceed two rating levels higher than the other rating agency and (e) such fee
shall be adjusted on each Adjustment Date if determined based on the (i)
Leverage Ratio, according to the performance of the Borrower for the most recent
fiscal quarter or (ii) the Index Debt Rating, according to the most recent
determination of the Index Debt Rating. If the rating system of Xxxxx'x, S&P or
ARA shall change prior to the Maturity Date, the Borrower and the Lenders shall
negotiate in good faith to amend the references to specific ratings to reflect
such changed rating system.
(b) CLOSING FEE. Subject to Section 10.9 hereof, the Borrower agrees
to pay to the Administrative Lender, for the account of the Lenders a closing
fee equal to 0.10% of each Lender's portion of the Commitment. Such fee shall
be payable on the date of the initial Advance, fully earned when due and,
subject to Section 10.9 hereof, nonrefundable when paid.
(c) OTHER FEES. Subject to Section 10.9 hereof, the Borrower agrees
to pay to the Administrative Lender, for its account and not the account of the
Lenders, the fees provided for in the letter agreement ("Fee Letter"), dated as
of the Agreement Date, between the Borrower and the Administrative Lender on the
date and in the amounts specified therein.
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Section 2.5 PREPAYMENT.
(a) VOLUNTARY PREPAYMENTS. The principal amount of any Base Rate
Advance may be prepaid in full or in part at any time, without penalty and
without regard to the Payment Date for such Advance, upon notice as required for
a repayment of a Base Rate Advance as provided in Section 2.2(e) hereof. LIBOR
Advances may be voluntarily prepaid upon notice as required for repayments of
LIBOR Advances as provided in Section 2.2(d) hereof, but only so long as the
Borrower concurrently reimburses the Lenders in accordance with Section 2.9
hereof. The principal amount of any Swing Line Advance may be prepaid in full
or in part at any time, without penalty and without regard to the Payment Date
for such Advance. Any notice of prepayment shall be irrevocable.
(b) MANDATORY PREPAYMENT. On or before the date of any reduction of
the Commitment, the Borrower shall prepay outstanding Advances in an amount
necessary to reduce the same to an amount less than or equal to the Commitment
as so reduced. The Borrower shall first prepay all Base Rate Advances, second
prepay all Swing Line Advances and shall thereafter prepay LIBOR Advances. To
the extent that any prepayment requires that a LIBOR Advance be repaid on a date
other than the last day of its Interest Period, the Borrower shall reimburse
each Lender in accordance with Section 2.9 hereof. To the extent that
outstanding Advances and Reimbursement Obligations exceed the Commitment after
any reduction thereof, the Borrower shall repay any such excess amount and all
accrued interest thereon on the date of such reduction.
(c) PREPAYMENTS, GENERALLY. Any prepayment of an Advance shall be
accompanied by interest accrued on the principal amount being prepaid. Any
voluntary partial prepayment of a Base Rate Advance shall be in a principal
amount of $100,000 or an integral multiple thereof. Any voluntary partial
prepayment of a Swing Line Advance shall be in a principal amount of $50,000 or
an integral multiple thereof. All voluntary prepayments shall be applied in the
order directed in writing by the Borrower to the Administrative Lender. If the
Borrower fails to so direct the Administrative Lender or if the prepayment
occurs during the occurrence and continuance of an Event of Default, such
prepayment shall be applied in the inverse order of maturity.
Section 2.6 REDUCTION OF COMMITMENT.
(a) VOLUNTARY REDUCTION. The Borrower shall have the right, upon not
less than 10 Business Days' notice (provided no notice shall be required for a
termination in whole of the Commitment) by an Authorized Signatory to the
Administrative Lender (if telephonic, to be confirmed by telex or in writing on
or before the date of reduction or termination), which shall promptly notify the
Lenders, to terminate or reduce the Commitment, in whole or in part. Each
partial termination shall be in an aggregate amount which is at least $1,000,000
and which is an integral multiple of $100,000, and no voluntary reduction in the
Commitment shall cause any LIBOR Advance to be repaid prior to the last day of
its Interest Period.
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(b) MANDATORY REDUCTION. On the Maturity Date, the Commitment shall
automatically reduce to zero.
(c) GENERAL REQUIREMENTS. Upon any reduction of the Commitment
pursuant to this Section, the Borrower shall immediately make a repayment of
applicable Advances in accordance with Section 2.5(b) hereof. The Borrower
shall reimburse each Lender for any loss or out-of-pocket expense incurred by
each Lender in connection with any such payment, as set forth in Section 2.9
hereof to the extent applicable. The Borrower shall not have any right to
rescind any termination or reduction. Once reduced, the Commitment may not be
increased or reinstated.
Section 2.7 NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE LENDER. Unless
the Administrative Lender shall have been notified by a Lender prior to the date
of any proposed Revolving Credit Advance (which notice shall be effective upon
receipt) that such Lender does not intend to make the proceeds of such Revolving
Credit Advance available to the Administrative Lender, the Administrative Lender
may assume that such Lender has made such proceeds available to the
Administrative Lender on such date, and the Administrative Lender may in
reliance upon such assumption (but shall not be required to) make available to
the Borrower a corresponding amount. If such corresponding amount is not in
fact made available to the Administrative Lender by such Lender, the
Administrative Lender shall, without prejudice to the Borrower's rights against
such Lender, be entitled to recover such amount on demand from such Lender (or,
if such Lender fails to pay such amount forthwith upon such demand, from the
Borrower) together with interest thereon in respect of each day during the
period commencing on the date such amount was available to the Borrower and
ending on (but excluding) the date the Administrative Lender receives such
amount from the Lender, at a per annum rate equal to the lesser of (i) the
Highest Lawful Rate or (ii)(a) in the case of such Lender, the Federal Funds
Rate or (b) in the case of the Borrower, the interest rate applicable to such
Revolving Credit Advance. No Lender shall be liable for any other Lender's
failure to fund a Revolving Credit Advance hereunder.
Section 2.8 PAYMENT OF PRINCIPAL OF ADVANCES. The Borrower agrees to
pay the principal amount of the Advances to the Administrative Lender for the
account of the Lenders as follows:
(a) END OF INTEREST PERIOD. The principal amount of each Advance
hereunder shall be due and payable on its Payment Date, which principal payment
(other than in respect of a Bid Rate Advance) may be made by means of a
Refinancing Advance.
(b) COMMITMENT REDUCTION. On the date of reduction of the Commitment
pursuant to Section 2.6 hereof, including the Maturity Date, the aggregate
amount of the Advances outstanding on such date of reduction in excess of the
Commitment as reduced shall be due and payable, which principal payment may not
be made by means of Refinancing Advances.
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(c) MATURITY DATE. To the extent not otherwise required to be paid
earlier as provided herein, the principal amount of the Advances, all accrued
interest and fees thereon, and all other Obligations related thereto, shall be
due and payable in full on the Maturity Date.
Section 2.9 REIMBURSEMENT. Whenever any Lender shall sustain or incur
any losses or reasonable out-of-pocket expenses in connection with (a) failure
by the Borrower to borrow any LIBOR Advance after having given notice of its
intention to borrow in accordance with Section 2.2 hereof (whether by reason of
the Borrower's election not to proceed or the non-fulfillment of any of the
conditions set forth in Article 3 hereof), or (b) any prepayment for any reason
of any LIBOR Advance in whole or in part, the Borrower agrees to pay to any such
Lender, upon its demand, an amount sufficient to compensate such Lender for all
such losses and out-of-pocket expenses, subject to Section 10.9 hereof. Such
Lender's good faith determination of the amount of such losses or out-of-pocket
expenses, calculated in its usual fashion, absent manifest error, shall be
binding and conclusive. Such losses shall include, without limiting the
generality of the foregoing, lost profits and reasonable expenses incurred by
such Lender in connection with the re-employment of funds prepaid, repaid,
converted or not borrowed, converted or paid, as the case may be. Upon request
of the Borrower, such Lender shall provide a certificate setting forth the
amount to be paid to it by the Borrower hereunder and calculations therefor.
Section 2.10 MANNER OF PAYMENT.
(a) Each payment (including prepayments) by the Borrower of the
principal of or interest on the Advances, fees, and any other amount owed under
this Agreement or any other Loan Paper shall be made not later than 12:00 noon
(Dallas, Texas time) on the date specified for payment under this Agreement to
the Administrative Lender at the Administrative Lender's office, in lawful money
of the United States of America constituting immediately available funds.
(b) If any payment under this Agreement or any other Loan Paper shall be
specified to be made upon a day which is not a Business Day, it shall be made on
the next succeeding day which is a Business Day, unless such Business Day falls
in another calendar month, in which case payment shall be made on the preceding
Business Day. Any extension of time shall in such case be included in computing
interest and fees, if any, in connection with such payment.
(c) The Borrower agrees to pay principal, interest, fees and all other
amounts due under the Loan Papers without deduction for set-off or counterclaim
or any deduction whatsoever.
(d) If some but less than all amounts due from the Borrower are received
by the Administrative Lender, the Administrative Lender shall apply such amounts
in the following order of priority: (i) to the payment of the Administrative
Lender's expenses incurred on behalf of the Lenders then due and payable, if
any; (ii) to the payment of all other fees and amounts then due and payable
under the Loan Papers; (iii) to the payment of interest then due and
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payable on the Advances; and (iv) to the payment of principal then due and
payable on the Advances.
(e) Each payment by the Borrower in respect of obligations relating to
the Revolving Credit Advance and the Letters of Credit (whether for principal,
interest, fees or otherwise) shall be made to the Administrative Lender for the
account of the Lenders pro rata in accordance with their respective Specified
Percentages. Each payment by the Borrower in respect of obligations relating to
Swing Line Advances (whether for principal, interest, fees or otherwise) shall
be made to the Administrative Lender for the account of the Swing Line Bank.
Each payment by the Borrower in respect of obligations related to Bid Rate
Advances (whether for principal, interest, fees or otherwise) shall be made to
the Administrative Lender for the account of each Lender holding such Bid Rate
Advance. Notwithstanding anything in this Section 2.10(e) or any other
provision of this Agreement or any other Loan Paper to the contrary, any payment
by the Borrower in respect of any Advances after acceleration of the Advances
pursuant to Section 7.2 or any monies received by the Administrative Lender as a
result of the exercise of remedies under any Loan Papers after acceleration of
the Advances pursuant to Section 7.2 shall be distributed pro rata to each
Lender based on the percentage that the outstanding Advances and Reimbursement
Obligations owed to such Lender bears to the aggregate Advances and
Reimbursement Obligations owed to all Lenders.
Section 2.11 LIBOR LENDING OFFICES. Each Lender's initial LIBOR Lending
Office is set forth opposite its name in SCHEDULE 1 attached hereto. Each
Lender shall have the right at any time and from time to time to designate a
different office of itself or of any Affiliate as such Lender's LIBOR Lending
Office, and to transfer any outstanding LIBOR Advance to such LIBOR Lending
Office. No such designation or transfer shall result in any liability on the
part of the Borrower for increased costs or expenses resulting solely from such
designation or transfer (except any such transfer which is made by a Lender
pursuant to Section 8.2 or 8.3 hereof, or otherwise for the purpose of complying
with Applicable Law). Increased costs for expenses resulting from a change in
law occurring subsequent to any such designation or transfer shall be deemed not
to result solely from such designation or transfer.
Section 2.12 SHARING OF PAYMENTS. Any Lender obtaining a payment
(whether voluntary or involuntary, due to the exercise of any right of set-off,
or otherwise) on account of its Revolving Credit Advances or its participation
in the Letters of Credit (other than pursuant to Sections 2.15, 2.16(d), 8.3 or
8.5), in excess of its Specified Percentage of all payments made by the Borrower
with respect to Revolving Credit Advances and the Letters of Credit shall
purchase from each other Lender such participation in the Revolving Credit
Advances made by such other Lender or its participation in the Letters of Credit
as shall be necessary to cause such purchasing Lender to share the excess
payment pro rata according to Specified Percentages with each other Lender;
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, the purchase shall be
rescinded and the purchase price restored to the extent of such recovery, but
without interest. The Borrower agrees that any Lender so purchasing a
participation from another Lender pursuant to this Section, to the fullest
extent permitted by law, may exercise all its rights of payment (including
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the right of set-off) with respect to such participation as fully as if such
Lender were the direct creditor of the Borrower in the amount of such
participation.
Section 2.13 CALCULATION OF RATES. The provisions of this Agreement
relating to calculation of the LIBOR Rate are included only for the purpose of
determining the rate of interest or other amounts to be paid hereunder that are
based upon such rate, it being understood that each Lender shall be entitled to
fund and maintain its funding of all or any part of a LIBOR Advance as it sees
fit.
Section 2.14 BOOKING LOANS. Any Lender may make, carry or transfer
Advances at, to or for the account of any of its branch offices or the office of
any Affiliate.
Section 2.15 TAXES.
(a) Any and all payments by the Borrower hereunder shall be made, in
accordance with Section 2.10, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges and
withholdings, and all liabilities with respect thereto, EXCLUDING, in the case
of each Lender and the Administrative Lender, taxes imposed on, based upon or
measured by its overall net income, net worth or capital, and franchise taxes,
doing business taxes or minimum taxes imposed on it, (i) by the jurisdiction
under the laws of which such Lender or the Administrative Lender (as the case
may be) is organized and in which it has its applicable lending office or any
political subdivision thereof; (ii) by any other jurisdiction, or any political
subdivision thereof, other than those imposed by reason of (a) an asserted
relation of such jurisdiction to the transactions contemplated by this
Agreement, (b) the activities of the Borrower in such jurisdiction, or (c) the
activities in connection with the transactions contemplated by this Agreement of
a Lender or the Administrative Lender; (iii) by reason of failure by the Lender
or the Administrative Lender to comply with the requirements of paragraph (e) of
this Section 2.15; and (iv) in the case of any Lender, any Taxes in the nature
of transfer, stamp, recording or documentary taxes resulting from a transfer
(other than as a result of foreclosure) by such Lender of all or any portion of
its interest in this Agreement, the Notes or any other Loan Papers (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any Lender or the Administrative Lender, (x) the sum payable shall
be increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
2.15) such Lender or the Administrative Lender (as the case may be) receives an
amount equal to the sum it would have received had no such deductions been made,
(y) the Borrower shall make such deductions and (z) the Borrower shall pay the
full amount deducted to the relevant taxation authority or other authority in
accordance with applicable law.
(b) In addition, the Borrower agrees to pay any and all stamp and
documentary taxes and any and all other excise and property taxes, charges and
similar levies (other than (i) Taxes described in clause (iv) of the first
sentence of Section 2.15(a) and (ii) mortgage taxes payable
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in Oklahoma) that arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement or any
other Loan Paper (hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each Lender and the Administrative
Lender for the full amount of Taxes and Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable under this Section 2.15) paid by such Lender or the Administrative
Lender (as the case may be) and all liabilities (including penalties, additions
to tax, interest and reasonable expenses) arising therefrom or with respect
thereto whether or not such Taxes or Other Taxes were correctly or legally
asserted, other than penalties, additions to tax, interest and expenses arising
as a result of gross negligence on the part of such Lender or the Administrative
Lender, PROVIDED, HOWEVER, that the Borrower shall have no obligation to
indemnify such Lender or the Administrative Lender unless and until such Lender
or the Administrative Lender shall have delivered to the Borrower a certificate
setting forth in reasonable detail the basis of the Borrower's obligation to
indemnify such Lender or the Administrative Lender pursuant to this Section
2.15. This indemnification shall be made within 30 days from the date such
Lender or the Administrative Lender (as the case may be) makes written demand
therefor.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
will furnish to the Administrative Lender the original or a certified copy of a
receipt evidencing payment thereof. If no Taxes are payable in respect of any
payment hereunder, the Borrower will furnish to the Administrative Lender a
certificate from each appropriate taxing authority, or an opinion of counsel
acceptable to the Administrative Lender, in either case stating that such
payment is exempt from or not subject to Taxes, PROVIDED, HOWEVER, that such
certificate or opinion need only be given if: (i) the Borrower makes any
payment from any account located outside the United States, or (ii) the payment
is made by a payor that is not a United States Person. For purposes of this
Section 2.15 the terms "United States" and "United States Person" shall have the
meanings set forth in Section 7701 of the Code.
(e) Each Lender which is not a United States Person hereby agrees that:
(i) it shall, no later than the Agreement Date (or, in the case of
a Lender which becomes a party hereto pursuant to Section 10.6 after the
Agreement Date, the date upon which such Lender becomes a party hereto)
deliver to the Borrower through the Administrative Lender, with a copy to
the Administrative Lender:
(A) if any lending office is located in the United States of
America, two (2) accurate and complete signed originals of
Internal Revenue Service Form 4224 or any successor thereto
("Form 4224"),
(B) if any lending office is located outside the United States of
America, two (2) accurate and complete signed originals of
Internal Revenue Service Form 1001 or any successor thereto
("Form 1001").
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in each case indicating that such Lender is on the date of delivery
thereof entitled to receive payments of principal, interest and fees for
the account of such lending office or lending offices under this Agreement
free from withholding of United States Federal income tax;
(ii) if at any time such Lender changes its lending office or
lending offices or selects an additional lending office it shall, at the
same time or reasonably promptly thereafter but only to the extent the
forms previously delivered by it hereunder are no longer effective,
deliver to the Borrower through the Administrative Lender, with a copy to
the Administrative Lender, in replacement for the forms previously
delivered by it hereunder:
(A) if such changed or additional lending office is located in the
United States of America, two (2) accurate and complete signed
originals of Form 4224; or
(B) otherwise, two (2) accurate and complete signed originals of
Form 1001,
in each case indicating that such Lender is on the date of delivery
thereof entitled to receive payments of principal, interest and fees for
the account of such changed or additional lending office under this
Agreement free from withholding of United States Federal income tax;
(iii) it shall, before or promptly after the occurrence of any event
(including the passing of time but excluding any event mentioned in clause
(ii) above) requiring a change in the most recent Form 4224 or Form 1001
previously delivered by such Lender and if the delivery of the same be
lawful, deliver to the Borrower through the Administrative Lender with a
copy to the Administrative Lender, two (2) accurate and complete original
signed copies of Form 4224 or Form 1001 in replacement for the forms
previously delivered by such Lender;
(iv) it shall, promptly upon the request of the Borrower to that
effect, deliver to the Borrower such other forms or similar documentation
as may be required from time to time by any applicable law, treaty, rule
or regulation in order to establish such Lender's tax status for
withholding purposes; and
(v) it shall notify the Borrower within 30 days after any event
(including an amendment to, or a change in any applicable law or
regulation or in the written interpretation thereof by any regulatory
authority or any judicial authority, or by ruling applicable to such
Lender of any governmental authority charged with the interpretation or
administration of any law) shall occur that results in such Lender no
longer being capable of receiving payments without any deduction or
withholding of United States federal income tax.
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(f) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
this Section 2.15 shall survive the payment in full of principal and interest
hereunder.
(g) Any Lender claiming any additional amounts payable pursuant to this
Section 2.15 shall use its reasonable best efforts (consistent with its internal
policy and legal and regulatory restrictions) to change the jurisdiction of its
lending office, if the making of such a change would avoid the need for, or
reduce the amount of, any such additional amounts which may thereafter accrue
and would not, in the reasonable judgment of such Lender, be materially
disadvantageous to such Lender.
(h) Each Lender (and the Administrative Lender with respect to payments
to the Administrative Lender for its own account) agrees that (i) it will take
all reasonable actions by all usual means to maintain all exemptions, if any,
available to it from United States withholding taxes (whether available by
treaty, existing administrative waiver, by virtue of the location of any
Lender's lending office) and (ii) otherwise cooperate with the Borrower to
minimize amounts payable by the Borrower under this Section 2.15; PROVIDED,
HOWEVER, the Lenders and the Administrative Lender shall not be obligated by
reason of this Section 2.15(h) to contest the payment of any Taxes or Other
Taxes or to disclose any information regarding its tax affairs or tax
computations or reorder its tax or other affairs or tax or other planning.
Subject to the foregoing, to the extent the Borrower pays sums pursuant to this
Section 2.15 and the Lender or the Administrative Lender receives a refund of
any or all of such sums, such refund shall be applied to reduce any amounts then
due and owing under this Agreement or, to the extent that no amounts are due and
owing under this Agreement at the time such refunds are received, the party
receiving such refund shall promptly pay over all such refunded sums to the
Borrower, provided that no Default or Event of Default is in existence at such
time.
Section 2.16 LETTERS OF CREDIT.
(a) THE LETTER OF CREDIT FACILITY. The Borrower may request the
Issuing Bank, on the terms and conditions hereinafter set forth, to issue, and
the Issuing Bank shall, if so requested, issue, Financial Letters of Credit and
Non-Financial Letters of Credit (collectively, the "Letters of Credit") for the
account of the Borrower from time to time on any Business Day from the date of
the initial Advance until the Maturity Date in an aggregate maximum amount
(assuming compliance with all conditions to drawing) not to exceed at any time
outstanding the lesser of (i) $25,000,000 (the "Letter of Credit Facility") and
(ii) the remainder of (a) the Commitment MINUS (b) the aggregate principal
amount of Advances then outstanding. No Letter of Credit shall have an
expiration date (including all rights of renewal) later than the Maturity Date.
Immediately upon the issuance of each Letter of Credit (or upon the Agreement
Date, with respect to Existing Letters of Credit), the Issuing Bank shall be
deemed to have sold and transferred to each Lender, and each Lender shall be
deemed to have purchased and received from the Issuing Bank, in each case
irrevocably and without any further action by any party, an undivided interest
and participation in such Letter of Credit, each drawing thereunder and the
obligations of the Borrower under this Agreement in respect thereof in an amount
equal to the
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product of (x) such Lender's Specified Percentage times (y) the maximum amount
available to be drawn under such Letter of Credit (assuming compliance with all
conditions to drawing). Within the limits of the Letter of Credit Facility, and
subject to the limits referred to above, the Borrower may request the issuance
of Letters of Credit under this Section 2.16(a), repay any Advances resulting
from drawings thereunder pursuant to Section 2.16(c) and request the issuance of
additional Letters of Credit under this Section 2.16(a).
(b) REQUEST FOR ISSUANCE. Each Letter of Credit shall be issued upon
notice, given not later than 11:00 a.m. (Dallas time) on the third Business Day
prior to the date of the proposed issuance of such Letter of Credit, by the
Borrower to the Issuing Bank, which shall give to the Administrative Lender and
each Lender prompt notice thereof by telex, telecopier or cable. Each Letter of
Credit shall be issued upon notice given in accordance with the terms of any
separate agreement between the Borrower and the Issuing Bank in form and
substance reasonably satisfactory to the Borrower and the Issuing Bank providing
for the issuance of Letters of Credit pursuant to this Agreement and containing
terms and conditions not inconsistent with this Agreement (a "Letter of Credit
Agreement"), PROVIDED that if any such terms and conditions are inconsistent
with this Agreement, this Agreement shall control. Each such notice of issuance
of a Letter of Credit (a "Notice of Issuance") shall be by telex, telecopier or
cable, specifying therein, in the case of a Letter of Credit, the requested (a)
date of such issuance (which shall be a Business Day), (b) maximum amount of
such Letter of Credit, (c) expiration date of such Letter of Credit, (d) name
and address of the beneficiary of such Letter of Credit, (e) form of such Letter
of Credit and (f) such other information as shall be required pursuant to the
relevant Letter of Credit Agreement. If the requested terms of such Letter of
Credit are acceptable to the Issuing Bank in its reasonable discretion, the
Issuing Bank will, upon fulfillment of the applicable conditions set forth in
Article 3 hereof, make such Letter of Credit available to the Borrower at its
office referred to in Section 10.1 or as otherwise agreed with the Borrower in
connection with such issuance.
(c) DRAWING AND REIMBURSEMENT. The payment by the Issuing Bank of a
draft drawn under any Letter of Credit shall constitute for all purposes of this
Agreement the making by the Issuing Bank of a Revolving Credit Advance, which
shall bear interest at the applicable Base Rate Basis, in the amount of such
draft (but without any requirement for compliance with the conditions set forth
in Article 3 hereof). In the event that a drawing under any Letter of Credit is
not reimbursed by the Borrower by 11:00 a.m. (Dallas time) on the first Business
Day after such drawing, the Issuing Bank shall promptly notify Administrative
Lender and each other Lender. Each such Lender shall, on the first Business Day
following such notification, make a Revolving Credit Advance, which shall bear
interest at the applicable Base Rate Basis, and shall be used to repay the
applicable portion of the Issuing Bank's Revolving Credit Advance with respect
to such Letter of Credit, in an amount equal to the amount of its participation
in such drawing for application to reimburse the Issuing Bank (but without any
requirement for compliance with the applicable conditions set forth in Article 3
hereof) and shall make available to the Administrative Lender for the account of
the Issuing Bank, by deposit at the Administrative Lender's office, in same day
funds, the amount of such Revolving Credit Advance. In the event that any
Lender fails to make available to the Administrative Lender for
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the account of the Issuing Bank the amount of such Revolving Credit Advance, the
Issuing Bank shall be entitled to recover such amount on demand from such Lender
together with interest thereon at a rate per annum equal to the lesser of (i)
the Highest Lawful Rate or (ii) the Federal Funds Rate.
(d) INCREASED COSTS. If any change in any law or regulation or in the
interpretation thereof by any court or administrative or governmental authority
charged with the administration thereof shall either (i) impose, modify or deem
applicable any reserve, special deposit or similar requirement against letters
of credit or guarantees issued by, or assets held by, or deposits in or for the
account of, the Issuing Bank or any Lender or (ii) impose on the Issuing Bank or
any Lender any other condition regarding this Agreement or such Lender or any
Letter of Credit, and the result of any event referred to in the preceding
clause (i) or (ii) shall be to increase the cost to the Issuing Bank of issuing
or maintaining any Letter of Credit or to any Lender of purchasing any
participation therein or making any Advance pursuant to Section 2.16(c)
("Increased Letter of Credit Costs"), then, upon demand by the Issuing Bank or
such Lender, the Borrower shall, subject to Section 10.9 hereof, pay to the
Issuing Bank or such Lender, from time to time as specified by the Issuing Bank
or such Lender, additional amounts that shall be sufficient to compensate the
Issuing Bank or such Lender for such Increased Letter of Credit Costs.
Notwithstanding the foregoing, any demand for Increased Letter of Credit Costs
shall not include any Letter of Credit Costs with respect to any period more
than 180 days prior to the date that the Issuing Bank or any Lender gives notice
to the Borrower of such Increased Letter of Credit Costs unless the effective
date of the condition which results in the right to receive Increased Letter of
Credit Costs is retroactive (the "Increased Letter of Credit Costs Retroactive
Effective Date"). If any Increased Letter of Credit Costs has an Increased
Costs Letter of Credit Retroactive Effective Date and the Issuing Bank or any
Lender demands compensation within 180 days after the date setting the Increased
Letter of Credit Costs Effective Date (the "Increased Letter of Credit Costs Set
Date"), the Issuing Bank or such Lender, as appropriate, shall have the right to
receive such Increased Letter of Credit Costs from the Increased Letter of
Credit Retroactive Effective Date. If the Issuing Bank or a Lender does not
demand such Increased Letter of Credit Costs within 180 days after the Increased
Letter of Credit Costs Set Date, the Issuing Bank or such Lender, as
appropriate, may not receive payment of Increased Letter of Credit Costs with
respect to any period more than 180 days prior to such demand. A certificate as
to the amount of such Increased Costs, submitted to the Borrower by the Issuing
Bank or such Lender, shall include in reasonable detail the basis for the demand
for additional compensation and shall be conclusive and binding for all
purposes, absent manifest error. The obligations of the Borrower under this
Section 2.16(d) shall survive termination of this Agreement. The Issuing Bank
or any Lender claiming any additional compensation under this Section 2.16(d)
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to reduce or eliminate any such additional compensation which may thereafter
accrue and which efforts would not, in the sole discretion of the Issuing Bank
or such Lender, be otherwise disadvantageous.
(e) OBLIGATIONS ABSOLUTE. The obligations of the Borrower under this
Agreement with respect to any Letter of Credit, any Letter of Credit Agreement
and any other agreement or
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instrument relating to any Letter of Credit or any Advance pursuant to Section
2.16(c) shall be unconditional and irrevocable, and shall be paid strictly in
accordance with the terms of this Agreement, such Letter of Credit Agreement and
such other agreement or instrument under all circumstances, including, without
limitation, the following circumstances:
(i) any lack of validity or enforceability of this Agreement, any
other Loan Paper, any Letter of Credit Agreement, any Letter of Credit or
any other agreement or instrument relating thereto (collectively, the "L/C
Related Documents");
(ii) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations of the Borrower in
respect of the Letters of Credit or any Advance pursuant to Section
2.16(c) or any other amendment or waiver of or any consent to departure
from all or any of the L/C Related Documents;
(iii) the existence of any claim, set-off, defense or other right
that the Borrower may have at any time against any beneficiary or any
transferee of a Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), the Issuing Bank, any
Lender or any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by the L/C Related Documents or any
unrelated transaction;
(iv) any statement or any other document presented under a Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any
respect, except to the extent that the failure of the Issuing Bank to
determine such insufficiency is a result of the Issuing Bank's gross
negligence or wilful misconduct;
(v) payment by the Issuing Bank under a Letter of Credit against
presentation of a draft or certificate that does not comply with the terms
of the Letter of Credit, except for any payment made upon the Issuing
Bank's gross negligence or willful misconduct;
(vi) any exchange, release or non-perfection of any collateral, or
any release or amendment or waiver of or consent to departure from any
Subsidiary Guaranty or any other guarantee, for all or any of the
Obligations of the Borrower in respect of the Letters of Credit or any
Advance pursuant to Section 2.16(c); or
(vii) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including, without limitation, any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Borrower or a guarantor, other than the Issuing's Bank
gross negligence or wilful misconduct.
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(f) COMPENSATION.
(i) FINANCIAL LETTERS OF CREDIT. Subject to Section 10.9
hereof, the Borrower shall pay to the Administrative Lender for the
account of each Lender a fee (which shall be payable quarterly in arrears
on each Quarterly Date and on the Maturity Date) on the average daily
amount available for drawing under all outstanding Financial Letters of
Credit at the following per annum percentages, applicable in the following
situations:
APPLICABILITY PERCENTAGE
------------- ----------
CATEGORY 1 - The Leverage Ratio is not less than 0.70
3.50 to 1 or the Index Debt Rating is any two of
the following: BB by S&P, BB by ARA or Ba2 by
Xxxxx'x
CATEGORY 2 - The Leverage Ratio is less than 3.50 0.55
to 1 but not less than 3.00 to 1 or the Index Debt
Rating is any two of the following: BB+ by S&P,
BB+ by ARA or Ba1 by Xxxxx'x
CATEGORY 3 - The Leverage Ratio is less than 3.00 0.45
to 1 but not less than 2.50 to 1 or the Index Debt
Rating is any two of the following: BBB- by S&P,
BBB- by ARA or Baa3 by Xxxxx'x
CATEGORY 4 - The Leverage Ratio is less than 2.50 0.35
to 1 but not less than 2.00 to 1 or the Index Debt
Rating is any two of the following: BBB by S&P,
BBB by ARA or Baa2 by Xxxxx'x
CATEGORY 5 - The Leverage Ratio is less than 2.00 0.30
to 1 or the Index Debt Rating is any two of the
following: BBB+ or better by S&P, BBB+ or better
by ARA or Baa1 or better by Xxxxx'x
(ii) NON-FINANCIAL LETTERS OF CREDIT. Subject to Section 10.9
hereof, the Borrower shall pay to the Administrative Lender for the
account of each Lender a fee (which shall be payable quarterly in arrears
on each Quarterly Date and on the Maturity Date) on the average daily
amount available for drawing under all outstanding Non-Financial Letters
of Credit at the following per annum percentages, applicable in the
following situations:
APPLICABILITY PERCENTAGE
------------- ----------
CATEGORY 1 - The Leverage Ratio is not less than 0.35
3.50 to 1 or the Index Debt Rating is any two of
the following: BB by S&P, BB by ARA or Ba2 by
Xxxxx'x
- 40 -
CATEGORY 2 - The Leverage Ratio is less than 3.50 0.275
to 1 but not less than 3.00 to 1 or the Index
Debt Rating is any two of the following: BB+
by S&P, BB+ by ARA or Ba1 by Xxxxx'x
CATEGORY 3 - The Leverage Ratio is less than 3.00 0.225
to 1 but not less than 2.50 to 1 or the Index
Debt Rating is any two of the following:
BBB- by S&P, BBB- by ARA or Baa3 by Xxxxx'x
CATEGORY 4 - The Leverage Ratio is less than 2.50 0.175
to 1 but not less than 2.00 to 1 or the Index Debt
Rating is any two of the following: BBB
by S&P, BBB by ARA or Baa2 by Xxxxx'x
CATEGORY 5 - The Leverage Ratio is less than 2.00 0.150
to 1 or the Index Debt Rating is any two of the
following: BBB+ or better by S&P, BBB+ or
better by ARA or Baa1 or better by Xxxxx'x
(iii) ADJUSTMENT OF LETTER OF CREDIT FEE. The fee payable in
respect of the Letters of Credit shall be adjusted on each Adjustment Date
if determined based on the (i) Leverage Ratio, on a quarterly basis
according to the performance of the Borrower for the most recent fiscal
quarter or (ii) the Index Debt Rating, according to the most recent
determination of the Index Debt Rating. For purposes of the foregoing,
(a) if the Index Debt Rating and the Leverage Ratio are in different
categories, the commitment fee shall be determined on whichever of the
Index Debt Rating or the Leverage Ratio falls within the superior (or
numerically higher) category, (b) if the Letter of Credit fee is
determined based on the Leverage Ratio and the financial statements of the
Borrower setting forth the Leverage Ratio are not received by the
Administrative Lender by the date required pursuant to Section 6.1(a) or
6.1(b) hereof, the Letter of Credit fee shall be determined as if the
Leverage Ratio is not less than 3.50 to 1 until such time as such
financial statements are received, (c) if the Index Debt Rating
established by ARA shall fall within a different category than both
Xxxxx'x and S&P, the Letter of Credit fee shall be determined by reference
to Xxxxx'x or S&P, whichever shall be the superior (or numerically higher)
category, but not to exceed two rating levels higher than the other rating
agency. If the rating system of Xxxxx'x, S&P or ARA shall change prior to
the Maturity Date, the Borrower and the Lenders shall negotiate in good
faith to amend the references to specific ratings to reflect such changed
rating system.
(iv) OTHER FEES. In addition to the foregoing fees, subject to
Section 10.9 hereof, the Borrower shall also pay to the Issuing Bank for
its sole account (i) such customary fees, costs and expenses as may be
separately agreed to between the Borrower and the Issuing Bank and (ii) an
issuance and fronting fee in the amount of 0.075% of the average daily
amount available for drawing under all outstanding Letters of Credit,
which fronting fee shall be payable quarterly in arrears on each Quarterly
Date and on the Maturity Date.
- 41 -
(g) L/C CASH COLLATERAL ACCOUNT.
(i) Upon the occurrence and continuance of an Event of Default and
demand by the Administrative Lender pursuant to Section 7.2(c), the
Borrower will promptly pay to the Administrative Lender in immediately
available funds (which payment may not be made by means of an Advance) an
amount equal to 102% of the maximum amount then available to be drawn
under the Letters of Credit then outstanding. Any amounts so received by
the Administrative Lender shall be deposited by the Administrative Lender
in a deposit account maintained by the Issuing Bank (the "L/C Cash
Collateral Account").
(ii) As security for the payment of all Reimbursement Obligations
and for any other Obligations, the Borrower hereby grants, conveys,
assigns, pledges, sets over and transfers to the Administrative Lender
(for the benefit of the Issuing Bank and Lenders), and creates in the
Administrative Lender's favor (for the benefit of the Issuing Bank and
Lenders) a Lien in, all money, instruments and securities at any time held
in or acquired in connection with the L/C Cash Collateral Account,
together with all proceeds thereof. The L/C Cash Collateral Account shall
be under the sole dominion and control of the Administrative Lender and
the Borrower shall have no right to withdraw or to cause the
Administrative Lender to withdraw any funds deposited in the L/C Cash
Collateral Account. At any time and from time to time, upon the
Administrative Lender's request, the Borrower promptly shall execute and
deliver any and all such further instruments and documents, including UCC
financing statements, as may be necessary, appropriate or desirable in the
Administrative Lender's judgment to obtain the full benefits (including
perfection and priority) of the security interest created or intended to
be created by this paragraph (ii) and of the rights and powers herein
granted. The Borrower shall not create or suffer to exist any Lien on any
amounts or investments held in the L/C Cash Collateral Account other than
(a) the Lien granted under this paragraph (ii) and (b) Permitted
Collateral Liens.
(iii) The Administrative Lender shall (a) apply any funds in the L/C
Cash Collateral Account on account of Reimbursement Obligations when the
same become due and payable if and to the extent that the Borrower shall
fail directly to pay such Reimbursement Obligations and (b) after the
Maturity Date and provided no Letters of Credit are outstanding, apply any
proceeds remaining in the L/C Cash Collateral Account FIRST to pay any
unpaid Obligations then outstanding hereunder and THEN to refund any
remaining amount to the Borrower.
(iv) The Borrower, no more than once in any calendar month, may
direct the Administrative Lender to invest the funds held in the L/C Cash
Collateral Account (so long as the aggregate amount of such funds exceeds
any relevant minimum investment requirement) in (a) direct obligations of
the United States or any agency thereof, or obligations guaranteed by the
United States or any agency thereof and (b) one or more other types of
investments permitted by the Determining Lenders, in each case with such
- 42 -
maturities as the Borrower, with the consent of the Determining Lenders,
may specify, pending application of such funds on account of Reimbursement
Obligations or on account of other Obligations, as the case may be. In
the absence of any such direction from the Borrower, the Administrative
Lender shall invest the funds held in the L/C Cash Collateral Account (so
long as the aggregate amount of such funds exceeds any relevant minimum
investment requirement) in one or more types of investments with the
consent of the Determining Lenders with such maturities as the
Administrative Lender, with the consent of the Determining Lenders, may
specify, pending application of such funds on account of Reimbursement
Obligations or on account of other Obligations, as the case may be. All
such investments shall be made in the Administrative Lender's name for the
account of the Lenders. The Borrower recognizes that any losses or taxes
with respect to such investments shall be borne solely by the Borrower,
and the Borrower agrees to hold the Administrative Lender and the Lenders
harmless from any and all such losses and taxes. Administrative Lender
may liquidate any investment held in the L/C Cash Collateral Account in
order to apply the proceeds of such investment on account of the
Reimbursement Obligations (or on account of any other Obligation then due
and payable, as the case may be) without regard to whether such investment
has matured and without liability for any penalty or other fee incurred
(with respect to which the Borrower hereby agrees to reimburse the
Administrative Lender) as a result of such application.
(v) At such time, if any, which the Commitment has been terminated
and the only unpaid amount of the Obligations outstanding is Reimbursement
Obligations, the Administrative Lender shall release to the Borrower, no
more than once in any calendar month, the amount by which funds held in
the L/C Cash Collateral Account exceed 110% of the aggregate outstanding
Reimbursement Obligations. At such time as any Event of Default is cured
or waived, the Administrative Lender shall, upon written instruction from
the Borrower, promptly distribute to the Borrower any funds held in the
L/C Cash Collateral Account.
(vi) The Borrower shall pay to the Administrative Lender the fees
customarily charged by the Issuing Bank with respect to the maintenance of
accounts similar to the L/C Cash Collateral Account.
ARTICLE 3
CONDITIONS PRECEDENT
Section 3.1 CONDITIONS PRECEDENT TO THE INITIAL ADVANCES AND THE INITIAL
LETTERS OF CREDIT. The obligation of each Lender to sign this Agreement and to
make any Advance, and the obligation of the Issuing Bank to issue Letters of
Credit is subject to receipt by the Administrative Lender of the following, in
form and substance satisfactory to each Lender, with a copy (except for the
Notes) for each Lender, or satisfaction of the following:
- 43 -
(a) a loan certificate of the Borrower certifying as to the accuracy of
its representations and warranties in the Loan Papers, certifying that no
Default has occurred, and including a certificate of incumbency with respect to
each Authorized Signatory, and including (i) a copy of the articles of
incorporation of the Borrower, certified to be true, complete and correct by the
secretary of state of its state of incorporation, (ii) a copy of the by-laws of
the Borrower, as in effect on the Agreement Date, (iii) a copy of the
resolutions of the Borrower authorizing it to execute, deliver and perform this
Agreement, the Notes and the other Loan Papers to which it is a party, and (iv)
a copy of a certificate of good standing and a certificate of existence for its
state of incorporation and each state in which it is qualified to do business;
(b) a certificate of an officer acceptable to the Lenders of each
Significant Subsidiary, certifying as to the incumbency of the officers signing
the Loan Papers to which it is a party, and including (i) a copy of its articles
of incorporation (or articles of partnership or other appropriate governing
documents), certified as true, complete and correct by the secretary of state of
its state of incorporation or organization, (ii) a copy of its by-laws (or
partnership agreement or other appropriate governing document), as in effect on
the Agreement Date, (iii) a copy of the resolutions authorizing it to execute,
deliver and perform the Loan Papers to which it is a party, and (iv) a copy of a
certificate of good standing and a certificate of existence for its state of
incorporation;
(c) duly executed Revolving Credit Notes, payable to the order of each
Lender and in an amount for each Lender equal to its Specified Percentage of the
Commitment;
(d) opinions of counsel to the Borrower and the Subsidiaries addressed
to the Lenders and in form and substance satisfactory to the Lenders, dated the
Agreement Date, and covering the matters set forth in Sections 4.1(a), (b), (c),
(g), (l), (m) and (o) and such other matters incident to the transactions
contemplated hereby as the Administrative Lender or Special Counsel may
reasonably request;
(e) reimbursement for the Administrative Lender for Special Counsel's
reasonable fees and expenses rendered through the Agreement Date;
(f) evidence that all corporate or other proceedings of the Borrower and
Subsidiaries taken in connection with the transactions contemplated by this
Agreement and the other Loan Papers shall be reasonably satisfactory in form and
substance to the Lenders and Special Counsel; and the Lenders shall have
received copies of all documents or other evidence which the Administrative
Lender, Special Counsel or any Lender may reasonably request in connection with
such transactions;
(g) the closing fee as required pursuant to Sections 2.4(b);
(h) the duly executed and completed Guaranty Agreements, dated as of the
Agreement Date;
- 44 -
(i) any fees required to be paid pursuant to the Fee Letter;
(j) the duly executed Master Covenant Agreement;
(k) a certificate of an officer acceptable to the Lenders, in form and
substance satisfactory to the Lenders, certifying that the execution, delivery
and performance by the Obligors of the Loan Papers will not violate or result in
a default in respect of any of the terms of the Senior Subordinated Notes;
(l) payment in full of all accrued and outstanding obligations under the
Existing Credit Agreement (other than in respect of the Existing Letters of
Credit) whereupon all obligations of the Borrower (excluding those obligations
which expressly survive termination of the Existing Credit Agreement) and the
lenders party thereto (including but not limited to, the participations of the
Lenders in the Bond Letters of Credit) shall terminate;
(m) the duly executed Swing Line Note, payable to the order of the Swing
Line Bank in the principal amount of $10,000,000;
(n) closing and funding of the Senior Notes pursuant to terms acceptable
to the Lenders, and delivery of an executed final xxx of the Indenture with
respect to the Senior Notes;
(o) the duly executed Facility B Credit Agreement and all documents
related thereto;
(p) payment in full of all accrued and outstanding obligations under the
Amended and Restated Credit Agreement, dated as of April 21, 1995, among La
Quinta Development Partners, L.P., a Delaware limited partnership, the lenders
party thereto, NationsBank of Texas, NA., as Administrative Lender, and
Citibank, N.A., as Co-Administrative Lender;
(q) duly executed Bid Rate Notes, payable to the order of each Lender in
the principal amount of $200,000,000; and
(r) in form and substance satisfactory to the Lenders and Special
Counsel, such other documents, instruments and certificates as the
Administrative Lender or any Lender may reasonably require in connection with
the transactions contemplated hereby, including without limitation the status,
organization or authority of the Borrower or any Subsidiary or any other Person
executing a Loan Paper, and the enforceability of the Obligation.
Section 3.2 CONDITIONS PRECEDENT TO ALL ADVANCES AND LETTERS OF CREDIT.
The obligation of each Lender to make each Advance hereunder, and the obligation
of the Issuing Bank to issue each Letter of Credit hereunder is subject to
fulfillment of the following conditions immediately prior to or
contemporaneously with each such Advance or issuance:
(a) With respect to Advances other than Refinancing Advances and each
issuance of a Letter of Credit, all of the representations and warranties of the
Borrower under this
- 45 -
Agreement, which, pursuant to Section 4.2 hereof, are made at and as of the time
of such Advance or issuance, shall be true and correct at such time in all
material respects, both before and after giving effect to the application of the
proceeds of the Advance or issuance;
(b) The incumbency of the Authorized Signatories shall be as stated in
the certificate of incumbency delivered in the Borrower's loan certificate
pursuant to Section 3.1(a) or as subsequently modified and reflected in a
certificate of incumbency delivered to the Administrative Lender. The Lenders
may, without waiving this condition, consider it fulfilled and a representation
by the Borrower made to such effect if no written notice to the contrary, dated
on or before the date of such Advance or issuance, is received by the
Administrative Lender from the Borrower prior to the making of such Advance or
issuance;
(c) There shall not exist a Default hereunder, with respect to Advances
other than Refinancing Advances, or with respect to the issuance of Letters of
Credit, or an Event of Default, with respect to any Refinancing Advance, and,
with respect to each Advance other than a Refinancing Advance, and with respect
to issuance of each Letter of Credit, the Administrative Lender shall have
received written or telephonic certification thereof by an Authorized Signatory
(which certification, if telephonic, shall be followed promptly by written
certification);
(d) The aggregate Advances and amounts available for draw under Letters
of Credit, after giving effect to such proposed Advance or Letter of Credit,
shall not exceed the maximum principal amount then permitted to be outstanding
hereunder; and
(e) The Administrative Lender shall have received all such other
certificates, reports, statements, opinions of counsel or other documents as the
Administrative Lender or any Lender may reasonably request; PROVIDED,
HOWEVER, that the obligation of each Lender to make a Revolving Credit Advance
pursuant to Sections 2.2(g) and 2.16(c) shall be absolute and unconditional and
shall not be affected by any circumstances, including, without limitation, (i)
the occurrence of any Default or Event of Default, (ii) the failure of the
Borrower to satisfy any condition set forth in this Section 3.2, or (iii) any
other circumstance, happening or event whatsoever, except that the conditions
precedent set forth in Sections 3.1 and 3.2 with respect to the Swing Line Loan
or the Letter of Credit for which such Revolving Credit Advance is made pursuant
to Section 2.2(g) or 2.16(c) shall have been satisfied in full at the time of
the making of such Swing Line Loan or the issuance of such Letter of Credit.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Section 4.1 REPRESENTATIONS AND WARRANTIES. The Borrower hereby
represents and warrants to each Lender as follows:
- 46 -
(a) ORGANIZATION; POWER; QUALIFICATION. As of the Agreement Date, the
respective jurisdiction of incorporation and percentage ownership by the
Borrower or another Subsidiary of the Subsidiaries and Unincorporated Ventures
listed on SCHEDULE 3 are true and correct. Each of the Borrower and its
Subsidiaries and Unincorporated Ventures is a corporation or partnership, as
designated on SCHEDULE 3, duly organized, validly existing and in good
standing under the laws of its state of organization. Each of the Borrower and
its Subsidiaries has the corporate or other power and authority to own its
properties and to carry on its business as now being and hereafter proposed to
be conducted. Each of the Borrower and its Subsidiaries and Unincorporated
Ventures is duly qualified, in good standing and authorized to do business in
each jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization except where the failure
to be so qualified or authorized would not have a Material Adverse Effect.
(b) AUTHORIZATION. The Borrower has corporate power and has taken all
necessary corporate action to authorize it to borrow hereunder. Each of the
Loan Parties has corporate or other power and has taken all necessary corporate
or other action to execute, deliver and perform the Loan Papers to which it is
party in accordance with the terms thereof, and to consummate the transactions
contemplated thereby. Each Loan Paper has been duly executed and delivered by
the Loan Party executing it. Each of the Loan Papers to which the Loan Parties
are party is a legal, valid and binding respective obligation of the Loan Party
executing it, enforceable in accordance with its terms, subject to the following
qualifications: (i) equitable principles generally, and (ii) Debtor Relief Laws
(insofar as any such law relates to the bankruptcy, insolvency or similar event
of any Loan Party).
(c) COMPLIANCE WITH OTHER LOAN PAPERS AND CONTEMPLATED TRANSACTIONS.
The execution, delivery and performance by the Loan Parties of the Loan Papers
to which they are respectively a party, and the consummation of the transactions
contemplated thereby, do not and will not (i) require any consent or approval
not already obtained, (ii) violate any Applicable Law, (iii) conflict with,
result in a breach of, or constitute a default under the articles of
incorporation, by-laws, articles of partnership, partnership agreements or
similar governing documents of any Loan Party, or under any Necessary
Authorization, indenture, agreement or other instrument, to which any Loan Party
is a party or by which they or their respective properties may be bound, or (iv)
result in or require the creation or imposition of any Lien upon or with respect
to any property now owned or hereafter acquired by any Loan Party, except
Permitted Liens.
(d) LICENSES, ETC. All Necessary Authorizations which are material
have been duly obtained, and are in full force and effect without any known
conflict with the rights of others and free from any unduly burdensome
restrictions which could reasonably be expected to have a Material Adverse
Effect. The Borrower and its Subsidiaries and Unincorporated Ventures are and
will continue to be in compliance in all material respects with all provisions
thereof. No circumstance exists which might impair the utility of the Necessary
Authorization or the right to renew such Necessary Authorization the effect of
which would have a Material Adverse Effect. No Necessary Authorization which
could reasonably be expected to have a Material
- 47 -
Adverse Effect is the subject of any pending or, to the best of the Borrower's
knowledge, threatened challenge, suspension, cancellation or revocation.
(e) COMPLIANCE WITH LAW. The Borrower and its Subsidiaries and
Unincorporated Ventures are in compliance in all respects with all Applicable
Laws, except where the failure to so comply would not have a Material Adverse
Effect.
(f) TITLE TO PROPERTIES. The Borrower and its Subsidiaries and
Unincorporated Ventures have good and indefeasible title to, or a valid
leasehold interest in, all of their material assets. None of their assets are
subject to any Liens, except Permitted Liens. No effective financing statement
or other Lien filing (except relating to Permitted Liens) is on file in any
state or jurisdiction that names the Borrower or any of its Subsidiaries or
Unincorporated Ventures as debtor or covers (or purports to cover) any assets of
the Borrower or any of its Subsidiaries or Unincorporated Ventures. The
Borrower and its Subsidiaries and Unincorporated Ventures have not signed any
such financing statement or filing, nor any security agreement authorizing any
Person to file any such financing statement or filing.
(g) LITIGATION. Except as reflected on SCHEDULE 2 hereto, there is
no action, suit or proceeding pending against, or, to the best of the Borrower's
knowledge, threatened against the Borrower, or in any other manner relating
directly and adversely to the Borrower or any of its Subsidiaries or
Unincorporated Ventures, or any of their properties, in any court or before any
arbitrator of any kind or before or by any governmental body in which the amount
claimed (in excess of applicable insurance) exceeds a Material Amount.
(h) TAXES. All federal, state and other tax returns of the Borrower
and its Subsidiaries and Unincorporated Ventures required by law to be filed
have been duly filed and all federal, state and other taxes, assessments and
other governmental charges or levies upon the Borrower, its Subsidiaries or
Unincorporated Ventures or any of their respective properties, income, profits
and assets, which are due and payable, have been paid, unless the same are being
diligently contested in good faith by appropriate proceedings, with adequate
reserves established therefor, and no Lien (other than a Permitted Lien) has
attached and no foreclosure, distraint, sale or similar proceedings have been
commenced. The charges, accruals and reserves on the books of the Borrower and
its Subsidiaries and Unincorporated Ventures in respect of their respective
taxes are, in the judgment of the Borrower, adequate.
(i) FINANCIAL STATEMENTS; MATERIAL LIABILITIES. The Borrower has
furnished or caused to be furnished to the Lenders copies of its December 31,
1994 and June 30, 1995 financial statements, which present fairly in accordance
with GAAP the financial position of the Borrower and its Subsidiaries and
Unincorporated Ventures as at such dates and the results of operations for the
periods then ended. The Borrower and its Subsidiaries and Unincorporated
Ventures taken as a whole have no material liabilities, contingent or otherwise,
nor material losses, except (i) as set forth in the December 31, 1994 financial
statements, (ii) in respect of the Senior Notes and (iii) the "AEW Transaction"
as defined and described in the Borrower's Form S-3 dated August 11, 1995.
- 48 -
(j) NO ADVERSE CHANGE. Since December 31, 1994, no event or
circumstances has occurred or arisen that could have a Material Adverse Effect.
(k) ERISA. None of the Borrower or its Controlled Group maintains or
contributes to any Plan other than those disclosed to the Administrative Lender
in writing. Each such Plan (other than any Multiemployer Plan) is in compliance
in all material respects with the applicable provisions of ERISA, the Code, and
any other applicable Federal or state law, rule or regulation. With respect to
each Plan (other than any Multiemployer Plan) of the Borrower and each member of
its Controlled Group, all reports required under ERISA or any other Applicable
Law to be filed with any governmental authority, the failure of which to file
could reasonably result in liability of the Borrower or any member of its
Controlled Group in excess of a Material Amount, have been duly filed. All such
reports are true and correct in all material respects as of the date given. No
Plan of the Borrower or any member of its Controlled Group has been terminated
under Section 4041(c) of ERISA nor has any accumulated funding deficiency (as
defined in Section 412(a) of the Code) been incurred (without regard to any
waiver granted under Section 412 of the Code), nor has any funding waiver from
the Internal Revenue Service been received or requested the result of which
could reasonably be expected to have Material Adverse Effect. None of the
Borrower or any member of its Controlled Group has failed to make any
contribution or pay any amount due or owing as required under the terms of any
such Plan, or by Section 412 of the Code or Section 302 of ERISA by the due date
under Section 412 of the Code and Section 302 of ERISA the result of which could
reasonably be expected to have Material Adverse Effect. There has been no ERISA
Event or any event requiring disclosure under Section 4041(c)(3)(c) or 4063(a)
of ERISA with respect to any Plan or its related trust of the Borrower or any
member of its Controlled Group since the effective date of ERISA. The present
value of the benefit liabilities, as defined in Title IV of ERISA, of each Plan
subject to Title IV of ERISA (other than a Multiemployer Plan) of the Borrower
and each member of its Controlled Group does not exceed by more than $10,000,000
the present value of the assets of each such Plan as of the most recent
valuation date using each such Plan's actuarial assumptions at such date. There
are no pending, or to the best of the Borrower's knowledge threatened, claims,
lawsuits or actions (other than routine claims for benefits in the ordinary
course) asserted or instituted against, and neither the Borrower nor any member
of its Controlled Group has knowledge of any threatened litigation or claims
against, the assets of any Plan or its related trust or against any fiduciary of
a Plan with respect to the operation of such Plan the result of which could
reasonably be expected to have Material Adverse Effect. None of the Borrower
or, to the best of the Borrower's knowledge, any member of its Controlled Group
has engaged in any prohibited transactions, within the meaning of Section 406 of
ERISA or Section 4975 of the Code, in connection with any Plan the result of
which could reasonably be expected to have Material Adverse Effect. None of the
Borrower or any member of its Controlled Group has withdrawn from any
Multiemployer Plan, nor has incurred or reasonably expects to incur (a) any
liability under Title IV of ERISA (other than premiums due under Section 4007 of
ERISA to the PBGC), (b) any withdrawal liability (and no event has occurred
which with the giving of notice under Section 4219 of ERISA would result in such
liability) under Section 4201 of ERISA as a result of a complete or partial
withdrawal (within the meaning of Section 4203 or 4205 of ERISA) from a
Multiemployer Plan, or (c) any liability under Section 4062 of
- 49 -
ERISA to the PBGC or to a trustee appointed under Section 4042 of ERISA. None
of the Borrower, any member of its Controlled Group, or any organization to
which the Borrower or any member of its Controlled Group is a successor or
parent corporation within the meaning of ERISA Section 4069(b), has engaged in a
transaction within the meaning of ERISA Section 4069 the result of which could
reasonably be expected to have Material Adverse Effect. None of the Borrower or
any member of its Controlled Group maintains or has established any Plan, which
is a material welfare benefit plan within the meaning of Section 3(1) of ERISA
and which provides for continuing benefits or coverage for any participant or
any beneficiary of any participant after such participant's termination of
employment, except as may be required by the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA") and the regulations thereunder.
Each of Borrower and its Controlled Group which maintains a Plan which is a
welfare benefit plan within the meaning of Section 3(1) of ERISA has complied in
all material respects with any applicable notice and continuation requirements
of COBRA and the regulations thereunder, except to the extent that the failure
to so comply could not reasonably be expected to have a Material Adverse Effect.
None of the Borrower or any member of its Controlled Group maintains, has
established, or has ever participated in a multiemployer welfare benefit
arrangement within the meaning of Section 3(40)(a) of ERISA.
(l) COMPLIANCE WITH REGULATIONS G, T, U AND X. The Borrower is not
engaged principally or as one of its important activities in the business of
extending credit for the purpose of purchasing or carrying any margin stock
within the meaning of Regulations G, T, U and X of the Board of Governors of the
Federal Reserve System, and no part of the proceeds of the Advances or any
Letters of Credit will be used to purchase or carry any margin stock or to
extend credit to others for the purpose of purchasing or carrying any margin
stock. No assets of the Borrower and its Subsidiaries and Unincorporated
Ventures are margin stock. None of the Borrower and its Subsidiaries nor any
agent acting on their behalf, have taken or will knowingly take any action which
might cause this Agreement or any other Loan Papers to violate any regulation of
the Board of Governors of the Federal Reserve System or to violate the
Securities Exchange Act of 1934, in each case as in effect now or as the same
may hereafter be in effect.
(m) GOVERNMENTAL REGULATION. The Borrower and its Subsidiaries and
Unincorporated Ventures are not required to obtain any Necessary Authorization
that has not already been obtained from, or effect any material filing or
registration that has not already been effected with, any federal, state or
local regulatory authority in connection with the execution and delivery of this
Agreement or any other Loan Paper, or the performance thereof (other than any
enforcement of remedies by the Administrative Lender on behalf of the Lenders,
in accordance with their respective terms, including any borrowings hereunder.
(n) ABSENCE OF DEFAULT. The Borrower and its Subsidiaries and
Unincorporated Ventures are in compliance in all respects with all of the
provisions of their articles of incorporation, by-laws, articles of partnership,
partnership agreement or other governing documents, and no event has occurred or
failed to occur, which has not been remedied or waived, the occurrence or
non-occurrence of which constitutes, or which with the passage of
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time or giving of notice or both would constitute, (i) an Event of Default or
(ii) a default by the Borrower or any of its Subsidiaries or Unincorporated
Ventures under any material indenture, agreement or other instrument, or any
judgment, decree or order to which the Borrower or any of its Subsidiaries or
Unincorporated Ventures or by which they or any of their material properties is
bound.
(o) INVESTMENT COMPANY ACT. The Borrower is not required to register
under the provisions of the Investment Company Act of 1940, as amended. Neither
the entering into or performance by the Borrower of this Agreement nor the
issuance of the Notes violates any provision of such act or requires any
consent, approval, or authorization of, or registration with, the Securities and
Exchange Commission or any other governmental or public body of authority
pursuant to any provisions of such act.
(p) ENVIRONMENTAL MATTERS. Neither the Borrower nor any Subsidiary or
Unincorporated Venture has any actual knowledge or reason to believe that any
substance deemed hazardous by any Applicable Environmental Law, has been
installed on any real property now owned by the Borrower or any of its
Subsidiaries or Unincorporated Ventures which, individually or in the aggregate,
would reasonably be expected to have a Material Adverse Effect. The Borrower
and its Subsidiaries and Unincorporated Ventures have complied in all respects
with all Applicable Environmental Laws except to the extent that the failure to
so comply, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect. The Borrower and its Subsidiaries and
Unincorporated Ventures are not in violation in any respects of or subject to
any existing, pending or, to the best of the Borrower's knowledge, threatened
investigation or inquiry by any governmental authority or to any material
remedial obligations under any Applicable Environmental Laws, except to the
extent that the results of such investigation, inquiry or remedial obligation
would not, individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect, and this representation and warranty would continue to
be true and correct following disclosure to the applicable governmental
authorities of all relevant facts, conditions and circumstances, if any,
pertaining to any real property of the Borrower and its Subsidiaries and
Unincorporated Ventures. The Borrower and its Subsidiaries and Unincorporated
Ventures have obtained all material permits, licenses or similar authorizations
necessary to construct, occupy, operate or use any buildings, improvements,
fixtures, and equipment forming a part of any real property of the Borrower or
any Subsidiary or Unincorporated Venture by reason of any Applicable
Environmental Laws, except where the failure to obtain such authorization would
not, individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect. The Borrower and its Subsidiaries and Unincorporated Ventures
undertook, at the time of acquisition of any real property, reasonable inquiry
into the previous ownership and uses of such real property consistent with good
commercial or customary practice as applied and used in the real estate industry
at the time of each such acquisition. The Borrower and its Subsidiaries and
Unincorporated Ventures have taken all reasonable steps to determine, and the
Borrower and its Subsidiaries and Unincorporated Ventures have no actual
knowledge or reason to believe, after reasonable investigation, that any
hazardous substances or solid wastes have been disposed of or otherwise released
on or to the real property of the Borrower or any of its Subsidiaries or
Unincorporated
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Ventures, within the meaning of the Applicable Environmental Laws, except to the
extent that the failure to so depose or release, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.
(q) CERTAIN FEES. No broker's, finder's or other fee or commission
will be payable by the Borrower (other than to the Lenders hereunder) with
respect to the making of the Commitments or the Advances or the issuance of the
Letters of Credit hereunder. The Borrower agrees to indemnify and hold harmless
the Administrative Lender and each Lender from and against any claims, demand,
liability, proceedings, costs or expenses asserted with respect to or arising in
connection with any such fees or commissions.
(r) NECESSARY AUTHORIZATIONS. No event has occurred which permits (or
with the passage of time would permit) the revocation or termination of any
Necessary Authorization, or which could result in the imposition of any
restriction thereon, of such a nature that could reasonably be expected to have
a Material Adverse Effect.
(s) PATENTS, ETC. The Borrower and its Subsidiaries and
Unincorporated Ventures have obtained all patents, trademarks, service-marks,
trade names, copyrights, licenses and other rights, free from burdensome
restrictions, that are necessary for the operation of their business as
presently conducted and as proposed to be conducted. Nothing has come to the
attention of the Borrower or any of its Subsidiaries or Unincorporated Ventures
to the effect that (i) any process, method, part or other material presently
contemplated to be employed by the Borrower or any Subsidiary or Unincorporated
Venture may infringe any patent, trademark, service-xxxx, trade name, copyright,
license or other right owned by any other Person, or (ii) there is pending or
overtly threatened any claim or litigation against or affecting the Borrower or
any Subsidiary or Unincorporated Venture contesting its right to sell or use any
such process, method, part or other material, provided with respect to clauses
(i) and (ii) that such events are limited to those which could reasonably be
expected to have a Material Adverse Effect.
(t) DISCLOSURE. Neither this Agreement nor any other document,
certificate or statement which has been furnished to any Lender by or on behalf
of the Borrower or any Subsidiary or Unincorporated Venture in connection
herewith contained any untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statement contained herein and
therein not misleading at the time it was furnished. There is no fact known to
the Borrower and not known to the public generally that could reasonably be
expected to materially adversely affect the assets or business of the Borrower
and its Subsidiaries and Unincorporated Ventures, or in the future could
reasonably be expected (so far as the Borrower can now foresee) to have a
Material Adverse Effect, which has not been set forth in this Agreement or in
the documents, certificates and statements furnished to the Lenders by or on
behalf of the Borrower prior to the date hereof in connection with the
transaction contemplated hereby.
(u) SOLVENCY. The Borrower is, and Borrower and its Subsidiaries and
Unincorporated Ventures on a consolidated basis are, Solvent.
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Section 4.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC. All
representations and warranties made under this Agreement and the other Loan
Papers shall be deemed to be made at and as of the Agreement Date and at and as
of the date of each Advance and issuance of each Letter of Credit, and each
shall be true and correct when made, except to the extent (a) previously
fulfilled in accordance with the terms hereof, (b) applicable to a specific date
or otherwise subsequently inapplicable or modified to give effect to the
transactions expressly permitted hereby, or (c) previously waived in writing by
the Determining Lenders with respect to any particular factual circumstance.
All such representations and warranties shall survive, and not be waived by, the
execution hereof by any Lender, any investigation or inquiry by any Lender, or
by the making of any Advance or the issuance of any Letter of Credit under this
Agreement.
ARTICLE 5
BUSINESS COVENANTS
So long as any of the Obligations are outstanding and unpaid or the
Commitment is outstanding (whether or not the conditions to borrowing have been
or can be fulfilled):
Section 5.1 MAINTENANCE OF PROPERTY, INSURANCE, ACCOUNTING PRACTICES,
CORPORATE EXISTENCE. The Borrower covenants and agrees to, and will cause each
Subsidiary and Unincorporated Venture to:
(a) Maintain its material property in good condition and make all
necessary renewals, replacements, additions, betterments and improvements
thereto, consistent with sound business practice and as is customary in the case
of corporations or other entities of established reputation engaged in the same
or a similar business and similarly situated;
(b) Maintain, with financially sound and reputable insurers, or through
its own program of self-insurance, insurance with respect to its material
properties and business against such casualties and contingencies, of such
types, and in such amounts as is customary in the case of corporations or other
entities of established reputation engaged in the same or a similar business and
similarly situated;
(c) Keep books of record and accounts in which entries will be made of
all of its business transactions, and will reflect in it financial statements
adequate accruals and appropriations to reserves, all in accordance with GAAP;
(d) Do or cause to be done all things necessary to preserve and keep in
full force and effect its material rights;
(e) Do or cause to be done all things necessary to preserve and keep in
full force and effect its existence (except as may be specifically permitted by
this Agreement); and
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(f) Cause to be paid and discharged (i) all lawful tax assessments and
governmental charges imposed from the income or profits of the Borrower, its
Subsidiaries and Unincorporated Ventures or upon any property belonging to the
Borrower, any Subsidiary or any Unincorporated Venture and (ii) all lawful
claims, whether for labor, materials, supplies, services or anything else, which
have become due and payable and which by law have or may become a Lien upon the
property of the Borrower or any of its Subsidiaries or Unincorporated Ventures;
PROVIDED, HOWEVER, that the Borrower, its Subsidiaries and Unincorporated
Ventures shall not be required to cause to be paid or discharged any such tax
assessment, charge or claim so long as the amount, applicability or validity
thereof shall be contested in good faith by appropriate proceedings, and
adequate book reserves shall have been established to the extent required by
GAAP with respect thereto.
Section 5.2 INSPECTION OF PROPERTIES AND BOOKS. The Borrower covenants
and agrees that it will permit, and will cause each Subsidiary and
Unincorporated Venture to permit, any Lender, upon (i) reasonable request, if
such request is prior to the occurrence of a Default or an Event of Default or
(ii) request, if such request is after the occurrence of a Default or an Event
of Default, to any Authorized Officer, to visit and inspect any of the
properties of, to examine the books of account and records of the Borrower, any
Subsidiary or Unincorporated Venture and to take extracts therefrom and to
discuss the affairs, finances or accounts of the Borrower, any Subsidiary or
Unincorporated Venture, and to be advised as to the same by the officers of the
Borrower, at all such times during normal business hours, in such detail and
through such agents and representatives as such Bank may reasonably desire.
Section 5.3 MERGER AND SALE OF ASSETS.
(a) The Borrower covenants and agrees that it will not, and will cause
each Subsidiary and Unincorporated Venture to not, directly or indirectly sell,
transfer or otherwise dispose of any of its assets (whether now owned or
hereafter acquired, and including any interest in a joint venture or
partnership) unless immediately prior to, and after giving effect to, such sale,
transfer or other disposition, the Borrower, its Subsidiaries and Unincorporated
Ventures are and will be in compliance with all covenants hereunder and there
shall otherwise be no Default or Event of Default hereunder; and
(b) The Borrower covenants and agrees that it will not, and will cause
each Subsidiary and Unincorporated Venture to not, merge into or consolidate
with any other Person; provided, however, if after giving effect to any such
merger or consolidation, (i) the business of the Borrower or any Subsidiary or
Unincorporated Venture, as appropriate, will not be materially changed and (ii)
the Borrower or any Subsidiary or Unincorporated Venture, as appropriate, will
not be in default in respect of any of the covenants contained in any material
agreement, including, without limitation, this Agreement, to which the Borrower
or any Subsidiary or Unincorporated Venture is a party or by which its property
may be bound,
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(1) any corporation, partnership or joint venture may merge or
consolidate with the Borrower, provided that the Borrower shall be the
continuing and surviving corporation,
(2) any Subsidiary may merge with or consolidate with any
corporation, partnership or joint venture, provided that, unless such
merger or consolidation shall be with the Borrower, such Subsidiary shall
be the continuing and surviving corporation, and
(3) any Unincorporated Venture may merge with or consolidate with
any corporation, partnership or joint venture, provided that, unless such
merger or consolidation shall be with the Borrower or a Subsidiary, such
Unincorporated Venture shall be the continuing and surviving person.
Section 5.4 NET WORTH. The Borrower covenants and agrees that it will
not allow its Net Worth at any time to be less than the sum of (i) $285,000,000
plus (ii) 50% of Consolidated Net Income (excluding Consolidated Net Income for
any fiscal quarter in which Consolidated Net Income was a negative number)
earned on or after the Agreement Date, plus (iii) 75% of the Net Cash Proceeds
of any equity issues of the Borrower's Capital Stock after the Agreement Date.
Section 5.5 CONTINGENT LIABILITIES. The Borrower covenants and agrees
that it will not, and will cause each Subsidiary and Unincorporated Venture to
not, guarantee, endorse, contingently agree to purchase, or otherwise become
liable, directly or indirectly, upon the obligation of or in connection with the
earnings, the assets, the stock, or the dividends of any other Person (other
than the Borrower or any Subsidiary), including obligations of the Borrower,
each Subsidiary and Unincorporated Venture arising solely by virtue of any of
them being a general partner or venturer of any Unincorporated Venture, except
(i) the obligations in respect of the written agreements in existence on the
Agreement Date in respect of any Significant Investments, (ii) the guarantees
and other contingent obligations set forth on SCHEDULE 11 hereto, (iii)
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection, (iv) guarantees of loans to any employee; PROVIDED,
THAT any such guaranty of an employee loan shall not exceed the amount of
$100,000 per employee, and the amount of such guaranties of employee loans,
together with the amount of Investments permitted pursuant to clause (vi) of the
definition of "Permitted Investments," shall not exceed, in the aggregate, more
than $2,000,000, and (v) guarantees and contingent obligations incurred after
the Agreement Date not to exceed $20,000,000 in aggregate principal amount.
Section 5.6 INCURRENCE AND RETENTION OF DEBT. The Borrower covenants
and agrees that it will not, and will cause each Subsidiary and Unincorporated
Venture to not, incur, create, assume, or suffer to exist any Debt (other than
Debt existing on the Agreement Date) unless, immediately prior to, and after the
incurrence of, such Debt, the Borrower, its Subsidiaries and Unincorporated
Ventures are and will be in compliance with all covenants hereunder and there
shall otherwise be no Default or Event of Default hereunder.
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Section 5.7 INVESTMENTS. The Borrower will not, and will cause each
Subsidiary and Unincorporated Venture to not, make or permit to remain any
Investment other than a Permitted Investment.
Section 5.8 NOTICE OF LITIGATION. The Borrower covenants and agrees
that it will, and will cause each Subsidiary and Unincorporated Venture to,
promptly give notice in writing to the Lenders (i) of any litigation to which
the Borrower, any Subsidiary or Unincorporated Venture becomes a party, if (a)
the amount in controversy exceeds $500,000 and (b) the Borrower's insurance
carrier does not acknowledge coverage with respect to such litigation, and (ii)
of all proceedings before any governmental or regulatory agencies (a) affecting
or potentially affecting the business or property of the Borrower, any
Subsidiary or Unincorporated Venture in an amount in excess of $500,000 or (b)
materially affecting the ability of the Borrower, any Subsidiary or
Unincorporated Venture to perform their respective covenants and obligations
hereunder or under any other obligations owed any Lender.
Section 5.9 TOTAL DEBT RATIO. The Borrower covenants and agrees that it
will not allow the ratio of (i) Total Debt to (ii) EBITDA, in each case for the
four consecutive fiscal quarters immediately preceding the date of
determination, to be greater than 4.00 to 1 at the end of any fiscal quarter.
For purposes of this Section 5.9, with respect to assets not owned at all times
during the four consecutive quarters immediately preceding the date of
determination of EBITDA, there shall be (i) included in EBITDA (without
duplication) the EBITDA of any assets acquired during any such four consecutive
fiscal quarters immediately preceding the date of determination and (ii)
excluded from EBITDA the EBITDA of any asset disposed of during any such four
consecutive fiscal quarters immediately preceding the date of determination.
Section 5.10 CASH FLOW RATIO. The Borrower covenants and agrees that it
will not allow the ratio of (i)(a) EBITDA, plus (b) lease expense pursuant to
Operating Leases, minus (c) Maintenance Capital Expenditures to (ii)(a) Net
Interest, plus (b) lease expense pursuant to Operating Leases, plus (c) Current
Maturities, in each case other than Current Maturities (which, with respect to
Current Maturities, shall be for the four consecutive fiscal quarters
immediately succeeding the date of determination) for the four consecutive
fiscal quarters immediately preceding the date of determination, to be less than
1.50 to 1 at the end of any fiscal quarter.
Section 5.11 SENIOR DEBT RATIO. The Borrower covenants and agrees that
it will not allow the ratio of (i) Senior Debt to (ii) EBITDA, in each case for
the four consecutive fiscal quarters immediately preceding the date of
determination, to be greater than 3.0 to 1 at the end of any fiscal quarter. For
purposes of this Section 5.11, with respect to assets not owned at all times
during the four consecutive quarters immediately preceding the date of
determination of EBITDA, there shall be (i) included in EBITDA (without
duplication) the EBITDA of any assets acquired during any such four consecutive
fiscal quarters immediately preceding the date of determination and (ii)
excluded from EBITDA the EBITDA of any asset disposed of during any such four
consecutive fiscal quarters immediately preceding the date of determination.
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Section 5.12 LIENS. The Borrower covenants and agrees that it will not
create, assume or suffer to exist, or permit any Subsidiary or Unincorporated
Venture to create, assume or suffer to exist, any Lien on any asset now owned or
hereafter acquired by it except Permitted Liens. Other than with respect to
Senior Notes, the Borrower shall not, and shall not permit any Subsidiary or
Unincorporated Venture to, agree with any Person that it shall not create,
assume, incur, permit or suffer to exist or to be created, assumed, incurred or
permitted to exist, directly or indirectly, any Lien on any of its assets.
Section 5.13 ACCOUNTING CHANGES. The Borrower covenants and agrees that
it will not, and will not permit an of its Subsidiaries or Unincorporated
Ventures to, make any change in its accounting treatment or financial reporting
practices, except as permitted or required by GAAP in effect from time to time.
The Borrower will not change its fiscal year or the calculation of its fiscal
quarter ends.
Section 5.14 AMENDMENT AND MODIFICATION OF SUBORDINATED DEBT DOCUMENTS.
The Borrower covenants and agrees that it will not, and it will not permit any
Subsidiary or Unincorporated Venture to, directly or indirectly, amend, modify,
supplement, waive compliance with, or assent to noncompliance with, any term,
provision or condition of any of the documents governing or evidencing the
Subordinated Debt, which (i) the Lenders deem material (including, without
limitation, relating to events of default, acceleration rights, interest rates,
tenor, maturity date, subordination, covenants, prohibition against amending any
documents related to this Agreement and definitions with respect thereto
(including, without limitation, the definition of "Senior Debt")) or (ii) places
any further restrictions on the Borrower, its Subsidiaries or Unincorporated
Ventures or increases the obligations of the Borrower, its Subsidiaries or
Unincorporated Ventures thereunder or confers on the holders thereof any
additional rights.
Section 5.15 LEASE-BACKS. The Borrower covenants and agrees that it will
not, and will not permit any Subsidiary or Unincorporated Venture to, enter into
any arrangements, directly or indirectly, with any Person, whereby the Borrower,
any Subsidiary or Unincorporated Venture shall sell or transfer any property,
whether now owned or hereafter acquired, used or useful in its business, and
thereafter rent or lease the property so sold or transferred in an aggregate
amount (determined at the greater of fair market value or net book value) in
excess of $20,000,000 during the term of this Agreement.
Section 5.16 ENVIRONMENTAL MATTERS.
(a) The Borrower covenants and agrees that it will not, and will not
permit any of its Subsidiaries or Unincorporated Ventures to, use, generate,
manufacture, produce, store, release, discharge or dispose of on, under or about
any real property owned or leased by the Borrower or any of its Subsidiaries or
Unincorporated Ventures (such owned or leased real property, the "Property"), or
transport to or from the Property, any Hazardous Substance (as defined below),
or (to the extent within the Borrower's or such Subsidiary's or Unincorporated
Venture's control) permit any other Person to do so, where such could reasonably
be expected to have a Material Adverse Effect.
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(b) The Borrower shall keep and maintain and shall cause each Subsidiary
and Unincorporated Venture to keep and maintain, the Property in compliance with
any Environmental Law (as defined below) where the failure to do so could
reasonably be expected to have a Material Adverse Effect.
(c) In the event that any investigation, site monitoring, containment,
cleanup, removal, restoration or other remedial work of any kind or nature (the
"Remedial Work") with respect to the Property is required to be performed by the
Borrower or any of its Subsidiaries or Unincorporated Ventures under any
applicable local, state or federal law or regulation, any judicial order, or by
any governmental entity because of, or in connection with, the current or future
presence, suspected presence, release or suspected release of a Hazardous
Substance in or into the air, soil, groundwater or surface water at, on, under
or within the Property (or any portion thereof), the Borrower or such Subsidiary
or Unincorporated Venture shall within thirty (30) days after written demand for
performance thereof by the Lenders (or such shorter period of time as may be
required under any applicable law, regulation, order or agreement), commence and
thereafter diligently prosecute to completion, all such Remedial Work.
(d) The Borrower will defend, indemnify and hold harmless the Lenders,
and their respective employees, agents, officers and directors, from and against
any claims, demands, penalties, fines, liabilities, settlements, damages, costs
and expenses of whatever kind or nature known or unknown, contingent or
otherwise, arising out of, or in any way relating to the violation of,
noncompliance with or liability under any Environmental Law applicable to the
operations of the Borrowers or any Subsidiary or Unincorporated Venture or the
Property, or any orders, requirements or demands of Tribunal related thereto,
including, without limitation, attorneys' and consultants' fees, investigation
and laboratory fees, response costs, court costs and litigation expenses, except
to the extent that any of the foregoing arise out of the gross negligence or
willful misconduct of the party seeking indemnification therefor. This
indemnity shall continue in full force and effect regardless of the termination
of this Agreement.
(e) As used herein, (i) "Environmental Law" means any federal, state
or local law, statute, ordinance, or regulation now or hereafter in effect
pertaining to health, industrial hygiene, or the environmental conditions on,
under or about the Property, and (ii) the term "Hazardous Substance" means
those substances included within the definitions of "hazardous substances",
"hazardous materials", "toxic substances", or "solid waste" under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended, 42 U.S.C. Sections 9601 ET SEQ., the Resource Conservation and
Recovery Act of 1976, 42 U.S.C. Sections 6901 ET SEQ. and the Hazardous
Materials Transportation Act, 49 U.S.C. Sections 1801 ET SEQ., and in the
regulations laws, and such other substances, materials and wastes which are
or become regulated under applicable local, state or federal law, or which
are classified as hazardous or toxic under federal, state, or local laws or
regulations.
Section 5.17 ERISA COMPLIANCE. The Borrower covenants and agrees that it
shall, and shall cause each Subsidiary and Unincorporated Venture to (i) at all
times, make prompt payment of all contributions required under all Plans and
required to meet the minimum funding
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standard set forth in ERISA with respect to its Plans, (ii) after the discovery
by an Authorized Officer, notify the Lenders immediately of any fact, including,
but not limited to, any Reportable Event arising in connection with any of its
Plans, which might constitute grounds for termination thereof by the PBGC or for
the appointment by the appropriate United States District Court of a trustee to
administer such Plan, together with a statement, if requested by any Lender, as
to the reason therefor and the action, if any, proposed to be taken with respect
thereto, and (iii) not permit any Plan to be subject to any involuntary
termination proceedings.
Section 5.18 BUSINESS. The Borrower covenants and agrees that it will
not, and will not permit any Subsidiary or Unincorporated Venture to, engage in,
directly or through other Persons, any business other than the businesses now
carried on and other businesses directly related thereto.
Section 5.19 DEBT. The Borrower covenants and agrees that it will not,
and will cause each Subsidiary and Unincorporated Venture to not, (i) default,
beyond any notice, grace or cure period, in any payment equal to or exceeding
the aggregate amount of $1,000,000 of principal of or interest on any Debt with
respect to which recourse may be made against the Borrower or any Subsidiary or
Unincorporated Venture beyond any period of grace provided with respect thereto,
or (ii) default, beyond any notice, grace or cure period, in the performance of
any other agreement, term, covenant or condition contained in any agreement or
instrument under or by which any such Debt, the unpaid principal amount of which
then equals or exceeds $1,000,000 is created, evidenced or secured if the effect
of such default is to cause such Debt to become due before its stated maturity.
Section 5.20 TRANSACTIONS WITH AFFILIATES. The Borrower covenants and
agrees that it will not, and will not permit any Subsidiary or Unincorporated
Venture to, directly or indirectly, enter into any transaction (including, but
not limited to, the sale or exchange of property or the rendering of service)
with any of its Affiliates, other than in the ordinary course of business and
upon fair and reasonable terms no less favorable than the Borrower or any
Subsidiary or Unincorporated Venture could obtain or could become entitled to in
an arm's-length transaction with a Person which was not an Affiliate.
Section 5.21 USE OF PROCEEDS. The Borrower shall use the proceeds of the
Commitment to refinance the debt outstanding under the Existing Credit Agreement
and for working capital and general corporate purposes, including repayment of
Debt.
Section 5.22 INDEMNITY.
(a) THE BORROWER AGREES TO DEFEND, PROTECT, INDEMNIFY AND HOLD HARMLESS
THE ADMINISTRATIVE LENDER, EACH LENDER, EACH OF THEIR RESPECTIVE AFFILIATES, AND
EACH OF THEIR RESPECTIVE (INCLUDING SUCH AFFILIATES') OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS, ATTORNEYS, SHAREHOLDERS AND CONSULTANTS (INCLUDING, WITHOUT
LIMITATION, THOSE RETAINED IN CONNECTION WITH THE SATISFACTION OR ATTEMPTED
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SATISFACTION OF ANY OF THE CONDITIONS SET FORTH HEREIN) OF EACH OF THE FOREGOING
(COLLECTIVELY, "INDEMNITEES") FROM AND AGAINST ANY AND ALL LIABILITIES,
OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, CLAIMS,
COSTS, EXPENSES AND DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER (INCLUDING,
WITHOUT LIMITATION, THE FEES AND DISBURSEMENTS OF COUNSEL FOR SUCH INDEMNITEES
IN CONNECTION WITH ANY INVESTIGATIVE, ADMINISTRATIVE OR JUDICIAL PROCEEDING,
WHETHER OR NOT SUCH INDEMNITEES SHALL BE DESIGNATED A PARTY THERETO), IMPOSED
ON, INCURRED BY, OR ASSERTED AGAINST SUCH INDEMNITEES (WHETHER DIRECT, INDIRECT
OR CONSEQUENTIAL AND WHETHER BASED ON ANY FEDERAL, STATE, OR LOCAL LAWS AND
REGULATIONS, UNDER COMMON LAW OR AT EQUITABLE CAUSE, OR ON CONTRACT, TORT OR
OTHERWISE, ARISING FROM OR CONNECTED WITH THE PAST, PRESENT OR FUTURE OPERATIONS
OF THE BORROWER OR ITS PREDECESSORS IN INTEREST, OR THE PAST, PRESENT OR FUTURE
ENVIRONMENTAL CONDITION OF PROPERTY OF THE BORROWER), IN ANY MANNER RELATING TO
OR ARISING OUT OF THIS AGREEMENT, THE LOAN PAPERS, OR ANY ACT, EVENT OR
TRANSACTION OR ALLEGED ACT, EVENT OR TRANSACTION RELATING OR ATTENDANT THERETO,
THE MAKING OF ANY PARTICIPATIONS IN THE ADVANCES OR THE LETTERS OF CREDIT AND
THE MANAGEMENT OF THE ADVANCES OR THE LETTERS OF CREDIT, INCLUDING IN CONNECTION
WITH, OR AS A RESULT, IN WHOLE OR IN PART, OF ANY NEGLIGENCE OF ADMINISTRATIVE
LENDER OR ANY LENDER (OTHER THAN THOSE MATTERS RAISED EXCLUSIVELY BY A
PARTICIPANT AGAINST THE ADMINISTRATIVE LENDER OR ANY LENDER AND NOT THE
BORROWER), OR THE USE OR INTENDED USE OF THE PROCEEDS OF THE ADVANCES OR THE
LETTERS OF CREDIT HEREUNDER, OR IN CONNECTION WITH ANY INVESTIGATION OF ANY
POTENTIAL MATTER COVERED HEREBY, BUT EXCLUDING (i) ANY CLAIM OR LIABILITY THAT
ARISES AS THE RESULT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY
INDEMNITEE, AS FINALLY JUDICIALLY DETERMINED BY A COURT OF COMPETENT
JURISDICTION, AND (ii) MATTERS RAISED BY ONE LENDER AGAINST ANOTHER LENDER OR BY
ANY SHAREHOLDERS OF A LENDER AGAINST A LENDER OR ITS MANAGEMENT (COLLECTIVELY,
"INDEMNIFIED MATTERS"). TO THE EXTENT THAT ANY INDEMNIFIED MATTER INVOLVES ONE
OR MORE INDEMNITEES, SUCH INDEMNITEES SHALL USE THE SAME LEGAL COUNSEL UNLESS
ANY INDEMNITEE IN ITS REASONABLE DISCRETION DETERMINES THAT CONFLICTS EXIST OR
MAY ARISE IN CONNECTION WITH SUCH REPRESENTATION.
(b) IN ADDITION, THE BORROWER SHALL PERIODICALLY, UPON REQUEST,
REIMBURSE EACH INDEMNITEE FOR ITS REASONABLE LEGAL AND OTHER ACTUAL EXPENSES
(INCLUDING THE COST OF ANY INVESTIGATION AND PREPARATION) INCURRED IN CONNECTION
WITH ANY INDEMNIFIED MATTER. IF FOR ANY REASON THE FOREGOING INDEMNIFICATION IS
UNAVAILABLE TO ANY INDEMNITEE OR INSUFFICIENT TO HOLD ANY INDEMNITEE HARMLESS
WITH
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RESPECT TO INDEMNIFIED MATTERS, THEN THE BORROWER SHALL CONTRIBUTE TO THE AMOUNT
PAID OR PAYABLE BY SUCH INDEMNITEE AS A RESULT OF SUCH LOSS, CLAIM, DAMAGE OR
LIABILITY IN SUCH PROPORTION AS IS APPROPRIATE TO REFLECT NOT ONLY THE RELATIVE
BENEFITS RECEIVED BY THE BORROWER AND THE BORROWER'S STOCKHOLDERS ON THE ONE
HAND AND SUCH INDEMNITEE ON THE OTHER HAND BUT ALSO THE RELATIVE FAULT OF THE
BORROWER AND SUCH INDEMNITEE, AS WELL AS ANY OTHER RELEVANT EQUITABLE
CONSIDERATIONS. THE REIMBURSEMENT, INDEMNITY AND CONTRIBUTION OBLIGATIONS UNDER
THIS SECTION SHALL BE IN ADDITION TO ANY LIABILITY WHICH THE BORROWER MAY
OTHERWISE HAVE, SHALL EXTEND UPON THE SAME TERMS AND CONDITIONS TO EACH
INDEMNITEE, AND SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF ANY
SUCCESSORS, ASSIGNS, HEIRS AND PERSONAL REPRESENTATIVES OF THE BORROWER, THE
ADMINISTRATIVE LENDER, THE LENDERS AND ALL OTHER INDEMNITEES. THIS SECTION
SHALL SURVIVE ANY TERMINATION OF THIS AGREEMENT AND PAYMENT OF THE OBLIGATIONS.
ARTICLE 6
INFORMATION
Section 6.1 FINANCIAL STATEMENTS AND OTHER REPORTS BY THE BORROWER. The
Borrower will deliver to each Lender:
(a) As soon as practicable after the end of each of the first three
quarterly fiscal periods in each fiscal year of the Borrower, and in any event
within 45 days thereafter, duplicate copies of
(1) Combined balance sheets, statements of earnings, shareholders'
equity and cash flows for the portion of the fiscal year ending with such
quarter; all in reasonable detail and accompanied by an Officer's
Certificate certifying that the aforementioned financial statements
present fairly the financial position of the Borrower (Combined Basis) at
the end of such quarter and the results of operations and the changes in
financial position for the portion of the fiscal year ending with such
quarter, determined in accordance with GAAP; and
(2) An Officer's Certificate (with calculations and a new
SCHEDULE 11 attached thereto) certifying (i) as to any increases or
reductions in interest in the Significant Investments, and (ii) compliance
with Sections 5.4, 5.5, 5.9, 5.10 and 5.11.
(b) As soon as practicable after the end of each fiscal year of the
Borrower and in any event within 120 days thereafter, duplicate copies of:
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(1) Combined balance sheets, statements of earnings, shareholders'
equity and cash flows of the Borrower for such year; all in reasonable
detail, prepared on a basis consistent with the financial statements
delivered to all Lenders in prior periods and accompanied by an
unqualified opinion and report of KPMG Peat Marwick, or other independent
certified accountants of recognized standing selected by the Borrower and
reasonably consented to by Lenders, which report shall state that no
default under this Agreement and no condition or event which after notice
or lapse of time or both would constitute a default under this Agreement
has come to the knowledge of such accountants or, if such is not the case,
the details of such default or such condition or event; and
(2) An Officer's Certificate (with calculations and a new
SCHEDULE 11 attached thereto) certifying (i) as to any increases or
reductions in interest in the Significant Investments, and (ii) compliance
with Sections 5.4, 5.5, 5.9, 5.10 and 5.11.
(c) As soon as practicable after the Borrower or any Subsidiary files
with the S.E.C. any of the following documents and in any event within 10 days
thereafter, a copy of:
(1) Any final Registration Statement filed for the registration of
any securities under the Securities Act of 1933, as amended (except a
Registration Statement on Form S-8 for the registration of stock to be
issued in connection with any Stock Plan);
(2) Each Annual and Periodic Report filed under Section 13 or
15(d) of the Securities Exchange Act of 1934, as amended;
(3) Each definitive Proxy Statement filed pursuant to the
Securities Exchange Act of 1934, as amended; and
together with any other document filed with the S.E.C. or the New York
Stock Exchange, Inc., as may be requested by any Lender.
(d) Upon request by any Lender, copies of the following:
(1) Each annual report/return, as well as all schedules and
attachments required to be filed with the Department of Labor and/or the
Internal Revenue Service pursuant to ERISA and the regulations promulgated
thereunder, in connection with each of its Plans for each Plan year; and
(2) Such additional information concerning any of its Plans as may
be reasonably requested.
(e) On the date of receipt by the Borrower of any change in the Index
Debt Rating, a copy of such change.
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(f) Promptly upon the occurrence of a Default or Event of Default, a
written notice specifying the nature and period of existence thereof and what
action is being taken or is proposed to be taken with respect thereto.
(g) Promptly upon becoming aware thereof, notice of the commencement or
filing (or of a threat to commence or file) of any action, suit or proceeding
before any court or any federal, state, municipal or other governmental agency
or authority involving claims for damages, fines or penalties in excess of
$500,000 (after deducting any amount with respect to which the Borrower, any
Subsidiary or Unincorporated Venture is insured) against or in any other way
relating to the Borrower, any Subsidiary or any Unincorporated Venture or any of
their respective properties or businesses.
(h) With reasonable promptness, such other data and information as from
time to time may be reasonably requested by any Lender.
(i) Notwithstanding anything in this Section 6.1 to the contrary, (i) if
the terms of any Subordinated Debt of the Borrower requires delivery of Parent
Company financial statements and (ii) any Lender shall request delivery of
Parent Company financial statements, the Borrower shall also deliver to such
Lender the financial statements required to be delivered pursuant to (1) Section
6.1(a) on a Parent Company basis within 60 days after the end of the first three
quarterly fiscal periods of the Borrower and (2) Section 6.1(b) on a Parent
Company basis within 120 days after the end of each fiscal year of the Borrower.
Section 6.2 OFFICER'S CERTIFICATE. Each set of financial statements
delivered pursuant to Sections 6.1(a) and (b) shall be accompanied by an
Officer's Certificate stating whether there exists on the date of such
certificate any condition or event which then constitutes, or which after notice
or lapse of time or both, would constitute, a breach of any covenant herein, and
if any such condition or event then exists, specifying the nature and period of
existence thereof and the action the Borrower is taking or proposes to take with
respect thereto.
ARTICLE 7
DEFAULT
Section 7.1 EVENTS OF DEFAULT. Each of the following shall constitute
an Event of Default, whatever the reason for such event, and whether voluntary,
involuntary, or effected by operation of law or pursuant to any judgment or
order of any court or any order, rule or regulation of any governmental or
non-governmental body:
(a) The Borrower fails to make any payment of principal on any Note or
any Reimbursement Obligation on the date such payment is due;
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(b) The Borrower fails to make any payment of interest on any Note,
Reimbursement Obligation or any other costs, fees, expenses or other amounts
payable hereunder or under the other Loan Papers within one Business Day after
the date such payment is due;
(c) The Borrower or any Subsidiary or Unincorporated Venture fails to
perform or observe (i) any covenant contained in Sections 5.3, 5.4, 5.5, 5.6,
5.7, 5.9, 5.10, 5.11, 5.12, 5.13, 5.14, 5.15, 5.19, 5.20 or 5.21 of this
Agreement or (ii) any other covenant in this Agreement or any other Loan Paper
(other than the Master Covenant Agreement) to be performed or observed by it and
such failure with respect to such other covenants continues for a period of 30
days after any Lender has given written notice specifying such failure to the
Borrower;
(d) Any material warranty or representation by or on behalf of the
Borrower or any Subsidiary or Unincorporated Venture contained in this Agreement
or any other Loan Paper is false or misleading in any material respect;
(e) The Borrower or any Subsidiary or Unincorporated Venture fails to
make any payment due on any other Debt in an aggregate amount of at least
$1,000,000 beyond any applicable grace period, including any extension thereof,
or the Company, or any Subsidiary fails to perform or observe any other
provision contained in any such Debt or any agreement securing or relating to
such Debt if and only if the effect of such failure to make such payment or to
perform or observe such other provision is to cause or permit the holder of such
Debt or any Person acting on such holder's behalf to cause such Debt to become
due prior to its stated maturity;
(f) The Borrower or any Significant Subsidiary or Unincorporated Venture
(other than Insolvent Unincorporated Ventures) (i) shall become insolvent, (ii)
shall fail to pay its debts generally as they become due, (iii) shall make a
general assignment for the benefit of creditors, (iv) shall voluntarily seek,
consent to, or acquiesce in the benefit of any Debtor Relief Law, (v) shall
become a party to or is made the subject of any proceeding provided for by any
Debtor Relief Law, other than as a creditor or claimant (unless, in the event
such proceeding is involuntary, the petition instituting same is dismissed
within 60 days after its filing), or (vi) take any corporate or other action for
the purpose of effecting any of the foregoing;
(g) The Borrower or any Subsidiary or Unincorporated Venture fails to
have discharged, within a period of 45 days after the expiration of all rights
of appeal, any judgment, warrant of attachment, sequestration, or similar
proceeding against any of its respective assets with a value, individually or
collectively, in excess of a Material Amount;
(h) The Borrower or any Subsidiary or Unincorporated Venture shall fail
to perform or observe, beyond any grace period provided with respect thereto and
provided that the Borrower has been given a notice of default with respect to,
any covenant contained in that certain Master Covenant Agreement;
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(i) Any material provision of any Loan Paper after delivery thereof
hereunder shall for any reason cease to be valid and binding on the Person
(other than any Lender) executing such Loan Paper, or the Borrower or such
Person shall so state in writing;
(j) A final judgment or judgments for the payment of money shall be
entered by a court or courts against the Borrower or any Subsidiary or
Unincorporated Venture and such judgment or judgments remain unstayed or
undischarged for a period of 30 days from the date of entry thereof and the
aggregate amount of all such judgments exceeds a Material Amount (net of actual
insurance coverage if the Lenders receive evidence satisfactory to them that
coverage exists);
(k) With respect to any Plan of the Borrower or any member of its
Controlled Group: (i) the Borrower, any such member, or any other
party-in-interest or disqualified person shall engage in transactions which in
the aggregate would reasonably result in a direct or indirect liability to the
Borrower or any member of its Controlled Group in excess of $100,000 under
Section 409 or 502 of ERISA or Section 4975 of the Code; (ii) the Borrower or
any member of its Controlled Group shall incur any accumulated funding
deficiency, as defined in Section 412 of the Code, in the aggregate in excess of
$100,000, or request a funding waiver from the Internal Revenue Service for
contributions in the aggregate in excess of $100,000; (iii) the Borrower or any
member of its Controlled Group shall incur any withdrawal liability in the
aggregate in excess of $100,000 as a result of a complete or partial withdrawal
within the meaning of Section 4203 or 4205 of ERISA, or any other liability with
respect to a Plan in excess of $100,000, unless the amount of such liability has
been funded within the Plan or pursuant to one or more insurance contracts; (iv)
the Borrower or any member of its Controlled Group shall fail to make a required
contribution by the due date under Section 412 of the Code or Section 302 of
ERISA which would result in the imposition of a lien under Section 412 of the
Code or Section 302 of ERISA; (v) the Borrower, any member of its Controlled
Group or any Plan sponsor shall notify the PBGC of an intent to terminate, or
the PBGC shall institute proceedings to terminate, or the PBGC shall institute
proceedings to terminate, any Plan subject to Title IV of ERISA; (vi) a
Reportable Event shall occur with respect to a Plan subject to Title IV of
ERISA, and within 15 days after the reporting of such Reportable Event to the
Administrative Lender, the Administrative Lender shall have notified the
Borrower in writing that the Determining Lenders have made a determination that,
on the basis of such Reportable Event, there are reasonable grounds for the
termination of such Plan by the PBGC or for the appointment by the appropriate
United States District Court of a trustee to administer such Plan and as a
result thereof an Event of Default shall have occurred hereunder; (vii) a
trustee shall be appointed by a court of competent jurisdiction to administer
any Plan or the assets thereof; (viii) the benefits of any Plan shall be
increased, or the Borrower or any member of its Controlled Group shall begin to
maintain, or begin to contribute to, any Plan, without the prior written consent
of the Determining Lenders; or (ix) any ERISA Event with respect to a Plan
subject to Title IV of ERISA shall have occurred, and 30 days thereafter (a)
such ERISA Event, other than such event described in clause (f) of the
definition of ERISA Event herein, (if correctable) shall not have been corrected
and (b) the then present value of such Plan's benefit liabilities, as defined in
Title IV of ERISA, shall exceed the then current value of assets
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accumulated in such Plan; provided, however, that the events listed in
subsections (v) through (ix) shall constitute Events of Default only if, as of
the date thereof or any subsequent date, the amount of liability that the
Borrower or any member of its Controlled Group reasonably is likely to incur in
the aggregate under Section 4062, 4063, 4064, 4219 or 4023 of ERISA or any other
provision of law with respect to all such Plans, computed by the actuary of the
Plan taking into account any applicable rules and regulations of the PBGC at
such time, and based on the actuarial assumptions used by the Plan, resulting
from or otherwise associated with such event exceeds $100,000; or
(l) A Change of Control shall have occurred.
Section 7.2 REMEDIES. If an Event of Default shall have occurred and
shall be continuing:
(a) With the exception of an Event of Default specified in Section
7.1(f) hereof, the Administrative Lender shall, upon the direction of the
Determining Lenders, terminate the Commitment and/or declare the principal of
and interest on the Advances and all Obligations and other amounts owed under
the Loan Papers to be forthwith due and payable without presentment, demand,
protest or notice of any kind, all of which are hereby expressly waived,
anything in the Loan Papers to the contrary notwithstanding.
(b) Upon the occurrence of an Event of Default specified in Section
7.1(f) hereof, such principal, interest and other amounts shall thereupon and
concurrently therewith become due and payable and the Commitment shall
automatically forthwith terminate, all without any action by the Administrative
Lender, any Lender or any holders of the Notes and without presentment, demand,
protest or other notice of any kind, all of which are expressly waived, anything
in the Loan Papers to the contrary notwithstanding.
(c) If any Letter of Credit shall be then outstanding, the
Administrative Lender may demand upon the Borrower to, and forthwith upon such
demand, the Borrower shall, pay to the Administrative Lender in same day funds
at the office of the Administrative Lender in such demand for deposit in the L/C
Cash Collateral Account, an amount equal to 102% of the maximum amount available
to be drawn under the Letters of Credit then outstanding.
(d) The Administrative Lender, and the Lenders may exercise all of the
post-default rights granted to them under the Loan Papers or under Applicable
Law.
(e) The rights and remedies of the Administrative Lender and the Lenders
hereunder shall be cumulative, and not exclusive.
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ARTICLE 8
CHANGES IN CIRCUMSTANCES
Section 8.1 LIBOR BASIS DETERMINATION INADEQUATE. If with respect to
any proposed LIBOR Advance for any Interest Period, any Lender determines that
(i) deposits in dollars (in the applicable amount) are not being offered to that
Lender in the relevant market for such Interest Period or (ii) the LIBOR Basis
for such proposed LIBOR Advance does not adequately cover the cost to such
Lender of making and maintaining such proposed LIBOR Advance for such Interest
Period, such Lender shall forthwith give notice thereof to the Borrower,
whereupon until such Lender notifies the Borrower that the circumstances giving
rise to such situation no longer exist, the obligation of such Lender to make
LIBOR Advances shall be suspended.
Section 8.2 ILLEGALITY. If any applicable law, rule or regulation, or
any change therein or adoption thereof, or interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Lender
(or its LIBOR Lending Office) with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency, shall make it unlawful or impossible for such Lender (or its LIBOR
Lending Office) to make, maintain or fund its LIBOR Advances, such Lender shall
so notify the Borrower and the Administrative Lender. Before giving any notice
to the Borrower pursuant to this Section, the notifying Lender shall designate a
different LIBOR Lending Office or other lending office if such designation will
avoid the need for giving such notice and will not, in the sole judgment of the
Lender, be materially disadvantageous to the Lender. Upon receipt of such
notice, notwithstanding anything contained in Article 2 hereof, the Borrower
shall repay in full the then outstanding principal amount of each LIBOR Advance
owing to the notifying Lender, together with accrued interest thereon, on either
(a) the last day of the Interest Period applicable to such Advance, if the
Lender may lawfully continue to maintain and fund such Advance to such day, or
(b) immediately, if the Lender may not lawfully continue to fund and maintain
such Advance to such day. Concurrently with repaying each affected LIBOR
Advance owing to such Lender, notwithstanding anything contained in Article 2
hereof, the Borrower shall borrow a Base Rate Advance from such Lender, and such
Lender shall make such Base Rate Advance, in an amount such that the outstanding
principal amount of the Advances owing to such Lender shall equal the
outstanding principal amount of the Advances owing immediately prior to such
repayment.
Section 8.3 INCREASED COSTS.
(a) If any applicable law, rule or regulation, or any change in or
adoption of any law, rule or regulation, or any interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof or compliance by any Lender
(or its LIBOR Lending Office) with any request or directive (whether or not
having the force of law) of any such authority, central bank or compatible
agency:
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(i) shall subject a Lender (or its LIBOR Lending Office) to any
Tax (net of any tax benefit engendered thereby) with respect to its LIBOR
Advances or its obligation to make such Advances, or shall change the
basis of taxation of payments to a Lender (or to its LIBOR Lending Office)
of the principal of or interest on its LIBOR Advances or in respect of any
other amounts due under this Agreement, as the case may be, or its
obligation to make such Advances (except for changes in the rate of tax on
the overall net income, net worth or capital of the Lender and franchise
taxes, doing business taxes or minimum taxes imposed upon such Lender); or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors of
the Federal Reserve System), special deposit or similar requirement
against assets of, deposits with or for the account of, or credit extended
by, a Lender's LIBOR Lending Office or shall impose on the Lender (or its
LIBOR Lending Office) or on the United States market for certificates of
deposit or the London interbank market any other condition affecting its
LIBOR Advances or its obligation to make such Advances;
and the result of any of the foregoing is to increase the cost to a Lender (or
its LIBOR Lending Office) of making or maintaining any LIBOR Advances, or to
reduce the amount of any sum received or receivable by a Lender (or its LIBOR
Lending Office) with respect thereto, by an amount deemed by a Lender to be
material ("Increased Advance Costs"), then, within 15 days after demand by a
Lender, the Borrower agrees to pay to such Lender such additional amount as will
compensate such Lender for such increased costs or reduced amounts, subject to
Section 10.9 hereof. The affected Lender will as soon as practicable notify the
Borrower of any event of which it has knowledge, occurring after the date
hereof, which will entitle such Lender to compensation pursuant to this Section
and will designate a different LIBOR Lending Office or other lending office if
such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the sole judgment of the affected Lender made in
good faith, be materially disadvantageous to such Lender. Notwithstanding the
foregoing, any Lender's demand for Increased Advance Costs shall not include any
Increased Advance Costs with respect to any period more than 180 days prior to
the date that such Lender gives notice to the Borrower of such Increased Advance
Costs unless the effective date of the condition which results in the right to
receive Increased Advance Costs is retroactive (the "Increased Advance Costs
Retroactive Effective Date"). If any Increased Advance Costs has an Increased
Advance Costs Retroactive Effective Date and any Lender demands compensation
within 180 days after the date setting the Increased Advance Costs Retroactive
Effective Date (the "Increased Advance Costs Set Date"), such Lender shall have
the right to receive such Increased Advance Costs from the Increased Advance
Costs Retroactive Effective Date. If a Lender does not demand such Increased
Advance Costs within 180 days after the Increased Advance Costs Set Date, such
Lender may not receive payment of Increased Advance Costs with respect to any
period more than 180 days prior to such demand.
(b) A certificate of any Lender claiming compensation under this Section
and setting forth the additional amounts to be paid to it hereunder and
calculations therefor shall be
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conclusive in the absence of manifest error. In determining such amount, a
Lender may use any reasonable averaging and attribution methods. If a Lender
demands compensation under this Section, the Borrower may at any time, upon at
least five Business Days' prior notice to the Lender, after reimbursement to the
Lender by the Borrower in accordance with this Section of all costs incurred,
prepay in full the then outstanding LIBOR Advances of the Lender, together with
accrued interest thereon to the date of prepayment, along with any reimbursement
required under Section 2.9 hereof. Concurrently with prepaying such LIBOR
Advances, the Borrower shall borrow a Base Rate Advance from the Lender, and the
Lender shall make such Base Rate Advance, in an amount such that the outstanding
principal amount of the Advances owing to such Lender shall equal the
outstanding principal amount of the Advances owing immediately prior to such
prepayment.
Section 8.4 EFFECT ON BASE RATE ADVANCES. If notice has been given
pursuant to Section 8.1, 8.2 or 8.3 hereof suspending the obligation of a Lender
to make LIBOR Advances, or requiring LIBOR Advances of a Lender to be repaid or
prepaid, then, unless and until the Lender notifies the Borrower that the
circumstances giving rise to such repayment no longer apply, all Advances which
would otherwise be made by such Lender as LIBOR Advances shall be made instead
as Base Rate Advances.
Section 8.5 CAPITAL ADEQUACY. If either (a) the introduction of or any
change in or in the interpretation of any law, rule or regulation or (b)
compliance by a Lender with any law, rule or regulation or any guideline or
request from any central bank or other governmental authority (whether or not
having the force of law) affects or would affect the amount of capital required
or expected to be maintained by a Lender or any corporation controlling such
Lender, and such Lender determines that the amount of such capital is increased
by or based upon the existence of such Lender's Commitment or Advances hereunder
and other commitments or advances of such Lender of this type, then, upon demand
by such Lender, subject to Section 10.9, the Borrower shall immediately pay to
such Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender with respect to such circumstances
(collectively, "Additional Costs"), to the extent that such Lender reasonably
determines in good faith such increase in capital to be allocable to the
existence of such Lender's Commitment hereunder. Notwithstanding the foregoing,
any Lender's demand for Additional Costs shall not include any Additional Costs
with respect to any period more than 180 days prior to the date that such Lender
gives notice to the Borrower of such Additional Costs unless the effective date
of the Regulatory Modification which results in the right to receive Additional
Costs is retroactive (the "Regulatory Modification Retroactive Effective Date").
If any Regulatory Modification has a Regulatory Modification Retroactive
Effective Date and any Lender demands compensation within 180 days after the
date setting the Regulatory Modification Retroactive Effective Date (the
"Regulatory Modification Set Date"), such Lender shall have the right to receive
such Additional Costs from the Regulatory Modification Retroactive Effective
Date. If a Lender does not demand such Additional Costs within 180 days after
the Regulatory Modification Set Date, such Lender may not receive payment of
Additional Costs with respect to any period more than 180 days prior to such
demand. A certificate as to such amounts
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submitted to the Borrower by a Lender hereunder, shall, in the absence of
manifest error, be conclusive and binding for all purposes.
ARTICLE 9
AGREEMENT AMONG LENDERS
Section 9.1 AGREEMENT AMONG LENDERS. The Lenders agree among themselves
that:
(a) ADMINISTRATIVE LENDER. Each Lender hereby appoints the
Administrative Lender as its nominee in its name and on its behalf, to receive
all documents and items to be furnished hereunder; to act as nominee for and on
behalf of all Lenders under the Loan Papers; to, except as otherwise expressly
set forth herein, take such action as may be requested by the Determining
Lenders, provided that, unless and until the Administrative Lender shall have
received such requests, the Administrative Lender may take such administrative
action, or refrain from taking such administrative action, as it may deem
advisable and in the best interests of the Lenders; to arrange the means whereby
the proceeds of the Advances of the Lenders are to be made available to the
Borrower; to distribute promptly to each Lender information, requests and
documents received from the Borrower, and each payment (in like funds received)
with respect to any of such Lender's Advances, fee or other amount; and to
deliver to the Borrower requests, demands, approvals and consents received from
the Lenders. Administrative Lender agrees to promptly distribute to each
Lender, at such Lender's address set forth below information, requests,
documents and payments received from the Borrower.
(b) REPLACEMENT OF ADMINISTRATIVE LENDER. Should the Administrative
Lender or any successor Administrative Lender ever cease to be a Lender
hereunder, or should the Administrative Lender or any successor Administrative
Lender ever resign as Administrative Lender, or should the Administrative Lender
or any successor Administrative Lender ever be removed with cause by the
Determining Lenders, then the Lender appointed by the other Lenders shall
forthwith become the Administrative Lender, and the Borrower and the Lenders
shall execute such documents as any Lender may reasonably request to reflect
such change. If the Administrative Lender also then serves in the capacity of
the Swing Line Bank or the Issuing Bank, such resignation or removal shall
constitute resignation or removal of the Swing Line Bank and the Issuing Bank.
Any resignation or removal of the Administrative Lender or any successor
Administrative Lender shall become effective upon the appointment by the Lenders
of a successor Administrative Lender; provided, however, that if the Lenders
fail for any reason to appoint a successor within 60 days after such removal or
resignation, the Administrative Lender or any successor Administrative Lender
(as the case may be) shall thereafter have no obligation to act as
Administrative Lender hereunder.
(c) EXPENSES. Each Lender shall pay its pro rata share, based on its
Specified Percentage, of any expenses paid by the Administrative Lender directly
and solely in connection with any of the Loan Papers if Administrative Lender
does not receive reimbursement therefor
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from other sources within 60 days after the date incurred, unless payment of
such fees is being diligently disputed by such Lender or the Borrower in good
faith. Any amount so paid by the Lenders to the Administrative Lender shall be
returned by the Administrative Lender pro rata to each paying Lender to the
extent later paid by the Borrower or any other Person on the Borrower's behalf
to the Administrative Lender.
(d) DELEGATION OF DUTIES. The Administrative Lender may execute any
of its duties hereunder by or through officers, directors, employees, attorneys
or agents, and shall be entitled to (and shall be protected in relying upon)
advice of counsel concerning all matters pertaining to its duties hereunder.
(e) RELIANCE BY ADMINISTRATIVE LENDER. The Administrative Lender and
its officers, directors, employees, attorneys and agents shall be entitled to
rely and shall be fully protected in relying on any writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telex or teletype
message, statement, order, or other document or conversation reasonably believed
by it or them in good faith to be genuine and correct and to have been signed or
made by the proper Person and, with respect to legal matters, upon opinions of
counsel selected the Administrative Lender. The Administrative Lender may, in
its reasonable judgment, deem and treat the payee of any Note as the owner
thereof for all purposes hereof.
(f) LIMITATION OF ADMINISTRATIVE LENDER'S LIABILITY. Neither the
Administrative Lender nor any of its officers, directors, employees, attorneys
or agents shall be liable for any action taken or omitted to be taken by it or
them hereunder in good faith and believed by it or them to be within the
discretion or power conferred to it or them by the Loan Papers or be responsible
for the consequences of any error of judgment, except for its or their own gross
negligence or wilful misconduct. Except as aforesaid, the Administrative Lender
shall be under no duty to enforce any rights with respect to any of the
Advances, or any security therefor. The Administrative Lender shall not be
compelled to do any act hereunder or to take any action towards the execution or
enforcement of the powers hereby created or to prosecute or defend any suit in
respect hereof, unless indemnified to its satisfaction against loss, cost,
liability and expense. The Administrative Lender shall not be responsible in
any manner to any Lender for the effectiveness, enforceability, genuineness,
validity or due execution of any of the Loan Papers, or for any representation,
warranty, document, certificate, report or statement made herein or furnished in
connection with any Loan Papers, or be under any obligation to any Lender to
ascertain or to inquire as to the performance or observation of any of the
terms, covenants or conditions of any Loan Papers on the part of the Borrower.
To the extent not reimbursed by the Borrower, each Lender hereby jointly and
severally indemnifies and holds harmless the Administrative Lender, pro rata
according to its Specified Percentage, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses and/or disbursements of any kind or nature whatsoever which may be
imposed on, asserted against, or incurred by the Administrative Lender in any
way with respect to any Loan Papers or any action taken or omitted by the
Administrative Lender under the Loan Papers (including any negligent action of
the Administrative Lender), except to the extent the same result from gross
negligence or wilful misconduct by the Administrative Lender.
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(g) LIABILITY AMONG LENDERS. No Lender shall incur any liability
(other than the sharing of expenses and other matters specifically set forth
herein and in the other Loan Papers) to any other Lender, except for acts or
omissions in bad faith.
(h) RIGHTS AS LENDER. With respect to its commitment hereunder, the
Advances made by it and Note issued to it, the Administrative Lender shall have
the same rights as a Lender and may exercise the same as though it were not the
Administrative Lender, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Administrative Lender in its individual
capacity. The Administrative Lender or any Lender may accept deposits from, act
as trustee under indentures of, and generally engage in any kind of business
with, the Borrower and any of its Affiliates, and any Person who may do business
with or own securities of the Borrower or any of its Affiliates, all as if the
Administrative Lender were not the Administrative Lender hereunder and without
any duty to account therefor to the Lenders.
Section 9.2 LENDER CREDIT DECISION. Each Lender acknowledges that it
has, independently and without reliance upon the Administrative Lender or any
other Lender and based upon the financial statements delivered to such Lender by
the Borrower, and such other 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 Administrative Lender or any other Lender and based
upon such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement and the other Loan Papers.
Section 9.3 BENEFITS OF ARTICLE. None of the provisions of this Article
shall inure to the benefit of any Person other than Lenders; consequently, no
Person shall be entitled to rely upon, or to raise as a defense, in any manner
whatsoever, the failure of the Administrative Lender or any Lender to comply
with such provisions.
ARTICLE 10
MISCELLANEOUS
Section 10.1 NOTICES.
(a) All notices and other communications under this Agreement shall be
in writing and shall be deemed to have been given on the date personally
delivered or sent by telecopy (answerback received), or three days after deposit
in the mail, designated as certified mail, return receipt requested,
postage-prepaid, or one day after being entrusted to a reputable commercial
overnight delivery service, or one day after being delivered to the telegraph
office or sent out by telex addressed to the party to which such notice is
directed at its address determined as provided in this Section. All notices and
other communications under this Agreement shall be given to the parties hereto
at the following addresses:
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(i) If to the Borrower, at:
La Quinta Inns, Inc.
000 X. Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxx 00000
Attn: Xxxxx Xxxxxxxx, Treasurer
(ii) If to the Administrative Lender, at:
NationsBank of Texas, N.A.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxx X. Xxxx, Senior Vice President
(iii) If to a Lender, at its address shown below its name on the
signature pages hereof, or if applicable, set forth in its
Assignment Agreement.
(b) Any party hereto may change the address to which notices shall be
directed by giving 10 days' written notice of such change to the other parties.
Section 10.2 EXPENSES. The Borrower shall promptly pay:
(a) all reasonable out-of-pocket expenses of the Administrative Lender
in connection with the preparation, negotiation, execution and delivery of this
Agreement and the other Loan Papers, the transactions contemplated hereunder and
thereunder, and the making of Advances hereunder, including without limitation
the reasonable fees and disbursements of Special Counsel;
(b) all reasonable out-of-pocket expenses and attorneys' fees of the
Administrative Lender in connection with the administration of the transactions
contemplated in this Agreement and the other Loan Papers and the preparation,
negotiation, execution and delivery of any waiver, amendment or consent by the
Lenders relating to this Agreement or the other Loan Papers; and
(c) all costs, out-of-pocket expenses and attorneys' fees of the
Administrative Lender and each Lender incurred for enforcement, collection,
restructuring, refinancing and "work-out", or otherwise incurred in obtaining
performance under the Loan Papers, and all costs and out-of-pocket expenses of
collection if default is made in the payment of the Notes, which in each case
shall include without limitation fees and expenses of consultants, counsel for
the Administrative Lender and any Lender, and administrative fees for the
Administrative Lender.
Section 10.3 WAIVERS. The rights and remedies of the Lenders under this
Agreement and the other Loan Papers shall be cumulative and not exclusive of any
rights or remedies which they would otherwise have. No failure or delay by the
Administrative Lender or any Lender
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in exercising any right shall operate as a waiver of such right. The Lenders
expressly reserve the right to require strict compliance with the terms of this
Agreement in connection with any funding of a request for an Advance or the
issuance of any Letter of Credit. In the event that any Lender decides to fund
an Advance or the Issuing Bank decides to issue a Letter of Credit at a time
when the Borrower is not in strict compliance with the terms of this Agreement,
such decision by such Lender shall not be deemed to constitute an undertaking by
the Lender to fund any further requests for Advances or the Issuing Bank to
honor any further requests for Letters of Credit or preclude the Lenders from
exercising any rights available under the Loan Papers or at law or equity. Any
waiver or indulgence granted by the Lenders shall not constitute a modification
of this Agreement, except to the extent expressly provided in such waiver or
indulgence, or constitute a course of dealing by the Lenders at variance with
the terms of the Agreement such as to require further notice by the Lenders of
the Lenders' intent to require strict adherence to the terms of the Agreement in
the future. Any such actions shall not in any way affect the ability of the
Administrative Lender or the Lenders, in their discretion, to exercise any
rights available to them under this Agreement or under any other agreement,
whether or not the Administrative Lender or any of the Lenders are a party
thereto, relating to the Borrower.
Section 10.4 DETERMINATION BY THE LENDERS CONCLUSIVE AND BINDING. Any
material determination required or expressly permitted to be made by the
Administrative Lender or any Lender under this Agreement shall be made in its
reasonable judgment and in good faith, and shall when made, absent manifest
error, be conclusive and binding on all parties.
Section 10.5 SET-OFF. In addition to any rights now or hereafter granted
under Applicable Law and not by way of limitation of any such rights, upon the
occurrence of an Event of Default, each Lender and any subsequent holder of any
Note, and any assignee or participant in any Note is hereby authorized by the
Borrower at any time or from time to time, without notice to the Borrower or any
other Person, any such notice being hereby expressly waived, to set-off,
appropriate and apply any deposits (general or special (except trust and escrow
accounts), time or demand, including without limitation Debt evidenced by
certificates of deposit, in each case whether matured or unmatured) and any
other Debt at any time held or owing by such Lender or holder to or for the
credit or the account of the Borrower, against and on account of the Obligations
and other liabilities of the Borrower to such Lender or holder, irrespective of
whether or not (a) the Lender or holder shall have made any demand hereunder, or
(b) the Lender or holder shall have declared the principal of and interest on
the Advances and other amounts due hereunder to be due and payable as permitted
by Section 7.2 and although such obligations and liabilities, or any of them,
shall be contingent or unmatured. Any sums obtained by any Lender or by any
assignee, participant or subsequent holder of any Note shall be subject to pro
rata treatment of all Obligations and other liabilities hereunder.
Section 10.6 ASSIGNMENT.
(a) The Borrower may not assign or transfer any of its rights or
obligations hereunder or under the other Loan Papers without the prior written
consent of the Lenders.
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(b) No Lender shall be entitled to assign its interest in this
Agreement, its Notes or its Advances, except as hereinafter set forth.
(c) With the prior written consent of the Borrower (which consent may be
withheld for any reason or for no reason), a Lender may at any time sell
participations in all or any part of its Advances, its portion of the
Commitment, and all other interests of such Lender under this Agreement and the
other Loan Papers, including but not limited to the Letters of Credit and the
Reimbursement Obligations (collectively, "Participations") to any banks or other
financial institutions ("Participants") provided that such Participation shall
not confer on any Person (other than the parties hereto) any right to vote on,
approve or sign amendments or waivers, or any other independent benefit or any
legal or equitable right, remedy or other claim under this Agreement or any
other Loan Papers, other than the right to vote on, approve, or sign amendments
or waivers or consents with respect to items that would result in (i) any
increase in the commitment of any Participant; or (ii)(A) the extension of the
date of maturity of, or (B) the extension of the due date for any payment of
principal, interest or fees respecting, or (C) the reduction of the amount of
any installment of principal or interest on or the change or reduction of any
mandatory reduction required hereunder, or (D) a reduction of the rate of
interest on, the Advances, the Letters of Credit or the Reimbursement
Obligations, or change in Applicable Margin; or (iii) the release of security
for the Obligations having a value in excess of a Material Amount, including
without limitation any guarantee; or (iv) the reduction of any fees payable
hereunder. Notwithstanding the foregoing, the Borrower agrees that the
Participants shall be entitled to the benefits of Article 8 and Section 10.5
hereof as though they were Lenders and the Lenders may provide copies of all
financial information received from the Borrower to such Participants. To the
fullest extent it may effectively do so under Applicable Law, the Borrower
agrees that any Participant may exercise any and all rights of banker's lien,
set-off and counterclaim with respect to this Participation as fully as if such
Participant were the holder of the Advances in the amount of its Participation.
Notwithstanding anything in this Section 9.6(c) to the contrary, a Lender may
sell Participations to its affiliates without the prior written consent of the
Borrower.
(d) Each Lender may assign to one or more financial institutions or
funds organized under the laws of the United States, or any state thereof, or
under the laws of any other country that is a member of the Organization for
Economic Cooperation and Development, or a political subdivision of any such
country, which is engaged in making, purchasing or otherwise investing in
commercial loans in the ordinary course of its business (each, an "Assignee")
its rights and obligations under this Agreement and the other Loan Papers;
PROVIDED, HOWEVER, that (i) except as otherwise provided herein, each such
assignment shall be subject to the prior written consent of the Administrative
Lender and the Borrower (which consent shall not be unreasonably withheld), (ii)
each such assignment shall be of a constant, and not a varying, percentage of
the Lender's rights and obligations under this Agreement and the Facility B
Credit Agreement, (iii) the amount of the Commitment and Advances being assigned
pursuant to each such assignment (determined as of the date of the assignment
with respect to such assignment), together with the amount of the commitment and
advances being assigned pursuant to the Facility B Credit Agreement, shall in no
event be less than $10,000,000, (iv) the applicable
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Lender, Administrative Lender and applicable Assignee shall execute and deliver
to the Administrative Lender an Assignment and Acceptance Agreement (an
"Assignment Agreement") in substantially the form of EXHIBIT E hereto,
together with the Notes subject to such assignment, (v) the Assignee or the
Lender executing the Assignment as the case may be, shall deliver to the
Administrative Lender a processing fee of $3,500 (for both this Agreement and
the Facility B Credit Agreement), and (vi) the Administrative Lender shall give
the Borrower notice of any proposed assignment no later than 5 days prior to any
assignment by any Lender. Upon such execution, delivery and acceptance from and
after the effective date specified in each Assignment, which effective date
shall be at least three Business Days after the execution thereof, (a) the
Assignee thereunder shall be party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment, have
the rights and obligations of a Lender hereunder and (b) the assigning Lender
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment, relinquish such rights and be released from such
obligations under this Agreement. Notwithstanding anything in this clause (d)
to the contrary, any Lender may assign its rights and obligations under this
Agreement to an affiliate of such Lender without the prior written consent of
the Administrative Lender and the Borrower, but otherwise subject to the
restrictions set forth herein.
(e) Notwithstanding anything in clause (d) above to the contrary, any
Lender may assign and pledge all or any portion of its Advances and Notes to any
Federal Reserve Bank as collateral security pursuant to Regulation A of F.R.S.
Board and any Operating Circular issued by such Federal Reserve Bank; provided,
however, that no such assignment under this clause (e) shall release the
assignor Lender from its obligations hereunder.
(f) Upon its receipt of an Assignment Agreement executed by a Lender and
an Assignee, and any Note subject to such assignment, the Borrower shall, within
three Business Days after its receipt of such Assignment Agreement, at its own
expense, execute and deliver to the Administrative Lender in exchange for the
surrendered Note a new Note to the order of such Assignee in an amount equal to
the portion of the Advances and Commitment assigned to it pursuant to such
Assignment Agreement and a new Note to the order of the assigning Lender in an
amount equal to the portion of the Advances and Commitment retained by it
hereunder. Such new Notes shall be in an aggregate principal amount equal to
the aggregate principal amount of such surrendered Note, shall be dated the
effective date of such Assignment Agreement and shall otherwise be in
substantially the form of EXHIBIT A hereto.
(g) Any Lender may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 10.6, disclose
to the assignee or Participant or proposed assignee or participant, any
information relating to the Borrower furnished to such Lender by or on behalf of
the Borrower.
(h) Except as specifically set forth in this Section 10.6, nothing in
this Agreement or any other Loan Papers, expressed or implied, is intended to or
shall confer on any Person other than the respective parties hereto and thereto
and their successors and assignees permitted
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hereunder and thereunder any benefit or any legal or equitable right, remedy or
other claim under this Agreement or any other Loan Papers.
(i) Notwithstanding anything in this Section 10.6 to the contrary, no
Assignee or Participant shall be entitled to receive any greater payment under
Section 2.15 or Section 8.3 than such assigning or participating Lender would
have been entitled to receive with respect to the interest assigned or
participated to such Assignee or Participant.
Section 10.7 COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
Section 10.8 SEVERABILITY. Any provision of this Agreement which is for
any reason prohibited or found or held invalid or unenforceable by any court or
governmental agency shall be ineffective to the extent of such prohibition or
invalidity or unenforceability without invalidating the remaining provisions
hereof in such jurisdiction or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 10.9 INTEREST AND CHARGES. It is not the intention of any
parties to this Agreement to make an agreement in violation of the laws of any
applicable jurisdiction relating to usury. Regardless of any provision in any
Loan Papers, no Lender shall ever be entitled to receive, collect or apply, as
interest on the Obligations, any amount in excess of the Maximum Amount. If any
Lender or participant ever receives, collects or applies, as interest, any such
excess, such amount which would be excessive interest shall be deemed a partial
repayment of principal and treated hereunder as such; and if principal is paid
in full, any remaining excess shall be paid to the Borrower. In determining
whether or not the interest paid or payable, under any specific contingency,
exceeds the Maximum Amount, the Borrower and the Lenders shall, to the maximum
extent permitted under Applicable Law, (a) characterize any nonprincipal payment
as an expense, fee or premium rather than as interest, (b) exclude voluntary
prepayments and the effect thereof, and (c) amortize, prorate, allocate and
spread in equal parts, the total amount of interest throughout the entire
contemplated term of the Obligations so that the interest rate is uniform
throughout the entire term of the Obligations; provided, however, that if the
Obligations are paid and performed in full prior to the end of the full
contemplated term thereof, and if the interest received for the actual period of
existence thereof exceeds the Maximum Amount, the Lenders shall refund to the
Borrower the amount of such excess or credit the amount of such excess against
the total principal amount of the Obligations owing, and, in such event, the
Lenders shall not be subject to any penalties provided by any laws for
contracting for, charging or receiving interest in excess of the Maximum Amount.
This Section shall control every other provision of all agreements pertaining to
the transactions contemplated by or contained in the Loan Papers.
Section 10.10 CONFIDENTIALITY. Each Lender and the Administrative Lender
agrees (on behalf of itself and each of its affiliates, directors, officers,
employees and representatives) to use reasonable precautions to keep
confidential, in accordance with customary procedures for
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confidential information of this nature and in accordance with safe and sound
banking practices, any non-public information supplied to it by the Borrower
pursuant to this Agreement which is identified by the Borrower as being
confidential at the time the same is delivered to the Lenders or the
Administrative Lender, provided that nothing herein shall limit the disclosure
of any such information (a) to the extent required by statute, rule, regulation
or judicial process, (b) to counsel for any Lender or the Administrative Lender,
(c) to bank examiners, auditors or accountants of any Lender, (d) to the
Administrative Lender or any other Lender, (e) in connection with any litigation
to which any one or more of Lenders is a party, provided, further, that, unless
specifically prohibited by Applicable Law or court order, each Lender shall,
prior to disclosure thereof, notify the Borrower of any request for disclosure
of any such non-public information (i) by any governmental agency or
representative thereof (other than any such request in connection with an
examination of such Lender's financial condition by such governmental agency) or
(ii) pursuant to legal process, or (f) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first executes and delivers to the
respective Lender an agreement (a "Confidentiality Agreement") in substantially
the form of EXHIBIT F hereto; and provided finally that in no event shall any
Lender or the Administrative Lender by obligated or required to return any
materials furnished by the Borrower.
Section 10.11 HEADINGS. Headings used in this Agreement are for
convenience only and shall not be used in connection with the interpretation of
any provision hereof.
Section 10.12 AMENDMENT AND WAIVER. The provisions of this Agreement may
not be amended, modified or waived except by the written agreement of the
Borrower and the Determining Lenders; provided, however, that no such amendment,
modification or waiver shall be made (a) without the consent of all Lenders, if
it would (i) increase the Specified Percentage or commitment of any Lender, or
(ii) extend the date of maturity of, extend the due date for any payment of
principal or interest on, reduce the amount of any installment of principal or
interest on, or reduce the rate of interest on, any Advance, the Reimbursement
Obligations or other amount owing under any Loan Papers, or (iii) release any
security for or guaranty of the Obligations (except pursuant to this Agreement),
or (iv) reduce the fees payable hereunder, or (v) revise this Section 10.12, or
(vi) waive the date for payment of any of the Obligations, or (vii) amend the
definition of Determining Lenders; or (b) without the consent of the
Administrative Lender, if it would alter the rights, duties or obligations of
the Administrative Lender. Neither this Agreement nor any term hereof may be
amended orally, nor may any provision hereof be waived orally but only by an
instrument in writing signed by the Administrative Lender and, in the case of an
amendment, by the Borrower.
Section 10.13 EXCEPTION TO COVENANTS. Neither the Borrower nor any
Subsidiary shall be deemed to be permitted to take any action or fail to take
any action which is permitted as an exception to any of the covenants contained
herein or which is within the permissible limits of any of the covenants
contained herein if such action or omission would result in the breach of any
other covenant contained herein.
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Section 10.14 NO LIABILITY OF ISSUING BANK. The Borrower assumes all
risks of the acts or omissions of any beneficiary or transferee of any Letter of
Credit with respect to its use of such Letter of Credit. Neither the Issuing
Bank nor any Lender nor any of their respective officers or directors shall be
liable or responsible for: (a) the use that may be made of any Letter of Credit
or any acts or omissions of any beneficiary or transferee in connection
therewith; (b) the validity, sufficiency or genuineness of documents, or of any
endorsement thereon, even if such documents should prove to be in any or all
respects invalid, insufficient, fraudulent or forged; (c) payment by the Issuing
Bank against presentation of documents that do not comply with the terms of a
Letter of Credit, including failure of any documents to bear any reference or
adequate reference to the Letter of Credit, except for any payment made upon the
Issuing Bank's gross negligence or willful misconduct; or (d) any other
circumstances whatsoever in making or failing to make payment under any Letter
of Credit, EXCEPT that the Borrower shall have a claim against the Issuing
Bank, and the Issuing Bank shall be liable to the Borrower, to the extent of any
direct, but not consequential, damages suffered by the Borrower that the
Borrower proves were caused by (i) the Issuing Bank's willful misconduct or
gross negligence in determining whether documents presented under any Letter of
Credit comply with the terms of the Letter of Credit or (ii) the Issuing Bank's
willful failure to make lawful payment under a Letter of Credit after the
presentation to it of a draft and certificates strictly complying with the terms
and conditions of the Letter of Credit. In furtherance and not in limitation of
the foregoing, the Issuing Bank may accept documents that appear on their face
to be in order, without responsibility for further investigation, regardless of
any notice or information to the contrary.
Section 10.15 TERMINATION OF PARTICIPATIONS IN BOND LETTERS OF CREDIT.
Upon satisfaction of all conditions set forth in Section 3.1 hereof, any
obligation of any Lender to participate in the Bond Letters of Credit shall
automatically terminate without any further action being taken with respect
thereto.
Section 10.16 TERMINATION OF COMMITMENT. The Commitment shall terminate
on December 31, 1995 if the conditions precedent set forth in Sections 3.1 and
3.2 have not been satisfied by such date.
SECTION 10.17 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN PAPERS
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE
OF TEXAS; PROVIDED, HOWEVER, THAT PURSUANT TO ARTICLE 5069-15.10(b), TITLE
79, REVISED CIVIL STATUTES OF TEXAS, 1925, AS AMENDED, IT IS AGREED THAT THE
PROVISIONS OF CHAPTER 15, TITLE 79, REVISED CIVIL STATUTES OF TEXAS, 1925, AS
AMENDED, SHALL NOT APPLY TO THE ADVANCES, THIS AGREEMENT AND THE OTHER LOAN
PAPERS. WITHOUT EXCLUDING ANY OTHER JURISDICTION, THE BORROWER AGREES THAT
THE STATE AND FEDERAL COURTS OF TEXAS LOCATED IN DALLAS, TEXAS SHALL HAVE
JURISDICTION OVER PROCEEDINGS IN CONNECTION WITH THIS AGREEMENT AND THE OTHER
LOAN PAPERS.
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SECTION 10.18 WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
ADMINISTRATIVE LENDER AND THE LENDERS HEREBY KNOWINGLY VOLUNTARILY,
IRREVOCABLY AND INTENTIONALLY WAIVE, TO THE MAXIMUM EXTENT PERMITTED BY LAW,
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM ARISING OUT OF
OR RELATED TO THIS AGREEMENT OR ANY OF THE OTHER LOAN PAPERS OR THE
TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY. THIS PROVISION IS A MATERIAL
INDUCEMENT TO EACH LENDER ENTERING INTO THIS AGREEMENT AND MAKING ANY
ADVANCES HEREUNDER.
SECTION 10.19 ENTIRE AGREEMENT. THIS WRITTEN AGREEMENT, TOGETHER WITH
THE OTHER LOAN PAPERS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
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REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
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IN WITNESS WHEREOF, this Credit Agreement is executed as of the date first
set forth above.
BORROWER: LA QUINTA INNS, INC.
By:_______________________________
Name:_________________________
Title:________________________
ADMINISTRATIVE LENDER: NATIONSBANK OF TEXAS, N.A.,
as Administrative Lender
By:_______________________________
Xxxxxxx X. Xxxx
Senior Vice President
LENDERS: NATIONSBANK OF TEXAS, N.A.,
as a Lender
Specified Percentage:
16.0%
By:_______________________________
Xxxxxxx X. Xxxx
Senior Vice President
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxx X. Xxxx
Senior Vice President
- 81 -
CITIBANK, N.A.
Specified Percentage:
14.0%
By:_______________________________
Name:_________________________
Title:________________________
000 Xxxx Xxxxxx
0xx Xxxxx, Xxxx 6
New York, New York 10043
Attn: Xxxxx XxXxxxxx
- 82 -
THE FROST NATIONAL BANK
Specified Percentage:
8.0%
By:_______________________________
Name:_________________________
Title:________________________
000 Xxxx Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxx Xxxxxx
- 83 -
TEXAS COMMERCE BANK NATIONAL
ASSOCIATION
Specified Percentage:
10.0%
By:_______________________________
Name:_________________________
Title:________________________
0000 X.X. Xxxx 000
Xxx Xxxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxx
Vice President
- 84 -
BANK OF AMERICA ILLINOIS
Specified Percentage:
14.0%
By:_______________________________
Name:_________________________
Title:________________________
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: W. Xxxxxx Xxxxxxx
Vice President
- 85 -
FIRST INTERSTATE BANK OF TEXAS,
N.A.
Specified Percentage:
14.0%
By:_______________________________
Name:_________________________
Title:________________________
000 X. Xx. Xxxx'x Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxxx
- 00 -
XXXXXX XXXXXX NATIONAL BANK OF
OREGON
Specified Percentage:
8.0%
By:_______________________________
Name:_________________________
Title:________________________
000 Xxxxxxxxx Xxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx 00000
Attn: Xxxxx X. Xxxxxxx
Vice President
- 87 -
XXXXX FARGO BANK, N.A.
Specified Percentage:
8.0%
By:_______________________________
Name:_________________________
Title:________________________
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxxx Xxxxxxxxx
with a copy to:
0000 Xxxxxxx Xxxxx
000 Xxxxx Xxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxx X. Xxxxx
Vice President
- 88 -
SOCIETE GENERALE, SOUTHWEST
AGENCY
Specified Percentage:
8.0%
By:_______________________________
Name:_________________________
Title:________________________
0000 Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxx X. Xxxxx
Vice President
- 89 -
EXHIBIT A
REVOLVING CREDIT NOTE
Dallas, Texas $__________ September 12, 0000
XX XXXXXX INNS, INC., a Texas corporation (the "Borrower"), for value
received, promises to pay to the order of _______________________ ("Lender"),
at the principal office of _________________________________, in lawful money
of the United States of America, the principal sum of _______________________
DOLLARS ($________), or such lesser sum as shall be due and payable from time
to time hereunder, as hereinafter provided. All terms used but not defined
herein shall have the meanings set forth in the Credit Agreement described
below.
The Borrower promises to pay principal of and interest on the unpaid
principal balance of Revolving Credit Advances under this Revolving Credit
Note from time to time outstanding as set forth in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to NationsBank of Texas, N.A., as Administrative Lender for
the Lenders, at 000 Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000, in immediately
available funds.
This Revolving Credit Note is issued pursuant to and evidences Revolving
Credit Advances under an Amended and Restated Credit Agreement (Facility A),
dated as of September 12, 1995, among the Borrower, NationsBank of Texas,
N.A., as Administrative Lender, and the lenders parties thereto (as amended,
restated, supplemented, renewed, extended or otherwise modified from time to
time, "Credit Agreement"), to which reference is made for a statement of the
rights and obligations of the Lender and the duties and obligations of the
Borrower in relation thereto; but neither this reference to the Credit
Agreement nor any provision thereof shall affect or impair the absolute and
unconditional obligation of the Borrower to pay the principal sum of and
interest on this Revolving Credit Note when due.
The Borrower and all endorsers, sureties and guarantors of this Revolving
Credit Note hereby severally waive demand, presentment for payment, protest,
notice of protest, notice of acceleration, notice of intention to accelerate
the maturity of this Revolving Credit Note, and all other notices of any
kind, diligence in collecting, the bringing of any suit against any party and
any notice of or defense on account of any extensions, renewals, partial
payments or changes in any manner of or in this Revolving Credit Note or in
any of its terms, provisions and covenants, or any release or substitutions
of any security, or any delay, indulgence or other act of any trustee or any
holder hereof, whether before or after maturity.
THIS REVOLVING CREDIT NOTE, TOGETHER WITH THE OTHER LOAN PAPERS,
REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.
LA QUINTA INNS, INC.
By:
-----------------------------------
Title:
-----------------------------
-2-
EXHIBIT B
BID RATE NOTE
U.S. $200,000,000 Dated: September 12, 1995
FOR VALUE RECEIVED, the undersigned, LA QUINTA INNS, INC., a Texas
corporation, (the "Borrower"), HEREBY PROMISES TO PAY to the order of
____________________ (the "Lender") the lesser of TWO HUNDRED MILLION AND
NO/100 Dollars ($200,000,000) and the unpaid principal amount of the Bid Rate
Advances (as defined in the Credit Agreement referred to below) made by the
Lender to the Borrower pursuant to the Credit Agreement, payable at such
times, and in such amounts, as are agreed to by the Lender and the Borrower
pursuant to Section 2.2(i) of the Credit Agreement.
The Borrower promises to pay interest on the unpaid principal amount of
the Bid Rate Advances from the date made until such principal amount is paid
in full, at such interest rates, and payable at such times, as are agreed to
by the Lender and the Borrower pursuant to Section 2.2(i) of the Credit
Agreement.
Both principal and interest are payable in lawful money of the United
States of America to NationsBank of Texas, N.A., as Administrative Lender for
the Lender, at 000 Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000 in immediately available
funds.
This Bid Rate Note is one of the Bid Rate Notes referred to in, and is
entitled to the benefits of, the Amended and Restated Credit Agreement
(Facility A), dated as of September 12, 1995, among the Borrower, the Lender
and certain other banks parties thereto, and NationsBank of Texas, N.A., as
Administrative Lender for the Lender and such other banks (as from time to
time amended, modified or supplemented, the "Credit Agreement"). The Credit
Agreement, among other things, contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events and also for
prepayments on account of principal hereof prior to the maturity hereof upon
the terms and conditions therein specified; but neither this reference to the
Credit Agreement nor any provision thereof shall affect or impair the
absolute and unconditional obligation of the Borrower to pay the principal
sum of and interest on this Bid Rate Note when due.
The Borrower and all endorsers, sureties and guarantors of this Bid Rate
Note hereby severally waive demand, presentment for payment, protest, notice
of protest, notice of acceleration, notice of intention to accelerate the
maturity of this Bid Rate Note, and all other notices of any kind, diligence
in collecting, the bringing of any suit against any party and any notice of
or defense on account of any extensions, renewals, partial payments or
changes in any manner of or in this Bid Rate Note or in any of its terms,
provisions and covenants, or any releases or substitutions of any security,
or any delay, indulgence or other act of any trustee or any holder hereof,
whether before or after maturity.
THIS BID RATE NOTE, TOGETHER WITH THE OTHER LOAN PAPERS, REPRESENTS THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES
HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
LA QUINTA INNS, INC.
By:
-----------------------------------
Title:
-----------------------------
-2-
EXHIBIT C
SWING LINE NOTE
U.S. $10,000,000.00 Dated: September 12, 1995
FOR VALUE RECEIVED, the undersigned, LA QUINTA INNS, INC., a Texas
corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
NATIONSBANK OF TEXAS, N.A. (the "Swing Line Bank") for the account of its
Lending Office (as defined in the Credit Agreement referred to below) the
lesser of TEN MILLION AND NO/100 Dollars ($10,000,000) and the unpaid
principal amount of the Swing Line Advances (as defined in the Credit
Agreement referred to below) made by the Swing Line Bank to the Borrower
pursuant to the Credit Agreement, payable at such times, and in such amounts,
as are specified in the Credit Agreement.
The Borrower promises to pay interest on the unpaid principal amount of
the Swing Line Advances from the date made until such principal amount is
paid in full, at such interest rates, and payable at such times, as are
specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to NationsBank of Texas, N.A., as Administrative Lender for
the Swing Line Bank, at NationsBank Plaza, 000 Xxxx Xxxxxx, Xxxxxx, Xxxxx
00000 in immediately available funds.
This Swing Line Note is the Swing Line Note referred to in, and is
entitled to the benefits of, the Amended and Restated Credit Agreement
(Facility A), dated as of September 12, 1995, among La Quinta Inns, Inc., the
Swing Line Bank and certain other banks parties thereto, and NationsBank of
Texas, N.A., as Administrative Lender for the Swing Line Bank and such other
banks (as from time to time amended, modified or supplemented, the "Credit
Agreement"). The Credit Agreement, among other things, contains provisions
for acceleration of the maturity hereof upon the happening of certain stated
events and also for prepayments on account of principal hereof prior to the
maturity hereof upon the terms and conditions therein specified; but neither
this reference to the Credit Agreement nor any provision thereof shall affect
or impair the absolute and unconditional obligation of the Borrower to pay
the principal sum of and interest on their Swing Line Note when due.
The Borrower and all endorsers, sureties and guarantors of this Swing
Line Note hereby severally waive demand, presentment for payment, protest,
notice of protest, notice of acceleration, notice of intention to accelerate
the maturity of this Swing Line Note, and all other notices of any kind,
diligence in collecting, the bringing of any suit against any party and any
notice of or defense on account of any extensions, renewals, partial payments
or changes in any manner of or in this Swing Line Note or in any of its
terms, provisions and covenants, or any releases or substitutions of any
security, or any delay, indulgences or other act of any trustee or any holder
hereof, whether before or after maturity.
THIS SWING LINE NOTE, TOGETHER WITH THE OTHER LOAN PAPERS, REPRESENTS
THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
LA QUINTA INNS, INC.
By:
---------------------------------
Title:
---------------------------
EXHIBIT D
GUARANTY
This Guaranty, dated as of September 12, 1995 (this "GUARANTY"), is made
by the entities listed on the signature pages hereof (all such entities being
collectively called the "GUARANTORS").
BACKGROUND.
1. La Quinta Inns, Inc., a Texas corporation ("COMPANY"), NationsBank
of Texas, N.A., as Administrative Lender ("ADMINISTRATIVE LENDER") on behalf
of NationsBank of Texas, N.A. and each other lender, and each other lender
(singly, a "LENDER" and collectively, the "LENDERS") have entered into the
Amended and Restated Credit Agreement (FACILITY A), dated as of September 12,
1995 (as hereafter amended or otherwise modified from time to time, the "CREDIT
AGREEMENT"). The capitalized terms not otherwise defined herein have the
meanings specified in the Credit Agreement.
2. Pursuant to the Credit Agreement, Company may, subject to the terms
of the Credit Agreement and the other Loan Papers, request that Lenders make
Advances and issue, or participate in the issuance of, Letters of Credit.
3. It is a condition precedent to the obligation of Lenders to make
such Advances and issue, or participate in the issuance of, Letters of Credit
that Guarantors guarantee repayment thereof upon the terms and conditions set
forth herein.
4. In the case of each Guarantor which is a corporation, the Board of
Directors of each such Guarantor, and in the case of each Guarantor which is
a partnership or joint venture, the Board of Directors of each corporation
which is a partner or a joint venture of such Guarantor, have determined that
the execution, delivery, and performance of this Guaranty is necessary and
convenient to the conduct, promotion, and attainment of such Guarantor's
business and that such Guaranty may reasonably be expected to benefit,
directly or indirectly, such Guarantor.
5. Guarantors desire to induce Lender to make such Advances and issue,
or participate in the issuance of, Letters of Credit.
AGREEMENT.
Now, therefore, in consideration of the premises and in order to induce
Lenders to make Advances and issue, or participate in the issuance of,
Letters of Credit under the Credit Agreement, Guarantors agree as follows:
1. GUARANTY.
(a) Each Guarantor, jointly and severally, hereby unconditionally
and irrevocably guarantees the punctual payment of, and promises to pay,
when due, whether at stated maturity, by mandatory prepayment, by
acceleration or otherwise, all obligations, indebtedness and liabilities,
and all rearrangements, renewals and extensions of all or any part thereof,
of Company or any other Obligor now or hereafter arising from, by virtue of
or pursuant to the Credit Agreement, the Notes, any other Loan Paper, and
any and all renewals and extensions thereof, or any part thereof, or future
amendments thereto, whether for principal, interest (including, without
limitation, interest, fees and other charges that would accrue or become
owing both prior to and subsequent to and but for the commencement of any
proceeding against or with respect to Company or any other Obligor under
any chapter of the Bankruptcy Code of 1978, 11 U.S.C. Section 101 ET SEQ.
whether or not a claim is allowed for the same in any such proceeding),
premium, fees, commissions, expenses or otherwise (such obligations being
the "OBLIGATION"), and agrees to pay any and all reasonable expenses
(including reasonable counsel fees and expenses) incurred in enforcement
or collection of all or any part thereof, whether such obligations,
indebtedness and liabilities are direct, indirect, fixed, contingent,
joint, several or joint and several, and any rights under this Guaranty.
(b) Anything contained in this Guaranty to the contrary
notwithstanding, the obligations of each Guarantor hereunder shall be
limited to a maximum aggregate amount equal to the largest amount that
would not render its obligations hereunder subject to avoidance as a
fraudulent transfer or conveyance under Section 548 of Title 11 of the
United States Code or any applicable provisions of comparable state law
(collectively, the "FRAUDULENT TRANSFER LAWS"), in each case after giving
effect to all other liabilities of Guarantor, contingent or otherwise, that
are relevant under the Fraudulent Transfer Laws (specifically excluding,
however, any liabilities of such Guarantor in respect of intercompany
indebtedness to Company, other Affiliates of Company or other Obligors to
the extent that such indebtedness would be discharged in an amount equal to
the amount paid by such Guarantor hereunder) and after giving effect as
assets, subject to PARAGRAPH 4(a) hereof, to the value (as determined under
the applicable provisions of Fraudulent Transfer Laws) of any rights to
subrogation or contribution of such Guarantor pursuant to (i) Applicable
Law or (ii) any agreement providing for an equitable allocation among such
Guarantor and other Obligors of obligations arising under guaranties by
such parties.
2. GUARANTY ABSOLUTE. Each Guarantor guarantees that Obligation will
be paid strictly in accordance with the terms of the Credit Agreement, the
Notes, and the other Loan Papers, regardless of any Applicable Law,
regulation or order now or hereafter in effect in any jurisdiction affecting
any of such terms or the rights of Administrative Lender or any Lender with
respect thereto; PROVIDED, HOWEVER, nothing contained in this Guaranty shall
require any Guarantor to make any payment under this Guaranty in violation of
any Applicable Law, regulation or order now or hereafter in effect. The
obligations and liabilities of each Guarantor
-2-
hereunder are independent of the obligations of Company under the Credit
Agreement and of the obligations of each other Obligor under each other Loan
Paper and any Applicable Law. The liability of each Guarantor under this
Guaranty shall be absolute and unconditional irrespective of:
(a) the taking or accepting of any other security or guaranty for any
or all of the Obligation;
(b) any increase, reduction or payment in full at any time or from
time to time of any part of the Obligation, including any increase,
reduction or termination of the Commitment;
(c) any lack of validity or enforceability of the Credit Agreement,
the Notes, or any other Loan Paper or other agreement or instrument
relating thereto, including but not limited by the unenforceability of
all or any part of the Obligation by reason of the fact that (i) the
Obligation, and/or the interest paid or payable with respect thereto,
exceeds the amount permitted by Applicable Law, (ii) the act of creating
the Obligation, or any part thereof, is ULTRA XXXXX, (iii) the officers
creating same acted in excess of their authority, or (iv) for any other
reason;
(d) any lack of corporate, partnership or other power of Company, any
Obligor or any other Person;
(e) any Debtor Relief Law involving Company, any Guarantor, any
Obligor or any other Person;
(f) any renewal, compromise, extension, acceleration or other change
in the time, manner or place of payment of, or in any other term of, all
or any of the Obligation; any adjustment, indulgence, forbearance, or
compromise that may be granted or given by any Lender or Administrative
Lender to Company, any Guarantor or any other Obligor; or any other
modification, amendment, or waiver of or any consent to departure from
the Credit Agreement, the Notes, or any other Loan Paper or other agreement
or instrument relating thereto without notification of any Guarantor (the
right to such notification being herein specifically waived by each
Guarantor);
(g) any exchange, release, sale, subordination, or non-perfection of
any collateral or Lien thereon or any lack of validity or enforceability or
change in priority, destruction, reduction, or loss or impairment of value
of any collateral or Lien thereon;
(h) any release or amendment or waiver of or consent to departure from
any other guaranty for all or any of the Obligation;
(i) the failure by any Lender or Administrative Lender to make any
demand upon or to bring any legal, equitable, or other action against the
Company or any other
-3-
Person (including without limitation any Guarantor or any other Obligor),
or the failure or delay by any Lender or Administrative Lender to, or the
manner in which any Lender or Administrative Lender shall, proceed to
exhaust rights against any direct or indirect security for the Obligation;
(j) the existence of any claim, defense, set-off, or other rights
which Company or Guarantor may have at any time against Company, any
Lender, Administrative Lender, any Guarantor or any other Obligor, or any
other Person, whether in connection with this Guaranty, the Loan Papers,
the transactions contemplated thereby, or any other transaction;
(k) any failure of any Lender or Administrative Lender to notify any
Guarantor of any renewal, extension, or assignment of the Obligation or
any part thereof, or the release of any security, or of any other action
taken or refrained from being taken by any Lender or Administrative Lender,
it being understood that Lenders and Administrative Lender shall not be
required to give any Guarantor any notice of any kind under any
circumstances whatsoever with respect to or in connection with the
Obligation;
(l) any payment by Company to any Lender or Administrative Lender is
held to constitute a preference under any Debtor Relief Law or if for any
other reason any Lender or Administrative Lender is required to refund
such payment or pay the amount thereof to another Person; or
(m) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, Company, any Guarantor or any
other Obligor, including without limitation any defense by reason of any
disability or other defense of Company, or the cessation from any cause
whatsoever of the liability of Company, or any claim that Guarantor's
obligations hereunder exceed or are more burdensome than those of Company
or any other Obligor.
This Guaranty shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the Obligation is rescinded or
must otherwise be returned by any Lender or any other Person upon the
insolvency, bankruptcy or reorganization of Company, any Guarantor, any other
Obligor or otherwise, all as though such payment had not been made.
3. WAIVER. To the extent not prohibited by Applicable Law, each
Guarantor hereby waives: (a) promptness, protest, diligence, presentments,
acceptance, performance, demands for performance, notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this
Guaranty and notices of the existence, creation or incurrence of new or
additional indebtedness, and any of the events described in SECTION 2 and of
any other occurrence or matter with respect to any of the Obligation, this
Guaranty or any of the other Loan Papers; (b) any requirement that
Administrative Lender or any Lender protect, secure, perfect, or insure any
Lien or security interest or any property subject thereto or exhaust any
right or take any action against Company, any Guarantor, any other Obligor or
any other Person or any collateral
-4-
or pursue any other remedy in Administrative Lender's or any Lender's power
whatsoever; (c) any right to assert against Administrative Lender or any
Lender as a counterclaim, set-off or cross-claim, any counterclaim, set-off
or claim which it may now or hereafter have against Administrative Lender,
any Lender, Company, any Guarantor or any other Obligor, (d) any right to
seek or enforce any remedy or right that Administrative Lender or any Lender
now has or may hereafter have against Company, any Guarantor, any other
Obligor or any other Person (to the extent permitted by Applicable Law);
(e) any right to participate in any collateral or any right benefiting
Administrative Lender or Lenders in respect of the Obligation; and (f) any
right by which it might be entitled to require suit on an accrued right of
action in respect of any of the Obligation or require suit against Company,
any Guarantor, any other Obligor or any other Person, whether arising
pursuant to Section 34.02 of the Texas Business and Commerce Code, as
amended, Section 17.001 of the Texas Civil Practice and Remedies Code, as
amended, Rule 31 of the Texas Rules of Civil Procedure, as amended, or
otherwise.
4. SUBROGATION AND SUBORDINATION.
(a) Notwithstanding any reference to subrogation contained herein to
the contrary, each Guarantor hereby irrevocably waives any claim or other
rights which it may have or hereafter acquire against Company or any other
Obligor that arise from the existence, payment, performance or enforcement
of such Guarantor's obligations under this Guaranty, including, without
limitation, any right of subrogation, reimbursement, exoneration,
contribution, indemnification, any right to participate in any claim or
remedy of any Lender or Administrative Lender against Company, any Guarantor
or any other Obligor or any collateral which any Lender or Administrative
Lender now has or hereafter acquires, whether or not such claim, remedy or
right arises in equity, or under contract, statutes or common law, including
without limitation, the right to take or receive from Company, any Guarantor
or any other Obligor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security on account of such claim
or other rights. If any amount shall be paid to any Guarantor in violation
of the preceding sentence and the Obligation shall not have been paid in
full, such amount shall be deemed to have been paid to such Guarantor for the
benefit of, and held in trust for the benefit of, Lenders, and shall
forthwith be paid to Administrative Lender to be credited and applied upon
the Obligation, whether matured or unmatured, in accordance with the terms of
the Credit Agreement. Each Guarantor acknowledges that it will receive
direct and indirect benefits from the financing arrangements contemplated by
the Credit Agreement and that the waiver set forth in this PARAGRAPH 4(a) is
knowingly made in contemplation of such benefit.
(b) If any Guarantor becomes the holder of any indebtedness payable by
Company, any Guarantor or any other Obligor, such Guarantor hereby
subordinates all indebtedness owing to it from Company, any Guarantor and
each other Obligor to all indebtedness of Company, any Guarantor and each
other Obligor to Lenders and Administrative Lender, and agrees that upon the
occurrence and continuance of a Default or an Event of Default, it shall not
accept any payment on the same until final payment in full of the obligations
of Company under the Credit Agreement, the Notes and all other Loan Papers,
and shall in no circumstance whatsoever
-5-
attempt to set-off or reduce any obligations hereunder because of such
indebtedness. If any amount shall nevertheless be paid to such Guarantor by
Company, any Guarantor or any other Obligor prior to payment in full of the
Obligation, such amount shall be held in trust for the benefit of Lenders and
Administrative Lender and shall forthwith be paid to Administrative Lender to
be credited and applied to the Obligation, whether matured or unmatured.
5. REPRESENTATIONS AND WARRANTIES. Each Guarantor hereby represents
and warrants that all representations and warranties as they apply to such
Guarantor only set forth in ARTICLE 4 of the Credit Agreement (each of which
is hereby incorporated by reference) are true and correct. Furthermore, each
Guarantor represents that it is Solvent.
6. COVENANTS. Each Guarantor hereby expressly assumes, confirms, and
agrees to perform, observe, and be bound by all conditions and covenants set
forth in the Credit Agreement, to the extent applicable to it, as if it were a
signatory thereto. Each Guarantor further covenants and agrees (a) punctually
and properly to perform all of such Guarantor's covenants and duties under
all other Loan Papers; (b) from time to time promptly to furnish
Administrative Lender with any information or writings which Administrative
Lender may request concerning this Guaranty; and (c) promptly to notify
Administrative Lender of may claim, action, or proceeding affecting this
Guaranty.
7. AMENDMENTS, ETC. No amendment or waiver of any provision of this
Guaranty nor consent to any departure by any Guarantor therefrom shall in any
event be effective unless the same shall be in writing and signed by such
Guarantor, Administrative Lender, and, either all Lenders or Determining
Lenders, as appropriate, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
8. ADDRESSES FOR NOTICES. Unless otherwise provided herein, all
notices, requests, consents and demands shall be in writing and shall be
delivered by hand or overnight courier service, mailed or sent by telecopy to
the respective addresses specified herein, or, as to any party, to such other
addresses as may be designated by it in written notice to all other parties.
All notices, requests, consents and demands hereunder shall be deemed to have
been given on the date of receipt if delivered by hand or overnight courier
service or sent by telecopy, or if mailed, effective on the earlier of actual
receipt or three days after being mailed by certified mail, return receipt
requested, postage prepaid, addressed as aforesaid.
9. NO WAIVER, REMEDIES. No failure on the part of Administrative
Lender or any Lender to exercise, and no delay in exercising, any right
hereunder or under any of the Loan Papers shall operate as a waiver thereof;
nor shall any single or partial exercise of any right hereunder or under any
of the Loan Papers preclude any other or further exercise thereof or the
exercise of any other right. Neither Administrative Lender nor any Lender
shall be required to (a) prosecute collection or seek to enforce or resort to
any remedies against Company, any Guarantor, any other Obligor or any other
Person, (b) join Company, any Guarantor, any other Obligor or any other
Person in any action in which Administrative Lender or any Lender prosecutes
collection or seeks to enforce or resort to any remedies against Company, any
-6-
Guarantor, any other Obligor or any other Person liable on any of the
Obligation, or (c) seek to enforce or resort to any remedies with respect to
any Liens granted to (or benefiting, directly or indirectly) Administrative
Lender or any Lender by Company, any Guarantor, any other Obligor or any
other Person. Neither Administrative Lender nor any Lender shall have any
obligation to protect, secure or insure any of the Liens or the properties or
interests in properties subject thereto. The remedies herein provided are
cumulative and not exclusive of any remedies provided by Applicable Law.
10. RIGHT OF SET-OFF. Upon the occurrence and during the continuance of
any Event of Default, each Lender and Administrative Lender is hereby
authorized at any time and from time to time, to the fullest extent permitted
by Law, to set off and apply any and all deposits (general or special, time
or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Lender or Administrative Lender to or for the credit
or the account of any Guarantor against any and all of the obligations of
such Guarantor now or hereafter existing under this Guaranty, irrespective of
whether or not such Lender or Administrative Lender shall have made any
demand under this Guaranty. Each Lender and Administrative Lender agrees
promptly to notify such Guarantor after any such set-off and application,
provided that the failure to give such notice shall not affect the validity
of such set-off and application or provide a defense to such Guarantor's
obligations under this Guaranty. The rights of each Lender and Administrative
Lender under this SECTION 10 are in addition to other rights and remedies
(including, without limitation, other rights of set-off) which such Lender
and Administrative Lender may have.
11. LIENS. To the extent not prohibited by Applicable Law, each
Guarantor agrees that Administrative Lender or any Lender, in its discretion,
without notice or demand and without affecting either the liability of such
Guarantor, Company, any other Guarantor or any other Obligor, or any security
interest or other Lien, may foreclose any deed of trust or mortgage or
similar Lien covering interests in real or personal property, and the
interests in real or personal property secured thereby, by nonjudicial sale.
Each Guarantor waives any defense to the recovery by Administrative Lender or
any Lender hereunder against Company, such Guarantor or any collateral of any
deficiency after a nonjudicial sale and each Guarantor expressly waives any
defense or benefits that may be derived from Chapter 34 of the Texas Business
and Commerce Code, Section 51.003 of the Texas Property Code, or any similar
statute in effect in any other jurisdiction. Without limiting the foregoing,
each Guarantor waives, to the extent not prohibited by Applicable Law, any
defense arising out of any such nonjudicial sale even though such sale
operates to impair or extinguish any right of reimbursement or subrogation or
any other right or remedy of such Guarantor against Company, any other
Guarantor or any other Person or any Collateral or any other collateral. Each
Guarantor agrees that such Guarantor is liable, subject to the limitations of
SECTION 1 hereof, for any part of the Obligation remaining unpaid after any
foreclosure.
12. CONTINUING GUARANTY; TRANSFER OF NOTES. This Guaranty is an
irrevocable continuing guaranty of payment and shall (a) remain in full force
and effect until final payment in full (after the Maturity Date) of the
Obligation and all other amounts payable under this
-7-
Guaranty, (b) be binding upon each Guarantor, its successors and assigns, and
(c) inure to the benefit of and be enforceable by Lender and Administrative
Lender and their successors, transferees and assigns. Without limiting the
generality of the foregoing clause (c), to the extent permitted by the Credit
Agreement, each Lender may assign or otherwise transfer its rights under the
Credit Agreement, the Notes or any of the Loan Papers or any interest therein
to any other Person, and such other Person shall thereupon become vested with
all the rights or any interest therein, as appropriate, in respect thereof
granted to such Lender herein or otherwise.
13. INFORMATION. Each Guarantor acknowledges and agrees that it shall
have the sole responsibility for obtaining from Company and each other Obligor
such information concerning Company's and each Obligor's financial condition
or business operations as such Guarantor may require, and that neither
Administrative Lender nor any Lender has any duty at any time to disclose to
Guarantor any information relating to the business operations or financial
conditions of Company or any Obligor.
14. GOVERNING LAW. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS. WITHOUT EXCLUDING ANY OTHER
JURISDICTION, EACH GUARANTOR AGREES THAT THE STATE AND FEDERAL COURTS OF
TEXAS LOCATED IN DALLAS, TEXAS, SHALL HAVE JURISDICTION OVER PROCEEDINGS IN
CONNECTION HEREWITH. THIS GUARANTY IS PERFORMABLE IN DALLAS COUNTY, TEXAS.
15. WAIVER OF JURY TRIAL. EACH GUARANTOR, ADMINISTRATIVE LENDER, AND
LENDERS HEREBY KNOWINGLY, VOLUNTARILY, IRREVOCABLY AND INTENTIONALLY WAIVE,
TO THE MAXIMUM EXTENT PERMITTED BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR CLAIM ARISING OUT OF OR RELATED TO THIS GUARANTY OR ANY
OF THE LOAN PAPERS OR THE TRANSACTIONS CONTEMPLATED THEREBY. THIS PROVISION
IS A MATERIAL INDUCEMENT TO LENDER ENTERING INTO THE CREDIT AGREEMENT.
16. RATABLE BENEFIT. This Guaranty is for the ratable benefit of
Lenders and Administrative Lender, each of which shall share any proceeds of
this Guaranty pursuant to the terms of the Credit Agreement.
17. GUARANTOR INSOLVENCY. Should any Guarantor become insolvent, fail
to pay its debts generally as they become due, voluntarily seek, consent to,
or acquiesce in the benefits of any Debtor Relief Law or become a party to or
be made the subject of any proceeding provided for by any Debtor Relief Law
(other than as a creditor or claimant) that could suspend or otherwise
adversely affect the rights of any Lender or Administrative Lender granted
hereunder, then, the obligations of such Guarantor under this Guaranty shall
be, as between such Guarantor and such Lender and Administrative Lender, a
fully-matured, due, and payable obligation of such Guarantor to such Lender
and Administrative Lender (without regard to whether Company or any other
Obligor is then in default under the Credit Agreement or any
-8-
other Loan Paper or whether any part of the Obligation is then due and owing
by Company or any other Obligor to such Lender or Administrative Lender),
payable in full by such Guarantor to such Lender or Administrative Lender
upon demand, which shall be the estimated amount owing in respect of the
contingent claim created hereunder.
18. ENTIRE AGREEMENT. THIS GUARANTY, TOGETHER WITH THE OTHER LOAN
PAPERS, REPRESENTS THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
AMONG THE PARTIES.
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REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
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-9-
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered by its officer thereunto duly authorized as of the
date first above written.
LA QUINTA REALTY CORP.
By:
----------------------------------
Name:
--------------------------
Title:
-------------------------
LA QUINTA PLAZA, INC.
By:
----------------------------------
Name:
--------------------------
Title:
-------------------------
Address for all Guarantors:
000 Xxxx Xxxxx Xxxxxx XX QUINTA FINANCIAL CORPORATION
Xxx Xxxxxxx, Xxxxx 00000
By:
----------------------------------
Name:
--------------------------
Title:
-------------------------
LA QUINTA INVESTMENTS, INC.
By:
----------------------------------
Name:
--------------------------
Title:
-------------------------
-10-
LA QUINTA ACQUISITION CORPORATION
By:
----------------------------------
Name:
--------------------------
Title:
-------------------------
LA QUINTA MOTOR INNS LIMITED
PARTNERSHIP
By: La Quinta Realty Corp.,
its General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
LA QUINTA ROUGE JOINT VENTURE
By: La Quinta Inns, Inc., its
Managing General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
-00-
XX XXXXXX XXXXXX - XXXXXX ST., LTD
By: La Quinta Inns, Inc., its
General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
LQM OPERATING PARTNERS, L.P.
By: La Quinta Realty Corp., its
General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
LQ-BIG APPLE JOINT VENTURE
By: La Quinta Inns, Inc., its Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
By: La Quinta Investments, Inc., its
Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
-00-
XX-XXX LIMITED PARTNERSHIP
By: La Quinta Inns, Inc., its Managing
General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
LQ-EAST IRVINE JOINT VENTURE
By: La Quinta Inns, Inc., its Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
By: La Quinta Investments, Inc., its
Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
-13-
LQ-INVESTMENTS I
By: La Quinta Inns, Inc., its Managing
General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
By: La Quinta Investments, Inc., a
General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
LQ-INVESTMENTS II
By: La Quinta Inns, Inc., its Managing
General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
By: La Quinta Investments, Inc., a
General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
-00-
XX XXXXXX XXXX XX XXXXXXX, INC.
By:
----------------------------------
Name:
--------------------------
Title:
-------------------------
LA QUINTA INNS OF PUERTO RICO,
INC.
By:
----------------------------------
Name:
--------------------------
Title:
-------------------------
LA QUINTA DEVELOPMENT PARTNERS,
L.P.
By: La Quinta Inns, Inc., its
Sole General Partner
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
-15-
EXHIBIT E
ASSIGNMENT AND ACCEPTANCE
DATED _____________, 199__
Reference is made to the Amended and Restated Credit Agreement (Facility
A), dated as of September 12, 1995 (the "Credit Agreement") among La Quinta
Inns, Inc., a Texas corporation ("Borrower"), NationsBank of Texas, N.A. as
Administrative Lender ("Administrative Lender"), and the lenders parties
thereto. Terms defined in the Credit Agreement are used herein with the same
meaning.
______________________ ("Assignor") and _____________________
("Assignee") agree as follows:
1. Assignor hereby sells and assigns to Assignee, and Assignee hereby
purchases and assumes from Assignor, a __% interest in and to all of
Assignor's rights and obligations under the Credit Agreement as of the
Effective Date (as defined below), with respect to such percentage interest
in Assignor's Commitment as in effect on the Effective Date, the principal
amount of Revolving Credit Advances owing to Assignor on the Effective Date,
and the Revolving Credit Note held by Assignor, and Assignor's participation
in any Letters of Credit and Reimbursement Obligations outstanding on the
Effective Date, subject to the terms and conditions of this Assignment and
Acceptance.
2. Assignor (a) represents and warrants that (i) as of the date hereof
its Commitment (without giving effect to assignments thereof which have not
yet become effective) is $______ and, as of the date hereof, the outstanding
principal amount of the Revolving Credit Advances owing to it (without giving
effect to assignments thereof which have not yet become effective) is $____,
(ii) it is the legal and beneficial owner of the interest being assigned by
it hereunder and that such interest is free and clear of any adverse claim;
(b) makes no representation or warranty and assumes no responsibility with
respect to (i) any statements, warranties, or representations made in or in
connection with the Credit Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency, or value of the Credit Agreement or
any other instrument or document furnished pursuant thereto or (ii) the
financial condition of the Borrower or the performance or observance by the
Borrower of any of its obligations under the Credit Agreement or any other
instrument or document furnished pursuant thereto; and (c) attaches the
Revolving Credit Note referred to in Paragraph 1 above to exchange such
Revolving Credit Note for new Revolving Credit Notes as follows: a Revolving
Credit Note dated ____________, 199__, in the principal amount of $____
payable to the order of Assignee, and a Revolving Credit Note dated
____________, 199__, in the principal amount of $____ payable to the order of
Assignor.
3. Assignee (a) confirms that it has received a copy of the Credit
Agreement and the other Loan Papers, together with copies of the financial
statements referred to in Sections 6.1(a) and 6.1(b) of the Credit Agreement
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Acceptance; (b) agrees that it will, independently and without reliance upon
the Administrative Lender, Assignor, or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue
to make its own credit decisions in taking or not taking action under the
Credit Agreement and the other Loan Papers; (c) appoints and authorizes the
Administrative Lender to take such action as agent on its behalf and to
exercise such powers under the Credit Agreement, the other Loan Papers; and
this Assignment and Acceptance as are delegated to the Administrative Lender
by the terms thereof and hereof, together with such powers as are reasonably
incidental thereto and hereto; (d) agrees that it will perform in accordance
with its terms all of the obligations which by the terms of the Credit
Agreement, the other Loan Papers, and this Assignment and Acceptance are
required to be performed by it as a Lender, [and] (e) specifies the addresses
set forth in Schedule I attached hereto as its address for the receipt of
notices and as its initial LIBOR Lender Office, respectively[; and (f)
attaches the forms prescribed by the IRS certifying as to Assignee's status
for purposes of determining exception from United States withholding taxes
with respect to all payments to be made to Assignee under the Credit
Agreement, the other Loan Papers, and this Assignment and Acceptance or such
other documents as are necessary to indicate that all such payments are
subject to such taxes at a rate reduced by an applicable tax treaty].
4. The effective date for this Assignment and Acceptance shall be
____________, 199__ (the "Effective Date").
5. Upon such acceptance as of the Effective Date and upon the
remittance of a $3,500 processing fee to the Administrative Lender, (a)
Assignee shall be a party to the Credit Agreement and, to the extent provided
in this Assignment and Acceptance, have the rights and obligations of a
Lender thereunder and (b) Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Credit Agreement.
6. Upon such acceptance from and after the Effective Date, whenever the
Administrative Lender shall receive a payment, or whenever the Administrative
Lender shall make an application of funds, in respect of any aggregate
outstanding principal amount of the Revolving Credit Advances or in respect
of any aggregate amount of interest accrued on the Revolving Credit Advances,
or in respect of the commitment fee (other than a payment or an application
of funds in respect of any amount due and owing to any Lender or the
Administrative Lender under Sections 2.9, 5.22, 8.3, 8.5, or 10.2 of the
Credit Agreement), the Administrative Lender shall pay over to each of the
Lenders an amount equal to (i) such Lender's Pro Rata Share (as defined
below) of such aggregate amount of principal, (ii) such Lender's Pro Rata
Share of such aggregate amount of interest, and (iii) such Lender's Pro Rata
Share of such aggregate amount of the commitment fee.
The "Pro Rata Share" of any aggregate amount means, with respect to such
Lender, the amount equal to the product obtained by multiplying (i) such
aggregate amount and (ii) a fraction, the numerator of which is such Lender
Commitment, or after the Revolving Credit Advances have been made, the
principal amount of the Revolving Credit Advances owing
-2-
to such Lender and the denominator of which is the sum of the Commitments of
all of the Lenders, or after the Revolving Credit Advances have been made,
the aggregate principal amount of the Revolving Credit Advances owing to all
of the Lenders.
7. In the event that, after the Administrative Lender has paid to any
Lender its Pro Rata Share of any such payment received by the Administrative
Lender or any such application made by the Administrative Lender; such
payment or application is rescinded or must otherwise be returned or must be
paid over by the Administrative Lender for any reason, such Lender shall,
upon notice by the Administrative Lender, forthwith pay back to the
Administrative Lender such Lender's Pro Rata Share of the amount so rescinded
or so returned or paid over.
8. This Assignment and Acceptance shall be governed by and construed
in accordance with the laws of the State of Texas and the United States of
America. Without excluding any other jurisdiction, Assignee agrees that the
courts of Texas will have jurisdiction over proceedings in connection
herewith.
9. Assignee's Specified Percentage shall be __%.
10. This Assignment and Acceptance may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same
instrument.
[NAME OF ASSIGNOR]
By:
-----------------------------------
-----------------, ----------------
(Print Name) (Print Title)
[NAME OF ASSIGNEE]
By:
-----------------------------------
-----------------, ----------------
(Print Name) (Print Title)
-3-
Accepted this __ day of ____________, 199__
NATIONSBANK OF TEXAS, N.A.,
as Administrative Lender
By:
----------------------------------
-----------------, ---------------
(Print Name) (Print Title)
LA QUINTA INNS, INC.
By:
----------------------------------
-----------------, ---------------
(Print Name) (Print Title)
-4-
SCHEDULE I
ASSIGNEE'S ADDRESS
1. ADDRESS FOR THE ADVANCES AND RECEIPT OF NOTICES
2. INITIAL LIBOR LENDING OFFICE
-5-
EXHIBIT F
[Form of Confidentiality Agreement]
CONFIDENTIALITY AGREEMENT
[Date]
[Insert Name and Address
of Prospective Participant
or Assignee]
Re: Amended and Restated Credit Agreement (Facility A), dated as of
September 12, 1995, among La Quinta Inns, Inc. (the "Borrower"),
the Lenders a party thereto, and NationsBank of Texas, N.A., as
Administrative Lender.
Dear ___________:
As a Lender party to the above-referenced Credit Agreement (the "CREDIT
AGREEMENT"); capitalized terms used herein shall have the same meaning given
to them in the Credit Agreement), we have agreed with the Borrower pursuant
to Section 10.10 of the Credit Agreement to use reasonable precautions to
keep confidential, except as otherwise provided therein, all non-public
information identified by the Borrower as being confidential at the time the
same is delivered to us pursuant to the Credit Agreement.
As provided in said Section 10.10, we are permitted to provide you, as a
prospective [PARTICIPANT] [ASSIGNEE], with certain of such non-public
information subject to the execution and delivery by you, prior to receiving
such non-public information, of a Confidentiality Agreement in this form.
Such information will not be made available to you until your execution and
return to us of this Confidentiality Agreement.
Accordingly, in consideration of the foregoing, you agree (on behalf of
yourself and each of your affiliates, directors, officers, employees and
representatives) that (A) such information will not be used by you except in
connection with the proposed [PARTICIPATION] [ASSIGNMENT] mentioned above and
(B) you shall use reasonable precautions, in accordance with your customary
procedures for handling confidential information and in accordance with safe
and sound banking practices, to keep such information confidential, provided
that nothing herein shall limit the disclosure of any such information (i) to
the extent required by statute, rule, regulation or judicial process, (ii) to
your counsel or to counsel for any of the Lenders or the Administrative
Lender, (iii) to bank examiners, auditors or accountants of any of the
Lenders, (iv) to the Administrative Lender, or any other Lender, (v) in
connection with any litigation to which you or any one or more of the Lenders
are a party; provided, further, that, unless specifically prohibited by
Applicable Law or court order, you agree, prior to disclosure thereof, to
notify the Borrower of any request for disclosure of any such non-public
information (x) by
____________, 199_
Page 2
any governmental agency or representative thereof (other than any such request
in connection with an examination of your financial condition by such
governmental agency) or (y) pursuant to legal process; and provided, finally,
that in no event shall you be obligated to return any materials furnished to
you pursuant to this Confidentiality Agreement.
Would you please indicate your agreement to the foregoing by signing at
the place provided below the enclosed copy of this Confidentiality Agreement.
Very truly yours,
----------------------------------
By:
-------------------------------
Title:
----------------------------
THE FOREGOING IS AGREED TO AS OF THE
DATE OF THIS LETTER.
----------------------------------
By:
-------------------------------
Title:
----------------------------
