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EXHIBIT 10.21
EXECUTION
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2000 TERM LOAN AGREEMENT
Dated as of October 3, 2000
among
XXXXXXX AND BROAD HOME CORPORATION
as Borrower
THE BANKS PARTY HERETO
BANK OF AMERICA, N.A.,
as Administrative Agent
CREDIT LYONNAIS LOS ANGELES BRANCH,
as Syndication Agent
BANK ONE, NA,
as Documentation Agent
and
BANC OF AMERICA SECURITIES LLC,
as Lead Arranger and Sole Book Manager
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TABLE OF CONTENTS
Page
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RECITALS ................................................................................... 1
Article 1 DEFINITIONS AND ACCOUNTING TERMS ................................................. 1
1.1 Defined Terms .................................................................. 1
1.2 Use of Defined Terms ........................................................... 24
1.3 Accounting Terms ............................................................... 24
1.4 Rounding ....................................................................... 24
1.5 Miscellaneous Terms ............................................................ 24
1.6 Exhibits and Schedules ......................................................... 24
1.7 References to "Borrower and its Subsidiaries" .................................. 24
Article 2 LOANS ............................................................................ 25
2.1 Loans-General .................................................................. 25
2.2 Prime Rate Loans ............................................................... 26
2.3 LIBOR Loans .................................................................... 26
2.4 Initial Request for Loan ....................................................... 26
2.5 Administrative Agent's Right to Assume Funds Available ......................... 26
2.6 Optional Increase to Commitment ................................................ 27
Article 3 PAYMENTS AND FEES ................................................................ 29
3.1 Principal and Interest ......................................................... 29
3.2 Upfront Fee .................................................................... 30
3.3 Agency Fee ..................................................................... 30
3.4 Capital Adequacy ............................................................... 30
3.5 LIBOR Fees and Costs ........................................................... 32
3.6 Late Payments/Default Interest ................................................. 34
3.7 Computation of Interest and Fees ............................................... 34
3.8 Holidays ....................................................................... 34
3.9 Payment Free of Taxes .......................................................... 35
3.10 Funding Sources ............................................................... 35
3.11 Failure to Charge or Making of Payment Not Subsequent Waiver .................. 35
3.12 Time and Place of Payments; Evidence of Payments; Application of Payments ..... 36
3.13 Administrative Agent's Right to Assume Payments Will be Made .................. 36
3.14 Survivability ................................................................. 36
3.15 Bank Calculation Certificate .................................................. 36
3.16 Transition .................................................................... 36
Article 4 REPRESENTATIONS AND WARRANTIES ................................................... 38
4.1 Existence and Qualification; Power; Compliance with Law ........................ 38
4.2 Authority; Compliance with Other Instruments and Government Regulations ........ 38
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4.3 No Governmental Approvals Required ............................. 39
4.4 Subsidiaries ................................................... 39
4.5 Financial Statements ........................................... 40
4.6 No Other Liabilities; No Material Adverse Effect ............... 40
4.7 Title to Assets ................................................ 40
4.8 Intangible Assets .............................................. 40
4.9 Existing Indebtedness and Contingent Guaranty Obligations ...... 40
4.10 Governmental Regulation ....................................... 41
4.11 Litigation .................................................... 41
4.12 Binding Obligations ........................................... 41
4.13 No Default .................................................... 41
4.14 Pension Plans ................................................. 41
4.15 Tax Liability ................................................. 41
4.16 Regulation U .................................................. 41
4.17 Environmental Matters ......................................... 41
4.18 Disclosure .................................................... 42
4.19 Projections ................................................... 42
Article 5 AFFIRMATIVE COVENANTS
(OTHER THAN INFORMATION AND REPORTING REQUIREMENTS) .............. 43
5.1 Payment of Taxes and Other Potential Liens ..................... 43
5.2 Preservation of Existence ...................................... 43
5.3 Maintenance of Properties ...................................... 43
5.4 Maintenance of Insurance ....................................... 43
5.5 Compliance with Laws ........................................... 43
5.6 Inspection Rights .............................................. 44
5.7 Keeping of Records and Books of Account ........................ 44
5.8 Use of Proceeds ................................................ 44
5.9 Subsidiary Guaranty ............................................ 44
Article 6 NEGATIVE COVENANTS ............................................... 45
6.1 Payment or Prepayment of Subordinated Obligations .............. 45
6.2 [Intentionally Omitted] ........................................ 45
6.3 Mergers and Sale of Assets ..................................... 45
6.4 Investments and Acquisitions ................................... 45
6.5 ERISA Compliance ............................................... 46
6.6 Change in Business ............................................. 47
6.7 Liens and Negative Pledges ..................................... 47
6.8 Transactions with Affiliates ................................... 48
6.9 Consolidated Tangible Net Worth ................................ 48
6.10 Consolidated Leverage Ratio ................................... 49
6.11 Consolidated Interest Coverage Ratio .......................... 50
6.12 Distributions ................................................. 50
6.13 Amendments .................................................... 50
6.14 Hostile Tender Offers ......................................... 50
6.15 Inventory ..................................................... 50
6.16 Investment in Subsidiaries and Joint Ventures ................. 50
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6.17 Money Market Indebtedness .............................................. 50
6.18 Domestic Standing Inventory ............................................ 51
Article 7 INFORMATION AND REPORTING REQUIREMENTS .................................... 52
7.1 Financial and Business Information of Borrower and Its Subsidiaries ..... 52
7.2 Compliance Certificate .................................................. 54
Article 8 CONDITIONS ................................................................ 55
8.1 Initial Advances ........................................................ 55
Article 9 EVENTS OF DEFAULT AND REMEDIES UPON EVENTS OF DEFAULT ..................... 57
9.1 Events of Default ....................................................... 57
9.2 Remedies Upon Event of Default .......................................... 58
Article 10 THE ADMINISTRATIVE AGENT ................................................. 60
10.1 Appointment and Authorization .......................................... 60
10.2 Administrative Agent and Affiliates .................................... 60
10.3 Banks' Credit Decisions ................................................ 60
10.4 Action by Administrative Agent ......................................... 60
10.5 Liability of Administrative Agent ...................................... 61
10.6 Indemnification ........................................................ 62
10.7 Successor Administrative Agent ......................................... 62
10.8 No Obligations of Borrower ............................................. 63
10.9 Defaulting Banks ....................................................... 63
Article 11 MISCELLANEOUS ............................................................ 64
11.1 Cumulative Remedies; No Waiver ......................................... 64
11.2 Amendments; Consents ................................................... 64
11.3 Costs, Expenses and Taxes .............................................. 64
11.4 Nature of Banks' Obligations ........................................... 65
11.5 Representations and Warranties ......................................... 66
11.6 Notices ................................................................ 66
11.7 Execution in Counterparts .............................................. 66
11.8 Binding Effect; Assignment ............................................. 66
11.9 Sharing of Setoffs ..................................................... 68
11.10 Indemnity by Borrower ................................................. 69
11.11 Nonliability of Banks ................................................. 70
11.12 Confidentiality ....................................................... 70
11.13 No Third Parties Benefited ............................................ 70
11.14 Other Dealings ........................................................ 71
11.15 Right of Setoff - Deposit Accounts .................................... 71
11.16 Further Assurances .................................................... 71
11.17 Integration ........................................................... 71
11.18 Governing Law ......................................................... 71
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11.19 Severability of Provisions ............................................ 71
11.20 Headings .............................................................. 71
11.21 Conflict in Loan Documents ............................................ 71
11.22 Waiver Of Jury Trial .................................................. 71
11.23 Purported Oral Amendments ............................................. 72
11.24 Hazardous Materials Indemnity ......................................... 73
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Exhibits
A - Commitment Assignment and Acceptance
B - Compliance Certificate
C - Note
D-1 - Opinion of Counsel
D-2 - Opinion of Counsel
E - Subsidiary Guaranty
F - Quarterly Report - Sales
G - Quarterly Report - Inventory
Schedules
1.1 Pro Rata Shares
4.4 Subsidiaries
4.7 Existing Liens and Rights of Others
4.9 Existing Indebtedness and Contingent Obligations
6.4 Investments
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2000 TERM LOAN AGREEMENT
Dated as of October 3, 2000
This 2000 Term Loan Agreement ("Agreement") is entered into by and
among Xxxxxxx and Broad Home Corporation, a Delaware corporation ("Borrower"),
each bank set forth on the signature pages of this Agreement or which from time
to time becomes party hereto (collectively, the "Banks" and individually, a
"Bank") and Bank of America, N.A., as Administrative Agent, Credit Lyonnais Los
Angeles Branch, as Syndication Agent, Bank One, NA, as Documentation Agent, and
Banc of America Securities LLC as Lead Arranger and Sole Book Manager.
RECITALS
This Agreement establishes a new credit facility replacing that
certain Term Loan Agreement dated as of January 7, 1999 by and among Borrower,
the banks named therein, Bank of America National Trust and Savings Association,
as Administrative Agent and various other banks in various agent capacities, as
amended (the "Prior Term Loan Agreement"). Subject to the transition provisions
of Section 3.16, and as contemplated by Section 8.1(a)(viii), the terms and
provisions of this Agreement shall become effective, and the Prior Term Loan
Agreement shall terminate, as of the 2000 Closing Date.
WHEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto covenant and agree as follows:
Article 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Defined Terms. As used in this Agreement, the following terms
shall have the meanings set forth below:
"2000 Closing Date" means the time and Banking Day on which the
conditions set forth in Section 8.1 are satisfied or waived pursuant to
Section 11.2, as evidenced by the return of one or more of the
promissory notes under the Prior Loan Agreements by the Administrative
Agent to Borrower.
"2000 Revolving Loan Agreement" means the 2000 Revolving Loan
Agreement dated as of October 3, 2000 among Borrower, Bank of America,
as administrative agent, and the banks party thereto, and as the same
may from time to time be amended, modified, refinanced or replaced.
"Acquisition" means any transaction, or any series of related
transactions, consummated after the 2000 Closing Date, by which Borrower
and/or any of its Subsidiaries directly or indirectly (a) acquires any
ongoing business or all or substantially all of the assets of any firm,
corporation or division thereof, whether through purchase of assets,
merger or otherwise, (b) acquires control of securities of a corporation
representing 50% or more of the ordinary voting power for the election
of directors or (c) acquires control of a 50% or more ownership interest
in any partnership, joint venture or other business entity.
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"Administrative Agent" means Bank of America or any successor
administrative agent.
"Administrative Agent's Office" means Bank of America, N.A., 0
Xxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000, or such other office as
the Administrative Agent may designate in writing to Borrower and the
Banks.
"Advance" means an advance made or to be made to Borrower by a
Bank pursuant to Article 2.
"Affiliate" means, with respect to any Person, any other Person
which directly or indirectly controls, or is under common control with,
or is controlled by, such Person. As used in this definition, "control"
(including its correlative meanings, "controlled by" and "under common
control with") shall mean possession, directly or indirectly, of power
to direct or cause the direction of management or policies (whether
through ownership of securities or partnership or other ownership
interests, by contract or otherwise); provided that, in any event, any
Person which owns directly or indirectly 10% or more of the securities
having ordinary voting power for the election of directors or other
governing body of a corporation that has more than 100 record holders of
such securities or 10% or more of the partnership or other ownership
interests of any other Person that has more than 100 record holders of
such interests will be deemed to control such corporation or other
Person.
"Agents" mean the Administrative Agent, the Syndication Agent,
the Documentation Agent, and the Lead Arranger and Sole Book Manager.
"Agreement" means this 2000 Term Loan Agreement, either as
originally executed or as it may from time to time be supplemented,
modified, amended, renewed, extended or supplanted.
"Applicable LIBOR Spread" means, as of any date of determination,
the interest rate spread set forth below opposite the Applicable Pricing
Level as of such date:
Applicable Applicable
Pricing Level LIBOR Spread
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I 1.400%
II 1.625%
III 1.750%
IV 1.950%
V 2.200%
"Applicable Minimum Hold Requirement" means, in the case of any
Bank, the amount of the Pro Rata Share of the Commitment held by that
Bank plus the amount, if any, of the Pro Rata Share (as defined in the
2000 Revolving Loan Agreement) of the Commitment (as defined in the 2000
Revolving Loan Agreement) held by that Bank, as reduced by (a) the
amount of any assignment of a portion thereof made by that Bank to an
Eligible Assignee that is not an Affiliate of that Bank and (b) the
amount of any participation therein granted by that Bank to a
participant that is not an Affiliate of that Bank, which net amount,
after giving effect to clauses (a) and (b), shall not be less than
$20,000,000 (unless approved in writing by the
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Administrative Agent or unless an Event of Default has occurred and is
continuing), but subject to the provisions of Section 11.8(b) and (e).
"Applicable Pricing Level" means, Pricing Level "I" for any day
on which Borrower holds an Investment Grade Credit Rating and, for any
day during a Pricing Period on which Borrower does not hold an
Investment Grade Credit Rating, means the following:
Consolidated Leverage Ratio
Applicable Pricing Level Applicable to Pricing Period
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II Consolidated Leverage Ratio of less than or
equal to 1.25 to 1.00
III Consolidated Leverage Ratio of greater than
1.25 to 1.00, but less than or equal to 1.80
to 1.00
IV Consolidated Leverage Ratio of greater than
1.80 to 1.00, but less than or equal to 2.25
to 1.00
V Consolidated Leverage Ratio of greater than
2.25 to 1.00.
Borrower is responsible pursuant to Section 7.1(k) to provide the
Administrative Agent with notice of each change in the Applicable
Pricing Level that is due to the inception or cessation of an Investment
Grade Credit Rating.
"Applicable Prime Rate Spread" means, as of any date of
determination, the interest rate spread set forth below opposite the
Applicable Pricing Level as of such date:
Applicable
Applicable Prime Rate
Pricing Level Spread
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I 0.00%
II 0.00%
III 0.00%
IV 0.00%
V 0.25%
"Associate" shall have the meaning ascribed to such term in Rule
12b-2 of the General Rules and Regulations under the Exchange Act, as in
effect on the date hereof.
"Authorizations" has the meaning set forth for that term in
Section 4.1.
"Bank" means each bank whose name is set forth in the signature
pages of this Agreement and each lender which may hereafter become a
party to this Agreement pursuant to Section 11.8.
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"Bank of America" means Bank of America, N.A., formerly known as
Bank of America National Trust and Savings Association.
"Banking Day" means any Monday, Tuesday, Wednesday, Thursday or
Friday other than a day on which banks are authorized or required to be
closed in California or New York.
"Bond Facility" means any bond facility pursuant to which a
municipality, or a community facilities district formed by a
municipality, has or will issue bonds to finance a portion of the costs
of acquisition of and/or improvements to real property located in such
municipality (or district) owned by Borrower, one of its Subsidiaries or
by another Person acquired by Borrower or one of its Subsidiaries (or to
pay development or "impact" fees in lieu thereof), and with respect to
which Borrower or one of its Subsidiaries will provide a letter of
credit or other reimbursement support. The real property that is the
subject of any such bond facility will be subject to a Lien for special
taxes to repay the Indebtedness evidenced by such bonds.
"Borrower" means Xxxxxxx and Broad Home Corporation, a Delaware
corporation, and its successors and permitted assigns.
"Bridge Loan Agreement" means the 2000 Bridge Loan Agreement
dated as of May 10, 2000 by and among Borrower, the banks named therein,
Bank of America, as administrative agent, and various other banks in
various agent capacities.
"Capital Lease" means, with respect to any Person, a lease of
any Property by that Person as lessee that is, or should be in
accordance with Financial Accounting Standards Board Statement No. 13,
recorded as a "capital lease" on a balance sheet of that Person prepared
in accordance with Generally Accepted Accounting Principles.
"Cash" means all monetary items (including currency, coin and
bank demand deposits) that are treated as cash under Generally Accepted
Accounting Principles.
"Cash Equivalents" means, with respect to any Person, that
Person's Investments in:
(a) Government Securities due within one year of the making
of the Investment;
(b) readily marketable direct obligations of any State of the
United States of America or any political subdivision of any such
State or any public agency or instrumentality thereof given on
the date of such Investment a credit rating of at least Aa3 by
Xxxxx'x or AA- by S&P, in each case due within one year from the
making of the Investment;
(c) certificates of deposit issued by, deposits in,
eurodollar deposits through, bankers' acceptances of, and
repurchase agreements covering Government Securities executed by,
(i) any Bank or (ii) any bank and/or savings and loan association
doing business in and incorporated under the Laws of the United
States of America, any state thereof or the District of Columbia
and having on the date of such Investment combined capital,
surplus and undivided profits of at least $500,000,000 and which
carries on the date of such Investment a credit rating of P-1 or
higher by
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Xxxxx'x or A-1 or higher by S&P, in each case due within one year
after the date of the making of the Investment;
(d) certificates of deposit issued by, bank deposits in,
eurodollar deposits through, bankers' acceptances of, and
repurchase agreements covering Government Securities executed by
any branch or office located in the United States of America of a
bank incorporated under the Laws of any jurisdiction outside the
United States of America having on the date of such Investment
combined capital, surplus and undivided profits of at least
$500,000,000 and which carries on the date of such Investment a
credit rating of P-1 or higher by Xxxxx'x or A-1 or higher by
S&P, in each case due within one year after the date of the
making of the Investment;
(e) readily marketable commercial paper or other debt
securities of (i) any Bank that is a Bank as of the 2000 Closing
Date, (ii) corporations, commercial banks or financial
institutions doing business in and incorporated under the Laws of
the United States of America or any state thereof or the District
of Columbia or (iii) a holding company for a bank described in
clause (c) or (d) above, given on the date of such Investment a
credit rating of P-1 or higher by Xxxxx'x, of A-1 or higher by
S&P, or F-1 or higher by Fitch, in each case due within one year
of the making of the Investment;
(f) repurchase agreements covering Government Securities
executed by a broker or dealer registered under Section 15(b) of
the Exchange Act, having on the date of the Investment capital of
at least $50,000,000, due within 90 days after the date of the
making of the Investment; provided, that the maker of the
Investment receives written confirmation of the transfer to it of
record ownership of the Government Securities on the books of a
"primary dealer" in such government Securities or on the books of
such registered broker or dealer, as soon as practicable after
the making of the Investment;
(g) "money market preferred stock" issued by a corporation
incorporated under the Laws of the United States of America or
any State thereof (i) given on the date of such Investment a
credit rating of at least Aa3 by Xxxxx'x and AA- by S&P, in each
case having an investment period not exceeding 50 days or (ii) to
the extent that investors therein have the benefit of a standby
letter of credit issued by a Bank or a bank described in clauses
(c) or (d) above; provided, that (y) the amount of all such
Investments issued by the same issuer does not exceed $10,000,000
and (z) the aggregate amount of all such Investments does not
exceed $25,000,000;
(h) a readily redeemable "money market mutual fund" sponsored
by a bank described in clause (c) or (d) hereof, or a registered
broker or dealer described in clause (f) hereof, that has and
maintains an investment policy limiting its investments primarily
to instruments of the types described in clauses (a) through (g)
hereof and given on the date of such Investment a credit rating
of at least Aa3 by Xxxxx'x and AA- by S&P; and
(i) corporate notes or bonds having an original term to
maturity of not more than one year issued by a corporation
incorporated under the Laws of the United States of America or
any state thereof, or a participation interest therein; provided,
that
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(i) commercial paper issued by such corporation is given on the
date of such Investment a credit rating of at least Aa3 by
Xxxxx'x and AA- by S&P, (ii) the amount of all such Investments
issued by the same issuer does not exceed $10,000,000 and (iii)
the aggregate amount of all such Investments does not exceed
$25,000,000.
"Change in Control" means, and shall be deemed to have occurred
at such time as any of the following events shall occur:
(a) there shall be consummated any consolidation or merger of
Borrower in which Borrower is not the continuing or surviving
corporation or pursuant to which the Voting Stock would be
converted into Cash, securities or other property, other than a
merger or consolidation of Borrower where the Borrower is not the
continuing or surviving corporation and in which the holders of
Voting Stock immediately prior to the merger have 75% ownership,
directly or indirectly, of the Voting Stock of the surviving
corporation immediately after such merger or consolidation; or
(b) there is a report filed by any person, including its
Affiliates and Associates, on Schedule 13D or 14D-1 (or any
successor schedule, form or report) pursuant to the Exchange Act,
disclosing that such person (for the purposes of the definition
of Change in Control only, the term "person" is used as defined
in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or
any successor provision to either of the foregoing) has become
the beneficial owner (as the term "beneficial owner" is defined
under Rule 13d-3 or any successor rule or regulation promulgated
under the Exchange Act) of 50% or more of the voting power of
Borrower's Voting Stock then outstanding; provided, however, that
a person shall not be deemed beneficial owner of, or to own
beneficially (1) any Securities tendered pursuant to a tender or
exchange offer made by or on behalf of such person or any of such
person's Affiliates or Associates until such tendered Securities
are accepted for purchase or exchange thereunder, or (2) any
Securities if such beneficial ownership (a) arises solely as a
result of a revocable proxy delivered in response to a proxy or
consent solicitation made pursuant to, and in accordance with,
the applicable rules and regulations under the Exchange Act, and
(b) is not also then reportable on Schedule 13D (or any successor
schedule) under the Exchange Act; or
(c) a "Change in Control" (or analogous term) as defined in
one or more indentures or agreements governing any Subordinated
Obligations occur and $25,000,000 of Subordinated Obligations
thereupon become due and payable by Borrower or its Subsidiaries.
Notwithstanding the foregoing, a Change in Control shall not be deemed
to have occurred if at any time Borrower, any Subsidiary of Borrower,
any employee stock ownership plan or any other employee benefit plan,
including any Pension Plan of Borrower or any Subsidiary of Borrower, or
any person holding Voting Stock for or pursuant to the terms of such
employee benefit plan, files or becomes obligated to file a report under
or in response to Schedule 13D or Schedule 14D-1 (or any successor
schedule, form or report) under the Exchange Act disclosing beneficial
ownership by it of shares of Voting Stock, whether in excess of 50% or
otherwise.
"Code" means the Internal Revenue Code of 1986, as amended or
replaced and as in effect from time to time.
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"Commission" means the Securities and Exchange Commission and any
successor commission.
"Commitment" means, subject to Section 2.6, $160,950,000. The
Pro Rata Shares of the Banks with respect to the Commitment are set
forth in Schedule 1.1.
"Commitment Assignment and Acceptance" means a commitment
assignment and acceptance substantially in the form of Exhibit A.
"Common Stock" means the $1.00 par value common stock and special
common stock of Borrower.
"Compliance Certificate" means a compliance certificate in the
form of Exhibit B signed, on behalf of Borrower, by a Senior Officer of
Borrower.
"Consolidated Adjusted EBITDA" means, for any fiscal period,
Consolidated EBITDA for that fiscal period plus (a) the amount of
capitalized interest that was included in cost of sales in determining
Consolidated Net Income for that fiscal period plus (b) all non-Cash Net
Realizable Value Adjustments made during that fiscal period.
"Consolidated EBITDA" means, for any fiscal period, the sum of
(a) Consolidated Net Income for that period, plus (b) any extraordinary
loss reflected in such Consolidated Net Income, minus (c) any
extraordinary gain reflected in such Consolidated Net Income, plus (d)
Consolidated Interest Expense for that period plus (e) the aggregate
amount of federal and state taxes on or measured by income for that
period (whether or not payable during that period), plus (f)
depreciation, amortization and all other non-cash expenses for that
period, in each case as determined in accordance with Generally Accepted
Accounting Principles, in the case of items (d), (e) and (f), only to
the extent deducted in the determination of Consolidated Net Income for
that period.
"Consolidated Interest Coverage Ratio" means, with respect to any
Fiscal Quarter of Borrower and its Consolidated Subsidiaries, the ratio
of (a) Consolidated Adjusted EBITDA for the twelve month period ending
on the last day of such Fiscal Quarter to (b) the sum of (i)
Consolidated Interest Expense (including any non-cash items included in
Consolidated Interest Expense) plus (ii) to the extent not included in
Consolidated Interest Expense, any charge to Consolidated Net Income
which reflects the distribution paid or accrued to or for the holders of
the Trust Preferred Capital Securities (including any such charge
denominated "minority interest in net income of consolidated
subsidiaries") plus (iii) all dividends (other than dividends paid in
the same class of stock) paid on any preferred stock of Borrower, in
each case for the twelve month period ending on the last day of such
Fiscal Quarter.
"Consolidated Interest Expense" means, with respect to any
fiscal period of Borrower and its Consolidated Subsidiaries, the
aggregate amount of interest, fees, charges and related expenses paid or
payable to a lender in connection with borrowed money that is treated as
interest (including accretion of original issue discount on long-term
debt existing during such fiscal period) and the interest portion of any
capitalized lease payment of Borrower and its Consolidated Subsidiaries
(other than any such items properly attributable to Financial
Subsidiaries).
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"Consolidated Joint Venture" means, as of any date of
determination, a Joint Venture that is consolidated in the consolidated
financial statements of Borrower and its Subsidiaries as of such date.
"Consolidated Leverage Ratio" means, as of any date of
determination, the ratio of (a) Consolidated Total Indebtedness on that
date to (b) [Consolidated Tangible Net Worth on that date minus the
amount, if any, by which the portion of Shareholders' Equity of Borrower
and its Consolidated Subsidiaries attributable to Borrower's equity
interest in the Shareholders' Equity of all Joint Ventures (other than
any Consolidated Joint Venture) exceeds $30,000,000].
"Consolidated Net Income" means, with respect to any fiscal
period, the consolidated net income of Borrower and its Consolidated
Subsidiaries for that period, determined in accordance with Generally
Accepted Accounting Principles, consistently applied.
"Consolidated Subsidiaries" means, with respect to Borrower, all
of the Subsidiaries of Borrower whose financial statements are
consolidated with the consolidated financial statements of Borrower
under Generally Accepted Accounting Principles.
"Consolidated Tangible Net Worth" means, as of any date of
determination, the Shareholders' Equity of Borrower and its Consolidated
Subsidiaries on a consolidated basis on that date plus, if that date is
on or prior to the Settlement Date with respect to an issuance of
securities treated as Trust Preferred Capital Securities, an amount
equal to 100% of the aggregate book value of such Trust Preferred
Capital Securities outstanding on that date minus the aggregate book
value on that date of any Intangible Assets consisting of goodwill
arising from Acquisitions completed after November 30, 1996, provided
that any cumulative positive or negative adjustment to Consolidated
Tangible Net Worth attributable to foreign currency translations shall
be ignored.
"Consolidated Total Indebtedness" means, as of any date of
determination, all Indebtedness and Contingent Guaranty Obligations of
Borrower and its Subsidiaries on that date (without duplication for any
guaranty by Borrower of a Subsidiary's Indebtedness or any guaranty by a
Subsidiary of either Borrower's or another Subsidiary's Indebtedness)
plus (a) if that date is after the Settlement Date with respect to an
issuance of securities treated as Trust Preferred Capital Securities, an
amount equal to 100% of the aggregate book value of such Trust Preferred
Capital Securities outstanding on that date, minus (b) all Indebtedness
and Contingent Guaranty Obligations of the Financial Subsidiaries on
that date, and minus (c) the amount, if any, by which the aggregate Cash
and Cash Equivalents of Borrower and its Subsidiaries (other than the
Financial Subsidiaries) on that date are in excess of $15,000,000.
"Contingent Guaranty Obligation" means, as to any Person, any
(a) direct or indirect guarantee of Indebtedness of, or other obligation
performable by, any other Person (other than a performance obligation
undertaken in the ordinary and usual course of business), including any
endorsement (other than for collection or deposit in the ordinary course
of business), co-making or sale with recourse of the obligations of any
other Person or (b) assurance given to an obligee with respect to the
performance of an obligation (other than a performance obligation
undertaken in the ordinary and usual course of business) by, or the
financial condition of, any other Person, whether direct, indirect or
contingent, including any purchase or repurchase agreement covering such
obligation or any collateral security therefor, any agreement to provide
funds (by means of loans, capital contributions or otherwise) to such
other Person, any
-8-
15
agreement to support the solvency or level of any balance sheet item of
such other Person, or any "keep-well", "take-or-pay", "through put" or
other arrangement of whatever nature having the effect of assuring or
holding harmless any obligee against loss with respect to any obligation
of such other Person. The amount of any Contingent Guaranty Obligation
shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation (unless the Contingent Guaranty
Obligation is limited by its terms to a lesser amount, in which case to
the extent of such amount) or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as
determined by the Person in good faith.
"Contractual Obligation" means, as to any Person, any provision
of any outstanding Securities issued by that Person or of any material
agreement, instrument or undertaking to which that Person is a party or
by which it or any of its Property is bound, other than, in the case of
Borrower and its Subsidiaries, any of the Loan Documents.
"Debtor Relief Laws" means the Bankruptcy Code of the United
States of America, as amended from time to time, and all other
applicable liquidation, conservatorship, insolvency, reorganization, or
similar debtor relief Laws from time to time in effect affecting the
rights of creditors generally.
"Default" means any event that, with the giving of any notice or
passage of time, or both, would be an Event of Default.
"Default Rate" means the interest rate described in Section 3.6.
"Designated Deposit Account" means a demand deposit account to be
maintained by Borrower with Bank of America, as from time to time
designated by Borrower by written notification to the Administrative
Agent.
"Distribution" means, with respect to any shares of capital
stock or any warrant or right to acquire shares of capital stock or any
other equity security issued by a Person, (a) the retirement,
redemption, purchase, or other acquisition for value (other than for
capital stock of the same type of such Person) by such Person of any
such security, (b) the declaration or payment by such Person of any
dividend in Cash or in Property (other than in capital stock of the same
type of such Person) on or with respect to any such security, and (c)
any Investment by such Person in any holder of 5% or more of the capital
stock (or other equity securities) of such Person, if a purpose of such
Investment is to avoid the characterization of the transaction between
such Person and such holder as a Distribution under clause (a) or (b)
above. In addition, to the extent any loan or advance by Borrower to one
of its Subsidiaries is deemed to be an "Investment" for purposes of this
Agreement, then any principal payment made by such Subsidiary in respect
of such loan or advance shall be considered a Distribution for purposes
of Section 6.16.
"Documentation Agent" means Bank One, NA, so long as such bank
is a Bank hereunder. The Documentation Agent shall have no duties under
the Loan Documents beyond those of a Bank.
"Dollars" means the national currency of the United States of
America.
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16
"Domestic Lending Office" means, with respect to each Bank, its
office, branch or affiliate identified on the signature pages hereof as
its Domestic Lending Office or such other office, branch or affiliate as
such Bank may hereafter designate as its Domestic Lending Office by
notice to the Borrower and the Administrative Agent.
"Domestic Standing Inventory" means, as of any date of
determination, the number of items of unsold housing inventory (other
than Model Homes) of Borrower and its Domestic Subsidiaries with respect
to which either (a) 90% of the then reasonably anticipated direct
construction costs have been incurred on such date or (b) at least 12
months have elapsed from the date its construction was commenced through
and including such date. Construction for purposes of this definition
shall be deemed to have commenced upon the pouring of foundation
concrete.
"Domestic Subsidiary" means, with respect to any Person and as
of any date of determination, a Subsidiary of such Person (a) that is
organized under the Laws of the United States of America or any state
thereof and (b) the majority of the assets of which (as reflected on a
balance sheet of such Subsidiary prepared in accordance with Generally
Accepted Accounting Principles) is located in the United States of
America; provided that Xxxxxxx and Broad International, Inc., a
California corporation, shall in no event be considered a Domestic
Subsidiary of Borrower.
"Domestic Unimproved Land" means, as of any date of
determination, real Property located in the United States of America
that is: (a) owned by Borrower or any of its Subsidiaries if on that
date there has been expended by Borrower and its Subsidiaries less than
50% of the physical construction costs reasonably estimated by Borrower
(in accordance with its past practices as of the 2000 Closing Date) to
bring such real Property to "finished lot" status; or (b) owned by
Persons other than Borrower or any of its Subsidiaries but which, if
owned by Borrower or any of its Subsidiaries on that date, would have
satisfied the requirement set forth in clause (a) and if on that date
Borrower or any of its Domestic Subsidiaries holds an option to purchase
such real Property for which it has paid an amount equal to 33% or more
of the purchase price provided for in such option to purchase, provided,
that in the event an option to purchase land covers more than one
parcel, phase or lot, any deposit paid by Borrower or any of its
Subsidiaries shall be allocated to each parcel, phase or lot pro rata in
accordance with the purchase price of the parcels, phases or lots. The
"book value" with respect to Domestic Unimproved Land referred to in
Section 6.15 shall be calculated as if the option to purchase had been
exercised as of the date of determination, and otherwise in accordance
with Generally Accepted Accounting Principles, consistently applied.
"Eligible Assignee" means (a) another Bank, (b) any commercial
bank, savings bank, savings and loan association or similar financial
institution which, (i) has total assets of $5,000,000,000 or more, (ii)
is "well capitalized" within the meaning of such term under the Federal
Depository Institutions Control Act, (iii) is engaged in the business of
lending money and extending credit under credit facilities substantially
similar to those extended under this Agreement and (iv) is operationally
and procedurally able to meet the obligations of a Bank hereunder to the
same degree as a commercial bank, (c) any insurance company engaged in
the business of writing insurance which (i) has total assets of
$5,000,000,000 or more, (ii) is "best capitalized" under applicable
regulations of the National Association of Insurance Commissioners, and
(iii) meets the requirements set forth in subclauses (iii) and (iv) of
clause (b) above and (d) any other financial institution having total
assets of $5,000,000,000 or more
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17
(including a mutual fund or other fund under management of an investment
manager having under its management total assets of $5,000,000,000 or
more) which meets the requirements set forth in subclauses (iii) and
(iv) of clause (b) above; provided that each Eligible Assignee must (A)
be organized under the Laws of the United States of America, any state
thereof or the District of Columbia or (B) if a commercial bank, be
organized under the Laws set forth in clause (A) or under the Laws of
the Cayman Islands or any country which is a member of the Organization
for Economic Cooperation and Development, or a political subdivision of
such a country, and (C) act under the Loan Documents through a branch,
agency or funding office located in the United States of America and (D)
be exempt from withholding of tax on interest and deliver the documents
related thereto pursuant to the Code.
"ERISA" means, at any date, the Employee Retirement Income
Security Act of 1974 and the regulations thereunder, all as the same
shall be in effect at such date.
"ERISA Affiliate" means, with respect to any Person, any other
Person (or any trade or business, whether or not incorporated) that is
under common control with that Person within the meaning of Section 414
of the Code.
"Event of Default" has the meaning provided in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exposure" means for any Bank, as of any date of determination,
the product obtained by multiplying that Bank's then effective Pro Rata
Share by the then effective Commitment.
"Federal Funds Rate" means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York
(including any such successor, "H.15(519)") on the preceding Banking Day
opposite the caption "Federal funds (effective)"; or, if for any
relevant day such rate is not so published on any such preceding Banking
Day, the rate for such day will be the arithmetic mean as determined by
the Administrative Agent of the rates for the last transaction in
overnight Federal funds arranged prior to 9:00 a.m. (New York City time)
on that day by each of three leading brokers of Federal funds
transactions in New York City selected by the Administrative Agent.
"Financial Subsidiary" means (a) the Mortgage Company and its
Subsidiaries, so long as such entities continue to engage in the
mortgage banking business, (b) a Trust Issuer, so long as it engages in
no activities other than those incident to the Trust Preferred Capital
Securities, (c) any Subsidiary of Borrower that is organized and
operates solely to issue (i) collateralized mortgage obligations or (ii)
other similar asset-backed obligations, and (d) any other Subsidiary of
Borrower that (i) is engaged primarily in the business of origination,
marketing, and servicing of residential mortgage loans, the sale of
servicing rights, or the financing of long term residential mortgage
loans, (ii) holds not less than 95% of its total assets in the form of
Cash, Cash Equivalents, notes and mortgages receivable, Cash held by a
trustee for the benefit of such Subsidiary or other financial
instruments and (iii) is the subject of an Officer's Certificate of
Borrower delivered to the Administrative Agent stating that such
Subsidiary is a Financial Subsidiary within the meaning hereof. As of
the 2000 Closing Date, the Financial Subsidiaries are International
Mortgage Acceptance Corporation, KBASW Mortgage Acceptance Corporation,
KBI/Mortgage Acceptance Corporation, KBRAC IV Mortgage Acceptance
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18
Corporation, Xxxxxxx and Broad Mortgage Company, rateOne Home Loans,
LLC, Rate One Associates, Inc. and Rate One Holdings, Inc.
"Fiscal Quarter" means each of the fiscal quarters of Borrower
ending on each February 28 (or 29, if a leap year), May 31, August 31
and November 30.
"Fiscal Year" means each of the fiscal years of Borrower ending
on each November 30 or as otherwise changed by the Borrower upon advance
written notice to the Administrative Agent, but subject to the
requirements of Section 1.3.
"Fitch" means Fitch and its successors.
"Foreign Subsidiary" means, with respect to any Person, a
Subsidiary of that Person which is not a Domestic Subsidiary and with
respect to Borrower, includes Xxxxxxx and Broad International, Inc., a
California corporation.
"Generally Accepted Accounting Principles" means, as of any date
of determination, accounting principles set forth as "generally
accepted" in then currently effective Statements of the Auditing
Standards Board of the American Institute of Certified Public
Accountants, or, if such Statements are not then in effect, accounting
principles that are then approved by a significant segment of the
accounting profession in the United States of America. The term
"consistently applied," as used in connection therewith, means that the
accounting principles applied to financial statements of a Person as of
any date or for any period are consistent in all material respects
(subject to Section 1.3) to those applied to financial statements of
that Person as of recent prior dates and for recent prior periods.
"Government Securities" means (a) readily marketable direct full
faith and credit obligations of the United States of America or
obligations unconditionally guaranteed by the full faith and credit of
the United States of America and (b) obligations of an agency or
instrumentality of, or corporation owned, controlled or sponsored by,
the United States of America that are generally considered in the
securities industry to be implicit obligations of the United States of
America.
"Governmental Agency" means (a) any federal, state, county or
municipal government, or political subdivision thereof, (b) any
governmental or quasi-governmental agency, authority, board, bureau,
commission, department, instrumentality, or public body, (c) any court
or administrative tribunal, or (d) any arbitration tribunal or other
non-governmental authority to whose jurisdiction a Person has consented,
in each case whether of the United States of America or any other
nation.
"Guarantor Subsidiary" means (a) any Domestic Subsidiary which
is a Significant Subsidiary, other than any Financial Subsidiary and (b)
any other Domestic Subsidiary, other than any Financial Subsidiary, that
is designated in writing by Borrower as a Guarantor Subsidiary.
"Hazardous Materials" means substances defined as "hazardous
substances" pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq.,
or as "hazardous", "toxic" or "pollutant" substances or as "solid waste"
pursuant to the Hazardous Materials Transportation Act, 49 U.S.C.
Section 1801, et seq., the
-12-
19
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq.,
or as "friable asbestos" pursuant to the Toxic Substances Control Act,
15 U.S.C. Section 2601 et seq. or any other applicable Hazardous
Materials Law, in each case as such Laws are amended from time to time.
"Hazardous Materials Laws" means all Laws governing the
treatment, transportation or disposal of Hazardous Materials applicable
to any real Property of Borrower or its Subsidiaries.
"Indebtedness" means, with respect to any Person, (a) all
indebtedness of such Person for borrowed money, (b) that portion of the
obligations of such Person under Capital Leases which should properly be
recorded as a liability on a balance sheet of that Person prepared in
accordance with Generally Accepted Accounting Principles, (c) any
obligation of such Person that is evidenced by a promissory note or
other instrument representing an extension of credit to such Person,
whether or not for borrowed money, (d) any obligation of such Person for
the deferred purchase price of Property or services (other than trade or
other accounts payable in the ordinary course of business in accordance
with customary industry terms), (e) any obligation of the types referred
to in clauses (a) through (d) above that is secured by a Lien (other
than a Permitted Encumbrance) on assets of such Person, whether or not
that Person has assumed such obligation or whether or not such
obligation is non-recourse to the credit of such Person, but only to the
extent of the fair market value of the assets so subject to the Lien,
(f) obligations of such Person arising under acceptance facilities or
under facilities for the discount of accounts receivable of such Person
and (g) any obligation of such Person under letters of credit issued for
the account of such Person and that is not otherwise a Contingent
Guaranty Obligation.
"Intangible Assets" means assets that are considered intangible
assets under Generally Accepted Accounting Principles, including (a)
customer lists, goodwill, computer software, unamortized deferred
charges, unamortized debt discount, capitalized research and development
costs and other intangible assets and (b) any write-up in book value of
any asset subsequent to its acquisition, but excluding any existing
write-up in book value of any asset acquired by Borrower or any of its
Subsidiaries prior to the 2000 Closing Date, as such write-up may
decrease (but not increase) from time to time.
"Interest Period" means, as to each LIBOR Loan, a period of one,
two, three or six months, as designated by Borrower; provided that (a)
the first day of each Interest Period must be a LIBOR Market Day, (b)
any Interest Period that would otherwise end on a day that is not a
LIBOR Market Day shall be extended to the next succeeding LIBOR Market
Day, unless such LIBOR Market Day falls in the next calendar month, in
which case the Interest Period shall end on the next preceding LIBOR
Market Day, and (c) no Interest Period may extend beyond the Maturity
Date.
"Investment" means, with respect to any Person, any investment
by that Person, whether by means of purchase or other acquisition of
capital stock or other Securities of any other Person or by means of
loan, advance, capital contribution, or other debt or equity
participation or interest in any other Person, including any partnership
or joint venture interest in any other Person; provided that an
Investment of a Person shall not include any trade or account receivable
arising in the ordinary course of the business of such Person, whether
or not evidenced by a note or other writing. The amount of any
Investment shall be the amount
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actually invested, less any return of capital, without adjustment for
subsequent increases or decreases in the market value of such
Investment.
"Investment Grade Credit Rating" means, as of any date of
determination, that at least two (2) Rating Agencies have as of that
date issued credit ratings for Borrower's long-term senior unsecured
debt of (a) at least BBB- in the case of S&P, (b) at least Baa3 in the
case of Xxxxx'x and (c) at least BBB- in the case of Fitch.
"Joint Venture" means any Person, other than a Subsidiary, (a)
in which Borrower or any Subsidiary of Borrower holds an equity
Investment which entitles Borrower or such Subsidiary to more than 10%
of (i) the ordinary voting power for the election of the board of
directors or other governing body of such Person or (ii) the
partnership, membership or other ownership interest in such Person, and
(b) which has at least one holder of its equity interests that is not an
Affiliate of Borrower or any Subsidiary of Borrower. Notwithstanding the
foregoing, for the purposes of Section 6.16, the term "Joint Venture"
will not include any equity Investment in any Person if the dollar
amount of that investment is less than $1,000,000, computed in
accordance with Generally Accepted Accounting Principles, but only to
the extent that the aggregate dollar amount of such equity Investments
is less than $25,000,000.
"Laws" means, collectively, all foreign, federal, state and local
statutes, treaties, codes, ordinances, rules, regulations and
controlling precedents of any Governmental Agency.
"Lead Arranger and Sole Book Manager" means Banc of America
Securities LLC.
"Xxxxx Homes Stock Repurchase" means the purchase of up to 4
million shares of Borrower's common stock issued in connection with the
acquisition of the Xxxxx Homes group of companies for $26.00 per share
payable in cash or by promissory note.
"LIBOR" means, for each LIBOR Loan, that rate per annum,
determined solely by the Administrative Agent, pursuant to the following
formula (with each component expressed as a decimal and rounded upward
to the nearest 1/100 of 1%):
London Interbank Offered Rate for that LIBOR Loan
-------------------------------------------------
1.00 - Reserve Percentage
"LIBOR Advance" means an Advance made by a Bank to fund its Pro
Rata Share of a LIBOR Loan.
"LIBOR Lending Office" means, with respect to each Bank, its
office, branch or affiliate identified on the signature page hereof as
its LIBOR Lending Office or such other office, branch or affiliate as
such Bank may hereafter designate as its LIBOR Lending Office by notice
to Borrower and the Administrative Agent.
"LIBOR Loan" means a Loan made hereunder and designated or
redesignated as a LIBOR Loan in accordance with Article 2.
"LIBOR Market" means the London, England market established by
and among banks for the solicitation, offer and acceptance of Dollar
deposits in such banks.
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"LIBOR Market Day" means any Banking Day on which commercial
banks are open for international business (including dealing in Dollar
deposits) in London, England.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment for security, security interest, encumbrance, lien or charge
of any kind, whether voluntarily incurred or arising by operation of Law
or otherwise, affecting any Property, including any agreement to grant
any of the foregoing (other than an agreement which gives to a Person
the right to become equally and ratably secured with any other Person to
whom a Lien is granted on any item of Property) any conditional sale or
other title retention agreement, any lease in the nature of a security
interest, and/or the filing of or agreement to give any financing
statement (other than a precautionary financing statement with respect
to a lease that is not in the nature of a security interest) under the
Uniform Commercial Code or comparable Law of any jurisdiction with
respect to any Property.
"Loan" means the aggregate of the Advances made at any one time
by the Banks pursuant to Article 2.
"Loan Documents" means, collectively, this Agreement, the Notes,
the Subsidiary Guaranty, any Request for Loan, any Compliance
Certificate and any other instruments, documents or agreements of any
type or nature hereafter executed and delivered by Borrower or any of
its Subsidiaries or Affiliates to the Administrative Agent or any other
Bank in any way relating to or in furtherance of this Agreement, in each
case either as originally executed or as the same may from time to time
be supplemented, modified, amended, restated, extended or supplanted.
"London Interbank Offered Rate" means, for each LIBOR Loan, the
per annum rate (rounded upward to the nearest 1/100 of 1%) determined by
the Administrative Agent as the rate for deposits in Dollars for a
period equal to the applicable Interest Period which appears on the
Telerate Page 3750 as of 11:00 a.m., London time, on the date that is 2
LIBOR Market Days prior to the commencement of such Interest Period. If
such rate does not appear on the Telerate Page 3750, the rate for that
Interest Period will be determined by the Administrative Agent and will
be equal to the rate at which deposits in Dollars are offered by the
Administrative Agent to prime banks in the LIBOR Market at or about
11:00 a.m., London time, on the date that is 2 LIBOR Market Days prior
to the commencement of such Interest Period in an aggregate amount
approximately equal to the amount of the Advance to be made by the
Administrative Agent (as a Bank) with respect to such LIBOR Loan and for
a period of time comparable to the number of days in the applicable
Interest Period.
"Majority Banks" means (a) as of any date of determination if
the Commitment is then in effect, Banks having in the aggregate in
excess of 50% of the Commitment then in effect and (b) as of any date of
determination if the Commitment has then been terminated or suspended
and there is then any Indebtedness evidenced by the Notes, Banks holding
in the aggregate in excess of 50% the aggregate Indebtedness then
evidenced by the Notes.
"Material Adverse Effect" means any circumstance or event, or
any set of circumstances or events which, individually or when
aggregated with any other circumstances or events, (a) has or is
reasonably likely to have any material adverse effect upon the validity
or enforceability of any Loan Document, (b) is or is reasonably likely
to be material and adverse to the condition (financial or otherwise) or
operations of Borrower and its Subsidiaries, taken as
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a whole, or (c) materially impairs or is reasonably likely to materially
impair the ability of Borrower and its Subsidiaries, taken as a whole,
to perform the Obligations.
"Material Amount of Assets" means, as of any date of
determination, more than 10% of the consolidated total assets (other
than assets of Financial Subsidiaries) of Borrower and its Subsidiaries
as of such date.
"Maturity Date" means October 6, 2005.
"Model Homes" means housing units which have been completed,
furnished and landscaped and are used in the marketing efforts with
respect to a residential home community, provided that the total number
of units considered as Model Homes at any time shall not exceed an
amount equal to (a) the number of domestic residential home communities
open for sale at such time, times (b) four (4).
"Money Market Facility" means any unsecured credit facility the
advances under which have a maturity of not in excess of 180 days and
which have been extended to Borrower from time to time other than under
this Agreement, either by a Bank or by any other financial institution.
"Xxxxx'x" means Xxxxx'x Investor's Service, Inc. and its
successors.
"Mortgage Company" means Xxxxxxx and Broad Mortgage Company, an
Illinois corporation and a wholly owned Financial Subsidiary of
Borrower.
"Mortgage Warehousing Agreements" mean that certain Amended and
Restated Mortgage Loan Warehousing Agreement dated as of February 18,
2000 among Mortgage Company, rateOne, the banks party thereto and Bank
of America, N.A., as administrative agent, and Bank One Texas, N.A., as
managing agent, and that certain Master Loan and Security Agreement
dated as of May 25, 1999 between Mortgage Company and Xxxxxx Xxxxxxx
Mortgage Capital, Inc., as lender, as amended by Amendment No. 1 to
Master Loan and Security Agreement, dated as of May 19, 2000, among
Mortgage Company, rateOne and Xxxxxx Xxxxxxx Mortgage Capital, Inc., as
the foregoing may from time to time be amended, modified, refinanced or
replaced, and substantially similar loan or credit agreements or
arrangements entered into from time to time by Mortgage Company for
loans to be used for the purpose of funding the origination of
residential mortgage loans, secured by a pledge of such mortgage loans.
"Multiemployer Plan" means any employee benefit plan of a type
described in Section 4001(a)(3) of ERISA.
"Net Orders" means, as of any date of determination, the number
of items of housing inventory that are in the process of being sold and
with respect to which a purchase contract has been signed, as reported
in Borrower's filings with the Commission.
"Net Realizable Value Adjustment" means the adjustment required
pursuant to Generally Accepted Accounting Principles (including FAS 121
issued by the Financial Accounting Standards Board) to reflect a
decrease in the book value of assets below their historical costs.
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23
"New Bank" has the meaning set forth in Section 2.6(a).
"Non-Recourse Indebtedness" means Indebtedness incurred in
connection with the purchase or improvement of Property (a) that is
secured solely by the Property purchased or improved, (b) with respect
to which the holder of such Indebtedness has recourse only to such
Property, and (c) that is otherwise non-recourse (whether by contract or
under applicable Law) to any Person.
"Note" means each promissory note made by Borrower to a Bank
evidencing the Advances under that Bank's Pro Rata Share of the
Commitment, substantially in the form of Exhibit C, either as originally
executed or as the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"Obligations" means all present and future obligations of every
kind or nature of Borrower or any Party at any time and from time to
time owed to the Administrative Agent or the Banks or any one or more of
them under any one or more of the Loan Documents, whether due or to
become due, matured or unmatured, liquidated or unliquidated, or
contingent or noncontingent, including obligations of performance as
well as obligations of payment, and including interest that accrues to
the extent permitted by applicable Law after the commencement of any
proceeding under any Debtor Relief Law by or against Borrower.
"Officer's Certificate" means, when used with reference to any
Person, a certificate signed by a Senior Officer of such Person.
"Operating Loss" means, for any Fiscal Quarter, that the sum of
(a) Consolidated Net Income for that Fiscal Quarter plus (b) all taxes
on or measured by income payable by Borrower with respect to such
Consolidated Net Income plus (c) all non-Cash Net Realizable Value
Adjustments made during that Fiscal Quarter is less than zero; provided
that each amount described in clauses (a), (b) and (c) shall be
adjusted to eliminate any portion thereof, or effect thereon,
attributable to a Financial Subsidiary.
"Opinions of Counsel" means the favorable written legal opinions
of (a) Xxxxxx, Xxxxxx & Xxxxx LLP, special counsel to Borrower, and (b)
Xxxxxx X. Xxxxxxx, Senior Vice President and General Counsel of Borrower
substantially in the form of Exhibits D-1 and D-2, respectively,
together with copies of all factual certificates and legal opinions upon
which such counsel has relied.
"Party" means any Person other than the Banks or the Agents
which now or hereafter is a party to any of the Loan Documents.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto established under ERISA.
"Pension Plan" means any "employee pension benefit plan" (as
such term is defined in ERISA) which is subject to Title IV of ERISA and
which is maintained for employees of Borrower or any of its ERISA
Affiliates.
"Permitted Encumbrances" means:
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(a) inchoate Liens incident to construction or maintenance of
real property; or Liens incident to construction or maintenance of real
property now or hereafter filed of record for which adequate reserves
have been set aside and which are being contested in good faith by
appropriate proceedings and have not proceeded to judgment, provided
that, by reason of nonpayment of the obligations secured by such Liens,
no material property is subject to a material risk of loss or
forfeiture;
(b) Liens for taxes and assessments on real property which are
not yet past due; or Liens for taxes and assessments on real property
for which adequate reserves have been set aside and are being contested
in good faith by appropriate proceedings and have not proceeded to
judgment, provided that, by reason of nonpayment of the obligations
secured by such Liens, no material property is subject to a material
risk of loss or forfeiture;
(c) minor defects and irregularities in title to any real
property which in the aggregate do not materially impair the fair market
value or use of the real property for the purposes for which it is or
may reasonably be expected to be held;
(d) easements, exceptions, reservations, or other agreements for
the purpose of pipelines, conduits, cables, wire communication lines,
power lines and substations, streets, trails, walkways, drainage,
irrigation, water, utilities, and sewerage purposes, dikes, canals,
ditches, the removal of oil, gas, coal, or other minerals, and other
like purposes affecting real property, facilities, or equipment which in
the aggregate do not materially burden or impair the fair market value
or use of such property for the purposes for which it is or may
reasonably be expected to be held;
(e) easements, exceptions, reservations, or other agreements for
the purpose of facilitating the joint or common use of property
affecting real property which in the aggregate do not materially burden
or impair the fair market value or use of such property for the purposes
for which it is or may reasonably be expected to be held;
(f) rights reserved to or vested in any Governmental Agency to
control or regulate the use of any real property;
(g) any obligations or duties affecting any real property to any
Governmental Agency with respect to any right, power, franchise, grant,
license, or permit;
(h) present or future zoning laws and ordinances or other laws
and ordinances restricting the occupancy, use, or enjoyment of real
property;
(i) statutory Liens, including warehouseman's liens, other than
those described in clauses (a) or (b) above, arising in the ordinary
course of business with respect to obligations which are not delinquent
or are being contested in good faith, provided that, if delinquent,
adequate reserves have been set aside with respect thereto and, by
reason of nonpayment, no material property is subject to a material risk
of loss or forfeiture;
(j) covenants, conditions, and restrictions affecting the use of
real property which in the aggregate do not materially impair the fair
market value or use of the real property for the purposes for which it
is or may reasonably be expected to be held;
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(k) rights of tenants under leases and rental agreements covering
real property entered into in the ordinary course of business of the
Person owning such real property;
(l) Liens consisting of pledges or deposits to secure obligations
under workers' compensation laws or similar legislation, including Liens
of judgments thereunder which are not currently dischargeable;
(m) Liens consisting of pledges or deposits of property to secure
performance in connection with operating leases made in the ordinary
course of business to which the Borrower or a Subsidiary is a party as
lessee, provided the aggregate value of all such pledges and deposits in
connection with any such lease does not at any time exceed 25% of the
annual fixed rentals payable under such lease;
(n) Liens consisting of deposits of property to secure statutory
obligations of the Borrower or a Subsidiary of Borrower in the ordinary
course of its business; and
(o) Liens consisting of deposits of property to secure (or in
lieu of) surety, appeal or customs bonds in proceedings to which
Borrower or a Subsidiary of Borrower is a party in the ordinary course
of its business.
"Permitted Right of Others" means a Right of Others consisting
of (a) an interest (other than a legal or equitable co-ownership
interest, an option or right to acquire a legal or equitable
co-ownership interest and any interest of a ground lessor under a ground
lease), that does not materially impair the value or use of property for
the purposes for which it is or may reasonably be expected to be held,
(b) an option or right to acquire a Lien that would be a Permitted
Encumbrance or (c) the reversionary interest of a landlord under a lease
of Property.
"Person" means an individual, trustee, corporation, general
partnership, limited partnership, limited liability company, joint stock
company, trust, estate, unincorporated organization, union, tribe,
business association or firm, joint venture, Governmental Agency, or
other entity.
"Pricing Period" means the 3 calendar month periods of (a) May 1
through July 31, (b) August 1 through October 31, (c) November 1 through
January 31, and (d) February 1 through April 30, and the Consolidated
Leverage Ratio applicable to any Pricing Period shall be the one that is
calculated as of the Fiscal Quarter end that falls approximately 60 days
prior to the beginning of such Pricing Period.
"Prime Rate" means, on any day, the rate of interest per annum
then most recently established by the Administrative Agent as its "prime
rate." Any such rate is a general reference rate of interest, may not be
related to any other rate, and may not be the lowest or best rate
actually charged by the Administrative Agent to any customer or a
favored rate and may not correspond with future increases or decreases
in interest rates charged by other lenders or market rates in general,
and that the Administrative Agent may make various business or other
loans at rates of interest having no relationship to such rate. If the
Administrative Agent ceases to exist or to establish or publish a prime
rate from which the Prime Rate is then determined, the applicable
variable rate from which the Prime Rate is determined thereafter shall
be instead the prime rate reported in The Wall Street Journal (or the
average prime rate if a high and a low
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prime rate are therein reported), and the Prime Rate shall change
without notice with each change in such prime rate as of the date such
change is reported. If The Wall Street Journal does not then or ceases
to report such a prime rate, the Prime Rate shall thereafter be
determined by such alternate method as may be reasonably selected by the
Administrative Agent.
"Prime Rate Advance" means an Advance made by a Bank to fund its
Pro Rata Share of a Prime Rate Loan.
"Prime Rate Loan" means a Loan made hereunder and designated or
redesignated as a Prime Rate Loan in accordance with Article 2, or
converted to a Prime Rate Loan in accordance with Article 3.
"Prior Loan Agreements" means the Bridge Loan Agreement, the
Prior Revolving Loan Agreement and the Prior Term Loan Agreement.
"Prior Revolving Loan Agreement" means the 1997 Revolving Loan
Agreement dated as of April 21, 1997, as amended, by and among Borrower,
the Banks named therein, and Bank of America, as Administrative Agent
and various other Banks in various agent capacities.
"Prior Term Loan Agreement" has the meaning set forth for that
term in the Recitals hereto.
"Pro Rata Share" of a Bank, as pertains to the Commitment, means
the applicable percentage set forth opposite the name of that Bank on
Schedule 1.1 to this Agreement.
"Projections" means the financial projections of Borrower
delivered to the Banks and dated as of August 24, 2000.
"Property" means any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"rateOne" means rateOne Home Loan, LLC, a Delaware limited
liability company and a Subsidiary of Mortgage Company.
"Rating Agencies" means S&P, Xxxxx'x and Fitch.
"Regulation D" means Regulation D, as at any time amended, of
the Board of Governors of the Federal Reserve System or any other
regulation in substance substituted therefor.
"Regulatory Development" means (a) any change in the Laws, (b)
change in the application of any existing Laws or the interpretation
thereof by any Governmental Agency or central bank or comparable
authority (whether or not having the force of Law), or (c) compliance by
any Bank with any request or directive (whether or not having the force
of Law) of any Governmental Agency or central bank or comparable
authority.
"Request for Loan" means a request for a Loan signed by a
Responsible Official of Borrower, in a form reasonably designated from
time to time by the Administrative Agent.
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"Request for Redesignation" means a written request for
redesignation of Loans signed by a Responsible Official of Borrower, in
a form reasonably designated from time to time by the Administrative
Agent.
"Requirement of Law" means, as to any Person, any Law or any
judgment, award, decree, writ or determination of, or any consent or
similar agreement with, a Governmental Agency, in each case applicable
to or binding upon such Person or any of its Property or to which such
Person or any of its Property is subject.
"Reserve Percentage" means, for each LIBOR Loan, the total of the
maximum reserve percentages for determining the reserves to be
maintained by member banks of the Federal Reserve System for
Eurocurrency Liabilities, as defined in Regulation D. The Reserve
Percentage shall be expressed in decimal form and rounded upward, if
necessary, to the nearest 1/100th of one percent, and shall include
marginal, emergency, supplemental, special and other reserve
percentages. The Reserve Percentage shall be determined solely by the
Administrative Agent, which determination shall be conclusive absent
manifest error.
"Responsible Official" means (a) when used with reference to a
Person other than an individual, any corporate officer of such Person,
general partner of such Person, corporate officer of a corporate general
partner of such Person, or corporate officer of a corporate general
partner of a partnership that is a general partner of such Person, or
any other responsible official thereof duly acting on behalf thereof,
and (b) when used with reference to a Person who is an individual, such
Person. Any document or certificate hereunder that is signed or executed
by a Responsible Official of a Person shall be conclusively presumed to
have been authorized by all necessary corporate, partnership and/or
other action on the part of that Person.
"Revolving Loan Commitment Increases" means the aggregate of
increases to the Commitment requested under Section 2.8 of the 2000
Revolving Loan Agreement.
"Revolving Loan Exposure" means for any Bank, as of any date of
determination, the product obtained by multiplying that Bank's then
effective Pro Rata Share under the 2000 Revolving Loan Agreement by the
then effective Commitment under the 2000 Revolving Loan Agreement.
"Right of Others" means, with respect to any Property in which a
Person has an interest, (a) any legal or equitable claim or other
interest (other than a Lien) in or with respect to that Property held by
any other Person, and (b) any option or right held by any other Person
to acquire any such claim or other interest (including a Lien).
"S&P" means Standard & Poor's Rating Group (a division of
XxXxxx-Xxxx, Inc.) and its successors.
"Securities" means any capital stock, share, voting trust
certificate, bonds, debentures, notes or other evidences of
indebtedness, limited partnership interests, or any warrant, option or
other right to purchase or acquire any of the foregoing.
"Senior Officer" means the (a) chief executive officer, (b) chief
operating officer, (c) chief financial officer, (d) vice president and
controller, or (e) treasurer, in each case whatever the title
nomenclature may be, of the Person designated.
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"Settlement Date" means the settlement date specified in the
forward contract for the sale and purchase of Common Stock which is a
component of any Trust Preferred Capital Securities. The Settlement Date
for the Trust Preferred Capital Securities referred to in clause (a) of
the definition thereof is August 16, 2001.
"Shareholders' Equity" means, as of any date of determination,
shareholders' equity as of that date determined in accordance with
Generally Accepted Accounting Principles; provided that there shall be
excluded from Shareholders' Equity any amount attributable to capital
stock that is, directly or indirectly, required to be redeemed or
repurchased by the issuer thereof prior to the date which is one year
after the Maturity Date or upon the occurrence of specified events or at
the election of the holder thereof.
"Significant Subsidiary" means, as of May 31 2000, those
Subsidiaries of Borrower identified as such in Schedule 4.4 and, as of
any other date of determination, any Subsidiary of Borrower (other than
a Joint Venture) with respect to which any of the following conditions
is met:
(a) the aggregate book value of all Investments of Borrower and
its Subsidiaries in such Subsidiary exceeds 5% of the consolidated total
assets (other than assets of Financial Subsidiaries) of Borrower and its
Subsidiaries as of such date; or
(b) the proportionate share of Borrower and its Subsidiaries in
the total assets of such Subsidiary (after intercompany eliminations)
exceeds 5% of the consolidated total assets (other than assets of
Financial Subsidiaries) of Borrower and its Subsidiaries as of such
date; or
(c) the equity of Borrower and its Subsidiaries in the net income
of such Subsidiary (before income taxes, extraordinary items and
cumulative effect of a change in accounting principles) as of the end of
the most recently ended fiscal year of such Subsidiary exceeds the
greater of (i) an amount equal to 5% of the consolidated net income of
Borrower and its Subsidiaries (computed as aforesaid) as of the end of
the most recent Fiscal Year ended prior to such date or (ii) $3,000,000.
"Subordinated Obligations" means, collectively, all obligations
of Borrower or any of its Subsidiaries that (a) do not provide for any
payment of principal, any sinking fund payment or any scheduled
redemption prior to the Maturity Date, (b) are expressly subordinated to
the Obligations by a written instrument containing subordination and
related provisions (including interest payment blockage, standstill and
related provisions) not materially less favorable to the Banks in any
respect whatsoever from those applicable to Borrower's 9-5/8% Senior
Subordinated Notes due 2006 (the "Subordinated Notes") (or such other
subordination and related provisions as may be approved in writing by
the Majority Banks), (c) are subject to financial covenants not
materially more burdensome to Borrower taken as a whole than those
applicable to the Subordinated Notes, except such covenants as may be
approved in writing by the Majority Banks and (d) are subject to other
covenants (other than the covenant to pay interest) and events of
default which in the aggregate are not materially more burdensome to
Borrower than those applicable to the Subordinated Notes, except such
covenants or events of default as may be approved in writing by the
Majority Banks.
"Subsidiary" means, with respect to any Person, any corporation,
limited liability company, partnership or joint venture whether now
existing or hereafter organized or acquired:
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(a) in the case of a corporation or limited liability company, of which
securities having a majority of the ordinary voting power for the
election of the board of directors (other than securities having such
power only by reason of the happening of a contingency) are at the time
owned by such Person and/or one or more Subsidiaries of such Person or
(b) in the case of a partnership, joint venture or other business
entity, in which such Person or a Subsidiary of such Person is a general
partner.
"Subsidiary Guaranty" means the guaranty of the Indebtedness of
Borrower under this Agreement executed by each Guarantor Subsidiary of
Borrower substantially in the form of Exhibit E, either as originally
executed or as the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"Syndication Agent" means Credit Lyonnais Los Angeles Branch, so
long as such bank is a Bank hereunder. The Syndication Agent shall have
no duties under the Loan Documents beyond those of a Bank.
"Termination Event" means (a) a "reportable event" as defined in
Section 4043 of ERISA (other than a "reportable event" that is not
subject to the provision for 30 day notice to the PBGC), (b) the
withdrawal of Borrower or any of its ERISA Affiliates from a Pension
Plan during any 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 a Pension Plan or the treatment of an amendment to a
Pension Plan as a termination thereof pursuant to Section 4041 of ERISA,
other than pursuant to Section 4041(b) of ERISA, (d) the institution of
proceedings to terminate a Pension Plan by the PBGC or (e) any other
event or condition which might reasonably be expected to constitute
grounds under ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan.
"to the best knowledge of" means, when modifying a
representation, warranty or other statement of any Person, that such
representation, warranty or statement is a representation, warranty or
statement that (a) the Person making it has no actual knowledge of the
inaccuracy of the matters therein stated and (b) assuming the exercise
by the Person making it of reasonable due diligence under the
circumstances (in accordance with the standard of what a reasonable
Person would have done under similar circumstances), the Person making
it would have no actual knowledge of the inaccuracy of the matters
therein stated. Where the Person making the representation, warranty or
statement is not a natural Person, the aforesaid actual or constructive
knowledge shall be that of any Senior Officer of that Person.
"Trust Issuer" means a business trust formed by Borrower as a
special purpose grantor trust for the purpose of facilitating the
issuance of Trust Preferred Capital Securities, and which engages in no
activities other than those incident to the Trust Preferred Capital
Securities.
"Trust Preferred Capital Securities" means the securities issued
by Borrower and a Trust Issuer (a) covered by Borrower's Prospectus
dated June 30, 1998 filed with the Commission and (b) such other similar
securities as may from time to time be issued by Borrower after being
approved in writing by the Majority Banks in their sole and absolute
discretion to be treated as Trust Preferred Capital Securities.
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"Voting Stock" means, with respect to any Person, the capital
stock of such Person having general voting power under ordinary
circumstances to elect at least a majority of the board of directors,
managers or trustees of such Person (irrespective of whether or not at
the time capital stock of any other class or classes shall have or might
have voting power by reason of the happening of any contingency).
1.2 Use of Defined Terms. Any defined term used in the plural
preceded by the definite article shall be taken to encompass all members of the
relevant class. Any defined term used in the singular preceded by "any" shall be
taken to indicate any number of the members of the relevant class.
1.3 Accounting Terms. All accounting terms not specifically defined
in this Agreement shall be construed in conformity with, and all financial data
required to be submitted by this Agreement shall be prepared in conformity with,
Generally Accepted Accounting Principles, consistently applied, except as
otherwise specifically prescribed herein. In the event that Generally Accepted
Accounting Principles change during the term of this Agreement such that the
financial covenants contained in Sections 6.9, 6.10 or 6.11 would then be
calculated in a different manner or with different components or would render
the same not meaningful criteria for evaluating Borrower's financial condition,
(a) Borrower and the Banks agree to amend this Agreement in such respects as are
necessary to conform those covenants as criteria for evaluating Borrower's
financial condition to substantially the same criteria as were effective prior
to such change in Generally Accepted Accounting Principles and (b) Borrower
shall be deemed to be in compliance with the financial covenants contained in
such Sections during the 90 day period following such change in Generally
Accepted Accounting Principles if and to the extent that Borrower would have
been in compliance therewith under Generally Accepted Accounting Principles as
in effect immediately prior to such change. In the event that the Borrower
changes its Fiscal Year during the term of this Agreement, Borrower and the
Banks agree to amend this Agreement and the other Loan Documents in such
respects as are necessary to conform the definitions, the financial covenants,
the reporting requirements and the other provisions thereof to fairly reflect
such change in the Borrower's Fiscal Year.
1.4 Rounding. Any financial ratios required to be maintained by
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed in this
Agreement and rounding the result up or down to the nearest number (with a
round-up if there is no nearest number) to the number of places by which such
ratio is expressed in this Agreement.
1.5 Miscellaneous Terms. The term "or" is disjunctive; the term
"and" is conjunctive. The term "shall" is mandatory; the term "may" is
permissive. Masculine terms also apply to females; feminine terms also apply to
males. The term "including" is by way of example and not limitation.
1.6 Exhibits and Schedules. All Exhibits and Schedules to this
Agreement, either as originally existing or as the same may from time to time be
supplemented, modified, or amended, are incorporated herein by reference. A
matter disclosed on any Schedule shall be deemed disclosed on all Schedules.
1.7 References to "Borrower and its Subsidiaries". Any reference
herein to "Borrower and its Subsidiaries" or the like shall refer solely to
Borrower during such times, if any, as Borrower shall have no Subsidiaries.
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Article 2
LOANS
2.1 Loans-General.
(a) Subject to the terms and conditions set forth in this
Agreement, on the 2000 Closing Date, each Bank shall, pro rata according
to that Bank's Pro Rata Share of the Commitment, make Advances, to
Borrower under the Commitment in such amounts as Borrower may request in
one or more Request(s) for Loan(s); provided that after giving effect to
such Advance(s), the aggregate outstanding principal evidenced by the
Notes shall equal but not exceed the Commitment. Borrower may not borrow
under this Section 2.1(a) subsequent to the 2000 Closing Date, or repay
and reborrow under this Section 2.1(a).
(b) Subject to the next sentence, each Loan shall be made
pursuant to a Request for Loan which shall be in a form and shall
contain information specified from time to time by the Administrative
Agent and which shall specify the requested (i) date of such Loan, (ii)
type of Loan, (iii) amount of such Loan and (iv) in the case of a LIBOR
Loan, Interest Period for such Loan. Unless the Administrative Agent, in
its sole and absolute discretion, has notified Borrower to the contrary,
each Loan may be requested by telephone (promptly confirmed in writing)
or telecopier by a Responsible Official of Borrower, and Borrower shall
confirm such request by promptly mailing a Request for Loan conforming
to the preceding sentence to the Administrative Agent.
(c) Promptly following receipt of a Request for Loan, the
Administrative Agent shall notify each Bank by telephone, telecopier or
telex of the date and type of the Loan, the applicable Interest Period
in the case of a LIBOR Loan, and that Bank's Pro Rata Share of the Loan.
Not later than 11:00 a.m., California time, on the date specified for
any Loan, each Bank shall make its Pro Rata Share of the Loan in
immediately available funds available to the Administrative Agent at the
Administrative Agent's Office. Upon fulfillment of the applicable
conditions set forth in Article 8, all Advances shall be credited in
immediately available funds to the Designated Deposit Account.
(d) The principal amount of each Loan shall be an integral
multiple of $1,000,000 and shall be in an amount not less than (i)
$1,000,000 if such Loan is a Prime Rate Loan and (ii) $5,000,000 if such
Loan is a LIBOR Loan.
(e) A Request for Loan shall be irrevocable upon the
Administrative Agent's first notification thereof. The obligation of
each Bank to make any Advance is several, and not joint or joint and
several, and is not conditioned upon the performance by any other Bank
of its obligation to make Advances. The failure by any Bank to perform
its obligation to make any Advance will not increase the obligation of
any other Bank to make Advances.
(f) Borrower may redesignate a Prime Rate Loan as a LIBOR Loan,
or a LIBOR Loan as a Prime Rate Loan or a LIBOR Loan with a new Interest
Period, by delivering a Request for Redesignation to the Administrative
Agent, within the time periods and pursuant to the conditions set forth
in Section 2.1(b), 2.2 or 2.3, as applicable, and elsewhere in this
Agreement. If no Request for Redesignation (or telephonic or other
request referred to in the second sentence of Section 2.1(b), if
applicable) has been made prior to the last day of the Interest Period
for an outstanding LIBOR Loan within the requisite notice periods set
forth in
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Section 2.3, then Borrower shall be deemed to have requested that such
LIBOR Loan be redesignated as a Prime Rate Loan.
(g) The Advances made by each Bank on the 2000 Closing Date shall
be evidenced by that Bank's Note.
2.2 Prime Rate Loans. Each request by Borrower for a Prime Rate Loan
shall be made pursuant to a Request for Loan (or telephonic or other request for
loan referred to in the second sentence of Section 2.1(b), if applicable)
received by the Administrative Agent, at the Administrative Agent's Office, not
later than 9:00 a.m., California time, on the Banking Day on which the requested
Prime Rate Loan is to be made. The Administrative Agent shall notify each Bank
of a request for a Prime Rate Loan as soon as practicable after receipt of the
same. All Loans shall constitute Prime Rate Loans unless properly designated as
LIBOR Loans pursuant to Section 2.3.
2.3 LIBOR Loans.
(a) Each request by Borrower for a LIBOR Loan shall be made
pursuant to a Request for Loan (or telephonic or other request for loan
referred to in the second sentence of Section 2.1(b), if applicable)
received by the Administrative Agent, at the Administrative Agent's
Office, not later than 9:00 a.m., California time, at least 3 LIBOR
Market Days before the first day of the applicable Interest Period,
provided that such advance notice period may be reduced by the
Administrative Agent in its discretion with respect to any LIBOR Loan
made on the 2000 Closing Date. The Administrative Agent shall notify
each Bank of a request for a LIBOR Loan as soon as practicable after
receipt of the same.
(b) At or about 10:00 a.m., California time, 2 LIBOR Market Days
before the first day of the applicable Interest Period, the
Administrative Agent shall determine the applicable LIBOR (which
determination shall be conclusive in the absence of manifest error) and
promptly shall give notice of the same to Borrower and the Banks by
telephone, telecopier or, in the case of Banks, telex.
(c) No more than 10 LIBOR Loans may be outstanding at any
particular time.
(d) Unless the Majority Banks otherwise consent, no LIBOR Loan
may be requested during the continuance of an Event of Default.
2.4 Initial Request for Loan.
The Borrower's initial Request(s) for Loan on the 2000 Closing Date
shall be in an aggregate amount equal to the full amount of the Commitment.
2.5 Administrative Agent's Right to Assume Funds Available. Unless
the Administrative Agent shall have been notified by any Bank at least two hours
prior to the funding by the Administrative Agent of each Loan that such Bank
does not intend to make available to the Administrative Agent such Bank's Pro
Rata Share of such Loan, the Administrative Agent may, in its discretion (but
shall not be so obligated), assume that such Bank has made such amount available
to the Administrative Agent on the date of the Loan and the Administrative Agent
may, in reliance upon such assumption, make available to Borrower a
corresponding amount. If such corresponding amount is not in fact made available
to the Administrative Agent by such Bank, the Administrative Agent shall be
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entitled to recover such corresponding amount on demand from such Bank, which
demand shall be made in a reasonably prompt manner. If such Bank does not pay
such corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent promptly shall notify Borrower and Borrower
shall pay such corresponding amount to the Administrative Agent. The
Administrative Agent shall also be entitled to recover from such Bank interest
on such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Administrative Agent to Borrower
to the date such corresponding amount is recovered by the Administrative Agent,
at a rate per annum equal to the Federal Funds Rate as notified by the
Administrative Agent to such Bank or the Borrower, as the case may be. Nothing
herein shall be deemed to relieve any Bank from its obligation to fulfill its
Pro Rata Share of the Commitment hereunder or to prejudice any rights which the
Administrative Agent or Borrower may have against any Bank as a result of any
default by such Bank hereunder.
2.6 Optional Increase to Commitment.
(a) Subject to the limitations set forth in this Section, during
the period beginning on the 2000 Closing Date and ending 6 months prior
to the Maturity Date, if no Default or Event of Default then exists,
Borrower may from time to time request in writing that the Commitment be
increased to an aggregate amount that is not greater than $175,000,000
less Revolving Loan Commitment Increases. Any such increase shall be
accomplished by (i) the addition of new Banks who qualify as Eligible
Assignees that are reasonably acceptable to the Administrative Agent
(each, a "New Bank") or (ii) one or more of the existing Banks
increasing its Exposure in accordance with the provisions of this
Section. Each such increase shall be effective, if at all, not later
than 6 months prior to the Maturity Date.
(b) Any request under this Section shall be submitted by the
Borrower to the Administrative Agent, shall specify the proposed
effective date and amount of such increase and be accompanied by (i) a
certificate signed by a Responsible Official of the Borrower, stating
that no Default or Event of Default exists as of the date of the request
or will result from the requested increase and (ii) a written consent to
the increase in the amount of the Commitment executed by each Guarantor
Subsidiary. No consent of the Banks shall be required for an increase in
the amount of the Commitment pursuant to this Section. The
Administrative Agent shall prepare and circulate to the Borrower and
Banks a new Schedule 1.1 after each increase in the Commitment.
(c) No Bank shall be obligated to increase the amount of its
Exposure, nor shall any Bank have the right to do so unless designated
by the Borrower.
(d) Each New Bank designated by the Borrower and reasonably
acceptable to the Administrative Agent shall become an additional party
hereto as a New Bank concurrently with the effectiveness of the proposed
increase in the Commitment upon its execution of an instrument of
joinder to this Agreement which is in form and substance acceptable to
the Administrative Agent and which, in any event, contains the
representations, warranties, indemnities and other protections afforded
to the Administrative Agent and the other Banks which would be granted
or made by an Eligible Assignee by means of the execution of an
Assignment and Acceptance.
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(e) Subject to the foregoing, any increase to the Commitment
requested under this Section shall be effective as of the effective date
proposed by the Borrower (but not later than 6 months prior to the
Maturity Date) and shall be in the principal amount equal to (i) the
amount that consenting Banks have agreed to assume as increases to the
amount of their respective Exposures plus (ii) the amount that any New
Banks have agreed to be the amount of their respective Exposures.
(f) Concurrently with the effectiveness of any increase to the
Commitment under this Section, each New Bank and each existing Bank
which has increased its Exposure shall make additional Advances
available to the Administrative Agent (the proceeds of which shall be
paid to the other Banks or used in part to refinance expiring LIBOR
Loans) in the amount required to result in the aggregate outstanding
Advances of each Bank being equal to its Pro Rata Share of the
Commitment, as so increased.
(g) The Borrower confirms (i) its obligation pursuant to Section
3.5(d) to repay any breakage fees resulting from the prepayment of any
LIBOR Loans resulting under this Section, and (ii) that unless the
initial Loans being made by each New Bank and each Bank increasing its
Exposure under this Section are LIBOR Loans being made by all of the
Banks in accordance with their respective Pro Rata Shares, then the
initial Loans by the New Banks and by each increasing Bank shall be
Prime Rate Loans.
(h) No amount borrowed by the Borrower pursuant to this Section
2.6 may be repaid and reborrowed.
(i) Notwithstanding any other provision of this Agreement or the
2000 Revolving Loan Agreement, the Borrower agrees that it will not
exercise its rights under this Section 2.6 unless and until the sum
(such sum being referred to as "Collective Exposure") of Bank of
America's Exposure and its "Exposure" (as defined in the 2000 Revolving
Loan Agreement) is reduced to $200,000,000 or less. Thus, Bank of
America must first assign or grant participations in at least
$43,000,000 of its Collective Exposure before the Borrower may exercise
its rights under this Section 2.6. Bank of America agrees to waive any
LIBOR breakage fees that may be owing to it (but not to any other Bank)
with respect to any assignment or participation by it of the first
$43,000,000 of its Collective Exposure. Bank of America may from time to
time, in its sole and absolute discretion, waive the application of this
Section 2.6(i) with respect to a particular increase in the Commitment
pursuant to this Section 2.6, but any such waiver(s) shall not affect
the continuing enforceability of this Section 2.6(i).
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Article 3
PAYMENTS AND FEES
3.1 Principal and Interest
(a) Interest shall be payable on the outstanding daily unpaid
principal amount of each Advance from the date of such Advance until
payment in full and shall accrue and be payable at the rates set forth
herein, to the extent permitted by applicable Laws, before and after
default, before and after maturity, before and after any judgment, and
before and after the commencement of any proceeding under any Debtor
Relief Law, with interest on overdue interest to bear interest at the
Default Rate.
(b) Interest accrued on each Prime Rate Loan shall be due and
payable on the last day of each calendar month. Except as otherwise
provided in Section 3.6, the unpaid principal amount of any Prime Rate
Loan shall bear interest at a fluctuating rate per annum equal to the
sum of the Prime Rate plus the Applicable Prime Rate Spread. Each change
in the interest rate hereunder shall take effect simultaneously with the
corresponding change in the Prime Rate. Each change in the Prime Rate
shall be effective as of the Banking Day on which the change in the
Prime Rate is announced, unless otherwise specified in such
announcement, in which case the change shall be effective as so
specified.
(c) Interest accrued on each LIBOR Loan with an Interest Period
of one month shall be due and payable on the last day of the related
Interest Period. Interest accrued on each LIBOR Loan with an Interest
Period in excess of one month shall be due and payable on the last day
of each calendar month and on the last day of the related Interest
Period. Except as otherwise provided in Section 3.6, the unpaid
principal amount of any LIBOR Loan shall bear interest at a rate per
annum equal to the sum of LIBOR for that LIBOR Loan plus the Applicable
LIBOR Spread.
(d) If not sooner paid, the principal Indebtedness evidenced by
the Notes shall be immediately payable in Cash on the Maturity Date.
(e) The Notes may, at any time and from time to time, voluntarily
be prepaid at the election of Borrower in whole or in part without
premium or penalty; provided that: (i) any partial prepayment shall be
in integral multiples of $1,000,000, (ii) any partial prepayment shall
be in an amount not less than $1,000,000 on a Prime Rate Loan, and not
less than $5,000,000 on a LIBOR Loan, (iii) the Administrative Agent
must have received written notice (or telephonic notice confirmed
promptly in writing) of any prepayment at least three Banking Days
before the date of prepayment in the case of a LIBOR Loan and by 10:00
a.m., California time, on the date of prepayment in the case of a Prime
Rate Loan, (iv) each prepayment of principal, except for partial
prepayments on Prime Rate Loans, shall be accompanied by prepayment of
interest accrued to the date of payment on the amount of principal paid
and (v) in the case of any prepayment of any LIBOR Loan, Borrower shall
promptly upon demand reimburse each Bank for any loss or cost directly
or indirectly resulting from the prepayment, determined as set forth in
Section 3.5.
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(f) Change in Control.
(i) If a Change in Control shall have occurred, at the option
of the Majority Banks, Borrower shall repay in Cash the entire
principal Indebtedness evidenced by the Notes, together with
interest thereon and all other amounts due in connection with the
Notes and this Agreement (the "Change in Control Repayment"), on
the date that is no more than 27 Banking Days after the
occurrence of the Change in Control (the "Change in Control
Payment Date"), subject to receipt by Borrower of a Change in
Control Payment Notice as set forth in Section 3.1(f)(iii). On
the Change in Control Payment Date, the Commitment shall
automatically terminate.
(ii) Within 15 Banking Days after the occurrence of a Change
in Control, Borrower shall provide written notice of the Change
in Control to the Administrative Agent and each Bank. The notice
shall state:
(A) the events causing a Change in Control and the date of
such Change in Control;
(B) the date by which the Change in Control Payment Notice
(as defined in Section 3.1(f)(iii)) must be given; and
(C) the Change in Control Payment Date.
(iii) At the direction of the Majority Banks, the
Administrative Agent shall, on behalf of the Banks, exercise the
rights specified in Section 3.1(f)(i) by delivery of a written
notice (a "Change in Control Payment Notice") to Borrower at any
time prior to or on the Change in Control Payment Date, stating
that the Notes shall be prepaid on the Change in Control Payment
Date. On the Change in Control Payment Date, Borrower shall make
the Change in Control Repayment to the Administrative Agent for
the benefit of the Banks.
3.2 Upfront Fee. In addition to fees specified in the letter
referred in Section 3.3, on the 2000 Closing Date, Borrower shall pay to the
Administrative Agent, for the account of each Bank, an upfront fee as set forth
in the letter agreement between the Borrower and the Administrative Agent.
3.3 Agency Fee. Borrower shall pay to the Administrative Agent an
agency fee in such amounts and at such times as heretofore agreed upon by letter
agreement between Borrower and the Administrative Agent.
3.4 Capital Adequacy.
(a) If any Bank (an "Affected Bank") determines that compliance
with any Law or regulation or with any guideline or request from any
central bank or other Governmental Agency (whether or not having the
force of Law) enacted or issued after the 2000 Closing Date relating to
the capital adequacy of banks or corporations in control of banks has or
would have the effect of reducing the rate of return on the capital of
such Affected Bank or any corporation controlling such Affected Bank as
a consequence of, or with reference to, such Affected Bank's
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Pro Rata Share of the Commitment below the rate which the Bank or such
other corporation could have achieved but for such compliance (taking
into account the policies of such Bank or corporation with regard to
capital adequacy), then Borrower shall from time to time, upon demand by
such Affected Bank in accordance with this Section 3.4 (with a copy of
such demand to the Administrative Agent), within 15 days after demand
pay to such Affected Bank additional amounts sufficient to compensate
such Affected Bank or other corporation for such reduction.
(b) An Affected Bank may not seek compensation under Section
3.4(a) unless the demand for such compensation is delivered to Borrower
within six months following the date of enactment or issuance of the
Law, regulation, guideline or request giving rise to such demand for
compensation.
(c) A certificate as to any amounts for which an Affected Bank is
seeking compensation under Section 3.4(a), submitted to Borrower and the
Administrative Agent by such Affected Bank, shall be conclusive and
binding for all purposes, absent manifest error. Each Affected Bank
shall calculate such amounts in a manner which is consistent with the
manner in which it makes calculations for comparable claims with respect
to similarly situated borrowers from such Affected Bank, will not
allocate to Borrower a proportionately greater amount of such
compensation than it allocates to each of its other commitments to lend
or other loans with respect to which it is entitled to demand comparable
compensation, and will not include amounts already factored into the
rates of interest or fees already provided for herein. Each Bank agrees
promptly to notify Borrower and the Administrative Agent of any
circumstances that would cause Borrower to pay additional amounts
pursuant to this Section, provided that the failure to give such notice
shall not affect Borrower's obligation to pay such additional amounts
hereunder.
(d) Without limiting its obligation to reimburse an Affected Bank
for compensation theretofore claimed by an Affected Bank pursuant to
Section 3.4(a), Borrower may, within 60 days following any demand by an
Affected Bank, request that one or more Persons that are Eligible
Assignees and that are acceptable to Borrower and approved by the
Administrative Agent (which approval shall not be unreasonably withheld)
purchase all (but not part) of the Affected Bank's then outstanding
Advances, its Note, and assume its Pro Rata Share of the Commitment and
its obligations hereunder. If one or more such Banks or banks so agree
in writing (each, an "Assuming Bank" and collectively, the "Assuming
Banks"), the Affected Bank shall assign its Pro Rata Share of the
Commitment, together with the Indebtedness then evidenced by its Note,
to the Assuming Bank or Assuming Banks in accordance with Section 11.8.
On the date of any such assignment, the Affected Bank which is being so
replaced shall cease to be a "Bank" for all purposes of this Agreement
and shall receive (x) from the Assuming Bank or Assuming Banks the
principal amount of its Advances then outstanding and (y) from Borrower
all interest and fees accrued and then unpaid with respect to such
Advances, together with any other amounts then payable to such Bank by
Borrower.
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3.5 LIBOR Fees and Costs.
(a) If the occurrence of any Regulatory Development after the
2000 Closing Date:
(i) shall subject any Bank or its LIBOR Lending Office to any
tax, duty or other charge or cost with respect to any LIBOR
Advance or its obligation to make LIBOR Advances, or shall change
the basis of taxation of payments to any Bank of the principal of
or interest on any LIBOR Advance or any other amounts due under
this Agreement in respect of any LIBOR Advance or its obligation
to make LIBOR Advances (except for changes in any tax on the
overall net income, gross income or gross receipts of such Bank
or its LIBOR Lending Office);
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any reserve imposed by the Board
of Governors of the Federal Reserve System), special deposit or
similar requirements (excluding any such requirement included in
any applicable Reserve Percentage) against assets of, deposits
with or for the account of, or credit extended by, any Bank or
its LIBOR Lending Office; or
(iii) shall impose on any Bank or its LIBOR Lending Office or
the LIBOR Market any other condition affecting any LIBOR Advance
or its obligation to make LIBOR Advances, or shall otherwise
affect any of the same;
and the result of any of the foregoing, as determined by such Bank,
increases the cost to such Bank or its LIBOR Lending Office of making or
maintaining any LIBOR Advance or in respect of any LIBOR Advance or its
obligation to make LIBOR Advances or reduces the amount of any sum
received or receivable by such Bank or its LIBOR Lending Office with
respect to any LIBOR Advance or its obligation to make LIBOR Advances
(assuming such Bank's LIBOR Lending Office had funded 100% of its LIBOR
Advance in the LIBOR Market), then, within 15 days after demand by such
Bank (with a copy to the Administrative Agent), Borrower shall pay to
such Bank such additional amount or amounts as will compensate such Bank
for such increased cost or reduction (determined as though such Bank's
LIBOR Lending Office had funded 100% of its LIBOR Advance in the LIBOR
Market); provided that Borrower shall not be liable to any Bank for any
such increased cost or reduction pursuant to this Section in respect of
any period which is more than six months prior to such Bank's demand for
such compensation. A statement of any Bank claiming compensation under
this subsection and setting forth the additional amount or amounts to be
paid to it hereunder shall be conclusive in the absence of manifest
error. Each Bank agrees to endeavor promptly to notify Borrower of any
event of which it has actual knowledge which will entitle such Bank to
compensation pursuant to this Section, and agrees to designate a
different LIBOR Lending Office if such designation will avoid the need
for or reduce the amount of such compensation and will not, in the
judgment of such Bank, otherwise be disadvantageous to such Bank. If any
Bank claims compensation under this Section, Borrower may at any time,
upon at least four (4) LIBOR Market Days' prior notice to the
Administrative Agent and such Bank and upon payment in full of the
amounts provided for in this Section through the date of such payment
plus any prepayment fee required by Section 3.5(d), pay in full the
affected LIBOR Advances of such Bank or request that such LIBOR Advances
be converted to Prime Rate Advances.
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(b) If after the 2000 Closing Date the occurrence of any
Regulatory Development shall, in the opinion of any Bank, make it
unlawful or impossible for such Bank or its LIBOR Lending Office to
make, maintain or fund its portion of any LIBOR Loan, or to take
deposits of, dollars in the LIBOR Market, or to determine or charge
interest rates based upon the LIBOR, and such Bank shall so notify the
Administrative Agent, then such Bank's obligation to make LIBOR Advances
shall be suspended for the duration of such illegality or impossibility
and the Administrative Agent forthwith shall give notice thereof to the
other Banks and Borrower. Before giving any notice to the Administrative
Agent pursuant to this Section, such Bank shall designate a different
Lending Office if such designation will avoid the need for giving such
notice and will not, in the judgment of such Bank, be otherwise
disadvantageous to such Bank. Upon receipt of such notice, the
outstanding principal amount of such Bank's LIBOR Advances, together
with accrued interest thereon, automatically shall be converted to Prime
Rate Advances with Interest Periods corresponding to the LIBOR Loans of
which such LIBOR Advances were a part on either (1) the last day of the
Interest Period(s) applicable to such LIBOR Advances if such Bank may
lawfully continue to maintain and fund such LIBOR Advances to such
day(s) or (2) immediately if such Bank may not lawfully continue to fund
and maintain such LIBOR Advances to such day(s), provided that in such
event the conversion shall not be subject to payment of a prepayment fee
under Section 3.5(d). In the event that any Bank is unable, for the
reasons set forth above, to make, maintain or fund its portion of any
LIBOR Loan, such Bank shall fund such amount as a Prime Rate Advance for
the same period of time, and such amount shall be treated in all
respects as a Prime Rate Advance.
(c) If, with respect to any proposed LIBOR Loan:
(i) the Administrative Agent reasonably determines that, by
reason of circumstances affecting the LIBOR Market generally that
are beyond the reasonable control of the Banks, deposits in
dollars (in the applicable amounts) are not being offered to each
of the Banks in the LIBOR Market for the applicable Interest
Period; or
(ii) the Majority Banks advise the Administrative Agent that
the LIBOR as determined by the Administrative Agent will not
adequately and fairly reflect the cost to such Banks of making
the applicable LIBOR Advances;
then the Administrative Agent forthwith shall give notice thereof to
Borrower and the Banks, whereupon until the Administrative Agent
notifies Borrower that the circumstances giving rise to such suspension
no longer exist, the obligation of the Banks to make any future LIBOR
Advances shall be suspended. If at the time of such notice there is then
pending a Request for Loan that specifies a LIBOR Loan, such Request for
Loan shall be deemed to specify a Prime Rate Loan.
(d) Upon payment or prepayment of any LIBOR Advance (other than
as the result of a conversion required under Section 3.5(b)) on a day
other than the last day in the applicable Interest Period (whether
voluntarily, involuntarily, by reason of acceleration, or otherwise), or
upon the failure of Borrower to borrow on the date or in the amount
specified for a LIBOR Loan in any Request for Loan, Borrower shall pay
to each Bank an amount equal to the sum of
(i) $250; plus
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(ii) the amount, if any, by which (x) the additional interest
that would have accrued (without any Applicable LIBOR Spread) on
the principal amount prepaid on account of the LIBOR Advance had
it remained outstanding until the last day of the applicable
Interest Period, exceeds (y) the interest that Bank could recover
by placing funds in the amount of the prepayment on deposit in
the LIBOR Market selected by that Bank for a period beginning on
the date of the prepayment and ending on the last day of the
applicable Interest Period, or for a comparable period for which
an appropriate rate quote may be obtained; plus
(iii) an amount equal to all costs and expenses which that
Bank incurred or reasonably expects to incur in liquidating and
reinvesting the prepayment.
Each Bank's determination of the amount of any prepayment fee or failure
to borrow fee payable under this Section 3.5(d) shall be conclusive in
the absence of manifest error.
(e) Any statement or certificate given by a Bank under this
Section 3.5 shall satisfy the requirements set forth in Section 3.5(c)
with respect to requests for reimbursement under Section 3.5(a).
(f) Should any Bank demand payment under the provisions of
Section 3.5(a) or should any Bank's LIBOR Advances be suspended under
the provisions of Section 3.5(b), then without limiting its obligation
to reimburse any Bank for compensation claimed by such Bank pursuant to
this Section 3.5, Borrower may, within 60 days following such
occurrence, treat that Bank as an "Affected Bank" under Section 3.4(d),
and exercise the remedies set forth in such Section 3.4(d).
3.6 Late Payments/Default Interest. If any installment of principal
or interest under the Notes or any other amount payable to the Banks under any
Loan Document is not paid when due, it shall thereafter bear interest at a
fluctuating interest rate per annum at all times equal to the sum of the Prime
Rate plus the Applicable Prime Rate Spread plus 2%, to the extent permitted by
applicable Law, until paid in full (whether before or after judgment). Upon and
during the continuance of any Event of Default, the Indebtedness evidenced by
the Notes shall, at the election of the Majority Banks and upon notice to
Borrower (and in lieu of interest provided for in the preceding sentence), bear
interest at a fluctuating interest rate per annum at all times equal to the sum
of the Prime Rate plus the Applicable Prime Rate Spread plus 2%, to the extent
permitted by applicable Law, until no Event of Default exists (whether before or
after judgment). Notwithstanding the preceding sentence, after the occurrence of
any Event of Default under Sections 6.7, 6.10 or 6.16, the Indebtedness
evidenced by the Notes may not bear interest at the increased rate provided for
in the preceding sentence until such Event of Default has continued for at least
15 days, in the case of Section 6.7, or 30 days, in the case of Sections 6.10
or 6.16.
3.7 Computation of Interest and Fees. All computations of interest
and fees hereunder shall be calculated on the basis of a year of 360 days and
paid for the actual number of days elapsed (including the first day and
excluding the last day), which results in greater interest than if a year of 365
days were used. Any Loan that is repaid on the same day on which it is made
shall bear interest for one day.
3.8 Holidays. If any principal payment to be made by Borrower on a
Prime Rate Loan shall come due on a day other than a Banking Day, payment shall
be made on the next succeeding
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Banking Day and the extension of time shall be reflected in computing interest.
If any principal payment to be made by Borrower on a LIBOR Loan shall come due
on a day other than a LIBOR Market Day, payment shall be made on the next
preceding or succeeding LIBOR Market Day as determined by the Administrative
Agent in accordance with the then current banking practice in the LIBOR Market
and the adjustment shall be reflected in computing interest.
3.9 Payment Free of Taxes.
(a) Any payments made by any Party under the Loan Documents shall
be made free and clear of, and without reduction by reason of, any tax,
assessment or other charge imposed by any Governmental Agency, central
bank or comparable authority (other than taxes on income or gross
receipts generally applicable to banks). To the extent that Borrower is
obligated by applicable Laws to make any deduction or withholding on
account of taxes, assessments or other charges imposed by any
Governmental Agency from any amount payable to any Bank under this
Agreement, Borrower shall (a) make such deduction or withholding and pay
the same to the relevant Governmental Agency and (b) pay such additional
amount to that Bank as is necessary to result in that Bank's receiving a
net after-tax (or after-assessment or after-charge) amount equal to the
amount to which that Bank would have been entitled under this Agreement
absent such deduction or withholding. If and when receipt of such
payment results in an excess payment or credit to that Bank on account
of such taxes, assessments or other charges, that Bank shall refund such
excess to Borrower. Each Bank that is incorporated under the Laws of a
jurisdiction other than the United States of America or any state
thereof shall deliver to Borrower, with a copy to the Administrative
Agent, within twenty days after the 2000 Closing Date (or such later
date on which such Bank becomes a "Bank" hereunder), a certificate
signed by a Responsible Official of that Bank to the effect that such
Bank is entitled to receive payments of interest and other amounts
payable under this Agreement without deduction or withholding on account
of United States of America federal income taxes, which certificate
shall be accompanied by two copies of Internal Revenue Service Form 1001
or Form 4224, as applicable, also executed by a Responsible Official of
that Bank. Each such Bank agrees (i) promptly to notify the
Administrative Agent and Borrower if any fact set forth in such
certificate ceases to be true and correct and (ii) to take such steps as
may be reasonably necessary to avoid any requirement of applicable Laws
that Borrower make any deduction or withholding for taxes from amounts
payable to that Bank under this Agreement.
(b) Without limiting its obligation to pay any additional amount
to a Bank pursuant to Section 3.9(a), Borrower may, within 60 days
following any such payment by that Bank, treat that Bank as an "Affected
Bank" under Section 3.4(d), and exercise the remedies set forth in such
Section 3.4(d).
3.10 Funding Sources. Nothing in this Agreement shall be deemed to
obligate any Bank to obtain the funds for its share of any Loan in any
particular place or manner or to constitute a representation by any Bank that it
has obtained or will obtain the funds for its share of any Loan in any
particular place or manner.
3.11 Failure to Charge or Making of Payment Not Subsequent Waiver.
Any decision by any Bank not to require payment of any fee or costs, or to
reduce the amount of the payment required for any fee or costs, or to calculate
any fee or any cost in any particular manner, shall not limit or be deemed a
waiver of any Bank's right to require full payment of any fee or costs, or to
calculate any fee or any costs in any other manner. Any decision by Borrower to
pay any fee or costs shall not
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limit or be deemed a waiver of any right of Borrower to protest or dispute the
payment amount of such fee or costs.
3.12 Time and Place of Payments; Evidence of Payments; Application
of Payments. The amount of each payment hereunder, under the Notes or under any
Loan Document shall be made to the Administrative Agent at the Administrative
Agent's Office, for the account of each of the Banks or the Administrative
Agent, as the case may be, in lawful money of the United States of America
without deduction, offset or counterclaim and in immediately available funds on
the day of payment (which must be a Banking Day). All payments of principal
received after 10:00 a.m., California time, on any Banking Day, shall be deemed
received on the next succeeding Banking Day for purposes of calculating interest
thereon. The amount of all payments received by the Administrative Agent for the
account of a Bank shall be promptly paid by the Administrative Agent to that
Bank in immediately available funds. Each Bank shall keep a record of Advances
made by it and payments of principal with respect to each Note, and such record
shall be presumptive evidence of the principal amount owing under such Note;
provided that failure to keep such record shall in no way affect the Obligations
of Borrower hereunder. Prior to the Maturity Date or an acceleration of the
maturity of the Loans, payments under the Loan Documents shall be applied first
to amounts owing thereunder other than the outstanding principal balance under
the Notes and second to the outstanding principal balance under the Notes in a
manner designated by Borrower or, if no such designation is made prior to
payment or, if an Event of Default shall have occurred and be continuing, as may
be designated by the Majority Banks. Following the Maturity Date or an
acceleration of the maturity of the Loans, payments and recoveries under the
Loan Documents shall be applied in a manner designated in Section 9.2(d).
3.13 Administrative Agent's Right to Assume Payments Will be Made.
Unless the Administrative Agent shall have been notified by Borrower prior to
the date on which any payment to be made by Borrower hereunder is due that
Borrower does not intend to remit such payment, the Administrative Agent may, in
its discretion (but shall not be so obligated), assume that Borrower has
remitted such payment when so due and the Administrative Agent may, in its
discretion and in reliance upon such assumption, make available to each Bank on
such payment date an amount equal to such Bank's Pro Rata Share of such assumed
payment. If Borrower has not in fact remitted such payment to the Administrative
Agent, each Bank shall forthwith on demand repay to the Administrative Agent the
amount of such assumed payment made available to such Bank, together with
interest thereon in respect of each day from and including the date such amount
was made available by the Administrative Agent to such Bank to but excluding the
date such amount is repaid to the Administrative Agent at a rate per annum equal
to the actual cost to the Administrative Agent of funding such amount as
notified by the Administrative Agent to such Bank.
3.14 Survivability. All of Borrower's obligations under this
Article 3 shall survive for 3 months following the date on which all Loans
hereunder are fully paid.
3.15 Bank Calculation Certificate. Any request for compensation
pursuant to Section 3.4 or 3.5 shall be accompanied by a statement of an officer
of the Bank requesting such compensation and describing the methodology used by
such Bank in calculating the amount of such compensation, which methodology (i)
may consist of any reasonable averaging and attribution methods and (ii) in the
case of Section 3.4 hereof shall be consistent with the methodology used by such
Bank in making similar calculations in respect of loans or commitments to other
borrowers.
3.16 Transition. Borrower warrants and covenants that as of the
2000 Closing Date there will be no loans of any nature outstanding under the
Prior Loan Agreements. The parties hereto
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agree that as of the 2000 Closing Date all commitments to extend credit under
the Prior Loan Agreements shall terminate.
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Article 4
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to the Banks that:
4.1 Existence and Qualification; Power; Compliance with Law.
Borrower is a corporation duly organized, validly existing and in good standing
under the Laws of Delaware, and its certificate of incorporation does not
provide for the termination of its existence. Borrower is duly qualified or
registered to transact business as a foreign corporation in the State of
California, and in each other jurisdiction in which the conduct of its business
or the ownership of its properties makes such qualification or registration
necessary, except where the failure so to qualify or register would not
constitute a Material Adverse Effect. Borrower has all requisite corporate power
and authority to conduct its business, to own and lease its Properties and to
execute, deliver and perform all of its obligations under the Loan Documents.
All outstanding shares of capital stock of Borrower are duly authorized, validly
issued, fully paid, non-assessable, and were issued in compliance with all
applicable state and federal securities Laws, except where the failure to so
comply would not constitute a Material Adverse Effect. Borrower is in
substantial compliance with all Laws and other legal requirements applicable to
its business, has obtained all authorizations, consents, approvals, orders,
licenses and permits (collectively, "Authorizations") from, and has accomplished
all filings, registrations and qualifications with, or obtained exemptions from
any of the foregoing from, any Governmental Agency that are necessary for the
transaction of its business, except where the failure so to obtain
Authorizations, comply, file, register, qualify or obtain exemptions does not
constitute a Material Adverse Effect.
4.2 Authority; Compliance with Other Instruments and Government
Regulations. The execution, delivery, and performance by Borrower, and by each
Guarantor Subsidiary of Borrower, of the Loan Documents to which it is a Party,
have been duly authorized by all necessary corporate action, and do not:
(a) require any consent or approval not heretofore obtained of
any stockholder, partner, security holder, or creditor of such Party;
(b) violate or conflict with any provision of such Party's
charter, certificate or articles of incorporation, bylaws, certificate
or articles of organization, operating agreement, partnership agreement
or other organizational or governing documents of such Party;
(c) result in or require the creation or imposition of any Lien
or Right of Others upon or with respect to any Property now owned or
leased or hereafter acquired by such Party;
(d) constitute a "transfer of an interest" or an "obligation
incurred" that is avoidable by a trustee under Section 548 of the
Bankruptcy Code of 1978, as amended, or constitute a "fraudulent
transfer" or "fraudulent obligation" within the meaning of the Uniform
Fraudulent Transfer Act as enacted in any jurisdiction or any analogous
Law;
(e) violate any Requirement of Law applicable to such Party; or
(f) result in a breach of or constitute a default under, or cause
or permit the acceleration of any obligation owed under, any indenture
or loan or credit agreement or any other Contractual Obligation to which
such Party or any of its Property is bound or affected;
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and neither Borrower nor any Subsidiary of Borrower is in violation of,
or default under, any Requirement of Law or Contractual Obligation, or
any indenture, loan or credit agreement described in Section 4.2(f) in
any respect that would constitute a Material Adverse Effect.
4.3 No Governmental Approvals Required. Except such as have
heretofore been obtained, no authorization, consent, approval, order, license or
permit from, or filing, registration, or qualification with, or exemption from
any of the foregoing from, any Governmental Agency is or will be required to
authorize or permit the execution, delivery and performance by Borrower or any
Significant Subsidiary of Borrower of the Loan Documents to which it is a Party.
4.4 Subsidiaries.
(a) Schedule 4.4 correctly sets forth the names, the form of
legal entity and jurisdictions of organization of all Subsidiaries of
Borrower as of the 2000 Closing Date and identifies each such Subsidiary
that is a Consolidated Subsidiary, a Significant Subsidiary, a Guarantor
Subsidiary, a Foreign Subsidiary and a Financial Subsidiary. As of the
2000 Closing Date, unless otherwise indicated in Schedule 4.4, all of
the outstanding shares of capital stock, or all of the units of equity
interest, as the case may be, of each Subsidiary indicated thereon are
owned of record and beneficially by Borrower or one of such
Subsidiaries, and all such shares or equity interests so owned were
issued in compliance with all state and federal securities Laws and are
duly authorized, validly issued, fully paid and non-assessable (other
than with respect to required capital contributions to any joint venture
in accordance with customary terms and provisions of the related joint
venture agreement), except where the failure to so comply would not
constitute a Material Adverse Effect, and are free and clear of all
Liens and Rights of Others, except for Permitted Encumbrances and
Permitted Rights of Others.
(b) Each Significant Subsidiary is as of the date of this
Agreement, and will be as of the 2000 Closing Date, a legal entity of
the form described for that Subsidiary in Schedule 4.4, and is duly
organized, validly existing and in good standing under the Laws of its
jurisdiction of organization, is duly qualified to do business as a
foreign organization and is in good standing as such in each
jurisdiction in which the conduct of its business or the ownership or
leasing of its Properties makes such qualification necessary (except
where the failure to be so duly qualified and in good standing does not
constitute a Material Adverse Effect) and has all requisite power and
authority to conduct its business, to own and lease its Properties and
to execute, deliver and perform the Loan Documents to which it is a
Party.
(c) Each Significant Subsidiary is in substantial compliance with
all Laws and other requirements applicable to its business and has
obtained all Authorizations from, and each such Significant Subsidiary
has accomplished all filings, registrations, and qualifications with, or
obtained exemptions from any of the foregoing from, any Governmental
Agency that are necessary for the transaction of its business, except
where the failure so to obtain Authorizations, comply, file, register,
qualify or obtain exemptions does not constitute a Material Adverse
Effect.
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4.5 Financial Statements. Borrower has furnished to each Bank the
following financial statements:
(a) the audited consolidated financial statements of Borrower and
its Consolidated Subsidiaries as at November 30, 1999 and for the Fiscal
Year then ended; and
(b) the unaudited consolidating financial statements of Borrower
and its Consolidated Subsidiaries as at May 31, 2000 for the Fiscal
Quarter then ended and for the portion of the Fiscal Year ended with
such Fiscal Quarter.
The audited financial statements described in clause (a) are in accordance with
the books and records of Borrower and its Consolidated Subsidiaries, were
prepared in accordance with Generally Accepted Accounting Principles and fairly
present in accordance with Generally Accepted Accounting Principles consistently
applied the consolidated financial condition and results of operations of
Borrower and its Consolidated Subsidiaries as at the date and for the period
covered thereby. The unaudited financial statements described in clause (b), are
in accordance with the books and records of Borrower and its Consolidated
Subsidiaries, were prepared in accordance with Generally Accepted Accounting
Principles and fairly present in accordance with Generally Accepted Accounting
Principles consistently applied the consolidating financial condition and
results of operation of Borrower and its Consolidated Subsidiaries as at the
date and for the period covered thereby.
4.6 No Other Liabilities; No Material Adverse Effect. Borrower and
its Consolidated Subsidiaries do not have any material liability or material
contingent liability not reflected or disclosed in the financial statements or
in the notes to the financial statements described in Section 4.5, other than
liabilities and contingent liabilities arising in the ordinary course of
business subsequent to November 30, 1999. Since November 30, 1999, no event or
circumstance has occurred that constitutes a Material Adverse Effect with
respect to Borrower and its Subsidiaries.
4.7 Title to Assets. As of the 2000 Closing Date, Borrower and its
Consolidated Subsidiaries have good and valid title to all of the assets
reflected in the financial statements described in Section 4.5 owned by them or
any of them (other than assets disposed of in the ordinary course of business)
and all other assets owned on the date of this Agreement, free and clear of all
Liens and Rights of Others other than (a) those reflected or disclosed in the
notes to the financial statements described in Section 4.5, (b) immaterial Liens
or Rights of Others not required under Generally Accepted Accounting Principles
to be so reflected or disclosed, (c) Liens permitted pursuant to Section 6.7,
(d) Permitted Rights of Others, and (e) such existing Liens or Rights of Others
as are described on Schedule 4.7 hereto.
4.8 Intangible Assets. Borrower and its Subsidiaries own, or
possess the unrestricted right to use, all trademarks, trade names, copyrights,
patents, patent rights, licenses and other intangible assets that are necessary
in the conduct of their businesses as operated, and no such intangible asset, to
the best knowledge of Borrower, conflicts with the valid trademark, trade name,
copyright, patent, patent right or intangible asset of any other Person to the
extent that such conflict would constitute a Material Adverse Effect.
4.9 Existing Indebtedness and Contingent Guaranty Obligations. As
of the 2000 Closing Date, except as set forth in Schedule 4.9, neither Borrower
nor any of its Subsidiaries has (a) any Indebtedness owed to any Person or (b)
outstanding any Contingent Guaranty Obligation with respect to obligations of
another Person that is not a Subsidiary of Borrower.
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4.10 Governmental Regulation. Neither Borrower nor any of its
Subsidiaries is subject to regulation under the Public Utility Holding Company
Act of 1935, the Federal Power Act, the Interstate Commerce Act or the
Investment Company Act of 1940.
4.11 Litigation. There are no actions, suits, or proceedings pending
or, to the best knowledge of Borrower, threatened against or affecting Borrower
or any of its Subsidiaries or any Property of any of them before any
Governmental Agency which would constitute a Material Adverse Effect.
4.12 Binding Obligations. Each of the Loan Documents to which
Borrower or any Guarantor Subsidiary of Borrower is a Party will, when executed
and delivered by Borrower or the Guarantor Subsidiary, as the case may be,
constitute the legal, valid and binding obligation of Borrower or the Guarantor
Subsidiary, as the case may be, enforceable against Borrower or the Guarantor
Subsidiary, as the case may be, in accordance with its terms, except as
enforcement may be limited by Debtor Relief Laws or by equitable principles
relating to the granting of specific performance and other equitable remedies as
a matter of judicial discretion.
4.13 No Default. No event has occurred and is continuing that is a
Default or an Event of Default.
4.14 Pension Plans. As of the 2000 Closing Date, all contributions
required to be made under any Pension Plan maintained by Borrower or any of its
ERISA Affiliates (or to which Borrower or any ERISA Affiliate contributes or is
required to contribute) have been made or accrued in the balance sheet of
Borrower and its Consolidated Subsidiaries as at November 30, 1999. There is no
"accumulated funding deficiency" within the meaning of Section 302 of ERISA or
any liability to the PBGC (other than for premiums) with respect to any such
Pension Plan other than a Multiemployer Plan.
4.15 Tax Liability. Borrower and its Subsidiaries have filed all tax
returns which are required to be filed, and have paid, or made provision for the
payment of, all taxes which have become due pursuant to said returns or pursuant
to any assessment received by Borrower or any Subsidiary, except (a) such taxes,
if any, as are being contested in good faith by appropriate proceedings (and
with respect to which Borrower or its Subsidiary has established adequate
reserves for the payment of the same), and (b) such taxes the failure of which
to pay will not constitute a Material Adverse Effect.
4.16 Regulation U. Neither Borrower nor any of its Subsidiaries is
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 meanings of Regulation U of the Board of Governors of the
Federal Reserve System, and no Loan hereunder will be used to purchase or carry
any such margin stock in violation of Regulation U.
4.17 Environmental Matters. To the best knowledge of Borrower,
Borrower and its Subsidiaries are in substantial compliance with all applicable
Laws relating to environmental protection where the failure to comply would
constitute a Material Adverse Effect. To Borrower's best knowledge, neither
Borrower nor any of its Subsidiaries has received any notice from any
Governmental Agency respecting the alleged violation by Borrower or any
Subsidiary of such Laws which would constitute a Material Adverse Effect and
which has not been or is not being corrected.
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4.18 Disclosure. The information provided by Borrower to the Banks
in connection with this Agreement or any Loan, taken as a whole, has not
contained any untrue statement of a material fact and has not omitted a material
fact necessary to make the statements contained therein, taken as a whole, not
misleading under the totality of the circumstances existing at the date such
information was provided and in the context in which it was provided.
4.19 Projections. Except with respect to the effect of the Xxxxx
Homes Stock Repurchase, which is not reflected in the Projections, as of the
2000 Closing Date, the assumptions upon which the Projections are based are
reasonable and consistent with each other assumption and with all facts known to
Borrower and that the Projections are reasonably based on those assumptions.
Nothing in this Section 4.19 shall be construed as a representation or warranty
as of any date other than the 2000 Closing Date or that the Projections will in
fact be achieved by Borrower.
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Article 5
AFFIRMATIVE COVENANTS
(OTHER THAN INFORMATION AND
REPORTING REQUIREMENTS)
As long as any Loan remains unpaid, or any other Obligation remains
unpaid, or any portion of the Commitment remains outstanding, Borrower shall,
and shall cause each of its Subsidiaries to, unless the Administrative Agent
(with the approval of the Majority Banks) otherwise consents in writing:
5.1 Payment of Taxes and Other Potential Liens. Pay and discharge
promptly, all taxes, assessments, and governmental charges or levies imposed
upon Borrower or any of its Subsidiaries, upon their respective Property or any
part thereof, upon their respective income or profits or any part thereof,
except any tax, assessment, charge, or levy that is not yet past due, or is
being contested in good faith by appropriate proceedings, as long as Borrower or
its Subsidiary has established and maintains adequate reserves for the payment
of the same and by reason of such nonpayment no material Property of Borrower or
its Subsidiaries is subject to a risk of loss or forfeiture.
5.2 Preservation of Existence. Preserve and maintain their
respective existence, licenses, rights, franchises, and privileges in the
jurisdiction of their formation and all authorizations, consents, approvals,
orders, licenses, permits, or exemptions from, or registrations with, any
Governmental Agency that are necessary for the transaction of their respective
business, and qualify and remain qualified to transact business in each
jurisdiction in which such qualification is necessary in view of their
respective business or the ownership or leasing of their respective Properties;
provided that (a) the failure to preserve and maintain any particular right,
franchise, privilege, authorization, consent, approval, order, license, permit,
exemption, or registration, or to qualify or remain qualified in any
jurisdiction, that does not constitute a Material Adverse Effect will not
constitute a violation of this covenant, and (b) nothing in this Section 5.2
shall prevent any consolidation or merger or disposition of assets permitted by
Section 6.3 or shall prevent the termination of the business or existence
(corporate or otherwise) of any Subsidiary of Borrower which in the reasonable
judgment of the management of Borrower is no longer necessary or desirable.
5.3 Maintenance of Properties. Maintain, preserve and protect all
of their respective real Properties in good order and condition, subject to wear
and tear in the ordinary course of business and damage caused by the natural
elements, and not permit any waste of their respective real Properties, except
that the failure to so maintain, preserve or protect any particular real
Property, or the permitting of waste on any particular real Property, where such
failure or waste with respect to all real Properties of Borrower and its
Subsidiaries, in the aggregate, would not constitute a Material Adverse Effect
will not constitute a violation of this covenant.
5.4 Maintenance of Insurance. Maintain insurance with responsible
insurance companies in such amounts and against such risks as in Borrower's
reasonable business judgment is adequate in light of Borrower's and its
Subsidiaries' size, business, assets and location of operations.
5.5 Compliance with Laws. Comply with all Requirements of Laws
noncompliance with which would constitute a Material Adverse Effect, except that
Borrower and its Subsidiaries need not comply with a Requirement of Law then
being contested by any of them in good faith by appropriate procedures, so long
as such contest (or a bond or surety posted in connection
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therewith) operates as a stay of enforcement of any penalty that would otherwise
apply as a result of such failure to comply.
5.6 Inspection Rights. At any time during regular business hours
and as often as reasonably requested (and, in any event, upon 24 hours' prior
notice), permit any Bank or any appropriately designated employee, agent or
representative thereof at the expense of such Bank to examine, audit and make
copies and abstracts from the records and books of account of, and to visit and
inspect the Properties of Borrower and its Subsidiaries, and to discuss the
affairs, finances and accounts of Borrower and its Subsidiaries with any of
their officers or employees; provided that none of the foregoing unreasonably
interferes with the normal business operations of Borrower or any of its
Subsidiaries and that the Banks shall engage in any such inspections on a
cooperative basis, if there has been no Default or Event of Default.
5.7 Keeping of Records and Books of Account. Keep adequate records
and books of account fairly reflecting all financial transactions in conformity
with Generally Accepted Accounting Principles applied on a consistent basis
(except for changes concurred with by Borrower's independent certified public
accountants) and all applicable requirements of any Governmental Agency having
jurisdiction over Borrower or any of its Subsidiaries.
5.8 Use of Proceeds. Use the proceeds of all Loans solely for
working capital, Acquisitions permitted hereunder and other general corporate
purposes of Borrower and its Subsidiaries.
5.9 Subsidiary Guaranty. Cause each of its Guarantor Subsidiaries
hereafter formed, acquired or qualifying as a Guarantor Subsidiary, to execute
and deliver a joinder of the Subsidiary Guaranty promptly following such
formation, acquisition or qualification.
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Article 6
NEGATIVE COVENANTS
As long as any Loan remains unpaid, or any other Obligation remains
unpaid, or any portion of the Commitment remains outstanding, Borrower shall
not, and shall not permit any of its Subsidiaries to, unless the Administrative
Agent (with the approval of the Majority Banks) otherwise consents in writing:
6.1 Payment or Prepayment of Subordinated Obligations. Make an
optional or unscheduled payment or prepayment of any principal (including an
optional or unscheduled sinking fund payment), interest or any other amount with
respect to any Subordinated Obligation, or make a purchase or redemption of any
Subordinated Obligation, or make any payment with respect to any Subordinated
Obligation in violation of the subordination provisions in the instruments
governing such Subordinated Obligation if a Default or Event of Default then
exists or would result therefrom. Notwithstanding the preceding sentence, if no
Default or Event of Default then exists or would result therefrom, Borrower may
refinance the entire outstanding amount of a Subordinated Obligation, provided
the new obligation constitutes a Subordinated Obligation with a maturity date no
earlier than and an interest rate no higher than those of the Subordinated
Obligation being refinanced.
6.2 [Intentionally Omitted]
6.3 Mergers and Sale of Assets. Merge or consolidate with or into
any Person, or sell a Material Amount of Assets to any Person, except, subject
to Section 6.6;
(a) a merger of Borrower into a wholly-owned Subsidiary of
Borrower that has nominal assets and liabilities, the primary purpose of
which is to effect the reincorporation of Borrower in another state;
(b) mergers or consolidations of a Subsidiary of Borrower into
Borrower (with Borrower as the surviving corporation) or into any other
Subsidiary of Borrower, provided that (i) the reduction in the
proportionate share of Borrower and its Subsidiaries in the total assets
of such resulting Subsidiary (after intercompany eliminations) does not
constitute a Material Amount of Assets and (ii) immediately after giving
effect to such transaction, no Default or Event of Default shall have
occurred and be continuing;
(c) mergers, consolidations, liquidations, or sales of all or
substantially all of the assets of a Subsidiary; provided that (i) any
such transaction does not involve a transfer by Borrower or its
Subsidiaries of a Material Amount of Assets and (ii) immediately after
giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing; or
(d) a merger or consolidation of Borrower with another Person if
(i) no Change of Control results therefrom, (ii) Borrower does not
transfer a Material Amount of Assets to one or more Persons in
connection with the merger or consolidation and (iii) immediately after
giving effect to such merger, no Default or Event of Default shall have
occurred and be continuing.
6.4 Investments and Acquisitions. Make any Acquisition, or enter
into an agreement to make any Acquisition, or make or suffer to exist any
Investment, other than:
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(a) Investments consisting of Cash or Cash Equivalents;
(b) advances to officers, directors and employees of Borrower or
its Subsidiaries for travel, entertainment, housing expenses,
relocation, stock option plans, or otherwise in connection with their
employment or the business of Borrower or any of its Subsidiaries;
(c) Investments of Borrower in any of its wholly-owned
Subsidiaries and Investments of any Subsidiary of Borrower in Borrower
or any of Borrower's wholly-owned Subsidiaries;
(d) Acquisitions of or Investments in Persons engaged in the same
businesses as Borrower and its Subsidiaries, or in a business reasonably
related to such businesses, including electronic commerce and similar
activities related to real estate;
(e) Acquisitions and Investments by the Mortgage Company
permitted under the Mortgage Warehousing Agreements;
(f) Acquisitions of or Investments in Persons engaged primarily
in businesses in addition to those permitted by Sections 6.4(d),
provided that the aggregate cost of all such Acquisitions and
Investments made in any fiscal year does not exceed $25,000,000;
(g) Investments in a Trust Issuer and Investments by a Trust
Issuer in Borrower;
(h) Investments in Subsidiaries in existence on the 2000 Closing
Date or as otherwise disclosed on Schedule 6.4;
(i) Investments received in connection with the settlement of a
bona fide dispute with another Person;
(j) Investments consisting of readily marketable securities
actively traded on a public exchange, provided that the aggregate amount
of any such Investments at any one time do not exceed $25,000,000; and
(k) Investments consisting of the extension of credit to
suppliers in the ordinary course of business and any Investments
received in satisfaction or partial satisfaction thereof, provided that
the aggregate amount of any such Investments at any one time do not
exceed $25,000,000;
but in all events, subject to the restrictions of Section 6.16.
6.5 ERISA Compliance. Permit any Pension Plan maintained by Borrower
or any of its ERISA Affiliates (or to which Borrower or any ERISA Affiliate
contributes or is required to contribute), other than a Multiemployer Plan, to
incur any material "accumulated funding deficiency," as such term is defined in
Section 302 of ERISA, unless waived, or permit any Pension Plan maintained by
any of them to suffer a Termination Event or incur withdrawal liability under
any Multiemployer Plan if any of such events would result in a liability of
Borrower or any ERISA affiliate exceeding in the aggregate $25,000,000.
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6.6 Change in Business. Engage in any business other than the
businesses as now conducted by Borrower or its Subsidiaries, and any business
the Board of Directors of Borrower determine in good faith is reasonably related
to such businesses, other than:
(a) businesses in which Borrower and its Subsidiaries have
invested no more than $25,000,000 in any Fiscal Year; and
(b) as permitted pursuant to Section 6.4(f).
6.7 Liens and Negative Pledges. Create, incur, assume, or suffer to
exist, any Lien of any nature upon or with respect to any of their respective
Properties, whether now owned or hereafter acquired, or enter or suffer to exist
any Contractual Obligation wherein Borrower or any of its Subsidiaries agrees
not to grant any Lien on any of their Properties, except:
(a) Liens and Contractual Obligations existing on the date hereof
and described in Schedule 4.7, provided that the obligations secured by
such Liens are not increased and that no such Lien extends to any
Property of Borrower or any Subsidiary other than the Property subject
to such Lien on the 2000 Closing Date;
(b) Liens on Property of any Financial Subsidiary or Foreign
Subsidiary securing Indebtedness of that Financial Subsidiary or Foreign
Subsidiary;
(c) Liens on Property securing Indebtedness of Borrower or any of
its Subsidiaries provided that (i) aggregate Indebtedness secured by all
such Liens shall at no time exceed $100,000,000 and (ii) the aggregate
book value of the Property so encumbered shall at no time exceed 3 times
the aggregate amount of Indebtedness so secured;
(d) Liens that may exist from time to time under the Loan
Documents;
(e) Liens consisting of a Capital Lease covering personal
Property;
(f) Permitted Encumbrances;
(g) attachment, judgment and other similar Liens arising in
connection with court proceedings; provided that the execution or
enforcement of such Lien is effectively stayed and the claims secured
thereby do not in the aggregate exceed $25,000,000 and are being
contested in good faith by appropriate proceedings timely commenced and
diligently prosecuted;
(h) Liens existing on any asset of any Person at the time such
Person becomes a Subsidiary and not created in contemplation of such
event;
(i) Liens on any asset of any Person existing at the time such
Person is merged or consolidated with or into Borrower or any of its
Subsidiaries and not created in contemplation of such event;
(j) Liens existing on any asset prior to the acquisition thereof
by Borrower or any of its Subsidiaries and not created in contemplation
of such acquisition;
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(k) Liens arising out of the refinancing, extension, renewal or
refunding of any Indebtedness secured by any Lien permitted by any of
the foregoing clauses of this Section, provided that such Indebtedness
is not increased and is not secured by additional assets;
(l) Liens arising in the ordinary course of business which (i) do
not secure Indebtedness, (ii) do not secure any obligation in an amount
exceeding $500,000 individually, or $2,000,000 in the aggregate, and
(iii) do not in the aggregate materially detract from the value of the
assets covered by such Liens or materially impair the use thereof in the
operation of Borrower's business;
(m) Liens not otherwise permitted by the foregoing clauses of
this Section which secure Indebtedness not exceeding $2,000,000 in the
aggregate;
(n) Liens referred to in the last sentence of the definition of
"Bond Facility" encumbering (i) real property owned by Borrower or one
of its Subsidiaries on November 30, 1999 or (ii) other real property of
Borrower or one of its Subsidiaries provided that the aggregate
obligations secured by such Liens does not at any time exceed
$25,000,000 plus the amount by which aggregate Indebtedness then secured
by Liens described in Section 6.7(c) is less than $100,000,000;
(o) a Contractual Obligation wherein Borrower or any of its
Subsidiaries agrees not to a grant any Lien on any of their Properties,
if such Contractual Obligation does not, by its terms, prohibit the
grant of a Lien in favor of the Administrative Agent and the Banks with
respect to the Obligations (and Borrower shall, as soon as reasonably
possible, provide to the Banks a copy of such Contractual Obligation);
and
(p) Liens on Property of a Joint Venture.
6.8 Transactions with Affiliates. Enter into any transaction of any
kind with any Affiliate of Borrower other than (a) a transaction that results in
Subordinated Obligations, (b) a transaction between or among Borrower and its
wholly-owned Subsidiaries, (c) a transaction that has been authorized by the
board of directors of Borrower with the favorable vote of a majority of the
directors who have no financial or other interest in the transaction or by the
vote of a majority of the outstanding shares of capital stock of Borrower, (d) a
transaction entered into on terms and under conditions not less favorable to
Borrower or any of its Subsidiaries than could be obtained from a Person that is
not an Affiliate of Borrower, (e) salary, bonus, employee stock options and
other compensation arrangements and indemnification arrangements with directors
or officers, (f) transactions permitted by Sections 6.4 or 6.16, or (g) the
Xxxxx Homes Stock Repurchase.
6.9 Consolidated Tangible Net Worth. Permit Consolidated Tangible
Net Worth to be, at the end of any Fiscal Quarter, less than an amount equal to
(a) $575,000,000, plus (b) an amount equal to 50% of aggregate of Consolidated
Net Income for each Fiscal Quarter contained in the fiscal period commencing on
June 1, 2000 and ending as of the last day of such Fiscal Quarter (provided that
there shall be no reduction hereunder in the event of a consolidated net loss in
any such Fiscal Quarter), plus (c) an amount equal to 50% of the cumulative net
proceeds received by Borrower from the issuance of its capital stock subsequent
to the 2000 Closing Date, plus (d) an amount equal to 50% of the cumulative net
proceeds received by Borrower from the issuance of the Trust Preferred Capital
Securities subsequent to the 2000 Closing Date, minus (e) the cumulative cost to
Borrower for the repurchase, if any, of its capital stock (provided that such
deduction shall have an aggregate cap of
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$70,000,000 for the measurement at the end of the Fiscal Quarter ending on
August 31, 2000, a cumulative aggregate $50,000,000 cap for the measurements at
the end of the Fiscal Quarters ending on November 30, 2000 and February 28,
2001, and an aggregate $20,000,000 cap for the measurement at the end of any
Fiscal Quarter thereafter).
6.10 Consolidated Leverage Ratio. Permit the Consolidated Leverage
Ratio to be, at the end of any Fiscal Quarter, greater than 2.25 to 1.00;
provided that:
(a) in the event that $30,000,000 or more is used to finance an
Acquisition by Borrower or its Subsidiaries, the foregoing maximum
permitted ratio may, upon the request of Borrower to the Administrative
Agent, be increased to 2.65 to 1.00 for up to 3 consecutive Fiscal
Quarters next ending after such Acquisition is consummated, provided
that: (i) an increase under this clause (a) has not been in effect with
respect to any of the 4 Fiscal Quarters prior to the first Fiscal
Quarter for which an adjustment is to be made; (ii) Borrower's request
is accompanied by 12-month cash flow, balance sheet and income statement
projections, reasonably acceptable to the Administrative Agent and for
delivery to the Banks, demonstrating that, giving effect to the
Acquisition and to Borrower's election under this Section, Borrower will
be in compliance with Sections 6.9, 6.10 and 6.11 for at least the next
ending 4 Fiscal Quarters; (iii) Borrower must remain in compliance with
Section 6.11 (without giving effect to any adjustment permitted
thereunder) during each Fiscal Quarter for which an adjustment is
applicable under this Section 6.10(a); and (iv) Borrower must elect on
or before 60 days after the end of the first, second and third of such
Fiscal Quarters next ending after the consummation of an Acquisition
whether the 2.65 to 1.00 maximum Consolidated Leverage Ratio is to be in
effect for the Pricing Period related to that Fiscal Quarter, it being
understood and agreed that (a) the Borrower may only make such an
election for the second and third of such Fiscal Quarters if Borrower
made a similar election for the prior Fiscal Quarter and (b) if Borrower
makes such an election, Applicable Pricing Level V shall be in effect
for the entire Pricing Period regardless of the actual Consolidated
Leverage Ratio.
(b) if an election under Section 6.10(a) is not then in effect,
the foregoing ratio shall, if needed, be increased to 2.50 to 1.00 for a
period of up to 2 consecutive Fiscal Quarters, provided that: (i) this
clause (b) has not been in effect with respect to any of the 4 Fiscal
Quarters prior to the first Fiscal Quarter for which an adjustment is
needed; (ii) no other Default or Event of Default then exists; (iii)
Borrower furnishes to the Administrative Agent no later than 60 days
after the end of the first Fiscal Quarter for which such adjustment is
needed, 12-month cash flow, balance sheet and income statement
projections, reasonably acceptable to the Administrative Agent and for
delivery to the Banks, demonstrating that Borrower will be in compliance
with Sections 6.9, 6.10 and 6.11 for at least the next ending 2 Fiscal
Quarters; (iv) as of the end of each Fiscal Quarter for which such
adjustment is applicable, the Consolidated Interest Coverage Ratio is
not less than 2.50 to 1.00; and (v) Borrower has not incurred Operating
Losses for the first Fiscal Quarter for which such adjustment is needed
and the immediately preceding Fiscal Quarter; and
(c) notwithstanding Section 6.10(a) or 6.10(b), the foregoing
ratio shall automatically be reduced to 1.75 to 1.00 as of the end of
any Fiscal Quarter if Borrower has incurred an Operating Loss for that
Fiscal Quarter and the immediately preceding Fiscal Quarter and shall
remain at 1.75 to 1.00 until the first Fiscal Quarter thereafter for
which there is no Operating Loss.
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6.11 Consolidated Interest Coverage Ratio. Permit the Consolidated
Interest Coverage Ratio to be, at the end of any Fiscal Quarter, less than 2.25
to 1.00; provided that the foregoing ratio shall, upon the request of Borrower
to the Administrative Agent, be decreased for a period of 2 Fiscal Quarters
provided that (a) an adjustment under this Section 6.11 has not been in effect
with respect to any of the 4 Fiscal Quarters prior to the first Fiscal Quarter
for which an adjustment is to be made, (b) no Default or Event of Default then
exists and (c) Borrower furnishes to the Administrative Agent 12-month cash
flow, balance sheet and income statement projections, reasonably acceptable to
the Administrative Agent, demonstrating that Borrower will be in compliance with
Sections 6.9, 6.10 and 6.11 for at least the next ending 4 Fiscal Quarters.
Subject to satisfaction of the foregoing conditions, the decrease in the ratio
for the first Fiscal Quarter shall be to 1.75 to 1.00 and the decrease for the
second Fiscal Quarter shall be to a level (in no event higher than 2.25:1.00)
that is 0.25 higher than the actual Consolidated Interest Coverage Ratio for
such first Fiscal Quarter (e.g., from 1.80 to 1.00 improving to at least 2.05 to
1.00).
6.12 Distributions. Make any Distribution (other than a Distribution
made to Borrower or to a Guarantor Subsidiary) if an Event of Default then
exists or if an Event of Default or Default would result therefrom.
6.13 Amendments. Amend, waive or terminate any provision in any
instrument or agreement governing Subordinated Obligations unless such
amendment, waiver or termination would not be materially adverse to the
interests of the Banks under this Agreement.
6.14 Hostile Tender Offers. Make any offer to the shareholders of a
publicly held corporation or business entity to purchase or acquire, or
consummate such a purchase or acquisition of, more than 5% of the shares of
capital stock or analogous ownership interests in such a corporation or business
entity if the board of directors or analogous body of such corporation or
business entity has notified Borrower that it opposes such offer or purchase,
except for consideration which consists solely of shares of capital stock or
other equity securities of Borrower or any of its Subsidiaries.
6.15 Inventory. Permit, as of the end of any Fiscal Quarter, the
book value of Domestic Unimproved Land to exceed an amount equal to 100% of
Consolidated Tangible Net Worth.
6.16 Investment in Subsidiaries and Joint Ventures. Permit, as of
the last day of any Fiscal Quarter, Borrower's equity interest, computed in
accordance with Generally Accepted Accounting Principles, in all Subsidiaries of
Borrower (other than Guarantor Subsidiaries), Financial Subsidiaries, Foreign
Subsidiaries, all Joint Ventures and all other entities with financial
statements not consolidated with those of Borrower under with Generally Accepted
Accounting Principles to exceed: (a) 35% of Consolidated Tangible Net Worth for
the Fiscal Quarter ending on November 30, 2000; (b) 25% of Consolidated Tangible
Net Worth for Fiscal Quarters ending after November 30, 2000 but on or before
November 30, 2002; and (c) 20% of Consolidated Tangible Net Worth for Fiscal
Quarters ending after November 30, 2002.
6.17 Money Market Indebtedness. So long as any Advance (as defined
in the 2000 Revolving Loan Agreement) remains unpaid or any other Obligation (as
defined in the 2000 Revolving Loan Agreement) remains unpaid, or any portion of
the Commitment (as defined in the 2000 Revolving Loan Agreement) remains in
force, permit, for any consecutive period of more than one (1) Banking Day, at
any time the sum of the aggregate outstanding principal amount of the Loans (as
such term is defined in the Revolving Loan Agreement) plus the Letter of Credit
Usage (as such term is defined in the Revolving Loan Agreement) plus the Money
Market Outstandings (as such term is defined in the
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Revolving Loan Agreement) plus the Swing Line Outstandings (as such term is
defined in the Revolving Loan Agreement) to exceed the Commitment (as such term
is defined in the 2000 Revolving Loan Agreement).
6.18 Domestic Standing Inventory. Permit, as of the last day of any
Fiscal Quarter that immediately follows a Fiscal Quarter on the last day of
which the Consolidated Leverage Ratio was in excess of 2.25:1.00, Domestic
Standing Inventory to exceed an amount equal to 15% of Net Orders received
during the four most recently ended Fiscal Quarters.
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Article 7
INFORMATION AND REPORTING REQUIREMENTS
7.1 Financial and Business Information of Borrower and Its
Subsidiaries. As long as any Loan remains unpaid or any other Obligation remains
unpaid, or any portion of the Commitment remains outstanding, Borrower shall,
unless the Administrative Agent (with the approval of the Majority Banks)
otherwise consents in writing, deliver to the Administrative Agent and each of
the Banks (except as otherwise provided below) at its own expense:
(a) As soon as reasonably possible, and in any event within 60
days after the close of each Fiscal Quarter of Borrower (other than the
fourth Fiscal Quarter), (i) the consolidated and consolidating balance
sheet of Borrower and its Consolidated Subsidiaries as of the end of
such Fiscal Quarter, setting forth in comparative form the corresponding
figures for the corresponding Fiscal Quarter of the preceding Fiscal
Year, if available, and (ii) the consolidated and consolidating
statements of profit and loss and the consolidated statements of cash
flows of Borrower and its Consolidated Subsidiaries for such Fiscal
Quarter and for the portion of the Fiscal Year ended with such Fiscal
Quarter, setting forth in comparative form the corresponding periods of
the preceding Fiscal Year. Such consolidated and consolidating balance
sheets and statements shall be prepared in reasonable detail in
accordance with Generally Accepted Accounting Principles (other than
those which require footnote disclosure of certain matters) consistently
applied, and shall be certified by the principal financial officer of
Borrower, subject to normal year-end accruals and audit adjustments;
(b) As soon as reasonably possible, and in any event within 90
days after the close of each Fiscal Year of Borrower, (i) the
consolidated and consolidating (in accordance with past practices of
Borrower) balance sheets of Borrower and its Consolidated Subsidiaries
as at the end of such Fiscal Year, setting forth in comparative form the
corresponding figures at the end of the preceding Fiscal Year and (ii)
the consolidated and consolidating (in accordance with past practices of
Borrower) statements of profit and loss and the consolidated statements
of cash flows of Borrower and its Consolidated Subsidiaries for such
Fiscal Year, setting forth in comparative form the corresponding figures
for the previous Fiscal Year. Such consolidated and consolidating
balance sheet and statements shall be prepared in reasonable detail in
accordance with Generally Accepted Accounting Principles consistently
applied. Such consolidated balance sheet and statements shall be
accompanied by a report and opinion of Ernst & Young or other
independent certified public accountants of recognized national standing
selected by Borrower (i.e., a "big five" firm), which report and
opinion shall state that the examination of such consolidated financial
statements by such accountants was made in accordance with generally
accepted auditing standards and that such consolidated financial
statements fairly present the financial condition, results of operations
and of cash flows of Borrower and its Subsidiaries subject to no
exceptions as to scope of audit and subject to no other exceptions or
qualifications (other than changes in accounting principles in which the
auditors concur) unless such other exceptions or qualifications are
approved by the Majority Banks in their reasonable discretion. Such
accountants' report and opinion shall be accompanied by a certificate
stating that, in conducting the audit examination of books and records
necessary for the certification of such financial statements, such
accountants have obtained no knowledge of any Default or Event of
Default hereunder or, if in the opinion of such accountants, any such
Default or Event of Default shall exist, stating the nature and status
of such event, and setting forth the applicable calculations under
Sections 6.9, 6.10, 6.11, 6.15 (without requiring any physical count of
inventory) and 6.16, as of the date of the balance sheet.
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Such consolidating balance sheet and statements shall be certified by
the principal financial officer of Borrower;
(c) Promptly after the receipt thereof by Borrower, copies of any
audit or management reports submitted to it by independent accountants
in connection with any audit or interim audit submitted to the board of
directors of Borrower or any of its Subsidiaries;
(d) Promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication
sent to its stockholders, and copies of all annual, regular, periodic
and special reports and registration statements which Borrower may file
or be required to file with the Commission or any similar or
corresponding Governmental Agency or with any securities exchange;
(e) Promptly upon a Senior Officer of Borrower becoming aware,
and in any event within ten Banking Days after becoming aware, of the
occurrence of any (i) "reportable event" (as such term is defined in
Section 4043 of ERISA) other than any such event as to which the PBGC
has by regulation waived the requirement of 30 days' notice or (ii)
"prohibited transaction" (as such term is defined in Section 406 of
ERISA or Section 4975 of the Code) in connection with any Pension Plan,
other than a Multiemployer Plan, or any trust created thereunder, a
written notice specifying the nature thereof, what action Borrower and
any of its Subsidiaries is taking or proposes to take with respect
thereto, and, when known, any action taken by the Internal Revenue
Service with respect thereto;
(f) Promptly upon a Senior Officer of Borrower becoming aware,
and in any event within five Banking Days after becoming aware, of the
existence of a Default or an Event of Default, a written notice
specifying the nature and period of existence thereof and what action
Borrower is taking or proposes to take with respect thereto;
(g) Promptly upon a Senior Officer of Borrower becoming aware,
and in any event within five Banking Days after becoming aware, that the
holder of any evidence of Indebtedness (in a principal amount in excess
of $15,000,000) of Borrower or any of its Subsidiaries has given notice
or taken any other action with respect to a default or event of default,
a written notice specifying the notice given or action taken by such
holder and the nature of such default or event of default and what
action Borrower or its Subsidiary is taking or proposes to take with
respect thereto;
(h) Promptly upon a Senior Officer of Borrower becoming aware,
and in any event within five Banking Days after becoming aware, of the
existence of any pending or threatened litigation or any investigation
by any Governmental Agency that would constitute a Material Adverse
Effect (provided, that no failure of a Senior Officer to provide notice
of any such event shall be the sole basis for any Default or Event of
Default hereunder);
(i) As soon as possible, and in any event within 60 days after
the close of each Fiscal Quarter of Borrower (except 90 days after the
close of the Fiscal Year of Borrower), (i) a sales report by
geographical region, in the form of Exhibit F hereto, certified by a
Senior Officer of Borrower, setting forth the number of homes or other
units sold and delivered during such period and in backlog at the end of
such period, (ii) an inventory report for such Fiscal Quarter
summarizing such inventory by type and geographical region, in the form
of Exhibit G hereto and (iii) a report of any change, as of the last day
of such Fiscal Quarter, in the listing of
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Subsidiaries set forth in Schedule 4.4 (as the same may have been
revised by previous reports under this clause (i)(iii));
(j) As soon as reasonably possible, and in any event prior to the
date that is 60 days after the commencement of each Fiscal Year, deliver
to the Administrative Agent the business plan of Borrower and its
Subsidiaries for that Fiscal Year, together with projections (in
substantially the same format as the Projections) covering the next 2
Fiscal Years;
(k) Promptly following obtaining knowledge thereof by a Senior
Officer of Borrower, written notice to the Administrative Agent of the
inception or cessation of the Investment Grade Credit Rating; and
(l) Such other data and information as from time to time may be
reasonably requested by any of the Banks.
7.2 Compliance Certificate. Not later than 60 days after the close
of each Fiscal Quarter and 90 days after the close of each Fiscal Year, a
Compliance Certificate dated as of the last day of the Fiscal Quarter or Fiscal
Year, as the case may be, (a) setting forth computations showing, in detail
reasonably satisfactory to the Administrative Agent, whether Borrower and its
Subsidiaries were in compliance with their obligations to the Banks pursuant to
Sections 6.9, 6.10, 6.11, 6.15, 6.16, and 6.18, (b) setting forth a list of the
Guarantor Subsidiaries of Borrower, based upon the most current financial
statements then available, (c) either (i) stating that to the best knowledge of
the certifying officer as of the date of such certificate there is no Default or
Event of Default, or (ii) if there is a Default or Event of Default as of the
date of such certificate, specifying all such Defaults or Events of Default and
their nature and status and (d) stating, to the best knowledge of the certifying
officer, whether any event or circumstance constituting a Material Adverse
Effect (other than a Material Adverse Effect which is not particular to the
Borrower and which is generally known) has occurred since the date of the most
recent Compliance Certificate delivered under this Section and, if so,
describing such Material Adverse Effect in reasonable detail. No failure of the
certifying officer to describe the existence of an event or circumstance
constituting a Material Adverse Effect shall be the sole basis for any Default
or Event of Default hereunder.
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Article 8
CONDITIONS
8.1 Initial Advances, Etc. The obligation of each Bank to make the
Advance to be made by it is subject to the following conditions precedent, each
of which shall be satisfied prior to the making of the initial Advances (unless
all of the Banks, in their sole and absolute discretion, shall agree otherwise):
(a) The Administrative Agent shall have received all of the
following, each dated as of the 2000 Closing Date (unless otherwise
specified or unless the Administrative Agent otherwise agrees) and all
in form and substance satisfactory to the Administrative Agent and legal
counsel for the Administrative Agent:
(i) executed counterparts of this Agreement, sufficient in
number for distribution to the Banks and Borrower;
(ii) a Note executed by Borrower in favor of each Bank, each
in a principal amount equal to that Bank's Pro Rata Share of the
Commitment. Promptly following the 2000 Closing Date, the
promissory notes delivered to the Banks pursuant to the Prior
Loan Agreements shall be canceled and promptly returned to
Borrower;
(iii) the Subsidiary Guaranty executed by each Subsidiary
which is a Guarantor Subsidiary as of the 2000 Closing Date;
(iv) with respect to Borrower and each Subsidiary which is a
Guarantor Subsidiary as of the 2000 Closing Date, such
documentation as the Administrative Agent may reasonably require
to establish the due organization, valid existence and good
standing of Borrower and each such Subsidiary, its qualification
to engage in business in each jurisdiction in which it is
required to be so qualified, its authority to execute, deliver
and perform any Loan Documents to which it is a Party, and the
identity, authority and capacity of each Responsible Official
thereof authorized to act on its behalf, including, without
limitation, certified copies of articles of incorporation and
amendments thereto, bylaws and amendments thereto, certificates
of good standing and/or qualification to engage in business, tax
clearance certificates, certificates of corporate resolutions,
incumbency certificates, and the like;
(v) the Opinions of Counsel;
(vi) an Officer's Certificate of Borrower affirming, to the
best knowledge of the certifying Senior Officer, that the
conditions set forth in Sections 8.1(c) and 8.1(d) have been
satisfied;
(vii) a side letter executed by each "Bank" under the Prior
Revolving Loan Agreement that is not a "Bank" hereunder
acknowledging a termination of the "Commitments" under the Prior
Revolving Loan Agreement without charge to Borrower (except for
LIBOR breakage fees, if any) and agreeing to the other matters
specified in Section 3.16;
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(viii) a side letter executed by each "Bank" under the Prior
Term Loan Agreement that is not a "Bank" hereunder acknowledging
a termination of the "Commitment" under the Prior Term Loan
Agreement without charge to Borrower (except for LIBOR breakage
fees, if any) and agreeing to the other matters specified in
Section 3.16;
(ix) a side letter executed by each "Bank" under the Bridge
Loan Agreement that is not a "Bank" hereunder acknowledging a
termination of the "Commitment" under the Bridge Loan Agreement
without charge to Borrower (except for LIBOR breakage fees, if
any) and agreeing to the other matters specified in Section 3.16;
and
(x) such other assurances, certificates, documents, consents
or opinions relevant hereto as the Administrative Agent may
reasonably require.
(b) The upfront fee payable pursuant to Section 3.2 shall have
been paid and any fees then payable under the letter agreement referred
to in Section 3.3 shall have been paid.
(c) The representations and warranties of Borrower contained in
Article 4 shall be true and correct in all material respects on and as
of the 2000 Closing Date.
(d) Borrower and its Subsidiaries and any other Parties shall be
in compliance with all the terms and provisions of the Loan Documents,
and after giving effect to the initial Advance, no Default or Event of
Default shall have occurred and be continuing.
(e) The Banks shall have received the written legal opinion of
Sheppard, Mullin, Xxxxxxx & Xxxxxxx LLP, legal counsel to the
Administrative Agent, to the effect that the Opinions of Counsel are
acceptable and such other matters relating to the Loan Documents as the
Administrative Agent may request.
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Article 9
EVENTS OF DEFAULT AND REMEDIES UPON EVENTS OF DEFAULT
9.1 Events of Default. There will be a default hereunder if any one
or more of the following events ("Events of Default") occurs and is continuing,
whatever the reason therefor:
(a) failure to pay any installment of principal on any of the
Notes on the date when due; or
(b) failure to pay any installment of interest on any of the
Notes, or to pay any fee or other amounts due the Administrative Agent
or any Bank hereunder, within 5 Banking Days after the date when due; or
(c) any failure to comply with Sections 6.1, 6.3, 6.4 (with
respect to Acquisitions), 6.7, 6.10, 6.11, 6.14, 6.17 or 7.1(f); or
(d) any failure to comply with Sections 5.8, 5.9, 6.4 (with
respect to Investments), 6.8, 6.9, 6.15, 6.16, or 6.18 that remains
unremedied for a period of 15 calendar days after notice by the
Administrative Agent of such Default or 20 calendar days after a Senior
Officer becomes aware of such Default, whichever occurs first; or
(e) Borrower or any other Party fails to perform or observe any
other term, covenant, or agreement contained in any Loan Document on its
part to be performed or observed within 30 calendar days after notice by
the Administrative Agent of such Default; or
(f) any representation or warranty in any Loan Document or in any
certificate, agreement, instrument, or other document made or delivered,
on or after the 2000 Closing Date, pursuant to or in connection with any
Loan Document proves to have been incorrect when made in any respect
material to the ability of Borrower to duly and punctually perform all
of the Obligations; or
(g) Any failure to pay any interest or principal when due
(following any applicable cure period) under the Mortgage Warehousing
Agreement to which Administrative Agent is a party or under any Money
Market Facility; or
(h) Borrower or any of its Significant Subsidiaries (i) fails to
pay the principal, or any principal installment, of any present or
future Indebtedness (other than Non-Recourse Indebtedness, and in the
case of the Mortgage Company, arising under the Mortgage Warehousing
Agreements), or any guaranty of present or future Indebtedness (other
than Non-Recourse Indebtedness) on its part to be paid, when due (or
within any stated grace period), whether at the stated maturity, upon
acceleration, by reason of required prepayment or otherwise in excess of
$25,000,000 individually or $50,000,000 in the aggregate or (ii) fails
to perform or observe any other material term, covenant, or agreement on
its part to be performed or observed, or suffers to exist any condition,
in connection with any present or future Indebtedness (other than
Non-Recourse Indebtedness, and in the case of the Mortgage Company,
arising under the Mortgage Warehousing Agreements) or any guaranty of
present or future Indebtedness (other than Non-Recourse Indebtedness),
in excess of $25,000,000 individually or $50,000,000 in the aggregate,
if as a result of such failure or such condition any
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holder or holders thereof (or an agent or trustee on its or their
behalf) has the right to declare it due before the date on which it
otherwise would become due; or
(i) any Loan Document, at any time after its execution and
delivery and for any reason other than the agreement of all the Banks or
satisfaction in full of all the Obligations, ceases to be in full force
and effect or is declared by a court of competent jurisdiction to be
null and void, invalid, or unenforceable in any respect which is, in the
reasonable opinion of the Majority Banks, materially adverse to the
interest of the Banks; or
(j) a final judgment (or judgments) against Borrower or any of
its Significant Subsidiaries is entered for the payment of money in
excess of $25,000,000 individually or $50,000,000 in the aggregate over
the amount of any insurance proceeds reasonably expected to be received
and remains unsatisfied without procurement of a stay of execution
within thirty (30) calendar days after the issuance of any writ of
execution or similar legal process or the date of entry of judgment,
whichever is earlier, or in any event at least 5 calendar days prior to
the sale of any assets pursuant to such legal process; or
(k) Borrower or any Significant Subsidiary of Borrower institutes
or consents to any proceeding under a Debtor Relief Law relating to it
or to all or any part of its Property, or fails generally to pay its
debts as they mature, or makes a general assignment for the benefit of
creditors; or applies for or consents to the appointment of any
receiver, trustee, custodian, conservator, liquidator, rehabilitator, or
similar officer for it or for all or any part of its property; or any
receiver, trustee, custodian, conservator, liquidator, rehabilitator, or
similar officer is appointed without the application or consent of that
Person and the appointment continues undischarged or unstayed for 60
calendar days; or any proceeding under any Debtor Relief Law relating to
any such Person or to all or any part of its Property is instituted
without the consent of that Person, and continues undismissed or
unstayed for 60 calendar days; or
(l) the occurrence of a Termination Event with respect to any
Pension Plan if the aggregate liability of Borrower and its ERISA
Affiliates under ERISA as a result thereof exceeds $25,000,000; or the
complete or partial withdrawal by Borrower or any of its ERISA
Affiliates from any Multiemployer Plan if the aggregate liability of
Borrower and its ERISA Affiliates as a result thereof exceeds
$25,000,000; or
(m) any determination is made by a court of competent
jurisdiction that payment of principal or interest or both is due to the
holder of any Subordinated Obligations which would not be permitted by
Section 6.1 or that any Subordinated Obligation is not subordinated in
accordance with its terms to the Obligations; or
(n) the occurrence of an Event of Default (as defined in the 2000
Revolving Loan Agreement), so long as any Advance (as defined in the
2000 Revolving Loan Agreement) remains unpaid or any other Obligation
(as defined in the 2000 Revolving Loan Agreement) remains unpaid, or any
portion of the Commitment (as defined in the 2000 Revolving Loan
Agreement) remains in force.
9.2 Remedies Upon Event of Default. Without limiting any other
rights or remedies of the Administrative Agent or the Banks provided for
elsewhere in this Agreement or the Loan Documents, or by applicable Law or in
equity, or otherwise:
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(a) Upon the occurrence of any Event of Default, and so long as
any such Event of Default shall be continuing (other than an Event of
Default described in Section 9.1(k) with respect to Borrower or a
Guarantor Subsidiary), the Majority Banks may request the Administrative
Agent to, and the Administrative Agent thereupon shall, declare the
unpaid principal of all Obligations due to the Banks hereunder and under
the Notes, all interest accrued and unpaid thereon, and all other
amounts payable to the Banks under the Loan Documents to be forthwith
due and payable, whereupon the same shall become and be forthwith due
and payable, without protest, presentment, notice of dishonor, demand,
or further notice of any kind, all of which are expressly waived by
Borrower; provided that the Administrative Agent shall notify Borrower
(by telecopy and, if practicable, by telephone) substantially
concurrently with any such acceleration (but the failure of Borrower to
receive such notice shall not affect such acceleration).
(b) Upon the occurrence of any Event of Default described in
Section 9.1(k) with respect to Borrower or a Guarantor Subsidiary, the
unpaid principal of all Obligations due to the Banks hereunder and under
the Notes and all interest accrued and unpaid on such Obligations, and
all other amounts payable under the Loan Documents shall be forthwith
due and payable, without protest, presentment, notice of dishonor,
demand, or further notice of any kind, all of which are expressly waived
by Borrower.
(c) Upon the occurrence of an Event of Default, the Banks and the
Administrative Agent, or any of them, may proceed to protect, exercise,
and enforce their rights and remedies under the Loan Documents against
Borrower or any other Party and such other rights and remedies as are
provided by Law or equity, without notice to or demand upon Borrower
(which are expressly waived by Borrower) except to the extent required
by applicable Laws. The order and manner in which the rights and
remedies of the Banks under the Loan Documents and otherwise are
exercised shall be determined by the Majority Banks.
(d) All payments received by the Administrative Agent and the
Banks, or any of them, after the acceleration of the maturity of the
Loans shall be applied first to the costs and expenses (including
attorneys' fees and disbursements) of the Administrative Agent, acting
as Administrative Agent, and of the Banks and thereafter paid pro rata
to the Banks in the same proportion that the aggregate of the unpaid
principal amount owing on the Obligations of Borrower to each Bank, plus
accrued and unpaid interest thereon, bears to the aggregate of the
unpaid principal amount owing on all the Obligations, plus accrued and
unpaid interest thereon. Regardless of how each Bank may treat the
payments for the purpose of its own accounting, for the purpose of
computing Borrower's Obligations, the payments shall be applied first,
to the costs and expenses of the Administrative Agent, acting as
Administrative Agent, and the Banks as set forth above, second, to the
payment of accrued and unpaid fees hereunder and interest on all
Obligations to the Banks, to and including the date of such application
(ratably according to the accrued and unpaid interest on the Loans),
third, to the ratable payment of the unpaid principal of all Obligations
to the Banks, and fourth, to the payment of all other amounts then owing
to the Administrative Agent or the Banks under the Loan Documents.
Subject to Section 9.2(a), no application of the payments will cure any
Event of Default or prevent acceleration, or continued acceleration, of
amounts payable under the Loan Documents or prevent the exercise, or
continued exercise, of rights or remedies of the Banks hereunder or
under applicable Law unless all amounts then due (whether by
acceleration or otherwise) have been paid in full.
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Article 10
THE ADMINISTRATIVE AGENT
10.1 Appointment and Authorization. Subject to Section 10.7, each
Bank hereby irrevocably appoints and authorizes the Administrative Agent to take
such action as agent on its behalf and to exercise such powers under the Loan
Documents as are delegated to the Administrative Agent by the terms thereof or
are reasonably incidental, as determined by the Administrative Agent, thereto.
This appointment and authorization does not constitute appointment of the
Administrative Agent as trustee for any Bank and, except as specifically set
forth herein to the contrary, the Administrative Agent shall take such action
and exercise such powers only in an administrative and ministerial capacity.
10.2 Administrative Agent and Affiliates. Bank of America (and each
successor Administrative Agent) has the same rights and powers under the Loan
Documents as any other Bank and may exercise the same as though it were not the
Administrative Agent; and the term "Bank" or "Banks" includes Bank of America in
its individual capacity. Bank of America (and each successor Administrative
Agent) and its respective Affiliates may accept deposits from, lend money to,
and generally engage in any kind of banking, trust or other business with
Borrower and any Affiliate of Borrower, as if it were not the Administrative
Agent and without any duty to account therefor to the Banks. Bank of America
(and each successor Administrative Agent) need not account to any other Bank for
any monies received by it for reimbursement of its costs and expenses as
Administrative Agent hereunder, or for any monies received by it in its capacity
as a Bank hereunder, except as otherwise provided herein.
10.3 Banks' Credit Decisions. Each Bank agrees that it has,
independently and without reliance upon the Administrative Agent, any other
Bank, or the directors, officers, agents, or employees of the Administrative
Agent or of any other Bank, and instead in reliance upon information supplied to
it by or on behalf of Borrower and its Subsidiaries and upon such other
information as it has deemed appropriate, made its own independent credit
analysis and decision to enter into this Agreement. Each Bank also agrees that
it shall, independently and without reliance upon the Administrative Agent, any
other Bank, or the directors, officers, agents, or employees of the
Administrative Agent or of any other Bank, continue to make its own independent
credit analyses and decisions in acting or not acting under the Loan Documents.
10.4 Action by Administrative Agent.
(a) The Administrative Agent may assume that no Default or Event
of Default has occurred and is continuing, unless the Administrative
Agent has actual knowledge of the Default or Event of Default, has
received notice from Borrower stating the nature of the Default or Event
of Default, or has received notice from a Bank stating the nature of the
Default or Event of Default and that Bank considers the Default or Event
of Default to have occurred and to be continuing.
(b) The Administrative Agent has only those obligations under the
Loan Documents that are expressly set forth therein. Without limitation
on the foregoing, the Administrative Agent shall have no duty to inspect
any property of Borrower or any of its Subsidiaries, although the
Administrative Agent may in its discretion periodically inspect any
property from time to time.
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(c) Except for any obligation expressly set forth in the Loan
Documents and as long as the Administrative Agent may assume that no
Event of Default has occurred and is continuing, the Administrative
Agent may, but shall not be required to, exercise its discretion to act
or not act, except that the Administrative Agent shall be required to
act or not act upon the instructions of the Majority Banks (or of all
the Banks, to the extent required by Section 11.2) and those
instructions shall be binding upon the Administrative Agent and all the
Banks, provided that the Administrative Agent shall not be required to
act or not act if to do so would, in the reasonable judgment of the
Administrative Agent, expose the Administrative Agent to significant
liability or would be contrary to any Loan Document or to applicable
law.
(d) If the Administrative Agent has received a notice specified
in clause (a), the Administrative Agent shall give notice thereof to the
Banks and shall act or not act upon the instructions of the Majority
Banks (or of all the Banks, to the extent required by Section 11.2). If
the Majority Banks fail for three (3) Banking Days after the receipt of
notice from the Administrative Agent, to instruct the Administrative
Agent, then the Administrative Agent, in its sole discretion, may act or
not act as it deems advisable for the protection of the interests of the
Banks.
(e) The Administrative Agent shall have no liability to any Bank
for acting, or not acting, as instructed by the Majority Banks (or all
the Banks, if required under Section 11.2), notwithstanding any other
provision hereof.
10.5 Liability of Administrative Agent. Neither the Administrative
Agent, the Lead Arranger and Sole Book Manager or any of their Affiliates nor
any of its respective directors, officers, agents, or employees shall be liable
to any Bank for any action taken or not taken by them under or in connection
with the Loan Documents, except for their own gross negligence or willful
misconduct. Without limitation on the foregoing, the Administrative Agent and
its respective directors, officers, agents, and employees:
(a) may treat the payee of any Note as the holder thereof until
the Administrative Agent receives notice of the assignment or transfer
thereof in form satisfactory to the Administrative Agent, signed by the
payee and may treat each Bank as the owner of that Bank's interest in
the obligations due to Banks for all purposes of this Agreement until
the Administrative Agent receives notice of the assignment or transfer
thereof, in form satisfactory to the Administrative Agent, signed by
that Bank;
(b) may consult with legal counsel, in-house legal counsel,
independent public accountants, in-house accountants and other
professionals, or other experts selected by it, or with legal counsel,
independent public accountants, or other experts for Borrower, and shall
not be liable to any Bank for any action taken or not taken by it or
them in good faith in accordance with the advice of such legal counsel,
independent public accountants, or experts;
(c) will not be responsible to any Bank for any statement,
warranty, or representation made in any of the Loan Documents or in any
notice, certificate, report, request, or other statement (written or
oral) in connection with any of the Loan Documents;
(d) except to the extent expressly set forth in the Loan
Documents, will have no duty to ascertain or inquire as to the
performance or observance by Borrower or any other
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Person of any of the terms, conditions, or covenants of any of the Loan
Documents or to inspect the property, books, or records of Borrower or
any of its Subsidiaries or other Person;
(e) will not be responsible to any Bank for the due execution,
legality, validity, enforceability, genuineness, effectiveness,
sufficiency, or value of any Loan Document, any other instrument or
writing furnished pursuant thereto or in connection therewith;
(f) will not incur any liability to any Bank by acting or not
acting in reliance upon any Loan Document, notice, consent, certificate,
statement, or other instrument or writing believed by it or them to be
genuine and signed or sent by the proper party or parties; and
(g) will not incur any liability for any arithmetical error in
computing any amount payable to or receivable from any Bank hereunder,
including without limitation payment of principal and interest on the
Notes, payment of commitment fees, Loans, and other amounts; provided
that promptly upon discovery of such an error in computation, the
Administrative Agent, the Banks, and (to the extent applicable) Borrower
shall make such adjustments as are necessary to correct such error and
to restore the parties to the position that they would have occupied had
the error not occurred.
10.6 Indemnification. Each Bank shall, ratably in accordance with
its respective Pro Rata Share of the Commitment, indemnify and hold the
Administrative Agent, the Lead Arranger and Sole Book Manager and their
Affiliates and their respective directors, officers, agents, and employees
harmless against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses, or disbursements of any
kind or nature whatsoever (including, without limitation, attorney's fees and
disbursements) that may be imposed on, incurred by, or asserted against it or
them in any way relating to or arising out of this Agreement (other than losses
incurred by reason of the failure by Borrower to pay the obligations due to the
Administrative Agent under a Note) or any action taken or not taken by it as
Administrative Agent thereunder, except for the Administrative Agent's gross
negligence or willful misconduct. Without limitation on the foregoing, each Bank
shall reimburse the Administrative Agent upon demand for that Bank's ratable
share of any cost or expense incurred by the Administrative Agent in connection
with the negotiation, preparation, execution, delivery, administration,
amendment, waiver, refinancing, restructuring, reorganization (including a
bankruptcy reorganization), or enforcement of the Loan Documents, to the extent
that Borrower is required by Section 11.3 to pay that cost or expense but fails
to do so upon demand. Any such reimbursement shall not relieve Borrower of its
obligations under Section 11.3.
10.7 Successor Administrative Agent. The Administrative Agent may
resign as such at any time by written notice to Borrower and the Banks, to be
effective upon a successor's acceptance of appointment as Administrative Agent.
The Majority Banks may at any time remove the Administrative Agent by written
notice to that effect to be effective on such date as the Majority Banks
designate. In either event, the Majority Banks shall appoint a successor
Administrative Agent or Agents, who must be from among the Banks and who shall
be subject to the prior approval of Borrower, which approval shall not be
unreasonably withheld or delayed, provided, that the Administrative Agent shall
be entitled to appoint a successor Administrative Agent from among the Banks,
subject to acceptance of appointment by that successor Administrative Agent, if
the Majority Banks have not appointed a successor Administrative Agent within
thirty (30) days after the date the Administrative Agent gave notice of
resignation or was removed. Upon a successor's acceptance of appointment as
Administrative Agent, the successor will thereupon succeed to and become vested
with all the rights, powers, privileges, and duties of the Administrative Agent
under the Loan Documents,
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and the resigning or removed Administrative Agent will thereupon be discharged
from its duties and obligations thereafter arising under the Loan Documents.
After any retiring Administrative Agent's resignation or removal hereunder as
Administrative Agent, the provisions of this Article 10 and Sections 11.3 and
11.10 shall inure to its benefit as to any action taken or omitted to be taken
by it while it was Administrative Agent under this Agreement.
10.8 No Obligations of Borrower. Nothing contained in this Article
10 shall be deemed to impose upon Borrower any obligation in respect of the due
and punctual performance by the Administrative Agent of its obligations to the
Banks under any provision of this Agreement, and Borrower shall have no
liability to the Administrative Agent or any of the Banks in respect of any
failure by the Administrative Agent or any Bank to perform any of its
obligations to the Administrative Agent or the Banks under this Agreement.
Without limiting the generality of the foregoing, where any provision of this
Agreement relating to the payment of any amounts due and owing under the Loan
Documents provides that such payments shall be made by Borrower to the
Administrative Agent for the account of the Banks, Borrower's obligations to the
Banks in respect of such payments shall be deemed to be satisfied upon the
making of such payments to the Administrative Agent in the manner provided by
this Agreement.
10.9 Defaulting Banks. If for any reason any Bank wrongfully (in
violation of this Agreement) fails or refuses to timely make any Advance
required of it, or otherwise defaults on any of its material obligations under
this Agreement, and fails to cure its default within 5 Banking Days of receiving
notice of its failure to perform (such Bank being a "Defaulting Bank"), then in
addition to the rights and remedies that may be available to the Administrative
Agent and the Banks at law or in equity, the Defaulting Bank's right to
participate in the Loan and the Agreement will be suspended during the pendency
of the Defaulting Bank's uncured default, and (without limiting the foregoing)
the Administrative Agent may (or at the direction of the Majority Banks, shall)
withhold from the Defaulting Bank any interest payments, fees, principal
payments or other sums otherwise payable to such Defaulting Bank under the Loan
Documents until such default of such Defaulting Bank has been cured. Each
non-defaulting Bank will have the right, but not the obligation, in its sole
discretion, to acquire at par a proportionate share (based on the ratio of its
Pro Rata Share of the Commitment to the aggregate amount of the Pro Rata Shares
of the Commitments of all of the non-defaulting Banks that elect to acquire a
share of the Defaulting Bank's Pro Rata Share of the Commitment) of the
Defaulting Bank's Pro Rata Share of the Commitment, including without limitation
its proportionate share in the outstanding principal balance of the Loans. The
Defaulting Bank will pay and protect, defend and indemnify Administrative Agent
and each of the other Banks against, and hold Administrative Agent, and each of
the other Banks harmless from, all claims, actions, proceedings, liabilities,
damages, losses, and expenses (including without limitation attorneys' fees and
costs, and interest at the Prime Rate plus 2.0% per annum for the funds advanced
by Administrative Agent or any Banks on account of the Defaulting Bank) they may
sustain or incur by reason of or in consequence of the Defaulting Bank's failure
or refusal to perform its obligations under the Loan Documents. Administrative
Agent may set off against payments due to the Defaulting Bank for the claims of
Administrative Agent and the other Banks against the Defaulting Bank. The
exercise of these remedies will not reduce, diminish or liquidate the Defaulting
Bank's Pro Rata Share of the Commitment (except to the extent that part or all
of such Pro Rata Share of the Commitment is acquired by the other Banks as
specified above) or its obligations to share losses and reimbursement for costs,
liabilities and expenses under this Agreement. This indemnification will survive
the payment and satisfaction of all of the Borrower's obligations and
liabilities to the Banks. The foregoing provisions of this Section 10.9 are
solely for the benefit of the Administrative Agent and the Banks, and may not be
enforced or relied upon by the Borrower.
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Article 11
MISCELLANEOUS
11.1 Cumulative Remedies; No Waiver. The rights, powers, and
remedies of the Administrative Agent or any Bank provided herein or in any Note
or other Loan Document are cumulative and not exclusive of any right, power, or
remedy provided by law or equity. No failure or delay on the part of the
Administrative Agent or any Bank in exercising any right, power, or remedy may
be, or may be deemed to be, a waiver thereof; nor may any single or partial
exercise of any right, power, or remedy preclude any other or further exercise
of any other right, power, or remedy. The terms and conditions of Section 8.1
hereof are inserted for the sole benefit of the Banks and the Administrative
Agent may (with the approval of the Majority Banks) waive them in whole or in
part with or without terms or conditions in respect of any Loan, without
prejudicing the Banks' rights to assert them in whole or in part in respect of
any other Loans.
11.2 Amendments; Consents. No amendment, modification, supplement,
termination, or waiver of any provision of this Agreement or any other Loan
Document, and no consent to any departure by Borrower or any other Party
therefrom, may in any event be effective unless in writing signed by the
Administrative Agent with the approval of the Majority Banks and Borrower, and
then only in the specific instance and for the specific purpose given; and
without the approval in writing of all the Banks, no amendment, modification,
supplement, termination, waiver, or consent may be effective:
(a) to amend or modify the principal of, or the amount of
principal or principal prepayments, payable on any Obligation or the
amount of the Commitment or to decrease the rate of any interest or fee
payable to any Bank;
(b) to postpone any date fixed for any payment of principal of,
prepayment of principal of, or any installment of interest on, any
Obligation or any installment of any fee or to extend the term of the
Commitment;
(c) to amend or modify the provisions of the definition in
Section 1.1 of "Majority Banks" or of Sections 11.2, 11.9, 11.10, or
11.11;
(d) release any Guarantor Subsidiary from liability under the
Subsidiary Guaranty (except as provided below); or
(e) to amend or modify any provision of this Agreement or the
Loan Documents that expressly requires the consent or approval of all
the Banks.
Any amendment, modification, supplement, termination, waiver or consent pursuant
to this Section 11.2 shall apply equally to, and shall be binding upon, all the
Banks and the Agents. Any amendment, modification, supplement, termination,
waiver or consent pursuant to this Section 11.2 that permits the sale or other
transfer of the capital stock of (or all or substantially all of the assets of)
a Guarantor Subsidiary shall automatically release the Guarantor Subsidiary
effective concurrently with such sale or other transfer.
11.3 Costs, Expenses and Taxes. Borrower shall pay within 30 days
after demand (which demand shall be accompanied by an invoice in reasonable
detail) the reasonable actual out-of-pocket costs and expenses of the
Administrative Agent and Lead Arranger and Sole Book
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Manager in connection with (a) the negotiation, preparation, execution,
delivery, arrangement, syndication and closing of the Loan Documents, provided
that such costs and expenses do not exceed the amounts referred to in a letter
agreement between Borrower and the Administrative Agent and Lead Arranger and
Sole Book Manager, (b) administration of the Loan Documents, provided that such
costs and expenses do not exceed the amounts set forth in a letter agreement
between Borrower and the Administrative Agent and Lead Arranger and Sole Book
Manager and (c) any amendment, waiver or modification of the Loan Documents.
Borrower shall pay within 30 days after demand the reasonable actual
out-of-pocket costs and expenses of the Administrative Agent and each of the
Banks in connection with the enforcement of any Loan Documents following the
occurrence of a Default or an Event of Default, including in connection with any
refinancing, restructuring, reorganization (including a bankruptcy
reorganization, if such payment is approved by the bankruptcy court or any
similar proceeding). The costs and expenses referred to in the first sentence
above (for which Borrower shall be liable solely with respect to costs and
expenses of the Administrative Agent and Lead Arranger and Sole Book Manager)
and the second sentence above (which shall apply to costs and expenses of the
Administrative Agent and the Banks) shall include filing fees, recording fees,
title insurance fees, appraisal fees, search fees, and other out-of-pocket
expenses and the reasonable actual fees and out-of-pocket expenses of any legal
counsel retained by the Administrative Agent and Lead Arranger and Sole Book
Manager or any of the Banks (including the allocated costs of in-house counsel),
as the case may be, or independent public accountants and other outside experts
retained by the Administrative Agent and Lead Arranger and Sole Book Manager
(provided that (i) Borrower shall not be liable under this Section 11.3 for fees
and expenses of more than one firm of independent public accountants, or more
than one expert with respect to a specific subject matter, at any one time and
(ii) with respect to the costs and expenses referred to in the second sentence
above (pertaining to enforcement matters), Borrower shall not be liable for the
fees and expenses of more than one firm of outside legal counsel retained to
represent the Administrative Agent and the Banks, but if any of such parties
does not consent to such joint representation, Borrower shall be liable for the
fees and expenses of not more than one firm of outside legal counsel retained to
represent the Administrative Agent and also for not more than one additional
firm of outside legal counsel retained to otherwise represent one or more of the
Banks). Nothing herein shall obligate Borrower to pay any costs and expenses in
connection with an assignment of or participation in a Bank's Pro-Rata Share of
a Commitment. Borrower shall pay any and all documentary and transfer taxes,
assessments or charges made by any Governmental Agency and all reasonable actual
costs, expenses, fees, and charges of Persons (other than the Administrative
Agent and Lead Arranger and Sole Book Manager or the Banks) payable or
determined to be payable in connection with the execution, delivery, filing or
recording of this Agreement, any other Loan Document, or any other instrument or
writing to be delivered hereunder or thereunder, and shall reimburse, hold
harmless, and indemnify the Administrative Agent and Lead Arranger and Sole Book
Manager and each Bank from and against any and all loss, liability, or legal or
other expense with respect to or resulting from any delay in paying or failure
to pay any such tax, cost, expense, fee, or charge or that any of them may
suffer or incur by reason of the failure of Borrower to perform any of its
Obligations. Any amount payable to the Administrative Agent and Lead Arranger
and Sole Book Manager or any Bank under this Section shall bear interest from
the date which is 30 days after Borrower's receipt of demand (together with
reasonable supporting documentation) for payment at the rate then in effect for
Prime Rate Loans.
11.4 Nature of Banks' Obligations. Nothing contained in this
Agreement or any other Loan Document and no action taken by the Administrative
Agent or the Banks or any of them pursuant hereto or thereto may, or may be
deemed to, make the Banks a partnership, an association, a joint venture, or
other entity, either among themselves or with Borrower. Each Bank's obligation
to make any Advance pursuant hereto is several and not joint or joint and
several, and is not conditioned
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upon the performance by any other Bank of its obligation to make Advances. A
default by any Bank will not increase the Pro Rata Share of the Commitment of
any other Bank. Any Bank not in default may, if it desires, assume in such
proportion as the nondefaulting Banks agree the obligations of any Bank in
default, but is not obligated to do so.
11.5 Representations and Warranties. All representations and
warranties of Borrower and any other Party contained herein or in any other Loan
Document (including, for this purpose, all representations and warranties
contained in any certificate or other writing required to be delivered by or on
behalf of Borrower or such Party pursuant to any Loan Document) will survive the
making of the loans hereunder and the execution and delivery of the Notes, and,
in the absence of actual knowledge by the Administrative Agent or a Bank of the
untruth of any representation or warranty, have been or will be relied upon by
the Administrative Agent and that Bank, notwithstanding any investigation made
by the Administrative Agent or that Bank or on their behalf.
11.6 Notices. Except as otherwise provided in any Loan Document, all
notices, requests, demands, directions, and other communications provided for
hereunder and under any other Loan Document must be in writing and must be
mailed (provided that communications related to any Default or Event of Default
or proposed action under Section 11.2 shall not be sent solely by mail),
telegraphed, delivered, or sent by telex, telecopier or cable to the appropriate
party at the address set forth on the signature pages of this Agreement or, as
to any Party, at any other address as may be designated by it in the applicable
Loan Document or in a written notice sent to the Administrative Agent and
Borrower in accordance with this Section. Except as otherwise provided in any
Loan Document if any notice, request, demand, direction, or other communication
is given by mail it will be effective on the earlier of actual receipt or the
third Banking Day after deposited in the United States mails with first class or
airmail postage prepaid; if given by telegraph or cable, when delivered to the
telegraph company with charges prepaid; if given by telecopier, when sent; if
given by telex, when confirmed by answerback; or if given by personal delivery,
when delivered. The Administrative Agent will endeavor to forward to Borrower a
list of the contact persons and addresses of each of the Banks on a quarterly
basis, but the Administrative Agent's failure to do so will not relieve Borrower
from any notice or other requirements set forth in this Agreement.
11.7 Execution in Counterparts. This Agreement and any other Loan
Document to which Borrower is a Party may be executed in any number of
counterparts and any party hereto or thereto may execute any counterpart, each
of which when executed and delivered will be deemed to be an original and all of
which counterparts of this Agreement or any other Loan Document, as the case may
be, taken together will be deemed to be but one and the same instrument. Such
counterparts may be sent by telecopy, with the original counterparts to follow
by mail or courier. The execution of this Agreement or any other Loan Document
by any party hereto or thereto will not become effective until executed
counterparts hereof or thereof (or other evidence of execution satisfactory to
the Administrative Agent and Borrower) have been delivered to the Administrative
Agent and Borrower.
11.8 Binding Effect; Assignment.
(a) This Agreement and the other Loan Documents to which Borrower
is a Party will be binding upon and inure to the benefit of Borrower,
the Agents, each of the Banks, and their respective successors and
assigns, except that except as permitted in Section 6.3, Borrower may
not assign its rights hereunder or thereunder or any interest herein or
therein without the prior written consent of all the Banks. Any Bank may
at any time pledge its Notes or any other instrument evidencing its
rights as a Bank hereunder to a Federal Reserve Bank,
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but no such pledge shall release that Bank from its obligations
hereunder or grant to such Federal Reserve Bank the rights of a Bank
hereunder absent foreclosure of such pledge.
(b) From time to time following the 2000 Closing Date, each Bank
may assign to one or more Eligible Assignee all or any portion of its
Pro Rata Share of the Commitment; provided that (i) such Eligible
Assignee, if not then a Bank, shall be approved by each of the
Administrative Agent (which approval shall not be unreasonably withheld)
and by Borrower (which approval shall not be unreasonably withheld and
which approval shall not be necessary after an Event of Default has
occurred and is continuing), (ii) such assignment shall be evidenced by
a Commitment Assignment and Acceptance, a copy of which shall be
furnished to the Administrative Agent as hereinbelow provided; (iii)
except in the case of an assignment to an Affiliate of the assigning
Bank, to another Bank or of the entire remaining Commitment of the
assigning Bank, the assignment shall not assign a Pro Rata Share of the
Commitment equivalent to less than $20,000,000 and that is not an
integral multiple of $5,000,000 (which restrictions shall not apply
while an Event of Default has occurred and is continuing), (iv) except
in the case of an assignment of the entire remaining Commitment of the
assigning Bank, giving effect to the assignment, the assigning Bank will
not be in violation of its Applicable Minimum Hold Requirement (unless
an Event of Default has occurred and is continuing) and (v) the
effective date of any such assignment shall be as specified in the
Commitment Assignment and Acceptance, but not earlier than the date
which is 5 Banking Days after the date the Administrative Agent has
received the Commitment Assignment and Acceptance. Upon the effective
date of such Commitment Assignment and Acceptance, the Eligible Assignee
named therein shall be a Bank for all purposes of this Agreement with
the Pro Rata Shares of the Commitment therein set forth and, to the
extent of such Pro Rata Shares, the assigning Bank shall be released
from its further obligations under this Agreement. Borrower agrees that
it shall execute and deliver (against delivery by the assigning Bank to
Borrower of its Notes under this Agreement) to such assignee Bank, Notes
evidencing that assignee Bank's Pro Rata Share, and to the assigning
Bank, Notes evidencing the remaining balance Pro Rata Share retained by
the assigning Bank.
(c) By executing and delivering a Commitment Assignment and
Acceptance, the Eligible Assignee thereunder acknowledges and agrees
that: (i) other than the representation and warranty that it is the
legal and beneficial owner of the Pro Rata Shares of the Commitment
being assigned thereby free and clear of any adverse claim, the
assigning Bank has made no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or the
execution, legality, validity, enforceability, genuineness or
sufficiency of this Agreement or any other Loan Document; (ii) the
assigning Bank has made no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrower or
the performance by Borrower of its obligations under this Agreement;
(iii) it has received a copy of this Agreement, together with copies of
the most recent financial statements delivered pursuant to this
Agreement and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into
such Commitment Assignment and Acceptance; (iv) it will, independently
and without reliance upon the Administrative Agent, or any Bank and
based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not
taking action under this Agreement; (v) it appoints and authorizes the
Administrative Agent to take such action and to exercise such powers as
are delegated to the Administrative Agent by this Agreement; and (vi) it
will perform
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in accordance with their terms all of the obligations which by the terms
of this Agreement are required to be performed by it as a Bank.
(d) After receipt of a completed Commitment Assignment and
Acceptance executed by any Bank and an Eligible Assignee, and receipt of
an assignment fee of $5,000 from such Eligible Assignee, the
Administrative Agent shall, at least one Banking Day prior to the
effective date thereof, provide to Borrower and the Banks a revised
Schedule 1.1 giving effect thereto.
(e) Each Bank may from time to time grant participations to one
or more banks or other financial institutions (including another Bank)
in its Pro Rata Share of the Commitment; provided, however, that (i)
such participant, if not an Affiliate of the granting Bank, shall be
approved by Borrower (which approval shall not be unreasonably withheld
and which approval shall not be necessary after an Event of Default has
occurred and is continuing), (ii) such Bank's obligations under this
Agreement shall remain unchanged, (iii) such Bank shall remain solely
responsible to the other parties hereto and thereto for the performance
of such obligations, (iv) the participating bank or other financial
institution shall not be a Bank hereunder for any purpose except, if
the participation agreement so provides, for the purposes of recovery of
eurodollar costs or capital adequacy expenses or indemnifications
provided to the Banks under this Agreement but only to the extent that
the cost of such benefits to Borrower does not exceed the cost which
Borrower would have incurred in respect of such Bank absent the
participation, (v) the participating bank or other financial institution
shall be prohibited from transferring, encumbering or granting any
sub-participation interest in the participation interest, (vi) Borrower,
the Administrative Agent, and the other Banks shall continue to deal
solely and directly with such Bank in connection with such Bank's rights
and obligations under this Agreement, (vii) the participation interest
granted shall not be with respect to a Pro Rata Share of the Commitment
equivalent to less than $20,000,000 (which restriction shall not apply
while an Event of Default has occurred and is continuing), (viii) giving
effect to the participation, the granting Bank will not be in violation
of its Applicable Minimum Hold Requirement (unless an Event of Default
has occurred and is continuing), (ix) the consent of the holder of such
participation interest shall not be required for amendments or waivers
of provisions of the Loan Documents other than those which (A) extend
the maturity dates or any other date upon which any payment of money is
due to the Banks, (B) reduce the rate of interest, any fee or any other
monetary amount payable to the Banks, (C) reduce the amount of any
installment of principal due to the Banks thereunder, (D) release any
Guarantor Subsidiary from its obligations under the Subsidiary Guaranty
(except as provided in Section 11.2), or (E) release any material
portion of any collateral securing any of the obligations of Borrowers
to the Banks and (x) to the extent that the holder of the participation
interest is granted consent rights with respect to the matters described
in clause (ix), such rights must be subject to a voting procedure
whereby the holders of the entire Pro Rata Share of the Commitment held
by the participating Bank shall act in such matters in accordance with
the vote of a majority-in-interest of such Pro Rata Share of the
Commitment.
11.9 Sharing of Setoffs. Each Bank severally agrees that if it,
through the exercise of the right of setoff, banker's lien, or counterclaim
against Borrower or otherwise, receives payment of the Obligations due it
hereunder and under the Notes that is ratably more than that to which it is
entitled hereunder pursuant to Section 3.12 or 9.2(d), then: (a) the Bank
exercising the right of setoff, banker's lien, or counterclaim or otherwise
receiving such payment shall purchase, and shall be deemed to have
simultaneously purchased, from the other Bank a participation in the Obligations
held by the other Bank
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and shall pay to the other Bank a purchase price in an amount so that the share
of the Obligations held by each Bank after the exercise of the right of setoff,
banker's lien, or counterclaim or receipt of payment shall be in the same
proportion that existed prior to the exercise of the right of setoff, banker's
lien, or counterclaim or receipt of payment, and (b) such other adjustments and
purchases of participations shall be made from time to time as shall be
equitable to ensure that all of the Banks share any payment obtained in respect
of the Obligations ratably in accordance with the provisions of Section 3.12 and
9.2(d), provided that, if all or any portion of a disproportionate payment
obtained as a result of the exercise of the right of setoff, banker's lien,
counterclaim or otherwise is thereafter recovered from the purchasing Bank by
Borrower or any Person claiming through or succeeding to the rights of Borrower,
the purchase of a participation shall be rescinded and the purchase price
thereof shall be restored to the extent of the recovery, but without interest.
Each Bank that purchases a participation in the Obligations pursuant to this
Section shall from and after the purchase have the right to give all notices,
requests, demands, directions and other communications under this Agreement with
respect to the portion of the Obligations purchased to the same extent as though
the purchasing Bank were the original owner of the Obligations purchased.
Borrower expressly consents to the foregoing arrangements and agrees that, to
the extent permitted by Law, any Bank holding a participation in an Obligation
so purchased may exercise any and all rights of setoff, banker's lien or
counterclaim with respect to the participation as fully as if the Bank were the
original owner of the Obligation purchased.
11.10 Indemnity by Borrower. Borrower agrees to indemnify, save,
and hold harmless the Administrative Agent and Lead Arranger and Sole Book
Manager and each Bank and their directors, officers, agents, attorneys, and
employees (collectively, the "indemnitees") from and against: (i) any and all
claims, demands, actions or causes of action that are asserted against any
indemnitee (other than by Borrower or by any other indemnitee) if the claim,
demand, action or cause of action arises out of or relates to a Commitment, the
use of proceeds of any Loans, any transaction contemplated pursuant to this
Agreement, or any relationship or alleged relationship of any indemnitee to
Borrower related to this Agreement; (ii) any administrative or investigative
proceeding by any Governmental Agency arising out of or related to a claim,
demand, action or cause of action described in clause (i) above; and (iii) any
and all liabilities, losses, costs, or expenses (including reasonable attorneys'
fees and disbursements (including the allocated cost of in-house counsel)) that
any indemnitee suffers or incurs as a result of any of the foregoing; provided,
that Borrower shall have no obligation under this Section to any indemnitee with
respect to any of the foregoing arising out of the gross negligence or willful
misconduct of that indemnitee or the breach by the indemnitee of this Agreement
or from the transfer or disposition of any Note by any Bank. If any claim,
demand, action or cause of action is asserted against any indemnitee, such
indemnitee shall promptly notify Borrower, but the failure to so promptly notify
Borrower shall not affect Borrower's obligations under this Section unless such
failure materially prejudices Borrower's right to participate in the contest of
such claim, demand, action or cause of action, as hereinafter provided. If
requested by Borrower in writing and so long as no Default or Event of Default
shall have occurred and be continuing, such indemnitee shall in good faith
contest the validity, applicability and amount of such claim, demand, action or
cause of action, shall permit Borrower to participate in such contest and shall
cooperate with Borrower to the extent their interests are aligned. Any
indemnitee that proposes to settle or compromise any claim or proceeding for
which Borrower may be liable for payment of indemnity hereunder shall give
Borrower written notice of the terms of such proposed settlement or compromise
reasonably in advance of settling or compromising such claim or proceeding and
shall not so settle or compromise without Borrower's written approval thereof,
which approval may be withheld in Borrower's sole discretion. Any voluntary
settlement by an indemnitee of such a claim or proceeding without Borrower's
written approval shall relieve Borrower of its obligation to indemnify that
indemnitee with respect to such claim or proceeding. In any legal action
involving more than one indemnitee, all indemnitees shall be represented by a
single legal counsel unless
-69-
76
such legal counsel determines that a defense or counterclaim is available to an
indemnitee that is not available to all indemnitees and that to assert such a
defense or counterclaim would create a conflict of interest, or a potential
conflict of interest, in which case such indemnitee shall be entitled to
separate legal counsel. Any obligation or liability of Borrower to any
indemnitee under this Section shall survive the expiration or termination of
this Agreement and the repayment of all Loans and all other Obligations owed to
the Banks.
11.11 Nonliability of Banks. The relationship between Borrower and
the Banks is, and shall at all times remain, solely that of borrower and
lenders, and the Banks and the Administrative Agent neither undertake nor assume
any responsibility or duty to Borrower to review, inspect, supervise, pass
judgment upon, or inform Borrower of any matter in connection with any phase of
Borrower's business, operations, or condition, financial or otherwise. Borrower
shall rely entirely upon its own judgment with respect to such matters, and any
review, inspection, supervision, exercise of judgment, or information supplied
to Borrower by any Bank or the Agents in connection with any such matter is for
the protection of the Banks and the Agents, and neither Borrower nor any third
party is entitled to rely thereon.
11.12 Confidentiality. Each Bank agrees that it and its employees
shall use any confidential information that such Bank may receive, directly or
indirectly, from Borrower pursuant to this Agreement only for the purposes of
this Agreement and shall hold such confidential information in confidence,
except for disclosure: to Affiliates of the Bank (provided that any such
Affiliate who is a "person" described in Rule 100(b)(1) of Regulation FD of the
Commission expressly agrees to maintain the disclosed information in confidence
or otherwise falls within the exceptions to Rule 100(a) of Regulation FD set
forth in Rule 100(b)(2) of Regulation FD); to other Banks; to legal counsel,
accountants and other professional advisors to that Bank; to regulatory
officials having jurisdiction over that Bank; as required by Law or legal
process (provided that the Bank shall, to the extent possible give sufficient
notice to Borrower of such legal process to enable Borrower to oppose such legal
process, and in any event, give written notice to Borrower of such legal process
as soon as practicable) or in connection with any legal proceeding to which that
Bank and Borrower are adverse parties; and to another financial institution in
connection with a disposition or proposed disposition to that financial
institution of all or part of that Bank's interests hereunder or a participation
interest in its Notes (provided that such disclosure is made subject to an
appropriate confidentiality agreement by such institution on terms substantially
similar to this Section). For purposes of the foregoing, "confidential
information" shall mean any information respecting Borrower or its Subsidiaries
reasonably considered by Borrower to be confidential, other than (a) information
previously filed with any Governmental Agency and available to the public, (b)
information previously published in any public medium from a source other than,
directly or indirectly, the Agents or any Bank, and (c) information previously
disclosed by Borrower to any Person not associated with Borrower without any
reasonable expectation of confidentiality. Nothing in this Section shall be
construed to create or give rise to any fiduciary duty on the part of the Agents
or the Banks to Borrower.
11.13 No Third Parties Benefited. This Agreement is made for the
purpose of defining and setting forth certain obligations, rights and duties of
Borrower, the Agents and the Banks in connection with the Commitment, and is
made for the sole benefit of Borrower, the Administrative Agent and the Banks,
and the Administrative Agent's and the Banks' successors and assigns. Except as
provided in Sections 11.8 and 11.10, no other Person shall have any rights of
any nature hereunder or by reason hereof.
-70-
77
11.14 Other Dealings. Any Bank may, without liability to account to
the other Banks, accept deposits from, lend money or provide credit facilities
to and generally engage in any kind of banking or other business with Borrower
and its Subsidiaries.
11.15 Right of Setoff - Deposit Accounts. Upon the occurrence of an
Event of Default and the acceleration of maturity of the principal indebtedness
under any of the Notes pursuant to Section 9.2, Borrower hereby specifically
authorizes each Bank in which Borrower maintains a deposit account (whether a
general or special deposit account, other than trust accounts) or a certificate
of deposit to setoff any Obligations owed to the Banks against such deposit
account or certificate of deposit without prior notice to Borrower (which notice
is hereby waived) whether or not such deposit account or certificate of deposit
has then matured. Nothing in this Section shall limit or restrict the exercise
by a Bank of any right to setoff or banker's lien under applicable Law, subject
to the approval of the Majority Banks.
11.16 Further Assurances. Borrower shall, at its expense and without
expense to the Banks or the Administrative Agent, do, execute, and deliver such
further acts and documents as any Bank or the Administrative Agent from time to
time reasonably requires for the assuring and confirming unto the Banks or the
Administrative Agent the rights hereby created or intended now or hereafter so
to be, or for carrying out the intention or facilitating the performance of the
terms of any Loan Document; provided that this Section 11.16 is not intended to
create any affirmative obligation on the part of Borrower to provide collateral
security, additional guarantors or other credit enhancement with respect to the
Obligations.
11.17 Integration. This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and supersedes all prior agreements, written or oral, on
the subject matter hereof except as expressly provided herein to the contrary;
provided that the foregoing is subject to Section 4.18 hereof. The Loan
Documents were drafted with the joint participation of Borrower and the Banks
and shall be construed neither against nor in favor of either, but rather in
accordance with the fair meaning thereof.
11.18 Governing Law. The Loan Documents shall be governed by, and
construed and enforced in accordance with, the Laws of California.
11.19 Severability of Provisions. Any provision in any Loan
Document that is held to be inoperative, unenforceable, or invalid in any
jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, or
invalid without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
11.20 Headings. Article and section headings in this Agreement and
the other Loan Documents are included for convenience of reference only and are
not part of this Agreement or the other Loan Documents for any other purpose.
11.21 Conflict in Loan Documents. To the extent there is any actual
irreconcilable conflict between the provisions of this Agreement and any other
Loan Document, the provisions of this Agreement shall prevail.
11.22 Waiver Of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
-71-
78
PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, THE NOTES, ANY
OTHER LOAN DOCUMENT OR UNDER ANY AMENDMENT, INSTRUMENT OR DOCUMENT DELIVERED OR
WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY
BANKING OR OTHER RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT, THE
NOTES OR ANY OTHER LOAN DOCUMENT AND AGREES THAT ANY SUCH ACTION OR PROCEEDING
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. ANY PARTY TO THIS AGREEMENT
MAY FILE AN ORIGINAL COUNTERPART OR COPY OF THIS SECTION WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.
11.23 Purported Oral Amendments. BORROWER EXPRESSLY ACKNOWLEDGES
THAT THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY ONLY BE AMENDED OR
MODIFIED, OR THE PROVISIONS HEREOF OR THEREOF WAIVED OR SUPPLEMENTED, BY AN
INSTRUMENT IN WRITING THAT COMPLIES WITH SECTION 11.2. BORROWER AGREES THAT IT
WILL NOT RELY ON ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR ORAL OR
WRITTEN STATEMENTS BY ANY REPRESENTATIVE OF ANY AGENT OR ANY BANK THAT DOES NOT
COMPLY WITH SECTION 11.2 TO EFFECT AN AMENDMENT, MODIFICATION, WAIVER OR
SUPPLEMENT TO THE AGREEMENT OR THE OTHER LOAN DOCUMENTS.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
-72-
79
11.24 Hazardous Materials Indemnity. Without limiting any other
indemnity provided for in the Loan Documents, Borrower agrees to indemnify the
Administrative Agent, the Lead Arranger and Sole Book Manager and each Bank and
their directors, officers, agents, attorneys, and employees (collectively, the
"indemnities") from any claim, liability, loss, cost or expense (including
reasonable attorneys' fees (including the allocated cost of in-house counsel))
directly or indirectly arising out of the use, generation, manufacture,
production, storage, release, threatened release, discharge, disposal or
presence of any Hazardous Materials if such Hazardous Materials are on, under,
about or relate to Borrower's Property or operations, so long as such claim,
liability, loss, cost or expense arises out of or relates to a Commitment, the
use of proceeds of any Loans, any transaction contemplated pursuant to this
Agreement, or any relationship or alleged relationship of any indemnitee to
Borrower related to this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
XXXXXXX AND BROAD HOME CORPORATION
By /s/ XXXXX X. XXXXXX
--------------------------------------
Xxxxx X. Xxxxxx
Vice President and Treasurer
00000 Xxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Vice President and Treasurer
Telecopier: 310.231.4140
Telephone: 000.000.0000
80
BANK OF AMERICA, N.A., as Administrative Agent and a
Bank
By: /s/ XXXXX X. XXXXXX
--------------------------------------
Xxxxx X. Xxxxxx
Principal
Domestic Lending Office
Bank of America, N.A.
0 Xxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Principal
Telecopier: 949.260.5639
Telephone: 000.000.0000
LIBOR Lending Office
Bank of America, N.A.
0 Xxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
Telecopier: 949.260.5637
Telephone: 000.000.0000
81
CREDIT LYONNAIS LOS ANGELES BRANCH
By: /s/ XXXXXX X. XXXXX
-----------------------------------------
XXXXXX X. XXXXX
FIRST VICE PRESIDENT AND MANAGER
-----------------------------------------
Printed Name and Title
Address:
Credit Lyonnais Los Angeles Branch
000 Xxxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxx
Vice President
Telephone: 000.000.0000
Telecopier: 213.623.3437
82
BANK ONE, NA
By: /s/ XXXXXXX X. XXXXXX
-----------------------------------------
XXXXXXX X. XXXXXX
SENIOR VICE PRESIDENT
-----------------------------------------
Printed Name and Title
Address:
Bank One, NA
Xxx Xxxx Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: F. Xxx Xxxxxxxxx
Telephone: 000.000.0000
Telecopier: 312.732.1117
83
BANK UNITED
By: /s/ XXXXXX X. XXXXXXX
-----------------------------------------
XXXXXX X. XXXXXXX, SVP
-----------------------------------------
Printed Name and Title
Address:
Bank United
0000 Xxxxx Xxxx Xxx.
Xxxxxxx, Xxxxx 00000
Attn: Xxx Xxxxxxx
Senior Vice President
Telephone: 000.000.0000
Telecopier: 760.804.8590
84
PNC BANK, N.A.
By: /s/ XXXXXXX X. XXXX
-----------------------------------------
XXXXXXX X. XXXX, XX. VICE PRESIDENT
-----------------------------------------
Printed Name and Title
Address:
PNC Bank, N.A.
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxxx Xxxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxxx X. Xxxx
Telephone: 000.000.0000
Telecopier: 732.220.3744
85
COMERICA BANK
By: /s/ XXX XXXXXX
-----------------------------------------
XXX XXXXXX ASSISTANT V.P.
-----------------------------------------
Printed Name and Title
Address:
Comerica Bank
Xxx Xxxxxxx Xxxxxx - XX0000
000 Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attn: Xxx Xxxxxx
Telephone: 000.000.0000
Telecopier: 313.222.3295
86
SUNTRUST BANK
By: /s/ XXXXXX X. XXXXXXXX
-----------------------------------------
XXXXXX X. XXXXXXXX DIRECTOR
-----------------------------------------
Printed Name and Title
Address:
SunTrust Bank
000 Xxxxxxxxx Xxxxxx XX0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxx Xxxxxxxx
Telephone: 000.000.0000
Telecopier: 404.827.6270
87
GUARANTY FEDERAL BANK, F.S.B.
By: /s/ XXXXXXXX X. XXX
-----------------------------------------
XXXXXXXX X. XXX, VICE PRESIDENT
-----------------------------------------
Printed Name and Title
Address:
Guaranty Federal Bank, F.S.B.
0000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxxx Xxx
Telephone: 000.000.0000
Telecopier: 214.360.1661
88
KBC BANK N.V.
By: /s/ XXXXXX XXXXXXXX
-----------------------------------------
XXXXXX XXXXXXXX
FIRST VICE PRESIDENT
-----------------------------------------
Printed Name and Title
By: /s/ XXXXXXX X. XXXXXX
-----------------------------------------
XXXXXXX X. XXXXXX
VICE PRESIDENT
REAL ESTATE
-----------------------------------------
Printed Name and Title
Address:
KBC Bank N.V.
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx XxXxxxx
Vice President
Telephone: 000.000.0000
Telecopier: 213.629.5801
89
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By: /s/ XXXXXXX X. XXXXXXXX
-----------------------------------------
XXXXXXX X. XXXXXXXX
JOINT GENERAL MANAGER
-----------------------------------------
Printed Name and Title
Address:
The Industrial Bank of Japan, Limited
Los Angeles Agency
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xx. Xxxxxxx Xxxx
Vice President
Telephone: 000.000.0000
Telecopier: 213.488.9840
90
CITICORP USA, INC.
By: /s/ XXXXX X. XXXXXXXX
-----------------------------------------
XXXXX X. XXXXXXXX, VICE PRESIDENT
-----------------------------------------
Printed Name and Title
Address:
Citicorp USA, Inc.
c/o Xxxxxxx Xxxxx Xxxxxx, Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxx
Vice President
Telephone: 000.000.0000
Telecopier: 212.723.8547
91
EXHIBIT A
COMMITMENT ASSIGNMENT AND ACCEPTANCE
THIS COMMITMENT ASSIGNMENT AND ACCEPTANCE ("Agreement") dated as
of _________ is made with reference to that certain 2000 Term Loan Agreement,
dated as of October 3, 2000 (the "Loan Agreement") among KBHC, the Banks party
thereto, Credit Lyonnais Los Angeles Branch, as Syndication Agent, Bank One, NA,
as Documentation Agent, and Bank of America, N.A. as Administrative Agent, and
is entered into between the "Assignor" described below, in its capacity as a
Bank under the Loan Agreement, and the "Assignee" described below. Assignor and
Assignee hereby represent, warrant and agree as follows:
1. Definitions. Capitalized terms defined in the Loan Agreement are used
herein with the meanings set forth for such terms in the Loan Agreement. As used
in this Agreement, the following capitalized terms shall have the meanings set
forth below:
"Assignee" means ____________________________.
"Assigned Pro Rata Share" means ______% of the Commitment of the
Banks under the Loan Agreement, being equal to the following dollar amount:
$________.
"Assignor" or" means ____________________________.
"Effective Date" means ____________, the effective date of this
Agreement determined in accordance with Section 11.8 of the Loan Agreement.
"KBHC" means Xxxxxxx and Broad Home Corporation, a Delaware
corporation, and its successors.
2. Representations and Warranties of the Assignor. The Assignor
represents and warrants, as of the date hereof, as follows:
(a) The Pro Rata Share of the Assignor is ______% of the
Commitment (without giving effect to assignments thereof which have not yet
become effective). The Assignor is the legal and beneficial owner of the
Assigned Pro Rata Share and the Assigned Pro Rata Share is free and clear of any
adverse claim.
(b) The outstanding principal balance of Advances made by Assignor
under the Commitment is $_________.
(c) The Assignor has full power and authority, and has taken all
action necessary to execute and deliver this Agreement and any and all other
documents required or permitted to be executed or delivered by it in connection
with this Agreement and to fulfill its obligations under, and to consummate the
transactions contemplated by, this Agreement, and no governmental authorizations
or other authorizations are required in connection therewith.
(d) This Agreement constitutes the legal, valid and binding
obligation of the Assignor.
(Exhibit A, Page 1 of 7)
92
Assignor makes no representation or warranty and assumes no responsibility with
respect to the financial condition of KBHC or the performance by KBHC of its
obligations under the Loan Agreement, and assumes no responsibility with respect
to any statements, warranties or representations made or in connection with the
Loan Agreement or the execution, legality, validity, enforceability, genuineness
or sufficiency of the Loan Agreement or any Loan Document other than as
expressly set forth above.
3. Representations and Warranties of the Assignee. The Assignee hereby
represents and warrants to the Assignor as follows:
(a) The Assignee is an Eligible Assignee;
(b) The Assignee has full power and authority, and has taken all
action necessary to execute and deliver this Agreement, and any and all other
documents required or permitted to be executed or delivered by it in connection
with this Agreement and to fulfill its obligations under, and to consummate the
transactions contemplated by, this Agreement, and no governmental authorizations
or other authorizations are required in connection therewith;
(c) This Agreement constitutes the legal, valid and binding
obligation of the Assignee;
(d) The Assignee has independently and without reliance upon the
Assignor and based on such information as the Assignee has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Assignee
will, independently and without reliance upon the Administrative Agent or any
Bank, 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 the Loan Agreement;
(e) The Assignee has received copies of the Loan Agreement and
such of the Loan Documents as it has requested, together with copies of the most
recent financial statements delivered pursuant to the Loan Agreement; and
(f) If Assignee is organized under the Laws of a jurisdiction
outside the United States of America, attached hereto are the forms prescribed
by the Code and the Loan Agreement certifying Assignee's exemption from United
States withholding taxes with respect to all payments to be made to Assignee
under the Loan Agreement.
4. Assignment. On the terms set forth herein, Assignor, as of the
Effective Date, hereby irrevocably sells, assigns and transfers to the Assignee
all of the rights and obligations of the Assignor under the Loan Agreement and
the other Loan Documents, in each case to the extent of the Assigned Pro Rata
Share, and the Assignee irrevocably accepts such assignment of rights and
assumes such obligations from the Assignor on such terms and as of the Effective
Date. As of the Effective Date, Assignee shall have the rights and obligations
of a "Bank" (as defined in the Loan Agreement) under the Loan Documents, except
to the extent of any arrangements with respect to payments referred to in
Section 5 hereof. Assignee hereby appoints and authorizes the Administrative
Agent to take such action and to exercise such powers as are delegated to the
Administrative Agent by the Loan Agreement.
5. Payment. On the Effective Date, Assignee shall pay to the Assignor, in
immediately available funds, an amount equal to the purchase price, as agreed
between the Assignor and the Assignee, of the Assigned Pro Rata Share. The
Assignor and the Assignee have entered into a letter
(Exhibit A, Page 2 of 7)
93
agreement, of even date herewith, which sets forth their agreement with respect
to the amount of interest, fees, and other payments with respect to the Assigned
Pro Rata Share which are to be retained by the Assignor.
The Assignor and the Assignee hereby agree that if either receives
any payment of interest, principal, fees or any other amount under the Loan
Agreement, their respective Notes and other Loan Documents which is for the
account of the other, it shall hold the same in trust for such party to the
extent of such party's interest therein and shall promptly pay the same to such
party.
6. Principal. Interest. Fees, etc. Any principal that would be payable
and any interest, fees and other amounts that would accrue from and after the
Effective Date to or for the account of the Assignor pursuant to the Loan
Agreement and the Notes shall be payable to or for the account of the Assignor
and the Assignee, in accordance with their respective interests as adjusted
pursuant to this Agreement.
7. Notes. The Assignor and Assignee shall make appropriate arrangements
with KBHC concurrently with the execution and delivery hereof so that a
replacement Note is issued to the Assignor, if necessary, and a new Note is
issued to the Assignee in principal amounts reflecting their Pro Rata Shares of
the Commitment or their outstanding Advances (as adjusted pursuant to this
Agreement). As of the Effective Date, the Pro Rata Shares of Assignor and
Assignee to be reflected on Schedule 1.1 to the Loan Agreement shall be:
Pro Rata Share of
Commitment
-----------------
Assignor __% ($ ________)
Assignee __% ($ ________)
8. Further Assurances. Concurrently with the execution of this Agreement,
Assignor shall execute four counterpart original Requests for Registration, in
the form of Exhibit A to this Agreement, to be forwarded to the Administrative
Agent. The Assignor and the Assignee further agree to execute and deliver such
other instruments, and take such other action, as either party may reasonably
request in connection with the transactions contemplated by this Agreement, and
Assignor specifically agrees to cause the delivery of (i) four original
counterparts of this Agreement and (ii) the Requests for Registration, to the
Administrative Agent for the purpose of registration of Assignee as a "Bank"
pursuant to the Loan Agreement.
9. GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACTUAL
OBLIGATION UNDER, AND SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA.
10. Notices. All communications among the parties or notices in
connection herewith shall be in writing, hand delivered or sent by registered
airmail, postage prepaid, or by telex, telegram or cable, addressed to the
appropriate party at its address set forth on the signature pages hereof. All
such communications and notices shall be effective upon receipt.
(Exhibit A, Page 3 of 7)
94
11. Binding Effect. This Agreement shall become effective upon the
execution of the Request for Registration in the form of Exhibit A to this
Agreement by KBHC and the execution of the Consent in the form of Exhibit B to
this Agreement by the Administrative Agent, and shall be binding upon and inure
to the benefit of the parties and their respective successors and assigns;
provided, however, that Assignee shall not assign its rights or obligations
without the prior written consent of the Assignor and any purported assignment,
absent such consent, shall be void.
12. Interpretation. The headings of the various sections hereof are for
convenience of reference only and shall not affect the meaning or construction
of any provision hereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officials, officers or agents
thereunto duly authorized as of the date first above written.
"Assignor"
---------------------------------------------
By:
------------------------------------------
------------------------------------------
Printed Name and Title
Address:
----------------------------------
----------------------------------
----------------------------------
Attn:
-----------------------------
"Assignee"
---------------------------------------------
By:
------------------------------------------
------------------------------------------
Printed Name and Title
Address:
----------------------------------
----------------------------------
----------------------------------
Attn:
-----------------------------
(Exhibit A, Page 4 of 7)
95
Exhibit A to Commitment Assignment and Acceptance
REQUEST FOR REGISTRATION
TO: BANK OF AMERICA, N.A., as Administrative Agent
THIS REQUEST FOR REGISTRATION OF ASSIGNEE is made as of the date
of the enclosed Commitment Assignment and Acceptance with reference to that
certain 2000 Term Loan Agreement dated as of October 3, 2000 among KBHC, the
Banks who are parties thereto, Bank of America, N.A., as Administrative Agent,
Credit Lyonnais Los Angeles Branch, as Syndication Agent, and Bank One, NA, as
Documentation Agent.
Assignor and Assignee hereby request that the Administrative Agent
approve of Assignee as a Bank, and that the Administrative Agent register
Assignee as a Bank pursuant to the Loan Agreement effective as of the Effective
Date described in the enclosed Commitment Assignment and Acceptance and, in
connection with this request certify to the Administrative Agent that the
enclosed Commitment Assignment and Acceptance sets forth the correct Commitment
and the Assigned Pro Rata Share of the Assignee.
Enclosed with this Request are four counterpart originals of the
Commitment Assignment and Acceptance as well as the original Note issued to
Assignor.
IN WITNESS WHEREOF, Assignor and Assignee have executed this
Request for Registration by their duly authorized officers as of ___________.
"Assignor"
---------------------------------------------
By:
------------------------------------------
------------------------------------------
Printed Name and Title
Exhibit A
Page 1 of 2
(Exhibit A, Page 5 of 7)
96
"Assignee"
---------------------------------------------
By:
------------------------------------------
------------------------------------------
Printed Name and Title
THE UNDERSIGNED HEREBY CONSENTS
TO THE ABOVE ASSIGNMENT:
XXXXXXX AND BROAD HOME CORPORATION,
a Delaware corporation
By:
-----------------------------
-----------------------------
Printed Name and Title
Exhibit A
Page 2 of 2
(Exhibit A, Page 6 of 7)
97
Exhibit B to Commitment Assignment and Acceptance
CONSENT
TO: THE ASSIGNOR AND ASSIGNEE REFERRED TO IN THE ABOVE REQUEST FOR
REGISTRATION
When countersigned by the Administrative Agent below, this document shall
certify that:
1. The Administrative Agent has consented, pursuant to the terms of the
Loan Documents, to the assignment by Assignor to Assignee of the Assigned Pro
Rata Share.
2. The Administrative Agent has registered Assignee as a Bank under the
Loan Agreement, effective as of the Effective Date described above, with a Pro
Rata Share of the Commitment corresponding to the Assigned Pro Rata Share and
has adjusted the registered Pro Rata Share of the Commitment of Assignor to
reflect the assignment of the Assigned Pro Rata Share.
BANK OF AMERICA, N.A., as Administrative Agent
By:
--------------------------------------------
--------------------------------------------
Printed Name and Title
Exhibit B
Page 1 of 1
(Exhibit A, Page 7 of 7)
98
EXHIBIT B
COMPLIANCE CERTIFICATE AS REQUIRED BY ARTICLE 7, SECTION 2
ARTICLE 6.9 - CONSOLIDATED TANGIBLE NET WORTH
11/30/1999A 2/28/00A 5/31/00A 8/31/00E 11/30/00E 2/28/01E 5/31/01E 8/31/01E 11/30/01E
-----------------------------------------------------------------------------------------------
$000 $000 $000 $000 $000 $000 $000 $000 $000
Consolidated Net Income
(commencing 06/01/00)
50% cumulative Consolidated
Net Income
proceeds from issuance
capital stock (after 10/06/00)
50% cumulative proceeds
issuance capital stock
6.9 MINIMUM CONSOLIDATED
TANGIBLE NET WORTH
=============================
(a) Base Amount 575 575 575 575 575 575 575 575 575
(b) Plus 50% of cumulative
Consolidated Net Income
(c) Plus - 50% cumulative
proceeds from issuance
of capital stock
(d) Plus - 50% of proceeds
Feline Prides after
10/6/00
(e) Stock Repurchase
Stepdown
Stock Repurchase
Cap
Actual Stock
Repurchase
Stepdown (70) (50) (50) (20) (20) (20)
------------------------------------------------------------------------------------------------
MINIMUM CONSOLIDATED
TANGIBLE NET WORTH 575 575 575 575 575 575 575 575 575
------------------------------------------------------------------------------------------------
1.1 "CONSOLIDATED TANGIBLE
NET WORTH"
=============================
Consolidated Share-
holder's Equity
Plus - Feline Prides
book value
goodwill since
11/30/96
/Plus any
cumulative foreign
currency translation
adjustment
------------------------------------------------------------------------------------------------
CONSOLIDATED TANGIBLE
NET WORTH 0 0 0 0 0 0 0 0 0
------------------------------------------------------------------------------------------------
CTNW Min CTNW (575) (575) (575) (575) (575) (575) (575) (575) (575)
================================================================================================
Xxxxxxx & Broad Confidential Page 1
10/5/2000
99
EXHIBIT C
NOTE
$_______________ October ___, 2000
Los Angeles, California
FOR VALUE RECEIVED, the undersigned promises to pay to the order
of ___________________________________("the Bank") the principal amount of
__________________________DOLLARS ($__________), or such lesser aggregate amount
of Advances as may be made pursuant to the Bank's Pro Rata Share of the
Commitment under the 2000 Revolving Loan Agreement hereinafter described,
payable as hereinafter set forth. The undersigned promises to pay interest on
the principal amount of each Advance made hereunder and remaining unpaid from
time to time from the date of each such Advance until the date of payment in
full, payable as hereinafter set forth.
Reference is made to the 2000 Revolving Loan Agreement dated as of
October 3, 2000 among the undersigned, as Borrower, the Banks that are parties
thereto, Bank of America, N.A., as Administrative Agent, Credit Lyonnais Los
Angeles Branch, as Syndication Agent, and Bank One, NA, as Documentation Agent
(as amended from time to time, the "Loan Agreement"). Terms defined in the Loan
Agreement and not otherwise defined herein are used herein with the meanings
defined for those terms in the Loan Agreement. This is one of the Notes referred
to in the Loan Agreement, and any holder hereof is entitled to all of the
rights, remedies, benefits and privileges provided for in the Loan Agreement as
originally executed or as it may from time to time be supplemented, modified,
amended, renewed, extended or supplanted. The Loan Agreement, among other
things, contains provisions for acceleration of the maturity hereof upon the
happening of certain stated events upon the terms and conditions therein
specified.
The principal indebtedness evidenced by this Note shall be payable
as provided in the Loan Agreement and in any event on the Maturity Date.
Interest shall be payable on the outstanding daily unpaid
principal amount of each Advance hereunder from the date thereof until payment
in full and shall accrue and be payable at the rates and on the dates set forth
in the Loan Agreement to the fullest extent permitted by applicable Law, before
and after default, before and after maturity and before and after any judgment,
with interest on overdue interest to bear interest at the rate set forth in
Section 3.8 of the Loan Agreement.
The amount of each payment hereunder shall be made to the
Administrative Agent at the Administrative Agent's Office, for the account of
the Bank, in lawful money of the United States of America, without deduction,
offset or counterclaim and in immediately available funds on the day of payment
(which must be a Banking Day). All payments of principal received after 10:00
a.m., Los Angeles time, on any Banking Day, shall be deemed received on the next
succeeding Banking Day for purposes of calculating interest thereon. The Bank
shall use its best efforts to keep a record of
(Exhibit C, Page 1 of 4)
100
Advances made by it and payments of principal with respect to this Note, and
such record shall be presumptive evidence of the principal amount owing under
this Note.
The undersigned hereby promises to pay, within thirty (30) days
after demand, the reasonable costs and expenses of any holder hereof incurred in
collecting the undersigned's obligations hereunder or in enforcing or attempting
to enforce any of any holder's rights hereunder, including attorneys' fees and
disbursements, whether or not an action is filed in connection therewith, in
accordance with Section 11.3 of the Loan Agreement.
The undersigned hereby waives presentment, demand for payment,
dishonor, notice of dishonor, protest, notice of protest and any other notice or
formality, to the fullest extent permitted by applicable Laws.
This Note shall be delivered to and accepted by the Bank in the
State of California, and shall be governed by, and construed and enforced in
accordance with, the local Laws thereof.
XXXXXXX AND BROAD HOME CORPORATION,
a Delaware corporation
By
-------------------------------------------
Xxxxx X. Xxxxxx
Vice President and Treasurer
(Exhibit C, Page 2 of 4)
101
ADVANCES AND PAYMENTS OF PRINCIPAL
(Prime Rate Loans)
-------------------------------------------------------------------------------------------------
Amount of Loan or Amount of Principal
of Redesignation Paid or Redesignated
From Another Type Into Another Type of Unpaid Principal Notation
Date of Loan Loan Balance Made By
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
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(Exhibit C, Page 3 of 4)
102
ADVANCES AND PAYMENTS OF PRINCIPAL
(LIBOR Loans)
-----------------------------------------------------------------------------------------------------------------
Amount of Loan or Amount of Principal
of Redesignation Paid or Redesignated
From Another Type Into Another Type of Unpaid Principal Notation
Date of Loan Loan Balance Made By
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
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(Exhibit C, Page 4 of 4)
103
EXHIBIT D-1
[XXXXXXX & BROAD LOGO]
October 6, 2000
To: Bank of America, N.A.,
as Administrative Agent
The Banks That Are Party to the Term Loan Agreement
Referred to Below
Re: Xxxxxxx and Broad Home Corporation
Ladies and Gentlemen:
I am Senior Vice President and General Counsel of Xxxxxxx and
Broad Home Corporation, a Delaware corporation ("Borrower"). I have acted as
such in connection with the 2000 Term Loan Agreement (the "Term Loan Agreement")
dated as of October 3, 2000, by and among Borrower; the Banks which are parties
thereto; Bank of America, N.A., as Administrative Agent; Credit Lyonnais Los
Angeles Branch, as Syndication Agent; Bank One, NA, as Documentation Agent; and
Banc of America Securities LLC as Lead Arranger and Sole Book Manager (all such
parties other than Borrower are collectively referred to herein as "Bank
Parties").
This Opinion is furnished to you pursuant to Section 8.1(a)(v) of
the Term Loan Agreement. Capitalized terms not otherwise defined herein shall
have the meanings ascribed to them in the Term Loan Agreement.
For the purposes of this opinion, I have examined originals, or
copies identified to my satisfaction as being true copies, of the following
documents:
(a) the Term Loan Agreement;
104
Page 2
(b) the Notes of even date herewith;
(c) the Subsidiary Guaranty; and
(d) the letters executed and delivered between the Administrative
Agent and Borrower, dated as of October 3, 2000, which concern agency fees and,
upfront fees.
The documents described in (a) through (d) above are sometimes
referred to herein as the "Loan Documents".
I have also made such investigations of fact and law, obtained
such certificates from public officials, Responsible Officials of Borrower and
certain of its Subsidiaries, reviewed incorporation and partnership
documentation, resolutions, secretary's certificates, good standing certificates
and other documents as appropriate of and for the Borrower and the Guarantor
Subsidiaries, as applicable, and done such other things as I have deemed
necessary for the purpose of this Opinion.
I have assumed (i) that all natural persons have legal capacity,
(ii) the genuineness of all signatures of all parties other than Borrower and
its Guarantor Subsidiaries, (iii) the conformity to authentic original documents
of all documents submitted to me as copies and the authenticity of all documents
submitted to me as originals, (iv) as to all parties other than Borrower and its
Guarantor Subsidiaries, the due authorization, execution and delivery of the
Loan Documents, (v) that each of the Bank Parties has full power, authority and
legal right, under its charter and other governing documents and laws applicable
to it to perform its respective obligations thereunder, (vi) that all parties to
any Loan Document have filed all required franchise tax returns, if any, and
paid all required taxes, if any, under the California Revenue & Taxation Code
and under the laws of the State of Delaware and the respective states of
incorporation or formation of the Guarantor Subsidiaries, (vii) that each of the
Bank Parties has the requisite power and authority, has obtained all necessary
consents, licenses and permits, has taken all necessary action and has complied
with any and all applicable laws with which such Bank Party is required to
comply, in each case relating to or affecting the matters and actions
contemplated by the Loan Documents, (viii) that each of the Bank Parties (other
than Banc of America Securities LLC) is a national bank, state bank or similar
financial institution and is an exempt lender under Article XV of the California
Constitution or statutes enacted pursuant thereto and (ix) that the Loan
Documents have not been modified, amended, terminated or revoked in any respect,
and remain in full force and effect as of the date hereof.
With respect to those opinions expressed below to be to "knowledge" or
"to the knowledge of the undersigned," or similar such wording, I am referring
solely to my individual, actual knowledge. Except as expressly set forth herein,
I did not undertake a review or examination of the activities or business
records of Borrower or any Subsidiaries specifically for the purpose of
rendering this opinion or to determine the existence or absence of such facts.
As Senior Vice President and General Counsel of Borrower, however, material
information respecting the matters covered by such opinions is brought to my
attention on a regular basis as a matter of internal policy and I intend the
phrase "to the knowledge of the undersigned" to mean
105
Page 3
that, in reviewing such information, nothing has come to my attention which
caused or should have caused me not to render such opinions.
On the basis of the foregoing, and relying thereon, and with the
qualifications herein set forth, I am of the opinion that:
1. Borrower is a corporation duly organized, validly existing and
in good standing under the Laws of the State of Delaware, and its certificate of
incorporation does not provide for the termination of its existence. Borrower is
duly qualified or registered to transact business and is in good standing as a
foreign corporation in the State of California and each other jurisdiction in
which the conduct of its business or the ownership of its Properties makes such
qualifications or registration necessary, except where the failure so to qualify
or register and to be in good standing would not constitute a Material Adverse
Effect.
2. Borrower has all requisite corporate power and authority to
conduct its business, to own and lease its Properties and to execute, deliver
and perform all of its Obligations under the Loan Documents to which it is a
Party.
3. To the knowledge of the undersigned, Borrower is in substantial
compliance with all Laws and other legal requirements applicable to its
business, has obtained all authorizations, consents, approvals, orders, licenses
and permits from, and has accomplished all filings, registrations and
qualifications with, or obtained exemptions from any of the foregoing from, any
Government Agency that are necessary for the transaction of its business, except
where the failure so to comply, file, register, qualify, or obtain exemptions
would not constitute a Material Adverse Effect.
4. The execution, delivery and performance by Borrower and by each
Guarantor Subsidiary of each of the Loan Documents to which they are a Party
have been duly authorized by all necessary corporate action, and do not:
a. require under the charter documents of Borrower or any
Guarantor Subsidiary any consent or approval not heretofore
obtained of any partner, director, stockholder, security holder,
or creditor of such Party;
b. violate or conflict with the Party's charter,
certificate or articles of incorporation, or bylaws;
c. to the knowledge of the undersigned, result in or
require the creation or imposition of any Lien or Right of Others
(other than as provided under the Loan Documents) upon or with
respect to any Property now owned or leased by such Party;
d. violate any Requirement of Law known to the undersigned
to be applicable to such Party; or
106
Page 4
e. result in a breach of or constitute a default under, or
cause or permit the acceleration of any obligation owed under, any
indenture or loan or credit agreement known to the undersigned or
any other Contractual Obligation known to the undersigned to which
such Party is a party or by which such Party or any of its
Property is bound or affected;
and, to the knowledge of the undersigned, neither Borrower nor any Subsidiary of
Borrower is in violation of, or default under, any Requirement of Law or
contractual obligation, or any indenture, loan, or credit agreement described in
subparagraph (e) above in any respect that would constitute a Material Adverse
Effect.
5. The Loan Documents to which either Borrower or any Guarantor
Subsidiary is Party have each been validly executed and delivered to the
Administrative Agent by Borrower or such Guarantor Subsidiary, as the case may
be, and constitute the legal, valid and binding obligation of Borrower or such
Guarantor Subsidiary, as the case may be, enforceable against such Borrower or
such Guarantor Subsidiary, as the case may be, in accordance with its terms.
6. Except as have heretofore been obtained, no authorization,
consent, approval, order, license or permit from, or filing, registration or
qualification with, or exemption from any of the foregoing from, any
Governmental Agency under any Requirement of Law imposed on Borrower or any
Guarantor Subsidiary by the laws of the United States of America or the State of
California, in each case as the same exists on the date hereof, is or will be
required to authorize or permit the execution, delivery and performance by
Borrower or by any Significant Subsidiary of the Loan Documents to which it is a
Party.
7. Each Significant Subsidiary which is a Domestic Subsidiary is a
legal entity of the form described for that Subsidiary in Schedule 4.4 to the
Agreement, duly organized, validly existing and in good standing under the Laws
of its jurisdiction of formation, is duly qualified or registered to do business
as a foreign organization (if applicable) and is in good standing as such in
each jurisdiction in which the conduct of its business or the ownership or
leasing of its Properties makes such qualifications or registration necessary
(except where the failure to be so qualified or registered and in good standing
does not constitute a Material Adverse Effect) and has all requisite power and
authority to conduct its business and to own and lease its Properties and to
execute, deliver and perform the obligations under the Loan Documents to which
it is a Party.
8. To the knowledge of the undersigned, each Significant
Subsidiary is in substantial compliance with all Laws and other requirements
applicable to its business, has obtained all authorizations, consents,
approvals, orders, licenses and permits from and has accomplished all filings,
registrations and qualifications with, or obtained exemptions from any of the
foregoing from, any Governmental Agency that are necessary for the transaction
of its business, except where the failure so to comply, file, register, qualify
or obtain exemptions does not constitute a Material Adverse Effect.
107
Page 5
9. Neither Borrower nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act, or the Investment Company Act of 1940.
10. To the knowledge of the undersigned, there are no actions,
suits or proceedings pending or threatened against or affecting Borrower or any
of its Subsidiaries or any Property of any of them in any court of Law or before
any Governmental Agency in which there is a reasonable probability of a decision
that would constitute a Material Adverse Effect.
11. Neither Borrower nor any of its Subsidiaries is 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" or
"margin security" within the meanings of Regulation U of the Board of Governors
of the Federal Reserve System, and no loan under the Agreement will be used to
purchase or carry any such margin stock in violation of Regulation U.
12. To the knowledge of the undersigned, Borrower and its
Subsidiaries are in substantial compliance with all applicable Laws relating to
environmental protection where the failure to comply would constitute a Material
Adverse Effect and have not received any notice from any Governmental Agency
respecting the alleged violation by Borrower or any Subsidiary of such Laws
which would constitute a Material Adverse Effect which has not been or is not
being corrected.
In addition to any assumptions, qualifications and other matters
set forth elsewhere herein, the opinions set forth above are subject to the
following:
(a) My opinion with respect to the legality, validity, binding
effect and enforceability of any Loan Document, agreement, or provision is
subject to the effect of any applicable bankruptcy, insolvency, fraudulent
conveyance, fraudulent transfer and equitable subordination, reorganization,
moratorium, or similar law affecting creditors' rights generally and to the
effect of general principles of equity, including (without limitation) concepts
of materiality, reasonableness, estoppel, good faith and fair dealing
(regardless of whether considered in a proceeding in equity or at law). I
express no opinion as to the availability of equitable remedies. In applying
such equitable principles, a court, among other things, might not allow a
creditor to accelerate the maturity of a debt or enforce a guaranty thereof upon
the occurrence of a default deemed immaterial or for non-credit reasons or might
decline to order a debtor to perform covenants. Such principles applied by a
court might also include a requirement that a creditor act with reasonableness
and in good faith.
(b) Certain rights, remedies and waivers of the Loan Documents may
be unenforceable in whole or in part, but the inclusion of such provisions does
not affect the validity of the Loan Documents taken as a whole and, except as
set forth in subparagraph (a) above, the Loan Documents taken as a whole contain
adequate provisions for enforcing payment of the Obligations; however, the
unenforceability of such provisions may result in delays in or limitations on
the enforcement of the parties' rights and remedies under the Loan Documents
(and I express no opinion as to the economic consequences, if any, of such
delays or limitations).
108
Page 6
(c) I call your attention to the following matters on which I
express no opinion:
(i) the agreements in the Loan Documents to indemnify the
Bank Parties against costs or expenses or liability notwithstanding such
parties' acts of negligence or willful misconduct;
(ii) provisions in the Loan Documents for payment or
reimbursement of costs, fees and expenses or indemnification for claims,
losses, or liabilities to the extent any such provision may be determined
by a court or other tribunal to be in an unreasonable amount, to
constitute a penalty, or to be contrary to public policy;
(iii) the agreements in the Loan Documents to the
jurisdiction or venue of a particular court, to the waiver of the right
to jury trial, or to be served with process by service upon a designated
third party;
(iv) any of the waivers or remedies contained in the Loan
Documents, whether or not any Loan Document deems any such waiver or
remedy commercially reasonable, if such waivers or remedies are
determined (1) not to be commercially reasonable under applicable law,
(2) to conflict with mandatory provisions of applicable law, (3) to be
taken in a manner determined to be unreasonable or not performed in good
faith or with fair dealing or with honesty in fact, or (4) to be broadly
or vaguely stated or not to describe the right or duty purportedly waived
with reasonable specificity;
(v) provisions in the Loan Documents which may be construed
as imposing penalties or forfeitures, late payment charges, or an
increase in interest rate, upon delinquency in payment or the occurrence
of a default;
(vi) any power of attorney granted under the Loan
Documents;
(vii) provisions in the Loan Documents to the effect that
rights or remedies are not exclusive, that every right or remedy is
cumulative and may be exercised in addition to any other right or remedy,
that the election of some particular remedy does not preclude recourse to
one or more others, or that failure to exercise or a delay in exercising
rights or remedies will not operate as a waiver of any such right or
remedy;
(viii) provisions in the Loan Documents which expressly or
by implication waive or limit the benefits of statutory, regulatory, or
109
Page 7
constitutional rights, unless and to the extent the statute, regulation,
or constitution explicitly allow such waiver or other limitation;
(ix) the effect of Section 1698 of the California Civil
Code which, among other matters, provides that a written contract may be
modified by an oral agreement to the extent such agreement is performed
by the parties;
(x) the effect of Section 1670.5 of the California Civil
Code which provides that a court may not enforce or may limit the
application of a contract or portions thereof which it finds as a matter
of law to have been unconscionable at the time the contract was made;
(xi) the effect of any Bank Party's compliance or
noncompliance with any state or federal laws or regulations applicable to
it or applicable to the transactions contemplated by the Loan Documents
due to the nature of such Bank Party's business;
(xii) the effect of (1) any modification or alteration of
the Loan Documents or other agreements with Borrower affecting the
obligations of Borrower, (2) an election of remedies by the Bank Parties,
or (3) any other action by the Bank Parties that materially prejudices
any Guarantor Subsidiary if such modification, election, or action occurs
without notice to the Guarantor Subsidiaries and without giving the
Guarantor Subsidiaries an opportunity to cure any default by Borrower;
(xiii) the enforceability of any provision in the Loan
Documents which provide that such Loan Documents may only be modified in
writing; and
(xiv) the validity and enforceability of covenants set
forth in the Loan Documents which purport to survive the repayment of the
indebtedness evidenced therein.
My opinions expressed herein are limited to the laws of the State
of California, the General Corporation Law of the State of Delaware and the
federal laws of the United States of America, and I do not express any opinion
herein concerning any other law, including, but not limited to, ordinances,
regulations or practices of any county, city, or other government agency or body
within the State of California.
This Opinion is being provided in connection with the transaction
referred to above and may not be relied upon (x) by any person other than the
Bank Parties, an Eligible Assignee, or any successor in interest of any Bank
Party or (y) by the Bank Parties, an Eligible Assignee, or any successor in
interest of any Bank Party in any other context. This Opinion is being provided
in connection with the transaction referred to above and may not be relied upon
110
Page 8
by any person other than the Bank Parties or by the Bank Parties in any other
context. Copies hereof may be furnished (a) to your independent auditors and
attorneys, (b) to any governmental agency or authority having regulatory
jurisdiction over you, (c) pursuant to an order of legal process of any court or
of any governmental agency or authority, or (d) in connection with any legal
action to which you are a party arising out of the transaction referred to
above. This opinion is rendered as of the date hereof, and I hereby disclaim any
obligation to advise any person entitled to rely hereon of any change in the
matters stated herein.
Very truly yours,
/s/ XXXXXX X. XXXXXXX
Xxxxxx X. Xxxxxxx
Senior Vice President and General Counsel
Xxxxxxx and Broad Home Corporation
111
EXHIBIT D-2
[XXXXXX, XXXXXX & XXXXX LLP LETTERHEAD]
October 6, 2000 WRITER'S DIRECT LINE
To: Bank of America, N.A.,
as Administrative Agent
The Banks That Are Party to the Term Loan Agreement
Referred to Below
Re: Xxxxxxx and Broad Home Corporation
Ladies and Gentlemen:
We have acted as counsel to Xxxxxxx and Broad Home Corporation, a
Delaware corporation (the "Borrower"), in connection with the 2000 Term Loan
Agreement (the "Term Loan Agreement") dated as of October 3, 2000, by and among
Borrower; the Banks which are parties thereto; Bank of America, N.A., as
Administrative Agent; Credit Lyonnais Los Angeles Branch, as Syndication Agent;
Bank One, NA, as Documentation Agent; and Banc of America Securities LLC, as
Lead Arranger and Sole Book Manager (all such parties other than Borrower are
collectively referred to herein as "Bank Parties").
This Opinion is furnished to you pursuant to Section 8.1(a)(v) of
the Term Loan Agreement. Capitalized terms not otherwise defined herein shall
have the meanings ascribed to them in the Term Loan Agreement.
For the purposes of this opinion, we have examined originals, or
copies identified to our satisfaction as being true copies, of the following
documents:
(a) the Term Loan Agreement;
112
XXXXXX, XXXXXX & XXXXX LLP
Bank of America, N.A.
October 6, 2000
Page 2
(b) the Notes of even date herewith;
(c) the Subsidiary Guaranty; and
(d) the letters executed and delivered between the Administrative
Agent and Borrower, dated as of October 3, 2000, which concern agency fees and
upfront fees.
The documents described in (a) through (d) above are sometimes
referred to herein as the "Loan Documents".
We have also examined such other corporate documents and records,
and other certificates, opinions and instruments and have conducted such
investigations as we have deemed necessary as a basis for the opinions expressed
below. As to factual matters relevant to our opinions expressed below, we have,
without independent investigation, relied upon certificates from public
officials and from Borrower's officers and upon public records, and have further
assumed and relied upon, without independent investigation, the truth and
accuracy of all factual representations and warranties of all parties to the
Loan Documents.
We have assumed (i) that all natural persons have legal capacity,
(ii) the genuineness of all signatures of all parties other than Borrower, (iii)
the conformity to authentic original documents of all documents submitted to us
as copies and the authenticity of all documents submitted to us as originals,
(iv) that each of the Guarantor Subsidiaries is duly organized, validly existing
and in good standing under the laws of its jurisdiction of incorporation or
organization and in each other jurisdiction where the conduct of its business or
the ownership of its Properties makes qualification or registration to transact
business necessary, (v) as to all parties other than Borrower, the due
authorization, execution and delivery of the Loan Documents, (vi) the validity
and enforceability of the Loan Documents against all parties thereto other than
Borrower and the Guarantor Subsidiaries, (vii) that each of the Bank Parties has
the requisite power and authority, has obtained all necessary consents, licenses
and permits, has taken all necessary action and has complied with any and all
applicable laws with which such Bank Party is required to comply, in each case
relating to or affecting the matters and actions contemplated by the Loan
Documents, (viii) that each of the Bank Parties (other than Banc of America
Securities LLC) is a national bank, state bank or similar financial institution
and is an exempt lender under Article XV of the California Constitution or
statutes enacted pursuant thereto, (ix) that the Loan Documents have not been
modified, amended, terminated or revoked in any respect, and remain in full
force and effect as of the date hereof and (x) that the parties to the Loan
Documents are not subject to any special laws, regulations or restrictions that
are not generally applicable to parties participating in transactions of the
type contemplated by the Loan Documents and that would affect the validity,
binding effect or enforceability of the Loan Documents or the performance by
such parties of their obligations thereunder.
On the basis of the foregoing, and relying thereon, and with the
qualifications herein set forth, we are of the opinion that:
113
XXXXXX, XXXXXX & XXXXX LLP
Bank of America, N.A.
October 6, 2000
Page 3
1. Borrower is a corporation duly incorporated, validly existing
and in good standing under the General Corporation Law of the State of Delaware,
and its certificate of incorporation does not limit the term of its existence.
2. Borrower has all requisite corporate power and authority to
conduct its business, to own and lease its Properties and to execute, deliver
and perform all of its obligations under the Loan Documents to which it is a
party.
3. The execution, delivery and performance by Borrower of the Loan
Documents to which it is a party have been duly authorized by all necessary
corporate action.
4. The execution, delivery and performance of the Loan Documents
by Borrower do not violate any provision of Borrower's certificate of
incorporation or bylaws, and the execution, delivery and performance by Borrower
and each Guarantor Subsidiary of the Loan Documents to which it is a party do
not violate any Requirement of Law applicable to Borrower or such Guarantor
Subsidiary imposed by the laws of the United States of America or the State of
California that, in our experience, is normally applicable to general business
entities in relation to transactions of the type contemplated by the Loan
Documents.
5. Except as have heretofore been obtained, no authorization,
consent, approval, order, license, or permit from, or filing, registration, or
qualification with, or exemption from any of the foregoing from any Governmental
Agency under any Requirement of Law imposed on Borrower or any Guarantor
Subsidiary by the laws of the United States of America or the State of
California, in each case as such Requirements of Law exist on the date hereof,
is or will be required to authorize or permit the execution, delivery and
performance by Borrower or any Guarantor Subsidiary of the Loan Documents to
which it is a party.
6. Each of the Loan Documents to which Borrower or any Guarantor
Subsidiary is a party will, when executed and delivered by Borrower or such
Guarantor Subsidiary, as the case may be, constitute the legal, valid and
binding obligation of Borrower or such Guarantor Subsidiary, as the case may be,
enforceable against Borrower or such Guarantor Subsidiary, as the case maybe, in
accordance with its terms.
In addition to any assumptions, qualifications and other matters
set forth elsewhere herein, the opinions set forth above are subject to the
following:
(a) Our opinion with respect to the legality, validity, binding
effect and enforceability of any Loan Document, agreement, or provision is
subject to the effect of any applicable bankruptcy, insolvency, fraudulent
conveyance, fraudulent transfer and equitable subordination, reorganization,
moratorium, or similar law affecting creditors' rights generally and to the
effect of general principles of equity, including (without limitation) concepts
of materiality, reasonableness, estoppel, good faith and fair dealing
(regardless of whether considered in a proceeding in equity or at law). We
express no opinion as to the availability of equitable remedies. In applying
such equitable principles, a court, among other things, might not allow a
creditor to accelerate the maturity of a debt or enforce a guaranty thereof upon
the
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Bank of America, N.A.
October 6, 2000
Page 4
occurrence of a default deemed immaterial or for non-credit reasons or might
decline to order a debtor to perform covenants. Such principles applied by a
court might also include a requirement that a creditor act with reasonableness
and in good faith.
(b) Certain rights, remedies and waivers of the Loan Documents may
be unenforceable in whole or in part, but the inclusion of such provisions does
not affect the validity of the Loan Documents taken as a whole and, except as
set forth in subparagraph (a) above, the Loan Documents taken as a whole contain
adequate provisions for enforcing payment of the Obligations; however, the
unenforceability of such provisions may result in delays in or limitations on
the enforcement of the parties' rights and remedies under the Loan Documents
(and we express no opinion as to the economic consequences, if any, of such
delays or limitations).
(c) We call your attention to the following matters on which we
express no opinion:
(i) the agreements in the Loan Documents to indemnify the
Bank Parties against costs or expenses or liability notwithstanding such
parties' acts of negligence or willful misconduct;
(ii) provisions in the Loan Documents for payment or
reimbursement of costs, fees and expenses or indemnification for claims,
losses, or liabilities to the extent any such provision may be determined
by a court or other tribunal to be in an unreasonable amount, to
constitute a penalty, or to be contrary to public policy;
(iii) the agreements in the Loan Documents to the
jurisdiction or venue of a particular court, to the waiver of the right
to jury trial, or to be served with process by service upon a designated
third party;
(iv) any of the waivers or remedies contained in the Loan
Documents, whether or not any Loan Document deems any such waiver or
remedy commercially reasonable, if such waivers or remedies are
determined (1) not to be commercially reasonable under applicable law,
(2) to conflict with mandatory provisions of applicable law, (3) to be
taken in a manner determined to be unreasonable or not performed in good
faith or with fair dealing or with honesty in fact, or (4) to be broadly
or vaguely stated or not to describe the right or duty purportedly waived
with reasonable specificity;
(v) provisions in the Loan Documents which may be construed
as imposing penalties or forfeitures, late payment charges, or an
increase in interest rate, upon delinquency in payment or the occurrence
of a default;
115
XXXXXX, XXXXXX & XXXXX LLP
Bank of America, N.A.
October 6, 2000
Page 5
(vi) any power of attorney granted under the Loan
Documents;
(vii) provisions in the Loan Documents to the effect that
rights or remedies are not exclusive, that every right or remedy is
cumulative and may be exercised in addition to any other right or remedy,
that the election of some particular remedy does not preclude recourse to
one or more others, or that failure to exercise or a delay in exercising
rights or remedies will not operate as a waiver of any such right or
remedy;
(viii) provisions in the Loan Documents which expressly or
by implication waive or limit the benefits of statutory, regulatory, or
constitutional rights, unless and to the extent the statute, regulation,
or constitution explicitly allow such waiver or other limitation;
(ix) the effect of Section 1698 of the California Civil
Code which, among other matters, provides that a written contract may be
modified by an oral agreement to the extent such agreement is performed
by the parties;
(x) the effect of Section 1670.5 of the California Civil
Code which provides that a court may not enforce or may limit the
application of a contract or portions thereof which it finds as a matter
of law to have been unconscionable at the time the contract was made;
(xi) the effect of any Bank Party's compliance or
noncompliance with any state or federal laws or regulations applicable to
it or applicable to the transactions contemplated by the Loan Documents
due to the nature of such Bank Party's business;
(xii) the effect of (1) any modification or alteration of
the Loan Documents or other agreements with Borrower affecting the
obligations of Borrower, (2) an election of remedies by the Bank Parties,
or (3) any other action by the Bank Parties that materially prejudices
any Guarantor Subsidiary if such modification, election, or action occurs
without notice to the Guarantor Subsidiaries and without giving the
Guarantor Subsidiaries an opportunity to cure any default by Borrower;
(xiii) the enforceability of any provision in the Loan
Documents which provide that such Loan Documents may only be modified in
writing; and
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XXXXXX, XXXXXX & XXXXX LLP
Bank of America, N.A.
October 6, 2000
Page 6
(xiv) the validity and enforceability of covenants set
forth in the Loan Documents which purport to survive the repayment of the
indebtedness evidenced therein.
Our opinions expressed herein are limited to the laws of the State
of California, the General Corporation Law of the State of Delaware and the
federal laws of the United States of America, and we do not express any opinion
herein concerning any other law, including, but not limited to, ordinances,
regulations or practices of any county, city, or other government agency or body
within the State of California.
This Opinion is being provided at the specific request of our
client, is rendered to you in connection with the transaction referred to above
and may not be relied upon (x) by any person other than the Bank Parties, an
Eligible Assignee, or any successor in interest of any Bank Party or (y) by the
Bank Parties, an Eligible Assignee, or any successor in interest of any Bank
Party in any other context. Copies hereof may be furnished (a) to your
independent auditors and attorneys, (b) to any governmental agency or authority
having regulatory jurisdiction over you, (c) pursuant to an order of legal
process of any court or of any governmental agency or authority, or (d) in
connection with any legal action to which you are a party arising out of the
transaction referred to above. This opinion is rendered as of the date hereof,
and we hereby disclaim any obligation to advise any person entitled to rely
hereon of any change in the matters stated herein.
Very truly yours,
/s/ XXXXXX, XXXXXX & XXXXX LLP
117
EXHIBIT E
BORROWER: XXXXXXX AND BROAD HOME CORPORATION,
a Delaware corporation
GUARANTORS: See Schedule 1 hereto
TO: BANK OF AMERICA, N.A., for itself and as Administrative Agent
SUBSIDIARY GUARANTY
THIS SUBSIDIARY GUARANTY ("Guaranty") dated as of October 3, 2000,
is made by each of the parties listed on Schedule 1 hereto, together with each
other person who may become a party hereto pursuant to Section 10 of this
Guaranty (each, a "Guarantor" and collectively, "Guarantors"), jointly and
severally, in favor of Bank of America, N.A., as Administrative Agent, the
Syndication Agent, the Documentation Agent and the Banks (as those terms are
defined in the below referenced Loan Agreement), with reference to the following
facts:
RECITALS
A. Pursuant to the 2000 Term Loan Agreement of even date herewith
entered into by and among Xxxxxxx and Broad Home Corporation, a Delaware
corporation ("Borrower"), the Banks signatory thereto, Bank of America, N.A., as
Administrative Agent, Credit Lyonnais Los Angeles Branch, as Syndication Agent,
and Bank One, NA, as Documentation Agent (as the same may be amended from time
to time, the "Loan Agreement"), the Banks are making a credit facility available
to Borrower.
B. As a condition of the availability of such credit facility,
Guarantors are required to enter into this Guaranty.
C. Guarantors expect to realize direct and indirect benefits as
the result of the availability of the aforementioned credit facility, and as the
result of the execution of this Guaranty.
AGREEMENT
NOW, THEREFORE, in order to induce the Banks to extend the
aforementioned credit facility, and for other good and valuable consideration,
the receipt and adequacy of which is hereby acknowledged, each Guarantor hereby
represents, warrants, covenants, agrees and guaranties as follows:
(1) Terms used in this Guaranty but not defined herein shall have
the meanings defined for them in the Loan Agreement.
(2) Guarantors unconditionally guarantee and promise to pay to
Bank of America, N.A. as the Administrative Agent for the Banks, on demand, in
lawful money of the United States, any
(Exhibit E, Page 1 of 9)
118
and all Indebtedness of Borrower then due to the Banks. The word "Indebtedness"
means any and all advances, debts, obligations and liabilities of Borrower
heretofore, now, or hereafter made, incurred or created under the Loan Agreement
and under the Loan Documents, and whether Borrower may be liable individually or
jointly with others, or whether such Indebtedness may be or hereafter becomes
otherwise unenforceable.
(3) This Guaranty is irrevocable in nature, is a guaranty of
prompt and punctual payment and performance of all Indebtedness of Borrower, and
is not merely a guaranty of collection. The Indebtedness guaranteed hereunder
includes that arising under successive transactions which shall either continue
the Indebtedness from time to time or renew it after it has been satisfied.
Anything in this Guaranty to the contrary notwithstanding, the maximum liability
of any Guarantor hereunder shall be limited to the extent required for the
obligation of such Guarantor to be valid, binding and enforceable and not
otherwise voidable or avoidable.
(4) The obligations hereunder are joint and several, and
independent of the obligations of Borrower and any of its other Subsidiaries.
Separate action or actions may be brought and prosecuted against any Guarantor
whether action is brought against the Borrower or any of its other Subsidiaries,
including any other Guarantor, or whether Borrower or any of its other
Subsidiaries, including any other Guarantor, may be joined in any such action or
actions.
(5) Each Guarantor authorizes the Banks, without notice or demand
and without affecting its liability hereunder, from time to time to (a) renew,
compromise, extend, accelerate or otherwise change the time for payment of, or
otherwise change the terms of the Indebtedness or any part thereof, including
increase or decrease of the rate of interest thereon; (b) take and hold security
for the payment of this Guaranty or the Indebtedness guaranteed, and exchange,
enforce, waive and release any such security; (c) apply such security and direct
the order or manner of sale thereof as the Administrative Agent or any Bank in
its discretion may determine; and (d) release or substitute any one or more of
the endorsers or guarantors.
(6) Each Guarantor waives, to the fullest extent permitted by
applicable law, any right to require any Bank to (a) proceed against Borrower or
any of its other Subsidiaries, including any other Guarantor; (b) proceed
against or exhaust any security held from Borrower or any of its Subsidiaries;
or (c) pursue any other remedy in the Banks' power whatsoever. Each Guarantor
waives any defense arising by reason of any disability or other defense of
Borrower or by reason of the cessation from any cause whatsoever of the
liability of Borrower, other than payment in full of the Indebtedness. Until all
Indebtedness of Borrower to the Banks shall have been paid in full, each
Guarantor waives any right to enforce any remedy which the Banks now have or may
hereafter have against Borrower or any of its other Subsidiaries, and waives any
benefit of, and any right to participate in, any security now or hereafter held
by the Banks. Guarantors waive all rights and defenses arising out of an
election of remedies by the creditor, even though that election of remedies,
such as a nonjudicial foreclosure with respect to security for a guaranteed
obligation, has destroyed the guarantor's rights of subrogation and
reimbursement against the principal by the operation of Section 580d of the Code
of Civil Procedure or otherwise. Guarantors expressly waive to the fullest
extent permitted by applicable Law all other suretyship defenses they otherwise
might or would have under any Law. Each Guarantor waives any right of
subrogation that it may have in respect to the obligations of Borrower to the
Banks. Each Guarantor waives all presentments, demands for performance, notices
of nonperformance, protests, notices of protest, notices of dishonor, and
notices of acceptance of this Guaranty and of the existence, creation, or
incurring of new or additional Indebtedness.
(Exhibit E, Page 2 of 9)
119
(7) After demand upon the Guarantors for payment under this
Guaranty, each Guarantor hereby specifically authorizes each Bank (subject to
the approval of the Majority Banks) in which such Guarantor maintains a deposit
account (whether a general or special deposit account, other than trust
accounts) or a certificate of deposit to setoff any Obligations owed to the
Banks against such deposit account or certificate of deposit without prior
notice to any Guarantor (which notice is hereby waived) whether or not such
deposit account or certificate of deposit has then matured. Nothing in this
paragraph shall limit or restrict the exercise by a Bank of any right to setoff
or banker's lien under applicable Law, subject to the approval of the Majority
Banks.
(8) Each Guarantor represents and warrants to the Banks that it
has established adequate means of obtaining from Borrower and its Subsidiaries,
on a continuing basis, financial and other information pertaining to the
businesses, operations and condition (financial and otherwise) of Borrower and
its Subsidiaries, and that Guarantor now is and hereafter will be completely
familiar with the businesses, operations and condition (financial and otherwise)
of Borrower and its Subsidiaries. Each Guarantor hereby expressly waives and
relinquishes any duty on the part of the Banks (should any such duty exist) to
disclose to any Guarantor any matter, fact or thing related to the businesses,
operations or condition (financial or otherwise) of Borrower or its
Subsidiaries, whether now known or hereafter known by the Banks during the life
of this Guaranty.
(9) Guarantors agree to pay, within 30 days after demand, the
reasonable out-of-pocket costs and expenses of the Administrative Agent and each
of the Banks in connection with the enforcement of this Guaranty, including
without limitation the reasonable fees and out-of-pocket expenses of any legal
counsel retained by the Administrative Agent or any of the Banks.
(10) Any other Person may become a Guarantor under, and become
bound by the terms and conditions of, this Guaranty by executing and delivering
to the Administrative Agent an Instrument of Joinder substantially in the form
attached hereto as Exhibit A.
(11) This Guaranty shall be governed by and construed according to
the laws of the State of California, to the jurisdiction of which the parties
hereto submit.
"GUARANTORS"
XXXXXXX AND BROAD OF ARIZONA, INC., an
Arizona corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx
Vice President and Assistant Secretary
XXXXXXX AND BROAD - CENTRAL VALLEY,
INC., a California corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx
Vice President and Assistant Secretary
(Exhibit E, Page 3 of 9)
120
XXXXXXX AND BROAD COASTAL, INC., a
California corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx
Vice President and Assistant Secretary
XXXXXXX AND BROAD OF NORTHERN
CALIFORNIA, INC., a California corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx, Assistant Secretary
XXXXXXX AND BROAD OF SACRAMENTO, INC.,
a California corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx
Vice President, Chief Financial Officer
and Assistant Secretary
XXXXXXX AND BROAD - SOUTH BAY,
INC., a California corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx, Assistant Secretary
XXXXXXX AND BROAD OF SOUTHERN
CALIFORNIA, INC., a California corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx, Chief Financial
Officer, Treasurer and Assistant Secretary
(Exhibit E, Page 4 of 9)
121
KB HOLDINGS ONE, INC., a California
corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx
Vice President, Treasurer, Chief Financial
Officer and Assistant Secretary
XXXXXXX AND BROAD OF COLORADO, INC.,
a Colorado corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx,
Vice President and Assistant Secretary
XXXXXXX AND BROAD OF NEVADA, INC.,
a Nevada corporation
By:
------------------------------------------
Xxxxxxx X. Xxxxxxxxx
Vice President, Treasurer and Assistant
Secretary
XXXXXXX AND BROAD OF TEXAS, LTD., a Texas
limited partnership
By: KBSA, Inc., a Texas corporation,
Its general partner
By:
------------------------------------
Xxxxxxx X. Xxxxxxxxx,
Treasurer and Assistant Secretary
(Exhibit E, Page 5 of 9)
000
XXXXXXX XXX XXXXX XXXXXXXXXXX XX XXXXX, L.P.,
a Texas limited partnership
By: KBSA, Inc., a Texas corporation,
Its general partner
By:
------------------------------------
Xxxxxxx X. Xxxxxxxxx,
Treasurer and Assistant Secretary
XXXXXXX AND BROAD LONE STAR, L.P.,
a Texas limited partnership
By: KBSA, Inc., a Texas corporation,
Its general partner
By:
------------------------------------
Xxxxxxx X. Xxxxxxxxx,
Treasurer and Assistant Secretary
(Exhibit E, Page 6 of 9)
123
SCHEDULE 1
TO GUARANTY
List of Guarantors
Xxxxxxx and Broad of Arizona, Inc.
Xxxxxxx and Broad - Central Valley, Inc.
Xxxxxxx and Broad Coastal, Inc.
Kaufinan and Broad of Northern California, Inc.
Kaufinan and Broad of Sacramento, Inc.
Kaufinan and Broad - South Bay, Inc.
Xxxxxxx and Broad of Southern California, Inc.
KB Holdings One, Inc.
Xxxxxxx and Broad of Colorado, Inc.
Kaufinan and Broad of Nevada, Inc.
Xxxxxxx and Broad of Texas, Ltd.
Xxxxxxx and Broad Development of Texas, X.X.
Xxxxxxx and Broad Lone Star, L.P.
(Exhibit E, Page 7 of 9)
124
INSTRUMENT OF JOINDER
THIS INSTRUMENT OF JOINDER ("Joinder") is executed as of
_____________________, by ___________________________
__________________________________, a ______________________________("Joining
Party"), and delivered to the Administrative Agent pursuant to the Subsidiary
Guaranty dated as of October 3, 2000 (the "Guaranty"). Terms used but not
defined in this Joinder shall have the meanings defined for those terms in the
Guaranty.
RECITALS
A. The Guaranty was made by the Guarantors in favor of the Banks
that are parties to that certain 2000 Term Loan Agreement, dated as of October
3, 2000 (the "Loan Agreement") among Xxxxxxx and Broad Home Corporation, as
Borrower, the Banks signatory thereto, Bank of America, N.A., as Administrative
Agent, Credit Lyonnais Los Angeles Branch, as Syndication Agent, and Bank One,
NA, as Documentation Agent.
B. Joining Party has become a Significant Subsidiary (as defined
in the Loan Agreement) or has been designated by Borrower as a Guarantor
Subsidiary (as defined in the Loan Agreement), and as such is required pursuant
to Section 5.9 of the Loan Agreement to become a Guarantor.
C. Joining Party expects to realize direct and indirect benefits
as a result of the availability to Borrower of a credit facility pursuant to the
Loan Agreement, and as a result of becoming a party to the Guaranty.
NOW THEREFORE, Joining Party agrees as follows:
AGREEMENT
1. By this Joinder, Joining Party becomes a "Guarantor" under and
pursuant to Section 10 of the Guaranty. Joining Party agrees that, upon its
execution hereof, it will become a Guarantor under the Guaranty with respect to
all Indebtedness of Borrower heretofore or hereafter incurred under the Loan
Agreement, and will be bound by all terms, conditions, and duties applicable to
a Guarantor under the Guaranty.
Page 1 of 2
(Exhibit E, Page 8 of 9)
125
2. The effective date of this Joinder is ________________.
"Joining Party"
-------------------------------------------
a
------------------------------------------
By:
----------------------------------------
----------------------------------------
Printed Name and Title
ACKNOWLEDGED:
BANK OF AMERICA, N.A., as Administrative Agent
By:
----------------------------------------
----------------------------------------
Printed Name and Title
XXXXXXX AND BROAD HOME CORPORATION
By:
----------------------------------------
----------------------------------------
Printed Name and Title
Page 2 of 2
(Exhibit E, Page 9 of 9)
126
EXHIBIT F
31-Aug-00 31-Aug-99
------------------------------------------------- -------------------------------------------------
Deliveries Sales Backlog Avg. Price Backlog Deliveries Sales Backlog Avg. Price Backlog
Division Quarter Quarter Units (000's) Value Quarter Quarter Units (000's) Value
--------------------------- ---------- ------- ------- ---------- ------- ---------- ------- ------- ---------- -------
Greater LA................. 0 0 0 $0 $0 0 0 0 $0 $0
Orange County.............. 0 0 0 0 0 0 0 0 0 0
San Diego.................. 0 0 0 0 0 0 0 0 0 0
Northbay................... 0 0 0 0 0 0 0 0 0 0
Southbay................... 0 0 0 0 0 0 0 0 0 0
Monterey Bay............... 0 0 0 0 0 0 0 0 0 0
- - - -- -- - - - -- --
Total California......... 0 0 0 0 0 0 0 0 0 0
- - - -- -- - - - -- --
Las Vegas*................. 0 0 0 0 0 0 0 0 0 0
Reno....................... 0 0 0 0 0 0 0 0 0 0
Phoenix.................... 0 0 0 0 0 0 0 0 0 0
Tucson..................... 0 0 0 0 0 0 0 0 0 0
New Mexico................. 0 0 0 0 0 0 0 0 0 0
Dallas..................... 0 0 0 0 0 0 0 0 0 0
Houston.................... 0 0 0 0 0 0 0 0 0 0
San Antonio................ 0 0 0 0 0 0 0 0 0 0
Austin..................... 0 0 0 0 0 0 0 0 0 0
Colorado................... 0 0 0 0 0 0 0 0 0 0
Utah....................... 0 0 0 0 0 0 0 0 0 0
- - - -- -- - - - -- --
Total Other US........... 0 0 0 0 0 0 0 0 0 0
- - - -- -- - - - -- --
Total United States...... 0 0 0 0 0 0 0 0 0 0
Maisons Individuelles...... 0 0 0 0 0 0 0 0 0 0
KBD........................ 0 0 0 0 0 0 0 0 0 0
- - - -- -- - - - -- --
Total France............. 0 0 0 0 0 0 0 0 0 0
Mexico..................... 0 0 0 0 0 0 0 0 0 0
- - - -- -- - - - -- --
Total.................... 0 0 0 $0 $0 0 0 0 $0 $0
= = = == == = = = == ==
* Includes unconsolidated
Monaco joint venture..... 0 0 0 $0 $0 0 0 0 $0 $0
= = = == == = = = == ==
California................. 0% 0% 0% 0% 0% 0% 0% 0%
Other US................... 0% 0% 0% 0% 0% 0% 0% 0%
Total United States...... 0% 0% 0% 0% 0% 0% 0% 0%
France..................... 0% 0% 0% 0% 0% 0% 0% 0%
Mexico..................... 0% 0% 0% 0% 0% 0% 0% 0%
Total.................... 0% 0% 0% 0% 0% 0% 0% 0%
Difference
-------------------------------------------------
Deliveries Sales Backlog Avg. Price Backlog
Division Quarter Quarter Units (000's) Value
--------------------------- ---------- ------- ------- ---------- -------
Greater LA................. 0 0 0 $0 $0
Orange County.............. 0 0 0 0 0
San Diego.................. 0 0 0 0 0
Northbay................... 0 0 0 0 0
Southbay................... 0 0 0 0 0
Monterey Bay............... 0 0 0 0 0
- - - -- --
Total California......... 0 0 0 0 0
- - - -- --
Las Vegas*................. 0 0 0 0 0
Reno....................... 0 0 0 0 0
Phoenix.................... 0 0 0 0 0
Tucson..................... 0 0 0 0 0
New Mexico................. 0 0 0 0 0
Dallas..................... 0 0 0 0 0
Houston.................... 0 0 0 0 0
San Antonio................ 0 0 0 0 0
Austin..................... 0 0 0 0 0
Colorado................... 0 0 0 0 0
Utah....................... 0 0 0 0 0
- - - -- --
Total Other US........... 0 0 0 0 0
- - - -- --
Total United States...... 0 0 0 0 0
Maisons Individuelles...... 0 0 0 0 0
KBD........................ 0 0 0 0 0
- - - -- --
Total France............. 0 0 0 0 0
Mexico..................... 0 0 0 0 0
- - - -- --
Total.................... 0 0 0 $0 $0
= = = == ==
* Includes unconsolidated
Monaco joint venture..... 0 0 0 $0 $0
= = = == ==
127
EXHIBIT G
XXXXXXX AND BROAD HOME CORPORATION
SUMMARY OF INVENTORY
AS OF MAY 31, 2000
Site of Project (Lots/Acres)
Inventory Book Value (Thousands) --------------------------------------------------------
-------------------------------- Land in Production Land Under Development
Home/Lots Land Under Secured Total Total ------------------ ----------------------
Total in Prod Development Debt Lots Acres W/Homes WO/Homes Lots Acres
--------- --------- ----------- ------- ----- ----- -------- -------- ---------- ----------
California
Greater LA..............
Orange County...........
San Diego...............
Northbay................
Southbay................
--------- --------- ----------- ------- ------- ------- -------- -------- ---------- ----------
Total California...... -- -- -- -- -- -- -- -- -- --
--------- --------- ----------- ------- ------- ------- -------- -------- ---------- ----------
Other US
Las Vegas...............
Reno....................
Phoenix.................
Tucson..................
New Mexico..............
Dallas..................
Houston.................
San Antonio.............
Austin..................
Colorado................
Utah....................
--------- --------- ----------- ------- ------- ------- -------- -------- ---------- ----------
Total Other US........ -- -- -- -- -- -- -- -- -- --
--------- --------- ----------- ------- ------- ------- -------- -------- ---------- ----------
Total United States... -- -- -- -- -- -- -- -- -- --
France
Maisons Individuelles...
KBD..................... --------- --------- ----------- ------- ------- ------- -------- -------- ---------- ----------
Total France.......... -- -- -- -- -- -- -- -- -- --
--------- --------- ----------- ------- ------- ------- -------- -------- ---------- ----------
Mexico
Other Properties......... #REF1
--------- --------- ----------- ------- ------- ------- -------- -------- ---------- ----------
Total Inventory........... $ -- $ -- $ -- $ -- -- -- -- -- #REF1 --
========= ========= =========== ======= ======= ======= ======== ======== ========== ==========
----------------------------------------------------
Key
SFD Single Family Detached OPT Option
SFA Single Family Attached OFF Office Buildings
APP Apartments IND Industrial
MPC Master Planned Community COM Commercial
CON Condominium REN Renovation
----------------------------------------------------
128
SCHEDULE 1.1
XXXXXXX & BROAD HOME CORP. NEW 2000 REVOLVER
COMMITMENTS
PRORATA SHARE AS OF
-------------------------------
PERCENT DOLLARS
BANK COMMITMENT COMMITMENTS
---- ---------- -----------
BANK OF AMERICA 33.516532222% $189,050,000.00
CREDIT LYONNAIS 13.793103448% $ 77,800,000.00
BANK ONE 13.793103448% $ 77,800,000.00
GUARANTY FEDERAL 6.896551724% $ 38,900,000.00
BANK UNITED 8.275862069% $ 46,680,000.00
SUN TRUST 6.896551724% $ 38,900,000.00
IBJ 2.758620690% $ 15,560,000.00
COMERICA 4.137931034% $ 23,340,000.00
KBC 1.655881571% $ 9,340,000.00
PNC BANK 4.827586207% $ 27,230,000.00
CITICORP USA, INC. 3.448275862% $ 19,450,000.00
TOTAL 100.00% $564,050,000.00
129
SCHEDULE 4.4
XXXXXXX AND BROAD HOME CORPORATION AND
CONSOLIDATED SUBSIDIARIES
KEY TO "TYPES"
S = SIGNIFICANT SUBSIDIARY
G = GUARANTOR SUBSIDIARY
Fo = FOREIGN SUBSIDIARY
Fi = FINANCIAL SUBSIDIARY
(NOTE: ALL GUARANTOR SUBSIDIARIES ARE
ALSO SIGNIFICANT SUBSIDIARIES)
ARIZONA CORPORATIONS % TYPE(S)
-------------------- --- -------
Xxxxxxx and Broad of Arizona, Inc. 100 S/G
Xxxxxxx and Broad Home Sales of Arizona, Inc. 100
Xxxxxxx and Broad of Tucson, Inc. 100
Xxxxxxx and Broad Home Sales of Tucson, Inc. 100
CALIFORNIA CORPORATIONS
-----------------------
BPP Holdings, Inc. 100
Branching Tree Corp. 100
Cable Associates, Inc. 100
Custom Decor, Inc. 100
First Northern Builders Servicing, Inc. 100
KBASW Mortgage Acceptance Corporation 100 Fi
KBI/Mortgage Acceptance Corporation 100 Fi
KBRAC IV Mortgage Acceptance Corporation 100 Fi
Xxxxxxx and Broad Architecture, Inc. 100
Xxxxxxx and Broad - Central Valley, Inc. 100 S/G
Xxxxxxx and Broad Coastal, Inc. 100 S/G
Xxxxxxx and Broad Communities, Inc. 100
Xxxxxxx and Broad Development Group 100
Xxxxxxx and Broad Embarcadero, Inc. 100
Xxxxxxx and Broad Holdings, Inc. 100
Xxxxxxx and Broad Home Sales, Inc. 100
Xxxxxxx and Broad Home Sales of Northern California, Inc. 100
Xxxxxxx and Broad Insurance Agency, Inc. 100
Xxxxxxx and Broad International, Inc. 100
Xxxxxxx and Broad Land Company 100
Xxxxxxx and Broad Land Development Venture, Inc. 100
Xxxxxxx and Broad - Monterey Bay, Inc. 100
Xxxxxxx and Broad - Xxxxxx/Perris Valleys, Inc. 100
Xxxxxxx and Broad Multi-Family, Inc. 100
Xxxxxxx and Broad of Northern California, Inc. 100 S/G
Xxxxxxx and Broad Xxxxxxxxx, Inc. 100
Xxxxxxx and Broad Properties 100
130
Xxxxxxx and Broad of Sacramento, Inc. 100 S/G
Xxxxxxx and Broad of San Diego, Inc. 100
Xxxxxxx and Broad - South Bay, Inc. 100 S/G
Xxxxxxx and Broad of Southern California, Inc. 100 S/G
Xxxxxxx and Broad of Utah, Inc. 100
KB Holdings One, Inc. 100 S/G
Kent Land Company 100
Kingsbay Escrow Company 100
Xxxxx Homes Management Corp. 100
Xxxxxx Housing Company, LLC 100
CANADIAN CORPORATIONS
---------------------
Margreen Investments, Inc. 100 Fo
3238865 Canada Inc. 100 Fo
COLORADO CORPORATION
--------------------
Xxxxxxx and Broad of Colorado, Inc. 100 S/G
DELAWARE CORPORATIONS/LLCs
--------------------------
Eden Land Development Corp. 100
e.KB, Inc. 100
Xxxxx Homebuilding Co. 100
General Homes Corporation 100
General Homes of Arizona 100
General Homes of Dallas 100
General Homes of Florida 100
General Homes of Houston 100
General Homes Development LLC 100
GH Homebuilding Holdings, Inc. 100
HomeSafe Escrow Company 100
KB City Ranch, Inc. 100
International Mortgage Acceptance Corporation 100 Fi
Xxxxxxx and Broad Development Company 100
Xxxxxxx and Broad Limited 100
KBHC Financing I 3
LHE Arctic LLC 100
LHN Arctic LLC 100
LDC Arctic LLC 100
LP Arctic LLC 100
LHC Arctic LLC 100
rateOne Home Loans, LLC 100 Fi
Rate One Associates, Inc. 100 Fi
Rate One Holdings, Inc. 100 Fi
131
FRENCH CORPORATIONS
-------------------
Xxxxxxx and Broad Developpement SA. 57.47 Fo/S
Xxxxxxx and Broad SA. 57.47 Fo/S
Xxxxxxx and Broad Promotion Maisons Individuelles SA. 57.47 Fo
Xxxxxxx and Broad Renovation S.A.R.L. 57.47 Fo
SMCI Developpement. SA. 57.47 Fo
Gie KB 57.47 Fo
Park SA 57.46 Fo
Millet, S. A. R. L. 57.47 Fo
LMP Xxxxxx S. A. R. L. 57.47 Fo
ILLINOIS CORPORATIONS
---------------------
Xxxxxxx and Broad of Illinois, Inc. 100
Xxxxxxx and Broad Mortgage Company 100 Fi/S
MASSACHUSETTS CORPORATION
-------------------------
Xxxxxxx and Broad Homes, Inc. 100
MEXICAN CORPORATIONS
--------------------
Xxxxxxx y Broad de Mexico 100 Fo
Xxxxxxx y Broad Asesoria Administrativa 100 Fo
Operadora Los Xxxxxx 100 Fo
Desarrollos Los Xxxxxx 100 Fo
MICHIGAN CORPORATION
--------------------
Keywick, Inc. 100
MINNESOTA CORPORATION
---------------------
Xxxxxxx and Broad Custom Homes, Inc. 100
NEVADA CORPORATION
------------------
Desert Inn Development, LLC 100
Xxxxxxx and Broad Home Sales of Nevada, Inc. 100
Xxxxxxx and Broad of Nevada, Inc. 100 S/G
Xxxxxxx and Broad Home Sales of Reno, Inc. 100
Xxxxxxx and Broad of Reno, Inc. 100
Xxxxx Homes - Carlyle Venture L. L. C. 50
132
NEW MEXICO CORPORATIONS
-----------------------
Xxxxxxx and Broad Home Sales of New Mexico, Inc. 100
Xxxxxxx and Broad of New Mexico, Inc. 100
NEW YORK CORPORATION
--------------------
Xxxxxxx and Broad Homes of Long Island, Inc. 100
TEXAS CORPORATIONS AND PARTNERSHIPS
-----------------------------------
Eden Corporation 100
Envirographic, Inc. 100
FGMC, Inc. 100
Hallmark Residential Group, Inc. 100
Xxxxxxx and Broad Insurance Agency of Texas Holdings, Inc. 000
Xxxxxxx xxx Xxxxx xx Xxxxx, Ltd. 100 S/G
Xxxxxxx and Broad Development of Texas, L. P. 100 S/G
Xxxxxxx and Broad Lone Star, LP 100 S/G
KBSA Inc. 100
Rayco Land Development, Inc. 100
San Antonio Title Co. 100
SATEX Properties, Inc. 100
Quoin Investments, Inc. 100
133
Schedule 4.7
Existing Liens or Rights of Others
As of August 31, 2000
NONE
(Schedule 4.7 - Page 1 of 1)
134
SCHEDULE 4.9
Existing Indebtedness and Contingent Guaranty Obligations
as of August 31, 2000
Amount Total
------ -----
$(000) $(000)
DEBT:
KBHC SECURED DEBT:
California 12,007
Other U.S. 6,671
International 8,659
27,337
KBMC SECURED DEBT:
Commercial Paper 305,895
Mortgage Warehouse Facility 31,245
337,140
UNSECURED DEBT:
Senior Debt 7-3/4% 175,000
Senior Sub Debt 9-3/8% 174,491
Senior Sub Debt 9-5/8% 124,568
Revolving Credit Line 397,000
Other Unsecured 94,848
965,907
---------
TOTAL DEBT 1,330,384
=========
CONTINGENT GUARANTEE OBLIGATIONS:
KBHC
Letters of Credit 37,445
Xxxxxxx Housing 45,146
TOTAL CONTINGENT GUARANTEE OBLIGATIONS 82,591
=========
TOTAL DEBT AND CONTINGENT
CONTINGENT GUARANTEE OBLIGATIONS 1,412,975
=========
135
SCHEDULE 6.4
G
INVESTMENTS IN AND ADVANCES TO JOINT VENTURES
FYE 11-30-00 (000'S)
11-30-99 2-29-00 5-31-00 8-31-00 11-30-00
------------------------------------------------------
Construction
------------
Greater LA
City Ranch 15,906 16,469 16,431 16,451 -
------------------------------------------------------
Total 15,906 16,469 16,431 16,451 -
------------------------------------------------------
Las Vegas
Carlyle 907 1,872 1,848 2,398 -
------------------------------------------------------
Total 907 1,872 1,848 2,398 -
------------------------------------------------------
New Mexico
Xxxxxxxx Xxxxx 0 0 0 0 -
Xxx Xxxxxxxx 251 252 301 301 -
------------------------------------------------------
Total 253 254 303 303
------------------------------------------------------
Houston
Southwyck Management 35 35 - - -
Performance Mortgage Partners, Ltd. 25 25 - - -
------------------------------------------------------
Total 60 60 - - -
------------------------------------------------------
Maison Individuelles
Villabe Les Heurts (8) (8) (10) (9) -
------------------------------------------------------
Total (8) (8) (10) (9) -
------------------------------------------------------
KBD
Issy Guynemer (104) (1) (1) (1) -
Des Pepinieres (26) 3 2 2 -
Xxxxx Xxxxxxx 62 61 57 55 -
Haussmann 1,302 1,248 1,213 1,113 -
Hoche Monceau 24 11 11 10 -
Meudon Les Montalets (2) (2) (2) (2) -
Villa D'Auteuil 2,409 2,306 2,240 2,121 -
Terrasse De Chatillon (134) (127) (94) (118) -
Domaine Xx Xxxxxxxx 000 000 000 00 -
Xxxx X'Xxxxxxxx (102) (25) 2 1 -
Sari Samlou 185 503 550 737 -
Xxxxxxxx - 1 2 14 -
Quai de la Marne - 87 4 4 -
Archeveche - - (1) (1) -
Ave du Maine - 376 4 39 -
Quadrilatere - (360) (2) (27) -
Dohomey - (2) - - -
Illot Paille - (82) (19) 204 -
Briand - 80 328 34 -
------------------------------------------------------
Total 4,172 4,614 4,395 4,249
------------------------------------------------------
TOTAL 21,290 23,261 22,967 23,392 -
======================================================
