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EXHIBIT 10.14
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1997 REVOLVING LOAN AGREEMENT
Dated as of April 21, 1997
among
XXXXXXX AND BROAD HOME CORPORATION
THE BANKS PARTY HERETO
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Administrative Agent, Co-Syndication Agent
and Managing Agent
NATIONSBANK OF TEXAS, N.A.,
as Syndication Agent and Managing Agent
CREDIT LYONNAIS LOS ANGELES BRANCH
as Documentation Agent and Managing Agent
and
GUARANTY FEDERAL BANK F.S.B., SOCIETE GENERALE AND
UNION BANK OF CALIFORNIA, N.A.,
as Co-Agents
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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...................................................... 25
1.3 Accounting Terms.......................................................... 25
1.4 Rounding.................................................................. 26
1.5 Miscellaneous Terms....................................................... 26
1.6 Exhibits and Schedules.................................................... 26
1.7 References to "Borrower and its Subsidiaries"............................. 26
Article 2 LOANS AND LETTERS OF CREDIT............................................... 27
2.1 Loans-General............................................................. 27
2.2 Alternate Base Rate Loans................................................. 28
2.3 LIBOR Loans............................................................... 29
2.4 Swing Line................................................................ 29
2.5 Letters of Credit......................................................... 31
2.6 Reduction of Commitments/Extension of Line B Maturity Date ............... 36
2.7 Administrative Agent's Right to Assume Funds Available.................... 38
Article 3 PAYMENTS; FEES............................................................ 39
3.1 Principal and Interest.................................................... 39
3.2 Upfront Fee............................................................... 42
3.3 Commitment Fees........................................................... 42
3.4 Advance Fees.............................................................. 43
3.5 Agency Fees............................................................... 43
3.6 Capital Adequacy.......................................................... 43
3.7 LIBOR Fees and Costs...................................................... 45
3.8 Late Payments/Default Interest............................................ 48
3.9 Computation of Interest and Fees.......................................... 48
3.10 Holidays.................................................................. 49
3.11 Payment Free of Taxes..................................................... 49
3.12 Funding Sources........................................................... 50
3.13 Failure to Charge or Making of Payment Not Subsequent Waiver.............. 50
3.14 Time and Place of Payments; Evidence of Payments; Application of Payments. 50
3.15 Administrative Agent's Right to Assume Payments Will be Made.............. 50
3.16 Survivability............................................................. 51
3.17 Bank Calculation Certificate.............................................. 51
3.18 Transition................................................................ 51
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Article 4 REPRESENTATIONS AND WARRANTIES............................................ 53
4.1 Existence and Qualification; Power; Compliance with Law .................. 53
4.2 Authority; Compliance with Other Instruments and Government Regulations... 53
4.3 No Governmental Approvals Required........................................ 54
4.4 Subsidiaries.............................................................. 54
4.5 Financial Statements...................................................... 55
4.6 No Other Liabilities; No Material Adverse Effect.......................... 55
4.7 Title to Assets........................................................... 55
4.8 Intangible Assets......................................................... 56
4.9 Existing Indebtedness and Contingent Guaranty Obligations ................ 56
4.10 Governmental Regulation................................................... 56
4.11 Litigation................................................................ 56
4.12 Binding Obligations....................................................... 56
4.13 No Default................................................................ 56
4.14 Pension Plans............................................................. 56
4.15 Tax Liability............................................................. 57
4.16 Regulation U.............................................................. 57
4.17 Environmental Matters..................................................... 57
4.18 Disclosure................................................................ 57
4.19 Projections............................................................... 57
Article 5 AFFIRMATIVE COVENANTS (OTHER THAN INFORMATION AND REPORTING REQUIREMENTS). 58
5.1 Payment of Taxes and Other Potential Liens................................ 58
5.2 Preservation of Existence................................................. 58
5.3 Maintenance of Properties................................................. 58
5.4 Maintenance of Insurance.................................................. 58
5.5 Compliance with Laws...................................................... 59
5.6 Inspection Rights......................................................... 59
5.7 Keeping of Records and Books of Account................................... 59
5.8 Use of Proceeds........................................................... 59
5.9 Subsidiary Guaranty....................................................... 59
Article 6 NEGATIVE COVENANTS........................................................ 60
6.1 Payment or Prepayment of Subordinated Obligations......................... 60
6.2 Dispositions.............................................................. 60
6.3 Mergers and Sale of Assets................................................ 60
6.4 Investments and Acquisitions.............................................. 60
6.5 ERISA Compliance.......................................................... 61
6.6 Change in Business........................................................ 61
6.7 Liens and Negative Pledges................................................ 61
6.8 Transactions with Affiliates.............................................. 63
6.9 Consolidated Tangible Net Worth........................................... 63
6.10 Consolidated Leverage Ratio............................................... 64
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6.11 Consolidated Interest Coverage Ratio...................................... 64
6.12 Distributions............................................................. 65
6.13 Amendments................................................................ 65
6.14 Hostile Tender Offers..................................................... 65
6.15 Inventory................................................................. 65
6.16 Certain Investments....................................................... 66
6.17 Money Market Indebtedness................................................. 66
6.18 Domestic Standing Inventory............................................... 66
6.19 Future Subsidiaries....................................................... 66
Article 7 INFORMATION AND REPORTING REQUIREMENTS.................................... 67
7.1 Financial and Business Information of Borrower and Its Subsidiaries....... 67
7.2 Compliance Certificate.................................................... 69
Article 8 CONDITIONS................................................................ 71
8.1 Initial Advances.......................................................... 71
8.2 Any Advance............................................................... 72
8.3 Any Letter of Credit...................................................... 72
Article 9 EVENTS OF DEFAULT AND REMEDIES UPON EVENTS OF DEFAULT..................... 74
9.1 Events of Default......................................................... 74
9.2 Remedies Upon Event of Default............................................ 76
Article 10 THE ADMINISTRATIVE AGENT.................................................. 79
10.1 Appointment and Authorization............................................. 79
10.2 Administrative Agent and Affiliates....................................... 79
10.3 Banks' Credit Decisions................................................... 79
10.4 Action by Administrative Agent............................................ 79
10.5 Liability of Administrative Agent......................................... 80
10.6 Indemnification........................................................... 81
10.7 Successor Administrative Agent............................................ 82
10.8 No Obligations of Borrower................................................ 82
Article 11 MISCELLANEOUS............................................................. 83
11.1 Cumulative Remedies; No Waiver............................................ 83
11.2 Amendments; Consents...................................................... 83
11.3 Costs, Expenses and Taxes................................................. 84
11.4 Nature of Banks' Obligations.............................................. 85
11.5 Representations and Warranties............................................ 85
11.6 Notices................................................................... 85
11.7 Execution in Counterparts................................................. 85
11.8 Binding Effect; Assignment................................................ 86
11.9 Sharing of Setoffs........................................................ 88
11.10 Indemnity by Borrower..................................................... 89
11.11 Nonliability of Banks..................................................... 89
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11.12 Confidentiality........................................................... 90
11.13 No Third Parties Benefited................................................ 90
11.14 Other Dealings............................................................ 90
11.15 Right of Setoff - Deposit Accounts........................................ 90
11.16 Further Assurances........................................................ 91
11.17 Integration............................................................... 91
11.18 Governing Law............................................................. 91
11.19 Severability of Provisions................................................ 91
11.20 Headings.................................................................. 91
11.21 Conflict in Loan Documents................................................ 91
11.22 Waiver Of Jury Trial...................................................... 91
11.23 Purported Oral Amendments................................................. 92
11.24 Hazardous Materials Indemnity............................................. 92
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Exhibits
A - Commitment Assignment and Acceptance
B - Compliance Certificate
C-1 - Line A Note
C-2 - Line B 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
3.18 Outstanding Letters of Credit
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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1997 REVOLVING LOAN AGREEMENT
Dated as of April 21, 1997
This 1997 Revolving 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 National Trust and Savings
Association, as Administrative Agent and Co-Syndication Agent, NationsBank of
Texas, N.A., as Syndication Agent and Credit Lyonnais, as Documentation Agent
(collectively, the "Managing Agents") and Guaranty Federal Bank F.S.B., Societe
Generale and Union Bank of California, N.A., as Co-Agents.
RECITALS
This Agreement is an amendment and restatement in full of that
certain Fourth Amended and Restated Loan Agreement dated as of February 28, 1996
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 (the "Prior Loan Agreement"). The terms and provisions
of this Agreement shall become effective and shall supersede the terms of the
Prior Loan Agreement as of the 1997 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:
"1997 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 Agreement by the Administrative
Agent to Borrower.
"Acquisition" means any transaction, or any series of related
transactions, consummated after the 1997 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
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directors or (c) acquires control of a 50% or more ownership interest in
any partnership, joint venture or other business entity.
"Administrative Agent" means Bank of America or any successor
administrative agent.
"Administrative Agent's Office" means Bank of America National
Trust and Savings Association, CRESG-LA National #1357, 000 Xxxxx Xxxxxx
Xxxxxx, 0xx Xxxxx, Xxx Xxxxxxx, 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.
"Agreement" means this 1997 Revolving Loan Agreement, either as
originally executed or as it may from time to time be supplemented,
modified, amended, renewed, extended or supplanted.
"Alternate Base Rate" means, as of any date of determination, the
rate per annum which is the greater of (a) the Reference Rate or (b) the
Federal Funds Rate plus one half percent (1/2%).
"Alternate Base Rate Advance" means an Advance made by a Bank to
fund its Pro Rata Share of an Alternate Base Rate Loan.
"Alternate Base Rate Loan" means a Loan made hereunder and
designated or redesignated as an Alternate Base Rate Loan in accordance
with Article 2, or converted to an Alternate Base Rate Loan in
accordance with Article 3.
"Applicable Advance Fee Rate" means, as of any date of
determination, a per annum fee rate equal to the amount by which (a) the
then Applicable Line A Commitment Fee Rate exceeds (b) the then
Applicable Line B Commitment Fee Rate.
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"Applicable Alternate Base 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 Alternate Base Rate
Pricing Level Spread
------------- -------------------
I 0.00%
II 0.00%
III 0.00%
IV 0.00%
V 0.25%
"Applicable Letter of Credit Fee" means, as of any date of
determination, a letter of credit fee equal to the Applicable LIBOR
Spread on that date.
"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
Pricing Level LIBOR Spread
------------- ------------
I 0.80%
II 0.875%
III 0.95%
IV 1.15%
V 1.50%
"Applicable Line A Commitment Fee Rate" means, as of any date of
determination, the commitment fee rate set forth below opposite the
Applicable Pricing Level as of such date:
Line A
Applicable Commitment
Pricing Level Fee Rate
------------- --------
I 0.15%
II 0.15%
III 0.20%
IV 0.25%
V 0.35%
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"Applicable Line B Commitment Fee Rate" means, as of any date of
determination, the facility fee rate set forth below opposite the
Applicable Pricing Level as of such date:
Line B
Applicable Commitment
Pricing Level Fee Rate
------------- --------
I 0.10%
II 0.10%
III 0.125%
IV 0.15%
V 0.20%
"Applicable Minimum Hold Requirement" means, in the case of any
Bank, the amount of the Pro Rata Share of the Commitments 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, in the case of each Managing Agent and each Co-Agent,
$25,000,000 or, in the case of a Bank that holds only a Line B Note,
$5,000,000 or in the case of any other Bank, $15,000,000.
"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
------------------------ ----------------------------
II Consolidated Leverage Ratio of
less than or equal to 1.25 to 1.00
III Consolidated Leverage Ratio of
higher than 1.25 to 1.00, but
less than or equal to 1.80 to
1.00
IV Consolidated Leverage Ratio of
higher than 1.80 to 1.00, but
less than or equal to 2.25 to
1.00
V Consolidated Leverage Ratio of
higher than 2.25 to 1.00.
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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.
"Authorizations" has the meaning set forth for that term in
Section 4.1.
"Bank" means any of the banks party to this Agreement and "Banks"
means all of such banks.
"Bank of America" means Bank of America National Trust and
Savings Association, a national banking 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, at the request of Borrower or one of its Subsidiaries,
will issue bonds to finance a portion of the costs of acquisition of and
improvements to real property located in such municipality (or district)
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.
"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;
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(b) certificates of deposit issued by, deposits in,
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 or
any state thereof 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 Xxxxx'x Investors Service, Inc.
(or a successor rating agency) or A-1 or higher by Standard &
Poor's Rating Group (a division of XxXxxx-Xxxx, Inc.) (or a
successor rating agency), in each case due within one year after
the date of the making of the Investment; and
(c) readily marketable commercial paper of (i) any Bank
that is a Bank as of the 1997 Closing Date or (ii) corporations
doing business in and incorporated under the Laws of the United
States of America or any state thereof given on the date of such
Investment a credit rating of P-1 or higher by Xxxxx'x Investors
Service, Inc. (or a successor rating agency), of A-1 or higher by
Standard & Poor's Rating Group (a division of XxXxxx-Xxxx, Inc.)
(or a successor rating agency), or F-1 or higher by Fitch
Investor Services, Inc. (or a successor rating agency), in each
case due within one year of the making of the Investment.
"Change in Control" has the meaning set forth for such term in
Section 3.1(f).
"Co-Agents" means Guaranty Federal Bank F.S.B., Societe Generale
and Union Bank of California, N.A., in each case so long as such bank is
a Bank hereunder. The Co-Agents shall have no duties under the Loan
Documents beyond those of Banks.
"Co-Syndication Agent" means Bank of America, so long as such
bank is a Bank hereunder. The Co-Syndication Agent, in such capacity,
shall have no duties under the Loan Documents beyond those of a Bank.
"Code" means the Internal Revenue Code of 1986, as amended or
replaced and as in effect from time to time.
"Commission" means the Securities and Exchange Commission and any
successor commission.
"Commitment Assignment and Acceptance" means a commitment
assignment and acceptance substantially in the form of Exhibit A.
"Commitments" means, collectively, the Line A Commitment and the
Line B Commitment. The Pro Rata Shares of the Banks with respect to the
Commitments are set forth in Schedule 1.1.
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"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 (excluding any non-cash items included in
Consolidated Interest Expense) plus (ii) 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).
"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 Shareholder's Equity of Borrower
and its Consolidated Subsidiaries attributable to Borrower's equity
interest in the Shareholder's Equity of all Joint Ventures (other than
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KBMHG and any Subsidiary of KBMHG engaged solely in development of
multi-family housing and related businesses) 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 Subsidiary" means, with respect to Borrower, all of
the Subsidiaries of Borrower.
"Consolidated Tangible Net Worth" means, as of any date of
determination, the Shareholder's Equity of Borrower and its Consolidated
Subsidiaries on a consolidated basis 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)
minus all Indebtedness and Contingent Guaranty Obligations of the
Financial Subsidiaries on that date.
"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 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
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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 notice or
passage of time or both, would be an Event of Default.
"Default Rate" means the interest rate described in Section 3.8.
"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.
"Disposition" means the sale, transfer or other disposition of
any of the capital stock of any Significant Subsidiary or of all or
substantially all of the assets of any Significant Subsidiary.
"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 Credit Lyonnais, 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.
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"Dollars" means the national currency of the United States of
America.
"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, all items of unsold housing inventory (other than Model
Homes) of Borrower and its Domestic Subsidiaries with respect to which
either (a) 90% of the direct construction costs have been incurred on
such date or (b) at least ten 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 KBMHG (and each Subsidiary thereof) shall in all
events be considered a Domestic Subsidiary of Borrower and Xxxxxxx and
Broad International, 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 (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 1997 Closing Date) to bring
such real Property to "finished lot" status and (b) owned by other
Persons but which, if owned by Borrower or any of its Subsidiaries on
that date, would have satisfied the requirement set forth in clause (a),
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 20% or more of the purchase price provided for in such option
to purchase. 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
-10-
17
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 (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 set forth for that term in
Section 9.1.
"Federal Funds Rate" means the rate per annum equal to the
weighted average (rounded upwards, if necessary, to the nearest 1/100th
of one percent) of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers as published for such day (or, if such day is not a Banking Day,
for the next preceding Banking Day) by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day which is a
Banking Day, the average, the average (rounded upwards, if necessary, to
the nearest 1/100th of one percent) of the quotations for such day on
transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by the Administrative
Agent.
"Financial Subsidiary" means (a) the Mortgage Company, so long as
it continues to engage in the mortgage banking business, and its
Subsidiaries, (b) any Subsidiary of Borrower that is organized and
operates solely to issue collateralized mortgage obligations, and (c)
any other Subsidiary of Borrower that (i) is engaged primarily in the
business of origination, marketing, and servicing of residential
-11-
18
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.
"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.
"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, but excludes KBMHG (and each Subsidiary
thereof).
"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 prior dates and for 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.
-12-
19
"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 to become 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 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 1997 Closing Date, as such write-up may
decrease (but not increase) from time to time.
-13-
20
"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 LIBOR Period shall end on the next preceding LIBOR Market
Day, and (c) no Interest Period may extend beyond (i) the Maturity Date,
in the case of Loans under the Line A Commitment or (ii) the Line B
Maturity Date, in the case of Loans under the Line B Commitment.
"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. The
amount of any Investment shall be the amount actually invested, 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 Moody's and (c) at least BBB- in the case of Duff. For purposes
of the foregoing, "S&P" means Standard & Poor's Rating Group (a division
of XxXxxx-Xxxx, Inc.) and its successors, "Moody's" means Moody's
Investor's Service, Inc. and its successors, "Duff" means Duff & Xxxxxx,
Inc. and its successors and "Rating Agencies" means S&P, Moody's and
Duff.
"Issuing Bank" means, subject to Section 2.5(h), Bank of America.
"Joint Venture" means any Person (a) in which Borrower or any
Subsidiary of Borrower holds an equity Investment and (b) which has at
least one holder of its equity interests that is not an Affiliate of
Borrower or any Subsidiary of Borrower.
"KBMHG" means Xxxxxxx and Broad Multi-Housing Group, Inc., a
Subsidiary of Borrower.
"Laws" means, collectively, all foreign, federal, state and local
statutes, treaties, codes, ordinances, rules, regulations and
controlling precedents of any Governmental Agency.
"Letters of Credit" means any of the standby or commercial
letters of credit (including financial and performance letters of
credit) issued by an Issuing Bank
-14-
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under the Line A Commitment pursuant to Section 2.5, either as
originally issued or as the same may be supplemented, modified, amended,
renewed, extended or supplanted.
"Letter of Credit Usage" means, as of any date of determination,
the aggregate undrawn face amount of outstanding Letters of Credit plus
the aggregate amount of unreimbursed draws under Letters of Credit.
"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.
"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.
-15-
22
"Line A Commitment" means, subject to Section 2.6, $400,000,000.
The Pro Rata Shares of the Banks with respect to the Line A Commitment
are set forth in Schedule 1.1.
"Line A Note" means each promissory note made by Borrower to a
Bank evidencing the Advances under that Bank's Pro Rata Share of the
Line A commitment, substantially in the form of Exhibit C-1, either as
originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or supplanted.
"Line B Commitment" means, subject to Section 2.6, $100,000,000.
The Pro Rata Shares of the Banks with respect to the Line B Commitment
are set forth in Schedule 1.1.
"Line B Maturity Date" means the day 364 days after the 1997
Closing Date, subject to any extension of the Line B Maturity Date
pursuant to Section 2.6.
"Line B Note" means each promissory note made by Borrower to a
Bank evidencing the Advances under that Bank's Pro Rata Share of the
Line B Commitment, substantially in the form of Exhibit C-2, either as
originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or supplanted.
"Loan" means any of the groups of Advances made at any one time
by the Banks.
"Loan Documents" means, collectively, this Agreement, the Notes,
the Swing Line Documents, the Subsidiary Guaranty and any other
agreement or instrument that may hereafter be executed and delivered by
Borrower or a Subsidiary of Borrower in favor of the Banks relating to
or in furtherance of this Agreement.
"London Interbank Offered Rate" means, for each LIBOR Loan, the
per annum rate (rounded upward to the nearest 1/100 of 1%), determined
solely by the Administrative Agent, at which Bank of America's branch in
London, England would offer deposits of Dollars in the LIBOR Market at
or about 11:00 a.m., London time, on the day two LIBOR Market Days
preceding the first day of the applicable Interest Period for
approximately the same time period as the applicable Interest Period and
in an amount approximately equal to Bank of America's Pro Rata Share of
that LIBOR Loan.
"Majority Banks" means (a) as of any date of determination, if
the Line A Commitment and the Line B Commitment are then in effect,
Banks holding in the aggregate in excess of 50% of the Commitments then
in effect, (b) as of any date of determination, if the Line A Commitment
is then in effect but the Line B Commitment has then been terminated,
Banks holding in the aggregate in excess of 50% of the sum
-16-
23
of the Line A Commitments then in effect plus the aggregate Indebtedness
then evidenced by the Line B Notes or (c) as of any date of
determination, if the Line A Commitment and the Line B 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%
of the aggregate Indebtedness then evidenced by the Notes and the Swing
Line Documents.
"Managing Agents" means Bank of America, NationsBank of Texas,
N.A. and Credit Lyonnais, in each case so long as such bank is a Bank
hereunder. The Managing Agents, in such capacities, shall have no duties
under the Loan Documents beyond those of Banks.
"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 a whole, (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 or (d)
were initiated or approved by Borrower or any of its Subsidiaries and
which materially impair or are reasonably likely to materially impair
the ability of the Banks to enforce any material legal remedy pursuant
to the Loan Documents.
"Maturity Date" means April 30, 2001.
"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 project, 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 projects 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.
"Money Market Facility Lender" means, with respect to a Money
Market Facility, the financial institution that extended such Money
Market Facility to Borrower.
"Money Market Outstandings" means, as of any date of
determination, the aggregate principal amount outstanding under all
Money Market Facilities.
-17-
24
"Mortgage Company" means Xxxxxxx and Broad Mortgage Company, an
Illinois corporation and a wholly owned Financial Subsidiary of
Borrower.
"Mortgage Warehousing Agreement" means that certain Mortgage Loan
Warehousing Agreement dated as of February 24, 1997 among Mortgage
Company, the banks party thereto and NationsBank of Texas, N.A., as
agent for the banks, and as the same may from time to time be amended,
modified, refinanced or replaced.
"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 Securities Exchange 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.
"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.
"Notes" means the Line A Notes and the Line B Notes.
"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
-18-
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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) Sidley & Austin, special counsel to Borrower, and (b) Xxxxxx X.
Xxxxxxx, 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, the Managing
Agents or the Co-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:
(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
-19-
26
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 in a
shopping center or similar real property project 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;
(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;
-20-
27
(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, joint stock company, trust, estate,
unincorporated organization, union, tribe, business association or firm,
joint venture, Governmental Agency, or other entity.
"Pricing Period" means the three 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.
"Prior Loan Agreement" has the meaning set forth for that term
in the Recitals hereto.
"Projections" means the financial projections of Borrower
delivered to the Banks and dated as of March 17, 1997.
"Property" means any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"Pro Rata Share" of a Bank, as pertains to the Line A Commitment,
the Line B Commitment or the Commitments, means the applicable
percentage set forth opposite the name of that Bank on Schedule 1.1 to
this Agreement.
"Quarterly Payment Date" means June 30, 1997 and each September
30, December 31, March 31 and June 30 thereafter through and including
the Maturity Date.
"Reference Rate" means the per annum rate of interest publicly
announced from time to time by Bank of America at San Francisco,
California, as its Reference
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Rate. The Reference Rate is set by Bank of America based on various
factors, including Bank of America's costs and desired return, general
economic conditions and other factors, and is used as a reference point
for pricing loans. Bank of America may price loans at, above or below
the Reference Rate. Any change in the Reference Rate shall take effect
on the day specified in the public announcement of such change.
"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 Letter of Credit" means a written request for the
issuance of a Letter of Credit signed by a Responsible Official of
Borrower, in a form reasonably designated from time to time by the
Administrative Agent.
"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.
"Request for Redesignation of Loans" 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, the articles or
certificate of incorporation and by-laws or other organizational or
governing documents of such 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.
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"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.
"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).
"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, or (d) treasurer, in
each case whatever the title nomenclature may be, of the Person
designated.
"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 the 1997 Closing Date,
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
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(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 or years 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 in any respect 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: (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 Obligations
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.
"Swing Line" means the revolving line of credit established by
the Swing Line Bank in favor of Borrower pursuant to Section 2.4.
"Swing Line Bank" means Bank of America.
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"Swing Line Documents" means the promissory note and any other
documents executed by Borrower in favor of the Swing Line Bank in
connection with the Swing Line.
"Swing Line Loans" means loans made by the Swing Line Bank to
Borrower pursuant to Section 2.4.
"Swing Line Outstandings" means, as of any date of determination,
the aggregate principal Indebtedness of Borrower on all Swing Line Loans
then outstanding.
"Syndication Agent" means NationsBank of Texas, N.A., 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 apportionment 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.
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
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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 AND LETTERS OF CREDIT
2.1 Loans-General.
(a) Subject to the terms and conditions set forth in this
Agreement (including Section 8.2), at any time and from time to time
from the 1997 Closing Date through the Banking Day immediately preceding
the Maturity Date, each Bank shall, pro rata according to that Bank's
Pro Rata Share of the Line A Commitment then in effect, make Advances to
Borrower under the Line A Commitment in such amounts as Borrower may
request; provided that after giving effect to such Advance, (i) the
aggregate outstanding principal evidenced by the Notes plus the Letter
of Credit Usage plus the Money Market Outstandings plus Swing Line
Outstandings shall not exceed the Commitments and (ii) the aggregate
outstanding principal evidenced by the Line A Notes plus the Letter of
Credit Usage plus Swing Line Outstandings shall not exceed the Line A
Commitment. Subject to the limitations set forth herein, Borrower may
borrow, repay and reborrow under this Section 2.1(a) without premium or
penalty.
(b) Subject to the terms and conditions set forth in this
Agreement (including Section 8.2), at any time and from time to time
from the 1997 Closing Date through the Banking Day immediately preceding
the Line B Maturity Date, each Bank shall, pro rata according to that
Bank's Pro Rata Share of the Line B Commitment then in effect, make
Advances to Borrower under the Line B Commitment in such amounts as
Borrower may request; provided that after giving effect to such Advance,
(i) the aggregate outstanding principal evidenced by the Notes plus the
Letter of Credit Usage plus the Money Market Outstandings plus Swing
Line Outstandings shall not exceed the Commitments and (ii) the
aggregate outstanding principal evidenced by the Line B Notes shall not
exceed the Line B Commitment. Subject to the limitations set forth
herein, Borrower may borrow, repay and reborrow under this Section
2.1(b) without premium or penalty.
(c) Subject to the next sentence and to Sections 2.4(e) and
2.5(d), 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 in all events specify
the applicable Commitment and 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.
(d) 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
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the Loan, the applicable Interest Period in the case of an LIBOR Loan,
the applicable Commitment, 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.
(e) 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 an Alternate Base Rate Loan and (ii)
$5,000,000 if such Loan is a LIBOR Loan.
(f) 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.
(g) Borrower may redesignate an Alternate Base Rate Loan as a
LIBOR Loan, or a LIBOR Loan as an Alternate Base 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(c), 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(c), 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 Section 2.3, then Borrower shall
be deemed to have requested that such LIBOR Loan be redesignated as an
Alternate Base Rate Loan.
(h) The Advances made by each Bank under this Section 2.1 shall
be evidenced by that Bank's Line A Note or Line B Note, as applicable.
2.2 Alternate Base Rate Loans. Each request by Borrower for an
Alternate Base 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(c), 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 Alternate Base Rate Loan is to be made. The
Administrative Agent shall notify each Bank of a request for an Alternate Base
Rate Loan as soon as practicable after receipt of the same. All Loans shall
constitute Alternate Base Rate Loans unless properly designated as LIBOR Loans
pursuant to Section 2.3.
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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(c), if applicable)
received by the Administrative Agent, at the Administrative Agent's
Office, not later than 9:00 a.m., California time, at least three (3)
LIBOR Market Days before the first day of the applicable Interest
Period. 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, two (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 telex.
(c) No more than ten (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 Swing Line.
(a) The Swing Line Bank shall from time to time through the day
prior to the Maturity Date make Swing Line Loans to Borrower in such
amounts as Borrower may request, provided that (i) giving effect to such
Swing Line Loan, the Swing Line Outstandings do not exceed $15,000,000,
(ii) the conditions to an Advance specified in Article 8 have been
satisfied, (iii) without the consent of all of the Banks, no Swing Line
Loan may be made during the continuation of an Event of Default, (iv)
the Swing Line Bank has not given at least twenty-four (24) hours prior
notice to Borrower that availability under the Swing Line is suspended
or terminated and (v) after giving effect to such Swing Line Loan, (A)
the aggregate outstanding principal evidenced by the Notes plus the
Letter of Credit Usage plus the Money Market Outstandings plus the Swing
Line Outstandings shall not exceed the Commitments and (B) the aggregate
outstanding principal evidenced by the Line A Notes plus the Letter of
Credit Usage plus Swing Line Outstandings shall not exceed the Line A
Commitment. Borrower may borrow, repay and reborrow under this Section
2.4. Unless notified to the contrary by the Swing Line Bank, borrowings
under the Swing Line may be made in amounts which are integral multiples
of $100,000 upon telephonic request, and delivery of such written
request and certification as the Swing Line Bank may designate from time
to time, by a Responsible Official of Borrower made to the Swing Line
Bank not later than 4:00 p.m., Los Angeles time, on the Banking Day of
the requested borrowing (in all events, any telephonic request shall be
promptly confirmed in writing by telecopier).
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Unless notified to the contrary by the Swing Line Bank, each repayment
of a Swing Line Loan shall be in an amount which is an integral multiple
of $100,000. If Borrower instructs the Swing Line Bank to debit its
demand deposit account at the Swing Line Bank in the amount of any
payment with respect to a Swing Line Loan, or the Swing Line Bank
otherwise receives repayment, after 1:00 p.m., Los Angeles time, on a
Banking Day, such payment shall be deemed received on the next Banking
Day.
(b) Swing Line Loans shall bear interest at a fluctuating rate
per annum equal to the sum of the Alternate Base Rate plus the
Applicable Alternate Base Rate Spread, payable on the dates principal is
due and in any event on the Maturity Date. The Swing Line Bank shall be
responsible for invoicing Borrower for such interest. The interest
payable on Swing Line Loans is solely for the account of the Swing Line
Bank (or, if applicable, for the account of the Banks funding such Swing
Line Loans pursuant to Section 2.4(d)).
(c) The Swing Line Loans shall be payable on demand made by the
Swing Line Bank and in any event on the Maturity Date.
(d) Upon the making of a Swing Line Loan, each Bank shall be
deemed to have purchased from the Swing Line Bank a participation
therein in an amount equal to that Bank's Pro Rata Share of the Line A
Commitment times the amount of the Swing Line Loan. Upon demand made by
the Swing Line Bank, each Bank shall, according to its Pro Rata Share of
the Line A Commitment, promptly provide to the Swing Line Bank its
purchase price therefor in an amount equal to its participation therein.
The obligation of each Bank to so provide its purchase price to the
Swing Line Bank shall be absolute and unconditional and shall not be
affected by the occurrence of an Event of Default or any other
occurrence or event.
(e) In the event that any Swing Line Outstandings have not been
repaid by the end of the Banking Day following their disbursement, then
on the next Banking Day (unless Borrower has made other arrangements
acceptable to the Swing Line Bank to repay the Swing Line Outstandings),
Borrower shall request an Alternate Base Rate Loan under the Line A
Commitment pursuant to Section 2.2 in an amount complying with Section
2.1(e) and sufficient to repay the Swing Line Outstandings. The
Administrative Agent shall automatically provide such amount to the
Swing Line Bank (which the Swing Line Bank shall then apply to the Swing
Line Outstandings) and credit any balance of the Loan in immediately
available funds to the Designated Deposit Account. In the event that
Borrower fails to request an Alternate Base Rate Loan under the Line A
Commitment within the time specified by Section 2.2 on any such date,
the Administrative Agent may, but is not required to, without notice to
or the consent of Borrower, cause Alternate Base Rate Advances to be
made by the Banks under the Line A Commitment in the amount necessary to
comply with Section 2.1(e) and sufficient to repay the Swing Line
Outstandings and, for this purpose, the conditions precedent set forth
in Section 8.2 shall not apply. The pro-
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ceeds of such Advances shall be paid to the Swing Line Bank for
application to the Swing Line Outstandings.
2.5 Letters of Credit.
(a) Subject to the terms and conditions of this Agreement
(including Section 8.3), Borrower may request from time to time during
the period from the 1997 Closing Date through the day prior to the
Maturity Date that the Issuing Bank issue Letters of Credit for the
account of Borrower, and the Issuing Bank agrees to issue for the
account of Borrower one or more Letters of Credit, provided that (i)
Borrower shall not request that the Issuing Bank issue any Letter of
Credit if, after giving effect to such issuance, (A) the aggregate
outstanding principal evidenced by the Notes plus the Letter of Credit
Usage plus the Money Market Outstandings plus the Swing Line
Outstandings exceeds the Commitments or (B) the aggregate outstanding
principal evidenced by the Line A Notes plus the Letter of Credit Usage
plus Swing Line Outstandings exceeds the Line A Commitment, (ii)
Borrower shall not request that the Issuing Bank issue any Letter of
Credit if Borrower would not be in compliance with Sections 6.10 and
6.11, (iii) in no event shall the Issuing Bank issue any Letter of
Credit having an expiration date after the Maturity Date, (iv) the
Borrower shall not request any Letter of Credit if, after giving effect
to such issuance, the Letter of Credit Usage would exceed $100,000,000
or any limit established by Law after the 1997 Closing Date on the
Issuing Bank's ability to issue the requested Letter of Credit at any
time, and (v) prior to the issuance of any Letter of Credit the Issuing
Bank shall request confirmation by telephone from the Administrative
Agent that such Letter of Credit may be issued. Notwithstanding the
foregoing, the Issuing Bank shall not be obligated to issue a Letter of
Credit if, on or prior to the Banking Day immediately preceding the
issuance thereof any Bank has notified the Issuing Bank in writing that
the conditions set forth in Section 8.3 have not been satisfied with
respect to the issuance of such Letter of Credit.
(b) Whenever Borrower requests that the Issuing Bank issue a
Letter of Credit it shall deliver to the Issuing Bank (with a copy to
the Administrative Agent) (i) an executed application for such Letter of
Credit in the form customarily required by the Issuing Bank and a
Request for Letter of Credit by 10:00 a.m., California time, at least
three (3) Banking Days prior to the proposed date of issuance, provided
that the Issuing Bank shall use its best efforts to issue the proposed
Letter of Credit within two Banking Days after receipt of such request,
and (ii) the form of the Letter of Credit requested, together with such
other information or materials as the Issuing Bank may reasonably
request with respect to such Letter of Credit. The Administrative Agent
shall promptly thereafter notify each of the Banks of the contents of
such Request for Letter of Credit and proposed form of Letter of Credit.
Prior to the issuance of any Letter of Credit, the Issuing Bank shall
confirm by telephone with the Administrative Agent that, giving effect
to the issuance of such Letter of Credit, the limitations set forth in
Section 2.5(a) have been satisfied.
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(c) The Issuing Bank shall notify the Administrative Agent and
Borrower of each issuance or amendment of any Letter of Credit issued by
it on the Banking Day upon which such issuance or amendment occurs. Upon
the issuance of a Letter of Credit, each Bank (other than the Issuing
Bank and any Bank that has notified the Issuing Bank pursuant to the
last sentence of Section 2.5(a) with respect to such Letter of Credit)
shall be deemed to have purchased a pro rata participation from the
Issuing Bank in an amount equal to that Bank's Pro Rata Share of the
Line A Commitment, of the face amount of such Letter of Credit. Without
limiting the scope and nature of each such Bank's participation in any
Letter of Credit, to the extent that the Issuing Bank has not been
reimbursed for any payment required to be made by the Issuing Bank under
any Letter of Credit by the Banks through the making of an Alternative
Base Rate Loan in accordance with Section 2.5(d) or by the Borrower in
accordance with Section 2.5(e), each such Bank shall, according to its
Pro Rata Share of the Line A Commitment, immediately reimburse the
Issuing Bank upon demand for the amount of such payment. If any Bank
fails to reimburse the Issuing Bank in the manner required by this
Section on the same day upon which the related payment has been made by
the Issuing Bank, that Bank shall also pay interest to the Issuing Bank
on the amount of such reimbursement obligations at the Federal Funds
Rate for the first two days after payment has been made by the Issuing
Bank and at a rate equal to the sum of the Federal Funds Rate plus 2%
from and after the third day after the date such payment was made (which
interest shall not be for the account of or otherwise reimbursable by
Borrower). The obligation of each such Bank to so reimburse the Issuing
Bank shall be absolute and unconditional and shall not be affected by
(i) the occurrence of an Event of Default or a Default, (ii) any
set-off, counterclaim, defense or other right that such Bank or Borrower
may have against the Issuing Bank, Borrower or any other Person, (iii)
any adverse change in the condition (financial or otherwise) of Borrower
or (iv) any other occurrence or event. Any such reimbursement shall not
relieve or otherwise impair the obligation of Borrower to reimburse the
Issuing Bank under any Letter of Credit together with interest as
hereinafter provided.
(d) The Issuing Bank shall provide notice to Borrower and the
Administrative Agent of the amount of each demand for a draw under any
Letter of Credit and, where practicable, such notice may be provided on
the Banking Day immediately preceding the Banking Day of an expected
payment. If all of the limitations and requirements set forth in this
Agreement with respect to the making of an Alternate Base Rate Loan
under the Line A Commitment (except the requirement that a Request for
Loan be made as and when specified herein) have been satisfied then the
Banks shall be obligated to make an Alternate Base Rate Loan to Borrower
(without notice to or the consent of the Borrower) under the Line A
Commitment in an aggregate amount equal to the amount paid by the
Issuing Bank on the related Letter of Credit. The Administrative Agent
shall thereupon promptly provide notice of such payment under the Letter
of Credit to the Banks, and within one Banking Day after such notice
from the Administrative Agent, each Bank shall make its Pro Rata Share
of such Alternate Base Rate Loan under the Line A Commitment (plus
interest at the
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Federal Funds Rate for the first two days after the date payment has
been made by the Issuing Bank and at a rate equal to the sum of the
Federal Funds Rate plus 2% from and after the third day after the date
such payment has been made by the Issuing Bank, which interest shall not
be for the account of or otherwise reimbursable by Borrower) available
to the Administrative Agent for the account of the Issuing Bank in
immediately available funds, and such funds shall collectively
constitute the aforementioned Alternate Base Rate Loan, the proceeds of
which shall be paid to the Issuing Bank to reimburse it for the payment
made by it under the Letter of Credit.
(e) In the event that not all of the limitations and requirements
set forth in this Agreement with respect to the making of an Alternative
Base Rate Loan under the Line A Commitment (other than the requirement
that a Request for Loan be made as and when specified herein) have been
satisfied, then Borrower agrees to pay to the Issuing Bank an amount
equal to the amount of the applicable demand for a draw under a Letter
of Credit (i) on the same Banking Day any payment is made, if the
Issuing Bank notifies Borrower of such payment prior to 12:00 p.m.,
California time, on the Banking Day immediately preceding the Banking
Day upon which such payment is to be made or (ii) on the Banking Day
immediately following the Banking Day of the payment, if later notice is
given. The principal amount of any such payment made by Borrower to the
Issuing Bank shall be used to reimburse the Issuing Bank for the payment
made by it under the Letter of Credit. In the event that Borrower does
not make such payment when due, Borrower shall also pay interest to the
Administrative Agent for the account of the Banks on such amount from
the date of any payment to, but not including, the date of payment by
Borrower at the rate provided for in Section 3.8; provided that not less
than one day's interest shall be due. Each Bank that has reimbursed the
Issuing Bank pursuant to Section 2.5(c) in accordance with its Pro Rata
Share of the Line A Commitment of any payment made by the Issuing Bank
under a Letter of Credit shall thereupon acquire a pro rata
participation, to the extent of such reimbursement, in the claim of the
Issuing Bank against Borrower under this Section 2.5(e).
(f) Subject to Section 3.18, Borrower agrees to pay to the
Administrative Agent (which shall promptly pay the same to the Banks or
the Issuing Bank, as the case may be), (i) for the account of the Banks
(other than a Bank that has notified the Issuing Bank pursuant to the
last sentence of Section 2.5(a) with respect to such Letter of Credit)
with respect to each Letter of Credit, a per annum letter of credit fee
in an amount equal to the Applicable Letter of Credit Fee times the face
amount of such Letter of Credit (including increases in the undrawn face
amount thereof) for the term of such Letter of Credit, and (ii) for the
account of the Issuing Bank with respect to each Letter of Credit, an
issuance fee in an amount equal to the greater of $500 or one eighth
percent (1/8%) per annum times the face amount of such Letter of Credit
(including increases in the undrawn face amount thereof) for the term of
such Letter of Credit, together with the Issuing Bank's standard charges
and actual and reasonable out-of-pocket costs in connection with such
issuance. The letter of credit fees for each Letter of Credit are
payable in advance for each six month period (or portion thereof)
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during the term of the applicable Letter of Credit, on the issuance date
and on each six month anniversary thereof during the term the applicable
Letter of Credit is outstanding. In the event a Letter of Credit is
canceled or terminated prior to its original expiration date, the fee
provided for in clause (i) of the first sentence in this subsection (f)
shall be refundable by the Banks on a pro rata basis over the period
such Letter of Credit will no longer be outstanding, and one-half of the
issuance fee referred to in clause (ii) of the first sentence in this
subsection (f) shall be refundable by the Issuing Bank over the period
such Letter of Credit will no longer be outstanding (and the balance
will be non-refundable).
(g) The obligation of Borrower to reimburse the Issuing Bank for
drawings or payments made under each Letter of Credit shall be
unconditional and irrevocable. Without limiting the foregoing, such
obligation of Borrower shall not be affected by any of the following
circumstances:
(i) any lack of validity or enforceability of the Letter
of Credit, this Agreement, or any letter of credit application or
other agreement or instrument relating thereto;
(ii) compliance by the Issuing Bank with any amendment or
waiver of or any consent to departure from the Letter of Credit,
this Agreement or any letter of credit application or other
agreement or instrument relating thereto previously approved by
Borrower pursuant to Section 2.5(b);
(iii) the existence of any claim, setoff, defense, or
other rights which Borrower may have at any time against any
Bank, any beneficiary of the Letter of Credit (or any Persons for
whom any such beneficiary may be acting) or any other Person,
whether in connection with the Letter of Credit, this Agreement,
or any letter of credit application or other agreement or
instrument relating thereto, or any unrelated transactions;
(iv) any demand, statement, or any other document
presented under a Letter of Credit proving to be forged,
fraudulent, invalid, or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect
whatsoever so long as any such document appeared to comply with
the terms of the Letter of Credit;
(v) the solvency or financial responsibility of any party
issuing any documents in connection with a Letter of Credit;
(vi) any failure or delay in notice of shipments or
arrival of any property;
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(vii) any error in the transmission of any message
relating to a Letter of Credit not caused by the Issuing Bank, or
any delay or interruption in any such message;
(viii) any error, neglect or default of any correspondent
of any Bank in connection with a Letter of Credit;
(ix) any consequence arising from acts of God, war,
insurrection, disturbances, labor disputes, emergency conditions
or other causes beyond the control of the Banks;
(x) the form, accuracy, genuineness or legal effect of any
contract or document referred to in any document submitted to the
Issuing Bank in connection with a Letter of Credit so long as the
Issuing Bank in good faith determines that the draft or document
appears to comply with the terms of the Letter of Credit; and
(xi) where the Issuing Bank has acted in good faith and
without gross negligence and observed general banking usage, any
other circumstance whatsoever. IN DETERMINING WHETHER TO PAY
UNDER ANY LETTER OF CREDIT, THE ISSUING BANK SHALL BE RESPONSIBLE
ONLY TO DETERMINE THAT THE DOCUMENTS AND CERTIFICATES REQUIRED TO
BE DELIVERED UNDER THAT LETTER OF CREDIT HAVE BEEN DELIVERED AND
THAT THEY COMPLY ON THEIR FACE WITH THE REQUIREMENTS OF THAT
LETTER OF CREDIT AND THE ISSUING BANK SHALL OBTAIN THE CONSENT OF
THE BORROWER PRIOR TO MAKING ANY PAYMENT WITH RESPECT TO ANY
DOCUMENT OR CERTIFICATE WHICH DOES NOT SO COMPLY ON ITS FACE.
(h) Borrower shall initially request all Letters of Credit from
Bank of America, as Issuing Bank (provided that the foregoing shall not
limit Borrower's ability to request letters of credit that are not
Letters of Credit from any issuing bank). In the event that (i) a
prospective beneficiary will not accept Bank of America as the Issuing
Bank with respect to the requested Letter of Credit, or (ii) Bank of
America is otherwise unable to issue a properly requested Letter of
Credit to which Borrower is entitled hereunder or (iii) Bank of America
is unwilling, after reasonable opportunity to do so, to issue a properly
requested Letter of Credit to which Borrower is entitled hereunder in
the form requested by Borrower, then, upon prior notice to the
Administrative Agent, Borrower may select an additional "Issuing Bank"
from among the Banks holding a portion of the Line A Commitment (with
such additional Issuing Bank's approval) to issue the requested Letter
of Credit.
(i) The Issuing Bank shall be entitled to the protections
accorded to the Administrative Agent pursuant to Article 10, mutatis
mutandis.
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2.6 Reduction of Commitments/Extension of Line B Maturity Date
(a) Borrower shall have the right, at any time and from time to
time, without penalty or charge, upon at least (5) Banking Days prior
written notice voluntarily to reduce or terminate permanently and
irrevocably, in aggregate principal amounts in an integral multiple of
$1,000,000 but not less than $5,000,000 (unless all the unused
Commitments are being terminated), all or a portion of the unused Line A
Commitment or the unused Line B Commitment. Borrower shall pay to the
Administrative Agent on the date of such termination all unpaid
commitment fees which have accrued to such date in respect of the
terminated portion of the applicable Commitment.
(b) No earlier than 90 days nor later than 70 days prior to any
Line B Maturity Date, Borrower may make a written request to the
Administrative Agent and to each of the Banks to extend the then
approaching Line B Maturity Date for a period of an additional 364 days
(but in no event beyond the Maturity Date). If written consent to such
extension request is given by the Majority Banks to the Administrative
Agent within 45 days of such request by Borrower, then the Line B
Maturity Date shall be extended as so requested provided, however, that
if less than 100% of the original Line B Commitment is retained by
consenting Banks (either under this clause (b) or clause (c), below)
then Borrower shall have the option, to be exercised by written notice
received by the Administrative Agent no fewer than three (3) Banking
Days prior to the then approaching Line B Maturity Date, to convert the
Line B loans to a term loan pursuant to clause (e), below.
(c) In the event that a request to extend a Line B Maturity Date
under clause (b), above, is approved by the Majority Banks but less than
all of the Banks, then, subject to clause (e), below, the portion of the
Line B Commitment attributable to the Banks that did not grant consent
to such extension (each, a "Non-Consenting Bank") shall terminate unless
all or any part of such portion of the Line B Commitment is assumed by
one or more of the Banks that consented to such extension pursuant to
Section 11.8. Any such consenting Bank may request, at any time prior to
ten (10) days prior to the then approaching Line B Maturity Date, to
assume a portion of such Line B Commitment to the Administrative Agent,
and the Administrative Agent will coordinate an allocation of such Line
B Commitment among Banks expressing an interest therein, which, if
oversubscribed, shall be allocated in proportion to such requesting
Banks' existing Pro Rata Shares of the Line B Commitment. Any such
termination or reallocation of the Line B Commitment shall become
effective immediately following the superseded Line B Maturity Date and
shall be evidenced by (i) a revised version of Schedule 1.1 hereto
prepared by the Administrative Agent and delivered to Borrower and each
of the Banks and (ii) replacement of Line B Notes delivered by Borrower
to the Administrative Agent for distribution to the applicable Banks in
exchange for the existing Line B Notes.
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(d) In the event that a portion of the Line B Commitment is
terminated pursuant to the terms of clause (c), above, Borrower may,
within 120 days after such termination request that one or more Persons
that are Eligible Assignees (each, a "New Bank") and that are approved
by the Administrative Agent (which approval shall not be unreasonably
withheld):
(i) purchase all (but not part) of any Non-Consenting
Bank's then outstanding Advances, its Notes and its participation
interest in outstanding Letters of Credit, and assume its Pro
Rata Share of the Commitments and its obligations hereunder. If
one or more New Banks so agree in writing, the Non-Consenting
Bank shall assign its Pro Rata Share of the Commitments, together
with the Indebtedness then evidenced by its Notes and its
participation interest in outstanding Letters of Credit, to the
New Bank or New Banks in accordance with Section 11.8. On the
date of any such assignment, the Non-Consenting Bank which is
being so replaced shall cease to be a "Bank" for all purposes of
this Agreement and shall receive (A) from the New Bank or New
Banks the principal amount of its Advances then outstanding and
(B) 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. In the event the
Non-Consenting Bank is also an Issuing Bank, then the New Bank
shall become an Issuing Bank for all purposes of this Agreement
and shall either (at the Non-Consenting Bank's election, subject
to the approval of Borrower, the Administrative Agent and the New
Bank (which approvals shall not be unreasonably withheld) and, in
the case of clause (x) below, the approval of the applicable
Letter of Credit beneficiaries) (x) issue new letters of credit
to replace the outstanding Letters of Credit issued by the
Non-Consenting Bank, or (y) issue new letters of credit to the
Non-Consenting Bank in support of the outstanding Letters of
Credit issued by the Non-Consenting Bank, whereupon such
outstanding Letters of Credit shall no longer be considered
"Letters of Credit" under this Agreement, and such new letters of
credit shall be considered Letters of Credit for all purposes of
this Agreement (including the participation therein by the other
Banks pursuant to Section 2.5). The Non-Consenting Bank shall be
obligated to reimburse to Borrower a portion of the issuance fees
referred to in clause (ii) of the first sentence of Section
2.5(f) based on the period during which each new Letter of Credit
issued by the New Bank will be outstanding in replacement or
support of a Letter of Credit issued by the Non-Consenting Bank;
and/or
(ii) provide all or any portion of the original Line B
Commitment that was terminated in accordance with clause (c)
above. Any such assumption by a New Bank shall be evidenced by an
appropriately modified version of Exhibit A hereto executed by
the New Bank, Borrower and the Administrative Agent and shall
result in (A) the Line B Commitment being increased by the amount
so assumed (but not to a level in excess of
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$100,000,000) and (B) such New Bank becoming a Bank for all
purposes hereunder and holding the assumed Pro Rata Share of the
Line B Commitment.
Any such purchase or assumption by a New Bank pursuant to clause (i) or
(ii) of this Section 2.6(d) shall be further evidenced by a revised
version of Schedule 1.1 hereto prepared by the Administrative Agent and
delivered to Borrower and each of the Banks and replacement Line A
and/or Line B Notes delivered by Borrower to the Administrative Agent
for distribution to the applicable Banks in exchange for the
corresponding existing Line A and/or Line B Notes.
(e) In the event that (i) Borrower does not request an extension
of a Line B Maturity Date, (ii) a request by Borrower for extension of a
Line B Maturity Date is not approved by the Majority Banks or (iii) a
request by Borrower for extension of a Line B Maturity Date is approved
by the Majority Banks, but a portion of the Line B Commitment is to be
terminated pursuant to clause (c), above, Borrower shall have the right
to elect, by written notice to the Administrative Agent no later than
three (3) Banking Days prior to such Line B Maturity Date, to have the
outstanding balance of the Line B Notes on such Line B Maturity Date
converted to a term loan under the Line B Commitment which term loan
shall become due and payable in full on the Maturity Date. In the event
of such a conversion, Borrower's right to reborrow under the Line B
Commitment and the unused commitment fees for the Line B Commitment
under Section 3.3(b) shall both terminate as of the Line B Maturity
Date.
2.7 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 any 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 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 a 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.
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Article 3
PAYMENTS; FEES
3.1 Principal and Interest
(a) Interest shall be payable on the outstanding daily unpaid
principal amount of each Loan from the date thereof 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 Alternate Base Rate Loan shall be
due and payable on the last day of each calendar month. Except as
otherwise provided in Section 3.8, the unpaid principal amount of any
Alternate Base Rate Loan shall bear interest at a fluctuating rate per
annum equal to the sum of the Alternate Base Rate plus the Applicable
Alternate Base Rate Spread. Each change in the interest rate hereunder
shall take effect simultaneously with the corresponding change in the
Alternate Base Rate. Each change in the Alternate Base Rate shall be
effective as of the Banking Day on which the change in the Alternate
Base 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 which has an Interest
Period of three months or less shall be due and payable on the last day
of the related Interest Period. Interest accrued on each other LIBOR
Loan shall be due and payable on the date which is three months after
the date such LIBOR Loan was made, every three months thereafter and on
last day of the related Interest Period. Except as otherwise provided in
Section 3.8, 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 payable as follows:
(i) the principal Indebtedness evidenced by the Notes
shall be payable within one (1) Banking Day in Cash to the extent
that the sum of (A) the aggregate principal Indebtedness
evidenced by the Notes plus (B) the Letter of Credit Usage plus
(C) the Money Market Outstandings plus (D) the Swing Line
Outstandings exceeds at any time the Commitments as then in
effect;
(ii) unless a conversion of the Indebtedness evidenced by
the Line B Notes to term Indebtedness has been effected pursuant
to Section 2.6(e), the principal Indebtedness evidenced by the
Line B Notes and
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all accrued interest thereon shall be immediately payable in
Cash on the Line B Maturity Date and, with respect to any
portion of the Line B Notes which is not being extended, on the
day immediately prior to the commencement of any extension of
the Line B Maturity Date pursuant to the terms of Section 2.6;
and
(iii) the principal Indebtedness evidenced by the Notes
shall in any event 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 an Alternate Base Rate Loan,
and not less than $5,000,000 on a LIBOR Loan, (iii) the Administrative
Agent must have received written notice (or telecopied 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 an
Alternate Base Rate Loan, (iv) each prepayment of principal, except for
partial prepayments on Alternate Base 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 3.7.
(f) Change in Control.
(i) If a Change in Control (as defined below) 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, and deliver to
the Administrative Agent an amount equal to the Letter of Credit
Usage then outstanding, to be held as cash collateral as provided
in Section 9.2(c) (the "Change in Control Repayment"), on the
date that is 27 Banking Days after the occurrence of the Change
of Control (the "Change of 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 Commitments shall automatically terminate.
A "Change in Control" 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 (as defined below) would be
converted into Cash, securities or other
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property, other than a merger of Borrower in which
the holders of Voting Stock immediately prior to
the merger have the same or greater proportionate
ownership, directly or indirectly, of the Voting
Stock of the surviving corporation immediately
after such merger as they had of the Voting Stock
immediately prior to such merger; 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 Securities Exchange Act of 1934
(the "Exchange Act"), disclosing that such person
(for the purposes of this Section 3.1(f) 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
(as defined below) 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 an indenture or agreement governing any
Subordinated Obligation occurs.
Notwithstanding the foregoing provisions of this Section
3.1(f), 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
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beneficial ownership by it of shares of Voting Stock, whether in
excess of 50% or otherwise.
"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).
"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.
(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 and cash collateral shall be
provided for the Letter of Credit Usage 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, and the Commitments shall
terminate.
3.2 Upfront Fee. In addition to fees specified in the agency
letters referred in Section 3.5, on the 1997 Closing Date, Borrower shall pay to
the Administrative Agent, for the account of each Bank pro rata according to
that Bank's Pro Rata Share of the Commitments, an upfront fee of 0.05% (5 basis
points) of the Commitments.
3.3 Commitment Fees.
(a) From the 1997 Closing Date until the Maturity Date, Borrower
shall pay to the Administrative Agent, for the account of each Bank, pro
rata according to
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that Bank's Pro Rata Share of the Line A Commitment, a commitment fee
equal to the Applicable Line A Commitment Fee Rate per annum in effect
from time to time times the average daily amount by which the Line A
Commitment exceeds the aggregate outstanding principal of the Loans
evidenced by the Line A Notes plus the Letter of Credit Usage plus the
Swing Line Outstandings. This commitment fee shall accrue daily and be
payable in arrears with respect to each calendar quarter on the
Quarterly Payment Date falling at the end of such calendar quarter. The
Administrative Agent shall calculate the commitment fee and the amount
thereof allocable to each Bank according to that Bank's Pro Rata Share
of the Line A Commitment and shall notify Borrower in writing of such
amounts.
(b) From the 1997 Closing Date until the Line B Maturity Date,
Borrower shall pay to the Administrative Agent, for the account of each
Bank, pro rata according to that Bank's Pro Rata Share of the Line B
Commitment, a commitment fee equal to the Applicable Line B Commitment
Fee Rate per annum in effect from time to time times the average daily
amount by which the Line B Commitment exceeds the aggregate outstanding
principal of the Loans evidenced by the Line B Notes. This commitment
fee shall accrue daily and be payable in arrears with respect to each
calendar quarter on the Quarterly Payment Date falling at the end of
such calendar quarter. The Administrative Agent shall calculate the
commitment fee and the amount thereof allocable to each Bank according
to that Bank's Pro Rata Share of the Line B Commitment and shall notify
Borrower in writing of such amounts.
3.4 Advance Fees. On the date of each Loan under the Line B
Commitment that results in an increase in the outstanding principal balance
under the Line B Notes, Borrower shall pay to the Administrative Agent, for the
account of each Bank, pro rata according to that Bank's Pro Rata Share of the
Line B Commitment, an advance fee equal to the Applicable Advance Fee Rate times
the amount of the Line B Loan being made on that date times 25%. No advance fee
shall be payable at the time of any extension of the Line B Maturity Date
pursuant to Section 2.6(c) with respect to any portion of the principal balance
outstanding under the Line B Commitment immediately prior to such extension that
remains outstanding immediately following such extension.
3.5 Agency Fees. Borrower shall pay to the Administrative Agent
and to each other Managing Agent, for the account solely of such Managing Agent,
such agency fees as are set forth in separate letter agreements.
3.6 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 1997 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
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consequence of, or with reference to, such Affected Bank's Pro Rata
Share of the Commitments 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 3.6 (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
3.6(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 3.6(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 3.6(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 Notes and its participation interest in outstanding
Letters of Credit, and assume its Pro Rata Share of the Commitments 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
Commitments, together with the Indebtedness then evidenced by its Notes
and its participation interest in outstanding Letters of Credit, 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
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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. In the event the Affected Bank is
also an Issuing Bank, then the Assuming Bank shall become an Issuing
Bank for all purposes of this Agreement and shall either (at the
Affected Bank's election, subject to the approval of Borrower, the
Administrative Agent and the Assuming Bank (which approvals shall not be
unreasonably withheld) and, in the case of clause (i) below, the
approval of the applicable Letter of Credit beneficiaries) (i) issue new
letters of credit to replace the outstanding Letters of Credit issued by
the Affected Bank, or (ii) issue new letters of credit to the Affected
Bank in support of the outstanding Letters of Credit issued by the
Affected Bank, whereupon such outstanding Letters of Credit shall no
longer be considered "Letters of Credit" under this Agreement, and such
new letters of credit shall be considered Letters of Credit for all
purposes of this Agreement (including the participation therein by the
other Banks pursuant to Section 2.5). The Affected Bank shall be
obligated to reimburse to Borrower a portion of the issuance fees
referred to in clause (ii) of the first sentence of Section 2.5(f) based
on the period during which each new Letter of Credit issued by the
Assuming Bank will be outstanding in replacement or support of a Letter
of Credit issued by the Affected Bank.
3.7 LIBOR Fees and Costs.
(a) If the occurrence of any Regulatory Development after the
1997 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;
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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 3.7(d), pay in full the
affected LIBOR Advances of such Bank or request that such LIBOR Advances
be converted to Alternate Base Rate Advances.
(b) If after the 1997 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
Alternate Base 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
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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 3.7(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
an Alternate Base Rate Advance for the same period of time, and such
amount shall be treated in all respects as an Alternate Base 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 an Alternate Base Rate Loan.
(d) Upon payment or prepayment of any LIBOR Advance (other than
as the result of a conversion required under Section 3.7(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
(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
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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 3.7(d) shall be conclusive in
the absence of manifest error.
(e) Any statement or certificate given by a Bank under this
Section 3.7 shall satisfy the requirements set forth in Section 3.7(c)
with respect to requests for reimbursement under Section 3.7(a)
(f) Should any Bank demand payment under the provisions of
Section 3.7(a) or should any Bank's LIBOR Advances be suspended under
the provisions of Section 3.7(b), then without limiting its obligation
to reimburse any Bank for compensation claimed by such Bank pursuant to
this Section 3.7, Borrower may, within 60 days following such
occurrence, treat that Bank as an "Affected Bank" under Section 3.6(d),
and exercise the remedies set forth in such Section 3.6(d).
3.8 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
Alternate Base Rate plus the Applicable Alternate Base 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 Alternate Base Rate plus the Applicable
Alternate Base 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.
3.9 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.
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3.10 Holidays. If any principal payment to be made by Borrower on
an Alternate Base Rate Loan shall come due on a day other than a Banking Day,
payment shall be made on the next succeeding 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.
3.11 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 1997 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 3.11(a), Borrower may, within 60 days
following any such payment by that Bank, treat that Bank as an "Affected
Bank" under Section 3.6(d), and exercise the remedies set forth in such
Section 3.6(d).
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3.12 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.
3.13 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 limit or be deemed a waiver of any
right of Borrower to protest or dispute the payment amount of such fee or costs.
3.14 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 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 a Default or 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(e).
3.15 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
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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. In furtherance of the
foregoing, Borrower hereby authorizes the Administrative Agent, through Bank of
America, to automatically debit the Designated Deposit Account (or, upon notice
to Borrower, any other deposit account maintained by Borrower with Bank of
America) for payments as and when due hereunder.
3.16 Survivability. All of Borrower's obligations under this
Article 3 shall survive for six months following the date on which all Loans
hereunder were fully paid.
3.17 Bank Calculation Certificate. Any request for compensation
pursuant to Section 3.6 or 3.7 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 3.6 hereof shall be consistent with the methodology used by such
Bank in making similar calculations in respect of loans or commitments to other
borrowers.
3.18 Transition.
(a) Borrower warrants and covenants that as of the 1997 Closing
Date there will be no loans of any nature outstanding under the Prior
Loan Agreement. The parties hereto agree that as of the 1997 Closing
Date all commitments to extend credit under the Prior Loan Agreement
shall terminate.
(b) The letters of credit identified on Schedule 3.18 ("Existing
Letters of Credit") were issued by Bank of America for the account of
Borrower as "Line A Letters of Credit" pursuant to the terms of the
Prior Loan Agreement and are expected to remain outstanding on the 1997
Closing Date. The parties hereto agree that the Existing Letters of
Credit shall be deemed for all purposes to be Letters of Credit issued
pursuant to the terms of Section 2.5; provided that fees with respect
thereto shall be governed by Section 3.18(c).
(c) A letter of credit fee and an issuance fee has most recently
been paid by Borrower with respect to each Existing Letter of Credit
(pursuant to Section 2.5(g) of the Prior Loan Agreement) as shown on
Schedule 3.18. These fees are applicable to the six-month period from
and after their respective dates of payment. No further letter of credit
or issuance fee shall be due with respect to any Existing Letter of
Credit that expires or is drawn in full prior to the end of such
applicable six-month period. From and after the end of each such
applicable six-month period, Borrower shall be responsible to pay letter
of credit fees, issuance fees and other fees pursuant to Section 2.5(f)
of this Agreement for each Existing Letter of Credit that has not
expired or been drawn in full before that date.
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(d) The Banks hereby agree to make appropriate adjustments among
themselves with respect to the letter of credit fees paid with respect
to the Existing Letters of Credit within six (6) months prior to the
1997 Closing Date. Such adjustments shall be as of the 1997 Closing Date
and shall be based upon any change in the pro rata share held by each
such Bank in the Line A Commitment under this Agreement from the pro
rata share held by each such Bank in the Line A Commitment under the
Prior Loan Agreement. The Administrative Agent shall, within 15 days of
the 1997 Closing Date, send a settlement billing to each Bank with
respect to such adjustments, which settlement billing shall be
conclusive in the absence of manifest error.
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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 or bylaws;
(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;
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(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;
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 1997 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
1997 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 1997 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
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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.
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, 1996 and for the Fiscal
Year then ended; and
(b) the unaudited consolidating financial statements of Borrower
and its Consolidated Subsidiaries as at November 30, 1996 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, 1996. Since November 30, 1996, 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 1997 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
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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 now 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 1997 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.
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 1997 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
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made or accrued in the balance sheet of Borrower and its Consolidated
Subsidiaries as at November 30, 1995. 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.
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 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. As of the 1997 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 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 1997
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 Commitments 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
Sections 6.2 or 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 (subject to deductibles and retentions that
are
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reasonable and, if reasonably available, at least as protective as recent
historical practices of Borrower) and against such risks as is usually carried
by responsible companies of similar size engaged in similar businesses and
owning similar assets in the general areas in which Borrower and its
Subsidiaries operate.
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 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 reasonably possible.
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 Commitments 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.
6.2 Dispositions. Make any Disposition, except (a) a Disposition
to Borrower or to a wholly-owned Subsidiary of Borrower and (b) a Disposition of
a Foreign Subsidiary that does not hold a majority of its assets in the Republic
of France.
6.3 Mergers and Sale of Assets. Merge or consolidate with or into
any Person, or sell all or substantially all of its 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
wholly-owned Subsidiary of Borrower;
(c) liquidations of any Subsidiary of Borrower into Borrower or
into a wholly-owned Subsidiary of Borrower;
(d) a merger of Borrower or one of its Subsidiaries with another
Person if (i) Borrower or such Subsidiary is the corporation surviving
such merger and (ii) immediately after giving effect to such merger, no
Default or Event of Default shall have occurred and be continuing; or
(e) Dispositions permitted under Section 6.2.
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:
(a) Investments consisting of Cash or Cash Equivalents;
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(b) advances to employees of Borrower or its Subsidiaries for
travel, housing expenses, 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;
(e) Acquisitions and Investments by the Mortgage Company
permitted under the Mortgage Warehousing Agreement;
(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 after November 30, 1996 does not exceed $5,000,000 in
the aggregate; and
(g) Investments in existence on the 1997 Closing Date disclosed
on Schedule 6.4;
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
$5,000,000.
6.6 Change in Business. Engage in any business other than the
businesses as now conducted by Borrower or its Subsidiaries, and any business
reasonably related to such businesses.
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:
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(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 1997 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 300% of
the aggregate Indebtedness so secured.
(d) Liens consisting of a Capital Lease covering personal
Property;
(e) Permitted Encumbrances;
(f) 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 $10,000,000 and are being
contested in good faith by appropriate proceedings timely commenced and
diligently prosecuted;
(g) Liens existing on any asset of any Person at the time such
Person becomes a Subsidiary and not created in contemplation of such
event;
(h) 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;
(i) 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;
(j) 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;
(k) Liens arising in the ordinary course of business which (i) do
not secure Indebtedness, (ii) do not secure any obligation in an amount
exceeding $200,000 individually, or $500,000 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;
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(l) Liens not otherwise permitted by the foregoing clauses of
this Section which secure Indebtedness not exceeding $500,000 in the
aggregate;
(m) 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, 1996 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
$10,000,000 plus the amount by which aggregate Indebtedness then secured
by Liens described in Section 6.7(c) is less than $100,000,000;
(n) 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
(o) 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, or (b) a transaction between or among
Borrower and its wholly-owned Subsidiaries, or (c) a transaction that has been
approved by a resolution adopted 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, or (d) an arm's length 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.
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) $300,000,000, plus (b) an amount equal to 50% of aggregate of Consolidated
Net Income for each Fiscal Quarter contained in the fiscal period commencing on
December 1, 1996 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 November 30, 1996, minus (d) the cumulative cost to Borrower
for the repurchase, if any, of its capital stock subsequent to November 30, 1996
(provided that such deduction shall have an aggregate cap of $40,000,000 for the
measurement at the end of any Fiscal Quarter in the Fiscal Year ending November
30, 1997, $30,000,000 for the measurement at the end of any Fiscal Quarter in
the Fiscal Year ending November 30, 1998 and $20,000,000 for the measurement at
the end of any Fiscal Quarter in any Fiscal Year thereafter).
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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 a portion of the Commitments of $30,000,000
or more is used to finance Acquisitions during any three consecutive
Fiscal Quarters 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 the three (3) consecutive Fiscal
Quarters next ending after such Acquisition, provided that (i) an
increase under this clause (a) has not been in effect with respect to
any of the four (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 four (4) Fiscal Quarters and (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);
(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 two (2) consecutive Fiscal Quarters, provided that (i)
this clause (b) has not been in effect with respect to any of the four
(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
two (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 2.25 to 1.00 (if such Fiscal Quarter ends on or
before November 30, 1997) or 2.50 to 1.00 (if such Fiscal Quarter ends
after November 30, 1997) 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.
6.11 Consolidated Interest Coverage Ratio. Permit the
Consolidated Interest Coverage Ratio to be, at the end of any Fiscal Quarter,
less than the ratio set forth below opposite that Fiscal Quarter:
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Fiscal Quarters Ending Ratio
---------------------- -----
From the Closing Date
through November 30, 1997 2.00 to 1.00
After November 30, 1997 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 two (2) Fiscal Quarters
provided that (a) an adjustment under this Section 6.11 has not been in effect
with respect to any of the four (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 four
(4) Fiscal Quarters. Subject to satisfaction of the foregoing conditions, the
decrease in the ratio for the first Fiscal Quarter shall be to 1.50 to 1.00 (if
the request applies to a Fiscal Quarter ending on or before November 30, 1997)
or to 1.75 to 1.00 (if the request applies to a Fiscal Quarter ending after
November 30, 1997) and the decrease for the second Fiscal Quarter shall be to a
level (in no event higher than 2.00:1.00 or 2.25:1.00, as applicable) that is
0.25 higher than the actual Consolidated Interest Coverage Ratio for such first
Fiscal Quarter (e.g., from 1.60 to 1.00 improving to at least 1.85 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.
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6.16 Certain Investments. Make any Investment (a) in any Foreign
Subsidiary, (b) in any Financial Subsidiary, (c) in any Person that is not a
wholly owned Subsidiary of Borrower (collectively, "Specified Entities") if,
giving effect thereto, the aggregate amount of all such Investments made after
November 30, 1996 exceeds the sum of (i) $30,000,000 plus (ii) the aggregate
amount of Cash Distributions declared and paid by all Specified Entities to
Borrower after November 30, 1996, plus (iii) the aggregate amount of capital of
Specified Entities returned to Borrower after November 30, 1996.
6.17 Money Market Indebtedness. 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 plus the Letter of Credit Usage plus
the Money Market Outstandings plus the Swing Line Outstandings to exceed the
Commitments.
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.
6.19 Future Subsidiaries. Permit, as of the last day of any
Fiscal Quarter, the total assets of all Subsidiaries of Borrower (other than
Guarantor Subsidiaries, Financial Subsidiaries and Foreign Subsidiaries) that
are formed after the 1997 Closing Date to exceed 10% of the consolidated total
assets (other than assets of Financial Subsidiaries or Foreign Subsidiaries) of
Borrower and its Subsidiaries as of such date.
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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 Commitments 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 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
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 standing selected
by Borrower (to which the Majority Banks have not reasonably objected),
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) not approved by the
Majority Banks in their reasonable
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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. 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 $5,000,000) 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;
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(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 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 sixty (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 two
(2) Fiscal Years;
(k) Promptly following obtaining knowledge thereof by a Senior
Officer of Borrower, written notice 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) 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 (c) 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
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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. The effectiveness of this Agreement, and
obligations of the Banks to make the initial Advances and of the Issuing Bank to
issue the initial Letter of Credit are subject to the following conditions, each
of which shall be satisfied prior to or concurrently with the making of the
initial Advances:
(a) The Administrative Agent shall have received all of the
following, each dated as of the 1997 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 Line A Note and a Line B Note executed by Borrower
in favor of each Bank, each in a principal amount equal to that
Bank's Pro Rata Share of the applicable Commitment. Promptly
following the 1997 Closing Date, the promissory notes delivered
to the Banks pursuant to the Prior Loan Agreement shall be
canceled and promptly returned to Borrower;
(iii) the Subsidiary Guaranty executed by each Subsidiary
which is a Guarantor Subsidiary as of the 1997 Closing Date;
(iv) the Swing Line Documents, executed by Borrower;
(v) with respect to Borrower and each Subsidiary which is
a Guarantor Subsidiary as of the 1997 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;
(vi) the Opinions of Counsel;
(vii) 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;
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(viii) a side letter executed by each "Bank" under the
Prior Loan Agreement that is not a "Bank" hereunder acknowledging
a termination of the "Commitments" under the Prior Loan Agreement
and agreeing to the other matters specified in Section 3.18; and
(ix) 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 letter agreements referred to
in Section 3.5 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 1997 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.
(e) The Banks shall have received the written legal opinion of
Sheppard, Mullin, Xxxxxxx & Xxxxxxx, 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.
8.2 Any Advance. The obligations of the Banks to make any Advance
are subject to the following conditions precedent:
(a) the Administrative Agent shall have received a Request for
Loan;
(b) the representations and warranties contained in Article 4
(other than the representations and warranties contained in Sections
4.4(a), 4.5, 4.6, 4.7, 4.9, 4.12, 4.14, 4.18 and 4.19) shall be true and
correct in all material respects on and as of the date of the Loan as
though made on and as of that date and no event or circumstance that
constitutes a Material Adverse Effect shall have occurred since the 1997
Closing Date; and
(c) the Administrative Agent shall have received such other
information relating to any matters which are the subject of Section
8.2(b) or the compliance by Borrower with this Agreement as may
reasonably be requested by the Administrative Agent on behalf of a Bank.
8.3 Any Letter of Credit. The obligation of an Issuing Bank to
issue any Letter of Credit, and the obligation of the other Banks to participate
therein, are subject to the conditions precedent that (a) the conditions set
forth in Section 8.2 have been satisfied and
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(b) Borrower shall have certified that, giving effect to the
issuance of the requested Letter of Credit, the Letter of Credit Usage
shall not exceed any limitations set forth in this Agreement.
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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 or a Swing Line note on the date, or any payment in respect of a
Letter of Credit pursuant to Section 2.5(e), 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 five Banking Days after the date when due;
or
(c) any failure to comply with Sections 5.8, 5.9, 6.1, 6.2, 6.3,
6.4, 6.7, 6.9, 6.10, 6.11, 6.15, 6.16, 6.17, 6.18 or 7.1(f); or
(d) any failure to comply with Section 6.8 which shall remain
unremedied for a period of three Banking Days after notice by the
Administrative Agent of such Default; 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 thirty (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 1997 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 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
Agreement), 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
$10,000,000 individually or $25,000,000 in the aggregate or (ii) fails
to perform or observe any other material
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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 Agreement)
or any guaranty of present or future Indebtedness (other than
Non-Recourse Indebtedness), in excess of $10,000,000 individually or
$25,000,000 in the aggregate, if as a result of such failure or such
condition any 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;
(j) a final judgment (or judgments) against Borrower or any of
its Significant Subsidiaries is entered for the payment of money in
excess of $10,000,000 individually or $25,000,000 in the aggregate, 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 five (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 sixty
(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 sixty (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 $10,000,000; 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
$10,000,000; or
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(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.
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:
(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):
(i) all commitments to make Advances or issue Letters of
Credit, and all other obligations of the Administrative Agent,
any Issuing Bank or the Banks shall be suspended without notice
to or demand upon Borrower, which are expressly waived by
Borrower, except that the Majority Banks may waive the Event of
Default or, without waiving, determine, upon terms and conditions
satisfactory to the Majority Banks, to reinstate the Commitments
and make further Advances or issue Letters of Credit, which
waiver or determination shall apply equally to, and shall be
binding upon, all the Banks; and
(ii) 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, an amount equal to the Letter of
Credit Usage, 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:
(i) all commitments to make Advances or issue Letters of
Credit, and all other obligations of the Administrative Agent,
any Issuing Bank or the Banks under the Loan Documents shall
terminate without notice to or demand upon Borrower, which are
expressly waived by Borrower, except that all the Banks may waive
the Event of Default or, without waiving, determine, upon terms
and conditions satisfactory to all the Banks, to reinstate the
Commitments and make further Advances; and
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(ii) the unpaid principal of all Obligations due to the
Banks hereunder and under the Notes, an amount equal to the
Letter of Credit Usage 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) So long as any Letter of Credit shall remain outstanding, any
amounts received by the Administrative Agent in respect of the Letter of
Credit Usage pursuant to Section 9.2.(a)(ii) or 9.2(b)(ii) may be held
as cash collateral for the obligation of Borrower to reimburse the
Issuing Bank in event of any drawing under any Letter of Credit (and
Borrower hereby grants to the Administrative Agent a security interest
in such cash collateral). In the event any Letter of Credit in respect
of which Borrower has deposited cash collateral with the Administrative
Agent is canceled or expires, the cash collateral shall be applied first
to the reimbursement of the Issuing Bank (or all of the Banks, as the
case may be) for any drawings thereunder, and second to the payment of
any outstanding Obligations of Borrower hereunder or under any other
Loan Document.
(d) 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.
(e) 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
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Agent or the Banks under the Loan Documents. Subject to Section 9.2(a)(i), 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.
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(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.
(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 nor any of its respective directors, officers, agents, or
employees shall be liable 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
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for Borrower, and shall not be liable 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 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 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 Commitments, indemnify and hold the
Administrative Agent and its 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
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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, 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.
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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 Sections 8.1,
8.2, and 8.3 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 (except
as provided in Section 2.6) the amount of the Commitments 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 Line
A or Line B Obligation or any installment of any fee or (except as
provided in Section 2.6) to extend the term of the Commitments;
(c) to amend or modify the provisions of the definitions 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; 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.
For purposes of clauses (a) and (b), above, "all of the Banks" shall mean all of
the Banks holding a Line A Note or Line B Note, as applicable, as to those
events that impact solely Banks holding one set of Notes or the other. Any
amendment, modification, supplement,
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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.
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 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, (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 (c) any amendment, waiver or modification of the Loan
Documents. Borrower shall 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 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 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 fees and
out-of-pocket expenses of any legal counsel retained by the Administrative Agent
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 (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
nor for 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 costs, expenses, fees, and charges of
Persons (other than the Administrative Agent 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 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
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
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supporting documentation) for payment at the rate then in effect for Alternate
Base 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 upon the performance by any other Bank of its
obligation to make Advances. A default by any Bank will not increase 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.
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
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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, 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 Effective Date, each Bank may
assign to one or more Eligible Assignee all or any portion of its Pro
Rata Share of the Commitments; 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), (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 Commitments of the assigning Bank, the assignment shall not
assign a Pro Rata Share of the Commitments equivalent to less than
$15,000,000 and that is not an integral multiple of $5,000,000, (iv)
except in the case of an assignment of the entire remaining Commitments
of the assigning Bank, giving effect to the assignment, the assigning
Bank will not be in violation of its Applicable Minimum Hold Requirement
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 five (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 Commitments 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.
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(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 Commitments
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 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 $4,000 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 Commitments; 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), (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
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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 Commitments equivalent to less than $15,000,000,
(viii) giving effect to the participation, the granting Bank will not be
in violation of its Applicable Minimum Hold Requirement, (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, or (D) 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 Commitments 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 Commitments.
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 3.14 or 9.2(e), 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 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 3.14 and 9.2(e), 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.
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11.10 Indemnity by Borrower. Borrower agrees to indemnify, save,
and hold harmless the Administrative Agent 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 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
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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 to use any confidential
information that it may receive, directly or indirectly, from Borrower pursuant
to this Agreement only for the purposes of this Agreement and to hold such
confidential information in confidence, except for disclosure: To Affiliates of
the Bank; 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 Commitments, 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.
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
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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 PROCEEDING TO
ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT,
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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.
11.24 Hazardous Materials Indemnity. Without limiting any other
indemnity provided for in the Loan Documents, Borrower agrees to indemnify the
Administrative Agent, each other Managing Agent 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
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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/ XXXXXXX X. XXXX
----------------------------------------
Xxxxxxx X. Xxxx
Senior Vice President
and Chief Financial Officer
By /s/ XXXXXX X. XXXXXX
----------------------------------------
Xxxxxx X. Xxxxxx
Vice President and Treasurer
00000 Xxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx
Vice President and Treasurer
Phone: (000) 000-0000
Fax: (000) 000-0000
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BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Administrative Agent,
Co-Syndication Agent, a Managing Agent,
and a Bank
By: /s/ XXXX XXXXXX
----------------------------------------
Xxxx Xxxxxx
Vice President
Domestic Lending Office
Bank of America NT&SA
CRESG - National Accounts #1357
000 Xxxxx Xxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
LIBOR Lending Office
Bank of America NT&SA
CRESG National Accounts #1357
000 Xxxxx Xxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxxx Xxxxxxxxxxx or
Xxxx Xxxxxx
Telephone: (000) 000-0000 (Xxxxxxxxxxx)
(000) 000-0000 (Xxxxxx)
Telecopier: (000) 000-0000
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101
NATIONSBANK OF TEXAS, N.A., as
Syndication Agent, a
Managing Agent, and a Bank
By: /s/ XXXXXXX XXXXXXXX
----------------------------------------
Xxxxxxx Xxxxxxxx
Senior Vice President
Domestic and LIBOR Lending Office
NationsBank of Texas, N.A.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
Senior Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
CREDIT LYONNAIS, LOS ANGELES BRANCH,
as Documentation Agent, a Managing Agent,
and a Bank
By:
-----------------------------------------
Xxxxxx X. Xxxxx
Vice President and Branch Manager
Domestic and LIBOR Lending Office
Credit Lyonnais, Los Angeles Branch
000 Xxxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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NATIONSBANK OF TEXAS, N.A., as
Syndication Agent, a
Managing Agent, and a Bank
By:
----------------------------------------
Xxxxxxx Xxxxxxxx
Senior Vice President
Domestic and LIBOR Lending Office
NationsBank of Texas, N.A.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
Senior Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
CREDIT LYONNAIS, LOS ANGELES BRANCH,
as Documentation Agent, a Managing Agent,
and a Bank
By: /s/ XXXXXX X. XXXXX
----------------------------------------
Xxxxxx X. Xxxxx
Vice President and Branch Manager
Domestic and LIBOR Lending Office
Credit Lyonnais, Los Angeles Branch
000 Xxxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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GUARANTY FEDERAL BANK F.S.B., as a
Co-Agent and a Bank
By: /s/ XXXXXXX X. XXXXXXXX
----------------------------------------
Xxxxxxx X. Xxxxxxxx
Vice President
Domestic and LIBOR Lending Office:
Guaranty Federal Bank F.S.B.
0000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxx Xxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
SOCIETE GENERALE, LOS ANGELES BRANCH,
as a Co-Agent and a Bank
By:
----------------------------------------
Xxxxxxx Xxxxx
Vice President
Domestic and LIBOR Lending Office
Societe Generale
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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GUARANTY FEDERAL BANK F.S.B., as a
Co-Agent and a Bank
By:
----------------------------------------
Xxxxxxx X. Xxxxxxxx
Vice President
Domestic and LIBOR Lending Office:
Guaranty Federal Bank F.S.B.
0000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxx Xxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
SOCIETE GENERALE, LOS ANGELES BRANCH,
as a Co-Agent and a Bank
By: /s/ XXXXXX Y. L. XXXX
----------------------------------------
Xxxxxx Y. L. Chen
Vice President
Domestic and LIBOR Lending Office
Societe Generale
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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XXXXX XXXX XX XXXXXXXXXX, N.A., as a
Co-Agent and a Bank
By: /s/ XXXX X. XXXXXXX
----------------------------------------
Xxxx X. Xxxxxxx
Vice President
Domestic and LIBOR Lending Office
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
THE CHASE MANHATTAN BANK (formerly known as
Chemical Bank), as a Bank
By:
----------------------------------------
Xxxxx X. X'Xxxxx
Vice President
Domestic and LIBOR Lending Office
The Chase Manhattan Bank
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. X'Xxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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XXXXX XXXX XX XXXXXXXXXX, N.A., as a
Co-Agent and a Bank
By:
----------------------------------------
Xxxx X. Xxxxxxx
Vice President
Domestic and LIBOR Lending Office
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
THE CHASE MANHATTAN BANK (formerly known as
Chemical Bank), as a Bank
By: /s/ XXXXX X. X'XXXXX
----------------------------------------
Xxxxx X. X'Xxxxx
Vice President
Domestic and LIBOR Lending Office
The Chase Manhattan Bank
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. X'Xxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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107
SUNTRUST BANK, ATLANTA, as a Bank
By: /s/ XXXXXXXX X. XXXXXXXX
----------------------------------------
Xxxxxxxx X. Xxxxxxxx
Vice President
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Xxxxx X. Xxxxxxx
Banking Officer
Domestic and LIBOR Lending Office
SunTrust Bank, Atlanta
00 Xxxx Xxxxx, X.X.
Xxxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
THE INDUSTRIAL BANK OF JAPAN, LIMITED,
LOS ANGELES AGENCY, as a Bank
By:
----------------------------------------
Xxxxxxxx Xxxxxx
Senior Vice President
Domestic and LIBOR Lending Office
The Industrial Bank of Japan, Ltd.
Los Angeles Agency
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Assistant Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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SUNTRUST BANK, ATLANTA, as a Bank
By:
----------------------------------------
Xxxxxxxx X. Xxxxxxxx
Vice President
By:
----------------------------------------
Xxxxx X. Xxxxxxx
Banking Officer
Domestic and LIBOR Lending Office
SunTrust Bank, Atlanta
00 Xxxx Xxxxx, X.X.
Xxxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
THE INDUSTRIAL BANK OF JAPAN, LIMITED,
LOS ANGELES AGENCY, as a Bank
By: /s/ XXXXXXXX XXXXXX
----------------------------------------
Xxxxxxxx Xxxxxx
Senior Vice President
Domestic and LIBOR Lending Office
The Industrial Bank of Japan, Ltd.
Los Angeles Agency
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Assistant Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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THE FIRST NATIONAL BANK OF CHICAGO,
as a Bank
By: /s/ XXXXX X. XXXXXX
----------------------------------------
Xxxxx X. Xxxxxx
Assistant Vice President
Domestic and LIBOR Lending Office
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Assistant Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
THE BANK OF NEW YORK, as a Bank
By:
----------------------------------------
Xxxxxxx X. Xxxxxx
Vice President
Domestic and LIBOR Lending Office
The Bank of New York
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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THE FIRST NATIONAL BANK OF CHICAGO,
as a Bank
By:
----------------------------------------
Xxxxx X. Xxxxxx
Assistant Vice President
Domestic and LIBOR Lending Office
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Assistant Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
THE BANK OF NEW YORK, as a Bank
By: /s/ XXXXXXX X. XXXXXX
----------------------------------------
Xxxxxxx X. Xxxxxx
Vice President
Domestic and LIBOR Lending Office
The Bank of New York
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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111
COMERICA BANK, as a Bank
By: /s/ XXXXX X. XXXXXXXX
----------------------------------------
Xxxxx X. Xxxxxxxx
Vice President
Domestic and LIBOR Lending Office
Comerica Bank
One Detroit Center
000 Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
SANWA BANK CALIFORNIA, as a Bank
By:
----------------------------------------
Xxxxxx XxXxxxxx
Vice President
Domestic and LIBOR Lending Office
Sanwa Bank California
Real Estate Industries
0000 XxxXxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx XxXxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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COMERICA BANK, as a Bank
By:
----------------------------------------
Xxxxx X. Xxxxxxxx
Vice President
Domestic and LIBOR Lending Office
Comerica Bank
One Detroit Center
000 Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
SANWA BANK CALIFORNIA, as a Bank
By: /s/ XXXXXX XXXXXXXX
----------------------------------------
Xxxxxx XxXxxxxx
Vice President
Domestic and LIBOR Lending Office
Sanwa Bank California
Real Estate Industries
0000 XxxXxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx XxXxxxxx
Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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BANQUE PARIBAS, as a Bank
By: /s/ XXXXXXX X. XXXXX
----------------------------------------
Xxxxxxx X. Xxxxx
Assistant Vice President
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Xxxxx X. Xxxxxxx
Vice President and Group Head
Domestic Lending Office
Banque Paribas
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Assistant Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
LIBOR Lending Office
Banque Paribas
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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KREDIETBANK N.V., GRAND CAYMAN BRANCH,
as a Bank
By: /s/ XXXXXX XXXXXXXX
----------------------------------------
Xxxxxx Xxxxxxxx
Vice President
----------------------------------------
Printed Name and Title
By: /s/ XXXXXXX X. XXXXXX
----------------------------------------
Xxxxxxx X. Xxxxxx
Vice President
----------------------------------------
Printed Name and Title
Domestic and LIBOR Lending Office
Kredietbank N.V., Grand Cayman Branch
c/o Kredietbank N.V., New York Branch
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx or
Xxxxx Xxxxxxx
Telephone: (000) 000-0000 (Resuma)
(000) 000-0000 (Xxxxxxx)
Telecopier: (000) 000-0000/5581
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EXHIBIT A
COMMITMENT ASSIGNMENT AND ACCEPTANCE AGREEMENT
THIS COMMITMENT ASSIGNMENT AND ACCEPTANCE AGREEMENT ("Agreement")
dated as of ____________ is made with reference to that certain 1997 Revolving
Loan Agreement, dated as of April 21, 1997 (the "Loan Agreement") among KBHC,
the Agents and the Banks who are parties thereto, 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:
"Agents" means, collectively, the Managing Agents, the
Syndication Agent, the Documentation Agent, the Co-Syndication Agent and
the Administrative Agent.
"Assignee" means __________________________________.
"Assigned Pro Rata Share" means (a) _____% of the Line A Commitment
of the Banks under the Loan Agreement, being equal to the following dollar
amount: $____________ and/or (b) _____% of the Line B Commitment of the Banks
under the Loan Agreement, being equal to the following dollar amount:
$___________ or if the outstanding indebtedness under the Line B Notes has been
converted to a term loan pursuant to Section 2.6(e) of the Loan Agreement, ____%
of the outstanding principal balance under the Line B Notes, being equal to the
following dollar amount: $____________.
"Assignor" 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 Line A
Commitment and _____% of the Line B Commitment (without giving effect to
assignments
116
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 Line A Commitment is $__________, the Assignor's Pro Rata Share of all
Letters of Credit issued under Section 2.5(a) of the Loan Agreement is
$__________, the Assignor's Pro Rata Share of all Swing Line Outstandings under
the Loan Agreement is $_________, the outstanding principal balance of Advances
made by Assignor under the Line B Commitment is $_________ and, if the
outstanding indebtedness under the Line B Notes has been converted to a term
loan pursuant to Section 2.6(e) of the Loan Agreement, the outstanding principal
balance owed to Assignor under its Line B Note 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.
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, sufficiency or value 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;
117
(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 Agents 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 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 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
118
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 Commitments 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 Pro Rata Share of Pro Rata Share
Line A Commitment Line B Commitment of Commitments
----------------- ----------------- --------------
Assignor __% ($_________) __% ($_________) __% ($_________)
Assignee __% ($_________) __% ($_________) __% ($_________)
and, if the outstanding indebtedness under the Line B Notes has been converted
to a term loan pursuant to Section 2.6(e) of the Loan Agreement, the outstanding
principal balance of the Line B Note held by Assignor shall be $____________ and
the principal balance of the Line B Note held by Assignee shall be
$____________.
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.
119
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:
------------------------------
120
"Assignee"
--------------------------------------------
By:
------------------------------------
------------------------------------
Printed Name and Title
Address:
------------------------------------
------------------------------------
------------------------------------
Attn:
------------------------------
121
Exhibit A to Commitment Assignment and Acceptance Agreement
REQUEST FOR REGISTRATION
TO: BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as
Administrative Agent
THIS REQUEST FOR REGISTRATION OF ASSIGNEE is made as of the date of
the enclosed Commitment Assignment and Acceptance Agreement with reference to
that certain 1997 Revolving Loan Agreement dated as of April 21, 1997 among KBHC
and the Agents and the Banks who are parties thereto.
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 Agreement sets forth the correct
Commitments 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 Notes 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
122
"Assignee"
--------------------------------------------
By:
------------------------------------
------------------------------------
Printed Name and Title
THE UNDERSIGNED HEREBY CONSENT
TO THE ABOVE ASSIGNMENT:
XXXXXXX AND BROAD HOME CORPORATION,
a Delaware corporation
By:
---------------------------------
---------------------------------
Printed Name and Title
Exhibit A
123
Exhibit B to Commitment Assignment and Acceptance Agreement
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 Pro
Rata Shares of the Commitments corresponding to the Assigned Pro Rata Share and
has adjusted the registered Pro Rata Shares of the Commitments of Assignor to
reflect the assignment of the Assigned Pro Rata Share.
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Administrative Agent
By:
------------------------------------
------------------------------------
Printed Name and Title
Exhibit B
124
EXHIBIT B
COMPLIANCE CERTIFICATE AS REQUIRED BY ARTICLE 7, SECTION 2
OF THE 1997 REVOLVING LOAN AGREEMENT
FOR THE PERIOD ENDING NOVEMBER 30, 1996
ARTICLE 6.9 - CONSOLIDATED TANGIBLE NET WORTH
11/30/96A 2/28/97 5/31/97 8/31/97 11/30/97 11/30/98 11/30/99
--------- ------- ------- ------- -------- -------- --------
$000 $000 $000 $000 $000 $000 $000
Measured from 12/1/96:
----------------------
Consolidated Net Income 0
50% cumulative Consolidated Net Income 0
proceeds from issuance capital stock 0
50% cumulative proceeds issuance capital stock 0
6.9 MINIMUM CONSOLIDATED TANGIBLE NET WORTH
----------------------------------------------------------------------
(a) Base Amount 300,000 300,000 300,000 300,000 300,000 300,000 300,000
(b) Plus - 50% of cumulative Consolidated
Net Income 0
(c) Plus - 50% cumulative proceeds from
Issuance capital stock after 11/30/96
(d) Stock Repurchase Stepdown 0
------------------------------------------------------------------------
MINIMUM CONSOLIDATED TANGIBLE NET WORTH 300,000
------------------------------------------------------------------------
1.1 "CONSOLIDATED TANGIBLE NET WORTH"
-------------------------------------------------------------
Consolidated Shareholder's Equity 340,348
book value goodwill from
Acquisitions after 11/30/96 0
/Plus any cumulative foreign
currency translation adjustment (4,323)
------------------------------------------------------------------------
CONSOLIDATED TANGIBLE NET WORTH 336,025 0 0 0 0 0 0
------------------------------------------------------------------------
CTNW /MIN CTNW 36,025 0 0 0 0 0 0
========================================================================
125
EXHIBIT B
COMPLIANCE CERTIFICATE AS REQUIRED BY ARTICLE 7, SECTION 2
OF THE 1997 REVOLVING LOAN AGREEMENT
FOR THE PERIOD ENDING NOVEMBER 30, 1996
ARTICLE 6.10 - CONSOLIDATED LEVERAGED RATIO
11/30/96A 2/28/97 5/31/97 8/31/97 11/30/97 11/30/98 11/30/99
--------- ------- ------- ------- -------- -------- --------
$000 $000 $000 $000 $000 $000 $000
1.1 "CONSOLIDATED TOTAL INDEBTEDNESS"
-------------------------------------------------------------
revolving credit facility 30,400
secured debt 7,243
senior notes - 10-3/8% 100,000
senior sub notes - 9-3/8% 173,981
senior sub notes - 9-5/8% 124,406
other unsecured 6,617
financial letters of credit 12,356
Contingent Guaranty Obligations 0
------------------------------------------------------------------------
TOTAL CONSOLIDATED INDEBTEDNESS 454,983 0 0 0 0 0 0
------------------------------------------------------------------------
total equity interest in unconsol JVs 8,312
KBMHG equity interest in
unconsol JVs 0
------------------------------------------------------------------------
net equity interest in unconsol JVs 8,312
CONSOLIDATED TANGIBLE NET WORTH 336,025
net equity interest in
unconsol JVs > $30m 0
CONSOLIDATED TANGIBLE NET WORTH FOR ------------------------------------------------------------------------
CONSOLIDATED LEVERAGE RATIO 336,025 0 0 0 0 0 0
------------------------------------------------------------------------
DEBT TO CAPITAL RATIO 56.5% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
------------------------------------------------------------------------
ACTUAL CONSOLIDATED LEVERAGE RATIO | 1.35 0.0 0.0 0.0 0.0 0.0 0.0|
------------------------------------------------------------------------
----------
6.10 MAX CONSOLIDATED LEVERAGE RATIO | 2.25 | 2.25 2.25 2.25 2.25 2.25 2.25
----------------------------------------------------------------------
(a) MAX ACQUISITION PERIOD LEVERAGE RATIO 2.65 2.65 2.65 2.65 2.65 2.65 2.65
(b) MAX CURE PERIOD LEVERAGE RATIO 2.50 2.50 2.50 2.50 2.50 2.50 2.50
(c) MAX OPERATING LOSS LEVERAGE RATIO 1.75 1.75 1.75 1.75 1.75 1.75 1.75
126
EXHIBIT B
COMPLIANCE CERTIFICATE AS REQUIRED BY ARTICLE 7, SECTION 2
OF THE 1997 REVOLVING LOAN AGREEMENT
FOR THE PERIOD ENDING NOVEMBER 30, 1996
ARTICLE 6.11 - CONSOLIDATED INTREST COVERAGE RATIO
1996 Actual 2/28/97 5/31/97 8/31/97 11/30/97 11/30/98 11/30/99
----------- ------- ------- ------- -------- -------- --------
$000 $000 $000 $000 $000 $000 $000
1.1 "CONSOLIDATED INTEREST COVERAGE RATIO"
-----------------------------------------------------------
1.1 "CONSOLIDATED EBITDA"
(a) Consolidated Net Income (61,245)
(b) Plus - any extraordinary loss 0
(c) any extraordinary gain 0
(d) Plus - Consolidated Interest Expense 36,691
(e) Plus - federal and state taxes (34,500)
(f) Plus - depreciation and amortization 12,329
(f) Plus - all other non cash expenses
-------------------------------------------------------------------------
CONSOLIDATED EBITDA (46,725) 0 0 0 0 0 0
-------------------------------------------------------------------------
1.1 "CONSOLIDATED ADJUSTED EBITDA"
-----------------------------------------------------------
Consolidated EBITDA (46.725)
(a) Plus - capitalized interest amortized in COGS 24,893
(b) Plus - non-Cash NRV Adjustments 170,757
-------------------------------------------------------------------------
CONSOLIDATED ADJUSTED EBITDA 148,925
-------------------------------------------------------------------------
12 MO TRAILING CONSOLIDATED ADJUSTED EBITDA 148,925
=========================================================================
1.1 "CONSOLIDATED INTEREST EXPENSE"
---------------------------
Consolidated Interest Expense 36,691
Plus - interest capitalized to COGS 26,937
Plus - dividends paid on preferred stock 0
-------------------------------------------------------------------------
CONSOLIDATED INTEREST EXPENSE 63,628
-------------------------------------------------------------------------
12 MO TRAILING CONSOLIDATED INTEREST EXPENSE 63,628
=========================================================================
-------------------------------------------------------------------------
CONSOLIDATED INTEREST COVERAGE RATIO 2.34
-------------------------------------------------------------------------
6.11 MIN CONSOLIDATED INTEREST COVERAGE RATIO | 2.00 | 2.00 2.00 2.00 2.00 2.25 2.25
-----------------------------------------------------------------------
(a) MIN CURE PERIOD COVERAGE RATIO 1.50 1.50 1.50 1.50 1.50 1.75 1.75
127
EXHIBIT B
COMPLIANCE CERTIFICATE AS REQUIRED BY ARTICLE 7, SECTION 2
OF THE 1997 REVOLVING LOAN AGREEMENT
FOR THE PERIOD ENDING NOVEMBER 30, 1996
ARTICLE 6.15 INVENTORY
11/30/96A 2/28/97 5/31/97 8/31/97 11/30/97 11/30/98 11/30/99
--------- ------- ------- ------- -------- -------- --------
$000 $000 $000 $000 $000 $000 $000
DOMESTIC UNIMPROVED LAND ------------------------------------------------------------------------
BOOK VALUE 90,374
------------------------------------------------------------------------
------------------------------------------------------------------------
CONSOLIDATED TANGIBLE NET WORTH 336,025
------------------------------------------------------------------------
DOMESTIC UNIMPROVED LAND BOOK VALUE
AS PERCENT OF
CONSOLIDATED TANGIBLE NET WORTH 27.0%
========================================================================
CUSHION 245,291
========================================================================
128
EXHIBIT B
COMPLIANCE CERTIFICATE AS REQUIRED BY ARTICLE 7, SECTION 2
OF THE 1997 REVOLVING LOAN AGREEMENT
FOR THE PERIOD ENDING NOVEMBER 30, 1996
ARTICLE 6.16 - CERTAIN INVESTMENTS
11/30/96A 2/28/97 5/31/97 8/31/97 11/30/97 11/30/98 11/30/99
--------- ------- ------- ------- -------- -------- --------
$000 $000 $000 $000 $000 $000 $000
(a) equity in Foreign Subsidiaries 27,452
Plus any interco receivables - foreign subs 23,405
any interco payables - foreign subs (3,449)
------------------------------------------------------------------------
INVESTMENT IN FOREIGN SUBSIDIARIES 47,408 0 0 0 0 0 0
------------------------------------------------------------------------
AGGREGATE INVESTMENT IN FOREIGN
SUBSIDIARIES AFTER 11/30/96 n/a
========================================================================
(b) equity in Financial Subsidiaries 35,208
Plus any interco receivables - financial subs 0
any interco payables - financial subs (2,690)
------------------------------------------------------------------------
INVESTMENT IN FINANCIAL SUBSIDIARIES 32,518 0 0 0 0 0 0
------------------------------------------------------------------------
AGGREGATE INVESTMENT IN FINANCIAL
SUBSIDIARIES AFTER 11/30/96 n/a
========================================================================
(c) INVESTMENT IN SPECIFIED ENTITIES 8,312
------------------------------------------------------------------------
AGGREGATE INVESTMENT IN SPECIFIED
ENTITIES AFTER 11/30/96 n/a
========================================================================
AGGREGATE INVESTMENTS IN FOREIGN AND
FINANCIAL SUBSIDIARIES AND SPECIFIED ------------------------------------------------------------------------
ENTITIES AFTER 11/30/96 n/a
========================================================================
129
EXHIBIT C-1
LINE A NOTE
$________________ April 21, 1997
Los Angeles, California
FOR VALUE RECEIVED, the undersigned promises to pay to the order of
______________________________ ("the Bank") the principal amount of
__________________________________ DOLLARS ($___________), or such lesser
aggregate amount of Advances as may be made pursuant to the Bank's Pro Rata
Share of the Line A Commitment under the 1997 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 1997 Revolving Loan Agreement dated as of
April 21, 1997, among the undersigned, as Borrower, the Banks that are parties
thereto, Bank of America National Trust and Savings Association, as
Administrative Agent and Co- Syndication Agent, NationsBank of Texas, N.A., as
Syndication Agent, Credit Lyonnais, as Documentation Agent and Guaranty Federal
Bank, F.S.B., Societe Generale and Union Bank of California, N.A. as Co-Agents
(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 Line A 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 Line A 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, both before and
after default and before and after maturity and
130
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 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 Advances made by it and payments of principal with respect to
this Line A Note, and such record shall be presumptive evidence of the principal
amount owing under this Line A 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 Line A 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 ______________________________________
Xxxxxxx X. Xxxx
Senior Vice President
and Chief Financial Officer
By ______________________________________
Xxxxxx Xxxxxx
Vice President and Treasurer
131
ADVANCES AND PAYMENTS OF PRINCIPAL
(Alternate Base Rate Loans)
--------------------------------------------------------------------------------
Amount of
Amount of Loan or Principal Paid or
of Redesignation Redesignated Into Unpaid
From Another Another Type of Principal Notation
Date Type of Loan Loan Balance Made By
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
132
ADVANCES AND PAYMENTS OF PRINCIPAL
(LIBOR Loans)
--------------------------------------------------------------------------------
Amount of
Amount of Loan or Principal Paid or
of Redesignation Redesignated Into Unpaid
From Another Another Type of Principal Notation
Date Type of Loan Loan Balance Made By
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
133
EXHIBIT C-2
LINE B NOTE
$________________ April 21, 1997
Los Angeles, California
FOR VALUE RECEIVED, the undersigned promises to pay to the order of
______________________________ ("the Bank") the principal amount of
__________________________________ DOLLARS ($___________), or such lesser
aggregate amount of Advances as may be made pursuant to the Bank's Pro Rata
Share of the Line B Commitment under the 1997 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 1997 Revolving Loan Agreement dated as of
April 21, 1997, among the undersigned, as Borrower, the Banks that are parties
thereto, Bank of America National Trust and Savings Association, as
Administrative Agent and Co- Syndication Agent, NationsBank of Texas, N.A., as
Syndication Agent, Credit Lyonnais, as Documentation Agent and Guaranty Federal
Bank, F.S.B., Societe Generale and Union Bank of California, N.A. as Co-Agents
(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 Line B 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 Line B 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, both before and
after default and before and after maturity and
134
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 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 Advances made by it and payments of principal with respect to
this Line B Note, and such record shall be presumptive evidence of the principal
amount owing under this Line B 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 Line B 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 ______________________________________
Xxxxxxx X. Xxxx
Senior Vice President
and Chief Financial Officer
By ______________________________________
Xxxxxx Xxxxxx
Vice President and Treasurer
135
ADVANCES AND PAYMENTS OF PRINCIPAL
(Alternate Base Rate Loans)
--------------------------------------------------------------------------------
Amount of
Amount of Loan or Principal Paid or
of Redesignation Redesignated Into Unpaid
From Another Another Type of Principal Notation
Date Type of Loan Loan Balance Made By
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
136
ADVANCES AND PAYMENTS OF PRINCIPAL
(LIBOR Loans)
--------------------------------------------------------------------------------
Amount of
Amount of Loan or Principal Paid or
of Redesignation Redesignated Into Unpaid
From Another Another Type of Principal Notation
Date Type of Loan Loan Balance Made By
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
137
EXHIBIT D-1
[SIDLEY & AUSTIN LETTERHEAD]
April 21, 1997
To: Bank of America National Trust and
Savings Association, as Administrative
Agent, Co-Syndication Agent and
Managing Agent
NationsBank of Texas, N.A., as
Syndication of Agent and Managing Agent
Credit Lyonnais Los Angeles Branch,
as Documentation Agent and Managing Agent
c/o Bank of America National Trust and
Savings Association
CRESG-LA National #1357
000 Xxxxx Xxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Re: Xxxxxxx and Broad Home Corporation
----------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Xxxxxxx and Broad Home Corporation, a
Delaware corporation ("Borrower") in connection with the 1997 Revolving Loan
Agreement (the "Loan Agreement") dated as of April 21, 1997, by and among
Borrower, the Banks which are parties thereto, Bank of America National Trust
and Savings Association, as Administrative Agent, Co-Syndication Agent and
Managing Agent, NationsBank of Texas, N.A., as Syndication Agent and Managing
Agent, Credit Lyonnais Los Angeles Branch, as Documentation Agent and Managing
Agent and the Co-Agents named therein (all such parties other than the Borrower
are collectively referred to herein as "Bank Parties").
This option is furnished to you pursuant to Section 8.1(a)(vi) of the Loan
Agreement. Terms not otherwise defined herein shall have the meanings defined
for such terms in the 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 Loan Agreement;
000
Xxxx xx Xxxxxxx National Trust and
Savings Association
Credit Lyonnais Los Angeles Branch
NationsBank of Texas, N.A.,
as Managing Agents
April 21, 1997
Page 2
(b) the Notes and a Swing Loan Document consisting of a promissory note
of even date herewith; and
(c) the Subsidiary Guaranty.
The agreements described in (a) through (c) 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 of
public officials, 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) 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 listed in Schedule 4.4 to the Loan
Agreement (the "Guarantor Subsidiaries") is duly organized, validly existing
and in good standing under the laws of its jurisdiction or 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 is a national bank, state
bank or a 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
000
Xxxx xx Xxxxxxx National Trust and
Savings Association
Credit Lyonnais Los Angeles Branch
NationsBank of Texas, N.A.,
as Managing Agents
April 21, 1997
Page 3
in any respect, and remain in full force and effect as of the date hereof.
On the basis of the foregoing, and relying thereon, and with the
qualifications herein set forth, we are of the opinion that:
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 Subsidiary Guarantor 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 corporations (or, in the case of Xxxxxxx and Broad of Texas, Ltd.,
limited partnerships) 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.
140
Bank of America National Trust and
Savings Association
Credit Lyonnais Los Angeles Branch
NationsBank of Texas, N.A.,
as Managing Agents
April 21, 1997
Page 4
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 may
be, 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 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; provided,
that 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 as to which we
express no opinion:
141
Bank of America National Trust and
Savings Association
Credit Lyonnais Los Angeles Branch
NationsBank of Texas, N.A.,
as Managing Agents
April 21, 1997
Page 5
(i) the Borrower's agreements in the Loan Documents to indemnify you
against costs or expenses or liability notwithstanding your acts of negligence
or willful misconduct;
(ii) the Borrower's agreements 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 Borrower's 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 delay in
000
Xxxx xx Xxxxxxx National Trust and
Savings Association
Credit Lyonnais Los Angeles Branch
NationsBank of Texas, N.A.,
as Managing Agents
April 21, 1997
Page 6
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; and
(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.
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, 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 for your benefit at the specific
request of our clients, is rendered to you in connection with the transaction
referred to above and may not be relied upon by any person (other than the Bank
Parties, an Eligible Assignee or any successor in interest of any Bank Party)
or by you or the other 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 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,
SIDLEY & AUSTIN
143
April 21, 1997
To: Bank of America National Trust and
Savings Association, as Administrative Agent,
Co-Syndication Agent and Managing Agent;
NationsBank of Texas, N.A., as
Syndication Agent and Managing Agent; and
Credit Lyonnais, as Documentation Agent and
Managing Agents
c/o Bank of America National Trust and
Savings Association
CRESG National Accounts, #1357
000 X. Xxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxxxxx, XX 00000
Ladies and Gentlemen:
I am the General Counsel of Xxxxxxx and Broad Home Corporation, a
Delaware corporation ("KBHC"). (KBHC shall also be referred to herein as the
"Borrower"). I have acted as such in connection with the 1997 Revolving Loan
Agreement dated as of April 21, 1997 (the "Agreement"), by and among the
Borrower and the Banks which are the parties thereto. The term "Banks" shall,
for the purposes of this letter, have the meaning ascribed to such term in the
Agreement.
This opinion is furnished to you pursuant to Section 8.1 (a)(vi) of the
Agreement. Terms not otherwise defined herein shall have the meanings defined
for such terms in the Agreement. The term "Loan Documents", as used herein,
means those Loan Documents (as defined in the Agreement) in existence as of the
Closing Date, including without limitation those referenced in paragraphs (a)
through (c) below.
This opinion is rendered to you as a supplement to the legal opinion of
Sidley & Austin of even date herewith in connection with the Agreement but
expressly does not incorporate the terms of said Sidley & Austin opinion.
For purposes of this opinion, I have examined originals, or copies
identified to my satisfaction as being true copies, of the following documents:
000
Xxxx xx Xxxxxxx National Trust and Savings
Association
Page 2
a. the Agreement;
b. the Notes under the Agreement; and
c. the Subsidiary Guaranty.
I have also made such investigations of fact and law; obtained such
certificates of Responsible Officials of Borrower and certain of its
Subsidiaries, and of public officials; reviewed incorporation documentation,
resolutions, secretary 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) all natural persons have legal capacity, (ii) the
genuineness of all signatures of all parties other than Borrower and the
Guarantor Subsidiaries listed in Schedule 4.4 to the Agreement, (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 the Guarantor Subsidiaries, the due
authorization, execution and delivery of all documents and the validity and
enforceability thereof against all parties thereto other than Borrower and the
Guarantor Subsidiaries, (v) that each Person (other than Borrower and the
Guarantor Subsidiaries) which is a party to the Loan Documents 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)
all parties to any Loan Documents 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
states of incorporation of the Guarantor Subsidiaries, (vii) that each of the
Banks 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 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 Banks 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
000
Xxxx xx Xxxxxxx National Trust and Savings
Association
Page 3
the existence or absence of such facts. As General Counsel to KBHC, 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 that, in reviewing
such information, nothing has come to my attention which caused or should have
caused me not to render such opinions.
Based upon the foregoing and in reliance thereon, I am of the opinion that:
1. KBHC 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. KBHC 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 it is a Party
have been duly authorized by all necessary corporate action, and do not:
a. require under the charter documents of Borrower or
Guarantor Subsidiary any consent or approval not heretofore obtained
of any partner, director, stockholder, security holder or creditor of
such Party;
000
Xxxx xx Xxxxxxx National Trust and Savings
Association
Page 4
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
applicable to such Party; or
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. Each of the Loan Documents to which either 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 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.
147
Bank of America National Trust and Savings
Association
Page 5
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.
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, to the knowledge of the undersigned,
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 which 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.
148
Bank of America National Trust and Savings
Association
Page 6
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 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" (as defined in
the Agreement); provided, that 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.
(c) I call your attention to the following matters as to which I
express no opinion:
(i) the Borrower's agreements in the Loan Documents to
indemnify you against costs or expenses or liability notwithstanding your acts
of negligence or willful misconduct;
000
Xxxx xx Xxxxxxx National Trust and Savings
Association
Page 7
(ii) the Borrower's agreements 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 Borrower's 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) 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 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 waiver 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; and
000
Xxxx xx Xxxxxxx National Trust and Savings
Association
Page 8
(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.
My opinion expressed herein is 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, 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 rendered to you in connection with the transaction
referred to above and may no be relied upon by any person (other than the
Banks, an Eligible Assignee or any successor in interest of any Bank) or by you
or the other Banks 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 of any governmental agency or
authority having regulatory jurisdiction over you, (c) pursuant to 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.
Respectfully submitted,
/s/ Xxxxxx X. Xxxxxxx
-------------------------
Xxxxxx X. Xxxxxxx
Senior Vice President and
General Counsel
151
EXHIBIT E
BORROWER: XXXXXXX AND BROAD
HOME CORPORATION, a
Delaware corporation
GUARANTORS: See Schedule 1 hereto
TO: BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, for itself and
as Administrative Agent
GUARANTY
THIS GUARANTY ("Guaranty") dated as of April 21, 1997, 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 National Trust and Savings Association, as Administrative Agent,
the Syndication Agent, the Co-Syndication Agent, the Documentation Agent, the
Managing Agents, the Co-Agents 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 1997 Revolving 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
National Trust and Savings Association, as Administrative Agent and
Co-Syndication Agent, NationsBank of Texas, N.A., as Syndication Agent, Credit
Lyonnais, as Documentation Agent and Guaranty Federal Bank F.S.B., Societe
Generale and Union Bank of California, N.A., as Co-Agents (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.
152
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 National Trust and Savings Association, as the Administrative
Agent for the Banks, on demand, in lawful money of the United States, any 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 or any of its other Subsidiaries.
Separate action or actions may be brought and prosecuted against any Guarantor
whether action is brought against any 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.
153
(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.
(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.
154
(9) Guarantors agree to pay, within thirty (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 NORTHERN
CALIFORNIA, INC., a California
corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
XXXXXXX AND BROAD OF SAN DIEGO,
INC., a California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Vice President
XXXXXXX AND BROAD - SOUTH BAY,
INC., a California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Vice President
and Treasurer
000
XXXXXXX XXX XXXXX XX XXXXXXXX
XXXXXXXXXX, a California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
XXXXXXX AND BROAD - CENTRAL
VALLEY, INC., a California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Vice President
XXXXXXX AND BROAD COASTAL, INC., a
California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
XXXXXXX AND BROAD OF NEVADA, INC., a
California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
XXXXXXX AND BROAD OF ARIZONA, INC., a
California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
156
XXXXXXX AND BROAD OF COLORADO,
INC., a Colorado corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
XXXXXXX AND BROAD OF UTAH, INC., a
California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
XXXXXXX AND BROAD MULTI-HOUSING
GROUP, INC., a California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Vice President
XXXXXXX AND BROAD OF NEW MEXICO,
INC., a New Mexico corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
XXXXXXX AND BROAD OF TEXAS, LTD., a
Texas limited partnership
By: KBSA, Inc., a Texas corporation,
Its general partner
By:_________________________________
Xxxxxx X. Xxxxxx, Vice President
and Treasurer
157
XXXXXXX AND BROAD - MONTEREY BAY,
INC., a California corporation
By:______________________________________
Xxxxxx X. Xxxxxx, Treasurer
158
SCHEDULE 1
TO GUARANTY
List of Guarantors
Xxxxxxx and Broad of Northern California, Inc.
Xxxxxxx and Broad of San Diego, Inc.
Xxxxxxx and Broad - South Bay, Inc.
Xxxxxxx and Broad of Southern California
Xxxxxxx and Broad - Central Valley, Inc.
Xxxxxxx and Broad Coastal, Inc.
Xxxxxxx and Broad of Nevada, Inc.
Xxxxxxx and Broad of Arizona, Inc.
Xxxxxxx and Broad of Colorado, Inc.
Xxxxxxx and Broad of Utah, Inc.
Xxxxxxx and Broad Multi-Housing Group, Inc.
Xxxxxxx and Broad of New Mexico, Inc.
Xxxxxxx and Broad of Texas, Ltd.
Xxxxxxx and Broad - Monterey Bay, Inc.
159
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 Guaranty
dated as of April 21, 1997 (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 1997 Revolving Loan Agreement, dated as of
___________, 1997 (the "Loan Agreement") among Xxxxxxx and Broad Home
Corporation, as Borrower, the Banks signatory thereto, Bank of America National
Trust and Savings Association, as Administrative Agent and Co-Syndication Agent,
NationsBank of Texas, N.A., as Syndication Agent, Credit Lyonnais, as
Documentation Agent and Guaranty Federal Bank F.S.B., Societe Generale and Union
Bank of California, N.A., as Co-Agents.
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.
160
2. The effective date of this Joinder is _______________.
"Joining Party"
_________________________________________
a _______________________________________
By:______________________________________
_________________________________________
Printed Name and Title
ACKNOWLEDGED:
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Administrative Agent
By:______________________________________
_________________________________________
Printed Name and Title
XXXXXXX AND BROAD HOME CORPORATION
By:______________________________________
_________________________________________
Printed Name and Title
161
EXHIBIT F
Xxxxxxx and Broad Home Corporation
Summary Quarterly Sales and Backlog Report
Quarter Ending Nov. 30, 1996
--------------------- ------------------------ 30-Nov-96 ------------------------------------------------------- 30-Nov-95
Deliveries Sales Backlog Avg. Price Backlog Deliveries Sales Backlog
Division Quarter Quarter Units (000's) Value Quarter Quarter Units
--------------------- ------------------------------------------------------------------------------------------------------------
Coastal Valleys 0 0 0 $ 0 $ 0 150 82 56
Antelope Valley 75 72 50 120 6,000 136 119 69
Inland Empire 118 102 76 136 10,336 162 160 49
Coastal 204 181 116 224 25,984 135 103 60
San Diego 152 135 75 206 15,450 123 116 37
Northbay 228 159 99 194 19,206 253 165 55
Sacramento 69 63 43 148 6,364 77 99 68
Central Valley 130 112 74 128 9,472 112 97 56
Fresno 0 0 0 0 0 99 82 40
Southbay 242 255 229 297 68,013 307 209 89
Monterey Bay 146 156 92 214 19,688 155 110 47
-------------------------------------------------------------------------------------------------------------
Total California 1,364 1,135 854 211 180,513 1,709 1,342 626
-------------------------------------------------------------------------------------------------------------
Nevada 115 81 41 126 5,166 112 106 30
Arizona 143 135 139 128 17,792 109 129 83
New Mexico 87 59 132 164 21,648 120 97 166
Dallas 29 26 55 164 9,020 0 0 0
San Antonio 606 489 1,204 94 113,176 0 0 0
Colorado 180 139 121 153 18,513 164 130 191
Utah 75 39 64 170 10,880 45 41 78
-------------------------------------------------------------------------------------------------------------
Total Other US 1,235 968 1,756 112 196,195 550 503 546
-------------------------------------------------------------------------------------------------------------
Total United States 2,599 2,103 2,610 144 376,708 2,259 1,845 1,172
Maison Individuelles 284 216 142 199 28,258 203 184 167
KBD 29 51 73 265 19,345 26 26 62
-------------------------------------------------------------------------------------------------------------
Total France 313 267 215 221 47,603 229 210 229
Canada 0 0 0 0 0 16 10 11
Mexico 22 5 14 256 3,584 0 0 0
-------------------------------------------------------------------------------------------------------------
Total 2,934 2,375 2,839 $ 151 $427,895 2,504 2,065 1,412
=============================================================================================================
--------------------- ------------------------ ---------------------------- Difference --------------------------
Avg. Price Backlog Deliveries Sales Backlog Avg. price Backlog
Division (000's) Value Quarter Quarter Units (000's) Value
--------------------- -----------------------------------------------------------------------------------------------
Coastal Valleys $ 261 $14,616 $ (150) (82) (56) $ (261) $ (14,616)
Antelope Valley 116 8,004 (61) (47) (19) 4 (2,004)
Inland Empire 145 7,105 (44) (58) 27 (9) 3,231
Coastal 220 13,200 69 78 56 4 12,784
San Diego 172 6,364 29 19 38 34 9,086
Northbay 180 9,900 (25) (6) 44 14 9,306
Sacramento 145 9,860 (8) (36) (25) 3 (3,496)
Central Valley 121 6,776 18 15 18 7 2,696
Fresno 117 4,680 (99) (82) (40) (117) (4,680)
Southbay 272 24,208 (65) (54) 140 25 43,805
Monterey Bay 202 9,494 (9) 46 45 12 10,194
------------------------------------------------------------------------------------------------
Total California 182 114,207 (345) (207) 228 29 66,306
------------------------------------------------------------------------------------------------
Nevada 122 3,660 3 (25) 11 4 1,506
Arizona 121 10,043 34 6 56 7 7,749
New Mexico 159 26,394 (33) (38) (34) 5 (4,746)
Dallas 0 0 29 28 55 164 9,020
San Antonio 0 0 606 489 1,204 94 113,176
Colorado 149 28,459 16 9 (70) 4 (9,946)
Utah 130 9,880 30 (2) (12) 40 1,000
------------------------------------------------------------------------------------------------
Total Other US 144 78,436 685 465 1,210 (32) 117,759
------------------------------------------------------------------------------------------------
Total United States 164 192,643 340 258 1,438 (20) 184,065
Maison Individuelles 192 32,064 81 32 (25) 7 (3,808)
KBD 290 17,980 3 25 11 (25) 1,365
------------------------------------------------------------------------------------------------
Total France 219 50,044 84 57 (14) 3 (2,441)
Canada 102 1,122 (16) (10) (11) (102) (1,222)
Mexico 0 0 11 5 14 256 3,584
------------------------------------------------------------------------------------------------
Total $ 173 $243,809 430 310 1,427 $ (22) $184,086
================================================================================================
162
EXHIBIT G
XXXXXXX AND BROAD HOME CORPORATION
SUMMARY OF INVENTORY
AS OF NOVEMBER 30, 1996
-----Inventory Book Value (Thousands)--------- ------------Size of Project (Lots/Acres)---------------
Land Under
Homes/Lots Land Under Secured Total Total Land in Production Development
Total in Prod Development Debt Lots Acres W/Homes WO/Homes Lots Acres
-------- ---------- ----------- -------- ------ ----- -------- -------- ------ -------
California
Antelope Valley $ 39,861 $ 7,323 $ 32,538 $ 174 8,029 - 72 551 7,406 -
Inland Empire 48,696 31,806 16,890 1,375 3,787 300 148 708 2,931 300
Coastal 70,649 68,649 2,000 230 1,421 - 277 558 586 -
San Diego 57,434 50,912 6,522 - 1,524 169 175 702 647 169
Northbay 117,376 109,306 8,070 - 3,028 - 305 1,213 1,510 -
Sacramento 18,212 17,284 928 - 278 58 86 192 - 58
Central Valley 45,057 23,977 21,080 - 1,404 930 200 435 769 930
Southbay 41,130 38,706 2,424 - 1,705 - 314 211 1,180 -
Monterey Bay 40,355 38,753 1,602 676 1,018 - 341 57 620 -
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Total California 478,770 386,716 92,054 2,455 22,194 1,457 1,918 4,627 15,649 1,457
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Nevada 27,224 17,770 9,454 - 1,207 167 96 384 727 167
Arizona 30,508 25,719 4,789 - 1,477 - 149 531 797 -
New Mexico 33,561 32,620 941 - 1,358 - 234 1,072 52 -
San Antonio 75,798 75,798 - 1,121 5,369 - 2,473 826 2,070 -
Colorado 36,216 27,292 8,924 - 1,518 - 195 371 952 -
Utah 18,713 17,947 766 - 399 - 141 150 108 -
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Total Other US 222,020 197,146 24,874 1,121 11,328 167 3,288 3,334 4,706 167
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Total United States 700,790 583,862 116,928 3,576 33,522 1,624 5,206 7,961 20,355 1,624
France
Maisons Individuelles 37,585 29,672 7,913 143 824 - 195 145 484 -
KBD 29,265 27,365 1,900 - 145 - 137 - 8 -
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Total France 66,850 57,037 9,813 143 969 - 332 145 492 -
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Mexico 8,871 3,440 5,431 1,524 153 - 18 45 90 -
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Other Properties
Pacific Inland 1,730 1,730 - - 12 - 12 - - -
Illinois 000 - 000 - - 00 - - - 00
Xxxxxx 1,473 - 1,473 - - 140 - - - 140
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Total Other Properties 3,791 1,730 2,061 - 12 236 12 - - 236
-------- -------- -------- ------ ------ ----- ----- ----- ------ -----
Total Inventory $780,302 $646,069 $134,233 $5,243 34,656 1,860 5,568 8,151 20,937 1,860
======== ======== ======== ====== ====== ===== ===== ===== ====== =====
163
SCHEDULE 1.1
COMMITMENTS
Pro Rata Share of Dollar Amount of
----------------------------------------- ---------------------------------------------------
Bank Line A Line B Line A Line B
---- ------ ------ ------ ------
Commitment Commitment Commitments Commitment Commitment Commitments
---------- ---------- ----------- ---------- ---------- -----------
Bank of America 15.0% 15.0% 15.0% $ 60,000,000 $ 15,000,000 $ 75,000,000
NationsBank of Texas 10.0% 10.0% 10.0% $ 40,000,000 $ 10,000,000 $ 50,000,000
Credit Lyonnais 10.0% 10.0% 10.0% $ 40,000,000 $ 10,000,000 $ 50,000,000
Guaranty Federal 9.0% 9.0% 9.0% $ 36,000,000 $ 9,000,000 $ 45,000,000
Societe Generale 9.0% 9.0% 9.0% $ 36,000,000 $ 9,000,000 $ 45,000,000
Union Bank of California 5.0% 5.0% 5.0% $ 20,000,000 $ 5,000,000 $ 25,000,000
Chase Manhattan Bank 7.0% 7.0% 7.0% $ 28,000,000 $ 7,000,000 $ 35,000,000
SunTrust Bank 7.0% 7.0% 7.0% $ 28,000,000 $ 7,000,000 $ 35,000,000
Industrial Bank of Japan 6.0% 6.0% 6.0% $ 24,000,000 $ 6,000,000 $ 30,000,000
First National Bank of Chicago 5.0% 5.0% 5.0% $ 20,000,000 $ 5,000,000 $ 25,000,000
The Bank of New York 5.0% 5.0% 5.0% $ 20,000,000 $ 5,000,000 $ 25,000,000
Comerica Bank 3.0% 3.0% 3.0% $ 12,000,000 $ 3,000,000 $ 15,000,000
Sanwa Bank California 3.0% 3.0% 3.0% $ 12,000,000 $ 3,000,000 $ 15,000,000
Banque Paribas 3.0% 3.0% 3.0% $ 12,000,000 $ 3,000,000 $ 15,000,000
Kredietbank N.V. 3.0% 3.0% 3.0% $ 12,000,000 $ 3,000,000 $ 15,000,000
TOTAL 100.0% 100.0% 100.0% $400,000,000 $100,000,000 $500,000,000
164
SCHEDULE 3.18
XXXXXXX AND BROAD HOME CORPORATION
STAND-BY LETTERS OF CREDIT ISSUED UNDER LINE OF CREDIT
LIN SN-100
FOURTH AMENDED AND RESTATED CREDIT AGREEMENT DATED AS OF FEBRUARY 28, 1996
MATURITY DATE 12/31/97
FINANCIAL SBLC CUMULATIVE
ISSUE PREPAID FEE ISSUED ON OR EXPIRATION SBLC SBLC
GBLC NO. DATE SBLC FEE PREPAID PERIOD BEHALF OF: PERFORMANCE BENEFICIARY DATE AMOUNT TOTAL
------------------------------------------------------------------------------------------------------------------------------------
225881 10/30/95 2,729.72 10/31/96-4/30/97 Xxxxxxx & Broad Financial U.S. Trust of 12/31/97 328,753.61 328,753.61
Multi-Housing California
Group, Inc. N.A.
228020 03/07/96 4,392.36 3/10/97-9/2/97 Xxxxxxx & Broad Financial U.S. Trust of 09/01/97 625,000.00 953,753.61
Mortgage Co. California
N.A.
3000302 06/12/96 9,866.68 2/28/97-9/1/97 Xxxxxxx & Broad Financial First American 08/31/97 1,335,680.00 2,289,433.61
of Arizona, Inc. Title Ins. Co.
3000303 06/12/96 3,010.25 3/1/97-8/31/97 Xxxxxxx & Broad Financial First American 12/31/97 411,952.00 2,701,385.61
of Arizona, Inc. Title Ins. Co.
3002695 12/11/96 36,495.03 12/11/96-6/11/97 Xxxxxxx & Broad Performance Surplus Property 09/30/97 5,500,036.00 8,201.421.61
of Northern Ca. of Alameda
County
3003343 02/04/97 3,646.51 2/4/97-4/22/97 Xxxxxxx & Broad Financial First American 12/31/97 501,765.35 8,703,186.96
of Arizona, Inc. Title Ins.
3003717 02/27/97 21,592.28 2/27/97-8/27/97 Xxxxxxx & Broad Financial Security Title 12/31/97 2,987,545.67 11,690,732.63
of Arizona, Inc. Agency
3004267 04/14/97 3,054.68 4/14/97-10/01/97 Xxxxxxx & Broad Financial CalMat Company 12/31/97 425,000.00 12,115,732.63
Xxxxx Xxx
000
Schedule 4.4
Xxxxxxx and Broad Home Corporation
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
California Corporations
Affordable Multi-Family, Inc. 100
BKJ Construction Company, Inc. 100
Cable Associates, Inc. 100
Custom Decor, Inc. 100
First Northern Builders Servicing, Inc. 100
Fullerton Affordable Housing, Inc. 100
KBASW Mortgage Acceptance Corporation 100 Fi
KBI/Mortgage Acceptance Corporation 100 Fi
KBMH Property Management, Inc. 100
KBMH Capital, Inc. 100
KBRAC IV Mortgage Acceptance Corporation 100 Fi
KBMH Construction, Inc. 100
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 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 S/G
Xxxxxxx and Broad - Xxxxxx/Perris Valleys, Inc. 100
Xxxxxxx and Broad Multi-Family, Inc. 100
Xxxxxxx and Broad Multi-Housing Group, Inc. 100 S/G
Xxxxxxx and Broad of Northern California, Inc. 100 S/G
Xxxxxxx and Broad North Stockton, Inc. 100
Xxxxxxx and Broad Properties 100
166
Xxxxxxx and Broad of San Diego, Inc. 100 S/G
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 S/G
Kent Land Company 100
Kingsbay Escrow Company 100
Multi-Housing Investments, Inc. 100
Colorado Corporation
Xxxxxxx and Broad of Colorado, Inc. 100 S/G
Delaware Corporations
International Mortgage Acceptance Corporation 100
Xxxxxxx and Broad Development Company 100
Xxxxxxx and Broad Limited 100
Illinois Corporations
Xxxxxxx and Broad of Illinois, Inc. 100
Xxxxxxx and Broad Mortgage Company 100 Fi
Massachusetts Corporation
Xxxxxxx and Broad Homes, Inc. 100
Mexican Corporations
Xxxxxxx y Broad de Mexico 100 Fo
Xxxxxxx y Broad Asesoria Administrativa 100 Fo
Michigan Corporation
Keywick, Inc. 100
Minnesota Corporation
Xxxxxxx and Broad Custom Homes, Inc. 100
Nevada Corporation
Xxxxxxx and Broad of Nevada, Inc. 100 S/G
167
New Mexico Corporations
Xxxxxxx and Broad of New Mexico, Inc. 100 S/G
New York Corporation
Xxxxxxx and Broad Homes of Long Island, Inc. 100
Texas Corporations and Partnerships
KBSA Inc. 100
San Antonio Title Co. 100
Satex Properties, Inc. 100
Texas Homestead Mortgage Company 100
Xxxxx-Xxxxxxx Development, Inc. 100
Xxxxx Xxxxxxx of El Paso, Inc. 000
Xxxxxxx xxx Xxxxx xx Xxxxx, Ltd. 100 S/G
Canadian Corporations
Margreen Investments, Inc. 100 Fo
3238865 Canada Inc. 100 Fo
French Corporations
Bati Service Development S.A.R.L. 100 Fo
Bati Service Promotion S.A. 100 Fo
Xxxxxxx and Broad Developpement S.A. 99.4 Fo/S
Xxxxxxx & Broad France S.A. 100 Fo/S
Xxxxxxx and Broad Investissements S.A.R.L. 100 Fo
Xxxxxxx and Broad Maisons Individuelles S.A. 99.94 Fo/S
Xxxxxxx and Broad Rehabilitation S.A.R.L. 99.94 Fo
Xxxxxxx and Broad Renovation S.A. 99.4 Fo
Xxxxxxx and Broad Residences S.A.R.L. 100 Fo
German Corporations
Xxxxxxx and Broad GmbH 100 Fo
168
Schedule 4.7
existing Liens or Rights of Others
as of November 30, 1996
NONE
169
Schedule 4.9
Existing Indebtedness and Contingent Guaranty Obligations
as of November 30, 1996
Amount Total
---------- ---------
$ $
DEBT:
KBHC Secured Debt:
California 2,455,000
Other US 3,121,000
International 1,667,000 7,243,000
KBMC Secured Debt:
Commercial Paper 74,000,000
Mortgage Warehouse Facility 60,956,441 134,956,441
Unsecured Debt:
Senior Debt 10-3/8% 100,000,000
Sub Debt 9-3/8% 173,961,000
Sub Debt 9-5/8% 124,406,000
Revolving Credit Line 30,400,000
Other Unsecured 6,617,000 435,384,000
-----------
Total Debt 577,583,441
===========
CONTINGENT GUARANTEE OBLIGATIONS:
KBHC
Multihousing 2,055,000
Financial Letters of Credit 15,088,862 17,143,862
KBMHG 3,800,000 3,800,000
-----------
Total Contingent Guarantee Obligations 20,943,862
===========
TOTAL DEBT AND CONTINGENT -----------
CONTINGENT GUARANTEE OBLIGATIONS 598,527,303
-----------
170
Schedule 6.4
Investments
as of the Closing Date
NONE
