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CREDIT AGREEMENT
DATED AS OF FEBRUARY 20, 1998
AMONG
THE FUNDS AND PORTFOLIOS PARTIES HERETO,
THE BANKS PARTY HERETO AS LENDERS,
THE BANK OF NOVA SCOTIA, AS SYNDICATION AGENT,
STATE STREET BANK AND TRUST COMPANY, AS OPERATIONS AGENT,
AND
FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT
AND DOCUMENTATION AGENT
Amendment and Restatement of March 15, 2002
FLEET SECURITIES, INC.,
AS SOLE LEAD ARRANGER AND SOLE BOOK MANAGER
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TABLE OF CONTENTS
Page
1. DEFINITIONS, INTERPRETATION OF AGREEMENT AND COMPLIANCE
WITH FINANCIAL RESTRICTIONS.........................................1
1.1 Definitions................................................1
1.2 Other Definitional Provisions.............................10
1.3 Interpretation of Agreement...............................10
1.4 Compliance with Financial Restrictions....................10
1.5 Assumptions Regarding Structure...........................10
1.6 Authority of Adviser; Adviser Disclaimer..................10
2. COMMITMENTS OF THE BANKS AND CERTAIN LOAN TERMS....................11
2.1 Loans.....................................................11
2.2 Loan Options..............................................11
2.3 Borrowing Procedures......................................12
2.4 Continuation and/or Conversion of Loans...................12
2.5 Note Evidencing Loans.....................................13
2.6 Source of Repayment.......................................13
2.7 Extension of Scheduled Termination Date...................14
3. INTEREST AND FEES..................................................14
3.1 Interest..................................................14
3.2 Commitment Fee............................................15
3.3 Method of Calculating Interest and Fees...................15
4. PAYMENTS, PREPAYMENTS, REDUCTION OR TERMINATION OF THE
COMMITMENTS AND SETOFF.............................................15
4.1 Place of Payment..........................................15
4.2 Prepayments...............................................16
4.3 Reduction or Termination of the Commitment Amount.........16
4.4 Setoff....................................................16
4.5 Borrowing Base............................................17
4.6 Payments by the Banks to the Operations Agent.............17
4.7 Sharing of Payments.......................................17
5. ADDITIONAL PROVISIONS RELATING TO LOANS............................18
5.1 Increased Cost............................................18
5.2 Deposits Unavailable or Interest Rate Unascertainable or
Inadequate; Impracticability..............................19
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TABLE OF CONTENTS
(continued)
Page
5.3 Changes in Law Rendering Eurodollar Loans Unlawful........19
5.4 Discretion of the Bank as to Manner of Funding............20
5.5 Funding Losses............................................20
5.6 Capital Adequacy..........................................20
5.7 Additional Provisions with Respect to Federal Funds
Rate Loan.................................................21
6. WARRANTIES.........................................................21
6.1 Existence.................................................21
6.2 Authorization.............................................21
6.3 No Conflicts..............................................21
6.4 Xxxxxxxx and Xxxxxxx Effect...............................22
6.5 No Default................................................22
6.6 Financial Statements......................................22
6.7 Litigation................................................22
6.8 Liens.....................................................22
6.9 Partnerships..............................................23
6.10 Purpose...................................................23
6.11 Compliance................................................23
6.12 Xxxxxxx and Welfare Plans.................................23
6.13 Taxes.....................................................23
6.14 Subsidiaries; Investments.................................23
6.15 Full Disclosure...........................................24
6.16 Investment Policies.......................................24
7. COVENANTS..........................................................24
7.1 Financial Statements and Other Reports....................24
7.2 Notices...................................................25
7.3 Existence.................................................26
7.4 Nature of Business........................................27
7.5 Books, Records and Access.................................27
7.6 Insurance.................................................27
7.7 Dividends.................................................27
7.8 Investment Policies and Restrictions......................27
7.9 Taxes.....................................................28
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TABLE OF CONTENTS
(continued)
Page
7.10 Compliance................................................28
7.11 Pension Plans.............................................28
7.12 Xxxxxx, Xxxxxxxx and Sale.................................28
7.13 Asset Coverage Ratio......................................29
7.14 Liens.....................................................29
7.15 Guaranties................................................29
7.16 Other Agreements..........................................29
7.17 Transactions with Related Parties.........................30
7.18 Payment of Management Fees................................30
7.19 Other Indebtedness........................................30
7.20 Changes to Trust Agreement, etc...........................30
7.21 Violation of Investment Restrictions, etc.................30
7.22 Proceeds of Loans.........................................30
8. CONDITIONS PRECEDENT TO ALL LOANS..................................30
8.1 Notice....................................................31
8.2 Default...................................................31
8.3 Warranties................................................31
8.4 Certification.............................................31
8.5 Borrowing Certificate.....................................31
8.6 Minimum Net Asset Value...................................31
9. CONDITIONS PRECEDENT TO AND CONSEQUENCES OF
EFFECTIVENESS OF AMENDMENTS........................................31
9.1 Notes.....................................................31
9.2 Officer's Certificate.....................................32
9.3 Incumbency Certificate....................................32
9.4 Opinions..................................................32
9.5 Net Asset Value Certificate...............................32
9.6 Consent of Investment Adviser.............................32
9.7 Form U-1..................................................32
9.8 Consequences of Effectiveness.............................32
10. ADDITION OF NEW PARTIES............................................33
10.1 New Parties...............................................33
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TABLE OF CONTENTS
(continued)
Page
11. EVENTS OF DEFAULT AND REMEDIES.....................................33
11.1 Events of Default.........................................33
11.2 Remedies..................................................35
12. THE AGENTS.........................................................35
12.1 Appointment and Authorization.............................36
12.2 Delegation of Duties......................................36
12.3 Liability of Agent........................................36
12.4 Reliance by Agent.........................................36
12.5 Notice of Event of Default................................37
12.6 Credit Decision...........................................37
12.7 Indemnification of Agents.................................37
12.8 Agents in Individual Capacity.............................38
12.9 Successor Agent...........................................38
13. GENERAL............................................................39
13.1 Waiver and Amendments.....................................39
13.2 Notices...................................................39
13.3 Expenses..................................................40
13.4 Funds Indemnification.....................................40
13.5 Information...............................................41
13.6 Severability..............................................41
13.7 Law.......................................................41
13.8 Successors................................................42
13.9 Waiver of Jury Trial......................................43
13.10 Disclaimer................................................43
13.11 Acknowledgments...........................................43
13.12 Other.....................................................43
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ANNEX I - LIST OF CURRENT BORROWER PARTIES, CONTINUING
BORROWER PARTIES AND NON-CONTINUING PARTIES
CREDIT AGREEMENT
This document, dated as of March 15, 2002 amends and restates that
certain CREDIT AGREEMENT, dated as of February 20, 1998 (as amended as of
February 19, 1999, March 19, 1999, March 17, 2000 and March 16, 2001, the
"Existing Agreement"), and is entered into among each of the funds (each, a
"Fund") a party hereto or that may become a party hereto pursuant to the terms
hereof, the various banks as are or may become party hereto pursuant to the
terms hereof (individually, a "Bank" and, collectively, the "Banks"), FLEET
NATIONAL BANK ("Fleet"), a national banking association, as administrative agent
(in such capacity, the "Administrative Agent") and documentation agent (in such
capacity, the "Documentation Agent") for the Banks, and STATE STREET BANK AND
TRUST COMPANY ("State Street"), a Massachusetts trust company, as operations
agent (in such capacity, the "Operations Agent") for the Banks.
WHEREAS, the Funds (either on their own behalf or on behalf of certain
specified Portfolios) identified on Annex I hereto listed under the heading
Current Borrower Parties (the "Current Borrower Parties") are parties to the
Existing Agreement;
WHEREAS, the Funds (either on their own behalf or on behalf of certain
specified Portfolios) identified on Annex I hereto listed under the heading
Continuing Borrower Parties (the "Continuing Borrower Parties"), certain of the
Banks party to the Existing Agreement, the Administrative Agent and
Documentation Agent and the Operations Agent desire to amend the Existing
Agreement to acknowledge that LM Total Return Trust, Inc. and LM Value
Institutional Portfolio will not continue as parties hereto, to acknowledge that
the name of LM Institutional Fund Advisors II, Inc. has been changed to Xxxx
Xxxxx Xxxxxxx Street Trust, Inc., to extend the Termination Date, to acknowledge
that Commerzbank AG, New York Branch will not continue as a Bank hereunder, to
add as Banks hereunder The Bank of Nova Scotia and The Bank of New York and to
effect other changes to the Existing Agreement as hereinafter provided;
WHEREAS, in order to facilitate the aforesaid amendments, it is
desirable to amend and restate the Existing Agreement on the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:
1. DEFINITIONS, INTERPRETATION OF AGREEMENT AND COMPLIANCE WITH
FINANCIAL RESTRICTIONS.
1.1 Definitions. In addition to the terms defined elsewhere in
this Agreement, the following terms shall have the meanings indicated for
purposes of this Agreement (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
"Act" means the Investment Company Act of 1940, as amended,
modified, or supplemented from time to time, and all rules and regulations
promulgated thereunder, and any successor statute and associated regulations.
"Administrative Agent" has the meaning assigned to such term
in the introductory paragraph of this Agreement.
"Adviser" means Xxxx Xxxxx Fund Adviser, Inc., Xxxx Xxxxx
Funds Management, Inc. or LMM LLC, as the case may be, as investment adviser or
manager to a Fund or a Portfolio together with any successor thereto permitted
by Section 7.2(f) hereof.
"Adviser Persons" is defined in Section 1.6.
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person. A Person shall be deemed to control another Person if
the controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests, by contract,
or otherwise.
"Agent" means the Administrative Agent, the Documentation
Agent or the Operations Agent.
"Agent-Related Persons" means any Agent and any successor
Agent arising under Section 12.9, together with its respective Affiliates, and
the officers, directors, employees, agents and attorneys-in-fact of such Person
and its Affiliates.
"Agreement" means this Credit Agreement, as it may be
amended, restated, modified and/or supplemented from time to time.
"Arranger" means Fleet Securities, Inc., as sole lead arranger
and sole book manager.
"Asset Coverage Ratio" means, with respect to any Fund or
Portfolio (as the case may be) at any time, the ratio which the value of the
Total Assets of such Fund or Portfolio (reduced by the value of assets subject
to Liens) at such time less all liabilities and Indebtedness not represented by
Senior Securities of such Fund or Portfolio, bears to the aggregate amount of
Senior Securities Representing Indebtedness of such Fund or Portfolio at such
time.
"Assignee" has the meaning assigned to such term in Section
13.8(b).
"Assignment and Acceptance" has the meaning assigned to such
term in Section 13.8(b).
"Attorney Costs" means and includes any and all reasonable
fees and disbursements of any law firm or other external counsel, the reasonable
allocated cost of internal legal services and all disbursements of internal
counsel.
"Bank" and "Banks" have the meanings assigned to such terms in
the introductory paragraph of this Agreement.
"Banking Day" means any day other than a Saturday, Sunday or
legal holiday on which banks are authorized or required to be closed in Boston,
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Massachusetts, New York, New York and, with respect to Eurodollar Loans, a day
on which dealings in Dollars may be carried on by the Operations Agent in the
interbank eurodollar market.
"Borrowing" means a borrowing hereunder consisting of Loans of
the same type made to a Fund or Portfolio on the same day by the Banks under
Section 2 and, other than in the case of Federal Funds Rate Loans, having the
same Interest Period.
"Borrowing Base" means the amount defined as such in Section
4.5 with respect to each Fund or Portfolio, as the case may be.
"Borrowing Base Certificate" means a Borrowing Base
Certificate as defined in Section 7.1(c).
"Borrowing Certificate" means a certificate provided by a Fund
or Portfolio, in the form of Exhibit A hereto.
"Capitalized Lease" of any Person means all monetary
obligations of such Person under any leasing or similar arrangement which, in
accordance with GAAP, are or would be classified as capitalized leases on a
balance sheet of such Person.
"Change in Control" means any transaction or series of
transactions where (i) any "person" (as such term is used in Section 13(d) and
14(d) of the Securities Exchange Act of 1934 (the "Exchange Act") as in effect
on the date hereof) becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act, as in effect on the date hereof), directly or
indirectly, of securities of another Person (the "Target") representing 25% or
more of the combined voting power of the Target's then-outstanding securities;
(ii) at any time less than a majority of the members of the Target's board of
directors shall be persons who were either nominated for election or were
elected by such board of directors; (iii) the Target's stockholders approve a
merger or consolidation of the Target with any other Person, other than a merger
or consolidation that would result in the voting securities of the Target
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least 75% of the combined voting power of the voting
securities of the Target or such surviving entity outstanding immediately after
such merger or consolidation; or (iv) the Target's stockholders approve a plan
of complete liquidation of the Target or an agreement for the sale or
disposition of all or substantially all of the Target's assets; provided that a
Change in Control will not be deemed to occur when, after such transaction or
series of transactions, the Target would be controlled, directly or indirectly,
by Xxxx Xxxxx, Inc.
"Code" means the Internal Revenue Code of 1986 and any
successor statute of similar import, together with the regulations thereunder,
in each case as in effect from time to time. References to sections of the Code
shall be construed to also refer to any successor sections.
"Commitment" means, relative to any Bank, such Bank's
obligation to make Loans pursuant to Section 2.1.
"Commitment Amount" means, on any date, $300,000,000, as such
amount may be reduced from time to time pursuant to Section 4.3.
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"Continuing Borrower Parties" has the meaning assigned to such
term in the recitals hereof.
"Credit Documents" means this Agreement, any Notes and all
other documents delivered to any Agent or any Bank in connection herewith.
"Current Borrower Parties" has the meaning assigned to such
term in the recitals hereof.
"Documentation Agent" has the meaning assigned to such term in
the introductory paragraph of this Agreement.
"Dollars" and the symbol "$" mean lawful money of the United
States of America.
"Eligible Lender" means an entity that is a "bank" (as such
term is defined in the Act), but not an "affiliated person," "principal
underwriter" or "promoter" (as such terms are defined in the Act) of any Fund or
Portfolio or an "affiliated person" (as such term is defined in the Act) of any
of the above.
"Eurocurrency Reserve Requirement" means, with respect to any
Eurodollar Loan for any Interest Period, a percentage equal to the daily average
during such Interest Period of the percentages in effect on each day of such
Interest Period, as prescribed by the Federal Reserve Board (or any successor),
for determining the aggregate maximum reserve requirements (including all basic,
supplemental, marginal and other reserves) applicable to "Eurocurrency
liabilities" pursuant to Regulation D or any other then applicable regulation of
the Federal Reserve Board (or any successor) which prescribes reserve
requirements applicable to "Eurocurrency liabilities," as presently defined in
Regulation D. Without limiting the effect of the foregoing, the Eurocurrency
Reserve Requirement shall reflect any other reserves required to be maintained
against (i) any category of liabilities that includes deposits by reference to
which LIBOR (Reserve Adjusted) is to be determined or (ii) any category of
extensions of credit or other assets that includes the Loans. For purposes of
this Agreement, any Eurodollar Loan hereunder shall be deemed to be
"Eurocurrency liabilities," as defined in Regulation D, and, as such, shall be
deemed to be subject to such reserve requirements without the benefit of, or
credit for, proration, exceptions or offsets which may be available from time to
time under Regulation D.
"Eurodollar Loan" means any Loan which bears interest at a
rate determined with reference to LIBOR (Reserve Adjusted).
"Eurodollar Margin" means 0.50%.
"Event of Default" means any of the events described in
Section 11.1.
"Exchange Act" has the meaning assigned to such term in the
definition of the term Change in Control.
"Existing Agreement" has the meaning assigned to such term in
the introductory paragraph of this Agreement.
4
"Federal Funds Rate" means, for any day, the rate per annum as
quoted by the Federal Reserve Bank of New York and confirmed in the daily
statistical release designated as H.15, or any successor publication, published
by the Federal Reserve Bank of New York (including any such successor "H.15")
for the preceding Banking Day opposite the caption "Federal Funds (Effective)";
or, if for any relevant day such rate is not so published on any such preceding
Banking Day, the rate for such day will be the arithmetic mean as determined by
the Operations Agent of the rates for the last transaction in overnight Federal
funds arranged prior to 9:00 a.m. (New York City time) on that day by each of
three leading brokers of Federal funds transactions in New York City selected by
the Operations Agent.
"Federal Funds Rate Loan" means any loan which bears interest
at a rate determined with reference to the Federal Funds Rate.
"Federal Funds Rate Margin" means 0.50%.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System.
"Fee Payment Date" means, as to any fees, the last day of each
March, June, September and December, commencing on the first such date to occur
after the date hereof.
"Fiscal Year" means each fiscal year of any Fund or Portfolio,
as the case may be. References to a Fiscal Year with a number corresponding to
any calendar year (e.g. "Fiscal Year 1994") refer to the Fiscal Year ending on a
date occurring during such calendar year.
"Fleet" has the meaning assigned to such term in the
introductory paragraph of this Agreement.
"Fund" has the meaning assigned to such term in the
introductory paragraph of this Agreement.
"GAAP" means generally accepted accounting principles as
applied in the preparation of the financial statements of the Funds and
Portfolios referred to in Section 6.6.
"Indebtedness" of any Person means, without duplication, (i)
any obligation of such Person for borrowed money, including, without limitation,
(a) any obligation of such Person evidenced by bonds, debentures, notes or other
similar debt instruments or arising out of a reverse repurchase transaction, and
(b) any obligation for borrowed money which is non-recourse to the credit of
such Person but which is secured by a Lien on any asset of such Person; (ii) any
obligation of such Person on account of deposits or advances; (iii) any
obligation of such Person for the deferred purchase price of any property or
services, except Trade Accounts Payable and investments purchased on a forward
delivery basis; (iv) any obligation of such Person as lessee under a Capitalized
Lease; (v) any Indebtedness of another Person secured by a Lien on any asset of
such first Person, whether or not such Indebtedness is assumed by such first
Person; and (vi) any guaranty or other contingent liability, direct or indirect,
with respect to any obligation of another Person, except for the endorsement of
5
items for collection in the ordinary course of such first Person's business. For
all purposes of this Agreement, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture in which such Person is a
general partner or joint venturer.
"Indemnification Agreement" means that certain indemnification
agreement dated March 15, 2002 among the Funds and Portfolios substantially in
the form of Exhibit K.
"Indemnified Liabilities" has the meaning assigned to such
term in Section 13.4.
"Indemnified Person" has the meaning assigned to such term in
Section 13.4.
"Interest Period" means with respect to any Eurodollar Loan,
the period commencing on the Borrowing date of such Eurodollar Loan, and ending
on the date which is one day, one week, two weeks or three weeks later, as the
case may be (in each case as selected by the applicable Fund or Portfolio, as
the case may be, pursuant to Section 2.3 or Section 2.4); provided, however,
that:
(a) any Interest Period which would otherwise end on a day
which is not a Banking Day shall end on the next succeeding Banking Day
unless such next succeeding Banking Day falls in another calendar
month, in which case such Interest Period shall end on the next
preceding Banking Day; and
(b) no Interest Period shall extend beyond the Termination
Date.
"LIBOR," applicable to any Interest Period, means the rate of
interest for the relevant tenor offered for deposits in U.S. dollars, rounded to
the nearest 1/100 of 1%, that appears on Telerate Page 3750 at approximately
11:00 a.m. (London time) on the second Banking Day immediately preceding the day
on which such Interest Period commences (the "LIBOR Reset Date"). If such
reference is not available, then LIBOR shall mean the arithmetic mean, rounded
to the nearest 1/100 of 1%, of quotes for deposits in U.S. dollars of the
relevant tenor from four major banks in London selected by the Operations Agent
at approximately 11:00 a.m. (London time) on the Interbank Reset Date. "Telerate
Page 3750" shall mean the display page currently designated as such on the Dow
Xxxxx Telerate Service (or such other page as may replace that page on that
service for the purpose of displaying comparable rates or prices).
"LIBOR (Reserve Adjusted)" means, with respect to each
Interest Period for a Eurodollar Loan, a rate per annum (rounded upward to the
nearest 1/100 of 1%) determined pursuant to the following formula:
LIBOR = LIBOR
(Reserve Adjusted) 1 - Eurocurrency Reserve Requirement
LIBOR shall be adjusted automatically as to all Eurodollar Loans then
outstanding as of the effective date of any change in the Eurocurrency Reserve
Requirement.
"Lien" means any mortgage, pledge, hypothecation, judgment
lien or similar legal process, title retention lien, or other lien or security
interest, including, without limitation, the interest of a vendor under any
conditional sale or other title retention agreement and the interest of a lessor
6
under any Capitalized Lease. The term Lien shall not include the property
interest acquired by a counterparty in connection with a securities repurchase
agreement between a Fund or Portfolio, as the case may be, and a counterparty.
"Loan" means a loan by a Bank to a Fund or Portfolio, as the
case may be, pursuant to Section 2.1, and shall be a Federal Funds Rate Loan or
a Eurodollar Loan (each of which shall be a "type" of Loan).
"Majority Banks" means, at any time, at least two Banks then
holding at least 66-2/3% of the then aggregate unpaid principal amount of the
Loans or, if no such principal amount is then outstanding, at least two Banks
then having at least 66-2/3% of the Commitments.
"Material Adverse Change" means any change that the Majority
Banks determine to be material and adverse to (x) the condition (financial or
otherwise), business or prospects of a Fund or Portfolio, as the case may be, or
(y) the ability of a Fund or Portfolio, as the case may be, to duly and
punctually pay and perform all or any of its obligations under this Agreement or
the relevant Notes; provided, however, that if a Fund's or a Portfolio's Asset
Coverage Ratio equals or exceeds 6 to 1, a Material Adverse Change shall not
have occurred.
"Material Adverse Effect" means a material and adverse effect
on (i) the condition (financial or other), business, operations or prospects of
a Fund or Portfolio, as the case may be, or (ii) the ability of a Fund or
Portfolio, as the case may be, to duly and punctually pay and perform its
obligations under this Agreement and its Note.
"Net Asset Value" means, at any date, Total Assets less Total
Liabilities.
"Note" means the promissory note of a Fund or Portfolio, as
the case may be, substantially in the form set forth as Exhibit B or Exhibit
B-1, as appropriate, as such promissory note may be amended, modified or
supplemented from time to time, and the term "Note" shall include any
substitutions for, or renewals of, such promissory note.
"Operations Agent" has the meaning assigned to such term in
the introductory paragraph of this Agreement.
"Operations Agent Letter" means that certain letter agreement
dated February 21, 2002 among the Operations Agent and the Funds and Portfolios.
"Operations Agent's Payment Office" means the address for
payments set forth on Schedule II hereto in relation to the Operations Agent or
such other address as the Operations Agent may from time to time specify.
"Originating Bank" has the meaning assigned to such term in
Section 13.8(c).
"Participant" has the meaning assigned to such term in Section
13.8(c).
"Person" means an individual, partnership, corporation, trust,
joint venture, joint stock company, association, unincorporated organization,
government or agency or political subdivision thereof, or other entity.
7
"Plan" means any "pension plan" or "welfare benefit plan," as
such terms are defined in the Employee Retirement Income Security Act of 1974,
as amended, or any successor statute.
"Portfolio" means each series or class of shares of a Fund
that constitutes a "series" under the Act, which is a signatory to this
Agreement or any amendment hereto or which such Fund has previously identified
to the Banks as a Portfolio in a certificate in the form of Exhibit C and has
been approved by the Banks hereunder.
"Pro Rata Share" means, as to any Bank at any time, the
percentage equivalent (expressed as a decimal, rounded to the ninth decimal
place) at such time of such Bank's Commitment divided by the combined
Commitments of all Banks, as set forth on Schedule I, as such amount may be
adjusted from time to time as a result of an assignment made by such Bank
pursuant to Section 13.8 or otherwise.
"Reference Rate" means, at any time, the rate of interest then
most recently announced by the State Street at Boston, Massachusetts as its
prime rate. It is a rate set by State Street based upon various factors
including State Street's costs and desired return, general economic conditions
and other factors, and is used as a reference point for pricing some loans.
Loans may be priced at, above or below the Reference Rate. Any change in the
Reference Rate shall take effect at the opening of business on the date
specified in the public announcement of such change.
"Refinancing" means the refinancing of the Agreement as
contemplated by this amendment and restatement of the Existing Agreement.
"Refinancing Date" has the meaning assigned to such term in
Section 9.
"Related Party" means, with respect to a Fund or Portfolio, as
the case may be, and for purposes of Section 7.17 only, any Person (i) which
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such Fund or Portfolio, (ii)
which beneficially owns or holds 5% or more of the equity interest of such Fund
or Portfolio or (iii) 5% or more of the equity interest of which is beneficially
owned or held by such Fund or Portfolio. The term "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Senior Security" means any bond, debenture, note, or similar
obligation or instrument constituting a security and evidencing indebtedness,
and any stock of a class having priority over any other class as to distribution
of assets or payment of dividends.
"Senior Security Representing Indebtedness" means any Senior
Security other than stock.
"State Street" has the meaning assigned to such term in the
introductory paragraph of this Agreement.
"Subsidiary" means, with respect to a Fund or Portfolio, as
8
the case may be, (i) any corporation more than 50% of whose stock of any class
or classes having by the terms thereof ordinary voting power to elect a majority
of the directors of such corporation (irrespective of whether or not at the time
stock of any class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at the time owned
by the Fund or Portfolio and/or one or more Subsidiaries of such Fund or
Portfolio and (ii) any partnership, association, joint venture or other entity
in which such Fund or Portfolio and/or one or more Subsidiaries of such Fund or
Portfolio has more than a 50% equity interest at the time.
"Syndication Agent" means The Bank of Nova Scotia.
"Target" has the meaning assigned to such term in the
definition of the term Change in Control.
"Taxes" with respect to any Person means taxes, assessments or
other governmental charges or levies imposed upon such Person, its income or any
of its properties, franchises or assets.
"Termination Date" means March 14, 2003, or such earlier date
as may be fixed by the Funds and Portfolios on at least 15 Banking Days' prior
written or telephonic notice received by the Administrative Agent and
Documentation Agent. The Funds and Portfolios shall promptly confirm any
telephonic notice in writing. Upon the request of the Funds and Portfolios, and
in the Banks' sole discretion, the Termination Date may be extended for
successive 364-day periods as provided in Section 2.7.
"Total Assets" means, with respect to a Fund or Portfolio, as
the case may be, as of any date, an amount equal to the aggregate fair market
value of all items which would be set forth as assets on a balance sheet of such
Fund or Portfolio on such date in accordance with GAAP. "Fair market value," for
purposes of this definition, shall be determined as follows: each portfolio
security traded on a national securities exchange or traded over-the-counter and
quoted on the Nasdaq National Market (or similar quotation system providing
daily quotations with respect to the last sale prices of traded securities)
shall be valued at the last sale price on the date of valuation; provided that
any security so traded and quoted for which there was no sale on the date of
valuation, and securities traded over-the-counter but not quoted on the Nasdaq
National Market or any such similar quotation system, shall be valued at an
amount equal to the arithmetic mean of the most recent available bid and asked
quotations therefor, except that debt securities not traded on a national
securities exchange nor quoted on the Nasdaq National Market or any such similar
quotation system shall be assigned such values as shall be determined with
respect thereto by the pricing service or services normally utilized by such
Fund or Portfolio to determine the fair market value of such securities, or, if
any such pricing service does not provide a value for such asset, then the value
of such asset shall be determined in accordance with the Fund's or Portfolio's
standard procedures. Upon the written request of the Operations Agent, a Fund or
Portfolio shall promptly furnish all such information as the Operations Agent
shall reasonably request relating to the value of any portfolio security or
other asset of such Fund or Portfolio or the assignment of values thereto by
such Fund or Portfolio or any other Person.
"Total Liabilities" means, with respect to a Fund or Portfolio
9
as of any date, the aggregate amount of all items which would be set forth as
liabilities on a balance sheet of such Fund or Portfolio on such date in
accordance with GAAP.
"Trade Accounts Payable" of any Person means trade accounts
payable of such Person with a maturity of not greater than ninety (90) days
incurred in the ordinary course of such Person's business.
"Trust Agreement" means, with respect to a Fund that is a
business trust, such Fund's Declaration of Trust, as amended from time to time.
"Unmatured Event of Default" means any event or condition
which, with the lapse of time or giving of notice to a Fund or a Portfolio, or
both, would constitute an Event of Default.
1.2 Other Definitional Provisions. Unless otherwise defined or
the context otherwise requires, all financial and accounting terms used herein
or in any certificate or other document made or delivered pursuant hereto shall
be defined in accordance with GAAP. Unless otherwise defined therein, all terms
defined in this Agreement shall have the defined meanings when used in a Note or
in any certificate or other document made or delivered pursuant hereto.
1.3 Interpretation of Agreement. A Section or an Exhibit is,
unless otherwise stated, a reference to a section hereof or an exhibit hereto,
as the case may be. Section captions used in this Agreement are for convenience
only, and shall not affect the construction of this Agreement. The words
"hereof," "herein," "hereto," and "hereunder" and words of similar purport when
used in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. Unless expressly indicated otherwise,
when used in this Agreement (including the Schedules and Exhibits hereto) "from"
means "from and including" and "to" means "to but excluding". Unless expressly
indicated otherwise, when used in this Agreement (including the Schedules and
Exhibits hereto) "to the best of a Person's knowledge" means "to the best of
such Person's knowledge after due inquiry".
1.4 Compliance with Financial Restrictions. Compliance with
each of the financial ratios and restrictions contained in Section 7 shall,
except as otherwise provided herein, be determined in accordance with GAAP
consistently followed.
1.5 Assumptions Regarding Structure. The parties acknowledge
and agree that certain of the Funds under this Agreement are comprised of
separate Portfolios and that such Portfolios are not separately existing legal
entities entitled to enter into contractual agreements or to execute instruments
and, for these reasons, the relevant Funds are executing this Agreement and the
relevant Notes on behalf of their specified respective Portfolios.
1.6 Authority of Adviser; Adviser Disclaimer. Each of the
Funds and Portfolios hereby confirms that its Adviser has been duly authorized
to act on behalf of such Fund or Portfolio for purposes of this Agreement and
the relevant Note and to take all actions which such Fund or such Portfolio is
entitled or required to take hereunder or thereunder, including, without
limitation, requesting the making, continuation or conversion of Loans on behalf
of a Fund or Portfolio pursuant to Section 2, reducing or terminating the
Commitment as to one or more Funds or Portfolios, and executing and delivering
10
Borrowing Certificates, Borrowing Base Certificates and any and all other
certificates, reports, financial information and notices required to be
delivered to the Agents and/or the Banks hereunder. Notwithstanding the
foregoing or anything to the contrary contained in this Agreement, the parties
hereto acknowledge and agree that (a) in taking any such action hereunder or
under a Note the Adviser is acting solely in its capacity as investment adviser
for the Funds and Portfolios and not in its individual capacity and (b) neither
the Adviser nor any of its officers, employees or agents (with the Adviser,
collectively, "Adviser Persons") shall have any liability whatsoever to any Bank
or Agent for any action taken or omitted to be taken by any of them in
connection with this Agreement or any Note nor shall any of them be bound by or
liable for any indebtedness, liability or obligation hereunder or under the Note
and (c) no Adviser Person shall be responsible in any manner to the Agents or
the Banks for the truth, completeness or accuracy of any statement,
representation, warranty or certification contained in this Agreement or in any
information, report, certificate or other document furnished by the Adviser on
behalf of any Fund or Portfolio in connection with this Agreement, including,
without limitation, any Borrowing Certificate, any Borrowing Base Certificate,
and any certificate or notice furnished pursuant to Section 7.1 or 7.2 hereof;
provided that, in the case of clauses (b) and (c) above, the conduct of the
Adviser Persons or any of them did not constitute negligence, misconduct or a
breach of any obligation to any Fund or Portfolio.
2. COMMITMENTS OF THE BANKS AND CERTAIN LOAN TERMS.
2.1 Loans. Subject to the terms and conditions of this
Agreement and in reliance upon the warranties of each of the Funds set forth
herein, each Bank severally agrees to make individual loans (collectively called
the "Loans" and individually called a "Loan") to the Funds or, in the case of a
Fund comprised of one or more Portfolios, to such Portfolios as are shown on the
signature pages hereof or which are designated in the manner specified in
Section 10.1, in immediately available funds, as designated in a Borrowing
Certificate provided pursuant to Section 2.3, which Loans each Fund or
Portfolio, as the case may be, may repay and reborrow during the period from the
date hereof to, but not including, the Termination Date. Notwithstanding the
foregoing, the parties hereto agree that any breach of a warranty by a Fund or
Portfolio will not alter the Banks' obligations to make Loans to any other Fund
or Portfolio. The commitment of each Bank and the outstanding principal amount
of Loans made by each Bank hereunder shall not exceed at any time the aggregate
amount set forth on Schedule I (such amount as the same may be reduced under
Section 4.3 or as a result of one or more assignments as permitted herein, the
Bank's "Commitment"); provided, however, that, after giving effect to any
Borrowing, the aggregate principal amount of all outstanding Loans shall not at
any time exceed the Commitment Amount; and provided, further, that the aggregate
principal amount of all Loans outstanding from time to time to any Fund or
Portfolio, as the case may be, shall not exceed the Borrowing Base for such Fund
or Portfolio.
2.2 Loan Options. Each Loan shall be either a Federal Funds
Rate Loan or a Eurodollar Loan, as shall be selected by the relevant Fund or
Portfolio, except as otherwise provided herein. Any combination of types of
Loans may be outstanding at the same time, except that no more than three Loans
having different Interest Periods may be outstanding at any one time with
respect to each Fund or, with respect to a Fund comprised of Portfolios, each
Portfolio of that Fund.
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2.3 Borrowing Procedures.
(a) Notice to Operations Agent. A Fund or Portfolio shall give the
Operations Agent prior written or telephonic notice of each Loan, which shall be
received by the Operations Agent, in the case of a Federal Funds Rate Loan, not
later than 12:00 noon, Eastern time, on the Borrowing date with respect to such
Loan, or, in the case of a Eurodollar Loan, not later than 12:00 noon, Eastern
time, three (3) Banking Days prior to the Borrowing date with respect to such
Loan. Each such notice shall specify (i) the Borrowing date (which shall be a
Banking Day), (ii) the amount and type of Loan, (iii) the initial Interest
Period for such Loan, and (iv) in the case of a Fund with Portfolios, the name
of the Portfolio that will utilize the proceeds of such Loan. Each Loan shall be
in a minimum amount of $500,000 or in an integral multiple of $100,000 in excess
thereof. The relevant Fund or Portfolio shall promptly confirm each such
telephonic notice in writing by providing to the Operations Agent a Borrowing
Certificate signed by such Fund's or Portfolio's Treasurer or Assistant
Treasurer or a designated officer of the Adviser, on behalf of the Fund or
Portfolio (it being understood, however, that the Fund's, the Portfolio's or the
Adviser's failure to confirm any telephonic notice or otherwise comply with the
provisions of this Section 2.3 shall not affect the obligation of the relevant
Fund or Portfolio to repay each Loan in accordance with the terms of this
Agreement and the relevant Notes). In the event that more than one Loan request
is made on any Banking Day, the Operations Agent shall, for purposes of ensuring
that the aggregate of the then-outstanding Loans and the Loans which are the
subject of Loan requests will not exceed the Commitment Amount, process the Loan
requests in the order of receipt.
(b) Notice to Banks. The Operations Agent will promptly notify each
Bank of its receipt of any Loan request and of the amount of such Bank's Pro
Rata Share of the requested Loan.
(c) Transfers to Operations Agent. Each Bank will make the amount of
its Pro Rata Share of each Loan available to the Operations Agent for the
account of the borrowing Fund or Portfolio at the Operations Agent's Payment
Office by 2:00 p.m. (Eastern time) on the Borrowing date requested by the
borrowing Fund or Portfolio in funds immediately available to the Operations
Agent for deposit to the account which the Operations Agent shall from time to
time specify by notice to the Banks. The proceeds of all such Loans will then be
made available to the borrowing Fund or Portfolio by the Operations Agent in
accordance with written instructions provided to the Operations Agent by the
Fund or Portfolio in like funds as received by the Operations Agent. No Bank's
obligation to make any Loan shall be affected by any other Bank's failure to
make any Loan.
(d) Disbursement to Fund or Portfolio. The Operations Agent will pay to
the relevant Fund or Portfolio the amount of each Loan on the date specified in
the notice of Borrowing with respect to such Loan upon satisfaction of the
applicable conditions precedent with respect to such Loan.
2.4 Continuation and/or Conversion of Loans. A Fund or
Portfolio may elect to continue an outstanding Eurodollar Loan into a subsequent
Interest Period to begin on the day following the last day of such current
Interest Period or convert a Eurodollar Loan into a Federal Funds Rate Loan by
giving the Operations Agent prior written or telephonic notice of such
12
continuation or conversion, which shall be received by the Operations Agent not
later than 12:00 noon, Eastern time, three (3) Banking Days prior to the
effective date of any continuation or conversion which results in a Eurodollar
Loan or 12:00 noon, Eastern time, on the date of conversion with respect to such
Loan that is to be continued as a Federal Funds Rate Loan; provided that no Loan
(which, for the avoidance of doubt, shall include any Loan proposed to be
converted to a Loan of another type) shall be outstanding for a period of more
than twenty-one (21) days; and provided, further, that there shall be no more
than three Interest Periods in respect of any Eurodollar Loan. Each such notice
shall specify (a) the effective date of continuation or conversion (which shall
be a Banking Day), (b) the amount of such Loan, and (c) the Interest Period for
such Loan. The Fund or Portfolio making such an election shall promptly confirm
each such telephonic notice in writing by providing the Operations Agent a new
Borrowing Certificate signed by the relevant Fund's or Portfolio's Treasurer or
Assistant Treasurer or a designated officer of the Adviser, on behalf of such
Fund or Portfolio. Absent timely notice of continuation or conversion, each
Eurodollar Loan shall automatically convert into a Federal Funds Rate Loan on
the last day of the current Interest Period for such Loan unless paid in full on
such last day. At any time that an Event of Default or an Unmatured Event of
Default shall exist, any Loans may be converted or continued only as Federal
Funds Rate Loans. The Operations Agent will promptly notify each Bank of its
receipt of a request to convert or continue a Loan. All conversions and
continuations shall be made ratably according to the respective outstanding
principal amounts of the Loans with respect to which the notice was given held
by each Bank.
2.5 Note Evidencing Loans. The Loans made to a Fund or
Portfolio by each Bank under its Commitment shall be evidenced by a Note, which
shall be dated as of the date hereof and shall mature (unless accelerated
pursuant to Section 11.2) on the Termination Date. All Loans made by the Banks
to a Fund or Portfolio pursuant to this Agreement and all payments of principal
shall be evidenced by the Banks in their records which records shall be
rebuttably presumptive evidence of the subject matter thereof. Each Fund and
Portfolio shall repay to the Banks in full on the Termination Date the aggregate
amount of Loans to such Fund or Portfolio outstanding on such date. Moreover,
each Fund and Portfolio shall repay (i) each Eurodollar Loan made to such Fund
or Portfolio on the last day of the relevant Interest Period for such Eurodollar
Loan and (ii) each Federal Funds Rate Loan made to such Fund or Portfolio no
later than the twenty-first day after the day on which such Federal Funds Rate
Loan was made.
2.6 Source of Repayment.
(a) Notwithstanding any other provision of this Agreement, the parties
agree that the assets and liabilities of each Portfolio of a Fund are separate
and distinct from the assets and liabilities of each other Portfolio of that
Fund. No Portfolio or Fund shall be liable or shall be charged for any debt,
obligation, liability, fee, or expense arising out of or in connection with a
transaction entered into by or on behalf of any other Portfolio or Fund, or
arising out of or in connection with any other action by a Portfolio or Fund
giving rise to expenses as described in Section 13.3(i), or any judgment with
respect thereto.
(b) With respect to each Fund that is organized as a Massachusetts
business trust, the parties hereby agree that this Agreement is not executed on
behalf of the trustees of such Fund as individuals, and the obligations of such
Fund, or a Portfolio of such Fund (with respect to a Fund with Portfolios),
13
under this Agreement and its Note(s) are not binding on any of the trustees,
officers or shareholders of such Fund individually, but are binding upon only
the assets and property of such Fund or Portfolio, as the case may be.
(c) Nothing in this Section 2.6 shall affect the rights of the
Operations Agent or the Banks against Adviser Persons as provided in Section
1.6. The Funds and the Portfolios shall honor the good faith allocations made
among them pursuant to the Indemnification Agreement.
2.7 Extension of Scheduled Termination Date. Between 60 and 45
days prior to the scheduled Termination Date, the Funds and Portfolios may, by
written notice to the Administrative Agent and Documentation Agent, request that
all Banks extend for an additional 364 days the scheduled Termination Date. The
Administrative Agent and Documentation Agent shall deliver a copy of such notice
to each Bank promptly following its receipt thereof. Such extension so requested
shall become effective on the then-current scheduled Termination Date if (and
only if) on or prior to 30 days after such notice, each Bank shall have
consented to such extension in writing by notice to the Administrative Agent and
Documentation Agent. If a Bank shall not respond to any such request, it shall
be deemed to have refused to extend. The Administrative Agent and Documentation
Agent shall promptly inform the Funds and Portfolios of each Bank's consent to
or rejection of, or failure to consent to, any Termination Date extension
request. If any Bank (a "Non-Extending Bank") shall not agree to such extension,
but Banks holding at least 66-2/3% of the Commitments shall agree to such
extension, the Funds and Portfolios may request one or more of the other Banks
to purchase the Commitment of the Non-Extending Bank or, with the consent of the
Administrative Agent and Documentation Agent, the Funds and Portfolios may
request an Eligible Lender to purchase the Commitment of the Non-Extending Bank
(any such Bank or Eligible Lender purchasing all or a portion of such Commitment
being called a "Replacement Bank"). Any such purchase by a Replacement Bank
shall be subject to the terms of Section 13.8(b), except that the relevant
Fund(s) and/or Portfolio(s) shall pay any cost related to breakage of existing
Interest Periods or the cost of funding existing Loans for the remainder of
existing Interest Periods.
3. INTEREST AND FEES.
3.1 Interest.
(a) Federal Funds Rate Loans. The unpaid principal amount of each
Federal Funds Rate Loan shall bear interest prior to maturity at a rate per
annum equal to the Federal Funds Rate in effect from time to time plus the
Federal Funds Rate Margin. Accrued interest on each Federal Funds Rate Loan
shall be payable on each required date of repayment of principal.
(b) Eurodollar Loans. The unpaid principal amount of each Eurodollar
Loan shall bear interest prior to maturity at a rate per annum equal to LIBOR
(Reserve Adjusted) in effect for each Interest Period with respect to such
Eurodollar Loan plus the Eurodollar Margin. Accrued interest on each Eurodollar
Loan shall be payable on each required date of repayment of principal.
(c) Interest After Maturity. Each Fund and, in the case of a Fund
comprised of Portfolios, each Fund on behalf of its Portfolios shall pay to the
14
Banks interest on any amount of principal of any Loan borrowed on behalf of each
such Fund or Portfolio which is not paid when due, whether at stated maturity,
by acceleration or otherwise, accruing from and including the date such amount
shall have become due to, but not including, the date of payment thereof in full
at the rate per annum which is equal to the greater of (i) 2% in excess of the
rate applicable to the unpaid principal amount immediately before it became due
and (ii) 2% in excess of the Reference Rate in effect from time to time. After
maturity, accrued interest shall be payable on demand.
(d) Maximum Interest Rate. It is the intention of each Bank and each
Fund and Portfolio party hereto that the interest on the Loans that may be
charged to, taken from or received from any Fund or Portfolio, as the case may
be, shall not exceed the maximum rate of interest permissible under applicable
law. Notwithstanding anything to the contrary contained in any Credit Document,
if any interest is charged to, taken from or received from a Fund or Portfolio
by a Bank pursuant to any Credit Document in excess of such maximum lawful rate
of interest, then the excess of such payment over the maximum shall be applied
to the reduction of the outstanding principal balance of the Loans of such Fund
or Portfolio (without prepayment premium or penalty), and any portion of such
excess payment remaining after such application shall be returned by such Bank
to such Fund or Portfolio.
3.2 Commitment Fee. The Funds and Portfolios shall
collectively pay to the Banks a commitment fee equal to 0.09% per annum on the
average daily unused portion of the Commitment Amount from time to time during
the period from and including the date of this Agreement to, but not including,
the earlier of the Termination Date or the date of termination of the Commitment
Amount pursuant to Section 4.3 or 11.2. Such commitment fee shall be payable in
arrears on each Fee Payment Date and a pro-rated installment shall be payable on
the Termination Date or the date of termination of the Commitments for any
period then ending for which such commitment fee shall not have been theretofore
paid. Notwithstanding the foregoing, the amount of the commitment fee shall be
reduced pro rata in accordance with any termination, or reduction from time to
time in the Commitment Amount. Each Fund or Portfolio, as the case may be, shall
be liable only for its portion of the commitment fee, and such Fund or Portfolio
shall not be liable for any portion of the commitment fee of any other Fund or
Portfolio. The Funds shall notify the Operations Agent at least two Banking Days
in advance of a Fee Payment Date of the manner in which the fees to be paid on
such Fee Payment Date are to be allocated among the Funds and Portfolios.
3.3 Method of Calculating Interest and Fees. Interest on each
Loan shall be calculated on the basis of a year consisting of 360 days and paid
for actual days elapsed, calculated as to each Interest Period from and
including the first day thereof to, but not including, the last day thereof. Any
fees shall be calculated on the basis of a year consisting of 360 days and paid
for actual days elapsed.
4. PAYMENTS, PREPAYMENTS, REDUCTION OR TERMINATION OF THE COMMITMENTS
AND SETOFF.
4.1 Place of Payment. All payments hereunder (including
payments with respect to the Notes) shall be made without setoff or counterclaim
and shall be made to the Operations Agent in immediately available funds prior
to 9:30 a.m., Eastern time, on the date due at State Street, ABA No. 011-000028,
15
Account No. MMTA 42525, Reference: Xxxx Xxxxx, or at such other place or for
such other account as may be designated by the Operations Agent to the Funds and
Portfolios in writing. Any payments received after such time shall be deemed
received on the next Banking Day. The Operations Agent will promptly distribute
to each Bank its Pro Rata Share (or other applicable share as expressly provided
herein) of such payment in like funds as received. Subject to the definition of
the term "Interest Period," whenever any payment to be made hereunder or under a
Note shall be stated to be due on a date other than a Banking Day, such payment
may be made on the next succeeding Banking Day, and such extension of time shall
be included in the calculation of interest or any fees.
4.2 Prepayments.
(a) Mandatory Prepayments. If at any time the outstanding principal
balance of a Fund's or Portfolio's, as the case may be, Loans hereunder shall
exceed the then-current Borrowing Base of such Fund or Portfolio, such Fund or
Portfolio shall immediately prepay the outstanding principal amount of such
Loans in an amount equal to such excess, subject to the indemnification
provisions of Section 5.5.
(b) Optional Prepayments. Each Fund or Portfolio, as the case may be,
may from time to time, upon at least two (2) Banking Days' prior written or
telephonic notice received by the Operations Agent, prepay the principal of the
Loans to such Fund or Portfolio in whole or in part, as contemplated by Section
2.1; provided, however, that any partial prepayment of principal shall be in a
minimum amount of $100,000 or in an integral multiple of $100,000 in excess
thereof, and provided further, that any prepayment of principal shall be subject
to the indemnification provisions of Section 5.5, but shall otherwise be without
any premium or penalty. Such Fund or Portfolio shall promptly confirm any
telephonic notice of prepayment in writing.
4.3 Reduction or Termination of the Commitment Amount. The
Funds and Portfolios may from time to time, upon at least 30 calendar days'
prior written or telephonic notice given by or on behalf of the Funds and
Portfolios and received by the Operations Agent, permanently reduce the
Commitment Amount, but only upon payment of the unpaid principal amount of the
Loans, if any, in excess of the then-reduced amount of the Commitment Amount,
plus (i) accrued interest to the date of such payment on the principal amount
being repaid and (ii) any amount required to indemnify the Banks pursuant to
Section 5.5 in respect of such payment. Any such reduction shall be in a minimum
amount of $1,000,000 and in an integral multiple of $500,000 and shall be
applied to each Bank according to its Pro Rata Share. The Funds and Portfolios
may at any time on like notice terminate the Commitments upon payment in full of
(a) the Loans, (b) accrued interest thereon to the date of such payment, (c) any
amount required to indemnify the Banks pursuant to Section 5.5 in respect of
such payment, and (d) any other liabilities of the Funds and Portfolios
hereunder. The Funds and Portfolios shall promptly confirm any telephonic notice
of reduction or termination of the Commitments in writing.
4.4 Setoff. In addition to and not in limitation of all other
rights and remedies (including other rights of setoff) that the Banks may have,
a Bank shall, upon the occurrence of any Event of Default described in Section
11.1 or any Unmatured Event of Default described in Section 11.1(e), have the
right to appropriate and apply to any payment of any and all Loans and other
16
liabilities of a Fund or Portfolio hereunder (whether or not then due), in such
order of application as such Bank may elect, any and all balances, credits,
deposits (general or special, time or demand, provisional or final), accounts or
moneys of such Fund or Portfolio (and not any other Fund or Portfolio) then or
thereafter with such Bank. A Bank shall promptly advise the relevant Fund or
Portfolio and the Operations Agent of any such setoff and application made with
respect to the Fund or Portfolio, but failure to do so shall not affect the
validity of such setoff and application.
4.5 Borrowing Base. The borrowing base (the "Borrowing Base")
of each Fund or Portfolio, as the case may be, as of any date shall be the
amount shown on each Borrowing Base Certificate or Borrowing Certificate, if
applicable, furnished from time to time with respect to such Fund or Portfolio.
4.6 Payments by the Banks to the Operations Agent.
(a) Unless the Operations Agent receives notice from a Bank at least
one Banking Day prior to the date of such Borrowing that such Bank will not make
available as and when required hereunder to the Operations Agent for the account
of the relevant Fund or Portfolio the amount of that Bank's Pro Rata Share of
the Borrowing, the Operations Agent may assume that each Bank has made such
amount available to the Operations Agent in immediately available funds on the
Borrowing date and the Operations Agent may (but shall not be so required), in
reliance upon such assumption, make available to the relevant Fund or Portfolio
on such date a corresponding amount. If and to the extent any Bank shall not
have made its full amount available to the Operations Agent in immediately
available funds and the Operations Agent in such circumstances has made
available to the relevant Fund or Portfolio such amount, that Bank shall on the
Banking Day following such Borrowing date make such amount available to the
Operations Agent, together with interest at the Federal Funds Rate for each day
during such period. A notice of the Operations Agent submitted to any Bank with
respect to amounts owing under this subsection (a) shall be conclusive, absent
manifest error. If such amount is so made available, such payment to the
Operations Agent shall constitute such Bank's Loan on the Borrowing date for all
purposes of this Agreement. If such amount is not made available to the
Operations Agent on the Banking Day following the Borrowing date, the Operations
Agent will notify the relevant Fund or Portfolio of such failure to fund, and
upon demand by the Operations Agent, the relevant Fund or Portfolio shall pay
such amount to the Operations Agent for the Operations Agent's account, together
with interest thereon for each day elapsed since the date of such Borrowing, at
a rate per annum equal to the interest rate applicable at the time to the Loans
comprising such Borrowing.
(b) The failure of any Bank to make any Loan on any Borrowing date
shall not relieve any other Bank of any obligation hereunder to make a Loan on
such Borrowing date, but no Bank shall be responsible for the failure of any
other Bank to make the Loan to be made by such other Bank on any Borrowing date.
4.7 Sharing of Payments. If, other than as expressly provided
elsewhere herein, any Bank shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off or otherwise) in excess of its Pro Rata Share, such Bank shall
immediately (a) notify the Operations Agent of such fact and (b) purchase from
17
the other Banks such participations in the Loans made by them as shall be
necessary to cause such purchasing Bank to share the excess payment pro rata
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from the purchasing Bank, such purchase shall to
that extent be rescinded and each other Bank shall repay to the purchasing Bank
the purchase price paid therefor, together with an amount equal to such paying
Bank's ratable share (according to the proportion of (i) the amount of such
paying Bank's required repayment to the purchasing Bank to (ii) the total amount
so recovered from the purchasing Bank) of any interest or other amount paid or
payable by the purchasing Bank in respect of the total amount so recovered. Each
Fund and Portfolio agrees that any Bank so purchasing a participation from
another Bank may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off with respect to such
participation) as fully as if such Bank were the direct creditor of the relevant
Fund in the amount of such participation. The Operations Agent will keep records
(which shall be conclusive and binding in the absence of manifest error) of
participations purchased under this Section and will in each case notify the
Banks following any such purchases or repayments.
5. ADDITIONAL PROVISIONS RELATING TO LOANS.
5.1 Increased Cost. If, as a result of any law, rule,
regulation, treaty or directive, or any change therein or in the interpretation
or administration thereof, or compliance by a Bank with any request or directive
(whether or not having the force of law) from any court or governmental
authority, agency or instrumentality:
(a) any tax, duty or other charge with respect to any Loan,
any Note, or such Bank's obligation to make Loans is imposed, modified
or deemed applicable, or the basis of taxation of payments to such Bank
of the principal of, or interest on, any Loan (other than taxes imposed
on the overall net income of such Bank by the jurisdiction in which
such Bank has its principal office) is changed;
(b) any reserve, special deposit, special assessment or
similar requirement against assets of, deposits with or for the account
of, or credit extended by, such Bank is imposed, modified or deemed
applicable; or
(c) any other condition affecting this Agreement or any Loan
is imposed on such Bank or the interbank eurodollar market,
and such Bank determines that, by reason thereof, the cost to such Bank of
making or maintaining any Loan is increased, or the amount of any sum receivable
by such Bank hereunder or under the Note in respect of any Loan is reduced,
then each Fund and/or each Portfolio, as the case may be, whose Loan is affected
by the foregoing shall pay to such Bank upon demand such additional amount or
amounts as will compensate such Bank for such additional cost or reduction, not
to exceed an amount or amounts reasonably incurred, upon presentation by such
Bank of a statement in the amount or amounts and setting forth such Bank's
calculation thereof (provided that such Bank has not been compensated for such
additional cost or reduction in the calculation of the Eurocurrency Reserve
18
Requirement). Determinations by a Bank for purposes of this Section 5.1 of the
additional amounts required to compensate such Bank in respect of the foregoing
shall be conclusive in the absence of manifest error. In determining such
amounts, the relevant Bank may use any reasonable averaging, attribution and
allocation methods.
5.2 Deposits Unavailable or Interest Rate Unascertainable or
Inadequate; Impracticability. If any Fund or Portfolio has any Eurodollar Loan
outstanding or a Fund or Portfolio, as the case may be, has notified the
Operations Agent of its intention to borrow a Eurodollar Loan as provided
herein, then in the event that, prior to any Interest Period, a Bank shall have
determined in good faith (which determination shall be conclusive and binding on
the parties hereto) that:
(i) deposits of the necessary amount for the relevant Interest
Period are not available to such Bank in the interbank eurodollar
market or that, by reason of circumstances affecting such market,
adequate and reasonable means do not exist for ascertaining LIBOR
applicable to such Interest Period; or
(ii) LIBOR (Reserve Adjusted) will not adequately and fairly
reflect the cost to such Bank of making or funding the Eurodollar Loans
for such Interest Period; or
(iii) the making or funding of Eurodollar Loans has become
impracticable as a result of any event occurring after the date of this
Agreement which, in the opinion of such Bank, materially and adversely
affects such Loans or such Bank's obligation to make such Loans,
then (x) any notice of a new Eurodollar Loan previously given by or on behalf of
any Fund or Portfolio, as the case may be, and not yet borrowed or converted
shall be deemed to be a notice to make a Federal Funds Rate Loan, and (y)
provided that such Fund or Portfolio has been notified of such determination by
the relevant Bank, such Fund or Portfolio shall be obligated, at its election,
either to prepay in full the outstanding Eurodollar Loans without any premium or
penalty (except as provided in Section 5.5) on the last day of the then-current
Interest Period with respect thereto or to convert any such Loans to Federal
Funds Rate Loans on such last day.
5.3 Changes in Law Rendering Eurodollar Loans Unlawful. If at
any time due to any new law, treaty or regulation, or any interpretation thereof
by any governmental or other regulatory authority charged with the
administration thereof, or for any other reason arising subsequent to the date
hereof, it shall become unlawful for a Bank to fund any Eurodollar Loan,
Eurodollar Loans shall not be made hereunder by such Bank for so long as it
would be unlawful for such Bank to do so. If any such change shall make it
unlawful for a Bank to continue any Eurodollar Loan previously made by it
hereunder, each Fund or Portfolio having Eurodollar Loans outstanding at such
time shall, after being notified by such Bank of the occurrence of such event,
on the earlier of (i) the last day of the then-current Interest Period or (ii)
if required by such law, regulation or interpretation, on such date as shall be
specified in such notice, at such Fund's or Portfolio's option, either convert
each such Eurodollar Loan to a Federal Funds Rate Loan or prepay such Loan to
such Bank in full without any premium or penalty (but subject to Section 5.5).
19
5.4 Discretion of the Bank as to Manner of Funding.
Notwithstanding any provision of this Agreement to the contrary, each Bank shall
be entitled to fund and maintain its funding of all or any part of its
Eurodollar Loans in any manner it sees fit; it being understood, however, that
for purposes of this Agreement, all determinations hereunder shall be made as if
such Bank had actually funded and maintained each Eurodollar Loan during the
Interest Period for such Loan through the purchase of deposits having a term
corresponding to such Interest Period and bearing an interest rate equal to
LIBOR for such Interest Period (whether or not such Bank shall have granted any
participations in such Eurodollar Loan). The Funds and Portfolios acknowledge
that the Banks may fund all or any part of the Loans by sales of participations
to various participants; provided such participants are Eligible Lenders.
5.5 Funding Losses. Each Fund or Portfolio, as the case may
be, will indemnify each Bank upon demand against any loss or expense which such
Bank may sustain or incur (including, without limitation, any loss or expense
sustained or incurred in obtaining, liquidating or employing deposits or other
funds acquired to effect, fund or maintain any Loan, but not including any loss
or expense incurred as a result of such Bank's gross negligence or willful
misconduct) as a consequence of (i) any failure of any such Fund or Portfolio to
make any payment when due of any amount due hereunder, (ii) any failure of any
such Fund or Portfolio to borrow, continue or convert a Loan on a date specified
therefor in a notice thereof or (iii) any payment (including any payment made
pursuant to the Bank's demand for payment of the unpaid principal of the Loans),
prepayment or conversion of any Loan on a date other than the last day of the
Interest Period for such Loan. Other than the indemnification provided above, no
premium or penalty shall be payable in connection with any of the circumstances
described above.
5.6 Capital Adequacy. If a Bank shall reasonably determine
that the application or adoption of any law, rule, regulation, directive,
interpretation, treaty or guideline regarding capital adequacy, or any change
therein or in the interpretation or administration thereof, whether or not
having the force of law (including, without limitation, application of changes
to Regulation H and Regulation Y of the Federal Reserve Board issued by the
Federal Reserve Board and regulations of the Comptroller of the Currency,
Department of the Treasury, 12 CFR Part 3, Appendix A, issued by the Comptroller
of the Currency), increases the amount of capital required or expected to be
maintained by such Bank or any entity controlling such Bank, and such increase
is based upon the existence of such Bank's obligations hereunder and other
commitments of this type, then from time to time the relevant Fund(s) or
Portfolio(s), as the case may be, shall pay to such Bank an amount equal to such
amount or amounts as will compensate such Bank or such controlling entity, as
the case may be, for such increased capital requirement within ten (10) Banking
Days upon presentation of a certificate of such Bank setting forth the amount or
amounts and the Bank's calculation thereof, which certificate shall be
conclusive in the absence of manifest error. The determination of any amount or
amounts to be paid under this Section 5.6 shall be based upon any reasonable
averaging, attribution and allocation methods. In this connection, the relevant
Bank shall allocate such amount or amounts among its customers to which such
Bank has made loans of the type covered hereby in good faith and on an equitable
basis. A certificate of a Bank setting forth the amount or amounts as shall be
necessary to compensate the Bank and a calculation of such amount or amounts as
specified in this Section 5.6 shall be delivered to such Fund or Portfolio and
shall be conclusive in the absence of manifest error.
20
5.7 Additional Provisions with Respect to Federal Funds Rate
Loan. The selection by a Fund or Portfolio of the Federal Funds Rate and the
maintenance of advances at such rate shall be subject to the following
additional terms and conditions:
(a) If, after a Fund or Portfolio has elected to borrow or
maintain any Loan at the Federal Funds Rate, the Operations Agent
notifies such Fund or Portfolio that reasonable means do not exist for
the Operations Agent to determine the Federal Funds Rate, as determined
by the Operations Agent in its sole discretion, then the principal of
the Loan subject to the Federal Funds Rate shall accrue or shall
continue to accrue interest at the Reference Rate.
(b) If any treaty, statute, regulation or interpretation
thereof, or any directive, guideline, or other requirement of a central
bank or fiscal authority (whether or not having the force of law) shall
prohibit the maintenance of any Loan subject to the Federal Funds Rate,
then on and as of the date the prohibition becomes effective, the
principal subject to that prohibition shall accrue or shall continue to
accrue interest at the Reference Rate.
6. WARRANTIES. To induce the Banks and the Agents to enter into this
Agreement, grant the Commitments and to make the Loans, each Fund hereby
warrants with respect to itself and, as may be relevant with respect to a Fund
comprised of Portfolios, the relevant Portfolio that:
6.1 Existence. It is an open-end, management investment
company within the meaning of the Act and is duly organized, validly existing
and in good standing under the laws of the state of its organization. It is in
good standing and is duly qualified to do business in each state where, because
of the nature of its respective activities or properties, such qualification is
required, except where the failure to be so qualified would not have a Material
Adverse Effect. If it is a Fund comprised of Portfolios, the relevant Portfolio
is a series of shares of beneficial interest in, or common stock of, such Fund
(which shares have been and will be duly authorized, validly issued, fully paid
and non-assessable by such Fund) and legally constitutes a fund or portfolio
permitted to be marketed to investors pursuant to the provisions of the Act.
6.2 Authorization. It is duly authorized to execute and
deliver this Agreement and its Notes and is and, so long as this Agreement shall
remain in effect with respect to it, will continue to be duly authorized to
borrow monies hereunder on its own behalf or, if it is a Fund comprised of one
or more Portfolios, on behalf of the relevant Portfolio, and to perform its
obligations under this Agreement and its Notes. The execution, delivery and
performance by it of this Agreement and its Notes and the effecting of its
Borrowings hereunder on its own behalf or, if it is a Fund comprised of
Portfolios, on behalf of the relevant Portfolio, do not and will not require any
consent or approval of, or registration with, any governmental agency or
authority.
6.3 No Conflicts. The execution, delivery and performance by
it of this Agreement and its Notes do not and, so long as this Agreement shall
remain in effect with respect to it, will not (i) conflict with any provision of
law, (ii) conflict with its constituent documents or, as applicable, its Trust
Agreement, (iii) conflict with any agreement binding upon it, (iv) conflict with
either its most recent prospectus or its most recent statement of additional
21
information, (v) conflict with any court or administrative order or decree
applicable to it or (vi) require, or result in, the creation or imposition of
any Lien on any of its assets.
6.4 Validity and Xxxxxxx Effect. This Agreement is, and its
Notes when duly executed and delivered will be, a legal, valid and binding
obligation of such Fund or Portfolio, enforceable against it in accordance with
its terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization, receivership, fraudulent conveyance, fraudulent transfer,
moratorium or other similar laws of general application affecting the
enforcement of creditors' rights or by general principles of equity limiting the
availability of equitable remedies. The claims of the Banks under its Notes for
Borrowings hereunder will rank at least pari passu with the claims of all its
other unsecured creditors, except those whose claims are preferred solely by any
bankruptcy, insolvency, liquidation or other similar laws of general
application.
6.5 No Default. It is not in default under any agreement or
instrument to which it is a party or by which any of its respective properties
or assets is bound or affected, which default might have a Material Adverse
Effect. To the best of the Fund's knowledge, no Event of Default or Unmatured
Event of Default with respect to it or, if it is comprised of Portfolios, the
relevant Portfolio, has occurred and is continuing.
6.6 Financial Statements. Its most recent audited Statement of
Assets and Liabilities and its most recent semi-annual asset statement, copies
of which have been or will be furnished to the Operations Agent and the Banks,
have been prepared in conformity with GAAP applied on a basis consistent with
that of the preceding Fiscal Year or period and present fairly its financial
condition as at such dates and the results of its operations for the periods
then ended, subject (in the case of the interim financial statement) to year-end
audit adjustments. Since the date of its most recent Statement of Assets and
Liabilities and such semi-annual asset statement, there has been no material
adverse change in such financial condition or, if it is comprised of Portfolios,
the relevant Portfolio, except for fluctuations in value of its assets or the
assets of such Portfolio due to market conditions and shareholder purchases and
redemptions.
6.7 Litigation. No claims, litigation, arbitration proceedings
or governmental proceedings are pending or, to the best of its knowledge,
threatened against or are affecting it or, if it is comprised of Portfolios, the
relevant Portfolio, the results of which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect, except those referred
to in a schedule furnished to the Administrative Agent and Documentation Agent
and the Banks contemporaneously herewith and attached hereto as Exhibit D. Other
than any liability incident to such claims, litigation or proceedings or
provided for or disclosed in the financial statements referred to in Section 6.6
or listed on Exhibit E, neither such Fund nor the relevant Portfolio, in the
case of a Fund comprised of Portfolios, to the best of its knowledge, has any
contingent liabilities which are material to it other than those incurred in the
ordinary course of business.
6.8 Liens. None of the property, revenues or assets of such
Fund or any of the relevant Portfolio, in the case of a Fund comprised of
Portfolios, is subject to any Lien, except (i) Liens in favor of the Agents, if
any, (ii) Liens for current Taxes not delinquent or Taxes being contested in
good faith and by appropriate proceedings and as to which such reserves or other
appropriate provisions as may be required by GAAP are being maintained, (iii)
Liens as are necessary in connection with a secured letter of credit opened by
22
such Fund or Portfolio in connection with the Fund's or the Portfolio's
trustees/directors' and officers' errors and omissions liability insurance
policy, (iv) Liens in connection with advances of cash or securities made, or in
connection with any taxes, charges, expenses, assessments, claims or liabilities
incurred, by a Fund's or Portfolio's custodian and (v) Liens in connection with
the payment of initial and variation margin in connection with authorized
futures and options transactions and collateral arrangements with respect to
options, futures contracts, options on futures contracts, short sales,
when-issued or delayed delivery securities or other authorized investments or
portfolio management techniques.
6.9 Partnerships. Such Fund or Portfolio is not a partner or
joint venturer in any partnership or joint venture other than (i) in connection
with its investments as a limited partner in limited partnership investments and
(ii) in connection with its insurance arrangements.
6.10 Purpose. The proceeds of the Loans will be used by such
Fund or, if it is comprised of Portfolios, by the relevant Portfolio, as may be
designated in the relevant Borrowing Certificate, for temporary purposes, which
purposes are permitted by such Fund's or Portfolio's prospectus and statement of
additional information and the Act. Neither the making of any Loan nor the use
of the proceeds thereof will violate or be inconsistent with the provisions of
Federal Reserve Board Regulation T, U or X. Each such Fund acknowledges that
Loans made to it or to it on behalf of its Portfolios, as the case may be, may
be deemed by the Federal Reserve Board to be "purpose loans" under Regulation U
because of such Fund's status as an investment company (or the functional
equivalent thereof).
6.11 Compliance. Such Fund or Portfolio is in compliance with
all statutes and governmental rules and regulations, consents, orders and
decrees applicable to it, including, without limitation, the Act, other than any
statutes, governmental rules and regulations, consents and decrees the
non-compliance with which will not have a Material Adverse Effect on such Fund's
or Portfolio's operations, assets or financial condition.
6.12 Pension and Welfare Plans. Such Fund or Portfolio has not
established or maintained, nor is it liable under or in respect of, any Plan.
6.13 Taxes. Such Fund or Portfolio has filed all tax returns
that are required to have been filed and has paid, or made adequate provisions
for the payment of, all of its Taxes that are due and payable, except such
Taxes, if any, as are being contested in good faith and by appropriate
proceedings and as to which such reserves or other appropriate provisions as may
be required by GAAP have been maintained. Such Fund or Portfolio is not aware of
any proposed assessment against it for additional Taxes (or any basis for any
such assessment) which might be material in amount to it. Such Fund or Portfolio
has complied with all requirements of the Code applicable to regulated
investment companies so as to be relieved of federal income tax on net
investment income and net capital gains distributed to shareholders of the Fund
or Portfolio.
6.14 Subsidiaries; Investments. Such Fund or Portfolio has no
Subsidiaries and no equity investment or interest in any other Person other than
portfolio securities which may have been acquired in the ordinary course of
business.
23
6.15 Full Disclosure. No representation or warranty contained
in this Agreement or in any other document or instrument furnished to any Agent
and the Banks in connection herewith contains any untrue statement of any
material fact as of the date when made or omits to state any material fact
necessary to make the statements herein or therein not misleading as of the date
when made.
6.16 Investment Policies. The assets of such Fund or Portfolio
are being invested in accordance with the investment policies and restrictions
set forth in each of its most recent prospectuses and its most recent statement
of additional information, except for incidents of inadvertent non-compliance
therewith which will not, individually or in the aggregate, have a Material
Adverse Effect on the Fund's or Portfolio's business or financial condition.
7. COVENANTS. From the date of this Agreement and thereafter until the
expiration or termination of the Commitments and until its Note or Notes and
other liabilities are paid in full, each Fund agrees with respect to itself and,
if it is comprised of Portfolios, the relevant Portfolio, that, unless the
Majority Banks shall otherwise expressly consent in writing, to:
7.1 Financial Statements and Other Reports. Subject to the
last sentence of this Section 7.1, furnish to the Agents and each Bank:
(a) Audit Reports. As soon as available and in any event
within 60 days after each of its Fiscal Years, a copy of its annual
audited Statement of Assets and Liabilities, including a statement of
investments, prepared in conformity with GAAP and certified by an
independent certified public accountant who shall be satisfactory to
the Majority Banks, together with a certificate from such accountant
(i) acknowledging to the Agents such accountant's understanding that
the Agents and the Banks are relying on such Statement of Assets and
Liabilities, (ii) containing a computation of, and showing compliance
with, the financial ratio contained in Section 7.13 and (iii) to the
effect that, in making the examination necessary for the signing of
such Statement of Assets and Liabilities, such accountant has not
become aware of any Event of Default or Unmatured Event of Default that
has occurred and is continuing, or if such accountant has become aware
of any such event, describing it and the steps, if any, being taken to
cure it;
(b) Semi-Annual Asset Statements. Within 60 days after the end
of the first six months of its Fiscal Year, a copy of its published
semi-annual asset statement, prepared in conformity with GAAP;
(c) Borrowing Base Certificate. In addition to each Borrowing
Certificate provided pursuant to Section 2.3, not later than 7 days
after the end of each calendar quarter, or at any other time reasonably
requested by the Operations Agent, a certificate of a designated
officer of its Adviser, acting on its behalf, in the form set forth as
Exhibit F hereto (a "Borrowing Base Certificate"), certifying, as of
the end of such quarter, as to the current Borrowing Base of it or, if
it is comprised of Portfolios, such Portfolio to the extent Loans were
24
made during such quarter or are outstanding at the end of such quarter,
and showing all calculations used in determining such amounts;
(d) Officer's Certificate. Within 15 days after the end of
each calendar quarter during which a Loan was outstanding at the end of
such quarter, a certificate of a designated officer of the borrowing
Fund's or Portfolio's Adviser, acting on such Fund's or Portfolio's
behalf, certifying to the effect that, to the best of such Adviser's
knowledge, no Event of Default or Unmatured Event of Default has
occurred and is continuing and containing a computation of, and showing
compliance with, the financial ratio contained in Section 7.13;
(e) Securities and Exchange Commission and Other Reports.
Copies of each filing and report made by it with or to any securities
exchange or the Securities and Exchange Commission (other than any
filing or report not sent to investors) and of each communication
(other than marketing and other non-financial communications sent in
the ordinary course of business) from it to investors generally,
promptly upon the filing or making thereof; and
(f) Requested Information. Promptly from time to time such
other reports or information as any Agent or Bank may reasonably
request, including, without limitation, those required pursuant to
Section 8.5.
Notwithstanding the foregoing, such Fund or Portfolio may fulfill its
obligations to the Administrative Agent and Documentation Agent, the Operations
Agent and the Banks under paragraphs (a), (b) and (e) of this Section 7.1 by
providing to the Administrative Agent and Documentation Agent (with copies
sufficient for the Operations Agent and each Bank) (without duplication) each
report, statement, mailing and distribution (other than transaction
confirmations and dividend statements) sent to shareholders of such Fund or
Portfolio, including all statements of additional information, for which the
Administrative Agent and Documentation Agent, the Operations Agent and the Banks
shall be deemed to have made specific requests.
7.2 Notices. Notify the Agents in writing of any of the
following immediately upon learning of the occurrence thereof, describing the
same and, if applicable, stating the steps being taken by the Person(s) affected
with respect thereto:
(a) Default. The occurrence of an Event of Default or an
Unmatured Event of Default;
(b) Litigation. The institution of any litigation, arbitration
proceeding or governmental proceeding which, if adversely determined,
could reasonably be expected to have a Material Adverse Effect;
(c) Judgment. The entry of any judgment or decree against such
Fund or Portfolio if the aggregate amount of all judgments and decrees
then outstanding against such Fund or Portfolio exceeds $1,000,000 or,
if less, 1% of the Fund's or Portfolio's assets, after deducting (i)
the amount with respect to which such Fund or Portfolio is insured and
with respect to which the insurer has assumed responsibility in
writing, and (ii) the amount for which such Fund or Portfolio is
25
otherwise indemnified if the terms of such indemnification and the
Person providing such indemnification are satisfactory to the Majority
Banks;
(d) Pricing Service Information. The occurrence of any change
in the pricing services utilized by such Fund or Portfolio as referred
to in the definition of "Total Assets";
(e) Name Changes. The occurrence of a change of name (whether
of its legal name or a "d/b/a" designation) of such Fund or, if it is
comprised of Portfolios, of the relevant Portfolio. The Fund or, if it
is a Fund comprised of Portfolios, the Fund, on behalf of the affected
Portfolio(s), shall promptly execute and deliver to each Bank a new
Note executed in its new name, together with such other documents in
connection therewith as the Bank shall reasonably request;
(f) Other Changes. Upon becoming aware of any potential change
of such Fund's or Portfolio's Adviser or distributor or the appointment
of any sub-adviser or any Person acting in a similar capacity to an
Adviser (and in any event not later than 30 days prior to the time as
the board of trustees or directors of such Fund is to consider approval
of such change or appointment or otherwise determines to recommend such
change or appointment (if necessary) to its shareholders for their
approval) and, not later than 30 days prior to the occurrence of any
change of such Fund's or Portfolio's custodian, independent accountant,
sponsor or administrator, notice thereof; provided that a mailing to
shareholders with respect to any of the foregoing shall not be deemed
to be sufficient notice hereunder; and provided further, that if, in
the good faith judgment of the Majority Banks such proposed change will
result or has resulted in a change in the Majority Banks' analysis of
the creditworthiness of such Fund or Portfolio or, in the case of any
such proposed change of such Fund's or Portfolio's Adviser or if a new
Adviser, any sub-adviser or any other Person acting in a similar
capacity to an Adviser is appointed, such Adviser, new Adviser,
sub-adviser or other Person fails to provide the Banks with a letter in
the form of Exhibit H, then the Banks may terminate their Commitments
to lend to such Fund or Portfolio hereunder upon giving 30 days' notice
to such Fund or Portfolio, and at the end of such 30-day period, all
Loans outstanding to such Fund or Portfolio shall become immediately
due and payable; provided that the provisions of this Section 7.2(f)
shall not apply to a change of a Fund's or Portfolio's investment
adviser in which such investment adviser is replaced by an Adviser or
an Affiliate of an Adviser; and
(g) Other Events. The occurrence of such other events as an
Agent may from time to time reasonably specify.
7.3 Existence. Except as specified in Section 7.12(a),
maintain and preserve its existence as a registered investment company and, if
it is comprised of Portfolios, the existence of the relevant Portfolio as a
"series" within the meaning of the Act, and maintain and preserve all rights,
privileges, licenses, copyrights, trademarks, trade names, franchises and other
authority to the extent material and necessary for the conduct of its business
26
in the ordinary course as conducted from time to time, unless such Fund or
Portfolio has no Loans outstanding and has irrevocably notified the Agents that
it shall not request any Loans hereunder.
7.4 Nature of Business. (a) Continue in, and limit its
operations to, the business of an open-end, management investment company,
within the meaning of the Act, and (b) maintain in full force and effect at all
times all governmental licenses, registrations, permits and approvals necessary
for the continued conduct of its business, including, without limitation, its
registration with the Securities and Exchange Commission under the Act as an
open-end investment company, unless in the case of this clause (b) only the
failure to do so would not have a Material Adverse Effect.
7.5 Books, Records and Access. Maintain complete and accurate
books and records in which full and correct entries in conformity with GAAP
shall be made of all dealings and transactions in relation to such Fund's or
Portfolio's business and activities; upon reasonable notice, permit access by
the Agents and the Banks to its books and records during normal business hours
and permit the Agents or a Bank, as the case may be, to make copies of such
books and records; provided, however, that neither the Agents nor the Banks
shall have access to the shareholder lists of the Fund and, as the case may be,
its Portfolios.
7.6 Insurance. Maintain in full force and effect insurance to
such extent and against such liabilities as is commonly maintained by companies
similarly situated, including, but not limited to (i) such fidelity bond
coverage as shall be required by Rule 17g-1 promulgated under the Act or any
similar or successor provision and (ii) errors and omissions, director and
officer liability, and other insurance against such risks and in such amounts
(and with such co-insurance and deductibles) as is usually carried by other
companies of established reputation engaged in the same or similar businesses
and similarly situated.
7.7 Dividends. Not declare or pay any dividends, except for
(i) dividends not in excess of such Fund's or Portfolio's undistributed net
investment income, net short-term capital gains and net gains from foreign
currency transactions; (ii) annual dividends not in excess of such Fund's or
Portfolio's net capital gains for each year in respect of which such annual
dividend is declared or paid; and (iii) any other dividends necessary to reduce
or eliminate any liability of the Fund or the Portfolio for federal, state,
local or foreign income or excise taxes; provided, however, that dividends
declared in good faith, but later recharacterized as a return of capital due to
foreign currency transactions or other unforeseeable events, shall not be deemed
in violation of this section.
7.8 Investment Policies and Restrictions.
(a) Without prior written notice to the Administrative Agent and
Documentation Agent of at least 30 days (which notice the Administrative Agent
and Documentation Agent shall communicate to the Banks promptly following the
receipt thereof), not rescind, amend or modify any investment policy described
as "fundamental" in any prospectus or any registration statement(s) that may be
on file with the Securities and Exchange Commission with respect thereto
(collectively herein, a "proposed change"). If, in the judgment of the Majority
Banks, such proposed change will result in a change in such Banks' analysis of
the creditworthiness of such Fund or Portfolio, and if such proposed change is
implemented with respect to such Fund or Portfolio, the Commitments to such Fund
27
or Portfolio shall, as of the time such fundamental change is implemented,
terminate, and all Loans outstanding from the Banks to such Fund or Portfolio,
as well as all other amounts owing to the Banks from such Fund or Portfolio,
shall thereupon become immediately due and payable.
(b) Except in the case of a "fundamental" investment policy (which, as
contemplated by subparagraph (a) above, requires prior notice), notify the
Administrative Agent and Documentation Agent within 30 days after rescinding,
amending or modifying any of the investment restrictions as set forth in Exhibit
G hereto with respect to it or, if it is comprised of Portfolios, of the
relevant Portfolio. The signatories hereto acknowledge that Xxxx Xxxxx
Opportunity Trust will be amending its non-fundamental investment policy that
allows it to purchase additional securities as long as borrowings do not exceed
5% of its total assets. The new non-fundamental policy will allow this Portfolio
to borrow for investment purposes an amount not in excess of 10% of its net
assets measured as of the time the borrowing. Additionally, this Portfolio may
borrow for temporary purposes. The signatories hereto further acknowledge that
no further notice need be given with regard to this amendment to Xxxx Xxxxx
Opportunity Trust's non-fundamental investment policy.
(c) Any notice to the Administrative Agent and Documentation Agent
pursuant to this Section 7.8 shall be given in writing pursuant to the
procedures described in the last sentence of Section 7.1.
7.9 Taxes. Pay when due all of its Taxes, unless and only to
the extent that such Taxes are being contested in good faith and by appropriate
proceedings and such Fund or Portfolio shall have set aside on its books such
reserves or other appropriate provisions therefor as may be required by GAAP.
Such Fund or Portfolio shall at all times comply with all requirements of the
Code applicable to regulated investment companies, to such effect as not to be
subject to federal income taxes on net investment income and net capital gains
distributed to its shareholders.
7.10 Compliance. Comply with all statutes and governmental
rules and regulations applicable to it, including, without limitation, the Act,
except were non-compliance with any such statute, rule or regulation could not
be reasonably expected to have a Material Adverse Effect.
7.11 Pension Plans. Not enter into, or incur any liability
relating to, any Plan.
7.12 Merger, Purchase and Sale. Not:
(a) be a party to any merger or consolidation; provided, however, that
any Fund or Portfolio can merge or consolidate with any other Person in
accordance with 17 C.F.R. ss. 270.17a-8 if (i) such merger or consolidation
complies in all respects with the requirements of 17 C.F.R. ss. 270.17a-8 and
all rules promulgated in connection therewith, (ii) the surviving entity assumes
all of the obligations to the Agents and the Banks of the merging or
consolidating Funds and/or Portfolios prior to such merger or consolidation and
(iii) in the judgment of all the Banks the financial condition and investment
policies and restrictions of the surviving entity are not fundamentally
different from those of the merging or consolidating Funds and/or Portfolios
prior to such merger or consolidation;
28
(b) except as permitted by Section 7.12(a) and except for sales or
other dispositions of portfolio assets in the ordinary course of its business,
sell, transfer, convey, lease or otherwise dispose of all or any substantial
part of its assets; or
(c) except as permitted by Section 7.12(a), purchase or otherwise
acquire all or substantially all the assets of any Person without the review and
consent thereto of the Banks, which consent shall not be unreasonably withheld.
For purposes of this Section 7.12 only, (i) a sale, transfer,
conveyance, lease or other disposition of assets shall be deemed to be a
"substantial part" of the assets of any Fund or Portfolio only if the value of
such assets, when added to the value of all other assets sold, transferred,
conveyed, leased or otherwise disposed of by such Fund or Portfolio (other than
in the normal course of business and a redemption in kind made pursuant to
policies set forth in the Fund's registration statement) during the same Fiscal
Year, exceeds 15% of such Fund's or Portfolio's Total Assets determined as of
the end of the immediately preceding Fiscal Year and (ii) a redemption in kind
of securities made pursuant to policies set forth in the Fund's registration
statement shall not be deemed to be a transaction covered by this Section 7.12.
7.13 Asset Coverage Ratio. Not at any time permit its Asset
Coverage Ratio or, if it is comprised of Portfolios, the Asset Coverage Ratio of
the relevant Portfolio, to be less than 4 to 1 or such other more restrictive
ratio as may be set forth in any prospectus or statement of additional
information with respect to such Fund or Portfolio.
7.14 Liens. Not create or permit to exist any Lien with
respect to any property, revenues or assets now owned or hereafter acquired,
except (i) Liens in favor of the Agents and the Banks, if any, (ii) Liens for
current Taxes not delinquent or Taxes being contested in good faith and by
appropriate proceedings and as to which such reserves or other appropriate
provisions as may be required by GAAP are being maintained, (iii) Liens as are
necessary in connection with a secured letter of credit opened by such Fund or
Portfolio in connection with the Fund's or the Portfolio's trustees/directors'
and officers' errors and omissions liability insurance policy, (iv) Liens in
connection with advances of cash or securities made, or in connection with any
taxes, charges, expenses, assessments, claims or liabilities incurred, by a
Fund's or Portfolio's custodian and (v) Liens in connection with the payment of
initial and variation margin in connection with authorized futures and options
transactions and collateral arrangements with respect to options, futures
contracts, options on futures contracts, when-issued or delayed delivery
securities, short sales or other authorized investments or portfolio management
techniques.
7.15 Guaranties. Not become or be a guarantor or surety of, or
otherwise become or be responsible in any manner (whether by agreement to
purchase any obligations, stock, assets, goods or services, or to supply or
advance any funds, assets, goods or services, or otherwise) with respect to, any
undertaking of any other Person, except for the endorsement, in the ordinary
course of collection, of instruments payable to it or its order.
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7.16 Other Agreements. Not enter into any agreement containing
any provision that would be violated or breached by such Fund's or Portfolio's
performance of its obligations hereunder or under any instrument or document
delivered or to be delivered by such Fund or Portfolio hereunder or in
connection herewith.
7.17 Transactions with Related Parties. Not enter into or be a
party to any transaction or arrangement, including, without limitation, the
purchase, sale, lease or exchange of property or the rendering of any service,
with any Related Party, except in the ordinary course of and pursuant to the
reasonable requirements of such Fund's or Portfolio's business and upon fair and
reasonable terms no less favorable to such Fund or Portfolio than would be
obtainable in a comparable arm's-length transaction with a Person not a Related
Party; provided, however, that a transaction or arrangement that does not
violate the Act and the regulations of the Securities and Exchange Commission
thereunder shall be deemed to be in compliance with this Section 7.17.
7.18 Payment of Management Fees. At any time that (x) an Event
of Default or an Unmatured Event of Default shall have occurred and be
continuing with respect to such Fund or Portfolio and (y) Loans are outstanding
with respect to such Fund or Portfolio, not pay, or cause to be paid, any
management or advisory fees of any type in respect of such Fund or Portfolio to
its Adviser, whether pursuant to the terms of an investment advisory agreement
or not; provided, however, that notwithstanding the foregoing, such Fund or
Portfolio shall not be prohibited to record on its financial statement accruals
with respect to such management or advisory fees.
7.19 Other Indebtedness. Not incur or permit to exist any
Indebtedness, other than (i) the Loans, (ii) Indebtedness payable to a Fund's or
Portfolio's transfer agent in connection with overdrafts, (iii) reverse
repurchase transactions in an amount not exceeding that permitted by the Fund's
or Portfolio's investment restrictions and (iv) advances of cash or securities
made, or in connection with any taxes, charges, expenses, assessments, claims or
liabilities incurred, by a Fund's or Portfolio's custodian. Notwithstanding the
foregoing, Xxxx Xxxxx Opportunity Trust shall be permitted to enter into a
separate credit arrangement pursuant to which advances thereunder will be
utilized for investment purposes.
7.20 Changes to Trust Agreement, etc. Not make or permit to be
made any material changes to its Trust Agreement or constituent documents, as
the case may be, without the prior written consent of the Majority Banks.
7.21 Violation of Investment Restrictions, etc. Not violate or
take any action which would result in a violation of any of the investment
restrictions or fundamental investment policies of such Fund or the relevant
Portfolio of such Fund as from time to time in effect, except for such
inadvertent violations as would not, individually or in the aggregate, have a
Material Adverse Effect upon the financial condition or business of such Fund or
Portfolio.
7.22 Proceeds of Loans. Utilize the proceeds of the Loans for
temporary purposes, as permitted by such Fund's or Portfolio's prospectus and
statement of additional information and the Act.
8. CONDITIONS PRECEDENT TO ALL LOANS. The obligation of the Banks to
make any Loan to a Fund or, in the case of a Fund comprised of Portfolios, a
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Portfolio, or, in the case of Section 2.4, to continue or convert any Eurodollar
Loan to any Fund or Portfolio into a subsequent Interest Period, is subject to
the satisfaction of each of the following conditions precedent:
8.1 Notice. The Operations Agent shall have received timely
notice of such Loan in accordance with Section 2.3 or 2.4, as applicable.
8.2 Default. Before and after giving effect to such Loan, no
Event of Default or Unmatured Event of Default shall have occurred and be
continuing with respect to such Fund or Portfolio.
8.3 Warranties. Before and after giving effect to such Loan,
the warranties in Section 6 (other than the warranty in Section 6.7 and the
warranty contained in the last sentence of Section 6.6) with respect to such
Fund or Portfolio, as the case may be, shall be true and correct as though made
on the date of such Loan, except for such changes as are specifically permitted
hereunder.
8.4 Certification. Each request for a Loan shall be deemed to
be a certification that the conditions precedent set out in Sections 8.2 and 8.3
have been satisfied.
8.5 Borrowing Certificate. The Operations Agent shall have
received a Borrowing request from such Fund or, in the case of a Fund comprised
of Portfolios, the relevant Portfolio as contemplated by Section 2.3.
8.6 Minimum Net Asset Value. The Net Asset Value of such Fund
or Portfolio at the time of a Borrowing request shall be at least $10,000,000.
9. CONDITIONS PRECEDENT TO AND CONSEQUENCES OF EFFECTIVENESS OF
AMENDMENTS. The amendment, restatement and replacement effected by this
Agreement shall become effective on the date (the "Refinancing Date") on which
the conditions precedent specified in this Section 9 shall have been satisfied
or waived by the Administrative Agent and Documentation Agent and all the Banks
that are signatories to this document. The occurrence of the Refinancing shall
be subject to (i) the receipt by the Administrative Agent and Documentation
Agent of duly executed counterparts of this amended and restated Agreement
signed by all the parties hereto (or evidence satisfactory to the Administrative
Agent and Documentation Agent that all the parties hereto have executed
counterparts of this Agreement and dispatched them to the Administrative Agent
and Documentation Agent) and (ii) the delivery by the Funds to the
Administrative Agent and Documentation Agent of all of the following, each duly
executed and dated on or within 10 Banking Days before the date hereof:
9.1 Notes. Notes in favor of the Banks from each Continuing
Borrower Party in the amount of each such Bank's Commitment, the Continuing
Borrower Parties, Fleet, State Street, National Australia Bank Limited, Danske
Bank A/S and Bank of America, N.A. agreeing that, upon receipt by the
Administrative Agent and Documentation Agent of such new Notes, the
corresponding Notes of the Continuing Borrower Parties previously delivered to
such Banks shall cease to be of further force and effect. Additionally, each of
Fleet, State Street, National Australia Bank Limited, Danske Bank A/S and Bank
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of America, N.A. acknowledges that the Notes previously issued in favor of such
Bank by the Non-Continuing Borrower Parties shall cease to be of further force
or effect.
9.2 Officer's Certificate. A certificate of the secretary or
an assistant secretary of such Fund or Portfolio setting forth (i) the
resolutions of such Fund's or Portfolio's trustees or directors authorizing or
ratifying the execution and delivery of this Agreement and such Fund's Notes or,
in the case of a Fund comprised of one or more Portfolios, the Notes of each
such Portfolio, and authorizing the Borrowings hereunder, (ii) all documents
evidencing other necessary trust or corporate action, as the case may be, (iii)
all approvals or consents, if any, with respect to this Agreement and the
aforesaid Note(s), (iv) any amendment to the Trust Agreement or other
organizational document for such Fund made since March 15, 2001 and (v) a good
standing certificate with respect to such Fund issued by the Secretary of State
or other relevant authority of the jurisdiction of such Fund's organization.
9.3 Incumbency Certificate. A certificate of the secretary or
an assistant secretary of such Fund certifying the names of the Fund's officers
and/or other persons authorized to sign this Agreement, the Notes of such Fund
or, as appropriate, such Fund's Portfolio(s), and all other documents or
certificates to be delivered hereunder, together with the true signatures of
such officers.
9.4 Opinions. An opinion of counsel to such Fund or Portfolio,
addressed to the Agents and the Banks, substantially in the form of Exhibit I-1
and an opinion of counsel to the Administrative Agent and Documentation Agent
addressed to the Agents and the Banks, substantially in the form of Exhibit I-2.
9.5 Net Asset Value Certificate. A certificate of the net
asset value of such Fund and, if the Fund is comprised of Portfolios, the
Portfolio on whose behalf the Loan is being made.
9.6 Consent of Investment Adviser. A letter from the Fund's or
Portfolio's Adviser addressed to the Banks in care of the Administrative Agent
and Documentation Agent, substantially in the form of Exhibit H.
9.7 Form U-1. Its Form U-1 duly completed and executed as
contemplated by Regulation U of the Federal Reserve Board.
9.8 Consequences of Effectiveness. On the Refinancing Date the
Existing Agreement shall be automatically amended and restated to read as set
forth herein. On and after the Refinancing Date the rights and obligations of
the parties hereto shall be governed by this Agreement; provided that rights and
obligations of the parties hereto with respect to the period prior to the
Refinancing Date shall continue to be governed by the provisions of the Existing
Agreement. On the Refinancing Date, the Pro Rata Shares of each of the Banks
shall immediately become the percentages set forth opposite the name of such
Bank on Schedule I hereto. With effect from and including the Refinancing Date,
each Person listed on the signature pages hereof that is not a party to the
Existing Agreement shall become a party to this Agreement. As of March 15, 2002,
Commerzbank AG, New York Branch, shall cease to be a Bank hereunder.
32
10. ADDITION OF NEW PARTIES.
10.1 New Parties. Subject to the prior consent of each of the
Banks, which may be granted or withheld in its sole discretion, one or more
Funds or Portfolios may become parties hereunder by delivering to the
Administrative Agent and Documentation Agent a notice in the form of Exhibit C
and such other documentation and financial information with respect to such Fund
or Portfolio as the Banks may request, including such items listed in Section 9
as may be relevant in the circumstances.
11. EVENTS OF DEFAULT AND REMEDIES.
11.1 Events of Default. Each of the following shall constitute
an Event of Default with respect to a Fund or Portfolio, as the case may be,
under this Agreement (it being understood that an Event of Default with respect
to a Fund or Portfolio, as the case may be, shall not constitute an Event of
Default with respect to any other Fund or other Portfolio of that Fund):
(a) Non-Payment. Default in the payment when due of any
principal of, or interest on, any Loan made to such Fund or Portfolio,
as the case may be, or any fee hereunder payable by such Fund or
Portfolio, as the case may be.
(b) Non-Payment of Other Indebtedness. Default in the payment
when due, whether by acceleration or otherwise (subject to any
applicable grace period), of any Indebtedness of, or guaranteed by,
such Fund or Portfolio, as the case may be, in excess of 5% of such
Fund's or Portfolio's, as the case may be, then respective total Net
Asset Value.
(c) Acceleration of Other Indebtedness. Any event or condition
shall occur that results in the acceleration of the maturity of any
Indebtedness of, or guaranteed by, such Fund or Portfolio, as the case
may be, or enables the holder or holders of such other Indebtedness or
any trustee or agent for such holders (any required notice of default
having been given and any applicable grace period having expired) to
accelerate the maturity of such other Indebtedness in excess of 5% of
such Fund's or Portfolio's, as the case may be, then respective total
Net Asset Value.
(d) Other Obligations. Default in the payment when due,
whether by acceleration or otherwise, or in the performance or
observance (subject to applicable grace periods, if any) of (i) any
material obligation under any material agreement of such Fund or
Portfolio, as the case may be, to or with an Agent or any Bank (other
than any obligation or agreement of such Fund or Portfolio hereunder or
under such Fund's or Portfolio's Note), or (ii) any material obligation
under any material agreement (other than Indebtedness) of such Fund or
Portfolio, as the case may be, to or with any other Person, except only
to the extent that the existence of any such default is being contested
by such Fund or Portfolio, as the case may be, in good faith and by
appropriate proceedings and such Fund or Portfolio, as the case may be,
shall have set aside on its books such reserves or other appropriate
provisions therefor as may be required by GAAP.
33
(e) Insolvency. The Fund or Portfolio, as the case may be,
becomes insolvent, or generally fails to pay, or admits in writing its
inability to pay, its debts as they mature, or applies for, consents to
or acquiesces in, the appointment of a trustee, receiver or other
custodian for such Fund or Portfolio, as the case may be, or for a
substantial part of its property, or makes a general assignment for the
benefit of creditors; or, in the absence of such application, consent
or acquiescence, a trustee, receiver or other custodian is appointed
for such Fund or Portfolio, as the case may be, or for a substantial
part of the property of such Fund or Portfolio, as the case may be, and
is not discharged within 30 days; or any bankruptcy, reorganization,
debt arrangement or other proceeding under any bankruptcy or insolvency
law, or any dissolution or liquidation proceeding, is instituted by or
against such Fund or Portfolio, as the case may be, and, if instituted
against such Fund or Portfolio, as the case may be, is consented to or
acquiesced in by such Fund or Portfolio, as the case may be, or remains
for 30 days undismissed; or any warrant of attachment or similar legal
process is issued against any substantial part of the property of such
Fund or Portfolio, as the case may be, which is not released within 30
days of service.
(f) Agreements. Such Fund or Portfolio, as the case may be,
shall (i) default in the performance of its agreement under Section
7.13 or (ii) default in the performance of its other agreements herein
set forth (and not constituting an Event of Default under any of the
other subsections of this Section 11.1), and such default shall
continue for 30 days (or 3 days in the case of such Fund's or
Portfolio's, as the case may be, agreement contained in the last
sentence of the definition of "Total Assets") after notice thereof to
such Fund or Portfolio, as the case may be, from an Agent or a Bank.
(g) Warranty. Any warranty made by such Fund or Portfolio, as
the case may be, herein, or in any schedule, statement, report, notice,
certificate or other writing furnished by such Fund or Portfolio, as
the case may be, on or as of the date as of which the facts set forth
therein are stated or certified, is untrue or misleading in any
material respect when made or deemed made; or any certification made or
deemed made by such Fund or Portfolio, as the case may be, to the
Agents and the Banks is untrue or misleading in any material respect on
or as of the date made or deemed made.
(h) Litigation. There shall be entered against such Fund or
Portfolio, as the case may be, one or more judgments or decrees in
excess of $1,000,000.00 in the aggregate at any one time outstanding,
excluding those judgments or decrees (i) that shall have been stayed or
discharged less than 30 calendar days from the entry thereof and (ii)
those judgments and decrees for and to the extent which such Fund or
Portfolio, as the case may be, is insured and with respect to which the
insurer has assumed responsibility in writing or for and to the extent
which such Fund or Portfolio, as the case may be, is otherwise
indemnified if the terms of such indemnification and the Person
providing such indemnification are satisfactory to the Majority Banks.
34
(i) Material Adverse Change. The Majority Banks shall have
determined in good faith that a Material Adverse Change has occurred
with respect to such Fund or Portfolio.
(j) Investment Company Act. Such Fund or Portfolio, as the
case may be, shall no longer be in compliance with the Act after giving
effect to all notice and cure periods thereunder where such
non-compliance or lack of good standing would have a Material Adverse
Effect upon the financial condition or business of such Fund or
Portfolio, as the case may be.
(k) Investment Adviser; Custodian. Such Fund's or Portfolio's,
as the case may be, Adviser shall cease to be an investment adviser of
such Fund or Portfolio, or State Street Bank and Trust Company shall
cease to be the custodian of such Fund's or Portfolio's assets;
provided that the provisions of this Section 11.1(k) shall not apply to
a change of a Fund's or Portfolio's investment adviser in which such
investment adviser is replaced by an Adviser or an Affiliate of an
Adviser.
(l) Investment Restrictions; Investment Policies. Such Fund or
Portfolio, as the case may be, shall violate or take any action that
would result in a violation of any of the investment restrictions or
fundamental investment policies of such Fund or Portfolio as from time
to time in effect where such violation would have a Material Adverse
Effect upon such Fund or Portfolio.
(m) Adviser Change in Control. There occurs a Change in
Control of a Fund's Adviser.
11.2 Remedies. If any Event of Default described in Section
11.1 shall have occurred and be continuing, the Administrative Agent and
Documentation Agent may, and following the direction of the Majority Banks
shall, declare the Commitments to be terminated with respect to the applicable
Fund or Portfolio, as the case may be, and such Fund's or Portfolio's, as the
case may be, obligations under its Notes to be due and payable, whereupon the
Commitments shall immediately terminate with respect to such Fund or Portfolio,
as the case may be, and such Fund's or Portfolio's, as the case may be, Notes
shall become immediately due and payable, all without advance notice of any kind
(except that if an event described in Section 11.1(e) occurs, the Commitments
shall immediately terminate with respect to such Fund or Portfolio, as the case
may be, and the obligations under the Notes with respect to such Fund or
Portfolio, as the case may be, shall become immediately due and payable without
declaration or advance notice of any kind). The Administrative Agent and
Documentation Agent shall promptly advise such Fund or Portfolio, as the case
may be, of any such declaration, but failure to do so shall not impair the
effect of such declaration. If an Event of Default shall have occurred, the
Administrative Agent and Documentation Agent may exercise on behalf of itself
and the Banks all rights and remedies available to it and the Banks against such
Fund or Portfolio under the Credit Documents or applicable law.
12. THE AGENTS
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12.1 Appointment and Authorization. Each Bank hereby
irrevocably (subject to Section 12.9) appoints, designates and authorizes each
Agent to take such action on its behalf under the provisions of this Agreement
and each other Credit Document and to exercise such powers and perform such
duties as are expressly delegated to it by the terms of this Agreement or any
other Credit Document, together with such powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary contained elsewhere in
this Agreement or in any other Credit Document, no Agent shall have any duties
or responsibilities, except those expressly set forth herein, nor shall an Agent
have or be deemed to have any fiduciary relationship with any Bank, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Credit Document or
otherwise exist against any Agent.
12.2 Delegation of Duties. An Agent may execute any of its
duties under this Agreement or any other Credit Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. An Agent shall not be
responsible for the negligence or misconduct of any agent or attorney-in-fact
that it selects with reasonable care.
12.3 Liability of Agent. None of the Agent-Related Persons
shall (i) be liable to the Banks for any action taken or omitted to be taken by
any of them under or in connection with this Agreement or any other Credit
Document or the transactions contemplated hereby (except for its own gross
negligence or willful misconduct) or (ii) be responsible in any manner to any of
the Banks for any recital, statement, representation or warranty made by a Fund
or Portfolio or any officer or agent thereof contained in this Agreement or in
any other Credit Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by an Agent under or in
connection with, this Agreement or any other Credit Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Credit Document, or for any failure of a Fund or Portfolio or any
other party to any Credit Document to perform its obligations hereunder or
thereunder. No Agent-Related Person shall be under any obligation to any Bank to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in or conditions of this Agreement or any other Credit
Document or to inspect the properties, books or records of a Fund or Portfolio.
12.4 Reliance by Agent. (a) An Agent shall be entitled to
rely, and shall be fully protected in relying, upon any writing, resolution,
notice, consent, certificate, affidavit, letter, telegram, facsimile, telex or
telephone message, statement, or other document or conversation believed by it
to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including
counsel to the Funds), independent accountants and other experts selected by
such Agent. An Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Credit Document unless it shall first
receive such advice or concurrence of the Majority Banks as it deems
appropriate, and if it so requests, it shall first be indemnified to its
satisfaction by the Banks against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action (other
than liability or expense arising from its gross negligence or willful
misconduct). An Agent shall in all cases be fully protected from any claim by
any Bank in acting, or in refraining from acting, under this Agreement or any
36
other Credit Document in accordance with a request or consent of the Majority
Banks and such request, and any action taken or failure to act pursuant thereto
shall be binding upon all of the Banks.
(b) For purposes of determining compliance with the conditions
specified in Section 9, each Bank that has executed this Agreement shall be
deemed to have consented to, approved or accepted, or be satisfied with each
document or other matter either sent by the Administrative Agent and
Documentation Agent to such Bank for consent, approval, acceptance or
satisfaction, or required thereunder to be consented to, approved by, acceptable
or satisfactory to the Bank.
12.5 Notice of Event of Default. No Agent shall be deemed to
have knowledge or notice of the occurrence of any Event of Default, except, in
the case of the Operations Agent, with respect to defaults in the payment of
principal, interest and fees required to be paid to the Operations Agent for the
account of the Banks, unless such Agent shall have received written notice from
a Bank or a Fund referring to this Agreement, describing such Event of Default
and stating that such notice is a "notice of default." The applicable Agent will
notify the other Agent and the Banks of its receipt of any such notice. The
Administrative Agent and Documentation Agent shall take such action with respect
to such Event of Default as may be requested by the Majority Banks in accordance
with Section 11.2; provided, however, that unless and until the Administrative
Agent and Documentation Agent has received any such request, the Administrative
Agent and Documentation Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such Event of
Default as it shall deem advisable or in the best interest of the Banks.
12.6 Credit Decision. Each Bank acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it and that no
act by the an Agent hereinafter taken, including any review of the affairs of
the Funds and the Portfolios, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Bank. Each Bank represents to the
Agents that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition, and creditworthiness of the
Funds and the Portfolios, and all applicable bank regulatory laws relating to
the transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Funds and the Portfolios hereunder.
Each Bank also represents that it will, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Credit Documents and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition, and creditworthiness of the Funds and the Portfolios.
Except for notices, reports and other documents expressly herein required to be
furnished to the Banks by an Agent, no Agent shall have any duty or
responsibility to provide any Bank with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition, or creditworthiness of the Funds and the Portfolios which may come
into the possession of any of the Agent-Related Persons.
12.7 Indemnification of Agents. Whether or not the
transactions contemplated hereby are consummated, the Banks shall indemnify upon
37
demand the Agents and the Agent-Related Persons (to the extent not reimbursed by
or on behalf of the Funds and without limiting the obligation of the Funds to do
so), pro rata, from and against any and all Indemnified Liabilities; provided,
however, that no Bank shall be liable for the payment to an Agent or the
Agent-Related Persons of any portion of such Indemnified Liabilities resulting
from such Person's gross negligence or willful misconduct. Without limitation of
the foregoing, each Bank shall reimburse an Agent upon demand for its ratable
share of any costs or out-of-pocket expenses (including Attorney Costs) incurred
by such Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Credit Document, or
any document contemplated by or referred to herein, to the extent that such
Agent is not reimbursed for such expenses by or on behalf of the Funds. The
undertaking in this Section shall survive the payment of all obligations
hereunder and under the Notes and the resignation or replacement of the relevant
Agent.
12.8 Agents in Individual Capacity. Each Agent and any
Affiliate of any such Person may make loans to, issue letters of credit for the
account of, accept deposits from, acquire equity interests in and generally
engage in any kind of banking, trust, financial advisory, underwriting or other
business with the Funds, the Portfolios and their Affiliates as though such
Agent were not an Agent hereunder and without notice to or consent of the Banks.
The Banks acknowledge that, pursuant to such activities, an Agent or its
Affiliates may receive information regarding the Funds, the Portfolios or their
Affiliates (including information that may be subject to confidentiality
obligations in favor of the Funds, the Portfolios or their Affiliates) and
acknowledge that such Agent shall not be under any obligation to provide such
information to them. With respect to its Loans, an Agent shall have the same
rights and powers under this Agreement as any other Bank and may exercise the
same as though it were not an Agent and the terms "Bank" and "Banks" include
such Agent in its individual capacity.
12.9 Successor Agent. Either the Administrative Agent and
Documentation Agent or the Operations Agent may, and at the request of the
Majority Xxxxx shall, resign as Agent upon 30 days' notice to the Banks, the
Funds and the Portfolios. If an Agent resigns under this Agreement, the Majority
Banks shall appoint from among the Banks a successor agent for the Banks, which
successor agent shall be subject to approval by the Funds and the Portfolios. If
no successor agent is appointed prior to the effective date of the resignation
of such Agent, such Agent may appoint, after consulting with the Banks, the
Funds and the Portfolios, a successor agent from among the Banks. Upon the
acceptance of its appointment as successor agent xxxxxxxxx, such successor agent
shall succeed to all the rights, powers and duties of the retiring Agent and the
term "Agent" shall mean such successor agent, and the retiring Agent's
appointment, powers and duties as Agent shall be terminated. After any retiring
Agent's resignation hereunder as Agent, the provisions of this Section 12 and
Sections 13.3 and 13.4 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent under this Agreement. If no
successor agent has accepted appointment as Agent by the date which is 30 days
following a retiring Agent's notice of resignation, the retiring Agent's
resignation shall nevertheless thereupon become effective, the Banks shall
perform all of the duties of the resigning Agent hereunder and the Funds and
Portfolios shall make any payments otherwise required to be made by them
hereunder to the Operations Agent (if it shall be the resigning Agent) to the
Banks directly until such time, if any, as the Majority Xxxxx appoint a
successor agent as provided for above.
38
13. GENERAL.
13.1 Waiver and Amendments. No failure or delay on the part of
the Banks in the exercise of any power or right, and no course of dealing
between any Fund or Portfolio and the Banks, shall operate as a waiver of such
power or right, nor shall any single or partial exercise of any power or right
preclude other or further exercise thereof or the exercise of any other power or
right. The remedies provided for herein are cumulative and not exclusive of any
remedies which may be available to the Banks at law or in equity. No notice to
or demand on a Fund or Portfolio not required hereunder or under such Fund's or
Portfolio's Notes shall in any event entitle such Fund or Portfolio to any other
or further notice or demand in similar or other circumstances or constitute a
waiver of the right of the Banks to any other or further action in any
circumstances without notice or demand. No amendment or waiver of any provision
of any Credit Document, and no consent with respect to any departure by a Fund
or Portfolio therefrom, shall be effective unless the same shall be in writing
and adopted by the Majority Banks and each Fund and Portfolio, and then any such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided that no such amendment, waiver or
consent shall, unless in writing and signed by each Bank, do any of the
following:
(a) increase or extend the Commitment of any Bank (or
reinstate any Commitment terminated pursuant to Section 11.2),
(b) postpone or delay any date fixed by any Credit Document
for any payment of principal of or interest on the Loans or any fees or
other amounts in connection therewith,
(c) reduce the principal of or interest on any Loan,
(d) reduce any fees or other amounts payable to any of the
Banks under any Credit Document, or
(e) amend the definition of "Majority Banks" or any provision
of this Section 13.1;
and provided, further, that no amendment, waiver or consent shall affect the
rights or duties of any Agent under any Credit Document, unless in writing and
signed by the affected Agent in addition to the Majority Banks or all Banks, as
the case may be,.
13.2 Notices. Except as otherwise expressly provided herein,
any notice hereunder to each Fund or Portfolio, the Agents or the Banks shall be
in writing (including telegraphic or telecopy communication) and shall be given
to the intended recipient at its address or telecopier number set forth on
Schedule II hereto or at such other address or telecopier number as such Person
may, by written notice, designate as its address or telecopier number for
purposes of notice hereunder. All such notices shall be deemed to be given when
transmitted by telecopier, delivered to the telegraph office, personally
delivered or, in the case of a mailed notice, when sent by registered or
certified mail, postage prepaid, in each case addressed as specified in this
Section 13.2; provided, however, that notices to the Administrative Agent and
39
Documentation Agent under Section 1.1 (definition of the term "Termination
Date") and to the Operations Agent under Sections 2.3, 2.4, 4.2 and 4.3 shall
not be effective until actually received by the applicable Agent.
13.3 Expenses. Subject to the provisions of Section 2.6, each
Fund and Portfolio shall:
(i) whether or not any Loan is made hereunder, pay or
reimburse each of Fleet (solely in its capacity as Administrative Agent
and Documentation Agent) and State Street, solely in its capacity as
Operations Agent, within five Banking Days after demand for all
reasonable costs and expenses incurred by it in connection with the
development, preparation, delivery, administration and execution of,
and any amendment, supplement, waiver or modification to (in each case,
whether or not consummated), this Agreement, any Credit Document and
any other documents prepared in connection herewith or therewith, and
the consummation of the transactions contemplated hereby and thereby,
including reasonable Attorney Costs incurred by Fleet (solely in its
capacity as Administrative Agent and Documentation Agent) and State
Street, solely in its capacity as Operations Agent, with respect
thereto.
(ii) pay or reimburse the Administrative Agent and
Documentation Agent and each Bank within five Banking Days after demand
for all costs and expenses (including reasonable Attorney Costs)
incurred by them in connection with the enforcement, attempted
enforcement, or preservation of any rights or remedies under this
Agreement or any other Credit Document during the existence of an Event
of Default or after acceleration of the Loans (including in connection
with any "workout" or restructuring regarding the Loans and including
in any insolvency proceeding or appellate proceeding).
13.4 Funds Indemnification.
(a) Subject to the provisions of Section 2.6, whether or not the
transactions contemplated hereby are consummated, the Funds and Portfolios shall
indemnify and hold the each Agent and its Affiliates, each Agent-Related Person
and each Bank and each of its respective officers, directors, employees,
counsel, agents and attorneys-in-fact (each, an "Indemnified Person"), harmless
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, charges, expenses and disbursements
(including Attorney Costs) of any kind or nature whatsoever which may at any
time (including at any time following repayment of the Loans and the
termination, resignation or replacement of an Agent or replacement of any Bank)
be imposed on, incurred by or asserted against any such Person in any way
relating to or arising out of this Agreement or any document contemplated by or
referred to herein, or the transactions contemplated hereby, or any action taken
or omitted by any such Person under or in connection with any of the foregoing,
including with respect to any investigation, litigation or proceeding (including
any insolvency proceeding or appellate proceeding) related to or arising out of
this Agreement or the Loans or the use of the proceeds thereof, whether or not
any Indemnified Person is a party thereto (all the foregoing, collectively, the
"Indemnified Liabilities"); provided that (i) no Fund or Portfolio shall have an
40
obligation hereunder to any Indemnified Person with respect to Indemnified
Liabilities resulting from the gross negligence or willful misconduct of such
Indemnified Person and (ii) each Fund and Portfolio shall be liable only for its
portion of the Indemnified Liabilities and such Fund or Portfolio shall not be
liable for any portion of the Indemnified Liabilities of any other Fund or
Portfolio. The Funds shall from time to time notify the Operations Agent and the
Administrative Agent and Documentation Agent of the manner in which the
Indemnified Liabilities are to be allocated among the Funds and Portfolios.
(b) Promptly after receipt by an Indemnified Person under subsection
(a) above of notice of the commencement of any action, such Indemnified Person
shall, if a claim in respect thereof is to be made against a Fund or Portfolio
under such subsection, promptly notify such Fund or Portfolio in writing of the
commencement thereof, but the omission so to notify such Fund or Portfolio shall
not relieve it from any liability which it may have to any Indemnified Person
otherwise than under such subsection. In case any such action shall be brought
against any Indemnified Person and it shall notify the relevant Fund or
Portfolio of the commencement thereof, the indemnifying Fund or Portfolio shall
be entitled to participate therein and, to the extent that it shall wish,
jointly with any other Fund or Portfolio similarly notified, to assume the
defense thereof, with counsel reasonably satisfactory to such Indemnified Person
(who shall not, except with the consent of the Indemnified Person, be counsel to
the indemnifying Fund(s) or Portfolio(s)), and, upon such assumption, the
indemnifying Fund(s) and/or Portfolio(s) shall no longer be responsible for the
Attorney Costs of counsel retained by such Indemnified Person; provided that in
no event shall any settlement or compromise of any such claims, actions or
demands be made without the consent of the Indemnified Person, the consent of
which shall not be unreasonably withheld.
(c) The agreements in this Section 13.4 shall survive payment of all
other obligations of the Funds and Portfolios hereunder and under the Notes.
13.5 Information. Each of the Administrative Agent and
Documentation Agent, the Operations Agent and the Banks agree not to disclose
without the prior consent of any Fund or Portfolio any information with respect
to such Fund or Portfolio that is furnished pursuant to this Agreement and that
is designated by or on behalf of the Fund or Portfolio as confidential, except
that each of the Administrative Agent and Documentation Agent and the Operations
Agent or any Bank may disclose any such information (a) as has become generally
available to the public other than by breach of this Section 13.5, (b) as may be
required by law or legal process, (c) to examiners and regulatory agencies
having jurisdiction over the Administrative Agent and Documentation Agent, the
Operations Agent or any Bank and (d) to potential participants and assignees,
provided that any such participant or assignee has been made aware of this
Section 13.5 and agreed in writing to be bound by its provisions.
13.6 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
13.7 Law. This Agreement and the Notes shall be contracts made
under and governed by the internal laws of the State of New York. This
41
Agreement, the Notes, the Indemnification Agreement, the Operations Agent Letter
and the other Credit Documents constitute the entire understanding among the
parties hereto with respect to the subject matter hereof and supersede any prior
agreements, written or oral, with respect thereto.
13.8 Successors. (a) This Agreement shall be binding upon the
Funds, the Portfolios, the Agents and the Banks and their respective successors
and assigns and shall inure to the benefit of the Funds, the Portfolios, the
Agents and the Banks and the permitted successors and assigns of the Agents and
the Banks.
(b) No Fund or any Portfolio may assign its rights or duties hereunder
without the consents of the Banks and the Agents. Any Bank may at any time, with
the consents of the Funds and Portfolios and the Administrative Agent and
Documentation Agent (which consents shall not be unreasonably withheld), assign
and delegate to one or more Eligible Lenders (each an "Assignee") all, or any
ratable part of all (in such case, in a minimum amount of $5,000,000), of the
Loans, the Commitments and the other rights and obligations of such Bank
hereunder; provided, however, that the foregoing consents of the Funds and
Portfolios shall not be required with regard to an assignment that otherwise
meets the foregoing criteria (i) to an Assignee that is an Affiliate of the
assigning Bank or (ii) during such time as an Event of Default has occurred and
is continuing; provided, further, that the Funds and Portfolios and the Agents
may continue to deal solely and directly with such Bank in connection with the
interest so assigned to an Assignee until (A) written notice of such assignment,
together with payment instructions, addresses and related information with
respect to the Assignee, shall have been given to the Funds and Portfolios and
the Agents by such Bank and the Assignee; (B) such Bank and its Assignee shall
have delivered to the Funds and Portfolios and the Administrative Agent and
Documentation Agent an Assignment and Acceptance in the form of Exhibit J
("Assignment and Acceptance") together with any Note or Notes subject to such
assignment; (C) the Administrative Agent and Documentation Agent has in writing
consented to the assignment and, to the extent required, obtained the written
consents of the Funds and Portfolios; and (D) the assignor Bank or the Assignee
has paid to the Administrative Agent and Documentation Agent a processing fee in
the amount of $3,500. From and after the date that the Administrative Agent and
Documentation Agent notifies the assignor Bank that it has received an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(x) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Bank under
the Credit Documents and (y) the assignor Bank shall, to the extent that rights
and obligations hereunder and under the other Credit Documents have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Credit Documents. A Bank may,
without the consent of any of the Funds or the Portfolios or the Administrative
Agent and Documentation Agent, grant a security interest in a Note and, in
connection therewith, assign its rights in such Note, to any Federal Reserve
Bank in accordance with applicable law.
(c) Any Bank may at any time sell to one or more Eligible Lenders
(each, a "Participant") participating interests in any Loans, the Commitment of
such Bank and the other interests of such Bank in any Loans, (the "Originating
Bank") under the Credit Documents; provided, however, that: (i) the Originating
Bank's obligations under this Agreement shall remain unchanged, (ii) the
Originating Bank shall remain solely responsible for the performance of such
42
obligations, (iii) the Funds and Portfolios and the Agents shall continue to
deal solely and directly with the Originating Bank in connection with the
Originating Bank's rights and obligations under the Credit Documents and (iv) no
Bank shall transfer or grant any participating interest under which the
Participant has rights to approve any amendment to, or any consent or waiver
with respect to, any Credit Document, except to the extent such amendment,
consent or waiver would require unanimous consent of the Banks as described in
the first proviso to Section 13.1. In the case of any such participating
interest, the Participant shall be entitled to the benefit of Sections 5.1, 5.3,
5.4, 5.5 and 13.4 as though it were also a Bank hereunder (and the Originating
Bank shall not be entitled to the benefits of such sections with respect to the
portion of any Loans in which it has sold a participating interest), and if
amounts outstanding under the Credit Documents are due and unpaid, or shall have
been declared or shall have become due and payable upon the occurrence of an
Event of Default, each Participant shall be deemed to have the right of set-off
in respect of its participating interest in amounts owing under the Credit
Documents to the same extent as if the amount of its participating interest were
owing directly to it as a Bank under this Agreement.
13.9 Waiver of Jury Trial. EACH OF THE OPERATIONS AGENT, THE
ADMINISTRATIVE AGENT AND DOCUMENTATION AGENT, EACH BANK AND EACH FUND AND
PORTFOLIO WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO
ENFORCE OR DEFEND ANY RIGHTS (i) UNDER THIS AGREEMENT OR UNDER ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE
DELIVERED IN CONNECTION HEREWITH OR (ii) ARISING FROM ANY BANKING RELATIONSHIP
ARISING IN CONNECTION WITH THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
13.10 Disclaimer. None of the shareholders, trustees,
officers, employees and other agents of any Fund or Portfolio shall be
personally bound by or liable for any indebtedness, liability or obligation
hereunder, under any Note or under any judgment on this Agreement or any Note
nor shall resort be had to their private property for the satisfaction of any
obligation or claim hereunder or thereunder.
13.11 Acknowledgments. The signatories hereto acknowledge that
the Funds and Portfolios listed on Annex I under the heading "Continuing
Borrower Parties" will continue as parties hereto and the Fund and Portfolio
listed on Annex I under the heading "Non-Continuing Borrower Parties" will no
longer be party hereto. The signatories hereto acknowledge that the name of LM
Institutional Fund Advisors II, Inc. has been changed to Xxxx Xxxxx Xxxxxxx
Street Trust, Inc. The Banks party to the Existing Credit Agreement acknowledge
that, as of the Refinancing Date, the Notes of the Non-Continuing Borrower
Parties shall cease to be of any further force or effect.
13.12 Other. The parties hereto acknowledge that the
Syndication Agent has been designated as such for purposes of convenience only,
and that the Syndication Agent shall not have any duties or responsibilities,
except those that may be expressly set forth in one or more separate written
agreements, or any fiduciary relationship with any Bank, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or otherwise exist against the Syndication Agent.
43
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
first written above.
XXXX XXXXX INCOME TRUST, INC., ON
BEHALF OF XXXX XXXXX U.S.
GOVERNMENT INTERMEDIATE-TERM PORTFOLIO
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX INCOME TRUST, INC., ON
BEHALF OF XXXX XXXXX INVESTMENT
GRADE INCOME PORTFOLIO
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX INCOME TRUST, INC., ON
BEHALF OF XXXX XXXXX HIGH YIELD PORTFOLIO
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX TAX-FREE INCOME FUND,
ON BEHALF OF XXXX XXXXX MARYLAND
TAX-FREE INCOME TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
S-1
XXXX XXXXX TAX-FREE INCOME FUND,
ON BEHALF OF XXXX XXXXX PENNSYLVANIA
TAX-FREE INCOME TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX TAX-FREE INCOME FUND,
ON BEHALF OF XXXX XXXXX TAX-FREE
INTERMEDIATE-TERM INCOME TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX VALUE TRUST, INC.
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX SPECIAL INVESTMENT TRUST, INC.
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX FOCUS TRUST, INC.
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX GLOBAL TRUST, INC., ON
BEHALF OF XXXX XXXXX GLOBAL INCOME TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
S-2
XXXX XXXXX GLOBAL TRUST, INC., ON BEHALF
OF XXXX XXXXX INTERNATIONAL EQUITY TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX GLOBAL TRUST, INC., ON
BEHALF OF XXXX XXXXX EMERGING MARKETS TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX GLOBAL TRUST, INC., ON
BEHALF OF XXXX XXXXX EUROPE FUND
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX INVESTORS TRUST, INC.,
ON BEHALF OF XXXX XXXXX AMERICAN
LEADING COMPANIES TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX INVESTORS TRUST, INC.,
ON BEHALF OF XXXX XXXXX BALANCED TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
S-3
XXXX XXXXX INVESTORS TRUST, INC., ON
BEHALF OF XXXX XXXXX U.S.
SMALL-CAPITALIZATION VALUE TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX INVESTORS TRUST, INC., ON
BEHALF OF XXXX XXXXX FINANCIAL
SERVICES FUND
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX LIGHT STREET TRUST, INC., ON
BEHALF OF XXXX XXXXX CLASSIC VALUATION FUND
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX INVESTMENT TRUST, INC., ON
BEHALF OF XXXX XXXXX OPPORTUNITY TRUST
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
XXXX XXXXX XXXXXXX STREET TRUST, INC.,
ON BEHALF OF BATTERYMARCH U.S. SMALL
CAPITALIZATION EQUITY PORTFOLIO
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Title: Vice President and Secretary
S-4
FLEET NATIONAL BANK, as Administrative Agent
and Documentation Agent and a Bank
By: /s/ Xxxx Xxx Xxxxxx
-------------------------------------
Title: Director
S-5
STATE STREET BANK AND TRUST COMPANY, as
Operations Agent and a Bank
By: /s/ Xxxx Xxxxx Xxxxxxxx
-------------------------------------
Title: Vice President
S-6
NATIONAL BANK OF AUSTRALIA LIMITED,
A.C.N. 004044937
By: /s/ Xxxxxxx X. XxXxxx
-------------------------------------
Title: Vice President
S-7
DANSKE BANK A/S
By: /s/ Xxxxxx Xxxxxxxxxx
-------------------------------------
Title: Vice President
By: /s/ Xxxx X. X'Xxxxx
-------------------------------------
Title: Assistant General Manager
S-8
THE BANK OF NOVA SCOTIA, as Syndication
Agent and a Bank
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Title: Director
S-9
THE BANK OF NEW YORK
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Title: Vice President
S-10
BANK OF AMERICA, N.A.
By: /s/ X. Xxx Xxxxxxxxx
-------------------------------------
Title: Managing Director
S-11
ANNEX I
Current Borrower Parties
------------------------
Xxxx Xxxxx Income Trust, Inc., on behalf of
Xxxx Xxxxx U.S. Government Intermediate-Term Portfolio
Xxxx Xxxxx Investment Grade Income Portfolio
Xxxx Xxxxx High Yield Portfolio
Xxxx Xxxxx Tax-Free Income Fund, on behalf of
Xxxx Xxxxx Maryland Tax-Free Income Trust
Xxxx Xxxxx Pennsylvania Tax-Free Income Trust
Xxxx Xxxxx Tax-Free Intermediate-Term Income Trust
Xxxx Xxxxx Value Trust, Inc.
Xxxx Xxxxx Total Return Trust, Inc.
Xxxx Xxxxx Special Investment Trust, Inc.
Xxxx Xxxxx Focus Trust, Inc.
Xxxx Xxxxx Global Trust, Inc., on behalf of
Xxxx Xxxxx Global Income Trust
Xxxx Xxxxx International Equity Trust
Xxxx Xxxxx Emerging Markets Trust
Xxxx Xxxxx Europe Fund
Xxxx Xxxxx Investors Trust, Inc., on behalf of
Xxxx Xxxxx American Leading Companies Trust
Xxxx Xxxxx Balanced Trust
Xxxx Xxxxx U.S. Small-Capitalization Value Trust
Xxxx Xxxxx Financial Services Fund
Xxxx Xxxxx Light Street, Inc., on behalf of
Xxxx Xxxxx Classic Valuation Fund
Xxxx Xxxxx Investment Trust, Inc.
Xxxx Xxxxx Opportunity Trust
LM Value Institutional Portfolio
I-1
Xxxx Xxxxx Xxxxxxx Street Trust, Inc., on behalf of
LM Value Institutional Portfolio
Batterymarch U.S. Small Capitalization Equity Portfolio
Continuing Borrower Parties
---------------------------
Xxxx Xxxxx Income Trust, Inc., on behalf of
Xxxx Xxxxx U.S. Government Intermediate-Term Portfolio
Xxxx Xxxxx Investment Grade Income Portfolio
Xxxx Xxxxx High Yield Portfolio
Xxxx Xxxxx Tax-Free Income Fund, on behalf of
Xxxx Xxxxx Maryland Tax-Free Income Trust
Xxxx Xxxxx Pennsylvania Tax-Free Income Trust
Xxxx Xxxxx Tax-Free Intermediate-Term Income Trust
Xxxx Xxxxx Value Trust, Inc.
Xxxx Xxxxx Special Investment Trust, Inc.
Xxxx Xxxxx Focus Trust, Inc.
Xxxx Xxxxx Global Trust, Inc., on behalf of
Xxxx Xxxxx Global Income Trust
Xxxx Xxxxx International Equity Trust
Xxxx Xxxxx Emerging Markets Trust
Xxxx Xxxxx Europe Fund
Xxxx Xxxxx Investors Trust, Inc., on behalf of
Xxxx Xxxxx American Leading Companies Trust
Xxxx Xxxxx Balanced Trust
Xxxx Xxxxx U.S. Small-Capitalization Value Trust
Xxxx Xxxxx Financial Services Fund
Xxxx Xxxxx Light Street, Inc., on behalf of
Xxxx Xxxxx Classic Valuation Fund
Xxxx Xxxxx Investment Trust, Inc.
Xxxx Xxxxx Opportunity Trust
I-2
Xxxx Xxxxx Xxxxxxx Street Trust, Inc., on behalf of
Batterymarch U.S. Small Capitalization Equity Portfolio
Non-Continuing Borrower Parties
-------------------------------
Xxxx Xxxxx Total Return Trust, Inc.
LM Value Institutional Portfolio
I-3
