EXHIBIT 10.02
L O A N A G R E E M E N T
Between
PANDA INTERFUNDING CORPORATION,
as Lender
and
PANDA CAYMAN INTERFUNDING COMPANY,
as Borrower
Dated as July 31, 1996
TABLE OF CONTENTS
ARTICLE 1 GENERAL TERMS 2
Section 1.01 Terms Defined Above 2
Section 1.02 Certain Definitions 2
Section 1.03 Accounting Principles 7
ARTICLE 2 AMOUNT AND TERMS OF LOAN 7
Section 2.01 Loans and Notes 7
Section 2.02 Interest Rate 7
Section 2.03 Computation 7
Section 2.04 Prepayments; Redemptions 8
Section 2.05 Payment Procedure 8
Section 2.06 Business Days 8
ARTICLE 3 REPRESENTATIONS AND WARRANTIES 9
Section 3.01 Corporate Existence. 9
Section 3.02 Corporate Power and Authorization 9
Section 3.03 Binding Obligations 9
Section 3.04 No Consent; Legal Bar or Resultant Lien 9
Section 3.05 Titles, etc. 10
Section 3.06 Defaults 10
Section 3.07 Use of Proceeds 10
Section 3.08 Compliance with Law 10
ARTICLE 4 AFFIRMATIVE COVENANTS 11
Section 4.01 Maintenance 11
Section 4.02 Further Assurances 11
Section 4.03 Performance of Obligations 11
Section 4.04 Reimbursement of Expenses 11
ARTICLE 5 NEGATIVE COVENANT 12
ARTICLE 6 EVENTS OF DEFAULT 12
Section 6.01 Events 12
Section 6.02 Remedies 12
Section 6.03 Right of Set-off 12
ARTICLE 7 CONDITIONS OF LENDING 13
Section 7.01 Loans 13
ARTICLE 8 MISCELLANEOUS 14
Section 8.01 Notices 14
Section 8.02 Amendments and Waivers 14
Section 8.03 Invalidity 14
Section 8.04 Survival of Agreements 14
Section 8.05 Successors and Assigns 14
Section 8.06 Renewal, Extension or Rearrangement 14
Section 8.07 Cumulative Rights 14
Section 8.08 Singular and Plural 15
Section 8.09 Construction 15
Section 8.10 Interest 15
Section 8.11 Entire Agreement 16
Section 8.12 Exhibits 16
Section 8.13 Titles of Articles, Sections and Subsections 16
Section 8.14 Counterparts 16
Exhibit A - Form of Note
LOAN AGREEMENT
THIS LOAN AGREEMENT is made and entered into as of July 31,
1996, by and between PANDA CAYMAN INTERFUNDING COMPANY, a Cayman
Islands exempted company, with a principal address of in care of
Xxxxxx and Xxxxxx, Xxxxxx House, South Church Street, Grand
Cayman, Cayman Islands, British West Indies (the "Borrower"), and
PANDA INTERFUNDING CORPORATION, a Delaware corporation, with
offices at 0000 Xxxxxx Xxxxxx Xxxx, Xxxxx 0000, Xxxxxx, Xxxxx
00000 ("PIC").
RECITALS
WHEREAS, PIC has formed Panda Funding Corporation, a Delaware
corporation ("Panda Funding") as a special purpose, wholly-owned
finance subsidiary to issue debt securities constituting the
Bonds described below;
WHEREAS, Panda Funding, PIC and Bankers Trust Company, as
Trustee, a New York banking corporation (the "Trustee"), (as
trustee for the holders of the Bonds described below) are party
to an Indenture dated as of July 31, 1996 (as amended,
supplemented or otherwise modified and in effect from time to
time, the "Indenture"), providing, subject to the terms and
conditions thereof, for the issuance by Panda Funding from time
to time of certain Pooled Project Bonds (the "Bonds"), including,
without limitation, $105,525,000 initial aggregate principal
amount of 11 5/8% Pooled Project Bonds, Series A due 2012 (the
"Series A Bonds");
WHEREAS, Panda Funding will loan the entire proceeds of the
issuance of the Series A Bonds (the "PIC Loan") to PIC, which PIC
Loan will be made under a Loan Agreement dated of even date with
the Indenture by and between Panda Funding and PIC (the "PIC Loan
Agreement") and evidenced by a promissory note (the "Initial PIC
Note") of PIC dated July 31, 1996, and payable to Panda Funding;
WHEREAS, Panda Funding may from time to time loan the proceeds
of subsequent series of Bonds (the "Additional PIC Loans") to PIC,
which Additional PIC Loans will be made under the PIC Loan
Agreement and evidenced by promissory notes (the "Additional PIC
Notes") of PIC payable to Panda Funding;
WHEREAS, PIC may from time to time, on-lend the proceeds of the
PIC Loan or the Additional PIC Loans to the Borrower pursuant to
the terms of this Agreement;
WHEREAS, to induce the purchase of the Bonds by the Holders,
which Borrower acknowledges is of substantial benefit to it (as a
potential ultimate recipient of certain proceeds of the Bonds via
loans made by PIC to it hereunder) and of substantial benefit to
its parent, PIC, as the recipient of the PIC Loan evidenced by
the Initial PIC Note and pursuant to Additional PIC Loans
evidenced by Additional PIC Notes, of the proceeds of the
issuance of the Bonds, Borrower has agreed to enter into this
Agreement;
NOW THEREFORE, in consideration of the mutual covenants and
agreements herein contained and of the loans hereinafter referred
to, the Borrower and PIC agree as follows:
ARTICLE 1
GENERAL TERMS
Section 1.01 Terms Defined Above. As used in this Loan
Agreement, the terms "Borrower" and "PIC" and the capitalized
terms defined in the Recitals shall have the meanings indicated
above. Certain other capitalized terms used herein that are not
defined herein shall have the meanings given such terms in the
Indenture.
Section 1.02 Certain Definitions. As used in this Agreement,
the following terms shall have the following meanings, unless the
context otherwise requires:
"Agreement" shall mean this Loan Agreement, as the same may
from time to time be amended or supplemented.
"Business Day" shall mean a day other than (i) a Saturday or
Sunday or (ii) a day on which commercial banks in New York,
New York, Dallas Texas, the Cayman Islands or any city in
which the Trustee's corporate trust office, the Collateral
Agent's principal office or the International Collateral
Agent's principal office is located, are authorized or
required to be closed.
"Capital Lease" shall mean any lease of property, real or
personal, which in accordance with GAAP, would be required
to be capitalized on the balance sheet of the lessee
thereof.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Debt" of any Person shall mean at any date, without
duplication, (i) all obligations of such Person for borrowed
money, (ii) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase
price of property or services, (iv) all obligations under
Capital Leases of such Person, (v) all Debt of others
secured by a Lien on any asset of such Person, whether or
not such Debt is assumed by such Person, (vi) all Debt of
others to the extent Guaranteed by such Person, (vii) all
obligations under letters of credit issued for the account
of such Person, (viii) all obligations of such Person under
trade or bankers' acceptances and (ix) all obligations of
such Person under any agreements or options providing for
swaps, ceiling rates, floor rates, contingent participation
or other hedging mechanisms with respect to the payment of
interest.
"Default" shall mean the occurrence of any of the events
specified in Section 6.01, whether or not any requirement
for notice or lapse of time or other condition precedent has
been satisfied.
"Event of Default" shall mean the occurrence of any of the
events specified in Section 6.01, provided that any
requirement for notice or lapse of time or any other
condition precedent has been satisfied.
"Excepted Liens" shall mean: (i) Liens created or otherwise
expressly permitted or required to exist by this Agreement
or any other Transaction Document (as defined in the
Indenture); (ii) Liens for taxes, assessments, charges,
levies, claims or obligations which are either not yet due,
are due but payable without penalty or are the subject of a
Good Faith Contest by the Borrower; (iii) legal or equitable
encumbrances deemed to exist by reason of the existence of
any litigation or other legal proceeding if the same are the
subject of a Good Faith Contest; (iv) with respect to
Property of the Borrower or any Subsidiary or the Project
Distributions (as defined in the Indenture) of the Borrower
or any Subsidiary, Liens required or permitted to exist by
the Project Agreements if such Liens were required to exist
or existed (A) on the date the Series A Bonds are issued or
(B) with respect to Liens upon or with respect to Property
or the Project Distributions relating to a particular
Project (as defined in the Indenture), at the time PIC or
any PIC Entity (as defined in the Indenture) makes its
initial capital contribution or purchase price payment with
respect to such Project or receives interests in such
Project acquired subsequent to such initial contribution or
payment, or any replacement or successor Lien created in
connection with the refinancing of any Project, provided
such replacement or successor Lien shall not secure any
monetary obligation materially greater than the Lien it
replaces or succeeds or encumber any Property not subject to
the Lien it replaces or succeeds unless (and only to the
extent that) the provisions for incurring or refinancing
Project Debt (as defined in the Indenture) contained in
Section 7.23 of the Indenture have been satisfied; (v) Liens
in connection with worker's compensation, unemployment
insurance or other social security or pension obligations;
and (vi) with respect to Property of, or Project
Distributions to, the Borrower or any of its Subsidiaries,
Liens other than to secure Debt, provided such Lien could
not reasonably be expected to (A) result in a Material
Adverse Change or (B) materially diminish the value of, or
the security offered by, the Property subject to such Lien.
"GAAP" shall mean, as of any date of determination,
generally accepted accounting principles then in effect in
the United States of America.
"GAAP Reserves" shall mean, with respect to any item which
is the subject of a Good Faith Contest, accounting reserves
which are established and maintained pursuant to GAAP.
"Good Faith Contest" means the contest of an item if: (i)
the item is diligently contested in good faith by
appropriate proceedings timely instituted, GAAP Reserves are
established and maintained to the extent required by GAAP
with respect to the contested item and, during the period of
such contest, the enforcement of any contested item is
effectively stayed; or (ii) the failure to pay or comply
with the contested item during the period of such contest
could not reasonably be expected to result in a Material
Adverse Change.
"Government Rule" shall mean any statute, law, regulation,
ordinance, rule, judgment, order, decree, permit,
concession, grant, franchise, code, license, directive,
guideline, policy or rule of common law, requirement of, or
other governmental restriction or any judicial or
administrative interpretation thereof by a Governmental
Authority, including any judicial or administrative order,
consent decree or judgment or similar form of decision of or
determination by, or any interpretation or administration of
any of the foregoing by, any Governmental Authority, whether
now or hereafter in effect.
"Guaranty" by any Person shall mean any guaranty, surety,
note or other obligation, contingent or otherwise, of such
Person directly or indirectly guaranteeing in any manner any
Debt or other obligation of any other Person and, without
limiting the generality of the foregoing, any obligation,
direct or indirect, contingent or otherwise, of such Person:
(i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation
(whether arising by virtue of partnership arrangements, by
agreement to keep-well, to purchase assets, goods, notes or
services, to take-or-pay, or to maintain financial statement
conditions or otherwise); (ii) entered into for the purpose
of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof or to protect such
obligee against loss in respect thereof (in whole or in
part); or (iii) to reimburse any Person for the payment by
such Person under any letter of credit, surety, note or
other guaranty issued for the benefit of such other Person,
but excluding (x) endorsements for collection or deposit in
the ordinary course of business or (y) indemnity or hold
harmless provisions included in contracts entered into in
the ordinary course of business. The term "Guaranty" or
"Guaranteed" used as a verb shall have a correlative
meaning.
"Highest Lawful Rate" shall mean the lesser of 15% per annum
and the maximum nonusurious interest rate, if any, that at
any time or from time to time may be contracted for, taken,
reserved, charged or received on any Note or on other
Indebtedness, as the case may be, under the law of the
State of New York (or the law of any other jurisdiction
whose laws may be mandatorily applicable notwithstanding
other provisions of this Agreement), or law of the United
States of America applicable to PIC and the Transactions
which would permit PIC to contract for, charge, take,
reserve or receive a greater amount of interest than under
New York (or such other jurisdiction's) law.
"Indebtedness" shall mean any and all amounts owing or to be
owing by the Borrower to PIC in connection with the Notes or
any Security Instruments, including this Agreement.
"Lien" shall mean any mortgage, pledge, security interest,
hypothecation, collateral assignment, lien (statutory or
other), or preference, priority or other security agreement
or payment arrangement or encumbrance of any kind or nature
whatsoever which has the practical effect of constituting a
security interest (including, without limitation, any
conditional sale or other title retention agreement, any
financing lease having substantially the same economic
effect as any of the foregoing, and the filing of any
financing statement or similar instrument under the Uniform
Commercial Code of the State of New York or comparable law
of any jurisdiction, domestic or foreign).
"Loan or Loans" shall mean any loan or loans made by PIC to
the Borrower pursuant to the terms of this Agreement and
evidenced by the Notes.
"Material Adverse Change" shall mean (i) a material adverse
change in the business, results of operations, condition
(financial or otherwise) or property of the Borrower, in
each case to the extent that such change could be reasonably
expected to have a material adverse effect on the Borrower
or the Borrower's ability to make payment on the Notes or
(ii) any event or occurrence of whatever nature, which in
any case has a material adverse effect on the ability of the
Borrower individually or of the Borrower on a consolidated
basis to carry out its business as at the date of this
Agreement or as proposed at the date of this Agreement to be
conducted or meet its obligations under the Notes, this
Agreement or the other Security Instruments on a timely
basis.
"Notes" shall mean the promissory note or notes (whether one
or more) of the Borrower described in Section 2.01 and being
respectively in the form of note attached as Exhibit A,
together with any and all renewals, extensions for any
period, increases or rearrangements thereof.
"Person" shall mean any individual, corporation,
partnership, joint venture, association, joint stock
company, trust, unincorporated organization, government or
any agency or political subdivision thereof, or any other
form of entity.
"Property" shall mean any interest in any kind of property
or asset, whether real, personal or mixed, or tangible or
intangible.
"Security Instruments" shall mean this Agreement, the
agreements or instruments described or referred to in
Section 7.01(c) and any and all other agreements or
instruments now or hereafter executed and delivered by the
Borrower or any other Person in connection with, or as
security for the payment or performance of, the Loans, the
Notes or this Agreement, as such agreements may be amended
or supplemented from time to time.
"Subsidiary" shall mean, in respect of any Person, a
corporation, partnership, limited liability company or other
entity, (i) at least a 50% (direct or indirect) ownership or
equivalent interest of the outstanding Voting Stock of which
are owned, directly or indirectly, by such Person or (ii)
(a) at least a 25% (direct or indirect) ownership or
equivalent interest of the outstanding Voting Stock are
owned, directly or indirectly, by such Person and (b) such
Person exercises a controlling influence over the management
and policies with respect to such corporation, partnership,
limited liability company or other entity, directly or
indirectly, whether through the ownership of Voting Stock,
by contract or otherwise, provided that no other entity has
greater control than such Person over the management and
policies of such corporation, partnership, limited liability
company or other entity.
"Transactions" shall mean the transactions provided for in
and contemplated by this Agreement, the other Security
Instruments and the Notes.
"Voting Stock" shall mean (i) all capital stock of a
corporation normally entitled to vote in the election of
directors or other governing body of such corporation
(without regard to any contingency, whether or not such
contingency has occurred) and (ii) in respect of a
partnership or other entity that is not a corporation, all
ownership interests therein normally entitled to vote in the
election of persons analogous to directors or, if there are
no analogous persons, then normally entitled to participate
in the direction of the management of such entity (without
regard to any contingency, whether or not such contingency
has occurred).
Section 1.03 Accounting Principles. Where the character or
amount of any asset or liability or item of income or expense is
required to be determined or any consolidation or other account
ing computation is required to be made for the purposes of this
Agreement, this shall be done in accordance with GAAP applied on
a basis consistent, except where such principles are inconsistent
with the requirements of this Agreement.
ARTICLE 2
AMOUNT AND TERMS OF LOAN
Section 2.01 Loans and Notes. Subject to the terms and
conditions and relying on the representations and warranties
contained in this Agreement, PIC agrees to make from time to time
Loans to the Borrower out of the proceeds of the Initial PIC Loan
and Additional PIC Loans. Each Loan made by PIC to the Borrower
hereunder shall be evidenced by the Borrower's issuance,
execution and delivery of a Note dated the date of such Loan and
in the form set forth as Exhibit A attached hereto. The payment
terms of each Note shall provide for payments of interest and
principal upon the same terms as the PIC Loan providing the
proceeds for such Loan and in such amounts necessary to reflect
the pro rata portion that such Loan constitutes of the
applicable PIC Loan. The terms of each Loan shall provide for
payments sufficient to allow PIC to make payments of interest and
principal due and owing on the applicable PIC Note to Panda
Funding. It is the intent of PIC and the Borrower that payments
made with respect to any Note issued and delivered hereunder
shall be ultimately used to retire the indebtedness evidenced by
the corresponding Series of Bonds issued by Panda Funding under
the Indenture.
Section 2.02 Interest Rate. The Notes shall bear interest
from the date thereof until maturity at the rate set forth in such
Notes (but in no event to exceed the Highest Lawful Rate).
Section 2.03 Computation. All payments of interest shall be
computed on the per annum basis of a year of 365 or 366 days, as
the case may be, and for the actual number of days (including the
first day but excluding the last day) elapsed.
Section 2.04 Prepayments; Redemptions. The Borrower shall not
be permitted to prepay the principal amount of the Notes out
standing hereunder at any time in whole or in part, except that
the Borrower shall: (a) make mandatory prepayments on the Notes
outstanding hereunder to correspond with any mandatory
prepayments required to be made by PIC on the applicable Initial
PIC Loan or Additional PIC Loans pursuant to the PIC Loan
Agreement and (b) on the first Business Day of each month, pay to
PIC an amount equal to the lesser of (i) the amount on deposit in
the International Project Account, as defined in the Indenture,
and (ii) the amount of principal due and payable on any
outstanding Note (including accrued interest thereon and any past
due amounts) on the payment date for regularly scheduled
installments of principal or interest thereon next following the
day immediately preceding such monthly prepayment date
immediately the first Business Day of such month. With respect
to prepayments made pursuant to Section 2.04(b), the Borrower
shall pay to PIC on the regularly scheduled payment date for
payments of principal and interest on the applicable Notes a
prepayment premium in an amount equal to the difference between
the amount of interest that would have accrued on such Notes
during such period if such prepayments had not been made and the
actual amount of interest paid as a component of such
prepayments.
In addition, upon the occurrence of an Event of Default as
defined in the Indenture, PIC shall have the right, but not the
obligation, to require that the Borrower make a redemption of the
outstanding principal balance of the Notes, plus all accrued
interest thereon, upon Borrower's receipt of written notice from
PIC electing such right of redemption.
Section 2.05 Payment Procedure. All payments and prepayments
made by the Borrower under the Notes or this Agreement shall be
made by making, or causing to be made, such transfers of sums on
deposit in the International Project Account in the manner set
forth in, and as required by, Section 4.2 of the Indenture.
After all of the Bonds of any Series have been retired and all
interest and applicable premiums, if any, due thereon have been
paid or provision for such retirement and payment has been made,
and all compensation and expenses of the Trustee, the Collateral
Agent (as defined in the Indenture) and any Paying Agent (as
defined in the Indenture) have been paid or provision for such
payment has been made, any excess moneys remaining in the
International Accounts and Funds shall forthwith be paid by the
Trustee to PIC in the manner prescribed by the last sentence of
Section 6.1 of the Indenture.
Section 2.06 Business Days. If the date for any payment or
prepayment with respect to any Note or this Agreement falls on a
day which is not a Business Day, then for all purposes of the
Notes and this Agreement the same shall be deemed to have fallen
on the immediately preceding Business Day.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
In order to induce PIC to enter into this Agreement, the Borrower
represents and warrants to PIC (which representations and
warranties will survive the delivery of the Notes and the making
of the Loans thereunder) that:
Section 3.01 Corporate Existence. The Borrower is an exempted
company duly organized and validly existing under the laws of the
Cayman Islands. The Borrower has full power, authority and legal
right to enter into this Agreement and perform hereunder. The
Borrower is duly qualified as a foreign corporation in all
jurisdictions wherein the Property owned or the business
transacted by it makes such qualification necessary.
Section 3.02 Corporate Power and Authorization. The Borrower
is duly authorized and empowered to create and issue the Notes;
and the Borrower is duly authorized and empowered to execute,
deliver and perform the Security Instruments, including this
Agreement, to which it is a party; and all corporate action on
the Borrower's part requisite for the due creation and issuance
of the Notes and for the due execution, delivery and performance
of the Security Instruments, including this Agreement, to which
the Borrower is a party has been duly and effectively taken.
Section 3.03 Binding Obligations. This Agreement does, and
the Notes and other Security Instruments to which the Borrower is
a party upon their creation, issuance, execution and delivery will,
constitute the legal, valid and binding obligation of the
Borrower enforceable against the Borrower in accordance with its
terms except as enforceability may be limited by applicable
bankruptcy, insolvency, moratorium or other similar laws
affecting creditor's rights generally and except as
enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity).
Section 3.04 No Consent; Legal Bar or Resultant Lien.
No authorization, consent, approval or other action by, and no
notice to or filing with, any Governmental Authority or
regulatory body is required that has not been obtained for the
due execution, delivery and performance by the Borrower of this
Agreement, the Notes, and the Security Instruments.
The execution, delivery and performance of this Agreement,
the Notes and the Security Instruments will not (i) require any
consent or approval of the Board of Directors or stockholders of
the Borrower that has not been obtained; (ii) violate the
provisions of the Borrower's Memorandum of Association or
Articles of Association; (iii) violate the provisions of any law
(including, without limitation, any usury law), regulation or
order of any Governmental Authority applicable to the Borrower;
(iv) conflict with, result in a breach or constitute a default
under any agreement relating to the management or affairs of the
Borrower, or any indenture or loan or credit agreement or any
other material agreement, lease or instrument to which the
Borrower is a party or by which the Borrower or any of their
material properties may be bound; or (v) result in or create any
Lien (other than Excepted Liens) under, or require any consent
under, any indenture or loan or credit agreement or any other
material agreement, instrument or award of any Governmental
Authority binding upon the Borrower or any of its properties.
Section 3.05 Titles, etc. The Borrower has good title to
its (individually or in the aggregate) Properties, free and clear
of all Liens except (i) Liens and minor irregularities in title
which do not materially interfere with the occupation, use and
enjoyment by the Borrower of any of its Properties in the normal
course of business as presently conducted or materially impair
the value thereof for such business, or (ii) Excepted Liens and
Liens otherwise permitted or contemplated by this Agreement or
the other Security Instruments.
Section 3.06 Defaults. The Borrower is not in default nor
has any event or circumstance occurred which, but for the passage
of time or the giving of notice, or both, would constitute a default
(in any respect which would have a Material Adverse Change) under
any loan or credit agreement, indenture, mortgage, deed of trust,
security agreement or other agreement or instrument evidencing or
pertaining to any Debt of the Borrower, or under any material
agreement or other instrument to which the Borrower is a party or
by which the Borrower is bound. No Default hereunder has
occurred and is continuing.
Section 3.07 Use of Proceeds. The Borrower will use
the proceeds of the Loans and Notes to make loan or contribute equity
to non-U.S. electric generation projects (including businesses
substantially related thereto, such as a steam host affiliated
therewith), to pay expenses of the Borrower and, to the extent
that proceeds are thereafter available, to make loans to non-U.S.
Affiliates (as defined in the Indenture) of Panda Energy
International, Inc. for use in non-U.S. electric generation
projects (including businesses substantially related thereto,
such as a steam host affiliated therewith).
Section 3.08 Compliance with Law. The Borrower:
(a) is not in violation of any Government Rule; or
(b) has not failed to obtain any license, permit, franchise
or other governmental authorization necessary to the
ownership of any of its Properties or the conduct of its
business;
which violation or failure would have (in the event such
violation or failure were asserted by any Person through
appropriate action) a Material Adverse Change.
ARTICLE 4
AFFIRMATIVE COVENANTS
The Borrower will at all times comply with the covenants
contained in this Article 4, from the date hereof and for so long
as any part of the Indebtedness is outstanding.
Section 4.01 Maintenance. The Borrower will (i) maintain
its legal existence, rights and franchises; (ii) observe and comply
with all Government Rules; and (iii) maintain its Properties (and
any Properties leased by or consigned to it or held under title
retention or conditional sales contracts) in good and workable
condition at all times and make all repairs, replacements,
additions, betterments and improvements to its Properties as are
needful and proper so that the business carried on in connection
therewith may be conducted properly and efficiently at all times.
Section 4.02 Further Assurances. The Borrower will cure
promptly any defects in the creation and issuance of the Notes
and the execution and delivery of the Security Instruments,
including this Agreement. The Borrower will promptly execute and
deliver to PIC, or its successor or assigns, upon request all
such other and further documents, agreements and instruments (or
cause any of its Subsidiaries to take such action) in compliance
with or accomplishment of the covenants and agreements of the
Borrower in the Security Instruments, including this Agreement,
or to further evidence and more fully describe the collateral
intended as security for the Notes, or to correct any omissions
in the Security Instruments, or more fully to state the security
obligations set out herein or in any of the Security Instruments,
or to perfect, protect or preserve any Liens created pursuant to
any of the Security Instruments, or to make any recordings, to
file any notices, or obtain any consents, all as may be necessary
or appropriate in connection therewith.
Section 4.03 Performance of Obligations. The Borrower will
pay the Notes according to the reading, tenor and effect thereof
(subject to Section 6.01 hereof); and the Borrower will do and
perform every act and discharge all of the obligations provided
to be performed and discharged by the Borrower under the Security
Instruments, including this Agreement, at the time or times and
in the manner specified.
Section 4.04 Reimbursement of Expenses. The Borrower will,
upon request, promptly reimburse PIC or the holder of the Notes
for all amounts expended, advanced or incurred by PIC or such
holder to satisfy any obligation of the Borrower under this
Agreement or any other Security Instrument, or to collect the
Notes, or to enforce the rights of PIC under this Agreement or
any other Security Instrument, which amounts will include all
court costs, attorneys' fees (including, without limitation, for
trial, appeal or other proceedings), fees of auditors and
accountants, and investigation expenses reasonably incurred by
the PIC or such holder in connection with any such matters.
ARTICLE 5
NEGATIVE COVENANT
From the date hereof and for so long as any part of the
Indebtedness is outstanding, the Borrower will not permit the
proceeds of the Notes to be used for any purpose other than those
permitted by Section 3.07.
ARTICLE 6
EVENTS OF DEFAULT
Section 6.01 Events. It shall constitute an Event of Default
under this Agreement if default is made in the payment or
prepayment when due of any installment of principal or interest
on the Notes or of any fee provided for herein or other
Indebtedness; provided, however, that any failure to make
payments or prepayments when due as required by this Agreement
(other than redemptions pursuant to the last sentence of Section
2.04) shall not be an Event of Default hereunder if there are no
funds on deposit in the International Project Account as of such
date (as defined in the Indenture).
Section 6.02 Remedies. Upon the occurrence and at any time
during the continuance of any other Event of Default specified in
Section 6.01, PIC may by written notice to the Borrower
(i) declare the entire principal amount of all Indebtedness then
outstanding together with interest then accrued thereon to be
immediately due and payable without presentment, demand, notice
of intent to accelerate, notice of acceleration, protest, notice
of protest or dishonor or other notice of default of any kind,
all of which are hereby expressly waived by the Borrower, and/or
(ii) terminate the lending obligations, if any, of PIC hereunder.
Section 6.03 Right of Set-off. Upon the occurrence and during
the continuance of any Event of Default, or if the Borrower
becomes insolvent, however evidenced, PIC is hereby authorized at
any time and from time to time, without notice to the Borrower
(any such notice being expressly waived by the Borrower), to set-
off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other indebted
ness at any time owing by PIC to or for the credit or the account
of the Borrower against any and all of the Indebtedness of the
Borrower, irrespective of whether or not PIC shall have made any
demand under this Agreement or the Notes and although such
obligations may be unmatured. PIC agrees promptly to notify the
Borrower after any such set-off and application, provided that
the failure to give such notice shall not affect the validity of
such set-off and application. The rights of PIC under this
Section are in addition to other rights and remedies (including,
without limitation, other rights of set-off) which PIC may have.
ARTICLE 7
CONDITIONS OF LENDING
The obligations of PIC to make the Loans pursuant to this
Agreement are subject to the conditions precedent stated in this
Article 7.
Section 7.01 Loans. The obligation of PIC to make the Loans
under this Agreement is subject to the following conditions
precedent wherein each document to be delivered to PIC shall be
in form and substance satisfactory to it:
(a) Notes - the Borrower shall have duly and validly
issued, executed and delivered the applicable Note to PIC
evidencing the Debt of such Loan;
(b) Secretary's Certificate - PIC shall have received a certificate
of the Secretary or Assistant Secretary of the Borrower setting
forth resolutions of its board of directors with respect to the
authorization of such Note, this Agreement and any other Security
Instruments provided herein and the officers of the Borrower
authorized to sign such instruments, and specimen signatures of
the officers so authorized;
(c) No Event of Default - the fact that immediately after
such Loan, no Event of Default shall have occurred and be
continuing;
(d) Representations and Warranties - the fact that the representations
and warranties of the Borrower contained in this Agreement or any
other Security Instrument (other than those representations and
warranties which are by their terms limited to the date of the
agreement in which they are initially made) are true and correct
in all material respects on and as of the date of such loan; and
(e) Proceeds of PIC Loans - PIC shall have received the
proceeds of each applicable PIC Loan from Panda Funding
constituting the proceeds of a Series of Bonds relating to
the Loan or Loans made hereunder.
Each borrowing hereunder shall be deemed to be a representation
and warranty by the Borrower on the date of such borrowing as to
the facts specified in Subsections (c) and (d) of this Section.
ARTICLE 8
MISCELLANEOUS
Section 8.01 Notices. Any notice required or permitted to
be given under or in connection with this Agreement, the other
Security Instruments (except as may otherwise be expressly
required therein) or the Notes shall be in accordance with the
terms of Section 1.5 of the Indenture; provided, however, that
the address for the Borrower for such purpose shall be its
address shown at the beginning of this Agreement, or to such
other address or to such individual's or department's attention
as it may have furnished PIC in writing.
Section 8.02 Amendments and Waivers. Any provision of
this Agreement, the other Security Instruments or the Notes may
be amended or waived if, but only if, such amendment or waiver is in
writing and is signed by the Borrower and PIC.
Section 8.03 Invalidity. In the event that any one or more
of the provisions contained in the Notes, this Agreement or in any
other Security Instrument shall, for any reason, be held invalid,
illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other
provision of the Notes, this Agreement or any other Security
Instrument.
Section 8.04 Survival of Agreements. All representations
and warranties of the Borrower herein or in the other Security
Instruments, and all covenants and agreements herein not fully
performed before the effective date or dates of this Agreement
and of the other Security Instruments, shall survive such date or
dates.
Section 8.05 Successors and Assigns. All covenants and
agreements contained by or on behalf of the Borrower in the
Notes, this Agreement and any other Security Instrument shall
bind its successors and assigns and shall inure to the benefit of
PIC and its successors and assigns.
Section 8.06 Renewal, Extension or Rearrangement. All
provisions of this Agreement and of any other Security
Instruments relating to the Notes or other Indebtedness shall
apply with equal force and effect to each and all promissory
notes hereinafter executed which in whole or in part represent a
renewal, extension for any period, increase or rearrangement of
any part of the Indebtedness originally represented by the Notes
or of any part of such other Indebtedness.
Section 8.07 Cumulative Rights. Rights and remedie of PIC
under the Notes, this Agreement and each other Security
Instrument shall be cumulative, and the exercise or partial
exercise of any such right or remedy shall not preclude the
exercise of any other right or remedy.
Section 8.08 Singular and Plural. Words used herein in
the singular, where the context so permits, shall be deemed
to include the plural and vice versa. The definitions of words
in the singular herein shall apply to such words when used in the
plural where the context so permits and vice versa.
Section 8.09 Construction. This Agreement is, and each of
the Notes will be, a contract made under and shall be construed
in accordance with and governed by the laws of the United States
of America and the State of New York, as such laws are now in effect
and, with respect to usury laws, if any, applicable to PIC and to
the extent allowed thereby, as such laws may hereafter be in
effect which allow a higher maximum nonusurious interest rate
than such laws now allow.
Section 8.10 Interest. It is the intention of the parties
hereto to conform strictly to usury laws applicable to PIC and
the Transactions. Accordingly, if the Transactions would be
usurious under applicable law, then, notwithstanding anything to
the contrary in the Notes, this Agreement or in any other
Security Instrument or agreement entered into in connection with
the Transactions or as security for the Notes, it is agreed as
follows: (i) the aggregate of all consideration which consti
tutes interest under applicable law that is contracted for,
taken, reserved, charged or received under the Notes, this
Agreement or under any of such other Security Instruments or
agreements or otherwise in connection with the Transactions shall
under no circumstances exceed the maximum amount allowed by such
applicable law, (ii) in the event that the maturity of any Note
is accelerated for any reason, or in the event of any required or
permitted prepayment, then such consideration that constitutes
interest under applicable law may never include more than the
maximum amount allowed by such applicable law, and (iii) excess
interest, if any, provided for in this Agreement or otherwise in
connection with the Transactions shall be cancelled automatically
and, if theretofore paid, shall be credited by PIC on the
principal amount of the Indebtedness (or, to the extent that the
principal amount of the Indebtedness shall have been or would
thereby be paid in full, refunded by PIC to the Borrower to the
extent that PIC has received such payments from the Trustee under
the terms of the Indenture). The right to accelerate the
maturity of the Notes does not include the right to accelerate
any interest which has not otherwise accrued on the date of such
acceleration, and PIC does not intend to collect any unearned
interest in the event of acceleration. All sums paid or agreed
to be paid to PIC for the use, forbearance or detention of sums
included in the Indebtedness shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread
throughout the full term of the Notes until payment in full so
that the rate or amount of interest on account of the
Indebtedness does not exceed the applicable usury ceiling, if
any. As used in this Section 8.10, the term "applicable law"
shall mean the law of the State of New York (or the law of any
other jurisdiction whose laws may be mandatorily applicable
notwithstanding other provisions of this Agreement), or law of
the United States of America applicable to PIC and the
Transactions which would permit PIC to contract for, charge,
take, reserve or receive a greater amount of interest than under
New York (or such other jurisdiction's) law.
Section 8.11 Entire Agreement. The Notes, this Agreement
and the Security Instrument referred to in Section 7.01(c) embody
the entire agreement and understanding between PIC and the Borrower
and supersede all prior agreements and understandings between
such parties relating to the subject matter hereof and thereof.
Section 8.12 Exhibits. The exhibits attached to this Agreement
are incorporated herein and shall be considered a part of this
Agreement for the purposes stated herein, except that in the
event of any conflict between any of the provisions of such
exhibits and the provisions of this Agreement, the provisions of
this Agreement shall prevail.
Section 8.13 Titles of Articles, Sections and Subsections.
All titles or headings to articles, sections, subsections or other
divisions of this Agreement or the exhibits hereto are only for
the convenience of the parties and shall not be construed to have
any effect or meaning with respect to the other content of such
articles, sections, subsections or other divisions, such other
content being controlling as to the agreement between the parties
hereto.
Section 8.14 Counterparts. This Agreement may be executed
in two or more counterparts, and it shall not be necessary that the
signatures of all parties hereto be contained on any one counter
part hereof; each counterpart shall be deemed an original, but
all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be duly executed as of the date first above
written.
BORROWER: PANDA CAYMAN INTERFUNDING COMPANY
By /S/
Name: Xxxxxxx X. Xxxxxxxx
Title:Vice President
LENDER: PANDA INTERFUNDING CORPORATION
By /s/
Name: Xxxxxxx X. Xxxxxxxx
Title:Vice President
Exhibit A
FORM OF NOTE
$___________________ [Date of Issuance]
FOR VALUE RECEIVED, PANDA CAYMAN INTERFUNDING CORPORATION, a
Cayman Islands exempted company (the "Borrower"), does hereby
promise to pay to the order of the PANDA INTERFUNDING CORPORATION
(hereinafter called the "PIC") at the principal corporate trust
office of BANKERS TRUST COMPANY, as trustee, a New York banking
corporation (hereinafter called the "Trustee"), or any successor
trustee acting as such under that certain Trust Indenture (the
"Indenture") dated as of July 31, 1996, among Panda Funding
Corporation, PIC and the Trustee in lawful money of the United
States of America, the principal sum of
____________________________ DOLLARS ($____________), and to pay
interest on the unpaid principal amount hereof, in like money, at
such office at the following rate [insert terms of interest
payment to correspond to the terms contained in the applicable
PIC Note] all as required in Article 2 of the Loan Agreement
hereinafter referenced.
ALL SUMS paid hereon shall be applied first to the satisfaction
of accrued interest and the balance to the unpaid principal.
Principal on this Note is due and payable on [insert terms of
payment for principal to correspond to the terms contained in the
applicable PIC Note] all as required in Article 2 of the Loan
Agreement.
THIS NOTE is a Note referred to the Loan Agreement dated as of
July 31, 1996 by and between the Borrower and PIC (the "Loan
Agreement"), and is subject to, and is executed in accordance
with, all of the terms, conditions and provisions thereof,
including those respecting prepayment and the acceleration of
maturity and is further subject to all of the terms, conditions
and provisions of the Indenture, all as provided in the Loan
Agreement. Capitalized terms used and not otherwise defined in
this Note shall have the meanings given to such terms in the Loan
Agreement.
Page 1 of 2 Pages
THIS NOTE is a contract made under and shall be construed in
accordance with and governed by the laws of the State of New
York.
PANDA CAYMAN INTERFUNDING
COMPANY
By:_____________________________________
Name:
Title:
