Exhibit 10.7





Exhibit 10.7




Execution Version




AMENDED AND RESTATED SENIOR SECURED REVOLVING CREDIT AGREEMENT




dated as of March 30, 2010




among




KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY

as Borrower




THE LENDERS FROM TIME TO TIME PARTY HERETO




and




SUNTRUST BANK

as Administrative Agent




CITIBANK, NA

as Syndication Agent




UBS SECURITIES LLC

as Documentation Agent




 





SUNTRUST ROBINSON HUMPHREY, INC.

as Arranger and Book Manager






 


 









 







TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	ARTICLE I DEFINITIONS; CONSTRUCTION
	 	 	1	 
	 
	 	 	 	 
	Section 1.1. Definitions
	 	 	1	 
	Section 1.2. Classifications of Loans and Borrowings
	 	 	25	 
	Section 1.3. Accounting Terms and Determination
	 	 	25	 
	Section 1.4. Terms Generally
	 	 	26	 
	 
	 	 	 	 
	ARTICLE II AMOUNT AND TERMS OF THE COMMITMENTS
	 	 	26	 
	 
	 	 	 	 
	Section 2.1. General Description of Facilities
	 	 	26	 
	Section 2.2. Revolving Loans
	 	 	26	 
	Section 2.3. Procedure for Borrowings
	 	 	26	 
	Section 2.4. Swingline Commitment
	 	 	27	 
	Section 2.5. Funding of Borrowings
	 	 	28	 
	Section 2.6. Interest Elections
	 	 	29	 
	Section 2.7. Optional Reduction and Termination of Commitments
	 	 	30	 
	Section 2.8. Repayment of Loans
	 	 	30	 
	Section 2.9. Evidence of Indebtedness
	 	 	30	 
	Section 2.10. Prepayments
	 	 	31	 
	Section 2.11. Interest on Loans
	 	 	32	 
	Section 2.12. Fees
	 	 	32	 
	Section 2.13. Computation of Interest and Fees
	 	 	33	 
	Section 2.14. Inability to Determine Interest Rates
	 	 	33	 
	Section 2.15. Illegality
	 	 	34	 
	Section 2.16. Increased Costs
	 	 	34	 
	Section 2.17. Funding Indemnity
	 	 	35	 
	Section 2.18. Taxes
	 	 	35	 
	Section 2.19. Payments Generally; Pro Rata Treatment; Sharing of Set-offs
	 	 	36	 
	Section 2.20. Increase of Commitments; Additional Lenders
	 	 	38	 
	Section 2.21. Mitigation of Obligations
	 	 	39	 
	Section 2.22. Replacement of Lenders
	 	 	39	 
	Section 2.23. Reallocation and Cash Collateralization of Defaulting Lender
or Potential Defaulting Lender Commitment
	 	 	40	 
	 
	 	 	 	 
	ARTICLE III CONDITIONS PRECEDENT TO LOANS
	 	 	41	 
	 
	 	 	 	 
	Section 3.1. Conditions To Effectiveness
	 	 	41	 
	Section 3.2. Each Credit Event
	 	 	43	 
	Section 3.3. Delivery of Documents
	 	 	45	 
	 
	 	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES
	 	 	45	 
	 
	 	 	 	 
	Section 4.1. Existence; Power
	 	 	45	 
	Section 4.2. Organizational Power; Authorization
	 	 	45	 
	Section 4.3. Governmental Approvals; No Conflicts
	 	 	45	 
	Section 4.4. Financial Statements
	 	 	45	 
	Section 4.5. Litigation and Environmental Matters
	 	 	46	 
	Section 4.6. Compliance with Laws and Agreements
	 	 	46	 
	Section 4.7. Investment Company Act, Etc.
	 	 	46	 
	Section 4.8. Taxes
	 	 	46	 
	 
	 	 	 	 






 


 









 





	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	Section 4.9. Margin Regulations
	 	 	46	 
	Section 4.10. Investment Objectives
	 	 	47	 
	Section 4.11. ERISA
	 	 	47	 
	Section 4.12. Ownership of Property
	 	 	47	 
	Section 4.13. Disclosure
	 	 	47	 
	Section 4.14. Labor Relations
	 	 	48	 
	Section 4.15. Subsidiaries
	 	 	48	 
	Section 4.16. Solvency
	 	 	48	 
	Section 4.17. OFAC
	 	 	48	 
	Section 4.18. Patriot Act
	 	 	48	 
	 
	 	 	 	 
	ARTICLE V AFFIRMATIVE COVENANTS
	 	 	48	 
	 
	 	 	 	 
	Section 5.1. Financial Statements and Other Information
	 	 	48	 
	Section 5.2. Notices of Material Events
	 	 	50	 
	Section 5.3. Existence; Conduct of Business
	 	 	51	 
	Section 5.4. Compliance with Laws, Etc.
	 	 	51	 
	Section 5.5. Payment of Obligations
	 	 	51	 
	Section 5.6. Books and Records
	 	 	51	 
	Section 5.7. Visitation, Inspection, Etc.
	 	 	51	 
	Section 5.8. Maintenance of Properties; Insurance
	 	 	52	 
	Section 5.9. Use of Proceeds
	 	 	52	 
	Section 5.10. Additional Subsidiaries; Additional Collateral
	 	 	52	 
	Section 5.11. Portfolio Valuation and Diversifications, Etc.
	 	 	52	 
	Section 5.12. Calculation of Borrowing Base
	 	 	54	 
	Section 5.13. Compliance with Investment Objectives
	 	 	55	 
	 
	 	 	 	 
	ARTICLE VI FINANCIAL COVENANTS
	 	 	55	 
	 
	 	 	 	 
	Section 6.1. Minimum Asset Coverage Ratio
	 	 	55	 
	Section 6.2. Minimum Liquidity
	 	 	55	 
	Section 6.3. Minimum Consolidated Shareholders Equity
	 	 	55	 
	 
	 	 	 	 
	ARTICLE VII NEGATIVE COVENANTS
	 	 	56	 
	 
	 	 	 	 
	Section 7.1. Indebtedness and Preferred Equity
	 	 	56	 
	Section 7.2. Negative Pledge
	 	 	56	 
	Section 7.3. Fundamental Changes
	 	 	57	 
	Section 7.4. Restricted Payments
	 	 	57	 
	Section 7.5. Sale of Assets
	 	 	59	 
	Section 7.6. Transactions with Affiliates
	 	 	59	 
	Section 7.7. Restrictive Agreements
	 	 	59	 
	Section 7.8. Sale and Leaseback Transactions
	 	 	60	 
	Section 7.9. Hedging Transactions
	 	 	60	 
	Section 7.10. Accounting Changes
	 	 	60	 
	Section 7.11. Amendment to Material Documents
	 	 	60	 
	Section 7.12. Loans, Etc.
	 	 	60	 
	Section 7.13. Deposit Accounts; Other Accounts
	 	 	61	 
	Section 7.14. Government Regulation
	 	 	61	 
	 
	 	 	 	 
	ARTICLE VIII EVENTS OF DEFAULT
	 	 	61	 
	 
	 	 	 	 
	Section 8.1. Events of Default
	 	 	61	 
	 
	 	 	 	 
	ARTICLE IX THE ADMINISTRATIVE AGENT
	 	 	64	 
	 
	 	 	 	 






 


ii









 





	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	Section 9.1. Appointment of Administrative Agent
	 	 	64	 
	Section 9.2. Nature of Duties of Administrative Agent
	 	 	64	 
	Section 9.3. Lack of Reliance on the Administrative Agent
	 	 	64	 
	Section 9.4. Certain Rights of the Administrative Agent
	 	 	65	 
	Section 9.5. Reliance by Administrative Agent
	 	 	65	 
	Section 9.6. The Administrative Agent in its Individual Capacity
	 	 	65	 
	Section 9.7. Successor Administrative Agent
	 	 	65	 
	Section 9.8. Withholding Tax
	 	 	66	 
	Section 9.9. Administrative Agent May File Proofs of Claim
	 	 	66	 
	Section 9.10. Authorization to Execute other Loan Documents
	 	 	67	 
	Section 9.11. Syndication Agent and Documentation Agent
	 	 	67	 
	Section 9.12. Approved Third Party Appraiser Release
	 	 	67	 
	 
	 	 	 	 
	ARTICLE X MISCELLANEOUS
	 	 	67	 
	 
	 	 	 	 
	Section 10.1. Notices
	 	 	67	 
	Section 10.2. Waiver; Amendments
	 	 	69	 
	Section 10.3. Expenses; Indemnification
	 	 	71	 
	Section 10.4. Successors and Assigns
	 	 	72	 
	Section 10.5. Governing Law; Jurisdiction; Consent to Service of Process
	 	 	75	 
	Section 10.6. WAIVER OF JURY TRIAL
	 	 	76	 
	Section 10.7. Right of Setoff
	 	 	76	 
	Section 10.8. Counterparts; Integration
	 	 	76	 
	Section 10.9. Survival
	 	 	76	 
	Section 10.10. Severability
	 	 	77	 
	Section 10.11. Confidentiality
	 	 	77	 
	Section 10.12. Interest Rate Limitation
	 	 	77	 
	Section 10.13. Waiver of Effect of Corporate Seal
	 	 	77	 
	Section 10.14. Patriot Act
	 	 	77	 
	Section 10.15. NO ORAL AGREEMENTS, WAIVER
	 	 	78	 
	Section 10.16. Location of Closing
	 	 	78	 
	Section 10.17. Existing Credit Agreement
	 	 	78	 
	Section 10.18. Amendment and Restatement
	 	 	78	 






 


iii









 





Schedules




	 	 	 	 	 
	 
	 	 	 	 
	Schedule I
	 	—	 	Commitment Amounts
	Schedule II
	 	—	 	Approved Dealers and Appraisers
	Schedule III
	 	—	 	Approved Brokerage Accounts
	Schedule 4.5
	 	—	 	Environmental Matters
	Schedule 4.10
	 	—	 	Investment Objective
	Schedule 4.15
	 	—	 	Subsidiaries
	Schedule 7.1
	 	—	 	Outstanding Indebtedness
	Schedule 7.2
	 	—	 	Existing Liens
	 
	 	 	 	 






Exhibits




	 	 	 	 	 
	Exhibit A
	 	—	 	Form of Assignment and Acceptance
	Exhibit B
	 	—	 	Form of Subsidiary Guaranty
	Exhibit 2.3
	 	—	 	Form of Notice of Revolving Borrowing
	Exhibit 2.4
	 	—	 	Form of Notice of Swingline Borrowing
	Exhibit 2.6(b)
	 	—	 	Form of Continuation/Conversion
	Exhibit 3.1(c)(v)
	 	—	 	Form of Secretary’s Certificate
	Exhibit 3.1(c)(viii)
	 	—	 	Form of Responsible Officer’s Certificate
	Exhibit 5.1(c)
	 	—	 	Form of Compliance Certificate
	Exhibit 5.1(e)
	 	—	 	Form of Borrowing Base Certificate
	Exhibit 7.4
	 	—	 	Form of Distributable Cash Flow Certificate
	Exhibit 9.10
	 	—	 	Form of Approved Third Party Appraiser Release






 


iv









 





AMENDED AND RESTATED SENIOR SECURED REVOLVING CREDIT AGREEMENT




THIS AMENDED AND RESTATED SENIOR SECURED REVOLVING CREDIT AGREEMENT (this “Agreement”) is made
and entered into as of March 30, 2010, by and among KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY, a
Maryland corporation (the “Borrower”), the several banks and other financial institutions from time
to time party hereto (the “Lenders”), SUNTRUST BANK, in its capacity as Administrative Agent for
the Lenders (the “Administrative Agent”) and as Swingline Lender (the “Swingline Lender”),
CITIBANK, NA, as Syndication Agent (“Syndication Agent”) and UBS SECURITIES LLC as Documentation
Agent (“Documentation Agent”).



W I T N E S S E T H:




WHEREAS, the Borrower, SunTrust Bank, as Administrative Agent, and the Lenders are parties to
that certain Senior Secured Revolving Credit Agreement dated June 4, 2007 (the “Existing Credit
Agreement”) which established $100,000,000 senior secured revolving credit facility with a
$10,000,000 letter of credit subfacility and a $10,000,000 swing line facility in favor of the
Borrower;



WHEREAS, the Borrower has requested certain amendments to the Existing Credit Agreement, and
subject to the terms and conditions contained in this Agreement, the parties hereto have agreed to
amend, restate and replace the Existing Credit Agreement in order to refinance the loans made under
the Existing Credit Agreement;



NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained,
the Borrower, the parties hereto agree that the Existing Credit Agreement is amended and restated
in its entirety as follows:



ARTICLE I




DEFINITIONS; CONSTRUCTION




Section 1.1. Definitions. In addition to the other terms defined herein, the
following terms used herein shall have the meanings herein specified (to be equally applicable to
both the singular and plural forms of the terms defined):



“Additional Commitment Amount” shall have the meaning given to such term in Section
2.20.




“Additional Lender” shall have the meaning given to such term in Section 2.20.



“Adjusted Borrowing Base” shall mean the Borrowing Base minus the aggregate amount of
Cash and Cash Equivalents included in the Collateral.



“Adjusted Revolving Credit Exposure Amount” shall mean, on any date, the aggregate principal
amount of all of the Revolving Credit Exposures of all Lenders minus the aggregate amount
of Cash and Cash Equivalents included in the Collateral.



“Adjusted LIBO Rate” shall mean, with respect to each Interest Period for a Eurodollar
Borrowing, the rate per annum obtained by dividing (i) LIBOR for such Interest Period by (ii) a
percentage equal to 1.00 minus the Eurodollar Reserve Percentage.



 


 









 





“Administrative Agent” shall have the meaning assigned to such term in the opening paragraph
hereof.



“Administrative Questionnaire” shall mean, with respect to each Lender, an administrative
questionnaire in the form prepared by the Administrative Agent and submitted to the Administrative
Agent duly completed by such Lender.



“Advance Rate” means, as to any Portfolio Investment and subject to adjustment as provided in
Section 5.12(a), (b) and (c), the following percentages with respect to
such Portfolio Investment:



	 	 	 	 	 	 	 	 	 
	Portfolio Investment	 	Quoted	 	 	Unquoted	 
	 
	 	 	 	 	 	 	 	 
	Cash, Cash Equivalents and Short-Term U.S. Government
Securities
	 	 	100	%	 	 	n.a.	 
	 
	 	 	 	 	 	 	 	 
	Long-Term U.S. Government Securities
	 	 	95	%	 	 	n.a.	 
	 
	 	 	 	 	 	 	 	 
	Performing First Lien Bank Loans
	 	 	80	%	 	 	70	%
	 
	 	 	 	 	 	 	 	 
	Performing Second Lien Bank Loans
	 	 	70	%	 	 	60	%
	 
	 	 	 	 	 	 	 	 
	Performing Unsecured Bank Loans
	 	 	65	%	 	 	55	%
	 
	 	 	 	 	 	 	 	 
	Performing Non-Cash Pay Bank Loans
	 	 	55	%	 	 	45	%
	 
	 	 	 	 	 	 	 	 
	Performing Cash Pay High Yield Securities
	 	 	60	%	 	 	50	%
	 
	 	 	 	 	 	 	 	 
	Performing Non-Cash Pay High Yield Securities
	 	 	50	%	 	 	40	%
	 
	 	 	 	 	 	 	 	 
	Performing Public MLP Common and Preferred Units
	 	 	50	%	 	 	45	%
	 
	 	 	 	 	 	 	 	 
	Performing Private MLP Common and Preferred Units
	 	 	n.a.	 	 	 	20	%
	 
	 	 	 	 	 	 	 	 
	Performing Common Equity, Warrants and MLP Subordinated Units
	 	 	45	%	 	 	40	%
	 
	 	 	 	 	 	 	 	 
	Non-Performing First Lien Bank Loans
	 	 	35	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 
	Non-Performing Second Lien Bank Loans
	 	 	25	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 
	Non-Performing High Yield Securities
	 	 	25	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 
	Non-Performing Unsecured Bank Loans
	 	 	20	%	 	 	0	%
	 
	 	 	 	 	 	 	 	 
	Non-Performing Public MLP Common and Preferred Units
	 	 	35	%	 	 	0	%






 


2









 





“Affiliate” shall mean, as to any Person, any other Person that directly, or indirectly
through one or more intermediaries, Controls, is Controlled by, or is under common Control with,
such Person. For the purposes of this definition, “Control” shall mean the power, directly or
indirectly, either
to (i) vote 5% or more of the securities having ordinary voting power for the election of
directors (or persons performing similar functions) of a Person or (ii) direct or cause the
direction of the management and policies of a Person, whether through the ability to exercise
voting power, by control or otherwise. The terms “Controlling”, “Controlled by”, and “under common
Control with” have the meanings correlative thereto.



“Aggregate Commitment Amount” shall mean the aggregate principal amount of the Revolving
Commitments from time to time. On the Closing Date, the Aggregate Commitment Amount equals
$70,000,000.



“Anti-Terrorism Order” shall mean Executive Order 13224, signed by President George W. Bush on
September 24, 2001.



“Applicable Lending Office” shall mean, for each Lender and for each Type of Loan, the
“Lending Office” of such Lender (or an Affiliate of such Lender) designated for such Type of Loan
in the Administrative Questionnaire submitted by such Lender or such other office of such Lender
(or an Affiliate of such Lender) as such Lender may from time to time specify to the Administrative
Agent and the Borrower as the office by which its Loans of such Type are to be made and maintained.



“Applicable Margin” shall mean, as of any date, with respect to all Loans outstanding on any
date, 1.00% per annum on Base Rate Loans and 2.00% per annum on LIBOR Loans, provided, that, if the
aggregate principle amount of outstanding Revolving Loans exceeds Quoted Securities Borrowing Base,
then the Applicable Margin shall mean 2.00% per annum on Base Rate Loans and 3.00% per annum on
LIBOR Loans.



“Applicable Percentage” shall mean, as of any date, with respect to the commitment fee, 0.50%
per annum.



“Approved Brokerage Accounts” shall mean the accounts set forth on Part A of Schedule III, or
such other accounts approved by the Administrative Agent, such approval not to be unreasonably
withheld.



“Approved Dealer” shall mean (a) in the case of any Portfolio Investment that is not a U.S.
Government Security, a bank or a broker-dealer registered under the Securities Exchange Act of 1934
of nationally recognized standing or an Affiliate thereof, (b) in the case of a U.S. Government
Security, any primary dealer in U.S. Government Securities, and (c) in the case of any foreign
Portfolio Investment, any foreign broker-dealer of internationally recognized standing or an
Affiliate thereof, in the case of each of clauses (a), (b) and (c) above, as set forth on Schedule
II or any other bank or broker-dealer acceptable to the Administrative Agent in its reasonable
discretion.



“Approved Fund” shall mean any Person (other than a natural Person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business and that is administered or managed by
(i) a Lender, (ii) an Affiliate of a Lender or (iii) an entity or an Affiliate of an entity that
administers or manages a Lender.



 


3









 





“Approved Pricing Service” shall mean a pricing or quotation service as set forth on Schedule
II or any other pricing or quotation service approved by the Board of Directors of Borrower and
designated in writing to the Administrative Agent (which designation shall be accompanied by a copy
of the resolutions of the Board of Directors of the Borrower that such pricing or quotation service
has been approved by the Borrower).



“Approved Third Party Appraiser” means any independent third party appraisal firm designated
by the Borrower in writing to the Administrative Agent (which designation shall be accompanied by a
copy of the resolution of the Board of Directors of the Borrower that such firm has been approved
by the Borrower for purposes for assisting the Board of Directors of the Borrower in making
valuations of portfolio assets). It is understood and agreed that, so long as the same is an
independent third party appraisal firm approved by the Board of Directors of the Borrower, Duff &
Phelps shall be deemed to be an Approved Third Party Appraiser.



“Asset Coverage Ratio” shall mean, as of any date, the ratio, determined on a consolidated
basis, without duplication, in accordance with GAAP, of (i) the value of total assets of the
Borrower and its Subsidiaries (other than deferred tax assets), less all liabilities (other than
Indebtedness, including Indebtedness under this Agreement and deferred tax liabilities) of the
Borrower and its Subsidiaries, as of such date, to (ii) the aggregate amount of Indebtedness of the
Borrower and its Subsidiaries, provided, however, for purposes of calculating the
Closed End Company Required Threshold, total assets of the Borrower and its Subsidiaries as set
forth in (i) above shall include all deferred tax assets and total liabilities of the Borrower and
its Subsidiaries as set forth in (i) above shall include all deferred tax liabilities.



“Assignment and Acceptance” shall mean an assignment and acceptance entered into by a Lender
and an assignee (with the consent of any party whose consent is required by Section
10.4(b)) and accepted by the Administrative Agent, in the form of Exhibit A attached
hereto or any other form approved by the Administrative Agent.



“Availability Period” shall mean the period from the Closing Date to but excluding the
Revolving Commitment Termination Date.



“Bank Loans” means debt obligations (including, without limitation, term loans, revolving
loans, debtor-in-possession financings, the funded and unfunded portion of revolving credit lines
and letter of credit facilities and other similar loans and investments including interim loans and
senior subordinated loans) which are generally under a syndicated loan or credit facility.



“Bank Product Amount” shall have the meaning set forth in the definition of “Bank Product
Provider”.



“Bank Product Obligations” shall mean, collectively, all obligations and other liabilities of
any Loan Party to any Bank Product Provider in respect of any of the following services (“Bank
Products”) provided to such Loan Party by such Bank Product Provider: (a) any treasury or other
cash management services, including deposit accounts, automated clearing house (ACH) origination
and other funds transfer, depository (including cash vault and check deposit), zero balance
accounts and sweeps, return items processing, controlled disbursement accounts, positive pay,
lockboxes and lockbox accounts, account reconciliation and information reporting, payables
outsourcing, payroll processing, trade finance services, investment accounts and securities
accounts, and (b) card services, including credit card (including purchasing card and commercial
card), prepaid cards, including payroll, stored value and gift cards, merchant services processing,
and debit card services.



 


4









 





“Bank Product Provider” means any Person that, at the time it provides any Bank Products to
any Loan Party, (i) is a Lender or an Affiliate of a Lender and (ii) except when the Bank Product
Provider is SunTrust Bank and its Affiliates, has provided prior written notice to the
Administrative Agent which has been acknowledged by the Borrower of (x) the existence of such Bank
Product, (y) the maximum dollar amount of obligations arising thereunder (the “Bank Product
Amount”) and (z) the methodology to be used by such parties in determining the obligations under
such Bank
Product from time to time. In no event shall any Bank Product Provider acting in such
capacity be deemed a Lender for purposes hereof to the extent of and as to Bank Products except
that each reference to the term “Lender” in Article IX and Section 10.4 shall be deemed to include
such Bank Product Provider and in no event shall the approval of any such person in its capacity as
Bank Product Provider be required in connection with the release or termination of any security
interest or Lien of the Administrative Agent. No Bank Product Amount may be established at any
time that a Default or Event of Default exists.



“Base Rate” shall mean the higher of (i) the per annum rate which the Administrative Agent
announces from time to time as its prime lending rate, as in effect from time to time, (ii) the
Federal Funds Rate, as in effect from time to time, plus one-half of one percent (1/2%) per annum or
(iii) the one month LIBOR rate, which rate shall be determined on a daily basis (any changes in
such rates to be effective as of the date of any change in such rate), plus one percent (1%) per
annum. The Administrative Agent’s prime lending rate is a reference rate and does not necessarily
represent the lowest or best rate actually charged to any customer. The Administrative Agent may
make commercial loans or other loans at rates of interest at, above, or below the Administrative
Agent’s prime lending rate. Each change in the Administrative Agent’s prime lending rate shall be
effective from and including the date such change is publicly announced as being effective.




“Borrower” shall have the meaning in the introductory paragraph hereof.



“Borrowing” shall mean a borrowing consisting of (i) Loans of the same Class and Type, made,
converted or continued on the same date and in case of Eurodollar Loans, as to which a single
Interest Period is in effect, or (ii) a Swingline Loan.



“Borrowing Availability” shall mean, at any time, (i) the Borrowing Limit less (ii) the
aggregate principal amount of the Revolving Credit Exposure of all Lenders.




“Borrowing Base” shall have the meaning assigned to such term in Section 5.12.



“Borrowing Base Certificate” shall mean a certificate of the chief financial officer or chief
executive officer of the Borrower, substantially in the form of Exhibit 5.12.



“Borrowing Base Deficiency” shall mean, at any date on which the same is determined, the
amount, if any, that (a) the aggregate principal amount of the Revolving Credit Exposure of all
Lenders as of such date exceeds (b) the Borrowing Base as of such date.



“Borrowing Limit” shall mean, at any time, the lesser of (i) the Aggregate Commitment Amount
at such time and (ii) the Borrowing Base at such time as reported in the Borrowing Base Certificate
most recently delivered to the Lenders pursuant to Section 5.1(e).



“Business Day” shall mean (i) any day other than a Saturday, Sunday or other day on which
commercial banks in Atlanta, Georgia and New York, New York are authorized or required by law to
close and (ii) if such day relates to a Borrowing of, a payment or prepayment of principal or
interest on, a conversion of or into, or an Interest Period for, a Eurodollar Loan or a notice with
respect to any of



 


5









 






the foregoing, any day on which banks are not open for dealings in Dollars are
carried on in the London interbank market.



“Capital Lease Obligations” of any Person shall mean all obligations of such Person to pay
rent or other amounts under any lease (or other arrangement conveying the right to use) of real or
personal property, or a combination thereof, which obligations are required to be classified and
accounted
for as capital leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance with GAAP.



“Capital Stock” of any Person shall mean all shares, options, warrants, general or limited
partnership interests, membership interests or other equivalents (regardless of how designated) of
or in a corporation, partnership, limited liability company or equivalent entity whether voting or
nonvoting, including common stock, Preferred Stock or any other “equity security” (as such term is
defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934).



“Cash” shall mean any immediately available funds in Dollars or in any currency other than
Dollars which is freely convertible currency.



“Cash Collateralize” shall mean, in respect of any obligations, to provide and pledge (as a
first priority perfected security interest) cash collateral for such obligations in Dollars, with
the Administrative Agent pursuant to documentation in form and substance, reasonably satisfactory
to the Administrative Agent (and “Cash Collateralization” has a corresponding meaning).



“Cash Equivalents” shall mean investments (other than Cash) that are one or more of the
following obligations:



(a) U.S. Government Securities, in each case maturing within one year from the acquisition
thereof;



(b) investments in commercial paper maturing within 270 days from the date of acquisition
thereof and having, at such acquisition date, a credit rating of at least A1 from S&P and at least
P1 from Moody’s;



(c) investments in certificates of deposit, banker’s acceptances and time deposits maturing
within 180 days from the date of acquisition thereof (i) issued or guaranteed by or placed with,
and money market deposit accounts issued or offered by, any domestic office of any commercial bank
organized under the laws of the United States or America or any State thereof; provided
that such certificates of deposit, banker’s acceptances and time deposits are held in a securities
account (as defined in the Uniform Commercial Code) through which the Administrative Agent can
perfect a security interest therein and (ii) having, at such date of acquisition, a credit rating
of at least A1 from S&P and at least P1 from Moody’s;



(d) fully collateralized repurchase agreements with a term of not more than 30 days from the
date of acquisition thereof for U.S. Government Securities and entered into with a financial
institution satisfying the criteria described in clause (c) of this definition;



provided, that (i) in no event shall Cash Equivalents include any obligation that
provides for the payment of interest alone (for example, interest-only securities or “IOs”); (ii)
if any of Moody’s or S&P changes its rating system, then any ratings included in this definition
shall be deemed to be an equivalent rating in a successor rating category of Moody’s or S&P, as the
case may be; (iii) Cash



 


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Equivalents (other than U.S. Government Securities or repurchase
agreements) shall not include any such investment of more than 10% of total assets of the Loan
Parties in any single issuer; and (iv) in no event shall Cash Equivalents include any obligation
that is not denominated in Dollars.



“Change in Control” shall mean the occurrence of one or more of the following events: (i) any
sale, lease, exchange or other transfer (in a single transaction or a series of related
transactions) of all or
substantially all of the assets of the Borrower to any Person or “group” (within the meaning of the
Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder
in effect on the date hereof), (ii) the acquisition of ownership, directly or indirectly,
beneficially or of record, by any Person or “group” (within the meaning of the Securities Exchange
Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the
date hereof) of 35% or more of the outstanding shares of the voting stock of the Borrower; (iii)
during any period of 24 consecutive months, a majority of the members of the board of directors or
other equivalent governing body of the Borrower cease to be composed of individuals (A) who were
members of that board or equivalent governing body on the first day of such period, (B) whose
election or nomination to that board or equivalent governing body was approved by individuals
referred to in clause (A) above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body, or (C) whose election or nomination to that
board or other equivalent governing body was approved by individuals referred to in clauses (A) and
(B) above constituting at the time of such election or nomination at least a majority of that board
or equivalent governing body (for the purposes of determining such majority, such majority shall
not include, in the case of both clause (B) and clause (C), any individual whose initial nomination
for, or assumption of office as, a member of that board or equivalent governing body occurs as a
result of an actual or threatened solicitation of proxies or consents for the election or removal
of one or more directors by any person or group other than a solicitation for the election of one
or more directors by or on behalf of the board of directors); or (iv) KA Fund Advisors, LLC (or an
Affiliate thereof approved by the Administrative Agent (such approval not to be unreasonably
withheld)) ceases to retain its advisory duties over the Borrower in effect on the Closing Date.



“Change in Law” shall mean (i) the adoption of any applicable law, rule or regulation after
the date of this Agreement, (ii) any change in any applicable law, rule or regulation, or any
change in the interpretation or application thereof, by any Governmental Authority after the date
of this Agreement, or (iii) compliance by any Lender (or its Applicable Lending Office) (or for
purposes of Section 2.16(b), by such Lender’s Parent Company, if applicable) with
any request, guideline or directive (whether or not having the force of law) of any Governmental
Authority made or issued after the date of this Agreement.



“Class”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the
Loans comprising such Borrowing, are Revolving Loans or Swingline Loans and when used in reference
to any Commitment, refers to whether such Commitment is a Revolving Commitment or a Swingline
Commitment.



“Clearing Accounts” shall mean the accounts set forth on Part C of Schedule III, or such other
accounts approved by the Administrative Agent, such approval not to be unreasonably withheld.



“Closed End Company Required Threshold” shall have the meaning set forth in Section
6.1.



“Closing Date” shall mean the date on which the conditions precedent set forth in Section
3.1 and Section 3.2 have been satisfied or waived in accordance with Section
10.2.



 


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“Code” shall mean the Internal Revenue Code of 1986, as amended and in effect from time to
time.



“Collateral” shall mean (i) all portfolio assets, (ii) Cash, (iii) all tangible and intangible
property, real and personal, of any Loan Party in each case that is, or is purported or required to
be, the subject of a Lien granted pursuant to a Security Document to the Administrative Agent for
the benefit of the Lenders to secure the whole or any part of the Obligations or any Guarantee
thereof, and shall include,
without limitation, all loans (including all supporting obligations and collateral therefor),
investments, cash, deferred interest, warrants, options, collections, fees, loan and investment
portfolio, accounts, inventory, equipment, general intangibles, goods, documents, contracts,
intercompany obligations, stock, securities, notes, and all proceeds of the foregoing and all
casualty insurance proceeds and condemnation awards with respect to any of the foregoing.



“Collateral Accounts” shall mean the accounts set forth on Part B of Schedule III, or such
other accounts approved by the Administrative Agent, such approval not to be unreasonably withheld.



“Commitment” shall mean a Revolving Commitment, a Swingline Commitment or any combination
thereof (as the context shall permit or require).



“Compliance Certificate” shall mean a certificate from the chief executive officer or the
chief financial officer of the Borrower in the form of, and containing the certifications set forth
in, the certificate attached hereto as Exhibit 5.1(c).



“Contractual Obligation” of any Person shall mean any provision of any security issued by such
Person or of any agreement, instrument or undertaking under which such Person is obligated or by
which it or any of the property in which it has an interest is bound.



“Control Agreement” shall mean each Control Agreement by and among the Borrower, the
Administrative Agent and the depository bank, custodian or securities intermediary at which the
account subject to such agreement is held, as amended, restated, supplemented or otherwise modified
from time to time.



“Deeds of Trust” shall mean any deeds of trust, leasehold deeds of trust, mortgages, leasehold
mortgages, deeds to secure debt, leasehold deeds to secure debt or other real estate security
documents delivered by any Loan Party to Administrative Agent from time to time, all in form and
substance satisfactory to Administrative Agent, as amended, restated, modified or otherwise
supplemented from time to time.



“Default” shall mean any condition or event that, with the giving of notice or the lapse of
time or both, would constitute an Event of Default.



“Defaulting Lender” shall mean, at any time, any Lender as to which the Administrative Agent
has notified the Borrower that (i) such Lender has failed for three or more Business Days to comply
with its obligations under this Agreement to make a Loan and/or to make a payment to the Swingline
Lender in respect of a Swingline Loan (each a “funding obligation”), (ii) such Lender has notified
the Administrative Agent, or has stated publicly, that it will not comply with any such funding
obligation hereunder, or has defaulted on, its obligation to fund generally under any other loan
agreement, credit agreement or other financing agreement, (iii) such Lender has, for three or more
Business Days, failed to confirm in writing to the Administrative Agent, in response to a written
request of the Administrative Agent, that it will comply with its funding obligations hereunder, or
(iv) a Lender



 


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Insolvency Event has occurred and is continuing with respect to such Lender. The
Administrative Agent will promptly send to all parties hereto a copy of any notice to the Borrower
provided for in this definition.



“Default Interest” shall have the meaning set forth in Section 2.11(c).



“Distributable Cash Flow” shall mean for the Borrower, for any period and without duplication,
an amount equal to the sum of (i) the Borrower’s consolidated net investment income for such
period, plus (ii) dividends with respect to Capital Stock of Kinder, Enbridge or a similar
equity investment approved by the Administrative Agent in its reasonable discretion paid in
additional shares of such capital stock during such period (“PIK Shares”) plus (iii)
imputed dividends received during such period in the form of MLP Units purchased at a discount in
privately negotiated transactions (“Imputed MLP Dividends”), plus (iv) the return of the
capital portion of dividends and distributions earned during such period, plus (v) any
income tax expense included in net investment income for such period, plus (vi) any cash
income tax refund received during such period, minus (vii) any income tax benefit included
in net investment loss for such period, minus (viii) any cash income taxes paid during such
period, in each case determined on a consolidated basis in accordance with GAAP, provided,
that in no event shall the amounts set forth in parts (ii) and (iii) above with respect to PIK
Shares and Imputed MLP Dividends for such period exceed 5% of the aggregate amount of consolidated
investment income for such period (including the return of the capital portion of dividends and
distributions earned during such period), as determined on a consolidated basis in accordance with
GAAP; provided, further, the Borrower may include one hundred percent (100%) of the cash
proceeds of any sale of PIK Shares or any Imputed MLP Dividends during such period in the
determination of Distributable Cash Flow for such period.



“Distributable Cash Flow Certificate” shall mean a certificate of the chief financial officer
or chief executive officer of the Borrower, substantially in the form of Exhibit 7.4.




“Dollar(s)” and the sign “$” shall mean lawful money of the United States of America.



“Eligible Assignee” shall mean (i) a Lender; (ii) an Affiliate of a Lender; (iii) an Approved
Fund; and (iv) any other Person (other than a natural Person) approved by the Administrative Agent,
and unless an Event of Default has occurred and is continuing, the Borrower (each such approval not
to be unreasonably withheld or delayed). If the consent of the Borrower to an assignment or to an
Eligible Assignee is required hereunder (including a consent to an assignment which does not meet
the minimum assignment thresholds specified in paragraph (b)(i) of Section 10.4), the
Borrower shall be deemed to have given its consent five Business Days after the date notice thereof
has actually been delivered by the assigning Lender (through the Administrative Agent) to the
Borrower, unless such consent is expressly refused by the Borrower prior to such fifth Business
Day.



“Environmental Laws” shall mean all laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into
by or with any Governmental Authority, relating in any way to the environment, preservation or
reclamation of natural resources, the management, Release or threatened Release of any Hazardous
Material or to health and safety matters.



“Environmental Liability” shall mean any liability, contingent or otherwise (including any
liability for damages, costs of environmental investigation and remediation, costs of
administrative oversight, fines, natural resource damages, penalties or indemnities), of the
Borrower or any Subsidiary directly or indirectly resulting from or based upon (i) any actual or
alleged violation of any Environmental Law, (ii) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (iii) any actual or alleged exposure to
any Hazardous Materials, (iv) the Release or threatened



 


9









 






Release of any Hazardous Materials or (v)
any contract, agreement or other consensual arrangement pursuant to which liability is assumed or
imposed with respect to any of the foregoing.



“Equity Interests” shall mean shares of Capital Stock, partnership interests, membership
interests in a limited liability company, beneficial interests in a trust or other equity ownership
interests in
a Person, and any warrants, options or other rights entitling the holder thereof to purchase
or acquire any such equity interest.



“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time
to time, and any successor statute.



“ERISA Affiliate” shall mean any trade or business (whether or not incorporated), which,
together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code
or, solely for the purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a
single employer under Section 414 of the Code.



“ERISA Event” shall mean (i) any “reportable event”, as defined in Section 4043 of ERISA or
the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day
notice period is waived); (ii) the failure of any Plan to meet the minimum funding standard
applicable to the Plan for a plan year under Section 412 of the Code or Section 302 of ERISA,
whether or not waived; (iii) the filing pursuant to Section 412(d) of the Code or Section 303(d) of
ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (iv)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of
ERISA with respect to the termination of any Plan; (v) the receipt by the Borrower or any ERISA
Affiliate from the PBGC or a plan administrator appointed by the PBGC of any notice relating to an
intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (vi) the
incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (vii) the receipt by the
Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the
Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or
a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.



“Eurodollar” when used in reference to any Loan or Borrowing, refers to whether such Loan, or
the Loans comprising such Borrowing, bears interest at a rate determined by reference to the
Adjusted LIBO Rate.



“Eurodollar Reserve Percentage” shall mean the aggregate of the maximum reserve percentages
(including, without limitation, any emergency, supplemental, special or other marginal reserves)
expressed as a decimal (rounded upwards to the next 1/100th of 1%) in effect on any day
to which the Administrative Agent is subject with respect to the Adjusted LIBO Rate pursuant to
regulations issued by the Board of Governors of the Federal Reserve System (or any Governmental
Authority succeeding to any of its principal functions) with respect to eurocurrency funding
(currently referred to as “eurocurrency liabilities” under Regulation D). Eurodollar Loans shall
be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available from time to time
to any Lender under Regulation D. The Eurodollar Reserve Percentage shall be adjusted
automatically on and as of the effective date of any change in any reserve percentage.




“Event of Default” shall have the meaning provided in Article VIII.



 


10









 





“Excluded Taxes” shall mean with respect to the Administrative Agent, any Lender or any other
recipient of any payment to be made by or on account of any obligation of the Borrower hereunder,
(i) income or franchise taxes imposed on (or measured by) its net income by the United States of
America, or by the jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its applicable lending office
is located, (ii) any branch profits taxes imposed by the United States of America or any similar
tax imposed by any
other jurisdiction in which any Lender is located and (iii) in the case of a Foreign Lender,
any withholding tax that (x) is imposed on amounts payable to such Foreign Lender at the time such
Foreign Lender becomes a party to this Agreement, (y) is imposed on amounts payable to such Foreign
Lender at any time that such Foreign Lender designates a new lending office, other than taxes that
have accrued prior to the designation of such lending office that are otherwise not Excluded Taxes,
and (z) is attributable to such Foreign Lender’s failure to comply with Section
2.18(e).



“Existing Credit Agreement” shall mean that certain Credit Agreement, dated as of June 4,
2007, by and among the Borrower, the lenders from time to time parties thereto and SunTrust Bank,
as Administrative Agent, as amended or modified from time to time.



“Existing Lenders” shall mean all lenders parties to the Existing Credit Agreement on the
Closing Date (as defined in the Existing Credit Agreement).



“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded upwards, if
necessary, to the next 1/100th of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with member banks of the Federal Reserve System arranged by
Federal funds brokers, as published by the Federal Reserve Bank of New York on the next succeeding
Business Day or if such rate is not so published for any Business Day, the Federal Funds Rate for
such day shall be the average rounded upwards, if necessary, to the next 1/100th of 1% of the
quotations for such day on such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by the Administrative Agent.



“Fee Letter” shall mean that certain fee letter, dated as of February 19, 2010, executed by
the Administrative Agent and accepted by Borrower.



“First Lien Bank Loan” means a Bank Loan that is entitled to the benefit of a first lien and
first priority perfected security interest on a substantial portion of the assets of the respective
borrower and guarantors obligated in respect thereof.




“Fiscal Quarter” shall mean any fiscal quarter of the Borrower.




“Fiscal Year” shall mean any fiscal year of the Borrower.



“Foreign Lender” shall mean any Lender that is not a United States person under Section
7701(a)(30) of the Code.



“GAAP” shall mean generally accepted accounting principles in the United States applied on a
consistent basis and subject to the terms of Section 1.3.



“Governmental Authority” shall mean the government of the United States of America, any other
nation or any political subdivision thereof, whether state or local, and any agency, authority,
instrumentality, regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to
government.



 


11









 





“Guarantee” of or by any Person (the “guarantor”) shall mean any obligation, contingent or
otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any
Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly and including any obligation, direct or indirect, of the guarantor (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation or to purchase (or to advance or supply funds for the purchase of) any security
for the payment thereof, (ii)
to purchase or lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity of the primary obligor so as
to enable the primary obligor to pay such Indebtedness or other obligation or (iv) as an account
party in respect of any letter of credit or letter of guaranty issued in support of such
Indebtedness or obligation; provided, that the term “Guarantee” shall not include
endorsements for collection or deposit in the ordinary course of business. The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which Guarantee is made or, if not so stated or determinable, the maximum
reasonably anticipated liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith. The term “Guarantee” used as a verb has a
corresponding meaning.



“Hazardous Materials” shall mean all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to
any Environmental Law.



“Hedging Obligations” of any Person shall mean any and all obligations of such Person, whether
absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired under
(i) any and all Hedging Transactions, (ii) any and all cancellations, buy backs, reversals,
terminations or assignments of any Hedging Transactions and (iii) any and all renewals, extensions
and modifications of any Hedging Transactions and any and all substitutions for any Hedging
Transactions.



“Hedging Transaction” of any Person shall mean (a) any transaction (including an agreement
with respect to any such transaction) now existing or hereafter entered into by such Person that is
a rate swap transaction, swap option, basis swap, forward rate transaction, commodity swap,
commodity option, equity or equity index swap or option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction, currency swap
transaction, cross-currency rate swap transaction, currency option, spot transaction, credit
protection transaction, credit swap, credit default swap, credit default option, total return swap,
credit spread transaction, repurchase transaction, reverse repurchase transaction, buy/sell-back
transaction, securities lending transaction, or any other similar transaction (including any option
with respect to any of these transactions) or any combination thereof, whether or not any such
transaction is governed by or subject to any master agreement and (b) any and all transactions of
any kind, and the related confirmations, which are subject to the terms and conditions of, or
governed by, any form of master agreement published by the International Swaps and Derivatives
Association, Inc., any International Foreign Exchange Master Agreement, or any other master
agreement (any such master agreement, together with any related schedules, a “Master Agreement”),
including any such obligations or liabilities under any Master Agreement.



“High Yield Securities” means debt Securities (including convertible debt) and Preferred Stock
(including convertible Preferred Stock), in each case (a) issued by public or private issuers, (b)
issued pursuant to an effective registration statement or pursuant to Rule 144A under the
Securities Act (or any successor provision thereunder) and (c) that are not Cash Equivalents or
Bank Loans.



 


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“Indebtedness” of any Person shall mean, 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 in respect of the deferred
purchase price of property or services (other than trade payables incurred in the ordinary course
of business on terms customary in the trade), (iv) all obligations of such Person under any
conditional sale or other title
retention agreement(s) relating to property acquired by such Person, (v) Capital Lease
Obligations of such Person, (vi) obligations, contingent or otherwise, of such Person in respect of
letters of credit, acceptances or similar extensions of credit, (vii) guaranties by such Person of
the type of Indebtedness described in clauses (i) through (vi) above, (viii) all Indebtedness of a
third party secured by any Lien on property owned by such Person, whether or not such Indebtedness
has been assumed by such Person, (ix) all obligations of such Person, contingent or otherwise, to
purchase, redeem, retire or otherwise acquire for value any common stock of such Person, (x)
Off-Balance Sheet Liabilities retained in connection with asset securitization programs, Synthetic
Leases, sale and leaseback transactions or other similar obligations arising with respect to any
other transaction which is the functional equivalent of or takes the place of borrowing but which
does not constitute a liability on the consolidated balance sheet of such Person and its
subsidiaries (xi) Net Mark to Market Exposure on all Hedging Obligations, and (xii) obligations
under any derivative contract including any commodity agreement, or foreign exchange 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 a joint venturer, except to the extent that the terms
of such Indebtedness provide that such Person is not liable therefor.




“Indemnified Taxes” shall mean Taxes other than Excluded Taxes.



“Information Memorandum” shall mean the confidential executive summary relating to the Loan
Parties and the transactions contemplated by this Agreement and the other Loan Documents.



“Interest Period” shall mean with respect to (i) any Swingline Borrowing, such period as the
Swingline Lender and the Borrower shall mutually agree and (ii) any Eurodollar Borrowing, a period
of one, two, three or six months; provided, that:




(i) the initial Interest Period for such Borrowing shall commence on the date of such
Borrowing (including the date of any conversion from a Borrowing of another Type), and each
Interest Period occurring thereafter in respect of such Borrowing shall commence on the day
on which the next preceding Interest Period expires;




(ii) if any Interest Period would otherwise end on a day other than a Business Day,
such Interest Period shall be extended to the next succeeding Business Day, unless such
Business Day falls in another calendar month, in which case such Interest Period would end
on the next preceding Business Day;




(iii) any Interest Period which begins on the last Business Day of a calendar month or
on a day for which there is no numerically corresponding day in the calendar month at the
end of such Interest Period shall end on the last Business Day of such calendar month;




(iv) no Interest Period may extend beyond the Revolving Commitment Termination Date.



“Investment Advisory Agreement” shall mean that certain Investment Management Agreement, dated
as of September 20, 2006, by and between Borrower and KA Fund Advisors, LLC, as amended by that
certain Amendment to Investment Management Agreement dated as of July 1, 2008.



 


13









 





“Investment Company Act” shall mean the Investment Company Act of 1940, as amended and in
effect from time to time.



“Investment Objective” shall mean those investment objectives, policies and restrictions that
are set forth in Schedule 4.10 subject to other modifications or supplements as may be
adopted by the Borrower from time to time and reflected in filings with the Securities and Exchange
Commission that do not result in a Material Adverse Effect.



“Lender Insolvency Event” shall mean that (i) a Lender or its Parent Company is insolvent, or
is generally unable to pay its debts as they become due, or admits in writing its inability to pay
its debts as they become due, or makes a general assignment for the benefit of its creditors, or
(ii) a Lender or its Parent Company is the subject of a bankruptcy, insolvency, reorganization,
liquidation or similar proceeding, or a receiver, trustee, conservator, custodian or the like has
been appointed for such Lender or its Parent Company, or such Lender or its Parent Company has
taken any action in furtherance of or indicating its consent to or acquiescence in any such
proceeding or appointment, or (iii) a Lender or its Parent Company has been adjudicated as, or
determined by any Governmental Authority having regulatory authority over such Person or its assets
to be, insolvent; provided that, for the avoidance of doubt, a Lender Insolvency Event shall not
be deemed to have occurred solely by virtue of the ownership or acquisition of any equity interest
in or control of a Lender or a Parent Company thereof by a Governmental Authority or an
instrumentality thereof. 



“Lender-Related Hedge Provider” means any Person that, at the time it enters into a Hedging
Transaction with any Loan Party, (i) is a Lender or an Affiliate of a Lender and (ii) except when
the Lender-Related Hedge Provider is SunTrust Bank and its Affiliates, has provided prior written
notice to the Administrative Agent which has been acknowledged by the Borrower of (x) the existence
of such Hedging Transaction, and (y) the methodology to be used by such parties in determining the
obligations under such Hedging Transaction from time to time. In no event shall any Lender-Related
Hedge Provider acting in such capacity be deemed a Lender for purposes hereof to the extent of and
as to Hedging Obligations except that each reference to the term “Lender” in Article IX and Section
10.4 shall be deemed to include such Lender-Related Hedge Provider. In no event shall the approval
of any such Person in its capacity as Lender-Related Hedge Provider be required in connection with
the release or termination of any security interest or Lien of the Administrative Agent.



“Lenders” shall have the meaning assigned to such term in the opening paragraph of this
Agreement and shall include, where appropriate, the Swingline Lender and each Additional Lender
that joins this Agreement pursuant to Section 2.20.



“LIBOR” shall mean, for any Interest Period, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBOR01 Page (or any successor
page) as the London interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two business days prior to the first day of such Interest Period for a term
comparable to such Interest Period. If for any reason such rate is not available, LIBOR shall be,
for any Interest Period, the rate per annum reasonably determined by the Agent as the rate of
interest at which Dollar deposits in the approximate amount of the LIBOR loan comprising part of
such borrowing would be offered by the Agent to major banks in the London interbank Eurodollar
market at their request at or about 10:00 a.m. (Atlanta, Georgia time) two business days prior to
the first day of such Interest Period for a term comparable to such Interest Period. Such rates
may be adjusted for any applicable reserve requirements.



“Lien” shall mean any mortgage, pledge, security interest, lien (statutory or otherwise),
charge, encumbrance, hypothecation, assignment, deposit arrangement, or other arrangement having
the



 


14









 






practical effect of the foregoing or any preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including any conditional sale or other
title retention agreement and any capital lease having the same economic effect as any of the
foregoing).



“Loan Documents” shall mean, collectively, this Agreement, the Notes (if any), the Subsidiary
Guarantee Agreements, the Security Documents, the Fee Letter, all Notices of Borrowing, all Notices
of Conversion/Continuation, all Compliance Certificates, all Borrowing Base Certificates and any
and all other instruments, agreements, documents, certificates and writings executed in connection
with any of the foregoing.




“Loan Parties” shall mean the Borrower and the Subsidiary Guarantors.



“Loans” shall mean all Revolving Loans and Swingline Loans in the aggregate or any of them, as
the context shall require.




“Lock-up Agreement” shall have the meaning assigned to such term in Section 7.7.



“Lock-up Term” shall mean, as of any date of determination, the number of days required to be
elapsed before the provisions in the applicable Lock-up Agreement that prohibit, restrict or impose
any condition upon the ability of the Borrower or any Subsidiary to transfer its property or
assets expire or are of no force or effect.



“Long-Term U.S. Government Securities” means U.S. Government Securities maturing more than one
year from the applicable date of determination.



“Material Adverse Effect” shall mean, with respect to any event, act, condition or occurrence
of whatever nature (including any adverse determination in any litigation, arbitration, or
governmental investigation or proceeding), whether singularly or in conjunction with any other
event or events, act or acts, condition or conditions, occurrence or occurrences whether or not
related, a material adverse change in, or a material adverse effect on, (i) the business, results
of operations, financial condition, assets, liabilities or prospects of the Borrower or of the
Borrower and its Subsidiaries, taken as a whole, which has had or could reasonably be expected to
have a material adverse effect on the ability of the Loan Parties to perform any of their
respective obligations under the Loan Documents, (ii) the rights and remedies of the Administrative
Agent, the Swingline Lender and the Lenders under any of the Loan Documents or (iii) the legality,
validity or enforceability of any of the Loan Documents.



“Material Indebtedness” shall mean Indebtedness (other than the Loans) and Hedging Obligations
of the Borrower or any of its Subsidiaries, individually or in an aggregate principal amount
exceeding $5,000,000. For purposes of determining the amount of attributed Indebtedness from
Hedging Obligations, the “principal amount” of any Hedging Obligations at any time shall be the Net
Mark-to-Market Exposure of such Hedging Obligations.



“MLP Subordinated Units” shall mean units of a limited partnership or a limited liability
company that has elected to be a partnership that are expressly subordinated by the terms of the
limited partnership agreement pursuant to which such units were issued.



“MLP Units” shall mean Public MLP Common and Preferred Units and Private MLP Common and
Preferred Units.




“Moody’s” shall mean Moody’s Investors Service, Inc.



 


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“Multiemployer Plan” shall have the meaning set forth in Section 4001(a)(3) of ERISA.



“Net Mark to Market Exposure” of any Person shall mean, as of any date of determination with
respect to any Hedging Obligation, the excess (if any) of all unrealized losses over all
unrealized profits of such Person arising from such Hedging Obligation. “Unrealized losses”
shall mean the fair market value of the cost to such Person of replacing the Hedging Transaction
giving rise to such Hedging Obligation as of the date of determination (assuming the Hedging
Transaction were to be terminated as of that date), and “unrealized profits” means the fair market
value of the gain to such Person of replacing such Hedging Transaction as of the date of
determination (assuming such Hedging Transaction were to be terminated as of that date).



“Non-Defaulting Lender” shall mean, at any time, a Lender that is not a Defaulting Lender or a
Potential Defaulting Lender.



“Non-Performing First Lien Bank Loans” means First Lien Bank Loans other than Performing First
Lien Bank Loans.



“Non-Performing High Yield Securities” means High Yield Securities other than Performing High
Yield Securities and Performing Non-Cash Pay High Yield Securities.



“Non-Performing Bank Loans” means, collectively, Non-Performing First Lien Bank Loans,
Non-Performing Second Lien Bank Loans, and Non-Performing Unsecured Bank Loans.



“Non-Performing Public MLP Common and Preferred Units” means Public MLP Common and Preferred
Units other than Performing Public MLP Common and Preferred Units.



“Non-Performing Second Lien Bank Loans” means Second Lien Bank Loans other than Performing
Second Lien Bank Loans.



“Non-Performing Unsecured Bank Loans” means Unsecured Bank Loans other than Performing
Unsecured Bank Loans.



“Notice of Conversion/Continuation” shall mean the notice given by the Borrower to the
Administrative Agent in respect of the conversion or continuation of an outstanding Borrowing as
provided in Section 2.6(b).




“Notice of Revolving Borrowing” shall have the meaning as set forth in Section 2.3.




“Notice of Swingline Borrowing” shall have the meaning as set forth in Section 2.4.



“Notices of Borrowing” shall mean, collectively, the Notices of Revolving Borrowing and the
Notices of Swingline Borrowing.



“Obligations” shall mean (a) all amounts owing by the Borrower to the Administrative Agent or
any Lender (including the Swingline Lender) pursuant to or in connection with this Agreement or any
other Loan Document, including without limitation, all principal, interest (including any interest
accruing after the filing of any petition in bankruptcy or the commencement of any insolvency,
reorganization or like proceeding relating to the Borrower, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding), all reimbursement obligations, fees,
expenses, indemnification and reimbursement payments, costs and expenses (including all fees and
expenses of counsel to the Administrative Agent and any Lender (including the Swingline Lender)
incurred pursuant



 


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to this Agreement or any other Loan Document), whether direct or indirect,
absolute or contingent, liquidated or unliquidated, now existing or hereafter arising hereunder or
thereunder, (b) all Hedging Obligations owed by any Loan Party to any Lender-Related Hedge
Provider, and (c) all Bank Product Obligations, together with all renewals, extensions,
modifications or refinancings of any of the foregoing.




“OFAC” shall mean the U.S. Department of the Treasury’s Office of Foreign Assets Control.



“Off-Balance Sheet Liabilities” of any Person shall mean (i) any repurchase obligation or
liability of such Person with respect to accounts or notes receivable sold by such Person, (ii) any
liability of such Person under any sale and leaseback transactions that do not create a liability
on the balance sheet of such Person, (iii) any Synthetic Lease Obligation or (iv) any obligation
arising with respect to any other transaction which is the functional equivalent of or takes the
place of borrowing but which does not constitute a liability on the balance sheet of such Person.



“Offer Period” shall mean a period during which a Person has the right to submit an offer to
the holder of a security if such holder undertakes any action to sell, transfer or otherwise
liquidate, or to market or offer for sale, or solicit offers to purchase such Security.



“OSHA” shall mean the Occupational Safety and Health Act of 1970, as amended from time to
time, and any successor statute.



“Other Taxes” shall mean any and all present or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies arising from any payment made hereunder or from
the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any
other Loan Document.



“Parent Company” shall mean, with respect to a Lender, the bank holding company (as defined in
Federal Reserve Board Regulation Y), if any, of such Lender, and/or any Person owning, beneficially
or of record, directly or indirectly, a majority of the shares of such Lender.




“Participant” shall have the meaning set forth in Section 10.4(d).




“Patriot Act” shall have the meaning set forth in Section 10.14.



“Payment Office” shall mean the office of the Administrative Agent located at 303 Peachtree
Street, N.E., Atlanta, Georgia 30308, or such other location as to which the Administrative Agent
shall have given written notice to the Borrower and the other Lenders.



“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and defined in ERISA,
and any successor entity performing similar functions.



“Perfection Certificate” shall have the meaning assigned to such term in the Security
Agreement.



“Performing” means (a) with respect to any Portfolio Investment that is debt or High Yield
Securities, the issuer of such Portfolio Investment is not in default of any payment obligations in
respect thereof, after the expiration of any applicable grace period, (b) with respect to any
Portfolio Investment that is Preferred Stock, the issuer of such Portfolio Investment has not
failed to meet any scheduled redemption obligations or to pay its latest declared cash dividend,
after the expiration of any applicable grace period, and (c) with respect to any Portfolio
Investment that is MLP Units, the issuer of



 


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such Portfolio Investment has not failed to pay
distributions in its most recent fiscal quarter or to pay its latest declared cash dividend and
there is no existing default under the issuer’s partnership agreement.



“Performing Cash Pay Bank Loans” means First Lien Bank Loans, Second Lien Bank Loans and
Unsecured Bank Loans (a) as to which, at the time of determination, all of the interest on which is
payable in cash not less frequently than quarterly and (b) which are Performing.



“Performing Cash Pay High Yield Securities” means High Yield Securities (a) as to which, at
the time of determination, not less than 2/3rds of the interest (including accretions and
“pay-in-kind” interest) for the current monthly, quarterly, semi-annual or annual period (as
applicable) is payable in cash and (b) which are Performing.



“Performing Common Equity” shall mean Capital Stock (other than Preferred Stock) and warrants
of an issuer all of whose outstanding debt is Performing.




“Performing First Lien Bank Loans” means First Lien Bank Loans which are Performing.



“Performing Non-Cash Pay Bank Loans” means Performing Bank Loans other than Performing Cash
Pay Bank Loans.



“Performing Non-Cash Pay High Yield Securities” means Performing High Yield Securities other
than Performing Cash Pay High Yield Securities.



“Performing Private MLP Common and Preferred Units” means Private MLP Common and Preferred
Units (a) as to which, at the time of determination, not less than 80% of the minimum quarterly
distribution for the most recent fiscal quarter period then ending for such issuer of such MLP
Units has been paid in cash and (b) which are Performing.



“Performing Public MLP Common and Preferred Units” means Public MLP Common and Preferred Units
(a) as to which, at the time of determination, not less than 80% of the minimum quarterly
distribution for the most recent fiscal quarter period then ending for such issuer of such MLP
Units has been paid in cash (or in the case of Kinder, Enbridge or similar investments included in
the definition of MLP Units, additional shares), and (b) which are Performing.




“Performing Second Lien Bank Loans” means Second Lien Bank Loans which are Performing.




“Performing Unsecured Bank Loans” shall mean Unsecured Bank Loans which are Performing.




“Performing Warrants” shall mean Warrants which are Performing.




“Permitted Encumbrances” shall mean




(i) Liens imposed by law for taxes not yet due or which are being contested in good
faith by appropriate proceedings diligently conducted and with respect to which adequate
reserves are being maintained in accordance with GAAP;




(ii) statutory Liens of landlords, carriers, warehousemen, mechanics, materialmen and
similar Liens arising by operation of law in the ordinary course of business for amounts not



 


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yet due or which are being contested in good faith by appropriate proceedings and with
respect to which adequate reserves are being maintained in accordance with GAAP;




(iii) pledges and deposits made in the ordinary course of business in compliance with
workers’ compensation, unemployment insurance and other social security laws or regulations;




(iv) deposits to secure the performance of bids, trade contracts, leases, statutory
obligations, surety and appeal bonds, performance bonds and other obligations of a like
nature, in each case in the ordinary course of business;




(v) judgment and attachment liens not giving rise to an Event of Default or Liens
created by or existing from any litigation or legal proceeding that are currently being
contested in good faith by appropriate proceedings and with respect to which adequate
reserves are being maintained in accordance with GAAP;




(vi) customary rights of set-off, revocation, refund or chargeback under deposit
agreements or under the Uniform Commercial Code or common law of banks or other financial
institutions where Borrower or any of its Subsidiaries maintains deposits (other than
deposits intended as cash collateral) in the ordinary course of business;




(vii) easements, zoning restrictions, rights-of-way and similar encumbrances on real
property imposed by law or arising in the ordinary course of business that do not secure any
monetary obligations and do not materially detract from the value of the affected property
or materially interfere with the ordinary conduct of business of the Borrower and its
Subsidiaries taken as a whole;




(viii) Liens imposed on amounts held in the Borrower’s or its Subsidiaries’ Approved
Brokerage Accounts in accordance with option transactions or other similar transactions;
provided, that in no event shall the sum of the fair market value of the collateral
securing (A) such Liens or the obligations secured thereby and (B) the Liens or the
obligations secured thereby provided for in clause (ix) below exceed $5,000,000 in the
aggregate at any time; and;




(ix) Liens securing obligations incurred under any Clearing Account; provided, that the
custodian of such Clearing Account and the Administrative Agent have entered into an
agreement in form and substance satisfactory to the Administrative Agent which, among other
things, requires all amounts and Securities in excess of $1,000,000 to be transferred prior
to the end of each Business Day to a Collateral Account;




provided, that the term “Permitted Encumbrances” shall not include any Lien securing
Indebtedness, except for Indebtedness set forth on Schedule 7.1 hereto.



“Person” shall mean any individual, partnership, firm, corporation, association, joint
venture, limited liability company, trust or other entity, or any Governmental Authority.



“Plan” shall mean any employee pension benefit plan (other than a Multiemployer Plan) subject
to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in
respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would
under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.



 


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“Potential Defaulting Lender” shall mean, at any time, a Lender (i) as to which the
Administrative Agent has notified the Borrower that an event of the kind referred to in the
definition of “Lender Insolvency Event” has occurred and is continuing in respect of any financial
institution affiliate of such Lender, (ii) that has (or its Parent Company or a financial
institution affiliate thereof has) notified
the Administrative Agent, or has stated publicly, that it will not comply with its funding
obligations under any other loan agreement or credit agreement or other similar/other financing
agreement or (iii) that has, or whose Parent Company has, a non-investment grade rating from
Moody’s or S&P or another nationally recognized rating agency. The Administrative Agent will
promptly send to all parties hereto a copy of any notice to the Borrower provided for in this
definition.



“Portfolio Investment” means any investment held by the Borrower in its asset portfolio (and,
solely for purposes of determining the Borrowing Base, Cash). Without limiting the generality of
the foregoing, it is understood and agreed that any Portfolio Investments that have been
contributed or sold, purported to be sold or otherwise transferred to any Special Purpose
Subsidiary shall not be treated as Portfolio Investments. Notwithstanding the foregoing, nothing
herein shall limit the provisions of Section 5.12(a)(i), which provides that, for purposes
of this Agreement, all determinations of whether an investment is to be included as a Portfolio
Investment shall be determined on a settlement-date basis, provided that no such investment
shall be included as a Portfolio Investment to the extent it has not been paid for in full.



“Preferred Stock,” as applied to the Capital Stock of any Person, means Capital Stock of such
Person of any class or classes (however designated) that ranks prior, as to the payment of
dividends or as to the distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person, to any shares (or other interests) of other Capital Stock
of such Person, and shall include, without limitation, cumulative preferred, non-cumulative
preferred, participating preferred and convertible preferred Capital Stock.



“Pro Rata Share” shall mean with respect to any Commitment of any Lender at any time, a
percentage, the numerator of which shall be such Lender’s Commitment (or if such Commitments have
been terminated or expired or the Loans have been declared to be due and payable, such Lender’s
Revolving Credit Exposure), and the denominator of which shall be the sum of Commitments of all
Lenders (or if the Commitments have been terminated or expired or the Loans have been declared to
be due and payable, all Revolving Credit Exposure).



“Private MLP Common and Preferred Units” shall mean common and preferred units, for which, the
issuer of such MLP Units shall not have any class of units traded on a national stock exchange in
the United States of America of a limited partnership or a limited liability company that has
elected to be a partnership.



“Public MLP Common and Preferred Units” shall mean (i) common or preferred units, which are
traded on a national stock exchange in the United States of America, of a limited partnership or a
limited liability company that has elected to be a partnership and (ii) investments in Enbridge
Energy Management, Inc. (“Enbridge”), Kinder Morgan Management, Inc. (“Kinder”) and similarly
structured investments in form and substance satisfactory to the Administrative Agent in its sole
discretion.



“Quotations” shall mean (a) in the case of bank loans, the mean price as determined by one
Approved Dealer selected by the Borrower and approved by the Administrative Agent in its sole
discretion, (b) in the case of any Portfolio Investment traded on an exchange, the closing price
for such Portfolio Investment most recently posted on such exchange, and (c) in the case of any
other Portfolio Investment, the fair market value thereof as determined by an Approved Pricing
Service.



 


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“Quoted Securities” shall mean, without duplication, Cash, Cash Equivalents and Portfolio
Investments for which Quotations are readily available.



“Quoted Securities Borrowing Base” shall mean that portion of the Borrowing Base attributable
to Quoted Securities.



“Register” has the meaning assigned to such term in clause (c) of Section
10.4.



“Regulation D” shall mean Regulation D of the Board of Governors of the Federal Reserve
System, as the same may be in effect from time to time, and any successor regulations.



“Regulation U” shall mean Regulation U of the Board of Governors of the Federal Reserve
System, as the same may be in effect from time to time, and any successor regulations.



“Related Parties” shall mean, with respect to any specified Person, such Person’s Affiliates
and the respective directors, officers, employees, agents and advisors of such Person and such
Person’s Affiliates.



“Release” shall mean any release, spill, emission, leaking, dumping, injection, pouring,
deposit, disposal, discharge, dispersal, leaching or migration into the environment (including
ambient air, surface water, groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture.



“Required Lenders” shall mean, at any time, Lenders holding more than 50% of the aggregate
outstanding Commitments at such time or if the Lenders have no Commitments outstanding, then
Lenders holding more than 50% of the aggregate Revolving Credit Exposure; provided,
however, that, in the case of any amendment to the Borrowing Base pursuant to Section
10.2(b)(vii), Required Lenders shall mean Lenders holding more than 662/3% of the aggregate
outstanding Commitments at such time or if the Lenders have no Commitments outstanding then Lenders
holding more than
662/3% of the aggregate Revolving Credit Exposure.




“Required Threshold” shall have the meaning set forth in Section 6.1.



“Requirement of Law” for any Person shall mean the articles or certificate of incorporation,
bylaws, partnership certificate and agreement, or limited liability company certificate of
organization and agreement, as the case may be, and other organizational and governing documents of
such Person, and any law, treaty, rule or regulation, or determination of a Governmental Authority,
in each case applicable to or binding upon such Person or any of its property or to which such
Person or any of its property is subject



“Responsible Officer” shall mean any of the president, the chief executive officer, the chief
operating officer, the chief financial officer, the treasurer or a vice president of the Borrower
or such other representative of the Borrower as may be designated in writing by any one of the
foregoing with the consent of the Administrative Agent; and, with respect to the financial
covenants only, the chief financial officer or the treasurer of the Borrower.



“Restricted Payment” shall mean, for any Person, any dividend or distribution on any class of
its Capital Stock, or any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, retirement, defeasance or other acquisition of, any
shares of its Capital Stock, any Indebtedness subordinated to the Obligations or any Guarantee
thereof or any



 


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options, warrants, or other rights to purchase such Capital Stock or such
Indebtedness, whether now or hereafter outstanding.



“Revolving Commitment” shall mean, with respect to each Lender, the obligation of such Lender
to make Revolving Loans to the Borrower and to participate in Swingline Loans in an aggregate
principal amount not exceeding the amount set forth with respect to such Lender on Schedule
I, as such schedule may be amended pursuant to Section 2.20, or in the case of a Person
becoming a Lender after the Closing Date, the amount of the assigned “Revolving Commitment” as
provided in the Assignment and Acceptance executed by such Person as an assignee, or the joinder
executed by such Person, in each case as such commitment may subsequently be increased or decreased
pursuant to terms hereof.



“Revolving Commitment Amount” shall mean the aggregate principal amount of the Revolving
Commitments from time to time. On the Closing Date, the Revolving Commitment Amount equals
$70,000,000.



“Revolving Commitment Termination Date” shall mean the earliest of (i) March 30, 2013, (ii)
the date on which the Revolving Commitments are terminated pursuant to Section 2.7 and
(iii) the date on which all amounts outstanding under this Agreement have been declared or have
automatically become due and payable (whether by acceleration or otherwise).



“Revolving Credit Exposure” shall mean, with respect to any Lender at any time, the sum of the
outstanding principal amount of such Lender’s Revolving Loans and Swingline Exposure.



“Revolving Loan” shall mean a loan made by the Lender (other than the Swingline Lender) to the
Borrower under its Revolving Commitment, which may either be a Base Rate Loan or a Eurodollar Loan.



“Right of First Offer” shall mean any provision, term or condition which gives a Person the
first option of buying or providing an offer with respect to a Security if the holder of such
Security undertakes any action to sell, transfer or otherwise liquidate, or to market or offer for
sale, or solicit offers to purchase such Security.




“S&P” shall mean Standard & Poor’s, a Division of the McGraw Hill Companies.



“Sanctioned Country” shall mean a country subject to a sanctions program identified on the
list maintained by OFAC and available at
http://www.treas.gov/offices/eotffc/ofac/sanctions/index.html, or as otherwise published
from time to time.



“Sanctioned Person” shall mean (i) a Person named on the list of “Specially Designated
Nationals and Blocked Persons” maintained by OFAC available at
http://www.treas.gov/offices/eotffc/ofac/sdn/index.html, or as otherwise published from
time to time, or (ii) (A) an agency of the government of a Sanctioned Country, (B) an organization
controlled by a Sanctioned Country, or (C) a person resident in a Sanctioned Country, to the extent
subject to a sanctions program administered by OFAC.



“Security Agreement” shall mean that certain Amended and Restated Security Agreement, dated as
of the Closing Date, executed by the Borrower and the Subsidiaries in favor of the Administrative
Agent for the benefit of the Lenders, as amended, restated, supplemented or otherwise modified from
time to time.



 


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“Security Documents” shall mean, collectively, the Security Agreement, any Deeds of Trust or
other Real Estate Documents, any other Control Agreement, the Perfection Certificate, and all other
instruments and agreements now or hereafter securing the whole or any part of the Obligations or
any Guarantee thereof, all UCC financing statements, fixture financing statements, stock
powers, and all other documents, instruments, agreements and certificates executed and delivered by
any Loan Party to the Administrative Agent and the Lenders in connection herewith.



“Second Lien Bank Loan” means a Bank Loan that is entitled to the benefit of a second lien and
second priority perfected security interest on a substantial portion of the assets of the
respective borrower and guarantors obligated in respect thereof.



“Securities” means common and Preferred Stock, units and participations, member interests in
limited liability companies, partnership interests in partnerships, notes, bonds, debentures, trust
receipts and other obligations, instruments or evidences of indebtedness, including debt
instruments or public and private issuers and tax-exempt securities (including warrants, rights,
put and call options and other options relating thereto, representing rights, or any combination
thereof) and other property or interests commonly regarded as securities or any form of interest or
participation therein, but not including Bank Loans.




“Securities Act” means the United States Securities Act of 1933, as amended.



“Shareholders’ Equity” shall mean, at any date, the amount determined on a consolidated basis,
without duplication, in accordance with GAAP, of shareholders equity for the Borrower and its
Subsidiaries at such date.



“Short-Term U.S. Government Securities” means U.S. Government Securities maturing within one
year of the applicable date of determination.



“Solvent” shall mean, with respect to any Person on a particular date, that on such date (a)
the fair value of the property of such Person is greater than the total amount of liabilities,
including subordinated and contingent liabilities, of such Person; (b) the present fair saleable
value of the assets of such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts and liabilities, including subordinated and
contingent liabilities as they become absolute and matured; (c) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as
such debts and liabilities mature; and (d) such Person is not engaged in a business or transaction,
and is not about to engage in a business or transaction, for which such Person’s property would
constitute an unreasonably small capital. The amount of contingent liabilities (such as
litigation, guaranties and pension plan liabilities) at any time shall be computed as the amount
that, in light of all the facts and circumstances existing at the time, represents the amount that
would reasonably be expected to become an actual or matured liability.



“Special Purpose Subsidiary” shall mean any single purpose Subsidiary created for the purpose
of holding specific assets.



“Subsidiary” shall mean, with respect to any Person (the “parent”), any corporation,
partnership, joint venture, limited liability company, association or other entity the accounts of
which would be consolidated with those of the parent in the parent’s consolidated financial
statements if such financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, partnership, joint venture, limited liability company, association
or other entity (i) of which securities or other ownership interests representing more than 50% of
the equity or more than 50% of the ordinary voting power, or in the case of a partnership, more
than 50% of the general partnership



 


23









 






interests are, as of such date, owned, controlled or held, or
(ii) that is, as of such date, otherwise controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more
subsidiaries of the parent. Unless otherwise indicated, all references to “Subsidiary”
hereunder shall mean a Subsidiary of the Borrower.



“Subsidiary Guarantee Agreement” shall mean any guaranty agreement, in the form of Exhibit
B attached hereto or in any other form, in form and substance satisfactory to the Agent,
executed from time to time by any Subsidiary in favor of the Administrative Agent and the Lenders,
as amended, restated, supplemented or otherwise modified from time to time.



“Subsidiary Guarantor” shall mean any Subsidiary of Borrower that executes and delivers a
Subsidiary Guarantee Agreement on the Closing Date or from time to time pursuant to Section
5.11.



“Swingline Commitment” shall mean the commitment of the Swingline Lender to make Swingline
Loans in an aggregate principal amount at any time outstanding not to exceed $5,000,000.



“Swingline Exposure” shall mean, with respect to each Lender, the principal amount of the
Swingline Loans in which such Lender is legally obligated either to make a Base Rate Loan or to
purchase a participation in accordance with Section 2.4, which shall equal such Lender’s
Pro Rata Share of all outstanding Swingline Loans.



“Swingline Lender” shall mean SunTrust Bank, or any other Lender that may agree to make
Swingline Loans hereunder.



“Swingline Loan” shall mean a loan made to the Borrower by the Swingline Lender under the
Swingline Commitment.



“Syndication Agent” shall have the meaning assigned to such term in the opening paragraph
hereof.



“Synthetic Lease” shall mean a lease transaction under which the parties intend that (i) the
lease will be treated as an “operating lease” by the lessee pursuant to Statement of Financial
Accounting Standards No. 13, as amended and (ii) the lessee will be entitled to various tax and
other benefits ordinarily available to owners (as opposed to lessees) of like property.



“Synthetic Lease Obligations” shall mean, with respect to any Person, the sum of (i) all
remaining rental obligations of such Person as lessee under Synthetic Leases which are attributable
to principal and, without duplication, (ii) all rental and purchase price payment obligations of
such Person under such Synthetic Leases assuming such Person exercises the option to purchase the
lease property at the end of the lease term.



“Tag Along Rights” shall mean tag along, co-sale or other similar contractual rights that
allow a holder of a Security to join in a proposed sale of Securities by another Person and sell
all or any portion of the Securities held by such holder.



“Taxes” shall mean any and all present or future taxes, levies, imposts, duties, deductions,
charges or withholdings imposed by any Governmental Authority.



 


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“Type”, when used in reference to a Loan or Borrowing, refers to whether the rate of interest
on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted
LIBO Rate or the Base Rate.



“Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as in effect from time to
time in the State of New York.



“Unsecured Bank Loan” shall mean a Bank Loan that is not secured by a lien or security
interest.



“U.S. Government Securities” shall mean securities that are direct obligations of, and
obligations the timely payment of principal and interest on which is fully guaranteed by, the
United States or any agency or instrumentality of the United Stats the obligations of which are
backed by the full faith and credit of the United States and in the form of conventional bills,
bonds and notes.



“Value” means, with respect to any Portfolio Investment, the lower of the most recent internal
fair market value as determined pursuant to Section 5.12(a)(ii)(C) and the most recent
external fair market value as determined pursuant to Section 5.12(a)(ii)(A) and
(B).



“Warrant” shall mean any rights, options or warrants to subscribe for or purchase or otherwise
acquire common stock or convertible securities, whether or not the right to exercise such rights,
options or warrants is immediately exercisable or is conditioned upon the passage of time, the
occurrence or non-occurrence of some other event, or both.



“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result of a complete
or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle
E of Title IV of ERISA.



Section 1.2. Classifications of Loans and Borrowings. For purposes of this Agreement,
Loans and Borrowings may be classified and referred to by Class (e.g. a “Revolving Loan” or
“Revolving Borrowing”), by Type (e.g. a “Eurodollar Loan”, “Base Rate Loan”, “Eurodollar Borrowing”
or “Base Rate Borrowing”) or by Class and Type (e.g. a “Revolving Eurodollar Loan” or “Revolving
Eurodollar Borrowing”).



Section 1.3. Accounting Terms and Determination. Unless otherwise defined or
specified herein, all accounting terms used herein shall be interpreted, all accounting
determinations hereunder shall be made, and all financial statements required to be delivered
hereunder shall be prepared, in accordance with GAAP as in effect from time to time, applied on a
basis consistent with the most recent audited consolidated financial statement of the Borrower
delivered pursuant to Section 5.1(a); provided, that if the Borrower
notifies the Administrative Agent that the Borrower wishes to amend any covenant in Article VI to
eliminate the effect of any change in GAAP on the operation of such covenant (or if the
Administrative Agent notifies the Borrower that the Required Lenders wish to amend Article VI for
such purpose), then the Borrower’s compliance with such covenant shall be determined on the basis
of GAAP in effect immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such covenant is amended in a manner satisfactory to the Borrower and
the Required Lenders. Notwithstanding any other provision contained herein, all terms of an
accounting or financial nature used herein shall be construed, and all computations of amounts and
ratios referred to herein shall be made, without giving effect to any election under Statement of
Financial Accounting Standards 159 (or any other Financial Accounting Standard having a similar
result or effect) to value any



 


25









 






Indebtedness or other liabilities of any Loan Party or any
Subsidiary of any Loan Party at “fair value”, as defined therein.



Section 1.4. Terms Generally. The definitions of terms herein shall apply equally to
the singular and plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The
word “will” shall be construed to have the same meaning and effect as the word “shall”. In the
computation of periods of time from a specified date to a later specified date, the word “from”
means “from and including” and the word “to” means “to but excluding”. Unless the context requires
otherwise (i) any definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document as it was
originally executed or as it may from time to time be amended, restated, supplemented or otherwise
modified (subject to any restrictions on such amendments, supplements or modifications set forth
herein), (ii) any reference herein to any Person shall be construed to include such Person’s
successors and permitted assigns, (iii) the words “hereof”, “herein” and “hereunder” and words of
similar import shall be construed to refer to this Agreement as a whole and not to any particular
provision hereof, (iv) all references to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles, Sections, Exhibits and Schedules to this Agreement and (v) all
references to a specific time shall be construed to refer to the time in the city and state of the
Administrative Agent’s principal office, unless otherwise indicated.



ARTICLE II




AMOUNT AND TERMS OF THE COMMITMENTS




Section 2.1. General Description of Facilities. Subject to and upon the terms and
conditions herein set forth, (i) the Lenders hereby establish in favor of the Borrower a revolving
credit facility pursuant to which each Lender severally agrees (to the extent of such Lender’s
Commitment) to make Loans to the Borrower in accordance with Section 2.2 and Section
2.3, (ii) the Swingline Lender agrees to make Swingline Loans in accordance with Section
2.4, and (iii) each Lender agrees to purchase a participation interest in the Swingline Loans
pursuant to the terms and conditions hereof; provided, that in no event shall the aggregate
principal amount of all outstanding Loans exceed at any time the Aggregate Commitment Amount from
time to time in effect.



Section 2.2. Revolving Loans. Subject to the terms and conditions set forth herein,
each Lender severally agrees to make Revolving Loans, ratably in proportion to its Pro Rata Share,
to the Borrower, from time to time during the Availability Period, in an aggregate principal amount
outstanding at any time that will not result in (a) such Lender’s Revolving Credit Exposure
exceeding such Lender’s Revolving Commitment or (b) the aggregate Revolving Credit Exposures of all
Lenders exceeding the Borrowing Limit. During the Availability Period, the Borrower shall be
entitled to borrow, prepay and reborrow Revolving Loans in accordance with the terms and conditions
of this Agreement; provided, that the Borrower may not borrow or reborrow should there
exist a Default or Event of Default.



Section 2.3. Procedure for Borrowings. The Borrower shall give the Administrative
Agent written notice (or telephonic notice promptly confirmed in writing) of each Borrowing
substantially in the form of Exhibit 2.3 (a “Notice of Borrowing”) (x) prior to 11:00 a.m.
(New York time) on the date of each Base Rate Borrowing and (y) prior to 2:00 p.m. (New York time)
three (3) Business Days prior to the requested date of each Eurodollar Borrowing. Each Notice of
Borrowing shall be irrevocable and shall specify: (i) the
aggregate principal amount of such



 


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Borrowing, (ii) the date of such Borrowing (which shall be
a Business Day), (iii) the Class of such Loan comprising such Borrowing; (iv) the Type of such Loan
comprising such Borrowing and (v) in the case of a Eurodollar Borrowing, the duration of the
initial Interest Period applicable thereto (subject to the provisions of the definition of Interest
Period). Each Borrowing shall consist entirely of Base Rate Loans or Eurodollar Loans, as the
Borrower may request. The aggregate principal amount of each Eurodollar Borrowing shall be not
less than $1,000,000 or a larger multiple of $250,000, and the aggregate principal amount of each
Base Rate Borrowing shall not be less than $250,000 or a larger multiple of $100,000;
provided, that Base Rate Loans made pursuant to Section 2.4 may be made in lesser
amounts as provided therein. At no time shall the total number of Eurodollar Borrowings
outstanding at any time exceed four. Promptly following the receipt of a Notice of Borrowing in
accordance herewith, the Administrative Agent shall advise each Lender of the details thereof and
the amount of such Lender’s Loan to be made as part of the requested Borrowing.




Section 2.4. Swingline Commitment.



(a) Subject to the terms and conditions set forth herein, the Swingline Lender may, in its
sole discretion, make Swingline Loans to the Borrower, from time to time during the Availability
Period, in an aggregate principal amount outstanding at any time not to exceed the lesser of (i)
the Swingline Commitment then in effect and (ii) Borrowing Availability; provided, that the
Swingline Lender shall not be required to make a Swingline Loan to refinance an outstanding
Swingline Loan. Moreover, the Swingline Loan outstanding to Borrower shall not exceed at any time
the Borrowing Base less the Revolving Loans outstanding to Borrowers. The Borrower shall be
entitled to borrow, repay and reborrow Swingline Loans in accordance with the terms and conditions
of this Agreement.



(b) The Borrower shall give the Administrative Agent written notice (or telephonic notice
promptly confirmed in writing) of each Swingline Borrowing substantially in the form of Exhibit
2.4 attached hereto (“Notice of Swingline Borrowing”) prior to 10:00 a.m. (New York time) on
the requested date of each Swingline Borrowing. Each Notice of Swingline Borrowing shall be
irrevocable and shall specify: (i) the principal amount of such Swingline Loan, (ii) the date of
such Swingline Loan (which shall be a Business Day) and (iii) the account of the Borrower to which
the proceeds of such Swingline Loan should be credited. The Administrative Agent will promptly
advise the Swingline Lender of each Notice of Swingline Borrowing. Each Swingline Loan shall
accrue interest at the Base Rate plus the Applicable Margin. The aggregate principal amount of
each Swingline Loan shall be not less than $100,000 or a larger multiple of $50,000, or such other
minimum amounts agreed to by the Swingline Lender and the Borrower. The Swingline Lender will make
the proceeds of each Swingline Loan available to the Borrower in Dollars in immediately available
funds at the account specified by the Borrower in the applicable Notice of Swingline Borrowing not
later than 1:00 p.m. (New York time) on the requested date of such Swingline Loan.



(c) The Swingline Lender, at any time and from time to time in its sole discretion, may, but
in no event no less frequently than once each calendar week shall, on behalf of the Borrower (which
hereby irrevocably authorizes and directs the Swingline Lender to act on its behalf), give a Notice
of Revolving Borrowing to the Administrative Agent requesting the Lenders (including the Swingline
Lender) to make Base Rate Loans in an amount equal to the unpaid principal amount of any Swingline
Loan. Each Lender will make the proceeds of its Base Rate Loan included in such Borrowing
available to the Administrative Agent for the account of the Swingline Lender in accordance with
Section 2.5, which will be used solely for the repayment of such Swingline Loan.



(d) If for any reason a Base Rate Borrowing may not be (as determined in the sole discretion
of the Administrative Agent), or is not, made in accordance with the foregoing provisions, then
each Lender (other than the Swingline Lender) shall purchase an undivided participating interest in
such



 


27









 






Swingline Loan in an amount equal to its Pro Rata Share thereof on the date that such Base
Rate Borrowing should have occurred. On the date of such required purchase, each Lender shall
promptly transfer, in immediately available funds, the amount of its participating interest to the
Administrative Agent for the account of the Swingline Lender. If such Swingline Loan bears
interest at a rate other than the Base Rate, such Swingline Loan shall automatically become a Base
Rate Loan on the effective date of any such participation and interest shall become payable on
demand.



(e) Each Lender’s obligation to make a Base Rate Loan pursuant to Section
2.4(c) or to purchase the participating interests pursuant to Section
2.4(d) shall be absolute and unconditional and shall not be affected by any
circumstance, including without limitation (i) any setoff, counterclaim, recoupment, defense or
other right that such Lender or any other Person may have or claim against the Swingline Lender,
the Borrower or any other Person for any reason whatsoever, (ii) the existence of a Default or an
Event of Default or the termination of any Lender’s Revolving Commitment, (iii) the existence (or
alleged existence) of any event or condition which has had or could reasonably be expected to have
a Material Adverse Effect, (iv) any breach of this Agreement or any other Loan Document by the
Borrower, the Administrative Agent or any Lender or (v) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing. If such amount is not in fact made
available to the Swingline Lender by any Lender, the Swingline Lender shall be entitled to recover
such amount on demand from such Lender, together with accrued interest thereon for each day from
the date of demand thereof (i) at the Federal Funds Rate until the second Business Day after such
demand and (ii) at the Base Rate at all times thereafter. Until such time as such Lender makes its
required payment, the Swingline Lender shall be deemed to continue to have outstanding Swingline
Loans in the amount of the unpaid participation for all purposes of the Loan Documents. In
addition, such Lender shall be deemed to have assigned any and all payments made of principal and
interest on its Loans and any other amounts due to it hereunder, to the Swingline Lender to fund
the amount of such Lender’s participation interest in such Swingline Loans that such Lender failed
to fund pursuant to this Section 2.4, until such amount has been purchased in full.




Section 2.5. Funding of Borrowings.



(a) Each Lender will make available each Loan to be made by it hereunder on the proposed date
thereof by wire transfer in immediately available funds by 11:00 a.m. (New York time) for
Eurodollar Borrowings and 2:00 p.m. (New York time) for Base Rate Borrowings to the Administrative
Agent at the Payment Office; provided, that the Swingline Loans will be made as set forth
in Section 2.4. The Administrative Agent will make such Loans available to the Borrower by
promptly crediting the amounts that it receives, in like funds by the close of business on such
proposed date, to an account maintained by the Borrower with the Administrative Agent or at the
Borrower’s option, by effecting a wire transfer of such amounts to an account designated by the
Borrower to the Administrative Agent.



(b) Unless the Administrative Agent shall have been notified by any Lender (i) for Eurodollar
Borrowings, prior to 5:00 p.m. (New York time) one (1) Business Day prior to the date of such
Eurodollar Borrowing in which such Lender is to participate, and (ii) for Base Rate Borrowings,
promptly and in no event later than 2:00 p.m. (New York time) on the day of such Base Rate
Borrowing in which such Lender is to participate that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume
that such Lender has made such amount available to the Administrative Agent on such date, and the
Administrative Agent, in reliance on
such assumption, may make available to the Borrower on such date a corresponding amount. If
such corresponding amount is not in fact made available to the Administrative Agent by such Lender
on the date of such Borrowing, the Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Lender together with interest at the Federal Funds Rate
until the second Business



 


28









 






Day after such demand and thereafter at the Base Rate. If such Lender
does not pay such corresponding amount forthwith upon the Administrative Agent’s demand therefor,
the Administrative Agent shall promptly notify the Borrower, and the Borrower shall immediately pay
such corresponding amount to the Administrative Agent together with interest at the rate specified
for such Borrowing. Nothing in this subsection shall be deemed to relieve any Lender from its
obligation to fund its Pro Rata Share of any Borrowing hereunder or to prejudice any rights which
the Borrower may have against any Lender as a result of any default by such Lender hereunder.



(c) All Borrowings shall be made by the Lenders on the basis of their respective Pro Rata
Shares. No Lender shall be responsible for any default by any other Lender in its obligations
hereunder, and each Lender shall be obligated to make its Loans provided to be made by it
hereunder, regardless of the failure of any other Lender to make its Loans hereunder.




Section 2.6. Interest Elections.



(a) Each Borrowing initially shall be of the Type specified in the applicable Notice of
Borrowing, and in the case of a Eurodollar Borrowing, shall have an initial Interest Period as
specified in such Notice of Borrowing. Thereafter, the Borrower may elect to convert such Borrowing
into a different Type or to continue such Borrowing, and in the case of a Eurodollar Borrowing, may
elect Interest Periods therefor, all as provided in this Section 2.6. The Borrower may
elect different options with respect to different portions of the affected Borrowing, in which case
each such portion shall be allocated ratably among the Lenders holding Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.
This Section shall NOT apply to Swingline Borrowings, which may not be converted or continued.



(b) To make an election pursuant to this Section 2.6, the Borrower shall give the
Administrative Agent prior written notice (or telephonic notice promptly confirmed in writing) of
each Borrowing substantially in the form of Exhibit 2.6(b) (a “Notice of
Conversion/Continuation”) that is to be converted or continued, as the case may be, (x) prior to
11:00 a.m. (New York time) one (1) Business Day prior to the requested date of a conversion into a
Base Rate Borrowing and (y) prior to 2:00 p.m. (New York time) three (3) Business Days prior to a
continuation of or conversion into a Eurodollar Borrowing. Each such Notice of
Conversion/Continuation shall be irrevocable and shall specify (i) the Borrowing to which such
Notice of Continuation/Conversion applies and if different options are being elected with respect
to different portions thereof, the portions thereof that are to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) shall
be specified for each resulting Borrowing); (ii) the effective date of the election made pursuant
to such Notice of Continuation/Conversion, which shall be a Business Day, (iii) whether the
resulting Borrowing is to be a Base Rate Borrowing or a Eurodollar Borrowing; and (iv) if the
resulting Borrowing is to be a Eurodollar Borrowing, the Interest Period applicable thereto after
giving effect to such election, which shall be a period contemplated by the definition of “Interest
Period”. If any such Notice of Continuation/Conversion requests a Eurodollar Borrowing but does not
specify an Interest Period, the Borrower shall be deemed to have selected an Interest Period of one
month. The principal amount of any resulting Borrowing shall satisfy the minimum borrowing amount
for Eurodollar Borrowings and Base Rate Borrowings set forth in Section 2.3.



(c) If, on the expiration of any Interest Period in respect of any Eurodollar Borrowing, the
Borrower shall have failed to deliver a Notice of Conversion/ Continuation, then, unless such
Borrowing is repaid as provided herein, the Borrower shall be deemed to have elected to convert
such Borrowing to a Base Rate Borrowing. No Borrowing may be converted into, or continued as, a
Eurodollar Borrowing if a Default or an Event of Default exists, unless the Administrative Agent
and




 


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each of the Lenders shall have otherwise consented in writing. No conversion of any
Eurodollar Loans shall be permitted except on the last day of the Interest Period in respect
thereof.



(d) Upon receipt of any Notice of Conversion/Continuation, the Administrative Agent shall
promptly notify each Lender of the details thereof and of such Lender’s portion of each resulting
Borrowing.




Section 2.7. Optional Reduction and Termination of Commitments.



(a) Unless previously terminated, all Revolving Commitments and Swingline Commitments shall
terminate on the Revolving Commitment Termination Date.



(b) Upon at least three (3) Business Days’ prior written notice (or telephonic notice promptly
confirmed in writing) to the Administrative Agent (which notice shall be irrevocable), the Borrower
may reduce the Commitments in part or terminate the Commitments in whole; provided, that
any partial reduction shall apply to reduce proportionately and permanently the Commitment of each
Lender, any partial reduction pursuant to this Section 2.7 shall be in an amount of at
least $1,000,000 and any larger multiple of $250,000, and no such reduction shall be permitted
which would reduce the Revolving Commitments to an amount less than the outstanding Revolving
Credit Exposures of all Lenders. Any such reduction in the Revolving Commitments below the sum of
the principal amount of the Swingline Commitment shall result in a proportionate reduction (rounded
to the next lowest integral multiple of $100,000) in the Swingline Commitment.



(c) With the written approval of the Administrative Agent, the Borrower may terminate (on a
non-ratable basis) the unused amount of the Revolving Commitment of a Defaulting Lender, and in
such event the provisions of Section 2.22 will apply to all amounts thereafter paid by the
Borrower for the account of any such Defaulting Lender under this Agreement (whether on account of
principal, interest, fees, indemnity or other amounts), provided that such termination will not be
deemed to be a waiver or release of any claim the Borrower, the Administrative Agent, the Swingline
Lender or any Lender may have against such Defaulting Lender.




Section 2.8. Repayment of Loans.



(a) The outstanding principal amount of all Revolving Loans shall be due and payable (together
with accrued and unpaid interest thereon) on the Revolving Commitment Termination Date.



(b) The principal amount of each Swingline Borrowing shall be due and payable (together with
accrued and unpaid interest thereon) on the earlier of (i) the last day of the Interest Period
applicable to such Borrowing and (ii) the Revolving Commitment Termination Date.



Section 2.9. Evidence of Indebtedness. (a) Each Lender shall maintain in accordance
with its usual practice appropriate records evidencing the Indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender from time to time, including the amounts of
principal and interest payable thereon and paid to such Lender from time to time under this
Agreement. The Administrative Agent shall maintain appropriate records in which shall be recorded
(i) the Commitment of each Lender, (ii) the amount of each Loan made hereunder by each Lender, the
Class and Type thereof and the Interest Period applicable thereto, (iii) the date of each
continuation thereof pursuant to Section 2.6, (iv) the date of each conversion of all or a
portion thereof to another Type pursuant to Section 2.6, (v) the date and amount of any
principal or interest due and payable or to become due and



 


30









 






payable from the Borrower to each Lender hereunder in respect of such Loans and (vi) both the
date and amount of any sum received by the Administrative Agent hereunder from the Borrower in
respect of the Loans and each Lender’s Pro Rata Share thereof. The entries made in such records
shall be prima facie evidence of the existence and amounts of the obligations of the Borrower
therein recorded; provided, that the failure or delay of any Lender or the Administrative
Agent in maintaining or making entries into any such record or any error therein shall not in any
manner affect the obligation of the Borrower to repay the Loans (both principal and unpaid accrued
interest) of such Lender in accordance with the terms of this Agreement.



(b) This Agreement evidences the obligation of the Borrower to repay the Loans and is being
executed as a “noteless” credit agreement. However, at the request of any Lender (including the
Swingline Lender) at any time, the Borrower agrees that it will prepare, execute and deliver to
such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender,
to such Lender and its registered assigns) and in a form approved by the Administrative Agent and
reasonably acceptable to the Borrower. Thereafter, the Loans evidenced by such promissory note and
interest thereon shall at all times (including after assignment permitted hereunder) be represented
by one or more promissory notes in such form payable to the order of the payee named therein (or,
if such promissory note is a registered note, to such payee and its registered assigns).




Section 2.10. Prepayments



(a) The Borrower shall have the right at any time and from time to time to prepay any
Borrowing, in whole or in part, without premium or penalty, by giving irrevocable written notice
(or telephonic notice promptly confirmed in writing) to the Administrative Agent no later than (i)
in the case of prepayment of any Eurodollar Borrowing, 2:00 p.m. (New York time) not less than
three (3) Business Days prior to any such prepayment, or (ii) in the case of any prepayment of any
Base Rate Borrowing, 11:00 a.m. on the same day of such prepayment. Each such notice shall be
irrevocable and shall specify the proposed date of such prepayment and the principal amount of each
Borrowing or portion thereof to be prepaid. Upon receipt of any such notice, the Administrative
Agent shall promptly notify each affected Lender of the contents thereof and of such Lender’s Pro
Rata Share of any such prepayment. If such notice is given, the aggregate amount specified in such
notice shall be due and payable on the date designated in such notice, together with accrued
interest to such date on the amount so prepaid in accordance with Section 2.11(d);
provided, that if a Eurodollar Borrowing is prepaid on a date other than the last day of an
Interest Period applicable thereto, the Borrower shall also pay all amounts required pursuant to
Section 2.17. Each partial prepayment of any Loan (other than a Swingline Loan) shall be
in an amount that would be permitted in the case of an advance of a Borrowing of the same Type
pursuant to Section 2.2 or in the case of a Swingline Loan pursuant to Section 2.4.
Each prepayment of a Borrowing shall be applied ratably to the Loans comprising such Borrowing.



(b) If at any time the Revolving Credit Exposure of all Lenders exceeds the Aggregate
Commitment Amount, as reduced pursuant to Section 2.7 or otherwise, the Borrower shall
immediately repay Swingline Loans and Revolving Loans in an amount equal to such excess, together
with all accrued and unpaid interest on such excess amount and any amounts due under Section
2.17. Each prepayment shall be applied first to the Swingline Loans to the full extent
thereof, second to the Base Rate Loans to the full extent thereof, and finally to Eurodollar Loans
to the full extent thereof.



(c) In the event that at any time any Borrowing Base Deficiency shall exist, the Borrower
shall prepay the Loans in such amounts as shall be necessary so that such Borrowing Base Deficiency
is immediately cured.


 


31









 





(d) In the event that at any time the Borrower or any of its Subsidiaries shall change or
modify in any material respect the Investment Objectives without the consent of the Required
Lenders, the Borrower shall prepay the Loans then outstanding in full, together with accrued
interest thereon and all fees and other Obligations of the Borrower accrued hereunder.




Section 2.11. Interest on Loans.



(a) The Borrower shall pay interest on each Base Rate Loan at the Base Rate in effect from
time to time and on each Eurodollar Loan at the Adjusted LIBO Rate for the applicable Interest
Period in effect for such Loan, plus, in each case, the Applicable Margin in effect from time to
time.




(b) The Borrower shall pay interest on each Swingline Loan at the Base Rate plus the
Applicable Margin in effect from time to time.




(c) While an Event of Default exists or after acceleration, at the option of the
Required Lenders, the Borrower shall pay interest (“Default Interest”) with respect to all
Eurodollar Loans at the rate otherwise applicable for the then-current Interest Period plus
an additional 2% per annum until the last day of such Interest Period, and thereafter, and
with respect to all Base Rate Loans and all other Obligations hereunder (other than Loans),
at the rate in effect for Base Rate Loans, plus an additional 2% per annum.



(d) Interest on the principal amount of all Loans shall accrue from and including the date
such Loans are made to but excluding the date of any repayment thereof. Interest on all outstanding
Base Rate Loans shall be payable quarterly in arrears on the last day of each March, June,
September and December and on the Revolving Commitment Termination Date. Interest on all
outstanding Eurodollar Loans shall be payable on the last day of each Interest Period applicable
thereto, and, in the case of any Eurodollar Loans having an Interest Period in excess of three
months or 90 days, respectively, on each day which occurs every three months or 90 days, as the
case may be, after the initial date of such Interest Period, and on the Revolving Commitment
Termination Date. Interest on each Swingline Loan shall be payable on the maturity date of such
Loan, which shall be the last day of the Interest Period applicable thereto and on the Revolving
Commitment Termination Date. Interest on any Loan which is converted into a Loan of another Type
or which is repaid or prepaid shall be payable on the date of such conversion or on the date of any
such repayment or prepayment (on the amount repaid or prepaid) thereof. All Default Interest shall
be payable on demand.



(e) The Administrative Agent shall determine each interest rate applicable to the Loans
hereunder and shall promptly notify the Borrower and the Lenders of such rate in writing (or by
telephone, promptly confirmed in writing). Any such determination shall be conclusive and binding
for all purposes, absent manifest error.




Section 2.12. Fees.



(a) The Borrower shall pay to the Administrative Agent for its own account fees in the amounts
and at the times previously agreed upon by the Borrower and the Administrative Agent.



(b) The Borrower agrees to pay to the Administrative Agent for the account of each Lender a
commitment fee, which shall accrue at the Applicable Percentage per annum on the daily amount of
the unused Commitment of such Lender during the Availability Period. For purposes of



 


32









 






computing commitment fees with respect to the Commitments, the Commitment of each Lender shall
be deemed used to the extent of the outstanding Loans, but not Swingline Exposure, of such Lender.



(c) On the Closing Date, the Borrower shall pay to the Administrative Agent for its own
account fees in the amounts and at the times previously agreed upon in writing by the Borrower and
the Administrative Agent.



(d) Accrued fees (other than the fees referenced in paragraphs (c) and (d)) shall be payable
quarterly in arrears on the last day of each March, June, September and December, commencing on
September 30, 2007 and on the Revolving Commitment Termination Date (and if later, the date the
Loans shall be repaid in their entirety); provided further, that any such fees
accruing after the Revolving Commitment Termination Date shall be payable on demand.



(e) Notwithstanding anything herein to the contrary, during such period as a Lender is a
Defaulting Lender, such Defaulting Lender will not be entitled to commitment fees accruing with
respect to its Revolving Commitment during such period pursuant to Section 2.12(b) (without
prejudice to the rights of the Lenders other than Defaulting Lenders in respect of such fees).




Section 2.13. Computation of Interest and Fees.



All computations of interest and fees hereunder shall be made on the basis of a year of
360 days for the actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or fees are payable (to the extent computed on the
basis of days elapsed). Each determination by the Administrative Agent of an interest amount or
fee hereunder shall be made in good faith and, except for manifest error, shall be final,
conclusive and binding for all purposes.



Section 2.14. Inability to Determine Interest Rates. If prior to the commencement of
any Interest Period for any Eurodollar Borrowing,




(i) the Administrative Agent shall have determined (which determination shall be
conclusive and binding upon the Borrower) that, by reason of circumstances affecting the
relevant interbank market, adequate means do not exist for ascertaining LIBOR for such
Interest Period, or




(ii) the Administrative Agent shall have received notice from the Required Lenders that
the Adjusted LIBO Rate does not adequately and fairly reflect the cost to such Lenders (or
Lender, as the case may be) of making, funding or maintaining their (or its, as the case may
be) Eurodollar Loans for such Interest Period,



the Administrative Agent shall give written notice (or telephonic notice, promptly confirmed in
writing) to the Borrower and to the Lenders as soon as practicable thereafter. Until the
Administrative Agent shall notify the Borrower and the Lenders that the circumstances giving rise
to such notice no longer exist, (i) the obligations of the Lenders to make Eurodollar Loans or to
continue or convert outstanding Loans as or into Eurodollar Loans shall be suspended and (ii) all
such affected Loans shall be converted into Base Rate Loans on the last day of the then current
Interest Period applicable thereto unless the Borrower prepays such Loans in accordance with this
Agreement. Unless the Borrower notifies the Administrative Agent at least one Business Day before
the date of any Eurodollar Borrowing for which a Notice of Borrowing has previously been given that
it elects not to borrow on such date, then such Borrowing shall be made as a Base Rate Borrowing.


 


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Section 2.15. Illegality. If any Change in Law shall make it unlawful or impossible
for any Lender to make, maintain or fund any Eurodollar Loan and such Lender shall so notify the
Administrative Agent, the Administrative Agent shall promptly give notice thereof to the Borrower
and the other Lenders, whereupon until such Lender notifies the Administrative Agent and the
Borrower that the circumstances giving rise to such suspension no longer exist, the obligation of
such Lender to make Eurodollar Loans, or to continue or convert outstanding Loans as or into
Eurodollar Loans, shall be suspended. In the case of the making of a Eurodollar Borrowing, such
Lender’s Loan shall be made as a Base Rate Loan as part of the same Borrowing for the same Interest
Period and if the affected Eurodollar Loan is then outstanding, such Loan shall be converted to a
Base Rate Loan either (i) on the last day of the then current Interest Period applicable to such
Eurodollar Loan if such Lender may lawfully continue to maintain such Loan to such date or (ii)
immediately if such Lender shall determine that it may not lawfully continue to maintain such
Eurodollar Loan to such date. Notwithstanding the foregoing, the affected Lender shall, prior to
giving such notice to the Administrative Agent, designate a different Applicable Lending Office if
such designation would avoid the need for giving such notice and if such designation would not
otherwise be disadvantageous to such Lender in the good faith exercise of its discretion.




Section 2.16. Increased Costs.




(a) If any Change in Law shall:




(i) impose, modify or deem applicable any reserve, special deposit or similar
requirement that is not otherwise included in the determination of the Adjusted LIBO Rate
hereunder against assets of, deposits with or for the account of, or credit extended by, any
Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate); or




(ii) impose on any Lender or the eurodollar interbank market any other condition
affecting this Agreement or any Eurodollar Loans made by such Lender or any participation
therein;



and the result of either of the foregoing is to increase the cost to such Lender of making,
converting into, continuing or maintaining a Eurodollar Loan or to reduce the amount received or
receivable by such Lender hereunder (whether of principal, interest or any other amount), then the
Borrower shall promptly pay, upon written notice from and demand by such Lender on the Borrower
(with a copy of such notice and demand to the Administrative Agent), to the Administrative Agent
for the account of such Lender, within five Business Days after the date of such notice and demand,
additional amount or amounts sufficient to compensate such Lender for such additional costs
incurred or reduction suffered.



(b) If any Lender shall have determined that on or after the date of this Agreement any Change
in Law regarding capital requirements has or would have the effect of reducing the rate of return
on such Lender’s capital (or on the capital of such Lender’s Parent Company) as a consequence of
its obligations hereunder to a level below that which such Lender or such Lender’s Parent Company
could have achieved but for such Change in Law (taking into consideration such Lender’s policies or
the policies of such Lender’s Parent Company with respect to capital adequacy) then, from time to
time, within five (5) Business Days after receipt by the Borrower of written demand by such Lender
(with a copy thereof to the Administrative Agent), the Borrower shall pay to such Lender such
additional amounts as will compensate such Lender or such Lender’s Parent Company for any such
reduction suffered.


 


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(c) A certificate of a Lender setting forth the amount or amounts necessary to compensate such
Lender or such Lender’s Parent Company, as the case may be, specified in paragraph (a) or (b) of
this Section 2.16 shall be delivered to the Borrower (with a copy to the Administrative
Agent) and shall be conclusive, absent manifest error. The Borrower shall pay any such Lender, as
the case may be, such amount or amounts within five (5) Business Days after receipt thereof.



(d) Failure or delay on the part of any Lender to demand compensation pursuant to this
Section 2.16 shall not constitute a waiver of such Lender’s right to demand such
compensation.



Section 2.17. Funding Indemnity. In the event of (a) the payment of any principal of
a Eurodollar Loan other than on the last day of the Interest Period applicable thereto (including
as a result of an Event of Default), (b) the conversion or continuation of a Eurodollar Loan other
than on the last day of the Interest Period applicable thereto, or (c) the failure by the Borrower
to borrow, prepay, convert or continue any Eurodollar Loan on the date specified in any applicable
notice (regardless of whether such notice is withdrawn or revoked), then, in any such event, the
Borrower shall compensate each Lender, within five (5) Business Days after written demand from such
Lender, for any loss, cost or expense attributable to such event. In the case of a Eurodollar
Loan, such loss, cost or expense shall be deemed to include an amount determined by such Lender to
be the excess, if any, of (A) the amount of interest that would have accrued on the principal
amount of such Eurodollar Loan if such event had not occurred at the Adjusted LIBO Rate applicable
to such Eurodollar Loan for the period from the date of such event to the last day of the then
current Interest Period therefor (or in the case of a failure to borrow, convert or continue, for
the period that would have been the Interest Period for such Eurodollar Loan) over (B) the amount
of interest that would accrue on the principal amount of such Eurodollar Loan for the same period
if the Adjusted LIBO Rate were set on the date such Eurodollar Loan was prepaid or converted or the
date on which the Borrower failed to borrow, convert or continue such Eurodollar Loan. A
certificate as to any additional amount payable under this Section 2.17 submitted to the
Borrower by any Lender (with a copy to the Administrative Agent) shall be conclusive, absent
manifest error.




Section 2.18. Taxes.



(a) Any and all payments by or on account of any obligation of the Borrower hereunder shall be
made free and clear of and without deduction for any Indemnified Taxes or Other Taxes;
provided, that if the Borrower shall be required to deduct any Indemnified Taxes or Other
Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional sums payable under
this Section 2.18) the Administrative Agent, any Lender shall receive an amount equal to
the sum it would have received had no such deductions been made, (ii) the Borrower shall make such
deductions and (iii) the Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.



(b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority
in accordance with applicable law.



(c) The Borrower shall indemnify the Administrative Agent and each Lender, within five (5)
Business Days after written demand therefor, for the full amount of any Indemnified Taxes or Other
Taxes paid by the Administrative Agent, such Lender on or with respect to any payment by or on
account of any obligation of the Borrower hereunder (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under Section 2.18) and any
penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. A



 


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certificate as to the amount of such payment or liability delivered to the Borrower by a
Lender, or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be
conclusive absent manifest error.



(d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the
Borrower to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the
original or a certified copy of a receipt issued by such Governmental Authority evidencing such
payment, a copy of the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.



(e) Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax
under the Code or any treaty to which the United States is a party, with respect to payments under
this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time
or times prescribed by applicable law, such properly completed and executed documentation
prescribed by applicable law or reasonably requested by the Borrower as will permit such payments
to be made without withholding or at a reduced rate. Without limiting the generality of the
foregoing, each Foreign Lender agrees that it will deliver to the Administrative Agent and the
Borrower (or in the case of a Participant, to the Lender from which the related participation shall
have been purchased), as appropriate, two (2) duly completed copies of (i) Internal Revenue Service
Form W-8 ECI, or any successor form thereto, certifying that the payments received from the
Borrower hereunder are effectively connected with such Foreign Lender’s conduct of a trade or
business in the United States; or (ii) Internal Revenue Service Form W-8 BEN, or any successor form
thereto, certifying that such Foreign Lender is entitled to benefits under an income tax treaty to
which the United States is a party which reduces the rate of withholding tax on payments of
interest; or (iii) Internal Revenue Service Form W-8 BEN, or any successor form prescribed by the
Internal Revenue Service, together with a certificate (A) establishing that the payment to the
Foreign Lender qualifies as “portfolio interest” exempt from U.S. withholding tax under Code
section 871(h) or 881(c), and (B) stating that (1) the Foreign Lender is not a bank for purposes of
Code section 881(c)(3)(A), or the obligation of the Borrower hereunder is not, with respect
to such Foreign Lender, a loan agreement entered into in the ordinary course of its trade or
business, within the meaning of that Section; (2) the Foreign Lender is not a 10% shareholder of
the Borrower within the meaning of Code section 871(h)(3) or 881(c)(3)(B); and (3) the Foreign
Lender is not a controlled foreign corporation that is related to the Borrower within the meaning
of Code section 881(c)(3)(C); or (iv) such other Internal Revenue Service forms as may be
applicable to the Foreign Lender, including Forms W-8 IMY or W-8 EXP. Each such Foreign Lender
shall deliver to the Borrower and the Administrative Agent such forms on or before the date that it
becomes a party to this Agreement (or in the case of a Participant, on or before the date such
Participant purchases the related participation). In addition, each such Foreign Lender shall
deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by
such Foreign Lender. Each such Foreign Lender shall promptly notify the Borrower and the
Administrative Agent at any time that it determines that it is no longer in a position to provide
any previously delivered certificate to the Borrower (or any other form of certification adopted by
the Internal Revenue Service for such purpose).




Section 2.19. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.



(a) The Borrower shall make each payment required to be made by it hereunder (whether of
principal, interest, fees, or of amounts payable under Section 2.16, 2.17 or
2.18, or otherwise) prior to 12:00 noon (New York time), on the date when due, in
immediately available funds, free and clear of any defenses, rights of set-off, counterclaim or
withholding or deduction of taxes. Any amounts received after such time on any date may, in the
discretion of the Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All



 


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such payments shall be made to the Administrative Agent at the Payment Office, except payments
to be made directly to the Swingline Lender as expressly provided herein and except that payments
pursuant to Sections 2.16, 2.17 and 2.18 and 10.3 shall be made
directly to the Persons entitled thereto. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to the appropriate recipient promptly
following receipt thereof. If any payment hereunder shall be due on a day that is not a Business
Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case
of any payment accruing interest, interest thereon shall be made payable for the period of such
extension. All payments hereunder shall be made in Dollars.



(b) If at any time insufficient funds are received by and available to the Administrative
Agent to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall
be applied: first, to Administrative Agent’s fees and reimbursable expenses then due and
payable pursuant to any of the Loan Documents; second, to all reimbursable expenses of the
Lenders then due and payable pursuant to any of the Loan Documents, pro rata to the Lenders based
on their respective pro rata shares of such fees and expenses; and third, to interest and
fees then due and payable hereunder, pro rata to the Lenders based on their respective pro rata
shares of such interest and fees; and fourth, to the payment of principal of the Loans then
due hereunder, ratably among the parties entitled thereto in accordance with the amounts of
principal then due to such parties.



(c) If any Lender shall, by exercising any right of set-off or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its Loans or participations in
Swingline Loans that would result in such Lender receiving payment of a greater proportion of the
aggregate amount of its Loans and participations in Swingline Loans and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such greater proportion
shall purchase (for cash at face value) participations in the Loans and participations in Swingline
Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be
shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued
interest on their respective Loans and participations in Swingline Loans; provided, that
(i) if any such participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase price restored to the
extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be
construed to apply to any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations in Swingline Loans
to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof
(as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing
and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring
a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of
set-off and counterclaim with respect to such participation as fully as if such Lender were a
direct creditor of the Borrower in the amount of such participation.



(d) Unless the Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Administrative Agent for the account of the Lenders
hereunder that the Borrower will not make such payment, the Administrative Agent may assume that
the Borrower has made such payment on such date in accordance herewith and may, in reliance upon
such assumption, distribute to the Lenders the amount or amounts due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to such Lender with interest
thereon, for each day from and including the date such amount is distributed to it to but excluding
the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a
rate determined by the Administrative Agent in accordance with banking industry rules on interbank
compensation.


 


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(e) Notwithstanding anything herein to the contrary, any amount paid by the Borrower for the
account of a Defaulting Lender under this Agreement (whether on account of principal, interest,
fees, indemnity payments or other amounts) will be retained by the Administrative Agent in a
segregated non-interest bearing account until the termination of the Revolving Commitments at which
time the funds in such account will be applied by the Administrative Agent, to the fullest extent
permitted by law, in the following order of priority: first to the payment of any amounts
owing by such Defaulting Lender to the Administrative Agent under this Agreement, second to
the payment of any amounts owing by such Defaulting Lender to the Swingline Lender under this
Agreement, third to the payment of post-default interest and then current interest due and
payable to the Lenders hereunder other than Defaulting Lenders, ratably among them in accordance
with the amounts of such interest then due and payable to them, fourth to the payment of
fees then due and payable to the Non-Defaulting Lenders hereunder, ratably among them in accordance
with the amounts of such fees then due and payable to them, fifth to pay principal then due
and payable to the Non-Defaulting Lenders hereunder ratably in accordance with the amounts thereof
then due and payable to them, sixth to the ratable payment of other amounts then due and
payable to the Non-Defaulting Lenders, and seventh to pay amounts owing under this
Agreement to such Defaulting Lender or as a court of competent jurisdiction may otherwise direct;
provided, however, that, notwithstanding the foregoing, in the event that the
Obligations are accelerated and the Administrative Agent receives proceeds from realization upon
the Collateral, such Defaulting Lender shall be able to receive payments on a pro rata basis with
the Non-Defaulting Lenders as provided for in clauses “third” and “fifth” above. 




Section 2.20. Increase of Commitments; Additional Lenders.



(a) So long as no Event of Default has occurred and is continuing, from time to time after the
Closing Date, the Borrower may, upon at least 30 days’ written notice to the Administrative Agent
(who shall promptly provide a copy of such notice to each Lender), propose to increase the
Revolving Commitments to an amount not to exceed $150,000,000 (the amount of any such increase, the
“Additional Commitment Amount”). Each Lender shall have the right for a period of 15 days
following receipt of such notice, to elect by written notice to the Borrower and the Administrative
Agent to increase its Revolving Commitment by a principal amount equal to its Pro Rata Share of the
Additional Commitment Amount. No Lender (or any successor thereto) shall have any obligation to
increase its Revolving Commitment or its other obligations under this Agreement and the other Loan
Documents, and any decision by a Lender to increase its Revolving Commitment shall be made in its
sole discretion independently from any other Lender.



(b) If any Lender shall not elect to increase its Revolving Commitment pursuant to subsection
(a) of this Section 2.21, the Borrower may designate another bank or other financial
institution (which may be, but need not be, one or more of the existing Lenders) which at the time
agrees to, in the case of any such Person that is an existing Lender, increase its Revolving
Commitment and in the case of any other such Person (an “Additional Lender”), become a party to
this Agreement; provided, however, that any new bank or financial institution must
be reasonably acceptable to the Administrative Agent, which acceptance will not be unreasonably
withheld or delayed. The sum of the increases in the Revolving Commitments of the existing Lenders
pursuant to this subsection (b) plus the Revolving Commitments of the Additional Lenders shall not
in the aggregate exceed the unsubscribed amount of the Additional Commitment Amount.



(c) An increase in the aggregate amount of the Revolving Commitments pursuant to this
Section 2.21 shall become effective upon the receipt by the Administrative Agent of an
supplement or joinder in form and substance satisfactory to the Administrative Agent executed by
the Borrower, by each Additional Lender and by each other Lender whose Revolving Commitment is to
be increased, setting



 


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forth the new Revolving Commitments of such Lenders and setting forth the agreement of each
Additional Lender to become a party to this Agreement and to be bound by all the terms and
provisions hereof, together with Revolving Notes evidencing such increase in the Revolving
Commitments, and such evidence of appropriate corporate authorization on the part of the Borrower
with respect to the increase in the Revolving Commitments and such opinions of counsel for the
Borrower with respect to the increase in the Revolving Commitments as the Administrative Agent may
reasonably request.



(d) Upon the acceptance of any such supplement or joinder by the Administrative Agent, the
Revolving Commitment Amount shall automatically be increased by the amount of the Revolving
Commitments added through such supplement or joinder and Schedule I shall automatically be
deemed amended to reflect the Revolving Commitments of all Lenders after giving effect to the
addition of such Revolving Commitments.



(e) Upon any increase in the aggregate amount of the Revolving Commitments pursuant to this
Section 2.20 that is not pro rata among all Lenders, within five Business Days, in the case
of any Base Rate Loans then outstanding, and at the end of the then current Interest Period with
respect thereto, in the case of any Eurodollar Loans then outstanding, the Borrower shall prepay
such Loans in their entirety and, to the extent the Borrower elects to do so and subject to the
conditions specified in Article III, the Borrower shall reborrow Loans from the Lenders in
proportion to their respective Revolving Commitments after giving effect to such increase, until
such time as all outstanding Loans are held by the Lenders in proportion to their respective
Commitments after giving effect to such increase.



Section 2.21. Mitigation of Obligations. If any Lender requests compensation under
Section 2.16, or if the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section 2.18, then
such Lender shall use reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the sole judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable under Section 2.16 or Section
2.18, as the case may be, in the future and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The
Borrower hereby agrees to pay all costs and expenses incurred by any Lender in connection with such
designation or assignment.



Section 2.22. Replacement of Lenders. If any Lender requests compensation under
Section 2.16, or if the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority of the account of any Lender pursuant to Section 2.18, or if any
Lender is a Defaulting Lender, then the Borrower may, at its sole expense and effort, upon notice
to such Lender and the Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions set forth in Section 10.4(b))
all its interests, rights and obligations under this Agreement to an assignee that shall assume
such obligations (which assignee may be another Lender); provided, that (i) the Borrower
shall have received the prior written consent of the Administrative Agent, which consent shall not
be unreasonably withheld, (ii) such Lender shall have received payment of an amount equal to the
outstanding principal amount of all Loans owed to it, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (in the case of such outstanding
principal and accrued interest) and from the Borrower (in the case of all other amounts), (iii) in
the case of a claim for compensation under Section 2.16 or payments required to be made
pursuant to Section 2.18, such assignment will result in a reduction in such compensation
or payments and (iv) such assignment does not conflict with applicable Requirements of Law. A
Lender shall not be required to make any such assignment and delegation if, prior thereto, as a
result of a waiver



 


39









 






by such Lender or otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.



Section 2.23. Reallocation and Cash Collateralization of Defaulting Lender or Potential
Defaulting Lender Commitment.



(a) If a Lender becomes, and during the period it remains, a Defaulting Lender or Potential
Defaulting Lender, the following provisions shall apply, notwithstanding anything to the contrary
in this Agreement:




(1) the Swingline Exposure of such Defaulting Lender will,
subject to the limitation in the first proviso below, automatically
be reallocated (effective on the day such Lender becomes a
Defaulting Lender) among the Non-Defaulting Lenders pro
rata in accordance with their respective Revolving
Commitments; provided that (a) the sum of each
Non-Defaulting Lender’s total Revolving Credit Exposure may not in
any event exceed the Revolving Commitment of such Non-Defaulting
Lender as in effect at the time of such reallocation and (b) neither
such reallocation nor any payment by a Non-Defaulting Lender
pursuant thereto will constitute a waiver or release of any claim
the Borrower, the Administrative Agent, the Swingline Lender or any
other Lender may have against such Defaulting Lender or cause such
Defaulting Lender to be a Non-Defaulting Lender;




(2) to the extent that any portion (the “unreallocated
portion”) of the Swingline Exposure of any Defaulting Lender cannot
be so reallocated, for any reason, or with respect to the Swingline
Exposure of any Potential Defaulting Lender, the Borrower will, not
later than two (2) Business Days after demand by the Administrative
Agent (at the direction of the Swingline Lender), (a) Cash
Collateralize the obligations of the Borrower to the Swingline
Lender in respect of such Swingline Exposure in an amount at least
equal to the aggregate amount of the unreallocated portion of the
Swingline Exposure of such Defaulting Lender or the Swingline
Exposure of such Potential Defaulting Lender, or (b) in the case of
such Swingline exposure, prepay (subject to clause (4) below) and/or
Cash Collateralize in full the unreallocated portion thereof, or (c)
make other arrangements satisfactory to the Administrative Agent and
the Swingline Lender in their sole discretion to protect them
against the risk of non-payment by such Defaulting Lender or
Potential Defaulting Lender;



(b) If the Borrower, the Administrative Agent and the Swingline Lender agree in writing in
their discretion that a Lender that is a Defaulting Lender or a Potential Defaulting Lender should
no longer be deemed to be a Defaulting Lender or Potential Defaulting Lender, as the case may be,
the Administrative Agent will so notify the parties hereto, whereupon as of the effective date
specified in such notice and subject to any conditions set forth therein, the Swingline Exposure of
the other Lenders shall be readjusted to reflect the inclusion of such Lender’s Commitment, and
such Lender will purchase at par such portion of outstanding Revolving Loans of the other Lenders
and/or make such other adjustments as the Administrative Agent may determine to be necessary to
cause the Revolving Credit



 


40









 






Exposure of the Lenders to be on a pro rata basis in accordance with their
respective Revolving Commitments, whereupon such Lender will cease to be a Defaulting Lender or
Potential Defaulting Lender and will be a Non-Defaulting Lender (and such Revolving Credit Exposure
of each Lender will automatically be adjusted on a prospective basis to reflect the foregoing) and
if any cash collateral has been posted with respect to such Defaulting Lender or Potential
Defaulting Lender, the Administrative Agent will promptly return such cash collateral to the
Borrower; provided that no adjustments will be made retroactively with respect to fees
accrued or payments made by or on behalf of the Borrower while such Lender was a Defaulting Lender;
and provided, further, that except to the extent otherwise expressly agreed by the affected
parties, no change hereunder from Defaulting Lender or Potential Defaulting Lender to
Non-Defaulting Lender will constitute a waiver or release of any claim of any party hereunder
arising from such Lender’s having been a Defaulting Lender or Potential Defaulting Lender.



ARTICLE III




CONDITIONS PRECEDENT TO LOANS




Section 3.1. Conditions To Effectiveness. The amendment and restatement of the
Existing Credit Agreement as provided herein, and the obligations of the Lenders (including the
Swingline Lender) to make Loans hereunder shall not become effective until the date on which each
of the following conditions is satisfied (or waived in accordance with Section 10.2). The
Administrative Agent and the Borrower shall execute a notice confirming the satisfaction of such
conditions and the occurrence of the Closing Date.



(a) The Administrative Agent shall have received all fees and other amounts due and payable on
or prior to the Closing Date, including reimbursement or payment of all out-of-pocket expenses
(including reasonable fees, charges and disbursements of counsel to the Administrative Agent)
required to be reimbursed or paid by the Borrower hereunder, under any other Loan Document and
under any agreement with the Administrative Agent or SunTrust Robinson Humphrey, Inc., as Arranger.



(b) The Administrative Agent shall have completed and be satisfied with all due diligence with
respect to the Borrower and its Subsidiaries, including but not limited to review of the Investment
Objectives, risk management procedures, accounting policies, systems integrity, compliance,
management and organizational structure, and the loan and investment portfolio of the Borrower and
its Subsidiaries;




(c) The Administrative Agent (or its counsel) shall have received the following:




(i) a counterpart of this Agreement signed by or on behalf of each party hereto or
written evidence satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page of this Agreement) that such party has signed a
counterpart of this Agreement;




(ii) duly executed originals of each Control Agreement with respect to all Collateral
Accounts, Clearing Accounts, deposit accounts, securities, securities entitlements, other
financial assets held with any financial institution other than Administrative Agent or its
affiliates (other than the Approved Brokerage Accounts);




(iii) the duly executed Security Agreement, together with (A) UCC financing statements
and other applicable documents under the laws of the jurisdictions with respect to the
perfection of the Liens granted under the Security Agreement, as requested by the
Administrative


 


41









 






Agent in order to perfect such Liens, (B) copies of favorable UCC, tax, judgment and
fixture lien search reports in all necessary or appropriate jurisdictions and under all
legal and trade names of the Borrower and the Subsidiary Guarantors requested by the
Lenders, indicating that there are no prior Liens on any of the Collateral other than
Permitted Encumbrances, and (C) a Perfection Certificate duly completed and executed by the
Borrower;




(iv) [reserved];




(v) a certificate of the Secretary or Assistant Secretary of each Loan Party in the
form of Exhibit 3.1(c)(v), attaching and certifying copies of its bylaws and of the
resolutions of its board of directors, or partnership agreement or limited liability company
agreement, or comparable organizational documents and authorizations, authorizing the
execution, delivery and performance of the Loan Documents to which it is a party and
certifying the name, title and true signature of each officer of such Loan Party executing
the Loan Documents to which it is a party;




(vi) certified copies of the articles or certificate of incorporation, certificate of
organization or limited partnership, or other registered organizational documents of each
Loan Party, together with certificates of good standing or existence, as may be available
from the Secretary of State of the jurisdiction of organization of such Loan Party and each
other jurisdiction where such Loan Party is required to be qualified to do business as a
foreign corporation;




(vii) a favorable written opinion of Paul, Hastings, Janofsky & Walker, counsel to the
Loan Parties, addressed to the Administrative Agent and each of the Lenders, and covering
such matters relating to the Loan Parties, the Loan Documents and the transactions
contemplated therein as the Administrative Agent or the Required Lenders shall reasonably
request;




(viii) a certificate in the form of Exhibit 3.1(c)(viii), dated the Closing
Date and signed by a Responsible Officer, certifying that (x) no Default or Event of Default
exists, (y) all representations and warranties of each Loan Party set forth in the Loan
Documents are true and correct and (z) since the date of the financial statements of the
Borrower described in Section 4.4, there shall have been no change which has had or
could reasonably be expected to have a Material Adverse Effect;




(ix) a duly executed Notice of Borrowing;




(x) a duly executed Federal Reserve Form U-1, executed by the Borrower and the
Administrative Agent on behalf of each Lender;




(xi) a duly executed funds disbursement agreement, together with a report setting forth
the sources and uses of the proceeds hereof;




(xii) a duly completed and executed certificate of the type described in Section
5.1(c) including calculations of the financial covenants set forth in Article VI
hereof as of February 28, 2010;




(xiii) certified copies of all consents, approvals, authorizations, registrations and
filings and orders required or advisable to be made or obtained under any Requirement of
Law, or by any Contractual Obligation of each Loan Party, in connection with the execution,
delivery, performance, validity and enforceability of the Loan Documents or any of the
transactions


 


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contemplated thereby, and such consents, approvals, authorizations, registrations,
filings and orders shall be in full force and effect and all applicable waiting periods
shall have expired, and no investigation or inquiry by any governmental authority regarding
the Commitments or any transaction being financed with the proceeds thereof shall be
ongoing;




(xiv) copies of the audited consolidated financial statements for Borrower and its
Subsidiaries for the Fiscal Year ending November 30, 2009;




(xv) a duly completed and executed Borrowing Base Certificate as of two days prior to
the Closing Date;




(xvi) certified copies of all agreements, indentures or notes governing the terms of
any Material Indebtedness and all other material agreements, documents and instruments to
which any Loan Party is a party or by which any of its assets are bound;




(xvii) certificates of insurance, in form and detail acceptable to the Administrative
Agent, describing the types and amounts of insurance (property and liability) covering any
of the tangible insurable Collateral maintained by the Loan Parties, in each case naming the
Administrative Agent as additional insured and loss payee, as appropriate;




(xviii) the Administrative Agent shall have reviewed and be satisfied with the
Borrower’s compliance with underwriting policies for the Fiscal Quarter ended November 30,
2009 and prior to the Closing Date and shall have completed a satisfactory review of third
party valuation reports prepared on behalf of the Borrower for the Fiscal Quarter ended
November 30, 2009; and




(xix) the Administrative Agent shall have reviewed and approved, in its reasonable
discretion, the valuations for all Private MLP Common and Preferred Units.



Without limiting the generality of the provisions of Section 3.1, for purposes of
determining compliance with the conditions specified in this Section 3.1, each Lender that
has signed this Credit Agreement shall be deemed to have consented to, approved or accepted or to
be satisfied with, each document or other matter required thereunder to be consented to or approved
by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its objection thereto.



Section 3.2. Each Credit Event. The obligation of each Lender to make a Loan on the
occasion of any Borrowing is subject to the satisfaction of the following conditions:



(a) at the time of and immediately after giving effect to such Borrowing, no Default or Event
of Default shall exist;



(b) at the time of and immediately after giving effect to such Borrowing, all representations
and warranties of each Loan Party set forth in the Loan Documents shall be true and correct in all
material respects on and as of the date of such Borrowing, in each case before and after giving
effect thereto;



(c) the Borrower shall have delivered the required Notice of Borrowing;


 


43









 





(d) the Borrower shall have delivered a duly executed update or amendment to the Federal
Reserve Form U-1 delivered on the Closing Date, executed by the Borrower and the Administrative
Agent on behalf of each Lender; and



(e) the Administrative Agent shall have received such other documents, certificates,
information or legal opinions as the Administrative Agent or the Required Lenders may reasonably
request, all in form and substance reasonably satisfactory to the Administrative Agent or the
Required Lenders.



In addition to other conditions precedent herein set forth, if any Lender is a Defaulting
Lender or a Potential Defaulting Lender at the time of and immediately after giving effect to such
Borrowing the Swingline Lender will not be required to make any Swingline Loans, unless they are
satisfied that 100% of the related Swingline Exposure is fully covered or eliminated by any
combination satisfactory to the Swingline Lender of the following:




(i) in the case of a Defaulting Lender, the Swingline
Exposure of such Defaulting Lender is reallocated to the
Non-Defaulting Lenders as provided in Section 2.23(a)(1)
above; and




(ii) in the case of a Defaulting Lender or a Potential
Defaulting Lender, without limiting the provisions of
Section 2.23(a)(2) above, the Borrower Cash
Collateralizes the obligations of the Borrower in respect of
such Swingline Loan in an amount at least equal to the aggregate
amount of the unreallocated obligations (contingent or
otherwise) of such Defaulting Lender or Potential Defaulting
Lender in respect of such Swingline Loan, or the Borrower makes
other arrangements satisfactory to the Administrative Agent and
the Swingline Lender, as the case may be, in their sole
discretion to protect them against the risk of non-payment by
such Defaulting Lender or Potential Defaulting Lender;



provided that (a) the sum of each Non-Defaulting Lender’s total Revolving Credit
Exposure may not in any event exceed the Revolving Commitment of such Non-Defaulting Lender, and
(b) neither any such reallocation nor any payment by a Non-Defaulting Lender pursuant thereto nor
any such Cash Collateralization or reduction will constitute a waiver or release of any claim the
Borrower, the Administrative Agent the Swingline Lender or any other Lender may have against such
Defaulting Lender or Potential Defaulting Lender, or cause such Defaulting Lender or Potential
Defaulting Lender to be a Non-Defaulting Lender.



Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower on
the date thereof as to the matters specified in paragraphs (a), (b) and (c) of this
Section 3.2.


 


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Section 3.3. Delivery of Documents. All of the Loan Documents, certificates, legal
opinions and other documents and papers referred to in this Article III, unless otherwise
specified, shall be delivered to the Administrative Agent for the account of each of the Lenders
and, except for the Notes, in sufficient counterparts or copies for each of the Lenders and shall
be in form and substance satisfactory in all respects to the Administrative Agent.



ARTICLE IV




REPRESENTATIONS AND WARRANTIES





The Borrower represents and warrants to the Administrative Agent and each Lender as follows:



Section 4.1. Existence; Power. The Borrower and each of its Subsidiaries (i) is duly
organized, validly existing and in good standing as a corporation, partnership or limited liability
company under the laws of the jurisdiction of its organization, (ii) has all requisite power and
authority to carry on its business as now conducted, and (iii) is duly qualified to do business,
and is in good standing, in each jurisdiction where such qualification is required, except where a
failure to be so qualified could not reasonably be expected to result in a Material Adverse Effect.



Section 4.2. Organizational Power; Authorization. The execution, delivery and
performance by each Loan Party of the Loan Documents to which it is a party are within such Loan
Party’s organizational powers and have been duly authorized by all necessary organizational, and if
required, shareholder, partner or member, action. This Agreement has been duly executed and
delivered by the Borrower, and constitutes, and each other Loan Document to which any Loan Party is
a party, when executed and delivered by such Loan Party, will constitute, valid and binding
obligations of the Borrower or such Loan Party (as the case may be), enforceable against it in
accordance with their respective terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or similar laws affecting the enforcement of creditors’
rights generally and by general principles of equity.



Section 4.3. Governmental Approvals; No Conflicts. The execution, delivery and
performance by the Borrower of this Agreement, and by each Loan Party of the other Loan Documents
to which it is a party (a) do not require any consent or approval of, registration or filing with,
or any action by, any Governmental Authority, except those as have been obtained or made and are in
full force and effect, (b) will not violate any Requirements of Law applicable to the Borrower or
any of its Subsidiaries or any judgment, order or ruling of any Governmental Authority, (c) will
not violate or result in a default under any indenture, material agreement or other material
instrument binding on the Borrower or any of its Subsidiaries or any of its assets or give rise to
a right thereunder to require any payment to be made by the Borrower or any of its Subsidiaries and
(d) will not result in the creation or imposition of any Lien on any asset of the Borrower or any
of its Subsidiaries, except Liens (if any) created under the Loan Documents.



Section 4.4. Financial Statements. The Borrower has furnished to each Lender the
audited consolidated balance sheet of the Borrower and its Subsidiaries as of November 30, 2009 and
the related consolidated statements of income, shareholders’ equity and cash flows for the Fiscal
Year then ended audited by PricewaterhouseCoopers LLP. Such financial statements fairly present
the consolidated financial condition of the Borrower and its Subsidiaries as of such dates and the
consolidated results of operations for such periods in conformity with GAAP consistently applied,
subject to year end audit adjustments and the absence of footnotes in the case of the statements
referred to in clause (ii). Since



 


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November 30, 2009, there have been no changes with respect to the Borrower and its
Subsidiaries which have had or could reasonably be expected to have, singly or in the aggregate, a
Material Adverse Effect.




Section 4.5. Litigation and Environmental Matters.



(a) No litigation, investigation or proceeding of or before any arbitrators or Governmental
Authorities is pending against or, to the knowledge of the Borrower, threatened against or
affecting the Borrower or any of its Subsidiaries (i) as to which there is a reasonable possibility
of an adverse determination that could reasonably be expected to have, either individually or in
the aggregate, a Material Adverse Effect or (ii) which in any manner draws into question the
validity or enforceability of this Agreement or any other Loan Document.



(b) Except for the matters set forth on Schedule 4.5, neither the Borrower nor any of
its Subsidiaries (i) has failed to comply with any Environmental Law or to obtain, maintain or
comply with any permit, license or other approval required under any Environmental Law, (ii) has
become subject to any Environmental Liability, (iii) has received notice of any claim with respect
to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.



Section 4.6. Compliance with Laws and Agreements. The Borrower and each Subsidiary is
in compliance with (a) all Requirements of Law and all judgments, decrees and orders of any
Governmental Authority applicable to each of them and (b) all indentures, agreements or other
instruments binding upon it or its properties, except where non-compliance, either singly or in the
aggregate, could not reasonably be expected to result in a Material Adverse Effect.



Section 4.7. Investment Company Act, Etc. The Borrower has elected to be regulated as
a “business development company” as defined in Section 2(a)(46) of the Investment Company Act and
the Borrower and its Subsidiaries are subject to regulation under the Investment Company Act as a
“business development company” and as controlled subsidiaries thereof, respectively, including
under Section 18, as modified by Section 61, of the Investment Company Act; and, after giving
notice to the Administrative Agent that the Borrower no longer elects to be regulated as a
“business development company,” the Borrower is registered with the Securities and Exchange
Commission as an “investment company” as defined under the Investment Company Act, is classified as
a “closed-end company” under Section 5 of the Investment Company Act, and is subject to regulation
as such thereunder.



Section 4.8. Taxes. The Borrower and its Subsidiaries and each other Person for whose
taxes the Borrower or any Subsidiary could become liable have timely filed or caused to be filed
all Federal income tax returns and all other material tax returns that are required to be filed by
them, and have paid all taxes shown to be due and payable on such returns or on any assessments
made against it or its property and all other taxes, fees or other charges imposed on it or any of
its property by any Governmental Authority, except where the same are currently being contested in
good faith by appropriate proceedings and for which the Borrower or such Subsidiary, as the case
may be, has set aside on its books adequate reserves in accordance with GAAP. The charges,
accruals and reserves on the books of the Borrower and its Subsidiaries in respect of such taxes
are adequate, and no tax liabilities that could be materially in excess of the amount so provided
are anticipated.



Section 4.9. Margin Regulations. None of the proceeds of any of the Loans will be
used, directly or indirectly, for any purpose that violates the provisions of Regulation U of the
Board of Governors of the Federal Reserve System. Neither the Borrower nor its Subsidiaries is
engaged



 


46









 






principally, or as one of its important activities, in the business of extending credit for
the purpose of purchasing or carrying “margin stock”.



Section 4.10. Investment Objectives. The Borrower and its Subsidiaries is in
compliance with all Investment Objectives except to the extent that the failure to so comply could
not reasonably be expected to result in a Material Adverse Effect.



Section 4.11. ERISA. No ERISA Event has occurred or is reasonably expected to occur
that, when taken together with all other such ERISA Events for which liability is reasonably
expected to occur, could reasonably be expected to result in a Material Adverse Effect. The
present value of all accumulated benefit obligations under each Plan (based on the assumptions used
for purposes of Statement of Financial Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed the fair market value of the assets of such
Plan, and the present value of all accumulated benefit obligations of all underfunded Plans (based
on the assumptions used for purposes of Statement of Financial Standards No. 87) did not, as of the
date of the most recent financial statements reflecting such amounts, exceed the fair market value
of the assets of all such underfunded Plans.




Section 4.12. Ownership of Property.



(a) Each of the Borrower and its Subsidiaries has good title to, or valid leasehold interests
in, all of its real and personal property material to the operation of its business, including all
such properties reflected in the most recent audited consolidated balance sheet of the Borrower
referred to in Section 4.4 or purported to have been acquired by the Borrower or any
Subsidiary after said date (except as sold or otherwise disposed of in the ordinary course of
business), in each case free and clear of Liens prohibited by this Agreement. All leases that
individually or in the aggregate are material to the business or operations of the Borrower and its
Subsidiaries are valid and subsisting and are in full force.



(b) Each of the Borrower and its Subsidiaries owns, or is licensed, or otherwise has the
right, to use, all patents, trademarks, service marks, trade names, copyrights and other
intellectual property material to its business, and the use thereof by the Borrower and its
Subsidiaries does not infringe in any material respect on the rights of any other Person.



(c) The properties of the Borrower and its Subsidiaries are insured with financially sound and
reputable insurance companies which are not Affiliates of the Borrower, in such amounts with such
deductibles and covering such risks as are customarily carried by companies engaged in similar
businesses and owning similar properties in localities where the Borrower or any applicable
Subsidiary operates.



Section 4.13. Disclosure. The Borrower has disclosed to the Lenders all agreements,
instruments, and corporate or other restrictions to which the Borrower or any of its Subsidiaries
is subject, and all other matters known to any of them, that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect. Neither the Information
Memorandum nor any of the reports (including without limitation all reports that the Borrower is
required to file with the Securities and Exchange Commission), financial statements, certificates
or other information furnished by or on behalf of the Borrower to the Administrative Agent or any
Lender in connection with the negotiation or syndication of this Agreement or any other Loan
Document or delivered hereunder or thereunder (as modified or supplemented by any other information
so furnished) contains any material misstatement of fact or omits to state any material fact
necessary to make the statements therein, taken as a whole, in light of the circumstances under
which they were made, not misleading.


 


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Section 4.14. Labor Relations. There are no strikes, lockouts or other material labor
disputes or grievances against the Borrower or any of its Subsidiaries, or, to the Borrower’s
knowledge, threatened against or affecting the Borrower or any of its Subsidiaries, and no
significant unfair labor practice, charges or grievances are pending against the Borrower or any of
its Subsidiaries, or to the Borrower’s knowledge, threatened against any of them before any
Governmental Authority. All payments due from the Borrower or any of its Subsidiaries pursuant to
the provisions of any collective bargaining agreement have been paid or accrued as a liability on
the books of the Borrower or any such Subsidiary, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.



Section 4.15. Subsidiaries. Schedule 4.15 sets forth the name of, the
ownership interest of the Borrower in, the jurisdiction of incorporation or organization of, and
the type of, each Subsidiary and identifies each Subsidiary that is a Subsidiary Guarantor, in each
case as of the Closing Date.



Section 4.16. Solvency. After giving effect to the execution and delivery of the Loan
Documents, the making of the Loans under this Agreement, each of the Borrower and its Subsidiaries
are Solvent.



Section 4.17. OFAC. No Loan Party (i) is a Sanctioned Person, (ii) has more than 15%
of its assets in Sanctioned Countries, or (iii) derives more than 15% of its operating income from
investments in, or transactions with Sanctioned Persons or Sanctioned Countries. No part of the
proceeds of any Loans hereunder will be used directly or indirectly to fund any operations in,
finance any investments or activities in or make any payments to, a Sanctioned Person or a
Sanctioned Country or for any payments to any governmental official or employee, political party,
official of a political party, candidate for political office, or anyone else acting in an official
capacity, in order to obtain, retain or direct business or obtain any improper advantage, in
violation of the United States Foreign Corrupt Practices Act of 1977, as amended.



Section 4.18. Patriot Act. No Loan Party is an “enemy” or an “ally of the enemy”
within the meaning of Section 2 of the Trading with the Enemy Act of the United States of America
(50 U.S.C. App. §§ 1 et seq.), as amended or any enabling legislation or executive order relating
thereto. Neither any Loan Party nor any or its Subsidiaries is in violation of (a) the Trading
with the Enemy Act, as amended, (b) any of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation
or executive order relating thereto or (c) the Patriot Act. None of the Loan Parties (i) is a
blocked person described in section 1 of the Anti-Terrorism Order or (ii) to the best of its
knowledge, engages in any dealings or transactions, or is otherwise associated, with any such
blocked person.



ARTICLE V




AFFIRMATIVE COVENANTS




The Borrower covenants and agrees that so long as any Lender has a Commitment hereunder or any
Obligation remains unpaid or outstanding:



Section 5.1. Financial Statements and Other Information. The Borrower will deliver to
the Administrative Agent:


 


48









 





(a) as soon as available and in any event within 90 days after the end of each Fiscal Year of
Borrower, a copy of the annual audited report for such Fiscal Year for the Borrower and its
Subsidiaries, containing a consolidated balance sheet of the Borrower and its Subsidiaries as of
the end of such Fiscal Year and the related consolidated statements of income, stockholders’ equity
and cash flows (together with all footnotes thereto) of the Borrower and its Subsidiaries for such
Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal
Year, all in reasonable detail and reported on by PricewaterhouseCoopers LLP or other independent
public accountants of nationally recognized standing (without a “going concern” or like
qualification, exception or explanation and without any qualification or exception as to scope of
such audit) to the effect that such financial statements present fairly in all material respects
the financial condition and the results of operations of the Borrower and its Subsidiaries for such
Fiscal Year on a consolidated and consolidating basis in accordance with GAAP and that the
examination by such accountants in connection with such consolidated financial statements has been
made in accordance with generally accepted auditing standards; provided, that to the extent
that any Special Purpose Subsidiary has entered into a financing transaction, securitization or
other monetization transaction and is treated as a consolidated entity and reflected on the
consolidated balance sheet of the Borrower and its Subsidiaries, concurrently with the delivery of
the financial statements referred to in this paragraph (a), the Borrower shall provide to the
Administrative Agent a balance sheet for each such Special Purpose Subsidiary as of the end of such
Fiscal Year and the related statements of income, stockholders’ equity and cash flows (together
with all footnotes thereto) of such Special Purpose Subsidiary for such Fiscal Year, setting forth
in each case in comparative form the figures for the previous Fiscal Year;



(b) as soon as available and in any event within 45 days after the end of each Fiscal Quarter
of the Borrower, an unaudited consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as of the end of such Fiscal Quarter and the related unaudited consolidated and
consolidating statements of income and cash flows of the Borrower and its Subsidiaries for such
Fiscal Quarter and the then elapsed portion of such Fiscal Year, setting forth in each case in
comparative form the figures for the corresponding quarter and the corresponding portion of
Borrower’s previous Fiscal Year, all certified by the chief financial officer or treasurer of the
Borrower as presenting fairly in all material respects the financial condition and results of
operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP,
subject to normal year-end audit adjustments and the absence of footnotes; provided, that
to the extent that any Special Purpose Subsidiary has entered into a financing transaction,
securitization or other monetization transaction and is treated as a consolidated entity and
reflected on the consolidated balance sheet of the Borrower and its Subsidiaries, concurrently with
the delivery of the financial statements referred to in this paragraph (b), the Borrower shall
provide to the Administrative Agent a balance sheet for each such Special Purpose Subsidiary as of
the end of such Fiscal Quarter and the related statements of income, stockholders’ equity and cash
flows (together with all footnotes thereto) of such Special Purpose Subsidiary for such Fiscal
Quarter, setting forth in each case in comparative form the figures for the previous Fiscal
Quarter;



(c) concurrently with the delivery of the financial statements referred to in clauses (a) and
(b) above, a Compliance Certificate signed by the principal financial officer of the Borrower;



(d) concurrently with the delivery of the financial statements referred to in clause (a)
above, a certificate of the accounting firm that reported on such financial statements stating
whether they obtained any knowledge during the course of their examination of such financial
statements of any Default or Event of Default (which certificate may be limited to the extent
required by accounting rules or guidelines);


 


49









 





(e) as soon as available and in any event not later than the tenth day of each calendar month,
a Borrowing Base Certificate as of the last day of the preceding month, and as soon as available, a
monthly brokerage statement for each securities or deposit account held by Borrower or any
Subsidiary;



(f) promptly but no later than five Business Days after the Borrower shall at any time have
knowledge that there is a Borrowing Base Deficiency, a Borrowing Base Certificate as at that date
the Borrower has knowledge of such Borrowing Base Deficiency indicating the amount of the Borrowing
Base Deficiency as at the date the Borrower obtained knowledge of such deficiency and the amount of
the Borrowing Base Deficiency as of the date which is two Business Days prior to the date the
Borrowing Base Certificate is delivered pursuant to this paragraph;



(g) as soon as available and in any event within 20 days after the end of each Fiscal Quarter
of the Borrower, beginning with the Fiscal Quarter ended May 31, 2010, Borrower will submit its
private investment valuations to the Administrative Agent;



(h) concurrently with the delivery of the financial statements referred to in clauses (a) and
(b) above, beginning with the Fiscal Quarter ended May 31, 2010, a valuation report of the
investments that are not Quoted Securities of the Borrower and its Subsidiaries, conducted by an
Approved Third Party Appraiser



(i) promptly after the same become publicly available, copies of all periodic and other
reports, proxy statements and other materials filed with the Securities and Exchange Commission, or
any Governmental Authority succeeding to any or all functions of said Commission, or with any
national securities exchange, or distributed by the Borrower to its shareholders generally, as the
case may be;



(j) promptly following any request therefor, such other information regarding the results of
operations, business affairs, financial condition and loan and securities portfolio of the Borrower
or any Subsidiary as the Administrative Agent or any Lender may reasonably request.



Section 5.2. Notices of Material Events. The Borrower will furnish to the
Administrative Agent and each Lender prompt written notice of the following:




(a) the occurrence of any Default or Event of Default;



(b) the filing or commencement of any action, suit or proceeding by or before any arbitrator
or Governmental Authority against or, to the knowledge of the Borrower, affecting the Borrower or
any Subsidiary which, if adversely determined, could reasonably be expected to result in a Material
Adverse Effect;



(c) the occurrence of any event or any other development by which the Borrower or any of its
Subsidiaries (i) fails to comply with any Environmental Law or to obtain, maintain or comply with
any permit, license or other approval required under any Environmental Law, (ii) becomes subject
to any Environmental Liability, (iii) receives notice of any claim with respect to any
Environmental Liability, or (iv) becomes aware of any basis for any Environmental Liability and in
each of the preceding clauses, which individually or in the aggregate, could reasonably be expected
to result in a Material Adverse Effect;



(d) the occurrence of any ERISA Event that alone, or together with any other ERISA Events that
have occurred, could reasonably be expected to result in liability of the Borrower and its
Subsidiaries in an aggregate amount exceeding $1,000,000;


 


50









 





(e) the occurrence of any default or event of default, or the receipt by Borrower or any of
its Subsidiaries of any written notice of an alleged default or event of default, respect of any
Material Indebtedness of the Borrower or any of its Subsidiaries; and



(f) any other development that results in, or could reasonably be expected to result in, a
Material Adverse Effect.



Each notice delivered under this Section 5.2 shall be accompanied by a written statement of
a Responsible Officer setting forth the details of the event or development requiring such notice
and any action taken or proposed to be taken with respect thereto.



Section 5.3. Existence; Conduct of Business. The Borrower will, and will cause each
of its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and maintain
in full force and effect its legal existence and its respective rights, licenses, permits,
privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of
its business and will continue to engage in the same business as presently conducted or such other
businesses that are reasonably related thereto; provided, that nothing in this Section
5.3 shall prohibit any merger, consolidation, liquidation or dissolution permitted under
Section 7.3.



Section 5.4. Compliance with Laws, Etc. The Borrower will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations and requirements of any Governmental
Authority applicable to its business and properties, including without limitation, all
Environmental Laws, ERISA and OSHA, except where the failure to do so, either individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse Effect.



Section 5.5. Payment of Obligations. The Borrower will, and will cause each of its
Subsidiaries to, pay and discharge at or before maturity, all of its obligations and liabilities
(including without limitation all taxes, assessments and other governmental charges, levies and all
other claims that could result in a statutory Lien) before the same shall become delinquent or in
default, except where (a) the validity or amount thereof is being contested in good faith by
appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on its books adequate
reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending
such contest could not reasonably be expected to result in a Material Adverse Effect.



Section 5.6. Books and Records. The Borrower will, and will cause each of its
Subsidiaries to, keep proper books of record and account in which full, true and correct entries
shall be made of all dealings and transactions in relation to its business and activities to the
extent necessary to prepare the consolidated financial statements of Borrower in conformity with
GAAP.



Section 5.7. Visitation, Inspection, Etc. The Borrower will, and will cause each of
its Subsidiaries to, permit any representative of the Administrative Agent, or any Lender, to visit
and inspect its properties, to conduct audits of the Collateral, to examine its books and records
and to make copies and take extracts therefrom, and to discuss its affairs, finances and accounts
with any of its officers and with its independent certified public accountants, all at such
reasonable times and as often as the Administrative Agent or any Lender may reasonably request
after reasonable prior notice to the Borrower; provided, however, if a Default or an Event of
Default has occurred and is continuing, no prior notice shall be required. All reasonable expenses
incurred by the Administrative Agent and, at any time after the occurrence and during the
continuance of a Default or an Event of Default, any Lenders in connection with any such visit,
inspection, audit, examination and discussions shall be borne by the Borrower; provided, however,
so long as no Default or Event of Default has occurred and is continuing,



 


51









 






Borrower shall not be required to pay such expenses for any visits and inspections that exceed
two visits or inspections per Fiscal Year.



Section 5.8. Maintenance of Properties; Insurance. The Borrower will, and will cause
each of its Subsidiaries to, (a) keep and maintain all property material to the conduct of its
business in good working order and condition, ordinary wear and tear excepted, (b) maintain with
financially sound and reputable insurance companies, insurance with respect to its properties and
business, and the properties and business of its Subsidiaries, against loss or damage of the kinds
customarily insured against by companies in the same or similar businesses operating in the same or
similar locations, and (c) at all times shall name the Administrative Agent as additional insured
on all liability policies of the Borrower and its Subsidiaries.



Section 5.9. Use of Proceeds. The Borrower will use the proceeds of all Revolving
Loans to repay loans outstanding under the Existing Credit Agreement and for investments consistent
with the Borrower’s Investment Objectives and to finance working capital needs. No part of the
proceeds of any Loan will be used, whether directly or indirectly, for any purpose that would
violate any rule or regulation of the Board of Governors of the Federal Reserve System, including
Regulations T, U or X.



Section 5.10. Additional Subsidiaries; Additional Collateral. In the event that any
Person becomes a Subsidiary of Borrower after the date hereof (other than a Special Purpose
Subsidiary), Borrower will promptly notify Administrative Agent of that fact and cause such
Subsidiary to execute and deliver to Administrative Agent a counterpart of the Subsidiary Guarantee
Agreement and Security Agreement and to take all such further actions and execute all such further
documents and instruments (including similar documents applicable to such Subsidiary required under
Section 3.1) as may be necessary or, in the opinion of Administrative Agent, desirable to
create in favor of Administrative Agent, for the benefit of Lenders, a valid and perfected first
priority lien on all of the personal property assets of such Subsidiary described in the applicable
forms of Security Documents. In addition, Borrower shall, or shall cause the Subsidiary that owns
the Capital Stock of such Person, to execute and deliver to Administrative Agent a pledge agreement
pledging the Capital Stock of such Person to the Administrative Agent and to deliver to
Administrative Agent all certificates representing such Capital Stock of such Person (accompanied
by irrevocable undated stock powers, duly endorsed in blank), all in form and substance
satisfactory to the Administrative Agent in its sole discretion.




Section 5.11. Portfolio Valuation and Diversifications, Etc.




(a) Portfolio Valuation Etc.




(i) Settlement Date Basis. For purposes of this Agreement, all determinations
of whether an investment is to be included as a Portfolio Investment shall be determined on
a settlement-date basis, provided that no such investment shall be included as a
Portfolio Investment to the extent it has not been paid for in full.




(ii) Determination of Values. The Borrower will conduct reviews of the value
to be assigned to each of its Portfolio Investment as follows:




(A) Quoted Investments—External Review. With respect to Portfolio
Investments (including Cash Equivalents) for which market quotations are readily
available, the Borrower shall, not less frequently than once each calendar week,
determine the market value of such Portfolio Investments which shall, in each case,
be


 


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determined in accordance with one of the following methodologies (as selected
by the Borrower):




(x) in the case of Bank Loans, the mean price as determined by one
Approved Dealer selected by the Borrower and approved by the Administrative
Agent in its sole discretion,




(y) in the case of any Portfolio Investment traded on an exchange, the
closing price for such Portfolio Investment most recently posted on such
exchange, and




(z) in the case of any other Portfolio Investment, the fair market
value thereof as determined by an Approved Pricing Service; and




(B) Unquoted Investments—External Review. With respect to Portfolio
Investments for which market quotations are not readily available, the Borrower
shall request an Approved Third Party Appraiser to assist the Board of Directors of
the Borrower in determining the fair market value of such Portfolio Investments, as
at the last day of each Fiscal Quarter, provided that




(x) the Value of any such Portfolio Investment (i.e. a Portfolio
Investment for which market quotations are not readily available) acquired
during a Fiscal Quarter shall be deemed to be equal to the cost of such
Portfolio Investment until such time as the fair market value of such
Portfolio Investment is determined in accordance with the foregoing
provisions of this sub-clause (B) as at the last day of such Fiscal Quarter
and




(y) notwithstanding the foregoing, the Board of Directors of the
Borrower may, without the assistance of an Approved Third Party Appraiser,
determine the fair market value of Portfolio Investments so long as the
aggregate Value thereof so determined does not at any time exceed 10% of the
aggregate Borrowing Base, except that the fair market value of any Portfolio
Investment that has been determined without the assistance of an Approved
Third Party Appraiser as at the last day of any Fiscal Quarter shall be
deemed to be zero as at the last day of the immediately succeeding Fiscal
Quarter (but effective upon the date upon which the Borrowing Base
Certificate for such last day is required to be delivered hereunder) if an
Approved Third Party Appraiser has not assisted the Board of Directors of
the Borrower in determining the fair market value of such Portfolio
Investments, as at such date.




(C) Internal Review. The Borrower shall conduct internal reviews of
all Portfolio Investments at least once each calendar week which shall take into
account any events of which the Borrower has knowledge that adversely affect the
value of the Portfolio Investments. If the value of any Portfolio Investment as
most recently determined by the Borrower pursuant to this Section
5.11(a)(ii)(C) is lower than the value of such Portfolio Investment as most
recently determined pursuant to Section 5.11(a)(ii)(A) and (B), such lower
value shall be deemed to be the “Value” of such Portfolio Investment for purposes
hereof, provided that the Value of any Portfolio Investment of the Borrower
and its Subsidiaries shall be increased by the net unrealized gain as at the date
such Value is determined of any Hedging Transaction entered into to hedge risks
associated with such Portfolio Investment and reduced by the net unrealized


 


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loss as at such date of any such Hedging Transaction (such net unrealized gain
or net unrealized loss, on any date, to be equal to the aggregate amount receivable
or payable under the related Hedging Transaction if the same were terminated on such
date).



(b) Failure to Determine Values. If the Borrower shall fail to determine the value of
any Portfolio Investment as at any date pursuant to the requirements of sub-clauses (A), (B) or (C)
of Section 5.11(a), then the “Value” of such Portfolio Investment as at such date shall be
deemed to be zero.



(c) Administrative Agent Approval of Valuations. Per Section 5.1(g) above,
the Borrower will submit its valuations to the Administrative Agent and the Administrative Agent
shall have 10 days upon its receipt of the valuations to approve such valuations (used solely for
the purposes of calculating the Borrowing Base), in its reasonable discretion. If the
Administrative Agent does not object to the valuations within the 10 day period, the Administrative
Agent shall be deemed to approve such valuations.



Section 5.12. Calculation of Borrowing Base. For purposes of this Agreement, the
“Borrowing Base” shall be determined, as at any date of determination, as the sum of the Advance
Rates of the Value of each Portfolio Investment, provided that:



(a) in the event that the portion of the Borrowing Base attributable to Private MLP Common and
Preferred Units exceeds 25% of the total Borrowing Base, the Borrowing Base shall be reduced to the
extent such portion exceeds 25% of the total Borrowing Base;



(b) in the event that the portion of the Borrowing Base attributable to the aggregate amount
of Non-Performing Bank Loans, Non-Performing High Yield Securities, and Warrants exceeds 10% of the
total Borrowing Base, the Borrowing Base shall be reduced to the extent such portion exceeds 10% of
the total Borrowing Base;



(c) no Portfolio Investment may be included in the Borrowing Base until such time as such
Portfolio Investment has been Delivered (as defined in the Guarantee and Security Agreement) to the
Administrative Agent, and then only for so long as such Portfolio Investment continues to be
Delivered as contemplated therein and is subject to a first priority security interest in favor of
the Administrative Agent;



(d) the Advance Rate applicable to that portion of the aggregate Value of the Portfolio
Investments subject to Lock-up Agreements that have a Lock-up Term equal to or less than ninety
(90) days from the date of determination shall be reduced by 10%;



(e) the Advance Rate applicable to that portion of the aggregate Value of the Portfolio
Investments subject to Lock-up Agreements that have a Lock-up Term of more than ninety (90) days
but less than or equal to one-hundred eighty (180) days from the date of determination shall be
reduced by 20%;



(f) no Portfolio Investment may be included in the Borrowing Base if the agreements evidencing
such Portfolio Investment are subject to Lock-up Agreements that have a Lock-up Term of more than
one-hundred eighty (180) days from the date of determination;



(g) the Advance Rate applicable to that portion of the aggregate Value of the Portfolio
Investments that are subject to a Right of First Offer that is for an Offer Period of more than
forty-five (45) days but less than or equal to ninety (90) days shall be reduced by 10%;


 


54









 





(h) no Portfolio Investment may be included in the Borrowing Base if the agreements evidencing
such Portfolio Investment contain a Right of First Offer that is for an Offer Period of more than
ninety (90) days;



(i) no reduction shall be made to the Advance Rate applicable to that portion of the Value of
any Portfolio Investment subject to a Lock-up Agreement, a Right of First Offer or Tag Along
Rights, if the agreements evidencing such Portfolio Investment provide that such Lock-up Agreement,
Right of First Offer or Tag Along Rights, as applicable, expires or is of no force or effect upon
any action to sell, transfer or otherwise liquidate, or to market or offer for sale, or solicit
offers to purchase such Portfolio Investments in connection with the occurrence of an Event of
Default;



(j) contributions of any single issuer of Portfolio Investments in a consolidated group of
corporations or other entities to the Borrowing Base shall not exceed 10% of the Revolving
Commitment Amount; and



(k) the Advance Rate applicable to that portion of the Value of any Portfolio Investment that
is subject to a Tag Along Right shall be 0%. For these purposes, the amount that could be
restricted from sale is equal to the percentage of the total Securities of the Borrower that would
not be sold in such sale of Securities if all other parties to such Tag Along Rights elected to
participate in such sale of Securities.



The Borrower shall from time to time deliver a Borrowing Base Certificate to the
Administrative Agent and each Lender as provided in Sections 3.1(c)(xvii), 5.1(e),
5.1(f), 7.4(c) and 7.4(e).



Section 5.13. Compliance with Investment Objectives. The Borrower shall, and shall
cause its Subsidiaries, to comply at all times with its Investment Objectives.



ARTICLE VI




FINANCIAL COVENANTS




The Borrower covenants and agrees that so long as any Lender has a Commitment hereunder or any
Obligation remains unpaid or outstanding:



Section 6.1. Minimum Asset Coverage Ratio. The Borrower shall maintain at all times
an Asset Coverage Ratio of at least 2.50:1.0 (the “Required Threshold”); provided
however, that if the Borrower ceases to be regulated as a “business development company” as
defined in Section 2(a)(46) of the Investment Company Act then and in such event the Required
Threshold shall be increased to 3.00:1.00 (the “Closed End Company Required Threshold”).



Section 6.2. Minimum Liquidity. The Borrower will not permit the aggregate Value of
the Portfolio Investments that can be converted to Cash in fewer than 10 Business Days without more
than a 5% change in price to be less than 10% of the aggregate principal amount of all of the
Revolving Credit Exposures of all Lenders during any period when Adjusted Revolving Credit Exposure
Amount is greater than 90% of the Adjusted Borrowing Base.



Section 6.3. Minimum Consolidated Shareholders Equity. The Borrower will not permit
Shareholder’s Equity at the last day of any Fiscal Quarter of the Borrower to be less than the



 


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greater of (i) 40% of the total assets of the Borrower and its Subsidiaries as at the last day
of such Fiscal Quarter (determined on a consolidated basis, without duplication, in accordance with
GAAP) and (ii) $70,000,000 plus 25% of the net proceeds of the sale of Equity Interests by
the Borrower and its Subsidiaries after the Closing Date.



ARTICLE VII




NEGATIVE COVENANTS




The Borrower covenants and agrees that so long as any Lender has a Commitment hereunder or any
Obligation remains outstanding:



Section 7.1. Indebtedness and Preferred Equity. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or suffer to exist any Indebtedness,
except:




(a) Indebtedness created pursuant to the Loan Documents;



(b) Indebtedness of the Borrower and its Subsidiaries existing on the date hereof and set
forth on Schedule 7.1 and extensions, renewals and replacements of any such Indebtedness
that do not increase the outstanding principal amount thereof (immediately prior to giving effect
to such extension, renewal or replacement) or shorten the maturity or the weighted average life
thereof;



(c) Indebtedness of the Borrower owing to any Subsidiary and of any Subsidiary owing to the
Borrower or any other Subsidiary;



(d) Guarantees by the Borrower of Indebtedness of any Subsidiary Guarantor and by any
Subsidiary of Indebtedness of the Borrower;




(e) Indebtedness in respect of Hedging Obligations not prohibited by Section 7.9;



(f) other unsecured Indebtedness in an aggregate principal amount not to exceed $10,000,000 at
any time outstanding;



(g) Indebtedness incurred by any Special Purpose Subsidiary that is non-recourse to the Loan
Parties; and



(h) Indebtedness arising in connection with the accrual of any fees and expenses required to
be paid under the Investment Advisory Agreement.



Borrower will not, and will not permit any Subsidiary Guarantor to, issue any Preferred Stock or
other preferred equity interests that (i) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise, (ii) is or may become redeemable or repurchaseable by
Borrower or such Subsidiary Guarantor at the option of the holder thereof, in whole or in part or
(iii) is convertible or exchangeable at the option of the holder thereof for Indebtedness or
Preferred Stock or any other preferred equity interests described in this paragraph, on or prior
to, in the case of clause (i), (ii) or (iii), the first anniversary of the Revolving Commitment
Termination Date.



Section 7.2. Negative Pledge. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien on any of its assets or property
now owned or hereafter acquired or, except:


 


56









 





(a) Liens securing the Obligations; provided, however, that no Liens may
secure Hedging Obligations without securing all other Obligations on a basis at least pari passu
with such Hedging Obligations and subject to the priority of payments set forth in Section 2.19
of this Agreement;




(b) Permitted Encumbrances;



(c) any Liens on any property or asset of the Borrower or any Subsidiary existing on the
Closing Date set forth on Schedule 7.2; provided, that such Lien shall not apply to
any other property or asset of the Borrower or any Subsidiary; and



(d) rights of set off, rights over a margin call account, any form of cash collateral or
similar arrangement, in any case for obligations incurred in respect of any Hedging Transactions so
long as such Liens do not encumber assets securing the Obligations.




Section 7.3. Fundamental Changes.



(a) The Borrower will not, and will not permit any Subsidiary Guarantor to, merge into or
consolidate into any other Person, or permit any other Person to merge into or consolidate with it,
or sell, lease, transfer or otherwise dispose of (in a single transaction or a series of
transactions) all or substantially all of its assets (in each case, whether now owned or hereafter
acquired) or all or substantially all of the stock of any of its Subsidiaries (in each case,
whether now owned or hereafter acquired) or liquidate or dissolve; provided, that if at the
time thereof and immediately after giving effect thereto, no Default or Event of Default shall have
occurred and be continuing (i) the Borrower or any Subsidiary may merge with a Person if the
Borrower (or such Subsidiary if the Borrower is not a party to such merger) is the surviving
Person, (ii) any Subsidiary may merge into another Subsidiary; provided, that if any party
to such merger is a Subsidiary Guarantor, the Subsidiary Guarantor shall be the surviving Person,
(iii) any Subsidiary may sell, transfer, lease or otherwise dispose of all or substantially all of
its assets to the Borrower or to a Subsidiary Guarantor, and (iv) any Subsidiary (other than a
Subsidiary Guarantor) may liquidate or dissolve if the Borrower determines in good faith that such
liquidation or dissolution is in the best interests of the Borrower, and is not materially
disadvantageous to the Lenders.



(b) The Borrower will not, and will not permit any of its Subsidiaries to, engage in any
business other than businesses of the type conducted by the Borrower and its Subsidiaries on the
date hereof and businesses reasonably related thereto. The Special Purpose Subsidiaries will not
engage in any business other than to hold such assets and conduct such business as is consistent
with its purpose and businesses reasonably related thereto




Section 7.4. Restricted Payments.



The Borrower will not, nor will it permit any of its Subsidiaries to, declare to make, or
agree to pay or make, directly or indirectly, any Restricted Payment, except that the Borrower may
declare and pay:



(a) dividends with respect to the capital stock of the Borrower payable solely in additional
shares of the Borrower’s common stock;



(b) dividends and distributions in either case in cash or other property (excluding for this
purpose the Borrower’s common stock) in any taxable year of the Borrower in amounts not to exceed
the amount that is estimated in good faith by the Borrower to be required to (i) reduce to zero for
such taxable year or for the previous taxable year, its investment company taxable income (within
the meaning



 


57









 






of section 852(b)(2) of the Code), and reduce to zero the tax imposed by section 852(b)(3) of
the Code, and (ii) avoid federal excise taxes for such taxable year imposed by section 4982 of the
Code;



(c) dividends and distributions in respect of Distributable Cash Flow for the prior Fiscal
Quarter and for the three Fiscal Quarters immediately preceding such prior Fiscal Quarter that has
not been previously distributed in addition to the dividends and distributions permitted under the
foregoing clauses (a) and (b), so long as (i) on the date of such Restricted Payment and after
giving effect thereto no Default or Event of Default shall have occurred and be continuing, (ii)
such dividends and distributions are made in accordance with a written policy approved by the Board
of Directors of the Borrower, (iii) five (5) Business Days prior to such dividend or distribution,
the Borrower delivers to the Administrative Agent and each Lender a Distributable Cash Flow
Certificate demonstrating the basis for the Borrower’s calculation of Distributable Cash Flow for
such period; and (iv) on the date of such dividend or distribution the Borrower delivers to the
Administrative Agent and each Lender a Borrowing Base Certificate as at such date demonstrating
that no Borrowing Base Deficiency exists after giving effect to such dividend or distribution. For
purposes of preparing such Borrowing Base Certificate, (A) the Value of Portfolio Investments for
which market quotations are readily available shall be the most recent quotation available for such
Portfolio Investment and (B) the Value of Portfolio Investments for which market quotations are not
readily available shall be the Value set forth in the Borrowing Base Certificate most recently
delivered by the Borrower to the Administrative Agent and the Lenders pursuant to Section
5.1(e), provided that the Borrower shall reduce the Value of any Portfolio Investment
referred to in this sub-clause (B) to the extent necessary to take into account any events of which
the Borrower has knowledge that adversely affect the Value of such Portfolio Investment;



(d) dividends and distributions in each case in cash or other property (excluding for this
purpose the Borrower’s common stock) in addition to the dividends and distributions permitted under
the foregoing clauses (a), (b) and (c), so long as on the date of such Restricted Payment and after
giving effect thereto:




(i) no Default or Event of Default shall have occurred and be continuing; and




(ii) the aggregate amount of Restricted Payments made during any taxable year of the
Borrower after the date hereof under this clause (c) shall not exceed the sum of (x) an
amount equal to 10% of the taxable income of the Borrower for such taxable year determined
under section 852(b)(2) of the Code, but without regard to subparagraphs (A), (B) or (D)
thereof, minus (y) the amount, if any, by which dividends and distributions made
during such taxable year pursuant to the foregoing clause (b) (whether in respect of such
taxable year or the previous taxable year) based upon the Borrower’s estimate of taxable
income exceeded the actual amounts specified in subclauses (i) and (ii) of such foregoing
clause (b) for such taxable year.



(e) other Restricted Payments so long as (i) on the date of such other Restricted Payment and
after giving effect thereto (x) the aggregate principal amount of all of the Revolving Credit
Exposures of all Lenders does not exceed 90% of the Borrowing Base and (y) no Default or Event of
Default shall have occurred and be continuing and (ii) on the date of such other Restricted Payment
the Borrower delivers to the Administrative Agent and each Lender a Borrowing Base Certificate as
at such date demonstrating compliance with subclause (x) after giving effect to such Restricted
Payment. For purposes of preparing such Borrowing Base Certificate, (A) the Value of Portfolio
Investments for which market quotations are readily available shall be the most recent quotation
available for such Portfolio Investment and (B) the Value of Portfolio Investments for which market
quotations are not readily available shall be the Value set forth in the Borrowing Base Certificate
most recently delivered by the Borrower to the Administrative Agent and the Lenders pursuant to
Section 5.1(e), provided that the



 


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Borrower shall reduce the Value of any Portfolio Investment referred to in this sub-clause (B)
to the extent necessary to take into account any events of which the Borrower has knowledge that
adversely affect the Value of such Portfolio Investment.



Nothing herein shall be deemed to prohibit the payment of Restricted Payments by any
Subsidiary of the Borrower to the Borrower or to any other Subsidiary Guarantor.



Section 7.5. Sale of Assets. The Borrower will not, and will not permit any of its
Subsidiaries to, convey, sell, lease, assign, transfer or otherwise dispose of, any of its assets,
business or property, whether now owned or hereafter acquired, or, in the case of any Subsidiary,
issue or sell any shares of such Subsidiary’s common stock to any Person other than the Borrower or
another Subsidiary Guarantor (or to qualify directors if required by applicable law), except (a)
the sale or other disposition for fair market value of obsolete or worn out property or other
property not necessary for operations disposed of in the ordinary course of business; (b) the sale
of inventory, Portfolio Investments, or other investments in the ordinary course of business; and
(c) any sale or other disposition if, after giving effect thereto, the Borrower shall be in
compliance on a pro forma basis after giving effect to such sale, with the covenants contained in
Article 6, in each case recomputed as at the last day of the most recently ended Fiscal Quarter of
the Borrower for which financial statements have been provided for under Section 5.1.



Section 7.6. Transactions with Affiliates. The Borrower will not, and will not permit
any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or
purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except (a) in the ordinary course of business at prices
and on terms and conditions not less favorable to the Borrower or such Subsidiary than could be
obtained on an arm’s-length basis from unrelated third parties, (b) transactions between or among
the Borrower and any Subsidiary Guarantor not involving any other Affiliates, (c) transactions and
transfers provided in the Investment Advisory Agreement, and the Fee Waiver Agreement,(d)
reasonable and customary fees and expenses paid to members of the board of directors (or similar
governing body) of the Borrower and its Subsidiaries that are disclosed in the quarterly filings of
Borrower, (e) Restricted Payments permitted by Section 7.4, (f) transactions in connection
with the provision of managerial assistance to affiliated Portfolio Investments, including fees or
other compensation payable in connection therewith, (g) co-investments with other advisory clients
of Borrower’s investment adviser or its Affiliate, brokerage transactions with Affiliated
broker-dealers, or other transactions with Affiliates, in each case as permitted by applicable
provisions of the Investment Company Act and the rules promulgated thereunder, and (h) any
investment in any Affiliated Portfolio Investment or an investment transaction that results in the
creation of an Affiliate.



Section 7.7. Restrictive Agreements. The Borrower will not, and will not permit any
Subsidiary to, directly or indirectly, enter into, incur or permit to exist any agreement that
prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any
Subsidiary to create, incur or permit any Lien upon any of its assets or properties, whether now
owned or hereafter acquired, or (b) the ability of any Subsidiary to pay dividends or other
distributions with respect to its common stock, to make or repay loans or advances to the Borrower
or any other Subsidiary, to Guarantee Indebtedness of the Borrower or any other Subsidiary or to
transfer any of its property or assets to the Borrower or any Subsidiary of the Borrower;
provided, that (i) the foregoing shall not apply to restrictions or conditions imposed by
law or by this Agreement or any other Loan Document; (ii) the foregoing shall not apply to
customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary
pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is
sold and such sale is permitted hereunder; (iii) clause (a) shall not apply to restrictions or
conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if
such restrictions and



 


59









 






conditions apply only to the property or assets securing such Indebtedness; (iv) clause (a)
shall not apply to customary provisions in leases and other contracts restricting the assignment
thereof; (v) clause (b) shall not apply to any agreements containing provisions (other than any
Right of First Offer or Tag Along Rights) applicable to a Portfolio Investment that prohibit,
restrict or impose any condition upon the ability of the Borrower or any other Subsidiary to
transfer any of its property or assets (each a “Lock-up Agreement”); and (vi) clause (b) shall not
apply to any agreements that contain a Right of First Offer or Tag Along Rights applicable to a
Portfolio Investment.



Section 7.8. Sale and Leaseback Transactions. The Borrower will not, and will not
permit any Subsidiary Guarantor to, enter into any arrangement, directly or indirectly, whereby it
shall sell or transfer any property, real or personal, used or useful in its business, whether now
owned or hereinafter acquired, and thereafter rent or lease such property or other property that it
intends to use for substantially the same purpose or purposes as the property sold or transferred.



Section 7.9. Hedging Transactions. The Borrower will not, and will not permit any of
the Subsidiaries to, enter into any Hedging Transaction, other than Hedging Transactions entered
into in the ordinary course of business (i) to hedge or mitigate risks to which the Borrower or any
Subsidiary is exposed in the conduct of its business or the management of its liabilities, or (ii)
with any counterparty who is or is anticipated to become, at the time that the Hedging Transaction
is entered into, a borrower from a Loan Party or the issuer of a debt or equity interest to a Loan
Party, which Hedging Transaction is entered into to hedge or mitigate risks to which such
counterparty and its affiliates are exposed in the conduct of their businesses or the management of
their liabilities, or (iii) to hedge or mitigate risks to which a Loan Party is exposed under
Hedging Transactions described in the preceding clause (ii) or to effect an offset or unwind of any
other Hedging Transaction; provided that the Loan Parties shall act in a reasonable and prudent
manner to achieve, in the aggregate, substantially offsetting Hedging Transactions under clause
(iii) with respect to the Net Mark to Market Exposure under the Hedging Transactions that are from
time to time outstanding under clause (ii). Solely for the avoidance of doubt, the Borrower
acknowledges that a Hedging Transaction entered into for speculative purposes or of a speculative
nature is not a Hedging Transaction entered into in the ordinary course of business to hedge or
mitigate risks.



Section 7.10. Accounting Changes. The Borrower will not, and will not permit any of
its Subsidiaries to, make any significant change in accounting treatment or reporting practices,
except as required or permitted by GAAP, or change the fiscal year of the Borrower or of any
Subsidiary Guarantor, except to change the fiscal year of a Subsidiary Guarantor to conform its
fiscal year to that of the Borrower.



Section 7.11. Amendment to Material Documents. Upon the occurrence and during the
continuation of an Event of Default, the Borrower will not, and will not permit any of its
Subsidiaries to, agree to or permit any amendment, modification or waiver of any provision of the
Investment Advisory Agreement if the effect of such amendment, modification or waiver is to
increase the amount of fees or other amounts payable by the Borrower or any of its Subsidiaries
under such agreements or alter the payment schedule with respect to such fees or such other amounts
without the prior written consent of the Administrative Agent.



Section 7.12. Loans, Etc. The Borrower will not permit at any time the aggregate
amount of all unfunded commitments of the Borrower and its Subsidiaries to provide loans, advances
or Guarantees with respect to the Portfolio Investments (but excluding any “unapproved capital
expenditure amount” as defined below) to exceed the sum of (i) all cash of the Borrower and its
Subsidiaries held in deposit accounts that are subject to a Control Agreement granting the
Administrative Agent a first priority security interest therein, plus (ii) the difference
between (x) the Revolving Commitment Amount minus


 


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(y) the Revolving Credit Exposure. For purposes of this Section 7.12, “unapproved
capital expenditure amount” means the portion of any commitment that (i) may only be used for
capital expenditures (including drilling and completion of wells, the purchase of assets or other
capital expenditures) that are approved by (or consented to by) the Borrower or such Subsidiary in
its sole discretion or words of similar effect (whether under a specific approval or under a budget
that must be approved) and (ii) exceeds the amount of the capital expenditures that have been so
approved and that, if applicable, will not be paid from cash flow from operations under the
approved budget.



Section 7.13. Deposit Accounts; Other Accounts. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into any agreement or open any account with any
depository, securities intermediary or commodities intermediary which is not subject to a Control
Agreement with respect to such deposit, securities, commodity or similar account maintained by such
Person (other than (i) any payroll account so long as such payroll account is a zero balance
account, (ii) withholding tax and fiduciary accounts (and other accounts for the benefit of
employees), and (iii) the Approved Brokerage Accounts so long as the aggregate amount held in such
Approved Brokerage Accounts does not exceed $5,000,000 at any time).



Section 7.14. Government Regulation. Neither the Borrower nor any of its Subsidiaries
(a) is or may become subject at any time to any law, regulation, or list of any Government
Authority of the United States (including, without limitation, the U.S. Office of Foreign Asset
Control list) that directly prohibits or limits Lenders or the Administrative Agent from making any
advance or extension of credit to Borrower or from otherwise conducting business with the Loan
Parties, or (b) fail to provide documentary and other evidence of the identity of the Loan Parties
as may be reasonably requested by Lenders or the Administrative Agent at any time to enable Lenders
or the Administrative Agent to verify the identity of the Loan Parties or to comply with any
applicable law or regulation, including, without limitation, Section 326 of the USA Patriot Act of
1 U.S.C. Section 5318.



ARTICLE VIII




EVENTS OF DEFAULT




Section 8.1. Events of Default. If any of the following events (each an “Event of
Default”) shall occur:



(a) the Borrower shall fail to pay any principal of any Loan when and as the same shall become
due and payable, whether at the due date thereof or at a date fixed for prepayment or otherwise; or



(b) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount
(other than an amount payable under clause (a) of this Section 8.1) payable under this
Agreement or any other Loan Document, when and as the same shall become due and payable, and such
failure shall continue unremedied for a period of three (3) Business Days; or



(c) any representation or warranty made or deemed made by or on behalf of the Borrower or any
Subsidiary in or in connection with this Agreement or any other Loan Document (including the
Schedules attached thereto) and any amendments or modifications hereof or waivers



 


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hereunder, or in
any certificate, report, financial statement or other document submitted to the
Administrative Agent or the Lenders by any Loan Party or any representative of any Loan Party
pursuant to or in connection with this Agreement or any other Loan Document shall prove to be
incorrect when made or deemed made or submitted; or



(d) the Borrower shall fail to observe or perform any covenant or agreement contained in
Sections 5.1, 5.2, or 5.3 (with respect to the Borrower’s existence) or in
Articles VI or VII; or



(e) any Loan Party shall fail to observe or perform any covenant or agreement contained in
this Agreement (other than those referred to in clauses (a), (b) and (d) above or any other Loan
Document), and such failure shall remain unremedied for 30 days after the earlier of (i) any
officer of the Borrower becomes aware of such failure, or (ii) notice thereof shall have been given
to the Borrower by the Administrative Agent or any Lender; or



(f) a Borrowing Base Deficiency shall occur and continue unremedied for a period of five or
more Business Days after delivery of a Borrowing Base Certificate demonstrating such Borrowing Base
Deficiency pursuant to Section 5.1(f); or



(g) the Borrower or any Subsidiary (whether as primary obligor or as guarantor or other
surety) shall fail to pay any principal of or premium or interest on any Material Indebtedness that
is outstanding, when and as the same shall become due and payable (whether at scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument evidencing or governing
such Material Indebtedness; or any other event shall occur or condition shall exist under any
agreement or instrument relating to such Material Indebtedness and shall continue after the
applicable grace period, if any, specified in such agreement or instrument, if the effect of such
event or condition is to accelerate, or permit the acceleration of, the maturity of such
Indebtedness; or any such Material Indebtedness shall be declared to be due and payable; or
required to be prepaid or redeemed (other than by a regularly scheduled required prepayment or
redemption), purchased or defeased, or any offer to prepay, redeem, purchase or defease such
Material Indebtedness shall be required to be made, in each case prior to the stated maturity
thereof; or



(h) the Borrower or any Subsidiary shall (i) commence a voluntary case or other proceeding or
file any petition seeking liquidation, reorganization or other relief under any federal, state or
foreign bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the
appointment of a custodian, trustee, receiver, liquidator or other similar official of it or any
substantial part of its property, (ii) consent to the institution of, or fail to contest in a
timely and appropriate manner, any proceeding or petition described in clause (i) of this
Section 8.1, (iii) apply for or consent to the appointment of a custodian, trustee,
receiver, liquidator or other similar official for the Borrower or any such Subsidiary or for a
substantial part of its assets, (iv) file an answer admitting the material allegations of a
petition filed against it in any such proceeding, (v) make a general assignment for the benefit of
creditors, or (vi) take any action for the purpose of effecting any of the foregoing; or



(i) an involuntary proceeding shall be commenced or an involuntary petition shall be filed
seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any
Subsidiary or its debts, or any substantial part of its assets, under any federal, state or
foreign bankruptcy, insolvency or other similar law now or hereafter in effect or (ii) the
appointment of a custodian, trustee, receiver, liquidator or other similar official for the
Borrower or any Subsidiary or for a substantial part of its assets,



 


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and in any such case, such
proceeding or petition shall remain undismissed for a period of 60 days or an order or decree
approving or ordering any of the foregoing shall be entered; or



(j) the Borrower or any Subsidiary shall become unable to pay, shall admit in writing its
inability to pay, or shall fail to pay, its debts as they become due; or



(k) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when
taken together with other ERISA Events that have occurred, could reasonably be expected to result
in liability to the Borrower and the Subsidiaries in an aggregate amount exceeding $1,000,000; or



(l) any judgment or order for the payment of money in excess of $5,000,000 in the aggregate
shall be rendered against the Borrower or any Subsidiary, and either (i) enforcement proceedings
shall have been commenced by any creditor upon such judgment or order or (ii) there shall be a
period of 30 consecutive days during which a stay of enforcement of such judgment or order, by
reason of a pending appeal or otherwise, shall not be in effect; or



(m) any non-monetary judgment or order shall be rendered against the Borrower or any
Subsidiary that could reasonably be expected to have a Material Adverse Effect, and there shall be
a period of 30 consecutive days during which a stay of enforcement of such judgment or order, by
reason of a pending appeal or otherwise, shall not be in effect; or




(n) a Change in Control shall occur or exist;



(o) the Liens created by the Security Documents shall, at any time, not be valid and perfected
(to the extent perfection by filing, registration, recordation, possession or control is required
herein or therein) in favor of the Administrative Agent, free and clear of all other Liens (other
than Permitted Encumbrances); or



(p) any provision of any Security Document shall for any reason cease to be valid and binding
on, or enforceable against, any Subsidiary Guarantor or the Borrower, as applicable, or any
Subsidiary Guarantor or the Borrower shall so state in writing, any Subsidiary Guarantor or the
Borrower shall seek to terminate any Security Document;



then, and in every such event (other than an event with respect to the Borrower described in clause
(g) or (h) of this Section 8.1) and at any time thereafter during the continuance of such
event, the Administrative Agent may, and upon the written request of the Required Lenders shall, by
notice to the Borrower, take any or all of the following actions, at the same or different times:
(i) terminate the Commitments, whereupon the Commitment of each Lender shall terminate immediately;
(ii) declare the principal of and any accrued interest on the Loans, and all other Obligations
owing hereunder, to be, whereupon the same shall become due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are hereby waived by the
Borrower; (iii) exercise all remedies contained in any other Loan Document and (iv) exercise any
other remedies available at law or equity; and that, if an Event of Default specified in either
clause (g) or (h) shall occur, the Commitments shall automatically terminate and the principal of
the Loans then outstanding, together with accrued interest thereon, and all fees, and all other
Obligations shall automatically become due and payable, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower.


 


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ARTICLE IX




THE ADMINISTRATIVE AGENT




Section 9.1. Appointment of Administrative Agent. Each Lender irrevocably appoints
SunTrust Bank as the Administrative Agent and authorizes it to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent under this Agreement and the
other Loan Documents, together with all such actions and powers that are reasonably incidental
thereto. The Administrative Agent may perform any of its duties hereunder or under the other Loan
Documents by or through any one or more sub-agents or attorneys-in-fact appointed by the
Administrative Agent. The Administrative Agent and any such sub-agent or attorney-in-fact may
perform any and all of its duties and exercise its rights and powers through their respective
Related Parties. The exculpatory provisions set forth in this Article shall apply to any such
sub-agent or attorney-in-fact and the Related Parties of the Administrative Agent, any such
sub-agent and any such attorney-in-fact and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as well as activities
as Administrative Agent.



Section 9.2. Nature of Duties of Administrative Agent. The Administrative Agent shall
not have any duties or obligations except those expressly set forth in this Agreement and the other
Loan Documents. Without limiting the generality of the foregoing, (a) the Administrative Agent
shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or
an Event of Default has occurred and is continuing, (b) the Administrative Agent shall not have any
duty to take any discretionary action or exercise any discretionary powers, except those
discretionary rights and powers expressly contemplated by the Loan Documents that the
Administrative Agent is required to exercise in writing by the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the circumstances as provided in
Section 10.2), and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure
to disclose, any information relating to the Borrower or any of its Subsidiaries that is
communicated to or obtained by the Administrative Agent or any of its Affiliates in any capacity.
The Administrative Agent shall not be liable for any action taken or not taken by it, its
sub-agents or attorneys-in-fact with the consent or at the request of the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the circumstances as provided
in Section 10.2) or in the absence of its own gross negligence or willful misconduct. The
Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents or
attorneys-in-fact selected by it with reasonable care. The Administrative Agent shall not be
deemed to have knowledge of any Default or Event of Default unless and until written notice thereof
(which notice shall include an express reference to such event being a “Default” or “Event of
Default” hereunder) is given to the Administrative Agent by the Borrower or any Lender, and the
Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i)
any statement, warranty or representation made in or in connection with any Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or thereunder or in
connection herewith or therewith, (iii) the performance or observance of any of the covenants,
agreements, or other terms and conditions set forth in any Loan Document, (iv) the validity,
enforceability, effectiveness or genuineness of any Loan Document or any other agreement,
instrument or document, or (v) the satisfaction of any condition set forth in Article III or
elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent. The Administrative Agent may consult with legal counsel
(including counsel for the Borrower) concerning all matters pertaining to such duties.



Section 9.3. Lack of Reliance on the Administrative Agent. Each of the Lenders and
the Swingline Lender acknowledges that it has, independently and without reliance upon the



 


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Administrative Agent or any other Lender and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each
of the Lenders and the Swingline Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, continue to make its own decisions in taking or not
taking of any action under or based on this Agreement, any related agreement or any document
furnished hereunder or thereunder.



Section 9.4. Certain Rights of the Administrative Agent. If the Administrative Agent
shall request instructions from the Required Lenders with respect to any action or actions
(including the failure to act) in connection with this Agreement, the Administrative Agent shall be
entitled to refrain from such act or taking such act, unless and until it shall have received
instructions from such Lenders; and the Administrative Agent shall not incur liability to any
Person by reason of so refraining. Without limiting the foregoing, no Lender shall have any right
of action whatsoever against the Administrative Agent as a result of the Administrative Agent
acting or refraining from acting hereunder in accordance with the instructions of the Required
Lenders where required by the terms of this Agreement.



Section 9.5. Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely upon, and shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing (including any electronic
message, posting or other distribution) believed by it to be genuine and to have been signed, sent
or made by the proper Person. The Administrative Agent may also rely upon any statement made to it
orally or by telephone and believed by it to be made by the proper Person and shall not incur any
liability for relying thereon. The Administrative Agent may consult with legal counsel (including
counsel for the Borrower), independent public accountants and other experts selected by it and
shall not be liable for any action taken or not taken by it in accordance with the advice of such
counsel, accountants or experts.



Section 9.6. The Administrative Agent in its Individual Capacity. The bank serving as
the Administrative Agent shall have the same rights and powers under this Agreement and any other
Loan Document in its capacity as a Lender as any other Lender and may exercise or refrain from
exercising the same as though it were not the Administrative Agent; and the terms “Lenders”,
“Required Lenders” or any similar terms shall, unless the context clearly otherwise indicates,
include the Administrative Agent in its individual capacity. The bank acting as the Administrative
Agent and its Affiliates may accept deposits from, lend money to, and generally engage in any kind
of business with the Borrower or any Subsidiary or Affiliate of the Borrower as if it were not the
Administrative Agent hereunder.




Section 9.7. Successor Administrative Agent.



(a) The Administrative Agent may resign at any time by giving notice thereof to the Lenders
and the Borrower. Upon any such resignation, the Required Lenders shall have the right to appoint
a successor Administrative Agent, subject to the approval by the Borrower provided that no Default
or Event of Default shall exist at such time. If no successor Administrative Agent shall have been
so appointed, and shall have accepted such appointment within 30 days after the retiring
Administrative Agent gives notice of resignation, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent, which shall be a commercial bank
organized under the laws of the United States of America or any state thereof or a bank which
maintains an office in the United States, having a combined capital and surplus of at least
$500,000,000.


 


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(b) Upon the acceptance of its appointment as the Administrative Agent hereunder by a
successor, such successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative Agent, and the
retiring Administrative Agent shall be discharged from its duties and obligations under this
Agreement and the other Loan Documents. If within 45 days after written notice is given of the
retiring Administrative Agent’s resignation under this Section 9.7 no successor
Administrative Agent shall have been appointed and shall have accepted such appointment, then on
such 45th day (i) the retiring Administrative Agent’s resignation shall become
effective, (ii) the retiring Administrative Agent shall thereupon be discharged
from its duties and obligations under the Loan Documents and (iii) the Required Lenders shall
thereafter perform all duties of the retiring Administrative Agent under the Loan Documents until
such time as the Required Lenders appoint a successor Administrative Agent as provided above.
After any retiring Administrative Agent’s resignation hereunder, the provisions of this Article IX
shall continue in effect for the benefit of such retiring Administrative Agent and its
representatives and agents in respect of any actions taken or not taken by any of them while it was
serving as the Administrative Agent.



(c) In addition to the foregoing, if a Lender becomes, and during the period it remains, a
Defaulting Lender, and if any Default has arisen from a failure of the Borrower to comply with
Section 2.23(a), then the Swingline Lender may, upon prior written notice to the Borrower
and the Administrative Agent, resign as Swingline Lender effective at the close of business
Atlanta, Georgia time on a date specified in such notice (which date may not be less than five
Business Days after the date of such notice).



Section 9.8. Withholding Tax. To the extent required by any applicable law, the Administrative
Agent may withhold from any interest payment to any Lender an amount equivalent to any applicable
withholding tax. If the Internal Revenue Service or any authority of the United States or other
jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form was not delivered,
was not properly executed, or because such Lender failed to notify the Administrative Agent of a
change in circumstances that rendered the exemption from, or reduction of, withholding tax
ineffective, or for any other reason), such Lender shall indemnify the Administrative Agent (to the
extent that the Administrative Agent has not already been reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so) fully for all amounts paid, directly or
indirectly, by the Administrative Agent as tax or otherwise, including penalties and interest,
together with all expenses incurred, including legal expenses, allocated staff costs and any out of
pocket expenses.




Section 9.9. Administrative Agent May File Proofs of Claim.



(a) In case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any
Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or any
Revolving Credit Exposure shall then be due and payable as herein expressed or by declaration or
otherwise and irrespective of whether the Administrative Agent shall have made any demand on the
Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise:




(i) to file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans or Revolving Credit Exposure and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary or advisable
in order to have the claims of the Lenders, Issuing Bank and the Administrative Agent
(including any claim for the reasonable compensation, expenses, disbursements and advances
of the Lenders, Issuing Bank and the Administrative Agent and its agents and counsel and all
other



 


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amounts due the Lenders, Issuing Bank and the Administrative Agent under Section
10.3) allowed in such judicial proceeding; and




(ii) to collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same; and



(b) Any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar
official in any such judicial proceeding is hereby authorized by each Lender and the Issuing Bank
to make such payments to the Administrative Agent and, if the Administrative Agent shall consent to
the making of such payments directly to the Lenders and the Issuing Bank, to pay to the
Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and
advances of the Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Section 10.3.



Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or
consent to or accept or adopt on behalf of any Lender or the Issuing Bank any plan of
reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of
any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender
in any such proceeding.



Section 9.10. Authorization to Execute other Loan Documents Each Lender hereby
authorizes the Administrative Agent to execute on behalf of all Lenders (a) all Loan Documents
other than this Agreement, (b) any release of the guaranty of a Subsidiary Guarantor to the extent
expressly permitted by this Agreement, and (c) any release of collateral to the extent expressly
permitted by this Agreement.



Section 9.11. Syndication Agent and Documentation Agent. Each Lender hereby
designates Citibank, NA as Syndication Agent and agrees that the Syndication Agent shall have no
duties or obligations under any Loan Documents to any Lender or any Loan Party. Each Lender hereby
designates UBS Securities LLC as Documentation Agent and agrees that the Documentation Agent shall
have no duties or obligations under any Loan Documents to any Lender or any Loan Party.



Section 9.12. Approved Third Party Appraiser Release. Each Lender hereby agrees to
deliver to the Approved Third Party Appraiser a release, in substantially the form attached hereto
as Exhibit 9.10, prior to becoming a Lender hereunder.



ARTICLE X




MISCELLANEOUS





Section 10.1. Notices.




(a) Written Notices.




(i) Except in the case of notices and other communications expressly permitted to be
given by telephone, all notices and other communications to any party herein to be effective
shall be in writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by telecopy, as follows:



	 	 	 
	To the Borrower:

	 	Kayne Anderson Energy Development Company
	 

	 	717 Texas Avenue, Suite 3100






 


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	 	Houston, Texas 77002
	 

	 	Attention: Terry Hart
	 

	 	Telecopy Number: (713) 655-7359
	 
	 	 
	With a copy to:

	 	Paul, Hastings, Janofsky & Walker LLP
	 

	 	55 Second Street
	 

	 	San Francisco, California 94105
	 

	 	Attention: David Hearth
	 

	 	Telecopy Number: (415) 856-7100
	 
	 	 
	To the Administrative Agent 

or Swingline Lender:

	 	 

SunTrust Bank
	 

	 	303 Peachtree Street, N. E.
	 

	 	Atlanta, Georgia 30308
	 

	 	Attention:
	 

	 	Telecopy Number:
	 
	 	 
	With a copy to:

	 	SunTrust Bank
	 

	 	Agency Services
	 

	 	303 Peachtree Street, N. E./ 25th Floor
	 

	 	Atlanta, Georgia 30308
	 

	 	Attention: Mr. Doug Weltz
	 

	 	Telecopy Number: (404) 221-2001
	 
	 	 
	 

	 	and
	 
	 	 
	 

	 	King & Spalding LLP
	 

	 	1180 Peachtree Street, N.W.
	 

	 	Atlanta, Georgia 30309
	 

	 	Attention: Todd Holleman
	 

	 	Telecopy Number: (404) 572-5100
	 
	 	 
	To any other Lender:

	 	the address set forth in the Administrative
Questionnaire or the Assignment and Acceptance Agreement executed by such
Lender






Any party hereto may change its address or telecopy number for notices and other communications
hereunder by notice to the other parties hereto. All such notices and other communications shall,
when transmitted by overnight delivery, or faxed, be effective when delivered for overnight
(next-day) delivery, or transmitted in legible form by facsimile machine, respectively, or if
mailed, upon the third Business Day after the date deposited into the mail or if delivered, upon
delivery; provided, that notices delivered to the Administrative Agent or the Swingline Lender
shall not be effective until actually received by such Person at its address specified in this
Section 10.1.




(ii) Any agreement of the Administrative Agent and the Lenders herein to receive
certain notices by telephone or facsimile is solely for the convenience and at the request
of the Borrower. The Administrative Agent and the Lenders shall be entitled to rely on the
authority of any Person purporting to be a Person authorized by the Borrower to give such
notice and the Administrative Agent and Lenders shall not have any liability to the Borrower
or other Person on account of any action taken or not taken by the Administrative Agent or
the Lenders in reliance



 


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upon such telephonic or facsimile notice. The obligation of the
Borrower to repay the Loans and all other Obligations hereunder shall not be affected in any
way or to any extent by any failure of the Administrative Agent and the Lenders to receive
written confirmation of any telephonic or facsimile notice or the receipt by the
Administrative Agent and the Lenders of a confirmation which is at variance with the terms
understood by the Administrative Agent and the Lenders to be contained in any such
telephonic or facsimile notice.



(b) Electronic Communications.




(i) Notices and other communications to the Lenders hereunder may be delivered or
furnished by electronic communication (including e-mail and Internet or intranet websites)
pursuant to procedures approved by Administrative Agent, provided that the foregoing
shall not apply to notices to any Lender pursuant to Article II unless such Lender
and Administrative Agent have agreed to receive notices under such Section by electronic
communication and have agreed to the procedures governing such communications.
Administrative Agent or Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to procedures approved
by it; provided that approval of such procedures may be limited to particular
notices or communications.




(ii) Unless Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the sender’s receipt
of an acknowledgement from the intended recipient (such as by the “return receipt requested”
function, as available, return e-mail or other written acknowledgement); provided
that if such notice or other communication is not sent during the normal business hours of
the recipient, such notice or communication shall be deemed to have been sent at the opening
of business on the next Business Day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the deemed receipt
by the intended recipient at its e-mail address as described in the foregoing clause (i) of
notification that such notice or communication is available and identifying the website
address therefor.



(c) The Administrative Agent shall execute, without further consent or approval of any Lender,
so long as no Default or Event of Default shall have occurred which is continuing or would result
therefrom (i) a release of the guaranty of a Subsidiary upon the sale or other disposition of such
Subsidiary permitted under the terms of this Agreement or pursuant to any consent or approval by
Required Lenders and (ii) a release of collateral upon the sale or other disposition of such
collateral permitted under the terms of this Agreement or pursuant to any consent or approval by
Required Lenders.




Section 10.2. Waiver; Amendments.



(a) No failure or delay by the Administrative Agent or any Lender in exercising any right or
power hereunder or any other Loan Document, and no course of dealing between the Borrower and the
Administrative Agent or any Lender, shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power or any abandonment or discontinuance of steps to
enforce such right or power, preclude any other or further exercise thereof or the exercise of any
other right or power hereunder or thereunder. The rights and remedies of the Administrative Agent
and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive
of any rights or remedies provided by law. No waiver of any provision of this Agreement or any
other Loan Document or consent to any departure by the Borrower therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section 10.2, and
then such waiver or consent shall be effective only in the specific instance and for the purpose
for which given. Without limiting the generality of the



 


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foregoing, the making of a Loan shall not
be construed as a waiver of any Default or Event of Default, regardless of whether the
Administrative Agent or any Lender may have had notice or knowledge of such Default or Event of
Default at the time.



(b) No amendment or waiver of any provision of this Agreement or the other Loan Documents, nor
consent to any departure by the Borrower therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Borrower and the Required Lenders or the Borrower and the
Administrative Agent with the consent of the Required Lenders and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for which given;
provided, that
no amendment or waiver shall: (i) increase the Commitment of any Lender without the written
consent of such Lender, (ii) reduce the principal amount of any Loan or reduce the rate of interest
thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected
thereby, (iii) postpone the date fixed for any payment of any principal of, or interest on, any
Loan or interest thereon or any fees hereunder or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date for the termination or reduction of any Commitment, without
the written consent of each Lender affected thereby, (iv) change Section 2.19 (b) or (c)
in a manner that would alter the pro rata sharing of payments required thereby, without the written
consent of each Lender, (v) change any of the provisions of this Section 10.2 or the
definition of “Required Lenders” or any other provision hereof specifying the number or percentage
of Lenders which are required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the consent of each Lender; (vi) release all
or substantially all of the guarantors or limit the liability of any such guarantors under any
guaranty agreement, without the written consent of each Lender; (vii) modify or adjust the
definition of “Borrowing Base” or any defined term used therein, except for reductions in advance
rates, impositions of reserves and reductions in eligibility standards that the Administrative
Agent is permitted to make pursuant to such definitions, without the consent of the Required
Lenders; or (viii) release all or substantially all collateral (if any) securing any of the
Obligations, without the written consent of each Lender; provided further, that no
such agreement shall amend, modify or otherwise affect the rights, duties or obligations of the
Administrative Agent or the Swingline Lender without the prior written consent of such Person.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of
such Lender may not be increased or extended, and amounts payable to such Lender hereunder may not
be permanently reduced without the consent of such Lender (other than reductions in fees and
interest in which such reduction does not disproportionately affect such Lender). Notwithstanding
anything contained herein to the contrary, this Agreement may be amended and restated without the
consent of any Lender (but with the consent of the Borrower and the Administrative Agent) if, upon
giving effect to such amendment and restatement, such Lender shall no longer be a party to this
Agreement (as so amended and restated), the Commitments of such Lender shall have terminated (but
such Lender shall continue to be entitled to the benefits of Sections 2.16, 2.17,
2.18 and 10.3), such Lender shall have no other commitment or other obligation
hereunder and shall have been paid in full all principal, interest and other amounts owing to it or
accrued for its account under this Agreement. Notwithstanding anything contained herein to the
contrary, the Administrative Agent may release certain collateral in connection with
securitizations or other third party financings entered into with financing subsidiaries,
provided that (i) the Borrower is in compliance with the Borrowing Base, (ii) the
Administrative Agent has completed a satisfactory review of the Company’s loan portfolio, supported
by the most recent third party prepared evaluation, and (iii) either (x) the amount of any
Borrowing Availability under the Borrowing Base immediately prior to such release is not diminished
as a result of such release or (y) the Borrowing Base immediately after giving effect to such
release is at least 110% of the Revolving Credit Exposure.


 


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Section 10.3. Expenses; Indemnification.



(a) The Borrower shall pay (i) all reasonable, out-of-pocket costs and expenses of the
Administrative Agent and its Affiliates, including the reasonable fees, charges and disbursements
of counsel for the Administrative Agent and its Affiliates, in connection with the syndication of
the credit facilities provided for herein, the preparation and administration of the Loan Documents
and any amendments, modifications or waivers thereof (whether or not the transactions contemplated
in this Agreement or any other Loan Document shall be consummated) and (ii) all out-of-pocket costs
and expenses (including, without limitation, the reasonable fees, charges and disbursements of
outside counsel) incurred by the Administrative Agent or any Lender in connection with the
enforcement or protection
of its rights in connection with this Agreement, including its rights under this Section
10.3, or in connection with the Loans made hereunder, including all such out-of-pocket expenses
incurred during any workout, restructuring or negotiations in respect of such Loans.



(b) The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each
Lender, and each Related Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses (including the fees, charges and disbursements of any
counsel for any Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees
and time charges and disbursements for attorneys who may be employees of any Indemnitee, incurred
by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrower or any
other Loan Party arising out of, in connection with, or as a result of (i) the execution or
delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto of their respective obligations hereunder
or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan
or the use or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or
Release of Hazardous Materials on or from any property owned or operated by the Borrower or any of
its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other theory, whether
brought by a third party or by the Borrower or any other Loan Party, and regardless of whether any
Indemnitee is a party thereto, provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related
expenses (x) are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of any Indemnitee or (y)
result from a claim brought by the Borrower or any other Loan Party against an Indemnitee for
breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if
the Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction. No Indemnitee shall be liable for
any damages arising from the use by others of any information or other materials obtained through
Syntrak or any other Internet or intranet website, except as a result of such Indemnitee’s gross
negligence or willful misconduct as determined by a court of competent jurisdiction in a final and
nonappealable judgment



(c) The Borrower shall pay, and hold the Administrative Agent and each of the Lenders harmless
from and against, any and all present and future stamp, documentary, and other similar taxes with
respect to this Agreement and any other Loan Documents, any collateral described therein, or any
payments due thereunder, and save the Administrative Agent and each Lender harmless from and
against any and all liabilities with respect to or resulting from any delay or omission to pay such
taxes.



(d) To the extent that the Borrower fails to pay any amount required to be paid to the
Administrative Agent or the Swingline Lender under clauses (a), (b) or (c) hereof, each Lender
severally



 


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agrees to pay to the Administrative Agent or the Swingline Lender, as the case may be,
such Lender’s Pro Rata Share (determined as of the time that the unreimbursed expense or indemnity
payment is sought) of such unpaid amount; provided, that the unreimbursed expense or
indemnified payment, claim, damage, liability or related expense, as the case may be, was incurred
by or asserted against the Administrative Agent or the Swingline Lender in its capacity as such.



(e) To the extent permitted by applicable law, the Borrower shall not assert, and hereby
waives, any claim against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to actual or direct damages) arising out of, in
connection
with or as a result of, this Agreement or any agreement or instrument contemplated hereby, the
transactions contemplated therein, any Loan or the use of proceeds thereof.



(f) All amounts due under this Section 10.3 shall be payable promptly after written
demand therefor.




Section 10.4. Successors and Assigns.



(a) The provisions of this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns permitted hereby, except that the
Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without
the prior written consent of the Administrative Agent and each Lender, and no Lender may assign or
otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in
accordance with the provisions of paragraph (b) of this Section, (ii) by way of participation in
accordance with the provisions of paragraph (d) of this Section or (iii) by way of pledge or
assignment of a security interest subject to the restrictions of paragraph (f) of this Section (and
any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the
parties hereto, their respective successors and assigns permitted hereby, Participants to the
extent provided in paragraph (d) of this Section and, to the extent expressly contemplated hereby,
the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.



(b) Any Lender may at any time assign to one or more assignees all or a portion of its rights
and obligations under this Agreement (including all or a portion of its Commitment and the Loans at
the time owing to it); provided that any such assignment shall be subject to the following
conditions:




(i) Minimum Amounts.




(A) in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment and the Loans at the time owing to it or in the case
of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no
minimum amount need be assigned; and




(B) in any case not described in paragraph (b)(i)(A) of this Section, the
aggregate amount of the Commitment (which for this purpose includes Loans and
Revolving Credit Exposure outstanding thereunder) or, if the applicable Commitment
is not then in effect, the principal outstanding balance of the Loans and Revolving
Credit Exposure of the assigning Lender subject to each such assignment (determined
as of the date the Assignment and Acceptance with respect to such assignment is
delivered to the Administrative Agent or, if “Trade Date” is specified in the
Assignment and Acceptance, as of the Trade Date) shall not be less than $1,000,000,
unless each of the Administrative



 


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Agent and, so long as no Event of Default has
occurred and is continuing, the Borrower otherwise consents (each such consent not
to be unreasonably withheld or delayed).




(ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Agreement with respect to the Loans, Revolving Credit Exposure or the Commitment
assigned, except that this clause (ii) shall not prohibit any Lender from assigning all or a
portion of its rights and obligations among separate Commitments on a non-pro rata basis.




(iii) Required Consents. No consent shall be required for any assignment
except to the extent required by paragraph (b)(i)(B) of this Section and, in addition:




(A) the consent of the Borrower (such consent not to be unreasonably withheld
or delayed) shall be required unless (x) an Event of Default has occurred and is
continuing at the time of such assignment or (y) such assignment is to a Lender, an
Affiliate of a Lender or an Approved Fund provided, that, the
Borrower shall be deemed to have consented to any such assignment unless it shall
object thereto by written notice to the Administrative Agent within five (5)
Business Days after having received notice thereof;




(B) the consent of the Administrative Agent (such consent not to be
unreasonably withheld or delayed) shall be required for assignments to a Person that
is not a Lender with a Commitment; and




(C) the consent of the Swingline Lender (such consent not to be unreasonably
withheld or delayed) shall be required for any assignment in respect of the
Revolving Commitments.




(iv) Assignment and Acceptance. The parties to each assignment shall deliver
to the Administrative Agent (A) a duly executed Assignment and Acceptance, (B) a processing
and recordation fee of $3,500, (C) an Administrative Questionnaire unless the assignee is
already a Lender and (D) the documents required under Section 2.18 if such assignee
is a Foreign Lender.




(v) No Assignment to Borrower. No such assignment shall be made to the
Borrower or any of the Borrower’s Affiliates or Subsidiaries.




(vi) No Assignment to Natural Persons. No such assignment shall be made to a
natural person.




(vii) Approved Third Party Appraiser Release. The successor or assignee to any
assignment, if such successor or assignee is not a Lender, shall execute and deliver to the
Approved Third Party Appraiser a release in substantially the form of Exhibit 9.10
hereto.



Subject to acceptance and recording thereof by the Administrative Agent pursuant to paragraph (c)
of this Section 10.4, from and after the effective date specified in each Assignment and
Acceptance, the assignee thereunder shall be a party to this Agreement and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and
obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Sections 2.16, 2.17, 2.18 and
10.3 with respect to facts and circumstances occurring prior to the effective date of such



 


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assignment. Any assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale
by such Lender of a participation in such rights and obligations in accordance with paragraph (d)
of this Section 10.4. If the consent of the Borrower to an assignment is required
hereunder (including a consent to an assignment which does not meet the minimum assignment
thresholds specified above), the Borrower shall be deemed to have given its consent five Business
Days after the date notice thereof has actually been delivered by the assigning Lender (through the
Administrative Agent) to the Borrower, unless such consent is expressly refused by the Borrower
prior to such fifth Business Day.



(c) The Administrative Agent, acting solely for this purpose as an agent of the Borrower,
shall maintain at one of its offices in Atlanta, Georgia a copy of each Assignment and Acceptance
delivered to it and a register for the recordation of the names and addresses of the Lenders, and
the Commitments of, and principal amount of the Loans and Revolving Credit Exposure owing to, each
Lender pursuant to the terms hereof from time to time (the “Register”). Information contained in
the Register with respect to any Lender shall be available for inspection by such Lender at any
reasonable time and from time to time upon reasonable prior notice; information contained in the
Register shall also be available for inspection by the Borrower at any reasonable time and from
time to time upon reasonable prior notice. In establishing and maintaining the Register,
Administrative Agent shall serve as Borrower’s agent solely for tax purposes and solely with
respect to the actions described in this Section, and the Borrower hereby agrees that, to
the extent SunTrust Bank serves in such capacity, SunTrust Bank and its officers, directors,
employees, agents, sub-agents and affiliates shall constitute “Indemnitees.”



(d) Any Lender may at any time, without the consent of, or notice to, the Borrower, the
Administrative Agent or the Swingline Lender sell participations to any Person (other than a
natural person, the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a
“Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans owing to it); provided that
(i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of such obligations and
(iii) the Borrower, the Administrative Agent, the Lenders and the Swingline Lender shall continue
to deal solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.



Any agreement or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver with respect to the following to the
extent affecting such Participant: (i) increase the Commitment of any Lender without the written
consent of such Lender, (ii) reduce the principal amount of any Loan or reduce the rate of interest
thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected
thereby, (iii) postpone the date fixed for any payment of any principal of, or interest on, any
Loan or interest thereon or any fees hereunder or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date for the termination or reduction of any Commitment, without
the written consent of each Lender affected thereby, (iv) change Section 2.19(b) or
(c) in a manner that would alter the pro rata sharing of payments required thereby, without
the written consent of each Lender, (v) change any of the provisions of this Section 10.4
or the definition of “Required Lenders” or any other provision hereof specifying the number or
percentage of Lenders which are required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the consent of each Lender; (vi) release any
guarantor or limit the liability of any such guarantor under any guaranty agreement without the
written consent of each Lender except to the extent such release is expressly provided under the
terms of the such guaranty agreement; or



 


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(vii) release all or substantially all collateral (if any)
securing any of the Obligations. Subject to paragraph (e) of this Section 10.4, the
Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.16,
2.17, and 2.18 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section 10.4. To the extent
permitted by law, each Participant also shall be entitled to the benefits of Section 10.7
as though it were a Lender, provided such Participant agrees to be subject to Section 2.19
as though it were a Lender.



(e) A Participant shall not be entitled to receive any greater payment under Section
2.16 and Section 2.18 than the applicable Lender would have been entitled to receive
with respect to the
participation sold to such Participant, unless the sale of the participation to such
Participant is made with the Borrower’s prior written consent. A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.18
unless the Borrower is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 2.18(e) as though it were a
Lender.



(f) Any Lender may at any time pledge or assign a security interest in all or any portion of
its rights under this Agreement to secure obligations of such Lender, including without limitation
any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no
such pledge or assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.




Section 10.5. Governing Law; Jurisdiction; Consent to Service of Process.



(a) This Agreement and the other Loan Documents shall be construed in accordance with and be
governed by the law (without giving effect to the conflict of law principles thereof) of the State
of New York.



(b) The Borrower hereby irrevocably and unconditionally submits, for itself and its property,
to the exclusive jurisdiction of the United States District Court of the Southern District of New
York, and of any state court of the State of New York sitting in New York County and any appellate
court from any thereof, in any action or proceeding arising out of or relating to this Agreement or
any other Loan Document or the transactions contemplated hereby or thereby, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard and determined in
such New York state court or, to the extent permitted by applicable law, such Federal court. Each
of the parties hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any right
that the Administrative Agent or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or any other Loan Document against the Borrower or its properties in the
courts of any jurisdiction.



(c) The Borrower irrevocably and unconditionally waives any objection which it may now or
hereafter have to the laying of venue of any such suit, action or proceeding described in paragraph
(b) of this Section 10.5 and brought in any court referred to in paragraph (b) of this
Section 10.5. Each of the parties hereto irrevocably waives, to the fullest extent
permitted by applicable law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.



(d) Each party to this Agreement irrevocably consents to the service of process in the manner
provided for notices in Section 10.1. Nothing in this Agreement or in any other Loan
Document will affect the right of any party hereto to serve process in any other manner permitted
by law.


 


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Section 10.6. WAIVER OF JURY TRIAL. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.6.



Section 10.7. Right of Setoff. In addition to any rights now or hereafter granted
under applicable law and not by way of limitation of any such rights, each Lender shall have the
right, at any time or from time to time upon the occurrence and during the continuance of an Event
of Default, without prior notice to the Borrower, any such notice being expressly waived by the
Borrower to the extent permitted by applicable law, to set off and apply against all deposits
(general or special, time or demand, provisional or final) of the Borrower at any time held or
other obligations at any time owing by such Lender to or for the credit or the account of the
Borrower against any and all Obligations held by such Lender irrespective of whether such Lender
shall have made demand hereunder and although such Obligations may be unmatured. Each Lender agrees
promptly to notify the Administrative Agent and the Borrower after any such set-off and any
application made by such Lender; provided, that the failure to give such notice shall not
affect the validity of such set-off and application. Each Lender agrees to apply all amounts
collected from any such set-off to the Obligations before applying such amounts to any other
Indebtedness or other obligations owed by the Borrower and any of its Subsidiaries to such Lender.



Section 10.8. Counterparts; Integration. This Agreement may be executed by one or
more of the parties to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to constitute one and the
same instrument. This Agreement, the Fee Letter, the other Loan Documents, and any separate letter
agreement(s) relating to any fees payable to the Administrative Agent and its Affiliates constitute
the entire agreement among the parties hereto and thereto and their affiliates regarding the
subject matters hereof and thereof and supersede all prior agreements and understandings, oral or
written, regarding such subject matters. Delivery of an executed counterpart to this Agreement or
any other Loan Document by facsimile transmission or by electronic mail in pdf form shall be as
effective as delivery of a manually executed counterpart hereof.



Section 10.9. Survival. All covenants, agreements, representations and warranties
made by the Borrower herein and in the certificates or other instruments delivered in connection
with or pursuant to this Agreement shall be considered to have been relied upon by the other
parties hereto and shall survive the execution and delivery of this Agreement and the making of
any Loans, regardless of any investigation made by any such other party or on its behalf and
notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any accrued interest on any
Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so
long as the Commitments have not expired or terminated. The provisions of Sections 2.16,
2.17, 2.18, and 10.3 and Article IX shall survive and remain in full force
and effect regardless of the consummation of the transactions contemplated hereby, the repayment of
the Loans, the expiration or termination of the Commitments or the termination



 


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of this Agreement or
any provision hereof. All representations and warranties made herein, in the certificates,
reports, notices, and other documents delivered pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the other Loan Documents, and the making of the Loans.



Section 10.10. Severability. Any provision of this Agreement or any other Loan
Document held to be illegal, invalid or unenforceable in any jurisdiction, shall, as to such
jurisdiction, be ineffective to the extent of such illegality, invalidity or unenforceability
without affecting the legality, validity or enforceability of the remaining provisions hereof or
thereof; and the illegality, invalidity or
unenforceability of a particular provision in a particular jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.



Section 10.11. Confidentiality. Each of the Administrative Agent and each Lender
agrees to take normal and reasonable precautions to maintain the confidentiality of any information
designated in writing as confidential and provided to it by the Borrower or any Subsidiary, except
that such information may be disclosed (i) to any Related Party of the Administrative Agent or any
such Lender, including without limitation accountants, legal counsel and other advisors, (ii) to
the extent required by applicable laws or regulations or by any subpoena or similar legal process,
(iii) to the extent requested by any regulatory agency or authority, (iv) to the extent that such
information becomes publicly available other than as a result of a breach of this Section
10.11, or which becomes available to the Administrative Agent, any Lender or any Related Party
of any of the foregoing on a nonconfidential basis from a source other than the Borrower, (v) in
connection with the exercise of any remedy hereunder or any suit, action or proceeding relating to
this Agreement or the enforcement of rights hereunder, (vi) subject to provisions substantially
similar to this Section 10.11, to any actual or prospective assignee or Participant, or
(vii) with the consent of the Borrower. Any Person required to maintain the confidentiality of any
information as provided for in this Section 10.11 shall be considered to have complied with
its obligation to do so if such Person has exercised the same degree of care to maintain the
confidentiality of such information as such Person would accord its own confidential information.



Section 10.12. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges
and other amounts which may be treated as interest on such Loan under applicable law (collectively,
the “Charges”), shall exceed the maximum lawful rate of interest (the “Maximum Rate”) which may be
contracted for, charged, taken, received or reserved by a Lender holding such Loan in accordance
with applicable law, the rate of interest payable in respect of such Loan hereunder, together with
all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent
lawful, the interest and Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section 10.12 shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Federal Funds Rate to the date of repayment (to the extent permitted by applicable
law), shall have been received by such Lender.



Section 10.13. Waiver of Effect of Corporate Seal. The Borrower represents and
warrants that neither it nor any other Loan Party is required to affix its corporate seal to this
Agreement or any other Loan Document pursuant to any Requirement of Law or regulation, agrees that
this Agreement is delivered by Borrower under seal and waives any shortening of the statute of
limitations that may result from not affixing the corporate seal to this Agreement or such other
Loan Documents.



Section 10.14. Patriot Act. The Administrative Agent and each Lender hereby notifies
the Loan Parties that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the “Patriot Act”), it is required to obtain, verify
and record



 


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information that identifies each Loan Party, which information includes the name and
address of such Loan Party and other information that will allow such Lender or the Administrative
Agent, as applicable, to identify such Loan Party in accordance with the Patriot Act.



Section 10.15. NO ORAL AGREEMENTS, WAIVER. THE LOAN DOCUMENTS EMBODY THE ENTIRE
AGREEMENT AND UNDERSTANDING BETWEEN THE PARTIES AND SUPERSEDE ALL OTHER AGREEMENTS AND
UNDERSTANDINGS BETWEEN SUCH PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF. THE LOAN
DOCUMENTS
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.



Section 10.16. Location of Closing. Each Lender acknowledges and agrees that it has
delivered, with the intent to be bound, its executed counterparts of this Agreement to the
Administrative Agent, c/o King & Spalding LLP, 1185 Avenue of the Americas, New York, New York
10036. Borrower acknowledges and agrees that it has delivered, with the intent to be bound, its
executed counterparts of this Agreement and each other Loan Document, together with all other
documents, instruments, opinions, certificates and other items required under Section 3.1,
to the Administrative Agent, c/o King & Spalding LLP, 1185 Avenue of the Americas, New York, New
York 10036. All parties agree that closing of the transactions contemplated by this Agreement has
occurred in New York.



Section 10.17. Existing Credit Agreement. Effective upon satisfaction of the
conditions set forth in Section 3.1, this Agreement amends, restates, supersedes and
replaces the Existing Credit Agreement in its entirety.



Section 10.18. Amendment and Restatement. This Agreement constitutes an amendment and
restatement of the Existing Credit Agreement and is not, and is not intended by the parties to be,
a novation of the Existing Credit Agreement. All rights and obligations of the parties shall
continue in effect, except as otherwise expressly set forth herein. Without limiting the
foregoing, no Default or Event of Default existing under the Existing Credit Agreement as of the
Closing Date shall be deemed waived or cured by this amendment and restatement thereof. The
Revolving Commitments of the Lenders under this Agreement after giving effect to this amendment and
restatement are set forth on Schedule II. On and after the Closing Date, all Revolving
Loans and other extensions of credit shall be made by the Lenders under this Agreement in
accordance with their respective Pro Rata Shares of the Revolving Commitments as in effect from
time to time. All references in the other Loan Documents to the Credit Agreement shall be deemed
to refer to and mean this Agreement, as the same may be further amended, supplemented, and restated
from time to time. On the Closing Date, all amounts outstanding under the Existing Credit
Agreement, together with all accrued and unpaid interest, fees and other amounts shall be
automatically paid in full by the initial Borrowing hereunder and the commitments of the Lenders
under the Existing Credit Agreement which are not parties to this Agreement to fund additional
advances shall terminate automatically.


 

(remainder of page left intentionally blank)


 


78









 





IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed under seal in
the case of the Borrower by their respective authorized officers as of the day and year first above
written.



	 	 	 	 	 
	 	KAYNE ANDERSON ENERGY

DEVELOPMENT COMPANY

 	 
	 	By:  	/s/ Terry Hart
 	 
	 	 	Name:  	Terry Hart 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



[SIGNATURE PAGE TO AMENDED AND RESTATED SENIOR SECURED

REVOLVING CREDIT AGREEMENT]




 


 









 







	 	 	 	 	 
	 	SUNTRUST BANK, as Administrative Agent, and 

as a Lender

 	 
	 	By:  	/s/ David Simpson
 	 
	 	 	Name:  	David Simpson 	 
	 	 	Title:  	Vice President 	 
	 



[SIGNATURE PAGE TO AMENDED AND RESTATED SENIOR SECURED

REVOLVING CREDIT AGREEMENT]




 


 









 







	 	 	 	 	 
	 	CITIBANK, NA, as a Lender

 	 
	 	By:  	/s/ John F. Miller
 	 
	 	 	Name:  	John F. Miller 	 
	 	 	Title:  	Attorney-in- Fact 	 
	 



[SIGNATURE PAGE TO AMENDED AND RESTATED SENIOR SECURED

REVOLVING CREDIT AGREEMENT]







 


 









 







	 	 	 	 	 
	 	UBS LOAN FINANCE LLC, as a Lender

 	 
	 	By:  	/s/ Irja R. Otsa
 	 
	 	 	Name:  	Irja R. Otsa 	 
	 	 	Title:  	Associate Director Banking Products Services, US 	 
	 
	 	 	 
	 	By:  	                        /s/ Michael Cerniglia
 	 
	 	 	Name:  	Michael Cerniglia 	 
	 	 	Title:  	Director Banking Products Services, US 	 
	 



[SIGNATURE PAGE TO AMENDED AND RESTATED SENIOR SECURED

REVOLVING CREDIT AGREEMENT]







 


 









 







	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A., as a Lender

 	 
	 	By:  	/s/ Jeanne Horn
 	 
	 	 	Name:  	Jeanne Horn 	 
	 	 	Title:  	Executive Director 	 
	 



[SIGNATURE PAGE TO AMENDED AND RESTATED SENIOR SECURED

REVOLVING CREDIT AGREEMENT]





 


 









 







	 	 	 	 	 
	 	STIFEL BANK & TRUST, as a Lender

 	 
	 	By:  	/s/ John H. Phillips
 	 
	 	 	Name:  	John H. Phillips 	 
	 	 	Title:  	Senior Vice President 	 
	 



[SIGNATURE PAGE TO AMENDED AND RESTATED SENIOR SECURED

REVOLVING CREDIT AGREEMENT]







 


 









 







Schedule I

COMMITMENT AMOUNTS




	 	 	 	 	 
	SunTrust Bank
	 	$	20,000,000	 
	 
	 	 	 	 
	Citibank, NA
	 	$	20,000,000	 
	 
	 	 	 	 
	UBS Loan Finance LLC
	 	$	18,000,000	 
	 
	 	 	 	 
	JPMorgan Chase Bank, N.A.
	 	$	7,000,000	 
	 
	 	 	 	 
	Stifel Bank & Trust
	 	$	5,000,000	 







 


 









 







SCHEDULE II




Approved Dealers and Appraisers




 


 









 







SCHEDULE III




Approved Brokerage Accounts




 


 









 







SCHEDULE 4.5




ENVIRONMENTAL MATTERS




Schedule I





 


 









 







SCHEDULE 4.10




INVESTMENT OBJECTIVE





 


 









 







SCHEDULE 4.15




SUBSIDIARIES




None


 


 









 





SCHEDULE 7.1




OUTSTANDING INDEBTEDNESS




 


 









 







SCHEDULE 7.2




EXISTING LIENS





 


 












 




EXHIBIT A




FORM OF ASSIGNMENT AND ACCEPTANCE




[date to be supplied]




Reference is made to the Amended and Restated Senior Secured Revolving Credit Agreement dated
as of March
 30, 2010 (as amended and in effect on the date hereof, the “Credit Agreement”),
among Kayne Anderson Energy Development Company, a Maryland corporation, the lenders from time to
time party thereto and SunTrust Bank, as Administrative Agent for such lenders. Terms defined in
the Credit Agreement are used herein with the same meanings.



The [name of assignor] (the “Assignor”) hereby sells and assigns, without recourse, to
[name of assignee] (the “Assignee”), and the Assignee hereby purchases and assumes, without
recourse, from the Assignor, effective as of the Assignment Date set forth below, the interests set
forth below (the “Assigned Interest”) in the Assignor’s rights and obligations under the
Credit Agreement, including, without limitation, the interests set forth below in the Revolving
Commitment of the Assignor on the Assignment Date and Revolving Loans owing to the Assignor which
are outstanding on the Assignment Date, together with the participations in the Swingline Exposure
of the Assignor on the Assignment Date, but excluding accrued interest and fees to and excluding
the Assignment Date. The Assignee hereby acknowledges receipt of a copy of the Credit Agreement.
From and after the Assignment Date (i) the Assignee shall be a party to and be bound by the
provisions of the Credit Agreement and, to the extent of the Assigned Interest, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent of the Assigned
Interest, relinquish its rights and be released from its obligations under the Credit Agreement.



This Assignment and Acceptance is being delivered to the Administrative Agent together with
(i) if the Assignee is a Foreign Lender, any documentation required to be delivered by the Assignee
pursuant to Section 2.18(e) of the Credit Agreement, duly completed and executed by the Assignee,
and (ii) if the Assignee is not already a Lender under the Credit Agreement, an Administrative
Questionnaire in the form supplied by the Administrative Agent, duly completed by the Assignee.
The Assignee shall pay the fee payable to the Administrative Agent pursuant to Section 10.4(b) of
the Credit Agreement.



The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the
Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other
adverse claim and (ii) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated
hereby, and (b) assumes no responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or any other Loan Document, (ii)
the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the Borrower, any of its
Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv)
the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Document.



The Assignee (a) represents and warrants that (i) it has full power and authority, and has
taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate
the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
meets all requirements of an Eligible Assignee under the Credit Agreement (subject to receipt of
such consents as may be required under the Credit Agreement), (iii) from and after the Effective
Date, it shall be bound by



 


A-1









 






the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the
Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy
of the Credit Agreement, together with copies of the most recent financial statements delivered
pursuant to Section 5.1 thereof, as applicable, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into this Assignment and
Acceptance and to purchase the Assigned Interest on the basis of which it has made such analysis
and decision independently and without reliance on the Administrative Agent or any other Lender,
and (v) if it is a Foreign Lender, attached to the Assignment and Acceptance is any documentation
required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and
executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on
the Administrative Agent, the Assignor or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.



From and after the Effective Date, the Administrative Agent shall make all payments in respect
of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the
Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for
amounts which have accrued from and after the Effective Date.



This Assignment and Acceptance shall be binding upon, and inure to the benefit of, the parties
hereto and their respective successors and assigns. This Assignment and Acceptance may be executed
in any number of counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Acceptance by telecopy shall be
effective as delivery of a manually executed counterpart of this Assignment and Acceptance. This
Assignment and Acceptance shall be governed by and construed in accordance with the laws of the
State of New York.



Assignment Date:



Legal Name of Assignor:



Legal Name of Assignee:



Assignee’s Address for Notices:



Effective Date of Assignment:

(“Effective Date”):


 


A-2









 





	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage Assigned of	 
	 	 	 	 	 	 	Revolving Commitment (set	 
	 	 	 	 	 	 	forth, to at least 8 decimals, as a	 
	 	 	 	 	 	 	percentage of the aggregate	 
	 	 	Principal Amount	 	 	Revolving Commitments of all	 
	Facility	 	Assigned	 	 	Lenders thereunder)	 
	 	 	 	 
	Revolving Loans:
	 	$	 	 	 	 	%	 






The terms set forth above are hereby agreed to:



	 	 	 	 	 	 	 
	 	 	[Name of Assignor], as Assignor	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	[Name of Assignee], as Assignee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 







 


A-3









 







The undersigned hereby consents to the within assignment1:



	 	 	 	 	 	 	 	 	 	 	 
	KAYNE ANDERSON ENERGY	 	 	 	SunTrust Bank, as Administrative Agent:
	DEVELOPMENT COMPANY	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 

Name:
	 	 
	 	 	 	 

Name:
	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 





 





	 	 	 
	1	 	Consents to be included to the extent required by
Section 10.4(b) of the Credit Agreement.





[SIGNATURE PAGE TO ASSIGNMENT AND ACCEPTANCE]





 


 









 










EXHIBIT B

SUBSIDIARY GUARANTY AGREEMENT




THIS SUBSIDIARY GUARANTY AGREEMENT (the “Agreement”), dated as of [DATE], each of the
subsidiaries of the Borrower listed on Schedule I hereto (each such subsidiary
individually, a “Guarantor” and collectively, the “Guarantors”) and SUNTRUST BANK,
a Georgia banking corporation, as administrative agent (the “Administrative Agent”) for the
several banks and other financial institutions (the “Lenders”) from time to time party to
the Amended and Restated Senior Secured Revolving Credit Agreement, dated as March 30, 2010, by
and among Kayne Anderson Energy Development Company, a Maryland corporation (the
“Borrower”),, the Lenders, the Administrative Agent, and SunTrust Bank, as Swingline Lender
(as amended, restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”; capitalized terms used herein and not otherwise defined herein shall the meanings
assigned to such terms in the Credit Agreement).



W I T N E S S E T H:




WHEREAS, pursuant to the Credit Agreement, the Lenders have agreed to established a revolving
credit facility in favor of the Borrower;



WHEREAS, each of the Guarantors is a direct or indirect Subsidiary of the Borrower and will
derive substantial benefit from the making of Loans by the Lenders; and



WHEREAS, Pursuant to Section 5.10 of the Credit Agreement, each Subsidiary that was not in
existence or not a Guarantor on the date of the Credit Agreement is required to enter into this
Agreement as a Guarantor upon becoming a Subsidiary, and each Guarantor wishes to comply with the
requirements of the Credit Agreement;



NOW, THEREFORE, in order to induce Lenders to make additional Loans and as consideration for
Loans previously made and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:



Section 1. Guarantee. Each Guarantor unconditionally guarantees, jointly with the
other Guarantors and severally, as a primary obligor and not merely as a surety, (i) the due and
punctual payment of all Obligations including, without limitation, (A) the principal of and
premium, if any, and interest (including interest accruing during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in
such proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or
more dates set for prepayment or otherwise and (B) all other monetary obligations, including fees,
costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise
(including monetary obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or allowable in such
proceeding), of the Loan Parties to the Administrative Agent and the Lenders under the Credit
Agreement and the other Loan Documents, (ii) the due and punctual performance of all covenants,
agreements, obligations and liabilities of the Loan Parties under or pursuant to the Credit
Agreement and the other Loan Documents; (iii) the due and punctual payment and performance of all
obligations of the Borrower, monetary or otherwise, arising under any Hedging Transaction incurred
to limit interest rate or fee fluctuation with respect to the Loans entered into with a
counterparty that was a Lender or an Affiliate of a Lender at the time such Hedging Transaction was
entered into (each such person a “Specified Hedge Provider”; and


 


B-1









 





(iv) the due and punctual payment and performance of all Bank Product Obligations; the
Administrative Agent, the Lenders, the Specified Hedge Providers and Bank Product Providers,
collectively, the “Secured Parties” and each individually a “Secured Party”) (all
the monetary and other obligations referred to in the preceding clauses (i) through (iv) being
collectively called the “Guaranteed Obligations”). Each Guarantor further agrees that the
Guaranteed Obligations may be extended or renewed, in whole or in part, without notice to or
further assent from such Guarantor, and that such Guarantor will remain bound upon its guarantee
notwithstanding any extension or renewal of any Guaranteed Obligations.



Section 2. Obligations Not Waived. To the fullest extent permitted by applicable
law, each Guarantor waives presentment or protest to, demand of or payment from the other Loan
Parties of any of the Guaranteed Obligations, and also waives notice of acceptance of its guarantee
and notice of protest for nonpayment. To the fullest extent permitted by applicable law, the
obligations of each Guarantor hereunder shall not be affected by (i) the failure of the
Administrative Agent or any Lender to assert any claim or demand or to enforce or exercise any
right or remedy against the Borrower or any other Guarantor under the provisions of the Credit
Agreement, any other Loan Document or otherwise, (ii) the failure of any Secured Party to assert
any claim or demand or to enforce or exercise any right or remedy against the Borrower or any other
Guarantor under the provisions or any instruments, agreements or documents executed in connection
with any Hedging Transaction incurred to limit interest rate or fee fluctuation with respect to the
Loans entered into with a Specified Hedge Provider (each such document, a “Hedging
Document”), (iii) any rescission, waiver, amendment or modification of, or any release from any
of the terms or provisions of, this Agreement, any other Loan Document, any Hedging Document, any
guarantee or any other agreement, including with respect to any other Guarantor under this
Agreement, or (iv) the failure to perfect any security interest in, or the release of, any of the
security held by or on behalf of the Administrative Agent or any Secured Party.



Section 3. Guarantee of Payment. Each Guarantor further agrees that its guarantee
constitutes a guarantee of payment when due and not of collection, and waives any right to require
that any resort be had by the Administrative Agent or any Secured Party to any of the security held
for payment of the Guaranteed Obligations or to any balance of any deposit account or credit on the
books of the Administrative Agent or any Secured Party in favor of the Borrower or any other
Person.



Section 4. No Discharge or Diminishment of Guarantee. The obligations of each
Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination
for any reason (other than the indefeasible payment in full in cash of the Guaranteed Obligations),
including any claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense or setoff, counterclaim, recoupment
or termination whatsoever by reason of the invalidity, illegality or unenforceability of the
Guaranteed Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor hereunder shall not be discharged or impaired or otherwise affected
by the failure of the Administrative Agent or any Secured Party to assert any claim or demand or to
enforce any remedy under the Credit Agreement, any other Loan Document, any Hedging Document or any
other agreement, by any waiver or modification of any provision of any thereof, by any default,
failure or delay, willful or otherwise, in the performance of the Guaranteed Obligations, or by any
other act or omission that may or might in any manner or to the extent vary the risk of any
Guarantor or that would otherwise operate as a discharge of each Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of all the Obligations).


 


B-2









 





Section 5. Defenses of Borrower Waived. To the fullest extent permitted by
applicable law, each Guarantor waives any defense based on or arising out of any defense of any
Loan Party or the unenforceability of the Guaranteed Obligations or any part thereof from any
cause, or the cessation from any cause of the liability of any Loan Party, other than the final and
indefeasible payment in full in cash of the Guaranteed Obligations. The Administrative Agent and
the Secured Parties may, at their election, foreclose on any security held by one or more of them
by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of
foreclosure, compromise or adjust any part of the Guaranteed Obligations, make any other
accommodation with any other Loan Party or any other guarantor, without affecting or impairing in
any way the liability of any Guarantor hereunder except to the extent the Guaranteed Obligations
have been fully, finally and indefeasibly paid in cash. Pursuant to applicable law, each Guarantor
waives any defense arising out of any such election even though such election operates, pursuant to
applicable law, to impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of such Guarantor against the Borrower or any other Guarantor or guarantor, as the case
may be, or any security.



Section 6. Agreement to Pay; Subordination. In furtherance of the foregoing and not
in limitation of any other right that the Administrative Agent or any Secured Party has at law or
in equity against any Guarantor by virtue hereof, upon the failure of the Borrower or any other
Loan Party to pay any Obligation when and as the same shall become due, whether at maturity, by
acceleration, after notice of prepayment or otherwise, each Guarantor hereby promises to and will
forthwith pay, or cause to be paid, to the Administrative Agent for the benefit of the Secured
Parties in cash the amount of such unpaid Obligation. Upon payment by any Guarantor of any sums to
the Administrative Agent, all rights of such Guarantor against any Loan Party arising as a result
thereof by way of right of subrogation, contribution, reimbursement, indemnity or otherwise shall
in all respects be subordinate and junior in right of payment to the prior indefeasible payment in
full in cash of all the Guaranteed Obligations. In addition, any indebtedness of any Loan Party
now or hereafter held by any Guarantor is hereby subordinated in right of payment to the prior
payment in full in cash of the Guaranteed Obligations. If any amount shall erroneously be paid to
any Guarantor on account of (i) such subrogation, contribution, reimbursement, indemnity or similar
right or (ii) any such indebtedness of any Loan Party, such amount shall be held in trust for the
benefit of the Administrative Agent and the Secured Parties and shall forthwith be paid to the
Administrative Agent to be credited against the payment of the Guaranteed Obligations, whether
matured or unmatured, in accordance with the terms of the Loan Documents.



Section 7. Information. Each Guarantor assumes all responsibility for being and
keeping itself informed of other Loan Parties’ financial condition and assets, and of all other
circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations and the nature,
scope and extent of the risks that such Guarantor assumes and incurs hereunder, and agrees that
none of the Administrative Agent or the Secured Parties will have any duty to advise any of the
Guarantors of information known to it or any of them regarding such circumstances or risks.



Section 8. Indemnity and Subrogation. In addition to all such rights of indemnity
and subrogation as the Guarantors may have under applicable law (but subject to Section 6),
the Borrower agrees that (a) in the event a payment shall be made by any Guarantor under this
Agreement, the Borrower shall indemnify such Guarantor for the full amount of such payment and such
Guarantor shall be subrogated to the rights of the person to whom such payment shall have been made
to the extent of such payment and (b) in the event any assets of any Guarantor shall be sold to
satisfy a claim of any Secured Party under this Agreement, the Borrower shall



 


B-3









 






indemnify such Guarantor in an amount equal to the greater of the book value or the fair
market value of the assets so sold.



Section 9. Contribution and Subrogation. Each Guarantor (a “Contributing
Guarantor”) agrees (subject to Section 6) that, in the event a payment shall be made by
any other Guarantor under this Agreement or assets of any other Guarantor shall be sold to satisfy
a claim of any Secured Party and such other Guarantor (the “Claiming Guarantor”) shall not
have been fully indemnified by the Borrower as provided in Section 8, the Contributing
Guarantor shall indemnify the Claiming Guarantor in an amount equal to the amount of such payment
or the greater of the book value or the fair market value of such assets, as the case may be, in
each case multiplied by a fraction of which the numerator shall be the net worth of the
Contributing Guarantor on the date hereof and the denominator shall be the aggregate net worth of
all the Guarantors on the date hereof (or, in the case of any Guarantor becoming a party hereto
pursuant to Section 21, the date of the Supplement hereto executed and delivered by such
Guarantor). Any Contributing Guarantor making any payment to a Claiming Guarantor pursuant to this
Section 9 shall be subrogated to the rights of such Claiming Guarantor under Section
8 to the extent of such payment.



Section 10. Subordination. Notwithstanding any provision of this Agreement to the
contrary, all rights of the Guarantors under Section 8 and Section 9 and all other
rights of indemnity, contribution or subrogation under applicable law or otherwise shall be fully
subordinated to the indefeasible payment in full in cash of the Guaranteed Obligations. No failure
on the part of the Borrower or any Guarantor to make the payments required under applicable law or
otherwise shall in any respect limit the obligations and liabilities of any Guarantor with respect
to its obligations hereunder, and each Guarantor shall remain liable for the full amount of the
obligations of such Guarantor hereunder.



Section 11. Representations and Warranties. Each Guarantor represents and warrants
as to itself that all representations and warranties relating to it (as a Subsidiary of the
Borrower) contained in the Credit Agreement are true and correct.



Section 12. Termination. The guarantees made hereunder (i) shall terminate when all
the Guaranteed Obligations (other than those Guaranteed Obligations relating to the Hedging
Obligations) have been paid in full in cash and the Lenders have no further commitment to lend
under the Credit Agreement and (ii) shall continue to be effective or be reinstated, as the case
may be, if at any time payment, or any part thereof, of any Obligation is rescinded or must
otherwise be restored by any Lender or any Guarantor upon the bankruptcy or reorganization of the
Borrower, any Guarantor or otherwise. In connection with the foregoing, the Administrative Agent
shall execute and deliver to such Guarantor or Guarantor’s designee, at such Guarantor’s expense,
any documents or instruments, without representation or recourse, which such Guarantor shall
reasonably request from time to time to evidence such termination and release.



Section 13. Binding Effect; Several Agreement; Assignments. Whenever in this
Agreement any of the parties hereto is referred to, such reference shall be deemed to include the
successors and assigns of such party; and all covenants, promises and agreements by or on behalf of
the Guarantors that are contained in this Agreement shall bind and inure to the benefit of each
party hereto and their respective successors and assigns. This Agreement shall become effective as
to any Guarantor when a counterpart hereof executed on behalf of such Guarantor shall have been
delivered to the Administrative Agent, and a counterpart hereof shall have been executed on behalf
of the Administrative Agent, and thereafter shall be binding upon such Guarantor and the
Administrative Agent and their respective successors and assigns, and shall inure to the benefit of



 


B-4









 






such Guarantor, the Administrative Agent and the Secured Parties, and their respective
successors and assigns, except that no Guarantor shall have the right to assign its rights or
obligations hereunder or any interest herein (and any such attempted assignment shall be void). If
all of the capital stock of a Guarantor is sold, transferred or otherwise disposed of pursuant to a
transaction permitted by the Credit Agreement, such Guarantor shall be released from its
obligations under this Agreement without further action. This Agreement shall be construed as a
separate agreement with respect to each Guarantor and may be amended, modified, supplemented,
waived or released with respect to any Guarantor without the approval of any other Guarantor and
without affecting the obligations of any other Guarantor hereunder.




Section 14. Waivers; Amendment.



(a) No failure or delay of the Administrative Agent of any kind in exercising any power, right
or remedy hereunder and no course of dealing between any Guarantor on the one hand the and
Administrative Agent or any holder of any Note on the other hand shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power, right or remedy hereunder, under any
other Loan Document or under any Hedging Document, or any abandonment or discontinuance of steps to
enforce such a power, right or remedy, preclude any other or further exercise thereof or the
exercise of any other power, right or remedy. The rights and of the Administrative Agent hereunder
and of the Secured Parties under the other Loan Documents and the Hedging Documents, as applicable,
are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No
waiver of any provision of this Agreement or consent to any departure by any Guarantor therefrom
shall in any event be effective unless the same shall be permitted by subsection (b) below, and
then such waiver and consent shall be effective only in the specific instance and for the purpose
for which given. No notice or demand on any Guarantor in any case shall entitle such Guarantor to
any other or further notice in similar or other circumstances.



(b) Neither this Agreement nor any provision hereof may be waived, amended or modified except
pursuant to a written agreement entered into between the Guarantors with respect to which such
waiver, amendment or modification relates and the Administrative Agent, with the prior written
consent of the Required Lenders (except as otherwise provided in the Credit Agreement).



Section 15. Notices. All communications and notices hereunder shall be in writing
and given as provided in Section 10.1 of the Credit Agreement. All communications and notices
hereunder to each Guarantor shall be given to it at its address set forth on Schedule I
attached hereto.



Section 16. Severability. Any provision of this Agreement held to be illegal,
invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be ineffective to the
extent of such illegality, invalidity or unenforceability without affecting the legality, validity
or enforceability of the remaining provisions hereof or thereof; and the illegality, invalidity or
unenforceability of a particular provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.



Section 17. Counterparts; Integration. This Agreement may be executed in
counterparts, each of which shall constitute an original, but all of which when taken together
shall constitute a single contract (subject to Section 13), and shall become effective as
provided in Section 13. Delivery of an executed signature page to this Agreement by
facsimile transmission shall be as effective as delivery of a manually executed counterpart of this
Agreement. This



 


B-5









 






Agreement constitutes the entire agreement among the parties hereto regarding the subject
matters hereof and supersedes all prior agreements and understandings, oral or written, regarding
such subject matter.



Section 18. Rules of Interpretation. The rules of interpretation specified in
Section 1.4 of the Credit Agreement shall be applicable to this Agreement.




Section 19. Governing Law; Jurisdiction; Consent to Service of Process.



(a) This Agreement shall be construed in accordance with and be governed by the law (without
giving effect to the conflict of law principles thereof) of the State of [State].



(b) Each Guarantor hereby irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of the United States courts located within the Southern
district in the State of New York, and any state court of the State of New York located in New
York, New York and any appellate court from any thereof, in any action or proceeding arising out of
or relating to this Agreement, any other Loan Document or any Hedging Document or the transactions
contemplated hereby or thereby, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such New York state court or, to the extent
permitted by applicable law, such Federal court. Each Guarantor agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that the Administrative Agent or any Secured Party may otherwise have to bring any
action or proceeding relating to this Agreement against any Guarantor or its properties in the
courts of any jurisdiction.



(c) Each Guarantor irrevocably and unconditionally waives any objection which it may now or
hereafter have to the laying of venue of any such suit, action or proceeding described in paragraph
(b) of this Section and brought in any court referred to in paragraph (b) of this Section. Each
party hereto irrevocably waives, to the fullest extent permitted by applicable law, the defense of
an inconvenient forum to the maintenance of such action or proceeding in any such court.



(d) Each Guarantor irrevocably consents to the service of process in the manner provided for
notices in Section 10.1 of the Credit Agreement. Nothing in this Agreement will affect the right
of the Administrative Agent or any Secured Party to serve process in any other manner permitted by
law.



Section 20. Waiver of Jury Trial. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR ANY
HEDGING DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY). EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (ii) ACKNOWLEDGES THAT
IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS AND



 


B-6









 






THE HEDGING DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.



Section 21. Additional Guarantors. Pursuant to Section 5.11 of the Credit Agreement,
each Subsidiary that was not in existence on the date of the Credit Agreement is required to enter
into this Agreement as a Guarantor upon becoming a Subsidiary. Upon execution and delivery after
the date hereof by the Administrative Agent and such Subsidiary of an instrument in the form of
Annex 1, such Subsidiary shall become a Guarantor hereunder with the same force and effect
as if originally named as a Guarantor herein. The execution and delivery of any instrument adding
an additional Guarantor as a party to this Agreement shall not require the consent of any other
Guarantor hereunder. The rights and obligations of each Guarantor hereunder shall remain in full
force and effect notwithstanding the addition of any new Guarantor as a party to this Agreement.



Section 22. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Secured Party is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other Indebtedness at any time owing by
such Secured Party to or for the credit or the account of any Guarantor against any or all the
obligations of such Guarantor now or hereafter existing under this Agreement, the other Loan
Documents and the Hedging Documents held by such Secured Party, irrespective of whether or not such
Person shall have made any demand under this Agreement, any other Loan Document or any Hedging
Document and although such obligations may be unmatured. The rights of each Secured Party under
this Section 22 are in addition to other rights and remedies (including other rights of
setoff) that such Secured Party may have.




Section 23. Savings Clause.



(a) It is the intent of each Guarantor and the Administrative Agent that each Guarantor’s
maximum obligations hereunder shall be, but not in excess of:




(i) in a case or proceeding commenced by or against any Guarantor under the provisions
of Title 11 of the United States Code, 11 U.S.C. §§ 101 et seq. (the “Bankruptcy
Code”) on or within two years from the date on which any of the Guaranteed Obligations
are incurred, the maximum amount which would not otherwise cause the Guaranteed Obligations
(or any other obligations of such Guarantor owed to the Administrative Agent or the Secured
Parties) to be avoidable or unenforceable against such Guarantor under (i) Section 548 of
the Bankruptcy Code or (ii) any state fraudulent transfer or fraudulent conveyance act or
statute applied in such case or proceeding by virtue of Section 544 of the Bankruptcy Code;
or




(ii) in a case or proceeding commenced by or against any Guarantor under the
Bankruptcy Code subsequent to two years from the date on which any of the Guaranteed
Obligations are incurred, the maximum amount which would not otherwise cause the Guaranteed
Obligations (or any other obligations of such Guarantor to the Administrative Agent or the
Secured Parties) to be avoidable or unenforceable against such Guarantor under any state
fraudulent transfer or fraudulent conveyance act or statute applied in any such case or
proceeding by virtue of Section 544 of the Bankruptcy Code; or


 


B-7









 






(iii) in a case or proceeding commenced by or against any Guarantor under any law,
statute or regulation other than the Bankruptcy Code (including, without limitation, any
other bankruptcy, reorganization, arrangement, moratorium, readjustment of debt,
dissolution, liquidation or similar debtor relief laws), the maximum amount which would not
otherwise cause the Guaranteed Obligations (or any other obligations of such Guarantor to
the Administrative Agent or the Secured Parties) to be avoidable or unenforceable against
such Guarantor under such law, statute or regulation including, without limitation, any
state fraudulent transfer or fraudulent conveyance act or statute applied in any such case
or proceeding.



(b) The substantive laws under which the possible avoidance or unenforceability of the
Guaranteed Obligations (or any other obligations of such Guarantor to the Administrative Agent or
the Secured Parties) as may be determined in any case or proceeding shall hereinafter be referred
to as the “Avoidance Provisions”. To the extent set forth in Section 23(a)(i),
(ii), and (iii), but only to the extent that the Guaranteed Obligations would
otherwise be subject to avoidance or found unenforceable under the Avoidance Provisions, if any
Guarantor is not deemed to have received valuable consideration, fair value or reasonably
equivalent value for the Guaranteed Obligations, or if the Guaranteed Obligations would render such
Guarantor insolvent, or leave such Guarantor with an unreasonably small capital to conduct its
business, or cause such Guarantor to have incurred debts (or to have intended to have incurred
debts) beyond its ability to pay such debts as they mature, in each case as of the time any of the
Guaranteed Obligations are deemed to have been incurred under the Avoidance Provisions and after
giving effect to the contribution by such Guarantor, the maximum Guaranteed Obligations for which
such Guarantor shall be liable hereunder shall be reduced to that amount which, after giving effect
thereto, would not cause the Guaranteed Obligations (or any other obligations of such Guarantor to
the Administrative Agent or the Secured Parties), as so reduced, to be subject to avoidance or
unenforceability under the Avoidance Provisions.



(c) This Section 23 is intended solely to preserve the rights of the Administrative
Agent and the Secured Parties hereunder to the maximum extent that would not cause the Guaranteed
Obligations of such Guarantor to be subject to avoidance or unenforceability under the Avoidance
Provisions, and neither the Guarantors nor any other Person shall have any right or claim under
this Section 23 as against the Administrative Agent or Secured Parties that would not
otherwise be available to such Person under the Avoidance Provisions.



[Signatures Follow]



 


B-8









 





IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first above written.



	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 






[SIGNATURE PAGE TO AMENDED AND RESTATED SUBSIDIARY GUARANTY

AGREEMENT]






 


 









 







	 	 	 	 	 
	SUNTRUST BANK, as	 	 
	Administrative Agent	 	 
	 
	 	 	 	 
	By
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 






[SIGNATURE PAGE TO AMENDED AND RESTATED SUBSIDIARY GUARANTY

AGREEMENT]





 


 









 







SCHEDULE I TO THE

SUBSIDIARY GUARANTY AGREEMENT




	 	 	 	 	 
	Guarantor(s)	 	 	Address	 






 


B-12









 







ANNEX 1

to

SUBSIDIARY GUARANTY AGREEMENT




SUPPLEMENT NO. 
_____ dated as of _____, to the Subsidiary Guaranty Agreement, dated as
of _____ (the “Guaranty Agreement”), among each of the subsidiaries of the Borrower
listed on Schedule I thereto (each such subsidiary individually, a “Guarantor” and
collectively, the “Guarantors”) and SUNTRUST BANK, a Georgia banking corporation, as
administrative agent (the “Administrative Agent”) for the Lenders (as defined in the Credit
Agreement referred to below).




Reference is made to the Amended and Restated Senior Secured Revolving Credit Agreement,
dated as of March 30, 2010 (as amended, restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among Kayne Anderson Energy Development Company, a Maryland
corporation (the “Borrower”), the lenders from time to time party thereto (the
“Lenders”) and SunTrust Bank, as Administrative Agent and Swingline Lender.



Capitalized terms used herein and not otherwise defined herein shall have the meanings
assigned to such terms in the Guaranty Agreement and the Credit Agreement.



The Guarantors have entered into the Guaranty Agreement in order to induce the Lenders to make
Loans. Pursuant to Section 5.10 of the Credit Agreement, each Subsidiary that was not in existence
or not a Guarantor on the date of the Credit Agreement is required to enter into the Guaranty
Agreement as a Guarantor upon becoming a Subsidiary. Section 21 of the Guaranty Agreement provides
that additional Subsidiaries of the Borrower may become Guarantors under the Guaranty Agreement by
execution and delivery of an instrument in the form of this Supplement. The undersigned Subsidiary
of the Borrower (the “New Guarantor”) is executing this Supplement in accordance with the
requirements of the Credit Agreement to become a Guarantor under the Guaranty Agreement in order to
induce the Lenders to make additional Loans and as consideration for Loans previously made.




Accordingly, the Administrative Agent and the New Guarantor agree as follows:



Joinder. In accordance with Section 21 of the Guaranty Agreement, the New Guarantor by its
signature below becomes a Guarantor under the Guaranty Agreement with the same force and effect as
if originally named therein as a Guarantor and the New Guarantor hereby (i) agrees to all the terms
and provisions of the Guaranty Agreement applicable to it as Guarantor thereunder and (ii)
represents and warrants that the representations and warranties made by it as a Guarantor
thereunder are true and correct on and as of the date hereof. Each reference to a Guarantor in the
Guaranty Agreement shall be deemed to include the New Guarantor. The Guaranty Agreement is hereby
incorporated herein by reference.



Representations and Warranties. The New Guarantor represents and warrants to the
Administrative Agent and the Secured Parties that this Supplement has been duly authorized,
executed and delivered by it and that each of this Supplement and the Guaranty Agreement
constitutes its legal, valid and binding obligation, enforceable against it in accordance with its
terms.



Binding Effect. This Supplement shall become effective when it shall have been executed by
the New Guarantor and thereafter shall be binding upon the New Guarantor and shall inure to the
benefit of the Administrative Agent and the Secured Parties. Upon the effectiveness of this



 


B-13









 






Supplement, this Supplement shall be deemed to be a part of and shall be subject to all the
terms and conditions of the Guaranty Agreement. The New Guarantor shall not have the right to
assign its rights hereunder or any interest herein without the prior written consent of the Secured
Parties.



Governing Law. THIS SUPPLEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF
LAW PRINCIPLES THEREOF) OF THE STATE OF NEW YORK.



Execution in Counterparts. This Supplement may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.



Notices to New Guarantor. All communications and notices hereunder shall be in writing and
given as provided in Section 15 of the Guaranty Agreement. All communications and notices
hereunder to the New Guarantor shall be given to it at the address set forth under its signature
below, with a copy to the Borrower..



[Signatures Follow]





 


B-14









 







IN WITNESS WHEREOF, the New Guarantor and the Administrative Agent have duly executed this
Supplement to the Guaranty Agreement as of the day and year first above written.



	 	 	 	 	 	 	 
	 	 	[NAME OF NEW GUARANTOR]	 	 
	 
	 	 	 	 	 	 
	 
	 	By	 	 	 	 
	 

	 	 
	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	Address:	 	 
	 
	 	 	 	 	 	 
	 	 	SUNTRUST BANK, as	 	 
	 	 	Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 
	 	By	 	 	 	 
	 

	 	 
	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 







 


 









 







EXHIBIT 2.3

FORM OF NOTICE OF REVOLVING BORROWING




[__________], 20__




SunTrust Bank,
  
as Administrative Agent
  
for the Lenders referred to below

303 Peachtree Street, N.E.

Atlanta, GA 30308



Ladies and Gentlemen:



Reference is made to the Amended and Restated Senior Secured Revolving Credit Agreement dated
as of March 30, 2010 (as amended and in effect on the date hereof, the “Credit Agreement”),
among the undersigned, as Borrower, the lenders from time to time party thereto, and SunTrust Bank,
as Administrative Agent. Terms defined in the Credit Agreement are used herein with the same
meanings. This notice constitutes a Notice of Revolving Borrowing, and the Borrower hereby
requests a Revolving Borrowing under the Credit Agreement, and in that connection the Borrower
specifies the following information with respect to the Revolving Borrowing requested hereby:




	 	(A)	 	Aggregate principal amount of Revolving Borrowing1:                     

	 
	 	(B)	 	Date of Revolving Borrowing (which is a Business Day)2:                     

	 
	 	(C)	 	Interest Rate basis3:                     

	 
	 	(D)	 	Interest Period4:                     

	 
	 	(E)	 	Location and number of Borrower’s account to which proceeds of Revolving
Borrowing are to be disbursed:                     





 





	 	 	 
	1	 	Not less than $1,000,000 and an integral multiple of
$250,000 for Eurodollar borrowing and not less than $250,000 and an integer
multiple of $100,000 for Base Rate Borrowing.

	 
	2	 	With respect to Base Rate Borrowings, notice must be
given prior to 11:00 a.m. (New York time) on the day of borrowing, and with
respect to Eurodollar Borrowings, notice must be given prior to 2:00 p.m. (New
York time) no later than three (3) business days prior to the date of
borrowing.

	 
	3	 	Eurodollar Borrowing or Base Rate Borrowing.

	 
	4	 	Which must comply with the definition of “Interest
Period” and end not later than the Revolving Commitment Termination Date.





Exhibit 2.3-1





 


 









 










The Borrower hereby represents and warrants that the conditions specified in paragraphs (a),
(b) and (c) of Section 3.2 of the Credit Agreement are satisfied.



	 	 	 	 	 
	 	Very truly yours,



KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



[SIGNATURE PAGE TO NOTICE OF REVOLVING BORROWING]




 


 









 







EXHIBIT 2.4




FORM OF NOTICE OF SWINGLINE BORROWING




[_______], 20__





SunTrust Bank,
  
as Administrative Agent
  
for the Lenders referred to below

303 Peachtree Street, N.E.

Atlanta, GA 30308



Ladies and Gentlemen:



Reference is made to the Amended and Restated Senior Secured Revolving Credit Agreement dated
as of March 30, 2010 (as amended and in effect on the date hereof, the “Credit
Agreement”), among the undersigned, as Borrower, the Lenders named therein, and SunTrust Bank,
as Administrative Agent. Terms defined in the Credit Agreement are used herein with the same
meanings. This notice constitutes a Notice of Swingline Borrowing, and the Borrower hereby
requests a Swingline Borrowing under the Credit Agreement, and in that connection the Borrower
specifies the following information with respect to the Swingline Borrowing requested hereby:




	 	(A)	 	Principal amount of Swingline Loan1:                     







	 	(B)	 	Date of Swingline Loan (which is a Business Day)2                     

	 
	 	(C)	 	Location and number of Borrower’s account to which proceeds of Swingline Loan
are to be disbursed:                     





 





	 	 	 
	1	 	Not less than $100,000 and an integral multiple of
$50,000.

	 
	2	 	Notice must be given prior to 10:00 a.m. (New York
time) on the day of borrowing





Exhibit 2.4-1





 


 









 










The Borrower hereby represents and warrants that the conditions specified in paragraphs (a),
(b) and (c) of Section 3.2 of the Credit Agreement are satisfied.



	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 






[SIGNATURE PAGE TO NOTICE OF SWINGLINE BORROWING]





 


 









 







EXHIBIT 2.6(b)

FORM OF CONTINUATION/CONVERSION




[_________], 20__




SunTrust Bank,
  
as Administrative Agent
  
for the Lenders referred to below

303 Peachtree Street, N.E.

Atlanta, GA 30308



Ladies and Gentlemen:



Reference is made to the Amended and Restated Senior Secured Revolving Credit Agreement dated
as of March 30, 2010 (as amended and in effect on the date hereof, the “Credit Agreement”),
among the undersigned, as Borrower, the lenders named therein, and SunTrust Bank, as Administrative
Agent. Terms defined in the Credit Agreement are used herein with the same meanings. This notice
constitutes a Notice of Continuation/Conversion and the Borrower hereby requests the conversion or
continuation of a Revolving Borrowing under the Credit Agreement, and in that connection the
Borrower specifies the following information with respect to the Revolving Borrowing to be
converted or continued as requested hereby:




	 	(A)	 	Revolving Borrowing to which this request applies:                     

	 
	 	(B)	 	Principal amount of Revolving Borrowing to be converted/continued:                     

	 
	 	(C)	 	Effective date of election (which is a Business Day):                     

	 
	 	(D)	 	Interest rate basis:                     

	 
	 	(E)	 	Interest Period:                     






Exhibit 2.6(b)-1









 


 









 










	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 






[SIGNATURE PAGE TO CONTINUATION/CONVERSION]





 


 









 







EXHIBIT 3.1(c)(v)

FORM OF SECRETARY’S CERTIFICATE OF KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY




Reference is made to the Amended and Restated Senior Secured Revolving Credit Agreement dated
as of March 30, 2010 (the “Credit Agreement”), among KAYNE ANDERSON ENERGY DEVELOPMENT
COMPANY (the “Borrower”), the lenders named therein, and SunTrust Bank, as Administrative
Agent. Terms defined in the Credit Agreement are used herein with the same meanings. This
certificate is being delivered pursuant to Section 3.1(c)(v) of the Credit Agreement.




I,
[                       ],
Secretary of the Borrower, DO HEREBY CERTIFY that:



(a) there have been no amendments or supplements to, or restatements of, the articles of
incorporation of the Borrower delivered pursuant to Section 3.1(c)(v) of the Credit Agreement;



(b) no proceedings have been instituted or are pending or contemplated with respect to the
dissolution, liquidation or sale of all or substantially all the assets of the Borrower or
threatening its existence or the forfeiture or any of its corporate rights;



(c) annexed hereto as Exhibit A is a true and correct copy of the Bylaws of the Borrower as in
effect on [Date]1 and at all times thereafter through the date hereof;



(d) annexed hereto as Exhibit B is a true and correct copy of certain resolutions duly adopted
by the Board of Directors of the Borrower at a meeting of said Board of Directors duly called and
held on [date], which resolutions are the only resolutions adopted by the Board of Directors of the
Borrower or any committee thereof relating to the Credit Agreement and the other Loan Documents to
which the Borrower is a party and the transactions contemplated therein and have not been revoked,
amended, supplemented or modified and are in full force and effect on the date hereof; and


 





	 	 	 
	1	 	This date should be prior to the date of the
resolutions referred to in clause (d).





Exhibit 3.1(c)(v)-1





 


 









 










(e) each of the persons named below is and has been at all times since [_____] a duly

elected and qualified officer of the Borrower holding the respective office set forth opposite his
or her name and the signature set forth opposite of each such person is his or her genuine
signature:



	 	 	 	 	 
	Name	 	Title	 	Specimen Signature
	 
	 	 	 	 
	 

	 	 
	 	 
	 
	 	 	 	 
	 

	 	 
	 	 
	 
	 	 	 	 
	 

	 	 
	 	 
	 
	 	 	 	 
	 

	 	 
	 	 
	 
	 	 	 	 
	 

	 	 
	 	 







IN WITNESS WHEREOF, I have hereunto signed my name as of the date first above written.



	 	 	 	 	 
	 

	 	 

Name
	 	 
	 

	 	Secretary	 	 






I,
_____, [_____] of the Borrower, do hereby certify that
_____ has been duly elected, is duly qualified and is the [Assistant] Secretary
of the Borrower, that the signature set forth above is [his/her] genuine signature and that
[he/she] has held such office at all times since [
_____].1



	 	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 





 





	 	 	 
	1	 	This certification should be included as part of the
Secretary’s certificate and signed by one of the officers whose incumbency is
certified pursuant to clause (e) above.





Exhibit 3.1(c)(v)-2





 


 









 










EXHIBIT A




[Bylaws]




Exhibit 3.1(c)(v)-3





 


 









 







EXHIBIT B




[Resolutions]




Exhibit 3.1(c)(v)-4





 


 









 







EXHIBIT 3.1(c)(viii)

FORM OF RESPONSIBLE OFFICER’S CERTIFICATE




Reference is made to the Amended and Restated Senior Secured Revolving Credit Agreement dated
as of March 30, 2010 (the “Credit Agreement”), among KAYNE ANDERSON ENERGY DEVELOPMENT
COMPANY (the “Borrower”), the lenders from time to time party thereto, and SunTrust Bank,
as Administrative Agent. Terms defined in the Credit Agreement are used herein with the same
meanings. This certificate is being delivered pursuant to Section 3.1(c)(viii) of the Credit
Agreement.



I,
_____, [_____] of the Borrower, DO HEREBY CERTIFY
that:



(a) the representations and warranties of each Loan Party set forth in the Loan Documents are
true and correct on and as of the date hereof;




(b) no Default or Event of Default has occurred and is continuing at the date hereof;



(c) since [the date], which is the date of the most recent financial statements described in
Section 5.1(a) of the Credit Agreement, there has been no change which has had or could reasonably
be expected to have a Material Adverse Effect; and



(d) there are no consents, approvals, authorizations, registrations and filings or orders
required or advisable to be made or obtained under any Requirement of Law, or by any Contractual
Obligation of any Loan Party, in connection with the execution, delivery, performance, validity and
enforceability of the Loan Documents or any of the transactions contemplated thereby, and all
consents, approvals, authorizations, registrations, filings and orders are in full force and effect
and all applicable waiting periods have expired, and no investigation or inquiry by any
governmental authority regarding the Commitments or any transaction being financed with the
proceeds thereof is ongoing.



Exhibit 3.1(c)(viii)-1





 


 









 








IN WITNESS WHEREOF, I have hereunto signed my name as of the date first above written.



	 	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 






Exhibit 3.1(c)(viii)-2





 


 









 







EXHIBIT 5.1(c)

FORM OF COMPLIANCE CERTIFICATE




[___________], 20__





			
	To:	 	SunTrust Bank, as Administrative Agent

303 Peachtree St., N.E.

Atlanta, GA 30308

Attention: _____________






Ladies and Gentlemen:



Reference is made to that certain Amended and Restated Senior Secured Revolving Credit
Agreement dated as of March 30, 2010 (as amended and in effect on the date hereof, the “Credit
Agreement”), among KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY (the “Borrower”), the
lenders named therein, and SunTrust Bank, as Administrative Agent. Capitalized terms used herein
and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement.



I,
_____, being the duly elected and qualified, and acting in my capacity as
[chief executive officer][chief financial officer] of the Borrower, hereby certify to the
Administrative Agent and each Lender as follows:



1. The consolidated financial statements of the Borrower and its Subsidiaries attached hereto
for the fiscal [quarter][year] ending
_____ fairly present in all material respects
the financial condition of the Borrower and its Subsidiaries as at the end of such fiscal
[quarter][year] on a consolidated basis, and the related statements of operations and cash flows of
the Borrower and its Subsidiaries for such fiscal [quarter][year], in accordance with generally
accepted accounting principles in the United States consistently applied (subject, in the case of
such quarterly financial statements, to normal year-end audit adjustments and the absence of
footnotes).



2. The calculations set forth in Attachment 1 are computations of the financial
covenants set forth in Article VI of the Credit Agreement calculated or derived from the financial
statements referenced in clause 1 above in accordance with the terms of the Credit Agreement.



3. The Borrower and its Subsidiaries have complied with all the terms and provisions of
Section 3.02(a) of the Sarbanes-Oxley Act as in effect on the date hereof.



4. Based upon a review of the activities of the Borrower and its Subsidiaries and the
financial statements attached hereto during the period covered thereby, as of the date hereof,
there exists no Default or Event of Default.



Exhibit 5.1(c)-1






 


 









 







	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 






Exhibit 5.1(c)-2



 


 









 





Attachment to Compliance Certificate




Exhibit 5.1(c)-3






 


 









 







EXHIBIT 5.1(e)




FORM OF BORROWING BASE CERTIFICATE




KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY




Date: [______________]




This certificate is given by KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY, a Maryland corporation
(the “Borrower”) pursuant to subsection 5.1(e) of that certain Amended and Restated Senior
Secured Revolving Credit Agreement dated as of March 30, 2010 among Borrower, the other Loan
Parties party thereto, the Lenders from time to time party thereto, SunTrust Bank, as
Administrative Agent for the Lenders and [_____], as Syndication Agent (as such agreement
may have been amended, restated, supplemented or otherwise modified from time to time the
“Credit Agreement”). Capitalized terms used herein without definition shall have the
meanings set forth in the Credit Agreement.



The officer executing this certificate is the [_____] of the Borrower and as such
is duly authorized to execute and deliver this certificate on behalf of Borrower. By executing
this certificate such officer hereby certifies to Agent and Lenders that:




(a) Attached hereto as Schedule 1 is a calculation of the Borrowing Base for the
Borrower as of the above date;




(b) based on such schedule, the Borrowing Base as the above date is:



$__________________




[Signature page to follow]




Exhibit 5.1(e)-1





 


 









 







IN WITNESS WHEREOF, the undersigned has executed and delivered this Certificate as of the date
first set forth above.



	 	 	 	 	 
	 	KAYNE ANDERSON ENERGY

DEVELOPMENT COMPANY

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



[SIGNATURE PAGE TO BORROWING BASE CERTIFICATE]




 


 









 







BORROWING BASE CALCULATION


KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY




See Attached




Schedule 1, Page 1 to Borrowing Base Certificate




 


 









 







EXHIBIT 7.4




FORM OF DISTRIBUTABLE CASH FLOW CERTIFICATE




KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY




Date: [______________]





This certificate is given by KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY, a Maryland corporation
(the “Borrower”) pursuant to subsection 7.4(c) of that certain Amended and Restated Senior
Secured Revolving Credit Agreement dated as of March 30, 2010 among Borrower, the other Loan
Parties party thereto, the Lenders from time to time party thereto, SunTrust Bank, as
Administrative Agent for the Lenders and [_____], as Syndication Agent (as such agreement may
have been amended, restated, supplemented or otherwise modified from time to time the “Credit
Agreement”). Capitalized terms used herein without definition shall have the meanings set
forth in the Credit Agreement.



The officer executing this certificate is the [_____] of the Borrower and as such
is duly authorized to execute and deliver this certificate on behalf of Borrower. By executing
this certificate such officer hereby certifies to Agent and Lenders that:




(a) Attached hereto as Schedule 1 is a calculation of the Distributable Cash Flow for
the Borrower as of the above date;




(b) based on such schedule, the Distributable Cash Flow as the above date is:



$__________________




[Signature page to follow]




Exhibit 7.4-1




 


 









 







IN WITNESS WHEREOF, the undersigned has executed and delivered this Certificate as of the date
first set forth above.



	 	 	 	 	 
	 	KAYNE ANDERSON ENERGY

DEVELOPMENT COMPANY

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Schedule 1 to Borrowing Base Certificate