OR INTENDED USE OF THE
PROCEEDS OF ANY ADVANCE LOAN HEREUNDER, OR IN CONNECTION WITH ANY INVESTIGATION
OF ANY POTENTIAL MATTER COVERED HEREBY, BUT EXCLUDING ANY CLAIM OR LIABILITY
THAT ARISES AS THE RESULT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY
INDEMNITEE, AS FINALLY JUDICIALLY DETERMINED BY A COURT OF COMPETENT
JURISDICTION (COLLECTIVELY, "INDEMNIFIED MATTERS").
IN ADDITION, BORROWER SHALL
PERIODICALLY, UPON REQUEST, REIMBURSE EACH INDEMNITEE FOR ITS REASONABLE LEGAL
AND OTHER ACTUAL EXPENSES (INCLUDING THE REASONABLE COST OF ANY INVESTIGATION
AND PREPARATION) INCURRED IN CONNECTION WITH ANY INDEMNIFIED MATTER.
THE
REIMBURSEMENT, INDEMNITY AND CONTRIBUTION OBLIGATIONS UNDER THIS SECTION SHALL
BE IN ADDITION TO ANY LIABILITY WHICH BORROWER MAY OTHERWISE HAVE, SHALL EXTEND
UPON THE SAME TERMS AND CONDITIONS TO EACH INDEMNITEE, AND SHALL BE BINDING UPON
AND INURE TO THE BENEFIT OF ANY SUCCESSORS, ASSIGNS, HEIRS AND PERSONAL
REPRESENTATIVES OF BORROWER, LENDER AND ALL OTHER INDEMNITEES.
THIS
SECTION SHALL SURVIVE ANY TERMINATION OF THIS AGREEMENT AND PAYMENT OF THE
OBLIGATIONS.
ARTICLE VI
NEGATIVE COVENANTS
From the date hereof and so long as this Agreement is in effect and until
payment in full of the Obligations, the termination of the Advance Commitment,
and the performance of all other obligations of each Obligor under this
Agreement and each other Loan Document:
6.1
TOTAL ADJUSTED CAPITAL.
BORROWER SHALL NOT
PERMIT TOTAL ADJUSTED CAPITAL OF GAICA TO BE LESS THAN THE GREATER OF
(A) $40,000,000 AND (B) THE AMOUNT REQUIRED FOR RISK-BASED
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CAPITAL RATIO OF GAICA TO EQUAL (I) PRIOR TO THE RESET DATE, 275%, OR (II) FROM
AND AFTER THE RESET DATE, 250%, AS AT THE LAST DAY OF ANY FISCAL QUARTER OF
GAICA.
6.2
COMBINED RATIO.
BORROWER SHALL NOT PERMIT
THE COMBINED RATIO TO BE GREATER THAN 100% AS AT THE LAST DAY OF ANY FISCAL
QUARTER OF BORROWER.
6.3
FIXED CHARGES COVERAGE RATIO.
BORROWER
SHALL NOT PERMIT THE FIXED CHARGES COVERAGE RATIO TO BE LESS THAN 1.25 TO 1.00
AT ANY TIME.
6.4
CONSOLIDATED NET WORTH.
BORROWER SHALL NOT
PERMIT CONSOLIDATED NET WORTH TO BE LESS THAN $30,000,000 AT ANY TIME.
6.5
DIVIDENDS.
BORROWER SHALL NOT DECLARE, PAY
OR OTHERWISE BE LIABLE FOR THE PAYMENT OF ANY DIVIDEND, OTHER THAN ACCRUED
DIVIDENDS DESCRIBED IN SECTION 3 OF THE PREFERRED STOCK DOCUMENTS (AS SUCH
DOCUMENTS EXIST ON THE AGREEMENT DATE); PROVIDED, (A) SUCH DIVIDENDS ARE
DECLARED AND PAID IN ACCORDANCE WITH THE PREFERRED STOCK DOCUMENTS (AS SUCH
DOCUMENTS EXIST ON THE AGREEMENT DATE), AND (B) BOTH PRIOR TO AND AFTER GIVING
EFFECT THERETO, NO DEFAULT OR EVENT OF DEFAULT SHALL EXIST.
6.6
LIMITATION ON DEBT.
BORROWER SHALL NOT, AND
SHALL NOT PERMIT ANY SUBSIDIARY TO, CREATE, INCUR, ASSUME, BECOME OR BE LIABLE
IN ANY MANNER IN RESPECT OF, OR SUFFER TO EXIST, ANY DEBT EXCEPT PERMITTED DEBT.
6.7
LIMITATION ON LIENS.
BORROWER SHALL NOT,
AND SHALL NOT PERMIT ANY SUBSIDIARY TO, CREATE OR SUFFER TO BE CREATED OR TO
EXIST ANY LIEN UPON ANY OF ITS PROPERTIES OR ASSETS EXCEPT PERMITTED LIENS.
6.8
BURDENSOME AGREEMENTS.
BORROWER SHALL NOT,