Document:

creditagreement_09282011.htm

 

 

 

CREDIT AGREEMENT

 

Dated as of September 28, 2011

 

among

 

SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP,

as the Borrower,

 

BANK OF AMERICA, N.A.,

 

as Administrative Agent, Swing Line Lender

 

and

 

L/C Issuer,

 

and

 

The Other Lenders Party Hereto

 

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

as

Sole Lead Arranger and Sole Book Manager

 

 

FIFTH THIRD BANK, AN OHIO BANKING CORPORATION

as

Syndication Agent

 

 

 

 

  

  

  

 

 

TABLE OF CONTENTS

 

Section                                                                                                                                                       Page     

 

	
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS.............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
1

	  	  	  	  
	  	
1.01

	
Defined Terms.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
1

	  	  	  	  
	
Applicable Margin for Eurodollar Loans/Letter of Credit Fees........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
2

	  	  	  	  
	  	
1.02

	
Other Interpretive Provisions.............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
26

	  	
1.03

	
Accounting Terms...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
27

	  	
1.04

	
Rounding...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
28

	  	
1.05

	
Times of Day.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
28

	  	
1.06

	
Letter of Credit Amounts.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
28

	  	  	  	  
	
ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS ..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
28

	  	  	  	  
	  	
2.01

	
Committed Loans..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
28

	  	
2.02

	
Borrowings, Conversions and Continuations of Committed Loans.............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
28

	  	
2.03

	
Intentionally Omitted........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
30

	  	
2.04

	
Letters of Credit....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
30

	  	
2.05

	
Swing Line Loans.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
38

	  	
2.06

	
Prepayments.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
40

	  	
2.07

	
Termination or Reduction of Commitments.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
41

	  	
2.08

	
Repayment of Loans............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
42

	  	
2.09

	
Interest...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
42

	  	
2.10

	
Fees.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
43

	  	
2.11

	
Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
43

	  	
2.12

	
Evidence of Debt..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
44

	  	
2.13

	
Payments Generally; Administrative Agent’s Clawback................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
44

	  	
2.14

	
Sharing of Payments by Lenders.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
46

	  	
2.15

	
Extension of Maturity Date...................................................................................................................................................................................................................................................................................................................................................................................................... ..........................................................................................................................................................

	
47

	  	
2.16

	
Increase in Commitments.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
48

	  	
2.17

	
Cash Collateral.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
49

	  	
2.18

	
Defaulting Lenders...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
50

	  	  	  	  
	
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
52

	  	  	  	  
	  	
3.01

	
Taxes.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
52

	  	
3.02

	
Illegality..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
55

	  	
3.03

	
Inability to Determine Rates................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
56

	  	
3.04

	
Increased Costs; Reserves on Eurodollar Rate Loans....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
56

	  	
3.05

	
Compensation for Losses....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
58

	  	
3.06

	
Mitigation Obligations; Replacement of Lenders............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
59

	  	
3.07

	
Survival...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
59

	  	  	  	  
	
ARTICLE IV. Borrowing Base...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
59

	  	  	  	  
	  	
4.01

	
Initial Borrowing Base..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
59

 

  

i

  

 

	  	
4.02

	
Changes in Borrowing Base Calculation...........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
59

	  	
4.03

	
Requests for Admission into Borrowing Base..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
60

	  	
4.04

	
Eligibility................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
60

	  	
4.05

	
Approval of Borrowing Base Properties............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
60

	  	
4.06

	
Liens on Borrowing Base Properties.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
60

	  	
4.07

	
Notice of Admission of New Borrowing Base Properties............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
60

	  	
4.08

	
Release of Borrowing Base Property..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
60

	  	
4.09

	
Exclusion Events................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
61

	  	
4.10

	
Documentation Required with Respect to Borrowing Base Properties.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
62

	  	  	  	  
	
ARTICLE V. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
62

	  	  	  	  
	  	
5.01

	
Conditions of Initial Credit Extension................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ 

	
62

	  	
5.02

	
Conditions to all Credit Extensions.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
64

	  	  	  	  
	
ARTICLE VI. REPRESENTATIONS AND WARRANTIES.............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
65

	  	  	  	  
	  	
6.01

	
Existence, Qualification and Power.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
65

	  	
6.02

	
Authorization; No Contravention.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
65

	  	
6.03

	
Governmental Authorization; Other Consents................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
65

	  	
6.04

	
Binding Effect.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
65

	  	
6.05

	
Financial Statements; No Material Adverse Effect...........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
66

	  	
6.06

	
Litigation.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
66

	  	
6.07

	
No Default...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
66

	  	
6.08

	
Ownership of Property; Liens..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
66

	  	
6.09

	
Environmental Compliance...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
67

	  	
6.10

	
Insurance.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
67

	  	
6.11

	
Taxes........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
67

	  	
6.12

	
ERISA Compliance................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
67

	  	
6.13

	
Subsidiaries; Equity Interests..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
68

	  	
6.14

	
Margin Regulations; Investment Company Act...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
68

	  	
6.15

	
Disclosure...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
68

	  	
6.16

	
Compliance with Laws..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
69

	  	
6.17

	
Taxpayer Identification Number..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
69

	  	  	  	  
	
ARTICLE VII. AFFIRMATIVE COVENANTS....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
69

	  	  	  	  
	  	
7.01

	
Financial Statements.............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
70

	  	
7.02

	
Certificates; Other Information............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
72

	  	
7.03

	
Notices....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
73

	  	
7.04

	
Payment of Obligations........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
73

	  	
7.05

	
Preservation of Existence, Etc..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
73

	  	
7.06

	
Maintenance of Properties...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
73

	  	
7.07

	
Maintenance of Insurance....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
73

	  	
7.08

	
Compliance with Laws..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
73

	  	
7.09

	
Books and Records................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
73

	  	
7.10

	
Inspection Rights..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
74

	  	
7.11

	
Use of Proceeds.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
74

	  	
7.12

	
Borrowing Base Properties...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
74

	  	
7.13

	
Subsidiary Guarantor Organizational Documents.............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
74

 

 

  

ii

  

 

	  	
7.14

	
Additional Guarantors.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
75

	  	
7.15

	
Environmental Matters........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
75

	  	
7.16

	
REIT Status; New York Stock Exchange Listing............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
75

	  	  	  	  
	
ARTICLE VIII. NEGATIVE COVENANTS.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
75

	  	  	  	  
	  	
8.01

	
Liens.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
76

	  	
8.02

	
Investments........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
76

	  	
8.03

	
Fundamental Changes......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
78

	  	
8.04

	
Dispositions..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
78

	  	
8.05

	
Restricted Payments............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
78

	  	
8.06

	
Change in Nature of Business............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
79

	  	
8.07

	
Transactions with Affiliates............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
79

	  	
8.08

	
Burdensome Agreements...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
79

	  	
8.09

	
Use of Proceeds................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
79

	  	
8.10

	
Borrowing Base Properties................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
80

	  	
8.11

	
RESERVED............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
80

	  	
8.12

	
RESERVED.............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
80

	  	
8.13

	
Negative Pledge; Indebtedness..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
80

	  	
8.14

	
Financial Covenants..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
81

	  	  	  	  
	
ARTICLE IX. EVENTS OF DEFAULT AND REMEDIES.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
81

	  	  	  	  
	  	
9.01

	
Events of Default.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
81

	  	
9.02

	
Remedies Upon Event of Default.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
83

	  	
9.03

	
Application of Funds...........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
84

	  	  	  	  
	
ARTICLE X. ADMINISTRATIVE AGENT.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
85

	  	  	  	  
	  	
10.01

	
Appointment and Authority............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
85

	  	
10.02

	
Rights as a Lender................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
85

	  	
10.03

	
Exculpatory Provisions.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
85

	  	
10.04

	
Reliance by Administrative Agent.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
86

	  	
10.05

	
Delegation of Duties............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ 

	
87

	  	
10.06

	
Resignation of Administrative Agent................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
87

	  	
10.07

	
Non-Reliance on Administrative Agent and Other Lenders..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
88

	  	
10.08

	
No Other Duties, Etc............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ 

	
88

	  	
10.09

	
Administrative Agent May File Proofs of Claim..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
88

	  	
10.10

	
Collateral and Guaranty Matters........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ 

	
89

	  	  	  	  
	
ARTICLE XI. MISCELLANEOUS........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ 

	
89

	  	  	  	  
	  	
11.01

	
Amendments, Etc.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
89

	  	
11.02

	
Notices; Effectiveness; Electronic Communication.........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
91

	  	
11.03

	
No Waiver; Cumulative Remedies; Enforcement............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
93

	  	
11.04

	
Expenses; Indemnity; Damage Waiver............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
94

	  	
11.05

	
Payments Set Aside............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
95

	  	
11.06

	
Successors and Assigns.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
96

	  	
11.07

	
Treatment of Certain Information; Confidentiality.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
100

	  	
11.08

	
Right of Setoff....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
101

	  	
11.09

	
Interest Rate Limitation........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ 

	
101

 

 

  

iii

  

 

 

	 	
11.10

	
Counterparts; Integration; Effectiveness.................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
102

	 	
11.11

	
Survival of Representations and Warranties............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ 

	
102

	 	
11.12

	
Severability..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
102

	 	
11.13

	
Replacement of Lenders...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
102

	 	
11.14

	
Governing Law; Jurisdiction; Etc................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ 

	
103

	 	
11.15

	
Waiver of Jury Trial......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
104

	 	
11.16

	
No Advisory or Fiduciary Responsibility................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
104

	 	
11.17

	
Electronic Execution of Assignments and Certain Other Documents................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 

	
105

	 	
11.18

	
USA PATRIOT Act.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

	
105

	 	
11.19

	
ENTIRE AGREEMENT................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 

	
105

	 	  	  	  
	
 

	 	 
	SIGNATURES	..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................	
S-1

 

 

  

iv

  

 

SCHEDULES

 

	
1.01 (A)       

	
Commitments and Applicable Percentages

	
1.01(B)       

	
Guarantors

	
1.01(C)       

	
SunChamp Collateral

	
1.01(D)       

	
SunChamp Property Owner Entities

	
1.01(E)       

	
Existing Letters of Credit

	
1.01(F)       

	
Equity Interest Collateral

	
1.01(G)       

	
Mortgage Assignments

	
4.01          

	
Initial Borrowing Base Properties

	
6.06          

	
Litigation

	
6.09          

	
Environmental Matters

	
6.13          

	
Subsidiaries; Other Equity Investments; Equity

	
6.17          

	
Loan Parties’ Taxpayer Identification Numbers

	
8.01          

	
Existing Liens

	
11.02         

	
Administrative Agent’s Office; Certain Addres

 

EXHIBITS

 

	
A           

	
Form of Committed Loan Notice

	
B           

	
Form of Swing Line Loan Notice

	
C           

	
Form of Note

	
D           

	
Form of Compliance Certificate

	
E-1         

	
Form of Assignment and Assumption

	
E-2         

	
Form of Administrative Questionnaire

	
F           

	
Opinion Matters

	
G           

	
Borrowing Base Report

 

 

  

v

  

 

CREDIT AGREEMENT

 

This CREDIT AGREEMENT (“Agreement”) is entered into as of September 28, 2011 among Sun Communities Operating Limited Partnership, a Michigan limited partnership (the “Borrower”), each of the Loan Parties from time to time party hereto, each lender from time to time party hereto (collectively, the “Lenders” and individually, a “Lender”), BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and Merrill Lynch, Pierce, Fenner & Smith Incorporated as Sole Lead Arranger and Sole Book Manager.

 

The Borrower has requested that the Lenders provide a revolving credit facility, and the Lenders are willing to do so on the terms and conditions set forth herein.

 

In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

 

ARTICLE I.  DEFINITIONS AND ACCOUNTING TERMS

 

1.01 Defined Terms

 

.  As used in this Agreement, the following terms shall have the meanings set forth below:

 

“Adjusted EBITDA” means EBITDA for the Consolidated Group for the most recently ended period of four fiscal quarters minus the aggregate Annual Capital Expenditure Adjustment.

 

“Administrative Agent” means Bank of America in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.

 

“Administrative Agent’s Office” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 11.02, or such other address or account as the Administrative Agent may from time to time notify to the Borrower and the Lenders.

 

“Administrative Questionnaire” means an Administrative Questionnaire in substantially the form of Exhibit E-2 or any other form approved by the Administrative Agent.

 

“Affiliate” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

 

“Aggregate Commitments” means the Commitments of all the Lenders.

 

“Agreement” means this Credit Agreement.

 

“Annual Capital Expenditure Adjustment” means for each Property, $50 per Site.

 

“Applicable Percentage” means with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of the Aggregate Commitments represented by such Lender’s Commitment at such time, subject to adjustment as provided in Section 2.18.  If the 

 

 

  

1

  

 

commitment of each Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 9.02 or if the Aggregate Commitments have expired, then the Applicable Percentage of each Lender shall be determined based on the Applicable Percentage of such Lender most recently in effect, giving effect to any subsequent assignments.  The initial Applicable Percentage of each Lender is set forth opposite the name of such Lender on Schedule 1.01(A) or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

 

“Applicable Rate” means the following percentages per annum, based upon the Leverage Ratio as set forth in the most recent Compliance Certificate received by the Administrative Agent pursuant to Section 7.02(a):

 

	
Level

	
Leverage Ratio

	
Applicable Margin for Eurodollar Loans/Letter of Credit Fees

	
Applicable Margin for Base Rate Loans

	
1

	
< 55%

	
2.25%

	
1.25%

	
2

	
≥ 55% but < 60%

	
2.50%

	
1.50%

	
3

	
≥ 60% but < 65%

	
2.75%

	
1.75%

	
4

	
≥ 65% but ≤ 70%

	
2.95%

	
1.95%

 

Any increase or decrease in the Applicable Rate resulting from a change in the Leverage Ratio shall become effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 7.02(a); provided, however, that if a Compliance Certificate is not delivered when due in accordance with such Section and such failure continues for five (5) days, then, upon the request of the Required Lenders, Pricing Level 4 shall apply as of the first Business Day after the date on which such Compliance Certificate was required to have been delivered and shall remain in effect until the date on which such Compliance Certificate is delivered.  The Applicable Rate in effect as of the Closing Date shall be determined based upon Pricing Level 3.

 

“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

 

“Arranger” means Merrill Lynch, Pierce, Fenner & Smith Incorporated, in its capacity as sole lead arranger and sole book manager.

 

“Assignee Group” means two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same investment advisor.

 

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 11.06(b)), and accepted by the Administrative Agent, in substantially the form of Exhibit E-1 or any other form approved by the Administrative Agent.

 

“Attributable Indebtedness” means, on any date, (a) in respect of any capital lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person

 

 

  

2

  

 

prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capital lease.

 

“Audited Financial Statements” means the audited consolidated balance sheet of the Parent and its Subsidiaries for the fiscal year ended December 31, 2010, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for such fiscal year of the Parent and its Subsidiaries, including the notes thereto.

 

“Availability Period” means the period from and including the Closing Date to the earliest of (a) the Maturity Date, (b) the date of termination of the Aggregate Commitments pursuant to Section 2.07, subject to the rescission right contained therein, and (c) the date of termination of the commitment of each Lender to make Loans and of the obligation of the L/C Issuer to make L/C Credit Extensions pursuant to Section 9.02.

 

“Bank of America” means Bank of America, N.A. and its successors.

 

“Base Rate” means for any day a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 1/2 of 1%, (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate,” and (c) the one-month Eurodollar Rate plus 1.00%.  The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate.  Any change in such prime rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change.

 

“Base Rate Committed Loan” means a Committed Loan that is a Base Rate Loan.

 

“Base Rate Loan” means a Loan that bears interest based on the Base Rate.

 

“Borrower” has the meaning specified in the introductory paragraph hereto.

 

“Borrower Materials” has the meaning specified in Section 7.02.

 

“Borrowing” means a Committed Borrowing or a Swing Line Borrowing, as the context may require.

 

“Borrowing Base Availability” means the lesser of: (a) 60% of the Borrowing Base Amount; or (b) the Mortgageability Amount.

 

“Borrowing Base Amount” means an amount equal to the aggregate Capitalized Value of all Borrowing Base Properties, determined quarterly.

 

“Borrowing Base NOI” means, at any time with respect to any real property asset owned by any Person, if owned for at least twelve (12) months, the Net Operating Income from such real property asset for the trailing twelve months; if owned for at least one fiscal quarter but less

 

  

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 than twelve months, the Net Operating Income from such real property asset for the most recent fiscal quarter times four; and if owned for less than one fiscal quarter, the Net Operating Income from such real property asset for most recent quarter of historical financials times four. For the avoidance of doubt, the Net Operating Income of a real property asset that is sold by a Person within the trailing twelve months will be excluded in calculating Borrowing Base NOI.  For the purposes of calculating Borrowing Base NOI:

 

(a)  no single Borrowing Base Property may account for greater than twenty percent (20%) of the aggregate Borrowing Base NOI, with any excess over such limit being deducted from the aggregate Borrowing Base NOI.

 

(b)  no more than twenty-five percent (25%) of the aggregate Borrowing Base NOI may be in respect of Borrowing Base Properties that are located in any one metropolitan statistical area, as defined by the U.S. Office of Management and Budget, with any excess over such limit being deducted from the aggregate Borrowing Base NOI.

 

(c)  no more than fifteen percent (15%) of the aggregate Borrowing Base NOI may be from recreational vehicle communities with any excess over such limit being deducted from the aggregate Borrowing Base NOI.

 

“Borrowing Base Property” means a Property or any of the SunChamp Properties that is designated as such by the Borrower and is an Eligible Property.

 

“Borrowing Base Report” means a report in substantially the form of Exhibit G (or such other form approved by Administrative Agent) certified by a Responsible Officer of Borrower.

 

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located and, if such day relates to any Eurodollar Rate Loan, means any such day that is also a London Banking Day.

 

“Capitalization Rate” means 7.75%.

 

                “Capitalized Value” means at any time and with respect to any Borrowing Base Property, the Borrowing Base NOI minus the Annual Capital Expenditure Adjustment but calculated exclusively with respect to such Borrowing Base Property divided by the Capitalization Rate.

 

“Cash Collateralize” means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Administrative Agent, L/C Issuer or Swing Line Lender (as applicable) and the Lenders, as collateral for L/C Obligations, Obligations in respect of Swing Line Loans, or obligations of Lenders to fund participations in respect of either thereof (as the context may require), cash or deposit account balances or, if the L/C Issuer or Swing Line Lender benefitting from such collateral shall agree in its sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to (a) the Administrative Agent and (b) the L/C Issuer or the Swing Line Lender (as applicable). “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.

 

 

  

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“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

 

“Change of Control” means an event or series of events by which:

 

(a)           during any period of 12 consecutive months, a majority of the members of the board of directors or other equivalent governing body of the Parent cease to be composed of individuals (i) who were members of that board or equivalent governing body on the first day of such period, (ii) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body or (iii) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body (excluding, in the case of both clause (ii) and clause (iii), 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).

 

(b)           the Parent fails at any time to own, directly or indirectly, at least 70% of the Equity Interests of each other Loan Party, free and clear of all Liens (other than the Liens in favor of the Administrative Agent), or ceases to be the general partner of the Borrower or ceases to Control all management and financial decisions of each Loan Party.

 

(c)           the Borrower fails at any time to own, directly or indirectly, 99% of the Equity Interests of each other Loan Party, free and clear of all Liens (other than the Liens in favor of the Administrative Agent.

 

(d)           the Borrower fails at any time to own, directly or indirectly, at least 75% of the Equity Interests of each of the SunChamp Property Owner Entities, free and clear of all Liens (other than the Liens in favor of the Administrative Agent, if any).

 

“Closing Date” means the first date all the conditions precedent in Section 5.01 are satisfied or waived in accordance with Section 11.01.

 

 

  

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“Code” means the Internal Revenue Code of 1986.

 

“Collateral” means the Equity Interest Collateral, the Mortgage Assignments, and all other property of the Pledgors on which Liens have been granted to Administrative Agent, for the benefit of the Lenders, to secure the Obligations.

 

“Commitment” means, as to each Lender, its obligation to (a) make Committed Loans to the Borrower pursuant to Section 2.01, (b) purchase participations in L/C Obligations, and (c) purchase participations in Swing Line Loans, in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Lender’s name on Schedule 1.01(A) or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement.

 

“Committed Borrowing” means a borrowing consisting of simultaneous Committed Loans of the same Type and, in the case of Eurodollar Rate Committed Loans, having the same Interest Period made by each of the Lenders pursuant to Section 2.01.

 

“Committed Loan” has the meaning specified in Section 2.01.

 

“Committed Loan Notice” means a notice of (a) a Committed Borrowing, (b) a conversion of Committed Loans from one Type to the other, or (c) a continuation of Eurodollar Rate Committed Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.

 

“Compliance Certificate” means a certificate substantially in the form of Exhibit D.

 

“Consolidated Group” means the Loan Parties and their consolidated Subsidiaries.

 

“Construction in Progress” means each formerly unimproved Real Property or portion thereof at which new site improvements have commenced.  Site improvements include, but are not limited to, land development, installation of roads, utilities, or other infrastructure developments and the development of new homesites.  A Real Property or portion thereof will cease to be classified as “Construction in Progress” on the earlier to occur of (A) the time that such Real Property or portion thereof has an occupancy rate of greater than seventy-five percent (75%), (B) one hundred eighty (180) days after completion of site improvements at such Real Property or portion thereof, or (C) such Real Property or portion thereof has been classified as “Construction in Progress” for more than eighteen (18) months, in which case, if such site improvements are not completed, such Real Property or portion thereof will be classified as unimproved land holdings.

 

“Contractual Obligation” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

 

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise

 

 

  

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 voting power, by contract or otherwise.  “Controlling” and “Controlled” have meanings correlative thereto.

 

“Credit Extension” means each of the following: (a) a Borrowing and (b) an L/C Credit Extension.

 

“Daily Usage” means, as of any date, the quotient (expressed as a percentage) of (a) the Total Outstandings on such date, divided by (b) the Aggregate Commitments on such date.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

 

“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time, or both, would be an Event of Default.

 

“Default Rate” means (a) when used with respect to Obligations other than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 2% per annum; provided, however, that with respect to a Eurodollar Rate Loan, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan plus 2% per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to the Applicable Rate plus 2% per annum.

 

“Defaulting Lender” means, subject to Section 2.18(b), any Lender that, as determined by the Administrative Agent, (a) has failed to perform any of its funding obligations hereunder,  including in respect of its Loans or participations in respect of Letters of Credit or Swing Line Loans, within three Business Days of the date required to be funded by it hereunder, (b) has notified the Borrower, or the Administrative Agent that it does not intend to comply with its funding obligations or has made a public statement to that effect with respect to its funding obligations hereunder or under other agreements in which it commits to extend credit, (c) has failed, within three Business Days after request by the Administrative Agent, to confirm in a manner satisfactory to the Administrative Agent that it will comply with its funding obligations, or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or a custodian appointed for it, or (iii) taken any action in furtherance of, or indicated its consent to, approval of or acquiescence in any such proceeding or appointment; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority.

 

“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, 

 

  

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assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.

 

“Dollar” and “$” mean lawful money of the United States.

 

“EBITDA” means for the Consolidated Group, without duplication, the sum of (a) Net Income of the Consolidated Group, in each case, excluding (i) any non recurring or extraordinary gains and losses for such period, (ii) any income or gain and any loss in each case resulting from early extinguishment of indebtedness and (iii) any net income or gain or any loss resulting from a swap or other derivative contract (including by virtue of a termination thereof), plus (b) an amount which, in the determination of Net Income for such period pursuant to clause (a) above, has been deducted for or in connection with (i) Interest Expense (plus, amortization of deferred financing costs, to the extent included in the determination of Interest Expense per GAAP), (ii) income taxes, and (iii) depreciation and amortization inclusive of intangibles, all determined in accordance with GAAP for the prior four quarters, plus (c) the Consolidated Group’s pro rata share of the above attributable to interests in Unconsolidated Affiliates, with the exception of Origen Financial Inc. and Origen Financial Services, Inc., plus (d) non-cash deferred compensation.

 

“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 11.06(b)(iii), and (v) (subject to such consents, if any, as may be required under Section 11.06(b)(iii)).

 

“Eligible Property” means Property reasonably acceptable to the Administrative Agent that meets and continues to satisfy each of the following criteria:

 

(a)  Property types: manufactured home communities or recreation vehicle communities.

 

(b)  Except for the SunChamp Property Owner Entities, the Loan Party that owns such Property must be wholly-owned, directly or indirectly, by the Borrower and/or Parent (or be a subsidiary of the Borrower and/or Parent that is controlled exclusively by the Borrower and/or Parent and/or one or more wholly-owned Subsidiaries of the Borrower, including control over operating activities of such Subsidiary and the ability of such Subsidiary to dispose of, pledge or otherwise encumber assets, incur, repay and prepay debt, provide guarantees and pay dividends and distributions in each case without any requirement for the consent of any other party or entity).

 

(c)  The Loan Party that owns such Property and the Property itself must be located in the United States.

 

(d)  The Property may not be subject to any Liens, negative pledges and/or encumbrances or any restrictions on the ability of the applicable Loan Party to transfer or encumber such Property or income therefrom or proceeds thereof (other than the pledge of Equity Interests to secure the Obligations, certain permitted Liens and Liens to secure the SunChamp Indebtedness).

 

(e)  There may not exist any Lien (other than to secure the Obligations and other than certain permitted Liens) on any of the Collateral, except for Liens to secure the SunChamp Indebtedness.

 

  

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(f)  All management agreements, if any, pertaining to the Property must be reasonably acceptable to the Administrative Agent.

 

(g)  The Property may not be subject to title defects, survey defects, environmental violations or other defects, which could reasonably be expected to cause a Material Property Event.

 

(h)  The Loan Party that owns the Property may not incur or otherwise be liable for any Indebtedness other than the Obligations and other Indebtedness permitted to be incurred by Loan Parties hereunder, including the SunChamp Indebtedness.

 

(i)  The receipt by the Administrative Agent of a Phase I environmental report with respect to each Borrowing Base Property which has not previously been included as a borrowing base property pursuant to the Existing Credit Agreement, prepared by a qualified firm reasonably acceptable to the Administrative Agent which finds, among other things, that such Borrowing Base Property is not impaired by Hazardous Materials in violation of applicable Laws (other than commercially reasonable amounts).  Phase I environmental reports have been received by the Administrative Agent for all Initial Borrowing Base Properties.

 

(j)  The receipt by the Administrative Agent of evidence demonstrating compliance of each Borrowing Base Property with insurance requirements hereunder, which will include federally-mandated flood insurance requirements for flood insurance if all or any portion of any building is located within a federally designated flood hazard zone.

 

(k)  Such other reasonable criteria as reasonably determined by the Administrative Agent upon further due diligence with respect to any proposed Borrowing Base Property, and consistent with recreational vehicle and manufactured home asset class.

 

For any Property that does not satisfy all the above-listed criteria to be added as a Borrowing Base Property after the Closing Date, the Required Lenders will have ten (10) Business Days from the receipt of historical operating statements and other Property level diligence materials (including without limitation surveys, environmental assessments and other third party reports) to approve/disapprove the designation of a Property as a Borrowing Base Property, if any Lender fails to respond during the 10-day period, such Lender shall be deemed to have approved.

 

Notwithstanding anything set forth above, the Real Property owned by the SunChamp Property Owners Entities shall be deemed Eligible Property and Initial Borrowing Base Properties for purposes of this Agreement, but shall be subject to all terms set forth herein with respect to ongoing inclusion of such property as Borrowing Base Properties.

 

“Environmental Laws” means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems.

 

  

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“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower, any other Loan Party or any of their respective Subsidiaries directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

 

“Equity Interest Collateral” means the Equity Interests listed on Schedule 1.01(F), as such Schedule may be amended from time to time upon the inclusion or removal of any new Borrowing Base Property in the calculation of Borrowing Base Availability.

 

“Equity Interests” means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

 

“ERISA” means the Employee Retirement Income Security Act of 1974.

 

“ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

 

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) the withdrawal of the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which such entity was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Pension Plan amendment as a termination under Section 4041 or 4041A of ERISA; (e) the institution by the PBGC of proceedings to terminate a Pension Plan; (f) any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; (g) the determination that any Pension Plan is considered an at-risk plan or a plan in endangered or critical status within the meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304 and 305 of ERISA; or (h) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon  the Borrower or any ERISA Affiliate.

 

“Eurodollar Rate” means:

 

  

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(a) for any Interest Period with respect to a Eurodollar Rate Loan, the rate per annum equal to (i) the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or such other commercially available source providing quotations of BBA LIBOR as may be designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two London Banking Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or, (ii) if such rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or converted and with a term equivalent to such Interest Period would be offered by Bank of America’s London Branch to major banks in the London interbank Eurodollar market at their request at approximately 11:00 a.m. (London time) two London Banking Days prior to the commencement of such Interest Period; and

 

(b) for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to (i) BBA LIBOR, at approximately 11:00 a.m., London time determined two London Banking Days prior to such date for Dollar deposits being delivered in the London interbank market for a term of one month commencing that day or (ii) if such published rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the date of determination in same day funds in the approximate amount of the Base Rate Loan being made or maintained and with a term equal to one month would be offered by Bank of America’s London Branch to major banks in the London interbank Eurodollar market at their request at the date and time of determination.

 

“Eurodollar Rate Committed Loan” means a Committed Loan that bears interest at a rate based on clause (a) of the definition of “Eurodollar Rate.”

 

“Eurodollar Rate Loan” means a Eurodollar Rate Committed Loan.

 

“Event of Default” has the meaning specified in Section 9.01.

 

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the L/C Issuer or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) 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, (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which the Borrower is located, (c) any backup withholding tax that is required by the Code to be withheld from amounts payable to a Lender that has failed to comply with clause (A) of Section 3.01(e)(ii), and (d) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 11.13), any United States withholding tax that (i) is required to be imposed on amounts payable to such Foreign Lender pursuant to the Laws in force at the time such Foreign Lender becomes a party hereto (or designates a new Lending Office) or (ii) is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with clause (B) of Section

 

 

  

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3.01(e)(ii), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending Office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 3.01(a)(ii) or (c).

 

“Exclusion Event” has the meaning specified in Section 4.09.

 

“Exclusion Notice” has the meaning specified in Section 4.09.

 

“Existing Credit Agreement” means that certain Credit Agreement dated as of September 30, 2004, as amended, among the Borrower, Bank of America, N.A., as successor to Standard Federal Bank National Association, as administrative agent, and a syndicate of lenders.

 

“Existing Letters of Credit” means those letters of credit described on Schedule 1.01(E).

 

“Existing Maturity Date” has the meaning specified in Section 2.15.

 

“Extension Option” has the meaning specified in Section 2.15.

 

“FASB ASC” means the Accounting Standards Codification of the Financial Accounting Standards Board.

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Administrative Agent.

 

“Fee Letter” means the letter agreement, dated July 25, 2011, among the Borrower, the Administrative Agent and the Arranger.

 

“Fixed Charges” means for the Consolidated Group, without duplication, the sum of (a) Interest Expense, plus (b) scheduled principal payments, exclusive of balloon payments, plus (c) dividends and distributions on preferred stock, if any (excluding dividends and distributions with respect to Series A-1 Preferred Units (KentlandA-1)), plus (d) the Consolidated Group’s pro rata share of the above attributable to interests in Unconsolidated Affiliates with the exception of Origen Financial Inc. and Origen Financial Services, Inc., all for the most recently ended period of four fiscal quarters.

 

“Foreign Lender” means any Lender that is organized under the Laws of a jurisdiction other than that in which the Borrower is resident for tax purposes (including such a Lender when acting in the capacity of the L/C Issuer).  For purposes of this definition, the United States, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

 

  

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“FRB” means the Board of Governors of the Federal Reserve System of the United States.

 

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with respect to the L/C Issuer, such Defaulting Lender’s Applicable Percentage of the outstanding L/C Obligations other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to the Swing Line Lender, such Defaulting Lender’s Applicable Percentage of Swing Line Loans other than Swing Line Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.

 

“Fund” means 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 activities.

 

“Funds From Operations” means, with respect to the immediately prior twelve month period, the Consolidated Group’s Net Income (or loss), plus depreciation and amortization, inclusive of intangibles and after adjustments for unconsolidated partnerships and joint ventures as hereafter provided. For purposes hereof, (a) “Funds From Operations” shall include, and be adjusted to take into account, the Borrower’s interests in unconsolidated partnerships and joint ventures, on the same basis as consolidated partnerships and subsidiaries, as provided in the “white paper” issued in April 2002 by the National Association of Real Estate Investment Trusts, and (b) net income (or loss) shall not include gains (or, if applicable, losses) resulting from or in connection with (i) restructuring of indebtedness, (ii) sales of property, (iii) sales or redemptions of preferred stock, (iv) non-cash charges, or (v) non-recurring charges.

 

“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

 

“Governmental Authority” means the government of the United States or any other nation, or of 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 (including any supra-national bodies such as the European Union or the European Central Bank).

 

“Guarantee” means, as to any Person, (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the 

 

 

  

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purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien).  The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by GAAP.  The term “Guarantee” as a verb has a corresponding meaning.

 

“Guaranties” means the Parent Guaranty and the Subsidiary Guaranty, and “Guaranty” means any one of the Guaranties.

 

“Guarantors” means, collectively, Parent and each Subsidiary Guarantor, and “Guarantor” means any one of the Guarantors.  The initial Guarantors are listed on Schedule 1.01(B).

 

“Hazardous Materials” means 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, excessive moisture, mildew, mold, microbial contamination, microbial growth or other fungi, or biological agents that can or are known to produce mycotoxins or other bioaerosols, such as antigens, bacteria, amoebae and microbial organic compounds or other similar matter, in each case that poses a material risk to human health or the environment, or negatively impacts the value of a Property in any material respect, and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“Improved Land Holdings” means all vacant developed homesites owned by the members of the Consolidated Group other than homesites classified as Construction in Progress whose value shall be determined by taking (a)(1) the net book value of all homesites owned by the members of the Consolidated Group other than homesites classified as Construction in Progress divided by (2) the total number of all homesites owned by the members of the Consolidated Group other than homesites classified as Construction in Progress, multiplied by (b) the total number of such vacant developed homesites other than homesites classified as Construction in Progress.

 

“Indebtedness” means, for the Consolidated Group, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

 

(a)           all obligations for borrowed money and all obligations evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

 

 

  

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(b)           all direct or contingent obligations under letters of credit (including standby and commercial), bankers’ acceptances and similar instruments (including bank guaranties and surety bonds, to the extent such instruments or agreements support financial, rather than performance, obligations;

 

(c)           net obligations under any Swap Contract (exclusive of any obligations secured by cash collateral);

 

(d)           all obligations to pay the deferred purchase price of property or services;

 

(e)           capital leases, Synthetic Lease Obligations and Synthetic Debt;

 

(f)           all obligations to purchase, redeem, retire, defease or otherwise make any cash payment in respect of any equity interest, to the extent required to be purchased, redeemed, retired, or defeased for cash prior to the Maturity Date, valued, in the case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference, plus accrued and unpaid dividends, if any;

 

(g)           indebtedness (excluding prepaid interest thereon) secured by a Lien on property (including indebtedness arising under conditional sales or other title retention agreements) whether or not such indebtedness has been assumed by the grantor of the Lien or is limited in recourse;

 

(h)           all Guarantees in respect of any of the foregoing.

 

For all purposes hereof, Indebtedness shall include the Consolidated Group’s pro rata share of the foregoing items and components attributable to Indebtedness of Unconsolidated Affiliates, with the exception of Origen Financial Inc. and Origen Financial Services, Inc., but shall not include any Indebtedness due from any entity which is included in the Consolidated Group to any other entity included in the Consolidated Group. The amount of any net obligation under any Swap Contract on any date shall be deemed to be the Swap Termination Value thereof as of such date.  The amount of any capital lease or Synthetic Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.

 

“Indemnified Taxes” means Taxes other than Excluded Taxes.

 

“Indemnitees” has the meaning specified in Section 11.04(b).

 

“Information” has the meaning specified in Section 11.07.

 

“Initial Borrowing Base Properties” means the Properties listed on Schedule 4.01, and “Initial Borrowing Base Property” means any one of the Initial Borrowing Base Properties.

 

“Interest Expense” means, without duplication, total cash interest expense of the Consolidated Group determined in accordance with GAAP (including for the avoidance of doubt capitalized interest and interest expense attributable to the Consolidated Group’s ownership

 

 

  

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interests in Unconsolidated Affiliates, with the exception of Origen Financial Inc. and Origen Financial Services, Inc.), all for the most recently ended period of four fiscal quarters

 

“Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan, the last day of each Interest Period applicable to such Loan and the Maturity Date; provided, however, that if any Interest Period for a Eurodollar Rate Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Base Rate Loan (including a Swing Line Loan), the first Business Day of each March, June, September and December and the Maturity Date.

 

“Interest Period” means as to each Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan is disbursed or (in the case of any Eurodollar Rate Committed Loan) converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three or six months thereafter, as selected by the Borrower in its Committed Loan Notice:

 

(i)           any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless, in the case of a Eurodollar Rate Loan, such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;

 

(ii)           any Interest Period pertaining to a Eurodollar Rate Loan that 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 the calendar month at the end of such Interest Period; and

 

(iii)           no Interest Period shall extend beyond the Maturity Date.

 

“Investment” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other securities of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor Guarantees Indebtedness of such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute a business unit.  For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

 

“IRS” means the United States Internal Revenue Service.

 

“ISP” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).

 

“Issuer Documents” means with respect to any Letter of Credit, the Letter of Credit Application, and any other document, agreement and instrument entered into by the L/C Issuer and the Borrower (or any Subsidiary) or in favor of the L/C Issuer and relating to such Letter of Credit.

 

 

  

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“Laws” means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.

 

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Applicable Percentage.

 

“L/C Borrowing” means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the date when made or refinanced as a Committed Borrowing.

 

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.

 

“L/C Issuer” means Bank of America in its capacity as issuer of Letters of Credit hereunder, or any successor issuer of Letters of Credit hereunder.

 

“L/C Obligations” means, as at any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts, including all L/C Borrowings.  For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.06.  For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

 

“Lender” has the meaning specified in the introductory paragraph hereto and, as the context requires, includes the Swing Line Lender.

 

“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.

 

“Letter of Credit” means any standby letter of credit issued hereunder and shall include the Existing Letters of Credit.

 

“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by the L/C Issuer.

 

“Letter of Credit Expiration Date” means the day that is seven (7) days prior to the Maturity Date then in effect (or, if such day is not a Business Day, the next preceding Business Day), provided that if a Letter of Credit is Cash Collateralized in accordance with Section 2.17 at least 30 days prior to the Maturity Date the Letter of Credit Expiration Date may be up to one (1) year after the Maturity Date.

 

 

  

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“Letter of Credit Fee” has the meaning specified in Section 2.04(h).

 

“Letter of Credit Sublimit” means an amount equal to ten percent (10%) of the Aggregate Commitments of the Lenders.  The Letter of Credit Sublimit is part of, and not in addition to, the Aggregate Commitments.

 

“Leverage Ratio” means, as of any date of determination, the ratio of (a) Total Indebtedness to (b) Total Asset Value.

 

“Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).

 

“Loan” means an extension of credit by a Lender to the Borrower under Article II in the form of a Committed Loan or a Swing Line Loan.

 

“Loan Documents” means this Agreement, each Note, each Issuer Document, any agreement creating or perfecting rights in Cash Collateral pursuant to the provisions of Section 2.17 of this Agreement, the Fee Letter, and the Guaranty.

 

“Loan Parties” means, collectively, the Borrower and each Guarantor.

 

“London Banking Day” means any day on which dealings in Dollar deposits are conducted by and between banks in the London interbank Eurodollar market.

 

“Material Adverse Effect” means (A) a material adverse change in, or a material adverse effect on, the operations, business, assets, properties, liabilities (actual or contingent), or condition (financial or otherwise) of the Parent or the Borrower and its Subsidiaries, taken as a whole; (B) a material adverse effect on the rights and remedies of the Administrative Agent or any Lender under any Loan Documents, or of the ability of the Borrower and the Loan Parties taken as a whole to perform their obligations under any Loan Documents; and (C) a material adverse effect upon the legality, validity, binding effect or enforceability against any Loan Party of any Loan Documents to which it is a party.

 

“Material Environmental Event” means, with respect to any Borrowing Base Property, (a) a violation of any Environmental Law with respect to such Borrowing Base Property, or (b) the presence of any Hazardous Materials on, about, or under such Borrowing Base Property that, under or pursuant to any Environmental Law, would require remediation, if in the case of either (a) or (b), such event or circumstance could reasonably be expected to have a Material Property Event.

 

“Material Property Event” means, with respect to any Borrowing Base Property, the occurrence of any event or circumstance occurring or arising after the date of this Agreement that could reasonably be expected to have a (a) material adverse effect with respect to the financial condition or the operations of such Borrowing Base Property, (b) material adverse

 

 

  

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effect on the value of such Borrowing Base Property, or (c) material adverse effect on the ownership of such Borrowing Base Property.

 

“Maturity Date” means the later of (a) October 1, 2014 and (b) if maturity is extended pursuant to Section 2.15, such extended maturity date as determined pursuant to such Section; provided, however, that, in each case, if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.

 

“Maximum Availability” means the lesser of: (a) the Aggregate Commitments; or (b) the Borrowing Base Availability.

 

“Mortgage Assignments” means those mortgage assignments listed on Schedule 1.01(G).

 

“Mortgageability Amount” means the maximum amount of principal which can be supported by the aggregate Mortgageability Cash Flow from all the Borrowing Base Properties, assuming a 30-year amortization and an interest rate which is the greater of (i) the 10-Year Treasury Rate + 2.50% or (ii) 7.0%, and a minimum debt service coverage ratio of 1.50 to 1.00.

 

“Mortgageability Cash Flow” means at any time and with respect to any Borrowing Base Property, the Borrowing Base NOI from such Borrowing Base Property, minus the Annual Capital Expenditure Adjustment, but calculated exclusively with respect to such Borrowing Base Property, minus an amount equal to four percent (4%) of rents for management fees.

 

“Multiemployer Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

 

“Multiple Employer Plan” means a Plan which has two or more contributing sponsors (including the Borrower or any ERISA Affiliate) at least two of whom are not under common control, as such a plan is described in Section 4064 of ERISA.

 

“Net Income” means the net income (or loss) of the Consolidated Group for the subject period; provided, however that Net Income shall exclude (a) extraordinary gains and extraordinary losses for such period, (b) the net income of any subsidiary of the Parent during such period to the extent that the declaration or payment of dividends or similar distributions by such subsidiary of such income is not permitted by operation of the terms of its organization documents or any agreement, instrument or law applicable to such subsidiary during such period, except that the Parent’s equity in any net loss of any such subsidiary for such period shall be included in determining Net Income, and (c) any income (or loss) for such period of any Person if such Person is not a subsidiary of the Parent, except that the Parent’s equity in the net income of any such Person for such period shall be included in Net Income up to the aggregate amount of cash actually distributed by such Person during such period to the Parent or a subsidiary thereof as a dividend or other distribution (and in the case of a dividend or other distribution to a subsidiary of the Parent, such subsidiary is not precluded from further distributing such amount to the Parent as described in clause (b) of this proviso).

 

  

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“Net Operating Income” means for any Real Property and for any period, an amount equal to (a) the aggregate gross revenues from the operations of such Real Property during such period derived from tenants in occupancy and paying rent, minus (b) the sum of all expenses and other proper charges incurred in connection with the operation of such Real Property during such period (including accruals for real estate taxes and insurance, but excluding  any management fees actually paid in cash, debt service charges, income taxes, state taxes, depreciation, amortization and other non-cash expenses),  which expenses and accruals shall be calculated in accordance with GAAP.

 

“Non-Recourse Indebtedness” means, with respect to a Person, Indebtedness for borrowed money in respect of which recourse for payment (except for customary exceptions to nonrecourse liability, such as fraud, misapplication of funds and environmental indemnities, and customary exceptions which trigger recourse for payment of the entire indebtedness, such as bankruptcy, insolvency, receivership or other similar events) is contractually limited to specific assets of such Person encumbered by a Lien securing such Indebtedness.

 

“Note” means a promissory note made by the Borrower in favor of a Lender evidencing Loans made by such Lender, substantially in the form of Exhibit C.

 

“Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit, or any Swap Contract, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.

 

“Organization Documents” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

 

“Other Taxes” means 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 under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

 

“Outstanding Amount” means (i) with respect to Committed Loans and Swing Line Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Committed Loans and Swing Line Loans, as the 

 

  

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case may be, occurring on such date; and (ii) with respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements by the Borrower of Unreimbursed Amounts.

 

“Parent” means Sun Communities, Inc., a Maryland corporation.

 

“Parent Guaranty” means the Guaranty executed by Parent in favor of Administrative Agent, for the benefit of the Lenders, in form and substance acceptable to Administrative Agent.

 

“Participant” has the meaning specified in Section 11.06(d).

 

“PBGC” means the Pension Benefit Guaranty Corporation.

 

“Pension Act” means the Pension Protection Act of 2006.

 

“Pension Funding Rules” means the rules of the Code and ERISA regarding minimum required contributions (including any installment payment thereof) to Pension Plans and set forth in, with respect to plan years ending prior to the effective date of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter, Section 412, 430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

 

“Pension Plan” means any employee pension benefit plan (including a Multiple Employer Plan or a Multiemployer Plan) that is maintained or is contributed to by the Borrower and any ERISA Affiliate and is either covered by Title IV of ERISA or is subject to the minimum funding standards under Section 412 of the Code.

 

“Permitted Distributions” means (a) for Borrower for any fiscal year of Borrower, Restricted Payments in an amount not to exceed in the aggregate the greater of (i) 95% of Funds From Operations, calculated on a trailing twelve month basis, and (ii) the sum of (A) the amount of Restricted Payments required to be paid by the Parent in order for it to (x) maintain its REIT status for federal or state income tax purposes and (y) avoid the payment of federal or state income or excise tax, plus (B) corresponding pro rata distributions to the Limited Partners of the Borrower; provided, however that (1) during an Event of Default under Section 9.01(a), Restricted Payments by the Borrower to the Parent, with corresponding pro rata distributions to the Limited Partners of the Borrower, and by the Parent to its shareholders, shall only be permitted up to the minimum amount needed to maintain the REIT status as a REIT for federal and state income tax purposes, and (2) notwithstanding the preceding clause (1), no Restricted Payments will be permitted following acceleration of amounts owing hereunder or during the existence of an Event of Default under Section 9.01(f).

 

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

 

“Plan” means any employee benefit plan within the meaning of Section 3(3) of ERISA (including a Pension Plan), maintained for employees of the Borrower or any ERISA Affiliate or

 

  

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any such Plan to which the Borrower or any ERISA Affiliate is required to contribute on behalf of any of its employees.

 

“Platform” has the meaning specified in Section 7.02.

 

“Pledge Agreement” means each Pledge Agreement or similarly titled document, executed by a Pledgor, to or for the benefit of Administrative Agent, for the benefit of the Lenders, covering the Equity Interest Collateral.

 

“Pledgors” means, collectively, those entities that execute the Pledge Agreement as a Pledgor; “Pledgor” means any one of the Pledgors.

 

“Property” means any Real Property which is owned, directly or indirectly, by a Loan Party.

 

“Property Information” has the meaning specified in Section 4.03.

 

“Property Owners” means, collectively, each Subsidiary which owns a Borrowing Base Property, other than the SunChamp Property Owner Entities, and “Property Owner” means any one of the Property Owners.

 

“Public Lender” has the meaning specified in Section 7.02.

 

“Real Property” of any Person means all of the right, title, and interest of such Person in and to land, improvements, and fixtures.

 

“Recourse Indebtedness” means Indebtedness for borrowed money other than Non-Recourse Indebtedness.

 

“Register” has the meaning specified in Section 11.06(c).

 

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees and advisors of such Person and of such Person’s Affiliates.

 

“Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 day notice period has been waived.

 

“Request for Credit Extension” means (a) with respect to a Borrowing, conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with respect to an L/C Credit Extension, a Letter of Credit Application, and (c) with respect to a Swing Line Loan, a Swing Line Loan Notice.

 

“Required Lenders” means, as of any date of determination, Lenders having at least 66-2/3% of the Aggregate Commitments or, if the commitment of each Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 9.02, Lenders holding in the aggregate at least 66-2/3% of the Total Outstandings (with the aggregate amount of each Lender’s risk participation and funded participation in L/C

 

  

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Obligations and Swing Line Loans being deemed “held” by such Lender for purposes of this definition); provided that the Commitment of, and the portion of the Total Outstandings held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

 

“Responsible Officer” means the chief executive officer, president, chief financial officer, treasurer, assistant treasurer or controller of a Loan Party, and solely for purposes of the delivery of incumbency certificates pursuant to Section 5.01, the secretary or any assistant secretary of a Loan Party.  Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

 

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any capital stock or other Equity Interest of the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such capital stock or other Equity Interest, or on account of any return of capital to the Borrower’s stockholders, partners or members (or the equivalent Person thereof).

 

“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

 

“Secured Indebtedness” means for any Person, Indebtedness of such Person that is secured by a Lien.

 

“Secured Recourse Indebtedness” means for any Person, Recourse Indebtedness of such Person that is secured by a Lien.

 

“Security Documents” means:

 

(a)           the Pledge Agreements;

 

(b)           the Mortgage Assignments;

 

(c)           financing statements to be filed with the appropriate state and/or county offices for the perfection of a security interest in any of the Collateral; and

 

(d)           all other agreements, documents, and instruments securing the Obligations or any part thereof, as shall from time to time be executed and delivered by Borrower, Subsidiary Guarantors, or any other Person in favor of Administrative Agent.

 

“Site” means a pad leased or to be leased to an individual on which such individual places a single manufactured home or recreational vehicle.

 

“Solvent” means, when used with respect to any Person, that (a) the fair value and the fair salable value of its assets (excluding any Indebtedness due from any affiliate of such Person) are 

 

  

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each in excess of the fair valuation of its total liabilities (including all contingent liabilities); (b) such Person is able to pay its debts or other obligations in the ordinary course as they mature; and (c) such Person has capital not unreasonably small to carry on its business and all business in which it proposes to be engaged.

 

“Subsidiary” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned by such Person.  Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Borrower.

 

“Subsidiary Guarantors” means, all Subsidiaries that execute the Subsidiary Guaranty as of the date of this Agreement or pursuant to a counterpart signature page or joinder to the Subsidiary Guaranty in the future in accordance with Section 7.14 of this Agreement  and “Subsidiary Guarantor” means any one of the Subsidiary Guarantors.

 

“Subsidiary Guaranty” means the Guaranty executed by each Subsidiary Guarantor in favor of Administrative Agent, for the benefit of the Lenders, in form and substance acceptable to Administrative Agent.

 

“SunChamp Collateral” means those loan documents listed on Schedule 1.01(C).

 

“SunChamp Indebtedness” means all indebtedness evidenced by the SunChamp Collateral.

 

“SunChamp Properties” means all Real Property owned by any of the SunChamp Property Owner Entities.

 

“SunChamp Property Owner Entities” means each of the entities listed on Schedule 1.01(D).

 

“Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), 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.

 

  

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“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender).

 

“Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to Section 2.05.

 

“Swing Line Lender” means Bank of America in its capacity as provider of Swing Line Loans, or any successor swing line lender hereunder.

 

“Swing Line Loan” has the meaning specified in Section 2.05(a).

 

“Swing Line Loan Notice” means a notice of a Swing Line Borrowing pursuant to Section 2.05(b), which, if in writing, shall be substantially in the form of Exhibit B.

 

“Swing Line Sublimit” means an amount equal to ten percent (10%) of the Aggregate Commitments of the Lenders.  The Swing Line Sublimit is part of, and not in addition to, the Aggregate Commitments.

 

“Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).

 

“Tangible Net Worth” means for the Consolidated Group as of any date of determination, (a) total equity on a consolidated basis determined in accordance with GAAP; plus (b) all redeemable and/or convertible preferred units, provided, such redemption or conversion rights are exercisable with respect to such securities after the Maturity Date; minus (c) all intangible assets on a consolidated basis determined in accordance with GAAP plus (d) all depreciation and amortization determined in accordance with GAAP.

 

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

“Total Asset Value” means at any time for the Consolidated Group, without duplication, the sum of the following: (a) an amount equal to (1) (x) Net Operating Income for the most recently ended period of four fiscal quarters from all Real Property assets owned by the Consolidated Group other than Construction in Progress for then most recently ended period of four fiscal quarters plus (y) Net Operating Income for the most recently ended fiscal quarter from all Real Property assets owned by the Consolidated Group other than Construction in Progress for at least one full fiscal quarter but less than the most recently ended period of four fiscal 

 

  

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quarters, times four, divided by (2) the Capitalization Rate, plus (b) the aggregate acquisition cost of all Real Property assets owned by the Consolidated Group other than Construction in Progress for less than one full fiscal quarter, plus (c) the lesser of (1) the aggregate book value of all Improved Land Holdings and unimproved land holdings other than Construction in Progress and (2)  $150,000,000, plus (d) the aggregate book value of mortgage or mezzanine loans, notes receivable and/or Construction in Progress owned by the Consolidated Group, plus (e) the Consolidated Group’s pro rata share of the foregoing items and components attributable to interest in Unconsolidated Affiliates with the exception of Origen Financial Inc. and Origen Financial Services, Inc., plus (f) unrestricted cash and cash equivalents. For the avoidance of doubt, Net Operating Income attributable to all such Real Property assets that were sold or otherwise disposed of during any period of calculation shall be excluded from the calculation of Total Asset Value.

 

“Total Indebtedness” means all Indebtedness of the Consolidated Group determined on a consolidated basis.

 

“Total Outstandings” means the aggregate Outstanding Amount of all Loans and all L/C Obligations.

 

“Total Secured Indebtedness” means all Secured Indebtedness of the Consolidated Group determined on a consolidated basis.

 

“Type” means its character as a Base Rate Loan or a Eurodollar Rate Loan.

 

“Unconsolidated Affiliate” means an affiliate of the Borrower whose financial statements are not required to be consolidated with the financial statements of the Borrower in accordance with GAAP.

 

“United States” and “U.S.” mean the United States of America.

 

“Unreimbursed Amount” has the meaning specified in Section 2.04(c)(i).

 

“Unused Rate” means the following percentages per annum based upon the Daily Usage as set forth below:

 

	
Daily Usage

	
Unused Rate

	
<50%

	
0.35%

	
>50%

	
0.25%

 

 

1.02 Other Interpretive Provisions.  With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

 

(a) 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.”  Unless the context 

 

  

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requires otherwise, (i) any definition of or reference to any agreement, instrument or other document (including any Organization Document) shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (iii) the words “hereto,” “herein,” “hereof” and “hereunder,” and words of similar import when used in any Loan Document, shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, and (vi) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

 

(b) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including.”

 

(c) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

 

1.03 Accounting Terms.

 

(a) Generally.  All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the Audited Financial Statements, except as otherwise specifically prescribed herein. Notwithstanding the foregoing, for purposes of determining compliance with any covenant (including the computation of any financial covenant) contained herein, Indebtedness of the Borrower and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof, and the effects of FASB ASC 825 on financial liabilities shall be disregarded.

 

(b) Changes in GAAP.  If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents 

 

  

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required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

 

1.04 Rounding.  Any financial ratios required to be maintained by the Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

 

1.05 Times of Day.  Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

 

1.06 Letter of Credit Amounts.  Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

 

ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS

 

2.01 Committed Loans.  Subject to the terms and conditions set forth herein, each Lender severally agrees to make loans (each such loan, a “Committed Loan”) to the Borrower from time to time, on any Business Day during the Availability Period, in an aggregate amount not to exceed at any time outstanding the amount of such Lender’s Commitment; provided, however, that after giving effect to any Committed Borrowing, (i) the Total Outstandings shall not exceed the Maximum Availability, and (ii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations, plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment.  Within the limits of each Lender’s Commitment, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.01, prepay under Section 2.06, and reborrow under this Section 2.01.  Committed Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided herein.

 

2.02 Borrowings, Conversions and Continuations of Committed Loans.

 

(a) Each Committed Borrowing, each conversion of Committed Loans from one Type to the other, and each continuation of Eurodollar Rate Committed Loans shall be made upon the Borrower’s irrevocable notice to the Administrative Agent, which may be given by telephone.  Each such notice must be received by the Administrative Agent not later than 11:00 a.m. (i) three Business Days prior to the requested date of any Borrowing of, conversion to or continuation of Eurodollar Rate Committed Loans or of any conversion of Eurodollar Rate Committed Loans to Base Rate Committed Loans, and (ii) on the requested date of any Borrowing of Base Rate Committed Loans.  Each telephonic notice by the Borrower pursuant to 

 

  

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this Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a written Committed Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower.  Each Borrowing of, conversion to or continuation of Eurodollar Rate Committed Loans shall be in a principal amount of $2,000,000 or a whole multiple of $500,000 in excess thereof.  Except as provided in Sections 2.04(c) and 2.05(c), each Borrowing of or conversion to Base Rate Committed Loans shall be in a principal amount of $100,000 or a whole multiple of $100,000 in excess thereof.  Each Committed Loan Notice (whether telephonic or written) shall specify (i) whether the Borrower is requesting a Committed Borrowing, a conversion of Committed Loans from one Type to the other, or a continuation of Eurodollar Rate Committed Loans, (ii) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Committed Loans to be borrowed, converted or continued, (iv) the Type of Committed Loans to be borrowed or to which existing Committed Loans are to be converted, and (v) if applicable, the duration of the Interest Period with respect thereto.  If the Borrower fails to specify a Type of Committed Loan in a Committed Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Committed Loans shall be made as, or converted to, Base Rate Loans.  Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurodollar Rate Committed Loans.  If the Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Committed Loans in any such Committed Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.

 

(b) Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly notify each Lender of the amount of its Applicable Percentage of the applicable Committed Loans, and if no timely notice of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Loans described in the preceding subsection.  In the case of a Committed Borrowing, each Lender shall make the amount of its Committed Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m. on the Business Day specified in the applicable Committed Loan Notice.  Upon satisfaction of the applicable conditions set forth in Section 5.02 (and, if such Borrowing is the initial Credit Extension, Section 5.01), the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent on the requested date of Borrowing as set forth in Committed Loan Notice either by (i) crediting the account of the Borrower on the books of Bank of America with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower; provided, however, that if, on the date the Committed Loan Notice with respect to such Borrowing is given by the Borrower, there are L/C Borrowings outstanding, then the proceeds of such Borrowing, first, shall be applied to the payment in full of any such L/C Borrowings, and second, shall be made available to the Borrower as provided above.

 

(c) Except as otherwise provided herein, a Eurodollar Rate Committed Loan may be continued or converted only on the last day of an Interest Period for such Eurodollar Rate Committed Loan.  During the existence of a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Committed Loans without the consent of the Required Lenders.

 

  

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(d) The Administrative Agent shall promptly notify the Borrower and the Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Committed Loans upon determination of such interest rate.  At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify the Borrower and the Lenders of any change in Bank of America’s prime rate used in determining the Base Rate promptly following the public announcement of such change.

 

(e) After giving effect to all Committed Borrowings, all conversions of Committed Loans from one Type to the other, and all continuations of Committed Loans as the same Type, there shall not be more than six (6) Interest Periods in effect with respect to Committed Loans.

 

2.03 Intentionally Omitted.

 

2.04 Letters of Credit.

 

(a) The Letter of Credit Commitment.

 

(i) Subject to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in reliance upon the agreements of the Lenders set forth in this Section 2.04, (1) from time to time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit for the account of the Borrower, and to amend or extend Letters of Credit previously issued by it, in accordance with subsection (b) below, and (2) to honor drawings under the Letters of Credit; and (B) the Lenders severally agree to participate in Letters of Credit issued for the account of the Borrower and any drawings thereunder; provided that after giving effect to any L/C Credit Extension with respect to any Letter of Credit, (x) the Total Outstandings shall not exceed the Maximum Availability, (y) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations, plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment, and (z) the Outstanding Amount of the L/C Obligations shall not exceed the Letter of Credit Sublimit.  Each request by the Borrower for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by the Borrower that the L/C Credit Extension so requested complies with the conditions set forth in the proviso to the preceding sentence.  Within the foregoing limits, and subject to the terms and conditions hereof, the Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.  All Existing Letters of Credit shall be deemed to have been issued pursuant hereto, and from and after the Closing Date shall be subject to and governed by the terms and conditions hereof.

 

(ii) The L/C Issuer shall not issue any Letter of Credit, if:

 

(A) except as otherwise provided in Section 2.04(b)(iii) the expiry date of the requested Letter of Credit would occur more than twelve months after the date of issuance, unless the Required Lenders have approved such expiry date; or

 

 

  

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(B) the expiry date of the requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless all the Lenders have approved such expiry date.

 

(iii) The L/C Issuer shall not be under any obligation to issue any Letter of Credit if:

 

(A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the L/C Issuer from issuing the Letter of Credit, or any Law applicable to the L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the L/C Issuer shall prohibit, or request that the L/C Issuer refrain from, the issuance of letters of credit generally or the Letter of Credit in particular or shall impose upon the L/C Issuer with respect to the Letter of Credit any restriction, reserve or capital requirement (for which the L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the L/C Issuer in good faith deems material to it;

 

 

 

(B) the issuance of the Letter of Credit would violate one or more policies of the L/C Issuer applicable to letters of credit generally;

 

(C) the Letter of Credit is to be denominated in a currency other than Dollars;

 

(D) any Lender is at that time a Defaulting Lender, unless the L/C Issuer has entered into arrangements, including the delivery of Cash Collateral, satisfactory to the L/C Issuer (in its sole discretion) with the Borrower or such Lender to eliminate the L/C Issuer’s actual or potential Fronting Exposure (after giving effect to Section 2.18(a)(iv)) with respect to the Defaulting Lender arising from either the Letter of Credit then proposed to be issued or that Letter of Credit and all other L/C Obligations as to which the L/C Issuer has actual or potential Fronting Exposure, as it may elect in its sole discretion, or

 

(E) the Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing thereunder.

 

(iv) The L/C Issuer shall not amend any Letter of Credit if the L/C Issuer would not be permitted at such time to issue the Letter of Credit in its amended form under the terms hereof.

 

(v) The L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) the L/C Issuer would have no obligation at such time to issue the Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of the Letter of Credit does not accept the proposed amendment to the Letter of Credit.

 

  

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(vi) The L/C Issuer shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and the L/C Issuer shall have all of the benefits and immunities (A) provided to the Administrative Agent in Article X with respect to any acts taken or omissions suffered by the L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in Article X included the L/C Issuer with respect to such acts or omissions, and (B) as additionally provided herein with respect to the L/C Issuer.

 

(b) Procedures for Issuance and Amendment of Letters of Credit.

 

(i) Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Borrower delivered to the L/C Issuer (with a copy to the Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officer of the Borrower.  Such Letter of Credit Application must be received by the L/C Issuer and the Administrative Agent not later than 11:00 a.m. at least two Business Days (or such later date and time as the Administrative Agent and the L/C Issuer may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be.  In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to the L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; (G) the purpose and nature of the requested Letter of Credit; and (H) such other matters as the L/C Issuer may require.  In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to the L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date of amendment thereof (which shall be a Business Day); (C) the nature of the proposed amendment; and (D) such other matters as the L/C Issuer may require.  Additionally, the Borrower shall furnish to the L/C Issuer and the Administrative Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, including any Issuer Documents, as the L/C Issuer or the Administrative Agent may require.

 

(ii) Promptly after receipt of any Letter of Credit Application, the L/C Issuer will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit Application from the Borrower and, if not, the L/C Issuer will provide the Administrative Agent with a copy thereof.  Unless the L/C Issuer has received written notice from any Lender, the Administrative Agent or any Loan Party, at least one Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Article V shall not then be satisfied, then, subject to the terms and conditions hereof, the L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the Borrower or enter into the applicable amendment, as the case may be, in each case in accordance with the L/C Issuer’s usual and customary

 

 

  

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        business practices.  Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Letter

        of Credit.

 

(iii) If the Borrower so requests in any applicable Letter of Credit Application, the L/C Issuer shall issue a Letter of Credit that has automatic extension provisions (each, an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension Letter of Credit must permit the L/C Issuer to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “Non-Extension Notice Date”) in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued.  Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) the L/C Issuer to permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date; provided, however, that the L/C Issuer shall not permit any such extension if an Event of Default is continuing hereunder.

 

(iv) Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, the L/C Issuer will also deliver to the Borrower and the Administrative Agent a true and complete copy of such Letter of Credit or amendment.

 

(c) Drawings and Reimbursements; Funding of Participations.

 

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the L/C Issuer shall notify the Borrower and the Administrative Agent thereof.  Not later than 11:00 a.m. on the date of any payment by the L/C Issuer under a Letter of Credit (each such date, an “Honor Date”), the Borrower shall reimburse the L/C Issuer through the Administrative Agent in an amount equal to the amount of such drawing.  If the Borrower fails to so reimburse the L/C Issuer by such time, the Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such Lender’s Applicable Percentage thereof.  In such event, the Borrower shall be deemed to have requested a Committed Borrowing of Base Rate Loans to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02 for the principal amount of Base Rate Loans, but subject to the amount of the unutilized portion of the Aggregate Commitments and the conditions set forth in Section 5.02 (other than the delivery of a Committed Loan Notice).  Any notice given by the L/C Issuer or the Administrative Agent pursuant to this Section 2.04(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

 

(ii) Each Lender shall upon any notice pursuant to Section 2.04(c)(i) make funds available (and the Administrative Agent may apply Cash Collateral provided for 

 

 

  

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this purpose) for the account of the L/C Issuer at the Administrative Agent’s Office in an amount equal to its Applicable Percentage of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Administrative Agent, whereupon, subject to the provisions of Section 2.04(c)(iii), each Lender that so makes funds available shall be deemed to have made a Base Rate Committed Loan to the Borrower in such amount.  The Administrative Agent shall remit the funds so received to the L/C Issuer.

 

(iii) With respect to any Unreimbursed Amount that is not fully refinanced by a Committed Borrowing of Base Rate Loans because the conditions set forth in Section 5.02 cannot be satisfied or for any other reason, the Borrower shall be deemed to have incurred from the L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the Default Rate.  In such event, each Lender’s payment to the Administrative Agent for the account of the L/C Issuer pursuant to Section 2.04(c)(ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 2.04.

 

(iv) Until each Lender funds its Committed Loan or L/C Advance pursuant to this Section 2.04(c) to reimburse the L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Applicable Percentage of such amount shall be solely for the account of the L/C Issuer.

 

(v) Each Lender’s obligation to make Committed Loans or L/C Advances to reimburse the L/C Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.04(c), shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the L/C Issuer, the Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Committed Loans pursuant to this Section 2.04(c) is subject to the conditions set forth in Section 5.02 (other than delivery by the Borrower of a Committed Loan Notice).  No such making of an L/C Advance shall relieve or otherwise impair the obligation of the Borrower to reimburse the L/C Issuer for the amount of any payment made by the L/C Issuer under any Letter of Credit, together with interest as provided herein.

 

(vi) If any Lender fails to make available to the Administrative Agent for the account of the L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.04(c) by the time specified in Section 2.04(c)(ii), then, without limiting the other provisions of this Agreement, the L/C Issuer shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the L/C Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the L/C Issuer in accordance with banking industry rules on interbank compensation, plus

 

  

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        any administrative, processing or similar fees customarily charged by the L/C Issuer in connection with the foregoing.  If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Committed Loan included in the relevant Committed Borrowing or L/C Advance in respect of the

        relevant L/C Borrowing, as the case may be.  A certificate of the L/C Issuer submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (vi) shall be conclusive absent manifest error.

 

(d) Repayment of Participations.

 

(i) At any time after the L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.04(c), if the Administrative Agent receives for the account of the L/C Issuer any payment in respect of the related Unreimbursed Amount or interest thereon (whether directly from the Borrower or otherwise, including proceeds of Cash Collateral applied thereto by the Administrative Agent), the Administrative Agent will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by the Administrative Agent.

 

(ii) If any payment received by the Administrative Agent for the account of the L/C Issuer pursuant to Section 2.04(c)(i) is required to be returned under any of the circumstances described in Section 11.05 (including pursuant to any settlement entered into by the L/C Issuer in its discretion), each Lender shall pay to the Administrative Agent for the account of the L/C Issuer its Applicable Percentage thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at a rate per annum equal to the Federal Funds Rate from time to time in effect.  The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

 

(e) Obligations Absolute. The obligation of the Borrower to reimburse the L/C Issuer for each drawing under each Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

 

(i) any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document;

 

(ii) the existence of any claim, counterclaim, setoff, defense or other right that the Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the L/C Issuer or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

 

(iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the 

 

 

  

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        transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

 

(iv) any payment by the L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by the L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

 

(v) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower or any Subsidiary.

 

The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the Borrower’s instructions or other irregularity, the Borrower will immediately notify the L/C Issuer.  The Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and its correspondents unless such notice is given as aforesaid.  Notwithstanding the foregoing, the Borrower shall not be precluded from asserting any claim for direct damages suffered by the Borrower in determining whether a request presented under any Letter of Credit issued by it complied with the terms of such Letter of Credit, provided any  liability of the L/C Issuer shall be subject to the determination by a court of competent jurisdiction by final and nonappealable judgment that such direct damages resulted from the gross negligence or willful misconduct of the L/C Issuer.

 

(f) Role of L/C Issuer. Each Lender and the Borrower agree that, in paying any drawing under a Letter of Credit, the L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document.  None of the L/C Issuer, the Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of the L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document.  The Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude the Borrower’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement.  None of the L/C Issuer, the Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of the L/C Issuer shall be liable or responsible for any of the matters described in clauses (i) through (v) of Section 2.04(e); provided, however, that anything in such clauses to the contrary notwithstanding, the Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be liable to the Borrower, to the extent, but only to the extent, of any direct, as opposed to 

 

  

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consequential or exemplary, damages suffered by the Borrower which the Borrower proves were caused by the L/C Issuer’s willful misconduct or gross negligence or the L/C Issuer’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of Credit.  In furtherance and not in limitation of the foregoing, the L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

 

(g) Applicability of ISP and UCP. Unless otherwise expressly agreed by the L/C Issuer and the Borrower when a Letter of Credit is issued (including any such agreement applicable to an Existing Letter of Credit), the rules of the ISP shall apply to each standby Letter of Credit.

 

(h) Letter of Credit Fees.  The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage a Letter of Credit fee (the “Letter of Credit Fee”) for each Letter of Credit equal to the Applicable Rate for Eurodollar Rate Committed Loans times the daily amount available to be drawn under such Letter of Credit; provided, however, any Letter of Credit Fees otherwise payable for the account of a Defaulting Lender with respect to any Letter of Credit as to which such Defaulting Lender has not provided Cash Collateral satisfactory to the L/C Issuer pursuant to this Section 2.04 shall be payable, to the maximum extent permitted by applicable Law, to the other Lenders in accordance with the upward adjustments in their respective Applicable Percentages allocable to such Letter of Credit pursuant to Section 2.18(a)(iv), with the balance of such fee, if any, payable to the L/C Issuer for its own account.  For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.06.  Letter of Credit Fees shall be (i) due and payable on the first Business Day after the end of each March, June, September and December, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand and (ii) computed on a quarterly basis in arrears.  If there is any change in the Applicable Rate during any quarter, the daily amount available to be drawn under each Letter of Credit shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect.  Notwithstanding anything to the contrary contained herein, upon the request of the Required Lenders, while any Event of Default exists, all Letter of Credit Fees shall accrue at the Default Rate.

 

(i) Documentary and Processing Charges Payable to L/C Issuer. The Borrower shall pay directly to the L/C Issuer for its own account the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of the L/C Issuer relating to letters of credit as from time to time in effect.  Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

 

(j) Conflict with Issuer Documents.  In the event of any conflict between the terms hereof and the terms of any Issuer Document, the terms hereof shall control.

 

 

  

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2.05 Swing Line Loans.

 

(a) The Swing Line.  Subject to the terms and conditions set forth herein, the Swing Line Lender, in reliance upon the agreements of the other Lenders set forth in this Section 2.05, may in its sole discretion make loans (each such loan, a “Swing Line Loan”) to the Borrower from time to time on any Business Day during the Availability Period in an aggregate amount not to exceed at any time outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans, when aggregated with the Applicable Percentage of the Outstanding Amount of Committed Loans and L/C Obligations of the Lender acting as Swing Line Lender, may exceed the amount of such Lender’s Commitment; provided, however, that after giving effect to any Swing Line Loan, (i) the Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations, plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment, and provided, further, that the Borrower shall not use the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan.  Within the foregoing limits, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.05, prepay under Section 2.06, and reborrow under this Section 2.05.  Each Swing Line Loan shall be a Base Rate Loan.  Immediately upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Swing Line Loan.

 

(b) Borrowing Procedures.  Each Swing Line Borrowing shall be made upon the Borrower’s irrevocable notice to the Swing Line Lender and the Administrative Agent, which may be given by telephone.  Each such notice must be received by the Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum of $100,000, and (ii) the requested borrowing date, which shall be a Business Day.  Each such telephonic notice must be confirmed promptly by delivery to the Swing Line Lender and the Administrative Agent of a written Swing Line Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower.  Promptly after receipt by the Swing Line Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has also received such Swing Line Loan Notice and, if not, the Swing Line Lender will notify the Administrative Agent (by telephone or in writing) of the contents thereof.  Unless the Swing Line Lender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing the Swing Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the first proviso to the first sentence of Section 2.05(a), or (B) that one or more of the applicable conditions specified in Article V is not then satisfied, then, subject to the terms and conditions hereof, the Swing Line Lender will, not later than 3:00 p.m. on the borrowing date specified in such Swing Line Loan Notice, make the amount of its Swing Line Loan available to the Borrower at its office by crediting the account of the Borrower on the books of the Swing Line Lender in immediately available funds.  If such notice is received after 1:00 p.m. on the requested borrowing date, then the Swing Line Lender shall use best efforts to make the amount of its Swing Line Loan

 

  

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available to the Borrower by 10:00 a.m. on the following Business Day, to be disbursed in the manner set forth above.

 

(c) Refinancing of Swing Line Loans.

 

(i) The Swing Line Lender at any time in its sole discretion may request, on behalf of the Borrower (which hereby irrevocably authorizes the Swing Line Lender to so request on its behalf), that each Lender make a Base Rate Committed Loan in an amount equal to such Lender’s Applicable Percentage of the amount of Swing Line Loans then outstanding.  Such request shall be made in writing (which written request shall be deemed to be a Committed Loan Notice for purposes hereof) and in accordance with the requirements of Section 2.02, without regard to the minimum and multiples specified therein for the principal amount of Base Rate Loans, but subject to the unutilized portion of the Aggregate Commitments and the conditions set forth in Section 5.02.  The Swing Line Lender shall furnish the Borrower with a copy of the applicable Committed Loan Notice promptly after delivering such notice to the Administrative Agent.  Each Lender shall make an amount equal to its Applicable Percentage of the amount specified in such Committed Loan Notice available to the Administrative Agent in immediately available funds (and the Administrative Agent may apply Cash Collateral available with respect to the applicable Swing Line Loan) for the account of the Swing Line Lender at the Administrative Agent’s Office not later than 1:00 p.m. on the day specified in such Committed Loan Notice, whereupon, subject to Section 2.05(c)(ii), each Lender that so makes funds available shall be deemed to have made a Base Rate Committed Loan to the Borrower in such amount.  The Administrative Agent shall remit the funds so received to the Swing Line Lender.

 

(ii) If for any reason any Swing Line Loan cannot be refinanced by such a Committed Borrowing in accordance with Section 2.05(c)(i), the request for Base Rate Committed Loans submitted by the Swing Line Lender as set forth herein shall be deemed to be a request by the Swing Line Lender that each of the Lenders fund its risk participation in the relevant Swing Line Loan and each Lender’s payment to the Administrative Agent for the account of the Swing Line Lender pursuant to Section 2.05(c)(i) shall be deemed payment in respect of such participation.

 

(iii) If any Lender fails to make available to the Administrative Agent for the account of the Swing Line Lender any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.05(c) by the time specified in Section 2.05(c)(i), the Swing Line Lender shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the Swing Line Lender at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the Swing Line Lender in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the Swing Line Lender in connection with the foregoing.  If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Committed Loan included in the relevant Committed Borrowing or funded participation in the relevant 

 

  

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        Swing Line Loan, as the case may be.  A certificate of the Swing Line Lender submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error.

 

(iv) Each Lender’s obligation to make Committed Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this Section 2.05(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the Swing Line Lender, the Borrower or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Committed Loans pursuant to this Section 2.05(c) is subject to the conditions set forth in Section 5.02.  No such funding of risk participations shall relieve or otherwise impair the obligation of the Borrower to repay Swing Line Loans, together with interest as provided herein.

 

(d) Repayment of Participations.

 

(i) At any time after any Lender has purchased and funded a risk participation in a Swing Line Loan, if the Swing Line Lender receives any payment on account of such Swing Line Loan, the Swing Line Lender will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by the Swing Line Lender.

 

(ii) If any payment received by the Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by the Swing Line Lender under any of the circumstances described in Section 11.05 (including pursuant to any settlement entered into by the Swing Line Lender in its discretion), each Lender shall pay to the Swing Line Lender its Applicable Percentage thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned, at a rate per annum equal to the Federal Funds Rate.  The Administrative Agent will make such demand upon the request of the Swing Line Lender.  The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

 

(e) Interest for Account of Swing Line Lender.  The Swing Line Lender shall be responsible for invoicing the Borrower for interest on the Swing Line Loans.  Until each Lender funds its Base Rate Committed Loan or risk participation pursuant to this Section 2.05 to refinance such Lender’s Applicable Percentage of any Swing Line Loan, interest in respect of such Applicable Percentage shall be solely for the account of the Swing Line Lender.

 

(f) Payments Directly to Swing Line Lender.  The Borrower shall make all payments of principal and interest in respect of the Swing Line Loans directly to the Swing Line Lender.

 

2.06 Prepayments.

 

(a) The Borrower may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay Committed Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Administrative Agent not later than 

 

  

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11:00 a.m. (A) three Business Days prior to any date of prepayment of Eurodollar Rate Committed Loans and (B) on the date of prepayment of Base Rate Committed Loans; (ii) any prepayment of Eurodollar Rate Committed Loans shall be in a principal amount of $2,000,000 or a whole multiple of $500,000 in excess thereof; and (iii) any prepayment of Base Rate Committed Loans shall be in a principal amount of $100,000 or a whole multiple of $100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then outstanding.  Each such notice shall specify the date and amount of such prepayment and the Type(s) of Committed Loans to be prepaid and, if Eurodollar Rate Committed Loans are to be prepaid, the Interest Period(s) of such Loans.  The Administrative Agent will promptly notify each Lender of its receipt of each such notice, and of the amount of such Lender’s Applicable Percentage of such prepayment.  Unless Borrower revokes such notice at least one (1) Business Day prior to the specified prepayment date, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein.  Any prepayment of a Eurodollar Rate Loan shall be accompanied by all accrued interest on the amount prepaid, together with any additional amounts required pursuant to Section 3.05.  Subject to Section 2.18, each such prepayment shall be applied to the Committed Loans of the Lenders in accordance with their respective Applicable Percentages.

 

(b) The Borrower may, upon notice to the Swing Line Lender (with a copy to the Administrative Agent), at any time or from time to time, voluntarily prepay Swing Line Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the date of the prepayment, and (ii) any such prepayment shall be in a minimum principal amount of $100,000.  Each such notice shall specify the date and amount of such prepayment.  If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein.

 

(c) If for any reason the Total Outstandings at any time exceed the Maximum Availability then in effect, the Borrower shall within three (3) Business Days after notice from the Administrative Agent prepay Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such excess; provided, however, that the Borrower shall not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.06(c) unless after the prepayment in full of the Committed Loans and Swing Line Loans the Total Outstandings exceed the Maximum Availability then in effect.

 

2.07 Termination or Reduction of Commitments. The Borrower may, upon notice to the Administrative Agent, terminate the Aggregate Commitments, or from time to time permanently reduce the Aggregate Commitments; provided that (i) any such notice shall be received by the Administrative Agent not later than 11:00 a.m. five Business Days prior to the date of termination or reduction, provided, however, the Borrower may revoke such notice prior to the scheduled date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of $10,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the Borrower shall not terminate or reduce the Aggregate Commitments if, after giving effect thereto and to any concurrent prepayments hereunder, the Total Outstandings would exceed the Aggregate Commitments, and (iv) if, after giving effect to any reduction of the Aggregate Commitments, the Letter of Credit Sublimit or the Swing Line Sublimit exceeds the amount of the Aggregate Commitments, such Sublimit shall be automatically reduced by the amount of

 

  

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such excess.  The Administrative Agent will promptly notify the Lenders of any such notice of termination or reduction of the Aggregate Commitments.  Any reduction of the Aggregate Commitments shall be applied to the Commitment of each Lender according to its Applicable Percentage.  All fees accrued until the effective date of any termination of the Aggregate Commitments shall be paid on the effective date of such termination.

 

2.08 Repayment of Loans.

 

(a) The Borrower shall repay to the Lenders on the Maturity Date the aggregate principal amount of Committed Loans outstanding on such date.

 

(b) The Borrower shall repay each Swing Line Loan on the earlier to occur of (i) the date five (5) Business Days after such Loan is made and (ii) the Maturity Date.

 

2.09 Interest.

 

(a) Subject to the provisions of subsection (b) below, (i) each Eurodollar Rate Committed Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; (ii) each Base Rate Committed Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate; and (iii) each Swing Line Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate.

 

(b) (i)           If any amount of principal of any Loan is not paid when due (subject to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

(ii) If any amount (other than principal of any Loan) payable by the Borrower under any Loan Document is not paid when due (subject to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, then upon the request of the Required Lenders, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

(iii) While any Event of Default exists pursuant to Section 9.01(a)(i) or (f), the Borrower shall pay interest on the principal amount of all outstanding Obligations hereunder at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

(iv) Upon the request of the Required Lenders, while any other Event of Default exists, the Borrower shall pay interest on the principal amount of all outstanding Obligations hereunder at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

  

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(v) Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.

 

(c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein.  Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.

 

2.10 Fees.  In addition to certain fees described in subsections (h) and (i) of Section 2.04:

 

(a) Unused Fee. The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage, an unused fee equal to the applicable Unused Rate times the actual daily amount by which the Aggregate Commitments exceed the sum of (i) the Outstanding Amount of Committed Loans and (ii) the Outstanding Amount of L/C Obligations, subject to adjustment as provided in Section 2.18.  The unused fee shall accrue at all times during the Availability Period, including at any time during which one or more of the conditions in Article V is not met, and shall be due and payable quarterly in arrears on the last Business Day of each March, June, September and December, commencing with the first such date to occur after the Closing Date, and on the last day of the Availability Period.  The unused fee shall be calculated quarterly in arrears, and if there is any change in the Daily Usage during any quarter, the actual daily amount shall be computed and multiplied by the Unused Rate separately for each period during such quarter that such Unused Rate was in effect.

 

(b) Other Fees. (i) The Borrower shall pay to the Arranger, the Lenders and the Administrative Agent for their own respective accounts fees in the amounts and at the times specified in the Fee Letter.  Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

 

(ii) The Borrower shall pay to the Lenders such fees as shall have been separately agreed upon in writing in the amounts and at the times so specified.  Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

 

2.11 Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate.

 

(a)           All computations of interest for Base Rate Loans (including Base Rate Loans determined by reference to the Eurodollar Rate) shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed.  All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year).  Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.13(a), bear interest for one day.  Each determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error.

 

  

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(b)           If, as a result of any restatement of or other adjustment to the financial statements of the Borrower or for any other reason, the Borrower or the Lenders determine that (i) the Leverage Ratio as calculated by the Borrower as of any applicable date was inaccurate and (ii) a proper calculation of the Leverage Ratio would have resulted in higher pricing for such period, the Borrower shall immediately and retroactively be obligated to pay to the Administrative Agent for the account of the applicable Lenders or the L/C Issuer, as the case may be, promptly on demand by the Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, automatically and without further action by the Administrative Agent, any Lender or the L/C Issuer), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period.  This paragraph shall not limit the rights of the Administrative Agent, any Lender or the L/C Issuer, as the case may be, under Section 2.04(c)(iii), 2.04(h) or 2.09(b) or under Article IX.  The Borrower’s obligations under this paragraph shall survive the termination of the Aggregate Commitments and the repayment of all other Obligations hereunder.

 

2.12 Evidence of Debt.

 

(a) The Credit Extensions made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and by the Administrative Agent in the ordinary course of business.  The accounts or records maintained by the Administrative Agent and each Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made by the Lenders to the Borrower and the interest and payments thereon.  Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations.  In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.  Upon the request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a Note, which shall evidence such Lender’s Loans in addition to such accounts or records.  Each Lender may attach schedules to its Note and endorse thereon the date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto.

 

(b) In addition to the accounts and records referred to in subsection (a), each Lender and the Administrative Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans.  In the event of any conflict between the accounts and records maintained by the Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.

 

2.13 Payments Generally; Administrative Agent’s Clawback.

 

(a) General.  All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff.  Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the

 

  

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Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date specified herein.  The Administrative Agent will promptly distribute to each Lender its Applicable Percentage (or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s Lending Office.  All payments received by the Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue.  If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.

 

(b) (i)  Funding by Lenders; Presumption by Administrative Agent.  Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Committed Borrowing of Eurodollar Rate Loans (or, in the case of any Committed Borrowing of Base Rate Loans, prior to 12:00 noon on the date of such Committed Borrowing) that such Lender will not make available to the Administrative Agent such Lender’s share of such Committed Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.02 (or, in the case of a Committed Borrowing of Base Rate Loans, that such Lender has made such share available in accordance with and at the time required by Section 2.02) and may, in reliance upon such assumption, make available to the Borrower a corresponding amount.  In such event, if a Lender has not in fact made its share of the applicable Committed Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount in immediately available funds with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate Loans.  If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period.  If such Lender pays its share of the applicable Committed Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Committed Loan included in such Committed Borrowing.  Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

 

(ii) Payments by Borrower; Presumptions by Administrative Agent.  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 or the L/C Issuer 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 or the L/C Issuer, as the case may be, the amount due.  In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the L/C Issuer,

 

  

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        as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or the L/C Issuer, in immediately available funds 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.

 

A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing under this subsection (b) shall be conclusive, absent manifest error.

 

(c) Failure to Satisfy Conditions Precedent.  If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this Article II, and such funds are not made available to the Borrower by the Administrative Agent because the conditions to the applicable Credit Extension set forth in Article V are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.

 

(d) Obligations of Lenders Several.  The obligations of the Lenders hereunder to make Committed Loans, to fund participations in Letters of Credit and Swing Line Loans and to make payments pursuant to Section 11.04(c) are several and not joint.  The failure of any Lender to make any Committed Loan, to fund any such participation or to make any payment under Section 11.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Committed Loan, to purchase its participation or to make its payment under Section 11.04(c).

 

(e) Funding Source.  Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

 

2.14 Sharing of Payments by Lenders.  If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of the Committed Loans made by it, or the participations in L/C Obligations or in Swing Line Loans held by it resulting in such Lender’s receiving payment of a proportion of the aggregate amount of such Committed Loans or participations and accrued interest thereon greater than its pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Committed Loans and subparticipations in L/C Obligations and Swing Line Loans of the other Lenders, or make such other adjustments as shall be equitable, 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 Committed Loans and other amounts owing them, provided that:

 

  

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(i) if any such participations or subparticipations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations or subparticipations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

 

(ii) the provisions of this Section shall not be construed to apply to (x) any payment made by or on behalf of the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender), (y) the application of Cash Collateral provided for in Section 2.17, or (z) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Committed Loans or subparticipations in L/C Obligations or Swing Line Loans to any assignee or participant, other than an assignment to the Borrower or any Subsidiary thereof (as to which the provisions of this Section shall apply).

 

Each Loan Party 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 such Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of such participation.

 

2.15 Extension of Maturity Date.   Subject to the provisions of this Section 2.15, the Borrower shall have the option to extend the Maturity Date then in effect hereunder (the “Existing Maturity Date”), for an additional one (1) year from the Existing Maturity Date (the “Extension Option”), subject to the satisfaction of each of the following conditions:

 

(a) At least thirty (30) days and not more than ninety (90) days prior to the Existing Maturity Date the Borrower shall notify the Administrative Agent of its exercise of the Extension Option;

 

(b) As of the date of the Borrower’s request to exercise the Extension Option and as of the Existing Maturity Date no Default shall have occurred and be continuing;

 

(c) the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party dated as of the Existing Maturity Date  signed by a Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such extension and (ii) in the case of the Borrower, certifying that, before and after giving effect to such extension, (A) the representations and warranties contained in Article VI and the other Loan Documents are true and correct in all material respects on and as of the Existing Maturity Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and except that for purposes of this Section 2.15, the representations and warranties contained in subsections (a) and (b) of Section 6.05 shall be deemed to refer to the most recent statements furnished pursuant to subsections (a) and (b), respectively, of Section 7.01, and (B) no Default exists;

 

  

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(d) No later than Existing Maturity Date the Borrower shall have paid to the Administrative Agent (for the pro rata benefit of the Lenders) an extension fee in the amount of 0.20% of the then Aggregate Commitments; and

 

(e) The Borrower shall have paid all reasonable out-of-pocket costs and expenses incurred by the Administrative Agent and all reasonable fees and expenses paid to third party consultants (including reasonable attorneys’ fees and expenses) incurred by the Administrative Agent in connection with such extension.

 

2.16 Increase in Commitments.

 

(a) Request for Increase.  Provided there exists no Default, upon notice to the Administrative Agent (which shall promptly notify the Lenders), the Administrative Agent and the Lenders agree that the Borrower may from time to time, request an increase by an amount (for all such requests) not exceeding $20,000,000 in the aggregate; provided that (i) any such request for an increase shall be in a minimum amount of $10,000,000, and (ii) the Borrower may make a maximum of two such requests.  At the time of sending such notice, the Borrower (in consultation with the Administrative Agent) shall specify the time period within which each Lender is requested to respond (which shall in no event be less than ten Business Days from the date of delivery of such notice to the Lenders).

 

(b) Lender Elections to Increase.  Each Lender shall notify the Administrative Agent within such time period whether or not it agrees to increase its Commitment and, if so, whether by an amount equal to, greater than, or less than its Applicable Percentage of such requested increase.  Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment.

 

(c) Notification by Administrative Agent; Additional Lenders.  The Administrative Agent shall notify the Borrower and each Lender of the Lenders’ responses to each request made hereunder.  To achieve the full amount of a requested increase and subject to the approval of the Administrative Agent, the L/C Issuer and the Swing Line Lender (which approvals shall not be unreasonably withheld), the Borrower may also invite additional Eligible Assignees to become Lenders pursuant to a joinder agreement in form and substance satisfactory to the Administrative Agent and its counsel.

 

(d) Effective Date and Allocations.  If the Aggregate Commitments are increased in accordance with this Section, the Administrative Agent and the Borrower shall determine the effective date (the “Increase Effective Date”) and the final allocation of such increase.  The Administrative Agent shall promptly notify the Borrower and the Lenders of the final allocation of such increase and the Increase Effective Date.

 

(e) Conditions to Effectiveness of Increase.  As a condition precedent to such increase, the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party dated as of the Increase Effective Date (in sufficient copies for each Lender) signed by a Responsible Officer of such Loan Party (x) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such increase, and (y) in the case of the Borrower, certifying that, before and after giving effect to such increase, (A) the representations and 

 

  

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warranties contained in Article V and the other Loan Documents are true and correct in all material respects on and as of the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and except that for purposes of this Section 2.16, the representations and warranties contained in subsections (a) and (b) of Section 6.05 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 7.01, and (B) no Default exists.  The Borrower shall prepay any Committed Loans outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to Section 3.05) to the extent necessary to keep the outstanding Committed Loans ratable with any revised Applicable Percentages arising from any nonratable increase in the Commitments under this Section.  Administrative Agent shall adjust the Applicable Percentages accordingly.

 

(f) Conflicting Provisions.  This Section shall supersede any provisions in Section 2.14 or 11.01 to the contrary.

 

2.17 Cash Collateral.

 

(a) Certain Credit Support Events.  Upon the request of the Administrative Agent or the L/C Issuer (i) if the L/C Issuer has honored any full or partial drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing and a Committed Borrowing has not been made in accordance with Section 2.04(c)(i), or (ii) if, as of the Letter of Credit Expiration Date, any L/C Obligation for any reason remains outstanding, the Borrower shall, in each case, immediately Cash Collateralize the then Outstanding Amount of all L/C Obligations.  At any time that there shall exist a Defaulting Lender, immediately upon the request of the Administrative Agent, the L/C Issuer or the Swing Line Lender, the Borrower shall deliver to the Administrative Agent Cash Collateral in an amount sufficient to cover all Fronting Exposure (after giving effect to Section 2.18(a)(iv) and any Cash Collateral provided by the Defaulting Lender).

 

(b) Grant of Security Interest.  All Cash Collateral (other than credit support not constituting funds subject to deposit) shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America.  The Borrower, and to the extent provided by any Lender, such Lender, hereby grants to (and subjects to the control of) the Administrative Agent, for the benefit of the Administrative Agent, the L/C Issuer and the Lenders (including the Swing Line Lender), and agrees to maintain, a first priority security interest in all such cash, deposit accounts and all balances therein, and all other property so provided as collateral pursuant hereto, and in all proceeds of the foregoing, all as security for the obligations to which such Cash Collateral may be applied pursuant to Section 2.17(c).  If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent as herein provided, or that the total amount of such Cash Collateral is less than the applicable Fronting Exposure and other obligations secured thereby, the Borrower will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency.

 

(c) Application. Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under any of this Section 2.17 or Sections 2.04, 2.05, 2.06, 

 

  

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2.18 or 9.02 in respect of Letters of Credit or Swing Line Loans shall be held and applied to the satisfaction of the specific L/C Obligations, Swing Line Loans, obligations to fund participations therein (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) and other obligations for which the Cash Collateral was so provided, prior to any other application of such property as may be provided for herein.

 

(d) Release.  Cash Collateral (or the appropriate portion thereof) provided to reduce Fronting Exposure or other obligations shall be released or reduced promptly following (i) the elimination or reduction of the applicable Fronting Exposure or other obligations giving rise thereto (including by the termination of Defaulting Lender status of the applicable Lender (or, as appropriate, its assignee following compliance with Section 11.06(b)(vi))) or (ii) the Administrative Agent’s good faith determination that there exists excess Cash Collateral; provided, however, (x) that Cash Collateral furnished by or on behalf of a Loan Party shall not be released during the continuance of a Default or Event of Default (and following application as provided in this Section 2.17 may be otherwise applied in accordance with Section 9.03), and (y) the Person providing Cash Collateral and the L/C Issuer or Swing Line Lender, as applicable, may agree that Cash Collateral shall not be released but instead held to support future anticipated Fronting Exposure or other obligations.

 

2.18 Defaulting Lenders.

 

(a) Adjustments.  Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:

 

(i) Waivers and Amendments.  That Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in Section 11.01.

 

(ii) Reallocation of Payments.  Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of that Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article IX or otherwise, and including any amounts made available to the Administrative Agent by that Defaulting Lender pursuant to Section 11.08), shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by that Defaulting Lender to the L/C Issuer or Swing Line Lender hereunder; third, if so determined by the Administrative Agent or requested by the L/C Issuer or Swing Line

 

  

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        Lender, to be held as Cash Collateral for future funding obligations of that Defaulting Lender of any participation in any Swing Line Loan or Letter of Credit; fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which that Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a non-interest bearing deposit account and released in order to satisfy obligations of that Defaulting Lender to fund Loans under this Agreement; sixth, to the payment of any amounts owing to the Lenders, the L/C Issuer or Swing Line Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the L/C Issuer or Swing Line Lender against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to that Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or L/C Borrowings in respect of which that Defaulting Lender has not fully funded its appropriate share and (y) such Loans or L/C Borrowings were made at a time when the conditions set forth in Section 5.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Borrowings owed to, all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Borrowings owed to, that Defaulting Lender.  Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.18(a)(ii) shall be deemed paid to and redirected by that Defaulting Lender, and each Lender irrevocably consents hereto.

 

(iii) Certain Fees.  That Defaulting Lender (x) shall not be entitled to receive any unused fee pursuant to Section 2.10(a) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender) and the Borrower shall (A) be required to pay to each of the L/C Issuer and the Swing Line Lender, as applicable, the amount of such fee allocable to its Fronting Exposure arising from that Defaulting Lender and (B) not be required to pay the remaining amount of such fee that otherwise would have been required to have been paid to that Defaulting Lender) and (y) shall be limited in its right to receive Letter of Credit Fees as provided in Section 2.04(h).

 

(iv) Reallocation of Applicable Percentages to Reduce Fronting Exposure.  During any period in which there is a Defaulting Lender, for purposes of computing the amount of the obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit or Swing Line Loans pursuant to Sections 2.04 and 2.05, the “Applicable Percentage” of each non-Defaulting Lender shall be computed without giving effect to the Commitment of that Defaulting Lender; provided, that, (i) each such reallocation shall be given effect only if, at the date the applicable Lender becomes a Defaulting Lender, no Default or Event of Default exists; and (ii) the aggregate obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit and Swing Line Loans shall not exceed the positive difference, if any, of (1) the Commitment of that non-Defaulting Lender minus (2) the aggregate Outstanding Amount of the Committed Loans of that Lender.

 

(b) Defaulting Lender Cure. If the Borrower, the Administrative Agent, Swing Line Lender and the L/C Issuer agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any 

 

  

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conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Committed Loans and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held on a pro rata basis by the Lenders in accordance with their Applicable Percentages (without giving effect to Section 2.18(a)(iv)), whereupon that Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that 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 to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

 

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01 Taxes.

 

(a) Payments Free of Taxes; Obligation to Withhold; Payments on Account of Taxes.  (i) Any and all payments by or on account of any obligation of the Borrower hereunder or under any other Loan Document shall to the extent permitted by applicable Laws be made free and clear of and without reduction or withholding for any Taxes.  If, however, applicable Laws require the Borrower or the Administrative Agent to withhold or deduct any Tax, such Tax shall be withheld or deducted in accordance with such Laws as determined by the Borrower or the Administrative Agent, as the case may be, upon the basis of the information and documentation to be delivered pursuant to subsection (e) below.

 

(ii) If the Borrower or the Administrative Agent shall be required by the Code to withhold or deduct any Taxes, including both United States Federal backup withholding and withholding taxes, from any payment, then (A) the Administrative Agent shall withhold or make such deductions as are determined by the Administrative Agent to be required based upon the information and documentation it has received pursuant to subsection (e) below, (B) the Administrative Agent shall timely pay the full amount withheld or deducted to the relevant Governmental Authority in accordance with the Code, and (C) to the extent that the withholding or deduction is made on account of Indemnified Taxes or Other Taxes, the sum payable by the Borrower shall be increased as necessary so that after any required withholding or the making of all required deductions (including deductions applicable to additional sums payable under this Section) the Administrative Agent, Lender or L/C Issuer, as the case may be, receives an amount equal to the sum it would have received had no such withholding or deduction been made.

 

(b) Payment of Other Taxes by the Borrower.  Without limiting the provisions of subsection (a) above, the Borrower shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable Laws.

 

(c) Tax Indemnifications.  (i) Without limiting the provisions of subsection (a) or (b) above, the Borrower shall, and does hereby, indemnify the Administrative Agent, each Lender

 

  

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        and the L/C Issuer, and shall make payment in respect thereof within 10 days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) withheld or deducted by the Borrower or the Administrative Agent or paid by the Administrative Agent, such Lender or the L/C Issuer, as the case may be, 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.  The Borrower shall also, and does hereby, indemnify the Administrative Agent, and shall make payment in respect thereof within 10 days after demand therefor, for any amount which a Lender or the L/C Issuer for any reason fails to pay indefeasibly to the Administrative Agent as required by clause (ii) of this subsection.  A certificate as to the amount of any such payment or liability delivered to the Borrower by a Lender or the L/C Issuer (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender or the L/C Issuer, shall be conclusive absent manifest error.

 

(ii) Without limiting the provisions of subsection (a) or (b) above, each Lender and the L/C Issuer shall, and does hereby, indemnify the Borrower and the Administrative Agent, and shall make payment in respect thereof within 10 days after demand therefor, against any and all Taxes and any and all related losses, claims, liabilities, penalties, interest and expenses (including the fees, charges and disbursements of any counsel for the Borrower or the Administrative Agent) incurred by or asserted against the Borrower or the Administrative Agent by any Governmental Authority as a result of the failure by such Lender or the L/C Issuer, as the case may be, to deliver, or as a result of the inaccuracy, inadequacy or deficiency of, any documentation required to be delivered by such Lender or the L/C Issuer, as the case may be, to the Borrower or the Administrative Agent pursuant to subsection (e).  Each Lender and the L/C Issuer hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender or the L/C Issuer, as the case may be, under this Agreement or any other Loan Document against any amount due to the Administrative Agent under this clause (ii).  The agreements in this clause (ii) shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of, a Lender or the L/C Issuer, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all other Obligations.

 

(d) Evidence of Payments.  Upon request by the Borrower or the Administrative Agent, as the case may be, after any payment of Taxes by the Borrower or by the Administrative Agent to a Governmental Authority as provided in this Section 3.01, the Borrower shall deliver to the Administrative Agent or the Administrative Agent shall deliver to the Borrower, as the case may be, the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of any return required by Laws to report such payment or other evidence of such payment reasonably satisfactory to the Borrower or the Administrative Agent, as the case may be.

 

(e) Status of Lenders; Tax Documentation.  (i)  Each Lender shall deliver to the Borrower and to the Administrative Agent, at the time or times prescribed by applicable Laws or when reasonably requested by the Borrower or the Administrative Agent, such properly 

 

  

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completed and executed documentation prescribed by applicable Laws or by the taxing authorities of any jurisdiction and such other reasonably requested information as will permit the Borrower or the Administrative Agent, as the case may be, to determine (A) whether or not payments made hereunder or under any other Loan Document are subject to Taxes, (B) if applicable, the required rate of withholding or deduction, and (C) such Lender’s entitlement to any available exemption from, or reduction of, applicable Taxes in respect of all payments to be made to such Lender by the Borrower pursuant to this Agreement or otherwise to establish such Lender’s status for withholding tax purposes in the applicable jurisdiction.

 

(ii) Without limiting the generality of the foregoing, if the Borrower is resident for tax purposes in the United States,

 

(A) any Lender that is a “United States person” within the meaning of Section 7701(a)(30) of the Code shall deliver to the Borrower and the Administrative Agent executed originals of Internal Revenue Service Form W-9 or such other documentation or information prescribed by applicable Laws or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent, as the case may be, to determine whether or not such Lender is subject to backup withholding or information reporting requirements; and

 

(B) each Foreign Lender that is entitled under the Code or any applicable treaty to an exemption from or reduction of withholding tax with respect to payments hereunder or under any other Loan Document shall deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the request of the Borrower or the Administrative Agent, but only if such Foreign Lender is legally entitled to do so), whichever of the following is applicable:

 

(I)           executed originals of Internal Revenue Service Form W-8BEN claiming eligibility for benefits of an income tax treaty to which the United States is a party,

 

(II)           executed originals of Internal Revenue Service Form W-8ECI,

 

(III)           executed originals of Internal Revenue Service Form W-8IMY and all required supporting documentation,

 

(IV)           in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under section 881(c) of the Code, (x) a certificate to the effect that such Foreign Lender is not (A) a “bank” within the meaning of section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in section 

 

  

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                        881(c)(3)(C) of the Code and (y) executed originals of  Internal Revenue Service Form W-8BEN, or

 

(V)           executed originals of any other form prescribed by applicable Laws as a basis for claiming exemption from or a reduction in United States Federal withholding tax together with such supplementary documentation as may be prescribed by applicable Laws to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made.

 

(iii) Each Lender shall promptly (A) notify the Borrower and the Administrative Agent of any change in circumstances which would modify or render invalid any claimed exemption or reduction, and (B) take such steps as shall not be materially disadvantageous to it, in the reasonable judgment of such Lender, and as may be reasonably necessary (including the re-designation of its Lending Office) to avoid any requirement of applicable Laws of any jurisdiction that the Borrower or the Administrative Agent make any withholding or deduction for taxes from amounts payable to such Lender.

 

(f) Treatment of Certain Refunds.  Unless required by applicable Laws, at no time shall the Administrative Agent have any obligation to file for or otherwise pursue on behalf of a Lender or the L/C Issuer, or have any obligation to pay to any Lender or the L/C Issuer, any refund of Taxes withheld or deducted from funds paid for the account of such Lender or the L/C Issuer, as the case may be.  If the Administrative Agent, any Lender or the L/C Issuer determines, in its sole discretion, that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to this Section, it shall pay to the Borrower an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower under this Section with respect to the Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket expenses incurred by the Administrative Agent, such Lender or the L/C Issuer, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund), provided that the Borrower, upon the request of the Administrative Agent, such Lender or the L/C Issuer, agrees to repay the amount paid over to the Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Administrative Agent, such Lender or the L/C Issuer in the event the Administrative Agent, such Lender or the L/C Issuer is required to repay such refund to such Governmental Authority.  This subsection shall not be construed to require the Administrative Agent, any Lender or the L/C Issuer to make available its tax returns (or any other information relating to its taxes that it deems confidential) to the Borrower or any other Person.

 

3.02 Illegality. If any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Loans whose interest is determined by reference to the Eurodollar Rate, or to determine or charge interest rates based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, (i) any obligation of 

 

  

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such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Committed Loans to Eurodollar Rate Committed Loans shall be suspended, and (ii) if such notice asserts the illegality of such Lender making or maintaining Base Rate Loans the interest rate on which is determined by reference to the Eurodollar Rate component of the Base Rate, the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Eurodollar Rate component of the Base Rate, in each case until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist.  Upon receipt of such notice, (x) the Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans (the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Eurodollar Rate component of the Base Rate), either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar Rate Loans and (y) if such notice asserts the illegality of such Lender determining or charging interest rates based upon the Eurodollar Rate, the Administrative Agent shall during the period of such suspension compute the Base Rate applicable to such Lender without reference to the Eurodollar Rate component thereof until the Administrative Agent is advised in writing by such Lender that it is no longer illegal  for such Lender to determine or charge interest rates based upon the Eurodollar Rate.  Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted.

 

3.03 Inability to Determine Rates.  If the Required Lenders determine that for any reason in connection with any request for a Eurodollar Rate Loan or a conversion to or continuation thereof that (a) Dollar deposits are not being offered to banks in the London interbank Eurodollar market for the applicable amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and reasonable means do not exist for determining the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Committed Loan or in connection with an existing or proposed Base Rate Loan, or (c) the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Committed Loan does not adequately and fairly reflect the cost to such Lenders of funding such Loan, the Administrative Agent will promptly so notify the Borrower and each Lender.  Thereafter, (x) the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended, and (y) in the event of a determination described in the preceding sentence with respect to the Eurodollar Rate component of the Base Rate, the utilization of the Eurodollar Rate component in determining the Base Rate shall be suspended, in each case until the Administrative Agent (upon the instruction of the Required Lenders) revokes such notice.  Upon receipt of such notice, the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Committed Loans or, failing that, will be deemed to have converted such request into a request for a Committed Borrowing of Base Rate Loans in the amount specified therein.

 

3.04 Increased Costs; Reserves on Eurodollar Rate Loans.

 

(a) Increased Costs Generally.  If any Change in Law shall:

 

  

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(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement contemplated by Section 3.04(e)) or the L/C Issuer;

 

(ii) subject any Lender or the L/C Issuer to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any Eurodollar Rate Loan made by it, or change the basis of taxation of payments to such Lender or the L/C Issuer in respect thereof (except for Indemnified Taxes or Other Taxes covered by Section 3.01 and the imposition of, or any change in the rate of, any Excluded Tax payable by such Lender or the L/C Issuer); or

 

(iii) impose on any Lender or the L/C Issuer or the London interbank market any other condition, cost or expense affecting this Agreement or Eurodollar Rate Loans made by such Lender or any Letter of Credit or participation therein;

 

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Loan the interest on which is determined by reference to the Eurodollar Rate (or of maintaining its obligation to make any such Loan), or to increase the cost to such Lender or the L/C Issuer of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or the L/C Issuer hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or the L/C Issuer, the Borrower will pay to such Lender or the L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or the L/C Issuer, as the case may be, for such additional costs incurred or reduction suffered.

 

(b) Capital Requirements.  If any Lender or the L/C Issuer determines that any Change in Law affecting such Lender or the L/C Issuer or any Lending Office of such Lender or such Lender’s or the L/C Issuer’s holding company, if any, regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s or the L/C Issuer’s capital or on the capital of such Lender’s or the L/C Issuer’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the L/C Issuer, to a level below that which such Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or the L/C Issuer’s policies and the policies of such Lender’s or the L/C Issuer’s holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender or the L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s holding company for any such reduction suffered.

 

(c) Certificates for Reimbursement.  A certificate of a Lender or the L/C Issuer setting forth the amount or amounts necessary to compensate such Lender or the L/C Issuer or its holding company, as the case may be, as specified in subsection (a) or (b) of this Section and delivered to the Borrower shall be conclusive absent manifest error.  The Borrower shall pay 

 

  

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such Lender or the L/C Issuer, as the case may be, the amount shown as due on any such certificate within 10 days after receipt thereof.

 

(d) Delay in Requests.  Failure or delay on the part of any Lender or the L/C Issuer to demand compensation pursuant to the foregoing provisions of this Section shall not constitute a waiver of such Lender’s or the L/C Issuer’s right to demand such compensation, provided that the Borrower shall not be required to compensate a Lender or the L/C Issuer pursuant to the foregoing provisions of this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Lender or the L/C Issuer, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or the L/C Issuer’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).

 

(e) Reserves on Eurodollar Rate Loans.  The Borrower shall pay to each Lender, as long as such Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional interest on the unpaid principal amount of each Eurodollar Rate Loan equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive), which shall be due and payable on each date on which interest is payable on such Loan, provided the Borrower shall have received at least 10 days’ prior notice (with a copy to the Administrative Agent) of such additional interest from such Lender.  If a Lender fails to give notice 10 days prior to the relevant Interest Payment Date, such additional interest shall be due and payable 10 days from receipt of such notice.

 

3.05 Compensation for Losses.  Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:

 

(a) any continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

 

(b) any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Borrower; or

 

(c) any assignment of a Eurodollar Rate Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower pursuant to Section 11.13;

 

including any loss of anticipated profits and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained.  The Borrower shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

 

For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurodollar Rate Committed Loan made

 

  

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by it at the Eurodollar Rate for such Loan by a matching deposit or other borrowing in the London interbank Eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Committed Loan was in fact so funded.

 

3.06 Mitigation Obligations; Replacement of Lenders.

 

(a) Designation of a Different Lending Office.  If any Lender requests compensation under Section 3.04, or the Borrower is required to pay any additional amount to any Lender, the L/C Issuer, or any Governmental Authority for the account of any Lender or the L/C Issuer pursuant to Section 3.01, or if any Lender gives a notice pursuant to Section 3.02, then such Lender or the L/C Issuer shall, as applicable, 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 judgment of such Lender or the L/C Issuer, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable, and (ii) in each case, would not subject such Lender or the L/C Issuer, as the case may be, to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender or the L/C Issuer, as the case may be.  The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender or the L/C Issuer in connection with any such designation or assignment.

 

(b) Replacement of Lenders.  If any Lender requests compensation under Section 3.04, 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 3.01, the Borrower may replace such Lender in accordance with Section 11.13.

 

3.07 Survival.  All of the Borrower’s obligations under this Article III shall survive termination of the Aggregate Commitments, repayment of all other Obligations hereunder, and resignation of the Administrative Agent.

 

ARTICLE IV. Borrowing Base

 

4.01 Initial Borrowing Base.  As of the Closing Date, the Borrowing Base Availability shall be calculated based upon the inclusion of the Initial Borrowing Base Properties.

 

4.02 Changes in Borrowing Base Availability Calculation.  Each change in the Borrowing Base Availability shall be effective upon receipt of a new Borrowing Base Report pursuant to Section 7.02(b); provided that any increase in the Borrowing Base Availability reflected in such Borrowing Base Report shall not become effective until (a) the first (1st) Business Day following admission of any new Borrowing Base Property, if applicable and (b) the fifth (5th) Business Day following delivery of the new Borrowing Base Report in all other instances, and provided, further, that any change in the Borrowing Base Availability as a result of the admission of a Property into the Borrowing Base pursuant to Section 4.03 shall be effective upon the date that such Borrowing Base Property is admitted for calculation in the Borrowing Base Availability.

 

  

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4.03 Requests for Admission into Borrowing Base Availability.  Borrower shall provide Administrative Agent with a written request for a Property to be admitted as a Borrowing Base Property.  Such request shall be accompanied by the following information regarding such Property (the “Property Information”) including the following, in each case reasonably acceptable to Administrative Agent: (a) a general description of such Property’s location, market, and amenities; (b) a property description; (c) UCC searches related to the applicable Property Owner and the owners of the Equity Interests of such new Property Owner; (d) the documents and information with respect to such Property listed in Section 4.10; (e) a Borrowing Base Report setting forth in reasonable detail the calculations required to establish the amount of the Borrowing Base Availability with such Property included in the calculation of the Borrowing Base Availability; (f) a Compliance Certificate setting forth in reasonable detail the calculations required to show that the Loan Parties will be in compliance with the terms of this Agreement with the inclusion of such Property included the calculation of the Borrowing Base Availability; and (g) such other customary information reasonably requested by Administrative Agent as shall be necessary in order for Administrative Agent to determine whether such Property is eligible to be a Borrowing Base Property.

 

4.04 Eligibility.  In order for a Property to be eligible for inclusion in the calculation of the Borrowing Base Availability, such Property must be an Eligible Property.

 

4.05 Approval of Borrowing Base Properties.  Each Property shall be subject to Administrative Agent’s reasonable approval for inclusion in the calculation of the Borrowing Base Availability.  Administrative Agent hereby approves all Initial Borrowing Base Properties for inclusion in the calculation of the Borrowing Base Availability.

 

4.06 Liens on Borrowing Base Properties.  A Property shall not be included in the calculation of the Borrowing Base Availability until: any  Person that owns Equity Interests in (a) a Property Owner,  or (b) the general partner of each Property Owner that is a limited partnership, shall have executed and delivered (or caused to be executed and delivered) a Subsidiary Guaranty, and a Pledge Agreement covering such Equity Interests; and (b) Borrower shall have delivered to Administrative Agent all of the Property Information listed in Section 4.10.

 

4.07 Notice of Admission of New Borrowing Base Properties.  If, after the date of this Agreement, a Property meets all the requirements to be included in the calculation of the Borrowing Base Availability set forth in this ARTICLE IV, then Administrative Agent shall notify Borrower and Lenders in writing (a) that such Property is admitted for inclusion in the calculation of the Borrowing Base Availability, and (b) of any changes to the Borrowing Base Availability as a result of the inclusion of such Property in the calculation of the Borrowing Base Availability.

 

4.08 Release of Borrowing Base Property and Guarantor.  Upon the written request of Borrower in connection with a sale, refinancing or other permanent disposition, Administrative Agent shall release a Borrowing Base Property from the Borrowing Base Availability and any and all Liens in the Equity Interests of the applicable Property Owner or individually related to such Property Owner granted pursuant to the Security Documents, including the Mortgage Assignment with respect to such Borrowing Base Property, and, where 

 

  

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appropriate, release such Property Owner from the Subsidiary Guaranty; provided that (a) if at any time there are less than ten (10) Borrowing Base Properties (or after giving effect to any release, there would be less than ten (10) Borrowing Base Properties), the consent of the Required Lenders is obtained, and (b) no Default exists before and after giving effect thereto (other than Defaults solely with respect to such Borrowing Base Property that would no longer exist after giving effect to the release of such Borrowing Base Property from the Borrowing Base Availability); provided, further, that Administrative Agent shall have no obligation to release any such Liens or obligations without a Borrowing Base Report setting forth in reasonable detail the calculations required to establish the amount of the Borrowing Base Availability without such Borrowing Base Property and a Compliance Certificate setting forth in reasonable detail the calculations required to show that the Loan Parties are in compliance with the terms of this Agreement without the inclusion of such Borrowing Base Property in the calculation of the Borrowing Base Availability and the various financial covenants set forth herein, in each case as of the date of such release and after giving effect to any such release, and all representations and warranties set forth herein are true and accurate in all material respects at the time of such release and immediately after giving effect to such release, except to the extent that any such representation or warranty relates to a specific earlier date or to the Borrowing Base Property being removed from the Borrowing Base Availability. In addition, to the extent the Administrative Agent has received a Pledge Agreement with respect to any Property Owner which does not own, directly or indirectly, a Borrowing Base Property, provided no Default is then in existence, the Administrative Agent will release such Pledge Agreement upon the request of the Borrower.  Upon the written request of Borrower, Administrative Agent shall release a Subsidiary Guarantor that is not a Property Owner from the Subsidiary Guaranty if any lender of such Subsidiary Guarantor requests that the Subsidiary Guarantor be released from the Subsidiary Guaranty or prohibits the Subsidiary Guarantor from guaranteeing debt of another; provided that no Event of Default exists before and after giving effect thereto.

 

4.09 Exclusion Events.  Each of the following events shall be an “Exclusion Event” with respect to a Borrowing Base Property:

 

(a) such Borrowing Base Property suffers a Material Environmental Event after the date of this Agreement which the Administrative Agent determines, acting reasonably and in good faith, materially impairs the value or marketability of such Borrowing Base Property;

 

(b) Administrative Agent determines that such Borrowing Base Property has suffered a Material Property Event after the date such Property was included in the calculation of Borrowing Base Availability (or in the case of an uninsured Casualty, in respect of such Borrowing Base Property, is reasonably likely to become a Material Property Event) which the Administrative Agent determines, acting reasonably and in good faith, materially impairs the value or marketability of such Borrowing Base Property; and

 

(c) The Improvements have been damaged (ordinary wear and tear excepted) and not repaired or are the subject of any pending or, to any Loan Party’s knowledge, threatened Condemnation or adverse zoning proceeding, except as could not reasonably be expected to cause a Material Property Event.

 

  

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After the occurrence of any Exclusion Event, Administrative Agent, at the direction of Required Lenders in their sole discretion, shall have the right at any time and from time to time to notify Borrower (the “Exclusion Notice”) that, effective ten (10) Business Days after the giving of such notice and for so long as such circumstance exists, such Property shall no longer be considered a Borrowing Base Property for purposes of determining the Borrowing Base Availability.  Borrowing Base Properties which have been subject to an Exclusion Event may, at Borrower’s request, be released from the Borrowing Base Availability; provided that such release shall be subject to the conditions for release set forth in Section 4.08, except that the occurrence of such Exclusion Event shall not be taken into consideration for the purposes of calculating subsection (b) of the definition of Borrowing Base NOI or for the purposes of compliance with Section 8.10(e).

 

If Administrative Agent delivers an Exclusion Notice and such Exclusion Event no longer exists, then Borrower may give Administrative Agent written notice thereof (together with reasonably detailed evidence of the cure of such condition) and such Borrowing Base Property shall, effective with the delivery by Borrower of the next Borrowing Base Report, be considered a Borrowing Base Property for purposes of calculating the Borrowing Base Availability as long as such Borrowing Base Property meets all the requirements to be included in the Borrowing Base Availability set forth in this ARTICLE IV.  Any Property that is excluded from the Borrowing Base Availability pursuant to this Section 4.09 may subsequently be reinstated as a Borrowing Base Property, even if an Exclusion Event exists, upon such terms and conditions as Required Lenders may approve.

 

4.10 Documentation Required with Respect to Borrowing Base Properties.  Borrower shall deliver, or shall cause the applicable Property Owner to deliver, each of the following with respect to each Property to be included in the calculation of the Borrowing Base Availability:

 

(a) UCC-1 financing statements which shall have been furnished for filing in all filing offices that Administrative Agent may reasonably require with respect to any Equity Interest Collateral;

 

(b) Mortgage Assignments which shall have been furnished for filing in all filing offices that Administrative Agent may reasonably require with respect to the SunChamp Collateral;

 

(c) a true and correct rent roll for such Property; and

 

(d) all matters required to be delivered under the definition of Eligible Property.

 

ARTICLE V. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

5.01 Conditions of Initial Credit Extension.  The obligation of the L/C Issuer and each Lender to make its initial Credit Extension hereunder is subject to satisfaction of the following conditions precedent:

 

 

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(a) The Administrative Agent’s receipt of the following, each of which shall be originals or telecopies (followed promptly by originals) unless otherwise specified, each properly executed by a Responsible Officer of the signing Loan Party, each dated the Closing Date (or, in the case of certificates of governmental officials, a recent date before the Closing Date) and each in form and substance reasonably satisfactory to the Administrative Agent and each of the Lenders:

 

(i) executed counterparts of this Agreement and the Guaranty, sufficient in number for distribution to the Administrative Agent, each Lender and the Borrower;

 

(ii) a Note executed by the Borrower in favor of each Lender requesting a Note;

 

(iii) Pledge Agreements with respect to all Equity Interest Collateral;

 

(iv) Mortgage Assignments with respect to the SunChamp Collateral;

 

(v) such certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as the Administrative Agent may require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents to which such Loan Party is a party;

 

(vi) such documents and certifications as the Administrative Agent may reasonably require to evidence that each Loan Party is duly organized or formed, and that each of the Borrower and Guarantors is validly existing, in good standing and qualified to engage in business in each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect;

 

(vii) a favorable opinion of Jaffe, Raitt, Heuer and Weiss, P.C., counsel to the Loan Parties, addressed to the Administrative Agent and each Lender, as to the matters set forth in Exhibit F and such other matters concerning the Loan Parties and the Loan Documents as the Required Lenders may reasonably request;

 

(viii) a certificate of a Responsible Officer of each Loan Party either (A) attaching copies of all consents, licenses and approvals required in connection with the execution, delivery and performance by such Loan Party and the validity against such Loan Party of the Loan Documents to which it is a party, and such consents, licenses and approvals shall be in full force and effect, or (B) stating that no such consents, licenses or approvals are so required;

 

(ix) a certificate signed by a Responsible Officer of the Borrower certifying (A) that the conditions specified in Sections 5.02(a) and (b) have been satisfied, (B) that there has been no event or circumstance since the date of the Audited Financial Statements that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect; and (C) a calculation of the Leverage Ratio as of June 30, 2011;

 

  

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(x) a duly completed Compliance Certificate as of the last day of the fiscal quarter of the Borrower ended on June 30, 2011, signed by a Responsible Officer of the Borrower;

 

(xi) evidence that all insurance required to be maintained pursuant to the Loan Documents has been obtained and is in effect;

 

(xii) evidence that the Existing Credit Agreement has been or concurrently with the Closing Date is being terminated and all Liens securing obligations under the Existing Credit Agreement have been or concurrently with the Closing Date are being released; and

 

(xi)           such other assurances, certificates, documents, consents or opinions as the Administrative Agent, the L/C Issuer, the Swing Line Lender or the Required Lenders reasonably may require.

 

(b) Any fees required to be paid on or before the Closing Date shall have been paid.

 

(c) Unless waived by the Administrative Agent, the Borrower shall have paid all fees, charges and disbursements of counsel to the Administrative Agent (directly to such counsel if requested by the Administrative Agent) to the extent invoiced prior to or on the Closing Date, plus such additional amounts of such fees, charges and disbursements as shall constitute its reasonable estimate of such fees, charges and disbursements incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settling of accounts between the Borrower and the Administrative Agent).

 

Without limiting the generality of the provisions of the last paragraph of Section 10.03, for purposes of determining compliance with the conditions specified in this Section 5.01, each Lender that has signed this 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.

 

5.02 Conditions to all Credit Extensions.  The obligation of each Lender to honor any Request for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Committed Loans to the other Type, or a continuation of Eurodollar Rate Committed Loans) is subject to the following conditions precedent:

 

(a) The representations and warranties of the Borrower and each other Loan Party contained in Article VI or any other Loan Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be true and correct in all material respects on and as of the date of such Credit Extension, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct as of such earlier date, and except that for purposes of this Section 5.02, the representations and warranties contained in subsections (a) and (b) of Section 6.05 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 7.01.

 

  

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(b) No Default shall exist, or would result from such proposed Credit Extension or from the application of the proceeds thereof.

 

(c) The Administrative Agent and, if applicable, the L/C Issuer or the Swing Line Lender shall have received a Request for Credit Extension in accordance with the requirements hereof.

 

Each Request for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Committed Loans to the other Type or a continuation of Eurodollar Rate Committed Loans) submitted by the Borrower shall be deemed to be a representation and warranty that the conditions specified in Sections 5.02(a) and (b) have been satisfied on and as of the date of the applicable Credit Extension.

 

ARTICLE VI.  REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the Administrative Agent and the Lenders that:

 

6.01 Existence, Qualification and Power.  Each Loan Party (a) is duly organized or formed, validly existing and, as applicable, in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its assets and carry on its business and (ii) execute, deliver and perform its obligations under the Loan Documents to which it is a party, and (c) is duly qualified and is licensed and, as applicable, in good standing under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except in each case referred to in clause (b)(i) or (c), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

 

6.02 Authorization; No Contravention.  The execution, delivery and performance by each Loan Party of each Loan Document to which such Person is party, have been duly authorized by all necessary corporate or other organizational action, and do not and will not (a) contravene the terms of any of such Person’s Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (i) any Contractual Obligation to which such Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject; or (c) violate any Law.

 

6.03 Governmental Authorization; Other Consents.  No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, any Loan Party of this Agreement or any other Loan Document.

 

6.04 Binding Effect.  This Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by each Loan Party that is party thereto.  This Agreement constitutes, and each other Loan Document when so delivered

 

  

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will constitute, a legal, valid and binding obligation of such Loan Party, enforceable against each Loan Party that is party thereto in accordance with its terms.

 

6.05 Financial Statements; No Material Adverse Effect.  (a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii) fairly present the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all material indebtedness and other liabilities, direct or contingent, of the Borrower and its Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness.

 

(b) The unaudited consolidated balance sheets of the Parent and its Subsidiaries dated June 30, 2011, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for the fiscal quarter ended on that date (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein, and (ii) fairly present the financial condition of the Parent and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and to normal year-end audit adjustments.

 

(c) Since the date of the Audited Financial Statements, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect. Each of the Parent and  Borrower is Solvent, and each of the Loan Parties and the other Subsidiaries considered on a consolidated basis are Solvent.

 

6.06 Litigation. There are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of the Borrower after due and diligent investigation, threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against the Borrower or any of its Subsidiaries or against any of their properties or revenues that (a) purport to affect or pertain to this Agreement or any other Loan Document, or any of the transactions contemplated hereby, or (b) except as specifically disclosed in Schedule 6.06, either individually or in the aggregate, if determined adversely, could reasonably be expected to have a Material Adverse Effect, and there has been no material adverse change in the status, or financial effect on any Loan Party or any Subsidiary thereof, of the matters described on Schedule 6.06.

 

6.07 No Default.  Neither any Loan Party nor any Subsidiary thereof is in default under or with respect to any Contractual Obligation that could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  No Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any other Loan Document.

 

6.08 Ownership of Property; Liens.  Each of the Borrower and each Subsidiary has good record and marketable title in fee simple to, or valid leasehold interests in, all real property 

 

  

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necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  The property of the Borrower and its Subsidiaries is subject to no Liens, other than Liens permitted by Section 8.01.

 

6.09 Environmental Compliance.  The Borrower and its Subsidiaries conduct in the ordinary course of business a review of the effect of existing Environmental Laws and claims alleging potential liability or responsibility for violation of any Environmental Law on their respective businesses, operations and properties, and as a result thereof the Borrower has reasonably concluded that, except as specifically disclosed in Schedule 6.09, such Environmental Laws and claims could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

6.10 Insurance.  The properties of the Loan Parties are insured with insurance companies not Affiliates of the Borrower, which, to Borrower’s knowledge are financially sound and reputable, 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 the applicable Loan  Party operates.

 

6.11 Taxes.  The Borrower and its Subsidiaries have filed all Federal, state and other material tax returns and reports required to be filed, and have paid all Federal, state and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or assets otherwise due and payable, except those which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been provided in accordance with GAAP.  There is no proposed tax assessment against the Borrower or any Subsidiary that would, if made, have a Material Adverse Effect.

 

6.12 ERISA Compliance.  

 

(a) (a)           Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other Federal or state laws, other than any non-compliance that could not reasonably be expected to have a Material Adverse Effect.  Each Pension Plan that is intended to be a qualified plan under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service to the effect that the form of such Plan is qualified under Section 401(a) of the Code and the trust related thereto has been determined by the Internal Revenue Service to be exempt from federal income tax under Section 501(a) of the Code, or an application for such a letter is currently being processed by the Internal Revenue Service.  To the best knowledge of the Borrower, nothing has occurred that would prevent or cause the loss of such tax-qualified status.

 

(b) There are no pending or, to the best knowledge of the Borrower, threatened claims, actions or  lawsuits, or action by any Governmental Authority, with respect to any Plan that  could reasonably be expected to have a Material Adverse Effect.  There has been no prohibited transaction or violation of the fiduciary responsibility rules with respect to any Plan that has resulted or could reasonably be expected to result in a Material Adverse Effect.

 

  

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(c) (i) No ERISA Event has occurred, and neither the Borrower nor any ERISA Affiliate is aware of any fact, event or circumstance that could reasonably be expected to constitute or result in an ERISA Event with respect to any Pension Plan; (ii) the Borrower and each ERISA Affiliate has met all applicable requirements under the Pension Funding Rules in respect of each Pension Plan, and no waiver of the minimum funding standards under the Pension Funding Rules has been applied for or obtained; (iii) as of the most recent valuation date for any Pension Plan, the funding target attainment percentage (as defined in Section 430(d)(2) of the Code) is 60% or higher and neither the Borrower nor any ERISA Affiliate knows of any facts or circumstances that could reasonably be expected to cause the funding target attainment percentage for any such plan to drop below 60% as of the most recent valuation date; (iv) neither the Borrower nor any ERISA Affiliate has incurred any liability to the PBGC other than for the payment of premiums, and there are no premium payments which have become due that are unpaid; (v) neither the Borrower nor any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or Section 4212(c) of ERISA; and (vi) no Pension Plan has been terminated by the plan administrator thereof nor by the PBGC, and no event or circumstance has occurred or exists that could reasonably be expected to cause the PBGC to institute proceedings under Title IV of ERISA to terminate any Pension Plan.

 

6.13 Subsidiaries; Equity Interests.  The Parent and Borrower have no Subsidiaries other than those specifically disclosed in Schedule 6.13, and all of the outstanding Equity Interests in such Subsidiaries have been validly issued, are fully paid and nonassessable and are owned as set forth on Schedule 6.13 free and clear of all Liens (other than Liens in favor of Administrative Agent), and other than, with respect to Subsidiaries which do not own Equity Interests in any Property Owners, liens granted in connection with pledges of Equity Interests owned, directly or indirectly, by Subsidiaries who own Property subject to Non-Recourse Indebtedness and required by any lender of such Non-Recourse Indebtedness.  Neither Parent nor Borrower has any direct or indirect Equity Interests in any other Person other than those specifically disclosed in Schedule 6.13.

 

6.14 Margin Regulations; Investment Company Act.

 

(a) None of the Loan Parties is engaged nor will engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying margin stock.

 

(b) None of the Loan parties, any Person Controlling Borrower, or any other Loan Party is or is required to be registered as an “investment company” under the Investment Company Act of 1940.

 

6.15 Disclosure.  The Loan Parties have disclosed to the Administrative Agent and the Lenders all agreements, instruments and corporate or other restrictions to which it or any of their Subsidiaries is subject, and all other matters known to it, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.  No written report, financial statement, certificate or other information furnished by any Loan Party, or to Borrower’s knowledge, on behalf of any Loan Party to the Administrative Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or 

 

  

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delivered hereunder or under any other Loan Document (in each case, as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.

 

6.16 Compliance with Laws.  Each Loan Party and each Subsidiary thereof is in compliance in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

 

6.17 Taxpayer Identification Number.  Each Loan Party’s true and correct U.S. taxpayer identification number is set forth on Schedule 6.17.

 

ARTICLE VII.  AFFIRMATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the Loan Parties shall, and shall (except in the case of the covenants set forth in Sections 7.01, 7.02, and 7.03) cause each Subsidiary to:

 

7.01 Financial Statements.  Deliver to the Administrative Agent and each Lender, in form and detail as previously delivered to the Administrative Agent in connection with the origination of the Loans  or otherwise satisfactory to the Administrative Agent and the Required Lenders:

 

(a) as soon as available, but in any event within 90 days after the end of each fiscal year of the Parent, a consolidated balance sheet of the Parent and its Subsidiaries as at the end of such fiscal year, and the related consolidated statements of income or operations, changes in shareholders’ equity, and cash flows for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail and prepared in accordance with GAAP, such consolidated statements to be audited and accompanied by a report and opinion of an independent certified public accountant of recognized standing, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be subject to any “going concern” or like qualification or exception or any qualification or exception as to the scope of such audit; and

 

(b) as soon as available, but in any event within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Parent, a consolidated balance sheet of the Parent and its Subsidiaries as at the end of such fiscal quarter, the related consolidated statements of income or operations for such fiscal quarter and for the portion of the Parent’s fiscal year then ended, and the related consolidated statements of changes in shareholders’ equity, and cash flows for the portion of the Parent’s fiscal year then ended, in each case setting forth in comparative

 

  

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form, as applicable, the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the previous fiscal year, all in reasonable detail, such consolidated statements to be certified by the chief executive officer, chief financial officer, treasurer or controller of the Parent as fairly presenting the financial condition, results of operations, shareholders’ equity and cash flows of the Parent and its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes.

 

As to any information contained in materials furnished pursuant to Section 7.02 (d), the Parent shall not be separately required to furnish such information under clause (a) or (b) above, but the foregoing shall not be in derogation of the obligation of the Borrower to furnish the information and materials described in clauses (a) and (b) above at the times specified therein.

 

7.02 Certificates; Other Information.  Deliver to the Administrative Agent and each Lender, in form and detail satisfactory to the Administrative Agent and the Required Lenders:

 

(a) concurrently with the delivery of the financial statements referred to in Sections 7.01(a) and (b), a duly completed Compliance Certificate signed by the chief executive officer, chief financial officer, treasurer or controller of the Borrower (which delivery may, unless the Administrative Agent, or a Lender requests executed originals, be by electronic communication including fax or email and shall be deemed to be an original authentic counterpart thereof for all purposes);

 

(b) concurrently with the delivery of the financial statements referred to in Sections 7.01(a) and (b), upon the inclusion of a Property in the calculation of Borrowing Base Availability, and upon the removal of any Property from the calculation of Borrowing Base Availability, a duly completed Borrowing Base Report signed by the chief executive officer, chief financial officer, treasurer or controller of Borrower (which delivery may, unless Administrative Agent or a Lender requests executed originals, be by electronic communication including fax or email and shall be deemed to be an original authentic counterpart thereof for all purposes);

 

(c) promptly after any request by the Administrative Agent or any Lender, copies of any final management letters or recommendations submitted to the board of directors (or the audit committee of the board of directors) of the Borrower by independent accountants in connection with the accounts or books of the Parent or any Subsidiary, or any audit of any of them;

 

(d) promptly after the same are available, copies of each annual report, proxy or financial statement or other report or communication sent to the stockholders of the Parent, and copies of all annual, regular, periodic and special reports and registration statements which the Parent may file or be required to file with the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required to be delivered to the Administrative Agent pursuant hereto;

 

(e) as soon as reasonably practicable, but in any event within ninety (90) days after request by the Administrative Agent or any Lender, the annual budget then in effect for Borrower, on a consolidated basis prepared by Borrower in the ordinary course of its business

 

  

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provided, however, that the annual budget for the current year will not be available until February 28 of such year;

 

(f) promptly after the furnishing thereof, copies of any statement or report furnished to any holder of debt securities of Parent or Borrower pursuant to the terms of any indenture, loan or credit or similar agreement and not otherwise required to be furnished to the Lenders pursuant to Section 7.01 or any other clause of this Section 7.02;

 

(g) promptly, and in any event within five (5) Business Days after receipt thereof by Parent or Borrower, copies of each notice or other correspondence received from the SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any material investigation or other material inquiry by such agency regarding financial or other operational results of any Loan Party, other than routine comment letters from the SEC with respect to public filings unless restricted from doing so by such agency; and

 

(h)           promptly, such additional information regarding the business, financial or corporate affairs of Parent or Borrower or any Borrowing Base Property, or compliance with the terms of the Loan Documents, as Administrative Agent or any Lender may from time to time reasonably request.

 

Documents required to be delivered pursuant to Section 7.01(a) or (b) or Section 7.02(d) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which the Borrower posts such documents, or provides a link thereto on the Borrower’s website on the Internet at the website address listed on Schedule 11.02; or (ii) on which such documents are posted on the Borrower’s behalf on an Internet or intranet website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); provided that: (i) the Borrower shall deliver paper copies of such documents to the Administrative Agent or any Lender upon its request to the Borrower to deliver such paper copies until a written request to cease delivering paper copies is given by the Administrative Agent or such Lender and (ii) the Borrower shall notify the Administrative Agent and each Lender (by telecopier or electronic mail) of the posting of any such documents and provide to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such documents.  The Administrative Agent shall have no obligation to request the delivery of or to maintain paper copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by the Borrower with any such request by a Lender for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

 

Parent and Borrower hereby acknowledge that (a) Administrative Agent and/or the Lead Arranger will make available to the Lenders and L/C Issuer materials and/or information provided by or on behalf of Parent and Borrower hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on IntraLinks or another similar electronic system (the “Platform”) and (b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to receive material non-public information with respect to Parent, Borrower or their Affiliates, or the respective Equity Interests of any of the foregoing, and who may be engaged in 

 

  

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investment and other market-related activities with respect to such Persons’ Equity Interests.  Parent and Borrower hereby agree that (w) all Borrower Materials that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” Parent and Borrower shall be deemed to have authorized Administrative Agent, Lead Arranger, L/C Issuer and the Lenders to treat such Borrower Materials as not containing any material non-public information with respect to Parent and Borrower or their Equity Interests for purposes of United States Federal and state securities laws (provided that to the extent such Borrower Materials constitute Information, they shall be treated as set forth in Section 11.07); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Side Information;” and (z) Administrative Agent and the Lead Arranger shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Side Information.”

 

7.03 Notices.  Promptly notify the Administrative Agent and each Lender:

 

(a) of the occurrence of any Default;

 

(b) of any matter that has resulted or could reasonably be expected to result in a Material Adverse Effect, including (i) breach or non-performance of, or any default under, a Contractual Obligation of the Borrower or any Subsidiary; (ii) any dispute, litigation, investigation, proceeding or suspension between the Borrower or any Subsidiary and any Governmental Authority; or (iii) the commencement of, or any material development in, any litigation or proceeding affecting the Borrower or any Subsidiary, including pursuant to any applicable Environmental Laws;

 

(c) of the occurrence of any ERISA Event;

 

(d) of any material change in accounting policies or financial reporting practices by the Borrower or any Subsidiary;

 

(e) of any actual or threatened in writing condemnation of any portion of any Borrowing Base Property, and which could reasonably be expected to have a Material Adverse Effect;

 

(f) of any material permit, license, certificate or approval required with respect to any Borrowing Base Property lapses or ceases to be in full force and effect or claim from any person that any Borrowing Base Property, or any use, activity, operation or maintenance thereof or thereon, is not in compliance with any Law except to the extent that the same would not result in a Material Adverse Effect; and

 

(g) of any material change in accounting policies or financial reporting practices by any Loan Party.

 

Each notice pursuant to this Section 7.03 shall be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the occurrence referred to therein and stating what action the Borrower has taken and proposes to take with respect thereto.  Each 

 

  

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notice pursuant to Section 7.03(a) shall describe with particularity any and all provisions of this Agreement and any other Loan Document that have been breached.

 

7.04 Payment of Obligations.  Pay and discharge as the same shall become due and payable, all its obligations and liabilities, including (a) all tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Parent or such Subsidiary; (b) all lawful claims which, if unpaid, would by law become a Lien upon its property; and (c) all Indebtedness, as and when due and payable, but subject to any subordination provisions contained in any instrument or agreement evidencing such Indebtedness.

 

7.05 Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and effect its legal existence and good standing under the Laws of the jurisdiction of its organization except in a transaction permitted by Section 8.03 or 8.04; (b) take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; and (c) preserve or renew all of its registered patents, trademarks, trade names and service marks, the non-preservation of which could reasonably be expected to have a Material Adverse Effect.

 

7.06 Maintenance of Properties.  (a) Maintain, preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted; and (b) make all necessary repairs thereto and renewals and replacements thereof except where the failure to do so could not reasonably be expected to have a Material Adverse Effect.

 

7.07 Maintenance of Insurance.  Maintain with financially sound and reputable insurance companies not Affiliates of the Borrower, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business, of such types and in such amounts as are customarily carried under similar circumstances by such other Persons.

 

7.08 Compliance with Laws.  Comply in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted; or (b) the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.

 

7.09 Books and Records.  (a)  Maintain proper books of record and account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of the Borrower or such Subsidiary, as the case may be; and (b) maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over the Borrower or such Subsidiary, as the case may be.

 

  

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7.10 Inspection Rights.  Permit representatives and independent contractors of the Administrative Agent and each Lender to visit and inspect any of its properties, to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to discuss its affairs, finances and accounts with its designated officers, and independent public accountants, all at the expense of the Borrower and at such reasonable times during normal business hours and as often as may be reasonably desired, all upon at least 48 hours advance notice to the Borrower; provided, however, that when an Event of Default exists the Administrative Agent or any Lender (or any of their respective representatives or independent contractors) may do any of the foregoing at the expense of the Borrower at any time during normal business hours and without advance notice.

 

7.11 Use of Proceeds.  Use the proceeds of the Credit Extensions for general corporate purposes not in contravention of any Law or of any Loan Document.

 

7.12 Borrowing Base Properties.

 

Except where the failure to comply with any of the following would not have a Material Adverse Effect, each of Parent and Borrower shall, and shall use commercially reasonable efforts to cause each other Loan Party, to:

 

(a) Pay all real estate and personal property taxes, assessments, water rates or sewer rents, maintenance charges, impositions, and any other charges, including vault charges and license fees for the use of vaults, chutes and similar areas adjoining any Borrowing Base Property, now or hereafter levied or assessed or imposed against any Borrowing Base Property or any part thereof (except those which are being contested in good faith by appropriate proceedings diligently conducted).

 

(b) Promptly pay (or cause to be paid) before delinquent all bills and costs for labor, materials, and specifically fabricated materials incurred in connection with any Borrowing Base Property (except those which are being contested in good faith by appropriate proceedings diligently conducted), and in any event never permit to be created or exist in respect of any Borrowing Base Property or any part thereof any other or additional Lien or security interest other than Liens permitted by Section 8.01.

 

(c) Operate the Borrowing Base Properties in a good and workmanlike manner and in all material respects in accordance with all Laws in accordance with such Loan Party’s prudent business judgment.

 

(d) Cause each other Loan Party to, to the extent owned and controlled by a Loan Party, preserve, protect, renew, extend and retain all material rights and privileges granted for or applicable to each Borrowing Base Property.

 

Notwithstanding the foregoing, to the extent that any of the foregoing causes a Material Property Event with respect of any Borrowing Base Property, such event shall be an Exclusion Event pursuant to Section 4.09.

 

7.13 Subsidiary Guarantor Organizational Documents.  Each of Parent and Borrower shall, and shall cause each other Pledgor to, at its expense, maintain the Organization 

 

  

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Documents of each Subsidiary Guarantor in full force and effect, without any cancellation, termination, amendment, supplement, or other modification of such Organization Documents, except as explicitly required by their terms (as in effect on the date hereof), except for amendments, supplements, or other modifications that do not adversely affect the interests of the Lenders under the applicable Pledge Agreement in any material respect, and except for Organization Documents in respect of Equity Interests of partnerships or limited liability companies that have been released from the applicable Pledgor’s Pledge Agreement.

 

7.14 Additional Guarantors.  Notify the Administrative Agent at the time that any Person becomes a Significant Subsidiary (defined below), and promptly thereafter (and in any event within 30 days), cause such Person, to (a) become a Guarantor by executing and delivering to the Administrative Agent a counterpart of the Subsidiary Guaranty or such other document as the Administrative Agent shall deem appropriate for such purpose, and (b) deliver to the Administrative Agent documents of the types referred to in clauses (v) and (vi) of Section 5.01(a) and, at Administrative Agent’s request, favorable opinions of counsel to such Person (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation referred to in clause (a)), all in form, content and scope reasonably satisfactory to the Administrative Agent.  For purposes of this Section 7.14, “Significant Subsidiary” means any Subsidiary that: (x) owns a manufactured home and/or recreational vehicle community, or (y) has an asset value similar to that of Sun Home Services, Inc.

 

7.15 Environmental Matters.  Comply and cause each other Loan Party and each other Subsidiary to, comply with all Environmental Laws the failure with which to comply could reasonably be expected to have a Material Adverse Effect.  The Loan Parties shall use, and shall cause each other Subsidiary to use, commercially reasonable efforts to cause all other Persons occupying, using or present on the Properties to comply, with all Environmental Laws in all material respects.  The Loan Parties shall, and shall cause each other Subsidiary to, promptly take all actions and pay or arrange to pay all costs necessary for it and for the Properties to comply in all material respects with all Environmental Laws and all Governmental Approvals, including actions to remove and dispose of all Hazardous Materials and to clean up the Properties, each as required under Environmental Laws.  The Loan Parties shall, and shall cause each other Subsidiary to, promptly take all actions necessary to prevent the imposition of any Liens on any of their respective properties arising out of or related to any Environmental Laws.  Nothing in this Section shall impose any obligation or liability whatsoever on the Administrative Agent or any Lender.

 

7.16 REIT Status; New York Stock Exchange Listing.  The Parent shall at all times (i) maintain its status as a REIT, so long as REITs are recognized under the Code, and (ii) remain a publicly traded company listed on the New York Stock Exchange or another national stock exchange located in the United States.

 

ARTICLE VIII. NEGATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the Loan Parties shall not, nor shall it permit any Subsidiary to, directly or indirectly:

 

 

  

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8.01 Liens.  Create, incur, assume or suffer to exist any Lien upon any Collateral other than, with respect to the Borrowing Base Properties, the following:

 

(a) Liens pursuant to any Loan Document;

 

(b) Liens existing on the date hereof and listed on Schedule 8.01;

 

(c) Liens for taxes not yet delinquent or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP;

 

(d) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business which are not overdue for a period of more than 30 days or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the applicable Person;

 

(e) pledges or deposits in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other social security legislation, other than any Lien imposed by ERISA;

 

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

 

(g) easements, rights-of-way, restrictions and other similar encumbrances affecting real property, including easements to a governmental authority or utility company which, in the aggregate, are not substantial in amount, and which do not in any case materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of the applicable Person; and

 

(h) Liens securing judgments for the payment of money not constituting an Event of Default under Section 9.01(h).

 

8.02 Investments.  Make any Investments, except:

 

(a) Investments in the form of cash or cash equivalents;

 

(b) Investments existing on the date hereof and set forth on Schedule 6.13;

 

(c) advances to officers, directors and employees of the Borrower and Subsidiaries for travel, entertainment, relocation and analogous ordinary business purposes;

 

(d) Investments of the Guarantor and the Borrower in the form of Equity Interests and investments of the Borrower in any wholly-owned Subsidiary, and Investments of Borrower directly in, or of any wholly-owned Subsidiary in another wholly-owned Subsidiary which owns, real property assets which are located within the 

 

  

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        United States, provided in each case the Investments held by Borrower or Subsidiary are in accordance with the provisions of this Section 8.02 other than this Section 8.02(d);

 

(e) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business;

 

(f) Investments in unimproved land holdings not to at any time exceed ten percent (10%) of Total Asset Value;

 

(g) Investments in mortgages, mezzanine loans and notes receivable not exceeding 5% of Total Asset Value, provided, however, that loans and notes receivables from affiliates, and collateralized receivables shall not be subject to such 5% limitation (provided, however, collateralized receivables shall be subject to such limitations set forth in subsection (k) below);

 

(h) Investments in Construction in Progress not to at any time exceed ten percent (10%) of Total Asset Value;

 

(i) Investments in non-wholly owned Subsidiaries and Unconsolidated Affiliates not to at any time exceed ten percent (10%) of Total Asset Value;

 

(j) Investments in Real Property assets that are not manufactured home communities or recreation vehicle communities not to at any time exceed ten percent (10%) of Total Asset Value;

 

(k) Investments in collateralized receivables not to at any time exceed fifteen percent (15%) of Total Asset Value;

 

(l) Investments by the Parent for the redemption, conversion, exchange, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any Equity Interests of Parent or Borrower now or hereafter outstanding to the extent permitted under Section 8.05 below;

 

(m) Loans to employees, up to $500,000 in the aggregate;

 

(n) Investments in manufactured homes and recreational vehicles, including but not limited to the acquisition, sale, leasing and financing thereof; and

 

(o) Investments in other businesses or assets incidental to the operation of manufactured home communities or recreational vehicle communities, or related to the ownership, acquisition, operation, leasing or management of manufactured home communities or recreational vehicle communities..

 

Determinations of whether an Investment in an asset is permitted will be made after giving effect to the subject Investment.  Investments pursuant to clauses (f) through (j) above in the aggregate will not exceed 20% of Total Asset Value.

 

  

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8.03 Fundamental Changes.  Merge, dissolve, liquidate, consolidate with or into another Person, or Dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person, except that, so long as no Event of Default has occurred and is continuing or would result therefrom:

 

(a) any Loan Party (other Parent or Borrower) may merge with (i) Parent or Borrower, provided that Parent or Borrower, as applicable, shall be the continuing or surviving Person, or (ii) any other Loan Party, or (iii) any other Person provided that, if it owns a Borrowing Base Property and is not the surviving entity, then Borrower has complied with Section 4.08 to remove such Borrowing Base Property from the calculation of Borrowing Base Availability;

 

(b) any Loan Party (other than Parent or Borrower) may Dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise) to another Loan Party;

 

(c) any Loan Party may Dispose of a Property owned by such Loan Party in the ordinary course of business and for fair value; provided that if such Property is a Borrowing Base Property, then Borrower shall have complied with Section 4.08; and

 

(d) Parent or Borrower may merge or consolidate with another Person so long as either Parent or Borrower, as the case may be, is the surviving entity, shall remain in pro forma compliance with the covenants set forth in Section 8.14 below after giving effect to such transaction, and Borrower obtains the prior written consent in writing of the Required Lenders in their sole discretion.

 

Nothing in this Section shall be deemed to prohibit the sale or leasing of Property or portions of Property in the ordinary course of business.

 

8.04 Dispositions.  Make any Disposition or enter into any agreement to make any Disposition, except:

 

(a) Dispositions of obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business;

 

(b) Dispositions of inventory, manufactured homes and recreational vehicles in the ordinary course of business;

 

(c) Any other Dispositions of Properties or SunChamp Properties or other assets in an arm’s length transaction; provided that (i) if such property is a Borrowing Base Property, then Borrower shall have complied with Section 4.08 and (ii) the Borrower and the Parent will remain in pro forma compliance with the covenants set forth in Section 8.14 after giving effect to such transaction.

 

Nothing in this Section shall be deemed to prohibit the sale or leasing of Property or SunChamp Property or portions of Property or SunChamp Property in the ordinary course of business..

 

  

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8.05 Restricted Payments.  Declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except that:

 

(a) so long as no Default shall have occurred and be continuing at the time of any action described below or would result therefrom, each Subsidiary may make Restricted Payments to Borrower, and any other Person that owns an Equity Interest in Borrower or any such Subsidiary, ratably according to their respective holdings of the type of Equity Interest in respect of which such Restricted Payment is being made;

 

(b) so long as no Default shall have occurred and be continuing at the time of any action described below or would result therefrom, any Loan Party may declare and make dividend payments or other distributions payable with respect to the Equity Interests of such Loan Party solely in the common Equity Interests of such Loan Party including (i) “cashless exercises” of options granted under any share option plan adopted by Parent, (ii) distributions of rights or equity securities under any rights plan adopted by Borrower or Parent, and (iii) distributions (or effect stock splits or reverse stock splits) with respect to its Equity Interests payable solely in additional shares of its Equity Interests;

 

(c) so long as no Default shall have occurred and be continuing at the time of any action described below or would result therefrom, Borrower, Parent and each Subsidiary may purchase, redeem or otherwise acquire Equity Interests issued by it; and

 

(d) Borrower may make any Permitted Distributions, and Parent may distribute all proceeds received from such Permitted Distribution to any Person that owns an Equity Interest in Parent.

 

8.06 Change in Nature of Business.  Engage in any material line of business substantially different from those lines of business conducted by the Borrower and its Subsidiaries on the date hereof.

 

8.07 Transactions with Affiliates.  Enter into any transaction of any kind with any Affiliate that is not a Subsidiary of a Loan Party, whether or not in the ordinary course of business, other than on fair and reasonable terms substantially as favorable to such Loan Party as would be obtainable by such Loan Party at the time in a comparable arm’s length transaction with a Person other than an Affiliate.

 

8.08 Burdensome Agreements.  Enter into any Contractual Obligation (other than this Agreement or any other Loan Document) that (a) limits the ability (i) of any Subsidiary to make Restricted Payments to the Borrower or any Guarantor or to otherwise transfer property to the Borrower or any Guarantor, (ii) of any Subsidiary to Guarantee the Indebtedness of the Borrower or (iii) of the Borrower or any Subsidiary to create, incur, assume or suffer to exist Liens on any Borrowing Base Properties.

 

8.09 Use of Proceeds.  Use the proceeds of any Credit Extension, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the 

 

  

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purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose.

 

8.10 Borrowing Base Properties. Directly or indirectly:

 

(a) Use or occupy or conduct any activity on, or knowingly permit the use or occupancy of or the conduct of any activity on any Borrowing Base Properties by any tenant, in any manner which violates any Law or which constitutes a public or private nuisance in any manner which would have a Material Adverse Effect or which makes void, voidable, or cancelable any insurance then in force with respect thereto or makes the maintenance of insurance in accordance with Section 7.07 commercially unreasonable (including by way of increased premium);

 

(b) Without the prior written consent of Administrative Agent (which consent shall not be unreasonably withheld or delayed), initiate or permit any zoning reclassification of any Borrowing Base Property or use or knowingly permit the use of any Borrowing Base Property in such a manner which would result in such use becoming a nonconforming use under applicable zoning ordinances or other Laws to the extent that any of the foregoing would result in a Material Property Event;

 

(c) Without the prior written consent of Administrative Agent (which consent shall not be unreasonably withheld or delayed), (i) impose any restrictive covenant, or encumbrance upon any Borrowing Base Property, (ii) execute or file any subdivision plat or condominium declaration affecting any Borrowing Base Property, or (iii) consent to the annexation of any Borrowing Base Property to any municipality to the extent that any of the foregoing could reasonably be expected to result in a Material Property Event;

 

(d) Do any act, or suffer to be done any act by any Loan Party or any of its Affiliates, which would reasonably be expected to materially decrease the value of any Borrowing Base Property (including by way of negligent act); or

 

(e) Without the prior written consent of Required Lenders allow there to be less than ten (10) Borrowing Base Properties.

 

8.11 RESERVED.

 

8.12 RESERVED.

 

8.13 Negative Pledge; Indebtedness.  Not permit:

 

(a) Secured Recourse Indebtedness, other than the Credit Extensions, in excess of Three Hundred Million Dollars ($300,000,000) (solely to the extent of the recourse portion thereof), subject to a Two Hundred Million Dollars ($200,000,000) sublimit (solely to the extent of the recourse portion thereof) for collateralized receivables.

 

  

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(b) The incurrence of any Indebtedness (other than the Credit Extensions) secured by any Lien on any Borrowing Base Property, Equity Interest Collateral or SunChamp Collateral.

 

8.14 Financial Covenants.  Not, directly or indirectly, permit:

 

(a) Maximum Leverage Ratio.  Total Indebtedness to exceed seventy percent (70%) of Total Asset Value as of the last day of each fiscal quarter.

 

(b) Minimum Tangible Net Worth.  Tangible Net Worth at any time to be less than the sum of (i) eighty percent (80%) of the Tangible Net Worth on the Closing Date plus (ii) an amount equal to seventy-five percent (75%) of net equity proceeds received by the Parent after the Closing Date (other than proceeds received in connection with any dividend reinvestment program).

 

(c) Minimum Fixed Charge Coverage Ratio.  The ratio of Adjusted EBITDA to Fixed Charges at the end of any quarter to be less than 1.45 to 1.0 as of the last day of each fiscal quarter.

 

(d) Maximum Variable Rate Indebtedness.  More than thirty percent (30%) of Total Asset Value (with respect to which only the principal outstanding on the date of calculation shall be included) to accrue interest at a variable rate (exclusive of any variable rate interest obligation that is the subject of a Swap Contract).

 

(e) Restricted Payments.  The declaration or making, directly or indirectly, of any Restricted Payment, except as permitted under Section 8.05.

 

ARTICLE IX.  EVENTS OF DEFAULT AND REMEDIES

 

9.01 Events of Default.  Any of the following shall constitute an Event of Default:

 

(a) Non-Payment.  The Borrower or any other Loan Party fails to pay (i) when and as required to be paid herein, any amount of principal of any Loan or any L/C Obligation, or (ii) within three days after the same becomes due, any interest on any Loan or on any L/C Obligation, or any fee due hereunder, or (iii) within five days after the same becomes due, any other amount payable hereunder or under any other Loan Document; or

 

(b) Specific Covenants.  The Borrower fails to perform or observe any term, covenant or agreement contained in any of Section 7.01, 7.02, 7.03, 7.05, 7.10, 7.11 7.14 or 7.16 or Article VIII, or

 

(c) Other Defaults.  Any Loan Party fails to perform or observe any other covenant or agreement (not specified in subsection (a) or (b) above) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days, or such longer period of time as is reasonably necessary to cure such failure, provided that the Loan Party has commenced and is diligently prosecuting the cure of such failure and cures it within an additional 30 day period; or

 

  

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(d) Representations and Warranties.  Any representation, warranty, certification or statement of fact made or deemed made by or on behalf of the Borrower or any other Loan Party herein, in any other Loan Document, or in any document delivered in connection herewith or therewith shall be incorrect or misleading in any material respect when made or deemed made; or

 

(e) Cross-Default.  (i) The Borrower, the Parent or any Subsidiary (A) fails to make any payment prior to expiration of applicable grace or cure periods (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of any (a) Recourse Indebtedness (other than Indebtedness hereunder and Indebtedness under Swap Contracts) having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than $25,000,000 provided, however, any default by a debtor under any collateralized receivable shall not be deemed a default of Recourse Indebtedness, or (b) Non-Recourse Indebtedness having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than $100,000,000, provided that the failure to pay any such Indebtedness shall not constitute an Event of Default so long as the Borrower or its Subsidiaries is diligently contesting the payment of the same by appropriate legal proceedings and the Borrower or its Subsidiaries have set aside, in a manner and amount reasonably satisfactory to Administrative Agent, for the purpose of covering an adverse outcome, a sufficient reserve to repay accrued interest thereon and costs of enforcement, or (B) fails to observe or perform any other agreement or condition relating to any such Indebtedness or Guarantee or contained in any instrument or agreement evidencing, securing or relating thereto beyond any applicable cure period, or any other event occurs, the effect of which default or other event is to cause, or to permit the holder or holders of such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such Indebtedness to be demanded or to become due or to be repurchased, prepaid, defeased or redeemed (automatically or otherwise), or an offer to repurchase, prepay, defease or redeem such Indebtedness to be made, prior to its stated maturity, or such Guarantee to become payable or cash collateral in respect thereof to be demanded, provided that with respect to Non-Recourse Indebtedness the failure to observe or perform any other agreement or condition shall not constitute an Event of Default so long as the Borrower or its Subsidiaries is diligently contesting the same by appropriate legal proceedings and the Borrower or its Subsidiaries have set aside, in a manner and amount reasonably satisfactory to Administrative Agent, for the purpose of covering an adverse outcome, a sufficient reserve to repay accrued interest thereon and costs of enforcement; or (ii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of default and expiration of notice and grace periods under such Swap Contract as to which the Borrower or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which the Borrower or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by the Borrower or such Subsidiary as a result thereof is greater than $15,000,000; or

 

(f) Insolvency Proceedings, Etc.  Any Loan Party or any of its Subsidiaries institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an 

 

  

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assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law relating to any such Person or to all or any material part of its property is instituted without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or

 

(g) Inability to Pay Debts; Attachment.  (i) The Borrower or any Subsidiary becomes unable or admits in writing its inability or fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any material part of the property of any such Person and is not released, vacated or fully bonded within 30 days after its issue or levy; or

 

(h) Judgments.  There is entered against the Borrower or any Subsidiary (i) one or more final judgments or orders for the payment of money in an aggregate amount (as to all such judgments or orders) exceeding $5,000,000 (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage), or (ii) any one or more non-monetary final judgments that have, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect and, in either case, (A) enforcement proceedings are commenced by any creditor upon such judgment or order, or (B) there is a period of 30 consecutive days during which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, is not in effect; or

 

(i) RESERVED; or

 

(j) Invalidity of Loan Documents.  Any provision of any material Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect; or any Loan Party or any other Person contests in any manner the validity or enforceability of any provision of any Loan Document; or any Loan Party denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any provision of any Loan Document; or

 

(k) Change of Control.  There occurs any Change of Control.

 

(l) REIT Status of Parent.  Parent ceases to be treated as a REIT so long as REITs are recognized under the Code.

 

9.02 Remedies Upon Event of Default.  If any Event of Default occurs and is continuing, the Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders, take any or all of the following actions:

 

(a) declare the commitment of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such commitments and obligation shall be terminated;

 

  

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(b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower;

 

(c) require that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof); and

 

(d) exercise on behalf of itself, the Lenders and the L/C Issuer all rights and remedies available to it, the Lenders and the L/C Issuer under the Loan Documents;

 

provided, however, that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the obligation of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, and the obligation of the Borrower to Cash Collateralize the L/C Obligations as aforesaid shall automatically become effective, in each case without further act of the Administrative Agent or any Lender.

 

9.03 Application of Funds.  After the exercise of remedies provided for in Section 9.02 (or after the Loans have automatically become immediately due and payable and the L/C Obligations have automatically been required to be Cash Collateralized as set forth in the proviso to Section 9.02), any amounts received on account of the Obligations shall, subject to the provisions of Sections 2.17 and 2.18, be applied by the Administrative Agent in the following order:

 

First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to the Administrative Agent and amounts payable under Article III) payable to the Administrative Agent in its capacity as such;

 

Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal, interest and Letter of Credit Fees) payable to the Lenders and the L/C Issuer (including fees, charges and disbursements of counsel to the respective Lenders and the L/C Issuer and amounts payable under Article III), ratably among them in proportion to the respective amounts described in this clause Second payable to them;

 

Third, to payment of that portion of the Obligations constituting accrued and unpaid Letter of Credit Fees and interest on the Loans, L/C Borrowings and other Obligations, ratably among the Lenders and the L/C Issuer in proportion to the respective amounts described in this clause Third payable to them;

 

Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans and L/C Borrowings, ratably among the Lenders and the L/C Issuer in proportion to the respective amounts described in this clause Fourth held by them;

 

  

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Fifth, to the Administrative Agent for the account of the L/C Issuer, to Cash Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of Letters of Credit to the extent not otherwise Cash Collateralized by the Borrower pursuant to Sections 2.04 and 2.17; and

 

Last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Borrower or as otherwise required by Law.

 

Subject to Sections 2.04(c) and 2.17, amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit pursuant to clause Fifth above shall be applied to satisfy drawings under such Letters of Credit as they occur.  If any amount remains on deposit as Cash Collateral after all Letters of Credit have either been fully drawn or expired, such remaining amount shall be applied to the other Obligations, if any, in the order set forth above.

 

ARTICLE X. ADMINISTRATIVE AGENT

 

10.01 Appointment and Authority.  Each of the Lenders and the L/C Issuer hereby irrevocably appoints Bank of America to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, and to take any and all other actions as permitted pursuant to the term of this Agreement, together with such actions and powers as are reasonably incidental thereto.  The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the L/C Issuer, and neither the Borrower nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions.

 

10.02 Rights as a Lender.  The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity.  Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

 

10.03 Exculpatory Provisions.  The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents.  Without limiting the generality of the foregoing, the Administrative Agent:

 

(a)           shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

 

(b)           shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan 

 

  

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        Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law; and

 

(c)           shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Parent or any of its Affiliates that is communicated to or obtained by the Person serving as 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 (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 11.01 and 9.02) or (ii) in the absence of its own gross negligence or willful misconduct.  The Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given to the Administrative Agent by the Borrower, a Lender or the L/C Issuer.

 

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 this Agreement or any other 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 or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article V or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

 

10.04 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, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person.  The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the L/C Issuer, the Administrative Agent may presume that such condition is satisfactory to such Lender or the L/C Issuer unless the Administrative Agent shall have received notice to the contrary from such Lender or the L/C Issuer prior to the making of such Loan or the issuance of such Letter of Credit.  The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent 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 any such counsel, accountants or experts.

 

  

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10.05 Delegation of Duties.  The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent.  The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties.  The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, 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.

 

10.06 Resignation of Administrative Agent.  The Administrative Agent may at any time give notice of its resignation to the Lenders, the L/C Issuer and the Borrower.  Upon receipt of any such notice of resignation, the Required Lenders shall have the right to appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States, and, so long as no Event of Default has occurred and is continuing, such successor to be subject to the approval of the Borrower (each such consent not to be unreasonably withheld or delayed).  If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may on behalf of the Lenders and the L/C Issuer, appoint a successor Administrative Agent meeting the qualifications set forth above; provided that if the Administrative Agent shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (1) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents and (2) all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and the L/C Issuer directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section.  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents  (if not already discharged therefrom as provided above in this Section).  The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor.  After the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article and Section 11.04 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.

 

(b)           Any resignation by Bank of America as Administrative Agent pursuant to this Section shall also constitute its resignation as L/C Issuer and Swing Line Lender.  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer and Swing Line Lender, (b) the retiring L/C Issuer and Swing Line Lender shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (c) the successor L/C Issuer shall issue letters of credit in \

 

  

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substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring L/C Issuer to effectively assume the obligations of the retiring L/C Issuer with respect to such Letters of Credit.

 

10.07 Non-Reliance on Administrative Agent and Other Lenders.  Each Lender and the L/C Issuer acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties 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 Lender and the L/C Issuer also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

 

10.08 No Other Duties, Etc.  Anything herein to the contrary notwithstanding, none of the Bookrunners, Arrangers or Syndication Agent listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, a Lender or the L/C Issuer hereunder.

 

10.09 Administrative Agent May File Proofs of Claim.  In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation 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

 

(a)           to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations 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, the L/C Issuer and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the L/C Issuer and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders, the L/C Issuer and the Administrative Agent under Sections 2.04(i) and (j), 2.10 and 11.04) allowed in such judicial proceeding; and

 

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

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and the L/C Issuer to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders and the L/C Issuer, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements 

 

  

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and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.10 and 11.04.

 

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 L/C Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or the L/C Issuer to authorize the Administrative Agent to vote in respect of the claim of any Lender or the L/C Issuer in any such proceeding.

 

10.10 Collateral and Guaranty Matters.  The Lenders and the L/C Issuer irrevocably authorize the Administrative Agent, at its option and in its discretion,

 

(a)           to release any Lien on any property granted to or held by the Administrative Agent under any Loan Document (i) upon termination of the Aggregate Commitments and payment in full of all Obligations (other than contingent indemnification obligations) and the expiration or termination of all Letters of Credit (other than Letters of Credit as to which other arrangements satisfactory to the Administrative Agent and the L/C Issuer shall have been made), (ii) that is sold or to be sold as part of or in connection with any sale permitted hereunder or under any other Loan Document, or (iii) subject to Section 11.01, if approved, authorized or ratified in writing by the Required Lenders;

 

(b)           to subordinate any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 8.01;

 

(c)           to release any Guarantor from its obligations under the Guaranty if such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder or pursuant to Section 4.08; and

 

(d)           to the extent permitted by Section 4.08, release any Borrowing Base Property.

 

Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release its interest in particular types or items of property, or to release any Guarantor from its obligations under the Guaranty pursuant to this Section 10.10.

 

ARTICLE XI.  MISCELLANEOUS

 

11.01 Amendments, Etc.No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Borrower or any other Loan Party therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower or the applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, however, that no such amendment, waiver or consent shall:

 

  

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(a) waive any condition set forth in Section 5.01(a) without the written consent of each Lender;

 

(b) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 9.02) without the written consent of such Lender;

 

(c) postpone any date fixed by this Agreement or any other Loan Document for any payment or mandatory prepayment of principal, interest, fees or other amounts due to the Lenders (or any of them) or any scheduled or mandatory reduction of the Aggregate Commitments hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

 

(d) reduce the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso to this Section 11.01) any fees or other amounts payable hereunder or under any other Loan Document, or change the manner of computation of any financial ratio (including any change in any applicable defined term) used in determining the Applicable Rate that would result in a reduction of any interest rate on any Loan or any fee payable hereunder without the written consent of each Lender directly affected thereby; provided, however, that only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” or to waive any obligation of the Borrower to pay interest or Letter of Credit Fees at the Default Rate;

 

(e) change Section 9.03 in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender;

 

(f) change any provision of this Section or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender;

 

(g) release all or substantially all of the value of the Collateral without the written consent of each Lender, except to the extent the release of such Collateral is permitted pursuant to Sections 4.08 or 10.10 (in which case such release may be made by Administrative Agent acting alone); or

 

(h) release all or substantially all of the value of the Guaranty without the written consent of each Lender, except to the extent the release of any Guarantor is permitted pursuant to Section 10.10 (in which case such release may be made by the Administrative Agent acting alone);

 

and, provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the L/C Issuer in addition to the Lenders required above, affect the rights or duties of the L/C Issuer under this Agreement or any Issuer Document relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swing Line Lender in addition to the Lenders required above, affect the rights or duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders required above, affect the rights or duties of the Administrative Agent under this Agreement or

 

  

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any other Loan Document; and (iv) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto.  Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of any Defaulting Lender may not be increased or extended without the consent of such Lender and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lenders shall require the consent of such Defaulting Lender.

 

11.02 Notices; Effectiveness; Electronic Communication.  

 

(a) Notices Generally.  Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

 

(i) if to the Borrower, the Administrative Agent, the L/C Issuer or the Swing Line Lender, to the address, telecopier number, electronic mail address or telephone number specified for such Person on Schedule 11.02; and

 

(ii) if to any other Lender, to the address, telecopier number, electronic mail address or telephone number specified in its Administrative Questionnaire (including, as appropriate, notices delivered solely to the Person designated by a Lender on its Administrative Questionnaire then in effect for the delivery of notices that may contain material non-public information relating to the Borrower).

 

Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices and other communications sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient).  Notices and other communications delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b).

 

(b) Electronic Communications.  Notices and other communications to the Lenders and the L/C Issuer hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender or the L/C Issuer pursuant 

 

  

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to Article II if such Lender or the L/C Issuer, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication.  The Administrative Agent or the 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.

 

Unless the 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 Platform.  THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM.  In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to the Borrower, any Lender, the L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided, however, that in no event shall any Agent Party have any liability to the Borrower, any Lender, the L/C Issuer or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

 

(d) Change of Address, Etc.  Each of the Borrower, the Administrative Agent, the L/C Issuer and the Swing Line Lender may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the other parties hereto.  Each other Lender may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the Borrower, the Administrative Agent, the L/C Issuer and the Swing Line Lender.  In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, telecopier number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender.  Furthermore, each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its 

 

  

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delegate, in accordance with such Public Lender’s compliance procedures and applicable Law, including United States Federal and state securities Laws, to make reference to Borrower Materials that are not made available through the “Public Side Information” portion of the Platform and that may contain material non-public information with respect to the Borrower or its securities for purposes of United States Federal or state securities laws.

 

(e) Reliance by Administrative Agent, L/C Issuer and Lenders. The Administrative Agent, the L/C Issuer and the Lenders shall be entitled to rely and act upon any notices (including telephonic Committed Loan Notices and Swing Line Loan Notices) purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof.  The Borrower shall indemnify the Administrative Agent, the L/C Issuer, each Lender and the Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrower.  All telephonic notices to and other telephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

 

11.03 No Waiver; Cumulative Remedies; Enforcement.  No failure by any Lender, the L/C Issuer or the Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

 

Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent in accordance with Section 9.02 for the benefit of all the Lenders and the L/C Issuer; provided, however, that the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) the L/C Issuer or the Swing Line Lender from exercising the rights and remedies that inure to its benefit (solely in its capacity as L/C Issuer or Swing Line Lender, as the case may be) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in accordance with Section 11.08 (subject to the terms of Section 2.14), or (d) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party under any Debtor Relief Law; and provided, further, that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to Section 9.02 and (ii) in addition to the matters set forth in clauses (b), (c) and (d) of the preceding proviso and subject to Section 2.14, any Lender may, with the consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.

 

  

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11.04 Expenses; Indemnity; Damage Waiver.  

 

(a) Costs and Expenses.  The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent and its Affiliates (including the reasonable fees, charges and disbursements of counsel for the Administrative Agent), in connection with the syndication of the credit facilities provided for herein, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by the L/C Issuer in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all out-of-pocket expenses incurred by the Administrative Agent, any Lender or the L/C Issuer (including the fees, charges and disbursements of any counsel for the Administrative Agent, any Lender or the L/C Issuer, in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

 

(b) Indemnification by the Borrower.  The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender and the L/C Issuer, 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), 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, the consummation of the transactions contemplated hereby or thereby, or, in the case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan Documents (including in respect of any matters addressed in Section 3.01), (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (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 such 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 

 

  

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other Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction.

 

(c) Reimbursement by Lenders.  To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under subsection (a) or (b) of this Section to be paid by it to the Administrative Agent (or any sub-agent thereof), the L/C Issuer or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), the L/C Issuer or such Related Party, as the case may be, such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent) or the L/C Issuer in its capacity as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent) or L/C Issuer in connection with such capacity.  The obligations of the Lenders under this subsection (c) are subject to the provisions of Section 2.13(d).

 

(d) Waiver of Consequential Damages, Etc.  To the fullest 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 direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof.  No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.

 

(e) Payments.  All amounts due under this Section shall be payable not later than ten Business Days after demand therefor.

 

(f) Survival.  The agreements in this Section shall survive the resignation of the Administrative Agent, the L/C Issuer and the Swing Line Lender, the replacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations.

 

11.05 Payments Set Aside.  To the extent that any payment by or on behalf of the Borrower is made to the Administrative Agent, the L/C Issuer or any Lender, or the Administrative Agent, the L/C Issuer or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent, the L/C Issuer or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part 

 

  

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thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (b) each Lender and the L/C Issuer severally agrees to pay to the Administrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect.  The obligations of the Lenders and the L/C Issuer under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

 

11.06 Successors and Assigns.  

 

(a) Successors and Assigns Generally.  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 neither the Borrower nor any other Loan Party may 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 subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of subsection (d) of this Section, (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (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 subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the L/C Issuer and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b) Assignments by Lenders.  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 (including for purposes of this subsection (b), participations in L/C Obligations and in Swing Line 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 subsection (b)(i)(A) of this Section, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment, determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date, shall 

 

  

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              not be less than $5,000,000 unless each of the Administrative 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); provided, however, that concurrent assignments to members of an Assignee Group and concurrent

              assignments from members of an Assignee Group to a single Eligible Assignee (or to an Eligible Assignee and members of its Assignee Group) will be treated as a single assignment for purposes of determining whether such minimum amount has been met.

 

(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 or the Commitment assigned, except that this clause (ii) shall not apply to rights in respect of the Swing Line Lender’s rights and obligations in respect of Swing Line Loans;

 

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

 

(A) the consent of the Borrower (such consent not to be unreasonably withheld) shall be required unless (1) an Event of Default has occurred and is continuing at the time of such assignment or (2) 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 if such assignment is to a Person that is not a Lender, an Affiliate of such Lender or an Approved Fund with respect to such Lender;

 

(C) the consent of the L/C Issuer (such consent not to be unreasonably withheld or delayed) shall be required for any assignment that increases the obligation of the assignee to participate in exposure under one or more Letters of Credit (whether or not then outstanding); and

 

(D) the consent of the Swing Line Lender (such consent not to be unreasonably withheld or delayed) shall be required for any assignment.

 

(iv) Assignment and Assumption.  The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee in the amount of $3,500; provided, however, that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment.  The assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.

 

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

 

  

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        Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B), or (C) to a natural person.

 

(vi) Certain Additional Payments.  In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon) and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit and Swing Line Loans in accordance with its Applicable Percentage.  Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

 

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, 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 Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption 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 3.01, 3.04, 3.05, and 11.04 with respect to facts and circumstances occurring prior to the effective date of such assignment.  Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee Lender.  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection 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 subsection (d) of this Section.

 

(c) Register.  The Administrative Agent, acting solely for this purpose as an agent of the Borrower (and such agency being solely for tax purposes), shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans and L/C Obligations owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name 

 

  

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is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. In addition, the Administrative Agent shall maintain on the Register information regarding the designation, and revocation of designation, of any Lender as a Defaulting Lender.   The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

 

(d) Participations.  Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person, a Defaulting Lender or 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 (including such Lender’s participations in L/C Obligations and/or Swing Line 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 L/C Issuer 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, waiver or other modification described in the first proviso to Section 11.01 that affects such Participant.  Subject to subsection (e) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 11.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.14 as though it were a Lender.

 

(e) Limitations upon Participant Rights.  A Participant shall not be entitled to receive any greater payment under Section 3.01 or 3.04 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 3.01 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 3.01(e) as though it were a Lender.

 

(f) Certain Pledges.  Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under its Note, if any) to secure obligations of such Lender, including 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.

 

  

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(g) Resignation as L/C Issuer or Swing Line Lender after Assignment.  Notwithstanding anything to the contrary contained herein, if at any time Bank of America assigns all of its Commitment and Loans pursuant to subsection (b) above, Bank of America may, (i) upon 30 days’ notice to the Borrower and the Lenders, resign as L/C Issuer and/or (ii) upon 30 days’ notice to the Borrower, resign as Swing Line Lender.  In the event of any such resignation as L/C Issuer or Swing Line Lender, the Borrower shall be entitled to appoint from among the Lenders a successor L/C Issuer or Swing Line Lender hereunder; provided, however, that no failure by the Borrower to appoint any such successor shall affect the resignation of Bank of America as L/C Issuer or Swing Line Lender, as the case may be.  If Bank of America resigns as L/C Issuer, it shall retain all the rights, powers, privileges and duties of the L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the right to require the Lenders to make Base Rate Committed Loans or fund risk participations in Unreimbursed Amounts pursuant to Section 2.04(c)).  If Bank of America resigns as Swing Line Lender, it shall retain all the rights of the Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such resignation, including the right to require the Lenders to make Base Rate Committed Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section 2.05(c).  Upon the appointment of a successor L/C Issuer and/or Swing Line Lender, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender, as the case may be, and (b) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to Bank of America to effectively assume the obligations of Bank of America with respect to such Letters of Credit.

 

11.07 Treatment of Certain Information; Confidentiality.  Each of the Administrative Agent, the Lenders and the L/C Issuer agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees, agents, trustees, advisors and representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or any Eligible Assignee invited to be a Lender pursuant to Section 2.16(c) or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (g) with the consent of the Borrower or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Administrative Agent, any Lender, the L/C Issuer or any of their respective Affiliates on a nonconfidential basis from a source other than the Borrower.  For purposes of this Section, “Information” means all information received from the Borrower or any Subsidiary relating to the Borrower or any Subsidiary or any of their respective businesses, other than any such information that is available to the Administrative Agent, any Lender or the L/C Issuer on a nonconfidential basis prior to disclosure by the Borrower or any 

 

  

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Subsidiary, provided that, in the case of information received from the Borrower or any Subsidiary after the date hereof, such information is clearly identified at the time of delivery as confidential.  Any Person required to maintain the confidentiality of Information as provided in this Section 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 to its own confidential information.

 

Each of the Administrative Agent, the Lenders and the L/C Issuer acknowledges that (a) the Information may include material non-public information concerning the Borrower or a Subsidiary, as the case may be, (b) it has developed compliance procedures regarding the use of material non-public information and (c) it will handle such material non-public information in accordance with applicable Law, including United States Federal and state securities Laws.

 

11.08 Right of Setoff.If an Event of Default shall have occurred and be continuing, each Lender, the L/C Issuer and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender, the L/C Issuer or any such Affiliate to or for the credit or the account of the Borrower or any other Loan Party against any and all of the obligations of the Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or the L/C Issuer, irrespective of whether or not such Lender or the L/C Issuer shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower or such Loan Party may be contingent or unmatured or are owed to a branch or office of such Lender or the L/C Issuer different from the branch or office holding such deposit or obligated on such indebtedness; provided, that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.18 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff.  The rights of each Lender, the L/C Issuer and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, the L/C Issuer or their respective Affiliates may have.  Each Lender and the L/C Issuer agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application, provided that the failure to give such notice shall not affect the validity of such setoff and application.

 

11.09 Interest Rate Limitation.  Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”).  If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, 

 

  

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if it exceeds such unpaid principal, refunded to the Borrower.  In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

 

11.10 Counterparts; Integration; Effectiveness.  This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  This Agreement and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 5.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto.  Delivery of an executed counterpart of a signature page of this Agreement by telecopy or other electronic imaging means shall be effective as delivery of a manually executed counterpart of this Agreement.

 

11.11 Survival of Representations and Warranties.  All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof.  Such representations and warranties have been or will be relied upon by the Administrative Agent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

 

11.12 Severability.  If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions.  The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.  Without limiting the foregoing provisions of this Section 11.12, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent, the L/C Issuer or the Swing Line Lender, as applicable, then such provisions shall be deemed to be in effect only to the extent not so limited.

 

11.13 Replacement of Lenders.  If any Lender requests compensation under Section 3.04, or if the Borrower is required to pay any additional amount to any Lender or any 

 

  

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Governmental Authority for the account of any Lender pursuant to Section 3.01, 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 contained in, and consents required by, Section 11.06), all of its interests, rights and obligations under this Agreement and the related Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided that:

 

(a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 11.06(b);

 

(b) such Lender shall have received payment of an amount equal to 100% of the outstanding principal of its Loans and L/C Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.05) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);

 

(c) in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to be made pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter; and

 

(d) such assignment does not conflict with applicable Laws.

 

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

 

11.14 Governing Law; Jurisdiction; Etc.   

 

(a) GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

(b) SUBMISSION TO JURISDICTION.  THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, 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 FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO 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 FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN 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 IN ANY OTHER LOAN 

 

  

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DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(c) WAIVER OF VENUE.  THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION.  EACH OF THE PARTIES HERETO HEREBY 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) SERVICE OF PROCESS.  EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.02.  NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

11.15 Waiver of Jury Trial.  EACH PARTY HERETO HEREBY 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 OR RELATING TO 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 PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON 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.

 

11.16 No Advisory or Fiduciary Responsibility.  In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower and each other Loan Party acknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (i) (A) the arranging and other services regarding this Agreement provided by the Administrative Agent and the Sole Lead Arranger are arm’s-length commercial transactions between the Borrower , each other Loan Party and their respective Affiliates, on the one hand, and the Administrative Agent and the Sole Lead Arranger, on the other hand, (B) each of the Borrower and the other Loan Parties has consulted its own legal, accounting, regulatory and tax advisors to the extent it has 

 

  

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deemed appropriate, and (C) the Borrower and each other Loan Party is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) the Administrative Agent and the Sole Lead Arranger each is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower, any other Loan Party or any of their respective Affiliates, or any other Person and (B) neither the Administrative Agent nor the Sole Lead Arranger has any obligation to the Borrower, any other Loan Party or any of their respective Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent and the Sole Lead Arranger and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower, the other Loan Parties and their respective Affiliates, and neither the Administrative Agent nor the Sole Lead Arranger has any obligation to disclose any of such interests to the Borrower, any other Loan Party any of their respective Affiliates.  To the fullest extent permitted by law, each of the Borrower and the other Loan Parties hereby waives and releases any claims that it may have against the Administrative Agent and the Sole Lead Arranger with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

 

11.17 Electronic Execution of Assignments and Certain Other Documents.  The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption or in any amendment or other modification hereof (including waivers and consents) shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

 

11.18 USA PATRIOT Act.  Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender or the Administrative Agent, as applicable, to identify the Borrower in accordance with the Act.  The Borrower shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Act.

 

11.19 ENTIRE AGREEMENT.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG 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 AMONG THE PARTIES.

 

  

105

  

 

 

 

 

 

[SIGNATURE PAGES TO FOLLOW]

 

  

106

  

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

BORROWER:

 

 

SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP, a Michigan limited partnership

                         

                    By:     Sun Communities, Inc., a Maryland corporation, its general partner

 

            By: /s/ Karen J. Dearing        

             Karen J. Dearing

                                                            Its:   Executive Vice President

 

 

 

 

GUARANTORS:

 

 

SUN COMMUNITIES, INC., a Maryland corporation

 

                                                                         By:    /s/ Karen J. Dearing          

                                                                                            Karen J. Dearing

                                                                                            Executive Vice President

 

 

SUN TEXAS QRS, INC., a Michigan corporation

 

 

By:     /s/ Karen J. Dearing          

                                                                   Karen J. Dearing

                                                        Its:     Executive Vice President

 

 

SUN HOME SERVICES, INC., a Michigan corporation

 

 

By:      /s/ Karen J. Dearing           

            Karen J. Dearing

Its:      Executive Vice President

 

S-1

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

 

 

SUN COMMUNITIES FUNDING GP L.L.C., a Michigan limited liability company

 

                    By:      SCF Manager Inc., a Michigan corporation, its manager

                           

                       By:   /s/ Karen J. Dearing       

                                Karen J. Dearing

                                                                       Its:   Executive Vice President

 

 

 

SUNCHAMP HOLDINGS LLC, a Michigan limited liability company

 

By:      Sun Communities Operating Limited Partnership, a Michigan limited partnership, its manager

            

            By:      Sun Communities, Inc., a Maryland corporation, its general parner

                                                 

                                       By: /s/ Karen J. Dearing           

                                                                                                                                  Karen J. Dearing

                                                                                  Its:  Executive Vice President

 

 

 

SUN COMMUNITIES TEXAS LIMITED PARTNERSHIP,  a Michigan limited partnership

 

By:      Sun Texas QRS, Inc., a Michigan corporation, its general partner

 

                       By: /s/ Karen J. Dearing                

                                                                               Karen J. Dearing

                                                           Its:  Executive Vice President

 

  

S-2

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

 

 

SUN SADDLE BROOK LIMITED PARTNERSHIP, a Michigan limited partnership

 

	
  

	
By:

	
Sun Texas QRS, Inc., a Michigan corporation, its general partner

 

By: /s/ Karen J. Dearing                                                                                                    

       Karen J. Dearing

                                                               Its:  Executive Vice President

 

 

 

SUN OAKCREST LIMITED PARTNERSHIP, a Michigan limited partnership

 

	
  

	
By:

	
Sun Texas QRS, Inc., a Michigan corporation, its general partner

 

By: /s/ Karen J. Dearing                                                                                       

       Karen J. Dearing

                                                               Its:  Executive Vice President

 

 

 

RIVER HAVEN OPERATING COMPANY LLC, a Michigan limited liability company

 

	
  

	
By:

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership, its manager

 

	
  

	
By:

	
Sun Communities, Inc., a Maryland corporation, its general partner

 

By: /s/ Karen J. Dearing               

                                                                                       Karen J. Dearing

                                                                                   Its:  Executive Vice President

 

  

S-3

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

 

SUN COMMUNITIES FUNDING II LLC, a Michigan limited liability company

 

	
  

	
By:

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership, its manager

 

	
  

	
By:

	
Sun Communities, Inc., a Maryland corporation, its general partner

 

By: /s/ Karen J. Dearing               

                                                                                      Karen J. Dearing

                                                                                        Its:  Executive Vice President

 

 

 

 

SUN COMMUNITIES FUNDING LIMITED PARTNERSHIP, a Michigan limited partnership

 

	
  

	
By:

	
Sun Communities Funding GP L.L.C., a Michigan limited liability company, its general partner

 

	
  

	
By:

	
SCF Manager Inc., a Michigan corporation, its manager

 

By: /s/ Karen J. Dearing                

                                                                                      Karen J. Dearing

                                                                                        Its:  Executive Vice President

 

  

S-4

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

 

BANK OF AMERICA, N.A., as Administrative Agent

 

By:  /s/ Kathleen W Bozek                                                                              

 

Name:  Kathleen W Bozek                                       

 

Title:   Senior Vice President

 

                                                                        

  

S-5

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

BANK OF AMERICA, N.A., as a Lender, L/C Issuer and Swing Line Lender

 

By:  /s/ Kathleen W Bozek   

 

Name: Kathleen W Bozek                                       

 

Title: Senior Vice President

 

                                                                   

  

S-6

SIGNATURE PAGE TO CREDIT AGREEMENT

  

                         FIFTH THIRD BANK, an Ohio banking corporation, as a Lender

 

                         By: /s/ Klay Schmeisser                             

 

                         Name: Klay Schmeisser

 

                         Its:  Senior Vice President

                                                            

  

S-7

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

                         PNC BANK, NATIONAL BANK, as a Lender

 

                         By: /s/ Timothy H. Hampton                           

 

                         Name:  Timothy H. Hampton

 

                         Its:  Senior Vice President

                                                          

  

S-8

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

                         THE PRIVATEBANK AND TRUST COMPANY, an Illinois state chartered bank, as a Lender

 

                         By: /s/ Stephen A. Anderson                                

 

                         Name: Stephen A. Anderson

 

                         Its: Managing Director

                                                     

  

S-9

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

 

                         CITIBANK, N.A., as a Lender

 

                         By: /s/ John C. Rowland                                                            

 

                         Name:  John C. Rowland

 

                         Its:  Vice President

                                                       

  

S-10

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

 

                         COMERICA BANK, as a Lender

 

                         By: /s/ Adam Sheets                                          

 

                         Name:  Adam Sheets

 

                         Its: Vice President

                                                    

  

S-11

SIGNATURE PAGE TO CREDIT AGREEMENT

  

 

SCHEDULE 1.01(A)

 

 

COMMITMENTS

AND APPLICABLE PERCENTAGES

 

	
Lender

	 	
Commitment

	 	 	
Applicable Percentage

	 
	
Bank of America, N.A.

	 	$	37,500,000.00	 	 	 	28.846153846	%
	
Fifth Third Bank

	 	$	27,500,000.00	 	 	 	21.153846154	%
	
PNC Bank

	 	$	20,000,000.00	 	 	 	15.384615385	%
	
The PrivateBank and Trust

	 	$	20,000,000.00	 	 	 	15.384615385	%
	
Company

	 	 	 	 	 	 	 	 
	
Citibank, N.A.

	 	$	15,000,000.00	 	 	 	11.538461538	%
	
Comerica Bank

	 	$	10,000,000.00	 	 	 	7.692307692	%
	  	 	 	 	 	 	 	 	 
	
Total:

	 	$	130,000,000.00	 	 	 	100.000000000	%

 

 

  

Schedule 1.01 (A)

1

  

 

 

 

 

 

SCHEDULE 1.01(B)

 

Initial Guarantors

 

 

1.           Sun Texas QRS, Inc., a Michigan corporation

 

2.           Sun Communities Funding GP L.L.C., a Michigan limited liability company

 

3.           SunChamp Holdings LLC, a Michigan limited liability company

 

4.           Sun Communities Texas Limited Partnership,  a Michigan limited partnership

 

5.           Sun Saddle Brook Limited Partnership, a Michigan limited partnership

 

6.           Sun Oakcrest Limited Partnership, a Michigan limited partnership

 

7.           River Haven Operating Company LLC, a Michigan limited liability company

 

8.           Sun Communities Funding II LLC, a Michigan limited liability company

 

9.           Sun Home Services, Inc., a Michigan corporation

 

	
  

	
10.

	
Sun Communities Funding Limited Partnership, a Michigan limited partnership

 

	
  

	
11.

	
Sun Communities, Inc., a Maryland corporation

 

 

  

Schedule 1.01 (B)

1

  

 

SCHEDULE 1.01(C)

 

SunChamp Collateral

	
1.  

	
Deed of Trust (with Security Agreement, Assignment of Rents and Leases and Financing Statement) dated February 15, 2000, by FC RIVER RANCH LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of Bryan C. Birkeland, as trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, beneficiary, recorded in the Travis County Clerk’s Official Public Records, documents number 2000033217.

 

	
2.  

	
Absolute Assignment of Leases and Rents, dated February 15, 2000, by and between FC RIVER RANCH LIMITED PARTNERSHIP, a Michigan limited partnership, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Travis County Clerk’s Official Public Records, document number 2000033218.

 

	
3.  

	
Cross Default and Cross Collateral Agreement, dated August 30, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTNERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, FC GLEN LAUREL LLC, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Travis County Clerk’s Official Public Records, document number 2000176487.

 

	
4.  

	
Intercreditor and Subordination Agreement, dated February 15, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, and FC RIVER RANCH LIMITED PARTNERSHIP, recorded in the Travis County Clerk’s Official Public Records, document number 2000033220.

 

	
5.  

	
Deed of Trust (with Security Agreement, Assignment of Leases and Rents and Financing Statement) dated January 26, 2000, by FC RIVER RANCH LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of James M. Nias, as trustee, for the benefit of SUN COMMUNITIES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, a Michigan limited partnership, recorded in the Travis County Clerk’s Official Public Records, documents number 2000033222.

 

	
6.  

	
Deed of Trust (with Security Agreement, Assignment of Leases and Rents and Financing Statement) dated February 4, 2000, by FC STONEBRIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of James M. Nias, as trustee, for the benefit of SUN COMMUNITITES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, a Michigan limited partnership, beneficiary, recorded under document number 20000-0021826, Vol. 8304, Page 81, in the Bexar County Clerk’s Official Public Records, Texas.

 

	
7.  

	
Intercreditor and Subordination Agreement, dated January 31, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, and FC STONEBRIDGE LIMITED PARTNERSHIP, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0021825, Vol. 8304, Page 0060.

 

  

Schedule 1.01 (C)

1

  

 

	
8.  

	
Deed of Trust (with Security Agreement, Assignment of Rents and Leases and Financing Statement) dated January 31, 2000, by and between FC STONEBRIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, and Larry A. Jack, as trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, beneficiary, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0021821, Vol. 8303, Page 2032.

 

	
9.  

	
Absolute Assignment of Leases and Rents, dated January 31, 2000, by and between FC STONEBRIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, and CONSECO FINANCE SERVICING CORP., a Delaware corporation; recorded in Bexar County Clerk’s Official Public Records, file number 2000-0021822, Vol. 8303, Page 2073.

 

	
10.  

	
Cross Default and Cross Collateral Agreement, dated January 31, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTNERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0021824, Vol. 8304, Page 0015.

 

	
11.  

	
Cross Default and Cross Collateral Agreement, dated August 30, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTNERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, FC GLEN LAUREL LLC, AND CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0197960, Vol. 8648, Page 1205.

 

	
12.  

	
Deed of Trust (with Security Agreement, Assignment of Rents and Leases and Financing Statement) dated January 31, 2000, by and between FC SUMMIT RIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, and Larry A. Jack, as trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, beneficiary, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0021834, Vol. 8304, Page 0180.

 

	
13.  

	
Absolute Assignment of Leases and Rents, dated January 31, 2000, by and between FC SUMMIT RIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0021835, Vol. 8304, Page 0218.

 

	
14.  

	
Cross Default and Cross Collateral Agreement, dated January 31, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTNERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0021837, Vol. 8304, Page 0248.

 

  

Schedule 1.01 (C)

2

  

 

	
15.  

	
Intercreditor and Subordination Agreement, dated January 31, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, and FC SUMMIT RIDGE LIMITED PARTNERSHIP, recorded in Bexar County Clerk’s Official Public Records, file number 2000-0021838, Vol. 8304, Page 0292.

 

	
16.  

	
Cross Default and Cross Collateral Agreement, dated August 30, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTNERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0197960, Vol. 8648, Page 1205.

 

	
17.  

	
Deed of Trust (with Security Agreement, Assignment of Rents and Leases and Financing Statement) dated February 4, 2000, by and between FC SUMMIT RIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of James M. Nias, as trustee, for the benefit of SUN COMMUNITIES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, a Michigan limited partnership, beneficiary, recorded under document number 2000-0021839, Vol. 8304, Page 310, in the Bexar County Clerk’s Official Public Records, Texas.

 

	
18.  

	
Open-end Mortgage and Security Agreement, dated January 31, 2000, by and between FC EAST FORK CROSSING LLC, a Michigan limited liability company (the “Borrower”), and CONSECO FINANCE SERVICING CORP., a Delaware corporation, of record in the Recorder’s Office of Clermont County, Ohio, as instrument number 200000003789, Book 1249, Page 1895.

 

	
19.  

	
Assignment of Rents, Leases, Profits and Contracts, dated January 31, 2000, by and between FC EAST FORK CROSSING LLC, a Michigan limited liability company, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, of record in the Recorder’s Office of Clermont County, Ohio, as instrument number 200000003790, Book 1249, Page 1922.

 

	
20.  

	
Cross Default and Cross Collateral Agreement, dated January 31, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARNTERSHIP, FC SUMMIT RIDGE LIMITED PARNTERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, of record in the Recorder’s Office of Clermont County, Ohio, as instrument number 200000003792, Book 1249, Page 1938.

 

	
21.  

	
Intercreditor and Subordination Agreement, dated January 31, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES MEZZANINE LENDER, LLC, and FC EAST FORK CROSSING LLC, a Michigan limited liability company, of record in the Recorder’s Office of Clermont County, Ohio, as instrument number 200000003793, Book 1249, Page 1982.

 

  

Schedule 1.01 (C)

3

  

 

	
22.  

	
Cross Default and Cross Collateral Agreement, dated August 30, 2002, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTNERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, FC GLEN LAUREL LLC, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Book 1288, Page 1495, Instrument number 200000029588 in the Recorder’s Office of Clermont County, Ohio

 

	
23.  

	
Open-End Mortgage, Security Agreement, Assignment of Leases and Rents and Financing Statement, dated February 4, 2000, by FC EAST FORK CORSSING LLC, a Michigan limited liability company, in favor of SUN COMMUNITIES MEZZANINE LENDER, LLC, a Michigan limited liability company, recorded in Book 1249, Page 1992, Instrument number 200000003794 in the Recorder’s Office of Clermont County, Ohio.

 

	
24.  

	
Deed of Trust and Security Agreement, dated August 30, 2000, by FC GLEN LAUREL LLC, a Michigan limited liability company, in favor of R. Frank Gray, as trustee, for the benefit of SUN COMMUNITIES MEZZANINE LENDER, LLC, a Michigan limited liability company, recorded in Book 2967, Page 200 of the Cabarrus County Registry, North Carolina, document number 021504.

 

	
25.  

	
Intercreditor and Subordination Agreement, dated August 30, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES MEZZANINE LENDER, LLC, and FC GLEN LAUREL LLC, a Michigan limited liability company, recorded in Book 2967, Page 145, Cabarrus County Registry.

 

	
26.  

	
Deed of Trust, Assignment of Leases and Security Agreement dated August 30, 2000, by and between FC GLEN LAUREL LLC, in favor of Ashley L. Hogewood, Jr., trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, beneficiary, recorded in Book 2967, Page 111, Cabarrus County Registry.

 

	
27.  

	
Assignment of Rents, Leases, Profits and Contracts, dated August 30, 2000, by and between FC GLEN LAUREL LLC, a Michigan limited liability company, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Book 2967, Page 135, Cabarrus County Registry.

 

	
28.  

	
Cross Default and Cross Collateral Agreement dated August 30, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK, LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE RIDGE LIMITED PARTNERSHIP, FC GLEN LAUREL LLC, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Book 2967, Page 157, Cabarrus County Registry.

 

	
29.  

	
Mortgage, Security Agreement, Assignment of Leases and Rents and Financing Statement, dated February 4, 2000, by FC PEBBLE CREEK LLC, a Michigan limited liability company, for the benefit of SUN COMMUNITIES MEZZANINE LENDER, LLC, a Michigan limited liability company, recorded as instrument number 2000-003255 in the Office of the Recorder of Johnson County, Indiana.

 

  

Schedule 1.01 (C)

4

  

 

	
30.  

	
Intercreditor and Subordination Agreement, dated January 31, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES MEZZANINE LENDER, LLC, and FC PEBBLE CREEK, LLC, a Michigan limited liability company, recorded as instrument number 2000-003256, in the Office of the Recorder of Johnson County, Indiana.

 

	
31.  

	
Mortgage and Security Agreement, dated January 31, 2000, by and between FC PEBBLE CREEK, LLC, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded as instrument number 2000-003252, in the Office of the Recorder of Johnson County, Indiana.

 

	
32.  

	
Assignment of Rents, Leases, Profits and Contracts, dated January 31, 2000, by and between FC PEBBLE CREEK, LLC, a Michigan limited liability company, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded as instrument number 2000-003253 in the Office of the Recorder of Johnson County, Indiana.

 

	
33.  

	
Cross Default and Cross Collateral Agreement, dated August 30, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, FC GLEN LAUREL LLC, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded as instrument number 2000-025417 in the Office of the Recorder of Johnson County, Indiana.

 

	
34.  

	
Deed of Trust, Assignment of Leases and Security Agreement dated January 31, 2000 by FC MEADOWBROOK LLC, in favor of Ashley L. Hogewood, Jr., trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, beneficiary, recorded in Book 11072, Page 650, as instrument number 2000016226, Mecklenburg County Public Registry.

 

	
35.  

	
Assignment of Rents, Leases, Profits and Contracts, dated January 31, 2000 by and between FC MEADOWBROOK LLC, a Michigan limited liability company, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Book 11072, Page 687, as instrument number 2000016227, Mecklenburg County Public Registry.

 

	
36.  

	
Cross Default and Cross Collateral Agreement, dated August 30, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, FC GLEN LAUREL LLC, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Book 11871, Page 680, as instrument number 2001009011, Mecklenburg County Public Registry.

 

	
37.  

	
Intercreditor and Subordination Agreement, dated January 31, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES MEZZANINE LENDER, LLC, and FC MEADOWBROOK LLC, a Michigan limited liability company, recorded in Book 11092, Page 359, as instrument number 2000021242, Mecklenburg county Public Registry.

 

  

Schedule 1.01 (C)

5

  

 

	
38.  

	
Deed of Trust and Security Agreement, dated February 4, 2000, by FC MEADOWBROOK LLC, a Michigan limited liability company, in favor of R. Frank Gray, as trustee, for the benefit of SUN COMMUNITIES MEZZANINE LENDER, LLC, a Michigan limited liability company, recorded in Book 11072, Page 788 of the Mecklenburg County Registry, North Carolina, document number 2000016230.

 

	
39.  

	
Deed of Trust (With Security Agreement, Assignment of Leases and Rents and Financing Statement) dated December 29, 1999, by CP COMAL FARMS LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of James M. Nias, as trustee, for the benefit of SUN COMMUNITIES MEZZANINE LENDER, LLC, a Michigan limited liability company, recorded in the Comal County Clerk’s Official Public Records, document number 200006002028.

 

	
40.  

	
Intercreditor and Subordination Agreement, dated May 1, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, and CP COMAL FARMS LIMITED PARTNERSHIP, recorded in the Comal County Clerk’s Official Public Records, document number 200006013597.

 

	
41.  

	
Deed of Trust (With Security Agreement, Assignment of Rents and Leases and Financing Statement) dated May 1, 2000, CP COMAL FARMS LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of Bryan C. Birkeland, as trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, beneficiary, recorded in the Comal County Clerk’s Official Public Records, document number 200006013593.

 

	
42.  

	
Absolute Assignment of Leases and Rents, dated May 1, 2000, by and between CP COMAL LIMITED PARTNERSHIP, a Michigan limited partnership, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Comal County Clerk’s Official Public Records, document number 200006013594.

 

	
43.  

	
Cross Default and Cross Collateral Agreement, dated May 1, 2000, by and between CP CREEKSIDE LLC, CP COMAL FARMS LIMITED PARTNERSHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Comal County Clerk’s Official Public Records, document number 200006013596.

 

	
44.  

	
Cross Default and Cross Collateral Agreement, dated May 6, 2000, by and between CP CREEKSIDE LLC, CP COMAL FARMS LIMITED PARTNERSHIP, CP WOODLAKE LIMITED PARTNERHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Comal County Clerk’s Official Public Records, document number 200006022646.

 

 

  

Schedule 1.01 (C)

6

  

 

	
45.  

	
Modification to Deed of Trust, dated June 29, 2001, by CP COMAL FARMS LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of Bryan C. Birkeland, as trustee, recorded, in the Comal County Clerk’s Official Public Records, document number 200106023421.

 

	
46.  

	
Deed of Trust, Assignment of Leases and Security Agreement, dated April 19, 2000, by CP CREEKSIDE LLC, a Michigan limited liability company, in favor of Ashley L. Hogewood, Jr., as trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Book 1036, Page 822, Rockingham County Registry.

 

	
47.  

	
Assignment of Rents, Leases, Profits and Contracts, dated April 19, 2000, by and between CP CREEKSIDE LLC, a Michigan limited liability company, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Book 1036, Page 845, Rockingham County Registry.

 

	
48.  

	
Cross Default and Cross Collateral Agreement, dated May 1, 2000, by and between CP CREEKSIDE LLC, CP COMAL FARMS LIMITED PARTNERSHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in Book 1040, Page 1292, Rockingham County Registry.

 

	
49.  

	
Intercreditor and Subordination Agreement, dated April 19, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES MEZZANINE LENDER, LLC, and CP CREEKSIDE LLC, a Michigan limited liability company, recorded in book 1036, Page 855, Rockingham County Registry.

 

	
50.  

	
Cross Default and Cross Collateral Agreement dated May 6, 2000, by and between CP CREEKSIDE LLC, CP COMAL FARMS LIMITED PARTNERSHIP, CP WOODLAKE LIMITED PARTNERHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Rockingham County Registry.

 

	
51.  

	
Deed of Trust and Security Agreement, dated December 29, 1999, by FC CREEKSIDE LLC, a Michigan limited liability company, in favor of R. Frank Gray, as trustee, for the benefit of SUN COMMUNITEIS MEZZANINE LENDER, LLC, recorded in Book 1030, Page 641, Rockingham County Registry, North Carolina.

 

	
52.  

	
Deed of Trust (With Security Agreement, Assignment of Rents and Leases and Financing Statement) dated May 6, 2000, by and between CP WOODLAKE LIMITED PARTNERSHIP, a Michigan limited partnership, and Bryan C. Birkeland, as trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, beneficiary, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0076877, Vol. 8413, Page 1212.

 

  

Schedule 1.01 (C)

7

  

 

	
53.  

	
Absolute Assignment of Leases and Rents, dated May 6, 2000, by and between CP WOODLAKE LIMITED PARTNERSHIP, a Michigan limited partnership, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0076878, Vol. 8413, Page 1247.

 

	
54.  

	
Cross Default and Cross Collateral Agreement, dated May 6, 2000, by and between CP CREEKSIDE LLC, CP COMAL FARMS LIMITED PARTNERSHIP, CP WOODLAKE LIMITED PARTNERSHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0076880, Vol. 8413, Page 1271.

 

	
55.  

	
Intercreditor and Subordination Agreement, dated May 6, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITIES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, and CP WOODLAKE LIMITED PARTNERSHIP, recorded in the Bexar County Clerk’s Official Public Records, file number 2000-0076881, Vol. 8413, Page 1285.

 

	
56.  

	
Deed of Trust (With Security Agreement, Assignment of Leases and Rents and Financing Statement) dated December 29, 1999, by CP WOODLAKE LIMITED PARTNERSHIP, a Michigan limited partnership in favor of James M.. Nias, as trustee, for the benefit of SUN COMMUNITES MEZZANINE LENDER, LLC, a Michigan limited liability company, recorded in the Bexar County Clerk’s Official Public Records, document number 2000-0010656, Volume 8281, Page 416.

 

	
57.  

	
Deed of Trust (With Security Agreement, Assignment of Leases and Rents and Financing Statement) dated January 24, 2000, by FC SUNSET RIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of Bryan C. Birkeland, as trustee, for the benefit of CONSECO FINANCE SERVICING CORP., a Delaware corporation, beneficiary, recorded under document number 0002793, Vol., 1631, Page 52, in the Official Public Records of Hays County, Texas.

 

	
58.  

	
Absolute Assignment of Leases and Rents, dated January 24, 2000, by and between FC SUNSET RIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded under document number 0002795, Vol. 1631, Page 104, in the Official Public Records of Hays County, Texas.

 

  

Schedule 1.01 (C)

8

  

 

	
59.  

	
Cross Default and Cross Collateral Agreement, dated January 18, 2000, by and between FC EAST FORK CROSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE PARTNERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded under document number 0002796, Vol. 1631, Page 120, in the Official Public Records of Hays County, Texas.

 

	
60.  

	
Intercreditor and Subordination Agreement, dated January 26, 2000, by and between CONSECO FINANCE SERVICING CORP., a Delaware corporation, SUN COMMUNITES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, and FC SUNSET RIDGE LIMITED PARTNERSHIP, recorded under document number 0002797, Vol. 1631, Page 164, in the Official Public Records of Hays County, Texas.

 

	
61.  

	
Cross Default and Cross Collateral Agreement, dated August 30, 2000, by and between FC EAST FORK CORSSING LLC, FC MEADOWBROOK LLC, FC PEBBLE CREEK LLC, FC RIVER RANCH LIMITED PARTNERSHIP, FC STONEBRIDGE LIMITED PARTNERSHIP, FC SUMMIT RIDGE LIMITED PARTNERSHIP, FC SUNSET RIDGE LIMITED PARTNERSHIP, FC GLEN LAUREL LLC, and CONSECO FINANCE SERVICING CORP., a Delaware corporation, recorded under document number 00028199, Vol. 1745, Page 706, in the Official Public Records of Hays County, Texas.

 

	
62.  

	
Deed of Trust (With Security Agreement, Assignment of Leases and Rents and Financing Statement) dated January 26, 2000, by FC SUNSET RIDGE LIMITED PARTNERSHIP, a Michigan limited partnership, in favor of James M. Nias, as trustee, for the benefit of SUN COMMUNITIES TEXAS MEZZANINE LENDER LIMITED PARTNERSHIP, a Michigan limited partnership, beneficiary, recorded under document number 0002794, Vol. 1631, Page 86, in the Official Public Records of Hays County, Texas.

 

 

  

Schedule 1.01 (C)

9

  

SCHEDULE 1.01(D)

 

SunChamp Properties

 

 

 

	
Comal Farms (New Braunfels, TX)

	
Creekside (Reidsville, NC)

	
East Fork Crossing (Batavia, OH)

	
Glen Laurel (Concord, NC)

	
Meadowbrook (Charlotte, NC)

	
Pebble Creek (Greenwood, IN)

	
River Ranch (Austin, TX)

	
Stonebridge (San Antonio, TX)

	
Summit Ridge (Converse, TX)

	
Sunset Ridge (Kyle, TX)

	
Woodlake Trails (San Antonio, TX)

SunChamp Property Owner Entities

CP Comal Farms Limited Partnership

CP Creekside LLC

FC East Fork Crossing LLC

FC Glen Laurel LLC

FC Meadowbrook LLC

FC Pebble Creek LLC

FC River Ranch Limited Partnership

FC Stonebridge Limited Partnership

FC Summit Ridge Limited Partnership

FC Sunset Ridge Limited Partnership

CP Woodlake Limited Partnership

 

  

Schedule 1.01 (D)

1

  

 

 

 

SCHEDULE 1.01(E)

 

Existing Letters of Credit

 

SUN COMMUNITIES

LETTERS OF CREDIT

 

 

	
Letter #

	  	
 Project

	  	
 Expiration

Date

	  	
 Amount

	
68046195

	  	
Multiple Properties

	  	
13-Oct-12

	  	
 $                                               705,000.00

	
S45368203

	  	
North Point

	  	
1-Oct-12

	  	
 $                                            1,269,632.61

	
S453944

	  	
River Ranch

	  	
1-Feb-12

	  	
 $                                                 19,500.00

	
S453955

	  	
Sunset Ridge - TX

	  	
27-Jan-12

	  	
 $                                            1,984,582.73

	  	  	  	  	  	  	
 $                                            3,978,715.34

 

 

  

Schedule 1.01 (E)

1

  

 

 

SCHEDULE 1.01(F)

 

Equity Interest Collateral

	
 

Pledgor

	
Issuer

	
Interest in Issuer

	
PercentageOwnership

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership

	
Sun Communities Funding LP, a Michigan limited partnership

	
Limited Partnership

	
99.0%

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership

	
Sun Communities Funding II LLC, a Michigan limited liability company

	
Membership

	
100%

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership

	
Sun Communities Texas LP, a Michigan limited partnership

	
Limited Partnership

	
99.0%

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership

	
Sun Oakcrest LP, a Michigan limited partnership

	
Limited Partnership

	
99.0%

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership

	
Sun Saddle Brook LP, a Michigan limited partnership

	
Limited Partnership

	
99.0%

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership

	
River Haven Operating Company LLC, a Michigan limited liability company

	
Membership

	
100%

	
Sun Communities Operating Limited Partnership, a Michigan limited partnership

	
Sun/Forest Holdings LLC, a Michigan limited liability company

	
Membership

	
70.04%

	
Sun Communities Funding GP L.L.C., a Michigan limited liability company

	
Sun Communities Funding LP, a Michigan limited partnership

	
General Partnership

	
1.0%

	
Sun Texas QRS, Inc., a Michigan corporation

	
Sun Communities Texas LP, a Michigan limited partnership

	
General Partnership

	
1.0%

	
Sun Texas QRS, Inc., a Michigan corporation

	
Sun Oakcrest LP, a Michigan limited partnership

	
General Partnership

	
1.0%

	
Sun Texas QRS, Inc., a Michigan corporation

	
Sun Saddle Brook LP, a Michigan limited partnership

	
General Partnership

	
1.0%

	
SunChamp Holdings LLC, a Michigan limited liability company

	
SunChamp LLC, a Michigan limited liability company

	
Membership

	
41.76%

 

  

Schedule 1.01 (F)

1

  

 

SCHEDULE 1.01(G)

 

MORTGAGE ASSIGNMENTS

 

	
1.  

	
That certain Collateral Assignment of Mortgage, Security Agreement, Assignment of Leases and Rents and Financing Statement, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Mezzanine Lender, LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as East Fork Crossing located in Batavia, Ohio, as further described therein.

 

	
2.  

	
That certain Collateral Assignment of Mortgage and Security Agreement, Assignment of Rents, Leases, Profits and Contracts, Cross Default and Cross Collateral Agreement, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as East Fork Crossing located in Batavia, Ohio, as further described therein.

 

	
3.  

	
That certain Collateral Assignment of Deed of Trust and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Texas Mezzanine Lender Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Comal Farms located in New Braunfels, Texas, as further described therein.

 

	
4.  

	
That certain Collateral Assignment of Deed of Trust, Absolute Assignment of Leases and Rents, Cross Default and Cross Collateral Agreements, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial Texas Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Comal Farms located in New Braunfels, Texas, as further described therein.

 

	
5.  

	
That certain Collateral Assignment of Deed of Trust, Assignment of Rents, Leases, Profits and Contracts, Cross Default and Cross Collateral Agreements, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Creekside located in Reidsville, North Carolina, as further described therein.

 

	
6.  

	
That certain Collateral Assignment of Deed of Trust and Security Agreement and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Mezzanine Lender, LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Creekside located in Reidsville, North Carolina, as further described therein.

 

	
7.  

	
That certain Collateral Assignment of Deed of Trust, Assignment of Rents, Leases, Profits and Contracts, Cross Default and Cross Collateral Agreements, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Glen Laurel located in Concord, North Carolina, as further described therein.

 

  

Schedule 1.01 (G)

1

  

 

	
8.  

	
That certain Collateral Assignment of Deed of Trust and Security Agreement and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Mezzanine Lender, LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Glen Laurel located in Concord, North Carolina, as further described therein.

 

	
9.  

	
That certain Collateral Assignment of Deed of Trust, Assignment of Rents, Leases, Profits and Contracts, Cross Default and Cross Collateral Agreements, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Meadowbrook located in Charlotte, North Carolina, as further described therein.

 

	
10.  

	
That certain Collateral Assignment of Deed of Trust and Security Agreement and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Mezzanine Lender, LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Meadowbrook located in Charlotte, North Carolina, as further described therein.

 

	
11.  

	
That certain Collateral Assignment of Mortgage and Security Agreement, Assignment of Rents, Leases, Profits and Contracts, Cross Default and Cross Collateral Agreement, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Pebble Creek located in Greenwood, Indiana, as further described therein.

 

	
12.  

	
That certain Collateral Assignment of Mortgage, Security Agreement, Assignment of Leases and Rents and Financing Statement, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Mezzanine Lender, LLC, a Michigan limited liability company, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Pebble Creek located in Greenwood, Indiana, as further described therein.

 

	
13.  

	
That certain Collateral Assignment of Deed of Trust, Absolute Assignment of Leases and Rents, Cross Default and Cross Collateral Agreements, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial Texas Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Woodlake located in San Antonio, Texas, as further described therein.

 

	
14.  

	
That certain Collateral Assignment of Deed of Trust and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Texas Mezzanine Lender Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Woodlake located in San Antonio, Texas, as further described therein.

 

	
15.  

	
That certain Collateral Assignment of Deed of Trust, Absolute Assignment of Leases and Rents, Cross Default and Cross Collateral Agreement, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial Texas Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Stonebridge located in San Antonio, Texas, as further described therein.

 

  

Schedule 1.01 (G)

2

  

 

	
16.  

	
That certain Collateral Assignment of Deed of Trust and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Texas Mezzanine Lender Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Stonebridge located in San Antonio, Texas, as further described therein.

 

	
17.  

	
 That certain Collateral Assignment of Deed of Trust, Absolute Assignment of Leases and Rents, Cross Default and Cross Collateral Agreement, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial Texas Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as River Ranch located in Austin, Texas, as further described therein.

 

	
18.  

	
That certain Collateral Assignment of Deed of Trust and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Texas Mezzanine Lender Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as River Ranch located in Austin, Texas, as further described therein.

 

	
19.  

	
That certain Collateral Assignment of Deed of Trust, Absolute Assignment of Leases and Rents, Cross Default and Cross Collateral Agreement, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial Texas Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Summit Ridge located in Converse, Texas, as further described therein.

 

	
20.  

	
That certain Collateral Assignment of Deed of Trust and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Texas Mezzanine Lender Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Summit Ridge located in Converse, Texas, as further described therein.

 

	
21.  

	
That certain Collateral Assignment of Deed of Trust, Absolute Assignment of Leases and Rents, Cross Default and Cross Collateral Agreement, and Intercreditor and Subordination Agreement of even date hereof by and between Sun Financial Texas Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Sunset Ridge located in Kyle, Texas, as further described therein.

 

	
22.  

	
That certain Collateral Assignment of Deed of Trust and Intercreditor and Subordination Agreement of even date hereof by and between Sun Communities Texas Mezzanine Lender Limited Partnership, a Michigan limited partnership, as assignor, and Bank of America, N.A., as assignee, encumbering the property known as Sunset Ridge located in Kyle, Texas, as further described therein.

 

  

Schedule 1.01 (G)

3

  

 

 

SCHEDULE 4.01

 

Initial Borrowing Base Properties

 

	
1.      Bedford Hills Mobile  Village (Battle Creek, MI)

 

	
2.      Countryside Village MHC (Perry, MI)

 

	
3.      Cutler Estates Mobile Village (Grand Rapids, MI)

 

	
4.      Edwardsville Mobile Home Park (Edwardsville, KS)

 

	
5.      Sherman Oaks MHC (Jackson, MI)

 

	
6.      Timberbrook Mobile Home Park (Bristol, IN)

 

	
7.      Comal Farms (New Braunfels, TX)

 

	
8.      Creekside (Reidsville, NC)

 

	
9.      East Fork Crossing (Batavia, OH)

 

	
10.  Glen Laurel (Concord, NC)

 

	
11.  Meadowbrook (Charlotte, NC)

 

	
12.  Pebble Creek (Greenwood, IN)

 

	
13.  River Ranch (Austin, TX)

 

	
14.  Stonebridge (San Antonio, TX)

 

	
15.  Summit Ridge (Converse, TX)

 

	
16.  Sunset Ridge (Kyle, TX)

 

	
17.  Woodlake Trails (San Antonio, TX)

 

	
18.  Bell Crossing (Clarksville, Tennessee)

 

	
19.  Cobus Green (Elkhart, Indiana)

 

	
20.  College Park Estates (Canton, Michigan)

 

	
21.  Desert View Village (West Wendover, Nevada)

 

 

  

Schedule 4.01

1

  

 

	
22.  North Point Estates (Pueblo, Colorado)

 

	
23.  Pine Hills (Middlebury, Indiana)

 

	
24.  Sunset Ridge (Portland Twp., Michigan)

 

	
25.  Kenwood RV and Mobile Home Plaza (LaFeria, Texas)

 

	
26.  Pecan Branch (Williamson County, Texas)

 

	
27.  Oak Crest MHC (Austin, Tx)

 

	
28.  Saddlebrook MHC (Austin, TX)

 

	
29.  River Haven Village (Grand Haven, Michigan)

 

 

 

 

  

Schedule 4.01

2exv10w1

Exhibit 10.1

 Execution Version

SECOND AMENDMENT TO AMENDED AND RESTATED REVOLVING

AND TERM CREDIT AGREEMENT

     This Second Amendment to Amended and Restated Revolving and Term Credit Agreement (this
“Amendment”), made as of September 30, 2011, among FORESTAR (USA) REAL ESTATE GROUP INC., a
Delaware corporation (“Borrower”), the undersigned Guarantors, KEYBANK NATIONAL ASSOCIATION, a
national banking association (“KeyBank”), and the other financial institutions party to the Credit
Agreement as lenders (each individually a “Lender” and collectively, “Lenders”), and KEYBANK
NATIONAL ASSOCIATION, as Agent for the Lenders (in such capacity, “Agent”) and Swing Line Lender.

W I T N E S S E T H:

     WHEREAS, Borrower, Guarantors, Lenders, Agent, Swing Line Lender, and KeyBanc Capital Markets,
as sole arranger and sole bookrunner, entered into that certain Amended and Restated Revolving and
Term Credit Agreement dated as of August 6, 2010, as amended by First Amendment to Amended and
Restated Revolving and Term Credit Agreement dated as of May 6, 2011 (as so amended, the “Credit
Agreement”), pursuant to which Lenders established a revolving credit facility and a term loan
facility for the benefit of Borrower; and

     WHEREAS, Borrower has requested that certain terms of the Credit Agreement be modified and
amended as hereinafter set forth; and

     WHEREAS, Lenders and Agent have agreed to such amendments as set forth herein, subject to the
terms and conditions hereinafter set forth;

     NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions
contained herein and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties to this Amendment hereby agree that all capitalized terms used
but not defined herein shall have the meanings ascribed thereto in the Credit Agreement, and hereby
further agree as follows:

     1. Amendments to §1.1 of the Credit Agreement. Section 1.1 of the Credit Agreement,
Definitions, is hereby modified and amended by deleting the definitions of “Borrowing Base”
“Borrowing Base Assets”, “Permitted Refinancing Indebtedness” and “SPE Subsidiary” in their
entirety and by substituting the following new definitions in lieu thereof, respectively:

          Borrowing Base. As of any date of determination,

               (A) prior to the issuance of any Permitted Bond Indebtedness, the sum of the following
percentages of the Borrowing Base Assets:

          (a) forty-five percent (45%) of Timberland Value; plus

          (b) thirty-five percent (35%) of High Value Timberland Amount; plus

          (c) forty percent (40%) of Raw Entitled Land Value; plus

          (d) forty-five percent (45%) of Entitled Land Under Development Value; plus

          (e) sixty percent (60%) of Mineral Business Enterprise Value;

 

 

Provided, however, that the Borrowing Base shall be reduced by the amounts,
if any, by which (i) the portion of the Borrowing Base accounted for by clause (b) of this
definition would exceed twenty-five percent (25%) of the Borrowing Base, and (ii) the
portion of the Borrowing Base accounted for by clause (c) of this definition would exceed
twenty-five percent (25%) of the Borrowing Base; and provided further,
however, that the Borrowing Base shall be reduced by any reserve existing under
§9.1(a)(iii); and

               (B) effective upon the issuance of any Permitted Bond Indebtedness, the sum of the
following percentages of the Borrowing Base Assets:

          (a) forty-five percent (45%) of Timberland Value; plus

          (b) thirty-five percent (35%) of High Value Timberland Amount; plus

          (c) forty percent (40%) of Raw Entitled Land Value; plus

          (d) sixty percent (60%) of Mineral Business Enterprise Value;

Provided, however, that the Borrowing Base shall be reduced by the amounts,
if any, by which (i) the portion of the Borrowing Base accounted for by clause (b) of this
definition would exceed twenty-five percent (25%) of the Borrowing Base, and (ii) the
portion of the Borrowing Base accounted for by clause (c) of this definition would exceed
twenty-five percent (25%) of the Borrowing Base; and provided further,
however, that the Borrowing Base shall be reduced by any reserve existing under
§9.1(a)(iii).

          Borrowing Base Assets. The following assets:

               (A) prior to the issuance of any Permitted Bond Indebtedness, collectively, the
Timberland, the High Value Timberland, the Raw Entitled Land, the Entitled Land Under
Development and the Mineral Business. With respect to Borrowing Base Assets other than the
Mineral Business, parcels of Real Estate may from time to time move from one classification
of Borrowing Base Asset to another upon designation by Borrower on the Borrowing Base
Certificate most recently delivered to Agent, but can never be in more than one
classification at any point in time; and

               (B) effective upon the issuance of any Permitted Bond Indebtedness, collectively, the
Timberland, the High Value Timberland, the Raw Entitled Land, in each case to the extent
constituting Mortgaged Properties, and the Mineral Business. With respect to Borrowing Base
Assets other than the Mineral Business, parcels of Real Estate may from time to time move
from one classification of Borrowing Base Asset to another upon designation by Borrower on
the Borrowing Base Certificate most recently delivered to Agent, but can never be in more
than one classification at any point in time.

     In addition, from time to time, with the approval of the Required Lenders, additional
assets may be included in the Borrowing Base Assets, with percentages of the value thereof
included in the Borrowing Base similarly subject to the approval of the Required Lenders.

     
Permitted Refinancing Indebtedness. Any Indebtedness of the Loan Parties
issued in exchange for, or the net proceeds of which are used to extend, refinance, renew,

- 2 -

 

replace, defease or refund, Permitted Existing Indebtedness, Indebtedness otherwise
permitted by this Agreement or other Permitted Refinancing Indebtedness of such Person,
provided, that:

     (a) the principal amount of such Indebtedness (not including accrued or capitalized
interest and premiums, fees and expenses) does not exceed the then outstanding principal
amount of the Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded
(or in the case of Indebtedness of Capitol of Texas Insurance Group Inc. with respect to the
Radisson Hotel in Austin, Texas, such Indebtedness will replace previously repaid Permitted
Existing Indebtedness and will not exceed a principal amount of $16,000,000);

     (b) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded is Permitted Existing Indebtedness which is Non-Recourse Indebtedness, the
Permitted Refinancing Indebtedness with respect thereto must also be Non-Recourse
Indebtedness; and

     (c) no Default or Event of Default has occurred and is continuing or would result from
the issuance or origination of such Indebtedness.

     SPE Subsidiary. A bankruptcy remote or other special purpose entity which is
initially a Subsidiary and which is formed for the purpose of, and engages in no material
business other than, issuing or incurring Non-Recourse Indebtedness (and in the case of
Capitol of Texas Insurance Group Inc., issuing surety bonds and letters of credit in an
aggregate amount of up to $10,000,000 outstanding and issued at any time and acting as a
Guarantor hereunder) and, in connection therewith, owning Non-Recourse Assets and pledging
or transferring interests therein, including, without limitation, a Subsidiary formed for
the purpose of constructing, acquiring, owning, developing and/or financing Non-Recourse
Assets as Multifamily Properties. A Subsidiary whose only material assets are Equity
Interests in SPE Subsidiaries shall be considered an SPE Subsidiary for purposes hereof.”

     2. Amendment to §3.1(b) of the Credit Agreement. §3.1(b) of the Credit Agreement,
Extension Option, is hereby modified and amended by deleting the last sentence thereof in
its entirety.

     3. Amendment to §6.18 of the Credit Agreement. §6.18 of the Credit Agreement,
Environmental Compliance, is hereby modified and amended by deleting the words “the
Forestar Form 10” found in clauses (a), (b), (c) and (d) thereof, and substituting therefor the
words “Forestar Group’s Annual, Quarterly or Current Reports, each as filed with the Securities and
Exchange Commission prior to September 30, 2011”.

- 3 -

 

     4. Amendment to §9.1(c) of the Credit Agreement. §9.1(c) of the Credit Agreement,
Total Leverage Ratio, is hereby modified and amended by deleting the following language
from the end thereof: “provided, however, that during the Extension Period, the
Total Leverage Ratio as of the last day of any fiscal quarter may not exceed thirty percent (30%)”.

     5. Amendment to §9.3 of the Credit Agreement. §9.3 of the Credit Agreement, Value
to Commitment, is hereby modified and amended by deleting the ratio “1.60 to 1.0” at the end
thereof and substituting the ratio “1.50 to 1.0” in lieu thereof.

     6. No other Amendments. The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided or permitted herein, operate as an amendment or waiver of
any right, power or remedy of Agent or Lenders under the Credit Agreement or any of the other Loan
Documents, nor constitute an amendment or waiver of any provision of the Credit Agreement or any of
the other Loan Documents. Except for the amendments expressly set forth above, the text of the
Credit Agreement and all other Loan Documents shall remain unchanged and in full force and effect,
and Borrower and Guarantors hereby ratify and confirm their respective obligations thereunder, as
herein modified and amended. This Amendment shall not constitute a course of dealing with Agent or
Lenders at variance with the Credit Agreement or the other Loan Documents such as to require
further notice by Agent or Lenders to require strict compliance with the terms of the Credit
Agreement and the other Loan Documents in the future.

     7. Conditions of Effectiveness. This Amendment shall become effective as of the date
hereof when, and only when, Agent, on behalf of Lenders, shall have received, in form and substance
satisfactory to it, the following:

          (a) Counterparts of this Amendment duly executed by Borrower, each of the Guarantors and the
Required Lenders;

          (b) For the benefit of each Revolving Lender who executes this Amendment by 5:00 p.m. (CDT) on
September 30, 2011, the payment by Borrower of an amendment fee equal to 0.15% of the Commitment of
each such Lender, in immediately available funds, such fee being fully earned and non-refundable
when paid;

          (c) Additional Raw Entitled Land having an aggregate Raw Entitled Land Value of not less than
$68,180,270 and more particularly described on a Schedule delivered to Agent shall have become
Mortgaged Property, and the Mortgaged Property Documents for such Mortgaged Property shall have
been delivered to Agent granting a first-priority lien on such Mortgaged Property, subject only to
Permitted Liens. Borrower shall have paid to Agent any mortgage, recording, intangible,
documentary stamp or other similar taxes and charges which Agent reasonably determines to be
payable as a result of the recording of such Mortgaged Property documents to any state or any
county or municipality thereof in which any of such Mortgaged Properties are located, and delivered
to Agent such affidavits or other information which Agent reasonably determines to be necessary in
connection with such payment in order to insure that the Security Deeds on such Mortgaged Property
located in such state secures Borrower’s obligation with respect to the Loans.

- 4 -

 

          (d) True and correct copies of resolutions of the Borrower that authorize the execution,
delivery and performance of this Amendment and the other documents executed in connection herewith;

          (e) The representations and warranties made pursuant to Section 8 of this Amendment shall be
true and correct; and

          (f) Payment of all reasonable and documented expenses incurred by Agent in connection with the
execution and delivery of this Amendment, together with reasonable fees and actually incurred
expenses of Agent’s counsel with respect to this Amendment and other post-closing matters, in each
case to the extent invoiced at least one (1) Business Day prior to the date hereof.

     8. Representations and Warranties. Each of the Loan Parties represents and warrants
as follows:

          (a) The execution, delivery and performance by Borrower and each Guarantor of this Amendment
are within each such party’s legal powers, have been duly authorized by all necessary shareholder,
partner or member action and do not contravene (i) Borrower’s or any such Guarantor’s
Organizational Documents, respectively, or (ii) any law or contractual restriction binding on or
affecting such Person;

          (b) No authorization, approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body, except for those already obtained or made and the filing
of Security Documents delivered in connection herewith in the appropriate records office with
respect thereto, is required for the due execution, delivery and performance by Borrower or any
Guarantor of this Amendment;

          (c) This Amendment constitutes the legal, valid and binding obligations of each such party,
enforceable against such Person in accordance with their respective terms, provided that
enforcement may be limited by bankruptcy, insolvency, liquidation, reorganization, reconstruction
and other similar laws affecting enforcement of creditor’s rights generally and except to the
extent that availability of the remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding therefore may be brought;

          (d) All of the representations and warranties of the Loan Parties in the Loan Documents are
true and correct in all material respects as of the date hereof (or if such representations and
warranties by their terms relate solely to an earlier date, then as of such earlier date); and

          (e) No Default or Event of Default is existing and none would result, in each case upon this
Amendment becoming effective and after giving effect hereto.

     9. Reaffirmation of Guaranty. By execution of this Amendment, each Guarantor
reaffirms and restates its guaranty of the Obligations pursuant to the Guaranty Agreement and
agrees that its obligations thereunder are not released, diminished, impaired or reduced or
otherwise adversely affected by this Amendment.

- 5 -

 

     10. Reference to and Effect on the Loan Documents. Upon the effectiveness of this
Amendment, on and after the date hereof: each reference in the Credit Agreement to “this
Agreement,” “hereunder,” “hereof” or words of like import referring to the Credit Agreement, and
each reference in the other Loan Documents to the “Credit Agreement,” “thereunder,” “thereof” or
words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit
Agreement as amended and modified hereby.

     11. Costs, Expenses and Taxes. Borrower agrees to pay on demand all reasonable
out-of-pocket expenses of Agent actually incurred in connection with the preparation, execution and
delivery of this Amendment and the other instruments and documents to be delivered hereunder,
including, without limitation, the reasonable fees and out-of-pocket expenses of Agent’s counsel
with respect thereto and with respect to advising Agent as to its rights and responsibilities
hereunder and thereunder.

     12. Governing Law. This Amendment shall be governed by and construed in accordance
with the laws of the State of New York, without regard to the conflict of laws principles thereof.

     13. Loan Document. This Amendment shall be deemed to be a Loan Document for all
purposes.

     14. Exhibits and Schedules. The Exhibits and Schedules attached to this Amendment are
hereby incorporated herein by this reference.

     15. Counterparts. This Amendment may be executed by one or more of the parties hereto
on any number of separate counterparts, each of which shall be deemed an original and all of which,
taken together, shall be deemed to constitute one and the same instrument. Delivery of an executed
counterpart of this Amendment by facsimile or other electronic transmission shall be as effective
as delivery of a manually executed counterpart hereof.

[The remainder of this page is intentionally left blank]

- 6 -

 

     IN WITNESS WHEREOF, the undersigned have duly executed this Amendment as of the date
first set forth above.

	 	 	 	 	 
	 	BORROWER:

FORESTAR (USA) REAL ESTATE GROUP INC., a Delaware corporation

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Its: Chief Financial Officer 	 
	 

[SIGNATURES CONTINUED ON FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

[Execution of Second Amendment to Amended and Restated

Revolving and Term Credit Agreement Continued]

	 	 	 	 	 
	 	GUARANTORS:

FORESTAR GROUP INC., a Delaware corporation

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	FORESTAR MINERALS LLC, a Delaware 
limited liability company

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	FORESTAR OIL & GAS LLC, a Delaware
 limited liability company

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 

[SIGNATURES CONTINUED ON FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

[Execution of Second Amendment to Amended and Restated

Revolving and Term Credit Agreement Continued]

	 	 	 	 	 
	 	GUARANTORS (cont’d):

FORESTAR REALTY INC.,

a Delaware corporation

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	FORESTAR HOTEL HOLDING COMPANY

INC., a Nevada corporation

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	CAPITOL OF TEXAS INSURANCE GROUP

INC., a Delaware corporation

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	SWR HOLDINGS LLC, a Delaware limited
 liability company

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	SUSTAINABLE WATER RESOURCES LLC, a Texas limited liability company

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 

[SIGNATURES CONTINUED ON FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

[Execution of Second Amendment to Amended and Restated

Revolving and Term Credit Agreement Continued]

	 	 	 	 	 
	 	GUARANTORS (cont’d):

HARBOR LAKES GOLF CLUB LLC,

a Delaware limited liability company

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	JOHNSTOWN FARMS, LLC,

a Delaware limited liability company

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	SAN JACINTO I, LLC,

a Texas limited liability company

 	 
	 	By:  	/s/ Christopher L. Nines
 	 
	 	 	Name:  	Christopher L. Nines 	 
	 	 	Title:  	Chief Financial Officer 	 
	 

[SIGNATURES CONTINUED ON FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

[Execution of Second Amendment to Amended and Restated

Revolving and Term Credit Agreement Continued]

	 	 	 	 	 
	 	KEYBANK NATIONAL ASSOCIATION, as a

Lender, as Swing Line Lender and as Agent

 	 
	 	By:  	/s/ Nathan Weyer
 	 
	 	 	Name:  	Nathan Weyer 	 
	 	 	Title:  	Vice President 	 
	 

KeyBank National Association

1200 Abernathy Road, NE

Suite 1550

Atlanta, Georgia 30328

Attn: Daniel Silbert

Facsimile: (770) 510-2195

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

AgFIRST FARM CREDIT BANK, as a lender

 	 
	 	By:  	/s/ Matt Jeffords
 	 
	 	 	Name:  	Matt Jefford 	 
	 	 	Title:  	Assistant Vice President 	 
	 

Address:

1401 Hampton Street

Columbia, SC 29201

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

                [Execution Continued]

	 	 	 	 	 
	 	NORTHWEST FARM CREDIT SERVICES,

PCA, as a lender

 	 
	 	By:  	/s/ Carol L. Sobson
 	 
	 	 	Name:  	Carol L. Sobson 	 
	 	 	Title:  	Vice President 	 
	 

Address:

1700 South Assembly Street

Spokane, WA 99224

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

                [Execution Continued]

	 	 	 	 	 
	 	AMEGY BANK NATIONAL ASSOCIATION, as a lender

 	 
	 	By:  	/s/Kelly Nash
 	 
	 	 	Name:  	Kelly Nash 	 
	 	 	Title:  	Assistant Vice President 	 
	 

Address:

4400 Post Oak Parkway

Houston, TX 77027

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

                [Execution Continued]

	 	 	 	 	 
	 	CAPITAL ONE N.A., as a lender

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Address:

901 South Mopac

Building 1, Suite 500

Austin, TX 78746

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

           [Execution Continued]

	 	 	 	 	 
	 	METROPOLITAN LIFE INSURANCE COMPANY, 
as a lender

 	 
	 	By:  	/s/ C. Ray Smith
 	 
	 	 	Name:  	C. Ray Smith 	 
	 	 	Title:  	Regional Director 	 
	 

Address:

6750 Poplar Avenue

Suite 109

Germantown, TN 38138

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

TEXAS CAPITAL BANK, NATIONAL ASSOCIATION, as a lender

 	 
	 	By:  	/s/ Mike McConnell
 	 
	 	 	Name:  	Mike McConnell 	 
	 	 	Title:  	Senior Vice President 	 
	 

Address:

114 West 7th Street

Suite 300

Austin, TX 78701

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

GOLDMAN SACHS BANK USA, as a lender

 	 
	 	By:  	/s/ Rick Canonico
 	 
	 	 	Name:  	Rick Canonico 	 
	 	 	Title:  	Authorized Signatory 	 
	 

Address:

200 West Street

New York, NY 10282

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

UNITED FCS, PCA, d/b/a FCS COMMERCIAL FINANCE GROUP, successor in interest to

AgCountry Farm Credit Services, PCA, d/b/a FCS Commercial Financial [sic]
Group, as a lender

 	 
	 	By:  	/s/ Lisa Caswell
 	 
	 	 	Name:  	Lisa Caswell 	 
	 	 	Title:  	Vice President 	 
	 

Address:

600 Highway 169 South

Suite 850

Minneapolis, MN 55426

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, as a lender

 	 
	 	By:  	/s/ Joe Carroll
 	 
	 	 	Name:  	Joe Carroll 	 
	 	 	Title:  	Senior Vice President 	 
	 

Address:

221 West 6th Street

2nd Floor

Austin, TX 78701

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

EATON VANCE FLOATING-RATE INCOME TRUST, as a lender

 	 
	 	By:  	EATON VANCE MANAGEMENT, as 
Investment Advisor
 	 
	 	 	 
	 	By:  	/s/ Michael Botthof
 	 
	 	 	Name:  	Michael Botthof 	 
	 	 	Title:  	Vice President 	 
	 

Address:

2 International Place

9th Floor

Boston, MA 02110

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

EATON VANCE INSTITUTIONAL SENIOR
 LOAN FUND, as a lender

 	 
	 	By:  	EATON VANCE MANAGEMENT, as 
Investment Advisor
 	 
	 	 	 
	 	By:  	/s/ Michael Botthof
 	 
	 	 	Name:  	Michael Botthof 	 
	 	 	Title:  	Vice President 	 
	 

Address:

2 International Place

9th Floor

Boston, MA 02110

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

EATON VANCE LIMITED DURATION INCOME FUND, as a lender

 	 
	 	By:  	EATON VANCE MANAGEMENT, as
 Investment Advisor
 	 
	 	 	 
	 	By:  	/s/ Michael Botthof
 	 
	 	 	Name:  	Michael Botthof 	 
	 	 	Title:  	Vice President 	 
	 

Address:

2 International Place

9th Floor

Boston, MA 02110

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

EATON VANCE SENIOR FLOATING-RATE TRUST, as a lender

 	 
	 	By:  	EATON VANCE MANAGEMENT, as
 Investment Advisor
 	 
	 	 	 
	 	By:  	/s/ Michael Botthof
 	 
	 	 	Name:  	Michael Botthof 	 
	 	 	Title:  	Vice President 	 
	 

Address:

2 International Place

9th Floor

Boston, MA 02110

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

GRAYSON & CO, as a lender

 	 
	 	By:  	BOSTON MANAGEMENT AND RESEARCH, 
as Investment Advisor
 	 
	 	 	 
	 	By:  	/s/ Michael Botthof
 	 
	 	 	Name:  	Michael Botthof 	 
	 	 	Title:  	Vice President 	 
	 

Address:

2 International Place

9th Floor

Boston, MA 02110

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

 

 

	 	 	 	 	 
	 	[Execution Continued]

SENIOR DEBT PORTFOLIO, as a lender

 	 
	 	By:  	BOSTON MANAGEMENT AND RESEARCH, 
as Investment Advisor
 	 
	 	 	 
	 	By:  	/s/ Michael Botthof
 	 
	 	 	Name:  	Michael Botthof 	 
	 	 	Title:  	Vice President 	 
	 

Address:

2 International Place

9th Floor

Boston, MA 02110

[SIGNATURE CONTINUED ON THE FOLLOWING PAGE]

Second Amendment to Forestar A&R Credit Agreement

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