Document:

Exhibit 10.2

 

Execution Version

 

CUSIP NUMBER: 11823LAE5

	
 
    

 

 

TERM LOAN AGREEMENT

 

dated as of September 30, 2016

 

among

 

BUCKEYE PARTNERS, L.P., as Borrower

 

THE LENDERS FROM TIME TO TIME PARTY HERETO

 

and

 

SUNTRUST BANK,

as Administrative Agent

 

	
 
    

 

 

SUNTRUST ROBINSON HUMPHREY, INC., JPMORGAN CHASE BANK, N.A.,

WELLS FARGO SECURITIES, LLC and BARCLAYS BANK PLC,

as Joint Lead Arrangers and Joint Book Managers

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE I.   DEFINITIONS; CONSTRUCTION
    	
1
    
	
 
    	
 
    	
 
    
	
Section 1.1.
    	
Definitions
    	
1
    
	
Section 1.2.
    	
Reserved
    	
24
    
	
Section 1.3.
    	
Accounting Terms and   Determination
    	
24
    
	
Section 1.4.
    	
Terms Generally
    	
24
    
	
 
    	
 
    	
 
    
	
ARTICLE II.   AMOUNT AND TERMS OF THE COMMITMENTS
    	
25
    
	
 
    	
 
    	
 
    
	
Section 2.1.
    	
General Description of   Facilities
    	
25
    
	
Section 2.2.
    	
Delayed Draw Term Loans
    	
25
    
	
Section 2.3.
    	
Procedure for Borrowings
    	
25
    
	
Section 2.4.
    	
Reserved
    	
25
    
	
Section 2.5.
    	
Funding of Borrowings
    	
25
    
	
Section 2.6.
    	
Interest Elections
    	
26
    
	
Section 2.7.
    	
Optional Reduction and   Termination of Commitments
    	
27
    
	
Section 2.8.
    	
Repayment of Loans
    	
27
    
	
Section 2.9.
    	
Evidence of Indebtedness
    	
28
    
	
Section 2.10.
    	
Optional Prepayments
    	
28
    
	
Section 2.11.
    	
Reserved
    	
28
    
	
Section 2.12.
    	
Interest on Loans
    	
29
    
	
Section 2.13.
    	
Fees
    	
29
    
	
Section 2.14.
    	
Computation of Interest and   Fees
    	
30
    
	
Section 2.15.
    	
Inability to Determine Interest   Rates
    	
30
    
	
Section 2.16.
    	
Illegality
    	
30
    
	
Section 2.17.
    	
Increased Costs
    	
31
    
	
Section 2.18.
    	
Funding Indemnity
    	
32
    
	
Section 2.19.
    	
Taxes
    	
32
    
	
Section 2.20.
    	
Payments Generally; Pro Rata   Treatment; Sharing of Set-offs
    	
34
    
	
Section 2.21.
    	
Mitigation of Obligations
    	
36
    
	
Section 2.22.
    	
Replacement of Lenders
    	
36
    
	
Section 2.23.
    	
Defaulting Lenders
    	
37
    
	
Section 2.24.
    	
Extension of Maturity Date
    	
37
    
	
Section 2.25.
    	
Acknowledgement and Consent to   Bail-In of EEA Financial Institutions
    	
38
    
	
 
    	
 
    	
 
    
	
ARTICLE III.   CONDITIONS PRECEDENT TO LOANS
    	
39
    
	
 
    	
 
    	
 
    
	
Section 3.1.
    	
Conditions to Effectiveness
    	
39
    
	
Section 3.2.
    	
Conditions to Each Credit Event
    	
40
    

 

 

	
ARTICLE IV.   REPRESENTATIONS AND WARRANTIES
    	
41
    
	
 
    	
 
    	
 
    
	
Section 4.1.
    	
Existence; Power
    	
41
    
	
Section 4.2.
    	
Organizational Power;   Authorization
    	
41
    
	
Section 4.3.
    	
Governmental Approvals; No   Conflicts
    	
41
    
	
Section 4.4.
    	
Financial Statements
    	
41
    
	
Section 4.5.
    	
Litigation and Environmental   Matters
    	
42
    
	
Section 4.6.
    	
Compliance with Laws and   Agreements
    	
42
    
	
Section 4.7.
    	
Investment Company Act
    	
42
    
	
Section 4.8.
    	
Taxes
    	
42
    
	
Section 4.9.
    	
Margin Regulations
    	
42
    
	
Section 4.10.
    	
ERISA
    	
42
    
	
Section 4.11.
    	
Ownership of Property
    	
43
    
	
Section 4.12.
    	
Disclosure
    	
43
    
	
Section 4.13.
    	
Sanctions and Anti-Corruption   Laws
    	
44
    
	
Section 4.14.
    	
Patriot Act
    	
44
    
	
 
    	
 
    	
 
    
	
ARTICLE V.   AFFIRMATIVE COVENANTS
    	
44
    
	
 
    	
 
    	
 
    
	
Section 5.1.
    	
Financial Statements and Other   Information
    	
44
    
	
Section 5.2.
    	
Notices of Material Events
    	
46
    
	
Section 5.3.
    	
Existence; Conduct of Business
    	
47
    
	
Section 5.4.
    	
Compliance with Laws
    	
47
    
	
Section 5.5.
    	
Payment of Obligations
    	
47
    
	
Section 5.6.
    	
Books and Records
    	
47
    
	
Section 5.7.
    	
Visitation and Inspection
    	
47
    
	
Section 5.8.
    	
Maintenance of Properties; Insurance
    	
47
    
	
Section 5.9.
    	
Use of Proceeds
    	
48
    
	
Section 5.10.
    	
Unrestricted Subsidiaries
    	
48
    
	
 
    	
 
    	
 
    
	
ARTICLE VI.   FINANCIAL COVENANTS
    	
48
    
	
 
    	
 
    	
 
    
	
Section 6.1.
    	
Leverage Ratio
    	
48
    
	
 
    	
 
    	
 
    
	
ARTICLE VII.   NEGATIVE COVENANTS
    	
49
    
	
 
    	
 
    	
 
    
	
Section 7.1.
    	
Liens
    	
49
    
	
Section 7.2.
    	
Fundamental Changes
    	
50
    
	
Section 7.3.
    	
Restricted Payments
    	
50
    
	
Section 7.4.
    	
Transactions with Affiliates
    	
50
    
	
Section 7.5.
    	
Restrictive Agreements
    	
51
    
	
Section 7.6.
    	
Accounting Changes
    	
51
    
	
Section 7.7.
    	
Government Regulation
    	
51
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII.   EVENTS OF DEFAULT
    	
51
    
	
 
    	
 
    	
 
    
	
Section 8.1.
    	
Events of Default
    	
51
    

 

ii

 

	
ARTICLE IX.   THE ADMINISTRATIVE AGENT
    	
54
    
	
 
    	
 
    	
 
    
	
Section 9.1.
    	
Appointment of Administrative   Agent
    	
54
    
	
Section 9.2.
    	
Nature of Duties of Administrative   Agent
    	
54
    
	
Section 9.3.
    	
Lack of Reliance on the   Administrative Agent
    	
54
    
	
Section 9.4.
    	
Certain Rights of the   Administrative Agent
    	
55
    
	
Section 9.5.
    	
Reliance by the Administrative   Agent
    	
55
    
	
Section 9.6.
    	
The Administrative Agent in its   Individual Capacity
    	
55
    
	
Section 9.7.
    	
Successor Administrative Agent
    	
55
    
	
Section 9.8.
    	
Withholding Tax
    	
56
    
	
Section 9.9.
    	
Administrative Agent   May File Proofs of Claim
    	
56
    
	
Section 9.10.
    	
Authorization to Execute other   Loan Documents
    	
57
    
	
 
    	
 
    	
 
    
	
ARTICLE X.   RESERVED
    	
57
    
	
 
    	
 
    	
 
    
	
ARTICLE XI.   MISCELLANEOUS
    	
57
    
	
 
    	
 
    	
 
    
	
Section 11.1.
    	
Notices
    	
57
    
	
Section 11.2.
    	
Waiver; Amendments
    	
59
    
	
Section 11.3.
    	
Expenses; Indemnification
    	
60
    
	
Section 11.4.
    	
Successors and Assigns
    	
62
    
	
Section 11.5.
    	
Governing Law; Jurisdiction;   Consent to Service of Process
    	
65
    
	
Section 11.6.
    	
WAIVER OF JURY TRIAL
    	
65
    
	
Section 11.7.
    	
Right of Setoff
    	
66
    
	
Section 11.8.
    	
Counterparts; Integration
    	
66
    
	
Section 11.9.
    	
Survival
    	
66
    
	
Section 11.10.
    	
Severability
    	
66
    
	
Section 11.11.
    	
Confidentiality
    	
66
    
	
Section 11.12.
    	
Interest Rate Limitation
    	
67
    
	
Section 11.13.
    	
Waiver of Effect of Corporate   Seal
    	
67
    
	
Section 11.14.
    	
Patriot Act
    	
67
    
	
Section 11.15.
    	
No Advisory or Fiduciary   Responsibility
    	
67
    
	
Section 11.16.
    	
Location of Closing
    	
68
    

 

iii

 

Schedules

 

	
Schedule I
    	
 
    	
Commitment Amounts
    
	
Schedule 7.5
    	
-
    	
Restrictive Agreements
    

 

Exhibits

 

	
Exhibit A
    	
-
    	
Form of Assignment   and Acceptance
    
	
Exhibit B-1
    	
-
    	
Restricted Subsidiaries
    
	
Exhibit B-2
    	
-
    	
Unrestricted   Subsidiaries
    
	
 
    	
 
    	
 
    
	
Exhibit 2.3
    	
-
    	
Form of Notice of   Borrowing
    
	
Exhibit 2.6
    	
-
    	
Form of Notice of   Conversion/Continuation
    
	
Exhibit 3.1(b)(ii)
    	
-
    	
Form of   Secretary’s Certificate
    
	
Exhibit 3.1(b)(v)
    	
-
    	
Form of Officer’s   Certificate
    
	
Exhibit 5.1(c)
    	
-
    	
Form of Compliance   Certificate
    

 

iv

 

TERM LOAN AGREEMENT

 

THIS TERM LOAN AGREEMENT (this “Agreement”) is made and entered into as of September 30, 2016, by and among BUCKEYE PARTNERS, L.P., a limited partnership formed under the laws of the State of Delaware (the “Borrower” or “BPL”), the several banks and other financial institutions and lenders from time to time party hereto (the “Lenders”) and SUNTRUST BANK, in its capacity as administrative agent for the Lenders (the “Administrative Agent”).

 

W I T N E S S E T H:

 

WHEREAS, the Borrower has requested that the Lenders establish a $250,000,000 delayed draw term loan credit facility in favor of BPL;

 

WHEREAS, subject to the terms and conditions of this Agreement, the Lenders, to the extent of their respective Commitments as defined herein, are willing severally to establish the requested delayed draw term loan credit facility in favor of the Borrower;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the Borrower, the Lenders and the Administrative Agent agree as follows:

 

ARTICLE I.

 

DEFINITIONS; CONSTRUCTION

 

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

 

“Acquisition” shall mean the acquisition by any Person of the Equity Interests of another Person (other than an existing wholly-owned Subsidiary of such Person), or one or more assets, operating lines, businesses or divisions of another Person (other than an existing Subsidiary of such Person), in each case, whether through purchase, merger or other business combination or transaction.

 

“Adjusted LIBO Rate” shall mean, with respect to each Interest Period for a Eurodollar Borrowing or Base Rate Borrowing accruing interest pursuant to clause (iii) of the definition of Base Rate, the rate per annum obtained by dividing (i) LIBOR for such Interest Period by (ii) a percentage equal to 1.00 minus the Eurodollar Reserve Percentage. If the Adjusted LIBO Rate as of any date of determination is less than zero percent per annum, then such rate shall be deemed to be zero percent (0.0%) per annum for purposes of this Agreement.

 

“Administrative Agent” shall have the meaning set forth in the introductory paragraph hereof.

 

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

 

“Affiliate” shall mean, as to any Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such Person.  For the purposes of this definition, “Control” shall mean the power, directly or indirectly, to direct or cause the direction of the management and policies of a Person, whether through the ability to exercise voting power, by control or otherwise.  The terms “Controlling”, “Controlled by”, and “under common Control with” have the meanings correlative thereto.

 

 

“Aggregate Commitment Amount” shall mean the aggregate principal amount of the Aggregate Commitments from time to time.  On the Closing Date, the Aggregate Commitment Amount is $250,000,000.

 

“Aggregate Commitments” shall mean, collectively, all Commitments of all Lenders at any time outstanding.

 

“Agreement” shall have the meaning set forth in the introductory paragraph hereof.

 

“Anti-Corruption Laws” shall mean all laws, rules and regulations of any jurisdiction applicable to the Borrower and any Subsidiary of the Borrower from time to time concerning or relating to bribery, corruption or money laundering including, without limitation, the United States Foreign Corrupt Practices Act of 1977, as amended.

 

“Anti-Terrorism Order” shall mean Executive Order 13224, signed by President George W. Bush on September 23, 2001.

 

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

 

“Applicable Margin” shall mean, as of any date, with respect to interest on all Loans outstanding on such date, the percentage per annum determined by reference to the applicable Rating Category from time to time in effect as set forth in the pricing grid below (the “Pricing Grid”); provided that a change in the Applicable Margin resulting from a change in the Rating Category shall be effective on the day on which either rating agency changes its rating and shall continue until the day prior to the day that a further change becomes effective.  Notwithstanding the foregoing, the Applicable Margin from the Closing Date until the date by which the financial statements and Compliance Certificate for the Fiscal Quarter ending September 30, 2016 are required to be delivered shall be at Level III in the Pricing Grid.

 

Pricing Grid

 

	
Pricing
   Level
    	
 
    	
Rating
   Category
    	
 
    	
Applicable Margin
   for Eurodollar
   Loans
    	
 
    	
Applicable Margin
   for Base Rate Loans
    	
 
    	
Applicable
   Percentage for
   Ticking Fee
    
	
I
    	
 
    	
BBB+ or higher / Baa1 or higher
    	
 
    	
1.00% 
   per annum
    	
 
    	
0.00% 
   per annum
    	
 
    	
0.125% 
   per annum
    
	
II
    	
 
    	
BBB / Baa2
    	
 
    	
1.10% 
   per annum
    	
 
    	
0.10 
   per annum
    	
 
    	
0.175% 
   per annum
    
	
III
    	
 
    	
BBB- /Baa3
    	
 
    	
1.35% 
   per annum
    	
 
    	
0.35% 
   per annum
    	
 
    	
0.225% 
   per annum
    
	
IV
    	
 
    	
Lower than BBB- / lower than Baa3
    	
 
    	
1.60% 
   per annum
    	
 
    	
0.60% 
   per annum
    	
 
    	
0.275% 
   per annum
    

 

The credit ratings to be utilized for purposes of the Pricing Grid are those assigned to the senior, unsecured long-term debt securities of BPL without third-party credit enhancement, whether or not any such debt securities are actually outstanding, and any rating assigned to any other debt security of

 

2

 

BPL shall be disregarded.  The rating in effect on any date is that in effect at the close of business on such date.  If BPL is split-rated and (1) the ratings differential is one category, the higher of the two ratings will apply (e.g., BBB+/Baa2 results in Level I status), (2) the ratings differential is two categories, the rating which falls between them shall apply (e.g., BBB+/Baa3 results in Level II status) or (3) the ratings differential is three categories, the rate shall be determined by reference to the category immediately below that of the higher of the two ratings (e.g., BBB+/Ba1, then the rate would be based on Level II status).  If neither Moody’s nor S&P has a rating for BPL, then the rate shall be established by reference to Level IV.

 

If the rating system of Moody’s or S&P shall change, or if either rating agency shall cease to be in the business of rating corporate debt obligations (either such condition, a “Rating System Alteration”), the Borrower, the Lenders and the Administrative Agent shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such rating agency and, pending the effectiveness of any such amendment, the Applicable Margin and the Applicable Percentage shall be determined by reference to the rating most recently in effect prior to any such change or cessation.  If the rating system of both Moody’s and S&P shall be subject to a Rating System Alteration, and after a reasonable time the parties cannot agree to a mutually acceptable amendment with respect to Moody’s rating system and cannot agree to a mutually acceptable amendment with respect to S&P’s rating system, the Applicable Margin and the Applicable Percentage shall be determined by reference to Level IV.

 

“Applicable Percentage” shall mean, as of any date, with respect to the Ticking Fee as of such date, the percentage per annum determined by reference to the applicable Rating Category as set forth in the Pricing Grid; provided that a change in the Applicable Percentage resulting from a change in the Rating Category shall be effective on the day on which either rating agency changes its rating and shall continue until the day prior to the day that a further change becomes effective.  Notwithstanding the foregoing, the Applicable Percentage for the Ticking Fee from the Closing Date until the date by which the financial statements and Compliance Certificate for the Fiscal Quarter ending September 30, 2016 are required to be delivered shall be at Level III in the Pricing Grid.

 

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

 

“Assignment and Acceptance” shall mean an assignment and acceptance entered into by a Lender and an assignee (with the consent of any Person whose consent is required by Section 11.4(b)) and accepted by the Administrative Agent, in the form of Exhibit A attached hereto or any other form approved by the Administrative Agent.

 

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

 

“Bahamas Group” shall mean Baproven Ltd., a Bahamian corporation, and its Subsidiaries.

 

“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

 

“Bail-In Legislation” shall mean, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

 

3

 

“Base Rate” shall mean the highest of (i) the rate which the Administrative Agent announces from time to time as its prime lending rate, as in effect from time to time, (ii) the Federal Funds Rate, as in effect from time to time, plus one-half of one percent (0.50%) per annum and (iii) the Adjusted LIBO Rate determined on a daily basis for an Interest Period of one (1) month, plus one percent (1.00%) per annum (any changes in such rates to be effective as of the date of any change in such rate).  The Administrative Agent’s prime lending rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer.  The Administrative Agent may make commercial loans or other loans at rates of interest at, above, or below the Administrative Agent’s prime lending rate.

 

“BES” shall have the meaning set forth in the definition of “Buckeye Merchant Services Companies”.

 

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

 

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

 

“BPL” shall have the meaning set forth in the introductory paragraph hereof.

 

“Buckeye Merchant Service Companies” shall mean, collectively, Buckeye Energy Services LLC, a limited liability company formed under the laws of the State of Delaware (“BES”), Buckeye Caribbean Terminals LLC, a limited liability company formed under the laws of the Commonwealth of Puerto Rico and Buckeye West Indies Holdings LP, a limited partnership formed under the laws of the Cayman Islands.

 

“Buckeye Partnership Agreement” shall mean the Amended and Restated Agreement of Limited Partnership of BPL dated as of November 19, 2010, as amended by that certain Amendment No. 1 to Amended and Restated Agreement of Limited Partnership of BPL dated as of January 18, 2011, Amendment No. 2 to Amended and Restated Agreement of Limited Partnership of BPL dated as of February 21, 2013, Amendment No. 3 to Amended and Restated Agreement of Limited Partnership of BPL dated as of October 1, 2013, Amendment No. 4 to Amended and Restated Agreement of Limited Partnership dated as of September 29, 2014 and as the same may be further amended from time to time after the date hereof as permitted by this Agreement.

 

“Business Day” shall mean any day other than (i) a Saturday, Sunday or other day on which commercial banks in Atlanta, Georgia or New York, New York are authorized or required by law to close and (ii) if such day relates to a Borrowing of, a payment or prepayment of principal or interest on, a conversion of or into, or an Interest Period for, a Eurodollar Loan or a notice with respect to any of the foregoing, any day on which banks are not open for dealings in Dollar deposits in the London interbank market.

 

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

 

“Change in Control” shall mean, (a) any Person or “group” (within the meaning of the Exchange Act and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof) shall own and control, beneficially and of record, directly or indirectly, a number of “LP Units” (as defined in the Buckeye Partnership Agreement) that would entitle such person or group to vote LP Units representing, in the aggregate, more than 50% of the total number of outstanding LP Units that are entitled to vote and be counted for purposes of calculating the required votes and that are deemed to

 

4

 

be outstanding for purposes of determining a quorum at any annual meeting of the limited partners of BPL or otherwise in the election of “Public Directors” (as defined in the Buckeye Partnership Agreement) of the General Partner; or (b) Continuing Directors cease for any reason to constitute collectively a majority of the members of the board of directors of the General Partner then in office; or (c) BPL shall cease to own and control, beneficially and of record, directly or indirectly, all of the outstanding member or other equity interests in the General Partner or (d) a “Change in Control” (as defined in the Revolving Credit Agreement) shall occur.  As used herein, “beneficially own” or words of similar import shall have the meaning provided in Rule 13d-3 of the Exchange Act, as amended, or any successor provision thereto; provided, however, that, for purposes of this definition, a Person shall not be deemed to beneficially own securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person’s Affiliates until such tendered securities are accepted for purchase or exchange pursuant to such offer.

 

“Change in Law” shall mean (i) the adoption of any applicable law, rule or regulation after the date of this Agreement, (ii) any change in any applicable law, rule or regulation, or any change in the interpretation, implementation or application thereof, by any Governmental Authority after the date of this Agreement, or (iii) compliance by any Lender (or its Applicable Lending Office) (or, for purposes of Section 2.17(b), by the Parent Company of such Lender, if applicable) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement; provided, that for purposes of this Agreement, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives 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 or foreign 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, implemented or issued.

 

“Charges” shall have the meaning set forth in Section 11.12.

 

“Closing Date” shall mean the date on which the conditions precedent set forth in Section 3.1 and Section 3.2 have been satisfied or waived in accordance with Section 11.2.

 

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

 

“Commercial Operation Date” shall mean the date on which a Material Project is substantially complete and commercially operable.

 

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

 

“Commitment Termination Date” shall mean, with respect to the Commitment of any Lender, the earliest of (i) December 30, 2016, (ii) the date on which all Commitments have been funded pursuant to Section 2.2, (iii) the date on which the Commitments are terminated pursuant to Section 2.7, and (iv) the date on which all amounts outstanding under this Agreement have been declared or have automatically become due and payable (whether by acceleration or otherwise).

 

“Compliance Certificate” shall mean a certificate from a Responsible Officer of BPL in the form of, and containing the certifications set forth in, the certificate attached hereto as Exhibit 5.1(c).

 

5

 

“Consolidated Adjusted EBITDA” shall mean, for any period, (i) Consolidated EBITDA for such period calculated as if the Unrestricted Subsidiaries are not Subsidiaries of the Borrower and are not consolidated into the financial performance of BPL and its Restricted Subsidiaries, plus (ii) without duplication, dividends and distributions paid in cash by Unrestricted Subsidiaries to the Borrower or any Restricted Subsidiaries during such period.

 

“Consolidated EBITDA” shall mean, for BPL and its Subsidiaries for any period, an amount equal to the sum of (i) Consolidated Net Income for such period plus (ii) to the extent deducted in determining Consolidated Net Income for such period, without duplication, (A) Consolidated Interest Expense, (B) income or franchise tax expense determined on a consolidated basis in accordance with GAAP, (C) depreciation, depletion and amortization expense (including amortization of goodwill) determined on a consolidated basis in accordance with GAAP, (D) non-cash unit-based equity expense for or to employees or board members incurred during the period, (E) any extraordinary, nonrecurring or unusual charges or losses, (F) all other non-cash charges or losses determined on a consolidated basis in accordance with GAAP (including any impairment charges, write-downs or write-offs, any charges resulting from the application of fair value accounts and any charges resulting from the application of purchasing accounting or changes in accounting principles), and (G) the amount of charges, fees or expenses associated with any Indebtedness, including in connection with the repurchase or repayment thereof, including any premium and acceleration of fees or discounts and other expenses, in each case for such period, minus (iii) to the extent included in determining Consolidated Net Income for such period (A) Federal, state, local and foreign income and franchise tax credits of BPL and its Subsidiaries, (B) all extraordinary, nonrecurring or unusual gains, (C) all non-cash items increasing Consolidated Net Income and (D) any cash payments made during such period in respect of items described in clause (ii)(F) above subsequent to the Fiscal Quarter in which the relevant non-cash charges or losses were reflected as a charge in determining Consolidated Net Income; provided, that, only for purposes of determining compliance with the requirements set forth in Section 3.2(c) and Section 6.1, if, since the beginning of the period ending on the date for which Consolidated EBITDA is determined, BPL or any Subsidiary shall have made any asset disposition or acquisition, shall have consolidated or merged with or into any Person (other than the Borrower or a Subsidiary), or shall have made any disposition or acquisition of a Subsidiary or of any partial ownership interest in any other Person, Consolidated EBITDA shall be calculated giving pro forma effect thereto (as reasonably diligenced by BPL) as if the disposition, acquisition, consolidation or merger had occurred on the first day of such period, and such calculation shall be determined in good faith by a financial officer of BPL (and BPL will provide to the Administrative Agent such supporting information as Administrative Agent may reasonably request).

 

“Consolidated Funded Debt” shall mean, as of any date, all Indebtedness of BPL and its Restricted Subsidiaries of the type described in subsections (i), (ii), (iv), (v), (vi), (viii) and (x) of the definition of “Indebtedness”, and Guarantees by BPL and its Restricted Subsidiaries of the foregoing types of Indebtedness, measured as of such date on a consolidated basis, and in any event including any amount Guaranteed by the Borrower or its Restricted Subsidiaries for the benefit of Unrestricted Subsidiaries in accordance with Section 5.10(b).

 

“Consolidated Interest Expense” shall mean, for BPL and its Subsidiaries for any period, determined on a consolidated basis in accordance with GAAP, total interest expense, including, without limitation, the interest component of any payments in respect of Capital Lease Obligations, expensed during such period (whether or not actually paid during such period) including amortization, write-off or write-down of debt discount, capitalized interest and debt issuance costs and commissions, discounts and other fees, charges and expenses associated with any letters of credit or Indebtedness, including in connection with the repurchase or repayment thereof, including any premium and acceleration of fees or discounts and other expenses.

 

“Consolidated Net Income” shall mean, for BPL and its Subsidiaries for any period, the net income (or loss) of BPL and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from Consolidated Net Income (to the

 

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extent otherwise included therein) (i) the net income (but not loss) of any Subsidiary of such Person to the extent that the declaration or payment of dividends or similar distributions or transfers or loans by that Subsidiary is at the time prohibited by operation of the terms of its charter or any agreement, instrument or Governmental Requirement applicable to such Subsidiary, or otherwise in each case determined in accordance with GAAP; and (ii) any equity interest of BPL or any of its Subsidiaries in the unremitted earnings of any Person that is not a Subsidiary, except to the extent of the amount of dividends or distributions actually paid in such period by such other Person to BPL or any of its Subsidiaries. Notwithstanding clause (ii) above, the Consolidated Net Income attributable to the Bahamas Group shall not be excluded from Consolidated Net Income by virtue of such clause (ii), except that during any period starting with the 30th day after the applicable Governmental Authority has disapproved of the payment of a dividend or similar distribution intended to be made by the Bahamas Group (assuming such disapproval has not been withdrawn, reversed or superseded by an approval of such payment on or prior to such 30th day), and ending on the earlier of (A) the date that such disapproval has been withdrawn, reversed or superseded by an approval of such payment and (B) the date that the payment of another dividend or similar distribution by the Bahamas Group has been approved by the applicable Governmental Authority, the Consolidated Net Income attributable to the Bahamas Group, unless otherwise agreed to by the Required Lenders, shall be reduced immediately and in full, which reduction shall be effective until such period has concluded (it being understood that the Required Lenders may agree to reductions only in part or pursuant to a schedule).

 

“Consolidated Net Tangible Assets” shall mean as of any date of determination, the total assets of the Borrower and its Restricted Subsidiaries as set forth on a consolidated balance sheet of the Borrower and its Restricted Subsidiaries for its most recently completed Fiscal Quarter, prepared in accordance with GAAP, after deducting therefrom:  (a) all current liabilities, excluding (i) any current liabilities that by their terms are extendable or renewable at the option of the obligor thereon to a time more than 12 months after the time as of which the amount thereof is being computed, and (ii) current maturities of long-term debt; and (b) the book value (net of any applicable reserves and accumulated amortization) of all goodwill, trade names, trademarks, patents and other like intangible assets, all as set forth, or on a pro forma basis would be set forth, on the consolidated balance sheet of the Borrower and the Restricted Subsidiaries for the Borrower’s most recently completed Fiscal Quarter, prepared in accordance with GAAP.

 

“Continuing Director” shall mean, as of any date, any member of the board of directors of the General Partner (A) (I) at any time during the first two years after the Closing Date, individuals who were members of such board of directors or other equivalent governing body as of the Closing Date or (II) thereafter, individuals who were members of such board of directors or other equivalent governing body two years prior to such time, (B) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (A) above (as applicable) constituting at the time of such election or nomination at least a majority of that board or equivalent governing body, or (C) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (A) and (B) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body.

 

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

 

“Declining Lender” shall have the meaning set forth in Section 2.24.

 

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

 

“Default Interest” shall have the meaning set forth in Section 2.12(b).

 

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“Defaulting Lender” shall mean, at any time, subject to Section 2.23(c), (i) any Lender that has failed for two (2) or more Business Days to comply with its obligations under this Agreement to make a Loan or to pay any other amount required to be paid by it hereunder (each a “funding obligation”) unless such Lender has notified the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s good faith determination that one or more conditions precedent to funding set forth in Sections 3.1 or 3.2 has not been satisfied (which conditions precedent, together with any applicable Default, will be specifically identified in such writing), (ii) any Lender that has notified the Borrower, the Administrative Agent or any other Lender in writing, or has stated publicly, that it does not intend to comply with any such funding obligation hereunder (unless such writing or public statement relates to such Lender’s funding obligations hereunder and states that such position is based on such Lender’s good faith determination that one or more conditions precedent to funding set forth in Sections 3.1 or 3.2 has not been satisfied (which conditions precedent, together with any applicable Default, have been specifically identified in such writing) cannot be satisfied), (iii) any Lender that has defaulted on its obligation to fund generally under any other loan agreement, credit agreement or other financing agreement, (iv) any Lender that has, for three (3) or more Business Days after written request of the Administrative Agent or the Borrower, failed to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender will cease to be a Defaulting Lender pursuant to this clause (iv) upon the Administrative Agent’s and the Borrower’s receipt of such written confirmation) or (v) any Lender with respect to which a Lender Insolvency Event has occurred and is continuing.  Any determination by the Administrative Agent that a Lender is a Defaulting Lender will be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.23(c)) upon notification of such determination by the Administrative Agent to the Borrower and the Lenders.

 

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

 

“EEA Financial Institution” shall mean (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent .

 

“EEA Member Country” shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” shall mean any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

“Eligible Inventory” shall mean (i) inventories of Petroleum Products in which the Buckeye Merchant Service Companies and their Subsidiaries have lawful and absolute title, which are not subject to any Lien in favor of any Person (other than Permitted Encumbrances), minus without duplication the amount of any Permitted Encumbrances on such inventory and (ii) inventory to be delivered to the Buckeye Merchant Service Companies for which title has not yet passed to the Buckeye Merchant Service Companies as of such date of determination, to the extent the Buckeye Merchant Service Companies have paid in cash the purchase price; provided that with respect to the inventory described in this clause (ii), (A) but for the passing of title to the Buckeye Merchant Service Companies, such inventory would fulfill the requirements of the immediately preceding clause (i), (B) the Buckeye Merchant Service Companies shall have the absolute and unqualified contractual right to obtain such inventory and (C) (i) the purchase price of such inventory must have been prepaid and (ii) such inventory must be scheduled to commence transfer of title of such inventory to the Buckeye Merchant Service Companies within three Business Days of the effective prepayment date.

 

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“Environmental Laws” shall mean all applicable laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by or with any Governmental Authority, relating to the environment, preservation or reclamation of natural resources, the management, Release or threatened Release of any Hazardous Material or to health and safety matters but only to the extent such health and safety matters arise out of exposure to Hazardous Materials, as now or hereafter in effect.

 

“Environmental Liability” shall mean any liability, contingent or otherwise (including any liability for damages, costs of environmental investigation and remediation, costs of administrative oversight, fines, natural resource damages, penalties or indemnities), of the Borrower or any Subsidiary resulting from or based upon (i) any actual or alleged violation of any Environmental Law, (ii) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (iii) any actual or alleged exposure to any Hazardous Materials, (iv) the Release or threatened Release of any Hazardous Materials or (v) any contract, agreement or other consensual arrangement in writing pursuant to which liability is assumed or imposed with respect to any of the foregoing.

 

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

 

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

 

“ERISA Affiliate” shall mean any person that for purposes of Title I or Title IV of ERISA or Section 412 of the Code would be deemed at any relevant time to be a “single employer” or otherwise aggregated with the Borrower or any of its Subsidiaries under Section 414(b), (c), (m) or (o) of the Code or Section 4001 of ERISA.

 

“ERISA Event” shall mean (i) any “reportable event”, as defined in Section 4043 of ERISA with respect to a Plan (other than an event as to which the PBGC has waived under subsection .22, .23, .25, .27 or .28 of PBGC Regulation Section 4043 (as in effect on the date hereof) the requirement of Section 4043(a) of ERISA that it be notified of such event); (ii) any failure to make a required contribution to any Plan that would result in the imposition of a lien or other encumbrance or the provision of security under Section 430 of the Code or Section 303 or 4068 of ERISA, or the arising of such a lien or encumbrance, there being or arising any “unpaid minimum required contribution” or failure to satisfy the minimum funding standard set forth in Section 412 of the Code and Section 303 of ERISA, whether or not waived, or any filing of any request for or receipt of a minimum funding waiver under Section 412 of the Code or Section 303 of ERISA with respect to any Plan or Multiemployer Plan, or that such filing may be made, or any determination that any Plan is, or is expected to be, in at-risk status under Title IV of ERISA; (iii) any incurrence by the Borrower, any of its Subsidiaries or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to any Plan or Multiemployer Plan (other than for premiums due and not delinquent under Section 4007 of ERISA); (iv) any institution of proceedings, or the occurrence of an event or condition which would reasonably be expected to constitute grounds for the institution of proceedings by the PBGC, under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan; (v) any incurrence by the Borrower, any of its Subsidiaries or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan, or the receipt by the Borrower, any of its Subsidiaries or any of its ERISA Affiliates of any notice that a Multiemployer Plan is in endangered or critical status under Section 305 of ERISA; (vi) any receipt by the Borrower, any of its Subsidiaries or any of its ERISA Affiliates of any notice, or any receipt by any Multiemployer Plan from the Borrower, any of its

 

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Subsidiaries or any of its ERISA Affiliates of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA; (vii) engaging in a non-exempt prohibited transaction within the meaning of Section 4975 of the Code or Section 406 of ERISA; or (viii) any filing of a notice of intent to terminate any Plan, if such termination would require material additional contributions in order to be considered a standard termination within the meaning of Section 4041(b) of ERISA, any filing under Section 4041(c) of ERISA of a notice of intent to terminate any Plan, or the termination of any Plan under Section 4041(c) of ERISA.

 

“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

 

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

 

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

 

“Event of Default” shall have the meaning set forth in Section 8.1.

 

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended and in effect from time to time.

 

“Excluded Taxes” shall mean, with respect to any 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 net income (however denominated), gross income or capital, franchise Taxes and branch profits or other similar Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its Applicable Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, and (b) any U.S. federal withholding Taxes that (i) are imposed on amounts payable to such Recipient pursuant to a Requirement of Law in effect on the date on which such Recipient becomes a Recipient under this Agreement (other than pursuant to an assignment request by the Borrower under Section 2.22) or designates a new lending office, except in each case to the extent that amounts with respect to such Taxes were payable either (A) to such Recipient’s assignor immediately before such Recipient became a Recipient under this Agreement, or (B) to such Recipient immediately before it designated a new lending office, (ii) are attributable to such Recipient’s failure to comply with Section 2.19(e), or (iii) are imposed under FATCA.

 

“Executive Summary” shall mean the Executive Summary dated September 2016 relating to the Borrower and the transactions contemplated by this Agreement and the other Loan Documents.

 

“Extending Lender” shall have the meaning set forth in Section 2.24.

 

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“Extension Effective Date” shall have the meaning set forth in Section 2.24.

 

“Extension Request Date” shall have the meaning set forth in Section 2.24.

 

“FATCA” shall mean Sections 1471 through 1474 of the Code as of the date of this Agreement (or any amended or successor version that is substantially comparable) and any current or future regulations or official interpretations thereof, and any agreements entered into pursuant to Section 1471(b) of the Code.

 

“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with member banks of the Federal Reserve System as published by the Federal Reserve Bank of New York on the next succeeding Business Day or, if such rate is not so published for any Business Day, the Federal Funds Rate for such day shall be the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day on such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by the Administrative Agent.  If the Federal Funds Rate as of any date of determination is less than zero percent per annum, then such rate shall be deemed to be zero percent (0.0%) per annum for purposes of this Agreement.

 

“Fee Letter” shall mean that certain fee letter, dated as of September 2, 2016, executed by SunTrust Robinson Humphrey, Inc. and SunTrust Bank and accepted by BPL.

 

“Fiscal Quarter” shall mean any fiscal quarter of BPL.

 

“Fiscal Year” shall mean any fiscal year of BPL.

 

“Foreign Person” shall mean any Person that is not a U.S. Person.

 

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

 

“General Partner” shall mean Buckeye GP LLC, a Delaware limited liability company, or any other Restricted Subsidiary that is admitted to BPL as general partner of BPL, in its capacity as general partner of BPL.

 

“General Partner LLC Agreement” shall mean the Third Amended and Restated Limited Liability Company Agreement of the General Partner dated as of November 19, 2010, as amended by that certain Amendment No. 1 to Third Amended and Restated Limited Liability Company Agreement of the General Partner dated as of May 2, 2013 and as the same may be amended from time to time as permitted by this Agreement.

 

“Governmental Authority” shall mean the government of the United States, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

 

“Governmental Requirement” shall mean any law, statute, code, ordinance, order, determination, executive order, rule, regulation, judgment, decree, injunction, franchise, permit, certificate, license, authorization or other directive or requirement (whether or not having the force of law), including, without limitation, Environmental Laws, energy regulations and occupational, safety and health standards or controls, of any Governmental Authority.

 

“Guarantee” of or by any Person (the “guarantor”) shall mean any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any

 

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

 

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

 

“Hedged Eligible Inventory” shall mean Eligible Inventory with respect to which the value has been effectively hedged on a net hedge basis for delivery within the next 180 days by either (i) a NYMEX contract or an over-the-counter contract, or (ii) a contract for physical delivery to a counterparty on a written list of counterparties provided by the Borrower from time to time to the Administrative Agent (and updated at least once per Fiscal Quarter) but excluding any such counterparties on such written list that have been affirmatively rejected by the Administrative Agent in its reasonable discretion; provided, however, that Petroleum Products that would constitute Hedged Eligible Inventory except that such inventory has been hedged for delivery within the next 365 days but more than 180 days out (the “Long Term Hedged Inventory”) shall be included as Hedged Eligible Inventory to the extent such Long Term Hedged Inventory does not exceed 25% of the total Hedged Eligible Inventory.

 

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

 

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

 

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“Hybrid Equity Securities” shall mean, on any date (the “determination date”), any securities issued by BPL or a financing vehicle of BPL, other than common stock or limited partnership units, that meet the following criteria: (a) BPL demonstrates that such securities receive at least 50% equity credit from at least two Nationally Recognized Statistical Rating Organizations (NRSROs), and (b) such securities require no repayments or prepayments and no mandatory redemptions or repurchases, in each case, prior to at least 91 days after the later of the termination of the Commitments and the repayment in full of all Obligations. As used in this definition, “mandatory redemption” shall not include conversion of a security into common stock or limited partnership units.

 

“Increase Election” shall have the meaning set forth in Section 6.1.

 

“Indebtedness” of any Person shall mean, without duplication, (i) all obligations of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person in respect of the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of business and not overdue by more than 120 days), (iv) all obligations of such Person under any conditional sale or other title retention agreement(s) relating to property acquired by such Person, (v) all Capital Lease Obligations of such Person, (vi) all obligations, contingent or otherwise, of such Person in respect of letters of credit, acceptances or similar extensions of credit, (vii) all Guarantees of such Person of the type of Indebtedness described in clauses (i) through (vi) above, (viii) all Indebtedness of a third party secured by any Lien on property owned by such Person, whether or not such Indebtedness has been assumed by such Person, the amount of such Indebtedness being deemed to be the lesser of the fair market value (as determined reasonably and in good faith by such Person) of such property or assets and the amount of the Indebtedness so secured, (ix) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value any Equity Interests of such Person payable in cash, (x) all Off-Balance Sheet Liabilities, (xi) all Hedging Obligations, and (xii) any Indebtedness of a Special Entity for which such Person is liable either by agreement or because of a Governmental Requirement; provided however, that Indebtedness shall not include obligations under any operating lease of property that is not capitalized on the balance sheet of such Person other than pursuant to clause (x) above.  The Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venturer, except to the extent that the terms of such Indebtedness provide that such Person is not liable therefor.

 

“Indemnified Taxes” shall mean Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of the Borrower under any Loan Document.

 

“Indemnitee” shall have the meaning set forth in Section 11.3(b).

 

“Interest Period” shall mean with respect to any Eurodollar Borrowing, a period of one, two, three or six months (or 12 months or less than one month if available to all Lenders); provided that:

 

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

 

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

 

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

 

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month at the end of such Interest Period shall end on the last Business Day of such calendar month; and

 

(iv)                              no Interest Period may extend beyond the Maturity Date.

 

“Intermediate Investment Account” shall mean the deposit account no. 2079951076125 (or any successor account thereto) held in the name of the Borrower or Restricted Subsidiary holding (i) the proceeds of Accounts Receivable (as defined in the Revolving Credit Agreement) relating to Intermediate Investments and credit card purchases of transportation fuels from retail distributors that have received Intermediate Investments and (ii) funds transferred from time to time by the Borrower or any Restricted Subsidiary to pay operating expenses in the ordinary course; provided that, the oil companies that have provided the Intermediate Loans may have access and withdrawal rights with respect to such account.

 

“Intermediate Investments” shall mean loans and advances made by any Buckeye Merchant Service Company to retail distributors of transportation fuels in connection with the Intermediate Loans.

 

“Intermediate Loans” shall mean Indebtedness incurred by any Buckeye Merchant Service Company and owed to major oil companies to, among other things, make Intermediate Investments.

 

“Joint Lead Arrangers” shall mean SunTrust Robinson Humphrey, Inc., JPMorgan Chase Bank, N.A., Wells Fargo Securities, LLC and Barclays Bank PLC.

 

“Lender Insolvency Event” shall mean that (i) a Lender or its Parent Company is insolvent, or is generally unable to pay its debts as they become due, or admits in writing its inability to pay its debts as they become due, or makes a general assignment for the benefit of its creditors, (ii) a Lender or its Parent Company is the subject of a bankruptcy, insolvency, reorganization, liquidation or similar proceeding, or a receiver, trustee, conservator, custodian or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such capacity, has been appointed for such Lender or its Parent Company, or such Lender or its Parent Company has taken any action in furtherance of or indicating its consent to or acquiescence in any such proceeding or appointment, (iii) a Lender or its Parent Company has been adjudicated as, or determined by any Governmental Authority having regulatory authority over such Person or its assets to be, insolvent or (iv) a Lender or its Parent Company has become the subject of a Bail-in Action; provided that, for the avoidance of doubt, a Lender Insolvency Event shall not be deemed to have occurred solely by virtue of the ownership or acquisition of any equity interest in or control of a Lender or a Parent Company thereof by a Governmental Authority or an instrumentality thereof so long as such ownership or acquisition does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.

 

“Lenders” shall have the meaning set forth in the introductory paragraph hereof and shall include, where appropriate, each Additional Lender that joins this Agreement pursuant to Section 2.22.

 

“Leverage Ratio” shall mean, as of any date of determination, the ratio of (i) (A) Consolidated Funded Debt, minus (B) the lesser of (1) the BMSC Revolving Credit Exposure (as defined in the Revolving Credit Agreement) and (2) the sum of (x) 100% of Hedged Eligible Inventory, and (y) 75% of outstanding Eligible Accounts Receivable (as defined in the Revolving Credit Agreement) (provided, however, in no event shall the amount in clause (y) exceed 25% of the sum of clause (x) and (y)), minus (C) to the extent included in Consolidated Funded Debt, 100% of performance bonds issued by, and letter of credit reimbursement obligations incurred by, the Buckeye Merchant Service Companies

 

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(and guarantees thereof by BPL) with respect to fuel tax liabilities of the Buckeye Merchant Service Companies and obligations of the Buckeye Merchant Service Companies under product purchase and/or supply agreements, in an aggregate amount not to exceed $100,000,000, minus (D) 100% of Intermediate Loans not to exceed $5,000,000, minus (E) the principal amount of any bond issuance (so long as 100% of the net proceeds of such bond issuance are held by one or more borrowers under the Revolving Credit Agreement that are U.S. Persons, in cash or cash equivalents and such proceeds are not subject to any Liens other than Permitted Encumbrances) minus (F) the principal amount of Hybrid Equity Securities in an aggregate amount not to exceed 15% of Total Capitalization, in each case measured on a consolidated basis as of such date of determination to (ii) the sum of (A) Consolidated Adjusted EBITDA for the four Fiscal Quarter period ending on or immediately prior to such date for which financial statements are required to have been delivered under this Agreement and (B) Material Project EBITDA Adjustments, if any.

 

“LIBOR” shall mean, for any Interest Period with respect to a Eurodollar Borrowing, the interest rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBOR01 Page (or on any successor or substitute page of such service or any successor to such service, or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time)) as the London interbank offered rate for Dollar deposits at approximately 11:00 a.m. (London, England time) two (2) Business Days prior to the first day of such Interest Period with a maturity comparable to such Interest Period.  If for any reason such rate is not available at any such time for any reason, LIBOR for such Interest Period shall instead be the interest rate per annum reasonably determined by the Administrative Agent and disclosed to BPL in writing, to be the arithmetic average of the rates per annum at which deposits in U. S. Dollars in an amount equal to the amount of the Eurodollar Loans comprising part of such Borrowing are offered by major banks in the London interbank market to the Administrative Agent at approximately 11:00 a.m. (London, England time) two (2) Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period.

 

“Lien” shall mean any mortgage, pledge, security interest, lien (statutory or otherwise), charge, encumbrance, hypothecation, collateral assignment, deposit arrangement, or other arrangement having the practical effect of any of the foregoing (including any conditional sale, capital lease or other title retention agreement and any financing lease having the same economic effect as any of the foregoing).

 

“Loan Documents” shall mean, collectively, this Agreement, the Notes, the Fee Letter, all Notices of Borrowing, all Notices of Conversion/Continuation, all Compliance Certificates, and any and all other instruments, agreements and documents executed in connection with any of the foregoing.

 

“Loans” shall mean all loans made by a Lender to the Borrower pursuant to Section 2.1 under its Commitment, which may either be a Base Rate Loan or a Eurodollar Loan.

 

“Master Agreement” shall have the meaning set forth in the definition of “Hedging Transaction”.

 

“Material Acquisition” shall have the meaning set forth in Section 6.1.

 

“Material Adverse Effect” shall mean, with respect to any event, act, condition or occurrence of whatever nature (including any adverse determination in any litigation, arbitration, or governmental investigation or proceeding), whether singularly or in conjunction with any other event or events, act or acts, condition or conditions, occurrence or occurrences whether or not related, resulting in a material adverse change in, or a material adverse effect on, (i) the financial condition, business, operations, or properties of BPL and its Restricted Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform any of its obligations under this Agreement or Notes, (iii) the rights and remedies of

 

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the Administrative Agent or the Lenders under this Agreement or Notes or (iv) the legality, validity or enforceability of this Agreement or Notes.

 

“Material Indebtedness” shall mean any Indebtedness (other than the Loans) and Hedging Obligations of the Borrower or any Restricted Subsidiary, individually or in an aggregate committed or outstanding principal amount exceeding $75,000,000.  For purposes of determining the amount of attributed Indebtedness from Hedging Obligations, the “principal amount” of any Hedging Obligations at any time shall be the Net Mark-to-Market Exposure of such Hedging Obligations.

 

“Material Project” shall mean the construction or expansion of any capital project of the Borrower or any of its Restricted Subsidiaries, the aggregate capital cost of which is reasonably expected by BPL to exceed $20,000,000 (or such lesser amount as may be agreed by the Administrative Agent); provided that BPL may elect that one or more “phases” of a capital project or expansion be treated as an independent Material Project if (A) the aggregate capital cost of such “phase” is reasonably expected by BPL to exceed $10,000,000 (or such lesser amount as may be agreed by the Administrative Agent) and (B) the aggregate capital cost of such “phase”, together with all other “phases” of such capital project or expansion is reasonably expected by BPL to exceed $20,000,000 (or such lesser as may be agreed by the Administrative Agent).

 

“Material Project EBITDA Adjustments” shall mean, with respect to each Material Project:

 

(A)                           prior to the Commercial Operation Date of a Material Project (but including the Fiscal Quarter in which such Commercial Operation Date occurs), a percentage (equal to the then-current completion percentage of such Material Project) of an amount to be approved by the Administrative Agent as the projected Consolidated Adjusted EBITDA attributable to such Material Project for the first 12-month period following the scheduled Commercial Operation Date of such Material Project (such amount to be determined based on contracts or term sheets relating to such Material Project, the creditworthiness of the other parties to such contracts and term sheets, and projected revenues from such contracts and term sheets, capital costs and expenses, scheduled Commercial Operation Date (which shall be no later than 18 months after the last day of the first Fiscal Quarter for which such Material Project EBITDA Adjustments shall be included for purposes of calculating the Leverage Ratio), and other factors reasonably deemed appropriate by the Administrative Agent), which may, at the Borrower’s option, be included as “Material Project EBITDA Adjustments” for purposes of the Leverage Ratio for the Fiscal Quarter in which construction of such Material Project commences and for each Fiscal Quarter thereafter until the Commercial Operation Date of such Material Project (including the Fiscal Quarter in which such Commercial Operation Date occurs, but net of any actual Consolidated Adjusted EBITDA attributable to such Material Project following such Commercial Operation Date); provided that if the actual Commercial Operation Date does not occur by the scheduled Commercial Operation Date, then the foregoing amount shall be reduced, for Fiscal Quarters ending after the scheduled Commercial Operation Date to (but excluding) the first full Fiscal Quarter after its actual Commercial Operation Date, by the following percentage amounts depending on the period of delay (based on the period of actual delay or then-estimated delay, whichever is longer), but with any delay resulting from a force majeure event not counting as a delay for purposes of these time periods to the extent approved by the Administrative Agent:  (i) 90 days or less, 0%, (ii) longer than 90 days, but not more than 180 days, 25%, (iii) longer than 180 days but not more than 270 days, 50%, and (iv) longer than 270 days, 100%; and

 

(B)                               beginning with the first full Fiscal Quarter following the Commercial Operation Date of a Material Project and for the two immediately succeeding Fiscal Quarters, an amount to be approved by the Administrative Agent as the projected Consolidated Adjusted EBITDA attributable to such Material Project (determined in the same manner as set forth in clause (A) above) for the balance of the four full Fiscal Quarter period following such Commercial Operation Date, which may, at the Borrower’s option, be included as “Material Project EBITDA Adjustments” for purposes of the Leverage

 

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Ratio for such Fiscal Quarters (but net of any actual Consolidated Adjusted EBITDA attributable to such Material Project following such Commercial Operation Date).

 

Notwithstanding the foregoing:

 

(i)                                     no such additions shall be allowed with respect to any Material Project unless:

 

(a)                                 not later than 20 days (or such shorter period of time as the Administrative Agent shall agree) prior to the delivery of any certificate required by the terms and provisions of Section 5.1(a) or (b) to the extent Material Project EBITDA Adjustments will be made to Consolidated Adjusted EBITDA in determining compliance with Section 6.1, the Borrower shall have delivered to the Administrative Agent written pro forma projections of Consolidated Adjusted EBITDA attributable to such Material Project, and

 

(b)                                 prior to the date such certificate is required to be delivered, the Administrative Agent shall have approved (such approval not to be unreasonably withheld, conditioned or delayed) such projections and shall have received such other information and documentation as the Administrative Agent may reasonably request, all in form and substance reasonably satisfactory to the Administrative Agent, and

 

(ii)                                  the aggregate amount of all Material Project EBITDA Adjustments during any period shall be limited to 20% of the total actual Consolidated Adjusted EBITDA for such period (which total actual Consolidated Adjusted EBITDA shall be determined without including any Material Project EBITDA Adjustments); provided, that (i) the portion of all Material Project EBITDA Adjustments during any period that are based on term sheets rather than contracts shall be limited to 5% of the total actual Consolidated Adjusted EBITDA for such period (which total actual Consolidated Adjusted EBITDA shall be determined without including any Material Project EBITDA Adjustments) and (ii) no Material Project EBITDA Adjustments during any period that are based on term sheets shall continue to be included for more than 120 days (or such longer period of time as the Administrative Agent shall agree) after such term sheet is executed unless within such time period such term sheet is converted to a binding contract.

 

The parties hereto acknowledge and agree that the adjustments related to Material Projects reflected in the pro forma calculation of the Leverage Ratio delivered in connection with the initial Borrowing hereunder shall be deemed to be approved Material Project EBITDA Adjustments hereunder (including for the purposes of showing pro forma compliance with the Leverage Ratio pursuant to Section 3.2(c) on the Closing Date).

 

“Material Subsidiary” shall mean at any time any (x) borrower (other than BPL) under the Revolving Credit Agreement or (y) direct or indirect Restricted Subsidiary having: (a) assets in an amount equal to at least 10% of the total assets of BPL and its Restricted Subsidiaries determined on a consolidated basis as of the last day of the most recent Fiscal Quarter at such time; or (b) gross revenues or net income in an amount equal to at least 10% of the gross revenues or net income of BPL and its Restricted Subsidiaries on a consolidated basis for the 12-month period ending on the last day of the most recent Fiscal Quarter at such time.

 

“Maturity Date” shall mean, with respect to the Loan of any Lender, the earlier of (i) September 30, 2019 or such later date to which such Lender has agreed to extend its Loan pursuant to Section 2.24 and (ii) the date on which all amounts outstanding under this Agreement have been declared or have automatically become due and payable (whether by acceleration or otherwise).

 

“Maximum Rate” shall have the meaning set forth in Section 11.12.

 

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

 

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“Multiemployer Plan” shall mean any multiemployer plan as defined in Section 4001(a)(3) of ERISA, which is contributed to by (or to which there is or may be an obligation to contribute of) the Borrower or a Subsidiary or an ERISA Affiliate, and each such plan for the five-year period immediately following the latest date on which the Borrower, a Subsidiary or an ERISA Affiliate contributed to or had an obligation to contribute to such plan.

 

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

 

“New Lender” shall have the meaning set forth in Section 2.24.

 

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

 

“Notes” shall mean, collectively, any promissory note made by the Borrower in favor of a Lender evidencing Loans made by such Lender.

 

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

 

“Notice of Conversion/Continuation” shall have the meaning set forth in Section 2.6(b).

 

“Obligations” shall mean all amounts owing by the Borrower to the Administrative Agent, the Lenders and the Joint Lead Arrangers pursuant to or in connection with this Agreement or any other Loan Document or otherwise with respect to any Loan including, without limitation, all principal, interest (including any interest accruing after the filing of any petition in bankruptcy or the commencement of any insolvency, reorganization or like proceeding relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding), all reimbursement obligations, fees, expenses, indemnification and reimbursement payments, costs and expenses (including all reimbursable fees and expenses of counsel to the Administrative Agent and any Lender incurred pursuant to this Agreement or any other Loan Document), whether direct or indirect, absolute or contingent, liquidated or unliquidated, now existing or hereafter arising hereunder or thereunder, together with all renewals, extensions, modifications or refinancings of any of the foregoing.

 

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

 

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

 

“Organizational Documents” shall mean (a) for any corporation, the certificate or articles of incorporation or equivalent document, the bylaws, any certificate of designation or instrument relating to the rights of preferred shareholders of such corporation, and any stockholders agreement, (b) for any partnership, the partnership agreement, any certificate of limited partnership or formation or equivalent document, and any other instrument or agreement relating to the rights between or among the

 

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partners or pursuant to which such partnership is formed, (c) for any limited liability company, the operating agreement, any articles of organization or formation, any equivalent document, and any other instrument or agreement relating to the rights between the members, pertaining to the manager, or pursuant to which such limited liability company is formed, and (d) for any trust, the trust agreement and any other instrument or agreement relating to the rights between the trustors, trustees and beneficiaries pursuant to which such trust is formed.

 

“Other Connection Taxes” shall mean, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

“Other Taxes” shall mean any and all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made hereunder or under any other Loan Document or from the execution, delivery, performance or enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, this Agreement or any other Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 2.22).

 

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

 

“Participant” shall have the meaning set forth in Section 11.4(d).

 

“Participant Register” shall have the meaning set forth in Section 11.4(d).

 

“Patriot Act” shall mean the USA PATRIOT Improvement and Reauthorization Act of 2005 (Pub. L. 109-177 (signed into law March 9, 2006)), as amended and in effect from time to time.

 

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

 

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

 

“Permitted Encumbrances” shall mean:

 

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

 

(ii)                                  statutory Liens of landlords, carriers, warehousemen, mechanics, materialmen and other Liens imposed by law (including Liens on property of the Borrower or any Restricted Subsidiary in the possession of storage facilities, pipelines or barges) arising in the ordinary course of business for amounts not yet due or not overdue by more than sixty (60) days, or which are being contested in good faith by appropriate proceedings diligently conducted and with respect to which adequate reserves are being maintained in accordance with GAAP;

 

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(iii)                               Liens on cash and cash equivalents under or with respect to accounts with brokers or counterparties with respect to Hedging Transactions consisting of cash, commodities or futures contracts, options, securities, instruments and other like assets securing only Hedging Transactions;

 

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

 

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

 

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

 

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

 

(viii)                        easements, zoning restrictions, rights-of-way, covenants, restrictions, encroachments and similar encumbrances on real property that do not secure any monetary obligations and do not materially detract from the value of the affected property or materially interfere with the ordinary conduct of business of the Borrower and the Restricted Subsidiaries taken as a whole;

 

(ix)                              withdrawal and access rights held by oil companies with respect to the Intermediate Investment Accounts; and

 

(x)                                 “first-purchaser” Liens, as defined in Texas Bus. & Com. Code Section 9.343, comparable laws of the states of Oklahoma, Kansas, Wyoming, Mississippi, Wyoming or New Mexico, or any other comparable Law of any such jurisdiction or any other applicable jurisdiction.

 

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

 

“Petroleum Products” shall mean crude oil, condensate, natural gas, natural gas liquids (NGL’s), liquefied petroleum gases (LPG’s), refined petroleum products, bio-fuels or any blend thereof.

 

“Plan” shall mean any “employee benefit plan” as defined in Section 3 of ERISA (other than a Multiemployer Plan) maintained or contributed to by the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA Affiliate has or may have an obligation to contribute, and each such plan that is subject to Title IV of ERISA for the five-year period immediately following the latest date on which the Borrower or any ERISA Affiliate maintained, contributed to or had an obligation to contribute to (or is deemed under Section 4069 of ERISA to have maintained or contributed to or to have had an obligation to contribute to, or otherwise to have liability with respect to) such plan.

 

“Pricing Grid” shall have the meaning set forth in the definition of “Applicable Margin”.

 

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

 

“Recipient” shall mean, as applicable, (a) the Administrative Agent and (b) any Lender.

 

“Register” shall have the meaning set forth in Section 11.4(c).

 

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

 

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

 

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

 

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

 

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

 

“Related Parties” shall mean, with respect to any specified Person, such Person’s Affiliates and the respective managers, members, shareholders, administrators, trustees, partners, directors, officers, agents, members, employees, accountants, legal counsel or other advisors of such Person and such Person’s Affiliates.

 

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

 

“Required Lenders” shall mean, at any time, Lenders holding more than 50% of the aggregate outstanding Commitments or, if the Lenders have no Commitments outstanding, then Lenders holding more than 50% of the aggregate outstanding principal amount of Loans at such time; provided, that to the extent that any Lender is a Defaulting Lender, such Defaulting Lender and all of its Commitments and the outstanding principal amount of all Loans owing to such Lender shall be excluded for purposes of determining Required Lenders.

 

“Requirement of Law” for any Person shall mean Governmental Requirements applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

 

“Responsible Officer” shall mean (x) with respect to certifying compliance with the financial covenants set forth in Article VI, the chief financial officer or the treasurer of BPL and (y) with respect to all other provisions, any of the president, the chief executive officer, the chief operating officer, the chief financial officer, the treasurer or a vice president of the Borrower or such other representative of the Borrower as may be designated in writing by any one of the foregoing with the consent of the Administrative Agent.

 

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“Restricted Payment” shall mean, for any Person, any dividend or distribution on any class of its Equity Interests, or any payment on account of, or set apart assets for a sinking or other analogous fund for, the purchase, redemption, retirement, defeasance or other acquisition of, any shares of its Equity Interests, any Indebtedness subordinated to the Obligations or any Guarantee thereof or any options, warrants, or other rights to purchase such Equity Interests or such Indebtedness, whether now or hereafter outstanding.

 

“Restricted Subsidiary” shall mean all Subsidiaries of BPL, other than Unrestricted Subsidiaries.  As of the date hereof, the initial Restricted Subsidiaries shall consist of those Persons listed on Exhibit B-1.

 

“Revolving Credit Agreement” shall mean the Revolving Credit Agreement, dated as of September 30, 2014, by and among Borrower and the Subsidiaries of Borrower from time to time party thereto, as borrowers, the several banks and other financial institutions and lenders from time to time party thereto, as lenders and SunTrust Bank, as administrative agent for such lenders, as amended by that certain First Amendment to Revolving Credit Agreement, dated as of December 16, 2015, that certain Second Amendment to Revolving Credit Agreement, dated as of September 30, 2016, and as the same may be further amended, restated, amended and restated, extended, supplemented or otherwise modified from time to time.

 

“Risk Management Policy” shall mean one or more risk management policies applicable to the Buckeye Merchant Service Companies with respect to the funding activities of the Buckeye Merchant Service Companies as approved by the Boards of Directors of the Buckeye Merchant Service Companies.

 

“S&P” shall mean Standard & Poor’s, a division of The McGraw-Hill Companies, Inc.

 

“Sanctioned Country” shall mean, at any time, a country or territory that is or whose government is, the subject or target of any Sanctions or any other relevant sanctions authority.

 

“Sanctioned Person” shall mean (i) a Person named on the list of “Specially Designated Nationals and Blocked Persons” maintained by OFAC available at http://www.treasury.gov/resource-center/sanctions/SDN-List/Pages/default.aspx, or as otherwise published from time to time, (ii) any Person listed in any Sanctions-related list of designated Persons by the U.S. Department of State, the United Nations Security Council, the European Union or any member state of the European Union, or (iii) (A) an agency of the government of a Sanctioned Country, (B) an organization controlled by a Sanctioned Country, or (C) a person resident in a Sanctioned Country, to the extent subject to a sanctions program administered by OFAC.

 

“Sanctions” shall mean economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom.

 

“Special Entity” of any Person shall mean any joint venture, limited liability company or partnership, general or limited partnership or any other type of partnership or company other than a corporation in which such Person or one or more of its Subsidiaries is a member, owner, partner or joint venturer and either (a) owns, directly or indirectly, at least a majority of the equity or other ownership interests of such entity, or (b) controls such entity, but excluding any tax partnerships that are not classified as partnerships under state law.  For purposes of this definition, any Person that owns directly or indirectly an equity investment in another Person that allows the first Person to manage or elect managers having sufficient power to manage the normal activities of such second Person will be deemed to “control” such second Person (e.g., a sole general partner controls a limited partnership).

 

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“Subsidiary” shall mean, with respect to any Person (the “parent”), any corporation, partnership, joint venture, limited liability company, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, partnership, joint venture, limited liability company, association or other entity (i) of which securities or other ownership interests representing more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (ii) that is, as of such date, otherwise controlled by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent; provided that notwithstanding anything herein to the contrary, Buckeye Pipeline Services Company shall not be considered a Subsidiary of BPL so long as (x) it would only be considered a Subsidiary because it consolidates into the BPL financial statements pursuant to GAAP, (y) its activities are substantially similar to its activities on the Closing Date and (z) it does not have material operating assets (other than Equity Interests in BPL).  Unless otherwise indicated, all references to “Subsidiary” hereunder shall mean a Subsidiary of BPL.

 

“Synthetic Lease” shall mean a lease transaction under which the parties intend that (i) the lease will be treated as an “operating lease” by the lessee pursuant to Accounting Standards Codification Sections 840-10 and 840-20, as amended, and (ii) the lessee will be entitled to various tax and other benefits ordinarily available to owners (as opposed to lessees) of like property.

 

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

 

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

 

“Ticking Fee” shall have the meaning set forth in Section 2.13(b).

 

“Total Capitalization” shall mean, at the date of any determination thereof, the sum of (a) all Indebtedness of BPL and its Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP plus (b) the consolidated partners’ equity of BPL and its Restricted Subsidiaries.

 

“Trading with the Enemy Act” shall mean the Trading with the Enemy Act of the United States of America (50 U.S.C. App. §§ 1 et seq.), as amended and in effect from time to time.

 

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

 

“Unfunded Pension Liability” of any Plan shall mean the amount, if any, by which the value of the accumulated plan benefits under the Plan, determined on a plan termination basis in accordance with actuarial assumptions at such time consistent with those prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions).

 

“United States” or “U.S.” shall mean the United States of America.

 

“Unrestricted Subsidiary” shall mean those Persons listed on Exhibit B-2 and any Subsidiary of BPL designated in writing by BPL to the Administrative Agent as an “Unrestricted Subsidiary” in accordance with Section 5.10.

 

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“U.S. Person” shall mean any Person that is a “United States person” as defined in Section 7701(a)(30) of the Code.

 

“U.S. Tax Compliance Certificate” shall have the meaning set forth in Section 2.19(e)(ii).

 

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

 

“Withholding Agent” shall mean the Borrower or the Administrative Agent, as applicable.

 

“Write-Down and Conversion Powers” shall mean, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

Section 1.2.                                Reserved.

 

Section 1.3.                                Accounting Terms and Determination.  Unless otherwise defined or specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with GAAP as in effect from time to time, applied on a basis consistent with the most recent audited consolidated financial statement of BPL delivered pursuant to Section 5.1(a); provided that if the Borrower notifies the Administrative Agent that the Borrower wishes to amend any provision to eliminate the effect of any change in GAAP on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders wish to amend any provision for such purpose), then the Borrower’s compliance with such provision shall be determined on the basis of GAAP in effect immediately before the relevant change in GAAP became effective, until either such notice is withdrawn or such provision is amended in a manner satisfactory to the Borrower and the Required Lenders and the Borrower shall provide to the Administrative Agent such line item reconciliations, as the Administrative Agent may reasonably request.  It is understood and agreed that, solely with respect to any change in GAAP after the Closing Date with respect to the accounting for leases as either operating leases or capital leases, any lease that is not (or would not be) a capital lease under GAAP as in effect on the Closing Date will not be treated as a capital lease hereunder solely as a result of such change in GAAP after the Closing Date.  Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to any election under Accounting Standards Codification Section 825-10 (or any other Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of BPL or any Subsidiary thereof at “fair value”, as defined therein.

 

Section 1.4.                                Terms Generally.  The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the word “to” means “to but excluding”.  Unless the context requires otherwise (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as it was originally executed or as it may from time to time be amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (ii) any reference herein to any Person shall be construed to include such Person’s successors and permitted assigns, (iii) the words “hereof”, “herein” and

 

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“hereunder” and words of similar import shall be construed to refer to this Agreement as a whole and not to any particular provision hereof, (iv) all references to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles, Sections, Exhibits and Schedules to this Agreement, (v) all references to a specific time shall be construed to refer to the time in the city and state of the Administrative Agent’s principal office, unless otherwise indicated and (vi) references to any Governmental Requirement shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Governmental Requirement.

 

ARTICLE II.

 

AMOUNT AND TERMS OF THE COMMITMENTS

 

Section 2.1.                                General Description of Facilities.  Subject to and upon the terms and conditions herein set forth,  the Lenders hereby establish in favor of the Borrower a delayed draw term loan credit facility pursuant to which each Lender severally agrees (to the extent of such Lender’s Commitment) to make Loans in Dollars to the Borrower in accordance with Section 2.2.

 

Section 2.2.                                Delayed Draw Term Loans.  Subject to the terms and conditions set forth herein, each Lender severally agrees to make Loans, ratably in proportion to its Pro Rata Share of the Aggregate Commitments, to the Borrower, in Dollars and from time to time during the Availability Period, in up to three (3) drawings, in an aggregate principal amount up to such Lender’s Commitment.  Amounts borrowed as Loans hereunder that are repaid or prepaid may not be reborrowed.

 

Section 2.3.                                Procedure for Borrowings.  The Borrower shall give the Administrative Agent written notice (or telephonic notice promptly confirmed in writing which, for the avoidance of doubt, may be delivered by e-mail in accordance with Section 11.1) of each Borrowing substantially in the form of Exhibit 2.3 attached hereto (a “Notice of Borrowing”) (x) prior to 11:00 a.m. on the requested date of each Base Rate Borrowing and (y) prior to 12:00 noon three (3) Business Days prior to the requested date of each Eurodollar Borrowing; provided, that such Notice of Borrowing may be submitted on the Closing Date with respect to any Eurodollar Borrowings made on the Closing Date, solely to the extent such Notice of Borrowing is accompanied by a funding indemnity letter in form and substance reasonably satisfactory to the Administrative Agent.  Each Notice of Borrowing shall be irrevocable and shall specify (i) the Borrower, (ii) the aggregate principal amount of such Borrowing, (iii) the date of such Borrowing (which shall be a Business Day), (iv) the Type of the Loan comprising such Borrowing and (v) in the case of a Eurodollar Borrowing, the duration of the initial Interest Period applicable thereto (subject to the provisions of the definition of Interest Period).  Each Borrowing shall consist entirely of Base Rate Loans or Eurodollar Loans, as the Borrower may request.  The aggregate principal amount of each Eurodollar Borrowing shall not be less than $3,000,000 or a larger multiple of $1,000,000, and the aggregate principal amount of each Base Rate Borrowing shall not be less than $1,000,000 or a larger multiple of $100,000.  At no time shall the total number of Eurodollar Borrowings outstanding at any time exceed three.  Promptly following the receipt of a Notice of Borrowing in accordance herewith, the Administrative Agent shall advise each Lender of the details thereof and the amount of such Lender’s Loan to be made as part of the requested Borrowing.

 

Section 2.4.                                Reserved.

 

Section 2.5.                                Funding of Borrowings.

 

(a)                                 Each Lender will make available each Loan to be made by it hereunder on the proposed date thereof by wire transfer in immediately available funds by 11:00 a.m. in the case of Eurodollar Loans and by 2:00 p.m. in the case of Base Rate Loans to the Administrative Agent at the Payment Office.  The Administrative Agent will make such Loans available to the Borrower promptly on the proposed date (and in any event no later than close of business) by crediting the amounts that it receives, in Dollars in like funds, to an account maintained by the Borrower with

 

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the Administrative Agent or, at the Borrower’s option, by effecting a wire transfer of such amounts to an account located in the United States and designated by the Borrower to the Administrative Agent.

 

(b)                                 Unless the Administrative Agent shall have been notified by any Lender prior to 5:00 p.m. one (1) Business Day prior to the date of a Borrowing in which such Lender is to participate that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such amount available to the Administrative Agent on such date, and the Administrative Agent, in reliance on such assumption, may make available to the Borrower on such date a corresponding amount.  If such corresponding amount is not in fact made available to the Administrative Agent by such Lender on the date of such Borrowing, the Administrative Agent shall be entitled to recover such corresponding amount on demand from such Lender together with interest (x) at the Federal Funds Rate until the second Business Day after such demand and (y) at the Base Rate at all times thereafter.  If such Lender does not pay such corresponding amount forthwith upon the Administrative Agent’s demand therefor, the Administrative Agent shall promptly notify the Borrower, and the Borrower shall immediately pay such corresponding amount to the Administrative Agent together with interest at the rate specified for such Borrowing.  Nothing in this subsection shall be deemed to relieve any Lender from its obligation to fund its Pro Rata Share of any Borrowing hereunder or to prejudice any rights which the Borrower may have against any Lender as a result of any default by such Lender hereunder.  With respect to any share of a Borrowing not made available by a Lender as contemplated above, if such Lender subsequently pays its share of such Borrowing to the Administrative Agent, then the Administrative Agent shall promptly forward such amount to the Borrower.

 

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

 

Section 2.6.                                Interest Elections.

 

(a)                                 Each Borrowing initially shall be of the Type specified in the applicable Notice of Borrowing.  Thereafter, the Borrower may elect to convert such Borrowing into a different Type or to continue such Borrowing, all as provided in this Section.  The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.

 

(b)                                 To make an election pursuant to this Section, the Borrower shall give the Administrative Agent written notice (or telephonic notice promptly confirmed in writing which, for the avoidance of doubt, may be delivered by e-mail in accordance with Section 11.1) of each Borrowing that is to be converted or continued, as the case may be, substantially in the form of Exhibit 2.6 attached hereto (a “Notice of Conversion/Continuation”) (x) prior to 11:00 a.m. on the requested date of a conversion into a Base Rate Borrowing and (y) prior to 11:00 a.m. three (3) Business Days prior to a continuation of or conversion into a Eurodollar Borrowing.  Each such Notice of Conversion/Continuation shall be irrevocable and shall specify (i) the Borrowing to which such Notice of Conversion/Continuation applies and, if different options are being elected with respect to different portions thereof, the portions thereof that are to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) shall be specified for each resulting Borrowing), (ii) the effective date of the election made pursuant to such Notice of Conversion/Continuation, which shall be a Business Day, (iii) whether the resulting Borrowing is to be a Base Rate Borrowing or a Eurodollar Borrowing, and

 

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(iv) if the resulting Borrowing is to be a Eurodollar Borrowing, the Interest Period applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of “Interest Period”.  If any such Notice of Conversion/Continuation requests a Eurodollar Borrowing but does not specify an Interest Period, the Borrower shall be deemed to have selected an Interest Period of one month.  The principal amount of any resulting Borrowing shall satisfy the minimum borrowing amount for Eurodollar Borrowings and Base Rate Borrowings set forth in Section 2.3.

 

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

 

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

 

Section 2.7.                                Optional Reduction and Termination of Commitments.

 

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

 

(b)                                 Upon at least three (3) Business Days’ prior written notice (or telephonic notice promptly confirmed in writing which, for the avoidance of doubt, may be delivered by e-mail in accordance with Section 11.1) to the Administrative Agent (which notice shall be irrevocable except that a notice of commitment reduction or termination under this Section 2.7(b) may state that such notice is conditioned upon the effectiveness of other credit facilities or the receipt of the proceeds from the incurrence of other Indebtedness or any other event, in which case such notice of commitment reduction or termination may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified date) if such condition is not satisfied)), the Borrower may reduce the Aggregate Commitments in part or terminate the Aggregate Commitments in whole; provided that (i) any partial reduction shall apply to reduce proportionately and permanently the Commitment of each Lender and (ii) any partial reduction pursuant to this Section shall be in an amount of at least $5,000,000 and any larger multiple of $1,000,000.

 

(c)                                  So long as no Event of Default has occurred and is continuing, with the written approval of the Administrative Agent, the Borrower may terminate (on a non-ratable basis) the unused amount of the Commitment of a Defaulting Lender, and in such event the provisions of Section 2.23 will apply to all amounts thereafter paid by the Borrower for the account of any such Defaulting Lender under this Agreement (whether on account of principal, interest, fees, indemnity or other amounts); provided that such termination will not be deemed to be a waiver or release of any claim that the Borrower, the Administrative Agent or any Lender may have against such Defaulting Lender.

 

Section 2.8.                                Repayment of Loans.  The Borrower unconditionally promises to pay to the Administrative Agent, for the account of each Lender, the aggregate outstanding principal balance of the Loans of such Lender on the Maturity Date applicable to such Lender.

 

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Section 2.9.                                Evidence of Indebtedness.

 

(a)                                 Each Lender shall maintain in accordance with its usual practice appropriate records evidencing the Indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable thereon and paid to such Lender from time to time under this Agreement.  The Administrative Agent shall maintain appropriate records in which shall be recorded (i) the Commitment, (ii) the amount of each Loan made hereunder by each Lender, the Type thereof and, in the case of each Eurodollar Loan, the Interest Period applicable thereto, (iii) the date of any continuation of any Loan pursuant to Section 2.6, (iv) the date of any conversion of all or a portion of any Loan to another Type pursuant to Section 2.6, (v) the date and amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder in respect of the Loans and (vi) both the date and amount of any sum received by the Administrative Agent hereunder from the Borrower in respect of the Loans and each Lender’s Pro Rata Share thereof.  The entries made in such records shall be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided that the failure or delay of any Lender or the Administrative Agent in maintaining or making entries into any such record or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans (both principal and unpaid accrued interest) of such Lender in accordance with the terms of this Agreement.

 

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

 

Section 2.10.                         Optional Prepayments.  The Borrower shall have the right at any time and from time to time to prepay any Borrowing, in whole or in part, without premium or penalty, by giving written notice (or telephonic notice promptly confirmed in writing which, for the avoidance of doubt, may be delivered by e-mail in accordance with Section 11.1) to the Administrative Agent no later than (i) in the case of any prepayment of any Eurodollar Borrowing, 11:00 a.m. not less than three (3) Business Days prior to the date of such prepayment, and (ii) in the case of any prepayment of any Base Rate Borrowing, prior to 11:00 a.m. on the date of such prepayment.  Each such notice shall be irrevocable and shall specify the proposed date of such prepayment and the principal amount of each Borrowing or portion thereof to be prepaid; provided that a notice of optional prepayment may state that such notice is conditioned upon the effectiveness of other credit facilities or the receipt of the proceeds from the incurrence of other Indebtedness or any other event, in which case such notice of prepayment may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified date) if such condition is not satisfied.    Upon receipt of any such notice, the Administrative Agent shall promptly notify each affected Lender of the contents thereof and of such Lender’s Pro Rata Share of any such prepayment.  If such notice is given, the aggregate amount specified in such notice shall be due and payable on the date designated in such notice, together with accrued interest to such date on the amount so prepaid in accordance with Section 2.12(c); provided that if a Eurodollar Borrowing is prepaid on a date other than the last day of an Interest Period applicable thereto, the Borrower shall also pay all amounts required pursuant to Section 2.18.  Each partial prepayment of any Loan shall be in an amount that would be permitted in the case of an advance of a Borrowing of the same Type pursuant to Section 2.2.  Each prepayment of a Borrowing shall be applied ratably to the Loans comprising such Borrowing.

 

Section 2.11.                         Reserved.

 

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Section 2.12.                         Interest on Loans.

 

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

 

(b)                                 Notwithstanding subsection (a) of this Section, at the option of the Required Lenders if an Event of Default has occurred and is continuing, and automatically after acceleration or with respect to any past due amount hereunder, the Borrower shall pay interest (“Default Interest”) with respect to its portion of all Eurodollar Loans at the rate per annum equal to 200 basis points above the otherwise applicable interest rate for such Eurodollar Loans for the then-current Interest Period until the last day of such Interest Period, and thereafter, and with respect to its portion of all Base Rate Loans and all other Obligations hereunder (other than Loans), at the rate per annum equal to 200 basis points above the otherwise applicable interest rate for Base Rate Loans.

 

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

 

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

 

Section 2.13.                         Fees.

 

(a)                                 BPL agrees to pay to the Administrative Agent for its own account fees in the amounts and at the times previously agreed upon in writing by BPL and the Administrative Agent.

 

(b)                                 BPL agrees to pay to the Administrative Agent for the account of each Lender, a fee which shall accrue at the Applicable Percentage per annum (determined daily in accordance with the Pricing Grid) on the daily amount of the unused Commitment of such Lender (the “Ticking Fee”), commencing on the date which is thirty days after the Closing Date and continuing through (and including) the Commitment Termination Date.  The Ticking Fee shall be payable on the Commitment Termination Date.

 

(c)                                  The Borrower shall pay on the Closing Date to the Administrative Agent and its affiliates all fees in the Fee Letter that are due and payable on the Closing Date.  The Borrower shall pay on the Closing Date to the Lenders all upfront fees previously agreed in writing.

 

(d)                                 Anything herein to the contrary notwithstanding, during such period as a Lender is a Defaulting Lender, such Defaulting Lender will not be entitled to Ticking Fees accruing with respect to its Commitment during such period pursuant to subsection (b) of this Section (without prejudice to the rights of the Lenders other than Defaulting Lenders in respect of such fees).  The

 

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pro rata payment provisions of Section 2.20 shall automatically be deemed adjusted to reflect the provisions of this subsection.

 

Section 2.14.                         Computation of Interest and Fees.  Interest hereunder based on the Administrative Agent’s prime lending rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year) and paid for the actual number of days elapsed (including the first day but excluding the last day).  All other interest and all fees shall be computed on the basis of a year of 360 days and paid for the actual number of days elapsed (including the first day but excluding the last day).  Each determination by the Administrative Agent of an interest rate or fee hereunder shall be made in good faith and, except for manifest error, shall be final, conclusive and binding for all purposes.

 

Section 2.15.                         Inability to Determine Interest Rates.  If prior to the commencement of any Interest Period for any Eurodollar Borrowing,

 

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

 

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

 

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

 

Section 2.16.                         Illegality.  If any Change in Law shall make it unlawful or impossible for any Lender to make, maintain or fund any Eurodollar Loan and such Lender shall so notify the Administrative Agent, the Administrative Agent shall promptly give notice thereof to the Borrower and the other Lenders, whereupon until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such suspension no longer exist, the obligation of such Lender to make Eurodollar Loans, or to continue or convert outstanding Loans as or into Eurodollar Loans, shall be suspended.  In the case of the making of a Eurodollar Borrowing, such Lender’s Loan shall be made as a Base Rate Loan as part of the same Borrowing for the same Interest Period and, if the affected Eurodollar Loan is then outstanding, such Loan shall be converted to a Base Rate Loan either (i) on the last day of the then current Interest Period applicable to such Eurodollar Loan if such Lender may lawfully continue to maintain such Loan to such date or (ii) immediately if such Lender shall determine that it may not lawfully continue to maintain such Eurodollar Loan to such date.  Notwithstanding the foregoing, the affected Lender shall, prior to giving such notice to the Administrative Agent, designate a different Applicable Lending Office if such designation would avoid the need for giving such notice and if such designation would not otherwise be disadvantageous to such Lender in the good faith exercise of its discretion.

 

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Section 2.17.                         Increased Costs.

 

(a)                                 If any Change in Law shall:

 

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

 

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

 

(iii)                               subject any Recipient to any Taxes (other than Indemnified Taxes, Excluded Taxes and Other Connection Taxes) on its loans, loan principal, commitments or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto

 

and the result of any of the foregoing is to increase the cost to such Lender of making, converting into, continuing or maintaining a Eurodollar Loan or to reduce the amount received or receivable by such Lender hereunder (whether of principal, interest or any other amount), then, from time to time, such Lender may provide the Borrower (with a copy thereof to the Administrative Agent) with written notice and demand with respect to such increased costs or reduced amounts, and within ten (10) Business Days after receipt of such notice and demand the Borrower shall pay to such Lender such additional amounts as will compensate such Lender for any such increased costs incurred or reduction suffered.

 

(b)                                 If any Lender shall have determined that on or after the date of this Agreement any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s capital (or on the capital of the Parent Company of such Lender) as a consequence of its obligations hereunder to a level below that which such Lender or such Parent Company could have achieved but for such Change in Law (taking into consideration such Lender’s policies or the policies of such Parent Company with respect to capital adequacy and liquidity), then, from time to time, such Lender may provide the Borrower (with a copy thereof to the Administrative Agent) with written notice and demand with respect to such reduced amounts, and within ten (10) Business Days after receipt of such notice and demand the Borrower shall pay to such Lender such additional amounts as will compensate such Lender or such Parent Company for any such reduction suffered.

 

(c)                                  A certificate of such Lender setting forth the amount or amounts necessary to compensate such Lender or the Parent Company of such Lender specified in subsection (a) or (b) of this Section and setting forth in reasonable detail the manner in which such amount or amounts was determined shall be delivered to the Borrower (with a copy to the Administrative Agent) and shall be conclusive, absent manifest error.

 

(d)                                 Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than one hundred eighty (180) days prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

 

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Section 2.18.                         Funding Indemnity.  In the event of (a) the payment of any principal of a Eurodollar Loan other than on the last day of the Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion or continuation of a Eurodollar Loan other than on the last day of the Interest Period applicable thereto, or (c) the failure by the Borrower to borrow, prepay, convert or continue any Eurodollar Loan on the date specified in any applicable notice (regardless of whether such notice is withdrawn or revoked), then, in any such event, BPL shall compensate each Lender, within five (5) Business Days after written demand from such Lender, for any loss, cost or expense attributable to such event.  In the case of a Eurodollar Loan, such loss, cost or expense shall be deemed to include an amount determined by such Lender to be the excess, if any, of (A) the amount of interest that would have accrued on the principal amount of such Eurodollar Loan if such event had not occurred at the Adjusted LIBO Rate applicable to such Eurodollar Loan for the period from the date of such event to the last day of the then current Interest Period therefor (or in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Eurodollar Loan) over (B) the amount of interest that would accrue on the principal amount of such Eurodollar Loan for the same period if the Adjusted LIBO Rate were set on the date such Eurodollar Loan was prepaid or converted or the date on which the Borrower failed to borrow, convert or continue such Eurodollar Loan.  A certificate as to any additional amount payable under this Section and the basis therefor and setting forth in reasonable detail the manner in which such amount or amounts was determined shall be submitted to the Borrower by any Lender (with a copy to the Administrative Agent) shall be conclusive, absent manifest error.

 

Section 2.19.                         Taxes.

 

(a)                                 Any and all payments by or on account of any obligation of the Borrower hereunder or under any other Loan Document shall be made without deduction or withholding for any Taxes; provided that if any applicable Requirements of Law requires the deduction or withholding of any Tax from any such payment, then the applicable Withholding Agent shall make such deduction or withholding and timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Requirements of Law and, if such Tax is an Indemnified Tax or Other Tax, then the sum payable by the relevant Borrower shall be increased as necessary so that after making all required deductions and withholdings (including deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient shall receive an amount equal to the sum it would have received had no such deductions or withholdings been made.

 

(b)                                 In addition, without limiting the provisions of subsection (a) of this Section, the Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

 

(c)                                  Without duplication of its responsibilities under Section 2.19(a), BPL shall indemnify each Recipient within fifteen (15) Business Days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid or payable by such Recipient or required to be withheld or deducted from a payment to such Recipient (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) and any penalties, interest and reasonable, documented out-of-pocket 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, except any such penalties, interest or expenses resulting from a Recipient’s gross negligence or willful misconduct.  Each Recipient agrees to give written notice to the Borrower of the assertion of any claim against such Recipient relating to such Indemnified Taxes or Other Taxes no later than 180 days after such Recipient obtains knowledge thereof, and the Borrower shall not be required to pay additional amounts, or indemnify the Recipient, under this Section 2.19 for any such Indemnified Taxes or Other Taxes to the extent such Recipient fails to provide such written notice within such 180-day period.  A certificate as to the amount of such payment or liability

 

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delivered to the Borrower by the applicable Recipient (with a copy to the Administrative Agent in the case of a Recipient other than the Administrative Agent) shall be conclusive, absent manifest error.

 

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

 

(e)                                  Tax Forms.

 

(i)                                     Any Recipient that is entitled to an exemption from or reduction of withholding tax with respect to payments under this Agreement shall deliver to the Borrower and the Administrative Agent, at the time or times prescribed by applicable Requirement of Law, such properly completed and executed documentation prescribed by applicable Requirement of Law or reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding and as will permit to the Administrative Agent and the Borrower to determine whether or not such Recipient is subject to backup withholding or information reporting requirements.  Without limiting the generality of the foregoing, any Recipient that is a U.S. Person shall deliver to the Borrower and the Administrative Agent, on or prior to the date on which such Recipient becomes a Recipient under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), duly executed originals of IRS Form W-9 certifying, to the extent such Recipient is legally entitled to do so, that such Recipient is exempt from U.S. federal backup withholding tax.

 

(ii)                                  Each Recipient that is a Foreign Person shall, to the extent it is legally entitled to do so, (w) on or prior to the date such Recipient becomes a Recipient under this Agreement, (x) on or prior to the date on which any such form or certification expires or becomes obsolete, (y) after the occurrence of any event requiring a change in the most recent form or certification previously delivered by it pursuant to this subsection, and (z) from time to time upon the reasonable request by the Borrower or the Administrative Agent, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the Borrower or the Administrative Agent), whichever of the following is applicable:

 

(A)                               if such Recipient is claiming eligibility for benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, duly executed originals of IRS Form W-8BEN, Form W-8BEN-E, or any successor forms thereto, establishing an exemption from, or reduction of, U.S. federal withholding tax pursuant to the “interest” article of such tax treaty, and (y) with respect to any other applicable payments under any Loan Document, duly executed originals of IRS Form W-8BEN, Form W-8BEN-E, or any successor forms thereto, establishing an exemption from, or reduction of, U.S. federal withholding tax pursuant to the “business profits” or “other income” article of such tax treaty;

 

(B)                             duly executed originals of IRS Form W-8ECI, or any successor form thereto, certifying that the payments received by such Recipient are effectively connected with such Recipient’s conduct of a trade or business in the United States;

 

(C)                             if such Recipient is claiming the benefits of the exemption for portfolio interest under Section 871(h) or Section 881(c) of the Code, duly executed originals of IRS Form W-8BEN, Form W-8BEN-E, or any successor forms thereto, together with a certificate (a “U.S. Tax Compliance Certificate”) reasonably acceptable to the

 

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Administrative Agent and the Borrower, upon which such Recipient certifies that (1) such Recipient is not a bank for purposes of Section 881(c)(3)(A) of the Code, (2) such Recipient is not a 10% shareholder of the Borrower within the meaning of Section 871(h)(3) or Section 881(c)(3)(B) of the Code, (3) such Recipient is not a controlled foreign corporation that is related to the Borrower within the meaning of Section 881(c)(3)(C) of the Code, and (4) the interest payments in question are not effectively connected with a U.S. trade or business conducted by such Recipient; or

 

(D)                               if such Recipient is not the beneficial owner (for example, a partnership or a participating Recipient granting a typical participation), duly executed originals of IRS Form W-8IMY, or any successor form thereto, accompanied by IRS Form W-9, IRS Form W-8ECI, IRS Form W-8BEN, a U.S. Tax Compliance Certificate, and/or other certification documents from each beneficial owner, as applicable.

 

(iii)                               Each Recipient agrees that if any form or certification it previously delivered under this Section expires or becomes obsolete or inaccurate in any respect and such Recipient is not legally entitled to provide an updated form or certification, it shall promptly notify the Borrower and the Administrative Agent of its inability to update such form or certification.

 

(f)                                   If a payment made to a Recipient under any Loan Document would be subject to U.S. federal withholding tax imposed by FATCA if such Recipient were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Recipient shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Recipient has complied with such Recipient’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.  For purposes of this Section 2.19(f), “FATCA” shall be deemed to include any amendment or successor thereto.

 

(g)                                  If any Recipient determines, in its discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.19 (including by the payment of additional amounts pursuant to this Section 2.19), 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 with respect to the Taxes giving rise to such refund) within thirty (30) days after receipt thereof, net of all out-of-pocket expenses of such Recipient and without interest (other than any interest paid by the relevant Governmental Authority).  The Borrower, upon the written request of such Recipient, shall repay to such Recipient the amount paid over pursuant to this Section 2.19(g) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such Recipient is required to repay such refund to such Governmental Authority.  This subsection shall not be construed to require any Recipient to make available its tax returns (or any other information relating to its taxes which it deems confidential) to the Borrower or any other Person.

 

Section 2.20.                         Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

 

(a)                                 The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest or fees, or of amounts payable under Sections 2.17, 2.18 or 2.19, or otherwise) prior to 1:00 p.m. on the date when due, in immediately available funds, free and clear of any defenses, rights of set-off, counterclaim, or withholding or deduction of taxes.  Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made to the Administrative Agent at the

 

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Payment Office and except that payments pursuant to Sections 2.17, 2.18 and 2.19 and 10.3 shall be made directly to the Persons entitled thereto.  The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof.  If any payment under any Loan Document shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be made payable for the period of such extension.  All payments hereunder shall be made in Dollars.

 

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

 

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

 

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

 

(e)                                  Notwithstanding anything herein to the contrary, any amount paid by the Borrower for the account of a Defaulting Lender under this Agreement (whether on account of principal, interest, fees, indemnity payments or other amounts) will be retained by the

 

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Administrative Agent in a segregated non-interest bearing account until the Maturity Date at which time the funds in such account will be applied by the Administrative Agent, to the fullest extent permitted by law, in the following order of priority:  first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent under this Agreement; second, to the payment of interest due and payable to the Lenders hereunder that are not Defaulting Lenders, ratably among them in accordance with the amounts of such interest then due and payable to them; third, to the payment of fees then due and payable to the Lenders hereunder that are not Defaulting Lenders, ratably among them in accordance with the amounts of such fees then due and payable to them; fourth, to the ratable payment of other amounts then due and payable to the Lenders hereunder that are not Defaulting Lenders, fifth, to the payment of any amounts owing to the Borrower by any Defaulting Lender as a result of a final judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement, to the extent that the Administrative Agent has received at least two Business Days’ prior notice of such judgment and a copy of the final order with respect thereto; and sixth, to pay amounts owing under this Agreement to such Defaulting Lender or as a court of competent jurisdiction may otherwise direct.

 

Section 2.21.                         Mitigation of Obligations.  If any Lender requests compensation under Section 2.17, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.19, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable under Section 2.17 or Section 2.19, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender.  BPL agrees to pay all reasonable costs and expenses incurred by any Lender in connection with such designation or assignment.

 

Section 2.22.                         Replacement of Lenders.  If (a) any Lender requests compensation under Section 2.17, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.19, (b) any Lender is a Defaulting Lender, or (c) in connection with any proposed amendment, modification, termination, waiver or consent with respect to any of the provisions hereof as contemplated by Section 11.2(b), the consent of Required Lenders shall have been obtained but the consent of one or more of such other Lenders (each a “Non-Consenting Lender”) whose consent is required shall not have been obtained, 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 (and such Lender agrees to assign and delegate), without recourse (in accordance with and subject to the restrictions set forth in Section 11.4(b)), all of its interests, rights (other than its existing rights to payments pursuant to Section 2.17 or 2.19) and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender) (a “Replacement Lender”); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not be unreasonably withheld (unless such assignment would not require such consent under Section 11.4), (ii) such Lender shall have received payment of an amount equal to the outstanding principal amount of all Loans owed to it, all accrued interest thereon, accrued fees, any breakage costs required under Section 2.10 and all other amounts payable to it hereunder from the assignee (in the case of such outstanding principal and accrued interest and fees) and from the Borrower (in the case of all other amounts), (iii) in the case of a claim for compensation under Section 2.17 or payments required to be made pursuant to Section 2.19, such assignment will result in a reduction in such compensation or payments, and (iv) in the case of a Non-Consenting Lender, each Replacement Lender shall consent, at the time of such assignment, to each matter in respect of which such terminated Lender was a Non-Consenting Lender.  A Lender (other than a Defaulting Lender) shall not be required to make any such assignment and 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

 

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cease to apply.  Nothing in this Section 2.22 shall be deemed to prejudice any rights that the Borrower or any Lender that is not a Defaulting Lender may have against any Lender that is a Defaulting Lender.

 

Section 2.23.                         Defaulting Lenders.

 

(a)                                 Reserved.

 

(b)                                 If any Lender shall fail to make any payment required to be made by it hereunder, then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), (i) apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender’s obligations hereunder until all such unsatisfied obligations are fully paid and/or (ii) hold any such amounts in a segregated account as cash collateral for, and apply any such amounts to, any future funding obligations of such Lender hereunder; application of amounts pursuant to (i) and (ii) above shall be made in such order as may be determined by the Administrative Agent in its reasonable discretion.

 

(c)                                  If the Borrower and the Administrative Agent agree in writing in their discretion that any Defaulting Lender has ceased 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 conditions set forth therein, such Lender will cease to be a Defaulting Lender and will be a Non-Defaulting Lender; provided that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Non-Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lender’s having been a Defaulting Lender.

 

Section 2.24.                         Extension of Maturity Date.

 

(a)                                 From time to time after the first anniversary of the Closing Date, but at least 45 days prior to the scheduled Maturity Date then in effect, the Borrower may, by written notice to the Administrative Agent, request that the scheduled Maturity Date then in effect be extended by one calendar year, effective as of a date selected by the Borrower (the “Extension Effective Date”); provided, that (i) the Borrower may only make one such request in any calendar year and no more than two such requests during the term of this Agreement and (ii) the Extension Effective Date shall be at least 45 days, but not more than 60 days, after the date such extension request is received by the Administrative Agent (the “Extension Request Date”).  Upon receipt of the extension request, the Administrative Agent shall promptly notify each Lender of such request.  If a Lender agrees, in its sole discretion, to so extend the Maturity Date applicable to its Loans (an “Extending Lender”), it shall deliver to the Administrative Agent a written notice of its agreement to do so no later than 15 days after the Extension Request Date (or such later date to which the Borrower and the Administrative Agent shall agree), and the Administrative Agent shall promptly thereafter notify the Borrower of such Extending Lender’s agreement to extend the Maturity Date applicable to such Lender’s Loans (and such agreement shall be irrevocable until the Extension Effective Date).  The Loans owing to any Lender that fails to accept or respond to the Borrower’s request for extension of the Maturity Date (a “Declining Lender”) shall be paid in full by the Borrower on the Maturity Date then in effect for such Lender (without regard to any extension by other Lenders), together with all accrued and unpaid interest thereon and all accrued and unpaid fees owing to such Declining Lender under this Agreement to the date of such payment of principal and all other amounts due to such Declining Lender under this Agreement.

 

(b)                                 The Administrative Agent shall promptly notify each Extending Lender of the aggregate Loans of the Declining Lenders.  Each Extending Lender may offer to increase its Loans by an amount not to exceed the aggregate amount of the Declining Lenders’ Loans, and such Extending Lender shall deliver to the Administrative Agent a notice of its offer to so increase its Loans no later than 30 days after the Extension Request Date (or such later date to which the Borrower and the Administrative Agent shall agree), and such offer shall be

 

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irrevocable until the Extension Effective Date.  To the extent the aggregate amount of additional Loans that the Extending Lenders offer pursuant to the preceding sentence exceeds the aggregate amount of the Declining Lenders’ Loans, such additional Loans shall be reduced on a pro rata basis.  To the extent the aggregate amount of Loans that the Extending Lenders have so offered to extend is less than the aggregate amount of Loans that the Borrower has so requested to be extended, the Borrower shall have the right to seek additional Loans from other Persons.  Once the Borrower has obtained offers to provide the full amount of any Declining Lender’s Loans (whether from Extending Lenders or other Persons), the Borrower shall have the right but not the obligation to require any Declining Lender to (and any such Declining Lender shall) assign in full its rights and obligations under this Agreement to one or more banks or other financial institutions (which may be, but need not be, one or more of the Extending Lenders) which at the time agree to, in the case of any such Person that is an Extending Lender, increase its Loan and in the case of any other such Person (a “New Lender”) become a party to this Agreement; provided that (i) such assignment is otherwise in compliance with Section 11.4, (ii) such Declining Lender receives payment in full of the unpaid principal amount of all Loans owing to such Declining Lender, together with all accrued and unpaid interest thereon and all fees accrued and unpaid under this Agreement to the date of such payment of principal and all other amounts due to such Declining Lender under this Agreement and (iii) any such assignment shall be effective on the date on or before such Extension Effective Date as may be specified by the Borrower and agreed to by the respective New Lenders and Extending Lenders, as the case may be, and the Administrative Agent.

 

(c)                                  If, but only if, Extending Lenders and New Lenders, as the case may be, have agreed to provide Loans in an aggregate amount greater than 50% of the aggregate amount of the Loans outstanding immediately prior to such Extension Effective Date and the conditions precedent in Section 3.2 are met, the Maturity Date in effect with respect to the Loans of such Extending Lenders and New Lenders shall be extended by twelve months.

 

Section 2.25.                         Acknowledgement and Consent to Bail-In of EEA Financial Institutions.  Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(a)                                 the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

 

(b)                                 the effects of any Bail-in Action on any such liability, including, if applicable:

 

(i)                                     a reduction in full or in part or cancellation of any such liability;

 

(ii)                                  a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

 

(iii)                               the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

 

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ARTICLE III.

 

CONDITIONS PRECEDENT TO LOANS

 

Section 3.1.                                Conditions to Effectiveness.  The obligations of the Lenders to make Loans hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 11.2).

 

(a)                                 The Administrative Agent shall have received payment of all fees, expenses for which invoices have been presented and other amounts due and payable on or prior to the Closing Date, including, without limitation, reimbursement or payment of all out-of-pocket expenses of the Administrative Agent and its Affiliates (including reasonable documented fees, charges and disbursements of counsel to the Administrative Agent) required to be reimbursed or paid by the Borrower hereunder, under any other Loan Document and under any agreement with the Administrative Agent or SunTrust Robinson Humphrey, Inc., as a Joint Lead Arranger.

 

(b)                                 The Administrative Agent (or its counsel) shall have received the following, each to be in form and substance satisfactory to the Administrative Agent:

 

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

 

(ii)                                  a certificate of the Secretary or Assistant Secretary of the Borrower in the form of Exhibit 3.1(b)(ii), attaching and certifying copies of its Organizational Documents, and of the resolutions of its board of directors or other equivalent governing body, or comparable organizational documents and authorizations, authorizing the execution, delivery and performance of the Loan Documents to which it is a party and certifying the name, title and true signature of each officer of the Borrower executing the Loan Documents to which it is a party;

 

(iii)                               certified copies of the articles or certificate of incorporation, certificate of organization or limited partnership, or other registered Organizational Documents of the Borrower, together with certificates of good standing or existence or the equivalent thereof, as may be available from the Secretary of State of the jurisdiction of organization (or other equivalent Governmental Authority) of the Borrower;

 

(iv)                              customary written opinions of counsel to the Borrower, addressed to the Administrative Agent and each of the Lenders, and covering such matters relating to the Borrower, the Loan Documents and the transactions contemplated therein as the Administrative Agent or the Required Lenders shall reasonably request;

 

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

 

(vi)                              a duly executed Notice of Borrowing;

 

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

 

(viii)                        certified copies of all consents, approvals, authorizations, registrations, filings and orders, and evidence of the payment of any filing fees or other similar expenses, in each case required to be made or obtained under any Requirement of Law, or by any Contractual Obligation of the Borrower or any Lender, in connection with the execution, delivery, performance, validity and enforceability of the Loan Documents or any of the transactions contemplated thereby, and such consents, approvals, authorizations, registrations, filings and orders shall be in full force and effect and all applicable waiting periods shall have expired, and no investigation or inquiry by any governmental authority regarding the Commitments shall be ongoing, or a certificate, dated the Closing Date and signed by a Responsible Officer, certifying that no such consents, approvals, authorizations, registrations, filings, orders or fee payments are required; and

 

(ix)                              to the extent requested in writing at least five (5) Business Days prior to the Closing Date, all documentation and other information about the Borrower required by the Lenders under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.

 

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

 

Section 3.2.                                Conditions to Each Credit Event.  The obligation of each Lender to make a Loan (including any Loan requested on the Closing Date) is subject to the satisfaction of the following conditions:

 

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

 

(b)                                 at the time of and immediately after giving effect to such Borrowing, all representations and warranties of the Borrower set forth in the Loan Documents shall be true and correct in all material respects (other than those representations and warranties that are expressly qualified by a Material Adverse Effect or other materiality, in which case such representations and warranties shall be true and correct in all respects) with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects (or, in the case of any representations and warranties qualified by materiality or Material Adverse Effect, in all respects) as of such earlier date); and

 

(c)                                  the Borrower shall have delivered (i) the required Notice of Borrowing and (ii) a certificate of a Responsible Officer certifying that (A) the conditions set forth in clauses (a) and (b) have been satisfied and (B) the Borrower is in compliance with the financial covenant set forth in Section 6.1 for the most recently-ended four Fiscal Quarter Period, after giving pro forma effect to the related Borrowing and any other adjustments to the constituent components of “Leverage Ratio” that have occurred after such four Fiscal Quarter Period and on or prior to the date of such Borrowing.

 

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Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in this Section.

 

ARTICLE IV.

 

REPRESENTATIONS AND WARRANTIES

 

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

 

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

 

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

 

Section 4.3.                                Governmental Approvals; No Conflicts.  The execution, delivery and performance by the Borrower of the Loan Documents to which it is a party (a) do not require any consent or approval of, registration or filing with, or any action by, any Governmental Authority, except those as have been obtained or made and are in full force and effect, (b) will not violate any Requirement of Law or any judgment, order or ruling of any Governmental Authority, in each case, applicable to the Borrower or any Restricted Subsidiary, (c) will not violate the terms of the Borrower’s Organizational Documents, (d) will not violate or result in a default under any Contractual Obligation of the Borrower, the General Partner or any Restricted Subsidiary or any of its assets or give rise to a right thereunder to require any payment to be made by the Borrower or any Restricted Subsidiary and (e) will not result in the creation or imposition of any Lien on any asset of the Borrower, the General Partner or Restricted Subsidiary, except Liens (if any) created under the Loan Documents.

 

Section 4.4.                                Financial Statements.  The Borrower has furnished to each Lender (i) the audited consolidated balance sheet of BPL and its Subsidiaries as of December 31, 2015, and the related audited consolidated statements of income, shareholders’ equity and cash flows for the Fiscal Year then ended, prepared by Deloitte & Touche LLP and (ii) the unaudited consolidated balance sheet of BPL and its Subsidiaries as of June 30, 2016, and the related unaudited consolidated statements of income and cash flows for the Fiscal Quarter and year-to-date period then ended, as applicable, certified by a Responsible Officer.  Such financial statements fairly present in all material respects the consolidated financial condition of BPL and its Subsidiaries as of such dates and the consolidated results of operations for such periods in conformity with GAAP consistently applied, subject to year-end audit adjustments and the absence of footnotes in the case of the statements referred to in clause (ii).  Since December 31, 2015, there have been no changes with respect to the Borrower and its Restricted Subsidiaries which have had or would reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.

 

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Section 4.5.                                Litigation and Environmental Matters.

 

(a)                                 No litigation, investigation or proceeding of or before any arbitrators or Governmental Authorities is pending against or, to the knowledge of the Borrower, threatened against or affecting the Borrower, the General Partner or any Restricted Subsidiary (i) that would reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect or (ii) which draws into question the validity or enforceability of this Agreement or any other Loan Document.

 

(b)                                 Neither Borrower nor any Restricted Subsidiary (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability, in each case with respect to Environmental Liabilities that would reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.

 

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

 

Section 4.7.                                Investment Company Act.  Neither the Borrower nor any Restricted Subsidiary is an “investment company” or is “controlled” by an “investment company”, as such terms are defined in, or subject to regulation under, the Investment Company Act of 1940, as amended and in effect from time to time.

 

Section 4.8.                                Taxes.  The Borrower and the Restricted Subsidiaries have timely filed or caused to be filed all Federal income tax returns and all other material tax returns that are required to be filed by them, and have paid all taxes shown to be due and payable on such returns or on any assessments made against it or its property and all other taxes, fees or other charges imposed on it or any of its property by any Governmental Authority, except where the same (i) could not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or (ii) are currently being contested in good faith by appropriate proceedings and for which the Borrower or such Restricted Subsidiary, as the case may be, has set aside on its books adequate reserves in accordance with GAAP.

 

Section 4.9.                                Margin Regulations.  None of the proceeds of any of the Loans will be used, directly or indirectly, for “purchasing” or “carrying” any “margin stock” within the respective meanings of each of such terms under Regulation U or for any purpose that violates the provisions of Regulation T, Regulation U or Regulation X.  Neither the Borrower nor any Restricted Subsidiary is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying “margin stock”.

 

Section 4.10.                         ERISA.  Except as could not reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect; (i) each Plan is in compliance in form and operation with its terms and with ERISA and the Code (including, without limitation, the Code provisions compliance with which is necessary for any intended favorable tax treatment) and all other applicable laws and regulations; (ii) each Plan (and each related trust, if any) which is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service to the effect that it meets the requirements of Sections 401(a) and 501(a) of the Code covering all applicable tax law changes, or is comprised of a master or prototype plan that has received a favorable opinion letter from the Internal Revenue Service, and nothing has occurred since the date of such determination that would adversely affect such determination (or, in the case of a Plan with no determination, nothing has occurred

 

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that would adversely affect the issuance of a favorable determination letter or otherwise adversely affect such qualification); (iii) no ERISA Event has occurred or is reasonably expected to occur; (iv) there exists no Unfunded Pension Liability with respect to any Plan; (v) none of the Borrower, any of its Subsidiaries or any ERISA Affiliate is making or accruing an obligation to make contributions, or has within any of the five calendar years immediately preceding the date this assurance is given or deemed given, made or accrued an obligation to make contributions to any Multiemployer Plan; (vi) there are no actions, suits or claims pending against or involving a Plan (other than routine claims for benefits) or, to the knowledge of the Borrower, any of its Subsidiaries or any ERISA Affiliate, threatened, which would reasonably be expected to be asserted successfully against any Plan; (vii) the Borrower, each of its Subsidiaries and each ERISA Affiliate have made all contributions to or under each Plan and Multiemployer Plan required by law within the applicable time limits prescribed thereby, the terms of such Plan or Multiemployer Plan, respectively, or by any contract or agreement requiring contributions to a Plan or Multiemployer Plan; (viii) no Plan which is subject to Section 412 of the Code or Section 302 of ERISA has applied for or received an extension of any amortization period, within the meaning of Section 412 of the Code or Section 303 or 304 of ERISA; and (ix) none of the Borrower, any of its Subsidiaries or any ERISA Affiliate have ceased operations at a facility so as to become subject to the provisions of Section 4068(a) of ERISA, withdrawn as a substantial employer so as to become subject to the provisions of Section 4063 of ERISA or ceased making contributions to any Plan subject to Section 4064(a) of ERISA to which it made contributions.

 

Section 4.11.                         Ownership of Property.

 

(a)                                 Except as would not reasonably be expected to have individually or in the aggregate, a Material Adverse Effect, the Borrower and each Restricted Subsidiary has good title to, or valid leasehold interests in, all of its real and personal property material to the operation of its business, including all such properties reflected in the most recent audited consolidated balance sheet of BPL referred to in Section 4.4 or purported to have been acquired by the Borrower or any Restricted Subsidiary after said date (except as sold or otherwise disposed of in the ordinary course of business), in each case free and clear of Liens other than Liens permitted under Section 7.1.  All leases that individually or in the aggregate are material to the business or operations of the Borrower and its Restricted Subsidiaries are valid and subsisting and are in full force, except as would not reasonably be expected to have a Material Adverse Effect.

 

(b)                                 Except as would not have a Material Adverse Effect, (i) the Borrower and each Restricted Subsidiary owns, or is licensed or otherwise has the right to use, all patents, trademarks, service marks, trade names, copyrights and other intellectual property material to its business as currently conducted, and (ii) the use thereof by the Borrower and its Restricted Subsidiaries does not infringe in any material respect on the rights of any other Person.

 

Section 4.12.                         Disclosure.  All written information (other than estimates and information of a general economic nature) concerning the General Partner, the Borrower and its Subsidiaries and any transactions contemplated hereby included in the Executive Summary or otherwise prepared by or on behalf of the foregoing or their representatives and made available to any Lender or the Administrative Agent in connection with the transactions contemplated hereby on or before the date hereof (the “Information”), when taken as a whole, as of the date such Information was furnished to the Lenders and as of the Closing Date, did not contain any untrue statement of a material fact as of such date or omit to state a material fact necessary in order to make the statements therein, taken as a whole, in 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; it being understood that such projected financial information, as to future events, are not to be viewed as facts and are subject to significant uncertainties and contingencies many of which are beyond the Borrower’s control, that actual results during the periods covered by any such projected financial information may differ significantly from the

 

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projected results and that such differences may be material and that such projected financial information is not a guarantee of financial performance.

 

Section 4.13.                         Sanctions and Anti-Corruption Laws.  The Borrower has implemented and maintains in effect and enforce policies and procedures designed to ensure compliance by the Borrower, its Subsidiaries and their respective officers, directors, employees and agents with Anti-Corruption Laws and applicable Sanctions.  To the extent applicable, the Borrower and its Subsidiaries and, to the knowledge of the Borrower, its officers, employees, directors, representatives and agents that will act in any capacity in connection with or benefit from the credit facility established hereby, are in compliance with Anti-Corruption Laws and all applicable Sanctions.  None of the Borrower, any Subsidiary of the Borrower nor, to the knowledge of any such Person, any directors or officers of the Borrower and any Subsidiary of the Borrower or any Affiliate of the Borrower (i) is a Sanctioned Person, (ii) has more than 15% of its assets in Sanctioned Countries, or (iii) derives more than 15% of its operating income from investments in, or transactions with, Sanctioned Persons or Sanctioned Countries.  No part of the proceeds of any Loans hereunder will be used directly or indirectly to fund any operations in, finance any investments or activities in or make any payments to a Sanctioned Person or a Sanctioned Country or otherwise be used in any manner that would, with respect to the Borrower, any Restricted Subsidiary of the Borrower or, to the knowledge of the Borrower, any other Person, result in the violation of any Anti-Corruption Laws or any Sanctions.

 

Section 4.14.                         Patriot Act.  Neither the Borrower nor any Restricted Subsidiary is an “enemy” or an “ally of the enemy” within the meaning of Section 2 of the Trading with the Enemy Act or any enabling legislation or executive order relating thereto.  Neither the Borrower nor any Restricted Subsidiary is in violation of (a) the Trading with the Enemy Act, (b) any of the foreign assets control regulations of the United States Treasury Department (31 C.F.R., Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto or (c) the Patriot Act.  The Borrower (i) is not a blocked person described in Section 1 of the Anti-Terrorism Order or (ii) to the best of its knowledge, does not engage in any dealings or transactions, or is otherwise associated, with any such blocked person.

 

ARTICLE V.

 

AFFIRMATIVE COVENANTS

 

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

 

Section 5.1.                                Financial Statements and Other Information.  The Borrower will deliver by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile or by email in accordance with Section 11.1 to the Administrative Agent (for prompt delivery to each Lender):

 

(a)                                 as soon as available and in any event within 120 days after the end of each Fiscal Year of BPL, a copy of the annual audited report for such Fiscal Year for BPL and its Subsidiaries, containing a consolidated balance sheet of BPL and its Subsidiaries as of the end of such Fiscal Year and the related consolidated statements of income, partners’ equity and cash flows (together with all footnotes thereto) of BPL and its Subsidiaries for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year (or, in the case of such balance sheet as of the end of the previous Fiscal Year), all in reasonable detail and reported on by Deloitte & Touche LLP or other independent public accountants of nationally recognized standing (without a “going concern” or like qualification, exception or explanation and without any qualification or exception as to scope of such audit) to the effect that such financial statements present fairly in all material respects the financial condition and the results of operations of BPL and its Subsidiaries for such Fiscal Year on a consolidated basis in accordance with GAAP and that the examination by such accountants in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards;

 

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(b)                                 (i) as soon as available and in any event within 60 days after the end of each Fiscal Quarter of BPL (other than the fourth Fiscal Quarter of each Fiscal Year), an unaudited consolidated and consolidating balance sheet of BPL and its Subsidiaries as of the end of such Fiscal Quarter and the related unaudited consolidated and consolidating statements of income and cash flows of BPL and its Subsidiaries for such Fiscal Quarter and the then elapsed portion of such Fiscal Year, setting forth in each case in comparative form the figures for the corresponding Fiscal Quarter and the corresponding portion of BPL’s previous Fiscal Year and (ii) as soon as available and in any event within 60 days after the end of each Fiscal Quarter of BES (other than the fourth Fiscal Quarter of each Fiscal Year, which shall be delivered concurrently with the reports referred to in subsection (a)), a detailed report of Hedged Eligible Inventory describing the hedging agreements to which each Buckeye Merchant Service Company and its Subsidiaries are a party, including the following information: (A) the type of product, (B) volume, (C) location, (D) schedule of inventory hedges in place (with counterparties and maturity dates) and (E) such other detailed information regarding such hedges as reasonably requested by the Administrative Agent and as well as an Accounts Receivable (as defined in the Revolving Credit Agreement) aging report for each Buckeye Merchant Service Company and its respective Subsidiaries.

 

(c)                                  concurrently with the delivery of the financial statements referred to in subsections (a) and (b)(i) of this Section, a Compliance Certificate signed by the principal executive officer or the principal financial officer of BPL (i) certifying as to whether there exists a Default or Event of Default on the date of such certificate and, if a Default or an Event of Default then exists, specifying the details thereof and the action taken or proposed to be taken with respect thereto, (ii) setting forth in reasonable detail calculations demonstrating compliance with the financial covenants set forth in Article VI, and (iii) stating whether any change in GAAP or the application thereof has occurred since the later of December 31, 2015 and the date of the prior Compliance Certificate that affects the Borrower’s financial statements, and if any such change has occurred, specifying the effect of such change on the financial statements accompanying such Compliance Certificate;

 

(d)                                 promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by the Borrower or any Restricted Subsidiary with the Securities and Exchange Commission, or any Governmental Authority succeeding to any or all functions of said Commission, or with any national securities exchange, or distributed by the Borrower to its shareholders generally, as the case may be; provided that the Borrower shall be deemed to have furnished the information specified in this clause (d) on the date that such information is posted at the Borrower’s website on the Internet or at such other website as notified to the Lenders:

 

(e)                                  together with the annual audited financial statements required pursuant to subsection (a) above, (i) a certificate of insurance describing the types and amounts of insurance (property and liability) maintained by BPL and its Subsidiaries, naming the Administrative Agent on behalf of the Lenders as additional insured and (ii) a copy of each Buckeye Merchant Service Company’s current Risk Management Policy;

 

(f)                                   promptly after Moody’s or S&P has changed any credit rating relevant for calculating the Applicable Margin or the Applicable Percentage, notice of such change; and

 

(g)                                  promptly following any reasonable request therefore by the Administrative Agent (on behalf of any Lender), such other information regarding the results of operations, business affairs and financial condition of the Borrower or any Restricted Subsidiary as the Administrative Agent (on behalf of any Lender) may reasonably request.

 

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Notwithstanding the foregoing, so long as the Borrower is required to file periodic reports under Section 13(a) or Section 15(d) of the Exchange Act, the obligations in paragraphs (a) and (b)(i) of this Section 5.1 shall be deemed satisfied upon the filing (within the applicable time period set forth above) of the Borrower’s (or any direct or indirect parent thereof), as applicable, Form 10-K or 10-Q, applicable, filed with the SEC.

 

Section 5.2.                                Notices of Material Events.  The Borrower will furnish by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile or by email in accordance with Section 11.1 to the Administrative Agent (for prompt delivery to each Lender) written notice of the following, promptly after any Responsible Officer of the Borrower has knowledge thereof:

 

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

 

(b)                                 the filing or commencement of, or any material development in, any action, suit or proceeding by or before any arbitrator or Governmental Authority against or, to the knowledge of the Borrower, affecting the Borrower or any Restricted Subsidiary as to which an adverse determination is reasonably probable and which, if adversely determined, would reasonably be expected to result in a Material Adverse Effect;

 

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

 

(d)                                 promptly and in any event within 15 days after (i) the Borrower, any of its Subsidiaries or any ERISA Affiliate knows or has reason to know that any ERISA Event has occurred, a certificate of the chief financial officer of the Borrower describing such ERISA Event and the action, if any, proposed to be taken with respect to such ERISA Event and a copy of any notice filed with the PBGC or the Internal Revenue Service pertaining to such ERISA Event and any notices received by the Borrower, any Subsidiary or any ERISA Affiliate from the PBGC or any other governmental agency with respect thereto, and (ii) becoming aware (1) that there has been a material increase in Unfunded Pension Liabilities (not taking into account Plans with negative Unfunded Pension Liabilities) since the date the representations hereunder are given or deemed given, or from any prior notice, as applicable, (2) of the existence of any Withdrawal Liability, or (3) of the adoption of, or the commencement of contributions to, any Plan subject to Section 412 of the Code by the Borrower, any of its Subsidiaries or any ERISA Affiliate, or (4) of the adoption of any amendment to a Plan subject to Section 412 of the Code which results in a material increase in contribution obligations of the Borrower, any of its Subsidiaries or any ERISA Affiliate, a detailed written description thereof from the chief financial officer of the Borrower;

 

(e)                                  the occurrence of any event of default, or the receipt by the Borrower or any Restricted Subsidiary of any written notice of an alleged default or event of default, with respect to any Material Indebtedness (including, without limitation, Indebtedness incurred under the Revolving Credit Agreement) of the Borrower or any Restricted Subsidiary; or

 

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

 

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

 

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proposed to be taken with respect thereto, and, in the occurrence of an event described in subsection (d) above, a copy of any notice filed with the PBGC or the Internal Revenue Service pertaining to such ERISA Event and any notices received by the Borrower, any Subsidiary or any ERISA Affiliate from the PBGC or any other governmental agency with respect thereto.

 

Section 5.3.                                Existence; Conduct of Business.  The Borrower will, and will cause each Restricted Subsidiary to, do or cause to be done all things reasonably necessary to preserve, renew and maintain in full force and effect its legal existence and its rights, licenses, permits, privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of its business, except as such would otherwise reasonably expire or be abandoned or permitted to lapse in the ordinary course of business or where the failure to do so (individually or collectively with all such failures other than maintenance of the Borrower’s existence) would not reasonably be expected to have a Material Adverse Effect; provided that nothing in this Section shall prohibit any merger, consolidation, liquidation or dissolution permitted under Section 7.2.

 

Section 5.4.                                Compliance with Laws.  The Borrower will, and will cause each Restricted Subsidiary to, comply with all Organizational Documents of such Person and all Requirements of Law applicable to its business and properties, except where the failure to do so, either individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

 

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

 

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

 

Section 5.7.                                Visitation and Inspection.  The Borrower will, and will cause each Restricted Subsidiary to, permit any representative of the Administrative Agent or any Lender to visit and inspect its properties, to examine its books and records and to make copies and take extracts therefrom, and to discuss its affairs, finances and accounts with any of its officers, all at such reasonable times and as often as the Administrative Agent or any Lender may reasonably request after reasonable prior notice to the Borrower; provided that, so long as no Event of Default has occurred and is continuing, the Borrower shall only be required to pay the reasonable fees and expenses of any such representative with respect to one such visit per year.

 

Section 5.8.                                Maintenance of Properties; Insurance.  The Borrower will, and will cause each Restricted Subsidiary to, (a) keep and maintain all property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted except where a failure to do so, individually or in the aggregate would not reasonably be expected to result in a Material Adverse Effect and (b) maintain with financially sound and reputable insurance companies, which are not Affiliates of the Borrower, insurance with respect to its properties and business, and the properties and business of its Subsidiaries, against loss or damage of the kinds customarily insured against by companies of established reputation engaged in the same or similar businesses and similarly situated, of such types and in such amounts as are customarily carried under similar circumstances by such other business.  Such insurance may include self-insurance or be subject to co-insurance, deductibility or similar clauses which, in effect, result in self-insurance of certain losses, provided that such self-insurance is in accord with the approved

 

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practices of business enterprises of established reputation similarly situated and adequate insurance reserves are maintained in connection with such self-insurance, and, notwithstanding the foregoing provisions of this Section, the Borrower or any Subsidiary may effect workers’ compensation or similar insurance in respect of operations in any state or other jurisdiction any through an insurance fund operated by such state or other jurisdiction or by causing to be maintained a system or systems of self-insurance in accord with applicable laws.

 

Section 5.9.                                Use of Proceeds.  The Borrower will use the proceeds of all Loans to repay existing Indebtedness, finance working capital needs, Acquisitions and capital expenditures, to make distributions and for other general corporate purposes of the Borrower and its Subsidiaries.  No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that would violate any rule or regulation of the Board of Governors of the Federal Reserve System, including Regulation T, Regulation U or Regulation X.

 

Section 5.10.                         Unrestricted Subsidiaries.

 

(a)                                 Each of the Subsidiaries listed on Exhibit B-2 is designated as an Unrestricted Subsidiary as of the Closing Date.  BPL may at any time designate any Restricted Subsidiary as an “Unrestricted Subsidiary” or an Unrestricted Subsidiary as a “Restricted Subsidiary” by written notice to the Administrative Agent so long as immediately before and after such designation no Default or Event of Default shall have occurred and be continuing or result therefrom.  Notwithstanding anything else herein to the contrary, any Unrestricted Subsidiary that has been re-designated as a Restricted Subsidiary may not be subsequently re-designated as an Unrestricted Subsidiary.  The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Liens of such Subsidiary existing at such time.  No Unrestricted Subsidiary shall be subject to or included within the scope of any provision herein or in any other Loan Document, including without limitation any representation, warranty, covenant or Event of Default herein or in any other Loan Document, except as set forth in this Section.

 

(b)                                 No Restricted Subsidiary shall guarantee or otherwise become liable in respect of any Indebtedness of, grant any Lien on any of its property (other than Equity Interests of an Unrestricted Subsidiary owned by such Restricted Subsidiary) to secure any Indebtedness of or other obligation of, or provide any other form of credit support to, any Unrestricted Subsidiary, other than Guarantees for the benefit of Unrestricted Subsidiaries not to exceed $25,000,000 at any one time outstanding.

 

(c)                                  Notwithstanding the foregoing, (i) the General Partner shall remain a Restricted Subsidiary at all times and (ii) each Subsidiary constituting a “Restricted Subsidiary” (as defined in the Revolving Credit Agreement) shall be a Restricted Subsidiary.

 

ARTICLE VI.

 

FINANCIAL COVENANTS

 

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

 

Section 6.1.                                Leverage Ratio.  The Borrower will not permit the Leverage Ratio as of the last day of any Fiscal Quarter to exceed 5.00 to 1.00 (the “Required Threshold”), provided, however, that to the extent that the Borrower or any of its Restricted Subsidiaries (i) consummates (A) during any Fiscal Quarter (including any Fiscal Quarter that occurred prior to the Closing Date), an individual Acquisition for which the aggregate consideration is $50,000,000 or more (to the extent that the Borrower makes an Increase Election in respect thereof, a “Material Acquisition”) or (B) in any twelve-month period, one or

 

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more Acquisitions (excluding Material Acquisitions) for which the aggregate consideration is $100,000,000 or more and (ii) notifies the Administrative Agent that the Borrower elects to increase the Required Threshold as a result thereof (an “Increase Election”), which notice may be given by the Borrower at any time, then the Required Threshold for such Fiscal Quarter in which such individual Acquisition described in clause (A) occurred or in which the aggregate consideration for such Acquisitions described in clause (B) equaled or exceeded $100,000,000 and in either case the immediately three following Fiscal Quarters shall be increased to 5.50:1.00.

 

ARTICLE VII.

 

NEGATIVE COVENANTS

 

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

 

Section 7.1.                                Liens.  The Borrower will not, and will not permit any of its Restricted Subsidiaries to, create, incur, assume or suffer to exist any Lien securing Indebtedness on any of their assets or property now owned or hereafter acquired except:

 

(a)                                 Liens securing the obligations under the Revolving Credit Agreement and any refinancings, refundings, replacements, renewals and extensions thereof (which Liens may, if required as a condition to the granting or acceptance thereof, also secure, on a pari passu basis, any Hedging Obligations with lenders under the Revolving Credit Agreement or their Affiliates); provided that such Liens are granted only on assets or property of the Borrower or any Restricted Subsidiary that are subject to Liens securing the Obligations on a pari passu basis and do not extend to any other property or assets;

 

(b)                                 Liens securing the Obligations (which Liens may, if required as a condition to the granting or acceptance thereof, also secure, on a pari passu basis, any Hedging Obligations with Lenders or their Affiliates);

 

(c)                                  purchase money Liens upon or in any assets acquired, constructed or improved by the Borrower or any Restricted Subsidiary to secure the purchase price or the cost of construction or improvement of such assets or to secure Indebtedness incurred solely for the purpose of financing the acquisition, construction or improvement of such assets (including Liens securing any Capital Lease Obligations); provided that (i) such Lien attaches to such asset concurrently or within 270 days after the acquisition or the completion of the construction, repair, renovation, replacement or improvement (as applicable) thereof; (ii) any such Lien does not extend to any other asset; and (iii) the Indebtedness secured thereby does not exceed the cost of acquiring, constructing or improving such fixed or capital assets;

 

(d)                                 Liens on Equity Interests of Unrestricted Subsidiaries or joint ventures securing Indebtedness of such Unrestricted Subsidiary or joint venture;

 

(e)                                  Liens on cash and cash equivalents under or with respect to accounts with brokers or counterparties with respect to Hedging Transactions consisting of cash, commodities or futures contracts, options, securities, instruments and other like assets securing only Hedging Transactions; and

 

(f)                                   Liens not otherwise permitted herein that secure Indebtedness in an aggregate principal amount not to exceed at any time outstanding 15% of Consolidated Net Tangible Assets;

 

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provided, that so long as any Buckeye Merchant Service Company is a borrower under the Revolving Credit Agreement, neither such Buckeye Merchant Service Company nor any of its Subsidiaries may create, incur, assume or suffer to exist any Lien on any of their assets or property now owned or hereafter acquired, other than (i) Permitted Encumbrances, (ii) Liens permitted pursuant to clause (a) above, (iii) purchase money Liens securing Indebtedness for equipment acquired in the ordinary course of business not to exceed $1,000,000 in an aggregate principal amount at any one time outstanding; provided that such Liens do not encumber any property other than the property financed by such Indebtedness; and (iv)  other Liens that secure Indebtedness or other obligations in an aggregate amount not to exceed $10,000,000.

 

Section 7.2.                                Fundamental Changes.

 

(a)                                 The Borrower will not merge into or consolidate into any other Person, or permit any other Person to merge into or consolidate with it, or sell, lease, transfer or otherwise dispose of (in a single transaction or a series of transactions) all or substantially all of its assets (in each case, whether now owned or hereafter acquired) or liquidate or dissolve; provided that if at the time thereof and immediately after giving effect thereto, no Event of Default shall have occurred and be continuing, any Person may merge or consolidate with or into the Borrower in a transaction in which the surviving Person is (A) the Borrower or (B) another Person organized or existing under the laws of the United States of America, any State thereof or the District of Columbia and such Person expressly assumes all the obligations of the Borrower under the Loan Documents, pursuant to an assumption agreement reasonably acceptable to the Administrative Agent, in which event such Person will succeed to, and be substituted for, the Borrower.

 

(b)                                 The Borrower and the Restricted Subsidiaries, taken as a whole, will not engage to any material extent in any business other than (i) businesses of the type conducted by the Borrower and the Restricted Subsidiaries on the date hereof and businesses reasonably related, complementary or ancillary thereto or (ii) other businesses generating “qualifying income” under the Code (for the avoidance of doubt no business shall be considered to be not reasonably related, complementary or ancillary to the current business of the Borrower solely by virtue of being conducted in a jurisdiction other than the United States of America or Canada).

 

Section 7.3.                                Restricted Payments.  BPL will not make any Restricted Payment, if an Event of Default pursuant to Section 8.1(a), (b), (d) (with respect to Article VI), (e), (h), (i) or (j) has occurred and is continuing or would result therefrom.

 

Section 7.4.                                Transactions with Affiliates.  The Borrower will not, and will not permit any of its Restricted Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of their Affiliates, except (a) transactions, or a series of transactions, taken as a whole, that are at prices and on terms and conditions not less favorable to the Borrower or such Restricted Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties, (b) transactions between or among the General Partner, the Borrower and any Restricted Subsidiary not involving any other Affiliates, (c) any Restricted Payment permitted by Section 7.3, (d) investments in Unrestricted Subsidiaries (including Guarantees permitted by Section 5.10(b)) or joint ventures, (e) transactions contemplated by the Buckeye Partnership Agreement, (f) the payment of reasonable fees to members of the board of directors (or similar governing body) of the General Partner, the Borrower or any Restricted Subsidiary who are not employees of the General Partner, the Borrower or any such Restricted Subsidiary, (g) compensation and employee benefit arrangements paid to, and indemnities provided for the benefit of, directors, officers or employees of the General Partner, the Borrower or its Restricted Subsidiaries in the ordinary course of business, (h) any issuances of securities or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment agreements, stock options and stock ownership plans approved by the board of directors (or similar governing body) of the General Partner, the Borrower or any Restricted Subsidiary and (i) transactions that, in the aggregate, involve consideration of less than

 

50

 

$10,000,000 and are not otherwise material to the business of BPL and the Restricted Subsidiaries, taken as a whole.

 

Section 7.5.                                Restrictive Agreements.  The Borrower will not, and will not permit any Restricted Subsidiary to, directly or indirectly, enter into, incur or permit to exist any agreement that prohibits, restricts or imposes any condition upon the ability of any Restricted Subsidiary to pay dividends or other distributions with respect to its Equity Interests, to make or repay loans or advances to the Borrower or any other Restricted Subsidiary or to transfer any of its property or assets to the Borrower or any other Restricted Subsidiary; provided that (i) the foregoing shall not apply to restrictions or conditions imposed by this Agreement or any other Loan Document, (ii) the foregoing shall not apply to restrictions or conditions imposed by the Revolving Credit Agreement or any other “Loan Document” (as defined therein), (iii) the foregoing shall not apply to restrictions and conditions existing on the date hereof identified on Schedule 7.5 (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (iv) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Restricted Subsidiary pending such sale, so long as such restrictions and conditions apply only to the Restricted Subsidiary that is to be sold and such sale is permitted hereunder and (v) the foregoing shall not apply to any other agreement if BPL reasonably concludes that the entering into such agreement could not reasonably be expected to result in the failure of the Borrower to comply with Section 6.1, for purposes of this clause (v), there being excluded from Consolidated Net Income the net income of any Subsidiary of BPL to the extent that the declaration or payment of dividends or distributions with respect to its Equity Interests, or its ability to make or repay loans or advances to BPL or any Subsidiary thereof or to transfer any of its property or assets to BPL or any Subsidiary thereof is at the time prohibited by the operation of such agreement.

 

Section 7.6.                                Accounting Changes.  The Borrower will not, and will not permit any of its Subsidiaries to, make any significant change in accounting treatment or reporting practices, except as permitted or required by GAAP, or change the fiscal year of BPL or of any of its Restricted Subsidiaries, except to change the fiscal year of a Restricted Subsidiary to conform its fiscal year to that of BPL.

 

Section 7.7.                                Government Regulation.  The Borrower will not, and will not permit any Restricted Subsidiary to, (a) be or become subject at any time to any law, regulation, or list of any Government Authority of the United States (including, without limitation, the U.S. Office of Foreign Asset Control list) that prohibits or limits the Lenders or the Administrative Agent from making any advance or extension of credit to the Borrower or from otherwise conducting business with the Borrower, (b) use the proceeds of any Loan to fund any activities that at the time of such funding would, directly or indirectly, result in the violation of any Anti-Corruption Laws or Sanctions by the Borrower, any Restricted Subsidiary of the Borrower or, to the knowledge of any such Person, any other Person, or (c) fail to provide documentary and other evidence of the identity of the Borrower as may be requested by the Lenders or the Administrative Agent at any time to enable the Lenders or the Administrative Agent to verify the identity of the Borrower or to comply with any applicable law or regulation, including, without limitation, Section 326 of the Patriot Act at 31 U.S.C. Section 5318.  The Borrower shall maintain in effect and enforce policies and procedures designed to ensure compliance by the Borrower and all Subsidiaries of the Borrower and their respective officers, directors, employees and agents with Anti-Corruption Laws and applicable Sanctions.

 

ARTICLE VIII.

 

EVENTS OF DEFAULT

 

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

 

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

 

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

 

(c)                                  any representation or warranty made or deemed made by or on behalf of the Borrower or any Restricted Subsidiary in or in connection with this Agreement or any other Loan Document shall prove to be incorrect in any material respect (other than any representation or warranty that is expressly qualified by a Material Adverse Effect or other materiality, in which case such representation or warranty shall prove to be incorrect in any respect) when made or deemed made or submitted; or

 

(d)                                 the Borrower shall fail to observe or perform any covenant or agreement contained in Section 5.2(a), or 5.3 (with respect to the Borrower’s legal existence) or Article VI or VII; or

 

(e)                                  the Borrower shall fail to observe or perform any covenant contained in Section 5.1(a), (b) or (c), and such failure shall remain unremedied for five (5) days; or

 

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

 

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

 

(h)                                 the Borrower or any Material Subsidiary shall (i) commence a voluntary case or other proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a custodian, trustee, receiver, liquidator or other similar official of it or any substantial part of its property, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (i) of this subsection, (iii) apply for or consent to the appointment of a custodian, trustee, receiver, liquidator or other

 

52

 

similar official for the Borrower or any such Material Subsidiary or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors, or (vi) take any action for the purpose of effecting any of the foregoing; or

 

(i)                                     an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any Material Subsidiary or its debts, or any substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency or other similar law now or hereafter in effect or (ii) the appointment of a custodian, trustee, receiver, liquidator or other similar official for the Borrower or any Material Subsidiary or for a substantial part of its assets, and in any such case, such proceeding or petition shall remain undismissed for a period of 60 days or an order or decree approving or ordering any of the foregoing shall be entered; or

 

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

 

(k)                                 (i) an ERISA Event shall have occurred that, when taken together with other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect; (ii) there is or arises an aggregate Unfunded Pension Liability (determined by totaling the Unfunded Pension Liability of all Plans with a positive Unfunded Pension Liability), that would reasonably be expected to result in a Material Adverse Effect; or (iii) there is or arises any Withdrawal Liability, in an aggregate amount, that would reasonably be expected to result in a Material Adverse Effect; or

 

(l)                                     any judgment or order for the payment of money in excess of $75,000,000 in the aggregate shall be rendered against the Borrower or any Material Subsidiary, and either (i) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (ii) there shall be a period of 30 consecutive days during which either a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect or such judgment or order shall not be satisfied in full; or

 

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

 

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

 

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

 

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ARTICLE IX.

 

THE ADMINISTRATIVE AGENT

 

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

 

Section 9.2.                                Nature of Duties of Administrative Agent.  The Administrative Agent shall not have any duties or obligations except those expressly set forth in this Agreement and the other Loan Documents.  Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or an Event of Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except those discretionary rights and powers expressly contemplated by the Loan Documents that the Administrative Agent is required to exercise in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 11.2), and (c) except as expressly set forth in the Loan Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by the Administrative Agent or any of its Affiliates in any capacity.  The Administrative Agent shall not be liable for any action taken or not taken by it, its sub-agents or its attorneys-in-fact with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 11.2) or in the absence of its own gross negligence or willful misconduct.  The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents or attorneys-in-fact selected by it with reasonable care.  The Administrative Agent shall not be deemed to have knowledge of any Default or Event of Default unless and until written notice thereof (which notice shall include an express reference to such event being a “Default” or “Event of Default” hereunder) is given to the Administrative Agent by the Borrower or any Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements, or other terms and conditions set forth in any Loan Document, (iv) the validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article III or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.  The Administrative Agent may consult with legal counsel (including counsel for the Borrower) concerning all matters pertaining to such duties.

 

Section 9.3.                                Lack of Reliance on the Administrative Agent.  Each of the Lenders acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.  Each of the Lenders also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, continue to make its own decisions in taking or

 

54

 

not taking any action under or based on this Agreement, any related agreement or any document furnished hereunder or thereunder.

 

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

 

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

 

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

 

Section 9.7.                                Successor Administrative Agent.

 

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

 

(b)                                 Upon the acceptance of its appointment as the Administrative Agent hereunder by a successor, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents.  If, within 45 days after written notice is given of the retiring Administrative Agent’s resignation under this Section, no successor Administrative Agent shall have been appointed and shall have accepted such appointment, then on such 45th day (i) the retiring Administrative Agent’s resignation shall become effective, (ii) the retiring Administrative Agent shall thereupon be discharged from its duties and obligations under the Loan Documents and (iii) the Required Lenders shall thereafter perform all duties of the retiring

 

55

 

Administrative Agent under the Loan Documents until such time as the Required Lenders appoint a successor Administrative Agent as provided above.  After any retiring Administrative Agent’s resignation hereunder, the provisions of this Article shall continue in effect for the benefit of such retiring Administrative Agent and its representatives and agents in respect of any actions taken or not taken by any of them while it was serving as the Administrative Agent.

 

Section 9.8.                                Withholding Tax.

 

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

 

(b)                                 Without duplication of any indemnity provided under subsection (a) of this Section, each Lender shall also indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes or Other Taxes attributable to such Lender (to the extent that the Administrative Agent has not already been reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 10.4(d) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error.  Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this subsection.

 

Section 9.9.                                Administrative Agent May File Proofs of Claim.

 

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

 

(i)                                     to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans 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 and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and its agents and counsel and all other amounts due the Lenders and the Administrative Agent under Section 11.3) allowed in such judicial proceeding; and

 

56

 

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

 

(b)                                 any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, if the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Section 11.3.

 

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

 

Section 9.10.                         Authorization to Execute other Loan Documents.  Each Lender hereby authorizes the Administrative Agent to execute on behalf of all Lenders all Loan Documents other than this Agreement (or any amendments to this Agreement).

 

ARTICLE X.  RESERVED

 

ARTICLE XI.
 MISCELLANEOUS

 

Section 11.1.                         Notices.

 

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

 

To the Borrower:                                                                                                    Buckeye Partners, L.P.
 1 Greenway Plaza, 
 Suite 600
 Houston, TX 77046
 Attention: Assistant Treasurer 
 Telecopy Number: 832.615.8602
 Email: mhugetz@buckeye.com

 

With a copy to:                                                                                                            Buckeye Partners, L.P.
 1 Greenway Plaza, 
 Suite 600
 Houston, TX 77046
 Attention: Chief Financial Officer 
 Email: KStClair@buckeye.com

 

and

 

57

 

Pamela Kellet 
 Latham & Watkins LLP 
 811 Main Street 
 Suite 3700 
 Houston, TX 77002 
 Direct Dial: +1.713.546.7470 
 Fax: +1.713.546.5401 
 Email: pamela.kellet@lw.com 
 http://www.lw.com

 

To the Administrative Agent:                                   SunTrust Bank
 3333 Peachtree Road., 8th Floor
 Mail Code — GA-ATL-1929
 Atlanta, Georgia 30326
 Attention: Carmen Malizia
 Telecopy Number: (404) 439-7470

Email: Carmen.malizia@suntrust.com

 

With a copy to:                                                                                                            SunTrust Bank
 Agency Services 
 303 Peachtree Street, N.E. / 25th Floor
 Atlanta, Georgia 30308
 Attention: Doug Weltz
 Telecopy Number: (404) 221-2001
 Email: agency.services@suntrust.com

 

and

 

King & Spalding LLP
 1180 Peachtree Street, N.W.
 Atlanta, Georgia 30309
 Attention: Carolyn Z. Alford
 Telecopy Number: (404) 572-5100
 Email: czalford@kslaw.com

 

To any other Lender:                                                                             the address set forth in the Administrative Questionnaire or the Assignment and Acceptance executed by such Lender

 

Any party hereto may change its address, telecopy number or electronic mail address for notices and other communications hereunder by notice to the other parties hereto.  All such notices and other communications shall be effective upon actual receipt by the relevant Person or, if delivered by overnight courier service, upon the first Business Day after the date deposited with such courier service for overnight (next-day) delivery or, if sent by telecopy, upon transmittal in legible form by facsimile machine, or if delivered by electronic mail or other telecommunications device, when received at an e-mail address provided in clause (a), or, if mailed, upon the third Business Day after the date deposited into the mail or, if delivered by hand, upon delivery; provided, that notices delivered to the Administrative Agent shall not be effective until actually received by such Person at its address specified in this Section.  All 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 above of notification that such notice or communication is available and identifying the website address therefor.

 

(b)                                 Any agreement of the Administrative Agent or any Lender herein to receive certain notices by telephone or facsimile is solely for the convenience and at the request of the

 

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Borrower.  The Administrative Agent and each Lender shall be entitled to rely on the authority of any Person purporting to be a Person authorized by the Borrower to give such notice and the Administrative Agent and the Lenders shall not have any liability to the Borrower or other Person on account of any action taken or not taken by the Administrative Agent or any Lender in reliance upon such telephonic or facsimile notice.  The obligation of the Borrower to repay the Loans and all other Obligations hereunder shall not be affected in any way or to any extent by any failure of the Administrative Agent or any Lender to receive written confirmation of any telephonic or facsimile notice or the receipt by the Administrative Agent or any Lender of a confirmation which is at variance with the terms understood by the Administrative Agent or such Lender to be contained in any such telephonic or facsimile notice.

 

Section 11.2.                         Waiver; Amendments.

 

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

 

(b)                                 No amendment or waiver of any provision of this Agreement or of the other Loan Documents (other than the Fee Letter), nor consent to any departure by the Borrower therefrom, shall in any event be effective unless the same shall be in writing and signed by the Borrower and the Required Lenders, or the Borrower and the Administrative Agent with the consent of the Required Lenders, and then such amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided that, in addition to the consent of the Required Lenders, no amendment, waiver or consent shall:

 

(i)                                     increase the Commitment of any Lender without the written consent of such Lender;

 

(ii)                                  Reserved;

 

(iii)                               reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected thereby (it being understood that a waiver of default interest shall not constitute a reduction of the interest rate);

 

(iv)                              postpone the date fixed for any payment of any principal of, or interest on, any Loan or any fees hereunder or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date for the termination or reduction of any Commitment, without the written consent of each Lender affected thereby;

 

(v)                                 change Section 2.20(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender; or

 

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(vi)                              change any of the provisions of this subsection (b) or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders which are required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the consent of each Lender;

 

provided, further, that no such amendment, waiver or consent shall amend, modify or otherwise affect the rights, duties or obligations of the Administrative Agent without the prior written consent of such Person.

 

(c)                                  Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of such Lender may not be increased, the Maturity Date may not be extended and, except as otherwise set forth herein, amounts payable to such Lender hereunder may not be permanently reduced, in each case without the consent of such Lender (other than reductions in fees and interest in which such reduction does not disproportionately affect such Lender).

 

(d)                                 Notwithstanding anything to the contrary herein, this Agreement may be amended (or amended and restated) without the consent of any Lender (but with the consent of the Borrower and the Administrative Agent) if, upon giving effect to such amendment and restatement, such Lender shall no longer be a party to this Agreement (as so amended and restated), the Commitments of such Lender shall have terminated (but such Lender shall continue to be entitled to the benefits of Sections 2.17, 2.18, 2.19 and 10.3), such Lender shall have no other commitment or other obligation hereunder and such Lender shall have been paid in full all principal, interest and other amounts owing to it or accrued for its account under this Agreement.

 

(e)                                  Notwithstanding anything to the contrary herein, this Agreement may be amended (or amended and restated) with the written consent of the Required Lenders, the Administrative Agent, and the Borrower (i) to add one or more additional credit facilities to this Agreement, to permit the extensions of credit from time to time outstanding thereunder and the accrued interest and fees in respect thereof to share ratably in the benefits of this Agreement and the other Loan Documents with the Loans and any Commitments and the accrued interest and fees in respect thereof and to include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders and (ii) to change, modify or alter Section 2.20(b) or (c) or any other provision hereof relating to pro rata sharing of payments among the Lenders to the extent necessary to effectuate any of the amendments (or amendments and restatements) enumerated in subsection (d) or (e)(i) of this Section.

 

Section 11.3.                         Expenses; Indemnification.

 

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

 

(b)                                 The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all

 

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losses, claims, damages, liabilities and related expenses (including the reasonable and documented out-of-pocket 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 arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or the use or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or Release of Hazardous Materials on or from any property owned or operated by the Borrower or any of their Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of their 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, 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 are Taxes or are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from (i) the gross negligence, bad faith or willful misconduct of such Indemnitee, (ii) a claim brought by the Borrower against an Indemnitee for material breach in bad faith of such Indemnitee’s obligations under any of the Loan Documents, or (iii) disputes arising solely between Indemnitees and not (x) involving any action or inaction by the Borrower or any of their subsidiaries or (y) relating to any action of such Indemnitee in its capacity as Administrative Agent or Joint Lead Arranger.  No Borrower shall, without the prior written consent of any Indemnitee, effect any settlement of any pending or threatened proceeding in respect of which such Indemnitee is a party and indemnity has been sought hereunder by such Indemnitee, unless such settlement includes an unconditional release of such Indemnitee from all liability on claims that are the subject matter of such indemnity and does not include any admission of liability.  No Indemnitee shall be liable for any damages arising from the use by others of any information or other materials obtained through Syndtrak, Intralinks or any other Internet or intranet website, except as a result of such Indemnitee’s gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final and non-appealable judgment.

 

(c)                                  To the extent that the Borrower fails to pay any amount required to be paid to the Administrative Agent under subsection (a) or (b) hereof, each Lender severally agrees to pay to the Administrative Agent such Lender’s pro rata share (in accordance with its Commitment determined as of the time that the unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified payment, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent in its capacity as such.

 

(d)                                 To the extent permitted by applicable law, neither the Borrower nor any Indemnitee shall assert, and each hereby waives, any claim, on any theory of liability, for special, indirect, consequential, exemplary or punitive damages (including any loss of profits, business or anticipated savings),as opposed to actual or direct 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 therein, any Loan or the use of proceeds thereof, provided, however, that the foregoing waiver shall not limit the indemnification obligations of the Borrower.

 

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

 

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Section 11.4.                         Successors and Assigns.

 

(a)                                 The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that (other than to the extent permitted by Section 7.2) no Borrower 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 or (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 and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)                                 Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitments and Loans); 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 Commitments and 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 and the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Acceptance, as of the Trade Date) shall not be less than $5,000,000 with respect to the aggregate amount of Loans and Commitments and in minimum increments of $1,000,000, 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).

 

(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 Commitments assigned.

 

(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 or delayed) shall be required unless (x) an Event of Default pursuant to Section 8.1(a), (b), (h), (i) or (j)  has occurred and is continuing at the time of such assignment or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided that the Borrower shall be deemed to have consented to any assignment unless they shall object thereto by written notice to the Administrative Agent within five (5)

 

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Business Days after notice thereof has actually been delivered by the assigning Lender (through the Administrative Agent) to the Borrower; and

 

(B)                               the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for all assignments, other than assignments to (i) another Lender with a Commitment that is not a Defaulting Lender, (ii) an Affiliate of any such Lender or (iii) an Approved Fund of any such Lender.

 

(iv)                              Assignment and Acceptance.  The parties to each assignment shall (A) execute and deliver to the Administrative Agent an Assignment and Acceptance via an electronic settlement platform, or manually if previously confirmed, together with a processing and recordation fee of $3,500 payable by the assignee unless waived in the sole discretion of the Administrative Agent, (B) deliver an Administrative Questionnaire unless the assignee is already a Lender and (C) deliver the documents required under Section 2.19(e) and (f).

 

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

 

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

 

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 Acceptance, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 2.17, 2.18, 2.19 and 10.3 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided that, except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lender’s having been a Defaulting Lender.  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)                                  The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at one of its offices in Atlanta, Georgia a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amount of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  Information contained in the Register with respect to such Lender shall be available for inspection by such Lender at any reasonable time and from time to time upon reasonable prior notice; information contained in the Register shall also be available for inspection by the Borrower at any reasonable time and from time to time upon reasonable prior notice.  In establishing and maintaining the Register, the Administrative Agent shall serve as the Borrower’s agent solely for tax purposes and solely with respect to the actions described in this Section, and the Borrower hereby agrees that, to the extent SunTrust Bank serves in such capacity, SunTrust Bank and its officers, directors, employees, agents, sub-agents and affiliates shall constitute “Indemnitees”.

 

(d)                                 Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person, the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a

 

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portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.

 

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver with respect to the following to the extent affecting such Participant: (i) increase the Commitment of such Lender; (ii) reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder; (iii) postpone the date fixed for any payment of any principal of, or interest on, any Loan or any fees hereunder or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date for the termination or reduction of any Commitment; (iv) change Section 2.20(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby; or (v) change any of the provisions of Section 11.2(b) or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders which are required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder.  Subject to subsection (e) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.17, 2.18, and 2.19 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section; provided that such Participant agrees to be subject to Section 2.19(e) and Section 2.21 as though it were a Lender.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 11.7 as though it were a Lender; provided that such Participant agrees to be subject to Section 2.20 as though it were a Lender.

 

Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register in the United States on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans or other obligations under any Loan Document) except to the extent that such disclosure is necessary to establish that such commitment, loan or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.  The entries in the Participant Register shall be conclusive, absent manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.

 

(e)                                  A Participant shall not be entitled to receive any greater payment under Section 2.17 and Section 2.19 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 shall not be entitled to the benefits of Section 2.19 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.19(e) and (f) as though it were a Lender.

 

(f)                                   Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including, without limitation, any pledge or assignment to secure obligations to a Federal Reserve Bank or any other central bank having jurisdiction over such Lender; provided that no such pledge or assignment

 

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shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

 

Section 11.5.                         Governing Law; Jurisdiction; Consent to Service of Process.

 

(a)                                 This Agreement and the other Loan Documents and any claim, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be construed in accordance with and be governed by the law of the State of New York (without giving effect to the conflict of law principles thereof except for Sections 5-1401 and 5-1402 of the New York General Obligations Law).

 

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

 

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

 

(d)                                 Each party to this Agreement irrevocably consents to the service of process in the manner provided for notices in Section 11.1.  Nothing in this Agreement or in any other Loan Document will affect the right of any party hereto to serve process in any other manner permitted by law.

 

Section 11.6.                         WAIVER OF JURY TRIAL.  EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

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Section 11.7.                         Right of Setoff.  In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, each Lender shall have the right, at any time or from time to time upon the occurrence and during the continuance of an Event of Default, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent permitted by applicable law, to set off and apply against all deposits (general or special, time or demand, provisional or final) of the Borrower at any time held or other obligations at any time owing by such Lender to or for the credit or the account of the Borrower against any and all Obligations held by such Lender, irrespective of whether such Lender shall have made demand hereunder and although such Obligations may be unmatured.  Each Lender agrees promptly to notify the Administrative Agent and the Borrower after any such set-off and any application made by such Lender; provided that the failure to give such notice shall not affect the validity of such set-off and application.  Each Lender agrees to apply all amounts collected from any such set-off to the Obligations before applying such amounts to any other Indebtedness or other obligations owed by the Borrower and any of its Subsidiaries to such Lender.

 

Section 11.8.                         Counterparts; Integration.  This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  This Agreement, the Fee Letter, the other Loan Documents, and any separate letter agreement(s) relating to any fees payable to the Administrative Agent and its Affiliates constitute the entire agreement among the parties hereto and thereto and their affiliates regarding the subject matters hereof and thereof and supersede all prior agreements and understandings, oral or written, regarding such subject matters.  Delivery of an executed counterpart to this Agreement or any other Loan Document by facsimile transmission or by electronic mail in pdf format shall be as effective as delivery of a manually executed counterpart hereof.

 

Section 11.9.                         Survival.  All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates, reports, notices or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as the Commitments have not expired or terminated.  The provisions of Sections 2.17, 2.18, 2.19, and 11.3 and Article IX shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans and all other Obligations, the expiration or termination of the Commitments or the termination of this Agreement or any provision hereof.

 

Section 11.10.                  Severability.  Any provision of this Agreement or any other Loan Document held to be illegal, invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be ineffective to the extent of such illegality, invalidity or unenforceability without affecting the legality, validity or enforceability of the remaining provisions hereof or thereof; and the illegality, invalidity or unenforceability of a particular provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

Section 11.11.                  Confidentiality.  Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of any information relating to the Borrower or any of its Subsidiaries or any of its businesses provided to it by the Borrower or any of its Subsidiaries, other than any such information that is available to the Administrative Agent or any Lender on a non-confidential basis prior to disclosure by the Borrower or any of its Subsidiaries, except that such information may be disclosed (i) to any Related Party of the Administrative Agent or any such Lender including, without limitation, accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such information and be instructed to keep such information confidential), (ii) to the extent required by applicable law, compulsory legal process or regulation or as

 

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requested or required by any governmental or regulatory agency or authority purporting to have jurisdiction over it (including any self-regulatory authority such as the National Association of Insurance Commissioners) (iii) to the extent that such information becomes publicly available other than as a result of a breach of this Section, or which becomes available to the Administrative Agent, any Lender or any Related Party of any of the foregoing on a non-confidential basis from a source other than the Borrower or any of its Subsidiaries that the Administrative Agent, Lender or Related Party reasonably believes not to be in violation of confidentiality limitations, (iv) in connection with the exercise of any remedy hereunder or under any other Loan Documents or any suit, action or proceeding relating to this Agreement or any other Loan Documents or the enforcement of rights hereunder or thereunder, (v) subject to execution by such Person of an agreement containing provisions substantially the same as those of this Section, to (A) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, or (B) any actual or prospective party (or its Related Parties) to any swap or derivative or other transaction under which payments are to be made by reference to the Borrower and its obligations, this Agreement or payments hereunder, (vi) to any rating agency, (vii) to the CUSIP Service Bureau or any similar organization, or (viii) with the consent of the Borrower.  In addition, the Administrative Agent and any Lender may disclose the existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry, and service providers to the Administrative Agent and the Lenders in connection with the administration of this Agreement, the other Loan Documents and the Commitments.  Any Person required to maintain the confidentiality of any information as provided for 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 its own confidential information.   In the event of any conflict between the terms of this Section and those of any other Contractual Obligation entered into with the Borrower (whether or not a Loan Document), the terms of this Section shall govern.

 

Section 11.12.                  Interest Rate Limitation.  Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which may be treated as interest on such Loan under applicable law (collectively, the “Charges”), shall exceed the maximum lawful rate of interest (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by a Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Rate to the date of repayment (to the extent permitted by applicable law), shall have been received by such Lender.

 

Section 11.13.                  Waiver of Effect of Corporate Seal.  The Borrower represents and warrants it is not required to affix its corporate seal to this Agreement or any other Loan Document pursuant to its Organizational Documents or any Requirement of Law, agrees that this Agreement is delivered by the Borrower under seal and waives any shortening of the statute of limitations that may result from not affixing the corporate seal to this Agreement or such other Loan Documents.

 

Section 11.14.                  Patriot Act.  The Administrative Agent and each Lender hereby notifies the Borrower that, pursuant to the requirements of the Patriot 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 Patriot Act.

 

Section 11.15.                  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 acknowledges and agrees and

 

67

 

acknowledges its Affiliates’ understanding that (i) (A) the services regarding this Agreement provided by the Administrative Agent and/or the Lenders are arm’s-length commercial transactions between the Borrower and its Affiliates, on the one hand, and the Administrative Agent and the Lenders, on the other hand, (B) the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent they have deemed appropriate, and (C) the Borrower is capable of evaluating and understanding, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) each of the Administrative Agent and the Lenders 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 or any of its Affiliates, or any other Person, and (B) neither the Administrative Agent nor any Lender has any obligation to the Borrower or any of its Affiliates with respect to the transaction contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii)  the Administrative Agent, the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower and its Affiliates, and each of the Administrative Agent and the Lenders has no obligation to disclose any of such interests to the Borrower or any of its Affiliates.  To the fullest extent permitted by law, the Borrower hereby waives and releases any claims that it may have against the Administrative Agent or any Lender with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

 

Section 11.16.                  Location of Closing.  Each Lender acknowledges and agrees that it has delivered, with the intent to be bound, its executed counterparts of this Agreement to the Administrative Agent, c/o King & Spalding LLP, 1185 Avenue of the Americas, New York, New York 10036.  The Borrower acknowledges and agrees that it has delivered, with the intent to be bound, its executed counterparts of this Agreement and each other Loan Document, together with all other documents, instruments, opinions, certificates and other items required under Section 3.1, to the Administrative Agent, c/o King & Spalding LLP, 1185 Avenue of the Americas, New York, New York 10036.  All parties agree that the closing of the transactions contemplated by this Agreement has occurred in New York.

 

(remainder of page left intentionally blank)

 

68

 

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

 

 

	
 
    	
BUCKEYE PARTNERS, L.P.
    
	
 
    	
 
    
	
 
    	
By Buckeye GP LLC, its   sole general partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Kevin J. Goodwin
    
	
 
    	
 
    	
Name: Kevin J. Goodwin
    
	
 
    	
 
    	
Title: Vice President   and Treasurer
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
SUNTRUST BANK,
    
	
 
    	
as the Administrative   Agent and as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Carmen Malizia
    
	
 
    	
 
    	
Name: Carmen Malizia
    
	
 
    	
 
    	
Title: Director
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
BARCLAYS BANK PLC
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Craig J. Malloy
    
	
 
    	
 
    	
Name: Craig J. Malloy
    
	
 
    	
 
    	
Title: Director
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
JPMORGAN CHASE BANK, N.A.
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Darren Vanek
    
	
 
    	
 
    	
Name: Darren Vanek
    
	
 
    	
 
    	
Title: Authorized   Signatory
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
WELLS FARGO BANK, N.A.
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Borden Tennant
    
	
 
    	
 
    	
Name: Borden Tennant
    
	
 
    	
 
    	
Title: Assistant Vice   President
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
DEUTSCHE BANK AG NEW YORK BRANCH
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Ming K. Chu
    
	
 
    	
 
    	
Name: Ming K. Chu
    
	
 
    	
 
    	
Title: Director
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Virginia Cosenza
    
	
 
    	
 
    	
Name: Virginia Cosenza
    
	
 
    	
 
    	
Title: Vice President
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
PNC BANK, NATIONAL ASSOCIATION
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Madeline L. Moran
    
	
 
    	
 
    	
Name: Madeline L. Moran
    
	
 
    	
 
    	
Title: Assistant Vice   President
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
ROYAL BANK OF CANADA
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Caleb Allen
    
	
 
    	
 
    	
Name: Caleb Allen
    
	
 
    	
 
    	
Title: Authorized   Signatory
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
SUMITOMO MITSUI BANKING   CORPORATION
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ James D. Weinstein
    
	
 
    	
 
    	
Name: James D.   Weinstein
    
	
 
    	
 
    	
Title: Managing   Director
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
BRANCH BANKING AND TRUST   COMPANY
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ DeVon J. Lang
    
	
 
    	
 
    	
Name: DeVon J. Lang
    
	
 
    	
 
    	
Title: Senior Vice   President
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

	
 
    	
BNP PARIBAS
    
	
 
    	
as a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Charles Hill
    
	
 
    	
 
    	
Name: Charles Hill
    
	
 
    	
 
    	
Title: Director
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
/s/ Reginald Crichlow
    
	
 
    	
 
    	
Name: Reginald Crichlow
    
	
 
    	
 
    	
Title: Vice President
    

 

SIGNATURE PAGE TO TERM LOAN AGREEMENT

 

 

SCHEDULE I

 

COMMITMENT AMOUNTS

 

	
Lender
    	
 
    	
Commitment Amount
    	
 
    
	
SunTrust Bank
    	
 
    	
$
    	
32,500,000.00
    	
 
    
	
Barclays Bank   PLC
    	
 
    	
$
    	
32,500,000.00
    	
 
    
	
JPMorgan Chase   Bank, N.A.
    	
 
    	
$
    	
32,500,000.00
    	
 
    
	
Wells Fargo   Bank, N.A.
    	
 
    	
$
    	
32,500,000.00
    	
 
    
	
Deutsche Bank   AG, New York Branch
    	
 
    	
$
    	
22,500,000.00
    	
 
    
	
PNC Bank NA
    	
 
    	
$
    	
22,500,000.00
    	
 
    
	
Royal Bank of   Canada
    	
 
    	
$
    	
22,500,000.00
    	
 
    
	
Sumitomo Mitsui   Banking Corporation
    	
 
    	
$
    	
22,500,000.00
    	
 
    
	
Branch   Banking & Trust Company
    	
 
    	
$
    	
15,000,000.00
    	
 
    
	
BNP Paribas S.A.
    	
 
    	
$
    	
15,000,000.00
    	
 
    
	
Total:
    	
 
    	
$
    	
250,000,000.00
    	
 
    

 

 

SCHEDULE 7.5

 

RESTRICTIVE AGREEMENTS

 

None.ex10-1.htm

EXECUTION VERSION

 

 

CREDIT AGREEMENT

 

dated as of

 

September 30, 2016

 

among

 

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY,

 

The Lenders Party Hereto,

 

JPMORGAN CHASE BANK, N.A.,

 

as Administrative Agent,

 

SUNTRUST BANK,

as Syndication Agent,

 

and

 

CITIBANK, N.A. and

ROYAL BANK OF CANADA,

as Co-Documentation Agents,

 

 

JPMORGAN CHASE BANK, N.A.,

as Joint Bookrunner and Joint Lead Arranger

 

SUNTRUST ROBINSON HUMPHREY, INC.,

as Joint Bookrunner and Joint Lead Arranger

 

 

  

 

  

Table of Contents

 

	  	
Page

	 	 
	
ARTICLE I  Definitions

	
1

	  	
SECTION 1.01.

	 	
Defined Terms

	
1

	  	
SECTION 1.02.

	 	
Classification of Loans and Borrowings

	
29

	  	
SECTION 1.03.

	 	
Terms Generally

	
30

	  	
SECTION 1.04.

	 	
Accounting Terms

	
30

	
ARTICLE II  The Credits

	
31

	  	
SECTION 2.01.

	 	
Commitments

	
31

	  	
SECTION 2.02.

	 	
Loans and Borrowings

	
31

	  	
SECTION 2.03.

	 	
Requests for Borrowings

	
32

	  	
SECTION 2.04.

	 	
Funding of Borrowings

	
33

	  	
SECTION 2.05.

	 	
Interest Elections

	
33

	  	
SECTION 2.06.

	 	
Termination and Reduction of Commitments; Increase of Commitments

	
34

	  	
SECTION 2.07.

	 	
Repayment of Loans; Evidence of Debt

	
36

	  	
SECTION 2.08.

	 	
Prepayment of Loans

	
37

	  	
SECTION 2.09.

	 	
Fees

	
38

	  	
SECTION 2.10.

	 	
Interest

	
38

	  	
SECTION 2.11.

	 	
Alternate Rate of Interest

	
39

	  	
SECTION 2.12.

	 	
Increased Costs

	
39

	  	
SECTION 2.13.

	 	
Break Funding Payments

	
41

	  	
SECTION 2.14.

	 	
Taxes

	
41

	  	
SECTION 2.15.

	 	
Payments Generally; Pro Rata Treatment; Sharing of Set-offs

	
45

	  	
SECTION 2.16.

	 	
Mitigation Obligations; Replacement of Lenders

	
46

	  	
SECTION 2.17.

	 	
Defaulting Lenders

	
47

	  	
SECTION 2.18.

	 	
Extension of Revolving Loans

	
48

	
ARTICLE III  Representations and Warranties

	
48

	  	
SECTION 3.01.

	 	
Organization; Powers

	
49

	  	
SECTION 3.02.

	 	
Authorization; Enforceability

	
49

	  	
SECTION 3.03.

	 	
Governmental Approvals; No Conflicts

	
49

	  	
SECTION 3.04.

	 	
Financial Statements; No Material Adverse Change

	
49

	  	
SECTION 3.05.

	 	
Insurance Licenses

	
50

	  	
SECTION 3.06.

	 	
Properties

	
50

  

 

  

 

	  	
SECTION 3.07.

	 	
Borrower’s Subsidiaries

	
50

	  	
SECTION 3.08.

	 	
Litigation

	
50

	  	
SECTION 3.09.

	 	
Compliance with Laws and Agreements

	
51

	  	
SECTION 3.10.

	 	
Investment Company Status

	
51

	  	
SECTION 3.11.

	 	
Taxes

	
51

	  	
SECTION 3.12.

	 	
[Reserved]

	
51

	  	
SECTION 3.13.

	 	
Environmental Matters

	
51

	  	
SECTION 3.14.

	 	
[Reserved]

	
52

	  	
SECTION 3.15.

	 	
[Reserved]

	
52

	  	
SECTION 3.16.

	 	
ERISA

	
52

	  	
SECTION 3.17.

	 	
Regulation U

	
52

	  	
SECTION 3.18.

	 	
Disclosure

	
52

	  	
SECTION 3.19.

	 	
[Reserved]

	
52

	  	
SECTION 3.20.

	 	
Anti-Corruption Laws and Sanctions

	
52

	  	
SECTION 3.21.

	 	
EEA Financial Institutions

	
52

	
ARTICLE IV  Conditions

	
53

	  	
SECTION 4.01.

	 	
Effective Date

	
53

	  	
SECTION 4.02.

	 	
Each Credit Event

	
54

	
ARTICLE V  Affirmative Covenants

	
55

	  	
SECTION 5.01.

	 	
Financial Statements; and Other Information

	
55

	  	
SECTION 5.02.

	 	
Notices of Material Events

	
57

	  	
SECTION 5.03.

	 	
Insurance Subsidiary Reporting

	
58

	  	
SECTION 5.04.

	 	
Existence; Conduct of Business

	
58

	  	
SECTION 5.05.

	 	
Payment of Taxes

	
59

	  	
SECTION 5.06.

	 	
Maintenance of Properties

	
59

	  	
SECTION 5.07.

	 	
Insurance

	
59

	  	
SECTION 5.08.

	 	
Proper Records; Rights to Inspect and Appraise

	
59

	  	
SECTION 5.09.

	 	
Compliance with Laws

	
59

	  	
SECTION 5.10.

	 	
Use of Proceeds

	
60

	  	
SECTION 5.11.

	 	
Licenses

	
60

	  	
SECTION 5.12.

	 	
Subsidiary Guarantees

	
60

	
ARTICLE VI  Negative Covenants

	
61

	  	
SECTION 6.01.

	 	
Debt; Certain Equity Securities

	
61

	  	
SECTION 6.02.

	 	
Liens

	
65

  

 

  

 

	  	
SECTION 6.03.

	 	
Fundamental Changes

	
68

	  	
SECTION 6.04.

	 	
[Reserved]

	
68

	  	
SECTION 6.05.

	 	
[Reserved]

	
71

	  	
SECTION 6.06.

	 	
Reinsurance

	
73

	  	
SECTION 6.07.

	 	
[Reserved]

	
73

	  	
SECTION 6.08.

	 	
Restricted Payments

	
73

	  	
SECTION 6.09.

	 	
Transactions with Affiliates

	
73

	  	
SECTION 6.10.

	 	
Restrictive Agreements

	
76

	  	
SECTION 6.11.

	 	
Maximum Ratio of Debt to Capital

	
78

	  	
SECTION 6.12.

	 	
Minimum Risk-Based Capital Ratio

	
78

	  	
SECTION 6.13.

	 	
[Reserved]

	
78

	  	
SECTION 6.14.

	 	
Minimum Statutory Surplus

	
78

	  	
SECTION 6.15.

	 	
[Reserved]

	
78

	  	
SECTION 6.16.

	 	
Lines of Business

	
79

	
ARTICLE VII  Events of Default

	
80

	
ARTICLE VIII  The Administrative Agent

	
83

	
ARTICLE IX  Miscellaneous

	
85

	  	
SECTION 9.01.

	 	
Notices

	
85

	  	
SECTION 9.02.

	 	
Waivers; Amendments

	
87

	  	
SECTION 9.03.

	 	
Expenses; Indemnity; Damage Waiver

	
88

	  	
SECTION 9.04.

	 	
Successors and Assigns

	
90

	  	
SECTION 9.05.

	 	
Survival

	
93

	  	
SECTION 9.06.

	 	
Counterparts; Integration; Effectiveness

	
93

	  	
SECTION 9.07.

	 	
Severability

	
94

	  	
SECTION 9.08.

	 	
Right of Setoff

	
94

	  	
SECTION 9.09.

	 	
GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS

	
94

	  	
SECTION 9.10.

	 	
WAIVER OF JURY TRIAL

	
95

	  	
SECTION 9.11.

	 	
Headings

	
95

	  	
SECTION 9.12.

	 	
Confidentiality

	
95

	  	
SECTION 9.13.

	 	
Interest Rate Limitation

	
97

	  	
SECTION 9.14.

	 	
USA PATRIOT Act

	
97

	  	
SECTION 9.15.

	 	
Acknowledgements

	
97

	 	
SECTION 9.16.

	 	Acknowledgement and Consent to Bail-In of EEA Financial Institutions	98

 

  

 

  

 

SCHEDULES:

 

Schedule 2.01 – Commitments

Schedule 3.07 – Borrower’s Subsidiaries

Schedule 6.01 -- Existing Debt

Schedule 6.02 -- Existing Liens

Schedule 6.06 -- Ceded Reinsurance

Schedule 6.10 -- Restrictive Agreements

 

EXHIBITS:

 

Exhibit A -- Form of Assignment and Assumption

Exhibit B -- Form of Borrowing Notice

Exhibit C-1 -- Form of Revolving Promissory Note

Exhibit C-2 -- Form of Term Promissory Note

Exhibit D -- Form of U.S. Tax Certificate

Exhibit E -- Form of Compliance Certificate

 

  

 

  

 

 

CREDIT AGREEMENT dated as of September 30, 2016, among AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY, the LENDERS party hereto, JPMORGAN CHASE BANK, N.A., as Administrative Agent, SUNTRUST BANK, as Syndication Agent and CITIBANK, N.A. and ROYAL BANK OF CANADA, as Co-Documentation Agents.

 

The parties hereto agree as follows:

 

ARTICLE I

 

Definitions

 

SECTION 1.01.     Defined Terms.  As used in this Agreement, the following terms have the meanings specified below:

 

“2013 Notes Debt” means Debt of $400,000,000 in aggregate principal amount outstanding issued under the 2013 Notes Documents.

 

“2013 Notes Documents” means the Indenture in respect of the 2013 Notes Debt dated as of April 22, 2004 by and between the Borrower and U.S. Bank National Association, as Trustee, as supplemented by the First Supplemental Indenture dated as of July 17, 2013 and the Second Supplemental Indenture dated as of July 17, 2013, the Borrower’s 6.625% Senior Notes Due 2021 issued thereunder (with Wells Fargo Bank, National Association acting as Trustee for the 2013 Notes Debt) and related agreements and other documents, as amended and supplemented from time to time pursuant to this Agreement.

 

“ABR”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.

 

“Adjusted Consolidated Debt” means, as of any date, Consolidated Debt (of the type described in any or all of clauses (a), (b), (c), (d), (g) and (h) of the definition of “Debt”, but, as to clause (h), only to the extent that it is an unpaid obligation in respect of a letter of credit or letter of guaranty that is then due and payable and not contingent) of the Borrower and its Subsidiaries, other than (i) Debt evidenced by Trust Preferred Securities Notes, but only to the extent that the aggregate unpaid principal balance of such Trust Preferred Securities Notes on such date does not exceed an amount equal to fifteen percent (15%) of Total Capitalization on such date (for the sake of clarity, with any portion of Debt evidenced by Trust Preferred Securities Notes that exceeds an amount equal to fifteen percent (15%) of Total Capitalization on such date being included in Debt for the purposes of this definition) and (ii) Subordinated Debt other than any Debt evidenced by Trust Preferred Securities Notes.

 

“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

 

  

 

  

 

“Adjusted Total Capitalization” means, as of any date, an amount equal to Total Capitalization, plus Accumulated Other Comprehensive Loss, or minus Accumulated Other Comprehensive Income (as those terms are used under GAAP), as applicable, to the extent, if any, reflected as a component of Consolidated Net Worth as of such date.

 

“Administrative Agent” means JPMorgan Chase Bank, N.A., in its capacity as administrative agent for the Lenders hereunder.

 

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

 

“Affiliate” means, with respect to a specified 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.

 

“Agent Parties” has the meaning specified in Section 9.01(f).

 

“Agreement” means this Credit Agreement, as amended, restated, modified or supplemented from time to time.

 

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on such day plus 1⁄2 of 1% and (c) the Adjusted LIBO Rate for deposits in Dollars for a one month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%; provided that, for the avoidance of doubt, the Adjusted LIBO Rate for any Business Day shall be based on the rate appearing on the Reuters Screen LIBOR01 Page (or on any successor or substitute page of such page) at approximately 11:00 a.m. London time on such day.  Any change in the Alternate Base Rate due to a change in the Prime Rate, the NYFRB Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the NYFRB or the Adjusted LIBO Rate, respectively.

 

“American Equity Life” means American Equity Investment Life Insurance Company, an Iowa insurance company.

 

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or its Subsidiaries from time to time concerning or relating to bribery or corruption.

 

“Applicable Insurance Code” means, as to any Insurance Subsidiary, the insurance code or other statute of any state where such Insurance Subsidiary is domiciled or doing insurance business and any successor statute of similar import, together with the regulations thereunder, as amended or otherwise modified and in effect from time to time.  References to sections of the Applicable Insurance Code shall be construed to also refer to successor sections.

 

“Applicable Insurance Regulatory Authority” means, when used with respect to any Insurance Subsidiary, the insurance department or similar administrative authority or agency located in the state in which such Insurance Subsidiary is domiciled.

 

  

 

  

 

“Applicable Percentage” means, with respect to any Lender, the percentage of the total Commitments represented by such Lender’s Commitment; provided that in the case of Section 2.17 when a Defaulting Lender shall exist, “Applicable Percentage” shall mean the percentage of the total Commitments (disregarding any Defaulting Lender’s Commitment) represented by such Lender’s Commitment.  If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments and to any Lender’s status as a Defaulting Lender at the time of determination.

 

“Applicable Rate” means, for any day, with respect to any ABR Loan or Eurodollar Loan, or with respect to the commitment fees payable hereunder, as the case may be, the applicable rate per annum set forth below under the caption “ABR Spread”, “Eurodollar Spread” or “Commitment Fee Rate”, as the case may be, based upon the S&P Rating applicable on such date to the Index Debt:

 

	
Index Debt Ratings:

	
ABR Spread

	
Eurodollar Spread

	
Commitment Fee Rate

	
Level I Status

	
0.625%

	
1.625%

	
0.225%

	
Level II Status

	
0.750%

	
1.750%

	
0.275%

	
Level III Status

	
1.000%

	
2.000%

	
0.325%

	
Level IV Status

	
1.250%

	
2.250%

	
0.425%

 

For the purposes of this definition:

 

“Level I Status” exists at any date if, on such date, the Borrower’s S&P Rating is BBB or better.

 

“Level II Status” exists at any date if, on such date, (i) the Borrower has not qualified for Level I Status and (ii) the Borrower’s S&P Rating is BBB- or better.

 

“Level III Status” exists at any date if, on such date, (i) the Borrower has not qualified for Level I Status or Level II Status and (ii) the Borrower’s S&P Rating is BB+ or better.

 

“Level IV Status” exists at any date if, on such date, the Borrower has not qualified for Level I Status, Level II Status, or Level III Status.

 

“S&P Rating” means, at any time, the rating issued by S&P and then in effect with respect to the Index Debt.

 

“Status” means Level I Status, Level II Status, Level III Status, or Level IV Status.

 

For purposes of the foregoing, (i) if S&P shall not have in effect a rating for the Index Debt (other than by reason of the circumstances referred to in the penultimate sentence of this definition), then S&P shall be deemed to have established a rating in Level IV, and (ii) if the ratings established or deemed to have been established by S&P for the Index Debt shall be changed (other than as a result of a change in the rating system of S&P), such change shall be effective as of the date on which it is first announced by S&P, irrespective of when notice of

 

  

 

  

 

such change shall have been furnished by the Borrower to the Administrative Agent and the Lenders pursuant to Section 5.02 or otherwise.  Each change in the Applicable Rate shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change.  If the rating system of S&P shall change, or if S&P shall cease to be in the business of rating corporate debt obligations, the Borrower and the Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from S&P and, pending the effectiveness of any such amendment, the Applicable Rate shall be determined by reference to the rating most recently in effect prior to such change or cessation.

 

“Approved Fund” has the meaning assigned to such term in Section 9.04.

 

“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 9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.

 

“Assumed Reinsurance” means reinsurance assumed by any Insurance Subsidiary from another Person (other than from another Insurance Subsidiary or Affiliate of the Borrower).

 

“Authorized Control Level Risk-Based Capital”, as of any date, has the meaning set forth on page 22, line 31, column 1 of the annual Statutory Statement most recently filed by American Equity Life and each other Insurance Subsidiary (or equivalent page, line, column or statement, to the extent that any thereof is modified or replaced).

 

“Availability Period” means the period from and including the Effective Date to but excluding the earlier of the Revolving Maturity Date and the date of termination of the Revolving Commitments.  For the avoidance of doubt, the Revolving Maturity Date of a Revolving Lender may be extended in accordance with Section 2.18.

 

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

 

“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

 

“Best” means A.M. Best Company, Inc. and its successors and assigns or, if it shall be dissolved or shall no longer assign ratings to insurance companies, then any other nationally recognized insurance statistical rating agency designated by the Administrative Agent.

 

“Blocked Person” has the meaning specified in Section 3.20.

 

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

 

  

 

  

 

“Borrower” means American Equity Investment Life Holding Company, an Iowa corporation.

 

“Borrowing” means Loans of the same Class and Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

 

“Borrowing Request” means a request by the Borrower for a Borrowing in accordance with Section 2.03.

 

“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, when used in connection with a Eurodollar Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.

 

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

 

“Capital Markets Transaction” means any issuance of debt securities by the Borrower or any of its Subsidiaries in a public offering or private placement or any incurrence of term loans by the Borrower or any of its Subsidiaries under syndicated credit facilities.

 

“Cash Equivalents” means any of the following: (a) any investment in direct obligations of the United States of America or any agency thereof; (b) investments in deposit accounts; (c) investments in demand deposits, overnight bank deposits, time deposits, eurodollar time deposits, certificates of deposit, money market deposits or bankers’ acceptances maturing within 365 days of the date of acquisition thereof issued by any Lender or a bank or trust company which is organized under the laws of the United States of America, any State thereof or any foreign country recognized by the United States of America, and which bank or trust company has capital, surplus and undivided profits aggregating in excess of $100,000,000 (or the foreign currency equivalent thereof) and (x) whose long-term debt is rated “A” (or such similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Exchange Act) or (y) the short term commercial paper of such bank or trust company or their respective parent companies is rated at the time of acquisition thereof at least “A-1” or the equivalent thereof by S&P or “P-1” or the equivalent thereof by Moody’s, or any money market fund sponsored by a registered broker dealer or mutual fund distributor; (d) repurchase obligations for underlying securities of the types described in clauses (a) through (c) above entered into with a Lender or a bank meeting the qualifications described in clause (c) above; (e) investments in commercial paper maturing not more than one year after the date of acquisition, issued by a corporation (other than an Affiliate of the Borrower) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the times as of which any investment

 

  

 

  

 

therein is made of “P-2” (or higher) by Moody’s or “A-2” (or higher) by S&P; (f) investments in securities with maturities of one year or less from the date of acquisition, issued or fully guaranteed by any state, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof; (g) marketable general obligations issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof maturing within one year from the date of acquisition and, at the time of acquisition, having a credit rating of “A” or better from S&P or A2 or better from Moody’s; (h)  instruments equivalent to those referred to in clauses (a) through (g) above denominated in euros or any foreign currency comparable in credit quality and tenor to those referred to in such clauses and customarily used by corporations for cash management purposes in any jurisdiction outside the United States to the extent reasonably required in connection with any business conducted by any Material Subsidiary organized in such jurisdiction; (i) securities with maturities of one year or less from the date of acquisition backed by standby letters of credit issued by any commercial bank satisfying the requirements of clause (c) of this definition; (j) interests in any investment company or money market fund that invests 95% or more of its assets in instruments of the type specified in clauses (a) through (i) of this definition and (k) money market funds that (i) comply with the criteria set forth in Rule 2A-7 of the Investment Borrower Act of 1940, as amended, (ii) are rated at the time of acquisition thereof “AAA” or the equivalent by a nationally recognized statistical rating organization and (iii) have portfolio assets of at least $5,000,000,000.

 

“CBOs” means notes or other instruments (other than CMOs) secured by collateral consisting primarily of debt securities and/or other types of debt obligations, including loans.

 

“Ceded Reinsurance” means risk that is ceded (whether by co-insurance, reinsurance or equivalent relationship otherwise named) by any Insurance Subsidiary to any other Person (other than to another Insurance Subsidiary or Affiliate of the Borrower), other than Surplus Relief Reinsurance.

 

“Change in Control” means the occurrence of any of the following:

 

(a)     at any time that any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that for the purposes of this clause (a) such person shall be deemed to have “beneficial ownership” of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of 35% or more of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests in the Borrower;

 

(b)     the occupation at any time of a majority of the seats (other than vacant seats) on the Board of Directors of the Borrower by Persons who were not (i) directors of the Borrower on the date of this Agreement or (ii) nominated or appointed by the Board of Directors of the Borrower;

 

(c)     the adoption or approval of a plan by the shareholders or directors of the Borrower for the liquidation or dissolution of the Borrower; or

 

  

 

  

 

(d)     the merger (other than a merger permitted under the provisions of Section 6.03) or consolidation of the Borrower with or into another Person or the merger of another Person with or into the Borrower, or the sale of all or substantially all the assets of the Borrower (determined on a Consolidated basis) to another Person, other than a merger or consolidation transaction in which holders of Equity Interests representing 100% of the ordinary voting power represented by the Equity Interests in the Borrower immediately prior to such transaction (or other securities into which such securities are converted as part of such merger or consolidation transaction) own directly or indirectly at least a majority of the ordinary voting power represented by the Equity Interests in the surviving Person in such merger or consolidation transaction issued and outstanding immediately after such transaction and in substantially the same proportion as before the transaction.

 

“Change in Law” means (a) the adoption of any law, rule, regulation or treaty after the date of this Agreement, (b) any change in any law, rule, regulation or treaty or in the interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) compliance by any Lender (or, for purposes of Section 2.12(b), by any lending office of such Lender or by such Lender’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement; provided, that notwithstanding anything herein to the contrary, (i) all requests, rules, guidelines, requirements and directives concerning capital adequacy or liquidity promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or by United States or foreign regulatory authorities, in each case pursuant to Basel III, and (ii) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives in connection therewith shall, in each case, be deemed to be a “Change in Law”, regardless of the date enacted, adopted, issued or implemented.

 

“Charges” has the meaning set forth in Section 9.13.

 

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

 

“CMOs” means notes or other instruments secured by collateral consisting primarily of mortgages, mortgage-backed securities and/or other types of mortgage-related obligations.

 

 “Code” means the Internal Revenue Code of 1986, as amended.

 

“Commitment” means, as to any Lender, the sum of the Term Commitment and the Revolving Commitment of such Lender.

 

“Communications” has the meaning specified in Section 9.01(f).

 

“Consolidated” means the Borrower and its Subsidiaries, taken as a whole in accordance with GAAP.

 

  

 

  

 

 

“Consolidated Assets” means, as at the date of any determination, the net book value of all assets of the Borrower and its Subsidiaries as of such date classified as assets in accordance with GAAP and determined on a Consolidated basis.

 

“Consolidated Liabilities” means, as at any date of determination, all liabilities of the Borrower and its Subsidiaries as of such date classified as liabilities in accordance with GAAP and determined on a Consolidated basis.

 

“Consolidated Net Worth” means, as at any date of determination, the remainder of (a) all Consolidated Assets (after deducting all applicable reserves and excluding any re-appraisal or write-up of assets after the date of this Agreement) as of such date, minus (b) all Consolidated Liabilities as of such date.

 

“Control” means possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

 

“Controlling” and “Controlled” have meanings correlative thereto.

 

“Credit Documents” means this Agreement and, after the execution and delivery thereof pursuant to the terms of this Agreement, each promissory note, if any, delivered pursuant to Section 2.07(f) and, after the execution and delivery thereof pursuant to the terms of this Agreement, each Subsidiary Guarantee and any certificate required to be delivered by the Borrower pursuant to Article II or Article V.

 

“Current Redeemable Equity” means any preferred stock or other Equity Interests, which in either case, is subject to mandatory redemption at any time prior to the first anniversary of the Latest Maturity Date (as it exists on any date of determination).

 

“Declining Lender” has the meaning specified in Section 2.18.

 

“Debt” of any Person means, without duplication:

 

(a)     all obligations of such Person for borrowed money,

 

(b)     all obligations of such Person evidenced by bonds, debentures, notes (with respect to the Borrower, including the Trust Preferred Securities Notes) or similar instruments,

 

(c)     all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person,

 

(d)     all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business),

 

(e)     all Debt of others secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Debt secured thereby has been assumed,

 

  

 

  

 

(f)     all Guarantees by such Person of Debt of others,

 

(g)     all Capital Lease Obligations of such Person,

 

(h)     all unpaid obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty (other than cash collateralized letters of credit to secure the performance of workers’ compensation, unemployment insurance, other social security laws or regulations, bids, trade contracts, leases, environmental and other statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case, obtained in the ordinary course of business),

 

(i)     Current Redeemable Equity,

 

(j)     all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, and

 

(k)     solely for purposes of Section 6.01 and the definition of “Material Debt”, obligations in respect of Hedging Agreements.

 

The Debt of any Person shall include the Debt of any other entity (including any partnership in which such Person is a general partner) to the extent that such Person is liable therefor pursuant to law or judicial holding as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent that contractual provisions binding on the holder of such Debt provide that such Person is not liable therefor; provided, that Debt shall not include (i) obligations with respect to insurance policies, annuities, guaranteed investment contracts and similar products underwritten by, or Reinsurance Agreements or Retrocession Agreements entered into by, an Insurance Subsidiary in the ordinary course of its business, (ii) obligations with respect to Surplus Relief Reinsurance ceded by an Insurance Subsidiary, (iii) obligations in the ordinary course of business of such Person to purchase securities that arise out of or in connection with the sale of the same or substantially similar securities or to return collateral consisting of securities arising out of or in connection with the loan of the same or substantially similar securities, (iv) [reserved], (v) unspent cash deposits or securities held in escrow by or in favor of such Person, or in a segregated deposit or securities account, as applicable, controlled by such Person, in each case in the ordinary course of business to secure the performance obligations of, or damages owing from, one or more third parties, (vi) any indebtedness under any overdraft or other cash management facilities so long as any such indebtedness is repaid in full no later than five Business Days following the date on which it was incurred or in the case of such indebtedness in respect of credit or purchase cards, within 60 days of its incurrence, (vi) except as provided in clause (g) above, any obligations in respect of a lease properly classified as an operating lease in accordance with GAAP, (vii) any liability for federal, state, local or other taxes not yet delinquent or being contested in good faith and for which adequate reserves have been established to the extent required by GAAP, (viii) any customer deposits or advance payments received in the ordinary course of business, and (ix) the following obligations issued or undertaken in connection with a Statutory Reserve Financing: (A) Surplus Notes or other obligations of any Special Purpose Subsidiary of the Borrower (“Reserve Financing Notes”), (B) any securities backed by such Reserve Financing Notes by an entity formed in connection with a Statutory Reserve Financing, (C) letters of credit issued for the

 

  

 

  

 

account of any Special Purpose Subsidiary of the Borrower, (D) reimbursement obligations of any Special Purpose Subsidiary, (E) any guarantees by the Borrower of the obligations described in (A), (B), (C) or (D) above, (F) reimbursement obligations of the Borrower or (G) capital maintenance or similar obligations of the Borrower in favor of any Special Purpose Subsidiary. The “principal amount” of the obligations of the Borrower or any Subsidiary in respect of any Hedging Agreement at any time will be the maximum aggregate amount (after giving effect to any netting agreements) that the Borrower or such Subsidiary would be required to pay if such Hedging Agreement were terminated at such time.

 

“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

 

“Defaulting Lender” means any Lender, as reasonably determined by the Administrative Agent, that has (a) failed to fund any portion of its Loans within three Business Days of the date such Loans were required to be funded by it hereunder, (b) notified the Borrower, the Administrative Agent or any Lender in writing that it does not intend to comply with any of its funding obligations under this Agreement or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement or under other agreements in which it commits to extend credit, (c) failed, within three Business Days after request by the Administrative Agent, to confirm in writing that it will comply with the terms of this Agreement relating to its obligations to fund prospective Loans (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent), (d) otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within three Business Days of the date when due, unless the subject of a good faith dispute, (e) or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity, or (iii) become the subject of a Bail-In Action; 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 so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.

 

“Dollars” or “$” refers to lawful money of the United States of America.

 

“Domestic Subsidiary” means any Subsidiary that is not a Foreign Subsidiary.

 

“EEA Financial Institution” means (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in

 

  

 

  

 

clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent;

 

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

“Effective Date” means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 9.02).

 

“Effective Date Trust Preferred Securities” means mandatorily redeemable preferred securities issued by any of the following Delaware business trusts that are Affiliates of the Borrower as of the Effective Date: American Equity Capital Trust II, American Equity Capital Trust III, American Equity Capital Trust IV, American Equity Capital Trust VII, American Equity Capital Trust VIII, American Equity Capital Trust IX, American Equity Capital Trust X, American Equity Capital Trust XI and American Equity Capital Trust XII.

 

“Electronic System” means any electronic system, including email, e-fax, Intralinks®, ClearPar® and any other Internet or extranet-based site, whether such electronic system is owned, operated or hosted by the Administrative Agent and any of its respective Related Persons or any other Person, providing for access to data protected by passcodes or other security system.

 

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

 

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary 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 Interests” means (a) shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person or (b) any Equity Rights in such Person; provided that any convertible securities issued by the Borrower shall be deemed not to be Equity Interests prior to their conversion to shares of common stock of the Borrower.

 

  

 

  

 

“Equity Rights” means, with respect to any Person, any subscriptions, options, warrants, commitments, preemptive rights or agreements of any kind (including any stockholders’ or voting trust agreements) for the issuance, sale, registration or voting of, or securities convertible into, any additional shares of capital stock of any class, or partnership or other ownership interests of any type in, such Person.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

 

“ERISA Affiliate” means (a) any entity, whether or not incorporated, that is under common control with the Borrower or its Subsidiaries within the meaning of Section 4001(a)(14) of ERISA; (b) any corporation which is a member of a controlled group of corporations within the meaning of Section 414(b) of the Code of which the Borrower or any of its Subsidiaries is a member; (c) any trade or business (whether or not incorporated) which is a member of a group of trades or businesses under common control within the meaning of Section 414(c) of the Code of which the Borrower or any of its Subsidiaries is a member; and (d) with respect to the Borrower or its Subsidiaries, any member of an affiliated service group within the meaning of Section 414(m) or (o) of the Code of which the Borrower or any of its Subsidiaries, any corporation described in clause (b) above or any trade or business described in clause (c) above is a member.

 

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (except an event for which the 30-day notice period is waived); (b) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (c) the incurrence by the Borrower or any ERISA Affiliate of any liability under Title IV of ERISA with respect to the termination of any Plan; (d) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (e) the adoption of any amendment to a Plan that would require the provision of security pursuant to Section 436(f)(i) of the Code; (f) the conditions exist for the imposition of a lien under Section 303(k) of ERISA; (g) a Plan is considered an “at risk” plan within the meaning of Section 430(i)(4) of the Code or Section 303 of ERISA; (h) the incurrence by the Borrower or any ERISA Affiliate of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; (i) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, in endangered status, critical status or insolvent, within the meaning of Title IV of ERISA or in endangered status or critical status within the meaning of Section 305 of ERISA; (j) the failure by the Borrower, its Subsidiaries or their ERISA Affiliates to make any required contribution to a Multiemployer Plan pursuant to Sections 431 or 432 of the Code; or (k) the withdrawal by the Borrower, its Subsidiaries or any of their respective ERISA Affiliates from any Plan with two or more contributing sponsors or the termination of any such Plan resulting in liability to the Borrower, its Subsidiaries or any of their respective Affiliates pursuant to Section 4063 or 4064 of ERISA.

 

  

 

  

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

 

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

 

“Event of Default” has the meaning assigned to such term in Article VII.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

 

“Excluded Subsidiary” means (a) any Foreign Subsidiary, (b) any Domestic Subsidiary, substantially all of the assets of which consist of Equity Interests in one or more Foreign Subsidiaries, (c) any Subsidiary which is not a Material Subsidiary, (d) any Insurance Subsidiary or any Subsidiary of an Insurance Subsidiary, and (e) any Subsidiary that is not permitted by law or regulation to guarantee the obligations of the Borrower under the Credit Documents or that would be required to obtain governmental (including regulatory) consent, approval, license or authorization to guarantee such obligations (unless such consent, approval, license or authorization has been received).

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Borrower under Section 2.16(b)) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.14, amounts with respect to such Taxes were payable either to such Lender's assignor immediately before such Lender acquired the applicable interest in a Loan or Commitment or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 2.14(f) and (d) any U.S. federal withholding Taxes imposed under FATCA.

 

“Extending Lender” has the meaning specified in Section 2.18.

 

“Facility” means each of (a) the Term Commitments and the Term Loans made thereunder (the “Term Facility”) and (b) the Revolving Commitments and the extensions of credit made thereunder (the “Revolving Facility”).

 

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official

 

  

 

  

 

interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

 

“Federal Funds Effective Rate” means, for any day, the rate calculated by the NYFRB based on such day’s federal funds transactions by depositary institutions (as determined in such manner as the NYFRB shall set forth on its public website from time to time) and published on the next succeeding Business Day by the NYFRB as the federal funds effective rate.

 

“Financial Officer” means the chief financial officer or vice president-controller of the Borrower.

 

“Fiscal Quarter” means a fiscal quarter of the Borrower.

 

“Fiscal Year” means a fiscal year of the Borrower.

 

“Foreign Subsidiary” means any Subsidiary that is incorporated or organized under the laws of any jurisdiction other than the United States of America, any State thereof or the District of Columbia.

 

“GAAP” means generally accepted accounting principles as in effect from time to time in the United States of America.

 

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

 

“Guarantee” by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Debt of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or to purchase (or advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Debt of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Debt or (d) otherwise to assure the owner of such Debt of payment thereof; provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.

 

“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 and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

  

 

  

 

“Hedging Agreement” means any interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement, option derivative agreement or index option derivative agreement or other interest rate, currency exchange rate, commodity price, or option hedging agreement or index option hedging arrangement.

 

“Impacted Interest Period” has the meaning specified in the definition of LIBO Rate.

 

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of the Borrower or any Subsidiary Guarantor (if any) under this Agreement or any other Credit Document, and (b) Other Taxes.

 

“Index Debt” means senior, unsecured, long-term debt of the Borrower without third-party credit enhancement.

 

“Ineligible Institution” means a (a) natural person, (b) a Defaulting Lender, (c) holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural person or (d) the Borrower or its Affiliates.

 

“Insurance Subsidiary” means a Subsidiary that is a regulated insurance company.  As of the date of this Agreement, American Equity Investment Life Insurance Company, American Equity Investment Life Insurance Company of New York and Eagle Life Insurance Company constitute the Insurance Subsidiaries.

 

“Interest Election Request” means a request by the Borrower to convert or continue a Revolving Borrowing in accordance with Section 2.05.

 

“Interest Payment Date” means (a) with respect to any ABR Loan, the last day of each March, June, September and December and (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurodollar Borrowing with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period.

 

“Interest Period” means with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months thereafter, as the Borrower may elect; provided, that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (ii) any Interest Period pertaining to a Eurodollar Borrowing that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.  For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

 

  

 

  

 

“Interpolated Rate” has the meaning specified in the definition of LIBO Rate.

 

“IRS” means the United States Internal Revenue Service.

 

“Latest Maturity Date” means, at any date of determination and with respect to the specified Loans or Commitments (or in the absence of any such specification, all outstanding Loans and Commitments hereunder), the latest Revolving Maturity Date or Term Maturity Date, as applicable, applicable to any such Loans or Commitments hereunder at such time, in each case as extended in accordance with this Agreement from time to time.

 

“Lead Arrangers” means each of JPMorgan Chase Bank, N.A. and SunTrust Robinson Humphrey, Inc. in its capacity as a joint lead arranger.

 

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Assignment and Assumption or pursuant to Section 2.06(d), other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.

 

“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, the London interbank offered rate as administered by ICE Benchmark Administration (or any other Person that takes over the administration of such rate) for Dollars for a period equal in length to such Interest Period as displayed on page LIBOR01 or LIBOR02 of the Reuters Screen that displays such rate (or, in the event such rate does not appear on a Reuters page or screen, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion; in each case, the “Screen Rate”) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period; provided that if the Screen Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement; provided further that, if the Screen Rate shall not be available at such time for such Interest Period (an “Impacted Interest Period”) with respect to Dollars, then the LIBO Rate shall be the Interpolated Rate at such time (provided that if the Interpolated Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement).  “Interpolated Rate” means, at any time, the rate per annum reasonably determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the Screen Rate for the longest period (for which that Screen Rate is available in Dollars) that is shorter than the Impacted Interest Period and (b) the Screen Rate for the shortest period (for which that Screen Rate is available for Dollars) that exceeds the Impacted Interest Period, in each case, at such time.

 

“License” has the meaning set forth in Section 3.05.

 

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) any option to sell such asset (excluding, for the

 

  

 

  

 

 

avoidance of doubt, any option issued in connection with securities held for investment) having the practical effect of any of the foregoing.

 

“Loan” means a Revolving Loan or a Term Loan, as applicable.

 

“Majority Facility Lenders” means with respect to any Facility, the Lenders who collectively hold more than 50% of the aggregate unpaid principal amount of the Term Loans or the Revolving Commitments, as the case may be, then outstanding under such Facility (or, in the case of the Revolving Facility, if the Revolving Commitments shall have been terminated, the Revolving Lenders who collectively hold more than 50% of the then outstanding principal amount of the Revolving Loans).  For purposes of calculating the "Majority Facility Lenders", the Term Loans, Revolving Commitments and Revolving Loans of any Defaulting Lender shall be deemed to be zero.

 

“Margin Stock” shall have the meaning provided in Regulation U.

 

“Material Adverse Effect” means a material adverse effect on (a) the business, properties, assets or financial condition of the Borrower and its Subsidiaries taken as a whole, (b) the ability of the Borrower to perform any of its payment obligations under any Credit Document or (c) the material rights of or remedies available to the Administrative Agent or any Lender under, or the validity or enforceability of, any Credit Document.

 

“Material Debt” means Debt (other than obligations in respect of the Loans) or obligations in respect of one or more Hedging Agreements, of any one or more of the Borrower and its Subsidiaries in an aggregate principal amount exceeding $30,000,000.

 

“Material Insurance Subsidiary” means a Material Subsidiary that is also an Insurance Subsidiary.  As of the date of this Agreement, American Equity Investment Life Insurance Company constitutes the only Material Insurance Subsidiary.

 

“Material Subsidiary” means a Subsidiary that holds, directly or indirectly, more than 5% of the Consolidated assets of the Borrower and its Subsidiaries at such time or that accounts for more than 5% of the Consolidated revenues of the Borrower and its Subsidiaries at such time, in each instance determined in accordance with GAAP.

 

“Maximum Rate” has the meaning set forth in Section 9.13.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

 

“NAIC” means the National Association of Insurance Commissioners and any successor thereto.

 

“NAIC Rules” means the rules and regulations of the NAIC.

 

  

 

  

 

“Net Available Proceeds” means, with respect to the sale or other disposition of any Equity Interests of the Borrower or a Material Subsidiary, the aggregate amount of all cash received by the Borrower and its Material Subsidiaries in respect of such sale or other disposition, net of reasonable expenses incurred by the Borrower and its Material Subsidiaries in connection therewith.

 

“Net Cash Proceeds” means, in connection with any Capital Markets Transaction, the cash proceeds received from such Capital Markets Transaction, net of attorneys’ fees, investment banking fees, accountants’ fees, underwriting discounts and commissions and other similar payments, and other customary fees, commissions, premiums and expenses actually incurred in connection therewith.

 

“New Lenders” has the meaning set forth in Section 2.18.

 

“Non-Guarantor Subsidiary” means any Subsidiary which is not a Subsidiary Guarantor.

 

“Non-U.S. Lender” means a Lender that is not a U.S. Person.

 

“NYFRB” means the Federal Reserve Bank of New York.

 

“NYFRB Rate” means, for any day, the greater of (a) the Federal Funds Effective Rate in effect on such day and (b) the Overnight Bank Funding Rate in effect on such day (or for any day that is not a Business Day, for the immediately preceding Business Day); provided that if none of such rates are published for any day that is a Business Day, the term “NYFRB Rate” means the rate for a federal funds transaction quoted at 11:00 a.m. on such day received by the Administrative Agent from a Federal funds broker of recognized standing selected by it; provided, further, that if any of the aforesaid rates shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Taxes (other than a connection arising from such Recipient having executed, delivered, enforced, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, or engaged in any other transaction pursuant to, or enforced this Agreement or any other Credit Document, or sold or assigned an interest in any Loan or Credit Document).

 

“Other Taxes” means any present or future stamp, court, documentary, intangible, recording, filing or similar excise or property Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, or from the registration, receipt or perfection of a security interest under, or otherwise with respect to, this Agreement or any other Credit Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment under Section 2.16(b)).

 

“Overnight Bank Funding Rate” means, for any day, the rate comprised of both overnight federal funds and overnight Eurodollar borrowings by U.S.-managed banking offices of depository institutions (as such composite rate shall be determined by the NYFRB as set forth

 

  

 

  

 

 

on its public website from time to time) and published on the next succeeding Business Day by the NYFRB as an overnight bank funding rate (from and after such date as the NYFRB shall commence to publish such composite rate).

 

“Participant” has the meaning assigned to such term in Section 9.04.

 

“Participant Register” has the meaning assigned to such term in Section 9.04(c).

 

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in Section 4002 of ERISA and any successor entity performing similar functions.

 

“Permitted Bond Hedge” means any net-settled call options or capped call options referencing the Borrower’s common stock purchased by the Borrower in connection with the issuance of convertible or exchangeable debt securities by the Borrower to hedge the Borrower’s obligations to deliver common stock under such Debt, which call options are either “capped” or are purchased concurrently with the sale by the Borrower of a call option or options in respect of its common stock, in either case on terms that are customary for “call spread” transactions entered in connection with the issuance of convertible or exchangeable debt securities.

 

“Permitted Liens” means with respect to any Person:

 

(a)     Liens imposed by law for taxes, assessments or other governmental charges that are not yet due or are being contested in compliance with Section 5.05;

 

(b)     Liens imposed by law and landlords’, carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens, arising in the ordinary course of business of such Person;

 

(c)     (i) pledges and deposits made by such Person in the ordinary course of business in compliance with workers’ compensation laws, unemployment, general insurance and other insurance laws and old age pensions and other social security, retirement benefits or similar laws or regulations (including deposits made in the ordinary course of business to cash collateralize letters of credit described in the parenthetical in clause (h) of the definition of “Debt”) and (ii) collateral consisting of Cash Equivalents securing letters of credit issued in respect of obligations to insurers in an aggregate amount not to exceed $10,000,000 at any time outstanding;

 

(d)     deposits to secure the performance of bids, tenders, contracts (other than for the payment of Debt) or leases to which such Person is a party, or deposits to secure public, regulatory or statutory obligations of such Person, surety and appeal bonds to which such Person is a party, performance bonds and other obligations of a like nature, and Liens imposed by statutory or common law relating to banker’s liens or rights of setoff or similar rights relating to deposit accounts, in each case in the ordinary course of business of such Person;

 

(e)     Liens arising under escrows, trusts, custodianships, separate accounts, funds withheld procedures, and similar deposits, arrangements, or agreements established with respect to insurance policies, annuities, guaranteed investment contracts and similar products

 

  

 

  

 

 

underwritten by, or Reinsurance Agreements entered into by, any Insurance Subsidiary in the ordinary course of business;

 

(f)     deposits with Applicable Insurance Regulatory Authorities in the ordinary course of business of such Person;

 

(g)     Liens on insurance policies and proceeds of insurance policies (including rebates of premiums) securing Debt of such Person incurred pursuant to Section 6.01(a)(xvi) to finance the payment of premiums on the insurance policies subject to such Liens;

 

(h)     minor survey exceptions, encumbrances, ground leases, easements, zoning restrictions, rights-of-way, licenses, reservations, minor irregularities of title, rights of others for licenses, rights of way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning, building codes or other restrictions and similar encumbrances on real property imposed by law or arising in the ordinary course of business of such Person that do not secure any monetary obligation and do not materially detract from the value of the affected property or materially interfere with the ordinary conduct of business of the Borrower or any Material Subsidiary;

 

(i)     purported  Liens evidenced by the filing of Uniform Commercial Code financing statement filings regarding operating leases entered into by the Borrower and the Material Subsidiaries in the ordinary course of business;

 

(j)     Liens securing Hedging Agreements relating to Debt so long as the related Debt is, and is permitted to be under this Agreement, secured by a Lien on the same property securing such Hedging Agreement;

 

(k)     banker’s liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a bank, depositary or other financial institution, whether arising by operation of law or pursuant to contract;

 

(l)     good faith deposits as security for contested taxes or contested import customs duties or for the payment of rent or other obligations of a like nature, in each case incurred in the ordinary course of business of such Person;

 

(m)     any interest or title of a lessor under any operating lease; and

 

(n)     Liens arising under escrows, trusts, custodianships, separate accounts, funds withheld procedures, and similar deposits, arrangements or agreements established with respect to insurance policies, annuities, guaranteed investment contracts and similar products underwritten by, or Reinsurance Agreements entered into by, any Insurance Subsidiary in the ordinary course of business;

 

provided that, except as provided in clause (c), above, the term “Permitted Liens” shall not include any Lien that secures Debt, or any obligation imposed pursuant to Section 430(k) of the Code or Sections 303(k) or 4068 of ERISA.

 

  

 

  

 

“Permitted Swap Obligations” means all obligations of the Borrower or any of its Subsidiaries existing or arising under Hedging Agreements; provided that such obligations are (or were) entered into by such Person in the ordinary course of business for the purpose of mitigating risks associated with liabilities, commitments or assets held by such Person, or changes in the value of securities issued by such Person in conjunction with a securities repurchase program not otherwise prohibited under this Agreement, and not for purposes of speculation or taking a “market view.”

 

“Permitted Transactions” means (a) mortgage-backed security transactions in which an investor sells mortgage collateral, such as securities issued by the Government National Mortgage Association and the Federal Home Loan Mortgage Corporation, for delivery in the current month while simultaneously contracting to repurchase “substantially the same” (as determined by the Public Securities Association and GAAP) collateral for a later settlement, (b) transactions in which an investor lends cash to a primary dealer and the primary dealer collateralizes the borrowing of the cash with certain securities, (c) transactions in which an investor lends securities to a primary dealer and the primary dealer collateralizes the borrowing of the securities with cash collateral, (d) transactions in which an investor makes loans of securities to a broker-dealer under an agreement requiring such loans to be continuously secured by cash collateral or United States government securities, (e) transactions structured as, and submitted to the NAIC Security Valuation Office for approval as, Replication (Synthetic Asset) Transactions (RSAT) (provided that, to the extent that such approval is not granted in respect of any such transaction, such transaction shall cease to constitute a Permitted Transaction 30 days following the date of such rejection, denial or non-approval), and (f) transactions in which a federal home loan mortgage bank (a “FHLMB”) makes loans to an Insurance Subsidiary that are sufficiently secured by appropriate assets of such Insurance Subsidiary consisting of government agency mortgage-backed securities in accordance with the rules, regulations and guidelines of such FHLMB for its loan programs.

 

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

 

“Plan” means any employee pension benefit plan (except a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and (i) in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) a “contributing sponsor” as defined in Section 400l(a)(13) of ERISA or (ii) which is or was at any time within the preceding five years, sponsored, maintained or contributed to by, or required to be contributed to by, the Borrower or any of its respective ERISA Affiliates or (iii) with respect to which the Borrower or any of its respective ERISA Affiliates has any actual or contingent liability.

 

“Prime Rate” means the rate of interest per annum publicly announced from time to time by JPMorgan Chase Bank, N.A. as its prime rate in effect at its office located at 270 Park Avenue, New York, New York; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.

 

  

 

  

 

 

“Public-Sider” means a Lender that has advised the Administrative Agent and the Borrower that it does not wish to receive material non-public information with respect to the Borrower or any of its Subsidiaries.

 

“Recipient” means, as applicable, (a) the Administrative Agent and (b) any Lender.

 

“Refinance” means, in respect of any Debt, to refinance, extend, renew, refund, replace, repay, prepay, purchase, redeem, defease or retire, or to issue other Indebtedness in exchange or replacement for or to consolidate, such Indebtedness. “Refinanced” and “Refinancing” shall have correlative meanings.

 

“Register” has the meaning assigned to such term in Section 9.04.

 

“Regulation U” means Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time.

 

“Reinsurance Agreement” means any agreement, contract, treaty or other arrangement providing for Ceded Reinsurance by any Insurance Subsidiary or any Subsidiary of such Insurance Subsidiary.

 

“Related Business” means any business that is the same as or related, ancillary or complementary to any of the businesses of the Borrower and the Material Subsidiaries on the Effective Date and any reasonable extension or evolution of any of the forgoing.

 

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

 

“Required Lenders” means, at any time, at least two Lenders who collectively hold more than 50% of the sum of (a) the then outstanding principal amount of the Term Loans and (b) the Revolving Commitments (or if the Revolving Commitments shall have been terminated, the then outstanding principal amount of the Revolving Loans).  For purposes of calculating the "Required Lenders", the Term Loans, Revolving Commitments and Revolving Loans of any Defaulting Lender shall be deemed to be zero.

 

“Responsible Officer” means any of the Chairman or Vice Chairman of the Board of Directors, the President, the Chief Financial Officer, the Chief Investment Officer, the Secretary or the Treasurer, in each case of the Borrower.

 

“Restricted Payment” means, without duplication, (a) any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interest in the Borrower or with respect to any Trust Preferred Securities or (b) any payment (whether in cash, securities or other property) or incurrence of an obligation by the Borrower or any of its Subsidiaries, including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Equity Interest in the Borrower or any Trust Preferred Securities.

 

  

 

  

 

“Retrocession Agreement” means any agreement, contract, treaty or other arrangement (other than Surplus Relief Reinsurance) whereby any Insurance Subsidiary or any Subsidiary of such Insurance Subsidiary cedes reinsurance to other insurers (other than to another Insurance Subsidiary or any of its Subsidiaries).

 

“Revolving Commitment” means, with respect to each Lender, the commitment of such Lender to make Revolving Loans hereunder, expressed as an amount representing the maximum aggregate amount of such Lender’s Revolving Loans, as such commitment may be (a) reduced or increased from time to time pursuant to Section 2.06 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04.  The initial amount of each Lender’s Revolving Commitment is set forth on Schedule 2.01, or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Revolving Commitment, as applicable. The initial aggregate amount of the Lenders’ Revolving Commitments is $150,000,000.

 

“Revolving Facility” has the meaning specified in the definition of Facility.

 

“Revolving Lender” means each Lender that has a Revolving Commitment or that holds Revolving Loans.

 

“Revolving Loan” means a Loan made by the Lenders to the Borrower pursuant to Section 2.01(a) hereof.

 

“Revolving Maturity Date” means September 30, 2021, as such date may be extended for any Lender pursuant to Section 2.18.

 

“Risk-Based Capital Ratio” means, as of the end of any Fiscal Quarter, the ratio of (a) Total Adjusted Capital as of such Fiscal Quarter-end to (b) an amount equal to (i) Authorized Control Level Risk-Based Capital (as prescribed or defined by the Applicable Insurance Regulatory Authority from time to time) as of such Fiscal Quarter-end, times (ii) two.

 

“Sanctioned Country” means, at any time, a country or territory which is the subject or target of any country-wide or territory-wide Sanctions (at the time of this Agreement, Crimea, Cuba, Iran, North Korea, Sudan and Syria).

 

“Sanctioned Person” means, at any time (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom, (b) any Person located, organized or resident in a Sanctioned Country or (c) any Person owned 50% or more or controlled by such Person or Persons described in the foregoing clauses (a) or (b).

 

“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State or (b) the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom.

 

  

 

  

 

 

“SAP” means, with respect to any Insurance Subsidiary, the accounting procedures and practices prescribed or permitted by the Applicable Insurance Regulatory Authority for the preparation of annual statements and other financial reports by insurance companies of the same type as such Person from time to time, subject to the provisions of Section 1.04.

 

“S&P” means Standard & Poor’s Financial Services LLC and its successors and assigns or, if it shall be dissolved or shall no longer assign credit ratings to long term debt, then any other nationally recognized statistical rating agency designated by the Administrative Agent.

 

“Screen Rate” has the meaning specified in the definition of LIBO Rate.

 

“SEC” means the United States Securities and Exchange Commission.

 

“Special Purpose Subsidiary” means any Material Subsidiary formed solely to issue Surplus Notes or other obligations in connection with a Statutory Reserve Financing or enter into Reinsurance Agreements in connection with a Statutory Reserve Financing or enter into ancillary obligations in respect of the foregoing.

 

“Statutory Reserve Financing” means a transaction or series of transactions entered into primarily for the purpose of financing a portion of the statutory reserves required to be held by an Insurance Subsidiary, where the proceeds or funding obligations provided by the financing counterparty or counterparties in such transaction or transactions are not expected, as of the date such transaction or transactions are entered into, to be used or applied to pay insurance or reinsurance claims reasonably projected to be payable as of the date such transaction or transactions are entered into.

 

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject, with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board).  Such reserve percentages shall include those imposed pursuant to such Regulation D.  Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation.  The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

 

“Statutory Statement” means, as to any Insurance Subsidiary, a statement of the condition and affairs of such Insurance Subsidiary, prepared in accordance with statutory accounting practices required or permitted by the Applicable Insurance Regulatory Authority and filed with the Applicable Insurance Regulatory Authority.

 

“Statutory Surplus” means, as at any date for any Insurance Subsidiary, the aggregate amount of surplus as regards policyholders (determined without duplication in accordance with SAP) of such Insurance Subsidiary, as set forth on page 3, line 38, of the most

 

  

 

  

 

recent Statutory Statement of such Insurance Subsidiary (or equivalent page, line, or statement, to the extent that any thereof is modified or replaced).

 

“Subordinated Debt” means the Debt of the Borrower evidenced by the Trust Preferred Securities Notes and any other Debt of the Borrower (a) no part of the principal of which is required to be paid (whether by way of mandatory sinking fund, mandatory redemption, mandatory prepayment or otherwise) prior to the date that is twelve months after the Latest Maturity Date (as it exists or any date of determination) and (b) that has been subordinated to the Loans and other obligations of the Borrower under the Credit Documents in right and time of payment upon terms that are satisfactory to the Required Lenders, which terms may, in the Required Lenders’ determination, include limitations or restrictions on the right of the holder of such Debt to receive payments and exercise remedies.

 

“subsidiary” means, with respect to any Person (the “parent”) at any date, (a) any corporation, limited liability company, partnership or other entity the accounts of which would be consolidated with those of the parent in the parent’s Consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date and (b) any other corporation, limited liability company, partnership or other entity of which securities or other ownership interests (A) representing more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership voting interests or (B) otherwise having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions, are, as of such date, owned, controlled or held as of such date by the parent and/or one or more of its subsidiaries, but excluding any such entity that is required to be consolidated under GAAP solely by reason of ASC 810.

 

“Subsidiary” means any subsidiary of the Borrower.

 

“Subsidiary Guarantee” means a written guarantee agreement in a form reasonably agreed by the Administrative Agent and the Borrower from a Subsidiary of the Borrower guaranteeing payment of the obligations of the Borrower under the Credit Documents.

 

“Subsidiary Guarantor” means any Subsidiary which executes and delivers a Subsidiary Guarantee.

 

“Surplus Note” means a promissory note executed by an Insurance Subsidiary of the type generally described in the insurance industry as a “surplus note,” the principal amount of which an insurance regulator permits the issuer to record as an addition to capital and surplus rather than as a liability in accordance with SAP.

 

“Surplus Relief Reinsurance” means any transaction in which any Insurance Subsidiary or any Subsidiary of such Insurance Subsidiary cedes risk relating to its annuity business under a reinsurance agreement that would be considered a “financing-type” reinsurance agreement as determined in accordance with GAAP.

 

“Swap Contract” means any agreement relating to any transaction (whether or not arising under a master agreement) that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond, note or bill option, interest rate option, futures contract, forward foreign exchange transaction, cap, collar or

 

  

 

  

 

floor transaction, currency swap, cross-currency rate swap, swaption, currency option, credit derivative transaction or any other similar transaction (including any option to enter into any of the foregoing) or any combination of the foregoing, and any master agreement relating to or governing any or all of the foregoing; provided that, for the avoidance of doubt, “Swap Contracts” shall not include any Permitted Bond Hedges.

 

“Tax Sharing Agreement” means the consolidated income tax agreement, dated April 11, 2011, among the Borrower and certain of its Subsidiaries as in effect on the Effective Date or as thereafter amended in any manner, that, taken as a whole, is not more disadvantageous to the Lenders in any material respect than any such agreement as it was in effect on the Effective Date, it being understood that, any amendment the purpose of which is to add Subsidiaries of the Borrower as parties to such agreement shall not be to be more disadvantageous to the Lenders solely by virtue of adding such Subsidiaries as parties.

 

“Taxes” means any 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.

 

“Term Commitment” means, with respect to each Lender, the commitment of such Lender to make Term Loans hereunder, expressed as an amount representing the maximum aggregate amount of such Lender’s Term Loans, as such commitment may be (a) reduced or increased from time to time pursuant to Section 2.06 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04.  The initial amount of each Lender’s Term Commitment is set forth on Schedule 2.01, or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Term Commitment, as applicable. The initial aggregate amount of the Lenders’ Term Commitments is $100,000,000.

 

“Term Facility” has the meaning specified in the definition of Facility.

 

“Term Lender” means each Lender that has a Term Commitment or that holds Term Loans.

 

“Term Loan” means a Loan made by the Lenders to the Borrower pursuant to Section 2.01(b) hereof.

 

“Term Maturity Date” means September 30, 2019.

 

“Total Adjusted Capital” as of any date, has the meaning set forth on page 22, line 30, column 1 of the annual Statutory Statement most recently filed by American Equity Life and each other Insurance Subsidiary (or, the equivalent page, line, column or statement, to the extent that any thereof is modified or replaced).

 

“Total Capitalization” means, as of any date, the aggregate of, without duplication, (a) Consolidated Debt of the Borrower, of the type described in any or all of clauses (a), (b), (c), (d), (g) and (h) of the definition of Debt (but with respect to clause (h), only to the extent that it is an unpaid obligation in respect of a letter of credit or letter of guaranty that is then due and payable and not contingent on such date), and (b) Consolidated Net Worth of the Borrower, on such date.

 

  

 

  

 

“Transactions” means the execution, delivery and performance by the Borrower of this Agreement and the other Credit Documents to which it is a party, the borrowing of Loans and the use of the proceeds thereof.

 

“Trust Preferred Securities” means mandatorily redeemable preferred securities issued by one or more Delaware business trusts that are Affiliates of the Borrower (including Effective Date Trust Preferred Securities), to which trusts the Borrower has issued Trust Preferred Securities Notes, provided, that no such preferred securities shall be mandatorily redeemable earlier than November 22, 2018.

 

“Trust Preferred Securities Notes” means (a) the unsecured junior subordinated deferrable interest notes issued by the Borrower to evidence loans made to the Borrower by the issuers of the Trust Preferred Securities from the proceeds of the sale of such Trust Preferred Securities under and pursuant to any of the Effective Date Trust Preferred Securities and (b) any subsequent unsecured junior subordinated deferrable interest notes issued by the Borrower to evidence loans made to the Borrower by the issuers of the Trust Preferred Securities from the proceeds of the sale of such Trust Preferred Securities, which notes are governed by indentures in all material respects equivalent (other than the face amount of such debentures) to that certain Junior Subordinated Indenture dated June 15, 2005 between the Borrower and JPMorgan Chase Bank, N.A., as trustee.

 

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

 

“U.S. Person” means a “United States” person within the meaning of Section 7701(a)(30) of the Code.

 

“U.S. Tax Certificate” has the meaning assigned to such term in Section 2.14(f)(ii)(D).

 

“USA Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56, as the same has been, or shall hereafter be, renewed, extended, amended or replaced.

 

“Wholly-Owned Subsidiary” means, with respect to any Person, any corporation, partnership or other entity of which all of the equity securities or other ownership interests (other than, in the case of a corporation, directors’ qualifying shares) are directly or indirectly owned or controlled by such Person or one or more Wholly-Owned Subsidiaries of such Person or by such Person and one or more Wholly-Owned Subsidiaries of such Person.

 

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

 

“Withholding Agent” means the Borrower, any Subsidiary Guarantor and the Administrative Agent and, in the case of any U.S. federal withholding Tax, any other withholding agent, if applicable.

 

  

 

  

 

"Write-Down and Conversion Powers" means, with respect to any EEA Resolution Authority, the write down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

SECTION 1.02.     Classification of Loans and Borrowings.  For purposes of this Agreement, Loans may be classified and referred to by Class (e.g., a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar Revolving Loan”). Borrowings also may be classified and referred to by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).

 

SECTION 1.03.     Terms Generally.  The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference to any statute or regulation shall be construed as including all statutory and regulatory provisions amending, replacing, supplementing or interpreting such statute or regulation, (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (f) 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.

 

SECTION 1.04.     Accounting Terms. All financial statements required to be delivered to the Administrative Agent hereunder shall be prepared in accordance with accounting principles or with statutory accounting practices applied on a basis consistent with those used in the preparation of the latest financial statements furnished to the Administrative Agent hereunder (except as otherwise disclosed in such financial statements) (which, prior to the delivery of the first financial statements under Section 5.01 hereof, shall mean the audited, or annual statutory, financial statements as at December 31, 2015 referred to in Section 3.04 hereof).  Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with, and all financial computations made pursuant to Sections 6.11, 6.12 and 6.14 shall be made pursuant to, GAAP, SAP or the NAIC Rules, as applicable, in each case as in effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provisions hereof to eliminate the effect of any change occurring after the date hereof in GAAP, SAP or the NAIC Rules, as applicable, or in the application thereof on the operation of such provisions (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provisions hereof

 

  

 

  

 

for such purpose), regardless of whether any such notice is given before or after such change in GAAP, SAP or the NAIC Rules, as applicable, or the application thereof, then such provisions shall be interpreted on the basis of GAAP, SAP or the NAIC Rules, as applicable, as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provisions amended in accordance herewith.  Notwithstanding the foregoing, all financial statements delivered hereunder shall be prepared, and all financial covenants contained herein shall be calculated, without giving effect to any election under accounting principles permitting a Person to value its financial liabilities or Debt at the fair value thereof.

 

Notwithstanding the foregoing provisions of this Section 1.04 all calculations, ratios and computations with respect to leases existing as of the date hereof and entered into from time to time hereafter may, at the option of the Borrower, continue to be calculated, classified and accounted for in conformity with GAAP as in effect as of the Effective Time; provided however, that the Borrower may elect, with notice to Administrative Agent, to treat operating leases as capital leases in accordance with GAAP as in effect from time to time and, upon such election, and upon any subsequent change to GAAP therefor, the parties will enter into negotiations in good faith in an effort to preserve the original intent of the financial covenants set forth herein.

 

ARTICLE II

 

The Credits

 

SECTION 2.01.     Commitments.

 

(a)     Revolving Loans.  Subject to the terms and conditions set forth herein, each Revolving Lender severally agrees to make Revolving Loans to the Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in (a) such Lender’s Revolving Loans exceeding such Lender’s Revolving Commitment or (b) the sum of the total Revolving Loans exceeding the total Revolving Commitments.  Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Revolving Loans.

 

(b)     Term Loans.  Subject to the terms and conditions set forth herein each Term Lender severally agrees to make an advance in Dollars to the Borrower on the Effective Date in a principal amount equal to its Term Commitment.  Amounts repaid or prepaid in respect of the Term Loans may not be reborrowed.

SECTION 2.02.     Loans and Borrowings.

 

(a)     Each Loan shall be made as part of a Borrowing consisting of Loans of the same Class and Type made by the Lenders ratably in accordance with their respective Commitments of the applicable Class.  The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.

 

  

 

  

 

(b)     Subject to Section 2.11, each Revolving Borrowing and Term Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request in accordance herewith.  Each Lender at its option may make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.

 

(c)     At the commencement of each Interest Period for any Eurodollar Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of $500,000 and not less than $2,500,000.  At the time that each ABR Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of $500,000 and not less than $2,500,000; provided that an ABR Revolving Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Revolving Commitments.  Borrowings of more than one Type may be outstanding at the same time; provided that there shall not at any time be more than a total of five Eurodollar Borrowings outstanding.

 

(d)     Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Revolving Maturity Date or Term Maturity Date, as applicable.

 

SECTION 2.03.     Requests for Borrowings.  To request a Borrowing, the Borrower shall notify the Administrative Agent of such request by telephone (a) in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three Business Days before the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 11:00 a.m., New York City time, one Business Day before the date of the proposed Borrowing.  Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Borrowing Request in a form approved by the Administrative Agent and signed by the Borrower.  Each such telephonic and written Borrowing Request shall be in the form of Exhibit B and shall specify the following information in compliance with Section 2.02:

 

(i)     whether the requested Borrowing is to be a Revolving Borrowing or a Term Borrowing;

 

(ii)     the aggregate amount of the requested Borrowing;

 

(iii)    the date of such Borrowing, which shall be a Business Day;

 

(iv)    whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;

 

(v)     in the case of a Eurodollar Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; and

 

(vi)    the location and number of the Borrower’s account to which funds are to be disbursed, which shall comply with the requirements of Section 2.04.

 

  

 

  

 

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an ABR Borrowing.  If no Interest Period is specified with respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

 

SECTION 2.04.     Funding of Borrowings.

 

(a)     Each Revolving Lender shall make each Revolving Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, New York City time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Revolving Lenders.  The Administrative Agent will make such Revolving Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account of the Borrower maintained with the Administrative Agent in New York City and designated by the Borrower in the applicable Borrowing Request.

 

(b)     Each Term Lender shall make the Term Loan to be made by it hereunder on the Effective Date by wire transfer of immediately available funds by 12:00 noon, New York City time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Term Lenders.  The Administrative Agent will make such Term Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account of the Borrower maintained with the Administrative Agent in New York City and designated by the Borrower in the applicable Borrowing Request.

 

(c)     Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) or (b), as applicable, of this Section 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 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 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 (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest rate applicable to ABR Loans.  If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing.

 

SECTION 2.05.     Interest Elections.

 

(a)     Each Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest Period as specified in such Borrowing Request.  Thereafter, the Borrower may elect to convert

 

  

 

  

 

such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section.  Subject to the requirements of Section 2.02(c), the Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.

 

(b)     To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Borrowing of the Type resulting from such election to be made on the effective date of such election.  Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery, telecopy or electronic transmission to the Administrative Agent of a written Interest Election Request in a form approved by the Administrative Agent and signed by the Borrower.

 

(c)     Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02:

 

(i)     the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

 

(ii)     the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

 

(iii)    whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and

 

(iv)    if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.

 

If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.

 

(d)     Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.

 

(e)     If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing.  Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative

 

  

 

  

 

Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.

 

SECTION 2.06.     Termination and Reduction of Commitments; Increase of Commitments.

 

(a)     Unless previously terminated, (i) the Term Commitments shall terminate when Term Loans pursuant thereto are made and (ii) the Revolving Commitments shall terminate on the Revolving Maturity Date.

 

(b)     The Borrower may at any time terminate, or from time to time reduce, the Revolving Commitments; provided that (i) each reduction of the Revolving Commitments shall be in an amount that is an integral multiple of $1,000,000 and not less than $5,000,000, and (ii) the Borrower shall not terminate or reduce the Revolving Commitments if, after giving effect to any concurrent prepayment of the Revolving Loans in accordance with Section 2.08(a), the sum of the Revolving Loans then outstanding would exceed the total Revolving Commitments.

 

(c)     The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Revolving Commitments under paragraph (b) of this Section at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof.  Promptly following receipt of any notice, the Administrative Agent shall advise the Revolving Lenders of the contents thereof.  Each notice delivered by the Borrower pursuant to this Section shall be irrevocable; provided that a notice of termination of the Revolving Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities or other events, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.  Subject to clause (d) below, any termination or reduction of the Commitments of any Class shall be permanent.  Each reduction of the Revolving Commitments shall be made ratably among the Revolving Lenders in accordance with their respective Revolving Commitments.

 

(d)     The Borrower may, from time to time, on up to three occasions, at its option, seek to increase the total Revolving Commitments by up to an aggregate amount of $50,000,000 (resulting in maximum total Revolving Commitments of $200,000,000) upon at least 30 days’ prior written notice to the Administrative Agent, which notice shall specify the amount of any such increase and shall be delivered at a time when no Default has occurred and is continuing.  After delivery of such notice, the Administrative Agent or the Borrower, in consultation with the Administrative Agent, may offer the increase (which may be declined by any Revolving Lender in its sole discretion) in the total Revolving Commitments on either a ratable basis to the Revolving Lenders or on a non-pro-rata basis to one or more Revolving Lenders and/or to other Revolving Lenders or entities reasonably acceptable to the Administrative Agent and the Borrower.  In addition to the foregoing, to the extent that the Borrower has elected to permanently reduce the Revolving Commitments, the Borrower may, from time to time, increase any portion of any Revolving Lender’s Revolving Commitment, with such Revolving Lender’s consent (or obtain the Revolving Commitments of other

 

  

 

  

Revolving Lenders or entities reasonably acceptable to the Borrower and the Administrative Agent), in an amount up to the amount by which the Revolving Commitments have been so reduced as long as the total Revolving Commitments shall not exceed $200,000,000 after giving effect to such increases.  Any increase in Revolving Commitments pursuant to this paragraph (d) shall require the consent of only the Borrower, the Administrative Agent and the Revolving Lenders or other entities providing such increase.  No increase in the total Revolving Commitments shall become effective until the existing or new Revolving Lenders extending such incremental Revolving Commitment amount and the Borrower shall have delivered to the Administrative Agent a document in form reasonably satisfactory to the Administrative Agent (which shall include the Borrower’s representation that the conditions set forth in Section 4.02 are then satisfied) pursuant to which any such existing Revolving Lender states the amount of its Revolving Commitment increase, any such new Revolving Lender states its Revolving Commitment amount and agrees to assume and accept the obligations and rights of a Revolving Lender hereunder and the Borrower accepts such incremental Revolving Commitments.  Upon the effectiveness of any increase in the total Revolving Commitments pursuant hereto, each Revolving Lender (new or existing) with an increased or new Revolving Commitment shall be deemed to have accepted an assignment from the existing Revolving Lenders, and the existing Revolving Lenders shall be deemed to have made an assignment to each new or existing Revolving Lender accepting a new or increased Revolving Commitment, of a ratable interest in each then outstanding Revolving Loan (in each case, on the terms and conditions set forth in the Assignment and Assumption or as directed by the Administrative Agent).  Assignments pursuant to the preceding sentence shall be made in exchange for, and substantially contemporaneously with the payment to the assigning Revolving Lenders of, the principal amount assigned plus accrued and unpaid interest and commitment fees, in each case, as directed by the Administrative Agent.  Payments received by assigning Revolving Lenders pursuant to this Section in respect of the principal amount of any Eurodollar Loan shall, for purposes of Section 2.13, be deemed prepayments of such Revolving Loan.  Any increase of the total Revolving Commitments pursuant to this Section shall be subject to receipt by the Administrative Agent from the Borrower of such supplemental opinions, resolutions, certificates and other documents as the Administrative Agent may reasonably request.

 

SECTION 2.07.     Repayment of Loans; Evidence of Debt.

 

(a)     The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of each Revolving Lender the then unpaid principal amount of each Revolving Loan on the Revolving Maturity Date.

 

(b)     The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of each Term Lender the then unpaid principal amount of each Term Loan on the Term Maturity Date.

 

(c)     Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.

 

  

 

  

 

(d)     The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Class and Type thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.

 

(e)     The entries made in the accounts maintained pursuant to paragraph (c) or (d) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.

 

(f)     Any Lender may request that Loans made by it be evidenced by a promissory note in the form of Exhibit C-1 or Exhibit C-2, as applicable, hereto.  In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender and its registered assigns.  Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form payable to the payee named therein and its registered assigns.

 

SECTION 2.08.     Prepayment of Loans.

 

(a)     Optional Prepayments.  The Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, upon notice to the Administrative Agent by telephone (confirmed by telecopy, electronic transmission or other writing approved by the Administrative Agent) of such prepayment (i) in the case of prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three Business Days before the date of prepayment or (ii) in the case of prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time, on the date of prepayment.  Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid; provided that a notice of prepayment delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities or other events, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied or event does not occur. Promptly following receipt of any such notice relating to a Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof.  Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case of an advance of a Borrowing of the same Type as provided in Section 2.02.  Each prepayment of a Revolving Borrowing shall be applied ratably to the Revolving Loans included in the prepaid Revolving Borrowing.  Prepayments shall be accompanied by accrued interest to the extent required by Section 2.10 and, if applicable, amounts owed pursuant to Section 2.13, if any.

 

(b)     Mandatory Prepayments.  If the Borrower or any of its Subsidiaries

 

  

 

  

 

consummates any Capital Markets Transaction which results in the receipt by the Borrower or any of its Subsidiaries of Net Cash Proceeds with respect thereto, the Borrower shall prepay (or cause to be prepaid) on such date Term Loans in an amount equal to the lesser of (i) the amount of such Net Cash Proceeds and (ii) the amount of Term Loans then outstanding.  The application of any prepayment pursuant to this Section 2.08(b) shall be made first, to ABR Loans and, second, to Eurodollar Loans.  Each prepayment of the Term Loans under this Section 2.08(b) (except in the case of ABR Loans) shall be accompanied by accrued  interest to the extent required by Section 2.10, if any, to the date of such prepayment on the amount prepaid.  If at any time the aggregate Revolving Loans of the Revolving Lenders exceeds the aggregate Revolving Commitments of the Revolving Lenders, the Borrower shall immediately prepay the Revolving Loans in the amount of such excess.

 

SECTION 2.09.     Fees.

 

(a)     The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender a commitment fee, which shall accrue at the Applicable Rate on the daily amount of the difference between the Revolving Commitment of such Revolving Lender and the outstanding principal balance of the Revolving Loans of such Revolving Lender during the period from and including the Effective Date to but excluding the date on which such Revolving Commitment terminates.  Accrued commitment fees shall be payable in arrears on the last day of March, June, September and December of each year and on the date on which the Revolving Commitments terminate, commencing on the first such date to occur after the date hereof.  All commitment fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

 

(b)     The Borrower agrees to pay to the Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreed upon between the Borrower and the Administrative Agent.

 

(c)     The Borrower agrees to pay to SunTrust Bank, for its own account, fees payable in the amounts and at the times separately agreed upon between the Borrower, SunTrust Robinson Humphrey, Inc. and SunTrust Bank.

 

(d)     All commitment fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution to the Revolving Lenders.  Fees paid shall not be refundable under any circumstances.

 

SECTION 2.10.     Interest.

 

(a)     The Loans comprising each ABR Borrowing shall bear interest at the Alternate Base Rate plus the Applicable Rate.

 

(b)     The Loans comprising each Eurodollar Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.

 

  

 

  

 

(c)     Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section or (ii) in the case of any other amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section.

 

(d)     Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and, in the case of Revolving Loans, upon termination of the Revolving Commitments; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving Loan prior to the end of the Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

 

(e)     All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  The applicable Alternate Base Rate or Adjusted LIBO Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.

 

SECTION 2.11.     Alternate Rate of Interest.  If prior to the commencement of any Interest Period for a Eurodollar Borrowing:

 

(a)     the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means (including by means of an Interpolated Rate) do not exist for ascertaining the Adjusted LIBO Rate for such Interest Period; or

 

(b)     the Administrative Agent is advised by the Majority Facility Lenders in respect of the relevant Facility that the Adjusted LIBO Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for such Interest Period;

 

then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion of any Borrowing under the relevant Facility to, or continuation of any Borrowing under the relevant Facility as, a Eurodollar Borrowing shall be ineffective and (ii) if any Borrowing Request requests a Eurodollar Borrowing under the relevant Facility, such Borrowing shall be made as an ABR Borrowing;

 

  

 

  

 

provided that if the circumstances giving rise to such notice affect only one Type of Borrowings, then the other Type of Borrowings shall be permitted.

 

SECTION 2.12.     Increased Costs.

 

(a)     If any Change in Law shall:

 

(i)     impose, modify or deem applicable any reserve, special deposit or similar requirement (including any compulsory loan requirement or insurance charge against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate);

 

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

 

(iii)     subject any Recipient to any Taxes (other than (A) Indemnified Taxes and (B) Excluded Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto;

 

and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or such other Recipient or to reduce the amount of any sum received or receivable by such Lender or such other Recipient hereunder (whether of principal, interest or otherwise), then the Borrower will from time to time, upon demand by such Lender, pay to the Administrative Agent for the account of such Lender or such other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender or other Recipient for such additional costs incurred or reduction suffered.

 

(b)     If any Lender determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement or the Loans made by such Lender, to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy and liquidity), then from time to time the Borrower will, upon demand by such Lender, pay to the Administrative Agent for the account of such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered; provided that such Lender shall only be entitled to seek such additional amounts under this paragraph (b) if such Lender is then generally seeking the payment of similar additional amounts from similarly situated borrowers in comparable credit facilities having comparable reimbursement provisions.

 

(c)     A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower along with the demand for payment referred to in paragraphs (a) and (b) above and shall be conclusive absent manifest error.  The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

 

  

 

  

 

(d)     Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

 

SECTION 2.13.     Break Funding Payments.  In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurodollar Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.08(a) and is revoked in accordance therewith) or (d) the assignment of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.16, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event (other than loss of the Applicable Rate for Eurodollar Loans).  In the case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the eurodollar market.  A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error.  The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

 

SECTION 2.14.     Taxes.

 

(a) Each payment by or on account of any obligation of the Borrower or any Subsidiary Guarantor (if any) under this Agreement or any other Credit Document shall be made without deduction or withholding for any Taxes, unless such withholding is required by any law.  If any Withholding Agent determines, in its sole discretion exercised in good faith, that it is so required to withhold Taxes, then such Withholding Agent may so withhold and shall timely pay the full amount of withheld Taxes to the relevant Governmental Authority in accordance with applicable law.  If such Taxes are Indemnified Taxes, then the amount payable by the Borrower or the applicable Subsidiary Guarantor shall be increased as necessary so that, net of such deduction or withholding (including such deduction or withholding applicable to additional amounts payable under this Section 2.14), the applicable Recipient receives the amount it would have received had no such deduction or withholding been made.

 

  

 

  

 

(b)     The Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law or at the option of the Administrative Agent timely reimburse it for, Other Taxes.

 

(c)     As soon as practicable after any payment of Taxes by the Borrower to a Governmental Authority pursuant to this Section 2.14, the applicable Withholding Agent shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

 

(d)     The Borrower indemnify each Recipient for any Indemnified Taxes that are paid or payable by such Recipient in connection with this Agreement or any other Credit Document (including amounts paid or payable under this Section 2.14(d)) and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  The indemnity under this Section 2.14(d) shall be paid within 10 days after the Recipient delivers to the Borrower a certificate stating the amount of any Indemnified Taxes so paid or payable by such Recipient and describing the basis for the indemnification claim.  Such certificate shall be conclusive of the amount so paid or payable absent manifest error.  Such Recipient shall deliver a copy of such certificate to the Administrative Agent.

 

(e)     Each Lender shall severally indemnify the Administrative Agent for any Taxes (but, in the case of any Indemnified Taxes, only to the extent that the Borrower has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Borrower to do so) attributable to such Lender that are paid or payable by the Administrative Agent in connection with this Agreement and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  The indemnity under this Section 2.14(e) shall be paid within 10 days after the Administrative Agent delivers to the applicable Lender a certificate stating the amount of Taxes so paid or payable by the Administrative Agent.  Such certificate shall be conclusive of the amount so paid or payable absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Credit Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).

 

(f)     Status of Lenders.

 

(i)     Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under this Agreement or any other Credit Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding.  In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other

 

  

 

  

 

documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to withholding (including backup withholding) or information reporting requirements.  Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.14(f)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender's reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

 

(ii)     Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Person,

 

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. Federal backup withholding tax;

 

(B) any Non-U.S. Lender shall, to the extent it is legally entitled to do so, 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 Non-U.S. Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:

 

	
  

	
(A)     in the case of a Non-U.S. Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN or W-8BEN-E (as applicable) establishing an exemption from, or reduction of, U.S. Federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or W-8BEN-E (as applicable) establishing an exemption from, or reduction of, U.S. Federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

 

	
  

	
(B)     executed originals of IRS Form W-8ECI;

 

	
  

	
(C)     in the case of a Non-U.S. Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit H-1 to the effect that such Non-U.S. Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10-percent shareholder” of the Borrower within the meaning of Section

 

  

 

  

 

 

881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN or W-8BEN-E (as applicable); or

 

	
  

	
(D)     to the extent a Non-U.S. Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit H-2 or Exhibit H-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Non-U.S. Lender is a partnership and one or more direct or indirect partners of such Non-U.S. Lender are claiming the portfolio interest exemption, such Non-U.S. Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit H-4 on behalf of each such direct and indirect partner;

 

(C) any Non-U.S. Lender shall, to the extent it is legally entitled to do so, 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 Non-U.S. Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

 

(D) if a payment made to a Lender under any Loan Document would be subject to U.S. Federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender's obligations under FATCA or to determine the amount to deduct and withhold from such payment.  Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

 

(g)     If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.14 (including additional amounts paid pursuant to this Section 2.14), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity

 

  

 

  

 

payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including any Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund).  Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid to such indemnified party pursuant to the previous sentence (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event such indemnified party is required to repay such refund to such Governmental Authority.  Notwithstanding anything to the contrary in this Section 2.14(g), in no event will any indemnified party be required to pay any amount to any indemnifying party pursuant to this Section 2.14(g) if such payment would place such indemnified party in a less favorable position (on a net after-Tax basis) than such indemnified party would have been in if the indemnification payments or additional amounts giving rise to such refund had never been paid.  This Section 2.14(g) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes which it deems confidential) to the indemnifying party or any other Person.

 

(h)     Each party’s obligations under this Section 2.14 shall survive any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all other obligations under this Agreement.

 

SECTION 2.15.     Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

 

(a)     The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest or fees, or of amounts payable under Section 2.12, 2.13 or 2.14, or otherwise) prior to 12:00 noon, New York City time, on the date when due, in immediately available funds, without set off or counterclaim.  Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made to the Administrative Agent at its offices at 270 Park Avenue, New York, New York, except that payments pursuant to Sections 2.12, 2.13, 2.14 and 9.03 shall be made directly to the Persons entitled thereto.  The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof.  If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.  All payments hereunder shall be made in Dollars.

 

(b)     If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal then due to such parties.

 

  

 

  

 

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

 

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

 

(e)     If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.04(c), 2.15(d) or 9.03(c), then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender’s obligations under such Sections until all such unsatisfied obligations are fully paid.

 

SECTION 2.16.     Mitigation Obligations; Replacement of Lenders.

 

(a)     If any Lender requests compensation under Section 2.12, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.14, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or

 

  

 

  

 

affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.12 or 2.14, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender.  The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

 

(b)     If (i) any Lender requests compensation under Section 2.12 hereof, (ii) the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.14 hereof, (iii) any Lender becomes a Defaulting Lender, (iv) any Lender shall fail to consent to a departure or waiver of any provision of the Credit Documents or fail to agree to any amendment thereto, which waiver, consent or amendment requires the consent of all Lenders or of all Lenders directly affected thereby and has been consented to by the Required Lenders or (v) any Lender becomes a Declining Lender in accordance with Section 2.18, 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 Section 9.04 hereof, with the Borrower obligated to pay any applicable processing and recordation fee), all its interests, rights and obligations under this Agreement 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 received the prior written consent of the Administrative Agent, which consent shall not unreasonably be withheld, (B) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, 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); provided however, that in the case of the Borrower’s replacement of a Defaulting Lender for failure to fund Loans hereunder, the assignee or the Borrower, as the case may be, shall hold back from such amounts payable to such Lender and pay directly to the Administrative Agent, any payments due to the Administrative Agent or the non-Defaulting Lenders by the Defaulting Lender under this Agreement, (C) in the case of any such assignment resulting from a claim for compensation under Section 2.12 hereof or payments required to be made pursuant to Section 2.14 hereof, such assignment will result in a reduction in such compensation or payments, and (D) in the case of clause (iv) above, the applicable Assignee shall have agreed to the applicable departure, waiver or amendment of the Credit Documents.  A Lender shall not be required to make any such assignment and 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.

 

SECTION 2.17.     Defaulting Lenders.  Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:

 

(a)     fees shall cease to accrue on the unfunded portion of the Revolving Commitment of such Defaulting Lender pursuant to Section 2.09(a); and

 

  

 

  

 

(b)     the Revolving Commitment, outstanding principal amount of Revolving Loans of such Defaulting Lender and the outstanding principal amount of Term Loans of such Defaulting Lender shall not be included in determining whether all Lenders, the Required Lenders or the Majority Facility Lenders have taken or may take any action hereunder (including any consent to any amendment or waiver pursuant to Section 9.02), provided that any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender which affects such Defaulting Lender differently than other affected Lenders shall require the consent of such Defaulting Lender, and provided further, that any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender made pursuant to clause (i), (ii) or (iii) of the first proviso to Section 9.02(b) (but, in respect of such clauses (ii) and (iii), only to the extent relating to principal or interest) shall also require the consent of any such Lender which has become a Defaulting Lender.

 

SECTION 2.18.     Extension of Revolving Loans.  The Borrower may request that the final maturity date of Revolving Commitments be extended for an additional one year period by providing notice (in consultation with the Administrative Agent) of such request and the due date for Revolving Lender responses to the Administrative Agent no later than 30 days prior to the then-existing Revolving Maturity Date or such fewer number of days as agreed by the Borrower and the Administrative Agent.  If a Revolving Lender agrees, in its individual and sole discretion, to extend its Revolving Commitment (an “Extending Lender”), it will notify the Administrative Agent in writing of its decision to do so no later than the due date for Revolving Lender responses specified by the Borrower in accordance with the prior sentence.  The Extending Lenders’ Revolving Commitments will be renewed for an additional one year from the then existing Revolving Maturity Date and such extended Revolving Maturity Date shall become the Revolving Maturity Date (except as otherwise provided in this Section 2.18 as to Declining Lenders); provided that (a) more than 50% of the total Revolving Commitments are extended or otherwise committed to by Extending Lenders and any new Revolving Lenders, (b) all representations and warranties made by the Borrower in or pursuant to the Credit Documents shall be true and correct in all material respects on and as of such date as if made on and as of such date, except any representations and warranties which are explicitly stated as having been made as of a specific date, which representations and warranties shall be true and correct in all material respects on and as of such date, and (c) no Default or Event of Default exists.  Any Revolving Lender that declines or does not respond to the Borrower’s request for commitment renewal (a “Declining Lender”) will have its Revolving Commitment terminated on the earlier of (A) the then existing Revolving Maturity Date (without regard to any renewals by other Revolving Lenders) and (B) the date such Declining Lender is replaced in accordance with Section 2.16, and at such time the Borrower shall repay all Revolving Loans and other amounts owing to such Declining Lender.  The Borrower will have the right to accept commitments from third party financial institutions subject to the consent of the Administrative Agent (such consent of the Administrative Agent not to be unreasonably withheld) (“New Lenders”) in an amount up to the amount of the Revolving Commitments of any Declining Lenders, provided that the Extending Lenders will have the right to increase their Revolving Commitments up to the amount of the Declining Lenders’ Revolving Commitments before the Borrower will be permitted to substitute any other financial institutions for the Declining Lenders.  The Borrower may only so extend the Revolving Maturity Date once.

 

  

 

  

 

ARTICLE III

 

Representations and Warranties

 

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

 

SECTION 3.01.     Organization; Powers.  The Borrower and each of its Material Subsidiaries is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and, except where failures to do so, in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.

 

SECTION 3.02.     Authorization; Enforceability.  The execution, delivery and performance of this Agreement by the Borrower are within its corporate powers and have been duly authorized by all necessary corporate action and, if required, stockholder or equity holder action.  This Agreement has been duly executed and delivered by the Borrower and constitutes, and each other Credit Document to which the Borrower is to be a party, when executed and delivered by the Borrower, will constitute, a legal, valid and binding obligation of the Borrower, as the case may be, in each case enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

 

SECTION 3.03.     Governmental Approvals; No Conflicts.  The execution, delivery and performance of this Agreement (a) do not require any material consent or approval of, registration or filing with, or other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, (b) will not violate the articles of incorporation, by-laws or other organizational documents of the Borrower or any order of any Governmental Authority, (c) will not violate any applicable law or regulation or result in a default under any indenture, agreement or other instrument binding upon the Borrower or any of its properties, or give rise to a right thereunder to require the Borrower to make any payment, where such violation, default or payment reasonably can be expected to have a Material Adverse Effect and (d) will not result in the creation or imposition of any Lien on any property of the Borrower.

 

SECTION 3.04.     Financial Statements; No Material Adverse Change.

 

(a)     The Borrower has heretofore furnished to the Lenders (i) the audited Consolidated balance sheet of the Borrower and its Subsidiaries as of December 31, 2015 and the related Consolidated statements of income and cash flows for the Fiscal Year then ended, reported on by KPMG LLP, independent public accountants, and (ii) the unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as of [June 30], 2016 and the related Consolidated statements of income and cash flows for the Fiscal Quarter then ended and for the portion of the Fiscal Year then ended, all certified by a Financial Officer of the Borrower.  Such financial statements present fairly, in all material respects, the Consolidated

 

  

 

  

 

 

financial position of the Borrower and its Subsidiaries as of such dates and its Consolidated results of operations and cash flows for such periods in accordance with GAAP, subject to the absence of footnotes and year-end audit adjustments in the case of the statements referred to in clause (ii) above.  None of the Borrower or any of its Material Subsidiaries has on the date hereof any material contingent liabilities, material liabilities for taxes, material unusual forward or long-term commitments or material unrealized or anticipated losses from any unfavorable commitments, except as referred to or reflected or provided for in said balance sheets as at said dates.

 

(b)     Since December 31, 2015, 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.

 

(c)     The Borrower has heretofore furnished to each of the Lenders the annual Statutory Statement of each Insurance Subsidiary for the fiscal year ended December 31, 2015, and the quarterly Statutory Statement of each Insurance Subsidiary for the partial year ended [June 30], 2016, in each case as filed with the Applicable Insurance Regulatory Authority.  All such Statutory Statements present fairly in all material respects the financial condition of each Insurance Subsidiary as at, and the results of operations for, the fiscal year ended December 31, 2015 and the partial year ended [June 30], 2016, in accordance with statutory accounting practices prescribed or permitted by the Applicable Insurance Regulatory Authority.

 

SECTION 3.05.     Insurance Licenses.  Schedule T to the most recent annual Statutory Statement of each Insurance Subsidiary lists, as of the Effective Date, all of the jurisdictions in which such Insurance Subsidiary holds active licenses (including licenses or certificates of authority from Applicable Insurance Regulatory Authorities), permits or authorizations to transact insurance and reinsurance business or to act as an insurance agent or broker (collectively, the “Licenses”). Each Insurance Subsidiary is in compliance in all material respects with each License held by it. No License (to the extent material) is the subject of a proceeding for suspension or revocation or any similar proceedings, there is no sustainable basis for such a suspension or revocation, and to the knowledge of the Borrower, no such suspension or revocation has been threatened by any Applicable Insurance Regulatory Authority except in any such case where such proceedings would not have a Material Adverse Effect.

 

SECTION 3.06.     Properties.

 

(a)     Each of the Borrower and its Subsidiaries has good title to, or valid leasehold interests in, all its real and personal property material to its business, except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes.

 

(b)     Each of the Borrower and its Subsidiaries owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and other intellectual property material to its business.

 

SECTION 3.07.     Borrower’s Subsidiaries.  As of the Effective Date, the Borrower has no Subsidiaries, other than those set forth on Schedule 3.07.  Schedule 3.07

 

  

 

  

 

accurately identifies the jurisdiction under the laws of which each such Subsidiary is formed and whether such Subsidiary is or is not, as the case may be, a Material Subsidiary as of the Effective Date.

 

SECTION 3.08.     Litigation.  There is no action, suit, arbitration proceeding or other proceeding, inquiry or investigation, at law or in equity, before or by any arbitrator or Governmental Authority pending against the Borrower or any Subsidiary or of which the Borrower or any Subsidiary has otherwise received notice or which, to the knowledge of the Borrower, is threatened against the Borrower or any Subsidiary (i) as to which, but after giving effect to any applicable insurance claim reserve, there is a reasonable possibility of an unfavorable decision, ruling or finding which would reasonably be expected to result in a Material Adverse Effect or (ii) that purports to affect or pertain to any of the Credit Documents or the transactions contemplated thereby.

 

SECTION 3.09.     Compliance with Laws and Agreements.  The Borrower is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property (including (i) all Environmental Laws, (ii) ERISA, (iii) applicable laws, regulations and orders dealing with intellectual property, and (iv) the Fair Labor Standards Act and other applicable law dealing with such matters) and all indentures, agreements and other instruments binding on it or its property, except where failures to do so, in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.  No Default has occurred and is continuing.

 

SECTION 3.10.     Investment Company Status.  Neither the Borrower nor any of its Subsidiaries is required to register under the provisions of the Investment Company Act of 1940, as amended.

 

SECTION 3.11.     Taxes.  The Borrower and its Subsidiaries are members of an affiliated group of corporations filing Consolidated returns for federal income tax purposes, of which the Borrower is the “common parent” (within the meaning of Section 1504 of the Code) of such group.  The Borrower and its Material Subsidiaries have filed all federal income tax returns and all other material tax returns that are required to be filed by them and have paid all taxes due and payable pursuant to such returns or pursuant to any assessment received by the Borrower or any of its Material Subsidiaries, except those taxes which are being contested in good faith by appropriate proceedings and for which adequate reserves have been established to the extent required by GAAP.  The charges, accruals and reserves on the books of the Borrower and its Material Subsidiaries in respect of taxes and other governmental charges are, in the opinion of the Borrower, adequate.  The Borrower has not given or been requested to give a waiver of the statute of limitations relating to the payment of any federal, state, local and foreign taxes or other impositions.

 

SECTION 3.12.     [Reserved].

 

SECTION 3.13.     Environmental Matters.  Each of the Borrower and its Subsidiaries has obtained all environmental, health and safety permits, licenses and other authorizations required under all Environmental Laws to carry on its business as now being or as proposed to be conducted, except to the extent failure to have any such permit, license or

 

  

 

  

 

authorization would not (either individually or in the aggregate) have a Material Adverse Effect.  Each of such permits, licenses and authorizations is in full force and effect and each of the Borrower and its Subsidiaries is in compliance with the terms and conditions thereof, and is also in compliance with all other limitations, restrictions, conditions, standards, prohibitions, requirements, obligations, schedules and timetables contained in any applicable Environmental Law or in any regulation, code, plan, order, decree, judgment, injunction, notice or demand letter issued, entered, promulgated or approved thereunder, except to the extent failure to comply therewith would not (either individually or in the aggregate) have a Material Adverse Effect.

 

SECTION 3.14.     [Reserved].

 

SECTION 3.15.     [Reserved].

 

SECTION 3.16.     ERISA.  Except as could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect: (a) no ERISA Event has occurred or is reasonably expected to occur; (b) no liability to the PBGC (other than required premium payments) under Title IV of ERISA has been or is expected to be incurred by the Borrower or any of its ERISA Affiliates; (c) the present value of all accumulated benefit obligations under each Plan, did not, as of the close of its most recent plan year, exceed the fair market value of the assets of such Plan allocable to such accrued benefits (determined in both cases using the applicable assumptions under Section 430 of the Code and the Treasury Regulations promulgated thereunder); and (d) the present value of all accumulated benefit obligations of all underfunded Plans did not, as of the close of the most recent plan year applicable to such Plans, exceed the fair market value of the assets of all such underfunded Plans (determined in both cases using the applicable assumptions under Section 430 of the Code and the Treasury Regulations promulgated thereunder).

 

SECTION 3.17.     Regulation U.  Neither the Borrower nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying Margin Stock.

 

SECTION 3.18.     Disclosure. All of the written reports, financial statements, certificates and other written information (other than projected financial information) that have been made available by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or any other Credit Document or delivered hereunder or thereunder, taken as a whole, as of the date furnished, are complete and correct in all material respects and do not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which such statements are made; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based on assumptions believed to be reasonable at the time.

 

SECTION 3.19.     [Reserved].

 

SECTION 3.20.     Anti-Corruption Laws and Sanctions.  The Borrower has implemented and maintains in effect policies and procedures reasonably designed to ensure

 

  

 

  

 

compliance in all material respects by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and the Borrower, its Subsidiaries and their respective directors, officers and employees and, to the knowledge of the Borrower, their respective agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects.  None of (a) the Borrower, any Subsidiary or any of their respective directors, officers or employees, or (b) to the knowledge of the Borrower, any agent of the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person.  No Borrowing, use of proceeds thereof or other transaction contemplated by this Agreement will violate Anti-Corruption Laws or applicable Sanctions.

 

SECTION 3.21.     EEA Financial Institutions.  Neither the Borrower, nor any Subsidiary Guarantor is an EEA Financial Institution.

ARTICLE IV

 

Conditions

 

SECTION 4.01.     Effective Date.  The obligations of the Lenders to make Loans hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.02):

 

(a)     The Administrative Agent (or its counsel) shall have received from each party hereto either (i) a counterpart of this Agreement signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement.

 

(b)     The Administrative Agent shall have received favorable written opinions (addressed to the Administrative Agent and the Lenders and dated the Effective Date) of each of (i) in-house counsel of the Borrower and (ii) Skadden Arps, Slate, Meagher & Flom LLP, special counsel for the Borrower, which opinions shall cover such matters relating to the Borrower, this Agreement, the other Credit Documents and the Transactions and otherwise shall be in such form and substance, as the Administrative Agent may reasonably request.  The Borrower hereby requests each such counsel to deliver such opinions.

 

(c)     The Administrative Agent shall have received such documents and certificates as the Administrative Agent or its counsel may reasonably request relating to the organization, existence and good standing of the Borrower, the authorization for and the validity of the Transactions and any other legal matters relating to the Borrower, this Agreement, the other Credit Documents or the Transactions, all in form and substance satisfactory to the Administrative Agent and its counsel.

 

(d)     The Administrative Agent shall have received a certificate, dated the Effective Date and signed by the President, a Vice President or a Financial Officer of

 

  

 

  

 

the Borrower, confirming compliance with the conditions set forth in paragraphs (a) and (b) of Section 4.02.

 

(e)     The Administrative Agent, the Lenders and the Lead Arrangers shall have received all fees and other amounts due and payable on or prior to the Effective Date, including, to the extent invoiced at least one Business Day prior to the Effective Date, reimbursement or payment of all out-of-pocket expenses (including fees, charges and disbursements of counsel) required to be reimbursed or paid by the Borrower under the Credit Documents.

 

(f)     All consents and approvals (including consents and approvals required for insurance and regulatory compliance) required to be obtained from any Governmental Authority or other Person in connection with the Transactions shall have been obtained and be in full force and effect, except where failure to obtain such approval or consent would not have a Material Adverse Effect.

 

(g)     The Administrative Agent and the Lenders shall have received from the Borrower such other certificates and other documents as the Administrative Agent or any Lender may reasonably have requested, including the promissory note complying with Section 2.07(f) of any Lender requesting such promissory note.

 

(h)     The Borrower shall have delivered to the Administrative Agent evidence reasonably satisfactory to the Administrative Agent that the Credit Agreement among the Borrower, various lender parties thereto, and JPMorgan Chase Bank, National Association, as administrative agent, dated as of November 22, 2013, as thereafter amended or supplemented, shall have been terminated and that all of the respective Debt and other obligations of the Borrower and its Subsidiaries thereunder shall have been paid and satisfied in full.

 

(i)     The Administrative Agent and the Lenders shall have received, at least three Business Days prior to the Effective Date, all documentation and other information about the Borrower required under applicable “know your customer” and anti-money laundering rules and regulations, including the PATRIOT Act, that has been reasonably requested by the Administrative Agent or any Lender in writing at least ten Business Days prior to the Effective Date.

 

The Administrative Agent shall notify the Borrower and the Lenders of the Effective Date, and such notice shall be conclusive and binding.  Notwithstanding the foregoing, the obligations of the Lenders to make Loans shall not become effective unless each of the foregoing conditions is satisfied (or waived pursuant to Section 9.02) at or prior to 3:00 p.m., New York City time, on October 31, 2016 (and, in the event such conditions are not so satisfied or waived, the Commitments shall terminate at such time).

 

SECTION 4.02.     Each Credit Event.  The obligation of each Lender to make a Loan on the occasion of any Borrowing is subject to the satisfaction of the following conditions:

 

  

 

  

 

(a)     The representations and warranties of the Borrower set forth in this Agreement and the other Credit Documents shall be true and correct in all material respects (without duplication of any materiality qualifier contained therein) on and as of the date of such Borrowing, except to the extent that such representation or warranty expressly relates to an earlier date (in which event such representations and warranties were true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier date).

 

(b)     At the time of and immediately after giving effect to such Borrowing, no Default shall have occurred and be continuing.

 

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

 

ARTICLE V

 

Affirmative Covenants

 

Until all the Commitments have expired or terminated and the principal of and interest on each Loan and all fees and other amounts payable hereunder have been paid in full (other than unmatured, surviving contingent obligations not yet due and payable), the Borrower covenants and agrees with the Lenders that:

 

SECTION 5.01.     Financial Statements; and Other Information.  The Borrower shall furnish to the Administrative Agent (for delivery to each Lender):

 

(a)     as soon as available and in any event within 100 days after the end of each Fiscal Year, its audited Consolidated balance sheet as of the end of such Fiscal Year and the related Consolidated statements of income and cash flows for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all reported on by KPMG LLP or other independent public accountants of recognized national standing (without qualification or exception (provided that a qualification or exception may be included in any such audit report for a period ending within the 12 month period preceding the scheduled Latest Maturity Date of this Agreement to the extent that such qualification or exception is solely the result of the obligations under this Agreement being reported as short term indebtedness) and without any qualification or exception as to the scope of such audit) as presenting fairly in all material respects the Consolidated financial condition, results of operations and cash flows of the Borrower and its Subsidiaries on a Consolidated basis in accordance with GAAP;

 

(b)     as soon as available and in any event within 50 days after the end of each of the first three Fiscal Quarters of each Fiscal Year, its Consolidated balance sheet as of the end of such Fiscal Quarter, the related Consolidated statements of income for such Fiscal Quarter and for the then elapsed portion of such Fiscal Year, and the related Consolidated statements of cash flows for the then elapsed portion of such Fiscal Year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous Fiscal Year, all certified by a Financial

 

  

 

  

 

Officer as presenting fairly in all material respects the financial condition, results of operations and cash flows of the Borrower and its Subsidiaries on a Consolidated basis in accordance with GAAP;

 

(c)     The Borrower hereby acknowledges that the Administrative Agent will make the financial statements to be provided under Section 5.01(a) and (b) above, along with this Agreement (excluding the schedules and exhibits attached hereto), available to Public-Siders;

 

(d)     concurrently with each delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer in the form of Exhibit E (i) certifying as to whether a Default has occurred and is continuing  as of the date of such certificate and, if such a Default has occurred and is continuing, specifying the details thereof and any action taken or proposed to be taken with respect thereto and (ii) setting forth reasonably detailed calculations demonstrating compliance with Sections 6.11, 6.12 and 6.14;

 

(e)     concurrently with each delivery of financial statements under clause (a) above, a certificate of a Financial Officer identifying any Subsidiary that has been formed or acquired during the Fiscal Year covered by such financial statements;

 

(f)     promptly after the same become publicly available, copies of all periodic and other material reports and proxy statements filed by the Borrower or any Material Subsidiary with the SEC, or any Governmental Authority succeeding to any or all of the functions of the SEC;

 

(g)     promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of the Borrower and its Subsidiaries, or compliance with the terms of any Credit Document, as the Administrative Agent or any Lender may reasonably request; and

 

(h)     promptly following receipt thereof, copies of any documents described in Sections 101(k) or 101(l) of ERISA that the Borrower, its Subsidiaries or their ERISA Affiliates may request with respect to any Multiemployer Plan or any documents described in Section 101(f) of ERISA provided to or received by any of the Borrower, its Subsidiaries or their ERISA Affiliates with respect to any Plan; provided, that if the Borrower, its Subsidiaries or their ERISA Affiliates have not requested such documents or notices from the administrator or sponsor of the applicable Multiemployer Plans, then, upon reasonable request of the Administrative Agent, the Borrower, its Subsidiaries or their ERISA Affiliates shall promptly make a request for such documents or notices from such administrator or sponsor and the Borrower shall provide copies of such documents and notices to the Administrative Agent promptly after receipt thereof;

 

provided, that any information or document that is required to be furnished by this Section 5.01 may be delivered electronically and, if so delivered, shall be deemed to be furnished on the earlier of (i) the date on which such documents have been posted on the Borrower's website or on the SEC's website or (ii) the date on which such documents are posted on the Borrower's behalf on an Electronic System to which each of the Administrative Agent and each Lender has access.

 

  

 

  

 

SECTION 5.02.     Notices of Material Events.  The Borrower shall furnish to the Administrative Agent prompt written notice of the following upon a Responsible Officer obtaining knowledge:

 

(a)     the occurrence of any Default;

 

(b)     the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority or Applicable Insurance Regulatory Authority against or affecting the Borrower or any Subsidiary that could reasonably be expected to result in a Material Adverse Effect, and any material development in respect of such legal or other proceedings, affecting the Borrower or any of its Subsidiaries, except any such legal or other proceedings that could not reasonably be expected to (either individually or in the aggregate) have a Material Adverse Effect;

 

(c)     (i) as soon as possible upon becoming aware of the occurrence of or forthcoming occurrence of any ERISA Event, a written notice specifying the nature thereof, what action the Borrower or any of its respective ERISA Affiliates has taken, is taking or proposes to take with respect thereto and, when known, any action taken or threatened by the IRS, the United States Department of Labor or the PBGC with respect thereto; and (ii) with reasonable promptness, upon the Administrative Agent’s request, copies of (1) each Schedule SB (Actuarial Information) to the annual report (Form 5500 Series) filed by the Borrower or any of their respective ERISA Affiliates with the IRS with respect to each Plan; (2) all notices received by the Borrower or any of its respective ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event; and three copies of such other documents or governmental reports or filings relating to any Plan as the Administrative Agent shall reasonably request;

 

(d)     the occurrence of any downgrade in the Borrower’s S&P Rating;

 

(e)     any actual or proposed change in any Applicable Insurance Code that could reasonably be expected to have a Material Adverse Effect; and

 

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

 

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

 

SECTION 5.03.     Insurance Subsidiary Reporting.  The Borrower shall furnish to the Administrative Agent copies of the following:

 

(a)     promptly after filing with the Applicable Insurance Regulatory Authority and in any event within 50 days after the end of each of the first three quarterly fiscal periods of each fiscal year of each Material Insurance Subsidiary, the quarterly Statutory Statement of such Material Insurance Subsidiary for such quarterly fiscal period, together with the opinion thereon of a senior financial officer of such Material Insurance Subsidiary stating that such Statutory Statement presents the financial condition of such Material Insurance Subsidiary for

 

  

 

  

 

such quarterly fiscal period in accordance with statutory accounting practices required or permitted by the Applicable Insurance Regulatory Authority;

 

(b)     promptly after filing with the Applicable Insurance Regulatory Authority and in any event within 100 days after the end of each fiscal year of each Material Insurance Subsidiary, the annual Statutory Statement of such Material Insurance Subsidiary for the recently completed fiscal year, together with (i) the opinion thereon of a senior financial officer of such Material Insurance Subsidiary stating that said annual Statutory Statement presents the financial condition of such Material Insurance Subsidiary for such fiscal year in accordance with statutory accounting practices required or permitted by the Applicable Insurance Regulatory Authority, and (ii) a copy of the “Statement of Actuarial Opinion” for such Material Insurance Subsidiary which is provided to the Applicable Insurance Regulatory Authority (or equivalent information should such Applicable Insurance Regulatory Authority no longer require such a statement), which statement shall be in the format prescribed by the Applicable Insurance Code of the state of domicile of such Material Insurance Subsidiary;

 

(c)     within 180 days after the end of each fiscal year of each Material Insurance Subsidiary, the report of KPMG LLP (or other independent certified public accountants of recognized national standing) on the annual Statutory Statements delivered pursuant to clause (b), above;

 

(d)     promptly after any Material Insurance Subsidiary receives the results of an examination of the financial condition and operations of such Insurance Subsidiary or any of its Material Subsidiaries by the insurance department of such Insurance Subsidiary’s state of domicile, a copy thereof;

 

(e)     promptly following the delivery or receipt by the Borrower or any of its Material Insurance Subsidiaries of any correspondence, written notice or report to or from any Applicable Insurance Regulatory Authority that relates, to any material extent, to the financial viability of any of its Material Subsidiaries, a copy thereof; and

 

(f)     within five Business Days after receipt, written notice from any Applicable Insurance Regulatory Authority of any threatened or actual proceeding for suspension or revocation of any material License of any Insurance Subsidiary or any similar proceeding with respect to any such material License.

 

SECTION 5.04.     Existence; Conduct of Business.  Except as otherwise permitted under Section 6.03, the Borrower shall, and shall cause each of its Material Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of its business, which if not so preserved, maintained or kept could reasonably be expected to result in a Material Adverse Effect; provided that the Borrower shall maintain its legal existence.

 

SECTION 5.05.     Payment of Taxes.  The Borrower shall, and shall cause each of its Material Subsidiaries to, pay all of its Tax liabilities, before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in

 

  

 

  

 

good faith by appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP, (c) such contest effectively suspends collection of the contested obligation and the enforcement of any Lien securing such obligation and (d) the failure to make payment pending such contest would not reasonably be expected to result in a Material Adverse Effect.

 

SECTION 5.06.     Maintenance of Properties.  The Borrower will, and will cause each of its Subsidiaries to, keep and maintain all tangible property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted.

 

SECTION 5.07.     Insurance.  The Borrower shall keep itself and all of its insurable properties, and shall cause each Material Subsidiary to keep itself and all of its insurable properties, insured at all times to such extent, by such insurers, and against such hazards and liabilities as is customarily carried by prudent businesses of like size and enterprise; and promptly upon the Administrative Agent’s written request upon and during the continuance of an Event of Default, the Borrower shall furnish to the Administrative Agent such information about any such insurance as the Administrative Agent may from time to time reasonably request; provided that, nothing in this Section 5.07 shall be deemed to require any of the Borrower’s Material Subsidiaries to enter into any Reinsurance Agreement and provided, further, that the Borrower and its Material Subsidiaries may self-insure against such hazards and risks, and in such amounts as is customary for corporations of a similar size and in similar lines of business.

 

SECTION 5.08.     Proper Records; Rights to Inspect.  The Borrower shall, and shall cause each of its Material Subsidiaries to, keep proper books of record and accounts to allow the Borrower and its Material Subsidiaries to prepare their financial statements in accordance with GAAP or statutory accounting practices required or permitted by the Applicable Insurance Regulatory Authority.  The Borrower shall, and shall cause each of its Material Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender, upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers, directors and employees, all at such reasonable times and as often as reasonably requested, but, other than in exigent circumstances, taking into account periodic accounting and regulatory compliance demands on the Borrower and its Subsidiaries.

 

SECTION 5.09.     Compliance with Laws.

 

(a)     The Borrower shall, and shall cause each of its Material Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority (including all Environmental Laws and ERISA and the respective rules and regulations thereunder) applicable to it or its property, other than such laws, rules or regulations (a) the validity or applicability of which the Borrower or any Subsidiary is contesting in good faith by appropriate proceedings or (b) the failure to comply with which could not reasonably be expected to result in a Material Adverse Effect.

 

(b)     Without limiting the generality of the foregoing, the Borrower and its Subsidiaries shall maintain in effect and enforce policies and procedures reasonably designed to ensure compliance in all material respects by the Borrower, its Subsidiaries and their

 

  

 

  

 

respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.

 

SECTION 5.10.     Use of Proceeds.  The proceeds of the Loans will be used only to finance the general corporate purposes of the Borrower and its Subsidiaries (including Refinancing existing Debt, repurchasing capital stock, making capital contributions to Subsidiaries and providing for the liquidity needs of the Borrower and its Subsidiaries).  No part of the proceeds of any Loan will be used, directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board, including Regulations T, U and X.  The Borrower will not request any Borrowing, and the Borrower shall not use, and shall procure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, or any Person in violation of any Anti-Corruption Laws, (b) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country in violation of applicable Sanctions, or (c) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

 

SECTION 5.11.     Licenses.  The Borrower shall, and shall cause each of its Insurance Subsidiaries to, do all things necessary to renew, extend and continue in effect all Licenses which may at any time and from time to time be necessary for any Insurance Subsidiary to operate its insurance business in compliance with all applicable laws and regulations except for any License the loss of which could not reasonably be expected to have a Material Adverse Effect; provided, that any Insurance Subsidiary may withdraw from one or more states (other than its state of domicile) as an admitted insurer if such withdrawal is determined by the Borrower’s Board of Directors to be in the best interest of the Borrower and could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 5.12.     Subsidiary Guarantees.  The Borrower will cause each Subsidiary (other than an Excluded Subsidiary) which guarantees any Debt of the Borrower or any Debt of any Subsidiary Guarantor in a principal amount in excess of $30,000,000 to concurrently execute and deliver to the Administrative Agent a Subsidiary Guarantee. The Borrower will, following a written request by the Borrower to the Administrative Agent stating the Borrower's intention to voluntarily add a Subsidiary Guarantor hereunder, cause each such Subsidiary to concurrently execute and deliver to the Administrative Agent a Subsidiary Guarantee.

 

ARTICLE VI

 

Negative Covenants

 

Until all the Commitments have expired or terminated and the principal of and interest on each Loan and all fees and other amounts payable hereunder have been paid in full (other than unmatured, surviving contingent obligations not yet due and payable), the Borrower covenants and agrees with the Lenders that:

 

  

 

  

 

SECTION 6.01.     Debt; Certain Equity Securities.

 

(a)     The Borrower shall not permit any of its Material Subsidiaries that is a Non-Guarantor Subsidiary to, create, incur, assume or permit to exist any Debt, except:

 

(i)      Debt created under the Credit Documents;

 

(ii)     Debt existing on the date hereof (as any of the same may be amended, modified, supplemented, or restated from time to time as long as the principal component is not increased (except by amounts of accrued interest, fees, premiums, penalties and expenses incurred in connection with any such amendment, supplement, restatement or modification)) and listed in Schedule 6.01, and any Refinancing thereof so long as the principal component is not increased thereby (except by amounts of accrued interest, fees, premiums, penalties and expenses incurred in connection with any such Refinancing);

 

(iii)     Debt of any Material Subsidiary owing to and held by the Borrower or any Subsidiary;

 

(iv)     Guarantees by (x) a Material Subsidiary of Debt of the Borrower, subject to Section 5.12; provided that if such Debt is by its express terms subordinated in right of payment to the obligations of the Borrower under the Credit Documents, any such guarantee of such Subsidiary Guarantor with respect to such Debt shall be subordinated in right of payment to such Subsidiary Guarantor’s Guarantee under the Subsidiary Guarantee substantially to the same extent as such Debt is subordinated to the obligations of the Borrower under the Credit Documents, as applicable, and (y) Material Subsidiaries of Debt incurred by other Subsidiaries not prohibited by the provisions of this Agreement; provided that the aggregate amount of Debt that may be Guaranteed by Material Subsidiaries in reliance on this Section 6.01(iv) shall not exceed $50,000,000 at any time outstanding;

 

(v)     [reserved];

 

(vi)     [reserved];

 

(vii)     Subordinated Debt;

 

(viii)     [reserved];

 

(ix)     Debt arising under agreements to maintain a specified net worth of any Insurance Subsidiary, as required by one or more Applicable Insurance Regulatory Authorities;

 

(x)     Debt (including Capital Lease Obligations, mortgage financings or purchase money obligations), incurred for the purpose of financing or reimbursing all or any part of the purchase price or cost of the acquisition, development, construction, purchase, lease, repair, addition or improvement of property (real or personal), plant, equipment or other fixed or capital assets, whether through the direct purchase of assets

 

  

 

  

 

or the purchase of Equity Interests of any Person owning such assets (in each case, incurred within 180 days of such acquisition, development, construction, purchase, lease, repair, addition or improvement) and all Debt incurred to Refinance any such Debt, in an aggregate principal amount which, when taken together with the principal amount of all other Debt incurred pursuant to this clause (x), will not exceed $10,000,000 at any one time outstanding;

 

(xi)       Debt incurred by a Material Subsidiary in respect of workers’ compensation claims, health, disability or other employee benefits or property, casualty or liability insurance, self-insurance obligations, performance, bid, surety, appeal and similar bonds and completion guarantees (not for borrowed money) or security deposits, letters of credit, banker’s guarantees or banker’s acceptances, in each case in the ordinary course of business (including letters of credit issued in connection with reinsurance transactions entered into in the ordinary course of business);

 

(xii)     Debt of Persons outstanding on the date on which such Person becomes a Material Subsidiary or is acquired by, or merged or consolidated with or into, a Material Subsidiary (other than Debt incurred in connection with, or in contemplation of, such acquisition, merger or consolidation); provided that after giving effect thereto, the Borrower would be in compliance with Section 6.11.

 

(xiii)     Debt under Hedging Agreements and Swap Contracts; provided, however, that such Hedging Agreements and Swap Contracts are entered into (i) in the ordinary course of business by any Insurance Subsidiary or (ii) to fix, manage or hedge interest rate or currency or commodity exposure of any Material Subsidiary and not for speculative purposes;

 

(xiv)     Debt arising from agreements of a Material Subsidiary providing for indemnification, adjustment of purchase price, earn-outs or similar obligations, in each case, incurred or assumed in connection with the acquisition or disposition of any business or assets of the Borrower or any business, assets or Equity Interests of a Subsidiary of the Borrower, other than Guarantees of Debt incurred by any Person acquiring all or any portion of such business, assets or Equity Interests for the purpose of financing such acquisition;

 

(xv)     Debt arising from the honoring by a bank or other financial institution of a check, draft or similar instrument, including, but not limited to, electronic transfers, wire transfers and commercial card payments drawn against insufficient funds in the ordinary course of business (except in the form of committed or uncommitted lines of credit);

 

(xvi)     Debt incurred by any Material Subsidiary in connection with third-party insurance premium financing arrangements in the ordinary course of business;

 

(xvii)     Debt owed to banks and other financial institutions incurred in the ordinary course of business of the Borrower and its Material Subsidiaries with such banks or financial institutions that arise in connection with ordinary banking arrangements to

 

  

 

  

 

provide treasury services or to manage cash balances of the Borrower and the Material Subsidiaries;

 

(xviii)      guarantees to suppliers or licensors (other than Guarantees of Debt) in the ordinary course of business;

 

(xix)     Debt in connection with (A) Permitted Transactions entered into by Insurance Subsidiaries, (B) investments made by Insurance Subsidiaries and permitted by the Applicable Insurance Regulatory Authority and (C) investments made by Insurance Subsidiaries and permitted by the investment policy approved by the Board of Directors of the applicable Insurance Subsidiary;

 

(xx)     [reserved];

 

(xxi)      Debt arising in connection with endorsement of instruments for deposit in the ordinary course of business;

 

(xxii)     non-recourse Debt of Insurance Subsidiaries incurred in the ordinary course of business (i) existing or arising under Hedging Agreements and Swap Contracts entered into by Insurance Subsidiaries or (ii) resulting from the sale or securitization of non-admitted assets, policy loans, CBOs and CMOs;

 

(xxiii)     Debt in respect of letters of credit in an amount not to exceed $10,000,000 at any one time outstanding; and

 

(xxiv)     additional Debt not to exceed $25,000,000 in aggregate principal amount at any time outstanding.

 

(b)     The Borrower shall not issue Current Redeemable Equity.

 

SECTION 6.02.     Liens.  The Borrower shall not, and shall not permit any of its Material Subsidiaries to, create or permit to exist any Lien on any property now owned or hereafter acquired by it, except:

 

(a)     Permitted Liens;

 

(b)     any Lien on any property of the Borrower or any Material Subsidiary existing on the date hereof and listed in Schedule 6.02; provided, that (A) such Lien shall not apply to any property other than the property subject thereto on the date hereof and (B) such Lien shall secure only those obligations which it secures on the date hereof and any Refinancing thereof that does not increase the principal component thereof (except by accrued interest, fees, premiums, penalties and expenses incurred in connection with any such Refinancing);

 

(c)     [reserved];

 

(d)      Liens on property, assets or shares of stock of a Person at the time such Person is acquired by, merged with or into or consolidated, combined or amalgamated with the

 

  

 

  

 

Borrower or any Material Subsidiary; provided, that such Liens were not incurred in connection with, or in contemplation of, such acquisition, merger, consolidation, combination or amalgamation; provided, further, that any such Lien may not extend to any other property owned by the Borrower or any Material Subsidiary;

 

(e)     Liens for the purpose of securing the payment of all or a part of the purchase price of, or Capital Lease Obligations, mortgage financings, purchase money Debt or other payments incurred to finance, assets or property (other than Equity Interests or other investments) acquired, constructed, improved or leased in the ordinary course of business; provided that, in the case of this clause (e):

 

(i)      the aggregate principal amount of Debt secured by such Liens does not exceed the cost of the assets or property so acquired, constructed or improved, plus reasonable fees and expenses of such Person incurred in connection therewith; and

 

(ii)      such Liens are created within 180 days of construction, acquisition or improvement of such assets or property and do not encumber any other assets or property of the Borrower or any Material Subsidiary other than such assets or property and assets affixed or appurtenant thereto and the proceeds thereof;

 

(f)     Liens securing Debt or other obligations of a Material Subsidiary owing to the Borrower;

 

(g)     Liens in favor of clearing agencies or securities trading exchanges in connection with option derivative transactions arising due to the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations promulgated thereunder;

 

(h)     Liens in favor of issuers of surety, appeal or performance bonds or letters of credit or bankers’ acceptances or similar obligations issued pursuant to the request of and for the account of such Person in the ordinary course of its business;

 

(i)      leases, licenses, subleases and sublicenses of assets (including real property and intellectual property rights) that do not materially interfere with the ordinary conduct of the business of the Borrower or any of its Material Subsidiaries;

 

(j)     Liens securing Hedging Obligations or Swap Contracts relating to Debt so long as the related Debt is not prohibited by this Agreement and is secured by a Lien on the same property securing such Hedging Obligation or Swap Contracts;

 

(k)       judgment Liens not giving rise to an Event of Default, and Liens securing appeal or surety bonds related to such judgment, so long as any appropriate legal proceedings that may have been duly initiated for the review of such judgment have not been finally terminated or the period within which such proceedings may be initiated has not expired;

 

(l)     Liens on specific items of inventory or other goods and proceeds of the Borrower or a Material Subsidiary securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;

 

  

 

  

 

(m)     Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with importation of goods;

 

(n)      Liens arising out of conditional sale, title retention, consignment or similar arrangements, or that are contractual rights of set-off, relating to the sale or purchase of goods entered into by the Borrower or any of the Material Subsidiaries in the ordinary course of business;

 

(o)     Liens on funds of the Borrower or any Subsidiary held in deposit accounts with third party providers of credit card processing, payment services securing credit card charge-back reimbursement and similar cash management obligations of the Borrower or its Subsidiaries;

 

(p)     Liens of a collecting bank arising in the ordinary course of business under Section 4-208 of the Uniform Commercial Code in effect in the relevant jurisdiction covering only the items being collected upon;

 

(q)     Liens arising by operation of law or contract on insurance policies and the proceeds thereof to secure premiums thereunder, including Liens on insurance policies and the proceeds of insurance policies securing Debt incurred by the Borrower or by any Material Subsidiary pursuant to Section 6.01(a)(xvi) to finance the payment of premiums on the insurance policies subject to such Liens;

 

(r)      customary Liens granted in favor of a trustee to secure fees and other amounts owing to such trustee under an indenture or other agreement pursuant to which Debt not prohibited by this Agreement is incurred;

 

(s)      Liens on any cash earnest money deposit made by the Borrower or any Material Subsidiary in connection with any letter of intent or acquisition agreement that is not prohibited by this Agreement;

 

(t)     Liens arising in connection with Cash Equivalents described in clause (d) of the definition of Cash Equivalents;

 

(u)     Liens in favor of credit card processors granted in the ordinary course of business;

 

(v)     Liens securing cash management obligations in the ordinary course of business;

 

(w)     Liens securing cash management obligations and other treasury service obligations (including obligations of the type described in Section 6.01(a)(xvii)) in an aggregate amount not to exceed $5,000,000 at any time outstanding and customary set-off rights in favor of depositary banks;

 

(x)     Liens encumbering reasonable customary initial deposits and margin deposits and similar Liens attaching to commodity trading accounts or other brokerage accounts incurred in the ordinary course of business and not for speculative purposes;

 

  

 

  

 

(y)      any encumbrance or restriction (including put and call arrangements) with respect to capital stock of any non-majority-owned joint venture or similar arrangement pursuant to any joint venture or similar arrangement;

 

(z)     collateral consisting of Cash Equivalents securing Permitted Swap Obligations in an aggregate amount not to exceed $10,000,000 at any time outstanding; provided that, for purposes of this clause (z), in the case of Cash Equivalents described in clauses (e), (f), (g) and (i) of the definition thereof, the one-year maturity limitations set forth in such clauses shall be disregarded;

 

(aa)     Liens on property of any Foreign Subsidiary securing Debt of such Foreign Subsidiary to the extent such Debt is permitted to be incurred pursuant to Section 6.01(a);

 

(bb)     Liens securing other obligations in an amount not to exceed $25,000,000 at any time outstanding;

 

(cc)     any Lien arising out of the Refinancing of any Debt secured by a Lien permitted by any of clause (d) or (e) of this Section; provided, that such Debt is not increased (except by the amount of fees, expenses, accrued interest, penalties and premiums required to be paid in connection with such Refinancing) and is not secured by any additional assets; and

 

(dd)     Liens on Margin Stock that is held by the Borrower as treasury stock.

 

SECTION 6.03.     Fundamental Changes.  The Borrower shall not, nor shall it permit any of its Material Subsidiaries to, enter into any transaction of merger or consolidation or amalgamation, liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution) or dispose of (in one transaction or in a series of related transactions) all or substantially all of the assets of the Borrower and its Subsidiaries, taken as a whole, except in connection with a disposition of a Material Subsidiary.

 

Notwithstanding the foregoing provisions of this Section 6.03,

 

(a)     any Subsidiary of the Borrower may be merged or consolidated with or into: (A) the Borrower if the Borrower shall be the continuing or surviving corporation or (B) any other Subsidiary; provided, that (i) if any such transaction shall be between a Subsidiary and a Wholly-Owned Subsidiary, the surviving Person shall be a Wholly-Owned Subsidiary and (ii) if any such transaction shall be between a Subsidiary which is not a Subsidiary Guarantor and a Subsidiary Guarantor, the surviving Person shall be a Subsidiary Guarantor;

 

(b)     the Borrower or any Subsidiary may merge or consolidate with any other Person so long as (A) the surviving corporation is the Borrower or, if the Borrower is not a party thereto, such Subsidiary, or the surviving Person becomes a Subsidiary, (B) no Default is in existence or would occur after giving effect to such merger, consolidation or acquisition, (C) the business activity engaged in by such other Person would be permitted under Section 6.03(d) hereof if such other Person were a Subsidiary of the Borrower prior to such merger, consolidation or acquisition and (D) after giving effect to such merger, consolidation or acquisition, the Borrower shall be in compliance on a pro forma basis with the financial

 

  

 

  

 

covenants set forth in Sections 6.11, 6.12 and 6.14 for the most recently ended Fiscal Quarter; and

 

(c)     any Subsidiary may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution would not reasonably be expected to result in a Material Adverse Effect.

 

The foregoing Section 6.03 shall not prohibit dispositions of Margin Stock that is held as treasury stock by the Borrower.

SECTION 6.04.     [Reserved].

 

SECTION 6.05.     [Reserved].

 

SECTION 6.06.     Reinsurance.  The Borrower shall not, nor shall it permit any Insurance Subsidiary to:

 

(a)     enter into any Reinsurance Agreement in excess of $10,000,000 with any Person other than (i) another Insurance Subsidiary, (ii) any Person for which the most recently published rating by Best is “B++” or higher or, if such Person is not rated by Best, which has a Statutory Surplus (or the equivalent thereof) of not less than $500,000,000, (iii) any Person that posts security under such Reinsurance Agreement in an amount equal to the total liabilities assumed by such Person, through a letter of credit issued by an “authorized bank” (as such term is defined by the Applicable Insurance Regulatory Authority) or a cash collateral deposit or a funds withheld trust as allowed by the Applicable Insurance Regulatory Authority or (iv) any other reinsurers acceptable to the Administrative Agent, provided however, that for purposes of the foregoing clause (ii), any “NA” designation shall not be considered a rating by Best;

 

(b)     enter into any Reinsurance Agreement or Reinsurance Agreements with Lloyd’s of London if the aggregate amount of reinsurance ceded thereby would exceed 15% of the aggregate premium volume of reinsurance ceded by the Insurance Subsidiaries;

 

(c)     enter into any Surplus Relief Reinsurance except with another Insurance Subsidiary; provided, that the Insurance Subsidiaries may, so long as in each case the requirements in clause (a) above are satisfied, (i) continue to maintain and from time to time amend, restate, extend or replace the Surplus Relief Reinsurance in effect on the date hereof and described on Schedule 6.06 and (ii) enter into new Surplus Relief Reinsurance arrangements so long as the aggregate amount of any increased amount arising from any amendments, restatements, extensions or replacements undertaken pursuant to clause (i), when added to the amount arising from any new arrangements, does not provide more than $75,000,000 in after-tax surplus relief benefit to the Insurance Subsidiaries; or

 

(d)     enter into any Reinsurance Agreement or Reinsurance Agreements if such Reinsurance Agreements will result in a 50% or more reduction of annuity deposits in the aggregate for all of the Insurance Subsidiaries, such amount to be calculated on a cumulative basis from January 1, 2016.

 

SECTION 6.07.     [Reserved].

 

  

 

  

 

SECTION 6.08.     Restricted Payments.  The Borrower shall not declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so unless, both immediately before and after giving effect to such Restricted Payment, no Default exists.

 

SECTION 6.09.     Transactions with Affiliates.  Except as expressly permitted by this Agreement, the Borrower shall not, nor shall it permit any of its Subsidiaries to, directly or indirectly: (a) make any investment in an Affiliate; (b) transfer, sell, lease, assign or otherwise dispose of any property to an Affiliate; (c) merge into or consolidate with or purchase or acquire property from an Affiliate; or (d) enter into any other transaction directly or indirectly with or for the benefit of an Affiliate (including Guarantees and assumptions of obligations of an Affiliate); provided, that:

 

(i)     any Affiliate who is an individual may serve as a director, officer or employee of the Borrower or any of its Subsidiaries and receive reasonable compensation, fees, insurance and indemnification for his or her services in such capacity,

 

(ii)     the Borrower and its Subsidiaries may enter into transactions (other than extensions of credit by the Borrower or any of its Subsidiaries to an Affiliate) providing for the leasing of property, the rendering or receipt of services or the purchase or sale of inventory and other property in the ordinary course of business if the monetary or business consideration arising therefrom would be substantially as advantageous to the Borrower and its Material Subsidiaries as the monetary or business consideration that would be obtained in a comparable transaction with a Person not an Affiliate (or in the case of any management agreement or investment advisory agreement among or between the Borrower and its Insurance Subsidiaries, that is approved by the Applicable Insurance Regulatory Authorities) as determined by the Borrower,

 

(iii)     the Borrower or any Subsidiary of the Borrower may enter into any transaction with any Subsidiary of the Borrower, and the Borrower or any of its Subsidiaries may enter into guarantees, Hedging Agreements and Swap Obligations, in each case for the benefit of the Borrower or a Subsidiary to the extent otherwise permitted by this Agreement,

 

(iv)     the Borrower and its Subsidiaries may enter into and perform the Tax Sharing Agreement,

 

(v)     the Borrower and its Subsidiaries may enter into transactions with Affiliates upon fair and reasonable terms no less favorable to the Borrower and its Subsidiaries than would be obtained in a comparable arm’s length transaction with a Person not an Affiliate of the Borrower or its Subsidiaries,

 

(vi)     the Borrower and its Subsidiaries may make any (i) Restricted Payment so long as the making of such Restricted Payment is not prohibited by Section 6.08 and (ii) investment in any Person that is an Affiliate of the Borrower solely as a result of the ownership of investments in such Person by the Borrower or any Subsidiary,

 

  

 

  

 

(vii)     the Borrower and its Subsidiaries may issue securities, or make other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment agreements and other compensation arrangements, options to purchase capital stock of the Borrower pursuant to restricted stock plans, long-term incentive plans, stock appreciation rights plans, participation plans or similar employee benefits plans, pension plans or similar plans or agreements or arrangements approved by the Board of Directors of the Borrower or the compensation committee thereof,

 

(viii)      the Borrower and its Subsidiaries may make loans or advances to, or guaranties of third party loans to, employees, officers or directors of the Borrower or any Subsidiary of the Borrower in the ordinary course of business, in an aggregate amount outstanding at any time not in excess of $2,000,000 (without giving effect to the forgiveness of any such loan),

 

(ix)     the Borrower and its Subsidiaries may pay reasonable and customary compensation (including fees, benefits, severance, change of control payments and incentive arrangements) to, and employee benefit arrangements, including split-dollar insurance policies, and indemnity or similar arrangements provided on behalf of, directors, officers, employees and agents of the Borrower or any of its Subsidiaries, whether by charter, bylaw, statutory or contractual provisions,

 

(x)      the Borrower and its Subsidiaries may permit to exist and perform the obligations of the Borrower or such Subsidiary under the terms of any agreement to which the Borrower or any Subsidiary is a party as of or on the Effective Date, as these agreements may be amended, modified, supplemented, extended or renewed from time to time; provided, however, that any future amendment, modification, supplement, extension or renewal entered into after the Effective Date will be permitted to the extent that its terms, taken as a whole, are not more disadvantageous to the Lenders in any material respect, as determined in good faith by the Borrower, than the terms of the agreements in effect on the Effective Date,

 

(xi)      the Borrower and its Subsidiaries may permit to exist  any agreement between any Person and an Affiliate of such Person existing at the time such Person is acquired by or merged with or into or consolidated with the Borrower or a Subsidiary, as these agreements may be amended, modified, supplemented, extended or renewed from time to time (so long as any such amendment is not disadvantageous in any material respect to the Lenders, as determined in good faith by the Borrower, when taken as a whole as compared to the applicable agreement as in effect on the date of such acquisition or merger) and provided that such agreement was not entered into in contemplation of such acquisition, merger or consolidation,

 

(xii)     this Section 6.09 shall not prohibit insurance transactions, intercompany pooling and other reinsurance transactions entered into in the ordinary course of business,

 

(xiii)     this Section 6.09 shall not prohibit any issuance or sale of capital stock (other than Current Redeemable Equity) to Affiliates of the Borrower and the granting of

 

  

 

  

 

registration and other customary rights in connection therewith or any contribution to the capital stock of the Borrower or any Subsidiary,

 

(xiv)      any transaction with an Affiliate where the only consideration paid by the Borrower or any Material Subsidiary is capital stock of the Borrower (other than Current Redeemable Equity),

 

(xv)      any transaction entered into by an Insurance Subsidiary for which approval has been received from the Applicable Insurance Regulatory Authority,

 

(xvi)     [reserved];

 

(xvii)     this Section 6.09 shall not prohibit any transaction with any Person who is not an Affiliate of the Borrower or of any Subsidiary immediately before the consummation of such transaction that becomes an Affiliate of the Borrower or of any Material Subsidiary as a result of such transaction, and

 

(xviii)  this Section 6.09 shall not prohibit any purchases by the Borrower’s Affiliates of Debt of the Borrower or any of the Subsidiaries, the majority of which Debt is placed with Persons who are not Affiliates, and payments of principal and interest on such Debt.

 

SECTION 6.10.     Restrictive Agreements.  The Borrower shall not and shall not permit any of its Material Subsidiaries to, directly or indirectly, enter into or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition on (a) the ability of any Material Subsidiary (i) to pay dividends or other distributions with respect to any shares of its capital stock or to make or repay loans or advances to the Borrower or any other Material Subsidiary or (ii) to sell, lease or transfer any of its property or assets to the Borrower or any Material Subsidiary, or (b) the ability of the Borrower or any Subsidiary to create or permit to exist any Lien on any of its property to secure obligations under the Credit Documents; provided, that the foregoing shall not apply to restrictions and conditions:

 

(i)     imposed by applicable law or any applicable rule, regulation, order, permit or grant, including, for the avoidance of doubt, any encumbrance or restriction on any Insurance Subsidiary by any governmental authority having the power to regulate such Insurance Subsidiary;

 

(ii)     imposed by any Credit Document;

 

(iii)     in agreements existing on the date hereof and identified on Schedule 6.10 and any Refinancing, amendment, restatement, modification, renewal or supplement, of any such agreement; provided that the restrictions and conditions contained in any such agreement (as so Refinanced, amended, restated, modified, renewed or supplemented) are no less favorable to the Administrative Agent and Lenders;

 

(iv)     contained in or arising under indentures or debt instruments or other debt arrangements incurred or preferred stock issued by the Borrower or any Material

 

  

 

  

 

Subsidiary subsequent to the Effective Date not in violation of Section 6.01; provided that such conditions and restrictions contained in any such indentures, instruments or arrangements will not materially adversely affect the Borrower’s ability to make anticipated principal or interest payments hereunder or are otherwise customary for financings or arrangements of that type (in each case, as determined in good faith by the Borrower);

 

(v)     (A) contained in or arising under indentures or other debt instruments or other debt arrangements incurred or preferred stock issued by the Borrower or any Material Subsidiary subsequent to the Effective Date pursuant to Section 6.01(a)(ii), (xii), (xiii) and (xviii), (B) with respect to Debt of the Borrower existing on the date hereof, contained in or arising under indentures or other debt instruments or other debt arrangements of the Borrower in effect on the date hereof and any amendments, modifications, supplements, restatements and Refinancings thereof, (C) with respect to Hedging Agreements or Swap Contracts of the Borrower or any Subsidiary Guarantor of the type described in Section 6.01(a)(xiii), contained in or arising under such Hedging Agreements or Swap Contracts or (D) contained or arising in connection with any Reinsurance Agreement or Statutory Reserve Financing or agreement entered into by an Insurance Subsidiary or Special Purpose Subsidiary;  provided  that such encumbrances and restrictions contained in any agreement or instrument will not materially adversely affect the Borrower’s ability to make anticipated principal or interest payments hereunder or are otherwise customary for financings or arrangements of that type (in each case, as determined in good faith by the Borrower);

 

(vi)     existing with respect to a Person or assets pursuant to an agreement in effect on or before the date on which such Person became a Material Subsidiary or was acquired by, merged into or consolidated with the Borrower or a Material Subsidiary (other than Equity Interests or Debt incurred as consideration in, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Person became a Material Subsidiary or was acquired by, merged into or consolidated with the Borrower or in contemplation of the transaction) or such assets were acquired by the Borrower or any Material Subsidiary;  provided that any such encumbrance or restriction shall not extend to any Person or the assets or property of the Borrower or any other Material Subsidiary other than the Person and its Subsidiaries or the assets and property so acquired and that, in the case of Debt, was permitted to be incurred pursuant to or not prohibited by this Agreement, and any Refinancing, amendment, restatement, modification, renewal, supplement, refunding or replacement of any such agreement; provided that the restrictions and conditions contained in any such agreement are no less favorable to the Administrative Agent and Lenders;

 

(vii)     contained in agreements relating to the sale of assets, including the sale of all Equity Interests or assets of a Subsidiary pending such sale; provided, that such restrictions and conditions apply only to the equity or assets to be sold and such sale is not prohibited hereunder;

 

  

 

  

 

 

(viii)     on cash or other deposits or net worth imposed by customers or lessors or required by insurance, surety or bonding companies under contracts entered into in the ordinary course of business;

 

(ix)     in the case of clauses (a)(ii) and (b), imposed by any agreement relating to secured obligations not prohibited by this Agreement if such restrictions or conditions apply only to the property securing such obligations;

 

(x)     in leases, subleases, licenses and other contracts entered into in the ordinary course of business;

 

(xi)     contained in any trading, netting, operating, construction, service, supply, purchase or other agreement to which the Borrower or any of the Material Subsidiaries is a party and entered into in the ordinary course of business;  provided that such agreement prohibits the encumbrance of solely the property or assets of the Borrower or such Material Subsidiary that are the subject of such agreement, the payment rights arising thereunder or the proceeds thereof and does not extend to any other asset or property of the Borrower or such Material Subsidiary or the assets or property of any other Material Subsidiary;

 

(xii)     contained in joint venture agreements and other similar agreements;

 

(xiii)     (A) existing by virtue of any transfer of, agreement to transfer, option or right with respect to, or Lien on, any property or assets of the Borrower or any Material Subsidiary not otherwise prohibited by this Agreement, (B) contained in mortgages, pledges or other security agreements securing Debt of a Material Subsidiary to the extent restricting the transfer of the property or assets subject thereto, (C) pursuant to customary provisions restricting dispositions of real property interests set forth in any reciprocal easement agreements of the Borrower or any Material Subsidiary, (D) pursuant to customary provisions in any swap or derivative transactions or (E) that arise or are agreed to in the ordinary course of business and do not detract from the value of property or assets of the Borrower or any Material Subsidiary in any manner material to the Borrower or such Material Subsidiary;

 

(xiv)     contained in or arising under any contract, instrument or agreement relating to Debt of any Foreign Subsidiary permitted to be incurred pursuant to Sections 6.01 and 6.02 that imposes restrictions solely on such Foreign Subsidiary and its Subsidiaries; and

 

(xv) which do not impair the Borrower’s or any Subsidiary’s ability to perform its obligations under this Agreement.

 

SECTION 6.11.     Maximum Ratio of Debt to Capital.  The Borrower shall not, as of the end of any Fiscal Quarter, permit the ratio of (a) its Adjusted Consolidated Debt as of such Fiscal Quarter-end to (b) its Adjusted Total Capitalization as of such Fiscal Quarter-end to be greater than 0.35 to 1.00.

 

  

 

  

 

SECTION 6.12.     Minimum Risk-Based Capital Ratio.  The Borrower shall cause American Equity Life and each other Material Insurance Subsidiary to maintain a Risk-Based Capital Ratio as of the end of any Fiscal Quarter of not less than 275%.

 

SECTION 6.13.     [Reserved].

 

SECTION 6.14.     Minimum Statutory Surplus.  At all times after the Effective Date, the Borrower shall cause American Equity Life to maintain a Statutory Surplus in an amount equal to the sum of (i) 80% of the Statutory Surplus of American Equity Life the last day of the Fiscal Quarter ended most recently prior to the Effective Date, plus (ii) 50% of the statutory net income (positive) of American Equity Life for each Fiscal Quarter ending after the Effective Date, plus (iii) 50% of all capital contributed to American Equity Life following the Fiscal Quarter-end immediately preceding the Effective Date.

 

SECTION 6.15.     [Reserved].

 

SECTION 6.16.     Lines of Business.  The Borrower shall not, nor shall it permit any of its Subsidiaries to, engage in any line or lines of business activity other than the business of owning and operating insurance companies and providing other financial services (including banking and investment advisory services) and businesses related, complementary or incidental thereto (it being understood that the businesses of American Equity Capital, Inc., AERL, L.C., American Equity Advisors, Inc. and American Equity Investment Properties, L.C., to the extent conducted as of the date hereof, are related to the business of owning and operating life insurance companies); provided that at least half of the Borrower’s Consolidated revenues, determined in accordance with GAAP, shall be derived from the business of owning and operating insurance companies (including insurance agencies).

 

ARTICLE VII

 

Events of Default

 

If any of the following events (“Events of Default”) shall occur:

 

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

 

(b)     the Borrower shall fail to pay when due any interest on any Loan or any fee or other amount (except an amount referred to in clause (a) above) payable under any Credit Document, and such failure shall continue unremedied for a period of five Business Days;

 

(c)     any material representation, warranty or certification made or deemed made by or on behalf of the Borrower or any Material Subsidiary in or in connection with any Credit Document or any amendment or modification thereof or waiver thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with any Credit Document or any amendment or

 

  

 

  

 

modification thereof or waiver thereunder, shall prove to have been incorrect in any material respect when made or deemed made;

 

(d)     the Borrower shall fail to observe or perform any covenant or agreement contained in Section 5.02(a), in Section 5.04 (as to maintenance of existence of the Borrower) or in Article VI;

 

(e)     the Borrower shall fail to observe or perform any provision of any Credit Document (other than those failures covered by clauses (a), (b), (c) and (d) of this Article VII) and such failure shall continue for 30 days after the delivery of notice of such failure to the Borrower from the Administrative Agent;

 

(f)     the Borrower or any of its Material Subsidiaries shall fail to make a payment or payments (whether of principal or interest and regardless of amount) in respect of any Material Debt when the same shall become due, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise unless such failure to make such payment is cured or waived;

 

(g)     the Borrower or any of its Material Subsidiaries shall default in the observance or performance of any material term of any Material Debt, if the effect of such default is to cause any Material Debt, or to permit the holder or holders of any Material Debt to cause such Material Debt, to become or declare due and payable prior to its stated maturity (with all notices provided for therein having been given and all grace periods provided for therein having lapsed, such that no further notice or passage of time is required in order for such holders to exercise such right, other than notice of their or its election to exercise such right), and only if such default has not been cured or waived;

 

(h)     an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any of its Material Subsidiaries or its debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any of its Material Subsidiaries or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;

 

(i)     the Borrower or any of its Material Subsidiaries shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) above, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any the Borrower or any of its Material Subsidiaries or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a

 

  

 

  

 

general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

 

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

 

(k)     one or more judgments for the payment of money, not covered by insurance, in an aggregate amount exceeding $40,000,000, after giving effect to any insurance, shall be rendered against the Borrower or any of its Material Subsidiaries and shall remain unpaid, unvacated or undischarged for a period of 60 consecutive days during which execution shall not be effectively stayed pending appeal or settlement thereof, or any action shall be legally taken by a judgment creditor to attach or levy upon any asset of the Borrower or any of its Subsidiaries to enforce any such judgment;

 

(l)     an ERISA Event shall have occurred that, when taken together with all other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect;

 

(m)     any Subsidiary Guarantee of a Material Subsidiary (or a group of Subsidiaries when taken together (as of the date of the latest audited consolidated financial statements for the Borrower and its consolidated Subsidiaries) would constitute a Material Subsidiary) ceases to be in full force and effect (except as contemplated by the terms of this Agreement and the Subsidiary Guarantees) or is declared null and void in a judicial proceeding or any Subsidiary Guarantor that is a Material Subsidiary denies or disaffirms its obligations under its Subsidiary Guarantee, and the Borrower fails to cause such Subsidiary Guarantor or Subsidiary Guarantors, as the case may be, to rescind such denial or disaffirmation within 30 days after the Borrower obtaining actual knowledge thereof;

 

(n)     a Change in Control shall occur; or

 

(o)     any material provision of any Credit Document after delivery thereof shall for any reason cease to be valid and binding on or enforceable against the Borrower, or the Borrower shall so state in writing;

 

then, and in every such event (except an event with respect to the Borrower described in clause (h) or (i) above), and at any time thereafter during the continuance of such event, the Administrative Agent may with the consent of the Required Lenders, and at the request of the Required Lenders shall, by notice to the Borrower, take either or both of the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, and (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are waived by the Borrower; and in the case of any event with respect to the Borrower described in clause (h) or (i)

 

  

 

  

 

above, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are waived by the Borrower.

 

ARTICLE VIII

 

The Administrative Agent

 

Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent 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, together with such actions and powers as are reasonably incidental thereto.

 

The bank 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 such bank and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if it were not the Administrative Agent hereunder.

 

The Administrative Agent shall not have any duties or obligations except those expressly set forth herein.  Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby that the Administrative Agent is required to exercise in writing as directed by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02), and (c) except as expressly set forth herein, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by the bank serving as 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 with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02) or 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 written notice thereof is given to the Administrative Agent by the Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement, (ii) the contents of any certificate, report or other document delivered hereunder or in connection herewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the 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 believed by it to be genuine and to have been signed or sent 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 be made by the proper Person, and shall not incur any liability for relying thereon.  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.

 

The Administrative Agent may perform any and all its duties and exercise its rights and powers 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 its duties and exercise its rights and powers through their respective Related Parties.  The exculpatory provisions of the preceding paragraphs 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.

 

Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, the Administrative Agent may resign at any time by notifying the Lenders and the Borrower.  Upon any such resignation, the Required Lenders shall have the right, with the consent (not to be unreasonably withheld or delayed) of the Borrower (unless an Event of Default has occurred and is continuing), to appoint a successor.  If no 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, appoint a successor Administrative Agent which shall be a bank with an office in New York, New York, or an Affiliate of any such bank.  Upon the acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations hereunder.  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 Administrative Agent’s resignation hereunder, the provisions of this Article and Section 9.03 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 it was acting as Administrative Agent.

 

Each Lender acknowledges and agrees that the extensions of credit made hereunder are commercial loans and not investments in a business enterprise or securities.  Each Lender further represents that it is engaged in making, acquiring or holding commercial loans in the ordinary course of its business and  has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement as a Lender, and to make, acquire or hold Revolving Loans hereunder.  Each Lender shall, independently and without reliance upon the Administrative Agent or any other Lender and

 

  

 

  

 

based on such documents and information (which may contain material, non-public information within the meaning of the United States securities laws concerning the Borrower and its Affiliates) 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 related agreement or any document furnished hereunder or thereunder and in deciding whether or to the extent to which it will continue as a Lender or assign or otherwise transfer its rights, interests and obligations hereunder.

 

None of the Lenders identified in this Agreement as the “Syndication Agent” shall have any right, power, obligation, liability, responsibility or duty under this Agreement in such capacity and none of the Lead Arrangers shall have any right, power, obligation, liability, responsibility or duty under this Agreement in its capacity as such.  Without limiting the foregoing, no such Lender shall have or be deemed to have a fiduciary relationship with any other Lender.  Each Lender hereby makes the same acknowledgments with respect to each such Lender as it makes with respect to the Administrative Agent in the preceding paragraph.

 

ARTICLE IX

 

Miscellaneous

 

SECTION 9.01.     Notices.

 

(a)     Except in the case of notices and other communications expressly permitted to be given by telephone (and subject to paragraph (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 telecopy or email, as follows:

 

(i)     if to the Borrower, to it at 6000 Westown Parkway, West Des Moines, Iowa 50266, Attention of Ted M. Johnson, Chief Financial Officer and Treasurer (Telecopy No. (515) 221-0744; email address tjohnson@american-equity.com);

 

(ii)     if to the Administrative Agent, to JPMorgan Chase Bank, N.A., Loan and Agency Services Group, 10 S. Dearborn, Floor L2S, Chicago, Illinois 60603, Attention of Pastell Jenkins (Telecopy No. (844) 490-5665; email address pastell.jenkins@chase.com and jpm.agency.servicing.1@jpmorgan.com), with a copy to JPMorgan Chase Bank, N.A., 10 S. Dearborn, 9th Floor, Suite IL1-0364, Chicago, Illinois 60603, Attention of Ryan Kin (Telecopy No. (312) 325-3190; email address ryan.m.kin@jpmorgan.com); and

 

(iii)     if to any other Lender, to it at its address (or telecopy number or email address) set forth in its Administrative Questionnaire.

 

(b)     Notices and other communications to the Administrative Agent and the Lenders hereunder may be delivered or furnished by Electronic Systems pursuant to Section 5.01 and other procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article II unless otherwise agreed by the Administrative Agent and the applicable Lender.  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.

 

(c)     Unless the Administrative Agent otherwise prescribes, subject to Section 5.01, (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), 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; provided that, for both clauses (i) and (ii) above, if such notice, email 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.

 

(d)     Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto.  All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt.

 

(e)     The Borrower agrees that the Administrative Agent may, but shall not be obligated to, make Communications (as defined below) available to the Lenders by posting the Communications on an Electronic System.

 

(f)     Any Electronic System used by the Administrative Agent is provided “as is” and “as available.”  The Agent Parties (as defined below) do not warrant the adequacy of such Electronic Systems and expressly disclaim liability for errors or omissions in the Communications.  No warranty or 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 Communications or any Electronic System.  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, or any other Person or entity for damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of communications through an Electronic System.  “Communications” mean, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of the Borrower pursuant to any Credit Document or the transactions contemplated therein which is distributed by the Administrative Agent or any Lender by means of electronic communications pursuant to this Section, including through an Electronic System.

 

SECTION 9.02.     Waivers; Amendments.

 

(a)     No failure or delay by the Administrative Agent or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps

 

  

 

  

 

to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.  The rights and remedies of the Administrative Agent and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of this Agreement or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default at the time.

 

(b)     Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan of any Lender or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of such Lender, (iii) postpone the scheduled date of payment of the principal amount of any Loan of any Lender, or any interest thereon, or any fees payable hereunder to any Lender, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Revolving Commitment of any Lender, without the written consent of such Lender, (iv) change Section 2.15(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of the Majority Facility Lenders in respect of each Facility adversely affected thereby, (v) change any of the provisions of this Section or reduce the percentage in the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender, or (vi) reduce the percentage specified in the definition of Majority Facility Lenders with respect to any Facility without the written consent of each Lender under such Facility; provided further, that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent without the prior written consent of the Administrative Agent.

 

(c)     Notwithstanding the foregoing, (i) upon the execution and delivery of all documentation required by Section 2.06(d) to be delivered in connection with an increase to the aggregate Revolving Commitments, the Administrative Agent, the Borrower and the new or existing Revolving Lenders whose Revolving Commitments have been affected may and shall enter into an amendment hereof (which shall be binding on all parties hereto and the new Revolving Lenders) solely for the purpose of reflecting any new Revolving Lenders and their new Revolving Commitments and any increase in the Revolving Commitment of any existing Revolving Lender (for the avoidance of doubt, the consent of the Required Lenders shall not be required to increase the Revolving Commitments pursuant to Section 2.06(d)) and (ii) upon the execution and delivery of all documentation required by Section 2.18 to be delivered in connection with an extension of the Revolving Maturity Date, the Administrative Agent, the Borrower, the Extending Lenders and any New Lenders may enter into an amendment hereof solely for the purpose of reflecting any New Lenders and the change in the Revolving Maturity

 

  

 

  

 

Date (for the avoidance of doubt, the consent of the Required Lenders shall not be required to extend the Revolving Maturity Date pursuant to Section 2.18).

 

SECTION 9.03.     Expenses; Indemnity; Damage Waiver.

 

(a)     The Borrower shall pay (i) all reasonable and documented out of pocket expenses incurred by (x) the Administrative Agent and the Lead Arrangers, including the reasonable fees, charges and disbursements of one counsel for the Administrative Agent and the Lead Arrangers in each applicable jurisdiction, in connection with the initial syndication of the credit facilities provided for herein incurred on or about the Effective Date and (y) the Administrative Agent associated with the preparation and administration of this Agreement and the other Credit Documents or any amendments, modifications or waivers of the provisions hereof (whether or not the transactions contemplated hereby or thereby shall be consummated) and (ii) all out-of-pocket expenses incurred by the Administrative Agent or any Lender, including the fees, charges and disbursements of counsel for the Administrative Agent or any Lender, in connection with the enforcement or protection of its rights in connection with this Agreement and the other Credit Documents, including its rights under this Section, or in connection with the Loans made hereunder, including all such out-of pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans, if an Event of Default exists; provided that pursuant to this clause (ii) the Borrower will be responsible for the fees and expenses of one counsel in each applicable jurisdiction for the Lenders (in addition to counsel for the Administrative Agent) except to the extent that the applicable Lenders determine that a conflict of interest requires separate counsel.

 

(b)     The Borrower shall indemnify the Administrative Agent, the Lead Arrangers and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including the reasonable and documented fees, charges and disbursements of counsel (limited to one counsel in each applicable jurisdiction for the Indemnitees (in addition to counsel for the Administrative Agent) except to the extent the applicable Indemnitees determine that a conflict of interest requires separate counsel), incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of any of the following: (i) the execution or delivery of this Agreement, the other Credit Documents or any agreement or instrument contemplated hereby, the performance by the parties hereto of their respective obligations thereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any Loan or the use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory 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, willful misconduct or bad faith of such Indemnitee, (y) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from a material breach of the obligations under the Credit Documents by such

 

  

 

  

 

Indemnitee pursuant to a claim by the Borrower or (z) result from a dispute solely among Indemnitees (not arising as a result of any act or omission by the Borrower or any of its Subsidiaries) other than claims against the Administrative Agent or the Lead Arrangers, each in its capacity as such, or in fulfilling its role as the Administrative Agent or a Lead Arranger.  This Section 9.03(b) shall not apply with respect to Taxes other than any Taxes that represent losses or damages arising from any non-Tax claim.

 

(c)     To the extent that the Borrower fails to pay any amount required to be paid by it to the Administrative Agent under paragraph (a) or (b) of this Section (and without limiting its obligation to do so), each Lender severally agrees to pay to the Administrative Agent 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 in its capacity as such.

 

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

 

(e)     To the extent permitted by applicable law, the Lenders shall not assert, and hereby waive, any claim against the Borrower, 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, the other Credit Documents or any agreement or instrument contemplated hereby, the Transactions, any Loan or the use of the proceeds thereof; provided that nothing in this paragraph (e) shall limit the Borrower’s indemnity obligations under this Section 9.03 in respect of any claims made by third parties for any special, indirect, consequential or punitive damages.

 

(f)     All amounts due under this Section shall be payable not later than five Business Days after written demand therefor.

 

SECTION 9.04.     Successors and Assigns.

 

(a)     The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section.  Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants (to the extent provided in paragraph (c) of this Section) and, to the extent

 

  

 

  

 

expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)

 

(i)     Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees (other than Ineligible Institutions) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) with the prior written consent of:

 

(A)     the Borrower (such consent not to be unreasonably withheld), 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 ten Business Days after having received notice thereof, and provided further that no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an Event of Default under clause (a), (b), (h) or (i) of Article VII has occurred and is continuing, any other assignee; and

 

(B)     the Administrative Agent (such consent not to be unreasonably withheld or delayed), provided that no consent of the Administrative Agent shall be required for an assignment of any Commitment or all or any portion of a Term Loan to an assignee that is a Lender (other than a Defaulting Lender) with a Commitment or a Term Loan, as applicable, immediately prior to giving effect to such assignment.

 

(ii)     Assignments shall be subject to the following additional conditions:

 

(A)     except in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans of any Class and under any facility, the amount of the Commitment or 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) shall not be less than $5,000,000 and integral multiples of $1,000,000 in excess thereof unless each of the Borrower and the Administrative Agent otherwise consent, provided that no such consent of the Borrower shall be required if an Event of Default under clause (a), (b), (h) or (i) of Article VII has occurred and is continuing;

 

(B)     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;

 

(C)     the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500 payable by the assignor or the assignee upon the effectiveness thereof; and

 

  

 

  

 

(D)     the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire in which the assignee designates one or more “credit contacts” to whom all syndicate-level information (which may contain material non-public information about the Borrower and its Subsidiaries and affiliates and their Related Parties or their respective securities) will be made available and who may receive such information in accordance with the assignee’s compliance procedures and applicable laws, including federal and state securities laws.

 

For the purposes of this Section 9.04(b), the term “Approved Fund” has the following meaning:

 

“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and 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.

 

(iii)     Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section, from and after the effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto 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 2.12, 2.13, 2.14 and 9.03).  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c) of this Section.

 

(iv)     The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices 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 Commitment of, and principal amount of the Loans 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 shall treat each Person whose name 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.  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.

 

(v)     Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any

 

  

 

  

 

 

written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 2.04(c), 2.15(d) or 9.03(c), the Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon.  No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.

 

(c)     Any Lender may, without the consent of the Borrower or the Administrative Agent, sell participations to one or more banks or other entities other than an Ineligible Institution (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged; (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations; and (C) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects such Participant.  Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 (subject to the requirements and limitations therein, including the requirements under Section 2.14(f) (it being understood that the documentation required under Section 2.14(f) shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant (A) agrees to be subject to the provisions of Sections 2.15 and 2.16 as if it were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment under Sections 2.12 or 2.14, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender, provided that such Participant agrees to be subject to Section 2.15(c) as though it were a Lender.  Each Lender that sells a participation shall, acting solely for this purpose as an agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under this Agreement (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant’s interest in any Commitments, Loans or its other obligations under any Credit Document) except to the extent that such disclosure is necessary to establish that such Commitment, Loan, or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.  The entries in the Participant Register shall be conclusive absent

 

  

 

  

 

manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.

 

(d)     Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

 

SECTION 9.05.     Survival.  All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as the Commitments have not expired or terminated.  The provisions of Sections 2.12, 2.14, 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Commitments or the termination of this Agreement or any provision hereof.

 

SECTION 9.06.     Counterparts; Integration; Effectiveness.  This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  This Agreement and any separate letter agreements with respect to fees payable to the Administrative Agent 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 4.01, 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 which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.  Delivery of an executed counterpart of a signature page of this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

 

SECTION 9.07.     Severability.  Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

 

  

 

  

 

SECTION 9.08.     Right of Setoff.  If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter existing under this Agreement and the other Credit Documents held by such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured.  The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.

 

SECTION 9.09.    GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS.

 

(A)    THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

 

(B)    THE BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER CREDIT DOCUMENTS, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING SHALL BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT PERMITTED BY 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 SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(C)     THE BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS 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 LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

 

(D)    EACH PARTY TO THIS AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 9.01.  NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

 

SECTION 9.10.     WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY 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, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

SECTION 9.11.     Headings.  Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

 

SECTION 9.12.     Confidentiality.  Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (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) provided that such Affiliates and other Persons are not insurance companies, (b) to the extent requested by any regulatory authority or self-regulatory body, (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the other Credit Documents or the enforcement of rights hereunder, (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 (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 (i) becomes publicly available other than as a result of a breach of this Section or (ii) becomes available to the Administrative Agent or any Lender on a non-confidential basis from a source other than the

 

  

 

  

 

Borrower; provided that such source is not bound by a confidentiality agreement with the Borrower known to the Administrative Agent or the applicable Lender, as applicable.  For the purposes of this Section, “Information” means all information received from the Borrower relating to the Borrower or its business, other than any such information that is available to the Administrative Agent or any Lender on a non-confidential basis prior to disclosure by the Borrower; provided that (x) such source is not bound by a confidentiality agreement with the Borrower known to the Administrative Agent or the applicable Lender, as applicable, and (y) in the case of information received from the Borrower 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.  In the case of clauses (b) and (c), the disclosing party shall give notice of such disclosure to the Borrower (except in the case of bank examinations) to the extent not prohibited by any requirement of law or court order.

 

EACH OF THE ADMINISTRATIVE AGENT AND THE LENDERS ACKNOWLEDGE THAT INFORMATION AS DEFINED IN SECTION 9.12(a) FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.  NOTWITHSTANDING THE FOREGOING, UNLESS SPECIFICALLY PROHIBITED BY APPLICABLE LAW OR COURT ORDER, EACH OF THE ADMINISTRATIVE AGENT AND THE LENDERS AND EACH OF THEIR RESPECTIVE AFFILIATES SHALL, PRIOR TO DISCLOSURE THEREOF, NOTIFY THE BORROWER OF ANY REQUEST FOR DISCLOSURE OF ANY SUCH NON-PUBLIC INFORMATION BY ANY GOVERNMENTAL AUTHORITY OR REPRESENTATIVE THEREOF (OTHER THAN ANY SUCH REQUEST IN CONNECTION WITH AN EXAMINATION OF THE ADMINISTRATIVE AGENT, SUCH LENDER OR SUCH AFFILIATE BY SUCH GOVERNMENTAL AGENCY) OR PURSUANT TO LEGAL PROCESS.

 

ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWER AND ITS SUBSIDIARIES AND AFFILIATES AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES.  ACCORDINGLY, EACH LENDER REPRESENTS TO THE BORROWER AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT MAY CONTAIN

 

  

 

  

 

 

MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW.

 

SECTION 9.13.     Interest Rate Limitation.  Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.

 

SECTION 9.14.     USA PATRIOT Act.  Each Lender that is subject to the requirements of the USA Patriot Act hereby notifies the Borrower that pursuant to the requirements of the USA Patriot 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 to identify the Borrower in accordance with the USA Patriot Act.

 

SECTION 9.15.     Acknowledgements.  The Borrower hereby acknowledges and agrees that (a) no fiduciary, advisory or agency relationship between the Borrower and the Lenders is intended to be or has been created in respect of any of the transactions contemplated by this Agreement or the other Credit Documents, irrespective of whether the Lenders have advised or are advising the Borrower on other matters, and the relationship between the Lenders, on the one hand, and the Borrower, on the other hand, in connection herewith and therewith is solely that of creditor and debtor, (b) the Lenders, on the one hand, and the Borrower, on the other hand, have an arm’s length business relationship that does not directly or indirectly give rise to, nor does the Borrower rely on, any fiduciary duty to the Borrower or its Affiliates on the part of the Lenders, (c) the Borrower is capable of evaluating and understanding, and the Borrower understands and accepts, the terms, risks and conditions of the transactions contemplated by this Agreement and the other Credit Documents, (d) the Borrower has been advised that the Lenders are engaged in a broad range of transactions that may involve interests that differ from the Borrower’s interests and that the Lenders have no obligation to disclose such interests and transactions to the Borrower, (e) the Borrower has consulted their own legal, accounting, regulatory and tax advisors to the extent the Borrower has deemed appropriate in the negotiation, execution and delivery of this Agreement and the other Credit Documents, (f) each Lender has been, is, and will be acting solely as a principal and, except as otherwise expressly agreed in writing by it and the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower, any of its Affiliates or any other Person, (g) none of the Lenders has any obligation to the Borrower or its Affiliates with respect to the transactions contemplated by this Agreement or the other Credit Documents except those obligations expressly set forth herein or therein or in any other express writing executed and delivered by

 

  

 

  

 

such Lender and the Borrower or any such Affiliate and (h) no joint venture is created hereby or by the other Credit Documents or otherwise exists by virtue of the transactions contemplated hereby among the Lenders or among the Borrower and the Lenders.

 

SECTION 9.16.     Acknowledgement and Consent to Bail-In of EEA Financial Institutions.  Notwithstanding anything to the contrary in any Credit Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Credit Document may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

 

(b) the effects of any Bail-In Action on any such liability, including, if applicable:

 

(i) a reduction in full or in part or cancellation of any such liability;

 

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Credit Document; or

 

(iii) the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.

 

[signature pages follow]

 

  

 

  

 

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

 

	  	
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY, as Borrower

	  
	  	  	  	  
	  	
By:

	
/s/ Ted M. Johnson

	  
	  	  	
Name:

	
Ted M. Johnson

	  
	  	  	
Title:

	
Chief Financial Officer and Treasurer

	  

  

 

  

 

	  	
JPMORGAN CHASE BANK, N.A., individually and as Administrative Agent

	  
	  	  	  	  
	  	
By:

	
/s/ Ryan M. Kin

	  
	  	  	
Name:

	
Ryan M. Kin

	  
	  	  	
Title:

	
Vice President

	  

  

 

  

 

	  	
SUNTRUST BANK, individually and as Syndication Agent

	  
	  	  	  	  
	  	
By:

	
/s/ Paula Mueller

	  
	  	  	
Name:

	
Paula Mueller

	  
	  	  	
Title:

	
Director

	  

  

 

  

	  	
CITIBANK, N.A., individually and as Co-Documentation Agent

	  
	  	  	  	  
	  	
By:

	
/s/ John Modin

	  
	  	  	
Name:

	
John Modin

	  
	  	  	
Title:

	
Managing Director and Vice President

	  

  

 

  

	  	
ROYAL BANK OF CANADA, individually and as Co-Documentation Agent

	  
	  	  	  	  
	  	
By:

	
/s/ Brij Grewal

	  
	  	  	
Name:

	
Brij Grewal

	  
	  	  	
Title:

	
Authorized Signatory

	  

  

 

  

 

	  	
BANKERS TRUST COMPANY, as a Lender

	  
	  	  	  	  
	  	
By:

	
/s/ Jon Doll

	  
	  	  	
Name:

	
Jon Doll

	  
	  	  	
Title:

	
Vice President

	  

  

 

  

	  	
West Bank, as a Lender

	  
	  	  	  	  
	  	
By:

	
/s/ Kevin J. Smith

	  
	  	  	
Name:

	
Kevin J. Smith

	  
	  	  	
Title:

	
Sr. Vice President

	  

  

 

  

 

Schedule 2.01

 

Commitments

 

	
Lender

	  	
Revolving  Commitment

	 	
Term Commitment

	
JPMorgan Chase Bank, N.A.

	  	
$35,500,000.00

	 	
$32,000,000.00

	
SunTrust Bank

	  	
$35,500,000.00

	 	
$32,000,000.00

	
Citibank, N.A.

	  	
$30,000,000.00

	 	
$15,000,000.00

	
Royal Bank of Canada

	  	
$24,000,000.00

	 	
$16,000,000.00

	
West Bank

	  	
$15,000,000.00

	 	
$5,000,000.00

	
Bankers Trust Company

	  	
$10,000,000.00

	 	
$0.00

	  	  	
$150,000,000.00

	 	
$100,000,000.00

 

  

 

  

 

Schedule 3.07

 

Borrower’s Subsidiaries

 

	
Subsidiary

	
State of Incorporation

	
Material Subsidiary?

	
American Equity Investment Life Insurance Company

	
Iowa

	
Yes

	
American Equity Investment Life Insurance Company of New York

	
New York

	
No

	
Eagle Life Insurance Company

	
Iowa

	
No

	
American Equity Investment Service Company

	
Iowa

	
No

	
American Equity Investment Properties, L.C.

	
Iowa

	
No

	
American Equity Capital, Inc.

	
Iowa

	
No

	
American Equity Capital Trust I

	
Iowa

	
No

	
American Equity Capital Trust II

	
Iowa

	
No

	
American Equity Capital Trust III

	
Iowa

	
No

	
American Equity Capital Trust IV

	
Iowa

	
No

	
American Equity Capital Trust V

	
Iowa

	
No

	
American Equity Capital Trust VI

	
Iowa

	
No

	
American Equity Capital Trust VII

	
Iowa

	
No

	
American Equity Capital Trust VIII

	
Iowa

	
No

	
American Equity Capital Trust IX

	
Iowa

	
No

	
American Equity Capital Trust X

	
Iowa

	
No

	
American Equity Capital Trust XI

	
Iowa

	
No

	
American Equity Capital Trust XII

	
Iowa

	
No

	
AERL, L.C.

	
Iowa

	
No

	
American Equity Advisors, Inc.

	
Iowa

	
No

 

  

 

  

 

Schedule 6.01

 

Existing Debt

 

None.

  

 

  

 

Schedule 6.02

 

Existing Liens

 

None.

  

 

  

 

Schedule 6.06

 

Ceded Reinsurance

 

 

	
Treaty

	
Reinsurer

	
Description

	
2013 Hannover Reinsurance Treaty

	
Hannover Life Reassurance Company

	
Yearly renewable term reinsurance agreement covering 45.6% of waived surrender charges related to penalty free partial withdrawals, deaths and Lifetime Income Benefit Rider (LIBR) payments and also LIBR payments greater than the fund value of the underlying contracts on certain business

  

 

  

 

Schedule 6.10

 

Restrictive Agreements

 

None.

  

 

  

EXHIBIT A

ASSIGNMENT AND ASSUMPTION

 

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”).  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as may be amended, restated, amended and restated, modified or supplemented from time to time, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions set forth in Annex 1 and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including any guarantees included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”).  Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.

 

	
1.

	
Assignor:

	
_________________________

 

	
  

	
2.

	
Assignee:

	
_________________________

 

	
  

	
[and is an Affiliate/Approved Fund of [identify Lender]1]

 

	
3.

	
Borrower:

	
American Equity Investment Life Holding Company

 

	
4.

	
Administrative Agent:  JPMorgan Chase Bank, N.A., as the Administrative Agent under the Credit Agreement

 

___________________________________

1           Select as applicable.

  

 

  

 

	
5.

	
Credit Agreement:  The Credit Agreement, dated as of September 30, 2016 among American Equity Investment Life Holding Company, as Borrower, the Lenders from time to time party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent.

 

	
6.

	
Assigned Interest:

 

	
Facility Assigned2

	
Aggregate Amount of Commitment/Loans

for all Lenders

	
Amount of

Commitment/Loans

Assigned3

	
Percentage Assigned

of

Commitment/Loans4

	  	
$

	
$

	
%

	  	
$

	
$

	
%

	  	
$

	
$

	
%

Effective Date: _________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

 

The Assignee agrees to deliver to the Administrative Agent a completed Administrative Questionnaire5 in which the Assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about the Borrower and its related parties or its respective securities) will be made available and who may receive such information in accordance with the Assignee’s compliance procedures and applicable laws, including Federal and state securities laws.

 

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

	  	
ASSIGNOR

	  
	  	  	  
	  	
[NAME OF ASSIGNOR]

	  
	  	  	  	  
	  	
By:

	  	  
	  	  	
Title:

	  	  

___________________________________

2           Fill in the appropriate terminology for the types of facilities under the Credit Agreement that are being assigned under this Assignment (e.g. “Revolving Commitment”, “Term Loans”, etc.)

3           Cannot be less than $5,000,000 and integral multiples of $1,000,000 in excess thereof, unless the assignment is to a Lender, Affiliate, Approved Fund or for the entire remaining amount of the Assignor’s commitment or Loan of any class.

4           Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

5           An Administrative Questionnaire is not required if assignee is a Lender.

  

 

  

 

 

	  	
ASSIGNEE

	  
	  	  	  
	  	
[NAME OF ASSIGNEE]

	  
	  	  	  	  
	  	
By:

	  	  
	  	  	
Title:

	  	  

  

 

  

	
[Consented to and]6 Accepted:

	  
	  	  
	
JPMORGAN CHASE BANK, N.A., as Administrative Agent

	  
	  	  
	  	  
	
By:

	  	  
	  	
Title:

	  	  
	  	  	  	  

	
[Consented to:]7

	  
	  	  
	
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

	  
	  	  
	  	  
	
By:

	  	  
	  	
Title:

	  	  
	  	  	  	  

___________________________________

6           To be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement.

7           To be added only if the consent of the Borrower is required by the terms of the Credit Agreement.

  

 

  

ANNEX 1

STANDARD TERMS AND CONDITIONS FOR

 

ASSIGNMENT AND ASSUMPTION

 

1.           Representations and Warranties.

 

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

 

1.2.           Assignee.  The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, and (v) if it is a Non-U.S. Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Credit Documents are required to be performed by it as a Lender.

 

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

 

  

 

  

 

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

 

  

 

  

EXHIBIT B

FORM OF BORROWING NOTICE

 

______________, 20__

 

   

	To:	 	
JPMorgan Chase Bank, N.A., as Administrative Agent

10 S. Dearborn St. Floor L2

Chicago, IL  60606

 

 

The undersigned, American Equity Investment Life Holding Company (the “Borrower”), refers to the Credit Agreement, dated as of [     ], 2016 (as amended, restated, amended and restated, modified or supplemented from time to time, the “Credit Agreement”), among the Borrower, the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.  Capitalized terms used herein have the meanings assigned to them in the Credit Agreement.  The Borrower hereby irrevocably requests a Borrowing, pursuant to Section 2.03 of the Credit Agreement, as follows:

 

(i)     The Type of Borrowing requested is a [Revolving] [Term] Borrowing.

 

(ii)     The aggregate principal amount of the requested Borrowing is $________.

 

(iii)     The Business Day on which the Borrower requests the Borrowing to be made is ___________________, 20__.

 

(iii)     The requested Borrowing is a[n] [Eurodollar] [ABR] Borrowing.

 

(iv)     If a Eurodollar Borrowing, the Interest Period for the requested Borrowing is ____ [one, two, three or six] months.

 

(v)     The requested Borrowing shall be funded to Borrower’s account no. ____________________, located at ____________________.

 

	  	
Very truly yours,

	  
	  	  	  
	  	
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

	  
	  	  	  	  
	  	  	  	  
	  	
By:

	  	  
	  	  	
Name:

	  	  
	  	  	
Title:

	  	  

 

 

  

 

  

EXHIBIT C-1

REVOLVING NOTE

 

	
$___,000,000

	
[     ], 2016

American Equity Investment Life Holding Company, an Iowa corporation (the “Borrower”), promises to pay to ________________ (the “Lender”) the aggregate unpaid principal amount of the Revolving Loans made by the Lender to the Borrower pursuant to Article II of the Credit Agreement (as hereinafter defined), in immediately available funds at the main office of JPMorgan Chase Bank, N.A. in New York, New York, as Administrative Agent, together with interest on the unpaid principal amount hereof at the rates and on the dates set forth in the Credit Agreement.  The Borrower shall pay the principal of and accrued and unpaid interest on the Revolving Loans in full on the Revolving Maturity Date.

 

The Lender shall, and is hereby authorized to, record in accordance with its usual practice, the date and amount of each Revolving Loan and the date and amount of each principal payment hereunder.

 

This Revolving Note is one of the Notes issued pursuant to, and is entitled to the benefits of, the Credit Agreement dated as of September 30, 2016 (which, as it may be amended, restated, amended and restated or modified and in effect from time to time, is herein called the “Credit Agreement”), among the Borrower, the lenders party thereto, including the Lender, and JPMorgan Chase Bank, N.A., as Administrative Agent; reference to the Credit Agreement is hereby made for a statement of the terms and conditions governing this Revolving Note, including the terms and conditions under which this Revolving Note may be prepaid or its maturity date accelerated.  Capitalized terms used herein and not otherwise defined herein are used with the meanings attributed to them in the Credit Agreement.

 

This Revolving Note is to be governed by and construed and enforced in accordance with the laws of the State of New York.

 

[SIGNATURE PAGE FOLLOWS]

 

  

 

  

 

IN WITNESS WHEREOF, the undersigned has executed this Revolving Note by its duly authorized officer.

 

	  	
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

	  
	  	  	  	  
	  	  	  	  
	  	
By:

	  	  
	  	  	
Name:

	  	  
	  	  	
Title:

	  	  

  

 

  

EXHIBIT C-2

TERM NOTE

 

	
$___,000,000

	
[    ], 2016

American Equity Investment Life Holding Company, an Iowa corporation (the “Borrower”), promises to pay to ________________ (the “Lender”) the aggregate unpaid principal amount of the Term Loans made by the Lender to the Borrower pursuant to Article II of the Credit Agreement (as hereinafter defined), in immediately available funds at the main office of JPMorgan Chase Bank, N.A. in New York, New York, as Administrative Agent, together with interest on the unpaid principal amount hereof at the rates and on the dates set forth in the Credit Agreement.  The Borrower shall pay the principal of and accrued and unpaid interest on the Term Loans in full on the Term Maturity Date.

 

The Lender shall, and is hereby authorized to, record in accordance with its usual practice, the date and amount of each Term Loan and the date and amount of each principal payment hereunder.

 

This Term Note is one of the Notes issued pursuant to, and is entitled to the benefits of, the Credit Agreement dated as of September 30, 2016 (which, as it may be amended, restated, amended and restated or modified and in effect from time to time, is herein called the “Credit Agreement”), among the Borrower, the lenders party thereto, including the Lender, and JPMorgan Chase Bank, N.A., as Administrative Agent; reference to the Credit Agreement is hereby made for a statement of the terms and conditions governing this Term Note, including the terms and conditions under which this Term Note may be prepaid or its maturity date accelerated.  Capitalized terms used herein and not otherwise defined herein are used with the meanings attributed to them in the Credit Agreement.

 

This Term Note is to be governed by and construed and enforced in accordance with the laws of the State of New York.

 

[SIGNATURE PAGE FOLLOWS]

 

  

 

  

 

IN WITNESS WHEREOF, the undersigned has executed this Term Note by its duly authorized officer.

 

	  	
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

	  
	  	  	  	  
	  	  	  	  
	  	
By:

	  	  
	  	  	
Name:

	  	  
	  	  	
Title:

	  	  

  

 

  

 

EXHIBIT D-1

 

FORM OF U.S. TAX CERTIFICATE

 

(For Non-U.S. Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement dated as of September 30, 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among American Equity Investment Life Holding Company, each Lender from time to time party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.

 

Pursuant to the provisions of Section 2.14 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as well as any note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code and (iv) it is not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME OF LENDER]

	  
	  	  
	  	  
	
By:

	  	  
	  	
Name:

	  	  
	  	
Title:

	  	  

Date:  _____________________ __, 20[  ]

 

  

 

  

EXHIBIT D-2

 

FORM OF U.S. TAX CERTIFICATE

 

(For Non-U.S. Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement dated as of September 30, 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among American Equity Investment Life Holding Company, each Lender from time to time party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.

 

Pursuant to the provisions of Section 2.14 of the Credit Agreement, the undersigned hereby certifies that the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender in writing, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME OF PARTICIPANT]

	  
	  	  
	  	  
	
By:

	  	  
	  	
Name:

	  	  
	  	
Title:

	  	  

Date:  _____________________ __, 20[  ]

 

  

 

  

EXHIBIT D-3

 

FORM OF U.S. TAX CERTIFICATE

 

(For Non-U.S. Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement dated as of September 30, 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among American Equity Investment Life Holding Company, each Lender from time to time party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.

 

Pursuant to the provisions of Section 2.14 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect such participation, neither the undersigned nor any of direct or indirect its partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, (v) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code, and (vi) the interest payments in question are not effectively connected with the undersigned’s or its direct or indirect partners/members’ conduct of a U.S. trade or business.

 

The undersigned has furnished its participating Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME OF PARTICIPANT]

	  
	  	  
	  	  
	
By:

	  	  
	  	
Name:

	  	  
	  	
Title:

	  	  

Date:  _____________________ __, 20[  ]

 

  

 

  

EXHIBIT D-4

FORM OF U.S. TAX CERTIFICATE

 

(For Non-U.S. Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Credit Agreement dated as of September 30, 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among American Equity Investment Life Holding Company, each Lender from time to time party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.

 

Pursuant to the provisions of Section 2.14 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit pursuant to this Credit Agreement or any other Credit Document, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME OF LENDER]

	  
	  	  
	  	  
	
By:

	  	  
	  	
Name:

	  	  
	  	
Title:

	  	  

Date:  _____________________ __, 20[  ]

 

  

 

  

EXHIBIT E

FORM OF COMPLIANCE CERTIFICATE

 

___________________, 20__

 

Reference is made to the Credit Agreement, dated as of September 30, 2016 (the “Credit Agreement”), among American Equity Investment Life Holding Company (the “Borrower”), the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.  Capitalized terms used herein have the meanings assigned to them in the Credit Agreement.  The undersigned hereby certifies, in his or her capacity as a Financial Officer of the Borrower, as follows:

 

(i)     Enclosed herewith is a copy of the [annual audited/quarterly] financial statements of the Borrower as at ___________________  (the “Computation Date”), which statements fairly present in all material respects the financial condition and results of operations of the Borrower and its Consolidated Subsidiaries as of the Computation Date on a consolidated basis in accordance with GAAP [, subject to the absence of footnotes].

 

(ii)     No Default has occurred and is continuing as of the date of this Certificate [or if a Default has occurred and is continuing, specify the details of the Default and any action taken or proposed to be taken with respect thereto].

 

(iii)     The computations set forth on the schedule attached hereto correspond to the ratios and/or financial restrictions contained in Sections 6.11, 6.12 and 6.14 of the Credit Agreement and such computations are true and correct as at the Computation Date.

 

	  	
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

	  
	  	  	  	  
	  	  	  	  
	  	
By:

	  	  
	  	  	
Print Name:

	  	  
	  	  	
Title:

	  	  

  

 

  

Schedule to Compliance Certificate

Dated as of __________________*

 

	
A.        Section 6.11 - Maximum Ratio of Debt to Capital

 

	
1.           Adjusted Consolidated Debt

 

	
$__________

 

	
Adjusted Total Capitalization:

 

	  
	
2.           Total Capitalization

 

	
$__________

 

	
3.           Accumulated Other Comprehensive Loss

 

	
$__________

 

	
4.           Accumulated Other Comprehensive Income

 

	
$__________

 

	
5.           (2) plus (3) or (2) minus (4), as applicable

 

	
$__________

 

	
6.           Ratio of (1) to (5)

 

	
______ to 1

 

	
7.           Maximum allowed

 

	
0.35 to 1.00

 

	
8.           In Compliance:

 

	
Yes/No

 

	
B.        Section 6.12 - Minimum Risk-Based Capital Ratio

 

	
1.           Total Adjusted Capital

 

	
$__________

 

	
2.           Authorized Control Level Risk-Based Capital

 

	
$__________

 

	
3.           Item (2) multiplied by two (2)

 

	
$__________

 

	
4.           Ratio of (1) to (3)

 

	
___%

 

	
5.           Minimum allowed

 

	
275%

 

	
6.           In Compliance:

 

	
Yes/No

 

	
C.        Section 6.14 - Minimum Statutory Surplus

 

	  
	
Statutory Surplus of American Equity Life as of date of determination

 

	
$__________

 

	
Minimum Required:

 

	
$__________

 

___________________________________

	
*

	
The descriptions of the calculations set forth in this certificate are sometimes abbreviated for simplicity, but are qualified in their entirety by reference to the full text of the calculations provided in the Credit Agreement.

 

  

 

  

 

	
1.         Eighty percent (80%) of the Statutory Surplus of American Equity Life as of the last day of the Fiscal Quarter ended most recently prior to the Effective Date

 

	
$__________

 

	
2.         Fifty percent (50%) of the statutory net income (positive) of American Equity Life for each Fiscal Quarter ending after the Effective Date

 

	
$__________

 

	
3.         Fifty percent (50%) of all capital contributed to American Equity Life following the Fiscal Quarter-end immediately preceding the Effective Date

 

	
$__________

 

	
4.         Sum of (1), (2) and (3)

 

	
$__________

 

	
5.         In Compliance:

 

	
Yes/No

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