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Exhibit 10 (k) - Revolving Credit Agreement
EXECUTION COPY
REVOLVING CREDIT AGREEMENT
between
AVATAR PROPERTIES INC.,
a Florida corporation
and
BERLINER HANDELS- UND FRANKFURTER BANK,
Acting Through Its Grand Cayman Branch
November 30, 1993
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CREDIT AGREEMENT
Table of Contents
SECTION I. INTERPRETATION . . . . . . . . . . . . . . . . . . 1
1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . 1
1.02. GAAP . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.03. Headings . . . . . . . . . . . . . . . . . . . . . . . . 10
1.04. Plural Terms . . . . . . . . . . . . . . . . . . . . . . 10
1.05. Time . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.06. Calculation of Interest and Fees . . . . . . . . . . . . 10
1.07. Other Interpretive Provisions . . . . . . . . . . . . . 10
SECTION II. CREDIT FACILITY . . . . . . . . . . . . . . . . . . 11
2.01. Revolving Loan Facility . . . . . . . . . . . . . . . . 11
2.02. Commitment . . . . . . . . . . . . . . . . . . . . . . . 12
2.03. Commitment Fee . . . . . . . . . . . . . . . . . . . . . 13
2.04. Upfront Fee . . . . . . . . . . . . . . . . . . . . . . 13
2.05. Prepayments . . . . . . . . . . . . . . . . . . . . . . 13
2.06. Other Payment Terms . . . . . . . . . . . . . . . . . . 14
2.07. Notes and Interest Account . . . . . . . . . . . . . . . 14
2.08 Loan Funding . . . . . . . . . . . . . . . . . . . . . . 15
2.09. Change of Circumstances . . . . . . . . . . . . . . . . 15
2.10. Taxes on Payments . . . . . . . . . . . . . . . . . . . 16
2.11. Funding Loss Indemnification . . . . . . . . . . . . . . 18
2.12. Renewal or Termination of Commitment . . . . . . . . . . 18
2.13. Pledge Agreement; Further Assurances . . . . . . . . . . 18
SECTION III. CONDITIONS PRECEDENT . . . . . . . . . . . . . . 19
3.01. Conditions to Initial Loan . . . . . . . . . . . . . . . 19
3.02. Conditions to Each Loan . . . . . . . . . . . . . . . . 20
SECTION IV. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . 20
4.01 Due Incorporation, Qualification, etc. . . . . . . . . . 20
4.02 Authority . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION V. COVENANTS . . . . . . . . . . . . . . . . . . . . . 23
5.01. Affirmative Covenants . . . . . . . . . . . . . . . . . 23
5.02. Negative Covenants . . . . . . . . . . . . . . . . . . . 26
SECTION VI. DEFAULT . . . . . . . . . . . . . . . . . . . . . 26
6.01. Events of Default . . . . . . . . . . . . . . . . . . . 26
6.02. Remedies . . . . . . . . . . . . . . . . . . . . . . . . 28
6.03. Defaults . . . . . . . . . . . . . . . . . . . . . . . . 28
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SECTION VII. MISCELLANEOUS . . . . . . . . . . . . . . . . . . 29
7.01. Notices . . . . . . . . . . . . . . . . . . . . . . . . 29
7.02. Expenses . . . . . . . . . . . . . . . . . . . . . . . . 29
7.03. Indemnification . . . . . . . . . . . . . . . . . . . . 30
7.04. Waivers; Amendments . . . . . . . . . . . . . . . . . . 30
7.05. Successors and Assigns . . . . . . . . . . . . . . . . . 30
7.06. Setoff. . . . . . . . . . . . . . . . . . . . . . . . . 31
7.07. No Third Party Rights . . . . . . . . . . . . . . . . . 31
7.08. Partial Invalidity . . . . . . . . . . . . . . . . . . . 32
7.09. Governing Law . . . . . . . . . . . . . . . . . . . . . 32
7.10. Entire Agreement . . . . . . . . . . . . . . . . . . . . 32
7.11. Jury Trial . . . . . . . . . . . . . . . . . . . . . . . 32
7.12. Counterparts . . . . . . . . . . . . . . . . . . . . . . 32
EXHIBITS
A Notice of Borrowing (2.01(b))
B Loan Note (2.07(a))
C Form of Revolver Extension Request (2.12)
D Form of Pledge Agreement (2.13(a))
E Form of Opinion of Borrower's Counsel (3.01)
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REVOLVING CREDIT AGREEMENT
THIS REVOLVING CREDIT AGREEMENT, dated as of November
30, 1993, is entered into by and between AVATAR PROPERTIES INC.,
a Florida corporation ("Borrower") and BERLINER HANDELS- UND
FRANKFURTER BANK, acting through its Grand Cayman Branch,
("Bank").
RECITALS
A. Borrower has requested Bank to provide certain
credit facilities to Borrower secured by a portion of Borrower's
Fixed Income Securities (as defined herein) for general corporate
purposes.
B. Bank is willing to provide such credit facilities
upon the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the above Recitals
and the mutual covenants herein contained, the parties hereto
hereby agree as follows:
SECTION I. INTERPRETATION.
1.01. Definitions. Each of the following terms set forth
below, when used in this Agreement, shall have the respective
meaning set forth below:
"Affiliate" shall mean, with respect to any Person, (a)
each Person that, directly or indirectly, owns or controls,
whether beneficially or as a trustee, guardian or other
fiduciary, five percent (5%) or more of any class of Equity
Securities of such Person, (b) each Person that controls, is
controlled by or is under common control with such Person or any
Affiliate of such Person or (c) each of such Person's officers,
directors, joint venturers and partners; provided, however, that
in no case shall Bank be deemed to be an Affiliate of Debtors for
purposes of this Agreement. For the purpose of this definition,
"control" of a Person shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of its
management or policies, whether through the ownership of voting
securities, by contract or otherwise.
"Agreement" shall mean this Credit Agreement.
"Available Commitment" shall mean, at any time, the
remainder of (a) the Commitment at such time, minus (b) the
aggregate principal amount of all Loans outstanding at such time.
"Bank" shall have the meaning given to that term in the
introductory paragraph hereof.
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"Base Rate" means the rate per annum announced by the
Bank from time to time at its New York office as its "base rate".
The Base Rate is determined by the Bank from time to time as a
means of pricing credit extensions to some customers and is
neither directly tied to any external rate of interest or index
nor necessarily the lowest rate of interest charged by the Bank
at any given time for any particular class of customers or credit
extensions.
"Borrowing Base" shall mean, as at any date of
determination thereof an amount equal to the sum of:
(a) seventy-five percent (75%) of the Market
Value of the Investment Collateral which is rated B3
or above by Moody's and B- or above by S&P;
(b) fifty percent (50%) of the Market Value of
the Investment Collateral rated below B3 by Moody's or
below B- by S&P; and
(c) fifty percent (50%) of the Market Value of
Investment Collateral which is not rated by either
Moody's or S&P.
"Borrower" shall have the meaning given to that term in
the introductory paragraph hereof.
"Business Day" shall mean any day on which (a)
commercial banks are not authorized or required to close in New
York, New York and (b) dealings in Dollar deposits are carried
out in the London interbank market.
"Capital Adequacy Requirement" shall have the meaning
given to that term in Section 2.09(d).
"Capital Asset" shall mean, with respect to any Person,
tangible property owned or leased (in the case of a Capital
Lease) by such Person, or any expense incurred by any Person that
is required by GAAP to be reported as an asset on such Person's
balance sheet.
"Capital Expenditures" shall mean, with respect to any
Person and any period, all amounts expended and Indebtedness
incurred or assumed by such Person during such period for the
acquisition of real property and other Capital Assets (including
amounts expended and Indebtedness incurred or assumed in
connection with Capital Leases).
"Capital Leases" shall mean any and all lease
obligations that, in accordance with generally accepted
accounting principles, are required to be capitalized on the
books of a lessee.
"Change of Law" shall have the meaning given to that
term in Section 2.09(b).
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"Closing Date" shall mean November 30, 1993.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
"Collateral" shall mean the property defined as
Collateral in the Pledge Agreement.
"Commitment" shall have the meaning given to that term
in Section 2.02(a).
"Commitment Fee" shall have the meaning given to that
term in Section 2.03.
"Contractual Obligation" of any Person shall mean, any
indenture, note, security, deed of trust, mortgage, security
agreement, lease, guaranty, instrument, contract, agreement or
other form of obligation or undertaking to which such Person is a
party or by which such Person or any of its property is bound.
"Credit Documents" shall mean and include this
Agreement, the Notes, the Pledge Agreement and all other
documents, instruments and agreements delivered to Bank in
connection with this Agreement.
"Default" shall mean any event or circumstance not yet
constituting an Event of Default but which, with the giving of
any notice or the lapse of any period of time or both, would
become an Event of Default.
"Dollars" and "$" shall mean the lawful currency of the
United States of America and, in relation to any payment under
this Agreement, same day or immediately available funds.
"Employee Benefit Plan" shall mean any employee benefit
plan within the meaning of section 3(3) of ERISA maintained or
contributed to by Borrower.
"Environmental Laws" means all Requirements of Law
relating to the protection of human health or the environment,
including: (a) all Requirements of Law, pertaining to reporting,
licensing, permitting, investigation, and remediation of
emissions, discharges, releases, or threatened releases of
hazardous materials, chemical substances, pollutants,
contaminants, or hazardous or toxic substances, materials or
wastes whether solid, liquid, or gaseous in nature, into the air,
surface water, groundwater, or land, or relating to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of chemical substances,
pollutants, contaminants, or hazardous or toxic substances,
materials, or wastes, whether solid, liquid, or gaseous in
nature; and (b) all Requirements of Law pertaining to the
protection of the health and safety of employees or the public.
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"Equity Securities" of any Person shall mean (a) all
common stock, preferred stock, participations, shares,
partnership interests or other equity interests in and of such
Person (regardless of how designated and whether or not voting or
non-voting) and (b) all warrants, options and other rights to
acquire any of the foregoing.
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as the same may from time to time be
amended or supplemented, including any rules or regulations
issued in connection therewith.
"ERISA Affiliate" shall mean any Person which is
treated as a single employer with Borrower under Section 414 of
the Code.
"ERISA Plan" means any employee pension plan, as
defined in Section 3(2) of ERISA, which (i) is not an individual
account plan, as defined in Section 3(34) of ERISA or a
multiemployer plan, as defined in Section 3(37) of ERISA, (ii) is
subject to Title IV of ERISA, and (iii) Borrower or any ERISA
Affiliate maintains, contributes to, or has an obligation to
contribute to, on behalf of participants who are or were employed
by any of them.
"Event of Default" shall have the meaning given to that
term in Section 6.01.
"Federal Reserve Board" shall mean the Board of
Governors of the Federal Reserve System.
"Financial Statements" shall mean, with respect to any
accounting period for any Person, statements of income and of
changes in cash flow of such Person for such period, and balance
sheets of such Person as of the end of such period, setting forth
in each case in comparative form figures for the corresponding
period in the preceding fiscal year if such period is less than a
full fiscal year or, if such period is a full fiscal year,
corresponding figures from the preceding annual audit, all
prepared in reasonable detail and in accordance with GAAP.
"Fixed-Income Securities" means any securities that
entitle the holder to receive:
(a) a stated principal amount; or
(b) interest on a principal amount (which may be a
notional principal amount) calculated by reference to a fixed
rate or to a standard or formula which does not reference any
change in the market value or fair value of securities or assets;
or
(c) interest on a principal amount (which may be a
notional principal amount) calculated by reference to auctions
among holders and prospective holders, or through remarketing of
the security; or
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(d) an amount equal to specified fixed or variable
portions of the interest received on the assets held by the
issuer; or
(e) any combination of amounts described in paragraphs
(a), (b), (c), and (d) of this section;
provided, that (i) substantially all of the payments to which the
holders of such securities are entitled in respect thereof
consist of the foregoing amounts and (ii) in no event shall the
term Fixed-Income Securities include any Margin Stock.
"GAAP" shall mean generally accepted accounting
principles and practices as in effect in the United States of
America from time to time, consistently applied.
"Governmental Authority" shall mean any domestic or
foreign national, state or local government, any political
subdivision thereof, any department, agency, authority or bureau
of any of the foregoing, or any other entity exercising
executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, including, without
limitation, the Federal Deposit Insurance Corporation, the
Federal Reserve Board, the Comptroller of the Currency, any
central bank or any comparable authority.
"Governmental Charges" shall mean all levies,
assessments, fees, claims or other charges imposed by any
Governmental Authority upon or relating to (i) Borrower or
Borrower's Subsidiaries, (ii) the Loans, (iii) employees,
payroll, income or gross receipts of Borrower or Borrower's
Subsidiaries, (iv) the ownership or use of any of its assets by
Borrower or Borrower's Subsidiaries or (v) any other aspect of
the business of Borrower or Borrower's Subsidiaries.
"Governmental Rule" shall mean any law, rule,
regulation, ordinance, order, code interpretation, judgment,
decree, directive, guidelines, policy or similar form of decision
of any Governmental Authority.
"Holdings" means Avatar Holdings Inc., a Delaware
Corporation.
"Indebtedness" of any Person shall mean (i)
indebtedness for borrowed money or for the deferred purchase
price of property or services, (ii) obligations of the Borrower
as lessee under leases which shall have been or should be, in
accordance with generally accepted accounting principles,
recorded as capital leases, (iii) obligations under direct or
indirect guaranties in respect of, and obligations (contingent or
otherwise) to purchase or otherwise acquire, or otherwise to
assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clause (i) or
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(ii) above, and (iv) liabilities in respect of unfunded vested
benefits under plans covered by Title IV of ERISA.
"Interest Account" shall have the meaning given to that
term in Section 2.07(b).
"Interest Period" shall mean, with respect to any Loan,
the time period selected by Borrower pursuant to Section 2.01(b),
which commences on the first day of such Loan and ends on the
last day of such time period, and thereafter, each subsequent
time period selected by Borrower pursuant to Section 2.01(d),
which commences on the last day of the immediately preceding time
period and ends on the last day of that time period; provided,
however, that "Interest Period" shall also mean, in respect of
any amounts in default, such periods as Bank elects pursuant to
Section 2.06(c).
"Investment" of any Person shall mean any loan or
advance of funds by such Person to any other Person (other than
advances to employees of such Person for moving and travel
expense, drawing accounts and similar expenditures in the
ordinary course of business), any purchase or other acquisition
of any Equity Securities or Indebtedness of any other Person, any
capital contribution by such Person to or any other investment by
such Person in any other Person (including, without limitation,
any Indebtedness incurred by such Person of the type described in
clauses (b) and (c) of the definition of "Indebtedness" on behalf
of any other Person); provided, however, Investments shall not
include indebtedness and accounts receivable from any Person
which are current assets arising from sales in the ordinary
course of business.
"Investment Collateral" shall mean the Borrower's
interest in Fixed-income Securities held in the Investment
Collateral-Accounts.
"Investment Collateral-Accounts" shall mean the account
no. 38-23013 maintained by the Borrower at Morgan Stanley & Co.,
and account no. 40153742 maintained by Borrower at Offit Bank and
any other brokerage or investment account maintained by Borrower
with a commercial bank or nationally recognized brokerage firm
that Borrower, with the consent of Bank, from time to time
includes as an Investment Collateral-Account; provided, however,
that:
(i) No account may constitute an Investment
Collateral-Account unless Borrower is the sole owner of the
securities deposited therein;
(ii) No account shall constitute an Investment
Collateral-Account unless and until Bank has received an
appropriately completed and executed acknowledgment from
such bank or brokerage firm of Bank's security interest in
the Borrower's interest therein in form and substance
satisfactory to Bank; and
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(iii) No account shall constitute an Investment
Collateral-Account unless and until Bank shall have
satisfied itself as to the enforceability and perfection of
Bank's security interest therein and shall have received
such opinions and other assurances in that regard as Bank
may require.
"LIBOR Rate" shall mean, with respect to any Interest
Period for a Loan, the rate per annum at which Dollar deposits
are offered to Bank in the London interbank eurodollar currency
market on the second Business Day prior to the commencement of
such Interest Period at or about 11:00 A.M. (London time) (for
delivery on the first day of such Interest Period) for a term
comparable to such Interest Period and in an amount approximately
equal to the amount of such Loan (or the overdue amount, in the
case of Interest Periods determined by Bank pursuant to Section
2.06(c)).
"Lien" shall mean, with respect to any property, any
security interest, mortgage, pledge, lien, claim, charge or other
encumbrance in, of, or on such property or the income therefrom,
including, without limitation, the interest of a vendor or lessor
under a conditional sale agreement, Capital Lease or other title
retention agreement, or any agreement to provide any of the
foregoing, and the filing of any financing statement or similar
instrument under the Uniform Commercial Code or comparable law of
any jurisdiction.
"Loan" shall have the meaning specified in Section
2.01(a).
"Loan Maturity Date" shall mean the date specified in
Section 2.01(a), as such date may be extended in accordance with
Section 2.12.
"Loan Note" shall have the meaning given to that term
in Section 2.07(a).
"Margin Stock" shall have the meaning given to that
term in Regulation U issued by the Federal Reserve Board, as
amended from time to time, and any successor regulation thereto.
"Market Value" shall mean with respect to the
Investment Collateral, at any time of determination thereof, the
daily closing prices for such date, excluding any trades which
are not bona fide arm's-length transactions. The closing price
for each such trading day shall be (i) if the Investment
Collateral is then listed or admitted for trading on any national
securities exchange or, if not so listed or admitted for trading,
is listed or admitted for trading on the National Association of
Securities Dealers, Inc. Automated Quotation System ("NASDAQ")
National Market System, the last sale price of the Investment
Collateral, regular way, or the mean of the bid and asked prices
thereof (for any trading day on which no such sale occurred), in
each case as officially reported on the principal securities
exchange on which the Investment Collateral is listed or admitted
for trading or on the NASDAQ National Market System, as the case
may be, or (ii) if not so listed or admitted for trading on a
national securities exchange or the NASDAQ National Market
System, the mean between the closing high bid and low asked
quotations for the Investment Collateral in the over-the-counter
market as reported by NASDAQ, or any similar system for the
automated dissemination of securities prices then in common use,
if so quoted, as reported by any member firm of the New York
Stock Exchange selected by Borrower. If the Investment
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Collateral is quoted on a national securities or central market
system in lieu of a market or quotation system described above,
the closing price shall be determined in the manner set forth in
clause (i) of the preceding sentence if actual transactions are
reported, and in the manner set forth in clause (ii) of the
preceding sentence if bid and asked quotations are reported but
actual transactions are not. If there is no exchange or
over-the-counter market for the Investment Collateral during the
date as of which Market Value is to be determined, the Market
Value shall be deemed to be zero.
"Material Adverse Effect" shall mean a material adverse
effect on (a) the business, assets, operations or financial or
other condition of Borrower; (b) the ability of Borrower to pay
or perform the Obligations in accordance with the terms of this
Agreement and the other Credit Documents; or (c) the rights and
remedies of Bank under this Agreement, the other Credit Documents
or any related document, instrument or agreement.
"Maturity" shall mean, with respect to any Loan,
interest, fees or other amount payable by Borrower under this
Agreement or the other Credit Documents, the date such Loan,
interest, fee or other amount becomes due, whether upon the
stated maturity or due date, upon acceleration or otherwise.
"Moody's" shall mean Moody's Investors Service, Inc.
"Note" shall mean a Loan Note.
"Notice of Borrowing" shall have the meaning given to
that term in Section 2.01(b).
"Notice of Interest Period Selection" shall have the
meaning given to that term in Section 2.01(d).
"Obligations" shall mean and include all loans,
advances, debts, liabilities, and obligations, howsoever
arising, owed by Borrower to Bank of every kind and description
(whether or not evidenced by any note or instrument and whether
or not for the payment of money), direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter
arising pursuant to the terms of this Agreement or any of the
other Credit Documents, including without limitation all
interest, fees, charges, expenses, attorneys' fees and
accountants' fees chargeable to Borrower or payable by Borrower
hereunder or thereunder.
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"Other Credit Facility" shall mean the Amended and
Restated Credit Agreement dated as of November 30, 1993 among
Avatar Finance, Inc., as borrower; Holdings and Borrower, as
guarantors; Bank and Sun Bank/Miami, National Association, as
lenders; and Bank, acting as agent for such lenders (the
"Restated Credit Agreement"), all other Loan Documents (as such
term is defined in the Restated Credit Agreement) and all
documents, financing statements, instruments and agreements
executed and delivered in connection therewith.
"Participant" shall have the meaning given to that term
in Section 7.05(b).
"Person" shall mean and include an individual, a
partnership, a corporation (including a business trust), a joint
stock company, an unincorporated association, a joint venture or
other entity or a Governmental Authority.
"Pledge Agreement" shall have the meaning given to that
term in Section 2.13(a).
"Requirement of Law" applicable to any Person shall
mean (a) the Articles or Certificate of Incorporation and
By-laws, Partnership Agreement or other organizational or
governing documents of such Person, (b) any material Governmental
Rule applicable to such Person, (c) any material license, permit,
approval or other authorization granted by any Governmental
Authority to or for the benefit of such Person and (d) any
material judgment, decision or determination of any Governmental
Authority or arbitrator, in each case applicable to or binding
upon such Person or any of its property or to which such Person
or any of its property is subject.
"Revolver Extension Request" shall have the meaning
given to that term in Section 2.12.
"S&P" shall mean Standard & Poor's Corporation.
"Solvent" shall mean, with respect to any Person on any
date, that on such date (a) the fair value of the property of
such Person is greater than the fair value of the liabilities
(including, without limitation, contingent liabilities) of such
Person, (b) the present fair saleable value of the assets of such
Person is not less than the amount that will be required to pay
the probable liability of such Person on its debts as they become
absolute and matured, (c) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond
such Person's ability to pay as such debts and liabilities mature
and (d) such Person is not engaged in business or a transaction,
and is not about to be engaged in any business or a transaction,
for which such Person's property would constitute unreasonably
small capital.
"Subsidiary" of any Person shall mean (a) any
corporation of which more than 50% of the issued and outstanding
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Equity Securities having ordinary voting power to elect a
majority of the Board of Directors of such corporation
(irrespective of whether at the time capital stock of any other
class or classes of such corporation shall or might have voting
power upon the occurrence of any contingency) is at the time
directly or indirectly owned or controlled by such Person, by
such Person and one or more of its other Subsidiaries or by one
or more of such Person's other Subsidiaries, (b) any partnership,
joint venture, or other association of which more than 50% of the
equity interest having the power to vote, direct or control the
management of such partnership, joint venture or other
association is at the time owned and controlled by such Person,
by such Person and one or more of the other Subsidiaries or by
one or more of such Person's other subsidiaries and (c) any other
Person included in the Financial Statements of such Person on a
consolidated basis.
"Taxes" shall have the meaning given to such term in
Section 2.10.
"Upfront Fee" shall have the meaning given to that term
in Section 2.04.
1.02. GAAP. Unless otherwise indicated in this Agreement
or any other Credit Document, all accounting terms used in this
Agreement or any other Credit Document shall be construed, and
all accounting and financial computations hereunder or thereunder
shall be computed, in accordance with GAAP.
1.03. Headings. Headings in this Agreement and each of the
other Credit Documents are for convenience of reference only and
are not part of the substance hereof or thereof.
1.04. Plural Terms. All terms defined in this Agreement or
any other Credit Document in the singular form shall have
comparable meanings when used in the plural form and vice versa.
1.05. Time. All references in this Agreement and each of
the other Credit Documents to a time of day shall mean New York
City time, unless otherwise indicated.
1.06. Calculation of Interest and Fees. All calculations
of interest and fees under this Agreement and the other Credit
Documents for any period shall include the first day of such
period and exclude the last day of such period.
1.07. Other Interpretive Provisions. References in this
Agreement to "Recitals," "Sections," "Exhibits" and "Schedules"
are to recitals, sections, paragraphs, subparagraphs, exhibits
and schedules herein and hereto unless otherwise indicated.
References in this Agreement and each of the other Credit
Documents to any document, instrument or agreement (a) shall
include all exhibits, schedules and other attachments thereto,
(b) shall include all documents, instruments or agreements issued
or executed in replacement thereof, and (c) shall mean such
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document, instrument or agreement, or replacement or predecessor
thereto, as amended, modified and supplemented from time to time
and in effect at any given time. The words "hereof," "herein"
and "hereunder" and words of similar import when used in this
Agreement or any other Credit Document shall refer to this
Agreement or such other Credit Document, as the case may be, as a
whole and not to any particular provision of this Agreement or
such other Credit Document, as the case may be. The words
"include" and "including" and words of similar import when used
in this Agreement or any other Credit Document shall not be
construed to be limiting or exclusive.
SECTION II. CREDIT FACILITY.
2.01. Revolving Loan Facility.
(a) Revolving Loan Availability. Subject to the terms and
conditions of this Agreement, Bank agrees to advance to Borrower
from time to time during the period beginning on the Closing Date
and ending on November 29, 1994 (the "Loan Maturity Date") such
loans as Borrower may request under this Section 2.01
(individually, a "Loan"); provided, however, that the aggregate
principal amount of all Loans outstanding at any time shall not
exceed the lesser of (i) the amount of the Commitment or (ii) the
Borrowing Base. Except as otherwise provided herein, Borrower
may borrow, repay and reborrow Loans until the Loan Maturity
Date.
(b) Notice of Borrowing. Borrower shall request each Loan
by delivering to Bank an irrevocable written notice in the form
of Exhibit A, appropriately completed (a "Notice of Borrowing"),
which specifies, among other things:
(i) The principal amount of the requested Loan, which
shall be in the minimum amount of $1,000,000 or an integral
multiple of $10,000 in excess thereof;
(ii) The date on which Bank is requested to make the
Loan, which shall be a Business Day; and
(iii) The initial Interest Period selected by Borrower
for such Loan in accordance with Section 2.01(d).
Borrower shall give each Notice of Borrowing to Bank at least
three (3) Business Days before the date of the requested Loan.
Each Notice of Borrowing shall be delivered by first-class mail
or telecopy to Bank at the office or telecopy number and during
the hours specified in Section 7.01; provided, however, that
Borrower shall promptly deliver to Bank the original of any
Notice of Borrowing initially delivered by telecopy.
(c) Loan Interest Rates. Except as otherwise specified in
Section 2.06(c) or Section 2.09(a) or (b), Borrower shall pay
interest on the unpaid principal amount of each Loan from the
date of such Loan until the maturity thereof, at a rate per annum
equal at all times during each Interest Period for such Loan to
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the LIBOR Rate for such Interest Period plus one and one-half
percent (1.5%). All computations of interest on Loans shall be
based on a year of 360 days for actual days elapsed.
(d) Loan Interest Periods.
(i) The initial and each subsequent Interest Period
selected by Borrower for a Loan shall be one, three or six
months; provided, however, that (A) any Interest Period
which would otherwise end on a day which is not a Business
Day shall be extended to the next succeeding Business Day
unless such next Business Day falls in another calendar
month, in which case such Interest Period shall end on the
immediately preceding Business Day; (B) any Interest Period
for a Loan which begins on the last Business Day of a
calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the
end of such Interest Period) shall end on the last Business
Day of a calendar month; and (C) no such Interest Period
shall end after the Loan Maturity Date.
(ii) Borrower shall notify Bank by an irrevocable
written notice at least three (3) Business Days prior to
the last day of each Interest Period for a Loan of the
Interest Period selected by Borrower for the next
succeeding Interest Period for such Loan. Such notice (a
"Notice of Interest Period Selection") shall be given by
first-class mail or telecopy to the office or the telecopy
number and during the hours specified in Section 7.01;
provided, however, that Borrower shall promptly deliver to
Bank the original of any Notice of Interest Period
Selection initially delivered by telecopy. If Borrower
fails to notify Bank of the next Interest Period for a Loan
in accordance with this Section 2.01(d), such Loan shall
automatically convert to a Loan for an Interest Period of
one (1) month on the last day of the current Interest
Period therefor, unless the relevant Loan is paid in full
on the last day of the then applicable Interest Period.
(e) Scheduled Loan Payments. Unless sooner repaid,
Borrower shall repay to Bank on the Loan Maturity Date the unpaid
principal amount of each Loan made by Bank. Borrower shall pay
accrued interest on the unpaid principal amount of each Loan on
the last day of each Interest Period therefor (and, if any such
Interest Period is longer than three (3) months, every three (3)
months), and in the case of all Loans, upon prepayment (to the
extent thereof) and at maturity.
(f) Purpose. Borrower shall use the proceeds of the Loans
to finance a portion of Borrower's Investment Collateral and for
Borrower's general corporate needs.
2.02. Commitment. The aggregate principal amount of all
Loans outstanding at any time shall not exceed Thirty Million
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Dollars ($30,000,000) (such amount to be referred to herein as
the "Commitment").
2.03. Commitment Fee. Borrower shall pay to Bank a
commitment fee (the "Commitment Fee") of one-eighth of one
percent (0.125%) per annum on the Available Commitment for the
period beginning on the Closing Date and ending on the Loan
Maturity Date. Borrower shall pay the Commitment Fee quarterly
in arrears on the first Business Day of February, May, August and
November in each year (commencing February 1, 1994) and on the
Loan Maturity Date. All computations of the Commitment Fee shall
be based on a year of 360 days for actual days elapsed.
2.04. Upfront Fee. Borrower shall pay to Bank an upfront
fee (the "Upfront Fee") of $112,500, payable on January 2, 1994.
2.05. Prepayments.
(a) Terms of all Prepayments. Upon the prepayment of any
Loan (whether such prepayment is an optional prepayment under
Section 2.05(b), a mandatory prepayment required by Section
2.05(c) or a mandatory prepayment required by any other provision
of this Agreement or the other Credit Documents, including,
without limitation, a prepayment upon acceleration), Borrower
shall pay to Bank (i) all accrued interest to the date of such
prepayment on the amount prepaid, and (ii) all amounts payable to
Bank pursuant to Section 2.11.
(b) Optional Prepayments. At its option, Borrower may,
upon three (3) Business Days notice to Bank, prepay the Loans in
part, in an aggregate principal amount of $100,000 or any greater
integral multiple of $10,000 in excess thereof, or in whole.
(c) Mandatory Payments. Borrower covenants and agrees that
if at any time the then unpaid aggregate principal balance of all
of the Loans shall be in excess of the Borrowing Base, the
Borrower shall, within five (5) Business Days, pay over to Bank
as and for a prepayment on the Loans, such amount as shall be
necessary to cause the aggregate unpaid principal balance of all
of the Loans to be equal to or less than the Borrowing Base,
without regard to the limitations set forth in Section 2.05(b).
Each mandatory prepayment shall be accompanied by accrued
interest on the amount prepaid to the date of prepayment.
(d) Effect of Prepayment. Any amount prepaid may, subject
to the terms and conditions hereof, be borrowed, repaid and
borrowed again at the option of Borrower, subject to all the
terms and conditions hereof.
(e) Application of Prepayments. All prepayments hereunder
shall be applied first to unpaid fees, costs and expenses then
due and payable under this Agreement or the other Credit
Documents, second to accrued interest then due and payable under
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this Agreement or the other Credit Documents and finally to
reduce the principal amount of outstanding Loans.
(f) No Prepayment Penalties. All payments pursuant to this
Section 2.05 shall be without premium or penalty.
2.06. Other Payment Terms.
(a) Place and Manner. Borrower shall make all payments due
to Bank hereunder in lawful money of the United States and in
same day or immediately available funds without setoff or
counterclaim not later than 12:00 noon on the date due to the
account of Bank (Account No. 802-301-4646) at the Bank of New
York, One Wall Street, New York, New York (ABA No. 0210078) or
to such other place as Bank may have theretofore designated by
notice to Borrower.
(b) Payment Date Adjustments. Whenever any payment due
hereunder shall fall due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, and
such extension of time shall be included in the computation of
interest or fees, as the case may be.
(c) Late Payments. If any amounts required to be paid by
Borrower under this Agreement or the other Credit Documents
(including, without limitation, principal or interest payable on
any Loan, any fees or other amounts) remain unpaid after such
amounts are due, Borrower shall pay interest on the aggregate,
outstanding balance of such amounts from the date due until those
amounts are paid in full at a per annum rate equal at all times
to the sum of three and one-half percent (3.5%) and the LIBOR
Rate for Interest Periods of one day, one week, one month or
three months (as the Bank shall elect in its sole discretion).
All computations of such interest shall be based on a year of 360
days for actual days elapsed. Interest accruing pursuant to this
Section 2.06 shall be payable from time to time on demand of
Bank.
2.07. Notes and Interest Account.
(a) Loan Note. The obligation of Borrower to repay the
Loans and to pay interest thereon at the rates provided herein
shall be evidenced by a promissory note in the form of Exhibit B
(individually, a "Loan Note") which note shall be (i) in the
amount of the Commitment, (ii) dated the Closing Date and (iii)
otherwise appropriately completed. Borrower authorizes Bank to
record on the schedule annexed to the Loan Note the date and
amount of each Loan and of each payment or prepayment of
principal thereon made by Borrower, and agrees that all such
notations shall constitute prima facie evidence of the matters
noted. Borrower further authorizes Bank to attach to and make a
part of the Loan Note continuations of the schedule attached
thereto as necessary.
(b) Interest Account. Borrower authorizes Bank to record
in an account or accounts maintained by Bank on its books (the
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"Interest Account") (i) the interest rates applicable to all
Loans and the effective dates of all changes thereto, (ii) the
Interest Period for each Loan, (iii) the date and amount of each
principal and interest payment on each Loan and (iv) such other
information as Bank may determine is necessary for the
computation of interest payable by Borrower hereunder.
2.08 Loan Funding. Unless otherwise directed by Borrower,
Bank shall disburse the proceeds of each Loan to Borrower by
disbursement to the account or accounts specified in the
applicable Notice of Borrowing.
2.09. Change of Circumstances.
(a) Inability to Determine Rates. If, on or before the
first day of any Interest Period for any Loan, Bank shall advise
Borrower that the LIBOR Rate for such Interest Period cannot be
adequately and reasonably determined due to the unavailability of
funds in or other circumstances affecting the London interbank
market, then after the giving of any such notice and until Bank
shall otherwise notify Borrower that the circumstances giving
rise to such condition no longer exist, Borrower's right to
request the making of and Bank's obligations to make Loans shall
be suspended. Any Loans affected by such condition outstanding
at the commencement of any such suspension shall bear interest
from the commencement of the next succeeding Interest Period for
each such Loan at the Base Rate until such suspension has ended.
(b) Illegality. If, after the date of this Agreement, the
adoption of any Governmental Rule, any change in any Governmental
Rule or the application or requirements thereof (whether such
change occurs in accordance with the terms of such Governmental
Rule as enacted, as a result of amendment or otherwise), any
change in the interpretation or administration of any
Governmental Rule by any Governmental Authority, or compliance by
Bank with any request or directive (whether or not having the
force of law) of any Governmental Authority (a "Change of Law")
shall make it unlawful or impossible for Bank to make or maintain
any Loan that bears interest based upon LIBOR, Bank shall
immediately notify Borrower of such Change of Law. Upon receipt
of such notice, (i) Borrower's right to request the making of and
Bank's obligations to make any Loans that bear interest based
upon LIBOR shall be terminated, and (ii) if Bank shall notify
Borrower that Bank may not lawfully continue to fund and maintain
the Loans outstanding with interest based upon LIBOR such Loans
shall immediately be converted into Loans bearing interest at the
Base Rate, but otherwise upon the same terms and conditions
specified herein; and (iii) thereafter so long as such Change of
Law remains applicable, Borrower may borrow Loans bearing
interest at the Base Rate upon the terms and conditions specified
herein. Any prepayment of Loans made pursuant to the preceding
sentence prior to the last day of an Interest Period for such
Loans shall be deemed a prepayment thereof for purposes of
Section 2.11.
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(c) Increased Costs. If, after the date of this Agreement,
any Change of Law:
(i) Shall subject Bank to any tax, duty or other
charge with respect to any Loan or the Commitment, or shall
change the basis of taxation of payments by Borrower to
Bank on such Loan or the Commitment or in respect to such
Loan or the Commitment (except for changes in the rate of
taxation on the overall net income of Bank); or
(ii) Shall impose, modify or hold applicable any
reserve, special deposit or similar requirement against
assets held by, deposits or other liabilities in or for the
account of, advances or loans by, or any other acquisition
of funds by Bank for any Loan; or
(iii) Shall impose on Bank any other condition related
to any Loan or the Commitment;
And the effect of any of the foregoing is to increase the cost to
Bank of making, renewing, or maintaining any such Loan or the
Commitment or to reduce any amount receivable by Bank hereunder;
then Borrower shall from time to time, upon demand by Bank, pay
to Bank additional amounts sufficient to reimburse Bank for such
increased costs or to compensate Bank for such reduced amounts.
A certificate as to the amount of such increased costs or reduced
amounts, submitted by Bank to Borrower shall, in the absence of
manifest error, be conclusive and binding on Borrower for all
purposes.
(d) Capital Requirements. If, after the date of this
Agreement, Bank determines that (i) any Change of Law affects the
amount of capital required or expected to be maintained by Bank
or any Person controlling Bank (a "Capital Adequacy Requirement")
and (ii) the amount of capital maintained by Bank or such Person
which is attributable to or based upon the Loans, the Commitment
or this Agreement must be increased as a result of such Capital
Adequacy Requirement (taking into account Bank's or such Person's
policies with respect to capital adequacy), Borrower shall pay to
Bank or such Person, upon demand of Bank, such amounts as Bank or
such Person shall determine are necessary to compensate Bank or
such Person for the increased costs to Bank or such Person of
such increased capital. A certificate of Bank setting forth in
reasonable detail the computation of any such increased costs,
delivered by Bank to Borrower shall, in the absence of manifest
error, be conclusive and binding on Borrower for all purposes.
2.10. Taxes on Payments.
(a) All payments made by Borrower under this Agreement and
the other Credit Documents shall be made free and clear of, and
without deduction or withholding for or on account of, any
present or future income, stamp or other taxes, levies, imposts,
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duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority (except net income taxes and franchise
taxes in lieu of net income taxes imposed on Bank as a result of
a present or former connection between the jurisdiction of the
Governmental Authority imposing such tax and Bank, excluding a
connection arising solely from Bank having executed, delivered or
performed its obligations or received a payment under, or
enforced, this Agreement or the other Credit Documents) (all such
non-excluded taxes, levies, imposts, duties, charges, fees,
deductions and withholdings being hereinafter called "Taxes").
If any Taxes are required to be withheld from any amounts payable
to Bank hereunder or under the other Credit Documents, the
amounts so payable to Bank shall be increased to the extent
necessary to yield to Bank (after payment of all Taxes) interest
or any such other amounts payable hereunder at the rates or in
the amounts specified in this Agreement and the other Credit
Documents. Whenever any Taxes are payable by Borrower, as
promptly as possible thereafter, Borrower shall send to Bank a
certified copy of an original official receipt received by
Borrower showing payment thereof. If Borrower fails to pay any
Taxes when due to the appropriate taxing authority or fails to
remit to Bank the required receipts or other required documentary
evidence, Borrower shall indemnify Bank for any incremental
taxes, interest or penalties that may become payable by Bank as a
result of any such failure. The agreements in this Section 2.10
shall survive the termination of this Agreement.
(b) Bank agrees that it will deliver to the Borrower (i)
two duly completed copies of United States Internal Revenue
Service Form 1001 or 4224 or successor applicable forms, as the
case may be, and (ii) an Internal Revenue Service Form W-8 or W-9
or successor applicable forms, as the case may be. Bank also
agrees to deliver to the Borrower two further copies of the said
Form 1001 and 4224 and Form W-8 or W-9, or successor applicable
forms or other manner of certification, as the case may be, (i)
upon notification by the Borrower on or before the date that any
such form expires or becomes obsolete or (ii) after the
occurrence of any event requiring a change in the most recent
form previously delivered by the Bank to the Borrower, and such
extensions or renewals thereof as may reasonably be requested by
the Borrower, unless in any such case a change in law (including,
without limitation, any change in treaty, statute, regulation or
any official interpretation thereof) has occurred after the date
of this Agreement and prior to the date on which any such
delivery would otherwise be required which renders all such forms
inapplicable or which would prevent the Bank from duly completing
and delivering any such form with respect to it and the Bank so
advised the Borrower. The Bank shall certify (i) in the case of
a Form 1001 or 4224, or successor applicable form, that it is
entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income
taxes (or, to the extent required by any change in treaty,
statute, regulation or any official interpretation thereof,
certifying the extent to which it is entitled to receive payments
under this Agreement without deduction or withholding of any
United States federal income taxes) and (ii) in the case of a
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Form W-8 or W-9, or successor applicable form, that it is
entitled to a full exemption from United States backup
withholding tax.
2.11. Funding Loss Indemnification. If Borrower shall (a)
repay or prepay any Loan on any day other than the last day of an
Interest Period therefor (whether an optional prepayment, a
mandatory prepayment, a payment upon acceleration or otherwise)
or (b) fail to borrow any Loan for which a Notice of Borrowing
has been delivered to Bank (whether as a result of the failure to
satisfy any applicable conditions or otherwise) Borrower shall,
upon demand by Bank, reimburse Bank and hold Bank harmless for
all costs and losses incurred by Bank as a result of such
repayment, prepayment or failure. Borrower understands that such
costs and losses may include, without limitation, losses incurred
by Bank as a result of funding and other contracts entered into
by Bank to fund a Loan. Bank shall deliver to Borrower a
certificate setting forth the amount of costs and losses for
which demand is made. Such a certificate so delivered to
Borrower shall, in the absence of manifest error, be conclusive
and binding on Borrower as to the amount of such loss for all
purposes.
2.12. Renewal or Termination of Commitment. Bank's
Commitment shall be effective until the Loan Maturity Date, at
which time it shall expire. Not later than 60 days prior to the
Loan Maturity Date, Borrower may notify Bank in writing that it
requests extension of the Commitment for an additional period of
364 days (or, if the last of such period is not a Business Day,
such period ending on the next preceding Business Day). Such
written notice (a "Revolver Extension Request") shall be made in
the form of Exhibit C hereto. Bank shall have the sole and
absolute discretion to agree to or decline any such Revolver
Extension Request. If Bank so agrees to the Revolver Extension
Request, Bank shall so notify Borrower in writing not later than
the date which is 30 days prior to the Loan Maturity Date, and i)
Bank's Commitment shall be so extended for such additional period
and (ii) the Loan Maturity Date shall be extended to the last day
of such period. Failure by Bank to respond timely to any such
Revolver Extension Request in writing shall be deemed to be a
rejection by the Bank of such Revolver Extension Request.
2.13. Pledge Agreement; Further Assurances.
(a) Pledge Agreement. The Obligations shall be secured by
a pledge agreement in the form of Exhibit D (the "Pledge
Agreement") of Borrower.
(b) Further Assurances. Borrower shall deliver to Bank the
Pledge Agreement and such other instruments, agreements,
certificates, opinions and documents as Bank may reasonably
request to evidence and maintain the Pledge Agreement and the
rights of Bank thereunder. Borrower shall fully cooperate with
Bank and perform all additional acts reasonably requested by Bank
to effect the purposes of the foregoing.
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SECTION III. CONDITIONS PRECEDENT.
3.01. Conditions to Initial Loan. The obligation of Bank
to make the initial Loan is subject to receipt by Bank, on or
prior to the Closing Date, of each of the following items, each
in form and substance satisfactory to Bank:
(a) Principal Credit Documents.
(1) The Credit Agreement, duly executed by Borrower;
(2) The Loan Note payable to Bank, duly executed by
Borrower; and
(3) The Pledge Agreement, duly executed by Borrower.
(b) Corporate Documents.
(1) The Certificate of Incorporation of Borrower
certified as of a recent date prior to the Closing Date by the
Secretary of State of Florida;
(2) A Certificate of Good Standing for Borrower
certified as of a recent date prior to the Closing Date by the
Secretary of State of Florida;
(3) A certificate of the Secretary of Borrower, dated
the Closing Date, certifying (a) that the Certificate of
Incorporation of Borrower, in the form certified by the Secretary
of State of Florida and delivered to Bank pursuant to item B(1)
hereof, is in full force and effect and has not been amended,
supplemented, revoked or repealed since the date of such
certification; (b) that attached thereto is a true and correct
copy of the Bylaws of Borrower as in effect on the Closing Date;
(c) that attached thereto are true and correct copies of
resolutions duly adopted by the Board of Directors of Borrower
and continuing in effect, which authorize the execution, delivery
and performance by Borrower of this Agreement and the other
Credit Documents executed or to be executed by Borrower and the
consummation of the transactions contemplated hereby and thereby;
and (d) that there are no proceedings for the dissolution or
liquidation of Borrower (commenced or threatened); and
(4) A certificate of the Secretary of Borrower, dated
the Closing Date, certifying the incumbency, signatures and
authority of the officers of Borrower authorized to execute,
deliver and perform this Agreement and the other applicable
Credit Documents on behalf of Borrower.
(c) Opinion. A written opinion of Weil, Gotshal & Manges
and/or Dennis Getman, Esq., counsel for Borrower, dated the
Closing Date and addressed to Bank, in the form of Exhibit E.
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(d) Perfection.
(1) An acknowledgement and undertaking from each of
the brokers with whom the Investment Collateral-Accounts are
maintained, in form and substance satisfactory to Lender, and
duly prepared and executed UCC-1 financing statements suitable
for filing with the relevant jurisdictions; and
(2) Such other evidence as Bank may reasonably request
to establish the accuracy and completeness of the representations
and warranties and the compliance with the terms and conditions
contained in this Agreement and the other Credit Documents.
3.02. Conditions to Each Loan . The occurrence of each
Credit Event, including the making of the initial Revolving Loan,
is subject to the further conditions that Bank shall have
received the appropriate notice requesting such Credit Event in
accordance with this Agreement and that on the date such Credit
Event is to occur and after giving effect to such Credit Event,
the following shall be true and correct:
(a) The representations and warranties set forth in Section
4.01 are true and correct in all material respects as if made on
such date, except that any representation or warranty made on, or
as of, any particular date need be true and correct only as of
such date;
(b) No Default or Event of Default has occurred and is
continuing;
(c) each of the Credit Documents remains in full force and
effect; and
(d) the aggregate amount of Loans outstanding hereunder,
after giving effect to such Loan, shall not exceed the Borrowing
Base as then determined and computed, and such Loan shall not
otherwise violate Regulation U or Regulation X.
The submission by Borrower to Bank of each Notice of Borrowing
and each Notice of Interest Period Selection shall be deemed to
be a representation and warranty by Borrower as of the date
thereof as to Sections 3.02(a), (b), (c) and (d) above.
SECTION IV. REPRESENTATIONS AND WARRANTIES.
To induce Bank to enter into this Agreement and to make
Loans hereunder, Borrower represents and warrants to Bank that:
4.01 Due Incorporation, Qualification, etc. Each of
Borrower and Borrower's material Subsidiaries (i) is a
corporation duly organized, validly existing and in good standing
under the laws of its state of incorporation; (ii) has the power
and authority to own, lease and operate its properties and carry
on its business as now conducted; and (iii) is duly qualified,
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licensed to do business and in good standing as a foreign
corporation in each jurisdiction where the failure to be so
qualified or licensed has a Material Adverse Effect.
4.02 Authority. The execution, delivery and performance by
Borrower of each Credit Document to be executed by Borrower and
the consummation of the transactions contemplated thereby (i)
are within the corporate power of Borrower and (ii) have been
duly authorized by all necessary actions on the part of Borrower.
4.03 Enforceability. Each Credit Document executed, or to
be executed, by Borrower has been, or will be, duly executed and
delivered by Borrower and constitutes, or will constitute, a
legal, valid and binding obligation of Borrower, enforceable
against Borrower in accordance with its terms, subject to
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally, and subject, as to enforceability,
to general principles of equity, including principles of
commercial reasonableness, good faith and fair dealing
(regardless of whether enforcement is sought in a proceeding at
law or in equity).
4.04 Non-Contravention. The execution and delivery by
Borrower of the Credit Documents executed by Borrower and the
performance and consummation of the transactions contemplated
thereby do not (i) violate any Requirement of Law applicable to
Borrower; (ii) violate any provision of, or result in the breach
or the acceleration of, or entitle any other Person to accelerate
(whether after the giving of notice or lapse of time or both),
any material Contractual Obligation of Borrower; or (iii) result
in the creation or imposition of any material Lien upon any
property, asset or revenue of Borrower (except such Liens as may
be created in favor of Bank pursuant to this Agreement or the
other Credit Documents).
4.05 Approvals. No consent, approval, order or
authorization of, or registration, declaration or filing with,
any Governmental Authority or other Person (including, without
limitation, the shareholders of any Person) is required in
connection with the execution and delivery of the Credit
Documents executed by Borrower and the performance and
consummation of the transactions contemplated thereby other than
those which will have been obtained at or prior to the Closing
Date.
4.06 No Violation or Default. None of Borrower or
Borrower's Subsidiaries is in violation of or in default with
respect to (i) any Requirement of Law applicable to such Person;
(ii) any Contractual Obligation of such Person where, in each
case, such violation or default could have a Material Adverse
Effect. Without limiting the generality of the foregoing, none
of Borrower or Borrower's Subsidiaries (A) has violated any
Environmental Laws, (B) has any liability under any Environmental
Laws or (C) has received notice or other communication of an
investigation or is under investigation by any Governmental
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Authority having authority to enforce Environmental Laws, where
such violation, liability or investigation could have a Material
Adverse Effect. No Event of Default or Default has occurred and
is continuing.
4.07 Litigation. No actions (including, without limitation,
derivative actions), suits, proceedings or investigations are
pending or, to the knowledge of Borrower, threatened against
Borrower or Borrower's Subsidiaries at law or in equity in any
court or before any other Governmental Authority which (i) if
adversely determined would (alone or in the aggregate) have a
Material Adverse Effect, except as disclosed on Schedule 4.07 or
as disclosed on the most recent annual report on Form 10-K of
Holdings or in the most recent quarterly report on Form 10-Q of
Holdings or (ii) seek to enjoin, either directly or indirectly,
the execution, delivery or performance by Borrower of the Credit
Documents or the transactions contemplated thereby.
4.08 Title. Borrower and Borrower's Subsidiaries have good
and marketable title in fee simple absolute to, or a valid
leasehold interest in, their respective real properties and good
title to their other respective assets and properties as
reflected in the most recent Financial Statements delivered to
Bank (except those assets and properties disposed of in the
ordinary course of business or otherwise in compliance with this
Agreement since the date of such Financial Statements) and all
respective assets and properties acquired by Borrower and
Borrower's Subsidiaries since such date (except those disposed of
in the ordinary course of business or otherwise in compliance
with this Agreement), except, in each case, the failure of which
may have a Material Adverse Effect.
4.09 Financial Statements. The Financial Statements of
Borrower which have been delivered to Bank (i) are in accordance
with the books and records of Borrower, which have been
maintained in accordance with good business practice; (ii) have
been prepared in conformity with GAAP; and (iii) fairly present
the financial position of Borrower at such date. None of
Borrower or any of Borrower's Subsidiaries has any contingent
obligations, liability for taxes or other outstanding obligations
which are material in the aggregate, except as disclosed in the
unaudited Financial Statements dated December 31, 1992, furnished
by Borrower to Bank prior to the date hereof, or in the Financial
Statements delivered to Bank pursuant to Section 5.01(a)(i) or
(ii).
4.10 No Agreements to Sell Assets. As of the date hereof,
none of Borrower or Borrower's Subsidiaries has any legal
obligation, absolute or contingent, to any Person to sell the
assets of Borrower or Borrower's Subsidiaries (other than sales
in the ordinary course of business), or to effect any merger,
consolidation or other reorganization of Borrower or Borrower's
Subsidiaries or to enter into any agreement with respect thereto.
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4.11 Employee Benefit Plans. Each Employee Benefit Plan and
ERISA Plan is in substantial compliance in all material respects
with the presently applicable provisions of ERISA and the Code.
4.12 Other Regulations. Borrower is not an "investment
company," "promotor" or "principal underwriter" for, or
controlled by, an "investment company" as such terms are defined
under the Investment Company Act of 1940. The Borrower is not a
regulated entity under the Public Utility Holding Company Act of
1935, the Federal Power Act, the Interstate Commerce Act, any
state public utilities code or any federal or state statute or
regulation limiting its ability to incur Indebtedness.
4.13 Governmental Charges and Other Indebtedness. Borrower
and Borrower's Subsidiaries have filed or caused to be filed all
federal tax returns which are required to be filed by them.
Borrower and Borrower's Subsidiaries have paid, or made provision
for the payment of, all taxes and other Governmental Charges
which have or may have become due pursuant to said returns or
otherwise and all other Indebtedness, except such Governmental
Charges or Indebtedness, if any, which are being contested in
good faith and as to which adequate reserves (determined in
accordance with GAAP) have been provided or which could not have
a Material Adverse Effect if unpaid.
4.14 Margin Stock. No proceeds of any Loan will be used to
purchase or carry, directly or indirectly, any Margin Stock or to
extend credit, directly or indirectly, to any Person for the
purpose of purchasing or carrying any Margin Stock.
4.15 Solvency, Etc. Borrower is Solvent and, after the
execution and delivery of the Credit Documents and the
consummation of the transactions contemplated thereby, will be
Solvent.
4.16 Accuracy of Information Furnished. None of the Credit
Documents and none of the other certificates, statements or
information furnished to Bank by or on behalf of Borrower or
Borrower's Subsidiaries in connection with the Credit Documents
or the transactions contemplated thereby contains or will contain
any untrue statement of a material fact or omits or will omit to
state a material fact necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading.
SECTION V. COVENANTS.
5.01. Affirmative Covenants. Until the termination of this
Agreement and the satisfaction in full by Borrower of all
Obligations, Borrower will comply, and will cause compliance,
with the following affirmative covenants unless Bank shall
otherwise consent in writing:
(a) Financial Statements, Reports, etc. Borrower will
furnish to Bank the following, each in such form and such detail
as Bank shall reasonably request:
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(i) As soon as available but not later than one
hundred twenty (120) days after the close of each fiscal
year of Borrower, copies of the unaudited Financial
Statements of Borrower (including, without limitation,
consolidated Financial Statements for Borrower and its
Subsidiaries) for such year, certified by the president,
chief financial officer, or such other responsible officer
of Borrower acceptable to Bank, to present fairly the
financial condition, results of operations and other
information reflected therein and to have been prepared in
accordance with GAAP;
(ii) As soon as available but not later than sixty
(60) days after the last day of each fiscal quarter of
Borrower (other than the fourth fiscal quarter), a copy of
the Financial Statements of Borrower for such quarter and
for the fiscal year to date, certified by the president or
chief financial officer, or such other responsible officer
of Borrower acceptable to Bank, to present fairly the
financial condition, results of operations and other
information reflected therein and to have been prepared in
accordance with GAAP (subject to year-end audit
adjustments);
(iii) Contemporaneously with the quarterly and year-end
financial statements required by the foregoing clauses (i)
and (ii), a certificate of the president or chief financial
officer, or such other responsible officer of Borrower
acceptable to Bank, stating that no Event of Default and no
Default has occurred and is continuing, or, if any such
Event of Default or Default has occurred and is continuing,
a statement as to the nature thereof and what action
Borrower proposes to take with respect thereto;
(iv) Promptly after the same are filed, copies of all
regular, periodic and special reports which Borrower or
Holdings may file with the Securities and Exchange
Commission or any successor or analogous governmental
authority.
(v) As soon as possible and in no event later than
five (5) Business Days after any officer of Borrower knows
of the occurrence of any Event of Default or Default, the
statement of the president or chief financial officer or
other responsible officer of Borrower setting forth details
of such event, condition, Event of Default or Default and
the action which Borrower proposes to take with respect
thereto;
(vi) As soon as available but not later than Thursday
of each calendar week, a computation of the Borrowing Base
as of the last day of the preceding calendar week, prepared
by Borrower and certified to by the president or chief
financial officer or other responsible officer of Borrower;
and
(vii) Borrower will cause the investment manager for
each Investment Collateral-Account to furnish Bank within
five Business Days after the end of each calendar month, a
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certificate signed by an appropriate officer of such entity
as to the existence and value of the Borrower's interest in
such entity as of the date of such request.
(viii) Such other instruments, agreements, certificates,
opinions, statements, documents and information relating to
the operations or condition (financial or otherwise) of
Borrower or Borrower's Subsidiaries, and compliance by
Borrower with the terms of this Agreement and the other
Credit Documents as Bank may from time to time reasonably
request.
(b) Books and Records. Borrower and Borrower's
Subsidiaries will at all times keep proper books of record and
account in which full, true and correct entries will be made of
its transactions in accordance with GAAP.
(c) Insurance. Borrower and Borrower's Subsidiaries shall
maintain and keep in force insurance of the types and in amounts
as in effect on the date hereof, such insurance to be carried
with reputable companies with such changes in types and amounts
of such insurance coverage as are commercially reasonable.
(d) Borrowing Base Covenants. Borrower shall ensure that
at all times (i) 40% or more of the Investment Collateral is
rated B3 or above by Moody's and rated B- or above by S&P; and
(ii) not more than ten percent (10%) of the Investment Collateral
is invested in any one issuer (or an Affiliate of such issuer).
(e) Governmental Charges and Other Indebtedness. Borrower
and Borrower's Subsidiaries will promptly pay and discharge when
due all taxes and other Governmental Charges prior to the date
upon which penalties accrue thereon and all Indebtedness of
Borrower or Borrower's Subsidiaries; provided, however, that
Borrower shall not be deemed in breach of this Section 5.01(f) if
such failures to so pay and discharge do not have a Material
Adverse Effect, except such as may in good faith be contested or
disputed, or for which arrangements for deferred payment have
been made, provided that in each such case adequate reserves are
maintained in accordance with GAAP.
(f) Use of Proceeds. No part of the proceeds of any Loan
will be used, directly or indirectly, for the purpose of
purchasing or carrying any Margin Stock or for the purpose of
purchasing or carrying or trading in any securities under such
circumstances as to involve Borrower or Bank in a violation of
Regulations G, T, U or X issued by the Federal Reserve Board.
(g) Compliance with Laws, Etc. Borrower shall comply in
all material respects with all applicable material laws, rules,
regulations and orders, such compliance to include, without
limitation, obtaining and maintaining all material permits and
licenses necessary for the conduct of its business and paying
before the same become delinquent all taxes, assessments and
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governmental charges imposed upon it or upon its property except
to the extent contested in good faith.
(h) Other Credit Facility. Borrower shall punctually
perform all of its obligations under the Other Credit Facility.
5.02. Negative Covenants. Until the termination of this
Agreement and the satisfaction in full by Borrower of all
Obligations, Borrower will comply, and will cause compliance,
with the following negative covenants unless Bank shall otherwise
consent in writing:
(a) Liens. Borrower will not create, incur, assume or
permit to exist any Lien on or with respect to any Collateral,
whether now owned or hereafter acquired.
(b) Asset Dispositions. Neither Borrower nor any of its
Subsidiaries will sell, lease, transfer or otherwise dispose of
any substantial part of its assets, including, without
limitation, substantially all assets constituting the business of
a division or branch, or permit any of its Subsidiaries to do so,
provided, that the foregoing shall not be deemed to prohibit (i)
the sale by the Borrower or any of its Subsidiaries of assets
with a then book value of less than $10,000,000 in any one
transaction or any sale made in the ordinary course of business
or (ii) subject to Section 5.02(d) hereof and to the Pledge
Agreement, the purchase or sale by the Borrower of securities
constituting Collateral.
(c) Mergers, Etc. Neither Borrower nor any of its
Subsidiaries will consolidate with or merge into any other Person
or permit any other Person to merge into it, or acquire all or
substantially all of the assets of any other Person; provided,
however, any wholly-owned Subsidiary of Borrower may merge into
another wholly-owned Subsidiary of Borrower, or Borrower or any
wholly-owned Subsidiary of Borrower may merge with any other
wholly-owned Subsidiary of Borrower, or Borrower or any
Subsidiary may acquire all or substantially all of the assets of
any other Person if the purchase price of all such acquisitions
is not in excess of $10,000,000 in any 12 month period.
(d) Distributions from Investment Accounts-Collateral.
Borrower will not make or permit any distribution of any of the
Collateral (except as instructed by Bank) if, immediately
following such distribution, the aggregate principal balance of
all Loans outstanding would exceed the Borrowing Base.
SECTION VI. DEFAULT.
6.01. Events of Default. The occurrence or existence of
any one or more of the following shall constitute an "Event of
Default" hereunder:
(a) Borrower shall fail to pay when due any principal,
interest or other payment required under the terms of this
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Agreement or any of the other Credit Documents and such failure
continues unremedied for five Business Days; or
(b) Borrower shall fail to observe or perform any other
covenant, obligation, condition or agreement contained in this
Agreement or the other Credit Documents and such failure shall
continue for thirty (30) days; or
(c) Any representation, warranty, certificate, or other
statement (financial or otherwise) made or furnished by or on
behalf of Borrower to Bank in or in connection with this
Agreement or any of the other Credit Documents, or as an
inducement to Bank to enter into this Agreement, shall be false,
incorrect, incomplete or misleading in any material respect when
made or furnished; or
(d) Borrower or any of Borrower's Subsidiaries shall fail
to make any payment when due under the terms of any bond,
debenture, note or other evidence of Indebtedness to be paid by
such Person (excluding this Agreement and the other Credit
Documents but including any other evidence of Indebtedness of
Borrower or any of Borrower's Subsidiaries to Bank and except to
the extent such bond, debenture, note or other Indebtedness is
being contested in good faith) and such failure shall continue
beyond any period of grace provided with respect thereto, or
shall default in the observance or performance of any other
agreement, term or condition contained in any such bond,
debenture, note or other evidence of Indebtedness and such
default shall continue beyond any period of grace provided with
respect thereto, and the effect of such failure or default is to
cause, or permit the holder or holders thereof to cause
Indebtedness in an aggregate amount of $1,000,000 or more to
become due prior to its stated date of maturity; or
(e) Borrower or any of Borrower's Subsidiaries shall (i)
apply for or consent to the appointment of a receiver, trustee,
liquidator or custodian of itself or of all or a substantial part
of its property, (ii) be unable, or admit in writing its
inability, to pay its debts generally as they mature, (iii) make
a general assignment for the benefit of its or any of its
creditors, (iv) be dissolved or liquidated in full or in part or
(v) commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to
itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or consent to any such
relief or to the appointment of or taking possession of its
property by any official in an involuntary case or other
proceeding commenced against it; or
(f) Proceedings for the appointment of a receiver, trustee,
liquidator or custodian of Borrower or any of Borrower's
Subsidiaries or of all or a substantial part of the property
thereof, or an involuntary case or other proceedings seeking
liquidation, reorganization or other relief with respect to
Borrower or any of Borrower's Subsidiaries or the debts thereof
under any bankruptcy, insolvency or other similar law now or
hereafter in effect shall be commenced and an order for relief
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entered or such proceeding shall not be dismissed or discharged
within sixty (60) days of commencement; or
(g) A final judgment or order for the payment of money in
excess of $1,000,000 (exclusive of amounts covered by insurance)
shall be rendered against Borrower or any of Borrower's
Subsidiaries and the same shall remain undischarged for a period
of thirty (30) days during which execution shall not be
effectively stayed, or any judgment, writ, assessment, warrant of
attachment, or execution or similar process shall be issued or
levied against a substantial part of the property of Borrower or
any of Borrower's Subsidiaries and such judgment, writ, or
similar process shall not be released, stayed, vacated or
otherwise dismissed within thirty (30) days after issue or levy;
or
(h) Any Credit Document executed by Borrower shall cease to
be, or be asserted by Borrower not to be, a legal, valid and
binding obligation of Borrower enforceable in accordance with its
terms, (other than by reason of the action or inaction by Bank);
or
(i) Any "Event of Default," as such term is defined in the
Other Credit Facility, shall occur.
6.02. Remedies. Upon the occurrence or existence of any
Event of Default (other than an Event of Default referred to in
Section 6.01(e) or 6.01(f)) and at any time thereafter during the
continuance of such Event of Default, Bank may, by written notice
to Borrower, (a) terminate the Commitment and the obligation of
Bank to make Loans and/or (b) declare all outstanding Obligations
payable by Borrower hereunder to be immediately due and payable
without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived, anything
contained herein or in the Notes to the contrary notwithstanding.
Upon the occurrence or existence of any Event of Default
described in Section 6.01(e) or 6.01(f), immediately and without
notice, (1) the Commitment and the obligations of Bank to make
Loans shall automatically terminate and (2) all outstanding
Obligations payable by Borrower hereunder shall automatically
become immediately due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are hereby
expressly waived, anything contained herein or in the Notes to
the contrary notwithstanding. In addition to the foregoing
remedies, upon the occurrence or existence of any Event of
Default, Bank may exercise any right, power or remedy permitted
to it by law, either by suit in equity or by action at law, or
both.
6.03. Defaults. Upon the occurrence of any Default, the
obligation of Bank to make Loans shall be suspended until such
event is either waived by Bank or, to the extent allowed
hereunder, cured by Borrower.
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SECTION VII. MISCELLANEOUS.
7.01. Notices. Except as otherwise provided herein, all
notices, requests, demands, consents, instructions or other
communications to or upon Bank or Borrower under this Agreement
or the other Credit Documents shall be by telecopy or in writing
and telecopied, mailed, telexed or delivered to each party at
telecopier number or its address set forth below. All such
notices and communications: when sent by Federal Express or
other overnight service, shall be effective on the Business Day
following the deposit with such service; when mailed, first class
postage prepaid and addressed as aforesaid in the mails, shall be
effective upon receipt; when telexed, shall be effective upon
receipt of answerback; when delivered by hand, shall be effective
upon delivery; and when telecopied, shall be effective upon
confirmation of receipt; provided, however, that any notice
delivered to Bank under Section II shall not be effective until
received by Bank.
Bank: BERLINER HANDELS- UND FRANKFURTER BANK
55 East 59th Street
New York, New York 10022
Attn: Paul Travers, Vice President
Telephone: (212) 756-5570
Telecopier: (212) 756-5911
Borrower: AVATAR PROPERTIES INC.
255 Alhambra Circle
Coral Gables, Florida 33134
Attn: Charles McNairy
Telephone: (305) 442-7000
Telecopier: (305) 441-7876
Each Notice of Borrowing shall be given by Borrower to Bank's
office located at the address referred to above during Bank's
normal business hours; provided, however, that any such notice
received by Bank after 12:00 p.m. on any Business Day shall be
deemed received by Bank on the next Business Day. In any case
where this Agreement authorizes notices, requests, demands or
other communications by Borrower to Bank to be made by telephone
or telecopy, Bank may conclusively presume that anyone purporting
to be a person designated in the certificate received by Bank
pursuant to any such document delivered by Borrower to Bank, is
such a person.
7.02. Expenses. Borrower shall pay on demand, whether or
not any Loan is made hereunder, (a) all reasonable out-of-pocket
fees and expenses, including out-of-pocket reasonable attorneys'
fees and expenses, incurred by Bank in connection with the
preparation, execution and delivery of, and the exercise of its
duties under, this Agreement and the other Credit Documents, and
the preparation of amendments and waivers hereunder and
thereunder; and (b) all reasonable out-of-pocket fees and
expenses, including reasonable out-of-pocket attorneys' fees and
expenses, incurred by Bank in the enforcement or attempt to
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enforce any of the Obligations which is not performed as and when
required by this Agreement or the other Credit Documents.
7.03. Indemnification. To the fullest extent permitted by
law, Borrower agrees to protect, indemnify, defend and hold
harmless Bank and its respective directors, officers, employees,
agents and any affiliate thereof ("Indemnitees") from and against
any and all liabilities, losses, damages or expenses of any kind
or nature and from any and all suits, claims or demands
(including, without limitation, in respect of or for reasonable
out-of-pocket attorneys' fees and other out-of-pocket expenses)
arising on account of or in connection with any matter or thing
or action or failure to act by Indemnitees, or any of them,
arising out of or relating to the Credit Documents, including
without limitation any use by Borrower of any proceeds of the
Loans and any brokerage or custodian fees payable with respect to
the Collateral in the Investment Collateral-Accounts, except to
the extent such liability arises from the willful misconduct or
gross negligence of the Indemnities. Upon receiving knowledge of
any suit, claim or demand asserted by a third party that Bank
believes is covered by this indemnity, Bank shall give Borrower
notice of the matter and an opportunity to defend it, at
Borrower's sole cost and expense, with legal counsel reasonably
satisfactory to Bank. Any failure or delay of Bank to notify
Borrower of any such suit, claim or demand shall not relieve
Borrower of its obligations under this Section 7.03 but shall
reduce such obligations to the extent of any increase in those
obligations caused solely by an unreasonable failure or delay.
The Bank agrees that it will not settle any such matter for which
indemnification is sought hereunder without the prior written
consent of the Borrower (which shall not be unreasonably
withheld). The obligations of Borrower under this Section 7.03
shall survive the payment and performance of the Obligations.
7.04. Waivers; Amendments. Any term, covenant, agreement
or condition of this Agreement or any other Credit Document may
be amended or waived if such amendment or waiver is in writing
and is signed by Borrower and Bank. No failure or delay by Bank
in exercising any right hereunder shall operate as a waiver
thereof or of any other right nor shall any single or partial
exercise of any such right preclude any other further exercise
thereof or of any other right. Unless otherwise specified in
such waiver or consent, a waiver or consent given hereunder shall
be effective only in the specific instance and for the specific
purpose for which given.
7.05. Successors and Assigns.
(a) Binding Effect. This Agreement and the other Credit
Documents shall be binding upon and inure to the benefit of
Borrower, Bank, all future holders of the Notes and their
respective successors and permitted assigns, except that Borrower
may not assign or transfer any of its rights or obligations under
any Credit Document without the prior written consent of Bank.
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All references in this Agreement to any Person shall be deemed to
include all successors and assigns of such Person.
(b) Assignments/Participations. Bank may at any time sell,
assign, grant participations in, or otherwise transfer to any
other Person (a "Participant") all or part of the obligations of
Borrower under this Agreement with the prior written consent of
Borrower (which consent shall not be unreasonably withheld).
Borrower agrees that each such disposition that is made will give
rise to a direct obligation of Borrower to the Participant.
(c) Confidentiality. Bank agrees to keep information
obtained by it pursuant hereto confidential in accordance with
Bank's customary practices and agrees that it will only use such
information in connection with the transactions contemplated by
this Agreement and not disclose any of such information other
than (i) to Bank's employees, representatives and agents who are
or are expected to be involved in the evaluation of such
information in connection with the transactions contemplated by
this Agreement and who are advised of the confidential nature of
such information, (ii) to the extent such information presently
is or hereafter becomes available to the Bank on a
non-confidential basis from a source other than Borrower, (iii)
to the extent disclosure is required by law, regulation or
judicial order or requested or required by bank regulations or
auditors, or (iv) to assignees or participants or potential
assignees or participants who agree to be bound by the provisions
of this sentence.
7.06. Setoff.
Setoff. In addition to any rights and remedies of Bank
provided by law, Bank shall have the right, without prior notice
to Borrower, any such notice being expressly waived by Borrower
to the extent permitted by applicable law, upon the occurrence
and during the continuance of an Event of Default, to set-off and
apply against any indebtedness, whether matured or unmatured, of
Borrower to Bank, any amount owing from Bank to Borrower, at or
at any time after, the happening of any of the above mentioned
events. The aforesaid right of set-off may be exercised by Bank
against Borrower or against any trustee in bankruptcy, debtor in
possession, assignee for the benefit of creditors, receiver or
execution, judgment or attachment creditor of Borrower or against
anyone else claiming through or against Borrower or such trustee
in bankruptcy, debtor in possession, assignee for the benefit of
creditors, receiver, or execution, judgment or attachment
creditor, notwithstanding the fact that such right of set-off
shall not have been exercised by Bank prior to the occurrence of
a Default or an Event of Default. Bank agrees promptly to notify
Borrower after any such set-off and application made by Bank,
provided that the failure to give such notice shall not affect
the validity of such set-off and application.
7.07. No Third Party Rights. Nothing expressed in or to be
implied from this Agreement is intended to give, or shall be
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construed to give, any Person, other than the parties hereto and
their permitted successors and assigns hereunder, any benefit or
legal or equitable right, remedy or claim under or by virtue of
this Agreement or under or by virtue of any provision herein.
7.08. Partial Invalidity. If at any time any provision of
this Agreement is or becomes illegal, invalid or unenforceable in
any respect under the law or any jurisdiction, neither the
legality, validity or enforceability of the remaining provisions
of this Agreement nor the legality, validity or enforceability of
such provision under the law of any other jurisdiction shall in
any way be affected or impaired thereby.
7.09. Governing Law. This Agreement and each of the other
Credit Documents shall be governed by and construed in accordance
with the laws of the State of New York without reference to
conflicts of law rules.
7.10. Entire Agreement. This Agreement and each of the
other Credit Documents dated as of the date hereof, taken
together, constitute and contain the entire agreement of Borrower
and Bank and supersede any and all prior agreements,
negotiations, correspondence, understandings and communications
among the parties, whether written or oral, respecting the
subject matter hereof.
7.11. Jury Trial. EACH OF BORROWER AND BANK, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY AS TO ANY ISSUE RELATING HERETO
IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS AGREEMENT.
7.12. Counterparts. This Agreement may be executed in any
number of identical counterparts, any set of which signed by all
the parties hereto shall be deemed to constitute a complete,
executed original for all purposes.
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IN WITNESS WHEREOF, Borrower and Bank have caused this
Agreement to be executed as of the day and year first above
written.
AVATAR PROPERTIES INC.
By: /s/ Charles L. McNairy
Name: Charles L. McNairy
Title: Executive Vice President
BERLINER HANDELS- UND FRANKFURTER
BANK, GRAND CAYMAN BRANCH
By: /s/ Evan Contos
Name: Evan Contos
Title: V.P.
By: /s/ Paul Travers
Name: Paul Travers
Title: V.P.
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