EXHIBIT 10.2
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
among
CENTEX CORPORATION,
Borrower
BANK OF AMERICA, N.A.,
Administrative Agent
and
THE LENDERS NAMED HEREIN,
Lenders
$250,000,000
DATED AS OF AUGUST 7, 2003
BANK ONE, NA,
Syndication Agent
BANC OF AMERICA SECURITIES LLC,
Sole Lead Arranger and Sole Book Manager
TABLE OF CONTENTS
Page
SECTION 1 DEFINITIONS AND TERMS.............................................................. 1
1.1 DEFINITIONS................................................................ 1
1.2 NUMBER AND GENDER OF WORDS; OTHER REFERENCES............................... 15
1.3 ACCOUNTING PRINCIPLES...................................................... 15
1.4 TIME REFERENCES............................................................ 15
SECTION 2 CREDIT EXTENSION PROVISIONS........................................................ 15
2.1 LETTERS OF CREDIT.......................................................... 15
2.2 LENDERS; INCREASE IN TOTAL COMMITMENT...................................... 23
2.3 VOLUNTARY TERMINATION OR REDUCTION OF COMMITMENTS.......................... 24
SECTION 3 TERMS OF PAYMENT................................................................... 24
3.1 NOTES AND PAYMENTS......................................................... 24
3.2 MANDATORY PAYMENTS......................................................... 25
3.3 DEFAULT RATE............................................................... 25
3.4 INTEREST RECAPTURE......................................................... 25
3.5 INTEREST CALCULATIONS...................................................... 26
3.6 MAXIMUM RATE............................................................... 26
3.7 ORDER OF APPLICATION....................................................... 26
3.8 RIGHT OF SET-OFF; ADJUSTMENTS.............................................. 27
3.9 BOOKING BORROWINGS......................................................... 27
SECTION 4 CHANGE IN CIRCUMSTANCES............................................................ 28
4.1 INCREASED COST AND REDUCED RETURN.......................................... 28
4.2 LIMITATION ON TYPES OF BORROWINGS.......................................... 29
4.3 ILLEGALITY................................................................. 29
4.4 TREATMENT OF AFFECTED LOANS................................................ 29
4.5 COMPENSATION............................................................... 30
4.6 TAXES...................................................................... 30
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SECTION 5 FEES............................................................................... 32
5.1 TREATMENT OF FEES.......................................................... 32
5.2 FEES OF ADMINISTRATIVE AGENT............................................... 32
5.3 LETTER OF CREDIT FEES...................................................... 32
5.4 FRONTING FEE AND DOCUMENTARY AND PROCESSING CHARGES PAYABLE TO L/C ISSUER.. 32
5.5 UNUSED FEE................................................................. 32
SECTION 6 CONDITIONS PRECEDENT............................................................... 33
6.1 CONDITIONS PRECEDENT TO CLOSING............................................ 33
6.2 CONDITIONS TO ALL CREDIT EXTENSIONS........................................ 33
SECTION 7 REPRESENTATIONS AND WARRANTIES..................................................... 34
7.1 PURPOSE OF LETTER OF CREDIT FACILITY....................................... 34
7.2 EXISTENCE, GOOD STANDING, AUTHORITY, AND AUTHORIZATIONS.................... 35
7.3 SUBSIDIARIES; CAPITAL STOCK................................................ 35
7.4 AUTHORIZATION AND CONTRAVENTION............................................ 35
7.5 BINDING EFFECT............................................................. 35
7.6 FINANCIAL STATEMENTS....................................................... 35
7.7 LITIGATION, CLAIMS, INVESTIGATIONS......................................... 36
7.8 TAXES...................................................................... 36
7.9 ENVIRONMENTAL MATTERS...................................................... 36
7.10 EMPLOYEE BENEFIT PLANS..................................................... 36
7.11 PROPERTIES; LIENS.......................................................... 37
7.12 GOVERNMENT REGULATIONS..................................................... 37
7.13 TRANSACTIONS WITH AFFILIATES............................................... 37
7.14 NO DEFAULT................................................................. 37
7.15 SOLVENCY................................................................... 37
7.16 COMPLIANCE WITH LEGAL REQUIREMENTS......................................... 37
7.17 FULL DISCLOSURE............................................................ 37
7.18 SENIOR DEBT................................................................ 37
7.19 TAX SHELTER REGULATIONS.................................................... 37
SECTION 8 AFFIRMATIVE COVENANTS.............................................................. 38
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
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8.1 USE OF PROCEEDS............................................................ 38
8.2 BOOKS AND RECORDS.......................................................... 38
8.3 ITEMS TO BE FURNISHED...................................................... 38
8.4 INSPECTIONS................................................................ 40
8.5 TAXES...................................................................... 40
8.6 PAYMENT OF OBLIGATIONS..................................................... 40
8.7 MAINTENANCE OF EXISTENCE, ASSETS, AND BUSINESS............................. 40
8.8 INSURANCE.................................................................. 40
8.9 PRESERVATION AND PROTECTION OF RIGHTS...................................... 41
8.10 ENVIRONMENTAL LAWS......................................................... 41
8.11 COMPLIANCE WITH LEGAL REQUIREMENTS......................................... 41
8.12 DESIGNATION OF UNRESTRICTED SUBSIDIARIES................................... 41
SECTION 9 NEGATIVE COVENANTS................................................................. 42
9.1 EMPLOYEE BENEFIT PLANS..................................................... 42
9.2 LIENS...................................................................... 42
9.3 SUBSIDIARY INDEBTEDNESS; LIMITATIONS ON UPSTREAMING........................ 44
9.4 TRANSACTIONS WITH AFFILIATES............................................... 44
9.5 COMPLIANCE WITH DOCUMENTS.................................................. 44
9.6 ASSIGNMENT................................................................. 44
9.7 FISCAL YEAR AND ACCOUNTING METHODS......................................... 44
9.8 GOVERNMENT REGULATIONS..................................................... 44
9.9 SALE OF ASSETS............................................................. 44
9.10 MERGERS AND DISSOLUTIONS; SALE OF CAPITAL STOCK............................ 44
9.11 NEW BUSINESS............................................................... 45
9.12 FINANCIAL COVENANTS........................................................ 45
SECTION 10 DEFAULT........................................................................... 45
10.1 PAYMENT OF OBLIGATION...................................................... 45
10.2 COVENANTS.................................................................. 45
10.3 DEBTOR RELIEF.............................................................. 46
10.4 JUDGMENTS AND ATTACHMENTS.................................................. 46
10.5 GOVERNMENT ACTION.......................................................... 46
10.6 MISREPRESENTATION.......................................................... 46
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
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10.7 CHANGE OF CONTROL.......................................................... 46
10.8 DEFAULT UNDER OTHER DEBT AND AGREEMENTS.................................... 46
10.9 EMPLOYEE BENEFIT PLANS..................................................... 47
10.10 VALIDITY AND ENFORCEABILITY OF LOAN DOCUMENTS.............................. 47
SECTION 11 RIGHTS AND REMEDIES............................................................... 48
11.1 REMEDIES UPON DEFAULT...................................................... 48
11.2 BORROWER WAIVERS........................................................... 48
11.3 PERFORMANCE BY ADMINISTRATIVE AGENT........................................ 48
11.4 DELEGATION OF DUTIES AND RIGHTS............................................ 49
11.5 NOT IN CONTROL............................................................. 49
11.6 COURSE OF DEALING.......................................................... 49
11.7 CUMULATIVE RIGHTS.......................................................... 49
11.8 APPLICATION OF PROCEEDS.................................................... 49
11.9 CERTAIN PROCEEDINGS........................................................ 49
11.10 EXPENSES; INDEMNIFICATION.................................................. 50
SECTION 12 ADMINISTRATIVE AGENT.............................................................. 51
12.1 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT...................... 51
12.2 DELEGATION OF DUTIES....................................................... 51
12.3 LIABILITY OF ADMINISTRATIVE AGENT.......................................... 51
12.4 RELIANCE BY ADMINISTRATIVE AGENT........................................... 52
12.5 NOTICE OF EVENT OF DEFAULT................................................. 52
12.6 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE AGENT......... 52
12.7 INDEMNIFICATION OF ADMINISTRATIVE AGENT.................................... 53
12.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY............................ 53
12.9 SUCCESSOR ADMINISTRATIVE AGENT............................................. 54
12.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIMS............................. 54
12.11 OTHER AGENT; ARRANGERS; AND MANAGERS....................................... 55
SECTION 13 MISCELLANEOUS..................................................................... 55
13.1 HEADINGS................................................................... 55
13.2 NONBUSINESS DAYS........................................................... 55
13.3 COMMUNICATIONS............................................................. 55
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13.4 FORM AND NUMBER OF DOCUMENTS............................................... 56
13.5 EXCEPTIONS TO COVENANTS.................................................... 56
13.6 SURVIVAL................................................................... 56
13.7 GOVERNING LAW.............................................................. 56
13.8 INVALID PROVISIONS......................................................... 56
13.9 ENTIRETY................................................................... 57
13.10 JURISDICTION; VENUE; SERVICE OF PROCESS; JURY TRIAL........................ 57
13.11 AMENDMENTS, CONSENTS, CONFLICTS, AND WAIVERS............................... 58
13.12 MULTIPLE COUNTERPARTS...................................................... 58
13.13 SUCCESSORS AND ASSIGNS; ASSIGNMENTS AND PARTICIPATIONS..................... 59
13.14 DISCHARGE ONLY UPON PAYMENT IN FULL; REINSTATEMENT IN CERTAIN CIRCUMSTANCES 61
13.15 CONFIDENTIALITY............................................................ 61
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
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SCHEDULES AND EXHIBITS
Schedule 1.1 - Existing Letters of Credit
Schedule 2.1 - Lenders and Commitments; Addresses for Notice
Schedule 7.3 - Subsidiaries and Stock
Exhibit A - Form of Note
Exhibit B - Form of Compliance Certificate
Exhibit C - Form of Notice of Conversion/Continuation
Exhibit D - Form of Opinion of Counsel
Exhibit E - Form of Assignment and Acceptance Agreement
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
vi
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
THIS LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT is entered into as of
August 7, 2003 (the "CLOSING DATE") among CENTEX CORPORATION, a Nevada
corporation ("BORROWER"), Lenders (hereinafter defined), and BANK OF AMERICA,
N.A., as Administrative Agent (hereinafter defined).
R E C I T A L S
A. Borrower has requested that Lenders extend credit to Borrower
in the form of this Agreement, providing for, among other things, a letter of
credit facility in the aggregate principal amount of up to $250,000,000.
B. Upon and subject to the terms and subject to the conditions of
this Agreement, Lenders are willing to extend such credit to Borrower.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
SECTION 1 DEFINITIONS AND TERMS.
1.1 DEFINITIONS. As used herein:
ADJUSTED EURODOLLAR RATE means, for any Eurodollar Borrowing for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100th of 1%) determined by Administrative Agent to be equal to the
quotient obtained by dividing (a) the Eurodollar Rate for such Eurodollar
Borrowing for such Interest Period by (b) one (1) minus the Reserve Requirement
for such Eurodollar Borrowing for such Interest Period.
ADMINISTRATIVE AGENT means Bank of America, N.A., and its permitted
successors and assigns as "Administrative Agent" for Lenders under this
Agreement.
AFFILIATE of any Person means any other Person who directly or
indirectly controls, or is controlled by, or is under common control with, such
Person, and, for purposes of this definition only, "control," "controlled by,"
and "under common control with" mean possession, directly or indirectly, of the
power to direct or cause the direction of management or policies (whether
through ownership of voting securities, by contract, or otherwise).
AGENT-RELATED PERSONS means Administrative Agent, together with its
Affiliates (including Arranger), and the officers, directors, employees, agents
and attorneys-in-fact of such Persons and Affiliates.
AGREEMENT means this Letter of Credit and Reimbursement Agreement (as
the same may hereafter be amended, modified, supplemented, or restated from time
to time).
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
APPLICABLE LENDING OFFICE means, for each Lender, the "Lending Office"
of such Lender (or an Affiliate of such Lender) designated on SCHEDULE 2.1 or
such other office as such Lender may from time to time specify to Administrative
Agent and Borrower by written notice in accordance with the terms hereof as the
office by which its Credit Extensions are to be made and maintained.
APPLICABLE MARGIN means, as of any date of determination, the interest
margin over the Prime Rate or the Adjusted Eurodollar Rate, and the applicable
fees payable pursuant to SECTION 5.5 that corresponds to the Moody's Rating and
the S & P Rating set forth below on such date of determination:
Applicable Margin for
Applicable Margin Eurodollar Borrowings Applicable
Moody's for Prime Rate and Letter of Credit Margin for
Level Rating S & P Rating Borrowings Fees Unused Fees
1 A3 or higher A- or higher 0.0000% 0.6250% 0.1250%
2 Baa1 BBB+ 0.0000% 0.7750% 0.1500%
3 Baa2 BBB 0.0000% 0.9000% 0.1750%
4 Baa3 BBB- 0.0000% 1.0750% 0.2250%
5 Ba1 or lower BB+ or lower 0.2500% 1.3000% 0.3000%
or or
Not Rated Not Rated
For purposes of the foregoing: (a) if the Moody's Rating and the S & P Rating
shall fall within different LEVELS, then the Applicable Margin shall be
determined by reference to the numerically higher LEVEL (e.g., if the S & P
Rating is in LEVEL 1 and the Moody's Rating is in LEVEL 2, then the Applicable
Margin shall be determined by reference to LEVEL 2); and (b) if either Moody's
or S & P no longer publishes ratings and Borrower and Administrative Agent
cannot agree on another ratings agency to replace Moody's or S & P, as the case
may be, then the Moody's Rating or the S & P Rating, as the case may be, shall
be deemed to be "Not Rated." Each change in the Applicable Margin shall be
effective, in the case of an upgrade, immediately following Administrative
Agent's receipt of notice from Borrower, as required in SECTION 8.3(g), of a
change in the Moody's Rating or the S & P Rating, and in the case of a
downgrade, on the date of the public announcement thereof.
APPROVED FUND is defined in SECTION 13.13(g).
ARRANGER means Banc of America Securities LLC, and its successors and
permitted assigns in its capacity as "Sole Lead Arranger" under the Loan
Documents.
ATTORNEY COSTS means and includes all reasonable fees, expenses, and
disbursements of any law firm or other external counsel.
AUTHORIZATIONS means all filings, recordings, and registrations with,
and all validations or exemptions, approvals, orders, authorizations, consents,
franchises, licenses, certificates, and permits from, any Governmental
Authority.
BORROWER is defined in the preamble to this Agreement.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
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BORROWING means any Prime Rate Borrowing or Eurodollar Borrowing
pursuant to SECTION 2.1(c).
BUSINESS DAY means (a) for all purposes, any day other than Saturday,
Sunday, and any other day on which commercial banking institutions are required
or authorized by any Legal Requirement to be closed at the place of
Administrative Agent's Payment Office or payments cannot be made on the United
States Fedwire System, and (b) in addition to the foregoing, in respect of any
Eurodollar Borrowing, a day on which dealings in United States dollars are
conducted in the London interbank market and commercial banks are open for
international business in London.
CAPITALIZED LEASE OBLIGATIONS means all obligations under Capital
Leases taken at the amount thereof accounted for as liabilities in accordance
with GAAP.
CAPITAL LEASE means any capital lease or sublease which should be
capitalized on a balance sheet in accordance with GAAP.
CASH COLLATERALIZE is defined in SECTION 2.1(i).
CHANGE IN CONTROL means, with respect to any Person, any event or
series of events by which:
(a) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of such Person or its Subsidiaries, and any Person acting
in its capacity as trustee, agent or other fiduciary or administrator of any
such plan) becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Securities Exchange Act of 1934, except that a Person or group shall
be deemed to have "beneficial ownership" of all securities that such Person or
group has the right to acquire (such right, an "OPTION RIGHT"), whether such
right is exercisable immediately or only after the passage of time), directly or
indirectly, of fifty percent (50%) or more of the equity securities of such
Person entitled to vote for members of the board of directors or equivalent
governing body of such Person on a fully-diluted basis (and taking into account
all such securities that such Person or group has the right to acquire pursuant
to any option right); or
(b) during any period of twelve (12) consecutive months, a
majority of the members of the board of directors or other equivalent governing
body of such Person cease to be composed of individuals (i) who were members of
that board or equivalent governing body on the first day of such period, (ii)
whose election or nomination to that board or equivalent governing body was
approved by individuals referred to in clause (i) above constituting at the time
of such election or nomination at least a majority of that board or equivalent
governing body, or (iii) whose election or nomination to that board or other
equivalent governing body was approved by individuals referred to in clauses (i)
and (ii) above constituting at the time of such election or nomination at least
a majority of that board or equivalent governing body (excluding, in the case of
both clause (ii) and clause (iii), any individual whose initial nomination for,
or assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any Person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directors).
CLOSING DATE is defined in the preamble to this Agreement.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
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COMMITMENT means, for any Lender at any date of determination, the
amount stated beside each Lender's name as set forth on SCHEDULE 2.1 or on the
most-recently amended SCHEDULE 2.1, if any, prepared by Administrative Agent
pursuant to SECTION 2.2 or SECTION 13.13 (which amount is subject to increase,
reduction, or cancellation in accordance with this Agreement).
COMPANIES means, as of any date, Borrower and each of its Subsidiaries,
and COMPANY means any one of the Companies.
COMPLIANCE CERTIFICATE means a certificate signed by a Responsible
Officer, substantially in the form of EXHIBIT B.
CONSEQUENTIAL LOSS is defined in SECTION 4.5.
CONSOLIDATED ADJUSTED NET INCOME means, for any period of
determination, consolidated net earnings (after income taxes and without
deduction for losses) of the Companies, but excluding (a) gains from
extraordinary items for such period, and (b) any aggregate net gain during such
period arising from the sale, exchange, or other disposition of capital assets
by the Companies (including any fixed assets, whether tangible or intangible,
all inventory sold in conjunction with the disposition of fixed assets, and all
securities (other than securities sold in the ordinary course of business)).
CONSOLIDATED DEBT means, as of any date of determination, (a) all Debt
of the Restricted Companies, on a consolidated basis, minus (b) Excess Cash not
subject to any Liens or other restrictions not inherent in the particular
investment or obligation; provided that, for purposes of SECTION 8.12,
Consolidated Debt means, as of the date of determination, all Debt of the
Restricted Companies, on a consolidated basis.
CONSOLIDATED EBITDA means, for any period of determination and without
duplication, the EBITDA of the Restricted Companies, on a consolidated basis.
CONSOLIDATED INTEREST EXPENSE means, for any period of determination,
the Interest Expense of the Restricted Companies, on a consolidated basis.
CONSOLIDATED TANGIBLE NET WORTH means, as of any date of determination,
Tangible Net Worth of the Companies (other than any Excluded Subsidiary), on a
consolidated basis determined in accordance with GAAP.
CONSTITUENT DOCUMENTS means, with respect to any Person, its articles
or certificate of incorporation, bylaws, partnership agreement, organizational
documents, limited liability company agreement, trust agreement, or such other
documents as may govern such Person's formation, organization, and management.
CONTINGENT OBLIGATIONS means as to any Person any obligation of such
Person guaranteeing any Debt, leases, dividends, or other obligations ("PRIMARY
OBLIGATIONS") of any other Person (the "PRIMARY OBLIGOR") in any manner, whether
directly or indirectly, and any other obligation of such Person, whether or not
contingent, pursuant to which such Person is liable under or with respect to a
primary obligation of a primary obligor, in each case that would be included on
a balance sheet of such Person (or disclosed and assigned a monetary value in
the footnotes thereto) properly prepared in accordance with GAAP as a
"Contingent Obligation."
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
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CONTINUE, CONTINUATION, and CONTINUED refers to the continuation
pursuant to SECTION 2.1(c) of a Eurodollar Borrowing from one Interest Period to
the next Interest Period.
CONVERT, CONVERSION, and CONVERTED refers to a conversion pursuant to
SECTION 2.1(c) of one Type of Borrowing into another Type of Borrowing.
CREDIT EXTENSION means each of the following: (a) a Borrowing; and (b)
an L/C Credit Extension.
CREDIT PARTIES means Administrative Agent and Lenders, and CREDIT PARTY
means any one of the Credit Parties.
CUMULATIVE CONSOLIDATED NET INCOME means the sum of Quarterly
Consolidated Net Income for the fiscal quarter ended March 31, 2003, and for
each succeeding fiscal quarter during the term hereof.
CURRENT FINANCIALS means, at the time of any determination thereof, the
most recently delivered to the Credit Parties of either (a) the Financial
Statements for the fiscal year ended March 31, 2003, calculated on a
consolidated basis for the Companies, or (b) the Financial Statements required
to be delivered under SECTION 8.3(a) or 8.3(b), as the case may be.
DEBT means (without duplication), for any Person, the sum of the
following: (a) all liabilities, obligations, and indebtedness of such Person for
money borrowed; (b) all liabilities, obligations, and indebtedness of such
Person which is evidenced by bonds, notes, debentures, or other similar
instruments; (c) all Capitalized Lease Obligations of such Person; (d) all
obligations of such Person issued or assumed as the deferred purchase price of
property, all conditional sale obligations of such Person, and obligations of
such Person under any title retention agreement (but excluding trade accounts
payable arising in the ordinary course of business that are not past-due for
more than ninety (90) days); (e) all Contingent Obligations of such Person; (f)
all obligations of the type referred to in CLAUSES (a) and (b) preceding of
other Persons secured by any Lien on any property or asset of such Person
(whether or not such obligation is assumed by such Person); (g) the face amount
of all letters of credit and banker's acceptances issued for the account of such
Person, and without duplication, all drafts drawn and unpaid thereunder; (h) all
Stock of such Person subject to repurchase or redemption by such Person other
than at the sole option of such Person; (i) all obligations of such Person to
purchase Stock (or other property) which arise out of or in connection with the
sale by such Person of the same or substantially similar Stock (or property);
and (j) all liabilities, obligations, and indebtedness of such Person arising
under Financial Hedges entered into by such Person as determined in accordance
with GAAP.
DEBTOR RELIEF LAWS means the Bankruptcy Code of the United States of
America and all other applicable liquidation, conservatorship, bankruptcy,
moratorium, rearrangement, receivership, insolvency, reorganization, fraudulent
transfer or conveyance, suspension of payments, or similar Legal Requirements
from time to time in effect affecting the Rights of creditors generally.
DEFAULTING LENDER means, as of any date, any Lender that has (a) failed
to make a Credit Extension required to be made by it hereunder, or (b) given
notice to Administrative Agent or Borrower that it will not make, or that it has
disaffirmed or repudiated any obligation to make, any Credit Extension hereunder
(unless such notice is given by all Lenders).
DEFAULT RATE means, (i) with respect to any Borrowing, on any date, a
per annum rate of interest equal from day to day to the lesser of (a) the
non-default interest rate applicable to such Borrowing, plus two percent (2%)
and (b) the Maximum Rate, and (ii) with respect to any other Obligation under
the Loan
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
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Documents, the lesser of (a) the Prime Rate plus the then-effective Applicable
Margin for Prime Rate Borrowings, plus two percent (2%) and (b) the Maximum
Rate.
DOLLARS and the symbol $ mean lawful money of the United States of
America.
EBITDA means, with respect to any Person for any fiscal period, an
amount equal to (a) consolidated net income of such Person for such period,
minus (b) the sum of (i) income tax credits, (ii) interest income, (iii) gains
from extraordinary items for such period, and (iv) any aggregate net gain during
such period arising from the sale, exchange, or other disposition of capital
assets by such Person (including any fixed assets, whether tangible or
intangible, all inventory sold in conjunction with the disposition of fixed
assets, and all securities (other than securities sold in the ordinary course of
business)), in each case to the extent included in the calculation of
consolidated net income of such Person for such period in accordance with GAAP,
but without duplication, minus (c) any cash payments made in respect of any item
of extraordinary loss accrued during a prior period and added back to EBITDA in
such prior period pursuant to CLAUSE (d)(v) below, plus (d) the sum of (i) any
provision for income taxes, (ii) Interest Expense, (iii) the amount of
depreciation and amortization for such period, (iv) the amount of any deduction
to consolidated net income as the result of any stock option expense, (v) the
amount of any item of extraordinary loss not paid in cash in such period, and
(vi) the absolute value of any aggregate net loss during such period arising
from the sale, exchange, or other disposition of capital assets by such Person
(including any fixed assets, whether tangible or intangible, all inventory sold
in conjunction with the disposition of fixed assets, and all securities (other
than securities sold in the ordinary course of business)), in each case to the
extent included in the calculation of consolidated net income of such Person for
such period in accordance with GAAP, but without duplication.
ELIGIBLE ASSIGNEE is defined in SECTION 13.13(g).
EMPLOYEE PLAN means an employee pension benefit plan covered by Title
IV of ERISA and established or maintained by Borrower or any ERISA Affiliate,
but not including any Multiemployer Plan.
ENVIRONMENTAL LAW means any Legal Requirement relating to protection of
the public health and welfare and/or the environment, including any Legal
Requirement relating to: the generation, processing, treatment, storage,
transport, disposal, investigation, and remediation or other management of
Hazardous Materials; the storage, handling, use, and transport of chemicals and
Hazardous Materials; and protection of areas of particular environmental
concern, including wetlands, areas inhabited by endangered species, historic
sites, and areas above protected aquifers.
EQUITY ISSUANCE means the issuance or sale by any Restricted Company of
any Stock, other than present and future Stock issued to other Companies or to
employees, directors, or consultants of any of the Companies.
ERISA means the Employee Retirement Income Security Act of 1974, as
amended, and the regulations and rulings thereunder.
ERISA AFFILIATE means any company or trade or business (whether or not
incorporated) which, for purposes of Title IV of ERISA, is a member of
Borrower's controlled group or which is under common control with Borrower
within the meaning of Section 414(b), (c), (m), or (o) of the Tax Code.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
6
EURODOLLAR BORROWING means a Borrowing bearing interest at the sum of
the Adjusted Eurodollar Rate plus the Applicable Margin for Eurodollar
Borrowings.
EURODOLLAR RATE means, for any Eurodollar Borrowing for any Interest
Period:
(a) the rate per annum equal to the rate determined by
Administrative Agent to be the offered rate that appears on the page of the
Telerate screen (or any successor thereto) that displays an average British
Bankers Association Interest Settlement Rate for deposits in Dollars (for
delivery on the first day of such Interest Period) with a term equivalent to
such Interest Period, determined as of approximately 11:00 a.m. (London time)
two (2) Business Days prior to the first day of such Interest Period; or
(b) if the rate referenced in the preceding CLAUSE (a) does not
appear on such page or service or such page or service shall not be available,
the rate per annum equal to the rate determined by Administrative Agent to be
the offered rate on such other page or other service that displays an average
British Bankers Association Interest Settlement Rate for deposits in Dollars
(for delivery on the first day of such Interest Period) with a term equivalent
to such Interest Period, determined as of approximately 11:00 a.m. (London time)
two (2) Business Days prior to the first day of such Interest Period; or
(c) if the rates referenced in the preceding CLAUSES (a) and (b)
are not available, the rate per annum determined by Administrative Agent as the
rate of interest at which deposits in Dollars for delivery on the first day of
such Interest Period in same day funds in the approximate amount of the
Eurodollar Borrowing being made, continued, or converted by Administrative Agent
and with a term equivalent to such Interest Period would be offered by
Administrative Agent's London branch to major banks in the London interbank
eurodollar market at their request at approximately 4:00 p.m. (London time) two
(2) Business Days prior to the first day of such Interest Period.
EVENT OF DEFAULT is defined in SECTION 10.
EXCESS CASH means, for the Restricted Companies as of any date of
determination thereof, (a) cash, plus (b) time deposits with, and certificates
of deposit, bank notes and bankers' acceptances issued by, any Lender or any
domestic bank, savings bank or savings and loan association having capital,
surplus and undivided profits aggregating at least $1,000,000,000, plus (c)
investments in direct obligations of the United States of America or any agency,
government-sponsored enterprise or instrumentality thereof, or obligations fully
guaranteed by the United States of America or any agency, government-sponsored
enterprise or instrumentality thereof, provided that such obligations mature
within one (1) year of the date of acquisition thereof, plus (d) investments in
commercial paper rated (at the time of purchase) in one of the two highest
short-term rating categories by two (2) or more national credit rating agencies
and maturing not more than two hundred and seventy (270) days from the date of
creation thereof, plus (e) repurchase agreements involving any of the
obligations described in CLAUSES (b), (c) and (d) above so long as the other
party to the repurchase agreement has short-term unsecured debt obligations or
short-term deposits rated (at the time of purchase) in the highest grade by two
(2) or more national credit rating agencies, plus (f) investments in direct
obligations of any money-market fund or other similar investment company that is
rated "AAAm" or "AAAm-G" by S & P and "Aaa" by Moody's or whose investments
consist, directly or indirectly, primarily of short-term money market
securities, which may include obligations described in the foregoing clauses of
this definition, minus (g) $15,000,000; provided that in no event shall Excess
Cash be less than zero.
EXCLUDED SUBSIDIARY means any Unrestricted Subsidiary that has a
continuing default or event of default under any Debt in excess of $20,000,000
at any time.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
7
EXCLUDED TAXES is defined in SECTION 4.6(a).
EXHIBIT means an exhibit to this Agreement unless otherwise specified.
EXISTING LETTERS OF CREDIT means those certain letters of credit listed
on SCHEDULE 1.1.
FEDERAL FUNDS RATE means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with member banks
of the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day; provided that (a) if such day is not a Business Day, then
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, then the Federal Funds Rate for such day shall be the average rate charged
to Administrative Agent (in its individual capacity) on such day on such
transactions.
FINANCIAL HEDGE means a swap, collar, floor, cap, or other contract
which is intended to reduce or eliminate the risk of fluctuations in interest
rates.
FINANCIAL STATEMENTS means balance sheets, statements of operations,
statements of shareholders' investments, and statements of cash flows prepared
in accordance with GAAP, which statements of operations and statements of cash
flows shall be in comparative form to the corresponding period of the preceding
fiscal year, and which balance sheets and statements of shareholders'
investments shall be in comparative form to the prior fiscal year-end figures.
FUND is defined in SECTION 13.13(g).
GAAP means generally accepted accounting principles in the United
States of America as set forth in the opinions and pronouncements of the
American Institute of Certified Public Accountants and the statements and
pronouncements of the Financial Accounting Standards Board which are applicable
from time to time.
GOVERNMENTAL AUTHORITY means any applicable (a) local, state,
municipal, federal, or foreign judicial, executive, or legislative
instrumentality, (b) private arbitration board or panel, or (c) central bank.
HAZARDOUS MATERIAL means "hazardous substance," "pollutant or
contaminant," and "petroleum," and "natural gas liquids" as those terms are
defined or used in Section 101 of the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. Section 96.01 et seq.), as amended or
supplemented from time to time, and any other substances regulated because of
their effect or potential effect on public health and the environment including
PCBs, lead paint, asbestos, urea formaldehyde, radioactive materials,
putrescible materials, petroleum distillates, medical waste, and infectious
materials.
HONOR DATE is defined in SECTION 2.1(c).
INCREASING LENDER is defined in SECTION 2.2(b).
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
8
INDEMNIFIED LIABILITIES is defined in SECTION 11.10(b).
INDEMNITEES is defined in SECTION 11.10(b).
INTEREST COVERAGE RATIO means, as of any date of determination thereof,
the ratio of (a) Consolidated EBITDA, plus net income of each Unrestricted
Subsidiary (without duplication and determined in accordance with GAAP) that is
earned and eligible for distribution, to (b) Consolidated Interest Expense, in
each case for the most-recent four (4) fiscal quarters ending on or prior to the
date of determination.
INTEREST EXPENSE means, for any period of calculation thereof, for any
Person, the aggregate amount of all interest (including facility and utilization
fees) on all Debt of such Person, whether paid in cash or accrued as a liability
and payable in cash during such period, including (a) imputed interest on
Capitalized Lease Obligations, (b) the amortization of any original issue
discount on any Debt, (c) the interest portion of any deferred payment
obligation, (d) all commissions, discounts, and other fees and charges owed with
respect to letters of credit or bankers' acceptance financing, (e) net costs
associated with Financial Hedges, and (f) the interest component of any Debt
that is guaranteed or secured by such Person, and all cash premiums or penalties
for the repayment, redemption, or repurchase of Debt.
INTEREST PERIOD is determined in accordance with SECTION 2.1(c)(ii).
L/C CREDIT EXTENSION means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal,
amendment, or increase of the amount thereof.
L/C ISSUERS means Bank of America, N.A., Bank One, NA, JPMorgan Chase
Bank, Suntrust Bank, BNP Paribas, Comerica Bank, and such other Lenders which
agree, at the request of Borrower and with the consent of Administrative Agent
(such consent not to be unreasonably withheld), to issue one or more Letters of
Credit pursuant to the terms and conditions of this Agreement, and L/C ISSUER
means any one of the L/C ISSUERS.
L/C OBLIGATIONS means, as at any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts.
LEGAL REQUIREMENTS means all applicable statutes, laws, treaties,
ordinances, tariff requirements, rules, regulations, orders, writs, injunctions,
decrees, judgments, opinions, or interpretations of any Governmental Authority.
LENDERS means, on any date of determination, the financial institutions
named on SCHEDULE 2.1 (as the same may be amended from time to time by
Administrative Agent to reflect the admission of a Subsequent Lender in
accordance with SECTION 2.2(b) and assignments made in accordance with SECTION
13.13(b)), and subject to the terms and conditions of this Agreement, their
respective successors and assigns.
LETTER OF CREDIT means any letter of credit issued hereunder. A Letter
of Credit hereunder shall be a standby or commercial letter of credit.
LETTER OF CREDIT APPLICATION means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use
by each L/C Issuer.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
9
LETTER OF CREDIT EXPIRATION DATE means August 5, 2005.
LEVERAGE RATIO means, as of any date of determination thereof, the
ratio of (a) Consolidated Debt outstanding on such date minus Subordinated Debt
in an amount not to exceed $200,000,000, to (b) the sum of (i) Consolidated Debt
outstanding on such date, plus (ii) Consolidated Tangible Net Worth determined
in accordance with GAAP.
LIEN means any lien, mortgage, security interest, pledge, assignment,
charge, title retention agreement, or encumbrance of any kind, and any other
Right of or arrangement with any creditor (other than under or relating to
subordination or other intercreditor arrangements) to have its claim satisfied
out of any property or assets, or the proceeds therefrom, prior to the general
creditors of the owner thereof.
LITIGATION means any action by or before any Governmental Authority.
LOAN DOCUMENTS means (a) this Agreement and the Notes, (b) the Letters
of Credit and Letter of Credit Applications, (c) all agreements, documents, or
instruments in favor of any Credit Party ever delivered by Borrower pursuant to
this Agreement or otherwise delivered in connection with all or any part of the
Obligation, and (d) any and all future renewals, extensions, restatements,
reaffirmations, or amendments of, or supplements to, all or any part of the
foregoing.
MATERIAL ADVERSE EVENT means any set of one or more circumstances or
events which, individually or collectively, could reasonably be expected to
result in any (a) material impairment of the ability of Borrower to perform any
of its payment or other material obligations under the Loan Documents, (b)
material and adverse effect on the business, properties, condition (financial or
otherwise), or results of operations of the Companies (taken as a whole), (c)
material and adverse effect on the validity or enforceability of any of the Loan
Documents or the Rights of any Credit Party thereunder, or (d) Potential Default
or Event of Default. The term Material Adverse Event is used in this Agreement
to qualify certain of the representations, warranties, and covenants contained
herein, but is not, in and of itself, a condition precedent to any Borrowings
hereunder or an independent representation (except as provided in the last
sentence of SECTION 7.6), covenant, or Event of Default.
MAXIMUM AMOUNT and MAXIMUM RATE respectively mean, for each Lender, the
maximum non-usurious amount and the maximum non-usurious rate of interest which,
under all Legal Requirements, such Lender is permitted to contract for, charge,
take, reserve, or receive on the Obligation.
MOODY'S means Moody's Investors Service, Inc. and any successor
thereto.
MOODY'S RATING means the most recently-announced rating from time to
time of Moody's assigned to any class of long-term senior, unsecured debt
securities issued by Borrower, as to which no letter of credit, guaranty, or
third-party credit support is in place, regardless of whether all or any part of
such Debt has been issued at the time such rating was issued.
MULTIEMPLOYER PLAN means a multiemployer plan as defined in Section
3(37) or 4001(a)(3) of ERISA or Section 414(f) of the Tax Code to which any
Company or any ERISA Affiliate is making, or has made, or is accruing, or has
accrued, an obligation to make contributions.
NET PROCEEDS means, with respect to any Equity Issuance by Borrower or
any Restricted Subsidiary, the amount of cash received by such Company in
connection with such transaction after deducting therefrom the aggregate,
without duplication, of the following amounts to the extent properly
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
10
attributable to such transaction: (a) reasonable brokerage commissions,
attorneys' fees, finder's fees, financial advisory fees, accounting fees,
underwriting fees, investment banking fees, and other similar commissions and
fees (and expenses and disbursements of any of the foregoing), in each case, to
the extent paid or payable by such Company; (b) printing and related expenses
and filing, recording, or registration fees or charges or similar fees or
charges paid by such Company; and (c) taxes paid or payable by such Company to
any Governmental Authority as a result of such transaction.
NOTES means each promissory note substantially in the form of EXHIBIT
A, executed by Borrower, and all modifications, amendments, renewals,
extensions, and restatements of all or any part thereof, and NOTE means any one
of the Notes.
NOTICE OF CONVERSION/CONTINUATION means a notice substantially in the
form of EXHIBIT C.
OBLIGATION means all present and future indebtedness, liabilities, and
obligations, and all renewals and extensions thereof, or any part thereof, now
or hereafter owed to any Credit Party or any Affiliate of any Credit Party by
Borrower pursuant to any Loan Document, together with all interest accruing
thereon, fees, costs, and expenses (including all reasonable Attorney Costs
incurred in the enforcement or collection thereof) payable under the Loan
Documents.
PARTICIPANT is defined in SECTION 13.13(d).
PAYMENT OFFICE means Administrative Agent's office located at Dallas,
Texas or such other office as Administrative Agent shall notify Borrower and the
Credit Parties in writing.
PBGC means the Pension Benefit Guaranty Corporation, or any successor
thereof, established pursuant to ERISA.
PERMITTED LIENS means Liens permitted under SECTION 9.2 as described in
such SECTION.
PERSON means any individual, entity, or Governmental Authority.
POTENTIAL DEFAULT means the occurrence of any event or existence of any
circumstance which, with the giving of notice or lapse of time or both, would
become an Event of Default.
PRIME RATE means, for any day, a fluctuating rate per annum equal to
the higher of (a) the Federal Funds Rate for such day plus one-half of one
percent (0.5%), and (b) the per annum rate of interest in effect for such day as
publicly announced from time to time by Bank of America, N.A. as its prime rate,
which rate may not be the lowest rate of interest charged by Bank of America,
N.A. to its customers for such day. The "prime rate" is a rate set by Bank of
America, N.A. based upon various factors including its costs and desired return,
general economic conditions, and other factors, and it is used as a reference
point for pricing of some loans which may be priced at, above, or below such
announced rate. Any change in Bank of America N.A.'s "prime rate" or the Federal
Funds Rate shall be effective on the effective date of such change in the "prime
rate" or the Federal Funds Rate.
PRIME RATE BORROWING means a Borrowing bearing interest at the sum of
the Prime Rate plus the Applicable Margin for Prime Rate Borrowings.
PRINCIPAL DEBT means, for a Credit Party and at any time, the unpaid
principal balance of all outstanding Borrowings from such Credit Party hereunder
as of such date.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
11
PRO RATA or PRO RATA PART, for each Lender, means (a) for purposes of
any commitment to participate in Letters of Credit and fund Borrowings in
respect of this Agreement, respectively, the percentage stated opposite such
Lender's name as set forth on SCHEDULE 2.1 or on the most recently amended
SCHEDULE 2.1, if any, prepared by Administrative Agent pursuant to SECTION 2.2
or SECTION 13.13, and (b) for all other purposes, the proportion which the
portion of the Principal Debt and L/C Obligations owed to such Lender (without
duplication, whether directly (net of participations sold to other Lenders) or
by participation) bears to the Total Outstandings at the time in question, or if
no Principal Debt or L/C Obligations are outstanding, then the proportion that
the aggregate of such Lender's Commitment bears to the Total Commitment then in
effect.
QUARTERLY CONSOLIDATED NET INCOME means, for any fiscal quarter,
Consolidated Adjusted Net Income for such quarter; provided that if Consolidated
Adjusted Net Income for any quarter is less than $0, then Quarterly Consolidated
Net Income for such fiscal quarter shall be equal to $0.
RECOURSE DEBT means all Debt of each Unrestricted Subsidiary on which
any Restricted Company is obligated, as a guarantor or otherwise.
REGISTER is defined in SECTION 13.13(c).
REGULATION D means Regulation D of the Board of Governors of the
Federal Reserve System, as amended.
REGULATION U means Regulation U of the Board of Governors of the
Federal Reserve System, as amended.
RELEASE means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, or disposing into
the environment (including air, groundwater, surface water, soil, other
environmental media, or natural resources).
REPAYMENT DATE is defined in SECTION 2.1(c)(vii).
REPORTABLE EVENT shall have the meaning specified in Section 4043 of
ERISA or the regulations issued thereunder in connection with an Employee Plan,
excluding events for which the notice requirement is waived under applicable
PBGC regulations other than those events described in Sections 2615.11, 2615.15
and 2615.19 of such regulations, including each such provision as it may
subsequently be renumbered.
REPRESENTATIVES means representatives, officers, directors, employees,
attorneys, and agents.
REQUIRED LENDERS means (a) on any date of determination prior to
termination of the Total Commitment, those Lenders (other than Defaulting
Lenders) collectively holding more than fifty percent (50%) of the Total
Commitment (excluding the Commitments of any Defaulting Lenders), or (b) on any
date of determination occurring after the Total Commitment has terminated, those
Lenders collectively holding more than fifty percent (50%) of the Total
Outstandings (excluding the Principal Debt and L/C Obligations of any Defaulting
Lenders).
RESERVE REQUIREMENT means, at any time, the maximum rate at which
reserves (including any marginal, special, supplemental, or emergency reserves)
are required to be maintained under regulations
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
12
issued from time to time by the Board of Governors of the Federal Reserve System
(or any successor) by member banks of the Federal Reserve System against
"Eurocurrency liabilities" (as such term is used in Regulation D). Without
limiting the effect of the foregoing, the Reserve Requirement shall reflect any
other reserves required to be maintained by such member banks with respect to
(a) any category of liabilities which includes deposits by reference to which
the Adjusted Eurodollar Rate is to be determined, or (b) any category of
extensions of credit or other assets which include Eurodollar Borrowings. The
Adjusted Eurodollar Rate shall be adjusted automatically on and as of the
effective date of any change in the Reserve Requirement.
RESPONSIBLE OFFICER of Borrower means its chairman, vice chairman,
president, chief executive officer, chief financial officer, executive vice
president, senior vice president, or treasurer, or, for all purposes under the
Loan Documents, any other officer designated from time to time by the Board of
Directors or Executive Committee of the Board of Directors of Borrower, which
designated officer is acceptable to Administrative Agent.
RESTRICTED COMPANY means Borrower and each Restricted Subsidiary.
RESTRICTED SUBSIDIARY means each of Borrower's Subsidiaries, other than
Unrestricted Subsidiaries.
RIGHTS means rights, remedies, powers, privileges, and benefits.
SCHEDULE means, unless specified otherwise, a schedule attached to this
Agreement, as the same may be supplemented and modified from time to time in
accordance with the terms of the Loan Documents.
SOLVENT means, as to a Person, that (a) the aggregate fair market value
of such Person's assets exceeds its liabilities (whether contingent,
subordinated, unmatured, unliquidated, or otherwise), (b) such Person has
sufficient cash flow to enable it to pay its Debts as they mature, and (c) such
Person does not have unreasonably small capital to conduct such Person's
businesses.
S & P means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc. and any successor thereto.
S & P RATING means the most recently-announced rating from time to time
of S & P assigned to any class of long-term senior, unsecured debt securities
issued by Borrower, as to which no letter of credit, guaranty, or third-party
credit support is in place, regardless of whether all or any part of such Debt
has been issued at the time such rating was issued.
STOCK means all shares, options, warrants, general or limited
partnership interests, membership interests, or other ownership interests
(regardless of how designated) of or in a corporation, partnership, limited
liability company, trust, or other entity, whether voting or nonvoting,
including common stock, preferred stock, or any other similar "equity security"
(as such term is defined in Rule 3a11-1 of the General Rules and Regulations
promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended).
SUBORDINATED DEBT means any Debt of Borrower (a) subordinated to the
Obligation and including customary provisions regarding payment blockage,
payover, standstill, voting rights, and notices,
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
13
(b) which, as of the date of calculation, is not considered a "current
liability" in accordance with GAAP, and (c) which requires no payments of
principal until its maturity.
SUBSEQUENT LENDER is defined in SECTION 2.2(b).
SUBSIDIARY means, in respect of any Person (herein referred to as the
"PARENT"), any corporation, partnership, limited liability company, association,
or other business entity (a) of which Stock representing more than fifty percent
(50%) of the equity or more than fifty percent (50%) of the ordinary voting
power or more than fifty percent (50%) of the general partnership interests are,
at the time any determination is being made, owned, Controlled, or held, or (b)
which is, at the time any determination is made, 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 ownership by Borrower or its
Subsidiaries of more than fifty percent (50%) of the limited partnership
interests in Centex Development Company, L.P. shall not, by itself, result in
such company being deemed a Subsidiary of Borrower. "CONTROL" shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of Stock, by contract, or otherwise, and "CONTROLLING" and
"CONTROLLED" shall have meanings correlative thereto.
TANGIBLE NET WORTH means, for any Person as of any date of
determination, the consolidated net worth of such Person determined in
accordance with GAAP, less (without duplication), the sum of the following: (a)
all intangibles determined in accordance with GAAP (including, without
limitation, goodwill and deferred or capitalized acquisition costs), (b) all
minority interests in any Subsidiary of such Person, (c) unamortized Debt
discount and expense, (d) any non-cash gain (or plus any non-cash loss, as
applicable) resulting from any mark-to-market adjustments made directly to
consolidated net worth as a result of fluctuations in the value of financial
instruments owned by Borrower or any of its Subsidiaries as mandated under FAS
133, and (e) all reserves (except contingency reserves not allocated to specific
purposes and not deducted from assets, which are properly treated as
appropriations of surplus or retained earnings) and any write-up in book value
of assets resulting from a revaluation of such asset subsequent to March 31,
2003.
TAX CODE means the Internal Revenue Code of 1986, as amended, together
with the rules and regulations promulgated thereunder.
TAXES means, for any Person, taxes, assessments, duties, levies,
imposts, deductions, charges, or withholdings, or other governmental charges or
levies imposed upon such Person, its income, or any of its properties,
franchises, or assets.
TERMINATION DATE means the earlier of (a) August 5, 2004, and (b) the
effective date of any other termination or cancellation of all of Lenders'
Commitments to make Credit Extensions under, and in accordance with, this
Agreement.
TOTAL COMMITMENT means, on any date of determination, the sum of all
Commitments for all Lenders (as the same may have been reduced, increased, or
canceled in accordance with this Agreement) then in effect.
TOTAL OUTSTANDINGS means the amount of Total Principal Debt plus
(without duplication) the outstanding amount of L/C Obligations.
TOTAL PRINCIPAL DEBT means, at any time, the sum of the Principal Debt
of all Lenders.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
14
TYPE means any type of Borrowing determined with respect to the
interest option applicable thereto.
UNREIMBURSED AMOUNT has the meaning set forth in SECTION 2.1(c)(i).
UNRESTRICTED SUBSIDIARY means any Subsidiary (a) that is designated as
an Unrestricted Subsidiary on the Closing Date and listed on SCHEDULE 7.3, or
(b) as otherwise designated in a writing delivered to Administrative Agent and
meeting the requirements set forth in SECTION 8.12.
WHOLLY-OWNED when used in connection with any Subsidiary shall mean a
Subsidiary of which all of the issued and outstanding shares of Stock (except
shares required as directors' qualifying shares) shall be owned by Borrower or
one or more of its Wholly-owned Subsidiaries.
1.2 NUMBER AND GENDER OF WORDS; OTHER REFERENCES. Unless otherwise
specified in the Loan Documents, (a) where appropriate, the singular includes
the plural and vice versa, and words of any gender include each other gender,
(b) heading and caption references may not be construed in interpreting
provisions, (c) monetary references are to currency of the United States of
America, (d) section, paragraph, annex, schedule, exhibit, and similar
references are to the particular Loan Document in which they are used, (e)
references to "telecopy," "facsimile," "fax," or similar terms are to facsimile
or telecopy transmissions, (f) references to "including" mean including without
limiting the generality of any description preceding that word, (g) the rule of
construction that references to general items that follow references to specific
items are limited to the same type or character of those specific items is not
applicable in the Loan Documents, (h) references to any Person include that
Person's heirs, personal representatives, successors, trustees, receivers, and
permitted assigns, (i) references to any Legal Requirement include every
amendment or supplement to it, rule and regulation adopted under it, and
successor or replacement for it, and (j) references to any Loan Document or
other document include every renewal and extension of it, amendment and
supplement to it, and replacement or substitution for it.
1.3 ACCOUNTING PRINCIPLES. All accounting and financial terms used
in the Loan Documents and the compliance with each financial covenant therein
shall be determined in accordance with GAAP, and all accounting principles shall
be applied on a consistent basis so that the accounting principles in a current
period are comparable in all material respects to those applied during the
preceding comparable period. If Borrower or any Credit Party determines that a
change in GAAP from that in effect on the date hereof has altered the treatment
of certain financial data to its detriment under this Agreement, then such party
may, by written notice to the others and Administrative Agent not later than ten
(10) days after the effective date of such change in GAAP, request renegotiation
of the financial covenants affected by such change. If Borrower and Required
Lenders have not agreed on revised covenants within thirty (30) days after
delivery of such notice, then, for purposes of this Agreement, GAAP will mean
generally accepted accounting principles without giving effect to the change
that gave rise to the renegotiation.
1.4 TIME REFERENCES. Unless otherwise specified in the Loan
Documents (a) time references are to time in Chicago, Illinois, and (b) in
calculating a period from one date to another, the word "from" means "from and
including" and the word "to" or "until" means "to but excluding."
SECTION 2 CREDIT EXTENSION PROVISIONS.
2.1 LETTERS OF CREDIT.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
15
(a) THE LETTER OF CREDIT COMMITMENT.
(i) Subject to the terms and conditions set forth herein,
(A) each L/C Issuer agrees, in reliance upon the agreements of the
other Lenders set forth in this SECTION 2.1, (x) from time to time on
any Business Day during the period from the Closing Date until the
Termination Date, to issue Letters of Credit for the account of
Borrower or for the account of Borrower and one or more Subsidiaries
(provided that the issuance of a Letter of Credit for the account of a
Subsidiary of Borrower shall not relieve Borrower of any of its
obligations under this Agreement), and to amend (which may include
renewals, extensions, or increases in a Letter of Credit) Letters of
Credit previously issued by it, in accordance with SECTION 2.1(b); (y)
from time to time on any Business Day during the period from the
Termination Date until the Business Day immediately prior to the Letter
of Credit Expiration Date, to amend Letters of Credit previously issued
by it in accordance with SECTION 2.1(b); provided that no such
amendment shall renew, extend, or increase any such Letter of Credit;
and (z) at any time, in accordance with the terms of the Letters of
Credit, to honor drafts under the Letters of Credit; provided that no
L/C Issuer shall be obligated to make any L/C Credit Extension with
respect to any Letter of Credit if the Total Outstandings would exceed
the Total Commitment; and (B) Lenders severally agree to participate in
Letters of Credit issued for the account of Borrower or for the account
of Borrower and one or more Subsidiaries; provided that no Lender shall
be obligated to participate in any Letter of Credit if as of the date
of such L/C Credit Extension, any Lender's Pro Rata Part of the Total
Outstandings would exceed such Lender's Commitment. Within the
foregoing limits, and subject to the terms and conditions hereof,
Borrower's ability to obtain Letters of Credit shall be fully
revolving, and accordingly Borrower may, during the foregoing period,
obtain Letters of Credit to replace Letters of Credit that have expired
or been canceled or that have been drawn upon and reimbursed. All
Existing Letters of Credit shall be deemed to have been issued pursuant
hereto, and from and after the Closing Date shall be subject to and
governed by the terms and conditions hereof.
(ii) No L/C Issuer shall issue any Letter of Credit if:
(A) any order, judgment, or decree of any
Governmental Authority with jurisdiction
over such L/C Issuer shall by its terms
purport to enjoin or restrain such L/C
Issuer from issuing such Letter of Credit,
or any Legal Requirement applicable to such
L/C Issuer or any request or directive
(whether or not having the force of law)
from any Governmental Authority with
jurisdiction over such L/C Issuer shall
prohibit, or request that such L/C Issuer
refrain from, the issuance of letters of
credit generally or such Letter of Credit in
particular or shall impose upon such L/C
Issuer with respect to such Letter of Credit
any restriction, reserve, or capital
requirement (for which such L/C Issuer is
not otherwise compensated hereunder) not in
effect on the Closing Date, or shall impose
upon such L/C Issuer any unreimbursed loss,
cost, or expense which was not applicable on
the Closing Date and which such L/C Issuer
in good faith deems material to it;
(B) except for the applicable Existing Letters
of Credit and Letters of Credit issued after
the Closing Date in an aggregate maximum
available amount that does not exceed
$2,000,000 at any time, the expiry date of
such
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
16
requested Letter of Credit would occur more
than twelve (12) months after the date of
issuance, unless the Required Lenders have
approved such expiry date;
(C) the issuance of such Letter of Credit would
violate one or more policies of such L/C
Issuer with respect to the issuance of
letters of credit generally; or
(D) such Letter of Credit is in an initial
amount less than $10,000 (unless otherwise
agreed to by Administrative Agent and the
L/C Issuer) or is to be used for a purpose
other than general corporate needs including
insurance bonding requirements or
denominated in a currency other than
Dollars.
(iii) No L/C Issuer shall be obligated to amend (which may
include renewals, extensions, or increases in a Letter of Credit) any
Letter of Credit if (A) such L/C Issuer would have no obligation at
such time to issue such Letter of Credit in its amended form under the
terms hereof, or (B) the beneficiary of such Letter of Credit does not
accept the proposed amendment to such Letter of Credit.
(b) PROCEDURES FOR ISSUANCE AND AMENDMENT OF LETTERS OF CREDIT.
(i) Each Letter of Credit shall be issued or amended, as
the case may be, upon the request of Borrower delivered to an L/C
Issuer (with a copy to Administrative Agent) in the form of a Letter of
Credit Application, appropriately completed and signed by a Responsible
Officer of Borrower. Such Letter of Credit Application must be received
by an L/C Issuer and Administrative Agent not later than 11:00 a.m. at
least five (5) Business Days (or such later date and time as such L/C
Issuer may agree in a particular instance in its sole discretion) prior
to the proposed issuance date or date of amendment, as the case may be.
In the case of a request for an initial issuance of a Letter of Credit,
such Letter of Credit Application shall specify in form and detail
reasonably satisfactory to such L/C Issuer: (A) the proposed issuance
date of the requested Letter of Credit (which shall be a Business Day);
(B) the amount thereof; (C) the expiry date thereof; (D) the name and
address of the beneficiary thereof; (E) the documents to be presented
by such beneficiary in case of any drawing thereunder; (F) the full
text of any certificate to be presented by such beneficiary in case of
any drawing thereunder; (G) the name and address of any Subsidiary that
is an account party along with Borrower; and (H) such other matters as
such L/C Issuer may reasonably require. In the case of a request for an
amendment of any outstanding Letter of Credit, such Letter of Credit
Application shall specify in form and detail reasonably satisfactory to
the applicable L/C Issuer: (A) the Letter of Credit to be amended; (B)
the proposed date of amendment thereof (which shall be a Business Day);
(C) the nature of the proposed amendment; and (D) such other matters as
such L/C Issuer may reasonably require.
(ii) Promptly after receipt of any Letter of Credit
Application, the L/C Issuer will confirm with Administrative Agent (by
telephone or in writing) that Administrative Agent has received a copy
of such Letter of Credit Application from Borrower and, if not, the L/C
Issuer will provide Administrative Agent with a copy thereof. Upon
receipt by such L/C Issuer of confirmation from Administrative Agent
that the requested issuance or amendment is permitted in accordance
with the terms hereof, then, subject to the terms and conditions
hereof, such L/C Issuer shall, on the requested date, issue a Letter of
Credit for the account of Borrower or
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
17
Borrower and the specified Subsidiary or enter into the applicable
amendment, as the case may be, in each case in accordance with such L/C
Issuer's usual and customary business practices. If, prior to the
issuance of a Letter of Credit, the applicable L/C Issuer receives a
request from Borrower to review the Letter of Credit to be issued, such
L/C Issuer shall send a copy of such proposed Letter of Credit to
Borrower for review. Immediately upon the issuance of each Letter of
Credit, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from such L/C Issuer a risk
participation in such Letter of Credit in an amount equal to the
product of such Lender's Pro Rata Part times the amount of such Letter
of Credit.
(iii) If Borrower so requests in any applicable Letter of
Credit Application, the applicable L/C Issuer may, in its sole and
absolute discretion, agree to issue a Letter of Credit that has
automatic renewal provisions (each, an "AUTO-RENEWAL LETTER OF
CREDIT"); provided that any such Auto-Renewal Letter of Credit must
permit such L/C Issuer to prevent any such renewal at least once in
each twelve-month period (commencing with the date of issuance of such
Letter by Credit) by giving prior notice to the beneficiary thereof not
later than a day (the "NONRENEWAL NOTICE DATE") in each such
twelve-month period to be agreed upon at the time such Letter of Credit
is issued. Unless otherwise directed in writing by such L/C Issuer, the
Borrower shall not be required to make a specific request to such L/C
Issuer for any such renewal. Once an Auto-Renewal Letter of Credit has
been issued, the Lenders shall be deemed to have authorized (but may
not require) such L/C Issuer to permit the renewal of such Letter of
Credit at any time to an expiry date not later than the Letter of
Credit Expiration Date; provided, however, that such L/C Issuer shall
not permit any such renewal if (A) such L/C Issuer has determined that
it could not at such time issue such Letter of Credit in its renewed
form under the terms hereof (by reason of the provisions of SECTION
2.1(a)(ii) or otherwise), or (B) it has received notice (which may be
by telephone or in writing) on or before the day that is two Business
Days before the Nonrenewal Notice Date (1) from the Administrative
Agent that the Required Lenders have elected not to permit such renewal
or (2) from the Administrative Agent, any Lender or the Borrower that
one or more of the applicable conditions specified in SECTION 6.2 is
not then satisfied.
(iv) Promptly after its delivery of any Letter of Credit
or any amendment to a Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver
to Borrower and Administrative Agent a true and complete copy of such
Letter of Credit or amendment.
(c) DRAWINGS AND REIMBURSEMENTS; FUNDING OF PARTICIPATIONS.
(i) Upon receipt from the beneficiary of any Letter of
Credit of any notice of a drawing under such Letter of Credit, the
applicable L/C Issuer shall promptly notify Borrower and Administrative
Agent thereof. Not later than 11:00 a.m. on the date of any payment by
any L/C Issuer under a Letter of Credit (each such date, an "HONOR
DATE"), Borrower shall reimburse such L/C Issuer through Administrative
Agent in an amount equal to the amount of such drawing (prior to any
conversion into a Borrowing, the "UNREIMBURSED AMOUNT"); provided that
if the Honor Date for such Letter of Credit occurs prior to the
Termination Date, then, unless Borrower reimburses L/C Issuer through
Administrative Agent in respect of such drawing prior to 11:00 a.m. on
such Honor Date, such Unreimbursed Amount shall automatically convert
into a Prime Rate Borrowing or, if Borrower has so elected pursuant to
and in accordance with SECTION 2.1(c)(ii) and so long as no Event of
Default exists, into a Eurodollar Borrowing.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
18
(ii) Borrower may, upon irrevocable notice to L/C Issuer
and Administrative Agent in accordance with SECTION 2.1(c)(iii), (A)
elect, as of any Business Day, to convert any Prime Rate Borrowing (or
Unreimbursed Amount if such Business Day occurs prior to the
Termination Date) into a Eurodollar Borrowing or (B) elect, as of the
last day of any Interest Period having a duration of fourteen (14)
days, (x) to continue Eurodollar Borrowings having Interest Periods
expiring on such day as Eurodollar Borrowings having Interest Periods
of fourteen (14) days, or (y) to convert Eurodollar Borrowings having
Interest Periods expiring on such day into Prime Rate Borrowings. When
Borrower requests to convert any Unreimbursed Amount or Prime Rate
Borrowing into a Eurodollar Borrowing, Borrower may elect the interest
period (each an "INTEREST PERIOD") applicable thereto, which shall be,
at Borrower's option, fourteen (14) days or one (1) month in each case
to the extent available from each Lender; provided, however, that: (a)
the initial Interest Period for a Eurodollar Borrowing shall commence
on the date of such Borrowing (including the date of any Conversion
thereto), and each Interest Period occurring thereafter in respect of
such Borrowing shall commence on the day on which the next preceding
Interest Period applicable thereto expires; (b) if any Interest Period
for a Eurodollar Borrowing begins on a day for which there is no
numerically corresponding Business Day in the calendar month at the end
of such Interest Period, then such Interest Period shall end on the
next Business Day immediately following what otherwise would have been
such numerically corresponding day in the calendar month at the end of
such Interest Period (unless such date would be in a different calendar
month from what would have been the month at the end of such Interest
Period, or unless there is no numerically corresponding day in the
calendar month at the end of the Interest Period; whereupon, such
Interest Period shall end on the last Business Day in the calendar
month at the end of such Interest Period); (c) no Interest Period may
be chosen with respect to any portion of any Borrowing which would
extend beyond the scheduled repayment date (including any dates on
which mandatory prepayments are required to be made) for such portion
of the Total Principal Debt.
(iii) Borrower shall deliver a Notice of
Conversion/Continuation to be received by L/C Issuer and Administrative
Agent not later than 11:00 a.m. at least three (3) Business Days in
advance of the Conversion/Continuation Date, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the type of Borrowing resulting from the proposed
conversion or continuation; and
(C) other than in the case of conversions into Prime Rate
Borrowings, the duration of the requested Interest
Period.
Upon receipt of a Notice of Conversion/Continuation, Administrative
Agent shall promptly notify each Lender of the contents thereof and
such notice shall not thereafter be revocable by Borrower.
(iv) If upon the expiration of any Interest Period
Borrower has failed to continue the Eurodollar Borrowings having
Interest Periods then expiring, Borrower shall be deemed to have
elected to convert such Eurodollar Borrowings into Prime Rate
Borrowings effective as of the expiration date of such Interest Period.
(v) Each Borrowing shall bear interest on the outstanding
principal amount thereof from the date of such Borrowing until the date
repaid at a rate per annum equal to the Adjusted Eurodollar Rate or the
Prime Rate, as the case may be (and subject to Borrower's
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
19
right to convert to the other type of Borrowing under this SECTION
2.1(c)), plus the Applicable Margin. Notwithstanding the foregoing,
after the Termination Date any Unreimbursed Amounts shall bear interest
at the Default Rate. Interest on each Borrowing shall be paid in
arrears on the Repayment Date.
(vi) Borrower may, subject to SECTION 2.1(c)(viii) and
upon at least one (1) Business Day's notice to Administrative Agent,
prepay any Borrowing in whole or in part by prepaying the principal
amount to be prepaid together with accrued interest thereon to the date
of prepayment plus any amounts owing pursuant to SECTION 4.5.
(vii) All Borrowings resulting from an Unreimbursed Amount
shall be due and payable on the thirty-first (31st) day after the date
the Unreimbursed Amount is converted into a Borrowing (or, if such day
is not a Business Day, on the first (1st) Business Day succeeding such
day) (the "REPAYMENT DATE").
(viii) If Borrower prepays any Eurodollar Borrowings on any
day other than the last day of an Interest Period applicable thereto,
or if any Unreimbursed Amount or Prime Rate Borrowing is not converted
or continued into an Eurodollar Borrowing after notice has been given
to Administrative Agent in accordance with SECTION 2.1(c)(iii),
Borrower shall reimburse each Lender for any amounts owing pursuant to
SECTION 4.5.
(ix) If Borrower fails to reimburse the applicable L/C
Issuer on any Honor Date, then Administrative Agent shall, upon notice
from the applicable L/C Issuer, notify each Lender of the Honor Date,
the Unreimbursed Amount, whether the Unreimbursed Amount has been
converted into a Prime Rate Borrowing or Eurodollar Borrowing, and such
Lender's Pro Rata Part of such Unreimbursed Amount or Borrowing. Each
Lender (including the Lender acting as L/C Issuer) shall upon any such
notice make funds available to Administrative Agent for the account of
the applicable L/C Issuer at the Applicable Lending Office of
Administrative Agent in an amount equal to its Pro Rata Part of such
Unreimbursed Amount or Borrowing not later than 1:00 p.m. on the
Business Day specified in such notice by Administrative Agent.
Administrative Agent shall remit the funds so received to the
applicable L/C Issuer.
(x) Until each Lender funds its participation or Pro Rata
Part of a Borrowing pursuant to SECTION 2.1(c)(ix) to reimburse the
applicable L/C Issuer for any amount drawn under any Letter of Credit,
interest in respect of such Lender's Pro Rata Part of such amount shall
be solely for the account of such L/C Issuer.
(xi) Each Lender's obligation to fund participations or
Borrowings to reimburse each L/C Issuer for amounts drawn under Letters
of Credit issued in accordance with this Agreement, as contemplated by
this SECTION 2.1(c), shall be absolute and unconditional and shall not
be affected by any circumstance, including (A) any set-off,
counterclaim, recoupment, defense, or other right which such Lender may
have against an L/C Issuer, Borrower, or any other Person for any
reason whatsoever, (B) the occurrence or continuance of an Event of
Default or Potential Default, or (C) any other occurrence, event, or
condition, whether or not similar to any of the foregoing.
(xii) If any Lender fails to make available to
Administrative Agent for the account of an L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions
of this SECTION 2.1(c) by the time specified in SECTION 2.1(c)(ix),
such L/C Issuer shall be entitled
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
20
to recover from such Lender (acting through Administrative Agent), on
demand, such amount with interest thereon for the period from the date
such payment is required to the date on which such payment is
immediately available to such L/C Issuer at a rate per annum equal to
the Federal Funds Rate from time to time in effect. A certificate of an
L/C Issuer submitted to any Lender (through Administrative Agent) with
respect to any amounts owing under this SECTION 2.1(c)(xii) shall be
conclusive absent manifest error.
(d) REPAYMENT OF PARTICIPATIONS OR BORROWINGS.
(i) At any time after an L/C Issuer has made a payment
under any Letter of Credit and has received from any Lender such
Lender's funding of its participation in an Unreimbursed Amount or Pro
Rata Part of a Borrowing as a result of such payment in accordance with
SECTION 2.1(c), if Administrative Agent receives for the account of
such L/C Issuer any payment in respect of the related Unreimbursed
Amount or Borrowing or interest thereon (whether directly from Borrower
or otherwise) Administrative Agent will distribute to such Lender its
Pro Rata Part thereof in the same funds as those received by
Administrative Agent.
(ii) If any payment received by Administrative Agent for
the account of an L/C Issuer pursuant to SECTION 2.1(c)(i) is required
to be returned under any of the circumstances described in SECTION
13.14 (including pursuant to any settlement entered into by an L/C
Issuer in its discretion), each Lender shall pay to Administrative
Agent for the account of such L/C Issuer its Pro Rata Part thereof on
demand of Administrative Agent, plus interest thereon from the date of
such demand to the date such amount is returned by such Lender, at a
rate per annum equal to the Federal Funds Rate from time to time in
effect.
(e) OBLIGATIONS ABSOLUTE. The obligation of Borrower to reimburse
an L/C Issuer for each drawing under each Letter of Credit and to repay each
Borrowing shall be absolute, unconditional, and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including the following:
(i) any lack of validity or enforceability of such Letter
of Credit, this Agreement, or any other agreement or instrument
relating thereto;
(ii) the existence of any claim, counterclaim, set-off,
defense, or other right that Borrower may have at any time against any
beneficiary or any transferee of such Letter of Credit (or any Person
for whom any such beneficiary or any such transferee may be acting),
any L/C Issuer or any other Person, whether in connection with this
Agreement, the transactions contemplated hereby, or by such Letter of
Credit or any agreement or instrument relating thereto, or any
unrelated transaction;
(iii) any draft, demand, certificate, or other document
presented under such Letter of Credit proving to be forged, fraudulent,
invalid, or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under such Letter of Credit;
(iv) any payment by any L/C Issuer under such Letter of
Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such Letter of Credit; or any payment
made by any L/C Issuer under such Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession,
assignee for the benefit of creditors, liquidator,
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
21
receiver, or other representative of or successor to any beneficiary or
any transferee of such Letter of Credit, including any arising in
connection with any proceeding under any Debtor Relief Law; or
(v) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or
a discharge of, Borrower.
Borrower shall promptly examine a copy of each Letter of Credit and each
amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with Borrower's instructions or other irregularity, Borrower will
promptly notify the applicable L/C Issuer. Borrower shall be conclusively deemed
to have waived any such claim against each L/C Issuer and their correspondents
unless such notice is given as aforesaid.
(f) ROLE OF L/C ISSUER. Each Lender and Borrower agree that, in
paying any drawing under a Letter of Credit, no L/C Issuer shall have any
responsibility to obtain any document (other than any sight draft, certificates,
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. No L/C Issuer,
Agent-Related Person, or any of the respective correspondents, participants, or
assignees of any L/C Issuer shall be liable to any Lender for (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders or the Required Lenders, as applicable, (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct, or (iii) the
due execution, effectiveness, validity, or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit Application.
Borrower hereby assumes all risks of the acts or omissions of any beneficiary or
transferee with respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude Borrower's
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. No L/C Issuer, Agent-Related
Person, or any of the respective correspondents, participants, or assignees of
any L/C Issuer, shall be liable or responsible for any of the matters described
in SECTIONS 2.01(e)(i) THROUGH (v); provided, however, that anything in such
clauses or elsewhere in this Agreement or any other Loan Document to the
contrary notwithstanding, Borrower may have a claim against an L/C Issuer, and
an L/C Issuer may be liable to Borrower, to the extent, but only to the extent,
of any direct, as opposed to consequential or exemplary, damages suffered by
Borrower which Borrower proves were caused by such L/C Issuer's willful
misconduct, bad faith, or gross negligence or such L/C Issuer's willful failure
to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit. In furtherance and not in limitation
of the foregoing, each L/C Issuer may accept documents that appear on their face
to be in order, without responsibility for further investigation, regardless of
any notice or information to the contrary, and no L/C Issuer shall be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
(g) APPLICABILITY OF ISP98 AND UCP. Unless otherwise expressly
agreed by any L/C Issuer and Borrower when a Letter of Credit is issued, (i) the
rules of the "International Standby Practices 1998" published by the Institute
of International Banking Law & Practice (or such later version thereof as may be
in effect at the time of issuance) shall apply to each standby Letter of Credit,
and (ii) the rules of the Uniform Customs and Practice for Documentary Credits,
as most recently published by the International Chamber of Commerce (the "ICC")
at the time of issuance (including the ICC decision
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
22
published by the Commission on Banking Technique and Practice on April 6, 1998
regarding the European single currency (euro)) shall apply to each commercial
Letter of Credit.
(h) CONFLICT WITH LETTER OF CREDIT APPLICATION. In the event of
any conflict between the terms hereof and the terms of any Letter of Credit
Application, the terms hereof shall control.
(i) CASH COLLATERAL. If, as of the Letter of Credit Expiration
Date, any Letter of Credit may for any reason remain outstanding and partially
or wholly undrawn, Borrower shall immediately Cash Collateralize the
then-undrawn amount of all outstanding Letters of Credit (in an amount equal to
such outstanding amount determined as of the Letter of Credit Expiration Date).
For purposes hereof, "CASH COLLATERALIZE" means to pledge and deposit with or
deliver to Administrative Agent, for the benefit of each L/C Issuer and the
Lenders, as collateral for the undrawn amount of all outstanding Letters of
Credit, cash or deposit account balances pursuant to documentation in form and
substance satisfactory to Administrative Agent and each L/C Issuer (which
documents are hereby consented to by the Lenders). Derivatives of such term have
corresponding meanings. Effective as of the time Borrower is required under this
SECTION 2.1(i) or any other provision of this Agreement or the Loan Documents to
Cash Collateralize the then-undrawn amount of all outstanding Letters of Credit,
Borrower hereby grants to Administrative Agent, for the benefit of each L/C
Issuer and the Lenders, a security interest in all such cash, deposit accounts
and all balances therein and all proceeds of the foregoing in an amount equal to
such undrawn amount of outstanding Letters of Credit. Cash collateral shall be
maintained in blocked, non-interest bearing deposit accounts at Administrative
Agent. Cash collateral shall be released from such Lien as and to the extent
that Letters of Credit expire or terminate or are drawn upon and reimbursed.
(j) L/C ISSUER REPORTING REQUIREMENTS. Each L/C Issuer shall, no
later than the third (3rd) Business Day following the last day of each month,
provide to Administrative Agent a schedule of the Letters of Credit issued by
it, in form and substance reasonably satisfactory to Administrative Agent,
showing the date of issuance of each Letter of Credit, the account party, the
original face amount (if any), the expiration date, and the reference number of
any Letter of Credit outstanding at any time during such month, and showing the
aggregate amount (if any) payable by Borrower to such L/C Issuer during the such
month pursuant to SECTION 5.4. Promptly after the receipt of such schedule from
each L/C Issuer, Administrative Agent shall provide to Lenders a summary of such
schedules.
2.2 LENDERS; INCREASE IN TOTAL COMMITMENT.
(a) The Lenders on the Closing Date shall be the Lenders set forth
on SCHEDULE 2.1 on the Closing Date.
(b) At any time after the Closing Date through April 7, 2004,
Administrative Agent may, from time to time at the request of Borrower, increase
the Total Commitment by (i) admitting additional Lenders hereunder (each a
"SUBSEQUENT LENDER"), or (ii) increasing the Commitment of any Lender (each an
"INCREASING LENDER"), subject to the following conditions:
(A) each Subsequent Lender is an Eligible Assignee;
(B) each Subsequent Lender executes and delivers to
Administrative Agent a signature page to this
Agreement;
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
23
(C) after giving effect to the admission of any
Subsequent Lender or the increase in the Commitment
of any Increasing Lender, the Total Commitment does
not exceed $350,000,000;
(D) each increase in the Total Commitment shall be in the
amount of $10,000,000 or a greater integral multiple
of $500,000;
(E) no admission of any Subsequent Lender shall increase
the Commitment of any existing Lender without the
written consent of such Lender;
(F) no Potential Default or Event of Default exists;
(G) no Lender shall be an Increasing Lender without the
written consent of such Lender; and
(H) the amount of all increases in the Total Commitment
pursuant to this SECTION 2.2 shall not exceed
$100,000,000 in the aggregate.
After the admission of any Subsequent Lender or the increase in the Commitment
of any Increasing Lender, Administrative Agent shall promptly provide to each
Lender and to Borrower a new SCHEDULE 2.1 to this Agreement. In the event that
there are any Unreimbursed Amounts or Borrowings outstanding after giving effect
to an increase in the Total Commitment pursuant to this SECTION 2.2, upon notice
from Administrative Agent to Lenders, the amount of such Unreimbursed Amounts or
Borrowings owing to each Lender shall be appropriately adjusted to reflect the
new Pro Rata Parts of Lenders, and Borrower shall pay any Consequential Losses
associated therewith pursuant to SECTION 4.5.
2.3 VOLUNTARY TERMINATION OR REDUCTION OF COMMITMENTS. Without
premium or penalty, and upon giving not less than ten (10) Business Days prior
written and irrevocable notice to Administrative Agent, Borrower may permanently
terminate in whole or in part the Total Commitment; provided that: (a) each
partial termination shall be in the amount of $5,000,000 or a greater integral
multiple of $1,000,000; (b) the amount of the Total Commitment may not be
reduced below the Total Outstandings; and (c) each reduction shall be allocated
Pro Rata among Lenders in accordance with their respective Pro Rata Parts.
Promptly after receipt of such notice of termination or reduction,
Administrative Agent shall notify each Lender of the proposed termination or
reduction. Such termination or partial reduction of the Total Commitment shall
be effective on the Business Day specified in Borrower's notice (which date must
be at least ten (10) Business Days after Borrower's delivery of such notice). In
the event that the Total Commitment is reduced to zero and there are no
outstanding Obligations, this Agreement shall be terminated to the extent
specified in SECTION 13.14, and all Letter of Credit fees and other fees then
earned and unpaid hereunder and all other amounts of the Obligation then due and
owing shall be immediately due and payable, without notice or demand by any
Credit Party.
SECTION 3 TERMS OF PAYMENT.
3.1 NOTES AND PAYMENTS.
(a) NOTES. The Credit Extensions made by each Lender shall be
evidenced by one or more accounts or records maintained by such Lender and by
Administrative Agent in the ordinary course of business. The accounts or records
maintained by Administrative Agent and each Lender shall be conclusive absent
manifest error of the amount of the Credit Extensions made by such Lender and
the interest and payments thereon. Any failure to so record or any error in
doing so shall not, however, limit or otherwise affect the obligation of
Borrower hereunder to pay any amount owing with respect to the Obligation. In
the event of any conflict between the accounts and records maintained by any
Lender and
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
24
the accounts and records of Administrative Agent in respect of such matters, the
accounts and records of Administrative Agent shall control in the absence of
manifest error. Upon the request of any Lender made through Administrative
Agent, Borrower shall execute and deliver to such Lender (through Administrative
Agent) a Note, which shall evidence the Borrowings from such Lender in addition
to such accounts or records. Each Lender may attach schedules to its Note and
endorse thereon the date, Type (if applicable), amount and maturity of
Borrowings and payments with respect thereto.
(b) PAYMENTS. Each payment or prepayment on the Obligation is due
and must be paid by Borrower to Administrative Agent at its Payment Office in
Dollars and in immediately available funds, without set-off, deduction, defense,
recoupment, or counterclaim, by 11:00 a.m. on the day due. Payments made after
11:00 a.m. shall be deemed made on the Business Day next following. If any
payment or prepayment on the Obligation is stated to be due on a day that is not
a Business Day, such payment shall be due on the next following Business Day,
and, to the extent applicable, interest and fees shall continue to accrue until
such payment or prepayment is actually made. Administrative Agent shall pay to
each Lender any payment or prepayment to which such Lender is entitled hereunder
on the same day Administrative Agent shall have received the same from Borrower;
provided that such payment or prepayment is received by Administrative Agent
prior to 11:00 a.m., and otherwise before 11:00 a.m. on the Business Day next
following. If and to the extent Administrative Agent shall not make such
payments to Lenders when due as set forth in the preceding sentence, then such
unpaid amounts shall accrue interest, payable by Administrative Agent, at the
Federal Funds Rate from the due date until (but not including) the date on which
Administrative Agent makes such payments to Lenders.
3.2 MANDATORY PAYMENTS.
(a) Each Borrowing is due and payable on the Repayment Date for
such Borrowing.
(b) On any date of determination, if the Total Outstandings exceed
the Total Commitment, then Borrower shall either prepay the Principal Debt
and/or Cash Collateralize or cause to be canceled the undrawn amount of
outstanding Letters of Credit in at least the amount of such excess, together
with (A) all accrued and unpaid interest on the Principal Debt prepaid, and (B)
any Consequential Loss arising as a result thereof.
(c) All mandatory payments pursuant to this SECTION 3.2 shall be
applied to the Principal Debt owing to each Lender according to its Pro Rata
Part except as otherwise specifically provided herein.
3.3 DEFAULT RATE. At the option of Required Lenders at any time
while an Event of Default exists and to the extent permitted by all Legal
Requirements, all past due Principal Debt and all past due accrued interest
thereon, and fees and expenses payable hereunder and under the other Loan
Documents shall bear interest at the Default Rate until paid, regardless whether
such payment is made before or after entry of a judgment.
3.4 INTEREST RECAPTURE. If the designated rate applicable to any
Borrowing exceeds the Maximum Rate, then the rate of interest on such Borrowing
shall be limited to the Maximum Rate, but any subsequent reductions in such
designated rate shall not reduce the rate of interest thereon below the Maximum
Rate until the total amount of interest accrued thereon equals the amount of
interest which would have accrued thereon if such designated rate had at all
times been in effect. In the event that at maturity (stated or by acceleration),
or at final payment of the Total Principal Debt, the total amount of interest
paid or accrued is less than the amount of interest which would have accrued if
such designated
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
25
rates had at all times been in effect, then, at such time and to the extent
permitted by all Legal Requirements, Borrower shall pay an amount equal to the
difference between (a) the lesser of the amount of interest which would have
accrued if such designated rates had at all times been in effect and the amount
of interest which would have accrued if the Maximum Rate had at all times been
in effect, and (b) the amount of interest actually paid or accrued on the Total
Principal Debt.
3.5 INTEREST CALCULATIONS.
(a) All computations of interest for Prime Rate Borrowings shall
be made on the basis of a year of 365 or 366 days, as the case may be, and
actual days elapsed. All other computations of interest shall be calculated on
the basis of actual number of days (including the first (1st) day but excluding
the last day) elapsed but computed as if each calendar year consisted of 360
days. All interest rate determinations and calculations by Administrative Agent
shall be conclusive and binding absent manifest error.
(b) The provisions of this Agreement relating to the calculation
of the Prime Rate and the Adjusted Eurodollar Rate are included only for the
purpose of determining the rate of interest or other amounts to be paid
hereunder that are based upon such rate.
3.6 MAXIMUM RATE. Regardless of any provision contained in any
Loan Document, no Credit Party shall ever be entitled to contract for, charge,
take, reserve, receive, or apply, as interest on the Obligation, or any part
thereof, any amount in excess of the Maximum Rate, and if any Credit Party ever
does so, then such excess shall be deemed a partial prepayment of principal and
treated hereunder as such and any remaining excess shall be refunded to
Borrower. In determining if the interest paid or payable exceeds the Maximum
Rate, Borrower and the Credit Parties shall, to the maximum extent permitted
under all Legal Requirements, (a) treat all Borrowings as but a single extension
of credit (and the Credit Parties and Borrower agree that such is the case and
that provision herein for multiple Borrowings is for convenience only), (b)
characterize any non-principal payment as an expense, fee, or premium rather
than as interest, (c) exclude voluntary prepayments and the effects thereof, and
(d) amortize, prorate, allocate, and spread the total amount of interest
throughout the entire contemplated term of the Obligation; provided that if the
Obligation is paid and performed in full prior to the end of the full
contemplated term thereof, and if the interest received for the actual period of
existence thereof exceeds the Maximum Amount, then the Credit Parties shall
refund such excess, and, in such event, the Credit Parties shall not, to the
extent permitted by all Legal Requirements, be subject to any penalties provided
by any Legal Requirements for contracting for, charging, taking, reserving, or
receiving interest in excess of the Maximum Amount.
3.7 ORDER OF APPLICATION.
(a) Payments and prepayments of the Obligation shall be applied in
the order and manner specified in this Agreement; provided, however, if no order
is otherwise specified and no Potential Default or Event of Default exists,
payments and prepayments of the Obligation shall be applied first, to fees,
second, to accrued interest then due and payable on the Total Principal Debt,
and then to the remaining Obligation in the order and manner as Borrower may
direct.
(b) If a Potential Default or Event of Default exists (or if
Borrower fails to give directions as permitted under SECTION 3.7(a)), any
payment or prepayment (including proceeds from the exercise of any Rights) shall
be applied to the Obligation in the following order: (i) to the ratable payment
of all fees, expenses, and indemnities for which the Credit Parties have not
been paid or reimbursed in accordance
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
26
with the Loan Documents; (ii) to the ratable payment of accrued and unpaid
interest on the Total Principal Debt; (iii) to the ratable payment of the Total
Principal Debt; and (iv) to the payment of the remaining Obligation in the order
and manner Required Lenders deem appropriate.
(c) Subject to the provisions of SECTION 12 and provided that
Administrative Agent shall not in any event be bound to inquire into or to
determine the validity, scope, or priority of any interest or entitlement of any
Credit Party and may suspend all payments or seek appropriate relief (including
instructions from Required Lenders or an action in the nature of interpleader)
in the event of any doubt or dispute as to any apportionment or distribution
contemplated hereby, Administrative Agent shall promptly distribute such amounts
to each Credit Party in accordance with this Agreement and the related Loan
Documents.
3.8 RIGHT OF SET-OFF; ADJUSTMENTS.
(a) SET-OFF. Upon the occurrence and during the continuance of any
Event of Default, each Lender (and each of its Affiliates) is hereby authorized
at any time and from time to time, to the fullest extent permitted by applicable
Legal Requirements, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender (or any of its Affiliates) to or
for the credit or the account of Borrower against any and all of the obligations
of Borrower now or hereafter existing under this Agreement and the Note held by
such Lender, irrespective of whether such Lender shall have made any demand
under this Agreement or such Note and although such obligations may be
unmatured. Each Lender agrees promptly to notify Borrower after any such set-off
and application made by such Lender; provided, however, that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of each Lender under this SECTION 3.8(a) are in addition to other rights
and remedies (including, without limitation, other rights of set-off) that such
Lender may have.
(b) SHARING OF PAYMENTS. If any Lender (a "BENEFITED LENDER")
shall at any time receive any payment of all or part of the Borrowings or
participations in Unreimbursed Amounts owing to it, or interest thereon, or
receive any collateral in respect thereof (whether voluntarily or involuntarily,
by set-off, or otherwise), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of such other
Lender's Borrowings owing to it, or interest thereon, then such Benefited Lender
shall purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Borrowings owing to it, or shall provide
such other Lenders with the benefits of any such collateral, or the proceeds
thereof, as shall be necessary to cause such Benefited Lender to share the
excess payment or benefits of such collateral or proceeds ratably with all
Lenders; provided, however, that if all or any portion of such excess payment or
benefits is thereafter recovered from such Benefited Lender, then such purchase
shall be rescinded, and the purchase price and benefits returned, to the extent
of such recovery, but without interest. Borrower agrees that any Lender so
purchasing a participation from a Lender pursuant to this SECTION 3.8(b) may, to
the fullest extent permitted by applicable Legal Requirements, exercise all of
its rights of payment (including the right of set-off) with respect to such
participation as fully as if such Person were the direct creditor of Borrower in
the amount of such participation.
3.9 BOOKING BORROWINGS. To the extent permitted by all Legal
Requirements, any Lender may make, carry, or transfer its Borrowings at, to, or
for the account of any of its branch offices or the office of any of its
Affiliates; provided that no Affiliate shall be entitled to receive any greater
payment under SECTION 4 than the transferor Lender would have been entitled to
receive with respect to such Borrowings.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
27
SECTION 4 CHANGE IN CIRCUMSTANCES.
4.1 INCREASED COST AND REDUCED RETURN.
(a) CHANGE IN LEGAL REQUIREMENTS. If, after the date hereof, the
adoption of any applicable Legal Requirement, or any change in any applicable
Legal Requirement, or any change in the interpretation or administration thereof
by any Governmental Authority charged with the interpretation or administration
thereof, or compliance by any Lender (or its Applicable Lending Office) with any
request or directive (whether or not having the force of law) of any such
Governmental Authority:
(i) shall subject such Lender (or its Applicable Lending
Office) to any tax, duty, or other charge with respect to any
Eurodollar Borrowing, its Note, any Letter of Credit issued by it or
its obligation to make Eurodollar Borrowings or issue or participate in
Letters of Credit, or change the basis of taxation of any amounts
payable to such Lender (or its Applicable Lending Office) under this
Agreement or its Note in respect of any Eurodollar Borrowings or any
L/C Obligations owing to it (other than taxes imposed on the overall
net income of such Lender by the jurisdiction in which such Lender has
its principal office or such Applicable Lending Office);
(ii) shall impose, modify, or deem applicable any reserve,
special deposit, assessment, or similar requirement (other than the
Reserve Requirement utilized in the determination of the Adjusted
Eurodollar Rate) relating to any extensions of credit or other assets
of, or any deposits with or other liabilities or commitments of, such
Lender (or its Applicable Lending Office), including the Commitment of
such Lender hereunder; or
(iii) shall impose on such Lender (or its Applicable
Lending Office) or the London interbank market any other condition
affecting this Agreement or its Note or any of such extensions of
credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such Lender
(or its Applicable Lending Office) of being obligated to make, making,
Converting into, Continuing, or maintaining any Eurodollar Borrowings or of
issuing Letters of Credit or purchasing or maintaining participations in Letters
of Credit or to reduce any sum received or receivable by such Lender (or its
Applicable Lending Office) under this Agreement or its Note with respect to any
Eurodollar Borrowings or with respect to any L/C Obligations owing to it, then
Borrower shall pay to such Lender on demand such amount or amounts as will
compensate such Lender for such increased cost or reduction. If any Lender
requests compensation by Borrower under this SECTION 4.1(a), then Borrower may,
by notice to such Lender (with a copy to Administrative Agent), suspend the
obligation of such Lender to make or Continue Eurodollar Borrowings, or Convert
all Eurodollar Borrowings into Prime Rate Borrowings, until the event or
condition giving rise to such request ceases to be in effect (in which case the
provisions of SECTION 4.4 shall be applicable); provided that such suspension
shall not affect the Right of such Lender to receive the compensation so
requested.
(b) CAPITAL ADEQUACY. If, after the date hereof, any Lender shall
have determined that the adoption of any applicable Legal Requirement regarding
capital adequacy or any change therein or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof, or any request or directive regarding
capital adequacy (whether or not having the force of law) of any such
Governmental Authority, has or would have the effect of reducing the rate of
return on the capital of such Lender or any corporation controlling such Lender
as a consequence of such
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
28
Lender's obligations hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption, change, request, or
directive (taking into consideration its policies with respect to capital
adequacy), then from time to time upon demand Borrower shall pay to such Lender
such additional amount or amounts as will compensate such Lender for such
reduction.
(c) NOTICE. Each Lender shall promptly notify Borrower and
Administrative Agent of any event of which it has knowledge, occurring after the
date hereof, which will entitle such Lender to compensation pursuant to this
SECTION 4.1 and will use reasonable efforts to designate a different Applicable
Lending Office if such designation will avoid the need for, or reduce the amount
of, such compensation and will not, in the judgment of such Lender, be otherwise
disadvantageous to it. Any Lender claiming compensation under this SECTION 4.1
shall furnish to Borrower and Administrative Agent a statement setting forth the
additional amount or amounts to be paid to it hereunder which shall be
conclusive in the absence of manifest error. In determining such amount, such
Lender may use any reasonable averaging and attribution methods.
4.2 LIMITATION ON TYPES OF BORROWINGS.
If on or prior to the first (1st) day of any Interest Period for any
Eurodollar Borrowing:
(a) Administrative Agent determines (which determination shall be
conclusive) that by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining the Eurodollar Rate
for such Interest Period; or
(b) Required Lenders determine (which determination shall be
conclusive) and notify Administrative Agent that the Adjusted Eurodollar Rate
will not adequately and fairly reflect the cost to Lenders of funding Eurodollar
Borrowings for such Interest Period;
then Administrative Agent shall give Borrower prompt notice thereof specifying
the relevant amounts or periods, and so long as such condition remains in
effect, Lenders shall be under no obligation to make additional Eurodollar
Borrowings, Continue any Eurodollar Borrowings, or to Convert any Prime Rate
Borrowings to Eurodollar Borrowings and Borrower shall, on the last day(s) of
the then-current Interest Period(s) for the outstanding Eurodollar Borrowings,
either prepay such Borrowings or Convert such Borrowings into Prime Rate
Borrowings in accordance with the terms of this Agreement.
4.3 ILLEGALITY. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Lender or its
Applicable Lending Office to make, maintain, or fund Eurodollar Borrowings
hereunder, then such Lender shall promptly notify Administrative Agent and
Borrower thereof and such Lender's obligation to make or Continue Eurodollar
Borrowings and to Convert Prime Rate Borrowings into Eurodollar Borrowings shall
be suspended until such time as such Lender may again make, maintain, and fund
Eurodollar Borrowings (in which case the provisions of SECTION 4.4 shall be
applicable).
4.4 TREATMENT OF AFFECTED LOANS. If the obligation of any Lender
to make or Continue Eurodollar Borrowings or to Convert Prime Rate Borrowings
into Eurodollar Borrowings shall be suspended pursuant to SECTION 4.1, 4.2, or
4.3, then such Lender's Eurodollar Borrowings shall be automatically Converted
into Prime Rate Borrowings on the last day(s) of the then current Interest
Period(s) for all Eurodollar Borrowings (or, in the case of a Conversion
required by SECTION 4.3, on such earlier date as such Lender may specify to
Borrower with a copy to Administrative Agent) and, unless and
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
29
until such Lender gives notice as provided below that the circumstances
specified in SECTION 4.1, 4.2, or 4.3 that gave rise to such Conversion no
longer exist:
(a) to the extent that such Lender's Eurodollar Borrowings have
been so Converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Eurodollar Borrowings shall be applied
instead to its Prime Rate Borrowings; and
(b) all Borrowings that would otherwise be made or Continued by
such Lender as Eurodollar Borrowings shall be made or Continued instead as Prime
Rate Borrowings, and all Borrowings of such Lender that would otherwise be
Converted into Eurodollar Borrowings shall be Converted instead into (or shall
remain as) Prime Rate Borrowings.
If such Lender gives notice to Borrower (with a copy to Administrative Agent)
that the circumstances specified in SECTION 4.1, 4.2, OR 4.3 that gave rise to
the Conversion of such Lender's Eurodollar Borrowings pursuant to this SECTION
4.4 no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when Eurodollar Borrowings made by
other Lenders are outstanding, then such Lender's Prime Rate Borrowings shall be
automatically Converted, on the first (1st) day(s) of the next succeeding
Interest Period(s) for such outstanding Eurodollar Borrowings, to the extent
necessary so that, after giving effect thereto, all Eurodollar Borrowings held
by Lenders are held Pro Rata (as to principal amounts, Types, and Interest
Periods).
4.5 COMPENSATION. Upon the request of any Lender, Borrower shall
pay to such Lender such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss, cost, or
expense (herein called a "CONSEQUENTIAL LOSS") incurred by it as a result of:
(a) any payment, prepayment, or Conversion of a Eurodollar
Borrowing for any reason (including the acceleration of the Obligation pursuant
to SECTION 11.1) on a date other than the last day of the Interest Period for
such Borrowing; or
(b) any failure by Borrower for any reason (including the failure
of any condition precedent specified in SECTION 6 to be satisfied) to Convert,
Continue, or prepay a Eurodollar Borrowing on the date for such Conversion,
Continuation, or prepayment specified in the relevant Notice of Conversion or
Continuation.
4.6 TAXES.
(a) Any and all payments by Borrower to or for the account of any
Credit Party hereunder or under any other Loan Document shall be made free and
clear of and without deduction for any and all present or future Taxes,
excluding, in the case of each Credit Party, Taxes based on or measured by its
income, and franchise taxes imposed on it by the jurisdiction under the Legal
Requirements of which such Credit Party (or its Applicable Lending Office) is
organized or any political subdivision thereof (such income and franchise Taxes
being "EXCLUDED TAXES"). If Borrower shall be required by any Legal Requirement
to deduct any Taxes (other than Excluded Taxes) from or in respect of any sum
payable under this Agreement or any other Loan Document to any Credit Party,
then (i) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this SECTION 4.6) such Credit Party receives an amount equal to
the sum it would have received had no such deductions been made, (ii) Borrower
shall make such deductions, and (iii) Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with all Legal Requirements.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
30
(b) In addition, Borrower agrees to pay any and all present or
future stamp or documentary Taxes and any other excise or property Taxes or
charges or similar levies which arise from any payment made under this Agreement
or any other Loan Document or from the execution or delivery of, or otherwise
with respect to, this Agreement or any other Loan Document (hereinafter referred
to as "OTHER TAXES").
(c) Borrower agrees to indemnify each Credit Party for the full
amount of Taxes (other than Excluded Taxes) and Other Taxes (including any Taxes
or Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this SECTION 4.6) paid by such Credit Party and any liability (including
penalties, interest, and expenses) arising therefrom or with respect thereto.
(d) Each Lender organized under the Legal Requirements of a
jurisdiction outside the United States, on or prior to the date of its execution
and delivery of this Agreement in the case of each Lender listed on the
signature pages hereof and on or prior to the date on which it becomes a Lender
in the case of each other Lender, and from time to time thereafter if requested
in writing by Borrower or Administrative Agent (but only so long as such Lender
remains lawfully able to do so), shall provide Borrower and Administrative Agent
with (i) Internal Revenue Service Form 1001 or 4224, as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying that such
Lender is entitled to benefits under an income tax treaty to which the United
States is a party which reduces the rate of withholding tax on payments of
interest or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United
States, (ii) Internal Revenue Service Form W-8 or W-9, as appropriate, or any
successor form prescribed by the Internal Revenue Service, and (iii) any other
form or certificate required by any taxing authority (including any certificate
required by Sections 871(h) and 881(c) of the Tax Code), certifying that such
Lender is entitled to an exemption from or a reduced rate of tax on payments
pursuant to this Agreement or any of the other Loan Documents.
(e) For any period with respect to which a Lender has failed to
provide Borrower and Administrative Agent with the appropriate form pursuant to
SECTION 4.6(D) (unless such failure is due to a change in any Legal Requirement
occurring subsequent to the date on which a form originally was required to be
provided), such Lender shall not be entitled to indemnification under SECTIONS
4.6(A) or (B) with respect to Taxes imposed by the United States; provided,
however, that should a Lender, which is otherwise exempt from or subject to a
reduced rate of withholding tax, become subject to Taxes (other than Excluded
Taxes) because of its failure to deliver a form required hereunder, Borrower
shall take such steps as such Lender shall reasonably request to assist such
Lender to recover such Taxes.
(f) If Borrower is required to pay additional amounts to or for
the account of any Lender pursuant to this SECTION 4.6, then such Lender will
agree to use reasonable efforts to change the jurisdiction of its Applicable
Lending Office so as to eliminate or reduce any such additional payment which
may thereafter accrue if such change, in the judgment of such Lender, is not
otherwise disadvantageous to such Lender.
(g) Within thirty (30) days after the date of any payment of Taxes
or Other Taxes, Borrower shall furnish to Administrative Agent the original or a
certified copy of a receipt evidencing such payment.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
31
(h) Without prejudice to the survival of any other agreement of
Borrower hereunder, the agreements and obligations of Borrower contained in
SECTIONS 4.1, 4.5, and 4.6 shall survive the termination of the Total Commitment
and the payment in full of the Notes.
SECTION 5 FEES.
5.1 TREATMENT OF FEES. Except as otherwise provided by any Legal
Requirement, the fees described in this SECTION 5: (a) do not constitute
compensation for the use, detention, or forbearance of money; (b) are in
addition to, and not in lieu of, interest and expenses otherwise described in
this Agreement; (c) shall be payable in accordance with SECTION 3.1; (d) shall
be non-refundable; (e) shall, to the fullest extent permitted by all Legal
Requirements, bear interest, if not paid when due, at the Default Rate; and (f)
shall be calculated on the basis of actual number of days (including the first
day but excluding the last day) elapsed, but computed as if each calendar year
consisted of 360 days.
5.2 FEES OF ADMINISTRATIVE AGENT. Borrower shall pay to
Administrative Agent the fees specified in the letter agreement dated May 29,
2003 between Administrative Agent and Borrower, as amended, which fees shall be
for the account of Administrative Agent and for the account of the Credit
Parties as shall be agreed between Administrative Agent and each other Credit
Party.
5.3 LETTER OF CREDIT FEES. Borrower shall pay to Administrative
Agent for the account of the Lenders in accordance with their respective Pro
Rata Parts a Letter of Credit fee for each outstanding Letter of Credit equal to
a rate per annum equal to the Applicable Margin for Letters of Credit times the
daily maximum amount available to be drawn under such Letter of Credit (whether
or not such maximum amount is then in effect under such Letter of Credit). Such
Letter of Credit fees shall accrue and be computed on a quarterly basis in
arrears, and shall be due and payable on the fifteenth (15th) day after the end
of each March, June, September, and December, commencing with the first such
date to occur after the issuance of such Letter of Credit, on the Letter of
Credit Expiration Date and thereafter on demand. If there is any change in the
Applicable Margin during any quarter, the daily maximum amount of each Letter of
Credit shall be computed and multiplied by the Applicable Margin separately for
each period during such quarter that such Applicable Margin was in effect.
5.4 FRONTING FEE AND DOCUMENTARY AND PROCESSING CHARGES PAYABLE TO
L/C ISSUER. Borrower shall pay directly to the applicable L/C Issuer for its own
account a fronting fee with respect to each Letter of Credit issued or renewed
by such L/C Issuer equal to the greater of (a) $1,500 and (b) (i) 0.125% per
annum times (ii) the aggregate maximum amount which is available to be drawn
under such Letter of Credit. Such fronting fee shall be due and payable on the
fifteenth (15th) day after the end of each March, June, September, and December,
commencing with the first such date to occur after the issuance or renewal of
such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on
demand. In addition, Borrower shall pay directly to the applicable L/C Issuer
for its own account the customary issuance, presentation, amendment, and other
processing fees, and other standard costs and charges, of such L/C Issuer
relating to letters of credit as from time to time in effect. Such customary
fees and standard costs and charges are due and payable on demand and are
nonrefundable.
5.5 UNUSED FEE. For the period from the Closing Date to the
Termination Date, Borrower shall pay to Administrative Agent, for the ratable
benefit of Lenders, an unused fee, calculated daily but payable quarterly in
installments in arrears, on the fifteenth (15th) day after the end of each
March, June, September, and December and on the Termination Date, commencing
September 30, 2003. Each installment shall be in an amount equal to the product
of (a) the rate per annum equal to the Applicable
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
32
Margin for Unused Fees times (b) the actual daily amount by which the Total
Commitment exceeds Total Outstandings.
SECTION 6 CONDITIONS PRECEDENT.
6.1 CONDITIONS PRECEDENT TO CLOSING. This Agreement shall not
become effective unless the following conditions precedent are satisfied on or
before the Closing Date:
(a) BORROWER DOCUMENTS. Borrower shall deliver or cause to be
delivered to Administrative Agent the following, each, unless otherwise noted,
dated as of the Closing Date:
(i) certified copies of its Constituent Documents,
together with existence and good standing certificates from the
Secretary of State of Nevada and foreign qualification and good
standing certificates from the State of Texas, each dated a recent date
prior to the Closing Date;
(ii) a certificate of Responsible Officers of Borrower
certifying (A) its Constituent Documents, (B) resolutions of its Board
of Directors (or of the "Executive Committee" of the Board of Directors
upon delivery of resolutions of the Board of Directors authorizing such
action by an Executive Committee) approving and authorizing the
execution, delivery, and performance of this Agreement and the other
Loan Documents, certified as of the Closing Date as being in full force
and effect without modification or amendment, and (C) signatures and
incumbency of its officers executing this Agreement and the other Loan
Documents;
(iii) executed originals of this Agreement, the Notes, if
any, and the other Loan Documents to be executed by Borrower; and
(iv) such other documents as Administrative Agent may
reasonably request.
(b) OPINION OF COUNSEL FOR BORROWER. The Credit Parties and their
respective counsel shall have received originally executed copies of a favorable
written opinion of counsel for Borrower, in form and substance reasonably
satisfactory to Administrative Agent and its counsel, dated as of the Closing
Date, and setting forth substantially the matters in the opinions designated in
EXHIBIT D.
(c) FEES. Borrower shall have paid to Administrative Agent, (i)
for distribution (as appropriate) to the Credit Parties, the fees payable on the
Closing Date referred to in SECTION 5.2, and (ii) all reasonable fees and
expenses incurred by Administrative Agent and Arranger in connection with the
negotiation, preparation, and closing of the transactions evidenced by the Loan
Documents (including, without limitation, Attorney Costs).
(d) COMPLETION OF PROCEEDINGS. All corporate and other proceedings
taken or to be taken in connection with the transactions contemplated hereby and
all documents incidental thereto not previously found acceptable by
Administrative Agent, acting on behalf of Lenders, and its counsel shall be
satisfactory in form and substance to Administrative Agent and such counsel, and
Administrative Agent and such counsel shall have received all such counterpart
originals or certified copies of such documents as Administrative Agent may
reasonably request.
6.2 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligations of the
Credit Parties to make each Credit Extension (including the initial Credit
Extension) are subject to the following further conditions precedent:
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
33
(a) NOTICE OF CREDIT EXTENSION. Administrative Agent and the
applicable L/C Issuer shall have received, in accordance with the provisions of
SECTION 2.1, an originally executed Letter of Credit Application or Notice of
Conversion/Continuation, as applicable.
(b) REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF AGREEMENTS. As
of the date of such Credit Extension, Borrower's representations and warranties
in each Loan Document are true, correct, and complete in all material respects
(unless they speak to a specific date or are based on facts which have changed
by transactions expressly contemplated or permitted by this Agreement).
(c) NO DEFAULT. No Potential Default or Event of Default exists or
would be caused by the making of such Credit Extension.
(d) NO INJUNCTION OR RESTRAINING ORDER. No order, judgment, or
decree of any Governmental Authority shall purport to enjoin or restrain any
Credit Party from making such Credit Extension.
(e) NO VIOLATION. The making of such Credit Extension shall not
violate any Legal Requirement, including Regulation T, Regulation U, or
Regulation X of the Board of Governors of the Federal Reserve System.
(f) OTHER MATTERS. All matters related to such Credit Extension
must be satisfactory to Required Lenders and their respective counsel in their
reasonable determination, and upon the reasonable request of Administrative
Agent, Borrower shall deliver to Administrative Agent evidence substantiating
any of the matters in the Loan Documents which are necessary to enable Borrower
to qualify for such Credit Extension.
Each condition precedent in this Agreement is material to the transactions
contemplated in this Agreement, and time is of the essence in respect of each
thereof. Subject to the prior approval of Required Lenders, the Credit Parties
may make a Credit Extension without all conditions being satisfied, but, to the
extent permitted by all Legal Requirements, such Credit Extension shall not be
deemed to be a waiver of the requirement that each such condition precedent be
satisfied as a prerequisite for any subsequent Credit Extension, unless Required
Lenders specifically waive each such item in writing.
SECTION 7 REPRESENTATIONS AND WARRANTIES.
Borrower represents and warrants to the Credit Parties as follows:
7.1 PURPOSE OF LETTER OF CREDIT FACILITY. Borrower will use (or
will loan or contribute such proceeds to its Subsidiaries to so use) all
proceeds of Credit Extensions for one or more of the following: (a) for lawful,
corporate purposes; and (b) to satisfy its insurance bonding requirements. No
Restricted Company is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying any "margin stock" within the meaning of Regulation U. No part of the
proceeds of any Credit Extension will be used, directly or indirectly, for a
purpose which violates any Legal Requirement, including the provisions of
Regulation T, U, or X (as enacted by the Board of Governors of the Federal
Reserve System, as amended). "Margin Stock" (as defined in Regulation U)
constitutes less than twenty-five percent (25%) of those assets of the Companies
that are subject to any limitation on sale, pledge, or similar restrictions
hereunder.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
34
7.2 EXISTENCE, GOOD STANDING, AUTHORITY, AND AUTHORIZATIONS. Each
Restricted Company is duly organized, validly existing, and in good standing
under the Legal Requirements of its jurisdiction of organization. Each
Restricted Company is duly qualified to transact business and is in good
standing in each jurisdiction where the nature and extent of its business and
properties require the same, except where the failure to be so qualified could
not constitute a Material Adverse Event. Each Restricted Company possesses all
the Authorizations necessary or required in the conduct of its respective
business(es), and the same are valid, binding, enforceable, and subsisting
without any defaults thereunder or enforceable adverse limitations thereon and
are not subject to any proceedings or claims opposing the issuance, development,
or use thereof or contesting the validity thereof, except for any such
circumstance that could not be a Material Adverse Event.
7.3 SUBSIDIARIES; CAPITAL STOCK. The Companies have no
Subsidiaries except as disclosed on SCHEDULE 7.3, such schedule reflecting each
Subsidiary's jurisdiction of incorporation (as supplemented and modified in
writing from time to time to reflect any changes to such SCHEDULE as a result of
transactions permitted or not prohibited by the Loan Documents) and each
Unrestricted Subsidiary is designated as such. All of the outstanding Stock of
each Subsidiary is duly authorized, validly issued, fully paid, and
nonassessable and, except (a) for directors' qualifying shares, or (b) as
otherwise set forth on SCHEDULE 7.3, are owned directly or indirectly by
Borrower (as supplemented and modified in writing from time to time to reflect
any changes to such SCHEDULE as a result of transactions permitted or not
prohibited by the Loan Documents), free and clear, in the case of all Restricted
Subsidiaries, of any Liens, restrictions (including restrictions on transfer),
claims, or Rights of another Person except for restrictions on transfer imposed
by securities Legal Requirements and general corporate Legal Requirements.
7.4 AUTHORIZATION AND CONTRAVENTION. The execution and delivery by
Borrower of each Loan Document and the performance by Borrower of its
obligations thereunder (a) are within the corporate power of Borrower, (b) have
been duly authorized by all necessary corporate action on the part of Borrower,
(c) require no action by or in respect of Authorizations of or filing with, any
Governmental Authority, which action, Authorization, or filing has not been
taken, received, or made on or prior to the Closing Date (or if later, the date
of execution and delivery of such Loan Document) other than filing of the Loan
Documents pursuant to securities Legal Requirements, (d) will not violate any
provision of the Constituent Documents of any Company, (e) will not violate any
provision of any Legal Requirement applicable to any Company, other than such
violations which individually or collectively could not be a Material Adverse
Event, (f) will not violate any material written or oral agreements, contracts,
commitments, or understandings to which any Company is a party, other than such
violations which could not be a Material Adverse Event, or (g) will not result
in the creation or imposition of any Lien on any asset of any Company.
7.5 BINDING EFFECT. Upon execution and delivery by all parties
thereto, each Loan Document to which Borrower is a party will constitute a
legal, valid, and binding obligation of Borrower, enforceable against Borrower
in accordance with its terms, except as enforceability may be limited by
applicable Debtor Relief Laws and general principles of equity.
7.6 FINANCIAL STATEMENTS. The Current Financials were prepared in
accordance with GAAP and present fairly, in all material respects, the
consolidated financial condition, results of operations, and cash flows of the
Companies as of and for the portion of the fiscal year ending on the date or
dates thereof (subject only to normal year-end audit adjustments). There were no
material liabilities, direct or indirect, fixed or contingent, of the Companies
as of the date or dates of the Current Financials which are required
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
35
under GAAP to be reflected therein or in the notes thereto, and are not so
reflected. No Material Adverse Event has occurred from March 31, 2003 to the
Closing Date.
7.7 LITIGATION, CLAIMS, INVESTIGATIONS. No Company is subject to,
or aware of the threat of, any Litigation which is reasonably likely to be
determined adversely to any Company, and, if so adversely determined, could
(individually or collectively with other Litigation) be a Material Adverse
Event. There are no outstanding orders or judgments for the payment of money in
excess of $20,000,000 (individually or collectively) or any warrant of
attachment, sequestration, or similar proceeding against the assets of any
Company having a value (individually or collectively) of $20,000,000 or more
which is not either (a) stayed on appeal, or (b) being contested in good faith
by appropriate proceedings diligently conducted, and against which reserves or
other provisions required by GAAP have been made. There are no formal
complaints, suits, claims, investigations, or proceedings initiated at or by any
Governmental Authority pending or, to the best knowledge of Borrower, threatened
against any Company which is reasonably likely to be determined adversely and,
if so adversely determined, could be a Material Adverse Event, nor any
judgments, decrees, or orders of any Governmental Authority outstanding against
any Company that could be a Material Adverse Event.
7.8 TAXES. All Tax returns of each Company required to be filed
have been filed (or extensions have been granted) prior to delinquency, except
for any such returns for which the failure to so file could not be a Material
Adverse Event, and all Taxes imposed upon each Company which are due and payable
have been paid prior to delinquency, other than Taxes (a) that are being
contested in good faith by appropriate proceedings diligently conducted, and
against which reserves or other provisions required by GAAP have been made, or
(b) for which nonpayment thereof could not be a Material Adverse Event.
7.9 ENVIRONMENTAL MATTERS. No Company, after reasonable inquiry,
(a) knows of any environmental condition or circumstance, such as the presence
or Release of any Hazardous Materials, on any property presently or previously
owned or leased by any Company or to which Hazardous Materials generated by any
Company have been taken, that could be a Material Adverse Event, (b) knows of
any violation by any Company of any Environmental Law that could be a Material
Adverse Event, or (c) knows that any Company is under any obligation to remedy
any violation of any Environmental Law or any Release or threatened Release of
any Hazardous Materials that could be a Material Adverse Event.
7.10 EMPLOYEE BENEFIT PLANS. (a) No Employee Plan has incurred an
accumulated funding deficiency, as defined in Section 302 of ERISA and Section
412 of the Tax Code, (b) neither Borrower nor any ERISA Affiliate has incurred a
liability which is currently due and remains unpaid under Title IV of ERISA to
the PBGC or to an Employee Plan in connection with any such Employee Plan, (c)
neither Borrower nor any ERISA Affiliate has withdrawn in whole or in part from
participation in a Multiemployer Plan, (d) Borrower has not engaged in any
"prohibited transaction" (as defined in Section 406 of ERISA or Section 4975 of
the Tax Code), and (e) no Reportable Event has occurred which is reasonably
likely to result in the termination of an Employee Plan if such accumulated
funding deficiency, liability, withdrawal, prohibited transaction, or Reportable
Event is reasonably likely to result individually or in the aggregate in
liability on the part of Borrower in excess of $20,000,000. The present value of
all benefit liabilities within the meaning of Title IV of ERISA under each
Employee Plan (based on those actuarial assumptions used to fund such Employee
Plan) did not, as of the last annual valuation date for the most recent plan
year of such Employee Plan, exceed the value of the assets of such Employee
Plan, and the total present values of all benefit liabilities within the meaning
of Title IV of ERISA of all Employee Plans (based on the actuarial assumptions
used to fund each such Employee Plan) did not, as of the respective annual
valuation dates for the most recent plan year of each such Plan, exceed the
value of the assets of all such Employee Plans.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
36
7.11 PROPERTIES; LIENS. Each Restricted Company has good and
indefeasible title to all its property reflected on the Current Financials,
except for property that (a) is obsolete, or (b) has been disposed of in the
ordinary course of business or as otherwise permitted by the Loan Documents.
Except for Permitted Liens, there is no Lien on any property of any Restricted
Company.
7.12 GOVERNMENT REGULATIONS. No Company is subject to regulation
under the Investment Company Act of 1940, as amended, the Public Utility Holding
Company Act of 1935, as amended, or any other Legal Requirement (other than
Regulations T, U, and X of the Board of Governors of the Federal Reserve System)
which regulates the incurrence of Debt.
7.13 TRANSACTIONS WITH AFFILIATES. No Restricted Company is a party
to a transaction with any of its Affiliates, other than transactions upon fair
and reasonable terms not materially less favorable than such Restricted Company
could obtain or could become entitled to in an arm's-length transaction with a
Person that was not its Affiliate.
7.14 NO DEFAULT. No event has occurred and is continuing or would
result from the incurring of obligations by Borrower under this Agreement or any
other Loan Document which constitutes an Event of Default or a Potential
Default. No Restricted Company is in default under or with respect to any
material written or oral agreements, contracts, commitments, or understandings
to which any Restricted Company is party which could, individually or together
with all such defaults, be a Material Adverse Event.
7.15 SOLVENCY. At the time of each Credit Extension hereunder, each
Restricted Company is (and after giving effect to the transactions contemplated
by the Loan Documents and any incurrence of additional Debt, will be) Solvent.
7.16 COMPLIANCE WITH LEGAL REQUIREMENTS. No Company is in violation
of any Legal Requirements (including Environmental Laws), other than such
violations which could not, individually or collectively, be a Material Adverse
Event. No Company has received notice alleging any non-compliance with any Legal
Requirements, except for such non-compliance which no longer exists or which
could not be a Material Adverse Event.
7.17 FULL DISCLOSURE. There is no material fact or condition
relating to the Loan Documents or the financial condition, business, or property
of any Company which could be a Material Adverse Event and which has not been
disclosed, in writing, to Administrative Agent. All information heretofore
furnished by any Company to any Credit Party in connection with the Loan
Documents was, and all such information hereafter furnished by any Company to
any Credit Party will be, true and accurate in all material respects or based on
reasonable estimates on the date as of which such information is stated or
certified.
7.18 SENIOR DEBT. The Obligation constitutes (and will constitute
until payment in full and cancellation of all Commitments hereunder) Borrower's
direct and unconditional obligation and ranks at least pari passu with other
unsecured and unsubordinated Debt of Borrower.
7.19 TAX SHELTER REGULATIONS. Borrower does not intend to treat the
Borrowings and related transactions as being a "reportable transaction" (within
the meaning of Treasury Regulation Section 1.6011-4). In the event Borrower
determines to take any action inconsistent with such intention, it will promptly
notify Administrative Agent thereof. If Borrower so notifies Administrative
Agent,
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
37
Borrower acknowledges that one or more Lenders may treat its Credit Extensions
as part of a transaction that is subject to Treasury Regulation Section
301.6112-1, and such Lender or Lenders, as applicable, will maintain the lists
and other records required by such Treasury Regulation.
SECTION 8 AFFIRMATIVE COVENANTS.
Borrower covenants and agrees to perform, observe, and comply with each
of the following covenants, from the Closing Date and so long thereafter as
Lenders are committed to make any Credit Extensions under this Agreement and
thereafter until the payment in full of all Principal Debt, all L/C Obligations,
and payment in full of all interest, fees, and other amounts of the Obligation
then due and owing, unless Borrower receives a prior written consent to the
contrary by Administrative Agent as authorized by Required Lenders:
8.1 USE OF PROCEEDS. Borrower shall use the proceeds of all Credit
Extensions only for the purposes represented herein.
8.2 BOOKS AND RECORDS. Borrower shall, and shall cause each other
Company to, maintain books, records, and accounts necessary to prepare all
Financial Statements delivered hereunder in accordance with GAAP.
8.3 ITEMS TO BE FURNISHED. Borrower shall cause the following to
be furnished to Administrative Agent and each Lender:
(a) ANNUAL FINANCIAL STATEMENTS. Promptly after preparation, and
no later than one hundred and twenty (120) days after the last day of each
fiscal year of Borrower, Financial Statements showing the consolidated and
consolidating financial condition and results of operations of the Companies, as
of, and for the year ended on, such day, each accompanied by:
(i) with respect to the consolidated Financial
Statements, the unqualified opinion of a firm of nationally-recognized
independent certified public accountants, based on an audit using
generally accepted auditing standards, that such Financial Statements
were prepared in accordance with GAAP and present fairly the
consolidated financial condition and results of operations of the
Companies;
(ii) any management letter delivered to Borrower prepared
by such accounting firm with respect to such Financial Statements; and
(iii) a Compliance Certificate.
(b) PERIODIC FINANCIAL STATEMENTS. Promptly after preparation, and
no later than sixty (60) days after the last day of each fiscal quarter of
Borrower (other than the last fiscal quarter of any fiscal year), Financial
Statements showing the consolidated and consolidating financial condition and
results of operations calculated for the Companies for such fiscal quarter and
for the period from the beginning of the then-current fiscal year to such last
day, accompanied by (i) an internally prepared financial summary of the
Companies and other information as Administrative Agent may reasonably request,
and (ii) a Compliance Certificate with respect to such Financial Statements.
(c) MANAGEMENT LETTERS. Promptly upon receipt thereof, copies of
all auditor's annual management letters delivered to Borrower.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
38
(d) NOTICES OF LITIGATION, DEFAULTS, ETC. Notice, promptly after
Borrower knows or has reason to know of (i) the existence and status of any
Litigation which is reasonably likely to be determined adversely and, if so
adversely determined, could be a Material Adverse Event, or of any order or
judgment for the payment of money which (individually or collectively) is in
excess of $20,000,000, or any warrant of attachment, sequestration, or similar
proceeding against the assets of any Company having a value (individually or
collectively) of $20,000,000 or more, (ii) any material change in any material
fact or circumstance represented or warranted in any Loan Document, (iii) a
Potential Default or Event of Default specifying the nature thereof and what
action Borrower or any other Company has taken, is taking, or proposes to take
with respect thereto; provided, however, that Borrower shall have no obligation
to notify Administrative Agent or Lenders of a Potential Default under SECTION
9.12 unless Borrower has actual knowledge of such Potential Default and such
Potential Default has continued, or Borrower reasonably expects such Potential
Default to continue, for a period of five (5) consecutive days, (iv) the receipt
by any Company of any notice from any Governmental Authority of the expiration
without renewal, termination, material modification or suspension of, or
institution of any proceedings to terminate, materially modify, or suspend, any
Authorization which any Company is required to hold in order to operate its
business in compliance with all Legal Requirements, other than such expirations,
terminations, suspensions, or modifications which individually or in the
aggregate would not be a Material Adverse Event, (v) any federal, state, or
local statute, regulation, or ordinance or judicial or administrative order
limiting or controlling the operations of any Company which has been issued or
adopted hereafter and which is of material adverse importance or effect in
relation to the operations of the Companies taken as a whole, (vi) the receipt
by any Company of notice of any violation or alleged violation of any
Environmental Law, which violation or alleged violation could individually or
collectively with other such violations or allegations, reasonably be expected
to be a Material Adverse Event, or (vii) (A) the occurrence of a Reportable
Event that, alone or together with any other Reportable Event, could reasonably
be expected to result in liability of any Company to the PBGC in an aggregate
amount exceeding $20,000,000; (B) any expressed statement in writing on the part
of the PBGC of its intention to terminate any Employee Plan or Plans; (C)
Borrower's or an ERISA Affiliate's becoming obligated to file with the PBGC a
notice of failure to make a required installment or other payment with respect
to an Employee Plan; or (D) the receipt by Borrower or an ERISA Affiliate from
the sponsor of a Multiemployer Plan of either a notice concerning the imposition
of withdrawal liability in an aggregate amount exceeding $20,000,000 or of the
impending termination or reorganization of such Multiemployer Plan.
(e) SCHEDULE AND EXHIBIT UPDATES. Concurrently with the delivery
of each Compliance Certificate, to the extent any of the information or
disclosures provided on any of the SCHEDULES or EXHIBITS delivered pursuant to
this Agreement or any Loan Documents has become outdated or incorrect in any
material respect, such revised or updated SCHEDULES or EXHIBITS as may be
necessary or appropriate to update or correct such information or disclosures.
(f) SEC FILINGS. Promptly after the filing thereof, a true,
correct, and complete copy of each Form 10-K, Form 10-Q, and Form 8-K filed by
or on behalf of Borrower with the Securities and Exchange Commission.
(g) CHANGE IN RATINGS. Promptly upon the receipt of notice
thereof, and in any event within three (3) Business Days after any change in the
Moody's Rating or the S & P Rating, notice of such change.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
39
(h) TAX SHELTER REGULATIONS. Promptly after Borrower has notified
Administrative Agent of any intention by Borrower to treat the Borrowings and
related transactions as being a "reportable transaction" (within the meaning of
Treasury Regulation Section 1.6011-4), a duly completed copy of IRS Form 8886 or
any successor form.
(i) OTHER INFORMATION. Promptly upon request therefor by any
Credit Party, such information (not otherwise required to be furnished under the
Loan Documents) respecting the business affairs, assets, and liabilities of the
Companies, as reasonably requested.
8.4 INSPECTIONS. Borrower shall, and shall cause each other
Company to, upon reasonable notice, allow any Credit Party (or its
Representatives) (except in the case of Administrative Agent or its
Representatives or unless an Event of Default then exists (which in either case
shall be at the expense of Borrower), at the sole expense of such Credit Party)
to inspect any of their properties, to review reports, files, and other records
and to make and take away copies thereof, to conduct tests or investigations,
and to discuss any of their affairs, conditions, and finances with other
creditors, directors, officers, employees, other representatives, and
independent accountants of the Companies, from time to time, during reasonable
business hours.
8.5 TAXES. Borrower shall, and shall cause each other Company to
(a) promptly pay when due any and all Taxes other than Taxes the failure to pay
could not be a Material Adverse Event or the applicability, amount, or validity
of which is being contested in good faith by appropriate proceedings diligently
conducted, and against which reserves or other provisions required by GAAP have
been made, and in respect of which levy and execution of any lien securing same
have been and continue to be stayed, and (b) notify Administrative Agent
immediately if the Internal Revenue Service or any other taxing authority
commences or notifies any Company of its intention to commence an audit or
investigation with respect to any Taxes of any kind due or alleged to be due
from any Company to the extent that the failure to pay such Taxes could be a
Material Adverse Event.
8.6 PAYMENT OF OBLIGATIONS. Borrower shall pay the Obligation in
accordance with the terms and provisions of the Loan Documents. Borrower shall,
and shall cause each Restricted Company to, promptly pay (or renew and extend)
all of its material obligations as the same become due (unless such obligations
(other than the Obligation) are being contested in good faith by appropriate
proceedings).
8.7 MAINTENANCE OF EXISTENCE, ASSETS, AND BUSINESS. Except as
otherwise permitted by SECTION 9.10, Borrower shall, and shall cause each other
Company to, at all times: (a) maintain its existence and good standing in the
jurisdiction of its organization and its authority to transact business in all
other jurisdictions where the failure to so maintain could be a Material Adverse
Event; (b) maintain all licenses, permits, and franchises necessary for its
business where the failure to so maintain could be a Material Adverse Event; (c)
keep all of its assets which are useful in and necessary to its business in good
working order and condition (ordinary wear and tear excepted) and make all
necessary repairs thereto and replacements thereof where the failure to do so
could be a Material Adverse Event; and (d) do all things necessary to obtain,
renew, extend, and continue in effect all Authorizations which may at any time
and from time to time be necessary for the Companies to operate their businesses
in compliance with all Legal Requirements, where the failure to so obtain,
renew, extend, or continue in effect could be a Material Adverse Event.
8.8 INSURANCE. Borrower shall, and shall cause each other Company
to, maintain with financially sound, responsible, and reputable insurance
companies or associations insurance reasonably acceptable to Administrative
Agent concerning its properties and businesses against casualties and
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
40
contingencies and of types and in amounts (and with co-insurance and
deductibles) as is customary in the case of similar businesses. At
Administrative Agent's request, Borrower shall, and shall cause each other
Company to, promptly deliver to Administrative Agent evidence of insurance for
each policy of insurance and evidence of payment of all premiums.
8.9 PRESERVATION AND PROTECTION OF RIGHTS. Borrower shall, and
shall cause each other Company to, perform such acts and duly authorize,
execute, acknowledge, deliver, file, and record any additional agreements,
documents, instruments, and certificates as Administrative Agent or Required
Lenders may reasonably deem necessary or appropriate in order to preserve and
protect the Rights of the Credit Parties under any Loan Document.
8.10 ENVIRONMENTAL LAWS. Borrower shall, and shall cause each other
Company to (a) conduct its business so as to comply with all applicable
Environmental Laws and shall promptly take corrective action to remedy any
non-compliance with any Environmental Law, and (b) promptly investigate and
remediate any known Release or threatened Release of any Hazardous Material on
any property owned by any Company or at any facility operated by any Company to
the extent and degree necessary to comply with all Environmental Laws, except,
in the cases of CLAUSES (A) and (B), to the extent that the failure to do so
could not be a Material Adverse Event.
8.11 COMPLIANCE WITH LEGAL REQUIREMENTS. Borrower shall, and shall
cause each other Company to, comply with the provisions of all Legal
Requirements applicable to it, and any material written or oral agreement,
contract, commitment, or understanding to which it is a party, unless the
failure to so comply alone, or when aggregated with all other such
non-compliance, could not be a Material Adverse Event.
8.12 DESIGNATION OF UNRESTRICTED SUBSIDIARIES
(a) Borrower shall have the option of designating any Restricted
Subsidiary as an Unrestricted Subsidiary by giving prior written notice to the
Administrative Agent and Lenders (as provided in the next sentence), provided
that (i) such designation does not result in an Event of Default or a Potential
Default, and (ii) the aggregate of (x) the Recourse Debt of such Restricted
Subsidiary (determined as at the date of such designation), and (y) the
aggregate Recourse Debt of all other Subsidiaries of Borrower, if any, which
Borrower has previously designated as Unrestricted Subsidiaries (determined for
each such other Subsidiary as at the date of designation of the new Unrestricted
Subsidiary and determined for all such Subsidiaries (including the new
Unrestricted Subsidiary) on a consolidated basis in accordance with GAAP) does
not exceed the greater of (a) twenty-five percent (25%) of Consolidated Debt
(determined as at the date of such designation) excluding the Restricted
Subsidiary to be so designated, or (b) $500,000,000. Each notice of designation
delivered pursuant to the preceding sentence shall be accompanied by the
following documents, each certified by a Responsible Officer of Borrower and
setting forth the relevant financial information as at a specified date not
earlier than ten (10) days before the effective date of such designation: (X) a
statement showing, in reasonable detail, the Tangible Net Worth, the total Debt,
and the total assets of each Restricted Subsidiary the subject of such notice of
designation; and (Y) a Compliance Certificate showing comparative figures for
Borrower and the Restricted Subsidiaries before and after giving effect to such
notice of designation and a statement demonstrating, in reasonable detail,
compliance with CLAUSE (ii) of the first sentence of this SECTION 8.12(a). Any
attempted designation by Borrower of a Restricted Subsidiary as an Unrestricted
Subsidiary other than in compliance with the limitations contained in this
SECTION 8.12(a) shall be ineffective as fully as if such attempted designation
had never occurred.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
41
(b) Borrower shall have the option of designating any newly formed
or acquired Subsidiary as an Unrestricted Subsidiary so long as such designation
complies with the requirements of the proviso in the first sentence of SECTION
8.12(a) and Administrative Agent receives a list of newly formed or acquired
Unrestricted Subsidiaries in connection with the delivery of each Compliance
Certificate delivered to Administrative Agent pursuant to SECTION 8.3, which
Compliance Certificate shall contain a statement that Borrower is in compliance
with CLAUSE (ii) of the first sentence of SECTION 8.12(a) (for such purpose the
reference to "Restricted Subsidiary" in CLAUSE (ii) of the first sentence of
SECTION 8.12(a) shall be deemed to read "newly formed or acquired Subsidiary").
(c) If, as of any date, the aggregate Recourse Debt of the
Unrestricted Subsidiaries (determined on a consolidated basis in accordance with
GAAP) exceeds the greater of (a) twenty-five percent (25%) of Consolidated Debt
as of such date or (b) $500,000,000, then Borrower shall designate an
Unrestricted Subsidiary or Subsidiaries to be a Restricted Subsidiary such that
the aggregate Recourse Debt of the remaining Unrestricted Subsidiaries does not
exceed the greater of (a) twenty-five percent (25%) of Consolidated Debt
(including the newly designated Restricted Subsidiary), or (b) $500,000,000.
Borrower shall notify Administrative Agent and Lenders of any such designation
not later than ten (10) days after the requirement to make such designation
arises pursuant to the preceding sentence, accompanied by the following
documents, each certified by a Responsible Officer of Borrower and setting forth
the relevant financial information as at a specified date not earlier than ten
(10) days before the effective date of such designation: (X) a statement
showing, in reasonable detail, the Tangible Net Worth, the total Debt, and the
total assets of the Subsidiary to be designated a Restricted Subsidiary, and (Y)
a Compliance Certificate showing comparative figures for Borrower and the
Restricted Subsidiaries before and after giving effect to such notice of
designation and a statement demonstrating, in reasonable detail, compliance with
this SECTION 8.12(c).
SECTION 9 NEGATIVE COVENANTS.
Borrower covenants and agrees to perform, observe, and comply with each
of the following covenants, from the Closing Date and so long thereafter as
Lenders are committed to make any Credit Extensions under this Agreement and
thereafter until the payment in full of all Principal Debt, all L/C Obligations,
and payment in full of all other interest, fees, and other amounts of the
Obligation then due and owing, unless Borrower receives a prior written consent
to the contrary by Administrative Agent as authorized by Required Lenders (or
all Lenders, in the case of SECTION 9.6):
9.1 EMPLOYEE BENEFIT PLANS. Borrower shall not, and shall not
permit any ERISA Affiliate to, directly or indirectly, engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the Tax
Code), and the Companies and their respective ERISA Affiliates shall not,
directly or indirectly, (a) incur any "accumulated funding deficiency" as such
term is defined in Section 302 of ERISA with respect to any Employee Plan, (b)
permit any Employee Plan to be subject to involuntary termination proceedings
pursuant to Title IV of ERISA, or (c) fully or partially withdraw from any
Multiemployer Plan, if such prohibited transaction, accumulated funding
deficiency, termination proceeding, or withdrawal would result individually or
in the aggregate in liability on the part of Borrower in excess of $20,000,000.
9.2 LIENS. Borrower shall not, and shall not permit any other
Restricted Company to, directly or indirectly, (a) create, incur, or suffer or
permit to be created or incurred or to exist any Lien upon any Stock of any
Restricted Subsidiary (other than Stock not owned by a Company), or (b) create,
incur, or suffer or permit to be created or incurred or to exist any Lien upon
any of its other assets, except in the case of CLAUSE (b):
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42
(i) pledges or deposits made to secure payment of worker's
compensation, or to participate in any fund in connection with worker's
compensation, unemployment insurance, pensions, or other social security
programs;
(ii) good-faith pledges or deposits made to secure performance of
bids, tenders, insurance or other contracts (other than for the repayment of
borrowed money), or leases, or to secure statutory obligations, surety or appeal
bonds, or indemnity, performance, or other similar bonds as all such Liens arise
in the ordinary course of business of the Restricted Companies;
(iii) encumbrances consisting of zoning restrictions, easements, or
other restrictions on the use of real property, none of which impair in any
material respect the use of such property by the Person in question in the
operation of its business, and none of which is violated by existing or proposed
structures or land use;
(iv) Liens of landlords or of mortgagees of landlords, arising
solely by operation of law, on fixtures and movable property located on premises
leased in the ordinary course of business;
(v) the following, so long as the applicability, amount, or
validity of which is being contested in good faith by appropriate proceedings
diligently conducted, and against which reserves or other provisions required by
GAAP have been made, levy and execution thereon have been stayed and continue to
be stayed, and they do not in the aggregate materially detract from the value of
the property of the Person in question, or materially impair the use thereof in
the operation of its business: (A) claims and Liens for Taxes (other than Liens
relating to Environmental Laws or ERISA); (B) claims and Liens upon, and defects
of title to, real or personal property, including any attachment of personal or
real property or other legal process prior to adjudication of a dispute of the
merits; and (C) claims and Liens of mechanics, materialmen, warehousemen,
carriers, landlords, or other like Liens;
(vi) Liens in favor of Administrative Agent with respect to Cash
Collateralized Letters of Credit;
(vii) Liens in favor of Borrower;
(viii) Liens in assets or properties acquired with purchase money
Debt securing only such purchase money Debt;
(ix) Liens on any property or asset of any corporation or other
entity existing at the time such corporation or other entity becomes a
Subsidiary or is merged or consolidated with or into any Restricted Company or
at the time such property or asset is acquired from such corporation or other
entity, other than any Lien placed on any property or asset of such corporation
or other entity in contemplation of such acquisition, merger, or consolidation;
(x) Liens securing non-recourse Debt incurred in connection with
industrial revenue or similar financing;
(xi) Liens for current taxes not yet due; and
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43
(xii) any renewals, extensions, or refinancings (but not increase in
the principal amount thereof) of any of the foregoing Permitted Liens.
9.3 SUBSIDIARY INDEBTEDNESS; LIMITATIONS ON UPSTREAMING. Borrower
shall not permit any Restricted Subsidiary to guaranty any Debt of Borrower
unless such Restricted Subsidiary also executes a pari passu guaranty of the
Obligation. Borrower shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly agree to any restriction or limitation on the making
of dividends or distributions, the repaying of loans or advances or the
transferring of assets from any Restricted Subsidiary to Borrower or any other
Restricted Subsidiary, except (a) restrictions and limitations imposed by Legal
Requirements, (b) customary restrictions and limitations contained in agreements
relating to the sale of a Subsidiary or its assets that is permitted hereunder
and (c) any other restrictions that could not reasonably be expected to cause a
Material Adverse Event.
9.4 TRANSACTIONS WITH AFFILIATES. Borrower shall not, and shall
not permit any other Restricted Company to, enter into any transaction with any
of its Affiliates, other than transactions upon fair and reasonable terms not
materially less favorable than such Restricted Company could obtain or could
become entitled to in an arm's-length transaction with a Person that was not its
Affiliate.
9.5 COMPLIANCE WITH DOCUMENTS. Borrower shall not, and shall not
permit any other Company to, violate the provisions of its Constituent
Documents, or modify, repeal, replace, or amend any provision of its Constituent
Documents, if such action could materially and adversely affect the Rights of
any Credit Party under this Agreement or the other Loan Documents.
9.6 ASSIGNMENT. Borrower shall not assign or transfer any of its
Rights, duties, or obligations under any of the Loan Documents.
9.7 FISCAL YEAR AND ACCOUNTING METHODS. Borrower shall not, and
shall not permit any other Restricted Company to, change its method of
accounting, other than immaterial changes in methods or as required by GAAP.
Borrower shall not, and shall not permit any other Restricted Company to, change
its fiscal year for book accounting purposes, except upon the delivery of
written notice to Administrative Agent.
9.8 GOVERNMENT REGULATIONS. Borrower shall not, and shall not
permit any other Restricted Company to, conduct its business in such a way that
it will become subject to regulation under the Investment Company Act of 1940,
as amended, the Public Utility Holding Company Act of 1935, as amended, or any
other Legal Requirement (other than Regulations T, U, and X of the Board of
Governors of the Federal Reserve System) which regulates the incurrence of Debt.
9.9 SALE OF ASSETS. Borrower shall not, and shall not permit any
other Restricted Company to, sell, assign, transfer, or otherwise dispose of all
or substantially all of its assets, other than (a) sales, assignments,
transfers, or other dispositions of assets by a Restricted Subsidiary to
Borrower or to another Restricted Subsidiary and (b) sales, assignments,
transfers, or other dispositions of assets (to Persons other than Borrower or a
Restricted Subsidiary) of Restricted Subsidiaries (i) having an aggregate fair
market value not to exceed $100,000,000 in any fiscal year, or (ii) in the
ordinary course of business.
9.10 MERGERS AND DISSOLUTIONS; SALE OF CAPITAL STOCK. Borrower
shall not, and shall not permit any other Restricted Company to, directly or
indirectly, merge or consolidate with any other Person, other than (a) mergers
or consolidations involving Borrower if Borrower is the surviving entity, and
(b) mergers or consolidations among Wholly-owned Companies, in each case so long
as no Potential
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44
Default or Event of Default exists or would result therefrom; provided that in
any merger involving Restricted Company, a Restricted Company must be the
surviving entity. Borrower shall not, and shall not permit any other Restricted
Company to, liquidate, wind up, or dissolve (or suffer any liquidation or
dissolution), other than liquidations, wind ups, or dissolutions incident to
mergers or consolidations permitted under this SECTION 9.10. Borrower shall not,
and shall not permit any other Company to, sell, assign, lease, transfer, or
otherwise dispose of the Stock of any other Restricted Company, other than
sales, assignments, leases, transfers, or other such dispositions to another
Company. Notwithstanding the foregoing, nothing in this Agreement shall prohibit
any mergers, consolidations, liquidations, wind ups, or dissolutions of any
Subsidiary or the sale, assignment, lease, transfer, or other disposal of the
Stock of any Subsidiary so long as (i) no Potential Default or Event of Default
exists or would result from such merger, consolidation, liquidation, wind up, or
dissolution or such sale, assignment, lease, transfer, or other disposal of such
Stock, (ii) after giving effect thereto, the character of the business of the
Restricted Companies, on a consolidated basis, will not be materially changed,
and (iii) the assets, annual revenues, and annual net income, in each case
determined in accordance with GAAP, of the affected Subsidiary does not exceed
$100,000,000.
9.11 NEW BUSINESS. Borrower shall not, and shall not permit any
other Restricted Company to, directly or indirectly, permit or suffer to exist
any material change (on a consolidated basis) in the type of businesses in which
it is engaged from the businesses (on a consolidated basis) of the Companies as
conducted on the Closing Date.
9.12 FINANCIAL COVENANTS.
(a) LEVERAGE RATIO. Borrower shall not permit the Leverage Ratio
(expressed as a percent), as of the last day of any fiscal quarter of Borrower,
to be greater than fifty-five percent (55%).
(b) INTEREST COVERAGE. Borrower shall not permit the Interest
Coverage Ratio, as of the last day of any fiscal quarter of Borrower, to be less
than 2.0 to 1.0.
(c) MINIMUM TANGIBLE NET WORTH. Borrower shall not permit
Consolidated Tangible Net Worth, as of any date, to be less than the sum of (a)
$1,700,000,000, plus (b) fifty percent (50%) of the amount of Net Proceeds from
any Equity Issuance subsequent to March 31, 2003, plus (c) fifty percent (50%)
of Cumulative Consolidated Net Income.
SECTION 10 DEFAULT.
The term "EVENT OF DEFAULT" means the occurrence of any one or more of
the following events:
10.1 PAYMENT OF OBLIGATION. The failure or refusal of Borrower to
pay (a) all or any part of the Principal Debt or any L/C Obligation when the
same becomes due (whether by its terms, by acceleration, or as otherwise
provided in the Loan Documents), or (b) any other part of the Obligation within
five (5) calendar days after the due date, or (c) the indemnification and
reimbursement obligations provided for in the Loan Documents after demand
therefor.
10.2 COVENANTS. The failure or refusal of Borrower (and, if
applicable, any other Company) to punctually and properly perform, observe, and
comply with:
(a) any covenant, agreement, or condition contained in SECTION 8.3
(other than SECTIONS 8.3(e), 8.3(f), and 8.3(g)); or
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45
(b) any covenant, agreement, or condition contained in SECTIONS
8.3(e), 8.3(f), 8.3(g), 8.12, or 9, and such failure or refusal continues
unremedied for ten (10) days after the earlier of (i) notice given by
Administrative Agent to Borrower of such failure or refusal, or (ii) Borrower's
actual knowledge of such failure or refusal; or
(c) any other covenant, agreement, or condition contained in any
Loan Document (other than the covenants to pay the Obligation and the covenants
in CLAUSE (a) or (b) preceding) and such failure or refusal continues unremedied
for thirty (30) days after the earlier of (i) notice given by Administrative
Agent to Borrower of such failure or refusal, or (ii) Borrower's actual
knowledge of such failure or refusal.
10.3 DEBTOR RELIEF. Any Restricted Company (a) shall not be
Solvent, (b) fails to pay its Debts generally as they become due, (c) makes an
assignment for the benefit of creditors, (d) voluntarily seeks, consents to, or
acquiesces in the benefit of any Debtor Relief Law, other than as a creditor or
claimant, or (e) becomes a party to or is made the subject of any proceeding
provided for by any Debtor Relief Law, other than as a creditor or claimant,
that could suspend or otherwise adversely affect the Rights of any Credit Party
granted in the Loan Documents (unless, in the event such proceeding is
involuntary, the petition instituting same is dismissed within sixty (60) days
after its filing without the entry of an order for relief or the appointment of
a receiver) or an order of relief or judgment is entered in, or a receiver or
similar officer is appointed pursuant to, any such proceeding.
10.4 JUDGMENTS AND ATTACHMENTS. Any Restricted Company fails,
within sixty (60) days after entry, to pay, bond, or otherwise discharge any
judgment or order for the payment of money in excess of $20,000,000
(individually or collectively) or any warrant of attachment, sequestration, or
similar proceeding against any Restricted Company's assets having a value
(individually or collectively) of $20,000,000, in each case, which is not stayed
on appeal.
10.5 GOVERNMENT ACTION.
(a) A final non-appealable order is issued by any Governmental
Authority, including, but not limited to, the United States Justice Department,
seeking to cause any Restricted Company to divest a significant portion of its
assets pursuant to any antitrust, restraint of trade, unfair competition,
industry regulation, or similar Legal Requirements; or
(b) Any Governmental Authority shall condemn, seize, or otherwise
appropriate, or take custody or control of all or any substantial portion of the
assets of any Restricted Company.
10.6 MISREPRESENTATION. Any representation or warranty made by
Borrower contained in any Loan Document shall at any time prove to have been
incorrect in any material respect when made.
10.7 CHANGE OF CONTROL. A Change in Control of Borrower shall
occur.
10.8 DEFAULT UNDER OTHER DEBT AND AGREEMENTS.
(a) Any Restricted Company fails to make any payments when due
(after lapse of any applicable grace periods) with respect to any Debt of such
Restricted Company (other than the Obligation) in excess (individually or
collectively) of $20,000,000; and
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46
(b) Any default exists under any agreement (other than the Loan
Documents) to which any Restricted Company is a party, which has not been waived
by the parties thereto, the effect of which has been to cause, or to permit any
Person to cause, an amount of Debt of such Restricted Company in excess
(individually or collectively) of $20,000,000 to become due and payable by such
Restricted Company (whether by acceleration or by its terms).
10.9 EMPLOYEE BENEFIT PLANS.
(a) A "Reportable Event" or "Reportable Events," or a failure to
make a required installment or other payment (within the meaning of Section
412(n)(1) of the Tax Code), shall have occurred with respect to any Employee
Plan or Plans that is reasonably expected to result in liability of Borrower to
the PBGC or to an Employee Plan in an aggregate amount exceeding $20,000,000; or
(b) Borrower or any ERISA Affiliate has provided to any affected
party a sixty (60) day notice of intent to terminate an Employee Plan pursuant
to a distress termination in accordance with Section 4041(c) of ERISA if the
liability reasonably expected to be incurred as a result of such termination
will exceed $20,000,000; or
(c) A trustee shall be appointed by a United States district court
to administer any such Employee Plan pursuant to Section 4042(b) of ERISA; or
(d) The PBGC shall institute proceedings (including giving notice
of intent thereof) to terminate any such Employee Plan if such termination
proceeding is reasonably expected to result in liability on the part of Borrower
in excess of $20,000,000; or
(e) (i) Borrower or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that it has incurred withdrawal liability
(within the meaning of Section 4201 of ERISA) to such Multiemployer Plan, (ii)
Borrower or such ERISA Affiliate does not have reasonable grounds for contesting
such withdrawal liability or is not contesting such withdrawal liability in a
timely and appropriate manner and (iii) the amount of such withdrawal liability
specified in such notice, when aggregated with all other amounts required to be
paid to Multiemployer Plans in connection with withdrawal liabilities
(determined as of the date or dates of such notification), exceeds $20,000,000;
or
(f) Borrower or any ERISA Affiliate shall have been notified by
the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of ERISA,
if solely as a result of such reorganization or termination the aggregate annual
contributions of Borrower and its ERISA Affiliates to all Multiemployer Plans
that are then in reorganization or have been or are being terminated have been
or will be increased over the amounts required to be contributed to such
Multiemployer Plans for their most recently completed plan years by an amount
exceeding $20,000,000.
10.10 VALIDITY AND ENFORCEABILITY OF LOAN DOCUMENTS. Any Loan
Document shall, at any time after its execution and delivery and for any reason,
cease to be in full force and effect in any material respect or be declared to
be null and void (other than in accordance with the terms hereof or thereof) or
the validity or enforceability thereof be contested by Borrower or Borrower
shall deny in writing that it has any or any further liability or obligations
under any Loan Document to which it is a party.
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47
SECTION 11 RIGHTS AND REMEDIES.
11.1 REMEDIES UPON DEFAULT.
(a) If an Event of Default exists under SECTION 10.3(C), 10.3(D),
or 10.3(e) then (i) the commitment to extend credit hereunder shall
automatically terminate (ii) the entire unpaid balance of the Obligation shall
automatically become due and payable, and (iii) Borrower shall automatically be
required to Cash Collateralize the then-undrawn amount of outstanding Letters of
Credit (in an amount equal to the outstanding amount thereof), in each case
without any action or notice of any kind whatsoever.
(b) If any Event of Default exists, then Administrative Agent may
(and, subject to the terms of SECTION 12, shall upon the request of Required
Lenders) or Required Lenders may, do any one or more of the following: (i) if
the maturity of the Obligation has not already been accelerated under SECTION
11.1(a), then declare the entire unpaid balance of the Obligation, or any part
thereof, immediately due and payable, whereupon it shall be due and payable;
(ii) terminate the commitments of Lenders to extend credit hereunder; (iii)
reduce any claim to judgment; (iv) to the extent permitted by all Legal
Requirements, exercise (or request each Lender to, and each Lender shall be
entitled to, exercise) the Rights of offset or banker's Lien against the
interest of any Company in and to every account and other property of any
Company which are in the possession of any Credit Party to the extent of the
full amount of the Obligation (to the extent permitted by all Legal
Requirements, Borrower being deemed directly obligated to each Credit Party in
the full amount of the Obligation for such purposes); (v) require that Borrower
Cash Collateralize the then-undrawn amount of outstanding Letters of Credit (in
an amount equal to the outstanding amount thereof); and (vi) exercise any and
all other legal or equitable Rights afforded by the Loan Documents, the Legal
Requirements of the State of Texas, or any other applicable jurisdiction as
Administrative Agent shall deem appropriate, or otherwise, including, but not
limited to, the Right to bring suit or other proceedings before any Governmental
Authority either for specific performance of any covenant or condition contained
in any of the Loan Documents or in aid of the exercise of any Right granted to
any Credit Party in any of the Loan Documents; provided that each Lender
reserves the right to bring suit to recover Obligations owing to such Lender
after such Obligations become due and payable in the event Administrative Agent
or Required Lenders do not do so on its behalf.
11.2 BORROWER WAIVERS. To the extent permitted by all Legal
Requirements, Borrower hereby waives presentment and demand for payment,
protest, notice of intention to accelerate, notice of acceleration, and notice
of protest and nonpayment, and agrees that its liability with respect to the
Obligation (or any part thereof) shall not be affected by any renewal or
extension in the time of payment of the Obligation (or any part thereof), by any
indulgence, or by any release or change in any security for the payment of the
Obligation (or any part thereof).
11.3 PERFORMANCE BY ADMINISTRATIVE AGENT. If any covenant, duty, or
agreement of Borrower is not performed in accordance with the terms of the Loan
Documents, while an Event of Default exists, then Administrative Agent may, at
its option (but subject to the approval of Required Lenders), perform or attempt
to perform such covenant, duty, or agreement on behalf of Borrower. In such
event, any amount expended by Administrative Agent in such performance or
attempted performance shall be payable by Borrower to Administrative Agent on
demand, shall become part of the Obligation, and shall bear interest at the
Default Rate from the date of such expenditure by Administrative Agent until
paid. Notwithstanding the foregoing, it is expressly understood that
Administrative Agent
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48
does not assume, and shall never have, except by its express written consent,
any liability or responsibility for the performance of any covenant, duty, or
agreement of Borrower.
11.4 DELEGATION OF DUTIES AND RIGHTS. The Credit Parties may
perform any of their duties or exercise any of their Rights under the Loan
Documents by or through their respective Representatives.
11.5 NOT IN CONTROL. Nothing in any Loan Document shall, or shall
be deemed to (a) give any Credit Party the Right to exercise control over the
assets (including real property), affairs, or management of any Company, (b)
preclude or interfere with compliance by any Company with any Legal Requirement,
or (c) require any act or omission by any Company that may be harmful to Persons
or property. Any "Material Adverse Event" or other materiality qualifier in any
representation, warranty, covenant, or other provision of any Loan Document is
included for credit documentation purposes only and shall not, and shall not be
deemed to, mean that any Credit Party acquiesces in any non-compliance by any
Company with any Legal Requirement or document, or that any Credit Party does
not expect any Company to promptly, diligently, and continuously carry out all
appropriate removal, remediation, and termination activities required or
appropriate in accordance with all Environmental Laws. The Credit Parties have
no fiduciary relationship with or fiduciary duty to any Company arising out of
or in connection with the Loan Documents, and the relationship between the
Credit Parties, on the one hand, and the Companies, on the other hand, in
connection with the Loan Documents is solely that of debtor and creditor. The
power of the Credit Parties under the Loan Documents is limited to the Rights
provided in the Loan Documents, which Rights exist solely to assure payment and
performance of the Obligation and may be exercised in a manner calculated by the
Credit Parties in their respective good faith business judgment.
11.6 COURSE OF DEALING. The acceptance by any Credit Party at any
time and from time to time of partial payment on the Obligation shall not be
deemed to be a waiver of any Event of Default then existing. No waiver by any
Credit Party of any Event of Default shall be deemed to be a waiver of any other
then-existing or subsequent Event of Default. No delay or omission by any Credit
Party in exercising any Right under the Loan Documents shall impair such Right
or be construed as a waiver thereof or any acquiescence therein, nor shall any
single or partial exercise of any such Right preclude other or further exercise
thereof, or the exercise of any other Right under the Loan Documents or
otherwise.
11.7 CUMULATIVE RIGHTS. All Rights available to the Credit Parties
under the Loan Documents are cumulative of and in addition to all other Rights
granted to the Credit Parties at law or in equity, whether or not the Obligation
is due and payable and whether or not the Credit Parties have instituted any
suit for collection, foreclosure, or other action in connection with the Loan
Documents.
11.8 APPLICATION OF PROCEEDS. Any and all proceeds ever received by
any Credit Party from the exercise of any Rights pertaining to the Obligation
shall be applied to the Obligation in the order and manner set forth in SECTION
3.7.
11.9 CERTAIN PROCEEDINGS. Borrower will promptly execute and
deliver, or cause the execution and delivery of, all applications, certificates,
instruments, registration statements, and all other documents and papers any
Credit Party may reasonably request in connection with the obtaining of any
consent, approval, registration, qualification, permit, license, or
Authorization of any Governmental Authority or other Person necessary or
appropriate for the effective exercise of any Rights under the Loan Documents.
Because Borrower agrees that the Credit Parties' remedies at law for failure of
Borrower to comply with the provisions of this SECTION 11.9 would be inadequate
and that such failure would not be
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
49
adequately compensable in damages, Borrower agrees that the covenants of this
SECTION 11.9 may be specifically enforced.
11.10 EXPENSES; INDEMNIFICATION.
(a) Borrower agrees (i) to pay or reimburse Administrative Agent
for all reasonable out-of-pocket costs and expenses incurred in connection with
the development, preparation, negotiation, and execution of this Agreement and
the other Loan Documents and any amendment, waiver, consent, or other
modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (ii) to pay or reimburse
Administrative Agent and each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Obligation and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs. The
foregoing costs and expenses shall include all search, filing, recording, title
insurance, and appraisal charges and fees and taxes related thereto, and other
out-of-pocket expenses incurred by Administrative Agent and the cost of
independent public accountants and other outside experts retained by the
Administrative Agent or any Lender. All amounts due under this SECTION 11.10(a)
shall be payable within ten (10) Business Days after demand therefor. The
agreements in this SECTION 11.10(a) shall survive the termination of the
Commitments and repayment of the Obligation.
(b) Whether or not the transactions contemplated hereby are
consummated, Borrower shall indemnify and hold harmless each Agent-Related
Person, each Lender and their respective Affiliates, directors, officers,
employees, counsel, agents, and attorneys-in-fact (collectively, "INDEMNITEES")
from and against any and all liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses, and
disbursements (including Attorney Costs) of any kind or nature whatsoever which
may at any time be imposed on, incurred by or asserted against any such
Indemnitee in any way relating to or arising out of or in connection with (i)
the execution, delivery, enforcement, performance or administration of any Loan
Document or any other agreement, letter or instrument delivered in connection
with the transactions contemplated thereby or the consummation of the
transactions contemplated thereby, (ii) any Commitment, Borrowing, Letter of
Credit, or the use or proposed use of the proceeds therefrom, or (iii) any
actual or alleged presence or release of Hazardous Materials on or from any
property currently or formerly owned or operated by Borrower or any Subsidiary,
or any liability under Environmental Law related in any way to Borrower or any
Subsidiary, 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 (including any investigation of, preparation for, or defense
of any pending or threatened claim, investigation, litigation, or proceeding)
and regardless of whether any Indemnitee is a party thereto (all the foregoing,
collectively, the "INDEMNIFIED LIABILITIES"), IN ALL CASES, WHETHER OR NOT
CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE NEGLIGENCE OF THE
INDEMNITEE; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses, or
disbursements are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence, bad faith, or
willful misconduct of such Indemnitee or such Indemnitee's willful failure to
pay under any Letter of Credit after the presentation to it by the beneficiary
of a sight draft and certificate(s) strictly complying with the terms and
conditions of a Letter of Credit. No Indemnitee shall be liable for any damages
arising from the use by others of any information or other
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
50
materials obtained through IntraLinks or other similar information transmission
systems in connection with this Agreement, nor shall Borrower or any Indemnitee
have any liability for any indirect, punitive, or consequential damages relating
to this Agreement or any other Loan Document or arising out of its activities in
connection herewith or therewith (whether before or after the Closing Date). All
amounts due under this SECTION 11.10(B) shall be payable within ten (10)
Business Days after demand therefor. The agreements in this SECTION 11.10(B)
shall survive the resignation of Administrative Agent, the replacement of any
Lender, the termination of the Commitments, and the repayment, satisfaction or
discharge of the Obligation.
SECTION 12 ADMINISTRATIVE AGENT.
12.1 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably appoints, designates, and
authorizes Administrative Agent to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, Administrative Agent
shall not have any duties or responsibilities, except those expressly set forth
herein, nor shall Administrative Agent have or be deemed to have any fiduciary
relationship with any Lender or participant, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against
Administrative Agent. Without limiting the generality of the foregoing sentence,
the use of the term "agent" herein and in the other Loan Documents with
reference to Administrative Agent is not intended to connote any fiduciary or
other implied (or express) obligations arising under agency doctrine of any
applicable Law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative relationship between
independent contracting parties.
(b) Each L/C Issuer shall act on behalf of Lenders with respect to
the Letters of Credit issued by it and the Letter of Credit Applications
associated therewith, and such L/C Issuer shall have all of the benefits and
immunities (i) provided to the Administrative Agent in this SECTION 12 with
respect to any acts taken or omissions suffered by such L/C Issuer in connection
with Letters of Credit issued by it or proposed to be issued by it and the
Letter of Credit Applications pertaining to such Letters of Credit as fully as
if the term "Administrative Agent" as used in this SECTION 12 and in the
definition of "Agent-Related Person" included such L/C Issuer with respect to
such acts or omissions, and (ii) as additionally provided herein with respect to
such L/C Issuer.
12.2 DELEGATION OF DUTIES. Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through agents,
employees, or attorneys-in-fact and shall be entitled to advice of counsel and
other consultants or experts concerning all matters pertaining to such duties.
Administrative Agent shall not be responsible for the negligence or misconduct
of any agent or attorney-in-fact that it selects in the absence of gross
negligence or willful misconduct.
12.3 LIABILITY OF ADMINISTRATIVE AGENT. No Agent-Related Person
shall (a) be liable for any action taken or omitted to be taken by any of them
under or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct in connection with its duties expressly set forth herein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by any Company or any officer
thereof, contained herein or in any other Loan Document, or in any certificate,
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51
report, statement, or other document referred to or provided for in, or received
by Administrative Agent under or in connection with, this Agreement or any other
Loan Document, or the validity, effectiveness, genuineness, enforceability, or
sufficiency of this Agreement or any other Loan Document, or for any failure of
any Company or any other party to any Loan Document to perform its obligations
hereunder or thereunder. No Agent-Related Person shall be under any obligation
to any Lender or participant to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books, or
records of any Company or any Affiliate thereof.
12.4 RELIANCE BY ADMINISTRATIVE AGENT.
(a) Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, electronic mail message,
statement, or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to any
Company), independent accountants and other experts selected by Administrative
Agent. Administrative Agent shall be fully justified in failing or refusing to
take any action under any Loan Document unless it shall first receive such
advice or concurrence of the Required Lenders as it deems appropriate and, if it
so requests, it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. Administrative Agent shall in
all cases be fully protected in acting, or in refraining from acting, under this
Agreement or any other Loan Document in accordance with a request or consent of
the Required Lenders (or such greater number of Lenders as may be expressly
required hereby in any instance) and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders.
(b) For purposes of determining compliance with the conditions
specified in SECTION 6.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless Administrative Agent shall have
received notice from such Lender prior to the proposed Closing Date specifying
its objection thereto.
12.5 NOTICE OF EVENT OF DEFAULT. Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Event of Default,
except with respect to defaults in the payment of principal, interest, and fees
required to be paid to Administrative Agent for the account of the Lenders,
unless Administrative Agent shall have received written notice from a Lender or
Borrower referring to this Agreement, describing such Event of Default and
stating that such notice is a "notice of default." Administrative Agent will
notify Lenders of its receipt of any such notice and of its giving of notice to
Borrower pursuant to SECTIONS 10.2(b) or (c). Administrative Agent shall take
such action with respect to such Event of Default as may be directed by the
Required Lenders in accordance with SECTION 10; provided, however, that unless
and until Administrative Agent has received any such direction, Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Event of Default as it shall deem
advisable or in the best interest of the Lenders.
12.6 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE
AGENT. Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
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52
review of the affairs of any Company or any Affiliate thereof, shall be deemed
to constitute any representation or warranty by any Agent-Related Person to any
Lender as to any matter, including whether Agent-Related Persons have disclosed
material information in their possession. Each Lender represents to
Administrative Agent that it has, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial, and other condition and
creditworthiness of the Companies, and all applicable bank or other regulatory
Legal Requirements relating to the transactions contemplated hereby, and made
its own decision to enter into this Agreement and to extend credit to Borrower
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals, and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial, and other condition and creditworthiness of Borrower.
Except for notices, reports, and other documents expressly required to be
furnished to Lenders by Administrative Agent herein, Administrative Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, prospects, operations, property,
financial, and other condition or creditworthiness of any Companies or any of
their respective Affiliates which may come into the possession of any
Agent-Related Person.
12.7 INDEMNIFICATION OF ADMINISTRATIVE AGENT. Whether or not the
transactions contemplated hereby are consummated, Lenders shall indemnify upon
demand each Agent-Related Person (to the extent not reimbursed by or on behalf
of any Company and without limiting the obligation of any Company to do so), Pro
Rata, and hold harmless each Agent-Related Person from and against any and all
Indemnified Liabilities incurred by it; provided, however, that no Lender shall
be liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities to the extent determined in a final, nonappealable
judgment by a court of competent jurisdiction to have resulted from such
Agent-Related Person's own gross negligence or willful misconduct; provided,
however, that no action taken in accordance with the directions of the Required
Lenders shall be deemed to constitute gross negligence or willful misconduct for
purposes of this SECTION 12.7. Without limitation of the foregoing, each Lender
shall reimburse Administrative Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including Attorney Costs) incurred by
Administrative Agent in connection with the preparation, execution, delivery,
administration, modification, amendment, or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that
Administrative Agent is not reimbursed for such expenses by or on behalf of
Borrower. The undertaking in this SECTION 12.7 shall survive termination of the
Aggregate Commitments, the payment of the Obligation, and the resignation of
Administrative Agent.
12.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
Administrative Agent and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, and generally engage in any
kind of banking, trust, financial advisory, underwriting, or other business with
each Company and its respective Affiliates as though Administrative Agent were
not Administrative Agent and without notice to or consent of Lenders. Lenders
acknowledge that, pursuant to such activities, Administrative Agent or its
Affiliates may receive information regarding any Company or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of such Company or such Affiliate) and acknowledge that Administrative
Agent shall be under no obligation to provide such information to them. With
respect to Borrowings, Administrative Agent shall have the same rights and
powers under this Agreement as any other Lender and may exercise such rights and
powers as though it
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53
were not Administrative Agent, and the terms "Lender" and "Lenders" include
Administrative Agent in its individual capacity.
12.9 SUCCESSOR ADMINISTRATIVE AGENT. Administrative Agent may
resign as Administrative Agent upon thirty (30) days' notice to Lenders. If
Administrative Agent resigns under this Agreement, the Required Lenders shall
appoint from among Lenders a successor administrative agent for Lenders, which
successor administrative agent shall be consented to by Borrower at all times
other than during the existence of an Event of Default (which consent of
Borrower shall not be unreasonably withheld or delayed). If no successor
administrative agent is appointed prior to the effective date of the resignation
of Administrative Agent, Administrative Agent may appoint, after consulting with
Lenders and with the consent of Borrower at all times other than during the
existence of an Event of Default (which consent of Borrower shall not be
unreasonably withheld or delayed), a successor administrative agent from among
Lenders. Upon the acceptance of its appointment as successor administrative
agent hereunder, the Person acting as such successor administrative agent shall
succeed to all the rights, powers, and duties of the retiring Administrative
Agent, and the term "Administrative Agent" shall mean such successor
administrative agent, and the retiring Administrative Agent's appointment,
powers, and duties as Administrative Agent shall be terminated without any
further act or deed on the part of any other Lender. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this SECTION 12 and SECTION 11.10 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement. If no successor administrative agent has accepted
appointment as Administrative Agent by the date which is thirty (30) days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above.
12.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIMS. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition, or other judicial
proceeding relative to any Company, Administrative Agent (irrespective of
whether the principal of any Borrowing shall then be due and payable as herein
expressed or by declaration or otherwise and irrespective of whether
Administrative Agent shall have made any demand on Borrower) shall be entitled
and empowered, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Borrowings and any
other Obligation that are owing and unpaid and to file such other documents as
may be necessary or advisable in order to have the claims of Lenders and
Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements, and advances of Lenders and Administrative Agent and
their respective agents and counsel and all other amounts due Lenders and
Administrative Agent under SECTIONS 5 and 11.10) allowed in such judicial
proceeding; and
(b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to Administrative Agent and, in the event that
Administrative Agent shall consent to the making of such payments directly to
the Lenders, to pay to Administrative Agent any amount due for the reasonable
compensation, expenses, disbursements and advances of Administrative Agent and
its agents and counsel, and any other amounts due Administrative Agent under
SECTIONS 5 and 11.10.
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54
Nothing contained herein shall be deemed to authorize 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 Obligation
or the rights of any Lender or to authorize Administrative Agent to vote in
respect of the claim of any Lender in any such proceeding.
12.11 OTHER AGENT; ARRANGERS; AND MANAGERS. No Lender or other
Persons identified on the facing page or signature pages of this Agreement as a
"syndication agent," "documentation agent," "book manager," "arranger," or "lead
arranger" shall have any right, power, obligation, liability, responsibility, or
duty under this Agreement other than, in the case of such Lenders, those
applicable to all Lenders as such. Without limiting the foregoing, no Lender or
other Person so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any Lenders or other Persons so identified in deciding to
enter into this Agreement or in taking or not taking action hereunder.
SECTION 13 MISCELLANEOUS.
13.1 HEADINGS. The headings, captions, and arrangements used in any
of the Loan Documents are, unless specified otherwise, for convenience only and
shall not be deemed to limit, amplify, or modify the terms of the Loan
Documents, nor affect the meaning thereof.
13.2 NONBUSINESS DAYS. In any case where any payment or action is
due under any Loan Document on a day which is not a Business Day, such payment
or action may be delayed until the next-succeeding Business Day, but interest
and fees shall continue to accrue in respect of any payment to which it is
applicable until such payment is in fact made; provided that if, in the case of
any such payment in respect of a Eurodollar Borrowing, the next-succeeding
Business Day is in the next calendar month, then such payment shall be made on
the next-preceding Business Day.
13.3 COMMUNICATIONS.
(a) GENERAL. Unless otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission). All such written notices shall be mailed,
faxed, or delivered to the applicable address, facsimile number, or (subject to
SECTION 13.3(c) below) electronic mail address, and all notices and other
communications expressly permitted hereunder to be given by telephone shall be
made to the applicable telephone number specified for such Person on SCHEDULE
2.1 or to such other address, facsimile number, electronic mail address, or
telephone number as shall be designated by such party in a notice to the other
parties. All such notices and other communications shall be deemed to be given
or made upon the earlier to occur of (i) actual receipt by the relevant party
hereto and (ii) (A) if delivered by hand or by courier, when signed for by or on
behalf of the relevant party hereto; (B) if delivered by mail, four (4) Business
Days after deposit in the mails, postage prepaid; (C) if delivered by facsimile,
when sent and receipt has been confirmed by telephone; and (D) if delivered by
electronic mail (which form of delivery is subject to the provisions of SECTION
13.3(c) below), when delivered; provided, however, that notices and other
communications to Administrative Agent or any L/C Issuer pursuant to SECTION 2
shall not be effective until actually received by Administrative Agent or such
L/C Issuer. In no event shall a voicemail message be effective as a notice,
communication or confirmation hereunder.
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
55
(b) EFFECTIVENESS OF FACSIMILE DOCUMENTS AND SIGNATURES. Loan
Documents may be transmitted and/or signed by facsimile. The effectiveness of
any such documents and signatures shall, subject to applicable Law, have the
same force and effect as manually-signed originals and shall be binding on all
Companies, Administrative Agent, and Lenders. Administrative Agent may also
require that any such documents and signatures be confirmed by a manually-signed
original thereof; provided, however, that the failure to request or deliver the
same shall not limit the effectiveness of any facsimile document or signature.
(c) LIMITED USE OF ELECTRONIC MAIL. Electronic mail and Internet
and intranet websites may be used only to distribute routine communications and
to distribute Loan Documents for execution by the parties thereto, and may not
be used for any other purpose.
(d) RELIANCE BY ADMINISTRATIVE AGENT AND LENDERS. Administrative
Agent and Lenders shall be entitled to rely and act upon any notices (including
telephonic Notices of Borrowing) purportedly given by or on behalf of Borrower
even if (i) such notices were not made in a manner specified herein, were
incomplete or were not preceded or followed by any other form of notice
specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. Borrower shall indemnify each
Agent-Related Person and each Lender from all losses, costs, expenses, and
liabilities resulting from the reliance by such Person on each notice
purportedly given by or on behalf of Borrower. All telephonic notices to and
other communications with Administrative Agent may be recorded by Administrative
Agent, and each of the parties hereto hereby consents to such recording.
13.4 FORM AND NUMBER OF DOCUMENTS. Each agreement, document,
instrument, or other writing to be furnished under any provision of this
Agreement must be in form and substance and in such number of counterparts as
may be reasonably satisfactory to Administrative Agent and its counsel.
13.5 EXCEPTIONS TO COVENANTS. Borrower shall not, and shall not
permit any other Company to, take any action or fail to take any action which is
permitted as an exception to any of the covenants contained in any Loan Document
if such action or omission would result in the breach of any other covenant
contained in any of the Loan Documents.
13.6 SURVIVAL. All covenants, agreements, undertakings,
representations, and warranties made in any of the Loan Documents shall survive
the execution and delivery thereof and all closings under the Loan Documents.
All such representations and warranties have been or will be relied upon by
Administrative Agent and each Lender regardless of any investigation made by
Administrative Agent or any Lender or on their behalf and notwithstanding that
Administrative Agent or any Lender may have had notice or knowledge of any
Potential Default or Event of Default at the time of any Borrowing and shall
continue in full force and effect as long as any Borrowing or other Obligation
is outstanding. All rights of, and provisions relating to, reimbursement and
indemnification of any Credit Party shall survive termination of this Agreement
and payment in full of the Obligation.
13.7 GOVERNING LAW. THE LEGAL REQUIREMENTS OF THE STATE OF TEXAS
AND OF THE UNITED STATES OF AMERICA SHALL GOVERN THE RIGHTS AND DUTIES OF THE
PARTIES TO THE LOAN DOCUMENTS AND THE VALIDITY, CONSTRUCTION, ENFORCEMENT, AND
INTERPRETATION OF THE LOAN DOCUMENTS.
13.8 INVALID PROVISIONS. If any provision in any Loan Document is
held to be illegal, invalid, or unenforceable, then such provision shall be
fully severable; the appropriate Loan Document shall be construed and enforced
as if such provision had never comprised a part thereof; and the remaining
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
56
provisions thereof shall remain in full force and effect and shall not be
affected by such provision or by its severance therefrom. Each Credit Party and
each Company party to such Loan Document agree to negotiate, in good faith, the
terms of a replacement provision as similar to the severed provision as may be
possible and be legal, valid, and enforceable.
13.9 ENTIRETY. THE RIGHTS AND OBLIGATIONS OF BORROWER AND THE
CREDIT PARTIES SHALL BE DETERMINED SOLELY FROM WRITTEN AGREEMENTS, DOCUMENTS,
AND INSTRUMENTS, AND ANY PRIOR ORAL AGREEMENTS BETWEEN SUCH PARTIES ARE
SUPERSEDED BY AND MERGED INTO SUCH WRITINGS. THIS AGREEMENT (AS AMENDED IN
WRITING FROM TIME TO TIME) AND THE OTHER WRITTEN LOAN DOCUMENTS EXECUTED BY
BORROWER AND/OR ANY CREDIT PARTY (TOGETHER WITH ALL COMMITMENT LETTERS AND FEE
LETTERS AS THEY RELATED TO THE PAYMENT OF FEES AFTER THE CLOSING DATE)REPRESENT
THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
13.10 JURISDICTION; VENUE; SERVICE OF PROCESS; JURY TRIAL. EACH
PARTY HERETO, IN EACH CASE FOR ITSELF, ITS SUCCESSORS AND ASSIGNS, HEREBY (A)
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED
IN TEXAS, AND AGREES AND CONSENTS THAT SERVICE OF PROCESS MAY BE MADE UPON IT IN
ANY LEGAL PROCEEDING ARISING OUT OF OR IN CONNECTION WITH THE LOAN DOCUMENTS AND
THE OBLIGATION BY SERVICE OF PROCESS AS PROVIDED BY TEXAS LEGAL REQUIREMENTS,
(B) IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY ALL LEGAL
REQUIREMENTS, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY LITIGATION ARISING OUT OF OR IN CONNECTION WITH THE LOAN DOCUMENTS
AND THE OBLIGATION BROUGHT IN ANY SUCH COURT, (C) IRREVOCABLY WAIVES ANY CLAIMS
THAT ANY LITIGATION BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM, (D) IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF
ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH LITIGATION BY THE MAILING OF COPIES
THEREOF BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, POSTAGE PREPAID, AT ITS
ADDRESS SET FORTH HEREIN, (E) IRREVOCABLY AGREES THAT ANY LEGAL PROCEEDING
AGAINST ANY PARTY HERETO ARISING OUT OF OR IN CONNECTION WITH THE LOAN DOCUMENTS
OR THE OBLIGATION SHALL BE BY COURT TRIAL WITHOUT JURY, AND (F) IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY ALL LEGAL REQUIREMENTS, ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM, DEMAND, ACTION, OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF ANY LOAN DOCUMENT, THE TRANSACTIONS
CONTEMPLATED THEREBY, OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO
THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN
DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING
OR HEREINAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE;
AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR COPY OF
THIS SECTION 13.10 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. The scope of
each of the foregoing waivers is intended to be all-encompassing of any and all
disputes that may be filed in any court and that relate to the subject matter of
this transaction, including contract claims, tort claims, breach of duty claims,
and all other common law and statutory claims. Borrower and each other party to
this Agreement acknowledge that this waiver is a material inducement to the
agreement of each party hereto to enter into a business relationship, that each
has already relied on this waiver in entering into this Agreement, and each will
continue to rely on each of such waivers in related future dealings. Borrower
and each other party to this Agreement warrant and
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
57
represent that they have reviewed these waivers with their legal counsel, and
that they knowingly and voluntarily agree to each such waiver following
consultation with legal counsel. THE WAIVERS IN THIS SECTION 13.10 ARE
IRREVOCABLE, MEANING THAT THEY MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING,
AND THESE WAIVERS SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, SUPPLEMENTS, AND
REPLACEMENTS TO OR OF THIS OR ANY OTHER Loan Document. In the event of
Litigation, this Agreement may be filed as a written consent to a trial by the
court.
13.11 AMENDMENTS, CONSENTS, CONFLICTS, AND WAIVERS.
(a) Except as otherwise specifically provided, (i) this Agreement
may only be amended, modified or waived by an instrument in writing executed
jointly by Borrower and Required Lenders, and, in the case of any matter
affecting Administrative Agent by Administrative Agent, and may only be
supplemented by documents delivered or to be delivered in accordance with the
express terms hereof, and (ii) the other Loan Documents may only be the subject
of an amendment, modification, or waiver if Borrower and Required Lenders, and,
in the case of any matter affecting Administrative Agent (except as set forth
above), Administrative Agent, have approved same; provided that no such
amendment or waiver shall, unless signed by each Lender directly affected
thereby, (i) increase the Commitment of such Lender, (ii) reduce the principal
of or rate of interest on any Unreimbursed Amount or Borrowing or any fees or
other amounts payable hereunder, (iii) postpone any date fixed for the payment
of any scheduled installment of principal of or interest on any Unreimbursed
Amount or Borrowing or any fees or other amounts payable hereunder or for
termination of any of the Total Commitment, (iv) change the percentage of the
Total Commitment or of the unpaid principal amount of the Notes, or the number
of Lenders, which shall be required for Lenders or any of them to take any
action under this SECTION 13.11(a) or any other provision of this Agreement; (v)
amend, modify or waive this SECTION 13.11(a), or (vi) amend, modify or waive the
Pro Rata or ratable treatment of Lenders under this Agreement, or amend, modify
or waive the obligation of Borrower to Cash Collateralize the outstanding amount
of Letters of Credit.
(b) Any conflict or ambiguity between the terms and provisions
herein and terms and provisions in any other Loan Document shall be controlled
by the terms and provisions herein.
(c) No course of dealing nor any failure or delay by any Credit
Party or any of its Representatives with respect to exercising any Right of any
Credit Party hereunder shall operate as a waiver thereof. A waiver must be in
writing and signed by Administrative Agent and Required Lenders (or by all
Lenders, if required hereunder) to be effective, and such waiver will be
effective only in the specific instance and for the specific purpose for which
it is given.
13.12 MULTIPLE COUNTERPARTS. This Agreement may be executed in a
number of identical counterparts, each of which shall be deemed an original for
all purposes and all of which constitute, collectively, one agreement; but, in
making proof of this Agreement, it shall not be necessary to produce or account
for more than one such counterpart. It is not necessary that each Lender execute
the same counterpart so long as identical counterparts are executed by Borrower,
each Lender, and Administrative Agent. This Agreement shall become effective
when counterparts hereof shall have been executed and delivered to
Administrative Agent by each Lender, Administrative Agent, and Borrower, or,
when Administrative Agent shall have received telecopied, telexed, or other
evidence satisfactory to it that such party has executed and is delivering to
Administrative Agent a counterpart hereof.
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58
13.13 SUCCESSORS AND ASSIGNS; ASSIGNMENTS AND PARTICIPATIONS.
(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 Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an Eligible Assignee in accordance
with the provisions of SECTION 13.13(b), (ii) by way of participation in
accordance with the provisions of SECTION 13.13(d), or (iii) by way of pledge or
assignment of a security interest subject to the restrictions of SECTION
13.13(f). 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
SECTION 13.13(d) and, to the extent expressly contemplated hereby, the
Indemnitees) 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 Eligible
Assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and outstanding Borrowings
(including for purposes of this SECTION 13.13(b) participations in L/C
Obligations) at the time owing to it); provided that: (i) except in the case of
an assignment of the entire remaining amount of the assigning Lender's
Commitment and outstanding Borrowings and participations in Unreimbursed Amounts
at the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund (as defined in SECTION 13.13(g)) with
respect to a Lender, the aggregate amount of the Commitment (which for this
purpose includes Borrowings and participations in Unreimbursed Amounts
outstanding thereunder) subject to each such assignment, determined as of the
date the Assignment and Assumption with respect to such assignment is delivered
to Administrative Agent or, if "Trade Date" is specified in the Assignment and
Assumption, as of the Trade Date, shall not be less than $5,000,000 or a whole
multiple of $500,000 in excess thereof, and after such assignment, no Lender
shall hold a Commitment of less than $5,000,000 unless each of Administrative
Agent and, so long as no Event of Default has occurred and is continuing,
Borrower otherwise consents (each such consent not to be unreasonably withheld
or delayed); (ii) 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 Borrowings or the Commitment assigned; (iii)
any assignment of a Commitment or unfunded participation in Unreimbursed Amounts
must be approved by Administrative Agent (which approval shall not be
unreasonably withheld) unless the Person that is the proposed assignee is itself
a Lender (whether or not the proposed assignee would otherwise qualify as an
Eligible Assignee); and (iv) the parties to each assignment shall execute and
deliver to Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500. Subject to acceptance and recording
thereof by Administrative Agent pursuant to SECTION 13.13(c), from and after the
effective date specified in each Assignment and Assumption, the Eligible
Assignee thereunder shall be a party to this Agreement and, to the extent of the
interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of SECTIONS 4.1,
4.5, and 4.6 (with respect to facts and circumstances occurring prior to the
effective date of such assignment) and 11.10). Upon request, Borrower (at its
expense) shall execute and deliver a Note to the assignee Lender. Any assignment
or transfer by a Lender of rights or obligations under this Agreement that does
not comply with this subsection shall be treated for purposes of this Agreement
as a sale by such Lender of a participation in such rights and obligations in
accordance with SECTION 13.13(d).
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
59
(c) Administrative Agent, acting solely for this purpose as an
agent of Borrower, shall maintain at Administrative Agent's office a copy of
each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of Lenders, and the Commitments of,
principal amounts of the Borrowings and L/C Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the "REGISTER"). The entries in
the Register shall be conclusive in the absence of manifest error, and Borrower,
Administrative Agent, and Lenders may 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 Borrower and any Lender, at any reasonable
time and from time to time upon reasonable prior notice.
(d) Any Lender may at any time, without the consent of, or notice
to, Borrower or Administrative Agent, sell participations to any Person (other
than a natural person or Borrower or any of Borrower's Affiliates or
Subsidiaries) (each, a "PARTICIPANT") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or Borrowings and participations in L/C Obligations 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) Borrower,
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, waiver or other modification
described in the first proviso to SECTION 13.11(a) that directly affects such
Participant. Subject to SECTION 13.13(e), Borrower agrees that each Participant
shall be entitled to the benefits of SECTIONS 4.1, 4.5, and 4.6 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to SECTION 13.13(b).
(e) A Participant shall not be entitled to receive any greater
payment under SECTIONS 4.1 or 4.5 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 Borrower's
prior written consent. A Participant that would be a Lender that is not a
"United States person" within the meaning of Section 7701(a)(30) of the Tax
Code, if it were a Lender shall not be entitled to the benefits of SECTION 4.6
unless Borrower is notified of the participation sold to such Participant and
such Participant agrees, for the benefit of Borrower, to comply with SECTION 4.6
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 (including
under its Note, if any) to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
(g) As used herein, the following terms have the following
meanings:
APPROVED FUND means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender, or (c) an entity or an Affiliate
of an entity that administers or manages a Lender.
ELIGIBLE ASSIGNEE means: (a) a Lender; (b) an Affiliate of a Lender;
(c) an Approved Fund; and (d) any other Person (other than a natural
person) approved by (i) Administrative Agent (provided
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
60
that Administrative Agent shall not give such approval of any such
other Person unless such other Person has a combined capital and
surplus of at least $250,000,000 and has among its usual business
activities the issuance of or the purchase of participations in letters
of credit), and (ii) unless an Event of Default has occurred and is
continuing, Borrower (each such approval not to be unreasonably
withheld or delayed); provided that notwithstanding the foregoing,
"Eligible Assignee" shall not include Borrower or any of Borrower's
Affiliates or Subsidiaries.
FUND means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary
course of its business.
(h) Notwithstanding anything to the contrary contained herein, any
Lender that is a Fund may create a security interest in all or any portion of
the Borrowings owing to it and the Note, if any, held by it to the trustee for
holders of obligations owed, or securities issued, by such Fund as security for
such obligations or securities, provided that unless and until such trustee
actually becomes a Lender in compliance with the other provisions of this
SECTION 13.13, (i) no such pledge shall release the pledging Lender from any of
its obligations under the Loan Documents and (ii) such trustee shall not be
entitled to exercise any of the rights of a Lender under the Loan Documents even
though such trustee may have acquired ownership rights with respect to the
pledged interest through foreclosure or otherwise.
13.14 DISCHARGE ONLY UPON PAYMENT IN FULL; REINSTATEMENT IN CERTAIN
CIRCUMSTANCES. The obligations of Borrower under the Loan Documents shall remain
in full force and effect until termination of the Total Commitment and payment
in full of the Principal Debt and of all interest, fees, and other amounts of
the Obligation then due and owing, except that SECTIONS 4, 11, and 13, and any
other provisions under the Loan Documents expressly intended to survive by the
terms hereof or by the terms of the applicable Loan Documents, shall survive
such termination. If at any time any payment of the principal of or interest on
any Note or any other amount payable by Borrower under any Loan Document is
rescinded or must be otherwise restored or returned upon the insolvency,
bankruptcy, or reorganization of any Company or otherwise, then the obligations
of Borrower under the Loan Documents with respect to such payment shall be
reinstated as though such payment had been due but not made at such time.
13.15 CONFIDENTIALITY. Each of Administrative Agent and 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), (b) to the
extent requested by any regulatory authority (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or
the enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this SECTION 13.15, 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 Borrower and its obligations, (g) with the
consent of Borrower, or (h) to the extent such Information (x) becomes publicly
available other than as a result of a breach of this SECTION 13.15 or (y)
becomes available to Administrative Agent or any Lender on a nonconfidential
basis from a source other than Borrower. For purposes of this Section,
"INFORMATION" means all information received from any Company relating to any
Company or any of
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
61
their respective businesses, other than any such information that is available
to Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by any Company, provided that, in the case of information received
from a Company 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 13.15 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.
Notwithstanding anything herein to the contrary, "INFORMATION" shall not
include, and each party hereto may disclose without limitation of any kind, any
information with respect to the "tax treatment" and "tax structure" (in each
case, within the meaning of Treasury Regulation Section 1.6011-4) of the
transactions contemplated hereby and all materials of any kind (including
opinions or other tax analyses) that are provided to such party relating to such
tax treatment and tax structure; provided that with respect to any document or
similar item that in either case contains information concerning the tax
treatment or tax structure of the transaction as well as other information, this
sentence shall only apply to such portions of the document or similar item that
relate to the tax treatment or tax structure of the Borrowings, and transactions
contemplated hereby.
[REMAINDER OF PAGE INTENTIONALLY BLANK; SIGNATURE PAGES FOLLOW]
LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT
62
EXECUTED as of the first date written above.
CENTEX CORPORATION,
as Borrower
By: -s- Vicki A. Roberts
--------------------------------
Vicki A. Roberts
Vice President and Treasurer
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
BANK OF AMERICA, N.A., as Administrative Agent
and as a Lender
By: -s- Mark Lariviere
--------------------------------
Mark Lariviere
Managing Director
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
BANK ONE, NA, as Syndication Agent and as a
Lender
By: -s- James P. Krcmarik
--------------------------------
Name: James P. Krcmarik
Title: Associate Director
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
JPMORGAN CHASE BANK, as a Lender
By: -s- David L. Howard
--------------------------------
Name: David L. Howard
Title: Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
THE ROYAL BANK OF SCOTLAND PLC,
as a Lender
By: -s- David Apps
--------------------------------
Name: David Apps
Title: Senior Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
BNP PARIBAS, as a Lender
By: -s- Jeff Tebeaux
--------------------------------
Name: Jeff Tebeaux
Title: Vice President
Henry F. Setina
--------------------------------
Henry F. Setina
Director
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
CREDIT LYONNAIS NEW YORK BRANCH,
as a Lender
By: -s- Attila Koc
--------------------------------
Name: Attila Koc
Title: Senior Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
CREDIT SUISSE FIRST BOSTON, ACTING
THROUGH ITS CAYMAN ISLANDS BRANCH,
as a Lender
By: -s- Bill O'Daly
--------------------------------
Name: Bill O'Daly
Title: Director
By: Cassandra Droogan
--------------------------------
Name: Cassandra Droogan
Title: Associate
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
SUNTRUST BANK, as a Lender
By: -s- W. John Wendler
--------------------------------
Name: W. John Wendler
Title: Director
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
THE BANK OF TOKYO-MITSUBISHI, LTD.,
as a Lender
By: -s- John M. Mearns
--------------------------------
Name: John M. Mearns
Title: Vice President and Manager
By: -s- Brenda S. Trader
--------------------------------
Name: Brenda S. Trader
Title: Banking Officer
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
COMERICA BANK, as a Lender
By: -s- Casey L. Ostrander
--------------------------------
Name: Casey L. Ostrander
Title: Assistant Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
WASHINGTON MUTUAL BANK, FA,
as a Lender
By: -s- [ILLEGIBLE]
--------------------------------
Name: [ILLEGIBLE]
Title: Senior Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
LLOYDS TSB BANK, PLC,
as a Lender
By: -s- Windsor R. Davies
--------------------------------
Name: Windsor R. Davies
Title: Director, Corporate Banking, USA
D061
By: -s- Richard M. Heath
--------------------------------
Name: Richard M. Heath
Title: Vice President, Corporate Banking, USA
H009
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
PNC BANK, NATIONAL ASSOCIATION,
as a Lender
By: -s- Douglas G. Paul
--------------------------------
Name: Douglas G. Paul
Title: Senior Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
BANCA DI ROMA - CHICAGO BRANCH,
as a Lender
By: -s- Joyce Montgomery
--------------------------------
Name: Joyce Montgomery
Title: Vice President
By: -s- Aurora Pensa
--------------------------------
Name: Aurora Pensa
Title: Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
UBS AG, CAYMAN ISLANDS BRANCH,
as a Lender
By: -s- Patricia O'Kicki
--------------------------------
Name: Patricia O'Kicki
Title: Director
By: -s- Wilfred V. Saint
--------------------------------
Name: Wilfred V. Saint
Title: Associate Director
Banking Products
Services, US
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
THE NORTHERN TRUST COMPANY,
as a Lender
By: -s- Paul H. Theiss
--------------------------------
Name: Paul H. Theiss
Title: Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
US BANK NATIONAL ASSOCIATION,
as a Lender
By: -s- Joseph L. Sooter, Jr.
--------------------------------
Name: Joseph L. Sooter, Jr.
Title: Vice President
SIGNATURE PAGE TO CENTEX CORPORATION
LETTER OF CREDIT AND REIMBURSEMENT CREDIT AGREEMENT
[LETTER OF CREDIT]
EXHIBIT A
FORM OF PROMISSORY NOTE
$_______________ August 7, 2003
FOR VALUE RECEIVED, the undersigned, CENTEX CORPORATION, a Nevada
corporation ("BORROWER"), hereby promises to pay to the order of
_______________________ ("LENDER"), at the offices of BANK OF AMERICA, N.A., as
Administrative Agent for Lender and others as hereinafter described, on the
Repayment Date for each Borrowing, the lesser of (i) _____________________
($____________) and (ii) the aggregate principal amount of such Borrowing
disbursed by Lender to Borrower and outstanding and unpaid on such Repayment
Date (together with accrued and unpaid interest thereon).
This note has been executed and delivered under, and is subject to the
terms of, the Letter of Credit and Reimbursement Agreement dated as of August 7,
2003 (as amended, modified, supplemented, or restated from time to time, the
"AGREEMENT"), among Borrower, Lender and other lenders named therein, and
Agents, and is one of the "Notes" referred to therein. Unless defined herein,
capitalized terms used herein that are defined in the Agreement have the meaning
given to such terms in the Agreement. Reference is made to the Agreement for
provisions affecting this note regarding applicable interest rates, principal
and interest payment dates, final maturity, voluntary and mandatory prepayments,
acceleration of maturity, exercise of Rights, payment of attorneys' fees, court
costs and other costs of collection, certain waivers by Borrower and others now
or hereafter obligated for payment of any sums due hereunder and security for
the payment hereof. Without limiting the immediately preceding sentence,
reference is made to SECTION 3.6 of the Agreement for usury savings provisions.
THE LAWS OF THE STATE OF TEXAS AND OF THE UNITED STATES OF AMERICA
SHALL GOVERN THE RIGHTS AND DUTIES OF BORROWER AND LENDER AND THE VALIDITY,
CONSTRUCTION, ENFORCEMENT, AND INTERPRETATION HEREOF.
CENTEX CORPORATION
By __________________________________
Name: ___________________________
Title: ___________________________
CENTEX EXHIBITS AND SCHEDULES
1
[LETTER OF CREDIT]
EXHIBIT B
FORM OF COMPLIANCE CERTIFICATE
(Centex Corporation)
DATE: _________________, ________
SUBJECT PERIOD: __________ended ________________, ______
ADMINISTRATIVE AGENT: Bank of America, N.A.
BORROWER: Centex Corporation
This certificate is delivered under the Letter of Credit and
Reimbursement Agreement, dated as of August 7, 2003 (as amended, modified,
supplemented, or restated from time to time, the "CREDIT AGREEMENT"), among
Borrower, Administrative Agent, and other Agents and Lenders party thereto.
Capitalized terms used herein and not otherwise defined herein shall have the
meaning given to such terms in the Credit Agreement.
The undersigned certifies to Lenders that:
(a) the undersigned is a Responsible Officer of Borrower in the
position(s) set forth under the signature below;
(b) the Financial Statements of the Companies attached to this
certificate were prepared in accordance with GAAP, and present fairly in all
material respects the consolidated financial condition and results of operations
of the Companies as of, and for the [three, six, or nine months, or fiscal year]
ended on, ____________, _____(the "SUBJECT PERIOD") [(subject only to normal
year-end audit adjustments)];
(c) a review of the activities of the Companies during the Subject
Period has been made under my supervision with a view to determining whether,
during the Subject Period, the Companies have kept, observed, performed, and
fulfilled all of their respective obligations under the Loan Documents, and
during the Subject Period, (i) the Companies kept, observed, performed, and
fulfilled each and every covenant and condition of the Loan Documents (except
for the deviations, if any, set forth on ANNEX A to this certificate) in all
material respects, and (ii) no Event of Default (nor any Potential Default) has
occurred which has not been cured or waived (except the Events of Default or
Potential Defaults, if any, described on ANNEX A to this certificate);
(d) the status of compliance by Borrower with SECTION 9.12(a),
(b), and (c) of the Credit Agreement at the end of the Subject Period is as set
forth on ANNEX B to this certificate; and
(e) during the Subject Period, each Schedule to each Loan Document
that was required to be revised and supplied to Administrative Agent in
accordance with the terms of the Loan Documents has been so revised and
supplied.
CENTEX EXHIBITS AND SCHEDULES
2
[LETTER OF CREDIT]
[Signature of Responsible Officer of Borrower]
By __________________________________
Name: ___________________________
Title: ___________________________
CENTEX EXHIBITS AND SCHEDULES
3
[LETTER OF CREDIT]
ANNEX A TO COMPLIANCE CERTIFICATE
DEVIATIONS FROM LOAN DOCUMENTS/
DEFAULTS OR POTENTIAL DEFAULTS
(If none, so state.)
CENTEX EXHIBITS AND SCHEDULES
4
[LETTER OF CREDIT]
ANNEX B TO COMPLIANCE CERTIFICATE
(Centex Corporation)
Status of Compliance with SECTION 9.12(a),
(b) and (c)of the Credit Agreement (1)
Borrower shall provide to Administrative Agent (for the benefit of
Lenders) detailed calculations, in form and substance reasonably acceptable to
Administrative Agent, demonstrating compliance with the following covenants:
SECTION 9.3 INDEBTEDNESS OF RESTRICTED SUBSIDIARIES
SECTION 9.12(a) LEVERAGE RATIO
SECTION 9.12(b) INTEREST COVERAGE
SECTION 9.12(c) MINIMUM TANGIBLE NET WORTH
(1) All as more particularly determined in accordance with the terms of the
Credit Agreement, which control in the event of conflicts with this
form.
CENTEX EXHIBITS AND SCHEDULES
5
[LETTER OF CREDIT]
EXHIBIT C
FORM OF NOTICE OF CONVERSION/CONTINUATION
_________________, ____
Bank of America, N.A.
as Administrative Agent for the
Lenders as defined in the Credit
Agreement referred to below
901 Main Street, 14th Floor
Dallas, Texas 75202
Attn: Taelitha Harris
Phone: 214.209.3645
Fax: 214.290.9644
Reference is made to (i) the Letter of Credit and Reimbursement
Agreement, dated as of August 7, 2003 (as amended, modified, supplemented, or
restated from time to time, "AGREEMENT"), among the undersigned, the Lenders
named therein, and Agents. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Agreement.
The undersigned hereby gives you notice pursuant to SECTION 2.1(c)(iii) of the
Agreement that it elects to Convert a Borrowing from one Type to another Type or
elects to Continue a Borrowing and select a new Interest Period for a Eurodollar
Borrowing, and in that connection, sets forth below the terms on which such
Conversion or Continuation is requested to be made:
(A) Date of Borrowing* (A) ________________
(B) Amount of Borrowing (B) ________________
(C) Type of Borrowing** (C) ________________
(D) For Conversion to, or Continuation of, a Eurodollar (D) ________________
Borrowing, the Interest Period and the last day
thereof***
On the date the rate is set, please confirm the interest rate below and
return by facsimile transmission to ___________________.
Very truly yours,
CENTEX CORPORATION
By __________________________________
Name: ___________________________
Title: ___________________________
Facility Rate: ______________________
Confirmed by: _______________________________
CENTEX EXHIBITS AND SCHEDULES
6
[LETTER OF CREDIT]
* Must be a Business Day at least three (3) Business Days following
receipt by Administrative Agent of this Notice of
Conversion/Continuation.
** Eurodollar Borrowing or Prime Rate Borrowing.
*** Eurodollar Borrowing - 14 days or 1 month. In no event may the Interest
Period end after the applicable scheduled repayment date of such
Borrowing or Letter of Credit Expiration Date.
CENTEX EXHIBITS AND SCHEDULES
7
[LETTER OF CREDIT]
EXHIBIT D
FORM OF OPINION OF COUNSEL
The opinion delivered by counsel to Borrower must be in form and
substance acceptable to Administrative Agent and its special counsel and cover
the following matters:
1. Borrower is duly incorporated, validly existing, and in good
standing under the Legal Requirements of the State of Nevada.
2. Borrower is duly qualified to transact business and is in good
standing as a foreign corporation in the State of Texas and in each other
jurisdiction where, to the best of that counsel's knowledge, the nature and
extent of Borrower's business and properties require due qualification and good
standing.
3. Borrower possesses all requisite corporate power and authority
to conduct its business as is now being, or is contemplated by the Credit
Agreement to be, conducted.
4. The execution and delivery by Borrower of each Loan Document
to which it is a party and the performance by it of its obligations thereunder,
(a) are within its corporate power, (b) have been duly authorized by all
necessary corporate action on its behalf, (c) except for any action or filing
that has been taken or made on or before the date of this opinion, and the
filing of the Loan Documents with the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934, require no action by or filing
with any Governmental Authority, (d) do not violate any provision of its
Constituent Documents, (e) do not to the best knowledge of counsel after
reasonable inquiry violate any Legal Requirement applicable to it or, to the
best knowledge of counsel after reasonable inquiry, any material agreements to
which it is a party and of which counsel is aware, and (f) do not result in the
creation or imposition of any Lien on any asset of Borrower pursuant to a
material agreement of Borrower of which counsel is aware.
5. Upon execution and delivery by all parties to it, each Loan
Document will constitute a legal and binding obligation of Borrower, enforceable
against it in accordance with its terms, except as enforceability may be limited
by applicable Debtor Relief Laws and general principles of equity.
6. To the best knowledge of counsel after reasonable inquiry, (a)
no Company is subject to, or aware of the threat of, any Litigation that is
reasonably likely to be determined adversely to it and, if so adversely
determined, would be a Material Adverse Event, and (b) no outstanding or unpaid
judgments against any Company exist that could be a Material Adverse Event.
CENTEX EXHIBITS AND SCHEDULES
8
[LETTER OF CREDIT]
EXHIBIT E
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption (this "ASSIGNMENT AND ASSUMPTION") is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] ("ASSIGNOR") and [Insert name of Assignee] ("ASSIGNEE").
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (the "CREDIT AGREEMENT"), receipt
of a copy of which is hereby acknowledged by 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, Assignor hereby irrevocably sells and assigns to
Assignee, and Assignee hereby irrevocably purchases and assumes from Assignor,
subject to and in accordance with the Standard Terms and Conditions and the
Credit Agreement (including Section 13.13(b) thereof), as of the Effective Date
inserted by Administrative Agent as contemplated below (i) all of Assignor's
rights and obligations 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 Assignor under the facility identified below
(including, without limitation, Letters of Credit under such facility) and (ii)
to the extent permitted to be assigned under applicable law, all claims, suits,
causes of action, and any other right of 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, but not limited to, 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 Assignor
and, except as expressly provided in this Assignment and Assumption, without
representation or warranty by Assignor.
1. Assignor: ________________________________________
2. Assignee: ________________________________________ [and is an
Affiliate/Approved Fund of [identify Lender]1]
3. Borrower: Centex Corporation, a Nevada corporation
4. Administrative Agent: Bank of America, N.A., as the administrative
agent under the Credit Agreement
5. Credit Agreement: The Letter of Credit and Reimbursement Agreement,
dated as of August 7, 2003, among Centex
Corporation, the Lenders parties thereto, Bank
of America, N.A., as Administrative Agent
______________________________
1 Select as applicable.
CENTEX EXHIBITS AND SCHEDULES
9
[LETTER OF CREDIT]
6. Assigned Interest:
Total Amount of Percentage
Commitment/Borrowings Commitment/Borrowings Assigned of
Facility Assigned for all Lenders* Assigned* Commitment/Borrowings2
- ----------------- --------------------- ---------------------- ----------------------
_____________ $____________________ $____________________ ______________________%
_____________ $____________________ $____________________ ______________________%
_____________ $____________________ $____________________ ______________________%
[7. Trade Date __________________]3
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 terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
--------
[NAME OF ASSIGNOR]
By __________________________________
Title: ___________________________
ASSIGNEE
--------
[NAME OF ASSIGNEE]
By: _____________________________
Title:
Consented to and Accepted:
BANK OF AMERICA, N.A., as Administrative Agent
By: _________________________________
Title:
[Consented to and Accepted:
CENTEX CORPORATION, a Nevada corporation
By: _________________________________
Title:]
_________________________
* Amount to be adjusted by the counterparties to take into account any
payments or prepayments made between the Trade Date and the Effective Date.
2 Set forth, to at least 9 decimals, as a percentage of the
Commitment/Borrowings of all Lenders thereunder.
3 To be completed if Assignor and Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date.
CENTEX EXHIBITS AND SCHEDULES
10
[LETTER OF CREDIT]
ANNEX 1 TO ASSIGNMENT AND ASSUMPTION
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1. Assignor. 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 Loan Document, (ii) the execution,
legality, validity, enforceability, genuineness, sufficiency, or value of the
Loan Documents or any collateral thereunder, (iii) the financial condition of
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document, or (iv) the performance or observance by the
Borrower, any of its Subsidiaries or Affiliates, or any other Person of any of
their respective obligations under any Loan Document.
1.2. Assignee. 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
meets all requirements of an Eligible Assignee under the Credit Agreement
(subject to receipt of such consents as may be required under the Credit
Agreement), (iii) from and after the Effective Date, it shall be bound by 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 8.3 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 Administrative Agent or any other Lender, and (v) if it is a Lender that is
not a "United States person" within the meaning of Section 7701(a)(30) of the
Tax Code, attached hereto is any documentation required to be delivered by it
pursuant to the terms of the Credit Agreement, duly completed and executed by
Assignee; and (b) agrees that (i) it will, independently and without reliance on
Administrative Agent, Assignor or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Loan Documents,
and (ii) it will perform in accordance with their terms all of the obligations
which by the terms of the Loan Documents are required to be performed by it as a
Lender.
2. Payments. From and after the Effective Date, Administrative
Agent shall make all payments in respect of the Assigned interest (including
payments of principal, interest, fees and other amounts) to Assignee whether
such amounts have accrued prior to or on or after the Effective Date. The
Assignor and Assignee shall make all appropriate adjustments in payments by
Administrative Agent for periods prior to the Effective Date or with respect to
the making of this assignment directly between themselves.
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
CENTEX EXHIBITS AND SCHEDULES
11
[LETTER OF CREDIT]
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 law of the State of Texas.
CENTEX EXHIBITS AND SCHEDULES
12
[LETTER OF CREDIT]
SCHEDULE 1.1
EXISTING LETTERS OF CREDIT
ISSUE EXPIRATION AMOUNT
ISSUER L/C # DATE DATE APPLICANT BENEFICIARY $
- -------------------------- -------------- -------- ---------- ---------------- ------------------------------------- -------------
Bank of America, N.A. 00000000916355 12/20/98 12/19/03 Centex Homes Travelers Casualty A 1,900,000.00
Bank of America, N.A. 00000003054936 03/19/03 03/14/04 Centex Homes Donlen Trust 500,000.00
Bank of America, N.A. 00000003704341 12/01/00 12/01/03 Centex Homes Mullrock Mortgage 245,000.00
Bank of America, N.A. 00000003704342 01/23/01 01/19/04 Centex Homes Enterprise Leasing 500,000.00
Bank of America, N.A. 00000003704347 03/01/01 02/27/04 Centex Homes Old Republic Insurance 1,000,000.00
Bank of America, N.A. 00000003704362 05/31/01 05/31/04 Centex Homes Enterprise Leasing 500,000.00
Bank of America, N.A. 00000003704363 06/06/01 06/01/04 Centex Homes City of Longmont 672,367.00
Bank of America, N.A. 00000003704367 06/27/01 06/13/04 Centex Homes Liberty Mutual Insurance 647,160.00
Bank of America, N.A. 00000003704389 11/14/01 11/14/03 Centex Homes ZurichAmerican Insurance 7,000,000.00
Bank of America, N.A. 00000003704392 12/10/01 12/10/03 Centex Homes Comerica Bank Texas 1,195,650.00
Bank of America, N.A. 00000003704393 12/04/01 12/05/03 Centex Homes Arbor Commercial Mort. 354,671.00
Bank of America, N.A. 00000003704394 12/04/01 12/05/03 Centex Homes Arbor Commercial Mort. 154,472.00
Bank of America, N.A. 00000003704403 08/08/02 08/06/03 Centex Homes Liberty Mutual Insurance 400,000.00
Bank of America, N.A. 00000000113767 10/02/99 10/01/03 Centex Homes Commissioner of Insurance 250,000.000
Bank of America, N.A. 00000003054810 03/17/03 03/17/04 Centex Homes Palmetto Glen, LLC 50,000.00
Bank of America, N.A. 00000003055540 04/16/03 10/31/04 Centex Homes Union County 755,631.87
Bank of America, N.A. 00000003056164 05/16/03 05/15/04 Centex Homes City of Boynton Beach 25,047.00
Bank of America, N.A. 00000003055469 05/30/03 05/28/04 Centex Homes City of Boynton Beach 5,997.00
Bank of America, N.A. 00000003056601 06/05/03 06/03/04 Centex Homes City of Lake St. Louis 10,000.00
Bank of America, N.A. 00000003056852 06/16/03 06/16/04 Centex Homes St. Louis County, MI 412,312.95
Bank of America, N.A. 00000003056853 06/16/03 06/16/04 Centex Homes St. Louis County, MI 154,143.68
Bank of America, N.A. 00000003056854 06/16/03 06/16/04 Centex Homes St. Louis County, MI 24,175.30
Bank of America, N.A. 00000003056855 06/16/03 06/16/04 Centex Homes St. Louis County, MI 52,878.23
Bank of America, N.A. 00000003056856 06/16/03 06/16/04 Centex Homes St. Louis County, MI 25,558.92
Bank of America, N.A. 00000003056857 06/16/03 06/16/04 Centex Homes St. Louis County, MI 578,871.49
Bank of America, N.A. 00000003056858 06/16/03 06/16/04 Centex Homes St. Louis County, MI 365,117.35
Bank of America, N.A. 00000003057016 06/20/03 06/20/04 Centex Homes Horry County 627,827.56
Bank of America, N.A. 00000003057017 06/20/03 06/20/04 Centex Homes Horry County 614,535.60
Bank of America, N.A. 00000003057299 07/02/03 07/01/04 Centex Homes County of Lexington 121,675.00
Bank of America, N.A. 00000003057300 07/02/03 07/01/04 Centex Homes County of Lexington 154,249.00
Bank of America, N.A. 00000003057331 07/08/03 07/08/04 Centex Homes St. Louis County, MI 190,872.40
Bank of America, N.A. 00000003057332 07/08/03 07/08/04 Centex Homes St. Louis County, MI 387,144.92
Bank of America, N.A. 00000003704335 08/24/00 09/01/03 Centex Homes Board of County Comm. 110,049.00
Bank of America, N.A. 00000003704336 08/24/00 09/01/03 Centex Homes Board of County Comm. 942,731.00
Bank of America, N.A. 00000003704337 08/25/00 09/01/03 Centex Homes City of Farmington 164,900.00
Bank of America, N.A. 00000003704354 05/18/01 09/01/03 Centex Homes Town of Mount Pleasant 24,215.63
Bank of America, N.A. 00000003704355 05/25/01 05/22/04 Centex Homes Charter Township of 24,620.00
Bank of America, N.A. 00000003704356 05/25/01 10/22/03 Centex Homes Washtenaw County Roa 170,368.00
Bank of America, N.A. 00000003704358 05/25/01 10/22/03 Centex Homes Washtenaw County Dra 286,080.00
Bank of America, N.A. 00000003704364 06/11/01 02/01/04 Centex Homes City of Maple Grove 154,800.00
Bank of America, N.A. 00000003704366 06/13/01 12/12/03 Centex Homes City of Longmont 88,815.40
Bank of America, N.A. 00000003704368 06/20/01 12/22/03 Centex Homes City of Rosemount 9,020.00
Bank of America, N.A. 00000003704369 06/20/01 12/15/03 Centex Homes City of Rosemount 30,800.00
Bank of America, N.A. 00000003704372 06/20/01 06/20/04 Centex Homes Raritan Township 60,000.00
Bank of America, N.A. 00000003704374 07/06/01 06/30/04 Centex Homes City of Farmington 33,500.00
Bank of America, N.A. 00000003704375 07/06/01 08/15/03 Centex Homes Town of Mount Pleasant 25,138.12
Bank of America, N.A. 00000003704378 08/02/01 08/29/03 Centex Homes City of Raleigh 24,026.67
CENTEX EXHIBITS AND SCHEDULES
13
[LETTER OF CREDIT]
ISSUE EXPIRATION AMOUNT
ISSUER L/C # DATE DATE APPLICANT BENEFICIARY $
- -------------------------- -------------- -------- ---------- ---------------- ------------------------------------- -------------
Bank of America, N.A. 00000003704383 09/25/01 09/26/03 Centex Homes Town of Mount Pleasant 35,901.00
Bank of America, N.A. 00000003704385 10/31/01 06/03/04 Centex Homes County of Lexington 48,900.00
Bank of America, N.A. 00000003704388 11/15/01 12/31/03 Centex Homes The City of Inver Gr 47,685.00
Bank of America, N.A. 00000003704391 11/29/01 11/28/03 Centex Homes City of Raleigh 45,121.22
Bank of America, N.A. 00000003704404 08/19/02 12/31/03 Centex Homes The City of Inver Gr 221,385.62
Bank of America, N.A. 00000003704405 08/21/02 08/20/03 Centex Homes Round Lake Development 1,550,218.00
Bank of America, N.A. 00000003704407 10/08/02 10/07/03 Centex Homes City of Rosemount 90,000.00
Bank of America, N.A. 00000003704408 10/07/02 10/04/03 Centex Homes Union County 372,559.00
Bank of America, N.A. 00000003704409 10/07/02 10/04/03 Centex Homes Union County 13,553.00
Bank of America, N.A. 00000003704410 10/07/02 10/04/03 Centex Homes Union County 330,745.00
Bank of America, N.A. 00000003704411 10/07/02 10/04/03 Centex Homes Union County 19,440.00
Bank of America, N.A. 00000003704412 10/28/02 10/24/03 Centex Homes Jackson Point Development 50,000.00
Bank of America, N.A. 00000003704413 01/15/03 05/01/04 Centex Homes County of Lexington 37,000.00
Bank of America, N.A. 00000003710150 01/31/03 01/27/04 Centex Homes Walker Title & Escrow 225,000.00
Bank of America, N.A. 00000003710151 02/03/03 01/30/04 Centex Homes City of Raleigh 46,754.55
Bank One, NA 00327902 07/01/03 07/01/04 Centex Homes Union County 171,541.90
Bank One, NA 00327908 07/01/03 07/01/04 Centex Homes Union County 7,863.00
Bank One, NA 00327883 12/31/02 12/30/04 Centex Homes The Stagecoach Valley, Ltd. 71,000.00
Bank One, NA 00327885 01/30/03 01/27/05 Centex Homes 439 Development, Ltd. 290,000.00
Bank One, NA 00327894 04/15/03 04/14/04 Centex Homes City of Elk River 100,000.00
Bank One, NA 00327886 04/15/03 04/10/04 Centex Homes City of Maple Grove 233,000.00
Bank One, NA 00327910 07/25/03 12/18/03 Centex Homes Commerce Title Co. 340,000.000
Bank One, NA 00327895 04/15/03 04/14/04 Centex Homes City of Elk River 861,000.00
Bank One, NA 00327888 03/07/03 03/05/04 Centex Homes Tappey Bartholow Squires 150,000.00
Bank One, NA 00327889 03/07/03 03/05/04 Centex Homes Mobile Shelters Land Holding, LLC 175,000.00
Bank One, NA 00327890 03/17/03 03/28/04 Centex Homes City of Raleigh 73,071.42
Bank One, NA 00327901 06/06/03 01/06/05 Centex Homes City of Oregon City 69,953.00
Bank One, NA 00327909 07/22/03 07/18/04 Centex Homes Village of Shiloh 50,000.00
Bank One, NA 00327900 04/25/03 04/25/05 Centex Homes W & B Development, Ltd. 285,000.00
Bank One, NA 00327907 07/01/03 07/01/04 Centex Homes Union County 205,454.45
Bank One, NA 00327904 07/01/03 07/01/04 Centex Homes Union County 10,261.00
Bank One, NA 00327905 07/01/03 07/01/04 Centex Homes Union County 109,367.35
Bank One, NA 00327906 07/01/03 07/01/04 Centex Homes Union County 14,673.00
Bank One, NA 00327903 06/26/03 09/30/03 Centex Homes Boulder County Transportation Dept. 14,816.60
Bank One, NA 00313940 05/04/92 05/04/04 Centex Homes County of Loudoun 73,000.000
Bank One, NA 00313941 05/04/92 05/04/04 Centex Homes County of Loudoun 140,000.000
Bank One, NA 00313942 05/04/92 05/04/04 Centex Homes County of Loudoun 87,000.000
Bank One, NA 00318612 07/20/00 07/24/04 Centex Homes Shapell Industries, Inc. 532,347.04
Bank One, NA 00318615 09/05/00 02/01/04 Centex Homes City of Maplegrove 15,000.00
Bank One, NA 00318616 09/05/00 12/30/03 Centex Homes Village of Lake in the Hills 145,088.00
Bank One, NA 00318619 09/21/00 09/20/03 Centex Homes City of Longmont 370,596.50
Bank One, NA 00318624 10/23/00 12/30/03 Centex Homes Village of Lake in the Hills 334,000.00
Bank One, NA 00318625 10/23/00 12/30/03 Centex Homes Village of Lake in the Hills 125,000.00
Bank One, NA 00318626 10/26/00 09/07/03 Centex Homes City of Loveland 270,050.00
Bank One, NA 00318628 11/20/00 11/17/03 Centex Homes Metropolitan Title & Guaranty Co. 50,000.00
Bank One, NA 00318633 12/29/00 12/28/03 Centex Homes Sklpcha 1, Ltd., a Texas LP 21,000.00
Bank One, NA 00318645 08/01/01 10/19/03 Centex Homes Wayne County DPS 90,000.00
Bank One, NA 00318647 07/26/01 07/30/04 Centex Homes Charter Township of Canton 351,600.00
Bank One, NA 00318648 07/26/01 07/30/04 Centex Homes Washtenaw Co. Drain Commissioner 535,530.00
Bank One, NA 00318650 08/23/01 08/20/04 Centex Homes Washtenaw County Rd. Commission 849,343.00
Bank One, NA 00318853 09/21/01 09/25/04 Centex Homes Residential Funding Corporation 2,623,000.000
Bank One, NA 00318655 09/26/01 12/31/03 Centex Homes City of Prior Lake 289,375.00
Bank One, NA 00318656 09/24/01 09/21/03 Centex Homes Waterford Landing Hm. Owners Assc. 520,000.00
Bank One, NA 00318671 02/28/02 02/01/04 Centex Homes City of Maple Grove 135,860.00
CENTEX EXHIBITS AND SCHEDULES
14
[LETTER OF CREDIT]
ISSUE EXPIRATION AMOUNT
ISSUER L/C # DATE DATE APPLICANT BENEFICIARY $
- -------------------------- -------------- -------- ---------- ---------------- ------------------------------------- -------------
Bank One, NA 00318659 11/21/01 02/01/04 Centex Homes City of Maplegrove 17,063.00
Bank One, NA 00318661 03/21/02 12/31/03 Centex Homes Unimproved Besinger Properties 750,000.00
Bank One, NA 00318663 04/15/02 04/11/04 Centex Homes City of Oceanside 43,093.00
Bank One, NA 00318664 12/17/01 12/14/03 Centex Homes City of Rosemount 200,000.00
Bank One, NA 00318665 12/17/01 12/14/03 Centex Homes City of Rosemount 200,000.00
Bank One, NA 00318669 03/11/02 03/11/04 Centex Homes Dobson II, LLC 217,120.00
Bank One, NA 00318672 03/06/02 12/31/03 Centex Homes The Carpentersville Group 650,000.00
Bank One, NA 00318673 04/15/02 04/11/04 Centex Homes City of Oceanside 112,482.00
Bank One, NA 00318674 04/17/02 06/30/04 Centex Homes Town of Mt. Pleasant 36,825.00
Bank One, NA 00318676 05/16/02 02/01/04 Centex Homes City of Maple Grove 9,400.00
Bank One, NA 00318677 05/16/02 02/01/04 Centex Homes City of Maple Grove 83,800.00
Bank One, NA 00318678 05/16/02 02/01/04 Centex Homes City of Maple Grove 597,800.00
Bank One, NA 00318679 05/16/02 02/01/04 Centex Homes City of Maple Grove 882,500.00
Bank One, NA 00318683 06/13/02 12/22/03 Centex Homes City of Rosemount 112,750.00
Bank One, NA 00318682 05/28/02 05/28/04 Centex Homes Killeen Thunder Creek, Ltd. 237,000.00
Bank One, NA 00318684 07/01/02 08/31/03 Centex Homes Town of Mt. Pleasant 30,525.00
Bank One, NA 00318685 07/02/02 01/08/04 Centex Homes County of Lexington, So. Carolina 41,384.50
Bank One, NA 00318689 08/02/02 07/30/04 Centex Homes Union County 743,177.23
Bank One, NA 00318690 08/02/02 07/30/04 Centex Homes Union County 36,063.19
Bank One, NA 00318691 08/06/02 08/05/04 Centex Homes Waugh Chapel Limited Partnership 300,000.00
Bank One, NA 00318692 08/15/02 08/08/04 Centex Homes Union County 36,274.39
Bank One, NA 00318693 08/15/02 08/12/04 Centex Homes Union County 1,048,782.21
Bank One, NA 00318694 08/15/02 08/15/04 Centex Homes City of Westminster 778,405.76
Bank One, NA 00318695 08/15/02 08/15/04 Centex Homes City of Westminster 520,626.85
Bank One, NA 00382346 06/10/97 12/09/03 Centex Homes City of Longmont 197,374.00
Bank One, NA 00382361 08/13/97 02/01/04 Centex Homes City of Maple Grove 15,000.00
Bank One, NA 00382375 11/14/97 08/27/03 Centex Homes Town of Parker 81,097.60
Bank One, NA 00382442 08/10/98 08/10/03 Centex Homes Sandpiper Bay Land Company, Inc. 100,000.00
Bank One, NA 00382702 09/04/98 09/04/04 Centex Homes C.V. Perry & Co. 134,400.00
Bank One, NA 00382738 03/18/99 04/01/04 Centex Homes Union County 127,625.00
Bank One, NA 00327898 04/15/03 06/01/05 Centex Homes Union County 21,577.61
Bank One, NA 00327899 04/15/03 06/01/05 Centex Homes Union County 245,100.45
Bank One, NA 00382779 09/21/99 12/31/03 Centex Homes Village of North Aurora 705,592.86
Bank One, NA 00382796 03/06/00 03/01/04 Centex Homes City of Longmont 254,509.50
Bank One, NA 00327867 09/18/02 09/16/04 Centex Homes Echo Development, Ltd. 86,000.000
Bank One, NA 00327870 10/04/02 10/04/04 Centex Homes United Water Princeton Meadows 1,077,366.00
Bank One, NA 00327868 09/30/02 11/30/03 Centex Homes OXI, LLC 500,000.00
Bank One, NA 00382394 01/28/98 01/20/04 Centex Homes Blackmoor Land Development 50,000.00
Bank One, NA 00382784 10/21/99 12/31/03 Centex Homes Village of North Aurora 193,445.99
Bank One, NA 00327878 11/12/02 11/11/03 Centex Homes Village of Round Lake 1,703,576.60
Bank One, NA 00327877 11/06/02 10/30/03 Centex Homes City of Longmont 2,021,134.00
Bank One, NA 00327882 11/21/02 08/30/04 Centex Homes County of Eagle, State of Colorado 32,236.71
Bank One, NA 00327869 10/02/02 11/30/03 Centex Homes The Town of Mt. Pleasant 117,115.00
Bank One, NA 00327872 10/23/02 10/31/03 Centex Homes Wells Fargo Bank Minnesota 740,980.00
Bank One, NA 00327873 10/23/02 10/31/03 Centex Homes Wells Fargo Bank Minnesota 1,500,000.00
Bank One, NA 00327879 11/13/02 11/11/03 Centex Homes Village of Oswego 1,373,757.12
Bank One, NA 00327881 11/21/02 08/30/04 Centex Homes County of Eagle, State of Colorado 79,190.26
Bank One, NA 00327880 12/02/02 11/22/03 Centex Homes Fleet National Bank 4,478,790.00
Bank One, NA 00327884 01/13/03 01/09/04 Centex Homes The City of Wheatridge 715,549.00
Bank One, NA 00327891 04/02/03 04/02/04 Centex Homes City of Rosemount 679,000.00
Bank One, NA 00327896 04/16/03 04/10/04 Centex Homes City of Maple Grove 1,957,100.00
Bank One, NA 00327886 04/15/03 04/10/04 Centex Homes City of Maple Grove 233,000.00
Bank One, NA 00327896 04/16/03 04/10/04 Centex Homes City of Maple Grove 1,957,100.00
Banque Nationale de Paris S400150 02/04/94 02/08/04 Centex Corp. Travelers Indemnity Company 3,215,000.00
CENTEX EXHIBITS AND SCHEDULES
15
[LETTER OF CREDIT]
ISSUE EXPIRATION AMOUNT
ISSUER L/C # DATE DATE APPLICANT BENEFICIARY $
- -------------------------- -------------- -------- ---------- ---------------- ------------------------------------- -------------
Banque Nationale de Paris 91866446 01/21/03 01/31/04 Centex Corp. Zurich American Insurance Group 13,300,000.00
Comerica Bank 00000000583342 05/23/03 02/01/04 Centex Corp. City of Maple Grove 68,860.00
Comerica Bank 00000000583272 05/21/03 02/01/04 Centex Corp. City of Maple Grove 1,488,000.00
Comerica Bank 00000000583273 05/21/03 02/01/04 Centex Corp. City of Maple Grove 17,545.00
Comerica Bank 00000000583343 05/23/03 02/01/04 Centex Corp. City of Maple Grove 366,000.00
Comerica Bank 00000000583344 05/23/03 02/01/04 Centex Corp. City of Maple Grove 23,430.00
Comerica Bank 00000000583345 05/23/03 02/01/04 Centex Corp. City of Maple Grove 1,067,400.00
Comerica Bank 00000000583341 05/23/03 05/14/04 Centex Corp. Washtenaw County Rd. Commission 1,022,774.00
Comerica Bank 00000000583402 05/28/03 05/28/04 Centex Corp. Wellington Partners, LLC 725,000.00
Comerica Bank 00000000583885 06/18/03 06/17/04 Centex Corp. City of Rosemount 114,000.000
Comerica Bank 00000000584189 06/30/03 06/27/04 Centex Corp. Washtenaw County Rd. Commission 742,054.00
Comerica Bank 00000000584473 07/11/03 07/10/04 Centex Corp. Ashton Oaks, LLC 100,000.00
Comerica Bank 00000000584537 07/14/03 07/11/04 Centex Corp. City of Milan 974,314.00
Comerica Bank 00000000584301 07/07/03 07/02/04 Centex Corp. City of Rosemount 352,000.00
Comerica Bank 00000000584302 07/07/03 07/02/04 Centex Corp. City of Rosemount 268,400.00
Comerica Bank 00000000584752 07/22/03 07/23/04 Centex Corp. City of Woodbury 1,816,313.00
Comerica Bank 00000000584753 07/22/03 07/23/04 Centex Corp. City of Woodbury 54,022.20
Comerica Bank 00000000584943 07/30/03 07/30/04 Centex Corp. WalMart Stores East, LP 2,307,000.00
Comerica Bank 00000000584536 07/14/03 07/11/04 Centex Corp. Washtenaw Cnty. Drain Commission 753,918.00
JPMorgan Chase Bank D221538 01/23/02 01/17/04 Centex Corp. Zurich American Insurance Group 7,000,000.00
JPMorgan Chase Bank D220589 12/21/01 01/09/04 Centex Corp. The Travelers Indemnity Company 6,400,000.00
JPMorgan Chase Bank D291129 07/28/99 07/31/04 Centex Materials City of Austin 47,725.70
JPMorgan Chase Bank D229664 09/05/02 03/01/04 Centex Homes County of Lexington, So. Carolina 83,627.30
JPMorgan Chase Bank D229684 09/05/02 03/01/04 Centex Homes County of Lexington, So. Carolina 201,830.22
JPMorgan Chase Bank D229866 09/09/02 07/31/03 Centex Homes Nextly Bank Myrtle Beach LPO 750,000.00
JPMorgan Chase Bank D230276 09/20/02 09/19/03 Centex Homes Residential Funding Corp. 1,364,450.00
JPMorgan Chase Bank D233345 12/26/02 12/31/03 Home Services Old Republic Insurance Company 3,000,000.00
JPMorgan Chase Bank D234681 02/10/03 01/31/04 Centex Devlpmnt. Industrial Properties Corporation 1,000,000.00
SunTrust Bank F503221 03/07/02 03/01/04 Centex Homes Liberty Mutual Insurance Company 319,680.00
SunTrust Bank F503235 03/25/02 03/22/04 Centex Homes Anne Arundel County 152,423.00
SunTrust Bank F840258 12/12/02 12/12/03 Centex Homes Liberty Mutual Insurance Company 250,000.00
SunTrust Bank F841319 06/02/03 05/30/04 Centex Homes Riverwalk at Occoquan, Inc. 40,000.00
SunTrust Bank F841581 07/16/03 07/15/04 Centex Homes Walker Title & Escrow Company 600,000.00
SunTrust Bank P000019 10/24/02 10/18/03 Centex Homes County of York 112,000.00
SunTrust Bank P000040 10/31/02 10/28/03 Centex Homes City of Spring Hill 1,191,000.00
SunTrust Bank P000072 11/18/02 10/30/03 Centex Homes Orange County Board of 2,383.00
SunTrust Bank P000073 11/18/02 10/30/03 Centex Homes Orange County Board of 14,431.00
SunTrust Bank P000126 12/12/02 12/12/04 Centex Homes City of Mt. Juliet 296,624.00
SunTrust Bank P000127 12/12/02 12/12/04 Centex Homes City of Mr. Juliet 32,571.00
SunTrust Bank P000180 12/31/02 12/30/03 Centex Homes Orange County Commissioners 125,000.00
SunTrust Bank P000184 01/06/03 12/23/03 Centex Homes Union County 415,863.55
SunTrust Bank P000185 01/06/03 12/23/03 Centex Homes Union County 22,812.80
SunTrust Bank P000187 01/06/03 02/28/04 Centex Homes Orange County Board of 5,252.00
SunTrust Bank P000210 01/13/03 02/28/04 Centex Homes Orange County Board of 6,030.00
SunTrust Bank P000262 01/30/03 5/01/04 Centex Homes County of York 42,000.00
SunTrust Bank P000321 02/19/03 09/30/03 Centex Homes Orange County Board of 300,000.00
SunTrust Bank P000360 03/05/03 02/28/04 Centex Homes Orange County Board of 169,764.10
SunTrust Bank P000379 03/11/03 03/11/04 Centex Homes Commerce Title Agency 500,000.00
SunTrust Bank P000473 04/16/03 10/31/04 Centex Homes Union County 1,008,248.07
SunTrust Bank P000474 04/16/03 10/31/04 Centex Homes Union County 196,674.04
SunTrust Bank P000475 04/16/03 06/30/04 Centex Homes Union County 40,250.00
SunTrust Bank P000487 04/25/03 12/31/04 Centex Homes City of Inver Grove Heights 2,447,998.00
SunTrust Bank P000495 04/28/03 04/28/04 Centex Homes County of York 2,150,000.00
SunTrust Bank P000635 07/10/03 07/09/04 Centex Homes West Wilson Utility District 282,200.00
CENTEX EXHIBITS AND SCHEDULES
16
[LETTER OF CREDIT]
ISSUE EXPIRATION AMOUNT
ISSUER L/C # DATE DATE APPLICANT BENEFICIARY $
- -------------------------- -------------- -------- ---------- ---------------- ------------------------------------- -------------
SunTrust Bank P000685 08/04/03 02/04/04 Centex Homes South Valley Sewer District 145,794.00
SunTrust Bank P600896 12/15/99 02/01/04 Centex Homes City of Maple Grove 3,000.00
SunTrust Bank P601230 03/13/01 02/01/04 Centex Homes City of Maple Grove 25,300.00
SunTrust Bank P601250 04/11/01 04/01/04 Centex Homes Powhatan Enterprises, Inc. 133,795.00
SunTrust Bank P601253 04/13/01 04/11/04 Centex Homes City of Brentwood 6,500.00
SunTrust Bank P601272 04/30/01 04/27/04 Centex Homes Williamson County Regional 72,000.00
SunTrust Bank P601275 04/30/01 04/27/04 Centex Homes City of Brentwood 6,000.00
SunTrust Bank P601403 11/07/01 11/06/03 Centex Homes City of Boynton Beach 1,291,910.00
SunTrust Bank P601447 01/29/02 12/14/03 Centex Homes Board of Supervisors of Fairfax 105,000.00
SunTrust Bank P601449 01/30/02 12/14/03 Centex Homes Board of Supervisors of Fairfax 337,100.00
SunTrust Bank P601457 02/11/02 01/31/04 Centex Homes Board of Supervisors of Fairfax 215,000.00
SunTrust Bank P601475 03/20/02 03/18/04 Centex Homes Residential Funding Corporation 2,700,000.00
SunTrust Bank P601480 03/27/02 03/27/04 Centex Homes City of Rosemount 115,000.00
SunTrust Bank P601500 04/18/02 04/17/04 Centex Homes Board of Supervisors of 161,800.00
SunTrust Bank P601501 04/18/02 10/15/03 Centex Homes King Farm Associates L.L.C. 100,000.00
SunTrust Bank P601529 05/15/02 10/30/03 Centex Homes Orange County Board of 8,010.00
SunTrust Bank P601530 05/15/02 10/30/03 Centex Homes Orange County Board of 4,140.00
SunTrust Bank P601531 05/15/02 10/30/03 Centex Homes Orange County Board of 24,864.00
SunTrust Bank P601532 05/15/02 10/30/03 Centex Homes Orange County Board of 33,108.00
SunTrust Bank P601558 06/14/02 06/14/04 Centex Homes City of Brentwood 146,150.00
SunTrust Bank P601559 06/17/02 06/03/04 Centex Homes Metropolitan Department of 23,750.00
SunTrust Bank P601571 07/02/02 10/30/03 Centex Homes Orange County Board of 61,857.00
SunTrust Bank P601609 08/29/02 01/06/04 Centex Homes West Wilson Utility District 11,566.70
SunTrust Bank P601649 10/16/02 10/11/03 Centex Homes Board of Supervisors of Fairfax 358,200.00
CENTEX EXHIBITS AND SCHEDULES
17
[LETTER OF CREDIT]
SCHEDULE 2.1
LENDERS AND COMMITMENTS; ADDRESSES FOR NOTICE
PRO RATA
NAME AND ADDRESS OF LENDERS COMMITMENT PART
Bank of America, N.A. $ 20,000,000 8.00%
Attn: Bryce Langen
NC1-007-15-06
100 N. Tryon Street
Charlotte, NC 28255
Phone: 704.387.5104
Fax: 704.386.0255
[With a copy to:
Bank of America, N.A.
Attn: Agency Management
901 Main Street, 14th Floor
Dallas, TX 75202
Phone: 214.209.4109
Fax: 214-290-9448]
Bank One, NA $ 40,000,000 16.00%
Attn: F. Patt Schiewitz
1 Bank One Plaza, Suite IL1-0315
Chicago, IL 60670
Phone: 312.732.1148
Fax: 312.732.5939
JPMorgan Chase Bank $ 20,000,000 8.00%
Attn: David L. Howard
2200 Ross Avenue, Third Floor
Dallas, TX 75201
Phone: 214.965.4756
Fax: 214.965.2044
CENTEX EXHIBITS AND SCHEDULES
18
[LETTER OF CREDIT]
PRO RATA
NAME AND ADDRESS OF LENDERS COMMITMENT PART
The Royal Bank of Scotland plc
Attn: Dave Apps $ 20,000,000 8.00%
101 Park Avenue
New York, NY 10178
Phone: 212.401.3745
Fax: 212.401.3456
BNP Paribas $ 20,000,000 8.00%
Attn: Jeff Tebeaux
12201 Merit Drive, Suite 860
Dallas, TX 75251
Phone: 214.953.9737
Fax: 972.788.9140
Credit Lyonnais New York Branch $ 20,000,000 8.00%
Attn: Robert Smith
2200 Ross Avenue, Suite 4400 West
Dallas, TX 75201
Phone: 214.220.2311
Fax: 214.220.2323
Credit Suisse First Boston, acting through its Cayman Islands Branch $ 20,000,000 8.00%
Attn: William O'Daly
Eleven Madison Avenue
New York, NY 10010
Phone: 212.325.1986
Fax: 212.743.2254
SunTrust Bank $ 20,000,000 8.00%
Attn: W. John Wendler
8245 Boone Boulevard, Suite 820
Vienna, VA 22181
Phone: 703.902.9041
Fax: 703.902.9245
CENTEX EXHIBITS AND SCHEDULES
19
[LETTER OF CREDIT]
PRO RATA
NAME AND ADDRESS OF LENDERS COMMITMENT PART
The Bank of Tokyo-Mitsubishi, Ltd. $ 12,500,000 5.00%
Attn: John Mearns / Brenda Trader
2001 Ross Avenue, Suite 3150
Dallas, TX 75201
Phone: 214.954.1200 ext. 104 / ext. 111
Fax: 214.954.1007
Comerica Bank $ 12,500,000 5.00%
Attn: Casey L. Ostrander
500 Woodward Avenue, 7th Floor
MC: 3256
Detroit, MI 48226
Phone: 313.222.5286
Fax: 313.222.9295
Washington Mutual Bank, FA $ 12,500,000 5.00%
Attn: Mary Bowman
5050 Broadway, 1st Floor
Oakland, CA 94611
Phone: 510.658.1209
Fax: 510.658.1407
Lloyds TSB Bank plc $ 8,750,000 3.50%
Attn: Windsor Davies
1251 Avenue of the Americas, 39th Floor
New York, NY 10020
Phone: 212.930.8909
Fax: 212.930.5098
PNC Bank, National Association $ 8,750,000 3.50%
Attn: Douglas Paul
2 Tower Center, 18th Floor
East Brunswick, NJ 08816
Phone: 732.220.3566
Fax: 732.220.3744
CENTEX EXHIBITS AND SCHEDULES
20
[LETTER OF CREDIT]
PRO RATA
NAME AND ADDRESS OF LENDERS COMMITMENT PART
Banca di Roma - Chicago Branch $ 5,000,000 2.00%
Attn: Joyce Montgomery
225 West Washington, Suite 1200
Chicago, IL 60606
Phone: 312.704.2648
Fax: 312.726.3058
UBS AG, Cayman Islands Branch $ 5,000,000 2.00%
Attn: [Denise Conzo]
677 Washington Boulevard
6-South
Stamford, CT 06901
Phone: 203.719.3853
Fax: 203.719.3888
The Northern Trust Company $ 2,500,000 1.00%
Attn: Paul Theiss
50 South LaSalle Street
Chicago, IL 60675
Phone: 312.557.1791
Fax: 312.444.7028
US Bank National Association $ 2,500,000 1.00%
Attn: Joseph Sooter
One US Bank Plaza
5L-MO-T12M
St. Louis, MO 63101
Phone: 314.418.2462
Fax: 314.418.3859
Totals $250,000,000 100.00%
CENTEX EXHIBITS AND SCHEDULES
21
SCHEDULE 7.3
SUBSIDIARIES
STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
CDMC HOLDING, INC. (Nevada) 100%
GREAT LAKES DEVELOPMENT CO., INC. (Nevada) 100.00%
CROSLAND ACCEPTANCE ASSOCIATES V (North Carolina) 100%
CROSLAND BOND COMPANY (North Carolina) 100%
GENBOND TWO, INC. (North Carolina) 100%
JOHN CROSLAND COMPANY (North Carolina) 100%
MORTGAGE ACCEPTANCE ASSOCIATES NO. 2 (North Carolina) 100%
MORTGAGE COLLATERAL ASSOCIATES NO. 1 (North Carolina) 100%
MORTGAGE COLLATERAL ASSOCIATES NO. 3 (North Carolina) 100%
CENTEX CONSTRUCTION PRODUCTS, INC. (Delaware) 65.10%
AMERICAN GYPSUM COMPANY (Delaware) 65.10%
AMERICAN GYPSUM MARKETING COMPANY (Delaware) 65.10%
CCP CEMENT COMPANY (Nevada) 65.10%
CCP CONCRETE/AGGREGATES LLC (Delaware) 65.10%
CCP GYPSUM COMPANY (Nevada) 65.10%
CCP LAND COMPANY (Nevada) 65.10%
CENTEX CEMENT CORPORATION (Nevada) 65.10%
CENTEX MATERIALS LLC (Delaware) 65.10%
CXP FUNDING, LLC (Delaware) 65.10%
HOLLIS & EASTERN RAILROAD COMPANY LLC (Delaware) 65.10%
M & W DRYWALL SUPPLY COMPANY (Nevada) 65.10%
MATHEWS READYMIX LLC (California) 65.10%
MOUNTAIN CEMENT COMPANY (Nevada) 65.10%
NEVADA CEMENT COMPANY (Nevada) 65.10%
REPUBLIC PAPERBOARD COMPANY LLC (Delaware) 65.10%
TEXAS CEMENT COMPANY (Nevada) 65.10%
TLCC GP LLC (Delaware) 65.10%
TLCC LP LLC (Delaware) 65.10%
WESTERN AGGREGATES LLC (Nevada) 65.10%
WESTERN CEMENT COMPANY OF CALIFORNIA (California) 65.10%
A. W. MORTGAGE, L.P. (Texas) 50.01%
ADFINET, INC. (Nevada) 100%
ADFITECH, INC. (Nevada) 100%
AMERICAN LANDMARK MORTGAGE, LTD. (Florida) 50.01%
ASHLEY TURNER FINANCE, L.P. (Texas) 50.01%
AT-HOME MORTGAGE ASSOCIATES, LTD. (Florida) 50.01%
AUSTIN PARTNERS IN LENDING, L.P. (Texas) 50.01%
BANYAN FINANCIAL OF CENTRAL FLORIDA, L.P. (Texas) 50.01%
Page 22
STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
BENEFIT ASSET MANAGEMENT CORPORATION (California) 100%
BUILDER'S HOME MORTGAGE, L.P. (Washington) 50.01%
CALIFORNIA HOME MORTGAGE, L.P. (Texas) 50.01%
CENTEX EQUITY CORPORATION (Nevada) 100%
CENTEX FINANCIAL SERVICES, INC. (Nevada) 100%
CENTEX HOME EQUITY COMPANY, LLC (Delaware) 100%
CENTEX OFFICE VICEROY I, L.P. (Delaware) 100%
CENTEX TECHNOLOGY, INC. (Nevada) 100%
CENTEX TITLE & ANCILLARY SERVICES, INC. (Nevada) 100%
CENTEX VICEROY GENERAL PARTNER, LLC (Delaware) 100%
CHEC ASSET RECEIVABLE CORPORATION (Nevada) 100%
CHEC CONDUIT FUNDING, LLC (Delaware) 100%
CHEC FUNDING, LLC (Delaware) 100%
CHEC INDUSTRIAL LOAN COMPANY (Tennessee) 100%
CHEC INDUSTRIAL LOAN CORPORATION (Minnesota) 100%
CHEC RESIDUAL, LLC (Delaware) 100%
COMMERCE APPRAISAL SERVICES, LLC (Delaware) 100%
COMMERCE LAND TITLE AGENCY, LLC (Ohio) 100%
COMMERCE LAND TITLE, INC. (Nevada) 100%
COMMERCE TITLE COMPANY (California) 100%
COMMERCE TITLE COMPANY, INC. (Alabama) 100%
COMMERCE TITLE COMPANY OF NEW MEXICO, LLC (Delaware) 100%
COMMERCE TITLE INSURANCE COMPANY (California) 100%
COMMERCE TITLE VENTURES, LLC (Delaware) 100%
CORE MORTGAGE CONNECTION, L.P. (Texas) 50.01%
CTX MORTGAGE COMPANY, LLC (Delaware) 100%
CTX MORTGAGE FUNDING III, LLC (Delaware) 100%
CTX MORTGAGE FUNDING, LLC (Delaware) 100%
CTX MORTGAGE VENTURES CORPORATION (Nevada) 100%
CTX MORTGAGE VENTURES, LLC (Delaware) 100%
CTX SWAP I, LLC (Delaware) 100%
DALLAS SUBURBS MORTGAGE, L.P. (Texas) 50%
DARDEN FINANCIAL SERVICES, L.P. (Texas) 50.01%
DENALI FINANCIAL SERVICES, L.P. (Texas) 50.01%
DUNDEE INSURANCE AGENCY, INC. (Texas) 100%
EXPRESS FINANCIAL SERVICES, LIMITED PARTNERSHIP (North Carolina) 50.01%
FAIRWAY FINANCIAL GROUP, L.P. (Texas) 50.01%
FIRST CENTURY MORTGAGE, L.P. (Texas) 50.01%
FLORIDA LANDMARK MORTGAGE, L.P. (Texas) 50.01%
FOUR OAKS MORTGAGE, L.P. (North Carolina) 50.01%
GLG MORTGAGE, L.P. (Texas) 50.01%
HARWOOD INSURANCE SERVICES, LLC (California) 100%
Page 23
STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
HARWOOD SERVICE COMPANY OF GEORGIA, LLC (Georgia) 100%
HARWOOD SERVICE COMPANY OF NEW JERSEY, LLC (New Jersey) 100%
HARWOOD SERVICE COMPANY, LLC (Delaware) 100%
HARWOOD STREET FUNDING I, LLC (Delaware) *
HARWOOD STREET FUNDING II, LLC (Delaware) 100%
HEARTLAND MORTGAGE, L.P. (California) 50.01%
HOMEFRONTMORTGAGE, L.P. (Washington 50.01%
LEWIS MORTGAGE COMPANY, L.P. (Texas) 50.01%
LMX FINANCIAL SERVICES, LTD. (Florida) 50.01%
METROPOLITAN TAX SERVICE, INC. (Nevada) 100%
METROPOLITAN TITLE & GUARANTY COMPANY (Florida) 100%
MH ACQUISITION COMPANY, LLC (Delaware) 100%
MORTGAGE PORTFOLIO SERVICES, INC. (Delaware) 100%
MPS FUNDING CORPORATION (Delaware) 100%
NAB ASSET COMPANY, LLC (Texas) 100%
NEW HOME MORTGAGE SPECIALISTS, L.P. (Washington) 50.01%
OPTIMA INFORMATION SOLUTIONS, LLC (Delaware) 71%
PACIFIC AMERICAN MORTGAGE COMPANY (Texas) 100%
PENNSTAR FINANCIAL, LLC (Delaware) 50.01%
PINE RIDGE FINANCIAL, L.P. (Washington) 50.01%
ROBERG FINANCIAL, L.P. (Texas) 50.01%
T.W. LEWIS MORTGAGE COMPANY, L.P. (Texas) 50.01%
VENTURE TITLE AGENCY, LTD., LLLP (Florida) 50.02%
WESTWOOD INSURANCE AGENCY (Nevada) 100%
WESTWOOD INSURANCE AGENCY OF ARIZONA, INC. (Arizona) 100%
WESTWOOD INSURANCE AGENCY (California) 100%
ARMOR INSURANCE COMPANY (Vermont) 100%
CENTEX INTERNATIONAL, INC. (Nevada) 100%
CENTEX INTERNATIONAL, LLC (Delaware) 98.95%
CENTEX LIFE SOLUTIONS, INC. (Nevada) 100%
CENTEX MANAGEMENT SERVICES LIMITED (United Kingdom) 98.95%
CENTEX SERVICE COMPANY (Nevada) 100%
CTX HOLDING COMPANY (Nevada) 100%
21 HOUSING COMPANY, LLC (Delaware) 100%
AAA HOLDINGS, INC. (Delaware) 100%
ABC HOMES LIMITED (United Kingdom) 50%
BARRINGTON CARPET, LLC (Delaware) 100%
CENTEX BUILDING SERVICES, INC. (Nevada) 100%
CENTEX DEVELOPMENT MANAGEMENT COMPANY (Nevada) 100%
CENTEX HOMES (Nevada) 99.95%
CENTEX HOMES INTERNATIONAL LIMITED (United Kingdom) 100%
CENTEX HOMES MARKETING, INC. (Georgia) 100%
Page 24
STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
CENTEX HOMES OF CALIFORNIA II, LLC (Delaware) 99.73%
CENTEX HOMES OF CALIFORNIA, LLC (Delaware) 99.73%
CENTEX HOMES REALTY COMPANY (Nevada) 100%
CENTEX HOMES REALTY, INC. (Michigan) 100%
CENTEX HOMES, INC. (Texas) 100%
CENTEX HOMES, LLC (Delaware) 99.95%
CENTEX LATIN AMERICA, INC. (Nevada) 100%
CENTEX LOST CREEK RANCH, LLC (Delaware) 99.95%
CENTEX MANUFACTURED HOUSING GROUP, LLC (Delaware) 100%
CENTEX REAL ESTATE CONSTRUCTION COMPANY (Nevada) 100%
CENTEX REAL ESTATE CORPORATION (Nevada) 100%
CENTEX REALTY, INC. (Florida) 100%
CITY HOMEBUILDERS, INC. (Texas) 100%
COYOTE CANYON, LLC (Delaware) 99.95%
CTX BUILDERS SUPPLY SERVICES, LLC (Delaware) 99.95%
DESARROLLOS EN LATINOAMERICA SERVICIOS ADMINSTRATIVOS S
DE RL DE CV (Mexico) 100%
EMPRESAS INMOBILIARIAS DE MEXICO, S. DE R.L. DE C.V. (Mexico) 100%
FOX & JACOBS, INC. (Texas) 100%
MEADOW VISTA COMPANY, LLC (Delaware) 100%
MELROSE PARK JOINT VENTURE (Florida) 53.31%
SELECTIVE - DELAWARE, L.L.C. (Delaware) 99.95%
ST LENDING, INC. (Delaware) 99.73%
SUNSET RANCHOS DEVELOPERS, LLC (Delaware) 99.95%
SYCAMORE CREEK (California) 50.00%
THE JONES COMPANY BUILDING SERVICES, LLC (Nevada) 99.95%
THE JONES COMPANY HOMES, LLC (Nevada) 99.95%
THE JONES COMPANY HOMES REALTY, LLC (Nevada) 99.95%
WAYNE HOMES, LLC (Delaware) 97.44%
WAYNE HOMES MID ATLANTIC, LLC (Delaware) 99.95%
CENTEX HOME SERVICES COMPANY (Nevada) 100%
CENTEX HOMETEAM LAWN CARE, LLC (Delaware) 100%
CENTEX HOMETEAM SECURITY, INC. (Nevada) 100%
HOMETEAM PEST DEFENSE, INC. (Nevada) 100%
HOMETEAM PEST DEFENSE, LLC (Delaware) 100%
BATESON DAILEY, A JOINT VENTURE (Michigan) 65%
CENTEX ATLANTIC, LCL (Delaware) 100%
CENTEX CONCORD (Tennessee) 50%
CENTEX CONCORD PROPERTY MANAGEMENT, L.L.C. (Tennessee) 50%
CENTEX CONSTRUCTION COMPANY, INC. (Nevada) 100%
CENTEX CONSTRUCTION GROUP, INC. (Nevada) 100%
CENTEX CONSTRUCTION GROUP SERVICES, LLC (Delaware) 100%
Page 25
STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
CENTEX ENGINEERING & CONSTRUCTION, INC. (Nevada) 100%
CENTEX GOLDEN CONSTRUCTION COMPANY (Nevada) 100%
CENTEX LANDIS LIMITED LIABILITY COMPANY NO.1 (Louisiana) 100%
CENTEX RODGERS, INC. (Nevada) 100%
CENTEX ROONEY CONSTRUCTION CO., INC./HUBER, HUNT &
NICHOLS, INC., A JOINT VENTURE (Florida) 65%
CENTEX ROONEY CONSTRUCTION CO., INC./LANDIS COMPANY, INC. A
JOINT VENTURE Louisiana) 70%
CENTEX ROONEY CONSTRUCTION CO., INC./RATTLER
CONSTRUCTION CONTRACTORS, INC., A JOINT VENTURE (Florida) 75%
CENTEX ROONEY CONSTRUCTION COMPANY/ACI, A JOINT VENTURE (Florida) 50%
CENTEX ROONEY MARINE, INC. (Florida) 100%
CENTEX ROONEY/GRAY CONSTRUCTION, A JOINT VENTURE (Florida) 85%
CENTEX ROONEY/HLM CORRECTIONAL DESIGN BUILDERS, LC (Florida) 70%
CENTEX ROONEY/KBJ DESIGN/BUILD, L.L.C. (Delaware) 90%
CENTEX ROONEY/LLT, A JOINT VENTURE (Florida) 75%
CENTEX ROONEY/PGAL DESIGN BUILDERS, L.C. (Florida) 90%
CENTEX ROONEY/RS&H DESIGN BUILDERS, L.C. (Florida) 90%
CENTEX ROONEY/SCHENKEL SHULTZ DESIGN/BUILDERS, L.C. (Florida) 50%
CENTEX SEISMIC SERVICES, INC. (Nevada) 95%
CENTEX/F&S, L.L.C. (Delaware) 100%
CENTEX/FPC, L.L.C. (Delaware) 100%
CENTEX/HKS II, L.L.C. (Delaware) 100%
CENTEX/HKS, CANYON, L.L.C. (Delaware) 100%
CENTEX/HKS, L.L.C. (Delaware) 100%
CENTEX/MASHBURN, A JOINT VENTURE (North Carolina) 65%
CENTEX/MORRIS II, L.L.C. (Delaware) 100%
CENTEX/MORRIS, L.L.C. (Delaware) 100%
CENTEX/OMNIPLAN, L.L.C. (Delaware) 100%
CENTEX/OMNIPLAN II, L.L.C. (Delaware) 100%
CENTEX/SCHENKEL SHULTZ, L.L.C. (Delaware) 100%
CENTEX/SHG, L.L.C. (Delaware) 100%
CENTEX/SICNER, LLC (Delaware) 90%
CENTEX/WORTHGROUP, L.L.C. (Delaware) 100%
CENTEX-3D/I, A JOINT VENTURE (Texas) 90%
CENTEX-AIM CONSTRUCTION, L.L.C. (Michigan) 80%
CENTEX-GILFORD, A JOINT VENTURE (Virginia) 79.58%
CENTEX-GILFORD, A JOINT VENTURE II (Virginia) 88%
CENTEX-ROONEY CONSTRUCTION CO., INC. (Florida) 100%
CENTEX-ROONEY CONSTRUCTION CO. OF GEORGIA, LLC (Delaware) 100%
CENTEX-ROONEY CONSTRUCTION CO., INC./CONSTRUCT TWO
CONSTRUCTION MANAGERS, INC., A JOINT VENTURE (Florida) 90%
Page 26
STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
CKC FACILITIES GROUP, L.C. (Florida) 60%
GHQ COMPANY, INC. (Nevada) 100%
INDEPENDENT GENERAL AGENCY, INC. (Texas) 100%
KIRCHMAN/CENTEX, A JOINT VENTURE (Florida) 75%
THE STUDENT COMMUNITIES GROUP, L.C. (Florida) 50%
Page 27
UNRESTRICTED STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
CDMC HOLDING, INC. (Nevada) 100%
GREAT LAKES DEVELOPMENT CO., INC. (Nevada) 100.00%
CROSLAND ACCEPTANCE ASSOCIATES V (North Carolina) 100%
CROSLAND BOND COMPANY (North Carolina) 100%
GENBOND TWO, INC. (North Carolina) 100%
JOHN CROSLAND COMPANY (North Carolina) 100%
MORTGAGE ACCEPTANCE ASSOCIATES NO. 2 (North Carolina) 100%
MORTGAGE COLLATERAL ASSOCIATES NO. 1 (North Carolina) 100%
MORTGAGE COLLATERAL ASSOCIATES NO. 3 (North Carolina) 100%
CENTEX CONSTRUCTION PRODUCTS, INC. (Delaware) 65.10%
AMERICAN GYPSUM COMPANY (Delaware) 65.10%
AMERICAN GYPSUM MARKETING COMPANY (Delaware) 65.10%
CCP CEMENT COMPANY (Nevada) 65.10%
CCP CONCRETE/AGGREGATES LLC (Delaware) 65.10%
CCP GYPSUM COMPANY (Nevada) 65.10%
CCP LAND COMPANY (Nevada) 65.10%
CENTEX CEMENT CORPORATION (Nevada) 65.10%
CENTEX MATERIALS LLC (Delaware) 65.10%
CXP FUNDING, LLC (Delaware) 65.10%
HOLLIS & EASTERN RAILROAD COMPANY LLC (Delaware) 65.10%
M & W DRYWALL SUPPLY COMPANY (Nevada) 65.10%
MATHEWS READYMIX LLC (California) 65.10%
MOUNTAIN CEMENT COMPANY (Nevada) 65.10%
NEVADA CEMENT COMPANY (Nevada) 65.10%
REPUBLIC PAPERBOARD COMPANY LLC (Delaware) 65.10%
TEXAS CEMENT COMPANY (Nevada) 65.10%
TLCC GP LLC (Delaware) 65.10%
TLCC LP LLC (Delaware) 65.10%
WESTERN AGGREGATES LLC (Nevada) 65.10%
WESTERN CEMENT COMPANY OF CALIFORNIA (California) 65.10%
A. W. MORTGAGE, L.P. (Texas) 50.01%
ADFINET, INC. (Nevada) 100%
ADFITECH, INC. (Nevada) 100%
AMERICAN LANDMARK MORTGAGE, LTD. (Florida) 50.01%
ASHLEY TURNER FINANCE, L.P. (Texas) 50.01%
AT-HOME MORTGAGE ASSOCIATES, LTD. (Florida) 50.01%
AUSTIN PARTNERS IN LENDING, L.P. (Texas) 50.01%
BANYAN FINANCIAL OF CENTRAL FLORIDA, L.P. (Texas) 50.01%
BENEFIT ASSET MANAGEMENT CORPORATION (California) 100%
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UNRESTRICTED STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
BUILDER'S HOME MORTGAGE, L.P. (Washington) 50.01%
CALIFORNIA HOME MORTGAGE, L.P. (Texas) 50.01%
CENTEX EQUITY CORPORATION (Nevada) 100%
CENTEX FINANCIAL SERVICES, INC. (Nevada) 100%
CENTEX HOME EQUITY COMPANY, LLC (Delaware) 100%
CENTEX OFFICE VICEROY I, L.P. (Delaware) 100%
CENTEX TECHNOLOGY, INC. (Nevada) 100%
CENTEX TITLE & ANCILLARY SERVICES, INC. (Nevada) 100%
CENTEX VICEROY GENERAL PARTNER, LLC (Delaware) 100%
CHEC ASSET RECEIVABLE CORPORATION (Nevada) 100%
CHEC CONDUIT FUNDING, LLC (Delaware) 100%
CHEC FUNDING, LLC (Delaware) 100%
CHEC INDUSTRIAL LOAN COMPANY (Tennessee) 100%
CHEC INDUSTRIAL LOAN CORPORATION (Minnesota) 100%
CHEC RESIDUAL, LLC (Delaware) 100%
COMMERCE APPRAISAL SERVICES, LLC (Delaware) 100%
COMMERCE LAND TITLE AGENCY, LLC (Ohio) 100%
COMMERCE LAND TITLE, INC. (Nevada) 100%
COMMERCE TITLE COMPANY (California) 100%
COMMERCE TITLE COMPANY, INC. (Alabama) 100%
COMMERCE TITLE COMPANY OF NEW MEXICO, LLC (Delaware) 100%
COMMERCE TITLE INSURANCE COMPANY (California) 100%
COMMERCE TITLE VENTURES, LLC (Delaware) 100%
CORE MORTGAGE CONNECTION, L.P. (Texas) 50.01%
CTX MORTGAGE COMPANY, LLC (Delaware) 100%
CTX MORTGAGE FUNDING III, LLC (Delaware) 100%
CTX MORTGAGE FUNDING, LLC (Delaware) 100%
CTX MORTGAGE VENTURES CORPORATION (Nevada) 100%
CTX MORTGAGE VENTURES, LLC (Delaware) 100%
CTX SWAP I, LLC (Delaware) 100%
DALLAS SUBURBS MORTGAGE, L.P. (Texas) 50%
DARDEN FINANCIAL SERVICES, L.P. (Texas) 50.01%
DENALI FINANCIAL SERVICES, L.P. (Texas) 50.01%
DUNDEE INSURANCE AGENCY, INC. (Texas) 100%
EXPRESS FINANCIAL SERVICES, LIMITED PARTNERSHIP (North Carolina) 50.01%
FAIRWAY FINANCIAL GROUP, L.P. (Texas) 50.01%
FIRST CENTURY MORTGAGE, L.P. (Texas) 50.01%
FLORIDA LANDMARK MORTGAGE, L.P. (Texas) 50.01%
FOUR OAKS MORTGAGE, L.P. (North Carolina) 50.01%
GLG MORTGAGE, L.P. (Texas) 50.01%
HARWOOD INSURANCE SERVICES, LLC (California) 100%
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UNRESTRICTED STATE OF OWNERSHIP
SUBSIDIARY FORMATION PERCENTAGE
HARWOOD SERVICE COMPANY OF GEORGIA, LLC (Georgia) 100%
HARWOOD SERVICE COMPANY OF NEW JERSEY, LLC (New Jersey) 100%
HARWOOD SERVICE COMPANY, LLC (Delaware) 100%
HARWOOD STREET FUNDING I, LLC (Delaware) *
HARWOOD STREET FUNDING II, LLC (Delaware) 100%
HEARTLAND MORTGAGE, L.P. (California) 50.01%
HOMEFRONTMORTGAGE, L.P. (Washington 50.01%
LEWIS MORTGAGE COMPANY, L.P. (Texas) 50.01%
LMX FINANCIAL SERVICES, LTD. (Florida) 50.01%
METROPOLITAN TAX SERVICE, INC. (Nevada) 100%
METROPOLITAN TITLE & GUARANTY COMPANY (Florida) 100%
MH ACQUISITION COMPANY, LLC (Delaware) 100%
MORTGAGE PORTFOLIO SERVICES, INC. (Delaware) 100%
MPS FUNDING CORPORATION (Delaware) 100%
NAB ASSET COMPANY, LLC (Texas) 100%
NEW HOME MORTGAGE SPECIALISTS, L.P. (Washington) 50.01%
OPTIMA INFORMATION SOLUTIONS, LLC (Delaware) 71%
PACIFIC AMERICAN MORTGAGE COMPANY (Texas) 100%
PENNSTAR FINANCIAL, LLC (Delaware) 50.01%
PINE RIDGE FINANCIAL, L.P. (Washington) 50.01%
ROBERG FINANCIAL, L.P. (Texas) 50.01%
T.W. LEWIS MORTGAGE COMPANY, L.P. (Texas) 50.01%
VENTURE TITLE AGENCY, LTD., L.P. (Florida) 50.02%
WESTWOOD INSURANCE AGENCY (Nevada) 100%
WESTWOOD INSURANCE AGENCY OF ARIZONA, INC. (Arizona) 100%
WESTWOOD INSURANCE AGENCY (California) 100%
* Owned 100% by holders of various series of Subordinated
Certificates issued by Harwood Street Funding I, LLC. These
holders are not affiliated with Centex Corporation.
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