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$75,000,000
CREDIT AGREEMENT
AMONG
LA QUINTA INNS, INC.
CERTAIN LENDERS
AND
NATIONSBANK OF TEXAS, N.A., AS ADMINISTRATIVE LENDER
November 17, 1997
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TABLE OF CONTENTS
Page
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ARTICLE 1
Definitions
Section 1.1 Defined Terms .............................................. 1
Section 1.2 Amendments and Renewals .................................... 9
Section 1.3 Construction ............................................... 9
ARTICLE 2
Advances
Section 2.1 Revolving Credit Advances .................................. 9
Section 2.2 Manner of Borrowing and Disbursement ....................... 9
Section 2.3 Interest ................................................... 11
(a) On Base Rate Advances ...................................... 11
(b) On LIBOR Advances .......................................... 12
(c) Interest if No Notice of Selection of Interest Rate Basis .. 12
(d) Interest After an Event of Default ......................... 12
Section 2.4 Fees ....................................................... 12
Section 2.5 Prepayment ................................................. 13
(a) Voluntary Prepayments ...................................... 13
(b) Mandatory Prepayment ....................................... 13
(c) Prepayments, Generally ..................................... 13
Section 2.6 Reduction of Commitment .................................... 13
(a) Voluntary Reduction ........................................ 13
(b) Mandatory Reduction ........................................ 13
(c) General Requirements ....................................... 13
Section 2.7 Non-Receipt of Funds by the Administrative Lender .......... 14
Section 2.8 Payment of Principal of Advances ........................... 14
(a) End of Interest Period ..................................... 14
(b) Commitment Reduction ....................................... 14
(c) Maturity Date .............................................. 14
Section 2.9 Reimbursement .............................................. 14
Section 2.10 Manner of Payment .......................................... 15
Section 2.11 LIBOR Lending Offices ...................................... 15
Section 2.12 Sharing of Payments ........................................ 16
Section 2.13 Calculation of Rates ....................................... 16
Section 2.14 Booking Loans .............................................. 16
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Section 2.15 Taxes ....................................................... 17
ARTICLE 3
Conditions Precedent
Section 3.1 Conditions Precedent to the Initial Advances ................ 20
Section 3.2 Conditions Precedent to All Advances ........................ 21
ARTICLE 4
Representations and Warranties
Section 4.1 Representations and Warranties .............................. 22
(a) Existing Credit Agreement Representations and Warranties .... 22
(b) Authorization ............................................... 22
(c) Compliance with Other Loan Papers and
Contemplated Transactions ................................ 22
(d) Compliance with Regulations G, T, U and X ................... 23
(e) Disclosure .................................................. 23
Section 4.2 Survival of Representations and Warranties, etc ............. 23
ARTICLE 5
Covenants
Section 5.1 Existing Credit Agreement ................................... 24
Section 5.2 Use of Proceeds ............................................. 24
Section 5.3 Indemnity ................................................... 25
ARTICLE 6
Default
Section 6.1 Events of Default ........................................... 26
Section 6.2 Remedies .................................................... 27
ARTICLE 7
Changes in Circumstances
Section 7.1 LIBOR Basis Determination Inadequate ........................ 28
Section 7.2 Illegality .................................................. 28
Section 7.3 Increased Costs ............................................. 28
Section 7.4 Effect On Base Rate Advances ................................ 30
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Section 7.5 Capital Adequacy ............................................. 30
ARTICLE 8
AGREEMENT AMONG LENDERS
Section 8.1 Agreement Among Lenders ...................................... 31
(a) Administrative Lender ........................................ 31
(b) Replacement of Administrative Lender ......................... 31
(c) Expenses ..................................................... 31
(d) Delegation of Duties ......................................... 32
(e) Reliance by Administrative Lender ............................ 32
(f) Limitation of Administrative Lender's Liability .............. 32
(g) Liability Among Lenders ...................................... 33
(h) Rights as Lender ............................................. 33
Section 8.2 Lender Credit Decision ....................................... 33
Section 8.3 Benefits of Article .......................................... 33
ARTICLE 9
Miscellaneous
Section 9.1 Notices ...................................................... 34
Section 9.2 Expenses ..................................................... 34
Section 9.3 Waivers ...................................................... 35
Section 9.4 Determination by the Lenders Conclusive and Binding .......... 36
Section 9.5 Set-Off ...................................................... 36
Section 9.6 Assignment ................................................... 36
Section 9.7 Counterparts ................................................. 38
Section 9.8 Severability ................................................. 38
Section 9.9 Interest and Charges ......................................... 38
Section 9.10 Confidentiality .............................................. 39
Section 9.11 Headings ..................................................... 39
Section 9.12 Amendment and Waiver ......................................... 39
Section 9.13 Exception to Covenants ....................................... 40
SECTION 9.14 GOVERNING LAW ................................................ 40
SECTION 9.15 WAIVER OF JURY TRIAL ......................................... 40
SECTION 9.16 ENTIRE AGREEMENT ............................................. 41
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Schedules
Schedule 1 LIBOR Lending Offices
Exhibits
Exhibit A: Revolving Credit Note
Exhibit B: Subsidiary Guaranty
Exhibit C: Assignment Agreement
Exhibit D: Confidentiality Agreement
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT is dated as of November 17, 1997, among LA QUINTA
INNS, INC., a Texas corporation ("Borrower"), the Lenders from time to time
party hereto, and NATIONSBANK OF TEXAS, N.A., a national banking association, as
administrative agent for the Lenders.
BACKGROUND
The Borrower has requested that the Lenders make a credit facility
available to the Borrower in the maximum principal amount of $75,000,000
pursuant to this Agreement. The Lenders have agreed to provide such credit
facility, subject to the terms and conditions set forth below.
In consideration of the mutual covenants and agreements contained herein,
and other good and valuable consideration hereby acknowledged, the parties
hereto agree that the Existing Credit Agreements are amended and restated in
their entirety as follows:
ARTICLE 1
Definitions
Section 1.1 Defined Terms. For purposes of this Agreement:
"Additional Costs" has the meaning set forth in Section 8.5 hereof.
"Adjusted LIBOR Rate" means, for any LIBOR Advance for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100th of 1%) determined by the Administrative Lender to be equal to the
quotient obtained by dividing (a) the LIBOR Rate for such LIBOR Advance for such
Interest Period by (b) 1 minus the Reserve Requirement for such LIBOR Advance
for such Interest Period.
"Administrative Lender" means NationsBank of Texas, N.A., a national
banking association, as administrative agent for Lenders, or such successor
administrative agent appointed pursuant to Section 9.1(b) hereof.
"Advance" means a Revolving Credit Advance and "Advances" means Revolving
Credit Advances.
"Agreement" means this Credit Agreement, as amended, modified, supplemented
and restated from time to time.
"Agreement Date" means the date of this Agreement.
"Applicable Law" means (a) in respect of any Person, all provisions of
constitutions, statutes, rules, regulations and orders of governmental bodies or
regulatory agencies applicable to such Person and its properties, including,
without limiting the foregoing, all orders and decrees of all courts and
arbitrators in proceedings or actions to which the Person in question is a
party, and (b) in respect of contracts relating to interest or finance charges
that are made or performed in the State of Texas, "Applicable Law" shall mean
the laws of the United States of America, including without limitation 12 USC
ss.ss. 85 and 86, as amended from time to time, and any other statute of the
United States of America now or at any time hereafter prescribing the maximum
rates of interest on loans and extensions of credit, and the laws of the State
of Texas, including, without limitation, Article 5069-1.04, Title 79, Revised
Civil Statutes of Texas, 1925, as amended ("Art. 1.04"), and any other statute
of the State of Texas now or at any time hereafter prescribing maximum rates of
interest on loans and extensions of credit; provided that the parties hereto
agree that the provisions of Chapter 15, Title 79, Revised Civil Statutes of
Texas, 1925, as amended, shall not apply to Advances, this Agreement, the Notes
or any other Loan Papers.
"Art. 1.04" has the meaning specified in the definition of "Applicable
Law."
"Assignees" means any assignee of a Lender pursuant to an Assignment
Agreement and has the meaning specified in Section 10.6 hereof.
"Assignment Agreement" has the meaning specified in Section 9.6 hereof.
"Authorized Officer" means any of the following officers of the Borrower:
President, Senior Vice President-Chief Financial Officer, or Vice President &
General Counsel.
"Authorized Signatory" means such senior personnel of the Borrower as may
be duly authorized and designated in writing by the Borrower to execute
documents, agreements and instruments on behalf of the Borrower, and to request
Advances hereunder.
"Base Rate Advance" means a Revolving Credit Advance which the Borrower
requests to be made as a Base Rate Advance or which is reborrowed as a Base Rate
Advance, in accordance with the provisions of Section 2.2 hereof.
"Base Rate Basis" means, for any day, a per annum interest rate equal to
the higher of (a) the sum of (i) 0.50% plus (ii) the Federal Funds Rate on such
day or (b) the Prime Rate on such day. The Base Rate Basis shall be adjusted
automatically as of the opening of business on the effective date of each change
in the Prime Rate or Federal Funds Rate, as the case may be, to account for such
change.
"Borrower" has the meaning specified in the initial paragraph of this
Agreement.
"Business Day" means a day on which commercial banks are open (a) for the
transaction of
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business in Dallas, Texas and New York, New York, and, (b) with respect to any
LIBOR Advance, for the transaction of international business (including dealings
in Dollar deposits) in London, England.
"Capital Stock" means, with respect to any Person, any capital stock,
partnership or joint venture interests of such Person and shares, interests,
participations or other ownership interests (however designated) of any Person
and any rights (other than debt securities convertible into corporate stock),
warrants or options to purchase any of the foregoing.
"Code" means the Internal Revenue Code of 1986, as amended, together with
all regulations thereunder.
"Commitment" means $75,000,000, as reduced pursuant to Section 2.6 hereof.
"Confidentiality Agreement" has the meaning specified in Section 9.10
hereof.
"Debtor Relief Laws" means any applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, insolvency, reorganization or similar
debtor relief Laws affecting the rights of creditors generally from time to time
in effect.
"Default" means an Event of Default and/or any of the events specified in
Section 7.1, regardless of whether there shall have occurred any passage of time
or giving of notice that would be necessary in order to constitute such event an
Event of Default.
"Default Rate" means a simple per annum interest rate equal to the lesser
of (a) the Highest Lawful Rate, or (b) the sum of the Prime Rate plus three
percent.
"Determining Lenders" means, on any date of determination, any combination
of the Lenders having at least 51% of the aggregate amount of the Revolving
Credit Advances then outstanding; provided, however, that if there are no
Revolving Credit Advances outstanding hereunder, "Determining Lenders" shall
mean any combination of Lenders whose Specified Percentages hereunder aggregate
at least 51%.
"Dollar" or "$" means lawful currency of the United States of America.
"Event of Default" means any of the events specified in Section 6.1,
provided that any requirement for notice or lapse of time has been satisfied.
"Existing Credit Agreement" means that certain First Amended and Restated
Credit Agreement, dated as of February 7, 1997, among the Borrower, the lenders
party thereto and NationsBank of Texas, N.A., as amended, modified, supplemented
or restated from time to time.
"Existing Credit Agreement Representations and Warranties" has the meaning
specified in Section 4.1(a) hereof.
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"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 members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of Dallas on the Business Day next
succeeding such day, provided that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate quoted to the
Administrative Lender on such day on such transactions as determined by
Administrative Lender.
"GAAP" means generally accepted accounting principles, set forth in the
Opinions of the Accounting Principles Board of the American Institute of
Certified Public Accountants, or their successors which are applicable in the
circumstances as of the date in question (except as stated in the last sentence
of this definition). The requisite that such principles be applied on a
consistent basis shall mean that the accounting principles observed in a current
period are comparable in all material respects to those applied in a preceding
period, except as otherwise required by the adoption of Statements by the
Financial Accounting Standards Board. Notwithstanding the foregoing, each
determination and computation with respect to financial covenants and ratios in
this Agreement shall be made in accordance with GAAP as in effect on the
Agreement Date.
"Guaranty Agreements" means the Subsidiary Guaranty and any other Guaranty
executed by a Guarantor.
"Guarantor" means each Significant Subsidiary.
"Highest Lawful Rate" means at the particular time in question the maximum
rate of interest which, under Applicable Law, the Lenders are then permitted to
charge on the Obligations. If the maximum rate of interest which, under
Applicable Law, the Lenders are permitted to charge on the Obligations shall
change after the date hereof, the Highest Lawful Rate shall be automatically
increased or decreased, as the case may be, from time to time as of the
effective time of each change in the Highest Lawful Rate without notice to the
Borrower. For purposes of determining the Highest Lawful Rate under the
Applicable Law of the State of Texas, the applicable rate ceiling shall be (a)
the indicated rate ceiling described in and computed in accordance with the
provisions of Section (a)(1) of Art. 1.04, or (b) if the parties subsequently
contract as allowed by Applicable Law, the quarterly ceiling or the annualized
ceiling computed pursuant to Section (d) of Art. 1.04; provided, however, that
at any time the indicated rate ceiling, the quarterly ceiling or the annualized
ceiling shall be less than 18% per annum or more than 24% per annum, the
provisions of Sections (b)(1) and (2) of said Art. 1.04 shall control for
purposes of such determination, as applicable.
"Increased Advance Costs" has the meaning specified in Section 7.3 hereof.
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"Increased Advance Costs Retroactive Effective Date" has the meaning
specified in Section 7.3 hereof.
"Increased Advance Costs Set Date" has the meaning specified in Section 7.3
hereof.
"Indemnified Matters" has the meaning specified in Section 5.3 hereof.
"Indemnitees" has the meaning specified in Section 5.3 hereof.
"Interest Period" means, for any LIBOR Advance, the period beginning on the
day such Advance is made and ending one, two or three months thereafter (as the
Borrower shall select).
"Lender" means each financial institution shown on the signature pages
hereof so long as such financial institution maintains a portion of the
Commitment or is owed any part of the Obligations (including the Administrative
Lender in its individual capacity), and each Assignee that hereafter becomes
party hereto pursuant to Section 9.6 hereof.
"LIBOR Advance" means a Revolving Credit Advance which the Borrower
requests to be made as a LIBOR Advance or which is reborrowed as a LIBOR
Advance, in accordance with the provisions of Section 2.2 hereof.
"LIBOR Basis" means, with respect to each LIBOR Advance for each Interest
Period, a rate per annum equal to the lesser of (a) the Highest Lawful Rate or
(b) the sum of the Adjusted LIBOR Rate plus 0.3875.
"LIBOR Lending Office" means, with respect to a Lender, the office
designated as its LIBOR Lending Office on Schedule 1 attached hereto, and such
other office of the Lender or any of its affiliates hereafter designated by
notice to the Borrower and the Administrative Lender.
"LIBOR Rate" means, for any LIBOR Advance for any Interest Period therefor,
the rate per annum (rounded upwards, if necessary, to the nearest 1/100th of 1%)
appearing on Telerate Page 3750 (or any successor page) as the London interbank
offered rate for deposits in Dollars at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period. If for any reason such rate is not
available, the term "LIBOR Rate" shall mean, for any LIBOR Advance for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100th of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided, however, if more than
one rate is specified on Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates (rounded upwards, if necessary, to the
nearest 1/100th of 1%).
"Loan Papers" means this Agreement, the Notes, the Guaranty Agreements, and
any other document or agreement executed or delivered from time to time by the
Borrower, any Subsidiary
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or any other Person in connection herewith or as security for all or any part of
the Obligations.
"Loan Party" means the Borrower and each Guarantor.
"Material Adverse Change or Effect" means any act or circumstance or event
which (a) is material and adverse to the combined or consolidated financial
condition of the Borrower, its Subsidiaries and Unincorporated Ventures as
represented in the Combined Financial Statements (as defined in the Existing
Credit Agreement) most recently delivered to the Lenders at the time of any
determination thereof or is material and adverse to the combined or consolidated
business operations or properties of the Borrower, its Subsidiaries and
Unincorporated Ventures or (b) impairs the ability of the Borrower, any
Subsidiary or any other Person to perform in any material respect their
respective obligations under the Loan Papers.
"Maturity Date" means March 15, 1998, or the earlier date of termination in
whole of the Commitment pursuant to Section 2.6 or 6.2 hereof.
"Maximum Amount" means the maximum amount of interest which, under
Applicable Law, the Lenders are permitted to charge on the Obligations.
"Necessary Authorization" means any right, franchise, license, permit,
consent, approval or authorization from, or any filing or registration with, any
governmental or other regulatory authority necessary or appropriate to enable
the Borrower or any Subsidiary or Unincorporated Venture to maintain and operate
its business and properties.
"Note" means any Revolving Credit Note and "Notes" means the Revolving
Credit Notes.
"Obligations" means (a) all obligations of any nature (whether matured or
unmatured, fixed or contingent) of the Borrower, any Subsidiary or any other
Person to any of the Lenders under the Loan Papers as they may be amended from
time to time, and (b) all obligations of the Borrower, any Subsidiary or any
other Person for losses, damages, expenses or any other liabilities of any kind
that any Lender may suffer by reason of a breach by the Borrower, any Subsidiary
or any other Person of any obligation, covenant or undertaking with respect to
any Loan Paper.
"Obligor" means Borrower or each other Person liable for performance of any
of the Obligations or the property of which secures any of the Obligations.
"Other Taxes" has the meaning specified in Section 2.15 hereof.
"Participant" has the meaning specified in Section 9.6(c) hereof.
"Participation" has the meaning specified in Section 9.6(c) hereof.
"Payment Date" means the last day of the Interest Period for any LIBOR
Advance.
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"Person" means and includes an individual, corporation, partnership, trust
or unincorporated organization, or a government or any agency or political
subdivision thereof.
"Prime Rate" means, at any time, the prime interest rate announced or
published by the Administrative Lender from time to time as its reference rate
for the determination of interest rates for loans of varying maturities in
Dollars to United States residents of varying degrees of creditworthiness and
being quoted at such time by the Administrative Lender as its "prime rate;" it
being understood that such rate may not be the lowest rate of interest charged
by the Administrative Lender.
"Quarterly Date" means the last Business Day of each February, May, August
and November, beginning November 28, 1997.
"Refinancing Advance" means any Revolving Credit Advance which is used to
pay the principal amount (or any portion thereof) of a Revolving Credit Advance
at the end of its Interest Period and which, after giving effect to such
application, does not result in an increase in the aggregate amount of
outstanding Revolving Credit Advances.
"Regulatory Modification Retroactive Effective Date" has the meaning
specified in Section 7.5 hereof.
"Regulatory Modification Set Date" has the meaning specified in Section 7.5
hereof.
"Release Date" means the date on which the Notes have been paid, all other
Obligations due and owing have been paid and performed in full, and the
Commitment has been terminated.
"Reserve Requirement" means, at any time, the maximum rate at which
reserves (including, without limitation, any marginal, special, supplemental or
emergency reserves) are required to be maintained under regulations 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 (i) any category
of liabilities which includes deposits by reference to which the Adjusted LIBOR
Rate is to be determined, or (ii) any category of extensions of credit or other
assets which include LIBOR Advances or LIBOR Bid Rate Advances. The Adjusted
LIBOR Rate shall be adjusted automatically on and as of the effective date of
any change in the Reserve Requirement.
"Revolving Credit Advance" means an Advance made pursuant to Section 2.1
hereof.
"Revolving Credit Note" means any Promissory Note of the Borrower
evidencing Revolving Credit Advances hereunder, substantially in the form of
Exhibit A hereto, together with any extension, renewal or amendment thereof or
substitution therefor.
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"Rights" means rights, remedies, powers and privileges.
"Significant Subsidiary" means any Subsidiary of the Borrower (a) the
revenues attributable to which for the then most recently completed four fiscal
quarters constituted (or, with respect to Subsidiaries acquired during such four
fiscal quarters, would have constituted had the revenues of such Subsidiary been
included for such period) 2.5% or more of the consolidated revenues of the
Borrower and its Subsidiaries for such period, or (b) the assets of which as of
the end of such period constituted 2.5% or more of the consolidated assets of
the Borrower and its Subsidiaries as of the end of such period.
"Solvent" means, with respect to any Person, that the fair value of the
assets of such Person (both at fair valuation and at present fair saleable
value) is, on the date of determination, greater than the total amount of
liabilities (including contingent and unliquidated liabilities) of such Person
as of such date and that, as of such date, such Person is able to pay all
liabilities of such Person as such liabilities mature and such Person does not
have unreasonably small capital with which to carry on its business. In
computing the amount of contingent or unliquidated liabilities at any time, such
liabilities will be computed at the amount which, in light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability discounted to present value
at rates believed to be reasonable by such Person.
"Special Counsel" means the law firm of Donohoe, Jameson & Carroll, P.C.,
or such other legal counsel as the Administrative Lender may select.
"Specified Percentage" means, as to any Lender, the percentage indicated
beside its name on the signature pages hereof, or if applicable, specified in
its most recent Assignment Agreement.
"Subsidiary" with respect to any Persons, means (a) a corporation at least
a majority of whose Capital Stock with voting power, under ordinary
circumstances, to elect directors is at the time, directly or indirectly, owned
by such Person, by such Person and one or more Subsidiaries of such Person or by
one or more Subsidiaries of such Person or (b) a partnership, joint venture or
similar entity in which 100% of the ownership, capital, interest or profits is
at the time, directly or indirectly, owned by such Person, by such Person and
one or more Subsidiaries of such Person or by one or more Subsidiaries of such
Person.
"Subsidiary Guaranty" means the Guaranty executed by each Significant
Subsidiary guaranteeing payment and performance of the Obligations,
substantially in the form of Exhibit B hereto, as such agreement may be amended,
modified, supplemented or restated from time to time.
"Taxes" has the meaning specified in Section 2.15 hereof.
"Tribunal" means any state, commonwealth, federal, foreign territorial, or
other court or governmental department, commission, board, bureau, agency or
instrumentality.
"UCC" means the Uniform Commercial Code of Texas, as amended from time to
time.
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"Unincorporated Ventures" has the meaning given to such term in the
Existing Credit Agreement.
Section 1.2 Amendments and Renewals. Each definition of an agreement in
this Article 1 shall include such agreement as amended to date, and as amended
or renewed from time to time in accordance with its terms, but only with the
prior written consent of the Determining Lenders or all Lenders as required
pursuant to Section 10.12 hereof.
Section 1.3 Construction. The terms defined in this Article 1 (except as
otherwise expressly provided in this Agreement) for all purposes shall have the
meanings set forth in Section 1.1 hereof, and the singular shall include the
plural, and vice versa, unless otherwise specifically required by the context.
All accounting terms used in this Agreement which are not otherwise defined
herein shall be construed in accordance with GAAP on a consolidated basis for
the Borrower and its Subsidiaries, unless otherwise expressly stated herein.
ARTICLE 2
Advances
Section 2.1 Revolving Credit Advances. Each Lender severally agrees, upon
the terms and subject to the conditions of this Agreement, to make Revolving
Credit Advances to the Borrower from time to time up to and including the
Maturity Date in an aggregate amount not to exceed an amount equal to its
Specified Percentage of the Commitment. Notwithstanding the immediately
preceding sentence, at no time shall the aggregate principal amount of Revolving
Credit Advances outstanding exceed the Commitment. Subject to Section 2.9
hereof, Revolving Credit Advances may be repaid and then reborrowed. Any
Revolving Credit Advance shall, at the option of the Borrower as provided in
Section 2.2 hereof (and, in the case of LIBOR Advances, subject to availability
and to the provisions of Article 7 hereof), be made as a Base Rate Advance or a
LIBOR Advance; provided that there shall not be outstanding to any Lender, at
any one time, more than eight LIBOR Advances. On the Maturity Date unless sooner
paid as provided herein, the outstanding Revolving Credit Advances shall be
repaid in full.
Section 2.2 Manner of Borrowing and Disbursement.
(a) In the case of Base Rate Advances, the Borrower, through an Authorized
Signatory, shall give the Administrative Lender prior to 10:30 a.m., Dallas,
Texas time, on the date of any proposed Base Rate Advance irrevocable written
notice, or irrevocable telephonic notice followed immediately by written notice
(provided, however, that the Borrower's failure to confirm any telephonic notice
in writing shall not invalidate any notice so given), of its intention to borrow
or reborrow a Base Rate Advance hereunder. Such notice of borrowing shall
specify the requested funding date, which shall be a Business Day, and the
amount of the proposed aggregate Base Rate Advances to be made by Lenders.
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(b) In the case of LIBOR Advances, the Borrower, through an Authorized
Signatory, shall give the Administrative Lender at least three Business Days'
irrevocable written notice for LIBOR Advances, or irrevocable telephonic notice
followed immediately by written notice (provided, however, that the Borrower's
failure to confirm any telephonic notice in writing shall not invalidate any
notice so given), of its intention to borrow or reborrow a LIBOR Advance
hereunder. Notice shall be given to the Administrative Lender prior to 11:00
a.m., Dallas, Texas time, in order for such Business Day to count toward the
minimum number of Business Days required. LIBOR Advances shall in all cases be
subject to availability and to Article 8 hereof. For LIBOR Advances, the notice
of borrowing shall specify the requested funding date, which shall be a Business
Day, the amount of the proposed aggregate LIBOR Advances to be made by Lenders
and the Interest Period selected by the Borrower, provided that no such Interest
Period shall extend past the Maturity Date.
(c) Subject to Sections 2.1 and 2.9 hereof, at least three Business Days
prior to each Payment Date for a LIBOR Advance, the Borrower, through an
Authorized Signatory, shall give the Administrative Lender irrevocable written
notice, or irrevocable telephonic notice followed immediately by written notice
(provided, however, that the Borrower's failure to confirm any telephonic notice
in writing shall not invalidate any notice so given), specifying whether all or
a portion of such LIBOR Advance outstanding on the Payment Date (i) is to be
repaid and then reborrowed in whole or in part as a Base Rate Advance or a LIBOR
Advance, or (ii) is to be repaid and not reborrowed; provided, however,
notwithstanding anything in this Agreement to the contrary, if on any Payment
Date a Default shall exist, such LIBOR Advance may only be reborrowed as a Base
Rate Advance. Upon such Payment Date, such LIBOR Advance shall, subject to the
provisions hereof, be so repaid and, as applicable, reborrowed.
(d) Subject to Sections 2.1 and 2.9 hereof, upon irrevocable written notice
to the Administrative Lender prior to 11:00 a.m., Dallas, Texas, time on the
date of payment of a Base Rate Advance (or three Business Days if the Borrower
wishes to reborrow a LIBOR Advance, through an Authorized Signatory, or
irrevocable telephonic notice followed immediately by written notice (provided,
however, that the Borrower's failure to confirm any telephonic notice in writing
shall not invalidate any notice so given), the Borrower may repay a Base Rate
Advance on such date, and (i) reborrow all or a portion of the principal amount
thereof as a Base Rate Advance, (ii) provided no Default or Event of Default has
occurred and is continuing, reborrow all or a portion of the principal amount
thereof as one or more LIBOR Advances, or (iii) not reborrow all or any portion
of such Base Rate Advance. Upon such date of repayment, such Base Rate Advance
shall, subject to the provisions hereof, be so repaid and, as applicable,
reborrowed.
(e) The aggregate amount of Base Rate Advances to be made by the Lenders on
any day shall be in a principal amount which is at least $1,000,000 and which is
an integral multiple of $100,000; provided, however, that such amount may equal
the unused amount of the Commitment. The aggregate amount of LIBOR Advances
having the same Interest Period and to be made by the Lenders on any day shall
be in a principal amount which is at least $3,000,000 and which is an integral
multiple of $500,000.
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(f) The Administrative Lender shall promptly notify the Lenders of each
notice received from the Borrower pursuant to this Section and the LIBOR Rate
for any proposed LIBOR Advance. Failure of the Borrower to give any notice in
accordance with Section 2.2(d) hereof shall result in a repayment of any such
existing LIBOR Advance on the applicable Payment Date by a Refinancing Advance
which is a Base Rate Advance. Each Lender shall, not later than 1:00 p.m.,
Dallas, Texas time, on the date of any Revolving Credit Advance that is not a
Refinancing Advance, deliver to the Administrative Lender, at its address set
forth herein, such Lender's Specified Percentage of such Revolving Credit
Advance in immediately available funds in accordance with the Administrative
Lender's instructions. Prior to 2:00 p.m., Dallas, Texas time, on the date of
any Revolving Credit Advance hereunder that is not a Refinancing Advance, the
Administrative Lender shall, subject to satisfaction of the conditions set forth
in Article 3, disburse the amounts made available to the Administrative Lender
by the Lenders by (i) transferring such amounts by wire transfer pursuant to the
Borrower's instructions, or (ii) in the absence of such instructions, crediting
such amounts to the account of the Borrower maintained with the Administrative
Lender. All Revolving Credit Advances shall be made by each Lender according to
its Specified Percentage. No Lender shall be relieved of its obligation to fund
its Specified Percentage of any Revolving Credit Advance notwithstanding the
fact that at any time the aggregate outstanding principal amount of all Bid Rate
Advances made by such Lender exceed its Specified Percentage of the Commitment.
Section 2.3 Interest.
(a) On Base Rate Advances.
(i) The Borrower shall pay interest on the outstanding unpaid
principal amount of each Base Rate Advance, from the date such Advance is
made until it is due (whether at maturity, by reason of acceleration, by
scheduled reduction, or otherwise) or repaid, which shall be payable as set
forth in Section 2.3(a)(ii) hereof, at a simple interest rate per annum
equal to the Base Rate Basis for such Base Rate Advance as in effect from
time to time, provided that interest on such Base Rate Advance shall not
exceed the Maximum Amount. If at any time the Base Rate Basis would exceed
the Highest Lawful Rate, interest payable on such Base Rate Advance shall
be limited to the Highest Lawful Rate, but the Base Rate Basis shall not
thereafter be reduced below the Highest Lawful Rate until the total amount
of interest accrued on such Advance equals the amount of interest that
would have accrued if the Base Rate Basis had been in effect at all times.
(ii) Interest on each Base Rate Advance shall be computed on the basis
of a year of 365 or 366 days, as applicable, for the number of days
actually elapsed, and shall be payable in arrears on each Quarterly Date
and on the Maturity Date.
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(b) On LIBOR Advances.
(i) The Borrower shall pay interest on the unpaid principal amount of
each LIBOR Advance, from the date such Advance is made until it is due
(whether at maturity, by reason of acceleration, by scheduled reduction, or
otherwise) or repaid, at a rate per annum equal to the LIBOR Basis for such
Advance. The Administrative Lender, whose determination shall be
conclusive, shall determine the LIBOR Basis on the second Business Day
prior to the applicable funding date and shall notify the Borrower and the
Lenders of such LIBOR Basis.
(ii) Subject to Section 10.9 hereof, interest on each LIBOR Advance
shall be computed on the basis of a 360-day year for the actual number of
days elapsed, and shall be payable in arrears on the applicable Payment
Date and on the Maturity Date; provided, however, that if the Interest
Period for such Advance exceeds three months, interest shall also be due
and payable in arrears on each Quarterly Date during such Interest Period.
(c) Interest if No Notice of Selection of Interest Rate Basis. If the
Borrower fails to give the Administrative Lender timely notice of its selection
of a LIBOR Basis or an Interest Period for a LIBOR Advance, or if for any reason
a determination of a LIBOR Basis for any Advance is not timely concluded due to
the fault of the Borrower, the appropriate Base Rate Basis shall apply to such
Advance.
(d) Interest After an Event of Default. (i) After an Event of Default
(other than an Event of Default specified in Section 7.1(f) of the Existing
Credit Agreement) and during any continuance thereof, at the option of
Determining Lenders, and (ii) after an Event of Default specified in Section
7.1(f) of the Existing Credit Agreement and during any continuance thereof,
automatically and without any action by the Administrative Lender or any Lender,
the Obligations shall bear interest at a rate per annum equal to the Default
Rate. Such interest shall be payable on the earlier of demand or the Maturity
Date, and shall accrue until the earlier of (i) waiver or cure (to the
satisfaction of the Determining Lenders) of the applicable Event of Default,
(ii) agreement by the Lenders to rescind the charging of interest at the Default
Rate, or (iii) payment in full of the Obligations. The Lenders shall not be
required to accelerate the maturity of the Advances, to exercise any other
rights or remedies under the Loan Papers, or to give notice to the Borrower of
the decision to charge interest at the Default Rate. The Lenders will undertake
to notify the Borrower, after the effective date, of the decision to charge
interest at the Default Rate.
Section 2.4 Fees. Subject to Section 9.9 hereof, the Borrower agrees to pay
to the Administrative Lender, for the account of each Lender as of the Agreement
Date a closing fee as agreed to by the Borrower and each such Lender set forth
in a separate letter, dated as of the Agreement Date. Such fee shall be payable
on the date of the initial Advance, fully earned when due and, subject to
Section 10.9 hereof, nonrefundable when paid.
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Section 2.5 Prepayment.
(a) Voluntary Prepayments. The principal amount of any Base Rate Advance
may be prepaid in full or in part at any time, without penalty and without
regard to the Payment Date for such Advance, upon notice as required for a
repayment of a Base Rate Advance as provided in Section 2.2(d) hereof. LIBOR
Advances may be voluntarily prepaid upon notice as required for repayments of
LIBOR Advances as provided in Section 2.2(c) hereof, but only so long as the
Borrower concurrently reimburses the Lenders in accordance with Section 2.9
hereof. Any notice of prepayment shall be irrevocable.
(b) Mandatory Prepayment. On or before the date of any reduction of the
Commitment, the Borrower shall prepay outstanding Advances in an amount
necessary to reduce the same to an amount less than or equal to the Commitment
as so reduced. The Borrower shall first prepay all Base Rate Advances, and shall
thereafter prepay LIBOR Advances. To the extent that any prepayment requires
that a LIBOR Advance be repaid on a date other than the last day of its Interest
Period, the Borrower shall reimburse each Lender in accordance with Section 2.9
hereof. To the extent that outstanding Advances exceed the Commitment after any
reduction thereof, the Borrower shall repay any such excess amount and all
accrued interest thereon on the date of such reduction.
(c) Prepayments, Generally. Any prepayment of an Advance shall be
accompanied by interest accrued on the principal amount being prepaid. Any
voluntary partial prepayment of a Base Rate Advance shall be in a principal
amount of $100,000 or an integral multiple thereof. All voluntary prepayments
shall be applied in the order directed in writing by the Borrower to the
Administrative Lender.
Section 2.6 Reduction of Commitment.
(a) Voluntary Reduction. The Borrower shall have the right, upon not less
than 10 Business Days' notice (provided no notice shall be required for a
termination in whole of the Commitment) by an Authorized Signatory to the
Administrative Lender (if telephonic, to be confirmed by telex or in writing on
or before the date of reduction or termination), which shall promptly notify the
Lenders, to terminate or reduce the Commitment, in whole or in part. Each
partial termination shall be in an aggregate amount which is at least $1,000,000
and which is an integral multiple of $100,000, and no voluntary reduction in the
Commitment shall cause any LIBOR Advance to be repaid prior to the last day of
its Interest Period.
(b) Mandatory Reduction. On the Maturity Date, the Commitment shall
automatically reduce to zero.
(c) General Requirements. Upon any reduction of the Commitment pursuant to
this Section, the Borrower shall immediately make a repayment of applicable
Advances in accordance with Section 2.5(b) hereof. The Borrower shall reimburse
each Lender for any loss or out-of-pocket expense incurred by each Lender in
connection with any such payment, as set forth in
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Section 2.9 hereof to the extent applicable. The Borrower shall not have any
right to rescind any termination or reduction. Once reduced, the Commitment may
not be increased or reinstated.
Section 2.7 Non-Receipt of Funds by the Administrative Lender. Unless the
Administrative Lender shall have been notified by a Lender prior to the date of
any proposed Revolving Credit Advance (which notice shall be effective upon
receipt) that such Lender does not intend to make the proceeds of such Revolving
Credit Advance available to the Administrative Lender, the Administrative Lender
may assume that such Lender has made such proceeds available to the
Administrative Lender on such date, and the Administrative Lender may in
reliance upon such assumption (but shall not be required to) make available to
the Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Lender by such Lender, the Administrative
Lender shall, without prejudice to the Borrower's rights against such Lender, be
entitled to recover such amount on demand from such Lender (or, if such Lender
fails to pay such amount forthwith upon such demand, from the Borrower) together
with interest thereon in respect of each day during the period commencing on the
date such amount was available to the Borrower and ending on (but excluding) the
date the Administrative Lender receives such amount from the Lender, at a per
annum rate equal to the lesser of (i) the Highest Lawful Rate or (ii)(A) in the
case of such Lender, the Federal Funds Rate or (B) in the case of the Borrower,
the interest rate applicable to such Revolving Credit Advance. No Lender shall
be liable for any other Lender's failure to fund a Revolving Credit Advance
hereunder.
Section 2.8 Payment of Principal of Advances. The Borrower agrees to pay
the principal amount of the Advances to the Administrative Lender for the
account of the Lenders as follows:
(a) End of Interest Period. The principal amount of each Advance hereunder
shall be due and payable on its Payment Date, which principal payment may be
made by means of a Refinancing Advance.
(b) Commitment Reduction. On the date of reduction of the Commitment
pursuant to Section 2.6 hereof, including the Maturity Date, the aggregate
amount of the Advances outstanding on such date of reduction in excess of the
Commitment as reduced shall be due and payable, which principal payment may not
be made by means of Refinancing Advances.
(c) Maturity Date. To the extent not otherwise required to be paid earlier
as provided herein, the principal amount of the Advances, all accrued interest
and fees thereon, and all other Obligations related thereto, shall be due and
payable in full on the Maturity Date.
Section 2.9 Reimbursement. Whenever any Lender shall sustain or incur any
losses or reasonable out-of-pocket expenses in connection with (a) failure by
the Borrower to borrow or repay any LIBOR Advance after having given notice of
its intention to borrow or repay in accordance with Section 2.2 hereof (whether
by reason of the Borrower's election not to proceed or the non-fulfillment of
any of the conditions set forth in Article 3 hereof), or (b) any prepayment for
any reason of any LIBOR Advance in whole or in part, the Borrower agrees to pay
to any such
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Lender, upon its demand, an amount sufficient to compensate such Lender for all
such losses and out-of-pocket expenses, subject to Section 9.9 hereof. Such
Lender's good faith determination of the amount of such losses or out-of-pocket
expenses, calculated in its usual fashion, absent manifest error, shall be
binding and conclusive. Such losses shall include, without limiting the
generality of the foregoing, lost profits and reasonable expenses incurred by
such Lender in connection with the re-employment of funds prepaid, repaid,
converted or not borrowed, converted or paid, as the case may be. Upon request
of the Borrower, such Lender shall provide a certificate setting forth the
amount to be paid to it by the Borrower hereunder and calculations therefor.
Section 2.10 Manner of Payment.
(a) Each payment (including prepayments) by the Borrower of the principal
of or interest on the Advances, fees, and any other amount owed under this
Agreement or any other Loan Paper shall be made not later than 12:00 noon
(Dallas, Texas time) on the date specified for payment under this Agreement to
the Administrative Lender at the Administrative Lender's office, in lawful money
of the United States of America constituting immediately available funds.
(b) If any payment under this Agreement or any other Loan Paper shall be
specified to be made upon a day which is not a Business Day, it shall be made on
the next succeeding day which is a Business Day, unless such Business Day falls
in another calendar month, in which case payment shall be made on the preceding
Business Day. Any extension of time shall in such case be included in computing
interest and fees, if any, in connection with such payment.
(c) The Borrower agrees to pay principal, interest, fees and all other
amounts due under the Loan Papers without deduction for set-off or counterclaim
or any deduction whatsoever.
(d) If some but less than all amounts due from the Borrower are received by
the Administrative Lender, the Administrative Lender shall apply such amounts in
the following order of priority: (i) to the payment of the Administrative
Lender's expenses incurred on behalf of the Lenders then due and payable, if
any; (ii) to the payment of all other fees and amounts then due and payable
under the Loan Papers; (iii) to the payment of interest then due and payable on
the Advances; (iv) to the payment of principal then due and payable on the
Advances; and (v) to the payment of any outstanding Reimbursement Obligations.
(e) Each payment by the Borrower in respect of obligations relating to the
Revolving Credit Advances (whether for principal, interest, fees or otherwise)
shall be made to the Administrative Lender for the account of the Lenders pro
rata in accordance with their respective Specified Percentages.
Section 2.11 LIBOR Lending Offices. Each Lender's initial LIBOR Lending
Office is set forth opposite its name in Schedule 1 attached hereto. Each Lender
shall have the right at any time and from time to time to designate a different
office of itself or of any Affiliate as such Lender's LIBOR Lending Office, and
to transfer any outstanding LIBOR Advance to such LIBOR Lending Office. No such
designation or transfer shall result in any liability on the part of the
Borrower for
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increased costs or expenses resulting solely from such designation or transfer
(except any such transfer which is made by a Lender pursuant to Section 7.2 or
7.3 hereof, or otherwise for the purpose of complying with Applicable Law).
Increased costs for expenses resulting from a change in law occurring subsequent
to any such designation or transfer shall be deemed not to result solely from
such designation or transfer.
Section 2.12 Sharing of Payments. Any Lender obtaining a payment (whether
voluntary or involuntary, due to the exercise of any right of set-off, or
otherwise) on account of its Revolving Credit Advances (other than pursuant to
Sections 2.15, 7.3 or 7.5), in excess of its Specified Percentage of all
payments made by the Borrower with respect to Revolving Credit Advances shall
purchase from each other Lender such participation in the Revolving Credit
Advances made by such other Lender as shall be necessary to cause such
purchasing Lender to share the excess payment pro rata according to Specified
Percentages with each other Lender; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Lender, the purchase shall be rescinded and the purchase price restored to the
extent of such recovery, but without interest. The Borrower agrees that any
Lender so purchasing a participation from another Lender pursuant to this
Section, to the fullest extent permitted by law, may exercise all its rights of
payment (including the right of set-off) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower in the amount
of such participation.
Section 2.13 Calculation of Rates. The provisions of this Agreement
relating to calculation of the LIBOR 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, it being understood that each Lender shall be entitled to
fund and maintain its funding of all or any part of a LIBOR Advance as it sees
fit.
Section 2.14 Booking Loans. Any Lender may make, carry or transfer Advances
at, to or for the account of any of its branch offices or the office of any
Affiliate.
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Section 2.15 Taxes.
(a) Any and all payments by the Borrower hereunder shall be made, in
accordance with Section 2.10, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges and
withholdings, and all liabilities with respect thereto, excluding, in the case
of each Lender and the Administrative Lender, taxes imposed on, based upon or
measured by its overall net income, net worth or capital, and franchise taxes,
doing business taxes or minimum taxes imposed on it, (i) by the jurisdiction
under the laws of which such Lender or the Administrative Lender (as the case
may be) is organized and in which it has its applicable lending office or any
political subdivision thereof; (ii) by any other jurisdiction, or any political
subdivision thereof, other than those imposed by reason of (A) an asserted
relation of such jurisdiction to the transactions contemplated by this
Agreement, (B) the activities of the Borrower in such jurisdiction, or (C) the
activities in connection with the transactions contemplated by this Agreement of
a Lender or the Administrative Lender; (iii) by reason of failure by the Lender
or the Administrative Lender to comply with the requirements of paragraph (e) of
this Section 2.15; and (iv) in the case of any Lender, any Taxes in the nature
of transfer, stamp, recording or documentary taxes resulting from a transfer
(other than as a result of foreclosure) by such Lender of all or any portion of
its interest in this Agreement, the Notes or any other Loan Papers (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any Lender or the Administrative Lender, (x) the sum payable shall
be increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
2.15) such Lender or the Administrative Lender (as the case may be) receives an
amount equal to the sum it would have received had no such deductions been made,
(y) the Borrower shall make such deductions and (z) the Borrower shall pay the
full amount deducted to the relevant taxation authority or other authority in
accordance with Applicable Law.
(b) In addition, the Borrower agrees to pay any and all stamp and
documentary taxes and any and all other excise and property taxes, charges and
similar levies (other than (i) Taxes described in clause (iv) of the first
sentence of Section 2.15(a) and (ii) mortgage taxes payable in Oklahoma) that
arise from any payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to, this Agreement or any other Loan
Paper (hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each Lender and the Administrative Lender
for the full amount of Taxes and Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this
Section 2.15) paid by such Lender or the Administrative Lender (as the case may
be) and all liabilities (including penalties, additions to tax, interest and
reasonable expenses) arising therefrom or with respect thereto whether or not
such Taxes or Other Taxes were correctly or legally asserted, other than
penalties, additions to tax, interest and expenses arising as a result of gross
negligence on the part of such Lender or the Administrative Lender, provided,
however, that the Borrower shall have no obligation to indemnify such Lender or
the Administrative Lender unless and until such Lender or the Administrative
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Lender shall have delivered to the Borrower a certificate setting forth in
reasonable detail the basis of the Borrower's obligation to indemnify such
Lender or the Administrative Lender pursuant to this Section 2.15. This
indemnification shall be made within 30 days from the date such Lender or the
Administrative Lender (as the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
will furnish to the Administrative Lender the original or a certified copy of a
receipt evidencing payment thereof. If no Taxes are payable in respect of any
payment hereunder, the Borrower will furnish to the Administrative Lender a
certificate from each appropriate taxing authority, or an opinion of counsel
acceptable to the Administrative Lender, in either case stating that such
payment is exempt from or not subject to Taxes, provided, however, that such
certificate or opinion need only be given if: (i) the Borrower makes any payment
from any account located outside the United States, or (ii) the payment is made
by a payor that is not a United States Person. For purposes of this Section 2.15
the terms "United States" and "United States Person" shall have the meanings set
forth in Section 7701 of the Code.
(e) Each Lender which is not a United States Person hereby agrees that:
(i) it shall, no later than the Agreement Date (or, in the case of a
Lender which becomes a party hereto pursuant to Section 10.6 after the
Agreement Date, the date upon which such Lender becomes a party hereto)
deliver to the Borrower through the Administrative Lender, with a copy to
the Administrative Lender:
(A) if any lending office is located in the United States of America,
two (2) accurate and complete signed originals of Internal
Revenue Service Form 4224 or any successor thereto ("Form 4224"),
(B) if any lending office is located outside the United States of
America, two (2) accurate and complete signed originals of
Internal Revenue Service Form 1001 or any successor thereto
("Form 1001").
in each case indicating that such Lender is on the date of delivery thereof
entitled to receive payments of principal, interest and fees for the
account of such lending office or lending offices under this Agreement free
from withholding of United States Federal income tax;
(ii) if at any time such Lender changes its lending office or lending
offices or selects an additional lending office it shall, at the same time
or reasonably promptly thereafter but only to the extent the forms
previously delivered by it hereunder are no longer effective, deliver to
the Borrower through the Administrative Lender, with a copy to the
Administrative Lender, in replacement for the forms previously delivered by
it hereunder:
(A) if such changed or additional lending office is located in the
United States of America, two (2) accurate and complete signed
originals of Form 4224; or
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(B) otherwise, two (2) accurate and complete signed originals of Form
1001,
in each case indicating that such Lender is on the date of delivery thereof
entitled to receive payments of principal, interest and fees for the
account of such changed or additional lending office under this Agreement
free from withholding of United States Federal income tax;
(iii) it shall, before or promptly after the occurrence of any event
(including the passing of time but excluding any event mentioned in clause
(ii) above) requiring a change in the most recent Form 4224 or Form 1001
previously delivered by such Lender and if the delivery of the same be
lawful, deliver to the Borrower through the Administrative Lender with a
copy to the Administrative Lender, two (2) accurate and complete original
signed copies of Form 4224 or Form 1001 in replacement for the forms
previously delivered by such Lender;
(iv) it shall, promptly upon the request of the Borrower to that
effect, deliver to the Borrower such other forms or similar documentation
as may be required from time to time by any applicable law, treaty, rule or
regulation in order to establish such Lender's tax status for withholding
purposes; and
(v) it shall notify the Borrower within 30 days after any event
(including an amendment to, or a change in any applicable law or regulation
or in the written interpretation thereof by any regulatory authority or any
judicial authority, or by ruling applicable to such Lender of any
governmental authority charged with the interpretation or administration of
any law) shall occur that results in such Lender no longer being capable of
receiving payments without any deduction or withholding of United States
federal income tax.
(f) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
this Section 2.15 shall survive the payment in full of principal and interest
hereunder.
(g) Any Lender claiming any additional amounts payable pursuant to this
Section 2.15 shall use its reasonable best efforts (consistent with its internal
policy and legal and regulatory restrictions) to change the jurisdiction of its
lending office, if the making of such a change would avoid the need for, or
reduce the amount of, any such additional amounts which may thereafter accrue
and would not, in the reasonable judgment of such Lender, be materially
disadvantageous to such Lender.
(h) Each Lender (and the Administrative Lender with respect to payments to
the Administrative Lender for its own account) agrees that (i) it will take all
reasonable actions by all usual means to maintain all exemptions, if any,
available to it from United States withholding taxes (whether available by
treaty, existing administrative waiver, by virtue of the location of any
Lender's lending office) and (ii) otherwise cooperate with the Borrower to
minimize amounts
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payable by the Borrower under this Section 2.15; provided, however, the Lenders
and the Administrative Lender shall not be obligated by reason of this Section
2.15(h) to contest the payment of any Taxes or Other Taxes or to disclose any
information regarding its tax affairs or tax computations or reorder its tax or
other affairs or tax or other planning. Subject to the foregoing, to the extent
the Borrower pays sums pursuant to this Section 2.15 and the Lender or the
Administrative Lender receives a refund of any or all of such sums, such refund
shall be applied to reduce any amounts then due and owing under this Agreement
or, to the extent that no amounts are due and owing under this Agreement at the
time such refunds are received, the party receiving such refund shall promptly
pay over all such refunded sums to the Borrower, provided that no Default or
Event of Default is in existence at such time.
ARTICLE 3
Conditions Precedent
Section 3.1 Conditions Precedent to the Initial Advances. The obligation of
each Lender to sign this Agreement and to make any Advance is subject to receipt
by the Administrative Lender of the following, in form and substance
satisfactory to each Lender, with a copy (except for the Notes) for each Lender,
or satisfaction of the following:
(a) a loan certificate of the Borrower certifying as to the accuracy of its
representations and warranties in the Loan Papers, certifying that no Default
has occurred, and including a certificate of incumbency with respect to each
Authorized Signatory, and including a copy of the resolutions of the Borrower
authorizing it to execute, deliver and perform this Agreement, the Notes and the
other Loan Papers to which it is a party;
(b) a certificate of an officer acceptable to the Lenders of each
Significant Subsidiary, certifying as to the incumbency of the officers signing
the Loan Papers to which it is a party, and including a copy of the resolutions
authorizing it to execute, deliver and perform the Loan Papers to which it is a
party;
(c) duly executed Revolving Credit Notes, payable to the order of the
respective Lenders and in an amount for each Lender equal to its Specified
Percentage of the Commitment;
(d) opinions of counsel to the Borrower and the Subsidiaries addressed to
the Lenders and in form and substance satisfactory to the Lenders, dated the
Agreement Date, and covering such matters incident to the transactions
contemplated hereby as the Administrative Lender or Special Counsel may
reasonably request;
(e) reimbursement for the Administrative Lender for Special Counsel's
reasonable fees and expenses rendered through the Agreement Date;
(f) evidence that all corporate or other proceedings of the Borrower and
Subsidiaries
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taken in connection with the transactions contemplated by this Agreement and the
other Loan Papers shall be reasonably satisfactory in form and substance to the
Lenders and Special Counsel; and the Lenders shall have received copies of all
documents or other evidence which the Administrative Lender, Special Counsel or
any Lender may reasonably request in connection with such transactions;
(g) the closing fee as required pursuant to Section 2.4;
(h) the duly executed and completed Guaranty Agreements, dated as of the
Agreement Date; and
(i) in form and substance satisfactory to the Lenders and Special Counsel,
such other documents, instruments and certificates as the Administrative Lender
or any Lender may reasonably require in connection with the transactions
contemplated hereby, including without limitation the status, organization or
authority of the Borrower or any Subsidiary or any other Person executing a Loan
Paper, and the enforceability of the Obligation.
Section 3.2 Conditions Precedent to All Advances. The obligation of each
Lender to make each Advance hereunder is subject to fulfillment of the following
conditions immediately prior to or contemporaneously with each such Advance;
(a) With respect to Advances other than Refinancing Advances, all of the
representations and warranties of the Borrower under this Agreement, which,
pursuant to Section 4.2 hereof, are made at and as of the time of such Advance
or issuance, shall be true and correct at such time in all material respects,
both before and after giving effect to the application of the proceeds of the
Advance;
(b) The incumbency of the Authorized Signatories shall be as stated in the
certificate of incumbency delivered in the Borrower's loan certificate pursuant
to Section 3.1(a) or as subsequently modified and reflected in a certificate of
incumbency delivered to the Administrative Lender. The Lenders may, without
waiving this condition, consider it fulfilled and a representation by the
Borrower made to such effect if no written notice to the contrary, dated on or
before the date of such Advance, is received by the Administrative Lender from
the Borrower prior to the making of such Advance;
(c) There shall not exist a Default hereunder, with respect to Advances
other than Refinancing Advances, or an Event of Default, with respect to any
Refinancing Advance, and, with respect to each Advance other than a Refinancing
Advance, the Administrative Lender shall have received written or telephonic
certification thereof by an Authorized Signatory (which certification, if
telephonic, shall be followed promptly by written certification);
(d) The aggregate Advances, after giving effect to such proposed Advance
shall not exceed the maximum principal amount then permitted to be outstanding
hereunder;
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(e) The Administrative Lender shall have received all such other
certificates, reports, statements, opinions of counsel or other documents as the
Administrative Lender or any Lender may reasonably request; and
(f) The making of such Advance by any Lender does not violate or contravene
any Applicable Law and is not enjoined, temporarily, preliminarily or
permanently.
ARTICLE 4
Representations and Warranties
Section 4.1 Representations and Warranties. The Borrower hereby represents
and warrants to each Lender as follows:
(a) Existing Credit Agreement Representations and Warranties. All of the
representations and warranties of the Borrower set forth in Article 4 of the
Existing Credit Agreement (the "Existing Credit Agreement Representations and
Warranties") are hereby reaffirmed by the Borrower and are incorporated herein
as written, mutatis mutandis. The Borrower hereby represents and warrants that
the Existing Credit Agreement Representations and Warranties are true and
correct in all material respects as though made on and as of the Agreement Date.
(b) Authorization. The Borrower has corporate power and has taken all
necessary corporate action to authorize it to borrow hereunder. Each of the Loan
Parties has corporate or other power and has taken all necessary corporate or
other action to execute, deliver and perform the Loan Papers to which it is
party in accordance with the terms thereof, and to consummate the transactions
contemplated thereby. Each Loan Paper has been duly executed and delivered by
the Loan Party executing it. Each of the Loan Papers to which the Loan Parties
are party is a legal, valid and binding respective obligation of the Loan Party
executing it, enforceable in accordance with its terms, subject to the following
qualifications: (i) equitable principles generally, and (ii) Debtor Relief Laws
(insofar as any such law relates to the bankruptcy, insolvency or similar event
of any Loan Party).
(c) Compliance with Other Loan Papers and Contemplated Transactions. The
execution, delivery and performance by the Loan Parties of the Loan Papers to
which they are respectively a party, and the consummation of the transactions
contemplated thereby, do not and will not (i) require any consent or approval
not already obtained, (ii) violate any Applicable Law, (iii) conflict with,
result in a breach of, or constitute a default under the articles of
incorporation, by-laws, articles of partnership, partnership agreements or
similar governing documents of any Loan Party, or under any Necessary
Authorization, indenture, agreement or other instrument, to which any Loan Party
is a party or by which they or their respective properties may be bound, or (iv)
result in or require the creation or imposition of any Lien upon or with respect
to any property now owned or hereafter acquired by any Loan Party.
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(d) Compliance with Regulations G, T, U and X. No part of the proceeds of
the Advances will be used to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin stock.
None of the Borrower and its Subsidiaries nor any agent acting on their behalf,
have taken or will knowingly take any action which might cause this Agreement or
any other Loan Papers to violate any regulation of the Board of Governors of the
Federal Reserve System or to violate the Securities Exchange Act of 1934, in
each case as in effect now or as the same may hereafter be in effect.
(e) Disclosure. Neither this Agreement nor any other document, certificate
or statement which has been furnished to any Lender by or on behalf of the
Borrower or any Subsidiary or Unincorporated Venture in connection herewith
contained any untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statement contained herein and therein not
misleading at the time it was furnished. There is no fact known to the Borrower
and not known to the public generally that could reasonably be expected to
materially adversely affect the assets or business of the Borrower and its
Subsidiaries and Unincorporated Ventures, or in the future could reasonably be
expected (so far as the Borrower can now foresee) to have a Material Adverse
Effect, which has not been set forth in this Agreement or in the documents,
certificates and statements furnished to the Lenders by or on behalf of the
Borrower prior to the date hereof in connection with the transaction
contemplated hereby.
Section 4.2 Survival of Representations and Warranties, etc. All
representations and warranties made under this Agreement and the other Loan
Papers shall be deemed to be made at and as of the Agreement Date and at and as
of the date of each Advance, and each shall be true and correct when made,
except to the extent (a) previously fulfilled in accordance with the terms
hereof, (b) applicable to a specific date or modified to give effect to the
transactions expressly permitted hereby, or (c) previously waived in writing by
the Determining Lenders with respect to any particular factual circumstance. All
such representations and warranties shall survive, and not be waived by, the
execution hereof by any Lender, any investigation or inquiry by any Lender, or
by the making of any Advance under this Agreement.
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ARTICLE 5
Covenants
Section 5.1 Existing Credit Agreement. Until the termination of the
Commitment and payment of all outstanding Obligations in full, the Borrower will
comply with all of the covenants and agreements set forth in Articles 5 and 6 of
the Existing Credit Agreement as in effect on the Agreement Date. For purposes
of this Agreement, all of the covenants and agreements of the Borrower set forth
in Articles 5 and 6 of the Existing Credit Agreement and all definitions
relating thereto are hereby reaffirmed and adopted by the Borrower and are
incorporated herein as written and agreed upon as of the Agreement Date, mutatis
mutandis. In the event of termination of the Existing Credit Agreement prior to
the payment in full of all Obligations under this Agreement and termination of
the Commitment, the Borrower covenants and agrees that the covenants and
agreements of the Borrower contained in Articles 5 and 6 of the Existing Credit
Agreement shall nevertheless remain in full force and effect and be binding upon
the Borrower, and the Borrower shall continue to perform, observe and comply
with all of the covenants and agreements of the Borrower set forth in Articles 5
and 6 of the Existing Credit Agreement. No amendment, modification or waiver
with respect to Articles 5 or 6 of the Existing Credit Agreement shall be
effective with respect to such Articles as they are incorporated herein without
the written consent of the Determining Lenders.
Section 5.2 Use of Proceeds. The Borrower shall use the proceeds of the
Commitment for working capital and general corporate purposes, including inn
development.
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Section 5.3 Indemnity.
(a) THE BORROWER AGREES TO DEFEND, PROTECT, INDEMNIFY AND HOLD HARMLESS THE
ADMINISTRATIVE LENDER, EACH LENDER, EACH OF THEIR RESPECTIVE AFFILIATES, AND
EACH OF THEIR RESPECTIVE (INCLUDING SUCH AFFILIATES') OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS, ATTORNEYS, SHAREHOLDERS AND CONSULTANTS (INCLUDING, WITHOUT
LIMITATION, THOSE RETAINED IN CONNECTION WITH THE SATISFACTION OR ATTEMPTED
SATISFACTION OF ANY OF THE CONDITIONS SET FORTH HEREIN) OF EACH OF THE FOREGOING
(COLLECTIVELY, "INDEMNITEES") FROM AND AGAINST ANY AND ALL LIABILITIES,
OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, CLAIMS,
COSTS, EXPENSES AND DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER (INCLUDING,
WITHOUT LIMITATION, THE FEES AND DISBURSEMENTS OF COUNSEL FOR SUCH INDEMNITEES
IN CONNECTION WITH ANY INVESTIGATIVE, ADMINISTRATIVE OR JUDICIAL PROCEEDING,
WHETHER OR NOT SUCH INDEMNITEES SHALL BE DESIGNATED A PARTY THERETO), IMPOSED
ON, INCURRED BY, OR ASSERTED AGAINST SUCH INDEMNITEES (WHETHER DIRECT, INDIRECT
OR CONSEQUENTIAL AND WHETHER BASED ON ANY FEDERAL, STATE, OR LOCAL LAWS AND
REGULATIONS, UNDER COMMON LAW OR AT EQUITABLE CAUSE, OR ON CONTRACT, TORT OR
OTHERWISE, ARISING FROM OR CONNECTED WITH THE PAST, PRESENT OR FUTURE OPERATIONS
OF THE BORROWER OR ANY OTHER OBLIGOR OR THEIR RESPECTIVE PREDECESSORS IN
INTEREST, OR THE PAST, PRESENT OR FUTURE ENVIRONMENTAL CONDITION OF PROPERTY OF
THE BORROWER OR ANY OTHER OBLIGOR), IN ANY MANNER RELATING TO OR ARISING OUT OF
THIS AGREEMENT, ANY OTHER LOAN PAPERS, OR ANY ACT, EVENT OR TRANSACTION OR
ALLEGED ACT, EVENT OR TRANSACTION RELATING OR ATTENDANT THERETO, THE MAKING OF
ANY PARTICIPATIONS IN THE ADVANCES AND THE MANAGEMENT OF THE ADVANCES, INCLUDING
IN CONNECTION WITH, OR AS A RESULT, IN WHOLE OR IN PART, OF ANY NEGLIGENCE OF
ADMINISTRATIVE LENDER OR ANY LENDER (OTHER THAN THOSE MATTERS RAISED EXCLUSIVELY
BY A PARTICIPANT AGAINST THE ADMINISTRATIVE LENDER OR ANY LENDER AND NOT THE
BORROWER), OR THE USE OR INTENDED USE OF THE PROCEEDS OF THE ADVANCES HEREUNDER,
OR IN CONNECTION WITH ANY INVESTIGATION OF ANY POTENTIAL MATTER COVERED HEREBY,
BUT EXCLUDING (i) ANY CLAIM OR LIABILITY THAT ARISES AS THE RESULT OF THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY INDEMNITEE, AS FINALLY JUDICIALLY
DETERMINED BY A COURT OF COMPETENT JURISDICTION, AND (ii) MATTERS RAISED BY ONE
LENDER AGAINST ANOTHER LENDER OR BY ANY SHAREHOLDERS OF A LENDER AGAINST A
LENDER OR ITS MANAGEMENT (COLLECTIVELY, "INDEMNIFIED MATTERS"). TO THE EXTENT
THAT ANY INDEMNIFIED MATTER INVOLVES ONE OR MORE INDEMNITEES, SUCH INDEMNITEES
SHALL USE THE SAME LEGAL COUNSEL UNLESS ANY INDEMNITEE IN ITS REASONABLE
DISCRETION DETERMINES THAT CONFLICTS EXIST OR MAY ARISE IN CONNECTION WITH SUCH
REPRESENTATION.
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(b) IN ADDITION, THE BORROWER SHALL PERIODICALLY, UPON REQUEST, REIMBURSE
EACH INDEMNITEE FOR ITS REASONABLE LEGAL AND OTHER ACTUAL EXPENSES (INCLUDING
THE COST OF ANY INVESTIGATION AND PREPARATION) INCURRED IN CONNECTION WITH ANY
INDEMNIFIED MATTER. IF FOR ANY REASON THE FOREGOING INDEMNIFICATION IS
UNAVAILABLE TO ANY INDEMNITEE OR INSUFFICIENT TO HOLD ANY INDEMNITEE HARMLESS
WITH RESPECT TO INDEMNIFIED MATTERS, THEN THE BORROWER SHALL CONTRIBUTE TO THE
AMOUNT PAID OR PAYABLE BY SUCH INDEMNITEE AS A RESULT OF SUCH LOSS, CLAIM,
DAMAGE OR LIABILITY IN SUCH PROPORTION AS IS APPROPRIATE TO REFLECT NOT ONLY THE
RELATIVE BENEFITS RECEIVED BY THE BORROWER AND THE BORROWER'S STOCKHOLDERS ON
THE ONE HAND AND SUCH INDEMNITEE ON THE OTHER HAND BUT ALSO THE RELATIVE FAULT
OF THE BORROWER AND SUCH INDEMNITEE, AS WELL AS ANY OTHER RELEVANT EQUITABLE
CONSIDERATIONS. THE REIMBURSEMENT, INDEMNITY AND CONTRIBUTION OBLIGATIONS UNDER
THIS SECTION SHALL BE IN ADDITION TO ANY LIABILITY WHICH THE BORROWER MAY
OTHERWISE HAVE, SHALL EXTEND UPON THE SAME TERMS AND CONDITIONS TO EACH
INDEMNITEE, AND SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF ANY
SUCCESSORS, ASSIGNS, HEIRS AND PERSONAL REPRESENTATIVES OF THE BORROWER, THE
ADMINISTRATIVE LENDER, THE LENDERS AND ALL OTHER INDEMNITEES. THIS SECTION SHALL
SURVIVE ANY TERMINATION OF THIS AGREEMENT AND PAYMENT OF THE OBLIGATIONS.
ARTICLE 6
Default
Section 6.1 Events of Default. Each of the following shall constitute an
Event of Default, whatever the reason for such event, and whether voluntary,
involuntary, or effected by operation of law or pursuant to any judgment or
order of any court or any order, rule or regulation of any governmental or
non-governmental body:
(a) The Borrower fails to make any payment of principal on any Note on the
date such payment is due;
(b) The Borrower fails to make any payment of interest on any Note or any
other costs, fees, expenses or other amounts payable hereunder or under the
other Loan Papers within one Business Day after the date such payment is due;
(c) The Borrower or any Subsidiary or Unincorporated Venture fails to
perform or observe (i) any covenant contained in Section 5.1 (after giving
effect to any notice or grace period provided in the Existing Credit Agreement
with respect to any of the covenants incorporated herein)
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or 5.2 of this Agreement or (ii) any other covenant in this Agreement or any
other Loan Paper to be performed or observed by it and such failure with respect
to such other covenants continues for a period of 30 days after any Lender has
given written notice specifying such failure to the Borrower;
(d) Any material warranty or representation by or on behalf of the Borrower
or any Subsidiary or Unincorporated Venture contained in this Agreement
(including the Existing Credit Agreement Representations and Warranties) or any
other Loan Paper is false or misleading in any material respect;
(e) Any material provision of any Loan Paper after delivery thereof
hereunder shall for any reason cease to be valid and binding on the Person
(other than any Lender) executing such Loan Paper, or the Borrower or such
Person shall so state in writing; or
(f) An "Event of Default" as defined in the Existing Credit Agreement shall
occur (or if the Existing Credit Agreement is no longer in effect, an "Event of
Default" as defined therein would have occurred had the Existing Credit
Agreement been in effect).
Section 6.2 Remedies. If an Event of Default shall have occurred and shall
be continuing:
(a) With the exception of an Event of Default specified in Section 7.1(f)
of the Existing Credit Agreement, the Administrative Lender shall, upon the
direction of the Determining Lenders, terminate the Commitment and/or declare
the principal of and interest on the Advances and all Obligations and other
amounts owed under the Loan Papers to be forthwith due and payable without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived, anything in the Loan Papers to the contrary notwithstanding.
(b) Upon the occurrence of an Event of Default specified in Section 7.1(f)
of the Existing Credit Agreement, such principal, interest and other amounts
shall thereupon and concurrently therewith become due and payable and the
Commitment shall automatically forthwith terminate, all without any action by
the Administrative Lender, any Lender or any holders of the Notes and without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived, anything in the Loan Papers to the contrary notwithstanding.
(c) The Administrative Lender, and the Lenders may exercise all of the
post-default rights granted to them under the Loan Papers or under Applicable
Law.
(d) The rights and remedies of the Administrative Lender and the Lenders
hereunder shall be cumulative, and not exclusive.
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ARTICLE 7
Changes in Circumstances
Section 7.1 LIBOR Basis Determination Inadequate. If with respect to any
proposed LIBOR Advance for any Interest Period, any Lender determines that (i)
deposits in dollars (in the applicable amount) are not being offered to that
Lender in the relevant market for such Interest Period or (ii) the LIBOR Basis
for such proposed LIBOR Advance does not adequately cover the cost to such
Lender of making and maintaining such proposed LIBOR Advance for such Interest
Period, such Lender shall forthwith give notice thereof to the Borrower,
whereupon until such Lender notifies the Borrower that the circumstances giving
rise to such situation no longer exist, the obligation of such Lender to make
LIBOR Advances shall be suspended.
Section 7.2 Illegality. If any applicable law, rule or regulation, or any
change therein or adoption thereof, or interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Lender (or
its LIBOR Lending Office) with any request or directive (whether or not having
the force of law) of any such authority, central bank or comparable agency,
shall make it unlawful or impossible for such Lender (or its LIBOR Lending
Office) to make, maintain or fund its LIBOR Advances, such Lender shall so
notify the Borrower and the Administrative Lender. Before giving any notice to
the Borrower pursuant to this Section, the notifying Lender shall designate a
different LIBOR Lending Office or other lending office if such designation will
avoid the need for giving such notice and will not, in the sole judgment of the
Lender, be materially disadvantageous to the Lender. Upon receipt of such
notice, notwithstanding anything contained in Article 2 hereof, the Borrower
shall repay in full the then outstanding principal amount of each LIBOR Advance
owing to the notifying Lender, together with accrued interest thereon, on either
(a) the last day of the Interest Period applicable to such Advance, if the
Lender may lawfully continue to maintain and fund such Advance to such day, or
(b) immediately, if the Lender may not lawfully continue to fund and maintain
such Advance to such day. Concurrently with repaying each affected LIBOR Advance
owing to such Lender, notwithstanding anything contained in Article 2 hereof,
the Borrower shall borrow a Base Rate Advance from such Lender, and such Lender
shall make such Base Rate Advance, in an amount such that the outstanding
principal amount of the Advances owing to such Lender shall equal the
outstanding principal amount of the Advances owing immediately prior to such
repayment.
Section 7.3 Increased Costs.
(a) If any applicable law, rule or regulation, or any change in or adoption
of any law, rule or regulation, or any interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof or compliance by any Lender (or its
LIBOR Lending Office) with any request or directive (whether or not having the
force of law) of any such authority, central bank or compatible agency:
(i) shall subject a Lender (or its LIBOR Lending Office) to any Tax
(net of any
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tax benefit engendered thereby) with respect to its LIBOR Advances or its
obligation to make such Advances, or shall change the basis of taxation of
payments to a Lender (or to its LIBOR Lending Office) of the principal of
or interest on its LIBOR Advances or in respect of any other amounts due
under this Agreement, as the case may be, or its obligation to make such
Advances (except for changes in the rate of tax on the overall net income,
net worth or capital of the Lender and franchise taxes, doing business
taxes or minimum taxes imposed upon such Lender); or
(ii) shall impose, modify or deem applicable any reserve (including,
without limitation, any imposed by the Board of Governors of the Federal
Reserve System), special deposit or similar requirement against assets of,
deposits with or for the account of, or credit extended by, a Lender's
LIBOR Lending Office or shall impose on the Lender (or its LIBOR Lending
Office) or on the United States market for certificates of deposit or the
London interbank market any other condition affecting its LIBOR Advances or
its obligation to make such Advances (but excluding any reserves or
deposits that are included in the calculation of LIBOR Basis);
and the result of any of the foregoing is to increase the cost to a Lender (or
its LIBOR Lending Office) of making or maintaining any LIBOR Advances, or to
reduce the amount of any sum received or receivable by a Lender (or its LIBOR
Lending Office) with respect thereto, by an amount deemed by a Lender to be
material ("Increased Advance Costs"), then, within 15 days after demand by a
Lender, the Borrower agrees to pay to such Lender such additional amount as will
compensate such Lender for such increased costs or reduced amounts, subject to
Section 9.9 hereof. The affected Lender will as soon as practicable notify the
Borrower of any event of which it has knowledge, occurring after the date
hereof, which will entitle such Lender to compensation pursuant to this Section
and will designate a different LIBOR Lending Office or other lending office if
such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the sole judgment of the affected Lender made in
good faith, be materially disadvantageous to such Lender. Notwithstanding the
foregoing, any Lender's demand for Increased Advance Costs shall not include any
Increased Advance Costs with respect to any period more than 180 days prior to
the date that such Lender gives notice to the Borrower of such Increased Advance
Costs unless the effective date of the condition which results in the right to
receive Increased Advance Costs is retroactive (the "Increased Advance Costs
Retroactive Effective Date"). If any Increased Advance Costs has an Increased
Advance Costs Retroactive Effective Date and any Lender demands compensation
within 180 days after the date setting the Increased Advance Costs Retroactive
Effective Date (the "Increased Advance Costs Set Date"), such Lender shall have
the right to receive such Increased Advance Costs from the Increased Advance
Costs Retroactive Effective Date. If a Lender does not demand such Increased
Advance Costs within 180 days after the Increased Advance Costs Set Date, such
Lender may not receive payment of Increased Advance Costs with respect to any
period more than 180 days prior to such demand.
(b) A certificate of any Lender claiming compensation under this Section
and setting forth the additional amounts to be paid to it hereunder and
calculations therefor shall be conclusive in the absence of manifest error. In
determining such amount, a Lender may use any reasonable
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averaging and attribution methods. If a Lender demands compensation under this
Section, the Borrower may at any time, upon at least five Business Days' prior
notice to the Lender, after reimbursement to the Lender by the Borrower in
accordance with this Section of all costs incurred, prepay in full the then
outstanding LIBOR Advances of the Lender, together with accrued interest thereon
to the date of prepayment, along with any reimbursement required under Section
2.9 hereof. Concurrently with prepaying such LIBOR Advances, the Borrower shall
borrow a Base Rate Advance from the Lender, and the Lender shall make such Base
Rate Advance, in an amount such that the outstanding principal amount of the
Advances owing to such Lender shall equal the outstanding principal amount of
the Advances owing immediately prior to such prepayment.
Section 7.4 Effect On Base Rate Advances. If notice has been given pursuant
to Section 7.1, 7.2 or 7.3 hereof suspending the obligation of a Lender to make
LIBOR Advances, or requiring LIBOR Advances of a Lender to be repaid or prepaid,
then, unless and until the Lender notifies the Borrower that the circumstances
giving rise to such repayment no longer apply, all Advances which would
otherwise be made by such Lender as LIBOR Advances shall be made instead as Base
Rate Advances.
Section 7.5 Capital Adequacy. If either (a) the introduction of or any
change in or in the interpretation of any law, rule or regulation or (b)
compliance by a Lender with any law, rule or regulation or any guideline or
request from any central bank or other governmental authority (whether or not
having the force of law) affects or would affect the amount of capital required
or expected to be maintained by a Lender or any corporation controlling such
Lender, and such Lender determines that the amount of such capital is increased
by or based upon the existence of such Lender's Commitment or Advances hereunder
and other commitments or advances of such Lender of this type, then, upon demand
by such Lender, subject to Section 9.9, the Borrower shall immediately pay to
such Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender with respect to such circumstances
(collectively, "Additional Costs"), to the extent that such Lender reasonably
determines in good faith such increase in capital to be allocable to the
existence of such Lender's Commitment hereunder. Notwithstanding the foregoing,
any Lender's demand for Additional Costs shall not include any Additional Costs
with respect to any period more than 180 days prior to the date that such Lender
gives notice to the Borrower of such Additional Costs unless the effective date
of the Regulatory Modification which results in the right to receive Additional
Costs is retroactive (the "Regulatory Modification Retroactive Effective Date").
If any Regulatory Modification has a Regulatory Modification Retroactive
Effective Date and any Lender demands compensation within 180 days after the
date setting the Regulatory Modification Retroactive Effective Date (the
"Regulatory Modification Set Date"), such Lender shall have the right to receive
such Additional Costs from the Regulatory Modification Retroactive Effective
Date. If a Lender does not demand such Additional Costs within 180 days after
the Regulatory Modification Set Date, such Lender may not receive payment of
Additional Costs with respect to any period more than 180 days prior to such
demand. A certificate as to such amounts submitted to the Borrower by a Lender
hereunder, shall, in the absence of manifest error, be conclusive and binding
for all purposes.
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ARTICLE 8
AGREEMENT AMONG LENDERS
Section 8.1 Agreement Among Lenders. The Lenders agree among themselves
that:
(a) Administrative Lender. Each Lender hereby appoints the Administrative
Lender as its nominee in its name and on its behalf, to receive all documents
and items to be furnished hereunder; to act as nominee for and on behalf of all
Lenders under the Loan Papers; to, except as otherwise expressly set forth
herein, take such action as may be requested by the Determining Lenders,
provided that, unless and until the Administrative Lender shall have received
such requests, the Administrative Lender may take such administrative action, or
refrain from taking such administrative action, as it may deem advisable and in
the best interests of the Lenders; to arrange the means whereby the proceeds of
the Advances of the Lenders are to be made available to the Borrower; to
distribute promptly to each Lender information, requests and documents received
from the Borrower, and each payment (in like funds received) with respect to any
of such Lender's Advances, fee or other amount; and to deliver to the Borrower
requests, notices, demands, approvals and consents received from the Lenders.
The Administrative Lender agrees to promptly distribute to each Lender, at such
Lender's address set forth below information, requests, documents and payments
received from the Borrower. The Administrative Lender shall have no duties or
responsibilities except those expressly set forth in this Agreement. The duties
of the Administrative Lender are mechanical and administrative in nature and the
Administrative Lender shall have no fiduciary relationship in respect of any
Lender by reason of this Agreement or any other Loan Paper.
(b) Replacement of Administrative Lender. Should the Administrative Lender
or any successor Administrative Lender ever cease to be a Lender hereunder, or
should the Administrative Lender or any successor Administrative Lender ever
resign as Administrative Lender, or should the Administrative Lender or any
successor Administrative Lender ever be removed with cause by the Determining
Lenders, then the Lender appointed by the Determining Lenders shall forthwith
become the Administrative Lender, and the Borrower and the Lenders shall execute
such documents as any Lender may reasonably request to reflect such change. If
the Administrative Lender also then serves in the capacity of the Swing Line
Bank or the Issuing Bank, such resignation or removal shall constitute
resignation or removal of the Swing Line Bank and the Issuing Bank. Any
resignation or removal of the Administrative Lender or any successor
Administrative Lender shall become effective upon the appointment by the
Determining Lenders of a successor Administrative Lender; provided, however,
that if the Lenders fail for any reason to appoint a successor within 60 days
after such removal or resignation, the Administrative Lender or any successor
Administrative Lender (as the case may be) shall thereafter have no obligation
to act as Administrative Lender hereunder.
(c) Expenses. Each Lender shall pay its pro rata share, based on its
Specified Percentage, of any expenses paid by the Administrative Lender directly
and solely in connection with any of the Loan Papers if Administrative Lender
does not receive reimbursement therefor
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from other sources within 60 days after the date incurred, unless payment of
such fees is being diligently disputed by such Lender or the Borrower in good
faith. Any amount so paid by the Lenders to the Administrative Lender shall be
returned by the Administrative Lender pro rata to each paying Lender to the
extent later paid by the Borrower or any other Person on the Borrower's behalf
to the Administrative Lender.
(d) Delegation of Duties. The Administrative Lender may execute any of its
duties hereunder by or through officers, directors, employees, attorneys or
agents, and shall be entitled to (and shall be protected in relying upon) advice
of counsel concerning all matters pertaining to its duties hereunder.
(e) Reliance by Administrative Lender. The Administrative Lender and its
officers, directors, employees, attorneys and agents shall be entitled to rely
and shall be fully protected in relying on any writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telex or teletype
message, statement, order, or other document or conversation reasonably believed
by it or them in good faith to be genuine and correct and to have been signed or
made by the proper Person and, with respect to legal matters, upon opinions of
counsel selected the Administrative Lender. The Administrative Lender may, in
its reasonable judgment, deem and treat the payee of any Note as the owner
thereof for all purposes hereof.
(f) Limitation of Administrative Lender's Liability. Neither the
Administrative Lender nor any of its officers, directors, employees, attorneys
or agents shall be liable for any action taken or omitted to be taken by it or
them hereunder in good faith and believed by it or them to be within the
discretion or power conferred to it or them by the Loan Papers or be responsible
for the consequences of any error of judgment, except for its or their own gross
negligence or wilful misconduct. Except as aforesaid, the Administrative Lender
shall be under no duty to enforce any rights with respect to any of the
Advances, or any security therefor. After the occurrence of a Default or an
Event of Default, the Administrative Lender shall not be compelled to do any act
hereunder or to take any action towards the execution or enforcement of the
powers hereby created or to prosecute or defend any suit in respect hereof,
unless indemnified to its satisfaction against loss, cost, liability and
expense. The Administrative Lender shall not be responsible in any manner to any
Lender for the effectiveness, enforceability, genuineness, validity or due
execution of any of the Loan Papers, or for any representation, warranty,
document, certificate, report or statement made herein or furnished in
connection with any Loan Papers, or be under any obligation to any Lender to
ascertain or to inquire as to the performance or observation of any of the
terms, covenants or conditions of any Loan Papers on the part of the Borrower.
To the extent not reimbursed by the Borrower, each Lender hereby severally
indemnifies and holds harmless the Administrative Lender, pro rata according to
its Specified Percentage, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses and/or
disbursements of any kind or nature whatsoever which may be imposed on, asserted
against, or incurred by the Administrative Lender in any way with respect to any
Loan Papers or any action taken or omitted by the Administrative Lender under
the Loan Papers (including any negligent action of the Administrative Lender),
except to the extent the same result from gross negligence or wilful misconduct
by the Administrative Lender.
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(g) Liability Among Lenders. No Lender shall incur any liability (other
than the sharing of expenses and other matters specifically set forth herein and
in the other Loan Papers) to any other Lender, except for acts or omissions in
bad faith or which are the result of gross negligence or wilful misconduct.
(h) Rights as Lender. With respect to its commitment hereunder, the
Advances made by it and Note issued to it, the Administrative Lender shall have
the same rights as a Lender and may exercise the same as though it were not the
Administrative Lender, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Administrative Lender in its individual
capacity. The Administrative Lender or any Lender may accept deposits from, act
as trustee under indentures of, and generally engage in any kind of business
with, the Borrower and any of its Affiliates, and any Person who may do business
with or own securities of the Borrower or any of its Affiliates, all as if the
Administrative Lender were not the Administrative Lender hereunder and without
any duty to account therefor to the Lenders.
Section 8.2 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Lender or any other
Lender and based upon the financial statements delivered to such Lender by the
Borrower, and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon
the Administrative Lender or any other Lender and based upon 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 this Agreement and the
other Loan Papers.
Section 8.3 Benefits of Article. None of the provisions of this Article
shall inure to the benefit of any Person other than Lenders; consequently, no
Person shall be entitled to rely upon, or to raise as a defense, in any manner
whatsoever, the failure of the Administrative Lender or any Lender to comply
with such provisions.
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ARTICLE 9
Miscellaneous
Section 9.1 Notices.
(a) All notices and other communications under this Agreement shall be in
writing and shall be deemed to have been given on the date personally delivered
or sent by telecopy (answerback received), or three days after deposit in the
mail, designated as certified mail, return receipt requested, postage-prepaid,
or one day after being entrusted to a reputable commercial overnight delivery
service, or one day after being delivered to the telegraph office or sent out by
telex addressed to the party to which such notice is directed at its address
determined as provided in this Section. All notices and other communications
under this Agreement shall be given to the parties hereto at the following
addresses:
(i) If to the Borrower, at:
La Quinta Inns, Inc.
112 E. Pecan Street, Suite 1200
San Antonio, Texas 78205
Attn: William S. McCalmont
Senior Vice President-Chief Financial Officer
(ii) If to the Administrative Lender, at:
NationsBank of Texas, N.A.
901 Main Street, 67th Floor
Dallas, Texas 75202
Attn: Suzanne Smith
Vice President
(iii) If to a Lender, at its address shown below its name on the
signature pages hereof, or if applicable, set forth in its
Assignment Agreement.
(b) Any party hereto may change the address to which notices shall be
directed by giving 10 days' written notice of such change to the other parties.
Section 9.2 Expenses. The Borrower shall promptly pay:
(a) all reasonable out-of-pocket expenses of the Administrative Lender in
connection with the preparation, negotiation, execution and delivery of this
Agreement and the other Loan Papers, the transactions contemplated hereunder and
thereunder, and the making of Advances hereunder, including without limitation
the reasonable fees and disbursements of Special Counsel;
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(b) all reasonable out-of-pocket expenses and attorneys' fees of the
Administrative Lender in connection with the administration of the transactions
contemplated in this Agreement and the other Loan Papers and the preparation,
negotiation, execution and delivery of any waiver, amendment or consent by the
Lenders relating to this Agreement or the other Loan Papers; and
(c) all costs, out-of-pocket expenses and attorneys' fees of the
Administrative Lender and each Lender incurred for enforcement, collection,
restructuring, refinancing and "work-out", or otherwise incurred in obtaining
performance under the Loan Papers, and all costs and out-of-pocket expenses of
collection if default is made in the payment of the Notes, which in each case
shall include without limitation fees and expenses of consultants, counsel for
the Administrative Lender and any Lender, and administrative fees for the
Administrative Lender.
Section 9.3 Waivers. The rights and remedies of the Lenders under this
Agreement and the other Loan Papers shall be cumulative and not exclusive of any
rights or remedies which they would otherwise have. No failure or delay by the
Administrative Lender or any Lender in exercising any right shall operate as a
waiver of such right. The Lenders expressly reserve the right to require strict
compliance with the terms of this Agreement in connection with any funding of a
request for an Advance. In the event that any Lender decides to fund an Advance
at a time when the Borrower is not in strict compliance with the terms of this
Agreement, such decision by such Lender shall not be deemed to constitute an
undertaking by the Lender to fund any further requests for Advances or preclude
the Lenders from exercising any rights available under the Loan Papers or at law
or equity. Any waiver or indulgence granted by the Lenders shall not constitute
a modification of this Agreement, except to the extent expressly provided in
such waiver or indulgence, or constitute a course of dealing by the Lenders at
variance with the terms of the Agreement such as to require further notice by
the Lenders of the Lenders' intent to require strict adherence to the terms of
the Agreement in the future. Any such actions shall not in any way affect the
ability of the Administrative Lender or the Lenders, in their discretion, to
exercise any rights available to them under this Agreement or under any other
agreement, whether or not the Administrative Lender or any of the Lenders are a
party thereto, relating to the Borrower.
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Section 9.4 Determination by the Lenders Conclusive and Binding. Any
material determination required or expressly permitted to be made by the
Administrative Lender or any Lender under this Agreement shall be made in good
faith, and shall when made, absent manifest error, be conclusive and binding on
all parties.
Section 9.5 Set-Off. In addition to any rights now or hereafter granted
under Applicable Law and not by way of limitation of any such rights, upon the
occurrence of an Event of Default, each Lender and any subsequent holder of any
Note, and any assignee or participant in any Note is hereby authorized by the
Borrower at any time or from time to time, without notice to the Borrower or any
other Person, any such notice being hereby expressly waived, to set-off,
appropriate and apply any deposits (general or special (except trust and escrow
accounts), time or demand, including without limitation Debt evidenced by
certificates of deposit, in each case whether matured or unmatured) and any
other Debt at any time held or owing by such Lender or holder to or for the
credit or the account of the Borrower, against and on account of the Obligations
and other liabilities of the Borrower to such Lender or holder, irrespective of
whether or not (a) the Lender or holder shall have made any demand hereunder, or
(b) the Administrative Lender or holder shall have declared the principal of and
interest on the Advances and other amounts due hereunder to be due and payable
as permitted by Section 6.2 and although such obligations and liabilities, or
any of them, shall be contingent or unmatured. Any sums obtained by any Lender
or by any assignee, participant or subsequent holder of any Note shall be
subject to pro rata treatment of all Obligations and other liabilities
hereunder.
Section 9.6 Assignment.
(a) The Borrower may not assign or transfer any of its rights or
obligations hereunder or under the other Loan Papers without the prior written
consent of the Lenders.
(b) No Lender shall be entitled to assign its interest in this Agreement,
its Notes or its Advances, except as hereinafter set forth.
(c) With the prior written consent of the Borrower (which consent may be
withheld for any reason or for no reason), a Lender may at any time sell
participations in all or any part of its Advances, its portion of the
Commitment, and all other interests of such Lender under this Agreement and the
other Loan Papers, (collectively, "Participations") to any banks or other
financial institutions ("Participants") provided that such Participation shall
not confer on any Person (other than the parties hereto) any right to vote on,
approve or sign amendments or waivers, or any other independent benefit or any
legal or equitable right, remedy or other claim under this Agreement or any
other Loan Papers, other than the right to vote on, approve, or sign amendments
or waivers or consents with respect to items that would result in (i) any
increase in the commitment of any Participant; or (ii)(A) the extension of the
date of maturity of, or (B) the extension of the due date for any payment of
principal, interest or fees respecting, or (C) the reduction of the amount of
any installment of principal or interest on or the change or reduction of any
mandatory reduction required hereunder, or (D) a reduction of the rate of
interest on, the Advances, or change
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in Applicable Margin; or (iii) the release of security for the Obligations
having a value in excess of a Material Amount, including without limitation any
guarantee; or (iv) the reduction of any fees payable hereunder. Notwithstanding
the foregoing, the Borrower agrees that the Participants shall be entitled to
the benefits of Article 7 and Section 9.5 hereof as though they were Lenders and
the Lenders may provide copies of all financial information received from the
Borrower to such Participants. To the fullest extent it may effectively do so
under Applicable Law, the Borrower agrees that any Participant may exercise any
and all rights of banker's lien, set-off and counterclaim with respect to this
Participation as fully as if such Participant were the holder of the Advances in
the amount of its Participation. Notwithstanding anything in this Section 9.6(c)
to the contrary, a Lender may sell Participations to its affiliates without the
prior written consent of the Borrower.
(d) Each Lender may assign to one or more financial institutions or funds
organized under the laws of the United States, or any state thereof, or under
the laws of any other country that is a member of the Organization for Economic
Cooperation and Development, or a political subdivision of any such country,
which is engaged in making, purchasing or otherwise investing in commercial
loans in the ordinary course of its business (each, an "Assignee") its rights
and obligations under this Agreement and the other Loan Papers; provided,
however, that (i) except as otherwise provided herein, each such assignment
shall be subject to the prior written consent of the Administrative Lender and
the Borrower (which consent shall not be unreasonably withheld), (ii) each such
assignment shall be of a constant, and not a varying, percentage of the Lender's
rights and obligations under this Agreement, (iii) the amount of the Commitment
and Advances being assigned pursuant to each such assignment (determined as of
the date of the assignment with respect to such assignment) shall in no event be
less than $10,000,000, (iv) the applicable Lender, Administrative Lender and
applicable Assignee shall execute and deliver to the Administrative Lender an
Assignment and Acceptance Agreement (an "Assignment Agreement") in substantially
the form of Exhibit C hereto, together with the Notes subject to such
assignment, and (v) the Assignee or the Lender executing the Assignment
Agreement as the case may be, shall deliver to the Administrative Lender a
processing fee of $3,500. Upon such execution, delivery and acceptance from and
after the effective date specified in each Assignment Agreement, which effective
date shall be at least three Business Days after the execution thereof, (A) the
Assignee thereunder shall be party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment
Agreement, have the rights and obligations of a Lender hereunder and (B) the
assigning Lender shall, to the extent that rights and obligations hereunder have
been assigned by it pursuant to such Assignment Agreement, relinquish such
rights and be released from such obligations under this Agreement.
Notwithstanding anything in this clause (d) to the contrary, any Lender may
assign its rights and obligations under this Agreement to an affiliate of such
Lender without the prior written consent of the Administrative Lender and the
Borrower, but otherwise subject to the restrictions set forth herein.
(e) Notwithstanding anything in clause (d) above to the contrary, any
Lender may assign and pledge all or any portion of its Advances and Notes to any
Federal Reserve Bank as collateral security pursuant to Regulation A of F.R.S.
Board and any Operating Circular issued by such Federal Reserve Bank; provided,
however, that no such assignment under this clause (e) shall release the
assignor Lender from its obligations hereunder.
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(f) Upon its receipt of an Assignment Agreement executed by a Lender and an
Assignee, and any Note subject to such assignment, the Borrower shall, within
three Business Days after its receipt of such Assignment Agreement, at its own
expense, execute and deliver to the Administrative Lender in exchange for the
surrendered Note a new Note to the order of such Assignee in an amount equal to
the portion of the Advances and Commitment assigned to it pursuant to such
Assignment Agreement and a new Note to the order of the assigning Lender in an
amount equal to the portion of the Advances and Commitment retained by it
hereunder. Such new Notes shall be in an aggregate principal amount equal to the
aggregate principal amount of such surrendered Note, shall be dated the
effective date of such Assignment Agreement and shall otherwise be in
substantially the form of Exhibit A hereto.
(g) Any Lender may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section 9.6, disclose to
the assignee or Participant or proposed assignee or participant, any information
relating to the Borrower furnished to such Lender by or on behalf of the
Borrower.
(h) Except as specifically set forth in this Section 9.6, nothing in this
Agreement or any other Loan Papers, expressed or implied, is intended to or
shall confer on any Person other than the respective parties hereto and thereto
and their successors and assignees permitted hereunder and thereunder any
benefit or any legal or equitable right, remedy or other claim under this
Agreement or any other Loan Papers.
(i) Notwithstanding anything in this Section 9.6 to the contrary, no
Assignee or Participant shall be entitled to receive any greater payment under
Section 2.15 or Section 7.3 than such assigning or participating Lender would
have been entitled to receive with respect to the interest assigned or
participated to such Assignee or Participant.
Section 9.7 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
Section 9.8 Severability. Any provision of this Agreement which is for any
reason prohibited or found or held invalid or unenforceable by any court or
governmental agency shall be ineffective to the extent of such prohibition or
invalidity or unenforceability without invalidating the remaining provisions
hereof in such jurisdiction or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 9.9 Interest and Charges. It is not the intention of any parties to
this Agreement to make an agreement in violation of the laws of any applicable
jurisdiction relating to usury. Regardless of any provision in any Loan Papers,
no Lender shall ever be entitled to receive, collect or apply, as interest on
the Obligations, any amount in excess of the Maximum Amount. If any Lender or
participant ever receives, collects or applies, as interest, any such excess,
such amount which would be excessive interest shall be deemed a partial
repayment of principal and treated
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hereunder as such; and if principal is paid in full, any remaining excess shall
be paid to the Borrower. In determining whether or not the interest paid or
payable, under any specific contingency, exceeds the Maximum Amount, the
Borrower and the Lenders shall, to the maximum extent permitted under Applicable
Law, (a) characterize any nonprincipal payment as an expense, fee or premium
rather than as interest, (b) exclude voluntary prepayments and the effect
thereof, and (c) amortize, prorate, allocate and spread in equal parts, the
total amount of interest throughout the entire contemplated term of the
Obligations so that the interest rate is uniform throughout the entire term of
the Obligations; provided, however, that if the Obligations are 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, the Lenders shall refund to the Borrower the amount of such
excess or credit the amount of such excess against the total principal amount of
the Obligations owing, and, in such event, the Lenders shall not be subject to
any penalties provided by any laws for contracting for, charging or receiving
interest in excess of the Maximum Amount. This Section shall control every other
provision of all agreements pertaining to the transactions contemplated by or
contained in the Loan Papers.
Section 9.10 Confidentiality. Each Lender and the Administrative Lender
agrees (on behalf of itself and each of its affiliates, directors, officers,
employees and representatives) to use reasonable precautions to keep
confidential, in accordance with customary procedures for handling confidential
information of this nature and in accordance with safe and sound banking
practices, any non-public information supplied to it by the Borrower pursuant to
this Agreement which is identified by the Borrower as being confidential at the
time the same is delivered to the Lenders or the Administrative Lender, provided
that nothing herein shall limit the disclosure of any such information (a) to
the extent required by statute, rule, regulation or judicial process, (b) to
counsel for any Lender or the Administrative Lender, (c) to bank examiners,
auditors or accountants of any Lender, (d) to the Administrative Lender or any
other Lender, (e) in connection with any litigation to which any one or more of
Lenders is a party, provided, further, that, unless specifically prohibited by
Applicable Law or court order, each Lender shall, prior to disclosure thereof,
notify the Borrower of any request for disclosure of any such non-public
information (i) by any governmental agency or representative thereof (other than
any such request in connection with an examination of such Lender's financial
condition by such governmental agency) or (ii) pursuant to legal process, or (f)
to any assignee or participant (or prospective assignee or participant) so long
as such assignee or participant (or prospective assignee or participant) first
executes and delivers to the respective Lender an agreement (a "Confidentiality
Agreement") in substantially the form of Exhibit D hereto; and provided finally
that in no event shall any Lender or the Administrative Lender be obligated or
required to return any materials furnished by the Borrower.
Section 9.11 Headings. Headings used in this Agreement are for convenience
only and shall not be used in connection with the interpretation of any
provision hereof.
Section 9.12 Amendment and Waiver. The provisions of this Agreement may not
be amended, modified or waived except by the written agreement of the Borrower
and the Determining Lenders; provided, however, that no such amendment,
modification or waiver shall be made (a) without the consent of all Lenders, if
it would (i) increase the Specified Percentage or
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commitment of any Lender, or (ii) extend the date of maturity of, extend the due
date for any payment of principal or interest on, reduce the amount of any
installment of principal or interest on, or reduce the rate of interest on, any
Advance, the Reimbursement Obligations or other amount owing under any Loan
Papers, or (iii) release any security for or guaranty of the Obligations (except
pursuant to this Agreement), or (iv) reduce the fees payable hereunder, or (v)
revise this Section 9.12, or (vi) waive the date for payment of any of the
Obligations, or (vii) amend the definition of Determining Lenders; or (b)
without the consent of the Administrative Lender, if it would alter the rights,
duties or obligations of the Administrative Lender. Neither this Agreement nor
any term hereof may be amended orally, nor may any provision hereof be waived
orally but only by an instrument in writing signed by the Administrative Lender
and, in the case of an amendment, by the Borrower.
Section 9.13 Exception to Covenants. Neither the Borrower nor any
Subsidiary shall be deemed to be permitted to take any action or fail to take
any action which is permitted as an exception to any of the covenants contained
herein or which is within the permissible limits of any of the covenants
contained herein if such action or omission would result in the breach of any
other covenant contained herein.
SECTION 9.14 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN PAPERS SHALL
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS;
PROVIDED, HOWEVER, THAT PURSUANT TO ARTICLE 5069-15.10(b), TITLE 79, REVISED
CIVIL STATUTES OF TEXAS, 1925, AS AMENDED, IT IS AGREED THAT THE PROVISIONS OF
CHAPTER 15, TITLE 79, REVISED CIVIL STATUTES OF TEXAS, 1925, AS AMENDED, SHALL
NOT APPLY TO THE ADVANCES, THIS AGREEMENT AND THE OTHER LOAN PAPERS. WITHOUT
EXCLUDING ANY OTHER JURISDICTION, THE BORROWER AGREES THAT THE STATE AND FEDERAL
COURTS OF TEXAS LOCATED IN DALLAS, TEXAS SHALL HAVE JURISDICTION OVER
PROCEEDINGS IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN PAPERS.
SECTION 9.15 WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE ADMINISTRATIVE
LENDER AND THE LENDERS HEREBY KNOWINGLY VOLUNTARILY, IRREVOCABLY AND
INTENTIONALLY WAIVE, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ALL RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR CLAIM ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR ANY OF THE OTHER LOAN PAPERS OR THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY. THIS PROVISION IS A MATERIAL INDUCEMENT TO EACH LENDER
ENTERING INTO THIS AGREEMENT AND MAKING ANY ADVANCES HEREUNDER.
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SECTION 9.16 ENTIRE AGREEMENT. THIS WRITTEN AGREEMENT, TOGETHER WITH THE
OTHER LOAN PAPERS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.
================================================================================
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
================================================================================
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IN WITNESS WHEREOF, this Credit Agreement is executed as of the date first
set forth above.
BORROWER: LA QUINTA INNS, INC.
By:
------------------------------
William S. McCalmont
Senior Vice President-Chief
Financial Office
ADMINISTRATIVE LENDER: NATIONSBANK OF TEXAS, N.A.,
as Administrative Lender
By:
-------------------------------
Suzanne Smith
Vice President
LENDERS: NATIONSBANK OF TEXAS, N.A., as a Lender
Specified Percentage:
100%
By:
-------------------------------
Suzanne Smith
Vice President
901 Main Street, 67th Floor
Dallas, Texas 75202
Attn: Suzanne Smith
Vice President
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SCHEDULE 1
LIBOR LENDING OFFICES
NATIONSBANK OF TEXAS, N.A.
901 Main Street, 67th Floor
Dallas, Texas 75202
EXHIBIT A
REVOLVING CREDIT NOTE
Dallas, Texas $_____________ November 17, 1997
LA QUINTA INNS, INC., a Texas corporation (the "Borrower"), for value
received, promises to pay to the order of _______________ ("Lender"), at the
principal office of _____________________, in lawful money of the United States
of America, the principal sum of ________________ DOLLARS ($______), or such
lesser sum as shall be due and payable from time to time hereunder, as
hereinafter provided. All terms used but not defined herein shall have the
meanings set forth in the Credit Agreement described below.
The Borrower promises to pay principal of and interest on the unpaid
principal balance of Revolving Credit Advances under this Revolving Credit Note
from time to time outstanding as set forth in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to NationsBank of Texas, N.A., as Administrative Lender for
the Lenders, at 901 Main Street, Dallas, Texas 75202, in immediately available
funds.
This Revolving Credit Note is issued pursuant to and evidences Revolving
Credit Advances under the Credit Agreement, dated as of November 17, 1997, among
the Borrower, NationsBank of Texas, N.A., as Administrative Lender, and the
lenders parties thereto (as amended, restated, supplemented, renewed, extended
or otherwise modified from time to time, "Credit Agreement"), to which reference
is made for a statement of the rights and obligations of the Lender and the
duties and obligations of the Borrower in relation thereto; but neither this
reference to the Credit Agreement nor any provision thereof shall affect or
impair the absolute and unconditional obligation of the Borrower to pay the
principal sum of and interest on this Revolving Credit Note when due.
The Borrower and all endorsers, sureties and guarantors of this Revolving
Credit Note hereby severally waive demand, presentment for payment, protest,
notice of protest, notice of acceleration, notice of intention to accelerate the
maturity of this Revolving Credit Note, and all other notices of any kind,
diligence in collecting, the bringing of any suit against any party and any
notice of or defense on account of any extensions, renewals, partial payments or
changes in any manner of or in this Revolving Credit Note or in any of its
terms, provisions and covenants, or any releases or substitutions of any
security, or any delay, indulgence or other act of any trustee or any holder
hereof, whether before or after maturity.
THIS REVOLVING CREDIT NOTE, TOGETHER WITH THE OTHER LOAN PAPERS, REPRESENTS
THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES HERETO.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
LA QUINTA INNS, INC.
By:
-------------------------------
William S. McCalmont
Senior Vice President-Chief
Financial Officer
-2-
EXHIBIT B
GUARANTY
This Guaranty, dated as of November 17, 1997 (this "Guaranty"), is made by
the entities listed on the signature pages hereof (all such entities being
collectively called the "Guarantors").
BACKGROUND.
1. La Quinta Inns, Inc., a Texas corporation ("Company"), NationsBank of
Texas, N.A., as Administrative Lender ("Administrative Lender") on behalf of
NationsBank of Texas, N.A. and each other lender, and each other lender (singly,
a "Lender" and collectively, the "Lenders") have entered into the Credit
Agreement, dated as of November 17, 1997 (as hereafter amended or otherwise
modified from time to time, the "Credit Agreement"). The capitalized terms not
otherwise defined herein have the meanings specified in the Credit Agreement.
2. Pursuant to the Credit Agreement, Company may, subject to the terms of
the Credit Agreement and the other Loan Papers, request that Lenders make
Advances.
3. It is a condition precedent to the obligation of Lenders to make such
Advances that Guarantors guarantee repayment thereof upon the terms and
conditions set forth herein.
4. In the case of each Guarantor which is a corporation, the Board of
Directors of each such Guarantor, and in the case of each Guarantor which is a
partnership or joint venture, the Board of Directors of each corporation which
is a partner or a joint venturer of such Guarantor, have determined that the
execution, delivery, and performance of this Guaranty is necessary and
convenient to the conduct, promotion, and attainment of such Guarantor's
business and that such Guaranty may reasonably be expected to benefit, directly
or indirectly, such Guarantor.
5. Guarantors desire to induce Lender to make such Advances.
AGREEMENT.
Now, therefore, in consideration of the premises and in order to induce
Lenders to make Advances and issue, or participate in the issuance of, Letters
of Credit under the Credit Agreement, Guarantors agree as follows:
1. Guaranty.
(a) Each Guarantor, jointly and severally, hereby unconditionally and
irrevocably guarantees the punctual payment of, and promises to pay, when
due, whether at stated maturity, by mandatory prepayment, by acceleration
or otherwise, all obligations, indebtedness and liabilities, and all
rearrangements, renewals and extensions of all or any part thereof, of
Company or any other Obligor now or hereafter arising from, by virtue of or
pursuant to the Credit Agreement, the Notes, any other Loan Paper, and any
and all renewals and extensions thereof, or any part thereof, or future
amendments thereto, whether for principal, interest (including, without
limitation, interest, fees and other charges that would accrue or become
owing both prior to and subsequent to and but for the commencement of any
proceeding against or with respect to Company or any other Obligor under
any chapter of the Bankruptcy Code of 1978, 11 U.S.C. ss.101 et seq.
whether or not a claim is allowed for the same in any such proceeding),
premium, fees, commissions, expenses or otherwise (such obligations being
the "Obligation"), and agrees to pay any and all reasonable expenses
(including reasonable counsel fees and expenses) incurred in enforcement or
collection of all or any part thereof, whether such obligations,
indebtedness and liabilities are direct, indirect, fixed, contingent,
joint, several or joint and several, and any rights under this Guaranty.
(b) Anything contained in this Guaranty to the contrary
notwithstanding, the obligations of each Guarantor hereunder shall be
limited to a maximum aggregate amount equal to the largest amount that
would not render its obligations hereunder subject to avoidance as a
fraudulent transfer or conveyance under Section 548 of Title 11 of the
United States Code or any applicable provisions of comparable state law
(collectively, the "Fraudulent Transfer Laws"), in each case after giving
effect to all other liabilities of Guarantor, contingent or otherwise, that
are relevant under the Fraudulent Transfer Laws (specifically excluding,
however, any liabilities of such Guarantor in respect of intercompany
indebtedness to Company, other Affiliates of Company or other Obligors to
the extent that such indebtedness would be discharged in an amount equal to
the amount paid by such Guarantor hereunder) and after giving effect as
assets, subject to Paragraph 4(a) hereof, to the value (as determined under
the applicable provisions of Fraudulent Transfer Laws) of any rights to
subrogation or contribution of such Guarantor pursuant to (i) Applicable
Law or (ii) any agreement providing for an equitable allocation among such
Guarantor and other Obligors of obligations arising under guaranties by
such parties.
2. Guaranty Absolute. Each Guarantor guarantees that the Obligation will be
paid strictly in accordance with the terms of the Credit Agreement, the Notes,
and the other Loan Papers, regardless of any Applicable Law, regulation or order
now or hereafter in effect in any jurisdiction affecting any of such terms or
the rights of Administrative Lender or any Lender with respect thereto;
provided, however, nothing contained in this Guaranty shall require any
Guarantor to make any payment under this Guaranty in violation of any Applicable
Law, regulation or order now or hereafter in effect. The obligations and
liabilities of each Guarantor hereunder are
-2-
independent of the obligations of Company under the Credit Agreement and of the
obligations of each other Obligor under each other Loan Paper and any Applicable
Law. The liability of each Guarantor under this Guaranty shall be absolute and
unconditional irrespective of:
(a) the taking or accepting of any other security or guaranty for any
or all of the Obligation;
(b) any increase, reduction or payment in full at any time or from
time to time of any part of the Obligation, including any increase,
reduction or termination of the Commitment;
(c) any lack of validity or enforceability of the Credit Agreement,
the Notes, or any other Loan Paper or other agreement or instrument
relating thereto, including but not limited by the unenforceability of all
or any part of the Obligation by reason of the fact that (i) the
Obligation, and/or the interest paid or payable with respect thereto,
exceeds the amount permitted by Applicable Law, (ii) the act of creating
the Obligation, or any part thereof, is ultra vires, (iii) the officers
creating same acted in excess of their authority, or (iv) for any other
reason;
(d) any lack of corporate, partnership or other power of Company, any
Obligor or any other Person;
(e) any Debtor Relief Law involving Company, any Guarantor, any
Obligor or any other Person;
(f) any renewal, compromise, extension, acceleration or other change
in the time, manner or place of payment of, or in any other term of, all or
any of the Obligation; any adjustment, indulgence, forbearance, or
compromise that may be granted or given by any Lender or Administrative
Lender to Company, any Guarantor or any other Obligor; or any other
modification, amendment, or waiver of or any consent to departure from the
Credit Agreement, the Notes, or any other Loan Paper or other agreement or
instrument relating thereto without notification of any Guarantor (the
right to such notification being herein specifically waived by each
Guarantor);
(g) any exchange, release, sale, subordination, or non-perfection of
any collateral or Lien thereon or any lack of validity or enforceability or
change in priority, destruction, reduction, or loss or impairment of value
of any collateral or Lien thereon;
(h) any release or amendment or waiver of or consent to departure from
any other guaranty for all or any of the Obligation;
(i) the failure by any Lender or Administrative Lender to make any
demand upon or to bring any legal, equitable, or other action against
Company or any other Person (including without limitation any Guarantor or
any other Obligor), or the failure or delay by
-3-
any Lender or Administrative Lender to, or the manner in which any Lender
or Administrative Lender shall, proceed to exhaust rights against any
direct or indirect security for the Obligation;
(j) the existence of any claim, defense, set-off, or other rights
which Company or Guarantor may have at any time against Company, any
Lender, Administrative Lender, any Guarantor or any other Obligor, or any
other Person, whether in connection with this Guaranty, the Loan Papers,
the transactions contemplated thereby, or any other transaction;
(k) any failure of any Lender or Administrative Lender to notify any
Guarantor of any renewal, extension, or assignment of the Obligation or any
part thereof, or the release of any security, or of any other action taken
or refrained from being taken by any Lender or Administrative Lender, it
being understood that Lenders and Administrative Lender shall not be
required to give any Guarantor any notice of any kind under any
circumstances whatsoever with respect to or in connection with the
Obligation;
(l) any payment by Company to any Lender or Administrative Lender is
held to constitute a preference under any Debtor Relief Law or if for any
other reason any Lender or Administrative Lender is required to refund such
payment or pay the amount thereof to another Person; or
(m) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, Company, any Guarantor or any other
Obligor, including without limitation any defense by reason of any
disability or other defense of Company, or the cessation from any cause
whatsoever of the liability of Company, or any claim that Guarantor's
obligations hereunder exceed or are more burdensome than those of Company
or any other Obligor.
This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Obligation is rescinded or must
otherwise be returned by any Lender or any other Person upon the insolvency,
bankruptcy or reorganization of Company, any Guarantor, any other Obligor or
otherwise, all as though such payment had not been made.
3. Waiver. To the extent not prohibited by Applicable Law, each Guarantor
hereby waives: (a) promptness, protest, diligence, presentments, acceptance,
performance, demands for performance, notices of nonperformance, notices of
protest, notices of dishonor, notices of acceptance of this Guaranty and notices
of the existence, creation or incurrence of new or additional indebtedness, and
any of the events described in Section 2 and of any other occurrence or matter
with respect to any of the Obligation, this Guaranty or any of the other Loan
Papers; (b) any requirement that Administrative Lender or any Lender protect,
secure, perfect, or insure any Lien or security interest or any property subject
thereto or exhaust any right or take any action against Company, any Guarantor,
any other Obligor or any other Person or any collateral or pursue any other
remedy in Administrative Lender's or any Lender's power whatsoever; (c) any
right to assert against Administrative Lender or any Lender as a counterclaim,
set-off or cross-claim, any
-4-
counterclaim, set-off or claim which it may now or hereafter have against
Administrative Lender, any Lender, Company, any Guarantor or any other Obligor;
(d) any right to seek or enforce any remedy or right that Administrative Lender
or any Lender now has or may hereafter have against Company, any Guarantor, any
other Obligor or any other Person (to the extent permitted by Applicable Law);
(e) any right to participate in any collateral or any right benefiting
Administrative Lender or Lenders in respect of the Obligation; and (f) any right
by which it might be entitled to require suit on an accrued right of action in
respect of any of the Obligation or require suit against Company, any Guarantor,
any other Obligor or any other Person, whether arising pursuant to Section 34.02
of the Texas Business and Commerce Code, as amended, Section 17.001 of the Texas
Civil Practice and Remedies Code, as amended, Rule 31 of the Texas Rules of
Civil Procedure, as amended, or otherwise.
4. Subrogation and Subordination.
(a) Notwithstanding any reference to subrogation contained herein to the
contrary, each Guarantor hereby irrevocably waives any claim or other rights
which it may have or hereafter acquire against Company or any other Obligor that
arise from the existence, payment, performance or enforcement of such
Guarantor's obligations under this Guaranty, including, without limitation, any
right of subrogation, reimbursement, exoneration, contribution, indemnification,
any right to participate in any claim or remedy of any Lender or Administrative
Lender against Company, any Guarantor or any other Obligor or any collateral
which any Lender or Administrative Lender now has or hereafter acquires, whether
or not such claim, remedy or right arises in equity, or under contract, statutes
or common law, including without limitation, the right to take or receive from
Company, any Guarantor or any other Obligor, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or security on
account of such claim or other rights. If any amount shall be paid to any
Guarantor in violation of the preceding sentence and the Obligation shall not
have been paid in full, such amount shall be deemed to have been paid to such
Guarantor for the benefit of, and held in trust for the benefit of, Lenders, and
shall forthwith be paid to Administrative Lender to be credited and applied upon
the Obligation, whether matured or unmatured, in accordance with the terms of
the Credit Agreement. Each Guarantor acknowledges that it will receive direct
and indirect benefits from the financing arrangements contemplated by the Credit
Agreement and that the waiver set forth in this Paragraph 4(a) is knowingly made
in contemplation of such benefits.
(b) If any Guarantor becomes the holder of any indebtedness payable by
Company, any Guarantor or any other Obligor, such Guarantor hereby subordinates
all indebtedness owing to it from Company, any Guarantor and each other Obligor
to all indebtedness of Company, any Guarantor and each other Obligor to Lenders
and Administrative Lender, and agrees that upon the occurrence and continuance
of a Default or an Event of Default, it shall not accept any payment on the same
until final payment in full of the obligations of Company under the Credit
Agreement, the Notes and all other Loan Papers, and shall in no circumstance
whatsoever attempt to set-off or reduce any obligations hereunder because of
such indebtedness. If any amount shall nevertheless be paid to such Guarantor by
Company, any Guarantor or any other Obligor prior to payment in full of the
Obligation, such amount shall be held in trust for the benefit of Lenders and
Administrative
-5-
Lender and shall forthwith be paid to Administrative Lender to be credited and
applied to the Obligation, whether matured or unmatured.
5. Representations and Warranties. Each Guarantor hereby represents and
warrants that all representations and warranties as they apply to such Guarantor
only set forth in Article 4 of the Credit Agreement (each of which is hereby
incorporated by reference) are true and correct. Furthermore, each Guarantor
represents that it is Solvent.
6. Covenants. Each Guarantor hereby expressly assumes, confirms, and agrees
to perform, observe, and be bound by all conditions and covenants set forth in
the Credit Agreement, to the extent applicable to it, as if it were a signatory
thereto. Each Guarantor further covenants and agrees (a) punctually and properly
to perform all of such Guarantor's covenants and duties under all other Loan
Papers; (b) from time to time promptly to furnish Administrative Lender with any
information or writings which Administrative Lender may request concerning this
Guaranty; and (c) promptly to notify Administrative Lender of any claim, action,
or proceeding affecting this Guaranty.
7. Amendments, Etc. No amendment or waiver of any provision of this
Guaranty nor consent to any departure by any Guarantor therefrom shall in any
event be effective unless the same shall be in writing and signed by such
Guarantor, Administrative Lender, and, either all Lenders or Determining
Lenders, as appropriate, and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given.
8. Addresses for Notices. Unless otherwise provided herein, all notices,
requests, consents and demands shall be in writing and shall be delivered by
hand or overnight courier service, mailed or sent by telecopy to the respective
addresses specified herein, or, as to any party, to such other addresses as may
be designated by it in written notice to all other parties. All notices,
requests, consents and demands hereunder shall be deemed to have been given on
the date of receipt if delivered by hand or overnight courier service or sent by
telecopy, or if mailed, effective on the earlier of actual receipt or three days
after being mailed by certified mail, return receipt requested, postage prepaid,
addressed as aforesaid.
9. No Waiver; Remedies. No failure on the part of Administrative Lender or
any Lender to exercise, and no delay in exercising, any right hereunder or under
any of the Loan Papers shall operate as a waiver thereof; nor shall any single
or partial exercise of any right hereunder or under any of the Loan Papers
preclude any other or further exercise thereof or the exercise of any other
right. Neither Administrative Lender nor any Lender shall be required to (a)
prosecute collection or seek to enforce or resort to any remedies against
Company, any Guarantor, any other Obligor or any other Person, (b) join Company,
any Guarantor, any other Obligor or any other Person in any action in which
Administrative Lender or any Lender prosecutes collection or seeks to enforce or
resort to any remedies against Company, any Guarantor, any other Obligor or any
other Person liable on any of the Obligation, or (c) seek to enforce or resort
to any remedies with respect to any Liens granted to (or benefiting, directly or
indirectly) Administrative Lender or any Lender by Company, any Guarantor, any
other Obligor or any other Person.
-6-
Neither Administrative Lender nor any Lender shall have any obligation to
protect, secure or insure any of the Liens or the properties or interests in
properties subject thereto. The remedies herein provided are cumulative and not
exclusive of any remedies provided by Applicable Law.
10. Right of Set-off. Upon the occurrence and during the continuance of any
Event of Default, each Lender and Administrative Lender is hereby authorized at
any time and from time to time, to the fullest extent permitted by Law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by such Lender or Administrative Lender to or for the credit or the account of
any Guarantor against any and all of the obligations of such Guarantor now or
hereafter existing under this Guaranty, irrespective of whether or not such
Lender or Administrative Lender shall have made any demand under this Guaranty.
Each Lender and Administrative Lender agrees promptly to notify such Guarantor
after any such set-off and application, provided that the failure to give such
notice shall not affect the validity of such set-off and application or provide
a defense to such Guarantor's obligations under this Guaranty. The rights of
each Lender and Administrative Lender under this Section 10 are in addition to
other rights and remedies (including, without limitation, other rights of
set-off) which such Lender and Administrative Lender may have.
11. Liens. To the extent not prohibited by Applicable Law, each Guarantor
agrees that Administrative Lender or any Lender, in its discretion, without
notice or demand and without affecting either the liability of such Guarantor,
Company, any other Guarantor or any other Obligor, or any security interest or
other Lien, may foreclose any deed of trust or mortgage or similar Lien covering
interests in real or personal property, and the interests in real or personal
property secured thereby, by nonjudicial sale. Each Guarantor waives any defense
to the recovery by Administrative Lender or any Lender hereunder against
Company, such Guarantor or any collateral of any deficiency after a nonjudicial
sale and each Guarantor expressly waives any defense or benefits that may be
derived from Chapter 34 of the Texas Business and Commerce Code, Section 51.003
of the Texas Property Code, or any similar statute in effect in any other
jurisdiction. Without limiting the foregoing, each Guarantor waives, to the
extent not prohibited by Applicable Law, any defense arising out of any such
nonjudicial sale even though such sale operates to impair or extinguish any
right of reimbursement or subrogation or any other right or remedy of such
Guarantor against Company, any other Guarantor or any other Person or any
Collateral or any other collateral. Each Guarantor agrees that such Guarantor is
liable, subject to the limitations of Section 1 hereof, for any part of the
Obligation remaining unpaid after any foreclosure.
12. Continuing Guaranty; Transfer of Notes. This Guaranty is an irrevocable
continuing guaranty of payment and shall (a) remain in full force and effect
until final payment in full (after the Maturity Date) of the Obligation and all
other amounts payable under this Guaranty, (b) be binding upon each Guarantor,
its successors and assigns, and (c) inure to the benefit of and be enforceable
by Lender and Administrative Lender and their successors, transferees and
assigns. Without limiting the generality of the foregoing clause (c), to the
extent permitted by the Credit Agreement, each Lender may assign or otherwise
transfer its rights under the Credit Agreement, the Notes or any of the Loan
Papers or any interest therein to any other Person, and such other
-7-
Person shall thereupon become vested with all the rights or any interest
therein, as appropriate, in respect thereof granted to such Lender herein or
otherwise.
13. Information. Each Guarantor acknowledges and agrees that it shall have
the sole responsibility for obtaining from Company and each other Obligor such
information concerning Company's and each Obligor's financial condition or
business operations as such Guarantor may require, and that neither
Administrative Lender nor any Lender has any duty at any time to disclose to
Guarantor any information relating to the business operations or financial
conditions of Company or any Obligor.
14. GOVERNING LAW. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS. WITHOUT EXCLUDING ANY OTHER
JURISDICTION, EACH GUARANTOR AGREES THAT THE STATE AND FEDERAL COURTS OF TEXAS
LOCATED IN DALLAS, TEXAS, SHALL HAVE JURISDICTION OVER PROCEEDINGS IN CONNECTION
HEREWITH. THIS GUARANTY IS PERFORMABLE IN DALLAS COUNTY, TEXAS.
15. WAIVER OF JURY TRIAL. EACH GUARANTOR, ADMINISTRATIVE LENDER, AND
LENDERS HEREBY KNOWINGLY, VOLUNTARILY, IRREVOCABLY AND INTENTIONALLY WAIVE, TO
THE MAXIMUM EXTENT PERMITTED BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR CLAIM ARISING OUT OF OR RELATED TO THIS GUARANTY OR ANY OF THE
LOAN PAPERS OR THE TRANSACTIONS CONTEMPLATED THEREBY. THIS PROVISION IS A
MATERIAL INDUCEMENT TO LENDER ENTERING INTO THE CREDIT AGREEMENT.
16. Ratable Benefit. This Guaranty is for the ratable benefit of Lenders
and Administrative Lender, each of which shall share any proceeds of this
Guaranty pursuant to the terms of the Credit Agreement.
17. Guarantor Insolvency. Should any Guarantor become insolvent, fail to
pay its debts generally as they become due, voluntarily seek, consent to, or
acquiesce in the benefits of any Debtor Relief Law or become a party to or be
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 Lender or Administrative Lender granted hereunder, then, the
obligations of such Guarantor under this Guaranty shall be, as between such
Guarantor and such Lender and Administrative Lender, a fully-matured, due, and
payable obligation of such Guarantor to such Lender and Administrative Lender
(without regard to whether Company or any other Obligor is then in default under
the Credit Agreement or any other Loan Paper or whether any part of the
Obligation is then due and owing by Company or any other Obligor to such Lender
or Administrative Lender), payable in full by such Guarantor to such Lender or
Administrative Lender upon demand, which shall be the estimated amount owing in
respect of the contingent claim created hereunder.
-8-
18. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
19. ENTIRE AGREEMENT. THIS GUARANTY, TOGETHER WITH THE OTHER LOAN PAPERS,
REPRESENTS THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES
HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
================================================================================
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
================================================================================
-9-
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
LA QUINTA REALTY CORP.
By:
----------------------------------
John F. Schmutz
Vice President-Secretary
LA QUINTA PLAZA, INC.
By:
----------------------------------
John F. Schmutz
Vice President-Secretary
Address for all Guarantors:
112 East Pecan Street, Suite 1200
San Antonio, Texas 78205
LA QUINTA FINANCIAL CORPORATION
By:
----------------------------------
John F. Schmutz
Vice President-Secretary
LA QUINTA INVESTMENTS, INC.
By:
----------------------------------
John F. Schmutz
Vice President-Secretary
-10-
LQI ACQUISITION CORPORATION
By:
----------------------------------
John F. Schmutz
Authorized Representative
LA QUINTA MOTOR INNS LIMITED PARTNERSHIP
By: La Quinta Realty Corp., its General
Partner
By:
----------------------------------
John F. Schmutz
Vice President-Secretary
LQ-BATON ROUGE JOINT VENTURE
By: La Quinta Inns, Inc., its Managing
General Partner
By:
----------------------------------
William S. McCalmont
Senior Vice President-Chief
Financial Officer
-11-
LQM OPERATING PARTNERS, L.P.
By: La Quinta Realty Corp., its General
Partner
By:
----------------------------------
John F. Schmutz
Vice President-Secretary
LQ-BIG APPLE JOINT VENTURE
By: La Quinta Inns, Inc., its Partner
By:
----------------------------------
William S. McCalmont
Senior Vice President-Chief
Financial Officer
By: La Quinta Investments, Inc.,
its Partner
By:
------------------------------
John F. Schmutz
Vice President-Secretary
-12-
LQ-EAST IRVINE JOINT VENTURE
By: La Quinta Inns, Inc., its Partner
By:
--------------------------------------
William S. McCalmont
Senior Vice President-Chief Financial
Officer
By: La Quinta Investments, Inc., its Partner
By:
--------------------------------------
John F. Schmutz
Vice President-Secretary
LQ-INVESTMENTS I
By: La Quinta Inns, Inc., its Managing General
Partner
By:
--------------------------------------
William S. McCalmont
Senior Vice President-Chief Financial
Officer
By: La Quinta Investments, Inc., a General
Partner
By:
--------------------------------------
John F. Schmutz
Vice President-Secretary
-13-
LQ-INVESTMENTS II
By: La Quinta Inns, Inc., its Managing General
Partner
By:
--------------------------------------
William S. McCalmont
Senior Vice President-Chief Financial
Officer
By: La Quinta Investments, Inc., a General
Partner
By:
--------------------------------------
John F. Schmutz
Vice President-Secretary
LA QUINTA INNS OF LUBBOCK, INC.
By:
--------------------------------------
John F. Schmutz
Secretary
LA QUINTA INNS OF PUERTO RICO, INC.
By:
--------------------------------------
John F. Schmutz
Secretary
-14-
LA QUINTA DEVELOPMENT PARTNERS, L.P.
By: La Quinta Inns, Inc., its Sole General
Partner
By:
---------------------------------------
William S. McCalmont
Senior Vice President-Chief Financial
Officer
LQ MOTOR INN VENTURE-AUSTIN NO. 530
By: La Quinta Inns, Inc., a General Partner
By:
--------------------------------------
William S. McCalmont
Senior Vice President-Chief Financial
Officer
By: La Quinta Investments, Inc., a General
Partner
By:
--------------------------------------
John F. Schmutz
Vice President-Secretary
-15-
LA QUINTA SAN ANTONIO SOUTH JOINT VENTURE
By: La Quinta Inns, Inc., a General Partner
By:
--------------------------------------
William S. McCalmont
Senior Vice President-Chief Financial
Officer
By: La Quinta Investments, Inc., a General
Partner
By:
--------------------------------------
John F. Schmutz
Vice President-Secretary
-16-
LA QUINTA DENVER - PEORIA STREET, LTD.
By: La Quinta Inns, Inc., its General Partner
By:
--------------------------------------
William S. McCalmont
Senior Vice President-Chief Financial
Officer
-17-
LQ-LNL LIMITED PARTNERSHIP
By: La Quinta Inns, Inc., its Managing General
Partner
By:
--------------------------------------
William S. McCalmont
Senior Vice President-Chief Financial
Officer
-18-
EXHIBIT C
ASSIGNMENT AND ACCEPTANCE
Dated _______________, 199__
Reference is made to the Credit Agreement, dated as of November 17, 1997
(the "Credit Agreement") among La Quinta Inns, Inc., a Texas corporation
("Borrower"), NationsBank of Texas, N.A. as Administrative Lender
("Administrative Lender"), and the lenders parties thereto. Terms defined in the
Credit Agreement are used herein with the same meaning.
__________("Assignor") and ______________ ("Assignee") agree as follows:
1. Assignor hereby sells and assigns to Assignee, and Assignee hereby
purchases and assumes from Assignor, a ___% interest in and to all of Assignor's
rights and obligations under the Credit Agreement as of the Effective Date (as
defined below), with respect to such percentage interest in Assignor's
Commitment as in effect on the Effective Date, the principal amount of Revolving
Credit Advances owing to Assignor on the Effective Date, and the Revolving
Credit Note held by Assignor, subject to the terms and conditions of this
Assignment and Acceptance.
2. Assignor (a) represents and warrants that (i) as of the date hereof its
Commitment (without giving effect to assignments thereof which have not yet
become effective) is $ ______ and, as of the date hereof, the outstanding
principal amount of the Revolving Credit Advances owing to it (without giving
effect to assignments thereof which have not yet become effective) is $_____,
(ii) it is the legal and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any adverse claim; (b)
makes no representation or warranty and assumes no responsibility with respect
to (i) any statements, warranties, or representations made in or in connection
with the Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency, or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto or (ii) the financial
condition of the Borrower or the performance or observance by the Borrower of
any of its obligations under the Credit Agreement or any other instrument or
document furnished pursuant thereto; and (c) attaches the Revolving Credit Note
referred to in Paragraph 1 above to exchange such Revolving Credit Note for new
Revolving Credit Notes as follows: a Revolving Credit Note dated ______, 199__,
in the principal amount of $ ____ payable to the order of Assignee, and a
Revolving Credit Note dated _____, 199__, in the principal amount of $ ____
payable to the order of Assignor.
3. Assignee (a) confirms that it has received a copy of the Credit
Agreement and the other Loan Papers, together with copies of the financial
statements referred to in Sections 6.1(a) and 6.1(b) of the Existing Credit
Agreement 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
Acceptance; (b) agrees that it will, independently and without reliance upon the
Administrative Lender, Assignor, or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement and the other Loan Papers; (c) appoints and authorizes the
Administrative Lender to take such action as agent on its behalf and to exercise
such powers under the Credit Agreement, the other Loan Papers, and this
Assignment and Acceptance as are delegated to the Administrative Lender by the
terms thereof and hereof, together with such powers as are reasonably incidental
thereto and hereto; (d) agrees that it will perform in accordance with its terms
all of the obligations which by the terms of the Credit Agreement, the other
Loan Papers, and this Assignment and Acceptance are required to be performed by
it as a Lender; [and] (e) specifies the addresses set forth in Schedule I
attached hereto as its address for the receipt of notices and as its initial
LIBOR Lender Office, respectively[; and (f) attaches the forms prescribed by the
IRS certifying as to Assignee's status for purposes of determining exception
from United States withholding taxes with respect to all payments to be made to
Assignee under the Credit Agreement, the other Loan Papers, and this Assignment
and Acceptance or such other documents as are necessary to indicate that all
such payments are subject to such taxes at a rate reduced by an applicable tax
treaty].
4. The effective date for this Assignment and Acceptance shall be
_________, 199__ (the "Effective Date").
5. Upon such acceptance as of the Effective Date and upon the remittance of
a $3,500 processing fee to the Administrative Lender, (a) Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Lender thereunder and (b)
Assignor shall, to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement.
6. Upon such acceptance from and after the Effective Date, whenever the
Administrative Lender shall receive a payment, or whenever the Administrative
Lender shall make an application of funds, in respect of any aggregate
outstanding principal amount of the Revolving Credit Advances or in respect of
any aggregate amount of interest accrued on the Revolving Credit Advances, or in
respect of the commitment fee (other than a payment or an application of funds
in respect of any amount due and owing to any Lender or the Administrative
Lender under Sections 2.9, 5.3, 7.3, 7.5, or 9.2 of the Credit Agreement), the
Administrative Lender shall pay over to each of the Lenders an amount equal to
(i) such Lender's Pro Rata Share (as defined below) of such aggregate amount of
principal, (ii) such Lender's Pro Rata Share of such aggregate amount of
interest, and (iii) such Lender's Pro Rata Share of such aggregate amount of the
commitment fee.
The "Pro Rata Share" of any aggregate amount means, with respect to such
Lender, the amount equal to the product obtained by multiplying (i) such
aggregate amount and (ii) a fraction, the numerator of which is such Lender's
Commitment, or after the Revolving Credit Advances have been made, the principal
amount of the Revolving Credit Advances owing to such Lender and the denominator
of which is the sum of the Commitments of all of the Lenders, or after the
Revolving Credit Advances have been made, the aggregate principal amount of the
Revolving Credit Advances owing to all of the Lenders.
7. In the event that, after the Administrative Lender has paid to any
Lender its Pro
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Rata Share of any such payment received by the Administrative Lender or any such
application made by the Administrative Lender, such payment or application is
rescinded or must otherwise be returned or must be paid over by the
Administrative Lender for any reason, such Lender shall, upon notice by the
Administrative Lender, forthwith pay back to the Administrative Lender such
Lender's Pro Rata Share of the amount so rescinded or so returned or paid over.
8. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of Texas and the United States of America.
Without excluding any other jurisdiction, Assignee agrees that the courts of
Texas will have jurisdiction over proceedings in connection herewith.
9. Assignee's Specified Percentage shall be ____%.
10. This Assignment and Acceptance may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
[NAME OF ASSIGNOR]
By:
------------------------------
Name:
------------------------
Title:
------------------------
[NAME OF ASSIGNOR]
By:
------------------------------
Name:
------------------------
Title:
------------------------
Accepted this ___ day of ________, 199___
NATIONSBANK OF TEXAS, N.A.,
as Administrative Lender
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By:
------------------------------
Name:
------------------------
Title:
------------------------
LA QUINTA INNS, INC.
By:
------------------------------
Name:
------------------------
Title:
------------------------
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Schedule I
ASSIGNEE'S ADDRESS
1. Address for the Advances and Receipt of Notices
2. Initial LIBOR Lending Office
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EXHIBIT D
[Form of Confidentiality Agreement]
CONFIDENTIALITY AGREEMENT
[Date]
[Insert Name and Address
of Prospective Participant
or Assignee]
Re: Credit Agreement, dated as of November 17, 1997, among La Quinta Inns,
Inc. (the "Borrower"), the Lenders a party thereto, and NationsBank of
Texas, N.A., as Administrative Lender.
Dear ______________:
As a Lender party to the above-referenced Credit Agreement (the "Credit
Agreement"; capitalized terms used herein shall have the same meaning given to
them in the Credit Agreement), we have agreed with the Borrower pursuant to
Section 10.10 of the Credit Agreement to use reasonable precautions to keep
confidential, except as otherwise provided therein, all non-public information
identified by the Borrower as being confidential at the time the same is
delivered to us pursuant to the Credit Agreement.
As provided in said Section 9.10, we are permitted to provide you, as a
prospective [Participant] [Assignee], with certain of such non-public
information subject to the execution and delivery by you, prior to receiving
such non-public information, of a Confidentiality Agreement in this form. Such
information will not be made available to you until your execution and return to
us of this Confidentiality Agreement.
Accordingly, in consideration of the foregoing, you agree (on behalf of
yourself and each of your affiliates, directors, officers, employees and
representatives) that (A) such information will not be used by you except in
connection with the proposed [Participation] [Assignment] mentioned above and
(B) you shall use reasonable precautions, in accordance with your customary
procedures for handling confidential information and in accordance with safe and
sound banking practices, to keep such information confidential, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to your
counsel or to counsel for any of the Lenders or the Administrative Lender, (iii)
to bank examiners, auditors or accountants of any of the Lenders, (iv) to the
Administrative Lender, or any other Lender, (v) in connection with any
litigation to which you or any one or more of the Lenders are a party; provided,
further, that, unless specifically prohibited by Applicable Law or court order,
you agree, prior to disclosure thereof, to notify the Borrower of any request
for disclosure of any such non-public information (x) by any governmental agency
or representative thereof (other than
______________, 199__
Page 2
any such request in connection with an examination of your financial condition
by such governmental agency) or (y) pursuant to legal process; and provided,
finally, that in no event shall you be obligated to return any materials
furnished to you pursuant to this Confidentiality Agreement.
Would you please indicate your agreement to the foregoing by signing at the
place provided below the enclosed copy of this Confidentiality Agreement.
Very truly yours,
__________________________________
By:_______________________________
Title:____________________________
THE FOREGOING IS AGREED TO AS
OF THE DATE OF THIS LETTER.
By: ________________________
Name:___________________
Title:__________________