Exhibit 10.1
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CREDIT AGREEMENT
DATED AS OF MARCH 17, 2006
AMONG
AHR CAPITAL BOFA LIMITED
as a Borrower,
and
EACH BORROWER
FROM TIME TO TIME PARTY HERETO
and
ANTHRACITE CAPITAL, INC.
as Borrower Agent
and
BANK OF AMERICA, N.A.
as Lender
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TABLE OF CONTENTS
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SECTION 1 DEFINITIONS AND ACCOUNTING MATTERS........................1
1.01 Certain Defined Terms.....................................1
1.02 Accounting Terms and Determinations......................30
1.03 Exchange Rates; Currency Equivalents.....................30
1.04 Additional Alternative Currencies........................30
1.05 Change of Currency.......................................31
1.06 Times of Day.............................................31
SECTION 2 LOANS, NOTE AND PREPAYMENTS..............................31
2.01 Loans....................................................31
2.02 Evidence of Debt.........................................32
2.03 Procedure for Borrowing..................................32
2.04 Limitation on Types of Loans; Illegality.................33
2.05 Repayment of Loans; Interest.............................34
2.06 Prepayments..............................................34
2.07 Extension of Termination Date............................35
2.08 Repayment of Outstanding Loans after Termination Date....36
2.09 Taxes....................................................36
2.10 Additional Borrowers.....................................40
2.11 Appointment of Borrower Agent............................41
SECTION 3 PAYMENTS, COMPUTATIONS, ETC..............................41
3.01 Establishment of Accounts/Payments.......................41
3.02 Computations.............................................42
3.03 Requirements of Law......................................43
3.04 Indemnity................................................44
3.05 Fees.....................................................44
SECTION 4 CONDITIONS PRECEDENT.....................................44
4.01 Initial Loan.............................................44
4.02 Initial and Subsequent Loans.............................47
SECTION 5 REPRESENTATIONS AND WARRANTIES...........................48
5.01 Legal Name of Borrowers..................................48
5.02 Existence................................................48
5.03 Financial Condition......................................48
5.04 Litigation...............................................49
5.05 No Breach................................................49
5.06 Action...................................................49
5.07 Approvals................................................49
5.08 Margin Regulations.......................................50
5.09 Taxes....................................................50
5.10 Investment Company Act...................................50
5.11 Chief Executive Office/Jurisdiction of Organization......50
5.12 Location of Books and Records............................50
5.13 True and Complete Disclosure.............................50
5.14 ERISA....................................................50
5.15 Regulatory Status........................................50
5.16 Solvency.................................................51
5.17 Eligible Assets..........................................51
5.18 Representations as to Jurisdiction of Domicile of Borrowe51
5.19 Subsidiaries.............................................52
5.20 Separateness.............................................52
5.21 Irish Borrower Tax Requirements..........................53
SECTION 6 COVENANTS................................................53
6.01 Financial Statements.....................................53
6.02 Irish Borrower Tax Requirements..........................55
6.03 Litigation...............................................55
6.04 Purpose of Loans.........................................55
6.05 Changes to Accounting and Reporting Practices............56
6.06 Required Filings.........................................56
6.07 Existence, etc...........................................56
6.08 Notices..................................................56
6.09 Prohibition of Fundamental Changes.......................57
6.10 Transactions with Affiliates.............................57
6.11 Limitation on Indebtedness...............................57
6.12 Limitation on Liens......................................58
6.13 Limitation on Distributions..............................58
6.14 Limitation on Investments................................58
6.15 Lines of Business........................................58
6.16 Separateness.............................................58
6.17 Subsidiaries.............................................59
6.18 Independent Directors....................................59
6.19 Management Fees..........................................59
6.20 Underwriting Guidelines..................................59
6.21 Modification of Certain Agreements.......................60
6.22 ERISA....................................................60
SECTION 7 EVENTS OF DEFAULT........................................60
SECTION 8 REMEDIES UPON DEFAULT....................................63
SECTION 9 NO DUTY OF LENDER........................................64
SECTION 10 MISCELLANEOUS............................................64
10.01 Waiver...................................................64
10.02 Notices..................................................64
10.03 Indemnification and Expenses.............................64
10.04 Amendments...............................................66
10.05 Assignments and Participations...........................66
10.06 Successors and Assigns...................................67
10.07 Survival.................................................68
10.08 Captions.................................................68
10.09 Counterparts.............................................68
10.10 Credit Agreement Constitutes Security Agreement;
Governing Law............................................68
10.11 Submission To Jurisdiction; Waivers......................68
10.12 WAIVER OF JURY TRIAL.....................................69
10.13 Acknowledgments..........................................69
10.14 Periodic Due Diligence Review............................69
10.15 Eligible Asset Servicer..................................70
10.16 Judgment Currency........................................70
10.17 Treatment of Certain Information.........................71
10.18 Limited Recourse, Etc....................................71
SCHEDULES
SCHEDULE 1-A Representations and Warranties-England and Wales
SCHEDULE 1-B Representations and Warranties-Federal Republic of Germany
SCHEDULE 1-C Representations and Warranties-Scotland
SCHEDULE 1-D Mandatory Costs
SCHEDULE 1-E New Asset/New Jurisdiction/Alternate Currency Requirements
SCHEDULE 1-F Underlying Asset Servicers
SCHEDULE 2-A Collateral (England and Wales) Documents
SCHEDULE 2-B Collateral (Ireland) Documents
SCHEDULE 2.03 Borrower Account Information
SCHEDULE 5.01 Borrower Legal Names
SCHEDULE 5.11 Location of Chief Executive Office
SCHEDULE 6.01(a) Quarterly Servicing Information Report
SCHEDULE 6.01(b) Eligible Asset Information Report
EXHIBITS
EXHIBIT A Form of Promissory Note
EXHIBIT B Form of Request for Borrowing
EXHIBIT C-1 Form of Parent Pledge Agreement
EXHIBIT C-2 Form of Parent Deed of Charge
EXHIBIT C-3 Form of Borrower Security Agreement
EXHIBIT D Form of Parent Guaranty
EXHIBIT E Borrowing Base Certificate
EXHIBIT F Form of Compliance Certificate
EXHIBIT G Form of Intercompany Subordination Agreement
EXHIBIT H-1 Form of US Collection Account Control Agreement
EXHIBIT H-2 Form of English Sub-Collection Account Notice and
Acknowledgement of Charge
EXHIBIT I Form of Custodial and Payment Application Agreement
EXHIBIT J Form of Tax Certificate
EXHIBIT K Form of Eligible Asset Servicer Notice and Agreement
EXHIBIT L Form of Borrower Joinder
EXHIBIT M Form of Release
CREDIT AGREEMENT
CREDIT AGREEMENT (the "Agreement"), dated as of March 17, 2006, between
AHR CAPITAL BOFA LIMITED, a com pany organized under the laws of Ireland ("AHR
Capital") as a borrower (a "Borrower"), ANTHRACITE CAPI TAL, INC., a company
organized under the laws of Maryland as the Borrower Agent (the "Borrower
Agent"), the b orrowers from time to time parties hereto (each, a "Borrower",
and together with AHR Capital, collectively, t he "Borrowers") and BANK OF
AMERICA, N.A., as lender (the "Lender").
RECITALS
Each Borrower has requested that the Lender from time to time make
revolving loans to it and the Lender is prepared to make such loans upon the
terms and conditions hereof. Accordingly, the parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms. As used herein, the following terms (all
terms defined in this Section 1.01 or in other provisions of this Agreement in
the singular to have the same meanings when used in the plural and vice versa)
shall have the following meanings; provided, that all terms not defined in this
Agreement shall (unless otherwise provided herein) have the meanings ascribed to
such terms in the Parent Guaranty and the other Loan Documents:
"1934 Act" shall mean the Securities and Exchange Act of 1934, as
amended.
"Acceptable Appraisal" shall mean an appraisal (dated within twelve
months of the date of the initial funding for the applicable Eligible Asset)
acceptable to the Lender in its sole discretion (a) in respect of any Underlying
US Asset, prepared by an independent MAI qualified third party appraiser and
satisfying either (i) the requirements of the "Uniform Standards of Professional
Appraisal Practice" as adopted by the Appraisal Standards Board of the Appraisal
Foundation, or (ii) the requirements of Title XI of FIRREA and the regulations
promulgated thereunder (as the foregoing is amended, modified, restated,
replaced, waived, substituted, supplemented or extended from time to time), as
in effect on the date of such appraisal, (b) in respect of any Underlying UK
Asset, prepared by a suitable valuer carried out on an market value basis as
defined in the then current Royal Institution of Chartered Surveyors Appraisal
and Valuation Manual in association with the Incorporated Society of Valuers and
Auctioneers and the Institute of Revenues Rating and Valuation, Practice
Statement 4 (or its successor), or (c) in respect of any Underlying German
Asset, Underlying Scottish Asset or Underlying Other Eligible Jurisdiction
Asset, prepared by third party appraiser or valuer, in each case using
methodologies and standards consistent with local practices and requirements and
satisfactory to the Lender in its sole discretion.
"Acceptable Rating" shall mean a long-term debt rating of B- or higher
by S&P and/or Fitch or B3 or higher by Moody's, or, in the event of a split
rating, the lower of the two ratings.
"Additional Account Control Agreement" shall mean an agreement executed
by an Additional Borrower and the Lender, substantially in the form of Annex A-1
or Annex A-2 to the Borrower Security Agreement, as the same may be amended,
supplemented or otherwise modified from time to time.
"Additional Borrower" shall have the meaning set forth in clause (a) of
Section 2.10.
"Additional Borrower Effective Date" shall have the meaning set forth
in clause (a) of Section 2.10.
"Additional Borrower Notice" shall have the meaning set forth in clause
(a) of Section 2.10.
"Affiliate" shall mean, in respect of any specified Person, any other
Person directly or indirectly controlling, controlled by, or under common
control with, such Person. For the purposes of this definition, "Control" shall
mean the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise and "controlling" and
"controlled" shall have meanings correlative thereto; provided, that any Person
which owns directly or indirectly 25% or more of the securities having ordinary
voting power for the election of directors or other governing body of a
corporation or 25% or more of the partnership or other ownership interests of
any other Person (other than as a limited partner of such other Person) shall be
deemed to control such corporation or other Person; provided, further, that with
respect to any Borrower, no Person shall be deemed an Affiliate of any Borrower
due to such Person's having a Blackrock entity as such Person's manager.
"Alternative Currency" shall mean (a) each of Euro and Sterling and (b)
each other currency (other than Dollars) that is approved in accordance with
Section 1.04.
"Alternative Currency Equivalent" shall mean, at any time, with respect
to any amount denominated in Dollars, the equivalent amount thereof in the
applicable Alternative Currency as determined by the Lender, at such time on the
basis of the Spot Rate (determined in respect of the most recent Revaluation
Date) for the purchase of such Alternative Currency with Dollars.
"Allocated Underlying Debt" shall mean, with respect to any Underlying
Asset related to any Eligible Asset, any senior or pari passu Indebtedness
secured directly or indirectly by such Underlying Asset, including, without
limitation, any preferred equity interest or mezzanine debt that is senior to,
or pari passu with, such Eligible Asset in right of payment or lien priority.
"Anthracite" shall mean Anthracite Capital, Inc., a Maryland
corporation.
"Applicable Borrowing Base Percentage" shall have the meaning set forth
in the Fee Letter.
"Applicable Borrower Documents" shall have the meaning set forth in
clause (a) of Section 5.18.
"Applicable Margin" shall have the meaning set forth in the Fee Letter.
"Applicable Margin Increase Event" shall mean, as of any date of
determination, the occurrence and continuance of an Event of Default.
"Appraised Value" shall mean, with respect to any Underlying Asset, the
value of such Underlying Asset as determined by an Acceptable Appraisal.
"Approved Assignee" shall mean any Person satisfying the minimum
capital, net worth and/or similar measures of financial wherewithal required to
qualify as a permitted transferee of the Eligible Assets pursuant to the terms
of the Eligible Asset Documents and applicable securities laws.
"Asset Attributable Loan Balance" shall mean, in respect of each
Eligible Asset and subject to the Eligible Asset Funding Requirements, the
outstanding principal balance of all outstanding Loans attributable to such
Eligible Asset.
"Availability Period" shall mean the period from and including the
Closing Date to the Termination Date.
"Bankruptcy Code" shall mean the United States Bankruptcy Code of 1978,
as amended from time to time.
"Blackrock Management Agreement" shall mean the investment management
agreement, dated as of the Closing Date, between Blackrock Financial Management
Inc. and AHR Capital, as in effect on the Closing Date and as the same may be
modified from time to time in accordance with Section 6.21.
"Blackrock Entities" shall mean Blackrock Financial Management Inc. and
any of its Subsidiaries or Affiliates (other than Anthracite or any Borrower).
"BOA Hold Amount" shall mean an amount not less than thirty-four (34%)
percent of the Maximum Credit and the outstanding Loans.
"BOA Indebtedness" shall mean the aggregate indebtedness of the
Borrowers hereunder and under any other arrangement between any Borrower or an
Affiliate of any Borrower on the one hand and the Lender or an Affiliate of the
Lender on the other hand.
"Borrower" shall have the meaning provided in the introductory
paragraph hereof.
"Borrower Agent" shall have the meaning provided in the introductory
paragraph hereof pursuant to Section 2.11 and its successors and assigns in such
capacity.
"Borrower Joinder" shall mean the document referred to in Section 2.10
hereof, substantially in the form of Exhibit L and as the same shall be modified
and supplemented and in effect from time to time.
"Borrowing Base" shall mean the aggregate Collateral Value of all
Eligible Assets.
"Borrowing Base Deficiency Event" shall mean that the ratio of (a) the
aggregate outstanding principal amount of all outstanding Loans, to (b) the
Borrowing Base, is equal to, or greater than, 1.05:1.00; provided, that for the
purposes hereof, the Borrowing Base shall be converted into its Dollar
Equivalent.
"Borrowing Base Certificate" shall mean a certificate, substantially in
the form of Exhibit E, with appropriate insertions, showing the Borrowing Base
as of the date set forth therein, and executed on behalf of the Borrowers by a
Responsible Officer of the Borrower Agent.
"Borrower Security Agreement" shall mean the Borrower Security
Agreement to be executed and delivered by AHR Capital and each other Borrower in
favor of the Lender, substantially in the form of Exhibit C-3, as the same may
be amended, supplemented or otherwise modified from time to time.
"Borrower Security Agreement Addendum" shall mean the addendum to be
executed and delivered by an Additional Borrower in favor of the Lender,
substantially in the form of Annex B to the Borrower Security Agreement, as the
same may be amended, supplemented or otherwise modified from time to time.
"Business Day" shall mean any day other than (i) a Saturday or Sunday,
(ii) a day on which the New York Stock Exchange or the Federal Reserve Bank of
New York is authorized or obligated by law or executive order to be closed or
(iii) a day which is a legal holiday in Ireland. When used with respect to a
Reset Date, a Business Day shall mean a day on which banks in London, England
are not closed for interbank or foreign exchange transactions.
"Capital Lease Obligations" shall mean, for any Person, all obligations
of such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) Property to the extent such obligations are required
to be classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP, and for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.
"Capital Stock" shall mean all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, and
all similar ownership interests in a Person (other than a corporation),
including, without limitation, non-managing member membership interests and
limited partnership interests, and any and all warrants or options to purchase
any of the foregoing.
"Cash" shall mean cash on deposit in the US Collection Account, the
English Sub-Collection Account or in any other account maintained by any
Borrower with any depository institution.
"Change of Control" shall mean the occurrence of any of the following
events: (a) any "person" or "group" (within the meaning of Section 13(d) or
14(d) of the 1934 Act) shall become, or obtain rights (whether by means of
warrants, options or otherwise) to become, the "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the 1934 Act), directly or indirectly, of a
percentage of 20% or more of the total voting power of all classes of Capital
Stock of Anthracite entitled to vote generally in the election of directors, (b)
any event pursuant to which BlackRock Financial Management, Inc. shall cease to
act as the external manager of Anthracite with exclusive responsibility for
Anthracite's investment decision-making, or (c) Anthracite shall cease to own
and control, directly beneficially and of record on a fully diluted basis, 100%
of the Capital Stock of AHR Capital free and clear of all Liens (other than
Liens in favor of the Lender pursuant to the Collateral Documents).
"Clearstream" shall mean Clearstream Banking, a societe anonyme and
member of the Deutsche Borse Group, or any successor to its trading and
settlement business.
"Closing Date" shall mean the date upon which the conditions precedent
set forth in Section 4.01 and Section 4.02 of this Agreement shall have been
satisfied.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral" shall mean the term "Collateral" (or the equivalent
thereof) as defined in the Collateral Documents.
"Collateral Documents" shall mean (a) the Collateral (US) Documents,
(b) the Collateral (England and Wales) Documents, (c) the Collateral (Federal
Republic of Germany) Documents, (d) the Collateral (Ireland) Documents and (e)
the Collateral (Other Eligible Jurisdiction) Documents.
"Collateral (England and Wales) Documents" shall mean the collective
reference to all security documents listed on Schedule 2-A Collateral (England
and Wales) Documents which are subject to, and governed by, the laws of England
and Wales, as applicable, hereafter delivered to the Lender granting a Lien on
any property of any Person to secure the obligations and liabilities of each
Borrower under any Loan Document.
"Collateral (Federal Republic of Germany) Documents" shall mean the
collective reference to all security documents, each of which shall be
satisfactory to the Lender and its counsel in form and substance in its sole
discretion, and which are subject to, and governed by, the laws of the Federal
Republic of Germany, hereafter delivered to the Lender granting a Lien on any
property of any Person to secure the obligations and liabilities of each
Borrower under any Loan Document.
"Collateral (Ireland) Documents" shall mean the collective reference to
the Parent Deed of Charge and the other security documents listed on Schedule
2-B Collateral (Ireland) Documents which are subject to, and governed by, the
laws of Ireland, as applicable, hereafter delivered to the Lender granting a
Lien on any property of any Person to secure the obligations and liabilities of
each Borrower under any Loan Document.
"Collateral (Other Eligible Jurisdiction) Documents" shall mean the
collective reference to all security documents which are subject to, and
governed by, the laws of any Eligible Jurisdiction (other than the United States
of America, England and Wales, Ireland, or the Federal Republic of Germany),
hereafter delivered to the Lender granting a Lien on any property of any Person
to secure the obligations and liabilities of each Borrower under any Loan
Document.
"Collateral (US) Documents" shall mean the collective reference to the
Parent Guaranty, the Parent Pledge Agreement, the Borrower Security Agreement
the US Collection Account Control Agreement and all other security documents
which are subject to, and governed by, applicable New York law (or other
applicable federal or state law) hereafter delivered to the Lender granting a
Lien on any property of any Person to secure the obligations and liabilities of
each Borrower under any Loan Document.
"Collateral Value" shall mean, with respect to any Eligible Asset, an
amount equal to the product of the Applicable Borrowing Base Percentage
multiplied by the Market Value of such Eligible Asset.
"Collateral Value Cash Sweep Event" shall mean, with respect to any
Eligible Asset, that the ratio of (a) the Asset Attributable Loan Balance
attributable to such Eligible Asset, to (b) the Collateral Value of such
Eligible Asset, is equal to, or greater than, 1.05:1.00, but less than
1:10:1.00.
"Collateral Value Deficiency Event" shall mean, with respect to any
Eligible Asset, that the ratio of (a) the Asset Attributable Loan Balance
attributable to such Eligible Asset, to (b) the Collateral Value of such
Eligible Asset, is equal to, or greater than, 1.10:1.00.
"Compliance Certificate" shall mean a certificate, substantially in the
form of Exhibit F, with appropriate insertions, and executed on behalf of each
Borrower by a Responsible Officer of such Borrower.
"Concentration Limits" shall mean any limitations on asset classes,
property types, tenants, geography and other categories related to the Eligible
Assets which may be established by the Lender, from time to time, in its
reasonable business judgment; provided, that such "Concentration Limits" shall
not be applied in respect of assets previously included in the Borrowing Base as
Eligible Assets.
"Costs" shall have the meaning provided in Section 10.03(a) hereof.
"Custodial and Payment Application Agreement" shall mean the Custodial
and Payment Application Agreement, by and among the Borrower Agent, the
Custodian and the Lender, substantially in the form of Exhibit I to this
Agreement, as amended, restated, supplemented or otherwise modified and in
effect from time to time.
"Custodian" shall mean LaSalle Bank National Association, as custodian
under the Custodial and Payment Application Agreement, or any successor
Custodian comparably rated and qualified and appointed by the Borrower Agent
with the prior written consent of the Lender (which consent shall not be
unreasonably withheld or delayed).
"Default" shall mean an Event of Default or an event that with notice
or lapse of time or both would become an Event of Default.
"Defaulted Underlying Asset" shall mean any Underlying Asset (a) that
is ninety (90) days or more delinquent or (b) for which there is a non-monetary
default (beyond any applicable notice and cure period) under the related asset
documents.
"Delinquent Underlying Asset" shall mean any Underlying Asset that is
thirty (30) or more days, but less than ninety (90) days, delinquent under the
related asset documents.
"Discretionary Underlying Asset" shall mean any Underlying Asset which
is a hospitality property or a single-tenant non-credit retail or office
property.
"Dollars" and "$" shall mean lawful money of the United States of
America.
"Dollar Equivalent" shall mean, at any time, (a) with respect to any
amount denominated in Dollars, such amount, and (b) with respect to any amount
denominated in any Alternative Currency, the equivalent amount thereof in
Dollars as determined by the Lender, at such time on the basis of the Spot Rate
(determined in respect of the most recent Revaluation Date) for the purchase of
Dollars with such Alternative Currency.
"Dollar Equivalent Overadvance Date" shall mean any date on which a
Dollar Equivalent Overadvance Event has occurred.
"Dollar Equivalent Overadvance Event" shall mean that, prior to giving
effect to any Dollar Equivalent Overadvance Loan, the Dollar Equivalent of the
aggregate amount of Loans outstanding under this Agreement exceeds the Maximum
Credit solely as a result of a fluctuation in the rate of exchange between an
Alternative Currency and Dollars.
"Dollar Equivalent Overadvance Loan" shall mean, on any Dollar
Equivalent Overadvance Date, any Loan made in Dollars pursuant to Section 2.01
(b).
"Dollar Equivalent Overadvance Maximum Credit" shall mean, in respect
of any Dollar Equivalent Overadvance Loan, $15,000,000.
"Dollar Equivalent Overadvance Maturity Date" shall mean, in respect of
any Dollar Equivalent Overadvance Loan, the date which is ninety (90) days from
the Funding Date of such Dollar Equivalent Overadvance Loan.
"Eligible Asset" shall mean, without duplication, any of the following
types of performing assets owned by a Borrower:
(a) Eligible CMBS Securities,
(b) Eligible B Notes,
(c) Eligible Mezzanine Loans, and
(d) Eligible Other Investments;
provided, that any Eligible Asset shall be deemed ineligible in the event (w)
such Borrower does not have valid title to such Eligible Asset or is subject to
any adverse claim or Lien, other than Liens permitted pursuant to Section 6.12,
(x) the Underlying Asset is (A) a Defaulted Underlying Asset, (B) a Delinquent
Underlying Asset, (C) a Prohibited Underlying Asset, or (D) unless permitted to
be included as an Eligible Asset by the Lender in its sole discretion, a
Discretionary Underlying Asset, (y) there is a breach of any Concentration
Limit; or (z) the Lender has deemed such Eligible Asset to be otherwise
ineligible in its good faith business judgment; provided, further, that (i) any
Eligible Asset (other than any Eligible Assets included in the Borrowing Base on
the Closing Date) shall have been included in the Borrowing Base in accordance
with the provisions set forth in Section 2.03(d) and (ii) the Borrower owning
such asset shall be deemed to have consented to the inclusion of any Eligible
Asset in the Borrowing Base by identifying such Eligible Asset in the schedule
delivered to the Lender pursuant to clause (i) of Section 2.03(d); provided,
further, that any Eligible Asset shall be a "qualifying asset" (as described in
the Irish Taxes Act) and shall not be an asset that requires any Borrower to
become authorized under the relevant Irish insurance legislation.
"Eligible Asset Funding Requirement" shall mean:
(a) Except with respect to Eligible Loans secured by three (3) or
more Underlying Assets and as otherwise permitted by the Lender in its
sole discretion, the Asset Attributable Loan Balance attributable to
any one Eligible Asset shall not exceed thirty (30%) percent of the
Maximum Credit; and
(b) the Asset Attributable Loan Balance attributable to Eligible
Mezzanine Loans shall not exceed forty (40%) percent of the Maximum
Credit; provided, that Eligible Mezzanine Loans with an LTV greater
than eighty-five (85%) percent shall not exceed ten (10%) percent of
the Maximum Credit.
"Eligible Asset Documents" shall mean any and all documents, records,
imaged copies, computer data files, agreements, instruments or information
relating to the Eligible Assets to the extent available to a Borrower.
"Eligible Asset Information" shall mean the information set forth on
Schedule 6.01(b).
"Eligible Asset Net Cash Proceeds" shall mean, in respect of any
Eligible Asset, the net cash proceeds received from the payment, prepayment or
redemption (in whole or in part) in respect of such Eligible Asset.
"Eligible Asset Proceeds Prepayment Amount" shall mean, in respect of
any Eligible Asset and on any date of determination, an amount equal to the
product of the Applicable Borrowing Base Percentage applied to such Eligible
Asset, multiplied by, the Eligible Asset Net Cash Proceeds received in respect
of such Eligible Asset.
"Eligible Asset Servicer" shall mean any sub-servicer engaged by a
Borrower in respect of any of the Eligible Assets.
"Eligible Asset Servicer Notice and Agreement" shall have the meaning
set forth in Section 10.15.
"Eligible Asset Servicing Agreement" shall have the meaning set forth
in Section 10.15.
"Eligible B-Notes" shall mean performing loans which are:
(a) (i) junior notes in performing commercial mortgage loans secured
by first liens in mortgages on multifamily or commercial real estate
property (or a participation therein) located in an Eligible
Jurisdiction that are subordinate in right of payment to one or more
separate promissory notes secured by a direct or beneficial interest in
the same property; or (ii) any senior, junior or pari passu
participation interests in junior notes described in the preceding
clause (i);
(b) denominated in an Eligible Currency;
(c) satisfy all the Eligible Jurisdiction Relevant Warranties; and
(d) satisfy such other criteria established by the Lender in its
good faith business judgment;
provided, that no loans with an LTV greater than ninety (90%) percent shall be
deemed Eligible B Notes hereunder.
"Eligible CMBS Securities" shall mean performing fixed or floating
rate mortgage-backed bonds that:
(a) represent a beneficial ownership interest in one or more first
lien commercial mortgage loans secured by a single or multiple
Underlying Assets located in an Eligible Jurisdiction;
(b) are denominated in an Eligible Currency;
(c) are rated with an Acceptable Rating and have not been placed on
credit watch where any downgrade that could reasonably be expected to
occur as a result of review would be likely to result in such
securities not having an Acceptable Rating;
(d) (i) are settled in book-entry form through the facilities of
Clearstream and/or Euroclear against payment therefor in immediately
available funds or (ii) are in bearer form (whether in global form or
otherwise) and are transferable by way of physical delivery;
(e) satisfy all the Eligible Jurisdiction Relevant Warranties; and
(f) satisfy such other criteria established by the Lender in its
good faith business judgment.
"Eligible Currency" shall mean Dollars and any Alternative Currency;
provided, that such Eligible Currency shall be the currency in which the
applicable Eligible Asset is denominated.
"Eligible Jurisdiction" shall mean the Federal Republic of Germany,
England or any New Jurisdiction approved in writing by the by the Lender, in its
sole discretion, from time to time.
"Eligible Jurisdiction Relevant Warranties" shall mean the following in
respect of Eligible Assets:
(a) in respect of England and Wales, the representations and
warranties contained in Schedule 1-A England and Wales;
(b) in respect of the Federal Republic of Germany, the
representations and warranties contained in Schedule 1-B Federal
Republic of Germany;
(c) in respect of Scotland, the representations and warranties
contained in Schedule 1-C Scotland
(d) in respect of any New Jurisdiction, such representations and
warranties as are from time to time approved by the Lender in its sole
discretion in accordance with the applicable New Asset/New
Jurisdiction/Alternate Currency Requirements and, upon such approval,
(i) such representations and warranties shall be annexed to this
Agreement under Schedule 1 with the appropriate reference to the
applicable Eligible Jurisdiction and (ii) this Agreement shall
thereupon be deemed amended for that purpose.
"Eligible Mezzanine Loans" shall mean performing loans which:
(a) are primarily secured by all or partial direct or indirect
ownership interests in a company, partnership or other entity owning,
operating or controlling, directly or indirectly, multifamily or
commercial properties which (i) are located in any Eligible
Jurisdiction and (ii) constitute Underlying Assets;
(b) are denominated in an Eligible Currency;
(c) satisfy all the Eligible Jurisdiction Relevant Warranties; and
(d) satisfy such other criteria established by the Lender in its
good faith business judgment;
provided, that no such loans shall be deemed Eligible Mezzanine Loans
hereunder if the sum of (i) Eligible Mezzanine Loans and (ii) Allocated
Underlying Debt has an LTV greater than ninety (90%) percent.
"Eligible Other Investment" shall mean any performing real estate
structured finance product (including, without limitation, REIT debt
securities), which:
(a) does not otherwise conform to the definition of Eligible CMBS
Securities, Eligible B Notes or Eligible Mezzanine Loans;
(b) is denominated in an Eligible Currency;
(c) in respect of which the Underlying Assets are located in an
Eligible Jurisdiction;
(d) satisfies all the Eligible Jurisdiction Relevant Warranties; and
(e) satisfies such other criteria as may be established by the
Lender in its sole discretion.
"English Sub-Collection Account" shall mean a deposit, custody,
money-market or other similar account (whether, in any case, time or demand or
interest or non-interest bearing) maintained by AHR Capital with the Custodian,
as securities intermediary.
"English Sub-Collection Account Notice and Acknowledgement of Charge"
shall mean the acknowledgment of notice of charge in respect of the English
Sub-Collection Account, substantially in the form of Exhibit H-2, by and among
AHR Capital, ABN-AMRO, and the Lender, as the same shall be modified and
supplemented and in effect from time to time.
"English Sub-Collection Account Remittance Date" shall mean the date
which is two (2) Business Days following the date on which payments are received
by any Borrower in respect of any Eligible Asset and deposited into the English
Sub-Collection Account pursuant to the applicable Collateral (England and Wales)
Document.
"EMU" shall mean the economic and monetary union in accordance with the
Treaty of Rome 1957, as amended by the Single European Act 1986, the Maastricht
Treaty of 1992 and the Amsterdam Treaty of 1998.
"EMU Legislation" shall mean the legislative measures for the
introduction of, changeover to or operation of a single or unified European
currency.
"Equity Proceeds" shall mean any proceeds received from any sale or
issuance of Capital Stock.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade or business that
is a member of any group of organizations (i) described in Section 414(b) or (c)
of the Code of which a Borrower is a member and (ii) solely for purposes of
potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of
the Code and the lien created under Section 302(f) of ERISA and Section 412(n)
of the Code, described in Section 414(m) or (o) of the Code of which such
Borrower is a member.
"Euro", "EUR" and "(euro)" shall mean the lawful currency of the
Participating Member States introduced in accordance with the EMU Legislation.
"Euroclear" shall mean Euroclear Bank N.A./S.V., or any successor to
its trading and settlement business.
"Eurocurrency Base Rate" shall have the meaning specified in the
definition of Eurocurrency Rate.
"Eurocurrency Rate" shall mean for any Interest Period on any Reset
Date with respect to a Eurocurrency Rate Loan, a rate per annum determined by
the Lender pursuant to the following formula:
Eurocurrency Rate Eurocurrency Base Rate
------------------------------------------
= 1.00 - Eurocurrency Reserve Percentage
where,
"Eurocurrency Base Rate" shall mean, for such Interest Period:
(a) the applicable Screen Rate for such Interest Period; or
(b) if the applicable Screen Rate shall not be available, the rate
per annum determined by the Lender as the rate of interest at which
deposits in the relevant currency for delivery on the first day of such
Interest Period in Same Day Funds in the approximate amount of the
Eurocurrency Rate Loan being made by the Lender and with a term
equivalent to such Interest Period would be offered by the Lender's
London Branch (or other branch or Affiliate) to major banks in the
London or other offshore interbank market for such currency for a
one-month period at their request at approximately 4:00 p.m. (London
time) two Business Days prior to the first day of such Interest Period.
"Eurocurrency Rate Loan" shall mean any Loan that bears interest at the
Eurocurrency Rate. Eurocurrency Rate Loans may be denominated in Dollars or in
any Alternative Currency. All Loans denominated in an Alternative Currency must
be Eurocurrency Rate Loans.
"Eurocurrency Reserve Percentage" shall mean, for any day during any
Interest Period, the reserve percentage (expressed as a decimal, carried out to
five decimal places) in effect on such day, whether or not applicable to the
Lender, under regulations issued from time to time by the Board of Governors of
the Federal Reserve System of the United States for determining the maximum
reserve requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to Eurocurrency funding (currently referred to
as "Eurocurrency liabilities"). The Eurocurrency Rate for each outstanding
Eurocurrency Rate Loan shall be adjusted automatically as of the effective date
of any change in the Eurocurrency Reserve Percentage.
"Event of Default" shall have the meaning provided in Section 7 hereof.
"Examiner" shall have the meaning provided in Section 1 of the
Companies (Amendment) Act of 1990, Ireland.
"Federal Funds Rate" shall mean, for any day, the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations for the day of such transactions received by the Lender from three
federal funds brokers of recognized standing selected by it.
"Fee Letter" shall mean the confidential letter, dated as of the
Closing Date, by and between the Lender and the Borrowers.
"FIRREA" shall mean the Financial Institutions Reform, Recovery and
Enforcement Act of 1989, as amended.
"Fitch" shall mean Fitch Ratings.
"Funding Date" shall mean the date on which a Loan is made hereunder.
"GAAP" shall mean generally accepted accounting principles as in effect
from time to time in the United States.
"Governmental Authority" shall mean any nation or government, any state
or other political subdivision, agency or instrumentality thereof, any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government and any court or arbitrator having
jurisdiction over any Borrower, any of its Subsidiaries or any of its
properties.
"Guarantee" shall mean, as to any Person, any obligation of such Person
directly or indirectly guaranteeing any Indebtedness of any other Person or in
any manner providing for the payment of any Indebtedness of any other Person or
otherwise protecting the holder of such Indebtedness against loss (whether by
virtue of partnership arrangements, by agreement to keep-well, to purchase
assets, goods, securities or services, or to take-or-pay or otherwise); provided
that the term Guarantee shall not include (a) endorsements for collection or
deposit in the ordinary course of business, (b) obligations to make servicing
advances for delinquent taxes and insurance or other obligations in respect of
any properties, to the extent required by the Lender and (c) non-recourse
carve-out and environmental indemnities in respect of any Non-Recourse
Indebtedness incurred in connection with commercial real estate properties. The
amount of any Guarantee of a Person shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Guarantee is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by such Person. The terms
Guarantee and Guaranteed used as verbs shall have correlative meanings.
"Guarantor" shall mean Anthracite.
"Hedge Agreement" shall mean any interest rate or currency swap, cap or
collar agreement or similar arrangement or foreign exchange contract entered
into by any Person providing for protection against fluctuations in interest
rates or currency exchange rates or the exchange of nominal interest
obligations, either generally or under specific contingencies.
"Indebtedness" shall mean, for any Person without duplication: (a)
obligations created, issued or incurred by such Person for borrowed money
(whether by loan, the issuance and sale of debt securities or the sale of
Property to another Person subject to an understanding or agreement, contingent
or otherwise, to repurchase such Property from such Person); (b) obligations of
such Person to pay the deferred purchase or acquisition price of Property or
services, other than trade accounts payable (other than for borrowed money)
arising, and accrued expenses incurred, in the ordinary course of business so
long as such trade accounts payable are payable within ninety (90) days after
the date the respective goods are delivered or the respective services are
rendered; (c) Indebtedness of others secured by a Lien on the Property of such
Person, whether or not the respective Indebtedness so secured has been assumed
by such Person; (d) obligations (contingent or otherwise) of such Person in
respect of letters of credit or similar instruments issued or accepted by banks
and other financial institutions for account of such Person; (e) Capital Lease
Obligations of such Person; (f) obligations of such Person under repurchase
agreements, sale/buy-back agreements or like arrangements; (g) Indebtedness of
others Guaranteed by such Person; (h) all obligations of such Person incurred in
connection with the acquisition or carrying of fixed assets by such Person; (i)
Indebtedness of general partnerships of which such Person is a general partner;
(j) Hedge Agreements and (k) all Off-Balance Sheet Obligations of such Person.
"Indemnified Party" shall have the meaning set forth in Section
10.03(a).
"Intercompany Subordination Agreement" shall mean an Intercompany
Subordination Agreement substantially in the form of Exhibit G and executed on
behalf of each Borrower by a Responsible Officer of such Borrower.
"Interest Period" shall mean, with respect to any Loan, (a) initially,
the period commencing on the Funding Date to but excluding the first Payment
Date and (b) thereafter, each period commencing on a Payment Date to but
excluding the next Payment Date. Notwithstanding the foregoing, no Interest
Period may end after the Termination Date.
"Investment" shall mean in respect of any Person, any loan or advance
to such Person, any purchase or other acquisition of any Capital Stock of such
Person, any capital contribution to such Person or any other investment or
interest in such Person.
"Irish Accounts" shall mean, collectively, the current account (account
number 26932340) and the deposit account (account number 26933888) in the name
of AHR Capital with The Governor and Company of the Bank of Ireland
"Irish Borrower" shall mean:
(a) any Borrower operating in Ireland through a branch, agency or
other form of permanent establishment with which the Agreement is
connected; or
(b) any Borrower that is resident in Ireland for the purposes of the
Irish Taxes Act.
"Irish Borrower Tax Requirements" shall mean the following:
(a) each Irish Borrower is and shall continue to be resident in
Ireland for the purposes of the Irish Taxes Act;
(b) each Irish Borrower carries on and shall continue to carry on in
Ireland the business of holding, managing or both the holding and
managing of the Eligible Assets or interests in the Eligible Assets;
(c) apart from activities ancillary to the business of managing or
holding the Eligible Assets or interests in the Eligible Assets, each
Irish Borrower carries on and shall continue to carry on no other
activities;
(d) the market value of the Eligible Assets or interests in the
Eligible Assets held or managed by each Irish Borrower was not less
than 10,000,000 Euro on the day on which the Eligible Assets or
interest in the Eligible Assets were first held by it;
(e) all of the transactions entered into or that will be entered
into by each Irish Borrower have been or will be entered into, as the
case may be, on an arm's length basis, apart from any transaction or
arrangement where Section 110(4) of the Irish Taxes Act applies to any
interest or other distribution payable under the transaction or
arrangement unless the transaction or arrangement concerned is excluded
from that provision by virtue of Section 110(5) of the Irish Taxes Act;
(f) each Irish Borrower has notified the Irish Revenue Commissioners
in the prescribed form that it is or intends to be a qualifying company
for the purposes of Section 110(1) of the Irish Taxes Act and has
supplied to the Irish Revenue Commissioners such other particulars
relating to it as may be specified in the prescribed form;
(g) the proceeds of all monies or funding received by each Irish
Borrower have been, or as applicable, shall be used by each Irish
Borrower in the course of its business as a qualifying company within
the meaning of Section 110 of the Irish Taxes Act;
(h) excluding costs of incorporation of any Irish Borrower, any
material expenses (being expenses in the aggregate exceeding $50,000
per annum) incurred or to be incurred by each Irish Borrower including
interest payable by such Irish Borrower shall be deductible in
computing its profits for the purposes of the Irish Taxes Act;
(i) any transaction entered into by each Irish Borrower is not or
will not be entered into by such Borrower for tax avoidance reasons;
and
(j) no Irish Borrower is or will become a member of a VAT Group.
"Irish Debenture" shall mean the debenture governed by the laws of
Ireland to be executed and delivered by AHR Capital in favor of the Lender, as
the same may be amended, supplemented or otherwise modified from time to time.
"Irish Revenue Commissioners" shall mean the Revenue Commissioners of
Ireland (being the tax authority of Ireland).
"Irish Taxes Act" shall mean the Taxes Consolidation Act, 1997, as
amended of Ireland.
"Irish Tax Indemnification Obligations" shall mean the following:
(a) Each Irish Borrower shall pay and, within three (3) Business
Days of demand by the Lender, indemnify the Lender against any cost,
loss or liability that the Lender may incur in relation to all stamp
duty, registration or other similar taxes payable in connection with or
in respect of this Agreement or any document relating thereto in
connection with the holding or management of the Eligible Assets;
(b) The amount of all payments made by each Irish Borrower to the
Lender pursuant to this Agreement shall be deemed to be exclusive of
any Value Added Tax. In the event the Lender is required, under
applicable law, to charge Value Added Tax on any supply made by any
Lender to any Borrower in connection with the Agreement, such Borrower
shall pay to the Lender an amount equal to the amount of the Value
Added Tax; and
(c) Each Irish Borrower shall pay and within three (3) Business Days
of demand by the Lender, indemnify the Lender against all Value Added
Tax incurred by the Lender in respect of costs or expenses to be
reimbursed by a Borrower to the extent that the Lender is not entitled
to credit or repayment of the Value Added Tax.
"Lender" shall have the meaning provided in the introductory paragraph
hereto.
"Lender Generated Eligible Asset" shall have the meaning provided in
clause (c) of Section 10.03 hereof.
"Lien" shall mean any mortgage, lien, pledge, charge, security interest
or similar encumbrance.
"Loan" shall mean the advances and extensions of credit made pursuant
to clauses (a) and (b) of Section 2.01 hereof.
"Loan Documents" shall mean, collectively, this Agreement, the Note,
the Parent Guaranty, the Custodial and Payment Application Agreement, the
Intercompany Subordination Agreement, the Collateral Documents and the Fee
Letter and each other agreement, certificate, document or instrument executed by
a Borrower or the Guarantor and delivered to the Lender in connection with any
of the foregoing in each case as amended, restated, supplemented or otherwise
modified and in effect from time to time. For the avoidance of doubt, the
Eligible Asset Documents shall not constitute Loan Documents hereunder.
"LTV Ratio" or "Loan-to-Value" shall mean in respect of Eligible
Mezzanine Loans and Eligible B Notes, the ratio of (i) the outstanding principal
amount of such Eligible Mezzanine Loans or Eligible B Notes at such time, plus,
the amount of any Allocated Underlying Debt for such Eligible Mezzanine Loans or
Eligible B Notes at such time, to (ii) the Appraised Value of the Underlying
Asset(s) as determined by reference to an Acceptable Appraisal with such
Appraised Value being subject to adjustment by the Lender in its good faith
business judgment.
"Mandatory Cost" shall mean, with respect to any period, the percentage
rate per annum determined in accordance with Schedule 1-D Mandatory Costs.
"Market Value" shall mean, as of any date of determination in respect
of an Eligible Asset and calculated in the applicable Eligible Currency, equal
to the value of any Eligible Asset as determined by the Lender (including, if
applicable, the positive or negative value of any Permitted Hedge Obligations)
in its sole discretion using methodology and parameters determined in its sole
discretion; provided, that on any date such Eligible Asset is initially included
in the Borrowing Base as a New Asset pursuant to Section 2.03(d)(i), "Market
Value" shall be determined by the Lender in its good faith business judgment.
"Material Adverse Change" shall mean a material adverse change on (a)
any of the property, business, operations or financial condition of (i)
Anthracite and its consolidated Subsidiaries, taken as a whole, or (ii) any
Borrower, (b) the ability of Anthracite or any Borrower to perform its
obligations under any of the Loan Documents to which it is a party, (c) the
validity or enforceability of any of the Loan Documents or (d) the rights and
remedies of the Lender under any of the Loan Documents.
"Maximum Credit" shall mean $100,000,000; provided, that on each Dollar
Equivalent Overadvance Date, the "Maximum Credit" shall be increased by an
amount not to exceed the Dollar Equivalent Overadvance Maximum Credit.
"Moody's" shall mean Moody's Investors Service, Inc.
"Multiemployer Plan" shall mean a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been or are required to be
made by any Borrower or any ERISA Affiliate and that is covered by Title IV of
ERISA.
"New Asset" shall mean any asset that a Borrower proposes to be
included as an Eligible Asset in the Borrowing Base.
"New Asset Legal Documents" shall mean, in respect of the applicable
New Asset/New Jurisdiction/Alternate Currency Requirements, such documents,
certificates and instruments as determined by the Lender in its sole discretion
(including, but not limited to, as applicable, any Collateral (Other Eligible
Jurisdiction) Document, any additional Collateral (US) Document, opinions of
counsel and amendments to the Loan Documents), which documents, certificates and
instruments shall be in form and substance satisfactory to the Lender in its
sole discretion.
"New Asset Materials" shall mean (each only to the extent available to
a Borrower) with respect to the proposed inclusion of any New Assets in the
Borrowing Base, a credit approval memo, including (x) a summary of the material
terms (as determined by the Borrower Agent in its good faith business judgment)
of the underlying intercreditor agreements and participation agreements, in each
case relating to such New Asset (provided, that the Lender acknowledges and
agrees that each such summary shall be used solely for the Lender's ease of
reference in the Lender's own independent review of the underlying loan
documentation and that, notwithstanding anything to the contrary in any Loan
Document, the applicable Borrower makes no representation or warranty whatsoever
as to the accuracy or completeness of any summary) and (y) a summary of the
potential transaction benefits and all material underwriting risks, all
Underwriting Issues and all other characteristics of the proposed transaction
that a reasonable lender would consider material, together with the following
information:
(a) With respect to each Eligible Mezzanine Loan or Eligible B Note:
(i) an Acceptable Appraisal;
(ii) the Eligible Asset Documents;
(iii) current rent roll, if applicable;
(iv) financial statements of the related property-owning entity,
certified by such entity, for the past two (2) years and separate
financial or other reporting statements with respect to each property
owned by such entity and relating to such Eligible Mezzanine Loan or
Eligible B Note, to the extent prepared by such entity;
(v) trailing 12-month unaudited income statement of the related
property-owning entity and income statements with respect to each
property owned by such entity and relating to such Eligible Mezzanine
Loan or Eligible B Note, to the extent prepared by such entity;
(vi) pro-forma cash flow, plus historical information; (vii)
current operating budget of the related property-owning entity and a
separate operating budget with respect to each property owned by such
entity and relating to such Eligible Mezzanine Loan or Eligible B Note;
(viii) description of the Underlying Asset and the ownership
structure of the borrower and the issuer (including, without
limitation, the board of directors, if applicable) and financial
statements of the borrower and the issuer;
(ix) indicative debt service coverage ratios;
(x) indicative loan-to-value ratio;
(xi) term sheet outlining the transaction generally;
(xii) the relationship between the mortgagor and any Borrower,
if any;
(xiii) confirmation that such Eligible Mezzanine Loan or
Eligible B Note has been approved by the applicable Borrower's credit
committee, to the extent applicable;
(xiv) any exceptions to the representations and warranties set
forth in Schedule 1 to this Agreement;
(xv) if such Eligible Asset is serviced by a sub-servicer
engaged by a Borrower, the identity of such sub-servicer and
(xvi) such other information or other deliverables as may be
reasonably requested by the Lender in respect of a particular Eligible
Mezzanine Loan or Eligible B Note.
(b) With respect to each Eligible CMBS Security: (
i) collateral summary books which include, to the extent
provided to any Borrower, the following:
(A) loan detail and asset description;
(B) map and photo;
(C) rent roll;
(D) operating information; and
(E) appraisal, environmental, engineering summary;
(ii) underwriting materials and analysis, which includes the
executive summary, all loss scenarios and the asset summaries prepared
for the twenty (20) largest loans;
(iii) loan data disk;
(iv) materials furnished to S&P, Moody's or Fitch in connection
with the issuance of such Eligible CMBS Security (including any rating
letters or private or public placement memoranda), to the extent in
such Borrower's possession;
(v) Securitization Documents;
(vi) remittance report for most recent period in such Borrower's
possession;
(vii) quarterly remittance reports in such Borrower's
possession;
(viii) legal opinions delivered with respect to the Eligible
CMBS Security in such Borrower's possession;
(ix) special servicing or other reports, if any, delivered with
respect to the Eligible CMBS Security in such Borrower's possession;
(x) accounting reports delivered with respect to the Eligible
CMBS Security in such Borrower's possession;
(xi) a copy of the executed trade ticket (including evidence of
the dollar price paid by such Borrower and purchase spread over
treasuries or other relevant benchmark for such Eligible CMBS Security)
and any adjustments to the purchase price not reflected in such trade
ticket; and
(xii) such other information or other deliverables as may be
reasonably requested by the Lender in respect of a particular Eligible
CMBS Security.
"New Asset/New Jurisdiction/Alternate Currency Requirements" shall mean
the requirements relating to (a) the inclusion of any New Asset as an Eligible
Asset, (b) the inclusion of any New Jurisdiction as an Eligible Jurisdiction,
and (c) the approval of any Alternate Currency, and such other matters related
or incidental thereto, in each case as set forth in Schedule 1-E.
"New Jurisdiction" shall mean any jurisdiction (a) which the Borrower
Agent has requested to be included as an Eligible Jurisdiction for the purpose
of including New Assets located in such New Jurisdiction in the Borrowing Base
pursuant to Section 2.03(d)(i) or (b) without duplication of clause (i) hereof,
in which any Underlying Assets are located.
"New Jurisdiction Materials" shall mean with respect to the proposed
inclusion of any New Jurisdiction as an Eligible Jurisdiction:
(a) a summary of the applicable law in such New Jurisdiction
relating to the making of loans, the granting and enforcement of a Lien
in respect of each Eligible Asset and each Underlying Asset and such
other matters as determined by the Lender in its sole discretion
(provided, that the Lender acknowledges and agrees that each such
summary shall be used solely for the Lender's ease of reference in the
Lender's own independent review of the underlying loan documentation);
(b) representations and warranties in form and substance
satisfactory to the Lender in respect of (i) each Eligible Asset
proposed to be included in such New Jurisdiction or (ii) the applicable
Underlying Asset located in such New Jurisdiction, and in each case
consistent with local practices and requirements;
(c) any other materials deemed necessary by the Lender in its sole
discretion.
"Non-Recourse Indebtedness" shall have the meaning set forth in the
Parent Guaranty.
"Note" shall mean the promissory note referred to in Section 2.02
hereof for Loans and any promissory note delivered in substitution or exchange
therefor, in each case, substantially in the form of Exhibit A and as the same
shall be modified and supplemented and in effect from time to time.
"Obligations" shall mean the unpaid principal amount of, and interest
(including, without limitation, interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to a Borrower, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding) on the Loans, and all
other obligations and liabilities of the Borrowers to the Lender, whether direct
or indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, or out of, or in connection with this
Agreement (including any amounts payable pursuant to Sections 3.03, 10.03 and
10.14(c)), the Notes, the Fee Letter, any other Loan Documents, and any other
document made, delivered or given in connection therewith or herewith, whether
on account of principal, interest, reimbursement obligations, fees, indemnities,
costs, expenses (including, without limitation, all fees and disbursements of
counsel to the Lender that are required to be paid pursuant to the terms of the
Loan Documents) or otherwise For the avoidance of doubt, the aggregate amount of
the "Obligations" shall not at any time be reduced by operation of Section
10.18.
"Off-Balance Sheet Obligations" shall mean, with respect to any Person
and its consolidated Subsidiaries determined on a consolidated basis as of any
date of determination thereof, without duplication and to the extent not
included as a liability on the consolidated balance sheet of such Person and its
consolidated Subsidiaries in accordance with GAAP: (a) the monetary obligations
under any financing lease or so-called "synthetic", tax retention or off-balance
sheet lease transaction which, upon the application of any insolvency laws to
such Person or any of its consolidated Subsidiaries, would be characterized as
indebtedness; (b) the monetary obligations under any sale and leaseback
transaction which does not create a liability on the consolidated balance sheet
of such Person and its consolidated Subsidiaries; or (c) any other monetary
obligation arising with respect to any other transaction which (i) is
characterized as indebtedness for tax purposes but not for accounting purposes
in accordance with GAAP or (ii) is the functional equivalent of or takes the
place of borrowing but which does not constitute a liability on the consolidated
balance sheet of such Person and its consolidated Subsidiaries (for purposes of
this clause (c), any transaction structured to provide tax deductibility as
interest expense of any dividend, coupon or other periodic payment shall be
deemed to be the functional equivalent of a borrowing).
"Organic Document" shall mean, relative to Anthracite or any Borrower,
as applicable, its certificate of incorporation, by-laws, certificate of
partnership, partnership agreement, certificate of formation, limited liability
agreement and all shareholder agreements, voting trusts and similar arrangements
to which Anthracite or such Borrower is a party applicable to any of its
authorized shares of Capital Stock.
"Parent Deed of Charge" shall mean the Deed of Charge (In Respect Of
Shares) governed by the laws of Ireland to be executed and delivered by
Anthracite in favor of the Lender, substantially in the form of Exhibit C-2, as
the same may be amended, supplemented or otherwise modified from time to time.
"Parent Financial Covenants" shall mean the financial covenants
contained in the Parent Guaranty; provided, that compliance with the Parent
Financial Covenants shall be determined by excluding the assets and liabilities
of variable interest entities required to be consolidated under FIN 46R and
without giving any effect to any changes in or in the interpretation of FAS 140
after the date hereof.
"Parent Guaranty" shall mean the Parent Guaranty to be executed and
delivered by Anthracite in favor of the Lender, substantially in the form of
Exhibit D, as the same may be amended, supplemented or otherwise modified from
time to time.
"Parent Pledge Agreement" shall mean the Pledge Agreement to be
executed and delivered by Anthracite in favor of the Lender, substantially in
the form of Exhibit C-1, as the same may be amended, supplemented or otherwise
modified from time to time.
"Participating Member State" shall mean each state so described in any
EMU Legislation.
"Payment Date" shall mean the 15th calendar day of May, August,
November and February, commencing with the first such date after the related
Funding Date; provided, that if any such date is not a Business Day, the
"Payment Date" shall be the immediately succeeding Business Day.
"Permitted Hedge Obligations" shall mean, in respect of a Borrower, any
Hedge Agreement which is entered into by such Borrower in the ordinary course of
business for the purpose of directly mitigating risks associated with Eligible
Assets, or changes in the value of Eligible Assets, and not for purposes of
speculation or taking a "market view"; provided that:
(a) the relevant Hedge Agreement does not contain any provision
exonerating the non-defaulting party from its obligation to make
payments on outstanding transactions to the defaulting party;
(b) the relevant Hedge Agreement is entered into for bona fide
protection against potential losses in relation to interest or currency
rates and the relevant Hedge Agreement does not at the time that it is
entered into, and is not intended to, create the same or a similar
economic benefit as an agreement to borrow money or raise financing or
an agreement which otherwise has the same commercial effect as a
borrowing (other than in a de minimis amount in aggregate);
(c) the relevant Hedge Agreement is entered into on terms (including
interest rates) that are an accepted market standard for a company of
comparable standing to such Borrower;
(d) each Borrower and the applicable counterparty has entered into
an intercreditor agreement in respect of the relevant Hedge Agreement,
and the applicable counterparty has agreed to waive (i) any right of
cross default (other than in respect of the relevant Eligible Asset
itself) or (ii) in respect of any other transaction which is not a
Permitted Hedge Obligation, any right of set-off or netting
arrangements whether arising by contract or other applicable law;
provided, that any Hedge Agreement constituting an unsecured forward
contract for the purchase of any Eligible Currency with a maturity of
ninety (90) days or less, shall not be required to satisfy this
paragraph (d);
(e) in the event that the applicable counterparty is not the Lender
(or an Affiliate of the Lender), such Hedge Agreement shall be fully
subordinated in form and substance acceptable to the Lender in its sole
discretion; provided, that any Hedge Agreement constituting an
unsecured forward contract for the purchase of any Eligible Currency
with a maturity of ninety (90) days or less, shall not be required to
be subordinated hereunder; and
(f) the relevant Hedge Agreement has been pledged to the Lender
pursuant to a Collateral Document to secure the Obligations in form and
substance reasonably satisfactory to the Lender.
"Person" shall mean any individual, corporation, company, voluntary
association, partnership, joint venture, limited liability company, trust,
unincorporated association or government (or any agency, instrumentality or
political subdivision thereof).
"Plan" shall mean an employee benefit or other plan established or
maintained by a Borrower or any ERISA Affiliate and covered by Title IV of
ERISA, other than a Multiemployer Plan.
"Prescribed Laws" shall mean, collectively, (a) the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (Public Law 107-56) (The "USA PATRIOT Act"), (b)
Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001,
and relating to Blocking Property and Prohibiting Transactions With Persons Who
Commit, Threaten to Commit, or Support Terrorism, (c) the International
Emergency Economic Power Act, 50 U.S.C. ss.1701 et. seq. and (d) all other
Requirements of Law relating to money laundering or terrorism.
"Prohibited Underlying Asset" shall mean any Underlying Asset which (a)
is a restaurant, convenience store, gas station, condo conversion, or "value
added" construction project or (b) is secured by one or more construction loans;
provided, that in the case of any Eligible CMBS Securities, (x) any Underlying
Asset which is otherwise a Prohibited Underlying Asset hereunder shall not be
deemed a Prohibited Underlying Asset and (y) the Appraised Value of all
"Prohibited Underlying Assets" related to such Eligible CMBS Securities shall
not exceed five percent (5%) of the Appraised Value of all Underlying Assets
related to such Eligible CMBS Securities.
"Property" shall mean any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Qualifying Lender" means a Lender (and for the purposes of this
definition, the term "Lender" shall include any participant, assignee, successor
or transferee of or to a Lender's rights or obligations under this Agreement)
which at the time the payment is made, is beneficially entitled to the payments
to be made by an Irish Borrower hereunder and is:
(a) the holder of a license granted under Section 9 of the Central
Bank Act, 1971 of Ireland which is carrying on a banking business in
Ireland and whose lending office with which this Agreement is connected
is located in Ireland; or
(b) an authorised credit institution under the terms of the Codified
Banking Directive (2000/12/EC) which has duly established a branch in
Ireland and has made all necessary notifications to its home state
competent authorities required thereunder in relation to its intention
to carry on a banking business in Ireland and which is carrying on a
bona fide banking business in Ireland and whose lending office with
which this Agreement is connected is located in Ireland; or
(c) either:
(i) a person that is resident in a territory with which Ireland
has a double taxation treaty that is in effect or a person that is
resident in a member state of the European Communities (other than
Ireland), in each case where residence is determined under the tax laws
of the relevant territory or Member State (together a "Relevant
Territory"); or
(ii) a U.S. company that it is incorporated in the US and
subject to tax in the U.S. on its worldwide income; or
(iii) a U.S. L.L.C. provided, that the ultimate recipients of
the interest are resident for tax purposes in a Relevant Territory and
that the business conducted through the L.L.C. is so structured for
market reasons and not for tax avoidance purposes;
provided, that in (a) and (b) the Lender does not, and in (c) neither the Lender
nor the ultimate recipients of the interest, operate in Ireland through a branch
or agency with which the payments from the Irish Borrower are connected;
(d) a qualifying company within the meaning of Section 110 Irish
Taxes Act; or
(e) a person that is a resident of a territory with which Ireland
has a double taxation treaty that is in effect, under the terms of that
double taxation treaty; provided, that person is entitled under the
terms of that double taxation treaty, subject to the completion of any
necessary procedural formalities, to receive all payments under the
Finance Documents without a withholding or deduction for or on account
of Taxes provided that such person has completed in a timely manner any
required forms to obtain this relief, submitted those forms to the
Irish Revenue Commissioners and provided a copy of those forms to the
Irish Borrower; or
(f) a company which includes a body corporate, which is resident in
Ireland for the purposes of the Irish Taxes Act or which carries on a
trade in Ireland through a branch or agency:
(i) which advances money under this Agreement in the ordinary
course of a trade which includes the lending of money;
(ii) in whose hands any interest payable under this Agreement is
taken into account in computing the trading income of the company; and
(iii) which has complied with all of the provisions of Section
246(5)(a) of the Irish Taxes Act including making the appropriate
notifications thereunder to the Irish Revenue Commissioners and the
relevant Irish Borrower, and provided, further,that the Lender has not
ceased to be a company to which Section 246(5)(a) applies.
"Quarterly Servicing Information" shall mean the information set forth
on Schedule 6.01(a), as the same may be amended, supplemented or otherwise
modified from time to time.
"REIT" shall mean a Person qualifying for treatment as a "real estate
investment trust" under the Code.
"Request for Borrowing" shall have the meaning provided in Section
2.03(a) hereof and substantially in the form of Exhibit B, as the same shall be
modified and supplemented and in effect from time to time.
"Requirement of Law" shall mean as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law (including, without duplication, Prescribed Laws), treaty,
rule or regulation or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject.
"Reset Date" shall mean each Payment Date.
"Responsible Officer" shall mean, as to any Person, the chief executive
officer, the chief financial officer, the President, the Vice President, any
director, the Secretary or the Treasurer or any other duly appointed officer of
such Person customarily performing functions similar to those performed by any
of the foregoing officers of such Person.
"Restricted Payment" shall mean any dividend or other distribution
(whether in cash, securities or other property) with respect to any Capital
Stock of any Person, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such Capital Stock, or on account of any return of capital to such Person's
stockholders, partners or members (or the equivalent Person thereof).
"Revaluation Date" shall mean (a) with respect to any Loan, (i) each
date of a borrowing of a Eurocurrency Rate Loan denominated in an Alternative
Currency, or (ii) such additional dates as the Lender shall designate from time
to time in its sole discretion and (b) to the extent applicable, with respect to
the calculation of the fees payable pursuant to the Fee Letter, each Business
Day.
"Same Day Funds" shall mean (a) with respect to disbursements and
payments in Dollars, immediately available funds, and (b) with respect to
disbursements and payments in an Alternative Currency, same day or other funds
as may be determined by the Lender to be customary in the place of disbursement
or payment for the settlement of international banking transactions in the
relevant Alternative Currency.
"Screen Rate" shall mean, for any Interest Period:
(a) the rate per annum equal to the rate determined by the Lender to
be the offered rate that appears on the page of the Telerate screen (or
any successor thereto) that displays an average British Bankers
Association Interest Settlement Rate for deposits in the relevant
currency (for delivery on the first day of such Interest Period) with a
term of one-month, determined as of approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest Period;
or
(b) if the rate referenced in the preceding clause (a) does not
appear on such page or service or such page or service shall cease to
be available, the rate per annum equal to the rate determined by the
Lender to be the offered rate on such other page or other service that
displays an average British Bankers Association Interest Settlement
Rate for deposits in the relevant currency (for delivery on the first
day of such Interest Period) with a term of one-month, determined as of
approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period.
"SEC" shall mean the Securities and Exchange Commission.
"Securitization Documents" shall mean, with respect to any Eligible
CMBS Securities, any pooling and servicing agreements, special servicing
agreements or other agreements governing the issuance and administration of such
Eligible CMBS Securities and any offering document used in the distribution and
sale of such Eligible CMBS Securities (including, without limitation, the
preliminary and final private placement memorandum, prospectus and/or offering
memorandum).
"S&P" shall mean Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc.
"Single Employer Plan" shall mean as to any Person any Plan of such
Person which is not a Multiemployer Plan.
"Solvent" shall mean (i) the amount of the "present fair saleable
value" of the assets of Anthracite and its consolidated Subsidiaries, taken as a
whole, will, as of such date, exceed the amount of all "liabilities of
Anthracite and its consolidated Subsidiaries, taken as a whole, contingent or
otherwise", as of such date, as such quoted terms are determined in accordance
with applicable federal and state laws governing determinations of the
insolvency of debtors, (ii) the present fair saleable value of the assets of
Anthracite and its consolidated Subsidiaries, taken as a whole, will, as of such
date, be greater than the amount that will be required to pay the liabilities of
Anthracite and its consolidated Subsidiaries, taken as a whole, on their
respective debts as such debts become absolute and matured, (iii) neither
Anthracite and its consolidated Subsidiaries, taken as a whole, will have, as of
such date, an unreasonably small amount of capital with which to conduct their
respective businesses, and (iv) Anthracite and its consolidated Subsidiaries,
taken as a whole, will be able to pay their respective debts as they mature. For
purposes of this Section, "debt" means "liability on a claim", "claim" means any
(x) right to payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured, and (y) right to an
equitable remedy for breach of performance if such breach gives rise to a right
to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured
or unsecured.
"Specified Date" shall mean, in respect of any Borrower as to which an
Event of Default pursuant to clauses (ii), (iii) and (iv) of Section 7 has
occurred and is continuing, the date which is the earlier of (A) the date on
which such Borrower obtains actual knowledge of such breach and (B) the date on
which the Lender notifies such Borrower in writing of such breach.
"Specified Event of Default" shall mean any Event of Default set forth
in Sections 7(a), (b), (f), (g), (h), (i) or (o).
"Spot Rate" shall mean, in respect of any currency, the rate determined
by the Lender to be the rate quoted by the Person acting in such capacity as the
spot rate for the purchase by such Person of such currency with another currency
through its principal foreign exchange trading office at approximately 11:00
a.m. on the date two Business Days prior to the date as of which the foreign
exchange computation is made; provided, that the Lender may obtain such spot
rate from another financial institution designated by the Lender if the Person
acting in such capacity does not have as of the date of determination a spot
buying rate for any such currency.
"Sterling" and "(pound)" shall mean the lawful currency of the United
Kingdom.
"Subsidiary" shall mean, with respect to any Person, any corporation,
partnership or other entity of which at least a majority of the securities or
other ownership interests having by the terms thereof Voting Power to elect a
majority of the board of directors or other persons performing similar functions
of such corporation, partnership or other entity (irrespective of whether or not
at the time securities or other ownership interests of any other class or
classes of such corporation, partnership or other entity shall have or might
have Voting Power by reason of the happening of any contingency) is at the time
directly or indirectly owned or controlled by such Person or one or more
Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person; provided, that any issuer of certificated subordinate classes and
residual equity interests in collateralized debt obligations, collateralized
loan obligations or collateralized bond obligations (including, without
limitation, any synthetic collateralized debt obligations or synthetic
collateralized loan obligations) shall not be deemed a "Subsidiary" hereunder.
"Table Funded New Asset" shall mean a New Asset which is financed by
the Lender simultaneously with the origination or acquisition thereof, which
origination or acquisition is financed with proceeds of a Loan, pursuant to the
Borrower Agent's request, paid directly to the settlement agent for such New
Asset for disbursement in connection with such origination or acquisition. A New
Asset shall cease to be a "Table Funded New Asset" after the Custodian has
delivered a trust receipt to the Lender certifying its receipt of the New Asset
Legal Documents therefor.
"Tangible Net Worth" shall have the meaning set forth in the Parent
Guaranty.
"Tax Certificate" shall mean a certificate in substantially the form of
Exhibit J to this Agreement.
"Termination Date" shall mean September __, 2008, or such other date on
which this Agreement shall be extended or terminate in accordance with Section
2.07 or such other date as otherwise provided in this Agreement.
"Termination Date Extension" shall have the meaning provided in Section
2.07.
"UK Custody Agreement" shall mean the custody agreement governed by the
laws of England and Wales, by and among the applicable Borrower, ABN AMRO (or
its designee), the Lender and the Borrower Agent, which shall be in form and
substance satisfactory to the Lender.
"Underlying Assets" shall mean, in respect of any Eligible Asset, the
income-producing commercial real estate, loan note, bond, security or other
asset which directly or indirectly secures such Eligible Asset or to which such
Eligible Asset is otherwise related.
"Underlying Asset Net Cash Proceeds" shall mean, in respect of any
Underlying Asset, the net cash proceeds received from the payment, prepayment or
redemption (in whole or in part) in respect of such Underlying Asset.
"Underlying Asset Proceeds Prepayment Amount" shall mean, in respect of
any Eligible Asset and the related Underlying Asset on any date of
determination, an amount equal to the product of the Applicable Borrowing Base
Percentage applied to such Eligible Asset, multiplied by, the Underlying Asset
Net Cash Proceeds.
"Underlying Asset Servicer" shall mean (a) any entity listed on
Schedule 1-F hereto or (b) any other entity which manages and/or services any of
the Underlying Assets.
"Underlying Asset Servicer Instruction Letter" shall mean an
irrevocable instruction letter in form and substance satisfactory to the Lender
by the applicable Borrower to the Underlying Asset Servicer (and acknowledged by
such Underlying Asset Servicer), instructing the Underlying Asset Servicer to
deposit all payments to be made to such Borrower in respect of any Eligible
Assets serviced by such Underlying Asset Servicer into the English
Sub-Collection Account.
"Underlying German Assets" shall mean any Underlying Asset located in
the Federal Republic of Germany.
"Underlying Other Eligible Jurisdiction Assets" shall mean any
Underlying Asset located in any Eligible Jurisdiction (other than the Federal
Republic of Germany, Scotland, England and Wales or the United States of
America).
"Underlying Scottish Assets" shall mean any Underlying Asset located in
Scotland.
"Underlying UK Assets" shall mean any Underlying Asset located in
England or Wales.
"Underlying US Assets" shall mean any Underlying Asset located in the
United States of America.
"Underwriting Guidelines" shall mean any underwriting guidelines from
time to time adopted by any Borrower and as the same may be modified from time
to time in accordance with Section 6.20.
"Underwriting Issues" shall mean, with respect to any New Asset, all
material information that has come to any Borrower's attention which, based on
the making of reasonable inquiries and the exercise of reasonable care and
diligence under the circumstances, would be considered a materially "negative"
factor (either separately or in the aggregate with other information) to a
reasonable institutional mortgage buyer in determining whether to originate or
acquire such New Asset, including, but not limited to, the extent of such
Borrower's knowledge in respect of (x) whether any of the Eligible Assets were
rejected for inclusion in, or repurchased from, any securitization transaction,
warehouse loan facility or a repurchase transaction due to the breach of a
representation and warranty, or (y) the existence of a material defect in the
loan documentation or closing deliveries (such as any absence of any material
Eligible Asset Document).
"Uniform Commercial Code" or "UCC" shall mean the Uniform Commercial
Code as in effect on the date hereof in the State of New York; provided, that if
by reason of mandatory provisions of law, the perfection or the effect of
perfection or non-perfection of the security interest or the renewal or
enforcement thereof in any Collateral is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than New York.
"US Collection Account" shall mean a deposit, custody, money-market or
other similar account (whether, in any case, time or demand or interest or
non-interest bearing) maintained by each Borrower with LaSalle Bank National
Association, as depository institution which shall at all times be subject to
the first priority security interest of the Lender pursuant to the US Collection
Account Control Agreement.
"US Collection Account Control Agreement" shall mean the US Collection
Account Control Agreement with respect to the US Collection Account
substantially in the form of Exhibit H-1, by and among AHR Capital, as grantor,
LaSalle Bank National Association, as securities intermediary, and the Lender,
as secured party, as the same shall be modified and supplemented and in effect
from time to time.
"Value Added Tax" shall mean any tax levied pursuant to the VAT Act
1972 (as amended).
"VAT Group" shall mean a "VAT group" as defined by Section 8(8) of the
VAT Act 1972 (as amended).
"Voting Power" shall mean of any Voting Stock the number of votes such
Voting Stock are entitled to cast for directors of a Borrower at any meeting of
stockholders of such Borrower.
"Voting Stock" shall mean all securities issued by a Borrower having
the ordinary power to vote in the election of directors of such Borrower, other
than securities having such power only upon the occurrence of a default or any
other extraordinary contingency.
1.02 Accounting Terms and Determinations. Except as otherwise expressly
provided herein or in the Parent Guaranty, all accounting terms used herein
shall be interpreted, and all financial statements and certificates and reports
as to financial matters required to be delivered to the Lender hereunder shall
be prepared, in accordance with GAAP.
1.03 Exchange Rates; Currency Equivalents.
(a) The Lender shall determine the Spot Rates as of each Revaluation
Date to be used for calculating Dollar Equivalent amounts of Loans denominated
in Alternative Currencies. Such Spot Rates shall become effective as of such
Revaluation Date and shall be the Spot Rates employed in converting any amounts
between the applicable currencies until the next Revaluation Date to occur.
Except for purposes of financial statements delivered by the Borrowers hereunder
or calculating financial covenants hereunder (including the Parent Financial
Covenants) or except as otherwise provided herein, the applicable amount of any
currency (other than Dollars) for purposes of the Loan Documents shall be such
Dollar Equivalent amount as so determined by the Lender in its good faith
business judgment.
(b) Wherever in this Agreement in connection with a borrowing,
conversion, continuation or prepayment of a Eurocurrency Rate Loan, an amount,
such as a required minimum or multiple amount, is expressed in Dollars, but such
borrowing or Eurocurrency Rate Loan is denominated in an Alternative Currency,
such amount shall be the relevant Alternative Currency Equivalent of such Dollar
amount (rounded to the nearest unit of such Alternative Currency, with 0.5 of a
unit being rounded upward), as determined by the Lender in its good faith
business judgment.
1.04 Additional Alternative Currencies.
(a) Any Borrower may from time to time request that Loans be made in a
currency other than those specifically listed in the definition of "Alternative
Currency", provided, that (i) payments are made to a Borrower in such other
currency in respect of an Eligible Asset included in the Borrowing Base, and
(ii) such requested currency is a lawful currency (other than Dollars) that is
readily available and freely transferable and convertible into Dollars. Such
request shall be subject to the approval of the Lender in its sole discretion.
(b) Any such request shall be made to the Lender in compliance with the
applicable New Asset/New Jurisdiction/Alternate Currency Requirements.
1.05 Change of Currency. (a) Each obligation of the Borrowers to make a
payment denominated in the national currency unit of any member state of the EMU
that adopts the Euro as its lawful currency after the date hereof shall be
redenominated into Euro at the time of such adoption (in accordance with the EMU
Legislation). If, in relation to the currency of any such member state, the
basis of accrual of interest expressed in this Agreement in respect of that
currency shall be inconsistent with any convention or practice in the London
interbank market for the basis of accrual of interest in respect of the Euro,
such expressed basis shall be replaced by such convention or practice with
effect from the date on which such member state adopts the Euro as its lawful
currency; provided, that if any borrowing in the currency of such member state
is outstanding immediately prior to such date, such replacement shall take
effect, with respect to such borrowing, at the end of the then current Interest
Period.
(b) Each provision of this Agreement shall be subject to such changes
of construction, as specified in clause (a), as the Lender may from time to time
specify to be appropriate to reflect the adoption of the Euro by any member
state of the EMU and any relevant market conventions or practices relating to
the Euro.
(c) Each provision of this Agreement shall also be subject to such
changes of construction, as specified in clause (a), as the Lender may from time
to time specify to be appropriate to reflect a change in currency of any other
country and any relevant market conventions or practices relating to the change
in currency.
1.06 Times of Day. Unless otherwise specified, all references herein to
times of day shall be references to United States Eastern time (daylight or
standard, as applicable).
Section 2. Loans, Note and Prepayments.
2.01 Loans.
(a) Subject to the fulfillment of the conditions precedent set forth in
Sections 4.01 and 4.02 hereof, and provided, that no Default shall have occurred
and be continuing hereunder, the Lender agrees from time to time to make, on the
terms and subject to the conditions of this Agreement, advances to the Borrowers
in an Eligible Currency from time to time, on any Business Day during the
Availability Period, in an aggregate principal amount at any one time
outstanding up to but not exceeding the lesser of (i) the Maximum Credit or (ii)
the Borrowing Base as in effect from time to time; provided, further, that (x)
the aggregate principal amount of all outstanding Loans at any one time shall
not exceed the lesser of (i) the Maximum Credit or (ii) the Borrowing Base, and
(y) the Lender shall not be obligated to make any Loans which, after giving
effect thereto, would result in violation of any applicable Eligible Asset
Funding Requirement.
(b) On any Dollar Equivalent Overadvance Date, at the Lender's sole
discretion, and, provided that no Default shall have occurred and be continuing
hereunder, the Lender may make, on the terms and subject to the conditions of
this Agreement, a Dollar Equivalent Overadvance Loan in an aggregate principal
amount at any one time outstanding up to but not exceeding the Dollar Equivalent
Overadvance Maximum Credit; provided, that (x) any Dollar Equivalent Overadvance
Loan shall be deemed funded in full on the applicable Dollar Equivalent
Overadvance Date and no additional amounts may be borrowed or reborrowed
thereafter, and (y) the amount of such Dollar Equivalent Overadvance Loan shall
not exceed the positive difference between (i) the aggregate amount of the
Dollar Equivalent of the Loans outstanding under this Agreement and (ii) the
Maximum Credit (prior to being increased by the Dollar Equivalent Overadvance
Maximum Credit).
(c) Subject to the terms and conditions of this Agreement and other
than as provided by clause (b) of Section 2.01, during such period each Borrower
may (i) borrow, (ii) repay the Loan, in full or in part, without penalty, and
(iii) reborrow hereunder; provided, that notwithstanding the foregoing, the
Lender shall have no obligation to make Loans to any Borrower in aggregate
amounts in excess of the then current Maximum Credit and, in the event the
obligation of the Lender to make Loans to any Borrower is terminated as
permitted hereunder, the Lender shall have no further obligation to make
additional Loans hereunder.
(d) Promptly upon repayment in full in cash of the Asset Attributable
Loan Balance and upon a Borrower's written request, the Lender shall grant such
Borrower release of the Lender's Lien on such Eligible Asset substantially in
the form provided as Exhibit M (as the same shall be amended, from time to time,
as may be necessary under the laws of the relevant jurisdiction to effect a
complete and unconditional release by the Lender of all its right, title and
interest in, to and under such Eligible Asset) and, effective on such date, such
asset shall thereupon no longer be deemed an Eligible Asset hereunder. All cost
and expenses in connection with all necessary release documents shall be paid by
such Borrower upon demand.
2.02 Evidence of Debt. The Loans made by the Lender shall be evidenced
by one or more accounts or records maintained by the Lender in the ordinary
course of business. The accounts or records maintained by the Lender shall
create a rebuttable presumption that the amount of the Loans made by the Lender
to any of the Borrowers and the interest and payments thereon listed in such
accounts and records are correct. Any failure to so record or any error in doing
so shall not, however, limit or otherwise affect the obligation of any of the
Borrowers hereunder to pay any amount owing with respect to the Obligations.
Upon the request of the Lender to a Borrower, such Borrower shall execute and
deliver to the Lender a Note, substantially in the form of Exhibit A hereto (the
"Notes"), which shall evidence the Lender's Loans to such Borrower in addition
to such accounts or records. The Lender may attach schedules to a Note and
endorse thereon the date, type (if applicable), amount, currency and maturity of
its Loans and payments with respect thereto. The Lender shall have the right to
have its Note subdivided, by exchange for promissory notes of lesser
denominations or otherwise.
2.03 Procedure for Borrowing.
(a) Subject to clause (d) of this Section 2.03, the Borrower Agent may
request a borrowing hereunder (other than a borrowing made pursuant to Section
2.01(b)) on any Business Day during the Availability Period, by delivering to
the Lender a written request for borrowing, substantially in the form of Exhibit
B attached hereto (a "Request for Borrowing"), which request must be received by
the Lender prior to 11:00 a.m., New York City time, three (3) Business Days
prior to the requested Funding Date. Such request for borrowing shall (i)
identify the name of each Borrower requesting a Loan, (ii) identify the amount
requested to be borrowed in respect of each Eligible Asset (and the Applicable
Borrowing Base Percentage for such Eligible Asset), (iii) attach a schedule
identifying the Eligible Assets that the applicable Borrower proposes to be
included in the Borrowing Base in connection with such borrowing, (iv) specify
the requested Funding Date, and (v) attach an officer's certificate signed by a
Responsible Officer of the applicable Borrower as required by Section 4.02(b)
hereof.
(b) Upon a Borrower's request for a borrowing pursuant to Section
2.03(a), the Lender shall, upon satisfaction of all applicable conditions
precedent set forth in Section 4.01 and 4.02 hereof and, provided, that no
Default shall have occurred and be continuing, make a Loan to the applicable
Borrower, in the amount so requested.
(c) Subject to Section 4.02 hereof, such borrowing will then be made
available to the applicable Borrower by the Lender transferring, via wire
transfer, to the account of the applicable Borrower identified on Schedule 2.03
hereto, in the aggregate amount of such borrowing in funds immediately available
to such Borrower.
(d) (i) The Borrower Agent may, from time to time, submit to the Lender
a request to include New Assets into the Borrowing Base in accordance with the
applicable New Asset/New Jurisdiction/Alternate Currency Requirements.
(ii) The Borrower Agent may, from time to time, submit to the Lender
a request to include a New Jurisdiction as an Eligible Jurisdiction in
accordance with the applicable New Asset/New Jurisdiction/Alternate
Currency Requirements.
2.04 Limitation on Types of Loans; Illegality. Anything herein to the
contrary notwithstanding, if, on or prior to the determination of any
Eurocurrency Rate:
(a) the Lender determines, which determination shall be conclusive,
that by reason of circumstances affecting the relevant market, quotations of
interest rates for the relevant deposits referred to in the definition of
"Eurocurrency Rate" in Section 1.01 hereof are not being provided in the
relevant amounts or for the relevant maturities for purposes of determining
rates of interest for Loans as provided herein (as certified by the Lender); or
(b) the Lender determines, which determination shall be conclusive,
that the relevant rate of interest referred to in the definition of
"Eurocurrency Rate" in Section 1.01 hereof upon the basis of which the rate of
interest for Loans is to be determined is not expected adequately to cover the
cost to the Lender of making or maintaining Loans (as certified by the Lender);
or
(c) it becomes unlawful for the Lender to honor its obligation to make
or maintain Loans hereunder using a Eurocurrency Rate (as certified by the
Lender);
then the Lender shall give the Borrower Agent prompt notice thereof and, so long
as such condition remains in effect, (i) in the case of clause (c) of this
Section only, the Lender shall be under no obligation to make additional Loans
and (ii) in the case of clauses (a), (b) and (c) of this Section, the Borrowers
shall either prepay all such Loans as may be outstanding (without additional
cost or penalty but subject to Section 3.04) and this Agreement shall terminate,
or pay interest on such Loans at a rate per annum equal to the Federal Funds
Rate, plus, the Applicable Margin.
2.05 Repayment of Loans; Interest.
(a) The Borrowers hereby promise to repay in full in cash the then
aggregate outstanding principal amount of the Loans on the Termination Date;
provided, that any Dollar Equivalent Overadvance Loan shall be repaid in full in
cash on the Dollar Equivalent Overadvance Maturity Date.
(b) The Borrowers hereby promise to pay to the Lender interest on the
unpaid principal amount of each Loan for the period from and including the date
of such Loan to but excluding the date such Loan shall be paid in full, at a
rate per annum equal to the Eurocurrency Rate plus the Applicable Margin stated
in the definition of "Applicable Margin"; provided, that in no event shall such
rate per annum exceed the maximum rate permitted by law. Notwithstanding the
foregoing, upon the occurrence and during the continuance of an Applicable
Margin Increase Event, the Borrowers hereby promise to pay to the Lender
interest at a rate per annum equal to the Eurocurrency Rate plus the Applicable
Margin stated in the proviso to the definition of "Applicable Margin" on any
principal of any Loan and on any other amount payable by a Borrower hereunder or
under the Note that shall not be paid in full when due (whether at stated
maturity, by acceleration or by mandatory prepayment or otherwise) for the
period from and including the due date thereof to but excluding the date the
same is paid in full. Accrued interest on each Loan shall be payable on each
Payment Date and on the Termination Date, plus (in the case of a Eurocurrency
Rate Loan which is lent from a lending office in the United Kingdom or a
Participating Member State) the Mandatory Cost; provided, that, the Lender may,
in its sole discretion, require accrued interest to be paid simultaneously with
any prepayment of principal made by a Borrower on account of any of the Loans
outstanding. Interest payable at the rate per annum equal to the Eurocurrency
Rate plus the Applicable Margin stated in the proviso to the definition of
"Applicable Margin" shall accrue daily and shall be payable upon such accrual.
Promptly after the determination of any interest rate provided for herein or any
change therein, the Lender shall give notice thereof to the Borrower Agent.
2.06 Prepayments.
(a) (i) Upon the occurrence of a Collateral Value Deficiency Event or
Borrowing Base Deficiency Event, as notified to the Borrower Agent on any
Business Day, the Borrowers shall after receipt of such notice by the Borrower
Agent, prepay the Loans in part or in whole (and such prepayment shall be
applied to the Asset Attributable Loan Balance of (x) the Eligible Assets in
respect of which the Collateral Value Deficiency Event occurred, in the case of
a Collateral Value Deficiency Event, or (y) one or more Eligible Assets
designated by the Borrower Agent, in the case of a Borrowing Base Deficiency
Event) to the Lender (i) in the event such notice was received by the Borrower
Agent on or prior to 11 a.m. on any Business Day, within two (2) Business Days,
or (ii) in the event such notice was received by the Borrower Agent after 11
a.m. on any Business Day, within three (3) Business Days, such that after giving
effect to such prepayment, the aggregate outstanding principal amount of the
Loans does not exceed the Collateral Value or the Borrowing Base, as applicable.
(ii) Upon the occurrence of a Collateral Value Cash Sweep Event, as
notified to the Borrower Agent on any Business Day, the Lender shall be
permitted to apply any Cash in the US Collection Account first, to the
payment of accrued and unpaid interest on the Loans, and then to prepay
the Loans and apply such prepayment to the Asset Attributable Loan
Balance of the Eligible Assets in respect of which the Collateral Value
Cash Sweep Event occurred, such that after giving effect to such
prepayment, the aggregate outstanding principal amount of the Loans
does not exceed the Borrowing Base.
(b) If at any time the aggregate outstanding principal amount of Loans
exceeds the Maximum Credit then in effect, the Borrowers shall at such time
prepay the Loans and such prepayment shall be applied to the Asset Attributable
Loan Balance of one or more Eligible Assets designated by the Borrower Agent
such that, after giving effect to such prepayment, the aggregate outstanding
principal amount of the Loans does not exceed the Maximum Credit then in effect.
(c) If at any time any Borrower shall receive any Eligible Asset Net
Cash Proceeds in respect of any Eligible Asset, such Borrower shall make a
prepayment in the Eligible Asset Proceeds Prepayment Amount to be applied to the
applicable Asset Attributable Loan Balance.
(d) If at any time any Borrower shall receive any Underlying Asset Net
Cash Proceeds in respect of any Eligible Asset, such Borrower shall make a
prepayment in the Underlying Asset Proceeds Prepayment Amount to be applied to
the applicable Asset Attributable Loan Balance.
(e) The Borrowers may, at any time and from time to time, prepay the
Loans, in whole or in part, without premium or penalty, and such prepayment
shall be applied to the Asset Attributable Loan Balance of one or more Eligible
Assets designated by the Borrower Agent upon notice to the Lender by the
Borrower Agent prior to 12:00 noon, New York City time, at least two (2)
Business Days prior thereto, specifying the date and amount of prepayment. If
any such notice is given, unless the same may be revoked by the Borrower Agent
prior to 11:00 a.m. on the date of prepayment, the amount specified in such
notice shall be due and payable on the date specified therein, together with any
amounts payable pursuant to Section 3.04 of this Agreement. Partial prepayments
pursuant to this Section shall be a minimum amount, equal to the lesser of (x)
$500,000 and (y) the then outstanding principal balance of the Loans.
2.07 Extension of Termination Date.
At the written request of the Borrower Agent made in no event earlier
than sixty (60) days prior to the then current Termination Date, the Lender may
in its sole discretion extend the Termination Date (each, a "Termination Date
Extension") for a period of 364 days from the date of effectiveness of such
extension by giving written notice of such extension to the Borrower Agent no
later than 30 days prior to the then current Termination Date; provided, that
(a) the Borrower Agent may request no more than two (2) Termination Date
Extensions, (b) at the time the Lender agrees to such extension and on the
effective date of such Termination Date Extension, no Event of Default has
occurred and is continuing, and (c) on or prior to the effective date of such
Termination Date Extension, the Lender shall have received from the Borrowers
any applicable fees payable pursuant to the Fee Letter. Any such extension shall
be effective on the date that notice of any such extension is given by the
Lender. Any failure by the Lender to deliver such notice of extension shall be
deemed to be the Lender's determination not to extend the then current
Termination Date.
2.08 Repayment of Outstanding Loans after Termination Date.
Effective as of the Termination Date, no further borrowings may be made
by any Borrower under this Loan Agreement and the Obligations then outstanding
(including any amounts payable pursuant to the Fee Letter and Section 3.03)
shall be due and payable in full on such Termination Date.
2.09 Taxes.
(a) For purposes of applying this Section 2.09, the term "Lender" shall
include any assignee, successor or transferee of or to a Lender's rights or
obligations under this Agreement, but only to the extent that the resulting
obligations of each Borrower are no less favorable to such Borrower than the
obligations to which such Borrower would have been subject but for the related
assignment, succession or transfer.
(b) Any and all payments by each Borrower under or in respect of this
Agreement shall be made free and clear of, and without deduction or withholding
for or on account of, any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities (including penalties,
interest and additions to tax) with respect thereto, whether now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental Authority
(collectively, "Taxes"), unless such Taxes represent a Requirement of Law. If
any Borrower shall be required under any applicable Requirement of Law to deduct
or withhold any Taxes from or in respect of any sum payable under or in respect
of this Agreement to the Lender, (i) such Borrower shall make all such
deductions and withholdings in respect of Taxes, (ii) such Borrower shall pay
the full amount deducted or withheld in respect of Taxes to the relevant
taxation authority or other Governmental Authority in accordance with the
applicable Requirement of Law, and (iii) the sum payable by such Borrower shall
be increased as may be necessary so that after such Borrower has made all
required deductions and withholdings (including deductions and withholdings
applicable to additional sums payable under this Section) such Lender receives
an amount equal to the sum it would have received had no such deductions or
withholdings been made in respect of Non-Excluded Taxes, provided that in the
case of amounts payable by an Irish Borrower to a Lender, that Lender is a
Qualifying Lender. For purposes of this Agreement, the term "Non-Excluded Taxes"
are Taxes other than, in the case of the Lender, Taxes that are imposed as a
result of any present or former connection between the Lender and the relevant
taxing jurisdiction, unless such Taxes are imposed solely as a result of such
Lender having executed, delivered or performed its obligations or received
payments under, or enforced, this Agreement (in which case such Taxes shall be
treated as Non-Excluded Taxes).
(c) In addition, each Borrower hereby agrees to pay any present or
future stamp, recording, documentary, excise, property or value-added taxes, or
similar taxes, charges or levies that arise from any payment made under or in
respect of this Agreement or from the execution, delivery or registration of,
any performance under, or otherwise with respect to, this Agreement
(collectively, "Other Taxes").
(d) Each Borrower hereby agrees to indemnify the Lender, and to hold it
harmless against, the full amount of Non-Excluded Taxes and Other Taxes, and the
full amount of Taxes of any kind imposed by any jurisdiction on amounts payable
to Lender under this Section, imposed on or paid by the Lender, and any
liability (including penalties, additions to tax, interest and expenses) arising
therefrom or with respect thereto. The indemnity by each Borrower provided for
in this Section 2.09(d) shall apply and be made whether or not the Non-Excluded
Taxes or Other Taxes for which indemnification hereunder is sought have been
correctly or legally asserted. Amounts payable by each Borrower under the
indemnity set forth in this Section 2.09(d) shall be paid within 30 days from
the date on which the Lender makes written demand therefor.
(e) As soon as practicable after the date of any payment of Taxes or
Other Taxes by each Borrower to the relevant Governmental Authority, such
Borrower shall deliver to the Lender the original or a certified copy of the
receipt issued by such Governmental Authority evidencing payment thereof.
(f) For the purposes of this Section 2.09(f), the terms "United States"
and "United States person" shall have the meanings specified in Section 7701 of
the Code. Any Lender that either (i) is not incorporated under the laws of the
United States, any State thereof, or the District of Columbia or (ii) whose name
does not include "Incorporated," "Inc.," "Corporation," "Corp.," "P.C.,"
"insurance company," or "assurance company" (a "Non-Exempt Lender") shall
deliver or cause to be delivered to the Borrowers either of the following
properly completed and duly executed documents:
(i) in the case of a Non-Exempt Lender that is not a United States
person, a complete and executed (x) U.S. Internal Revenue Form W-8BEN
with Part II completed in which the Lender claims the benefits of a tax
treaty with the United States providing for a zero or reduced rate of
withholding (or any successor forms thereto), including all appropriate
attachments or (y) a U.S. Internal Revenue Service Form W-8ECI (or any
successor forms thereto); or
(ii) in the case of an individual, (x) a complete and executed U.S.
Internal Revenue Service Form W-8BEN (or any successor forms thereto)
and a Tax Certificate or (y) a complete and executed U.S. Internal
Revenue Service Form W-9 (or any successor forms thereto); or
(iii) in the case of a Non-Exempt Lender that is organized under the
laws of the United States, any State thereof, or the District of
Columbia, a complete and executed U.S. Internal Revenue Service Form
W-9 (or any successor forms thereto), including all appropriate
attachments; or
(iv) in the case of a Non-Exempt Lender that (x) is not organized
under the laws of the United States, any State thereof, or the District
of Columbia and (y) is treated as a corporation for U.S. federal income
tax purposes, a complete and executed U.S. Internal Revenue Service
Form W-8BEN claiming a zero rate of withholding (or any successor forms
thereto) and a Tax Certificate; or
(v) in the case of a Non-Exempt Lender that (A) is treated as a
partnership or other non-corporate entity, and (B) is not organized
under the laws of the United States, any State thereof, or the District
of Columbia, (x)(i) a complete and executed U.S. Internal Revenue
Service Form W-8IMY (or any successor forms thereto) (including all
required documents and attachments) and (ii) a Tax Certificate, and (y)
without duplication, with respect to each of its beneficial owners and
the beneficial owners of such beneficial owners looking through chains
of owners to individuals or entities that are treated as corporations
for U.S. federal income tax purposes (all such owners, "beneficial
owners"), the documents that would be required by clause (i), (ii),
(iii), (iv), (vi), (vii) and/or this clause (v) with respect to each
such beneficial owner if such beneficial owner were Lender, provided,
however, that no such documents shall be required with respect to a
beneficial owner to the extent the actual Lender is determined to be in
compliance with the requirements for certification on behalf of its
beneficial owner as may be provided in applicable U.S. Treasury
regulations, or the requirements of this clause (v) are otherwise
determined to be unnecessary, all such determinations under this clause
(v) to be made in the sole discretion of the Borrowers, provided,
however, that Lender shall be provided an opportunity to establish such
compliance as reasonable; or
(vi) in the case of a Non-Exempt Lender that is disregarded for U.S.
federal income tax purposes, the document that would be required by
clause (i), (ii), (iii), (iv), (v), (vii) and/or this clause (vi) of
this Section 2.09(f) with respect to its beneficial owner if such
beneficial owner were the Lender; or
(vii) in the case of a Non-Exempt Lender that (A) is not a United
States person and (B) is acting in the capacity as an "intermediary"
(as defined in U.S. Treasury Regulations), (x)(i) a U.S. Internal
Revenue Service Form W-8IMY (or any successor form thereto) (including
all required documents and attachments) and (ii) a Tax Certificate, and
(y) if the intermediary is a "non-qualified intermediary" (as defined
in U.S. Treasury Regulations), from each person upon whose behalf the
"non-qualified intermediary" is acting the documents that would be
required by clauses (i), (ii), (iii), (iv), (v), (vi), and/or this
clause (vii) with respect to each such person if each such person were
Lender.
If the forms referred to above in this Section 2.09(f) that are
provided by the Lender at the time the Lender first becomes a party to this
Agreement or, with respect to a grant of participation, the effective date
thereof, indicate a United States interest withholding tax rate in excess of
zero, withholding tax at such rate shall be treated as Taxes other than
Non-Excluded Taxes ("Excluded Taxes") and shall not qualify as Non-Excluded
Taxes unless and until the Lender provides the appropriate form certifying that
a lesser rate applies, whereupon withholding tax at such lesser rate shall be
considered Excluded Taxes solely for the periods governed by such form.
(g) The Lender hereby confirms that it is a Qualifying Lender. Insofar
as a Borrower is an Irish Borrower, each Lender that is a Qualifying Lender to
whom any interest is payable by such Irish Borrower, shall as soon as
practicable deliver to the Borrower Agent, written confirmation that it is a
Qualifying Lender (a "Qualifying Lender Confirmation"). Each Lender that has
provided a Qualifying Lender Confirmation shall notify the Borrower Agent as
soon as practicable in writing if it ceases to be a Qualifying Lender (a
"Qualifying Lender Revocation"). For the avoidance of doubt, a Lender is not
required to provide a Qualifying Lender Confirmation if it has already provided
a Qualifying Lender Confirmation and it has not since provided a Qualifying
Lender Revocation unless the applicable Borrower receives a written request from
the Irish Revenue Commissioners for information as to such Lender's entitlement
to exemption from withholding tax on Irish source interest. If a Lender ceases
to be a Qualifying Lender (other than as a result of a change in any law, or the
interpretation or application thereof, occurring after the date on which such
Lender became a Lender), all Taxes suffered by such Lender (whether by
deduction, withholding or otherwise) shall not be Non-Excluded Taxes.
(h) If, however, on the date the Lender transferee becomes a party to
this Agreement, the Lender transferor was entitled to indemnification or
additional amounts under this Section 2.09, then, to such extent (and only to
such extent), the term "Non-Excluded Taxes" shall include (in addition to Taxes
that may be imposed in the future or other amounts otherwise includable in
Taxes) such Taxes, if any, applicable with respect to the Lender transferee on
such date and the Lender assignee shall be entitled to additional
indemnification or additional amounts for any other or additional Non-Excluded
Taxes. Any additional Taxes in respect of a Lender that result solely and
directly from a change in the principal office of such Lender shall be treated
as Excluded Taxes unless (A) any such additional Taxes are imposed as a result
of a change in the applicable Requirement of Law, or in the interpretation or
application thereof, occurring after the date of such change or (B) such change
is made pursuant to the terms of Section 2.09(i) or otherwise as a result of a
request therefor by the Borrowers.
(i) For any period with respect to which the Lender has failed to
provide the Borrowers with the appropriate form, certificate or other document
described in Section 2.09(f) (other than (i) if such failure is due to a change
in any law, or in the interpretation or application thereof, occurring after the
date on which a form, certificate or other document originally was required to
be provided or (ii) if such form, certificate or other document otherwise is not
required under Section 2.09(f)), the Lender shall not be entitled to payment or
indemnification under Sections 2.09(b) or (d) with respect to Non-Excluded Taxes
by reason of such failure; provided, however, that should the Lender become
subject to Non-Excluded Taxes because of its failure to deliver a form,
certificate or other document required hereunder, the Borrowers shall take such
steps, at the sole expense of the Lender, as the Lender shall reasonably request
to assist the Lender in recovering such Non-Excluded Taxes.
(j) The Lender hereby agrees that, upon the occurrence of any
circumstances entitling the Lender to additional amounts pursuant to this
Section, the Lender shall use reasonable efforts (consistent with its internal
policy and legal and regulatory restrictions), at the sole expense of the
Borrowers, to designate a different applicable lending office if the making of
such a change would avoid the need for, or materially reduce the amount of, any
such additional amounts that may thereafter accrue and would not be, in the sole
judgment of the Lender, legally inadvisable or commercially or otherwise
disadvantageous to the Lender in any respect.
(k) Without prejudice to the survival of any other agreement of the
Borrowers hereunder, the agreements and obligations of the Borrowers contained
in this Section shall survive the termination of this Agreement. Nothing
contained in this Section shall require the Lender to make available any of its
tax returns or any other information that it deems to be confidential or
proprietary.
2.10 Additional Borrowers. (a) The Borrower Agent may at any time, upon
not less than 15 Business Days' notice from the Borrower Agent to the Lender (or
such shorter period as may be agreed by the Lender in its sole discretion),
propose any entity as an additional borrower (an "Additional Borrower") to
borrow Loans hereunder by delivering to the Lender a Borrower Joinder duly
executed by the applicable Borrower and the Lender; provided, that the Lender
shall have approved such Additional Borrower in its sole discretion (such date
of approval and inclusion as an Additional Borrower, the "Additional Borrower
Effective Date"). The parties hereto acknowledge and agree that prior to any
Additional Borrower becoming entitled to utilize the credit facilities provided
for herein the Lender shall have received such amendments to any Loan Documents
(as applicable), including, but not limited to, an executed Borrower Security
Agreement Addendum, an executed Additional Account Control Agreement, supporting
resolutions, incumbency certificates, appropriate perfection opinions in respect
of any Borrower Security Agreement Addendum and Additional Account Control
Agreement executed by an Additional Borrower and other documents or information,
in form, content and scope satisfactory to the Lender in its sole discretion, as
may be required by the Lender in its sole discretion, and Notes signed by such
Additional Borrower to the extent the Lender so requires. If the Lender agrees
that an Additional Borrower shall be entitled to borrow Loans hereunder, then
promptly following receipt of all such requested resolutions, incumbency
certificates, opinions of counsel and other documents or information, the Lender
shall send a notice (an "Additional Borrower Notice") to the Borrower Agent
specifying the effective date upon which the Applicant Borrower shall constitute
a Additional Borrower for purposes hereof, whereupon the Lender agrees to permit
such Additional Borrower to borrow Loans hereunder, on the terms and conditions
set forth herein, and each of the parties agrees that such Additional Borrower
otherwise shall be a Borrower for all purposes of this Agreement.
(b) The Obligations of the Borrower Agent, AHR Capital and each
Additional Borrower shall be joint and several in nature.
(c) Each Additional Borrower pursuant to this Section 2.10 hereby
irrevocably appoints the Borrower Agent as its agent for all purposes relevant
to this Agreement and each of the other Loan Documents, including (i) the giving
and receipt of notices, (ii) the execution and delivery of all documents,
instruments and certificates contemplated herein and all modifications hereto,
and (iii) the receipt of the proceeds of any Loans made by the Lender, to any
such Additional Borrower hereunder. Any acknowledgment, consent, direction,
certification or other action which might otherwise be valid or effective only
if given or taken by all Borrowers, or by each Borrower acting singly, shall be
valid and effective if given or taken only by the Borrower Agent, whether or not
any such other Borrower joins therein. Any notice, demand, consent,
acknowledgement, direction, certification or other communication delivered to
the Borrower Agent in accordance with the terms of this Agreement shall be
deemed to have been delivered to each Additional Borrower.
(d) The Borrower Agent may from time to time, upon not less than 15
Business Days' notice from the Borrower Agent to the Lender (or such shorter
period as may be agreed by the Lender in its sole discretion), terminate an
Additional Borrower's status as such, provided that there are no outstanding
Loans payable by such Additional Borrower, or other amounts payable by such
Additional Borrower on account of any Loans made to it, as of the effective date
of such termination.
2.11 Appointment of Borrower Agent.
(a) Each Borrower hereby irrevocably appoints and constitutes the
Borrower Agent as its agent to request and receive Loans pursuant to this
Agreement from the Lender in the name of or on behalf of such Borrower. The
Lender may disburse the Loans to such bank account of the Borrower Agent or a
Borrower or otherwise make such Loans to a Borrower as the Borrower Agent may
designate or direct, without notice to any other Borrower. Notwithstanding
anything to the contrary contained herein, the Borrower Agent may at any time
and from time to time require that any Loans to or for the account of any
Borrower be disbursed directly to an operating account of such Borrower.
(b) The Borrower Agent hereby accepts the appointment by the Borrowers
to act as agent of the Borrowers pursuant to this Section 2.11. The Borrower
Agent shall ensure that the disbursement of any Loans to each Borrower requested
or paid to or for the account of any Borrower hereunder, shall be paid to or for
the account of such Borrower.
(c) Each Borrower hereby irrevocably appoints and constitutes the
Borrower Agent as its agent with respect to the Obligations or otherwise under
or in connection with this Agreement and the other Loan Documents.
(d) Any notice, election, representation, warranty, agreement or
undertaking by or on behalf of any other Borrower or by the Borrower Agent shall
be deemed for all purposes to have been made by such Borrower, as the case may
be, and shall be binding upon and enforceable against such Borrower to the same
extent as if made directly by such Borrower.
Section 3. Payments, Computations, etc.
3.01 Establishment of Accounts/Payments.
(a) AHR Capital shall establish the US Collection Account entitled "AHR
Capital BofA Limited Collection Account" for the benefit of the Lender. On each
Payment Date, all funds in the US Collection Account shall be applied to
payments of principal, interest and other amounts to be paid under this
Agreement and the other Loan Documents in accordance with the Custodial and
Payment Application Agreement.
(b) (i) AHR Capital shall establish the English Sub-Collection Account
entitled "AHR Capital BofA Limited Sub-Collection Account" for the benefit of
the Lender.
(ii) Each Borrower and the Borrower Agent shall deposit or cause to
be deposited into the English Sub-Collection Account all payments and
prepayments (including all payments of principal, interest, Eligible
Asset Net Cash Proceeds and Underlying Asset Net Cash Proceeds) on or
in respect of each Eligible Asset within one (1) Business Day after
receipt thereof.
(iii) Each Borrower and the Borrower Agent shall instruct each
Underlying Asset Servicer to deposit all payments to be made to any
Borrower in respect of any Eligible Assets serviced by such Underlying
Asset Servicer into the English Sub-Collection Account pursuant to an
Underlying Asset Servicer Instruction Letter.
(iv) On each English Sub-Collection Account Remittance Date, all
funds in the English Sub-Collection Account shall be deposited into the
US Collection Account in accordance with the applicable Collateral
(England and Wales) Document.
(c) Except to the extent otherwise provided in clauses (a) or (b) of
this Section 3.01, all other payments to be made by each Borrower under this
Agreement and the other Loan Documents, shall be made in Dollars, in immediately
available funds, without deduction, set-off or counterclaim, to the Lender at
the following account maintained by the Lender: Account Name: Corp Funds
Transfer Account, Account No. 1292000883, for the account of Lender, Bank of
America, N.A., ABA No. 111000012, Ref: (Anthracite, type of payment), not later
than 1:00 p.m., New York City time, on the Payment Date or such other date on
which such payment shall become due (and each such payment made after such time
on such due date shall be deemed to have been made on the next succeeding
Business Day). The Borrowers acknowledge that each has no right of withdrawal
from the foregoing account.
(d) Except to the extent otherwise expressly provided herein, if the
Payment Date or other due date of any payment under this Agreement or the Note
would otherwise fall on a day that is not a Business Day, such date shall be
extended to the next succeeding Business Day, and interest shall be payable for
any principal so extended for the period of such extension.
(e) For the avoidance of doubt the Lender agrees that AHR Capital may
maintain the Irish Account (subject to the lien created by the applicable
Collateral (Ireland) Document) for the purposes of discharging the operational
expenses of the Borrower including audit, lawyers and filing fees, which may be
transferred to and from the Irish Account; provided, that the amount on deposit
in the Irish Account shall not exceed an aggregate amount of (euro)250,000
during any calendar year; provided, further that no payments or prepayments made
to any Borrower in respect of any Eligible Assets shall be deposited in the
Irish Account.
3.02 Computations. Interest on the Loans shall be computed on the basis
of a 360-day year for the actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable.
3.03 Requirements of Law.
(a) If the introduction or adoption of or any change (other than any
change by way of the imposition of or increase in reserve requirements included
in the Eurocurrency Rate Reserve Percentage) in any Requirement of Law (other
than with respect to any amendment made to the Lender's certificate of
incorporation and by-laws or other organizational or governing documents) or any
change in the interpretation or application thereof by any Governmental
Authority or compliance by the Lender with any directive (whether or not having
the force of law) from any central bank or other Governmental Authority having
jurisdiction over the Lender made subsequent to the date hereof:
(i) shall subject the Lender to any tax of any kind whatsoever with
respect to this Agreement, the Note or any Loan made by it or change
the basis of taxation of payments to the Lender in respect thereof
(excluding taxes on the Lender's net income or franchise taxes);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans
or other extensions of credit by, or any other acquisition of funds by,
any office of the Lender which is not otherwise included in the
determination of the Eurocurrency Rate hereunder, (except (x) any
reserve requirement contemplated by Section 3.03(c) or (y) the
requirements of (i) the Bank of England and the Financial Services
Authority, (ii) the Irish Financial Services Regulatory Authority or
(iii) the European Central Bank, as reflected in the Mandatory Cost,
other than as set forth below);
(iii) the Mandatory Cost, as calculated hereunder, does not
represent the cost to the Lender of complying with the requirements of
the Bank of England and/or the Financial Services Authority, the
requirements of the Irish Financial Services Regulatory Authority or
the European Central Bank in relation to its making, funding or
maintaining Eurocurrency Rate Loans; or
(iv) shall impose on the Lender any other condition;
and the result of any of the foregoing is to increase the cost to the Lender, by
an amount which the Lender deems to be material, of making, continuing or
maintaining any Loan or to reduce any amount due or owing hereunder in respect
thereof, then, in any such case, the Borrowers shall promptly pay the Lender
such additional amount or amounts as will compensate the Lender for such
increased cost or reduced amount receivable.
(b) If the Lender shall have determined that the adoption of or any
change in any Requirement of Law applicable to the Lender (other than with
respect to any amendment made to the Lender's certificate of incorporation and
by-laws or other organizational or governing documents) regarding capital
adequacy or in the interpretation or application thereof or compliance by the
Lender or any corporation controlling the Lender with any directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the date hereof shall have the effect of reducing
the rate of return on the Lender's or such corporation's capital as a
consequence of its obligations hereunder to a level below that which the Lender
or such corporation could have achieved but for such adoption, change or
compliance by an amount deemed by the Lender to be material, then from time to
time, the Borrowers shall promptly upon written request pay to the Lender such
additional amount or amounts as will compensate the Lender for such reduction;
provided, that such additional amount shall only be payable if the Lender
requires other similarly situated borrowers to pay this additional amount.
(c) Each Borrower shall pay (and the Borrower Agent shall cause the
applicable Borrower to pay) to the Lender, as long as the Lender shall be
required to comply with any reserve ratio requirement or analogous requirement
of any central banking or financial regulatory authority imposed in respect of
the funding of the Eurocurrency Rate Loans, such additional costs (expressed as
a percentage per annum and rounded upwards, if necessary, to the nearest five
decimal places) equal to the actual costs allocated to such Loan by the Lender
(as determined by the Lender in good faith (as defined in Section 1-201 of the
UCC), which determination shall be conclusive), which shall be due and payable
on each Payment Date, provided, that such Borrowers shall have received at least
10 days' prior notice of such additional costs from the Lender. If the Lender
fails to give notice 10 days prior to the relevant Payment Date, such additional
costs shall be due and payable 10 days from receipt of such notice.
(d) If the Lender becomes entitled to claim any additional amounts
pursuant to this Section, it shall promptly notify the Borrower Agent of the
event by reason of which it has become so entitled. As a condition to each
Borrower's liability under this Section 3.03, the Lender shall promptly deliver
to the Borrower Agent a certificate as to the calculation of any additional
amounts payable pursuant to this Section submitted by the Lender to the Borrower
Agent and including any supporting documentation, which certificate shall be
conclusive in the absence of manifest error. The Borrowers shall have the right
to terminate this Agreement upon payment of all Obligations (including all
additional amounts payable pursuant to this Section 3.03).
3.04 Indemnity. The Borrowers agree to indemnify the Lender and to hold
the Lender harmless from any actual loss or expense which the Lender may sustain
or incur as a consequence of the making of an optional prepayment of
Eurocurrency Rate Loans on a day which is not the last day of an Interest Period
with respect thereto. This covenant shall survive the termination of this
Agreement and the payment of Loans and all other amounts payable hereunder.
3.05 Fees. The Borrowers, jointly and severally, agree to pay to the
Lender the fee as described in the Fee Letter, such payments to be made in
Dollars, in immediately available funds, without deduction, set-off or
counterclaim, to the Lender at the account set forth in Section 3.01(c) of this
Agreement.
Section 4. Conditions Precedent.
4.01 Initial Loan. The obligation of the Lender to make its initial
Loan hereunder is subject to the satisfaction, immediately prior to or
concurrently with the making of such Loan, of the condition precedent that the
Lender shall have received all of the following documents, each of which shall
be satisfactory to the Lender and its counsel in form and substance in its sole
discretion:
(a) Loan Documents.
(i) Credit Agreement. This Agreement, duly executed and delivered by
AHR Capital;
(ii) Note. The Note, duly executed and delivered by AHR Capital;
(iii) Parent Pledge Agreement. A Pledge Agreement, duly executed by
Anthracite;
(iv) Borrower Security Agreement. A Borrower Security Agreement,
duly executed by AHR Capital;
(v) Parent Guaranty. The Parent Guaranty, duly executed by
Anthracite;
(vi) Custodial and Payment Application Agreement. The Custodial and
Payment Application Agreement, duly executed by the parties thereto;
(vii) Collection Account Control Agreements. The US Collection
Account Control Agreement and the English Sub-Collection Account Notice
and Acknowledgement of Charge, in each case duly executed by the
parties thereto;
(viii) Intercompany Subordination Agreement. The Intercompany
Subordination Agreement, duly executed by the parties thereto;
(ix) Collateral (England and Wales) Documents. The Collateral
(England and Wales) Documents, in each case duly executed by the
parties thereto;
(x) Collateral (Ireland) Documents. The Collateral (Ireland)
Documents, in each case duly executed by the parties thereto; and
(xi) Fee Letter. A Fee Letter, duly executed by the parties thereto.
(b) Secretary's Certificates. A certificate of each Borrower and
Anthracite, dated the Closing Date, with appropriate insertions and attachments,
satisfactory in form and substance to the Lender, executed by the applicable
Responsible Officer.
(c) Compliance Certificate. A Compliance Certificate, satisfactory in
form and substance to the Lender, executed by the applicable Responsible
Officer.
(d) Corporate Proceedings. A copy of the resolutions, in form and
substance satisfactory to the Lender, of the Board of Directors (or other
correlative body) of each Borrower and Anthracite authorizing (i) the execution,
delivery and performance of this Agreement and the other Loan Documents to which
it is a party, (ii) the borrowings contemplated hereunder and (iii) the granting
by it of the Liens created pursuant to the Collateral Documents, in each case,
as applicable, certified by the Secretary or an Assistant Secretary of each
Borrower and Anthracite as of the Closing Date, which certification shall be in
form and substance satisfactory to the Lender and shall state that the
resolutions thereby certified have not been amended, modified, revoked or
rescinded.
(e) Incumbency Certificates. A certificate of each Borrower and
Anthracite, dated the Closing Date, as to the incumbency and signature of the
officers of such Borrower and Anthracite executing any Loan Document, shall be
satisfactory in form and substance to the Lender, and shall be executed by an
applicable Responsible Officer.
(f) Corporate Documents. True and complete copies of the Organic
Documents of each Borrower and Anthracite, certified as of the Closing Date as
complete and correct copies thereof by the Secretary or an Assistant Secretary
of such Borrower and Anthracite.
(g) Good Standing Certificates. Certificates (where such certificates
are available) dated as of a recent date from the Secretary of State or other
appropriate authority, evidencing the good standing of each Borrower and
Anthracite (i) in the jurisdiction of its organization and (ii) in each other
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires it to qualify as a foreign Person.
(h) Fees. The fees to be received on the Closing Date pursuant to the
Fee Letter and this Agreement (including the fees, costs and expenses of
Lender's counsel).
(i) Pledged Stock; Stock Powers; Pledged Interests; Pledged Notes;
Pledged Chattel Paper. The certificates representing the shares or other equity
interests pledged pursuant to the Parent Pledge Agreement, if any, together with
an undated stock power for each such stock certificate executed in blank by a
duly authorized officer of the pledgor thereof or such certificate duly endorsed
in blank for each such certificate evidencing a limited liability company
interest. Each "Issuer" referred to in the Parent Pledge Agreement shall have
delivered an acknowledgement and consent to such Parent Agreement, executed by a
duly authorized officer of such Issuer, in substantially the form appended to
such Pledge Agreement.
(j) Actions to Perfect Liens. Evidence in form and substance
satisfactory to it that all filings, recordings, registrations and other
actions, including, without limitation, the filing of duly executed financing
statements on form UCC and the appropriate filings with Companies House in
England and the Companies Registration Office in Ireland, necessary or, in the
opinion of the Lender, desirable to perfect the Liens created by this Agreement
shall have been completed.
(k) Lien Searches. The results of a recent search by a Person
satisfactory to the Lender of the Uniform Commercial Code, judgment and tax lien
filings which may have been filed with respect to personal property of
Anthracite, and the results of such search shall be satisfactory to the Lender.
(l) Legal Opinion. Legal opinions of US, English and Irish outside
counsel to AHR Capital and Anthracite which shall cover such matters incident to
the transactions contemplated by this Agreement as the Lender may reasonably
require.
(m) Filings, Registrations, Recordings; Lien Searches. Any documents
(including, without limitation, financing statements) required to be filed,
registered or recorded in order to create, in favor of the Lender, a perfected,
first priority security interest in the Collateral, subject to no Liens other
than those created hereunder, for filing, registration or recording in each
office in each jurisdiction in which such filings, registrations and
recordations are required to perfect such first priority security interest.
(n) Consents, Licenses, Approvals, etc. Copies certified by AHR Capital
and Anthracite, as applicable, of all consents, licenses and approvals, if any,
required in connection with the execution, delivery and performance by AHR
Capital and Anthracite, of, and the validity and enforceability of, the Loan
Documents, which consents, licenses and approvals shall be in full force and
effect.
(o) Eligible Asset Servicer Notice and Agreement. An Eligible Asset
Servicer Notice and Agreement in respect of each Eligible Asset Servicer, which
shall be in form and substance satisfactory to the Lender.
(p) Other Documents. Such other documents as the Lender may reasonably
request.
4.02 Initial and Subsequent Loans. The making of each Loan to a
Borrower (including the initial Loan) on any Business Day is subject to the
satisfaction of the following further conditions precedent, both immediately
prior to the making of such Loan and also after giving effect thereto and to the
intended use thereof:
(a) No Default. No Default or Event of Default shall have occurred and
be continuing.
(b) Representations and Warranties. Both immediately prior to the
making of such Loan and also after giving effect thereto and to the intended use
thereof, the Eligible Jurisdiction Relevant Warranties and the representations
and warranties made by the Borrowers in Section 5 hereof, and elsewhere in each
of the Loan Documents, shall be true and correct in all material respects on and
as of the date of the making of such Loan with the same force and effect as if
made on and as of such date (or, if any such representation or warranty is
expressly stated to have been made as of a specific date, as of such specific
date). The Lender shall have received an officer's certificate from each of the
Borrowers signed by an applicable Responsible Officer thereof certifying as to
the truth and accuracy of the above.
(c) Borrowing Base. No Collateral Value Deficiency Event, Borrowing
Base Deficiency Event or Collateral Value Cash Sweep Event shall have occurred
and be continuing.
(d) New Assets. In the event any New Asset (other than a Table Funded
New Asset) is approved to be included in the Borrowing Base pursuant to Section
2.03(d)(i) hereof and as a condition precedent to the effectiveness of such
approval, the Borrower Agent shall have delivered to the Lender duly authorized
and executed New Asset Legal Documents. On or before each Funding Date with
respect to each Table Funded New Asset, the Borrower Agent shall cause the
settlement agent for such Table Funded New Asset to deliver to the Custodian by
facsimile the related mortgage note, if any, and a settlement agent trust
receipt issued with respect to such Table Funded New Asset.
(e) Fees and Expenses. The Lender shall have received all fees and
expenses due and payable under this Agreement.
(f) Concentration Limits. Each Borrower shall have complied with any
Concentration Limits.
4.03 Underlying Asset Servicer Instruction Letter / UK Custody
Agreement. Each Borrower shall have delivered (a) in the case the initial Loan
made in respect of an Eligible Asset, an Underlying Asset Servicer Instruction
Letter in respect of such Eligible Asset and (b) in the case of the initial Loan
in respect of an Eligible Asset constituting Eligible CMBS Securities, a UK
Custody Agreement, in each case in form and substance satisfactory to the Lender
and duly authorized, executed and delivered on or prior to the date of the
making of such Loan.
Section 5. Representations and Warranties.
Each Borrower represents and warrants to the Lender that throughout the
term of this Agreement:
5.01 Legal Name of Borrowers. Schedule 5.01 lists the exact legal name
of each Borrower, and no Borrower has used any previous names, assumed names or
trade names.
5.02 Existence. Each of the Borrowers (a) is duly organized, validly
existing and in good standing (in the case of a Borrower that can obtain a
certificate of good standing) under the laws of the jurisdiction of its
organization; (b) has all requisite corporate or other power, and has all
governmental licenses, authorizations, consents and approvals necessary to own
its assets and carry on its business as now being or as proposed to be
conducted, except where the lack of such licenses, authorizations, consents and
approvals could not reasonably be expected to cause a Material Adverse Change;
and (c) is qualified to do business and is in good standing (in the case of a
Borrower that can obtain a certificate of good standing) in all other
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary, except where failure so to qualify could not reasonably
be expected (either individually or in the aggregate) to cause a Material
Adverse Change.
5.03 Financial Condition.
(a) As of the Closing Date or any Additional Borrower Effective Date,
as applicable, prior to giving effect to the making of any Loans, no Borrower
shall own any material property, assets, Indebtedness, investments, contractual
obligations or liabilities of any kind, except pursuant to the Loan Documents,
the applicable Organic Documents or the applicable Eligible Asset Documents.
(b) AHR Capital was incorporated on December 5th, 2005, and since such
date has engaged in no business other than activities related to its
organization, its capitalization, and the financing contemplated hereby.
5.04 Litigation. There are no actions, suits, arbitrations,
investigations pending or, to the best of each Borrower's knowledge, threatened
against any Borrower or affecting any of their respective Eligible Assets or
Property that (i) questions or challenges the validity or enforceability of any
of the Loan Documents or any material action to be taken in connection with the
transactions contemplated hereby, (ii) which, individually or in the aggregate,
if adversely determined, may result in a Material Adverse Change, or (iii) to
the extent applicable, requires filing with the SEC in accordance with the 1934
Act or any rules thereunder.
5.05 No Breach. Neither (a) the execution and delivery of the Loan
Documents nor (b) the consummation of the transactions therein contemplated in
compliance with the terms and provisions thereof conflicts with or results in a
breach of the charter or by-laws of any Borrower, or any applicable law
(including, without limitation, Prescribed Laws), rule or regulation, or any
order, writ, injunction or decree of any Governmental Authority, or any
agreement or instrument to which any Borrower is a party or by which any of them
or any of their Property is bound or to which any of them is subject, or
constitute a default under any such agreement or instrument or result in the
creation or imposition of any Lien (except for the Liens created pursuant to
this Agreement) upon any Property of any Borrower pursuant to the terms of any
such agreement or instrument, in each case to the extent that such default,
conflict or breach could reasonably be expected to cause a Material Adverse
Change.
5.06 Action. Each of the Borrowers has all necessary corporate or other
power, authority and legal right to execute, deliver and perform its obligations
under each of the Loan Documents; the execution, delivery and performance by
such Borrower of each of the Loan Documents has been duly authorized by all
necessary corporate or other action on its part; and each Loan Document has been
duly and validly executed and delivered by such Borrower, and constitutes a
legal, valid and binding obligation of such Borrower, enforceable against such
Borrower, in accordance with its terms, subject, as to enforcement, to (i) the
effect of bankruptcy, examination, insolvency or similar laws affecting
generally the enforcement of creditors' rights, as such laws would apply in the
event of any bankruptcy, examination, receivership, insolvency or similar event
applicable to such Borrower, (ii) general equitable principles (whether
enforceability of such principles is considered in a proceeding at law or in
equity), (iii) the making of required registrations, filings and notifications
to perfect any security arrangements created pursuant to any of the Loan
Documents and (iv) any other qualifications as to matters of general law (but
not of fact) set out in legal opinions delivered pursuant to Section 4.01(m).
5.07 Approvals. No authorizations, approvals or consents of, and no
filings or registrations with, any Governmental Authority, any securities
exchange or any other Person are necessary for the execution, delivery or
performance by any Borrower of the Loan Documents or for the legality, validity
or enforceability thereof, except for filings and recordings in respect of the
Liens created pursuant to this Agreement and except for filings required by
applicable law and filings which have been made.
5.08 Margin Regulations. Neither the making of any Loan hereunder, nor
the use of the proceeds thereof, violates the provisions of Regulation U or X.
5.09 Taxes. Each Borrower has filed all income and corporation tax
returns and all other material tax returns that to the knowledge of such
Borrower would be delinquent if they had not been filed on or before the date
hereof and has paid all taxes due pursuant to such returns or pursuant to any
assessment received by any of them, except for any such taxes as are being
appropriately contested in good faith by appropriate proceedings diligently
conducted and with respect to which adequate reserves have been provided.
5.10 Investment Company Act. None of the Borrowers, or any Subsidiary
thereof, is an "investment company", or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended.
5.11 Chief Executive Office/Jurisdiction of Organization. On the
Closing Date, each Borrower's registered office is located at the address
indicated in Schedule 5.11. On the Closing Date, each Borrower's jurisdiction of
organization is as indicated in Schedule 5.11.
5.12 Location of Books and Records. The location where each Borrower
keeps its books and records, including all computer tapes and records relating
to the Collateral is its registered office.
5.13 True and Complete Disclosure. The information, reports, financial
statements, credit approval memos, exhibits and schedules furnished in writing
by or on behalf of each of the Borrowers to the Lender in connection with the
negotiation, preparation or delivery of this Agreement and the other Loan
Documents or included herein or therein or delivered pursuant hereto or thereto,
when taken as a whole, do not contain any untrue statement of material fact or
omit to state any material fact necessary to make the statements herein or
therein, in light of the circumstances under which they were made, not
misleading. All written information furnished after the date hereof by or on
behalf of each of the Borrowers, to the Lender in connection with this Agreement
and the other Loan Documents and the transactions contemplated hereby and
thereby is true, complete and accurate in every material respect, or (in the
case of projections) based on reasonable estimates, on the date as of which such
information is stated or certified. There is no fact known to any Responsible
Officer of any of the Borrowers, after due inquiry, that could be reasonably
expected to cause a Material Adverse Change that has not been disclosed herein,
in the other Loan Documents or in a report, financial statement, exhibit,
schedule, disclosure letter or other writing furnished to the Lender for use in
connection with the transactions contemplated hereby or thereby.
5.14 ERISA. No Borrower (a) has any Plans or any ERISA Affiliates or
(b) makes any contributions to any Plans or any Multiemployer Plans.
5.15 Regulatory Status. No Borrower is a "bank holding company" or a
direct or indirect subsidiary of a "bank holding company" as defined in the Bank
Holding Company Act of 1956, as amended, and Regulation Y thereunder of the
Board of Governors of the Federal Reserve System.
5.16 Solvency. After giving effect to each Loan and including
consideration of the Parent Guaranty each of the Borrowers is Solvent.
5.17 Eligible Assets. The Eligible Jurisdiction Relevant Warranties are
incorporated as if fully set forth herein.
5.18 Representations as to Jurisdiction of Domicile of Borrowers. Each
Borrower represents and warrants to the Lender that:
(a) Such Borrower is subject to applicable civil and commercial laws
with respect to its obligations under this Agreement and the other Loan
Documents to which it is a party (collectively as to such Borrower, the
"Applicable Borrower Documents"), and the execution, delivery and performance by
such Borrower of the Applicable Borrower Documents constitute and shall
constitute private and commercial acts and not public or governmental acts.
Neither such Borrower nor any of its property has any immunity from jurisdiction
of any court or from any legal process (whether through service or notice,
attachment prior to judgment, attachment in aid of execution, execution or
otherwise) under the laws of the jurisdiction in which such Borrower is
organized and existing in respect of its obligations under the Applicable
Borrower Documents.
(b) The Applicable Borrower Documents are in proper legal form under
the Laws of the jurisdiction in which such Borrower is organized and existing
for the enforcement thereof against such Borrower under the Laws of such
jurisdiction, and to ensure the legality, validity, enforceability, priority or
admissibility in evidence of the Applicable Borrower Documents, subject to (a)
the principle that the equitable remedies may be granted or refused at the
discretion of a court and the limitation of enforcement by laws relating to
insolvency, reorganisation and other laws affecting the rights of creditors
generally, (b) the time barring of claims, the possibility that an undertaking
to assume liability for an indemnity of a person against non-payment of stamp
duty may be void and defenses of set-off or counterclaim and (c) any other
qualifications as to matters of general law (but not of fact) set out in legal
opinions delivered pursuant to Section 4.01(m). Other than filing Forms C-1 in
the Companies Registration Office in Ireland within 21 days of the creation of
the Irish Debenture and each of the security documents entered into by the Irish
Borrower, the filing of a Form 8-E in the Companies Registration Office in
Ireland within 21 days of the creation of the Parent Deed of Charge, the payment
of stamp duty to the Irish Revenue Commissioners within 30 days of the execution
of each of the Parent Deed of Charge and the Irish Debenture in the amount of
(euro)630 for the Irish Debenture, (euro)12.50 (marked collateral) for the
Parent Deed of Charge and each of the security documents entered into by the
Irish Borrower and (euro)12.50 for each counterpart and the payment of nominal
court duty (where such payment is required) on any documents submitted to court
as part of any enforcement proceedings, it is not necessary to ensure the
legality, validity, enforceability (subject as aforesaid), priority or
admissibility in evidence of the Applicable Borrower Documents that the
Applicable Borrower Documents be filed, registered or recorded with, or executed
or notarized before, any court or other authority in the jurisdiction in which
such Borrower is organized and existing or that any registration charge or stamp
or similar tax be paid on or in respect of the Applicable Borrower Documents or
any other document, except for (i) any such filing, registration, recording,
execution or notarization as has been made and (ii) any charge or tax as has
been timely paid.
(c) Provided that the Lender is a Qualifying Lender, there is no tax,
levy, impost, duty, fee, assessment or other governmental charge, or any
deduction or withholding, imposed by any Governmental Authority in or of the
jurisdiction in which such Borrower is organized and existing either (i) on or
by virtue of the execution or delivery of the Applicable Borrower Documents or
(ii) on any payment to be made by such Borrower pursuant to the Applicable
Borrower Documents, except as has been disclosed to the Lender in writing.
(d) The execution, delivery and performance of the Applicable Borrower
Documents executed by such Borrower are, under applicable foreign exchange
control regulations of the jurisdiction in which such Borrower is organized and
existing, not subject to any notification or authorization except (i) such as
have been made or obtained or (ii) such as cannot be made or obtained until a
later date (provided, that any notification or authorization described in clause
(ii) shall be made or obtained as soon as is reasonably practicable).
(e) The representations and warranties made in this Section 5.18 shall
in addition to, any representations and warranties made pursuant to any
Collateral (England and Wales) Document, Collateral (Federal Republic of
Germany) Document, Collateral (Ireland) Document and Collateral (Other Eligible
Jurisdiction) Document.
5.19 Subsidiaries. No Borrower has any Subsidiaries.
5.20 Separateness. Each Borrower (a) does not own any assets, or engage
in any business, other than the assets and transactions specifically
contemplated by this Agreement; (b) has not incurred any Indebtedness other than
as permitted under this Agreement; (c) has not made any Investments (other than
the Eligible Assets and assets that may be acquired in any foreclosure on, or
after realization of collateral from, any of the Eligible Assets that is a
mezzanine loan); (d) has paid its debts and liabilities (including, as
applicable, shared personnel and overhead expenses) only from its own assets;
(e) complies with the provisions of its organizational documents; (f) does all
things necessary to observe organizational formalities and to preserve its
existence; (g) maintains all of its books, records, financial statements and
bank accounts separate from those of its Affiliates (provided, that it may
permit its assets to be included in a consolidated financial statement of an
Affiliate; provided, further, that in respect of such assets, (i) appropriate
notation shall be made on such consolidated financial statements to indicate the
separateness of it from such Affiliate and to indicate that its assets and
credit are not available to satisfy the debts and other obligations of such
Affiliate or any other Person and (ii) such assets shall also be listed on its
own separate balance sheet); (h) is, and at all times holds itself out to the
public as, a legal entity separate and distinct from any other entity (including
any Affiliate), corrects any known misunderstanding regarding its status as a
separate entity, conducts business in its own name, does not identify itself or
any of its Affiliates as a division or part of the other and maintains and
utilizes separate invoices and checks; (i) does not engage in or suffer any
dissolution, winding up, liquidation, consolidation or merger in whole or in
part; (j) does not commingle its funds or other assets with those of any
Affiliate or any other Person; (k) maintains its assets in such a manner that it
will not be costly or difficult to segregate, ascertain or identify its
individual assets from those of any Affiliate or any other Person; (l) does not
hold itself out to be responsible for the debts or obligations of any other
Person; (m) has not (i) filed or consented to the filing of any bankruptcy,
insolvency or reorganization case or proceeding with respect to such Borrower;
instituted any proceedings under any applicable insolvency law or otherwise
sought any relief under any laws relating to the relief from debts or the
protection of debtors generally with respect to such Borrower; (ii) sought or
consented to the appointment of a receiver, liquidator, Examiner, assignee,
trustee, sequestrator, custodian or any similar official for such Borrower or a
substantial portion of its properties; or (iii) made any assignment for the
benefit of such Borrower's creditors and (n) does not have any employees or own,
rent, lease or be in possession of any buildings or equipment.
5.21 Irish Borrower Tax Requirements.
(a) For as long as a Borrower is an Irish Borrower, such Borrower
satisfies the Irish Borrower Tax Requirements.
(b) For as long as each Additional Borrower is, on or after the
Additional Borrower Effective Date, an Irish Borrower, such Additional Borrower
satisfies the Irish Borrower Tax Requirements.
Section 6. Covenants.
Each Borrower and the Borrower Agent, as applicable, covenants and
agrees with the Lender that, so long as any Loan is outstanding and until
payment in full of all Obligations:
6.01 Financial Statements. The Borrower Agent shall deliver to the
Lender:
(a) as soon as available and in any event within forty-five (45) days
after the end of each of the first three quarterly fiscal periods of each fiscal
year of Anthracite, the unaudited consolidated balance sheet of Anthracite and
its consolidated Subsidiaries as at the end of such period and the related
unaudited consolidated statement of income and retained earnings, consolidated
statement of cash flows and consolidated statement of equity for Anthracite and
its consolidated Subsidiaries for such period and the portion of the fiscal year
through the end of such period, setting forth in each case in comparative form
the figures for the previous year, accompanied by a certificate of a Responsible
Officer of Anthracite, which certificate shall state that said consolidated
financial statements fairly present the consolidated financial condition and
results of operations of Anthracite and its consolidated Subsidiaries in
accordance with GAAP, consistently applied, as at the end of, and for, such
period (subject to normal year-end audit adjustments);
(b) as soon as available and in any event within ninety (90) days after
the end of each fiscal year of Anthracite, the consolidated balance sheet of
each Anthracite and its consolidated Subsidiaries as at the end of such fiscal
year and the related consolidated statement of income and retained earnings,
consolidated statement of cash flows and consolidated statement of equity for
Anthracite and its consolidated Subsidiaries for such year, setting forth in
each case in comparative form the figures for the previous year, accompanied by
an opinion thereon of independent certified public accountants of recognized
national standing, which opinion shall not be qualified as to scope of audit or
going concern and shall state that said consolidated financial statements fairly
present the consolidated financial condition and results of operations of
Anthracite and its consolidated Subsidiaries as at the end of, and for, such
fiscal year in accordance with GAAP;
(c) from time to time such other information regarding the Eligible
Assets, the Borrowing Base, the Collateral Value, financial condition,
operations, or business of each Borrower and its Subsidiaries as the Lender may
reasonably request (in each case to the extent available), including, but not
limited to, the following:
(i) With respect to each Eligible Mezzanine Loan or Eligible
B Note:
(A) within 30 days after each quarter end, a servicing
remittance report (or the equivalent thereof);
(B) to the extent required by any underlying loan documents
and available to a Borrower, within 30 days after each quarter end,
the unaudited monthly financial statements and rent rolls for each
underlying mortgagor; and
(C) to the extent required by any underlying loan documents
and available to a Borrower, within 45 days after the last day of
each fiscal quarter of each mortgagor and 90 days after the last day
of each fiscal year of each mortgagor, unaudited certified quarterly
financial statements and audited annual financial statements,
respectively, of such mortgagor; and
(D) at each quarter end, a report containing the Quarterly
Servicing Information set forth on Schedule 6.01(a) hereto; and
(E) within 30 days after each quarter end, to the extent as
requested by the Lender, a report containing the Eligible Asset
Information set forth on Schedule 6.01(b) hereto.
(ii) With respect to each Eligible CMBS Security:
(A) within 30 days after each quarter end, a trustee report
in form satisfactory to the Lender;
(B) within 30 days after each quarter end, a remittance
report in form satisfactory to the Lender;
(C) within 30 days after each fiscal quarter of each
Borrower, a report detailing all dealer valuations received by such
Borrower in form satisfactory to the Lender; and
(D) within 30 days after each fiscal quarter of each
Borrower, a report detailing all internal valuations performed by
such Borrower in determining the value of such Eligible CMBS
Security.
(iii) promptly following the implementation of any
Underwriting Guidelines, a true and correct copy of such
Underwriting Guidelines.
(d) promptly following any Borrower obtaining knowledge of any event
which, if such event had occurred and was continuing both immediately prior to
the making of any Loan and after giving effect thereto, would cause any of the
Eligible Jurisdiction Relevant Warranties to be non-compliant with Section
4.02(b), all information actually known by any Borrower relating to such event.
The Borrower Agent shall furnish to the Lender, at the time it
furnishes each set of financial statements pursuant to paragraphs (a) and (b)
above, (i) a certificate of a Responsible Officer of each Borrower stating that,
to the best of such Responsible Officer's knowledge, the applicable Borrower
during such fiscal period or year has observed or performed all of its covenants
and other agreements, and satisfied every condition, contained in this Agreement
and the other Loan Documents to be observed, performed or satisfied by it, and
that such Responsible Officer has obtained no knowledge of any Default or Event
of Default except as specified in such certificate (and, if any Default or Event
of Default has occurred and is continuing, describing the same in reasonable
detail and describing the action the applicable Borrower has taken or proposes
to take with respect thereto) and (ii) a Compliance Certificate showing in
detail the calculations supporting such Responsible Officer's certification of
Anthracite's compliance with the Parent Financial Covenants.
(e) promptly following the appointment of any new Underlying Asset
Servicer, an updated Schedule 1-F.
6.02 Irish Borrower Tax Requirements
(a) For as long as any Borrower is an Irish Borrower, such Borrower
shall fulfill the Irish Borrower Tax Requirements.
(b) For as long as each Additional Borrower is, on or after the
Additional Borrower Effective Date, an Irish Borrower, such Additional Borrower
shall fulfill the Irish Borrower Tax Requirements. 6.03 Litigation. The Borrower
Agent shall promptly, and in any event within five (5) Business Days after
obtaining actual knowledge of any of the following, give to the Lender notice of
all litigations, actions, suits, arbitrations, investigations (including,
without limitation, any of the foregoing which are pending or threatened) or
other legal or arbitrable proceedings affecting any Borrower affecting any
Eligible Asset or Property of any of them that (i) question or challenge the
validity or enforceability of any of the Loan Documents or any action to be
taken in connection with the transactions contemplated hereby, (ii) involve a
claim for failure pay any amounts due and payable under any Eligible Assets,
(iii) individually or in the aggregate, if adversely determined, may result in a
Material Adverse Change, or (iv) require filing with the SEC in accordance with
the 1934 Act and any rules thereunder.
6.04 Purpose of Loans. The Borrowers shall use the proceeds of the
Loans for the acquisition of the Eligible Assets and the payment of (i) any fees
and expenses incurred in the ordinary course of business in connection
therewith, (ii) any other expenses incurred in the ordinary course of business
and such other amounts as permitted hereby, (iii) any fees and expenses due
hereunder and (iv) any ordinary expenses incurred in connection with the closing
of the transactions contemplated hereby; provided, that the Loans shall not be
used for the purchase or acquisition, or as collateral related to the purchase
or acquisition, by or at the request of the Borrowers or any Subsidiary or
Affiliate of the Borrowers of securities or other assets issued or owned by Banc
of America Securities LLC or any of its Affiliates except Bank of America, N.A.
and its subsidiaries.
6.05 Changes to Accounting and Reporting Practices. Each of the
Borrowers and Anthracite shall at all times keep proper books of records and
accounts in which full, true and correct entries shall be made of its
transactions in accordance with GAAP and set aside on its books from its
earnings for each fiscal year all such proper reserves in accordance with GAAP.
6.06 Required Filings. The Borrower Agent shall promptly provide the
Lender with copies of all documents which Anthracite or any Borrower is required
to file with the SEC in accordance with the 1934 Act or any rules thereunder.
6.07 Existence, etc.
Each of the Borrowers shall:
(a) preserve and maintain (i) its legal existence, (ii) all of its
material rights, privileges, licenses and franchises, and (iii) maintain its tax
residence in Ireland;
(b) comply with the requirements of all applicable laws, rules,
regulations and orders of Governmental Authorities (including, without
limitation, Prescribed Laws and all environmental laws) if failure to comply
with such requirements would be reasonably likely (either individually or in the
aggregate) to cause a Material Adverse Change;
(c) not move its registered office from the address referred to in
Section 5.11 or change its jurisdiction of organization or incorporation from
the jurisdiction referred to in Section 5.11 unless it shall have provided the
Lender 15 Business Days' prior written notice of such change;
(d) pay and discharge, prior to the date on which penalties attach
thereto, all taxes, assessments and governmental charges or levies imposed on it
or on its income or profits or on any Eligible Asset or Property, which in any
manner would create any lien or charge on the Eligible Assets, except for any
such tax, assessment, charge or levy the payment of which is being contested in
good faith and by proper proceedings and against which adequate reserves are
being maintained in conformance with GAAP; and
(e) permit representatives of the Lender upon reasonable prior written
notice, during normal business hours and prior to the occurrence and continuance
of an Event of Default, to examine, copy and make extracts from its books and
records, to inspect any of its Properties, and to discuss its business and
affairs with its officers, all to the extent reasonably requested by the Lender
and subject to the terms of any applicable confidentiality agreement.
6.08 Notices. The Borrower Agent shall give notice to the Lender:
(a) promptly upon receipt of notice or actual knowledge of the
occurrence of any Default or Event of
Default.
(b) promptly upon receipt of notice or actual knowledge of (i) any
default related to any Eligible Assets, (ii) any Lien or security interest
(other than security interests created hereby or by the other Loan Documents)
on, or claim asserted against, the Lender's or any Borrowers interest in any of
the Eligible Assets or (iii) any event or change in circumstances which could
reasonably be expected to cause a Material Adverse Change.
(c) promptly upon the occurrence of a default for which written notice
has been delivered to the Borrower Agent under the applicable Eligible Asset
Document relating to an Eligible Asset.
Each notice pursuant to this Section shall be accompanied by a
statement of a Responsible Officer of the Borrower Agent setting forth details
of the occurrence referred to therein and stating what action the Borrower Agent
or a Borrower has taken or proposes to take with respect thereto.
6.09 Prohibition of Fundamental Changes. Each of the Borrowers shall
not enter into any transaction of merger or consolidation or amalgamation, or
liquidate, wind up or dissolve itself (or suffer any liquidation, winding up or
dissolution) or sell all or substantially all of its assets.
6.10 Transactions with Affiliates. Other than capital contributions and
distributions permitted under its organizational documents and transactions
otherwise contemplated under the Loan Documents but not prohibited thereunder,
no Borrower shall enter into any transaction, contract or agreement with any of
its Affiliates, except upon terms and conditions that are substantially similar
to those that would be available on an arm's length basis with Persons other
than any Affiliates (it being understood that, notwithstanding anything
contained in this Section 6.10, the delivery of the Parent Guaranty shall not be
prohibited hereunder).
6.11 Limitation on Indebtedness. No Borrower shall create, incur,
assume or suffer to exist any Indebtedness, other than:
(a) Indebtedness outstanding pursuant to this Agreement and the other
Loan Documents;
(b) Permitted Hedge Obligations;
(c) unsecured Indebtedness of any Borrower owing to any Blackrock
Entity, Anthracite or any of their respective Subsidiaries that has previously
executed and delivered to the Lender the Intercompany Subordination Agreement;
and
(d) unsecured trade payables, in an aggregate amount not to exceed
$1,000,000 at any one time outstanding, incurred in the ordinary course of
acquiring, owning, financing and disposing of Eligible Assets; provided,
however, that any such trade payables incurred by any Borrower shall be paid
within 30 days of the date incurred.
6.12 Limitation on Liens. No Borrower shall create, incur, assume or
suffer to exist any Lien on any Eligible Assets, Property or revenues, whether
now owned or hereafter acquired by it, other than:
(a) Liens created pursuant to pursuant to this Agreement and the other
Loan Documents;
(b) Liens for taxes, assessments or other governmental charges or
levies not yet subject to penalties or which are being contested in good faith
and for which adequate reserves have been established by such Borrower in
accordance with GAAP; and
(c) Liens arising out of judgments or orders which do not constitute an
Event of Default under Section 7(e) and for which adequate reserves have been
established by such Borrower in accordance with GAAP.
6.13 Limitation on Distributions. No Borrower shall make any Restricted
Payments after the occurrence and during the continuance of an Event of Default.
6.14 Limitation on Investments. No Borrower shall own or hold any other
substantial property or assets or make any Investment, except in respect of
Eligible Assets and assets that may be acquired in any foreclosure on, or other
realization of collateral from, any of the Eligible Assets that is a mezzanine
loan.
6.15 Lines of Business. No Borrower shall engage in any activity other
than (a) acquiring, owning, disposing of and otherwise managing the Eligible
Assets, and (b) activities necessary, suitable or appropriate to accomplish the
foregoing or incidental thereto, and shall not make any material change in its
general lines of business existing as of the Closing Date or the Additional
Borrower Effective Date, as applicable.
6.16 Separateness. Each Borrower shall (a) own no material assets, and
engage in no business, other than the assets and transactions specifically
contemplated by this Agreement; (b) not incur any Indebtedness other than as
permitted pursuant to this Agreement; (c) not make any Investments other than
the Eligible Assets and assets that may be acquired in any foreclosure on, or
other realization of collateral from, any of the Eligible Assets that is a
mezzanine loan; (d) pay its debts and liabilities (including, as applicable,
shared personnel and overhead expenses) only from its own assets; (e) comply
with the provisions of its organizational documents; (f) do all things necessary
to observe organizational formalities and to preserve its existence, and shall
not amend, modify or otherwise change its organizational documents, or suffer
same to be amended, modified or otherwise changed, without the prior written
consent of the Lender; (g) maintain all of its books, records, financial
statements and bank accounts separate from those of its Affiliates (provided,
that it may permit its assets to be included in a consolidated financial
statement of an Affiliate; provided, further, that in respect of such assets,
(i) appropriate notation shall be made on such consolidated financial statements
to indicate the separateness of it from such Affiliate and to indicate that its
assets and credit are not available to satisfy the debts and other obligations
of such Affiliate or any other Person and (ii) such assets shall also be listed
on its own separate balance sheet); (h) be, and at all times shall hold itself
out to the public as, a legal entity separate and distinct from any other entity
(including any Affiliate), shall correct any known misunderstanding regarding
its status as a separate entity, shall conduct business in its own name, shall
not identify itself or any of its Affiliates as a division or part of the other
and shall maintain and utilize a separate invoices and checks; (i) not engage in
or suffer any dissolution, winding up, liquidation, consolidation or merger in
whole or in part; (j) not commingle its funds or other assets with those of any
Affiliate or any other Person; (k) maintain its assets in such a manner that it
will not be costly or difficult to segregate, ascertain or identify its
individual assets from those of any affiliate or any other Person; (l) not and
will not hold itself out to be responsible for the debts or obligations of any
other Person; (m) not (i) file or consent to the filing of any bankruptcy,
insolvency or reorganization case or proceeding with respect to such Borrower;
institute any proceedings under any applicable insolvency law or otherwise seek
any relief under any laws relating to the relief from debts or the protection of
debtors generally with respect to such Borrower; (ii) seek or consent to the
appointment of a receiver, liquidator, Examiner, assignee, trustee,
sequestrator, custodian or any similar official for such Borrower or a
substantial portion of its properties; or (iii) make any assignment for the
benefit of such Borrower's creditors and (n) not have any employees or own,
rent, lease or be in possession of any buildings or equipment.
6.17 Subsidiaries. No Borrower shall form or acquire any Subsidiaries.
6.18 Independent Directors. Each Borrower shall at all times cause
there to be not more than five (5) members of the board of directors of which at
least one duly appointed member of such Borrower's board of directors, as
applicable (an "Independent Director") shall be an Independent Director which
shall not have been at the time of initial appointment or at any time while
serving as an Independent Director, and shall not have been at any time during
the preceding five years (i) a stockholder, officer, employee, partner, attorney
or counsel of such Borrower or any Affiliate of such Borrower, (ii) a Person or
other entity controlling or under common control with any such stockholder,
partner, customer, supplier or other Person or (iii) a member of the immediate
family of any such stockholder, member of the board of managers, officer,
employee, partner, customer, supplier or other Person. As used in this Section
6.18, the term "control" means the possession, directly or indirectly, or the
power to direct or cause the direction of the management, policies or activities
of a Person, whether through ownership of voting securities, by contract or
otherwise.
6.19 Management Fees. No Borrower shall enter into any arrangement for
the payment of, or pay, management, advisory or similar fees, except management
and advisory fees payable to the applicable Blackrock Entity pursuant to the
Blackrock Management Agreement or management fees to its corporate services
provider paid in the ordinary course of business; provided, that in any event no
such fees may be paid (but may accrue) during the continuance of an Event of
Default.
6.20 Underwriting Guidelines. No Borrower shall adopt any Underwriting
Guidelines unless such Underwriting Guidelines have been approved by the Lender
in its good faith business judgment.
6.21 Modification of Certain Agreements.
(a) Without the prior written consent of the Lender, neither Anthracite
nor any Borrower shall consent to (a) any material amendment, supplement, waiver
or other modification of, or enter into any forbearance from exercising any
material rights with respect to the terms or provisions contained in any Organic
Document or (b) any increase in any fees payable under the Blackrock Management
Agreement in excess of five percent (5%) per annum of the gross value of the
assets held by such Borrower from time to time.
(b) Without the prior written consent of the Lender, no Borrower shall
amend or otherwise modify the Underwriting Guidelines. Notwithstanding the
preceding sentence, in the event that any Borrower makes any amendment or
modification to the Underwriting Guidelines, such Borrower shall promptly
deliver to the Lender a complete copy of the amended or modified Underwriting
Guidelines.
6.22 ERISA. No Borrower shall (a) have any Plans or ERISA Affiliates
and (b) make any contributions to any Plans or any Multiemployer Plans.
Section 7. Events of Default.
Each of the following events shall constitute an event of default (an
"Event of Default") hereunder:
(a) any Borrower shall default in the payment of any principal of, or
interest on, any Loan when due (whether at stated maturity, upon acceleration or
at mandatory or optional prepayment (including in connection with any Collateral
Value Deficiency Event or Borrowing Base Deficiency Event)); or
(b) any Borrower shall default in the payment of any other amount
payable by it hereunder or under any other Loan Document after notification by
the Lender of such default, and such default shall have continued unremedied for
ten (10) days; or
(c) any representation or warranty made or deemed made herein or in any
other Loan Document by a Borrower or by Anthracite in Section 10 of the Parent
Guaranty shall prove to have been false or misleading in any material respect as
of the time made or furnished (other than the representations set forth in
Section 5.13 (to the extent it relates to an Eligible Asset), Section 5.17 or in
the Collateral Documents which shall not be considered an Event of Default, but
shall be considered solely for the purpose of determining whether such asset is
an Eligible Asset unless such Borrower shall have made such representation with
knowledge that it was materially incorrect or untrue at the time made); or
(d) a Borrower shall fail (i) to comply with the requirements of
Section 3.01, Section 6.04, Section 6.07(a)(i), Section 6.08(a), Sections 6.09
through 6.15 and Sections 6.17 through 6.22 hereof; (ii) to comply with the
requirements of Section 6.01, Section 6.02, Section 6.03, Section 6.06, Sections
6.07(a)(ii), (d) and (f), Section 6.08 (other than clause (a) thereof), Section
6.16 and Section 10.14, and such default shall continue unremedied for five (5)
Business Days following a Specified Date, (iii) to comply with the requirements
of Sections 6.05, 6.07(b) and (d), and Section 10.15, and such default shall
continue unremedied for a period of ten (10) Business Days following a Specified
Date; and (iv) to observe or perform any other covenant or agreement contained
in this Agreement or any other Loan Document and such failure to observe or
perform shall continue unremedied for a period of thirty (30) days following a
Specified Date; provided, that, in respect of clause (iv) only, as long as such
Borrower is diligently attempting to cure such breach, such cure period shall be
extended by an additional period as may be required to cure such breach but in
no event by more than thirty (30) additional days; or
(e) (i) a final judgment or judgments for the payment of money in
excess of $5,000,000 in the aggregate shall be rendered against any Borrower by
one or more courts, administrative tribunals or other bodies having jurisdiction
and the same shall not be satisfied, discharged (or provision shall not be made
for such discharge) or bonded, or a stay of execution thereof shall not be
procured, within thirty (30) days from the date of entry thereof or (ii) a final
judgment by any competent court, administrative tribunal, or other body having
jurisdiction shall have been rendered against Anthracite in an amount in excess
of (A) $10,000,000, if the Tangible Net Worth of Anthracite is less than
$400,000,000 or (B) $20,000,000, if the Tangible Net Worth of Anthracite is
greater than or equal to $400,000,000; or
(f) Any of the following occurs in respect of any Borrower or
Anthracite:
(1) it is, or is deemed for the purposes of any law to be,
unable to pay its debts as they fall due or to be insolvent;
(2) it admits its inability to pay its debts as they fall due;
(3) it suspends making payments on any of its debts or announces
an intention to do so;
(4) the value of the assets of any Borrower is less than its
liabilities (taking into account contingent and prospective
liabilities);
(5) by reason of actual or anticipated financial difficulties,
it begins negotiations with one or more of its creditors with a view
to the readjustment or rescheduling of any of its indebtedness or
liabilities;
(6) an Examiner or a provisional Examiner is appointed or a
moratorium is declared in respect of any of its Indebtedness (and,
if such a moratorium occurs, the ending of such moratorium will not
remedy any Event of Default caused by such moratorium and,
notwithstanding any other term of the Loan Documents, that Event of
Default shall continue to be outstanding unless and until it is
expressly waived by the Lender); or
(7) it is not Solvent; or
(g) any of the following occurs in respect of any Borrower or
Anthracite:
(i) any step is taken (including a petition (other than a petition
for winding-up presented by a creditor which is being contested in good
faith and with due diligence and is discharged or struck out within
thirty days), proposal or convening a meeting) with a view to a
composition, assignment or arrangement with any class of creditors or
with its creditors generally;
(ii) a meeting of it (or its directors) is convened for the purpose
of considering any resolution for (or petition for) its winding-up,
administration, other insolvency proceeding or dissolution or any such
resolution is passed;
(iii) any person files in a court of competent jurisdiction or other
competent forum a petition for its winding-up, administration, other
insolvency proceeding or dissolution;
(iv) an order by a court of competent jurisdiction or other
competent forum for its winding-up, administration or dissolution is
made;
(v) any liquidator, trustee in bankruptcy, judicial custodian,
compulsory manager, receiver, administrative receiver, administrator,
Examiner or similar officer is appointed in respect of it or any of its
assets;
(vi) any corporate action, legal proceedings or other procedure or
step is taken by any Borrower, or legal proceedings or other procedure
or step is taken by any person, in relation to examinership or the
appointment of an Examiner;
(vii) its directors, shareholders or other officers request the
appointment of, or give notice of their intention to appoint, a
liquidator, trustee in bankruptcy, judicial custodian, compulsory
manager, receiver, Examiner, administrative receiver, administrator or
similar officer; or
(viii) any other analogous step or procedure is taken in any other
Eligible Jurisdiction; or
(h) any liquidator, trustee in bankruptcy, judicial custodian,
compulsory manager, receiver, Examiner, administrative receiver, administrator,
Examiner or the like is appointed in respect of any Borrower or any material
part of their respective Property or any other analogous step or procedure is
taken in any other Eligible Jurisdiction; or
(i) the directors of any Borrower request the appointment of a
liquidator, trustee in bankruptcy, judicial custodian, compulsory manager,
receiver, Examiner, administrative receiver, administrator, Examiner or the like
in respect of such Borrower or any material part of their respective Property or
any other analogous step or procedure is taken in any other Eligible
Jurisdiction; or
(j) any Loan Document shall for whatever reason be terminated or cease
to be in full force and effect (other than through payment in full in cash of
the Obligations and without reinstatement of such Obligations), or the
enforceability thereof shall be contested by a Borrower; or
(k) Anthracite or any Borrower shall have (i) defaulted or failed to
perform under (A) any BOA Indebtedness or (B) any note, indenture, loan
agreement, guaranty, swap agreement or any other contract, agreement or
transaction to which it is a party, which default (A) involves the failure to
pay matured obligations, in the aggregate, in excess of (x) $10,000,000, if the
Tangible Net Worth of Anthracite is less than $400,000,000 or (y) $20,000,000,
if the Tangible Net Worth of Anthracite is greater than or equal to $400,000,000
or (B) permits the acceleration of the maturity of the obligations by any other
party to, or beneficiary of, such note, indenture, loan agreement, guaranty,
swap agreement or other contract agreement or transaction, or (ii) breached any
covenant or condition, failed to perform, admitted its inability to perform or
stated its intention not to perform its obligations, in each case in respect of
any repurchase agreement, reverse repurchase agreement, securities contract or
derivative transaction with any party; provided, that any such default, failure
to perform or breach shall not constitute an Event of Default hereunder if
Anthracite cures such default, failure to perform or breach, as the case may be,
within the grace period, if any, provided under the applicable agreement; or
(l) any Material Adverse Change shall occur; or
(m) any audited annual financial statements of any Borrower or
Anthracite (or the notes thereto or other opinions or conclusions stated
therein) shall be qualified or limited by reference to the status of such
Borrower or Anthracite, as applicable, as a "going concern" or a reference of
similar import; or
(n) a Change of Control has occurred;
(o) Anthracite shall have failed to comply with the Parent Financial
Covenants; or
(p) Anthracite shall have failed to maintain its status as a REIT.
Section 8. Remedies Upon Default.
(a) An Event of Default shall be deemed to be continuing unless
expressly waived by the Lender in writing or cured. Upon the occurrence and
during the continuance of one or more Events of Default hereunder, the Lender's
obligation to make additional Loans to the Borrowers shall automatically
terminate without further action by any Person. Upon the occurrence and during
the continuance of one or more Events of Default other than those referred to in
Section 7(f) through (i), the Lender may immediately declare the principal
amount of the Loans then outstanding to be immediately due and payable, together
with all interest thereon and fees and expenses accruing under this Agreement
and the Fee Letter. Upon the occurrence and during the continuance of an Event
of Default referred to in Section 7(f) through (i), such amounts shall
immediately and automatically become due and payable without any further action
by any Person. Upon such declaration or such automatic acceleration, the balance
then outstanding on the Loans shall become immediately due and payable, without
presentment, demand, protest or other formalities of any kind, all of which are
hereby expressly waived by the Borrowers.
(b) Upon the occurrence and during the continuance of one or more
Events of Default, the Lender shall have the right to obtain physical possession
of the servicing records and all other files of the Borrowers relating to the
Collateral and all documents relating to the Collateral which are then or may
thereafter come in to the possession of the Borrowers or any third party acting
for the Borrowers and the Borrower Agent shall deliver to the Lender such
assignments as the Lender shall request in order to enable the Lender to obtain
such possession.
Section 9. No Duty of Lender.
The powers conferred on the Lender hereunder are solely to protect the
Lender's interests in the Collateral and shall not impose any duty upon it to
exercise any such powers. The Lender shall be accountable only for amounts that
it actually receives as a result of the exercise of such powers, and neither it
nor any of its officers, directors, employees or agents shall be responsible to
any Borrower for any act or failure to act hereunder, except for its or their
own gross negligence or willful misconduct.
Section 10. Miscellaneous.
10.01 Waiver. No failure on the part of the Lender to exercise and no
delay in exercising, and no course of dealing with respect to, any right, power
or privilege under any Loan Document shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or privilege under any
Loan Document preclude any other or further exercise thereof or the exercise of
any other right, power or privilege. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law.
10.02 Notices. Except as otherwise expressly permitted by this
Agreement, all notices, requests and other communications provided for herein
(including without limitation any modifications of, or waivers, requests or
consents under, this Agreement) shall be given or made in writing (including
without limitation by telex or telecopy) delivered to the intended recipient at
the address for notices specified below its name on the signature pages hereof
or thereof); or, as to any party, at such other address as shall be designated
by such party in a written notice to each other party; provided, that a copy of
all notices shall simultaneously be delivered to (a) Bank of America, 214 North
Tryon Street, Hearst Tower, 22nd Floor, Charlotte, North Carolina 28555,
NC1-027-22-04; Attention: Angela E. Dugick, Facsimile Number: (704) 386-1094,
Telephone: (704) 388-3372, (b) Bank of America, 100 North Tryon Street, 20th
Floor, Charlotte, North Carolina 28555, NC1-007-20-01; Attention: Paul Kurzeja,
Facsimile Number: (704) 386-8509, Telephone: (704) 409-0267, and (c) Cadwalader,
Wickersham & Taft LLP, 227 West Trade Street, Suite 2400, Charlotte, North
Carolina 28202, Attention: Steven N. Cohen, Esq., Telephone: (704) 348-5100,
Facsimile Number: (704) 348-5200. Except as otherwise provided in this Agreement
and except for notices given under Section 2 (which shall be effective only on
receipt), all such communications shall be deemed to have been duly given when
transmitted by telex or telecopy or personally delivered or, in the case of a
mailed notice, upon receipt, in each case given or addressed as aforesaid.
10.03 Indemnification and Expenses.
(a) The Borrowers agree to indemnify the Lender and its officers,
directors, employees and agents (each an "Indemnified Party") against all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
taxes (including stamp, excise, sales or other taxes which may be payable or
determined to be payable in connection with any of the transactions contemplated
by this Agreement and the other Loan Documents, other than taxes of the Lender
that are not Non-Excluded Taxes; provided, further, that in relation to Irish
withholding tax on interest only, that Lender is a Qualifying Lender), fees,
costs, expenses (including reasonable attorneys' fees and disbursements actually
incurred to external counsel) or disbursements of any kind which may be imposed
on, incurred by or assessed against such Indemnified Party (collectively, the
"Costs") relating to or arising out of this Agreement, the Note, any other Loan
Document or any transaction contemplated hereby or thereby, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the Note, any other Loan Document or any transaction
contemplated hereby or thereby (including, without limitation, such time as this
Agreement shall no longer be in effect and the Loans shall have been repaid in
full), that, in each case, results from anything other than any Indemnified
Party's gross negligence or willful misconduct or the Lender's ownership of any
Eligible Asset following enforcement of its rights under the Loan Documents with
respect thereto (unless and to the extent such liability relates to an event,
circumstance or condition which occurred prior to the enforcement of such
rights). Without limiting the generality of the foregoing, each Borrower
undertakes, jointly and severally, to perform the Irish Tax Indemnification
Obligations. No payment shall be due pursuant to this indemnity to the extent an
amount has been received in relation to the same liability pursuant to Sections
2.09(b), (c) or (d). Without limiting the generality of the foregoing, the
Borrowers agree to hold any Indemnified Party harmless from and indemnify such
Indemnified Party against all Costs relating to or arising out of any violation
or alleged violation of any environmental law, rule or regulation or any other
applicable law that, in each case, results from anything other than such
Indemnified Party's gross negligence or willful misconduct or the Lender's
ownership of any Eligible Asset following enforcement of its rights under the
Loan Documents with respect thereto (unless and to the extent such liability
relates to an event, circumstance or condition which occurred prior to the
enforcement of such rights). Each Indemnified Party agrees that it (i) shall
promptly notify the Borrower Agent of any claim, action or suit asserted or
commenced against it, and (ii) that the Borrowers, with the written consent of
the Lender, may assume the defense thereof with counsel reasonably satisfactory
to such Indemnified Party at the Borrowers' sole expense, (iii) that such
Indemnified Party shall cooperate with the Borrowers on such defense, and (iv)
that such Indemnified Party shall not settle any such claim, action or suit
without the consent of the Borrowers; provided, however, that in the event such
Indemnified Party is not reasonably satisfied with such defense, such
Indemnified Party may assume such defense with counsel satisfactory to such
Indemnified Party at the Borrowers' sole expense. Notwithstanding the foregoing,
the Borrowers shall not be liable to any Indemnified Party for any claim (i)
arising from lawsuits relating to claims of any Indemnified Party against any
other Indemnified Party or (ii) arising from disputes among the Indemnified
Parties regarding the allocation among any of such Persons of any payment
properly made by the Borrowers in accordance with the Loan Documents.
(b) The Borrowers also agree to reimburse an Indemnified Party for all
such Indemnified Party's costs and expenses (including fees actually incurred
and expenses of accountants, attorneys and advisors) incurred in connection with
the enforcement or the preservation of such Indemnified Party's rights under
this Agreement, the Note, any other Loan Document or any transaction
contemplated hereby or thereby, including without limitation the fees and
disbursements of its external counsel. The Borrowers hereby acknowledge that,
notwithstanding the fact that the Loans are secured by the Collateral, the
obligations of the Borrowers under this Agreement are recourse obligations of
the Borrowers.
(c) The Borrowers agree to pay all of the reasonable out-of pocket
costs and expenses (including reasonable fees actually incurred and expenses of
accountants, external attorneys and advisors) incurred by the Lender in
connection with (i) the development, preparation and execution of, and any
amendment, supplement or modification to, this Agreement, the Note, any other
Loan Document or any other documents prepared in connection herewith or
therewith, and (ii) the consummation and administration of the transactions
contemplated hereby and thereby (including, without, limitation all the due
diligence, inspection, testing and review costs and expenses reasonably incurred
by the Lender with respect to the Collateral, including, but not limited to,
those costs and expenses incurred by the Lender pursuant to Sections 10.03(a),
10.14 and 10.15 hereof). In the case of any Eligible Asset that was originated
by the Lender or any Affiliate thereof (such asset, a "Lender Generated Eligible
Asset"), the Lender shall use commercially reasonable efforts to ensure that any
costs or expenses incurred by the Lender in connection with due diligence,
inspection, testing or review and for which reimbursement will be sought are
incurred after giving effect to any efficiencies resulting from the due
diligence, inspection, testing or review of such Lender Generated Eligible Asset
in connection with the origination thereof.
10.04 Amendments. Except as otherwise expressly provided in this
Agreement, any provision of this Agreement may be modified or supplemented only
by an instrument in writing signed by the Borrowers and the Lender and any
provision of this Agreement (other than obligations of the Lender) may be waived
by the Lender. 10.05 Assignments and Participations. (a) The rights and
obligations of the parties under the Loan Documents and under any Notes shall
not be assigned by the Lender without the prior written consent of the Borrower
Agent and shall not be assigned by any Borrower without the prior written
consent of the Lender; provided, that the Lender shall be permitted to assign
such rights and obligations without the consent of the Borrower Agent in the
case of an assignment by the Lender to (x) any Approved Assignee, which is a
direct or indirect subsidiary of Bank of America Corporation or (y) any other
Approved Assignee during the continuance of a Specified Event of Default;
provided, further, that the parties to each such assignment shall execute and
deliver an assignment and acceptance, in form and substance acceptable to the
Borrower Agent (an "Assignment and Acceptance"), along with replacement Notes
executed and delivered by the Borrowers and such other documents as the Borrower
Agent or the Lender shall consider reasonably necessary to effect fully such
assignment and/or confirm the status of such assignee as an Approved Assignee.
(b) Subject to the satisfaction of the conditions set forth in (a)
above, upon such execution and delivery, from and after the effective date
specified in such Assignment and Acceptance, (i) the assignee thereunder shall
be a party hereto and, to the extent that rights and obligations hereunder have
been assigned to it pursuant to such Assignment and Acceptance, have the rights
and obligations of the Lender hereunder, and (ii) the Lender assignor thereunder
shall, to the extent that any rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under this Agreement.
(c) The Lender may sell participations to one or more Persons in or to
all or a portion of its rights and obligations under this Agreement with written
notification to the Borrower Agent within a reasonable time thereafter;
provided, however, that (i) after giving effect to any participations sold, the
Lender shall continue to hold an interest in the Maximum Credit and/or the
outstanding Loans in an amount not less than the BOA Hold Amount, (ii) the
Lender shall act as exclusive agent for all participants in any dealings with
the Borrower Agent and the Borrowers in connection with this Agreement and the
other Loan Documents, (iii) the Borrower Agent and the Borrowers shall not be
obligated to deal directly with any Person other than the Lender in connection
with this Agreement and the other Loan Documents and the Lender shall maintain
unilateral control over all discretionary determinations to be made thereunder,
including, without limitation, determinations as to eligibility and purchase of
Eligible Assets, the Market Value thereof, the granting of waivers of
noncompliance with the terms of the Loan Documents, the granting of extensions
of the Termination Date and/or increases in the Maximum Credit and the exercise
of rights and remedies upon the occurrence and during the continuation of an
Event of Default, (iv) the Lender shall pay or reimburse the Borrower Agent or
the Borrowers, as applicable, or any other Person for any fees, costs, expenses
or other amounts that would not have been incurred had no participation been
sold hereunder and (v) at any time prior to the occurrence and continuance of a
Specified Event of Default, the Lender shall not sell (unless consented to by
the Borrower Agent (such consent not to be unreasonably withheld)), any
participation to any non-financial institutions engaged in the business of
purchasing B notes and/or mezzanine loans (it being understood that for the
purposes of this clause (c)(v) of Section 10.05, any insurance company, bank or
mutual fund shall be deemed a financial institution hereunder).
(d) The Lender may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 10.05, disclose
to the assignee or participant or proposed assignee or participant, as the case
may be, any information relating to the Borrowers or any Subsidiary, any
Eligible Asset, any Underlying Asset or to any aspect of the Loans that has been
furnished to the Lender by or on behalf of the Borrowers or any Subsidiary.
(e) The Lender may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation, the
Loans owing to it and the Note held by it) in favor of any other Person
(including the Federal Reserve Bank in accordance with Regulation A of the Board
of Governors of the Federal Reserve System issued by such Federal Reserve Bank).
No such assignment shall release the assigning Lender from its obligations
hereunder.
(f) The Lender may at any time disclose any information concerning
Anthracite or any Borrower (and any of their respective affiliates) to any
assignee of or participant in, or any prospective assignee of or participant in,
any of the rights and obligations under this Agreement; provided, that the
Lender and the applicable prospective assignee or participant shall, prior to
such disclosure, execute a confidentiality agreement substantially in the form
used by the Lender in its ordinary course of business.
10.06 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
10.07 Survival. The obligations of the Borrowers under Sections 3.03,
3.04, 3.05, and 10.03 hereof shall survive the repayment of the Loans and the
termination of this Agreement. In addition, each representation and warranty
made or deemed to be made by a request for a borrowing, herein or pursuant
hereto shall survive the making of such representation and warranty, and the
Lender shall not be deemed to have waived, by reason of making any Loan, any
Default that may arise because any such representation or warranty shall have
proved to be false in any material respect, notwithstanding that the Lender may
have had notice or knowledge or reason to believe that such representation or
warranty was false at the time such Loan was made.
10.08 Captions. The table of contents and captions and section headings
appearing herein are included solely for convenience of reference and are not
intended to affect the interpretation of any provision of this Agreement.
10.09 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
10.10 Governing Law. This Agreement shall be governed by New York law
without reference to choice of law doctrine (other than Section 5-1401 of the
New York General Obligations Law).
10.11 Submission To Jurisdiction; Waivers. Each Borrower hereby
irrevocably and unconditionally:
(A) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT, THE NOTE AND THE OTHER
LOAN DOCUMENTS, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT
IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK, THE FEDERAL COURTS OF THE UNITED
STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
APPELLATE COURTS FROM ANY THEREOF;
(B) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE
BROUGHT IN SUCH COURTS AND, TO THE EXTENT PERMITTED BY LAW, WAIVES
ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO
PLEAD OR CLAIM THE SAME;
(C) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR
PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED
OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL),
POSTAGE PREPAID, TO ITS ADDRESS SET FORTH UNDER ITS SIGNATURE BELOW
OR AT SUCH OTHER ADDRESS OF WHICH THE LENDER SHALL HAVE BEEN
NOTIFIED;
(D) AGREES THAT THE LENDER AND EACH BORROWER SHALL HAVE THE
RIGHT (BUT NOT THE OBLIGATION) FROM TIME TO TIME TO MAKE OR CAUSE TO
BE MADE TAPE RECORDINGS OF COMMUNICATIONS BETWEEN ITS EMPLOYEES AND
THOSE OF ANY OTHER PARTY WITH RESPECT TO THE TRANSACTIONS
CONTEMPLATED HEREBY. THE LENDER AND EACH BORROWER HEREBY CONSENT TO
THE ADMISSIBILITY OF SUCH TAPE RECORDINGS IN ANY COURT, ARBITRATION,
OR OTHER PROCEEDINGS, AND AGREE THAT A DULY AUTHENTICATED TRANSCRIPT
OF SUCH A TAPE RECORDING SHALL BE DEEMED TO BE A WRITING
CONCLUSIVELY EVIDENCING THE PARTIES' AGREEMENT; AND
(E) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO
EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION.
10.12 WAIVER OF JURY TRIAL. EACH OF THE BORROWERS AND THE LENDER HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY.
10.13 Acknowledgments. The Borrowers hereby acknowledge that:
(a) each has been advised by counsel in the negotiation, execution and
delivery of this Agreement, the Note and the other Loan Documents;
(b) the Lender has no fiduciary relationship to the Borrowers, and the
relationship between the Borrowers and the Lender is solely that of debtor and
creditor; and
(c) no joint venture exists between the Lender and any Borrower.
10.14 Periodic Due Diligence Review.
(a) Eligible Assets. Each Borrower acknowledges that the Lender has the
right to perform continuing due diligence reviews with respect to the Eligible
Assets and the manner in which they were originated, for purposes of verifying
compliance with the representations, warranties and specifications made
hereunder, or otherwise, and each Borrower agrees that, unless an Event of
Default has occurred and is continuing (in which case no notice is required),
upon reasonable (but no less than three (3) Business Days) prior notice to the
Borrower Agent, the Lender or its authorized representatives shall be permitted
during normal business hours to (i) examine, inspect, and make copies and
extracts of, any and all Eligible Asset Documents in the possession or under the
control of the Borrowers and/or any of their Subsidiaries and (ii) examine and
inspect any Underlying Assets. Each Borrower also shall make available to the
Lender a knowledgeable financial or accounting officer for the purpose of
answering questions respecting the Eligible Asset Documents and the Eligible
Assets. Without limiting the generality of the foregoing, the Borrowers
acknowledge that the Lender may make Loans to the Borrowers based solely upon
the Borrowing Base Certificate and the representations, warranties and covenants
contained herein, and that the Lender, at its option, has the right at any time
to conduct a partial or complete due diligence review on some or all of the
Eligible Assets.
(b) Borrower. The Borrowers acknowledge that the Lender has the right
to perform periodic due diligence reviews of each Borrower's operations,
including, but not limited to, a review of (1) the financial condition of each
Borrower, (2) loan origination and servicing guidelines, and (3) other corporate
due diligence matters at the reasonable discretion of the Lender. In connection
therewith, the Borrowers agree that upon reasonable (but no less than three (3)
Business Days) prior notice to the Borrower Agent (provided, that if an Event of
Default has occurred and is continuing, no such notice shall be required), the
Lender or its authorized representatives shall be permitted during normal
business hours to examine, inspect, and make copies and extracts of all
documents, records, agreements, instruments or information relating to the
Borrowers, which are in possession or under the control of the Borrowers, as the
Lender may reasonably request. The Borrowers shall also make available to the
Lender a knowledgeable financial or accounting officer for the purpose of
answering questions respecting the financial condition of each Borrower and make
available to the Lender an officer of each Borrower, for the purpose of
answering questions respecting other corporate due diligence matters.
(c) Fees and Expenses. The Borrowers further agree that each Borrower
shall reimburse the Lender as and when billed for any and all costs and expenses
incurred by the Lender (including the fees, disbursements and expenses of
external counsel to the Lender) in connection with the Lender's activities
pursuant to this Section 10.14.
10.15 Eligible Asset Servicer. Each Borrower shall, and shall cause the
applicable Eligible Asset Servicer to, (i) provide a copy of the servicing
agreement to the Lender (the "Eligible Asset Servicing Agreement"), and (ii)
provide an Eligible Asset Servicer Notice and Agreement to the Eligible Asset
Servicer substantially in the form of Exhibit K hereto (a "Eligible Asset
Servicer Notice and Agreement"), such Eligible Asset Servicer Notice and
Agreement acknowledged and agreed to by Eligible Asset Servicer and delivered to
the Lender. Any assignee of an Eligible Asset Servicer shall be approved in
writing by the Lender and shall acknowledge and agree to a Eligible Asset
Servicer Notice and Agreement prior to such successor's assumption of servicing
obligations with respect to the Eligible Assets.
10.16 Judgment Currency. If, for the purposes of obtaining judgment in
any c ourt, it is necessary to convert a sum due hereunder or any other Loan
Document in one currency into another currency, the rate of exchange used shall
be that at which in accordance with normal banking procedures the Lender could
purchase the first currency with such other currency on the Business Day
preceding that on which final judgment is given. The obligation of each Borrower
in respect of any such sum due from it to the Lender hereunder or under the
other Loan Documents shall, notwithstanding any judgment in a currency (the
"Judgment Currency") other than that in which such sum is denominated in
accordance with the applicable provisions of this Agreement (the "Agreement
Currency"), be discharged only to the extent that on the Business Day following
receipt by the Lender of any sum adjudged to be so due in the Judgment Currency,
the Lender may in accordance with normal banking procedures purchase the
Agreement Currency with the Judgment Currency. If the amount of the Agreement
Currency so purchased is less than the sum originally due to the Lender from any
Borrower in the Agreement Currency, such Borrower agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify the Lender or the
Person to whom such obligation was owing against such loss. If the amount of the
Agreement Currency so purchased is greater than the sum originally due to the
Lender in such currency, the Lender agrees to return the amount of any excess to
such Borrower (or to any other Person who may be entitled thereto under
applicable law).
10.17 Treatment of Certain Information. Notwithstanding anything to the
contrary contained herein or in any other Loan Document, all Persons may
disclose to any and all Persons, without limitation of any kind, the federal
income tax treatment of the Loans or any of the transactions contemplated by
this Agreement or any other Loan Document, any fact relevant to understanding
the federal tax treatment of the transactions contemplated by this Agreement and
all materials of any kind (including opinions or other tax analyses) relating to
such federal income tax treatment.
10.18 Limited Recourse, Etc. Each of the parties acknowledges and
agrees that:
(a) Definitions. For the purpose of this Section 10.18 the following
definition shall apply:
"Directors" shall mean the directors of AHR Capital who are employees
of Citco Corporate Services (Ireland) Limited as shall be appointed from time to
time as directors of AHR Capital and shall include the employer of the
directors, the shareholders of the employer, it's shareholders and agents (if
any). For the avoidance of doubt and for the purposes of this provision only,
neither the Guarantor, nor any of its Subsidiaries or Affiliates shall be deemed
to be a "Director" of AHR Capital;
(b) subject to clause (c) below, the Lender shall not take or initiate
any insolvency or bankruptcy proceedings (including, without limitation,
examinership) or issue any petition for the winding-up of AHR Capital. If any
such winding-up, insolvency or bankruptcy proceedings of AHR Capital shall
commence, the Lender may exercise any right and take any action available to any
creditor in any such circumstances;
(c) the Lender may enforce the Collateral Documents in accordance with
the provisions thereof and such enforcement may include, without limitation, the
appointment by it of a receiver to all or any part of the Collateral; and
(d) the Lender's recourse in respect of the Obligations or any claim
against AHR Capital relating to or in connection with the Loan Documents is
limited to the Collateral and the sums, proceeds, receivables and all other
rights relating, appertaining or attaching thereto or deriving therefrom. In
such regard, the Lender may take all or any such action with respect to such
assets to seek to maximize its return upon enforcement. For the avoidance of
doubt, this provision shall only limit the liability of AHR Capital for the
discharge of the Obligations and any claim against AHR Capital in respect of or
in connection with the Loan Documents, and shall not limit or restrict in any
way the accrual of interest on any unpaid amount, or, other than in respect of
AHR Capital, derogate from or otherwise limit the right of recovery, realization
or application by the Lender on any unpaid amount or pursuant to any of the Loan
Documents; provided, however that nothing contained in this clause (d) shall
limit the rights of the Lender to bring or commence any action, claim or
proceeding (or take any other action) as it may see fit for the sole purpose of
enabling it to claim against the Guarantor for the full amount of any loss it
may incur hereunder.
(e) For the avoidance of doubt, save as expressly prohibited in this
Section 10.18, nothing in this Section 10.18 shall extinguish or be deemed to
extinguish the right of the Lender to contact and hold meetings with any other
creditor of AHR Capital.
(f) Absent fraud, negligence, willful or misleading misconduct,
deliberate action or omission designed to mislead, avoid, reduce or mitigate
liability, or breach of statutory duty, no personal liability shall attach to
the Directors and the Lender shall not take or initiate any proceedings or issue
any petition against the Directors in connection with the Loan Documents.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
BORROWER AGENT
- --------------
ANTHRACITE CAPITAL, INC.
By: /s/ Robert L. Friedberg
------------------------------------
Name: Robert L. Friedberg
Title: Vice President and Secretary
Address for Notices:
- -------------------
Anthracite Capital, Inc.
40 East 52nd Street
New York, New York 10022
Attention: Richard Shea
Telecopier No.: (212) 810-8758
Telephone No.: (212) 754-5579
BORROWER
- --------
SIGNED, SEALED AND DELIVERED by
the duly authorised attorney of
AHR Capital BofA Limited
in the presence of:
/s/ Stephanie Talbot
- ---------------------------------
Signature of witness
/s/ Stephanie Talbot
- ---------------------------------
Name of witness
Address of witness
40 East 52nd Street
New York, NY 10022
Fax no: (212) 754-8758
Attention: Richard Shea
Address for Notices:
- -------------------
AHR Capital BofA Limited
Customs House Plaza, Block 6
IFSC
Dublin 1
Ireland
Fax no: +353 1 [ ]
Attention: The Directors
with copies to
c/o Anthracite Capital, Inc.
40 East 52nd Street
New York, New York 10022
Attention: Richard Shea
Telecopier No.: (212) 810-8758
Telephone No.: (212) 754-5579
and
c/o Anthracite Capital, Inc.
One PNC Plaza, 19th Floor
Mailstop P1-P0PP-19-2
249 Fifth Avenue
Pittsburgh, PA 15222
Attention: Janice De Julio
Telecopier No.: (412) 762-4546
Telephone No.: (412) 762-4675
LENDER
- ------
BANK OF AMERICA, N.A.
By: /s/ Angela E. Dugick
----------------------------------
Name: Angela E. Dugick
Title: Senior Vice President
Address for Notices:
- -------------------
214 North Tryon Street, 22nd Floor
Mail code: NC1-027-22-04
Charlotte, North Carolina 28555
Attention: Angela E. Dugick
Telecopier No.: (704) 386-1094
Telephone No.: (704) 388-3372
with a copy to:
100 North Tryon Street, 20th Floor
Mail code: NC1-007-20-01
Charlotte, North Carolina 28555
Attention: Paul Kurzeja
Telecopier No.: (704) 386-8509
Telephone No.: (704) 409-0267
with a copy to:
Cadwalader, Wickersham & Taft LLP
227 West Trade Street, Suite 2400
Charlotte, North Carolina 28202
Attention: Steven N. Cohen, Esq.
Telecopier No.: (704) 348-5200
Telephone No.: (704) 348-5100