Senior Secured Loan Agreement
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SENIOR SECURED LOAN AGREEMENT
Between
______
and
______
Dated as of May _____, 2010
84216620_4 LOAN AGREEMENT
THIS SENIOR SECURED LOAN AGREEMENT (this “Agreement”), dated as of ______, is entered into by and between ______, a ______limited liability company (the “Lender”), and ______, a Delaware limited liability company (the “Borrower” and, together with the Lender, the “Parties”).
W I T N E S S E T H:
WHEREAS, the Borrower wishes to borrow from the Lender an aggregate principal amount of up to thirty million Dollars ($30,000,000) for the purposes described in Section 2.1 herein; and
WHEREAS, the Lender desires on the terms and subject to the conditions hereinafter set forth to make Loans to the Borrower, from time to time, for such purposes as stated herein;
NOW, THEREFORE, in consideration of the mutual agreements set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Lender and the Borrower hereby agree as follows:
ARTICLE I
DEFINITIONS
Section I.1 General Definitions. Wherever used in this Agreement, or the Exhibits or Schedules attached hereto, unless the context otherwise requires, the following terms have the following meanings, including in the introduction and recitals hereto:
“Additional Amounts” has the meaning given to it in Section 2.8(b).
“Affiliate” means, with respect to any Person, (a) any other Person directly or indirectly controlling, controlled by, or under common control with that Person; (b) any other Person owning beneficially or controlling five percent (5%) or more of the equity interest in such Person; (c) any officer, director, partner, or shareholder of such Person; or (d) any spouse, parent, sibling (natural born or adopted) or child (natural born or adopted) of such Person. As used in this definition of “Affiliate,” the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities or partnership or other ownership interest, by contract, or otherwise.
“ Agreement” has the meaning given to it in the introductory paragraph of this Agreement.
“Auditors” means ______or such other accounting firm as shall be approved by the Lender in its sole discretion.
“Borrower” has the meaning given to it in the introductory paragraph of this Agreement.
1 84216620_4 “Business” means the acquisition, management and disposition of pre-existing mortgage products.
“ Business Day” means a day on which banks are open for business in the ______
“Collateral” means all estate, right, title and interest of the Borrower in, to and under, all and singular of the Borrower’s assets and properties of any kind, whether tangible or intangible and whether now owned or hereafter acquired, being the assets and properties in which the Lender is granted a Lien pursuant to any of the Transaction Documents to secure the Obligations.
“Commitment Amount” means, on any date, an amount not to exceed $30,000,000.
“Commitment Fee” has the meaning given to it in Section 2.6(a).
“ Commitment Period” means the period beginning on the date of this Agreement and ending on the Commitment Period Expiration Date.
“ Commitment Period Expiration Date” means the earliest to occur of: (a) the Final Payment Date; or (b) the date on which any Commitment Termination Event occurs.
“Commitment Termination Event” means: (a) the occurrence of any Default described in Section 6.1(e); or (b) the occurrence and continuance of any other Event of Default, and either (i) the declaration of the Loans and other Obligations to be due and payable pursuant to Section 6.1, or (ii) in the absence of such declaration, the giving of notice by the Lender to the Borrower that the Commitment Amount has been terminated.
“ Confidential Information” means (a) any non-public information relating to, and provided by, the Borrower to the Lender, or (b) any information relating to the existence and terms of the Financing Documents and the existence and terms of the documents and transactions contemplated hereby and thereby.
“Corrupt Practice” means the giving, directly or indirectly, of any gift or similar benefit by the Borrower, or any other Person acting on its behalf to any customer, supplier, governmental employee or other Person who is or may be in a position to help or hinder the business of the Borrower (or assist the Borrower in connection with any actual or proposed transaction) which (i) could reasonably be expected to result in any civil, criminal or governmental litigation or proceeding against the Borrower, (ii) if not given would be expected to have a material adverse effect on the assets, business or operations of the Borrower, or (iii) if not continued, would reasonably be expected to have a material adverse effect on the assets, business or operations of the Borrower or which would be reasonably expected to subject the Borrower to a proceeding or penalty in any private or governmental litigation or proceeding.
“Debt” means with respect to any Person, as of the relevant date for calculation, without duplication, (i) any obligation of such Person for borrowed money, including by way of overdraft privileges; (ii) any obligation of such Person evidenced by bonds, debentures, notes or other similar instruments; (iii) any obligation of such Person to pay the deferred purchase price of goods, property or services (other than trade payables incurred in the ordinary course of business
2 84216620_4 and payable in accordance with customary business practices or which are being contested in good faith by appropriate proceedings and for which adequate reserves have been set aside on the books of such Person in accordance with U.S. GAAP); (iv) any obligation of such Person under conditional sales or other title retention agreements; (v) the net aggregate rentals under any lease by such Person as lessee that under U.S. GAAP would be capitalized on the books of the lessee; (vi) any obligation of such Person to purchase securities or other property which arises out of or in connection with the sale of the same or substantially similar securities or property; (vii) any obligations of such Person under reimbursement or similar agreements with respect to the issuance of letters of credit, banker’s acceptances or other similar financial accommodations; (viii) any obligations of such Person to pay rent or other amounts under leases entered into in connection with sale and leaseback transactions involving assets of such Person being sold in connection therewith; (ix) any Debt of others secured by a Lien on any asset of such Person; (x) the net liabilities or obligations of such Person under any interest rate or currency swap or other financial hedging contract; (xi) any Debt of others guaranteed, directly or indirectly, by such Person; and (xii) any other amounts raised under any other transaction having the financial effect of a borrowing and classified as such under U.S. GAAP.
“Default” means any event which, at the giving of notice, lapse of time, determination of materiality or fulfillment of any other applicable condition (or any combination of the foregoing), would constitute an Event of Default.
“Default Interest” means the interest payable on the Loan as set forth in Section 2.11.
“Disbursement” means a disbursement of the Loan pursuant to Section 2.3(a).
“Disbursement Date” means the date on which a Disbursement occurs.
“Disbursement Request” has the meaning given to it in Section 2.3(a).
“Dollars” and the “$” sign mean the lawful currency of the United States of America.
“Environmental Laws” means, at a given time, any and all international, federal, national, state and local laws, regulations, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or other restrictions enacted by any applicable Government Authority with jurisdiction over the assets and/or operations of the Borrower and relating to the environment or to emissions, discharges, releases or threatened releases of pollutants, contaminants, chemicals, or industrial, toxic or hazardous substances or wastes into the environment.
“Event of Default” has the meaning given to it in Section 6.1.
“Evidence of Disbursement” has the meaning given to it in Section 2.3(b).
“Excess Cash Flow” means for any Quarterly Period means (i) the net proceeds received by the Borrower attributable to the Collateral by the Borrower during such Quarterly Period, plus (ii) the amount of Excess Cash Flow at the end of the immediately prior Quarterly Period which was not used to make a Prepayment pursuant to Section 2.5(b), less (iii) the amount of all interest payments made by the Borrower during such Quarterly Period, less (iv) the amount of
3 84216620_4 the Borrower’s budgeted, normal operating expenses during such Quarterly Period to the extent not paid from the Borrower’s operating account funded by the equity contributions of the Borrower’s Members.
“Excess Cash Flow Application Date” has the meaning given to it in Section 2.5(b).
“ Excluded Taxes” means all income taxes, minimum or alternative minimum income taxes, withholding taxes imposed on gross amounts, any tax determined based upon income, capital gains, gross income, sales, net profits, windfall profits or similar items, franchise taxes (or any other tax measured by capital, capital stock or net worth), gross receipts taxes, branch profits taxes, margin taxes (or any other taxes imposed on or measured by net income, or imposed in lieu of net income) payable by the Lender or any of its Affiliates, or the successors and assigns thereof, in any jurisdiction to any Governmental Authority (or political subdivision or taxing authority thereof) in connection with any payments received under this Agreement by the Lender, its Affiliates or the successors and assigns thereof, or any such tax imposed in connection with the execution and delivery of, and the performance of its obligations under, this Agreement.
“Expenses” has the meaning given to it in Section 7.4(a).
“Extension Fee” has the meaning set forth in Section 2.6(b).
“ Extension Option” means, subject to no Event of Default having occurred and continuing, the Borrower’s right to extend the Final Payment Date to ______, upon: (i) the giving of at least thirty (30) and not more than sixty (60) days notice to the Lender; and (ii) the payment of the Extension Fee.
“ Fee Disbursement” means that amount of Loan proceeds included in a Disbursement Request related to a Commitment Fee.
“ Final Payment” means such amount as may be necessary to repay the Loan in full together with accrued but unpaid interest and any other amounts owing by the Borrower to the Lender pursuant to this Agreement, the Note or any other Transaction Document.
“Final Payment Date” means ______, or, if the Borrower elects to exercise the Extension Option, ______.
“ Financial Statements” means the Borrower’s (i) unaudited quarterly financial statements, and/or (ii) audited annual financial statements.
“ Financing Documents” means this Agreement, the Note and any other document or instrument delivered in connection with any of the foregoing whether or not specifically mentioned herein or therein.
“ Fiscal Year” means the accounting year of the Borrower, commencing each year on January 1 and ending on December 31 of the same calendar year, or such other accounting period of the Borrower as the Borrower may, with the Lender’s written consent, from time to time designate in accordance with applicable law as the accounting year of the Borrower.
4 84216620_4 “ Fraudulent Practice” means a misrepresentation of facts in order to influence a procurement process or execution of a contract, and includes collusive practices among bidders designed to establish bid prices at artificial, non-competitive levels and designed to deprive the employer or purchaser of the benefit of free and open competition.
“ Government Authority” means any government, governmental department, ministry, cabinet, commission, board, bureau, agency, tribunal, regulatory authority, instrumentality, judicial, legislative, fiscal, or administrative body or entity, domestic or foreign, federal, state or local having jurisdiction over the matter or matters and Person or Persons in question.
“Indemnified Person” has the meaning given to it in Section 7.15.
“Indemnity” has the meaning given to it in Section 7.15.
“Initial Disbursement” has the meaning given to it in Section 2.3(a).
“Initial Disbursement Date” has the meaning given to it in Section 2.3(a).
“ Interest Payment Date” means, in respect of an Interest Period other than the first Interest Period, the last day of such Interest Period, and in respect of the first Interest Period, the last day of the calendar month during which the Initial Disbursement Date occurs.
“Interest Period” means (i) for the first Interest Period, the period commencing on the 1st day of the month in which the Agreement is executed and ending on the last day of the calendar month during which the Initial Disbursement Date occurs; (ii) thereafter, each period commencing on the last day of the immediately preceding Interest Period and ending three months thereafter; provided, however, that the foregoing provisions relating to Interest Periods are subject to any contrary provisions in this Agreement and are subject to the following: (x) if any Interest Period would otherwise end on a day other than a Business Day, such Interest Period shall end on the next succeeding Business Day; (y) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month; and (z) any Interest Period that otherwise would extend beyond the Final Payment Date shall end on the Final Payment Date.
“Interest Rate” has the meaning given to it in Section 2.10(b).
“Lender” has the meaning given it in the introductory paragraph of this Agreement.
“Lender Affiliates” has the meaning given to it in Section 7.12(a).
“ LIBOR” means, in respect of any Interest Period, the rate which appears in the Wall Street Journal on the 13th day of the month preceding the commencement of the applicable Interest Period for Dollar deposits for a period of ninety (90) days.
“ Lien” means any lien, pledge, preferential arrangement, mortgage, security interest, deed of trust, charge, assignment, hypothecation, title retention, privilege or other encumbrance on or with respect to property or interest in property having the practical effect of constituting a
5 84216620_4 security interest with respect to the payment of any obligation with, or from the proceeds of, any asset or revenue of any kind.
“LLC Agreement” means the Limited Liability Company Agreement of the Borrower.
“Loan” means the senior secured term loan to be made available by the Lender to the Borrower hereunder pursuant to Section 2.2 in the maximum aggregate amount of thirty million Dollars ($30,000,000) or, as the context may require, the principal amount thereof from time to time outstanding.
“Loss” has the meaning given to it in Section 7.15.
“Managing Member” has the meaning given it in the LLC Agreement.
“ Material Adverse Effect” means a material adverse effect on (a) the business, operations, prospects, condition (financial or otherwise) or property of the Borrower; (b) the validity or enforceability of any provision of any Transaction Document; (c) the ability of any party to any Transaction Document to timely perform its obligations thereunder; or (d) the rights and remedies of the Lender under any of the Transaction Documents.
“Member” means any legal owner of membership interest in the Borrower.
“Non-Arms-Length Transaction” means any transaction by the Borrower with any Person who is an Affiliate of the Borrower or an Affiliate of any Member that is on terms that would be less favorable to the Borrower than in a comparable transaction negotiated on an arms-length, market terms basis with a Person who is not a an Affiliate of the Borrower or an Affiliate of any Member.
“Note” has the meaning given to it in Section 2.12.
“ Obligations” means all obligations (monetary or otherwise) of the Borrower arising under or in connection with the Financing Documents and the Security Agreement and each other document or instrument delivered in connection with the foregoing.
“ Organizational Documents” means, with respect to any Person, the constituent documents (the Certificate of Formation, Memorandum and Articles of Association, bylaws, shareholders agreements, operating agreements or such other constituent documents howsoever called), as the same may be amended from time to time hereafter in accordance with the applicable provisions thereof and hereof.
“Party” has the meaning given to it in the introductory paragraph of this Agreement.
“ Permitted Investments” means U.S. federal government securities or interest-bearing bank deposits, time deposits or money market funds offered by any U.S. commercial bank having a capital surplus in excess of Five Hundred Million Dollars (US$500,000,000), a long- term domestic debt rating of at least usAA issued by Standard & Poor’s or AA(U.S.) issued by Fitch, and a short-term domestic debt rating of usA-1 issued by Standard & Poor’s or F1(U.S.)
6 84216620_4 issued by Fitch, but in no event shall any such investments have a maturity longer than three months (unless otherwise approved by the Lender).
“Permitted Liens” means: (i) Liens in favor of the Lender; (ii) statutory Liens created by operation of applicable law; (iii) Liens arising in the ordinary course of business and securing obligations that are not overdue or are being contested in good faith by appropriate proceedings; (iv) Liens, at any time, for judgments of an aggregate amount of less than one hundred thousand Dollars ($100,000) provided such judgments are paid or discharged or the enforcement thereof is stayed within 30 days of the date such judgment is granted; and (v) Liens for Taxes not yet due and payable or that are being contested in good faith by appropriate proceedings, provided that adequate reserves with respect thereto are maintained on the books of the Borrower in accordance with U.S. GAAP.
“Person” means and includes any natural person, individual, partnership, joint venture, corporation, trust, limited liability company, limited company, joint stock company, unincorporated organization, government entity or any political subdivision or agency thereof, or any other entity.
“ Pledge Agreement” shall mean the Pledge Agreement dated as of the date hereof between ______, the Borrower and the Lender pledging the membership interests of the Borrower to the Lender.
“Prepayment” has the meaning given to it in Section 2.5(a).
“Prepayment Notice” has the meaning given to it in Section 2.5(a).
“ Quarterly Period” means the successive three month periods from July 1 through September 30, October 1 through December 31, January 1 through March 31, and April 1 through June 30, commencing with the period from ______through September ______.
“Restricted Payment” means: (i) any direct or indirect advance, loan or other extension of credit (including by way of guarantee or similar arrangement, but excluding ordinary course advances to employees for immaterial amounts) or capital contribution to any Person (by means of any transfer of cash or other property to others or any payments for property or services for the account or use of others), or any purchase or acquisition of capital stock, Debt or similar instruments issued by such Person, unless as specifically provided herein; (ii) the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value, prior to scheduled maturity, scheduled repayment or scheduled sinking fund payment of any of such Person’s obligations which are subordinate to the obligations owed to the Lender; or (iii) any distribution or payment on account of any membership interest (or other equity interest) of such Person.
“ Security Agreement” shall mean the Security Agreement dated as of the date hereof between the Borrower and the Lender, as the same may be amended, supplemented, restated or otherwise modified from time to time.
7 84216620_4 “ Subsidiary” means any Person (i) which is directly or indirectly controlled by the Borrower; (ii) in which the Borrower owns, directly or indirectly, at least twenty percent (20%) of the share capital; or (iii) which is a Subsidiary of a company described in clause (i) or (ii) above. As used in this definition of “Subsidiary”, the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a company, whether through ownership of voting securities, by contract, or otherwise.
“Taxes” means all deductions or withholdings for any and all present and future taxes, levies, imposts, stamp or other duties, fees, assessments, deductions, withholdings, all other governmental charges, and all liabilities with respect thereto.
“Transaction Documents” means the Financing Documents, the Security Agreement and the Pledge Agreement.
“United States” means the United States of America.
“ U.S. GAAP” means generally accepted accounting principles in the United States in effect from time to time, and applied on a consistent basis.
Section I.2 Financial Calculations.
(a) All financial calculations to be made under, or for the purposes of, this Agreement and any other Financing Document shall be determined in accordance with U.S. GAAP and, except as otherwise required to conform to any provisions of this Agreement, shall be calculated from the then most recently issued Financial Statements which the Borrower is obligated to furnish to the Lender pursuant to Section 5.1(f).
(b) Where quarterly Financial Statements are used for the purposes of making certain financial calculations and those Financial Statements are with respect to the last quarter of a Fiscal Year, then, at the Lender’s option, those calculations may instead be made from the audited Financial Statements for the relevant Fiscal Year.
(c) If any Material Adverse Effect has occurred after the end of the period covered by the Financial Statements used to make the relevant financial calculations, as prepared in accordance with U.S. GAAP, that Material Adverse Effect shall be taken into account in making the relevant calculations.
Section I.3 Interpretation. In this Agreement, unless the context otherwise requires, all words and personal pronouns relating thereto shall be read and construed as the number and gender of the party or parties requires and the verb shall be read and construed as agreeing with the required word and pronoun; the division of this Agreement into Articles and Sections and the use of headings and captions is for convenience of reference only and shall not modify or affect the interpretation or construction of this Agreement or any of its provisions; the words “herein,” “hereof,” “hereunder,” “hereinafter” and “hereto” and words of similar import refer to this Agreement as a whole and not to any particular Article or Section hereof; the words “include,” “including,” and derivations thereof shall be deemed to have the phrase “without limitation” attached thereto unless otherwise expressly stated; references to a specified Article, Exhibit, Section or Schedule shall be construed as a reference to that specified Article, Exhibit, Section or
8 84216620_4 Schedule of this Agreement; and any reference to this Agreement or any of the Transaction Documents means such agreement or document as the same shall be amended, supplemented or modified and from time to time in effect.
Section I.4 Business Day Adjustment. Where the day on or by which a payment is due to be made is not a Business Day, that payment shall be made on or by the next succeeding Business Day unless that next succeeding Business Day falls in a different calendar month, in which case that payment shall be made on or by the Business Day immediately preceding the day on or by which such payment is due to be made.
ARTICLE II
AGREEMENT FOR THE LOAN
Section II.1 Use of Proceeds. The Borrower shall use the proceeds of the Loans for the following purposes: (i) to purchase, from time to time, non-performing and/or sub- performing pre-existing residential mortgage loans; and (ii) to pay transaction costs, fees and expenses associated with the Loan.
Section II.2 Commitment; Loans. On the terms and subject to the conditions of this Agreement, the Lender agrees from time to time on any Business Day occurring prior to the Commitment Period Expiration Date, to make Disbursements to Borrower.
Section II.3 Disbursements.
(a) Disbursements of a portion of the Loan (each a “Disbursement”) shall be made to the Borrower’s account, or to the account of such third parties as are designated by the Borrower in a written Disbursement Request. An initial Disbursement of [ ] (the “Initial Disbursement”) will be made on the date hereof (the “Initial Disbursement Date”). The aggregate principal amount of the Loan will be available for Disbursements to be made during the Commitment Period.
(b) Subject to satisfaction of the conditions contained in Article IV, a Disbursement shall be made upon the Borrower’s written disbursement request (a “Disbursement Request”) in the form of Schedule 1, with all blanks properly completed, delivered to the Lender before 12:00 pm New York time on not less than three (3) nor more than five (5) Business Days prior to the proposed date of such Disbursement. Against each Disbursement, the Borrower shall deliver to the Lender a receipt thereof (the “Evidence of Disbursement”) in the form of Schedule 2, with all blanks properly completed, which receipt shall not be effective as to the Borrower until the Disbursement is actually advanced to the Borrower. On the Initial Disbursement Date the Borrower shall execute and deliver the Note, in form of Exhibit A.
(c) The Lender shall not be required to make any Loan if (a) the Commitment Period Expiration Date shall have occurred, or (b) after giving effect thereto, the aggregate outstanding principal amount of the Loans would exceed the Commitment Amount.
(d) Amounts borrowed and repaid or prepaid may not be reborrowed.
9 84216620_4 Section II.4 Repayment. The Borrower shall repay the Loan in full in the amount of the Final Payment on the Final Payment Date.
Section II.5 Prepayments. (a) Voluntary Prepayments. Except as otherwise provided in this Section 2.5, the Borrower shall have the right at any time to prepay, in whole but not in part, the Loan (a “Prepayment”), without any penalty or fee, provided that, at the time of such Prepayment:
(i) the Borrower shall deliver to the Lender a prepayment notice in writing (“Prepayment Notice”) substantially in the form attached as Schedule 3 not less than thirty (30) days prior to the date of the proposed Prepayment;
(ii) any Prepayment Notice delivered shall be irrevocable;
(iii) the Borrower shall pay all accrued interest with respect to the Loan being repaid; and
(iv) the Borrower shall deliver to the Lender, prior to the date of Prepayment, evidence satisfactory to the Lender that all approvals necessary, if any, in respect of the Prepayment have been obtained from all Government Authorities and all other Persons.
(b) Mandatory Prepayments. If, for any Quarterly Period, there shall be Excess Cash Flow, the Borrower shall, on the relevant Excess Cash Flow Application Date, apply the Excess Cash Flow toward the Prepayment of the Loans. Each such Prepayment shall be made on a date (an “Excess Cash Flow Application Date”) no later than five (5) days after the earlier of (i) the date on which the quarterly financial statements of the Borrower referred to in Section 5.1(f), for the Quarterly Period with respect to which such Prepayment is made, are required to be delivered to the Lender and (ii) the date on which such quarterly financial statements are actually delivered. Notwithstanding the foregoing, the Lender and the Borrower y will use their best efforts to renegotiate this Section 2.5(b) not later than ninety (90) days after the Initial Disbursement Date to provide for the distribution of an amount of Excess Cash Flow to the Borrower.
Section II.6 Fees.
(a) Commitment Fee. Borrower shall pay a fee (the “Commitment Fee”) to the Lender in the amount of (i) $[ ] (i.e., the product of 3.0% and the amount of the Initial Disbursement) on the Initial Disbursement Date and (ii) on the date of each Disbursement made to the Borrower hereunder after the Initial Disbursement Date, the product of 3.0% and the amount of such Disbursement. The Commitment Fee shall be deducted by Lender from the proceeds of each Disbursement made to the Borrower under this Agreement.
(b) Extension Fees. If the Borrower chooses to exercise the Extension Option, Borrower shall pay a fee (an “Extension Fee”) to the Lender in an amount equal to the product of 1.0% and the then outstanding balance of the Loan. The Extension Fee
10 84216620_4 shall be due and payable in full in immediately available funds on the Final Payment Date.
Section II.7 Payments. Payments of principal, interest, fees, costs, expenses or any other payment due to the Lender under any provision of any of the Financing Documents shall be made in Dollars in immediately available funds, without deduction, set off or counterclaim, prior to ______time on such date that any such payment is due, at such bank or banks, and in such place or places, as the Lender shall from time to time designate in writing. The Borrower shall pay all and any costs (administrative or otherwise) imposed by banks, clearing houses, or any other financial institution, in connection with making any payments under any of the Financing Documents, except for any costs imposed by the Lender’s banking institutions.
Section II.8 Taxes, Duties and Fees.
(a) The Borrower shall pay or cause to be paid all present and future Taxes (other than Excluded Taxes, if any), duties, fees and other charges of whatsoever nature, if any, now or at any time hereafter levied or imposed by any Government Authority, by any department, agency, political subdivision or taxing or other authority thereof or therein, by any organization of which the applicable Government Authority is a member, or by any jurisdiction through which the Borrower makes payments hereunder, on or in connection with the payment of any and all amounts due under this Agreement, and all payments of principal, interest and other amounts due under this Agreement shall be made without deduction for or on account of any such Taxes, duties, fees and other charges, except for Excluded Taxes, which may be deducted or withheld from payments made by the Borrower only if such deduction or withholding is required by applicable law.
(b) If the Borrower is required to withhold any such amount or is prevented by operation of law or otherwise from paying or causing to be paid such Taxes, duties, fees or other charges as aforesaid except for Excluded Taxes, the principal, interest or other amounts due under this Agreement (as applicable) shall be increased to such amount as shall be necessary to yield and remit to the Lender the full amount it would have received taking into account any such Taxes (except for Excluded Taxes), duties, fees or other charges payable on amounts payable by the Borrower under this Section 2.8(b) had such payment been made without deduction of such Taxes, duties, fees or other charges (all and any of such additional amounts, herein referred to as the “Additional Amounts”).
(c) If Section 2.8(b) above applies and the Lender so requires, the Borrower shall deliver to the Lender official tax receipts evidencing payment (or certified copies of them) of the Additional Amounts within thirty (30) days of the date of payment.
(d) If the Lender receives a refund from the relevant Government Authority to which the Borrower has paid withholding Taxes pursuant to this Section 2.8, the Lender shall pay such refund to the Borrower.
Section II.9 Costs, Expenses and Losses. If, as a result of any failure by the Borrower to pay any sums due under this Agreement on the due date therefor, to borrow in accordance with a request for Disbursement made pursuant to Section 2.3 or to make any
11 84216620_4 Prepayment in accordance with a Prepayment Notice pursuant to Section 2.5(a), the Lender shall incur documented costs, expenses and/or losses, by reason of the liquidation or redeployment of deposits from third parties or in connection with obtaining funds to make or maintain any Disbursement, the Borrower shall pay to the Lender upon request by the Lender, the amount which the Lender shall notify to the Borrower as being the aggregate of such costs, expenses and losses. The Borrower shall pay such documented costs, expenses and/or losses within fifteen (15) days after receipt by it of a certificate from the Lender setting forth in reasonable detail such costs, expenses and/or losses. For the purposes of the preceding sentence, “costs, expenses and/or losses” shall include, without limitation, any interest paid or payable to carry any unpaid amount and any loss, premium, penalty or expense which may be incurred in obtaining, liquidating or employing deposits of or borrowings from third parties in order to make, maintain or fund the Loan or any portion thereof.
Section II.10 Interest Rate.
(a) The Borrower hereby agrees to pay to the Lender interest on the unpaid principal amount of the Loan at the applicable Interest Rate. Interest shall accrue from and including the first day of each Interest Period to but excluding the last day of each Interest Period; and shall be payable in arrears on each Interest Payment Date.
(b) The Loan shall bear interest (calculated on the basis of the actual number of days elapsed in a 360-day year) at a rate per annum equal to LIBOR, plus ______basis points (the “Interest Rate”), which Interest Rate shall be adjusted to reflect changes in LIBOR applicable to each Interest Period as contemplated by Section 2.10(c).
(c) As soon as practicable and in no event later than two Business Days prior to the first Business Day of each Interest Period the Lender shall notify the Borrower of the determination of LIBOR and the Interest Rate applicable for the Interest Period about to commence. Each determination of the Interest Rate by the Lender pursuant to any provision of this Agreement shall be conclusive and binding on the Borrower and the Lender in the absence of manifest error.
Section II.11 Interest on Late Payments. Without limiting the remedies available to the Lender under this Agreement, the other Financing Documents or otherwise, to the maximum extent permitted by applicable law, if the Borrower fails to make any payment of principal or interest with respect to the Loan, the Borrower shall pay, in respect of the outstanding principal amount of the Loan, interest at the rate per annum equal to the Interest Rate plus ______basis points for so long as such payment remains outstanding (the “Default Interest”). Such interest shall be payable on demand, or if not demanded, on each Interest Payment Date after such failure.
Section II.12 Note. The Borrower’s obligation to repay the Loan shall be evidenced by a promissory note of the Borrower, in the form of Exhibit A (the “Note”), payable to the order of the Lender in a maximum principal amount equal to the Commitment Amount. The Borrower hereby irrevocably authorizes the Lender to make (or cause to be made) appropriate notations on the grid attached to such Note (or on any continuation of such grid), which notations, if made, shall evidence, inter alia, the date of, the outstanding principal of, and the interest rate applicable
12 84216620_4 to the Loans evidenced thereby (providing such monies have been extended to the Borrower) and the date and principal amount of any Prepayments made by the Borrower; provided, however, that the failure of the Lender to make any such notations shall not limit, increase or otherwise affect any Obligations of the Borrower.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section III.1 Representations and Warranties of the Borrower. The Borrower represents and warrants as of the date hereof and as of the Disbursement Date unless otherwise expressly waived by the Lender in writing referring to this Section 3.1 in whole or in part as follows:
(a) The Borrower is a limited liability company duly organized and validly existing under the laws of the State of Delaware.
(b) The Borrower is conducting its business in compliance with its Organizational Documents. True and complete copies of all of the Organizational Documents of the Borrower (including all amendments thereto) as currently in effect have been furnished to the Lender and remain in full force and effect with no defaults outstanding thereunder.
(c) The Borrower has full power (limited liability company and other) and authority to enter into each of the Transaction Documents to which it is, or will be, a party and to make the borrowings and the other transactions contemplated hereby. The Borrower has the full power to execute and deliver the Note and to incur the obligations provided for herein and therein, all of which have been duly authorized by all proper and necessary member action; and no consent or approval of Members (other than those consents and approvals already obtained) is required as a condition to the validity or performance of the Transaction Documents.
(d) All of the outstanding membership interests of the Borrower have been duly authorized and validly issued and are fully paid and nonassessable and have not been issued in violation of the Borrower’s Organizational Documents.
(e) The Borrower has all material permits, authorizations, consents, approvals, and licenses of any Government Authority or other Persons required for the conduct of the Business as currently conducted and as proposed to be conducted.
(f) All authorizations, consents, approvals (including exchange control approvals), registrations, exemptions and licenses with or from Government Authorities which are necessary for the validity hereof, the borrowing hereunder, the execution and delivery of the Transaction Documents and the performance by the Borrower of its obligations hereunder and thereunder, including, without limitation, the remittance in Dollars of any amounts due and payable to the Lender hereunder or thereunder, have been effected or obtained and are in full force and effect.
13 84216620_4 (g) This Agreement and each other Transaction Document has been duly authorized, executed and delivered by the Borrower, are in full force and effect and constitute the valid and legally binding obligation of the Borrower, enforceable in accordance with their respective terms, except as such enforceability may be limited by (i) applicable insolvency, bankruptcy, reorganization, moratorium or other similar laws affecting creditors’ rights generally, and (ii) applicable equitable principles (whether considered in a proceeding at law or in equity).
(h) No Default or Event of Default (or any other default or event of default, however described) has occurred under any of the Transaction Documents.
(i) Neither the entering into any Transaction Document nor the compliance with any of its respective terms conflicts with, violates or results in a breach of any of the terms, conditions or provisions of, or constitutes a default or event of default (however described) or requires any consent under, any indenture, mortgage, agreement or other instrument or arrangement to which the Borrower is a party or by which it is bound, or violates any of the terms or provisions of the Organizational Documents of the Borrower or any judgment, decree, resolution, award or order or any statute, rule or regulation applicable to the Borrower.
(j) The Borrower is not engaged in or the subject of any material litigation, arbitration, administrative regulatory compliance proceedings, or investigations, nor are there any litigation, arbitration, administrative regulatory compliance proceedings or investigations pending or, to the knowledge of the Borrower, threatened before any court or arbitrator or before or by any Government Authority against the Borrower, and the Borrower is not aware of any facts likely to give rise to any such proceedings.
(k) The Borrower (i) is capable of paying its debts as they fall due and is not unable and has not admitted its inability to pay debts as they fall due, (ii) is not bankrupt or insolvent and (iii) has not taken action, and no such action has been taken by a third party, for the Borrower’s winding up, dissolution, or liquidation or similar executory or judicial proceeding or for the appointment of a liquidator, custodian, receiver, trustee, administrator or other similar officer for the Borrower or any or all of its property, assets or revenues.
(l) Neither the Borrower nor or any of its Managing Member, officers, employees or agents have at any time engaged in Corrupt Practices or Fraudulent Practices.
(m) Upon its issuance, the Note shall be a legal, valid and binding instrument of the Borrower, enforceable against the Borrower in accordance with its terms and applicable law, except as such enforceability may be limited by (i) applicable insolvency, bankruptcy, reorganization, moratorium or other similar laws affecting creditors’ rights generally, and (ii) applicable equitable principles (whether considered in a proceeding at law or in equity), and shall enable the holder thereof to enforce the Note in accordance with their terms with respect to the Loan, Loan interest, fees or financial obligations that remains unpaid under this Agreement or any other Financing Document.
14 84216620_4 (n) The obligation of the Borrower to make any payment under this Agreement (together with all interest accrued thereon and other charges in connection therewith) is absolute and unconditional, and there exists no right of setoff or recoupment, counterclaim, cross-claim or defense of any nature whatsoever to any payments.
(o) The Borrower has clean, unencumbered title to the Collateral except for the Permitted Liens.
(p) The provisions of the Security Agreement are effective to create in favor of the Lender a legal, valid and enforceable security interest in and Lien on the Collateral described therein, and the Security Agreement (upon the filing of appropriate financing statements in Delaware related thereto), creates, as security for the obligations purported to be secured thereby, a valid and enforceable perfected security interest in and Lien on the Collateral in favor of the Lender, superior to and prior to the rights of all third persons (except that the security interest and Lien created in the Collateral may be subject to the Permitted Liens related thereto) and subject to no other Liens.
Section III.2 Borrower Acknowledgment. The Borrower acknowledges that it has made the representations and warranties referred to in Section 3.1 with the intention of persuading the Lender to enter into this Agreement and the other Financing Documents and that the Lender has entered into this Agreement and each other Financing Document on the basis of, and in full reliance on, each of such representations. The Borrower represents and warrants to the Lender that none of such representations and warranties omits any matter the omission of which makes any of such representations and warranties misleading.
Section III.3 No-Estoppel Provision. The rights and remedies of the Lender in relation to any misrepresentations or breach of warranty on the part of the Borrower shall not be prejudiced by any investigation by or on behalf of the Lender into the affairs of the Borrower, by the execution or the performance of this Agreement or by any other act or thing which may be done by or on behalf of the Lender in connection with this Agreement and which might, apart from this Section 3.3, prejudice such rights or remedies.
ARTICLE IV
CONDITIONS OF DISBURSEMENTS
Section IV.1 Conditions to Initial Disbursement of the Loan. The obligation of the Lender to make the Initial Disbursement of the Loan shall be subject to the fulfillment, in a manner satisfactory to the Lender in its sole discretion, unless otherwise expressly waived by the Lender in writing referring to this Section 4.1 in whole or in part, prior to or concurrently with the making of such Initial Disbursement of the following conditions:
(a) The Lender shall have completed, with results satisfactory to the Lender, its due diligence with respect to the Borrower, including, without limitation, any legal, environmental, technical, financial, market, rating or technical studies.
15 84216620_4 (b) The Lender shall have received a copy of the resolution of each Member and all documents evidencing any other necessary action of the Borrower, authorizing the Borrower to execute, deliver and perform this Agreement and/or each of the other Transaction Documents and to engage in the transactions contemplated hereby and thereby.
(c) Each of the Transaction Documents shall be in form and content satisfactory to the Lender and shall have been duly executed and delivered by the parties thereto and shall be in full force and effect and the parties thereto shall be in compliance with all the terms and conditions thereof.
(d) Such other conditions as the Lender shall determine, in the exercise of its sole discretion.
Section IV.2 Conditions to All Disbursements of the Loan. The obligation of the Lender to make any Disbursement of the Loan (including the Initial Disbursement) shall be subject to the fulfillment, in a manner satisfactory to the Lender in its sole discretion, prior to or concurrently with the making of such Disbursement of the following conditions:
(a) The Borrower shall have delivered to the Lender a Disbursement Request substantially in the form of Schedule 1 hereto not less than three (3) nor more than five (5) Business Days prior to the proposed Disbursement Date.
(b) The Borrower shall have delivered to the Lender the relevant Evidence of Disbursement substantially in the form of Schedule 2 hereto, as set forth in Section 2.3 hereof, duly executed by the Borrower, provided that such receipt shall not be effective as to the Borrower until the Disbursement is actually advanced to the Borrower.
(c) The Borrower shall have each complied with and shall then be in compliance with all the terms, covenants and conditions of the Transaction Documents which are binding upon it.
(d) No Default or Event of Default shall have occurred and be continuing under any Transaction Document, nor shall any event have occurred that, with notice or the passage of time, would reasonably be likely to become a Default or an Event of Default.
(e) No Material Adverse Effect, nor any event that could reasonably be expected to have a Material Adverse Effect, shall have occurred and be continuing since the date of this Agreement.
(f) The representations and warranties confirmed or made in each Transaction Document shall be true on and as of the date of the Disbursement with the same effect as though such representations and warranties had been made on and as of the date of such Disbursement.
(g) The Lender shall have received from the Borrower or been authorized by the Borrower to deduct from such Disbursement payment in full of all fees and other
16 84216620_4 amounts due under the Financing Documents, including without limitation, the Commitment Fee and the Taxes (if any) (except for Excluded Taxes), fees and expenses of the Lender’s counsel in accordance with Section 7.4 to the extent such costs are not paid by the Borrower
(h) Such other conditions as the Lender shall determine, in the exercise of its sole discretion.
Section IV.3 Effect of Disbursement Request. The delivery of a Disbursement Request and the acceptance by the Borrower of the proceeds of such Disbursement shall constitute a representation and a warranty by the Borrower that on the date of such Disbursement (both immediately before and after giving effect to such Disbursement and the application of the proceeds thereof) the statements made in Section 4.2 are true and correct.
Section IV.4 Saving Rights.
(a) No course of dealing or waiver by the Lender in connection with any condition of Disbursement under this Agreement shall impair any right, power or remedy of the Lender with respect to any other condition of Disbursement, or be construed to be a waiver thereof; nor shall the action of the Lender in respect of any Disbursement affect or impair any right, power or remedy of the Lender in respect of any other Disbursement.
(b) Unless otherwise notified to the Borrower by the Lender and without prejudice to the generality of this Section 4.4(b), the right of the Lender to require compliance with any condition under this Agreement which may be waived by the Lender in respect of any Disbursement is expressly preserved for the purposes of any subsequent Disbursement.
ARTICLE V
PARTICULAR COVENANTS
Section V.1 Affirmative Covenants. Unless the Lender shall otherwise agree:
(a) The Borrower shall (i) maintain its existence and qualify and remain qualified to do business as currently conducted; (ii) maintain all approvals necessary for the Loan and the Financing Documents; and (iii) operate its business with due diligence, efficiency and in conformity with sound business practices, including, without limitation, keeping all physical facilities and equipment needed for the effective conduct of its business in good operating condition, subject to ordinary wear and tear and the right to dispose of obsolete or worn out equipment.
(b) The Borrower shall (i) keep its properties and business insured with financially sound and reputable insurers against loss or damage in such manner and to the same extent as shall be no less than that generally accepted as customary in regard to property and business of like character; and (ii) punctually pay any premium, commission
17 84216620_4 and any other amount necessary for effectuating and maintaining in force each insurance policy required pursuant hereto.
(c) The Borrower shall comply in all material respects with (i) all applicable laws, rules, regulations and orders of any Government Authority, and (ii) all Environmental Laws, including, without limitation, applicable Environmental Laws relating to indigenous peoples, involuntary resettlement, cultural property protection and any child labor and forced labor laws, rules and regulations (if applicable).
(d) The Borrower shall take all necessary action to permit the Lender’s representatives (with prior written notice to the Borrower) to (i) visit the premises of the Borrower, and its facilities, (ii) meet with the Borrower’s Managing Member, officers, employees, and agents, and (iii) have reasonable access to the Borrower’s books and the Borrower’s Auditors during working hours and on working days, provided that, so long as no Event of Default has occurred and is continuing, the Lender gives the Borrower written notice two (2) Business Days in advance of such visit, meeting or access. Any information received by the Lender pursuant to this paragraph shall be subject to the confidentiality restrictions provided for in Section 7.12.
(e) The Borrower shall promptly install and maintain records, books, management information systems and financial control procedures which together are adequate to: (i) support the accounting practices and tax elections of the Borrower; (ii) record and monitor the use of the Loan proceeds in accordance with Section 2.1; and (iii) accurately, adequately and fairly reflect the financial condition of the Borrower and the results of its operations in conformity with U.S. GAAP.
(f) The Borrower shall provide the Lender (i) unaudited quarterly Financial Statements within forty-five (45) days after the end of each quarter; (ii) annual Financial Statements audited by the Auditors within one hundred twenty (120) days after the end of each Fiscal Year (together with a Compliance Certificate); (iii) cashflow statements within forty-five (45) days after the end of each quarter; (iv) an annual written report prepared by the Borrower’s Managing Member reflecting a detailed listing of the Collateral as of the last day of each fiscal year of the Borrower; and (v) such other information as the Lender may reasonably request promptly following each request.
(g) The Borrower shall pay and discharge all Taxes (other than Excluded Taxes), assessments and governmental charges upon it, its income and its properties prior to the date on which penalties are attached thereto, unless and only to the extent that (i) such Taxes, assessments and governmental charges shall be contested in good faith and by appropriate proceedings by Borrower; (ii) reserves which are adequate under U.S. GAAP are maintained by Borrower with respect thereto; and (iii) any failure to pay and discharge such Taxes, assessments and governmental charges would not have and could not reasonably be expected to have a Material Adverse Effect.
(h) The Borrower shall promptly inform the Lender, in writing, of any proposed material change in the nature or scope of the Business or operations of the
18 84216620_4 Borrower, any event or condition which has or could reasonably be expected to have a Material Adverse Effect.
(i) The Borrower shall comply with the requirements of all applicable laws, rules, regulations, and orders of any Government Authority, a breach of which would or would reasonably be expected to result in a Material Adverse Effect.
(j) The Borrower shall obtain, make and keep in full force and effect all licenses, contracts, consents, approvals and authorizations from and registrations with Government Authorities that may be required to conduct its business, to maintain compliance with all applicable laws and regulations, and remit monies payable pursuant to this Agreement and each other Financing Document.
(k) The Borrower shall promptly notify the Lender of the occurrence of (i) any Default or Event of Default; (ii) any event, development or circumstance whereby the Financial Statements most recently furnished to the Lender fail in any material respect to present fairly and accurately, in accordance with U.S. GAAP, the financial condition and operating results of the Borrower as of the date of such Financial Statements; (iii) any material litigation or proceedings that are instituted or threatened against the Borrower or any of its assets; (iv) each and every event which, at the giving of notice, lapse of time, determination of materiality or fulfillment of any other applicable condition (or any combination of the foregoing), would constitute an event of default (however described) under any of the Transaction Documents; and (v) any other development in the business or affairs of the Borrower if the effect thereof might have a Material Adverse Effect.
(l) The Borrower shall comply with the other Transaction Documents, in addition to this Agreement.
(m) The Borrower shall inform the Lender, as soon as they are made, of any claims, litigation, arbitration, mediation or administrative or regulatory proceedings made or instituted against the Borrower where the amount in controversy exceeds ______Dollar for each such claim.
(n) The Borrower shall notify the Lender as soon as possible, but not more than five (5) days after the occurrence, of any significant incident, such as explosions, spills, discharges, releases or workplace accidents resulting in death, serious injury or major pollution impacts, specifying on and off-site impacts from the incident and measures it is taking or plans to take to address such impacts, and keep the Lender informed on the on-going implementation of such measures.
(o) The Borrower shall keep a membership unit transfer book in which shall be recorded the name and address of each Member and such other information required by applicable law regarding each Member.
(p) The Borrower shall execute such other and further documents and instruments as the Lender may reasonably request to implement the provisions of this Agreement.
19 84216620_4 Section V.2 Negative Covenants. Unless the Lender shall otherwise agree:
(a) The Borrower shall not change its Fiscal Year.
(b) The Borrower shall not modify its Organizational Documents in any manner.
(c) (A) the Borrower shall not enter into any Non-Arms-Length Transaction (as determined by the Lender promptly in advance in its reasonable discretion); and (B) the Borrower shall not make any related party payments, such as management fees, royalties, license payments, compensation or similar payments, except as agreed in writing by the Lender.
(d) The Borrower shall not undertake or permit, without the agreement of the Lender, any (i) merger, consolidation or transfer of Common Interests resulting in the creation of a wholly-owned subsidiary, or vice versa; (ii) any conversion of the Borrower into another form; or (iii) any sale, transfer, lease or exchange or other action with respect to the disposal of, or disposition of rights to, any assets or business lines of the Borrower in a single transaction or series of transactions outside of the Borrower’s ordinary course of business.
(e) The Borrower shall not liquidate or dissolve or enter into any consolidation, merger, spin-off, consolidation or reorganization, or acquire the assets or stock of any other business or company or enter into any partnership, joint venture, syndicate, pool, profit-sharing or royalty agreement or other combination, or engage in any transaction with an Affiliate, whereby its income or profits are, or might be shared with any other Person, or enter into any management contract or similar arrangement whereby its business or operations are managed by another Person.
(f) The Borrower shall not make any change to the scope or nature of its business activities as intended to be carried on at the date hereof or undertake any operations not permitted by the Transaction Documents.
(g) The Borrower shall not establish a subsidiary (including, without limitation, a Subsidiary) or acquire any equity interests in any other entity or enter into any agreement to acquire any stock obligations or securities of or any other interest in or make any capital contribution to any other Person without the prior written consent of the Lender.
(h) The Borrower shall not (i) other than with respect to the transactions contemplated by this Agreement and the Transaction Documents, enter into any agreement or arrangement to guarantee or, in any way or under any condition, to become obligated for all or any part of any financial or other obligation of another Person; (ii) create, incur or suffer any Lien upon any of its assets, now owned or hereafter acquired, except Permitted Liens; or (iii) assign, sell, transfer or otherwise dispose of, or terminate, waive or amend any of the Transaction Documents, or the rights and obligations thereunder or hereunder, or request or consent to any such assignment, sale, transfer, disposition, waiver or amendment.
20 84216620_4 (i) The Borrower shall not make or permit to exist, loans or advances to, or deposits (except commercial bank deposits in the ordinary course of business) with, other Persons or investments in any Person or enterprise other than Permitted Investments.
(j) Except as expressly provided herein, the Borrower shall not make any prepayment or repurchase any Debt (other than the Loan), or make any repayment of such Debt pursuant to any provision of any agreement or note which provides directly or indirectly for acceleration of repayment in time or amount unless the Borrower first prepays the Loan or such prepayment, repurchase or repayment is approved by the Lender.
(k) The Borrower shall not (i) violate any laws, ordinances, government rules or regulations to which it is subject or (ii) fail to obtain or maintain any patents, trademarks, service marks, trade names, copyrights, design patents, licenses, permits, franchises or other governmental authorizations necessary to ownership of its property or the conduct of its Business, in either case where such failure would have or could reasonably be expected to have a Material Adverse Effect.
(l) Except as otherwise approved by the Lender, the Borrower shall not create, incur, assume, or suffer to exist any lease obligation other than lease obligations in the ordinary course of its business.
(m) Except as required by applicable law, the Borrower shall not declare or pay any dividends, issue or sell any securities, make any Restricted Payment, or distribute or otherwise transfer to Members any money in cash or kind on any Common Interests, including, without limitation, any payments under any agreements between the Borrower and its Members, whether in writing or otherwise, after the occurrence and during the continuance of an Event of Default.
(n) The Borrower shall not assign or otherwise transfer, terminate, waive or amend any of the Transaction Documents without the prior consent of the Lender, except for amendment in the ordinary course of business.
(o) The Borrower shall not modify the accounting practices followed by it, other than as contemplated herein and except in accordance with applicable generally accepted accounting principles, or change its external auditors, without consent from the Lender.
(p) The Borrower shall not grant any Liens (other than Permitted Liens) or incur any Debt other than in the ordinary course of business.
(q) The Borrower shall not sell, transfer, assign, sell, encumber or otherwise dispose of the title or other ownership rights to any of the Collateral or any of its other assets having a value in excess of ______Dollar without the prior written consent of the Lender.
Section V.3 Reimbursement of Taxes. The Borrower shall pay all Taxes (including, without limitation, stamp taxes), duties, fees or other charges payable on or in connection with
21 84216620_4 the execution, issue, delivery, registration, notarization or enforcement of this Agreement and the other Financing Documents and shall, upon notice from the Lender, reimburse the Lender for any such Taxes, duties, fees or other charges paid by the Lender thereon; provided, however, that notwithstanding the foregoing, under no circumstances shall the Borrower have any obligation to reimburse the Lender for Excluded Taxes.
ARTICLE VI
EVENTS OF DEFAULT
Section VI.1 General Acceleration Provision upon Events of Default. If one or more of the events specified in this Section 6.1 (each an “Event of Default”) shall have happened and be continuing beyond the applicable cure period, the Lender, by written notice to the Borrower, may cancel the Borrower’s right to request Disbursements and declare the principal of, and all accrued interest and fees on, the Loan or any part of any of them (together with any other amounts accrued or payable under this Agreement) to be, and the same shall thereupon become, immediately due and payable without prepayment premium without any further notice and without any presentment, demand or protest of any kind, all of which are hereby expressly waived by the Borrower, and take any further action available at law or in equity, including, without limitation, the sale of the Loan and all other rights acquired in connection with the Loan:
(a) The Lender shall have failed to receive payment when due of principal, interest, fees or any other amounts due under the Loan or the Note and such failure continues for a period of five (5) days after the due date thereof.
(b) The Borrower shall have defaulted or failed to comply in any material respect with the due observance or performance of any covenant contained in this Agreement or in any Transaction Document, or any other document or agreement between the Lender and the Borrower, and such failure to comply shall continue uncured for fifteen (15) days after the delivery of written notice of such default or failure from the Lender.
(c) Any representation or warranty made by the Borrower in this Agreement or any other Transaction Document shall be found to have been incorrect, false or misleading in any material respect as of the date it was made, deemed made, reaffirmed or confirmed.
(d) Any Government Authority shall have condemned, nationalized, seized, confiscated or otherwise expropriated all or any substantial part of the property or other assets or membership interest of the Borrower, or shall have assumed custody or control of such property or other assets or of the business or operations or membership interest, or shall have taken any action for the dissolution or disestablishment of the Borrower or any action that would prevent the Borrower from meeting its obligations to the Lender under the Financing Documents.
(e) (i) The Borrower shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts as they come due or shall make
22 84216620_4 a general assignment for the benefit of creditors; (ii) the Borrower shall declare a moratorium on the payment of its debts; (iii) the commencement by the Borrower of proceedings to be adjudicated bankrupt or insolvent, or the consent by it to the commencement of bankruptcy or insolvency proceedings against it, or the filing by it of a petition or answer or consent seeking reorganization, intervention or other similar relief under any applicable law, or the consent by it to the filing of any such petition or to the appointment of an intervenor, receiver, liquidator, assignee, trustee, sequestrator (or other similar official) or of any substantial part of its assets; (iv) the commencement against the Borrower or any substantial part of its assets of a proceeding in any court of competent jurisdiction under any bankruptcy or other applicable law (as now or hereafter in effect) seeking its liquidation, winding up, dissolution, reorganization, arrangement, adjustment, or the appointment of an intervenor, receiver, liquidator, assignee, trustee, sequestrator (or other similar official), and any such proceeding shall continue undismissed, or any order, judgment or decree approving or ordering any of the foregoing shall continue unstayed or otherwise in effect, for a period of ninety (90) days; (v) the making by the Borrower of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debt generally as they become due; or (vi) any other event shall have occurred which under any applicable law would have an effect analogous to any of those events listed above in this subsection.
(f) The Borrower shall have failed to make any payment when due (whether at stated maturity, by acceleration or otherwise) or otherwise to perform its obligations under any Debt (other than the Loan) or under any agreement pursuant to which there is outstanding any Debt of the Borrower and such failure shall have continued for more than the applicable grace period (if any), and such Debt shall be in an aggregate amount of at least ______Dollars or its equivalent.
(g) One or more judgments against the Borrower taken as a whole or attachments against any of their respective property, which in the aggregate exceed ______Dollars or its equivalent in local operating currency, or which could reasonably expected to interfere materially and adversely with the conduct of the Business of the Borrower remain(s) unpaid, unstayed on appeal, undischarged, unbonded or undismissed for a period of thirty (30) days from the date of entry of such judgment.
(h) This Agreement or any other Transaction Document (or any component thereof relating to payment obligations, enforcement rights or other material rights or other material obligations) is or shall have become invalid, illegal or unenforceable.
(i) Any license, permit or approval held by the Borrower shall have been suspended, canceled or revoked, except to the extent such suspension, cancellation or revocation does not and could not reasonably be expected to have a Material Adverse Effect.
(j) Any authorization necessary for the execution, delivery or performance of this Agreement or any other Transaction Document or for the validity or enforceability of any of the Borrower’s obligations under this Agreement or any other Transaction
23 84216620_4 Document is not effected or given or is withdrawn or ceases to remain in full force or effect.
(k) The validity of this Agreement or any other Transaction Document shall be contested by any legislative, executive or judicial body of any jurisdiction, or any treaty, law, regulation, communiqué, decree, ordinance or policy of any jurisdiction shall purport to render any material provision of this Agreement or any other Transaction Document invalid or unenforceable or shall purport to prevent or materially delay the performance or observance by the Borrower of its obligations hereunder or thereunder (as applicable).
Section VI.2 Automatic Acceleration on Dissolution or Bankruptcy. Notwithstanding any other provisions of this Agreement, if an Event of Default under Section 6.1(e) shall occur, the principal of and all accrued interest on, the Loan (together with any other amounts accrued or payable under this Agreement) shall thereupon become immediately due and payable without any presentment, demand, protest or notice of any kind, all of which are hereby expressly waived by the Borrower.
Section VI.3 Recovery of Amounts Due. If any amount payable hereunder is not paid as and when due, the Borrower hereby authorizes the Lender to proceed, to the fullest extent permitted by applicable law, without prior notice, by right of set-off, banker’s lien or counterclaim, against any moneys or other assets of the Borrower to the full extent of all amounts payable to the Lender.
24 84216620_4 ARTICLE VII
MISCELLANEOUS
Section VII.1 Board Observation Rights. The Lender shall have the right to have one (1) representative present at all meetings of the management board or committees of the Borrower so long as any amounts are outstanding under this Agreement, the Note or any other Transaction Document. Such representative will not enjoy the full rights of a member of such board or committee, but will be entitled to all information provided to such board or committee.
Section VII.2 Notices. Any notice, request or other communication to be given or made under this Agreement to the Parties shall be in writing. Such notice, request or other communication shall be deemed to have been duly given or made when it shall be delivered by hand, international courier (confirmed by facsimile), or facsimile (with a hard copy delivered within two (2) Business Days) to the Party to which it is required or permitted to be given or made at such Party’s address specified below or at such other address as such Party shall have designated by notice to the Party giving or making such notice, request or other communication, it being understood that the failure to deliver a copy of any notice, request or other communication to whom copies are to be sent shall not affect the validity of any such notice, request or other communication or constitute a breach of this Agreement.
For the Borrower:
______
with a copy (which shall not constitute notice) to:
For the Lender:
______
with a copy (which shall not constitute notice) to:
Section VII.3 Waiver of Notice. Whenever any notice is required to be given to the Lender or the Borrower under the provisions of this Agreement or any of the Transaction Documents, a waiver thereof in writing signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.
Section VII.4 Reimbursement of Legal and Other Expenses.
25 84216620_4 (a) The Borrower shall pay to the Lender or to such other Person as the Lender may direct in writing the reasonable fees and expenses of the Lender’s legal counsel, technical consultants and market consultants, including, without limitation, the reasonable out- of-pocket expenses incurred by the Lender, whether or not the Loan is disbursed, which fees and expenses shall be paid promptly after the receipt by the Borrower of an invoice thereof, incurred in connection with: (i) the preparation, review, execution and, where appropriate, filing of any Financing Documents, including, without limitation, the performance of legal due diligence; (ii) the fulfillment of disbursement conditions; (iii) the giving of any legal opinions required by the Lender hereunder or with respect to the Transaction Documents; and (iv) any amendment or modification to, or waiver under, this Agreement or any other Transaction Document (whether proposed or effected), but excluding any fees payable pursuant to Section 2.6, which fees shall be payable as provided in such Section (collectively, “Expenses”). Such Expenses as have accrued up to the time of the Initial Disbursement shall be paid on the Initial Disbursement Date. In addition, the Borrower shall pay the reasonable out-of-pocket expenses incurred by the Lender and its advisors in documenting and monitoring this transaction. All Expenses as accrued after the time of the Initial Disbursement shall be paid promptly by the Borrower directly to the Lender or the Lender’s legal counsel as directed by the Lender. Notwithstanding the foregoing, the Borrower shall not be required to pay Expenses incurred as of the Initial Disbursement Date which exceed in the aggregate the total of ______Dollars.
(b) If any amount owing to the Lender under this Agreement or any other Transaction Document shall be collected through enforcement of this Agreement, any refinancing or restructuring of the Loan in the nature of a work-out, settlement, negotiation, or any process of law, or shall be placed in the hands of third Persons for collection, the Borrower shall pay (in addition to all monies then due in respect of the Loan or otherwise payable under this Agreement or any other Financing Document) documented attorneys’ and other fees and expenses incurred in respect of such collection.
(c) The Borrower shall pay any other reasonable out-of-pocket expenses (excluding the allocated overhead for the Lender’s in-house personnel, including, but not limited to, the Lender’s in-house counsel) incurred by the Lender in connection with the Loan after the date of this Agreement promptly after the receipt of an invoice therefor.
Section VII.5 Applicable Law and Consent to Non-Exclusive New York Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, United States of America, without giving effect to the conflicts of laws principles thereof other than Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York.
(a) This Agreement and the other Transaction Documents, and any rights of the Lender arising out of or relating to this Agreement or any other Financing Documents, may, at the option of the Lender, be enforced by the Lender in the courts of the United States of America located in the Southern District of the State of New York or in any other courts having jurisdiction. For the benefit of the Lender, the Borrower hereby irrevocably agrees that any legal action, suit or proceeding arising out of or relating to this Agreement or any other Financing Document may be brought in the courts of the State of New York or of the United States of America for the Southern District of New York. By the execution and delivery of this
26 84216620_4 Agreement, the Borrower hereby irrevocably consents and submits to the jurisdiction of any such court in any such action, suit or proceeding. Final judgment against the Borrower in any such action, suit or other proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment. Nothing contained herein or in any other Financing Document shall affect the right of the Lender to commence legal proceedings or otherwise sue the Borrower in any court having jurisdiction, or concurrently in more than one jurisdiction, or to serve process, pleadings and other legal papers upon the Borrower in any manner authorized by the laws of any such jurisdiction.
(b) The Borrower irrevocably waives, to the fullest extent permitted by applicable law, any objection which it may now or hereafter have to the laying of venue of any action, suit or other proceeding arising out of or relating to this Agreement or any other Financing Document, brought in the courts of the State of New York or in the United States District Court for the Southern District of New York, and any claim that any such action, suit or other proceeding brought in any such court has been brought in an inconvenient forum.
(c) The Borrower hereby waives any and all rights to demand a trial by jury in any action, suit or other proceeding arising out of or relating to this Agreement or any other Financing Document or the transactions contemplated by this Agreement or any other Financing Document.
(d) To the extent that the Parties may, in any suit, action or other proceeding brought in any court arising out of or in connection with this Agreement or any other Financing Document, be entitled to the benefit of any provision of law requiring the Borrower or the Lender, as applicable, in such suit, action or other proceeding to post security for the costs of the Borrower or the Lender, as applicable, or to post a bond or to take similar action, the Parties hereby irrevocably waive such benefit, in each case to the fullest extent now or hereafter permitted under any applicable laws.
(e) To the extent that the Parties may be entitled in any jurisdiction to claim for itself or its assets immunity with respect to its obligations under this Agreement or any other Financing Document from any suit, execution, attachment (whether in aid of execution, before judgment or otherwise) or other legal process or to the extent that in any jurisdiction there may be attributed to itself or its assets such immunity (whether or not claimed), or to the extent it might have the right to have a jury trial, the Parties hereby irrevocably waive and agree not to, as applicable, claim or exercise, such immunity and right to jury trial to the fullest extent permitted by the laws of such jurisdiction.
Section VII.6 Successor and Assigns. This Agreement shall bind and inure to the respective successors and assigns of the Parties, except that the Borrower may not assign or otherwise transfer all or any part of its rights or obligations under this Agreement without the prior written consent of the Lender.
Section VII.7 Entire Agreement. This Agreement and the other Financing Documents contain the entire understanding of the Parties with respect to the matters covered hereby and supersede any and all other written and oral communications, negotiations, commitments and writings with respect thereto. The provisions of this Agreement may be waived, modified,
27 84216620_4 supplemented or amended only by an instrument in writing signed by the authorized officer of each Party; provided that any provision hereof that is solely for the Lender’s benefit may be waived by written instrument signed by an authorized officer of the Lender.
Section VII.8 Amendments. Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed by the Parties and Natole.
Section VII.9 Severability. In case any one or more of the provisions contained in this Agreement shall be invalid, illegal or unenforceable in any respect under any law, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby. The Parties shall endeavor in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.
Section VII.10 Counterparts. This Agreement may be executed in several counterparts, and by each Party on separate counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement.
Section VII.11 Survival.
(a) This Agreement and all agreements, representations and warranties made hereunder, in the other Financing Documents, and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall be considered to have been relied upon by the other Parties and shall survive the execution and delivery of this Agreement and the making of the Loan hereunder regardless of any investigation made by any such other Party or on its behalf, and shall continue in force until all amounts payable under the Financing Documents shall have been fully paid in accordance with the provisions hereof and thereof, and the Lender shall not be deemed to have waived, by reason of making the Loan, any Default that may arise by reason of such representation or warranty proving to have been false or misleading, notwithstanding that the Lender may have had notice or knowledge of any such Default or may have had notice or knowledge that such representation or warranty was false or misleading at the time such Disbursement was made hereunder.
(b) The obligations of the Borrower under Section 2.8 and Section 2.9, and the obligations of the Borrower and the Lender under this Article VII hereof shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loan, or the termination of this Agreement or any provision hereof.
Section VII.12 Confidential Information.
(a) Except as required by law, the Lender will keep confidential during the term of this Agreement and for a period of two (2) years thereafter, all Confidential Information received from the Borrower, and will disclose it on a confidential and need-to-know basis only to: (i) Affiliates of the Lender, and such Affiliates’ investment advisers and the directors, officers, employees, Investment Committee members, Affiliates, counsel, advisors and consultants, the Lender’s Affiliates’ investment advisor; and the limited partners and potential limited partners of the Lender’s Affiliates (collectively “Lender Affiliates”); and (ii) such other
28 84216620_4 Persons as may be required pursuant to any loan agreements entered into by any Lender Affiliate with its funding sources and any other Person necessary to receive the formal approval of the Investment Committee and Board of Directors of any Lender Affiliate. Notwithstanding the foregoing, the Lender may disclose, in connection with promotional or fund raising efforts with financial investors in the ordinary course of its business, the name of the Borrower, industry sector of the Borrower (including a brief transaction description); the role of the Lender and amount and nature of Lender support (including basic financial terms and conditions, including the Loan tenor and interest rate); and the Disbursement Date. If the Lender discloses any Confidential Information pursuant to this Section, the Lender shall instruct each recipient of the confidential nature of such information and shall require each such recipient to cause such information to be treated in substantially the same manner that its own confidential information is treated.
(b) Notwithstanding any other provisions of this Section 7.12, the Lender may disclose to any Person for the purpose of exercising any power, remedy, right or authority under this Agreement or any other Transaction Document in connection with an Event of Default, any documents or records of, or information about, any Financing Document, or the assets, business or affairs of the Borrower. The Borrower acknowledges and agrees that, notwithstanding the terms of any other agreement between the Borrower and the Lender, a disclosure of Confidential Information by the Lender in the circumstances contemplated by this Section 7.12 does not violate any duty owed to the Borrower or agreement between the Lender and the Borrower in such capacities.
Section VII.13 [Intentionally Omitted]
Section VII.14 Waiver. Neither the failure of, nor any delay on the part of, any Party in exercising any right, power or privilege hereunder, or under any agreement, document or instrument mentioned herein, shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege hereunder, or under any agreement, document or instrument mentioned herein, preclude other or further exercise thereof or the exercise of any other right, power or privilege; nor shall any waiver of any right, power, privilege or default hereunder, or under any agreement, document or instrument mentioned herein, constitute a waiver of any other right, power, privilege or default or constitute a waiver of any default of the same or of any other term or provision. No course of dealing and no delay in exercising, or omission to exercise, any right, power or remedy accruing to the Lender upon any default under this Agreement, or any other agreement shall impair any such right, power or remedy or be construed to be a waiver thereof or an acquiescence therein; nor shall the action of the Lender in respect of any such default, or any acquiescence by it therein, affect or impair any right, power or remedy of the Lender in respect of any other default. All rights and remedies herein provided are cumulative and not exclusive of any rights or remedies otherwise provided by law.
Section VII.15 Indemnity.
(a) The Parties shall, at all times, indemnify and hold each other harmless (the “Indemnity”) and each of their respective directors, members, officers, employees, agents, counsel and advisors (each, an “Indemnified Person”) in connection with any losses, claims (including the cost of defending against such claims), damages, liabilities, penalties, or other
29 84216620_4 expenses arising out of, or relating to, this Agreement, the other Transaction Documents, the extension of credit hereunder or the Loan, the use or intended use of the Loan or any investment or proposed investment, which an Indemnified Person may incur or to which an Indemnified Person may become subject (each, a “Loss”). The Indemnity shall not apply to the extent that a court or arbitral tribunal with jurisdiction over the subject matter of the Loss, and over the Lender or the Borrower, as applicable, and such other Indemnified Person that had an adequate opportunity to defend its interests, determines that such Loss resulted from the gross negligence or willful misconduct of the Indemnified Person, which determination results in a final, non- appealable judgment or decision of a court or tribunal of competent jurisdiction. The Indemnity is independent of and in addition to any other agreement of any party hereunder or under any Transaction Document to pay any amount to the Lender or the Borrower, as applicable, and any exclusion of any obligation to pay any amount under this paragraph shall not affect the requirement to pay such amount under any other section hereof or under any other agreement.
(b) The Borrower and the Lender, as applicable, shall not assert on any theory of liability any claim against any Indemnified Person for special, indirect, consequential or punitive damages arising out of or otherwise relating to the Financing Documents or to any of the transactions contemplated therein or the actual or proposed use of the Loan.
(c) Without prejudice to the survival of any other agreement of any of the Parties hereunder, the agreements and the obligations of the Parties contained in this Section 7.15 shall survive the termination of each other provision hereof and the payment of all amounts payable to the Lender hereunder.
Section VII.16 No Usury. This Agreement, the Notes and all other Financing Documents are hereby expressly limited so that in no contingency or event whatsoever, whether by reason of acceleration or otherwise, shall the amount paid or agreed to be paid to the Lender for the Loan exceed the maximum amount permissible under applicable law. If from any circumstance whatsoever fulfillment of any provision hereof, at the time performance of such provision shall be due, shall involve transcending the limit of validity prescribed by law, then, ipso facto, the obligation to be fulfilled shall be reduced to the limit of such validity, and if from any such circumstance the Lender shall ever receive interest, or anything which might be deemed interest under applicable law, that would exceed the highest lawful rate, such amount that would be excessive interest shall be applied to the reduction of the principal amount owing on account of the Loan and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal of the Loan, such excess shall be refunded to the Borrower. All sums paid or agreed to be paid to the Lender for the Loan shall, to the extent permitted by applicable law, be deemed to be amortized, prorated, allocated and spread throughout the full term of the Loan until payment in full so that the actual rate of interest on account of the Loan is uniform throughout the term thereof. The terms and provisions of this paragraph shall control and supersede every other provision of this Agreement and the Note.
Section VII.17 Further Assurances. From time to time, the Borrower shall perform any and all acts and execute and deliver to the Lender such additional documents as may be necessary or as requested by the Lender to carry out the purposes of this Agreement or any other Transaction Documents or to preserve and protect the Lender’s rights as contemplated herein or therein.
30 84216620_4 [SIGNATURE PAGE FOLLOWS]
31 84216620_4 IN WITNESS WHEREOF, the Parties, acting through their duly authorized representatives, have caused this Agreement to be signed in their respective names as of the date first above written.
______
By:
Name: Title:
______
By:
Name: Title:
32 84216620_4 SCHEDULE 1
FORM OF DISBURSEMENT REQUEST
[LETTERHEAD OF THE BORROWER]
[Date]
______
Facsimile: Attention:
Ladies and Gentlemen:
Request for Disbursement of the Loan
1. Please refer to the Loan Agreement (the “Loan Agreement”) dated as of May ____, 2010, between ______(the “Borrower”) and ______(the “Lender”).
2. Terms defined in the Loan Agreement shall have the same meanings herein.
3. The Borrower hereby requests a Disbursement, on [date], of the amount of [amount of drawdown], in accordance with the provisions of Section 2.3 of the Loan Agreement. Such Disbursement is comprised of [amount of Loan proceeds needed by Borrower] and [amount of Commitment Fee]. You are requested to withhold as payment under the Loan Agreement the foregoing Commitment Fee and to pay the remaining amount to the following account [account number] at [name of bank].
4. Attached hereto is a signed but undated receipt for the amount hereby requested to be disbursed, and we hereby authorize the Lender to date such receipt as of the date of actual disbursement by the Lender of the funds hereby requested to be disbursed.
5. The Borrower hereby certifies as follows:
(a) The representations and warranties confirmed or made in Article III of the Loan Agreement are true in all material respects on the date hereof with the same effect as though such representations and warranties had been made on today’s date;
(b) All of the conditions set forth in Article IV of the Loan Agreement have been satisfied in all material respects; and
33 84216620_4 (c) The Disbursement is to be used solely for the purposes described and in accordance with Section 2.1 of the Loan Agreement.
6. The above certifications are effective as of the date of this request for Disbursement and will continue to be effective as of the date of Disbursement. If any of these certifications is no longer valid as of or prior to the date of the Disbursement hereby requested, the Borrower will immediately notify the Lender and will repay the amount disbursed upon demand by the Lender if Disbursement is made prior to the receipt of such notice.
Yours faithfully,
______
By:
Name:
Title:
34 84216620_4 SCHEDULE 2
FORM OF EVIDENCE OF DISBURSEMENT
[LETTERHEAD OF THE BORROWER]
[Date]
______
Facsimile: Attention:
Ladies and Gentlemen:
Re: Disbursement Receipt
We, ______(the “Borrower”), hereby acknowledge receipt of the sum of [insert amount of disbursement] disbursed to us by ______(the “Lender”) under the Loan provided for in the Loan Agreement dated as of ______between the Borrower and the Lender.
Yours faithfully,
______
By:
Name:
Title
35 84216620_4 SCHEDULE 3
FORM OF PREPAYMENT NOTICE
______
Re: Prepayment Notice
Ladies and Gentlemen:
We, ______, (the “Borrower”), make reference to the Loan Agreement dated as of ______signed between the Borrower and ______(the “Loan Agreement”).
The Borrower hereby provides notice to you in accordance with Section 2.5(a) of the Loan Agreement that the Borrower shall repay the entire outstanding principal amount of $______on [date]. [Note: the date must be at least thirty (30) days after the date of this notice.]
This prepayment notice is irrevocable.
Yours faithfully,
______
By:
Name:
Title:
36 84216620_4 SCHEDULE 4
Related Party Transactions
37 84216620_4 EXHIBIT A
FORM OF PROMISSORY NOTE
PROMISSORY NOTE
$30,000,000.00 ______
FOR VALUE RECEIVED, ______, a limited liability company organized and existing under the laws of the State of ______(the “Maker”), by means of this Promissory Note (this “Note”) hereby unconditionally promises to pay to ______, a limited liability company existing under the laws of ______(the “Payee”), or order, the principal sum of THIRTY MILLION DOLLARS (US$30,000,000.00) or so much thereof as may be advanced by the Payee from time to time hereunder to or for the benefit of the Maker (the “Loan”), in lawful money of the United States of America and in immediately available funds, on the dates provided in the Loan Agreement. The Payee may make notations on the Disbursement and Prepayment Grid attached hereto reflecting the dates and amounts of Disbursements of the Loan and Prepayments made on the Loan.
The principal balance of this Note outstanding at any time shall bear interest from the date of disbursement until full payment of the principal hereof as set forth in the Loan Agreement dated as of ______between the Maker and the Payee (as modified and supplemented and in effect from time to time, the “Loan Agreement”).
The Maker shall make all payments to the Payee of principal and interest under this Note in the manner provided in and otherwise in accordance with the Loan Agreement. The outstanding principal balance of this Note, together with all accrued but unpaid interest, shall be due and payable in full on the Final Payment Date.
This Note is the “Note” referred to in the Loan Agreement with respect to the Loan made by the Payee thereunder. Capitalized terms used herein and not expressly defined in this Note shall have the respective meanings assigned to them in the Loan Agreement.
Without prejudice to the remedies available to the holder of this Note under this Note or otherwise, if the Maker fails to make any payment of principal or interest or any other payment due hereunder on its due date as specified in this Note or in the Loan Agreement (whether at stated maturity or upon prematuring), or if any other Event of Default shall occur and be continuing, any amounts owing under this Note shall bear interest at a rate equal to the lower of (a) LIBOR plus ______basis points per annum, calculated on a daily basis, and (b) the highest rate permitted by applicable law, from the date such payment became due until the date of actual payment (as well after as before judgment) and such interest shall be payable on demand.
The Maker shall have the right at any time, on not less than thirty (30) days’ prior written notice to the holder of this Note, to prepay on any Interest Payment Date all of the principal
38 84216620_4 amount then outstanding of this Note in accordance with the terms and subject to the provisions of the Loan Agreement.
If default is made in the punctual payment of principal, interest or any other amount under this Note, in accordance with the Loan Agreement, or if any other Event of Default has occurred, this Note shall, at the Payee’s option exercised at any time upon or after the occurrence of any aforesaid payment default or other Event of Default, become immediately due and payable, without notice, presentment, demand or protest of any kind, all of which are hereby expressly waived by the Maker, and the Payee shall, in addition, have the rights and remedies set forth in the Loan Agreement.
All payments of any kind due to the Payee from the Maker pursuant to this Note shall be made in the full face amount thereof, without setoff, counterclaim, or other defense. All such payments will be free and clear of, and without deduction or withholding for, any present or future taxes. The Maker shall pay all and any costs (administrative or otherwise) imposed by banks, clearing houses, or any other financial institution, in connection with making any payments hereunder, except for any costs imposed by the Lender’s banking institutions. All such payments from the Maker to the Payee shall be applied to such amounts owed hereunder, and in such order, as the Payee shall determine; without limiting the foregoing in any way, the Maker acknowledges and agrees that the Payee shall be entitled to apply the aforesaid payments first to accrued interest and then to the reduction of the outstanding principal balance of this Note in inverse order of maturity.
The Maker shall pay all costs of collection, including, without limitation, all documented legal expenses and attorneys’ fees, paid or incurred by the Payee in collecting and enforcing this Note.
Except as provided in the Loan Agreement, the Maker and every endorser of this Note, or the obligations represented hereby, expressly waive presentment, protest, demand, notice of dishonor or default, and notice of any kind with respect to this Note and the Loan Agreement or the performance of the obligations under this Note and/or the Loan Agreement. No renewal or extension of this Note or the Loan Agreement, no release or surrender of any security for this Note or the Loan Agreement, no release of any Person primarily or secondarily liable on this Note or the Loan Agreement, including the Maker and any endorser, no delay in the enforcement of payment of this Note or the Loan Agreement, and no delay or omission in exercising any right or power under this Note or the Loan Agreement shall affect the liability of the Maker or any endorser or guarantor of this Note.
No delay or omission by the Payee in exercising any power or right hereunder shall impair such right or power or be construed to be a waiver of any default, nor shall any single or partial exercise of any power or right hereunder preclude the full exercise thereof or the exercise of any other power or right. The provisions of this Note may be waived or amended only in a writing signed by the Maker and the Payee.
Every legal holder of this Note shall have and may exercise all of the rights and powers given to the Payee in this Note.
39 84216620_4 THIS NOTE, AND ANY RIGHTS OF THE PAYEE ARISING OUT OF OR RELATING TO THIS NOTE, MAY, AT THE OPTION OF THE PAYEE, BE ENFORCED BY THE PAYEE IN THE COURTS OF THE UNITED STATES OF AMERICA LOCATED IN THE SOUTHERN DISTRICT OF THE STATE OF NEW YORK OR IN ANY OTHER COURTS HAVING JURISDICTION. FOR THE BENEFIT OF THE PAYEE, THE MAKER HEREBY IRREVOCABLY AGREES THAT ANY LEGAL ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND HEREBY CONSENTS THAT PERSONAL SERVICE OF SUMMONS OR OTHER LEGAL PROCESS MAY BE MADE AS SET FORTH IN SECTION 7.2 OF THE LOAN AGREEMENT, WHICH SERVICE THE MAKER AGREES SHALL BE SUFFICIENT AND VALID. THE MAKER HEREBY WAIVES ANY AND ALL RIGHTS TO DEMAND A TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE OR THE TRANSACTIONS CONTEMPLATED BY THIS NOTE.
This Note shall be governed by, and construed in accordance with, the laws of the State of New York applicable to contracts made and to be performed in such State, without giving effect to the conflicts of laws principles thereof other than Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York.
IN WITNESS WHEREOF, an authorized representative of the Maker has executed this Note as of the date first written above.
______
By:
Name:
Title:
40 84216620_4 DISBURSEMENT AND PREPAYMENT GRID PROMISSORY NOTE OF ______
Amount of Amount of Resulting Outstanding Date Disbursement Prepayment Principal Amount Payee’s Initials
1 84216620_4