Credit Agreement - Royal Bank of Canada, ABN AMRO Bank NV, Credit Lyonnais, Commerzbank AG, and Countrywide Home Loans Inc.
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (the "Agreement") is made and dated as
of the 12th day of April, 2000, by and among the lenders signatory hereto
(collectively, the "Lenders"); ROYAL BANK OF CANADA ("RBC"), as lead
administrative agent for the Lenders (in such capacity, the "Lead Administrative
Agent"); ABN AMRO BANK, N.V. ("ABN"), as co-administrative agent (in such
capacity, the "Co-Administrative Agent"); CREDIT LYONNAIS NEW YORK BRANCH
("CL"), as syndication agent (in such capacity, the "Syndication Agent");
COMMERZBANK AG, NEW YORK BRANCH ("CA"), as documentation agent (in such
capacity, the "Documentation Agent"); RBC, as arranger (in such capacity, the
"Arranger"), ABN, CL and CA, as co-arrangers (in such capacity, the
"Co-Arrangers"); the Lenders acting as co-agents, as indicated on the signature
pages hereof (in such capacity, the "Co-Agents"); and COUNTRYWIDE HOME LOANS,
INC., a New York corporation (the "Company").
RECITALS
A. Pursuant to that certain Revolving Credit Agreement dated
as of April 15, 1998, by and among the Company, the Lenders party thereto, the
Lead Administrative Agent and the Co-Administrative Agent, the Syndication
Agent, the Documentation Agent, the Arranger, the Co-Arrangers and the Co-Agents
named therein (as amended to date, the "Existing Credit Agreement"), the Lenders
party thereto agreed to extend credit to the Company in the form of a short
term, unsecured revolving credit facility on the terms and subject to the
conditions set forth therein.
B. The Company has requested that the Existing Credit
Agreement be further amended to, among other things, provide a term facility
pursuant to which loans outstanding under the Existing Credit Agreement may (or,
following the Effective Date (as that term and capitalized terms used herein are
defined in, or the location of such definitions referenced in, the Glossary
attached hereto as Annex I), hereunder) under certain circumstances be converted
into a term loan.
C. The Lenders and the other parties hereto have agreed to so
amend the Existing Credit Agreement and, for convenience of reference, to
restate the Existing Credit Agreement in its entirety as set forth herein and to
replace and supersede the Existing Credit Agreement and the other "Credit
Documents" (as that term is used and defined in the Existing Credit Agreement)
pursuant to this Agreement and the documents, instruments, and agreements
referred to herein.
NOW, THEREFORE, in consideration of the above Recitals and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:
AGREEMENT
1. Credit Facilities.
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1(a) Primary Facility. On the terms and subject to the conditions set forth
herein, each of the Lenders
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severally agrees that it shall, from time to time to but not including the
Revolving Facility Maturity Date (as that term and capitalized terms used herein
are defined in, or the location of the definitions of such terms referenced in,
the Glossary attached hereto as Annex I), advance its respective Primary
Percentage Share of loans (the "Primary Loans" or a "Primary Loan") to the
Company in amounts not to exceed in the aggregate at any date outstanding the
Aggregate Credit Limit minus the aggregate dollar amount of Swing Loans
outstanding on such date (including Swing Loans to be funded on such date but
excluding Swing Loans to be repaid on such date).
1(b) Swing Loan Facility. On the terms and subject
to the conditions set forth herein, each of the Swing
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Line Lenders severally agrees that it shall, from time to time to but not
including the Revolving Facility Maturity Date, advance its respective Swing
Line Percentage Share of loans (the "Swing Loans" or a "Swing Loan") to the
Company in amounts such that the aggregate amount of Swing Loans outstanding
does not exceed at any date the lesser of:
(1) The Aggregate Swing Line Commitment;
and
(2) The Aggregate Credit Limit minus the
aggregate dollar amount of Primary Loans outstanding on such date (including
Primary Loans to be funded on such date and excluding Primary Loans to be
repaid on such date).
At the request of any Swing Line Lender, made through the Lead Administrative
Agent at any time and from time to time, including, without limitation,
following the occurrence of an Event of Default, each Lender (including each of
the Swing Line Lenders) absolutely and unconditionally agrees to refund Swing
Loans held by the Swing Line Lenders by advancing its Primary Percentage Share
thereof to the Lead Administrative Agent for disbursement to the Swing Line
Lenders pro rata, in accordance with their respective Swing Line Percentage
Shares. Such fundings shall be made no later than 12:00 noon (Los Angeles time)
on the date request therefor is made if such request is made on or before 11:00
a.m. (Los Angeles time) on such date, and no later than 12:00 noon (Los Angeles
time) on the next succeeding Business Day if request therefor is made after
11:00 a.m. (Los Angeles time). Advances made by the Lenders hereunder for the
purpose of refunding Swing Loans shall, for all purposes of the Credit
Documents: (i) constitute Primary Loans to the extent of such Lender's Primary
Percentage Share thereof, and (ii) be advanced as Alternate Base Rate Loans. In
the event, for whatever reason, the Lenders are not able to advance their
respective Primary Percentage Shares for the purpose of refunding Swing Loans as
required hereunder, then each of the Lenders (including each of the Swing Line
Lenders) absolutely and unconditionally agrees to purchase and take from the
Swing Line Lenders on demand an undivided participation interest in Swing Loans
outstanding in an amount equal to their respective Primary Percentage Shares of
such Swing Loans. Notwithstanding anything contained herein, in no event shall
any Lender be required to advance its Primary Percentage Share of any Swing Loan
or to purchase any undivided participation interest in any Swing Loan: a. unless
such Swing Loan was initially made in accordance with the requirements of this
Agreement (as such requirements may be amended or waived from time to time as
permitted hereunder) or b. if upon such advance or purchase the aggregate dollar
amount of Primary Loans and Swing Loans held by such Lender would exceed such
Lender's Maximum Commitment.
1(c) Term Loan Facility. In the event the Lead
Administrative Agent shall have notified the Company that
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the Majority Lenders shall have elected not to extend the then current Revolving
Facility Maturity Date pursuant to Paragraph 5(m) below, then the Company may,
no later than ten (10) days prior to the then current Revolving Maturity Date,
notify the Lenders in writing, through the Lead Administrative Agent, that it
desires to convert the principal balance of Primary Loans outstanding on the
then current Revolving Facility Maturity Date to a one year, non-amortizing term
loan (the "Term Loan"). Subject to the conditions precedent set forth in
Paragraph 7(c) below, on the then current Revolving Facility Maturity Date: (1)
all Swing Loans outstanding shall be refunded by the Lenders in accordance with
their respective Primary Percentage Shares, and (2) thereafter, the principal
balance of Primary Loans outstanding on such date shall be automatically
converted into the Term Loan, which Term Loan shall be held by each of the
Lenders in accordance with their Primary Percentage Shares. The date of such
conversion shall be referred to herein as the "Conversion Date". Following the
Conversion Date no further borrowings shall be permitted under this Agreement,
it being agreed and understood by the Company that any right of the Company to
draw down undrawn portions of the Aggregate Credit Limit shall have terminated
on the Conversion Date.
2. Requests for Loans; Funding.
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2(a) Requests for Loans. Subject to the advance
notice required with respect to Eurodollar Loans pursuant
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to Paragraph 4(a) below, on any Business Day that the Company desires to borrow
Primary Loans or Swing Loans, it shall deliver a Loan Request, Interest Rate
Election and Payoff Notice to the Lead Administrative Agent no later than: (1)
in the case of Primary Loans, 10:00 a.m. (Los Angeles time) on such date, and
(2) in the case of Swing Loans, 11:00 a.m. (Los Angeles time) on such date;
provided, however, that in the event the Lead Administrative Agent receives a
request for a Swing Loan after 11:00 a.m. (Los Angeles time) on a Business Day,
the Lead Administrative Agent shall work with the Swing Line Lenders on a best
efforts basis with a view toward funding the requested Swing Loans no later than
1:00 p.m. (Los Angeles time) on such date, the Company expressly acknowledging
and agreeing that there is no assurance that any such funding can be provided.
Only one Loan Request, Interest Rate Election and Payoff Notice requesting
Primary Loans and only one Loan Request, Interest Rate Election and Payoff
Notice requesting Swing Loans shall be submitted to the Lead Administrative
Agent on any date. Any request for Primary Loans shall be in such amount that
the aggregate dollar amount of Primary Loans which the Lenders are required to
actually newly fund with respect thereto is not less than $5,000,000.00, and any
request for Swing Loans shall be in an amount not less than $1,000,000.00. On
each Business Day on which a Loan Request, Interest Rate Election and Payoff
Notice is delivered to the Lead Administrative Agent, the Lead Administrative
Agent shall notify the applicable Lenders (which notification may be telephonic
and, if telephonic, shall be promptly confirmed in writing) no later than 11:00
a.m. (Los Angeles time) or in the case of a Swing Loan, 11:30 a.m. (Los Angeles
time)) of the aggregate amount of Primary Loans and/or Swing Loans which will be
funded on such date.
2(b) Funding of Primary Loans and Swing Loans.
Primary Loans and Swing Loans requested pursuant to any
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Loan Request, Interest Rate Election and Payoff Notice shall be funded as
follows:
(1) Each Lender shall make its Primary Percentage Share of Primary Loans
available by wiring the amount thereof in immediately available same day
(including Federal) funds, to the Funding Account no later than 12:30 p.m. (Los
Angeles time) on the proposed funding date; and
(2) Each Swing Line Lender shall make its Swing Line Percentage Share of each
Swing Loan available by wiring the amount thereof in immediately available same
day (including Federal) funds to the Funding Account no later than 2:00 p.m.
(Los Angeles time) on the proposed funding date.
2(c) Funding Method. Each Lender shall be entitled to fund and maintain all or
any portion of its Primary --------------
Percentage Share of Primary Loans and refund and maintain its Primary Percentage
Share of Swing Loans, each Swing Lender shall be entitled to fund and maintain
all or any portion of its Swing Line Percentage Share of Swing Loans and,
following the Conversion Date, each Lender shall be entitled to fund and
maintain its Primary Percentage Share of the Term Loan in any manner it may
determine in its sole discretion, including, without limitation, in the Grand
Cayman inter-bank market, the eurocurrency inter-bank market and within the
United States, but all calculations and transactions hereunder shall be
conducted as though all Lenders actually fund and maintain Eurodollar Loans
funded by them hereunder through the purchase of offshore dollar deposits in
such amounts with maturities corresponding to the applicable Interest Periods.
3. Payment of Principal; Prepayments.
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3(a) Required Principal Payments. Subject to the provisions of Paragraph 3(b)
below, the Company shall pay
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to the Lead Administrative Agent for the account of the Lenders the unpaid
principal balance of each Primary Loan which is a Eurodollar Loan on the last
day of the applicable Eurodollar Interest Period and the unpaid principal
balance of each Primary Loan which is an Alternate Base Rate Loan and each Swing
Loan on the Revolving Facility Maturity Date. Following the Conversion Date, the
Company shall pay to the Lead Administrative Agent for the account of the
Lenders the unpaid principal balance of portions of the Term Loan on the Final
Maturity Date.
3(b) Prepayments. The Company:
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(1) May voluntarily prepay Loans in whole or in part at any time; provided,
however, that any prepayment shall be accompanied by accrued but unpaid interest
on the Loan or portion thereof being prepaid.
(2) Shall pay in connection with any prepayment hereunder any amount payable on
account thereof pursuant to Paragraph 4(e) below concurrently with such
prepayment.
4. Calculation and Payment of Interest; Related Provisions.
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4(a) Interest on Primary Loans and the Term Loan.
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(1) The Company shall pay interest to each Lender on such Lender's Primary
Percentage Share of Primary Loans outstanding and, following the Conversion
Date, on such Lender's Primary Percentage Share of the Term Loan, calculated, at
the election of the Company made from time to time as permitted herein and set
forth on a duly executed Loan Request, Interest Rate Election and Payoff Notice,
at either: (i) the Alternate Base Rate and/or (ii) the Applicable Eurodollar
Rate. Primary Loans and portions of the Term Loan bearing interest at the
Alternate Base Rate shall be referred to herein as "Alternate Base Rate Loans"
and Primary Loans and portions of the Term Loan bearing interest at the
Applicable Eurodollar Rate shall be referred to herein as "Eurodollar Loans".
(2) The Company may elect from time to time to have Primary Loans funded as
Alternate Base Rate Loans by giving the Lead Administrative Agent irrevocable
notice of such election as set forth on a duly executed Loan Request, Interest
Rate Election and Payoff Notice delivered on the proposed funding date. The
Company may elect from time to time to have Primary Loans funded as Eurodollar
Loans by giving the Lead Administrative Agent at least three Eurodollar Business
Days' prior irrevocable notice of such election by delivery of a duly executed
Loan Request, Interest Rate Election and Payoff Notice.
(3) The Company may elect from time to time to convert Eurodollar Loans,
including, following the Conversion Date, portions of the Term Loan being
maintained as Eurodollar Loans, to Alternate Base Rate Loans by giving the Lead
Administrative Agent irrevocable notice of such election as set forth on a duly
executed Loan Request, Interest Rate Election and Payoff Notice delivered on the
proposed conversion date; provided, however, that any conversion of Eurodollar
Loans to Alternate Base Rate may only be made on the last day of the applicable
Eurodollar Interest Period. The Company may elect from time to time to convert
Alternate Base Rate Loans, including, following the Conversion Date, portions of
the Term Loan being maintained as Alternate Base Rate Loans, to Eurodollar Loans
by giving the Lead Administrative Agent at least three Eurodollar Business Days'
prior irrevocable notice of such election by delivery of a duly executed Loan
Request, Interest Rate Election and Payoff Notice.
(4) Upon receipt of any Loan Request, Interest Rate Election and Payoff Notice,
the Lead Administrative Agent shall promptly notify each of the Lenders thereof.
No Primary Loan shall be funded as a Eurodollar Loan and no outstanding
Alternate Base Rate Loan shall be converted into a Eurodollar Loan if an Event
of Default or Potential Default has occurred and is continuing on the day
occurring two Business Days prior to the date of the funding or conversion
requested by the Company or on the proposed funding or conversion date.
(5) Any Eurodollar Loan may be continued as such upon the expiration of the
Interest Period applicable thereto by giving the Lead Administrative Agent
(which shall notify the Lenders) at least three Eurodollar Business Days' prior
irrevocable notice of such election as set forth on a duly executed Loan
Request, Interest Rate Election and Payoff Notice; provided, however, that no
Eurodollar Loan may be continued as such when any Event of Default or Potential
Default has occurred and is continuing, but shall be automatically converted to
an Alternate Base Rate Loan on the last day of the then current Interest Period
applicable thereto. The Lead Administrative Agent shall notify the Lenders and
the Company promptly that such automatic conversion will occur. If the Company
shall fail to give notice as provided above, the Company shall be deemed to have
elected to convert the affected Eurodollar Loan to an Alternate Base Rate Loan
on the last day of the Interest Period applicable thereto.
(6) The Lead Administrative Agent shall give prompt written notice (or notice by
telephone immediately confirmed in writing) to the Company and the Lenders of
the applicable interest rate determined by the Lead Administrative Agent.
(7) Under no circumstances shall the Lenders be required to make or maintain
Eurodollar Loans under this Agreement with more than an aggregate number of
eight (8) different Eurodollar Interest Periods.
4(b) Interest on Swing Loans. The Company shall pay interest to each Swing Line
Lender on such Swing Line
-----------------------
Lender's Swing Line Percentage Share of Swing Loans outstanding from the date
advanced to but not including the date of payment thereof at the Applicable Fed
Funds Rate.
4(c) Payment of Interest. The Company shall pay interest, in each case as more
specifically provided in
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Paragraph 5(d) below:
(1) On Alternate Base Rate Loans and Swing Loans, monthly, in arrears, on the
fifth day of each month for the period from and including the first day of the
immediately preceding month to and including the last day of such month; and
(2) On Eurodollar Loans on the last day of the applicable Eurodollar Interest
Period relating thereto.
4(d) Inability to Determine Rate. In the event that the Lead Administrative
Agent shall have determined
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(which determination shall be conclusive and binding upon the Company) that by
reason of circumstances affecting the interbank eurodollar market adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate for any given
Eurodollar Interest Period, the Lead Administrative Agent shall forthwith give
notice (which may be telephonic and promptly confirmed in writing or by
facsimile transmission) of such determination to each Lender and to the Company
at least two Eurodollar Business Days prior to, as the case may be, the
conversion date of an Alternate Base Rate Loan to a Eurodollar Loan, the
continuation of a Eurodollar Loan as such or the proposed funding of a Primary
Loan as a Eurodollar Loan. If such notice is given: (1) any Alternate Base Rate
Loan that was to have been converted to a Eurodollar Loan and any Primary Loan
that was to have been funded as a Eurodollar Loan shall, subject to the
provisions hereof, be continued or funded as an Alternate Base Rate Loan, and
(2) any outstanding Eurodollar Loan shall be converted, on the last day of the
then current Interest Period with respect thereto, to an Alternate Base Rate
Loan. Until such notice has been withdrawn by the Lead Administrative Agent, the
Company shall not have the right to convert an Alternate Base Rate Loan to a
Eurodollar Loan, to continue a Eurodollar Loan as such or to fund a Primary Loan
as a Eurodollar Loan.
4(e) Funding Indemnification. In addition to all other payment obligations
hereunder, in the event:
-----------------------
(1) any Eurodollar Loan is prepaid prior to the last day of the applicable
Eurodollar Interest Period, whether following acceleration upon the occurrence
of an Event of Default or otherwise, including, without limitation, pursuant to
Paragraphs 14(a), 14(b) and 14(c) below, or (2) the Company shall fail to make a
conversion into or a borrowing as a Eurodollar Loan after the Company has given
notice thereof as provided in Paragraph 4(a)(2) above, or (3) the Company shall
fail to continue any Eurodollar Loan which it has elected to have continued as a
Eurodollar Loan, or (4) the Company shall fail to make any payment of principal
or interest on any Loan when due, then the Company shall immediately pay to each
of the affected Lenders, through the Lead Administrative Agent, an additional
amount compensating such Lender for all losses, costs and expenses incurred by
such Lender in connection therewith, including, without limitation, such as may
arise out of the re-employment of funds obtained by such Lender or from fees
payable to terminate the deposits from which such funds were obtained, such
losses, costs and expenses and the method of calculation thereof being set forth
in reasonable detail in a statement delivered to the Company by such Lender,
such statement to be conclusive in the absence of manifest error. Under no
circumstances shall any Lender have any obligation to remit monies to the
Company upon prepayment of any Eurodollar Loan, even under circumstances which
do not result in the necessity for the payment by the Company of any amount
hereunder. The provisions hereof shall survive termination of this Agreement and
payment of the outstanding Loans and all other Obligations.
4(f) Illegality; Impracticality. Notwithstanding any other provisions herein, if
any law, regulation,
--------------------------
treaty or directive or any change therein or in the interpretation or
application thereof shall or may in the opinion of any Lender make it unlawful
or impractical for such Lender to make or maintain Eurodollar Loans: (1) the
commitment of such Lender hereunder to make, continue or convert into Eurodollar
Loans shall forthwith be cancelled and (2) such Lender's Primary Percentage
Share of Loans outstanding as Eurodollar Loans, if any, shall be converted
automatically to Alternate Base Rate Loans at the end of their respective
Eurodollar Interest Periods or within such earlier period as required by law. In
the event of a conversion of any Eurodollar Loan prior to the end of its
applicable Eurodollar Interest Period the Company hereby agrees promptly to pay
each Lender, upon its written demand, the amounts required pursuant to Paragraph
4(e) above, it being agreed and understood that such conversion shall constitute
a prepayment for all purposes hereof. The provisions hereof shall survive the
termination of this Agreement and payment of the outstanding Loans and all other
Obligations.
4(g) Requirements of Law; Increased Costs. In the event that a change subsequent
to the date hereof in any ------------------------------------
applicable law, regulation, treaty or directive or in the governmental or
judicial interpretation or application thereof, or compliance by any Lender with
any request or directive (whether or not having the force of law) issued
subsequent to the date hereof by any central bank or other governmental
authority, agency or instrumentality:
(1) Does or shall subject any Lender to any tax of any kind whatsoever with
respect to this Agreement or any Loans purchased or made hereunder, or changes
the basis of taxation of payments to such Lender of principal, fees, interest or
any other amount payable hereunder (except for changes in the rate of tax on
the overall net income of such Lender);
(2) Does or shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by, or
deposits or other liabilities in or for the account of, advances or loans by, or
other credit extended by, or any other acquisition of funds by, any office of
such Lender which are not otherwise included in the determination of the
Alternate Base Rate or the Applicable Eurodollar Rate; or
(3) Does or shall impose on such Lender any other condition; and the result of
any of the foregoing is to increase the cost to such Lender of purchasing,
making, agreeing to make, renewing or maintaining or issuing any Loan or to
reduce any amount receivable in respect thereof then, in any such case, the
Company shall promptly pay to such Lender, upon its written demand, any
additional amounts necessary to compensate such Lender for such additional cost
or reduced amounts receivable as determined by such Lender with respect to this
Agreement or such credit extensions. If a Lender becomes entitled to claim any
additional amounts pursuant to this Paragraph 4(g), it shall promptly notify the
Company of the event by reason of which it has become so entitled. A certificate
as to any additional amounts payable pursuant to the foregoing sentence
submitted by a Lender to the Company shall be conclusive in the absence of
manifest error. The obligations of the Company under this Paragraph 4(g) shall
survive the termination of this Agreement and the payment of all other
Obligations.
4(h) Taxes.
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(1) All payments made by the Company, the Lead Administrative Agent and the
Lenders on account of the Obligations shall be made free and clear of, and
without deduction or withholding for or on account of, any present or future
income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions
or withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any Governmental Authority, excluding, in the case of the Lenders,
net income taxes and franchise taxes (imposed in lieu of net income taxes),
imposed on the Lenders, as the case may be, as a result of a present or former
connection between the jurisdiction of the government or taxing authority
imposing such tax, or any political subdivision or taxing authority thereof or
therein, and such Lender (other than a connection arising solely from such
Lender having executed, delivered or performed its obligations or received a
payment under, or enforced, the Credit Documents) (all such non-excluded taxes,
levies, imposts, duties, charges, fees, deductions and withholdings being
hereinafter called "Taxes"). If any Taxes are required to be withheld from any
amounts payable to any Lender under the Credit Documents, the amounts so payable
by the Company to the Lead Administrative Agent for the benefit of such Lender
shall be increased to the extent necessary to yield to such Lender (after
payment of all Taxes) interest or any such other amounts payable thereunder at
the rates or in the amounts specified in the Credit Documents. Whenever any
Taxes are payable by the Company or on behalf of the Company, as promptly as
possible thereafter the Company shall send to the Lead Administrative Agent for
its own account or for the account of such Lender, as the case may be, a
certified copy of an original official receipt received by the Company showing
payment thereof. If the Company fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the Lead Administrative Agent
the required receipts or other required documentary evidence, the Company shall
indemnify the Lead Administrative Agent and such Lender for any incremental
taxes, interest or penalties that may become payable by the Lead Administrative
Agent and the Lenders as a result of any such failure. The agreements in this
subsection shall survive the termination of this Agreement and the payment of
all other Obligations. Each Lender by executing this Agreement represents and
warrants to the Company and the Lead Administrative Agent that at the date of
this Agreement no Taxes are imposed upon such Lender which would result in
increased liability of the Company to such Lender pursuant to this Paragraph
4(h)(1).
(2) Each Lender that is not incorporated under the laws of the United States of
America or a state thereof (each a "Non-U.S. Lender") agrees that it will, on or
before the Effective Date or the effective date of any Additional Lender
Agreement pursuant to which it becomes a Lender and on the request of the Lead
Administrative Agent or the Company, (i) deliver to each of the Company and the
Lead Administrative Agent two duly completed copies of United States Internal
Revenue Service Form W-8ECI or W-8BEN or any successor form, certifying in
either case that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes, and (ii) deliver to each of the Company and the Lead Administrative Agent
a United States Internal Revenue Service Form W-8 or W-9, as the case may be,
and certify that it is entitled to an exemption from United States backup
withholding tax. Each Non-U.S. Lender further undertakes to deliver to each of
the Company and the Lead Administrative Agent (x) renewals or additional copies
of such form (or any successor form) on or before the date that such form
expires or becomes obsolete, and (y) after the occurrence of any event requiring
a change in the most recent forms so delivered by it, such additional forms or
amendments thereto as may be reasonably requested by the Company or the Lead
Administrative Agent. All forms or amendments described in the preceding
sentence shall certify that such Lender is entitled to receive payments under
this Agreement without deduction or withholding of any United States federal
income taxes, unless an event (including without limitation any change in
treaty, law or regulation) has occurred after the relevant date and prior to the
date on which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent such Lender from duly completing
and delivering any such form or amendment with respect to it and such Lender
advises the Company and the Lead Administrative Agent that it is not capable of
receiving payments without any deduction or withholding of United States federal
income tax.
(3) For any period during which a Non-U.S. Lender has failed to provide the
Company with an appropriate form pursuant to subparagraph (2) above (unless such
failure is due to a change after the relevant date in treaty, law or regulation,
or any change in the interpretation or administration thereof by any
governmental authority, occurring subsequent to the date on which a form
originally was required to be provided), such Non-U.S. Lender shall not be
entitled to indemnification under this Paragraph 4(h) with respect to Taxes;
provided that, should a Non-U.S. Lender which is otherwise exempt from or
subject to a reduced rate of withholding tax become subject to Taxes because of
its failure to deliver a form required under subparagraph (2) above, the Company
shall take (at the expense of the Non-U.S. Lender) such steps as such Non-U.S.
Lender shall reasonably request to assist such Non-U.S. Lender to recover such
Taxes.
(4) Any Lender that is entitled to an exemption from or reduction of withholding
tax with respect to payments under this Agreement or any Note pursuant to the
law of any relevant jurisdiction or any treaty shall deliver to the Company
(with a copy to the Lead Administrative Agent), at the time or times prescribed
by applicable law, such properly completed and executed documentation prescribed
by applicable law as will permit such payments to be made without withholding or
at a reduced rate.
(5) If the U.S. Internal Revenue Service or any other governmental authority of
the United States or any other country or any political subdivision thereof
asserts a claim that the Lead Administrative Agent did not properly withhold tax
from amounts paid to or for the account of any Lender (because the appropriate
form was not delivered or properly completed, because such Lender failed to
notify the Lead Administrative Agent of a change in circumstances which rendered
its exemption from withholding ineffective, or for any other reason), such
Lender shall indemnify the Lead Administrative Agent fully for all amounts paid,
directly or indirectly, by the Lead Administrative Agent as tax, withholding
therefor, or otherwise, including penalties and interest, and including taxes
imposed by any jurisdiction on amounts payable to the Lead Administrative Agent
under this subparagraph, together with all costs and expenses related thereto
(including attorneys fees and time charges of attorneys for the Lead
Administrative Agent, which attorneys may be employees of the Lead
Administrative Agent). The obligations of the Lenders under this Paragraph 4(h)
shall survive the termination of this Agreement and the payment of all other
Obligations.
4(i) Buy-Down Provisions. Notwithstanding anything contained in this Agreement,
the Company and any ------------------- individual Lender (as used in this
Paragraph 4(i), a "Buy-Down Lender") may notify the Lead Administrative Agent in
writing that the Company and such Buy-Down Lender have entered into a Buy-Down
Agreement with respect to all or a portion of the Loans from time to time
outstanding held by such Buy-Down Lender (the Loans held by such Buy-Down Lender
which are subject to a Buy-Down Agreement being referred to herein as "Buy-Down
Rate Loans"), and that, pursuant to said Buy-Down Agreement, the interest rate
otherwise applicable to the Buy-Down Rate Loans during any interest calculation
period shall be reduced to the Buy-Down Rate and the interest otherwise payable
by the Company to such Buy-Down Lender during such interest calculation period
shall be reduced accordingly. Interest payable to such Buy-Down Lender with
respect to Buy-Down Rate Loans shall be billed as provided in Paragraph 5(d)
below. In no event shall the Lead Administrative Agent have any obligation or
duty to verify the amount of any Buy-Down Deposits supporting the pricing of
Buy-Down Rate Loans held by any Buy-Down Lender or the amount of any interest
billing with respect thereto. Any deficiency fees payable to such Buy-Down
Lender by the Company under the applicable Buy-Down Agreement shall be billed by
such Buy-Down Lender to the Company directly. Any Buy-Down Lender may elect not
to make demand for the payment of deficiency fees accruing in respect of
Buy-Down Deposits from time to time and it is expressly agreed and understood
that: (1) any such deficiency fee shall not, by reason of such failure of such
Buy-Down Lender or otherwise, be deemed to have been waived by such Buy-Down
Lender (except as such waiver is expressly acknowledged in writing by such
Buy-Down Lender from time to time), and (2) all deficiency fees accrued and
unpaid hereunder and not so expressly waived, whether or not previously declared
due and owing by any such Buy-Down Lender, shall automatically be due and
payable in full upon the Revolving Facility Maturity Date or, following the
Conversion Date, the Final Maturity Date.
4(j) Obligation of Lenders to Mitigate; Replacement of Lenders. Each Lender
agrees that: ---------------------------------------------------------
(1) As promptly as practicable after the officer of such Lender responsible for
administering the Loans of such Lender becomes aware of any event or condition
that would entitle such Lender to receive payments under Paragraph 4(g) above or
to cease making Eurodollar Loans pursuant to Paragraph 4(f) above, such Lender
will use reasonable efforts (i) to make, issue, fund or maintain the affected
Loans of such Lender through another lending office of such Lender or (ii) take
such other measures as such Lender may deem reasonable, if as a result thereof
the additional amounts which would otherwise be required to be paid to such
Lender pursuant to Paragraph 4(g) above would be materially reduced or
eliminated or the conditions rendering such Lender incapable of making
Eurodollar Loans under Paragraph 4(f) above no longer would be applicable, and
if, as determined by such Lender in its sole discretion, the making, issuing,
funding or maintaining of such Loans through such other lending office or in
accordance with such other measures, as the case may be, would not otherwise
materially adversely affect such Loans or the interests of such Lender.
(2) If the Company receives a notice pursuant to Paragraph 4(g) above or a
notice pursuant to Paragraph 4(f) above stating that a Lender is unable to
extend Eurodollar Loans (for reasons not generally applicable to the Majority
Lenders), so long as (i) no Potential Default or Event of Default shall have
occurred and be continuing, (ii) the Company has obtained a commitment from
another Lender or another financial institution reasonably acceptable to the
Lead Administrative Agent to purchase at par such Lender's Loans, Maximum
Commitment and accrued interest and fees and to assume all obligations of the
Lender to be replaced under the Credit Documents, and (iii) such Lender to be
replaced is unwilling to withdraw the notice delivered to the Company, upon
thirty (30) days' prior written notice to such Lender and the Lead
Administrative Agent and payment of any amounts due under Paragraph 4(g) above,
the Company may require, at the Company's expense and subject to Paragraph 4(e)
above, the Lender giving such notice to assign, without recourse, all of its
Loans, Maximum Commitment and accrued interest and fees to such other Lender or
financial institution pursuant to the provisions of Paragraph 14 below.
Following such assignment, the assigning Lender shall retain the benefits of
Paragraphs 4(g) and 4(h) above and Paragraph 9(g) below as the same relate to
the period prior to the effective date of such assignment.
5. Miscellaneous Lending Provisions.
--------------------------------
5(a) Use of Proceeds. The proceeds of Loans shall be utilized by the Company for
general corporate
---------------
purposes, including, without limitation, repayment of Indebtedness of the
Company to the Parent permitted to be repaid by the Company to the Parent
pursuant to the terms of the Credit Documents, and including CPNs.
5(b) Assumption of Funding/Purchase. The Lead Administrative Agent may (but
shall not be obligated to)
------------------------------
assume that each Lender has advanced its Primary Percentage Share of Primary
Loans and that each Swing Line Lender has advanced its Swing Line Percentage
Share of Swing Loans required to be funded by such Lender hereunder on the
funding date therefor and may, in reliance upon such assumption, make available
to the Company on such date a corresponding amount. If and to the extent any
Lender shall not have so made such amounts available, such Lender and the
Company jointly and severally agree to repay to the Lead Administrative Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to the Company until
the date such amount is repaid to the Lead Administrative Agent, at, in the case
of the Company, the interest rate applicable at the time to the subject Loan
and, in the case of the Lenders, the Federal Funds Effective Rate. If such
Lender shall repay to the Lead Administrative Agent such corresponding amount,
such amount so repaid shall constitute such Lender's Primary Percentage Share or
Swing Line Percentage Share, as applicable, of the subject Loan, as applicable
for all purposes of the Credit Documents as of the date such Loan was made.
Nothing contained herein shall affect the liability of any Lender for its
failure to make its Primary Percentage Share of Primary Loans or its Swing Line
Percentage Share of Swing Loans available to the Company as required pursuant to
this Agreement and the other Credit Documents.
5(c) Evidence of Indebtedness. The obligation of the Company to repay Loans
shall be evidenced by
------------------------
notations on the books and records of the Lead Administrative Agent and the
Lenders. Such accounts shall be conclusive absent manifest error. Any failure to
record the advance of any Loan, the interest rate applicable thereto or any
other information regarding the Obligations, or any error in doing so, shall not
limit or otherwise affect the obligation of the Company with respect to any of
the Obligations. Upon the request of any Lender, the Company shall promptly
execute a promissory note or promissory notes in favor of such Lender evidencing
the Obligations held by such Lender hereunder.
5(d) Interest and Fee Billing and Payment. The Lead Administrative Agent shall:
------------------------------------
(1) On or before the first Business Day of each month notify the Company (which
notification may be telephonic) of the estimated amount of interest payable with
respect to Alternate Base Rate Loans and Swing Loans as of the fifth day of the
current month for the period from and including the first day of the immediately
preceding month to and including the last day of such month, with the actual
amount confirmed by notification by the Lead Administrative Agent to the Company
(which notification may be telephonic and which, if telephonic, shall be
promptly confirmed in writing) given no later than 9:00 a.m. (Los Angeles time)
on the due date of payment thereof;
(2) On the last day of the Interest Period for each Eurodollar Loan notify the
Company (which notification may be telephonic and which, if telephonic, shall be
promptly confirmed in writing) of the amount of interest payable on such date on
account thereof;
(3) On or before the first Business Day of the first month of each calendar
quarter notify the Company (which notification may be telephonic) of the amount
of facility fees payable pursuant to Paragraph 5(i)(2) below on the fifth day of
such month for the period from and including the first day of the first month of
the immediately preceding calendar quarter to and including the last day of such
calendar quarter, with the actual amount confirmed by notification by the Lead
Administrative Agent to the Company (which notification may be telephonic and
which, if telephonic, shall be promptly confirmed in writing) given no later
than 9:00 a.m. (Los Angeles time) on the due date of payment thereof; and
(4) From time to time upon the request of any Lender, deliver to the Company a
funding indemnification billing for amounts payable to such Lender pursuant to
Paragraph 4(e) above or a billing for amounts payable to such Lender pursuant to
Paragraphs 4(g), 4(h) and 4(i) above and Paragraph 5(l) below.
The Company shall pay the full amount of interest and fees of which it has been
notified pursuant to subparagraphs (1) and (3) above on the fifth day of each
month, shall pay the full amount of interest of which it has been notified
pursuant to subparagraph (2) above on the date such notification is given and
shall pay the full amount of each billing delivered to it pursuant to
subparagraph (4) above within five Business Days thereafter. Interest payable
with respect to Buy-Down Loans prior to the occurrence of an Event of Default
and acceleration of the Obligations shall be billed to the Company directly by
each Buy-Down Lender in accordance with the timeframes set forth in subparagraph
(1) above, and the Company shall pay the full amount of interest due on Buy-Down
Loans directly to such Buy-Down Lender on the fifth day of each month. Following
the occurrence of an Event of Default and acceleration of the Obligations,
interest payable on all Loans shall be billed through the Lead Administrative
Agent.
5(e) Nature and Place of Payments. Except as otherwise expressly provided in the
Credit Documents, all
----------------------------
payments made on account of the Obligations shall be made to the Lead
Administrative Agent at the Contact Office for distribution to the Lenders, as
the Company shall, subject to Paragraph 5(h) below, direct pursuant to a Loan
Request, Interest Rate Election and Payoff Notice, without set-off or
counterclaim in lawful money of the United States of America in immediately
available same day funds, and must be received by the Lead Administrative Agent
accompanied by a Loan Request, Interest Rate Election and Payoff Notice at the
Contact Office by 11:30 a.m. (Los Angeles time) on the day of payment, it being
expressly agreed and understood that if a payment is received after 11:30 a.m.
(Los Angeles time) by the Lead Administrative Agent or the Lead Administrative
Agent does not receive a Loan Request, Interest Rate Election and Payoff Notice
therefor, such payment will be considered to have been made on the next
succeeding Business Day or such later date as the Lead Administrative Agent
receives the Loan Request, Interest Rate Election and Payoff Notice therefor and
interest thereon shall be payable by the Company at the then applicable rate
during such extension. If any payment required to be made by the Company
hereunder becomes due and payable on a day other than a Business Day, the due
date thereof shall be extended to the next succeeding Business Day and interest
thereon shall be payable at the then applicable rate during such extension. The
Lead Administrative Agent is hereby authorized to debit accounts of the Company
maintained with the Lead Administrative Agent for amounts payable by the Company
under this Agreement through the Lead Administrative Agent and the Lead
Administrative Agent will promptly notify the Company of any such debit.
5(f) Post-Default Interest. Following the occurrence of an Event of Default and
until such Event of
---------------------
Default is cured or waived as provided herein, Obligations shall bear interest
at a per annum rate equal to the Alternate Base Rate plus three percent (3%).
5(g) Computations. All computations of interest and fees payable hereunder shall
be based upon a year of
------------
360 days for the actual number of days elapsed. The determination by the Lead
Administrative Agent of any interest rate hereunder shall be conclusive and
binding on the Company and the Lenders absent manifest error.
5(h) Disbursement of Payments Received.
---------------------------------
(1) All amounts received by the Lead Administrative Agent on account of the
Obligations shall be disbursed by the Lead Administrative Agent to the Lenders
by wire transfer prior to the cut-off deadline of the Federal Reserve Wire
System on the date of receipt if received by the Lead Administrative Agent
before 11:30 a.m. (Los Angeles time) and accompanied by a Loan Request, Interest
Rate Election and Payoff Notice (or disbursed on the day of receipt although
received later than 11:30 a.m. (Los Angeles time) with the agreement of the Lead
Administrative Agent and any Lender) or if received later or if the Lead
Administrative Agent has not received a Loan Request, Interest Rate Election and
Payoff Notice therefor, on the next succeeding Business Day or such later date
as the Lead Administrative Agent receives the Loan Request, Interest Rate
Election and Payoff Notice relating thereto, without interest payable by the
Lead Administrative Agent.
(2) Prior to the occurrence of an Event of Default and acceleration of the
Obligations, amounts received by the Lead Administrative Agent on account of the
Obligations shall be disbursed in accordance with the written direction of the
Company, subject only to the requirements that amounts disbursed to the Lenders
on account of Primary Loans or the Term Loan be disbursed pro rata in accordance
with the Lenders' respective Primary Percentage Shares and that amounts
disbursed to the Swing Line Lenders on account of Swing Loans be disbursed pro
rata in accordance with the Swing Line Lenders' respective Swing Line Percentage
Shares.
(3) Following the occurrence of an Event of Default and acceleration of the
Obligations, amounts received by the Lead Administrative Agent on account of the
Obligations shall be disbursed as follows: (i) first among the Lenders, pro rata
in accordance with their respective Primary Percentage Shares, on account of the
Obligations until the Obligations have been paid in full, and (ii) then, to the
Lead Administrative Agent with respect to the remaining Obligations held by it
in its capacity as Lead Administrative Agent until such Obligations have been
paid in full.
5(i) Fees. The Company shall pay:
----
(1) To the Lead Administrative Agent, such fees as may from time to time be
agreed upon in writing by the Lead Administrative Agent and the Company;
and
(2) To each of the Lenders, a facility fee, said fee to be payable
quarterly in arrears on the fifth day of the first month of each calendar
quarter for the period from and including the first day of the first month
of the immediately preceding calendar quarter to and including the last day
of such calendar quarter and on the Revolving Facility Maturity Date or,
following the Conversion Date, the Final Maturity Date, in an amount equal
to such Lender's daily average Primary Percentage Share during the
applicable calculation period multiplied by: (i) (y) to and including the
Revolving Facility Maturity Date, the average daily Aggregate Credit Limit
during such calculation period and (z) following the Conversion Date, the
average daily outstanding principal balance of the Term Loan, multiplied by
(ii) the product of a. 0.08% and b. a fraction the numerator of which is
the number of days in the applicable calculation period and the denominator
of which is 360.
5(j) Wire Transfers of Funds. Notwithstanding anything to the contrary
contained herein and in the other
-----------------------
Credit Documents, funds which the Lead Administrative Agent and the Lenders are
transmitting by wire transfer shall be deemed to have been sent and received
upon release by the transmitting party of such funds into the Federal Reserve
Wire System.
5(k) Reduction in Aggregate Credit Limit. From the Effective Date to but not
including the Revolving
-----------------------------------
Facility Maturity Date, upon not less than thirty (30) days' prior written
notice to the Lead Administrative Agent, which shall promptly transmit such
notice to each of the Lenders, the Company may permanently reduce the Aggregate
Credit Limit in full or in increments of $5,000,000.00 (with such reduction
allocated pro rata against the Lenders' respective Maximum Commitments);
provided, however, that any such reduction shall be in a minimum amount of
$25,000,000.00; and, provided, further, that upon the effective date of any such
reduction, the aggregate amount of Loans outstanding shall not exceed the
Aggregate Credit Limit as so reduced.
5(l) Capital Requirements. The Company shall pay from time to time upon demand
such amounts as any Lender
--------------------
may determine to be necessary to compensate such Lender for all reasonable costs
which such Lender determines are attributable to its making, agreeing to make,
purchasing or maintaining its Primary Percentage Share of any Primary Loan or,
following the Conversion Date, of the Term Loan, or its Swing Line Percentage
Share of any Swing Loan under this Agreement, including, without limitation,
reserve requirements attributed to the unused portion of the Aggregate Credit
Limit, in respect of any amount of capital required to be maintained by such
Lender pursuant to any law or regulation of any jurisdiction or any
interpretation, directive or request affecting banks, savings and loan
institutions and/or financial institutions generally notwithstanding the
creditworthiness of any particular bank, savings and loan institution or other
financial institution (whether or not having the force of law) of any court or
governmental or monetary authority, whether in effect on the date of this
Agreement or thereafter. A certificate as to any amounts payable pursuant hereto
submitted by a Lender to the Company shall be conclusive in the absence of
manifest error. The obligations of the Company under this Paragraph 5(l) shall
survive the termination of this Agreement and the payment of all Loans and all
other Obligations.
5(m) Extension of Revolving Facility Maturity Date.
---------------------------------------------
(1) The Company may, by written notice to the Lead
Administrative Agent (such notice being an "Extension Notice") given no
earlier than ninety (90) days and no later than forty-five (45) days
prior to the then current Revolving Facility Maturity Date, request the
Lenders to consider an extension of the then current Revolving Facility
Maturity Date to a date 364 days after the then current Revolving
Facility Maturity Date. The Lead Administrative Agent shall promptly
transmit any Extension Notice to each Lender. Each Lender shall notify
the Lead Administrative Agent in writing whether it agrees to so extend
the then current Revolving Facility Maturity Date no later than twenty
(20) days prior to the then current Revolving Facility Maturity Date,
and any such notice given by a Lender to the Lead Administrative Agent,
once given, shall be irrevocable as to such Lender. Any Lender which
does not expressly and timely notify the Lead Administrative Agent that
it agrees to so extend the then current Revolving Facility Maturity
Date shall be deemed to have rejected the Company's request for
extension thereof. Lenders agreeing to extend the then current
Revolving Facility Maturity Date are hereinafter referred to as
"Continuing Lenders," and Lenders declining to consent to the extend
thereof (or Lenders deemed to have so declined) are hereinafter
referred to as "Non-Extending Lenders". If the Majority Lenders elect
to so extend the then current Revolving Facility Maturity Date, the
Lead Administrative Agent shall notify the Company of such election no
later than fifteen (15) days prior to the then current Revolving
Facility Maturity Date, and effective on the then current Revolving
Facility Maturity Date and subject to the conditions precedent to such
extension set forth in Paragraph 7(c) below, the Revolving Facility
Maturity Date shall be automatically deemed so extended and the
Aggregate Credit Limit shall be automatically deemed to be the
aggregate Maximum Commitments of the Continuing Lenders (including, if
applicable, any new Lenders who become Continuing Lenders pursuant to
subparagraph (4) below). Upon the delivery of an Extension Notice the
Company shall be deemed to have represented and warranted that on and
as of the date of such Extension Notice no Potential Default or Event
of Default has occurred and is continuing. It is expressly acknowledged
and agreed by the Company that no Lender shall have any obligation to
extend any Revolving Facility Maturity Date, or, having agreed to such
an extension on any one or more occasions, to agree to any future
extension and that any such decision by a Lender is in such Lender's
sole and absolute discretion.
(2) If a Revolving Facility Maturity Date shall have
been extended in accordance with subparagraph (1) above, then upon the
effectiveness of such extension, all references herein to the
"Revolving Facility Maturity Date" shall refer to the Revolving
Facility Maturity Date as so extended.
(3) If any Lender shall elect not to extend the then
current Revolving Facility Maturity Date as requested by any Extension
Notice given by the Company pursuant to subparagraph (1) above but the
Majority Lenders have agreed to do so, then concurrently with the
effectiveness of such extension, the Maximum Commitment of such Lender
shall terminate and the Company shall on such date pay to the Lead
Administrative Agent, for the account of such Lender, the principal
amount of, and accrued interest on, such Lender's Loans, together with
any amounts payable to such Lender pursuant to Paragraph 4(e) above and
any fees or other amounts owing to such Lender under this Agreement and
the other Credit Documents. Following such termination, the
Non-Extending Lender shall retain the benefits of Paragraphs 4(g) and
4(h) above and Paragraph 9(g) below as the same relate to the period
prior to the effective date of such termination.
(4) A Non-Extending Lender shall be obligated, at the
request of the Company and subject to payment by the Company to the
Lead Administrative Agent for the account of such Non-Extending Lender
of the principal amount of, and accrued interest on, such Lender's
Loans, together with any amounts payable to such Lender pursuant to
Paragraph 4(e) above and any fees or other amounts owing to such Lender
under this Agreement and the other Credit Documents, to transfer its
Maximum Commitment or portions thereof to an Applicant Financial
Institution and/or to one or more Continuing Lenders on the terms and
subject to the conditions set forth in Paragraphs 14(a), 14(b) and
14(c) below, any such transfer to be without recourse, representation,
warranty (other than good title to its Loans) or expense to such
Non-Extending Lender, at any time prior to the then current Revolving
Facility Maturity Date. Each such transferee, if not already a
Continuing Lender hereunder, shall become a Continuing Lender hereunder
in replacement of the Non-Extending Lender to the extent of the Maximum
Commitment transferred to it shall enjoy all rights and assume all
obligations on the part of the Lenders set forth in this Agreement and
the other Credit Documents. Following such termination, the
Non-Extending Lender shall retain the benefits of Paragraphs 4(g) and
4(h) above and Paragraph 9(g) below as the same relate to the period
prior to the effective date of such termination.
(5) No Loan Request, Interest Rate Election and
Payoff Notice delivered prior to the then current Revolving Facility
Maturity Date and requesting the funding of a Loan following such then
current Revolving Facility Maturity Date shall be applicable to a
Non-Extending Lender; provided, however, that nothing contained herein
shall in any manner or to any extent relieve a Non-Extending Lender
from its funding obligations hereunder prior to such current Revolving
Facility Maturity Date.
6. Guaranty; Subordination; Additional Documents.
---------------------------------------------
6(a) Guaranty and Subordination Agreement. As support for the Obligations, the
Company shall execute and
------------------------------------
deliver and shall cause to be executed and delivered to the Lead Administrative
Agent on behalf of the Lenders: (1) the Guaranty and
(2) the Subordination Agreement.
6(b) Further Documents. The Company agrees to execute and deliver and to cause
to be executed and
-----------------
delivered to the Lead Administrative Agent or such Persons as the Lead
Administrative Agent may direct from time to time such documents, instruments
and agreements as the Lead Administrative Agent on behalf of the Lenders may
reasonably request, which are in any of the Lenders' judgment necessary or
desirable to obtain for the Lead Administrative Agent, the Co-Administrative
Agent, the Documentation Agent, the Syndication Agent, the Arranger, the
Co-Arrangers, the Co-Agents and the Lenders the benefit of the Credit Documents.
7. Conditions Precedent.
--------------------
7(a) First Loan. As conditions precedent to the Effective Date and the funding
of the first Loan hereunder:
----------
(1) There shall have been delivered to the Lead Administrative Agent, in
form and substance and in quantities reasonably satisfactory to the Lenders and
their counsel, the following:
(i) A duly executed copy of this Agreement;
(ii) A duly executed copy of each of the Guaranty;
(iii) A duly executed copy of the Subordination Agreement;
(iv) Such credit applications, financial statements, pro forma financial
statements, authorizations and information concerning the Company and its
business, operations and condition (financial and otherwise) as the Lead
Administrative Agent or any Lender may reasonably request;
(v) Certified copies of resolutions of the Boards of Directors of the
Company and the Parent approving the execution and delivery of all
documents required to be delivered by the Company and the Parent hereunder;
(vi) Certificates of the Secretary or an Assistant Secretary of each of the
Company and the Parent certifying the names, incumbency and true signatures
of the officers of the Company and the Parent authorized to sign the
documents required to be executed and delivered by the Company and the
Parent hereunder;
(vii) An opinion of counsel for the Company and the Parent (which counsel
may be in-house counsel) in form and substance satisfactory to the Lenders
and covering such matters as the Lenders may reasonably request;
(viii) A certificate of an executive officer of each of the Company and the
Parent in the form of that attached hereto as Exhibit A dated as of the
date of this Agreement; and
---------
(ix) A Covenant Compliance Certificate, dated as of February 29, 2000, for
each of the Company and the Parent demonstrating in detail satisfactory to
the Lenders the Company's compliance with the covenants set forth in
Paragraphs 10(g), 10(i) and 10(j) below, and the Parent's compliance with
the financial covenants set forth in Paragraphs 11(d) and 11(e) of the
Guaranty.
(2) All acts and conditions (including, without limitation, the obtaining
of all necessary regulatory approvals and the making of all required
filings, recordings and registrations) required to be done and performed
and to have happened precedent to the execution, delivery and performance
of the Credit Documents and to constitute the same legal, valid and binding
obligations, enforceable in accordance with their respective terms, shall
have been done and performed and shall have happened in due and strict
compliance with all applicable laws.
(3) All documentation, including, without limitation, documentation for
corporate and legal proceedings in connection with the transactions
contemplated by the Credit Documents, shall be satisfactory in form and
substance to the Lenders and their counsel.
(4) The Company shall have delivered to the Arranger a letter acceptable to
the Arranger regarding the payment by the Company to the Arranger of fees,
and the Company shall have paid all fees required under such letter to have
been paid prior to the funding of the first Loan hereunder.
(5) No material adverse change in the business, operations, assets or
financial or other condition of the Company or the Company and its
consolidated Subsidiaries taken as a whole shall have occurred since the
Statement Date and the Company by presenting the initial Loan Request,
Interest Rate Election and Payoff Notice shall be deemed to have so
represented and warranted hereunder.
(6) There shall be no "Loans" or other "Obligations" outstanding under (and
as those terms are defined in) the Existing Credit Agreement.
7(b) All Primary Loans and Swing Loans. As conditions precedent to the
funding of each Primary Loan and
---------------------------------
Swing Loan hereunder, including the first such Loan, at and as of the date of,
and after giving effect to, the funding of such Loan:
(1) The representations and warranties of the Company and the Parent
contained in the Credit Documents shall be accurate and complete in all
respects as of such date;
(2) If there has occurred a Potential Default or an Event of Default (other
than under Paragraph 11(a) below or under Paragraph 11(e) below resulting
from a breach or potential breach of Paragraph 10(i) or 10(j) below), the
Majority Lenders have not elected in writing to cease funding Loans
hereunder;
(3) If there has occurred an Event of Default under Paragraph 11(a) below,
one hundred percent (100%) of the Lenders have elected in writing to waive
such Event of Default;
(4) If there has occurred an Event of Default or Potential Default under
Paragraph 11(e) below resulting from a breach or potential breach of
Paragraph 10(i) or 10(j) below, the Majority Lenders have elected in
writing to waive such Event of Default or Potential Default;
(5) Following the making of such Loan, the aggregate principal amount of
Primary Loans and Swing Loans outstanding shall not exceed the applicable
limitations of Paragraphs 1(a) and 1(b) above nor shall the aggregate
principal amount of Primary Loans held by any Lender plus such Lender's
Percentage Share of Swing Loans outstanding or exceed such Lender's Maximum
Commitment; and
(6) The Company shall have delivered to the Lead Administrative Agent a
duly executed Loan Request, Interest Rate Election and Payoff Notice
requesting such Credit Event. By delivering a Loan Request, Interest Rate
Election and Payoff Notice to the Lead Administrative Agent, the Company
shall be deemed to have represented and warranted the accuracy and
completeness of the statements set forth in subparagraphs (b)(1) through
(b)(6) above and all information set forth in such Loan Request, Interest
Rate Election and Payoff Notice.
7(c) Extension of Revolving Facility Maturity Date; Term Loan. As
conditions precedent to the
--------------------------------------------------------
effectiveness of any extension of the Revolving Facility Maturity Date pursuant
to Paragraph 5(m) above or the conversion of Loans outstanding to the Term Loan,
on and as of the proposed effective date of such extension or the Conversion
Date, as applicable:
(1) The representations and warranties of the Company and the Parent
contained in the Credit Documents shall be accurate and complete in all
respects as of such date;
(2) There shall not have occurred a Potential Default or an Event of
Default; and
(3) In the case of the Conversion Date, after giving effect to the
conversion of Loans outstanding into the Term Loan, no Lender's Primary
Percentage Share of the Term Loan shall exceed such Lender's Maximum
Commitment.
By delivering an Extension Notice or a Loan Request, Interest Rate Election and
Payoff Notice for the Term Loan to the Lead Administrative Agent, the Company
shall be deemed to have represented and warranted the accuracy and completeness
of the statements set forth in subparagraphs (c)(1) through (c)(3) above.
8. Representations and Warranties of the Company. As an
inducement to the Lead Administrative Agent, the Co-Administrative Agent, the
Documentation Agent, the Syndication Agent, the Arranger, the Co-Arrangers, the
Co-Agents and each Lender to enter into this Agreement, the Company represents
and warrants to the Lead Administrative Agent, the Co-Administrative Agent, the
Documentation Agent, the Syndication Agent, the Arranger, the Co-Arrangers, the
Co-Agents and each Lender that:
8(a) Financial Condition. The financial statements dated the Statement
Date, copies of which have
-------------------
heretofore been furnished to each Lender, are complete and correct and present
fairly in accordance with GAAP the consolidated and consolidating financial
condition of the Company and its consolidated Subsidiaries at such date and the
consolidated and consolidating results of their operations and changes in
financial position for the fiscal period then ended.
8(b) Corporate Existence; Compliance with Law. Each of the Company and its
Subsidiaries: (1) is duly
----------------------------------------
organized, validly existing and in good standing as a corporation under the laws
of the state of its incorporation, and is in good standing as a foreign
corporation in each jurisdiction where its ownership of property or conduct of
business requires such qualification and where failure to be in good standing
could have a material adverse effect on the Company, any of its Subsidiaries, or
their respective property and/or business or on the ability of the Company or
the Parent to pay or perform the Credit Documents; (2) has the corporate power
and authority and the legal right to own and operate its property and to conduct
business in the manner in which it does and proposes so to do; and (3) is in
compliance with all Requirements of Law and Contractual Obligations except to
the extent that failure to comply could not have a material adverse effect on
the Company, any of its Subsidiaries, or their respective property and/or
business or on the ability of the Company or the Parent to pay or perform the
Credit Documents.
8(c) Corporate Power; Authorization; Enforceable Obligations. Each of the
Company and the Parent has the
-------------------------------------------------------
corporate power and authority and the legal right to execute, deliver and
perform the Credit Documents to which it is a party and, in the case of the
Company, to borrow hereunder, and has taken all necessary corporate action to
authorize the execution, delivery and performance of the Credit Documents. The
Credit Documents have been duly executed and delivered on behalf of each of the
Company and the Parent and constitute legal, valid and binding obligations of
such party enforceable against such party in accordance with their respective
terms.
8(d) No Legal Bar. The execution, delivery and performance of the Credit
Documents, the borrowings
------------
thereunder and the use of the proceeds thereof, will not violate any Requirement
of Law or any Contractual Obligation of the Company or the Parent to the extent
that failure to comply therewith could have a material adverse effect on the
Company or its property and/or business or on the ability of the Company or the
Parent to pay or perform the Credit Documents.
8(e) No Material Litigation. Except as disclosed on Exhibit B attached
hereto, no litigation,
----------------------
investigation or proceeding of or before any court, arbitrator or Governmental
Authority is pending or, to the knowledge of the Company, threatened by or
against the Company or any of its Subsidiaries or against any of such parties'
properties or revenues involving amounts, in the case of any such individual
litigation, investigation or proceeding, in excess of $10,000,000.00 or which,
regardless of the amount in controversy, is likely to be adversely determined
and which, if adversely determined, could have a material adverse effect on the
business, operations, property or financial or other condition of the Company or
any of its Subsidiaries.
8(f) Taxes. The Company and each of its Subsidiaries have filed or caused
to be filed all tax returns that
-----
are required to be filed and have paid all taxes (other than incidental local
business and other municipal taxes which are not material to the operation of
the Company and its Subsidiaries) shown to be due and payable on said returns or
on any assessments made against them or any of their property other than taxes
which are being contested in good faith by appropriate proceedings and as to
which the Company or the applicable Subsidiary has established adequate reserves
in conformity with GAAP.
8(g) Investment Company Act. The Company is not an "investment company" or
a company "controlled" by an
----------------------
"investment company" within the meaning of the Investment Company Act of
1940, as amended.
8(h) Subsidiaries. Exhibit C attached hereto sets forth an accurate
and complete list of all presently
------------ ---------
existing Subsidiaries of the Company, their respective jurisdictions of
incorporation and the percentage of their capital stock owned by the Company or
other Subsidiaries of the Company. All of the issued and outstanding shares of
capital stock of the Subsidiaries of the Company have been duly authorized and
issued and are fully paid and non-assessable.
8(i) Federal Reserve Board Regulations. Neither the Company nor any of its
Subsidiaries is engaged or will
---------------------------------
engage, principally or as one of its important activities, in the business of
extending credit for the purpose of "purchasing" or "carrying" any "margin
stock" within the respective meanings of such terms under Regulation U. No part
of the proceeds of any Loan made hereunder will be used for "purchasing" or
"carrying" "margin stock" as so defined or for any purpose which violates, or
which would be inconsistent with, the provisions of the Regulations of the Board
of Governors of the Federal Reserve System.
8(j) ERISA. The Company and each of its Subsidiaries are in compliance in
all material respects with the
-----
requirements of ERISA and no Reportable Event has occurred under any Plan
maintained by the Parent, the Company or any of its or their Subsidiaries which
is likely to result in the termination of such Plan for purposes of Title IV of
ERISA.
8(k) Assets. The Company and each of its Subsidiaries have good and
marketable title to all property and
------
assets reflected in the financial statements referred to in Paragraph 8(a)
above, except property and assets sold or otherwise disposed of in the ordinary
course of business subsequent to that date. Neither the Company nor any of its
Subsidiaries has outstanding Liens on any of its properties or assets nor are
there any security agreements to which the Company or any of its Subsidiaries is
a party, or title retention agreements, whether in the form of leases or
otherwise, of any personal property except as reflected in said financial
statements referred to in Paragraph 8(a) above or as permitted under Paragraph
10(a) below.
9. Affirmative Covenants. The Company hereby covenants and agrees with the
Lead Administrative Agent and each
---------------------
Lender that, as long as any Obligations remain unpaid or any Lender has any
obligation to make all or any portion of any Loans, the Company shall:
9(a) Financial Statements. Furnish or cause to be furnished directly to the
Lead Administrative Agent and
--------------------
each Lender:
(1) Within ninety (90) days after the last day of each fiscal year of the
Parent, consolidated statements of income and statements of changes in cash
flow of the Parent and its Subsidiaries for such year and a balance sheet
as of the end of such year (including therein as supplemental information,
consolidating statements of income and statements of changes in cash flow
and balance sheets as of the end of such year) in each case presented
fairly in accordance with GAAP and, in the case of the Company, the
requirements of HUD Handbook IG 4000.3 REV and accompanied, in all cases,
by an unqualified report of a firm of independent certified public
accountants acceptable to the Majority Lenders;
(2) Within forty-five (45) days after the last day of each fiscal quarter,
consolidated and consolidating statements of income and statements of
changes in cash flow of the Parent and its Subsidiaries for such fiscal
quarter and balance sheets of the Parent and its Subsidiaries as of the
last day of such fiscal quarter, presented fairly in accordance with GAAP,
in each case certified in writing as to fairness of presentation by the
chief financial officer or treasurer of the Company and the Parent;
(3) Within forty-five (45) days following each Applicable Financial Test
Date, a Covenant Compliance Certificate from the chief financial officer or
treasurer of each of the Company and the Parent, certifying that there does
not exist an Event of Default or Potential Default and, in addition,
demonstrating in detail satisfactory to the Majority Lenders the Company's
compliance with the covenants set forth in Paragraphs 10(g), 10(i) and
10(j) below as of and at such Applicable Financial Test Date, and the
Parent's compliance with the covenants set forth in Paragraphs 11(d) and
11(e) of the Guaranty, as of and at such Applicable Financial Test Date;
(4) As soon as is available any written report pertaining to material items
in respect of the internal control matters of the Parent or the Company
submitted to any of such Persons by their respective independent
accountants in connection with each annual or interim special audit of the
financial condition of such Persons made by such independent public
accountants; and
(5) Copies of all proxy statements, financial statements, and reports which
the Parent sends to its stockholders, and copies of all regular, periodic
and special reports, and all registration statements under the Securities
Act of 1933, as amended (the "Act"), which the Parent or the Company files
with the Securities and Exchange Commission or any governmental authority
which may be substituted therefor, or with any national securities
exchange; provided, however, that there shall not be required to be
delivered hereunder to the Lead Administrative Agent such copies for any
Lender of prospectuses relating to future series of offerings under
registration statements filed under Rule 415 of the Act or other items
which such Lender has indicated in writing to the Parent or the Company
from time to time need not be delivered to such Lender.
9(b) Certificates; Reports; Other Information. Furnish or cause to be
furnished directly to the Lead
----------------------------------------
Administrative Agent and each Lender:
(1) Within forty-five (45) days following each Applicable Financial Test
Date, prepared as of such Applicable Financial Test Date and certified by
an appropriate officer of the Company, a report covering the servicing
portfolio of the Company covering such matters as the Majority Lenders,
through the Lead Administrative Agent, may reasonably request (but which
shall in any event list the aggregate principal amount of mortgage notes
serviced and the number and types of loans evidenced by such notes, and
show all loans in the servicing portfolio more than thirty (30) days past
due the due dates set forth in such notes).
(2) Promptly, such additional financial and other information, including,
without limitation, financial statements of the Company, the Parent or any
Affiliate of the Company or the Parent, as any Lender, through the Lead
Administrative Agent, may from time to time reasonably request, including,
without limitation, such information as is necessary for any Lender to
participate out any of its interests in Loans hereunder or to enable
another financial institution to become a signatory hereto.
(3) Promptly upon receipt thereof by the Company, copies of all audit
reports prepared by or on behalf of FNMA, FHLMC and GNMA.
9(c) Payment of Indebtedness. Pay, discharge or otherwise satisfy at or
before maturity or before it
-----------------------
becomes delinquent, defaulted or accelerated, as the case may be, all its
Indebtedness, except: (1) Indebtedness (other than Indebtedness with respect to
CPNs) being contested in good faith and for which provision is made to the
satisfaction of the Majority Lenders for the payment thereof in the event the
Company is found to be obligated to pay such Indebtedness and which Indebtedness
is thereupon promptly paid by the Company, and (2) additional Indebtedness
(other than Indebtedness with respect to CPNs) in the aggregate not to exceed
$100,000.00.
9(d) Maintenance of Existence and Properties. Maintain all rights,
privileges, licenses, approvals,
---------------------------------------
franchises, properties and assets necessary in the normal conduct of its
business, and comply with all Contractual Obligations and Requirements of Law.
The Company will at all times be a FNMA, FHLMC and GNMA-approved Seller/
Servicer and a wholly-owned Subsidiary of the Parent.
9(e) Inspection of Property; Books and Records; Discussions. Keep proper
books of record and account in
------------------------------------------------
which full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and transactions in relation
to its business and activities, and permit representatives of each Lender (at no
cost or expense to the Company unless there shall have occurred and be
continuing an Event of Default) to visit and inspect those of its properties and
examine and make abstracts from those of its books and records as are reasonably
necessary to enable such Lender to conduct appropriate credit due diligence in
connection with customary credit approval practices for credit facilities of
this type, at any reasonable time and as often as may reasonably be desired by
any of the Lenders, and to discuss the business, operations, properties and
financial and other condition of the Company and any of its Subsidiaries with
officers and employees of such parties, and with their independent certified
public accountants.
9(f) Notices. Promptly give written notice to the Lead Administrative Agent
(who shall promptly notify
-------
each of the Lenders thereof) of:
(1) The occurrence of any Potential Default or Event of Default;
(2) Any litigation or proceeding affecting the Company or any of its
Subsidiaries involving amounts, in the case of any such individual
litigation, investigation or proceeding, in excess of $10,000,000.00 or
which, regardless of the amount in controversy, is likely to be adversely
determined and which, if adversely determined, could have a material
adverse effect on the business, operations, property, or financial or other
condition of the Company or the ability of the Company to pay and perform
the Obligations;
(3) Receipt by the Company or the Parent of notice from any rating agency
concerning a potential change in any credit rating previously accorded the
Company or the Parent by such rating agency; and
(4) A material adverse change in the business, operations, property or
financial or other condition of the Parent, the Company or any of their
Subsidiaries.
9(g) Expenses. Pay all reasonable out-of-pocket expenses (including fees
and disbursements of counsel) of
--------
the Lead Administrative Agent, the Arranger and the Co-Arrangers incident to the
preparation, negotiation, administration and amendment of the Credit Documents
and, following the occurrence of an Event of Default, of the Lead Administrative
Agent and each of the Lenders incident to the protection of the rights of the
Lenders, the Arranger, the Co-Arrangers and the Lead Administrative Agent under
the Credit Documents, and incident to the enforcement of payment of the
Obligations, whether by judicial proceedings or otherwise, including, without
limitation, in connection with bankruptcy, insolvency, liquidation,
reorganization, moratorium or other similar proceedings involving the Parent or
the Company or a "workout" of the Obligations. The obligations of the Company
under this Paragraph 9(g) shall be effective and enforceable whether or not any
Loan is advanced by any Lender hereunder and shall survive payment of all other
Obligations.
9(h) Credit Documents. Comply with and observe all terms and conditions of
the Credit Documents.
----------------
9(i) Insurance. Obtain and maintain insurance with responsible companies in
such amounts and against such
---------
risks as are usually carried by corporations engaged in similar businesses
similarly situated, including, without limitation, errors and omissions coverage
and fidelity coverage in form and substance acceptable under FNMA or FHLMC
guidelines, and furnish the Lenders on request full information as to all such
insurance.
9(j) CPN Program. Obtain the written approval of the Majority Lenders to
any modification of the
-----------
documentation relating to the issuance of CPNs of the Company as in effect
on the date of this Agreement.
9(k) Hedging Program. Maintain at all times a Hedging Program consistent
with the Hedging Program in
---------------
effect at and as of the Effective Date.
10. Negative Covenants. The Company hereby agrees that, as long as any
Obligations remain unpaid or any Lender has
------------------
any obligation to make all or any portion of any Loans, the Company shall
not, directly or indirectly:
10(a)Liens. Create, incur, assume or suffer to exist any Lien upon any of
its property and assets
-----
(including servicing rights) other than:
(1) Liens or charges for current taxes, assessments or other governmental
charges which are not delinquent or which remain payable without penalty,
or the validity of which are contested in good faith by appropriate
proceedings upon stay of execution of the enforcement thereof, provided the
Company shall have set aside on its books and shall maintain adequate
reserves for the payment of same in conformity with GAAP;
(2) Liens, deposits or pledges made to secure statutory obligations, surety
or appeal bonds, or bonds for the release of attachments or for stay of
execution, or to secure the performance of bids, tenders, contracts (other
than for the payment of borrowed money), leases or margin call requirements
or for purposes of like general nature in the ordinary course of the
Company's business;
(3) Liens on Mortgage Loans and Mortgage-Backed Securities which are the
subject of repurchase agreements;
(4) Liens on real property (including fixtures and improvements thereon)
securing Indebtedness in an amount not to exceed $50,000,000.00 in the
aggregate at any time outstanding;
(5) Liens on property and assets of the Company securing short term
Indebtedness of the Company (Indebtedness with a maturity of one year or
less and not automatically renewable by the Company at its sole option) in
an amount not to exceed at any date twenty five percent (25%) of Mortgage
Loans and MBS Held for Sale; and
(6) Liens on servicing rights of the Company securing Indebtedness in an
amount not to exceed at any date ten percent (10%) of Mortgage Servicing
Rights.
10(b)Indebtedness. Create, incur, assume or suffer to exist, or otherwise
become or be liable in respect
------------
of any Indebtedness if upon such creation, incurrence or assumption there would
exist an Event of Default or the Company would fail to be in compliance with the
requirements of Paragraphs 10(i) or 10(j) below (assuming such compliance were
tested at such date immediately following such creation, incurrence or
assumption).
10(c)Consolidation and Merger. Liquidate or dissolve or enter into any
consolidation, merger, partnership,
------------------------
joint venture, syndicate or other combination, except that the Company may be
consolidated with or merged with any corporation provided that (1) in any such
merger or consolidation the Company shall be the surviving or resulting
corporation and (2) at the time of and immediately after the effectiveness of
such merger or consolidation there shall not have occurred and be continuing an
Event of Default or Potential Default.
10(d)Acquisitions. Purchase or acquire or incur liability for the purchase
or acquisition of any or all of
------------
the assets or business of any Person other than in the normal course of a
mortgage banking-related business (it being expressly agreed and understood that
the acquisition of servicing is a normal course of business activity); provided,
however, that the Company may acquire all or a portion of the stock or assets of
another mortgage company or companies so long as no Event of Default or
Potential Default shall exist immediately following the consummation of such
acquisition, and, provided, further, that the Company shall be in compliance
with the financial covenants set forth in Paragraphs 10(i) and 10(j) below,
assuming for purposes of this Paragraph 10(d) that the "Applicable Financial
Test Date" referenced in such covenants is the day immediately following the
consummation of such acquisition.
10(e)Payment of Dividends. Declare or pay any dividends upon any shares of
the Company's stock now or
--------------------
hereafter outstanding, except dividends payable in the capital stock of the
Company, or make any distribution of assets to its stockholders as such, whether
in cash, property or securities, if at the date of payment or distribution
(either before or after giving effect thereto) there should exist an Event of
Default or Potential Default.
10(f)Purchase or Retirement of Stock. Acquire, purchase, redeem or retire
any shares of its capital stock
-------------------------------
now or hereafter outstanding for value.
10(g)Investments; Advances; Receivables. Make or commit to make any
advance, loan or extension of credit
----------------------------------
("Advances") to, or hold any receivable ("Receivable") of, or make or commit to
make any capital contribution to, or purchase any stock, bonds, notes,
debentures or other securities ("Investments") of, or make any other investment
in, any Person, except:
(1) Advances constituting Mortgage Loans made in the ordinary course of the
Company's
business;
(2) Advances to and Receivables of any Person which are fully secured on a
first
priority perfected basis by Mortgage Loans;
(3) Investments in, Advances to and Receivables of any Affiliate which are
fully secured on a first priority perfected basis by Mortgage Loans or
Prime Quality Mortgage-Backed Securities;
(4) Investment in, Advances to and Receivables of any Affiliate or any
Servicing Pass-Through Venture which is not otherwise an Affiliate, which
are unsecured or which are secured on a first priority perfected basis by
collateral other than Mortgage Loans or Prime Quality Mortgage-Backed
Securities, in an aggregate amount not to exceed fifteen percent (15%) of
the net worth of the Company determined in accordance with GAAP; and
(5) Investments in, Advances to and Receivables of Countrywide Capital
Markets, Inc. or any of its Subsidiaries, which are fully secured on a
first priority perfected basis by: (i) debt instruments issued by FNMA or
FHLMC or (ii) time deposit accounts issued by a financial institution the
deposits of which are insured by the Bank Insurance Fund and which
financial institution has a deposit rating issued by a recognized rating
agency not less than the rating assigned to the Company's long term
indebtedness.
10(h)Sale of Assets. Sell, lease, assign, transfer or otherwise dispose of
any of its assets (other than
--------------
obsolete or worn out property), whether now owned or hereafter acquired, other
than in the ordinary course of business as presently conducted and at fair
market value (it being expressly agreed and understood that the sale or other
disposition of Mortgage Loans with or without servicing released and the sale or
other disposition of servicing rights are in the ordinary course of business);
provided, however, that in no event shall the Company enter into any sale and
leaseback transaction involving any of its assets without the prior written
consent of the Majority Lenders; and, provided further, that the Company may
sell, lease, assign, transfer or otherwise dispose of any of its assets to a
Subsidiary of the Company (which, for the purpose of this proviso shall include
any limited partnership the general and limited partners of which are
Subsidiaries of the Company) so long as: (1) all classes of stock of, or
partnership interests in, such Subsidiary are owned, directly or indirectly, by
the Company, (2) such Subsidiary incurs no obligations for third party
indebtedness except such obligations to employees and vendors as are necessary
or desirable in the normal conduct of the business of servicing 1-4 unit single
family mortgage loans and in managing an office building owned by such
Subsidiary, and (3) any such unpaid obligations as are described in subsection
(2) above (other than payroll and benefits obligations to employees) shall not
exceed at any time $50,000,000.00 in the aggregate.
10(i)Minimum Net Worth. Permit its net worth determined in accordance with
GAAP on and as of each
-----------------
Applicable Financial Test Date to be less than $1,200,000,000.00.
10(j)Maximum Total Debt. Permit Total Debt on and as of each Applicable
Financial Test Date to exceed the
------------------
sum of:
(1) One hundred percent (100%) of Cash, plus
(2) Ninety percent (90%) of Margins, plus
(3) Ninety-seven percent (97%) of the amount of Mortgage Loans and MBS Held
for Sale (including Mortgage Loans and Mortgage-Backed Securities subject
to a Lien under a repurchase agreement but excluding all other Mortgage
Loans and Mortgage-Backed Securities which are excluded from "Eligible
Mortgage Assets" pursuant to subparagraphs (a), (b) and (c) of the
definition of such term), plus
(4) Ninety percent (90%) of Pool Loan Purchases and Mortgage Claims
Receivable to the extent such assets represent VA and FHA Mortgage Loans
repurchased by the Company from pools supporting GNMA Mortgage-Backed
Securities, plus
(5) Fifty percent (50%) of Deferred Commitment Fees, plus
(6) Fifty percent (50%) of Property and Equipment, plus
(7) Seventy-five percent (75%) of Mortgage Servicing Rights, plus
(8) Fifty percent (50%) of Other Assets, excluding any unsecured Advances
made to Affiliates permitted under Paragraph 10(g)(2) above.
11. Events of Default. Upon the occurrence of any of the following events
(an "Event of Default"):
-----------------
11(a)The Company shall fail to make any payment on account of that portion
of the Obligations consisting of principal or interest on Loans on the date
when due; or
11(b)Any representation or warranty made or deemed made by the Company or
the Parent in any Credit Document or in connection with any Credit Document
shall be materially inaccurate or incomplete in any respect on or as of the
date made or
deemed made; or
11(c)The Company shall default in the observance or performance of any
covenant or agreement contained in Paragraph 10 above (other than those
contained in Paragraphs 10(i) and 10(j) above); or
11(d)The Parent shall fail to observe or comply with
any term or provision contained in the Guaranty (other
than those contained in Paragraph 11(d) thereof); or
11(e)The Company or the Parent shall fail to observe
or perform any other term or provision contained in
the Credit Documents and such failure shall continue for thirty (30) days; or
11(f)The Company, any of its Subsidiaries or the
Parent shall default in any payment of any Indebtedness (other than the
Obligations or as permitted under Paragraph 9(c) above) in an aggregate
amount of more than $10,000,000.00 or any other event shall occur and, as a
result, the holder or holders thereof, or any trustee or agent for such
holders, either: (1) cause such Indebtedness to become due and payable
prior to its stated maturity, or (2) elect not to cause such Indebtedness
to become so due and payable, but such event continues for a period of
thirty (30) days and is not cured or waived; or
11(g)(1) The Parent, the Company or any of its
Subsidiaries shall commence any case, proceeding or other action (i) under
any existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization or relief of debtors,
seeking to have an order for relief entered with respect to it, or seeking
to adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition
or other relief with respect to it or its debts, or (ii) seeking
appointment of a receiver, trustee, custodian or other similar official for
it or for all or any substantial part of its assets, or the Parent, the
Company or any of its Subsidiaries shall make a general assignment for the
benefit of its creditors; or (2) there shall be commenced against the
Parent, the Company or any of its Subsidiaries any case, proceeding or
other action of a nature referred to in clause (1) above which (i) results
in the entry of an order for relief or any such adjudication or
appointment, or (ii) remains undismissed, undischarged or unbonded for a
period of sixty (60) days; or (3) there shall be commenced against the
Parent, the Company or any of its Subsidiaries any case, proceeding or
other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its
assets which results in the entry of an order for any such relief which
shall not have been vacated, discharged, or stayed or bonded pending appeal
within sixty (60) days from the entry thereof; or (4) the Parent, the
Company or any of its Subsidiaries shall take any action in furtherance of,
or indicating its consent to, approval of, or acquiescence in, any of the
acts set forth in clause (1), (2) or (3) above; or (5) the Parent, the
Company or any of its Subsidiaries shall generally not, or shall be unable
to, or shall admit in writing its inability to, pay its debts as they
become due; or
11(h)(1) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the
Code) involving any Plan, (2) any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or nor waived, shall exist with
respect to any Plan, (3) a Reportable Event shall occur with respect to, or
proceedings shall commence to have a trustee appointed, or a trustee shall
be appointed, to administer or to terminate, any Single Employer Plan,
which Reportable Event or institution of proceedings is, in the reasonable
opinion of the Lead Administrative Agent, likely to result in the
termination of such Plan for purposes of Title IV of ERISA, and, in the
case of a Reportable Event, the continuance of such Reportable Event
unremedied for ten days after notice of such Reportable Event pursuant to
Section 4043(a), (c) or (d) of ERISA is given or the continuance of such
proceedings for ten days after commencement thereof, as the case may be,
(4) any Single Employer Plan shall terminate for purposes of Title IV of
ERISA, (5) any withdrawal liability to a Multiemployer Plan shall be
incurred by the Company or the Parent or any Commonly Controlled Entity, or
(6) any other event or condition shall occur or exist; and in each case in
clauses (1) through (6) above, such event or condition, together with all
other such events or conditions, if any, could subject the Parent, the
Company or any of its Subsidiaries to any tax, penalty or other liabilities
in the aggregate material in relation to the business, operations, property
or financial or other condition of the Parent, the Company or any of its
Subsidiaries; or
11(i)One or more judgments or decrees in amounts
aggregating $1,000,000.00 or more not fully covered by insurance (exclusive
of self-insurance (not to exceed $5,000,000.00) and deductibles) during any
consecutive twelve (12) month period shall be entered against the Company
or any of its Subsidiaries and all such judgments or decrees shall not have
been vacated, discharged or satisfied, or stayed or bonded pending appeal,
within sixty (60) days from the entry thereof unless counsel to the Company
reasonably acceptable to the Majority Lenders has delivered to the Lenders
within such sixty (60) day period an opinion that the Company has the legal
right to have such judgment or decree vacated without the expenditure of
funds (other than for costs of proceedings) and the Company is diligently
proceeding to accomplish such vacation; or
11(j)The Parent shall notify the Lead Administrative
Agent or any Lender of its intention to rescind or revoke the Guaranty or
the Subordination Agreement, in whole or in part, with respect to future
transactions or otherwise; or
11(k)The Parent shall cease to own one hundred
percent (100%) of the outstanding capital stock of the Company;
THEN:
(1) Automatically upon the occurrence of an Event of Default under
Paragraph 11(g) above,
(2) At the option of any Lender upon the occurrence of an Event of Default
under Paragraph 11(a) above unless such Event of Default is expressly
waived in writing by one hundred percent (100%) of the Lenders, and
(3) In all other cases, at the option of the Majority Lenders,
each Lender's obligation to make Loans shall terminate and the principal balance
of outstanding Loans and interest accrued but unpaid thereon and all other
Obligations shall become immediately due and payable, without demand upon or
notice or presentment to the Company, all of which are hereby waived.
12. Agency Provisions.
-----------------
12(a)Appointment. Each Lender hereby irrevocably designates and appoints
each Agent as the agent of such
-----------
Lender under the Credit Documents and each Lender hereby irrevocably authorizes
each Agent, as the agent for such Lender, to take such action on its behalf
under the provisions of the Credit Documents and to exercise such powers and
perform such duties as are expressly delegated to such Agent by the terms of the
Credit Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in the Credit
Documents, no Agent shall have any duties or responsibilities, except those
expressly set forth therein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into the Credit Documents or otherwise exist against
any Agent.
12(b)Delegation of Duties. The Lead Administrative Agent may execute any of
its duties under the Credit
--------------------
Documents by or through agents or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. The Lead
Administrative Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care.
12(c)Exculpatory Provisions. No Agent nor any of its respective officers,
directors, employees, agents,
----------------------
counsel, attorneys-in-fact or Affiliates shall be (1) liable to any Lender, any
other Agent, the holder of any CPN or the Company for any action taken or
omitted to be taken by it or such Person under or in connection with the Credit
Documents (except for its or such Person's own gross negligence or willful
misconduct), or (2) responsible in any manner to any of the Lenders, any other
Agent, the holder of any CPN or the Company for: (i) any recitals, statements,
representations or warranties made by the Company or any officer thereof
contained in the Credit Documents or in any certificate, report, statement or
other document referred to or provided for in, or received by such Agent under
or in connection with, the Credit Documents (except such as are prepared by such
Agent and, then, only to the extent such Agent is responsible for verification
of the accuracy and completeness of the information contained therein or the
facts upon which such information is based as expressly provided herein) or for
the value, validity, effectiveness, genuineness, enforceability, collectability
or sufficiency of the Credit Documents or for any failure of the Company to
perform its obligations thereunder or (ii) assuring compliance of the Credit
Documents and/or the transactions contemplated by the Credit Documents with any
law or regulation binding upon such Person, it being expressly acknowledged,
agreed and understood that each such Person has obtained independent advice
satisfactory to it in all such regards. No Agent shall be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, the Credit Documents
(other than agreements required to be complied with by such Agent thereunder and
subject to the standards of care set forth herein with respect thereto) or to
inspect the properties, books or records of the Company. Each Agent shall be
entitled to refrain from exercising any discretionary powers or actions under
this Agreement or any other Credit Document until it shall have received the
prior written consent of one hundred percent (100%) of the Lenders to such
action.
12(d)Reliance by Agent. Each Agent shall be entitled to rely, and shall be
fully protected in relying,
-----------------
upon any note, writing, resolution, notice, consent, certification, affidavit,
letter, cablegram, telegram, telecopy, telex or teletype message, statement,
order or other document or conversation reasonably believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to the Company), independent accountants and other experts
selected by such Agent. The Lead Administrative Agent may deem and treat each
Lender designated on the current Commitment Schedule as a Lender hereunder for
all purposes of the Credit Documents unless a written notice of assignment,
negotiation or transfer of such Lender's interests hereunder and thereunder as
permitted pursuant to Paragraph 14 below shall have been filed with the Lead
Administrative Agent. Each Agent shall be fully justified in failing or refusing
to take any action under the Credit Documents unless it shall first receive such
advice or concurrence of the Majority Lenders (or all Lenders, as required under
the Credit Documents) or it shall first be indemnified to its satisfaction by
the Lenders against any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any action (other than liability
and/or expense arising out of such Agent's gross negligence or willful
misconduct). Each Agent shall in all cases be fully protected in acting, or in
refraining from acting, under the Credit Documents in accordance with a request
of the Majority Lenders (or all Lenders, if applicable) absent gross negligence
and willful misconduct on the part of such Agent in the method in which it acts
or refrains from acting in accordance therewith, and such request and any action
taken or failure to act pursuant thereto shall be binding upon all the Lenders.
12(e)Notice of Default; Agreement to Advance. No Agent shall be deemed to
have knowledge or notice of the
---------------------------------------
occurrence of any Event of Default or Potential Default unless such Agent has
received notice from a Lender or the Company referring to the Credit Documents,
describing such Event of Default or Potential Default and stating that such
notice is a "notice of default". In the event that any Agent receives such a
notice, such Agent shall give notice thereof to the Lenders and the other
Agents.
12(f)Non-Reliance on Agent and Other Lenders. Each Lender expressly
acknowledges that no Agent nor any of
---------------------------------------
its respective officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by
such Agent hereafter taken, including any review of the affairs of the Company,
shall be deemed to constitute any representation or warranty by such Agent to
any Lender. Each Lender represents to each Agent that it has, independently and
without reliance upon such Agent or any other Lender or their respective
counsel, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the
Company and made its own decision to extend credit hereunder and enter into this
Agreement. Each Lender also represents that it will, independently and without
reliance upon any Agent or any other Lender or their respective counsel, and
based on such documents, information and legal advice (including, without
limitation, advice of regulatory counsel to it) as it shall deem appropriate at
the time, continue to make its own credit analysis, appraisals and decisions in
entering into the Credit Documents and taking or not taking action thereunder,
and to make such investigation as it deems necessary to inform itself as to the
business, operations, property, financial and other condition and
creditworthiness of the Company. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by an Agent hereunder, such
Agent shall not have any duty or responsibility to provide any Lender with any
legal advice or credit or other information concerning the business, operations,
property, financial and other condition or creditworthiness of the Company which
may come into the possession of such Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
12(g)Indemnification. The Company agrees to indemnify, defend and hold
harmless each Agent in its capacity
---------------
as such from and against any and all claims, obligations, penalties, actions,
suits, judgments, costs, disbursements, losses, liabilities and/or damages
(including, without limitation, attorneys' fees) of any kind whatsoever which
may at any time be imposed on, assessed against or incurred by such Agent in any
way (1) relating to or arising out of the Credit Documents or any documents
contemplated by or referred to therein or the transactions contemplated thereby
or any action taken or omitted to be taken by such Agent in connection with the
foregoing; provided, the Company shall not be liable for any portion of any such
claims, obligations, etc., arising out of or resulting from the gross negligence
or willful misconduct of such Agent or (2) resulting from any action taken or
omitted to be taken by such Agent in accordance with written instructions given
as provided in the Credit Documents or (3) relating to any one or more of the
matters covered by Paragraph 12(c) above. The Lenders agree to indemnify and
hold harmless each Agent in its capacity as such ratably in accordance with
their Primary Percentage Shares to the extent required by the Company hereunder
if any Agent is not reimbursed by the Company hereunder and without limiting the
obligation of the Company to do so. To the extent indemnification payments made
by the Lenders pursuant to this Paragraph 12(g) are subsequently recovered by
any Agent from, or for the account of, the Company, such Agent will promptly
refund such previously paid indemnity payments to the Lenders. The
indemnification obligations of the Company and Lenders under this Paragraph
12(g) shall survive termination of this Agreement and payment in full of the
Obligations.
12(h)Agent in Its Individual Capacity. Any Agent and its Affiliates may
make loans to, accept deposits
--------------------------------
from and generally engage in any kind of business with the Company as though
such Agent were not an Agent hereunder. With respect to such loans made or
renewed by them and any note issued to them hereunder, each Agent shall have the
same rights and powers under the Credit Documents as any Lender thereunder and
may exercise the same as though it were not an Agent, and the terms "Lender" and
"Lenders" shall include Agents in their individual capacities.
12(i)Successor Agents. Any Agent may resign as such under the Credit
Documents upon ninety (90) days'
----------------
prior written notice to the Lenders and the Company and the Lead Administrative
Agent shall resign in the event its Maximum Commitment shall be less than
$25,000,000.00. In addition, in the event any Agent fails to perform its
obligations under the Credit Documents in any material manner and fails to
correct its performance within thirty (30) days of written notice of such
failure of performance given by not less than the Majority Lenders, then such
Agent may be removed upon thirty (30) days notice given by not less than the
Majority Lenders. If an Agent shall resign or be so removed, then, on or before
the effective date of such resignation or removal, the Majority Lenders shall
appoint a successor agent reasonably acceptable to the Company or, if the
Majority Lenders are unable to agree on the appointment of a successor agent,
such Agent shall appoint a successor agent for the Lenders, which successor
agent shall be reasonably acceptable to the Company, whereupon such successor
agent shall succeed to the rights, powers and duties of such Agent, and the term
"Documentation Agent," "Syndication Agent," "Lead Administrative Agent,"
"Co-Administrative Agent," "Arranger", "Co-Arranger" or "Co-Agents," as
applicable, shall mean such successor agent effective upon its appointment, and
the former Agent's rights, powers and duties shall be terminated without any
other or further act or deed on the part of such former Agent or any of the
parties to this Agreement or any of the other Credit Documents or successors
thereto. After any Agent's resignation or removal hereunder, the provisions of
this Paragraph 12 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Agent under the Credit Documents.
12(j)Sharing of Set-Offs. If following the occurrence and during the
continuance of an Event of Default
-------------------
any Lender (a "benefitted Lender") shall at any time receive any payment of all
or part of the Obligations held by it or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off or otherwise) in a
greater proportion than any such payment to and collateral received by any other
Lender, if any, in respect of such other Lender's portion of the Obligations, or
interest thereon, such benefitted Lender shall purchase for cash from the other
Lenders such portion of each such other Lender's Obligations, or shall provide
such other Lenders with the benefits of such collateral, or the proceeds
thereof, as shall be necessary to cause such benefitted Lender to share the
excess payment or benefits of such collateral or proceeds ratably with each of
the Lenders; provided, however, that if all or any portion of such excess
payment or benefits is thereafter recovered from such benefitted Lender, such
purchase shall be rescinded, and the purchase price and benefits returned, to
the extent of such recovery but without interest. The Company agrees that each
Lender so purchasing a portion of another Lender's Obligations may exercise all
rights of payment (including, without limitation, rights of set-off) with
respect to such portion as fully as if such Lender were the direct holder of
such portion.
13. Miscellaneous Provisions.
------------------------
13(a)No Assignment. The Company may not assign its rights or obligations
under the Credit Documents
-------------
without the prior written consent of one hundred percent (100%) of the Lenders.
Subject to the foregoing, all provisions contained in this Agreement or any
document or agreement referred to herein or relating hereto shall inure to the
benefit of each Lender, its successors and assigns, and shall be binding upon
the Company, its successors and assigns.
13(b)Amendment. The Credit Documents may not be amended or terms or
provisions hereof waived unless such
---------
amendment or waiver is in writing and signed by the Majority Lenders and the
Company; provided, however, that without the prior written consent of one
hundred percent (100%) of the Lenders, no amendment or waiver shall:
(1) Waive or amend any term or provision of Paragraph 4(e), 4(f) or 4(g)
above, or this
Paragraph 13(b);
(2) Reduce the principal of, or interest on, the Obligations or any amount
of fees payable under this Agreement or extend the required payment date of
principal or interest on the Obligations or any fees;
(3) Increase the Aggregate Credit Limit above $2,000,000,000.00;
(4) Modify any Lender's Primary Percentage Share or Swing Line Percentage
Share except modifications resulting from an increase, permanent or
temporary, in a Lender's Maximum Commitment or Swing Line Commitment made
as permitted under this Agreement;
(5) Modify the definition of "Majority Lenders";
(6) Include any Person other than the Lenders signatory hereto as a
"Lender" hereunder except as expressly permitted pursuant to Paragraph
14(a) below;
(7) Cancel or terminate the Guaranty or permit the revocation of the
Subordination Agreement;
or
(8) Extend the Revolving Facility Maturity Date or the Final Maturity Date;
provided, however, that nothing contained herein shall in any manner or to any
extent be deemed to supersede any provision of the Credit Documents which
expressly designates which Lenders are empowered to modify such provision,
including, without limitation, any provision of the Credit Documents which
expressly requires the consent of one hundred percent (100%) of the Lenders to
any modification thereof. No amendment or waiver shall, unless agreed to in
writing by the affected Agent, modify the rights or duties of such Agent. The
Lead Administrative Agent shall provide notice and a copy of all amendments to
the Credit Documents to all parties to the Credit Documents.
13(c)Cumulative Rights; No Waiver. The rights, powers and remedies of the
Lenders hereunder are cumulative
----------------------------
and in addition to all rights, powers and remedies provided under any and all
agreements between the Company and the Lenders relating hereto, at law, in
equity or otherwise. Any delay or failure by the Lenders to exercise any right,
power or remedy shall not constitute a waiver thereof by the Lenders, and no
single or partial exercise by the Lenders of any right, power or remedy shall
preclude any other or further exercise thereof or any exercise of any other
rights, powers or remedies.
13(d)Entire Agreement; Severability. This Agreement and the documents and
agreements referred to herein
------------------------------
embody the entire agreement and understanding between the parties hereto and
supersede all prior agreements and understandings relating to the subject matter
hereof and thereof. All waivers by the Company provided for in the Credit
Documents have been specifically negotiated by the parties with full cognizance
and understanding of their rights. If any of the provisions of the Credit
Documents shall be held invalid or unenforceable, the Credit Documents shall be
construed as if not containing such provisions, and the rights and obligations
of the parties hereto shall be construed and enforced accordingly.
13(e)Survival. All representations, warranties, covenants and agreements
herein contained on the part of
--------
the Company shall survive the termination of this Agreement and shall be
effective until the Obligations are paid and performed in full or longer as
expressly provided herein.
13(f)Notices. All notices given by any party to any of the others
shall be in writing (which may be by
-------
facsimile transmission), delivered personally, by commercial courier service or
by depositing the same in the United States mail, registered, with postage
prepaid, addressed to such party at the address set forth on Annex II attached
hereto. Any party may change the address to which notices are to be sent by
notice of such change to the other party or parties given as provided herein.
13(g)Governing Law. This Agreement shall be deemed to be a contract
made under the laws of the State of
-------------
California, and for all purposes shall be construed in accordance with the laws
of said State, without regard to principles of conflicts of law.
13(h)Counterparts. This Agreement may be executed in counterparts each
of which when so executed shall be
------------
deemed to be an original and all of which when taken together shall constitute
one and the same agreement.
13(i)Waiver of Jury Trial. EACH OF THE PARTIES HERETO WAIVES ITS
RESPECTIVE RIGHTS TO A TRIAL BY JURY OF
--------------------
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY
OF THE PARTIES AGAINST ANY OTHER PARTY, WHETHER WITH RESPECT TO CONTRACT CLAIMS,
TORT CLAIMS, OR OTHERWISE. EACH OF THE PARTIES HERETO AGREES THAT ANY SUCH CLAIM
OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO
A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS PARAGRAPH 13(i) AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR
ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE
OTHER CREDIT DOCUMENTS.
14. Additional Lenders; Assignments and Participations; Increases in
Availability.
--------------------------------------------------------------------
14(a)Addition of New Lender.
----------------------
(1) Subject to the limitation on the Aggregate Credit Limit set forth
in the definition of such term, the Company or any Lender may at any
time propose that one or more Eligible Assignees (each, an "Applicant
Financial Institution") become an additional Lender hereunder. At such
time, the Company or such Lender, as applicable, shall notify the
other parties hereto, including the Lead Administrative Agent, of the
identity of such Applicant Financial Institution and such Applicant
Financial Institution's proposed Maximum Commitment and, as
applicable, Swing Line Commitment. The addition of any Applicant
Financial Institution shall be subject to:
(i) If such Applicant Financial Institution is proposed for inclusion
as a Lender hereunder by a Lender, the prior written consent of the
Company and the Lead Administrative Agent, and if such Applicant
Financial Institution is proposed for inclusion as a Lender hereunder
by the Company, the prior written consent of the Lead Administrative
Agent, none of which consents shall be unreasonably withheld and
which, if given, shall be given in writing to the other parties hereto
no later than the tenth day following receipt by the Company of a
written request for the inclusion of such Applicant Financial
Institution as a Lender hereunder; and
(ii) Delivery of each of the items and the occurrence of each of the
events described in subparagraph (2) below.
(2) Assuming delivery of the consent of the Company and/or Lead
Administrative Agent as required pursuant to subparagraph (1)(i)
above, the Lead Administrative Agent, the Company and, if such
Applicant Financial Institution will be acquiring a portion of an
existing Lender's Maximum Commitment by way of assignment from such
existing Lender, such existing Lender, shall mutually agree on the
Adjustment Date on which such Applicant Financial Institution shall
become a party hereto and a Lender hereunder. On such Adjustment Date:
(i) The Lead Administrative Agent shall deliver to the Company and
each of the Lenders a Commitment Schedule to be effective as of such
Adjustment Date, reflecting the inclusion of such Applicant Financial
Institution as a party hereto and a Lender hereunder.
(ii) No later than 12:30 p.m. (Los Angeles time) on such Adjustment
Date, such Applicant Financial Institution shall pay to the Lead
Administrative Agent an amount equal to such Applicant Financial
Institution's Primary Percentage Share of Primary Loans outstanding
and, as applicable, Swing Line Percentage Share of Swing Loans
outstanding. If such Applicant Financial Institution is becoming a
Lender hereunder as a result of an increase in the Aggregate Credit
Limit, the Lead Administrative Agent shall thereupon remit to the
Lenders, as applicable, their shares of such funds. If such Applicant
Financial Institution is acquiring a portion of an existing Lender's
outstanding Primary Loans, the Lead Administrative Agent shall
thereupon remit such funds to the assigning Lender. Following such
Adjustment Date, fees and interest accrued on the Obligations to but
not including such Adjustment Date shall be payable to the Lenders in
accordance with their respective Primary Percentage Shares and Swing
Line Percentage Shares prior to such Adjustment Date before giving
effect to the readjustment thereof pursuant to the Commitment Schedule
provided by the Company on such Adjustment Date.
(iii) If such Applicant Financial Institution is acquiring a portion
of an existing Lender's Maximum Commitment by way of assignment from
such existing Lender, the Lead Administrative Agent, the Company, the
assigning Lender and the Applicant Financial Institution shall execute
and deliver an Assignment Agreement, or if such Applicant Financial
Institution is becoming a Lender hereunder as a result of an increase
in the Aggregate Credit Limit, the Lead Administrative Agent, the
Company and the Applicant Financial Institution shall execute and
deliver an Additional Lender Agreement, either of which Assignment
Agreement or Additional Lender Agreement shall constitute an amendment
to this Agreement to the extent necessary to reflect the inclusion of
the Applicant Financial Institution as a Lender hereunder.
(iv) The Applicant Financial Institution shall pay to the Lead
Administrative Agent a registration fee of $3,500.00.
Subject to the requirements described above, the Applicant Financial Institution
shall become a party hereto and a Lender hereunder and shall be entitled to all
rights, benefits and privileges accorded a Lender under the Credit Documents and
shall be subject to all obligations of a Lender under the Credit Documents.
14(b)Assignments Among Existing Lenders. Any Lender may at any time
agree to assign a portion of such
----------------------------------
Lender's Maximum Commitment to a Transferee Lender. In such event the Lender and
the Transferee Lender shall so notify the Lead Administrative Agent and the
Company of the Adjustment Date on which such assignment is to be effective. On
such Adjustment Date:
(1) The Company shall deliver to the Lead Administrative Agent and
each of the Lenders a Commitment Schedule to be effective as of such
Adjustment Date reflecting the assignment.
(2) The Lead Administrative Agent, the Company, the assigning Lender
and the Transferee Lender shall execute and deliver an Assignment
Agreement, which shall constitute an amendment to this Agreement to
the extent necessary to reflect such transfer.
(3) No later than 12:30 p.m. (Los Angeles time) on such Adjustment
Date, the Transferee Lender shall pay to the Lead Administrative Agent
an amount equal to, as applicable, such Transferee Lender's Primary
Percentage Share of Primary Loans and Swing Line Percentage Share of
Swing Loans outstanding in excess of such Transferee Lender's previous
Primary Percentage Share and, as applicable, Swing Line Percentage
Share thereof. The Lead Administrative Agent shall thereupon remit to
the transferring Lender the amount thereof.
14(c)Minimum Loan Commitment. Notwithstanding anything to the contrary
contained herein, the inclusion of
-----------------------
any Applicant Financial Institution as a Lender hereunder pursuant to Paragraph
14(a) above and the assignment by a Lender of a portion of such Lender's Maximum
Commitment to a Transferee Lender pursuant to Paragraph 14(b) above shall be
subject to the following restrictions:
(1) If an Applicant Financial Institution is acquiring a portion of an
existing Lender's Maximum Commitment by way of an assignment from such
existing Lender, then: (i) such assignment of Maximum Commitment must
be in the minimum amount of $5,000,000.00 (or if in a higher amount,
in integral multiples of $5,000,000.00 in excess thereof), and (ii)
following the consummation of the contemplated assignment and after
giving effect to any other assignments occurring on the related
Adjustment Date, such existing Lender must continue to hold a Maximum
Commitment of not less than $25,000,000.00 and such Applicant
Financial Institution must hold a Maximum Commitment of not less than
$25,000,000.00;
(2) If an existing Lender is assigning a portion of its Maximum
Commitment to a Transferee Lender, such assignment of Maximum
Commitment is in the minimum amount of $5,000,000.00 (or if in a
higher amount, in integral multiples of $5,000,000.00 in excess
thereof) and such existing Lender shall continue to hold a Maximum
Commitment of not less than $25,000,000.00 following the consummation
of the contemplated assignment.
There shall be no minimum hold requirement in the event that an existing Lender
is assigning one hundred percent (100%) of its Maximum Commitment.
14(d)Sub-Participations by Lenders. Any Lender may at any time sell
participating interests in any of the
-----------------------------
Obligations held by such Lender and its commitments hereunder; provided,
however, that:
(1) No participation contemplated by this Paragraph 14(d) shall
relieve such Lender from its obligations hereunder or under any other
Credit Document;
(2) Such Lender shall remain solely responsible for the performance of
such obligations;
(3) The Company, the Lead Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under the Credit
Documents;
(4) The participation agreement between such Lender and the Person
purchasing such participation interest (a "Participant") shall provide
that: (i) the participation interest of the Participant is an
undivided interest in such Lender's Maximum Commitment, and (ii) the
sole voting rights of the Participant are with respect to those items
on which such Lender is entitled to vote pursuant to Paragraphs
13(b)(2) and 13(b)(7) above; and
(5) Such Lender shall not enter into participation agreements with
more than two Participants for each $25,000,000.00 of Maximum
Commitment held by such Lender.
The Company acknowledges and agrees that each Participant shall be considered a
Lender for purposes of Paragraphs 4(e), 4(f), 4(g) and 5(l) above; provided,
however, that in no event shall any Participant be entitled to receive any
payment or compensation in excess of that to which such Participant's selling
Lender would be entitled with respect to the participation interest held by such
Participant if such Lender had not sold any participation interest to such
Participant.
14(e)Federal Reserve Bank. Notwithstanding the provisions of
Paragraphs 14(a) and 14(b) above, any Lender
--------------------
may at any time pledge or assign all or any portion of such Lender's rights
under this Agreement and the other Credit Documents to a Federal Reserve Bank.
14(f)Increases in Availability. From time to time the Company and any
Lender (an "Increasing Lender") may
-------------------------
agree, with the prior written consent of the Lead Administrative Agent, to
permanently or temporarily increase such Lender's Maximum Commitment and Primary
Percentage Share, the dollar amount of any such increase to be, subject to the
Aggregate Credit Limit limitation, in the minimum dollar amount of $5,000,000.00
and integral multiples of $5,000,000.00 in excess thereof. The Company and the
Increasing Lender shall agree on the Adjustment Date for said increase and, if
the increase is a temporary rather than permanent increase, the date on which
said increase shall terminate (the "Temporary Increase Termination Date"). The
Lead Administrative Agent shall deliver to the Company and each of the Lenders a
Commitment Schedule to be effective as of such Adjustment Date. On the Temporary
Increase Termination Date the aggregate amount of such Increasing Lender's
Primary Percentage Share of outstanding Primary Loans in excess of its Maximum
Commitment after giving effect to the termination of the subject increase shall,
if but only if at such Temporary Increase Termination Date there does not exist
an Event of Default, be payable in full. If at the Temporary Increase
Termination Date there exists an Event of Default, the temporary increase of the
Increasing Lender shall continue in effect and, unless otherwise agreed by one
hundred percent (100%) of the Lenders, shall be treated thereafter as a
permanent increase in said Increasing Lender's Maximum Commitment.
14(g)Provision of Information; Confidentiality. The Company hereby
acknowledges and agrees that in
-----------------------------------------
connection with the proposed assignment or subparticipation by
a Lender of its interest in the Obligations, such Lender may disclose to
prospective assignees and Participants any and all information provided to such
Lender hereunder; provided, however, that such information shall be furnished to
such prospective assignees and Participants on a confidential basis.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the day and year first above written.
COUNTRYWIDE HOME LOANS, INC.,
a New York corporation
By
Name
Title
ROYAL BANK OF CANADA, as Lead
Administrative Agent, Arranger, a
Swing Line Lender and a Lender
By
Name
Title
ABN AMRO BANK, N.V., as
Co-Administrative Agent, a
Co-Arranger, a Co-Agent, a Swing
Line Lender and a Lender
By
Name
Title
CREDIT LYONNAIS NEW YORK BRANCH, as
Syndication Agent, a Co-Arranger, a
Co-Agent, a Swing Line Lender and a
Lender
By
Name
Title
COMMERZBANK AG, NEW YORK BRANCH, as
Documentation Agent, a Co-Arranger,
a Co-Agent, a Swing Line Lender and
a Lender
By
Name
Title
[INSERT SIGNATURE BLOCKS FOR OTHER
LENDERS]
ACKNOWLEDGED AND AGREED TO as of the day and year first above written:
COUNTRYWIDE CREDIT INDUSTRIES, INC.
By ___________________________________
Name ________________________________
Title _________________________________
<PAGE>
SCHEDULE OF EXHIBITS TO CREDIT AGREEMENT
EXHIBIT DOCUMENT
A Form of Officer's Certificate
B Litigation Schedule
C Schedule of Existing Subsidiaries
Annex I: Glossary
____ Attachments to Glossary:
-----------------------
Schedule I: Commitment Schedule as of the Effective Date
Exhibit A: Form of Additional Lender Agreement
Exhibit B: Form of Assignment Agreement
Exhibit C-1: Form of Covenant Compliance Certificate (Company)
Exhibit C-2: Form of Covenant Compliance Certificate (Parent)
Exhibit D: Form of Parent Guaranty
Exhibit E: Form of Parent Subordination Agreement
Annex II: Schedule of Notice Addresses
<PAGE>
la-364217
CREDIT AGREEMENT
By and Among
COUNTRYWIDE HOME LOANS, INC.
and
ROYAL BANK OF CANADA
as Lead Administrative Agent and Arranger
ABN AMRO BANK, N.V. ("ABN")
as Co-Administrative Agent
CREDIT LYONNAIS NEW YORK BRANCH ("CL")
as Syndication Agent
COMMERZBANK AG, NEW YORK BRANCY ("CA")
as Documentation Agent
ABN, CL and CA
as Co-Arrangers
and
THE LENDERS PARTY THERETO
April 12, 2000
<PAGE>
TABLE OF CONTENTS
Page
RECITALS.............................. ........................................1
AGREEMENT ........................... .........................................1
1. Credit Facilities.......... ..........................................1
1(a) Primary Facility. ...........................................2
1(b) Swing Loan Facility..........................................2
1(c) Term Loan Facility...........................................3
2. Requests for Loans; Funding..................................3
2(a) Requests for Loans...........................................3
2(b) Funding of Primary Loans and Swing Loans ....................4
2(c) Funding Method...............................................4
3. Payment of Principal; Prepayments............................4
3(a) Required Principal Payments..................................4
3(b) Prepayments..................................................4
4. Calculation and Payment of Interest; Related Provisions......5
4(a) Interest on Primary Loans and the Term Loan..................5
4(b) Interest on Swing Loans......................................6
4(c) Payment of Interest..........................................6
4(d) Inability to Determine Rate..................................6
4(e) Funding Indemnification......................................7
4(f) Illegality; Impracticality...................................7
4(g) Requirements of Law; Increased Costs.........................8
4(h) Taxes........................................................8
4(i) Buy-Down Provisions.........................................11
4(j) Obligation of Lenders to Mitigate; Replacement of Lenders...11
5. Miscellaneous Lending Provisions............................12
5(a) Use of Proceeds.............................................12
5(b) Assumption of Funding/Purchase..............................12
5(c) Evidence of Indebtedness....................................12
5(d) Interest and Fee Billing and Payment........................13
5(e) Nature and Place of Payments................................14
5(f) Post-Default Interest.......................................14
5(g) Computations................................................14
5(h) Disbursement of Payments Received...........................14
5(i) Fees........................................................15
5(j) Wire Transfers of Funds.....................................15
5(k) Reduction in Aggregate Credit Limit.........................16
5(l) Capital Requirements........................................16
5(m) Extension of Revolving Facility Maturity Date...............16
6. Guaranty; Subordination; Additional Documents...............18
6(a) Guaranty and Subordination Agreement........................18
6(b) Further Documents...........................................18
7. Conditions Precedent.........................................18
7(a) First Loan..................................................18
7(b) All Primary Loans and Swing Loans...........................20
7(c) Extension of Revolving Facility Maturity Date; Term Loan....20
8. Representations and Warranties of the Company...............21
8(a) Financial Condition.........................................21
8(b) Corporate Existence; Compliance with Law....................21
8(c) Corporate Power; Authorization; Enforceable.................22
8(d) No Legal Bar................................................22
8(e) No Material Litigation......................................22
8(f) Taxes.......................................................22
8(g) Investment Company Act......................................22
8(h) Subsidiaries................................................22
8(i) Federal Reserve Board Regulations...........................22
8(j) ERISA.......................................................23
8(k) Assets......................................................23
9. Affirmative Covenants........................................23
9(a) Financial Statements........................................23
9(b) Certificates; Reports; Other Information....................24
9(c) Payment of Indebtedness.....................................25
9(d) Maintenance of Existence and Properties.....................25
9(e) Inspection of Property; Books and Records;..................25
9(f) Notices.....................................................25
9(g) Expenses....................................................26
9(h) Credit Documents............................................26
9(i) Insurance...................................................26
9(j) CPN Program.................................................26
9(k) Hedging Program.............................................26
10. Negative Covenants..........................................26
10(a) Liens.......................................................26
10(b) Indebtedness................................................27
10(c) Consolidation and Merger....................................27
10(d) Acquisitions................................................27
10(e) Payment of Dividends........................................28
10(f) Purchase or Retirement of Stock.............................28
10(g) Investments; Advances; Receivables..........................28
10(h) Sale of Assets..............................................29
10(i) Minimum Net Worth...........................................29
10(j) Maximum Total Debt..........................................29
11. Events of Default..............................................30
12. Agency Provisions...........................................32
12(a) Appointment.................................................32
12(b) Delegation of Duties........................................32
12(c) Exculpatory Provisions......................................32
12(d) Reliance by Agent...........................................33
12(e) Notice of Default; Agreement to Advance.....................33
12(f) Non-Reliance on Agent and Other Lenders.....................33
12(g) Indemnification.............................................34
12(h) Agent in Its Individual Capacity............................34
12(i) Successor Agents............................................35
12(j) Sharing of Set-Offs.........................................35
13. Miscellaneous Provisions.......................................35
13(a) No Assignment...............................................36
13(b) Amendment...................................................36
13(c) Cumulative Rights; No Waiver................................37
13(d) Entire Agreement; Severability..............................37
13(e) Survival....................................................37
13(f) Notices.....................................................37
13(g) Governing Law...............................................37
13(h) Counterparts................................................37
13(i) Waiver of Jury Trial........................................37
14. Additional Lenders; Assignments and Participations;
Increases in Availability;....................................................37
14(a) Addition of New Lender......................................37
14(b) Assignments Among Existing Lenders..........................39
14(c) Minimum Loan Commitment.....................................40
14(d) Sub-Participations by Lenders...............................40
14(e) Federal Reserve Bank........................................41
14(f) Increases in Availability...................................42
14(g) Provision of Information; Confidentiality...................41