TABLE OF CONTENTS

 

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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01	Certain Defined Terms		1
Section 1.02	Computation of Time Periods		26
Section 1.03	Accounting Terms and Financial Determinations		26
Section 1.04	Terms Generally		26

 

ARTICLE II

 

AMOUNTS AND TERMS OF THE ADVANCES

 

Section 2.01	The Advances	26
Section 2.02	Making the Advances	26
Section 2.03	Repayment of the Advances	27
Section 2.04	Termination of Commitments	28
Section 2.05	Prepayments and Cash Collections	28
Section 2.06	Interest	31
Section 2.07	Fees	31
Section 2.08	Conversion of Advances	31
Section 2.09	Increased Costs, Etc.	32
Section 2.10	Payments and Computations	33
Section 2.11	Taxes	34
Section 2.12	Sharing of Payments, Etc.	37
Section 2.13	Use of Proceeds	37
Section 2.14	Defaulting Lenders	37
Section 2.15	Evidence of Debt	39
Section 2.16	Replacement of Certain Lenders	39
Section 2.17	Specified Repayment Right	40

 

ARTICLE III

 

CONDITIONS TO EFFECTIVENESS

 

Section 3.01	Conditions Precedent to the Closing Date and the Borrowing	40
Section 3.02	Determinations Under Section 3.01	43

 

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ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

 

Section 4.01

Representations and Warranties of the Loan Parties

43

 

ARTICLE V

 

COVENANTS OF THE LOAN PARTIES

 

Section 5.01	Affirmative Covenants	47
Section 5.02	Negative Covenants	51
Section 5.03	Reporting Requirements	59
Section 5.04	Financial Covenants	63

 

ARTICLE VI

 

EVENTS OF DEFAULT

 

Section 6.01

Events of Default

63

 

ARTICLE VII

 

THE AGENTS

 

Section 7.01	Appointment and Authorization of the Agents	66
Section 7.02	Delegation of Duties	66
Section 7.03	Liability of Agents	67
Section 7.04	Reliance by Agents	68
Section 7.05	Notice of Default	68
Section 7.06	Credit Decision; Disclosure of Information by Agents	69
Section 7.07	Indemnification of Agents	69
Section 7.08	Agents in Their Individual Capacity	70
Section 7.09	Successor Agent	71
Section 7.10	Administrative Agent May File Proofs of Claim	71
Section 7.11	Collateral and Guaranty Matters	72
Section 7.12	Other Agents; Arrangers and Managers	72

 

ARTICLE VIII

 

SUBSIDIARY GUARANTY

 

Section 8.01

Subsidiary Guaranty

73

 

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Section 8.02	Guaranty Absolute	73
Section 8.03	Waivers and Acknowledgments	74
Section 8.04	Subrogation	75
Section 8.05	Additional Guarantors	75
Section 8.06	Subordination	75
Section 8.07	Continuing Guarantee; Assignments	76
Section 8.08	No Reliance	76
Section 8.09	Debtor Relief Laws	76

 

ARTICLE IX

 

MISCELLANEOUS

 

Section 9.01	Amendments, Etc.	77
Section 9.02	Notices, Etc.	78
Section 9.03	No Waiver; Remedies	80
Section 9.04	Costs, Fees and Expenses	80
Section 9.05	Right of Set-off	81
Section 9.06	Binding Effect	82
Section 9.07	Successors and Assigns	82
Section 9.08	Execution in Counterparts; Integration	85
Section 9.09	Confidentiality; Press Releases, Related Matters and Treatment of Information	85
Section 9.10	Patriot Act Notice	87
Section 9.11	Jurisdiction, Etc.	87
Section 9.12	Governing Law	88
Section 9.13	No Fiduciary Duty	88
Section 9.14	Waiver of Jury Trial	88

 

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SCHEDULES

 

Schedule I	-	Commitments and Applicable Lending Offices
Schedule II	-	Affiliated Transactions
Schedule III	-	Agreements with Negative Pledge Clauses
Schedule 1.01(a)	-	Disclosed Matters
Schedule 1.01(b)	-	Surviving Debt
Schedule 1.01(c)	-	Permitted Foreign Banks
Schedule 1.01(d)	-	Excluded Mortgage Loan Assets
Schedule 4.01(j)	-	Disclosures
Schedule 4.01(n)	-	Environmental Matters
Schedule 4.01(w)	-	Mortgage Loan Assets
Schedule 5.01(l)	-	Hedging Program
Schedule 5.01(m)	-	Post-Closing Obligations
Schedule 5.02(a)	-	Existing Liens
Schedule 5.02(e)	-	Existing Investments

 

EXHIBITS

 

Exhibit A	-	Form of Note
Exhibit B	-	Form of Notice of Borrowing
Exhibit C	-	Form of Assignment and Acceptance
Exhibit D	-	Form of Security Agreement
Exhibit E	-	Form of Guaranty Supplement
Exhibit F	-	Form of Operating Expense Rationalization Plan
Exhibit G	-	Form of Thirteen-Week Forecast
Exhibit H	-	Form of Monthly Asset and Run Rate Operating Expense Report
Exhibit I	-	Form of Opinion of Simpson Thacher & Bartlett LLP, counsel to the Loan Parties
Exhibit J	-	Form of Amendment to Existing Credit Agreement
Exhibit K	-	Form of Amendment to Existing Bridge Loan Agreement
Exhibit L	-	Form of Mortgage Loan Asset Summary
Exhibit M	-	Form of Three-Year Business Plan

 

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TERM FACILITY CREDIT AND GUARANTY AGREEMENT

 

TERM FACILITY CREDIT AND GUARANTY AGREEMENT (this “ Agreement ”) dated as of May 29, 2009 among CAPMARK FINANCIAL GROUP INC., a Nevada corporation (the “ Borrower ”), and each of the direct and indirect subsidiaries of the Borrower signatory hereto (each, a “ Guarantor ”, and, collectively, together with any person that becomes a Guarantor hereunder pursuant to Section 8.05, the “ Guarantors ”), the Initial Lenders (as hereinafter defined) and the other banks, financial institutions and other institutional lenders party hereto (each, a “ Lender ”, and collectively with the Initial Lenders and any other person that becomes a Lender hereunder pursuant to Section 9.07, the “ Lenders ”), CITICORP NORTH AMERICA, INC. (“ CNAI ”), as administrative agent (or any successor appointed pursuant to Article VII, the “ Administrative Agent ”) for the Lenders and the other Secured Parties (each as hereinafter defined), CITIBANK, N.A. (“ Citibank ”), as collateral agent (or any successor appointed pursuant to Article VII, the “ Collateral Agent ”) for the Lenders and the other Secured Parties, CITIGROUP GLOBAL MARKETS INC. (“ CGMI ”) and J.P. MORGAN SECURITIES, INC. (“ JPMSI ”), as joint lead arrangers and joint bookrunners (the “ Lead Arrangers ”) and JPMORGAN CHASE BANK, N.A., as syndication agent (the “ Syndication Agent ”).

 

PRELIMINARY STATEMENTS

 

(1)           The Borrower and its Subsidiaries intend to refinance certain Debt under the Existing Credit Agreement and the Existing Bridge Loan Agreement and to pay transaction fees and expenses in connection therewith, through the entering into of the Term Facility described herein.

 

(2)           In furtherance of the foregoing, the Borrower has requested that the Lenders provide a term credit facility, and the Lenders have indicated their willingness to lend on the terms and subject to the conditions set forth herein.

 

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements contained herein, the parties hereto hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS AND ACCOUNTING TERMS

 

Section 1.01           Certain Defined Terms .  As used in this Agreement, the following terms shall have the following meanings:

 

“ 2010 Notes ” means the Borrower’s Floating Rate Senior Notes due 2010.

 

“ 2012 Notes ” means the Borrower’s 5.875% Senior Notes due 2012.

 

“ 2017 Notes ” means the Borrower’s 6.300% Senior Notes due 2017.

 

“ Activities ” has the meaning specified in Section 7.08.

 

“ Administrative Agent ” has the meaning specified in the recital of parties to this Agreement.

 

 

“ Administrative Agent’s Account ” means the account of the Administrative Agent maintained by the Administrative Agent with Citibank, N.A. and identified to the Borrower and the Lenders from time to time.

 

“ Advance ” has the meaning specified in Section 2.01.

 

“ Affiliate ” means, as to any Person, any other Person that, directly or indirectly, controls, is controlled by or is under common control with such Person.  For purposes of this definition, the term “control” (including the terms “controlling”, “controlled by” and “under common control with”) of a Person means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of Voting Stock, by contract or otherwise.

 

“ Agent Parties ” has the meaning specified in Section 9.02(c).

 

“ Agent-Related Persons ” means, the Agents, together with their respective Affiliates, and the officers, directors, employees, agents and attorneys-in-fact of such Agents and Affiliates.

 

“ Agents ” means the Administrative Agent, the Collateral Agent, the Syndication Agent, the Lead Arrangers and, for purposes of Article VII, each member of the Lender Committee.

 

“ Agents Group ” has the meaning specified in Section 7.08.

 

“ Agreement Value ” means, for each Hedge Agreement, on any date of determination, an amount equal to:  (a) in the case of a Hedge Agreement documented pursuant to the Master Agreement (Multicurrency-Cross Border) published by the International Swap and Derivatives Association, Inc. (the “ Master Agreement ”), the amount, if any, that would be payable by any Loan Party or any of its Subsidiaries to its counterparty to such Hedge Agreement, as if (i) such Hedge Agreement was being terminated early on such date of determination and (ii) such Loan Party or Subsidiary was the sole “Affected Party,”; (b) in the case of a Hedge Agreement traded on an exchange, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss or gain on such Hedge Agreement to the Loan Party or Subsidiary of a Loan Party to such Hedge Agreement based on the settlement price of such Hedge Agreement on such date of determination; or (c) in all other cases, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss or gain on such Hedge Agreement to the Loan Party or Subsidiary of a Loan Party to such Hedge Agreement determined as the amount, if any, by which (i) the present value of the future cash flows to be paid by such Loan Party or Subsidiary exceeds or, as applicable, is less than (ii) the present value of the future cash flows to be received by such Loan Party or Subsidiary pursuant to such Hedge Agreement; capitalized terms used and not otherwise defined in this definition shall have the respective meanings set forth in the above described Master Agreement.  For the avoidance of doubt, the foregoing definition of “Agreement Value” does not affect the rights and obligations of any such Loan Party or such Subsidiary, on one hand, and such counterparty, on the other hand, under any such Hedge Agreement, including without limitation as to the calculation of any amount pursuant to section 6 of a Master Agreement as such section has been amended or supplemented by a schedule to such Master Agreement.

 

“ Applicable Adjustment Percentage ” means (a) for the first Fiscal Quarter ending after a Servicing Business Disposition, 95%, (b) for the second Fiscal Quarter ending after a Servicing Business Disposition, 90%, (c) for the third Fiscal Quarter ending after a Servicing Business Disposition, 85% and (d) for each Fiscal Quarter ending thereafter, 80%.

 

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“ Applicable Lending Office ” means, with respect to each Lender, such Lender’s Domestic Lending Office in the case of a Base Rate Advance and such Lender’s Eurodollar Lending Office in the case of a Eurodollar Rate Advance.

 

“ Applicable Margin ” means 2.50% per annum in the case of Eurodollar Rate Advances and 1.50% per annum in the case of Base Rate Advances.

 

“ Approved Fund ” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

 

“ Assignment and Acceptance ” means an assignment and acceptance entered into by a Lender and an Eligible Assignee, and accepted by the Administrative Agent, in accordance with Section 9.07 and in substantially the form of Exhibit C hereto.

 

“ Bankruptcy Remote Special Purpose Entity ” means (i) a Person that satisfies each of the following criteria:  (a) such Person is an entity that is consolidated for accounting purposes with the Borrower and designed to make remote the possibility that it would enter into bankruptcy or other receivership; (b) all or substantially all of such Person’s assets consist of Receivables or securities backed by Receivables plus any rights or other assets (including cash reserves) designed to assure the servicing or timely distribution of proceeds to the holders of its obligations; and (c) Receivables or securities backed by Receivables owned by such Person satisfy the legal isolation criteria set forth in paragraph 9(a) of Statement of Financial Accounting Standards No. 140 (“ FAS 140 ”) (in relation to the Borrower and any Subsidiary that is not a Bankruptcy Remote Special Purpose Entity) or (ii) any Subsidiary formed as a “successor borrower” in connection with any loan defeasance activities that satisfies the legal isolation requirements of FAS 140.

 

“ Base Rate ” means a fluctuating interest rate per annum in effect from time to time that for any day shall be equal to the highest of:

 

(a)           the rate of interest for such day announced publicly by Citibank, N.A., in New York, New York, as Citibank, N.A.’s base rate (which the Borrower acknowledges and agrees is announced by such bank and used by the Administrative Agent for reference purposes only and may not represent the lowest or best rate available to any of the customers of such bank or the Administrative Agent);

 

(b)           the Federal Funds Rate in effect on such day plus 0.5% per annum; and

 

(c)           the Eurodollar Rate for an Interest Period of one month beginning on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1.0%.

 

“ Base Rate Advance ” means an Advance that bears interest as provided in Section 2.06(a)(i).

 

“ Borrower ” has the meaning specified in the recital of parties to this Agreement.

 

“ Borrower’s Account ” means the account of the Borrower maintained by the Borrower and specified in writing to the Administrative Agent from time to time.

 

“ Borrowing ” means the borrowing of the Advances made by the Lenders to be made on the Closing Date.

 

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“ Business Day ” means a day of the year on which banks are not required or authorized by law to close in New York City and, if the applicable Business Day relates to any Eurodollar Rate Advances, on which dealings are carried on in the London interbank market.

 

“ Capital Expenditures ” means, for any Person for any period, the sum (without duplication) of all expenditures made, directly or indirectly, by such Person or any of its Subsidiaries during such period for equipment, fixed assets, real property or improvements, or for replacements or substitutions therefor or additions thereto, that have been or should be, in accordance with GAAP, reflected as additions to property, plant or equipment on a Consolidated balance sheet of such Person.  For purposes of this definition, the purchase price of equipment that is purchased simultaneously with the trade in of existing equipment or with insurance proceeds shall be included in Capital Expenditures only to the extent of the gross amount of such purchase price less the credit granted by the seller of such equipment for the equipment being traded in at such time or the amount of such proceeds, as the case may be.

 

“ Capitalized Leases ” means all leases that have been or should be, in accordance with GAAP, recorded as capitalized leases.

 

“ Cash Collateral Account ” means a blocked deposit account or joint deposit/securities account of the Borrower at Citibank, N.A. or an account in the name of the Collateral Agent, into which proceeds of the Collateral is to be deposited in accordance with Section 2.05(c), which such account shall be (a) under the sole dominion and control of the Collateral Agent (including the exclusive right of withdrawal), (b) subject to an agreement in form and substance reasonably satisfactory to the Collateral Agent, between the Borrower and the Collateral Agent, providing for the exclusive collection and control by the Collateral Agent of all deposits, balances and entitlements held in or credited to such account and (c) otherwise established in a manner reasonably satisfactory to the Collateral Agent.

 

“ Cash Equivalents ” means any of the following:

 

(a)           securities issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof and having maturities of not more than 12 months after the date of acquisition;

 

(b)           time deposits or certificates of deposit of (i) any bank of recognized standing having capital and surplus in excess of $5,000,000,000 or whose commercial paper rating is at least A-1 by S&P and P-1 by Moody’s and (ii) in the case of any Foreign Subsidiary of the Borrower, the banks listed on Schedule 1.01(c) or any other bank approved by the Administrative Agent in its sole discretion (it being understood that the Administrative Agent may revoke its approval of any such bank at any time for purposes of this clause (b), provided that any time deposits or certificates of deposits of such bank acquired by the Borrower or any of its Subsidiaries prior to such revocation shall continue to constitute Cash Equivalents for purposes of this Agreement), in each case having maturities of not more than six months after the date of acquisition;

 

(c)           commercial paper rated at least A-1 by S&P and P-1 by Moody’s and having maturities of not more than six months after the date of acquisition;

 

(d)           direct obligations (or certificates representing an ownership interest in such obligations) of any state of the United States (including any agency or instrumentality thereof) the long-term debt of which is rated A-3 or higher by Moody’s and A- or higher by S&P (or rated the equivalent by at least one nationally recognized statistical rating organization) and having maturities of not more than six months after the date of acquisition; and

 

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(e)           in the case of any Foreign Subsidiary of the Borrower, investments (i) in direct obligations of the sovereign nation (or any agency or instrumentality thereof) in which such Subsidiary is organized or is conducting a substantial amount of business or in obligations fully and unconditionally guaranteed by such sovereign nation (or agency or instrumentality) or (ii) of the type and maturity described in clause (a) through (d) above of foreign obligors, which investments or obligors (or their parents) have ratings equivalent to those described above (which may be equivalent ratings from foreign rating agencies).

 

“ CFC ” means any Foreign Subsidiary that is a “controlled foreign corporation” within the meaning of Internal Revenue Code section 957(a).

 

“ CGMI ” has the meaning specified in the recital of parties to this Agreement.

 

“ Change of Control ” means and shall be deemed to have occurred upon the occurrence of any of the following events:  (i) any Person or “group” (within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, and regulations promulgated thereunder), other than the Investors, shall have acquired beneficial ownership of more than 40% of the outstanding Equity Interests in the Borrower and (ii) after the date hereof, the occupation of a majority of the seats (other than vacant seats) on the board of directors of the Borrower by Persons who were neither (A) nominated by the board of directors of the Borrower nor (B) appointed by the directors so nominated.

 

“ Citibank ” has the meaning specified in the recital of parties to this Agreement.

 

“ Closing Date ” has the meaning specified in Section 3.01.

 

“ CNAI ” has the meaning specified in the recital of parties to this Agreement.

 

“ Collateral ” means all “Collateral” referred to in the Collateral Documents and all other property that is or is intended to be subject to any Lien in favor of the Collateral Agent for the benefit of the Secured Parties.

 

“ Collateral Agent ” has the meaning specified in the recital of parties to this Agreement.

 

“ Collateral Disposition ” means any sale, lease, transfer or other disposition of Collateral (including, for the avoidance of doubt, any REO Property) or series of related sales, leases, transfers or other dispositions of assets constituting Collateral (including, for the avoidance of doubt, REO Property) by the Borrower and its Subsidiaries.

 

“ Collateral Documents ” means, collectively, the Security Agreement, the Mortgages, any Security Agreement Supplements and Uncertificated Security Control Agreements (as each such term is defined in the Security Agreement) and any other agreement that creates or purports to create a Lien in favor of the Collateral Agent for the benefit of the Secured Parties.

 

“ Collateral Recovery Event ” means any settlement of or payment in respect of, or any casualty insurance claim or any condemnation proceeding relating to, any Collateral (including, for the avoidance of doubt, any REO Property), except as such settlement or payment is needed in the reasonable judgment of the Borrower and its Subsidiaries for repairs relating to any such Collateral that arose in connection with such event which caused the payment of such casualty insurance claim or condemnation proceeding and such settlement or payment is applied to such repairs within 180 days of such settlement or payment (or, to the extent so specified, such later date as may be permitted under the loan or investment documentation, if any, relating to such Collateral).

 

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“ Commitment ” means, with respect to any Lender at any time, the amount set forth for such time opposite such Lender’s name on Schedule I hereto under the caption “Commitment” or, if such Lender has entered into one or more Assignments and Acceptances, set forth for such Lender in the Register maintained by the Administrative Agent pursuant to Section 9.07(d) as such Lender’s “Commitment”, as such amount may be reduced at or prior to such time pursuant to Section 2.04.

 

For the avoidance of doubt, each Lender’s Commitment as of the date hereof shall be equal to the sum of (a) the product of (x) $937,500,000 multiplied by (y) a ratio the numerator of which is the sum of (A) the aggregate amount of the “Loans” (under and as defined in the Existing Credit Agreement) held by such Lender and (B) to the extent that such Lender holds a participation therein, issued and outstanding “Letters of Credit” (under and as defined in the Existing Credit Agreement) and the denominator of which is the sum of (A) the aggregate amount of the “Loans” (under and as defined in the Existing Credit Agreement) held by all of the Existing Credit Facility Lenders consenting to the amendments to the Existing Credit Agreement referred to in Section 3.01(b) and (B) the aggregate amount of all “Letters of Credit” (under and as defined in the Existing Credit Agreement) with respect to which Existing Credit Facility Lenders consenting to the amendments to the Existing Credit Agreement referred to in Section 3.01(b) hold participations therein ( provided that in the case of any such “Loans” or “Letters of Credit” denominated in a currency other than Dollars, the foregoing calculation shall be based on the Equivalent (under and as defined in the Existing Credit Agreement) of the principal amount or face amount, as the case may be, thereof as of a date reasonably near the Closing Date as determined by the Administrative Agent) plus (b) if such Lender holds any of the Existing Bridge Loans, the product of (x) $562,500,000 multiplied by (y) a ratio the numerator of which is the aggregate amount of the Existing Bridge Loans held by such Lender and the denominator of which is the aggregate amount of the Existing Bridge Loans held by all of the Existing Bridge Loan Lenders consenting to the amendments to the Existing Bridge Loan Agreement referred to in Section 3.01(b).

 

“ Communications ” has the meaning specified in Section 9.02(b).

 

“ Confidential Information ” means any and all material non-public information delivered or made available by any Loan Party or any Subsidiary of a Loan Party relating to any Loan Party or any Subsidiary thereof or their respective businesses, other than any such information that is or has been made available publicly by a Loan Party or any Subsidiary thereof.

 

“ Consolidated ” refers to the consolidation of accounts in accordance with GAAP.

 

“ Consolidating ” refers to the consolidating financial statements of the Borrower and its Subsidiaries which sets forth (i) the consolidated accounts of the Borrower and its Subsidiaries (other than any Specified Subsidiaries) and (ii) the consolidated accounts of each Specified Subsidiary and its Subsidiaries.

 

“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

 

“ Conversion ”, “ Convert ” and “ Converted ” each refers to the conversion of Advances from one Type to Advances of the other Type.

 

“ Debt ” means as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

 

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(a)           all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements, convertible securities (to the extent that such convertible securities are not evidenced by any of the foregoing and have put provisions or other similar obligations that are exercisable during the term of this Agreement) or other similar instruments;

 

(b)           all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments;

 

(c)           all obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable not overdue by more than 120 days incurred in the ordinary course of such Person’s business);

 

(d)           indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;

 

(e)           all obligations of such Person under Capitalized Leases;

 

(f)            all Synthetic Debt of such Person;

 

(g)           all obligations of such Person under Hedge Agreements, valued at the Agreement Value thereof;

 

(h)           all mandatory obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in cash in respect of any Equity Interests in such Person or any other Person or any warrants, rights or options to acquire such Equity Interests in each case on or prior to the Maturity Date, valued, in the case of Redeemable Preferred Interests, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends;

 

(i)            all Guarantee Obligations of such Person in respect of any of the foregoing; and

 

(j)            all indebtedness and other payment Obligations referred to in clauses (a) through (i) above of another Person secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any Lien on property (including, without limitation, accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such indebtedness or other payment Obligations.  The amount of any Debt related to this clause (j) shall be deemed to be equal to the lesser of (i) the amount of such Debt so secured and (ii) the fair market value of the property subject to such Lien.

 

Notwithstanding anything to the contrary herein and solely for purposes of Section 6.01(e), with respect to any Person (other than any Loan Party), any obligation that is non-recourse to such Person other than to specified assets of such Person, if in the reasonable judgment of the management of such Person the equity value of collateral that would be preserved or protected as a result of the repayment of such obligation is less than the amount necessary to repay such obligation, shall not be deemed Debt of such Person.

 

“ Debt For Borrowed Money ” means (a) all indebtedness of a Person of the type described in clauses (a) and (b) (other than direct or contingent obligations of such Person arising under surety bonds) of the definition of “Debt”, (b) all obligations of such Person in respect of other transactions

 

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entered into by such Person that are intended to function primarily as a borrowing of funds and (c) all Guarantee Obligations of such Person in respect of any of the foregoing.

 

“ Debtor Relief Laws ” means the U.S. Bankruptcy Code (11 U.S.C. §§ 101 et seq) and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

 

“ Default ” means any Event of Default or any event that would constitute an Event of Default but for the requirement that notice be given or time elapse or both.

 

“ Defaulted Amount ” means, with respect to any Lender at any time, any amount required to be paid by such Lender to the Administrative Agent or any other Lender hereunder or under any other Loan Document at or prior to such time which has not been so paid as of such time, including, without limitation, any amount required to be paid by such Lender to (a) any other Lender pursuant to Section 2.12 to purchase any participation in Advances owing to such other Lender and (b) the Administrative Agent pursuant to Section 7.07 to reimburse the Administrative Agent for such Lender’s ratable share of any amount required to be paid by the Lenders to the Administrative Agent as provided therein; provided that no such amount shall be a Defaulted Amount to the extent that such amount is being contested by such Lender in good faith by appropriate proceedings.  In the event that a portion of a Defaulted Amount shall be deemed paid pursuant to Section 2.14(a), the remaining portion of such Defaulted Amount shall be considered a Defaulted Amount originally required to be paid hereunder or under any other Loan Document on the same date as the Defaulted Amount so deemed paid in part.

 

“ Defaulting Lender ” means, at any time, any Lender that, at such time, owes a Defaulted Amount.

 

“ Disclosed Matters ” means the matters disclosed on Schedule 1.01(a).

 

“ Dollar ” means the lawful currency of the United States.

 

“ Domestic Lending Office ” means, with respect to any Lender, the office of such Lender specified as its “Domestic Lending Office” opposite its name on Schedule I hereto or in the Assignment and Acceptance pursuant to which it became a Lender, as the case may be, or such other office of such Lender as such Lender may from time to time specify to the Borrower and the Administrative Agent.

 

“ Eligible Assignee ” means:  (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; and (d) any other Person (other than an individual) approved by the Administrative Agent (such consent not to be unreasonably withheld or delayed); provided , however , that no Loan Party (or any Affiliate of a Loan Party) shall qualify as an Eligible Assignee under this definition.

 

“ Environmental Action ” means any action, suit, written demand, demand letter, written claim, written notice of noncompliance or violation, notice of liability or potential liability, investigation, proceeding, consent order or consent agreement relating in any way to any Environmental Law, any Environmental Permit, any Hazardous Material, or arising from alleged injury or threat to public or employee health or safety, as such relates to the actual or alleged exposure to Hazardous Material, or to the environment, including, without limitation, (a) by any governmental or regulatory authority for enforcement, cleanup, removal, response, remedial or other actions or damages and (b) by any governmental or regulatory authority or third party for damages, contribution, indemnification, cost recovery, compensation or injunctive relief.

 

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“ Environmental Law ” means any applicable federal, state, local or foreign statute, law, ordinance, rule, regulation, code, order, writ, judgment, injunction or decree, or judicial or agency interpretation, relating to pollution or protection of the environment, public or employee health or safety, as such relates to the actual or alleged exposure to Hazardous Material, or natural resources, including, without limitation, those relating to the use, handling, transportation, treatment, storage, disposal, release or discharge of Hazardous Materials.

 

“ Environmental Permit ” means any permit, approval, identification number, license or other authorization required under any Environmental Law.

 

“ Equity Interests ” means, with respect to any Person, shares of capital stock of (or other ownership or profit interests in) such Person, warrants, options or other rights for the purchase or other acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or other acquisition from such Person of such shares (or such other interests), and other ownership or profit interests in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are authorized on any date of determination.

 

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

 

“ ERISA Affiliate ” means any Person that for purposes of Title IV of ERISA is a member of the controlled group of any Loan Party, or under common control with any Loan Party, within the meaning of Section 414(b), (c), (m) or (o) of the Internal Revenue Code.

 

“ ERISA Event ” means (a) (i) the occurrence of a reportable event, within the meaning of Section 4043 of ERISA, with respect to any ERISA Plan unless the 30 day notice requirement with respect to such event has been waived by the PBGC or (ii) the requirements of subsection (1) of Section 4043(b) of ERISA (without regard to subsection (2) of such Section) are met with respect to a contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of an ERISA Plan, and an event described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur with respect to such ERISA Plan within the following 30 days; (b) the application for a minimum funding waiver with respect to an ERISA Plan; (c) the provision by the administrator of any ERISA Plan of a notice of intent to terminate such ERISA Plan, pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation of operations at a facility of any Loan Party or any ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA; (e) the withdrawal by any Loan Party or any ERISA Affiliate from a Multiple Employer Plan during a plan year for which it was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a lien under Section 303(k) of ERISA shall have been met with respect to any ERISA Plan; (g) the adoption of an amendment to an ERISA Plan requiring the provision of security to such ERISA Plan pursuant to Section 307 of ERISA; or (h) the institution by the PBGC of proceedings to terminate an ERISA Plan pursuant to Section 4042 of ERISA, or the occurrence of any event or condition described in Section 4042 of ERISA that constitutes grounds for the termination of, or the appointment of a trustee to administer, such ERISA Plan.

 

“ ERISA Plan ” means a Single Employer Plan or a Multiple Employer Plan.

 

“ Eurodollar Lending Office ” means, with respect to any Lender, the office of such Lender specified as its “Eurodollar Lending Office” opposite its name on Schedule I hereto or in the

 

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Assignment and Acceptance pursuant to which it became a Lender, as the case may be, or such other office of such Lender as such Lender may from time to time specify to the Borrower and the Administrative Agent.

 

“ Eurocurrency Liabilities ” has the meaning specified in Regulation D of the Board of Governors of the Federal Reserve System, as in effect from time to time.

 

“ Eurodollar Rate ” means, for any Interest Period, a rate per annum equal to the rate per annum obtained by dividing (X) the higher of (a) 1.50% per annum and (b) (i) the rate per annum equal to the British Bankers Association LIBOR Rate (“ BBA LIBOR ”), as published by Reuters (or another commercially available source providing quotations of BBA LIBOR as designated by the Administrative Agent from time to time) at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period, for U.S. dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or (ii) if the rate described in clause (i) is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which U.S. dollar deposits with a term equivalent to such Interest Period would be offered by Citibank, N.A. in London, England to major banks in the London or other offshore interbank market at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period by (Y) a percentage equal to 100% minus the Eurodollar Rate Reserve Percentage for such Interest Period.

 

“ Eurodollar Rate Advance ” means an Advance that bears interest as provided in Section 2.06(a)(ii).

 

“ Eurodollar Rate Reserve Percentage ” for any Interest Period for all Eurodollar Rate Advances means the reserve percentage applicable two Business Days before the first day of such Interest Period under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for a member bank of the Federal Reserve System in New York City with respect to liabilities or assets consisting of or including Eurocurrency Liabilities (or with respect to any other category of liabilities that includes deposits by reference to which the interest rate on Eurodollar Rate Advances is determined) having a term equal to such Interest Period.

 

“ Events of Default ” has the meaning specified in Section 6.01.

 

“ Excluded Mortgage Loan Assets ” has the meaning specified on Schedule 1.01(d).

 

“ Excluded Subsidiary ” means any Subsidiary of the Borrower that is: (a) not a wholly-owned Subsidiary; (b) not a Material Subsidiary; (c) a Foreign Subsidiary; (d) a Specified Subsidiary; (e) a Bankruptcy Remote Special Purpose Entity; (f) a CFC; (g) an entity that is prohibited by any Requirement of Law or Contractual Obligation from providing any guaranty of the Loan Parties’ Obligations under the Loan Documents; provided that any such Contractual Obligation (i) shall have been entered into or incurred prior to the Closing Date (or, in the case of any Subsidiary formed or acquired by the Borrower subsequent to the Closing Date, prior to such formation or acquisition) and (ii) in any event, shall not have been entered into or incurred in contemplation of this provision; or (h) any Subsidiary which is a broker-dealer registered with the SEC and applicable state securities commissions in the United States.

 

“ Excluded Taxes ” has the meaning specified in Section 2.11(a).

 

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“ Existing Bridge Loan Agreement ” means the $5,250,000,000 Bridge Loan Agreement, dated as of March 23, 2006, among the Borrower, the lenders party thereto, Citicorp North America Inc., as administrative agent, and the other financial institutions as agents party thereto.

 

“ Existing Bridge Loan Agreement Repayment ” means any ratable repayment or prepayment in cash of outstanding Existing Bridge Loans held by (a) Existing Bridge Loan Lenders that (i) enter into this Agreement as a Lender, (ii) consent to the amendments to the Existing Bridge Loan Agreement referred to in Section 3.01(b) and (iii) if such Existing Bridge Loan Lenders are also Existing Credit Facility Lenders, consent to the amendments to the Existing Credit Agreement referred to in Section 3.01(b) and (b) such Existing Bridge Loan Lenders’ permitted assigns.

 

“ Existing Bridge Loan Lender ” means any “Lender” under and as defined in the Existing Bridge Loan Agreement.

 

“ Existing Bridge Loans ” means any “Loans” under and as defined in the Existing Bridge Loan Agreement.

 

“ Existing Credit Agreement ” means the $5,500,000,000 Credit Agreement, dated as of March 23, 2006, among the Borrower, certain Subsidiaries of the Borrower as designated borrowers, the lenders party thereto, Citibank, N.A., as administrative agent, and the other financial institutions as agents party thereto.

 

“ Existing Credit Agreement Repayment ”  means any ratable repayment or prepayment of outstanding “Loans” under and as defined in the Existing Credit Agreement in cash (accompanied, in the case of any repaid Revolving Credit Loans, with a permanent reduction in the corresponding Revolving Credit Commitments (as such terms are defined in the Existing Credit Agreement)) held by (a) Existing Credit Facility Lenders that (i) enter into this Agreement as a Lender, (ii) consent to the amendments to the Existing Credit Agreement referred to in Section 3.01(b) and (iii) if such Existing Credit Facility Lenders are also Existing Bridge Loan Lenders, consent to the amendments to the Existing Bridge Loan Agreement referred to in Section 3.01(b) and (b) such Existing Credit Facility Lenders’ permitted assigns.

 

“ Existing Credit Facilities ” means the “Facilities” under and as defined in the Existing Credit Agreement.

 

“ Existing Credit Facility Lender ” means any “Lender” under and as defined in the Existing Credit Agreement.

 

“ Existing Indentures ” means, collectively (a) the Indenture, dated as of May 10, 2007, among the Borrower, the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, with respect to the 2010 Notes, (b) the Indenture, dated as of May 10, 2007, among the Borrower, the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, with respect to the 2012 Notes and (c) the Indenture, dated as of May 10, 2007, among the Borrower, the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, with respect to the 2017 Notes.

 

“ Existing Notes ” means the 2010 Notes, the 2012 Notes and/or the 2017 Notes, as the context may require.

 

“ Federal Funds Rate ” means, for any period, a fluctuating interest rate per annum equal for each day during such period to (a) the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published for such day (or, if such day is not a Business Day, for the preceding Business Day) by the

 

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Federal Reserve Bank of New York, or (b) if such rate is not so published for any day that is a Business Day, the average of the quotations at approximately 11:00 a.m., New York City time, for the day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.

 

“ Fee Letter ” means, collectively (a) the fee letter dated as of May 8, 2009 among the Borrower, the Lead Arrangers, Citibank, N.A. and JPMorgan Chase Bank, N.A. and (b) the administrative agent fee letter dated as of May 8, 2009 among the Borrower, CGMI, Citibank, N.A. and CNAI.

 

“ Fiscal Quarter ” means any fiscal quarter of any Fiscal Year, which quarter shall end on the last day of each March, June, September and December of such Fiscal Year in accordance with the fiscal accounting calendar of the Borrower and its Subsidiaries.

 

“ Fiscal Year ” means a fiscal year of the Borrower and its Subsidiaries ending on December 31, except for Subsidiaries of the Borrower organized in certain jurisdictions in Asia with fiscal years ending on March 31, April 30, June 30 or September 30.

 

“ Fitch ” means Fitch Inc.

 

“ Foreign Subsidiary ” means, at any time, any of the direct or indirect Subsidiaries of the Borrower that are organized outside of the laws of the United States, any state thereof or the District of Columbia at such time.

 

“ Fund ” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.

 

“ GAAP ” has the meaning specified in Section 1.03.

 

“ Government Related Enterprises ” means the collective reference to (a) the Federal Home Loan Mortgage Corporation (Freddie Mac), (b) the Federal National Mortgage Association (Fannie Mae) and (c) the United States Department of Housing and Urban Development, including the Government National Mortgage Association (Ginnie Mae).

 

“ Granting Lender ” has the meaning specified in Section 9.07(j).

 

“ Guarantee Obligation ” means, as to any Person, any financial obligation, contingent or otherwise, of such Person directly or indirectly guaranteeing any Debt of any other Person or in any manner providing for the payment of any Debt of any other Person, including any Obligation of such Person, whether or not contingent, (a) to purchase any primary obligation or any property constituting direct or indirect security therefor, (b) to advance or supply funds (i) for the purchase or payment of any primary obligation or (ii) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (c) to purchase property, assets, securities or services primarily for the purpose of assuring the owner of any primary obligation of the ability of the primary obligor to make payment of such primary obligation or (d) otherwise to assure or hold harmless the holder of any primary obligation against loss in respect thereof; provided that the term “Guarantee Obligation” shall not include endorsements for collection or deposit in the ordinary course of business.  The amount of any Guarantee Obligation shall be determined by reference to the carrying value of such Guarantee Obligation, with the “carrying value” being determined in a manner consistent with the carrying value of the Guarantee Obligations as reflected on the Borrower’s financial statements delivered pursuant to Section 5.03(b) and (c).

 

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“ Guaranteed Obligations ” has the meaning specified in Section 8.01.

 

“ Guarantor ” has the meaning specified in the recital of parties to this Agreement.

 

“ Guaranty ” has the meaning specified in Section 8.01.

 

“ Hazardous Materials ” means (a) petroleum or petroleum products, by-products or breakdown products, radioactive materials, asbestos-containing materials, polychlorinated biphenyls, mold and radon gas and (b) any other chemicals, materials or substances designated, classified or regulated as hazardous, toxic or words of similar import under any Environmental Law.

 

“ Hedge Agreements ” means any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement.

 

“ Indemnified Liabilities ” has the meaning specified in Section 9.04(b).

 

“ Indemnitees ” has the meaning specified in Section 9.04(b).

 

“ Informational Website ” has the meaning specified in Section 5.03.

 

“ Initial Lenders ” means the banks, financial institutions and other institutional lenders listed on the signature pages hereof; provided that any such bank, financial institution or other institutional lender shall cease to be an Initial Lender on any date on which it ceases to hold any Advances.

 

“ Insufficiency ” means, with respect to any ERISA Plan, the amount, if any, of its unfunded benefit liabilities, as defined in Section 4001(a)(18) of ERISA.

 

“ Interest Cash Collateral Sub-Account ” means any cash collateral account (including a joint deposit/securities account) (subject to the terms of the Security Agreement) or sub-account of the Cash Collateral Account to which interest collected in respect of, or arising out of, any Collateral is to be credited pursuant to Section 2.05(c)(iii).

 

“ Interest Cash Collateral Sub-Account Notice ” means a written notice executed by a Responsible Officer of the Borrower requesting an amount of funds to be withdrawn or transferred from the Interest Cash Collateral Sub-Account and (a) setting forth (i) the amount of such funds which are to be applied to the payment of interest in respect of the Advances and (ii) if applicable, the amount of such funds which are to be used by the Borrower and its Subsidiaries for general corporate purposes and (b) certifying, in the case of any withdrawal or transfer referred to in clause (a)(ii) above, compliance with the conditions set forth in the proviso to Section 2.05(c)(iv)(B).

 

“ Interest Period ” means, for each Eurodollar Rate Advance, the period commencing on the date of such Eurodollar Rate Advance or the date of the Conversion of any Base Rate Advance into such Eurodollar Rate Advance, and ending on the last day of the period selected by the Borrower pursuant to the provisions below and, thereafter, each subsequent period commencing on the last day of the

 

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immediately preceding Interest Period and ending on the last day of the period selected by the Borrower pursuant to the provisions below.  The duration of each such Interest Period shall be one, two or three months, as the Borrower may, upon notice received by the Administrative Agent not later than 11:00 A.M. (New York City time) on the third Business Day prior to the first day of such Interest Period, select; provided , however , that:

 

(a)           the Borrower may not select any Interest Period with respect to any Eurodollar Rate Advance that ends after the Maturity Date (or the Specified Repayment Date, if earlier) unless, after giving effect to such selection, the aggregate principal amount of Base Rate Advances and of Eurodollar Rate Advances having Interest Periods that end on or prior to the Maturity Date (or the Specified Repayment Date, if earlier) shall be at least equal to the aggregate principal amount of Advances due and payable on or prior to such date;

 

(b)           whenever the last day of any Interest Period would otherwise occur on a day other than a Business Day, the last day of such Interest Period shall be extended to occur on the next succeeding Business Day, provided , however , that, if such extension would cause the last day of such Interest Period to occur in the next following calendar month, the last day of such Interest Period shall occur on the next preceding Business Day; and

 

(c)           whenever the first day of any Interest Period occurs on a day of an initial calendar month for which there is no numerically corresponding day in the calendar month that succeeds such initial calendar month by the number of months equal to the number of months in such Interest Period, such Interest Period shall end on the last Business Day of such succeeding calendar month.

 

“ Internal Revenue Code ” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

 

“ Investment ” means, with respect to any Person, (a) any direct or indirect purchase or other acquisition (whether for cash, securities, property, services or otherwise) by such Person of, or of a beneficial interest in, any Equity Interests or Debt of any other Person, (b) any direct or indirect purchase or other acquisition (whether for cash, securities, property, services or otherwise) by such Person of all or substantially all of the property and assets of any other Person or of any division, branch or other unit of operation of any other Person, and (c) any direct or indirect loan, advance, other extension of credit or capital contribution by such Person to, or any other investment by such Person in, any other Person (including, without limitation, any arrangement pursuant to which the investor incurs indebtedness of the types referred to in clause (i) or (j) of the definition of “Debt” set forth in this Section 1.01 in respect of such other Person).

 

“ Investors ” has the meaning specified in the Existing Credit Agreement.

 

“ JPMSI ” has the meaning specified in the recital of parties to this Agreement.

 

“ Lead Arrangers ” has the meaning specified in the recital of parties to this Agreement.

 

“ Lender Committee ” means a committee comprising five Lenders, which as of the Closing Date shall be CNAI, JPMorgan Chase Bank, N.A., Deutsche Bank AG Caymans Islands Branch, The Royal Bank of Scotland and Wachovia Bank, N.A.  After the Closing Date, members of the Lender Committee may resign in their sole discretion.  Any Lender that shall cease to be a member of the Lender Committee shall be replaced with another Lender not then a member of the Lender Committee selected by the remaining members of the Lender Committee pursuant to a vote of a majority in number of such remaining members of the Lender Committee ( provided that, if the remaining members of the Lender

 

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Committee are not able to so appoint a replacement for such Lender prior to a decision of such Lender Committee being required hereunder, a replacement shall be appointed by the Required Lenders).  Except as otherwise expressly set forth in this definition of “Lender Committee”, decisions by the Lender Committee shall be made by a vote of a majority in number of all members of the Lender Committee.

 

“ Lenders ” has the meaning specified in the recital of parties to this Agreement.

 

“ Lien ” means any lien, security interest or other charge or encumbrance of any kind, or any other type of preferential arrangement in the nature of a security interest, including, without limitation, the lien or retained security title of a conditional vendor and any easement, right of way or other encumbrance on title to real property.

 

“ Liquidity Availability ” means, at any time, an amount equal to the unrestricted cash and Cash Equivalents of the Borrower and its Subsidiaries (other than any Specified Subsidiaries or any Subsidiaries that are broker-dealers registered with the SEC and with state securities commissions in the United States under state securities laws) (which unrestricted cash and Cash Equivalents, for greater certainty, shall exclude any such property (a) held in the Cash Collateral Account, (b) that is being held as cash collateral or that constitutes escrowed funds or (c) that is otherwise subject to a currently applicable restriction on its withdrawal or distribution to the Borrower or any of its Subsidiaries); provided that Liquidity Availability shall be reduced by the amount of any tax liability reasonably estimated by the Borrower to be incurred as a result of the repatriation from any Foreign Subsidiary of any such cash or Cash Equivalents to the Borrower or any of its domestic Subsidiaries, provided that no such reduction pursuant to this clause (c) shall be required with respect to any funds that are eligible to be used and that the Borrower intends to use to meet the liquidity needs of the Foreign Subsidiary holding such funds (not to exceed $100,000,000 in the aggregate to meet the liquidity needs of all Foreign Subsidiaries).

 

“ Liquidity Condition ” means that (a) the Borrower and its Subsidiaries shall have maintained a Liquidity Availability of at least $450,000,000 on an average daily basis for each of the three months ending immediately prior to any utilization of the Notes Cash Basket and (b) before and after giving effect to the proposed utilization of the Notes Cash Basket, the Borrower shall be in compliance with Sections 5.04(a) and (b).

 

“ Loan Documents ” means (a) this Agreement, (b) the Notes, if any, (c) the Collateral Documents, (d) the Fee Letter (e) any Guaranty Supplement and (f) any other document, agreement or instrument executed and delivered by a Loan Party in connection with the Term Facility, including, without limitation, any intercreditor agreement entered into by the Collateral Agent pursuant to Section 5.02(a)(viii), in each case as amended, supplemented or otherwise modified from time to time in accordance with the terms thereof.

 

“ Loan Parties ” means, collectively, the Borrower and the Guarantors.

 

“ Margin Stock ” has the meaning specified in Regulation U.

 

“ Material Adverse Change ” means any event or occurrence that has resulted in or could reasonably be expected to result in any material adverse change in the business, financial condition, operations or properties of the Borrower and its Subsidiaries, taken as a whole.

 

“ Material Adverse Effect ” means a material adverse effect on (a) the business, financial condition, operations or properties of the Borrower and its Subsidiaries, taken as a whole, (b) the rights and remedies of the Administrative Agent or any Lender under any Loan Document or (c) the ability of any Loan Party to perform its Obligations under any Loan Document to which it is or is to be a party.

 

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“ Material Subsidiary ” means (a) on any date of determination, any direct or indirect Subsidiary of the Borrower that, on such date, has (i) total assets, together with the total assets of all of its Subsidiaries, greater than or equal to 5% of the total consolidated assets of the Borrower and its Subsidiaries or (ii) total revenue, together with the total revenue of all of its Subsidiaries, greater than or equal to 5% of the total consolidated revenue of the Borrower and its Subsidiaries, all as determined in accordance with GAAP and (b) REO Holdco; provided that, notwithstanding the foregoing, any Subsidiary of the Borrower that (A) provides a Guarantee Obligation in respect of any of the Existing Notes, the Existing Credit Facilities, the Existing Bridge Loans or any Permitted Refinancing Debt or (B) owns any REO Property or any other North American mortgage loan or real estate interest, shall in each case be deemed to be a Material Subsidiary ( provided that no Subsidiary that holds solely REO Property other than REO Holdco shall be deemed to be a Material Subsidiary pursuant to this proviso); and provided further that, in no event shall the Subsidiaries of the Borrower (excluding any Excluded Subsidiaries) that are not Material Subsidiaries or Guarantors have (X) total assets greater than or equal to 10% of the total consolidated assets of the Borrower and its Subsidiaries and (Y) total revenue greater than or equal to 10% of the total consolidated revenue of the Borrower and its Subsidiaries, all as determined in accordance with GAAP (it being understood that the Borrower may designate one or more Subsidiaries that would not otherwise qualify as Material Subsidiaries as Material Subsidiaries in order to comply with the terms of this proviso).

 

“ Maturity Date ” means March 23, 2011.

 

“ Moody’s ” means Moody’s Investor Service.

 

“ Mortgage Loan Assets ” means the mortgage loan assets (including mortgage loan assets and mezzanine loans, and in each case, any agreement, note or instrument evidencing a direct or indirect interest therein, interests in respect of “new market tax credit” loans, any mortgage loan assets similar to any of the foregoing, participation interests in any of the foregoing, and any REO Property, but excluding Excluded Mortgage Loan Assets and mortgage servicing rights) of the Loan Parties and their respective Subsidiaries (other than any Specified Excluded Subsidiaries) to the extent relating to real property located in the United States or Canada.

 

“ Mortgages ” shall mean deeds of trust, trust deeds, mortgages, leasehold mortgages and leasehold deeds of trust in form and substance satisfactory to the Administrative Agent, pursuant to which, among other things, a Loan Party owning or leasing real property grants a first priority perfected Lien on such real property securing the Secured Obligations to the Collateral Agent for its own benefit and the benefit of the other Secured Parties.

 

“ Multiemployer Plan ” means a multiemployer plan, as defined in Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA Affiliate is making or accruing an obligation to make contributions, or has within any of the preceding five plan years made or accrued an obligation to make contributions.

 

“ Multiple Employer Plan ” means a single employer plan, as defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any Loan Party or any ERISA Affiliate and at least one Person other than the Loan Parties and the ERISA Affiliates or (b) was so maintained within any of the preceding five plan years and in respect of which any Loan Party or any ERISA Affiliate could have liability under Section 4064 or 4069 of ERISA in the event such plan has been or were to be terminated.

 

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“ Net Cash Proceeds ” means:

 

(a)           with respect to any Collateral Disposition, Collateral Recovery Event or any Other Collateral Collection, the gross cash proceeds received in connection with such Collateral Disposition, Collateral Recovery Event or Other Collateral Collection, net of attorneys’ fees, accountants’ fees, investment banking fees and other customary fees and expenses actually incurred in connection therewith and in each case directly related to such Collateral Disposition, Collateral Recovery Event or Other Collateral Collection, as the case may be, and net of taxes paid or reasonably estimated to be payable as a direct result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements); and

 

(b)           with respect to the sale or issuance of any Equity Interests by any Loan Party or any of its Subsidiaries, or the incurrence or issuance of any Debt by any Loan Party or any of its Subsidiaries, the gross cash proceeds received in connection with such transaction, net of attorneys’ fees, investment banking fees, accountants’ fees, underwriting discounts and commissions and other customary fees and expenses actually incurred in connection therewith and in each case directly related to such transaction.

 

“ Non-Loan Party ” means any Subsidiary of a Loan Party that is not a Loan Party.

 

“ Non-Performing Mortgage Loan ” means any Mortgage Loan Asset classified as non-performing in accordance with the Loan Parties’ internal procedures, consistent with past practice.

 

“ Non-Reserve Cash Collateral Sub-Account ” means any cash collateral account (subject to the terms of the Security Agreement) or any sub-account of the Cash Collateral Account to which Non-Reserve Funds are to be credited pursuant to Section 2.05(c)(iii).

 

“ Non-Reserve Funds ” has the meaning specified in Section 2.05(c)(iii).

 

“ Non-U.S. Lender ” has the meaning specified in Section 2.11(e).

 

“ Note ” means a promissory note of the Borrower payable to the order of any Lender, in substantially the form of Exhibit A hereto, evidencing the aggregate indebtedness of the Borrower to such Lender resulting from the Advances made by such Lender.

 

“ Notes Cash Basket ” has the meaning specified in Section 5.02(k).

 

“ Notice of Borrowing ” has the meaning specified in Section 2.02(a).

 

“ Notice of Default ” has the meaning specified in Section 7.05.

 

“ Obligation ” means, with respect to any Person, any payment, performance or other obligation of such Person of any kind, including, without limitation, any liability of such Person on any claim, whether or not the right of any creditor to payment in respect of such claim is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, disputed, undisputed, legal, equitable, secured or unsecured, and whether or not such claim is discharged, stayed or otherwise affected by any proceeding under any Debtor Relief Law.  Without limiting the generality of the foregoing, the Obligations of the Loan Parties under the Loan Documents include (a) the obligation to pay principal, interest, charges, expenses, fees, attorneys’ fees and disbursements, indemnities and other amounts payable by any Loan Party under any Loan Document and (b) the obligation of any Loan Party to reimburse any amount in

 

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respect of any of the foregoing that any Lender, in its sole discretion, may elect to pay or advance on behalf of such Loan Party.

 

“ Other Collateral Collections ” means any amounts received or collected in respect of, or arising out of any Collateral (including, for the avoidance of doubt, any REO Property) (including payments and prepayments of principal, payments of interest and fees, settlements and sales of participation interests, in each case in respect of Collateral or REO Property), other than in each case to the extent constituting a Collateral Disposition.

 

“ Other Taxes ” has the meaning specified in Section 2.11(b).

 

“ Patriot Act ” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub.  L. 107-56, signed into law October 26, 2001.

 

“ PBGC ” means the Pension Benefit Guaranty Corporation (or any successor).

 

“ Permitted Lien ” means:

 

(a)       Liens in favor of the Administrative Agent and/or the Collateral Agent for the benefit of the Secured Parties and the other parties intended to share the benefits of the Collateral granted pursuant to any of the Loan Documents;

 

(b)       Liens for taxes and other obligations or requirements owing to or imposed by governmental authorities existing or having priority, as applicable, by operation of law which in either case (i) are not yet overdue or (ii) are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted so long as appropriate reserves in accordance with GAAP shall have been made with respect to such taxes or other obligations;

 

(c)       statutory Liens of banks and other financial institutions (and rights of set-off);

 

(d)       statutory Liens of landlords, carriers, warehousemen, mechanics, repairmen, workmen and materialmen, and other Liens imposed by law (other than any such Lien imposed pursuant to Section 430(k) of the Internal Revenue Code or by ERISA), in each case incurred in the ordinary course of business (i) for amounts not yet overdue or (ii) for amounts that are overdue and that (in the case of any such amounts overdue for a period in excess of five days) are being contested in good faith by appropriate proceedings, so long as such reserves or other appropriate provisions, if any, as shall be required by GAAP shall have been made for any such contested amounts;

 

(e)       Liens incurred in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security;

 

(f)        Liens, pledges and deposits to secure the performance of tenders, statutory obligations, performance and completion bonds, surety bonds, appeal bonds, bids, leases, licenses, government contracts, trade contracts, performance and return-of-money bonds and other similar obligations;

 

(g)       easements, rights-of-way, zoning restrictions, licenses, encroachments, restrictions on use of real property and other similar encumbrances incurred in the ordinary course of business, in each case that were not incurred in connection with and do not secure Debt

 

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and do not materially and adversely affect the use of the property encumbered thereby for its intended purposes;

 

(h)       (i) any interest or title of a lessor under any lease by the Borrower or any Subsidiary of the Borrower and (ii) any leases or subleases by the Borrower or any Subsidiary of the Borrower to another Person(s), incurred in the ordinary course of business and that do not materially and adversely affect the use of the property encumbered thereby for its intended purposes;

 

(i)        the filing of precautionary UCC financing statements relating to leases entered into in the ordinary course of business and the filing of UCC financing statements by bailees and consignees in the ordinary course of business;

 

(j)        Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;

 

(k)       leases and subleases or licenses and sublicenses of patents, trademarks and other intellectual property rights granted by the Borrower or any of its Subsidiaries in the ordinary course of business and not interfering in any respect with the ordinary conduct of the business of the Borrower or such Subsidiary; and

 

(l)        Liens arising out of judgments not constituting an Event of Default hereunder.

 

“ Permitted Notes Refinancing ” means the refinancing, refunding, exchange or replacement of any of the Existing Notes with Permitted Refinancing Debt.

 

“ Permitted Refinancing Debt ” means any Debt issued or incurred in connection with the refinancing, refunding, exchange or replacement of the Existing Notes (and, to the extent that any such Debt (x) is accepted by any Existing Credit Facility Lenders to refinance, refund, exchange or replace Debt under the Existing Credit Facilities, the Existing Credit Facilities or (y) is accepted by any Existing Bridge Loan Lenders to refinance, refund, exchange or replace the Existing Bridge Loans, the Existing Bridge Loans); provided that (a) no Default shall have occurred and be continuing before and after giving effect to such issuance or incurrence, (b) in connection with any such issuance or incurrence, the Existing Credit Facility Lenders and the Existing Bridge Loan Lenders shall be offered, on a proportionate basis in accordance with the provisions of the Existing Credit Agreement and the Existing Bridge Loan Agreement, as applicable, such Permitted Refinancing Debt on the same terms and conditions (including, without limitation, the same security package) ( provided , however , that in connection with any payment, redemption, exchange or repurchase of the Existing Notes in which availability under the Notes Cash Basket is utilized in connection with such transaction, any such proportionate offer to the Existing Credit Facility Lenders and the Existing Bridge Loan Lenders (i) need not include any cash payment to the Existing Credit Facility Lenders or the Existing Bridge Loan Lenders to the extent that a cash payment is made out of the proceeds from the Notes Cash Basket (and in the event that no cash payment is made to the Existing Credit Facility Lenders and the Existing Bridge Loan Lenders, such proportionate offer shall be determined as if no cash payment were made to the holders of the Existing Notes) and (ii) may include a cash payment to the Existing Credit Facility Lenders and/or the Existing Bridge Loan Lenders, provided that any such cash payment to the Existing Credit Facility Lenders or the Existing Bridge Loan Lenders shall not reduce the Notes Cash Basket), (c) no Permitted Refinancing Debt shall have any scheduled or mandatory principal repayments prior to August 23, 2011 and (d) the principal amount of the Debt being refinanced, refunded, exchanged or replaced shall not be increased above the principal amount thereof outstanding immediately prior to such refinancing, refunding, exchange or replacement.

 

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“ Person ” means an individual, partnership, corporation (including a business trust), limited liability company, joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof.

 

“ Platform ” has the meaning specified in Section 9.02(b).

 

“ Post-Petition Interest ” has the meaning specified in Section 8.06.

 

“ Preferred Interests ” means, with respect to any Person, Equity Interests issued by such Person that are entitled to a preference or priority over any other Equity Interests issued by such Person upon any distribution of such Person’s property and assets, whether by dividend or upon liquidation.

 

“ Projections ” has the meaning specified in Section 5.03(f).

 

“ Real Estate Collateral Deliverables ” means the delivery of Mortgages covering each REO Property and any other real property that constitutes Collateral duly executed by the appropriate Loan Party, together with:

 

(a)           evidence that counterparts of the Mortgages have been duly executed, acknowledged and delivered on or before the date specified in Sections 5.01(i) or (q), as applicable, and are in form suitable for filing or recording in all filing or recording offices that the Collateral Agent may deem necessary or may reasonably request in order to create a valid first and subsisting Lien (subject to Permitted Liens) on the property described therein in favor of the Collateral Agent for the benefit of the Secured Parties and that all filing and recording taxes and fees have been or, contemporaneous with the recording of such Mortgage, will be, paid;

 

(b)           to the extent not already pledged to the Collateral Agent pursuant to the Security Agreement at such time, a pledge of the Equity Interests in the Subsidiary holding such REO Property;

 

(c)           favorable opinions of local counsel for the Loan Parties (i) in states in which the REO Properties or real properties are located, with respect to the enforceability and perfection of the Mortgages and any related fixture filings in form and substance reasonably satisfactory to the Collateral Agent and (ii) in states in which the Loan Parties party to the Mortgages are organized or formed, with respect to the valid existence, corporate power and authority of such Loan Parties in the granting of the Mortgages, in form and substance satisfactory to the Collateral Agent; and

 

(d)           such other evidence that all other actions that the Collateral Agent may deem necessary or may reasonably request in order to create valid first and subsisting Liens on the property described in the Mortgages has been taken.

 

“ Receivable ” means any right of payment from or on behalf of any obligor (including mortgagor), whether constituting an account, chattel paper, instrument, general intangible or otherwise, acquired or arising from the financing or leasing by the Borrower or any of its Subsidiaries of property or services, and monies due thereunder, security interests in the property and services financed or leased thereby and any and all other related rights.

 

“ Redeemable ” means, with respect to any Equity Interest, Debt or other right or Obligation, any such right or Obligation that (a) the issuer has undertaken to redeem at a fixed or determinable date or dates, whether by operation of a sinking fund or otherwise, or upon the occurrence of a condition not solely within the control of the issuer or (b) is redeemable at the option of the holder.

 

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“ Register ” has the meaning specified in Section 9.07(d).

 

“ Regulation U ” means Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time.

 

“ REO Holdco ” means Capmark REO Holding LLC, a Delaware limited liability company.

 

“ REO Mortgage Condition ” has the meaning specified in Section 5.01(q).

 

“ REO Property ” means (a) real property acquired by the Borrower (or any of its Subsidiaries (other than any Specified Subsidiaries)) by foreclosure, acceptance of a deed-in-lieu of foreclosure, abandonment or reclamation from bankruptcy in connection with a default in partial or total satisfaction of a Non-Performing Mortgage Loan and (b) any Equity Interests in any Person owning property of the type described in the foregoing clause (a).

 

“ Required Lenders ” means, at any time, Lenders owed or holding at least a majority in interest of the aggregate principal amount of the Advances outstanding at such time (or, if the Advances are not outstanding at such time, the aggregate amount of the Commitments at such time); provided , however , that if any Lender shall be a Defaulting Lender at such time, there shall be excluded from the determination of Required Lenders at such time the unused Commitment of, and the aggregate principal amount of the Advances owing to such Lender (in its capacity as a Lender) and outstanding at such time.

 

“ Requirement of Law ” means, as to any Person, any law, treaty, rule or regulation or determination of an arbitrator or a court or other governmental authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

 

“ Reserve Cash Collateral Sub-Account ” means any cash collateral account (including a joint deposit/securities account) (subject to the terms of the Security Agreement) or any sub-account of the Cash Collateral Account to which Reserve Funds are to be credited pursuant to Section 2.05(c)(iii).

 

“ Reserve Cash Collateral Sub-Account Notice ” means a written notice executed by a Responsible Officer of the Borrower requesting an amount of funds to be withdrawn or transferred from the Reserve Cash Collateral Sub-Account and certifying compliance with the conditions set forth in the proviso to Section 2.05(c)(v).

 

“ Reserve Funds ” has the meaning specified in Section 2.05(c)(iii).

 

“ Responsible Officer ” means the chief executive officer, president, senior vice president, executive vice president, vice president, chief financial officer, chief accounting officer, controller, treasurer or assistant treasurer of a Loan Party.  Any document delivered hereunder or under any other Loan Document that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

 

“ Restricting Information ” has the meaning set forth in Section 9.09(c).

 

“ Run Rate Operating Expense ” means, for any period, an amount equal to:  (a) total operating expenses of the Borrower and its Subsidiaries on a Consolidated basis for such period; less (b) total operating expenses of the Specified Subsidiaries on a Consolidated basis for such period (other

 

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than any such operating expenses that, (x) prior to such period, were operating expenses of the Borrower or any of its Subsidiaries (other than any Specified Subsidiaries) and (y) have been migrated to the Specified Subsidiaries in connection with the implementation of any restructuring, winding down or disposition of business units or assets of the Borrower and its Subsidiaries or the implementation of the operating cost reduction plan of the Borrower); less (c) the sum of (without duplication):  (i) the amount of depreciation and amortization expense and impairment charges in respect of fixed assets, mortgage servicing rights and intangible assets; (ii) non-cash expenses or charges incurred in connection with the granting of, or accretion on, options, warrants or other Equity Interests pursuant to any management or director equity plan, stock option plan or similar employee compensation arrangement; (iii) any expenses or charges directly related to the restructuring of the Existing Notes, the Existing Credit Facilities or the Existing Bridge Loans accounted for in such period, including the ongoing fees and expenses required to be paid to the Lenders or their advisors in connection with the restructuring of the Existing Credit Facilities and the Existing Bridge Loans; (iv) solely with respect to the Fiscal Quarters ended June 30, 2009, September 30, 2009, December 31, 2009 and March 31, 2010, the amount of any one-time restructuring charges, costs or other business optimization expenses directly incurred in connection with the restructuring, winding down or disposition of business units or assets outside of the ordinary course of business of the Borrower and its Subsidiaries or the implementation of the operating cost reduction plan of the Borrower (including professional fees and expenses, severance costs, contract breakage costs and costs related to the closure and/or consolidation of facilities) during such period; provided that the amount of restructuring charges, costs and expenses deducted from Run Rate Operating Expenses pursuant to this clause (iv) shall not exceed $50,000,000 in the aggregate; and (v) operating expenses of variable interest entities that are required to be Consolidated with the Borrower pursuant to FASB Interpretation No. 46(R), operating expenses of investment partnerships and similar entities that are required to be Consolidated with the Company pursuant to Emerging Issues Task Force Issue No. 04-5  and operating expenses of entities that are required to be Consolidated with the Borrower pursuant to Statement of Financial Accounting Standards No. 66 or similar accounting principles implemented by applicable accounting standards bodies after the date hereof relating to consolidation of subsidiaries; in each case of the Borrower and its Subsidiaries (excluding the Specified Subsidiaries) for such period; plus (c) (X) the Applicable Adjustment Percentage times (Y) the aggregate amount of operating expenses of any Servicing Business subject to a Servicing Business Disposition prior to or during such period for the portion of such period occurring after the date of such Servicing Business Disposition (determined on a pro forma basis based on the last full fiscal quarter period ending immediately prior to the date of such Servicing Business Disposition and making the adjustments, to the extent applicable, set forth in this definition of “Run Rate Operating Expense”); all as determined for such period in accordance with GAAP.

 

“ S&P ” means Standard & Poor’s Financial Services LLC, a subsidiary of The Mc-Graw Hill Companies, Inc.

 

“ SEC ” means the United States Securities and Exchange Commission or any governmental authority succeeding to any of its principal functions.

 

“ Secured Obligation ” has the meaning specified in the Security Agreement.

 

“ Secured Parties ” means, collectively, each Agent and the Lenders.

 

“ Security Agreement ” has the meaning specified in Section 3.01(a).

 

“ Servicing Advance Assets ” means the assets, whether now owned or hereafter acquired, of the Borrower and its Subsidiaries comprising (a) Servicing Advances and (b) all reimbursement rights and other amounts owing to the Borrower and its Subsidiaries with respect to Servicing Advances.

 

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“ Servicing Advances ” means advances made by the Borrower or any of its Subsidiaries, in its respective capacity as servicer under any Servicing Agreement, in connection with the servicing and administering of any mortgage loans or any mortgaged property including but not limited to (i) advances of principal and interest payments on mortgage loans and (ii) advances of out-of-pocket costs and expenses incurred by the applicable servicer in respect of mortgage loans in which a default, delinquency or other unanticipated event has occurred or as to which a default is imminent, including, with respect to any underlying mortgaged property, advances necessary for the purpose of effecting the payment of real estate taxes, assessments and other similar items that are or may become a lien thereon, premiums on insurance policies, advances generally known as “emergency advances” or “property protection advances” under any Servicing Agreement, costs of any enforcement or judicial proceedings, maintenance and liquidation of any acquired mortgaged property, extraordinary trust fund expenses, ground rents and similar charges or assessments.

 

“ Servicing Advance Facility ” means any credit facility, securitization facility or other financing facility obtained by the Borrower or any of its Subsidiaries in connection with the financing of any Servicing Advance Assets.

 

“ Servicing Advance Facility Document ” means any credit agreement or any other document, agreement or instrument executed and delivered by the Borrower or any of its Subsidiaries in connection with any Servicing Advance Facility.

 

“ Servicing Agreement ” means any pooling and servicing agreement, trust and servicing agreement, primary servicing agreement or other similar document pursuant to which the Borrower or any of its Subsidiaries services mortgage loans or any mortgaged property acquired through foreclosure, acceptance of a deed-in-lieu of foreclosure or otherwise in accordance with applicable law in connection with the default or imminent default of any mortgage loans, and makes Servicing Advances with respect thereto.

 

“ Servicing Business ” means the North American “servicing” segment of the Borrower and its Subsidiaries.

 

“ Servicing Business Disposition ” means any sale, transfer or other disposition of, or closure of the Servicing Business or any material portion thereof pursuant to any transaction or any series of related transactions (including by means of a disposition of any Person or a disposition of all or substantially all of the assets or property of such Servicing Business).

 

“ Single Employer Plan ” means a single employer plan, as defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any Loan Party or any ERISA Affiliate and no Person other than the Loan Parties and the ERISA Affiliates or (b) was so maintained within any of the preceding five plan years and in respect of which any Loan Party or any ERISA Affiliate could have liability under Section 4069 of ERISA in the event such plan has been or were to be terminated.

 

“ Specified Excluded Subsidiaries ” means:  (a) Excluded Subsidiaries of the type described in clauses (d), (e) or (h) of the definition thereof; (b) variable interest entities that are required to be Consolidated with the Borrower pursuant to FASB Interpretation No. 46(R), investment partnerships and similar entities that are required to be Consolidated with the Company pursuant to Emerging Issues Task Force Issue No. 04-5 and entities that are required to be Consolidated with the Borrower pursuant to Statement of Financial Accounting Standards No. 66 or similar accounting principles implemented by applicable accounting standards bodies after the date hereof relating to consolidation of subsidiaries; and (c) Subsidiaries comprising investment funds organized in connection with the “low income housing tax credit program” or “new markets tax credit program” of the Borrower,

 

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or special purpose entities formed in connection with investment funds managed by the Borrower and its Subsidiaries or entities owned by such investment funds.

 

“ Specified Repayment Date ” has the meaning specified in Section 2.17.

 

“ Specified Servicing Advance Facility ” means the proposed Servicing Advance Facility disclosed by the Borrower to the Lead Arrangers prior to the Closing Date, to the extent that such Servicing Advance Facility is consummated on substantially the same terms and conditions as disclosed by the Borrower to the Lead Arrangers.

 

“ Specified Subsidiaries ” means the collective reference to (a) Capmark Bank, an industrial bank chartered under the laws of the State of Utah, (b) Escrow Bank USA, an industrial bank chartered under the laws of the State of Utah, (c) Capmark Bank Europe PLC, an Irish licensed bank and (d) any Subsidiary of any of the foregoing.

 

“ SPC ” has the meaning specified in Section 9.07(j).

 

“ Subordinated Obligations ” has the meaning specified in Section 8.06.

 

“ Subsidiary ” of any Person means any corporation, partnership, joint venture, limited liability company, trust or estate of which (or in which) more than 50% of (a) the issued and outstanding capital stock having ordinary voting power to elect a majority of the Board of Directors of such corporation (irrespective of whether at the time capital stock of any other class or classes of such corporation shall or might have voting power upon the occurrence of any contingency), (b) the interest in the capital or profits of such partnership, joint venture or limited liability company or (c) the beneficial interest in such trust or estate is at the time directly or indirectly owned or controlled by such Person, by such Person and one or more of its other Subsidiaries or by one or more of such Person’s other Subsidiaries.

 

“ Supermajority Lenders ” means, at any time, Lenders owed or holding at least 66 2/3% in interest of the aggregate principal amount of the Advances outstanding at such time (or, if the Advances are not outstanding at such time, the aggregate amount of the Commitments at such time); provided , however, that if any Lender shall be a Defaulting Lender at such time, there shall be excluded from the determination of Supermajority Lenders at such time the unused Commitment of, and the aggregate principal amount of the Advances owing to such Lender (in its capacity as a Lender) and outstanding at such time.

 

“ Supplemental Collateral Agent ” has the meaning specified in Section 7.02.

 

“ Surviving Debt ” means Debt of the Borrower and its Subsidiaries outstanding immediately after giving effect to the Closing Date and the Transactions; provided that, to the extent that such Debt is Debt For Borrowed Money, such Debt is described on Schedule 1.01(b).

 

“ Syndication Agent ” has the meaning specified in the recital of parties to this Agreement.

 

“ Synthetic Debt ” means, with respect to any Person, without duplication of any clause within the definition of “Debt,” all (a) obligations of such Person under any lease that is treated as an operating lease for financial accounting purposes and a financing lease for tax purposes (i.e., a “synthetic lease”), (b) obligations (other than syndication proceeds in the ordinary course) of such Person in respect of transactions entered into by such Person (other than deposit liabilities), the proceeds from which would be reflected on the financial statements of such Person in accordance with GAAP as cash flows from

 

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financings at the time such transaction was entered into (other than as a result of equity contributions or the issuance of equity interests) and (c) obligations of such Person in respect of other transactions entered into by such Person that are not otherwise addressed in the definition of “Debt” or in clause (a) or (b) above that are intended to function primarily as a borrowing of funds (including, without limitation, any non-controlling interest transactions that function primarily as a borrowing).

 

“ Taxes ” has the meaning specified in Section 2.11(a).

 

“ Term Facility ” means, at any time, (a) prior to the funding of the Advances pursuant to Section 2.01, the aggregate amount of the Lenders’ Commitments at such time and (b) on and after the funding of the Advances pursuant to Section 2.01, the outstanding principal amount of the Advances at such time.

 

“ Termination Date ” means the earliest to occur of (i) the Maturity Date, (ii) the Specified Repayment Date and (ii) the date of the acceleration of the Advances pursuant to Section 6.01.

 

“ Test Period ” means, with respect to the financial covenant contained in Section 5.04(a):  (a) at any date of determination on or prior to June 30, 2009, the most recently completed Fiscal Quarter; (b) at any date of determination after June 30, 2009 and on or prior to September 30, 2009, the most recently completed two Fiscal Quarters of the Borrower ending on or prior to such date; (c) at any date of determination after September 30, 2009 and on or prior to December 31, 2009, the most recently completed three Fiscal Quarters of the Borrower ending on or prior to such date; and (d) at any date of determination after December 31, 2009, the most recently completed four Fiscal Quarters of the Borrower ending on or prior to such date.

 

“ Transactions ” means, collectively, (a) the entering into by the Loan Parties and their applicable Subsidiaries of the Loan Documents to which they are or are intended to be a party, and the borrowings hereunder on the Closing Date and application of the proceeds as contemplated hereby (including the refinancing of a portion of the Debt outstanding under the Existing Credit Facilities and a portion of the Existing Bridge Loans in each case on the Closing Date) and (b) the payment of the fees and expenses incurred in connection with the consummation of the foregoing.

 

“ Type ” refers to the distinction between Advances bearing interest at the Base Rate and Advances bearing interest at the Eurodollar Rate.

 

“ UCC ” means the Uniform Commercial Code as in effect, from time to time, in the State of New York; provided that, if perfection or the effect of perfection or non-perfection or the priority of any security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, “UCC” means the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or non-perfection or priority.

 

“ Voting Stock ” means capital stock issued by a corporation, or equivalent interests in any other Person, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Person, even if the right so to vote has been suspended by the happening of such a contingency.

 

“ Withdrawal Liability ” has the meaning specified in Part I of Subtitle E of Title IV of ERISA.

 

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Section 1.02           Computation of Time Periods .  In this Agreement and the other Loan Documents, in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding”.

 

Section 1.03           Accounting Terms and Financial Determinations .  All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles in the United States of America in effect from time to time (“ GAAP ”).

 

Section 1.04           Terms Generally .  The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.”  The word “will” shall be construed to have the same meaning and effect as the word “shall.”  Unless the context requires otherwise, (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Sections, Schedules and Exhibits shall be construed to refer to Sections of, and Schedules and Exhibits to, this Agreement, (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all real property, tangible and intangible assets and properties, including cash, securities, accounts and contract rights, and interests in any of the foregoing, and (f) any reference to a statute, rule or regulation is to that statute, rule or regulation as now enacted or as the same may from time to time be amended, re-enacted or expressly replaced.  Any reference herein to the “ordinary course of business of the Borrowers and its Subsidiaries consistent with past practice” shall include reasonable adaptations of such past practice of the Borrower and its Subsidiaries taking into account changes in the business condition of the Borrower and its Subsidiaries or industry or counterparty practices or requirements.

 

ARTICLE II

 

AMOUNTS AND TERMS OF THE ADVANCES

 

Section 2.01           The Advances .  Each Lender, severally and not jointly with the other Lenders agrees, upon the terms and subject to the conditions herein set forth, to make a single advance (each, an “ Advance ”) to the Borrower on the Closing Date in an amount not to exceed such Lender’s Commitment.  The Borrowing shall consist of Advances made simultaneously by the Lenders ratably according to the Lenders’ Commitments.  Amounts borrowed under this Section 2.01 and repaid or prepaid may not be reborrowed.

 

Section 2.02           Making the Advances .

 

(a)           The Borrowing shall be made on notice, given not later than 11:00 A.M. (New York City time) on the third Business Day prior to the Closing Date if the Borrowing consists of Eurodollar Rate Advances, or the first Business Day prior to the Closing Date if the Borrowing consists of Base Rate Advances, by the Borrower to the Administrative Agent, which shall give to each applicable Lender prompt notice thereof by telecopier or other electronic communication.  Such notice of the Borrowing (the “ Notice of Borrowing ”) shall be by telephone, confirmed immediately in writing, or telecopier, in substantially the form of Exhibit B hereto, specifying therein the requested (i) date of

 

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the Borrowing, (ii) Type of Advances comprising the Borrowing, (iii) aggregate amount of the Borrowing and (iv) if the Borrowing consists of Eurodollar Rate Advances, initial Interest Period for each such Advance.  Each applicable Lender shall, before 11:00 A.M. (New York City time) on the date of the Borrowing, make available for the account of its Applicable Lending Office to the Administrative Agent at the Administrative Agent’s Account, in same day funds, such Lender’s ratable portion of the Borrowing in accordance with the respective Commitments of such Lender and the other applicable Lenders.  After the Administrative Agent’s receipt of such funds and upon fulfillment of the applicable conditions set forth in Article III, the Administrative Agent will make such funds available to the Borrower by crediting the Borrower’s Account or such other account as the Borrower shall request in the applicable Notice of Borrowing.

 

(b)           (i) Anything in Section 2.02(a) above to the contrary notwithstanding, the Borrower may not select Eurodollar Rate Advances for the Borrowing hereunder if the aggregate amount of the Borrowing is less than $5,000,000 or if the obligation of the Lenders to make Eurodollar Rate Advances shall then be suspended pursuant to Section 2.08 or 2.09 and (ii) anything in Section 2.02(a) above or Section 2.08 below to the contrary notwithstanding, there shall not at any time be more than ten Interest Periods in effect.

 

(c)           The Notice of Borrowing shall be irrevocable and binding on the Borrower.  If the Notice of Borrowing specifies that the Borrowing is to be composed of Eurodollar Rate Advances, the Borrower shall indemnify each Lender against any loss, cost or expense incurred by such Lender as a result of any failure to fulfill on or before the date specified in such Notice of Borrowing for the Borrowing the applicable conditions set forth in Article III, including, without limitation, any loss (including loss of anticipated profits), cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund the Advance to be made by such Lender as part of the Borrowing when such Advance, as a result of such failure, is not made on such date.

 

(d)           Unless the Administrative Agent shall have received notice from an applicable Lender prior to the date of the Borrowing that such Lender will not make available to the Administrative Agent such Lender’s ratable portion of the Borrowing, the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent on the date of the Borrowing in accordance with Section 2.02(a) and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount.  If and to the extent that such Lender shall not have so made such ratable portion available to the Administrative Agent, such Lender and the Borrower severally agree to repay or pay to the Administrative Agent forthwith on demand such corresponding amount and to pay interest thereon, for each day from the date such amount is made available to the Borrower until the date such amount is repaid or paid to the Administrative Agent, at (i) in the case of the Borrower, the interest rate applicable at such time under Section 2.06 to Advances comprising the Borrowing and (ii) in the case of such Lender, the Federal Funds Rate.  If such Lender shall pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender’s Advance as part of the Borrowing for all purposes of this Agreement.

 

(e)           The failure of any Lender to make the Advance to be made by it shall not relieve any other Lender of its obligation, if any, hereunder to make its Advance on the date of the Borrowing, but no Lender shall be responsible for the failure of any other Lender to make the Advance to be made by such other Lender on the date of the Borrowing.

 

Section 2.03           Repayment of the Advances .  The Borrower shall repay the Advances to the Administrative Agent for the ratable account of the Lenders on the Termination Date and in any event,

 

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such repayment shall be in an amount equal to the aggregate principal amount of the Advances outstanding on such date.

 

Section 2.04           Termination of Commitments .  The Commitments shall be automatically and permanently reduced and terminated on the Closing Date, by the amount, if any, by which the aggregate Commitments exceed the Advances outstanding on such date (after giving effect to the Borrowing on such date).  Upon the making of the Advance pursuant to Section 2.01 by any Lender, the Commitment of such Lender shall be automatically and permanently reduced by the amount of such Advance.

 

Section 2.05           Prepayments and Cash Collections .

 

(a)           Optional .  The Borrower may, upon at least three Business Days’ notice to the Administrative Agent received not later than 12:00 noon (New York, New York time) stating the proposed date and aggregate principal amount of the prepayment, and if such notice is given the Borrower shall, prepay the outstanding aggregate principal amount of Advances, in whole or ratably in part, together with accrued interest to the date of such prepayment on the aggregate principal amount prepaid; provided , however , that (i) each partial prepayment shall be in an aggregate principal amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof or, if less, the aggregate outstanding principal amount of all Advances and (ii) that no prepayment of Eurodollar Rate Advances shall be permitted pursuant to this Section 2.05(a) other than on the last day of the Interest Period applicable thereto unless such prepayment is accompanied by the payment of the amounts required by Section 9.04(c).

 

(b)           Mandatory .

 

(i)            If at any time any Loan Party or any of its Subsidiaries (excluding any Specified Excluded Subsidiary or any Subsidiary which is prohibited from applying such Net Cash Proceeds to the prepayment of the Advances by any Contractual Obligation entered into prior to the Closing Date (or, in the case of any Subsidiary formed or acquired by the Borrower subsequent to the Closing Date, prior to such formation or acquisition) and not in contemplation of this provision) shall receive Net Cash Proceeds from the issuance or incurrence of any Debt (other than any Debt permitted under Section 5.02(b)), the Borrower shall, within one Business Day after the date of receipt (or the Borrower’s knowledge of receipt) of such Net Cash Proceeds by such Loan Party or any of its Subsidiaries (excluding any Specified Excluded Subsidiary or any Subsidiary which is prohibited from applying such Net Cash Proceeds to the prepayment of the Advances by any Contractual Obligation entered into prior to the Closing Date (or, in the case of any Subsidiary formed or acquired by the Borrower subsequent to the Closing Date, prior to such formation or acquisition) and not in contemplation of this provision), prepay the Advances in an amount equal to 100% of such Net Cash Proceeds.

 

(ii)           If at any time any Loan Party or any of its Subsidiaries shall receive Net Cash Proceeds from the issuance by such Loan Party or any of its Subsidiaries of any of its Equity Interests (other than (A) Equity Interests issued pursuant to employee stock plans or (B) to the extent permitted hereunder, Equity Interests issued to a Loan Party), the Borrower shall, within one Business Day after the date of receipt (or the Borrower’s knowledge of receipt) of such Net Cash Proceeds by such Loan Party or any of its Subsidiaries, prepay the Advances in an amount equal to 100% of such Net Cash Proceeds.

 

(iii)          All prepayments under this Section 2.05(b) shall be made together with accrued interest to the date of such prepayment on the principal amount prepaid, and, if any such

 

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prepayment is made on a day other than on the last day of the Interest Period applicable thereto, such prepayment shall be accompanied by the payment of the amounts required by Section 9.04(c).

 

(c)           Cash Collateral Account .

 

(i)            On or prior to the Closing Date, the Collateral Agent shall establish the Cash Collateral Account, the Interest Cash Collateral Sub-Account, the Reserve Cash Collateral Sub-Account and the Non-Reserve Cash Collateral Sub-Account on behalf of the Borrower.

 

(ii)           If at any time any Loan Party or any of its Subsidiaries shall receive Net Cash Proceeds from any (A) Collateral Disposition, (B) Collateral Recovery Event or (C) without duplication to the foregoing clause (A), Other Collateral Collections, the Borrower shall promptly, but in any event within one Business Day (or, in the case of any such Net Cash Proceeds received in Canadian dollars, within three Business Days) after the date of receipt or collection of such Net Cash Proceeds by such Loan Party or any of its Subsidiaries, deposit into the Cash Collateral Account an amount equal to 100% of the Dollar equivalent of such Net Cash Proceeds.

 

(iii)          On each date on which the amounts deposited in the Cash Collateral Account are reconciled by the Borrower in accordance with the Borrower’s customary procedures consistent with past practice (which reconciliation shall in any event occur at least once every calendar month), the Borrower shall notify the Collateral Agent in writing of such reconciliation (providing reasonable detail thereof) and request the Collateral Agent to credit the funds deposited in the Cash Collateral Account to cash collateral accounts (including joint deposit/securities accounts) (subject to the terms of the Security Agreement) or sub-accounts of the Cash Collateral Account as follows:

 

(A)          funds in the Cash Collateral Account consisting of interest received or collected in respect of, or otherwise arising out of any Collateral shall be credited to the Interest Cash Collateral Sub-Account;

 

(B)           the first $150,000,000 of funds in the Cash Collateral Account (excluding any funds described in the foregoing clause (A)), shall be credited to the Reserve Cash Collateral Sub-Account (such funds credited to the Reserve Cash Collateral Sub-Account are referred to herein as the “ Reserve Funds ”); and

 

(C)           funds in the Cash Collateral Account (excluding any funds described in the foregoing clauses (A) and (B)) shall be transferred to the Non-Reserve Cash Collateral Sub-Account (such funds credited to the Non-Reserve Cash Collateral Sub-Account are referred to herein as the “ Non-Reserve Funds ”).

 

(iv)          Within three Business Days prior to any date on which interest is required to be paid in respect of the Advances, the Borrower shall deliver an Interest Cash Collateral Sub-Account Notice to the Collateral Agent.  The Collateral Agent shall, on such scheduled interest payment date, transfer funds from the Interest Cash Collateral Sub-Account (A)  first , to the Administrative Agent to pay outstanding interest in respect of the Advances that is due on or prior to such date, and (B)  second , to the Borrower as so requested in such Interest Cash Collateral Sub-Account Notice; provided that, before and after giving effect to any transfer pursuant to this clause (B) (other than transfers that are utilized to prepay Advances), (w) the balance of the funds contained in or credited to the Interest Cash Collateral Sub-Account shall not be less than the

 

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amount of any accrued and unpaid interest in respect of the Advances as of the date of such transfer, (x) no Default or Event of Default of the type described in paragraphs (a), (c) (to the extent resulting from a breach of Section 5.04) or (f) of Section 6.01 shall have occurred and be continuing, (y) the Collateral Agent shall not have exercised remedies against the Cash Collateral Account following any Event of Default and (z) the Administrative Agent shall not have accelerated the Advances pursuant to the last paragraph of Section 6.01.

 

(v)           Upon the request of the Borrower at any time pursuant to a Reserve Cash Collateral Sub-Account Notice the Collateral Agent shall transfer to the Borrower Reserve Funds to the extent set forth in such Reserve Cash Collateral Sub-Account Notice; provided that, before and after giving effect to such transfer or transfers (other than transfers that are utilized to prepay Advances), (1) no Default or Event of Default of the type described in paragraphs (a), (c) (to the extent resulting from a breach of Section 5.04) or (f) of Section 6.01 shall have occurred and be continuing, (2) the Administrative Agent shall not have accelerated the Advances pursuant to the last paragraph of Section 6.01, (3) the Collateral Agent shall not have exercised remedies against the Cash Collateral Account following any Event of Default and (4) except in each case to the extent that such funds are utilized to prepay Advances, no Reserve Funds may be transferred from the Reserve Cash Collateral Sub-Account for purposes other than to finance or reimburse itself for financing unfunded commitments, protective participation purchases, protective advances in respect of REO Property and similar funding obligations, in each case solely in respect of the Collateral.

 

(vi)          On each date that the reconciliation statement for the Cash Collateral Account described in Section 5.03(d)(ii) is delivered (or, if a reconciliation statement is not delivered during any calendar month, within seven days of the last day of such calendar month), any and all amounts credited to the Non-Reserve Cash Collateral Sub-Account as of such date shall be transferred by the Collateral Agent to the Administrative Agent to be applied to (i) the prepayment of the Advances and (ii) any other Obligations that are then due and outstanding under the Loan Documents.

 

(vii)         On the date that is the earlier of (A) eighteen (18) months following the Closing Date and (B) the Termination Date, and on the last Business Day of each calendar month thereafter, so long as any Advances or any other Obligation of any Loan Party under any Loan Document shall remain unpaid, any and all amounts contained in or thereafter credited to the Reserve Cash Collateral Sub-Account and the Non-Reserve Cash Collateral-Sub Account as of such date or Business Day shall be transferred by the Collateral Agent to the Administrative Agent to be applied (i) to the prepayment of the Advances and (ii) any other Obligations that are then due and outstanding under the Loan Documents.

 

(viii)        Upon the occurrence and during the continuation of an Event of Default, the Collateral Agent shall at the request, or may with the consent, of the Required Lenders, transfer to the Administrative Agent all amounts deposited in or otherwise credited to the Cash Collateral Account, the Interest Cash Collateral Sub-Account, the Reserve Cash Collateral Sub-Account and the Non-Reserve Cash Collateral Sub-Account, to be applied (i) to the prepayment of the Advances and (ii) any other Obligations that are then due and outstanding under the Loan Documents.

 

(ix)           All prepayments under this Section 2.05(c) shall be made together with accrued interest to the date of such prepayment on the principal amount prepaid, and, if any such prepayment is made on a day other than on the last day of the Interest Period applicable thereto,

 

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such prepayment shall be accompanied by the payment of the amounts required by Section 9.04(c).

 

Section 2.06           Interest .  (a)  Scheduled Interest .  The Borrower shall pay interest on each Advance owing to each Lender from the date of such Advance until such principal amount shall be paid in full, at the following rates per annum:

 

(i)            Base Rate Advances .  During such periods as such Advance is a Base Rate Advance, a rate per annum equal at all times to the sum of (A) the Base Rate in effect from time to time plus (B) the Applicable Margin in effect from time to time, payable quarterly in arrears on the last day of each Fiscal Quarter during such periods and upon repayment of such Advance.

 

(ii)           Eurodollar Rate Advances .  During such periods as such Advance is a Eurodollar Rate Advance, a rate per annum equal at all times during each Interest Period for such Advance to the sum of (A) the Eurodollar Rate for such Interest Period for such Advance plus (B) the Applicable Margin in effect from time to time, payable in arrears on the last Business Day of such Interest Period and on the date such Eurodollar Rate Advance shall be Converted or paid in full.

 

(b)           Default Interest .  The Borrower shall pay interest, (i) (x) upon the occurrence and during the continuance of an Event of Default of the type described in paragraphs (a), (c) (to the extent resulting from a breach of Section 5.04) or (f) of Section 6.01 or (y) upon the acceleration of the Advances by the Administrative Agent pursuant to the last paragraph of Section 6.01, on the unpaid principal amount of each Advance owing to each Lender, payable in arrears on the dates referred to in clause (a) above and on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid on such Advance pursuant to clause (a) above and (ii) to the fullest extent permitted by law, on the amount of any interest, fee or other amount payable hereunder or any other Loan Document that is not paid when due, from the date such amount shall be due until such amount shall be paid in full, payable in arrears on the date such amount shall be paid in full and on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid on Advances pursuant to clause (a)(i) above.

 

(c)           Notice of Interest Rate .  Promptly after receipt of a Notice of Borrowing pursuant to Section 2.02(a), the Administrative Agent shall give notice to the Borrower and each Lender of the interest rate determined by the Administrative Agent for purposes of clause (a) above.

 

Section 2.07           Fees .  The Borrower shall pay to the Administrative Agent for the account of the Lenders (and their respective Affiliates) such fees as may be from time to time agreed in writing among the Borrower and the Lenders (and their respective Affiliates).  The Borrower shall pay to each Agent for its own account such fees as may from time to time be agreed between the Borrower and such Agent, including pursuant to the Fee Letter.

 

Section 2.08           Conversion of Advances .

 

(a)           Optional .  The Borrower may on any Business Day, upon notice given to the Administrative Agent not later than 11:00 A.M. (New York City time) on the third Business Day prior to the date of the proposed Conversion and subject to the provisions of Section 2.09, Convert all or any portion of the Advances of one Type into Advances of the other Type; provided , however , that any Conversion of Eurodollar Rate Advances into Base Rate Advances shall be made only on the last day of an Interest Period for such Eurodollar Rate Advances, any Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in an amount not less than the minimum amount specified in Section 2.02(b), no Conversion of any Advances shall result in more separate Interest Periods than

 

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permitted under Section 2.02(b) and each Conversion of Advances shall be made ratably among the applicable Lenders in accordance with the respective amount of Advances under the Term Facility held by or owed to such Lenders.  Each such notice of Conversion shall, within the restrictions specified above, specify (i) the date of such Conversion, (ii) the Advances to be Converted and (iii) if such Conversion is into Eurodollar Rate Advances, the duration of the initial Interest Period for such Advances.  Each notice of Conversion shall be irrevocable and binding on the Borrower.

 

(b)           Mandatory .

 

(i)            On the date on which the aggregate unpaid principal amount of Eurodollar Rate Advances comprising the Borrowing shall be reduced, by payment or prepayment or otherwise, to less than $5,000,000, such Advances shall, at the end of the applicable Interest Period, automatically Convert into Base Rate Advances.

 

(ii)           If the Borrower shall fail to select the duration of any Interest Period for any Eurodollar Rate Advances in accordance with the provisions contained in the definition of “Interest Period” in Section 1.01, the Administrative Agent will forthwith so notify the Borrower and the applicable Lenders, whereupon each such Eurodollar Rate Advance will automatically, on the last day of the then existing Interest Period therefor, be continued as a Eurodollar Advance having an Interest Period with a one-month duration.

 

(iii)          Upon the occurrence and during the continuance of any Event of Default, (x) each Eurodollar Rate Advance will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance and (y) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended.

 

Section 2.09           Increased Costs, Etc .

 

(a)           If, due to either (i) the introduction of or any change in or in the interpretation of any law or regulation or (ii) the compliance with any guideline or request from any central bank or other governmental authority (whether or not having the force of law), there shall be any increase in the cost to any Lender of agreeing to make or of making, funding or maintaining Eurodollar Rate Advances (excluding, for purposes of this Section 2.09, any such increased costs resulting from all Taxes, Excluded Taxes or Other Taxes (as to which Section 2.11 shall govern), then the Borrower shall from time to time, upon demand by such Lender (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender additional amounts sufficient to compensate such Lender for such increased cost; provided that the Borrower shall not be responsible for costs under this Section 2.09(a) arising more than 180 days prior to receipt by the Borrower of the demand from the affected Lender pursuant to this Section 2.09(a); and provided , further , that a Lender claiming additional amounts under this Section 2.09(a) agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate a different Applicable Lending Office if the making of such a designation would avoid the need for, or reduce the amount of, such increased cost that may thereafter accrue and would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender.  A certificate as to the amount of such increased cost, submitted to the Borrower by such Lender, shall be conclusive and binding for all purposes, absent manifest error.

 

(b)           If any Lender determines that compliance with any law or regulation or any guideline or request from any central bank or other governmental authority (whether or not having the force of law) affects or would affect the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender and that the amount of such capital is increased

 

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by or based upon the existence of such Lender’s commitment to lend hereunder and other commitments of such type, then, upon demand by such Lender or such corporation (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender, from time to time as specified by such Lender, additional amounts sufficient to compensate such Lender in the light of such circumstances, to the extent that such Lender reasonably determines such increase in capital to be allocable to the existence of such Lender’s commitment to lend hereunder; provided , that the Borrower shall not be responsible for costs under this Section 2.09(b) arising more than 180 days prior to receipt by the Borrower of the demand from the affected Lender pursuant to this Section 2.09(b).  A certificate as to such amounts submitted to the Borrower by such Lender shall be conclusive and binding for all purposes, absent manifest error.

 

(c)           If, with respect to any Eurodollar Rate Advances, the Required Lenders notify the Administrative Agent that the Eurodollar Rate for any Interest Period for such Advances will not adequately reflect the cost to such Lenders of making, funding or maintaining their Eurodollar Rate Advances for such Interest Period, the Administrative Agent shall forthwith so notify the Borrower and the Lenders, whereupon (i) each such Eurodollar Rate Advance will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance and (ii) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended until the Administrative Agent shall notify the Borrower that such Lenders have determined that the circumstances causing such suspension no longer exist.

 

(d)           Notwithstanding any other provision of this Agreement, if the introduction of or any change in or in the interpretation of any law or regulation shall make it unlawful, or any central bank or other governmental authority shall assert that it is unlawful, for any Lender or its Eurodollar Lending Office to perform its obligations hereunder to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder, then, on notice thereof and demand therefor by such Lender to the Borrower through the Administrative Agent, (i) each Eurodollar Rate Advance will automatically, upon such demand, Convert into a Base Rate Advance and (ii) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended until the Administrative Agent shall notify the Borrower that such Lender has determined that the circumstances causing such suspension no longer exist; provided , however , that, before making any such demand, such Lender agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate a different Eurodollar Lending Office if the making of such a designation would allow such Lender or its Eurodollar Lending Office to continue to perform its obligations to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate Advances and would not, in the judgment of such Lender, be otherwise disadvantageous to such Lender.

 

Section 2.10           Payments and Computations .

 

(a)           The Borrower shall make each payment hereunder and under the other Loan Documents, irrespective of any right of counterclaim or set-off (except as otherwise provided in Section 2.14), not later than 12:00 noon (New York, New York time) on the day when due (or, in the case of payments made by a Guarantor pursuant to Section 8.01, on the date of demand therefor) in U.S. dollars to the Administrative Agent at the Administrative Agent’s Account in same day funds, with payments being received by the Administrative Agent after such time being deemed to have been received on the next succeeding Business Day.  The Administrative Agent will promptly thereafter cause like funds to be distributed (i) if such payment by the Borrower is in respect of principal, interest, fees or any other Obligation then payable hereunder and under the other Loan Documents to more than one Lender, to such Lenders for the account of their respective Applicable Lending Offices ratably in accordance with the amounts of such respective Obligations then payable to such Lenders and (ii) if such payment by the Borrower is in respect of any Obligation then payable hereunder to one Lender, to

 

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such Lender for the account of its Applicable Lending Office, in each case to be applied in accordance with the terms of this Agreement.  Upon its acceptance of an Assignment and Acceptance and recording of the information contained therein in the Register pursuant to Section 9.07(d), from and after the effective date of such Assignment and Acceptance, the Administrative Agent shall make all payments hereunder and under the other Loan Documents in respect of the interest assigned thereby to the Lender assignee thereunder, and the parties to such Assignment and Acceptance shall make all appropriate adjustments in such payments for periods prior to such effective date directly between themselves.

 

(b)           If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest, fees and expenses then due hereunder, such funds shall be applied (i)  first , toward payment of fees and expenses then due under Sections 2.07 and 9.04, ratably among the parties entitled thereto in accordance with the amounts of fees and expenses then due to such parties, (ii)  second , towards payment of interest and fees then due on account of Advances (including any interest payable pursuant to Section 2.06(b)), ratably among the parties entitled thereto in accordance with the amounts of such interest and fees then due to such parties, and (iii)  third , towards payment of principal of the Advances then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal then due to such parties; provided that the proceeds from the exercise of remedies in respect of any Collateral shall be applied as set forth in the Security Agreement.

 

(c)           All computations of interest based on the Base Rate, of fees shall be made by the Administrative Agent on the basis of a year of 365 or 366 days, as the case may be, and all computations of interest based on the Eurodollar Rate or the Federal Funds Rate shall be made by the Administrative Agent on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest, fees or commissions are payable.  Each determination by the Administrative Agent of an interest rate, fee or commission hereunder shall be conclusive and binding for all purposes, absent manifest error.

 

(d)           Whenever any payment hereunder or under the other Loan Documents shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest or commitment fee, as the case may be; provided , however , that, if such extension would cause payment of interest on or principal of Eurodollar Rate Advances to be made in the next following calendar month, such payment shall be made on the next preceding Business Day.

 

(e)           Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to any Lender hereunder that the Borrower will not make such payment in full, the Administrative Agent may assume that the Borrower has made such payment in full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon such assumption, cause to be distributed to each such Lender on such due date an amount equal to the amount then due such Lender.  If and to the extent the Borrower shall not have so made such payment in full to the Administrative Agent, each such Lender shall repay to the Administrative Agent forthwith on demand such amount distributed to such Lender together with interest thereon, for each day from the date such amount is distributed to such Lender until the date such Lender repays such amount to the Administrative Agent, at the Federal Funds Rate.

 

Section 2.11           Taxes .

 

(a)           Except as otherwise provided herein, any and all payments by any Loan Party to or for the account of any Lender or any Agent hereunder or under any other Loan Document shall be made, in accordance with Section 2.10 or the applicable provisions of such other Loan Document, if

 

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any, free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding, in the case of each Lender and each Agent, (x) taxes, levies, imposts, deductions, charges or withholdings that are imposed on or measured by its overall net income and franchise taxes imposed in lieu thereof by the United States of America or by the state or foreign jurisdiction or any political subdivision thereof under the laws of which such Lender or such Agent, as the case may be, is organized or, in the case of each Lender, such Lender’s Applicable Lending Office is located or (y) any branch profit taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which such Applicable Lending Office is located (all such excluded taxes, levies, imposts, deductions, charges, withholdings being hereinafter referred to as “ Excluded Taxes ”).  If any Loan Party shall be required by law to deduct any taxes, levies, imposts, deductions, charges or withholdings, including any liabilities with respect thereto (other than Excluded Taxes) (“ Taxes ”) from or in respect of any sum payable hereunder or under any other Loan Document to any Lender or any Agent, (i) the sum payable by such Loan Party shall be increased as may be necessary so that after such Loan Party and the Administrative Agent have made all required deductions (including deductions applicable to additional sums payable under this Section 2.11) such Lender or such Agent, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made, (ii) such Loan Party shall make all such deductions and (iii) such Loan Party shall pay the full amount deducted to the relevant taxing authority or other authority in accordance with applicable law; provided , however , that, except to the extent that such Lender’s assignor (if any) was entitled, at the time of assignment, to receive additional amounts from such Loan Party pursuant to this paragraph, such Loan Party shall not be required to increase the amounts payable to any Lender with respect to any Taxes (1) that are attributable to such Lender’s failure to comply with the requirements of paragraph (e) of this Section (other than if such failure is due to a change in law, or in the interpretation or application thereof, occurring after the date on which the relevant form, certificate or other document originally was required to be provided) or (2) that are United States withholding taxes imposed on amounts payable to such Lender at the time such Lender becomes a party to this Agreement.

 

(b)           In addition, each Loan Party shall pay any present or future stamp, documentary, excise, property, intangible, mortgage recording or similar taxes, charges or levies that arise from any payment made by such Loan Party hereunder or under any other Loan Documents or from the execution, delivery or registration of, performance under, or otherwise with respect to, this Agreement or the other Loan Documents (hereinafter referred to as “ Other Taxes ”).

 

(c)           Except as otherwise provided herein, if any Loan Party fails to pay any Taxes or Other Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other required documentary evidence, the Loan Parties shall indemnify each Lender and each Agent for and hold them harmless against any taxes, interest or penalties and any liability (including penalties, additions to tax, interest and reasonable expenses) arising from or with respect to such failure, but excluding penalties, interest or other expenses to the extent attributable to the gross negligence or willful misconduct of the Person claiming such indemnity.  This indemnification shall be made within 30 days from the date such Lender or such Agent (as the case may be) makes written demand therefor, which written demand shall be accompanied by copies of the applicable documentation evidencing the amount of such taxes.

 

(d)           Within 30 days after the date of any payment of Taxes, the appropriate Loan Party shall furnish to the Administrative Agent, at its address referred to in Section 9.02, the original or a certified copy of a receipt evidencing such payment, to the extent such a receipt is issued therefor, or other written proof of payment thereof that is reasonably satisfactory to the Administrative Agent.  For purposes of subsections (d) and (e) of this Section 2.11, the terms “United States person” shall have the meanings specified in Section 7701 of the Internal Revenue Code.

 

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(e)                                   Each Lender that is not a United States person (a “ Non-U.S. Lender ”) shall, on or prior to the date of its execution and delivery of this Agreement in the case of each Initial Lender, on the date of the Assignment and Acceptance pursuant to which it becomes a Lender in the case of each other Lender (or, in the case of a participation, on or prior to the date on which such participant purchases the participation), and at the time or times prescribed by applicable law, or from time to time thereafter as reasonably requested in writing by the Borrower (but only so long as such Lender remains lawfully able to do so), provide each of the Administrative Agent and Borrower with two original properly completed Internal Revenue Service Forms W-8BEN, W-8IMY or W-8ECI, as appropriate, or any successor or other form prescribed by the Internal Revenue Service, certifying that such Non-U.S. Lender is exempt from or entitled to a reduced rate of United States withholding tax on payments pursuant to this Agreement or the other Loan Documents or, in the case of a Non-U.S. Lender that is relying on the portfolio interest exemption, certifying that such Non-U.S. Lender is a foreign corporation, partnership, estate or trust.  In addition, each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Non-U.S. Lender (provided that such Non-U.S. Lender remains lawfully able to do so).  Each Non-U.S. Lender shall promptly notify the Borrower at any time it determines that it is no longer in a position to provide any previously delivered certificate to the Borrower (or any other form of certification adopted by the U.S. taxing authorities for such purpose).  If the forms provided by a Non-U.S. Lender at the time such Non-U.S. Lender first becomes a party to this Agreement indicate a United States interest withholding tax rate in excess of zero, withholding tax at such rate shall be considered excluded from Taxes unless and until such Non-U.S. Lender provides the appropriate properly completed and executed forms to the Borrower (with a copy to the Administrative Agent) certifying that a lesser rate applies, whereupon withholding tax at such lesser rate only shall be considered excluded from Taxes for periods governed by such forms; provided , however , that if, at the effective date of the Assignment and Acceptance pursuant to which a Non-U.S. Lender becomes a party to this Agreement (or, in the case of a participation, the date on which the participant purchases the participation), the Non-U.S. Lender assignor (or, in the case of a participation, the Non-U.S. Lender seller) was entitled to payments under Section 2.11(a) in respect of United States withholding tax with respect to interest paid at such date, then, to such extent, the term Taxes shall include (in addition to withholding taxes that may be imposed in the future or other amounts otherwise includable in Taxes) United States withholding tax, if any, applicable with respect to the participant or Non-U.S. Lender assignee on such date.  Each Lender that is a United States person (other than persons who are corporations or otherwise exempt from United States backup withholding tax) shall, at the time such Lender becomes a party to this Agreement (or, in the case of a participation, on or before the date on which the participant purchases the participation) or at such time (or times) reasonably requested by the Borrower, deliver to the Borrower a properly completed and duly executed U.S. Internal Revenue Service Form W-9 or any successor form certifying that such person is exempt from United States backup withholding tax on payments made hereunder.  If any form or document referred to in this Section 2.11(e) requires the disclosure of information, other than information necessary to compute the tax payable and information required on the date hereof by Internal Revenue Service Form W-8BEN, W-8IMY, W-8ECI, W-9 or any successor, or the related certificate described above, that the applicable Lender reasonably considers to be confidential, such Lender shall give notice thereof to the Borrower and shall not be obligated to include in such form or document such confidential information.

 

(f)                                     If the Administrative Agent or any Lender determines, in its sole discretion, that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified by any Loan Party or with respect to which such Loan Party has paid additional amounts pursuant to this Section 2.11, it shall pay over such refund to the Borrower, net of all out-of-pocket expenses of the Administrative Agent or such Lender and without Interest (other than any interest paid by the relevant governmental authority with respect to such refund); provided , that the Borrower, upon the request of the Administrative Agent or such Lender, agrees to repay the amount paid over to the Borrower (plus

 

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any penalties, interest, or other charges imposed by the relevant governmental authority) to the Administrative Agent or such Lender in the event the Administrative Agent or such Lender is required to repay such refund to such governmental authority.  This paragraph shall not be construed to require the Administrative Agent or any Lender to make available its tax returns (or any other information relating to its taxes which it deems confidential) to the Borrower or any other Person.

 

Section 2.12                                 Sharing of Payments, Etc .  If any Lender shall obtain at any time any payment, whether voluntary, involuntary, through the exercise of any right of set off, or otherwise (other than pursuant to Section 2.09, 2.11 or 9.04), (a) on account of Obligations due and payable to such Lender hereunder and under the other Loan Documents at such time in excess of its ratable share (according to the proportion of (i) the amount of such Obligations due and payable to such Lender at such time (other than pursuant to Section 2.09, 2.11 or 9.04) to (ii) the aggregate amount of the Obligations due and payable to all Lenders hereunder and under the other Loan Documents at such time) of payments on account of the Obligations due and payable to all Lenders hereunder (other than pursuant to Section 2.09, 2.11 or 9.04) and under the other Loan Documents at such time obtained by all the Lenders at such time or (b) on account of Obligations owing (but not due and payable) to such Lender hereunder and under the other Loan Documents at such time (other than pursuant to Section 2.09, 2.11 or 9.04) in excess of its ratable share (according to the proportion of (i) the amount of such Obligations owing to such Lender at such time (other than pursuant to Section 2.09, 2.11 or 9.04) to (ii) the aggregate amount of the Obligations owing (but not due and payable) to all Lenders hereunder and under the other Loan Documents at such time) of payments on account of the Obligations owing (but not due and payable) to all Lenders hereunder (other than pursuant to Section 2.09, 2.11 or 9.04) and under the other Loan Documents at such time obtained by all of the Lenders at such time, such Lender shall forthwith purchase from the other Lenders such interests or participating interests in the Obligations due and payable or owing to them, as the case may be, as shall be necessary to cause such purchasing Lender to share the excess payment ratably with each of them; provided , however , that, if all or any portion of such excess payment is thereafter recovered from such purchasing Lender, such purchase from each other Lender shall be rescinded and such other Lender shall repay to the purchasing Lender the purchase price to the extent of such Lender’s ratable share (according to the proportion of (i) the purchase price paid to such Lender to (ii) the aggregate purchase price paid to all Lenders) of such recovery together with an amount equal to such Lender’s ratable share (according to the proportion of (i) the amount of such other Lender’s required repayment to (ii) the total amount so recovered from the purchasing Lender) of any interest or other amount paid or payable by the purchasing Lender in respect of the total amount so recovered.  The Borrower agrees that any Lender so purchasing an interest or participating interest from another Lender pursuant to this Section 2.12 may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off) with respect to such interest or participating interest, as the case may be, as fully as if such L