================================================================================
TORTOISE CAPITAL RESOURCES CORPORATION
--------
$20,000,000
CREDIT AGREEMENT
Dated as of April 23, 2007
--------
U.S. BANK NATIONAL ASSOCIATION, as Agent
================================================================================
Table of Contents
Section 1
General
Definitions.................................................1
1.1
Definitions
..................................................1
1.2
Accounting and Other Terms
...................................7
1.3
General Rules
................................................8
Section 2
Credit
Facility.....................................................8
2.1
Total Credit Facility
........................................8
2.2
Revolving Credit Loans
.......................................8
2.3
Swingline Loans
..............................................9
2.4
Reduction and Changes of Commitments
........................10
2.5
Pro Rata Treatment
..........................................10
Section 3
Finance Charges, Repayment and Other
Terms.........................11
3.1
Interest Rate
...............................................11
3.2
Payments of Principal, Interest and Costs
...................12
3.3
Voluntary Prepayments
.......................................12
3.4
Mandatory Prepayments
.......................................13
3.5
Method of Payment
...........................................13
3.6
Use of Proceeds
.............................................13
3.7
Notice and Manner of Borrowing
..............................14
3.8
Minimum Amount
..............................................14
3.9
Capital Adequacy
............................................14
3.10
Application of Payments and Collections
.....................15
3.11
Periodic Statement
..........................................15
3.12
Non-Receipt of Funds by Agent
...............................15
3.13
Several Obligations
.........................................15
3.14
Benefits of Collateral
......................................15
3.15
Proceeds from Collateral
....................................16
3.16
Balance; Sharing of Payments
................................16
3.17
Libor Loan Provisions
.......................................17
Section 4
Lending
Conditions.................................................17
4.1
Credit Documents
............................................17
4.2
Additional Conditions Precedent to Initial Loans
............19
4.3
Conditions Precedent to All Loans
...........................19
Section 5
Representations and
Warranties.....................................20
5.1
Representations, Warranties and Covenants of the Borrower
...20
Section 6
Covenants..........................................................22
i
6.1
Affirmative Covenants
.......................................22
6.2
Negative Covenants
..........................................25
Section 7
Events of
Default..................................................27
7.1
Events of Default
...........................................27
7.2
Obligation to Lend; Acceleration
............................28
7.3
Remedies
....................................................28
7.4
Right of Set-off
............................................29
Section 8
Agency
Provisions..................................................29
8.1
Appointment, Powers and Immunities
..........................29
8.2
Reliance by Agent
...........................................30
8.3
Defaults
....................................................30
8.4
Rights as a Bank
............................................30
8.5
Indemnification
.............................................30
8.6
Non-Reliance on Agent and other Banks
.......................31
8.7
Failure to Act
..............................................31
8.8
Resignation or Removal of Agent
.............................31
8.9
Designee and Delegatee
......................................31
8.10
Representation of Banks
.....................................32
8.11
Obligations Several
.........................................32
Section 9
Miscellaneous......................................................32
9.1
Notices
.....................................................32
9.2
Power of Attorney
...........................................32
9.3
Reimbursement of Expenses
...................................33
9.4
Indemnity
...................................................33
9.5
Entire Agreement; Modification of Agreement; Sale of
Interest
....................................................33
9.6
Indulgences Not Waivers
.....................................34
9.7
Severability
................................................34
9.8
Successors and Assigns
......................................34
9.9
General Waivers by Borrower
.................................35
9.10
Execution in Counterparts; Facsimile Signatures
.............35
9.11
Captions
....................................................35
9.12
USA Patriot Act Notice
......................................35
9.13
Governing Law; Consent to Forum
.............................35
9.14
Waiver of Jury Trial; Limitation on Damages
.................36
9.15
Controlling Document
........................................36
9.16
K.S.A. ss.16-118 Required Notice
............................37
ii
Table of Exhibits
Exhibit A - Commitments
Exhibit B - Form of Revolving Credit Note
Exhibit C - Form of Swingline Note
Exhibit D - Form of Borrowing Base Certificate
iii
CREDIT AGREEMENT
This Credit
Agreement (the
"
Agreement
")
is made as of April 23, 2007, by
and among TORTOISE CAPITAL RESOURCES
CORPORATION,
a Maryland
corporation (the
"
Borrower
");
U.S. BANK NATIONAL
ASSOCIATION,
a national banking
association,
BANK OF OKLAHOMA,
N.A., a national banking
association,
and each other lender
from time to time
identified as having a Commitment on Exhibit A hereto and who
becomes a party hereto (each a "
Bank
" and, collectively, the "
Banks
"); U.S. BANK
NATIONAL
ASSOCIATION,
a
national
banking
association,
as
the
lender
for
Swingline Loans (in such capacity,
the "
Swingline Lender
");
U.S. BANK NATIONAL
ASSOCIATION,
a national banking
association,
as agent for the Banks hereunder
(in
such
capacity,
the
"
Agent
");
and as lead
arranger
hereunder
(in such
capacity, the "
Lead Arranger
").
The parties agree as follows:
Section 1
General Definitions
1.1
Definitions
. When used in this Agreement, the following terms have the
following meanings:
"
1940
Act
" means the
Investment
Company
Act of 1940,
and the rules and
regulations
promulgated
thereunder,
as the same may be
amended
from time to
time.
"
Affiliate
"
means a Person (1) which owns or otherwise
has an interest in
five percent or more of any equity interest of the Borrower, (2)
five percent or
more of the equity
interests of which the Borrower (or any shareholder or other
equity holder, director,
officer, employee or subsidiary of the Borrower or any
combination
thereof)
owns or
otherwise
has an
interest
in,
or (3)
which,
directly or through one or more intermediaries,
is controlled by, controls,
or
is under common
control with the
Borrower.
For purposes of subpart (3) above,
"control" means the ability, directly or indirectly, to affect the
management or
policies of a Person by virtue of an ownership interest, by right
of contract or
any other means.
"
Agreement
" means this Credit
Agreement,
as amended,
renewed,
restated,
replaced, consolidated or otherwise modified from time to time.
"
Banks
"
shall
have the
meaning
given to such
term in the
introductory
paragraph
hereof and shall
include the Swingline
Lender.
The term shall also
include any assignee of a Bank under Section 9.5.
"
Borrowing Base
Certificate
"
means a certificate,
in favor of the Agent,
signed by an authorized
officer of the Borrower,
substantially
in the form of
Exhibit D hereto, or in such other form as the Agent may reasonably
request from
time to time, which sets forth in reasonable
detail the computations
necessary
to determine the Borrowing Base at a particular time.
"
Borrowing
Base
"
means,
at any date,
an amount
equal to (1) 25% of the
value of the total
assets of the
Borrower
(such amount shall also include any
Loan
requested
on such date),
less (2) all
outstanding
other
senior
debt;
provided,
however,
such
senior
debt shall not
include
the Loans under this
Agreement.
"
Business Day
" means any day on which
commercial
banks are not authorized
or required to close in Kansas City, Missouri.
"
Central
Time
" means the time as in effect in the central time zone in the
United States from time to time.
Credit Agreement - Page 1
"
Change in Control
"
shall be deemed to have
occurred if (1) any Person or
group
of
Persons
acting
in
concert
shall
own,
directly
or
indirectly,
beneficially or of record,
shares
representing
more than 50% of the aggregate
ordinary voting power represented by the issued and outstanding
capital stock of
the
Borrower;
or (2) a change
shall
occur in the Board of
Directors
of the
Borrower such that the individuals who constituted the Board of
Directors of the
Borrower as of the Closing Date cease for any reason to constitute
a majority of
the directors of the Borrower then in office.
"
Closing
Date
"
means
the
date of this
Agreement
as set
forth
in the
introductory paragraph of this Agreement.
"
Collateral
"
means
all
property
with
respect
to which a Lien has been
granted to or for the benefit of the Banks pursuant to the Security
Agreement or
any of the other
Credit
Documents
or which
otherwise
secures the payment or
performance of any Obligation.
"
Commitments
" means, as to each Bank, at any date, without duplication, its
Revolving Credit Loan Commitment and its Swingline
Exposure,
all at such date;
provided,
however,
that,
in the case of the Swingline
Lender
(solely in its
capacity as the Swingline Lender), its Commitments shall mean its
Swingline Loan
Commitment.
"
Control
Agreement
"
means the
Securities
Account
Control
Agreement or
similar
control
agreement
to be
executed
by the
Borrower,
the
Securities
Intermediary
and the
Agent
on or about
the
Closing
Date
and by which
the
Securities
Intermediary
shall acknowledge that it will comply with entitlement
orders
originated by the Bank without further
consent by the Borrower,
as the
same may be amended,
renewed,
replaced,
restated,
consolidated
or otherwise
modified from time to time.
"
Credit
Documents
"
means,
collectively,
this Agreement,
the Notes, the
Security Agreement,
the Control Agreement and any other agreements or documents
with the Agent or the Banks existing on or after the Closing Date
evidencing or
otherwise
relating to any of the
transactions
described in or contemplated by
this
Agreement,
and
any
amendments,
renewals,
restatements,
replacements,
consolidations or other modifications of any of the foregoing from
time to time.
"
Daily
Reset Libor
Rate
"
means an annual
rate of interest
equal to the
one-month LIBOR rate for Dollars quoted by the Agent from Reuters
Screen LIBOR01
Page (or, any successor or substitute
thereto selected by the Agent in its sole
discretion),
which shall be that one-month
LIBOR rate in effect and reset each
Business Day,
adjusted for any reserve
requirement
and any
subsequent
costs
arising from a change in government regulation.
"
Debt
"
means any of the
following:
(1)
indebtedness
or
liability
for
borrowed money; (2) obligations evidenced by bonds,
debentures,
notes or other
similar instruments; (3) obligations for the deferred purchase
price of property
or
services;
(4)
obligations
as lessee
under
capital
leases;
(5) current
liabilities in respect of unfunded vested benefits under Plans
covered by ERISA;
(6)
obligations
under
letters
of credit or
acceptance
facilities;
(7) all
guarantees,
endorsements
(other than for collection or deposit in the ordinary
course of business) and other
contingent
obligations
to purchase,
to provide
funds for
payment,
to supply
funds to invest in any Person,
or
otherwise to
assure a creditor against loss; and (8) obligations
secured by a Lien,
whether
or not the obligations have been assumed.
"
Default
Rate
"
has
the
meaning
provided
in
Section
3.1(b)
of
this
Agreement.
"
Default
"
means an event or condition the occurrence of which would,
with
the lapse of time or the giving of notice or both, become an Event
of Default.
Credit Agreement - Page 2
"
Dollars
" and "
$
" means lawful money of the United States of America.
"
Environmental
Laws
" means all federal,
state, local and other applicable
statutes, ordinances, rules, regulations, judicial orders or
decrees, common law
theories of liability,
governmental or quasi-governmental directives or notices
or other laws or matters
existing on or after the Closing Date
relating in any
respect to occupational safety, health or environmental protection.
"
ERISA
"
means the Employee
Retirement
Income
Security
Act of 1974,
as
amended
from
time to time,
and all rules
and
regulations
from time to time
promulgated thereunder.
"
Eurocurrency
Reserve
Requirement
"
means,
for any Loan for any Interest
Period
therefor,
the daily average of the stated maximum rate
(expressed as a
decimal) at which reserves
(including any marginal,
supplemental
or emergency
reserves)
are
required to be
maintained
during such
Interest
Period
under
Regulation D by member banks of the Federal Reserve System in New
York City with
deposits
exceeding one billion dollars against
"Eurocurrency
liabilities" (as
such term is used in Regulation
D) but without
benefit or credit of proration,
exemptions or offsets that might
otherwise be available from time to time under
Regulation D. Without
limiting the effect of the
foregoing,
the
Eurocurrency
Reserve
Requirement
shall reflect any other reserves required to be maintained
against (1) any category of liabilities
that includes
deposits by reference to
which
the
Libor
Rate
or the
Daily
Reset
Libor
Rate
for
Loans
is to be
determined,
or (2) any
category of
extension
of credit or other
assets that
include
Loans for which the interest rate is determined on the basis of a
Libor
Rate or a Daily Reset Libor Rate.
"
Event
of
Default
"
has
the
meaning
provided
in
Section
7.1 of this
Agreement.
"
Funded Debt
" means Debt of the Borrower of the type
described in subparts
(1), (2),
(3), (4) and (6) of the
definition of "Debt" in this Section 1.1 and
includes, in any event, the Loans.
"
GAAP
" means generally accepted
accounting
principles in effect from time
to time in the United States of America.
"
Governmental Authority
" means any nation or government, any state or other
political subdivision thereof, and any branch,
department or agency thereof, or
any other entity
exercising
executive,
legislative,
judicial,
regulatory or
administrative functions of or pertaining to a government.
"
Hazardous
Substance
" means any hazardous,
toxic,
dangerous or otherwise
environmentally unsound substance, waste or other material, in
whatever form, as
defined or described in, or contemplated by, any Environmental Law
and any other
hazardous,
toxic,
dangerous or otherwise
environmentally
unsound
substance,
waste or other material in whatever form, or any other substance,
waste or other
material regulated by any Environmental Law.
"
Interest Period
" means, with respect to any Loan in which interest accrues
at a Libor Rate, the period
commencing on the date such Loan is made and ending
on the
numerically
corresponding
day in the
first,
second,
third
or sixth
calendar month thereafter,
except,
that each Interest Period that commences on
the last
Business Day of a calendar
month (or on any day for which there is no
numerically
corresponding
day in the
appropriate
subsequent
calendar month)
shall end on the last Business Day of the appropriate subsequent
calendar month;
provided, however,
that (a) no Interest Period may extend beyond the Termination
Date,
and (b) if an Interest
Period
would end on a day that is not a Business
Day, such Interest Period shall be extended to the next Business
Day unless such
Business Day would fall in the next calendar month, in which event
such Interest
Period shall end on the immediately preceding Business Day.
Credit Agreement - Page 3
"
Investment
Advisor
"
means any person
(other
than a bona fide
officer,
director,
trustee, member of an advisory board, or employee of the Borrower,
as
such) who, pursuant to contract with the Borrower, regularly
furnishes advice to
the Borrower with respect to the
desirability
of investing
in,
purchasing or
selling
securities
or
other
property,
or is
empowered
to
determine
what
securities or other property shall be purchased or sold by the
Borrower.
"
Libor Rate
" means, for any Interest Period,
the rate per annum determined
by the Agent to equal the quotient of (1) the London interbank
offered rate for
Dollars
for such
Interest
Period,
as quoted two
Business
Days
immediately
preceding the date of the proposed
Libor Loan in the "Money
Rates"
section of
The Wall Street
Journal or, if not
available,
by
Bloomberg,
Telerate or any
other
financial news services
(electronic or otherwise) used by the Agent from
time to time in accordance
with
commercially
reasonable
industry
standards,
divided by
(2) one minus the Eurocurrency
Reserve Requirement for such Interest
Period.
"
Lien
"
means any
mortgage,
deed of
trust,
pledge,
security
interest,
hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or
other),
or preference,
priority,
or other security
agreement or preferential
arrangement, charge or encumbrance of any kind or nature
whatsoever,
including,
without limitation, any conditional sale or other title retention
agreement, any
financing
lease having
substantially
the same
economic
effect as any of the
foregoing, or the filing of any financing statement under the
Uniform Commercial
Code or comparable law of any jurisdiction to evidence any of the
foregoing.
"
Loans
" means all Revolving
Credit Loans and the Swingline Loans. The term
"Loan"
may
refer
to all
Revolving
Credit
Loans
or
Swingline
Loans
then
outstanding or, as the context so requires, any particular
Revolving Credit Loan
or Swingline Loan then outstanding under this Agreement.
"
Mandatory Prepayments
" shall mean the prepayments of the Loans required by
Section 3.5 hereof.
"
Material
Adverse
Effect
"
means
(1) a
material
adverse
effect on the
assets,
liabilities,
business,
prospects,
operations,
income or
condition,
financial
or
otherwise,
of the
Borrower,
(2) a material
impairment
of the
ability of the
Borrower to pay,
perform or observe its
obligations
under the
Credit
Documents,
or
(3) a
material
impairment
of
the
enforceability
or
availability
of the rights or remedies
stated to be
available to the Agent or
any Bank under the Credit Documents.
"
Notes
" means,
collectively,
the Revolving Credit Notes and the Swingline
Note.
"
Obligations
" means all Loans and all other advances,
debts,
liabilities,
obligations,
covenants
and duties
owing,
arising,
due or
payable
from the
Borrower
to the Agent or any Bank of any kind or
nature,
existing
or future,
whether
or not
evidenced
by any note,
letter of
credit,
guaranty
or other
instrument,
whether
arising
under this
Agreement
or any of the other Credit
Documents
or
otherwise
and
whether
direct or indirect
(including,
without
limitation,
those acquired by assignment),
absolute or contingent,
primary or
secondary,
due or to become
due,
existing
on or after the
Closing
Date and
however acquired, and all amendments,
renewals,
restatements,
replacements or
other
modifications
of the
foregoing
from time to time.
The term
includes,
without limitation,
all principal,
interest, fees, expenses and any other sums
chargeable to the Borrower under any of the Credit Documents.
"
Permitted Debt
" means any of the following: (1) accrued expenses and trade
account payables incurred in the ordinary course of the Borrower's
business; (2)
Debt to the
Agent
and the
Banks
under
this
Agreement;
(3)
interest
rate
protection
agreements;
and (4) other Debt
approved in advance by the Required
Banks in a writing delivered to the Borrower.
Credit Agreement - Page 4
"
Permitted
Liens
"
means
any of
the
following:
(1)
Liens
for
taxes,
assessments or
governmental
charges not delinquent or being
contested in good
faith
and by
appropriate
proceedings
and
for
which
adequate
reserves
in
accordance with GAAP are maintained on the Borrower's
books;
(2) Liens arising
out
of
deposits
in
connection
with
workers'
compensation,
unemployment
insurance,
old age pensions or other
social
security or
retirement
benefits
legislation;
(3) deposits or pledges to secure bids, tenders,
contracts (other
than contracts for the payment of money), leases, statutory
obligations,
surety
and appeal bonds,
and other
obligations of like nature arising in the ordinary
course of the Borrower's business; (4) Liens imposed by law, such
as mechanics',
workers', materialmen's,
carriers' or other like Liens (excluding, however, any
Lien in favor of a landlord)
arising in the ordinary
course of the
Borrower's
business which secure the payment of obligations which are not past
due or which
are being diligently contested in good faith by appropriate
proceedings and for
which adequate reserves in accordance with GAAP are maintained on
the Borrower's
books;
(5)
rights
of
way,
zoning
restrictions,
easements
and
similar
encumbrances
affecting the
Borrower's
real property
which do not
materially
interfere with the use of such property; and (6) Liens in favor of
the Agent and
the Banks.
"
Person
"
means an
individual,
corporation,
limited
liability
company,
partnership,
trust,
governmental
entity or any other entity,
organization or
group whatsoever.
"
Plan
" means an employee benefit plan (as defined in Section 3(3) of
ERISA)
maintained for employees of the Borrower on or after the Closing
Date.
"
Post-Resting Period
" has the meaning provided in Section 2.2(a)(2) of this
Agreement.
"
Prime
Rate
"
means a basis on which the rate of
interest is from time to
time calculated for loans making reference
thereto,
and may not be the lowest,
best or most
favored
of the
interest
rates
offered
by U.S.
Bank
National
Association.
"
Pro-Rata
Share
" means,
at any date, with respect to a Bank, in each case
expressed as a percentage (rounded to 12 decimal places, or such
other number of
decimal places as the Agent,
acting in a commercially
reasonable
manner,
may
select from time to time):
(1)
Make Revolving
Credit Loans.
In the case of a Bank's
obligation
to make Revolving Credit Loans, a fraction:
(a) the numerator of
which
is
the
amount
of
such
Bank's
Revolving
Credit
Loan
Commitment on such date, and (b) the
denominator of which is the
aggregate
amount of all Banks' Revolving Credit Loan Commitments
on such date.
(2)
Swingline
Exposure.
In
the
case
of a
Bank's
obligation
to
reimburse the Swingline
Lender for Swingline
Loans, a fraction:
(a) the numerator of which is the amount of such Bank's Revolving
Credit Loan
Commitment on such date, and (b) the
denominator of
which is the aggregate amount of all Banks' Revolving Credit Loan
Commitments on such date.
(3)
Receive
Principal or Interest.
In the case of a Bank's right to
receive
payments of principal
and interest
with respect to its
outstanding
Revolving Credit Loans (including any such Revolving
Credit Loans arising out of Swingline Loans), a fraction: (a) the
numerator of which is the aggregate
unpaid
principal
amount of
such
Bank's
Loans
giving
rise to such
principal
or interest
payment on such
date,
and (b) the
denominator
of which is the
aggregate unpaid principal amount of all Banks' Loans giving rise
to such principal or interest payment on such date.
Credit Agreement - Page 5
(4)
Receive
Shared
Fees.
In the case of a Bank's
right to receive
payments
with
respect
to
Shared
Fees,
a
fraction:
(a) the
numerator of which is the aggregate
unpaid
principal
amount of
such
Bank's
Revolving
Credit
Loans on such date,
and (b) the
denominator of which is the aggregate
unpaid principal amount of
all Banks' Revolving Credit Loans on such date.
(5)
Indemnification; Other.
In the case of a Bank's obligations under
Section
8.5
hereof,
or in any
other
case
not
addressed
in
subparts (1) through (4) above, a fraction:
(a) the numerator of
which
is
the
amount
of
such
Bank's
Revolving
Credit
Loan
Commitment,
and (b) the
denominator
of which is the
aggregate
amount of all
Banks'
Revolving
Credit
Loan
Commitments
(the
foregoing
fraction shall be calculated without regard to whether
such Bank or any other Bank has any
commitment to make Revolving
Credit Loans on such date).
"
Regulation D
" means
Regulation D of the Board of Governors of the Federal
Reserve System as amended or supplemented from time to time.
"
Regulatory
Change
"
means any change
after the Closing
Date in federal,
state,
local or foreign laws or
regulations
(including,
without
limitation,
Regulation D, but,
subject to the
Borrower's
obligations
otherwise
provided
herein, not including a change in the Eurocurrency Reserve
Requirement),
or the
adoption
or
making
after
such
date of any
interpretations,
directives
or
requirements applying to a class of banks including the Agent
and/or Banks under
any federal,
state, local or foreign laws or regulations (whether or not having
the force of law) by any court or
governmental
or monetary
authority
charged
with the interpretation or administration thereof.
"
Required Banks
" shall mean, at any date, one or more Banks having at least
66-2/3% of the Commitments on such date;
provided, however,
so long as there are
three Banks or less under this Agreement with Revolving Credit Loan
Commitments,
"Required
Banks"
shall
mean one or more
Banks
having
at least
100% of the
Commitments on such date.
"
Resting
Period
" has the meaning
provided
in Section
2.2(a)(1)
of this
Agreement.
"
Revolving
Credit Loan Commitment
"
means, as to each Bank, its obligation
to make
Revolving
Credit
Loans
under
Section
2.2
hereof
in an
aggregate
principal
amount at any time
outstanding
not to exceed
the
amount set forth
opposite
such
Bank's
name on
Exhibit
A
hereto
under
the
column
entitled
"Revolving Credit Loan Commitment Amount."
"
Revolving Credit Loans
" has the meaning provided in Section 2.2(a) of this
Agreement.
"
Revolving
Credit Note
" has the meaning provided in Section 2.2(b) of this
Agreement.
"
Securities
Account
" means
securities
account number 19-9236 held at the
Securities Intermediary.
"
Securities
Intermediary
"
means
U.S.
Bank
National
Association.
"
Security
Agreement
"
means the
Security
Agreement to be executed by the
Borrower on or about the Closing Date in favor of the Agent and the
Banks and by
which the Borrower
shall grant to the Agent and the Banks,
as security for the
Obligations,
a security
interest in all of the Borrower's
presently
owned or
hereafter acquired assets,
including without limitation,
all of the Borrower's
investment
assets,
Credit Agreement - Page 6
investment property, and all instruments,
accounts and general intangibles,
as
the same may be amended, renewed, replaced, restated,
consolidated or otherwise
modified from time to time.
"
Shared Fee
" means the Late Fee
provided in Section
3.1(c) and the Unused
Line Fee provided in Section 3.1(d) of this Agreement .
"
Swingline
Exposure
"
means,
at any date,
with respect to any Bank,
its
Pro-Rata Share of the
outstanding
principal
amount of Swingline Loans on such
date.
"
Swingline
Lender
" has the meaning given to such term in the
introductory
paragraph hereof.
"
Swingline
Loan
Commitment
"
means,
as
to
the
Swingline
Lender,
its
obligation
to make
Swingline
Loans
pursuant
to Section
2.3
hereof,
in an
aggregate
principal amount outstanding at any time not to exceed the amount
set
forth
opposite
such Bank's name on Exhibit A hereto under the column
entitled
"Swingline Loan Commitment Amount."
"
Swingline
Loans
"
has the
meaning
provided
in
Section
2.3(a) of this
Agreement.
"
Swingline
Note
"
has the
meaning
provided
in
Section
2.3(b)
of this
Agreement.
"
Termination Date
" means March 21, 2008.
"
UCC
" means the Uniform Commercial Code as in effect in the State of
Kansas
from time to time.
1.2
Accounting and Other Terms
.
(a)
General
.
All
accounting
terms not
specifically
defined herein
shall be construed in accordance with GAAP.
Unless the context clearly requires
otherwise, all references to "dollars" or "$" are to United States
dollars. This
Agreement and the other Credit
Documents
shall be construed
without regard to
any
presumption
or rule requiring
construction
against the party causing any
such
document
or any
portion
thereof to be
drafted.
The
Section and other
headings in this
Agreement and any index at the beginning of this Agreement are
for convenience of reference only and shall not limit or otherwise
affect any of
the terms of this Agreement.
Similarly,
any page footers or headers or similar
word processing,
document or page
identification
numbers in this Agreement or
any index or exhibit are for
convenience
of reference only and shall not limit
or otherwise
affect any of the terms of this Agreement,
nor shall there be any
requirement
that any such footers or other numbers be
consistent
from page to
page. Unless the context clearly requires otherwise,
any reference to a Section
of this Agreement refers to all Sections and Subsections
thereunder. Any pronoun
used herein
shall be deemed to cover all
genders.
Defined
terms used in this
Agreement may be set forth in Section 1.1 or other
Sections of this
Agreement,
and all such
definitions
defined in the
singular
shall have a
corresponding
meaning when used in the plural and vice versa.
(b)
Changes in GAAP
.
If at any time any change in GAAP would
affect
the
computation of any financial
ratio or requirement
set forth in any Credit
Document,
and either the Borrower or the Agent shall so request,
the Agent and
the Borrower shall negotiate in good faith to amend such ratio or
requirement to
preserve the original intent thereof in light of such change in
GAAP;
provided,
however,
that, until so amended, (1) such ratio or requirement shall
continue to
be computed in accordance
with GAAP prior to such change
therein,
and (2) the
Borrower shall provide to the Agent
financial
statements
and other
documents
required under this Agreement or as reasonably requested
Credit Agreement - Page 7
hereunder setting forth a reconciliation
between
calculations of such ratio or
requirement made before and after giving effect to such change in
GAAP.
1.3
General Rules
. For the purposes of this Agreement, the words "herein,"
"hereof,"
"hereunder"
and words of similar import refer to this Agreement as a
whole and not to a particular
section,
paragraph or other
subdivision.
Terms
defined in the singular have a corresponding meaning when used in
the plural and
vice versa.
Similarly,
verbs defined in one tense have a corresponding meaning
when used in another tense.
Section 2
Credit Facility
2.1
Total Credit
Facility
.
Each Bank
severally
agrees,
subject to the
terms and conditions of this Agreement, to make a total credit
facility of up to
$20,000,000
available to the Borrower upon its request therefor, as provided in
this Section 2.
2.2
Revolving Credit Loans
.
(a)
General
.
Each Bank
severally
agrees,
subject to the terms and
conditions of this Agreement,
to make revolving credit loans ("
Revolving Credit
Loans
") to the Borrower from time to time in the following amounts:
(1)
during the period of time (the
"
Resting
Period
")
from the
Closing Date through and including June 7, 2007, neither the
Agent nor any Bank
shall be
obligated
whatsoever
to make
Revolving Credit Loans to the Borrower; and
(2)
during the period of time (the
"
Post-Resting
Period
") from
June
8,
2007
through
and
including
the
Business
Day
immediately
before the
Termination
Date,
in an aggregate
principal
amount at any one time
outstanding up to but not
exceeding
the
lesser
of (1) the
amount
of
such
Bank's
Revolving
Credit Loan
Commitment at such time, or (2) such
Bank's Pro-Rata Share of the Borrowing Base at such time.
In no event shall any Bank be obligated to make a Revolving
Credit Loan if
any Default or Event of Default
exists or would
result from the making of such
Revolving
Credit Loan.
Subject to the terms and conditions of this
Agreement,
the Borrower may borrow,
repay and re-borrow
under the
Revolving
Credit Loan
facility.
Notwithstanding
anything
herein to the contrary,
on or after the Closing
Date,
the Borrower may
increase the total amount of this credit
facility,
as
such amount is provided in Section 2.1 above, in an aggregate
principal
amount
of up to $20,000,000
(for a total credit facility in an aggregate
amount of up
to
$40,000,000)
subject to the
arrangement
of
additional
commitments
with
financial
institutions
acceptable to the Borrower and the Agent; provided that
in each case (1) no Bank will be required to increase its Revolving
Credit Loan
Commitment,
(2) the Agent shall have no
responsibility
for arranging any such
additional
commitments without the Agent's prior written consent and subject
to
such conditions,
including,
but not limited to fee arrangements,
as the Agent
may provide in connection therewith, (3) there is no continuing
Default or Event
of Default and (4) the conditions to making a Revolving Credit
Loan, as provided
in Section 4.3(a) below, are satisfied.
Credit Agreement - Page 8
(b)
Revolving
Credit Note
.
The
Revolving
Credit Loans made by each
Bank under its Revolving Credit Loan Commitment shall be evidenced
by, and shall
be payable in accordance
with the terms and conditions of, a promissory note of
the Borrower in favor of such Bank in substantially the form of
Exhibit B
hereto
(as to such
Bank,
as the same may be
amended,
renewed,
restated,
replaced,
consolidated
or otherwise
modified from time to time,
its
"
Revolving
Credit
Note
").
Each Revolving
Credit Note shall be in a principal amount equal to the
amount of its Revolving Credit Loan Commitment then in effect and
otherwise duly
completed.
Each
Loan
made
by each
Bank
under
its
Revolving
Credit
Loan
Commitment,
and all payments and
prepayments
made on account of the principal
thereof, shall be recorded by such Bank on its books and records.
2.3
Swingline Loans
.
(a)
General
.
The Swingline Lender agrees, on and subject to the terms
of this Agreement,
to make loans ("
Swingline
Loans
") to the Borrower from time
to time in the following amounts:
(1)
during
the
Resting
Period
(as such
term is
defined
in
Section 2.2(a)(1) above), the Swingline Lender shall have no
obligation
whatsoever
to
make
Swingline
Loans
to
the
Borrower; and
(2)
during the
Post-Resting
Period (as such term is defined in
Section 2.2(a)(2)
above), in an aggregate
principal amount
at
any
time
outstanding
up
to
but
not
exceeding
the
Swingline Loan Commitment at such time;
provided,
that the
aggregate
principal
balance
of all
Swingline
Loans then
outstanding (or which would be outstanding if such Swingline
Loan
were
to be
made)
at any
time
plus
the
aggregate
principal
balance
of
all
Revolving
Credit
Loans
then
outstanding
shall not
exceed
the
lesser of (1) the total
Commitments
of all Banks at such time, or (2) the Borrowing
Base. Subject to the terms and conditions of this Agreement,
during
such
period
the
Borrower
may
borrow,
repay and
reborrow Swingline Loans.
If the Borrower does not repay any Swingline
Loans in accordance with
the terms of this
Agreement,
the
Swingline
Note or any of the
other
Credit
Documents, then the Banks shall reimburse the Swingline Lender on
demand for the
unpaid amount of such Swingline Loans. Such reimbursements
shall be made by the
Banks in accordance with their
respective
Pro-Rata Shares and shall thereafter
be reflected as Revolving
Credit Loans of the Banks on the books and records of
the Agent.
Each Bank
shall fund its
respective
Pro-Rata
Share of
Revolving
Credit Loans as required to repay Swingline
Loans
outstanding to the Swingline
Lender upon demand by the Swingline Lender but in no event later
than 2:00 p.m.,
Central Time, on the next succeeding
Business Day after such demand is made. No
Bank's
obligation
to fund its
Pro-Rata
Share of a
Swingline
Loan
shall be
affected by any other Bank's
failure to fund its Pro-Rata
Share of a Swingline
Loan. Similarly, the Borrower's obligation to repay Swingline Loans
shall not be
affected by any Bank's
failure to reimburse
the Swingline
Lender
pursuant to
this Section 2.3.
If any portion of any
principal
payment
made by the Borrower to the
Swingline
Lender on account of any
Swingline
Loan shall be recovered by or on
behalf of the Borrower from the Swingline Lender in bankruptcy or
otherwise, the
loss of the amount so recovered
shall be ratably
shared among all of the Banks
in accordance with their respective Pro-Rata Shares.
Credit Agreement - Page 9
Each Bank
acknowledges
and agrees that its
obligation
to reimburse
Swingline Loans in accordance with the terms of this Section 2.3 is
absolute and
unconditional
and
shall
not
be
affected
by
any
circumstance
whatsoever,
including,
without
limitation,
the
existence
of a
Default
or an
Event of
Default.
Further,
each
Bank
agrees
and
acknowledges
that if
prior to the
reimbursing of any outstanding Swingline Loans pursuant to this
Section 2.3, one
of the events described in Sections 7(e) shall have occurred, each
Bank will, on
the date the applicable
Revolving
Credit Loan would have been made,
purchase,
without
warranty
or
recourse,
an
undivided
participating
interest
in the
Swingline
Loan to be reimbursed in an amount equal to its Pro-Rata Share of
the
aggregate amount of such Swingline Loan. Each Bank will immediately
transfer to
the
Swingline
Lender,
in
immediately
available
funds,
the
amount
of its
participation and upon receipt thereof the Swingline Lender will
deliver to such
Bank a certificate
evidencing such
participation
dated the date of receipt of
such funds and for such amount. Whenever, at any time after the
Swingline Lender
has
received
from any Bank such Bank's
participating
interest in a Swingline
Loan,
the
Swingline
Lender
receives
any
payment
on account
thereof,
the
Swingline Lender will distribute to such Bank its participating
interest in such
amount (appropriately adjusted, in the case of interest payments,
to reflect the
period of time during which such Bank's
participating
interest was outstanding
and funded).
The parties
acknowledge that the Swingline Loan facility
referred to
in this
Section 2.3 is a
subfacility
of the
Revolving
Credit Loan
facility
referred to in Section 2.2 above and, accordingly, its use by the
Borrower shall
act to reduce,
on a
dollar-for-dollar
basis,
the amount of credit
otherwise
available to the Borrower under such Revolving Credit Loan
facility.
(b)
Swingline Note
. Swingline Loans made by the Swingline Lender shall
be
evidenced by a
promissory
note of the
Borrower in favor of the
Swingline
Lender
in
substantially
the
form of
Exhibit
C
hereto
(as the same may be
amended, renewed,
restated,
replaced,
consolidated or otherwise modified from
time to time, the "
Swingline
Note
"). The Swingline Note shall be in a principal
amount equal to the total Swingline Loan Commitment then in effect
and otherwise
duly completed.
2.4
Reduction and Changes of Commitments
.
(a) The Borrower
shall have the right to terminate in whole or reduce
in part the unused portion of the
Commitments,
upon notice as provided herein;
provided,
however,
that each reduction in the Revolving Credit Loan Commitments
is an amount of not less than
$1,000,000
and whole
multiples
of
$1,000,000;
provided,
further,
that no reduction shall be permitted if, after giving effect
thereto,
and to any
prepayment
made
therewith,
the
outstanding
and unpaid
principal
amount of the Loans shall exceed the
Commitments.
Any
reduction in
part of the unused portion of a Bank's Revolving Credit Loan
Commitment shall be
made in the proportion that such Bank's
Revolving
Credit Loan Commitment bears
to the total amount of the Revolving Credit Loan Commitments.
(b) The
Borrower
shall give the Agent
notice
(and the Agent
shall
promptly
notify the Banks in writing) at least three (3) Business Days prior
to
any such reduction or termination provided in this Section 2.4.
(c) Commitments once reduced in accordance with Section 2.4(a) may
not
be reinstated.
2.5
Pro Rata Treatment
. Except as otherwise provided herein:
(a) each borrowing of Revolving
Credit Loans
hereunder shall be made
from the Banks, and each termination or reduction of the amount of
the Revolving
Credit Loan
Commitments
shall
Credit Agreement - Page 10
be applied to such Commitments of the Banks, in each case in
accordance with the
Banks' respective Pro-Rata Shares;
(b) each
payment and
prepayment
by the
Borrower of principal of or
interest on the Loans shall be made to the Agent for the account of
the Banks in
accordance with their respective
Pro-Rata Shares,
and likewise each payment of
any Shared Fee (but not any other fees or amounts
payable to the Agent
whether
pursuant to a separate
letter or otherwise)
shall be made to the Agent for the
benefit of the Banks in accordance with their respective Pro-Rata
Shares.
Section 3
Finance Charges, Repayment and Other Terms
3.1
Interest Rate
.
(a)
General
.
(1)
Revolving
Credit
Loans
.
Interest
on
each
advance
of a
Revolving
Credit Loan
hereunder
shall accrue at an annual
rate
equal to, at the
Borrower's
election,
(i) the Libor
Rate plus
1.75% or (ii) the
Daily
Reset
Libor
Rate plus
1.75%,
as the Borrower shall
specify,
pursuant to Section
3.7(a) below.
(2)
Swingline
Loans
.
Interest
on each
advance of a Swingline
Loan
hereunder
shall accrue at an annual rate equal to the
Daily Reset Libor Rate plus 1.75%.
(b)
Default Rate
.
Notwithstanding the provisions of subsection 3.1(a)
above,
upon or after the occurrence and during the continuation of any
Event of
Default,
the
principal
amount of each Loan shall bear interest at a per annum
rate equal to three
percent (3%) above the interest
rate that would
otherwise
apply under Section 3.1(a) above (the "
Default Rate
").
(c)
Late Fee
. In addition to interest
payable at the Default
Rate or
any other amounts
payable under this
Agreement or the other Credit
Documents,
the
Borrower
shall
pay to the
Agent a late
fee in an
amount
equal to five
percent (5%) of the amount of each payment due under this Agreement
which is not
received by any Bank within five (5) days after its due date.
(d)
Unused
Line
Fee
.
The
Borrower
shall
pay to the Agent (to be
allocated by the Agent to the Banks in accordance with their
respective Pro-Rata
Shares), on the first day of each fiscal quarter, for the
immediately
preceding
fiscal
quarter,
an unused line fee (the "
Unused Line Fee
") at a rate per annum
equal to 0.375% for such preceding fiscal quarter of the difference
between (a)
the Banks' total credit facility commitments set forth in Section
2.1 above, and
(b) the average
outstanding
principal
balance at the end of each day for such
preceding fiscal quarter.
Notwithstanding
the above, the Unused Line Fee shall
not accrue during the Resting Period.
(e)
Computation of Interest
.
Interest on the
outstanding
principal
balance
of all Loans
and all
other
Obligations,
if any,
under
the
Credit
Documents with respect to which interest
accrues
pursuant to the terms of this
Agreement
shall be
calculated
on a daily
basis,
computed
on the basis of a
360-day
year for the actual
number of days elapsed (or if the Agent so elects,
on the basis of twelve 30-day months for the actual number of days
elapsed).
Credit Agreement - Page 11
(f)
Usury
. In no contingency or event
whatsoever
shall the aggregate
of all
amounts
deemed
interest
hereunder
or under any Note and
charged
or
collected
pursuant to the terms of this Agreement or any other Credit
Documents
exceed the highest
rate
permissible
under any law which a court of
competent
jurisdiction shall, in a final determination, deem applicable
thereto. If such a
court
determines that any amount of interest
charged or received
hereunder or
under the other Credit
Documents is in excess of the highest
applicable
rate,
any such excess shall be applied to any other
Obligations
then due and payable
by the Borrower under the Credit Documents, whether principal,
interest, fees or
otherwise,
and the remainder of such excess interest, if any, shall be
refunded
to the
Borrower,
and such rate shall
automatically
be reduced to the maximum
rate permitted by such law.
3.2
Payments
of
Principal,
Interest
and
Costs
.
Except
as
otherwise
provided in this
Agreement,
the
Borrower
agrees to pay, to the Agent for the
account of each Bank, the Borrower's
obligations
under the Credit Documents as
follows:
(a)
Revolving Credit Loans
.
(3)
Interest
.
Accrued
interest
on the
outstanding
principal
balance
of the
Revolving
Credit
Loans
of
such
Bank is
payable on: (A) in the case of a Revolving
Credit Loan that
accrues
interest at a Libor
Rate,
(i) the earlier of: (I)
the last day of each
Interest
Period or (II) the date that
is three months
following the first day of the then current
Interest
Period
(beginning
_____ __, 2007), or (B) in the
case of a Revolving
Credit Loan that accrues
interest at a
Daily
Reset
Libor
Rate,
on the first
day of each
month
(beginning
_____ __,
2007),
and (C) with
respect
to all
Revolving Credit Loans, the Termination Date.
(4)
Principal
.
The
outstanding
principal
balance
of
the
Revolving
Credit
Loans
of
such
Bank is
payable
on the
Termination Date.
(b)
Swingline Loans
.
(1)
Interest
.
Accrued
interest
on the
outstanding
principal
balance of
Swingline
Loans is payable on (A) the first day
of
each
month
(beginning
_____
__,
2007),
and (B) the
Termination Date.
(2)
Principal
.
The
outstanding
principal
balance
of
the
Swingline Loans is payable on the Termination Date.
(c)
Other
Obligations
.
Costs,
fees
and
expenses
and
any
other
Obligations payable by the Borrower pursuant to this Agreement or
the other Credit
Documents shall be payable as and when provided
in this Agreement or the other Credit Documents,
as the case may
be, or, if no specific provision for payment is made, on demand.
3.3
Voluntary
Prepayments
.
The
Borrower
shall have the right,
without
penalty or premium, to prepay the Loans in whole or in part at any
time and from
time to time after the Closing Date;
provided;
however,
if the Borrower prepays
all or any part of a Loan on any day other than the last day of the
then-current
Interest
Period,
the Borrower shall pay to the Agent the amounts due each Bank
under such circumstances in accordance with Section 3.17(c) of this
Agreement.
Credit Agreement - Page 12
3.4
Mandatory Prepayments
.
(a)
Combined Loan to Value
. If, at any time, the aggregate outstanding
principal
balance of the Loans exceeds the Borrowing
Base,
the Borrower shall
immediately
prepay the Loans in an amount
sufficient
to reduce the
aggregate
unpaid principal balance of the Loans by an amount equal to such
excess.
(b)
Legal Requirement
.
If at any time the Borrower,
the Agent or any
Bank, as the case may be, is required by applicable law to prepay
or to cause to
be prepaid
all or any
portion of the Loans,
the
Borrower
shall
immediately
prepay the Loans in an amount sufficient to satisfy such legal
requirement.
For
purposes of the preceding
sentence,
"applicable
law" and "legal
requirement"
shall include, without limitation,
any legal requirement or restriction imposed
by virtue of
Regulation
U of the Board of
Governors
of the
Federal
Reserve
System or the 1940 Act.
3.5
Method of Payment
.
(a) Except as otherwise
expressly provided herein, the Borrower shall
make each
payment
due under
this
Agreement,
the Notes and the other
Credit
Documents, in immediately available funds, without notice or
demand, and without
exercising any right of set-off, deduction or counterclaim,
not later than 1:00
p.m.,
Central
Time,
on the date when due,
in
Dollars,
to the Agent at such
office as the Agent may designate
from time to time by giving notice thereof to
the Borrower.
Payments received after 1:00 p.m.,
Central Time, shall be deemed
received by the Agent on the next
following
Business
Day, and interest
shall
accrue on such amount until such next
Business Day.
Insofar as the
Borrower's
obligations are concerned,
payment to the Agent shall constitute payment to the
Banks.
(b) The
Agent
shall
remit to each
Bank its
Pro-Rata
Share of all
payments of principal
and interest
under the Loans and any Shared Fee received
by the Agent on the Business Day the Agent
receives
such
payments;
provided,
however,
that if any such
payment is
received
by the Agent
after 2:00 p.m.,
Central Time,
on such
Business Day, then the Agent shall
endeavor to remit to
each Bank its Pro-Rata
Share of such payment on such
Business Day but shall be
under no duty to do so. If the Agent
fails to remit any such
payment
received
after 2:00 p.m.,
Central
Time,
on any Business
Day, the Agent shall remit to
each Bank its Pro-Rata Share of such payment on the next following
Business Day.
(c) All payments
from the Agent to a Bank,
and all
payments
from a
Bank to the Agent, in each case contemplated by this Agreement,
shall be made by
electronic
funds
transfer
or
by
such
other
means
and
pursuant
to
such
instructions
as the Agent and such Bank may agree
from time to time,
any such
agreement to be confirmed in writing at the request of the Agent or
such Bank.
(d) If the due date of any payment under this Agreement,
the Notes or
any of the other Credit
Documents
would otherwise fall on a day which is not a
Business
Day such
payment
date shall
(unless
otherwise
expressly
provided
herein) be extended to the
immediately
succeeding
Business
Day and
interest
shall be payable for any principal so extended for the period of
such extension.
3.6
Use of Proceeds
.
The
Revolving
Credit Loans shall be used solely for
purposes of: (1) the
refinancing
of the existing
senior
indebtedness
of the
Borrower to U.S. Bank National
Association;
(2) the Borrower's
acquisition of
investment
property in the ordinary course of its business;
(3) the Borrower's
general working capital and other general
corporate needs; and (4) paying costs
and
expenses
incurred
in
connection
with the
closing
of the
transactions
contemplated by this Agreement.
Credit Agreement - Page 13
3.7
Notice and Manner of Borrowing
.
(a) The
Borrower
shall give the Agent
notice
(and the Agent
shall
promptly
notify the Banks in writing) of each borrowing
hereunder:
(i) in the
case of a Loan that accrues
interest based on a Daily Reset Libor Rate, by noon
Central Time of the
Business Day such Loan is to be disbursed to the
Borrower,
and (ii) in the case of a Loan that
accrues
interest
at a rate
other
than a
Daily Reset Libor Rate, at least three (3) Business Days before the
Business Day
such Loan is to be disbursed to the Borrower, and the Borrower
shall specify and
provide:
(i) the proposed
funding
date of such Loan,
(ii) the amount of such
Loan and whether the Loan
requested
is a Revolving
Credit Loan or a Swingline
Loan,
(iii) if such
Loan is to bear
interest
based on the
Libor
Rate,
the
Interest
Period
requested by the Borrower for such Loan, (iv) the then current
total fair market value of the financial
assets in the
Securities
Account and
any and all other
assets of the
Borrower,
(v) a Borrowing
Base
Certificate,
substantially in the form of Exhibit D hereto, executed by an
authorized officer
of the
Borrower
providing
the current
Borrowing
Base and
stating
that the
Borrower is in compliance with all applicable
leverage
regulations of the 1940
Act;
and (vi) only in the case of a Revolving
Credit
Loan,
whether such Loan
shall accrue
interest at a Daily Reset Libor Rate. All notices given under this
Section by the Borrower shall be
irrevocable
and shall be given not later than
11:00 a.m. Central Time on the day which is not less than the
number of Business
Days specified above for such notice. For purposes of this Section,
the Borrower
and the Banks
agree that the Agent may rely and act upon any request for a Loan
from
any
individual
who
the
Agent,
absent
gross
negligence
or
willful
misconduct, believes to be a representative of the Borrower.
(b) Not later than 1:00 p.m.,
Central Time, on the date specified for
each borrowing hereunder, each Bank shall make available to the
Agent the amount
of the
Revolving
Credit
Loan to be made by it on such date,
at such
account
maintained by the Agent as the Agent shall
specify,
in
immediately
available
funds,
for the
account of the
Borrower.
The amount so
received by the Agent
shall,
subject to the terms and conditions of this Agreement,
promptly be made
available to the
Borrower by
depositing
the same,
in
immediately
available
funds, in one or more accounts of the Borrower maintained with the
Agent.
3.8
Minimum
Amount
.
Each borrowing of a Loan that accrues
interest at a
Daily
Reset Libor Rate shall be in an amount of at least
$250,000
and a whole
multiple of $25,000.
Each
borrowing of a Loan that accrues
interest at a rate
other than a Daily Reset Libor Rate shall be in an amount of at
least $1,000,000
and a whole multiple of $250,000.
3.9
Capital
Adequacy
.
If the Agent
determines
that the adoption of any
law, rule or regulation regarding capital adequacy,
or any change therein or in
the
interpretation
or
application
thereof or
compliance by the Agent or the
Banks with any request or directive
regarding
capital adequacy (whether or not
having the force of law) from any central bank or governmental
authority,
does
or shall have the effect of
reducing
the rate of return on the
Agent's or any
Bank's
capital as a consequence of its
obligations
hereunder to a level below
that which the Agent or the Banks
could have
achieved
but for such
adoption,
change or
compliance
(taking
into
consideration
the
Agent's and the Banks'
policies with respect to capital adequacy) by an amount deemed by
the Agent (or,
the Required Banks) to be material,
then from time to time, after submission by
the Agent to the Borrower of a written demand
therefor,
the Borrower shall pay
to the Agent such additional
amount or amounts as will compensate the Agent for
such
reduction.
A certificate of the Agent claiming
entitlement to payment as
set forth in this Section shall be conclusive in the absence of
manifest
error.
Such
certificate
shall set forth the nature of the
occurrence
giving rise to
such payment,
the additional amount or amounts to be paid to the Agent, and the
method by which such amounts were determined.
In determining
such amount,
the
Agent may use any reasonable averaging and attribution method.
Credit Agreement - Page 14
3.10
Application
of Payments and
Collections
.
The
Borrower
irrevocably
waives
the
right
to
direct
the
application
of any
and all
payments
and
collections
at any time or times after the Closing
Date
received by the Agent
from or on behalf of the
Borrower,
and the Borrower
agrees that the Agent and
each affected Bank has the continuing
exclusive
right to apply and reapply any
and all such
payments and
collections
received at any time or times after the
Closing Date by the Agent or its agent against the
Obligations,
in such manner
as the Agent and each
affected
Bank may deem
advisable,
notwithstanding
any
entry by the Agent or any Bank upon any of its books and records.
3.11
Periodic Statement
. The Agent may, in its sole discretion,
account to
the Borrower with a periodic
statement of loan
balances,
charges and payments
made or received pursuant to this Agreement,
and any such statement rendered by
the Agent shall be deemed final, binding and conclusive upon the
Borrower unless
the Agent is notified by the Borrower in writing to the contrary
within 45 days
after the date such statement is made available to the Borrower.
Any such notice
by the Borrower
shall only be deemed an
objection to those items
specifically
objected to in such notice.
3.12
Non-Receipt of Funds by Agent
.
(a) Unless the Agent shall have
received
notice from a Bank prior to
the date on which
such Bank is to
provide
funds to the Agent for a Loan to be
made by such
Bank that such
Bank
will not make
available
to the Agent
such
funds,
the Agent may assume that such Bank has made such funds available
to the
Agent on the date of such Loan in
accordance
with Section 3.7 and the Agent in
its sole
discretion
may,
but shall not be
obligated
to, in reliance on such
assumption,
make available to the Borrower on such date a corresponding amount.
If, and to the extent such Bank shall not have so made such funds
available
to
the
Agent,
such Bank
agrees to repay to the Agent
forthwith
on demand
such
corresponding
amount together with interest thereon, for each day from the date
such amount is repaid to the Agent,
at the customary
rate set by the Agent for
the
correction of errors among banks for three (3) Business Days and
thereafter
at the Prime Rate. If such Bank does not pay such corresponding
amount forthwith
upon the Agent's demand therefore, the Agent shall promptly notify
the Borrower,
and the Borrower shall
immediately pay such
corresponding
amount to the Agent
with interest thereon,
for each day from the date such amount is made available
to the Borrower
until the date such amount is repaid to the Agent,
at the rate
of interest applicable at the time to such proposed Loan.
(b) Unless the Agent
shall have
received
notice
from the
Borrower
prior to the date on which any
payment is due to the Banks
hereunder
that the
Borrower
will not make such
payment
in full,
the Agent may
assume
that the
Borrower
has made such
payment in full to the Agent on such date and the Agent
in its sole discretion may, but shall not be obligated to, in
reliance upon such
assumption,
cause to be
distributed
to each
Bank on such due date an
amount
equal to the amount then due such Bank. If and to the extent the
Borrower
shall
not have so made such payment in full to the Agent, each Bank shall
repay to the
Agent
forthwith on demand such amount
distributed
to such Bank
together with
interest thereon,
for each day from the date such amount is distributed to such
Bank until the date such Bank repays such amount to the Agent,
at the customary
rate set by the Agent for the
correction
of errors
among
banks for the three
Business Days and thereafter at the Prime Rate.
3.13
Several
Obligations
.
The
failure of any Bank to make any Loan to be
made by it on the date
specified
therefor
shall not relieve any other Bank of
its obligation to make its Loan on such date, but neither any Bank
nor the Agent
shall be responsible for the failure of any other Bank to make a
Loan to be made
by such other Bank.
3.14
Benefits of
Collateral
.
The Agent shall hold all of the
Collateral,
along with all payments and proceeds arising
therefrom,
for the benefit of all
Banks as ratable
security for the payment of the
Obligations.
Upon payment in
full of the Obligations, the Agent shall release all of the
Collateral
Credit Agreement - Page 15
remaining in the Agent's
possession
to the Borrower and shall notify each Bank
of such action.
The Agent, in its own name or in the name of the Borrower,
may
enforce any of the
Collateral
or the
security
therefor by any mode
provided
under the Credit
Documents or by applicable
law, and may collect,
receive and
receipt for all proceeds receivable on account of ownership of the
Collateral.
3.15
Proceeds from Collateral
.
To the extent that the Collateral
includes
notes or other instruments evidencing any monetary obligation to,
or interest of
the Borrower,
the Borrower shall deliver to the Agent letters,
executed by the
Borrower and approved by counsel for the Agent,
notifying
the obligors to make
payments directly to the Agent, such letters to be held by the
Agent and sent to
such
obligors at its
discretion.
All payments and proceeds of every kind from
the Collateral, when directly received by the Agent (whether from
payments on or
with respect to the
Collateral,
from
foreclosure
and sales to third parties,
from sale of Collateral
subsequent
to a foreclosure
at which the Agent or any
Bank was the purchaser,
or otherwise) shall be held by the Agent as part of the
Collateral and, except as otherwise
expressly
provided
hereinafter,
shall be
applied to the Obligations pursuant to Section 3.7(b) above.
3.16
Balance; Sharing of Payments
.
(a) If any Bank shall obtain
payment of any
principal of or interest
on any Loan
through
the
exercise of any right of
set-off,
banker's
lien or
counterclaim
or similar right or
otherwise,
and, as a result of such payment,
such Bank shall have received a greater
percentage of the principal or interest
then due hereunder by the Borrower to such Bank than its Pro-Rata
Share thereof,
it shall promptly
purchase from such other Banks
participations in (or, if and
to the extent
specified by such Bank,
direct
interests
in) the Loans made by
such
other
Banks
(or in
interest
due
thereon,
as the case may be) in such
amounts,
and
make
such
other
adjustments
from
time to time
as
shall
be
equitable,
to the end that all the Banks shall share the benefit of such
excess
payment (net of any expenses
which may be incurred by such Bank in obtaining or
preserving such excess payment) pro rata in accordance with the
unpaid principal
and/or
interest
on the Loans held by each of the Banks.
To such end,
all the
Banks shall make
appropriate
adjustments
among
themselves
(by the resale of
participations sold or otherwise) if such payment is rescinded or
must otherwise
be restored. The Borrower agrees that any Bank so purchasing a
participation (or
direct
interest)
in the Loans made by other Banks (or in interest due thereon,
as the case may be) may exercise any and all rights of set-off,
bankers'
lien,
counterclaim or similar rights with respect to such participation
as fully as if
such Bank were a direct
holder
of Loans in the
amount of such
participation.
Nothing in this
Agreement
shall require any Bank to exercise any such right or
shall
affect the right of any Bank to
exercise,
and retain
the
benefits
of
exercising,
any such right with respect to any other indebtedness or obligation
of the
Borrower.
If,
under any
applicable
bankruptcy,
insolvency
or other
similar
law,
any Bank
receives a secured
claim in lieu of a set-off to which
this Section 3.16 applies, such Bank shall, to the extent
practicable,
exercise
its rights in
respe
