CREDIT AGREEMENT
Published on August 14, 1998
EXECUTION COPY
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CREDIT AGREEMENT
dated as of June 24, 1998
among
RENAISSANCE U.S. HOLDINGS, INC.
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS,
as the Lenders,
and
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Administrative Agent for the Lenders
and
BANCAMERICA ROBERTSON STEPHENS,
as Arranger
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|| TABLE OF CONTENTS
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SCHEDULES AND EXHIBITS
iii
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of June 24, 1998, is entered into by and
among Renaissance U.S. Holdings, Inc., a Delaware corporation (the "Borrower"),
various financial institutions which are parties hereto (the "Lenders") and Bank
of America National Trust and Savings Association, as Administrative Agent for
the Lenders (in such capacity, the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower proposes to acquire the capital stock and certain
assets of certain operating subsidiaries of Nobel Insurance Limited pursuant to
the Purchase Agreement (this, and other capitalized terms used in these recitals
being defined in Section 1.1 of this Agreement);
WHEREAS, in order to finance the Purchase, to pay certain fees and
expenses incurred in connection with the Purchase and to provide for the general
corporate needs of the Borrower and its Subsidiaries, the Borrower has requested
the Lenders to make up to $35,000,000 in Term Loans and provide up to a
$15,000,000 Revolving Loan facility;
WHEREAS, the Guarantor is the ultimate parent of the Borrower and has
agreed to guaranty the credit facilities hereunder;
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. When used herein the following terms
shall have the following meanings:
Administrative Agent means (a) Bank of America National Trust and
Savings Association, in its capacity as administrative agent for the Lenders,
and (b) each other Person as shall have subsequently been appointed as the
successor Administrative Agent pursuant to Section 9.9.
Affiliate of any Person means any other Person which, directly or
indirectly, controls or is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be:
(a) "controlled by" any other Person if such other Person
possesses, directly or indirectly, power:
(i) to vote 20% or more of the securities having at the
time of any determination hereunder voting power for the election
of directors of such Person; or
(ii) to direct or cause the direction of the management
and policies of such Person whether by contract or otherwise; or
(b) "controlled by" or "under common control with" such other
Person if such other Person is the executor, administrator, or other
personal representative of such Person.
Agent-Related Persons means BofA, any successor administrative
agent arising under Section 9.9 and the Arranger, together with their respective
Affiliates, and the officers, directors, employees, agents and attorneys-in-fact
of such Persons and Affiliates.
Agent's Payment Office means the address for payments set forth
on Schedule 10.2 in relation to the Administrative Agent, or such other address
as the Administrative Agent may from time to time specify.
Agreement means this Credit Agreement.
Annual Statement means the annual financial statement of any
Insurance Subsidiary as required to be filed with the Department (or similar
Governmental Authority) of such Insurance Subsidiary's domicile, together with
all exhibits or schedules filed therewith, prepared in conformity with SAP.
References to amounts on particular exhibits, schedules, lines, pages and
columns of the Annual Statement are based on the format promulgated by the
Department for the 1997 Annual Statements. If such format is changed in future
years so that different information is contained in such items or they no longer
exist, it is understood that the reference is to information consistent with
that reported in the referenced item in the 1997 Annual Statement of such
Insurance Subsidiary.
Applicable Margin means (a) in the case of Offshore Rate Loans,
the rate set forth opposite "Offshore Rate" on the Pricing Grid for the
applicable Pricing Level and (b) in the case of Base Rate Loans, 0%.
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Applicable Non-Use Fee Rate means the rate set forth opposite the
"Non-Use Fee" on the Pricing Grid for the applicable Pricing Level.
Arranger means BancAmerica Robertson Stephens.
Assignee is defined in Section 10.8(a).
Assignment and Acceptance is defined in Section 10.8(a).
Attorney Costs means and includes all fees and disbursements of
any law firm or other external counsel, the allocated cost of internal legal
services and all disbursements of internal counsel.
Authorized Officers means those officers of the Borrower whose
signatures and incumbency shall have been certified to the Administrative Agent
pursuant to Section 8.1(c).
Available Dividends means, for any Fiscal Quarter, the maximum
allowable unpaid dividends (based on the prior Fiscal Year) which, under
Department regulations, may be paid by the Insurance Subsidiaries to the
Borrower.
Base Rate means, for any day, the higher of: (a) 0.50% per annum
above the latest Federal Funds Rate; and (b) the rate of interest in effect for
such day as publicly announced from time to time by BofA in San Francisco,
California, as its "reference rate." (The "reference rate" is a rate set by BofA
based upon various factors including BofA's costs and desired return, general
economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such announced
rate.)
Any change in the reference rate announced by BofA shall take
effect at the opening of business on the day specified in the public
announcement of such change.
Base Rate Loan means a Loan that bears interest based on the Base
Rate.
BofA means Bank of America National Trust and Savings
Association, a national banking association.
Borrowing means a borrowing hereunder consisting of Loans of the
same Type made to the Borrower on the same day by the Lenders under Article II,
and, other than in the case of Base Rate Loans, having the same Interest Period.
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Borrowing Date means any date on which a Borrowing occurs under
Section 2.4.
Borrower is defined in the Preamble.
Borrower Reinsurance Agreement means any arrangement whereby any
Insurance Subsidiary, as reinsurer, agrees to indemnify any other insurance or
reinsurance company against all or a portion of the insurance or reinsurance
risks underwritten by such insurance or reinsurance company under any insurance
or reinsurance policy and any Catastrophe Bonds purchased by the Borrower or any
of its Subsidiaries.
Business Day means any day other than a Saturday, Sunday or other
day on which commercial banks in Chicago, New York or Bermuda are authorized or
required by law to close and, if the applicable Business Day relates to any
Offshore Rate Loan, means such a day on which dealings are carried on in the
applicable eurodollar interbank market.
Capital Adequacy Regulation means any guideline, request or
directive of any central bank or other Governmental Authority, or any other law,
rule or regulation, whether or not having the force of law, in each case,
regarding capital adequacy of any bank or of any corporation controlling a bank.
Capitalized Lease means, as to any Person, any lease which is or
should be capitalized on the balance sheet in accordance with GAAP, together
with any other lease which is in substance a financing lease, including, without
limitation, any lease under which (a) such Person has or will have an option to
purchase the property subject thereto at a nominal amount or an amount less than
a reasonable estimate as of the date the lease is entered into of the fair
market value of such property or (b) the term of the lease approximates or
exceeds the expected useful life of the property leased thereunder.
Catastrophe Bonds means (a) any note, bond or other Debt
instrument or agreement which has a catastrophe risk feature linked to payments
thereunder and (b) any equity interest in a Person that is not a Subsidiary
controlled, directly or indirectly, by the Borrower for the sole purpose of
investing in Debt of the type described in clause (a), which, in the case of
Catastrophe Bonds purchased by the Borrower or any of its Subsidiaries, are
purchased in accordance with its customary reinsurance underwriting procedures.
Change in Control shall be deemed to have occurred if (a) any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all, or substantially all, of the assets of the
Guarantor occurs; (b) any
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"person" as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") other than a Founding
Shareholder, is or becomes, directly or indirectly, the "beneficial owner," as
defined in Rule 13d-3 under the Exchange Act, of securities of the Guarantor
that represent 51% or more of the combined voting power of the Guarantor's then
outstanding securities; (c) during any period of two consecutive years,
individuals who at the beginning of such period constituted the Board of
Directors of the Guarantor (together with any new directors whose election by
the Board of Directors or whose nomination by the stockholders of the Guarantor
was approved by a vote of a majority of the Directors of the Guarantor then
still in office who are either directors at the beginning of such period or
whose election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Guarantor's Board of Directors then
in office; or (d) the Guarantor ceases to own, directly or indirectly, 100% of
the capital stock of and beneficial interest in the Borrower other than any
directors' qualifying shares.
Code means the Internal Revenue Code of 1986, as amended and any
successor statute of similar import, together with the regulations thereunder,
as amended, reformed or otherwise modified and in effect from time to time.
References to sections of the Code shall be construed to also refer to successor
sections.
Commitments means the Revolving Loan Commitments and
the Term Loan Commitments.
Commitment Termination Event means (a) the occurrence of a
Default described in Section 7.1(e) or (b) the occurrence and continuance of any
other Event of Default and either (i) the Loans are declared to be due and
payable pursuant to Section 7.2, or (ii) in the absence of such declaration, the
Administrative Agent, acting at the direction of the Required Lenders, gives
notice to the Borrower that the Commitments have been terminated.
Compliance Certificate means a certificate substantially in the
form of Exhibit C but with such changes as the Administrative Agent may from
time to time reasonably request for purposes of monitoring the Borrower's
compliance herewith.
Computation Period means, for each Fiscal Quarter, the four
consecutive Fiscal Quarters ending on the last day of such Fiscal Quarter.
Consolidated EBITDA means, as of the last day of any Fiscal
Quarter, the sum, without duplication, of: (a) Consolidated Net Income for the
Computation Period for the Non- Insurance Subsidiaries, plus (b) the
consolidated interest
5
expense and other financing costs of the Non-Insurance Subsidiaries deducted in
determining Consolidated Net Income for such Computation Period, plus (c) all
depreciation and amortization of assets (including goodwill and other intangible
assets) of the Non-Insurance Subsidiaries deducted in determining Consolidated
Net Income for such Computation Period, plus (d) all federal, state, local and
foreign income taxes (whether paid or deferred) of the Non-Insurance
Subsidiaries deducted in determining Consolidated Net Income for such
Computation Period, plus (e) other non-cash expenses and all extraordinary and
non-recurring expenses of the Non-Insurance Subsidiaries deducted in determining
Consolidated Net Income for such Computation Period.
Consolidated Net Income means, with respect to any Person, the
consolidated net income for such period as determined by GAAP, adjusted by
excluding, without duplication, to the extent included in calculating such
Consolidated Net Income, all extraordinary gains and losses.
Contingent Liability means any agreement, undertaking or
arrangement by which any Person (outside the ordinary course of business)
guarantees, endorses, acts as surety for or otherwise becomes or is contingently
liable for (by direct or indirect agreement, contingent or otherwise, to provide
funds for payment by, to supply funds to, or otherwise to invest in, a debtor,
or otherwise to assure a creditor against loss) the Debt, obligation or other
liability of any other Person (other than by endorsements of instruments in the
course of collection), or for the payment of dividends or other distributions
upon the shares of any other Person or undertakes or agrees (contingently or
otherwise) to purchase, repurchase, or otherwise acquire or become responsible
for any Debt, obligation or liability or any security therefor, or to provide
funds for the payment or discharge thereof (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise), or to maintain
solvency, assets, level of income, or other financial condition of any other
Person, or to make payment or transfer property to any other Person other than
for fair value received; provided, however, that obligations of each of the
Insurance Subsidiaries under Primary Policies or Borrower Reinsurance Agreements
which are entered into in the ordinary course of business (including security
posted by each of the Insurance Subsidiaries in the ordinary course of its
business to secure obligations thereunder) shall not be deemed to be Contingent
Liabilities of such Insurance Subsidiary or the Borrower for the purposes of
this Agreement. The amount of any Person's obligation under any Contingent
Liability shall (subject to any limitation set forth therein) be deemed to be
the outstanding principal amount (or maximum permitted principal amount, if
larger) of the Debt, obligation or other liability guaranteed or supported
thereby.
6
Contractual Obligation means, relative to any Person, any
obligation, commitment or undertaking under any agreement or other instrument to
which such Person is a party or by which it or any of its property is bound or
subject.
Controlled Group means the Borrower and any corporation, trade or
business that is, along with the Borrower, a member of a controlled group of
corporations or a controlled group of trades or businesses as described in
sections 414(b) and 414(c), respectively, of the Code or in section 4001 of
ERISA.
Debt means, with respect to any Person, at any date, without
duplication, (a) all obligations of such Person for borrowed money or in respect
of loans or advances (including, without limitation, any such obligations issued
by such Person that qualify as Catastrophe Bonds described in clause (a) of the
definition thereof net of any escrow established (whether directly or to secure
any letter of credit issued to back such Catastrophe Bonds) in connection with
such Catastrophe Bonds); (b) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments; (c) all obligations in respect
of letters of credit which have been drawn but not reimbursed by the Person for
whose account such letter of credit was issued, and bankers' acceptances issued
for the account of such Person; (d) all obligations in respect of Capitalized
Leases of such Person; (e) all Hedging Obligations of such Person other than
Hedging Obligations which are reflected in such Person's financial statements;
(f) whether or not so included as liabilities in accordance with GAAP, all
obligations of such Person to pay the deferred purchase price of property or
services; (g) Debt of such Person secured by a Lien on property owned or being
purchased by such Person (including Debt arising under conditional sales or
other title retention agreements) whether or not such Debt is limited in
recourse; (h) any Debt of another Person secured by a Lien on any assets of such
first Person, whether or not such Debt is assumed by such first Person (it being
understood that if such Person has not assumed or otherwise become personally
liable for any such Debt, the amount of the Debt of such Person in connection
therewith shall be limited to the lesser of the face amount of such Debt and the
fair market value of all property of such Person securing such Debt); (i) any
Debt of a partnership in which such Person is a general partner unless such debt
is nonrecourse to such Person; and (j) all Contingent Liabilities of such Person
whether or not in connection with the foregoing; provided that, notwithstanding
anything to contrary contained herein, Debt shall not include(x) unsecured
current liabilities incurred in the ordinary course of business and paid within
90 days after the due date (unless contested diligently in good faith by
appropriate proceedings and, if requested by the Administrative Agent, reserved
against in conformity with GAAP) other than liabilities that are for
7
money borrowed or are evidenced by bonds, debentures, notes or other similar
instruments or (y) any obligations of such Person under any Borrower Reinsurance
Agreement or any Primary Policy.
Debt Service Coverage Ratio means the ratio of (a) the sum of (i)
Available Dividends plus (ii) Consolidated EBITDA plus (iii) cash and cash
equivalents on hand at the Guarantor as of the last day of the Computation
Period to (b) Future Debt Service.
Default means any condition or event, which, after notice or
lapse of time or both, would constitute an Event of Default.
Department is defined in Section 4.2.
Dollar(s) and the sign "$" means lawful money of the United
States of America.
Effective Date means the date on which the conditions precedent
for the effectiveness of this Agreement specified in Section 8.1 shall be met.
Eligible Assignee means (a) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined capital
and surplus of at least $250,000,000; (b) a commercial bank organized under the
laws of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having a combined capital and surplus of at least $250,000,000,
provided that such bank is acting through a branch or agency located in the
United States; (c) a Person that is primarily engaged in the business of
commercial banking and that is (i) a Subsidiary of a Lender, (ii) a Subsidiary
of a Person of which a Lender is a Subsidiary, or (iii) a Person of which a
Lender is a Subsidiary; and (d) mutual funds, pension funds and other
institutional investors (except an Affiliate of the Borrower) regularly engaged
in the making of commercial loans; provided, that any Eligible Assignee which is
not organized under the laws of the United States or a state thereof must, on
the date it becomes a Lender hereunder, make the representation and give the
documents required under Section 9.10.
ERISA means the Employee Retirement Income Security Act of 1974,
as amended, and any successor statute of similar import, together with the
regulations promulgated thereunder and under the Code, in each case as in effect
from time to time. References to sections of ERISA also refer to successor
sections.
8
ERISA Event means, with respect to the Borrower, (a) a Reportable
Event (other than a Reportable Event not subject to the provision for 30-day
notice to the PBGC under regulations issued under section 4043 of ERISA), (b)
the withdrawal of the Borrower or any Affiliate from a Plan during a plan year
in which it was a "substantial employer" as defined in section 4001(a)(2) of
ERISA if such withdrawal would have a Material Adverse Effect, (c) the filing of
a notice of intent to terminate a Plan under a distress termination or the
treatment of a Plan amendment as a distress termination under section 4041(c) of
ERISA, (d) the institution of proceedings to terminate a Plan by the PBGC under
section 4042 of ERISA, (e) the failure to make required contributions which
would result in the imposition of a Lien under section 412 of the Code or
section 302 of ERISA, or (f) any other event or condition which might reasonably
be expected to constitute grounds under section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan.
Event of Default means any of the events described in Section
7.1.
Executive Officer means, as to any Person, the president, the
chief financial officer, the chief executive officer, the general counsel, the
treasurer or the secretary.
Federal Funds Rate means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including any
such successor, "H.15(519)") on the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is not so
published on any such preceding Business Day, the rate for such day will be the
arithmetic mean as determined by the Administrative Agent of the rates for the
last transaction in overnight Federal funds arranged prior to 9:00 a.m. (New
York City time) on that day by each of three leading brokers of Federal funds
transactions in New York City selected by the Administrative Agent.
Final Maturity Date means the fifth anniversary of the Funding
Date.
Fiscal Quarter means any quarter of a Fiscal Year.
Fiscal Year means any period of twelve consecutive calendar
months ending on the last day of December.
FRB means the Board of Governors of the Federal Reserve System,
and any Governmental Authority succeeding to any of its principal functions.
9
Founding Shareholders means Persons who are signatories to the
Shareholders Agreement on the Effective Date or their Affiliates.
Funding Date means the date on which the conditions precedent for
the initial Borrowing specified in Section 8.2 shall be met.
Funding Percentage means for any Lender, the percentage set forth
opposite the name of such Lender in Schedule 2.1 as the same may be adjusted
from time to time pursuant to Section 10.8.
Future Debt Service shall mean at any time the sum of (a) the
consolidated projected interest expense on all outstanding Debt of the Borrower
and its Subsidiaries for the next four consecutive Fiscal Quarters plus (b) all
scheduled principal payments on outstanding Debt of the Borrower and its
Subsidiaries during the next four consecutive Fiscal Quarters. For purposes of
this definition, (i) the projected interest expense with respect to any Debt
shall be calculated by multiplying the outstanding principal amount of such Debt
at the date of calculation by the annualized interest rate then applicable or
which would be applicable to such principal amount and subtracting therefrom,
for each mandatory reduction of principal that is scheduled to occur within such
four Fiscal Quarters, the corresponding portion of such interest and (ii)
repayments of Revolving Loans hereunder (other than Revolving Loans due on the
Commitment Termination Date) shall not be included as scheduled principal
payments.
GAAP means generally accepted accounting principles set forth
from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board (or
agencies with similar functions of comparable stature and authority within the
U.S. accounting profession), which are applicable to the circumstances as of the
date of determination.
Governmental Authority means any nation or government, any state
or other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
Guarantor means RenaissanceRe Holdings Ltd., a Bermuda company.
Guaranty means a Guaranty substantially in the form of Exhibit G
executed by the Guarantor.
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Hedging Obligations means, with respect to any Person, the net
liability of such Person under any futures contract or options contract
(including property catastrophe futures and options), interest rate swap
agreements and interest rate collar agreements and all other agreements or
arrangements (other than Reinsurance Agreements and Catastrophe Bonds) designed
to protect such Person against catastrophic events, fluctuations in interest
rates or currency exchange rates.
Indemnified Liabilities is defined in Section 10.5.
Indemnified Person is defined in Section 10.5.
Insurance Code means, with respect to any Insurance Subsidiary,
the Insurance Code of such Insurance Subsidiary's domicile and any successor
statute of similar import, together with the regulations thereunder, as amended
or otherwise modified and in effect from time to time. References to sections of
the Insurance Code shall be construed to also refer to successor sections.
Insurance Policies means policies purchased from insurance
companies by the Borrower or any of its Subsidiaries, for its own account to
insure against its own liability and property loss (including, without
limitation, casualty, liability and workers' compensation insurance).
Insurance Subsidiary means Nobel and any other Subsidiary of the
Borrower created after the Effective Date which is licensed by any Governmental
Authority to engage in the insurance business.
Interest Payment Date means, as to any Offshore Rate Loan, the
last day of each Interest Period applicable to such Loan and if an Interest
Period exceeds three months, the day three months after the commencement of the
Interest Period and the last day thereof and, as to any Base Rate Loan, the last
Business Day of each calendar quarter.
Interest Period means as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the Conversion/Continuation
Date on which the Loan is converted into or continued as an Offshore Rate Loan,
and ending on the date one, two, three or six months thereafter as selected by
the Borrower in its Notice of Borrowing or Notice of Conversion/Continuation;
provided that:
(i) if any Interest Period would otherwise end on a day that is
not a Business Day, that Interest Period shall
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be extended to the following Business Day unless the result of such
extension would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the preceding
Business Day;
(ii) any Interest Period that begins on the last Business Day of
a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period;
(iii) no Interest Period for any Revolving Loan shall extend
beyond the Revolving Commitment Termination Date; and
(iv) no Interest Period for any Term Loan shall extend beyond the
Final Maturity Date.
IRS means the U.S. Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
Lenders is defined in the Preamble.
Lending Office means, as to any Lender, the office or offices of
such Lender specified as its "Lending Office" or "Domestic Lending Office" or
"Offshore Lending Office", as the case may be, on Schedule 10.2, or such other
office or offices as such Lender may from time to time notify the Borrower and
the Administrative Agent.
License(s) is defined in Section 4.14.
Lien means, when used with respect to any Person, any interest in
any real or personal property, asset or other right held, owned or being
purchased or acquired by such Person for its own use, consumption or enjoyment
which secures payment or performance of any obligation and shall include any
mortgage, lien, pledge, encumbrance, charge, retained title of a conditional
vendor or lessor, or other security agreement, mortgage, deed of trust, chattel
mortgage, assignment, pledge, retention of title, financing or similar statement
or notice, or other encumbrance arising as a matter of law, judicial process or
otherwise.
"Loan" means an extension of credit by a Lender to the Borrower
under Article II, and may be a Base Rate Loan or an Offshore Rate Loan (each, a
"Type" of Loan).
Loan Documents means this Agreement, the Guaranty, any
Notes and all other agreements, instruments, certificates,
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documents, schedules or other written indicia delivered by the Borrower or any
of its Subsidiaries or the Guarantor in connection with any of the foregoing.
Margin Stock means "margin stock" as such term is defined in
Regulation U or X of the FRB.
Material Adverse Effect means, the occurrence of an event
(including any adverse determination in any litigation, arbitration, or
governmental investigation or proceeding), which has or could reasonably be
expected to have a materially adverse effect on:
(a) the assets, business, financial condition or
operations of the Guarantor and its Subsidiaries taken as a
whole; or
(b) the ability of the Guarantor to perform any of its payment or
other material obligations under any of the Loan Documents; or
(c) the legality, validity, binding effect or enforceability
against the Borrower or the Guarantor of any Loan Document that by its
terms purports to bind the Borrower or the Guarantor.
Multiemployer Plan means a "multiemployer plan" as defined in
section 4001(a)(3) of ERISA, and to which the Borrower or any of the
Subsidiaries is making, or is obligated to make, contributions, or has made, or
has been obligated to make, contributions.
Net Debt Proceeds means, relative to Debt described in clause (a)
or (b) of the definition of Debt issued or incurred by the Borrower or any of
its Subsidiaries after the Effective Date (other than Debt under this Agreement,
Debt owed to the Guarantor or any of its Subsidiaries and Debt incurred in
connection with liens permitted under Section 6.7(iii) and (vi)), the excess of
(a) the gross cash proceeds received by the Borrower
or such Subsidiary
over
(b) all reasonable underwriting commissions, private placement
fees, legal, investment banking, and accounting fees and disbursements,
printing expenses, and any governmental or exchange fees incurred (or
reasonably expected to be incurred) in connection with such issuance or
incurrence which are not payable to Affiliates of the Borrower and any
escrows established (whether directly or to
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secure any letter of credit issued to back such Catastrophe Bonds) to
support or in connection with the issuance of Catastrophe Bonds.
Nobel means Nobel Insurance Company, a Texas corporation.
Non-Insurance Subsidiary means any Subsidiary of the Borrower
which is not an Insurance Subsidiary.
Note means a promissory note executed by the Borrower in favor of
a Lender pursuant to Section 2.3(b), in substantially the form of Exhibit F.
Notice of Borrowing means a notice in substantially the form of
Exhibit A.
Notice of Conversion/Continuation means a notice in substantially
the form of Exhibit B.
Obligations means all obligations and liabilities of the Borrower
and its Subsidiaries to the Administrative Agent or any of the Lenders,
howsoever created, arising or evidenced, whether direct or indirect, absolute or
contingent, primary or secondary, joint or several, recourse or nonrecourse or
now or hereafter existing or due or to become due, whether for principal,
interest, fees, expenses, lease obligations, claims, indemnities or otherwise,
under or in connection with this Agreement or any other Loan Document.
Offshore Rate means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of interest
per annum (rounded upward to the next 1/16th of 1%) determined by the
Administrative Agent as follows:
Offshore Rate = IBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
Eurodollar Reserve Percentage means for any day for any Interest
Period the maximum reserve percentage (expressed as a decimal, rounded
upward to the next 1/100th of 1%) in effect on such day (whether or not
applicable to any Lender) under regulations issued from time to time by
the FRB for determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement) with
respect to Eurocurrency funding (currently referred to as "Eurocurrency
liabilities"); and
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IBOR means the rate of interest per annum determined by the
Administrative Agent to be the arithmetic mean (rounded upward to the
next 1/16th of 1%) of the rates of interest per annum determined by the
Administrative Agent as the rate of interest at which dollar deposits in
the approximate amount of the amount of the Loan to be made or continued
as, or converted into, an Offshore Rate Loan by the Administrative Agent
or its Affiliates and having a maturity comparable to such Interest
Period would be offered by the Administrative Agent to prime
international banks in the offshore dollar market at approximately 10:00
a.m. (Chicago time) two Business Days prior to the commencement of such
Interest Period.
The Offshore Rate shall be adjusted automatically as to all
Offshore Rate Loans then outstanding as of the effective date of any change in
the Eurodollar Reserve Percentage.
Offshore Rate Loan means a Loan that bears interest based on the
Offshore Rate.
Ordinary Course Litigation is defined in Section 4.4.
Organization Documents means, for any corporation, the
certificate or articles of incorporation, the bylaws, any certificate of
determination or instrument relating to the rights of preferred shareholders of
such corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation.
Other Taxes means any present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to, this Agreement or any other Loan
Documents.
Participants is defined in Section 10.8(d).
PBGC means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions.
Person means any natural person, corporation, partnership, firm,
trust, association, government, governmental agency or other entity, whether
acting in an individual, fiduciary or other capacity.
Plan means any "employee pension benefit plan," as such term is
defined in ERISA, which is subject to Title IV of ERISA (other than a
"Multiemployer Plan"), and as to which any entity in the Controlled Group has or
may have any liability, including
15
any liability by reason of having been a substantial employer within the meaning
of section 4063 of ERISA for any time within the preceding five years or by
reason of being deemed to be a contributing sponsor under section 4069 of ERISA.
Pricing Grid means the Pricing Grid set forth on Schedule 1.2.
Pricing Level means the Pricing Level on the Pricing Grid which
is applicable from time to time and in accordance with Section 2.7(c).
Primary Policies means any insurance policies issued by an
Insurance Subsidiary.
Pro Rata Share means as to any Lender at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at such
time of such Lender's Commitment divided by the combined Commitments of all
Lenders.
Purchase means the purchase by the Borrower of Nobel and certain
other operating subsidiaries and other certain assets of Nobel Insurance Limited
pursuant to the Purchase Agreement.
Purchase Agreement means the Stock Purchase Agreement dated
December 19, 1997 among the Borrower, the Guarantor, Nobel Insurance Limited and
Nobel Holdings, Inc. as in effect on the Effective Date.
Quarterly Statement means the quarterly financial statement of
any Insurance Subsidiary as required to be filed with the Department (or similar
Governmental Authority) of such Insurance Subsidiary's domicile, together with
all exhibits or schedules filed therewith, prepared in conformity with SAP.
Reinsurance Agreement means any arrangement whereby an insurance
company, the reinsurer, agrees to indemnify any Insurance Subsidiary against all
or a portion of the insurance or reinsurance risks underwritten by such
Insurance Subsidiary under any insurance policy.
Reportable Event means any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder other than any such event for
which the 30-day notice requirement under ERISA has been waived in regulations
issued by the PBGC.
Required Lenders means, at any time, Lenders then having at least
60% of the aggregate amount of the Revolving Commitments or, if the Commitments
have been terminated, Lenders then holding at least 60% of the then aggregate
unpaid principal amount of the Loans.
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Requirement of Law for any Person means the Organization
Documents of such Person, and any law, treaty, rule, ordinance 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.
Revolving Commitment Termination Date means the earliest to occur
of (a) the fifth anniversary of the Funding Date or (b) the date on which any
Commitment Termination Event occurs.
Revolving Credit Agreement means that certain Third Amended and
Restated Credit Agreement, dated as of December 12, 1996, as amended through the
Effective Date, among the Guarantor, the various financial institutions party
thereto from time to time and Bank of America National Trust & Savings
Association, as Administrative Agent for such lenders and as thereafter amended
in accordance with the Guaranty.
Revolving Loan - see Section 2.1(a).
Revolving Loan Commitment means as to any Lender the Commitment
of such Lender to make Revolving Loans pursuant to Section 2.1(a). The initial
amount of the Revolving Loan Commitment of each Lender is set forth on Schedule
2.1.
SAP means, as to each Insurance Subsidiary, the statutory
accounting practices prescribed or permitted by the Department (or other similar
authority) in such Insurance Subsidiary's domicile for the preparation of Annual
Statements and other financial reports by insurance corporations of the same
type as such Insurance Subsidiary.
Shareholders Agreement means the Shareholders Agreement dated as
of August 1, 1995 among the Guarantor, United States Fidelity and Guaranty
Company, Warburg, Pincus Investors, L.P., Trustees of the General Electric
Pension Trust and GE Investment Private Placement Partners I, Limited
Partnership.
S&P Claims Rating means the claims paying ability rating of
Renaissance Reinsurance Ltd. as determined from time to time by Standard &
Poor's Rating Group. If at any time no such rating shall be determined, it shall
be assumed to be below BBB+.
Statutory Financial Statements is defined in Section 4.2(a).
Subsidiary means a corporation of which the indicated Person
and/or its other Subsidiaries, individually or in the aggregate, own, directly
or indirectly, such number of
17
outstanding shares as have at the time of any determination hereunder more than
50% of the ordinary voting power. Unless otherwise specified, "Subsidiary" shall
mean a Subsidiary of the Borrower.
Taxes means 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 the Administrative Agent, such taxes
(including income taxes or franchise taxes) as are imposed on or measured by
each Lender's net income by the jurisdiction (or any political subdivision
thereof) under the laws of which such Lender or the Administrative Agent, as the
case may be, is organized or maintains a lending office.
Term Loan - see Section 2.1(b).
Term Loan Commitment means, as to any Lender, the Commitment of
such Lender to make Term Loans pursuant to Section 2.1(b). The initial amount of
the Term Loan Commitment of each Lender is set forth on Schedule 2.1.
Welfare Plan means any "employee welfare benefit plan" as such
term is defined in ERISA, as to which the Borrower has any liability.
SECTION 1.2 Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and means
"including without limitation."
(iii) In the computation of periods of time from a
specified date to a later specified date, the word "from" means "from
and including"; the words "to" and "until" each mean "to but excluding",
and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other
18
contractual instruments shall be deemed to include all subsequent amendments and
other modifications thereto, but only to the extent such amendments and other
modifications are not prohibited by the terms of any Loan Document, and (ii)
references to any statute or regulation are to be construed as including all
statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting the statute or regulation.
(e) The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation of this
Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Administrative
Agent, the Borrower and the other parties, and are the products of all parties.
Accordingly, they shall not be construed against the Lenders or the
Administrative Agent merely because of the Administrative Agent's or Lenders'
involvement in their preparation.
SECTION 1.3 Accounting Principles. Unless otherwise defined or the
context otherwise requires, all financial and accounting terms used herein or in
any of the Loan Documents or any certificate or other document made or delivered
pursuant hereto shall be defined in accordance with GAAP or SAP, as the context
may require. When used in this Agreement, the term "financial statements" shall
include the notes and schedules thereto. In addition, when used herein, the
terms "best knowledge of" or "to the best knowledge of" any Person shall mean
matters within the actual knowledge of such Person (or an Executive Officer or
general partner of such Person) or which should have been known by such Person
after reasonable inquiry.
ARTICLE II
AMOUNT AND TERMS OF COMMITMENT
SECTION 2.1 Commitments. Upon and subject to the terms and conditions
hereof, each of the Lenders severally and for itself agrees as follows:
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(a) Each Lender agrees to make revolving loans to the Borrower
(collectively called the "Revolving Loans" and individually called a "Revolving
Loan") from time to time on any Business Day during the period from the Funding
Date to the Revolving Commitment Termination Date, in an aggregate amount not to
exceed at any time outstanding the amount set forth on Schedule 2.1 under the
heading Revolving Loan Commitment for each respective Lender (such amount as the
same may be adjusted under Section 2.2 or as a result of one or more assignments
under Section 10.8, the Lender's "Revolving Loan Commitment"); provided,
however, that, after giving effect to any Borrowing, the aggregate principal
amount of all outstanding Revolving Loans shall not at any time exceed the
combined Revolving Loan Commitments. Within the limits of each Lender's
Revolving Loan Commitment, and subject to the other terms and conditions hereof,
the Borrower may borrow under this Section 2.1(a), prepay under Section 2.6 and
reborrow under this Section 2.1(a).
(b) Each Lender agrees to make a Term Loan to the Borrower
(collectively called the "Term Loans" and individually called a "Term Loan") on
the Funding Date in such Lender's Pro Rata Share of such aggregate amounts as
the Borrower may request from all Lenders under the Term Loan Commitments,
provided that the aggregate principal amount of all Term Loans shall not exceed
$35,000,000 and no Lender's Term Loan shall exceed its Term Loan Commitment.
Each Lender's Term Loan Commitment shall expire concurrently with the making of
such Lender's Term Loan.
SECTION 2.2 Termination or Reduction of Commitments. (a) The Borrower
may, upon not less than five Business Days' prior notice to the Administrative
Agent, terminate either Commitment, or permanently reduce either Commitment by
an aggregate minimum amount of $3,000,000 or any multiple of $500,000 in excess
thereof; unless, in the case of the Revolving Loan Commitment, after giving
effect thereto and to any prepayments of Revolving Loans to be made on the
effective date thereof, the then-outstanding principal amount of the Revolving
Loans would exceed the amount of the combined Revolving Loan Commitment then in
effect. Once reduced in accordance with this Section, the Commitments may not be
increased. Any reduction of the Commitments shall be applied to each Lender
according to its Pro Rata Share.
(b) Mandatory Commitment Reduction. On each date a Revolving
Loans Commitment reduction is required pursuant to Section 2.6(d), the Revolving
Loan Commitments shall, without any further action, automatically and
permanently be reduced by such amount.
SECTION 2.3 Loan Accounts. (a) The Loans made by each Lender shall be
evidenced by one or more loan accounts or records
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maintained by such Lender in the ordinary course of business. The loan accounts
or records maintained by each Lender shall be conclusive, absent manifest error,
of the amount of the Loans made by such Lender to the Borrower and the interest
and payments thereon. Any failure so to record or any error in doing so shall
not, however, limit or otherwise affect the obligation of the Borrower hereunder
to pay any amount owing with respect to the Loans.
(b) Upon the written request of any Lender made through the
Administrative Agent, the Loans made by such Lender may be evidenced by one or
more Notes, instead of loan accounts. Each such Lender shall endorse on the
schedules annexed to its Note(s) the date, amount and maturity of each Loan made
by it and the date and amount of each payment of principal made by the Borrower
with respect thereto. Each such Lender is irrevocably authorized by the Borrower
to endorse its Note(s) and each such Lender's Note shall be conclusive, absent
manifest error; provided, however, that the failure of a Lender to make, or an
error in making, a notation thereon with respect to any Loan shall not limit or
otherwise affect the obligations of the Borrower hereunder or under any such
Note to such Lender.
SECTION 2.4 Procedure for Borrowing. (a) Each Borrowing shall be made
upon the Borrower's irrevocable written notice delivered to the Administrative
Agent in the form of a Notice of Borrowing (which notice must be received by the
Administrative Agent prior to 9:00 a.m. (San Francisco time) (x) three Business
Days prior to the requested Borrowing Date, in the case of Offshore Rate Loans;
and (y) one Business Day prior to the requested Borrowing Date, in the case of
Base Rate Loans, specifying:
(i) the amount of the Borrowing, which shall be in an aggregate
minimum amount of $3,000,000 or any multiple of $500,000 in excess
thereof;
(ii) the requested Borrowing Date, which shall be a Business Day;
(iii) the Type of Loans comprising the Borrowing; and
(iv) the duration of the Interest Period applicable to any
Offshore Loans included in such notice. If the Notice of Borrowing fails
to specify the duration of the Interest Period for any Borrowing
comprised of Offshore Rate Loans, such Interest Period shall be three
months.
(b) The Administrative Agent will promptly notify each Lender of
its receipt of any Notice of Borrowing and of the amount of such Lender's Pro
Rata Share of that Borrowing.
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(c) Each Lender will make the amount of its Pro Rata Share of
each Borrowing available to the Administrative Agent for the account of the
Borrower at the Administrative Agent's Payment Office by 10:00 a.m. (San
Francisco time) on the Borrowing Date requested by the Borrower in funds
immediately available to the Administrative Agent. The proceeds of all such
Loans will then be made available to the Borrower by the Administrative Agent by
wire transfer in accordance with written instructions provided to the
Administrative Agent by the Borrower of like funds as received by the
Administrative Agent.
(d) After giving effect to any Borrowing, there may not be more
than five (5) different Interest Periods in effect.
SECTION 2.5 Conversion and Continuation Elections. (a) The Borrower may,
upon irrevocable written notice to the Administrative Agent in accordance with
Section 2.5(b):
(i) elect, as of any Business Day, in the case of Base Rate
Loans, or as of the last day of the applicable Interest Period, in the
case of any other Type of Loans, to convert any such Loans (or any part
thereof in an amount not less than $3,000,000, or that is in an integral
multiple of $500,000 in excess thereof) into Loans of any other Type; or
(ii) elect, as of the last day of the applicable Interest Period,
to continue any Loans having Interest Periods expiring on such day (or
any part thereof in an amount not less than $3,000,000, or that is in an
integral multiple of $500,000 in excess thereof);
provided, that if at any time the aggregate amount of Offshore Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $1,000,000, such Offshore Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the right
of the Borrower to continue such Loans as, and convert such Loans into, Offshore
Rate Loans shall terminate.
(b) The Borrower shall deliver a Notice of Conversion/
Continuation to be received by the Administrative Agent not later than 9:00 a.m.
(San Francisco time) at least (x) three Business Days in advance of the
Conversion/Continuation Date, if the Loans are to be converted into or continued
as Offshore Rate Loans; and (y) one Business Day in advance of the
Conversion/Continuation Date, if the Loans are to be converted into Base Rate
Loans, specifying:
(i) the proposed Conversion/Continuation Date;
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(ii) the aggregate amount of Loans to be converted or continued;
(iii) the Type of Loans resulting from the proposed conversion or
continuation; and
(iv) other than in the case of conversions into Base Rate Loans,
the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, the Borrower has failed to select timely a new Interest
Period to be applicable to such Offshore Rate Loans or if any Default or Event
of Default then exists, the Borrower shall be deemed to have elected to convert
such Offshore Rate Loans into Base Rate Loans effective as of the expiration
date of such Interest Period.
(d) The Administrative Agent will promptly notify each Lender of
its receipt of a Notice of Conversion/Continuation, or, if no timely notice is
provided by the Borrower, the Administrative Agent will promptly notify each
Lender of the details of any automatic conversion. All conversions and
continuations shall be made ratably according to the respective outstanding
principal amounts of the Loans with respect to which the notice was given held
by each Lender.
(e) After giving effect to any conversion or continuation of
Loans, there may not be more than five (5) different Interest Periods in effect.
(f) The Borrower may not select any Interest Period for a Term
Loan if, after giving effect to such selection, the Borrower would have to
prepay any Offshore Rate Loan in order to make any scheduled prepayment of such
Term Loan.
SECTION 2.6 Repayments. (a) Subject to Section 3.4, the Borrower may, at
any time or from time to time, upon not less than three (3) Business Days'
irrevocable notice to the Administrative Agent, ratably prepay Loans in whole or
in part, in minimum amounts of $1,000,000 or any multiple of $500,000 in excess
thereof. Such notice of prepayment shall specify the date and amount of such
prepayment and the Type(s) of Loans to be prepaid. The Administrative Agent will
promptly notify each Lender of its receipt of any such notice, and of such
Lender's Pro Rata Share of such prepayment. If such notice is given by the
Borrower, the Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein.
Term Loans once repaid may not be reborrowed. Prepayments of Term Loans shall be
applied in the inverse order of maturity.
23
(b) If at any time the aggregate outstanding principal amount of
the Revolving Loans shall exceed the Revolving Loan Commitment in effect at such
time, the Borrower shall make a principal repayment of the Revolving Loans in an
amount equal to such excess.
(c) The Borrower shall, immediately upon any acceleration of the
maturity date of the Loans pursuant to Section 7.2, repay the Loans.
(d) Within one Business Day after the Borrower receives any Net
Debt Proceeds, the Borrower shall repay the Loans and/or reduce the Revolving
Loan Commitment in an amount equal to such Net Debt Proceeds unless such payment
has been previously waived in writing by the Required Lenders. Net Debt Proceeds
shall be applied as follows: (i) Net Debt Proceeds shall be applied to repay
Term Loans (in the inverse order of maturity), and (ii) to the extent there are
any Net Debt Proceeds remaining after the application required pursuant to
clause (i), the Revolving Loan Commitment shall be reduced in an amount equal to
such unapplied Net Debt Proceeds and, to the extent such Revolving Loan
Commitment Reduction requires payment of Revolving Loans, the Net Debt Proceeds
shall be applied to such repayment.
(e) The Borrower shall repay to the Lenders on the Revolving
Commitment Termination Date the aggregate principal amount of Revolving Loans
outstanding on such date.
(f) The Borrower shall repay to the Lenders on each date set
forth below the aggregate principal amount of Term Loans set forth opposite such
date:
The Borrower shall repay to the Lenders on the Final Maturity Date the aggregate
principal amount of Term Loans outstanding on such date.
(g) Each prepayment of Offshore Rate Loans shall be accompanied
by payment of accrued interest to the date of prepayment on the amount prepaid
and amounts required pursuant to Section 3.4.
24
SECTION 2.7 Interest. (a) Each Loan shall bear interest on the
outstanding principal amount thereof from the applicable Borrowing Date at a
rate per annum equal to, the Offshore Rate or the Base Rate, as the case may be
(and subject to the Borrower's right to convert to other Types of Loans under
Section 2.5), plus the Applicable Margin.
(b) Interest on each Loan shall be paid in arrears on each
Interest Payment Date. Interest shall also be paid on the date of any prepayment
of Offshore Rate Loans under Section 2.6 for the portion of the Loans so prepaid
and upon payment (including prepayment) in full thereof and, during the
existence of any Event of Default, interest shall be paid on demand of the
Administrative Agent at the request or with the consent of the Required Lenders.
(c) Any change in the Applicable Margin or Applicable Non-Use Fee
Rate resulting from a change in the S & P Claims Rating shall be effective as of
the effective date of the change in the S & P Claims Rating. The Borrower agrees
promptly upon any change in the S & P Claims Rating to inform the Administrative
Agent thereof.
(d) Notwithstanding clause (a) of this Section, after
acceleration or, at the election of the Required Lenders while any Event of
Default exists, the Borrower shall pay interest (after as well as before entry
of judgment thereon to the extent permitted by law) on the principal amount of
all outstanding Obligations, at a rate per annum which is determined by adding
3% per annum to the Applicable Margin then in effect for such Loans and, in the
case of Obligations not subject to an interest rate, at a rate per annum equal
to the Base Rate plus 3%; provided, however, that, on and after the expiration
of any Interest Period applicable to any Offshore Rate Loan outstanding on the
date of occurrence of such Event of Default or acceleration, the principal
amount of such Loan shall, during the continuation of such Event of Default or
after acceleration, bear interest at a rate per annum equal to the Base Rate
plus 3%.
(e) Anything herein to the contrary notwithstanding, the
obligations of the Borrower to any Lender hereunder shall be subject to the
limitation that payments of interest shall not be required for any period for
which interest is computed hereunder, to the extent (but only to the extent)
that contracting for or receiving such payment by such Lender would be contrary
to the provisions of any law applicable to such Lender limiting the highest rate
of interest that may be lawfully contracted for, charged or received by such
Lender, and in such event the Borrower shall pay such Lender interest at the
highest rate permitted by applicable law.
25
SECTION 2.8 Fees. (a) Agent Fees. The Borrower shall pay fees to the
Administrative Agent for the Administrative Agent's own account, as required by
the letter agreement ("Fee Letter") between the Borrower and the Administrative
Agent dated February 23, 1998 and as the Borrower and the Administrative Agent
may agree from time to time.
(b) Non-Use Fees. The Borrower shall pay to the Administrative
Agent for the account of each Lender a non-use fee on the actual daily unused
portion of such Lender's Commitments, computed on a quarterly basis in arrears
on the last Business Day of each calendar quarter based upon the daily
utilization for that quarter as calculated by the Administrative Agent, equal to
the Applicable Non-Use Fee Rate. Such non-use fee shall accrue (x) in the case
of the Revolving Loan Commitments, from the Effective Date to the Revolving
Commitment Termination Date and shall be due and payable quarterly in arrears on
the last Business Day of each March, June, September and December commencing on
June 30, 1998 through the Revolving Commitment Termination Date, with the final
payment to be made on the Revolving Commitment Termination Date and (y) in the
case of the Term Loan Commitments, from the Effective Date to the Funding Date
and shall be due and payable on the Funding Date. The non- use fees provided in
this subsection shall accrue at all times after the above-mentioned commencement
date, including at any time during which one or more conditions in Article VIII
are not met.
SECTION 2.9 Computation of Fees and Interest. (a) All computations of
fees and interest (other than interest on Base Rate Loans) shall be made on the
basis of a 360-day year and actual days elapsed (which results in more interest
being paid than if computed on the basis of a 365-day year). Interest on Base
Rate Loans shall be computed on the basis of a 365/366-day year and actual days
elapsed. Interest and fees shall accrue during each period during which interest
or such fees are computed from the first day thereof to the last day thereof.
(b) Each determination of an interest rate by the Administrative
Agent shall be conclusive and binding on the Borrower and the Lenders in the
absence of manifest error.
SECTION 2.10 Payments by the Borrower. (a) All payments to be made by
the Borrower shall be made without set-off, recoupment or counterclaim. Except
as otherwise expressly provided herein, all payments by the Borrower shall be
made to the Administrative Agent for the account of the Lenders at the
Administrative Agent's Payment Office, and shall be made in Dollars and in
immediately available funds, no later than 10:00 a.m. (San Francisco time) on
the date specified herein. The Administrative Agent will promptly distribute to
each Lender its
26
Pro Rata Share (or other applicable share as expressly provided herein) of such
payment in like funds as received. Any payment received by the Administrative
Agent later than 10:00 a.m. (San Francisco time) shall be deemed to have been
received on the following Business Day and any applicable interest or fee shall
continue to accrue to such Business Day.
(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and such
extension of time shall in such case be included in the computation of interest
or fees, as the case may be.
(c) Unless the Administrative Agent receives notice from the
Borrower prior to the date on which any payment is due to the Lenders that the
Borrower will not make such payment in full as and when required, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date in immediately available funds and the
Administrative Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent the Borrower has not made such
payment in full to the Administrative Agent, each Lender shall repay to the
Administrative Agent on demand such amount distributed to such Lender, together
with interest thereon at the Federal Funds Rate for each day from the date such
amount is distributed to such Lender until the date repaid.
SECTION 2.11 Payments by the Lenders to the Administrative Agent. (a)
Unless the Administrative Agent receives notice from a Lender on or prior to the
Effective Date or, with respect to any Borrowing after the Effective Date, at
least one Business Day prior to the date of such Borrowing, that such Lender
will not make available as and when required hereunder to the Administrative
Agent for the account of the Borrower the amount of that Lender's Pro Rata Share
of the Borrowing, the Administrative Agent may assume that each Lender has made
such amount available to the Administrative Agent in immediately available funds
on the Borrowing Date and the Administrative Agent may (but shall not be so
required), in reliance upon such assumption, make available to the Borrower on
such date a corresponding amount. If and to the extent any Lender shall not have
made its full amount available to the Administrative Agent in immediately
available funds and the Administrative Agent in such circumstances has made
available to the Borrower such amount, that Lender shall on the Business Day
following such Borrowing Date make such amount available to the Administrative
Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice of the Administrative Agent
27
submitted to any Lender with respect to amounts owing under this subsection (a)
shall be conclusive, absent manifest error. If such amount is so made available,
such payment to the Administrative Agent shall constitute such Lender's Loan on
the date of Borrowing for all purposes of this Agreement. If such amount is not
made available to the Administrative Agent on the Business Day following the
Borrowing Date, the Administrative Agent will notify the Borrower of such
failure to fund and, upon demand by the Administrative Agent, the Borrower shall
pay such amount to the Administrative Agent for the Administrative Agent's
account, together with interest thereon for each day elapsed since the date of
such Borrowing, at a rate per annum equal to the interest rate applicable at the
time to the Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any Borrowing
Date shall not relieve any other Lender of any obligation hereunder to make a
Loan on such Borrowing Date, but no Lender shall be responsible for the failure
of any other Lender to make the Loan to be made by such other Lender on any
Borrowing Date.
SECTION 2.12 Sharing of Payments, Etc. If, other than as expressly
provided elsewhere herein, any Lender shall obtain on account of the Loans made
by it any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) in excess of its Pro Rata Share, such Lender
shall immediately (a) notify the Administrative Agent of such fact, and (b)
purchase from the other Lenders such participations in the Loans made by them as
shall be necessary to cause such purchasing Lender to share the excess payment
pro rata with each of them; provided, however, that if all or any portion of
such excess payment is thereafter recovered from the purchasing Lender, such
purchase shall to that extent be rescinded and each other Lender shall repay to
the purchasing Lender the purchase price paid therefor, together with an amount
equal to such paying Lender's ratable share (according to the proportion of (i)
the amount of such paying 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 a participation from another
Lender may, to the fullest extent permitted by law, exercise all its rights of
payment (including the right of set-off, but subject to Section 10.10) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation. The Administrative
Agent will keep records (which shall be conclusive and binding in the absence of
manifest error) of participations purchased under this Section and will in each
case notify the Lenders following any such purchases or repayments.
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ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
SECTION 3.1 Taxes. (a) Any and all payments by the Borrower to each
Lender or the Administrative Agent under this Agreement and any other Loan
Document shall be made free and clear of, and without deduction or withholding
for any Taxes. In addition, the Borrower shall pay all Other Taxes.
(b) The Borrower agrees to indemnify and hold harmless each
Lender and the Administrative Agent for the full amount of Taxes or Other Taxes
(including any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable under this Section) paid by the Lender or the Administrative Agent and
any liability (including penalties, interest, additions to tax and expenses)
arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted. Payment under this indemnification
shall be made within 30 days after the date the Lender or the Administrative
Agent makes written demand therefor.
(c) If the Borrower shall be required by law to deduct or
withhold any Taxes or Other Taxes from or in respect of any sum payable
hereunder to any Lender or the Administrative Agent, then:
(i) the sum payable shall be increased as necessary so that after
making all required deductions and withholdings (including deductions
and withholdings applicable to additional sums payable under this
Section) such Lender or the Administrative Agent, as the case may be,
receives an amount equal to the sum it would have received had no such
deductions or withholdings been made;
(ii) the Borrower shall make such deductions and withholdings;
(iii) the Borrower shall pay the full amount deducted or withheld
to the relevant taxing authority or other authority in accordance with
applicable law; and
(iv) the Borrower shall also pay, without duplication, to each
Lender or the Administrative Agent for the account of such Lender, at
the time interest is paid, all additional amounts which the respective
Lender specifies as necessary to preserve the after-tax yield the Lender
would have received if such Taxes or Other Taxes had not been imposed.
29
(d) Within 30 days after the date of any payment by the Borrower
of Taxes or Other Taxes, the Borrower shall furnish the Administrative Agent the
original or a certified copy of a receipt evidencing payment thereof, or other
evidence of payment satisfactory to the Administrative Agent.
(e) If the Borrower is required to pay additional amounts to any
Lender or the Administrative Agent pursuant to Section 3.1(c), then such Lender
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to change the jurisdiction of its Lending Office so as to eliminate any such
additional payment by the Borrower which may thereafter accrue, if such change
in the judgment of such Lender is not otherwise disadvantageous to such Lender
or inconsistent with such Lender's internal policies.
SECTION 3.2 Illegality. (a) If any Lender determines that the
introduction of any Requirement of Law, or any change in any Requirement of Law,
or in the interpretation or administration of any Requirement of Law, has made
it unlawful, or that any central bank or other Governmental Authority has
asserted that it is unlawful, for any Lender or its applicable Lending Office to
make Offshore Rate Loans, then, on notice thereof by the Lender to the Borrower
through the Administrative Agent, any obligation of that Lender to make Offshore
Rate Loans shall be suspended until the Lender notifies the Administrative Agent
and the Borrower that the circumstances giving rise to such determination no
longer exist.
(b) If a Lender determines that it is unlawful to maintain any
Offshore Rate Loan, the Borrower shall, upon its receipt of notice of such fact
and demand from such Lender (with a copy to the Administrative Agent), prepay in
full such Offshore Rate Loans of that Lender then outstanding, together with
interest accrued thereon and amounts required under Section 3.4, either on the
last day of the Interest Period thereof, if the Lender may lawfully continue to
maintain such Offshore Rate Loans to such day, or immediately, if the Lender may
not lawfully continue to maintain such Offshore Rate Loan. If the Borrower is
required to so prepay any Offshore Rate Loan, then concurrently with such
prepayment, the Borrower shall borrow from the affected Lender, in the amount of
such repayment, a Base Rate Loan.
(c) If the obligation of any Lender to make or maintain Offshore
Rate Loans has been so terminated or suspended, the Borrower may elect, by
giving notice to the Lender through the Administrative Agent that all Loans
which would otherwise be made by the Lender as Offshore Rate Loans shall be
instead Base Rate Loans.
30
(d) Before giving any notice to the Administrative Agent under
this Section, the affected Lender shall designate a different Lending Office
with respect to its Offshore Rate Loans if such designation will avoid the need
for giving such notice or making such demand and will not, in the judgment of
the Lender, be illegal or otherwise disadvantageous to the Lender or
inconsistent with such Lender's internal policies.
SECTION 3.3 Increased Costs and Reduction of Return. (a) If any Lender
determines that, due to either (i) the introduction of or any change (other than
any change by way of imposition of or increase in reserve requirements included
in the calculation of the Offshore Rate) in or in the interpretation of any law
or regulation or (ii) the compliance by that Lender 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 such Lender
of agreeing to make or making, funding or maintaining any Offshore Rate Loans,
then the Borrower shall be liable for, and shall from time to time, upon demand
(with a copy of such demand to be sent to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender, additional amounts as are
sufficient to compensate such Lender for such increased costs; provided that the
Borrower shall not be obligated to pay any additional amounts which were
incurred by such Lender more than 90 days prior to the date of such request.
(b) If any Lender shall have determined that (i) the introduction
of any Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or (iv) compliance by
the Lender (or its Lending Office) or any corporation controlling the Lender
with any Capital Adequacy Regulation, affects or would affect the amount of
capital required or expected to be maintained by the Lender or any corporation
controlling the Lender and (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy and such Lender's
desired return on capital) determines that the amount of such capital is
increased or its rate of return is decreased as a consequence of its Commitment,
loans, credits or obligations under this Agreement, then, upon demand of such
Lender to the Borrower through the Administrative Agent, the Borrower shall pay
to the Lender, from time to time as specified by the Lender, additional amounts
sufficient to compensate the Lender for such increase; provided that the
Borrower shall not be obligated to pay any additional amounts which were
incurred by such Lender more than 90 days prior to the date of such request.
31
SECTION 3.4 Funding Losses. The Borrower shall reimburse each Lender and
hold each Lender harmless from any loss or expense which the Lender may sustain
or incur as a consequence of:
(a) the failure of the Borrower to make on a timely basis any
payment of principal of any Offshore Rate Loan;
(b) the failure of the Borrower to borrow, continue or convert a
Loan after the Borrower has given (or is deemed to have given) a Notice of
Borrowing or a Notice of Conversion/ Continuation that includes an Offshore Rate
Loan;
(c) the failure of the Borrower to make any prepayment in
accordance with any notice delivered under Section 2.6;
(d) the prepayment (including pursuant to Section 2.6) or other
payment (including after acceleration thereof) of an Offshore Rate Loan on a day
that is not the last day of the relevant Interest Period; or
(e) the automatic conversion under Section 2.5 of any Offshore
Rate Loan to a Base Rate Loan on a day that is not the last day of the relevant
Interest Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained. For purposes of
calculating amounts payable by the Borrower to the Lenders under this Section
and under Section 3.3(a), each Offshore Rate Loan made by a Lender (and each
related reserve, special deposit or similar requirement) shall be conclusively
deemed to have been funded at the IBOR used in determining the Offshore Rate for
such Offshore Rate Loan by a matching deposit or other borrowing in the
interbank eurodollar market for a comparable amount and for a comparable period,
whether or not such Offshore Rate Loan is in fact so funded.
SECTION 3.5 Inability to Determine Rates. If the Administrative Agent
determines that for any reason adequate and reasonable means do not exist for
determining the Offshore Rate for any requested Interest Period with respect to
a proposed Offshore Rate Loan, or the Administrative Agent determines (or the
Required Lenders advise the Administrative Agent) that the Offshore Rate
applicable pursuant to Section 2.7(a) for any requested Interest Period with
respect to a proposed Offshore Rate Loan does not adequately and fairly reflect
the cost to the Lenders of funding such Loan, the Administrative Agent will
promptly so notify the Borrower and each Lender. Thereafter, the obligation of
the Lenders to make or maintain Offshore Rate
32
Loans, as the case may be, hereunder shall be suspended until the Administrative
Agent revokes such notice in writing. Upon receipt of such notice, the Borrower
may revoke any Notice of Borrowing or Notice of Conversion/ Continuation then
submitted by it. If the Borrower does not revoke such Notice, the Lenders shall
make, convert or continue the Loans, as proposed by the Borrower, in the amount
specified in the applicable notice submitted by the Borrower, but such Loans
shall be made, converted or continued as Base Rate Loans instead of Offshore
Rate Loans.
SECTION 3.6 Certificates of Lenders. Any Lender claiming reimbursement
or compensation under this Article III shall deliver to the Borrower (with a
copy to the Administrative Agent) a certificate setting forth in reasonable
detail the amount payable to the Lender hereunder and such certificate shall be
conclusive and binding on the Borrower in the absence of manifest error.
SECTION 3.7 Substitution of Lenders. Upon the receipt by the Borrower
from any Lender (an "Affected Lender") of a claim for compensation under Section
3.1, 3.2 or 3.3 the Borrower may: (i) request the Affected Lender to use its
reasonable efforts to obtain a replacement bank or financial institution
satisfactory to the Borrower to acquire and assume all or a ratable part of all
of such Affected Lender's Loans and Commitment (a "Substitute Lender"); (ii)
request one more of the other Lenders to acquire and assume all or part of such
Affected Lender's Loans and Commitment; or (iii) designate a Substitute Lender.
Any such designation of a Substitute Lender under clause (i) or (iii) shall be
subject to the prior written consent of the Administrative Agent (which consent
shall not be unreasonably withheld).
SECTION 3.8 Survival. The agreements and obligations of the Borrower in
this Article III shall survive the payment of all other Obligations.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Agreement and to make
Loans hereunder, the Borrower represents and warrants (provided that for
purposes of giving representations and warranties prior to the date the Purchase
has been consummated, the Borrower has assumed that the Purchase has been
consummated in accordance with the terms of the Purchase Agreement) to each
Lender that:
33
SECTION 4.1 Due Organization, Authorization, etc. Each of the Borrower
and each Subsidiary (a) is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation, (b) is duly
qualified to do business and in good standing in each jurisdiction where,
because of the nature of its activities or properties, such qualification is
required except where the failure to qualify would not have a Material Adverse
Effect, which jurisdictions are set forth with respect to the Borrower and each
Subsidiary on Schedule 4.1 as revised from time to time by the Borrower pursuant
to Section 5.1(l), (c) has the requisite corporate power and authority and the
right to own and operate its properties, to lease the property it operates under
lease, and to conduct its business as now and proposed to be conducted, and (d)
has obtained all material licenses, permits, consents or approvals from or by,
and has made all filings with, and given all notices to, all Governmental
Authorities having jurisdiction, to the extent required for such ownership,
operation and conduct (including, without limitation, the consummation of the
transactions contemplated by this Agreement) as to each of the foregoing, except
where the failure to do so would not have a Material Adverse Effect. The
execution, delivery and performance by the Borrower of this Agreement and the
consummation of the transactions contemplated hereby and thereby are within its
corporate powers and have been duly authorized by all necessary corporate action
(including, without limitation, shareholder approval, if required). Each of the
Borrower and its Subsidiaries has received all other material consents and
approvals (if any shall be required) necessary for such execution, delivery and
performance, and such execution, delivery and performance do not and will not
contravene or conflict with, or create a Lien or right of termination or
acceleration under, any Requirement of Law or Contractual Obligation binding
upon the Borrower or such Subsidiaries. This Agreement and each of the Loan
Documents to which the Borrower is a party is (or when executed and delivered
will be) the legal, valid, and binding obligation of the Borrower enforceable
against the Borrower in accordance with its respective terms; provided that the
Borrower assumes for purposes of this Section 4.1 that this Agreement and the
other Loan Documents have been validly executed and delivered by each of the
parties thereto other than the Borrower.
SECTION 4.2 Statutory Financial Statements. (a) The Annual Statement and
the March 31, 1998 Quarterly Statement of each of the Insurance Subsidiaries
(including, without limitation, the provisions made therein for investments and
the valuation thereof, reserves, policy and contract claims and statutory
liabilities) as filed with the appropriate Governmental Authority of its
jurisdiction of domicile (the "Department") and delivered to each Lender prior
to the execution and delivery of this Agreement, as of and for the 1997 Fiscal
Year and the Fiscal
34
Quarter ended March 31, 1998, (collectively the "Statutory Financial
Statements"), have been prepared in accordance with SAP applied on a consistent
basis (except as noted therein). Each such Statutory Financial Statement was in
compliance with applicable law when filed. To the best of the Borrower's
knowledge, the 1997 Fiscal Year and the March 31, 1998 Statutory Financial
Statements fairly present the financial position, the results of operations and
changes in equity of each such Insurance Subsidiary as of and for the respective
dates and periods indicated therein in accordance with SAP applied on a
consistent basis, except as set forth in the notes thereto or on Schedule
4.2(a). Except for liabilities and obligations, including, without limitation,
reserves, policy and contract claims and statutory liabilities (all of which
have been computed in accordance with SAP), disclosed or provided for in the
Statutory Financial Statements, the Insurance Subsidiaries did not have, as of
the respective dates of each of such financial statements, any liabilities or
obligations (whether absolute or contingent and whether due or to become due)
which, in conformity with SAP, applied on a consistent basis, would have been
required to be or should be disclosed or provided for in such financial
statements. All books of account of each of the Insurance Subsidiaries fully and
fairly disclose all of the transactions, properties, assets, investments,
liabilities and obligations of such Insurance Subsidiary and all of such books
of account are in the possession of each such Insurance Subsidiary and are true,
correct and complete in all material respects.
(b) With respect to any representation and warranty with respect
to the 1997 Fiscal Year and the March 31, 1998 Statutory Financial Statements,
such representation and warranty is to the best of the Borrower's knowledge.
With respect to any representation and warranty which is deemed to be made after
the date hereof by the Borrower, references to the Statutory Financial
Statements shall refer to the Statutory Financial Statements which as of such
date shall have most recently been furnished by or on behalf of the Insurance
Subsidiaries to each Lender pursuant to this Agreement.
(c) Except as set forth on Schedule 4.2(c), there has been no
change in the business, assets, operations or financial condition of the
Borrower or any Subsidiary which has had or could reasonably be expected to have
a Material Adverse Effect since December 31, 1997.
SECTION 4.3 GAAP Financial Statements. (a) The Borrower has heretofore
furnished to the Lenders the consolidated financial statements of Nobel
Insurance Limited and its Subsidiaries for the Fiscal Year ending December 31,
1997 and the Fiscal Quarter ending March 31, 1998. To the best of the Borrower's
knowledge, such financial statements are free of
35
material misstatement and present fairly, in all material respects, the
consolidated financial condition of Nobel Insurance Limited and its Subsidiaries
at such dates.
(b) With respect to any representation and warranty which is
deemed to be made after the date hereof by the Borrower, the balance sheet and
statements of operations, of shareholders' equity and of cash flow, which as of
such date shall most recently have been furnished by or on behalf of the
Borrower to each Lender for the purposes of or in connection with this Agreement
or any transaction contemplated hereby, shall have been prepared in accordance
with GAAP consistently applied (except as disclosed therein and, in the case of
interim financial statements, for the absence of footnote disclosures), and
shall present fairly the consolidated financial condition of the corporations
covered thereby as at the dates thereof for the periods then ended, subject, in
the case of quarterly financial statements, to normal year-end audit
adjustments.
(c) The forecasted cash flow statement of the Borrower and its
Subsidiaries (after giving effect to the Purchase and the borrowings hereunder),
copies of which have been delivered to each Lender, have been prepared by the
Borrower in light of the past operations of the business of Nobel Insurance
Limited and its Subsidiaries and represent, as of the date of this Agreement,
the good faith estimate of the Borrower and its senior management for the most
probable course of the business of the Borrower and its Subsidiaries after
giving effect to such transactions.
SECTION 4.4 Litigation and Contingent Liabilities. (a) Except as set
forth (including estimates of the dollar amounts involved) in Schedule 4.4
hereto and (b) except for claims which are covered by Insurance Policies,
coverage for which has not been denied in writing, or which relate to Primary
Policies or Borrower Reinsurance Agreements issued by the Borrower or its
Insurance Subsidiaries or to which it is a party entered into by the Borrower or
its Insurance Subsidiaries in the ordinary course of business (referred to
herein as "Ordinary Course Litigation"), no claim, litigation (including,
without limitation, derivative actions), arbitration, governmental investigation
or proceeding or inquiry is pending or, to its knowledge, threatened against the
Borrower or any of its Subsidiaries (i) which would, if adversely determined,
have a Material Adverse Effect or (ii) which relates to any of the transactions
contemplated hereby, and there is no basis known to the Borrower for any of the
foregoing. Other than any liability incident to such claims, litigation or
proceedings, the Borrower has no material Contingent Liabilities not provided
for or referred to in the financial statements delivered pursuant to Section
4.3.
36
SECTION 4.5 Employee Benefit Plans. Set forth on Schedule 4.5 as revised
from time to time by the Borrower pursuant to Section 5.1(l) is a list of all
Plans and all Multiemployer Plans respectively, which, to the knowledge of the
Borrower, are maintained with respect to employees of the Borrower or its
Subsidiaries.
SECTION 4.6 Investment Company Act. Neither the Borrower nor any of its
Subsidiaries is an "investment company" or a company "controlled by an
investment company," within the meaning of the Investment Company Act of 1940,
as amended.
SECTION 4.7 Regulations U and X. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying
margin stock. None of the Borrower, any of its Subsidiaries, any Affiliate of
any of them or any Person acting on their behalf has taken or will take action
to cause the execution, delivery or performance of this Agreement, the making or
existence of the Loans or the use of proceeds of the Loans to violate
Regulations U or X of the FRB.
SECTION 4.8 Proceeds. The proceeds of the Term Loans will be used to
finance the Purchase and the costs associated therewith. The proceeds of the
Revolving Loans will be used for general corporate purposes (including capital
contributions to Subsidiaries and acquisitions permitted under Section 6.3).
None of such proceeds will be used in violation of applicable law, and none of
such proceeds will be used, directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of buying or carrying any margin stock as
defined in Regulation U of the FRB.
SECTION 4.9 Insurance. Schedule 4.9 as revised from time to time by the
Borrower pursuant to Section 5.1(l) sets forth a true and correct summary of all
Insurance Policies. No notice of any pending or threatened cancellation or
premium increase has been received by the Borrower or its Subsidiaries with
respect to any such Insurance Policies. The Borrower and its Subsidiaries are in
substantial compliance with all material conditions contained in such Insurance
Policies.
SECTION 4.10 Ownership of Properties. On the date of any Loan, the
Borrower and its Subsidiaries will have good title to all of their respective
material properties and assets, real and personal, of any nature whatsoever.
SECTION 4.11 Business Locations. Schedule 4.11 as revised from time to
time by the Borrower pursuant to Section 5.1(l) lists each of the locations
where the Borrower maintains an office, a place of business or any records.
37
SECTION 4.12 Accuracy of Information. All factual written information
furnished heretofore or contemporaneously herewith by or on behalf of the
Borrower or any of its Subsidiaries to the Administrative Agent or the Lenders
for purposes of or in connection with this Agreement, the Purchase or any of the
transactions contemplated hereby, as supplemented to the date hereof, is and all
other such factual written information hereafter furnished by or on behalf of
the Borrower or any of its Subsidiaries to the Administrative Agent or the
Lenders will be, true and accurate in every material respect on the date as of
which such information is dated or certified and not incomplete by omitting to
state any material fact necessary to make such information not misleading;
provided, however, that with respect to information provided by the Borrower
with respect to Nobel (including its Statutory Financial Statements or GAAP
financial statements) and other information relating to the Purchase, the
Borrower's representation hereunder is to the best of its knowledge.
SECTION 4.13 Subsidiaries. Schedule 4.13 as updated from time to time
pursuant to Section 5.1(l) contains a complete list of the Borrower's
Subsidiaries and designates each such Subsidiary as an Insurance Subsidiary or a
Non-Insurance Subsidiary.
SECTION 4.14 Insurance Licenses. Schedule 4.14 as revised from time to
time by the Borrower pursuant to Section 5.1(l) lists all of the jurisdictions
in which any of the Insurance Subsidiaries hold licenses (including, without
limitation, licenses or certificates of authority from applicable insurance
departments), permits or authorizations to transact insurance business
(collectively, the "Licenses"). Except as set forth on Schedule 4.14, to the
best of the Borrower's knowledge, no such License is the subject of a proceeding
for suspension or revocation or any similar proceedings, there is no sustainable
basis for such a suspension or revocation, and no such suspension or revocation
is threatened by the Department. Schedule 4.14 as revised from time to time by
the Borrower pursuant to Section 5.1(l) indicates the line or lines of insurance
which each such Insurance Subsidiary is permitted to be engaged in with respect
to each License therein listed. The Insurance Subsidiaries do not transact any
insurance business, directly or indirectly, in any jurisdiction other than those
enumerated on Schedule 4.14 as revised from time to time by the Borrower
pursuant to Section 5.1(l) hereto, where such business requires that any such
Insurance Subsidiary obtain any license, permit, governmental approval, consent
or other authorization.
SECTION 4.15 Taxes. The Borrower and each of its Subsidiaries has filed
all tax returns that are required to be filed by it, and has paid or provided
adequate reserves for the
38
payment of all material taxes, including, without limitation, all payroll taxes
and federal and state withholding taxes, and all assessments payable by it that
have become due, other than (a) those that are not yet delinquent or that are
disclosed on Schedule 4.15 or that are being contested in good faith by
appropriate proceedings and with respect to which reserves have been
established, and are being maintained, in accordance with GAAP or (b) those
which the failure to file or pay would not have a Material Adverse Effect.
Except as set forth in Schedule 4.15, on the Effective Date there is no ongoing
audit or, to the Borrower's knowledge, other governmental investigation of the
tax liability of the Borrower or any of its Subsidiaries and there is no
unresolved claim by a taxing authority concerning the Borrower's or any such
Subsidiary's tax liability, for any period for which returns have been filed or
were due. As used in this Section 4.15, the term "taxes" includes all taxes of
any nature whatsoever and however denominated, including, without limitation,
excise, import, governmental fees, duties and all other charges, as well as
additions to tax, penalties and interest thereon, imposed by any government or
instrumentality, whether federal, state, local, foreign or other.
SECTION 4.16 Securities Laws. Neither the Borrower nor any Affiliate,
nor anyone acting on behalf of any such Person, has directly or indirectly
offered any interest in the Loans or any other Obligation for sale to, or
solicited any offer to acquire any such interest from, or has sold any such
interest to any Person that would subject the issuance or sale of the Loans or
any other liability to registration under the Securities Act of 1933, as
amended.
SECTION 4.17 Compliance with Laws. Neither the Borrower nor any of its
Subsidiaries is in violation of any law, ordinance, rule, regulation, order,
policy, guideline or other requirement of any Governmental Authority, if the
effect of such violation could reasonably be expected to have a Material Adverse
Effect and, to the best of the Borrower's knowledge, no such violation has been
alleged and each of the Borrower and its Subsidiaries (i) has filed in a timely
manner all reports, documents and other materials required to be filed by it
with any Governmental Authority, if such failure to so file could reasonably be
expected to have a Material Adverse Effect; and the information contained in
each of such filings is true, correct and complete in all material respects and
(ii) has retained all records and documents required to be retained by it
pursuant to any law, ordinance, rule, regulation, order, policy, guideline or
other requirement of any Governmental Authority, if the failure to so retain
such records and documents could reasonably be expected to have a Material
Adverse Effect.
39
SECTION 4.18 Year 2000 Issues. The Borrower and its Subsidiaries have
developed and implemented a comprehensive, detailed program to address on a
timely basis the "Year 2000 Problem" (that is the risk that computer
applications used by the Borrower or its Subsidiaries may be unable to recognize
and perform properly date-sensitive functions involving certain dates prior and
any date after December 31, 1999) and reasonably anticipates that it will on a
timely basis successfully resolve the Year 2000 Problem for all material
computer applications used by the Borrower or any of its Subsidiaries. The
Borrower believes, based upon inquiry made, that each supplier and vendor of the
Borrower and its Subsidiaries that is of material importance to the financial
well being of the Borrower and its Subsidiaries taken as a whole will also
successfully resolve on a timely basis the Year 2000 Problem for all of its
material computer applications.
SECTION 4.19 Purchase. The Purchase will be consummated substantially in
accordance with the terms of the Purchase Agreement and will comply in all
respects with all applicable legal requirements. All necessary governmental,
regulatory, shareholder and other consents and approvals required for the
consummation of the Purchase will be, prior to the consummation thereof, duly
obtained and in full force and effect.
ARTICLE V
AFFIRMATIVE COVENANTS
Until the Loans and all other Obligations are paid in full, and
until the Revolving Commitment Termination Date, the Borrower agrees that,
unless at any time the Required Lenders shall otherwise expressly consent in
writing, it will:
SECTION 5.1 Reports, Certificates and Other Information. Furnish or
cause to be furnished to the Administrative Agent and the Lenders:
(a) GAAP Financial Statements:
(i) Within 50 days after the close of each of the first three
Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the
unaudited consolidated and consolidating balance sheets of the Borrower
and its Subsidiaries, as of the close of such quarter and the related
consolidated and consolidating statements of income and cash flows for
that portion of the Fiscal Year ending as of the close of such Fiscal
Quarter, all prepared in accordance with GAAP (subject to normal
year-end adjustments and except that footnote and
40
schedule disclosure may be abbreviated) and accompanied by the
certification of the chief executive officer, chief financial officer or
treasurer of the Borrower that all such financial statements are
complete and correct and present fairly in accordance with GAAP (subject
to normal year-end adjustments) the consolidated results of operations
and cash flows of the Borrower as at the end of such Fiscal Quarter and
for the period then ended.
(ii) Within 95 days after the close of each Fiscal Year, (A) a
copy of the annual audited consolidated financial statements of the
Borrower and its Subsidiaries, consisting of consolidated balance sheets
and consolidated statements of income and retained earnings and cash
flows, setting forth in comparative form in each case the consolidated
figures for the previous Fiscal Year, which financial statements shall
be prepared in accordance with GAAP, certified without material
qualification (including any Year 2000 Problem) by the independent
certified public accountants regularly retained by the Borrower, or any
other firm of independent certified public accountants of recognized
national standing selected by the Borrower and reasonably acceptable to
the Required Lenders that all such financial statements are complete and
correct and present fairly in accordance with GAAP the consolidated
financial position and the consolidated results of operations and cash
flows of the Borrower and its Subsidiaries as at the end of such Fiscal
Year and for the period then ended and (B) a copy of the consolidating
balance sheets and consolidating statements of income and retained
earnings and cash flows for the Borrower and its Subsidiaries as of the
end of such Fiscal Year, accompanied by the certificate of the chief
executive officer, chief financial officer or treasurer of the Borrower
that all such consolidating financial statements are complete and
correct and present fairly the results of operations and cash flows of
the Borrower as at the end of such Fiscal Year and for the period then
ended.
(b) Tax Returns. If requested by the Administrative Agent, copies
of all federal, state, local and foreign tax returns and reports in respect of
income, franchise or other taxes on or measured by income (excluding sales, use
or like taxes) filed by the Borrower or any of its Subsidiaries.
(c) SAP Financial Statements. Within (i) 5 days after the date
filed with the Department for each of its Fiscal Years,
41
but in any event within 125 days after the end of each Fiscal Year of each
Insurance Subsidiary a copy of the Annual Statement of each Insurance Subsidiary
for such Fiscal Year and (ii) 5 days after the date filed with any Department
for each of its Fiscal Quarters, but in any event within 60 days after the end
of each Fiscal Quarter of each Insurance Subsidiary a copy of the Quarterly
Statement of each Insurance Subsidiary for such Fiscal Quarter, if any, required
by such Department to be filed, each of which statements delivered pursuant to
clause (i) or (ii) to be prepared in accordance with SAP and accompanied by the
certification of the chief financial officer or chief executive officer of each
Insurance Subsidiary that such financial statement is complete and correct and
presents fairly in accordance with SAP the financial position of such Insurance
Subsidiary for the period then ended.
(d) Notice of Default, etc. Immediately after an Executive
Officer of the Borrower knows or has reason to know of the existence of any
Default, or any development or other information which would have a Material
Adverse Effect, telephonic or telegraphic notice specifying the nature of such
Default or development or information, including the anticipated effect thereof,
which notice shall be promptly confirmed in writing within two (2) Business
Days.
(e) Other Information. The following certificates and other
information related to the Borrower:
(i) Promptly after completion of each such item but in no event
later than the 95th day after the close of each Fiscal Year of the
Borrower, a copy of the Borrower's business plan.
(ii) Within five (5) Business Days of receipt, a copy of any
financial examination reports by a Governmental Authority with respect
to the Insurance Subsidiaries relating to the insurance business of the
Insurance Subsidiaries (when, and if, prepared); provided, the Borrower
shall only be required to deliver any interim report hereunder at such
time as Borrower has knowledge that a final report will not be issued
and delivered to the Administrative Agent within 90 days of any such
interim report.
(iii) Copies of all filings (other than nonmaterial tax filings)
with Governmental Authorities by the Borrower or any Subsidiary not
later than five (5) Business Days after such filings are made,
including, without limitation, filings which seek approval of
Governmental Authorities with respect to
42
transactions between the Borrower or such Subsidiary and its Affiliates.
(iv) Within five (5) Business Days of such notice, notice of
proposed or actual suspension, termination or revocation of any material
License of the Insurance Subsidiaries by any Governmental Authority or
of receipt of notice from any Governmental Authority notifying the
Borrower of a hearing relating to such a suspension, termination or
revocation, including any request by a Governmental Authority which
commits the Borrower or any Insurance Subsidiary to take, or refrain
from taking, any action or which otherwise materially and adversely
affects the authority of the Borrower or any Insurance Subsidiary to
conduct its business.
(v) Within five (5) Business Days of such notice, notice of any
pending or threatened investigation or regulatory proceeding (other than
routine periodic investigations or reviews) by any Governmental
Authority concerning the business, practices or operations of the
Borrower or any Insurance Subsidiary.
(vi) Simultaneously with delivery of the financial statements
provided pursuant to Section 5.1(a)(i), a list of all investments
(including, without limitation, Permitted Investments) of the Borrower
and its Insurance Subsidiaries as of the end of such Fiscal Quarter.
(vii) Promptly, notice of any actual or, to the best of the
Borrower's knowledge, proposed material changes in the Insurance Code
governing the investment or dividend practices of any Insurance
Subsidiary.
(viii) Promptly, such additional financial and other information
as the Administrative Agent may from time to time reasonably request.
(f) Compliance Certificates. Concurrently with the delivery to
the Administrative Agent of the GAAP financial statements under Sections
5.1(a)(i) and 5.1(a)(ii), for each Fiscal Quarter and Fiscal Year of the
Borrower, and at any other time no later than thirty (30) Business Days
following a written request of the Administrative Agent, a duly completed
Compliance Certificate, signed by the chief financial officer or treasurer of
the Borrower, containing, among other things, a computation of, and showing
compliance with, each of the applicable financial ratios and restrictions
contained in Sections 6.1, 6.2 and 6.10, and to the effect that, to the best of
such officer's knowledge, as of such date no Default has occurred and is
continuing.
43
(g) Reports to SEC and to Shareholders. Promptly upon the filing
or making thereof (i) copies of each filing and report made by the Borrower or
any of its Subsidiaries with or to any securities exchange or the Securities and
Exchange Commission and (ii) if the Borrower has issued stock in a public
offering, of each communication from the Borrower to shareholders generally.
(h) Notice of Litigation, License and ERISA Matters. Promptly
upon learning of the occurrence of any of the following, written notice thereof,
describing the same and the steps being taken by the Borrower with respect
thereto: (i) the institution of, or any adverse determination in, any
litigation, arbitration proceeding or governmental proceeding (including any
Internal Revenue Service or Department of Labor proceeding with respect to any
Plan or Welfare Plan) which could, if adversely determined, be reasonably
expected to have a Material Adverse Effect and which is not Ordinary Course
Litigation, (ii) the occurrence of an ERISA Event; (iii) the commencement of any
dispute which might lead to the modification, transfer, revocation, suspension
or termination of this Agreement or any Loan Document or (iv) any event which
could be reasonably expected to have a Material Adverse Effect or a material
adverse effect on the ability of the Borrower to perform any of its payment or
other material obligations under any of the Loan Documents.
(i) Insurance Reports. Within five (5) Business Days of receipt
of such notice by the Borrower or its Subsidiaries, written notice of any
cancellation or material adverse change in any material Insurance Policy carried
by the Borrower or any of its Subsidiaries.
(j) List of Directors and Officers and Amendments. Concurrently
with the delivery of the financial statements required pursuant to Section
5.1(a)(i) and (ii), a list of the Executive Officers and Directors of the
Borrower and its Subsidiaries to the extent such information is not included in
the information provided pursuant to Section 5.1(g) and to the extent such
information has changed since the last delivery pursuant to this Section.
(k) Formation of Subsidiaries. Promptly upon formation of any
Subsidiary, written notice of the name, purpose and capitalization of such
Subsidiary.
(l) Updated Schedules. From time to time, and in any event
concurrently with delivery of the financial statements under Section 5.1(a)(i)
and (ii), revised Schedules 4.1, 4.5, 4.9, 4.11, 4.13 and 4.14, if applicable,
showing changes from the Schedules previously delivered.
44
(m) Other Information. From time to time such other information
concerning the Borrower or any Subsidiary as the Administrative Agent or any
Lender may reasonably request.
SECTION 5.2 Corporate Existence; Foreign Qualification. Do and cause to
be done at all times all things necessary to (a) maintain and preserve the
corporate existence of the Borrower and each Insurance Subsidiary of the
Borrower (except that inactive Subsidiaries of the Borrower may be merged out of
existence or dissolved), (b) be, and ensure that each Subsidiary of the Borrower
is, duly qualified to do business and be in good standing as a foreign
corporation in each jurisdiction where the nature of its business makes such
qualification necessary unless the failure to be so qualified would not have a
Material Adverse Effect, and (c) do or cause to be done all things necessary to
preserve and keep in full force and effect the Borrower's corporate existence.
SECTION 5.3 Books, Records and Inspections. (a) Maintain, and cause each
of its Subsidiaries to maintain, materially complete and accurate books and
records in accordance with GAAP and in addition, with respect to each Insurance
Subsidiary, SAP, (b) permit, and cause each of its Subsidiaries to permit,
access at reasonable times by the Administrative Agent to its books and records,
(c) permit, and cause each of its Subsidiaries to permit, the Administrative
Agent or its designated representative to inspect at reasonable times its
properties and operations, and (d) permit, and cause each of its Subsidiaries to
permit, the Administrative Agent to discuss its business, operations and
financial condition with its officers and its independent accountants.
SECTION 5.4 Insurance. Maintain, and cause each of its Subsidiaries to
maintain, Insurance Policies to such extent and against such hazards and
liabilities as is required by law or customarily maintained by prudent companies
similarly situated.
SECTION 5.5 Taxes and Liabilities. Pay, and cause each of its
Subsidiaries to pay, when due all material taxes, assessments and other material
liabilities except as contested in good faith and by appropriate proceedings
with respect to which reserves have been established, and are being maintained,
in accordance with GAAP if and so long as such contest could not reasonably be
expected to have a Material Adverse Effect.
SECTION 5.6 Employee Benefit Plans. Maintain, and cause each of its
Subsidiaries to maintain, each Plan and Welfare Plan in compliance in all
material respects with all applicable Requirements of Law.
45
SECTION 5.7 Compliance with Laws. Comply, and cause each of its
Subsidiaries to comply, (a) with all federal and local laws, rules and
regulations related to its businesses (including, without limitation, the
establishment of all insurance reserves required to be established under SAP and
applicable laws restricting the investments of the Borrower), and (b) with all
Contractual Obligations binding upon such entity, except where, in each case,
failure to so comply would not in the aggregate have a Material Adverse Effect.
SECTION 5.8 Maintenance of Permits. Maintain, and cause each of its
Subsidiaries to maintain, all permits, licenses and consents as may be required
for the conduct of its business by any federal or local government agency or
instrumentality except where failure to maintain the same could not reasonably
be expected to have a Material Adverse Effect.
SECTION 5.9 Conduct of Business. Engage, and cause each Subsidiary to
engage, primarily in the same business in which the Borrower and its
Subsidiaries are engaged on the date hereof (including, without limitation,
making no major changes in its business lines, geographic exposures or retention
levels); provided, however, Nobel may cede its casualty business to American
Re-Insurance Company and/or Inter-Ocean Reinsurance Company Ltd.
ARTICLE VI
NEGATIVE COVENANTS
Until the Loans and all other Obligations are paid in full and until the
Revolving Commitment Termination Date, the Borrower agrees that, unless at any
time the Required Lenders shall otherwise expressly consent in writing, it will:
SECTION 6.1 Debt Service Coverage Ratio. Not permit the Debt Service
Coverage Ratio to be less than 1.25:1.00 as of the end of any Fiscal Quarter.
SECTION 6.2 Risk Based Capital. Not permit the adjusted surplus (as
defined by the applicable Department's Risk Based Capital Guidelines) of each
Insurance Subsidiary to be less than 125% of such Insurance Subsidiary's
respective Company Action Level (as defined by the applicable Department's Risk
Based Capital Guidelines) as of the end of each Fiscal Year.
SECTION 6.3 Mergers, Consolidations and Sales. Not, and not permit any
of its Insurance Subsidiaries to, (a) merge or consolidate, or purchase or
otherwise acquire all or substantially all of the assets or stock of any class
of, or any
46
partnership or joint venture interest in, any other Person (other than a newly
formed Subsidiary or the acquisition of a Subsidiary which complies with clause
(ii) of this Section 6.3), or (b) sell, transfer, convey or lease all or any
substantial part of its assets or sell or assign with or without recourse any
receivables, other than any sale, transfer, conveyance or lease in the ordinary
course of business except for (i) any such merger or consolidation, sale,
transfer, conveyance, lease or assignment of any wholly owned Subsidiary into,
with or to the Borrower or any other wholly owned Subsidiary, (ii) purchases or
acquisitions which comply with Section 5.9 provided no Default or Event of
Default has occurred and is continuing or would result therefrom and (iii) the
Purchase.
SECTION 6.4 Regulations U and X. Not, and not permit any of its
Subsidiaries to, hold margin stock (as such term is defined in Regulation U of
the FRB) having a value in excess of 20% of the value of the assets of the
Borrower and its Subsidiaries taken as a whole after taking into account the
application of the proceeds of the Loans.
SECTION 6.5 Other Agreements. Not, and not permit any of its
Subsidiaries to, enter into any agreement containing any provision which would
be violated or breached by the performance of obligations hereunder or under any
instrument or document delivered or to be delivered by it hereunder or in
connection herewith.
SECTION 6.6 Transactions with Affiliates. Not, and not permit any
Subsidiary to, enter into, or cause, suffer or permit to exist, directly or
indirectly, any arrangement, transaction or contract with any of its Affiliates
unless such arrangement, transaction or contract is on an arm's length basis;
provided that transactions between the Borrower and the Guarantor or any
wholly-owned Subsidiary of the Guarantor or between any wholly-owned
Subsidiaries of the Borrower shall be excluded from the restrictions set forth
in this Section 6.6.
SECTION 6.7 Liens. Not, and not permit any of its Subsidiaries to,
create or permit to exist any Lien with respect to any assets now or hereafter
existing or acquired, except the following: (i) Liens for current taxes not
delinquent or for taxes being contested in good faith and by appropriate
proceedings and with respect to which adequate reserves have been established,
and are being maintained, in accordance with GAAP; (ii) easements, party wall
agreements, rights of way, restrictions, minor defects or irregularities in
title and other similar Liens not interfering in any material respect with the
ordinary conduct of the business of the Borrower and its Subsidiaries taken as a
whole; (iii) Liens in connection with the acquisition of fixed assets after the
date hereof and attaching
47
only to the property being acquired; (iv) Liens incurred in the ordinary course
of business in connection with workers' compensation, unemployment insurance or
other forms of governmental insurance or benefits and Liens pursuant to letters
of credit or other security arrangements in connection with such insurance or
benefits; (v) attachments, judgments and other similar Liens for sums not
exceeding $5,000,000 (excluding any portion thereof which is covered by
insurance so long as the insurer is reasonably likely to be able to pay and has
accepted a tender of defense and indemnification without reservation of rights);
(vi) attachments, judgments and other similar Liens for sums of $5,000,000 or
more (excluding any portion thereof which is covered by insurance so long as the
insurer is reasonably likely to be able to pay and has accepted a tender of
defense and indemnification without reservation of rights) provided the
execution or other enforcement of such Liens is effectively stayed and claims
secured thereby are being actively contested in good faith and by appropriate
proceedings and have been bonded off; (vii) Liens identified on Schedule 6.7 and
extensions, renewals or replacements thereof but only if the principal amount of
the Debt secured thereby immediately prior to such extension, renewal or
replacement is not increased and such Lien is not extended to any other
property; (viii) mechanics', workers', materialmen's, landlord liens and other
like Liens arising in the ordinary course of business in respect of obligations
which are not delinquent or which are being contested in good faith and by
appropriate proceedings and with respect to which adequate reserves have been
established, and are being maintained, in accordance with GAAP, and (ix) liens
pursuant to trust, letter of credit or other security arrangements in connection
with Primary Policies, Borrower Reinsurance Agreements or Catastrophe Bonds;
provided, however, that, no Lien shall be permitted to exist on the shares of
stock of any Subsidiary.
SECTION 6.8 Restrictions On Negative Pledge Agreements. Not, and not
permit any of its Subsidiaries to, create, incur, assume or suffer to exist any
agreement, other than this Agreement which places any restrictions upon the
right of the Borrower or any of its Subsidiaries to sell, pledge or otherwise
dispose of any material portion of its properties now owned or hereafter
acquired other than as permitted under Section 6.7, except for such restrictions
imposed by federal or state laws upon the right of the Borrower or any of its
Subsidiaries to sell, pledge or otherwise dispose of securities owned by it.
SECTION 6.9 No Amendment of Certain Documents. Not enter into or permit
to exist any amendment, modification or waiver of the Purchase Agreement as in
effect on the Effective Date which would in any manner be materially adverse to
the interests of the Lenders.
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SECTION 6.10 Dividends, Etc.. Not, and not permit its Subsidiaries to,
(a) declare or pay any dividends on any of its capital stock (other than
payments of dividends by a Subsidiary to the Borrower), (b) purchase or redeem
any capital stock of the Guarantor or any of its Subsidiaries other than the
Borrower or any of its Subsidiaries or any warrants, options or other rights in
respect of such stock, or (c) set aside funds for any of the foregoing, except
that the Borrower may declare or pay dividends on any of its Capital Stock
provided no Default or Event of Default has occurred and is continuing on the
date of or would result from such declaration or payment.
ARTICLE VII
EVENTS OF DEFAULT AND THEIR EFFECT
SECTION 7.1 Events of Default. Each of the following shall constitute an
Event of Default under this Agreement:
(a) Non-Payment of Loan. Default in the payment when due of any
principal on the Loans.
(b) Non-Payment of Interest, Fees, etc. Default, and continuance
thereof for three (3) Business Days, in the payment when due of interest on the
Loans, fees or of any other amount payable hereunder or under the Loan
Documents.
(c) Non-Payment of Other Debt. (i) Default in the payment when
due (subject to any applicable grace period), whether by acceleration or
otherwise, of any other Debt of, or guaranteed by, the Borrower or any of its
Subsidiaries if the aggregate amount of Debt of the Borrower and/or any of its
Subsidiaries which is accelerated or due and payable, or which (subject to any
applicable grace period) may be accelerated or otherwise become due and payable,
by reason of such default or defaults is $5,000,000 or more, or (ii) default in
the performance or observance of any obligation or condition with respect to any
such other Debt of, or guaranteed by, the Borrower and/or any of its
Subsidiaries if the effect of such default or defaults is to accelerate the
maturity (subject to any applicable grace period) of any such Debt of $5,000,000
or more in the aggregate or to permit the holder or holders of such Debt of
$5,000,000 or more in the aggregate, or any trustee or agent for such holders,
to cause such Debt to become due and payable prior to its expressed maturity.
(d) Other Material Obligations. Except for obligations covered
under other provisions of this Article VII, default in the payment when due, or
in the performance or observance of, any material obligation of, or material
condition
49
agreed to by, the Borrower or any of its Subsidiaries with respect to any
material purchase or lease obligation of $5,000,000 or more (unless the
existence of any such default is being contested by the Borrower in good faith
and by appropriate proceedings and the Borrower has established, and is
maintaining, adequate reserves therefor in accordance with GAAP) which default
continues for a period of 30 days.
(e) Bankruptcy, Insolvency, etc. (i) The Guarantor, the Borrower
or any Insurance Subsidiary becomes insolvent or generally fails to pay, or
admits in writing its inability to pay, debts as they become due; (ii) there
shall be commenced by or against the Guarantor, the Borrower or any Insurance
Subsidiary any case, proceeding or other action (A) under any existing or future
law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, supervision, conservatorship, liquidation, reorganization or relief
of debtors, seeking to have an order for relief entered with respect to it, or
seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization,
rehabilitation, conservation, supervision, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or its
debts, obligations or liabilities, or (B) seeking appointment of a receiver,
trustee, custodian, rehabilitator, conservator, supervisor, liquidator or other
similar official for it or for all or any substantial part of its assets, in
each case which (1) results in the entry of an order for relief or any such
adjudication or appointment or (2) if filed against such Person, remains
undismissed, undischarged or unstayed for a period of 60 days; or (iii) there
shall be commenced against any of such Person any case, proceeding or other
action seeking issuance of a warrant of attachment, execution, distraint or
similar process against all or any substantial part of its assets which results
in the entry of an order for any such relief which shall not have been vacated,
discharged, or stayed or bonded pending appeal within 60 days from the entry
thereof; or (iv) any of such Persons shall take any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the acts set
forth in clause(ii) or (iii) above; or (v) any Governmental Authority shall
issue any order of conservation, supervision or any other order of like effect
relating to any of such Persons.
(f) Non-compliance With Section 6.1. The Borrower shall fail to
comply with the covenant set forth in Section 6.1 unless the Borrower thereafter
complies with such covenant on or before the last day of the Fiscal Quarter
following the Fiscal Quarter in which such noncompliance occurred.
(g) Non-compliance With Other Financial Conditions. Failure by
the Borrower to comply with its covenants set forth in Section 6.2, 6.8, 6.9, or
6.10.
50
(h) Non-compliance With Other Provisions. Failure by the Borrower
to comply with or to perform any provision of this Agreement or the other Loan
Documents (and not constituting an Event of Default under any of the other
provisions of this Article VII) and continuance of such failure for 30 days
after notice thereof from the Administrative Agent to the Borrower.
(i) Guarantor Default. Failure by the Guarantor (or any of its
Insurance Subsidiaries) to comply or perform any covenants or agreements of
Guarantor or any its Insurance Subsidiaries set forth in the Guaranty or the
other Loan Documents applicable to the Guarantor or any of the Insurance
Subsidiaries (other than those constituting an Event of Default under any of the
other provisions of this Article VII).
(j) Warranties and Representations. Any warranty or
representation made by or on behalf of the Guarantor, the Borrower or any
Subsidiary in any of the Loan Documents is inaccurate or incorrect or is
breached or false or misleading in any material respect as of the date such
warranty or representation is made; or any schedule, certificate, financial
statement, report, notice, or other instrument furnished by or on behalf of the
Guarantor, the Borrower or any Subsidiary to the Administrative Agent or the
Lenders is false or misleading in any material respect on the date as of which
the facts therein set forth are stated or certified.
(k) Employee Benefit Plans. A contribution failure occurs with
respect to any Plan sufficient to give rise to a Lien against the Borrower or
any of its Subsidiaries under section 302(f)(1) of ERISA (as in effect on the
Effective Date); or withdrawal by one or more companies in the Controlled Group
from one or more Multiemployer Plans to which it or they have an obligation to
contribute and the withdrawal liability (without unaccrued interest) to
Multiemployer Plans as a result of such withdrawal or withdrawals (including any
outstanding withdrawal liability that the Controlled Group has incurred on the
date of such withdrawal) is $5,000,000 or more.
(l) Loan Documents. Any action shall be taken by or on behalf of
the Borrower, the Guarantor or any Affiliate thereof to discontinue any of the
Loan Documents or to contest the validity, binding nature or enforceability of
any thereof.
(m) Change in Control. A Change in Control occurs.
(n) Judgments. A final judgment or judgments which exceed an
aggregate of $5,000,000 (excluding any portion thereof which is covered by
insurance so long as the insurer is reasonably likely to be able to pay and has
accepted a tender of defense and indemnification without reservation of rights)
shall
51
be rendered against the Borrower or any Subsidiary and shall not have been
discharged or vacated or had execution thereof stayed pending appeal within 60
days after entry or filing of such judgment(s).
(o) Change in Law. Any change is made in the Insurance Code which
affects the dividend practices of any Insurance Subsidiary and which is
reasonably likely to have a Material Adverse Effect and such circumstances shall
continue for 120 days.
(p) Defaults Under Revolving Credit Agreement. An event of
default shall have occurred and be continuing under the Revolving Credit
Agreement. If the Revolving Credit Agreement is terminated, the occurrence of
any event or the existence of any circumstance which would have, had it occurred
or existed prior to such termination, constituted an event of default, shall
constitute an Event of Default hereunder.
SECTION 7.2 Effect of Event of Default. If any Event of Default
described in Section 7.1(e) shall occur, the Loans and all other Obligations
shall become immediately due and payable, all without notice of any kind; and,
in the case of any other Event of Default, the Administrative Agent upon the
written request of the Required Lenders shall terminate the Commitments
hereunder and declare all or any portion of the Loans and all other Obligations
to be due and payable, whereupon the Commitments shall terminate and all or such
portion of the Loans and all other Obligations shall become immediately due and
payable, all without further notice of any kind. The Administrative Agent shall
promptly advise the Borrower of any such declaration but failure to do so shall
not impair the effect of such declaration. Notwithstanding the foregoing, the
effect as an Event of Default of any event described in Section 7.1(a) may not
be waived except by consent of all of the Lenders and acknowledged by the
Administrative Agent in writing.
ARTICLE VIII
CONDITIONS
SECTION 8.1 Conditions to Occurrence of the Effective Date. The
occurrence of the Effective Date shall be subject to receipt by the
Administrative Agent of all of the following, each duly executed and dated the
Effective Date (or such earlier date as shall be satisfactory to the
Administrative Agent), each in form and substance satisfactory to the
Administrative Agent:
(a) This Agreement and Certain Related Documents. This Agreement,
the Guaranty and such other Loan Documents as are required to be delivered by
the terms of this Agreement.
52
(b) Resolutions. Certified copies of resolutions of the Board of
Directors of each of the Borrower and the Guarantor authorizing the execution,
delivery and performance, respectively, of those documents and matters required
of it with respect to the Loan Documents to which such Person is a party.
(c) Incumbency and Signatures. A certificate of an Authorized
Officer of each of the Borrower and the Guarantor certifying the names of the
individual or individuals authorized to sign the Loan Documents to which such
Person is a party, together with a sample of the true signature of each such
individual. (The Lenders may conclusively rely on each such certificate until
formally advised by a like certificate of any changes therein.)
(d) Opinions of Counsel. A favorable opinion of U.S. counsel to
the Borrower and the Guarantor substantially in the form of Exhibit D-1, and
addressing such legal matters as the Administrative Agent may require and a
favorable opinion of Bermuda counsel to the Guarantor, substantially in the form
of Exhibit D-2, and addressing such other legal matters as the Administrative
Agent may require.
(e) Organization Documents, etc. A Certificate of an Authorized
Officer of the Borrower certifying true and correct copies of the Purchase
Agreement and the Organization Documents of the Borrower.
(f) Insurance Proceedings. Certificate of an Authorized Officer
of the Borrower and the Guarantor that there are no material insurance
regulatory proceedings pending or threatened against the Borrower or any
Insurance Subsidiary (including Nobel) in any jurisdiction.
(g) Fees. The fees referred to in Section 2.8 which are due and
payable on or prior to the Effective Date shall have been paid to the
Administrative Agent where applicable for the benefit of the Lenders.
(h) Other. Such other documents as the Administrative Agent may
reasonably request.
SECTION 8.2 Conditions to Occurrence of the Funding Date. The occurrence
of the Funding Date and the initial Borrowing hereunder shall be subject to
receipt by the Administrative Agent of all of the following, each duly executed
and dated the Funding Date (or such earlier date as shall be satisfactory to the
Administrative Agent), each in form and substance satisfactory to the
Administrative Agent:
53
(a) Insurance Proceedings. Certificate of an Authorized Officer
of the Borrower and the Guarantor that there are no material insurance
regulatory proceedings pending or, to its knowledge, threatened against the
Borrower or any Insurance Subsidiary (including Nobel) in any jurisdiction.
(b) Material Adverse Change Certificate. An officer's
certificate, signed by an Authorized Officer of the Borrower and the Guarantor,
certifying that to such officer's best knowledge, since December 31, 1997, no
event has occurred which individually or in the aggregate (i) could reasonably
be expected to have a Material Adverse Effect or (ii) could reasonably be
expected to have a materially adverse effect on the assets, business, financial
conditions, operations or prospects of Nobel or the other entities being
acquired by the Borrower in the Purchase.
(c) Effective Date. The Effective Date shall have occurred.
(d) Capital Structure. The Administrative Agent and its counsel
shall be satisfied with the existing and proposed capital structure and
corporate structure of the Borrower.
(e) Purchase. There shall not exist any litigation or claims with
respect to any aspect of the Purchase, any related transaction or any other
transaction contemplated by the Purchase Agreement or the financing thereof
which the Administrative Agent reasonably considers to be material.
(f) The Funding and Close. The Administrative Agent shall have
received evidence, reasonably satisfactory to the Administrative Agent, that the
Purchase will be closed within 72 hours of the Funding Date on terms and
conditions reasonably satisfactory to the Lenders and that sufficient cash is
available to the Borrower to consummate the Purchase taking into account the
Term Loans hereunder.
(g) Officer's Certificate. A certificate (which shall be given on
the date the Purchase is closed) executed by an Authorized Officer of the
Borrower certifying that:
(i) the Purchase has been consummated in accordance
with the terms of the Purchase Agreement;
(ii) the Purchase complied in all respects with all applicable
legal requirements, and all necessary governmental, regulatory,
shareholder and other consents and approvals required for the
consummation of the Purchase were duly obtained, were and continue to be
in full force and effect;
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(iii) the Purchase and the consummation thereof do not violate
any statute or regulations or any order, judgment, or decree of any
Governmental Authority and will not result in a breach, or constitute a
default under, any agreement, indenture, order or decree affecting the
Guarantor, the Borrower or any of its Subsidiaries;
(iv) all of the representations and warranties of the Borrower,
and to the best of the Borrower's knowledge, the other parties to the
Purchase Agreement, contained in the Purchase Agreement and the other
documents executed in connection therewith are true and correct in all
material respects as of the Funding Date of the Purchase; and
(v) that Nobel has entered into agreements with American
Re-Insurance Company and/or Inter-Ocean Reinsurance Company Ltd.
providing for the reinsurance by such Persons of the casualty business
of Nobel.
(h) Other. Such other documents as the Administrative Agent may
reasonably request.
SECTION 8.3 Conditions to All Borrowings. The obligation of the Lenders
to make all Loans (including the initial Loans) shall be subject to the prior or
concurrent satisfaction (in form and substance satisfactory to the
Administrative Agent) of each of the conditions precedent set forth below:
(a) No Default. No Default (excluding a Default under Section
7.1(f) but including an Event of Default under Section 7.1(f)) shall have
occurred and be continuing or will result from the making of the Loans and no
Default or Event of Default shall have occurred and be continuing under the Loan
Documents or will result from the making of the Loans and no Default (as defined
under the Revolving Credit Agreement) has occurred and is continuing.
(b) Warranties and Representations. (i) All warranties and
representations contained in this Agreement (other than Section 4.4 except in
the case of the initial Loans) and the representations and warranties of the
Guarantor contained in Article III of the Guaranty shall be true and correct in
all material respects as of the date of any Loan, with the same effect as though
made on the date of and concurrently with the making of such Loan (except where
such representation speaks as of specified date) and (ii) all covenants
contained herein and in such documents to be performed by each of the parties
thereto (other than the Administrative Agent or the Lenders) prior to the date
of any Loan shall have been performed.
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(c) Litigation. (i) No litigation (including, without limitation,
derivative actions), arbitration, governmental investigation or proceeding or
inquiry shall be, on the date of any Loan, pending, or to the knowledge of the
Borrower, threatened which seeks to enjoin or otherwise prevent the consummation
of, or to recover any damages or to obtain material relief as a result of, the
transactions contemplated hereunder or, in the reasonable opinion of the
Required Lenders, could be reasonably expected to be materially adverse to any
of the parties to this Agreement and which is not Ordinary Course Litigation,
and (ii) in the reasonable opinion of the Required Lenders, no material adverse
development shall have occurred in any litigation (including, without
limitation, derivative actions), arbitration, government investigation or
proceeding or inquiry disclosed in Schedule 4.4 which is likely to have a
Material Adverse Effect.
(d) Fees. The fees referred to in Section 2.8 which are due and
payable on or prior to the Funding Date or the date of any Loan shall have been
paid to the Administrative Agent, where applicable, for the benefit of the
Lenders.
(e) Borrowing Request. The Administrative Agent shall have
received a Notice of Borrowing.
(f) Material Adverse Effect. There shall not have occurred any
event which, in the reasonable judgment of the Required Lenders, constitutes a
Material Adverse Effect.
ARTICLE IX
THE ADMINISTRATIVE AGENT
SECTION 9.1 Appointment and Authorization. Each Lender hereby
irrevocably (subject to Section 9.9) appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the Administrative Agent have or be deemed
to have any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Administrative Agent.
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SECTION 9.2 Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Administrative
Agent shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
SECTION 9.3 Liability of Administrative Agent. None of the Agent-Related
Persons shall (a) be liable for any action taken or omitted to be taken by any
of them under or in connection with this Agreement or any other Loan Document or
the transactions contemplated hereby (except for its own gross negligence or
willful misconduct), or (b) be responsible in any manner to any of the Lenders
for any recital, statement, representation or warranty made by the Guarantor,
the Borrower or any Subsidiary or Affiliate of the Borrower, or any officer
thereof, contained in this Agreement or in any other Loan Document, or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of the Guarantor, the Borrower or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or to
inspect the properties, books or records of the Guarantor, the Borrower or any
of the Borrower's Subsidiaries or Affiliates.
SECTION 9.4 Reliance by Administrative Agent. (a) The Administrative
Agent shall be entitled to rely, and shall be fully protected in relying, upon
any writing, resolution, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, statement or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons, and upon advice and statements of
legal counsel (including counsel to the Borrower), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless it shall first receive such advice
or concurrence of the Required Lenders as it deems appropriate and, if it so
requests, it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement or any
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other Loan Document in accordance with a request or consent of the Required
Lenders and such request and any action taken or failure to act pursuant thereto
shall be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 8.1, each Lender that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Administrative Agent to such Lender
for consent, approval, acceptance or satisfaction, or required thereunder to be
consented to or approved by or acceptable or satisfactory to the Lender.
SECTION 9.5 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal, interest
and fees required to be paid to the Administrative Agent for the account of the
Lenders, unless the Administrative Agent shall have received written notice from
a Lender or the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default". The
Administrative Agent will notify the Lenders of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as may be requested by the Required Lenders in accordance with
Article VII; provided, however, that unless and until the Administrative Agent
has received any such request, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable or in the best
interest of the Lenders.
SECTION 9.6 Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Administrative Agent hereinafter taken, including any review of the
affairs of the Borrower and its Subsidiaries, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Lender. Each
Lender represents to the Administrative Agent that it has, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Guarantor, the Borrower and its
Subsidiaries, and all applicable bank regulatory laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Borrower hereunder. Each Lender also
represents that it will, independently and without reliance upon any Agent-
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Related Person and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action under this Agreement and the other
Loan Documents, and to make such investigations as it deems necessary to inform
itself as to the business, prospects, operations, property, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly herein required to be furnished to the Lenders by the
Administrative Agent, the Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Guarantor or the Borrower which may come
into the possession of any of the Agent-Related Persons.
SECTION 9.7 Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Borrower and without limiting the obligation of the Borrower to do so), pro
rata, from and against any and all Indemnified Liabilities; provided, however,
that no Lender shall be liable for the payment to the Agent-Related Persons of
any portion of such Indemnified Liabilities resulting solely from such Person's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Lender shall reimburse the Administrative Agent upon demand for its ratable
share of any costs or out-of-pocket expenses (including Attorney Costs) incurred
by the Administrative Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that the Administrative Agent is not reimbursed for such expenses by or on
behalf of the Borrower. The undertaking in this Section shall survive the
payment of all Obligations hereunder and the resignation or replacement of the
Administrative Agent.
SECTION 9.8 Administrative Agent in Individual Capacity. BofA and its
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with the
Guarantor, the Borrower and its Subsidiaries and Affiliates as though BofA were
not the Administrative Agent hereunder and without notice to or consent of the
Lenders. The Lenders acknowledge that, pursuant to such activities, BofA or its
Affiliates may receive information regarding the Guarantor, the Borrower or its
Affiliates (including information that may be
59
subject to confidentiality obligations in favor of the Guarantor, the Borrower
or such Subsidiary) and acknowledge that the Administrative Agent shall be under
no obligation to provide such information to them. With respect to its Loans,
BofA shall have the same rights and powers under this Agreement as any other
Lender and may exercise the same as though it were not the Administrative Agent,
and the terms "Lender" and "Lenders" include BofA in its individual capacity.
SECTION 9.9 Successor Administrative Agent. The Administrative Agent
may, and at the request of the Required Lenders shall, resign as Administrative
Agent upon 30 days' notice to the Lenders. If the Administrative Agent resigns
under this Agreement, the Required Lenders shall appoint from among the Lenders
a successor agent for the Lenders which successor agent shall be approved by the
Borrower. If no successor agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Lenders and the Borrower, a successor agent from among
the Lenders. Upon the acceptance of its appointment as successor agent
hereunder, such successor agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term "Administrative Agent"
shall mean such successor agent and the retiring Administrative Agent's
appointment, powers and duties as Administrative Agent shall be terminated.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article IX and Sections 10.4 and
10.5 shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Administrative Agent under this Agreement. If no successor
agent has accepted appointment as Administrative Agent by the date which is 30
days following a retiring Administrative Agent's notice of resignation, the
retiring Administrative Agent's resignation shall nevertheless thereupon become
effective and the Lenders shall perform all of the duties of the Administrative
Agent hereunder until such time, if any, as the Required Lenders appoint a
successor agent as provided for above.
SECTION 9.10 Withholding Tax. (a) Each Lender which is not organized
under the laws of the United States or a state thereof hereby agrees, to the
extent permitted by applicable law (including any applicable double taxation
treaty), to execute and deliver to the Borrower and the Administrative Agent on
or before the first scheduled payment date (or, if later, the date it becomes a
party to this Agreement), a properly completed IRS Form 1001 or Form 4224, as
appropriate, or, such other form or forms as may be required under the Code or
other laws of the United States as a condition to exemption from United States
withholding tax. Such Lender agrees to promptly notify the Administrative Agent
and the Borrower of any change in circumstances or
60
Requirement of Law which would modify or render invalid any claimed exemption.
(b) Each Lender hereby represents and warrants to the Borrower
that on the Effective Date (or, if later, the date it becomes a party to this
Agreement) it is entitled to receive payments of principal of, and interest on,
Loans made by such Lender without withholding or deduction of U.S. withholding
tax.
(c) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Borrower and/or the
Administrative Agent did not properly withhold tax from amounts paid to or for
the account of any Lender (because the appropriate form was not delivered, was
not properly executed, or because such Lender failed to notify the Borrower
and/or the Administrative Agent of a change in circumstances which rendered the
exemption from withholding tax ineffective, or for any other reason) such Lender
shall indemnify the Borrower and/or the Administrative Agent fully for all
amounts paid, directly or indirectly, by the Borrower and/or the Administrative
Agent as tax or otherwise, including penalties and interest, and including any
taxes imposed by any jurisdiction on the amounts payable to the Borrower and/or
the Administrative Agent under this Section, together with all costs and
expenses (including Attorney Costs). The obligation of the Lenders under this
subsection shall survive the payment of all Obligations and the resignation or
replacement of the Administrative Agent.
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Amendments and Waivers. No amendment or waiver of any
provision of this Agreement or any other Loan Document, and no consent with
respect to any departure by the Borrower therefrom, shall be effective unless
the same shall be in writing and signed by the Required Lenders (or by the
Administrative Agent at the written request of the Required Lenders) and the
Borrower and acknowledged by the Administrative Agent, and then any such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such waiver, amendment, or
consent shall, unless in writing and signed by all the Lenders and the Borrower
and acknowledged by the Administrative Agent, do any of the following:
(a) increase or extend any Commitment of any Lender (or reinstate
any Commitment terminated pursuant to Section 7.2);
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(b) postpone or delay any date fixed by this Agreement or any
other Loan Document for any payment of principal, interest, fees or other
amounts due to the Lenders (or any of them) hereunder or under any other Loan
Document;
(c) reduce or forgive the principal of, or the rate of interest
specified herein on any Loan, or any fees or other amounts payable hereunder or
under any other Loan Document;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Lenders or any of
them to take any action hereunder;
(e) release the Guarantor from its obligations under the
Guaranty; or
(f) amend this Section 10.1, or Section 2.12, or any provision
herein providing for consent or other action by all Lenders;
and, provided further, that no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Required
Lenders or all the Lenders, as the case may be, affect the rights or duties of
the Administrative Agent under this Agreement or any other Loan Document.
SECTION 10.2 Notices. (a) All notices, requests and other communications
shall be in writing (including, unless the context expressly otherwise provides,
by facsimile transmission, provided that any matter transmitted by the Borrower
by facsimile (i) shall be immediately confirmed by a telephone call to the
recipient at the number specified on Schedule 10.2, and (ii) except in the case
of Notices of Borrowing and Notices of Conversions/Continuation, shall be
followed promptly by delivery of a hard copy original thereof) and mailed, faxed
or delivered, to the address or facsimile number specified for notices on
Schedule 10.2; or, as directed to the Borrower or the Administrative Agent, to
such other address as shall be designated by such party in a written notice to
the other parties, and as directed to any other party, at such other address as
shall be designated by such party in a written notice to the Borrower and the
Administrative Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or, if delivered, upon delivery, except that notices
pursuant to Article II or IX shall not be effective until actually received by
the Administrative Agent.
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(c) Any agreement of the Administrative Agent and the Lenders
herein to receive certain notices by telephone or facsimile is solely for the
convenience and at the request of the Borrower. The Administrative Agent and the
Lenders shall be entitled to rely on the authority of any Person purporting to
be a Person authorized by the Borrower to give such notice and the
Administrative Agent and the Lenders shall not have any liability to the
Borrower or other Person on account of any action taken or not taken by the
Administrative Agent or the Lenders in reliance upon such telephonic or
facsimile notice. The obligation of the Borrower to repay the Loans shall not be
affected in any way or to any extent by any failure by the Administrative Agent
and the Lenders to receive written confirmation of any telephonic or facsimile
notice or the receipt by the Administrative Agent and the Lenders of a
confirmation which is at variance with the terms understood by the
Administrative Agent and the Lenders to be contained in the telephonic or
facsimile notice.
SECTION 10.3 No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Administrative Agent or any Lender,
any right, remedy, power or privilege hereunder, shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege.
SECTION 10.4 Costs and Expenses. The Borrower shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse BofA (including in its capacity as Administrative
Agent) within ten Business Days after demand for all costs and expenses incurred
by BofA (including in its capacity as Administrative Agent) in connection with
the development, preparation, delivery, administration and execution of, and any
amendment, supplement, waiver or modification to (in each case, whether or not
consummated), this Agreement, any Loan Document and any other documents prepared
in connection herewith or therewith, and the consummation of the transactions
contemplated hereby and thereby, including reasonable Attorney Costs incurred by
BofA (including in its capacity as Administrative Agent) with respect thereto;
and
(b) pay or reimburse the Administrative Agent and each Lender
within ten Business Days after demand for all costs and expenses (including
Attorney Costs) incurred by them in connection with the enforcement, attempted
enforcement, or preservation of any rights or remedies under this Agreement or
any other Loan Document during the existence of an Event of Default or after
acceleration of the Loans (including in connection with any "workout" or
restructuring regarding the
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Loans, and including any bankruptcy or other insolvency proceeding or appellate
proceeding).
SECTION 10.5 Indemnity. Whether or not the transactions contemplated
hereby are consummated, the Borrower shall indemnify and hold the Agent-Related
Persons, and each Lender and each of its respective officers, directors,
employees, counsel, agents and attorneys-in-fact (each, an "Indemnified Person")
harmless from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, charges, expenses and disbursements
(including Attorney Costs) of any kind or nature whatsoever which may at any
time (including at any time following repayment of the Loans and the
termination, resignation or replacement of the Administrative Agent or
replacement of any Lender) be imposed on, incurred by or asserted against any
such Person in any way relating to or arising out of this Agreement or any
document contemplated by or referred to herein, or the transactions contemplated
hereby, or any action taken or omitted by any such Person under or in connection
with any of the foregoing, including with respect to any investigation,
litigation or proceeding (including any bankruptcy or other insolvency
proceeding or appellate proceeding) related to or arising out of this Agreement
or the Loans or the use of the proceeds thereof, whether or not any Indemnified
Person is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"); provided, that the Borrower shall have no obligation hereunder to
any Indemnified Person with respect to Indemnified Liabilities resulting solely
from the gross negligence or willful misconduct of such Indemnified Person. The
agreements in this Section shall survive payment of all other Obligations.
SECTION 10.6 Payments Set Aside. To the extent that the Borrower makes a
payment to the Administrative Agent or the Lenders, or the Administrative Agent
or the Lenders exercise their right of set-off, and such payment or the proceeds
of such set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any bankruptcy or other insolvency proceeding or otherwise, then
(a) to the extent of such recovery the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to the Administrative Agent upon demand its
pro rata share of any amount so recovered from or repaid by the Administrative
Agent.
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SECTION 10.7 Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, except that the Borrower may not
assign or transfer any of its rights or obligations under this Agreement without
the prior written consent of the Administrative Agent and each Lender.
SECTION 10.8 Assignments, Participations, etc. (a) Any Lender may, with
the written consent of the Borrower (at all times other than during the
existence of an Event of Default) and the Administrative Agent, which consents
shall not be unreasonably withheld, at any time assign and delegate to one or
more Eligible Assignees (provided that no written consent of the Borrower or the
Administrative Agent shall be required in connection with any assignment and
delegation by a Lender to an Eligible Assignee that is an Affiliate of such
Lender) (each an "Assignee") all, or any ratable part of all, of the Loans, the
Commitments and the other rights and obligations of such Lender hereunder,
provided, however, that (x) any assignment and delegation shall be a constant
and not a varying, percentage of all of the assigning Lender's Commitments and
Loans hereunder, (y) the aggregate principal amount of the Commitments and Loans
assigned by any Lender to someone other than another Lender shall be in a
minimum amount of $5,000,000 (or if less, the entire Commitments then held by
such Lender) and after giving effect to any such assignment by a Lender, the
aggregate amount of the Commitments and/or Loans held by such assigning Lender
is at least $5,000,000 (unless such Lender has assigned the entire Commitment
and Loans then held by it). The Borrower and the Administrative Agent may
continue to deal solely and directly with such Lender in connection with the
interest so assigned to an Assignee until (i) written notice of such assignment,
together with payment instructions, addresses and related information with
respect to the Assignee, shall have been given to the Borrower and the
Administrative Agent by such Lender and the Assignee; (ii) such Lender and its
Assignee shall have delivered to the Borrower and the Administrative Agent an
Assignment and Acceptance in the form of Exhibit E ("Assignment and Acceptance")
and (iii) the assignor Lender or Assignee has paid to the Administrative Agent a
processing fee in the amount of $3,000.
(b) From and after the date that the Administrative Agent
notifies the assignor Lender that it has received (and provided the required
consents with respect to) an executed Assignment and Acceptance and payment of
the above-referenced processing fee, (i) the Assignee thereunder shall be a
party hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, shall have the rights
and obligations of a Lender under the Loan Documents, and (ii) the assignor
Lender shall, to
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the extent that rights and obligations hereunder and under the other Loan
Documents have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Loan
Documents.
(c) Immediately upon each Assignee's making its processing fee
payment under the Assignment and Acceptance, this Agreement shall be deemed to
be amended to the extent, but only to the extent, necessary to reflect the
addition of the Assignee and the resulting adjustment of the Commitments arising
therefrom. The Commitment allocated to each Assignee shall reduce such
Commitments of the assigning Lender pro tanto.
(d) Any Lender may at any time sell to one or more commercial
banks or other Persons not Affiliates of the Borrower (a "Participant")
participating interests in any Loans, the Commitment of that Lender and the
other interests of that Lender (the "Originating Lender") hereunder and under
the other Loan Documents provided that such assignment shall be a constant and
not a varying percentage of that Lender's Commitments and Loans; provided,
however, that (i) the originating Lender's obligations under this Agreement
shall remain unchanged, (ii) the Originating Lender shall remain solely
responsible for the performance of such obligations, (iii) the Borrower and the
Administrative Agent shall continue to deal solely and directly with the
Originating Lender in connection with the originating Lender's rights and
obligations under this Agreement and the other Loan Documents, and (iv) no
Lender shall transfer or grant any participating interest under which the
Participant has rights to approve any amendment to, or any consent or waiver
with respect to, this Agreement or any other Loan Document, except to the extent
such amendment, consent or waiver would require unanimous consent of the Lenders
as described in the first proviso to Section 10.1. In the case of any such
participation, the Participant shall be entitled to the benefit of Sections 3.1,
3.3 and 10.5 to the extent the Lender selling such participation would be so
entitled, and if amounts outstanding under this Agreement are due and unpaid, or
shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall be deemed to have the
right of set-off in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under this Agreement.
(e) Notwithstanding any other provision in this Agreement, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement and any Note held by
it in favor of any Federal Reserve Bank in accordance with Regulation A of the
FRB or U.S. Treasury Regulation 31 CFR ss.203.14, and such Federal
66
Reserve Bank may enforce such pledge or security interest in any manner
permitted under applicable law.
SECTION 10.9 Confidentiality. Each Lender agrees to take and to cause
its Affiliates to take normal and reasonable precautions and exercise due care
to maintain the confidentiality of all information identified as "confidential"
or "secret" by the Borrower and provided to it by the Guarantor, the Borrower or
any Subsidiary, or by the Administrative Agent on behalf of the Guarantor, the
Borrower or any Subsidiary of either of them, under this Agreement or any other
Loan Document, and neither it nor any of its Affiliates shall use any such
information other than in connection with or in enforcement of this Agreement
and the other Loan Documents or in connection with other business now or
hereafter existing or contemplated directly with the Guarantor, the Borrower or
any Subsidiary; except to the extent such information (i) was or becomes
generally available to the public other than as a result of disclosure by the
Lender, or (ii) was or becomes available on a non-confidential basis from a
source other than the Guarantor or the Borrower, provided that such source is
not bound by a confidentiality agreement with the Guarantor or the Borrower
known to the Lender; provided, however, that any Lender may disclose such
information (A) at the request or pursuant to any requirement of any
Governmental Authority to which the Lender is subject or in connection with an
examination of such Lender by any such authority; (B) pursuant to subpoena or
other court process; (C) when required to do so in accordance with the
provisions of any applicable Requirement of Law; (D) to the extent reasonably
required in connection with any litigation or proceeding to which the
Administrative Agent, any Lender or their respective Affiliates may be party;
(E) to the extent reasonably required in connection with the exercise of any
remedy hereunder or under any other Loan Document; (F) to such Lender's
independent auditors and other professional advisors; (G) to any Participant or
Assignee, actual or potential, provided that such Person agrees in writing to
keep such information confidential to the same extent required of the Lenders
hereunder; (H) as to any Lender or its Affiliate, as expressly permitted under
the terms of any other document or agreement regarding confidentiality to which
the Guarantor, the Borrower or any Subsidiary is party or is deemed party with
such Lender or such Affiliate; and (I) to its Affiliates which are either such
Lender's parent or it or its parent's wholly owned Subsidiary or, with the prior
written consent of the Borrower which shall not be unreasonably withheld, its
other Affiliates.
SECTION 10.10 Set-off. In addition to any rights and remedies of the
Lenders provided by law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Borrower, any such notice being waived by the
67
Borrower to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held by, and other indebtedness at any time owing by, such Lender to or for
the credit or the account of the Borrower against any and all Obligations owing
to such Lender, now or hereafter existing, irrespective of whether or not the
Administrative Agent or such Lender shall have made demand under this Agreement
or any Loan Document and although such Obligations may be contingent or
unmatured. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such set-off and application made by such Lender;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application.
SECTION 10.11 Notification of Addresses, Lending Offices, Etc. Each
Lender shall notify the Administrative Agent in writing of any changes in the
address to which notices to the Lender should be directed, of addresses of any
Lending Office, of payment instructions in respect of all payments to be made to
it hereunder and of such other administrative information as the Administrative
Agent shall reasonably request.
SECTION 10.12 Counterparts. This Agreement may be executed in any number
of separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.
SECTION 10.13 Severability. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required hereunder
shall not in any way affect or impair the legality or enforceability of the
remaining provisions of this Agreement or any instrument or agreement required
hereunder.
SECTION 10.14 No Third Parties Benefited. This Agreement is made and
entered into for the sole protection and legal benefit of the Borrower, the
Lenders, the Administrative Agent and the Agent-Related Persons, and their
permitted successors and assigns, and no other Person shall be a direct or
indirect legal beneficiary of, or have any direct or indirect cause of action or
claim in connection with, this Agreement or any of the other Loan Documents.
SECTION 10.15 Governing Law and Jurisdiction. (a) THIS AGREEMENT SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
ILLINOIS; PROVIDED THAT THE ADMINISTRATIVE AGENT AND THE LENDERS SHALL RETAIN
ALL RIGHTS ARISING UNDER FEDERAL LAW.
68
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF ILLINOIS
OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION
AND DELIVERY OF THIS AGREEMENT, EACH OF THE BORROWER, THE ADMINISTRATIVE AGENT
AND THE LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE BORROWER, THE
ADMINISTRATIVE AGENT AND THE LENDERS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO. THE BORROWER, THE ADMINISTRATIVE AGENT AND THE LENDERS EACH
WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS AND
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE
PREPAID OR BY ANY OTHER MEANS PERMITTED BY ILLINOIS OR FEDERAL LAW.
SECTION 10.16 Waiver of Jury Trial. THE BORROWER, THE LENDERS AND THE
ADMINISTRATIVE AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON,
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. THE BORROWER, THE LENDERS AND THE ADMINISTRATIVE AGENT EACH AGREE
THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A
JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR
RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO
ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART,
TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.
SECTION 10.17 Entire Agreement. This Agreement, together with the other
Loan Documents, embodies the entire agreement and understanding among the
Borrower, the Lenders and the Administrative Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof.
69
RENAISSANCE U.S. HOLDINGS, INC.
By:
----------------------------------------
Title:
-------------------------------------
S-1
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as
Administrative Agent and Lender
By: /s/ Gary R. Peet
---------------------------------------
Title: Managing Director
------------------------------------
S-2
FLEET NATIONAL BANK, as Lender
By: /s/ Thomas McKinley
---------------------------------------
Title: SVP
------------------------------------
S-3
MELLON BANK N.A., as Lender
By: /s/ Edward Chidine
---------------------------------------
Title: Vice President
------------------------------------
S-4
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCH, as Lender
By: /s/ John S. McGill
---------------------------------------
Title: Vice President
-------------------------------------
By: /s/ Gayma Shivnarain
---------------------------------------
Title: Vice President
-------------------------------------
S-5
FIRST UNION NATIONAL BANK, as
Lender
By: /s/ Gail Golightly
---------------------------------------
Title: Senior Vice President
-------------------------------------
S-6
SCHEDULE 1.2
Pricing Grid
S-7
SCHEDULE 2.1
COMMITMENTS
Revolving Loan
Commitment Term Loan Pro Rata
Lender Amount Commitment Share
- ------ -------------- ---------- --------
Bank of America $ 3,600,000 $ 8,400,000 24.0000%
National Trust &
Savings Associa-
tion
Fleet National Bank $ 2,850,000 $ 6,650,000 19.0000%
Mellon Bank, N.A. $ 2,850,000 $ 6,650,000 19.0000%
First Union
National Bank $ 2,850,000 $ 6,650,000 19.0000%
Deutsche Bank AG $ 2,850,000 $ 6,650,000 19.0000%
=========== ===========
$15,000,000 $35,000,000 100.0000%