Exhibit (a)(1)(i)
TORTOISE ENERGY INDEPENDENCE FUND, INC.
6363 COLLEGE BOULEVARD, SUITE 100A
OVERLAND PARK, KANSAS 66211
October 2, 2023
Dear Stockholder:
The Fund is hereby commencing its purchase offer under which the Fund is offering to purchase up to 5% of the Fund’s outstanding shares. The offer to purchase is for cash at a price equal to 98% of the Fund’s net asset value as of the close of regular trading on the New York Stock Exchange on November 1, 2023 or such later date to which the offer to purchase is extended, the Expiration Date, upon the terms and conditions set forth in the Offer to Purchase and the related Letter of Transmittal (which together constitute the “Offer”). If you are not interested in selling any of your shares at this time, you do not need to do anything.
The deadline for participating in the Offer is the Expiration Date. Stockholders who choose to participate in the Offer can expect to receive payment for the shares repurchased on or about November 8, 2023, if the Offer is not extended beyond November 1, 2023.
The Fund’s common stock has at times traded at a premium to the Fund’s net asset value per share. It may not be in a stockholder’s interest to tender shares in connection with the Offer if the Fund’s common stock is trading at a premium. The market price of the Fund’s common stock can and does fluctuate. Accordingly, on the Expiration Date, the market price of the Fund’s common stock may be above or below the Fund’s net asset value per share.
As of September 25, 2023, the Fund’s net asset value per share was $36.03, and 1,753,698 shares were issued and outstanding. The Fund computes its net asset value on a daily basis. The Fund’s net asset value and the closing price of the Fund’s common stock on the New York Stock Exchange may be obtained from our website at cef.tortoiseecofin.com or by contacting Georgeson LLC, the Fund’s Information Agent, toll free at 1-866-432-2791.
Neither the Fund, the Investment Manager nor the Fund’s Board of Directors is making any recommendation to any stockholder whether to tender or refrain from tendering shares in the Offer. The Fund and the Board of Directors urge each stockholder to read and evaluate the Offer and related materials carefully and make his or her own decision. Questions, requests for assistance and requests for additional copies of this Offer to Purchase and related materials should be directed to Georgeson LLC toll free at 1-866-432-2791.
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Sincerely,
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P. BRADLEY ADAMS
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Chief Executive Officer
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TORTOISE ENERGY INDEPENDENCE FUND, INC.
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OFFER TO PURCHASE
_____________________
OFFER BY
TORTOISE ENERGY INDEPENDENCE FUND, INC.
TO PURCHASE UP TO 5%
OF ITS ISSUED AND OUTSTANDING
SHARES OF COMMON STOCK
_____________________
THIS OFFER TO PURCHASE WILL EXPIRE ON NOVEMBER 1, 2023
AT 5:00 P.M., NEW YORK CITY TIME UNLESS THE OFFER TO
PURCHASE IS EXTENDED
_____________________
THIS OFFER TO PURCHASE AND THE ACCOMPANYING LETTER OF TRANSMITTAL (WHICH TOGETHER CONSTITUTE THE “OFFER”) ARE NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED, BUT ARE SUBJECT TO OTHER CONDITIONS AS OUTLINED HEREIN AND IN THE LETTER OF TRANSMITTAL.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THE OFFER OTHER THAN THOSE CONTAINED HEREIN AND IN THE LETTER OF TRANSMITTAL, AND IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MAY NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY TORTOISE ENERGY INDEPENDENCE FUND, INC.
October 2, 2023
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SUMMARY TERM SHEET
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SECURITIES SOUGHT:
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Up to 5% of the outstanding shares of common stock of the Fund
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PRICE OFFERED PER SHARE:
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98% of the net asset value (“NAV”) of the shares of the Fund’s common stock
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SCHEDULED EXPIRATION TIME & DATE:
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November 1, 2023 at 5:00 PM New York City Time
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PURCHASER:
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Tortoise Energy Independence Fund, Inc.
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This Summary Term Sheet highlights certain information in this Offer to Purchase for a Stockholder (as defined herein). To understand the Offer (as defined herein) fully and for a more complete description of the terms of the Offer, please read carefully the entire Offer to Purchase and the related Letter of Transmittal (which together constitute the “Offer”) in their entirety because the information in this summary term sheet is not complete and additional important information is contained in the Offer.
What and how many securities Tortoise Energy Independence Fund, Inc. (the “Fund”) offering to purchase?
The Board of Directors of the Fund has authorized the Fund to conduct a cash tender offer to purchase up to 5% or 87,684 (the “Offer Amount”) of its outstanding shares of common stock (“Shares”). If the number of Shares properly tendered and not withdrawn prior to the date and time the Offer expires is less than or equal to the Offer Amount, the Fund will, upon the terms and subject to the conditions of the Offer, purchase all Shares tendered. If more Shares than the Offer Amount are properly tendered and not withdrawn prior to the date the Offer expires, the Fund will purchase the Offer Amount on a pro rata basis. Shareholders cannot be assured that all of their tendered Shares will be repurchased. For more information see Section 1, “Number of Shares,” Section 2, “Price” and Section 14, “Extension of Tender Period; Termination; Amendments.”
How much and in what form will the Fund pay me for my Shares?
The Fund will pay cash for Shares purchased pursuant to the Offer, less any applicable withholding taxes. The purchase price will equal 98% of the NAV per Share as of the close of regular trading on the New York Stock Exchange (“NYSE”) as of the day the Offer expires (or if the Offer is extended, on the date to which the Offer is extended), upon the terms and subject to the conditions set forth in the Offer.
The Shares are traded on the NYSE under the ticker symbol “NDP.” As of September 25, 2023, the closing price as of the close of the regular trading session of the NYSE was $31.50 per Share. The Fund normally calculates the NAV of its Shares daily at the close of regular trading on the NYSE. On September 25, 2023, the NAV was $36.03. During the pendency of the Offer, current NAV quotations can be obtained from our website at cef.tortoiseecofin.com or from Georgeson LLC, the information agent for the Offer (“Information Agent”) at 1-866-432-2791. For more information see Section 2, “Price” and Section 7, “Acceptance for Payment and Payment.”
When does the Offer expire? Can the Fund extend the Offer, and if so, when will the Fund announce the extension?
• The Offer expires on November 1, 2023 at 5:00 p.m., New York City Time, unless the Fund extends the Offer. The later of November 1, 2023 and the latest time or date to which the Offer is extended is hereinafter called the “Expiration Date.”
• The Fund may extend the Offer period at any time. If it does, the Fund will determine the purchase price as of the close of regular trading on the NYSE as of the new Expiration Date.
• If the Offer period is extended, the Fund will make a public announcement of the extension no later than 9:00 a.m. New York City Time on the next business day following the previously scheduled Expiration Date.
If you hold your Shares directly, you have until the Expiration Date to decide whether to tender your Shares in the Offer. If you want to tender your Shares, but your certificates for the Shares are not immediately available or cannot be delivered to the Depositary, you cannot comply with the procedure for book-entry transfer or you cannot deliver the other required documents to the Depositary by the Expiration Date of the Offer, you will not be able to tender your Shares. This can occur, for example, if you purchased Shares at, or within one or two days of, the Expiration
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Date, not allowing sufficient time for such purchase transaction to settle. There are guaranteed delivery procedures available under the terms of the Offer as an alternative delivery mechanism. If you hold your Shares through a nominee holder, such as a broker, dealer, commercial bank, trust company or other nominee (“Nominee Holder”), you should consult your broker or other Nominee Holder to determine if there is an earlier deadline by which you must inform such Nominee Holder of any decision to tender your Shares and provide to such Nominee Holder any other required materials. For more information see Section 5, “Procedure for Tendering Shares” and Section 14, “Extension of Tender Period; Termination; Amendments.”
What if more than 5% of the outstanding Shares are tendered (and not timely withdrawn)?
The Fund will purchase duly tendered Shares from tendering stockholders pursuant to the terms and conditions of the Offer on a pro rata basis (disregarding fractions) in accordance with the number of Shares tendered by each Stockholder (and not properly withdrawn), unless the Fund determines not to purchase any Shares in the event that the conditions described in Section 8 of this Offer to Purchase are present. The Fund’s present intention, if the Offer is oversubscribed, is not to purchase more than 5% of the outstanding Shares. For more information see Section 1, “Number of Shares.”
Must I tender all of my Shares for repurchase?
No. You may tender for repurchase all or part of the Shares you own.
Will I have to pay any fees or commissions on Shares I tender?
No fees or commissions will be payable to the Fund in connection with the Offer. However, brokers, dealers, or other persons may charge Shareholders a fee for submitting tenders into the Offer. Shareholders may be obligated to pay transfer taxes on the purchase of Shares by the Fund and other transaction costs. Please contact your bank, broker, or nominee for more details. For more information see Section 2, “Price,” Section 7, “Acceptance for Payment and Payment” and Section 12, “Certain Fees and Expenses.”
How will the Fund pay for the Offer?/Does the Fund have the financial resources to pay me for my Shares?
Yes. Funds obtained from cash, liquid securities in the Fund’s investment portfolio or borrowings will be used to finance the purchase of any tendered shares. For more information see Section 4, “Effect of the Offer; Source and Amount of Funds.”
If Shares I tender are accepted by the Fund, when will payment be made?
Payment for tendered Shares, if accepted, will be made promptly after the termination date of the Offer.
How do I tender my Shares?
If your Shares are registered in the name of a Nominee Holder, you should contact that firm if you wish to tender your Shares.
All other Shareholders wishing to participate in the Offer must, prior to the date and time the Offer expires, complete and execute a Letter of Transmittal, together with any required signature guarantees, and any other documents required by the Letter of Transmittal. You must send these materials to the Depositary at its address set forth on the last page of this Offer to Purchase. If you hold certificates for Shares, you must send the certificates to the Depositary at its address set forth on the last page of this Offer to Purchase. If your Shares are held in book-entry form, you must comply with the book-entry delivery procedure set forth in Section 5 of this Offer to Purchase. In all these cases, the Depositary must receive these materials prior to the date and time the Offer expires.
The Fund’s transfer agent holds Shares in uncertificated form for certain Shareholders pursuant to the Fund’s dividend reinvestment and cash purchase plan. When a Shareholder tenders share certificates, the Depositary will accept any of the Shareholder’s uncertificated Shares for tender first, and accept the balance of tendered Shares from the Shareholder’s certificated Shares. For more information see Section 5, “Procedure for Tendering Shares.”
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Until what time can I withdraw tendered Shares?
You may withdraw your tendered Shares at any time prior to the Expiration Date, and if the Shares have not by then been accepted for payment by the Fund, at any time after December 1, 2023. Otherwise, after the Expiration Date, tenders made pursuant to the Offer will be irrevocable.
Withdrawals of tenders of Shares may not be rescinded, and any Shares validly withdrawn will thereafter be deemed not validly tendered for purposes of the Offer. However, withdrawn Shares may be retendered by following one of the procedures described in Section 5 of this Offer to Purchase at any time before the Expiration Date. For more information see Section 6, “Withdrawal or Modification of Tender of Shares for Purchase.”
How do I withdraw tendered Shares?
If you desire to withdraw tendered Shares, you should either:
• Give proper written notice to the Depositary; or
• If your Shares are held of record in the name of a Nominee Holder, contact that firm to withdraw your tendered Shares.
For more information see Section 6, “Withdrawal or Modification of Tender of Shares for Purchase.”
What are the tax consequences of tendering Common Shares?
The receipt of cash for Shares pursuant to the Offer by a U.S. shareholder other than a Shareholder exempt from tax or investing through a tax-advantaged arrangement generally will be a taxable transaction for U.S. federal income tax purposes and may also be a taxable transaction under applicable state, local, foreign and other tax laws. For U.S. federal income tax purposes, the sale of your Shares for cash generally will be treated either as (1) a sale or exchange of the Shares, or (2) a distribution with respect to the Shares that is treated in whole or in part as taxable dividend. Each Shareholder should consult its tax adviser as to the tax consequences of tendering its Common Shares in the Offer. For more information see Section 15, “Certain Federal Income Tax Consequences.”
What is the purpose of the Offer?
The Offer will permit tendering Stockholders to liquidate at least a portion of their Shares at approximately 98% of NAV, while preserving the Fund as an investment vehicle for total return for the remaining non-tendering Stockholders. In approving the Offer, the Board of Directors (“Board”) of the Fund considered a number of factors, including: the economic condition of the investment markets; that the Offer could provide an opportunity for Stockholders to achieve partial liquidity at close to NAV; that the Offer could enable Stockholders to tender a portion of their Shares at a price that is greater than what they could realize in the secondary market at that time; that the Offer is expected to have an accretive impact to NAV for Stockholders who remain invested in the Fund; that the Offer may assist in narrowing the discount to NAV at which the Shares trade; and that the Tortoise Capital Advisors, L.L.C. (the “Investment Manager”) recommended the Offer to the Board.
After considering the totality of the factors listed in this paragraph and other factors, none of which standing on its own was dispositive, the Board determined to authorize this Offer. There is no guarantee that the Offer will be accretive to the Fund’s NAV. There can be no assurance that this Offer will have the effect of narrowing the discount or that any reduction in the discount will be sustained following the expiration of the Offer. Any Shares acquired by the Fund pursuant to the Offer will become authorized but unissued Shares and will be available for issuance by the Fund without further Stockholder action (except as required by applicable law or the rules of national securities exchanges on which the Shares are listed).
Please bear in mind that none of the Fund, its Board, nor the Investment Manager has made any recommendation as to whether or not you should tender your Shares. Stockholders are urged to consult their own investment and tax advisers and make their own decisions whether to tender any Shares and, if so, how many Shares to tender. For more information see Section 3, “Purpose of the Offer.”
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What are the most significant conditions of the Offer?
The Fund will not accept Shares tendered for payment under any one of the following circumstances that, in the view of the Board, would make it inadvisable to proceed with the Offer, purchase or payment. The following is only a summary of the conditions. For a complete list of the conditions of the Offer, please see Section 8, “Certain Conditions of the Offer.”
• The Fund would be required to sell a greater amount of portfolio securities to fund the Offer than the Fund would be able to sell in an orderly manner or such sale would have an adverse effect on the NAV of the Fund to the detriment of those Stockholders who do not tender their Shares.
• The offer could impair compliance with U.S. Securities and Exchange Commission or Internal Revenue Service requirements.
• Trading generally or prices on the NYSE or National Association of Securities Dealers Automated Quotation System are suspended or limited.
• The purchase of Shares in the offer would result in the delisting of the Shares from the NYSE.
• In the Board’s judgment, there is a material legal action or proceeding instituted or threatened, challenging the offer or otherwise potentially materially adversely affecting the Fund.
• Certain circumstances exist beyond the Fund’s control, including limitations imposed by federal or state authorities on the extension of credit by lenders or where banks have suspended payment.
• In the Board’s judgment, the Fund or its Stockholders might be adversely affected if Shares were purchased in the offer.
• The Board determines that the purchase of Shares might be a breach of its fiduciary duty.
If I decide not to tender, how will the Offer affect my Shares?
If you do not tender your Shares (or if you own Shares following completion of the Offer), your percentage ownership interest in the Fund will increase after the completion of the Offer and you will be subject to any increased risks associated with the reduction in the Fund’s total assets due to the payment for the tendered Shares. These risks may include greater volatility due to a decreased asset base and proportionately higher expenses, as well as the possibility of receiving additional taxable capital gains on the distributions from the sale of portfolio securities to pay for tendered Shares. The reduced assets of the Fund as a result of the Offer may result in less investment flexibility for the Fund, depending on the number of Shares repurchased and may have an adverse effect on the Fund’s expense ratio and investment performance. For more information see Section 4, “Effect of the Offer; Source and Amount of Funds” and Section 12, “Certain Fees and Expenses.”
What action need I take if I decide not to tender my Shares?
None.
Whom do I contact if I have questions about the Offer?
If you own Shares through a broker or other Nominee Holder, you can call your broker or other Nominee Holder. You can also contact Georgeson LLC, the Information Agent, at 1-866-432-2791, Monday through Friday, 9 a.m. to 5 p.m., New York City Time.
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To the Stockholders of Tortoise Energy Independence Fund, Inc.:
1. Number of Shares. Tortoise Energy Independence Fund, Inc. (the “Fund”), a Maryland corporation registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a closed-end, non-diversified management investment company, hereby offers to purchase up to 5% of the issued and outstanding shares of common stock in the Fund (the “Shares”) as of October 2, 2023 (the “Offer Amount”), which are tendered and not withdrawn prior to 5:00 p.m., New York City Time, on November 1, 2023 or such later date to which the Offer is extended (the “Expiration Date”).
This Offer is being made to all stockholders of the Fund (“Stockholders”) and is not conditioned upon any minimum number of Shares being tendered. NEITHER THE FUND, ITS BOARD OF DIRECTORS (THE “BOARD”) NOR THE INVESTMENT MANAGER IS MAKING ANY RECOMMENDATION TO ANY STOCKHOLDER WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES IN THE OFFER. The Fund and the Board urge each Stockholder to read and evaluate the Offer and related materials carefully and make his or her own decision.
If the number of Shares properly tendered and not withdrawn prior to the Expiration Date is less than or equal to the Offer Amount, the Fund will, upon the terms and conditions of the Offer, purchase all Shares so tendered. If more Shares than the Offer Amount are duly tendered and not withdrawn prior to the Expiration Date, the Fund will purchase the Offer Amount of Shares on a pro rata basis.
As of September 25, 2023, 1,753,698 Shares were issued and outstanding. The Fund does not anticipate that the number of Shares as of the Expiration Date will be materially different.
2. Price. The offer is to purchase Shares in exchange for cash at a price equal to ninety eight percent (98%) of the net asset value (“NAV”) per Share (the “Purchase Price”) determined as of the close of the regular trading session of the New York Stock Exchange (the “NYSE”) on the Expiration Date.
On the Expiration Date, the market price of the Shares may be above or below the Fund’s NAV per Share.
Stockholders can obtain the daily NAV of the Shares and daily NYSE closing price of the Shares on our website at cef.tortoiseecofin.com or by calling Georgeson LLC toll free at 1-866-432-2791.
The Shares are listed on the NYSE under the symbol “NDP.” On September 25, 2023, the closing price on the NYSE was $31.50 per Share.
3. Purpose of the Offer. As with many closed-end investment companies, the trading price of the Shares on the NYSE has historically been at a discount to, i.e., lower than, the NAV of the Shares. The Offer will permit tendering Stockholders to liquidate at least a portion of their Shares at approximately 98% of NAV, while preserving the Fund as an investment vehicle for total return for the remaining non-tendering Stockholders. In approving the Offer, the Board of Directors (“Board”) of the Fund considered a number of factors, including: the economic condition of the investment markets; that the Offer could provide an opportunity for Stockholders to achieve partial liquidity at close to NAV; that the Offer could enable Stockholders to tender a portion of their Shares at a price that is greater than what they could realize in the secondary market at that time; that the Offer is expected to have an accretive impact to NAV for Stockholders who remain invested in the Fund; that the Offer may assist in narrowing the discount to NAV at which the Shares trade; and that the Investment Manager recommended the Offer to the Board.
After considering the totality of the factors listed in this paragraph and other factors, none of which standing on its own was dispositive, the Board determined to authorize this Offer. There is no guarantee that the Offer will be accretive to the Fund’s NAV.
There can be no assurance, however, that this Offer will have the effect of narrowing the discount or that any reduction in the discount will be sustained following the expiration of the Offer. Any Shares acquired by the Fund pursuant to the Offer will become authorized but unissued Shares and will be available for issuance by the Fund without further Stockholder action (except as required by applicable law or the rules of national securities exchanges on which the Shares are listed).
NONE OF THE FUND, ITS BOARD OR THE INVESTMENT MANAGER MAKES ANY RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO TENDER ANY OR ALL OF SUCH STOCKHOLDER’S SHARES. STOCKHOLDERS ARE URGED TO EVALUATE CAREFULLY ALL
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INFORMATION IN THE OFFER, CONSULT THEIR OWN INVESTMENT AND TAX ADVISERS, AND MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER.
4. Effect of the Offer; Source and Amount of Funds. The actual cost to the Fund of the Offer cannot be determined at this time because the number of Shares to be purchased will depend on the number tendered, and the price will be based on the NAV per Share on the Expiration Date. If the NAV per Share on the Expiration Date is the same as the NAV per Share on September 25, 2023 ($36.03 per Share), and if 5% of the outstanding Shares are purchased pursuant to the Offer, the cost to the Fund (excluding expenses) would be $3,096,069.43.
The monies to be used by the Fund to purchase Shares pursuant to the Offer will be obtained from cash, liquid securities in the Fund’s investment portfolio or borrowings on the credit facility.
The Fund is a party to a credit agreement (the “Credit Agreement”) with The Bank of Nova Scotia to borrow up to a limit of $12 million pursuant to a 364-day unsecured revolving line of credit. Interest is charged at a spread above the Secured Overnight Financing Rate and is payable quarterly. The Fund is required to maintain certain net asset levels during the term of the Credit Agreement.
The Offer may have certain adverse consequences for tendering and non-tendering Stockholders:
Effect on NAV and Consideration Received by Tendering Stockholders. To pay the aggregate purchase price of Shares accepted for payment pursuant to the Offer, the Fund anticipates that funds will be first derived from any cash on hand and then from the proceeds from the sale of portfolio securities held by the Fund or from the Fund’s credit arrangements. If the Fund is required to sell a substantial amount of portfolio securities to raise cash to finance the Offer, the over-supply of portfolio securities for sale could cause market prices of the Fund’s portfolio securities, and hence the Fund’s NAV, to decline. If such a decline occurs, the Fund cannot predict what its magnitude might be or whether such a decline would be temporary or continue to or beyond the Expiration Date. Because the price per Share to be paid in the Offer will be dependent upon the NAV as determined on the Expiration Date, if such a decline continued to the Expiration Date, the consideration received by tendering Stockholders would be less than it otherwise might be. In addition, a sale of portfolio securities will cause increased transaction expenses, and the Fund may receive proceeds from the sale of portfolio securities that are less than the valuations of such securities by the Fund. Accordingly, because of the Offer, the NAV per Share may decline more than it otherwise might, thereby reducing the amount of proceeds received by tendering Stockholders, and also reducing the NAV for non-tendering Stockholders. However, because the Offer price is for 98% of the NAV of the Shares, the purchase of Shares tendered in and of itself would be somewhat accretive to the NAV of Shares outstanding following completion of the Offer.
The Fund may sell portfolio securities during the pendency of the Offer to raise cash for the purchase of Shares. Thus, it is likely that during the pendency of the Offer, and possibly for a short time thereafter, the Fund will hold a greater than normal percentage of its net assets in cash and cash equivalents. This larger cash position may interfere with the Fund’s ability to meet its investment objective. The Fund is required by law to pay for tendered Shares it accepts for payment promptly after the Expiration Date of this Offer. Because the Fund will not know the number of Shares tendered, or the NAV on which the tender price is based, until the Expiration Date, the Fund will not know until the Expiration Date the amount of cash required to pay for such Shares. If on or prior to the Expiration Date the Fund does not have, or believes it is unlikely to have, sufficient cash to pay for all Shares tendered, it may extend the Offer to allow additional time to sell portfolio securities or increase its borrowing under its current credit arrangement to raise sufficient cash.
Possible Proration: If greater than 5% of the Fund’s Shares are tendered pursuant to the Offer, the Fund would be required to purchase Shares tendered on a pro rata basis, subject to certain exceptions described in Section 1, “Number of Shares.” Accordingly, Stockholders cannot be assured that all of their tendered Shares will be purchased.
Recognition of Capital Gains: As noted, the Fund may be required to sell portfolio securities pursuant to the Offer, in which event it might recognize capital gains. The Fund expects that it would distribute any such gains to Stockholders (reduced by net capital losses realized during the fiscal year, if any) following the end of its fiscal year on November 30. This recognition and distribution of gains, if any, would have two negative consequences: first, Stockholders at the time of declaration of the distributions would be required to pay taxes on a greater amount of capital gain distributions than otherwise would be the case; and second, to raise cash to make the distributions, the Fund might need to sell additional portfolio securities, thereby possibly realizing and recognizing additional capital gains. It is
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impossible to predict the amount of capital gains or losses that would be realized and recognized. In addition, some of the distributed gains may be realized on securities held for one year or less, which would generate income taxable to the Stockholders at ordinary income rates.
Tax Consequences of Purchases to Stockholders: The Fund’s purchase of tendered Shares pursuant to the Offer will have tax consequences for tendering Stockholders and may have tax consequences for non-tendering Stockholders. See Section 15, “Certain Federal Income Tax Consequences,” below.
Effect on Remaining Stockholders, Higher Expense Ratio and Less Investment Flexibility: The purchase of Shares by the Fund pursuant to the Offer will have the effect of increasing the proportionate interest in the Fund of non-tendering Stockholders. All Stockholders remaining after the Offer will be subject to any increased risks associated with the reduction in the Fund’s aggregate assets resulting from payment for the tendered Shares, such as greater volatility due to decreased diversification, potentially greater exposure to leverage, and proportionately higher expenses. The reduced net assets of the Fund as a result of the Offer may result in less investment flexibility for the Fund, depending on the number of Shares purchased, and may have an adverse effect on the Fund’s investment performance.
5. Procedure for Tendering Shares. The Fund has retained Computershare Inc. and its wholly owned subsidiary Computershare Trust Company, N.A. (together “Computershare”) to act as Depositary for purposes of this Offer (the “Depositary”). Stockholders may tender some or all of their Shares by delivering or mailing a Letter of Transmittal or facsimile thereof (together with certificates and other required documents) to the Depositary at the appropriate address set forth at the end of this Offer or by following the procedures for book-entry delivery set forth below (and causing a confirmation of receipt of such delivery to be received by the Depositary). In lieu of the foregoing, tendering Stockholders can comply with the guaranteed delivery procedures set forth below.
To tender Shares properly, the certificates for Shares, together with a properly completed and duly executed Letter of Transmittal (or facsimile thereof) and any other documents required by the Letter of Transmittal, must be received prior to the Expiration Date by the Depositary at the appropriate address set forth at the end of this Offer, except as otherwise provided below in this Section. Letters of Transmittal and certificates representing tendered Shares should NOT be sent or delivered directly to the Fund. Stockholders having Shares registered in the name of a broker, dealer, commercial bank, trust company or other nominee should contact such firm if they desire to tender their Shares.
Signatures on all Letters of Transmittal must be guaranteed by a member firm of a registered national securities exchange, a member of the Financial Industry Regulatory Authority, Inc. or a commercial bank or trust company having an office, branch or agency in the United States (each being hereinafter referred to as an “Eligible Institution”), except in cases where Shares are tendered (i) by a registered holder of Shares who has not completed either the box entitled “Special Payment Instructions” or the box entitled “Special Delivery Instructions” on the Letter of Transmittal or (ii) for the account of an Eligible Institution. See Instruction 1 of the Letter of Transmittal. If the certificates are registered in the name of a person other than the signer of the Letter of Transmittal, or if payment is to be made to a person other than the registered owner of the certificates surrendered, then the certificates must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name or names of the registered owner or owners appear on the certificates, with the signature(s) on the certificates or stock powers guaranteed as aforesaid. See Instruction 6 of the Letter of Transmittal.
The Fund’s transfer agent holds Shares in uncertificated form for certain Stockholders pursuant to the Fund’s dividend reinvestment plan. Stockholders may tender all such uncertificated Shares by completing the appropriate section in the Letter of Transmittal or Notice of Guaranteed Delivery. There may be tax consequences to a tendering Stockholder who tenders less than all Shares he or she owns. See Section 15, “Certain Federal Income Tax Consequences,” below.
The Depositary will establish accounts with respect to the Shares at the Depository Trust Company (“DTC”) for purposes of the Offer within two business days after the date of this Offer to Purchase. Any financial institution that is a participant in DTC’s system may make delivery of tendered Shares by causing DTC to transfer such Shares into the Depositary’s account in accordance with DTC’s procedure for such transfer. However, although delivery of Shares may be effected through transfer into the Depositary’s account at DTC, the Letter of Transmittal (or facsimile thereof), with any required signature guarantee and any other required documents, must, in any case, be transmitted
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to and received by the Depositary at the appropriate address set forth at the end of this Offer to Purchase before the Expiration Date, or the tendering Stockholder must comply with the guaranteed delivery procedure described below. Delivery of documents to DTC in accordance with DTC’s procedures does not constitute delivery to the Depositary.
If certificates for Shares are not immediately available or time will not permit the Letter of Transmittal and other required documents to reach the Depositary prior to the Expiration Date, Shares may nevertheless be tendered provided that all of the following conditions are satisfied:
(a) such tenders are made by or through an Eligible Institution; and
(b) the Depositary receives, prior to the Expiration Date, a properly completed and duly executed Notice of Guaranteed Delivery substantially in the form provided by the Fund (delivered either by mail or email); and
(c) the certificates for all tendered Shares, or book-entry confirmation, as the case may be, together with a properly completed and duly executed Letter of Transmittal and any other documents required by the Letter of Transmittal, are received by the Depositary within two NYSE trading days after receipt by the Depositary of such Notice of Guaranteed Delivery.
THE METHOD OF DELIVERY OF THE CERTIFICATES REPRESENTING SHARES, LETTER OF TRANSMITTAL, AND ANY OTHER DOCUMENTS IS AT THE OPTION AND RISK OF THE STOCKHOLDER. IF THE STOCKHOLDER WISHES TO DELIVER BY MAIL, WE RECOMMEND THE USE OF INSURED REGISTERED MAIL, RETURN RECEIPT REQUESTED. THE STOCKHOLDER HAS THE RESPONSIBILITY TO CAUSE THE CERTIFICATES, LETTER OF TRANSMITTAL AND ANY OTHER DOCUMENTS TO BE TIMELY DELIVERED.
TO PREVENT BACKUP WITHHOLDING ON PAYMENTS MADE FOR THE PURCHASE OF SHARES PURSUANT TO THE OFFER, EACH INDIVIDUAL STOCKHOLDER (AND CERTAIN OTHER NONCORPORATE STOCKHOLDERS) MUST PROVIDE THE DEPOSITARY WITH HIS CORRECT TAXPAYER IDENTIFICATION NUMBER BY COMPLETING THE SUBSTITUTE FORM W-9 INCLUDED WITH THE LETTER OF TRANSMITTAL (EVEN IF SUCH STOCKHOLDER HAS PREVIOUSLY COMPLETED SUCH A FORM). CERTAIN STOCKHOLDERS WHO ARE NOT CITIZENS OR RESIDENTS OF THE UNITED STATES MAY SATISFY THIS REQUIREMENT BY PROVIDING A CERTIFICATE OF FOREIGN STATUS (GENERALLY, AN INTERNAL REVENUE SERVICE FORM W-8BEN) TO THE DEPOSITARY IN LIEU OF THE SUBSTITUTE FORM W-9. SEE SECTION 15, “CERTAIN FEDERAL INCOME TAX CONSEQUENCES,” BELOW AND INSTRUCTION 11 OF THE LETTER OF TRANSMITTAL.
All questions as to the validity, form, eligibility (including time of receipt) and acceptance of any Shares tendered will be determined by the Fund, which determination shall be final and binding. The Fund reserves the absolute right (i) to reject any and all tenders not in proper form or the payment for which would, in the opinion of the Fund’s counsel, be unlawful and (ii) to waive any of the conditions of the Offer or any defect or irregularity in the tender of any Shares. The Fund’s determination of any defect or irregularity in the tender of any Shares and its interpretation of the terms and conditions of the Offer (including the Letter of Transmittal and the Instructions thereto) will be final. None of the Fund, the Information Agent, the Depositary or any other person shall be under any duty to give notification of any defects or irregularities in tenders, and none shall incur any liability for failure to give such notification.
6. Withdrawal or Modification of Tender of Shares for Purchase. Shares tendered pursuant to the Offer may be withdrawn or you may change the number of Shares tendered for purchase at any time prior to the Expiration Date, and if the Shares have not by then been accepted for payment by the Fund, at any time after December 1, 2023. After the Expiration Date, tenders made pursuant to the Offer will be irrevocable.
To be effective, a written or emailed notice of withdrawal or notice of modification, as applicable, must be timely received by the Depositary. Such notice must specify the name of the person who executed the particular Letter of Transmittal or Notice of Guaranteed Delivery, the number of Shares to be withdrawn or the modified number of Shares to be tendered and, if certificates have been delivered or otherwise identified to the Depositary, the name of the holder of record and the serial numbers of the certificates representing such Shares. If Shares have been delivered pursuant to the procedure for book- entry delivery as set forth in Section 5, “Procedure for Tendering Shares,” any notice of
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withdrawal or notice of modification, as applicable, also must specify the name and the number of the account at DTC to be debited or credited with such Shares (which must be the same name and number from which the Shares were tendered), and must otherwise comply with DTC’s procedures.
All questions as to the form and validity, including time of receipt, of notices of withdrawal or notices of modification, as applicable, will be determined by the Fund, in its sole discretion, whose determination will be final and binding. None of the Fund, the Information Agent, the Depositary or any other person will be under any duty to give notification of any defects or irregularities in any notice of withdrawal or notice of modification, as applicable, or to incur any liability for failure to give any such notification. Any Shares timely and properly withdrawn will be deemed not duly tendered for purposes of the Offer.
7. Acceptance for Payment and Payment. Upon the terms and subject to the conditions of the Offer, the Fund will accept for payment, and will pay for, Shares validly tendered on or before the Expiration Date and not properly withdrawn in accordance with Section 6, “Withdrawal or Modification of Tender of Shares for Purchase,” as soon as practicable after the Expiration Date. The Fund expressly reserves the right, in its sole discretion, to delay the acceptance for payment of, or payment for, Shares, in order to comply in whole or in part with any applicable law.
The per-Share consideration paid to any Stockholder pursuant to the Offer will be the highest per-Share consideration paid to any other Stockholder during the Offer. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of certificates for such shares (or confirmation of the book-entry transfer of such shares), a properly executed Letter of Transmittal (or facsimile thereof) and any other documents required by the Letter of Transmittal.
For purposes of the Offer, the Fund will be deemed to have accepted for payment, and thereby purchased, Shares properly tendered to the Fund and not withdrawn, if, as and when the Fund gives oral or written notice to the Depositary of its acceptance for payment of such Shares. Payment for Shares accepted for payment pursuant to the Offer will be made by deposit of the purchase price with the Depositary, which will act as agent for the tendering Stockholders for purposes of receiving payment from the Fund and transmitting payment to the tendering Stockholders. Under no circumstances will the Fund pay interest on the purchase price of the Shares to be paid by the Fund, regardless of any delay in making such payment. If any tendered Shares are not accepted for payment pursuant to the terms and conditions of the Offer for any reason, or are not paid for because of an invalid tender, or if certificates are submitted for more Shares than are tendered, certificates for such unpurchased Shares will be returned, without expense to the tendering Stockholder, as soon as practicable following expiration or withdrawal of the Offer. Shares delivered by book-entry transfer into the Depositary’s account at DTC as described in Section 5, “Procedure for Tendering Shares,” which are to be returned will be credited to an account maintained within DTC. Shares which are to be returned and which were held in uncertificated form by the Fund’s transfer agent pursuant to the Fund’s dividend reinvestment plan will be returned to the dividend reinvestment plan account maintained by the transfer agent.
If the Fund is delayed in its acceptance for payment of, or in its payment for, Shares, or is unable to accept for payment or pay for Shares pursuant to the Offer for any reason, then, without prejudice to the Fund’s rights under this Offer, the Depositary may, nevertheless, on behalf of the Fund, retain tendered Shares, and such shares may not be withdrawn unless and except to the extent tendering Stockholders are entitled to withdrawal rights as described in Section 6, “Withdrawal or Modification of Tender of Shares for Purchase.”
Tendering Stockholders will not be obligated to pay brokerage commissions, fees or, except in the circumstances described in Instruction 6 of the Letter of Transmittal, transfer taxes on the purchase of Shares by the Fund.
8. Certain Conditions of the Offer. Notwithstanding any other provision of the Offer, the Fund will not accept tenders or effect purchases if: (1) such transactions, if consummated, would (a) result in delisting of the Fund’s Shares from the NYSE (the NYSE Listed Company Manual provides that the NYSE would promptly initiate suspension and delisting procedures with respect to closed-end funds if the average global market capitalization of the entity over thirty consecutive trading days is below $50,000,000); (b) impair the Fund’s status as a regulated investment company under the Code (which would make the Fund subject to U.S. federal income taxes on all of its income and gains in addition to the taxation of Stockholders who receive distributions from the Fund); or (c) result in a failure to comply with the applicable asset coverage requirements in the event any senior securities are issued and outstanding; (2) the amount of Shares tendered would require liquidation of such a substantial portion of the Fund’s portfolio securities that the Fund would not be able to liquidate portfolio securities in an orderly manner in light of the existing market conditions and such liquidation would have an adverse effect on the NAV of the Fund to the detriment of non-tendering Stockholders;
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(3) there is any (a) in the Board’s’ judgment, material legal action or proceeding instituted or threatened challenging such transactions or otherwise materially adversely affecting the Fund; (b) suspension of or limitation on prices for trading securities generally on the NYSE or other national securities exchange(s), or the National Association of Securities Dealers Automated Quotation System (“NASDAQ”) National Market System; (c) declaration of a banking moratorium by Federal or state authorities or any suspension of payment by banks in the United States or New York State; (d) limitation affecting the Fund or the issuers of its portfolio securities imposed by federal or state authorities on the extension of credit by lending institutions; (e) commencement of war, armed hostilities or other international or national calamity directly or indirectly involving the United States; or (f) in the Board’s judgment, other event or condition which would have a material adverse effect on the Fund or its Stockholders if tendered Shares were purchased; or (4) the Board determines that effecting any such transaction would constitute a breach of their fiduciary duty owed to the Fund or its Stockholders. The Board may modify these conditions in light of experience.
The Fund reserves the right, at any time during the pendency of the Offer, to terminate, extend or amend the Offer in any respect. If the Fund determines to terminate or amend the Offer or to postpone the acceptance for payment of or payment for Shares tendered, it will, to the extent necessary, extend the period of time during which the Offer is open as provided in Section 14, “Extension of Tender Period; Termination; Amendments.” In the event any of the foregoing conditions are modified or waived in whole or in part at any time, the Fund will promptly make a public announcement of such waiver and may, depending on the materiality of the modification or waiver, extend the Offer period as provided in Section 14, “Extension of Tender Period; Termination; Amendments.”
9. NAV and Market Price. The Shares currently trade on the NYSE under the symbol “NDP” The following table sets forth, on a quarterly basis, the high and low NAVs of the Shares and the high and low intraday sale prices of the Shares for each calendar quarter during the two years ended August 31, 2023.
|
|
|
NAV
|
|
Market Price*
|
| |
|
High
|
|
Low
|
|
High
|
|
Low
|
|
September 1, 2021 to November 30, 2021
|
|
$
|
27.54
|
|
$
|
21.93
|
|
$
|
24.43
|
|
$
|
19.16
|
|
December 1, 2021 to February 28, 2022
|
|
$
|
31.76
|
|
$
|
24.27
|
|
$
|
27.75
|
|
$
|
21.18
|
|
March 1, 2022 to May 31, 2022
|
|
$
|
39.08
|
|
$
|
31.45
|
|
$
|
32.86
|
|
$
|
26.41
|
|
June 1, 2022 to August 31, 2022
|
|
$
|
40.74
|
|
$
|
29.91
|
|
$
|
34.73
|
|
$
|
25.56
|
|
September 1, 2022 to November 30, 2022
|
|
$
|
40.20
|
|
$
|
31.26
|
|
$
|
35.28
|
|
$
|
26.74
|
|
December 1, 2022 to February 28, 2023
|
|
$
|
37.97
|
|
$
|
33.48
|
|
$
|
32.10
|
|
$
|
28.53
|
|
March 1, 2023 to May 31, 2023
|
|
$
|
35.51
|
|
$
|
30.68
|
|
$
|
30.45
|
|
$
|
26.30
|
|
June 1, 2023 to August 31, 2023
|
|
$
|
37.03
|
|
$
|
31.98
|
|
$
|
32.16
|
|
$
|
27.03
|
The NAV per Share computed as of the close of business on September 25, 2023 was $36.03. On September 25, 2023, the high, low and closing prices of the Shares as reported on the NYSE were $31.50, $31.04 and $31.50, respectively.
10. Information With Respect to the Fund and the Fund’s Investment Manager. The Fund is a closed-end, non- diversified management investment company organized as a Maryland corporation. The Shares were first offered to the public on July 26, 2012. As a closed-end investment company, the Fund differs from an open-end investment company (i.e., a mutual fund) in that it does not redeem its Shares at the election of a stockholder and does not continuously offer its shares for sale to the public.
Tortoise Capital Advisors, L.L.C. (“Tortoise”) serves as the Fund’s Investment Manager. Tortoise is a limited liability company organized under the laws of Delaware on October 4, 2002 and a registered investment adviser under the Investment Advisers Act of 1940. Tortoise has served as the Fund’s Investment Manager since July 26, 2012. The principal business address of Tortoise is 6363 College Boulevard, Suite 100A, Overland Park, KS 66211.
11. Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares. The members of the Fund’s Board of Directors (the “Board of Directors”) are Rand Berney, H. Kevin Birzer, Conrad Ciccotello, Alexandra Herger and Jennifer Paquette. The executive officers of the Fund are P. Bradley Adams, Chief Executive Officer, Courtney Gengler, Principal Financial Officer and Treasurer, Robert Thummel, Jr., President, Shobana Gopal, Vice President, Diane Bono, Chief Compliance Officer and Secretary, and Sean Wickliffe,
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Vice President and Assistant Treasurer. The address of each member of the Board of Directors and each executive officer of the Fund is c/o Tortoise Energy Independence Fund, Inc., 6363 College Boulevard, Suite 100A, Overland Park, Kansas 66211, and the telephone number of each member of the Board of Directors and executive officer is 913-981-1020. Based on the number of Shares outstanding as of the August 31, 2023, the following persons (the named individuals being the Directors and executive officers of the Fund) own the number of Shares indicated in the below table:
|
Person
|
|
Number of
Shares
|
|
Beneficial
Ownership
(%)
|
|
Rand Berney
|
|
1,424.49
|
(1)
|
|
*
|
|
H. Kevin Birzer
|
|
1,793.00
|
|
|
*
|
|
Conrad Ciccotello
|
|
1,708.10
|
|
|
*
|
|
Alexandra Herger
|
|
225.00
|
|
|
*
|
|
Jennifer Paquette
|
|
179.00
|
|
|
*
|
|
P. Bradley Adams
|
|
343.25
|
|
|
*
|
|
Courtney Gengler
|
|
0.00
|
|
|
*
|
|
Robert Thummel, Jr.
|
|
375.00
|
|
|
*
|
|
Shobana Gopal
|
|
138.51
|
|
|
*
|
|
Diane Bono
|
|
0.00
|
|
|
*
|
|
Sean Wickliffe
|
|
0.00
|
|
|
*
|
Based upon the Fund’s records and upon information provided to the Fund by its directors, executive officers and affiliates (as such term is used in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), neither the Fund nor, to the best of the Fund’s knowledge, any of the directors or executive officers of the Fund, nor any associates (as such term is used in Rule 12b-2 under the Exchange Act) of any of the foregoing, has effected any transactions in Shares during the sixty business day period prior to the date hereof (excluding automatic dividend reinvestment plan transactions).
Except as set forth in this Offer to Purchase, neither the Fund nor, to the best of the Fund’s knowledge, any of its affiliates, directors or executive officers, is a party to any contract, arrangement, understanding or relationship with any other person relating, directly or indirectly, to the Offer with respect to any Shares (including, but not limited to, any contract, arrangement, understanding or relationship concerning the transfer or the voting of any Shares, joint ventures, loan or option arrangements, puts or calls, guaranties of loans, guaranties against loss or the giving or withholding of proxies, consents or authorizations). The Fund will not purchase any securities from any officer, director, or affiliate of the Fund pursuant to this Offer to Purchase.
Tortoise Capital Advisors, L.L.C. serves as Investment Manager (the “Advisor”) to the Fund pursuant to an investment management agreement. Under the investment management agreement, the Advisor provides investment advisory services to the Fund for an annual fee in an amount equal to 1.10% of the average monthly “Managed Assets” of the Company. “Managed Assets” means the total assets of the Company (including any assets attributable to any leverage that may be outstanding but excluding any net deferred tax assets) minus the sum of accrued liabilities (other than net deferred tax liabilities, debt representing financial leverage and the aggregate liquidation preference of any outstanding preferred shares).
The Fund also is a party to certain other service agreements. The Fund is a party to a Fund Accounting Servicing Agreement with U.S. Bancorp Fund Services, LLC d/b/a U.S. Bank Global Fund Services (“USBFS”) under which USBFS provides fund accounting services to the Fund. The Fund is a party to a Fund Administration Servicing Agreement with USBFS under which USBFS provides administration services to the Fund. U.S. Bank, N.A. serves as custodian for the Fund’s portfolio securities pursuant to the Custody Agreement entered into with the Fund. The Fund is a party to a transfer agency agreement with Computershare, pursuant to which Computershare acts as transfer agent, dividend disbursing agent and registrar for the Fund. The Fund has entered into a Credit Agreement with The Bank
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of Nova Scotia pursuant to which the Fund may borrow money from The Bank of Nova Scotia. The amounts paid by the Fund under these service agreements are disclosed in the Fund’s financial statements, which can be found in the Fund’s annual and semiannual reports.
12. Certain Fees and Expenses. The Fund will not pay to any broker or dealer, commercial bank, trust company or other person any solicitation fee for any Shares purchased pursuant to the Offer. The Fund will reimburse such persons for customary handling and mailing expenses incurred in forwarding the Offer. No such broker, dealer, commercial bank or trust company has been authorized to act as the agent of the Fund or the Depositary for purposes of the Offer.
The Fund has retained Computershare to act as Depositary and Georgeson LLC to act as Information Agent. The Depositary and the Information Agent will each receive reasonable and customary compensation for their services and will also be reimbursed for certain out-of-pocket expenses and indemnified against certain liabilities.
13. Miscellaneous. The Offer is not being made to, nor will the Fund accept tenders from, holders of Shares in any state or other jurisdiction in which the Offer would not be in compliance with the securities or Blue Sky laws of such jurisdiction.
The Fund is subject to the information and reporting requirements of the 1940 Act and in accordance therewith is obligated to file reports and other information with the U.S. Securities and Exchange Commission (the “Commission”) relating to its business, financial condition and other matters. The Fund has also filed an Issuer Tender Offer Statement on Schedule TO with the Commission. Such reports and other information are available free of charge on the Commission’s website (sec.gov) or through the Fund’s web site at cef.tortoiseecofin.com.
14. Extension of Tender Period; Termination; Amendments. The Fund reserves the right, at any time and from time to time, to extend the period of time during which the Offer is pending by making a public announcement thereof. In the event that the Fund so elects to extend the tender period, the NAV for the Shares tendered will be computed as of the close of ordinary trading on the NYSE on the Expiration Date, as extended. During any such extension, all Shares previously tendered and not purchased or withdrawn will remain subject to the Offer. The Fund also reserves the right, at any time and from time to time up to and including the Expiration Date, to (a) terminate the Offer and not to purchase or pay for any Shares or, subject to applicable law, postpone payment for Shares upon the occurrence of any of the conditions specified in Section 8, “Certain Conditions of the Offer”; and (b) amend the Offer in any respect by making a public announcement thereof. Such public announcement will be issued no later than 9:00 a.m. New York City time not later than the next business day after the previously scheduled Expiration Date and will disclose the approximate number of Shares tendered as of that date. Without limiting the manner in which the Fund may choose to make a public announcement of extension, termination or amendment, except as provided by applicable law (including Rule 13e-4(d)(2), Rule 13e-4(e)(3), and Rule 14e-1(d) under the Exchange Act), the Fund shall have no obligation to publish, advertise or otherwise communicate any such public announcement.
If the Fund materially changes the terms of the Offer or the information concerning the Offer, or if it waives a material condition of the Offer, the Fund will extend the Offer to the extent required by Rules 13e-4(d)(2) and 13e-4(e)(3) under the Exchange Act. These rules require that the minimum period during which an offer must remain open following material changes in the terms of the offer or information concerning the offer (other than a change in price or a change in percentage of securities sought) will depend on the facts and circumstances, including the relative materiality of such terms or information. If (i) the Fund increases or decreases the price to be paid for Shares, or the Fund increases or decreases the number of Shares being sought and (ii) the Expiration Date is less than ten business days away, then the Expiration Date will be extended at least ten business days from the date of the notice.
15. Certain Federal Income Tax Consequences. The following discussion describes certain U.S. federal income tax consequences of tendering Shares in the Offer. Except where noted, it deals only with Shares held as capital assets and does not deal with Stockholders subject to special treatment under the U.S. federal income tax laws, such as dealers in securities or commodities, traders in securities that elect to mark their holdings to market, insurance companies, financial institutions, tax- exempt entities, regulated investment companies, real estate investment trusts, partnerships or other pass through entities, U.S. expatriates, persons liable for the alternative minimum tax, persons holding Shares as a part of a hedging, conversion or constructive sale transaction or a straddle or U.S. Stockholders (as defined below) whose functional currency is not the U.S. dollar. Furthermore, the discussion below is based upon the provisions of the Internal Revenue Code of 1986, as amended (the “Code”), and regulations, rulings and judicial decisions thereunder as of the date hereof, and such authorities may be repealed, revoked or modified, possibly
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with retroactive effect, so as to result in U.S. federal income tax consequences different from those discussed below. Stockholders should consult their own tax advisors concerning the U.S. federal income tax consequences of participating in the Offer in light of their particular situations as well as any consequences arising under the laws of any other taxing jurisdiction.
As used herein, a U.S. Stockholder means a Stockholder that is for U.S. federal income tax purposes (i) an individual citizen or resident of the United States, (ii) a corporation (or any other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any State thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source or (iv) a trust if it (x) is subject to the primary supervision of a court within the United States and one or more U.S. persons have the authority to control all substantial decisions of the trust or (y) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person. A “Non-U.S. Stockholder” is a Stockholder (other than a partnership) that is not a U.S. Stockholder.
An exchange of Shares for cash in the Offer by U.S. Stockholders will be a taxable transaction for U.S. federal income tax purposes. As a consequence of the exchange, the U.S. Stockholder will, depending on such U.S. Stockholder’s particular circumstances, be treated either as recognizing gain or loss from the disposition of the Shares or as receiving a dividend distribution from the Fund. Under Section 302(b) of the Code, a sale of Shares pursuant to the Offer generally will be treated as a sale or exchange if the receipt of cash by the Stockholder: (a) results in a complete termination of the Stockholder’s interest in the Fund, (b) results in a substantially disproportionate redemption with respect to the Stockholder, or (c) is not essentially equivalent to a dividend with respect to the Stockholder. In determining whether any of these tests has been met, Shares actually owned, as well as Shares considered to be owned by the Stockholder by reason of certain constructive ownership rules set forth in Section 318 of the Code, generally must be taken into account. If any of these three tests for sale or exchange treatment is met, a U.S. Stockholder will recognize gain or loss equal to the difference between the price paid by the Fund for the Shares purchased in the Offer and the Stockholder’s adjusted basis in such Shares. If such Shares are held as a capital asset, the gain or loss will be capital gain or loss and will be long-term capital gain or loss if the Shares have been held for more than one year. If, however, a U.S. Stockholder has held Shares for six months or less, any loss recognized upon the exchange will be treated as a long-term capital loss to the extent of any capital gain dividends received (or amounts credited as undistributed capital gains) with respect to such Shares. The maximum tax rate applicable to net capital gains recognized by individuals and other non-corporate taxpayers is currently (i) the same as the applicable ordinary income rate for capital assets held for one year or less (i.e., short-term capital gains) or (ii) 0%, 15% or 20% for capital assets held for more than one year (i.e., long-term capital gains), depending on taxable income and filing status.
If the requirements of Section 302(b) of the Code are not met, amounts received by a U.S. Stockholder who sells Shares pursuant to the Offer will be taxable to the U.S. Stockholder as a dividend to the extent of such U.S. Stockholder’s allocable share of the Fund’s current or accumulated earnings and profits. To the extent that amounts received exceed such U.S. Stockholder’s allocable share of the Fund’s current and accumulated earnings and profits for a taxable year, the distribution will first be treated as a non-taxable return of capital, causing a reduction in the adjusted basis of such U.S. Stockholder’s Shares, and any amounts in excess of the U.S. Stockholder’s adjusted basis will constitute taxable gain. Any remaining adjusted basis in the Shares tendered to the Fund will be transferred to any remaining Shares held by such U.S. Stockholder.
If the payment for any purchase of Shares pursuant to the Offer is treated as a taxable dividend to the selling Stockholder rather than as an exchange, the other Stockholders, including the non-tendering Stockholders, could be deemed to have received taxable stock distributions under certain circumstances. Stockholders are urged to consult their own tax advisors regarding the possibility of deemed distributions resulting from the purchase of Shares pursuant to the Offer.
Non-U.S. Stockholders. The Depositary will withhold U.S. federal income taxes equal to 30% of the gross payments payable to a Non-U.S. Stockholder or his or her agent for any Shares purchased pursuant to the Offer unless the Depositary determines that a reduced rate of withholding is available pursuant to a tax treaty or that an exemption from withholding is applicable because such gross proceeds are effectively connected with the conduct of a trade or business within the United States. In order to obtain a reduced rate of withholding pursuant to a tax treaty, a Non-U.S. Stockholder must deliver to the Depositary before the payment a properly completed and executed Internal Revenue Service (“IRS”) Form W-8BEN. In order to obtain an exemption from withholding on the grounds that the gross proceeds paid pursuant to the Offer are effectively connected with the conduct of a trade or business within
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the United States, a Non-U.S. Stockholder must deliver to the Depositary before the payment a properly completed and executed IRS Form W-8ECI. The Depositary will determine a shareowner’s status as a Non-U.S. Stockholder and eligibility for a reduced rate of, or exemption from, withholding by reference to any outstanding certificates or statements concerning eligibility for a reduced rate of, or exemption from, withholding (e.g., IRS Forms W-8BEN or W-8ECI) unless facts and circumstances indicate that such reliance is not warranted. A Non-U.S. Stock- holder may be eligible to obtain a refund of all or a portion of any tax withheld if such shareowner meets the “complete termination,” “substantially disproportionate” or “not essentially equivalent to a dividend” test described above or is otherwise able to establish that no tax or a reduced amount of tax is due. Backup withholding generally will not apply to amounts subject to the 30% or a treaty-reduced rate of withholding. Non-U.S. Stockholders are urged to consult their own tax advisors regarding the application of federal income tax withholding, including eligibility for a withholding tax reduction or exemption, and the refund procedure.
Backup Withholding. See Section 11 of the Letter of Transmittal with respect to the application of backup withholding on payments made to Stockholders.
The tax discussion set forth above is included for general information only. Each shareowner is urged to consult such owner’s own tax advisor to determine the particular tax consequences to him or her of the Offer, including the applicability and effect of state, local and foreign tax laws.
* * * * *
Questions, requests for assistance and requests for additional copies of this Offer to Purchase and related materials should be directed to Georgeson LLC toll free at 1-866-432-2791.
Tortoise Energy Independence Fund, Inc.
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The Letter of Transmittal and certificates for your Shares should be sent by you, your broker, dealer, commercial bank or trust company to the Depositary as set forth below.
The Depositary for the Offer to Purchase is:
COMPUTERSHARE INC. AND COMPUTERSHARE
TRUST COMPANY, N.A.
|
By First Class Mail:
|
|
By Registered, Certified,
Express Mail
or Overnight Courier:
|
|
Computershare Shareholder Services, Inc.
|
|
Computershare Shareholder Services, Inc.
|
|
Attn: Voluntary Corporate Actions
|
|
Attn: Voluntary Corporate Actions Suite V
|
|
P.O. Box 43011
|
|
150 Royall Street
|
|
Providence, RI 02940-3011
|
|
Canton, MA 02021
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Any questions or requests for assistance or additional copies of the Offer to Purchase, the Letter of Transmittal, the Notice of Guaranteed Delivery and other documents may be directed to the Information Agent at its telephone number and location listed below. Stockholders may also contact their broker, dealer, commercial bank or trust company or other nominee for assistance concerning the Offer.
The Information Agent for the Offer to Purchase is:
GEORGESON LLC
1290 Avenue of the Americas, 9th Floor,
New York, NY 10104
1-866-432-2791
11
Exhibit (b)(1)(iv)
Execution Version
AMENDMENT NO. 3 TO CREDIT AGREEMENT
AMENDMENT NO. 3, dated as of December 28, 2022 (this “Amendment”), to the Credit Agreement, dated as of June 2, 2016, between Tortoise Energy Independence Fund, Inc., a Maryland corporation (the “Borrower”), and The Bank of Nova Scotia (the “Bank), as amended by Amendment No. 1, dated as of December 1, 2017, and Amendment No. 2, dated as of December 29, 2021 (the “Existing Credit Agreement”).
RECITALS
I. Each term that is defined in the Existing Credit Agreement and not herein defined has the meaning ascribed thereto by the Existing Credit Agreement when used herein.
II. The Borrower desires to amend the Existing Credit Agreement upon the terms and conditions herein contained, and the Bank has agreed thereto upon the terms and conditions herein contained.
AGREEMENTS
Accordingly, in consideration of the Recitals and the covenants, conditions and agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:
1. Defined Terms. For purposes hereof, the following terms have the following meanings when used herein:
“Added Text” means characters indicated textually in the same manner as the following example: double underlined text.
“Marked Credit Agreement” means the copy of the Existing Credit Agreement attached hereto as Annex A.
“Stricken Text” means characters indicated textually in the same manner as the following example: stricken text.
2. The Existing Credit Agreement (other than the Exhibits thereto) is hereby amended to delete the Stricken Text and to add the Added Text, in each case as set forth in the Marked Credit Agreement (the Existing Credit Agreement, as so amended, the “Amended Credit Agreement”).
3. Exhibit C-1 of the Existing Credit Agreement is hereby amended and restated in its entirety in the form of Exhibit C hereof.
4. Exhibit C-2 of the Existing Credit Agreement is hereby deleted in its entirety.
5. Paragraphs 1 through 4 of this Amendment shall not be effective until each of the following conditions is satisfied (the date, if any, on which such conditions shall have first been satisfied being referred to herein as the “Amendment Effective Date”):
(a) the Bank shall have received from the Borrower either (i) a counterpart of this Amendment executed on behalf of the Borrower or (ii) written evidence satisfactory to the Bank (which may include telecopy transmission of a signed signature page of this Amendment) that the Borrower has executed a counterpart of this Amendment;
(b) the Bank shall have received a certificate of the Secretary or Assistant Secretary of the Borrower, dated the Amendment Effective Date, in form and substance reasonably satisfactory to the Bank (i) certifying that the Borrower’s Organization Documents have not been amended, supplemented or modified since December 29, 2021, or if so, attaching a true, correct and complete copy of each amendment, supplement or modification thereof, (ii) certifying as to the incumbency of the Borrower’s officer or officers who may sign this Amendment, including therein a signature specimen of such officer or officers, and (iii) attaching true, complete
1
and correct copies of the resolutions duly adopted by the Board approving this Amendment and the transactions contemplated hereby, all of which are in full force and effect on the Amendment Effective Date;
(c) the Bank shall have received a favorable written opinion (addressed to the Bank and dated the Amendment Effective Date) from external legal counsel to the Borrower in all respects acceptable to the Bank;
(d) the Bank shall have received a new Federal Reserve Form U-1 from the Borrower, in form and substance satisfactory to the Bank;
(e) the Bank shall have received such documents and information as the Bank shall have requested in order to comply with “know-your-customer” and other anti-terrorism, anti-money laundering and similar rules and regulations and related policies; and
(f) the Borrower shall have paid all reasonable and documented out-of-pocket fees and disbursements incurred by the Bank (including, without limitation, legal fees and disbursements of counsel to the Bank) in connection herewith.
6. The Borrower (a) reaffirms and admits the validity and enforceability of each Loan Document to which it is a party and all of its obligations thereunder and agrees and admits that (i) it has no defense to any such obligation and (ii) it shall not exercise any setoff or offset to any such obligation, and (b)(1) represents and warrants that, as of the date of execution and delivery hereof by the Borrower, no Default has occurred and is continuing and (2) the representations and warranties of the Borrower contained in the Amended Credit Agreement and the other Loan Documents are true on and as of the date hereof with the same force and effect as if made on and as of such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date).
7. In all other respects, the Loan Documents shall remain in full force and effect, and no amendment in respect of any term or condition of any Loan Document shall be deemed to be an amendment in respect of any other term or condition contained in any Loan Document.
8. This Amendment may be executed in any number of counterparts, each of which shall constitute an original but all of which when taken together shall constitute a single contract. It shall not be necessary in making proof of this Amendment to produce or account for more than one counterpart signed by the party to be charged.
9. Delivery of an executed counterpart of a signature page of this Amendment by telecopy, emailed .pdf or any other electronic means that reproduces an image of the actual executed signature page shall be effective as delivery of a manually executed counterpart of this Amendment. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to any document to be signed in connection with this Amendment and the transactions contemplated hereby shall be deemed to include Electronic Signatures, deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that nothing herein shall require the Bank to accept electronic signatures in any form or format without its prior written consent. Without limiting the generality of the foregoing, the Borrower hereby (i) agrees that, for all purposes, including without limitation, in connection with any workout, restructuring, enforcement of remedies, bankruptcy proceedings or litigation between the Bank and the Borrower, electronic images of this Amendment (including with respect to any signature pages thereto) shall have the same legal effect, validity and enforceability as any paper original, and (ii) waives any argument, defense or right to contest the validity or enforceability of the Loan Documents based solely on the lack of paper original copies of any Loan Documents, including with respect to any signature pages thereto. For purposes hereof, “Electronic Signature” means an electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or record.
10. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.
[the remainder of this page has been intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.
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TORTOISE ENERGY INDEPENDENCE FUND, INC.
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By:
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Name:
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P. Bradley Adams
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Title:
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Chief Executive Officer
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Tortoise Energy Independence Fund, Inc. (NDP) — Amendment No. 3 to Credit Agreement
3
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THE BANK OF NOVA SCOTIA
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By:
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Name:
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Aron Lau
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Title:
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Director
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Tortoise Energy Independence Fund, Inc. (NDP) — Amendment No. 3 to Credit Agreement
4
ANNEX A
CREDIT AGREEMENT
dated as of June 2, 2016
between
TORTOISE ENERGY INDEPENDENCE FUND, INC.
and
THE BANK OF NOVA SCOTIA
Prepared by:
Bryan Cave Leighton Paisner LLP
1290 Avenue of the Americas
New York, New York 10104-3300
TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS
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1
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1.1
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Defined Terms
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1
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1.2
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Terms Generally
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17
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1.3
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Accounting Terms
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17
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1.4
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Non-Recourse Persons
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17
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1.5
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Rates; Conforming Changes
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18
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ARTICLE II THE CREDITS
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18
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2.1
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Commitment
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18
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2.2
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Variable Rate Loans
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18
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2.3
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Fixed Rate Loans [Reserved.]
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19
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2.4
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Termination and Reduction of Commitment
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20
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2.5
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Repayment of Loans
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20
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2.6
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Voluntary Prepayments
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20
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2.7
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Payments Generally
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20
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2.8
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Evidence of Debt
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21
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2.9
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[Reserved.]
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21
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ARTICLE III INTEREST, FEES, YIELD PROTECTION, ETC.
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21
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3.1
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Interest
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21
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3.2
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Fees
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21
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3.3
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Increased Costs
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21
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3.4
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Taxes
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22
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3.5
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Alternate Rate of Interest
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24
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3.6
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Other LIBOR Provisions Illegality
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26
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3.7
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Break Funding Payments
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26
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3.8
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Inability to Determine Rates
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27
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ARTICLE IV REPRESENTATIONS AND WARRANTIES
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28
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4.1
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Organization and Power
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28
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4.2
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Authority and Execution
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28
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4.3
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Binding Agreement
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28
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4.4
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Litigation
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28
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4.5
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Approvals and Consents
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28
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4.6
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No Conflict
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28
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4.7
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Taxes
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29
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4.8
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Compliance
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29
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4.9
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Property
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29
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4.10
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Federal Reserve Regulations; Use of Loan Proceeds
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29
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4.11
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No Material Adverse Effect
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29
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4.12
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Material Agreements
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29
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4.13
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Financial Condition
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29
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4.14
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No Misrepresentation
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29
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4.15
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Sanctions, Etc.
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30
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4.16
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Investment Company Status
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30
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4.17
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ERISA
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31
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ARTICLE V CONDITIONS
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31
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5.1
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Effective Date
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31
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5.2
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Each Credit Event
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32
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i
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Page
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ARTICLE VI AFFIRMATIVE COVENANTS
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32
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6.1
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Financial Statements and Other Information
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32
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6.2
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Notice of Material Events
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33
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6.3
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Legal Existence
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33
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6.4
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Insurance
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33
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6.5
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Payment of Indebtedness and Performance of Obligations
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34
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6.6
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Observance of Legal Requirements
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34
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6.7
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Books and Records; Visitation
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34
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6.8
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Purpose of Loans
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34
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6.9
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Maintenance of Status
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34
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ARTICLE VII NEGATIVE COVENANTS
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34
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7.1
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Indebtedness; Senior Securities
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34
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7.2
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Liens
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35
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7.3
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Fundamental Changes
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35
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7.4
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Restricted Payments
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35
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7.5
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Fundamental Policies; Valuation
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35
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7.6
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Amendments and Changes
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36
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7.7
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Financial Covenants
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36
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7.8
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Investment
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36
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7.9
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Sanctions, Etc.
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36
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ARTICLE VIII EVENTS OF DEFAULT
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37
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8.1
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Events of Default
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37
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8.2
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Remedies
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38
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ARTICLE IX MISCELLANEOUS
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39
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9.1
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Notices
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39
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9.2
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Waivers; Amendments
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39
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9.3
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Expenses; Indemnity; Damage Waiver
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39
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9.4
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Successors and Assigns
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40
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9.5
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Survival
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40
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9.6
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Counterparts; Integration; Effectiveness
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40
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9.7
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Severability
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41
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9.8
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Right of Setoff
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41
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9.9
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Governing Law; Jurisdiction; Consent to Service of Process
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41
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9.10
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WAIVER OF JURY TRIAL
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42
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9.11
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Headings
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42
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9.12
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Interest Rate Limitation
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42
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9.13
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Treatment of Certain Information
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42
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9.14
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USA Patriot Act Notice
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43
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9.15
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Acknowledgement Regarding any Supported QFCs
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43
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EXHIBITS:
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Exhibit A
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Form of Note
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Exhibit B
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Outline of Opinion of Counsel to the Borrower
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Exhibit C-1
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Form of Written Variable Borrowing Request
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Exhibit C-2
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Form of Written Fixed Borrowing Request
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Exhibit D
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Form of Closing Certificate
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Exhibit E
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Form of Federal Reserve Form FR U-1
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Exhibit F
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Form of Compliance Certificate
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Exhibit G
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Form of Security Agreement
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Exhibit H
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Form of Control Agreement
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ii
CREDIT AGREEMENT, dated as of June 2, 2016 between Tortoise Energy Independence Fund, Inc., a Maryland corporation and The Bank of Nova Scotia.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Defined Terms
As used in this Credit Agreement, the following terms have the meanings specified below:
“ABR Loan” means a Loan (or any portion thereof) bearing interest based on the Alternate Base Rate.
“Adjusted Asset Coverage” means, as of any date, the ratio on such date of (a) Adjusted Total Net Assets to (b) the greater of (i) Adjusted Senior Debt, and (ii) one Dollar ($1).
“Adjusted Daily Simple SOFR” means, for any day, a rate per annum equal to the greater of (a) the sum of (i) Daily Simple SOFR for such day plus (ii) the SOFR Adjustment, and (b) the Floor.
“Adjusted LIBO Rate” means, with respect to any LIBOR Loan for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.
“Adjusted Senior Debt” means, as of any date, the sum (without duplication) of each of the following on such date: (a) all Senior Debt plus (b) all Financial Contract Liabilities, plus (c) all Secured Liabilities, plus (d) all Segregated Liabilities.
“Adjusted Term SOFR” means, for purposes of any calculation, the rate per annum equal to (a) Term SOFR for such calculation plus (b) the SOFR Adjustment; provided that if Adjusted Term SOFR as so determined shall ever be less than the Floor, then Adjusted Term SOFR shall be deemed to be the Floor.
“Adjusted Total Net Assets” means, as of any date (a) Total Net Assets, minus (b) the sum (without duplication) of the following: (i) the value of all Excluded Assets (but not less than zero), plus (ii) the value of all Excluded Investments (but not less than zero), plus (iii) the excess, if any, of (1) the value of all of the Borrower’s assets (other than Excluded Assets) that are subject to any Lien (other than an Ordinary Course Lien), that are segregated, or that are on deposit to satisfy margin requirements, minus (2) the sum of all Secured Liabilities (excluding, to the extent otherwise included therein, liabilities of the Borrower under the Loan Documents) and all Segregated Liabilities.
“Affected Person” means the Borrower, any subsidiary thereof, or any officer, director, Affiliate (other than another portfolio company of the Investment Adviser) or, to the Borrower’s knowledge, any employee of the Borrower or any such subsidiary, or any agent of the Borrower or any such subsidiary that will act in any capacity with respect to this Credit Agreement.
“Affiliate” of a Person means (a) any other Person directly or indirectly owning, controlling, or holding with power to vote, greater than 50% of the outstanding voting securities of such Person, (b) any other Person greater than 50% of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by such Person, or (c) any Person directly or indirectly controlling, controlled by, or under common control with, such other Person. For purposes of this defined term, “control” means the power to exercise a controlling influence over the management or policies of a company, and “controlling” and “controlled” shall have correlative meanings.
“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) 2.0% plus the Federal Funds Effective Rate in effect on such day, or (c) 2.0% plus the Overnight Eurodollar RateAdjusted Daily Simple SOFR in effect on such day. Any change in the Alternate Base Rate due to a change in the Federal Funds Effective Rate, the Overnight Eurodollar RateAdjusted Daily Simple SOFR or the Prime Rate, shall be effective from and including the effective date of such change in the Federal Funds Effective Rate, the Overnight Eurodollar RateAdjusted Daily Simple SOFR or the Prime Rate, as applicable.
1
“Amendment No. 1 Effective Date” means the “Amendment Effective Date”, as defined by Amendment No. 1 to this Credit Agreement.
“Amendment No. 2 Effective Date” means the “Amendment Effective Date”, as defined by Amendment No. 23, dated as of December 2928, 20212022, to this Credit Agreement.
“Anti-Corruption Law” means, with respect to any Affected Person, the FCPA and any law, rule or regulation of any jurisdiction concerning or relating to bribery or corruption that are applicable to such Affected Person.
“Anti-Terrorism Law” means, with respect to any Person, any applicable law, rule or regulation related to financing terrorism including (a) the Patriot Act, (b) The Currency and Foreign Transactions Reporting Act (31 U.S.C. §§ 5311-5330) (also known as the “Bank Secrecy Act”), (c) the Trading With the Enemy Act (50 U.S.C. § 1 et seq.), (d) the International Economic Emergency Powers Act (15 U.S.C. § 1701 et seq.) and (e) Executive Order 13224 (effective September 24, 2001).
“Applicable Accounting Principles” means, with respect to the Borrower, those accounting principles required by the ICA and prescribed by the SEC for the Borrower and, to the extent not so required or prescribed, GAAP.
“Applicable Margin” means (a) prior to the Amendment No. 2 Effective Date, with respect to each Loan, the interest rate per annum set forth from time to time in margin applicable to such Loan under this Credit Agreement as the applicable margin applicable to the interest rate at which such Loan accrued interest under the Loan Documents and (b) on and after the Amendment No. 2 Effective Date, a rate per annum equal to (i) with respect to each ABR Loan, 0.00%, and (ii) with respect to each Fixed Rate Loan, each LIBORTS Loan and each Overnight Loan, 1.101.25%.
“Applicable Money Market” means the London interbank market applicable to LIBOR Loans.
“Applicable Rate” means, with respect to each (a) ABR Loan, the Alternate Base Rate plus the Applicable Margin, (b) Fixed RateTS Loan, the Fixed Rate thereforAdjusted Term SOFR plus the Applicable Margin, (c) Existing LIBOR Loan, the Adjusted LIBO Rate plus the Applicable Margin, and (d) Overnight Loan, the One-month Eurodollar RateAdjusted Term SOFR plus the Applicable Margin.
“Approved Amount” means (a) in connection with any borrowing, conversion, continuation or prepayment of a LIBORTS Loan, $1,000,000 or an integral multiple of $1,000,000 in excess thereof, or (b) in connection with any borrowing of, or conversion into, a Fixed Rate Loan, $5,000,000 or an integral multiple of $1,000,000 in excess thereof, or (c) in connection with any borrowing or prepayment of any other Loan, $1,000,000 or an integral multiple of $1,000,000 in excess thereof.
“Asset-backed Security” means a type of bond or note that is based on one or more pools of assets, or collateralized by the cash flows from one or more pools of underlying assets, and includes collateralized bond obligations, collateralized loan obligations, collateralized mortgage obligations, and credit linked notes.
“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if the then-currentsuch Benchmark is a term rate, any tenor for such Benchmark (or component thereof) that is or may be used for determining the length of an Interest Period interest period pursuant to this Credit Agreement or (y) otherwise, any payment period for interest calculated with reference to such Benchmark, as applicable, (or component thereof) that is or may be used for determining any frequency of making payments of interest calculated with reference to such Benchmark pursuant to this Credit Agreement, in each case, as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to Section 3.5(d).
“Bank” means The Bank of Nova Scotia.
“Bank Loan” means a debt obligation customarily referred to as a “bank loan” other than (a) a security (as defined in the Securities Act), and (b) any participation or sub-participation in a debt obligation.
2
“Benchmark” means, initially, USD LIBORthe Term SOFR Reference Rate; provided that if a replacement of the Benchmark Transition Event has occurred pursuant to Section 3.5with respect to the Term SOFR Reference Rate or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate. Any reference to “Benchmark” shall include, as applicable, the published component used in the calculation thereof pursuant to Section 3.5(a).
“Benchmark Replacement” means, with respect to any Benchmark Transition Event, the first alternative set forth in the order below that can be determined by the Bank for the applicable Benchmark Replacement Date:
(a) Adjusted Daily Simple SOFR; or
“Benchmark Replacement means, for any Available Tenor:
(a) For purposes of Section 3.5(b)(i), the first alternative set forth below that can be determined by the Bank:
(i) the sum of: (i) Term SOFR and (ii) 0.11448% (11.448 basis points) for an Available Tenor of one-month’s duration, 0.26161% (26.161 basis points) for an Available Tenor of three-months’ duration, and 0.42826% (42.826 basis points) for an Available Tenor of six-months’ duration, or
(ii) the sum of: (i) Daily Simple SOFR and (ii) the spread adjustment selected or recommended by the Relevant Governmental Body for the replacement of the tenor of USD LIBOR with a SOFR-based rate having approximately the same length as the interest payment period specified in Section 3.5(b)(i); and
(b) For purposes of Section 3.5(b)(ii), the sum of: (ai) the alternate benchmark rate and (b) an adjustment (which may be a positive or negative value or zero), in each case, that has been by the Bank as the replacement for such Available Tenor of such Benchmark that has been selected by the Bank and the Borrower giving due consideration to (A) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (B) any evolving or then-prevailing market convention, including any applicable recommendations made by the Relevant Governmental Body, for U.S. for determining a benchmark rate as a replacement to the then-current Benchmark for Dollar-denominated syndicated or bilateral credit facilities at such time;and (ii) the related Benchmark Replacement Adjustment.
provided that, ifIf the Benchmark Replacement as determined pursuant to clause (1a) or (2b) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Credit Agreement and the other Loan Documents.
“Benchmark Replacement Conforming ChangesAdjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Alternate Base Rate,” the definition of “Business Day”, the definition of “Interest Period”, timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, applicability and length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that the Bank decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by the Bank in a manner substantially consistent with market practice (or, if the Bank decides that adoption of any portion of such market practice is not administratively feasible or determines that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as the Bank decides is reasonably necessary in connection with the administration of this Credit Agreement and the other Loan Documents).the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Bank and the Borrower giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for Dollar-denominated syndicated credit facilities at such time.
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“Benchmark Replacement Date” means a date and time determined by the Bank, which date shall be no later than the earliest to occur of the following events with respect to the then-current Benchmark:
(a) in the case of clause (a) or (b) of the definition of “Benchmark Transition Event,” the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof); or
(b) in the case of clause (c) of the definition of “Benchmark Transition Event,” the first date on which all Available Tenors of such Benchmark (or the published component used in the calculation thereof) have been determined and announced by the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be non-representative; provided that such non-representativeness will be determined by reference to the most recent statement or publication referenced in such clause (c) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date.
For the avoidance of doubt, the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (a) or (b) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:
(a) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);
(b) “Benchmark Transition Event” means, with respect to any then-current Benchmark other than USD LIBOR, the occurrence of a public statement or publication of information by or on behalf of the administrator of the then-current Benchmark, thethe regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Board of Governors, the Federal Reserve Bank of New YorkFRBNY, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark, announcing or stating that (a) such (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease on a specified date to provide all Available Tenors of such Benchmark, (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark or (b) all Available Tenors of such Benchmark are or will no longer be representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not be restored.(or such component thereof); or
(c) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are not, or as of a specified future date will not be, representative.
For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Unavailability Period” means the period (if any) (a) beginning at the time that a Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 3.5 and (b) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 3.5.
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“Benefit Arrangement” means at any time an employee benefit plan within the meaning of Section 3(3) of ERISA that is subject to ERISA and which is not a Plan or a Multiemployer Plan and which is maintained or otherwise contributed to by any member of an ERISA Group.
“Board” means the Borrower’s board of directors.
“Board of Governors” means the Board of Governors of the Federal Reserve System of the United States of America.
“Borrower” means Tortoise Energy Independence Fund, Inc., a Maryland corporation.
“Borrowing Request” means a request in accordance with Section 2.2 or Section 2.3 for a Loan or a conversion or continuation of a Loan and, if required in writing, in the form of Exhibit C-1 or C-2, as applicable.
“Breakage Event” has the meaning set forth in Section 3.7(b).
“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed, provided that, when used in connection with aan Existing LIBOR Loan or the determination of the One-month Eurodollar Rate or the Overnight Eurodollar Rate, the term “Business Day” shall also exclude any day on which banks are not open for dealings in Dollar deposits in the London interbank market.
“Change in Circumstance” means any Change in Law that shall (a) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, the Bank or (b) impose on the Bank or any Applicable Money Marketthe eurodollar market any other condition affecting this Credit Agreement or any Loan. A change in tax rates shall not be a “Change in Circumstances”.
“Change in Law” means (a) the adoption of any law, rule or regulation after the date hereof, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the date hereof or (c) compliance by the Bank (or, for purposes of Section 3.3(b), by any lending office of the Bank or by the Bank’s holding company) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date hereof; provided that for purposes of this Credit Agreement, the Dodd-Frank Wall Street Reform and Consumer Protection Act, all requests, rules, guidelines or directives in connection therewith and all requests, rules, guidelines or directives concerning capital adequacy promulgated by the Bank for International Settlements, the Basel Committee on Banking Regulations and Supervisory Practices (or any successor or similar authority) or the United States financial regulatory authorities, shall be deemed to have been adopted and become effective after the date hereof. A change in tax rates shall not be a “Change in Law”.
“Change of Control” means the occurrence of one or more of the following events on or after the Amendment No. 1 Effective Date: (a) the failure of the Investment Adviser to be an Affiliate of Lovell Minnick Partners LLC, a Delaware limited liability company (the “Parent”); (b) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions), including by way of merger or consolidation, of all or substantially all of the assets of the Investment Adviser or, together with any Affiliates thereof, the Parent to any Person or group of related Persons (other than another Affiliate of the Parent) for purposes of Section 13(d) of the Securities Exchange Act of 1934 (a “Group”); (c) the approval by the board of directors, board of trustees or other managing body of, or the holders of equity interests issued by, the Parent or the Investment Adviser of any plan or proposal for the liquidation or dissolution of the Parent or the Investment Adviser, as the case may be; or (d) any Person or Group shall become the owner, directly or indirectly, beneficially or of record, of shares representing more than 25% of the aggregate ordinary voting power represented by the equity interests issued by the Parent.
“Change in Law” means (a) the adoption of any law, rule or regulation after the date hereof, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the date hereof or (c) compliance by the Bank (or, for purposes of Section 3.3(b), by any lending office of the Bank or by the Bank’s holding company) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date hereof; provided that for purposes of this Credit Agreement, the Dodd-Frank Wall Street Reform and Consumer Protection Act, all requests, rules, guidelines or directives in
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connection therewith and all requests, rules, guidelines or directives concerning capital adequacy promulgated by the Bank for International Settlements, the Basel Committee on Banking Regulations and Supervisory Practices (or any successor or similar authority) or the United States financial regulatory authorities, shall be deemed to have been adopted and become effective after the date hereof. A change in tax rates shall not be a “Change in Law”.
“Code” means the Internal Revenue Code of 1986.
“Commitment” means, as of any date, the commitment of the Bank hereunder to make Loans to the Borrower in an aggregate principal amount not exceeding $80,000,00012,000,000 at any one time outstanding, as such commitment may be reduced from time to time pursuant to Section 2.4.
–“Commitment Fee Rate” means (a) prior to the Amendment No. 2 Effective Date, the rate per annum set forth from time to time in this Credit Agreement at which the commitment fee payable thereunderhereunder accrued, and (b) on and after the Amendment No. 2 Effective Date, a rate per annum equal to (i) as of any date upon which the Loan Balance equals or exceeds 75% of the Commitment, 0.15%, and (ii) as of any other date, 0.25%.
“Commitment Termination Date” means the earlier to occur of (a) the Scheduled Commitment Termination Date and (b) such earlier date on which the Bank’s obligations to make Loans shall have otherwise terminated or been terminated in accordance herewith.
“Conforming Changes” means, with respect to either the use or administration of Term SOFR or Daily Simple SOFR or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Alternate Base Rate,” the definition of “Business Day,” the definition of “U.S. Government Securities Business Day,” the definition of “Interest Period” or any similar or analogous definition (or the addition of a concept of “interest period”), timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, the applicability of Section 3.7 and other technical, administrative or operational matters) that the Bank decides may be appropriate to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by the Bank in a manner substantially consistent with market practice (or, if the Bank decides that adoption of any portion of such market practice is not administratively feasible or if the Bank determines that no market practice for the administration of any such rate exists, in such other manner of administration as the Bank decides is reasonably necessary in connection with the administration of this Credit Agreement and the other Loan Documents).
–“Control Agreement” has the meaning set forth in Section 5.1(g).
“Custodian” means U.S. Bank National Association, in its capacity as custodian under the Custody Agreement.
“Custody Agreement” means the Custody Agreement, dated as of July 6, 2012, by and between the Borrower and U.S. Bank National Association, in its capacity as custodian thereunder.
“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being established by the Bank in accordance with the conventions for this rate recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for bilateral business loans; provided, that if the Bank decides that any such convention is not administratively feasible for the Bank, then the Bank may establish another convention in its reasonable discretion. (a “SOFR Rate Day”), a rate per annum equal to the greater of (a) SOFR for the day (such day, a “SOFR Determination Day”) that is one (1) U.S. Government Securities Business Day prior to (i) if such SOFR Rate Day is a U.S. Government Securities Business Day, such SOFR Rate Day or (ii) if such SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such SOFR Rate Day, in each case, as such SOFR is published by the SOFR Administrator on the SOFR Administrator’s Website, and (b) the Floor. If by 5:00 p.m. (New York City time) on the second (2nd) U.S. Government Securities Business Day immediately following any SOFR Determination Day, SOFR in respect of such SOFR Determination Day has not been published on the SOFR Administrator’s Website, then SOFR for such SOFR Determination Day will be SOFR as published in respect of the first preceding U.S. Government Securities Business Day for which such SOFR was published on the SOFR Administrator’s Website; provided that any SOFR
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determined pursuant to this sentence shall be utilized for purposes of calculation of Daily Simple SOFR for no more than three (3) consecutive SOFR Rate Days. Any change in Daily Simple SOFR due to a change in SOFR shall be effective from and including the effective date of such change in SOFR without notice to the Borrower.
“Default” means any event or condition that constitutes an Event of Default or that upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.
“Delayed Settlement Loan Collateral” means, as of any date, any Investment of the Borrower in a Bank Loan with respect to which the Borrower has entered into a sale or trade and such sale or trade has not, (a) in the case of any Bank Loan trading on “par documents”, settled within fourteen (14) Business Days of the date of such sale or trade, or (b) in the case of any other Bank Loan, settled within twenty-one (21) Business Days of the date of such sale or trade.
“Dollars” or “$” refers to lawful money of the United States of America.
“Early Opt-in Effective Date” means, with respect to any Early Opt-in Election, the sixth (6th) Business Day after the date notice of such Early Opt-in Election is provided to the Borrower, so long as the Bank has not received, by 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Early Opt-in Election is provided to the Borrower, written notice of objection to such Early Opt-in Election from the Borrower.
“Early Opt-in Election” means the occurrence of:
(a) a notification by the Bank to the Borrower that at least five (5) currently outstanding U.S. Dollar-denominated syndicated or bilateral credit facilities at such time contain (as a result of amendment or as originally executed) a SOFR-based rate (including SOFR, a term SOFR or any other rate based upon SOFR) as a benchmark rate (and such credit facilities are identified in such notice and are publicly available for review), and
(b) (2) the joint election by the Bank and the Borrower to trigger a fallback from USD LIBOR.
“Effective Date” has the meaning set forth in Section 5.1.
“ERISA” means the Employee Retirement Income Security Act of 1974.
“ERISA Group” means, with respect to any Person, such Person and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with such Person, are treated as a single employer under Section 414 of the Code.
“Event of Default” has the meaning assigned to such term in Section 8.1.
“Excluded Assets” means, with respect to the Borrower, (a) all commercial tort claims, cooperative interests, goods, letter-of-credit rights and letters of credit, (b) all property other than Investments, (c) all deferred organizational and offering expenses, (d) all Investments that are in default (except to the extent that the Borrower is required or permitted to attribute a value thereto pursuant to the ICA, the rules thereunder and Applicable Accounting Principles) or determined to be worthless pursuant to any applicable policy of the Borrower, and (e) all property of the Borrower in which the Bank does not have a security interest that has been perfected in accordance with the terms of, and that has the requisite priority required by, the Security Agreement.
“Excluded Investments” means as of any date and with respect to each of the following Investments (other than Excluded Assets) of the Borrower:
(a) the excess, if any, of (i) the sum (without duplication) of (x) the aggregate Value of all Illiquid Investments, plus (y) the aggregate Value of all Level III Assets over (ii) an amount equal to 10% of Total Net Assets;
(b) the excess, if any, of (i) the Value of all Delayed Settlement Loan Collateral over (ii) an amount equal to 5% of Total Net Assets;
(c) the excess, if any, of (i) the Value of all Investments (other than (x) debt of the United States of America, and (y) shares in any Money Market Fund) in respect of which any single Person is the Issuer, over (ii) an amount equal to 7.5% of Total Net Assets;
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(d) after giving effect to paragraph (c) immediately above, the excess, if any, of (i) the Value of all Investments (other than (x) debt of the United States of America, and (y) shares in any Money Market Fund) in respect of which any single Person (other than, at any time, up to three (3) Persons) is the Issuer, over (ii) an amount equal to 5.0% of Total Net Assets;
(e) the aggregate Value of (i) all Private Label Asset-backed Securities that are not rated BBB- or higher by S&P or Baa3 or higher by Moody’s, (ii) all collateralized debt obligations, and (iii) all collateralized loan obligations;
(f) the excess, if any, of the aggregate Value of (i) all Private Label Asset-backed Securities that are rated BBB- or higher by S&P or Baa3 or higher by Moody’s, over (ii) an amount equal to 15% of Total Net Assets;
(g) the aggregate Value of all Investments of the Borrower in any equity security (other than shares in any Money Market Fund) that is not traded on a recognized national securities exchange;
(h) the aggregate Value of all Investments of the Borrower in sovereign debt of any Restricted Nation or any political subdivision thereof;
(i) the excess, if any, of (i) the aggregate Value of all Investments of the Borrower with respect to all Persons organized under the laws of any single Limited Nation, over (ii) an amount equal to 15% of Total Net Assets; and
(j) the excess, if any, of (i) the aggregate Value of all Investments of the Borrower denominated in the official currency (other than Euros) of any single Limited Nation, over (ii) an amount equal to 15% of Total Net Assets.
“Existing LIBOR Loan” means each LIBOR Loan outstanding immediately prior to the Amendment Effective Date.
“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Credit Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof (provided such regulations or official interpretations are substantively comparable and not materially more onerous to comply with).
“FCPA” means the Foreign Corrupt Practices Act, 15 U.S.C. §§ 78dd-1, et seq.
“Fed Funds Business Day” shall mean any day upon which overnight federal funds transactions are conducted.
“Federal Funds Effective Rate” means, for any day (a “Fed Funds Rate Day”), a rate per annum (expressed as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%) equal to the higher of (i) 0.0% and (ii) the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that (a) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Effective Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the Business Day succeeding such next preceding Business Day, and (b) if such rate is not so published for any day, the Federal Funds Effective Rate for such day shall be the average of the quotations for such day on such transactions received by the Bankequal to the greater of (a) the “effective federal funds rate” for the Fed Funds Business Day immediately preceding such Fed Funds Rate Day, as published by the FRBNY, and (b) the Floor.
“Federal Reserve Form” means a Form FR U-1 duly completed by the Bank and executed by the Borrower, the statements made in which shall, in the reasonable opinion of the Bank, permit the transactions contemplated hereby in compliance with Regulation U, together with all instruments, certificates and other documents executed or delivered in connection therewith or attached thereto.
“Financial Contract” means (a) any rate, basis, commodity, currency, debt, equity or other swap or swaption, (b) any put, cap, collar or floor agreement, (c) any rate, basis, commodity, currency, debt, equity or other futures or forward agreement, (d) any rate, basis, commodity, currency, debt, equity or other option, (e) any derivative, (f) any financial instrument whose value is derived from the value of something else, (g) any contract under which
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the parties agree to payments between or among them based upon the value of an underlying asset or other data at a particular point or points in time, (h) any “swap agreement” within the meaning of Section 101(53B) of the Bankruptcy Code of the United States, (i) any foreign currency contract, repurchase agreement, reverse repurchase agreement, dollar roll, credit-linked note, indexed security, collateralized debt obligation, firm or standby commitment agreement, securities lending agreement, or when-issued contract, and (j) any other similar arrangement.
“Financial Contract Liability” means, as of any date and with respect to each Financial Contract, the liability of the Borrower in respect of such Financial Contract determined on a mark-to-market basis, provided that if for purposes of financial reporting such liability or other obligation is required to be reported by the Borrower on a notional basis, then such liability will be the notional amount of such Financial Contract.
“Fixed Period” has the meaning set forth in Section 2.3(a).
“Fixed Rate” means, with respect to a Fixed Rate Loan, the fixed rate of interest applicable to such Fixed Rate Loan as pursuant to Section 2.3(a).
“Fixed Rate Breakage Amount” means, with respect to any Breakage Event with respect to a Fixed Rate Loan, an amount equal to such amount as may be reasonably determined by the Bank (and the Bank agrees to endeavor to consult with the Borrower in making such determination), to be (a) the gain, if any, to the Bank arising out of such Breakage Event, determined as of the date thereof, minus (b) the positive sum, if any, of all loss, cost and expense to the Bank (other than any such loss, cost or expense relating to the loss of the anticipated Applicable Margin relating to such Fixed Rate Loan) arising out of such Breakage Event, determined as of the date thereof.
“Fixed Rate Loan” means any Loan bearing interest based on a Fixed Ratean Existing LIBOR Loan or a TS Loan.
“Floating Rate Loan” means an ABR Loan or an Overnight Loan.
“Floor” means the benchmark rate floor, if any, provided in this Credit Agreement initially (as of the execution of this Credit Agreement, the modification, amendment or renewal of this Credit Agreement or otherwise) with respect to USD LIBOR.a rate of interest equal to 0.0%.
“Foreign Lender” means, in the event the Bank is not a “United States person” within the meaning of Section 7701(a)(30) of the Code, the Bank.
“FRBNY” shall mean the Federal Reserve Bank of New York, or any successor thereto that publishes the Federal Funds Effective Rate.
“Fundamental Policies” means, collectively, (i) the policies and objectives for, and limits and restrictions on, investing by the Borrower set forth in its Offering Document as in effect on the Effective Date and which may be changed only by a vote of a majority of the Borrower’s outstanding voting securities (as defined in Section 2(a)(42) of the ICA), and (ii) all policies limiting the incurrence of Indebtedness by the Borrower set forth in its Offering Document as in effect on the Effective Date.
“GAAP” means generally accepted accounting principles in the United States of America.
“Governmental Authority” means the government of the United States of America or any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, arbitrator, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
“GSE” means the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association or the Government National Mortgage Association.
“GSE Asset-backed Security” means an Asset-backed Security the timely payment of interest and principal thereon when due is guaranteed by a GSE or the United States of America.
“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of)
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such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation, provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. The term “Guaranteed” has a meaning correlative thereto.
“ICA” means the Investment Company Act of l940.
“Illiquid Investment” means, as of any date, any Investment that has any material condition to or restriction on the ability of the Borrower or any assignee to sell, assign, transfer, pledge, hypothecate or otherwise encumber or liquidate the same in a commercially reasonable time and manner (other than customary securities law arrangements or restrictions), whether or not such condition or restriction is intrinsic to such investment, including without limitation, with respect to each Investment other than a Bank Loan, any condition or restriction that could reasonably be expected to (i) prohibit or delay the settlement of any such sale, assignment, transfer, pledge, hypothecation, encumbrancing or liquidation for more than seven (7) days, or (ii) require any payment (other than a nominal amount) in connection therewith, shall be deemed to be such a material condition or restriction, and in the event that the Borrower enters into any arrangement pursuant to which any Investment (other than a Bank Loan) is to be sold or otherwise transferred by the Borrower and such sale or transfer is not settled within seven (7) days, such investment shall be deemed to be an Illiquid Investment.
“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by or otherwise in respect of bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty, (h) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, (i) all Financial Contract Liabilities of such Person, (j) all obligations of such Person in respect of Senior Securities Representing Indebtedness, and (k) all Guarantees by such Person of any of the foregoing. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.
“Indemnified Taxes” means any Taxes, levies, imposts, duties, charges, fees, deductions or withholdings of any nature now or hereafter imposed or levied by any jurisdiction or any political subdivision thereof or taxing or other authority therein other than (a) net income taxes (however denominated), franchise taxes (imposed in lieu of net income taxes), branch profits taxes and any other similar taxes imposed upon the Bank (or its applicable lending office) by the jurisdiction under the laws of which the Bank (or its applicable lending office) is organized or in which its principal office is located or through which it holds the Loans or any political subdivision, taxing authority or other authority thereof or therein, (b) any taxes imposed as a result of a present or former connection between the Bank (or its applicable lending office) and the jurisdiction imposing such tax other than a connection arising solely as a result of the Bank (or its applicable lending office) having executed, delivered or performed its obligations or received payments under, or enforced, this Credit Agreement, or (c) any U.S. Federal withholding taxes imposed under FATCA.
“Indemnitee” has the meaning assigned to such term in Section 9.3(b).
“Indirect Fund” means an investment company (the “acquiring company”) that beneficially owns (a) in excess of 3.0% of the voting stock of any other investment company (other than a money market fund), (b) one or more securities, issued by another investment company (other than a money market fund), the aggregate value of which exceed 5.0% of the total assets of the acquiring company, or (c) one or more securities, issued by other investment companies (other than money market funds), the aggregate value of which exceed 10.0% of the total assets of the acquiring company.
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“Interest Payment Date” means (a) with respect to each ABR Loan, each FixedFloating Rate Loan and each Overnight Loan, the last Business Day of each calendar quarter, (b) with respect to each LIBORFixed Rate Loan, the last day of the Interest Period applicable to such LIBORFixed Rate Loan and, in the case of a LIBORFixed Rate Loan with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period, and (c) with respect to all Loans, the Commitment Termination Date.
“Interest Period” means, with respect to any LIBOR(a) each Existing LIBOR Loan, the interest period applicable thereto under and in accordance with this Credit Agreement as in effect immediately prior to the Amendment Effective Date and (b) each TS Loan, the period commencing on the date of the making of such LIBORTS Loan (or the last date upon which any other Loan was converted to, or continued as, such LIBORTS Loan) and ending on the numerically corresponding day in the calendar month that is one, three, or six months thereafter, in each case as the Borrower may elect and subject to the availability thereof, provided that, (ai) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day, unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, and (bii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period, (iii) no Interest Period shall extend beyond the Commitment Termination Date, and (iv) no tenor that has been removed from this definition pursuant to Section 3.5(d) shall be available for specification in any Borrowing Request.
“Investment” means, with respect to any Person, any direct or indirect portfolio investment by such Person in, or portfolio exposure (including through Financial Contracts) of such Person to (a) currencies, commodities, loans or securities, or any indexes on currencies, commodities, loans, securities, interest rates, or indexes, (b) any Financial Contract, or (c) any other medium for investment.
“Investment Adviser” means, with respect to the Borrower, the investment adviser or investment manager therefor.
“Laws” means, collectively, all international, foreign, federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.
“Level III Asset” means, at any time, any Investment of the Borrower (a) for which there are no Level 1 Inputs or Level 2 Inputs (in each case within the meaning of Topic ASC 820), or (b) the value of which is determined by reference to Level 3 Inputs (within the meaning of Topic ASC 820).
“LIBO Rate” means, with respect to any LIBOR Loan for any Interest Period, the higher of (a) 0.0%, and (b) the rate appearing on the Reuters “LIBOR01” screen displaying interest rates for Dollar deposits in the London interbank market (or on any successor or substitute page on such screen) at approximately 11:00 a.m., London time two Business Days prior to the commencement of such Interest Period, as the rate for Dollar deposits in the London interbank market with a maturity comparable to such Interest Period, provided that in the event such rate does not appear on such screen (or on any successor or substitute page on such screen or otherwise on such screen), the “LIBO Rate” with respect to such LIBOR Loan during such Interest Period shall be determined by reference to such other comparable publicly available service for displaying interest rates applicable to Dollar deposits in the London interbank market as may be selected by the Bank, provided further that in the absence of such availability, the “LIBO Rate” shall be determined by reference to the rate at which Dollar deposits of $1,000,000 in immediately available funds for a maturity comparable to such Interest Period are offered by the principal office of the Bank to leading banks in the London interbank market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, provided further that in the event the principal office of the Bank is not making such offers, “LIBO Rate” shall mean such other rate reflecting the Bank’s cost of funds as determined by the Bank using any reasonable or prevailing method.
“LIBOR Loan” means a Loan (or any portion thereof) bearing interest based on the Adjusted LIBO Rate.
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“Lien” means, with respect to (a) any asset, (i) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, and (ii) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement relating to such asset, and (b) any securities, any purchase option, call or similar right of a third party.
“Limited Nation” means any nation other than an Unlimited Nation.
“Loan” means a loan made pursuant to Section 2.2 or Section 2.3.
“Loan Balance” means, on any date of determination, an amount equal to the aggregate outstanding principal balance of the Loans.
“Loan Documents” means this Credit Agreement, the Security Documents, the Note, and all other agreements, certificates and other documents executed and delivered pursuant to any of the foregoing evidencing or securing the obligations of the Borrower hereunder or thereunder, together with all amendments, supplements or other modifications thereto.
“Margin Stock” has the meaning assigned to such term in Regulation U. “Material Adverse Effect” means a material adverse effect on (a) the property, assets, income or financial condition of the Borrower, (b) the ability of the Borrower to perform any of its monetary or other material obligations under any Loan Document or (c) the rights of, or benefits available to, the Bank under any Loan Document.
“Material Indebtedness” means Indebtedness of the Borrower (other than Indebtedness under the Loan Documents) in an aggregate principal amount exceeding the Threshold Amount.
“Maturity Date” means the earlier to occur of (a) the Commitment Termination Date, and (b) the date on which the outstanding principal balance of the Loans shall become due and payable in accordance herewith.
“Maximum Borrowing Value” means, at any time with respect to the Borrower’s assets constituting (a) Margin Stock, the “current market value” (within the meaning of Regulation U) thereof at such time, and (b) Non-Margin Assets, the “good faith loan value” (within the meaning of Regulation U) thereof at such time, provided that, with respect to each Non-Margin Asset, until such time, if any, as the Bank shall have notified the Borrower in writing of the Bank’s reasonable determination of the good faith loan value of such Non-Margin Asset, the Borrower may assume that the good faith loan value of such Non-Margin Asset is equal to 85% of the book value thereof.
“Measurement Date” means the date of the most recent audited financial statements of the Borrower which were delivered to the Bank prior to the date of this Credit Agreement.
“Money Market Fund” means, as of any date, any open-end investment company registered under the ICA that meets the requirements of Rule 2a-7 under the ICA.
“Moody’s” means Moody’s Investors Service, Inc.
“Multiemployer Plan” means at any time an employee pension benefit plan within the meaning of Section 4001(a)(3) of ERISA that is subject to ERISA and to which any member of an ERISA Group is then making or accruing an obligation to make contributions or has within the preceding five plan years made contributions, including for these purposes any Person which ceased to be a member of such ERISA Group during such five year period.
“Net Asset Value” means, at any time of determination, an amount equal to Adjusted Total Net Assets minus Adjusted Senior Debt.
“Non-Margin Assets” means assets of the Borrower which do not constitute Margin Stock, provided, that, for purposes of this definition, “Non-Margin Assets” shall not include “puts, calls or combinations thereof” within the meaning of Regulation U.
“Non-Recourse Person” has the meaning assigned to such term in Section 1.4.
“Note” means the promissory note, substantially in the form of Exhibit A, payable to the order of the Bank, including all replacements thereof and substitutions therefor.
“OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.
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“Offering Document” means the prospectus of the Borrower as amended from time to time through and including the Effective Date.
“One-month Eurodollar Rate” means, with respect to any Overnight Loan as of any date, the higher of (a) 0.0%, and (b) the rate of interest per annum that appears on the Reuters LIBOR01 Page as of 11:00 a.m., London time, on such date (or, if such date is not a Business Day, the immediately preceding Business Day) as Interbank Rates (One-month) for Dollars, provided that in the event such rate does not appear on such screen (or on any successor or substitute page on such screen or otherwise on such screen), the “One-month Eurodollar Rate” shall be determined by reference to such other comparable publicly available service for displaying one-month interest rates applicable to Dollar deposits in the London interbank market as may be selected by the Bank, provided further that in the absence of such availability, the “One-month Eurodollar Rate” shall be determined by reference to the rate at which one-month Dollar deposits of $1,000,000 in immediately available funds are offered by the principal office of the Bank to leading banks in the London interbank market at approximately 11:00 a.m., London time, on such date (or, if such date is not a Business Day, the immediately preceding Business Day), provided further that in the event the principal office of the Bank is not making such offers, “One-month Eurodollar Rate” shall mean such other rate reflecting the Bank’s one-month cost of funds as reasonably determined by the Bank using any reasonable or prevailing method.
“Ordinary Course Lien” means any Lien referred to in Section 7.2(a), (b), (c), (d) or (e)(i).
“Ordinary Liabilities” means, with respect to the Borrower as of any date, “all liabilities and indebtedness” (within the meaning of the first sentence of Section 18(h) of the ICA) of the Borrower other than (a) Senior Debt, (b) Financial Contract Liabilities, (c) Secured Liabilities, and (d) Segregated Liabilities.
“Organization Documents” means, (a) with respect to any corporation, its certificate of incorporation or charter, and by-laws, (b) with respect to any partnership, its partnership agreement, (c) with respect to any limited liability company, its certificate of formation and limited liability company agreement, (d) with respect to any business trust or statutory trust, its certificate of trust, if any, and declaration of trust, and (e) with respect to any other Person, the counterpart documents thereof.
“Overnight Eurodollar Rate” means, with respect to any ABR Loan as of any date, the higher of (a) 0.0%, and (b) the rate of interest per annum that appears on the Reuters LIBOR01 Page as of 11:00 a.m., London time, on such date (or, if such date is not a Business Day, the immediately preceding Business Day) as Interbank Rates (Overnight) for Dollars, provided that in the event such rate does not appear on such screen (or on any successor or substitute page on such screen or otherwise on such screen), the “Overnight Eurodollar Rate” shall be determined by reference to such other comparable publicly available service for displaying overnight interest rates applicable to Dollar deposits in the London interbank market as may be selected by the Bank, provided further that in the absence of such availability, the “Overnight Eurodollar Rate” shall be determined by reference to the rate at which overnight Dollar deposits of $1,000,000 in immediately available funds are offered by the principal office of the Bank to leading banks in the London interbank market at approximately 11:00 a.m., London time, on such date (or, if such date is not a Business Day, the immediately preceding Business Day), provided further that in the event the principal office of the Bank is not making such offers, “Overnight Eurodollar Rate” shall mean such other rate reflecting the Bank’s overnight cost of funds as reasonably determined by the Bank using any reasonable or prevailing method.
“Overnight Loan” means a Loan (or any portion thereof) bearing interest based on the One-month Eurodollar Ratepursuant to clause (b) of the defined term Term SOFR.
“Patriot Act” means the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)).
“Permitted Investments” means all Investments of the Borrower, in each case (a) to the extent that the Borrower has the power and authority under its Organization Documents to invest therein, and (b) to the extent the investment therein, ownership thereof, or exposure thereto, by the Borrower is in conformity with the Offering Document.
“Permitted Liens” means Liens permitted by Section 7.2.
“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
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“Plan” means at any time an employee pension benefit plan (other than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Code and either (a) is maintained, or contributed to, by any member of an ERISA Group for employees of any member of an ERISA Group or (b) has at any time within the preceding five years been maintained, or contributed to, by any Person which was at such time a member of an ERISA Group for employees of any Person which was at such time a member of an ERISA Group.
“Prime Rate” means the rate of interest per annum publicly announced from time to time by the Bank as its prime commercial lending rate; each change in the Prime Rate being effective from and including the date such change is publicly announced as being effective. The Prime Rate is not intended to be the lowest rate of interest charged by the Bank in connection with extensions of credit to borrowers.
“Private Label Asset-backed Security” means an Asset-backed Security other than a GSE Asset-backed Security or a U.S. Government Security.
“Regulated Investment Company” has the meaning set forth in Section 851 of the Code.
“Regulation D” means Regulation D of the Board of Governors as from time to time in effect and all official rulings and interpretations thereunder or thereof.
“Regulation T” means Regulation T of the Board of Governors as from time to time in effect and all official rulings and interpretations thereunder or thereof.
“Regulation U” means Regulation U of the Board of Governors as from time to time in effect and all official rulings and interpretations thereunder or thereof.
“Regulation X” means Regulation X of the Board of Governors as from time to time in effect and all official rulings and interpretations thereunder or thereof.
“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.
“Relevant Governmental Body” means the Board of Governors or the Federal Reserve Bank of New YorkFRBNY, or a committee officially endorsed or convened by the Board of Governors or the Federal Reserve Bank of New YorkFRBNY, or any successor thereto.
“Restricted Nation” means Greece, Ireland, Italy, Portugal and Spain.
“Restricted Payment” means (a) any dividend or other distribution by the Borrower (whether in cash, securities or other property) with respect to any shares, units or other equity interests issued by the Borrower, and (b) any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, by the Borrower on account of the purchase, redemption, retirement, acquisition, cancellation, defeasance, tender offer or other termination of any such shares, units or other equity interests; provided, however, that any dividend, distribution or other payment payable solely in shares of common stock of the Borrower shall not constitute a “Restricted Payment”.
“Rule 18f-4” means rule 18f-4 under the ICA.
“S&P” means Standard & Poor’s Financial Services LLC, a subsidiary of The McGraw Hill Companies, Inc.
“Sanctioned Jurisdiction” means, at any time, a country, region or territory which is the subject or target of country-based or region-based (not individual- or entity-based) Sanctions.
“Sanctioned Person” means, at any time, any Person that is the subject or target of any Sanction.
“Sanctions” has the meaning set forth in Section 4.15(a).
“Scheduled Commitment Termination Date” means December 2827, 20222023.
“SEC” means the U.S. Securities and Exchange Commission and/or any other Governmental Authority succeeding to the functions thereof with respect to the ICA and the Securities Act.
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“Secured Liability” means each liability of the Borrower secured by a Lien on property (other than Excluded Assets).
“Securities Act” means the Securities Act of 1933.
“Security Agreement” has the meaning set forth in Section 5.1(f).
“Security Documents” means the Security Agreement, the Control Agreement and each other agreement, instrument or other document executed or delivered pursuant thereto.
“Segregated Liability” means each liability or other obligation of the Borrower relating to assets (other than Excluded Assets) that have been segregated or are otherwise subject to margin arrangements (including assets segregated by the Borrower to comply with Section 18 of the ICA with respect to Financial Contracts).
“Senior Debt” means, as of any date, the aggregate amount of Senior Securities Representing Indebtedness of the Borrower.
“Senior Security” has the meaning set forth in the first sentence of Section 18(g) of the ICA.
“Senior Security Representing Indebtedness” has the meaning set forth in the first sentence of Section 18(g) of the ICA.
“SOFR” means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.
“SOFR Adjustment” means (a) for any calculation with respect to an ABR Loan or an Overnight Loan, 0.10%, and (b) for any calculation with respect to a TS Loan, a percentage per annum as set forth below for the applicable Interest Period therefor:
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Interest Period
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Percentage
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One month
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0.10%
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Three months
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0.15%
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Six months
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0.25%
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“SOFR Administrator” means the FRBNY (or a successor administrator of the secured overnight financing rate).
“SOFR” means a rate per annum equal to the secured overnight financing rate for such Business Day published by the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate) on Administrator’s Website” means the website of the Federal Reserve Bank of New YorkFRBNY, currently at http://www.newyorkfed.org (, or any successor source for the secured overnight financing rate identified as such by the administrator of the secured overnight financing rateSOFR Administrator from time to time).
“Status” has the meaning set forth in Section 4.16.
“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board of Governors to which the Bank is subject for eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D). Such reserve percentages shall include those imposed pursuant to such Regulation D. LIBOR Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to the Bank under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
“Taxes” means any and all current or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority.
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“Term SOFR” means,
(a) for any calculation with respect to a TS Loan, the Term SOFR Reference Rate for a tenor comparable to the applicable Interest Period on the day (such day, the “Periodic Term SOFR Determination Day”) that is two (2) U.S. Government Securities Business Days prior to the first day of such Interest Period, as such rate is published by the Term SOFR Administrator; provided, however, that if as of 5:00 p.m. (New York City time) on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Periodic Term SOFR Determination Day, and
(b) for any calculation with respect to an Overnight Loan on any day, the Term SOFR Reference Rate for a tenor of one month on the day (such day, the “Overnight Term SOFR Determination Day”) that is two (2) U.S. Government Securities Business Days prior to such day, as such rate is published by the Term SOFR Administrator; provided, however, that if as of 5:00 p.m. (New York City time) on any Overnight Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Overnight Term SOFR Determination Day.
“Term SOFR Administrator” means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by the Bank in its reasonable discretion).
“Term SOFR Loan” means a Loan bearing interest based on Adjusted Term SOFR.
“Term SOFR” means, for the applicable corresponding tenor, Reference Rate” means the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.
“Threshold Amount” means the lesser of (a) 1.0% of the aggregate Net Asset Value of the Borrower, and (b) $1,000,000.
“Total Net Assets” means, as of any date, (a) the “value of the total assets” (within the meaning of the first sentence of Section 18(h) of the ICA) of the Borrower less (b) the Ordinary Liabilities of the Borrower.
“Transactions” means the (a) execution, delivery and performance by the Borrower of each Loan Document to which it is a party, (b) borrowing of the Loans and (c) use of the proceeds of the Loans.
“TS Loan” means a Loan bearing interest based on clause (b) of the definition of Term SOFR.
“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.
“United States” and “U.S.” mean the United States of America.
“Unlimited Nation” means (a) each G-10 country, (b) Australia, and (c) New Zealand.
“U.S. Government Securities Business Day” means any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.
“U.S. Government Security” means any debt obligation, other than an Asset-backed Security, the timely repayment of the principal thereof, and interest thereon, is backed by the full faith and credit of the United States of America.
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“USD LIBOR” means the London interbank offered rate for Dollars.
“Value” means, as of any day of determination in respect of any Investment of the Borrower, the value of such Investment computed in the manner such value is required to be computed by the Borrower in accordance with the Borrower’s internal policies, GAAP and applicable law (including the ICA).
“Variable Rate Loan” means an ABR Loan, a LIBOR Loan or an Overnight Loan.
“Written Fixed Borrowing Request” means a request in accordance with Section 2.3 for a Fixed Rate Loan and, if required in writing, in the form of Exhibit C-2.
“Written Variable Borrowing Request” means a request in accordance with Section 2.2 for a Variable Rate Loan and, if required in writing, in the form of Exhibit C-1.
1.2 Terms Generally
The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise, (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any definition of or reference to any law, rule or regulation shall be construed as referring to such law, rule or regulation as from time to time amended and any successor thereto and in the case of such law, the rules and regulations promulgated from time to time thereunder, (c) any reference herein to any Person shall be construed to include such Person’s successors and permitted assigns, (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Credit Agreement in its entirety and not to any particular provision hereof, and (e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Credit Agreement.
1.3 Accounting Terms
As used in the Loan Documents and in any certificate, opinion or other document made or delivered pursuant thereto, accounting terms not defined in Section 1.1, and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under Applicable Accounting Principles. If at any time any change in Applicable Accounting Principles would affect the computation of any financial ratio or requirement set forth in this Credit Agreement and (a) the Borrower notifies the Bank that the Borrower objects to determining compliance with such financial ratio or requirement on the basis of Applicable Accounting Principles in effect immediately after such change becomes effective or (b) the Bank so objects, then the Borrower’s compliance with such ratio or requirement shall be determined on the basis of Applicable Accounting Principles in effect immediately before such change becomes effective, until either such notice is withdrawn by the Borrower or the Bank, as the case may be, or the Borrower and the Bank otherwise agree. Except as otherwise expressly provided herein, the computation of financial ratios and requirements set forth in this Credit Agreement shall be consistent with the Borrower’s financial statements required to be delivered hereunder.
1.4 Non-Recourse Persons
The Bank hereby agrees for the benefit of each and every trustee, director, and officer of, and each record owner of any outstanding shares of, the Borrower (each a “Non-Recourse Person”) that (a) no Non-Recourse Person shall have any personal liability for any obligation of the Borrower under any Loan Document or other instrument or document delivered pursuant hereto or thereto; and (b) no claim against any Non-Recourse Person or any property thereof may be made for any obligation of the Borrower under any Loan Document or other instrument or document delivered pursuant hereto or thereto, whether for the payment of principal of, or interest on, the Loans or for any fees, expenses or other amounts payable by the Borrower hereunder or thereunder.
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1.5 Rates; Conforming Changes
(a) The Bank does not warrant or accept responsibility for, and shall not have any liability with respect to (i) the continuation of, administration of, submission of, calculation of or any other matter related to the Alternate Base Rate, the Term SOFR Reference Rate, Adjusted Term SOFR, Term SOFR, Adjusted Daily Simple SOFR, or Daily Simple SOFR, or any component definition thereof or rates referred to in the definition thereof, or any alternative, successor or replacement rate thereto (including any Benchmark Replacement), including whether the composition or characteristics of any alternative, successor or replacement rate therefor (including any Benchmark Replacement) will be similar to, or produce the same value or economic equivalence of, or have the same volume or liquidity as, the Alternate Base Rate, the Term SOFR Reference Rate, Adjusted Term SOFR, Term SOFR, Adjusted Daily Simple SOFR, or Daily Simple SOFR or any other Benchmark prior to its discontinuance or unavailability, or (ii) the effect, implementation or composition of any Conforming Changes. The Bank and its affiliates or other related entities may engage in transactions that affect the calculation of one or more of the Alternate Base Rate, the Term SOFR Reference Rate, Adjusted Term SOFR, Term SOFR, Adjusted Daily Simple SOFR, or Daily Simple SOFR, any alternative, successor or replacement rate (including any Benchmark Replacement) or any relevant adjustments thereto, in each case, in a manner adverse to the Borrower. The Bank may select information sources or services in its reasonable discretion to ascertain the Alternate Base Rate, the Term SOFR Reference Rate, Adjusted Term SOFR, Term SOFR, Adjusted Daily Simple SOFR, or Daily Simple SOFR, or any other Benchmark, in each case pursuant to the terms of this Credit Agreement, and shall have no liability to the Borrower or any other person or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.
(b) In connection with the use or administration of Daily Simple SOFR and Term SOFR, the Bank will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Credit Agreement or any other Loan Document. The Bank will promptly notify the Borrower of the effectiveness of any Conforming Changes.
ARTICLE II
THE CREDITS
2.1 Commitment
Subject to the terms and conditions set forth herein, the Bank agrees to make loans to the Borrower from time to time during the period from the Effective Date through the Business Day immediately preceding the Commitment Termination Date, provided that immediately after giving effect thereto, the Loan Balance will not exceed the Commitment. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Loans.
2.2 Variable Rate Loans
(a) General Provisions. To request a Variable Rate Loan, the Borrower shall make a telephonic Borrowing Request to the Bank, not later than (i) in the case of a Floating Rate Loan, 1:00 p.m., Eastern time, on the Business Day of the proposed Loan, or (ii) in the case of a LIBORTS Loan, 11:00 a.m., Eastern time, three (3) Business Days before the date of the proposed Loan. Such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or facsimile to the Bank of a duly executed Written Variablewritten Borrowing Request duly signed by or on behalf of the Borrower. Each such telephonic and Written Variablewritten Borrowing Request shall specify: (A) the requested date for such Variable Rate Loan (which shall be a Business Day), (B) whether such Variable Rate Loan is to be an ABR Loan, a LIBORTS Loan, or an Overnight Loan, (C) the amount of such Variable Rate Loan, which shall be an Approved Amount, and (D) with respect to each LIBORTS Loan, the Interest Period therefor, provided that, if either (x) the Borrower shall fail to specify whether such requested Variable Rate Loan is to be an ABR Loan, a LIBORTS Loan, or an Overnight Loan or (y) immediately after giving effect to the making of such requested Variable Rate Loan, there would be LIBORFixed Rate Loans outstanding with in excess of three (3) different Interest Periods, then such requested Variable Rate Loan shall be made as an ABR Loan.
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(b) Optional Conversion or Continuation of Variable Rate Loans. Subject to Section 2.2(c), prior to the MaturityCommitment Termination Date, the Borrower may elect to (i) convert all or any portion of a Variable Rate Loan to a different type of Variable Rate Loan (other than to a LIBOR Loan), or (ii) continue all or any portion of a LIBORTS Loan as a LIBORTS Loan having an additional Interest Period, provided that, in each such case, the principal amount to be converted to or continued shall be in an Approved Amount. Each such election shall be made by the Borrower by a telephonic Borrowing Request to the Bank, shall be irrevocable and shall (A) be made not later than (x) in the case of a conversion of a Variable Rate Loan to, or the continuation of a Variable RateTS Loan as, a LIBORTS Loan, 11:00 a.m., Eastern time, three (3) Business Days before the date of the proposed conversion or continuation, or (y) in all other cases not later than 1:00 p.m., Eastern time, on the Business Day of the proposed conversion or continuation, (B) specify the following information (w) the amount of the Variable Rate Loan requested to be converted or continued, (x) the requested date for such conversion or continuation, which shall be a Business Day, (y) whether such Variable Rate Loan is to be converted into an ABR Loan, Overnight Loan or a LIBORTS Loan, or continued as a LIBORTS Loan, and (z) in the case of a Variable Rate Loan being converted into or continued as a LIBORTS Loan, the Interest Period to be applicable thereto, and (C) be confirmed promptly by hand delivery or facsimile to the Bank of a duly executed Written variablewritten Borrowing Request signed by or on behalf of the Borrower, provided that, if (x) prior to the expiration of the Interest Period applicable to an existing LIBORFixed Rate Loan, the Borrower shall fail to timely elect to continue or convert such LIBORFixed Rate Loan in accordance herewith, such LIBORFixed Rate Loan shall, on the last day of such Interest Period, be automatically converted to an ABR Loan, and (y) if immediately after giving effect to any such requested conversion or continuation of any Variable Rate Loan, there would be VariableFixed Rate Loans outstanding with in excess of three (3) different Interest Periods, then such Loan shall be converted to an ABR Loan.
(c) Other. Notwithstanding anything to the contrary herein contained, the Borrower’s right to make elections pursuant to Section 2.2(b) shall cease (i) upon notice by the Bank to the Borrower upon the occurrence or during the continuance of an Event of Default (other than an Event of Default under Section 8.1(h) or (i)) that the Borrower’s right to make elections pursuant to Section 2.2(b) has been terminated, and (ii) automatically and without notice upon the occurrence or during the continuance of an Event of Default under Section 8.1(h) or (i).
2.3 Fixed Rate Loans[Reserved]
(a) In order to borrow, or convert all or any part of a Variable Rate Loan into, a Fixed Rate Loan, the Borrower shall deliver to the Bank a Written Fixed Borrowing Request, duly signed by or on behalf of the Borrower, no later than 10:00 a.m., Eastern time, two (2) Business Days prior to the date of such requested borrowing or conversion, setting forth (i) the amount of the proposed Fixed Rate Loan, which shall be an Approved Amount, (ii) whether it is a new borrowing or a conversion of all or any part of any outstanding Variable Rate Loans, and (iii) the interest period to be used by the Bank to determine the applicable Fixed Rate, which may be between 1 year and 10 years (in increments of 1 year) or such other period mutually agreed to by the Bank and the Borrower (with respect to such Fixed Rate Loan, the “Fixed Period”). Immediately after the Borrower has delivered the Written Fixed Borrowing Request, the Borrower shall notify and confirm with the Bank by telephone the Bank’s receipt of the Written Fixed Borrowing Request. Promptly after receipt of such Written Fixed Borrowing Request and telephonic confirmation, the Bank shall endeavor to telephonically advise the Borrower by 3:30 p.m., Eastern time, on such date as to the actual Fixed Rate being offered at that moment as the Fixed Rate that would be applicable to such Fixed Rate Loan, and the Borrower shall, upon being so advised of such offer of such Fixed Rate, either confirm its acceptance or rejection of such Fixed Rate. Notwithstanding anything to the contrary contained herein, in the event the Borrower shall fail to either accept or reject such offer, such offer shall be conclusively be deemed to have been rejected.
(b) Following acceptance of the proposed Fixed Rate by the Borrower in accordance with Section 2.3(a), the Bank shall send a written confirmation thereof to the Borrower (provided that the Bank’s failure so to do shall not affect the obligations of the Borrower hereunder).
(c) To the extent the Borrower has not repaid a Fixed Rate Loan as of the earlier of (i) the last day of the Fixed Period therefor, or (ii) the date it has become due and payable, whether due to maturity, acceleration or otherwise, it shall be automatically converted to an ABR Loan on such date. Notwithstanding anything to the contrary herein contained, each Fixed Rate Loan shall be converted to an ABR Loan (i) upon notice by the Bank to the Borrower upon the occurrence or during the continuance of an Event of Default (other than an Event of Default under Section 8.1(h) or (i)), and (ii) automatically and without notice upon the occurrence or during the continuance of an Event of Default under Section 8.1(h) or (i).
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(d) Notwithstanding anything to the contrary herein contained, the Borrower’s right to make borrowings and/or conversions pursuant to this Section 2.3 shall cease (i) upon notice by the Bank to the Borrower upon the occurrence or during the continuance of an Event of Default (other than an Event of Default under Section 8.1(h) or (i)) that the Borrower’s right to make elections pursuant to Section 2.3 has been terminated, and (ii) automatically and without notice upon the occurrence or during the continuance of an Event of Default under Section 8.1(h) or (i).
2.4 Termination and Reduction of Commitment
(a) Unless previously terminated, the Commitment shall terminate on the Commitment Termination Date.
(b) The Borrower may at any time terminate, or from time to time reduce, without premium or penalty, the Commitment, provided that (i) the Borrower may not terminate or reduce the Commitment if, immediately after giving effect thereto and to any concurrent repayment of the Loans in accordance with Section 2.5 or 2.6, the outstanding principal balance of the Loans would exceed the Commitment, and (ii) each such reduction shall be in a minimum amount of $5,000,000 and in an integral multiple of $1,000,000.
(c) The Borrower shall notify the Bank of any election to terminate or reduce the Commitment under paragraph (b) of this Section at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Each notice delivered by the Borrower pursuant to this Section shall be irrevocable and any termination or reduction of the Commitment hereunder shall be permanent. Each termination or reduction of the Commitment shall be accompanied by the payment of accrued and unpaid commitment fees to the extent required by Section 3.2.
2.5 Repayment of Loans
(a) The Borrower hereby unconditionally promises to pay to the Bank the then unpaid principal amount of each Loan on the MaturityCommitment Termination Date.
(b) In the event that on any date, the Borrower shall fail to be in compliance with Section 7.7(a) for twenty (20) consecutive days, the Borrower shall immediately repay the Loans and take such other actions as may be necessary such that, immediately after giving effect to such repayment and other actions, the Borrower is in compliance with Section 7.7(a).
(c) In the event that on any date, the Borrower shall fail to be in compliance with Section 7.7(b), the Borrower shall immediately repay the Loans and take such other actions as may be necessary such that, immediately after giving effect to such repayment and other actions, the Borrower is in compliance with Section 7.7(b).
2.6 Voluntary Prepayments
The Borrower shall have the right at any time and from time to time, without premium or penalty (but subject to Section 3.7), to prepay any Loan in whole or in part. The Borrower shall notify the Bank by telephone (confirmed by facsimile) of any prepayment hereunder not later than 2:00 p.m., Eastern time, (i) three Business Days prior to date of prepayment in the case of a LIBORFixed Rate Loan, or (ii) one Business Day (or such shorter period as the Bank may agree) prior to the date of prepayment in all other cases. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Loan or portion thereof to be prepaid. Each partial prepayment of the Loans pursuant to this Section 2.6 shall be in an Approved Amount. Prepayments shall be accompanied by accrued and unpaid interest to the extent required by Section 3.1.
2.7 Payments Generally
The Borrower shall make each payment required to be made by it hereunder or under any other Loan Document (whether of principal of Loans, interest, fees, or otherwise) prior to 2:00 p.m., Eastern time, on the date when due, in immediately available funds, without setoff or counterclaim. Any amounts received after such time on any date shall be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Bank at its office at 40 King Street West, Toronto, Ontario, Canada M5H 1H1, or such other office as to which the Bank may notify the Borrower. Except as may be otherwise provided in the defined term “Interest Period”, if any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the
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case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in Dollars. If at any time insufficient funds are received by and available to the Bank from the Borrower to pay fully all amounts of principal of Loans, interest, fees and other amounts then due under the Loan Documents, such funds shall be applied to the obligations owing to the Bank: (i) first, to payment of such amounts (excluding principal, interest and fees), in such order as the Bank may choose, (ii) second, to such interest and fees then due, and (iii) third, to such principal of the Loans then due. All amounts paid under the Loan Documents shall not be refundable under any circumstances.
2.8 Evidence of Debt
The Loans made by the Bank shall be evidenced by one or more accounts or records maintained by the Bank in the ordinary course of business. The accounts or records maintained by the Bank shall be conclusive absent manifest error of the amount of the Loans made by the Bank to the Borrower and the interest and payments thereon. Any failure to so 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 under the Loan Documents. Upon the request of the Bank, the Borrower shall execute and deliver to the Bank a Note, which shall evidence the Loans in addition to such accounts or records.
2.9 [Reserved.]
ARTICLE III
INTEREST, FEES, YIELD PROTECTION, ETC.
3.1 Interest
(a) Each Loan shall bear interest at a rate per annum equal to the Applicable Rate, provided that if an Event of Default has occurred and is continuing, then, so long as such Event of Default is continuing, (i) the principal balance of such Loan shall bear interest at a rate per annum equal to the Applicable Rate plus 2.00%, and (ii) all other amounts owing under the Loan Documents that are not paid when due, shall bear interest, after as well as before judgment, at a rate per annum equal to the Alternate Base Rate plus 2.00%.
(b) Accrued and unpaid interest on each Loan shall be payable in arrears on each Interest Payment Date applicable thereto, provided that (1) interest accrued and unpaid pursuant to each of clauses (i) and (ii) of paragraph (a) of this Section shall be payable on demand, and (2) in the event of any repayment or prepayment of any Loan, accrued and unpaid interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment. All interest hereunder shall be computed on the basis of a year of 360 days (provided that interest computed by reference to the Prime Rate shall be on the basis of a year of 365 or 366 days, as applicable) for the actual number of days elapsed (including the day a Loan is made but excluding the date of repayment). The Alternate Base Rate, the Federal Funds Effective Rate, the LIBO Rate, the One-month Eurodollar Rate, the Overnight Eurodollar RateAdjusted Daily Simple SOFR, Adjusted Term SOFR and the Prime Rate shall each be determined by the Bank in accordance with the provisions of this Credit Agreement, and such determination shall be conclusive absent manifest error.
3.2 Fees
The Borrower shall pay to the Bank a commitment fee, at a rate per annum equal to the Commitment Fee Rate during the period from and including the date on which this Credit Agreement shall have become effective in accordance with Section 9.6 to but excluding the Commitment Termination Date, on the daily amount of the excess of the Commitment over the Loan Balance. Accrued and unpaid commitment fees shall be payable in arrears on the last Business Day of March, June, September and December of each year, each date on which the Commitment is reduced and on the date on which the Commitment terminates, commencing on the first such date to occur after the date hereof. All commitment fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).
3.3 Increased Costs
(a) If there shall occur any Change in Circumstance and the result thereof shall be (i) to increase the cost to the Bank of making or maintaining any Loan, or to reduce the amount of any sum received or receivable by the Bank from the Borrower under the Loan Documents (whether of principal, interest or otherwise),
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then the Borrower will pay to the Bank such amount as will compensate the Bank for such increased costs or reduced amount, or (ii) to increase the cost to the Bank of maintaining the Commitment, then the Borrower will pay to the Bank such amount as will compensate the Bank for such increased costs.
(b) If the Bank determines in good faith that any Change in Law regarding liquidity or capital requirements has or would have the effect of reducing the rate of return on the Bank’s capital or on the capital of the Bank’s holding company, as a consequence of this Credit Agreement or any Loan made by the Bank hereunder to a level below that which the Bank or the Bank’s holding company could have achieved but for such Change in Law (taking into consideration the Bank’s policies and the policies of the Bank’s holding company with respect to liquidity and capital adequacy), then from time to time the Borrower will pay to the Bank such additional amount or amounts as will compensate the Bank or the Bank’s holding company for (i) any such reduction suffered as a consequence of such Loan, and (ii) any other such reduction.
(c) A certificate of the Bank setting forth the Bank’s reasonable good faith determination of the additional amount or amounts necessary to compensate the Bank or its holding company, as applicable, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The amount shown as payable on any such certificate shall be due within ten days after receipt thereof. In determining such additional amounts of compensation, the Bank will act reasonably and in good faith.
(d) Failure or delay on the part of the Bank to demand compensation pursuant to this Section shall not constitute a waiver of the Bank’s right to demand such compensation; provided that the Borrower shall not be required to compensate the Bank pursuant to this Section for any increased costs or reductions incurred more than 90 days prior to the date that the Bank notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of the Bank’s intention to claim compensation therefor; and provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 90-day period referred to above shall be extended to include the period of retroactive effect thereof.
3.4 Taxes
(a) All payments by the Borrower hereunder and under any of the other Loan Documents shall be made in Dollars, in each case without setoff or counterclaim and free and clear of and without deduction for any Taxes, unless the Borrower is required by law (as determined in the good faith discretion of the Borrower or its agent) to make such deduction or withholding. Subject to Section 3.4(b), if any Indemnified Taxes are required to be withheld with respect to any amount payable by the Borrower hereunder or under any of the other Loan Documents, the Borrower will pay to the Bank on the date on which such amount is due and payable hereunder or under such other Loan Document, such additional amount in Dollars as shall be necessary to enable the Bank to receive the same net amount which the Bank would have received on such due date had no such Indemnified Taxes been required to be withheld. The Borrower will deliver promptly to the Bank certificates or other valid vouchers for all Taxes or other charges deducted from or paid with respect to payments made by the Borrower hereunder or under such other Loan Document. If the Borrower reasonably believes that such Indemnified Taxes were not correctly or reasonably asserted, the Bank will use reasonable efforts to cooperate (at the sole cost and expense of the Borrower) with the Borrower to obtain a refund of such taxes (which shall be repaid to the Borrower so long as such efforts would not, in the good faith determination of the Bank, result in any material additional costs, expenses or risks or be otherwise disadvantageous to it). The Bank agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to change the jurisdiction of its applicable lending office if the making of such a change would avoid the need for, or reduce the amount of, any such amounts payable by the Borrower that may thereafter accrue and would not, in the reasonable judgment of the Bank, be otherwise disadvantageous to the Bank.
(b) Notwithstanding anything to the contrary contained in Section 3.4(a), the Borrower will not be required to make any additional payment to or for the account of the Bank with respect to any Indemnified Taxes under Section 3.4(a) (i) by reason of a breach by the Bank of any certification or representation set forth in any form furnished to the Borrower under Section 3.4(d), (ii) by reason of the Bank’s failure or inability to furnish under Section 3.4(d) an original or an extension or renewal of any form required under Section 3.4(d), or (iii) if such Indemnified Taxes are withholding taxes imposed on amounts payable to the Bank at the time the Bank became a party to this Credit Agreement (or designates a new lending office or changes its place of organization or principal office), except to the extent that the Bank’s assignor (if any) was entitled, at the time of assignment, to receive additional amounts, from the Borrower with respect to such Indemnified Taxes pursuant to Section 3.4(a).
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(c) If the Bank determines, in its reasonable discretion, that it has received a refund of any taxes as to which it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to Section 3.4(a), it shall pay over such refund to the Borrower (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower under Section 3.4(a)), net of all out-of-pocket expenses of the Bank and without interest (other than any interest paid by the relevant governmental authority with respect to such refund); provided, that the Borrower, upon the request of the Bank, agrees to repay the amount paid over to the Borrower (plus any penalties, interest or other charges imposed by the relevant governmental authority) to the Bank in the event the Bank is required to repay such refund to such governmental authority. The Bank agrees, that upon the occurrence of any event giving rise to a tax as to which it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to Section 3.4(a), it will use reasonable efforts to mitigate the effect of any such event, including by designating another lending office for any Loan affected by such event and by completing and delivering or filing any tax-related forms which would reduce or eliminate such tax or additional amounts.
(d) (i) If the Bank is not a Foreign Lender it shall deliver to the Borrower an original signed, properly completed IRS Form W-9 (or any successor form) certifying that the Bank is not subject to U.S. backup withholding tax, on or prior to the date on which the Bank becomes a party to this Credit Agreement, promptly upon the obsolescence, expiration, or invalidity of any form previously delivered by the Bank, and from time to time thereafter upon the request of the Borrower.
(ii) If the Bank is a Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the Borrower is resident for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments hereunder or under any other Loan Document, the Bank (x) shall deliver to the Borrower, at the time or times prescribed by applicable law or reasonably requested by the Borrower, such properly completed and executed documentation prescribed by such applicable law as will permit such payments to be made without withholding or at a reduced rate of withholding, and (y) if requested by the Borrower, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower, including without limitation, as will enable the Borrower to determine whether or not the Bank is subject to backup withholding or information reporting requirements. Without limiting the generality of the foregoing, in the event that (A) the Borrower is resident for tax purposes in the United States, and (B) the Bank is a Foreign Lender, the Bank shall deliver to the Borrower on or prior to the date on which the Bank becomes a party to this Credit Agreement (and promptly upon the obsolescence, expiration or invalidity of any form or certificate previously delivered by the Bank or from time to time thereafter upon the reasonable request of the Borrower), whichever of the following is applicable:
(1) original signed and duly completed copies of Internal Revenue Service Form W-8BEN or W-8BEN-E (or any successor form) claiming eligibility for benefits of an income tax treaty to which the United States is a party that reduces or eliminates withholding tax;
(2) original signed and duly completed copies of Internal Revenue Service Form W-8ECI (or any successor form);
(3) in the case in which the Bank is claiming the benefits of the exemption for portfolio interest under section 881(c) of the Internal Revenue Code, (x) a written certificate that the Foreign Lender is not (A) a “bank” within the meaning of section 881(c)(3)(A) of the Internal Revenue Code, (B) a “10 percent shareholder” of the Borrower within the meaning of section 871(h)(3)(B) of the Internal Revenue Code, or (C) a “controlled foreign corporation” receiving interest from a related person within the meaning of section 881(c)(3)(C) of the Internal Revenue Code and (y) original signed and duly completed copies of Internal Revenue Service Form W-8BEN or W-8BEN-E (or any successor form); or
(4) any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in United States Federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower to determine the withholding or deduction required to be made.
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(iii) If a payment made to the Bank under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if the Bank were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), the Bank shall deliver to the Borrower at the time or times prescribed by law and at such time or times reasonably requested by the Borrower such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower as may be necessary for the Borrower to comply with its obligations under FATCA and to determine the Bank has complied with its obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this Section 3.4(d)(iii), “FATCA” shall include any amendments made to FATCA after the Effective Date.
3.5 Alternate Rate of Interest
Notwithstanding anything to the contrary herein or in any other Loan Document:
If (i) neither a Benchmark Transition Event nor an Early Opt-in Election has occurred and (ii) the Bank determines (which determination shall be conclusive absent manifest error) that, with respect to any existing or requested Fixed Rate Loan, LIBOR Loan or Overnight Loan (each an “Affected Loan”), by reason of one or more circumstances arising after the date hereof affecting such Applicable Money Market, adequate and reasonable means do not exist for ascertaining the rate of interest applicable to such Affected Loan, or that such rate of interest will not adequately and fairly reflect the cost to the Bank of making, maintaining, converting or continuing such Affected Loan because of (x) any change since the date hereof in any applicable law or governmental rule, regulation, order or directive (whether or not having the force of law) or in the interpretation or administration thereof or (y) other circumstances arising after the date hereof affecting the Bank or such Applicable Money Market, then the Bank may give notice thereof to the Borrower by telephone or facsimile and (A) upon the giving of such notice, each existing Affected Loan shall automatically be deemed converted into and redenominated as an ABR Loan and shall thereafter bear interest at a rate per annum equal to the Applicable Rate therefor, and (B) until such notice is rescinded by the Bank, the Bank shall have no obligation to make any new Loan that would be an Affected Loan. The Bank agrees that promptly after it shall have determined, with respect to any notice given by it under this Section, that the circumstance or circumstances that gave rise to such notice with respect to an Affected Loan no longer exist, the Bank shall by notice to the Borrower rescind such notice with respect to such Affected Loan.
(a) (b) (i) On March 5, 2021 the Financial Conduct Authority (“FCA”), the regulatory supervisor of USD LIBOR’s administrator (“IBA”), announced in a public statement the future cessation or loss of representativeness of overnight/Spot Next, 1-month, 3-month, 6-month and 12-month USD LIBOR tenor settings. On the earlier of (x) the date that all Available Tenors of USD LIBOR have either permanently or indefinitely ceased to be provided by IBA or have been announced by the FCA pursuant to public statement or publication of information to be no longer representative and (y) the Early Opt-in Effective Date, if Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Loan Document, if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior any setting of the then-current Benchmark is USD LIBOR, the, then (x) if a Benchmark Replacement is determined in accordance with clause (a) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any setting of such Benchmark on such day and allsetting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Credit Agreement or any other Loan Document and (y) if a Benchmark Replacement is determined in accordance with clause (b) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at such date and time as shall have been selected by the Bank and the Borrower. If the Benchmark Replacement is Adjusted Daily Simple SOFR, all interest payments will be payable on a quarterly basis.
(ii) Upon the occurrence of a Benchmark Transition Event, the Benchmark Replacement will replace the then-current Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Borrower without any amendment to this Credit Agreement or any other Loan Document, or further action or consent of the Borrower. At any time that the administrator of the then-current Benchmark has permanently or indefinitely ceased to provide such Benchmark or such Benchmark has been announced by the regulatory supervisor
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for the administrator of such Benchmark pursuant to public statement or publication of information to be no longer representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not be restored, the Borrower may revoke any request for a borrowing of, conversion to or continuation of Loans to be made, converted or continued that would bear interest by reference to such Benchmark until the Borrower’s receipt of notice from the Lender that a Benchmark Replacement has replaced such Benchmark, and, failing that, the Borrower will be deemed to have converted any such request into a request for a borrowing of or conversion to ABR Loans. During the period referenced in the foregoing sentence, the component of the Alternate Base Rate based upon the Benchmark will not be used in any determination of the Alternate Base Rate.
(b) (iii) Benchmark Replacement Conforming Changes. In connection with the implementation anduse, administration, adoption or implementation of a Benchmark Replacement, the Bank will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Credit Agreement or any other Loan Document.
(c) (iv)Notices; Standards for Decisions and Determinations. The Bank will promptly notify the Borrower of (i) the implementation of any Benchmark Replacement and (ii) the effectiveness of any Benchmark Replacement Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. The Bank will notify the Borrower of (x) the removal or reinstatement of any tenor of a Benchmark pursuant to Section 3.5(d) and (y) the commencement of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Bank pursuant to this Section 3.5, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party heretoto this Credit Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section. The Bank does not warrant or accept any responsibility for, and shall not have any liability with respect to, (i) the continuation of, administration of, submission of, calculation of or any other matter related to USD LIBOR or any Benchmark, any component definition thereof or rates referenced in the definition thereof or with respect to any alternative, successor or replacement rate thereto (including any then-current Benchmark or any Benchmark Replacement), including whether the composition or characteristics of any such alternative, successor or replacement rate (including any Benchmark Replacement), as it may or may not be adjusted pursuant to this Section, will be similar to, or produce the same value or economic equivalence of, or have the same volume or liquidity as, such Benchmark or any other Benchmark prior to its discontinuance or unavailability, or (ii) the effect, implementation or composition of any Benchmark Replacement Conforming Changes. 3.5.
(d) (v) At Unavailability of Tenor of Benchmark. Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including the Term SOFR or USD LIBOR)Reference Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Bank in its reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is not or will not be representative, then the Bank may remove any tenor of such Benchmark that ismodify the definition of “Interest Period” (or any similar or analogous definition) for any Benchmark settings at or after such time to remove such unavailable or non-representative for Benchmark (including Benchmark Replacement) settings and (ii) the Bank may tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is not or will not be representative for a Benchmark (including a Benchmark Replacement), then the Bank may modify the definition of “Interest Period” (or any similar or analogous definition) for all Benchmark settings at or after such time to reinstate any such previously removed tenor for Benchmark (including Benchmark Replacement) settings.
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(e) Benchmark Unavailability Period. Upon the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period with respect to the Term SOFR Reference Rate, Adjusted Term SOFR, or Term SOFR, or the Benchmark Replacement for any of them, (x) the Borrower may revoke any pending request for a borrowing of, conversion to or continuation of Term SOFR Loans of the affected type to be made, converted or continued during such Benchmark Unavailability Period and, failing that, the Borrower will be deemed to have converted any such request into a request for a borrowing of or conversion to ABR Loans and (y) any outstanding Term SOFR Loans of the affected type will be deemed to have been converted to ABR Loans (1) at the end of the applicable Interest Period, in the case of TS Loans, or (2) immediately, in the case of Overnight Loans.
3.6 Other LIBOR ProvisionsIllegality
If the Bank determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for the Bank or its applicable lending office to make, maintain or fund Loans whose interest is determined by reference to SOFR, the Term SOFR Reference Rate, Adjusted Term SOFR or Term SOFR, or to determine or charge interest based upon SOFR, the Term SOFR Reference Rate, Adjusted Term SOFR or Term SOFR, then, upon notice thereof by the Bank to the Borrower (an “Illegality Notice”), (a) any obligation of the Bank to make Term SOFR Loans, and any right of the Borrower to continue Term SOFR Loans or to convert Loans to Term SOFR Loans, shall be suspended, and (b) the interest rate on which ABR Loans shall, if necessary to avoid such illegality, be determined by the Bank without reference to clause (c) of the definition of “ABR”, in each case until the Bank notifies the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of an Illegality Notice, the Borrower shall, if necessary to avoid such illegality, upon demand from the Bank, prepay or, if applicable, convert all Term SOFR Loans to ABR Loans (the interest rate on which ABR Loans shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to clause (c) of the definition of “ABR”), (i) in the case of TS Loans, on the last day of the Interest Period therefor, if the Bank may lawfully continue to maintain such TS Loans to such day, or immediately, if the Bank may not lawfully continue to maintain such TS Loans to such day, or (ii) in the case of Overnight Loans, immediately, in each case until the Bank determines it is no longer illegal for the Bank to determine or charge interest rates based upon SOFR, the Term SOFR Reference Rate, Adjusted Term SOFR or Term SOFR. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted, together with any additional amounts required pursuant to Section 3.7.
Notwithstanding any other provision hereof, if any Change in Law shall make it unlawful for the Bank to make, continue or maintain any LIBOR Loan, to convert any other Loan to a LIBOR Loan, or to give effect to its obligations as contemplated hereby with respect to any LIBOR Loan, then, by written notice to the Borrower:
(a) the Bank may, if such Change in Law makes it unlawful to make, continue or maintain, or convert any Loan to, a LIBOR Loan, declare that thereafter (for the duration of such unlawfulness) LIBOR Loans will not be made or continued, and Loans will not be converted into LIBOR Loans; and
(b) the Bank may, if such Change in Law makes it unlawful to maintain LIBOR Loans, require that all outstanding LIBOR Loans be converted to ABR Loans, in which event all such LIBOR Loans shall be automatically converted to ABR Loans on the last day of the Interest Period applicable thereto or such earlier date if required by any Change in Law.
3.7 Break Funding Payments
(a) LIBOR Loans. In the event of (i) the payment or prepayment (voluntary or otherwise) of any principal of any LIBORFixed Rate Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (ii) the failure to borrow or continue any LIBORTS Loan, or convert any Variable Rate Loan to a LIBORTS Loan, on the date specified in any notice delivered pursuant hereto, or (iii) the conversion of any LIBORFixed Rate Loan to an ABR Loan pursuant to Section 3.6(b), then, in any such event, the Borrower shall compensate the Bank for the loss, cost and expense attributable to such event. Such loss, cost or expense shall be deemed to include an amount determined by the Bank to be the excess, if any, of (x) the amount of interest that would have accrued on the principal amount of such LIBORFixed Rate Loan had such event not occurred, at the Adjusted LIBO Raterate that would have been applicable to such LIBORFixed Rate Loan, for the period from the
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date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such LIBORFixed Rate Loan), over (y) the amount of interest that would accrue on such principal amount for such period at the interest rate that the Bank would bid were it to bid, at the commencement of such period, for deposits in Dollars of a comparable amount and period from other banks in the London interbank marketmoney markets. A certificate of the Bank setting forth any amount or amounts that the Bank is entitled to receive pursuant to this Section 3.7(b) and the calculation thereof in reasonable detail shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay the Bank the amount shown as due on any such certificate within 10 days after receipt thereof.
(b) Fixed Rate Loans. In the event that (i) the Borrower shall have accepted the Bank’s offer of a Fixed Rate with respect to a particular proposed Fixed Rate Loan, and such Fixed Rate Loan was not made because either (x) the Borrower rejected such Fixed Rate Loan or the proceeds thereof, or (y) such Fixed Rate Loan was not advanced by the Bank because any condition precedent therefor set forth in Article V was not satisfied, or (b) for any reason any Fixed Rate Loan shall have been, prior to the end of the Fixed Period therefor, either repaid, prepaid or converted to a Variable Rate Loan (including, without limitation, as a result of the acceleration thereof in accordance with Section 8.2), then in any such case referred to in clause (i) or clause (ii) above (each a “Breakage Event”), the Bank shall promptly (and in any event within ten (10) Business Days thereafter) (A) determine the Fixed Rate Breakage Amount arising out of such Breakage Event, and (B) deliver a certificate thereof to the Borrower stating such Fixed Breakage Amount. In the event such Fixed Rate Breakage Amount is a positive number, such Fixed Rate Breakage Amount shall be paid to the Borrower by the Bank within two (2) Business Days after the delivery of such certificate to the Borrower. In the event such Fixed Rate Breakage Amount is a negative number, such Fixed Rate Breakage Amount shall be paid to the Bank by the Borrower within two (2) Business Days after the delivery of such certificate to the Borrower.
3.8 Inability to Determine Rates
(a) Subject to Section 3.5, if, on or prior to the making of any Term SOFR Loan:
(i) the Bank determines (which determination shall be conclusive and binding absent manifest error) that reasonable and adequate means do not exist for determining “Adjusted Term SOFR” pursuant to the definition thereof, or
(ii) the Bank determines that for any reason in connection with any request for such Term SOFR Loan or a conversion thereto or a continuation thereof that Adjusted Term SOFR with respect to a proposed Term SOFR Loan does not adequately and fairly reflect the cost to the Bank of making and maintaining such Term SOFR Loan, the Bank will promptly so notify the Borrower and, upon notice thereof by the Bank to the Borrower, any obligation of the Bank to make such Term SOFR Loans, and any right of the Borrower to continue Term SOFR Loans or to convert ABR Loans to Term SOFR Loans, shall be suspended (to the extent of the affected Term SOFR Loans) until the Bank revokes such notice. Upon receipt of such notice, (i) the Borrower may revoke any pending request for a borrowing of, conversion to or continuation of Term SOFR Loans (to the extent of the affected Term SOFR Loans) or, failing that, the Borrower will be deemed to have converted any such request into a request for a borrowing of or conversion to an ABR Loan in the amount specified therein and (ii) any outstanding affected Term SOFR Loans will be deemed to have been converted into ABR Loans at the end of the applicable Interest Period, in the case of TS Loans, or immediately, in the case of Overnight Loans. Upon any such conversion, the Borrower shall also pay accrued interest on the amount so converted, together with any additional amounts required pursuant to Section 3.7.
(b) If the Bank determines (which determination shall be conclusive and binding absent manifest error) that “Daily Simple SOFR” or “Adjusted Daily Simple SOFR” cannot be determined pursuant to the definition thereof on any given day, the interest rate on ABR Loans shall be determined by the Bank without reference to clause (c) of the definition of “Alternate Base Rate” until the Bank revokes such determination.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce the Bank to enter into this Credit Agreement and make the Loans, the Borrower makes the following representations and warranties to the Bank:
4.1 Organization and Power
The Borrower (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and (b) is duly qualified to do business and in good standing in each jurisdiction in which the failure to be so qualified could reasonably be expected to have a Material Adverse Effect. The Borrower has all requisite power and authority to own its property and to carry on its business as now conducted.
4.2 Authority and Execution
The Borrower has full legal power and authority to enter into, execute, deliver and perform the terms of the Loan Documents to which it is a party, all of which have been duly authorized by all proper and necessary action, and the Borrower is in full compliance with its Organization Documents. The Borrower has duly executed and delivered the Loan Documents to which it is a party.
4.3 Binding Agreement
The Loan Documents constitute the valid and legally binding obligations of the Borrower to the extent it is a party thereto, enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights generally.
4.4 Litigation
There are no actions, suits or proceedings at law or in equity or by or before any Governmental Authority (whether purportedly on behalf of the Borrower) pending or, to the knowledge of the Borrower, threatened against it or maintained by it that may affect the property or rights of the Borrower, which (a) call into question the validity or enforceability of, or otherwise seek to invalidate, any Loan Document, or (b) would, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
4.5 Approvals and Consents
No consent, authorization or approval of, filing (other than the filing of each financing statement in the form attached to the Security Agreement in the office indicated on such financing statement) with, notice to, or exemption by, the holders of any securities issued by the Borrower, any Governmental Authority or any other Person is required to authorize, or is required in connection with, the execution and delivery by the Borrower of, and the performance by the Borrower of its obligations under, the Loan Documents to which it is a party or is required as a condition to the validity or enforceability of the Loan Documents to which it is a party with respect to or against the Borrower or its property or assets. No provision of any applicable treaty, statute, law (including any applicable usury or similar law), rule or regulation of any Governmental Authority will prevent the execution and delivery by the Borrower or performance by the Borrower of its obligations under, or affect the validity with respect to or against the Borrower of, the Loan Documents to which it is a party.
4.6 No Conflict
The Borrower is not in default under any mortgage, indenture, contract, agreement, judgment, decree or order to which it is a party or by which it or any of its property is bound, which defaults, taken as a whole, could reasonably be expected to have a Material Adverse Effect. The execution, delivery or carrying out by the Borrower of the terms of the Loan Documents to which it is a party, the Loans hereunder and the use by the Borrower of the proceeds thereof (a) will not (i) violate any statutes or regulations, including the ICA, of any Governmental Authority applicable to the Borrower or (ii) constitute a default under, conflict with, require any consent under (other than consents which have been obtained), or result in the creation or imposition of, or obligation to create, any Lien (other than pursuant to the Loan Documents) upon the property of the Borrower pursuant to the terms of any such mortgage, indenture, contract, agreement, judgment, decree or order, which defaults, conflicts and consents, if not obtained, could reasonably be expected to have a Material Adverse Effect, and (b) are not inconsistent with the Fundamental Policies.
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4.7 Taxes
The Borrower has filed or caused to be filed all tax returns required to be filed and has paid, or has made adequate provision for the payment of, all Taxes shown to be due and payable on said returns or in any assessments made against it (other than those being contested in good faith and by appropriate proceedings diligently conducted, and for which adequate reserves have been set aside in accordance with Applicable Accounting Principles) which, if not so filed or paid, could reasonably be expected to result in a Material Adverse Effect, and no tax Liens have been filed against the Borrower or any of its property. The charges, accruals and reserves on the books of the Borrower with respect to all federal, state, local and other Taxes are adequate, and the Borrower knows of no unpaid assessment which is due and payable against or any claims being asserted against it which could reasonably be expected to have a Material Adverse Effect, except such thereof as are being contested in good faith and by appropriate proceedings diligently conducted, and for which adequate reserves have been set aside in accordance with Applicable Accounting Principles.
4.8 Compliance
The Borrower is not in default with respect to any judgment, order, writ, injunction, decree or decision of any Governmental Authority, which default could reasonably be expected to have a Material Adverse Effect. The Borrower is complying in all respects with all applicable statutes and regulations, including the ICA and the Securities Act, and of all Governmental Authorities, a violation of which could reasonably be expected to have a Material Adverse Effect.
4.9 Property
The Borrower has good and marketable title to all of its property with respect to which the absence of such marketable title could reasonably be expected to result in a Material Adverse Effect, subject to no Liens other than Permitted Liens.
4.10 Federal Reserve Regulations; Use of Loan Proceeds
Except for the Federal Reserve Form to be executed and delivered by the Borrower, no filing or other action is required under the provisions of Regulations T, U or X in connection with the execution and delivery by the Borrower of this Credit Agreement and neither the making of any Loan in accordance with this Credit Agreement nor the use of the proceeds thereof, will violate or be inconsistent with the provisions of Regulations T, U or X.
4.11 No Material Adverse Effect
Since the Measurement Date, the Borrower has conducted its businesses only in the ordinary course and there has been no event or occurrence that has resulted in a Material Adverse Effect.
4.12 Material Agreements
Each of the following is in full force and effect: (a) the investment advisory agreement between the Borrower and its Investment Adviser, (b) the Custody Agreement, and (c) the administration agreement between the Borrower and the administrator therefor.
4.13 Financial Condition
The statement of assets and liabilities of the Borrower as of the Measurement Date and the related statements of operations and changes in net assets for the fiscal year then ended, copies of which, certified by independent public accountants, have heretofore been delivered to the Bank, fairly present, in all material respects, the financial position of the Borrower as of such date and the results of its operations for such period in conformity with Applicable Accounting Principles.
4.14 No Misrepresentation
No representation or warranty contained in any Loan Document and no certificate or report from time to time furnished by the Borrower to the Bank in connection with the transactions contemplated thereby, contains or will contain a misstatement of material fact, or, to the best knowledge of the Borrower, omits or will omit to state a material fact required to be stated in order to make the statements therein contained not misleading in the light of the circumstances under which made.
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4.15 Sanctions, Etc.
(a) None of the Borrower, any of its subsidiaries or any director, officer, or, to Borrower’s knowledge, employee, agent, or affiliate of the Borrower (other than another portfolio company of the Investment Adviser) or any of its subsidiaries is a Person that is, or is owned or controlled by Persons that are: (i) the subject or target of any sanctions administered or enforced by OFAC, the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), or (ii) located, organized or resident in a country, region or territory that is, or whose government is, the subject of Sanctions, including, without limitation, Cuba, Iran, North Korea, Crimea and Syria.
(b) No Affected Person or any Person that controls (directly or indirectly) the Borrower, or any Person that receives (directly or indirectly) any proceeds of any Loan (i) conducts any business or engages in making or receiving any contribution of goods, services or money to or for the benefit of any Sanctioned Person or in any Sanctioned Jurisdiction, (ii) deals in, or otherwise engages in any transaction related to, any property or interests in property blocked pursuant to any Anti-Terrorism Law, (iii) engages in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law, or (iv) has violated any Anti-Terrorism Law.
(c) No Affected Person or any Person that controls (directly or indirectly) the Borrower, or any Person that receives (directly or indirectly) any proceeds of any Loan (i) has engaged in any transaction, investment, undertaking or activity that conceals the identity, source or destination of the proceeds from any category of prohibited offenses designated by the Organization for Economic Co-operation and Development’s Financial Action Task Force on Money Laundering, or (ii) otherwise violated any applicable law regarding money laundering in any material respect.
(d) The Borrower and each subsidiary thereof is in material compliance with the FCPA, and each foreign counterpart thereof. Neither the Borrower nor any subsidiary thereof has made a payment, offering, or promise to pay, or authorized the payment of, money or anything of value (i) in order to assist in obtaining or retaining business for or with, or directing business to, any foreign official, foreign political party, party official or candidate for foreign political office, (ii) to a foreign official, foreign political party or party official or any candidate for foreign political office, and (iii) with the intent to induce the recipient to misuse his or her official position to direct business wrongfully to the Borrower or any other Person in violation of the FCPA.
(e) The Borrower and each Subsidiary thereof has implemented and maintains, and is in compliance with, policies and procedures designed to promote and achieve compliance by each Affected Person with all applicable laws regarding Sanctions and money laundering, Anti-Terrorism Laws and Anti-Corruption Laws.
4.16 Investment Company Status
(a) The Borrower has the following status (“Status”): (i) it qualifies as a Regulated Investment Company, (ii) it is a “registered investment company” within the meaning of Section 8 of the ICA, (iii) it is a “closed-end company” and a “non-diversified company” in each case within the meaning of Section 5 of the ICA, (iv) it is not a “business development company” within the meaning of Section 2(a)(48) of the ICA, (v) it is neither an “affiliate” (within the meaning of Section 23A of the Federal Reserve Act) of, nor an “affiliated person” (as defined in Section 2(a)(3) of the ICA) of, the Bank, (vi) it is not an Indirect Fund, (vii) it has only one series of capital stock, (viii) it is in compliance with the Fundamental Policies, (ix) it is not in violation of Rule 18f-4, and (x) it is not a party to any inter-fund lending arrangement.
(b) The Borrower is not subject to any statute, rule, regulation or organizational or offering document which prohibits or limits the incurrence of Indebtedness under the Loan Documents, except for the limitations set forth in the ICA, state securities laws to the extent applicable, and the Fundamental Policies.
(c) The Borrower has not issued any of its securities in violation of any Federal or State securities laws applicable thereto, except to the extent that any such violation could not reasonably be expected to have a Material Adverse Effect.
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4.17 ERISA
The Borrower (a) is not, and has not been in the last five (5) years, a member of an ERISA Group, and (b) has no liability in respect of any Benefit Arrangement, Plan or Multiemployer Plan subject to ERISA. None of the following (individually or collectively) constitute a “prohibited transaction” within the meaning of Section 406 of ERISA or Section 4975 of the Code for which an exemption is not available: (i) the execution and delivery of the Loan Documents, (ii) the incurrence of any obligation under the Loan Documents, (iii) the making of any Loan, (iv) the payment by the Borrower of any principal, interest, fee or other sum owing under the Loan Documents, or (v) the consummation of any other transaction contemplated by the Loan Documents.
ARTICLE V
CONDITIONS
5.1 Effective Date
The obligation of the Bank to make Loans hereunder shall not become effective until the date (the “Effective Date”) on which each of the following conditions is satisfied, or waived in accordance with Section 9.2 (and the Bank shall notify the Borrower of the Effective Date, and such notice shall be conclusive and binding):
(a) The Bank shall have received either (i) a counterpart of this Credit Agreement signed on behalf of the Borrower or (ii) written evidence satisfactory to the Bank (which may include facsimile transmission of a signed signature page of this Credit Agreement) that the Borrower has signed a counterpart of this Credit Agreement.
(b) If the Bank shall have requested one, the Bank shall have received a Note, dated the Effective Date, executed on behalf of the Borrower.
(c) The Bank shall have received a favorable written opinion (addressed to the Bank and dated the Effective Date) from external legal counsel to the Borrower acceptable to the Bank, the substance of which is set forth in Exhibit B. The Borrower hereby requests such counsel to deliver such opinion.
(d) The Bank shall have received a certificate, dated the Effective Date and signed by authorized representatives of the Borrower, substantially in the form of Exhibit D hereto, and in all other respects satisfactory to the Bank.
(e) The Bank shall have received a copy of an initial Federal Reserve Form, substantially in the form of Exhibit E hereto, duly executed and delivered by or on behalf of the Borrower, in form and substance acceptable to the Bank.
(f) The Bank shall have received a security agreement, dated the Effective Date and signed by an authorized representative on behalf of the Borrower, substantially in the form of Exhibit G hereto (the “Security Agreement”).
(g) The Bank shall have received a control agreement, dated the Effective Date and signed by the Custodian and an authorized representative on behalf of the Borrower, substantially in the form of Exhibit H hereto (the “Control Agreement”).
(h) The Bank shall have received Uniform Commercial Code, federal tax and judgment lien search reports with respect to each applicable public office where Liens would customarily be filed against the Borrower disclosing that there are no Liens of record in such official’s office covering the Borrower or any asset or property thereof.
(i) Prior to or simultaneously with the Effective Date, (i) the Borrower shall have paid all principal, interest and other sums owing (whether or not then due) by the Borrower under the U.S. PB Agreement, dated September 25, 2014, between the Borrower and BNP Paribas Prime Brokerage, Inc. (the “Existing Lender”) and all other term annexes, agreements, instruments and other documents executed or delivered in connection therewith (collectively, the “Existing Credit Documents”), (ii) the Existing Credit Documents shall have been terminated (other than provisions thereof which, by their terms, provide that they survive any such termination), and all commitments under the Existing Credit Documents to make loans or otherwise extend credit to or for the account of the Borrower
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shall have been cancelled or terminated, (iii) all Liens on the property of the Borrower securing the obligations under the Existing Credit Documents shall have been released or otherwise terminated, and (iv) the Bank shall have received satisfactory evidence of all of the foregoing.
(j) The Bank shall have received all fees and other amounts due and payable by the Borrower on or prior to the Effective Date, including, to the extent invoiced, reimbursement or payment of all reasonable out-of-pocket costs and expenses required to be reimbursed or paid by the Borrower hereunder.
5.2 Each Credit Event
The obligation of the Bank to make any Loan is subject to the satisfaction of the following conditions:
(a) The representations and warranties of the Borrower set forth in each Loan Document to which it is a party shall be true and correct in all respects on and as of the date of such Loan (other than, as to any such representation or warranty that by its terms refers to a specific date, in which case such representation and warranty shall be true and correct in all respects as of such specified date), and immediately before and after giving effect to such Loan and the use of the proceeds thereof no Default shall have occurred and be continuing.
(b) The Bank shall have received (i) in connection with a Variable Rate Loan, a Written Variablewritten Borrowing Request signed by the Borrower setting forth the information required by Section 2.2(a), or (ii) in connection with a Fixed Rate Loan, a Written Fixed Borrowing Request signed by the Borrower setting forth the information required by Section 2.3(a), and the Borrower’s acceptance of the Fixed Rate for such Fixed Rate Loan in accordance with Section 2.3(a)..
(c) To the extent required by Regulation U, the Bank shall have received (i) a copy of a Federal Reserve Form, duly executed and delivered by the Borrower and completed for delivery to the Bank, in form acceptable to the Bank, or (ii) a current list of Margin Stock and Non-Margin Assets of the Borrower, in a form acceptable to the Bank and in all respects in compliance with Regulation U, including Section 221.3(c)(2)(iv) thereof.
Each request for a Loan by the Borrower shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in paragraph (a) of this Section.
ARTICLE VI
AFFIRMATIVE COVENANTS
Until the Commitment has expired or been terminated and the principal of and interest on each Loan and all fees and other amounts payable by the Borrower under the Loan Documents shall have been paid in full, the Borrower covenants and agrees with the Bank that:
6.1 Financial Statements and Other Information
The Borrower shall, subject to the last paragraph of this Section, furnish or cause to be furnished to the Bank:
(a) as soon as available, but in any event within 90 days after the end of each fiscal year of the Borrower, a copy of its statement of assets and liabilities as at the end of such fiscal year, together with the related schedule of investments and statements of operations and changes in net assets as of and through the end of such fiscal year; each such statement of assets and liabilities and the related schedule of investments and statements of operations and changes in net assets shall be certified without qualification by independent public accountants, which certification shall (i) state that the examination by such independent public accountants in connection with such financial statements has been made in accordance with those auditing standards required by the ICA and prescribed by the SEC for the Borrower or, to the extent not so required or prescribed, generally accepted auditing standards in the United States and (ii) include the opinion of such independent public accountants that such financial statements have been prepared in conformity with Applicable Accounting Principles, except as otherwise specified in such opinion;
(b) as soon as available, but in any event within 90 days after the end of the first semiannual accounting period in each fiscal year of the Borrower, a copy of the Borrower’s statement of assets and liabilities as at the end of such semiannual period, together with the related schedule of investments and statements of operations and changes in net assets for such period;
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(c) [Reserved;]
(d) as soon as available, but in any event not later than three (3) Business Days after the end of each calendar month, a duly completed certificate of a duly authorized representative of the Borrower, substantially in the form of Exhibit F hereto;
(e) prompt written notice of any contest referred to in Sections 6.5 or 6.6;
(f) promptly after the execution thereof, copies of all material amendments or other material changes to the Fundamental Policies, all investment advisory contracts, and any new investment advisory contracts entered into after the Effective Date;
(g) prompt written notice in the event that the Board decides to seek the approval of Borrower’s shareholders to effect a change in any of Borrower’s Fundamental Policies; and
(h) promptly after request therefor, such other information as the Bank may reasonably request from time to time (including, without limitation, in order to comply with “know-your-customer” and other anti-terrorism, anti-money laundering and similar rules and regulations and related policies).
Borrower shall not be required pursuant to Sections 6.1(a), (b) or (c) to deliver or otherwise provide any information to the Bank to the extent such information is readily available through the U.S. Securities and Exchange Commission’s EDGAR system or on the www.tortoiseadvisors.com website within the time period provided in such Section. Borrower shall not be required pursuant to Section 6.1(e), (f), or (g) to deliver or otherwise provide any information to the Bank to the extent such information is (i) readily available through the U.S. Securities and Exchange Commission’s EDGAR system or on the www.tortoiseadvisors.com website, and (ii) Borrower has notified the Bank that such information is available and where such information may be found.
6.2 Notice of Material Events
The Borrower shall furnish or cause to be furnished to the Bank prompt written notice of the following, together with a statement of a duly authorized representative (who shall be acceptable to the Bank) of the Borrower setting forth in reasonable detail the event or development requiring such notice and, if applicable, any action taken or proposed to be taken with respect thereto:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by or before any Governmental Authority against or affecting the Borrower that could in the good faith opinion of the Borrower reasonably be expected to result in a Material Adverse Effect; and
(c) the occurrence of any other development that has resulted, or could reasonably be expected to result, in a Material Adverse Effect.
6.3 Legal Existence
The Borrower shall maintain its legal existence in good standing in the jurisdiction of its organization and shall maintain its qualification to do business in each other jurisdiction in which the failure so to do could reasonably be expected to have a Material Adverse Effect.
6.4 Insurance
The Borrower shall maintain insurance with financially sound insurance carriers in at least such amounts and against at least such risks as are customarily insured against by entities engaged in the same or a similar business or as may otherwise be required by the ICA or the SEC (including such fidelity bond coverage as shall be required by Rule 17g-1 promulgated under the ICA or any successor provision and errors and omissions insurance); and furnish to the Bank, upon written request, full information as to the insurance carried.
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6.5 Payment of Indebtedness and Performance of Obligations
The Borrower shall pay and discharge when due all lawful Indebtedness, obligations and claims for labor, materials and supplies or otherwise which, if unpaid, could reasonably be expected to (a) have a Material Adverse Effect on the Borrower or (b) give rise to the imposition of a Lien (other than a Permitted Lien) upon the property of the Borrower, unless and to the extent only that the validity of such Indebtedness, obligation or claim shall be contested in good faith and by appropriate proceedings diligently conducted by or on behalf of the Borrower, and provided that such reserve or other appropriate provision as shall be required in accordance with Applicable Accounting Principles shall have been made therefor.
6.6 Observance of Legal Requirements
The Borrower shall observe and comply in all material respects with all laws (including the ICA and the Code), ordinances, orders, judgments, rules, regulations, certifications, franchises, permits, licenses, directions and requirements of all Governmental Authorities, which may then be applicable to the Borrower, a violation of which could reasonably be expected to have a Material Adverse Effect, except such thereof as shall be contested in good faith and by appropriate proceedings diligently conducted by or on behalf of the Borrower, provided that such reserve or other appropriate provision as shall be required in accordance with Applicable Accounting Principles shall have been made therefor.
6.7 Books and Records; Visitation
The Borrower shall (a) keep proper books of record and account in which complete, true and correct entries in conformity with Applicable Accounting Principles and all material requirements of law shall be made of all material dealings and transactions in relation to its business and activities, (b) upon reasonable prior notice (which shall in no event be required to be more than (i) one Business Day prior, at any time that a Default has occurred and is continuing, or (ii) five Business Days prior, at all other times) permit representatives of the Bank to visit the offices of the Borrower and to discuss the properties, assets, income and financial condition of the Borrower with the duly authorized representatives thereof and to inspect the books, property and records of the Borrower, and (c) upon the reasonable request of the Bank, deliver to the Bank a detailed list of assets of the Borrower.
6.8 Purpose of Loans
The Borrower shall use the proceeds of each Loan for its general business purposes, including the purchase of investment securities, provided that in no event shall (a) the proceeds of any Loan be used for purposes which would violate any provision of any applicable statute, rule, regulation, order or restriction applicable to the Borrower or Regulation U or (b) the Borrower use the proceeds of any Loan for anything other than its general corporate or working capital purposes.
6.9 Maintenance of Status
The Borrower will maintain at all times its Status.
ARTICLE VII
NEGATIVE COVENANTS
Until the Commitment has expired or been terminated and the principal of and interest on each Loan and all fees and other amounts payable by the Borrower under the Loan Documents shall have been paid in full, the Borrower covenants and agrees with the Bank that:
7.1 Indebtedness; Senior Securities
(a) The Borrower will not create, incur, assume or suffer to exist any liability for Indebtedness, except:
(i) Indebtedness under the Loan Documents,
(ii) Indebtedness (other than Indebtedness for borrowed money) constituting Financial Contract Liabilities (1) incurred in the ordinary course of business, (2) permitted to be incurred in accordance with the Fundamental Policies, and (3) which, immediately after giving effect thereto and any simultaneous repayment of any other Indebtedness, would not cause the Borrower to be in Default under Section 7.7, and
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(iii) Indebtedness to the Custodian (1) incurred for the purposes of clearing and settling purchases and sales of securities, or (2) up to an aggregate amount not to exceed the lesser of (x) 1.0% of the aggregate Net Asset Value of the Borrower and (y) $3,000,000 at any one time outstanding under this clause (2), for temporary or emergency purposes.
(b) The Borrower will not issue, sell, create, incur, assume or suffer to exist any Senior Security, except Senior Securities Representing Indebtedness permitted by Section 7.1(a).
7.2 Liens
The Borrower will not create, incur, assume or suffer to exist any Lien upon any of its property or assets, whether now owned or hereafter acquired, except:
(a) Liens for Taxes, assessments or similar charges incurred in the ordinary course of business for which adequate reserves have been set aside in accordance with Applicable Accounting Principles and which (i) are not delinquent, or (ii) are being contested in good faith and by appropriate proceedings diligently conducted, provided that enforcement of such Liens is stayed pending such contest;
(b) Liens imposed by law created in the ordinary course of business for which adequate reserves have been set aside in accordance with Applicable Accounting Principles (i) securing amounts not yet due, or (ii) which are being contested in good faith and by appropriate proceedings diligently conducted, provided that enforcement of such Liens is stayed pending such contest;
(c) Liens arising out of judgments or decrees affecting the property attributable to the Borrower for which adequate reserves have been set aside in accordance with Applicable Accounting Principles and which are being contested in good faith and by appropriate proceedings diligently conducted, provided that enforcement thereof is stayed pending such contest;
(d) Liens created or arising under the Loan Documents;
(e) (i) Liens arising under the Custody Agreement and securing obligations (other than Indebtedness) of the Borrower thereunder, to the extent such obligations arose in the ordinary course of business and are permitted by the Control Agreement, and (ii) Liens arising under the Custody Agreement and securing Indebtedness of the Borrower thereunder to the extent such Indebtedness is permitted by Section 7.1 and by the Control Agreement; and
(f) Liens in respect of obligations arising from any Financial Contract, provided that each such obligation is incurred in the ordinary course of business and in accordance with the Fundamental Policies.
7.3 Fundamental Changes
The Borrower will not (a) divide or consolidate or merge into or with any Person, or (b) in any single transaction or series of related transactions, sell, lease or otherwise transfer, directly or indirectly, all or substantially all of its property.
7.4 Restricted Payments
The Borrower will not declare, make or otherwise pay, or allow to be declared, made or otherwise paid, any Restricted Payment if (i) an Event of Default then exists or would result therefrom, and (ii) any Loan is then outstanding.
7.5 Fundamental Policies; Valuation
The Borrower will not (a) make or maintain any Investment other than as permitted by the ICA and the Fundamental Policies, (b) amend or otherwise modify the Fundamental Policies, or (c) for purposes of the Loan Documents or financial reporting, value any Investment or other property thereof other than in accordance with applicable law (including the ICA) and the Offering Document.
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7.6 Amendments and Changes
(a) The Borrower will not amend or otherwise modify its Organization Documents or the Custody Agreement, in each case in any way which would adversely affect the rights or remedies of the Bank under the Loan Documents.
(b) The Borrower will not change its fiscal year if such change would have a Material Adverse Effect. Subject to Section 1.3, the Borrower will not change or permit any change in the accounting principles applied to it, except as required by Applicable Accounting Principles, if such change would have a Material Adverse Effect.
7.7 Financial Covenants
(a) The Borrower will not permit the Adjusted Asset Coverage to be less than 3.00:1.00 at any time that one or more Loans or any principal thereof is outstanding.
(b) The Borrower shall not at any time permit (i) Senior Debt to exceed the maximum amount of Senior Debt that would be permitted to be incurred by or for the account of the Borrower under its Fundamental Policies, (ii) Senior Debt to exceed the maximum amount of Senior Debt that would be permitted to be incurred by or for the account of the Borrower on such date under the ICA or other applicable law, or (iii) its Indebtedness to exceed the sum of (A) 50% of (x) the Maximum Borrowing Value of the Borrower’s Margin Stock minus (y) all Ordinary Liabilities to the extent not in excess of the amount determined under clause (x) immediately above, plus (B) the excess, if any, of (x) the Maximum Borrowing Value of the Borrower’s Non-Margin Assets over (y) all Ordinary Liabilities to the extent in excess of the amount determined under clause (A)(x) immediately above.
7.8 Investment
(a) The Borrower will not purchase, acquire, or otherwise have exposure to, any Investment, other than Permitted Investments.
(b) The Borrower will not enter into or otherwise acquire or hold any Financial Contract (i) unless (1) the collateral, if any, received or receivable by the Borrower in connection therewith is solely in the form of cash or short-term U.S. treasury securities, and (2) each counterparty thereto or issuer thereof has a minimum senior unsecured unenhanced long term debt rating of at least A- by S&P (or the equivalent rating of another independent rating agency (other than Moody’s) if not so rated by S&P) and at least A3 by Moody’s (or the equivalent rating of another independent rating agency (other than S&P) if not so rated by Moody’s), or (ii) in any case for the purpose of creating or continuing leverage.
7.9 Sanctions, Etc.
(a) The Borrower will not, directly or indirectly, use the proceeds of the Loans, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person, (i) to fund, finance or facilitate any activities or business of or with any Person, or in any country, region or territory, that, at the time, is, or whose government is, the subject of Sanctions, or (ii) in any other manner that would result in a violation of Sanctions by any Person (including any Person participating in the Loans, whether as underwriter, lender, advisor, investor, or otherwise).
(b) The Borrower will not, and will not cause or permit any subsidiary thereof to, violate any applicable law, rule or regulation regarding Sanctions or money laundering, or any Anti-Terrorism Law or Anti-Corruption Law.
(c) The Borrower and each subsidiary thereof shall at all times maintain, and be in compliance with, policies and procedures designed to promote and achieve compliance by each Affected Person with all applicable laws, rules and regulations regarding Sanctions and money laundering, Anti-Terrorism Laws and Anti-Corruption Laws.
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ARTICLE VIII
EVENTS OF DEFAULT
8.1 Events of Default
Each of the following shall constitute an “Event of Default”:
(a) any principal of any Loan shall not be paid when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;
(b) any interest on any Loan or any fee, commission or any other amount (other than an amount referred to in paragraph (a) of this Section 8.1) payable under any Loan Document shall not be paid when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three Business Days;
(c) any representation, warranty or certification made or deemed made by or on behalf of the Borrower in or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, shall prove to have been incorrect in any material respect when made or deemed made;
(d) (i) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 7.7(a) and such failure shall continue unremedied for a period of twenty consecutive days, (ii) the Adjusted Asset Coverage shall be less than 2.50:1.00 at any time, or (iii) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Sections 6.1 (a), (b), (c), or (d) or 6.3, 6.8 or 6.9 or in Article 7 (other than Section 7.7(a));
(e) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in this Credit Agreement (other than those specified in paragraphs (a), (b) or (d) of this Section 8.1), and such failure shall continue unremedied for a period of 30 days after the Borrower shall, or reasonably should, have obtained knowledge thereof;
(f) the Borrower shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness when and as the same shall become due and payable (after giving effect to any applicable grace period or notice requirement);
(g) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits the holder or holders of any such Material Indebtedness or any trustee or agent on its or their behalf to cause any such Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity, provided that this paragraph (g) shall not apply to secured Indebtedness that becomes due solely as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower, or the debts of the Borrower, or of a substantial part of its assets, under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or for a substantial part of the assets of the Borrower; and, in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;
(i) the Borrower shall (i) voluntarily commence (directly or on its behalf) any proceeding or file any petition seeking liquidation, reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to (directly or on its behalf) the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in paragraph (h) of this Section 8.1, (iii) apply for or consent to (in either case, directly or on its behalf) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;
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(j) the Borrower shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;
(k) (i) the Investment Adviser shall fail to be an Affiliate of Mariner Holdings, LLC, or Lovell Minnick Partners LLC, a Delaware limited liability company,, (ii) the custodian for all of the assets of the Borrower shall fail to be U.S. Bank National Association, or an Affiliate thereof, (iii) the sole administrator for the Borrower shall fail to be U.S. Bancorp Fund Services, LLC, or an Affiliate thereof, or (iv) the independent auditors for the Borrower shall fail to be Ernst & Young LLP;
(l) a Change of Control shall occur on any date that the Investment Adviser shall fail to be an Affiliate of Mariner Holdings,Lovell Minnick Partners LLC;
(m) one or more judgments for the payment of money (not paid or covered by insurance) in an aggregate amount in excess of the Threshold Amount shall be rendered against the Borrower and the same shall remain undischarged for a period of 60 consecutive days during which execution shall not be effectively stayed, vacated or bonded or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Borrower to enforce any such judgment;
(n) any Loan Document shall cease, for any reason other than pursuant to its terms, to be in full force and effect, or with respect to the Borrower, the Borrower shall so assert in writing or shall disavow any of its obligations thereunder;
(o) the suspension of registration of the Borrower’s shares or the commencement of any proceeding for such purpose;
(p) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in any Security Document;
(q) except as a result of any sale or other transfer of any asset in accordance with the terms of the Loan Documents, any Lien purported to be created under the Security Agreement shall cease to be, or shall be asserted by the Borrower not to be, a valid and perfected Lien on any Collateral (as defined in the Security Agreement), with the priority required by the applicable Security Document; or
(r) the Borrower’s shares shall be suspended from trading on The New York Stock Exchange for more than two consecutive days upon which trading in shares generally occurs on such exchange, or shall be delisted.
8.2 Remedies
If any Event of Default shall occur and be continuing then, and in every such event (other than an event described in paragraph (h) or (i) of Section 8.1), and at any time thereafter during the continuance of such event, the Bank may, by notice to the Borrower, take either or both of the following actions, at the same or different times: (a) declare the Commitment terminated, and thereupon the Commitment shall terminate immediately and/or (b) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of such Loans so declared to be due and payable, together with accrued and unpaid interest thereon and all fees and other obligations of the Borrower accrued and unpaid under the Loan Documents, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; and in the case of any event described in paragraph (h) or (i) of Section 8.1, the Commitment shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued and unpaid under the Loan Documents, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.
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ARTICLE IX
MISCELLANEOUS
9.1 Notices
Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile, or sent by electronic transmission in “portable document format”, as follows:
(a) if to the Borrower, to it at 11550 Ash Street, Suite 300 Leawood6363 College Boulevard Overland Park, KS 66211, Attention: Brad Adams, (Telephone: (913) 981-1020890-2177; Facsimile: (913) 981-1021; or
(b) if to the Bank, to it at, (i) in all cases, 250 Vesey Street, 23rd Floor, New York, NY, 10281, Attention: Aron Lau (Telephone: (212) 225-5952), and (ii) in the case of all notices and other communications pursuant to Article 2, with a copy to 720 King Street West, 4th Floor, Toronto, ON Canada M5V 2T3, Attention: Corporate Loan Team (Telephone: (212) 225-5705; Facsimile: (212) 225-5709; e-mail address: CorporateLending.LoanOps@scotiabank.com).
Any party hereto may change its address, e-mail address or facsimile number for notices and other communications hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with the provisions of this Credit Agreement shall be deemed to have been given on the date of receipt.
9.2 Waivers; Amendments
(a) No failure or delay by the Bank in exercising any right or power under any Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Bank under the Loan Documents are cumulative and are not exclusive of any rights or remedies that the Bank would otherwise have. No waiver of any provision of any Loan Document or consent to any departure by the Borrower therefrom shall in any event be effective unless the Bank shall have consented thereto in writing, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default, regardless of whether the Bank may have had notice or knowledge of such Default at the time.
(b) NeitherExcept as otherwise expressly provided herein, neither this Credit Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Bank.
9.3 Expenses; Indemnity; Damage Waiver
(a) The Borrower shall pay (i) all reasonable out-of-pocket costs and expenses incurred by the Bank and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Bank, in connection with the preparation, negotiation, closing and administration of this Credit Agreement or any amendments, modifications or waivers of the provisions of any Loan Document (whether or not the transactions contemplated thereby shall be consummated) and (ii) all reasonable out-of-pocket costs and expenses incurred by the Bank, including the reasonable fees and disbursements of counsel for the Bank, in connection with the enforcement or protection of its rights under the Loan Documents, including its rights under this Section, or in connection with the Loans, including all such out-of-pocket costs and expenses incurred during any workout, restructuring or negotiations.
(b) The Borrower shall indemnify the Bank and each Related Party thereof (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from all losses, claims, damages, liabilities and related costs and expenses (collectively, “Losses”), including the reasonable fees, charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of or as a result of (i) the execution or delivery by the Borrower of any Loan Document or any agreement or instrument contemplated thereby, the performance by the Borrower of its obligations under the Loan Documents or the consummation of the Transactions or any other transactions contemplated thereby, (ii) any Loan or the use of the proceeds thereof, or (iii) any actual or
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prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto. Subject to Section 9.3(c), nothing herein contained shall prevent or prohibit the Borrower from bringing any action against the Bank to recover any Losses suffered by the Borrower to the extent caused by the Bank’s failure to exercise due care in the performance of its obligations under the Loan Documents. The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of the Bank (as found by a final and nonappealable decision of a court of competent jurisdiction), the Bank shall be deemed to have exercised due care.
(c) To the extent permitted by applicable law, the Borrower agrees that it shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, any Loan Document or any agreement, instrument or other document contemplated thereby, the Transactions or any Loan or the use of the proceeds thereof.
(d) All amounts due under this Section shall be payable promptly but in no event later than 10 days after written demand therefor.
9.4 Successors and Assigns
The provisions of this Credit Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that (a) the Borrower shall not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Bank (and any attempted assignment or transfer by the Borrower without such consent shall be null and void), and (b) the Bank shall not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Borrower, such consent not to be (i) required during the continuance of any Event of Default, or (ii) unreasonably withheld, conditioned or delayed. Nothing in this Credit Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby and, to the extent expressly contemplated hereby, the Related Parties of the Bank) any legal or equitable right, remedy or claim under or by reason of any Loan Document. Notwithstanding anything to the contrary herein contained, the Bank may at any time pledge or assign a security interest in all or any portion of its rights under the Loan Documents to secure obligations of the Bank, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release the Bank from any of its obligations hereunder or substitute any such pledgee or assignee for the Bank as a party hereto.
9.5 Survival
All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Credit Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Credit Agreement and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Bank may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under the Loan Documents is outstanding and unpaid and so long as the Commitment has not expired or terminated. The provisions of Sections 3.3, 3.7 and 9.3 shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans and the termination of the Commitment or the termination of this Credit Agreement or any provision hereof.
9.6 Counterparts; Integration; Effectiveness
This Credit Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute but one contract. This Credit Agreement and any separate letter agreements with respect to fees payable to the Bank constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 5.1, this Credit Agreement shall become effective when it shall have been executed by the Bank and when the Bank shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors
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and assigns. Delivery of an executed counterpart of a signature page of any Loan Document, or any amendment, supplement or other modification thereto, by telecopy, emailed .pdf or any other electronic means that reproduces an image of the actual executed signature page shall be effective as delivery of a manually executed counterpart thereof. The words “execution”, “signed”, “signature”, “delivery” and words of like import in or relating to any document to be signed in connection with the Loan Documents and the transactions contemplated thereby shall be deemed to include Electronic Signatures, deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that nothing herein shall require the Bank to accept electronic signatures in any form or format without its prior written consent. Without limiting the generality of the foregoing, the Borrower hereby (i) agrees that, for all purposes, including without limitation, in connection with any workout, restructuring, enforcement of remedies, bankruptcy proceedings or litigation between the Bank and the Borrower, electronic images of each Loan Document (including with respect to any signature pages thereto) shall have the same legal effect, validity and enforceability as any paper original, and (ii) waives any argument, defense or right to contest the validity or enforceability of any Loan Document based solely on the lack of paper original copies thereof, including with respect to any signature pages thereto. For purposes hereof, “Electronic Signature” means an electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or record.
9.7 Severability
In the event any one or more of the provisions contained in this Credit Agreement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby (it being understood that the invalidity of a particular provision in a particular jurisdiction shall not in and of itself affect the validity of such provision in any other jurisdiction). The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the legal and economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.
9.8 Right of Setoff
If an Event of Default shall have occurred and be continuing, the Bank and its Affiliates are hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set-off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by it to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter owing under the Loan Documents, irrespective of whether or not it shall have made any demand under any Loan Document and although such obligations may be unmatured. The rights of the Bank under this Section are in addition to other rights and remedies (including other rights of set-off) that it may have.
9.9 Governing Law; Jurisdiction; Consent to Service of Process
(a) THIS CREDIT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.
(b) The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in the Borough of Manhattan in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to the Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that, to the extent permitted by applicable law, all claims in respect of any such action or proceeding may be heard and determined in such New York State court or, to the extent permitted by applicable law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Credit Agreement shall affect any right that the Bank may otherwise have to bring any action or proceeding relating to this Credit Agreement or the other Loan Documents against the Borrower, or any of its property, in the courts of any jurisdiction.
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(c) The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to the Loan Documents in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this Credit Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.1. Nothing in this Credit Agreement will affect the right of any party to this Credit Agreement to serve process in any other manner permitted by law.
9.10 WAIVER OF JURY TRIAL
EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS CREDIT AGREEMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS CREDIT AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
9.11 Headings
Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Credit Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Credit Agreement.
9.12 Interest Rate Limitation
Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts that are treated as interest on such Loan under applicable law (collectively the “charges”), shall exceed the maximum lawful rate (the “maximum rate”) that may be contracted for, charged, taken, received or reserved by the Bank in accordance with applicable law, the rate of interest payable in respect of such Loan, together with all of the charges payable in respect thereof, shall be limited to the maximum rate and, to the extent lawful, the interest and the charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated, and the interest and the charges payable to the Bank in respect of other Loans or periods shall be increased (but not above the maximum rate therefor) until such cumulated amount, together with interest thereon at the Alternate Base Rate to the date of repayment, shall have been received by the Bank.
9.13 Treatment of Certain Information
The Bank agrees to use reasonable precautions to keep confidential, in accordance with the Bank’s customary procedures for handling confidential information of the same nature, all non-public information supplied by the Borrower pursuant to this Credit Agreement which (a)(i) is clearly identified by such Person as being confidential at the time the same is delivered to the Bank, or (ii) constitutes any financial statement, list of investments or other assets, financial projections or forecasts, budget, compliance certificate, audit report, draft press release, management letter or accountants’ certification delivered hereunder, and (b) as of any date of determination, was received by the Bank within the immediately preceding three year period (“Information”), provided, however, that nothing herein shall limit the disclosure of any such Information (i) to its respective Related Parties, (ii) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, or requested by any bank regulatory authority, (iii) on a confidential basis, to other parties to the Loan Documents or to prospective lenders or their counsel, (iv) to auditors
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or accountants, and any analogous counterpart thereof, (v) in connection with any litigation to which the Bank is a party, (vi) to the extent such Information (A) becomes publicly available other than as a result of a breach of this Credit Agreement, (B) becomes available to the Bank on a non-confidential basis from a source other than the Borrower, or (C) was available to the Bank on a non-confidential basis prior to its disclosure to the Bank by the Borrower;, (viivi) on a confidential basis, to service providers for the Bank and its Affiliates, and (viiivii) to the extent the Borrower shall have consented to such disclosure in writing. The Bank acknowledges that Information furnished to it pursuant to this Credit Agreement may include material non-public information concerning the Borrower, its Related Parties or the Borrower’s securities, and confirms that it has developed compliance procedures regarding the use of material non-public information and that it will handle such material non-public information in accordance with those procedures and applicable law. Notwithstanding anything to the contrary contained in any Loan Document, no provision thereof shall (1) restrict the Bank from providing information to Federal Reserve supervisory staff, (2) require or permit, without the prior approval of the Federal Reserve, the Bank to disclose to the Borrower or any affiliate that any information will be or was provided to Federal Reserve supervisory staff, or (3) require or permit, without the prior approval of the Federal Reserve, the Bank to inform the Borrower or any affiliate of a current or upcoming Federal Reserve examination or any nonpublic Federal Reserve supervisory initiative or action. Nothing in this Credit Agreement or the Loan Documents shall prevent any of the parties hereto and their respective directors, officers, employees, agents and advisors from disclosing to any and all Persons the Tax treatment and Tax structure of the transactions contemplated by this Credit Agreement.
9.14 USA Patriot Act Notice
The Bank hereby notifies the Borrower that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow the Bank to identify the Borrower in accordance with the Patriot Act.
9.15 Acknowledgement Regarding any Supported QFCs
To the extent that any Loan Document (i) constitutes a QFC (such Loan Document, a “Loan Document QFC”), or (ii) provides support, through a guarantee or otherwise, for any Loan Document QFC, any Financial Contract or any other agreement or instrument that is a QFC (such support, “QFC Credit Support”, and each such QFC, a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that such Loan Document and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States):
(a) In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under such Loan Document that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and such Loan Document were governed by the laws of the United States or a state of the United States.
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(b) As used in this Section 9.15, the following terms have the following meanings:
“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.
“Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.
“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).
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TORTOISE ENERGY INDEPENDENCE FUND, INC.
EXHIBIT C
FORM OF WRITTEN BORROWING REQUEST
[Date]
The Bank of Nova Scotia
250 Vesey Street, 23rd Floor
New York, NY 10281
Attn: Aron Lau
720 King Street West, 4th Floor
Toronto, ON Canada M5V 2T3
Attn: Corporate Loan Team
Gentlemen/Ladies:
Reference is made to the Credit Agreement, dated as of June 2, 2016, between Tortoise Energy Independence Fund, Inc., a Maryland corporation, and The Bank of Nova Scotia (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”). Each term defined in the Credit Agreement and not herein defined has the meaning ascribed thereto by the Credit Agreement when used herein.
[For a Borrowing Request submitted in connection with a borrowing of a Loan under Section 2.2(a)]1
1. Pursuant to Section 2.2(a) of the Credit Agreement, the undersigned hereby gives notice of its intention to borrow a Loan (the “Proposed Borrowing”) under the Credit Agreement, and in connection therewith sets forth below the information relating to such borrowing as required by Section 2.2(a) of the Credit Agreement:
(a) The aggregate amount of the Proposed Borrowing is $ _________.
(b) The date (which shall be a Business Day) of such Proposed Borrowing is ___________, 20 _____ (the “Proposed Borrowing Date”).
(c) The Proposed Borrowing is to be [an Overnight Loan] [an ABR Loan] [a TS Loan having an Interest Period of ____________________].
(d) Proceeds of the Proposed Borrowing are to be wired or otherwise transferred to: [Specify exact wire or transfer instructions].
2. The Adjusted Asset Coverage (after giving effect to the Proposed Borrowing) is set forth below, reasonably detailed calculations of which appear on Schedule A attached hereto:
Adjusted Asset Coverage
_____:1.00
3. The Borrower hereby certifies that:
(a) on and as of the date hereof, no Default has occurred and is continuing, and
(b) on and as of the Proposed Borrowing Date, (i) no Default shall have occurred and be continuing, and (ii) the representations and warranties of the Borrower set forth in each Loan Document to which it is a party shall be true and correct in all respects (other than, as to any such representation or warranty that by its terms refers to a specific date, in which case such representation and warranty shall be true and correct in all respects as of such specified date).
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[For a Borrowing Request submitted in connection with a conversion or continuation of a Loan under Section 2.2(b)]2
1. Pursuant to Section 2.2(b) of the Credit Agreement, the undersigned hereby gives notice of its intention to [convert all or any portion of [an ABR Loan][an Overnight Loan][a TS Loan][an Existing LIBOR Loan] to [a TS Loan] [an ABR Loan][an Overnight Loan]] [continue all or any portion of a TS Loan as a TS Loan having an additional Interest Period] (the “Proposed [Conversion][Continuation]”) under the Credit Agreement, and in connection therewith sets forth below the information relating to such borrowing as required by Section 2.2(b) of the Credit Agreement:
(a) The aggregate amount of the Loan to be [converted][continued] is $ _____. Such Loan is a[n] [ABR Loan][Overnight Loan][Existing LIBOR Loan][TS Loan].
(b) The date (which shall be a Business Day) of such Proposed [Conversion][Continuation] is _______________, 20 _____.
(c) The Loan to be [converted][continued] shall be [converted into a [ABR Loan] [Overnight Loan][TS Loan having an Interest Period of _______________]] [continued as a TS Loan having an Interest Period of _______________].
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IN WITNESS WHEREOF, the undersigned has caused this Written Borrowing Request to be executed by its duly authorized representative as of the date first above written.
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Very truly yours,
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TORTOISE ENERGY INDEPENDENCE FUND, INC.
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By:
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Name:
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SCHEDULE A
Detailed Calculations
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Exhibit (d)(1)
Depositary and Information Agent Agreement
Between
Tortoise Energy Independence Fund, Inc.
And
Computershare Trust Company, N.A., Computershare Inc.
And
Georgeson LLC
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THIS DEPOSITARY AND INFORMATION AGENT AGREEMENT dated as of September 7, 2023 (the “Effective Date”), is by and between Tortoise Energy Independence Fund, Inc., a Maryland corporation (the “Purchaser”), having its principal office and place of business at 6363 College Boulevard, Overland Park, Kansas 66211, and Computershare Inc., a Delaware corporation (“Computershare”), and its wholly owned subsidiary Computershare Trust Company, N.A., a federally chartered trust company (“Trust Company”, and together with Computershare, “Agent”), each having a principal office and place of business at 150 Royall Street, Canton, Massachusetts 02021, and, for purposes of the services provided under Article II hereof, Georgeson LLC, a Delaware limited liability company (”Georgeson”).
ARTICLE I — DEPOSITARY SERVICES
1. APPOINTMENT
1.1 The Purchaser is offering to purchase up to 5% of its outstanding shares of Common Stock, $0.001 per share par value (the “Shares”), at 98% of pricing date NAV to the seller in cash, upon the terms and conditions set forth in its Offer to Purchase date October 2nd, 2023 (the “Offer to Purchase”) and in the letter of transmittal in a form acceptable to Agent (the “Letter of Transmittal”), which together, as they may be amended from time to time, constitute the “Offer”. Each Purchaser hereby appoints Agent to act as depositary and information agent in connection with the Offer and Agent hereby accepts such appointment in accordance with and subject to the terms and conditions set forth in this Agreement.
1.2 The “Expiration Date” for the Offer shall be 5:00 p.m. New York time, on November 1st, 2023, unless and until a Purchaser shall have extended the period of time for which the Offer is open, in which event the term “Expiration Date” shall mean the latest time and date at which the Offer, as so extended by such Purchaser from time to time, shall expire. Capitalized terms used but not defined herein shall have the same meanings as in the Offer.
1.3 Promptly after the date hereof, the Purchaser will furnish Agent as depository, with a certified list, in a format acceptable to Agent, of holders of the Shares of record at the date noted above on which the Offer to Purchase becomes effective (the “Effective Time”), including each such holder’s name, address, taxpayer identification number (“TIN”), Share amount with applicable tax lot detail, any certificate detail or indication of accounts holding the Shares through the Direct Registration System (“Book Entry Shares”) and information regarding any applicable account stops or blocks (the “Record Stockholders List”).
1.4 No later than the earlier of (i) forty-five (45) days after the Expiration Date or (ii) January 15 of the year following the year in which the Expiration Date occurs, the Purchaser shall deliver, to Agent as depository written direction on the adjustment of cost basis for covered securities that arise from or are affected by this Offer in accordance with current Internal Revenue Service regulations and as set forth in the Tax Instruction/Cost Basis Information Letter attached hereto as Exhibit A.
2. TENDER OF SHARES
Agent, in its capacity as depositary, will receive tenders of the Shares. Subject to the terms and conditions of this Agreement, Agent is authorized to accept such tenders of the Shares in accordance with the Offer, and to act in accordance with the following instructions:
2.1 The Shares shall be considered validly tendered to Agent only if:
(a) Agent receives prior to the Expiration Date, (i) certificates for such Shares (or a Confirmation (as defined in paragraph (b) below) relating to such Shares), if applicable, (ii) a properly completed and duly executed Letter of Transmittal or an Agent’s Message (as defined in paragraph (b) below) relating thereto, and (iii) if applicable, a final determination by Purchaser of the adequacy of the items received, in accordance with Article I, Section 8 hereof; or
(b) Agent receives (i) a Notice of Guaranteed Delivery (as defined in Article I, Section 2.2(b) below) relating to such Shares prior to the Expiration Date, (ii) certificates for such Shares (or a Confirmation relating to such Shares), if applicable, and either a properly completed and duly executed Letter of Transmittal or an Agent’s Message relating thereto, prior to the end of the [third] trading day on the New York Stock Exchange after the Expiration Date, and (iii) if applicable, a final determination by the Purchaser of the adequacy of the items received, in accordance with Article I, Section 8 hereof.
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2.2 For the purpose of this Agreement:
(a) a “Confirmation” shall be a confirmation of book-entry transfer of the Shares into an Agent account at The Depository Trust Company (the “Book-Entry Transfer Facility”) to be established and maintained by Agent in accordance with Article I, Section 3 hereof;
(b) a “Notice of Guaranteed Delivery” shall be a notice of guaranteed delivery in the form agreed upon by the parties hereto or, if sent by a Book-Entry Transfer Facility, a message transmitted through electronic means in accordance with the usual procedures of such Book-Entry Transfer Facility and Agent; provided, however, that if such notice is sent by a Book-Entry Transfer Facility through electronic means, it must state that such Book-Entry Transfer Facility has received an express acknowledgment from the participant on whose behalf such notice is given that such participant has received and agrees to be bound by the form of such notice; and an “Agent’s Message” shall be a message transmitted through electronic means by a Book-Entry Transfer Facility, in accordance with the normal procedures of such Book-Entry Transfer Facility and Agent, to and received by Agent and forming part of a Confirmation, which states that such Book-Entry Transfer Facility has received an express acknowledgment from the participant in such Book-Entry Transfer Facility tendering the Shares which are the subject of such Confirmation that such participant has received and agrees to be bound by the terms of the Letter of Transmittal, and that the Purchaser may enforce such agreement against such participant. The term Agent’s Message shall also include any hard copy printout evidencing such message generated by a computer terminal maintained at Agent’s office.
(c) The Purchaser acknowledges that in connection with the Offer Agent may enter into agreements or arrangements with a Book-Entry Transfer Facility which, among other things, provide that (i) delivery of an Agent’s Message will satisfy the terms of the Offer with respect to the Letter of Transmittal, (ii) such agreements or arrangements are enforceable against the Purchaser by such Book-Entry Transfer Facility or participants therein and (iii) Agent, as depositary, is authorized to enter into such agreements or arrangements on behalf of the Purchaser. Without limiting any other provision of this Agreement, Agent is expressly authorized to enter into any such agreements or arrangements on behalf of the Purchaser and to make any necessary representations or warranties in connection thereunder, and any such agreement or arrangement shall be enforceable against the Purchaser.
(d) If any holder of the Shares as of the Effective Time reports to Agent that his or her failure to surrender a certificate representing any Shares registered in his or her name at the Effective Time according to the Record Stockholders List is due to the theft, loss or destruction of such certificate, upon Agent’s receipt from such stockholder of (a) an affidavit of such theft, loss or destruction, (b) an open penalty surety bond in form and substance satisfactory to Agent, and (c) payment of all applicable fees, Agent will make and payment due in connection with the Offer to the former stockholder as though the certificate for the Shares had been surrendered. Agent may charge holders an administrative fee for processing payment with respect to the Shares represented by lost certificates, which shall be charged only once in instances where a single surety bond obtained covers multiple certificates in a single account. Agent may receive compensation, including in the form of commissions for services provided in connection with surety programs offered to stockholders.
3. BOOK-ENTRY ACCOUNT
Agent shall take steps to establish and, subject to such establishment, maintain an account at each Book-Entry Transfer Facility for book-entry transfers of the Shares, as set forth in the Letter of Transmittal.
4. PROCEDURE FOR DISCREPANCIES
Agent shall follow its regular procedures to attempt to reconcile any discrepancies between the number of Shares that any Letter of Transmittal may indicate are owned by a tendering stockholder and the number that the Record Stockholders List indicates such stockholder owned. In any instance where Agent cannot reconcile such discrepancies by following such procedures, Agent will consult with the Purchaser for instructions as to the number of Shares, if any; Agent is authorized to accept as validly tendered. In the absence of such instructions, Agent is authorized not to accept any such Shares and will return to the tendering stockholder (at Agent’s option by either first class mail
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under a blanket surety bond or insurance protecting Agent, the Purchaser from losses or liabilities arising out of the non-receipt or non-delivery of such Shares or by registered mail insured separately for the value of such Shares) to such stockholder’s address as set forth in the Letter of Transmittal any such Shares, the related Letters of Transmittal and any other documents received with such Shares.
5. PROCEDURE FOR DEFICIENT ITEMS
5.1 Agent shall examine any certificate representing the Shares, Letter of Transmittal, Notice of Guaranteed Delivery, Agent’s Message and any other document required by the Letter of Transmittal that is received by Agent as depositary to determine whether any tender may be defective. In the event Agent concludes that any Letter of Transmittal, Notice of Guaranteed Delivery, Agent’s Message or other document has been improperly completed, executed or transmitted, any certificate representing the Shares is not in proper form for transfer or some other irregularity in connection with the tender of the Shares exists, Agent is authorized, subject to 8.2 below, to advise the tendering stockholder or transmitting Book-Entry Transfer Facility, as the case may be, of the existence of the irregularity. Agent is not authorized to accept any tender that is not made in accordance with the terms and conditions set forth in the Offer, or any other tender which Agent deems to be defective, unless Agent shall have received from the Purchaser the applicable Letter of Transmittal (or if the tender was made by means of a Confirmation containing an Agent’s Message, a written notice), duly dated and signed by an authorized officer of the Purchaser, indicating that any defect or irregularity in such tender has been cured or waived and that such tender has been accepted by the Purchaser.
5.2 Promptly upon concluding that any tender is defective, Agent shall use reasonable efforts in accordance with Agent’s regular procedures to notify the person tendering such Shares, or Book-Entry Transfer Facility transmitting the Agent’s Message, as the case may be, of such determination and, when necessary, return the subject Shares to such person in the manner described in Article I, Section 8 hereof. The Purchaser shall have full discretion to determine whether any tender is complete and proper and shall have the absolute right to reject any or all tenders of any Shares determined by it not to be in proper form and to determine whether the acceptance of or payment for such tenders may, in the opinion of counsel for the Purchaser, be unlawful; it being specifically agreed that Agent shall have neither discretion nor responsibility with respect to these determinations. To the extent permitted by applicable law, the Purchaser also reserves the absolute right to waive any of the conditions of the Offer or any defect or irregularity in the tender of any Shares. The interpretation by the Purchaser of the terms and conditions of the Offer to Purchase, the Letter of Transmittal and the instructions thereto, a Notice of Guaranteed Delivery or an Agent’s Message (including without limitation the determination of whether any tender is complete and proper) shall be final and binding.
5.3 If less than all of the Shares validly tendered pursuant to the Offer are to be accepted because the Offer is oversubscribed by the Expiration Date, the Purchaser shall provide Agent with instructions regarding proration as soon as practicable. Agent shall maintain accurate records as to all the Shares tendered prior to or on the Expiration Date.
6. REPORT OF TENDER ACTIVITY
6.1. Agent shall forward up to 10 reports of tender activity, by email, beginning 2 weeks prior to the initial expiration date, to each of the parties named below as to the following information, based upon a preliminary review as of the close of business on the preceding business day: (i) the number of the Shares tendered; (ii) the number of the Shares tendered represented by certificates physically held by Agent; (iii) the number of the Shares represented by Notices of Guaranteed Delivery; (iv) the number of the Shares withdrawn; and (v) the cumulative totals of the Shares in categories (i) through (iv) above. At the expiration of the offer Agent shall provide a master list of the Shares elected, including a complete list of the electing stockholders.
6.2. Agent may furnish to the Purchaser, upon reasonable request, ad hoc reports. Fees for such reports will be as set forth on the Schedule of Fees attached hereto as Exhibit B. At the expiration of the Offer Agent shall provide a master list of the Shares tendered, including a complete list of the tendering stockholders.
7. NOTICE OF WITHDRAWAL
Agent will return to any person tendering the Shares, in the manner described in Article I, Section 8 hereof, any Shares tendered by such person but duly withdrawn pursuant to the Offer to Purchase. To be effective, Agent must receive a written notice of withdrawal at its address as set forth on the back page of the Offer to Purchase, within the time period specified for withdrawal in the Offer to Purchase or other method mutually agreed to by the Purchaser and Agent. Any notice of withdrawal must specify the name of the registered holder of the Shares to be withdrawn, the number of the
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Shares to be withdrawn and, if such Shares are represented by a physical certificate, the number of such certificate. Agent is authorized and directed to examine any notice of withdrawal to determine whether it believes any such notice may be defective. In the event Agent concludes that any such notice is defective it shall, after consultation with and on the instructions of the Purchaser, use reasonable efforts in accordance with its regular procedures to notify the person delivering such notice of such determination. All questions as to the form and validity (including time of receipt) of notices of withdrawal will be determined by the Purchaser in its sole discretion, whose determination shall be final and binding. Any Shares withdrawn in accordance with the procedures set forth in this section shall no longer be considered to be properly tendered unless such Shares are re-tendered prior to the Expiration Date in accordance with Article I, Section 2 hereof.
8. RETURN OF SHARES
If, pursuant to the terms and conditions of the Offer, the Purchaser has notified Agent that it does not accept certain of the Shares tendered or purported to be tendered or a stockholder has withdrawn any tendered Shares, the Purchaser instructs the Agent to promptly return tendered certificated Shares, by canceling all such certificated Shares and issuing an equal number of book-entry Shares in Direct Registration System to each tendering holder and mail a transaction advice reflecting such to each holder, together with any other documents received, to the person who deposited the same. Any transaction advice for such Shares and other documents shall be delivered by Agent, at its option, by:
a) first class mail under a blanket surety bond or insurance protecting Agent, the Purchaser from losses or liabilities arising out of the non-receipt or non-delivery of such Shares; or
b) registered mail insured separately for the value of such Shares. If any such Shares were tendered or purported to be tendered by means of a Confirmation containing an Agent’s Message, Agent shall notify the Book-Entry Transfer Facility that transmitted such Confirmation of the Purchaser’s decision not to accept the Shares.
9. AMENDMENT/EXTENSION OF OFFER
Any amendment to or extension of the Offer, as the Purchaser shall from time to time determine, shall be effective upon notice to Agent from the Purchaser given prior to the time the Offer would otherwise have expired, and shall be promptly confirmed by the Purchaser in writing; provided that Agent may rely on and shall be authorized and protected in acting or failing to act upon any such notice even if such notice is not confirmed in writing or such confirmation conflicts with such notice. If at any time the Offer shall be terminated as permitted by the terms thereof, the Purchaser shall promptly notify Agent of such termination. For purpose of this Agreement, an extension or subsequent offer period (an “Extension”) shall last up to 10 business days. Any Extension period exceeding 10 business days will incur additional fees commensurate with that extension or extensions.
10. DISTRIBUTION OF ENTITLEMENTS
10.1 If, under the terms and conditions set forth in the Offer to Purchase, the Purchaser becomes obligated to accept and pay for the Shares validly tendered, the Purchaser shall:
a) Provide Agent with a Notice of Acceptance in a form mutually agreed to by Agent and the Purchaser
b) Provide Agent with instructions to coordinate the transfer of the Shares purchased in a form mutually agreed to by Agent and the Purchaser (the “Transfer of Shares”)
c) Deposit with Agent sufficient federal or other immediately available funds to pay, subject to the terms and conditions of the Offer, all stockholders for whom payment for the Shares are to be drawn, less any adjustments required by the terms of the Offer and all applicable tax withholdings (“Tender Consideration”),
10.2 Upon the Transfer of the Shares and deposit of immediately available funds, Agent shall deliver or cause to be delivered to stockholders who have validly tendered their Shares (or such holders’ designated payees), consistent with this Agreement and the Letter of Transmittal, official bank checks, or other method as mutually agreed between Agent and the Purchaser, in the amount of the applicable purchase price specified in the Offer (less any applicable tax withholding) for the Shares theretofore properly tendered and purchased under the terms and conditions of the
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Offer (the “Payment Event”). Tender Consideration must be received by Agent prior to 9:00 a.m. New York City time for Payment Event to commence on the same day that Tender Consideration is received by Agent. Agent will not be obligated to calculate or pay interest to any holder or any other party claiming through a holder or otherwise.
ARTICLE II — Information Agent Services
Information Agent Services
1. Services. Georgeson shall perform the information agent services described in the attached Exhibit B (such services, collectively, the “IA Services”).
2. Fees. In consideration of Georgeson’s performance of the IA Services, the Purchaser shall pay Georgeson the amounts, and pursuant to the terms, set forth on the attached Exhibit B, together with the Expenses (as defined below). The Purchaser acknowledges and agrees that the Schedule of Fees shall be subject to adjustment if the Purchaser requests Georgeson to provide services with respect to additional matters or a revised scope of work.
3. Expenses. In addition to the fees and charges described in paragraphs (2) hereof, Georgeson shall charge the Purchaser, and the Purchaser shall be solely responsible, for the following costs and expenses (collectively, the “Expenses”):
a. Costs and expenses incidental to the Offer, including without limitation the mailing or delivery of Offer materials;
b. Costs and expenses relating to Georgeson’s work with its agents or other parties involved in the Offer, including without limitation charges for bank threshold lists, data processing, telephone directory assistance, facsimile transmissions or other forms of electronic communication;
c. Costs and expenses incurred by Georgeson at the Purchaser’s request or for the Purchaser’s convenience, including without limitation for copying, printing of additional and/or supplemental material and travel by Georgeson’s personnel; and
d. Any other costs and expenses authorized by the Purchaser during the course of the Offer, including without limitation those relating to advertising (including production and posting), media relations and analytical services.
e. The Purchaser shall pay all applicable taxes incurred in connection with the delivery of the IA Services or Expenses.
4. Custodial Charges. Georgeson agrees to check, itemize and pay on the Purchaser’s behalf the charges of brokers and banks, with the exception of Broadridge Financial Solutions, Inc. (which will bill the Purchaser directly), for forwarding the Purchaser’s offering material to beneficial owners. The Purchaser shall reimburse Georgeson for such broker and bank charges in the manner described in the Fees & Services Schedule.
ARTICLE III — GENERAL PROVISIONS
1. PROCEDURE FOR DISCREPANCIES
Agent shall follow its regular procedures to attempt to reconcile any discrepancies between the number of certificated Shares that any Letter of Transmittal may indicate are owned by a surrendering stockholder and the number that the Record Stockholders List indicates such stockholder owned of record as of the Effective Time. In any instance where Agent cannot reconcile such discrepancies by following such procedures, Agent will consult with the Purchaser for instructions as to the number of certificated Shares, if any; Agent is authorized to accept for exchange. In the absence of such instructions, Agent is authorized not to accept any such certificated Shares for exchange and will return to the surrendering stockholder in accordance with its standard procedures to such stockholder’s address as set forth in the Letter of Transmittal any certificates for the Shares surrendered in connection therewith, the related Letters of Transmittal and any other documents received with such Shares.
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2. PROCEDURE FOR DEFICIENT ITEMS
2.1 Agent shall examine the Letter of Transmittal and certificates for the Shares received by it as agent to ascertain whether they appear to have been completed and executed in accordance with the instructions set forth in the Letter of Transmittal. In the event Agent determines that any Letter of Transmittal does not appear to have been properly completed or executed, or where the certificates representing the Shares do not appear to be in proper form for surrender, or any other deficiency in connection with the surrender appears to exist, the Purchaser authorizes and instructs Agent to follow, where possible, its regular procedures, set forth in Article III, Section 2.3 below, to attempt to cause such irregularity to be corrected. Agent is not authorized to waive any deficiency in connection with the surrender, unless the Purchaser provides written authorization to waive such deficiency, subject to applicable law and regulations.
2.2 If a Letter of Transmittal specifies that payment for the Shares is to be made to a person other than the person in whose name a surrendered certificate is registered, Agent will issue no Tender Consideration until such Letter of Transmittal has been properly endorsed with a signature guarantee from an eligible guarantor institution approve by the Securities Transfer Association, and accompanied by any other evidence of authority that may be reasonably required by the Agent, and otherwise put in proper form for transfer.
2.3 If any such deficiency with respect to any certificated Shares is neither corrected nor waived, Agent shall: (a) convert the Shares represented by such certificate to a Book Entry position and (b) Send to such holder a defect letter describing the applicable defects and asking that the deficiencies be corrected.
3. ELIGIBILITY OF SHARES FOR PAYMENT
Agent requests specific information with respect to affiliates, Shares ineligible for tender, and any stockholder plans affected by this Offer including any treasury positions. Purchaser agrees to provide all such applicable information on the list of affiliates, ineligible Shares and plans attached hereto as Exhibit C, as requested.
4. DEPOSIT OF FUNDS
4.1 All funds received by Computershare pursuant to this Agreement that are to be distributed or applied by Computershare in accordance with the terms of this Agreement (the “Funds”) shall be delivered to Computershare by 9:00 a.m. Eastern Time (“ET”) and in no event later than 12:00 p.m. ET on the Effective Time. Funding after 9:00 a.m. but before 12:00 p.m. on the Effective Time may cause delays in payments to be made on the Effective Time. Delivery of the Funds on any day after 12:00 p.m. ET will be subject to the terms of Article III, Section 4.4, below. Once received by Computershare, the Funds shall be held by Computershare as agent for the Purchaser. Until paid or distributed in accordance with this Agreement, the Funds shall be deposited in one or more bank accounts to be maintained by Computershare in its name as agent for the Purchaser. Until paid pursuant to this Agreement, Computershare may hold or invest the Funds through such accounts in: (i) bank accounts, short term certificates of deposit, bank repurchase agreements, and disbursement accounts with commercial banks with Tier 1 capital exceeding $1 billion or with an average rating above investment grade by S&P (LT Local Issuer Credit Rating), Moody’s (Long Term Rating) and Fitch Ratings, Inc. (LT Issuer Default Rating) (each as reported by Bloomberg Finance L.P.), (ii) cash management sweeps to AAA fixed NAV money market funds that comply with Rule 2a-7 of the Investment Company Act of 1940, (iii) funds backed by obligations of, or guaranteed by, the United States of America, municipal securities, or (iv) debt or commercial paper obligations rated A-1 or P-1 or better by S&P Global Inc. (“S&P”) or Moody’s Investors Service, Inc. (“Moody’s”), respectively.
4.2 Computershare will only draw upon the Funds in such account(s) as required from time to time in order to make the payments for the Shares and any applicable tax withholding payments. Computershare shall have no responsibility or liability for any diminution of the Funds that may result from any deposit or investment made by Computershare in accordance with this Article III, Section 4, including any losses resulting from a default by any bank, financial institution or other third party. Computershare may from time to time receive interest, dividends or other earnings in connection with such deposits. Computershare shall not be obligated to pay such interest, dividends or earnings to the Purchaser, any holder or any other party.
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4.3 Computershare is acting as Agent hereunder and is not a debtor of the Purchaser in respect of the Funds.
4.4 In the case of late-day funding, which means delivery of the Funds to Computershare after 12:00 p.m. ET on any day, regardless of whether such funding occurs prior to, or after, the Effective Time as set forth in Article III, Section 4.1 above (“Late-Day Funding”), Federal Deposit Insurance or other bank liquidity charges may apply in connection with the overnight deposit of the Funds with commercial banks. The parties hereto agree that any such charges assessed as a result of Late-Day Funding will be charged to the Purchaser and the Purchaser hereby agrees to pay such charges.
4.5 The Purchaser agrees to deliver the Funds by wire to the account(s) listed on the attached Exhibit D, which may be amended in writing from time to time.
5. International Currency Exchange
Computershare at its option may offer its International Currency Exchange (“ICE”) Service (the “Service”) to certain shareholders whereby any such shareholder can elect to receive their payment in a currency other than U.S. Dollars, via a convenient and secure currency conversion service. The Service is voluntary and will only be utilized at the direction of the eligible shareholder electing such Service and agreeing to the terms and condition of the Service as described in the ICE Registration Form included with a Letter of Transmittal and sent to eligible shareholders. Agent shall charge a fee to participants for processing. The Purchaser will not incur fees resulting from the Service.
6. DATE/TIME STAMP
Each document received by Agent relating to its duties hereunder shall be dated and time stamped when received.
7. LOST CERTIFICATES If any holder of the Shares as of the Effective Time reports to Agent that his or her failure to surrender a certificate representing any Shares registered in his or her name at the Effective Time according to the record stockholders list is due to the theft, loss or destruction of such certificate, upon Agent’s receipt from such stockholder of (i) an affidavit of such theft, loss or destruction, (ii) an open penalty surety bond in form and substance satisfactory to Agent, and (iii) payment of all applicable fees, Agent will make payment of the consideration to the former stockholder as though the certificate for the Shares had been surrendered. Agent may charge holders an administrative fee for processing payment with respect to the Shares represented by lost certificates, which shall be charged only once in instances where a single surety bond obtained covers multiple certificates in a single account. Agent may receive compensation, including in the form of commissions for services provided in connection with surety programs offered to stockholders.
8. TAX REPORTING
8.1 Agent shall prepare and file with the appropriate governmental agency and mail to each stockholder, as applicable, all appropriate tax information forms, including but not limited to Forms 1099-B, covering payments or any other distributions made by Agent pursuant to this Agreement during each calendar year, or any portion thereof, during which Agent performs services hereunder, as described in the Tax Instruction/Cost Basis Information Letter attached hereto as Exhibit A. Any cost basis or tax adjustments required after the Effective Time will incur additional fees.
8.2 With respect to any surrendering stockholder whose TIN has not been certified as correct, Agent shall deduct and withhold the appropriate backup withholding tax from any payment made to such stockholder pursuant to the Internal Revenue Code.
8.3 Should any issue arise regarding federal income tax reporting or withholding, Agent shall take such reasonable action as the Purchaser may reasonably request in writing. Such action may be subject to additional fees.
9. UNCLAIMED PROPERTY The Agent shall report unclaimed property to each state in compliance with state laws. The Agent will charge the Purchaser its standard fees plus expenses (including the cost of due diligence mailings) for such services. The Purchaser acknowledges and agrees that in the case of reports made and property delivered pursuant to an initial or voluntary compliance program administered by private auditing agents retained by state unclaimed property administrators, the Agent will be compensated for its efforts in facilitating the Purchaser’s involvement in such a program including the provision of the necessary records and remittance of property in the
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manner required by the program by means of an expense reimbursement payment based on a percentage of the property remitted to the states through participation in the program. The Purchaser will not be charged for any services performed by the Agent in conjunction with the program to the extent that the Agent receives an expense reimbursement and agrees to reimburse Agent for any expenses incurred in the performance of such services.
10. AUTHORIZATIONS AND PROTECTIONS
As agent for the Purchaser hereunder, Agent and Georgeson, respectively:
10.1 Shall have no duties or obligations other than those specifically set forth herein or as may subsequently be agreed to in writing by Agent or Georgeson, as applicable, and the Purchaser;
10.2 Shall have no obligation to make any payment for the Shares unless the Purchaser shall have provided the necessary federal or other immediately available funds to pay in full amounts due and payable with respect thereto;
10.3 Shall be regarded as making no representations and having no responsibilities as to the validity, sufficiency, value, or genuineness of any certificates or the Shares represented thereby surrendered hereunder and will not be required to or be responsible for and will make no representations as to, the validity, sufficiency, value or genuineness of the Offer;
10.4 Shall not be obligated to take any legal action hereunder; if, however, Agent or Georgeson, as applicable, determines to take any legal action hereunder, and where the taking of such action might, in such party’s judgment, subject or expose it to any expense or liability, Agent or Georgeson, as applicable, shall not be required to act unless it shall have been furnished with an indemnity satisfactory to it;
10.5 May rely on and shall be fully authorized and protected in acting or failing to act upon any certificate, instrument, opinion, notice, letter, telegram, telex, facsimile transmission or other document or security delivered to Agent and believed by Agent or by Georgeson, as applicable, to be genuine and to have been signed by the proper party or parties;
10.6 Shall not be liable or responsible for any recital or statement contained in the Offer to Purchase or any other documents relating thereto;
10.7 Shall not be liable or responsible for any failure of the Purchaser or any other party to comply with any of its covenants and obligations relating to the Offer, including without limitation obligations under applicable securities laws;
10.8 Shall not be liable to any holder of the Shares for any property that has been delivered to a public official pursuant to applicable abandoned property law;
10.9 May, from time to time, rely on instructions provided by the Purchaser concerning the services provided hereunder. Further, Agent or Georgeson, as applicable, may apply to any officer or other authorized person of Purchaser for instruction, and may consult with legal counsel for Agent or Georgeson, as applicable, or the Purchaser with respect to any matter arising in connection with the services provided hereunder. Agent and its agents and subcontractors shall not be liable and shall be indemnified by Purchaser under Article III, Section 12.2 of this Agreement for any action taken or omitted by Agent or Georgeson, as applicable, in reliance upon any Purchaser instructions or upon the advice or opinion of such counsel. Neither Agent nor Georgeson shall be held to have notice of any change of authority of any person, until receipt of written notice thereof from the Purchaser;
10.10 May rely on and be fully authorized and protected in acting or failing to act upon (a) any guaranty of signature by an “eligible guarantor institution” that is a member or participant in the Securities Transfer Agents Medallion Program or other comparable “signature guarantee program” or insurance program in addition to, or in substitution for, the foregoing; or (b) any law, act, regulation or any interpretation of the same even though such law, act, or regulation may thereafter have been altered, changed, amended or repealed;
10.11 Either in connection with, or independent of the instruction term in Article III, Section 10.9 above, Agent or Georgeson, as applicable, may consult counsel satisfactory to such party (including internal counsel), and the advice of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by Agent or Georgeson, as applicable, hereunder in good faith and in reliance upon the advice of such counsel;
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10.12 May perform any of its duties hereunder either directly or by or through agents or attorneys and neither Agent nor Georgeson shall be liable or responsible for any misconduct or negligence on the part of any agent or attorney appointed with reasonable care hereunder; and
10.13 Is not authorized, and shall have no obligation, to pay any brokers, dealers, or soliciting fees to any person.
11. REPRESENTATIONS AND WARRANTIES
11.1 Agent. Agent represents and warrants to Purchaser that:
(a) Governance. Trust Company is a federally chartered trust company duly organized, validly existing, and in good standing under the laws of the United States and Computershare is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware and each has full power, authority and legal right to execute, deliver and perform this Agreement; and
(b) Compliance with Laws. The execution, delivery and performance of this Agreement by Agent has been duly authorized by all necessary action, constitutes the legal, valid and binding obligation of Agent enforceable against Agent in accordance with its terms, will not require the consent of any third party that has not been given, and will not violate, conflict with or result in the breach of any material term, condition or provision of (i) any existing law, ordinance, or governmental rule or regulation to which Agent is subject, (ii) any judgment, order, writ, injunction, decree or award of any court, arbitrator or governmental or regulatory official, body or authority applicable to Agent, (iii) Agent’s incorporation documents or by-laws, or (iv) any material agreement to which Agent is a party.
11.2 Purchaser. Purchaser represents and warrants to Agent that:
(a) Governance. It is a corporation duly organized, validly existing and in good standing under the laws of the State of Maryland, and it has full power, authority and legal right to enter into and perform this Agreement;
(b) Compliance with Laws. The execution, delivery and performance of this Agreement by Purchaser has been duly authorized by all necessary action, constitutes the legal, valid and binding obligation of Purchaser enforceable against Purchaser in accordance with its terms, will not require the consent of any third party that has not been given, and will not violate, conflict with or result in the breach of any material term, condition or provision of (i) any existing law, ordinance, or governmental rule or regulation to which Purchaser is subject, (ii) any judgment, order, writ, injunction, decree or award of any court, arbitrator or governmental or regulatory official, body or authority applicable to Purchaser, (iii) Purchaser’s incorporation documents or by-laws, (iv) any material agreement to which Purchaser is a party, or (v) any applicable stock exchange rules; and
(c) Shares. The Shares issued and outstanding on the date hereof have been duly authorized, validly issued and are fully paid and are non-assessable.
11.3 Georgeson. Georgeson represents and warrants to Purchaser that:
(a) Governance. Information Agent is an LLC duly organized, validly existing, and in good standing under the laws of the State of Delaware and has full power, authority and legal right to execute, deliver and perform this Agreement; and
(b) Compliance with Laws. The execution, delivery and performance of this Agreement by Georgeson has been duly authorized by all necessary action, constitutes the legal, valid and binding obligation of Georgeson enforceable against Georgeson in accordance with its terms, will not require the consent of any third party that has not been given, and will not violate, conflict with or result in the breach of any material term, condition or provision of (i) any existing law, ordinance, or governmental rule or regulation to which Georgeson is subject, (ii) any judgment, order, writ, injunction, decree or award of any court, arbitrator or governmental or regulatory official, body or authority applicable to Georgeson, (iii) Georgeson’s incorporation documents or by-laws, or (iv) any material agreement to which Georgeson is a party.
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12. INDEMNIFICATION AND LIMITATION OF LIABILITY
12.1 Liability. Agent and Georgeson shall only be liable, severally and not jointly, for any loss or damage determined by a court of competent jurisdiction to be a result of Agent’s or Georgeson‘s respective gross negligence or willful misconduct; provided that any respective liability of Agent and Georgeson will be limited in the aggregate to the amounts paid hereunder by Purchaser to Agent or Georgeson, respectively, as fees and charges, but not including reimbursable expenses.
12.2 Indemnity. Purchaser shall indemnify and hold Agent and Georgeson harmless from and against, and neither Agent nor Georgeson shall be responsible for, any and all losses, claims, damages, costs, charges, counsel fees and expenses, payments, expenses and liability (collectively, “Losses”) arising out of or attributable to Agent’s or Georgeson’s respective duties under this Agreement or this appointment, including the reasonable costs and expenses of defending itself against any Loss or enforcing this Agreement, except for any liability of Agent or Georgeson as set forth in Article III, Section 12.1 above.
13. DAMAGES
Notwithstanding anything in this Agreement to the contrary, no party shall be liable to any other for any incidental, indirect, special or consequential damages of any nature whatsoever, including, but not limited to, loss of anticipated profits, occasioned by a breach of any provision of this Agreement even if apprised of the possibility of such damages.
14. CONFIDENTIALITY
14.1 Definition. “Confidential Information” shall mean any and all technical or business information relating to a party, including, without limitation, financial, marketing and product development information, shareholder data (including any non-public information of such shareholder), proprietary information, and the terms and conditions (but not the existence) of this Agreement, that is disclosed or otherwise becomes known to the other party or its affiliates, agents or representatives before or during the term of this Agreement. Confidential Information constitutes trade secrets and is of great value to the owner (or its affiliates). Confidential Information shall not include any information that is: (a) already known to the other party or its affiliates at the time of the disclosure; (b) publicly known at the time of the disclosure or becomes publicly known through no wrongful act or failure of the other party; (c) subsequently disclosed to the other party or its affiliates on a non-confidential basis by a third party not having a confidential relationship with the owner and which rightfully acquired such information; or (d) independently developed by one party without access to the Confidential Information of the other.
14.2 Use and Disclosure. All Confidential Information of a party will be held in confidence by the other party with at least the same degree of care as such party protects its own confidential or proprietary information of like kind and import, but not less than a reasonable degree of care. Neither party will disclose in any manner Confidential Information of the other party in any form to any person or entity without the other party’s prior consent. However, each party may disclose relevant aspects of the other party’s Confidential Information to its officers, affiliates, agents, subcontractors and employees to the extent reasonably necessary to perform its duties and obligations under this Agreement and such disclosure is not prohibited by applicable law. Without limiting the foregoing, each party will implement such physical and other security measures and controls which are designed to protect (a) the security and confidentiality of Confidential Information; (b) against any threats or hazards to the security and integrity of Confidential Information; and (c) against any unauthorized access to or use of Confidential Information. To the extent that a party delegates any duties and responsibilities under this Agreement to an agent or other subcontractor, the party ensures that such agent and subcontractor are contractually bound to confidentiality terms consistent with the terms of this Article III, Section 14.
14.3 Required or Permitted Disclosure. In the event that any requests or demands are made for the disclosure of Confidential Information, other than requests to Agent or Georgeson, as applicable, for shareholder records pursuant to standard subpoenas from state or federal government authorities (e.g., divorce and criminal actions), the party receiving such request will promptly notify the other party to secure instructions from an authorized officer of such party as to such request and to enable the other party the opportunity to obtain a protective order or other confidential treatment, unless such notification is otherwise prohibited by law or court order. Each party expressly reserves the right, however, to disclose Confidential Information to any person whenever it is advised by counsel that it may be held liable for the failure to disclose such Confidential Information or if required by law or court order.
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14.4 Unauthorized Disclosure. As may be required by law and without limiting any party’s rights in respect of a breach of this Article III, Section 14, each party will promptly:
(a) Notify the other party in writing of any unauthorized possession, use or disclosure of the other party’s Confidential Information by any person or entity that may become known to such party;
(b) Furnish to the other party full details of the unauthorized possession, use or disclosure; and
(c) Use commercially reasonable efforts to prevent a recurrence of any such unauthorized possession, use or disclosure of Confidential Information.
14.5 Costs. Each party will bear the costs it incurs as a result of compliance with this Article III, Section 14.
15. TERMINATION
15.1 Depositary. The Agent or the Purchaser may, with respect to the depositary services, terminate this Agreement upon 30 days prior written notice to the other party. Unless so terminated, this Agreement shall continue in effect until all Shares have been received and paid for, or until the final delivery of all Tender Consideration(s) to the appropriate states as unclaimed property. In the event of such termination, the Purchaser will appoint a successor agent and inform Agent of the name and address of any successor agent so appointed, provided that no failure by the Purchaser to appoint such a successor agent shall affect the termination of this Agreement or the discharge of Agent as agent hereunder. Upon any such termination, Agent shall be relieved and discharged of any further responsibilities with respect to its duties hereunder. Upon payment of all outstanding fees and expenses hereunder, Agent shall promptly forward to the Purchaser or its designee any unpaid Tender Consideration deposited with Agent pursuant to Article III, Section 4 hereof.
15.2 Information Agent. Either Georgeson or the Purchaser may, with respect to the IA Services, terminate this Agreement upon 30 days prior written notice to the other party. Unless so terminated, this Agreement shall, with respect to IA Services continue in effect for the term of the Offer and any extension thereof, and shall terminate upon the final expiration of the Offer.
15.3 Notices of termination delivered pursuant to Article III, Section 15.1, above, will not be deemed to terminate IA Services. Likewise, termination pursuant to Article III, Section 15.2, above, will not be deemed to terminate depositary services.
16. COMPENSATION AND EXPENSES
16.1 The Purchaser shall pay to Agent and to Georgeson, respectively, compensation in accordance with the attached Exhibit B, together with reimbursement for reasonable fees and disbursements of counsel, regardless of whether any Shares are surrendered to Agent, for Agent’s services as agent hereunder, and for Georgeson’s services as information agent hereunder.
16.2 The Purchaser shall be charged for certain expenses advanced or incurred by Agent and Georgeson in connection with the performance of their respective duties hereunder. Such charges include, but are not limited to, stationery and supplies, such as checks, envelopes and paper stock, as well as any disbursements for telephone and document creation and delivery. While both Agent and Georgeson endeavor to maintain such charges (both internal and external) at competitive rates, these charges may not reflect actual out-of-pocket costs, and may include handling charges to cover internal processing and use of Agent’s and Georgeson’s billing systems.
16.3 If any out-of-proof condition caused by the Purchaser or any of its prior agents arises during any terms of this agreement, the Purchaser will, promptly upon Agent’s request, provide Agent with funds or Shares sufficient to resolve the out-of-proof condition.
16.4 All amounts owed to Agent and Georgeson hereunder are due within thirty (30) days of the invoice date. Delinquent payments are subject to a late payment charge of one and one half percent (1.5%) per month commencing forty-five (45) days from the invoice date. The Purchaser agrees to reimburse Agent and Georgeson for any attorney’s fees and any other costs associated with collecting delinquent payments.
16.5 The parties hereto agree that in the event that Agent and Georgeson commence performance under this Agreement, which performance may include, inter alia, initial project set-up activity, balancing and reconciliation, loading files, preparing letters of transmittal or other documents, as applicable, but the transaction contemplated
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hereunder is not initiated for any reason, the Purchaser agrees to pay, in any event, the Event Management fee and the IA Services base fee, set forth in Exhibit B, attached hereto. In addition, the Purchaser agrees to pay any expenses incurred by the Agent in connection with the services hereunder, up to and including the date on which Agent receives written notice of termination pursuant to Article III, Section 15 hereof.
16.6 Following initiation and notice of termination of this Agreement for any reason, the Purchaser hereby agrees to pay on or before the effective date of such termination (a) all fees earned and expenses set forth on the attached Exhibit B incurred by Agent through and including the date of such termination, including, in any event, the Event Management Fee, and (b) all costs and expenses associated with the movement of records, materials, and services to Purchaser or the successor agent, including all reasonable expense.
16.7 Purchaser is responsible for all taxes, levies, duties, and assessments levied on services purchased under this Agreement (collectively, “Transaction Taxes”). Computershare is responsible for collecting and remitting Transaction Taxes in all jurisdictions in which Computershare is registered to collect such Transaction Taxes. Computershare shall invoice Purchaser for such Transaction Taxes that Computershare is obligated to collect upon the furnishing of services provided hereunder. Purchaser shall pay such Transaction Taxes according to the terms in Article III, Section 16.1, above. Computershare shall timely remit to the appropriate governmental authorities all such Transaction Taxes that Computershare collects from Purchaser. To the extent that Purchaser provides Computershare with valid exemption certificates, direct pay permits, or other documentation that exempts Computershare from collecting Transaction Taxes from Purchaser, invoices issued for services hereunder provided after Computershare’s receipt of such certificates, permits, or other documentation will not reflect exempted Transaction Taxes. Computershare is solely responsible for the payment of all personal property taxes, franchise taxes, corporate excise or privilege taxes, property or license taxes, taxes relating to Computershare’s personnel, and taxes based on Computershare’s net income or gross revenues relating to services provided hereunder.
17. ASSIGNMENT
Neither this Agreement nor any rights or obligations hereunder may be assigned by Purchaser or Agent without the written consent of the other; provided, however, that Agent may, without further consent of Purchaser, assign any of its rights and obligations hereunder to any affiliated agent registered under Rule 17Ac2-1 promulgated under the 1934 Act.
18. SUBCONTRACTORS AND UNAFFILIATED THIRD PARTIES
18.1 Subcontractors. Agent may, without further consent of Purchaser, subcontract with (a) any affiliates, or (b) unaffiliated subcontractors for such services as may be required from time to time (e.g. lost shareholder searches, escheatment, telephone and mailing services); provided, however, that Agent shall be as fully responsible to Purchaser for the acts and omissions of any subcontractor as it is for its own acts and omissions.
18.2 Unaffiliated Third Parties. Nothing herein shall impose any duty upon Agent in connection with or make Agent liable for the actions or omissions to act of unaffiliated third parties (other than subcontractors referenced in Article III, Section 18.1 of this Agreement) such as, by way of example and not limitation, airborne services, delivery services, the U.S. mails, and telecommunication companies, provided, if Agent selected such company, Agent exercised due care in selecting the same.
19. MISCELLANEOUS
19.1 Notices. All notices, demands and other communications given pursuant to the terms and provisions hereof shall be in writing, shall be deemed effective on the date of receipt, and may be sent by overnight delivery services, or by certified or registered mail, return receipt requested to:
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If to the Purchaser:
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with an additional copy to:
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Tortoise Capital Advisors, L.L.C.
6363 College Boulevard, Suite 100A
Overland Park, KS 66211
Attn: Brad Adams
badams@tortoiseecofin.com
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Sean Wickliffe (swickliffe@tortoiseecofin.com)
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Invoice for Fees and Services (if different than above):
Same as above.
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If to Agent (as applicable):
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with an additional copy to:
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Computershare Inc.
480 Washington Blvd, 29th Floor
Jersey City, NJ 07310
Attn: Corp Actions Relationship Manager
Or
Computershare Inc.
150 Royall Street
Canton, MA 02021
Attn: Corp Actions Relationship Manager
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Computershare Inc.
150 Royall Street
Canton, MA 02021
Attn: Legal Department
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If to Georgeson:
Georgeson LLC
1290 Avenue of the Americas, 9th Floor,
New York, NY 10104
Attn: Relationship Manager
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with an additional copy to:
Georgeson LLC
480 Washington Blvd, 29th Floor
Jersey City, NJ 07310
Attn: Legal Department
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19.2 No Expenditure of Funds. No provision of this Agreement shall require Agent or Georgeson, as applicable, to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of its rights if it shall believe in good faith that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it.
19.3 Publicity. No party shall issue a news release, public announcement, advertisement, or other form of publicity concerning the existence of this Agreement or the Services to be provided hereunder without obtaining the prior written approval of the other party, which may be withheld in the other party’s sole discretion; provided that Agent and Georgeson may each use Purchaser’s name in their respective customer lists or otherwise as required by law or regulation.
19.4 Successors. All the covenants and provisions of this Agreement by or for the benefit of Purchaser or Agent and Georgeson, as applicable, shall bind and inure to the benefit of their respective successors and assigns hereunder.
19.5 Amendments. This Agreement may be amended or modified by a written amendment executed by the parties hereto and, to the extent required, authorized by a resolution of the Board of Directors of Purchaser.
19.6 Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provision, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.
19.7 Governing Law; Jurisdiction. This Agreement shall be governed by the laws of the State of New York, without regard to principles of conflicts of law. The parties irrevocably, (a) submit to the non-exclusive jurisdiction of any New York State court sitting in New York City or the United States District Court for the Southern District of New York in any action or proceeding arising out of or relating to this Agreement, (b) waive, to the fullest extent they may effectively do so, any defense based on inconvenient forum, improper venue or lack of jurisdiction to the maintenance of any such action or proceeding, and (c) waive all right to trial by jury in any action, proceeding or counterclaim arising out of this Agreement or the transactions contemplated hereby. Neither Agent nor Georgeson shall be required hereunder to comply with the laws or regulations of any country other than the United States of America or any political subdivision thereof. Agent and Georgeson may each consult with foreign counsel, at Purchaser’s expense, to resolve any foreign law issues that may arise as a result of Purchaser or any other party being subject to the laws or regulations of any foreign jurisdiction.
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19.8 Force Majeure. Neither Agent nor Georgeson will be liable for any delay or failure in performance when such delay or failure arises from circumstances beyond its reasonable control, including without limitation acts of God, acts of government in its sovereign or contractual capacity, acts of public enemy or terrorists, acts of civil or military authority, war, riots, civil strife, terrorism, blockades, sabotage, rationing, embargoes, epidemics, pandemics, outbreaks of infectious diseases or any other public health crises, earthquakes, fire, flood, other natural disaster, quarantine or any other employee restrictions, power shortages or failures, utility or communication failure or delays, labor disputes, strikes, or shortages, supply shortages, equipment failures, or software malfunctions.
19.9 Third Party Beneficiaries. The provisions of this Agreement are intended to benefit only Agent, Georgeson, Purchaser and their respective permitted successors and assigns. No rights shall be granted to any other person by virtue of this Agreement, and there are no third party beneficiaries hereof.
19.10 Survival. All provisions regarding indemnification, warranty, liability and limits thereon, compensation and expenses and confidentiality and protection of proprietary rights and trade secrets shall survive the termination or expiration of this Agreement.
19.11 Priorities. In the event of any conflict, discrepancy, or ambiguity between the terms and conditions contained in (a) this Agreement, (b) any schedules or attachments hereto, and (c) Offer to Purchase, the terms and conditions contained in this Agreement shall take precedence.
19.12 Merger of Agreement. This Agreement constitutes the entire agreement between the parties hereto and supersedes any prior agreement with respect to the subject matter hereof, whether oral or written.
19.13 No Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event any ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by all parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.
19.14 Descriptive Headings. Descriptive headings contained in this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.
19.15 Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. A signature to this Agreement transmitted electronically shall have the same authority, effect, and enforceability as an original signature.
[The remainder of this page has been intentionally left blank. Signature page follows.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement by their duly authorized officers as of Effective Date hereof.
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TORTOISE ENERGY INDEPENDENCE FUND, INC.
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By:
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Name:
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P. Bradley Adams
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Title:
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Chief Executive Officer
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COMPUTERSHARE TRUST COMPANY, N.A., and
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COMPUTERSHARE INC.,
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On behalf of both entities
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By:
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Name:
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Title:
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GEORGESON LLC
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By:
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Name:
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Title:
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Exhibit A
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Tax Instruction and Cost Basis Information Letter
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Exhibit B
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Schedule of Fees
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Exhibit C
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List of affiliates, Ineligible Shares, and Plans
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Exhibit D
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Wire Instructions
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EXHIBIT A;
Section 1
Standard Tax Reporting Instructions
Pursuant to the Emergency Economic Stabilization Act of 2008, financial intermediaries such as Computershare must report cost basis for certain types of securities acquired after January 1, 2011 to both security holders and the IRS. In preparation for the year-end tax reporting to be performed by Computershare under our service agreement for the corporate actions event described in Section 2 of this agreement, please (a) complete the below Year End Tax Reporting Package and (b) provide us with the pertinent issuer statement (i.e., hard copy or website link requested in Section 4 below) as required of issuers under Internal Revenue Code Section 6045B and the underlying Treasury regulations.
In the event that you have not yet produced the issuer statement, kindly provide us with the requisite information at your earliest convenience when completed. You may find it helpful to refer to the below link on the IRS website for some background information regarding the issuer’s obligation to produce the issuer statement.
https://www.irs.gov/forms-pubs/form-8937-report-of-organizational-actions-affecting-basis-of-securities
Please review, complete, execute and return the Year End Tax Reporting Package or the Form 8937, attached documents via e-mail. By requesting cost basis information, Computershare has fulfilled its regulatory obligation. Failure to provide correct basis information may result in a liability to you as an issuer, but if we can provide additional details, please feel free to call upon us.
Additional information may be required based on the completion of the information provided below.
PLEASE NOTE: If IRC sections 302/304 apply to this Corporate Actions event, please reach out to the Corporate Actions Relationship Manager listed on Wire Instruction Exhibit of this Agreement to provide further details.
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Year End Tax Reporting Package
Computershare cannot provide tax advice for purposes of completing this worksheet. Please consult your tax counsel to determine your respective tax reporting requirements.
Shareholder accounts without certified TIN, or certification of foreign status on our system of record will be subject to backup withholding tax at the applicable rate in accordance with IRS rules and regulations regarding 1099 tax reporting. The applicable backup withholding tax deducted from their payment will be remitted to the Internal Revenue Service (IRS). Holders will need to claim any refund of over withholding directly from the IRS and not Computershare. Please note residents or holders that are uncertified, and reside in the state of CA will be withheld an additional 7% which will be remitted to the state of CA.
Important: Computershare uses Constructive Receipt (refer to below definition) reporting for its standard tax reporting default. Deviations from our Standard Default Tax Terms, late submissions and subsequent corrections after the event is over will be subject to additional fees, by appraisal. If Computershare does not receive the completed tax letter by the expiration of the offer/effective date of the distribution or exchange, Computershare will use our Standard Default Tax Terms.
Computershare will perform form suppression on de minimis reporting for the following: on 1099-B tax forms less than $20 in proceeds and fractional share issuance if no withholding; 1099-DIV tax forms less than $10 in dividend income if no withholding.
Computershare will not be liable for any IRS penalties resulting from any client changes to this tax letter or client delay in any final tax instructions that will alter our initial tax reporting instructions. Should any withholding be remitted late to the IRS as a result of any changes to your initial tax reporting instructions. Company and/or Purchaser will be responsible for obligations related to penalties and interest as noted under the Section of the Agreement titled “Indemnification and Limitation of Liability.”
Definitions:
Constructive Receipt: Constructive Receipt means that any corporate action exchange proceeds would be reported to the IRS in the year the merger is effective, whether or not the shareholder has presented the requisite and valid documentation in such year.
Standard Default Tax Terms: The share consideration (if any) is considered a non-taxable event with no Fair Market Value Reporting (FMV) on shares. Principal and CIL are reported on form 1099B as constructive receipt. In the event of an exchange, dividends declared after the effective date, will accrue on the shares issuable to un-exchanged holders and tax reported “as if” paid currently.
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Section 2 — Client Information
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Client Name:
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Tortoise Energy Independence Fund, Inc.
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Issue Description/Type:
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Regulated Investment Company (RIC)
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CUSIP
Number(s):
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89148K200
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Will you require Computershare to perform tax reporting services for this transaction?
***If you mark the above box “No”, an explanation of either how the consideration will be tax reported, or why tax reporting is not applicable (i.e. K1, W-2, etc.), is required. Please provide this explanation in Section 5 where it indicates “If you answered “No” in Section 2.
Section 3 — Standard 1099 Reporting
3.A — Principal payment/cash in lieu of fractional shares
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If 3.A is not applicable, please check here and move to 3.B
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☐
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Computershare to report principal payment on Form 1099-B.
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Yes, on Form 1099-B
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þ
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Yes, on a form other than Form 1099-B. Please complete Section 3.C
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☐
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Computershare to report cash in lieu payment for fractional shares made to holders.
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Yes, on Form 1099-B
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Yes, on a form other than Form 1099-B. Please complete Section 3.C
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3.B — Dividend Reporting (including accrued dividends for unexchanged accounts)
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If 3.B is not applicable, please check here and move to Section 3.C
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þ
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Dividends that have been paid in conjunction with Corporate Actions payments, deemed or accrued, such payment will be reported as Constructive Receipt on Form 1099-DIV or 1042-S.
Computershare to report dividends on Forms 1099-DIV/1042-S.
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Yes, Form 1099 - DIV/1042 - SB
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Yes, on a form other than Form 1099 - DIV/1042=S.
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☐
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Please explain
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Did the Company and or Purchaser distribute qualified dividends (100% ordinary & 100% qualified) for this tax year on the Newco shares?
*If no, please provide us with your worksheet to ensure all reportable income or reclassification income, paid by Computershare as agent, is reported correctly. Please note that up to five decimal points can be utilized in the reallocation process. If you choose to use less than five decimal points this could result in rounding issues. Due to time constraints inherent with tax season, we will not be able to re-run tax forms due to rounding issues. Please provide us with your worksheet reflecting all distributions for this applicable tax year.
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3.C — Additional reporting
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If 3.C is not applicable, please check here and move to Section 4
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þ
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Does any of the following reporting need to be performed by Computershare for cash paid (i.e., principal, cash in lieu) if not to be tax reported on Form 1099-B?
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1099-INT
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1099-OID
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1099-MISC
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1099-DIV
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1042-S
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If you selected 1099-INT, 1099-OID or 1099-MISC above, please complete the below. Specify which box on the Form should be used for reportable amounts:
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Reporting Box for 1099- INT:
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Reporting Box for 1099- OID:
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Reporting Box for 1099- MISC:
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If you selected 1099-DIV and/or 1042-S above, please complete the below.
Reporting for merger consideration (other than accrued and unpaid dividends as outlined below), on Form 1099-DIV and/or 1042-S is as follows:
Section 4 — Cost Basis
Please provide a copy of the completed Issuer Statement (IRS Form 8937) or link to where the Tax & Cost Basis information can be found. If you are unable to provide the link or information pertaining to the Issuer Statement or such IRS filing requirement does not apply, you must answer the questions below.
What are the Cost Basis implications due to this Corporate Action? Please include the details of any calculation that needs to be applied to existing cost basis, or provide an explanation if the IRS filing requirement for Form 8937 does not apply to this event.
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N/A — Link to Form 8937 will be provided after completion of the offer.
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Section 5 — Additional Information
Did any of the following corporate changes occur during the same year in which this corporate action took place?
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a) Name Change?
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Yes
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No
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b) Tax Id Number Change?
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Yes
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No
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c) CUSIP Number Change?
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Yes
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No
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d) Cash Liquidating Distribution
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Yes
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No
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e) Non-Cash Liquidating Distribution
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Yes
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No
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f) Sale of Rights payment
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Yes
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☐
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No
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þ
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Is any additional tax reporting required, other than what has been stated in Section 3 above (specify below)?
If you answered “No” in Section 2 above indicating that you do not require Computershare to perform tax reporting, please explain below.
Section 6 — Additional Information continued
Is any additional tax withholding required other than what has been stated in Section 3 above (specify below)?
Section 7
Fair Market Value (FMV) Tax Reporting Instructions
Pursuant to the Emergency Economic Stabilization Act of 2008, financial intermediaries such as Computershare must report cost basis for certain types of securities acquired after January 1, 2011 to both security holders and the IRS. In preparation for the year-end tax reporting to be performed by Computershare under our service agreement for the corporate actions event described in Section 1 of this agreement, please (a) complete the below Tax and Cost Basis package and (b) provide us with the pertinent issuer statement (i.e., hard copy or website link requested in Section 8 below) as required of issuers under Internal Revenue Code Section 6045B and the underlying Treasury regulations.
In the event that you have not yet produced the issuer statement, kindly provide us with the requisite information at your earliest convenience when completed. You may find it helpful to refer to the below link on the IRS website for some background information regarding the issuer’s obligation to produce the issuer statement.
https://www.irs.gov/forms-pubs/form-8937-report-of-organizational-actions-affecting-basis-of-securities
Please review, complete, execute and return the below Tax Letter and either the Cost Basis word document or the Form 8937, attached documents via e-mail. By requesting cost basis information, Computershare has fulfilled its regulatory obligation. Failure to provide correct basis information may result in a liability to you as an issuer, but if we can provide additional details, please feel free to call upon us.
Additional information may be required based on the completion of the information provided below.
PLEASE NOTE: If 302/304 Tax Reporting is requirements please reach out to the Corporate Actions Relationship Manager listed on the Wire Instruction Exhibit of this Agreement.
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Year End Tax Reporting Package
Computershare cannot provide tax advice for purposes of completing this worksheet. Please consult your tax counsel to determine your respective tax reporting requirements.
Shareholder accounts without certified TIN, or foreign status on our system of record will be subject to backup withholding tax at the applicable rate in accordance with IRS rules and regulations regarding 1099 tax reporting. The applicable backup withholding tax deducted from their payment will be remitted to the Internal Revenue Service (IRS). Holders will need to claim any refund of over withholding directly from the IRS and not Computershare. Please note residents or holders that are uncertified, and reside in the state of CA will be withheld an additional 7% which will be remitted to the state of CA.
Important: Computershare uses Constructive Receipt reporting for its standard tax reporting default. Deviations from our Standard Default Tax Terms, late submissions and subsequent corrections after the event is over will be subject to additional fees, by appraisal. If Computershare does not receive the completed tax letter by the expiration of the offer/effective date of the distribution or exchange, Computershare will use our Standard Default Tax Terms.
Fair Market Value Reporting (FMV) is subject to additional fees, by appraisal.
Computershare will perform form suppression on de minimis reporting for the following: on 1099-B tax forms less than $20 in proceeds and fractional share issuance if no withholding; 1099-DIV tax forms less than $10 in dividend income if no withholding.
Computershare will not be liable for any IRS penalties resulting from any client changes to this tax letter or client delay in any final tax instructions that will alter our initial tax reporting instructions. Should any withholding be remitted late to the IRS as a result of any changes to your initial tax reporting instructions. Company will be responsible for obligations related to penalties and interest as noted under the Section of the Agreement titled “Indemnification and Limitation of Liability.”
Definitions:
Constructive Receipt: Constructive Receipt means that any corporate action exchange proceeds would be reported to the IRS in the year the merger is finalized, regardless of whether the shareholder has already processed the exchange or not.
Standard Default Tax Terms: The share distribution is considered a non-taxable event with no Fair Market Value Reporting (FMV) on shares. Principal and CIL are reported on form 1099B as constructive receipt. In the event of an exchange, dividends declared after the effective date, will accrue on the shares issuable to un-exchanged holders.
Fair Market Value (FMV) tax reporting: Refers to an exchange where the share consideration) is treated as fully taxable and reportable on Form 1099-B at the per share valuation provided by client.
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Section 8 — Client Information
*If FMV reporting is required, the Issuer (Acquirer) will be deemed the payor and you must provide your EIN for reporting purposes. In addition, Client must provide Computershare with completed IRS Form 2678 in order for Computershare to remit any backup withholding tax to the IRS on client’s behalf.
Will you require Computershare to perform FMV tax reporting services for this transaction?
***If you mark the above box “No” the value of all newly issued shares will NOT be tax reported to the holders and any cost basis and acquisition date of the surrendered target company shares will be carried over to the new shares. Please refer to Section 3.
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Section 9
Fair Market Value reporting
We ask that you read each question below carefully and respond to each question
accordingly as this questionnaire requires a great deal of attention.
Taxable Event Information
Please check one of the boxes below regarding the following statement.
This event requires Fair Market Value (FMV) reporting on Form 1099-B as the share consideration received in this transaction is a taxable event to former target holders and as such the basis of the new shares received will be the FMV rate and become covered shares (i.e., date of acquisition is the effective date).
*If the above statement is “False”, please provide an explanation as to why:
If the FMV share consideration is nontaxable, and not tax reportable, please confirm by checking a box below:
*If you selected “True”, please explain briefly why the FMV share consideration is nontaxable, and whether the “cash” (if any) is tax reportable on Form 1099-B:
**If you selected “False” from the above, is the FMV of the share consideration treated as taxable and reportable on a 1099-B?
*If you selected “No”, please advise on the IRS Form & box number in which it should be reported:
Gross Proceeds Information
If the transaction with a shareholder should be reported on a 1099-B, and the full amount of the consideration is treated as taxable, is the FMV of the stock consideration, as well as the cash (if any), reportable on Form 1099-B in Box 1d as “Proceeds”?
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*If you selected “No”, please advise on the rationale as to why the cash and/or stock is not considered as “ proceeds” for 1099-B reporting purposes:
If Form 1099-B reporting is required, should Box 7 on the Form 1099-B (“Check if loss is not allowed based on amount in 1d”) be checked?
Backup Withholding Information
If you selected “Yes” and indicated that FMV of the share consideration is a taxable exchange and reportable on a 1099-B as “Proceeds”,— please advise on the following questions:
• Is the share consideration subject to backup withholding? (Uncertified accounts would be entitled to a lowered share amount upon exchange due to withholding of shares to satisfy remittance to the IRS.)
*If you selected “No”, please provide the basis for selecting “No” so that Tax can review this further.
If you selected “Yes” and indicated that shares are subject to backup withholding, please confirm the following statement by selecting “Issuer/Acquirer Agrees”:
Computershare is hereby authorized by the Issuer/Acquirer to sell the appropriate number of shares from each shareholder’s share entitlement to cover applicable tax withholding obligations. The withholding obligation arises on the date the reportable consideration is paid. The shares sold to fund any backup withholding will be based on the amount of withholding required. The current share price may not be exactly the FMV price and may result in a shortage or overage that will either need to be returned to the company or covered by the company.
If you would prefer that Computershare does not fund the backup withholding obligation by selling the shares, the Issuer/Acquirer can fund the amount of backup withholding required to remit to the IRS in lieu of selling shares. Should you wish to proceed with this alternative, please select the box below:
Yes, we will fund the entire balance due in one single wire to Computershare for the backup withholding
If you checked the box above, to fund the backup withholding on FMV reporting, the funds you provided will be included in a “gross -up” calculation (to increase a net amount to include deductions, such as taxes, that would be incurred by the receiver) reported on a 1099-B as additional proceeds to the holder.
Fair Market Value (FMV)
Please provide the value per share associated with the FMV reporting of the share consideration:
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Form 8937
Please provide a copy of the Issuer Statement (IRS Form 8937) or link to where the Tax & Cost Basis information can be found. If you are unable to provide the link or information pertaining to the Issuer Statement, you must answer the questions below.
What are the Tax & Cost Basis implications due to this Corporate Action? Please include the details of any calculation that needs to be applied to determine the per share basis of the share consideration received by the target’s holders.
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Exhibit B
SCHEDULE OF FEES
Computershare
To Serve As Depositary,
And
Georgeson as Information Agent, In Connection With
Tortoise Energy Independence Fund, Inc. Self-Tender Offer
A. FEES FOR SERVICES*
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Depository Services
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Event Management
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$
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52,500.00
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Per Fund/CUSIP (First CUSIP is included in above Event Management fee)
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$
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10,000.00
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Per Tender processed
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$
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15.00
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Per Eligible Account (Registered)
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$
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5.00
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Per Payment (Registered)
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$
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4.00
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Per Account – Tax Servicing (Registered)
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$
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2.50
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Per Special Handling Presentation
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By appraisal
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Per Guarantee of Delivery or withdrawal
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$
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20.00
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Calculating pro-rata items, each
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$
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5.00
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Per extension or subsequent offering period, if applicable
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$
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2,500.00
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Tax Administration
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$
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2,500.00
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Expiration other than 5pm EST
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$
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5,000.00
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Information Agent Services
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Base Services (per fund)
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$
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3,000.00
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Dedicated Toll-Free Number, Call Center Staffing and Training
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$
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1,500.00
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Outbound communications to Registered/Retail Holders
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$
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6.50/call
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Inbound communications to call center
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$
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2.75/minute
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Per extension or subsequent offering period, if applicable
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$
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2,000.00
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Directory assistance (if required)
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$
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0.67 per account
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Mobile Phone upcharge
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$
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1.50 per number
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B. SERVICES COVERED
DEPOSITARY — Tender Offer
• Designating an operational team to carry out Depositary duties
• Reviewing the Depositary Agreement and other legal documents
• Interfacing with Georgeson (Info Agent), as necessary
• Reviewing the Communication Package (i.e., Letter of Transmittal (LT), enclosure letters and other documentation
• Converting the Company shareholder files to Computershare’s corporate actions system
• Coordinating tender offer with The Depository Trust and Clearing Corporation to facilitate tenders from brokers and street shareholders
• Receiving, opening and processing returned LTs
• Curing defective LTs, including telephoning and writing shareholders in connection with unsigned or improperly executed LTs
• Canceling surrendered certificates
• Tracking and reporting the number of shares submitted and the submitting shareholders, as follows: Agent shall forward up to 10 reports of tender activity by email beginning the last 2 weeks before the expiration to each of the parties named below as to the following information, based upon a preliminary review as of the close of business on the preceding business day: (i) the number of Shares tendered; (ii) the number of Shares tendered represented by certificates physically held by Agent; (iii) the number of Shares represented by Notices of Guaranteed Delivery; (iv) the number of Shares withdrawn; and (v) the cumulative totals of Shares in categories (i) through (iv) above. At the expiration of the offer Agent shall provide a master list of Shares elected, including a complete list of the electing stockholders. Agent can furnish to the Purchaser, upon reasonable request, additional daily or inter-day ad hoc reports, for an additional fee of $100.00 per report.
• Calculating and issuing checks at the completion of the tender period, assuming receipt of properly executed Letters of Transmittal and surrender of shares
• Issuing tax forms and filing tax information with the IRS, as required
• Enclosing and mailing checks, Forms 1099-B and letters or notices to shareholders
• Replacing checks alleged to have been lost or destroyed
Information Agent — Tender Offer
BASE SERVICES
• Advance review of Offer documents
• Strategic advice relating to the Offer
• Coordination of tombstone advertisement placement in newspapers
• (cost for advertisement additional and dependent upon newspaper and size of advertisement)
• Dissemination of Offer documents to bank and broker community
• Communication with bank and broker community during Offer period
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• Outreach to Professional Investors
• Communication with Depositary Agent to monitor progress of the offer
• Provide progress updates to the advisory team
ADDITIONAL/SUPPLEMENTAL SERVICES
• Dedicated Toll-Free Number, Call Center Staffing and Training
• Outbound communications to Registered/Retail Holders
• Inbound communications to call center
NOTE: The foregoing fees are exclusive of Expenses and custodial charges as described in paragraphs Article II, Sections 3 and 4 of this Agreement.
C. ITEMS NOT COVERED
• All expenses such as ad hoc reports, printing, checks, postage, stationery, wire transfers, etc. (these will be billed as incurred)
D. ASSUMPTIONS
• Fee schedule based upon information known at this time about the transaction
• Significant changes made in the terms or requirements of this transaction could require modifications to this Fee schedule
• Project management fee include pre-launch and ongoing services related to the event, for up to 30 business days. Any application of an additional extension fee will apply for each subsequent two week extension period or any part thereof, of the offer, commencing immediately following the original offer period.
• Fee schedule assumes the use of Computershare’s standard legal agreement and Letter of Transmittal
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Exhibit C
LIST OF AFFILIATES
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Shareholder
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Certificate Numbers of Old Shares
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Disposition
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SHARES INELIGIBLE FOR EXCHANGE
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Shareholder
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Certificate Numbers of Old Shares
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Disposition
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PLANS AFFECTED BY THIS EXCHANGE
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Plan Name
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Plan Administrator
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Disposition
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30
Exhibit D
Wire Instructions
Please wire all funds RELATED to this Transaction using the following instructions:
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Bank Name:
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Account Name:
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Account Number:
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ABA Routing Number:
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Ref:
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If you have any questions, or need additional information please call me.
[______]
Relationship Manager
Corporate Actions
T (XXX) XXX-XXX
XXXXXXXXX.XXXXXXXXXXXX@Computershare.com
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