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EXHIBIT 4.21
INTERCREDITOR AND SUBORDINATION AGREEMENT
THIS INTERCREDITOR AND SUBORDINATION AGREEMENT (this "Intercreditor
Agreement"), dated as of July 31, 2001, is by and among ASSET SEVEN CORP., an
Arizona corporation ("Asset Seven"), each subsidiary of Pulte Homes, Inc. that
from time to time executes an Intercreditor Joinder Agreement (as defined below)
(together with Asset Seven, individually a "Subordinated Creditor" and
collectively the "Subordinated Creditors"), BANK OF AMERICA, N.A., as
administrative agent for the Five Year Lenders from time to time party to the
Five Year Credit Agreement described below (in such capacity, "Bank of
America"), CITICORP REAL ESTATE, INC., as administrative agent for the Bridge
Lenders from time to time party to the Bridge Credit Agreement described below
(in such capacity, "Citicorp"), and BANK ONE TRUST COMPANY, NATIONAL
ASSOCIATION, as trustee for the Noteholders pursuant to the Indenture described
below (in such capacity, the "Trustee").
RECITALS:
A. Pursuant to the terms of that certain Credit Agreement, dated as of
August 31, 2000 (as previously amended, modified or supplemented and as amended,
modified, supplemented or restated from time to time, the "Five Year Credit
Agreement"), among Pulte Homes, Inc. f/k/a Pulte Corporation (the "Borrower"),
the Material Subsidiaries of the Borrower (the "Guarantors"), the lenders from
time to time party thereto (the "Five Year Lenders") and Bank of America, the
Five Year Lenders have provided a revolving credit facility to the Borrower.
B. Pursuant to the terms of that certain Credit Agreement, dated as of
the date hereof (as amended, modified, supplemented or restated from time to
time, the "Bridge Credit Agreement"), among the Borrower, the Guarantors, the
lenders party thereto (the "Bridge Lenders") and Citicorp, the Bridge Lenders
have provided a bridge loan credit facility to the Borrower.
C. The Borrower has issued and may issue from time to time senior
unsecured notes (the "Senior Notes") pursuant to that certain indenture, dated
as of October 24, 1995, or a supplement thereto (as previously amended, modified
or supplemented and as amended, modified, supplemented or restated from time to
time, the "Indenture").
D. The Subordinated Creditors are holders of promissory notes (the
"Subordinated Notes") from certain subsidiaries of the Borrower (the "Note
Issuers"), which Subordinated Notes are secured by mortgages on certain real
properties owned by the Note Issuers (the "Collateral").
E. Each Subordinated Creditor is a subsidiary of the Borrower.
F. In order to induce the Five Year Lenders, the Bridge Lenders and the
holders of the Senior Notes (the "Noteholders") to provide or continue to
provide the financial
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accommodations to the Borrower under the Five Year Credit Agreement, the Bridge
Credit Agreement and the Senior Notes (collectively, the "Senior Loan Documents"
and individually, a "Senior Loan Document"), and because of the direct benefit
to the Subordinated Creditors of such financial accommodations, Bank of America,
Citicorp and the Trustee have agreed to enter into this Intercreditor Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
Definitions
1.1 Certain Defined Terms. For the purposes hereof:
(a) "Code" means the Internal Revenue Code of 1986 and the
rules and regulations promulgated thereunder, as amended, modified,
succeeded or replaced from time to time. References to sections of the
Code should be construed also to refer to any successor sections.
(b) "Event of Default" means (i) an "Event of Default" as
defined in the Five Year Credit Agreement, (ii) an "Event of Default"
as defined in the Bridge Credit Agreement or (iii) an event of default
under the Senior Notes or the Indenture.
(c) "Senior Creditors" means (i) so long as any Senior
Obligations (or commitments with respect thereto) remains outstanding
under the Five Year Credit Agreement, Bank of America, (ii) so long as
any Senior Obligations (or commitments with respect thereto) remains
outstanding under the Bridge Credit Agreement, Citicorp, and (iii) so
long as any Senior Obligations (or commitments with respect thereto)
remains outstanding under the Senior Notes, the Trustee.
(d) "Senior Obligations" means (i) the "Credit Party
Obligations" as defined in the Five Year Credit Agreement, (ii) the
"Credit Party Obligations" as defined in the Bridge Credit Agreement
and (iii) all obligations (including, without limitation, principal,
interest and fees) outstanding under the Senior Notes.
(e) "Subordinated Obligations" means (i) the principal amount
of, and accrued interest (including, without limitation, any interest
which accrues after the commencement of any case, proceeding or other
action relating to the bankruptcy, insolvency or reorganization of a
Note Issuer) on any Subordinated Note, and (ii) all other indebtedness,
obligations and liabilities of the Note Issuers to the Subordinated
Creditors now existing or hereafter incurred.
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(f) "Intercreditor Joinder Agreement" means an intercreditor
joinder agreement in substantially the form of Exhibit A attached
hereto.
1.2 Other Definitional Provisions. The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Intercreditor
Agreement shall refer to this Intercreditor Agreement as a whole and not to any
particular provision of this Intercreditor Agreement, and section, subsection,
schedule and exhibit references are to this Intercreditor Agreement unless
otherwise specified. Defined terms herein shall include in the singular number
the plural and in the plural the singular.
ARTICLE II
Terms of Subordination
2.1 Subordination.
(a) Each of the Subordinated Creditors agrees, for itself and
each future holder of the Subordinated Obligations held by such
Subordinated Creditor, that the Subordinated Obligations are expressly
subordinate and junior in right of payment (as defined in subsection
2.1(b)) to all Senior Obligations in all respects.
(b) "Subordinate and junior in right of payment" shall mean
that:
(i) Upon the occurrence and during the continuance of
an Event of Default, none of the Subordinated Creditors will,
without the express prior written consent of the Senior
Creditors or unless otherwise instructed by the Senior
Creditors, take, demand or receive, directly or indirectly, by
set-off, redemption, purchase or in any other manner, any
payment on or security for the whole or any part of the
Subordinated Obligations, and, without the express prior
written consent of the Senior Creditors or unless otherwise
instructed by the Senior Creditors, none of the Subordinated
Creditors will make demand for the payment of or accelerate
the scheduled maturities of any amounts owing under the
Subordinated Obligations.
(ii) Until the Senior Obligations shall have been
paid in full and satisfied, upon the occurrence and during the
continuance of an Event of Default, none of the Subordinated
Creditors will accelerate, declare to be immediately due and
payable, enforce or take any action to enforce or collect, or
otherwise exercise any rights or remedies it may possess with
respect to the Subordinated Obligations or any portion
thereof, or take any action to enforce or otherwise exercise
any rights or remedies with respect to, or realize upon, the
Collateral, in each case without the prior written consent of
the Senior Creditors.
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(iii) Without limiting the generality of the
foregoing provisions of this Section 2.1, in the event of any
liquidation, termination, revocation or other winding-up of a
Note Issuer, or in the event of any receivership, insolvency,
reorganization or bankruptcy proceedings, assignment for the
benefit of creditors or any proceeding by or against a Note
Issuer for any relief under any bankruptcy, reorganization or
insolvency law or laws (federal or state) or any law (federal
or state) relating to the relief of debtors, readjustment of
indebtedness, reorganization, composition or extension of
indebtedness, then, upon the occurrence and during the
continuance of an Event of Default, unless otherwise agreed to
or instructed in writing by the Senior Creditors, all Senior
Obligations shall first be paid in full before any payment or
distribution is made in respect of the Subordinated
Obligations, and any payment or distribution of any kind or
character (whether in cash, property or securities) that, but
for the subordination provisions contained herein, would
otherwise be payable or deliverable to a Subordinated Creditor
upon or in respect of the Subordinated Obligations, shall
instead be paid over or delivered to the Senior Creditors or
their representatives, and such Subordinated Creditor shall
not receive any such payment or distribution or any benefit
therefrom unless and until the Senior Obligations shall have
been fully paid and satisfied.
2.2 Power of Attorney; Agreement to Cooperate. Each of the Subordinated
Creditors hereby agrees, upon the occurrence of an Event of Default, to duly and
promptly take such action as may be requested at any time and from time to time
by the Senior Creditors, to file appropriate proofs of claim in respect of the
Subordinated Obligations, and to execute and deliver such powers of attorney,
assignment of proofs of claim or other instruments as may be requested by the
Senior Creditors in order to enable the Senior Creditors to enforce any and all
claims upon or in respect of the Subordinated Obligations and to collect and
receive any and all payments or distributions which may be payable or
deliverable at any time upon or in respect of the Subordinated Obligations.
2.3 Payments Received by a Subordinated Creditor. Should any payment or
distribution or security or realization of the Collateral, or the proceeds of
any thereof, be collected or received by a Subordinated Creditor in respect of
the Subordinated Obligations, and such collection or receipt is received in a
receivership, insolvency, reorganization or bankruptcy proceeding involving a
Note Issuer or is not expressly permitted hereunder, the Subordinated Creditor
will forthwith turn over the same to the Senior Creditors in the form received
(except for endorsement or assignment by the Subordinated Creditor when
necessary) to be applied to the Senior Obligations and, until so turned over,
the same shall be held in trust by the Subordinated Creditor as the property of
the Senior Creditors.
2.4 Subrogation. The Subordinated Creditors shall not be subrogated to
the rights of the Senior Creditors to receive payments or distributions of
assets of the Note Issuers for the Senior Obligations.
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2.5 Application of Payments Among Senior Creditors. Any payment with
respect to the Senior Obligations or received by a Senior Creditor pursuant to
the terms of this Intercreditor Agreement shall be applied pro rata to the
Senior Obligations outstanding under the Five Year Credit Agreement, the Bridge
Credit Agreement and the Senior Notes based on the aggregate amount of Senior
Obligations outstanding under the Five Year Credit Agreement, the Bridge Credit
Agreement and the Senior Notes, respectively, on the date of such payment, as
certified by Bank of America, Citicorp and the Trustee, respectively, to the
other Senior Creditors.
ARTICLE III
Representations and Warranties
3.1 Each of the Subordinated Creditors represents and warrants to the
Senior Creditors that:
(a) Subordinated Obligations. The Subordinated Obligations are
payable solely and exclusively to the Subordinated Creditors and to no
other person, firm, corporation or other entity, without deduction for
any defense, offset or counterclaim.
(b) Power and Authority; Authorization; No Violation. Each
Subordinated Creditor has full power, authority and legal right to
execute, deliver and perform this Intercreditor Agreement, and, the
execution, delivery and performance of this Intercreditor Agreement
have been duly authorized by all necessary action on the part of such
Subordinated Creditor, do not require any approval or consent of any
holders of any indebtedness or obligations of such Subordinated
Creditor and will not violate any provision of law, governmental
regulation, order or decree or any provision of any indenture,
mortgage, contract or other agreement to which such Subordinated
Creditor is party or by which such Subordinated Creditor is bound.
(c) Consents. No consent, license, approval or authorization
of, or registration or declaration with, any governmental
instrumentality, domestic or foreign, is required in connection with
the execution, delivery and performance by the Subordinated Creditor of
this Intercreditor Agreement.
(e) Binding Obligation. This Intercreditor Agreement
constitutes a legal, valid and binding obligation of the Subordinated
Creditor enforceable in accordance with its terms.
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ARTICLE IV
Modification of Senior
Obligations; Reliance
4.1 Each of the Subordinated Creditors agrees that, without the
necessity of any reservation of rights against such Subordinated Creditor and
without notice to or further assent by such Subordinated Creditor, (a) any
demand for payment of any Senior Obligation may be continued, and the Senior
Obligations or the liability of the Borrower or any of its subsidiaries for any
part thereof, or any guaranty therefor, or right of offset with respect thereto,
may, from time to time, in whole or in part, be renewed, extended, modified,
accelerated, compromised, waived, surrendered, or released and (b) any document
or instrument evidencing or governing the terms of the Senior Obligations or
guaranties or documents in connection with the Senior Obligations may be
amended, modified, supplemented or terminated, in whole or in part, as the
applicable Senior Creditor may deem advisable from time to time, in each case
all without notice to or further assent by such Subordinated Creditor, which
will remain bound under this Intercreditor Agreement, and all without impairing,
abridging, releasing or affecting the subordination provided for herein,
notwithstanding any such renewal, extension, modification, acceleration,
compromise, amendment, supplement, termination, waiver, surrender or release.
Each of the Subordinated Creditors waives (i) any and all notice of the
creation, modification, renewal, extension or accrual of any of the Senior
Obligations and (ii) notice of or proof of reliance on this Intercreditor
Agreement and protest, demand for payment and notice of an Event of Default. The
Senior Obligations shall conclusively be deemed to have been created,
contracted, incurred or continued in reliance upon this Intercreditor Agreement,
and all dealings between or among the Note Issuers and the Senior Creditors
shall be deemed to have been consummated in reliance upon this Intercreditor
Agreement. The Subordinated Creditors acknowledge and agree that the Senior
Creditors, the Five Year Lenders, the Bridge Lenders and the Noteholders have
relied upon the subordination provided for herein in making the Senior
Obligations available to the Borrower.
ARTICLE V
No Transfer of Subordinated Obligations or Collateral
5.1 The Subordinated Creditors will not (a) sell, assign or otherwise
transfer, in whole or in part, any Subordinated Obligation or any Collateral
held by the Subordinated Creditors or any interest therein to any other person
or entity (a "Transferee") other than a Subordinated Creditor or (b) create,
incur or suffer to exist any security interest, lien, charge or other
encumbrance whatsoever upon the Subordinated Obligations or the Collateral in
favor of any Transferee.
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ARTICLE VI
Joinder of Other Subordinated Creditors
6.1 Any subsidiary of the Borrower that properly elects to be taxed as
a real estate investment trust under Section 856(c) of the Code may become a
Subordinated Creditor hereunder by executing and delivering an Intercreditor
Joinder Agreement. Upon receipt by the Senior Creditors of an Intercreditor
Joinder Agreement from a subsidiary of the Borrower, such subsidiary shall be
considered a Subordinated Creditor under the terms of this Intercreditor
Agreement.
ARTICLE VII
Miscellaneous
7.1 No Waiver; Cumulative Remedies. No failure or delay on the part of
any Senior Creditor, Five Year Lender, Bridge Lender or Noteholder in exercising
any right, power or privilege hereunder or under any Senior Loan Document or any
other loan document entered into in connection therewith and no course of
dealing between the Subordinated Creditors and any Senior Creditor, Five Year
Lender, Bridge Lender or Noteholder shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, power or privilege hereunder or
under any other Senior Loan Document or any other loan document entered into in
connection therewith preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder or thereunder. The
rights and remedies provided herein are cumulative and not exclusive of any
rights or remedies which the Senior Creditors, the Five Year Lender, the Bridge
Lenders and the Noteholders would otherwise have. No notice to or demand on any
Subordinated Creditor in any case shall entitle such Subordinated Creditor to
any other or further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the Senior Creditors, the Five Year
Lenders, the Bridge Lenders and the Noteholders to any other or further action
in any circumstances without notice or demand.
7.2 Further Assurances. The Subordinated Creditors agree, upon the
request of a Senior Creditor, to promptly take such actions, as reasonably
requested, as is necessary to carry out the intent of this Intercreditor
Agreement.
7.3 Notices. All notices and other communications with respect to this
Intercreditor Agreement shall have been duly given and shall be effective (a)
when delivered in writing, (b) when transmitted via telecopy (or other facsimile
device) to the number set out below, (c) the business day following the day on
which the same has been delivered prepaid (or on an invoice basis) to a
reputable national overnight air courier service, or (d) the third business day
following the day on which the same is sent by certified or registered mail,
postage prepaid, in each case to the respective parties at the address or
telecopy numbers set forth below or at such other address as such party may
specify by written notice to the other parties hereto.
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To Bank of America: Bank of America, N.A.
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Ph: 312/923-0207
Fax: 312/▇▇▇-▇▇▇▇
To Citicorp: Citicorp Real Estate, Inc.
Global Loan Support Service Center
▇ ▇▇▇▇'▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
Ph: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To the Trustee: Bank One Trust Company, National Association
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Attn:
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Ph:
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Fax:
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7.4 Governing Law; Jurisdiction.
(a) THIS INTERCREDITOR AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Any legal action or proceeding with respect to this Intercreditor
Agreement may be brought in the courts of the State of New York or of
the United States for the Southern District of New York, and, by
execution and delivery of this Intercreditor Agreement, each party
hereto hereby irrevocably accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of such
courts. Each party hereto further irrevocably consents to the service
of process out of any of the aforementioned courts in any such action
or proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid, to it at the address for notices
pursuant to Section 7.3, such service to become effective 20 days after
such mailing. Nothing herein shall affect the right of a Senior
Creditor to serve process on a Subordinated Creditor in any other
manner permitted by law or to commence legal proceedings or to
otherwise proceed against a Subordinated Creditor in any other
jurisdiction.
(b) Each party hereto hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Intercreditor Agreement brought in the courts referred to in
subsection (a) hereof and hereby further irrevocably waives and
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agrees not to plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an
inconvenient forum.
7.5 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS INTERCREDITOR
AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS INTERCREDITOR
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
7.6 Successors and Assigns. This Intercreditor Agreement shall be
binding upon and inure to the benefit of the Senior Creditors, the Subordinated
Creditors, and their respective successors, transferees and assigns.
7.7 Severability. If any provision of any of this Intercreditor
Agreement is determined to be illegal, invalid or unenforceable, such provision
shall be fully severable and the remaining provisions shall remain in full force
and effect and shall be construed without giving effect to the illegal, invalid
or unenforceable provisions.
7.8 Counterparts. This Intercreditor Agreement may be executed in any
number of counterparts, each of which where so executed and delivered shall be
an original, but all of which shall constitute one and the same instrument.
Delivery of executed counterparts by telecopy shall be as effective as an
original and shall constitute a representation that an original will be
delivered.
7.9 Waivers, Amendments, Etc. This Intercreditor Agreement may not be
rescinded or canceled or modified in any way, nor may any provision of this
Intercreditor Agreement be waived or changed without the express prior written
consent thereto of the Senior Creditors.
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IN WITNESS WHEREOF, the parties hereto have caused this Intercreditor
Agreement to be executed as of the day and year first above written.
SUBORDINATED CREDITOR: ASSET SEVEN CORP.,
an Arizona corporation
By:
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Name:
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Title:
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SENIOR CREDITOR: BANK OF AMERICA, N.A.,
as administrative agent for the Five
Year Lenders
By:
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Name:
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Title:
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SENIOR CREDITOR: CITICORP REAL ESTATE, INC.,
As administrative agent for the Bridge
Lenders
By:
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Name:
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Title:
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SENIOR CREDITOR: BANK ONE TRUST COMPANY, NATIONAL
ASSOCIATION, as Trustee
By:
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Name:
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Title:
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EXHIBIT A
Form of Intercreditor Joinder Agreement
THIS INTERCREDITOR JOINDER AGREEMENT (this "Agreement"), dated as of
, is entered into among , a (the "New REIT") and BANK OF
AMERICA, N.A., CITICORP REAL ESTATE, INC. and BANK ONE TRUST COMPANY, NATIONAL
ASSOCIATION, in their capacity as Senior Creditors (the "Senior Creditors")
under that certain Intercreditor and Subordination Agreement, dated as of July
, 2001, among ASSET SEVEN CORP., an Arizona corporation ("Asset Seven"), the
other Subordinated Creditors party thereto and the Senior Creditors (as the same
may be amended, modified, extended or restated from time to time, the
"Intercreditor Agreement"). All capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the Intercreditor Agreement.
The New REIT and the Senior Creditors hereby agree as follows:
1. The New REIT hereby acknowledges, agrees and confirms that, by its
execution of this Agreement, the New REIT will be deemed to be a Subordinated
Creditor under the Intercreditor Agreement and shall have all of the rights and
obligations of a Subordinated Creditor thereunder as if it had executed the
Intercreditor Agreement. The New REIT hereby ratifies, as of the date hereof,
and agrees to be bound by, all of the terms, provisions and conditions contained
in the Intercreditor Agreement, including without limitation, all of the
subordination terms set forth in Article II of the Intercreditor Agreement.
2. This Agreement may be executed in any number of counterparts, each
of which where so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. Delivery of executed counterparts
by telecopy shall be as effective as an original and shall constitute a
representation that an original will be delivered.
3. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the New REIT has caused this Agreement to be duly
executed by its authorized officer, as of the day and year first above written.
[NEW REIT]
By:
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Name:
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Title:
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Acknowledged and Accepted:
BANK OF AMERICA, N.A., as administrative agent,
in its capacity as a Senior Creditor
By:
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Name:
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Title:
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CITICORP REAL ESTATE, INC., as administrative agent,
in its capacity as a Senior Creditor
By:
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Name:
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Title:
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BANK ONE TRUST COMPANY, NATIONAL ASSOCIATION,
as Trustee, in its capacity as a Senior Creditor
By:
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Name:
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Title:
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