9/06 AMENDMENT TO CREDIT AGREEMENT effective as of September 13, 2006 amending the 8/05 AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT dated as of August 1, 2005 by and among HOMEBANC CORP. and HOMEBANC MORTGAGE CORPORATION and JPMORGAN CHASE BANK, N.A. as Administrative Agent, Collateral Agent and a Lender, and the other Lender(s) parties hereto KEYBANK NATIONAL ASSOCIATION as Syndication Agent COMMERZBANK, A.G., NEW YORK BRANCH and GRAND CAYMAN BRANCH, U.S. BANK NATIONAL ASSOCIATION, BNP PARIBAS and UNITED OVERSEAS BANK LIMITED, NEW YORK AGENCY as Documentation Agents J.P. MORGAN SECURITIES INC. Sole Bookrunner and Lead Arranger $500,000,000 Senior Secured Revolving Credit Index of Defined Terms
EXHIBIT 10.1
9/06 AMENDMENT TO CREDIT AGREEMENT
effective as of September 13, 2006
amending the
8/05 AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT
dated as of August 1, 2005
by and among
HOMEBANC CORP.
and
HOMEBANC MORTGAGE CORPORATION
and
JPMORGAN CHASE BANK, N.A.
as Administrative Agent, Collateral Agent and a Lender,
and
the other Lender(s) parties hereto
KEYBANK NATIONAL ASSOCIATION
as Syndication Agent
COMMERZBANK, A.G., NEW YORK BRANCH and GRAND CAYMAN BRANCH,
U.S. BANK NATIONAL ASSOCIATION,
BNP PARIBAS
and
UNITED OVERSEAS BANK LIMITED, NEW YORK AGENCY
as Documentation Agents
J.P. MORGAN SECURITIES INC.
Sole Bookrunner
and Lead Arranger
$500,000,000 Senior Secured Revolving Credit
Index of Defined Terms
Page
| 8/05 Credit Agreement | 1 |
| 9/06 Amendment | 1 |
| 9/06 Amendment Effective Date | 1 |
| Agent | 1 |
| Amendment | 1 |
| Companies | 1 |
| Company | 1 |
| Current Credit Agreement | 1 |
| HC | 1 |
| HMC | 1 |
| JPMorgan | 1 |
| Lenders | 1 |
| Qualified Trust Preferred Securities | 2 |
Table of Contents
Page
| 1 | DEFINITIONS | 2 |
| 7 | COLLATERAL | 3 |
| 8 | CONDITIONS PRECEDENT | 3 |
| 9 | REPRESENTATIONS | 3 |
| 11 | NEGATIVE COVENANTS | 4 |
| 16 | MISCELLANEOUS | 4 |
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9/06 AMENDMENT TO CREDIT AGREEMENT
Preamble
This 9/06 Amendment to Credit Agreement (the “9/06 Amendment” or, within itself only, this “Amendment”) effective as of September 13, 2006 (the “9/06 Amendment Effective Date”) amending (for the fifth time) the 8/05 Amended and Restated Senior Secured Credit Agreement (the “8/05 Credit Agreement” and as it may be supplemented, amended or restated, the “Current Credit Agreement”), executed as of August 1, 2005, among:
(i) HOMEBANC CORP., a Georgia corporation (“HC”), its wholly-owned subsidiary, HOMEBANC MORTGAGE CORPORATION, a Delaware corporation (“HMC” HC and HMC being sometimes referred to individually as a “Company” and together as the “Companies”), each having its principal office at 2002 Summit Boulevard, Suite 100, Atlanta, Georgia 30319;
(ii) JPMORGAN CHASE BANK, N.A. (“JPMorgan”), a national banking association, acting herein as a Lender and agent and representative of the other Lenders (in that capacity JPMorgan is called the “Agent”); and
(iii) such other Lenders as may from time to time be party to this Agreement (together with JPMorgan as a lender, the “Lenders”).
HOUSTON: 007002.04171: 1115231v4
Each of the parties hereto recites and provides as follows:
Recitals
The Companies have asked the Lenders and the Agent to amend the Debt limitation covenant of the 8/05 Credit Agreement, as heretofore amended, to (i) increase to $200 million the limitation on Qualified Trust Preferred Securities that HC or HMC are permitted to issue and (ii) permit the Companies to issue up to an aggregate $200 million of convertible Debt so long as all of such convertible Debt is subordinated, in form acceptable to the Agent, to the Debt under this Facility, and the Lenders and the Agent have agreed to do so on the terms and subject to the conditions of this Amendment and provided that the Companies’ agreements with the Lenders and the Agent that are set forth in the December 15, 2005 letter agreement between the Companies and the Agent are expanded and set forth in this Amendment.
All capitalized terms used in the 8/05 Credit Agreement and used but not defined differently in this Amendment have the same meanings here as there.
The Sections of this Amendment are numbered to correspond with the numbers of the Sections of the 8/05 Credit Agreement amended hereby and are accordingly often nonsequential.
If there is any conflict or inconsistency between (i) these recitals and the following agreements; (ii) any of the terms or provisions of any of the other Facilities Papers and this Amendment; or (iii) any provision of this Amendment and any later supplement, amendment, restatement or replacement of it then in each case the latter shall govern and control.
Agreements
In consideration of the premises, the mutual agreements stated below and other good and valuable consideration paid by each party to each other party to this Amendment, the receipt and sufficiency of which each hereby acknowledges, the parties hereby agree as follows.
1 DEFINITIONS
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| 1.1. | Defined Terms. Effective from and after the 9/06 Amendment Effective Date: |
A. The following new definitions are added to Section 1.2 of the Current Credit Agreement, in alphabetical order (except where otherwise specified).
“9/06 Amendment” means the 9/06 Amendment to Credit Agreement effective as of September 13, 2006, amending this Agreement.
“9/06 Amendment Effective Date” means September 13, 2006, the effective date of the 9/06 Amendment.
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| B. | The following definition is amended in its entirety to henceforth read as follows: |
“Qualified Trust Preferred Securities” means trust preferred securities, including all junior subordinated debentures and guaranties related to the issuance of such trust preferred securities, issued by a Capital Trust Entity, provided such issued securities, debentures and guaranties qualify as Qualified Subordinated Debt and whose indentures, if issued after June 28, 2005, contain substantially the following provision (with the Article and section number references adjusted as necessary to reference appropriate Sections of the indenture):
Notice to Senior Indebtedness Holders’ Agent. JPMorgan Chase Bank, N.A. (“Chase”), acting in its capacity as agent and representative of the present and future holders of the Senior Indebtedness (in that capacity, Chase is herein referred to as the “Agent”) under the 12/05 Amendment to the Amended and Restated Senior Secured Credit Agreement among the Company, Chase and certain lenders, as it may be supplemented, amended, restated or replaced from time to time, has consented to this Indenture conditioned on inclusion of the provisions of this Section 15.7 and the other provisions of this Article XV. Upon the occurrence of any default under Section 5.1(a) [the Company’s defaults in the payment of any interest on any Debenture, including any Additional Interest] or Section 5.1(c) [defaults in performance, or breaches, of any of the Company’s covenants or agreements in the indenture or in the terms of the debentures (other than a covenant or agreement a default in whose performance or whose breach is elsewhere in such Section of such indenture specifically dealt with)], the Trustee shall use commercially reasonable efforts to promptly give to the Agent, by registered or certified mail, a written notice specifying such default or breach; provided that the Trustee shall not, and shall not be deemed to, be liable to the Agent, and of such lenders or any other Person (other than for the willful misconduct or gross negligence of the Trustee) if the Trustee fails for any reason to give such written notice. Such notice shall be given to the Agent addressed to the Agent at 707 Travis, 6th Floor North, Houston, Texas 77002, or to such successor agent and/or such other address as shall have been specified in a written notice actually received by the Trustee at least ten (10) Business Days in advance of the giving of such written notice by the Trustee. No failure of the Trustee to give any notice under this Section 15.7 shall constitute a default under Section 5.1 or otherwise under the 12/05 Amended and Restated Senior Credit Agreement.
C. Exhibit 9/06-E attached to this Amendment is hereby substituted for Exhibit 12/05-E to the 12/05 Amendment (which was substituted by the 12/05 Amendment for Exhibit E to the 8/05 Credit Agreement.)
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7 COLLATERAL
The provisions of Section 7.1 of the 8/05 Credit Agreement are not otherwise amended hereby. Cumulative of such existing provisions, as security for the payment of the Loan and for the payment and performance of all of the Obligations, each Company hereby GRANTS to the Agent (as agent and representative of the Lenders) a first priority security interest in all of such Company’s present and future estate, right, title and interest in and to the Collateral, in addition to and cumulative of the security interest in the Collateral granted to the Agent in the 8/05 Credit Agreement and in the previous amendments to the 8/05 Credit Agreement, and the parties hereby declare and confirm that all such security interests were and are granted to and held by the Agent (as agent and representative of the Lenders.)
8 CONDITIONS PRECEDENT
Section 8 of the 8/05 Credit Agreement is further amended by adding the following new Section 8.6 to the end of Section 8, viz.:
8.6 Borrowings After the 9/06 Amendment Effective Date. In addition to the conditions precedent stated in Sections 8.1, 8.2, 8.3, 8.4 and 8.5 above, the obligations of the Lenders to fund and the Agent to disburse any Advances under this Agreement after the 9/06 Amendment Effective Date are subject to the condition precedent that the Agent shall have received:
(a) the 9/06 Amendment, duly executed by each Company, the Agent and the Required Lenders;
(b) a certificate of each Company’s corporate secretary (i) as to the incumbency of the officers of such Company executing the 9/06 Amendment and all other Facilities Papers executed or to be executed by or on behalf of such Company in connection with the 9/06 Amendment, (ii) as to the authenticity of their signatures (specimens of their signatures shall be included in such certificate or set forth on an exhibit attached to it, and the Agent and the Lenders shall be entitled to rely on that certificate until such Company has furnished a new certificate to the Agent) and (iii) that there have been no amendments to the Company’s certificate of incorporation or bylaws since September 30, 2005; and
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| (c) | such other documents, if any, as shall be specified by the Agent. |
9 REPRESENTATIONS
Each Company hereby republishes its warranties and representations made in the 8/05 Credit Agreement effective (except as to those specified to relate only to a specific date) as of the 9/06 Amendment Effective Date.
10 AFFIRMATIVE COVENANTS
A new Section 10.21 is hereby added to the end of Section 10, as follows:
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10.21 Notice of Defaults under Indentures. The Companies will give written notice to the Agent promptly, and in no event later than ten (10) days, after the occurrence of (i) any “Event of Default”, (ii) any principal payment default, (iii) any interest or premium payment default or (iii) any performance default or breach of any covenant other than default in the payment of principal, interest or premium, under the trust indenture related to (x) the Qualified Trust Preferred Securities issued by any Capital Trust Entity or (y) any issue of HC Debt convertible into HC common stock.
11 NEGATIVE COVENANTS
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| Section 11.4 (f) is amended to henceforth read as follows: |
11.4(f) Debt Limitation. Incur any Debt for borrowed money or for the deferred purchase price of property or services other than (i) Debt to the Lenders under this Agreement; (ii) Debt under warehousing, repurchase or other mortgage-related asset agreements to finance the Companies’ inventory of Mortgage Loans and other mortgage-related assets; (iii) accounts payable incurred in the ordinary course of business with standard payment terms; (iv) Debt of up to Twenty Million Dollars ($20,000,000) incurred in the ordinary course of business (for purposes of this provision, junior subordinated debt to support trust common securities issued by HC or HMC concurrently and in connection with the issuance of junior subordinate debentures issued by HC or HMC shall be deemed debt incurred in the ordinary course of business); (v) Debt of one Company owed to the other Company, so long as such inter-company Debt is subordinated, in form acceptable to the Agent, to the Debt under this Facility; (vi) Debt of up to Two Hundred Million Dollars ($200,000,000) issued by HC or HMC to support the issuance of Qualified Trust Preferred Securities and related common securities by any and all Capital Trust Entities and (vii) Debt securities issued by HC convertible into common stock, of up to Two Hundred Million Dollars ($200,000,000), so long as such convertible Debt is unsecured and does not mature until ninety (90) days or more after the Maturity Date, and its indenture contains subordination provisions approved by the Agent subordinating such convertible Debt in right of payment to the Loan and imposes covenants and conditions that are no more restrictive or onerous than HC’s covenants and conditions under this Agreement.
16 MISCELLANEOUS
Section 16.11 is amended to read as follows:
16.11 Notice Pursuant to Tex. Bus. & Comm. Code §26.02. THE 8/05 CREDIT AGREEMENT, AS AMENDED BY THE 9/05 AMENDMENT, THE 9/06 AMENDMENT AND THE OTHER FACILITIES PAPERS TOGETHER CONSTITUTE A WRITTEN LOAN AGREEMENT WHICH REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
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CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
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EXECUTED as of the 9/06 Amendment Effective Date.
HOMEBANC CORP.
By: /s/ JAMES L. KRAKAU
Name: James L. Krakau
Title: Senior Vice President
HOMEBANC MORTGAGE CORPORATION
By: /s/ JAMES L. KRAKAU
Name: James L. Krakau
Title: Senior Vice President
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
JPMORGAN CHASE BANK, N.A.
as the Agent and as a Lender
By: /s/ THANH ROETTELE
Name: THANH ROETTELE
Title: VICE PRESIDENT
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
COMMERZBANK AKTIENGESELLSCHAFT
NEW YORK AND GRAND CAYMAN BRANCHES
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| as a Lender |
By: /s/ GERARD A. ARAW
Name: Gerard A. Araw
Title: Assistant Treasurer
By: /s/ MICHAEL P. McCARTHY
Name: Michael P. McCarthy
Title: Vice President
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
KEYBANK NATIONAL ASSOCIATION,
as a Lender
By: /s/ PAUL HENSON
Name: Paul Henson
Title: Executive Vice President
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
U.S. BANK NATIONAL ASSOCIATION,
as a Lender
By: /s/ WILLIAM J. UMSCHEID
Name: WILLIAM J. UMSCHEID
Title: Vice President
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
BNP PARIBAS,
as a Lender
By: /s/ LAURENT VANDERZYPPE
Name: LAURENT VANDERZYPPE
Title: Managing Director
By: /s/ MARGUERITE L. LETON
Name: MARGUERITE L. LETON
Title: Vice President
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
UNITED OVERSEAS BANK LIMITED
NEW YORK AGENCY,
as a Lender
By: /s/ GEORGE LIM
Name: George Lim
Title: FVP & General Manager
By: /s/ MARIO SHENG
Name: Mario Sheng
Title: AVP
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
FIRST COMMERCIAL BANK,
NEW YORK AGENCY,
as a Lender
By: /s/ BRUCE M..J. JU
Name: Bruce M. J. Ju
Title: SVP & General Manager
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
BANK HAPOALIM B.M.,
as a Lender
By: /s/ JAMES P. SURLESS
Name: JAMES P. SURLESS
Title: VICE PRESIDENT
By: /s/ CHARLES McLAUGHLIN
Name: CHARLES McLAUGHLIN
Title: Senior Vice President
Exhibits
| Exhibit 9/06-E | - | Form of Officer’s Certificate |
Unnumbered counterpart signature page to 9/06 Amendment to 8/05 Amended and Restated Senior Secured Credit Agreement among HomeBanc Corp., HomeBanc Mortgage Corporation, JPMorgan Chase Bank, et al.
EXHIBIT 9/06-E
TO 8/05 CREDIT AGREEMENT
Form of Officer’s Certificate with computations
to show compliance or non-compliance with
certain financial covenants
OFFICER’S CERTIFICATE
| AGENT: | JPMORGAN CHASE BANK, N.A. |
| COMPANY: | HOMEBANC CORPORATION (“HC”) |
| SUBJECT PERIOD: | ended , 200 |
| DATE: | , 200 |
This certificate is delivered to the Agent under the 8/05 Amended and Restated Senior Secured Credit Agreement dated as of August 1, 2005 (as supplemented, amended or restated from time to time, the “Current Credit Agreement”), among HC, its Subsidiary, HomeBanc Mortgage Corporation, the Agent and the financial institutions now or hereafter parties thereto (the “Lenders”). Unless they are otherwise defined in this request, terms defined in the Current Credit Agreement have the same meanings here as there.
The undersigned officer of HC certifies to the Agent and the Lenders that on the date of this certificate that:
1. The undersigned is an incumbent officer of HC, holding the title stated below the undersigned’s signature below.
2. HC’s financial statements that are attached to this certificate were prepared in accordance with GAAP (except that interim — i.e., other than annual — financial statements exclude notes to financial statements and statements of changes to stockholders’ equity and are subject to year-end adjustments) and (subject to the aforesaid proviso as to interim financial statements) present fairly the financial position and results of operations of HC and its Subsidiaries, on a consolidated basis, as of and for the (check, as applicable) o month o one, o two or o three quarter(s) of HC’s fiscal year, as the case may be, ending on the last day of that period (the “Subject Period”).
3. The undersigned officer of HC supervised a review of the activities of HC and its Subsidiaries during the Subject Period in respect of the following matters and has determined the following: (a) to undersigned officer’s best knowledge, except to the extent that (i) a
representation or warranty speaks to a specific date or (ii) the facts on which a representation or warranty is based have changed by transactions or conditions contemplated or expressly permitted by the Facilities Papers, the representations and warranties of the Companies in Section 9 of the Current Credit Agreement are true and correct in all material respects, other than for the changes, if any, described on the attached Annex A; (b) the Companies have complied with all of their obligations under the Facilities Papers, other than for the deviations, if any, described on the attached Annex A; (c) no Event of Default has occurred that has not been declared by the Agent in writing to have been cured or waived, and no Default has occurred that has not been cured before it became an Event of Default, other than those Events of Default and/or Defaults, if any, described on the attached Annex A (d) compliance by HC with certain financial covenants in Section 11 of the Current Credit Agreement is accurately calculated on the attached Annex A.
HOMEBANC CORP.
By:
Name:
Title:
ANNEX A TO OFFICER’S CERTIFICATE
1. Describe deviations from compliance with obligations, if any — clause 3(b) of attached Officer’s Certificate — if none, so state:
2. Describe Defaults or Events of Default, if any — clause 3(c) of attached Officer’s Certificate — if none, so state:
3. Calculate compliance with covenants in Section 11 — clause 3(d) of attached Officer’s Certificate:
(a) Section 11.4(a). HC’s Adjusted Tangible Net Worth as of ________ is $__________________ (the minimum under Section 11.4(a) is $225,000,000 plus 85% of the net proceeds realized by HC from equity offerings after its initial public offering.)
(b) Section 11.4(b). HC’s Total Recourse Liabilities to Adjusted Tangible Net Worth ratio as of ___________ is _____:1.00 (the limit under Section 11.4(b) is 8.0:1:00.)
(c) Section 11.4(c). HC’s Total Liabilities minus Qualified Subordinated Debt to Adjusted Tangible Net Worth ratio as of ___________ is ______:1.00 (the limit under Section 11.4(c) is as follows:)
| On and after this Date | the maximum ratio is |
| Effective Date | 20.00:1.00 |
| November 30, 2005 | 25.00:1.00 |
(d) Section 11.4(d). HC’s Liquidity is $______________. (The minimum under Section 11.4(d) is $35,000,000.)
(e) Section 11.4(e). HMC’s Adjusted Tangible Net Worth as of ________ is $__________________ (the minimum under Section 11.4(e) is $10,000,000.)
(f) Section 11.4(f). HC and its Subsidiaries have not incurred any Debt other than (i) Debt to the Lenders under the Current Credit Agreement; (ii) Debt under warehousing, repurchase or other mortgage-related asset agreements to finance the Companies’ inventory of Mortgage Loans and other mortgage-related assets; (iii) accounts payable incurred in the ordinary course of business with standard payment terms; (iv) Debt of up to Twenty Million Dollars ($20,000,000) incurred in the ordinary course of business (for purposes of this provision, junior subordinated debt to support trust common securities issued by HC or HMC concurrently and in connection with the issuance of junior subordinate debentures issued by HC or HMC shall be deemed debt incurred in the ordinary course of business); (v) Debt of one Company owed to the other Company, so long as such inter-company Debt is subordinated, in form acceptable to the Agent, to the Debt under this Facility; (vi) Debt of up to Two Hundred Million Dollars ($200,000,000) issued by HC or HMC to support the issuance of Qualified Trust Preferred Securities and related common securities by any and all Capital Trust Entities and (vii) Debt securities issued by HC convertible into common stock, of up to Two Hundred Million Dollars ($200,000,000), subordinated, in form acceptable to the Agent, to the Debt under the Current Credit Agreement.
(g) Section 11.4(g). HC has not declared or paid any dividend or made any distribution directly or indirectly to its shareholders when, or after the payment of which, (i) any Default or Event of Default described in Sections 12.1(a), 12.1(b), or non-payment of any fee described in 12.1(c) exists or (ii) when any Default or Event of Default other than those described in Sections 12.1(a), 12.1(b), or non-payment of any fee described in 12.1(c) exists, except to the extent necessary to avoid the loss of HC’s federal tax status as a real estate investment trust.
(h) Section 11.4(h). The Companies have not directly or indirectly made any advance to (or declined or deferred any payment due from) any stockholder where at the time of or immediately after such action (x) the Companies’ Adjusted Tangible Net Worth was or would be less than the minimum specified in clause (d) above or (y) any Default or Event of Default existed or would exist[, except for the aggregate sum of $_____________ advanced by HMC to HC which was necessary to enable HC to fund payment of a dividend the nonpayment of which would result in the loss of HC’s federal tax status as a real estate investment trust].
(a) Section 11.4(i). The percentage of the aggregate principal balances of all of the Companies’ Serviced Loans that are In Default as of __________________ is __________% (the maximum permitted under Section 11.4(i) is 5%.)
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| (b) |
