Unencumbered Pool Assets. (a) The Eligible Real Estate included as Unencumbered Pool Assets and in the calculation of the Unencumbered Pool Aggregate Asset Value shall at all times satisfy all of the following conditions (unless otherwise permitted pursuant to §7.20(b)): (i) the Eligible Real Estate shall be owned one hundred percent (100%) in fee simple, or leased under a Ground Lease as to which no Ground Lease Default has occurred, by the Borrower or a Subsidiary Guarantor, in each case free and clear of all Liens other than the Liens permitted in §8.2(i), (iv) and (ix), and such Eligible Real Estate shall not have applicable to it any restriction which prohibits or purports to prohibit the sale, pledge, transfer, mortgage or assignment of such Eligible Real Estate, or the creation or assumption of any Lien on such Eligible Real Estate or interest therein as security for the Obligations (including any restrictions contained in any applicable organizational documents or any other instrument or agreement (other than a Loan Document)) (any such restriction, a “Negative Pledge”); (ii) none of the Eligible Real Estate shall have any material title, survey, environmental, structural or other defects that would give rise to a materially adverse effect as to the value, use of or ability to sell or refinance such property, and all representations and warranties with respect to such Eligible Real Estate shall be true and correct in all material respects (without giving effect to any knowledge qualifier with respect to any such representation or warranty set forth in §6.19); (iii) if such Eligible Real Estate is owned or leased by an Unencumbered Property Subsidiary, (a) the only asset of such Subsidiary shall be the Eligible Real Estate included as an Unencumbered Pool Asset and any furniture, fixtures, equipment and cash related to, or used in the ordinary operation of, such Eligible Real Estate, (b) Borrower shall directly or indirectly own 100% of all Equity Interests (including all economic, beneficial and voting interests) in such Unencumbered Property Subsidiary, any and all intermediate entities shall be Subsidiary Guarantors to the extent required by this Agreement, and no direct or indirect ownership or other interests or rights of Borrower in any such Unencumbered Property Subsidiary shall be subject to any Lien (other than Liens permitted pursuant to §8.2(i)(A)) or any Negative Pledge, and (c) without limiting the ability of such Unencumbered Property Subsidiary to guaranty Unsecured Indebtedness otherwise permitted hereunder, such Unencumbered Property Subsidiary shall not be a borrower, primary obligor or guarantor with respect to any other Indebtedness; (iv) such Eligible Real Estate shall be self-managed by the Borrower or the Subsidiary Guarantor or by a Property Manager pursuant to a Management Agreement; (v) no more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to one Unencumbered Pool Asset (or twenty percent (20.0%) if the sole Tenant thereof is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value; (vi) No more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be subject to Ground Leases, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value; (vii) No more than twenty percent (20.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to the same Tenant or its Affiliates (or twenty-five percent (25.0%) if such Tenant is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value; (viii) no more than twenty-five percent (25.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to any single MSA, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value; (ix) At least forty percent (40.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants, provided that any shortfall to such requirement shall not, by itself, constitute a Default or Event of Default, but Unencumbered Asset Value attributable to Unencumbered Pool Assets not leased to Investment Grade Tenants shall instead be reduced such that, after giving effect to such reduction, forty percent (40.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants; (x) the Eligible Real Estate included as Unencumbered Pool Assets shall at all times have in the aggregate a weighted average remaining lease term (calculated by weighting the remaining lease term of each such Eligible Real Estate (without regard to any extension options at the tenant’s discretion) by the Unencumbered Asset Value attributable to such Eligible Real Estate) of not less than five (5) years; provided, however, that the foregoing requirement shall not be applicable at any time REIT has obtained and is maintaining an Investment Grade Rating from at least two (2) Rating Agencies; (xi) No more than five percent (5.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets that are “dark” (i.e., not being operated by the applicable Tenant (including any subtenant thereof) and in respect of which the applicable Tenant is paying in full the rent and other amounts due under its Lease for such Unencumbered Pool Asset and is in compliance with its other material obligations under its Lease), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value; (xii) No more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets located in Approved Foreign Countries, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value; (xiii) there shall be at all times at least sixty-five (65) Unencumbered Pool Assets included in the calculation of Unencumbered Pool Aggregate Asset Value and the Unencumbered Pool Aggregate Asset Value shall be at least Six Hundred Million Dollars ($600,000,000); (xiv) the Borrower shall have delivered to the Agent (A) a written request to include such Eligible Real Estate as an Unencumbered Pool Asset, (B) the Eligible Real Estate Qualification Documents, and such Eligible Real Estate Qualification Documents shall have been approved by the Agent (in its reasonable discretion); provided, with respect to the initial Unencumbered Pool Assets set forth on Schedule 1.2 attached hereto, that the Eligible Real Estate Qualification Documents required to be delivered pursuant to this clause (xiv) shall be deemed to be the “Eligible Real Estate Qualification Documents” delivered pursuant to the Existing Credit Agreement and Agent hereby confirms its approval of the same, (C) a certification by the chief financial officer of REIT that such Real Estate qualifies as Eligible Real Estate and as to the matters covered under §7.20(a)(i)-(xiii) in the form of Exhibit “K” hereto (an “Unencumbered Pool Asset Certificate”), and (D) such other information as the Agent may reasonably require with respect to such Eligible Real Estate, including, but not limited to, any information required by the Agent to determine the Unencumbered Asset Value attributable to such Eligible Real Estate and compliance with this §7.20; and (xv) such Eligible Real Estate shall not have been excluded from the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(c), §7.20(d) or §7.20(e). (b) Notwithstanding the foregoing, in the event any Real Estate does not qualify as an Eligible Real Estate or satisfy the requirements of §7.20(a), such Real Estate shall be included in the calculation of the Unencumbered Pool Aggregate Asset Value so long as the Agent shall have received the prior written consent of each of the Majority Lenders to the inclusion of such Real Estate in the calculation of the Unencumbered Pool Aggregate Asset Value, and no Default or Event of Default shall arise hereunder solely as a result of such Real Estate failing to satisfy the specific requirements of Eligible Real Estate or §7.20 (a) which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(a). It is agreed and understood that any Real Estate included in the calculation of the “Unencumbered Pool Aggregate Asset Value” pursuant to §7.20(b) of the Existing Credit Agreement which is included in such calculation immediately prior to the Closing Date shall continue to be included in the calculation of the Unencumbered Pool Aggregate Asset Value hereunder on the Closing Date so long as such Real Estate continues to satisfy the requirements of Eligible Real Estate and §7.20(a) hereof, except for such requirements which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value under the Existing Credit Agreement. (c) In the event that all or any material portion of any Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value shall be damaged in any material respect or taken by condemnation, then such property shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value unless and until (i) any damage to such real estate is repaired or restored, such real estate becomes fully operational and the Agent shall receive evidence satisfactory to the Agent of the value of such real estate following such repair or restoration (both at such time and prospectively) or (ii) the Agent shall receive evidence reasonably satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall not be materially adversely affected by such damage or condemnation. In the event that such damage or condemnation only partially affects such Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value, then the Agent may in good faith reduce the Unencumbered Asset Value attributable thereto based on such damage until such time as the Agent receive evidence satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall no longer be materially adversely affected by such damage or condemnation. (d) Upon any asset ceasing to qualify to be included as an Unencumbered Pool Asset, such asset shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value unless otherwise approved in writing by the Majority Lenders. Within five (5) Business Days after becoming aware of any such disqualification, the Borrower shall deliver to the Agent a certificate reflecting such disqualification, together with the identity of the disqualified asset, a statement as to whether any Default or Event of Default arises as a result of such disqualification, and a calculation of the Unencumbered Asset Value attributable to such asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent an updated Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the conditions and covenants contained in §§7.20, 9.3 and 9.4. (e) In addition, the Borrower may voluntarily remove any Real Estate from the calculation of the Unencumbered Pool Aggregate Asset Value by delivering to the Agent, no later than five (5) Business Days prior to date on which such removal is to be effected, notice of such removal, together with a statement that no Default or Event of Default then exists or would, upon the occurrence of such event or with passage of time, result from such removal, the identity of the Unencumbered Pool Asset being removed, and a calculation of the Unencumbered Asset Value attributable to such Unencumbered Pool Asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent a pro forma Compliance Certificate and Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the covenants contained in §7.20, §9.3 and §9.4.
Appears in 1 contract
Unencumbered Pool Assets. (a) The Eligible Real Estate included as Unencumbered Pool Assets and in the calculation of the Unencumbered Pool Aggregate Asset Value shall at all times satisfy all of the following conditions (unless otherwise permitted pursuant to §7.20(b)):
(i) the Eligible Real Estate shall be owned one hundred percent (100%) in fee simple, or leased under a Ground Lease as to which no Ground Lease Default has occurred, by the Borrower or a Subsidiary Guarantor, in each case free and clear of all Liens other than the Liens permitted in §8.2(i), (iv) and (ix), and such Eligible Real Estate shall not have applicable to it any restriction which prohibits or purports to prohibit the sale, pledge, transfer, mortgage or assignment of such Eligible Real Estate, or the creation or assumption of any Lien on such Eligible Real Estate or interest therein as security for the Obligations (including any restrictions contained in any applicable organizational documents or any other instrument or agreement (other than a Loan Document)) (any such restriction, a “Negative Pledge”);
(ii) none of the Eligible Real Estate shall have any material title, survey, environmental, structural or other defects that would give rise to a materially adverse effect as to the value, use of or ability to sell or refinance such property, and all representations and warranties with respect to such Eligible Real Estate shall be true and correct in all material respects (without giving effect to any knowledge qualifier with respect to any such representation or warranty set forth in §6.19);
(iii) if such Eligible Real Estate is owned or leased by an Unencumbered Property Subsidiary, (a) the only asset of such Subsidiary shall be the Eligible Real Estate included as an Unencumbered Pool Asset and any furniture, fixtures, equipment and cash related to, or used in the ordinary operation of, such Eligible Real Estate, (b) Borrower shall directly or indirectly own 100% of all Equity Interests (including all economic, beneficial and voting interests) in such Unencumbered Property Subsidiary, any and all intermediate entities shall be Subsidiary Guarantors to the extent required by this Agreement, and no direct or indirect ownership or other interests or rights of Borrower in any such Unencumbered Property Subsidiary shall be subject to any Lien (other than Liens permitted pursuant to §8.2(i)(A)) or any Negative Pledge, and (c) without limiting the ability of such Unencumbered Property Subsidiary to guaranty Unsecured Indebtedness otherwise permitted hereunder, such Unencumbered Property Subsidiary shall not be a borrower, primary obligor or guarantor with respect to any other Indebtedness;
(iv) such Eligible Real Estate shall be self-managed by the Borrower or the Subsidiary Guarantor or by a Property Manager pursuant to a Management Agreement;
(v) no more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to one Unencumbered Pool Asset (or twenty percent (20.0%) if the sole Tenant thereof is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(vi) No more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be subject to Ground Leases, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(vii) No more than twenty percent (20.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to the same Tenant or its Affiliates (or twenty-five percent (25.0%) if such Tenant is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(viii) no more than twenty-five percent (25.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to any single MSA, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(ix) At least forty thirty-five percent (40.035.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants, provided that any shortfall to such requirement shall not, by itself, constitute a Default or Event of Default, but Unencumbered Asset Value attributable to Unencumbered Pool Assets not leased to Investment Grade Tenants shall instead be reduced such that, after giving effect to such reduction, forty thirty-five percent (40.035.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants;
(x) the Eligible Real Estate occupied by a single Tenant included as Unencumbered Pool Assets shall at all times have in the aggregate a weighted average remaining lease term (calculated by weighting the remaining lease term of each such Eligible Real Estate (without regard to any extension options at the tenant’s discretion) by the Unencumbered Asset Value attributable to such Eligible Real Estate) of not less than five four and one-half (54.5) years; provided, however, that the foregoing requirement shall not be applicable at any time REIT has obtained and is maintaining an Investment Grade Rating from at least two (2) Rating Agencies;
(xi) No more than five percent (5.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets that are “dark” (i.e., not being operated by the applicable Tenant (including any subtenant thereof) and in respect of which the applicable Tenant is paying in full the rent and other amounts due under its Lease for such Unencumbered Pool Asset and is in compliance with its other material obligations under its Lease), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(xii) No more than fifteen fifty percent (15.050.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets located in Approved Foreign Countries, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(xiii) (A) the Eligible Real Estate included as Unencumbered Pool Assets shall at all times have a minimum aggregate Occupancy Rate of eighty percent (80.0%), and (B) the minimum Occupancy Rate of each Unencumbered Pool Asset occupied by multiple Tenants shall be no less than 70% for any two consecutive quarters; provided, however, that, if any Unencumbered Pool Asset occupied by multiple Tenants fails to satisfy the foregoing requirement, such Unencumbered Pool Asset shall continue to be included as an Unencumbered Pool Asset, but the Unencumbered Asset Value attributable to such Unencumbered Pool Asset for purposes of determining financial covenant compliance shall be limited to 66.67% of the Unencumbered Asset Value determined for such Unencumbered Pool Asset until such time as such Unencumbered Pool Asset satisfies the foregoing requirement for two consecutive quarters;
(xiv) there shall be at all times at least sixty-five (65) Unencumbered Pool Assets included in the calculation of Unencumbered Pool Aggregate Asset Value and the Unencumbered Pool Aggregate Asset Value shall be at least Six Hundred Million Dollars ($600,000,000);
(xivxv) the Borrower shall have delivered to the Agent (A) a written request to include such Eligible Real Estate as an Unencumbered Pool Asset, (B) the Eligible Real Estate Qualification Documents, and such Eligible Real Estate Qualification Documents shall have been approved by the Agent (in its reasonable discretion); provided, with respect to the initial Unencumbered Pool Assets set forth on Schedule 1.2 attached heretohereto as of the Second Amendment Date, that the Agent hereby confirms its approval of the Eligible Real Estate Qualification Documents required to be delivered pursuant to this clause (xiv) shall be deemed to be the “Eligible Real Estate Qualification Documents” delivered pursuant to the Existing Credit Agreement and Agent hereby confirms its approval of the samexv), (C) a certification by the chief financial officer of REIT that such Real Estate qualifies as Eligible Real Estate and as to the matters covered under §7.20(a)(i)-(xiii7.20(a)(i)-(xiv) in the form of Exhibit “K” hereto (an “Unencumbered Pool Asset Certificate”), and (D) such other information as the Agent may reasonably require with respect to such Eligible Real Estate, including, but not limited to, any information required by the Agent to determine the Unencumbered Asset Value attributable to such Eligible Real Estate and compliance with this §7.20; and
(xvxvi) such Eligible Real Estate shall not have been excluded from the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(c), §7.20(d) or §7.20(e).
(b) Notwithstanding the foregoing, in the event any Real Estate does not qualify as an Eligible Real Estate or satisfy the requirements of §7.20(a), such Real Estate shall be included in the calculation of the Unencumbered Pool Aggregate Asset Value so long as the Agent shall have received the prior written consent of each of the Majority Lenders to the inclusion of such Real Estate in the calculation of the Unencumbered Pool Aggregate Asset Value, and no Default or Event of Default shall arise hereunder solely as a result of such Real Estate failing to satisfy the specific requirements of Eligible Real Estate or §7.20
(a) which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(a). It is agreed and understood that any Real Estate included in the calculation of the “Unencumbered Pool Aggregate Asset Value” pursuant to §7.20(b) of the Existing Credit Agreement which is included in such calculation immediately prior to the Closing Second Amendment Date shall continue to be included in the calculation of the Unencumbered Pool Aggregate Asset Value hereunder on the Closing Second Amendment Date so long as such Real Estate continues to satisfy the requirements of Eligible Real Estate and §7.20(a) hereof, except for such requirements which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value under the Existing Credit AgreementAgreement prior to the Second Amendment Date.
(c) In the event that all or any material portion of any Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value shall be damaged in any material respect or taken by condemnation, then such property shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value unless and until (i) any damage to such real estate is repaired or restored, such real estate becomes fully operational and the Agent shall receive evidence satisfactory to the Agent of the value of such real estate following such repair or restoration (both at such time and prospectively) or (ii) the Agent shall receive evidence reasonably satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall not be materially adversely affected by such damage or condemnation. In the event that such damage or condemnation only partially affects such Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value, then the Agent may in good faith reduce the Unencumbered Asset Value attributable thereto based on such damage until such time as the Agent receive evidence satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall no longer be materially adversely affected by such damage or condemnation.
(d) Upon any asset ceasing to qualify to be included as an Unencumbered Pool Asset, such asset shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value unless otherwise approved in writing by the Majority Lenders. Within five (5) Business Days after becoming aware of any such disqualification, the Borrower shall deliver to the Agent a certificate reflecting such disqualification, together with the identity of the disqualified asset, a statement as to whether any Default or Event of Default arises as a result of such disqualification, and a calculation of the Unencumbered Asset Value attributable to such asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent an updated Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the conditions and covenants contained in §§7.20, 9.3 and 9.4.
(e) In addition, the Borrower may voluntarily remove any Real Estate from the calculation of the Unencumbered Pool Aggregate Asset Value by delivering to the Agent, no later than five (5) Business Days prior to date on which such removal is to be effected, notice of such removal, together with a statement that no Default or Event of Default then exists or would, upon the occurrence of such event or with passage of time, result from such removal, the identity of the Unencumbered Pool Asset being removed, and a calculation of the Unencumbered Asset Value attributable to such Unencumbered Pool Asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent a pro forma Compliance Certificate and Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the covenants contained in §7.20, §9.3 and §9.4.
Appears in 1 contract
Unencumbered Pool Assets. (a) The Eligible Real Estate included as Unencumbered Pool Assets and in the calculation of the Unencumbered Pool Aggregate Asset Value shall at all times satisfy all of the following conditions (unless otherwise permitted pursuant to §7.20(b)):
(i) the Eligible Real Estate shall be owned one hundred percent (100%) in fee simple, or leased under a Ground Lease as to which no Ground Lease Default has occurred, by the Borrower or a Subsidiary Guarantor, in each case free and clear of all Liens other than the Liens permitted in §8.2(i), (iv) and (ix), and such Eligible Real Estate shall not have applicable to it any restriction which prohibits or purports to prohibit the sale, pledge, transfer, mortgage or assignment of such Eligible Real Estate, or the creation or assumption of any Lien on such Eligible Real Estate or interest therein as security for the Obligations (including any restrictions contained in any applicable organizational documents or any other instrument or agreement (other than a Loan Document)) (any such restriction, a “Negative Pledge”);
(ii) none of the Eligible Real Estate shall have any material title, survey, environmental, structural or other defects that would give rise to a materially adverse effect as to the value, use of or ability to sell or refinance such property, and all representations and warranties with respect to such Eligible Real Estate shall be true and correct in all material respects (without giving effect to any knowledge qualifier with respect to any such representation or warranty set forth in §6.19);
(iii) if such Eligible Real Estate is owned or leased by an Unencumbered Property Subsidiary, (a) the only asset of such Subsidiary shall be the Eligible Real Estate included as an Unencumbered Pool Asset and any furniture, fixtures, equipment and cash related to, or used in the ordinary operation of, such Eligible Real Estate, (b) Borrower shall directly or indirectly own 100% of all Equity Interests (including all economic, beneficial and voting interests) in such Unencumbered Property Subsidiary, any and all intermediate entities shall be Subsidiary Guarantors to the extent required by this Agreement, and no direct or indirect ownership or other interests or rights of Borrower in any such Unencumbered Property Subsidiary shall be subject to any Lien (other than Liens permitted pursuant to §8.2(i)(A)) or any Negative Pledge, and (c) without limiting the ability of such Unencumbered Property Subsidiary to guaranty Unsecured Indebtedness otherwise permitted hereunder, such Unencumbered Property Subsidiary shall not be a borrower, primary obligor or guarantor with respect to any other Indebtedness;
(iv) such Eligible Real Estate shall be self-managed by the Borrower or the Subsidiary Guarantor or by a Property Manager pursuant to a Management Agreement;
(v) no more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to one Unencumbered Pool Asset (or twenty percent (20.0%) if the sole Tenant thereof is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(vi) No more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be subject to Ground Leases, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(vii) No more than twenty percent (20.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to the same Tenant or its Affiliates (or twenty-five percent (25.0%) if such Tenant is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(viii) no more than twenty-five percent (25.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to any single MSA, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(ix) At least forty percent (40.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants, provided that any shortfall to such requirement shall not, by itself, constitute a Default or Event of Default, but Unencumbered Asset Value attributable to Unencumbered Pool Assets not leased to Investment Grade Tenants shall instead be reduced such that, after giving effect to such reduction, forty percent (40.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants;
(x) the Eligible Real Estate included as Unencumbered Pool Assets shall at all times have in the aggregate a weighted average remaining lease term (calculated by weighting the remaining lease term of each such Eligible Real Estate (without regard to any extension options at the tenant’s discretion) by the Unencumbered Asset Value attributable to such Eligible Real Estate) of not less than five (5) years; provided, however, that the foregoing requirement shall not be applicable at any time REIT has obtained and is maintaining an Investment Grade Rating from at least two (2) Rating Agencies;
(xi) No more than five percent (5.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets that are “dark” (i.e., not being operated by the applicable Tenant (including any subtenant thereof) and in respect of which the applicable Tenant is paying in full the rent and other amounts due under its Lease for such Unencumbered Pool Asset and is in compliance with its other material obligations under its Lease), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(xii) No more than fifteen twenty percent (15.020.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets located in Approved Foreign Countries, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(xiii) No more than five percent (5.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets occupied by multiple Tenants, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(xiv) there shall be at all times at least sixty-five (65) Unencumbered Pool Assets included in the calculation of Unencumbered Pool Aggregate Asset Value and the Unencumbered Pool Aggregate Asset Value shall be at least Six Hundred Million Dollars ($600,000,000);
(xivxv) the Borrower shall have delivered to the Agent (A) a written request to include such Eligible Real Estate as an Unencumbered Pool Asset, (B) the Eligible Real Estate Qualification Documents, and such Eligible Real Estate Qualification Documents shall have been approved by the Agent (in its reasonable discretion); provided, with respect to the initial Unencumbered Pool Assets set forth on Schedule 1.2 attached hereto, that the Eligible Real Estate Qualification Documents required to be delivered pursuant to this clause (xivxv) shall be deemed to be the “Eligible Real Estate Qualification Documents” delivered pursuant to the Existing Credit Agreement and Agent hereby confirms its approval of the same, (C) a certification by the chief financial officer of REIT that such Real Estate qualifies as Eligible Real Estate and as to the matters covered under §7.20(a)(i)-(xiii7.20(a)(i)-(xiv) in the form of Exhibit “K” hereto (an “Unencumbered Pool Asset Certificate”), and (D) such other information as the Agent may reasonably require with respect to such Eligible Real Estate, including, but not limited to, any information required by the Agent to determine the Unencumbered Asset Value attributable to such Eligible Real Estate and compliance with this §7.20; and
(xvxvi) such Eligible Real Estate shall not have been excluded from the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(c), §7.20(d) or §7.20(e).
(b) Notwithstanding the foregoing, in the event any Real Estate does not qualify as an Eligible Real Estate or satisfy the requirements of §7.20(a), such Real Estate shall be included in the calculation of the Unencumbered Pool Aggregate Asset Value so long as the Agent shall have received the prior written consent of each of the Majority Lenders to the inclusion of such Real Estate in the calculation of the Unencumbered Pool Aggregate Asset Value, and no Default or Event of Default shall arise hereunder solely as a result of such Real Estate failing to satisfy the specific requirements of Eligible Real Estate or §7.20
(a) which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(a). It is agreed and understood that any Real Estate included in the calculation of the “Unencumbered Pool Aggregate Asset Value” pursuant to §7.20(b) of the Existing Credit Agreement which is included in such calculation immediately prior to the Closing Date shall continue to be included in the calculation of the Unencumbered Pool Aggregate Asset Value hereunder on the Closing Date so long as such Real Estate continues to satisfy the requirements of Eligible Real Estate and §7.20(a) hereof, except for such requirements which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value under the Existing Credit Agreement.
(c) In the event that all or any material portion of any Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value shall be damaged in any material respect or taken by condemnation, then such property shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value unless and until (i) any damage to such real estate is repaired or restored, such real estate becomes fully operational and the Agent shall receive evidence satisfactory to the Agent of the value of such real estate following such repair or restoration (both at such time and prospectively) or (ii) the Agent shall receive evidence reasonably satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall not be materially adversely affected by such damage or condemnation. In the event that such damage or condemnation only partially affects such Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value, then the Agent may in good faith reduce the Unencumbered Asset Value attributable thereto based on such damage until such time as the Agent receive evidence satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall no longer be materially adversely affected by such damage or condemnation.
(d) Upon any asset ceasing to qualify to be included as an Unencumbered Pool Asset, such asset shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value unless otherwise approved in writing by the Majority Lenders. Within five (5) Business Days after becoming aware of any such disqualification, the Borrower shall deliver to the Agent a certificate reflecting such disqualification, together with the identity of the disqualified asset, a statement as to whether any Default or Event of Default arises as a result of such disqualification, and a calculation of the Unencumbered Asset Value attributable to such asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent an updated Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the conditions and covenants contained in §§7.20, 9.3 and 9.4.
(e) In addition, the Borrower may voluntarily remove any Real Estate from the calculation of the Unencumbered Pool Aggregate Asset Value by delivering to the Agent, no later than five (5) Business Days prior to date on which such removal is to be effected, notice of such removal, together with a statement that no Default or Event of Default then exists or would, upon the occurrence of such event or with passage of time, result from such removal, the identity of the Unencumbered Pool Asset being removed, and a calculation of the Unencumbered Asset Value attributable to such Unencumbered Pool Asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent a pro forma Compliance Certificate and Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the covenants contained in §7.20, §9.3 and §9.4.
Appears in 1 contract
Unencumbered Pool Assets. (a) The Eligible Real Estate included as Unencumbered Pool Assets and included in the calculation of the Unencumbered Pool Aggregate Asset Value Availability and inclusion as Unencumbered Pool Assets shall at all times satisfy all of the following conditions (unless otherwise permitted pursuant to §7.20(b)):
(i) the Eligible Real Estate Unencumbered Pool Assets shall be owned one hundred percent (100%) in fee simple, or leased under a Ground Lease as to which no Ground Lease Default has occurred, by the Borrower or a Subsidiary Guarantor, in each case free and clear of all Liens other than the Liens permitted in §8.2(i), (iv), (ix) and (ixx), and such Eligible Real Estate Unencumbered Pool Asset shall not have applicable to it any restriction which prohibits or purports to prohibit on the sale, pledge, transfer, mortgage or assignment of such Eligible Real Estate, or the creation or assumption of any Lien on such Eligible Real Estate or interest therein as security for the Obligations property (including any restrictions contained in any applicable organizational documents or any other instrument or agreement (other than a Loan Document)) (any such restriction, a “Negative Pledge”documents);
(ii) none of the Eligible Real Estate Unencumbered Pool Assets shall have any material title, survey, environmental, structural or other defects that would give rise to a materially adverse effect as to the value, use of or ability to sell or refinance such property, and all representations and warranties with respect to such Eligible Real Estate Unencumbered Pool Asset shall be true and correct in all material respects (without giving effect to any knowledge qualifier with respect to any such representation or warranty set forth in §6.19)warranty;
(iii) if such Eligible Real Estate Unencumbered Pool Asset is owned or leased held by an Unencumbered Property Subsidiarya Subsidiary Guarantor, (a) the only asset of such Subsidiary Guarantor shall be the Eligible Real Estate Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Availability and inclusion as an Unencumbered Pool Asset and any furniture, fixtures, equipment and cash related to, or used in the ordinary operation of, such Eligible Real Estate, (b) Borrower shall directly or indirectly own 100% of all Equity Interests (including all economic, beneficial and voting interests) in such Unencumbered Property Subsidiary, any and all intermediate entities shall be Subsidiary Guarantors to the extent required by this Agreement, and no direct or indirect ownership or other interests or rights of Borrower in any such Unencumbered Property Subsidiary shall be subject to any Lien (other than Liens permitted pursuant to §8.2(i)(A)) or any Negative Pledge, and (c) without limiting the ability of such Unencumbered Property Subsidiary to guaranty Unsecured Indebtedness otherwise permitted hereunder, such Unencumbered Property Subsidiary shall not be a borrower, primary obligor or guarantor with respect to any other IndebtednessAsset;
(iv) such Eligible Real Estate shall be Unencumbered Pool Asset is self-managed by the Borrower or Borrower, the Subsidiary Guarantor or is managed by a the Property Manager pursuant to a Management Agreement;
(v) no each tenant under a Lease at such Eligible Unencumbered Pool Asset must not be past due with respect to any payment obligation more than fifteen ninety (90) days and in material compliance with all other obligations under its lease, and not subject to any Insolvency Event; provided, however, that if such Eligible Unencumbered Pool Asset is a multi-tenant facility and a tenant thereof is subject to an Insolvency Proceeding, such Eligible Unencumbered Pool Asset may be included in the calculation of the Unencumbered Pool Availability if such tenant does not lease more than forty percent (15.040%) of the Net Rentable Area of such Eligible Unencumbered Pool Asset;
(vi) no Eligible Unencumbered Pool Assets which are subject to a lease or leases to any single tenant or any Affiliate thereof shall account for more than twenty-five percent (25%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to one Unencumbered Pool Asset (or twenty percent (20.0%) if the sole Tenant thereof is an Investment Grade Tenant), provided that and any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value) (for the purposes hereof, tenants shall not be considered Affiliates of each other solely by virtue of having common ownership by an equity fund provided that their financial results are not consolidated with a common parent entity);
(vivii) No more than fifteen the aggregate Unencumbered Pool Asset Value of the Eligible Unencumbered Pool Assets constituting LTACs, Rehabs, ASCs, hospitals or other healthcare facilities shall not exceed thirty-five percent (15.035%) of the Unencumbered Pool Aggregate Asset Value shall be subject to Ground Leases, provided that (and any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value);
(viiviii) No more than twenty percent the Primary License of such Eligible Unencumbered Pool Asset shall not have been revoked or the subject of any revocation proceeding or, with respect to an SNF, the Operator thereof is no longer entitled to reimbursement under Medicare or Medicaid;
(20.0%ix) the Eligible Unencumbered Pool Assets included in the calculation of the Unencumbered Pool Aggregate Asset Value shall be attributable to the same Tenant or its Affiliates consist of not less than fifteen (or twenty-five percent (25.0%15) if such Tenant is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute Assets having a Default or Event Capitalized Value of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Valuenot less than Two Hundred Million Dollars ($200,000,000);
(viiix) no more than twenty-five percent (25.025%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to any single MSA, provided that MSA (and any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value);
(ixxi) At least forty not less than thirty-five percent (40.035%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants, provided that any shortfall to such requirement shall not, by itself, constitute a Default or Event of Default, but Unencumbered Asset Value attributable to Eligible Unencumbered Pool Assets not leased to Investment Grade Tenants shall instead be reduced such that, after giving effect to such reduction, forty percent (40.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants;
(x) the Eligible Real Estate included as Unencumbered Pool Assets shall at all times have in the aggregate a weighted average remaining lease term (calculated by weighting the remaining lease term of each such Eligible Real Estate (without regard to any extension options at the tenant’s discretion) by the Unencumbered Asset Value attributable to such Eligible Real Estate) of not less than five (5) years; provided, however, that the foregoing requirement shall not be applicable at any time REIT has obtained and is maintaining an Investment Grade Rating from at least two (2) Rating Agencies;
(xi) No more than five percent (5.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets that are “dark” (i.e., not being operated by the applicable Tenant (including any subtenant thereof) and in respect of which the applicable Tenant is paying in full the rent and other amounts due under its Lease for such Unencumbered Pool Asset and is in compliance with its other material obligations under its Lease), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Valueconstituting MOBs;
(xii) No more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets located in Approved Foreign Countries, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(xiii) there shall be at all times at least sixty-five (65) Unencumbered Pool Assets included in the calculation of Unencumbered Pool Aggregate Asset Value and the Unencumbered Pool Aggregate Asset Value shall be at least Six Hundred Million Dollars ($600,000,000);
(xiv) the Borrower shall have delivered to the Agent (A) a written request to include such Eligible Real Estate as an Unencumbered Pool AssetAsset in the calculation of the Unencumbered Pool Availability, (B) the Eligible Real Estate Unencumbered Pool Asset Qualification Documents, and such Eligible Real Estate Unencumbered Pool Asset Qualification Documents shall have been approved by the Agent (in its reasonable discretion); provided, with respect to the initial Unencumbered Pool Assets set forth on Schedule 1.2 attached hereto, that the Eligible Real Estate Qualification Documents required to be delivered pursuant to this clause (xiv) shall be deemed to be the “Eligible Real Estate Qualification Documents” delivered pursuant to the Existing Credit Agreement and Agent hereby confirms its approval of the sameAgent, (C) a certification by the chief financial officer of REIT that such Real Estate qualifies as Eligible Real Estate and as to the matters covered under §7.20(a)(i)-(xiii) in the form of Exhibit “K” hereto (an “Unencumbered Pool Asset Certificate”7.20(a)(i)-(xi), and (D) such other information as the Agent may reasonably require with respect to such Eligible Real EstateUnencumbered Pool Asset, including, but not limited to, any information required by the Agent to determine the Unencumbered Pool Asset Value attributable to such Eligible Real Estate Unencumbered Pool Asset and compliance with this §7.20; and;
(xvxiii) the Eligible Unencumbered Pool Assets shall have had a minimum average occupancy of at least eighty percent (80%) for the three (3) month period prior to the time of inclusion of such Eligible Unencumbered Pool Assets as Unencumbered Pool Assets;
(xiv) such Eligible Real Estate shall Unencumbered Pool Asset has not have been excluded removed from the calculation of the Unencumbered Pool Aggregate Asset Value Availability pursuant to §7.20(c), §7.20(d) or §7.20(e);
(xv) with respect to any Unencumbered Pool Asset that is leased to or operated by a Non-Investment Grade Operator, such Unencumbered Pool Asset shall have a ratio of (a) EBITDAR for such tenant or operator to (b) all base rent and additional rent due and payable by a tenant under any Lease, in each case, during the previous twelve (12) calendar months, of not less than (x) 1.40 to 1.00 for any such Unencumbered Pool Asset that is a Rehab, SNF, LTAC, ASC, hospital or other healthcare facility, and (y) 1.25 to 1.00 for any such Unencumbered Pool Asset that is an ILF or ALF (provided that for the purposes of this §7.20(a)(xv), a Non-Investment Grade Operator shall not include a taxable REIT Subsidiary of REIT that leases such Unencumbered Pool Asset from Borrower or a Subsidiary Guarantor), it being understood that compliance with the foregoing covenant shall be determined on the basis of financial information provided by such Non-Investment Grade Operator regarding which no Borrower or Guarantor makes any representation or warranty; and provided that Borrower may exclude from compliance with the foregoing covenant Unencumbered Pool Assets subject to this §7.20(a)(xv) whose Unencumbered Pool Asset Value does not in the aggregate exceed ten percent (10%) of total Unencumbered Pool Asset Value to the extent that the applicable Operators’ Agreement existing at the time of acquisition of such Unencumbered Pool Asset by Borrower or its Subsidiaries does not require the delivery of financial information sufficient to permit calculation of the foregoing covenant, or with respect to any Operators’ Agreement the Operator fails to deliver financial information to permit calculation of the foregoing covenant; and
(xvi) the Eligible Unencumbered Pool Assets leased to a single tenant or operator shall at all times have on a collective basis a weighted average remaining lease term (calculated by weighting the remaining lease term of each such Eligible Unencumbered Pool Asset (without regard to any extension options at the tenant’s discretion) by the Unencumbered Pool Asset Value attributable to such Eligible Unencumbered Pool Asset) of not less than six (6) years.
(b) Notwithstanding the foregoing, in the event any Real Estate does not qualify as an Eligible Real Estate Unencumbered Pool Asset or satisfy the requirements of §7.20(a), such Real Estate shall be included in the calculation of the Unencumbered Pool Aggregate Asset Value Availability so long as the Agent shall have received the prior written consent of each of the Majority Required Lenders to the inclusion of such Real Estate in the calculation of the Unencumbered Pool Aggregate Asset Value, and no Default or Event of Default shall arise hereunder solely as a result of such Real Estate failing to satisfy the specific requirements of Eligible Real Estate or §7.20
(a) which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(a). It is agreed and understood that any Real Estate included in the calculation of the “Unencumbered Pool Aggregate Asset Value” pursuant to §7.20(b) of the Existing Credit Agreement which is included in such calculation immediately prior to the Closing Date shall continue to be included in the calculation of the Unencumbered Pool Aggregate Asset Value hereunder on the Closing Date so long as such Real Estate continues to satisfy the requirements of Eligible Real Estate and §7.20(a) hereof, except for such requirements which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value under the Existing Credit AgreementAvailability.
(c) In the event that all or any material portion of any Eligible Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value Availability shall be damaged in any material respect or taken by condemnation, then such property shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value Availability unless and until (i) any damage to such real estate is repaired or restored, such real estate becomes fully operational and the Agent shall receive evidence satisfactory to the Agent of the value of such real estate following such repair or restoration (both at such time and prospectively) or (ii) the Agent shall receive evidence reasonably satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall not be materially adversely affected by such damage or condemnation. In the event that such damage or condemnation only partially affects such Eligible Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset ValueAvailability, then the Agent Required Lenders may in good faith reduce the Unencumbered Asset Value Pool Availability attributable thereto based on such damage until such time as the Agent Required Lenders receive evidence satisfactory to the Agent Required Lenders that the value of such real estate (both at such time and prospectively) shall no longer be materially adversely affected by such damage or condemnation.
(d) Upon any asset ceasing to qualify to be included as an in the calculation of the Unencumbered Pool AssetAvailability, such asset shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value Availability unless otherwise approved in writing by the Majority Required Lenders. Within five (5) Business Days after becoming aware of any such disqualification, the Borrower shall deliver to the Agent a certificate reflecting such disqualification, together with the identity of the disqualified asset, a statement as to whether any Default or Event of Default arises as a result of such disqualification, and a calculation of the Unencumbered Asset Value Pool Availability attributable to such asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent an updated Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the conditions and covenants contained in §§7.20, 9.3 and 9.49.1.
(e) In addition, the Borrower may voluntarily remove any Real Estate from the calculation of the Unencumbered Pool Aggregate Asset Value Availability by delivering to the Agent, no later than five (5) Business Days prior to date on which such removal is to be effected, notice of such removal, together with a statement that no Default or Event of Default then exists or would, upon the occurrence of such event or with passage of time, result from such removal, the identity of the Unencumbered Pool Asset being removed, and a calculation of the Unencumbered Asset Value value attributable to such Unencumbered Pool Asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent a pro forma Compliance Certificate and Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the covenants contained in §7.20, §9.3 7.20 and §9.49.1.
Appears in 1 contract
Samples: Senior Unsecured Credit Agreement (American Realty Capital Healthcare Trust Inc)
Unencumbered Pool Assets. (a) The Eligible Real Estate included as Unencumbered Pool Assets and in the calculation of the Unencumbered Pool Aggregate Asset Value shall at all times satisfy all of the following conditions (unless otherwise permitted pursuant to §7.20(b)):
(i) the Eligible Real Estate shall be owned one hundred percent (100%) in fee simple, or leased under a Ground Lease as to which no Ground Lease Default has occurred, by the Borrower or a Subsidiary Guarantor, in each case free and clear of all Liens other than the Liens permitted in §8.2(i), (iv) and (ix), and such Eligible Real Estate shall not have applicable to it any restriction which prohibits or purports to prohibit the sale, pledge, transfer, mortgage or assignment of such Eligible Real Estate, or the creation or assumption of any Lien on such Eligible Real Estate or interest therein as security for the Obligations (including any restrictions contained in any applicable organizational documents or any other instrument or agreement (other than a Loan Document)) (any such restriction, a “Negative Pledge”);
(ii) none of the Eligible Real Estate shall have any material title, survey, environmental, structural or other defects that would give rise to a materially adverse effect as to the value, use of or ability to sell or refinance such property, and all representations and warranties with respect to such Eligible Real Estate shall be true and correct in all material respects (without giving effect to any knowledge qualifier with respect to any such representation or warranty set forth in §6.19);
(iii) if such Eligible Real Estate is owned or leased by an Unencumbered Property Subsidiary, (a) the only asset of such Subsidiary shall be the Eligible Real Estate included as an Unencumbered Pool Asset and any furniture, fixtures, equipment and cash related to, or used in the ordinary operation of, such Eligible Real Estate, (b) Borrower shall directly or indirectly own 100% of all Equity Interests (including all economic, beneficial and voting interests) in such Unencumbered Property Subsidiary, any and all intermediate entities shall be Subsidiary Guarantors to the extent required by this Agreement, and no direct or indirect ownership or other interests or rights of Borrower in any such Unencumbered Property Subsidiary shall be subject to any Lien (other than Liens permitted pursuant to §8.2(i)(A)) or any Negative Pledge, and (c) without limiting the ability of such Unencumbered Property Subsidiary to guaranty Unsecured Indebtedness otherwise permitted hereunder, such Unencumbered Property Subsidiary shall not be a borrower, primary obligor or guarantor with respect to any other Indebtedness;
(iv) such Eligible Real Estate shall be self-managed by the Borrower or the Subsidiary Guarantor or by a Property Manager pursuant to a Management Agreement;
(v) no more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to one Unencumbered Pool Asset (or twenty percent (20.0%) if the sole Tenant thereof is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(vi) No more than fifteen percent (15.0%) of the Unencumbered Pool Aggregate Asset Value shall be subject to Ground Leases, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(vii) No more than twenty fifteen percent (20.015%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to the same Tenant or its Affiliates (or twenty-five percent (25.0%) if such Tenant is an Investment Grade Tenant), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(viii) no more than twenty-five percent (25.025%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to any single MSA, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(ix) At least forty percent (40.040%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Investment Grade Tenants, provided that any shortfall excess Unencumbered Asset Value attributable to Unencumbered Pool Asset(s) not leased to Investment Grade Tenants in violation of such requirement limit shall not, by itself, constitute a Default or Event of Default, but the excess Unencumbered Asset Value attributable to such Unencumbered Pool Assets not leased to Investment Grade Tenants shall instead be reduced such that, after giving effect to such reduction, forty percent (40.0%) excluded from the calculation of the Unencumbered Pool Aggregate Asset Value shall be attributable in order to Investment Grade Tenantscomply with such limit;
(x) the Eligible Real Estate included as Unencumbered Pool Assets shall at all times have in the aggregate a weighted average remaining lease term (calculated by weighting the remaining lease term of each such Eligible Real Estate (without regard to any extension options at the tenant’s discretion) by the Unencumbered Asset Value attributable to such Eligible Real EstateEstate)(the “Weighted Average Remaining Lease Term”) of not less than five (5) years; provided, however, that the foregoing requirement shall not be applicable at any time REIT has obtained and is maintaining an Investment Grade Rating from at least two (2) Rating Agencies;
(xi) No more than five percent (5.0%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets that are “dark” (i.e., not being operated by the applicable Tenant (including any subtenant thereof) and in respect of which the applicable Tenant is paying in full the rent and other amounts due under its Lease for such Unencumbered Pool Asset and is in compliance with its other material obligations under its Lease), provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(xii) No more than fifteen ten percent (15.010%) of the Unencumbered Pool Aggregate Asset Value shall be attributable to Unencumbered Pool Assets located in Approved Foreign Countries, provided that any excess Unencumbered Asset Value attributable to such Unencumbered Pool Asset(s) above such limit shall not, by itself, constitute a Default or Event of Default, but such excess shall be excluded from the calculation of Unencumbered Pool Aggregate Asset Value;
(xiii) there shall be at all times at least sixty-five (65) Unencumbered Pool Assets included in the calculation of Unencumbered Pool Aggregate Asset Value and the Unencumbered Pool Aggregate Asset Value shall be at least Six Hundred Million Dollars ($600,000,000);
(xiv) the Borrower shall have delivered to the Agent (A) a written request to include such Eligible Real Estate as an Unencumbered Pool Asset, (B) the Eligible Real Estate Qualification Documents, and such Eligible Real Estate Qualification Documents shall have been approved by the Agent (in its reasonable discretion); provided, with respect to the initial Unencumbered Pool Assets set forth on Schedule 1.2 attached hereto, that the Eligible Real Estate Qualification Documents required to be delivered pursuant to this clause (xiv) shall be deemed to be the “Eligible Real Estate Qualification Documents” delivered pursuant to the Existing Credit Agreement and Agent hereby confirms its approval of the same, (C) a certification by the chief financial officer of REIT that such Real Estate qualifies as Eligible Real Estate and as to the matters covered under §7.20(a)(i)-(xiii) in the form of Exhibit “K” hereto (an “Unencumbered Pool Asset Certificate”), and (D) such other information as the Agent may reasonably require with respect to such Eligible Real Estate, including, but not limited to, any information required by the Agent to determine the Unencumbered Asset Value attributable to such Eligible Real Estate and compliance with this §7.20; and
(xv) such Eligible Real Estate shall not have been excluded from the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(c), §7.20(d) or §7.20(e).
(b) Notwithstanding the foregoing, in the event any Real Estate does not qualify as an Eligible Real Estate or satisfy the requirements of §7.20(a), such Real Estate shall be included in the calculation of the Unencumbered Pool Aggregate Asset Value so long as the Agent shall have received the prior written consent of each of the Majority Lenders to the inclusion of such Real Estate in the calculation of the Unencumbered Pool Aggregate Asset Value, and no Default or Event of Default shall arise hereunder solely as a result of such Real Estate failing to satisfy the specific requirements of Eligible Real Estate or §7.20
(a) which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value pursuant to §7.20(a). It is agreed and understood that any Real Estate included in the calculation of the “Unencumbered Pool Aggregate Asset Value” pursuant to §7.20(b) of the Existing Credit Agreement which is included in such calculation immediately prior to the Closing Date shall continue to be included in the calculation of the Unencumbered Pool Aggregate Asset Value hereunder on the Closing Date so long as such Real Estate continues to satisfy the requirements of Eligible Real Estate and §7.20(a) hereof, except for such requirements which initially disqualified such Real Estate from being included in the calculation of the Unencumbered Pool Aggregate Asset Value under the Existing Credit Agreement.
(c) In the event that all or any material portion of any Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value shall be damaged in any material respect or taken by condemnation, then such property shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value unless and until (i) any damage to such real estate is repaired or restored, such real estate becomes fully operational and the Agent shall receive evidence satisfactory to the Agent of the value of such real estate following such repair or restoration (both at such time and prospectively) or (ii) the Agent shall receive evidence reasonably satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall not be materially adversely affected by such damage or condemnation. In the event that such damage or condemnation only partially affects such Unencumbered Pool Asset included in the calculation of the Unencumbered Pool Aggregate Asset Value, then the Agent may in good faith reduce the Unencumbered Asset Value attributable thereto based on such damage until such time as the Agent receive evidence satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall no longer be materially adversely affected by such damage or condemnation.
(d) Upon any asset ceasing to qualify to be included as an Unencumbered Pool Asset, such asset shall no longer be included in the calculation of the Unencumbered Pool Aggregate Asset Value unless otherwise approved in writing by the Majority Lenders. Within five (5) Business Days after becoming aware of any such disqualification, the Borrower shall deliver to the Agent a certificate reflecting such disqualification, together with the identity of the disqualified asset, a statement as to whether any Default or Event of Default arises as a result of such disqualification, and a calculation of the Unencumbered Asset Value attributable to such asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent an updated Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the conditions and covenants contained in §§7.20, 9.3 and 9.49.
(e) In addition, the Borrower may voluntarily remove any Real Estate from the calculation of the Unencumbered Pool Aggregate Asset Value by delivering to the Agent, no later than five (5) Business Days prior to date on which such removal is to be effected, notice of such removal, together with a statement that no Default or Event of Default then exists or would, upon the occurrence of such event or with passage of time, result from such removal, the identity of the Unencumbered Pool Asset being removed, and a calculation of the Unencumbered Asset Value attributable to such Unencumbered Pool Asset. Simultaneously with the delivery of the items required pursuant above, the Borrower shall deliver to the Agent a pro forma Compliance Certificate and Unencumbered Pool Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the covenants contained in §7.20, §9.3 and §9.4.
Appears in 1 contract
