LOAN AGREEMENT
THIS LOAN AGREEMENT is dated as of August 22, 2000, by and between
PRIME GROUP VI, L.P., an Illinois limited partnership ("Borrower"), and LASALLE
BANK NATIONAL ASSOCIATION, a national banking association ("Lender").
R E C I T A L S:
A. Borrower desires to obtain a revolving line of credit from Lender in
the maximum principal amount of $2,300,000 (the "Loan") for working capital
purposes for Borrower. The Loan is to be secured by a lien on certain securities
owned by Borrower and is to be guaranteed by a limited partner of Borrower.
B. Lender is willing to furnish such revolving line of credit subject
to the terms and conditions set forth herein.
NOW, THEREFORE, it is agreed as follows:
ARTICLE 1
DEFINITIONS AND DETERMINATIONS
1.1 DEFINITIONS. As used in this Loan Agreement and in the other Loan
Documents, unless otherwise expressly indicated herein or therein, the following
terms shall have the following meanings (such meanings to be applicable equally
both to the singular and plural terms defined):
ACCOUNTANTS: Ernst & Young LLP or such other independent
certified public accounting firm selected by Borrower and reasonably
satisfactory to Lender.
AVAILABLE BORROWING BASE: the lesser of (i) $2,300,000 and
(ii) 50% of the Fair Market Value of the Collateral.
BORROWER'S OBLIGATIONS: (i) any and all Indebtedness due or to
become due, now existing or howsoever arising of Borrower to Lender
pursuant to the terms of this Loan Agreement or pursuant to any other
Loan Document, and (ii) the performance of the covenants of Borrower
contained in the Loan Documents.
BORROWER'S SECURITIES: See Section 5.6.
BREAK COSTS: See Section 2.10.
BUSINESS: the business of directly or indirectly acquiring,
developing, operating, managing and financing real estate or interests
therein, or investing in, or holding securities of, entities engaged in
such business.
BUSINESS DAY: any day other than a Saturday, Sunday or other
day on which banks in Chicago, Illinois, or London, England, are
closed.
CLOSING: as defined in Article 9.
CLOSING DATE: as defined in Article 9.
CODE: the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, and the rules and regulations issued
thereunder, as in effect from time to time.
COLLATERAL: the securities, cash and other property in which
Lender is granted the Security Interests pursuant to the Pledge
Agreement.
COMMITMENT: $2,300,000.
DEFAULT: any event or condition which, with the giving of
notice or the lapse of time, or both, would become an Event of Default.
DEFAULT RATE: 3% plus the Floating Rate applicable from time
to time to the outstanding principal balance of the Loan.
DEFAULT PERIOD: a period of time commencing on the date that
an Event of Default has occurred and ending on the date that such Event
of Default is cured or waived.
EVENT OF DEFAULT: any of the Events of Default set forth in
Section 8.1.
EXCHANGE ACT: the Securities Exchange Act of 1934, as amended.
FAIR MARKET VALUE OF THE COLLATERAL: as of any date the same
is to be calculated, the sum of, (i) the product of the Market Price of
PGRT Shares for such date multiplied by the number of PGRT Shares for
which the Prime Group Realty Partnership Units, which are pledged to
the Lender as Collateral under the Pledge Agreement, may be exchanged,
(ii) the product of the Market Price of PGRT Shares for such date
multiplied by the number of PGRT Shares which are pledged to the Lender
as Collateral under the Pledge Agreement, and (iii) the fair market
value on such date of any other Collateral.
FIXED RATE: for any Interest Period, a fixed interest rate per
annum, which rate shall be equal to the LIBOR Rate applicable to such
Interest Period plus 2.50%.
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FLOATING RATE: the Prime Rate in effect from time to time. The
Floating Rate shall change automatically and immediately as and when
the Prime Rate shall change, without notice to Borrower.
GAAP: generally accepted accounting principles as in effect
from time to time, which shall include the official interpretations
thereof by the Financial Accounting Standards Board, consistently
applied.
GOOD FUNDS: United States Dollars available to Lender in
federal funds at or before 2:00 p.m. Chicago time on a Business Day.
GOVERNMENTAL BODY: any foreign, federal, state, municipal or
other government, or any department, commission, board, bureau, agency,
public authority or instrumentality thereof or any court or arbitrator.
GUARANTOR: The Prime Group.
GUARANTY: the Continuing Unconditional Guaranty, substantially
in the form of Exhibit A, issued by Guarantor.
INDEBTEDNESS: all liabilities, obligations and reserves,
contingent or otherwise, which, in accordance with GAAP, would be
reflected as a liability on a balance sheet, including, without
duplication: (i) all Indebtedness for Borrowed Money, (ii) all
obligations under conditional sales or other title retention
agreements, (iii) all obligations secured by any Lien upon Property,
(iv) all guaranties and other contingent obligations, including,
without limitation, letters of credit, and (v) all obligations under
operating leases.
INDEBTEDNESS FOR BORROWED MONEY: without duplication, all
Indebtedness (i) in respect of money borrowed, (ii) evidenced by a
note, debenture or other like written obligation to pay money,
including, only with respect to Borrower and without limitation, all of
Borrower's Obligations, (iii) in respect of rent or hire of Property
under capitalized leases or for the deferred purchase price of Property
or (iv) in respect of obligations under conditional sales or other
title retention agreements, and all guaranties of any and all of the
foregoing.
INTEREST COVERAGE RATIO: for any period, the ratio of (a)
dividends payable on Prime Group Realty Partnership Units and PGRT
Shares to (b) Interest Expense for such period.
INTEREST EXPENSE: for any period, the interest expense of the
Borrower for such period.
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INTEREST PERIOD: as defined in Section 2.7.
INTEREST RATE DETERMINATION DATE: the date on which Lender
determines the Fixed Rate applicable to a requested LIBOR Loan or the
continuation thereof, which shall be the second Business Day prior to
the first day of the Interest Period applicable to such LIBOR Loan.
LIBOR LOAN: each portion of the Loan that is bearing interest
at an applicable Fixed Rate.
LIBOR RATE: with respect to any LIBOR Loan for the applicable
Interest Period, the per annum rate of interest equal to the quotient
obtained by dividing (i) the average per annum interest rate at which
deposits in United States dollars are generally offered in the London
Interbank Market at 11:00 a.m. London, England time, on the Interest
Rate Determination Date, for a period equal to such Interest Period and
in the amount of such LIBOR Loan, by (ii) the difference between 100%
and any applicable reserve requirements (rounded upward to the nearest
whole multiple of 1/100th of one percent per annum) including, without
limitation, any applicable maximum reserve requirements for
"Eurocurrency Liabilities" under Regulation D of the Board of Governors
of the Federal Reserve System (or any similar reserves under any
successor regulations).
LIBOR RATE TAXES: as defined in Section 2.11.1.
LIEN: any mortgage, pledge, assignment, lien, charge,
encumbrance or security interest of any kind, or the interest of a
vendor or lessor under any conditional sale agreement, capitalized
lease, or other title retention agreement.
LOAN: the revolving loan in the maximum principal amount of
$2,300,000 to be made by Lender from time to time to Borrower in
accordance with the terms set forth in Article 2.
LOAN AGREEMENT: this Loan Agreement and any amendments or
supplements hereto.
LOAN DOCUMENTS: (i) Loan Agreement, (ii) Note, (iii) Pledge
Agreement, (iv) Guaranty, (v) appropriate Uniform Commercial Code
financing statements, and (vi) such other instruments and documents as
Lender may require to evidence and perfect the Security Interests
granted pursuant to the Pledge Agreement.
MARKET PRICE: for any date shall be deemed to be (i) so long
as the PGRT Shares are quoted on a national securities exchange or the
National Association of Securities Dealers Automated Quotations
("NASDAQ") National Market System, the reported closing sales price per
share for such security on such date as reported on such national
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securities exchange or NASDAQ, or, if there were no reported sales
transactions on that date, the reported closing sales price per share
for such security for the most recent Business Day (within the previous
ten Business Days) on which sales transactions are reported, or (ii) if
there were no reported transactions on a national securities exchange
or on NASDAQ on that date or within the previous ten Business Days or
if the PGRT Shares are no longer being quoted on a national securities
exchange or on NASDAQ, then as to those securities, zero.
MATERIAL ADVERSE EFFECT: any changes or effects, as the case
may be, that individually or in the aggregate are or can reasonably be
expected to be materially adverse to (i) the ability of Borrower or
Guarantor, or either of them, as the case may be, to fulfill any
covenants or to perform any of their respective obligations under this
Loan Agreement or the other Loan Documents, or (ii) the Lender's rights
to foreclose on the Collateral, to convert any of the Prime Group
Realty Partnership Units into any PGRT Shares, or to sell the
Collateral.
MATURITY DATE: August 22, 2001 or (i) such earlier date on
which the Commitment is reduced to zero or otherwise terminated
pursuant to the terms of this Loan Agreement, or (ii) such later date
through which the Loan may be extended pursuant to Section 2.4.
NOTE: the Revolving Note, substantially in the form of Exhibit
B, executed by Borrower to evidence the maximum amount of the Loan.
PERSON: any individual, firm, corporation, limited liability
company, business enterprise, trust, association, joint venture,
partnership, governmental body or other entity, whether acting in an
individual, fiduciary or other capacity.
PGRT: Prime Group Realty Trust, a Maryland real estate
investment trust.
PGRT REGISTRATION STATEMENT: that certain Registration
Statement No. 333-64973, as amended, relating to, among other things,
11,467,853 PGRT Shares, including the PGRT Shares pledged as Collateral
under the Pledge Agreement.
PGRT SHARES: shares of common stock, $0.01 par value per
share, of PGRT.
PLEDGE AGREEMENT: the Pledge Agreement, in the form of Exhibit
C, by and between Borrower and Lender.
PRIME GROUP REALTY OPERATING PARTNERSHIP: Prime Group Realty,
L.P., a Delaware limited partnership.
PRIME GROUP REALTY PARTNERSHIP UNITS: units of partnership
interest in the Prime Group Realty Operating Partnership.
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PRIME GROUP REALTY REGISTRATION RIGHTS AGREEMENT: means
collectively, (i) that certain Registration Rights Agreement, dated
November 17, 1997, by and among PGRT, Prime Group Realty Operating
Partnership, Prime Group Limited Partnership, an Illinois limited
partnership, Primestone Investment Partners, L.P., a Delaware limited
partnership, and the other investors named therein, and (ii) that
certain Registration Rights Agreement dated as of December 15, 1997
among PGRT, Prime Group Realty Operating Partnership and H Group LLC, a
Delaware limited liability company.
PRIME LOAN: each portion of the Loan that is bearing interest
at the Floating Rate.
PRIME RATE: the per annum rate of interest announced or
published publicly from time to time by Lender at its principal place
of business in Chicago, Illinois, as its prime or equivalent rate of
interest, which rate is not necessarily the lowest rate of interest
charged by Lender with respect to commercial loans.
PRINCIPAL BALANCE: the unpaid principal balance of the Loan
outstanding from time to time.
PROPERTY: as to any Person, all types of real, personal or
mixed property and all types of tangible or intangible property owned
by such Person.
PROSPECTUS: as defined in Section 5.15.
REVOLVER ADVANCE: any advance of the Loan made in accordance
with the terms set forth in Section 2.1.
SEC: the U.S. Securities and Exchange Commission.
SECURITY INTERESTS: the Liens in the Collateral granted to
Lender pursuant to the Pledge Agreement.
THE PRIME GROUP: The Prime Group, Inc., an Illinois corporation.
1.2 TIME PERIODS. In this Loan Agreement and the other Loan Documents,
in the computation of periods of time from a specified date to a later specified
date (i) the word "from" means "from and including", (ii) the words "to" and
"until" each mean "to, but excluding" and (iii) the words "through", "end of"
and "expiration" each mean "through and including". All references in this Loan
Agreement and the other Loan Documents to "month", "quarter" or "year" shall be
deemed to refer to a calendar month, quarter or year.
1.3 ACCOUNTING TERMS. All accounting terms not specifically defined
herein shall be construed, all accounting determinations hereunder shall be made
and all financial statements required to be delivered pursuant hereto shall be
prepared in accordance with GAAP.
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1.4 REFERENCES. All references in this Loan Agreement to "Article",
"Section", "subsection", "subparagraph", "clause" or "Exhibit", unless otherwise
indicated, shall be deemed to refer to an Article, Section, subsection,
subparagraph, clause or Exhibit, as applicable, of this Loan Agreement.
1.5 LENDER'S DISCRETION. Whenever the terms "satisfactory to Lender",
"determined by Lender", "acceptable to Lender", "Lender shall elect", "Lender
shall request" or similar terms are used in this Loan Agreement, except as
otherwise specifically provided in this Loan Agreement, such terms shall mean
satisfactory to, at the election of, determined by, acceptable to or requested
by, as applicable, Lender in its sole and absolute discretion.
1.6 BORROWER'S KNOWLEDGE. Any statements, representations or warranties
which are based upon the knowledge of Borrower shall be deemed to have been
limited to the knowledge, made after due inquiry by Xxxxxxx X. Xxxxxxx,
President of PGLP, Inc., the managing general partner of Borrower, and
President, Chairman and Chief Executive Officer of The Prime Group, and Xxxx X.
Xxxxxx, Vice President and Treasurer of PGLP, Inc., the managing general partner
of Borrower, and the Senior Vice President and Chief Financial Officer of The
Prime Group, or, if such persons are not then serving Borrower in their present
capacities, their successors., with respect to the matter in question.
1.7 MARKET PRICE ADJUSTMENTS. In the event of a stock dividend, stock
split or combination or other reduction in the number of issued and outstanding
PGRT Shares, as to such affected securities, any applicable Market Price per
share specified in this Loan Agreement shall be proportionately and
appropriately adjusted to reflect such dividend, split or combination or other
reduction.
ARTICLE 2
LOAN AND TERMS OF PAYMENT
2.1 REVOLVING LOAN.
2.1.1 AMOUNT. The Loan is a revolving loan which shall be made
available to Borrower by Lender from time to time on and after the
Closing Date in the maximum amount outstanding at any one time in the
amount of the Commitment; provided, however, that the aggregate
principal amount of the Loan which shall be outstanding hereunder at
any time shall not exceed the Available Borrowing Base. Subject to the
limitations set forth in this Article 2, from the Closing Date through
the Maturity Date Borrower may reborrow all or any Revolver Advance
which is repaid or prepaid.
2.1.2 PROCEDURE FOR BORROWING. Each Revolver Advance shall be
made on any Business Day by Lender after Borrower has made an
irrevocable written or telephonic request to Lender for a Revolver
Advance, provided, however, if such request is received
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by Lender after 12:00 p.m., Chicago time, on a Business Day, such
request shall be deemed to have been made on the next Business Day. If
such Revolver Advance is to bear interest at the Floating Rate, then
such Revolver Advance shall be made on the same Business Day as the
date such request is made or deemed to have been made; if such Revolver
Advance is to bear interest at the Fixed Rate in accordance with the
terms of Sections 2.6 and 2.7 below, then such Revolver Advance shall
be made on the third Business Day following the date such request is
made or deemed to have been made. The amount of such Revolver Advance
shall not be less than $100,000, subject to the additional restrictions
set forth in Section 2.1.1 and Section 2.6.1. Each request for a
Revolver Advance shall be deemed a certification by Borrower that no
Default or Event of Default exists or will be created if the requested
Revolver Advance is made. Lender shall not be obligated to make any
Revolver Advance if (i) a Default or Event of Default exists or will be
created if the requested Revolver Advance is made, or (ii) after making
such Revolver Advance, the outstanding aggregate principal amount of
the Loan will exceed the Available Borrowing Base at such time.
2.2 DISBURSEMENT OF LOAN ON CLOSING DATE. Provided (i) no Default or
Event of Default shall be in existence on the Closing Date and (ii) all of the
terms and conditions set forth in Article IV below shall have been satisfied, on
the Closing Date and subject to the provisions of Section 2.1.1 above, Lender
shall advance to Borrower such amount of the Loan as Borrower shall request.
2.3 INTEREST. Borrower's Obligations shall bear interest computed and
payable as follows:
2.3.1 INTEREST RATE. The principal balance of the Loan
outstanding from time to time shall bear interest at a per annum rate
equal to the Floating Rate in effect from time to time, subject to the
LIBOR option in Section 2.6.
2.3.2 INTEREST PAYMENTS. Accrued and unpaid interest on the
Principal Balance of the Loan shall be due and payable monthly in
arrears on the first Business Day of each month, commencing October 1,
2000.
2.3.3 INTEREST COMPUTATION. Interest shall be: (a) computed on
the basis of a year consisting of 360 days and (b) payable for the
actual number of days during the period for which interest is being
charged.
2.3.4 MAXIMUM INTEREST. Notwithstanding any provision to the
contrary herein contained, Lender shall not collect a rate of interest
on any obligation or liability due and owing by Borrower to Lender in
excess of the maximum contract rate of interest permitted by applicable
law. Lender and Borrower have agreed that the interest laws of the
State of Illinois shall govern the relationship between them, but in
the event of a final adjudication to the contrary, Borrower shall be
obligated to pay to Lender only such
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interest as then shall be permitted by the laws of the state found to
govern the contract relationship between Lender and Borrower. All
interest found in excess of that rate of interest allowed and collected
by Lender shall be applied as a repayment of the Principal Balance in
such manner as to prevent the payment and collection of interest in
excess of the rate permitted by applicable law.
2.4 PRINCIPAL PAYMENTS; MATURITY. The outstanding Principal Balance of
the Loan shall be paid in full not later than the Maturity Date; PROVIDED,
HOWEVER, that upon Borrower's request, Lender may agree, in Lender's discretion,
to extend the Maturity Date for an additional 12-month period. Borrower shall
request any such extension in writing no later than ten (10) days prior to the
Maturity Date.
2.5 PREPAYMENT.
2.5.1 VOLUNTARY PREPAYMENT. All or a portion of the Principal
Balance of the Loan may be prepaid at any time without premium or
penalty, PROVIDED that Borrower shall also pay, with such prepayment,
all Break Costs incurred by Lender, if any. All prepayments of the Loan
pursuant to this subsection 2.5.1 shall be accompanied by the payment
of any accrued and unpaid interest on the portion of the Principal
Balance being prepaid to the date on which Lender is in receipt of Good
Funds, and any other sums which are due and payable pursuant to the
terms of the Loan Documents.
2.5.2 MANDATORY PREPAYMENT. If, as of 3:30 p.m., Chicago time,
on any Business Day, the outstanding Principal Balance of the Loan
exceeds the amount of the Available Borrowing Base on such Business Day
then, not later than 3:00 p.m., Chicago time, on the next Business Day,
Borrower shall either (i) repay the amount of such excess without
notice or demand or (ii) pledge to the Lender collateral, cash or cash
equivalents (acceptable to the Lender) in such amount sufficient to
eliminate such excess. Any payment made pursuant to this subsection
2.5.2 shall be accompanied by accrued interest on the amount paid
through the date on which Lender is in receipt of Good Funds and in the
case of LIBOR Loans, all Break Costs. Such payment shall first be
applied to the Floating Loans and then to the LIBOR Loans.
2.6 LIBOR OPTION.
2.6.1 OPTION. Subject to the provisions of Sections 2.7 and
2.8, Borrower shall have the option (i) to request that a Revolver
Advance be made at the Fixed Rate rather than the Floating Rate, (ii)
to convert at any time the interest rate charged on all or any part of
the Principal Balance of the Loan from the Floating Rate to a Fixed
Rate; or (iii) upon the expiration of any Interest Period applicable to
a LIBOR Loan, to continue all or any portion of the same as a LIBOR
Loan, and the succeeding Interest Period of such continued LIBOR Loan
shall commence on the expiration date of the Interest Period applicable
thereto; provided, that no portion of the outstanding Loan may be
continued as,
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or be converted into, a LIBOR Loan when any Event of Default or Default
has occurred and is continuing. Any Revolver Advance to be made at a
Fixed Rate and any partial conversion of the Loan to a Fixed Rate or
continuation of the Loan at a Fixed Rate under this Section shall be in
a minimum amount of $100,000, and in integral multiples of $50,000 in
excess of that amount.
2.6.2 NOTICE PROCEDURE. If Borrower requests a Revolver
Advance at the Fixed Rate or if Borrower desires to convert all or a
portion of the Loan to a LIBOR Loan or to continue all or any portion
of a LIBOR Loan as a LIBOR Loan, Borrower shall notify Lender no later
than 12:00 p.m. (Chicago time) on the third Business Day prior to the
aforementioned request or the proposed conversion or continuation date.
Each notice shall specify (i) the proposed Revolver Advance
disbursement date or the conversion or continuation date (which shall
be a Business Day), as applicable, (ii) the principal amount of the
applicable Revolver Advance or the principal amount of the Loan to be
converted to or continued as a LIBOR Loan, as applicable, and (iii) the
requested Interest Period. In lieu of delivering the above-described
notice, Borrower may give Lender telephonic notice of any proposed
LIBOR Loan or the conversion or continuation of a LIBOR Loan by the
time required under this Section; PROVIDED, that such notice is
confirmed in writing by delivery or fax to Lender of such notice in no
event later than 4:00 p.m. (Chicago time) on the date of such
telephonic notice.
2.6.3 NOTICE IRREVOCABLE. Notice of any proposed LIBOR Loan or
of conversion to a LIBOR Loan or continuation of a LIBOR Loan (or
telephonic notice in lieu thereof) shall be irrevocable and Borrower
shall be bound in accordance with the terms of such notice.
2.6.4 FAILURE TO PROVIDE NOTICE OF CONTINUATION. If notice of
the continuation of a LIBOR Loan is not delivered by Borrower in a
timely manner, the amount of such LIBOR Loan shall bear interest at the
Floating Rate as of the termination date of the applicable Interest
Period and shall no longer bear interest at the Fixed Rate unless it is
thereafter converted to a new LIBOR Loan in the manner described above.
2.7 INTEREST PERIODS. By giving notice as required hereunder, Borrower
shall have the option, subject to the other provisions of this Section, to
specify a one-, two-, three-, four-, five- or six-month interest period (each an
"Interest Period") during which all or a portion of the Loan shall bear (or, if
already a LIBOR Loan, continue to bear) interest at the LIBOR Rate. The
determination of Interest Periods shall be subject to the following provisions:
(a) In the case of immediately successive Interest Periods,
each successive Interest Period shall commence on the day on which the
immediately preceding Interest Period expires;
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(b) If any Interest Period would otherwise expire on a day
which is not a Business Day, the Interest Period shall be extended to
expire on the next succeeding Business Day (unless the next succeeding
Business Day is in the next calendar month, in which event the Interest
Period shall expire on the immediately preceding Business Day);
(c) Borrower may not select an Interest Period which
terminates later than the Maturity Date;
(d) There shall be no more than four (4) Interest Periods with
respect to the Loan in effect at any one time.
2.8 SPECIAL PROVISIONS GOVERNING LIBOR LOANS.
2.8.1 DETERMINATION OF INTEREST RATE. On the Interest Rate
Determination Date, Lender shall determine (which determination shall,
absent manifest error, be presumptively correct) the Fixed Rate that
shall apply to the subject LIBOR Loan and shall promptly give notice
thereof to Borrower. If on any Interest Rate Determination Date Lender
is unable to obtain the applicable LIBOR Rate quotations, Lender shall
give Borrower prompt notice thereof and such requested LIBOR Loan shall
automatically become a Prime Loan and shall bear interest at the
Floating Rate.
2.8.2 INTEREST RATE UNASCERTAINABLE, INADEQUATE OR UNFAIR. If,
with respect to any Interest Period, (i) any change occurs in any
applicable law or governmental rule, regulation or order (or any
interpretation thereof and including the introduction of any new law or
governmental rule, legislation or order) affecting the interbank
Eurodollar market for such Interest Period, or (ii) other circumstances
affecting the interbank Eurodollar market for such Interest Period
results in the then applicable Fixed Rates not adequately reflecting
the cost to Lender of making or funding the LIBOR Loans, Lender shall
give notice thereof to Borrower, whereupon until Lender has determined
that the circumstances giving rise to such inadequacy no longer exist,
(A) the right of Borrower to elect to have any portion of the Loan bear
interest based upon the Fixed Rate shall be suspended for such Interest
Period, and (B) each outstanding LIBOR Loan shall bear interest at the
Floating Rate commencing on the last day of the then current Interest
Period therefor, notwithstanding any prior election by Borrower to the
contrary.
2.9 ILLEGALITY. In the event that on any date Lender shall have
reasonably determined that the making or continuation of any LIBOR Loan has
become unlawful by compliance by Lender in good faith with any law, governmental
rule, regulation or order of any Governmental Body, then Lender shall promptly
give notice to Borrower of that determination. Upon the giving of such notice,
Borrower's right to request of Lender and Lender's obligation to make LIBOR
Loans shall be immediately suspended to the extent specified in such notice, and
if any LIBOR Loans are then outstanding, each such LIBOR Loan shall immediately
become a Prime Loan and shall commence bearing interest at the Floating Rate. If
Lender determines at any time
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following its giving of the aforementioned notice that Lender may lawfully make
LIBOR Loans of the type(s) referred to in such notice, Lender shall promptly
give notice to Borrower of such determination, whereupon Borrower's right to
request of Lender and Lender's obligation to make LIBOR Loans of such type shall
be restored.
2.10 COMPENSATION. Borrower shall indemnify Lender, within five (5)
Business Days following Borrower's receipt of the written statement described
below, for all losses, expenses and liabilities (including, without limitation,
any loss or expense incurred by reason of liquidation or reemployment of
deposits or other funds acquired by Lender to fund or maintain Lender's LIBOR
Loans to Borrower) which Lender may sustain (i) if such LIBOR Loans are not made
when requested due to Borrower's actions or inactions, (ii) if any prepayment of
any LIBOR Loan occurs for any reason on a date which is not the last day of the
applicable Interest Period, or (iii) as a consequence of any required conversion
of the interest rate applicable to a LIBOR Loan to a Floating Rate, (such
losses, expenses and liabilities being collectively referred to as "Break
Costs"). Lender shall promptly deliver to Borrower a written statement as to
such Break Costs, which statement shall be rebuttably presumed correct. The
maximum amount of any indemnification under this Section 2.10 shall not exceed
the interest which would have been payable for the balance of the applicable
Interest Period for the aforesaid LIBOR Loans.
2.11 LIBOR RATE TAXES. Borrower agrees that:
2.11.1 ADDITIONAL PAYMENTS. Borrower shall pay, prior to the
date on which penalties attach thereto, all present and future stamp
and other taxes, levies, or costs and charges whatsoever imposed,
assessed, levied or collected on or in respect of the Loan solely as a
result of the interest rate being determined by reference to the LIBOR
Rate or any payments of principal, interest or other amounts made on or
in respect of a Loan made to Borrower when the interest rate is
determined by reference to the LIBOR Rate (all such taxes, levies,
costs and charges being herein collectively called "LIBOR Rate Taxes");
PROVIDED HOWEVER, that LIBOR Rate Taxes shall not include income or
franchise taxes imposed by any jurisdiction (except that Borrower shall
be liable for the payment of the amount of any additional net income or
franchise taxes attributable to payments made by Borrower pursuant to
this Section).
2.11.2 INDEMNITY. Borrower shall indemnify Lender against, and
reimburse Lender within five (5) Business Days after Lender's written
demand for, any LIBOR Rate Taxes paid by Lender. Lender shall provide
Borrower with appropriate receipts for any payments or reimbursements
made by Borrower pursuant to this Section as a result of the Loan.
2.12 DEFAULT RATE. During a Default Period, the Principal Balance shall
bear interest at the Default Rate.
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2.13 METHOD OF PAYMENT; GOOD FUNDS. All payments to be made by Borrower
pursuant to the Loan Documents shall be delivered to Lender at 000 Xxxxx XxXxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, or to such other address as Lender shall notify
Borrower. Payment shall not be deemed to have been received by Lender until
Lender is in receipt of Good Funds.
2.14 DEPOSIT TO BORROWER'S ACCOUNT. Lender may, at its option, deposit
the proceeds of the Loan into a working capital account maintained by Borrower
with Lender and shall have the right to debit such account (or any other account
or deposit maintained or made by Borrower with Lender) from time to time for any
of Borrower's Obligations that are due and payable.
ARTICLE 3
NOTE AND SECURITY
3.1 NOTE. The Loan shall be evidenced by the Note.
3.2 SECURITY. All Borrower's Obligations shall be secured by the Pledge
Agreement.
ARTICLE 4
CONDITIONS OF FUNDING
Lender's obligation to make any Revolver Advance shall be subject to
the satisfaction of all of the following conditions in a manner, form and
substance reasonably satisfactory to Lender:
4.1 INITIAL ADVANCE. The obligation of the Lender to make the initial
Revolver Advance is, in addition to the conditions precedent specified in
Section 4.2, subject to the following being delivered to Lender, each duly
authorized and executed:
(a) the Loan Documents;
(b) a certificate of the general partner of Borrower,
certifying on the Closing Date:
(i) the certificate of limited partnership of
Borrower, certified by the Secretary of State of the state of
organization of Borrower, as of a date within the month in
which the Closing Date occurs; and
(ii) the agreement of limited partnership of
Borrower;
13
(c) a certificate of the managing general partner of Prime
Group Realty Operating Partnership, certifying on the Closing Date:
(i) the certificate of limited partnership of such
partnership, certified by the Secretary of State of the state
of organization of such partnership, as of a date within the
month in which the Closing Date occurs; and
(ii) the agreement of limited partnership of such
partnership;
(d) a certificate of the Secretary or Assistant Secretary of
PGLP, Inc. and The Prime Group, certifying on the Closing Date:
(i) the certificate or articles of incorporation, and
all amendments thereto, of such Person, certified by the
Secretary of State of the state of organization of such
Person, as of a date within the month in which the Closing
Date occurs;
(ii) the by-laws, and all amendments thereto, of such
Person;
(iii) Copies of the resolutions of such Person
approving and authorizing the execution, delivery and
performance by such Person (as to PGLP, Inc., in its own
capacity and in its capacity as managing general partner of
Borrower) of the Loan Documents to be executed or delivered by
it (or, as to PGLP, Inc., by Borrower) hereunder; and
(iv) the names and true signatures of the officers of
such Person authorized to execute, deliver and perform, as
applicable, the Loan Documents to be executed or delivered by
it hereunder;
(e) a certificate of existence, as of a date within the month
in which the Closing Date occurs, from the Secretary of State of the
state of organization for (i) Borrower, and (ii) Prime Group Realty
Operating Partnership;
(f) a good standing certificate, as of a date within the month
in which the Closing Date occurs, from the Secretary of State of the
state of incorporation for The Prime Group, PGLP, Inc. and PGRT;
(g) opinions of counsel for Borrower and Guarantor, in form
and substance satisfactory to Lender;
(h) a borrowing base certificate (as described in Section
6.3.4);
(i) all filings of Uniform Commercial Code Financing
Statements and all other recordings and actions necessary to perfect
and maintain the Security Interests as
14
first, valid and perfected liens and security interests in the
Collateral shall have been filed or taken and confirmation thereof
received;
(j) all necessary consents under (i) the agreement of limited
partnership for the Prime Group Realty Operating Partnership (the
"Partnership Agreement"), and (ii) the Prime Group Realty Registration
Rights Agreement approving (1) the transactions contemplated by the
Loan Documents, including, but not limited to, the pledge of the Prime
Group Realty Partnership Units (owned by the Borrower) under the Pledge
Agreement; (2) the exercise of Lender's rights hereunder and under the
Pledge Agreement upon the occurrence of any Event of Default; (3) the
exchange of the Prime Group Realty Partnership Units (owned by the
Borrower) for PGRT Shares; and (4) the registration of such PGRT Shares
with the SEC as provided under the Prime Group Realty Registration
Rights Agreement;
(k) a copy of the Prospectus;
(l) payment of all amounts for fees and expenses owning to
Lender under this Loan Agreement; and
(m) such other instruments, documents, certificates, consents,
waivers and opinions necessary to consummate the transactions
contemplated in this Loan Agreement and in the other Loan Documents, or
as Lender may reasonably request.
4.2 ALL REVOLVER ADVANCES. The obligation of Lender to make any
Revolver Advance is subject to the following further conditions precedent that:
4.2.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Borrower and Guarantor, as the case may be, set forth in
this Loan Agreement and the other Loan Documents shall be true and
correct in all material respects as of the date such Revolver Advance
is made, except for any representation or warranty limited by its terms
to a specific date and taking into account any disclosures made in
writing pursuant to the terms of this Loan Agreement.
4.2.2 PERFORMANCE; NO DEFAULT. Borrower shall have performed
and complied with all agreements and conditions contained in the Loan
Documents to be performed by or complied with prior to such Revolver
Advance and no Event of Default of Default then exists.
15
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Lender as follows:
5.1 BORROWER. Borrower is a limited partnership duly formed and validly
existing under the laws of the State of Illinois. The Borrower is duly qualified
in each jurisdiction in which the failure to so qualify could have a Material
Adverse Effect on Borrower. The Borrower has full power and authority to execute
and deliver the Loan Documents and to perform its obligations hereunder and
thereunder. The agreement of limited partnership of Borrower, as amended, a copy
of which has been furnished to Lender, is true, correct and complete.
5.2 PARTNERS OF BORROWER. The managing general partner of Borrower is
PGLP, Inc. and the limited partners of Borrower are Prime Group II, L.P., an
Illinois limited partnership, Prime Group Limited Partnership, an Illinois
limited partnership, The Prime Group, and Prime International, Inc., an Illinois
corporation. PGLP, Inc. is a duly formed corporation, validly existing and in
good standing in the State of Illinois and qualified to do business in each
jurisdiction in which failure to do so would have a Material Adverse Effect on
PGLP, Inc.
5.3 AUTHORITY. No consent or approval of, or other action by, any
partner, Governmental Body or any other Person, which has not already been
obtained, is required to be obtained by Borrower to authorize, or is required to
be obtained by Borrower in connection with the execution, delivery and
performance of, the Loan Documents, or is required as a condition to the
validity or, subject to the terms of the Partnership Agreement, enforceability
of the Security Interests or any of the Loan Documents.
5.4 NECESSARY ASSETS. Borrower owns all of the assets necessary to
operate and maintain the operations of the Business.
5.5 BINDING AGREEMENTS. This Loan Agreement and the other Loan
Documents, when executed and delivered, will constitute the valid and legally
binding obligations of Borrower, and will be enforceable against Borrower in
accordance with their respective terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and by
equitable principles.
5.6 BORROWER'S SECURITIES. As of the Closing Date, Borrower owns 47,525
Prime Group Realty Partnership Units and 256,572 PGRT Shares (collectively, the
"Borrower's Securities").
5.7 TITLE TO PROPERTY; LIENS. Borrower has good and marketable title to
all of the Collateral free and clear of all Liens, except for Liens created or
contemplated by the Loan
16
Documents. The applicable Loan Documents create a valid and perfected Lien in
the Collateral described therein.
5.8 FINANCIAL STATEMENTS. The financial statements previously delivered
to Lender present fairly the financial condition and the results of the
operations of Borrower and Guarantor as of the dates and for the periods
indicated therein.
5.9 LITIGATION. To the knowledge of Borrower, there are no actions,
suits, arbitration proceedings or claims pending or threatened at law or in
equity or before any Governmental Body which, if adversely determined, could
have a Material Adverse Effect on Borrower or Guarantor. As of the Closing Date,
to the knowledge of Borrower, there are no proceedings pending or threatened
which call into question the validity or enforceability of any of this Loan
Agreement or the other Loan Documents or any of the transactions contemplated
hereby or thereby.
5.10 CONFLICTING AGREEMENTS. Borrower is not in default under any
agreement to which it is a party or by which Borrower or any of its Property is
bound, the effect of which default has resulted in the termination of such
agreement and such termination will have a Material Adverse Effect on Borrower.
No authorization or approval or other action by, and no notice to or filing
with, any Governmental Body which has not been obtained, given or made by
Borrower is required for the due execution, delivery and performance by Borrower
of any of the Loan Documents. No provision of any mortgage, indenture, contract
or agreement to which Borrower is a party conflicts with, or requires any
consent which has not already been obtained or is anticipated to be obtained as
described above, or in any way would prevent the execution, delivery or
performance of the terms of, any of the Loan Documents. Neither the execution,
delivery, or carrying out of the terms of the Loan Documents will constitute a
default under, or result in the creation or imposition of, or obligation to
create, any Lien upon the Property of Borrower pursuant to the terms of any such
mortgage, indenture, contract or agreement. Neither the execution and deliver by
Borrower of the Loan Documents, nor the consummation of the transactions therein
contemplated, nor compliance with the provisions thereof will violate any law,
rule, regulation, order, writ, judgment, injunction, decree or award binding on
Borrower, except where such violation could not reasonably be expected to have a
Material Adverse Effect.
5.11 COMPLIANCE WITH APPLICABLE LAWS. Borrower is not in default in
respect of any judgment, order, writ, injunction, decree or decision of any
Governmental Body, which default would have a Material Adverse Effect on
Borrower. Borrower is in compliance in all material respects with all applicable
statutes and regulations of all Governmental Bodies, a violation of which would
have a Material Adverse Effect on Borrower.
5.12 APPLICATION OF CERTAIN LAWS AND REGULATIONS.
17
5.12.1 INVESTMENT COMPANY ACT. Borrower is not an "investment
company," or a company "controlled" by an "investment company," within
the meaning of the Investment Company Act of 1940, as amended.
5.12.2 HOLDING COMPANY ACT. Borrower is not a "holding
company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company," as such terms are defined in the Public Utility
Holding Company Act of 1935, as amended.
5.13 MARGIN REGULATIONS. None of the transactions contemplated by this
Loan Agreement or any of the other Loan Documents, including the use of proceeds
of the Loan, will violate or result in a violation of Section 7 of the Exchange
Act, or any regulations issued pursuant thereto, including, without limitation,
Regulations T, U and X.
5.14 NO MISREPRESENTATION. To Borrower's knowledge, no representation
or warranty contained herein and no certificate, information or report furnished
or to be furnished by Borrower in connection with any of the Loan Documents or
any of the transactions contemplated hereby or thereby contains or will contain
a misstatement of material fact, or omits or will omit to state a material fact
required to be stated in order to make the statements contained herein or
therein not misleading in light of the circumstances under which such statements
were made. To Borrower's knowledge, there is no fact which has not expressly
been disclosed to Lender in writing, or so far as Borrower reasonably can
foresee, that will have a Material Adverse Effect on Borrower or Guarantor.
5.15 REGISTRATION EFFECTIVE. The PGRT Registration Statement, with
respect to the PGRT Shares now owned by the Borrower and pledged as Collateral
under the Pledge Agreement, and the PGRT Shares issuable upon exchange of the
Prime Group Realty Partnership Units now owned by the Borrower, has been
declared effective under the Securities Act of 1933, as amended, a prospectus
has been filed under Rule 424(b)(3) promulgated under said Act, naming the
Borrower and its pledgees as "Selling Shareholders" (the "Prospectus"), and to
Borrower's knowledge, no "stop order" suspending the effectiveness of the PGRT
Registration Statement or preventing or suspending the use of the Prospectus has
been issued, nor has any proceeding for the issuance of such an order been
initiated or threatened.
ARTICLE 6
AFFIRMATIVE COVENANTS
Until all of Borrower's Obligations are paid and performed in full,
Borrower agrees as follows:
6.1 LEGAL EXISTENCE; GOOD STANDING. Borrower shall maintain its
existence in its jurisdiction of organization and maintain its qualification in
any jurisdiction in which failure to
18
be so qualified would have a Material Adverse Effect. The Guarantor shall
maintain its existence and remain in good standing in its jurisdiction of
incorporation and in any jurisdiction in which failure to be so qualified would
have a Material Adverse Effect.
6.2 INSPECTION. Borrower will permit representatives of Lender to visit
its offices to examine its books and records and Accountants' reports relating
thereto, and to make copies or extracts therefrom, and to discuss its business
and affairs with its employees, all at reasonable times, upon reasonable prior
notice, and, at all reasonable times and upon reasonable prior notice, to
examine and inspect its Property and to meet and discuss the business and its
affairs with the Accountants.
6.3 FINANCIAL STATEMENTS AND OTHER INFORMATION OF BORROWER. Borrower
will maintain a system of accounting in accordance with GAAP and furnish to
Lender:
6.3.1 ANNUAL STATEMENTS. As soon as available and in any event
within 120 days after the close of each fiscal year, a copy of (a) the
balance sheet of Borrower as of the end of such year, and (b) the
statements of income and cash flow of Borrower for such year, setting
forth in each case (beginning with the 2000 financial statements) in
comparative form the corresponding figures for the preceding year, all
in reasonable detail, and in each case audited by the Accountants. Such
annual statements shall be accompanied by a report of the Accountants
which states that in making the audit of the financial statements of
Borrower, nothing of a financial or accounting nature came to the
attention of the Accountants that caused them to believe that Borrower
was not in compliance with the terms, covenants, provisions, or
conditions of any of the Loan Documents or that there shall have
occurred a condition or event that constitutes an Event of Default (or,
if applicable, specifying in such certificate the nature and status of
any instances of non-compliance or Events of Default), and which is
otherwise in a form reasonably satisfactory to Lender.
6.3.2 NOTICE OF DEFAULTS; LOSS. Immediate written notice if:
(i) any Indebtedness aggregating in excess of $100,000, with respect to
the Borrower, or $1,000,000 with respect to the Guarantor, is declared
or shall become due and payable prior to its declared or stated
maturity (other than regularly scheduled payments), or called and not
paid when due, (ii) the holder of any note, or other evidence of
Indebtedness, certificate or security evidencing any such Indebtedness
aggregating in excess of $100,000, with respect to the Borrower, or
$1,000,000 with respect to the Guarantor, has the right to declare such
Indebtedness due and payable prior to its stated maturity, (iii) there
shall occur and be continuing a Default or Event of Default,
accompanied by a certified statement of an authorized officer of PGLP,
Inc., as managing general partner of Borrower, or an authorized officer
of Guarantor setting forth what action Borrower or Guarantor, as the
case may be, proposes to take in respect thereof, or (iv) any event
shall occur causing loss or depreciation in the value of assets having
a Material Adverse Effect upon the business or operations of Borrower
or Guarantor,
19
including the amount or the estimated amount of any such loss or
depreciation or adverse effect.
6.3.3 NOTICE OF SUITS, ADVERSE EVENTS. Prompt written notice
of: (i) any citation, summons, subpoena, order to show cause or other
order naming Borrower or Guarantor a party to any proceeding involving
in excess of $1,000,000 and include with such notice a copy of such
citation, summons, subpoena, order to show cause or other order, (ii)
any lapse or other termination of any material license, permit,
franchise, agreement or other authorization issued to Borrower or
Guarantor by any Governmental Body or any other Person, (iii) any
refusal by any Governmental Body or any other Person to renew or extend
to Borrower or Guarantor any such material license, permit, franchise,
agreement or other authorization and (iv) any dispute between Borrower
or Guarantor and any Governmental Body or any other Person, which
lapse, termination, refusal or dispute referred to in clauses (ii) or
(iii) above or in this clause (iv) may have a material adverse effect
on the financial condition, operations, business, prospects or Property
of Borrower or Guarantor.
6.3.4 COVENANT COMPLIANCE CERTIFICATE; BORROWING BASE
CERTIFICATE. On or before the 20th day after the end of each calendar
quarter, a compliance certificate in a form reasonably satisfactory to
Lender stating whether Borrower is in compliance with the terms,
covenants, provisions and conditions of the Loan Documents and
specifying any condition or event that constitutes an Event of Default
set forth in Article 8 hereof, together with any supporting
documentation reasonably requested by Lender. On the date of each
requested Revolver Advance, and on or before the 5th day after the end
of each month, a borrowing base certificate in a form reasonably
satisfactory to Lender setting forth the calculation of the Available
Borrowing Base as of the close of business of the Business Day
immediately preceding the date of such Revolver Advance or as of the
end of the preceding month, as applicable.
6.3.5 OTHER INFORMATION. Such other information and reports
relating to the past, present or future financial condition,
operations, plans and projections of Borrower as Lender reasonably may
request from time to time.
6.4 INTENTIONALLY OMITTED.
6.5 REPORTS TO GOVERNMENTAL BODIES AND OTHER PERSONS. Borrower will
file, all on a timely basis, all reports, applications, documents, instruments
and information required to be filed pursuant to all rules, regulations or
requests of any Governmental Body or other Person having jurisdiction over the
operation of Borrower, including, but not limited to, such of the Loan Documents
as may be required to be filed with any such Governmental Body or other Person
pursuant to applicable rules and regulations promulgated by such Governmental
Body or other Person, unless the failure to file would not reasonably be
expected to have a Material Adverse Effect.
20
6.6 GENERAL PARTNER. PGLP, Inc. or a "Prime Group Entity" at all times
shall remain the general partner of Borrower. As used herein, a "Prime Group
Entity" shall mean (i) PGLP, Inc., (ii) The Prime Group, (iii) any person in
which The Prime Group or PGLP, Inc. has a beneficial ownership of 51% or more of
the voting interests in such person, (iv) any entity controlling, controlled by
or under common control with, The Prime Group or PGLP, Inc., or (v) any entity
in which The Prime Group or PGLP, Inc., or officers, directors and employees of
The Prime Group or PGLP, Inc. own, directly or indirectly, a controlling
interest.
6.7 FINANCIAL STATEMENTS OF GUARANTOR. Borrower will cause Guarantor to
furnish to Lender as soon as available and in any event within 180 days after
the close of each fiscal year, a copy of Guarantor's (a) balance sheet as of the
end of such year, and (b) statements of income and cash flow for such year,
setting forth in each case (beginning with the 2000 financial statements) in
comparative form the corresponding figures for the preceding year, all in
reasonable detail, and in each case audited by the Accountants.
6.8 MINIMUM INTEREST COVERAGE RATIO. Borrower shall maintain an
Interest Coverage Ratio of at least 1.75 to 1.00 at all times.
ARTICLE 7
NEGATIVE COVENANTS
Borrower shall not:
7.1 Engage in any business other than the Business or otherwise
materially change the nature of the Business of Borrower as it exists on the
Closing Date.
7.2 Amend, modify or waive any term or provision of Borrower's
certificate of limited partnership or agreement of limited partnership in a
manner that would have a Material Adverse Effect.
7.3 Sell, lease, assign, transfer, pledge, hypothecate or otherwise
dispose of or grant any security interest in any of Borrower's Securities
pledged as Collateral, except as permitted by Section 5.7.
7.4 Consent to any alteration or modification of any provision
affecting the Prime Group Realty Partnership Units, which alteration or
modification would have a Material Adverse Effect.
21
ARTICLE 8
DEFAULT AND REMEDIES
8.1 EVENTS OF DEFAULT. The occurrence of any of the following shall
constitute an Event of Default under the Loan Documents:
8.1.1 DEFAULT IN PAYMENT. If Borrower shall fail to pay all or
any portion of Borrower's Obligations on or before the fifth Business
Day following the date on which the same become due and payable.
8.1.2 BREACH OF COVENANTS AND CERTAIN OTHER PROVISIONS.
(a) If Borrower shall fail to observe or perform any covenant
or agreement made by Borrower contained in Article VI (except for
Sections 6.1 and 6.5) or in Article VII.
(b) If Borrower shall fail to observe or perform any covenant
or agreement (other than those referred to in subparagraph (a) above)
made by Borrower in any of the Loan Documents, and such failure shall
continue for a period of 30 days after the earlier of (i) the written
notice of such failure is given to Borrower by Lender or (ii) the date
Borrower shall have actual knowledge of such failure; PROVIDED,
HOWEVER, that if such default is of a nature that it cannot be cured
within thirty (30) days and Borrower commences and diligently proceeds
to cure such default, such cure period shall be extended for such
period of time as required to cure such default but in no event more
than thirty (30) additional days.
(c) Any alterations, modifications or amendments are made to
the certificate or articles of incorporation of PGRT or to any other
agreement that would adversely alter in any material manner the rights
afforded to holders of Collateral consisting of Prime Group Realty
Partnership Units in the Amended and Restated Agreement of Limited
Partnership of Prime Group Realty, L.P., as further amended, to convert
such Prime Group Realty Partnership Units into PGRT Shares.
8.1.3 BREACH OF WARRANTY. Any representation or warranty made
by Borrower or Guarantor in or pursuant to any of the Loan Documents to
which Borrower or Guarantor is a party or in any instrument or document
furnished in compliance with the Loan Documents shall prove to be false
or misleading in any material respect as of the date on which made.
8.1.4 ACCELERATION OF ANY INDEBTEDNESS. If Borrower or
Guarantor at any time shall be in default (as principal or guarantor or
other surety) in the payment of any principal of or premium or interest
on any Indebtedness for Borrowed Money in excess of
22
$100,000, with respect to Borrower (other than Borrower's Obligations),
or $1,000,000, with respect to Guarantor, and in each case such default
has resulted in an acceleration of the maturity of such Indebtedness
for Borrowed Money which is not paid promptly upon acceleration.
8.1.5 BANKRUPTCY.
(a) If Borrower or Guarantor or, to the extent, and for so
long as, the shares or limited partnership units of such Person (or, in
the case of PGRT, shares of limited partnership units that are
exchangeable into shares of such Person) have been pledged to Lender as
security for the Loan, the Prime Group Realty Operating Partnership or
PGRT shall (i) generally not be paying, or admit in writing its
inability to pay, its debts as they become due, (ii) file, or consent,
by answer or otherwise, to the filing against any of such entities, of
a petition for relief or reorganization or arrangement or any other
petition in bankruptcy or insolvency under the laws of any
jurisdiction, (iii) make an assignment for the benefit of creditors,
(iv) consent to the appointment of a custodian, receiver, trustee or
other officer with similar powers for, or for any substantial part of
the Property owned by any of such entities, (v) be adjudicated
insolvent, or (vi) take a corporate action to authorize any of the
foregoing.
(b) If any Governmental Body of competent jurisdiction shall
enter an order appointing, without consent of Borrower or Guarantor or,
to the extent, and for so long as, the shares or limited partnership
units of such Person (or, in the case of PGRT, shares of limited
partnership units that are exchangeable into shares of such Person)
have been pledged to Lender as security for the Loan, the Prime Group
Realty Operating Partnership or PGRT, a custodian, receiver, trustee or
other officer with similar powers with respect to any of such Persons,
or with respect to any substantial part of the Property belonging to
Borrower or such Person, or if an order for relief shall be entered in
any case or proceeding for liquidation or reorganization or otherwise
to take advantage of any bankruptcy or insolvency law of any
jurisdiction, or ordering the dissolution, winding-up or liquidation of
any of such entities, or if any petition for any such relief shall be
filed against any of such entities and such order or petition shall not
be dismissed within 90 days.
8.1.6 JUDGMENTS. If there shall exist final judgments against
Borrower or Guarantor which shall have been outstanding for any period
of 30 days or more from the date of the entry thereof and shall not
have been discharged in full or stayed pending appeal and if the
aggregate amount thereof exceeds $100,000, with respect to Borrower, or
$1,000,000, with respect to Guarantor.
8.1.7 NON-PERFORMANCE OF GUARANTY, ETC. Guarantor shall fail
(subject to any applicable notice, cure or grace period) to comply with
or to perform in any material respect any covenant set forth in the
Guaranty, Guarantor (or any Person by, through or
23
on behalf of Guarantor) shall contest in any manner the validity,
binding nature or enforceability of the Guaranty, or the Guaranty shall
cease to be in full force and effect.
8.1.8 INVALIDITY OF PLEDGE AGREEMENT, ETC. The Pledge
Agreement shall cease to be in full force and effect, any party thereto
(other than Lender) shall fail (subject to any applicable notice, cure
or grace period) to comply with or to perform in any material respect
any applicable provision of the Pledge Agreement promptly upon request
of the Lender (or, if such noncompliance or nonperformance would result
in the non-perfection of a material portion of the Collateral granted
to the Lender under the Pledge Agreement, at any time regardless of
whether the Lender has made any such request), or any Person (other
than the Lender) party to the Pledge Agreement (or any Person by,
through or on behalf of such Person party thereto) shall contest in any
manner the validity, binding nature of enforceability of the Pledge
Agreement, as applicable.
8.1.9 AMENDMENT OF PGRT REGISTRATION STATEMENT OR PROSPECTUS.
The PGRT Registration Statement or the Prospectus is amended or
supplemented in any manner that would result in a Material Adverse
Effect.
8.1.10 CURRENT PROSPECTUS. The Borrower is notified by PGRT
that the Prospectus no longer meets the requirements of Section 12(2)
or 17 of the Securities Act of 1933, as amended, and PGRT does not file
an amendment or supplement to the Prospectus to cause the Prospectus to
meet such requirements within thirty (30) days after the date PGRT
receives notice of the failure of the Prospectus to meet such
requirements.
8.2 ACCELERATION OF BORROWER'S OBLIGATIONS. Upon the occurrence of:
(a) any Event of Default described in clauses (ii), (iii),
(iv) and (v) of subsection 8.1.5(a) or described in Section 8.1.5(b),
all of Borrower's Obligations at that time outstanding automatically
shall mature and become due and payable and Borrower's right to request
additional Revolver Advances shall immediately terminate, or
(b) any other Event of Default, Lender, at any time, (unless
such Event of Default shall have been cured by Borrower or waived by
Lender) at its option, may declare all of Borrower's Obligations due
and payable, whereupon Borrower's Obligations immediately shall mature
and become due and payable and Borrower's right to request additional
Revolver Advances shall immediately terminate,
all without presentment, demand, protest, or notice, all of which hereby are
waived.
8.3 REMEDIES ON DEFAULT. If any of Borrower's Obligations have been
accelerated pursuant to Section 8.2, Lender, at its option, may:
24
8.3.1 ENFORCEMENT OF SECURITY INTERESTS. Enforce its rights
and remedies under the Loan Documents in accordance with their
respective terms.
8.3.2 OTHER REMEDIES. Enforce any of the rights or remedies
granted to Lender under any other Loan Document and any other rights or
remedies accorded to Lender at equity or law, by virtue of statute or
otherwise.
8.4 APPLICATION OF FUNDS. Any funds received by Lender pursuant to the
exercise of any rights accorded to Lender pursuant to, or by the operation of
any of the terms of, any of the Loan Documents, including, without limitation,
insurance proceeds, condemnation proceeds or proceeds from the sale of
Collateral, shall be applied by Lender in the following order of priority:
8.4.1 EXPENSES. First, to the payment of (i) all fees and
expenses, including, without limitation, reasonable attorney's fees,
court costs, fees of appraisers, title charges, costs of maintaining
and preserving the Collateral, costs of sale, and all other costs
incurred by the Lender in exercising any rights accorded to the Lender
pursuant to the Loan Documents or by applicable law and (ii) all Liens
superior to the Liens of Lender, except such superior Liens subject to
which any sale of the Collateral may have been made;
8.4.2 BORROWER'S OBLIGATIONS. Next to the payment of
Borrower's Obligations in such order as Lender may determine; and
8.4.3 SURPLUS. Any surplus, to the Person or Persons entitled
thereto.
ARTICLE 9
CLOSING
The closing of the Loan (the "Closing") shall be on the date hereof
(the "Closing Date"), and the Closing shall take place on such date provided all
conditions for the Closing as set forth in this Loan Agreement have been
satisfied. The Closing shall occur at such place as the parties hereto shall
agree.
ARTICLE 10
EXPENSES AND INDEMNITY
10.1 CLOSING FEE. The Borrower shall pay to Lender on the Closing Date
hereof the sum of $23,000, which may be paid out of Borrower's initial borrowing
under the Loan.
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10.2 ATTORNEY'S FEES AND OTHER FEES AND EXPENSES. Whether or not any of
the transactions contemplated by this Loan Agreement shall be consummated,
Borrower agrees to pay to Lender on demand all fees paid or expenses incurred by
Lender in connection with the transactions contemplated hereby and in connection
with any amendments, modifications or waivers (whether or not the same become
effective) under or in respect of any of the Loan Documents, including, without
limitation:
10.2.1 FEES AND EXPENSES FOR PREPARATION OF LOAN DOCUMENTS.
All reasonable fees, expenses and disbursements (including without
limitation, charges for required lien searches, reproduction of
documents, long distance telephone calls and overnight express
carriers) of counsel retained by Lender in connection with the
preparation and negotiation of any of the Loan Documents or any
amendments, modifications or waivers hereto or thereto (whether or not
the same become effective).
10.2.2 FEES AND EXPENSES IN ENFORCEMENT OF RIGHTS OR DEFENSE
OF LOAN DOCUMENTS. Any reasonable attorneys' fees and expenses or other
costs or expenses incurred by Lender in connection with the enforcement
or collection against Borrower or Guarantor of any provision of any of
the Loan Documents, and in connection with or arising out of any
litigation, investigation or proceeding instituted by any Governmental
Body or any other Person with respect to any of the Loan Documents,
whether or not suit is instituted, including, but not limited to, such
costs or expenses arising from the enforcement or collection against
Borrower, of any provision of any of the Loan Documents in any state or
federal bankruptcy or reorganization proceeding.
10.3 INDEMNITY. Borrower hereby agrees to indemnify and save Lender
harmless from the following:
10.3.1 BROKERAGE FEES. The fees, if any, of brokers and
finders incurred by Borrower.
10.3.2 OPERATION OF COLLATERAL; JOINT VENTURERS. Any loss,
cost, liability, damage or expense (including reasonable attorneys'
fees and expenses) incurred in connection with the ownership, operation
or maintenance of the Collateral, the construction of Lender and
Borrower as having the relationship of joint venturers or partners or
the determination that Lender or Borrower has acted as agent for the
other.
10.4 EXTENSION FEE. If Borrower shall request, and Lender shall agree,
to extend the Maturity Date of the Loan for an additional 12-month period, then
Borrower shall pay Lender an extension fee of $8,050. Borrower shall pay the
extension fee within five (5) Business Days of the date of Borrower's written
request pursuant to Section 2.4.
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ARTICLE 11
MISCELLANEOUS
11.1 NOTICES. Any notices, communications and waivers under this Loan
Agreement shall be in writing and shall be (i) delivered in person, (ii) mailed,
postage prepaid, either by registered or certified mail, return receipt
requested, (iii) by overnight express carrier, or (iv) by facsimile
transmission, addressed in each case as follows:
To Lender: LaSalle Bank National Association
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxx Xxxxxx
Facsimile No.: (000)000-0000
With copy to: Schwartz, Cooper, Xxxxxxxxxxx & Xxxxxx
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
To Borrower: Prime Group VI, L.P.
c/o The Prime Group, Inc.
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
Facsimile No.: (000)000-0000
With copies to: Winston & Xxxxxx
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx, Esq.
Facsimile No.: (000)000-0000
And to: The Prime Group, Inc.
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx, Esq.
Facsimile No.: (000)000-0000
27
or to any other address as to any of the parties hereto, as such party shall
designate in a written notice to the other party hereto. All notices sent
pursuant to the terms of this Section shall be deemed received (i) if personally
delivered, then on the date of delivery, (ii) if sent by overnight, express
carrier, then on the next Business Day immediately following the day sent, (iii)
if sent by registered or certified mail, then on the earlier of the third
Business Day following the day sent or when actually received, or (iv) if sent
by facsimile transmission, when transmitted to the facsimile number specified in
this Section, provided confirmation of receipt is received by 5:00 PM Chicago
time, otherwise on the next Business Day after confirmation of receipt is
received.
11.2 SURVIVAL OF LOAN AGREEMENT. All covenants, agreements,
representations and warranties made in this Loan Agreement and in the
certificates delivered pursuant hereto shall survive the making by Lender of the
Loan and the execution and delivery to Lender of the Note and of all other Loan
Documents and shall continue in full force and effect so long as any of
Borrower's Obligations remain outstanding, unperformed or unpaid.
11.3 FURTHER ASSURANCE. From time to time, Borrower shall execute and
deliver to Lender such additional documents as Lender may require to carry out
the purposes of the Loan Documents and to protect Lender's rights thereunder.
11.4 TAXES AND FEES. Should any tax (other than taxes based upon the
net income of Lender), recording or filing fees become payable in respect of any
of the Loan Documents, or any amendment, modification or supplement thereto,
Borrower agrees to pay the same to Lender promptly after demand, but in no event
after 15 Business Days from the date of demand, together with any interest or
penalties thereon and agrees to hold Lender harmless with respect thereto.
11.5 SEVERABILITY. In the event that any provision of this Loan
Agreement is deemed to be invalid by reason of the operation of law, or by
reason of the interpretation placed thereon by any administrative agency or any
court, this Loan Agreement shall be construed as not containing such provision,
and the invalidity of such provision shall not affect the validity of any other
provisions hereof, and any and all other provisions hereof which otherwise are
lawful and valid shall remain in full force and effect.
11.6 WAIVER. No delay on the part of Lender in exercising any right,
power or privilege hereunder shall operate as a waiver thereof, and no single or
partial exercise of any right, power or privilege hereunder shall preclude other
or further exercise thereof, or be deemed to establish a custom or course of
dealing or performance between the parties hereto, or preclude the exercise of
any other right, power or privilege.
11.7 MODIFICATION OF LOAN DOCUMENTS. No modification or waiver of any
provision of any of the Loan Documents shall be effective unless the same shall
be in writing, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. No notice to or demand on
Borrower in any case shall entitle Borrower to any other or further notice or
demand in the same, similar or other circumstances.
28
11.8 CAPTIONS. The headings in this Loan Agreement are for purposes of
reference only and shall not limit or otherwise affect the meaning hereof.
11.9 SALE OF INTEREST. Borrower may not sell, assign or transfer this
Loan Agreement or any portion thereof, including, without limitation, Borrower's
right, title, interest, remedies, powers, and/or duties hereunder or thereunder.
Borrower hereby consents to Lender's sale, assignment, transfer or other
disposition of this Loan Agreement or of any portion hereof or thereof, at any
time or times after an Event of Default has occurred, including, without
limitation, Lender's right, title, interest, remedies, powers, and/or duties
hereunder or thereunder. Borrower hereby consents to Lender's participation of
this Loan Agreement at any time prior to an Event of Default so long as Lender
retains at least a 50% participating interest in this Loan Agreement. Borrower
acknowledges and agrees that any and all such assignees or participants may be
provided with information concerning Borrower, its operations, business and
financial condition and this Loan Agreement which have been or would be provided
to Lender.
11.10 SUCCESSORS AND ASSIGNS. This Loan Agreement shall be binding upon
and inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns.
11.11 REMEDIES CUMULATIVE. All rights and remedies of Lender pursuant
to this Loan Agreement, any other Loan Documents or otherwise, shall be
cumulative and non-exclusive, and may be exercised singularly or concurrently.
One or more successive actions may be brought against Borrower as often as
Lender deems advisable, until all of Borrower's Obligations are paid and
performed in full.
11.12 ENTIRE AGREEMENT. This Loan Agreement and the other Loan
Documents executed prior or pursuant hereto constitute the entire agreement
between the parties hereto with respect to the transactions contemplated hereby
or thereby and supersede any prior agreements, whether written or oral, relating
to the subject matter hereof.
11.13 APPLICABLE LAW. THE LOAN DOCUMENTS SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS AND DECISIONS OF THE STATE OF ILLINOIS
(OTHER THAN CHOICE OF LAW PROVISIONS), UNLESS OTHERWISE PROVIDED THEREIN.
11.14 JURISDICTION AND VENUE. BORROWER HEREBY AGREES THAT ALL ACTIONS
OR PROCEEDINGS INITIATED BY BORROWER AND ARISING DIRECTLY OR INDIRECTLY OUT OF
THE LOAN DOCUMENTS SHALL BE LITIGATED IN THE CIRCUIT COURT OF XXXX COUNTY,
ILLINOIS, OR THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF
ILLINOIS OR, IF LENDER INITIATES SUCH ACTION, ANY COURT IN WHICH LENDER SHALL
INITIATE SUCH ACTION, TO THE EXTENT SUCH COURT HAS JURISDICTION. BORROWER HEREBY
EXPRESSLY SUBMITS AND CONSENTS IN
29
ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED BY LENDER IN
ANY OF SUCH COURTS. BORROWER WAIVES ANY CLAIM THAT CHICAGO, ILLINOIS OR THE
NORTHERN DISTRICT OF ILLINOIS IS AN INCONVENIENT FORUM OR AN IMPROPER FORUM
BASED ON LACK OF VENUE. THE EXCLUSIVE CHOICE OF FORUM FOR BORROWER SET FORTH IN
THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE ENFORCEMENT, BY LENDER, OF ANY
JUDGMENT OBTAINED IN ANY OTHER FORUM OR THE TAKING, BY LENDER, OF ANY ACTION TO
ENFORCE THE SAME IN ANY OTHER APPROPRIATE JURISDICTION.
11.15 WAIVER OF RIGHT TO JURY TRIAL. LENDER AND BORROWER ACKNOWLEDGE
AND AGREE THAT ANY CONTROVERSY WHICH MAY ARISE UNDER ANY OF THE LOAN DOCUMENTS
OR WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED THEREBY WOULD BE BASED UPON
DIFFICULT AND COMPLEX ISSUES AND THEREFORE, THE PARTIES AGREE THAT ANY COURT
PROCEEDING ARISING OUT OF ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT OF
COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
11.16 NON-RECOURSE. Notwithstanding anything to the contrary contained
herein, Lender agrees that no limited partner, agent, director, officer or
employee of Borrower shall be personally liable to Lender for the payment of the
Loan or performance of any of Borrower's Obligations or any other obligations
hereunder, under the Note or under any of the other Loan Documents, or with
respect to the Loan, and recourse hereunder, under the Note and under any other
Loan Documents (including, without limitation, with respect to the
representations and warranties contained herein or therein) shall be limited to
the Collateral. It is understood that the preceding sentence shall not (i) in
the event of any malfeasance, such as fraud, misappropriation of funds or
intentional misrepresentation, estop Lender from instituting or prosecuting a
legal action or proceeding or otherwise making a claim against the Person or
Persons committing such malfeasance, or (ii) constitute a waiver, release or
discharge of any of Borrower's Obligations, and the same shall continue until
paid or discharged in full.
[BALANCE OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS.]
30
This Loan Agreement has been executed and delivered by each of the
parties hereto by a duly authorized officer of each such party on the date first
set forth above.
PRIME GROUP VI, L.P., an Illinois limited partnership
By: PGLP, Inc., an Illinois corporation, as managing
general partner
By: ____________________________________________________
Name: __________________________________________________
Title: _________________________________________________
LASALLE BANK NATIONAL ASSOCIATION , a
national banking association
By: ____________________________________________________
Name: __________________________________________________
Title: _________________________________________________
EXHIBIT A
FORM OF GUARANTY
EXHIBIT B
FORM OF NOTE
EXHIBIT C
FORM OF PLEDGE AGREEMENT
TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS AND DETERMINATIONS..........................................................1
1.1 Definitions....................................................................1
1.2 Time Periods...................................................................6
1.3 Accounting Terms...............................................................6
1.4 References.....................................................................7
1.5 Lender's Discretion............................................................7
1.6 Borrower's Knowledge...........................................................7
1.7 Market Price Adjustments.......................................................7
ARTICLE 2
LOAN AND TERMS OF PAYMENT...............................................................7
2.1 Revolving Loan.................................................................7
2.1.1 Amount.........................................................................7
2.1.2 Procedure for Borrowing........................................................7
2.2 Disbursement of Loan on Closing Date...........................................8
2.3 Interest.......................................................................8
2.3.1 Interest Rate..................................................................8
2.3.2 Interest Payments..............................................................8
2.3.3 Interest Computation...........................................................8
2.3.4 Maximum Interest...............................................................8
2.4 Principal Payments; Maturity...................................................9
2.5 Prepayment.....................................................................9
2.5.1 Voluntary Prepayment...........................................................9
2.5.2 Mandatory Prepayment...........................................................9
2.6 LIBOR Option...................................................................9
2.6.1 Option.........................................................................9
2.6.2 Notice Procedure..............................................................10
2.6.3 Notice Irrevocable............................................................10
2.6.4 Failure to Provide Notice of Continuation.....................................10
2.7 Interest Periods..............................................................10
2.8 Special Provisions Governing LIBOR Loans......................................11
2.8.1 Determination of Interest Rate................................................11
2.8.2 Interest Rate Unascertainable, Inadequate or Unfair...........................11
2.9 Illegality....................................................................11
2.10 Compensation..................................................................12
2.11 LIBOR Rate Taxes..............................................................12
2.11.1 Additional Payments...........................................................12
2.11.2 Indemnity.....................................................................12
2.12 Default Rate..................................................................12
2.13 Method of Payment; Good Funds.................................................13
2.14 Deposit to Borrower's Account.................................................13
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ARTICLE 3
NOTE AND SECURITY......................................................................13
3.1 Note..........................................................................13
3.2 Security......................................................................13
ARTICLE 4
CONDITIONS OF FUNDING..................................................................13
4.1 Initial Advance...............................................................13
4.2 All Revolver Advances.........................................................15
4.2.1 Representations and Warranties................................................15
4.2.2 Performance; No Default.......................................................15
ARTICLE 5
REPRESENTATIONS AND WARRANTIES.........................................................16
5.1 Borrower......................................................................16
5.2 Partners of Borrower..........................................................16
5.3 Authority.....................................................................16
5.4 Necessary Assets..............................................................16
5.5 Binding Agreements............................................................16
5.6 Borrower's Securities.........................................................16
5.7 Title to Property; Liens......................................................16
5.8 Financial Statements..........................................................17
5.9 Litigation....................................................................17
5.10 Conflicting Agreements........................................................17
5.11 Compliance with Applicable Laws...............................................17
5.12 Application of Certain Laws and Regulations...................................17
5.12.1 Investment Company Act........................................................18
5.12.2 Holding Company Act...........................................................18
5.13 Margin Regulations............................................................18
5.14 No Misrepresentation..........................................................18
5.15 Registration Effective........................................................18
ARTICLE 6
AFFIRMATIVE COVENANTS..................................................................18
6.1 Legal Existence; Good Standing................................................18
6.2 Inspection....................................................................19
6.3 Financial Statements and Other Information of Borrower........................19
6.3.1 Annual Statements.............................................................19
6.3.2 Notice of Defaults; Loss......................................................19
6.3.3 Notice of Suits, Adverse Events...............................................20
6.3.4 Covenant Compliance Certificate; Borrowing Base Certificate...................20
6.3.5 Other Information.............................................................20
6.4 INTENTIONALLY OMITTED.........................................................20
6.5 Reports to Governmental Bodies and Other Persons..............................20
6.6 General Partner...............................................................21
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6.7 Financial Statements of Guarantor.............................................21
6.8 Minimum Interest Coverage Ratio...............................................21
ARTICLE 7
NEGATIVE COVENANTS.....................................................................21
ARTICLE 8
DEFAULT AND REMEDIES...................................................................22
8.1 Events of Default.............................................................22
8.1.1 Default in Payment............................................................22
8.1.2 Breach of Covenants and Certain Other Provisions..............................22
8.1.3 Breach of Warranty............................................................22
8.1.4 Acceleration of any Indebtedness..............................................22
8.1.5 Bankruptcy....................................................................23
8.1.6 Judgments.....................................................................23
8.1.7 Non-Performance of Guaranty, Etc..............................................23
8.1.8 Invalidity of Pledge Agreement, Etc...........................................24
8.1.9 Amendment of PGRT Registration Statement or Prospectus........................24
8.2 Acceleration of Borrower's Obligations........................................24
8.3 Remedies on Default...........................................................24
8.3.1 Enforcement of Security Interests.............................................25
8.3.2 Other Remedies................................................................25
8.4 Application of Funds..........................................................25
8.4.1 Expenses......................................................................25
8.4.2 Borrower's Obligations........................................................25
8.4.3 Surplus.......................................................................25
ARTICLE 9
CLOSING................................................................................25
ARTICLE 10
EXPENSES AND INDEMNITY.................................................................25
10.1 Closing Fee...................................................................25
10.2 Attorney's Fees and Other Fees and Expenses...................................26
10.2.1 Fees and Expenses for Preparation of Loan Documents...........................26
10.2.2 Fees and Expenses in Enforcement of Rights or Defense of Loan Documents.......26
10.3 Indemnity.....................................................................26
10.3.1 Brokerage Fees................................................................26
10.3.2 Operation of Collateral; Joint Venturers......................................26
10.4 Extension Fee.................................................................26
ARTICLE 11
MISCELLANEOUS..........................................................................27
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11.1 Notices.......................................................................27
11.2 Survival of Loan Agreement....................................................28
11.3 Further Assurance.............................................................28
11.4 Taxes and Fees................................................................28
11.5 Severability..................................................................28
11.6 Waiver........................................................................28
11.7 Modification of Loan Documents................................................28
11.8 Captions......................................................................29
11.9 Sale of Interest..............................................................29
11.10 Successors and Assigns........................................................29
11.11 Remedies Cumulative...........................................................29
11.12 Entire Agreement..............................................................29
11.13 APPLICABLE LAW................................................................29
11.14 JURISDICTION AND VENUE........................................................29
11.15 WAIVER OF RIGHT TO JURY TRIAL.................................................30
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LOAN AGREEMENT
BETWEEN
PRIME GROUP VI, L.P.,
an Illinois limited partnership
AND
LASALLE BANK NATIONAL ASSOCIATION,
a national banking association
