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AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
dated as of August 23, 1996
among
CARRAMERICA REALTY CORPORATION,
XXXX REALTY, L.P.,
CARRAMERICA REALTY, L.P.,
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Bank and as Lead Agent for the Banks,
COMMERZBANK AKTIENGESELLSCHAFT, NEW YORK BRANCH,
as Bank and as Co-Agent for the Banks,
NATIONSBANK, N.A.
as Bank and as Co-Agent for the Banks,
XXXXX FARGO REALTY ADVISORS FUNDING, INCORPORATED,
as Bank and as Co-Agent for the Banks,
and
THE BANKS LISTED HEREIN
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AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT, dated as of
August 23, 1996, among CARRAMERICA REALTY CORPORATION ("Xxxx"), XXXX REALTY,
L.P. ("Xxxx XX"; Xxxx and Xxxx XX each, a "Borrower" and collectively, the
"Borrowers"), CARRAMERICA REALTY, L.P. ("CarrAmerica LP"), XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK, as Bank and as Lead Agent for the Banks, COMMERZBANK
AKTIENGESELLSCHAFT, NEW YORK BRANCH, as Bank and as Co-Agent for the Banks,
NATIONSBANK, N.A., as Bank and as Co-Agent for the Banks, XXXXX FARGO REALTY
ADVISORS FUNDING, INCORPORATED, as Bank and as Co-Agent for the Banks, and the
BANKS listed on the signature pages hereof (the "Banks").
W I T N E S S E T H:
WHEREAS, the Borrowers and Lead Agent entered into the Revolving
Credit Agreement, dated as of May 23, 1996 (the "Existing Credit Agreement");
and
WHEREAS, the parties hereto have agreed to amend and restate the
terms and conditions contained in the Existing Credit Agreement in their
entirety as hereinafter set forth.
NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
I. The Existing Credit Agreement is hereby modified so that all
of the terms and conditions of the aforesaid Existing Credit Agreement shall be
restated in their entirety as set forth herein, and the Borrowers and
CarrAmerica LP agree to comply with and be subject to all of the terms,
covenants and conditions of this Agreement.
II. This Agreement shall be binding upon and inure to the
benefit of the parties hereto, and their respective successors and assigns, and
shall be deemed to be effective as of the date hereof.
III. Any reference in the Notes, any other Loan Document or any
other document executed in connection with this Agreement to the Existing Credit
Agreement shall be deemed to refer to this Agreement.
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. The following terms, as used herein,
have the following meanings:
"Adjusted London Interbank Offered Rate" has the meaning set
forth in Section 2.6(b).
"Administrative Questionnaire" means, with respect to each Bank,
an administrative questionnaire in the form prepared by the Lead Agent and
submitted to the Lead Agent (with a copy to the Borrowers) duly completed by
such Bank.
"Agreement" means this Revolving Credit Agreement as the same
may from time to time hereafter be modified, supplemented or amended.
"Allocated Xxxx Borrowing Base Property Loan Amount" means as to
any Xxxx Borrowing Base Property, an amount equal to the product from time to
time of (x) the outstanding principal balance of the Tranche A Loans at the time
in question, and (y) a fraction, the numerator of which is the amount (the "Xxxx
Numerator Amount") indicated next to such Xxxx Borrowing Base Property listed on
Exhibit B-1 attached hereto and made a part hereof and such other amounts
hereafter determined as hereinafter set forth upon the addition of any New
Acquisition or Real Property
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Asset to the Xxxx Borrowing Base Properties, and the denominator of which is the
aggregate of the Xxxx Numerator Amounts with respect to all the Xxxx Borrowing
Base Properties at the time in question. Effective upon the release of any Xxxx
Borrowing Base Property in accordance with the terms of this Agreement,
"Allocated Xxxx Borrowing Base Property Loan Amount" shall no longer be deemed
to include the amount corresponding to such released Xxxx Borrowing Base
Property. Upon the addition of any New Acquisition or Real Property Asset to the
Xxxx Borrowing Base Properties, the amount with respect thereto for purposes of
determining the numerator and the denominator in clause (y), shall be equal to
the purchase price thereof if the same shall have been purchased within one year
of such addition.
"Allocated Xxxx XX Borrowing Base Property Loan Amount" means as
to any Xxxx XX Borrowing Base Property, an amount equal to the product from time
to time of (x) the outstanding principal balance of the Tranche B Loans at the
time in question, and (y) a fraction, the numera- tor of which is the amount
(the "Xxxx XX Numerator Amount") indicated next to such Xxxx XX Borrowing Base
Property listed on Exhibit B-2 attached hereto and made a part hereof and such
other amounts hereafter determined as hereinafter set forth upon the addition of
any New Acquisition or Real Property Asset to the Xxxx XX Borrowing Base
Properties, and the denominator of which is the aggregate of the Xxxx XX
Numerator Amounts with respect to all the Xxxx XX Borrowing Base Properties at
the time in question. Effective upon the release of any Xxxx XX Borrowing Base
Property in accordance with the terms of this Agreement, "Allocated Xxxx XX
Borrowing Base Property Loan Amount" shall no longer be deemed to include the
amount corresponding to such released Xxxx XX Borrowing Base Property. Upon the
addition of any New Acquisition or Real Property Asset to the Xxxx XX Borrowing
Base Properties, the amount with respect thereto for purposes of determining the
numerator and the denominator in clause (y), shall be equal to the purchase
price thereof if the same shall have been purchased within one year of such
addition.
"Annual EBITDA" means, measured as of the last day of each
calendar quarter, an amount derived from (i) total revenues relating to all Real
Property Assets of the Borrowers and their Consolidated Subsidiaries or to the
Borrowers' interest in Minority Holdings for the previous four consecutive
calendar quarters including the quarter then ended, on a cash basis, plus (ii)
interest and other income of the Borrowers and their Consolidated Subsidiaries,
including, without limitation, real estate service revenues, for such period,
less (iii) total operating expenses and other expenses relating to such Real
Property Assets and to the Borrowers' interest in Minority Holdings for such
period (other than interest, taxes,
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depreciation, amortization, and other non-cash items), less (iv) total corporate
operating expenses (including general overhead expenses) and other expenses of
the Borrowers, their Consolidated Subsidiaries and the Borrowers' interest in
Minority Holdings (other than interest, taxes, depreciation, amortization and
other non-cash items), for such period.
"Applicable Interest Rate" means the lesser of (x) the rate at
which the interest rate applicable to any floating rate Indebtedness could be
fixed, at the time of calculation, by the applicable Borrower entering into an
unsecured interest rate swap agreement (or, if such rate is incapable of being
fixed by entering into an unsecured interest rate swap agreement at the time of
calculation, a reasonably determined fixed rate equivalent), and (y) the rate at
which the interest rate applicable to such floating rate Indebtedness is
actually capped, at the time of calculation, if such Borrower has entered into
an interest rate cap agreement with respect thereto.
"Applicable Lending Office" means, with respect to any Bank, (i)
in the case of its Base Rate Loans, its Domestic Lending Office and (ii) in the
case of its Euro-Dollar Loans, its Euro-Dollar Lending Office.
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"Applicable Margin" means, with respect to each Loan, the
respective percentages per annum determined, at any time from and after the
receipt by Xxxx of two (2) Investment Grade Ratings, based on the range into
which the rating or "shadow" rating on Xxxx'x senior long-term unsecured debt
then falls, in accordance with the following table. Any change in Xxxx'x
Investment Grade Rating causing it to move to a different range on the table
shall effect an immediate change in the Applicable Margin. In the event that
Xxxx receives two (2) Investment Grade Ratings that are not equivalent, the
Applicable Margin shall be determined by the lower of such two (2) Investment
Grade Ratings, at least one of which shall be an Investment Grade Rating from
S&P or Xxxxx'x. In the event Xxxx receives more than two (2) ratings (from S&P,
Xxxxx'x, Duff & Xxxxxx or Fitch) and such ratings are not equivalent, the
Applicable Margin shall be determined by the lower of the two highest ratings;
provided that each of said two (2) highest ratings shall be Investment Grade
Ratings and at least one of which shall be an Investment Grade Rating from S&P
or Xxxxx'x.
Range of Applicable
Xxxx'x Margin for Applicable
Credit Rating Base Rate Margin for Euro
(S&P/Xxxxx'x Loans Dollar Loans
Ratings) (% per annum) (% per annum)
-------- ------------- -------------
BBB-/Baa3 .125 1.625
BBB/Baa2 0 1.50
The Applicable Margin for so long as Xxxx shall not have
obtained two Investment Grade Ratings (at least one of which shall be from S&P
or Xxxxx'x) or after Borrower loses its Investment Grade Rating, shall be as
follows:
Applicable
Margin for Applicable
Base Rate Margin for Euro
Loans Dollar Loans
(% per annum) (% per annum)
------------- -------------
.25 1.75
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Lead Agent shall notify the Banks in writing promptly after it
obtains knowledge of any change in Xxxx'x Investment Grade Rating which shall
effect a change in the Applicable Margin.
"Assignee" has the meaning set forth in Section 9.6(c).
"Bank" means each bank listed on the signature pages hereof,
each Assignee which becomes a Bank pursuant to Section 9.6(c), and their
respective successors.
"Bankruptcy Code" means Title 11 of the United States Code,
entitled "Bankruptcy", as amended from time to time, and any successor statute
or statutes.
"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate for such day and (ii) the sum of of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means a Loan to be made by a Bank as a Base
Rate Loan in accordance with the applicable Notice of Borrowing or pursuant to
Article VIII.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means either (i) Xxxx and its successors or (ii) Xxxx
XX and its successors, and, collectively, "Borrowers" shall mean both Borrowers.
"Borrowers LTV Ratio" means the ratio, expressed as a percentage
and calculated on a quarterly basis by Xxxx, of the aggregate amount of the
Loans outstanding as of the date of determination, to the Borrowing Base
Properties Value as of the date of determination.
"Borrowing" means a borrowing hereunder consisting of Loans made
to the Borrowers or CarrAmerica LP at the same time by the Banks pursuant to
Article II. A Borrowing is a "Domestic Borrowing" if such Loans are Base Rate
Loans or a
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"Euro-Dollar Borrowing" if such Loans are Euro-Dollar Loans.
"Borrowing Base Net Operating Cash Flow" means as of any date of
determination with respect to the Borrowing Base Properties, Property Income for
the previous four consecutive quarters including the quarter then ended, but
less (x) Property Expenses with respect to the Borrowing Base Properties for the
previous four consecutive quarters including the quarter then ended and (y) the
greater of (i) Capital Expenditures which are not related to new construction
for the previous four consecutive quarters including the quarter then ended and
(ii) appropriate reserves for replacements of not less than $2.29 per square
foot per annum for each Borrowing Base Property. For purposes of Section 5.1(m)
hereof, the calculation of Borrowing Base Net Operating Cash Flow shall be made
separately as to each Borrowing Base Property.
"Borrowing Base Properties" means, as of any date, collectively
the Xxxx Borrowing Base Properties and the Xxxx XX Borrowing Base Properties.
"Borrowing Base Properties Minimum Debt Service Coverage" means
as of the last day of each calendar quarter, Borrowing Base Net Operating Cash
Flow equal to or greater than 200% of Pro-Forma Debt Service.
"Borrowing Base Properties Value" means the aggregate of (i) the
Xxxx Borrowing Base Properties Value and (ii) the Xxxx XX Borrowing Base
Properties Value.
"Capital Expenditures" means, for any period, the sum of all
expenditures (whether paid in cash or accrued as a liability) by Xxxx or Xxxx
XX, as applicable, which are capitalized on the consolidated balance sheet of
such Borrower in conformity with GAAP, but less all expenditures made with
respect to the acquisition by Xxxx or Xxxx XX and their Consolidated
Subsidiaries of any interest in real property within nine months after the date
such interest in real property is acquired.
"Xxxx Borrowing Base Properties" means, as of any date, the Real
Property Assets listed in Exhibit B-1 attached hereto and made a part hereof,
each of which is 100% owned in fee (or leasehold in the case of assets listed as
such on Exhibit B-1) by Xxxx or any Consolidated Subsidiary
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of Xxxx (other than Xxxx XX) and each of which is not subject to any Lien (other
than Permitted Liens), subject to adjustment as set forth herein, together with
all New Acquisitions or Real Property Assets which have become part of the Xxxx
Borrowing Base Properties as of such date in accordance with Section 3.3 and
excluding any Xxxx Borrowing Base Properties which have been released from this
Agreement and the other Loan Documents as of such date in accordance with
Sections 5.13 and 5.14 and all other terms of this Agreement.
"Xxxx Borrowing Base Properties Value" means the aggregate of
(i) with respect to the Xxxx Borrowing Base Properties acquired (A) on or before
January 1, 1996 or (B) after January 1, 1996 and such Xxxx Borrowing Base
Property has been owned by Xxxx or any of its Consolidated Subsidiaries for a
period of at least one year, the quotient of (x) Net Operating Income with
respect to the Xxxx Borrowing Base Properties less appropriate reserves for
replacements of not less than $.50 per square foot per annum for each Xxxx
Borrowing Base Property and (y) 11% and (ii) with respect to the Xxxx Borrowing
Base Properties acquired after January 1, 1996 and such Xxxx Borrowing Base
Property has been owned by Xxxx or any of its Consolidated Subsidiaries for a
period of less than one year, the lesser of (A) the quotient of (x) Net
Operating Income with respect to the Xxxx Borrowing Base Properties less
appropriate reserves for replacements of not less than $.50 per square foot per
annum for each Xxxx Borrowing Base Property and (y) 11% and (B) the purchase
price of such Xxxx Borrowing Base Property.
"Xxxx XX Borrowing Base Properties" means, as of any date, the
Real Property Assets listed in Exhibit B-2 attached hereto and made a part
hereof, each of which is 100% owned in fee (or leasehold in the case of assets
listed as such on Exhibit B-2) by Xxxx XX or any Consolidated Subsidiary of Xxxx
XX and each of which is not subject to any Lien (other than Permitted Liens),
subject to adjustment as set forth herein, together with all New Acquisitions or
Real Property Assets which have become part of the Xxxx XX Borrowing Base
Properties as of such date in accordance with Section 3.3 and excluding any Xxxx
XX Borrowing Base Properties which have been released from this Agreement and
the other Loan Documents as of such date in accordance with Sections 5.13 and
5.14 and all other terms of this Agreement.
"Xxxx XX Borrowing Base Properties Value" means the aggregate of
(i) with respect to the Xxxx XX Borrowing Base Properties acquired (A) on or
before January 1, 1996 or (B) after January 1, 1996 and such Xxxx XX Borrowing
Base Property has been owned by Xxxx XX or any of its Consolidated
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Subsidiaries for a period of at least one year, the quotient of (x) Net
Operating Income with respect to the Xxxx XX Borrowing Base Properties less
appropriate reserves for replacements of not less than $.50 per square foot per
annum for each Xxxx XX Borrowing Base Property and (y) 11% and (ii) with respect
to the Xxxx XX Borrowing Base Properties acquired after January 1, 1996 and such
Xxxx Borrowing Base Property has been owned by Xxxx or any of its Consolidated
Subsidiaries for a period of less than one year, the lesser of (A) the quotient
of (x) Net Operating Income with respect to the Xxxx XX Borrowing Base
Properties less appropriate reserves for replacements of not less than $.50 per
square foot per annum for each Xxxx XX Borrowing Base Property and (y) 11% and
(B) the purchase price of such Xxxx XX Borrowing Base Property.
"Xxxx XX LTV Ratio" means the ratio, expressed as a percentage
and calculated on a quarterly basis by Xxxx XX, of the aggregate amount of the
Tranche B Loans outstanding as of the date of determination, to the Xxxx XX
Borrowing Base Properties Value as of the date of determination.
"Xxxx XX Maximum Total Debt Ratio" means the ratio as of the
date of determination of (i) the sum of (x) the aggregate Debt of Xxxx XX and
its Consolidated Subsidiaries and (y) Xxxx LP's pro rata share of the Debt of
any Subsidiaries of Xxxx XX which are not Consolidated Subsidiaries, at the time
of determination to (ii) Xxxx XX Tangible FMV.
"Xxxx XX Tangible FMV" means the sum of (x) (i) with respect to
Real Property Assets owned by Xxxx XX or its Consolidated Subsidiaries for a
period of at least one year, the quotient of Net Operating Income with respect
to such Real Property Assets determined as of the last day of the previous
calendar quarter, as divided by the FMV Cap Rate, (ii) with respect to Real
Property Assets owned by Xxxx XX or its Consolidated Subsidiaries for a period
of less than six months, the purchase price of such Real Property Assets
and (iii) with respect to Real Property Assets owned by Xxxx XX or its
Consolidated Subsidiaries for a period of at least six months but less than one
year, the lesser of (A) the purchase price of such Real Property Assets or (B)
the quotient of Property Income attributable to such Real Property Assets
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for the period during which Xxxx XX or its Consolidated Subsidiaries owned such
Real Property Assets, but less Property Expenses attributable to such Real
Property Assets for the period during which Xxxx XX or its Consolidated
Subsidiaries owned such Real Property Assets on an annualized basis, as divided
by the FMV Cap Rate and (y) Cash or Cash Equivalents of Xxxx XX and its
Consolidated Subsidiaries as of the date of determination.
"Xxxx LTV Ratio" means the ratio, expressed as a percentage and
calculated on a quarterly basis by Xxxx, of the aggregate amount of the Tranche
A Loans outstanding as of the date of determination, to the Xxxx Borrowing Base
Properties Value as of the date of determination.
"Xxxx Maximum Total Debt Ratio" means the ratio as of the date
of determination of (i) the sum of (x) the aggregate Debt of Xxxx and its
Consolidated Subsidiaries (other than Xxxx XX) and (y) Xxxx'x pro rata share of
the Debt of any Subsidiaries of Xxxx which are not Consolidated Subsidiaries, at
the time of determination to (ii) Xxxx Tangible FMV.
"Xxxx Tangible FMV" means the sum of (x) (i) with respect to
Real Property Assets owned by Xxxx or its Consolidated Subsidiaries (other than
Xxxx XX) for a period of at least one year, the quotient of Net Operating Income
with respect to such Real Property Assets determined as of the last day of the
previous calendar quarter, as divided by the FMV Cap Rate, (ii) with respect to
Real Property Assets owned by Xxxx or its Consolidated Subsidiaries (other than
Xxxx XX) for a period of less than six months, the purchase price of such Real
Property Assets and (iii) with respect to Real Property Assets owned by Xxxx or
its Consolidated Subsidiaries (other than Xxxx XX) for a period of at least six
months but less than one year, the lesser of (A) the purchase price of such Real
Property Assets or (B) the quotient of Property Income attributable to such Real
Property Assets for the period during which Xxxx or its Consolidated
Subsidiaries (other than Xxxx XX) owned such Real Property Assets, but less
Property Expenses attributable to such Real Property Assets for the period
during which Xxxx or its Consolidated Subsidiaries (other than Xxxx XX) owned
such Real Property Assets, on an annualized basis, as divided by the FMV Cap
Rate and (y) Cash or Cash Equivalents of Xxxx and its Consolidated Subsidiaries
(other than Xxxx XX) as of the date of determination.
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"Cash or Cash Equivalents" means (i) cash, (ii) direct
obligations of the United States Government, including, without limitation,
treasury bills, notes and bonds, (iii) interest bearing or discounted
obligations of Federal agencies and Government sponsored entities or pools of
such instruments offered by banks rated AA or better by S&P or Aa2 by Xxxxx'x
and dealers, including, without limitation, Federal Home Loan Mortgage
Corporation participation sale certificates, Government National Mortgage
Association modified pass-through certificates, Federal National Mortgage
Association bonds and notes, Federal Farm Credit System securities, (iv) time
deposits, domestic and Eurodollar certificates of deposit, bankers acceptances,
commercial paper rated at least A-1 by S&P and P-1 by Xxxxx'x, and/or guaranteed
by an Aa rating by Xxxxx'x, an AA rating by S&P, or better rated credit,
floating rate notes, other money market instruments and letters of credit each
issued by banks which have a long-term debt rating of at least AA by S&P or Aa2
by Xxxxx'x, (v) obligations of domestic corporations, including, without
limitation, commercial paper, bonds, debentures, and loan participations, each
of which is rated at least AA by S&P, and/or Aa2 by Xxxxx'x, and/or
unconditionally guaranteed by an AA rating by S&P, an Aa2 rating by Xxxxx'x, or
better rated credit, (vi) obligations issued by states and local governments or
their agencies, rated at least MIG-1 by Xxxxx'x and/or SP-1 by S&P and/or
guaranteed by an irrevocable letter of credit of a bank with a long-term debt
rating of at least AA by S&P or Aa2 by Xxxxx'x, (vii) repurchase agreements with
major banks and primary government securities dealers fully secured by U.S.
Government or agency collateral equal to or exceeding the principal amount on a
daily basis and held in safekeeping, and (viii) real estate loan pool
participations, guaranteed by an entity with an AA rating given by S&P or an Aa2
rating given by Xxxxx'x, or better rated credit.
"Closing Date" means the date on which the Lead Agent shall have
received the documents specified in or pursuant to Section 3.1.
"Commitment" means, collectively, the Tranche A Commitment and
the Tranche B Commitment with respect to each Bank.
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"Consolidated Subsidiary" means at any date any Subsidiary or
other entity which is consolidated with either Borrower in accordance with GAAP.
"Consolidated Tangible Net Worth" means at any date the
consolidated stockholders' equity of Xxxx (determined on a book basis), less its
consolidated Intangible Assets, all determined as of such date. For purposes of
this definition "Intangible Assets" means with respect to any such intangible
assets, the amount (to the extent reflected in determining such consolidated
stockholders' equity) of all write-ups subsequent to December 31, 1995 in the
book value of any asset owned by either Borrower or a Consolidated Subsidiary
and (ii) goodwill, patents, trademarks, service marks, trade names, anticipated
future benefit of tax loss carry forwards, copyrights, organization or
developmental expenses and other intangible assets.
"Contingent Obligation" as to any Person means, without
duplication, (i) any contingent obligation of such Person required to be shown
on such Person's balance sheet in accordance with GAAP, and (ii) any obligation
required to be disclosed in the footnotes to such Person's financial statements,
guaranteeing partially or in whole any non-recourse Debt, lease, dividend or
other obligation, exclusive of contractual indemnities (including, without
limitation, any indemnity or price-adjustment provision relating to the purchase
or sale of securities or other assets) and guarantees of non-monetary
obligations (other than guarantees of completion) which have not yet been called
on or quantified, of such Person or of any other Person. The amount of any
Contingent Obligation described in clause (ii) shall be deemed to be (a) with
respect to a guaranty of interest or interest and principal, or operating income
guaranty, the sum of all payments required to be made thereunder (which in the
case of an operating income guaranty shall be deemed to be equal to the debt
service for the note secured thereby), calculated at the Applicable Interest
Rate, through (i) in the case of an interest or interest and principal guaranty,
the stated date of maturity of the obligation (and commencing on the date
interest could first be payable thereunder), or (ii) in the case of an operating
income guaranty, the date through which such guaranty will remain in effect, and
(b) with respect to all guarantees not covered by the preceding clause (a), an
amount equal to the stated or determinable amount of the primary obligation in
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respect of which such guaranty is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof (assuming such
Person is required to perform thereunder) as recorded on the balance sheet and
on the footnotes to the most recent financial statements of the applicable
Borrower required to be delivered pursuant to Section 4.6 hereof.
Notwithstanding anything contained herein to the contrary, guarantees of
completion shall not be deemed to be Contingent Obligations unless and until a
claim for payment or performance has been made thereunder, at which time any
such guaranty of completion shall be deemed to be a Contingent Obligation in an
amount equal to any such claim. Subject to the preceding sentence, (i) in the
case of a joint and several guaranty given by such Person and another Person
(but only to the extent such guaranty is recourse, directly or indirectly to the
applicable Borrower), the amount of the guaranty shall be deemed to be 100%
thereof unless and only to the extent that such other Person has delivered Cash
or Cash Equivalents to secure all or any part of such Person's guaranteed
obligations, (ii) in the case of joint and several guarantees given by a Person
in whom the applicable Borrower owns an interest (which guarantees are
non-recourse to the applicable Borrower), to the extent the guarantees, in the
aggregate, exceed 15% of total real estate investments, the amount in excess of
15% shall be deemed to be a Contingent Obligation of the applicable Borrower,
and (iii) in the case of a guaranty (whether or not joint and several) of an
obligation otherwise constituting Debt of such Person, the amount of such
guaranty shall be deemed to be only that amount in excess of the amount of the
obligation constituting Debt of such Person. Notwithstanding anything contained
herein to the contrary, "Contingent Obligations" shall not be deemed to include
guarantees of Unused Commitments or of construction loans to the extent the same
have not been drawn.
"Debt" of any Person means, without duplication, (A) as shown on
such Person's consolidated balance sheet (i) all indebtedness of such Person for
borrowed money or for the deferred purchase price of property and, (ii) all
indebtedness of such Person evidenced by a note, bond, debenture or similar
instrument (whether or not disbursed in full in the case of a construction
loan), (B) the face amount of all letters of credit issued for the account of
such Person and, without duplication, all unreimbursed amounts drawn
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thereunder, (C) all Contingent Obligations of such Person, (D) all payment
obligations of such Person under any interest rate protection agreement
(including, without limitation, any interest rate swaps, caps, floors, collars
and similar agreements) and currency swaps and similar agreements which were not
entered into specifically in connection with Debt set forth in clauses (A), (B)
or (C) hereof. For purposes of this Agreement, Debt (other than Contingent
Obligations) of the applicable Borrower shall be deemed to include only the
applicable Borrower's pro rata share (such share being based upon the applicable
Borrower's percentage ownership interest as shown on the applicable Borrower's
annual audited financial statements) of the Debt of any Person in which the
applicable Borrower, directly or indirectly, owns an interest, provided that
such Debt is nonrecourse, both directly and indirectly, to the applicable
Borrower.
"Debt Service" shall mean, measured as of the last day of each
calendar quarter, an amount equal to the sum of (i) interest (whether accrued,
paid or capitalized) actually payable by either Borrower or the Borrowers on its
Debt for the previous four consecutive quarters including the quarter then
ended, plus (ii) scheduled payments of principal on such Debt, whether or not
paid by either Borrower or the Borrowers (excluding balloon payments) for the
previous four consecutive quarters including the quarter then ended.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or both
would, unless cured or waived, become an Event of Default.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in New York City are authorized by law to
close.
"Domestic Lending Office" means, as to each Bank, its office
located within the United States at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its Domestic
Lending Office) or such other office within the United States as such Bank may
hereafter designate as its Domestic Lending Office by notice to the Borrowers
and the Lead Agent.
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"Due Diligence Package" has the meaning provided in Section 3.3.
"Duff & Xxxxxx" means Duff & Xxxxxx Credit Rating Co. or any
successor thereto.
"Environmental Affiliate" means any partnership, or joint
venture, trust or corporation in which an equity interest is owned by either
Borrower or CarrAmerica LP, either directly or indirectly.
"Environmental Approvals" means any permit, license, approval,
ruling, variance, exemption or other authorization required under applicable
Environmental Laws.
"Environmental Claim" means, with respect to any Person, any
notice, claim, demand or similar communication (written or oral) by any other
Person alleging potential liability for investigatory costs, cleanup costs,
governmental response costs, natural resources damage, property damages,
personal injuries, fines or penalties arising out of, based on or resulting from
(i) the presence, or release into the environment, of any Material of
Environmental Concern at any location, whether or not owned by such Person or
(ii) circumstances forming the basis of any violation, or alleged violation, of
any Environmental Law, in each case as to which there is a reasonable likelihood
of an adverse determination with respect thereto and which, if adversely
determined, would have a Material Adverse Effect.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating to
the environment, the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Substances or
hazardous wastes into the environment including, without limitation, ambient
air, surface water, ground water, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, Hazardous Substances or
hazardous wastes or the clean-up or other remediation thereof.
15
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, or any successor statute.
"ERISA Group" means the Borrowers, any Subsidiary and all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with the
Borrowers or any Subsidiary, are treated as a single employer under Section 414
of the Internal Revenue Code.
"Euro-Dollar Borrowing" has the meaning set forth in Section
1.3.
"Euro-Dollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including dealings
in dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Euro-Dollar Lending Office by notice
to the Borrowers and the Lead Agent.
"Euro-Dollar Loan" means a Loan to be made by a Bank as a
Euro-Dollar Loan in accordance with the applicable Notice of Borrowing.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.6(b).
"Event of Default" has the meaning set forth in Section 6.1.
"Extension Date" has the meaning set forth in Section 2.8.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New
16
York on the Domestic Business Day next succeeding such day, provided that (i) if
such day is not a Domestic Business Day, the Federal Funds Rate for such day
shall be such rate on such transactions on the next preceding Domestic Business
Day as so published on the next succeeding Domestic Business Day, and (ii) if no
such rate is so published on such next succeeding Domestic Business Day, the
Federal Funds Rate for such day shall be the average rate quoted to Xxxxxx
Guaranty Trust Company of New York on such day on such transactions as
determined by the Lead Agent.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System as constituted from time to time.
"FFO" means "funds from operations," defined to mean net income
(loss) (computed in accordance with GAAP), excluding gains (or losses) from debt
restructurings and sales of properties, plus depreciation and amortization,
after adjustments for Minority Holdings. Adjustments for Minority Holdings will
be calculated to reflect FFO on the same basis.
"Fitch" means Fitch Investors Services, L.P. or any successor
thereto.
"FMV Cap Rate" means, prior to the Extension Date, 11% and from
and after the Extension Date, at the rate at which Lead Agent shall determine,
in its sole discretion, to be the market capitalization rate.
"Fronting Bank" shall mean Xxxxxx or such other Bank which
Borrower is notified by the Lead Agent may be a Fronting Bank and which is
designated by Borrower in its Notice of Borrowing as the Bank which shall issue
a Letter of Credit with respect to such Notice of Borrowing.
"GAAP" means generally accepted accounting principles recognized
as such in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and Board or in such
other statements by such other entity as may be approved by a significant
segment of the accounting profession, which are applicable to the circumstances
as of the date of determination.
17
"Group of Loans" means, at any time, a group of Loans consisting
of (i) all Loans which are Base Rate Loans at such time, or (ii) all Loans which
are Euro-Dollar Loans having the same Interest Period at such time; provided
that, if a Loan of any particular Bank is converted to or made as a Base Rate
Loan pursuant to Section 8.2 or 8.4, such Loan shall be included in the same
Group or Groups of Loans from time to time as it would have been in if it had
not been so converted or made.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives, by-products
and other hydro- carbons, or any substance having any constituent elements
displaying any of the foregoing characteristics.
"Indemnitee" has the meaning set forth in Section 9.3(b).
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending one,
two, three or six months thereafter, as each Borrower or CarrAmerica LP, as the
case may be, may elect in the applicable Notice of Borrowing; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business
Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clause (c) below, end on the last
Euro-Dollar Business Day of a calendar month; and
(c) if any Interest Period includes a date on which a payment
of principal of the Loans is required to be made under Section 2.9 but
does not end on such date, then (i) the principal amount (if any) of
each Euro-Dollar Loan required to be repaid on such date
18
shall have an Interest Period ending on such date and (ii) the
remainder (if any) of each such Euro-Dollar Loan shall have an Interest
Period determined as set forth above.
(2) with respect to each Base Rate Borrowing, the period commencing on the date
of such Borrowing and ending 30 days thereafter; provided that:
(a) any Interest Period (other than an Interest Period
determined pursuant to clause (c)(i) above) which would otherwise end
on a day which is not a Euro-Dollar Business Day shall be extended to
the next succeeding Euro-Dollar Business Day; and
(b) if any Interest Period includes a date on which a payment
of principal of the Loans is required to be made under Section 2.9 but
does not end on such date, then (i) the principal amount (if any) of
each Base Rate Loan required to be repaid on such date shall have an
Interest Period ending on such date and (ii) the remainder (if any) of
each such Base Rate Loan shall have an Interest Period determined as
set forth above.
"Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended, or any successor statute.
"Investment Grade Rating" means a rating for a Person's senior
long-term unsecured debt, or if no such rating has been issued, a "shadow"
rating, of BBB- or better from S&P, and a rating or "shadow" rating of Baa3 or
better from Moody's or a rating or "shadow" rating equivalent to the foregoing
from either Duff & Xxxxxx or Fitch. Any such "shadow" rating shall be evidenced
by a letter from the applicable Rating Agency or by such other evidence as may
be reasonably acceptable to the Lead Agent (as to any such other evidence, the
Lead Agent shall present the same to, and discuss the same with, the Banks).
"Lead Agent" means Xxxxxx Guaranty Trust Company of New York in
its capacity as Lead Agent for the Banks hereunder, and its successors in such
capacity.
"Letter(s) of Credit" has the meaning provided in Section
2.2(b).
19
"Letter of Credit Collateral" has the meaning provided in
Section 6.4.
"Letter of Credit Collateral Account" has the meaning provided
in Section 6.4.
"Letter of Credit Documents" has the meaning provided in Section
2.16.
"Letter of Credit Usage" means at any time the sum of (i) the
aggregate maximum amount available to be drawn under the Letters of Credit then
outstanding, assuming compliance with all requirements for drawing referred to
therein, and (ii) the aggregate amount of the Borrowers' unpaid obligations
under this Agreement in respect of the Letters of Credit.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind, or any other type
of preferential arrangement that has the practical effect of creating a security
interest, in respect of such asset. For the purposes of this Agreement, each of
the Borrowers or any Subsidiary shall be deemed to own subject to a Lien any
asset which it has acquired or holds subject to the interest of a vendor or
lessor under any conditional sale agreement, capital lease or other title
retention agreement relating to such asset.
"Loan" means a Base Rate Loan or a Euro-Dollar Loan and "Loans"
means Base Rate Loans or Euro-Dollar Loans or any combination of the foregoing.
"Loan Documents" means this Agreement, the Notes, Letters of
Credit and Letter of Credit Documents.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.6(b).
"Margin Stock" shall have the meaning provided such term in
Regulation U and Regulation G of the Federal Reserve Board.
"Material Adverse Effect" means a material adverse effect upon
(i) the business, operations, properties or assets of either Borrower or (ii)
the ability of either Borrower
20
to perform its obligations hereunder in all material respects, including to pay
interest and principal.
"Material Plan" means at any time a Plan or Plans having
aggregate Unfunded Liabilities in excess of $5,000,000.
"Materials of Environmental Concern" means and includes
pollutants, contaminants, hazardous wastes, toxic and hazardous substances,
petroleum and petroleum by-products.
"Maturity Date" has the meaning set forth in Section 2.8.
"Maximum Total Debt Ratio" means the ratio as of the date of
determination of (i) the sum of (x) the aggregate Debt of the Borrowers and
their Consolidated Subsidiaries and (y) the Borrowers' pro rata share of the
Debt of any Subsidiaries of the Borrowers which are not Consolidated
Subsidiaries, at the time of determination to (ii) the Tangible FMV of the
Borrowers and their Consolidated Subsidiaries.
"Minority Holdings" means partnerships, limited liability
companies and corporations held or owned by either Borrower which are not
consolidated with such Borrower on such Borrower's financial statements, other
than Bond Texas Limited Partnership, The Greystone Square 127 Associates, Xxxx
Xxxxxx 000 Associates and 0000 Xxx Xxxxxx Associates.
"Moody's" means Xxxxx'x Investors Service, Inc. or any successor
thereto.
"Xxxxxx" means Xxxxxx Guaranty Trust Company of New York, in its
individual capacity.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the ERISA
Group during such five year period.
21
"Net Operating Cash Flow" means, as of any date of
determination, with respect to all Real Property Assets and Minority Holdings of
Xxxx and its Consolidated Subsidiaries, Property Income for the previous four
consecutive quarters including the quarter then ended, but less (x) Property
Expenses with respect to all such Real Property Assets and Minority Holdings for
the previous four consecutive quarters including the quarter then ended and (y)
the greater of (i) Capital Expenditures which are not related to new
construction for the previous four consecutive quarters including the quarter
then ended, and (ii) appropriate reserves for replacements of not less than
$2.29 per square foot per annum for each Real Property Asset.
"Net Operating Income" means as of any date of determination
with respect to any Real Property Asset, Property Income for the previous four
consecutive quarters including the quarter then ended, but less Property
Expenses for the previous four consecutive quarters including the quarter then
ended.
"New Acquisition" has the meaning set forth in Section 5.15.
"Non-Recourse Debt" means Debt of either Borrower on a
consolidated basis for which the right of recovery of the obligee thereof is
limited to recourse against the Real Property Assets securing such Debt (subject
to such limited exceptions to the non-recourse nature of such Debt such as
fraud, misappropriation, misapplication and environmental indemnities, as are
usual and customary in like transactions at the time of the incurrence of such
Debt).
"Notes" means collectively, the Tranche A Notes and the Tranche
B Notes.
"Notice of Borrowing" means a Notice of Borrowing (as defined in
Section 2.2).
"Obligations" means all obligations, liabilities and
indebtedness of every nature of the Borrowers or CarrAmerica LP, from time to
time owing to any Bank under or in connection with this Agreement or any other
Loan Document.
22
"Outstanding Balance" means the sum of (i) the aggregate
outstanding and unpaid principal balance of all Loans and (ii) the Letter of
Credit Usage.
"Outstanding Working Capital Amount" means the aggregate
outstanding and unpaid principal balance of all Loans used for working capital
purposes from time to time.
"Parent" means, with respect to any Bank, any Person controlling
such Bank.
"Participant" has the meaning set forth in Section 9.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Liens" means (a) Liens in favor of either or both of
the Borrowers or CarrAmerica LP on all or any part of the assets of Subsidiaries
of either Borrower or CarrAmerica LP, provided that (i) such Subsidiary shall be
a co-maker of the Tranche A Notes or Tranche B Notes, as applicable, (ii) the
Debt to which such Lien relates is held by a Borrower or CarrAmerica LP, (iii)
such Debt is not otherwise pledged or encumbered and (iv) no more than 25% of
the Borrowing Base Properties Value may be subject to any such Liens; (b) Liens
to secure the performance of statutory obligations, surety or appeal bonds,
performance bonds, completion bonds, government contracts or other obligations
of a like nature, including Liens in connection with workers' compensation,
unemployment insurance and other types of statutory obligations or to secure the
performance of tenders, bids, leases, contracts (other than for the repayment of
Debt) and other similar obligations incurred in the ordinary course of business;
(c) Liens for taxes, assessments or governmental charges or claims that are not
yet delinquent or that are being contested in good faith by appropriate
proceedings promptly instituted and diligently concluded; provided, that any
reserve or other appropriate provision as shall be required in conformity with
GAAP shall have been made therefor; (d) Liens on property of either Borrower or
any Subsidiary thereof in favor of the Federal or any state government to secure
certain payments pursuant to any contract, statute or regulation; (e) easements
(including, without limitation, reciprocal easement agreements
23
and utility agreements), rights of way, covenants, consents, reservations,
encroachments, variations and zoning and other restrictions, charges or
encumbrances (whether or not recorded), which do not interfere materially with
the ordinary conduct of the business of the applicable Borrower or any
Subsidiary thereof and which do not materially detract from the value of the
property to which they attach or materially impair the use thereof by the
applicable Borrower or Subsidiary; (f) statutory Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen or other Liens
imposed by law and arising in the ordinary course of business, for sums not then
due and payable (or which, if due and payable are being contested in good faith
and with respect to which adequate reserves are being maintained to the extent
required by GAAP); (g) Liens not otherwise permitted by this definition and
incurred in the ordinary course of business of either or both of the Borrowers
or any Subsidiary with respect to obligations which do not exceed $2,000,000 in
principal amount in the aggregate at any one time outstanding; (h) Liens
existing on the date of the Agreement which have been disclosed on Schedule
4.28; (i) the interests of lessees and lessors under leases of real or personal
property made in the ordinary course of business which would not have a material
adverse effect on the Borrowers and their Subsidiaries taken as a whole; and (j)
judgment and attachment Liens not giving rise to an Event of Default.
"Permitted LTV Ratio" means any Borrowers LTV Ratio which is 50%
or lower.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan (other
than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for
24
employees of any Person which was at such time a member of the ERISA Group.
"Prime Rate" means the rate of interest publicly announced by
Xxxxxx Guaranty Trust Company of New York in New York City from time to time as
its Prime Rate.
"Pro-Forma Debt Service" means the amount determined by applying
a 25 year mortgage style amortization schedule to the Loans outstanding as of
the last day of each calendar quarter, using an interest rate equal to the
greater of (i) the Treasury Rate plus 1.75%, and (ii) the actual rate of
interest in effect with respect to the Loans as of the last day of such quarter,
all determined on an annualized basis.
"Property Expenses" means, when used with respect to any Real
Property Asset, the costs of maintaining such Real Property Asset which are the
responsibility of the owner thereof and that are not paid directly by the tenant
thereof, including, without limitation, taxes, insurance, repairs and
maintenance, but provided that if such tenant is more than 60 days in arrears in
the payment of base or fixed rent, then such costs will also constitute
"Property Expenses", but excluding depreciation, amortization and interest
costs.
"Property Income" means, when used with respect to any Real
Property Asset, cash rents and other cash revenues received in the ordinary
course therefrom, including, without limitation, revenues from any parking
leases and lease termination fees amortized over the remaining term of the lease
for which such termination fee was received (other than the paid rents and
revenues and security deposits except to the extent applied in satisfaction of
tenants' obligations for rent).
"Rating Agencies" means, collectively, S&P, Moody's, Duff &
Xxxxxx and Fitch.
"Real Property Assets" means as of any time, the real property
assets (including interests in participating mortgages in which either
Borrower's interest therein is characterized as equity according to GAAP) owned
directly or indirectly by either Borrower at such time.
25
"Recourse Debt" shall mean Debt of the Borrower or any
Consolidated Subsidiary that is not Non-Recourse Debt.
"Reference Bank" means the principal London offices of Xxxxxx
Guaranty Trust Company of New York.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Request to Extend" shall have the meaning set
forth in Section 2.8.
"Required Banks" means at any time Banks having at least 51% of
the aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding Notes evidencing at least 51% of the aggregate unpaid
principal amount of the Loans.
"Solvent" means, with respect to any Person, that the fair
saleable value of such Person's assets exceeds the Debts of such Person.
"S&P" means Standard & Poor's Ratings Group, or
any successor thereto.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests representing either (i) ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions or (ii) a majority of the economic interest therein, are at
the time directly or indirectly owned by Xxxx or Xxxx XX, including, without
limitation, Xxxx Real Estate Services, Inc., Xxxx Real Estate Services of
Northern Virginia, Inc., Xxxx Development and Construction, Inc. and
CarrAmerica LP.
"Survey" means a survey (prepared in accordance with the ALTA
appropriate specifications) for each Borrowing Base Property, prepared or
re-certified on a date not earlier than June 30, 1995, by a land surveyor duly
licensed in the state in which such Borrowing Base Property or New Acquisition
is located.
"Tangible FMV" means the aggregate of (i) Xxxx Tangible FMV and
(ii) Xxxx XX Tangible FMV.
26
"Term" has the meaning set forth in Section 2.8.
"Title Company" means, with respect to each Borrowing Base
Property, a title insurance company of recognized national standing.
"Title Commitment" means, for each Borrowing Base Property, an
ALTA fee or leasehold title commitment or title policy issued by the Title
Company.
"Tranche A Commitment" means, with respect to each Bank, the
amount committed by such Bank pursuant to this Agreement with respect to any
Tranche A Loans, as such amount may be reduced from time to time pursuant to
Sections 2.8 and 2.9.
"Tranche A Loan" means the loan or loans to be made to Xxxx and
CarrAmerica LP for the purposes set forth in Section 5.15 hereof which loan or
loans shall either be a Base Rate Loan or Loans or a Euro-Dollar Loan or Loans.
"Tranche A Loan Amount" has the meaning set forth in Section
2.1(a).
"Tranche A Notes" means the promissory notes of Xxxx and
CarrAmerica LP, each substantially in the form of Exhibit A-1 hereto, evidencing
the joint and several obligation of Xxxx and CarrAmerica LP to repay the Tranche
A Loans, and "Tranche A Note" means any one of such promissory notes issued
hereunder.
"Tranche B Commitment" means, with respect to each Bank, the
amount committed by such Bank pursuant to this Agreement with respect to any
Tranche B Loans, as such amount may be reduced from time to time pursuant to
Sections 2.8 and 2.9.
"Tranche B Loan" means the loan or loans to be made to Xxxx XX
and Xxxx for the purposes set forth in Section 5.15 hereof which loan or loans
shall either be a Base Rate Loan or Loans or a Euro-Dollar Loan or Loans.
"Tranche B Loan Amount" has the meaning set forth in Section
2.1(b).
27
"Tranche B Notes" means the promissory notes of Xxxx XX and
Xxxx, each substantially in the form of Exhibit A-2 hereto, evidencing the joint
and several obligation of Xxxx XX and Xxxx to repay the Tranche B Loans, and
"Tranche B Note" means any one of such promissory notes issued hereunder.
"Treasury Rate" means, as of any date, a rate equal to the
annual yield to maturity on the U.S. Treasury Constant Maturity Series with a
ten year maturity, as such yield is reported in Federal Reserve Statistical
Release H.15 -- Selected Interest Rates, published most recently prior to the
date the applicable Treasury Rate is being determined. Such yield shall be
determined by straight line linear interpolation between the yields reported in
Release H.15, if necessary. In the event Release H.15 is no longer published,
the Lead Agent shall select, in its reasonable discretion, an alternate basis
for the determination of Treasury yield for U.S. Treasury Constant Maturity
Series with ten year maturities.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the value of all benefit liabilities
under such Plan, determined on a plan termination basis using the assumptions
prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the
fair market value of all Plan assets allocable to such liabilities under Title
IV of ERISA (excluding any accrued but unpaid contributions), all determined as
of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the ERISA Group
to the PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including
the States and the District of Columbia, but excluding its territories and
possessions.
"Unused Commitments" means an amount equal to all unadvanced
funds (other than unadvanced funds in connection with any construction loan)
which any third party is obligated to advance to either of the Borrowers or
otherwise, pursuant to any loan document, written instrument or otherwise.
28
SECTION 1.2. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with generally accepted accounting principles as in effect from time
to time, applied on a basis consistent (except for changes concurred in by the
Borrowers' independent public accountants) with the most recent audited
consolidated financial statements of Xxxx delivered to the Lead Agent and the
Banks; provided that, if Xxxx notifies the Lead Agent and the Banks that Xxxx
wishes to amend any covenant in Article V to eliminate the effect of any change
in generally accepted accounting principles on the operation of such covenant
(or if the Lead Agent notifies Xxxx that the Required Banks wish to amend
Article V for such purpose), then Xxxx'x compliance with such covenant shall be
determined on the basis of generally accepted accounting principles in effect
immediately before the relevant change in generally accepted accounting
principles became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to Xxxx and the Required Banks.
SECTION 1.3. Types of Borrowings. The term "Borrowing" denotes
the aggregation of Loans of one or more Banks to be made to the Borrowers
pursuant to Article II on a single date and for a single Interest Period.
Borrowings are classified for purposes of this Agreement by reference to the
pricing of Loans comprising such Borrowing (e.g., a "Euro-Dollar Borrowing" is a
Borrowing comprised of Euro-Dollar Loans).
ARTICLE II
THE CREDITS
SECTION 2.1. Commitments to Lend.
(a) Each Bank severally agrees, on the terms and conditions set
forth in this Agreement, to make the Tranche A Loans to Xxxx and CarrAmerica LP
and participate in Letters of Credit issued by the Fronting Bank on behalf of
Xxxx or CarrAmerica LP pursuant to this Section from time to time, but, together
with the Tranche B Loans, not more
29
frequently than twice monthly, during the Term in amounts such that the
aggregate principal amount of Tranche A Loans by such Bank at any one time
outstanding together with such Bank's pro rata share of Letter of Credit Usage
with respect to Xxxx and CarrAmerica LP shall not exceed the amount of its
Tranche A Commitment. The aggregate amount of Tranche A Loans to be made
hereunder, together with the Letter of Credit Usage with respect to Xxxx and
CarrAmerica LP, shall not exceed One Hundred Forty-One Million Dollars
($141,000,000) (the "Tranche A Loan Amount"). Each Bank severally agrees, on the
terms and conditions set forth in this Agreement, to make the Tranche B Loans to
Xxxx XX and Xxxx and participate in Letters of Credit issued by the Fronting
Bank on behalf of Xxxx XX pursuant to this Section from time to time, but,
together with the Tranche A Loans, not more frequently than twice monthly,
during the Term in amounts such that the aggregate principal amount of Tranche B
Loans by such Bank at any one time outstanding, together with such Bank's pro
rata share of Letter of Credit Usage with respect to Xxxx XX, shall not exceed
the amount of its Tranche B Commitment. The aggregate amount of Tranche B Loans
to be made hereunder, together with the Letter of Credit Usage with respect to
Xxxx XX, shall not exceed Seventy-Four Million Dollars ($74,000,000) (the
"Tranche B Loan Amount"). Each Borrowing under this subsection (a) shall be in
an aggregate principal amount of at least $2,500,000, or an integral multiple of
$1,000,000 in excess thereof (except that any such Borrowing may be in the
aggregate amount available in accordance with Section 3.2(c)) and shall be made
from the several Banks ratably in proportion to their respective Commitments.
Subject to the limitations set forth herein, any amounts repaid may be
reborrowed. Notwithstanding anything to the contrary, the number of new
Borrowings shall be limited to two Borrowings per month.
SECTION 2.2. Notice of Borrowing. (a) The applicable Borrower or
CarrAmerica LP, as the case may be, shall give the Lead Agent notice (a "Notice
of Borrowing") not later than 10:00 a.m. (New York City time) (x) one Domestic
Business Day before each Base Rate Borrowing or (y) the third Euro-Dollar
Business Day before each Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a
Domestic Business Day in the case of a Domestic Borrowing
30
or a Euro-Dollar Business Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Borrowing,
(iii) whether the Loans comprising such Borrowing are to
be Base Rate Loans or Euro-Dollar Loans,
(iv) in the case of a Euro-Dollar Borrowing, the
duration of the Interest Period applicable thereto, subject to the provisions of
the definition of Interest Period,
(v) the intended use for the proceeds of such Borrowing,
and
(vi) the Outstanding Working Capital Amount.
(b) Either Borrower or CarrAmerica LP shall give the Lead Agent,
and the designated Fronting Bank, written notice in the event that it desires to
have Letters of Credit (each, a "Letter of Credit") issued hereunder no later
than 10:00 a.m., New York City time, at least four (4) Domestic Business Days
prior to the date of such issuance. Each such notice shall specify (i) the
designated Fronting Bank, (ii) the aggregate amount of the requested Letters of
Credit, (iii) the individual amount of each requested Letter of Credit and the
number of Letters of Credit to be issued, (iv) the date of such issuance (which
shall be a Domestic Business Day), (v) the name and address of the beneficiary,
(vi) the expiration date of the Letter of Credit (which in no event shall be
later than twelve (12) months after the issuance of such Letter of Credit or the
Maturity Date, whichever is earlier), (vii) the purpose and circumstances for
which such Letter of Credit is being issued and (viii) the terms upon which each
such Letter of Credit may be drawn down (which terms shall not leave any
discretion to Fronting Bank). Each such notice may be revoked telephonically by
the applicable Borrower or CarrAmerica LP, as the case may be, to the applicable
Fronting Bank and the Lead Agent any time prior to the date of issuance of the
Letter of Credit by the applicable Fronting Bank, provided such revocation is
confirmed in writing by such Borrower or CarrAmerica LP to the Fronting Bank and
the Lead Agent within one (1) Domestic Business Day by facsimile. No later than
10:00 a.m., New York City time, on the date that is four (4) Domestic Business
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Days prior to the date of issuance, the applicable Borrower or CarrAmerica LP
shall specify a precise description of the documents and the verbatim text of
any certificate to be presented by the beneficiary of such Letter of Credit,
which if presented by such beneficiary prior to the expiration date of the
Letter of Credit would require the Fronting Bank to make a payment under the
Letter of Credit; provided that Fronting Bank may, in its reasonable judgment,
require changes in any such documents and certificates only in conformity with
changes in customary and commercially reasonable practice or law and provided
further, that no Letter of Credit shall require payment against a conforming
draft to be made thereunder on the following Domestic Business Day that such
draft is presented if such presentation is made later than 10:00 A.M. New York
City time (except that if the beneficiary of any Letter of Credit requests at
the time of the issuance of its Letter of Credit that payment be made on the
same Domestic Business Day against a conforming draft, such beneficiary shall be
entitled to such a same day draw, provided such draft is presented to the
applicable Fronting Bank no later than 10:00 A.M. New York City time and
provided further that, prior to the issuance of such Letter of Credit, such
Borrower or CarrAmerica LP shall have requested to Fronting Bank and the Lead
Agent that such beneficiary shall be entitled to a same day draw). In
determining whether to pay on such Letter of Credit, the Fronting Bank shall be
responsible only to determine that the documents and certificates required to be
delivered under the Letter of Credit have been delivered and that they comply on
their face with the requirements of that Letter of Credit.
SECTION 2.3. Notice to Banks; Funding of Loans.
(a) Upon receipt of a Notice of Borrowing, the Lead Agent shall
notify each Bank on the same day as it receives the Notice of Borrowing of the
contents thereof and of such Bank's share of such Borrowing and such Notice of
Borrowing shall not thereafter be revocable by the applicable Borrower or
CarrAmerica LP.
(b) Not later than 2:00 P.M. (New York City time) on the date of
each Borrowing, each Bank shall (except as provided in subsection (c) of this
Section) make available its share of such Borrowing, in Federal or other funds
immediately available in New York City, to the Lead Agent at
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its address referred to in Section 9.1. The Lead Agent will make the funds so
received from the Banks available to the applicable Borrower or CarrAmerica LP,
as applicable, at the Lead Agent's aforesaid address. If a Borrower or
CarrAmerica LP has requested the issuance of a Letter of Credit, no later than
12:00 Noon (New York City time) on the date of such issuance as indicated in the
notice delivered pursuant to Section 2.2(b), the Fronting Bank shall issue such
Letter of Credit in the amount so requested and deliver the same to the
applicable Borrower or CarrAmerica LP with a copy thereof to the Lead Agent.
Immediately upon the issuance of each Letter of Credit by the Fronting Bank,
such Fronting Bank shall be deemed to have sold and transferred to each other
Bank, and each such other Bank shall be deemed to, and hereby agrees to, have
irrevocably and unconditionally purchased and received from Fronting Bank,
without recourse or warranty, an undivided interest and a participation in such
Letter of Credit, any drawing thereunder, and the obligations of the applicable
Borrower or CarrAmerica LP hereunder with respect thereto, and any security
therefor or guaranty pertaining thereto, in an amount equal to such Bank's
ratable share thereof (based upon the ratio its Commitment bears the aggregate
of all Commitments). Upon any change in any of the Commitments in accordance
herewith, there shall be an automatic adjustment to such participations to
reflect such changed shares. The Fronting Bank shall have the primary obligation
to fund any and all draws made with respect to such Letter of Credit
notwithstanding any failure of a participating Bank to fund its ratable share of
any such draw. The Lead Agent will instruct the Fronting Bank to make such
Letter of Credit available to such Borrower and the Fronting Bank shall make
such Letter of Credit available to the applicable Borrower or CarrAmerica LP at
the applicable Borrower's or CarrAmerica's LP aforesaid address on the date of
the Borrowing.
(c) Unless the Lead Agent shall have received notice from a Bank
prior to the date of any Borrowing that such Bank will not make available to the
Lead Agent such Bank's share of such Borrowing, the Lead Agent may assume that
such Bank has made such share available to the Lead Agent on the date of such
Borrowing in accordance with subsection (b) of this Section 2.3 and the Lead
Agent may, in reliance upon such assumption, make available to the applicable
Borrower or CarrAmerica LP, as applicable, on
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such date a corresponding amount. If and to the extent that such Bank shall not
have so made such share available to the Lead Agent, such Bank and the
applicable Borrower or CarrAmerica LP severally agree to repay to the Lead Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to the applicable
Borrower or CarrAmerica LP until the date such amount is repaid to the Lead
Agent, at (i) in the case of either Borrower or CarrAmerica LP, a rate per annum
equal to the higher of the Federal Funds Rate and the interest rate applicable
thereto pursuant to Section 2.6 and (ii) in the case of such Bank, the Federal
Funds Rate. If such Bank shall repay to the Lead Agent such corresponding
amount, such amount so repaid shall constitute such Bank's Loan included in such
Borrowing for purposes of this Agreement.
SECTION 2.4. Notes.
(a) The Tranche A Loans shall be evidenced by the Tranche A
Notes, each of which shall be payable to the order of each Bank for the account
of its Applicable Lending Office in an amount equal to each such Bank's Tranche
A Commitment.
(b) The Tranche B Loans shall be evidenced by the Tranche B
Notes, each of which shall be payable to the order of each Bank for the account
of its Applicable Lending Office in an amount equal to each such Bank's Tranche
B Commitment.
(c) Each Bank may, by notice to the Borrowers and CarrAmerica LP
and the Lead Agent, request that its Loans of a particular type be evidenced by
a separate Note in an amount equal to the aggregate unpaid principal amount of
such Loans. Each such Note shall be in substantially the form of Exhibit A-1 or
Exhibit A-2 hereto, as applicable, with appropriate modifications to reflect the
fact that it evidences solely Loans of the relevant type. Each reference in this
Agreement to the "Note" of such Bank shall be deemed to refer to and include any
or all of such Notes, as the context may require.
(d) Upon receipt of each Bank's Note pursuant to Section 3.1(a)
or (b), the Lead Agent shall forward such Note to such Bank. Each Bank shall
record the date, amount,
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type and maturity of each Loan made by it and the date and amount of each
payment of principal made by either Borrower or CarrAmerica LP with respect
thereto, and may, if such Bank so elects in connection with any transfer or
enforcement of its Note, endorse on the schedule forming a part thereof
appropriate notations to evidence the foregoing information with respect to each
such Loan then outstanding; provided that the failure of any Bank to make any
such recordation or endorsement shall not affect the obligations of the
Borrowers hereunder or under the Notes. Each Bank is hereby irrevocably
authorized by the Borrowers and CarrAmerica LP so to endorse its Note and to
attach to and make a part of its Note a continuation of any such schedule as and
when required.
(e) There shall be no more than five (5) Euro-Dollar Borrowings
outstanding at any one time pursuant to this Agreement.
SECTION 2.5. Maturity of Loans. The Loans shall mature, and the
principal amount thereof shall be due and payable, on the Maturity Date.
SECTION 2.6. Interest Rates.
(a) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made until it
becomes due, at a rate per annum equal to the sum of the Applicable Margin for
Base Rate Loans for such day plus the Base Rate for such day. Such interest
shall be payable for each Interest Period on the last day thereof.
(b) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Applicable Margin for
Euro-Dollar Loans for such day plus the Adjusted London Interbank Offered Rate
applicable to such Interest Period. Such interest shall be payable for each
Interest Period on the last day thereof and, if such Interest Period is longer
than three months, at intervals of three months after the first day thereof.
"Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to
35
the quotient obtained (rounded upward, if necessary, to the next higher 1/100 of
1%) by dividing (i) the applicable London Interbank Offered Rate by (ii) 1.00
minus the Euro-Dollar Reserve Percentage.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System in New York City with deposits exceeding five billion
dollars in respect of "Eurocurrency liabilities" (or in respect of any other
category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of extensions
of credit or other assets which includes loans by a non-United States office of
any Bank to United States residents). The Adjusted London Interbank Offered Rate
shall be adjusted automatically on and as of the effective date of any change in
the Euro-Dollar Reserve Percentage.
"London Interbank Offered Rate" applicable to any Interest
Period means the average (rounded upward, if necessary, to the next higher 1/16
of 1%) of the respective rates per annum at which deposits in dollars are
offered to the Reference Bank in the London interbank market at approximately
11:00 a.m. (London time) two Euro-Dollar Business Days before the first day of
such Interest Period in an amount approximately equal to the principal amount of
the Euro-Dollar Loan of such Reference Bank to which such Interest Period is to
apply and for a period of time comparable to such Interest Period.
(c) In the event that, and for so long as, any Event of Default
shall have occurred and be continuing, the outstanding principal amount of the
Loans, and, to the extent permitted by law, overdue interest in respect of all
Loans, shall bear interest at the annual rate of the sum of the Prime Rate and
four percent (4%).
(d) The Lead Agent shall determine each interest rate applicable
to the Loans hereunder. The Lead Agent shall give prompt notice to the
applicable Borrower or CarrAmerica LP and the Banks of each rate of interest so
36
determined, and its determination thereof shall be conclusive in the absence of
manifest error.
(e) The Reference Bank agrees to use its best efforts to furnish
quotations to the Lead Agent as contemplated by this Section. If the Reference
Bank does not furnish a timely quotation, the provisions of Section 8.1 shall
apply.
SECTION 2.7. Fees.
(a) Commitment Fee. During the Term, the Borrowers and/or
CarrAmerica LP shall pay Lead Agent for the account of the Banks ratably in
proportion to their respective Commitments, a commitment fee at an annual rate
of .25% on the daily average undrawn Commitments in any given quarter, payable
quarterly, in arrears.
(b) Letter of Credit Fee. During the Term, Borrowers and/or
CarrAmerica LP shall pay to the Lead Agent, for the account of the Banks in
proportion to their interests in respective undrawn issued Letters of Credit, a
fee (a "Letter of Credit Fee") in an amount, provided that no Event of Default
shall have occurred and be continuing, equal to a rate per annum equal to the
Applicable Margin for Euro-Dollar Loans on the daily average of such issued and
undrawn Letters of Credit, which fee shall be payable, in arrears, on each
January 1, April 1, July 1 and October 1 during the term. From the occurrence,
and during the continuance, of an Event of Default, such fee shall be increased
to be equal to four percent (4%) per annum on the daily average of such issued
and undrawn Letters of Credit.
(c) Fronting Bank Fee. The Borrowers and/or CarrAmerica LP shall
pay any Fronting Bank, for its own account, a fee (a "Fronting Bank Fee") at a
rate per annum equal to .15% of the issued and undrawn amount of such Letter of
Credit, which fee shall be in addition to and not in lieu of, the Letter of
Credit Fee. The Fronting Bank Fee shall be payable in arrears on each January 1,
April 1, July 1 and October 1 during the Term.
(d) Extension Fee. Within three (3) Domestic Business Days after
the Borrowers shall have received notice from the Lead Agent that the Request to
Extend has been approved, the Borrowers and/or CarrAmerica LP shall pay to the
37
Lead Agent for the account of the Banks ratably in proportion to their
Commitments an extension fee of .25% of the aggregate Commitments.
(e) Fees Non-Refundable. All fees set forth in this Section 2.7
shall be deemed to have been earned on the date payment is due in accordance
with the provisions hereof and shall be non-refundable. The obligation of the
Borrowers and CarrAmerica LP to pay such fees in accordance with the provisions
hereof shall be binding upon the Borrowers and CarrAmerica LP and shall inure to
the benefit of the Lead Agent and the Banks regardless of whether any Loans are
actually made.
SECTION 2.8. Mandatory Termination; Extension Option.
(a) The term (the "Term") of the Commitments shall terminate and
expire on July 30, 1998 (the "Maturity Date"), except as provided in
subparagraph (b) below.
(b) Notwithstanding the foregoing, the Borrowers may request a
one-year extension of the Maturity Date by delivering a written request therefor
to the Lead Agent (the "Request to Extend") on or before a date that is not more
than seven (7) months or less than four (4) months prior to the Maturity Date.
The Lead Agent shall promptly notify the Banks of the receipt of the Request to
Extend and each Bank shall give notice in writing to the Lead Agent not more
than thirty (30) days following its receipt of the Request to Extend of such
Bank's acceptance or rejection of such request. If all the Banks shall have
notified the Lead Agent on or before the date which is thirty (30) days
following the receipt by the Banks of the Request to Extend that they accept
such request, the Maturity Date shall be extended for one year. If any Bank
shall not have notified the Lead Agent on or prior to the date which is thirty
(30) days following the receipt by such Bank of the Request to Extend that it
accepts such request, the Maturity Date shall not be extended. The Lead Agent
shall notify the Borrowers in writing whether the Request to Extend has been
accepted or rejected. The Borrowers' right to request an extension of the
Maturity Date shall be subject to the following terms and conditions: (i) no
Event of Default shall have occurred and be continuing both on the date the
Borrowers deliver the Request to Extend to the Lead Agent and on the original
38
Maturity Date (the "Extension Date"), (ii) the Borrowers shall pay to the Lead
Agent, for the account of the Banks, the fee required pursuant to Section 2.7(d)
on or before the day which is three (3) Domestic Business Days after the
Borrowers shall have received notice from Lead Agent that the Request to Extend
has been approved and (iii) the Borrowers shall continue to be in compliance
both on the date of the delivery of the Request to Extend and on the Extension
Date with the provisions of Sections 5.8 through 5.20; provided, however, if
Borrowers and CarrAmerica LP are in compliance on the date of the delivery of
the Request to Extend but not on the Extension Date with the provisions of
Sections 5.8 through 5.20, the Borrowers or CarrAmerica LP, as applicable, shall
be entitled to the return of the fee required pursuant to Section 2.7(d). The
Borrowers' delivery of the Request to Extend shall be irrevocable. Upon the date
of the termination of the Term, any Loans then outstanding (together with
accrued interest thereon) shall be due and payable on such date, the Commitments
shall terminate and the Borrowers and CarrAmerica LP shall return or cause to be
returned all Letters of Credit to the Fronting Bank.
SECTION 2.9. Mandatory Prepayment.
(a) If as of the last day of any calendar quarter the Borrowers
LTV Ratio exceeds the Permitted LTV Ratio, but the Borrowers LTV Ratio is not
greater than 52.5%, and provided that no Event of Default has occurred and is
continuing, either (i) Xxxx or Xxxx XX shall add additional Real Property Assets
to the Borrowing Base Properties within 90 days of the date the Borrowers LTV
Ratio exceeded the Permitted LTV Ratio, in accordance with the provisions of
Section 3.3, or (ii) the Borrowers and/or CarrAmerica LP shall pay to the Lead
Agent, for the account of the Banks, within 90 days of the date the Borrowers
LTV Ratio exceeded the Permitted LTV Ratio, an amount such that the Loans
outstanding subsequent to such payment do not cause the Borrowers LTV Ratio to
exceed the Permitted LTV Ratio. In the event that the Borrowers LTV Ratio
exceeds the Permitted LTV Ratio and is greater than or equal to 52.5%, then the
Borrowers and/or CarrAmerica LP shall, within twenty-five (25) days from the
last day of any calendar quarter or the date of any New Acquisition when the
Permitted LTV Ratio is exceeded, pay to the Lead Agent, for the account of the
Banks, an amount such that the Loans outstanding subsequent to such
39
payment do not cause the Borrowers LTV Ratio to exceed the Permitted LTV Ratio.
(b) In the event that a Borrowing Base Property is sold or
released from the restrictions of Section 5.14 hereof, in accordance with this
Agreement, the applicable Borrower shall simultaneously with such sale or
release, prepay to the Lead Agent, for the account of the Banks, an amount equal
to the greater of (x) the amount required such that the Tranche A Loans or
Tranche B Loans, as applicable, remain in compliance with the Permitted LTV
Ratio after such sale or release and (y) either (i) 100% of the Xxxx Allocated
Borrowing Base Property Loan Amount for any Xxxx Borrowing Base Property or (ii)
100% of the Xxxx XX Allocated Borrowing Base Property Loan Amount for any Xxxx
XX Borrowing Base Property. Notwithstanding the foregoing, a simultaneous
like-kind exchange under Section 1031 of the Internal Revenue Code will not be
subject to the provisions of this Section 2.9(b) provided that the exchanged
property has qualified as a New Acquisition and any "boot" associated therewith
shall be applied to prepayment of the Tranche A Loans or Tranche B Loans, as
applicable. Sale of a property in violation of this Section 2.9 shall constitute
an Event of Default.
(c) In the event that the Borrowing Base Properties Minimum Debt
Service Coverage is not maintained as of the last day of a calendar quarter,
either (i) the Borrowers will add a New Acquisition or a Real Property Asset to
the Borrowing Base Properties in accordance with this Agreement which, on a pro
forma basis (i.e. the Borrowing Base Properties Minimum Debt Service Coverage
shall be recalculated to include such New Acquisition or Real Property Asset as
though the same had been a Borrowing Base Property for the entire applicable
period) would result in compliance with the Borrowing Base Properties Minimum
Debt Service Coverage or (ii) the Borrowers and/or CarrAmerica LP shall prepay
to the Lead Agent, for the account of the Banks, an amount necessary to cause
the Borrowing Base Properties Minimum Debt Service Coverage to be in compliance.
Failure by the Borrowers and/or CarrAmerica LP to comply with the Borrowing Base
Properties Minimum Debt Service Coverage within 90 days of the date of such
non-compliance shall be an Event of Default.
40
(d) If as of the last day of any calendar quarter the Xxxx LTV
Ratio exceeds 50%, but the Xxxx LTV Ratio is not greater than 52.5%, and
provided that no Event of Default has occurred and is continuing, either (i)
Xxxx shall add additional Real Property Assets to the Xxxx Borrowing Base
Properties within 90 days of the date the Xxxx LTV Ratio exceeded 50%, in
accordance with the provisions of Section 3.3, or (ii) Xxxx shall pay to the
Lead Agent, for the account of the Banks, within 90 days of the date the Xxxx
LTV Ratio exceeded 50%, an amount such that the Tranche A Loans outstanding
subsequent to such payment shall not cause the Xxxx LTV Ratio to be greater than
50%. In the event that the Xxxx LTV Ratio exceeds 50% and is greater than or
equal to 52.5%, then Xxxx shall, within twenty-five (25) days from the last day
of any calendar quarter or the date of any New Acquisition when the Xxxx LTV
Ratio is greater than 50%, pay to the Lead Agent, for the account of the Banks,
an amount such that the Tranche A Loans outstanding subsequent to such payment
shall not cause the Xxxx LTV Ratio to be greater than 50%.
(e) If as of the last day of any calendar quarter the Xxxx XX
LTV Ratio exceeds 50%, but the Xxxx XX LTV Ratio is not greater than 52.5%, and
provided that no Event of Default has occurred and is continuing, either (i)
Xxxx XX shall add additional Real Property Assets to the Xxxx XX Borrowing Base
Properties within 90 days of the date the Xxxx XX LTV Ratio exceeded 50%, in
accordance with the provisions of Section 3.3, or (ii) Xxxx XX shall pay to the
Lead Agent, for the account of the Banks, within 90 days of the date the Xxxx XX
LTV Ratio exceeded 50%, an amount such that the Tranche B Loans outstanding
subsequent to such payment do not cause the Xxxx XX LTV Ratio to be greater than
50%. In the event that the Xxxx XX LTV Ratio exceeds 50% and is greater than or
equal to 52.5%, then Xxxx XX shall, within twenty-five (25) days from the last
day of any calendar quarter or the date of any New Acquisition when the Xxxx XX
LTV Ratio is greater than 50%, pay to the Lead Agent, for the account of the
Banks, an amount such that the Tranche B Loans outstanding subsequent to such
payment shall not cause the Xxxx XX LTV Ratio to be greater than 50%.
SECTION 2.10. Optional Prepayments.
(a) The Borrowers or CarrAmerica LP may, upon at least one
Domestic Business Day's notice to the Lead Agent,
41
prepay to the Lead Agent, for the account of the Banks, any Base Rate Borrowing
in whole at any time, or from time to time in part in amounts aggregating One
Million Dollars ($1,000,000), or an integral multiple of One Million Dollars
($1,000,000) in excess thereof or, if less, the outstanding principal balance,
by paying the principal amount to be pre-paid together with accrued interest
thereon to the date of prepayment. Each such optional prepayment shall be
applied to prepay ratably the Loans of the several Banks included in such
Borrowing. Any notice of prepayment delivered pursuant to this Section 2.10(a)
shall set forth the amount of such prepayment which is applicable to any Loan
made for working capital purposes and the Outstanding Working Capital Amount
after such prepayment is made.
(b) Except as provided in Section 8.2, a Borrower or CarrAmerica
LP may not prepay all or any portion of the principal amount of any Euro-Dollar
Loan prior to the maturity thereof unless the applicable Borrower or CarrAmerica
LP shall also pay any applicable expenses pursuant to Section 2.12. Any such
prepayment shall be upon at least three (3) Euro-Dollar Business Days' notice to
the Lead Agent. Any notice of prepayment delivered pursuant to this Section
2.10(b) shall set forth the amount of such prepayment which is applicable to any
Loan made for working capital purposes and the Outstanding Working Capital
Amount after such pre-payment is made. Each such optional prepayment shall be in
the amounts set forth in Section 2.10(a) above and shall be applied to prepay
ratably the Loans of the Banks included.
(c) A Borrower or CarrAmerica LP may, upon at least one (1)
Domestic Business Day's notice to the Lead Agent (by 11:00 a.m New York time on
such Domestic Business Day), reimburse the Lead Agent for the benefit of the
Fronting Bank for the amount of any drawing under a Letter of Credit in whole or
in part in any amount.
(d) A Borrower or CarrAmerica LP may at any time return any
undrawn Letters of Credit to the Fronting Bank in whole, but not in part, and
the Fronting Bank shall endeavor to give the Lead Agent and each of the Banks
notice of such return.
(e) Either Borrower may at any time and from time to time cancel
all or any part of the Tranche A Commitments or Tranche B Commitments, as
applicable, in amounts aggregating
42
One Million Dollars ($1,000,000), or an integral multiple of One Million Dollars
($1,000,000) in excess thereof, by the delivery to the Lead Agent and the Banks
of a notice of cancellation upon at least three (3) Domestic Business Days'
notice to Lead Agent and the Banks, whereupon, in either event, all or such
portion of the Tranche A Commitments or Tranche B Commitments, as applicable,
shall terminate as to the Banks, pro rata on the date set forth in such notice
of cancellation, and, if there are any Loans then outstanding in an aggregate
amount which exceeds the aggregate Tranche A Commitments or Tranche B
Commitments, as applicable (after giving effect to any such reduction), the
applicable Borrower shall prepay to the Lead Agent, for the account of the
Banks, as applicable, all or such portion of Loans outstanding on such date in
accordance with the requirements of Sections 2.10(a) and (b). In no event shall
either Borrower be permitted to cancel Commitments for which a Letter of Credit
has been issued and is outstanding unless such Borrower returns (or causes to be
returned) such Letter of Credit to the Fronting Bank. A Borrower shall be
permitted to designate in its notice of cancellation which Loans, if any, are to
be prepaid.
(f) Upon receipt of a notice of prepayment or cancellation or a
return of a Letter of Credit pursuant to this Section, the Lead Agent shall
promptly, and in any event within one (1) Domestic Business Day, notify each
Bank of the contents thereof and of such Bank's ratable share (if any) of such
prepayment or cancellation and such notice shall not thereafter be revocable by
the Borrowers or CarrAmerica LP.
(g) Any amounts so prepaid pursuant to this Section 2.10 may be
reborrowed subject to the other terms of this Agreement. In the event either
Borrower elects to cancel all or any portion of the Commitments pursuant to
Section 2.10(e) hereof, such amounts may not be reborrowed.
SECTION 2.11. General Provisions as to Payments.
(a) The Borrowers and CarrAmerica LP shall make each payment of
principal of, and interest on, the Loans and of fees hereunder, not later than
12:00 Noon (New York City time) on the date when due, in Federal or other funds
immediately available in New York City, to the Lead Agent at its address
referred to in Section 9.1. The Lead Agent will
43
distribute to each Bank its ratable share of each such payment received by the
Lead Agent for the account of the Banks on the same day as received by the Lead
Agent if received by the Lead Agent by 3:00 p.m. (New York City time), or, if
received by the Lead Agent after 3:00 p.m. (New York City time), on the
immediately following Domestic Business Day. Whenever any payment of principal
of, or interest on, the Base Rate Loans or of fees shall be due on a day which
is not a Domestic Business Day, the date for payment thereof shall be extended
to the next succeeding Domestic Business Day. Whenever any payment of principal
of, or interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time.
(b) Unless the Lead Agent shall have received notice from a
Borrower or CarrAmerica LP prior to the date on which any payment is due to the
Banks hereunder that such Borrower or CarrAmerica LP will not make such payment
in full, the Lead Agent may assume that such Borrower or CarrAmerica LP, as
applicable has made such payment in full to the Lead Agent on such date and the
Lead Agent may, in reliance upon such assumption, cause to be distributed to
each Bank on such due date an amount equal to the amount then due such Bank. If
and to the extent that such Borrower or CarrAmerica LP shall not have so made
such payment, each Bank shall repay to the Lead Agent forthwith on demand such
amount distributed to such Bank together with interest thereon, for each day
from the date such amount is distributed to such Bank until the date such Bank
repays such amount to the Lead Agent, at the Federal Funds Rate.
SECTION 2.12. Funding Losses. If a Borrower or CarrAmerica LP
makes any payment of principal with respect to any Euro-Dollar Loan (pursuant to
Article II, VI or VIII or otherwise) on any day other than the last day of the
Interest Period applicable thereto, or the last day of an applicable period
fixed pursuant to Section 2.6(b), or if a Borrower fails to borrow any
Euro-Dollar Loans, after notice has been given to any Bank in accordance with
Section
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2.3(a), such Borrower or CarrAmerica LP shall reimburse each Bank within 15 days
after demand for any resulting loss or expense incurred by it (or by an existing
Participant in the related Loan), including (without limitation) any loss
incurred in obtaining, liquidating or employing deposits from third parties, but
excluding loss of margin for the period after any such payment or failure to
borrow, provided that such Bank shall have delivered to such Borrower or
CarrAmerica LP a certificate as to the amount of such loss or expense and the
calculation thereof, which certificate shall be conclusive in the absence of
manifest error.
SECTION 2.13. Computation of Interest and Fees. Interest based
on the Prime Rate hereunder shall be computed on the basis of a year of 365 days
(or 366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest and
fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.14. Method of Electing Interest Rates.
(a) The Loans included in each Borrowing shall bear interest initially
at the type of rate specified by such Borrower or CarrAmerica LP in the
applicable Notice of Borrowing. Thereafter, such Borrower or CarrAmerica LP, as
applicable, may from time to time elect to change or continue the type of
interest rate borne by each Group of Loans (subject in each case to the
provisions of Article VIII), as follows:
(i) if such Loans are Base Rate Loans, a Borrower or CarrAmerica
LP, as applicable, may elect to convert such Loans to Euro-Dollar Loans as of
any Euro-Dollar Business Day;
(ii) if such Loans are Euro-Dollar Loans, a Borrower or
CarrAmerica LP, as applicable, may elect to convert such Loans to Base Rate
Loans or elect to continue such Loans as Euro-Dollar Loans for an additional
Interest Period, in each case effective on the last day of the then current
Interest Period applicable to such Loans.
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Each such election shall be made by delivering a notice (a "Notice of Interest
Rate Election") to the Lead Agent at least three (3) Euro-Dollar Business Days
before the conversion or continuation selected in such notice is to be effective
(unless the relevant Loans are to be continued as Base Rate Loans, in which case
such notice shall be delivered to the Lead Agent no later than 12:00 Noon (New
York City time) at least one (1) Domestic Business Day before such continuation
is to be effective). A Notice of Interest Rate Election may, if it so specifies,
apply to only a portion of the aggregate principal amount of the relevant Group
of Loans; provided that (i) such portion is allocated ratably among the Loans
comprising such Group, (ii) the portion to which such notice applies, and the
remaining portion to which it does not apply, are each $1,000,000 or any larger
multiple of $1,000,000, (iii) there shall be no more than five (5) Borrowings
comprised of Euro-Dollar Loans outstanding at any time under this Agreement,
(iv) no Loan may be continued as, or converted into, a Euro-Dollar Loan when any
Event of Default has occurred and is continuing, and (v) no Interest Period
shall extend beyond the Maturity Date.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Loans (or portion thereof) to which such notice
applies;
(ii) the date on which the conversion or continuation selected
in such notice is to be effective, which shall comply with the applicable clause
of subsection (a) above;
(iii) if the Loans comprising such Group are to be converted,
the new type of Loans and, if such new Loans are Euro-Dollar Loans, the duration
of the initial Interest Period applicable thereto; and
(iv) if such Loans are to be continued as Euro-Dollar Loans for
an additional Interest Period, the duration of such additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
46
(c) Upon receipt of a Notice of Interest Rate Election from a Borrower
or CarrAmerica LP pursuant to subsection (a) above, the Lead Agent shall notify
each Bank on the same day as it receives such Notice of Interest Rate Election
of the contents thereof and such notice shall not thereafter be revocable by
such Borrower or CarrAmerica LP. If such Borrower or CarrAmerica LP fails to
deliver a timely Notice of Interest Rate Election to the Lead Agent for any
Group of Euro-Dollar Loans, such Loans shall be converted into Base Rate Loans
on the last day of the then current Interest Period applicable thereto.
SECTION 2.15. Letters of Credit. (a) Subject to the terms
contained in this Agreement and the other Loan Documents, upon the receipt of a
notice in accordance with Section 2.2(b) requesting the issuance of a Letter of
Credit, the Fronting Bank shall issue a Letter of Credit or Letters of
Credit in such form as is reasonably acceptable to the applicable Borrower or
CarrAmerica LP, as applicable, in an amount or amounts equal to the amount or
amounts requested by the applicable Borrower or CarrAmerica LP.
(b) Each Letter of Credit shall be issued in the minimum amount
of One Million Dollars ($1,000,000).
(c) The Letter of Credit Usage shall be no more than $10,000,000
at any one time.
(d) There shall be no more than five (5) Letters of Credit
outstanding at any one time.
(e) In the event of any request for a drawing under any Letter
of Credit by the beneficiary thereunder, the Fronting Bank shall endeavor to
notify the applicable Borrower and the Lead Agent (and the Lead Agent shall
endeavor to notify each Bank thereof) on or before the date on which the
Fronting Bank intends to honor such drawing, and, except as provided in this
subsection (e), the applicable Borrower shall reimburse the Fronting Bank, in
immediately available funds, on the same day on which such drawing is honored in
an amount equal to the amount of such drawing. Notwithstanding anything
contained herein to the contrary, however, unless such Borrower or CarrAmerica
LP shall have notified the Lead Agent, and the Fronting Bank prior to 11:00 a.m.
(New York time) on the Domestic Business Day immediately prior to the date of
such drawing that such Borrower
47
intends to reimburse the Fronting Bank for the amount of such drawing with funds
other than the proceeds of the Loans, the applicable Borrower or CarrAmerica LP
shall be deemed to have timely given a Notice of Borrowing pursuant to Section
2.2 to the Lead Agent, requesting a Borrowing of Base Rate Loans on the date on
which such drawing is honored and in an amount equal to the amount of such
drawing. Each Bank (other than the Fronting Bank) shall, in accordance with
Section 2.3(b), make available its share of such Borrowing to the Lead Agent,
the proceeds of which shall be applied directly by the Lead Agent to reimburse
the Fronting Bank for the amount of such draw. In the event that any such Bank
fails to make available to the Fronting Bank the amount of such Bank's
participation on the date of a drawing, the Fronting Bank shall be entitled to
recover such amount on demand from such Bank together with interest at the
Federal Funds Rate commencing on the date such drawing is honored.
(f) If, after the date hereof, any change in any law or
regulation or in the interpretation thereof by any court or administrative or
governmental authority charged with the administration thereof shall either (a)
impose, modify or deem applicable any reserve, special deposit or similar
requirement against letters of credit issued by, or assets held by, or deposits
in or for the account of, or participations in any letter of credit, upon any
Bank (including the Fronting Bank) or (b) impose on any Bank any other condition
regarding this Agreement or such Bank (including the Fronting Bank) as it
pertains to the Letters of Credit or any participation therein and the result of
any event referred to in the preceding clause (a) or (b) shall be to increase
the cost to the Fronting Bank or any Bank of issuing or maintaining any Letter
of Credit or participating therein then the applicable Borrower or CarrAmerica
LP shall pay to the Fronting Bank or such Bank, within 15 days after written
demand by such Bank (with a copy to the Lead Agent), which demand shall be
accompanied by a certificate showing, in reasonable detail, the calculation of
such amount or amounts, such additional amounts as shall be required to
compensate the Fronting Bank or such Bank for such increased costs or reduction
in amounts received or receivable hereunder together with interest thereon at
the Base Rate. The amount specified in the written demand shall, absent manifest
error, be final and conclusive and binding upon the Borrowers and CarrAmerica
LP.
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(g) The Borrowers and CarrAmerica LP hereby agree to protect,
indemnify, pay and save the Fronting Bank harmless from and against any and all
claims, demands, liabilities, damages, losses, costs, charges and expenses
(including reasonable attorneys' fees and disbursements) which the Fronting Bank
may incur or be subject to as a result of (i) the issuance of the Letters of
Credit, other than as a result of the gross negligence or wilful misconduct of
the Fronting Bank or (ii) the failure of the Fronting Bank to honor a drawing
under any Letter of Credit as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto government or
Governmental Authority (collectively, "Governmental Acts"), other than as a
result of the gross negligence or wilful misconduct of the Fronting Bank. As
between the Borrowers, CarrAmerica LP and the Fronting Bank, the Borrowers and
CarrAmerica LP assume all risks of the acts and omissions of, or misuses of, the
Letters of Credit issued by the Fronting Bank, by the beneficiaries of such
Letters of Credit. In furtherance and not in limitation of the foregoing, the
Fronting Bank shall not be responsible (i) for the form, validity, sufficiency,
accuracy, genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of such Letters of Credit, even
if it should in fact prove to be in any and all respects invalid, insufficient,
inaccurate, fraudulent or forged; (ii) for the validity or insufficiency of any
instrument transferring or assigning or purporting to transfer or assign any
such Letter of Credit or the rights or benefits thereunder or proceeds thereof,
in whole or in part, which may prove to be invalid or ineffective for any
reason; (iii) for failure of the beneficiary of any such Letter of Credit to
comply fully with conditions required in order to draw upon such Letter of
Credit; (iv) for errors, omissions, interruptions or delays in transmission or
delivery of any message, by mail, cable, telegraph, telex, facsimile
transmission, or otherwise; (v) for errors in interpretation of any technical
terms; (vi) for any loss or delay in the transmission or otherwise of any
documents required in order to make a drawing under any such Letter of Credit or
of the proceeds thereof; (vii) for the misapplication by the beneficiary of any
such Letter of Credit of the proceeds of such Letter of Credit; and (viii) for
any consequence arising from causes beyond the control of the Fronting Bank,
including any Government Acts, in each case other than as a result
49
of the gross negligence or willful misconduct of the Fronting Bank. None of the
above shall affect, impair or prevent the vesting of the Fronting Bank's rights
and powers hereunder. In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by the
Fronting Bank under or in connection with the Letters of Credit issued by it or
the related certificates, if taken or omitted in good faith, shall not put the
Fronting Bank under any resulting liability to the Borrowers or CarrAmerica LP.
(h) If the Fronting Bank or the Lead Agent is required at any
time, pursuant to any bankruptcy, insolvency, liquidation or reorganization law
or otherwise, to return to the Borrowers or CarrAmerica LP any reimbursement by
the Borrowers or CarrAmerica LP of any drawing under any Letter of Credit, each
Bank shall pay to the Fronting Bank or the Lead Agent, as the case may be, its
share of such payment, but without interest thereon unless the Fronting Bank or
the Lead Agent is required to pay interest on such amounts to the person
recovering such payment, in which case with interest thereon, computed at the
same rate, and on the same basis, as the interest that the Fronting Bank or the
Lead Agent is required to pay.
SECTION 2.16. Letter of Credit Usage Absolute. The obligations
of the Borrowers and CarrAmerica LP under this Agreement in respect of any
Letter of Credit shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement (as the same may be
amended from time to time) and any Letter of Credit Documents (as hereinafter
defined) under all circumstances, including, without limitation, to the extent
permitted by law, the following circumstances:
(a) any lack of validity or enforceability of any Letter of Credit or
any other agreement or instrument relating thereto (collectively, the "Letter of
Credit Documents") or any Loan Document;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the obligations of either Borrower or CarrAmerica
LP in respect of the Letters of Credit or any other amendment or waiver of or
any consent by either Borrower or CarrAmerica LP to departure from all or any of
the Letter of Credit Documents or any
50
Loan Document, provided that the Fronting Bank shall not consent to any such
change or amendment unless previously consented to in writing by either Borrower
or CarrAmerica LP, as applicable;
(c) any exchange, release or non-perfection of any collateral, or any
release or amendment or waiver of or consent to departure from any guaranty, for
all or any of the obligations of either Borrower or CarrAmerica LP in respect of
the Letters of Credit;
(d) the existence of any claim, set-off, defense or other right that
either Borrower or CarrAmerica LP may have at any time against any beneficiary
or any transferee of a Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), the Lead Agent, the Fronting
Bank or any Bank (other than a defense based on the gross negligence or wilful
misconduct of the Lead Agent, the Fronting Bank or such Bank) or any other
Person, whether in connection with the Loan Documents, the transactions
contemplated hereby or by the Letters of Credit Documents or any unrelated
transaction;
(e) any draft or any other document presented under or in connection
with any Letter of Credit or other Loan Document proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; provided that payment by the Fronting
Bank under such Letter of Credit against presentation of such draft or document
shall not have constituted gross negligence or wilful misconduct of the Fronting
Bank;
(f) payment by the Fronting Bank against presentation of a draft or
certificate that does not comply with the terms of the Letter of Credit;
provided that such payment shall not have constituted gross negligence or wilful
misconduct of the Fronting Bank; and
(g) any other circumstance or happening whatsoever other than the
payment in full of all obligations hereunder in respect of any Letter of Credit
or any agreement or instrument relating to any Letter of Credit, whether or not
similar to any of the foregoing, that might otherwise constitute a defense
available to, or a discharge of, the Borrowers or CarrAmerica LP; provided that
such other circumstance
51
or happening shall not have been the result of gross negligence or wilful
misconduct of the Fronting Bank.
ARTICLE III
CONDITIONS
SECTION 3.1. Closing. The closing hereunder shall occur on the date (the
"Closing Date") when each of the following conditions is satisfied (or waived by
the Lead Agent), each document to be dated the Closing Date unless otherwise
indicated:
(a) Xxxx and CarrAmerica LP shall have executed and delivered to the
Lead Agent a Tranche A Note for the account of each Bank dated on or before the
Closing Date complying with the provisions of Section 2.4;
(b) Xxxx and Xxxx XX shall have executed and delivered to the Lead
Agent a Tranche B Note for the account of each Bank dated on or before the
Closing Date complying with the provisions of Section 2.4;
(c) the Borrowers and CarrAmerica LP shall have executed and delivered
to the Lead Agent a duly executed original of this Agreement;
(d) Lead Agent shall have received an opinion of Xxxxx & Xxxxxxx
L.L.P., with respect to certain matters of New York and Maryland law, acceptable
to the Lead Agent, the Banks and their counsel;
(e) the Lead Agent shall have received all documents the Lead Agent may
reasonably request relating to the existence of the Borrowers and CarrAmerica
LP, the authority for and the validity of this Agreement and the other Loan
Documents, and any other matters relevant hereto, all in form and substance
reasonably satisfactory to the Lead Agent. Such documentation shall include,
without limitation, the articles of incorporation and by-laws of Xxxx and the
partnership agreement and limited partnership certificate of Xxxx XX and
CarrAmerica LP, as amended, modified or supplemented to the Closing Date, each
certified to be true, correct and complete by a senior officer of Xxxx, Xxxx XX
or
52
CarrAmerica LP, as applicable, as of a date not more than forty-five (45) days
prior to the Closing Date, together with a good standing certificate from the
Secretary of State (or the equivalent thereof) of Maryland with respect to Xxxx
and a good standing certificate from the Secretary of State (or the equivalent
thereof) of Delaware with respect to Xxxx XX and CarrAmerica LP and from the
Secretary of State (or the equivalent thereof) of each other State in which
Xxxx, Xxxx XX and CarrAmerica LP is required to be qualified to transact
business, each to be dated not more than forty-five (45) days prior to the
Closing Date;
(f) the Lead Agent shall have received all certificates, agreements and
other documents and papers referred to in this Section 3.1 and Section 3.2,
unless otherwise specified, in sufficient counterparts, satisfactory in form and
substance to the Lead Agent in its sole discretion;
(g) the Borrowers and CarrAmerica LP shall have taken all actions
required to authorize the execution and delivery of this Agreement and the other
Loan Documents and the performance thereof by the Borrowers and CarrAmerica LP;
(h) the Lead Agent shall have received an unaudited consolidated
balance sheet and income statement of Xxxx for the fiscal quarter ended March
31, 1996;
(i) the Lead Agent shall have received wire transfer instructions in
connection with the Loans to be made on the Closing Date;
(j) the Lead Agent shall have received, for its and any other Bank's
account, all fees due and payable pursuant to Section 2.7 hereof on or before
the Closing Date, and the reasonable fees and expenses accrued through the
Closing Date of Skadden, Arps, Slate, Xxxxxxx & Xxxx;
(k) the Lead Agent shall have received copies of all consents, licenses
and approvals, if any, required in connection with the execution, delivery and
performance by the Borrower and CarrAmerica LP, and the validity and enforce-
ability, of the Loan Documents, or in connection with any of the transactions
contemplated thereby, and such consents, licenses and approvals shall be in full
force and effect;
53
(l) the Lead Agent shall have received satisfactory reports of Uniform
Commercial Code filing searches conducted by a search firm acceptable to the
Lead Agent with respect to the Borrowers, such searches to be conducted in each
of the locations specified by the Lead Agent;
(m) no material defaults or Events of Default (as defined therein)
shall exist under any existing agreement entered into by either Borrower or
CarrAmerica LP in connection with any Debt of such Borrower or CarrAmerica LP;
(n) the representations and warranties of the Borrowers and CarrAmerica
LP contained in this Agreement shall be true and correct in all material
respects on and as of the Closing Date both before and after giving effect to
the making of any Loans; and
(o) the Lead Agent shall have received certificates of insurance with
respect to each Borrowing Base Property demonstrating the coverages required
under this Agreement;
(p) the Lead Agent shall have received with respect to each Borrowing
Base Property, a satisfactory Title Commitment;
(q) the Lead Agent shall have received with respect to each Borrowing
Base Property, a satisfactory environmental report indicating that (A) the
Borrowing Base Property complies with all Environmental Laws in all material
respects, (B) is free of all Materials of Environmental Concern in all material
respects and (C) is not subject to any Environmental Claim, or if any of the
foregoing is not satisfied, Lead Agent shall have received from the applicable
Borrower either (i) a satisfactory indemnification indemnifying the Lead Agent
and the Banks and guaranteeing the remediation of the applicable Material of
Environmental Concern, from a tenant with an Investment Grade Rating or other
party acceptable to the Lead Agent, (ii) evidence satisfactory to the Lead Agent
in its sole discretion that the applicable Borrower has adequate rights as an
indemnitee pursuant to an environmental indemnity pursuant to which a tenant
with an Investment Grade Rating or other party acceptable to the Lead Agent
indemnifies the applicable Borrower or which guarantees the remediation of
Materials of Environmental Concern or (iii) Cash or Cash Equivalents, letters of
credit or evidence that the applicable Borrower
54
has access to such items, equal to an amount satisfactory to the Lead Agent to
be used for remediation of the applicable Material of Environmental Concern;
(r) the Lead Agent shall have received with respect to each Borrowing
Base Property, a satisfactory engineer's inspection report;
(s) the Lead Agent shall have received with respect to each Borrowing
Base Property, evidence of compliance with zoning and other local laws, together
with copies of the certificates of occupancy for each thereof (or evidence
satisfactory to the Lead Agent as to why no certificate of occupancy is
required);
(t) the Lead Agent shall have received with respect to each Borrowing
Base Property, (i) a description of the Borrowing Base Property, (ii) two years
of historical cash flow operating statements, if available, (iii) five years of
cash flow projections (including capital expenditures), (iv) the credit history
of each existing tenant which occupies more than 15% of such Borrowing Base
Property, (v) a map and site plan, including an existing Survey of the property
dated not more than twelve (12) months prior to such submission, (vi) copies of
all lease agreements with each existing tenant which occupies more than 15% of
such Borrowing Base Property and lease abstracts thereof, (vii) an estoppel
certificate from each tenant which occupies 50% or more of such Borrowing Base
Property and (viii) any investment memorandum prepared by Xxxx in connection
with the four most recent acquisitions of Borrowing Base Properties by Xxxx; and
(u) receipt by the Lead Agent and the Banks of a certificate of the
chief financial officer or the chief accounting officer of Xxxx certifying that
the Borrowers and CarrAmerica LP are in compliance with all covenants of the
Borrowers and CarrAmerica LP contained in this Agreement, including, without
limitation, the requirements of Section 5.8, as of the Closing Date.
The Lead Agent shall promptly notify the Borrowers and CarrAmerica LP and the
Banks of the Closing Date, and such notice shall be conclusive and binding on
all parties hereto.
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SECTION 3.2. Borrowings. The obligation of any Bank to make a Loan on
the occasion of any Borrowing or to participate in any Letter of Credit issued
by the Fronting Bank and the obligation of the Fronting Bank to issue a Letter
of Credit on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
(a) the Closing Date shall have occurred on or prior to August 16, 1996;
(b) receipt by the Lead Agent of a Notice of Borrowing as required by
Section 2.2;
(c) with respect to any portion of the $20,000,000 of the proceeds of
the Loans solely available for the payment of Capital Expenditures in accordance
with Section 5.15, receipt by the Lead Agent and the Banks of a certificate of
the chief financial officer or the chief accounting officer of Xxxx certifying
that the applicable Borrower will use the proceeds of such Loan for Capital
Expenditures and briefly describing such Capital Expenditures;
(d) with respect to the next Notice of Borrowing delivered to Lead Agent
after any delivery of a Notice of Borrowing and the certificate set forth in
subsection (c) of this Section 3.2, receipt by the Lead Agent and the Banks of a
certificate of the chief financial officer or the chief accounting officer of
Xxxx certifying that the applicable Borrower has used the proceeds of such Loan
for Capital Expenditures;
(e) immediately after such Borrowing, the Outstanding Balance will not
exceed the aggregate amount of the Commitments and with respect to each Bank,
such Bank's pro rata portion of the Loans and Letter of Credit Usage will not
exceed such Bank's Commitment;
(f) immediately before and after such Borrowing, no Default or Event of
Default shall have occurred and be continuing both before and after giving
effect to the making of such Loans;
(g) the representations and warranties of the Borrowers and CarrAmerica
LP contained in this Agreement shall be true and correct in all material
respects on and as of the
56
date of such Borrowing both before and after giving effect to the making of such
Loans;
(h) no law or regulation shall have been adopted, no order, judgment or
decree of any governmental authority shall have been issued, and no litigation
shall be pending or threatened, which does or, with respect to any threatened
litigation, seeks to enjoin, prohibit or restrain, the making or repayment of
the Loans, the issuance of any Letters of Credit or any participations therein
or the consummation of the transactions contemplated hereby; and
(i) no event, act or condition shall have occurred after the Closing
Date which, in the reasonable judgment of the Lead Agent or the Required Banks,
as the case may be, has had or is likely to have a Material Adverse Effect.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the applicable Borrower and CarrAmerica LP, if applicable, on the date of such
Borrowing as to the facts specified in clauses (c) through (i) of this Section
(except that with respect to clause (h), such representation and warranty shall
be deemed to be limited to laws, regulations, orders, judgments, decrees and
litigation affecting the Borrowers or CarrAmerica LP and not solely the Banks).
SECTION 3.3 Conditions Precedent to New Acquisitions and Additional Real
Property Assets.
(a) All New Acquisitions or Real Property Assets to be added to
the Borrowing Base Properties shall be approved by all the Banks.
(b) The Borrowers shall submit to the Lead Agent and the Banks
as provided in subsection (c) below the materials set forth below (the "Due
Diligence Package") relating to each potential New Acquisition or Real Property
Assets to be added to the Borrowing Base Properties. The Due Diligence Package
shall include (i) a description of the Real Property Asset or New Acquisition,
(ii) two years of historical cash flow operating statements, if available, (iii)
five years of cash flow projections (including capital expenditures), (iv) the
credit history of each existing tenant which occupies more than 15% of such Real
Property Asset or New Acquisition, (v) a map and site plan, including an
existing Survey of the property dated not more than twelve
57
(12) months prior to such submission, (vi) copies of all lease agreements with
each existing tenant which occupies more than 15% of such Real Property Asset or
New Acquisition and lease abstracts thereof, (vii) an environmental report in
compliance with Section 3.1(q), (viii) a satisfactory engineer's inspection
report, (ix) an estoppel certificate from each tenant which occupies 50% or more
of the Real Property Asset or New Acquisition, (x) evidence of compliance with
zoning and other local laws, (xi) a satisfactory Title Commitment and (xii) a
final investment memorandum prepared by Xxxx in connection with the New
Acquisition or Real Property Asset. The applicable Borrower shall permit the
Lead Agent at all reasonable times and upon reasonable prior notice to make an
inspection of such New Acquisition or Real Property Asset.
(c) The Borrowers shall distribute a copy of each item
constituting the Due Diligence Package by overnight mail to each of the Banks
for their review and approval. Failure to respond to the Lead Agent in writing
by any Bank within ten (10) Domestic Business Days after receipt of the Due
Diligence Package, shall be deemed to be an approval by such Bank of such
potential New Acquisition or Real Property Asset.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce the Lead Agent and each of the other Banks which may
become a party to this Agreement to make the Loans, the applicable Borrower or
CarrAmerica LP makes the following representations and warranties as of the date
hereof. Such representations and warranties shall survive the effectiveness of
this Agreement, the execution and delivery of the other Loan Documents and the
making of the Loans.
SECTION 4.1. Existence and Power of Xxxx. Xxxx is duly organized,
validly existing and in good standing as a corporation under the laws of the
State of Maryland and has all powers and all material governmental licenses,
authorizations, consents and approvals required to own its property and assets
and carry on its business as now conducted
58
or as it presently proposes to conduct and has been duly qualified and is in
good standing in every jurisdiction in which the failure to be so qualified
and/or in good standing is likely to have a Material Adverse Effect.
SECTION 4.2. Existence and Power of Xxxx XX and CarrAmerica LP. Xxxx XX
and CarrAmerica LP are each duly organized, validly existing and in good
standing as limited partnership under the laws of the State of Delaware and has
all powers and all material governmental licenses, authorizations, consents and
approvals required to own its property and assets and carry on its business as
now conducted or as it presently proposes to conduct and has been duly qualified
and is in good standing in every jurisdiction in which the failure to be so
qualified and/or in good standing is likely to have a Material Adverse Effect.
SECTION 4.3. Power and Authority of Xxxx. Xxxx has the corporate power
and authority to execute, deliver and carry out the terms and provisions of each
of the Loan Documents to which it is a party and has taken all necessary action
to authorize the execution and delivery on behalf of Xxxx and the performance by
Xxxx of such Loan Documents. Xxxx has duly executed and delivered each Loan
Document to which it is a party, and each such Loan Document constitutes the
legal, valid and binding obligation of Xxxx, enforceable in accordance with its
terms, except as enforceability may be limited by applicable insolvency,
bankruptcy or other laws affecting creditors rights generally, or general
principles of equity, whether such enforceability is considered in a proceeding
in equity or at law.
SECTION 4.4. Power and Authority of Xxxx XX and CarrAmerica LP. Xxxx XX
and CarrAmerica LP each have the partnership power and authority to execute,
deliver and carry out the terms and provisions of each of the Loan Documents to
which it is a party and has taken all necessary action to authorize the
execution and delivery on behalf of Xxxx XX or CarrAmerica LP, as applicable,
and the performance by Xxxx XX or CarrAmerica LP, as applicable, of such Loan
Documents. Xxxx XX and CarrAmerica LP have each duly executed and delivered each
Loan Document to which it is a party, and each such Loan Document constitutes
the legal, valid and binding obligation of Xxxx XX or CarrAmerica LP, as
applicable, enforceable in accordance with its terms, except as enforceability
may be limited by applicable insolvency,
59
bankruptcy or other laws affecting creditors rights generally, or general
principles of equity, whether such enforceability is considered in a proceeding
in equity or at law.
SECTION 4.5. No Violation. Neither the execution, delivery or
performance by or on behalf of the Borrowers or CarrAmerica LP of the Loan
Documents, nor compliance by the Borrowers or CarrAmerica LP with the terms and
provisions thereof nor the consummation of the transactions contemplated by the
Loan Documents, (i) will contravene any applicable provision of any law,
statute, rule, regulation, order, writ, injunction or decree of any court or
governmental instrumentality or (ii) will conflict with or result in any breach
of, any of the terms, covenants, conditions or provisions of, or constitute a
default under, or result in the creation or imposition of (or the obligation to
create or impose) any Lien upon any of the property or assets of the Borrowers
or CarrAmerica LP pursuant to the terms of any indenture, mortgage, deed of
trust, or other agreement or other instrument to which the Borrowers or
CarrAmerica LP (or of any partnership of which either Borrower is a partner) is
a party or by which it or any of its property or assets is bound or to which it
is subject or (iii) will cause a default by either Borrower or CarrAmerica LP
under any organizational document of any Subsidiary, or cause a default under
Xxxx'x articles of incorporation or by-laws or Xxxx LP's or CarrAmerica LP's
agreement of limited partnership.
SECTION 4.6. Financial Information.
(a) The unaudited consolidated balance sheet of Xxxx as of March 31,
1996, a copy of which has been delivered to the Lead Agent, fairly presents, in
conformity with generally accepted accounting principles, the consolidated
financial position of Xxxx as of such date and its consolidated results of
operations for such fiscal year.
(b) Since March 31, 1996, (i) there has been no material adverse change
in the business, financial position or results of operations of the Borrowers
and (ii) except as previously disclosed to the Lead Agent, neither the Borrowers
nor CarrAmerica LP have incurred any material indebtedness or guaranty.
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SECTION 4.7. Litigation.
(a) There is no action, suit or proceeding pending against, or
to the knowledge of the Borrowers or CarrAmerica LP, threatened against or
affecting, (i) the Borrowers or CarrAmerica LP or any of their Subsidiaries,
(ii) the Loan Documents or any of the transactions contemplated by the Loan
Documents or (iii) any of their assets, in any case before any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood of an adverse decision which could, individually or in the
aggregate, have a Material Adverse Effect or which in any manner draws into
question the validity of this Agreement or the other Loan Documents.
(b) There are no final nonappealable judgments or decrees in an
aggregate amount of Five Million Dollars ($5,000,000) or more entered by a court
or courts of competent jurisdiction against the Borrowers or either Borrower or
CarrAmerica LP (other than any judgment as to which, and only to the extent, a
reputable insurance company has acknowledged coverage of such claim in writing).
SECTION 4.8. Compliance with ERISA.
(a) Except as previously disclosed to the Lead Agent in writing, each
member of the ERISA Group has fulfilled its obligations under the minimum
funding standards of ERISA and the Internal Revenue Code with respect to each
Plan and is in compliance in all material respects with the presently applicable
provisions of ERISA and the Internal Revenue Code with respect to each Plan. No
member of the ERISA Group has (i) sought a waiver of the minimum funding
standard under Section 412 of the Internal Revenue Code in respect of any Plan,
(ii) failed to make any contribution or payment to any Plan or Multiemployer
Plan or in respect of any Benefit Arrangement, or made any amendment to any Plan
or Benefit Arrangement, which has resulted or could result in the imposition of
a Lien or the posting of a bond or other security under ERISA or the Internal
Revenue Code or (iii) incurred any liability under Title IV of ERISA other than
a liability to the PBGC for premiums under Section 4007 of ERISA.
(b) The transactions contemplated by the Loan Documents will not
constitute a nonexempt prohibited transaction
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(as such term is defined in Section 4975 of the Code or Section 406 of ERISA)
that could subject the Lead Agent or the Banks to any tax or penalty or
prohibited transactions imposed under Section 4975 of the Code or Section 502(i)
of ERISA.
SECTION 4.9. Environmental Matters. In the ordinary course of its
business, the Borrowers and CarrAmerica LP each review the effect of
Environmental Laws on the business, operations and properties of the Borrowers
and their subsidiaries or CarrAmerica LP, as applicable, in the course of which
they identify and evaluate associated liabilities and costs (including, without
limitation, any capital or operating expenditures required for clean-up or
closure of properties presently or previously owned, any capital or operating
expenditures required to achieve or maintain compliance with environmental
protection standards imposed by law or as a condition of any license, permit or
contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level of or
change in the nature of operations conducted thereat, any costs or liabilities
in connection with off-site disposal of wastes or Hazardous Substances, and any
actual or potential liabilities to third parties, including employees, and any
related costs and expenses). On the basis of this review, the Borrowers and
CarrAmerica LP have reasonably concluded that such associated liabilities and
costs, including the costs of compliance with Environmental Laws, are unlikely
to have a Material Adverse Effect.
SECTION 4.10. Taxes. The initial tax year of each Borrower for federal
income tax purposes was 1993. The initial tax year of CarrAmerica LP for federal
income tax purposes is 1996. The federal income tax returns of the Borrowers are
currently under examination by the Internal Revenue Service. Although such
examination is not yet formally closed, the examining agent has delivered his
report to the Borrowers and such report does not propose any adjustments in
respect of such returns that would have a Material Adverse Effect and the
Borrowers currently do not anticipate that the Internal Revenue Service will
propose any such adjustments. The Borrowers and their subsidiaries and
CarrAmerica LP have filed all United States Federal income tax returns and all
other material tax returns which are required to be filed by them and have paid
all taxes due
62
pursuant to such returns or pursuant to any assessment received by the Borrowers
or any subsidiary. The charges, accruals and reserves on the books of the
Borrowers and their subsidiaries and CarrAmerica LP in respect of taxes or other
governmental charges are, in the opinion of the Borrowers and CarrAmerica LP,
adequate.
SECTION 4.11. Full Disclosure. All information heretofore furnished by
the Borrowers or CarrAmerica LP to the Lead Agent or any Bank for purposes of or
in connection with this Agreement or any transaction contemplated hereby is true
and accurate in all material respects on the date as of which such information
is stated or certified. The Borrowers and CarrAmerica LP have disclosed to the
Banks in writing any and all facts known to the Borrowers or CarrAmerica LP
which materially and adversely affect or are likely to materially and adversely
affect (to the extent the Borrowers or CarrAmerica LP can now reasonably
foresee), the business, operations or financial condition of the Borrowers and
CarrAmerica LP considered as one enterprise or the ability of the Borrowers or
CarrAmerica LP, as applicable, to perform their obligations under this Agreement
or the other Loan Documents.
SECTION 4.12. Solvency. On the Closing Date and after giving effect to
the transactions contemplated by the Loan Documents occurring on the Closing
Date, each Borrower and CarrAmerica LP is Solvent.
SECTION 4.13. Use of Proceeds; Margin Regulations. All proceeds of the
Loans will be used by the Borrowers only in accordance with the provisions
hereof. No part of the proceeds of any Loan will be used by the Borrowers to
purchase or carry any Margin Stock or to extend credit to others for the purpose
of purchasing or carrying any Margin Stock. Neither the making of any Loan nor
the use of the proceeds thereof will violate or be inconsistent with the
provisions of Regulations G, T, U or X of the Federal Reserve Board.
SECTION 4.14. Governmental Approvals. No order, consent, approval,
license, authorization, or validation of, or filing, recording or registration
with, or exemption by, any governmental or public body or authority, or any
subdivision thereof, is required to authorize, or is required in connection with
the execution, delivery and performance of any
63
Loan Document or the consummation of any of the transactions contemplated
thereby other than those that have already been duly made or obtained and remain
in full force and effect.
SECTION 4.15. Investment Company Act; Public Utility Holding Company
Act. Neither Borrower nor CarrAmerica LP is (x) an "investment company" or a
company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended, (y) a "holding company" or a
"subsidiary company" of a "holding company" or an "affiliate" of either a
"holding company" or a "subsidiary company" within the meaning of the Public
Utility Holding Company Act of 1935, as amended, or (z) subject to any other
federal or state law or regulation which purports to restrict or regulate its
ability to borrow money.
SECTION 4.16. Closing Date Transactions. On the Closing Date and
immediately prior to the making of the Loans, the transactions (other than the
making of the Loans) intended to be consummated on the Closing Date will have
been consummated in accordance with all applicable laws. All consents and
approvals of, and filings and registrations with, and all other actions by, any
Person required in order to make or consummate such transactions have been
obtained, given, filed or taken and are in full force and effect.
SECTION 4.17. Representations and Warranties in Loan Documents. All
representations and warranties made by the Borrowers and CarrAmerica LP in the
Loan Documents are true and correct in all material respects.
SECTION 4.18. Patents, Trademarks, etc. Each Borrower and CarrAmerica LP
has obtained and holds in full force and effect all patents, trademarks, service
marks, trade names, copyrights and other such rights, free from burdensome
restrictions, which are necessary for the operation of its business as presently
conducted, the impairment of which is likely to have a Material Adverse Effect.
To the Borrowers' and CarrAmerica LP's knowledge, no material product, process,
method, substance, part or other material presently sold by or employed by the
Borrowers or CarrAmerica LP in connection with such business infringes any
patent, trademark, service xxxx, trade name, copyright, license or other such
right owned by any other Person. There is not pending or, to the Borrowers' and
CarrAmerica LP's knowledge, threatened any claim or litigation against or
affecting
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either Borrower or CarrAmerica LP contesting its right to sell or use any such
product, process, method, substance, part or other material.
SECTION 4.19. No Default. No Default or Event of Default exists under or
with respect to any Loan Document. Neither Borrower nor CarrAmerica LP is in
default in any material respect beyond any applicable grace period under or with
respect to any other material agreement, instrument or undertaking to which it
is a party or by which it or any of its property is bound in any respect, the
existence of which default is likely (to the extent that the Borrowers or
CarrAmerica LP, as applicable, can now reasonably foresee) to result in a
Material Adverse Effect.
SECTION 4.20. Licenses, etc. Each Borrower and CarrAmerica LP has
obtained and holds in full force and effect, all franchises, licenses, permits,
certificates, authorizations, qualifications, accreditations, easements, rights
of way and other consents and approvals which are necessary for the operation of
its businesses as presently conducted, the absence of which is likely (to the
extent that the Borrowers or CarrAmerica LP, as applicable, can now reasonably
foresee) to have a Material Adverse Effect.
SECTION 4.21. Compliance With Law. Each Borrower and CarrAmerica LP is
in compliance with all laws, rules, regulations, orders, judgments, writs and
decrees, including, without limitation, all building and zoning ordinances and
codes, the failure to comply with which is likely (to the extent that the
Borrowers or CarrAmerica LP, as applicable, can now reasonably foresee) to have
a Material Adverse Effect.
SECTION 4.22. No Burdensome Restrictions. Neither Borrower nor
CarrAmerica LP is a party to any agreement or instrument or subject to any other
obligation or any charter or corporate or partnership restriction, as the case
may be, which, individually or in the aggregate, is likely (to the extent that
the Borrowers or CarrAmerica LP, as applicable, can now reasonably foresee) to
have a Material Adverse Effect.
SECTION 4.23. Brokers' Fees. Neither Borrower nor CarrAmerica LP has
dealt with any broker or finder with respect to the transactions contemplated by
the Loan Documents
65
(except with respect to the acquisition or disposition of Real Property Assets)
or otherwise in connection with this Agreement, and neither Borrower nor
CarrAmerica LP has done any acts, had any negotiations or conversation, or made
any agreements or promises which will in any way create or give rise to any
obligation or liability for the payment by the Borrower or CarrAmerica LP of any
brokerage fee, charge, commission or other compensation to any party with
respect to the transactions contemplated by the Loan Documents (except with
respect to the acquisition or disposition of Real Property Assets), other than
the fees payable hereunder.
SECTION 4.24. Labor Matters. There are no collective bargaining
agreements or Multiemployer Plans covering the employees of the Borrowers or
CarrAmerica LP and the Borrowers or CarrAmerica LP have not suffered any
strikes, walkouts, work stoppages or other material labor difficulty within the
last five (5) years.
SECTION 4.25. Organizational Documents. The documents delivered pursuant
to Section 3.1(e) constitute, as of the Closing Date, all of the organizational
documents (together with all amendments and modifications thereof) of the
Borrowers. The Borrowers represent that they have delivered to the Lead Agent
true, correct and complete copies of each of the documents set forth in this
Section 4.25. CarrAmerica LP represents that it has delivered to the Lead Agent
and the Banks true, correct and complete copies of all of the organizational
documents (together with all amendments and modifications thereof) of
CarrAmerica LP as of the Closing Date.
SECTION 4.26. Principal Offices. The principal office, chief executive
office and principal place of business of each of the Borrowers and CarrAmerica
LP is 0000 Xxxxxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X.
SECTION 4.27. REIT Status. For the fiscal year ended December 31, 1995,
Xxxx qualified and Xxxx intends to continue to qualify as a real estate
investment trust under the Code.
SECTION 4.28. Ownership of Property. Schedule 4.28 attached hereto and
made a part hereof sets forth all the real property owned or leased by the
Borrowers and Persons
66
in which the Borrowers, directly or indirectly, own an interest as of the
Closing Date. As of the Closing Date, each Borrower and such Persons have good
and insurable fee simple title (or leasehold title if so designated on Schedule
4.28) to all of such real property, subject to customary encumbrances and liens
as of the date of this Agreement. As of the date of this Agreement, there are no
mortgages, deeds of trust, indentures, debt instruments or other agreements
creating a Lien against any of the Real Property Assets except as disclosed on
Schedule 4.28.
SECTION 4.29. Insurance. Each Borrower and CarrAmerica LP
currently maintains, or causes its tenants to maintain, insurance at 100%
replacement cost insurance coverage (subject to customary deductibles) in
respect of each of the Real Property Assets, as well as commercial general
liability insurance (including "builders' risk") against claims for personal,
and bodily injury and/or death, to one or more persons, or property damage, as
well as workers' compensation insurance, in each case with respect to the Real
Property Assets with insurers having an A.M. Best policyholders' rating of not
less than A-IX in amounts that prudent owner of assets such as the Real Property
Assets would maintain.
SECTION 4.30. Surveys. As to any Survey dated prior to June 30,
1995, neither the Borrowers nor CarrAmerica LP know of any material changes to
the matters shown thereon which have occurred since the date of each such Survey
and which have not been disclosed by the Borrowers or CarrAmerica LP in writing
to the Lead Agent.
ARTICLE V
AFFIRMATIVE AND NEGATIVE COVENANTS
Each Borrower and CarrAmerica LP covenant and agree that, so long as any
Bank has any Commitment hereunder or any Obligations remain unpaid:
SECTION 5.1. Information. The applicable Borrower will deliver to the
Lead Agent and to each of the Banks:
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(a) as soon as available and in any event within 105 days after the end
of each fiscal year of Xxxx, an audited consolidated balance sheet of Xxxx as of
the end of such fiscal year and the related consolidated statements of cash flow
and operations for such fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, audited by KPMG Peat Marwick LLP
or other independent public accountants of similar standing;
(b) as soon as available and in any event within ninety (90) days after
the end of each quarter of each fiscal year of Xxxx, a statement of Xxxx,
prepared on a GAAP basis, setting forth the operating income and operating
expenses of Xxxx, in sufficient detail so as to calculate net operating cash
flow of Xxxx for the immediately preceding quarter;
(c) simultaneously with the delivery of each set of financial statements
referred to in clauses (a) and (b) above, a certificate of the chief financial
officer or the chief accounting officer of Xxxx (i) setting forth in reasonable
detail the calculations required to establish whether the Borrowers were in
compliance with the requirements of Section 5.8 on the date of such financial
statements; (ii) stating whether any Default exists on the date of such
certificate and, if any Default then exists, setting forth the details thereof
and the action which the applicable Borrower or CarrAmerica LP is taking or
proposes to take with respect thereto; and (iii) certifying (x) that such
financial statements fairly present the financial condition and the results of
operations of Xxxx as of the dates and for the periods indicated, on the basis
of generally accepted accounting principles, subject, in the case of interim
financial statements, to normal year-end adjustments, and (y) that such officer
has reviewed the terms of the Loan Documents and has made, or caused to be made
under his or her supervision, a review in reasonable detail of the business and
condition of the applicable Borrower or CarrAmerica LP during the period
beginning on the date through which the last such review was made pursuant to
this Section 5.1(c) (or, in the case of the first certification pursuant to this
Section 5.1(c), the Closing Date) and ending on a date not more than ten (10)
Domestic Business Days prior to the date of such delivery and that on the basis
of such review of the Loan Documents and the business and condition of the
applicable Borrower or CarrAmerica LP, to the best knowledge of
68
such officer, no Default or Event of Default under any other provision of
Section 6.1 occurred or, if any such Default or Event of Default has occurred,
specifying the nature and extent thereof and, if continuing, the action the
applicable Borrower or CarrAmerica LP proposes to take in respect thereof;
(d) simultaneously with the delivery of each set of financial statements
referred to in clause (a) above, a statement of the firm of independent public
accountants which reported on such statements confirming the calculations set
forth in the officer's certificate delivered simultaneously therewith pursuant
to clause (c) above;
(e) (i) within five (5) days after the president, chief financial
officer, treasurer, controller or other executive officer of either Borrower or
CarrAmerica LP obtains knowledge of any Default, if such Default is then
continuing, a certificate of the chief financial officer or the president of
such Borrower or CarrAmerica LP setting forth the details thereof and the action
which such Borrower or CarrAmerica LP is taking or proposes to take with respect
thereto; (ii) promptly and in any event within ten (10) days after either
Borrower or CarrAmerica LP obtains knowledge thereof, notice of (x) any
litigation or governmental proceeding pending or threatened against the Borrower
or CarrAmerica LP, as applicable, as to which, if adversely determined, is
likely to individually or in the aggregate, result in a Material Adverse Effect,
and (y) any other event, act or condition which is likely to result in a
Material Adverse Effect;
(f) if and when any member of the ERISA Group (i) gives or is required
to give notice to the PBGC of any "reportable event" (as defined in Section 4043
of ERISA) with respect to any Plan which might constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or
69
appoint a trustee to administer any Plan, a copy of such notice; (iv) applies
for a waiver of the minimum funding standard under Section 412 of the Internal
Revenue Code, a copy of such application; (v) gives notice of intent to
terminate any Plan under Section 4041(c) of ERISA, a copy of such notice and
other information filed with the PBGC; (vi) gives notice of withdrawal from any
Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails to
make any payment or contribution to any Plan or Multiemployer Plan or in respect
of any Benefit Arrangement or makes any amendment to any Plan or Benefit
Arrangement which has resulted or could result in the imposition of a Lien or
the posting of a bond or other security, a certificate of the chief financial
officer or the chief accounting officer of such Borrower or CarrAmerica LP
setting forth details as to such occurrence and action, if any, which such
Borrower, CarrAmerica LP or applicable member of the ERISA Group is required or
proposes to take;
(g) promptly and in any event within five (5) Domestic Business Days
after either Borrower or CarrAmerica LP obtains actual knowledge of any of the
following events, a certificate of the applicable Borrower or CarrAmerica LP,
executed by an officer of the applicable Borrower or CarrAmerica LP, specifying
the nature of such condition and such Borrower's or CarrAmerica LP's, if the
applicable Borrower or CarrAmerica LP, as the case may be, has actual knowledge
thereof, the Environmental Affiliate's proposed initial response thereto: (i)
the receipt by the applicable Borrower or CarrAmerica LP, or, if such Borrower
or CarrAmerica LP has actual knowledge thereof, any of the Environmental
Affiliates, of any communication (written or oral), whether from a governmental
authority, citizens group, employee or otherwise, that alleges that the
applicable Borrower or CarrAmerica LP, or, if the applicable Borrower or
CarrAmerica LP has actual knowledge thereof, any of the Environmental
Affiliates, is not in compliance with applicable Environmental Laws, and such
noncompliance is likely to have a Material Adverse Effect, (ii) the applicable
Borrower or CarrAmerica LP shall obtain actual knowledge that there exists any
Environmental Claim pending or threatened against the applicable Borrower,
CarrAmerica LP or any Environmental Affiliate or (iii) the applicable Borrower
obtains actual knowledge of any release, emission, discharge or disposal of any
Materials of Environmental Concern that are likely to form the basis of any
Environmental Claim
70
against the applicable Borrower, CarrAmerica LP or any Environmental Affiliate;
(h) promptly and in any event within five (5) Domestic Business Days
after receipt of any material notices or correspondence from any company or
agent for any company providing insurance coverage to either Borrower or
CarrAmerica LP relating to any material loss or loss in excess of $1,500,000 of
the applicable Borrower or CarrAmerica LP, copies of such notices and
correspondence; and
(i) promptly upon the mailing thereof to the shareholders or partners of
either Borrower or CarrAmerica LP, copies of all financial statements, reports
and proxy statement so mailed;
(j) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements on
Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their
equivalents) which either Borrower or CarrAmerica LP shall have filed with the
Securities and Exchange Commission;
(k) simultaneously with delivery of the certificate required pursuant to
Section 5.1(c), an updated Schedule 4.28, certified by the chief financial
officer or any senior vice president or executive vice president of Xxxx as
true, correct and complete as of the date such updated schedules are delivered;
(l) within 5 days after filing of the annual income tax return with the
Internal Revenue Service, a certificate of the chief financial officer or chief
accounting officer of Xxxx certifying that Xxxx is properly classified and
continues to qualify as a real estate investment trust under the Internal
Revenue Code and has taken all actions consistent with maintaining such status;
(m) simultaneously with delivery of the information required by Sections
5.1(a) and (b), a statement of Borrowing Base Net Operating Cash Flow with
respect to each Borrowing Base Property and a list of all Borrowing Base
Properties; and
71
(n) from time to time such additional information regarding the
financial position or business of the Borrowers as the Lead Agent, at the
request of any Bank, may reasonably request.
SECTION 5.2. Payment of Obligations. Each Borrower and CarrAmerica LP
will pay and discharge, at or before maturity, all its material obligations and
liabilities including, without limitation, any obligation pursuant to any
agreement by which it or any of its properties is bound and any tax liabilities,
except where such tax liabilities may be contested in good faith by appropriate
proceedings, and will maintain in accordance with generally accepted accounting
principles, appropriate reserves for the accrual of any of the same, in any
case, where failure to do so will likely result in a Material Adverse Effect.
SECTION 5.3. Maintenance of Property; Insurance.
(a) Each Borrower and CarrAmerica LP will keep, and will cause each of
its Subsidiaries to keep, all property useful and necessary in its business,
including, without limitation, the Real Property Assets, in good repair, working
order and condition, ordinary wear and tear and the provisions of any mortgage
with respect to casualty or condemnation events excepted.
(b) Each Borrower and CarrAmerica LP shall or shall cause the
Subsidiaries to maintain "all risk" insurance covering 100% replacement cost of
its real property assets with insurers having an A.M. Best policyholder's rating
of not less than A-VIII, which insurance shall in any event not provide for
materially less coverage than the insurance in effect on the Closing Date, and
furnish to each Bank from time to time, upon written request, copies of
certificates of insurance under which such insurance is issued and such other
information relating to such insurance as such Bank may reasonably request.
SECTION 5.4. Conduct of Business. Except as contemplated by the Proxy
Statement of Xxxx, dated January 22, 1996, each Borrower and CarrAmerica LP will
continue to engage in business of the same general type as now conducted by each
Borrower and CarrAmerica LP, as the case may be.
72
SECTION 5.5. Compliance with Laws. Each Borrower and CarrAmerica LP will
comply in all material respects with all applicable laws, ordinances, rules,
regulations, and requirements of governmental authorities (including, without
limitation, Environmental Laws, all zoning and building codes and ERISA and the
rules and regulations thereunder) except where the necessity of compliance
therewith is contested in good faith by appropriate proceedings.
SECTION 5.6. Inspection of Property, Books and Records. The Borrowers
and CarrAmerica LP will keep proper books of record and account in which full,
true and correct entries shall be made of all dealings and transactions in
relation to its business and activities; and will permit representatives of any
Bank at such Bank's expense to visit and inspect any of its properties to
examine and make abstracts from any of its books and records and to discuss its
affairs, finances and accounts with its officers, employees and independent
public accountants, all at such reasonable times, upon reasonable notice, and as
often as may reasonably be desired.
SECTION 5.7. Existence.
(a) Each Borrower and CarrAmerica LP shall do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence or its partnership existence, as applicable.
(b) Each Borrower and CarrAmerica LP shall do or cause to be
done all things necessary to preserve and keep in full force and effect its
patents, trademarks, servicemarks, tradenames, copyrights, franchises, licenses,
permits, certificates, authorizations, qualifications, accreditations,
easements, rights of way and other rights, consents and approvals the
nonexistence of which is likely to have a Material Adverse Effect.
SECTION 5.8. Financial Covenants.
(a) Debt Service Coverage. Measured as of the last day of each
calendar quarter, the ratio of (i) Annual EBITDA to (ii) the sum of (x) Debt
Service plus (y) appropriate reserves for replacements of not less than $2.29
per square foot per annum for each Real Property Asset, will not be less than
1.5:1.
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(b) Maximum Total Debt to Tangible FMV. As of the last day of
each calendar quarter, the Maximum Total Debt Ratio will not be greater than 55%
during the calendar year 1996, 50% during the calendar year 1997 and 45% during
the calendar year 1998.
(c) Xxxx Maximum Total Debt to Xxxx Tangible FMV. As of the last
day of each calendar quarter, the Xxxx Maxi- mum Total Debt Ratio will not be
greater than 60%.
(d) Xxxx XX Maximum Total Debt to Xxxx XX Tangible FMV. As of
the last day of each calendar quarter, the Xxxx XX Maximum Total Debt Ratio will
not be greater than 60%.
(e) EBITDA Interest Coverage. As of the last day of each
calendar quarter, the ratio of (x) Annual EBITDA to (y) interest (whether
accrued, paid or capitalized) actually payable by either Borrower or the
Borrowers on its Debt for the previous four consecutive quarters including the
quarter then ended, will not be less than 2.25:1.
(f) EBITDA Coverage. As of the last day of each calendar
quarter, the ratio of (x) Annual EBITDA to (y) the sum of (i) Debt Service plus
(ii) Capital Expenditures of the Borrowers for the previous four consecutive
quarters including the quarter then ended less a reserve of $20,000,000 for the
period commencing on the date hereof and ending on the first anniversary of the
date hereof, will not be less than 1.25:1.
(g) Dividends. Xxxx will not, as determined on an aggregate
annual basis, pay any dividends in excess of 90% of Xxxx'x consolidated FFO for
such year. During the continuance of an Event of Default under Section 6.1(a),
Xxxx shall only pay those dividends necessary to maintain its status as a real
estate investment trust.
(h) Borrowers LTV Ratio. As of the last day of each calendar
quarter and as of the date of any New Acquisition, the Borrowers LTV Ratio shall
not exceed 50%, subject, however, to the Borrowers' rights to cure pursuant to
Section 2.9(a). Failure to restore compliance with this Section 5.8(h) in
accordance with Section 2.9(a) shall be an immediate Event of Default.
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(i) Xxxx LTV Ratio. As of the last day of each calendar quarter
and as of the date of any New Acquisition, the Xxxx LTV Ratio shall not exceed
50%, subject, however, to Xxxx'x rights to cure pursuant to Section 2.9(d).
Failure to restore compliance with this Section 5.8(i) in accordance with
Section 2.9(d) shall be an immediate Event of Default.
(j) Xxxx XX LTV Ratio. As of the last day of each calendar
quarter and as of the date of any New Acquisition, the Xxxx XX LTV Ratio shall
not exceed 50%, subject, however, to Xxxx LP's rights to cure pursuant to
Section 2.9(e). Failure to restore compliance with this Section 5.8(j) in
accordance with Section 2.9(e) shall be an immediate Event of Default.
(k) Borrowing Base Properties Minimum Debt Service Coverage. As
of the last day of each calendar quarter, the Borrowers shall be in compliance
with the Borrowing Base Properties Minimum Debt Service Coverage, subject,
however, to the Borrowers' rights to cure pursuant to Section 2.9(c).
Failure to restore compliance with this Section 5.8(k) in accordance with
Section 2.9(c) shall be an immediate Event of Default.
(l) Minimum Consolidated Tangible Net Worth. The Consolidated
Tangible Net Worth will at no time be less than 90% of the Consolidated Tangible
Net Worth on the Closing Date.
SECTION 5.9. Restriction on Fundamental Changes; Operation and Control.
(a) Xxxx shall carry on its business operations through Xxxx and its
Subsidiaries. Neither Borrower nor CarrAmerica LP shall enter into any merger or
consolidation, unless such Borrower or CarrAmerica LP, as applicable, is the
surviving entity, or liquidate, wind-up or dissolve (or suffer any liquidation
or dissolution), discontinue its business or convey, lease, sell, transfer or
otherwise dispose of, in one transaction or series of transactions, all or any
substantial part of its business or property, whether now or hereafter acquired,
hold an interest in any subsidiary which is not controlled by such Borrower or
CarrAmerica LP, as applicable, or enter into other business lines, without the
prior written consent of the Lead Agent, except for (i) joint ventures in which
Xxxx'x
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ownership interest shall be less than 15% of the fair market value of the Real
Property Assets owned by Xxxx as of the date hereof and (ii) Xxxx Real Estate
Services, Inc., Xxxx Real Estate Services of Northern Virginia, Inc., Xxxx
Development and Construction, Inc. and any other similar service company. For
purposes hereof, "fair market value" shall mean the quotient of (x) Net
Operating Income with respect to the Real Property Assets owned by Xxxx as of
the date hereof and (y) 11%.
(b) Neither Borrower nor CarrAmerica LP shall amend its articles of
incorporation, by-laws or agreement of limited partnership, as applicable, in
any material respect, without the Lead Agent's consent, which shall not be
unreasonably withheld, except as contemplated by the Proxy Statement of Xxxx,
dated January 22, 1996.
SECTION 5.10. Changes in Business. The Borrowers and CarrAmerica LP
shall not enter into any business which is substantially different from that
conducted by the Borrowers and CarrAmerica LP on the Closing Date after giving
effect to the transactions contemplated by the Loan Documents or described in
the Proxy Statement of Xxxx, dated January 22, 1996.
SECTION 5.11. Fiscal Year; Fiscal Quarter. The Borrowers and
CarrAmerica LP shall not change their fiscal year or any of their fiscal
quarters.
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SECTION 5.12. Margin Stock. None of the proceeds of the Loan will be
used, directly or indirectly, for the purpose, whether immediate, incidental
or ultimate, of buying or carrying any Margin Stock.
SECTION 5.13. Sale of Borrowing Base Properties. Prior to the sale or
transfer of any Borrowing Base Property, the applicable Borrower shall (i)
deliver prior written notice to the Lead Agent and the Banks, (ii) deliver to
the Lead Agent and the Banks a certificate from its Chief Financial Officer
certifying that at the time of such sale or other disposal (based on pro-forma
calculations for the previous period assuming that such Borrowing Base Property
was not a Borrowing Base Property for the relevant period) all of the covenants
contained in Sections 5.8 through 5.14 and 5.16 through 5.21 are and after
giving effect to the transaction shall continue to be true and accurate in all
respects, and (iii) pay to the Lead Agent an amount equal to that required
pursuant to Section 2.9(b).
SECTION 5.14. Liens; Release of Liens. Neither Borrower nor any of their
Subsidiaries shall at any time during the Term directly or indirectly create,
incur, assume or permit to exist any Lien for borrowed monies or any other Lien
other than Permitted Liens unless the same is being contested in good faith and
the same is discharged, bonded off or paid within thirty (30) days of filing of
such Lien, on or with respect to any Borrowing Base Property. Notwithstanding
the foregoing, the Borrowers may obtain a release from the terms of this
Agreement of any Borrowing Base Property provided that such Borrower has
complied with Section 2.9(b) and prior to or simultaneously with such release
(i) such Borrower shall pay to the Lead Agent any amounts due pursuant to
Section 2.9(b), and (ii) such Borrower delivers to the Lead Agent and the Banks
a certificate from its Chief Financial Officer certifying that at the time of
the release all of the covenants contained in Sections 5.8 through 5.14 and 5.16
through 5.21 are and after giving effect to the transaction shall continue to be
true and accurate in all respects.
SECTION 5.15 Use of Proceeds. The Borrowers and CarrAmerica LP shall use
the proceeds of the Loans solely (i) to facilitate the acquisition by Xxxx
(either directly or indirectly through Subsidiaries) of real properties (or
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interests therein) (the "New Acquisitions") which are office buildings (it being
understood that Xxxx XX may distribute, lend or otherwise transfer the proceeds
of a Tranche B Loan to Xxxx for such purpose, and that Xxxx may distribute, lend
or otherwise transfer the proceeds of a Tranche A Loan (or the proceeds of a
Tranche B Loan received from Xxxx XX) to a Subsidiary for such purpose), (ii)
for other purposes related to the acquisition of office buildings (including,
without limitation, the acquisition of property service companies in connection
therewith and the payment of fees and other costs related to such acquisition),
(iii) for working capital purposes, provided, however, the Outstanding Working
Capital Amount shall not exceed $15,000,000 at any one time or (iv) for
development and construction activities in accordance with Section 5.16 hereof.
Notwithstanding the foregoing, the Borrowers may use $20,000,000 of the proceeds
of the Loans only for the payment of Capital Expenditures.
SECTION 5.16 Development Activities. Neither the Borrowers nor
CarrAmerica LP shall have invested more than $25,000,000 in the aggregate as to
all such Persons in any current development and construction activities (which
limit shall be increased to $50,000,000 in the aggregate as to all such Persons
on the date which Xxxx shall have raised additional gross proceeds of at least
$150,000,000 in private or public equity capital after May 23, 1996), other than
(i) development of "build-to-suit" improvements pre-leased to the tenant (in
connection with which the Borrowers and CarrAmerica LP shall have no
construction completion risk) or (ii) development in connection with the
expansion and/or repositioning or restoration following a casualty or
condemnation of existing improvements on Real Property Assets.
SECTION 5.17 Restrictions on Recourse Debt. Until such time as Xxxx
shall receive two (2) Investment Grade Ratings, one of which shall be an
Investment Grade Rating from S&P or Xxxxx'x, neither Borrower nor CarrAmerica LP
shall incur any additional Recourse Debt, other than (i) Recourse Debt to any
Subsidiary, (ii) Recourse Debt in an amount outstanding at any one time not to
exceed $5,000,000 and (iii) the assumption of $28,300,000 of Recourse Debt in
connection with Xxxx'x planned acquisition of office properties located in
Redmond, Washington. Notwithstanding the foregoing, the Borrowers shall be
permitted to incur Non-Recourse Debt with respect to any Real Property Asset
which (i) has been released as a Borrowing Base Property in accordance with the
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terms of this Agreement or (ii) is not otherwise included in the Borrowing Base
Properties.
SECTION 5.18. Xxxx'x Status. Xxxx shall at all times (i) remain a
publicly traded company listed on the New York Stock Exchange, and (ii) maintain
its status as a self-directed and self-administered real estate investment
trust under the Internal Revenue Code.
SECTION 5.19 Certain Requirements for the Borrowing Base Properties. At
all times, (i) the Borrowing Base Properties Value of the Borrowing Base
Properties which are less than 85% leased to tenants (including as leased any
space for which a lease termination payment has been made to either Borrower or
CarrAmerica LP but only for the period for which such payment shall cover the
rental income for such space) shall not comprise more than 20% of the Borrowing
Base Properties Value. In the event that the requirements of this Section 5.19
are not satisfied, the Borrowers and CarrAmerica LP shall be prohibited from
further Borrowings unless such Borrower or CarrAmerica LP adds a New Acquisition
or Real Property Asset to the Borrowing Base Properties in accordance with this
Agreement in order to restore compliance with the requirements of this
provision. Failure to restore compliance with the requirements of this Section
5.19 within 90 days of such non-compliance shall be an Event of Default.
SECTION 5.20 Hedging Requirements. The Borrowers and CarrAmerica LP
shall maintain "Interest Rate Xxxxxx" (as defined below) on a notional amount of
the Debt of the Borrowers and CarrAmerica LP and their Subsidiaries which, when
added to the aggregate principal amount of the Debt of the Borrowers,
CarrAmerica LP and their Subsidiaries which bears interest at a fixed rate,
equals or exceeds 75% of the aggregate principal amount of all Debt of the
Borrowers and CarrAmerica LP and their Subsidiaries. "Interest Rate Xxxxxx"
shall mean interest rate exchange, collar, cap, swap, adjustable strike cap,
adjustable strike corridor or similar agreements having terms, conditions and
tenors reasonably acceptable to the Lead Agent entered into by the Borrowers
and/or CarrAmerica LP and/or their Subsidiaries in order to provide protection
to, or minimize the impact upon, the Borrowers and/or CarrAmerica LP and/or such
Subsidiaries of increasing floating rates of interest applicable to Debt.
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SECTION 5.21. Transfer of Real Property Assets. Neither Xxxx nor
CarrAmerica LP shall transfer its interest or any portion of any interest in any
Real Property Asset to Xxxx XX.
SECTION 5.22. CarrAmerica Realty GP Holdings, Inc. Xxxx hereby covenants
that at all times CarrAmerica Realty GP Holdings, Inc. shall remain a
wholly-owned Subsidiary of Xxxx.
ARTICLE VI
DEFAULTS
SECTION 6.1. Events of Default. If one or more of the following events
("Events of Default") shall have occurred and be continuing:
(a) either Borrower or CarrAmerica LP shall fail to pay when due any
principal of any Loan, or either Borrower or CarrAmerica LP shall fail to pay
when due any interest on any Loan, provided, however, that a Borrower shall be
entitled to a three (3) Domestic Business Day grace period with respect thereto
but only as to two (2) payments of interest during the Term, or either Borrower
or CarrAmerica LP shall fail to pay within three (3) Domestic Business Days
after the same is due any fees or other amounts payable hereunder;
(b) either Borrower or CarrAmerica LP shall fail to observe or perform
any covenant contained in Sections 5.7(a), 5.8 to 5.19, inclusive, or 5.21,
subject to any applicable grace periods set forth therein;
(c) either Borrower or CarrAmerica LP shall fail to observe or perform
any covenant or agreement contained in this Agreement (other than those covered
by clause (a) or (b) above) for 30 days after written notice thereof has been
given to such Borrower or CarrAmerica LP by the Lead Agent;
(d) any representation, warranty, certification or statement made by
either Borrower or CarrAmerica LP in this Agreement or in any certificate,
financial statement or other document delivered pursuant to this Agreement shall
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prove to have been incorrect in any material respect when made (or deemed made);
(e) Either Borrower or CarrAmerica LP shall default in the payment when
due (whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) of any amount owing in respect of any Recourse Debt or Debt
guaranteed by such party (other than the Obligations and provided that such Debt
is in an aggregate amount of Five Million Dollars ($5,000,000) or more) and such
default shall continue beyond the giving of any required notice and the
expiration of any applicable grace period (as the same may be extended by the
applicable lender) and such default shall not be waived by the applicable lender
(which waiver shall serve to reinstate the applicable loan), or either Borrower
or CarrAmerica LP shall default in the performance or observance of any
obligation or condition with respect to any such Debt or any other event shall
occur or condition exist beyond the giving of any required notice and the
expiration of any applicable grace period (as the same may be extended by the
applicable lender), if in any such case the effect of such default, event or
condition is to accelerate the maturity of any such Debt or to permit (without
any further requirement of notice or lapse of time) the holder or holders
thereof, or any trustee or agent for such holders, to accelerate the maturity of
any such Debt and such default shall not be waived by the applicable lender
(which waiver shall serve to reinstate the applicable loan), or any such Debt
shall become or be declared to be due and payable prior to its stated maturity
other than as a result of a regularly scheduled payment;
(f) either Borrower or CarrAmerica LP shall commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing;
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(g) an involuntary case or other proceeding shall be commenced against
either Borrower or CarrAmerica LP seeking liquidation, reorganization or other
relief with respect to it or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against either Borrower under the federal bankruptcy
laws as now or hereafter in effect;
(h) either Borrower or CarrAmerica LP shall default in its obligations
under any Loan Document other than this Agreement beyond any applicable notice
and grace periods;
(i) any member of the ERISA Group shall fail to pay when due an amount
or amounts aggregating in excess of $1,000,000 which it shall have become liable
to pay under Title IV of ERISA, or notice of intent to terminate a Material Plan
shall be filed under Title IV of ERISA by any member of the ERISA Group, any
plan administrator or any combination of the foregoing, or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or to cause
a trustee to be appointed to administer any Material Plan, or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated, or there shall occur a
complete or partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause one or more members of the ERISA Group to incur a current payment
obligation in excess of $1,000,000;
(j) one or more final nonappealable judgments or decrees in an aggregate
amount of six percent (6%) or more of the Consolidated Tangible Net Worth as of
such date shall be entered by a court or courts of competent jurisdiction
against either Borrower or CarrAmerica LP (other than any judgment as to which,
and only to the extent, a reputable insurance company has acknowledged coverage
of such claim in writing) and (i) any such judgments or decrees shall not be
stayed, discharged, paid, bonded or vacated within thirty
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(30) days or (ii) enforcement proceedings shall be commenced by any creditor on
any such judgments or decrees;
(k) (i) any Environmental Claim shall have been asserted against either
Borrower, CarrAmerica LP or any Environmental Affiliate, (ii) any release,
emission, discharge or disposal of any Materials of Environmental Concern shall
have occurred, and such event is reasonably likely to form the basis of an
Environmental Claim against either Borrower, CarrAmerica LP or any Environmental
Affiliate, or (iii) either Borrower, CarrAmerica LP or the Environmental
Affiliates shall have failed to obtain any Environmental Approval necessary for
the ownership, or operation of its business, property or assets or any such
Environmental Approval shall be revoked, terminated, or otherwise cease to be in
full force and effect, in the case of clauses (i), (ii) or (iii) above, if the
existence of such condition has had or is reasonably likely to have a Material
Adverse Effect;
(l) during any consecutive two year period commencing on or after the
date hereof, individuals who at the beginning of such period constituted the
Board of Directors of Xxxx (together with any new directors whose election by
the Board of Directors or whose nomination for election by Xxxx stockholders was
approved by a vote of at least a majority of the members of the Board of
Directors then in the office who either were members of the Board of Directors
at the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
members of the Board of Directors then in office; or
(k) Xxxx shall cease at any time to qualify as a real estate investment
trust under the Internal Revenue Code.
SECTION 6.2. Rights and Remedies. (a) Upon the occurrence of any Event
of Default described in Sections 6.1(f) or (g), the unpaid principal amount of,
and any and all accrued interest on, the Loans and any and all accrued fees and
other Obligations hereunder shall automatically become immediately due and
payable, with all additional interest from time to time accrued thereon and
without presentation, demand, or protest or other requirements of any kind
(including, without limitation, valuation and ap- praisement, diligence,
presentment, notice of intent to
83
demand or accelerate and notice of acceleration), all of which are hereby
expressly waived by the Borrowers and CarrAmerica LP; and upon the occurrence
and during the continuance of any other Event of Default, the Lead Agent may
exercise any of its rights and remedies hereunder and by written notice to the
Borrowers, declare the unpaid principal amount of and any and all accrued and
unpaid interest on the Loans and any and all accrued fees and other Obligations
hereunder to be, and the same shall thereupon be, immediately due and payable
with all additional interest from time to time accrued thereon and without
presentation, demand, or protest or other requirements of any kind other than as
provided in the Loan Documents (including, without limitation, valuation and
appraisement, diligence, presentment, and notice of intent to demand or
accelerate), all of which are hereby expressly waived by the Borrowers and
CarrAmerica LP. Notwithstanding anything contained in this Agreement to the
contrary, (i) Xxxx and CarrAmerica LP shall be jointly and severally liable for
all Obligations arising hereunder in connection with the Tranche A Loans, (ii)
Xxxx and Xxxx XX shall be jointly and severally liable for all Obligations
arising hereunder in connection with the Tranche B Loans and (iii) Xxxx XX shall
not be liable for any Borrowings made by Xxxx or CarrAmerica LP pursuant to the
terms hereof.
(b) Notwithstanding the foregoing, upon the occurrence and
during the continuance of any Event of Default other than any Event of Default
described in Sections 6.1(f) or (g), the Lead Agent shall not exercise any of
its rights and remedies hereunder nor declare the unpaid principal amount of and
any and all accrued and unpaid interest on the Loans and any and all accrued
fees and other Obligations hereunder to be immediately due and payable, until
such time as the Lead Agent shall have delivered a notice to the Banks
specifying the Event of Default which has occurred and whether Lead Agent
recommends the acceleration of the Obligations due hereunder or the exercise of
other remedies hereunder. The Banks shall notify the Lead Agent if they approve
or disapprove of the acceleration of the Obligations due hereunder or the
exercise of such other remedy recommended by Lead Agent within five (5) Domestic
Business Days after receipt of such notice. If any Bank shall not respond within
such five (5) Domestic Business Day period, then such Bank shall be deemed to
have accepted Lead Agent's recommendation for acceleration of the Obligations
due hereunder
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or the exercise of such other remedy. If the Required Banks shall approve the
acceleration of the Obligations due hereunder or the exercise of such other
remedy, then Lead Agent shall declare the unpaid principal amount of and any and
all accrued and unpaid interest on the Loans and any and all accrued fees and
other Obligations hereunder to be immediately due and payable or exercise such
other remedy approved by the Required Banks. If the Required Banks shall neither
approve nor disapprove the acceleration of the Obligations due hereunder or such
other remedy recommended by Lead Agent, then Lead Agent may accelerate the
Obligations due hereunder or exercise any of its rights and remedies hereunder
in its sole discretion. If the Required Banks shall disapprove the acceleration
of the Obligations due hereunder or the exercise of such other remedy
recommended by Lead Agent, but approve of another remedy, then to the extent
permitted hereunder, Lead Agent shall exercise such remedy.
SECTION 6.3. Notice of Default. If the Lead Agent shall not already have
given any notice to the Borrowers under Section 6.1, the Lead Agent shall give
notice to the Borrowers under Section 6.1 promptly upon being requested to do so
by the Required Banks and shall thereupon notify all the Banks thereof.
SECTION 6.4. Actions in Respect of Letters of Credit. (a) If, at any
time and from time to time, any Letter of Credit shall have been issued
hereunder and an Event of Default shall have occurred and be continuing, then,
upon the occurrence and during the continuation thereof, the Lead Agent may,
whether in addition to the taking by the Lead Agent of any of the actions
described in this Article or otherwise, make a demand upon the Borrowers to, and
forthwith upon such demand (but in any event within ten (10) days after such
demand), the Borrowers and/or CarrAmerica LP shall, pay to the Lead Agent, on
behalf of the Banks, in same day funds at the Lead Agent's office designated in
such demand, for deposit in a special cash collateral account (the "Letter of
Credit Collateral Account") to be maintained in the name of the Lead Agent (on
behalf of the Banks) and under its sole dominion and control at such place as
shall be designated by the Lead Agent, an amount equal to the amount of the
Letter of Credit Usage under the Letters of Credit. Interest shall accrue on the
Letter of Credit Collateral Account at a rate equal to the rate on overnight
funds.
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(b) The Borrowers and CarrAmerica LP hereby pledge, assign and grant to
the Lead Agent, as administrative agent for its benefit and the ratable benefit
of the Banks a lien on and a security interest in, the following collateral (the
"Letter of Credit Collateral"):
(i) the Letter of Credit Collateral Account, all cash
deposited therein and all certificates and instruments, if any, from time to
time representing or evidencing the Letter of Credit Collateral Account;
(ii) all notes, certificates of deposit and other
instruments from time to time hereafter delivered to or otherwise possessed by
the Lead Agent for or on behalf of either Borrower or CarrAmerica LP in
substitution for or in respect of any or all of the then existing Letter of
Credit Collateral;
(iii) all interest, dividends, cash, instru- ments and
other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of the then existing Letter of
Credit Collateral; and
(iv) to the extent not covered by the above clauses, all
proceeds of any or all of the foregoing Letter of Credit Collateral.
The lien and security interest granted hereby secures the payment of all
obligations of the Borrowers and CarrAmerica LP now or hereafter existing
hereunder and under any other Loan Document.
(c) The Borrowers and CarrAmerica LP hereby authorize the Lead Agent for
the ratable benefit of the Banks to apply, from time to time after funds are
deposited in the Letter of Credit Collateral Account, funds then held in the
Letter of Credit Collateral Account to the payment of any amounts, in such order
as the Lead Agent may elect, as shall have become due and payable by the
Borrowers and CarrAmerica LP to the Banks in respect of the Letters of Credit.
(d) Neither Borrower, CarrAmerica LP nor any Person claiming or acting
on behalf of or through either Borrower or CarrAmerica LP shall have any right
to withdraw any of
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the funds held in the Letter of Credit Collateral Account, except as provided in
Section 6.4(h) hereof.
(e) Each Borrower and CarrAmerica LP agrees that it will not (i) sell or
otherwise dispose of any interest in the Letter of Credit Collateral or (ii)
create or permit to exist any lien, security interest or other charge or
encumbrance upon or with respect to any of the Letter of Credit Collateral,
except for the security interest created by this Section 6.4.
(f) If any Event of Default shall have occurred and be continuing:
(i) The Lead Agent may, in its sole discretion, without notice
to the Borrowers or CarrAmerica LP except as required by law and at any time
from time to time, charge, set off or otherwise apply all or any part of first,
(x) amounts previously drawn on any Letter of Credit that have not been
reimbursed by the Borrowers or CarrAmerica LP and (y) any Letter of Credit Usage
described in clause (ii) of the definition thereof that are then due and payable
and second, any other unpaid Obligations then due and payable against the Letter
of Credit Collateral Account or any part thereof, in such order as the Lead
Agent shall elect. The rights of the Lead Agent under this Section 6.4 are in
addition to any rights and remedies which any Bank may have.
(ii) The Lead Agent may also exercise, in its sole discretion,
in respect of the Letter of Credit Collateral Account, in addition to the other
rights and remedies provided herein or otherwise available to it, all the rights
and remedies of a secured party upon default under the Uniform Commercial Code
in effect in the State of New York at that time.
(g) The Lead Agent shall be deemed to have exercised reasonable care in
the custody and preservation of the Letter of Credit Collateral if the Letter of
Credit Collateral is accorded treatment substantially equal to that which the
Lead Agent accords its own property, it being understood that, assuming such
treatment, the Lead Agent shall not have any responsibility or liability with
respect thereto.
(h) At such time as all Events of Default have been cured or waived in
writing, all amounts remaining in the
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Letter of Credit Collateral Account shall be promptly returned to the Borrowers.
Absent such cure or written waiver, any surplus of the funds held in the Letter
of Credit Collateral Account and remaining after payment in full of all of the
Obligations of the Borrowers and CarrAmerica LP hereunder and under any other
Loan Document after the Maturity Date shall be paid to the Borrowers or to
whomsoever may be lawfully entitled to receive such surplus.
ARTICLE VII
THE LEAD AGENT
SECTION 7.1. Appointment and Authorization. Each Bank irrevocably
appoints and authorizes the Lead Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement and the other Loan
Documents as are delegated to the Lead Agent by the terms hereof or thereof,
together with all such powers as are reasonably incidental thereto.
SECTION 7.2. Lead Agent and Affiliates. Xxxxxx shall have the same
rights and powers under this Agreement as any other Bank and may exercise or
refrain from exercising the same as though it were not the Lead Agent, and
Xxxxxx and its affiliates may accept deposits from, lend money to, and generally
engage in any kind of business with the Borrowers and/or CarrAmerica LP or any
subsidiary or affiliate of the Borrowers or CarrAmerica LP as if it were not the
Lead Agent hereunder, and the term "Bank" and "Banks" shall include Xxxxxx in
its individual capacity.
SECTION 7.3. Action by Lead Agent. The obligations of the Lead Agent
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Lead Agent shall not be required to take any
action with respect to any Default, except as expressly provided in Article VI.
SECTION 7.4. Consultation with Experts. The Lead Agent may consult with
legal counsel (who may be counsel for the Borrowers or CarrAmerica LP),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken by it in good faith
88
in accordance with the advice of such counsel, accountants or experts.
SECTION 7.5. Liability of Lead Agent. Neither the Lead Agent nor any of
its affiliates nor any of their respective directors, officers, agents or
employees shall be liable for any action taken or not taken by it in connection
herewith (i) with the consent or at the request of the Required Banks or, where
required by the terms of this Agreement, all of the Banks, or (ii) in the
absence of its own gross negligence or willful misconduct. Neither the Lead
Agent nor any of its directors, officers, agents or employees shall be
responsible for or have any duty to ascertain, inquire into or verify (i) any
statement, warranty or representation made in connection with this Agreement or
any borrowing hereunder; (ii) the performance or observance of any of the
covenants or agreements of the Borrowers or CarrAmerica LP; (iii) the
satisfaction of any condition specified in Article III, except receipt of items
required to be delivered to the Lead Agent; or (iv) the validity, effectiveness
or genuineness of this Agreement, the other Loan Documents or any other
instrument or writing furnished in connection herewith. The Lead Agent shall not
incur any liability by acting in reliance upon any notice, consent, certificate,
statement, or other writing (which may be a bank wire, telex or similar writing)
believed by it in good faith to be genuine or to be signed by the proper party
or parties.
SECTION 7.6. Indemnification. Each Bank shall, ratably in accordance
with its Commitment, indemnify the Lead Agent, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrowers or CarrAmerica LP) against any cost, expense
(including counsel fees and disbursements), claim, demand, action, loss or
liability (except such as result from such indemnitees' gross negligence or
willful misconduct) that such indemnitees may suffer or incur in connection with
this Agreement, the other Loan Documents or any action taken or omitted by such
indemnitees hereunder.
SECTION 7.7. Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Lead Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement.
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Each Bank also acknowledges that it will, independently and without reliance
upon the Lead Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking any action under this Agreement.
SECTION 7.8. Successor Lead Agent. The Lead Agent may resign at any time
by giving notice thereof to the Banks and the Borrowers. Upon any such
resignation or the removal of the Lead Agent in accordance with Section 7.11,
the Required Banks shall have the right to appoint a successor Lead Agent. If no
successor Lead Agent shall have been so appointed by the Required Banks, and
shall have accepted such appointment, within 30 days after the retiring Lead
Agent gives notice of resignation, then the retiring Lead Agent may, on behalf
of the Banks, appoint a successor Lead Agent, which shall be a commercial bank
organized or licensed under the laws of the United States of America or of any
State thereof and having a combined capital and surplus of at least $50,000,000.
Upon the acceptance of its appointment as the Lead Agent hereunder by a
successor Lead Agent, such successor Lead Agent shall thereupon succeed to and
become vested with all the rights and duties of the retiring Lead Agent, and the
retiring Lead Agent shall be discharged from its duties and obligations
hereunder first accruing or arising after the effective date of such retirement.
After any retiring Lead Agent's resignation hereunder as Lead Agent, the
provisions of this Article shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was the Lead Agent.
SECTION 7.9. Lead Agent's Fee. The Borrowers shall pay to the Lead Agent
for its own account fees in the amounts and at the times previously agreed upon
between the Borrowers and the Lead Agent.
SECTION 7.10. Copies of Notices. Lead Agent shall deliver to each Bank a
copy of any notice sent to either Borrower or CarrAmerica LP by Lead Agent in
connection with the performance of its duties as Lead Agent hereunder.
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SECTION 7.11. Removal of Lead Agent. If the Lead Agent shall breach any
of its material obligations under this Agreement, then, upon the unanimous
consent of all the Banks (other than the Lead Agent), the Lead Agent may be
removed as Lead Agent hereunder. Upon any such removal of the Lead Agent in
accordance with this Section 7.11, the Required Banks shall have the right to
appoint a successor Lead Agent in accordance with Section 7.8.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.1. Basis for Determining Interest Rate Inadequate or Unfair.
If on or prior to the first day of any Interest Period for any Euro-Dollar
Borrowing:
(a) the Lead Agent is advised by the Reference Bank that deposits in
dollars (in the applicable amounts) are not being offered to the Reference Bank
in the relevant market for such Interest Period, or
(b) Banks having 50% or more of the aggregate amount of the Commitments
advise the Lead Agent that the Adjusted London Interbank Offered Rate as
determined by the Lead Agent will not adequately and fairly reflect the cost to
such Banks of funding their Euro-Dollar Loans for such Interest Period, the Lead
Agent shall forthwith give notice thereof to the Borrowers and the Banks,
whereupon until the Lead Agent notifies the Borrowers that the circumstances
giving rise to such suspension no longer exist, the obligations of the Banks to
make Euro-Dollar Loans shall be suspended. Unless the applicable Borrower
notifies the Lead Agent at least two Domestic Business Days before the date of
any Euro-Dollar Borrowing for which a Notice of Borrowing has previously been
given that it elects not to borrow on such date, such Borrowing shall instead be
made as a Base Rate Borrowing.
SECTION 8.2. Illegality. If, after the date of this Agreement, the
adoption of any applicable law, rule or regulation, or any change in any
existing applicable law, rule or regulation, or any change in the interpretation
or administration thereof by any governmental authority, central
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bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Euro-Dollar Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall make it unlawful or
impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain or
fund its Euro-Dollar Loans or to participate in any Letter of Credit issued by
the Fronting Bank or, with respect to the Fronting Bank, to issue any Letters of
Credit, and such Bank shall so notify the Lead Agent, the Lead Agent shall
forthwith give notice thereof to the other Banks and the Borrowers, whereupon
until such Bank notifies the Borrowers and the Lead Agent that the circumstances
giving rise to such suspension no longer exist, the obligation of such Bank to
make Euro-Dollar Loans or to participate in any Letter of Credit issued by the
Fronting Bank or, with respect to the Fronting Bank, to issue any Letters of
Credit, shall be suspended. Before giving any notice to the Lead Agent pursuant
to this Section, such Bank shall designate a different Euro-Dollar Lending
Office if such designation will avoid the need for giving such notice and will
not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. If
such Bank shall determine that it may not lawfully continue to maintain and fund
any of its outstanding Euro-Dollar Loans to maturity and shall so specify in
such notice, the Borrowers and/or CarrAmerica LP shall immediately prepay in
full the then outstanding principal amount of each such Euro-Dollar Loan,
together with accrued interest thereon. Concurrently with prepaying each such
Euro-Dollar Loan, the Borrowers shall borrow a Base Rate Loan in an equal
principal amount from such Bank (on which interest and principal shall be
payable contemporaneously with the related Euro-Dollar Loans of the other
Banks), and such Bank shall make such a Base Rate Loan.
SECTION 8.3. Increased Cost and Reduced Return.
(a) If, after the date hereof, the adoption of any applicable law, rule
or regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Applicable Lending
Office) with any request or directive (whether or not having the force of
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law) of any such authority, central bank or comparable agency shall impose,
modify or deem applicable any reserve (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve System (but
excluding with respect to any Euro-Dollar Loan any such requirement reflected in
an applicable Euro-Dollar Reserve Percentage)), special deposit, insurance
assessment or similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Bank (or its Applicable Lending Office)
or shall impose on any Bank (or its Applicable Lending Office) or on the London
interbank market any other condition affecting its Euro-Dollar Loans, its Note,
or its obligation to make Euro-Dollar Loans, and the result of any of the
foregoing is to increase the cost to such Bank (or its Applicable Lending
Office) of making or maintaining any Euro-Dollar Loan, or to reduce the amount
of any sum received or receivable by such Bank (or its Applicable Lending
Office) under this Agreement or under its Note with respect thereto, by an
amount deemed by such Bank to be material, then, within 15 days after demand by
such Bank (with a copy to the Lead Agent), which demand shall be accompanied by
a certificate showing, in reasonable detail, the calculation of such amount or
amounts, the Borrowers and/or CarrAmerica LP shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such increased
cost or reduction.
(b) If any Bank shall have determined that, after the date hereof, the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change in any such law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or any request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on capital
of such Bank (or its Parent) as a consequence of such Bank's obligations
hereunder to a level below that which such Bank (or its Parent) could have
achieved but for such adoption, change, request or directive (taking into
consideration its policies with respect to capital adequacy) by an amount deemed
by such Bank to be material, then from time to time, within 15 days after demand
by such Bank (with a copy to the Lead Agent), which demand shall be accompanied
by a certificate showing, in
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reasonable detail, the calculation of such amount or amounts, the Borrowers
and/or CarrAmerica LP shall pay to such Bank such additional amount or amounts
as will compensate such Bank (or its Parent) for such reduction.
(c) Each Bank will promptly notify the Borrowers and CarrAmerica LP and
the Lead Agent of any event of which it has knowledge, occurring after the date
hereof, which will entitle such Bank to compensation pursuant to this Section
and will designate a different Applicable Lending Office if such designation
will avoid the need for, or reduce the amount of, such compensation and will
not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. A
certificate of any Bank claiming compensation under this Section and setting
forth the additional amount or amounts to be paid to it hereunder shall be
conclusive in the absence of manifest error. In determining such amount, such
Bank may use any reasonable averaging and attribution methods.
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SECTION 8.4. Taxes.
(a) Any and all payments by the Borrowers or CarrAmerica LP to or for
the account of any Bank or the Lead Agent hereunder or under any other Loan
Document shall be made free and clear of and without deduction for any and all
present or future taxes, duties, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case
of each Bank and the Lead Agent, taxes imposed on its income, and franchise
taxes imposed on it, by the jurisdiction under the laws of which such Bank or
the Lead Agent (as the case may be) is organized or any political subdivision
thereof and, in the case of each Bank, taxes imposed on its income, and
franchise or similar taxes imposed on it, by the jurisdiction of such Bank's
Applicable Lending Office or any political subdivision thereof (and, if
different from the jurisdiction of such Bank's Applicable Lending Office, the
jurisdiction of the domicile of its Loans either established by the Bank
pursuant to Section 9.12 or determined by the applicable taxing authorities)(all
such non-excluded taxes, duties, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes"). If the
Borrowers and/or CarrAmerica LP shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder or under any Note or Letter of
Credit or participation therein to any Bank or the Lead Agent, (i) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 8.4) such Bank, the Fronting Bank or the Lead Agent (as the case
may be) receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrowers or CarrAmerica LP shall make such
deductions, (iii) the Borrowers or CarrAmerica LP shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law and (iv) the Borrowers or CarrAmerica LP shall furnish to
the Lead Agent, at its address referred to in Section 9.1, the original or a
certified copy of a receipt evidencing payment thereof.
(b) In addition, the Borrowers and CarrAmerica LP agree to pay any
present or future stamp or documentary taxes and any other excise or property
taxes, or charges or similar levies which arise from any payment made hereunder
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or under any Note or Letter of Credit or participation therein or from the
execution or delivery of, or otherwise with respect to, this Agreement or any
Note or Letter of Credit or participation therein (hereinafter referred to as
"Other Taxes").
(c) The Borrowers and CarrAmerica LP agree to indemnify each Bank, the
Fronting Bank and the Lead Agent for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed or asserted by
any jurisdiction on amounts payable under this Section 8.4) paid by such Bank,
the Fronting Bank or the Lead Agent (as the case may be) and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto. This indemnification shall be made within 15 days from the date such
Bank, the Fronting Bank or the Lead Agent (as the case may be) makes demand
therefor.
(d) Each Bank organized under the laws of a jurisdiction outside the
United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each Bank listed on the signature pages hereof and on
or prior to the date on which it becomes a Bank in the case of each other Bank,
and from time to time thereafter if requested in writing by the Borrowers or
CarrAmerica LP (but only so long as such Bank remains lawfully able to do so),
shall provide the Borrowers or CarrAmerica LP with Internal Revenue Service form
1001 or 4224, as appropriate, or any successor form prescribed by the Internal
Revenue Service, certifying that such Bank is entitled to benefits under an
income tax treaty to which the United States is a party which reduces the rate
of withholding tax on payments of interest or certifying that the income
receivable pursuant to this Agreement is effectively connected with the conduct
of a trade or business in the United States. If the form provided by a Bank at
the time such Bank first became a party to this Agreement or at any time
thereafter (other than solely by reason of a change in United States law or a
change in the terms of any treaty to which the United States is a party after
the date hereof) indicates a United States interest withholding tax rate in
excess of zero (or would have indicated such a withholding tax rate if such form
had been submitted and completed accurately and completely and either was not
submitted or was not completed accurately and completely), or if a Bank
otherwise is subject to United States interest withholding tax at a rate in
excess of zero
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at any time for any reason (other than solely by reason of a change in United
States law or regulation or a change in any treaty to which the United States is
a party after the date hereof), withholding tax at such rate shall be considered
excluded from "Taxes" as defined in Section 8.4(a). In addition, any amount that
otherwise would be considered "Taxes" or "Other Taxes" for purposes of this
Section 8.4 shall be excluded therefrom if the Bank either has transferred the
domicile of its Loans pursuant to Section 9.12 or changed the Applicable Lending
Office with respect to such Loans and such amount would not have been incurred
had such transfer or change not been made.
(e) For any period with respect to which a Bank has failed to provide
the Borrowers or CarrAmerica LP with the appropriate form pursuant to Section
8.4(d) (unless such failure is due to a change in treaty, law or regulation
occurring subsequent to the date on which a form originally was required to be
provided), such Bank shall not be entitled to indemnification under Section
8.4(a) with respect to Taxes imposed by the United States; provided, however,
that should a Bank, which is otherwise exempt from or subject to a reduced rate
of withholding tax, become subject to Taxes because of its failure to deliver a
form required hereunder, the Borrowers and CarrAmerica LP shall take such steps
as such Bank shall reasonably request to assist such Bank to recover such Taxes.
(f) If the Borrowers or CarrAmerica LP are required to pay additional
amounts to or for the account of any Bank pursuant to this Section 8.4, then
such Bank will change the jurisdiction of its Applicable Lending Office so as to
eliminate or reduce any such additional payment which may thereafter accrue if
such change, in the judgment of such Bank, is not otherwise disadvantageous to
such Bank.
SECTION 8.5. Base Rate Loans Substituted for Affected Euro-Dollar Loans.
If (i) the obligation of any Bank to make Euro-Dollar Loans has been suspended
pursuant to Sections 8.1 or 8.2 or (ii) any Bank has demanded compensation under
Section 8.3 or 8.4 with respect to its Euro-Dollar Loans and the Borrowers
shall, by at least five Euro-Dollar Business Days' prior notice to such Bank
through the Lead Agent, have elected that the provisions of this Section shall
apply to such Bank, then, unless and until such Bank
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notifies the Borrowers that the circumstances giving rise to such suspension or
demand for compensation no longer exist:
(a) all Loans which would otherwise be made by such Bank as Euro-Dollar
Loans shall be made instead as Base Rate Loans (on which interest and principal
shall be payable contemporaneously with the related Euro-Dollar Loans of the
other Banks), and
(b) after each of its Euro-Dollar Loans has been repaid, all payments of
principal which would otherwise be applied to repay such Euro-Dollar Loans shall
be applied to repay its Base Rate Loans instead.
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ARTICLE IX
MISCELLANEOUS
SECTION 9.1. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including bank wire, telex, facsimile
transmission or similar writing) and shall be given to such party: (x) in the
case of the Borrowers, CarrAmerica LP or the Lead Agent, at its address or
telecopy number set forth on the signature pages hereof, together with copies
thereof, in the case of the Borrowers or CarrAmerica LP, to Xxxxx & Xxxxxxx
L.L.P., 000 00xx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, Attention: J. Xxxxxx
Xxxxxxx, Xx., Esq., Telephone: (000) 000-0000, Telecopy: (000) 000-0000, and in
the case of the Lead Agent, to Skadden, Arps, Slate, Xxxxxxx & Xxxx, 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx Xxxxxxxxxxx, Esq.,
Telephone: (000) 000-0000, Telecopy: (000) 000-0000, (y) in the case of any
Bank, at its address or telecopy number set forth on the signature pages hereof
or in its Administrative Questionnaire or (z) in the case of any party, such
other address or telecopy number as such party may hereafter specify for the
purpose by notice to the Lead Agent, the Banks, the Borrowers and CarrAmerica
LP. Each such notice, request or other communication shall be effective (i) if
given by telecopy, when such telecopy is transmitted to the telecopy number
specified in this Section, (ii) if given by mail, 72 hours after such
communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid or (iii) if given by any other means, when delivered at
the address specified in this Section; provided that notices to the Lead Agent
under Article II or Article VIII shall not be effective until received.
SECTION 9.2. No Waivers. No failure or delay by the Lead Agent or any
Bank in exercising any right, power or privilege hereunder or under any Note
shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.
SECTION 9.3. Expenses; Indemnification.
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(a) The Borrowers and CarrAmerica LP shall pay (i) all reasonable
out-of-pocket expenses of the Lead Agent (including, without limitation,
reasonable fees and disbursements of special counsel Skadden, Arps, Slate,
Xxxxxxx & Xxxx, local counsel for the Lead Agent, and travel, environmental and
engineering expenses), in connection with the preparation and administration of
this Agreement, the Loan Documents and the documents and instruments referred to
therein, the syndication of the Loans, any waiver or consent hereunder or any
amendment or modification hereof or any Default or alleged Default hereunder and
(ii) if an Event of Default occurs, all out-of-pocket expenses incurred by the
Lead Agent and each Bank, including, without limitation, reasonable fees and
disbursements of counsel for the Lead Agent, in connection with the enforcement
of the Loan Documents and the instruments referred to therein and such Event of
Default and collection, bankruptcy, insolvency and other enforcement proceedings
resulting therefrom.
(b) The Borrowers and CarrAmerica LP agree to indemnify the Lead Agent
and each Bank, their respective affiliates and the respective directors,
officers, agents and employees of the foregoing (each an "Indemnitee") and hold
each Indemnitee harmless from and against any and all liabilities, losses,
damages, costs and expenses of any kind, including, without limitation, the
reasonable fees and disbursements of counsel, which may be incurred by such
Indemnitee in connection with any investigative, administrative or judicial
proceeding (whether or not such Indemnitee shall be designated a party thereto)
that may at any time (including, without limitation, at any time following the
payment of the Obligations) be imposed on, asserted against or incurred by any
Indemnitee as a result of, or arising out of, or in any way related to or by
reason of, (i) any of the transactions contemplated by the Loan Documents or the
execution, delivery or performance of any Loan Document, (ii) any violation by
the Borrowers, CarrAmerica LP or the Environmental Affiliates of any applicable
Environmental Law, (iii) any Environmental Claim arising out of the management,
use, control, ownership or operation of property or assets by the Borrowers,
CarrAmerica LP or any of the Environmental Affiliates, including, without
limitation, all on-site and off-site activities involving Materials of
Environmental Concern, (iv) the breach of any environmental representation or
warranty set forth herein, (v) the grant to the Lead Agent and the Banks of any
Lien in any property or assets of the
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Borrowers or CarrAmerica LP or any stock or other equity interest in the
Borrowers or CarrAmerica LP, and (vi) the exercise by the Lead Agent and the
Banks of their rights and remedies (including, without limitation, foreclosure)
under any agreements creating any such Lien (but excluding, as to any
Indemnitee, any such losses, liabilities, claims, damages, expenses,
obligations, penalties, actions, judgments, suits, costs or disbursements
incurred solely by reason of (i) the gross negligence or willful misconduct of
such Indemnitee as finally determined by a court of competent jurisdiction and
(ii) any investigative, administrative or judicial proceeding imposed or
asserted against any Indemnitee by any bank regulatory agency or by any equity
holder of such Indemnitee). Xxxx and CarrAmerica LP shall be jointly and
severally liable for all Obligations arising hereunder in connection with the
Tranche A Loans and Xxxx and Xxxx XX shall be jointly and severally liable for
all Obligations arising hereunder in connection with the Tranche B Loans.
Notwithstanding the foregoing, Xxxx XX shall not be liable for any Borrowings
made by Xxxx pursuant to the terms hereof. The Borrowers' and CarrAmerica LP's
obligations under this Section shall survive the termination of this Agreement
and the payment of the Obligations.
(c) The Borrowers and CarrAmerica LP shall pay, and hold the Lead Agent
and each of the Banks harmless from and against, any and all present and future
U.S. stamp, recording, transfer and other similar foreclosure related taxes with
respect to the foregoing matters and hold the Lead Agent and each Bank harmless
from and against any and all liabilities with respect to or resulting from any
delay or omission (other than to the extent attributable to such Bank) to pay
such taxes.
SECTION 9.4. Sharing of Set-Offs. In addition to any rights now or
hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, upon the occurrence and during the continuance of
any Event of Default, each Bank is hereby authorized at any time or from time to
time, without presentment, demand, protest or other notice of any kind to the
Borrowers, CarrAmerica LP or to any other Person, any such notice being hereby
expressly waived, to set off and to appropriate and apply any and all deposits
(general or special, time or demand, provisional or final), other than deposits
held for the benefit of third parties, and any other indebtedness at any time
held or
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owing by such Bank (including, without limitation, by branches and agencies of
such Bank wherever located) to or for the credit or the account of the Borrowers
or CarrAmerica LP against and on account of the Obligations of the Borrowers or
CarrAmerica LP then due and payable to such Bank under this Agreement or under
any of the other Loan Documents, including, without limitation, all interests in
Obligations purchased by such Bank. Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive payment of
a proportion of the aggregate amount of principal and interest due with respect
to any Note held by it or Letter of Credit participated in by it, or, in the
case of the Fronting Bank, Letter of Credit issued by it, which is greater than
the proportion received by any other Bank or Letter of Credit issued or
participated in by such other Bank, in respect of the aggregate amount of
principal and interest due with respect to any Note held by such other Bank, the
Bank receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks or Letter of Credit issued
or participated in by such other Bank, and such other adjustments shall be made,
as may be required so that all such payments of principal and interest with
respect to the Notes held by the Banks or Letter of Credit issued or
participated in by such other Banks shall be shared by the Banks pro rata;
provided that nothing in this Section shall impair the right of any Bank to
exercise any right of set-off or counterclaim it may have and to apply the
amount subject to such exercise to the payment of indebtedness of the Borrowers
or CarrAmerica LP other than their indebtedness under the Notes or the Letters
of Credit. The Borrowers and CarrAmerica LP agree, to the fullest extent they
may effectively do so under applicable law, that any holder of a participation
in a Note or Letter of Credit, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of set-off or counterclaim and other rights
with respect to such participation as fully as if such holder of a participation
were a direct creditor of the Borrowers or CarrAmerica LP in the amount of such
participation. Notwithstanding the foregoing, any Bank shall not exercise any
right of set-off or counterclaim or any similar right it may have against any
other indebtedness at any time held or owing by such Bank (including, without
limitation, by branches and agencies of such Bank wherever located) to or for
the credit or the account of Xxxx XX against and on account of any Obligations
of Xxxx (whether
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or not then due and payable) or to apply the amount subject to such exercise to
the payment of indebtedness or other Obligations of Xxxx.
SECTION 9.5. Amendments and Waivers. Any provision of this Agreement,
the Notes, the Letters of Credit or other Loan Documents may be amended or
waived if, but only if, such amendment or waiver is in writing and is signed by
the Borrowers and the Required Banks (and, if the rights or duties of the Lead
Agent are affected thereby, by the Lead Agent); provided that no such amendment
or waiver shall, unless signed by all the Banks, (i) increase or decrease the
Commitment of any Bank (except for a ratable decrease in the Commitments of all
Banks) or subject any Bank to any additional obligation, (ii) reduce the
principal of or rate of interest on any Loan or any fees specified herein,
including, without limitation, the waiver of any Default or Event of Default in
the payment of interest, principal or fees hereunder if such waiver would result
in a permanent reduction in the amount or change in the timing of the payment of
interest, principal or fees payable hereunder by Borrowers or CarrAmerica LP,
unless the Borrowers or CarrAmerica LP have cured such Default or Event of
Default and paid all amounts, including any default interest, due hereunder at
the time a request for consent is made by Lead Agent to the Banks to the waiver
of any Default or Event of Default in the payment of interest, principal or fees
hereunder, in which event only the consent of the Required Banks to the waiver
of such Default or Event of Default shall be required, (iii) postpone the date
fixed for any payment of principal of or interest on any Loan or any fees
hereunder or for any reduction or termination of any Commitment or (iv) change
the percentage of the Commitments or of the aggregate unpaid principal amount of
the Notes, or the number of Banks, which shall be required for the Banks or any
of them to take any action under this Section or any other provision of this
Agreement.
SECTION 9.6. Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns,
except that the Borrowers may not assign or otherwise transfer any of their
rights under this Agreement or the other Loan Documents without the prior
written consent of all Banks.
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(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment or
any or all of its Loans. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to the
Borrowers, CarrAmerica LP and the Lead Agent, such Bank shall remain responsible
for the performance of its obligations hereunder, and the Borrowers, CarrAmerica
LP and the Lead Agent shall continue to deal solely and directly with such Bank
in connection with such Bank's rights and obligations under this Agreement. Any
agreement pursuant to which any Bank may grant such a participating interest
shall provide that such Bank shall retain the sole right and responsibility to
enforce the obligations of the Borrowers and CarrAmerica LP hereunder including,
without limitation, the right to approve any amendment, modification or waiver
of any provision of this Agreement; provided that such participation agreement
may provide that such Bank will not agree to any modification, amendment or
waiver of this Agreement described in clause (i), (ii), (iii) or (iv) of Section
9.5 without the consent of the Participant. The Borrowers and CarrAmerica LP
agree that each Participant shall, to the extent provided in its participation
agreement, be entitled to the benefits of Article VIII with respect to its
participating interest. An assignment or other transfer which is not permitted
by subsection (c) or (d) below shall be given effect for purposes of this
Agreement only to the extent of a participating interest granted in accordance
with this subsection (b).
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "Assignee") all, or a proportionate part of all, of its
rights and obligations under this Agreement, the Notes and the other Loan
Documents, and such Assignee shall assume such rights and obligations, pursuant
to an Assignment and Assumption Agreement in substantially the form of Exhibit C
attached hereto executed by such Assignee and such transferor Bank, with (and
subject to) the subscribed consent of the Lead Agent and, provided no Event of
Default shall have occurred and be continuing, the Borrowers, which consent
shall not be unreasonably withheld or delayed. Upon execution and delivery of
such instrument and payment by such Assignee to such transferor Bank of an
amount equal to the purchase price agreed between such transferor Bank and such
Assignee, such Assignee
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shall be a Bank party to this Agreement and shall have all the rights and
obligations of a Bank with a Commitment as set forth in such instrument of
assumption, and the transferor Bank shall be released from its obligations
hereunder to a corresponding extent, and no further consent or action by any
party shall be required. Upon the consummation of any assignment pursuant to
this subsection (c), the transferor Bank, the Lead Agent, the Borrowers and
CarrAmerica LP, if applicable, shall make appropriate arrangements so that, if
required, a new Note or Notes are issued to the Assignee. In connection with any
such assignment, the transferor Bank shall pay to the Lead Agent an
administrative fee for processing such assignment in the amount of $2,500. If
the Assignee is not incorporated under the laws of the United States of America
or a state thereof, it shall deliver to the Borrowers and the Lead Agent
certification as to exemption from deduction or withholding of any United States
federal income taxes in accordance with Section 8.4.
(d) Any Bank may at any time assign all or any portion of its rights
under this Agreement and its Note and the Letters of Credit participated in by
such Bank (as a Fronting Bank) or, in the case of the Fronting Bank, issued by
it, to a Federal Reserve Bank. No such assignment shall release the transferor
Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's rights
shall be entitled to receive any greater payment under Section 8.3 or 8.4 than
such Bank would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrowers' prior written
consent or by reason of the provisions of Section 8.2, 8.3 or 8.4 requiring such
Bank to designate a different Applicable Lending Office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.
SECTION 9.7. Governing Law; Submission to Jurisdiction.
(a) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT
105
GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW).
(b) Any legal action or proceeding with respect to this
Agreement or any other Loan Document and any action for enforcement of any
judgment in respect thereof may be brought in the courts of the State of New
York or of the United States of America for the Southern District of New York,
and, by execution and delivery of this Agreement, each Borrower and CarrAmerica
LP hereby accepts for itself and in respect of its property, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
appellate courts from any thereof. Each Borrower and CarrAmerica LP irrevocably
consents to the service of process out of any of the aforementioned courts in
any such action or proceeding by the hand delivery, or mailing of copies thereof
by registered or certified mail, postage prepaid, to the applicable Borrower or
CarrAmerica LP at its address set forth below. Each Borrower and CarrAmerica LP
hereby irrevocably waives any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Agreement or any other Loan Document brought in
the courts referred to above and hereby further irrevocably waives and agrees
not to plead or claim in any such court that any such action or proceeding
brought in any such court has been brought in an inconvenient forum. Nothing
herein shall affect the right of the Lead Agent, any Bank or any holder of a
Note to serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against the Borrowers or CarrAmerica LP in any
other jurisdiction.
Section 9.8. Marshalling; Recapture. Neither the Lead Agent nor
any Bank shall be under any obligation to xxxxxxxx any assets in favor of the
Borrowers, CarrAmerica LP or any other party or against or in payment of any or
all of the Obligations. To the extent any Bank receives any payment by or on
behalf of the Borrowers or CarrAmerica LP, which payment or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to either Borrower or CarrAmerica LP or its estate,
trustee, receiver, custodian or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then to the extent of such
payment or repayment, the Obligation or part thereof which has been
106
paid, reduced or satisfied by the amount so repaid shall be reinstated by the
amount so repaid and shall be included within the liabilities of the Borrowers
and CarrAmerica LP to such Bank as of the date such initial payment, reduction
or satisfaction occurred.
SECTION 9.9. Counterparts; Integration; Effectiveness. This Agreement
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof. This
Agreement shall become effective upon receipt by the Lead Agent of counterparts
hereof signed by each of the parties hereto (or, in the case of any party as to
which an executed counterpart shall not have been received, receipt by the Lead
Agent in form satisfactory to it of telegraphic, telex or other written
confirmation from such party of execution of a counterpart hereof by such
party).
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWERS, CARRAMERICA
LP, THE LEAD AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 9.11. Survival. All indemnities set forth herein shall survive
the execution and delivery of this Agreement and the other Loan Documents and
the making and repayment of the Loans hereunder.
SECTION 9.12. Domicile of Loans. Subject to the provisions of Article
VIII, each Bank may transfer and carry its Loans at, to or for the account of
any domestic or foreign branch office, subsidiary or affiliate of such Bank.
SECTION 9.13. Limitation of Liability. (a) No claim may be made by the
Borrowers, CarrAmerica LP or any other Person against the Lead Agent or any Bank
or the affiliates, directors, officers, employees, attorneys or agent of any of
them for any consequential or punitive damages in respect of any claim for
breach of contract or any other theory of liability arising out of or related to
the transactions contemplated by this Agreement or by the other Loan Documents,
107
or any act, omission or event occurring in connection therewith; and each
Borrower and CarrAmerica LP hereby waives, releases and agrees not to xxx upon
any claim for any such damages, whether or not accrued and whether or not known
or suspected to exist in its favor.
(b) The Lead Agent or any Bank may look to all the assets of the
Borrowers and CarrAmerica LP in seeking to enforce the Borrowers' and
CarrAmerica LP's liability and obligations hereunder, and the lien of any
judgment against the Borrowers and CarrAmerica LP and any proceeding instituted
on, under or in connection with any Note or any of the other Loan Documents
shall extend to all property now or hereafter owned by the Borrowers and
CarrAmerica LP, except as set forth in Sections 6.2 and 9.3.
SECTION 9.14. Confidentiality.
Prior to the occurrence and continuance of an Event of Default
and except in connection with the sale or assignment or potential sale or
assignment of any Bank's Commitment or portion of its Commitment pursuant to
Section 9.6, each Bank agrees that it will use reasonable efforts, consistent
with its customary policies for maintaining information as confidential, not to
disclose without the prior consent of the Borrowers (other than to its
subsidiaries, directors, agents, employees, auditors, counsel or other
professional consultants, provided that each such recipient shall either agree
to be bound by the terms of this Section 9.14 or is otherwise bound to keep such
information confidential on a similar basis pursuant to professional ethical
obligations) any information with respect to the Borrowers, CarrAmerica LP, any
Subsidiary thereof or any of their assets or properties which is furnished
pursuant to this Agreement or any Loan Documents and which is designated as
confidential, provided that any Bank may disclose any such information (a) that
has become generally available to the public (other than as a consequence of any
Bank's breach of this Section 9.14), (b) as may be required or appropriate in
any report, statement or testimony submitted to any local, state or federal
regulatory body having or claiming to have jurisdiction over such Bank, any
nationally recognized rating agency or similar organization, (c) as may be
required or appropriate in response to any summons or subpoena or in connection
with any litigation, or (d) in order to comply with any applicable law, order,
regulation or
108
ruling; provided, further that in the case of the foregoing clauses (b), (c) and
(d), such Bank shall use reasonable efforts to give Xxxx prior notice of any
such disclosure.
SECTION 9.15. Co-Agents. Commerzbank Aktiengesellschaft, New
York Branch, Nationsbank, N.A., and Xxxxx Fargo Realty Advisors Funding,
Incorporated, each as Bank and as Co-Agent for the Banks hereunder
(collectively, the "Co-Agents") shall have no other rights, obligations and
liabilities under this Agreement except as any other Bank hereunder. Each Bank
shall, ratably in accordance with its Commitment, indemnify the Co-Agents, their
affiliates and their respective directors, officers, agents and employees (to
the extent not reimbursed by the Borrowers or CarrAmerica LP) against any cost,
expense (including counsel fees and disbursements), claim, demand, action, loss
or liability (except such as result from such indemnitees' gross negligence or
willful misconduct) that such indemnitees may suffer or incur but solely in
connection with any such claim that may result pursuant to the Co-Agents acting
as Co-Agents under this Agreement.
109
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
CARRAMERICA REALTY CORPORATION
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
0000 Xxxxxxxxxxxx Xxxxxx,
X.X.
Xxxxxxxxxx, X.X. 00000
Telecopy number: (000) 000-0000
XXXX REALTY, L.P.
By: CarrAmerica Realty
Corporation, General Partner
By: /s/ Xxxxx X. Xxxxxx
--------------------------
Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
0000 Xxxxxxxxxxxx Xxxxxx,
X.X.
Xxxxxxxxxx, X.X. 00000
Telecopy number:
(000)000-0000
CARRAMERICA REALTY, L.P.
By: CarrAmerica Realty GP
Holdings, Inc., General
Partner
By: /s/ Xxxxx X. Xxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
0000 Xxxxxxxxxxxx Xxxxxx,
X.X.
Xxxxxxxxxx, X.X. 00000
Telecopy number:
(000)000-0000
Commitments
$38,000,000 XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK
By: /s/ Xxxxxxx X. Xxxxxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President
$35,000,000 XXXXX FARGO REALTY ADVISORS FUNDING,
INCORPORATED
By: /s/ X.X. Xxxx, III
-----------------------------------
Name: X.X. Xxxx, III
Title: Vice President
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxx
Title: Assistant Secretary
$35,000,000 NATIONSBANK, N.A.
By: /s/ Xxxx X.X. Xxxx
-----------------------------------
Name: Xxxx X.X. Xxxx
Title: Vice President
$35,000,000 COMMERZBANK AKTIENGESELLSCHAFT,
NEW YORK BRANCH
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
$24,000,000 PNC BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxxx X. Xxxxxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Assistant Vice President
$24,000,000 BANK OF AMERICA ILLINOIS
By: /s/ Xxxxxx X. XxXxxxx
------------------------------
Name: Xxxxxx X. XxXxxxx
Title: Vice President
$24,000,000 BAYERISCHE HYPOTHEKEN-UND WECHSEL
-BANK AKTIENGESELLSCHAFT
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Assistant Vice President
By: /s/ Xxxxxx X. Xxxx
-------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President
Total Commitments
------------------
$215,000,000
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK, as Lead Agent
By: /s/ Xxxxxxx X. Xxxxxxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx Xxxxxxxxxx
Telephone number: (000) 000-0000
Telecopy number: (000) 000-0000
Domestic and Euro-Currency
Lending Office:
Nassau, Bahamas Office
c/o X.X. Xxxxxx Services Inc.
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxx
Telecopy number: (000) 000-0000
SCHEDULES AND EXHIBITS INTENTIONALLY OMITTED
AVAILABLE UPON REQUEST FROM
CORPORATION
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions.........................................2
SECTION 1.2. Accounting Terms and Determinations................26
SECTION 1.3. Types of Borrowings................................27
ARTICLE II
THE CREDITS
SECTION 2.1. Commitments to Lend...............................27
SECTION 2.2. Notice of Borrowing...............................28
SECTION 2.3. Notice to Banks; Funding of Loans.................30
SECTION 2.4. Notes.............................................32
SECTION 2.5. Maturity of Loans.................................33
SECTION 2.6. Interest Rates....................................33
SECTION 2.7. Fees..............................................34
SECTION 2.8. Mandatory Termination; Extension
Option............................................35
SECTION 2.9. Mandatory Prepayment..............................37
SECTION 2.10. Optional Prepayments..............................39
SECTION 2.11. General Provisions as to Payments.................41
SECTION 2.12. Funding Losses....................................42
SECTION 2.13. Computation of Interest and Fees..................42
SECTION 2.14. Method of Electing Interest Rates.................42
SECTION 2.15 Letters of Credit.................................44
SECTION 2.16 Letter of Credit Usage Absolute...................47
ARTICLE III
CONDITIONS
SECTION 3.1. Closing............................................49
SECTION 3.2. Borrowings.........................................53
SECTION 3.3. Conditions Precedent to New
Acquisitions and Additional Real Property Assets...54
ARTICLE IV
BORROWERS' REPRESENTATIONS AND WARRANTIES
SECTION 4.1. Existence and Power of Xxxx......................56
SECTION 4.2. Existence and Power of Xxxx XX
and CarrAmerica LP...................56
SECTION 4.3. Power and Authority of Xxxx......................56
SECTION 4.4. Power and Authority of Xxxx XX
and CarrAmerica LP...................56
SECTION 4.5. No Violation.....................................57
SECTION 4.6. Financial Information............................57
SECTION 4.7. Litigation ......................................58
SECTION 4.8. Compliance with ERISA............................58
SECTION 4.9. Environmental Matters............................59
SECTION 4.10. Taxes............................................59
SECTION 4.11. Full Disclosure..................................60
SECTION 4.12. Solvency.........................................60
SECTION 4.13. Use of Proceeds; Margin Regulations..............60
SECTION 4.14. Governmental Approvals...........................60
SECTION 4.15. Investment Company Act; Public
Utility Holding Company Act......................61
SECTION 4.16. Closing Date Transactions........................61
SECTION 4.17. Representations and Warranties in Loan
Documents.....................................61
SECTION 4.18. Patents, Trademarks, etc.........................61
SECTION 4.19. No Default.......................................62
SECTION 4.20. Licenses, etc....................................62
SECTION 4.21. Compliance With Law..............................62
SECTION 4.22. No Burdensome Restrictions.......................62
SECTION 4.23. Brokers' Fees....................................62
SECTION 4.24. Labor Matters....................................63
SECTION 4.25. Organizational Documents.........................63
SECTION 4.26. Principal Offices................................63
SECTION 4.27. REIT Status......................................63
SECTION 4.28. Ownership of Property............................63
SECTION 4.29. Insurance........................................64
SECTION 4.30. Surveys..........................................64
ARTICLE V
AFFIRMATIVE AND NEGATIVE COVENANTS
SECTION 5.1. Information.....................................64
SECTION 5.2. Payment of Obligations..........................68
SECTION 5.3. Maintenance of Property; Insurance..............69
SECTION 5.4. Conduct of Business.............................69
SECTION 5.5. Compliance with Laws............................69
SECTION 5.6. Inspection of Property, Books and
Records................................69
SECTION 5.7. Existence.......................................70
SECTION 5.8. Financial Covenants.............................70
SECTION 5.9. Restriction on Fundamental
Changes; Operation and Control..................72
SECTION 5.10. Changes in Business.............................73
SECTION 5.11. Fiscal Year; Fiscal Quarter.....................73
SECTION 5.12. Margin Stock....................................73
SECTION 5.13. Sale of Borrowing Base Properties...............73
SECTION 5.14. Liens; Release of Liens.........................73
SECTION 5.15. Use of Proceeds.................................74
SECTION 5.16. Development Activities..........................74
SECTION 5.17. Restrictions on Recourse Debt...................75
SECTION 5.18. Xxxx'x Status...................................75
SECTION 5.19. Certain Requirements for the
Borrowing Base Properties.........75
SECTION 5.20. Hedging Requirements............................75
SECTION 5.21. Transfer of Real Property Assets................76
SECTION 5.22. CarrAmerica Realty GP Holdings, Inc.............76
ARTICLE VI
DEFAULTS
SECTION 6.1. Events of Default..............................76
SECTION 6.2. Rights and Remedies............................79
SECTION 6.3. Notice of Default..............................81
SECTION 6.4. Actions in Respect of Letters of Credit........81
ARTICLE VII
THE LEAD AGENT
SECTION 7.1. Appointment and Authorization..................84
SECTION 7.2. Lead Agent and Affiliates......................84
SECTION 7.3. Action by Lead Agent...........................84
SECTION 7.4. Consultation with Experts......................84
SECTION 7.5. Liability of Lead Agent........................85
SECTION 7.6. Indemnification................................85
SECTION 7.7. Credit Decision................................85
SECTION 7.8. Successor Lead Agent...........................86
SECTION 7.9. Lead Agent's Fee...............................86
SECTION 7.10. Copies of Notices..............................86
SECTION 7.11. Removal of Lead Agent..........................86
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.1. Basis for Determining Interest
Rate Inadequate or Unfair.....................87
SECTION 8.2. Illegality....................................87
SECTION 8.3. Increased Cost and Reduced Return.............88
SECTION 8.4. Taxes.........................................90
SECTION 8.5. Base Rate Loans Substituted
for Affected Euro-Dollar Loans.........93
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. Notices......................................94
SECTION 9.2. No Waivers...................................94
SECTION 9.3. Expenses; Indemnification....................94
SECTION 9.4. Sharing of Set-Offs..........................96
SECTION 9.5. Amendments and Waivers.......................98
SECTION 9.6. Successors and Assigns.......................98
SECTION 9.7. Governing Law; Submission to
Jurisdiction...................100
SECTION 9.8. Marshalling; Recapture......................101
SECTION 9.9. Counterparts; Integration; Effectiveness....101
SECTION 9.10. Waiver of Jury Trial........................102
SECTION 9.11. Survival....................................102
SECTION 9.12. Domicile of Loans...........................102
SECTION 9.13. Limitation of Liability.....................102
SECTION 9.14 Confidentiality.............................103
SECTION 9.15 Co-Agents...................................103
SCHEDULES AND EXHIBITS
INTENTIONALLY OMITTED.
AVAILABLE UPON REQUEST FROM CORPORATION.
