EXHIBIT 10.23
AMENDED AND RESTATED
LOAN AGREEMENT
by and between
SQUARE 36 OFFICE JOINT VENTURE,
a District of Columbia General Partnership,
and
THE SANWA BANK LIMITED,
a Japanese banking corporation acting
through its NEW YORK BRANCH
Dated as of June __, 1997
TABLE OF CONTENTS
-----------------
PAGE
----
ARTICLE I
CERTAIN DEFINITIONS............................................................................. 2
Section 1.1 Certain Definitions...................................................... 2
Section 1.2 Accounting Terms......................................................... 8
Section 1.3 Certain Interpretations.................................................. 9
ARTICLE II
THE LOAN................................................................................... 9
Section 2.1 Agreement to Lend........................................................ 9
Section 2.2 Repayment................................................................ 10
Section 2.3 Payment of Principal and Interest........................................ 10
Section 2.4 Security................................................................. 10
Section 2.5 Interest Guaranty........................................................ 10
ARTICLE III
CONDITIONS PRECEDENT....................................................................... 11
Section 3.1 Conditions Precedent..................................................... 11
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND AGREEMENTS................................................. 15
Section 4.1 Existence and Ownership.................................................. 15
Section 4.2 Authorization, Enforceable Obligation.................................... 16
Section 4.3 Conflicting Agreements................................................... 16
Section 4.4 Copies of Documents;
Consummation of Transactions........................................... 17
Section 4.5 No Material Litigation................................................... 17
Section 4.6 Margin Regulations....................................................... 18
Section 4.7 Compliance With Applicable Laws.......................................... 18
Section 4.8 Space Leases............................................................. 18
Section 4.9 No Brokers............................................................... 19
Section 4.10 Service Contracts........................................................ 19
Section 4.11 Liens.................................................................... 19
Section 4.12 Condition of Premises.................................................... 20
Section 4.13 Financial Information.................................................... 20
Section 4.14 Permits.................................................................. 21
Section 4.15 True Statements.......................................................... 21
Section 4.16 Representations in Loan Documents........................................ 21
TABLE OF CONTENTS
-----------------
PAGE
----
ARTICLE V
COVENANTS OF BORROWER...................................................................... 21
Section 5.1 Covenants in Loan Documents.............................................. 21
Section 5.2 No Further Encumbrance................................................... 21
Section 5.3 Single Purpose........................................................... 22
Section 5.4 Information Covenants.................................................... 22
Section 5.5 Reimbursable Expenses.................................................... 24
Section 5.6 Preservation of Existence................................................ 24
Section 5.7 Future Tenant Estoppel Certificates...................................... 25
Section 5.8 Transfers of Premises.................................................... 25
Section 5.9 Amendments to Leases..................................................... 26
ARTICLE VI
EVENTS OF DEFAULT; REMEDIES................................................................ 26
Section 6.1 Events of Default........................................................ 26
Section 6.2 Remedies................................................................. 28
Section 6.3 Interest Guaranty........................................................ 29
ARTICLE VII
MISCELLANEOUS.............................................................................. 30
Section 7.1 Expenses................................................................. 30
Section 7.2 Entire Agreement......................................................... 30
Section 7.3 Counterparts............................................................. 30
Section 7.4 Assignability and Participation.......................................... 30
Section 7.5 Governing Law; Venue; Jurisdiction....................................... 31
Section 7.6 Severability............................................................. 31
Section 7.7 Successors and Assigns................................................... 31
Section 7.8 Setoff................................................................... 32
Section 7.9 Time of the Essence...................................................... 32
Section 7.10 Headings................................................................. 32
Section 7.11 Notices.................................................................. 32
Section 7.12 Successive Remedies...................................................... 34
Section 7.13 No-Waiver................................................................ 34
Section 7.14 Estoppel Certificates/Nondisturbance/Other
Agreements............................................................ 34
Section 7.15 Cross-Default............................................................ 34
Section 7.16 Purpose of Loans......................................................... 35
Section 7.17 Inconsistencies with Loan Documents...................................... 35
Section 7.18 Survival................................................................. 35
ii
TABLE OF CONTENTS
-----------------
PAGE
----
Section 7.19 Indemnification.......................................................... 35
Section 7.20 No Agency, Partnership or Joint Venture.................................. 36
Section 7.21 Negotiated Document...................................................... 36
Section 7.22 Limitation on Recourse................................................... 36
Section 7.23 Construction............................................................. 37
Section 7.24 Survival of Accrued Amounts.............................................. 37
Section 7.25 Confidentiality.......................................................... 38
iii
AMENDED AND RESTATED LOAN AGREEMENT
THIS AMENDED AND RESTATED LOAN AGREEMENT (the "AGREEMENT") made as of
the __ day of June, 1997, by and between SQUARE 36 OFFICE JOINT VENTURE, a
general partnership organized and existing under the laws of the District of
Columbia, having an office c/o Boston Properties, Inc., 0 Xxxxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000 ("BORROWER"), and THE SANWA BANK LIMITED, a Japanese
banking corporation acting through its NEW YORK BRANCH, having an office at 00
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("LENDER");
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS:
A. Borrower and Lender are parties to a Loan Agreement dated as of
August 3, 1988 (the "ORIGINAL LOAN AGREEMENT"), pursuant to which Lender made a
loan to Borrower in the principal amount of One Hundred Million ($100,000,000)
Dollars (the "LOAN");
B. Borrower has requested that Lender amend and restate the Original
Loan Agreement to permit and reflect, inter alia (i) the amendment and
----- ----
restatement of Borrower's constituent partnership documents, the admission of
new partners to Borrower, and the withdrawal of Borrower's prior general
partners, (ii) the indirect ownership of a portion of Borrower by a real estate
investment trust, (iii) the reduction of the principal amount of the Loan to
Sixty-Six Million ($66,000,000) Dollars, (iv) the reduction of the interest rate
applicable to the Loan, (v) the extension of the term of the Loan, and (vi)
certain other changes; and
C. Lender is willing to amend and restate the Original Loan
Agreement and consent to the related transactions as provided above subject to
the terms and conditions hereinafter set forth;
NOW THEREFORE, in consideration of the mutual covenants hereinafter
set forth and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and subject to and upon the terms and
conditions herein set forth, the parties hereto hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
-------------------
SECTION 1.1 Certain Definitions.
-------------------
As used in this Agreement, the capitalized terms set forth below shall
have the meanings given them in this Article I.
Affiliate - any Entity that, directly or indirectly, controls, is
---------
controlled by or is under common control with, Borrower, or any other Entity
which is controlled by BP LLC, the Operating Partnership or the REIT. For
purposes of this definition of Affiliate, "control" shall mean the right to make
or veto significant economic and management decisions without the need for the
vote, approval or consent of any other Entity.
Amended and Restated Assignment of Rents - the Amended and Restated
----------------------------------------
Assignment of Leases, Rents, Profits and Other Income dated as of the date
hereof (as it may hereafter be amended, modified, supplemented or restated) made
by Borrower for the benefit of Lender securing certain Obligations (for purposes
of this definition, as defined therein) including the indebtedness evidenced by
the Replacement Note, which Amended and Restated Assignment of Rents amends and
restates the Original Assignment of Rents.
Amended and Restated Deed of Trust - the Amended and Restated Deed of
----------------------------------
Trust and Security Agreement dated as of the date hereof (as it may hereafter be
amended, modified, supplemented, consolidated or restated) made by Borrower in
favor of certain individuals for the benefit of Lender, securing certain
Indebtedness (for purposes of this definition, as defined therein) including the
indebtedness evidenced by the Replacement Note, which Amended and Restated Deed
of Trust amends and restates the Original Deed of Trust.
Amended and Restated Interest Guaranty - the Amended and Restated
--------------------------------------
Interest Guaranty dated as of the date hereof (as it may hereafter be amended,
modified, supplemented or restated), made by Guarantors in favor of Lender,
guaranteeing payment, in certain circumstances, of interest when due and payable
under the Original Note and the Replacement Note, which Amended and Restated
Interest Guaranty amends and restates the Original Interest Guaranty.
2
BP LLC - Boston Properties LLC, a limited liability company formed and
------
existing under the laws of the State of Delaware and a general partner of
Borrower having a 1% ownership interest therein.
Business Day - a day other than a Saturday or Sunday, or a day on
------------
which banking institutions located in New York, New York are required or
authorized by law or other government action to be closed.
Closing Date - June __, 1997.
------------
Debt Service - in any period, the aggregate of all regularly scheduled
------------
principal, interest or other amounts required to be paid by Borrower in respect
of the Replacement Note (including, but not limited to any mandatory prepayments
of principal and interest), the Amended and Restated Deed of Trust, and any
other Loan Documents.
Debt Service Coverage Ratio - the ratio obtained by dividing (a) Net
---------------------------
Cash Flow for any given month by (b) Debt Service for such month.
Due Date - as defined in Section 5.5 hereof.
--------
Entity - any natural person, corporation, limited liability company,
------
firm, trust, partnership, association, government, governmental agency or any
other entity, whether acting in an individual, fiduciary, or other capacity.
Event of Default - as defined in Section 6.1 hereof.
----------------
Expenses - with respect to a given period, operating costs actually
--------
incurred by Borrower with respect to or allocable to such period in connection
with the operation or ownership of the Trust Estate calculated in accordance
with generally accepted accounting principles applicable to real estate.
Expenses shall not include: (a) Debt Service, (b) depreciation and amortization
of the Trust Estate and (c) capitalized expenditures. Expenses shall include,
without limitation: (a) real property taxes; (b) utility charges; (c) premiums
on insurance policies; (d) non-capital maintenance and cleaning expenses; and
(e) legal, accounting, brokerage, and other professional fees attributable to
the operation of the Trust Estate.
Funding Costs - all out-of-pocket fees, costs and expenses incurred by
-------------
Lender or any Loan Participant arising from or relating to the payment or
prepayment by Borrower (whether or not after the occurrence of an Event of
Default) of any principal amount of the
3
Original Note on the Closing Date or the Replacement Note at any time other than
on the Maturity Date.
Governmental Authority - as defined in the Amended and Restated Deed
----------------------
of Trust.
Guarantors - Xxxxxxxx X. Xxxxxxxxx and Xxxxxx X. Xxxxx, together;
----------
"GUARANTOR" shall mean either one of the Guarantors, individually.
Hazardous Material - as defined in the Amended and Restated Deed of
------------------
Trust.
Improvements - as defined in the Amended and Restated Deed of Trust.
------------
Involuntary Rate - as defined in the Amended and Restated Deed of
----------------
Trust.
Lead Lender - as defined in Section 7.4 hereof.
-----------
Loan - as defined in the preamble hereto.
----
Loan Amount - the aggregate of (a) all principal amounts advanced to
-----------
Borrower pursuant to the Original Loan Agreement, this Agreement and the other
Loan Documents; (b) all interest required by the Original Loan Agreement, this
Agreement, the Original Note, the Replacement Note and the other Loan Documents
to be paid by Borrower to Lender; (c) all Out-of-Pocket Costs, to the extent not
reimbursed to Lender; (d) all Funding Costs, and (e) any and all additional
amounts required to be paid by Borrower to Lender under the Original Loan
Agreement, this Agreement or any other Loan Document including, without
limitation, advances made by Lender to protect or preserve the Trust Estate or
the security interests created by the Loan Documents.
Loan Documents - this Agreement, the Supplemental Guaranty, the
--------------
Amended and Restated Interest Guaranty, the Amended and Restated Deed of Trust,
the Amended and Restated Assignment of Rents, the Replacement Note, and any and
all other documents given from time to time as security for, or in evidence of,
the Loan and the Loan Amount. References to the Loan Documents or to any
particular Loan Document shall be deemed references to such document as the same
may be renewed, modified, consolidated, replaced and/or restated from time to
time in accordance with the provisions of the Loan Documents; provided, however,
-------- -------
that this sentence shall not be construed to permit any renewal, modification,
consolidation, replacement and/or restatement that is prohibited by or
inconsistent with the provisions of this Loan Agreement or any other document to
which Lender is a party.
4
Loan Participant - any assignee of or participant in any portion of
----------------
Lender's interest in the Loan.
Loan Term - the period commencing on the Closing Date through and
---------
including the Maturity Date.
Maturity Date - August 3, 2003.
-------------
Net Cash Flow - for any given month, an amount equal to Revenues for
-------------
such month minus the Expenses for such month.
Obligations - except as specified herein, as defined in the Amended
-----------
and Restated Interest Guaranty.
Offering - the public offering of shares of common stock of the REIT
--------
pursuant to a registration statement on Form S-11 filed with and declared
effective by the Securities and Exchange Commission in accordance with the
Securities Act of 1933, as amended, and the regulations issued in accordance
therewith.
Offering Documents - the registration statement on form S-11 filed by
------------------
the REIT with the Securities and Exchange Commission in connection with the
Offering and all Exhibits, supplements and amendments thereto.
Operating Partnership - Boston Properties Limited Partnership, a
---------------------
limited partnership formed under the laws of the State of Delaware which owns a
99% general partner interest in Borrower and a 99% managing member interest in
BP LLC.
Original Assignment of Rents - the Collateral Assignment of Leases,
----------------------------
Rents, Profits and Other Income dated as of the Original Closing Date, between
Borrower and Lender.
Original Closing Date - August 3, 1988.
---------------------
Original Deed of Trust - the Deed of Trust, Consolidation,
----------------------
Modification and Security Agreement dated as of the Original Closing Date, made
by Borrower in favor of Xxxxxx X. Xxxxxxxxx and Xxxxx X. Xxxxxxx for the benefit
of Lender.
Original Interest Guaranty - the Interest Guaranty dated as of the
--------------------------
Original Closing Date made by Guarantors in favor of Lender guaranteeing
payment, in certain circumstances, of interest when due and payable under the
Original Note.
5
Original Loan Agreement - as defined in the preamble hereto.
-----------------------
Original Note - that certain Consolidated and Restated Note dated the
-------------
Original Closing Date made by Borrower in favor of Lender in the original
principal amount of One Hundred Million ($100,000,000) Dollars evidencing the
Loan, which Original Note has been superseded, reduced and replaced by the
Replacement Note.
Out-of-Pocket Costs - all reasonable costs, fees and expenses
-------------------
(including, without limitation, reasonable attorneys' fees) actually paid or
payable by Lender to unaffiliated third parties under any of the Loan Documents,
including without limitation, judgments, settlements or compromises (to the
extent such settlements or compromises have been consented to by Borrower where
such consent is required under the Loan Documents) and reasonable attorneys'
fees incurred by Lender in any suit, action, legal proceeding or dispute of any
kind in which Lender is a party or appears as a party, plaintiff or defendant,
arising from or related to the Loan, the Loan Documents or the Premises, but not
including Lender's overhead.
Permitted Exceptions - as defined in the Amended and Restated Deed of
--------------------
Trust.
Permitted Transferee - an Affiliate of Borrower or any of its
--------------------
constituent partners or partnerships or any other transferee reasonably
satisfactory to Lender.
Premises - as defined in the Amended and Restated Deed of Trust.
--------
Prime Rate - as defined in the Replacement Note.
----------
Projected Debt Service Coverage Ratio - the ratio obtained by dividing
-------------------------------------
(a) Net Cash Flow as set forth in a Projection by (b) Debt Service as set forth
in the same Projection.
Projection - a pro forma statement, prepared by Borrower and in form
----------
and substance reasonably satisfactory to Lender, setting forth in reasonable
detail Borrower's projections of Expenses, Revenues, Net Cash Flow and Debt
Service for the twelve (12) month period following the date of the Projection,
and accompanied by all such supporting materials, including without limitation,
a schedule of Qualifying Space Leases, current as of the date of such statement,
and by such certifications relating to such supporting materials as Lender may
reasonably require.
Qualifying Space Lease - a bona fide lease agreement pursuant to which
----------------------
all or a portion of the Improvements is or is intended to be occupied; provided,
--------
however, (a) such
-------
6
lease is then in full force and effect; (b) such lease, if entered into after
the Closing Date, has been created substantially in accordance with all
requirements applicable to leases as set forth in the Amended and Restated Deed
of Trust and all other Loan Documents; and (c) either (i) the tenant under such
lease is paying all the rent and other charges due thereunder or (ii) as to a
tenant not yet paying rent, such tenant is obligated to pay all of such rent,
costs, and other charges thereunder, subject only to satisfaction of conditions
precedent to such obligation set forth in such lease and evidenced by an
estoppel certificate in form and substance reasonably satisfactory to Lender.
Lender hereby acknowledges and agrees that, subject to their remaining in full
force and effect, the leases of the Improvements set forth in Exhibit A hereto
shall be deemed to be Qualifying Space Leases.
Reconstitution - the amendment and restatement of Borrower's
--------------
partnership agreement.
Reconstitution Documents - the Borrower's amended and restated
------------------------
partnership agreement.
REIT - Boston Properties, Inc., a Delaware corporation and a publicly
----
traded real estate investment trust (as defined by Sections 856 through 860 of
the Internal Revenue Code of 1986, as amended, and applicable Treasury
regulations), which owns a 1% interest in BP LLC and a majority interest (as
both a limited partner and the general partner) in the Operating Partnership.
Replacement Note - that certain Replacement Note dated the Closing
----------------
Date made by Borrower in favor of Lender in the original principal amount of
Sixty-Six Million ($66,000,000) Dollars, in replacement of and substitution for,
and evidencing the same indebtedness as, the Original Note and secured by the
Loan Documents, as the same may be amended, modified, supplemented or restated
from time to time.
Requirements of Law - as defined in the Amended and Restated Deed of
-------------------
Trust.
Revenues - with respect to a given period, the cash revenues actually
--------
received by Borrower under Qualifying Space Leases with respect to or allocable
to such period, provided, however, with respect to percentage rent received
-------- -------
under any Qualifying Space Lease, "Revenues" shall mean the monthly average of
percentage rent received by Borrower for the previous twelve months and to the
extent Borrower has not received percentage rent under any Qualifying Space
Leases for the previous twelve-month period, the percentage rent for such
Qualifying Space Lease shall not be included in the calculation of Revenues.
7
Sanwa - The Sanwa Bank Limited, New York Branch, and its legal
-----
successors.
Service Contracts - as defined in Section 4.10 hereof.
-----------------
Xxxx Xxxxxxx Lease - the Amended and Restated Lease dated September
------------------
29, 1986, between Borrower, as landlord, and Shaw, Pittman, Xxxxx and
Xxxxxxxxxx, as tenant, covering space in the Improvements.
Significant Entity - as defined in Section 6.1(e) hereof.
------------------
Space Leases - as defined in the Amended and Restated Deed of Trust.
------------
Supplemental Guaranty - one or more guaranty agreements dated as of
---------------------
the date hereof (as it may hereafter be amended, modified, supplemented or
restated) made by each of the Guarantors and certain other Entities in favor of
Lender guaranteeing payment, in certain circumstances, of a portion of the Loan
Amount.
Transfer of Borrower - any sale, assignment or other transfer, whether
--------------------
by operation of law or otherwise, voluntarily or involuntarily, by BP LLC or the
Operating Partnership of any direct ownership interest in Borrower.
Transfer of Premises - any (a) assignment, sale or other transfer by
--------------------
Borrower of the Trust Estate or any part thereof or any interest therein
(including, without limitation, any air or development rights) either
voluntarily or involuntarily, by operation of law or otherwise, or (b) lease or
sublease of all or substantially all of the space in the Premises, in a single
or successive transactions to any single lessee or related lessees.
Trust Estate - as defined in the Amended and Restated Deed of Trust.
------------
SECTION 1.2 ACCOUNTING TERMS.
----------------
Any accounting terms used in this Agreement that are not specifically
defined herein shall have the meanings customarily given to them in accordance
with generally accepted accounting principles as in effect on the date of this
Agreement, except that references in Section 5.4 to such principles shall be
deemed to refer to generally accepted accounting principles as in effect on the
date of the financial statements delivered pursuant thereto.
8
SECTION 1.3 CERTAIN INTERPRETATIONS.
-----------------------
The definitions set forth in Section 1.1 shall be equally applicable
to both the singular and plural forms of the defined terms. The words "herein",
"hereof" and words of similar import as used in this Agreement shall refer to
this Agreement as a whole and not to any particular provision in this Agreement.
Unless specifically stated to the contrary, all references to "Sections,"
"subsections," "paragraphs," "Exhibits" and "Schedules" in this Agreement shall
refer to Sections, subsections, paragraphs, Exhibits and Schedules of this
Agreement unless otherwise expressly provided; references to Entities include
their respective permitted successors and assigns or, in the case of
governmental Entities, Entities succeeding to the relevant functions of such
persons; and all references to statutes and related regulations shall include
any amendments of same and any successor statutes and regulations.
ARTICLE II
THE LOAN
--------
SECTION 2.1 AGREEMENT TO LEND.
-----------------
Pursuant to the Original Loan Agreement, Lender made the Loan to
Borrower on the Original Closing Date in the original principal amount of One
Hundred Million ($100,000,000) Dollars as evidenced by the Original Note.
Subject to the terms and conditions of this Agreement, (a) on the Closing Date,
Borrower shall repay a portion of the outstanding principal amount of such Loan
equal to Thirty Four Million ($34,000,000) Dollars, together with accrued
interest thereon and such other amounts (including but not limited to Funding
Costs) as may be due in connection therewith, and (b) Lender shall continue to
make the Loan to Borrower in the principal amount, as of the Closing Date, of
Sixty-Six Million ($66,000,000) Dollars. Borrower's obligation to pay the
principal of and interest on the Loan shall be evidenced by the Replacement
Note, duly executed and delivered by Borrower, which Replacement Note shall
replace and supersede the Original Note (which Original Note shall be marked
"Replaced by Replacement Note" and returned to Borrower on the Closing Date) and
shall mature on the Maturity Date.
9
SECTION 2.2 REPAYMENT.
---------
On the Maturity Date Borrower shall (a) fully repay the then-
outstanding principal amount of the Loan to Lender, and (b) pay any other
portion of the Loan Amount (including, but not limited to accrued interest,
fees, Funding Costs, and Out-of-Pocket Costs) then due and payable.
SECTION 2.3 PAYMENT OF PRINCIPAL AND INTEREST.
---------------------------------
The Loan shall bear interest at the rate of interest set forth in the
Replacement Note, which interest shall be payable in the place, time and manner
as provided in the Replacement Note.
SECTION 2.4 SECURITY.
--------
The Loan and the Loan Amount is and shall continue to be secured by
the Loan Documents.
SECTION 2.5 INTEREST GUARANTY.
-----------------
(a) If, as of the Closing Date, the Projected Debt Service Coverage
Ratio for the twelve (12) month period immediately following the Closing Date,
is:
(i) equal to or greater than 1.05:1, then Guarantors shall not be
liable for the Obligations unless and until the circumstances described in
Section 2.5(b) occur; or
(ii) less than 1.05:1, then Guarantors shall be liable for the
Obligations, and the Amended and Restated Interest Guaranty shall continue in
full force and effect, until such time as the Debt Service Coverage Ratio shall
be equal to or greater than 1.05:1 for three (3) consecutive calendar months, in
which event Guarantors shall not be liable for the Obligations from and after
the expiration of such three-month period unless and until the circumstances
described in Section 2.5(b) occur.
(b) If for any reason at any time when any part of the Loan Amount
remains outstanding or unpaid, the Xxxx Xxxxxxx Lease shall terminate, then
Guarantors' liability with respect to the Obligations shall continue or shall be
reinstated, as applicable, until such time as a lease or leases demising the
same space as is demised under the Xxxx Xxxxxxx Lease and upon terms and
conditions reasonably satisfactory to Lender shall have been executed and shall
be in effect.
10
ARTICLE III
CONDITIONS PRECEDENT
--------------------
SECTION 3.1 CONDITIONS PRECEDENT.
--------------------
The effectiveness of this Amended and Restated Loan Agreement shall be
subject to the fulfillment by Borrower on the Closing Date, in a manner
satisfactory to Lender, of all the conditions precedent set forth in this
Article III.
(a) Borrower shall repay the Loan, together with all accrued interest
thereon and all other fees and costs then due and payable with respect thereto
(which fees and expenses may include, but shall not be limited to, Out-of Pocket
Costs, if any, and such Funding Costs as may be incurred by Lender as a result
of such repayment), in such principal amount as shall cause the outstanding
principal amount of the Loan, as of the Closing Date, to be not more than Sixty-
Six Million ($66,000,000) Dollars.
(b) For and in consideration of Lender's entering into this Amended
and Restated Loan Agreement, Borrower shall pay to Lender on the Closing Date a
fee as set forth in the letter dated May 22, 1997 from Lender to Borrower.
(c) Borrower and each other party thereto shall have duly executed and
Lender shall have received each of the following, each of which shall be
satisfactory to Lender in form and substance:
(i) the Replacement Note;
(ii) the Amended and Restated Deed of Trust; and
(iii) the Amended and Restated Assignment of Rents.
(d) (i) Each Guarantor shall have executed and delivered to Lender
the Amended and Restated Interest Guaranty and (ii) each Guarantor and each
other party thereto shall have executed and delivered to Lender the Supplemental
Guaranty, each of which shall be satisfactory to Lender in form and substance.
(e) The Amended and Restated Deed of Trust and the Amended and
Restated Assignment of Rents shall have been delivered to Lender's title
insurance company for
11
recordation, and any other documents required in connection with the recording
of the Amended and Restated Deed of Trust and the Amended and Restated
Assignment of Rents, including, but not limited to, form UCC-1 financing
statements or amendment filings on form UCC-3 to all filed UCC-1 financing
statements, shall have been executed and delivered and/or filed, as appropriate,
and all taxes, fees and other charges payable in connection therewith shall have
been paid in full by Borrower.
(f) Lender shall have received UCC search results (which results shall
be satisfactory to Lender) with respect to Borrower, BP LLC and the Operating
Partnership.
(g) Lender shall have received, at Borrower's sole cost and expense
and in form and substance satisfactory to Lender, a "down-dated" title insurance
policy or endorsement to the existing title insurance policy, which shall show,
inter alia, (i) that the lien of the Amended and Restated Deed of Trust shall be
----- ----
a first priority lien subject to no superior or equal lien on the Premises or
the Revenues derived therefrom other than the Permitted Exceptions, (ii) that
the Trust Estate is subject only to the Permitted Exceptions, and (iii)
consummation of the Reconstitution.
(h) Lender shall have received a FIRREA-compliant appraisal prepared
by such appraisers as Lender shall find reasonably acceptable which appraisal
shall be satisfactory to Lender in form and substance.
(i) There shall have been delivered to Lender evidence of insurance
covering the Trust Estate as required by the Amended and Restated Deed of Trust,
accompanied by evidence of the payment of the premiums therefor.
(j) On the Closing Date there shall exist (i) no Event of Default and
(ii) no fact or circumstance, which, with the passage of time, giving of notice
or action of third parties, could become an Event of Default that is not then
being cured, in a manner satisfactory to Lender, in accordance with this
Agreement and the other Loan Documents.
(k) All representations and warranties contained herein and in the
other Loan Documents and in any document delivered to Lender by Borrower in
connection with the Loan shall be true and correct in all material respects.
(l) There shall be no litigation or other proceedings pending or to
Borrower's knowledge threatened with respect to the Trust Estate which, if
determined adversely to Borrower, would materially and adversely affect the
Trust Estate or the priority of Lender's lien
12
thereon or the financial condition of Borrower or Guarantors, and no
condemnation or similar proceeding pending or threatened with respect to all or
any part of the Trust Estate.
(m) Lender shall have received a certificate dated the Closing Date
signed by a general partner of Borrower stating that the conditions set forth in
the foregoing paragraphs (j), (k) and (l) shall have been satisfied as of the
Closing Date.
(n) Lender shall have received final copies of each of the
Reconstitution Documents, together with copies of all consents and approvals, if
any, required thereby, certified by a general partner of Borrower as being true
and correct.
(o) The Reconstitution shall have been consummated substantially in
accordance with the Reconstitution Documents and there shall be no litigation or
governmental action or other proceeding pending or threatened with respect
thereto, and Lender shall have received a certificate executed by a general
partner of Borrower attesting to the foregoing.
(p) There shall have been delivered to Lender a full and complete copy
of each of the following:
(i) the partnership agreement and all amendments thereto of
Borrower and of the Operating Partnership, certified as being true and
correct by a general partner of Borrower and the general partner of the
Operating Partnership, respectively;
(ii) such consents of Borrower's partners to the execution and
delivery of this Amended and Restated Loan Agreement and the transactions
contemplated hereby, including the Reconstitution, as may be required by
Lender and/or Lender's title insurance company;
(iii) the constituent limited liability company documents of BP
LLC (of which the certificate of formation shall be certified by the
Secretary of State of the State of Delaware), together with all action
taken by BP LLC as general partner of Borrower to authorize the
Reconstitution and the execution and delivery of each of the Loan Documents
being executed and delivered by Borrower on the Closing Date, certified as
being true and correct by the secretary of such general partner; and
(iv) long form good standing certificates as of dates not more
than thirty (30) days prior to the Closing Date, with respect to Borrower
and each of
13
the partners of Borrower, from the Secretary of State of each
such Entity's state of incorporation or formation, as the case may be.
(q) Lender shall have received copies of each of the following, each
certified as true and correct by an officer of the REIT:
(i) the constituent corporate documents of the REIT (of which the
charter shall be certified by the Secretary of State of its state of
incorporation), together with all corporate action taken by its board of
directors to authorize the execution and delivery and/or filing of the
Offering Documents and the consummation of the transactions contemplated
thereby; and
(ii) a long form good standing certificate as of a date not more
than thirty (30) days prior to the Closing Date with respect to the REIT
from the Secretary of State of its state of incorporation.
(r) reserved.
(s) Lender shall have received final copies of each of the Offering
Documents as filed with the Securities and Exchange Commission, together with
copies of all consents and approvals, if any, required thereby, certified by the
secretary of the REIT as being true and correct.
(t) The Offering shall have been consummated substantially in
accordance with the terms of the Offering Documents as delivered to Lender, and
there shall be no material litigation, or governmental action or other
proceeding pending or threatened with respect thereto.
(u) Lender shall have received and approved all financial information
reasonably requested by Lender concerning Borrower, the partners of Borrower,
the REIT, the Offering and the Guarantors.
(v) Lender shall have received an opinion from Borrower's counsel,
addressed to Lender and dated the Closing Date, in form and substance
satisfactory to Lender and Lender's counsel, together with such local counsel
opinions as Lender may reasonably request.
(w) Lender shall have received an opinion from counsel to the REIT,
addressed to Lender and dated the Closing Date, in form and substance
satisfactory to Lender and Lender's counsel.
14
(x) All legal proceedings and all instruments and agreements in
connection with the transactions contemplated by this Agreement, the other Loan
Documents, the Reconstitution Documents and the Offering Documents shall be
reasonably satisfactory in form and substance to Lender and its counsel, and
Lender shall have received all information and copies of all documents and
papers, including records of governmental approvals, if any, that Lender may
have reasonably requested in connection therewith, each of such documents and
papers to be certified by proper governmental authorities, where appropriate.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND AGREEMENTS
------------------------------------------
In order to induce Lender to enter into this Agreement, Borrower makes
the following representations, warranties and agreements, which shall survive
the execution and delivery of this Agreement.
SECTION 4.1 EXISTENCE AND OWNERSHIP.
-----------------------
(a) Each of Borrower, a general partnership, BP LLC, a general partner
of Borrower and a limited liability company, the Operating Partnership, a
general partner of Borrower and a limited partnership, and the REIT, a
corporation and a member of BP LLC and a partner of the Operating Partnership:
(i) has been duly formed or organized and is validly existing under the laws of
the District of Columbia, with respect to the Borrower, and the State of
Delaware with respect to such other Entities, (ii) has adequate authority,
rights and franchises to own its properties, to carry on its business as now
conducted and to perform its obligations hereunder and under the other Loan
Documents, and (iii) has made all filings in each jurisdiction in which the
character of its business or nature of its properties makes such filings
necessary and where not filing could have a material adverse impact on its
business.
(b) Borrower has no subsidiaries and no ownership interests in any
Entities. Borrower has no material assets or other material properties other
than the Premises and properties and assets directly related thereto. Borrower
conducts no business, directly or indirectly, except as contemplated by Section
5.3 of this Agreement.
(c) As of the Closing Date, BP LLC is a general partner of Borrower
having a 1% ownership interest therein, and the Operating Partnership is the
only other general partner of Borrower having a 99% ownership interest therein.
BP LLC is owned 1% by the REIT and 99% by the Operating Partnership. As of the
Closing Date, the Operating Partnership is
15
majority owned by the REIT (which has a general and limited partnership interest
therein), and by certain other limited partners.
(d) The REIT is a publicly traded real estate investment trust duly
formed and existing under the corporate laws of the State of Delaware and
Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, in
which, as of the Closing Date, Xxxxxxxx X. Xxxxxxxxx and Xxxxxx X. Xxxxx and
their respective Affiliates have an aggregate ownership interest of not less
than 7%.
SECTION 4.2 AUTHORIZATION, ENFORCEABLE OBLIGATION.
-------------------------------------
(a) Borrower and the general partners of Borrower have the authority
and legal right to execute, deliver and perform each of this Agreement and the
Replacement Note, and each of the other Loan Documents and each of the
Reconstitution Documents to which they are parties, to borrow under the Loan
Documents and to grant the liens and security interests contemplated thereby,
and to have taken all necessary action to authorize the borrowings on the terms
and conditions hereof and the execution, delivery and performance of the Loan
Documents to which they are parties.
(b) Each of this Agreement, the Replacement Note, the other Loan
Documents and Reconstitution Documents executed or to be executed by Borrower
has been or will be executed and delivered by an officer or partner of Borrower
duly authorized to execute and deliver such documents on behalf of Borrower, and
constitutes or will constitute the legal, valid and binding obligation of
Borrower, enforceable against Borrower in accordance with its terms.
(c) To the Borrower's knowledge, no consent, license, permit, approval
or authorization of, exemption by, notice or report to, or registration, filing
or declaration with, any Governmental Authority or any other Entity which has
not been obtained is required for the execution, delivery and performance by
Borrower of this Agreement and the Replacement Note, and the other Loan
Documents and the Reconstitution Documents to which it is a party, or the
consummation of the transactions contemplated hereby or thereby (including,
without limitation, the Offering).
SECTION 4.3 CONFLICTING AGREEMENTS.
----------------------
The execution and delivery by Borrower of this Agreement and the
Replacement Note, and the other Loan Documents and the Reconstitution Documents
to which it is a party, and performance by it hereunder and thereunder, will not
violate any provision of law and will not conflict with or result in a breach of
any order, writ, injunction, ordinance, resolution,
16
decree, or other similar document or instrument of any court or governmental
authority, bureau or agency, domestic or foreign, or any certificate of limited
partnership, partnership agreement, certificate of formation or limited
liability company agreement of Borrower or any other Affiliate of Borrower party
to any of the foregoing agreements, or create (with or without the giving of
notice or lapse of time, or both) a default under or breach of any agreement,
bond, note or indenture to which Borrower is a party, or by which it is bound or
any of its properties or assets, including the Trust Estate, is affected, or
result in the imposition of any lien of any nature whatsoever upon any of the
properties or assets owned by or used in connection with the business of
Borrower including the Trust Estate, except for the liens and security interests
created and granted pursuant to the Amended and Restated Deed of Trust and the
Amended and Restated Assignment of Rents.
SECTION 4.4 COPIES OF DOCUMENTS;
--------------------
CONSUMMATION OF TRANSACTIONS.
----------------------------
(a) Borrower and each of BP LLC, the Operating Partnership and the
REIT has furnished Lender with true, correct and complete certified copies of
its organizational agreements, together with all amendments thereto, if any, as
in effect at the Closing Date.
(b) Borrower has delivered or caused to be delivered to Lender true
and correct copies of each of the Reconstitution Documents and Offering
Documents.
(c) Each of the Reconstitution and the Offering was consummated
substantially in accordance with the Reconstitution Documents and the Offering
Documents, respectively, previously delivered to Lender.
SECTION 4.5 NO MATERIAL LITIGATION.
----------------------
No litigation, investigation or administrative proceeding of or before
any court, arbitrator or Governmental Authority is pending or, to Borrower's
knowledge or the knowledge of any general partner of Borrower, threatened
against Borrower, any partner thereof, against the REIT, or any of Borrower's or
any such other Entities' assets, or with respect to the Reconstitution or the
Offering, that would, if determined adversely, be likely to have a material
adverse effect on (a) Borrower's ability to perform its obligations under the
Loan Documents in accordance with the terms thereof, (b) the validity of this
Agreement or any other Loan Document, or (c) Lender's security under this
Agreement or any other Loan Document. No notice has been received by Borrower
of any proceeding to condemn, purchase or otherwise acquire the Trust Estate or
any part thereof or interest therein, and, to the best of Borrower's knowledge,
no such proceeding is contemplated.
17
SECTION 4.6 MARGIN REGULATIONS.
------------------
Borrower is not engaged, principally or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying any margin stock.
SECTION 4.7 COMPLIANCE WITH APPLICABLE LAWS.
-------------------------------
(a) To the best of Borrower's knowledge and belief, except as
otherwise specifically disclosed in writing by Borrower to Lender, each of
Borrower, BP LLC, the Operating Partnership and the REIT is in compliance with
the requirements of all applicable laws, rules, regulations, ordinances and
orders, including those applicable to the Trust Estate and the use thereof, the
failure to comply with which would materially and adversely affect Borrower's
ability to perform its obligations under this Agreement and/or any of the other
Loan Documents, and no written notice of noncompliance with any of the foregoing
has been received by Borrower, BP LLC, the Operating Partnership, or the REIT
from any Governmental Authority.
(b) Each of the Reconstitution and the Offering was consummated in
accordance with all applicable law and regulations, and no consent, approval or
authorization, or registration, declaration or filing with any Governmental
Authority or any other Entity by Borrower or any Affiliate of Borrower is or was
required for the valid execution, delivery and performance by the parties
thereto of the Reconstitution Documents, and the Offering Documents or the
carrying out of the transactions contemplated thereby which was not properly
obtained and maintained in effect by Borrower or an Affiliate of Borrower.
SECTION 4.8 SPACE LEASES.
------------
The Qualifying Space Leases described in Exhibit A hereto are in full
force and effect according to the terms and conditions thereof as contained in
the copies thereof previously furnished to Lender. Except as may be set forth
in estoppel certificates of Borrower or the tenants under such Qualifying Space
Leases delivered concurrently herewith, to the best of Borrower's knowledge, (a)
no notice of default has been given by any party to any such Qualifying Space
Lease which remains uncured, (b) there are no material defaults under any of the
provisions thereof and (c) all conditions to the effectiveness and continuing
effectiveness thereof required to be satisfied as of the Closing Date have been
satisfied. As of the Closing Date, Borrower is the holder of the Landlord's
interest under all such Qualifying Space Leases, which are the only Space Leases
in effect to which Borrower is a party. Whenever, pursuant to Section 1.12(b)
or otherwise under the Amended and Restated Deed of Trust, a
18
subordination, nondisturbance and attornment agreement is required with respect
to a Space Lease, such agreement shall be in substantially the form of Exhibit C
hereto.
SECTION 4.9 NO BROKERS.
----------
Borrower has not dealt with any mortgage or other broker or finder in
connection with the Loan. Borrower agrees to indemnify, defend and hold Lender
harmless from and against any claim for brokerage fees or commissions or other
compensation in connection with the Loan by reason of an alleged
misrepresentation of the statement made by it in the immediately preceding
sentence. In case any action, suit or proceeding is brought against Lender by
reason of an alleged misrepresentation by Borrower set forth in this Section
4.9, (a) Lender shall give prompt notice thereof to Borrower, (b) Borrower may,
at Borrower's sole cost and expense, resist and defend such action, suit or
proceeding by counsel reasonably satisfactory to Lender, and (c) if Borrower
elects to defend such action, suit or proceeding, Lender shall not compromise or
settle any such action, suit or proceeding without the consent of Borrower
unless Lender waives its right to indemnification under this Section. This
provision shall survive the repayment of the Loan and shall continue in full
force and effect so long as the possibility of such liability, claims or losses
exists.
SECTION 4.10 SERVICE CONTRACTS.
-----------------
All management, leasing, service or maintenance contracts
(collectively "SERVICE CONTRACTS") relating to or affecting the Trust Estate
and/or the Premises are listed in Exhibit B annexed hereto and made a part
hereof, and true and complete copies of all Service Contracts, including all
agreements, amendments, and other documents relating thereto have been made
available to Lender. To the best of Borrower's knowledge, all Service Contracts
are in full force and effect in accordance with their respective terms, and no
party to any Service Contract has asserted any claim of default or offset
against Borrower with respect thereto.
SECTION 4.11 LIENS.
-----
(a) No chattel mortgage, xxxx of sale, security agreement, financing
statement or other title retention agreement, except those in favor of Lender,
which has not been satisfied or terminated as of the Original Closing Date has
been executed with respect to any materials, fixtures, machinery, equipment, or
articles of personal property of Borrower used in connection with the
construction, renovation, operation or maintenance of the Premises.
(b) Without the taking of any further action (other than as may be
specifically described herein), including, without limitation, the filing of any
Uniform
19
Commercial Code financing statements or any such similar filing by or on behalf
of any Person, including, without limitation, Lender or Borrower, the liens
confirmed, created and granted by the Amended and Restated Deed of Trust and the
Amended and Restated Assignment of Rents shall, after giving effect to this
Agreement, continue, uninterrupted and unimpaired, to constitute valid first
perfected liens on the properties and assets covered by the Amended and Restated
Deed of Trust and the Amended and Restated Assignment of Rents, subject to no
prior or equal lien except the Permitted Exceptions.
(c) The liens and security interests confirmed, created and granted
pursuant to the Amended and Restated Deed of Trust and the Amended and Restated
Assignment of Rents secure, without limitation, the indebtedness, liabilities
and obligations of Borrower to Lender hereunder, under the Replacement Note, and
under the other Loan Documents, whether or not so stated in such documents.
SECTION 4.12 CONDITION OF PREMISES
---------------------
To the best of Borrower's knowledge, there are no structural defects
in the Improvements or violations of any Requirements of Law which materially
and adversely affect the Premises. The Premises are not now damaged or injured
as a result of any fire, explosion, accident, flood or other casualty, and there
have been no material structural exterior modifications to the Premises since
the date of the survey delivered by Borrower to Lender in connection with the
Original Loan Agreement. To the best of Borrower's knowledge, the Premises
comply with all private easements and restrictions affecting the Premises. To
the best of Borrower's knowledge, there are no restrictions, easements,
limitations or conditions of any sort whatsoever affecting the use of the
Premises not set forth as Permitted Exceptions. Borrower has received no
written notice from any insurance company of any defects or inadequacies in
connection with the Premises or the operation thereof that, if not corrected,
would result in the cancellation of the relevant policy or an increase in the
premium payable with respect to the relevant policy.
SECTION 4.13 FINANCIAL INFORMATION.
---------------------
The financial information delivered to Lender in accordance with
Section 3.1(u) hereof is true and correct in all material respects and fairly
presents Borrower's assets and liabilities as of March 31, 1997; and no
materially adverse change has occurred in the financial condition reflected
therein since the date thereof and no additional borrowings have been made by
Borrower since such date.
SECTION 4.14 PERMITS.
-------
20
All material permits (including, without limitation, occupancy and
other permits and licenses) required for the ownership, use, occupancy,
possession, operation or maintenance of the Improvements as a first-class office
building have been obtained and are in full force and effect.
SECTION 4.15 TRUE STATEMENTS.
---------------
Neither this Agreement, any other Loan Document, nor to the best of
Borrower's knowledge, any other document delivered to Lender in connection with
the Loan contains, or will contain when made, any untrue statement of a material
fact.
SECTION 4.16 REPRESENTATIONS IN LOAN DOCUMENTS.
---------------------------------
The representations and warranties of Borrower contained in the Loan
Documents to which it is a party are true and correct, and by this reference all
such representations and warranties are hereby made a part of this Agreement to
the same extent as if fully set forth herein.
ARTICLE V
COVENANTS OF BORROWER
---------------------
During the period the Loan remains in effect and any part of the Loan
Amount remains outstanding or unpaid, or any other amount or obligation is owing
to Lender hereunder or under any of the Loan Documents, Borrower shall keep and
perform fully each and all of the following covenants:
SECTION 5.1 COVENANTS IN LOAN DOCUMENTS.
---------------------------
Borrower shall observe and perform or shall cause to be observed and
performed all of the covenants contained in the Amended and Restated Deed of
Trust and the other Loan Documents, and by this reference all of such covenants
are hereby made a part of this Agreement to the same extent as if fully set
forth herein.
21
SECTION 5.2 NO FURTHER ENCUMBRANCE.
----------------------
Borrower shall not further mortgage, encumber for debt, or pledge the
Trust Estate or any part thereof or any interest therein (including, without
limitation, any air or development rights).
SECTION 5.3 SINGLE PURPOSE.
--------------
Borrower shall not engage in any business other than the designing,
operating, owning, managing, developing, financing and leasing of the Trust
Estate.
SECTION 5.4 INFORMATION COVENANTS.
---------------------
(a) Borrower shall maintain, on a fiscal year basis in accordance with
consistently applied generally accepted accounting practices customarily used in
the real estate industry, complete and accurate books, accounts and records
reflecting all of the financial affairs of Borrower and all of the earnings and
expenses in connection with the operation of the Trust Estate or in connection
with any services, equipment or furnishings provided in connection with the
operation of the Trust Estate.
(b) Without expense to Lender, Borrower shall deliver to Lender
annually, within ninety (90) days after the close of each of Borrower's fiscal
years:
(i) an operating statement (including, without limitation, the
amount of rent escalations under the Qualifying Space Leases for such
fiscal year) and annual budget certified by a general partner, the chief
financial officer of the REIT or such other principal of the REIT familiar
with the Trust Estate and acceptable to Lender showing in reasonable detail
the income and expenses of the operations of the Trust Estate;
(ii) a statement of profit and loss for the immediately
preceding fiscal year of Borrower;
(iii) a complete copy of Borrower's financial statements
containing a balance sheet together with the related statement of surplus
and income statement for the immediately preceding fiscal year (A)
certified to Lender by a general partner or other principal of Borrower
acceptable to Lender and (B) reviewed by a firm of independent certified
public accountants satisfactory to Lender;
22
(iv) a complete copy of the REIT's financial statements
containing a balance sheet together with the related statement of surplus
and income statement for the immediately preceding fiscal year certified to
Lender by (A) the chief financial officer of the REIT and (B) a firm of
independent certified public accountants satisfactory to Lender; and
(v) a rent roll current to within thirty (30) days, showing the
tenants in occupancy, their square footage, their fixed and basic rents,
and their tax and operating escalations.
(c) Borrower's annual financial statements shall be accompanied by a
certificate of Borrower, dated as of the delivery of such statements to Lender,
stating that Borrower, to the best of its knowledge, knows of no Event of
Default that is continuing, or, if any such Event of Default is continuing,
specifying the nature and period of existence thereof and what action Borrower
has taken or proposes to take with respect thereto, and, except as otherwise
specified, stating that Borrower has fulfilled all its obligations under this
Agreement and the other Loan Documents that are required to be fulfilled on or
prior to the date of such certificate.
(d) Borrower shall deliver or cause to be delivered to Lender, no
later than ninety (90) days after the end of (i) Borrower's first three fiscal
quarters, a balance sheet as of the last day of such quarter and a statement of
profit and loss for such quarter, in each case reviewed by a firm of independent
certified public accountants acceptable to Lender, and (ii) the REIT's first
three fiscal quarters, a balance sheet as of the last day of such quarter and a
statement of profit and loss for such quarter.
(e) Lender or its designee will be permitted (but shall in no event be
required) upon not less than ten (10) days' prior notice to Borrower (but in no
event more often than once each calendar quarter unless an Event of Default
shall have occurred, in which event the foregoing limitation shall not apply) to
examine such books and records and all supporting vouchers and data at the
office of Borrower with respect to the Trust Estate and make such copies or
extracts thereof at Borrower's expense as Lender or its designee shall
reasonably desire. All information obtained by Lender in its review or
examination of Borrower's books and records pursuant to this Section 5.4 shall
be confidential and solely for the benefit of Lender and any Loan Participant.
(f) Borrower shall furnish to Lender (i) within thirty (30) days after
request therefor such further detailed information covering the operation of the
Trust Estate and the financial affairs of Borrower, its partners and the REIT as
may be reasonably requested by
23
Lender, and (ii) promptly upon their becoming available, copies of any
registration statements and any amendments and supplements thereto, and any
regular and periodic reports, if any, filed by the REIT with any securities
exchange or with the Securities and Exchange Commission or any governmental
authority succeeding to any or all of the functions of the said Commission.
SECTION 5.5 REIMBURSABLE EXPENSES.
---------------------
(a) Borrower shall reimburse Lender for all Out-of-Pocket Costs in
connection with (i) any amendment, modification or supplement to any of the Loan
Documents or any agreement or instrument delivered in connection herewith or
therewith, (ii) any waiver of any provision of this Agreement, any of the Loan
Documents or any agreement or instrument delivered in connection herewith or
therewith, (iii) any restructuring of the terms of any of the Loan Documents or
any agreement or instrument delivered in connection herewith or therewith, (iv)
any nondisturbance agreements or other documents delivered by Borrower to Lender
for review and approval, and (v) the enforcement of the Loan Documents or any
agreement or instrument delivered in connection herewith or therewith from and
after the occurrence and during the continuance of an Event of Default or
following an acceleration of the Loan. All of the foregoing expenses shall be
reimbursed by Borrower whether or not Lender gives notice to Borrower of any
Event of Default under this Agreement or takes any other action to enforce the
provisions of any of the Loan Documents or any agreement or instrument delivered
in connection herewith and therewith.
(b) Borrower shall pay any and all stamp and other taxes and fees
payable or determined to be payable in connection with the execution, delivery,
filing, recording and enforcement of any of the Loan Documents or any agreement
or instrument delivered in connection herewith or therewith and shall save
Lender harmless from and against any and all liabilities with respect to or
resulting from any delay in paying or failure to pay such taxes and fees.
(c) All amounts payable pursuant to this Section 5.5 shall be due and
payable not later than ten (10) Business Days following written demand by
Lender, together with interest thereon (i) if Lender has actually paid such
amount, at the Prime Rate from the date of demand therefor through the date
which is ten (10) Business Days after demand therefor (the "DUE DATE"), and (ii)
whether or not Lender has actually paid such amount, at the Involuntary Rate
from the Due Date through the date of payment by Borrower. The obligation to
pay such amounts shall survive the repayment of the Loan and shall continue in
full force and effect so long as the possibility of any such liability, claims
or losses pursuant to this Section 5.5 exists.
24
SECTION 5.6 PRESERVATION OF EXISTENCE.
-------------------------
(a) Each of Borrower, BP LLC and the Operating Partnership shall do
all things necessary to preserve and keep in full force and effect its
existence, franchises, rights and privileges as a business or partnership under
the laws of the District of Columbia or the State of Delaware, as applicable,
and will comply with all regulations, rules, statutes, orders and decrees of any
Governmental Authority or court applicable to the Trust Estate or any part
thereof, subject, however, to Borrower's right to contest such regulations,
rules, statutes, orders and decrees pursuant to Section 1.11 of the Amended and
Restated Deed of Trust.
(b) Borrower shall maintain in good repair, working order and
condition, subject to normal wear and tear, the Trust Estate and all material
properties and assets from time to time owned by it and used in or necessary for
the operation of its business, and make all reasonable repairs, replacements,
additions and improvements thereto.
SECTION 5.7 FUTURE TENANT ESTOPPEL CERTIFICATES.
-----------------------------------
(a) Once during the Loan Term, Borrower shall, within forty-five (45)
days following request by Lender, deliver to Lender estoppel certificates
prepared by Lender with respect to any Major Lease (as defined in the Amended
and Restated Deed of Trust) and shall use all reasonable efforts to deliver to
Lender such estoppel certificates with respect to any or all of the Qualifying
Space Leases, which estoppel certificates shall be executed by Borrower and each
other party to the appropriate Qualifying Space Lease, stating (i) that the
Qualifying Space Lease is unmodified (or stating the modification(s), if any)
and in full force and effect, (ii) whether or not, to the best knowledge of each
party to such Qualifying Space Lease, any party to such Qualifying Space Lease
is in default in any respect under such Qualifying Space Lease, and, if so,
specifying such default, and (iii) any other matters that may be reasonably
requested by Lender. If, after reasonable efforts, Borrower is unable to obtain
an estoppel certificate from any of its tenants, Borrower shall deliver
Borrower's certificate to Lender as to the matters set forth in clauses (i),
(ii) and (iii) and shall deliver such tenant's estoppel certificate to Lender
within two (2) Business Days after receiving it.
(b) On not more than three (3) occasions during the Loan Term,
Borrower shall, within ten (10) days after receipt in writing of a request by
Lender, execute and deliver Borrower's certificate stating that (i) the
Qualifying Space Leases are unmodified (or stating the modification(s)if any)
and in full force and effect, and (ii) all rents due under Qualifying Space
Leases have been paid when due, or if not, specifying the Qualifying Space
Leases under which rents have not been paid when due.
25
SECTION 5.8 TRANSFERS OF PREMISES.
---------------------
Borrower will not cause, permit or suffer a Transfer of Premises,
other than to a Permitted Transferee, without the prior written consent of
Lender, which consent shall not be unreasonably withheld or delayed. For
purposes of this Section 5.8, Lender shall consider, by way of illustration and
not in limitation, the following factors in its determination of granting
consent to any such Transfer of Premises: (a) the financial condition of the
proposed transferee; (b) the general reputation in the community of the proposed
transferee; and (c) the management and real estate experience of the proposed
transferee. For purposes of this Section 5.8, if Lender has not responded to
Borrower's request for consent within fifteen (15) Business Days following
receipt thereof, Lender's rights regarding prior consent shall be deemed waived
unless, prior to the expiration of such fifteen (15) day period, Lender has
requested further information concerning such proposed transferee as in its
reasonable judgment is necessary to evaluate Borrower's request, in which event
Lender shall have an additional fifteen (15) day period following receipt of
such additional information by Lender in which to approve or disapprove the
proposed transferee. If Lender has not responded within the first fifteen (15)
Business Day period or the additional fifteen (15) day period referred to in the
preceding sentence, Lender shall be deemed to have waived its right to so
consent.
SECTION 5.9 AMENDMENTS TO LEASES.
--------------------
Borrower will not, without the prior written consent of Lender, enter
into, or agree to enter into, any material amendments, modifications or
supplements, or any agreement which would have the effect of a material
amendment, modification or supplement, to any Qualifying Space Lease.
ARTICLE VI
EVENTS OF DEFAULT; REMEDIES
---------------------------
SECTION 6.1 EVENTS OF DEFAULT.
-----------------
Each of the following specified events shall constitute an "EVENT OF
DEFAULT" under this Agreement whether the occurrence of such event shall be
voluntary or involuntary or come about or be affected by operation of law or
otherwise:
26
(a) Any representation, warranty or statement made by Borrower in any
Loan Document or any certificate, document, financial or other statement given
in connection with the Loan, shall prove to have been untrue or incorrect in any
material respect when made and the existence of the facts constituting such
untruth or incorrectness shall have a material and adverse effect upon the value
of the Trust Estate or Lender's security for the Loan or the Loan Amount; or
(b) Borrower shall fail (i) to make any payment of principal of the
Replacement Note when due, or (ii) to make any payment of interest or any other
sum required to be paid by Borrower under the Replacement Note within five (5)
Business Days following written notice from Lender to Borrower, or (iii) to make
any other payment to Lender required to be made hereunder or under any other
Loan Document within ten (10) days following written notice from Lender to
Borrower; or
(c) Borrower shall mortgage, encumber for debt or pledge the Trust
Estate in violation of Section 5.2 hereof, the Amended and Restated Deed of
Trust or any other Loan Document; or
(d) Except as otherwise specified in this Section 6.1, Borrower shall
fail to perform or observe any other covenant, term or agreement on its part
contained in this Agreement, which failure shall have continued unremedied for
thirty (30) days after notice thereof shall have been given to Borrower by
Lender, provided, however, that if, in Lender's reasonable judgment, the failure
-------- -------
referred to in this paragraph (d) is curable by Borrower but not within said
thirty (30) day period, then an Event of Default shall not be deemed to have
occurred hereunder so long as (i) Borrower commences remedial action promptly
after notice and (ii) Borrower pursues such remedial action to completion with
due diligence and dispatch in Lender's reasonable judgment; or
(e) Any of Borrower, BP LLC or the Operating Partnership or any such
Entity's successors or assigns, or the REIT (collectively, a "SIGNIFICANT
ENTITY") shall file a voluntary petition seeking an order for relief under Title
11 of the United States Code, or any Significant Entity shall be adjudicated a
debtor, bankrupt or insolvent, or shall file any petition or answer seeking,
consenting to or acquiescing in any order for relief, reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under the present or any future federal bankruptcy act or any other
present or future applicable federal, state or other statute or law (foreign or
domestic), or shall file an answer admitting or failing to deny the material
allegations of a petition against it for any such relief or shall admit in
writing its inability to pay its debts as they mature, or shall make an
assignment for the benefit of creditors, or shall seek or consent to or
acquiesce in the appointment of any trustee, receiver,
27
examiner, sequestrator, custodian or liquidator or similar official of any
Significant Person; or if, within sixty (60) days after the commencement of any
such proceeding, whether by the filing of a petition or otherwise, seeking any
order for relief, reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future federal
bankruptcy act or any other present or future applicable federal, state or other
statute or law (foreign or domestic), such proceeding shall not have been
dismissed, or if, within sixty (60) days after the appointment (without the
consent or acquiescence of such Significant Entity) of any trustee, receiver or
liquidator of any Significant Entity, such appointment shall not have been
vacated or otherwise discharged, or if any execution or attachment issued
against such Significant Entity shall not have been discharged or removed within
sixty (60) days of its issuance; or
(f) The termination, liquidation or dissolution or the commencement of
proceedings for the liquidation or dissolution of any Significant Entity (unless
immediately reconstituted pursuant to the provisions of its partnership
agreement or applicable law or in connection with a Transfer of Borrower to a
Permitted Transferee) shall occur; or
(g) Borrower shall, in violation of this Agreement, the Amended and
Restated Deed of Trust or any other Loan Document, cause or permit any Transfer
of Premises to occur or shall enter into any agreement to effect the same; or
(h) (i) Either of BP LLC or the Operating Partnership shall
cease to be general partners of Borrower, or (ii) Borrower shall admit any
partners in addition to BP LLC and the Operating Partnership as general
partners, or (iii) the Operating Partnership and the REIT shall together own
less than 100% of the membership interests in BP LLC, or (iv) the REIT directly
or indirectly shall cease to be the sole general partner of the Operating
Partnership.
SECTION 6.2 REMEDIES.
--------
(a) If any Event of Default shall occur and be continuing, all
obligations of Lender under this Agreement, at the option of Lender, shall cease
and terminate, and Lender may declare the entire outstanding principal amount of
the Loan, including interest thereon and any other fees, costs and charges then
payable under any of the Loan Documents, immediately due and payable, whereupon
the same shall become immediately due and payable, without presentment, protest
or further demand or notice of any kind, all of which are hereby expressly
waived by Borrower; and, upon the occurrence and continuance of an Event of
Default or at any time following Lender's acceleration of the Loan, Lender may
immediately exercise any and all other rights, remedies and recourse available
to it at law or in equity or under any of the other Loan Documents including,
without limitation, the right to foreclose on any and
28
all liens and security interests securing repayment of the Loan Amount under the
Amended and Restated Deed of Trust and the other Loan Documents.
(b) Notwithstanding anything to the contrary contained herein, if
Borrower shall fail, refuse or neglect to make any payment or perform any act
required under the Loan Documents, Lender may, at its option and without any
obligation, at any time (including prior to the expiration of any grace period
related thereto), and without waiving or releasing any other right, remedy or
recourse Lender may have in connection therewith, make such payments or perform
such acts for the account of and at the expense of Borrower, and shall have the
right (to the extent Borrower has the power to grant such right), to enter upon
the Trust Estate and to take all action with respect to the Trust Estate as
Lender may deem desirable.
(c) Borrower hereby indemnifies Lender against all liability incurred
or accruing by reason of any acts performed by Lender pursuant to the Loan
Documents, except to the extent that the same shall have been caused by the
wilful misconduct or gross negligence of Lender or its employees and agents and
shall not be covered by the insurance required to be carried by Borrower under
the Loan Documents. Lender shall give Borrower reasonably prompt notice of any
threatened or actual liability giving rise to the right of indemnification set
forth herein and upon the receipt of such notice, Borrower shall diligently
defend Lender against such liability by counsel reasonably satisfactory to
Lender, at Borrower's sole cost and expense, provided, however, that Lender may
-------- -------
engage its own counsel, at its expense, to participate in said defense, and in
such event, the respective counsel for Borrower and Lender shall cooperate with
each other with respect thereto (it being understood that Borrower's counsel
shall control such defense) and shall promptly provide each other with copies of
all papers filed in such case or otherwise requested. Lender shall not
compromise or settle any action, suit or proceeding against which Lender is
indemnified hereunder without the consent of Borrower unless Lender waives its
right to indemnification under this Section. All sums determined to be payable
by Borrower to Lender by reason of the foregoing indemnity pursuant to a final
non-appealable order of a court of competent jurisdiction or otherwise shall be
due and payable by Borrower to Lender within five (5) Business Days after demand
therefor or on such later date as may be specifically set forth in such demand,
and if such sums are not timely paid, said sums shall bear interest at the
Involuntary Rate from the date such payment was due through the date of payment.
(d) Notwithstanding anything to the contrary contained herein, in no
event shall Lender be obligated to attempt to use, operate, occupy or manage the
Trust Estate or any part thereof or to perform any of the terms, conditions and
agreements herein or in any of the other Loan Documents or in any other
documents on the part of Borrower to be
29
performed, and Lender shall have no liability whatsoever to Borrower or any
other person or Entity (other than by reason of its gross negligence or wilful
misconduct) for failing, attempting or ceasing to perform the same, or for the
manner of performing or attempting to perform the same, or any part thereof.
SECTION 6.3 INTEREST GUARANTY.
-----------------
Notwithstanding any other provision of this Amended and Restated Loan
Agreement or any other Loan Document, in no event shall any default or event of
default under the Amended and Restated Interest Guaranty or the Supplemental
Guaranty, or any other breach thereof by any party thereto, be a default or
Event of Default under this Agreement or any of the other Loan Documents (other
than the Amended and Restated Interest Guaranty or the Supplemental Guaranty).
ARTICLE VII
MISCELLANEOUS
-------------
SECTION 7.1 EXPENSES.
--------
Borrower shall pay, as and when due, all Out-of-Pocket Costs and all
costs and expenses incurred by Borrower or Lender in connection with the Loan
and the preparation, amendment, administration and enforcement of the Loan
Documents including, without limitation, the fees and expenses set forth in
Section 5.5 hereof, document recording fees, mortgage recording taxes (including
any such costs associated with recording tax audits or investigations demanded
or conducted by a state or local tax authority with respect to the Amended and
Restated Deed of Trust) transfer taxes, license and permit fees, appraisal fees,
costs of environmental inspections, filing fees, title premiums and other fees
of Lender's title insurance company.
SECTION 7.2 ENTIRE AGREEMENT.
----------------
This Agreement, taken together with all of the other Loan Documents
and all certificates and other documents delivered by Borrower to Lender,
embodies the entire agreement with respect to the subject matter hereof, and
supersedes or incorporates all prior negotiations or agreements written and
oral.
SECTION 7.3 COUNTERPARTS.
------------
30
This Agreement may be executed in any number of counterparts with the
same effect as if the parties hereto had signed the same document. All such
counterparts shall constitute one instrument.
SECTION 7.4 ASSIGNABILITY AND PARTICIPATION.
-------------------------------
Lender may assign the Replacement Note, this Agreement, and/or the
other Loan Documents, in whole or in part, and Lender may grant to others such
participatory rights and interests herein and therein as Lender, in its sole
discretion, may elect, provided that (a) Sanwa shall, at all times, administer
--------
the Loan and retain the authority, either as agent or otherwise, to exercise or
direct the exercise of Lender's rights under the Loan Documents (as such, Sanwa
shall be defined as the "LEAD LENDER"), and (b) Borrower shall not be required
to obtain consents or approvals or otherwise deal directly with any party other
than Sanwa with respect to the Loan or the provisions of any of the Loan
Documents. Lender shall give notice to Borrower of any such assignment or
grant, and Borrower shall pay to Lender increased costs actually incurred by any
such participating institution subject to the provisions and limitations more
particularly set forth in the Replacement Note.
SECTION 7.5 GOVERNING LAW; VENUE; JURISDICTION.
----------------------------------
The Replacement Note, this Agreement and the other Loan Documents are
to be governed by and construed in accordance with the laws of the District of
Columbia, but without consideration of the conflicts of law provisions thereof.
By its execution and delivery of the Replacement Note and this Agreement,
Borrower shall be deemed to have agreed that the appropriate venue and
jurisdiction for any litigation pertaining to the Loan, the Replacement Note or
the Loan Documents shall be in the District of Columbia, and that the
appropriate location for any foreclosure sale pertaining to the collateral
described in the Loan Documents shall be in the District of Columbia.
SECTION 7.6 SEVERABILITY.
------------
If any of the terms and provisions specified herein is held by a court
of law to be in violation of any applicable local, state or federal ordinance,
statute, law, administrative or judicial decision, or public policy, and if such
court should declare such term or provision to be illegal, invalid, unlawful,
void, voidable, or unenforceable as written, then such provision shall be given
full force and effect to the fullest possible extent that it is legal, valid and
enforceable, and the remainder of the terms and provisions herein, shall be
construed as if such illegal, invalid, unlawful, void, voidable or unenforceable
term or provision was not
31
contained therein, and that the rights, obligations and interests of Borrower
and Lender under the remainder of this Agreement, shall continue in full force
and effect.
SECTION 7.7 SUCCESSORS AND ASSIGNS.
----------------------
All covenants and agreements herein shall bind the respective
successors and assigns of Borrower and Lender (provided, that Borrower shall not
--------
be permitted to transfer or assign its rights and obligations hereunder or under
the other Loan Documents except as expressly permitted by the provisions of the
Loan Documents), and all such covenants shall inure to the benefit of Lender and
Borrower and their respective nominees, successors and assigns.
SECTION 7.8 SETOFF.
------
Borrower hereby waives any and all rights of setoff with respect to
principal and interest due on the Replacement Note and any other payments due
Lender under the Loan Documents, including rights of setoff with respect to the
Replacement Note and the Loan Documents which may arise from claims,
transactions or occurrences heretofore unknown to Borrower.
SECTION 7.9 TIME OF THE ESSENCE.
-------------------
Time is of the essence with regard to Borrower's performance under the
terms and provisions of this Agreement, the other Loan Documents and any
amendment, modification or revision hereof or thereof, subject, however, to the
applicable grace periods, if any, set forth in the Loan Documents. No extension
of time for the payment of the Loan made by agreement with any person now or
hereafter liable for payment of the Loan Amount shall operate to release,
discharge, modify, change or affect the original liability of Borrower under
this Agreement, either in whole or in part.
SECTION 7.10 HEADINGS.
--------
The Table of Contents, and the titles and headings of Articles and
Sections of this Agreement are intended for convenience only, and shall not in
any way affect the meaning or construction of any provision of this Agreement.
SECTION 7.11 NOTICES.
-------
32
Except as may otherwise be provided herein, any notice, request,
demand, instruction or other communication required by the Loan Documents to be
given to Borrower or Lender shall be in writing and shall be either (a)
personally delivered to the parties named below by A messenger service regularly
retaining receipts for such delivery, (b) sent by registered or certified mail,
return receipt requested, or (c) delivered by a reputable air courier service
such as Federal Express, Express Mail, Airborne or Xxxxx Air, shall be effective
upon delivery thereof to the addressees and shall be addressed to the parties as
set forth below:
To Borrower:
c/o Boston Properties, Inc.
000 X Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attn: Office of Regional Counsel
Telecopier No.: (000) 000-0000
With a copy to:
Boston Properties, Inc.
0 Xxxxxxxxx Xxxxxx
Xxxxxx Xxxxxxxxxxxxx, 00000
Attn: General Counsel
Telecopier No.: (000) 000-0000
And:
Xxxxxxx, Procter & Xxxx, LLP
Exchange Place
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxxx, Esq.
Telecopier No.: (000) 000-0000
To Lender:
The Sanwa Bank Limited,
New York Branch
Park Avenue Plaza
00 Xxxx 00xx Xxxxxx
00
Xxx Xxxx, XX 00000
Attn: Xx. Xxxx X. Xxxx
Telecopier No.: (000) 000-0000
With a copy to:
Winston & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxx, Esq.
Telecopier No.: (000) 000-0000
If Lender or Borrower desires to change its address for the purpose of receipt
of notice, or to change the other party to receive a copy of notice, such notice
or change of address or recipient shall be given in the manner specified herein.
However, unless and until such written notice of change is actually received,
the last address and addressee as stated by written notice, or provided herein
if no written notice of change has been received, shall be deemed to continue in
effect for all purposes hereunder. Any notice given in accordance with the
terms hereof, the delivery of which is refused by the addressee, shall be
effective at the time of such attempted delivery.
SECTION 7.12 SUCCESSIVE REMEDIES.
-------------------
No power or remedy herein conferred is exclusive of or shall prejudice
any other power or remedy of Lender given by law or by the terms of any of the
other Loan Documents. Each such power or remedy may be exercised by Lender from
time to time as often as it deems necessary.
SECTION 7.13 NO-WAIVER.
---------
Any waiver by Lender of any of the terms, provisions or conditions of
this Agreement or any of the other Loan Documents shall not be deemed to be a
waiver of the same or any other term, provision or condition thereof and Lender
shall have the right at any time thereafter to insist upon strict performance of
any and all of the same.
SECTION 7.14 ESTOPPEL CERTIFICATES/NONDISTURBANCE/OTHER AGREEMENTS.
-----------------------------------------------------
34
Within ten (10) Business Days after request by Borrower, Lender shall
execute and deliver to Borrower (a) an estoppel certificate stating the
outstanding principal amount of the Loan and whether there exists any Event of
Default under any of the Loan Documents, and (b) a subordination, nondisturbance
and attornment agreement in substantially the form attached to the Amended and
Restated Deed of Trust as Schedule B, for any Qualifying Space Lease entered
into subsequent to the Closing Date. Upon repayment of the Loan Amount in full
and payment of all interest accrued thereon and any other fees, expenses, and
Out-of-Pocket Costs, incurred hereunder or under the other Loan Documents, then
upon Borrower's request, Lender shall execute and deliver to Borrower such
discharges, assignments and/or satisfactions as Borrower may reasonably request
and shall, upon reasonably notice, appear at the closing of such assignment,
discharge or satisfaction or make such other arrangements with respect thereto
as may be mutually satisfactory, provided that Borrower shall pay all Out-of-
--------
Pocket Costs with respect thereto.
SECTION 7.15 CROSS-DEFAULT.
-------------
Any Event of Default under this Agreement shall be deemed to be an
Event of Default under each of the Loan Documents, entitling Lender to exercise
any or all remedies available to Lender under the terms of any or all Loan
Documents.
SECTION 7.16 PURPOSE OF LOANS.
----------------
Borrower represents and warrants that the indebtedness evidenced by
the Replacement Note was obtained solely for the purpose of carrying on a
business or commercial activity. Nothing contained in the preceding sentence
shall be deemed to be a limitation of Borrower's use of the proceeds of the
Loan.
SECTION 7.17 INCONSISTENCIES WITH LOAN DOCUMENTS.
-----------------------------------
In the event of any conflict between this Agreement and the provisions
of any of the other Loan Documents, the provisions of this Agreement shall
control; provided, however, that any provision of any other Loan Documents which
-------- -------
imposes additional burdens on Borrower or restricts the rights of Borrower or
gives Lender additional rights or remedies shall not be deemed to be in conflict
or inconsistent with this Agreement and shall be given full force and effect.
35
SECTION 7.18 SURVIVAL.
--------
All of the representations, warranties, terms, covenants, agreements
and conditions contained in this Agreement shall survive the execution and
delivery of this Agreement and the other Loan Documents, and shall, unless
otherwise expressly provided, continue in full force and effect until the Loan,
together with interest thereon, and all other costs, charges and other sums
payable hereunder or thereunder, are paid in full.
SECTION 7.19 INDEMNIFICATION.
---------------
Borrower shall indemnify Lender for and hold Lender harmless from and
against, any and all claims, damages, losses, liabilities, Out-of-Pocket Costs
of any kind whatsoever (other than such Out-of-Pocket Costs which are the
responsibility of Lender pursuant to the terms of this Agreement) which Lender
may incur (or which may be claimed against Lender) by reason of, or in
connection with (a) the destruction of the Trust Estate (or any part thereof) in
a casualty for which insurance was required under the Loan Documents and was not
obtained and kept in full force and effect by Borrower, (b) all obligations,
covenants, representations and warranties of Borrower under the Amended and
Restated Deed of Trust relating to Hazardous Material to the full extent of any
losses or damages (including those resulting from diminution in the value of the
Trust Estate) incurred by Lender as a result of the existence of Hazardous
Material to the extent such Hazardous Material existed prior to the date Lender
has taken possession and has assumed control of the Trust Estate pursuant to the
Amended and Restated Deed of Trust, and (c) any action or proceeding to which
Lender is made a party by reason of Lender's holding of an interest in the Trust
Estate; provided, however, Borrower shall have no obligation to indemnify Lender
-------- -------
for any such claims, damages, losses, liabilities, costs or expenses arising by
reason of the gross negligence or willful misconduct of Lender. In case any
action, suit or proceeding is brought against Lender by reason of any such
occurrence, as a condition to Borrower's indemnity obligation under this Section
7.19, (a) Lender shall give prompt notice to Borrower of any such action, suit
or proceeding, (b) Borrower may, at Borrower's sole cost and expense, resist and
defend such action, suit or proceeding by counsel reasonably satisfactory to
Lender, and (c) if Borrower elects to defend such action, suit or proceeding,
Lender shall not compromise or settle any such action, suit or proceeding
without the consent of Borrower, unless Lender waives its right to the foregoing
indemnification.
SECTION 7.20 NO AGENCY, PARTNERSHIP OR JOINT VENTURE.
---------------------------------------
Lender is not the agent or representative of Borrower, and Borrower is
not the agent or representative of Lender. Borrower and Lender intend and agree
that the relationship
36
between them shall be solely that of creditor and debtor. Nothing herein nor the
acts of the parties hereto shall be construed to create a partnership or joint
venture between Borrower and Lender.
SECTION 7.21 NEGOTIATED DOCUMENT.
-------------------
Lender and Borrower acknowledge that the provisions and the language
of this Agreement and the other Loan Documents have been negotiated and are
reasonable in light of all circumstances attendant to the execution and delivery
of this Agreement, and agree that no provision of this Agreement or any other
Loan Document shall be construed against either Lender or Borrower by reason of
either Lender or Borrower having drafted such provision, this Agreement or any
other Loan Document.
SECTION 7.22 LIMITATION ON RECOURSE.
----------------------
Except for certain limited personal liability as specified below, it
is expressly understood and agreed that the extent of liability for payment by
Borrower of any sums due under this Agreement, the Replacement Note, the Amended
and Restated Deed of Trust or any of the other Loan Documents is limited to (a)
the Trust Estate, and all Revenues therefrom received by Borrower after the
occurrence of an Event of Default which are not applied to the Loan Amount or to
Expenses of the Trust Estate, and (b) proceeds of insurance on said Trust Estate
or proceeds on account of condemnation thereof (to the extent such proceeds are
not applied by Lender in restoration or repair of the Trust Estate pursuant to
the terms of the Amended and Restated Deed of Trust), Lender agreeing not to
look personally to Borrower, the general partners of Borrower (a "P-L"), the
partners, members, or shareholders of any general partner of Borrower (a "P-2"),
or the owners of partnership or membership interests, whether owned or held
directly or indirectly, as general or limited partners or members of a limited
liability company, in partners or members of the general partners of Borrower (a
"P-3"), for payment of any of such sums. Lender, for itself and its successors,
endorsees, participants and assigns, hereby waives any right to enforce
collection of any money judgment against any assets of Borrower, any X-0, X-0 xx
X-0, other than as set forth in clauses (a) and (b) above, whether by reason of
a judgment pursuant to an action brought under the Replacement Note or any
action in foreclosure or otherwise for a deficiency judgment against Borrower,
any X-0, X-0 xx X-0, other than as set forth in clauses (a) and (b) above.
However, notwithstanding the foregoing, Borrower and the general partners of
Borrower shall be fully subject to personal liability (a) for fraud and (b) to
the extent that the proceeds of insurance on the Trust Estate, the proceeds on
account of condemnation thereof, or Revenues of the Trust Estate are received by
Borrower or its partners after the occurrence of an Event of Default and are not
applied to the Loan Amount, the Expenses of the Trust Estate or, in respect of
insurance or
37
condemnation proceeds, in restoration or repair of the Trust Estate pursuant to
the terms of the Amended and Restated Deed of Trust. The foregoing provisions
shall not in any way be deemed to release, affect or impair the indebtedness and
obligations evidenced by the Replacement Note or the security therefor, or
Lender's right to enforce its remedies under the Amended and Restated Deed of
Trust or any other of the Loan Documents by any action, including, without
limitation, an action brought under the Replacement Note or any foreclosure
under the Amended and Restated Deed of Trust. Furthermore, none of the foregoing
provisions shall in any way limit the liability of the Guarantors under the
Amended and Restated Interest Guaranty or which any person has assumed by a
separate instrument in the nature of a guarantee of any obligation undertaken in
connection with the Loan.
SECTION 7.23 CONSTRUCTION.
------------
Except as Lender may otherwise agree in writing or as may otherwise be
provided under applicable law, any default or other condition upon which the
existence of an Event of Default shall be predicated (and, thus, the Event of
Default predicated thereon) shall be deemed to be "continuing" for all purposes
of this Loan Agreement as provided in Section 4.20(b) of the Amended and
Restated Deed of Trust.
SECTION 7.24 SURVIVAL OF ACCRUED AMOUNTS.
---------------------------
Any and all Out-of-Pocket Costs, costs, expenses, fees or other
amounts, including without limitation any principal or accrued interest with
respect to the Loan and all accrued Funding Costs, which shall be due and
payable under the terms of the Original Loan Agreement, the Original Note, or
any of the other Loan Documents which shall not be paid in full on the Closing
Date, shall survive and continue to be due and payable by Borrower under and in
respect of this Agreement, the Replacement Note or such of the other Loan
Documents as may be applicable.
SECTION 7.25 CONFIDENTIALITY.
---------------
The Projections supplied to Lender by Borrower are solely for the use
of Lender and Lender agrees to keep the Projections confidential and shall not
supply the Projections or any part thereof to any person not employed or
affiliated with Lender; provided, however, that Lender and the Loan Participants
-------- -------
may supply the Projections to any bank or financial institution which has
purchased or is considering purchasing a participation in the Loan.
Notwithstanding anything to the contrary set forth herein, the confidentiality
obligations referred to in this Section 7.25 shall not apply to (i) information
publicly known through no
38
wrongful act of Lender and (ii) information required to be disclosed by
applicable law, regulation or judicial or regulatory process.
[End of Text]
39
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the day and year first written above.
SQUARE 36 OFFICE JOINT VENTURE,
a District of Columbia General Partnership
By: Boston Properties LLC
By:_________________________________
THE SANWA BANK LIMITED,
NEW YORK BRANCH, a Japanese
banking institution
By:_________________________________
Name:
Title:
