EXECUTION COPY
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$250,000,000 Senior Secured Credit Facility
CREDIT AGREEMENT
Dated as of December 28, 2000
by and among
PREIT ASSOCIATES, L.P.,
as Borrower,
PENNSYLVANIA REAL ESTATE INVESTMENT TRUST,
as Parent,
THE FINANCIAL INSTITUTIONS PARTY HERETO
AND THEIR ASSIGNEES UNDER SECTION 13.5.(d),
as Lenders,
U.S. BANK NATIONAL ASSOCIATION, a national banking association,
as the Syndication Agent,
FLEET NATIONAL BANK, a national banking association,
as the Documentation Agent
and
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Administrative Agent and Sole Lead
Arranger
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TABLE OF CONTENTS*
Article I.
Definitions...........................................................2
Section 1.1. Definitions.............................................2
Section 1.2. General; References to Times............................2
Article II. Credit Facilities..................................................2
Section 2.1. Revolving Loans.........................................2
Section 2.2. Letters of Credit.......................................3
Section 2.3. Swingline Loans.........................................7
Section 2.4. Rates and Payment of Interest on Loans..................9
Section 2.5. Number of Interest Periods.............................10
Section 2.6. Repayment of Loans.....................................10
Section 2.7. Late Charges...........................................10
Section 2.8. Prepayments............................................11
Section 2.9. Continuation...........................................12
Section 2.10. Conversion.............................................12
Section 2.11. Notes..................................................12
Section 2.12. Voluntary Reductions of the Revolving Commitment and
Construction Commitment................................13
Section 2.13. Expiration or Maturity Date of Letters of Credit Past
Revolving Credit Termination Date......................13
Section 2.14. Increase in Revolving Commitments......................14
Section 2.15. Extension of Revolving Credit Termination Date.........14
Section 2.16. Term Loan Conversion...................................15
Article III. Payments, Fees and Other General Provisions......................16
Section 3.1. Payments...............................................16
Section 3.2. Pro Rata Treatment.....................................16
Section 3.3. Sharing of Payments, Etc...............................17
Section 3.4. Several Obligations....................................18
Section 3.5. Minimum Amounts........................................18
Section 3.6. Fees...................................................18
Section 3.7. Computations...........................................20
Section 3.8. Usury..................................................20
Section 3.9. Statements of Account..................................21
Section 3.10. Defaulting Lenders.....................................21
Section 3.11. Taxes..................................................22
Article IV. Borrowing Base Properties.........................................23
Section 4.1. Borrowing Base Properties..............................23
Section 4.2. Frequency of Appraisals................................31
Section 4.3. Frequency of Calculations of Borrowing Base............32
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* This Table of Contents is not part of the Credit Agreement and is provided as
a convenience only.
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Article V. Construction Loan Facility.........................................33
Section 5.1. Construction Loans; Submissions for Acceptance as a
Construction Property..................................33
Section 5.2. Requests for and Disbursements of Construction
Advances...............................................45
Section 5.3. Inspection.............................................49
Section 5.4. Extension of Construction Loan Maturity Date(s)........51
Section 5.5. General Terms and Provisions...........................52
Article VI. Yield Protection, Etc.............................................53
Section 6.1. Additional Costs; Capital Adequacy.....................53
Section 6.2. Suspension of LIBOR Loans..............................54
Section 6.3. Illegality.............................................55
Section 6.4. Compensation...........................................55
Section 6.5. Treatment of Affected Loans............................55
Section 6.6. Change of Lending Office...............................56
Article VII. Conditions Precedent.............................................56
Section 7.1. Initial Conditions Precedent...........................56
Section 7.2. Conditions Precedent to All Loans and Letters of
Credit.................................................59
Section 7.3. Conditions to Conversion to Term Loans.................59
Section 7.4. Conditions as Covenants................................60
Article VIII. Representations and Warranties..................................60
Section 8.1. Representations and Warranties.........................60
Section 8.2. Survival of Representations and Warranties, Etc........66
Article IX. Affirmative Covenants.............................................66
Section 9.1. Financial Reporting and Other Information..............66
Section 9.2. Preservation of Existence and Similar Matters..........71
Section 9.3. Compliance with Applicable Law.........................71
Section 9.4. Maintenance of Property................................71
Section 9.5. Conduct of Business....................................71
Section 9.6. Insurance..............................................71
Section 9.7. Payment of Taxes and Claims............................73
Section 9.8. Books and Records; Visits and Inspections..............73
Section 9.9. Use of Proceeds; Letters of Credit.....................73
Section 9.10. Environmental Matters..................................74
Section 9.11. Further Assurances.....................................74
Section 9.12. Material Contracts.....................................74
Section 9.13. REIT Status............................................75
Section 9.14. Exchange Listing.......................................75
Section 9.15. Guarantors.............................................75
Section 9.16. Construction Guarantors................................76
Article X. Negative Covenants.................................................78
Section 10.1. Financial Covenants....................................78
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Section 10.2. Restricted Payments...................................80
Section 10.3. Restrictions on Intercompany Transfers................81
Section 10.4. Mergers, Acquisitions and Sales of Assets.............81
Section 10.5. Fiscal Year...........................................82
Section 10.6. Modifications of Organizational Documents and Material
Contracts.............................................82
Section 10.7. Transactions with Affiliates..........................83
Section 10.8. ERISA Exemptions......................................83
Section 10.9. Negative Pledge.......................................83
Article XI. Default...........................................................83
Section 11.1. Events of Default.....................................83
Section 11.2. Remedies Upon Event of Default........................87
Section 11.3. Termination of Commitments Upon Certain Defaults......88
Section 11.4. Marshaling; Payments Set Aside........................89
Section 11.5. Allocation of Proceeds................................89
Section 11.6. Letter of Credit Collateral Account...................90
Section 11.7. Performance by Agent..................................91
Section 11.8. Rights Cumulative.....................................92
Article XII. The Agent........................................................92
Section 12.1. Authorization and Action..............................92
Section 12.2. Agent's Reliance, Etc.................................92
Section 12.3. Notice of Defaults....................................93
Section 12.4. Xxxxx Fargo as Lender.................................93
Section 12.5. Approvals of Lenders..................................94
Section 12.6. Lender Credit Decision, Etc...........................94
Section 12.7. Indemnification of Agent..............................95
Section 12.8. Collateral Matters; Protective Advances...............95
Section 12.9. Post-Foreclosure Plans................................97
Section 12.10. Successor Agent.......................................98
Section 12.11. Syndication and Documentation Agents..................98
Article XIII. Miscellaneous...................................................98
Section 13.1. Notices...............................................98
Section 13.2. Expenses.............................................100
Section 13.3. Setoff...............................................101
Section 13.4. Litigation; Jurisdiction; Other Matters; Waivers.....101
Section 13.5. Successors and Assigns...............................102
Section 13.6. Amendments...........................................104
Section 13.7. Nonliability of Agent and Lenders....................106
Section 13.8. Confidentiality......................................106
Section 13.9. Indemnification......................................107
Section 13.10. Termination; Survival................................108
Section 13.11. Severability of Provisions...........................108
Section 13.12. GOVERNING LAW........................................108
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Section 13.13. Counterparts.........................................109
Section 13.14. Obligations with Respect to Loan Parties.............109
Section 13.15. Limitation of Liability..............................109
Section 13.16. Entire Agreement.....................................109
Section 13.17. Construction.........................................109
Section 13.18. Time of the Essence..................................110
Section 13.19. NO NOVATION..........................................110
SCHEDULE 1.1. List of Loan Parties
SCHEDULE 4.1. List of Initial Borrowing Base Properties
SCHEDULE 8.1.(b) Ownership Structure
SCHEDULE 8.1.(f) Properties
SCHEDULE 8.1.(g) Existing Indebtedness
SCHEDULE 8.1.(h) Material Contracts
SCHEDULE 8.1.(i) Litigation
SCHEDULE 8.1.(j) Taxes
SCHEDULE 8.1.(y) Non-Guarantor Entities
SCHEDULE 10.1.(a) Equity Issuances
EXHIBIT A Form of Revolving Note
EXHIBIT B Form of Construction Note
EXHIBIT C Form of Extension Request
EXHIBIT D Form of Opinion of Counsel to the Borrower and the Guarantors
EXHIBIT E Form of Compliance Certificate
EXHIBIT F Form of Assignment and Acceptance Agreement
EXHIBIT G Form of Assignment of Leases and Rents
EXHIBIT H Form of Borrowing Base Certificate
EXHIBIT I Form of Disbursement Request
EXHIBIT J Form of Environmental Indemnity Agreement
EXHIBIT K-1 Form of Guaranty
EXHIBIT K-2 Form of Construction Guaranty
EXHIBIT L Form of Notice of Borrowing
EXHIBIT M Form of Notice of Continuation
EXHIBIT N Form of Notice of Conversion
EXHIBIT O Form of Notice of Swingline Borrowing
EXHIBIT P-1 Form of Property Management Contract Assignment
EXHIBIT P-2 Form of Agreement Regarding Property Contract Termination
EXHIBIT Q Form of Security Deed
EXHIBIT R Form of Swingline Note
EXHIBIT S Form of Joinder Agreement
EXHIBIT T Form of Disbursement Schedule
EXHIBIT U Form of Funds Transfer Agreement
EXHIBIT V Form of Pricing Certificate
EXHIBIT W Form of Non-Disturbance, Attornment, Estoppel and
Subordination Agreement
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THIS CREDIT AGREEMENT dated as of December 28, 2000, by and among PREIT
ASSOCIATES, L.P., a Delaware limited partnership (the "Borrower"), PENNSYLVANIA
REAL ESTATE INVESTMENT TRUST, a Pennsylvania business trust (the "Parent"), each
Subsidiary Borrower (as defined below) which becomes a party hereto pursuant to
the execution and delivery of a Joinder Agreement substantially in the form of
Exhibit S, each of the financial institutions initially a signatory hereto
together with their assignees pursuant to Section 13.5.(d), U.S. BANK NATIONAL
ASSOCIATION, a national banking association, as Syndication Agent (the
"Syndication Agent"), FLEET NATIONAL BANK, a national banking association, as
Documentation Agent (the "Documentation Agent"), and XXXXX FARGO BANK, NATIONAL
ASSOCIATION, as sole lead arranger and as Agent.
WHEREAS, pursuant to that certain Revolving Credit Loan Agreement dated
as of September 30, 1997 (as amended and in effect immediately prior to the date
hereof, the "Existing Credit Agreement"), by and among the Borrower, the
financial institutions party thereto as "Banks" (the "Existing Banks"), and
First Union National Bank, successor to CoreStates Bank, N.A., as Agent (the
"Existing Agent"), the Existing Banks and the Existing Agent made a $150,000,000
credit facility available to the Borrower;
WHEREAS, the Existing Lenders, the Existing Agent, the Borrower and
Xxxxx Fargo have entered into that certain Assignment and Acceptance Agreement
dated as of the date hereof pursuant to which such parties provided for, among
other things, (a) the assignment by certain of the Existing Lenders to Xxxxx
Fargo of a portion of the Existing Lenders' rights and obligations under the
Existing Credit Agreement and the Notes and other Loan Documents (as each such
term is defined in the Existing Credit Agreement) and (b) the replacement of the
Existing Agent with the Agent;
WHEREAS, Xxxxx Fargo, the Lenders, the Agent and the Borrower have
entered into that certain Assignment Agreement dated as of the date hereof
pursuant to which such parties provided for, among other things, (a) the
assignment by Xxxxx Fargo to certain of the Lenders of a proportionate amount of
Xxxxx Fargo's rights and obligations under the Existing Credit Agreement and the
Notes and other Loan Documents (as each such term is defined in the Existing
Credit Agreement) and (b) the amendment and restatement of the Existing Credit
Agreement; and
WHEREAS, the parties hereto desire to amend and restate the Existing
Credit Agreement on the terms and conditions contained herein, among other
things, to make available to the Borrower a $250,000,000 credit facility
consisting of (a) a $175,000,000 secured revolving credit facility, which
includes a $20,000,000 letter of credit subfacility and a $20,000,000 swingline
subfacility, and (b) a $75,000,000 secured construction loan facility, all on
the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto agree that the Existing Credit Agreement is amended and restated in its
entirety as follows:
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ARTICLE I. DEFINITIONS
Section 1.1. Definitions.
In addition to terms defined elsewhere herein, the capitalized terms
used herein shall have their respective defined meanings as set forth in Annex
I.
Section 1.2. General; References to Times.
Unless otherwise indicated, all accounting terms, ratios and
measurements shall be interpreted or determined in accordance with GAAP as in
effect as of the Agreement Date. References in this Agreement to "Sections",
"Articles", "Exhibits" and "Schedules" are to sections, articles, exhibits and
schedules herein and hereto unless otherwise indicated. references in this
Agreement to any document, instrument or agreement (a) shall include all
exhibits, schedules and other attachments thereto, (b) shall include all
documents, instruments or agreements issued or executed in replacement thereof,
to the extent permitted hereby and (c) shall mean such document, instrument or
agreement, or replacement thereto, as amended, supplemented, restated or
otherwise modified from time to time to the extent permitted hereby and in
effect at any given time. Wherever from the context it appears appropriate, each
term stated in either the singular or plural shall include the singular and
plural, and pronouns stated in the masculine, feminine or neuter gender shall
include the masculine, the feminine and the neuter. Unless explicitly set forth
to the contrary, a reference to "Subsidiary" means a Subsidiary of the Parent or
a Subsidiary of such Subsidiary and a reference to an "Affiliate" means a
reference to an Affiliate of the Borrower. Titles and captions of Articles,
Sections, subsections and clauses in this Agreement are for convenience only,
and neither limit nor amplify the provisions of this Agreement. Unless otherwise
indicated, all references to time are references to San Francisco, California
time.
ARTICLE II. CREDIT FACILITIES
Section 2.1. Revolving Loans.
(a) Generally. Subject to the terms and conditions hereof, during the
period from the Effective Date to but excluding the Revolving Credit Termination
Date, each Lender severally and not jointly agrees to make Revolving Loans to
the Borrower in an aggregate principal amount at any one time outstanding up to,
but not exceeding, the lesser of (i) the amount of such Lender's Revolving
Commitment and (ii) such Lender's Revolving Commitment Percentage of the
Borrowing Base. Subject to the terms and conditions of this Agreement, during
the period from the Effective Date to but excluding the Revolving Credit
Termination Date, the Borrower may borrow, repay and reborrow Revolving Loans.
Upon the Effective Date, all Loans (as defined under the Existing Credit
Agreement) then outstanding under the Existing Credit Agreement shall be deemed
to be Revolving Loans to the Borrower outstanding hereunder. As of the Effective
Date, such Revolving Loans shall be allocated among the Lenders in accordance
with their respective Pro Rata Shares. Each Lender agrees to make such payments
to the other Lenders upon the Effective Date in such amounts as are necessary to
effect such allocation. All such payments shall be made to the Agent for the
account of the Person to be paid.
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(b) Requesting Revolving Loans. The Borrower shall give the Agent
notice pursuant to a Notice of Borrowing of each borrowing of Revolving Loans.
Each Notice of Borrowing shall be delivered to the Agent before 9:00 a.m. (a) in
the case of LIBOR Loans, on the date three Business Days prior to the proposed
date of such borrowing and (b) in the case of Base Rate Loans, on the date one
Business Day prior to the proposed date of such borrowing. The Agent will
transmit by telecopy or other similar form of transmission the Notice of
Borrowing (or the information contained in such Notice of Borrowing) to each
Lender promptly upon receipt by the Agent. Each Notice of Borrowing shall be
irrevocable once given and binding on the Borrower.
(c) Disbursements of Loan Proceeds. No later than 9:00 a.m. on the date
specified in the Notice of Borrowing, each Lender will make available for the
account of its applicable Lending Office to the Agent, in immediately available
funds, the proceeds of the Revolving Loan or Revolving Loans to be made by such
Lender. With respect to Revolving Loans to be made after the Effective Date,
unless the Agent shall have been notified by any Lender prior to the specified
date of borrowing that such Lender does not intend to make available to the
Agent the Revolving Loan to be made by such Lender on such date, the Agent may
assume that such Lender will make the proceeds of such Loan available to the
Agent on the date of the requested borrowing as set forth in the Notice of
Borrowing and the Agent may (but shall not be obligated to), in reliance upon
such assumption, make available to the Borrower the amount of such Loan to be
provided by such Lender. Subject to satisfaction of the applicable conditions
set forth in Article VII. for such borrowing, the Agent will make the proceeds
of such borrowing available to the Borrower no later than 12:00 noon on the date
and at the account specified by the Borrower in such Notice of Borrowing.
Section 2.2. Letters of Credit.
(a) Letters of Credit. Subject to the terms and conditions of this
Agreement, the Agent, on behalf of the Lenders, agrees to issue for the account
of the Borrower during the period from and including the Effective Date to, but
excluding, the date 30 days prior to the Revolving Credit Termination Date, one
or more standby letters of credit (each a "Letter of Credit") up to a maximum
aggregate Stated Amount at any one time outstanding not to exceed the L/C
Commitment Amount.
(b) Terms of Letters of Credit. At the time of issuance, the amount,
form, terms and conditions of each Letter of Credit, and of any drafts or
acceptances thereunder, shall be subject to approval by the Agent and the
Borrower. Notwithstanding the foregoing, in no event may (i) the expiration date
of any Letter of Credit extend beyond the Revolving Credit Termination Date,
(ii) any Letter of Credit have an initial duration in excess of one year, (iii)
any Letter of Credit contain an automatic renewal provision (other than renewal
provisions which are automatic in the absence of a notice of non-renewal from
the Agent and which provide for renewal for periods not in excess of three years
in the aggregate), and (iv) a Letter of Credit provide that the Agent be
required to honor draws any time prior to three Business Days following
presentation. The initial Stated Amount of each Letter of Credit shall be at
least $10,000.
(c) Requests for Issuance of Letters of Credit. The Borrower shall give
the Agent written notice at least 5 Business Days prior to the requested date of
issuance of a Letter of Credit,
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such notice to describe in reasonable detail the proposed terms of such Letter
of Credit and the nature of the transactions or obligations proposed to be
supported by such Letter of Credit, and in any event shall set forth with
respect to such Letter of Credit (i) the proposed initial Stated Amount, (ii)
the beneficiary or beneficiaries, and (iii) the proposed expiration date. The
Borrower shall also execute and deliver such customary applications and
agreements for standby letters of credit, standby letter of credit agreements,
applications for amendment to letter of credit, and other forms as requested
from time to time by the Agent. Provided the Borrower has given the notice
prescribed by the first sentence of this subsection and delivered such
application and agreement referred to in the preceding sentence and subject to
the other terms and conditions of this Agreement, including the satisfaction of
any applicable conditions precedent set forth in Article VII. and payment of all
fees then payable under Section 3.6.(c), the Agent shall issue the requested
Letter of Credit on the requested date of issuance for the benefit of the
stipulated beneficiary. Upon the written request of the Borrower, the Agent
shall deliver to the Borrower a copy of (i) any Letter of Credit proposed to be
issued hereunder prior to the issuance thereof and (ii) each issued Letter of
Credit within a reasonable time after the date of issuance thereof. To the
extent any term of a Letter of Credit Document is inconsistent with a term of
any Loan Document, the term of such Loan Document shall control as to the Agent,
the Lenders and the Loan Parties.
(d) Reimbursement Obligations. Upon receipt by the Agent from the
beneficiary of a Letter of Credit of any demand for payment under such Letter of
Credit, the Agent shall promptly notify the Borrower of the amount to be paid by
the Agent as a result of such demand and the date on which payment is to be made
by the Agent to such beneficiary in respect of such demand. The Borrower hereby
absolutely, unconditionally and irrevocably agrees to pay and reimburse the
Agent for the amount of each demand for payment under such Letter of Credit at
or prior to the date on which payment is to be made by the Agent to the
beneficiary thereunder, without presentment, demand, protest or other
formalities of any kind. Upon receipt by the Agent of any payment in respect of
any Reimbursement Obligation, the Agent shall promptly pay to each Lender that
has acquired a participation therein under the second sentence of Section
2.2.(i) such Lender's Revolving Commitment Percentage of such payment.
(e) Manner of Reimbursement. Upon its receipt of a notice referred to
in the immediately preceding subsection (d), the Borrower shall be deemed to
have requested a borrowing of Revolving Loans (which shall be LIBOR Loans with
an Interest Period of one month) hereunder to finance its obligation to
reimburse the Agent for the amount of the related demand for payment , then (i)
if the applicable conditions contained in Article VII. would permit the making
of Revolving Loans, the requested Revolving Loans will be made in an amount
equal to the unpaid Reimbursement Obligation and the Agent shall give each
Lender prompt notice of the amount of the Revolving Loan to be made available to
the Agent not later than 11:00 a.m. and (ii) if such conditions would not permit
the making of Revolving Loans, the provisions of subsection (j) of this Section
shall apply.
(f) Effect of Letters of Credit on Revolving Commitments. Upon the
issuance by the Agent of any Letter of Credit and until such Letter of Credit
shall have expired or been terminated, the Revolving Commitment of each Lender
shall be deemed to be utilized for all purposes of this Agreement in an amount
equal to the product of (i) such Lender's Revolving Commitment
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Percentage and (ii) the sum of (A) the Stated Amount of such Letter of Credit
plus (B) any related Reimbursement Obligations then outstanding.
(g) Agent's Duties Regarding Letters of Credit; Unconditional Nature of
Reimbursement Obligations. In examining documents presented in connection with
drawings under Letters of Credit and making payments under such Letters of
Credit against such documents, the Agent shall only be required to use the same
standard of care as it uses in connection with examining documents presented in
connection with drawings under letters of credit in which it has not sold
participations and making payments under such letters of credit. The Borrower
assumes all risks of the acts and omissions of, or misuse of the Letters of
Credit by, the respective beneficiaries of such Letters of Credit. In
furtherance and not in limitation of the foregoing, neither the Agent nor any of
the Lenders shall be responsible for (i) the form, validity, sufficiency,
accuracy, genuineness or legal effects of any document submitted by any party in
connection with the application for and issuance of or any drawing honored under
any Letter of Credit even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any Letter of Credit, or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (iii) failure of the beneficiary of any
Letter of Credit to comply fully with conditions required in order to draw upon
such Letter of Credit; (iv) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telex, telecopy or
otherwise, whether or not they be in cipher; (v) errors in interpretation of
technical terms; (vi) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Letter of Credit, or of
the proceeds thereof; (vii) the misapplication by the beneficiary of any such
Letter of Credit, or the proceeds of any drawing under such Letter of Credit; or
(viii) any consequences arising from causes beyond the control of the Agent or
the Lenders. None of the above shall affect, impair or prevent the vesting of
any of the Agent's rights or powers hereunder. In this connection, the
obligation of the Borrower to reimburse the Agent for any drawing made under any
Letter of Credit shall be absolute, unconditional and irrevocable and shall be
paid strictly in accordance with the terms of this Agreement or any other
applicable Letter of Credit Document under all circumstances whatsoever,
including without limitation, the following circumstances: (A) any lack of
validity or enforceability of any Letter of Credit Document or any term or
provisions therein; (B) any amendment or waiver of or any consent to departure
from all or any of the Letter of Credit Documents; (C) the existence of any
claim, setoff, defense or other right which the Borrower may have at any time
against the Agent, any Lender, any beneficiary of a Letter of Credit or any
other Person, whether in connection with this Agreement, the transactions
contemplated hereby or in the Letter of Credit Documents or any unrelated
transaction; (D) any breach of contract or dispute between the Borrower, the
Agent, any Lender or any other Person; (E) any demand, statement or any other
document presented under a Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein or made in
connection therewith being untrue or inaccurate in any respect whatsoever; (F)
any non-application or misapplication by the beneficiary of a Letter of Credit
of the proceeds of any drawing under such Letter of Credit; (G) payment by the
Agent under the Letter of Credit against presentation of a draft or certificate
which does not strictly comply with the terms of the Letter of Credit; and (H)
any other act, omission to act, delay or circumstance whatsoever that might, but
for the provisions of this Section, constitute a legal or equitable defense to
or discharge of the Borrower's
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Reimbursement Obligations. Any action taken or omitted to be taken by the Agent
under or in connection with any Letter of Credit, if taken or omitted in the
absence of gross negligence or willful misconduct, shall not create against the
Agent any liability to the Borrower or any Lender.
(h) Amendments, Etc. The issuance by the Agent of any amendment,
supplement or other modification to any Letter of Credit shall be subject to the
same conditions applicable under this Agreement to the issuance of new Letters
of Credit (including, without limitation, that the request therefor be made
through the Agent), and no such amendment, supplement or other modification
shall be issued unless either (i) the respective Letter of Credit affected
thereby would have complied with such conditions had it originally been issued
hereunder in such amended, supplemented or modified form or (ii) the Requisite
Lenders shall have consented thereto. In connection with any such amendment,
supplement or other modification, the Borrower shall pay the fees, if any,
payable under the last sentence of Section 3.6.(c).
(i) Lenders' Participation in Letters of Credit. Immediately upon the
issuance by the Agent of any Letter of Credit each Lender shall be deemed to
have absolutely, irrevocably and unconditionally purchased and received from the
Agent, without recourse or warranty, an undivided interest and participation to
the extent of such Lender's Revolving Commitment Percentage of the liability of
the Agent with respect to such Letter of Credit and each Lender thereby shall
absolutely, unconditionally and irrevocably assume, as primary obligor and not
as surety, and shall be unconditionally obligated to the Agent to pay and
discharge when due, such Lender's Revolving Commitment Percentage of the Agent's
liability under such Letter of Credit. In addition, upon the making of each
payment by a Lender to the Agent in respect of any Letter of Credit pursuant to
the immediately following subsection (j), such Lender shall, automatically and
without any further action on the part of the Agent or such Lender, acquire (i)
a participation in an amount equal to such payment in the Reimbursement
Obligation owing to the Agent by the Borrower in respect of such Letter of
Credit and (ii) a participation in a percentage equal to such Lender's Revolving
Commitment Percentage in any interest or other amounts payable by the Borrower
in respect of such Reimbursement Obligation (other than the fees payable to the
Agent pursuant to the last sentence of Section 3.6.(c)).
(j) Payment Obligation of Lenders. Each Lender severally agrees to pay
to the Agent on demand in immediately available funds in Dollars the amount of
such Lender's Revolving Commitment Percentage of each drawing paid by the Agent
under each Letter of Credit to the extent such amount is not reimbursed by the
Borrower pursuant to Section 2.2.(d). Each such Lender's obligation to make such
payments to the Agent under this subsection, and the Agent's right to receive
the same, shall be absolute, irrevocable and unconditional and shall not be
affected in any way by any circumstance whatsoever, including without
limitation, (i) the failure of any other Lender to make its payment under this
subsection, (ii) the financial condition of the Borrower or any other Loan
Party, (iii) the existence of any Default or Event of Default, including any
Event of Default described in Section 11.1.(e) or 11.1.(f) or (iv) the
termination of the Commitments. Each such payment to the Agent shall be made
without any offset, abatement, withholding or deduction whatsoever.
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(k) Information to Lenders. Promptly following any change in Letters of
Credit outstanding, the Agent shall deliver to each Lender and the Borrower a
notice describing the aggregate amount of all Letters of Credit outstanding at
such time. Upon the request of any Lender from time to time, the Agent shall
deliver any other information reasonably requested by such Lender with respect
to each Letter of Credit then outstanding. Other than as set forth in this
subsection, the Agent shall have no duty to notify the Lenders regarding the
issuance or other matters regarding Letters of Credit issued hereunder. The
failure of the Agent to perform its requirements under this subsection shall not
relieve any Lender from its obligations under Section 2.2.(j).
Section 2.3. Swingline Loans.
(a) Swingline Loans. Subject to the terms and conditions hereof, if
necessary to meet the various funding deadlines of the Borrower, the Swingline
Lender agrees to make Swingline Loans to the Borrower, during the period from
the Effective Date to but excluding the Swingline Termination Date, in an
aggregate principal amount at any one time outstanding up to, but not exceeding,
the amount of the Swingline Commitment. If at any time the aggregate principal
amount of the Swingline Loans outstanding at such time exceeds the Swingline
Commitment in effect at such time, the Borrower shall immediately pay the Agent
for the account of the Swingline Lender the amount of such excess. Subject to
the terms and conditions of this Agreement, the Borrower may borrow, repay and
reborrow Swingline Loans hereunder. The borrowing of a Swingline Loan shall not
constitute usage of any Lender's Revolving Commitment for purposes of
calculation of the fee payable under Section 3.6.(a) or otherwise.
(b) Procedure for Borrowing Swingline Loans. The Borrower shall give
the Agent and the Swingline Lender notice pursuant to a Notice of Swingline
Borrowing delivered to the Swingline Lender no later than 9:00 a.m. on the
proposed date of such borrowing. Any such telephonic notice shall include all
information to be specified in a written Notice of Swingline Borrowing. Not
later than 12:00 noon on the date of the requested Swingline Loan and subject to
satisfaction of the applicable conditions set forth in Article VII. for such
borrowing, the Swingline Lender will make the proceeds of such Swingline Loan
available to the Borrower in Dollars, in immediately available funds, at the
account specified by the Borrower in the Notice of Swingline Borrowing.
(c) Interest. Swingline Loans shall bear interest at a per annum rate
equal to the Base Rate as in effect from time to time or at such other rate or
rates as the Borrower and the Swingline Lender may agree from time to time in
writing. Interest payable on Swingline Loans is solely for the account of the
Swingline Lender. All accrued and unpaid interest on Swingline Loans shall be
payable on the dates and in the manner provided in Section 2.4. with respect to
interest on Base Rate Loans (except as the Swingline Lender and the Borrower may
otherwise agree in writing in connection with any particular Swingline Loan).
(d) Swingline Loan Amounts, Etc. Each Swingline Loan shall be in the
minimum amount of $500,000 and integral multiples of $100,000 in excess thereof,
or such other minimum amounts agreed to by the Swingline Lender and the
Borrower. Any voluntary prepayment of a Swingline Loan must be in integral
multiples of $100,000 or the aggregate principal amount of all
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outstanding Swingline Loans (or such other minimum amounts upon which the
Swingline Lender and the Borrower may agree) and in connection with any such
prepayment, the Borrower must give the Swingline Lender prior written notice
thereof no later than 10:00 a.m. on the day prior to the date of such
prepayment. The Swingline Loans shall, in addition to this Agreement, be
evidenced by the Swingline Notes.
(e) Repayment and Participations of Swingline Loans. The Borrower
agrees to repay each Swingline Loan borrowed by it within three Business Days of
demand therefor by the Swingline Lender and in any event, within 5 Business Days
after the date such Swingline Loan was made. Notwithstanding the foregoing, the
Borrower shall repay the entire outstanding principal amount of, and all accrued
but unpaid interest on, the Swingline Loans borrowed by it on the Swingline
Termination Date (or such earlier date as the Swingline Lender and the Borrower
may agree in writing). If the Borrower has not delivered a timely Notice of
Borrowing for Revolving Loans to be used to repay the entire outstanding
principal amount of, and all accrued but unpaid interest on, an outstanding
Swingline Loan, in lieu of demanding repayment of such Swingline Loan from the
Borrower, the Swingline Lender may, on behalf of the Borrower (which hereby
irrevocably directs the Swingline Lender to act on its behalf), request a
borrowing of Revolving Loans (which shall be Base Rate Loans) from the Lenders
in an amount equal to the principal balance of such Swingline Loan. The amount
limitations contained in Section 3.5.(a) shall not apply to any borrowing of
Base Rate Loans made pursuant to this subsection. The Swingline Lender shall
give notice to the Agent of any such borrowing of Base Rate Loans not later than
9:00 a.m. at least one Business Day prior to the proposed date of such
borrowing. Each Lender will make available to the Agent at the Principal Office
for the account of Swingline Lender, in immediately available funds, the
proceeds of the Base Rate Loan to be made by such Lender. The Agent shall pay
the proceeds of such Base Rate Loans to the Swingline Lender, which shall apply
such proceeds to repay such Swingline Loan. If the Lenders are prohibited from
making Loans required to be made under this subsection for any reason
whatsoever, including without limitation, the occurrence of any of the Defaults
or Events of Default described in Sections 11.1.(e) or 11.1.(f), each Lender
shall purchase from the Swingline Lender, without recourse or warranty, an
undivided interest and participation to the extent of such Lender's Revolving
Commitment Percentage of such Swingline Loan, by directly purchasing a
participation in such Swingline Loan in such amount and paying the proceeds
thereof to the Agent for the account of the Swingline Lender in Dollars and in
immediately available funds. A Lender's obligation to purchase such a
participation in a Swingline Loan shall be absolute and unconditional and shall
not be affected by any circumstance whatsoever, including without limitation,
(i) any claim of setoff, counterclaim, recoupment, defense or other right which
such Lender or any other Person may have or claim against the Agent, the
Swingline Lender or any other Person whatsoever, (ii) the occurrence or
continuation of a Default or Event of Default (including without limitation, any
of the Defaults or Events of Default described in Sections 11.1.(e) or 11.1.(f))
or the termination of the Commitments of any Lender, (iii) the existence (or
alleged existence) of an event or condition which has had or could have a
Materially Adverse Effect, (iv) any breach of any Loan Document by the Agent,
any Lender, the Borrower or any other Loan Party or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.
If such amount is not in fact made available to the Swingline Lender by any
Lender, the Swingline Lender shall be entitled to recover such amount on demand
from such Lender, together with accrued interest thereon for each day from the
date of demand thereof, at the Federal
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Funds Rate. If such Lender does not pay such amount forthwith upon the Swingline
Lender's demand therefor, and until such time as such Lender makes the required
payment, the Swingline Lender shall be deemed to continue to have outstanding
Swingline Loans in the amount of such unpaid participation obligation for all
purposes of the Loan Documents (other than those provisions requiring the other
Lenders to purchase a participation therein). Further, such Lender shall be
deemed to have assigned any and all payments made of principal and interest on
its Loans, and any other amounts due to it hereunder, to the Swingline Lender to
fund Swingline Loans in the amount of the participation in Swingline Loans that
such Lender failed to purchase pursuant to this Section until such amount has
been purchased (as a result of such assignment or otherwise).
Section 2.4. Rates and Payment of Interest on Loans.
(a) Rates. The Borrower promises to pay to the Agent for the account of
each Lender interest on the unpaid principal amount of each Loan made by such
Lender for the period from and including the date of the making of such Loan to
but excluding the date such Loan shall be paid in full, at the following per
annum rates:
(i) during such periods as such Loan is a Base Rate Loan, at
the Base Rate (as in effect from time to time); and
(ii) during such periods as such Loan is a LIBOR Loan, at
LIBOR for such Loan for the Interest Period therefor (from the first
day to, but excluding, the last day of such Interest Period), plus the
Applicable Margin for such Loan.
Notwithstanding the foregoing, during the continuance of an Event of Default,
the Borrower shall pay to the Agent for the account of each Lender interest at
the Post-Default Rate on the outstanding principal amount of any Loan made by
such Lender, on all Reimbursement Obligations and on any other amount payable by
the Borrower hereunder or under the Revolving Notes held by such Lender to or
for the account of such Lender (including without limitation, accrued but unpaid
interest to the extent permitted under Applicable Law).
(b) Payment of Interest. All accrued and unpaid interest on the
outstanding principal amount of each Loan shall be payable (i) monthly in
arrears on the first day of each month, commencing with the first full month
occurring after the Effective Date and (ii) on any date on which the principal
balance of such Loan is due and payable in full (whether at maturity, due to
acceleration or otherwise). Interest payable at the Post-Default Rate shall be
payable from time to time on demand. All determinations by the Agent of an
interest rate hereunder shall be conclusive and binding on the Lenders and the
Borrower for all purposes, absent manifest error.
Section 2.5. Number of Interest Periods.
There may be no more than (a) 6 different Interest Periods outstanding
at the same time with respect to Revolving Loans and (b) 4 different Interest
Periods outstanding at the same time with respect to Construction Advances owing
by the Borrower or a Subsidiary Borrower, as the case may be, with respect to a
given Construction Loan.
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Section 2.6. Repayment of Loans.
(a) Revolving Loans. Subject to Section 2.16., the Borrower shall repay
the entire outstanding principal amount of, and all accrued and unpaid interest
on, all Revolving Loans on the Revolving Credit Termination Date.
(b) Construction Advances. The Borrower (or Subsidiary Borrower, as the
case may be) shall repay the entire outstanding principal amount of, and all
accrued and unpaid interest on, the Construction Advances evidenced by
Construction Notes to which it is a party and advanced with respect to a
Construction Property on the Construction Loan Maturity Date for such
Construction Property.
(c) Payment of Principal of Term Loans. The Borrower shall repay the
aggregate principal balance of the Term Loans in eight equal consecutive
quarterly installments of principal. Each such installment shall be in an amount
equal to one-eighth of the initial aggregate principal balance of the Term
Loans. The first such installment shall be due on the date 90 days following the
date the Revolving Loans are converted into Term Loans pursuant to Section 2.16.
and each subsequent installment shall be due on the last day of each successive
90-day period following such conversion date until such Term Loans are paid in
full. Notwithstanding the foregoing, the entire outstanding principal balance of
each Term Loan shall be due and payable in full on the Termination Date.
Section 2.7. Late Charges.
If any payment required under this Agreement is not paid within 10 days
after it becomes due and payable, the Requisite Lenders may, by notice to the
Borrower, require that the Borrower pay a late charge for late payment to
compensate the Lenders for the loss of use of funds and for the expenses of
handling the delinquent payment, in an amount not to exceed four percent (4.0%)
of such delinquent payment. Such late charge shall be paid in any event not
later than the due date of the next subsequent installment of principal and/or
interest. In the event the maturity of the Obligations hereunder occurs or is
accelerated pursuant to Section 11.2., this Section shall apply only to payments
overdue prior to the time of such acceleration. This Section shall not be deemed
to be a waiver of the Lenders' right to accelerate payment of any of the
Obligations as permitted under the terms of this Agreement.
Section 2.8. Prepayments.
(a) Optional. Subject to Section 6.4., the Borrower may prepay any Loan
at any time without premium or penalty. The Borrower shall give the Agent at
least three (3) Business Days prior written notice of the prepayment of any
Loan.
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(b) Mandatory.
(i) Revolving Commitment Overadvance. If at any time the
aggregate principal amount of all outstanding Loans (excluding
Construction Advances), together with the aggregate amount of all
Letter of Credit Liabilities, exceeds the aggregate amount of the
Revolving Commitments, the Borrower shall immediately on demand pay to
the Agent for the account of the Lenders, the amount of such excess.
(ii) Borrowing Base Overadvance. If at any time the aggregate
principal amount of all outstanding Loans (excluding Construction
Advances), together with the aggregate amount of all Letter of Credit
Liabilities, exceeds the Borrowing Base, the Borrower shall, within 10
days of the Borrower's preparation of a Borrowing Base Certificate in
accordance with the provisions of this Agreement, which Borrowing Base
Certificate shows the occurrence of any such excess, deliver to the
Agent for prompt distribution to each Lender a written plan acceptable
to the Lenders to eliminate such excess. If such excess is not
eliminated within 90 days thereafter, then the entire outstanding
principal balance of all Loans, together with all accrued interest
thereon, and an amount equal to all Letter of Credit Liabilities for
deposit into the Letter of Credit Collateral Account, shall be
immediately due and payable in full.
(iii) Construction Commitment Overadvance. If at any time the
aggregate principal amount of all outstanding Construction Advances
exceeds aggregate amount of the Construction Commitments, the Borrower
shall immediately on demand pay to the Agent for the account of the
Lenders, the amount of such excess.
(iv) Construction Limit Overadvance. If at any time the
aggregate principal amount of all outstanding Construction Advances
advanced with respect to a Construction Property exceeds the
Construction Facility Limit for such Construction Property, the
Borrower shall immediately on demand pay to the Agent for the account
of the Lenders, the amount of such excess.
All payments under this subsection (b) shall be applied to pay all amounts of
excess principal outstanding on the applicable Loans and any applicable
Reimbursement Obligations in accordance with Section 3.2., and in the case of
clauses (i) and (ii) the remainder, if any, shall be deposited into the Letter
of Credit Collateral Account for application to any Reimbursement Obligations as
and when due.
Section 2.9. Continuation.
So long as no Event of Default shall have occurred and be continuing,
the Borrower may on any Business Day, with respect to any LIBOR Loan, elect to
maintain such LIBOR Loan or any portion thereof as a LIBOR Loan by selecting a
new Interest Period for such LIBOR Loan. Each new Interest Period selected under
this Section shall commence on the last day of the immediately preceding
Interest Period. Each selection of a new Interest Period shall be made by the
Borrower giving to the Agent a Notice of Continuation not later than 9:00 a.m.
on the third Business Day prior to the date of any such Continuation. Such
notice by the Borrower of a Continuation shall be by
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telephone or telecopy, confirmed immediately in writing if by telephone, in the
form of a Notice of Continuation, specifying (a) the proposed date of such
Continuation, (b) the LIBOR Loan and portion thereof subject to such
Continuation and (c) the duration of the selected Interest Period, all of which
shall be specified in such manner as is necessary to comply with all limitations
on Loans outstanding hereunder. Each Notice of Continuation shall be irrevocable
by and binding on the Borrower once given. Promptly after receipt of a Notice of
Continuation, the Agent shall notify each Lender by telex or telecopy, or other
similar form of transmission of the proposed Continuation. If the Borrower shall
fail to select in a timely manner a new Interest Period for any LIBOR Loan in
accordance with this Section, such Loan will automatically, on the last day of
the current Interest Period therefor, Continue as a LIBOR Loan having an
Interest Period of one month notwithstanding the Borrower not complying with
this Section.
Section 2.10. Conversion.
So long as no Event of Default shall have occurred and be continuing,
the Borrower may on any Business Day, upon the Borrower's giving of a Notice of
Conversion to the Agent, Convert all or a portion of a Loan of one Type into a
Loan of another Type. Any Conversion of a LIBOR Loan into a Base Rate Loan shall
be made on, and only on, the last day of an Interest Period for such LIBOR Loan
and, upon Conversion of a Base Rate Loan into a LIBOR Loan, the Borrower shall
pay accrued interest to the date of Conversion on the principal amount so
Converted. Each such Notice of Conversion shall be given not later than 9:00
a.m. one Business Day prior to the date of any proposed Conversion into Base
Rate Loans and three Business Days prior to the date of any proposed Conversion
into LIBOR Loans. Promptly after receipt of a Notice of Conversion, the Agent
shall notify each Lender by telex or telecopy, or other similar form of
transmission of the proposed Conversion. Subject to the restrictions specified
above, each Notice of Conversion shall be by telephone (confirmed immediately in
writing) or telecopy in the form of a Notice of Conversion specifying (a) the
requested date of such Conversion, (b) the Type of Loan to be Converted, (c) the
portion of such Type of Loan to be Converted, (d) the Type of Loan such Loan is
to be Converted into and (e) if such Conversion is into a LIBOR Loan, the
requested duration of the Interest Period of such Loan. Each Notice of
Conversion shall be irrevocable by and binding on the Borrower once given.
Section 2.11. Notes.
(a) Revolving Notes. The Revolving Loans and the Term Loan, if any,
made by each Lender shall, in addition to this Agreement, also be evidenced by a
promissory note of the Borrower substantially in the form of Exhibit A (each a
"Revolving Note"), payable to the order of such Lender in a principal amount
equal to the amount of its Revolving Commitment as originally in effect and
otherwise duly completed.
(b) Construction Notes. The Construction Advances made by each Lender
with respect to a Construction Property shall, in addition to this Agreement,
also be evidenced by a promissory note of the Borrower or Subsidiary Borrower,
as applicable, substantially in the form of Exhibit B (each a "Construction
Note"), payable to the order of such Lender in a principal amount equal to such
Lender's Construction Commitment Percentage of the Construction Loan Limit for
such Construction Property and otherwise duly completed.
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Section 2.12. Voluntary Reductions of the Revolving Commitment and
Construction Commitment.
The Borrower shall have the right to terminate or reduce the aggregate
unused amount of the Revolving Commitments (for which purpose use of the
Revolving Commitments shall be deemed to include the aggregate principal amount
of all outstanding Swingline Loans and the aggregate amount of Letter of Credit
Liabilities) and the aggregate unused amount of the Construction Commitments at
any time and from time to time without penalty or premium upon not less than 3
Business Days prior written notice to the Agent of each such termination or
reduction, which notice shall specify the effective date thereof and the amount
of any such reduction and shall be irrevocable once given and effective only
upon receipt by the Agent; provided, however, that if the Borrower seeks to
reduce the aggregate amount of the Revolving Commitments below $75,000,000,
then, unless the Agent and all Lenders have otherwise previously agreed in
writing, the Revolving Commitments shall be reduced to zero. The Agent will
promptly transmit a copy of any such notice of termination or reduction to each
Lender. The Revolving Commitments, once terminated or reduced may not be
increased or reinstated. Any reduction in the aggregate amount of the Revolving
Commitments shall result in a proportionate reduction (rounded to the next
lowest integral multiple of $500,000) in both the L/C Commitment Amount and the
Swingline Commitment.
Section 2.13. Expiration or Maturity Date of Letters of Credit Past Revolving
Credit Termination Date.
If on the date the Revolving Commitments are terminated (whether
voluntarily, by reason of the occurrence of an Event of Default or otherwise),
there are any Letters of Credit outstanding hereunder, the Borrower shall, on
such date, pay to the Agent an amount of money equal to the Stated Amount of
such Letter(s) of Credit for deposit into the Letter of Credit Collateral
Account. If a drawing pursuant to any such Letter of Credit occurs on or prior
to the expiration date of such Letter of Credit, the Borrower authorizes the
Agent to use the monies deposited in the Letter of Credit Collateral Account to
make payment to the beneficiary with respect to such drawing or the payee with
respect to such presentment. If no drawing occurs on or prior to the expiration
date of such Letter of Credit, the Agent shall pay to the Borrower (or to
whomever else may be legally entitled thereto) the monies deposited in the
Letter of Credit Collateral Account with respect to such outstanding Letter of
Credit on or before the date 10 days after the expiration date of such Letter of
Credit.
Section 2.14. Increase in Revolving Commitments.
At any time prior to the date two years after the Agreement Date but in
any event at least 90 days prior to the Construction Facility Termination Date,
the Borrower shall have the right, exercisable one time, to increase the
aggregate amount of the Revolving Commitments by an amount not to exceed the
lesser of (i) $25,000,000 or (ii) the amount by which the aggregate amount of
Construction Commitments exceeds the aggregate amount of the Construction Loans
(whether utilized or not). If the Borrower elects to exercise such right, it
shall give the Agent at least 15 but not more than 30 days prior written notice
of such exercise and the proposed effective date of such
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increase. Any such notice given by the Borrower shall be irrevocable. The Agent
shall forward a copy of any such notice to each Lender promptly upon receipt. So
long as (a) no Default or Event of Default shall have occurred and be continuing
both at the time of the Borrower's exercise of such right and immediately after
giving effect thereto; (b) the Borrower pays the fee due under Section 3.6.(g);
and (c) the Borrower executes and delivers new Revolving Notes to each Lender in
the amount of each Lender's new Commitment on or before the proposed effective
date of such increase, then the Revolving Commitments shall increase by the
aggregate amount requested on the proposed effective date of such increase. Any
increase in the aggregate amount of the Revolving Commitments under this Section
shall (x) be allocated among the Lenders in accordance with the provisions of
Section 3.2. and (y) result in simultaneous and corresponding decreases in the
respective Construction Commitments of each of the Lenders.
Section 2.15. Extension of Revolving Credit Termination Date.
(a) Generally. The Borrower shall have the right, exercisable one time,
to request that the Agent and the Lenders agree to extend the current Revolving
Credit Termination Date by one year. To exercise such right the Borrower shall
execute and deliver to the Agent at least 90 days but not more than 120 days
prior to the date one year before the Revolving Credit Termination Date, a
written request in the form of Exhibit C (an "Extension Request"). If the Agent
shall receive an Extension Request, the Agent shall forward a copy of it to each
Lender promptly upon receipt thereof. If all of the Lenders shall have notified
the Agent on or before the date 60 days prior to the date one year before the
current Revolving Credit Termination Date that they accept such Extension
Request, the Revolving Credit Termination Date shall be extended for a single
one-year period. If any Lender shall not have notified the Agent on or prior to
the date which is 60 days prior to the date one year before the current
Revolving Credit Termination Date that it accepts the Extension Request, the
Revolving Credit Termination Date shall not be extended except as otherwise
permitted under the immediately following subsection (b). The Agent shall
promptly notify the Borrower whether the Extension Request has been accepted or
rejected as well as which Lender or Lenders rejected the Borrower's Extension
Request (each such Lender, a "Rejecting Lender"). The Borrower understands and
acknowledges that (i) this Section has been included in this Agreement for the
Borrower's convenience in requesting an extension of the Revolving Credit
Termination Date; (ii) neither the Agent nor any Lender has promised (either
expressly or impliedly), nor does the Agent or any Lender have any obligation or
commitment whatsoever, to extend the Revolving Credit Termination Date and (iii)
the Agent and the Lenders may condition any such extension on such terms and
conditions as they may deem appropriate in their sole and absolute discretion.
(b) Rejecting Lenders. Notwithstanding the preceding subsection (a), if
the Borrower receives notification from the Agent that an Extension Request has
been rejected (a "Notice of Rejection"), and provided that the Lenders
comprising the Requisite Lenders have approved of such Extension Request, the
Borrower may elect, with respect to each such Rejecting Lender, by giving
written notice to the Agent of such election within 15 days after receipt by the
Borrower of a Notice of Rejection, to either (i) require such Rejecting Lender
to assign its Revolving Commitment to an Eligible Assignee as contemplated in
the immediately following clause (x) or (ii) pay in full the amount of Loans
(excluding Construction Advances), interest and fees owing to such Rejecting
Lender and terminate such Rejecting Lender's Revolving Commitment as
contemplated in the immediately following clause (y). If the Borrower has made a
timely election as permitted by the
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preceding sentence, then the Borrower shall take either of the following actions
as specified in such election: (x) demand that such Rejecting Lender, and upon
such demand such Rejecting Lender shall be obligated to, assign its Revolving
Commitment to an Eligible Assignee subject to and in accordance with the
provisions of Section 13.5.(c) for a purchase price equal to the aggregate
principal balance of Loans (excluding Construction Advances) then outstanding
and owing to such Rejecting Lender plus any accrued but unpaid interest thereon
and accrued but unpaid fees owing to such Rejecting Lender, any such assignment
to be effective as of the current Revolving Credit Termination Date or (y)
effective as of the current Revolving Credit Termination Date, pay to such
Rejecting Lender the aggregate principal balance of Loans (excluding
Construction Advances) then outstanding and owing to such Rejecting Lender plus
any accrued but unpaid interest thereon and accrued but unpaid fees owing to
such Rejecting Lender, together with all amounts, if any, payable under Section
6.4., whereupon such Rejecting Lender's Revolving Commitment shall terminate.
Neither the Agent, such Rejecting Lender, nor any other Lender shall be
obligated in any way whatsoever to initiate any such replacement or to assist in
finding an Assignee. If the Borrower has elected to cause all Rejecting Lenders
either to assign their Revolving Commitments to Eligible Assignees as
contemplated by the preceding clause (x) or to be paid the amounts specified in
the preceding clause (y), then the Borrower's Extension Request which was
initially rejected shall be deemed to have been granted and accordingly the
Revolving Credit Termination Date shall be extended by one single year,
otherwise the Revolving Credit Termination Date shall not be extended.
(c) No Extension In Certain Cases. Notwithstanding the preceding
subsections, if Requisite Lenders do not approve an Extension Request or if a
Default or Event of Default exists on the current Revolving Credit Termination
Date or would exist after giving effect to any of the transactions contemplated
by this Section, then the Revolving Credit Termination Date shall not be
extended.
Section 2.16. Term Loan Conversion.
Subject to the terms and conditions of this Agreement, if the Extension
Request shall be denied, the Borrower may then elect to convert each Lender's
Revolving Commitment Percentage of the aggregate principal amount of Revolving
Loans outstanding on the date one year prior to the current Revolving Credit
Termination Date into a term loan owing by the Borrower to each Lender (each a
"Term Loan") provided (a) the Borrower has given the Agent at least 15 days
prior notice of the Borrower's intention to so convert the Revolving Loans and
(b) the conditions set forth in Section 7.3. have been satisfied as of the date
one year prior to the current Revolving Credit Termination Date. Subject to the
terms and conditions hereof, any such conversion shall be effective as of the
date one year prior to the current Revolving Credit Termination Date. Upon the
effectiveness of the conversion of the outstanding principal balance of
Revolving Loans into Term Loans as contemplated by this Section, the Borrower
shall not have any right to borrow, and no Lender shall have any obligation to
make, any additional Revolving Loans.
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ARTICLE III. PAYMENTS, FEES AND OTHER GENERAL PROVISIONS
Section 3.1. Payments.
Except to the extent otherwise provided herein, all payments of
principal, interest and other amounts to be made by the Borrower under this
Agreement or any other Loan Document shall be made in Dollars, in immediately
available funds, without deduction, set-off or counterclaim, to the Agent, not
later than 11:00 a.m. on the date on which such payment shall become due (each
such payment made after such time on such due date to be deemed to have been
made on the next succeeding Business Day). The Borrower shall, at the time of
making each payment under this Agreement or any Note, specify to the Agent the
amounts payable by the Borrower hereunder to which Loan such payment is to be
applied. Each payment received by the Agent for the account of a Lender under
this Agreement or any Note of such Lender shall be paid to such Lender, by wire
transfer of immediately available funds in accordance with the wiring
instructions provided by such Lender to the Agent from time to time, for the
account of such Lender at the applicable Lending Office of such Lender. If the
Agent fails to pay such amounts to such Lender within one Business Day of
receipt by the Agent, the Agent shall pay interest on such amount until paid at
a rate per annum equal to the Federal Funds Rate from time to time in effect. If
the due date of any payment under this Agreement or any other Loan Document
would otherwise fall on a day which is not a Business Day such date shall be
extended to the next succeeding Business Day and interest shall be payable for
the period of such extension.
Section 3.2. Pro Rata Treatment.
Except to the extent otherwise provided in this Agreement: (a) each
borrowing from the Lenders under Section 2.1.(a) and Section 5.1.(a) shall be
made from the Lenders, each payment of the Fees under Section 3.6. shall be made
for the account of the Lenders, and each termination or reduction of the amount
of the Revolving Commitments under Section 2.12. and each increase in the
Revolving Commitments and decreases of the Construction Commitments of the
Lenders under Section 2.14. shall be applied to the respective Commitments of
the Lenders, pro rata according to the amounts of their respective Commitments;
(b) each payment or prepayment of principal of Revolving Loans and Construction
Advances by the Borrower shall be made for the account of the Lenders pro rata
in accordance with the respective unpaid principal amounts of such Revolving
Loans or Construction Advances, as the case may be, held by them, provided that
if immediately prior to giving effect to any such payment in respect of (i)
Revolving Loans, the outstanding principal amount of such Revolving Loans shall
not be held by the Lenders pro rata in accordance with their respective
Revolving Commitments in effect at the time such Loans were made, or (ii)
Construction Advances, the outstanding principal amount of such Construction
Advances shall not be held by the Lenders pro rata in accordance with their
respective Construction Commitments in effect at the time such Loans were made,
then such payment shall be applied to the such Loans in such manner as shall
result, as nearly as is practicable, in the outstanding principal amount of the
Revolving Loans or Construction Advances, as the case may be, being held by the
Lenders pro rata in accordance with their respective Revolving Commitments in
the case of Revolving Loans, or their respective Construction Commitments, in
the case of Construction Advances; (c) each payment or prepayment of principal
of Term Loans by the Borrower shall be made for account of the Lenders pro rata
in accordance with the respective unpaid principal amounts of the Term Loan
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then owing to each of them; (d) each payment of interest on Revolving Loans,
Term Loans and Construction Advances by the Borrower shall be made for the
account of the Lenders pro rata in accordance with the amounts of interest on
such Loans then due and payable to the respective Lenders; (e) the making,
Conversion and Continuation of Loans of a particular Type (other than
Conversions provided for by Section 6.5.) shall be made pro rata among the
Lenders according to the amounts of their respective Revolving Commitments or
Construction Commitments (in the case of making of Revolving Loans or
Construction Advances, as applicable) or their respective Loans (in the case of
Conversions and Continuations of Loans) and the then current Interest Period for
each Lender's portion of each Loan of such Type shall be coterminous; and (f)
the Lenders' participation in, and payment obligations in respect of, Letters of
Credit under Section 2.2. and Swingline Loans under Section 2.3., shall be pro
rata in accordance with their respective Revolving Commitments. All payments of
principal, interest, fees and other amounts in respect of the Swingline Loans
shall be for the account of the Swingline Lender only (except to the extent any
Lender shall have acquired a participating interest in any such Swingline Loan
pursuant to Section 2.3.(e)).
Section 3.3. Sharing of Payments, Etc.
If a Lender shall obtain payment of any principal of, or interest on,
any Loan made by it to the Borrower under this Agreement, or shall obtain
payment on any other Obligation owing by the Borrower or a Loan Party through
the exercise of any right of set-off, banker's lien or counterclaim or similar
right or otherwise or through voluntary prepayments directly to a Lender or
other payments made by the Borrower or other Loan Party to a Lender not in
accordance with the terms of this Agreement and such payment should be
distributed to the Lenders pro rata in accordance with Section 3.2. or Section
11.5., as applicable, such Lender shall promptly purchase from the other Lenders
participations in (or, if and to the extent specified by such Lender, direct
interests in) the Loans made by the other Lenders or other Obligations owed to
such other Lenders in such amounts, pay such amounts to the other Lenders and
make such other adjustments from time to time as shall be equitable, so that all
the Lenders shall share the benefit of such payment (net of any reasonable
expenses which may be incurred by such Lender in obtaining or preserving such
benefit) pro rata in accordance with Section 3.2. or Section 11.5. To such end,
all the Lenders shall make appropriate adjustments among themselves (by the
resale of participations sold or otherwise) if such payment is rescinded or must
otherwise be restored. The Borrower agrees that any Lender so purchasing a
participation (or direct interest) in the Loans or other Obligations owed to
such other Lenders may exercise all rights of set-off, banker's lien,
counterclaim or similar rights with respect to such participation as fully as if
such Lender were a direct holder of Loans in the amount of such participation.
Nothing contained herein shall require any Lender to exercise any such right or
shall affect the right of any Lender to exercise, and retain the benefits of
exercising, any such right with respect to any other indebtedness or obligation
of the Borrower.
Section 3.4. Several Obligations.
No Lender shall be responsible for the failure of any other Lender to
make a Loan or to perform any other obligation to be made or performed by such
other Lender hereunder, and the failure of any Lender to make a Loan or to
perform any other obligation to be made or performed by
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it hereunder shall not relieve the obligation of any other Lender to make any
Loan or to perform any other obligation to be made or performed by such other
Lender.
Section 3.5. Minimum Amounts.
(a) Borrowings. Each borrowing of Base Rate Loans shall be in an
aggregate minimum amount of $500,000 and integral multiples of $100,000 in
excess thereof. Each borrowing and Continuation of, and each Conversion of Base
Rate Loans into, LIBOR Loans shall be in an aggregate minimum amount of
$1,000,000 and integral multiples of $250,000 in excess of that amount.
Notwithstanding the foregoing, any such borrowing of Revolving Loans may be in
the aggregate amount of the unused Revolving Commitments. Construction Advances
and reimbursements of letters of credit pursuant to Section 2.2.(e) shall not be
subject to the limitations of this subsection (a).
(b) Prepayments. Each voluntary prepayment of Loans shall be in an
aggregate minimum amount of $500,000 and integral multiples of $100,000 in
excess thereof or, if all Loans are being prepaid at such time, the prepayment
may be in such other amount as is then outstanding.
(c) Reductions of Revolving Commitments. Each reduction of the
Revolving Commitments under Section 2.12. shall be in an aggregate minimum
amount of $10,000,000 and integral multiples of $5,000,000 in excess thereof.
Each reduction of the Construction Commitments under Section 2.12. shall be in
an aggregate minimum amount of $5,000,000 and integral multiples of $1,000,000
in excess thereof.
Section 3.6. Fees.
(a) Facility Fees. On the Effective Date, the Borrower agrees to pay to
the Agent for the account of each Lender such facility fees as agreed to by the
Borrower, the Agent and such Lender.
(b) Unused Fees
(i) Revolving Commitments. During the period from the
Effective Date to but excluding the Revolving Credit Termination Date,
the Borrower agrees to pay to the Agent for the account of the Lenders
an unused facility fee equal to the sum of the daily amount by which
the aggregate amount of the Revolving Commitments exceeds the aggregate
outstanding principal balance of Revolving Loans and Letter of Credit
Liabilities set forth in the table below multiplied by the
corresponding per annum rate applicable to that portion:
--------------------------------------------------------------------------------
Amount by Which Revolving Commitments Exceeds Revolving Loans
and Letter of Credit Liabilities Unused Fee
--------------------------------------------------------------------------------
$0 to and including an amount equal to 50% of the aggregate 0.125%
amount of Revolving Commitments
--------------------------------------------------------------------------------
Greater than an amount equal to 50% of the aggregate amount 0.250%
of Revolving Commitments
--------------------------------------------------------------------------------
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Such fees shall be computed on a daily basis and payable quarterly in
arrears on the first day of each January, April, July and October
during the term of this Agreement and on the Revolving Credit
Termination Date.
(ii) Construction Commitments. During the period from the
Effective Date to but excluding the Construction Facility Termination
Date, the Borrower agrees to pay to the Agent for the account of the
Lenders an unused facility fee equal to 0.125% of the sum of the daily
amount by which the aggregate amount of the Construction Commitments
exceeds the aggregate amount of the Construction Loans (whether
utilized or not). Such fees shall be computed on a daily basis and
payable quarterly in arrears on the first day of each January, April,
July and October during the term of this Agreement and on the
Construction Facility Termination Date.
(c) Letter of Credit Fees. The Borrower agrees to pay to the Agent for
the account of the Lenders a letter of credit fee at a rate per annum equal to
one and one-quarter percent (1.25%) of the Stated Amount of each Letter of
Credit. In addition, the Borrower shall pay to the Agent for its own account and
not the account of any Lender, a fronting fee in respect of each Letter of
Credit at a per annum rate equal to one-eighth of one percent (0.125%) of the
Stated Amount of such Letter of Credit. Both such fees shall be payable
quarterly in advance on the date such Letter of Credit is issued and each
quarterly anniversary of the date of such issuance. The Borrower shall pay
directly to the Agent from time to time on demand all routine commissions,
charges, costs and expenses in the amounts customarily charged by the Agent from
time to time in like circumstances with respect to the issuance of each Letter
of Credit, drawings, amendments and other transactions relating thereto.
(d) Extension/Term Loan Conversion Fee. If either (i) the Revolving
Credit Termination Date is extended pursuant to Section 2.15. or (ii) the
outstanding balance of Revolving Loans is converted into Term Loans pursuant to
Section 2.16., the Borrower agrees to pay to the Agent for the account of each
Lender (other than a Rejecting Lender in the case of an extension of the
Revolving Credit Termination Date) a fee equal to one-quarter of one percent
(0.25%) of, in the case of an extension pursuant to Section 2.15., the amount of
such Lender's Revolving Commitment at such time or, in the case of a conversion
pursuant to Section 2.16., the amount of Revolving Loans of such Lender
converted at such time. Such fee shall be paid by the Borrower on or prior to
(x) in the case of the extension of the Revolving Credit Termination Date, the
date on which such extension is effective and (y) in the case of the conversion
of the Revolving Loans into Term Loans, the date on which such conversion is
effective.
(e) Construction Loan Fee. The Borrower shall pay to the Agent for the
account of the Lenders a fee in the amount of 0.25% of the amount of the
Construction Loan with respect to a Construction Property. Such fee shall be
paid by the Borrower as required under Section 5.1.(c)(xxxx).
(f) Extension of Construction Loan Maturity Date. If the Construction
Loan Maturity Date with respect to a Construction Property is extended pursuant
to Section 5.4.(d), the Borrower
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agrees to pay to the Agent for the account of the Lenders a fee equal to
one-quarter of one percent (0.25%) of the Construction Loan Limit with respect
to such Construction Property. Such fee shall be paid by the Borrower no later
than the date on which such extension is effective.
(g) Revolving Commitment Increase Fee. In connection with an increase
in the aggregate amount of the Revolving Commitments pursuant to Section 2.14.,
the Borrower agrees to pay to the Agent for the account of each Lender a fee
equal to one-quarter of one percent (0.25%) of the amount of increase of such
Lender's Revolving Commitment. Such fee shall be paid no later than the
effective date of the increase in the Revolving Commitments.
(h) Agent's Fees. The Borrower agrees to pay the administrative and
other fees of the Agent as may be agreed to in writing from time to time.
Section 3.7. Computations.
Unless otherwise expressly set forth herein, any accrued interest on
any Loan, any Fees or other Obligations due hereunder shall be computed on the
basis of a year of 360 days and the actual number of days elapsed.
Section 3.8. Usury.
In no event shall the amount of interest due or payable on the Loans or
other Obligations exceed the maximum rate of interest allowed by Applicable Law
and, if any such payment is paid by the Borrower or received by any Lender or
the Swingline Lender, then such excess sum shall be credited as a payment of
principal, unless the Borrower shall notify the respective Lender or the
Swingline Lender in writing that the Borrower elects to have such excess sum
returned to it forthwith. It is the express intent of the parties hereto that
the Borrower not pay and neither the Lenders nor the Swingline Lender receive,
directly or indirectly, in any manner whatsoever, interest in excess of that
which may be lawfully paid by the Borrower under Applicable Law. The parties
hereto hereby agree and stipulate that the only charge imposed upon the Borrower
for the use of money in connection with this Agreement is and shall be the
interest described in Sections 2.4.(a)(i) and (ii) and in Section 2.3.(c).
Notwithstanding the foregoing, the parties hereto further agree and stipulate
that all agency fees, syndication fees, facility fees, letter of credit fees,
underwriting fees, default charges, late charges, funding or "breakage" charges,
increased cost charges, attorneys' fees and reimbursement for costs and expenses
paid by the Agent, any Lender or the Swingline Lender to third parties or for
damages incurred by the Agent, any Lender or the Swingline Lender, are charges
made to compensate the Agent, any such Lender or the Swingline Lender for
underwriting or administrative services and costs or losses performed or
incurred, and to be performed or incurred, by the Agent, the Lenders and the
Swingline Lender in connection with this Agreement. Unless otherwise expressly
provided herein, all fees and all charges, other than charges for the use of
money, shall be fully earned and nonrefundable when due.
Section 3.9. Statements of Account.
The Agent will account to the Borrower monthly with a statement of
Loans, accrued interest and Fees, charges and payments made pursuant to this
Agreement and the other Loan Documents,
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and such account rendered by the Agent shall be deemed conclusive upon the
Borrower absent manifest error. The Agent will account to the Borrower on
changes in Letters of Credit in accordance with Section 2.2.(k). The failure of
the Agent to deliver such a statement of accounts shall not relieve or discharge
the Borrower from any of its obligations hereunder.
Section 3.10. Defaulting Lenders.
(a) If for any reason any Lender (a "Defaulting Lender") shall fail or
refuse to perform any of its obligations under this Agreement or any other Loan
Document to which it is a party within the time period specified for performance
of such obligation or, if no time period is specified, if such failure or
refusal continues for a period of two Business Days after notice from the Agent,
then, in addition to the rights and remedies that may be available to the Agent
or the Borrower under this Agreement or Applicable Law, such Defaulting Lender's
right to participate in the administration of the Loans, this Agreement and the
other Loan Documents, including without limitation, any right to vote in respect
of, to consent to or to direct any action or inaction of the Agent or to be
taken into account in the calculation of the Requisite Lenders, shall be
suspended during the pendency of such failure or refusal. If a Lender is a
Defaulting Lender because it has failed to make timely payment to the Agent of
any amount required to be paid to the Agent hereunder (without giving effect to
any notice or cure periods), in addition to other rights and remedies which the
Agent or the Borrower may have under the immediately preceding provisions or
otherwise, the Agent shall be entitled (a) to collect interest from such
Defaulting Lender on such delinquent payment for the period from the date on
which the payment was due until the date on which the payment is made at the
Federal Funds Rate, (b) to withhold or setoff and to apply in satisfaction of
the defaulted payment and any related interest, any amounts otherwise payable to
such Defaulting Lender under this Agreement or any other Loan Document and (c)
to bring an action or suit against such Defaulting Lender in a court of
competent jurisdiction to recover the defaulted amount and any related interest.
Any amounts received by the Agent in respect of a Defaulting Lender's Loans
shall not be paid to such Defaulting Lender and shall be held uninvested by the
Agent until such Defaulting Lender cures its default.
(b) Purchase/Assignment of Defaulting Lender's Commitments. The
Borrower may (x) demand that a Defaulting Lender, and upon such demand the
Defaulting Lender shall promptly, assign its Commitments to an Eligible
Assignee, or (y) pay to the Defaulting Lender the amount of all Obligations
owing to the Defaulting Lender or such other amount as may be agreed to by the
Borrower and the Defaulting Lender, whereupon (A) the Defaulting Lender shall no
longer be a party hereto or have any rights or obligations hereunder or under
any of the other Loan Documents and (B) the amount of the Construction Loan for
each Construction Property shall automatically be reduced by such Defaulting
Lender's Commitment Percentage (determined immediately prior to giving effect to
this subsection) of such Construction Loan. Upon any such assignment, the
Defaulting Lender's interest in the Loans and its rights hereunder (but not its
liability in respect thereof or under the Loan Documents or this Agreement to
the extent the same relate to the period prior to the effective date of the
purchase) shall terminate on the date of assignment, and the Defaulting Lender
shall promptly execute all documents reasonably requested to surrender and
transfer such interest to the Assignee thereof, including an appropriate
Assignment and Acceptance Agreement and, notwithstanding Section 13.5.(d), shall
pay to the Agent an assignment fee in the amount of $6,000. It shall be the sole
responsibility of the Borrower to find an Eligible Assignee
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willing to acquire the Defaulting Lender's Commitments under this Section and at
no time shall the Agent or any Lender be obligated in any way whatsoever to
assist in finding an Eligible Assignee. The exercise by the Borrower of its
rights under this clause shall be at the Borrower's sole cost and expenses and
at no cost or expense to the Agent or any of the other Lenders (excluding the
Defaulting Lender). Nothing contained in this Section is intended to limit in
any way whatsoever the rights and remedies that the Borrower may have with
respect to the Defaulting Lender hereunder or otherwise.
Section 3.11. Taxes.
(a) Taxes Generally. Except as provided in subsection (c) of this
Section, all payments by the Borrower of principal of, and interest on, the
Loans and all other Obligations shall be made free and clear of and without
deduction for any present or future excise, stamp or other taxes, fees, duties,
levies, imposts, charges, deductions, withholdings or other charges of any
nature whatsoever imposed by any taxing authority, but excluding (i) franchise
taxes, (ii) any taxes (other than withholding taxes) that would not be imposed
but for a connection between the Agent or a Lender and the jurisdiction imposing
such taxes (other than a connection arising solely by virtue of the activities
of the Agent or such Lender pursuant to or in respect of this Agreement or any
other Loan Document), (iii) any taxes imposed on or measured by any Lender's
assets, income, receipts or branch profits and (iv) any taxes arising after the
Agreement Date solely as a result of or attributable to a Lender changing its
designated Lending Office after the date such Lender becomes a party hereto
(such non-excluded items being collectively called "Taxes"). If any withholding
or deduction from any payment to be made by the Borrower hereunder is required
in respect of any Taxes pursuant to any Applicable Law, then the Borrower will:
(i) pay directly to the relevant Governmental Authority the
full amount required to be so withheld or deducted;
(ii) promptly forward to the Agent an official receipt or
other documentation satisfactory to the Agent evidencing such payment
to such Governmental Authority; and
(iii) pay to the Agent for its account or the account of the
applicable Lender, as the case may be, such additional amount or
amounts as is necessary to ensure that the net amount actually received
by the Agent or such Lender will equal the full amount that the Agent
or such Lender would have received had no such withholding or deduction
been required.
(b) Tax Indemnification. If the Borrower fails to pay any Taxes when
due to the appropriate Governmental Authority or fails to remit to the Agent,
for its account or the account of the respective Lender, as the case may be, the
required receipts or other required documentary evidence, the Borrower shall
indemnify the Agent and the Lenders for any incremental Taxes, interest or
penalties that may become payable by the Agent or any Lender as a result of any
such failure. For purposes of this Section, a distribution hereunder by the
Agent or any Lender to or for the account of any Lender shall be deemed a
payment by the Borrower.
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(c) Tax Forms. Prior to the date that any Lender or Participant
organized under the laws of a jurisdiction outside the United States of America
becomes a party hereto, such Person shall deliver to the Borrower and the Agent
such certificates, documents or other evidence, as required by the Internal
Revenue Code or Treasury Regulations issued pursuant thereto (including Internal
Revenue Service Forms W-8ECI and W-8BEN, as applicable, or appropriate successor
forms), properly completed, currently effective and duly executed by such Lender
or participant establishing that payments to it hereunder and under the Notes
are (i) not subject to United States Federal backup withholding tax and (ii) not
subject to United States Federal withholding tax under the Code. Each Lender
shall (x) deliver further copies of such forms or other appropriate
certifications on or before the date that any such forms expire or become
obsolete and after the occurrence of any event requiring a change in the most
recent form delivered to the Borrower and (y) obtain such extensions of the time
for filing, and renew such forms and certifications thereof as may be reasonably
requested by the Borrower or the Agent. The Borrower shall not be required to
pay any amount pursuant to last sentence of subsection (a) above to any Lender
or Participant that is organized under the laws of a jurisdiction outside of the
United States of America or the Agent, if it is organized under the laws of a
jurisdiction outside of the United States of America, if such Lender,
Participant or the Agent, as applicable, fails to comply with the requirements
of this subsection nor shall the Borrower be precluded from deducting any
applicable withholding taxes in such case.
ARTICLE IV. BORROWING BASE PROPERTIES
Section 4.1. Borrowing Base Properties.
(a) Initial Borrowing Base Properties. Subject to compliance with the
terms and conditions of Section 7.1. and subject to any limitations set forth on
Schedule 4.1., as of the Effective Date the Lenders have accepted the Properties
identified on Schedule 4.1. as Borrowing Base Properties. Such Schedule sets
forth the identity of each such Property, the legal owner thereof and whether
such owner is the Borrower, a Wholly Owned Subsidiary or a Subsidiary that is
not a Wholly Owned Subsidiary.
(b) Additional Borrowing Base Properties. If after the Agreement Date
the Borrower desires that the Lenders include an additional Property in
calculations of the Borrowing Base, the Borrower shall so notify the Agent in
writing. No Property will be evaluated by the Lenders unless and until the
Borrower delivers to the Agent the following, in form and substance satisfactory
to the Agent:
(i) An executive summary of the Property including, at a minimum,
the following information relating to such Property: (a) a description
of such Property, such description to include the age, location, site
plan, current occupancy rate and physical condition of such Property;
(b) the purchase price paid or to be paid for such Property if such
Property was acquired within 12 months of the submission of such
Property hereunder; (c) the current and projected condition of the
regional market and specific submarket in which such Property is
located, (d) the current projected capital plans and, if applicable,
current renovation plans for such Property, and (e) other demographic
and trade information relating to such Property as may be reasonably
requested by the Agent;
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(ii) Evidence that such Property has been operating for at least
ninety (90) days, including an operating statement for such Property
audited or certified by a representative of the Borrower as being true
and correct in all material respects and prepared in accordance with
GAAP for the previous two fiscal years and for the current fiscal year
through the fiscal quarter most recently ending, provided that, with
respect to any period such Property was not owned by the Borrower, a
Subsidiary or an Approved Joint Venture, such information shall only be
required to be delivered to the extent reasonably available to the
Borrower and such certification may be based upon the best of the
Borrower's knowledge, and provided further, that if such Property has
been operating for less than two fiscal years, the Borrower shall
provide such projections and other information concerning the
anticipated operation of such Property as the Agent may reasonably
request;
(iii) A current rent roll, including a lease maturity schedule, for
such Property, together with a three-year occupancy history of such
Property, in each case certified by a representative of the Borrower to
be true and correct, provided that, with respect to any period such
Property was not owned by the Borrower, a Subsidiary or an Approved
Joint Venture, all such information shall only be required to be
delivered to the extent reasonably available to the Borrower and such
certification may be based upon the best of the Borrower's knowledge;
(iv) Copies of all Leases with respect to such Property and a
summary of all Leases with respect to such Property, provided that if
such Property is a multi-family residential property, only the form
residential lease shall be submitted;
(v) Copies of any environmental assessments reports relating to
such Property available to the Borrower; and
(vi) Such other information the Agent or Lenders may reasonably
request in order to evaluate the Property.
If, after receipt and review of the foregoing documents and information, the
Agent is prepared to recommend acceptance of such Property as a Borrowing Base
Property, the Agent will so notify the Borrower and each Lender within 10
Business Days after receipt and review of all of such documents and information.
Within 5 Business Days of the Agent's giving such notice to the Lenders, the
Agent will send the foregoing documents and information to each of the Lenders.
(c) Appraisals and Other Third-Party Reports; Final Approval. Promptly
upon giving notice to the Lenders under the immediately preceding subsection (b)
that the Agent is prepared to recommend acceptance of such Property as a
Borrowing Base Property, the Agent shall commission, at the Agent's discretion
and the Borrower's expense, the following, to be in form and substance
satisfactory to the Agent:
(i) An Appraisal of such Property;
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(ii) A "Phase I" environmental assessment of such Property, which
report is to (1) be prepared by an environmental engineering firm
acceptable to the Agent and (2) comply with the requirements contained
in the Agent's guidelines adopted from time to time by the Agent to be
used in its lending practice generally; provided that the Agent, in the
Agent's discretion, may accept an existing "Phase I" environmental
assessment of such Property if the same is in form and substance
acceptable to the Agent and the Agent receives reliance letters in form
and substance acceptable to the Agent. In addition, if any such
environmental assessment contains a recommendation that a "Phase II"
environmental assessment be prepared, the Agent shall promptly
commission such an assessment; provided that the Agent, in the Agent's
discretion, may accept an existing "Phase II" environmental assessment
of such Property if the same is in form and substance acceptable to the
Agent and the Agent receives reliance letters in form and substance
acceptable to the Agent; and
(iii) If the Agent deems it necessary, a current engineering report
for such Property prepared by an engineering firm acceptable to the
Agent.
The Agent shall review each of the foregoing items within 10 Business Days of
receipt and so long as after any such review, the Agent remains prepared to
recommend acceptance of such Property as a Borrowing Base Property, the Agent
shall forward each such item to the Lenders. Upon receipt of any such Appraisal,
the Agent shall determine the Appraised Value of such Property and include such
Appraised Value with the Appraisal when forwarded to the Lenders. If after
review of any of the foregoing items, the Agent is unwilling to recommend
acceptance of such Property as a Borrowing Base Property, the Agent shall
promptly notify the Borrower and the Lenders and the consideration by the Agent
and the Lenders of such Property shall cease. Within 10 Business Days of the
date on which a Lender has received all of the items referred to in this
subsection and the immediately preceding subsection (b), such Lender shall
notify the Agent in writing whether or not such Lender accepts such Property as
a Borrowing Base Property. If a Lender fails to give such notice within such
time period, such Lender shall be deemed to have accepted such Property as a
Borrowing Base Property.
(d) Conditions Precedent to a Property's Inclusion in the Borrowing
Base. If the Requisite Lenders (which must include the Lender then acting as
Agent) have accepted a Property as a Borrowing Base Property, such Property
shall become a Borrowing Base Property, upon execution, if applicable, and/or
delivery to the Agent of all of the following instruments, documents and
agreements in respect of such Property, each to be in form and substance
satisfactory to the Agent, and such other items or documents as may be
appropriate under the circumstances and satisfaction of all other closing
requirements reasonably imposed by the Agent:
(i) An ALTA 1992 Form mortgagee's Policy of Title Insurance
(without any creditor's rights exclusion and without any mandatory
arbitration provision) or other form acceptable to the Agent, in favor
of the Agent for the benefit of the Lenders with respect to such
Property, including endorsements with respect to such items of coverage
as the Agent may request and which endorsements are available, issued
by a title insurance company acceptable to the Agent and with
coinsurance or reinsurance (with direct access agreements) with title
insurance companies acceptable to the Agent, showing the fee simple
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title to the land and improvements described in the applicable Security
Deed as vested in the Borrower, a Subsidiary or an Approved Joint
Venture, and insuring that the Lien granted by such Security Deed is a
valid first priority Lien against said property, subject only to such
restrictions, encumbrances, easements and reservations as are
acceptable to the Agent. The amount of coverage under such policy must
equal (x) 70% of the Appraised Value (based on the "stabilized value")
of such Property (excluding the value of any personal property located
at such Property) if such Property is not located in a Tie-In
Jurisdiction or (y) the Borrowing Base Value of such Property at such
time if such Property is located in a Tie-In Jurisdiction;
(ii) If such Property is located in a Tie-In Jurisdiction,
endorsements to all other existing title insurance policies issued to
the Agent with respect to all other Properties located in Tie-In
Jurisdictions reflecting an increase in the aggregate insured amount
under the "tie-in" endorsements to an amount equal to the aggregate
amount of the Borrowing Base Values of all such Properties (including
the Property to be included as a Borrowing Base Property) but in no
event in an amount in excess of the aggregate amount of the Revolving
Commitments;
(iii) UCC, tax, judgment and lien search reports with respect to
the Borrower (or Subsidiary or Approved Joint Venture if the Property
is owned by a Subsidiary or Approved Joint Venture) and such Property
in all necessary or appropriate jurisdictions indicating that there are
no Liens of record on such Property or any of the Collateral relating
thereto other than Permitted Liens or any Liens to be terminated prior
to such Property becoming a Borrowing Base Property;
(iv) Final certificates of occupancy and any other Governmental
Approvals relating to such Property or, if not reasonably available,
reasonably equivalent evidence thereof;
(v) Plans and specifications for such Property, provided the same
shall only be required to the extent reasonably available to the
Borrower;
(vi) A current or currently certified survey of such Property
certified to the Agent and the Lenders by a surveyor licensed in the
applicable jurisdiction to have been prepared in accordance with the
then effective Minimum Standard Detail Requirements for ALTA/ACSM Land
Title Surveys and otherwise in form and substance satisfactory to the
Agent;
(vii) If not adequately covered by the survey certification
provided for above, a certificate from a licensed engineer or other
professional satisfactory to the Agent indicating whether such Property
is located in a Special Flood Hazard Area as defined by the Federal
Insurance Administration;
(viii) Copies of (A) all Property Management Agreements and all
other material contracts, if any, which will relate to the use,
occupancy, operation, maintenance, enjoyment or ownership of such
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Property at the time it becomes a Borrowing Base Property, and (B) if
such Property is not yet owned by the Borrower, a Subsidiary or an
Approved Joint Venture, the purchase agreement pursuant to which the
Borrower, such Subsidiary or such Approved Joint Venture is to acquire
such Property;
(ix) Evidence that such Property complies with applicable zoning
and land use laws and evidence that all real property and personal
property ad valorem taxes with respect to such Property have been paid,
together with copies of the most recent tax bills;
(x) A Security Deed encumbering such Property in favor of the Agent
for the benefit of the Lenders, the form of such Security Deed to be
modified as appropriate to conform to the Applicable Laws of the
jurisdiction in which such Property is located, together with financing
statements relating to the security interest granted thereunder;
(xi) An Assignment of Leases and Rents, the form of such Assignment
of Leases and Rents to be modified as appropriate to conform to the
Applicable Laws of the jurisdiction in which such Property is located,
together with assignments or other appropriate security interests in
form and substance satisfactory to the Agent covering each letter of
credit, guaranty and other credit enhancement for each Lease;
(xii) An Environmental Indemnity Agreement;
(xiii) A Property Management Contract Assignment (or an agreement
regarding termination thereof, at the Agent's election) covering the
Property Management Agreement, if any, for such Property;
(xiv) If requested by the Agent, collateral assignments of the
other material contracts relating to the use, occupancy, operation,
maintenance, enjoyment or ownership of such Property;
(xv) If such Property is a retail or industrial property, estoppel
certificates and subordination, non-disturbance and attornment
agreements, substantially in the form of Exhibit W, with such changes
as may be approved by the Agent, from each Major Tenant and Anchor
Tenant leasing any of such Property and from other tenants of such
Property representing, in the aggregate, together with such Major
Tenants and Anchor Tenants, at least 70.0% of the net rentable square
footage of such Property;
(xvi) An opinion of counsel admitted to practice law in the
jurisdiction in which such Property is located and acceptable to the
Agent, addressed to the Agent and each Lender covering such legal
matters relating to the transactions contemplated hereby as the Agent
may reasonably request;
(xvii) A Borrowing Base Certificate calculated giving effect to the
inclusion of such Property as a Borrowing Base Property;
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(xviii) If such Property is not owned by the Borrower, each of the
items required to be delivered to the Agent under Section 9.15. (if not
previously delivered to the Agent); and
(xix) Such other instruments, documents, agreements, financing
statements, certificates, opinions and other Security Documents as the
Agent may reasonably request.
(e) Inclusion of An Existing Construction Property in the Borrowing
Base. If after the Agreement Date the Borrower desires that the Lenders include
in the calculations of the Borrowing Base a Property that is an existing
Construction Property, the Borrower may do so in accordance with this subsection
(e). The Borrower shall notify the Agent in writing of its desire to submit such
Construction Property as a Borrowing Base Property, and shall include evidence
satisfactory to the Agent that such Construction Property has an Occupancy Rate
of at least 85.0% (determined in accordance with the last sentence of clause (d)
of the definition of Borrowing Base Property); provided that if the Occupancy
Rate is less than 85%, such Construction Property may still become a Borrowing
Base Property pursuant to this subsection (e) with the approvals of the
Requisite Lenders (which must include the Lender then acting as Agent). The
Agent shall promptly commission at the Borrower's expense, if the Agent deems it
appropriate, an updated Appraisal of such Construction Property, to be in form
and substance satisfactory to the Agent. The Agent shall review such Appraisal
within 10 Business Days of receipt and shall promptly thereafter (a) notify each
Lender of the Borrower's request, (b) forward such Appraisal and the Agent's
determination of the Appraised Value of such Construction Property to the
Lenders and (c) provide the Lenders an estimated date on which such Construction
Property will be accepted as a Borrowing Base Property.
Upon execution, if applicable, and/or delivery to the Agent of all of
the instruments, documents and agreements in respect of such Construction
Property described in clauses (i), (ii), (iv), (vi), (viii), (xv), (xvi),
(xvii), (xviii) and (xix) of subsection (d) above as well as an amendment and
restatement of the existing Security Deed, the existing Assignment of Leases and
Rents, the existing Environmental Indemnity Agreement and the existing Property
Management Contract Assignment with respect to such Construction Property, each
to be in form and substance satisfactory to the Agent, and such other items or
documents as may be appropriate under the circumstances, and satisfaction of all
other closing requirements reasonably imposed by the Agent such Construction
Property shall cease to be a Construction Property and shall become a Borrowing
Base Property. Within 10 Business Days of the conversion of such Construction
Property to a Borrowing Base Property, the Lenders shall cancel each their
Construction Notes with respect to such Construction Property and return them to
the Agent who shall forward them to the Borrower.
(f) Determination of Appraised Value. The initial Appraised Value of a
Property shall be determined as provided in subsection (c) above and the
definition of Appraised Value; provided, however, that upon 5 Business Days
prior notice to the Borrower and at the Borrower's sole cost and expense, the
Agent will redetermine the Appraised Value of any Property (based upon a new
Appraisal obtained by the Agent) if necessary in order to comply with FIRREA or
other Applicable Law relating to the Agent or the Lenders generally or as
provided in Section 4.2.(b)(ii).
(g) Release of a Property. From time to time the Borrower may request,
upon not less than 30 days prior written notice to the Agent (a copy of which
notice the Agent shall promptly provide to the Lenders), that a Property
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included in determinations of the Borrowing Base cease to be so included and be
released, together with any related Collateral, from the Liens of the applicable
Security Documents. The Agent shall grant such request if all of the following
conditions are satisfied:
(i) no Default or Event of Default shall have occurred and be
continuing both at the time of such request and immediately after
giving effect to such request;
(ii) the Borrower shall have delivered to the Agent a Borrowing
Base Certificate demonstrating on a pro forma basis, and the Agent
shall have determined to its satisfaction, that the outstanding
principal balance of the Loans (exclusive of Construction Advances),
together with the Letter of Credit Liabilities, will not exceed the
Borrowing Base after giving effect to such request and any prepayment
to be made and/or the acceptance of any Property as an additional or
replacement Borrowing Base Property to be given concurrently with such
request; and
(iii) the Agent shall have determined that the market values of the
remaining Borrowing Base Properties have not materially deteriorated
since the respective dates of acceptance as Borrowing Base Properties.
After giving effect to any request that a Property cease to be included in
determinations of the Borrowing Base, the Borrower may request in writing that
the Agent release, and upon receipt of such request the Agent shall release, (a)
its Lien on such Property and all other Collateral relating to such Property and
(b) if such Property is owned by a Subsidiary that is not a Wholly Owned
Subsidiary or an Approved Joint Venture, such Subsidiary or Approved Joint
Venture from the Guaranty so long as (i) such Subsidiary or Approved Joint
Venture is not otherwise required to be a Guarantor under Section 9.15. and (ii)
no Default or Event of Default shall then be in existence or would occur as a
result of such release.
(h) Release of a Pad Site from a Borrowing Base Property. From time to
time the Borrower may request, upon not less than 30 days prior written notice
to the Agent (a copy of which notice the Agent shall promptly provide to the
Lenders), that a pad site within a Property included in determinations of the
Borrowing Base be released from the Liens of the applicable Security Documents.
For purposes of this release provision, the phrase "pad site" refers to the
portion of such Property to be released, which portion may be unimproved,
partially improved or fully improved. The Agent shall promptly commission at the
Borrower's expense, if the Agent deems it necessary, an Appraisal of such
Property, exclusive of the pad site, to be in form and substance satisfactory to
the Agent. The Agent shall review such Appraisal within 10 Business Days of
receipt and so long as after any such review, the Agent is prepared to recommend
such release, the Agent shall promptly notify each Lender of the Borrower's
request, forward such Appraisal and its determination of the Appraised Value of
such Property (exclusive of the pad site) to the Lenders. Promptly thereafter,
the Agent shall grant such request and release its Lien on such pad site (but
not on the balance of said Property and the Mortgaged Property associated
therewith) if all of the following conditions are satisfied:
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(i) no Default or Event of Default shall have occurred and be
continuing both at the time of such request and immediately after
giving effect to such request;
(ii) the Borrower shall have delivered to the Agent a Borrowing
Base Certificate demonstrating on a pro forma basis, and the Agent
shall have determined to its satisfaction, that the outstanding
principal balance of the Loans (exclusive of Construction Advances),
together with the Letter of Credit Liabilities, will not exceed the
Borrowing Base after giving effect to such request and any prepayment
to be made concurrently with such request;
(iii) the Borrower shall have delivered to the Agent evidence
satisfactory to the Agent as to form and content that the Property,
after such release, will be in conformity with all Applicable Laws,
including without limitation zoning, parking and subdivision
requirements; that the remaining Property has sufficient routes of
ingress and egress as deemed appropriate by the Agent, and in
connection therewith the Agent may require an endorsement to the Title
Policy covering said Property; and that the release or separate
ownership of said pad will not result or be likely to result in
violations of any restrictive covenants or Leases affecting said
Property;
(iv) the Borrower shall have delivered such other instruments,
documents, agreements or other items as the Agent may reasonably
request.
(i) Cross-Collateralization and Cross-Default of Loans (other than
Construction Loans) and Letter of Credit Liabilities. All Security Documents for
any given Borrowing Base Property will be cross-collateralized and
cross-defaulted with all Security Documents for all other Borrowing Base
Properties, and will be further cross-defaulted with all other Loan Documents,
all subject to and in accordance with the terms of the Loan Documents, including
Section 11.1.(k). The Security Documents for any particular Borrowing Base
Property shall secure the entire $175,000,000.00 potential maximum amount of
Loans and Letter of Credit Liabilities (other than Construction Loans), but the
Borrower may make proposals to the Agent regarding availability of any
allocation, apportionment or similar provisions under applicable state law in
order to minimize, reduce or eliminate applicable mortgage, documentary stamp,
intangible or similar taxes calculated on the amount of debt secured by the
applicable Security Instrument, and so long as no Event of Default shall then be
in existence, the Agent will use reasonable efforts to implement such proposal
if, in the Agent's reasonable judgment, the Lenders and the security of the
Borrowing Base Property will be protected as contemplated by this Agreement and
the other applicable Security Documents; provided, however, that the Agent shall
have no obligation to limit the amount secured by any such Security Document in
order to reduce such taxes if no allocation, apportionment or similar
arrangement is available.
Section 4.2. Frequency of Appraisals.
The Appraised Value of a Property included (or to be included) in
calculations of the Borrowing Base shall be determined or redetermined, as
applicable, under each of the following circumstances:
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(a) In connection with the acceptance of a Property as a Borrowing Base
Property the Agent will determine the Appraised Value thereof as provided in
Section 4.1.; or
(b) From time to time upon at least 5 Business Days written notice to
the Borrower and at the Borrower's expense, the Agent may (and shall at the
direction of the Requisite Lenders) redetermine the Appraised Value of a
Borrowing Base Property (based on a new Appraisal obtained by the Agent) in
either of the following circumstances:
(i) if a material adverse change occurs with respect to a Borrowing
Base Property, including, without limitation, a material deterioration
in the Net Operating Income of such Borrowing Base Property, a major
casualty at such Borrowing Base Property that is not fully covered by
insurance, a material condemnation of any part of such Borrowing Base
Property, a material adverse change in the market conditions affecting
such Borrowing Base Property or a material decrease in the leasing
level of such Borrowing Base Property; or
(ii) if necessary in order for the Agent or any Lender to comply
with FIRREA or other Applicable Law; or
(c) At any time and from time to time but no more than once during any
period of two years, the Agent may (and shall at the written direction of the
Requisite Lenders) redetermine the Appraised Value of a Borrowing Base Property
(based on a new Appraisal obtained by the Agent), all at the Borrower's expense;
or
(d) At any time and from time to time, the Agent may (and shall at the
written direction of the Requisite Lenders) redetermine the Appraised Value of a
Borrowing Base Property (based on a new Appraisal obtained by the Agent), all at
the Lenders' expense if such redetermination is consented to by the Requisite
Lenders (otherwise, such Appraisal shall be at the expense of the Lenders so
consenting); or
(e) At any time and from time to time, upon the written request of the
Borrower and at the Borrower's sole cost and expense, the Agent will redetermine
the Appraised Value of a Borrowing Base Property (based upon a new Appraisal
obtained by the Agent).
At any time an Appraisal is obtained pursuant to subsections (b), (c), (d) and
(e) above, the Borrower shall promptly deliver to the Agent a Borrowing Base
Certificate which reflects the new Appraised Value for each such Borrowing Base
Property determined with respect to any such Appraisal.
Section 4.3. Frequency of Calculations of Borrowing Base.
Initially, the Borrowing Base shall be the amount set forth as such in
the Borrowing Base Certificate delivered under Section 7.1. Thereafter, the
Borrowing Base shall be the amount set forth as such in the Borrowing Base
Certificate delivered from time to time under Section 9.1.(g), 4.1.(g), 4.1.(h)
or 4.2.; provided, however, any change in the Borrowing Base Value of a Property
attributable to a change in the Permanent Loan Estimate for such Property shall
only be effected with respect to Borrowing Base Certificates delivered following
the first and third fiscal quarters of each fiscal year of the Parent. Any
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change in the Borrowing Base resulting from a change in the Borrowing Base Value
of a Borrowing Base Property shall become effective as of the next determination
of the Borrowing Base as provided in this Section; provided that any increase in
the Borrowing Base shall not become effective unless and until (a) if such
increase is the result of an increase in (i) the Appraised Value (as approved by
the Requisite Lenders, which approval shall be deemed to have been made by a
Lender if such Lender has not rejected such Appraised Value within 10 Business
Days of the date on which such Lender received such Appraised Value) of such
Borrowing Base Property or (ii) the Permanent Loan Estimate for such Borrowing
Base Property, the applicable Borrowing Base Certificate substantiates such
increase and (b) the Borrower delivers to the Agent the following: (i) if the
Property is not located in a Tie-In Jurisdiction and such increase is the result
of an increase in the Appraised Value of such Property, an endorsement to the
title insurance policy in favor of the Agent with respect to such Property
increasing the coverage amount thereof as related to such Property to not less
than 70% of the Appraised Value (based on the "stabilized value" of such
Property and excluding the value of personal property) for such Borrowing Base
Property, (ii) if the Property is located in a Tie-In Jurisdiction, an
endorsement to the title insurance policy in favor of the Agent with respect to
such Property increasing the coverage amount thereof as related to such Property
to not less than the Borrowing Base Value of such Borrowing Base Property, as
well as endorsements to all other existing title insurance policies issued to
the Agent with respect to all other Properties located in Tie-In Jurisdictions
reflecting an increase in the aggregate insured amount under the "tie-in"
endorsements to an amount equal to the aggregate amount of the Borrowing Base
Values of all such Properties (including the Property which experienced the
increase in Borrowing Base Value) but in no event in an amount in excess of the
aggregate amount of the Revolving Commitments, and (iii) if for any reason the
amount of the Obligations secured by the Security Documents relating to such
Property have been limited (in an effort to minimize recording, documentary
stamp, intangibles or similar taxes) to an amount less than the full amount of
the Loans (other than Construction Loans) and Letter of Credit Liabilities, such
modifications of the applicable Security Documents, in recordable form if
applicable, effectuating an appropriate increase to the amount secured thereby
based on the increase in the new Appraised Value, together with payment of all
applicable additional recording, documentary stamp, intangibles or similar taxes
payable in connection therewith, and an endorsement to applicable title policy
reflecting recordation of such modifications and no adverse change in such
coverage.
ARTICLE V. CONSTRUCTION LOAN FACILITY
Section 5.1. Construction Loans; Submissions for Acceptance as a Construction
Property.
(a) Generally; Initial Requests for Construction Loans. Subject to the
terms and conditions hereof, (i) during the period from the Effective Date to
but excluding the Construction Facility Termination Date, each Lender severally
and not jointly agrees to allocate portions of its Construction Commitment to
establish Construction Loans and (ii) prior to the Construction Loan Maturity
Date of a Construction Loan for a Construction Property, each Lender severally
and not jointly agrees to make Construction Advances in an aggregate principal
amount at any one time outstanding up to, but not exceeding, such Lender's
Construction Commitment Percentage of the Construction Loan Limit for such
Construction Property. Construction Advances borrowed with respect to a
Construction Property and then repaid may not be reborrowed with respect to such
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Construction Property except as provided in Section 5.1.(g). A Construction Loan
will not be established with respect to a Property unless and until the
applicable conditions precedent contained in this Article V. and in Article VII.
have been satisfied. The Borrower shall request the establishment of
Construction Loans, and all proceeds of Construction Advances in respect of
Construction Loans shall be disbursed, as provided in this Article. If the
Borrower desires that the Lenders agree to establish a Construction Loan and
make Construction Advances thereunder with respect to a given Property, the
Borrower shall give the Agent written notice of the Borrower's intent to obtain
a Construction Loan with respect to such Property and shall deliver to the Agent
each of the following items, and no Property will be evaluated by the Lenders
unless and until the Borrower delivers to the Agent each of the following, in
form and substance satisfactory to the Agent:
(i) An executive summary of such Property including, at a minimum,
the following information relating to such Property: (A) a description
of such Property, such description to include the location, visibility,
access, and site plan configuration; (B) the purchase price paid (or to
be paid) for such Property; (C) information regarding the local
economic conditions, including without limitation, market demographics
and characteristics; (D) information regarding existing and projected
retail supply in the trade area and area sales; and (E) other
demographic, trade and economic information relating to such Property
or the market in which it is located as may be requested by the Agent;
(ii) If such Property is owned by a Subsidiary Borrower, such
information regarding the other Persons holding any Equity Interests or
other Investments in such Subsidiary Borrower as the Agent may request
including without limitation, copies of the organizational documents of
such Subsidiary Borrower;
(iii) Information regarding the financial condition, business
history and construction experience of the General Contractor with
respect to such Property, and such other information regarding such
General Contractor, as the Agent may request;
(iv) A copy of each General Contract, Architect's Contract, and any
other material Construction Contract with respect to such Property;
(v) Evidence that such Property is to be developed as an anchored
community shopping center or so-called "power center" having multiple
anchor tenants and sufficient on-site, at grade parking for such
Property;
(vi) Evidence that at least 70.0% of the projected rentable square
footage of such Property owned by the Borrower or Subsidiary Borrower
(exclusive of any pad site within such Property which has been
identified as a potential pad site for sale or future development, and
either said pad site is the subject of a binding executed sales
contract under which the proposed occupant of such pad site will
purchase such pad site or such development costs are not included in
the Cost Breakdown for said Property) is subject to Leases, such
evidence to include, without limitation, copies of all Leases of any
space of such Property; provided, however, that the Requisite Lenders
(which must include the Lender then acting as Agent) may permit a
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Property to be less than 70.0% pre-leased if non-contingent, specific
performance, binding sales contracts have been executed by the Borrower
or such Subsidiary Borrower and a third party approved by the Agent
with respect to a pad site on such Property, which pad site represents
a significant portion of the total Property gross leasable area;
(vii) A copy of each ground lease, if any, under which any portion
of such Property is leased to the Borrower or, if applicable, a
Subsidiary Borrower;
(viii) The Cost Breakdown for such Property;
(ix) Copies of any environmental assessments reports relating to
such Property available to the Borrower; and
(x) Such other information the Agent may request in order to
evaluate such Property.
Within 5 Business Days of receipt of all of the foregoing documents and
information, the Agent shall send the foregoing documents and information to
each of the Lenders for their review and consideration. Within 10 Business Days
of the date on which a Lender has received all of the items referred to in this
subsection, such Lender shall notify the Agent in writing whether or not such
Lender conditionally approves of the establishment of a Construction Loan with
respect to such Property subject only to such Lender's acceptance of the
Appraised Value and the documentation to be obtained in accordance with the
following subsection and, if such Lender provides notice that is not
conditionally approving the establishment of such Construction Loan, such Lender
shall also provide in writing its reason for doing so. If a Lender fails to give
such notice within such time period, such Lender shall be deemed to have
conditionally approved of the establishment of a Construction Loan with respect
to such Property. If the Requisite Lenders (which must include the Lender then
acting as Agent) have not conditionally approved such Property, the approval
process shall terminate.
(b) Appraisal; Environmental; Further Approval Process. Promptly upon
receiving the conditional approval (or deemed approval, as applicable) of the
Requisite Lenders (which must include the Lender then acting as Agent) in
accordance the immediately preceding subsection (a), the Agent shall commission,
at the Agent's discretion and the Borrower's expense, the following, to be in
form and substance satisfactory to the Agent: (i) an Appraisal of such Property;
and (ii) a "Phase I" environmental assessment of such Property prepared by an
environmental engineering firm acceptable to the Agent and complying with the
requirements contained in the Agent's guidelines adopted from time to time by
the Agent to be used in its lending practice generally; provided that the Agent,
in the Agent's discretion, may accept an existing "Phase I" environmental
assessment of such Property if the same is in form and substance acceptable to
the Agent and the Agent receives reliance letters in form and substance
acceptable to the Agent. In addition, if any such environmental assessment
contains a recommendation that a "Phase II" environmental assessment be
prepared, the Agent shall promptly commission such an assessment. The Agent
shall review each of the foregoing items within 10 Business Days of receipt and
shall forward each such item to the Lenders. Upon receipt of any such Appraisal,
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the Agent shall determine the Appraised Value, the Constant Carried Percentage
(which must equal or exceed 8.750%) and the Construction Loan Limit for such
Property and include such Appraised Value, Constant Carried Percentage and the
Construction Loan Limit with the Appraisal when forwarded to the Lenders. Within
10 Business Days of the date on which a Lender has received all of the items
referred to in this subsection, such Lender shall notify the Agent in writing
whether or not such Lender finally approves of the establishment of a
Construction Loan with respect to such Property. If a Lender fails to give such
notice within such time period, such Lender shall be deemed to have approved of
the establishment of a Construction Loan with respect to such Property.
Notwithstanding anything in this Agreement or any Loan Document to the contrary,
no Property shall become a Construction Property, and accordingly no
Construction Loan shall be established with respect to a Property, unless and
until the Requisite Lenders (which must include the Lender then acting as Agent)
have agreed to do so (or have been deemed to have agreed to do so, as provided
herein).
(c) Deliveries for Final Acceptance of a Property as a Construction
Property. Subject to obtaining the approvals of the Requisite Lenders (which
must include the Lender then acting as Agent) with respect to a Property as
provided in the immediately preceding subsections (a) and (b) above, such
Property shall become a Construction Property upon execution, if applicable,
and/or delivery to the Agent all of the following instruments, documents,
agreements and items in respect of such Property, each to be in form and
substance satisfactory to the Agent (and the Independent Inspecting Architect,
if Agent so elects), and such other items or documents as may be appropriate
under the circumstances and satisfaction of all other closing requirements
reasonably imposed by the Agent:
(i) The Title Insurance Policy;
(ii) If such Property is located in a Tie-In Jurisdiction,
endorsements to all other existing Title Insurance Policies issued to
the Agent with respect to all other Construction Properties located in
Tie-In Jurisdictions reflecting an increase in the aggregate insured
amount under the "tie-in" endorsements to an amount equal to the
aggregate amount of the Construction Loan Limits for all Construction
Properties (including the Property to be included as a Construction
Property) but in no event in an amount in excess of the aggregate
amount of the Construction Commitments;
(iii) UCC, tax, judgment and lien search reports with respect to
the Borrower (or the Subsidiary Borrower, if the Property is owned by a
Subsidiary Borrower, and the ground lessor(s) if such Property is to be
a Leasehold Construction Property) and such Property in all necessary
or appropriate jurisdictions indicating that there are no Liens of
record on such Property or any of the Collateral relating thereto other
than Permitted Liens or any Liens to be terminated prior to such
Property becoming a Construction Property;
(iv) A current or currently certified survey of such Property
certified to the Agent and the Lenders by a surveyor licensed in the
applicable jurisdiction to have been prepared in accordance with the
then effective Minimum Standard Detail Requirements for ALTA/ACSM
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Construction Property Title Surveys and otherwise in form and substance
satisfactory to the Agent;
(v) If not adequately covered by the survey certification provided
for above, a certificate from a licensed engineer or other professional
satisfactory to the Agent indicating whether such Property is located
in a Special Flood Hazard Area as defined by the Federal Insurance
Administration;
(vi) The Construction Schedule and two complete sets of the Plans
for the Improvements and sitework then scheduled, which Plans must be
in full compliance with all Legal Requirements and all applicable
Governmental Authorities and all restrictions, if any, affecting the
applicable Mortgaged Property. The Borrower acknowledges and agrees
that the Construction Schedule, the Plans and the Cost Breakdown and
all other such information are subject to the approval of the Agent,
the Independent Inspecting Architect and, if required under the
applicable Leases, Major Tenants, Anchor Tenants, and that the
Independent Inspecting Architect must certify to the Lender that there
are adequate undisbursed funds available from the Construction Loan and
from the Equity Deposit to complete the Improvements in accordance with
the Construction Schedule and the Plans;
(vii) All information necessary for the Agent to evaluate and
approve all information for the Disbursement Schedule substantially in
the form of Exhibit T, and after approval of such information, a final
Disbursement Schedule executed and delivered by Borrower (or the
Subsidiary Borrower, as applicable) for such Property;
(viii) If such Property is not owned in fee simple absolute by the
Borrower or a Subsidiary Borrower, as applicable, a copy of the
applicable ground lease and all amendments thereto;
(ix) If such Property is not owned in fee simple absolute by the
Borrower or a Subsidiary Borrower, the Lease underlying such Property
must contains terms and mortgagee protection provisions acceptable to
the Agent, including without limitation the following, unless any such
provisions are modified or waived by the Agent, (a) the right of the
tenant to mortgage and encumber its interest in the Property, (b) the
obligation of the landlord thereunder to give the Agent written notice
of any defaults on the part of the tenant thereunder, (c) the agreement
of the landlord that no modification or voluntary termination of the
Lease by any party thereto shall be permitted without the prior written
consent of the Agent, (d) that insurance obtained under the Lease shall
include standard mortgagee clauses for the benefit of the Agent and the
Lenders, (e) that in the event of condemnation or other taking or
conveyance in lieu thereof, the tenant has the right to a separate
award for the value of the leasehold, (f) that there be no provision
for termination of the Lease in the event of a less than total
condemnation or other taking or conveyance in lieu thereof, unless it
is no longer economically feasible to continue operations on the
remaining property as were conducted prior to the condemnation or other
taking or conveyance in lieu thereof, (g) that the Agent's prior
written consent is required for any adjustment of insurance proceeds
for a material casualty or condemnation awards relating to a material
condemnation, (h) that
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insurance proceeds and condemnation awards relating to a material
casualty or a material condemnation shall held and disbursed or applied
by the Agent as provided in the applicable Security Deed, or otherwise
in a manner and pursuant to requirements acceptable to the Agent, (i)
that there be no automatic terminations under the Lease except for
total condemnation or taking in lieu thereof, and that there be no
unilateral right of the landlord to terminate the Lease except in the
event of default (after expiration of applicable grace and cure
periods), or in the case of certain casualty situations acceptable to
the Agent or in the case of less than total condemnation or taking
where it is not economically feasible to utilize the remaining portion
of the Property, and (j) that tenant's interest is assignable under
reasonable terms and conditions acceptable to the Agent, without
material restrictions on subletting. In addition, no default or event
which, with the giving of notice or passage of time, or both, could
become a default, shall exist under the Lease, and a consent and
estoppel and an absolute subordination agreement, all in both form and
substance satisfactory to the Agent, shall be delivered from the
landlord and from any holder of a Lien on the fee interest underlying
such leasehold Property, which shall include an agreement from the
landlord that, upon election of the Agent, the landlord shall enter
into a new Lease, on the same terms for the remaining unexpired term of
the Lease, with the Agent or the Agent's designee (subject to
reasonable conditions and criteria acceptable to the Agent) in the
event of a termination of the original Lease by reason of a default by
the tenant, including, without limitation, a rejection of the Lease in
a bankruptcy proceeding;
(x) Construction Notes executed by the Borrower (or the applicable
Subsidiary Borrower, if the Borrower has no interest in the Property)
payable to each Lender and complying with the terms of Section
2.11.(b), aggregating the applicable Construction Loan Limit;
(xi) A Security Deed encumbering such Property in favor of the
Agent for the benefit of the Lenders, the form of such Security Deed to
be modified as appropriate to conform to the Applicable Laws of the
jurisdiction in which such Property is located, together with financing
statements relating to the security interest granted thereunder;
(xii) An Assignment of Leases and Rents, the form of such
Assignment of Leases and Rents to be modified as appropriate to conform
to the Applicable Laws of the jurisdiction in which such Property is
located, together with assignments or other appropriate security
interests in form and substance satisfactory to the Agent covering each
letter of credit, guaranty and other credit enhancement for each Lease;
(xiii) An Environmental Indemnity Agreement executed by the
Borrower, and, if such Property is owned by a Subsidiary Borrower, such
Subsidiary Borrower;
(xiv) A Funds Transfer Agreement and related agreements for each
Construction Loan all in the form of Exhibit U executed by the Borrower
or the applicable Subsidiary Borrower, in form approved by and executed
by the Agent, relating to the manner of disbursement of Construction
Advances;
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(xv) Assignments to the Agent of all of the Borrower's (or the
applicable Subsidiary Borrower's) right, title and interest in and to
the Construction Contracts and in and to the Plans, together with the
consent of the Architect, the General Contractor and other appropriate
parties to the said assignment to the Agent and to the Agent's use of
said Construction Contracts and Plans for the benefit of the Lenders,
and the agreement of such parties to perform under the Construction
Contracts for the Agent and the Lenders upon occurrence of an Event of
Default;
(xvi) Assignments to Agent of all of the Borrower's (or the
applicable Subsidiary Borrower's) right, title and interest in and to
the Permits, to the fullest extent assignable, and, at the Agent's
election, the Permanent Loan Commitment and all refundable fees paid or
deposits made thereunder, to the extent assignable, together with the
consent of the lender under the Permanent Loan Commitment;
(xvii) A Property Management Contract Assignment (or an agreement
regarding termination thereof, at the Agent's election) covering the
Property Management Agreement, if any, for such Property;
(xviii) An opinion of counsel admitted to practice law in the
jurisdiction in which such Property is located and acceptable to the
Agent, addressed to the Agent and each Lender covering such legal
matters relating to the transactions contemplated hereby as the Agent
may reasonably request;
(xix) A Construction Guaranty executed and delivered by each of the
Borrower, the Parent and each Subsidiary required at such time to
provide a Construction Guaranty pursuant to Section 9.16., together
with each of the items required to be delivered to the Agent under
Section 9.16. by each such Subsidiary (if not previously delivered to
the Agent);
(xx) Subordination, non-disturbance and attornment agreements,
substantially in the form of Exhibit W, with such changes as may be
approved by the Agent, from each Major Tenant and each Anchor Tenant
leasing any of such Property and from other tenants of such Property
representing, in the aggregate, together with such Major Tenants and
Anchor Tenants, at least 70% of the net rentable square footage of the
Property or such lesser percentage as is approved by the Requisite
Lenders under Section 5.1.(a)(vi) above;
(xxi) Copies of all Property Management Agreements and all other
material contracts, if any, which will relate to the use, occupancy,
operation, maintenance, enjoyment or ownership of such Property at the
time it becomes a Construction Property, including without limitation,
upon the Agent's request, copies of all Construction Contracts not
previously delivered to the Agent pursuant to Section 5.1(a)(iv) above;
(xxii) If requested by the Agent, collateral assignments of the
other material contracts relating to the use, occupancy, operation,
maintenance, enjoyment or ownership of such Property;
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(xxiii) A current rent roll, including a lease maturity schedule,
for such Property, certified by a representative of the Borrower to be
true and correct;
(xxiv) Executed copies of the Architect's Contract (if any), the
General Contract and all other Construction Contracts;
(xxv) A list of all subcontractors and materialmen identified to
date who will provide services or material to the Mortgaged Property,
together with, if requested by the Agent, copies of the material
contracts with such subcontractors and materialmen. Borrower
acknowledges and agrees that all such subcontractors and materialmen,
and all such contracts, are subject to the approval of the Agent and
Independent Inspecting Architect;
(xxvi) Assurances from the Architect, the General Contractor and
all subcontractors, materialmen, laborers, and others sufficient to
assure the Agent and the Title Company that the rights of all
contractors, subcontractors, architects, engineers, surveyors,
sub-subcontractors and materialmen performing any work in connection
with the Improvements, or furnishing any services, labor or materials
to such Property, shall be subordinate and inferior to the Security
Deed;
(xxvii) Evidence of compliance by the Borrower (or the applicable
Subsidiary Borrower) with all the terms and provisions set forth in the
Permanent Loan Commitment (if any) on its part to be observed or
performed, and with all requirements (including, without limitation,
all construction and plan approval schedules) in the Leases on its part
to be observed or performed, nor shall there be any default by a Major
Tenant or Anchor Tenant under any of the Leases unless, without giving
effect to any Lease or Leases not in compliance with this clause, such
Property will continue to comply with the requirements in Section
5.1.(a)(vi);
(xxviii) In addition to evidence of the insurance required
hereunder, the Borrower shall also deliver evidence satisfactory to the
Agent that (i) the Architect (and any engineer) maintains professional
liability (errors and omissions) insurance, and (ii) the General
Contractor maintains xxxxxxx'x compensation insurance and public
liability insurance. Each such insurance policy shall be in form and
amounts reasonably satisfactory to the Agent;
(xxix) Evidence that such Property and the intended uses thereof
are in compliance with all applicable encumbrances and restrictions
(whether of record or otherwise) and all applicable laws, regulations
and ordinances, including, without limitation, the Americans with
Disabilities Act of 1990, as amended (42 U.S.C. ss. 12101, et seq.),
the Federal Architectural Barriers Act, as amended (42 U.S.C. ss. 4151,
et seq.), the Fair Housing Amendments Act of 1988, as amended (42
U.S.C. ss. 3601, et seq.) and The Rehabilitation Act of 1973, as
amended (29 U.S.C. ss. 794, et seq.). Such evidence may include
letters, licenses, permits, certificates and other correspondence from
the appropriate Governmental Authorities, opinions of the Borrower's
counsel or other counsel, and opinions or
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certifications from Architect or General Contractor. The laws,
regulations and ordinances with which compliance should be evidenced
include, in addition to the foregoing and without limitation, the
following: building codes, health and environmental protection laws,
erosion control ordinances, federal statutes, doing business and
licensing laws and zoning and other land use laws. Further, there shall
be no actions or proceedings pending before any court, quasi-judicial
or administrative body or regulatory agency relating to the
Construction Loan, the Property or the Borrower's use or proposed use
of the Property, and all appeal periods for any such prior proceedings
must have expired without any appeal having been filed;
(xxx) Approvals, letters, certificates or other evidence, in form
and substance acceptable to the Agent, from the appropriate
Governmental Authorities or private service providers (which approvals,
letters, certificates or other evidence shall state the expiration
date, if any, thereof) evidencing the availability, capacity and
suitability of electric, gas, telephone, water, sanitary sewer and
storm water drainage services needed to service properly such Property
for its intended use, and stating that no condition exists which
affects the Borrower's (or the applicable Subsidiary Borrower's) rights
to service by said utilities;
(xxxi) If required by the Agent, delivery to the Agent of
performance bonds and labor and material payment bonds as to General
Contractor and such subcontractors as may be required by the Agent
after a review of such subcontractor. The bonds shall be in form and
amounts satisfactory to the Agent, shall be issued by a bonding company
satisfactory to the Agent and shall contain a dual obligee rider,
naming the Agent and Lenders as a co-obligee. Any conditions in the
bonds must be approved in advance by the Agent;
(xxxii) Copies of all authorizations and Permits which are then
procurable and required by any Legal Requirement for the construction
and proposed use of the Improvements on such Property in accordance
with the Plans, and evidence of payment of permit fees and impact fees;
(xxxiii) Evidence that the Borrower has invested the Construction
Equity in the acquisition, development and construction of such
Property and related Improvements, and has provided documentation or
other evidence thereof satisfactory to the Agent;
(xxxiv) A certificate from the Architect and, if the Agent elects,
the Independent Inspecting Architect, stating that the Plans have been
approved by the Architect (or both the Architect and the Independent
Inspecting Architect) and that the Construction Contracts are
acceptable and satisfactorily provide for the construction of the
Improvements;
(xxxv) A site plan of the proposed Improvements, showing the
relation of the proposed Improvements by distances to the perimeter of
such Property and the proposed building lines, all acceptable to the
Title Company to modify the "areas, boundaries and encroachments"
exception to the maximum extent permitted by law;
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(xxxvi) A soils investigation report from a soils engineer
satisfactory to the Agent. The report shall address the ability of the
soil to support the Improvements, and shall include the recommendations
of the soil testing firm as to the preparation of the soil and the type
and design of the foundation needed in order to adequately support the
Improvements. The Borrower shall also submit to the Agent a report as
to concrete tests when so requested;
(xxxvii) Evidence that all real property and personal property ad
valorem taxes with respect to such Property have been paid, together
with copies of the most recent tax bills;
(xxxviii) If such Property is owned (or leased) by a Subsidiary
Borrower, each of the following (if not previously delivered to the
Agent):
(A) A Joinder Agreement substantially in the form of
Exhibit S executed by such Subsidiary Borrower;
(B) The certificate or articles of incorporation,
articles of organization, certificate of limited partnership,
declaration of trust or other comparable organizational instrument
(if any) of such Subsidiary Borrower certified as of a recent date
by the Secretary of State of the State of formation of such
Subsidiary Borrower;
(C) A Certificate of Good Standing or certificate of
similar meaning with respect to such Subsidiary Borrower issued as
of a recent date by the Secretary of State of the State of
formation of such Subsidiary Borrower and certificates of
qualification to transact business or other comparable certificates
issued by each Secretary of State (and any state department of
taxation, as applicable) of each state in which such Subsidiary
Borrower is required to be so qualified;
(D) A certificate of incumbency signed by the Secretary
or Assistant Secretary (or other individual performing similar
functions) of such Subsidiary Borrower with respect to each of the
officers of such Subsidiary Borrower authorized to execute and
deliver the Loan Documents to which such Subsidiary Borrower is a
party;
(E) copies certified by the Secretary or Assistant
Secretary of such Subsidiary Borrower (or other individual
performing similar functions) of (i) the by-laws of such Subsidiary
Borrower, if a corporation, the operating agreement, if a limited
liability company, the partnership agreement, if a limited or
general partnership, or other comparable document in the case of
any other form of legal entity and (ii) all corporate, partnership,
member or other necessary action taken by such Subsidiary Borrower
to authorize the execution, delivery and performance of the Loan
Documents to which it is a party;
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(xxxix) A copy of the forms of tenant lease to be used by the
Borrower (or Subsidiary Borrower, as applicable) in connection with the
Lease of any portion of such Property, which forms shall be reasonably
satisfactory in form and substance to the Agent;
(xxxx) The fees payable under Section 3.6.(e) with respect to
such Construction Loan;
(xxxxi) Assignments to Agent of all of the Borrower's (or the
applicable Subsidiary Borrower's) right, title and interest in and to
any sales contract or other agreement for sale then in existence for
any identified pad site within such Property, including an assignment,
pledge or security interest in all deposits, letters of credit or other
security posted or required thereunder as security for the other
party's performance, for the Borrower's (or the applicable Subsidiary
Borrower's) fees, reimbursements or the like, or otherwise, together
with the consent of the other parties to said contract or agreement if
required thereunder, and such further assurances as may be reasonably
required by the Agent to effectuate or perfect such assignment, pledge
or security interest;
(xxxxii) All costs and expenses then due and payable in
connection with the Construction Loan Security Documents, including,
without limitation, any matter set forth in Section 5.3(d) hereof, plus
fees associated with third party reports and all appraisal fees, which
amount shall in no event be refundable by the Agent; and
(xxxxiii) Such other instruments, diligence items, documents,
agreements, financing statements, certificates, opinions and other
Security Documents as the Agent may reasonably request.
(d) Cross-Collateralization and Cross-Default of Construction Loans.
All Construction Loan Security Documents for any given Construction Property
will be cross-collateralized and cross-defaulted with all Construction Loan
Security Documents for all other Construction Properties, and will be further
cross-defaulted with all other Loan Documents, all subject to and in accordance
with the terms of the Loan Documents, including Section 11.1.(k). The
Construction Loan Security Documents for any particular Construction Property
shall secure the entire $75,000,000.00 potential maximum amount of Construction
Loans, but the Borrower may make proposals to the Agent regarding availability
of any allocation, apportionment or similar provisions under applicable state
law in order to minimize, reduce or eliminate applicable mortgage, documentary
stamp, intangible or similar taxes calculated on the amount of debt secured by
the applicable Security Instrument, and so long as no Event of Default shall
then be in existence, the Agent will use reasonable efforts to implement such
proposal if, in the Agent's reasonable judgment, the Lenders and the security of
the Mortgaged Property will be protected as contemplated by this Agreement and
the other Construction Loan Security Documents; provided, however, that the
Agent shall have no obligation to limit the amount secured by any Construction
Loan Security Document in order to reduce such taxes if no allocation,
apportionment or similar arrangement is available.
(e) Release of a Construction Property. No Construction Property shall
be released from the applicable Construction Loan Security Documents until all
Construction Advances made with respect to such Construction Property and all
other amounts due with respect to such Construction Property are repaid in full
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and the Lenders have no further obligation to fund Construction Advances with
respect to such Construction Property. After receipt of such payment, the Agent
shall release its Lien on such Construction Property and all other Mortgaged
Property associated with such Construction Property so long as no Default or
Event of Default shall then be in existence or would occur as a result of such
release.
(f) Release of a Pad Site from a Construction Property. From time to
time the Borrower may request, upon not less than 30 days prior written notice
to the Agent (a copy of which notice the Agent shall promptly provide to the
Lenders), that a pad site within a Construction Property be released from the
Liens of the applicable Construction Loan Security Documents. For purposes of
this release provision, the phrase "pad site" refers to the portion of such
Property to be released, which portion may be unimproved, partially improved or
fully improved. The Agent shall promptly commission at the Borrower's expense,
if the Agent deems it necessary, an Appraisal of such Construction Property,
exclusive of the pad site, to be in form and substance satisfactory to the
Agent. The Agent shall review such Appraisal within 10 Business Days of receipt
and so long as after any such review, the Agent is prepared to recommend such
release, the Agent shall promptly notify each Lender of the Borrower's request,
forward such Appraisal and its determination of the Appraised Value of such
Construction Property (exclusive of the pad site) to the Lenders. Promptly
thereafter, the Agent shall grant such request and release its Lien on such pad
site (but not on the balance of said Construction Property and the Mortgaged
Property associated therewith) if all of the following conditions are satisfied:
(i) no Default or Event of Default shall have occurred and be
continuing both at the time of such request and immediately after
giving effect to such request;
(ii) the Borrower shall have delivered to the Agent evidence
satisfactory to the Agent as to form and content that the Construction
Property, after such release, will be in conformity with all Applicable
Laws, including without limitation zoning, parking and subdivision
requirements, and in connection therewith the Agent may require an
endorsement to the Title Policy covering said Property; that the
remaining Construction Property has sufficient routes of ingress and
egress as deemed appropriate by the Agent; and that the release or
separate ownership of said pad will not result or be likely to result
in violations of any restrictive covenants or Leases affecting said
Construction Property;
(iii) the Borrower shall have delivered such other
instruments, documents, agreements or other items as the Agent may
reasonably request.
For release of a pad site which was contemplated at the time a Property became a
Construction Property, if the pad site was excluded from the Appraisal obtained
at that time, no further Appraisal will be required under this Section for a
release of such pad site, but the other requirements of this Section 5.1(f)
shall apply.
(g) Reborrowing Construction Advances. If the Agent has agreed that
Construction Equity for a particular Construction Property may include sales
proceeds from the sale of a pad site located within such Construction Property,
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the Borrower (or Subsidiary Borrower, as applicable), may, at the time the sale
of the pad site is consummated, repay Construction Advances then outstanding
under such Construction Loan, and the Borrower (or Subsidiary Borrower, as the
case may be), may thereafter reborrow Construction Advances with respect to such
Construction Property in an amount up to the amount of Construction Equity for
which such sales proceeds were the allocated source as approved by the Agent
(but in no event more than was so repaid), on satisfaction and compliance with
the same terms and conditions applicable to the previous Construction Advances.
Section 5.2. Requests for and Disbursements of Construction Advances.
(a) Requesting Construction Advances; Monthly Disbursement Requests.
The Borrower shall give the Agent notice pursuant to a Disbursement Request for
each borrowing of Construction Advances under a Construction Loan. The Borrower
(or Subsidiary Borrower, as the case may be) shall submit to the Agent, not more
frequently than monthly, a Disbursement Request for Construction Advances of a
Construction Loan, signed by the Borrower, the Architect and, if the Agent
requests, the Independent Inspecting Architect. Each Disbursement Request shall
be delivered to the Agent before 9:00 a.m. on the date seven Business Days prior
to the proposed date of such borrowing. The Agent will transmit by telecopy or
other similar form of transmission the Disbursement Request (or an abbreviated
form of such Disbursement Request) to each Lender promptly upon receipt by the
Agent. Each Disbursement Request shall be irrevocable once given and binding on
the Borrower. Each Disbursement Request submitted shall constitute a
representation and warranty by the Borrower to the Agent that the Borrower (and
the Subsidiary Borrower, if applicable) is in compliance with all the conditions
precedent as specified in this Agreement and in the applicable Construction Loan
Security Documents. In addition to monthly Construction Advances made pursuant
to a Disbursement Request, the Agent may make disbursements of Construction
Advances for accrued interest under the interest reserve of the applicable Cost
Breakdown, or otherwise as described in Section 5.2.(h).
(b) Deposits of Construction Advances by the Lenders. If the
Disbursement Request is in form and substance (and supported by such backup
materials) as are acceptable to the Agent, then no later than 9:00 a.m. on the
date specified in the Disbursement Request, each Lender will make available for
the account of its applicable Lending Office to the Agent, in immediately
available funds, the proceeds of the Construction Advances to be made by such
Lender. With respect to Construction Advances, unless the Agent shall have been
notified by any Lender prior to the specified date of borrowing that such Lender
does not intend to make available to the Agent the Construction Advance to be
made by such Lender on such date, the Agent may assume that such Lender will
make the proceeds of such Construction Advance available to the Agent on the
date of the requested borrowing as set forth in the Disbursement Request and the
Agent may (but shall not be obligated to), in reliance upon such assumption,
make available to the Borrower the amount of such Construction Advance to be
provided by such Lender. Subject to satisfaction of the applicable conditions
contained in this Article and in Article VII. for such borrowing, the Agent will
make the proceeds of such borrowing available to the Borrower no later than
12:00 noon on the date and at the account specified by the Borrower in such
Disbursement Request.
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(c) Additional Conditions to Construction Advances. The following are
conditions to the making of each Construction Advance:
(i) The Agent shall have the right to condition any disbursement
upon the Agent's receipt and approval of the Architect's and/or
Independent Inspecting Architect's periodic certifications of the
percentage and/or stage of construction that has been completed and
requirements based upon any such party's periodic, physical inspection
of the subject Construction Property and Improvements.
(ii) In addition to all other requirements of this Agreement, the
Lenders shall not be obligated to make any Construction Advances to the
Borrower with respect to a Construction Property unless all
representations, warranties and covenants set forth in the Construction
Loan Security Documents for such Construction Property are true and
correct and the Borrower (or Subsidiary Borrower, as the case may be)
and such Construction Property is in compliance with all provisions of
the applicable Construction Loan Security Documents.
(iii) The Agent shall have received (a) an endorsement to the
applicable Title Insurance Policy showing an increase in coverage
thereof to the full amount of all Construction Advances made with
respect to such Construction Property, and reflecting no changes in the
status of title or the Title Insurance Policy since the previous
disbursement of Construction Advances, as well as an endorsement (if
such endorsement is available under applicable state title insurance
laws) after completion of foundations reflecting no encroachments
caused by construction of the Improvements, (b) certification from the
Architect and, if the Agent elects, the Independent Inspecting
Architect stating that, in their opinion, the construction of the
Improvements theretofore performed has been in substantial accordance
with the Plans, (c) an updated survey of said Construction Property at
such time as the foundations are complete and at such other times as
may be required by the Title Company to issue the endorsements referred
to above, or in lieu thereof the Agent may accept an engineer's
certificate, (d) at the request of the Agent, lien waivers or releases
(in recordable form, if required or customary under the law where such
Construction Property is located) from all contractors, subcontractors,
laborers and materialmen employed or furnishing materials in connection
with the construction of the Improvements, (e) at the request of the
Agent, a written certification signed by the Borrower as to all new
Leases and the names of the tenants and rents payable thereunder,
together with copies of all such Leases, and (f) such other
certifications or evidence of cost and completion as the Agent may
request.
(iv) The Borrower shall have deposited with the Agent a
Supplemental Equity Deposit, if then applicable.
(v) The requested Construction Advances, plus the sum of the
previously advanced Construction Advances (including retained amounts
deemed to have been advanced pursuant to the immediately following
subsection (d)) and any other sums disbursed by the Agent under the
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Construction Loan Security Documents for the applicable Construction
Property, do not exceed the applicable Construction Loan Limit.
(vi) The Lenders shall not be required to make any
Construction Advances with respect to a particular Construction
Property if, at the time of the requested advance, any of the
conditions described in the following exists with respect to such
Construction Property:
(A) In the good faith judgment of the Agent, Completion
of the Improvements will not occur on or before the applicable
Completion Date, regardless of the cause of such failure of
completion.
(B) The Mortgaged Property (or any portion thereof) is
demolished or substantially destroyed, or condemnation or
similar type proceedings are commenced with reference thereto
and insurance proceeds are not being made available for
restoration pursuant to the terms of the Construction Loan
Security Documents;
(C) An order or decree of any court of competent
jurisdiction exists enjoining the construction of the
Improvements or enjoining or prohibiting the Borrower (or the
Subsidiary Borrower, as the case may be), the Agent or any
Lender or either of them from performing their respective
obligations under this Article V and/or under the Construction
Loan Security Documents relating to such Construction
Property; provided, however, that this clause shall not
prohibit the Borrower from exercising its rights under Section
3.10. with respect to any Lender which, as a result of any of
the events or circumstances referred to in this clause, is a
Defaulting Lender;
(D) Any material deviation from the applicable Plans
exists in the construction of the Improvements without the
prior written approval of the Agent, or it appears to the
Agent or the Independent Inspecting Architect that there are
material defects in the workmanship or materials;
(E) An Event of Default exists under this Agreement, or
under any Construction Loan Security Documents relating to
such Construction Property;
(F) The Borrower is unable to satisfy all of the
conditions set forth in Section 5.1(c) with respect to such
Construction Advance;
(G) Any change in the status of title to such
Construction Property or the related Improvements has occurred
subsequent to the effective date of the applicable
Construction Loan Security Documents without the Agent's prior
written consent, other than easements which are not material
in nature or scope but which are necessary for the development
of the Construction Property in accordance with the Plans and
the Cost Breakdown and other than the recording of Leases with
respect to such Construction Property;
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(H) Any event has occurred which has or is likely to give
rise to a Lien equal or superior to the Lien created or
intended to be created by the applicable Construction Loan
Security Documents other than Permitted Liens;
(I) Borrower is not in compliance with the Disbursement
Schedule for such Construction Property;
(J) Any encroachment on or off said Construction Property
exists that has not been approved by the Agent; or
(K) Construction has ceased prior to Completion of
Improvements for a continuous period of twenty (20) days or
more for causes other than those beyond the control of the
Borrower or those consented to in writing by the Agent or,
provided that the Completion Date must still be met, those
scheduled by the Borrower in order to provide portions of the
Improvements to a prospective tenant at a time agreed to by
the Borrower.
(d) Retainage. From each advance of Construction Advances made to the
Borrower hereunder to be used to fund hard costs under the Construction
Contracts, a sum equal to ten percent (10%) thereof (or a greater percentage, if
required by any Legal Requirement) shall remain undisbursed until the Agent
receives certification from the Agent's Independent Inspection Architect that
the Improvements are fifty percent (50%) complete, at which time no further
retainage shall be withheld so long as the amount of retainage held by the Agent
is at all times at least five percent (5%) of the Cost Breakdown for such costs,
so that, until a period of thirty (30) days after Completion of the Improvements
(or such longer period if permitted or required by any Legal Requirement or if,
during such longer period, a lien or claim could lawfully be filed against the
applicable Mortgaged Property by anyone performing work or services, or
furnishing materials or goods in connection with the Improvements) there shall
remain undisbursed from the applicable Construction Loan Limit an amount equal
to five percent (5%) of the total cost of the Improvements under the
Construction Contracts; provided, however, that if the retainage amount required
by applicable law is greater than 5%, such greater amount shall remain
undisbursed from the applicable Construction Loan Limit until Completion of such
Improvements.
(e) Manner of Disbursements; Right to Disbursements. For each
Construction Loan, Construction Advances thereunder shall be made to the
Borrower at the times and otherwise in accordance with the Disbursement
Schedule, and otherwise in accordance with the terms of this Agreement.
Construction Advances shall be disbursed for the account of the Borrower, at the
Borrower's option prior to a Default or Event of Default and thereafter at the
Agent's option, (i) by the Agent's check drawn upon the Agent's disbursement
account and delivered to the Borrower, (ii) by depositing the amount of the
disbursement to the Borrower's account in a bank approved by the Agent, (iii) by
direct or joint check payment to any or all persons entitled to payment for work
performed on or materials delivered to or services performed in connection with
the applicable Construction Property, or (iv) by any other method the Agent
shall from time to time elect. Under no circumstances shall any portion of any
Construction Loan be used for any purpose other than the payment of those costs
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and fees approved by the Agent as set forth on the Cost Breakdown and
legitimately relating to the cost of constructing the Improvements.
(f) Construction Advances for Specific Items. Disbursements of
Construction Advances shall be made for the upfitting and finishing of leased
space in Improvements of a Construction Property, for the Contractor's fee, for
interest accrued on Construction Advances, from the contingency reserve in the
applicable Cost Breakdown and for the final advance for Improvements for a
particular Construction Property in accordance with this Agreement and with the
Disbursement Schedule approved by the Agent and executed and delivered by the
Borrower (or the applicable Subsidiary Borrower) in connection with each
Construction Loan.
(g) Supplemental Equity Deposit. If, in the good faith judgment of the
Agent, at any time or from time to time with respect to any Construction
Property a Supplemental Equity Deposit is required, the Borrower shall
immediately deposit, or shall make arrangements satisfactory to the Agent, for
the deposit with the Agent of a Supplemental Equity Deposit. The Supplemental
Equity Deposit shall not be deemed trust funds, may be retained by the Agent in
an interest bearing account, need not be segregated from any of the Agent's
other funds and may be disbursed in accordance with the provisions of this
Agreement and the applicable Construction Loan Security Documents by the Agent
before any further Construction Advances are made or required to be made
hereunder. The Borrower's failure to deposit the Supplemental Equity Deposit
with the Agent shall constitute an event of default under the applicable
Construction Loan Security Documents.
(h) Disbursements to the Agent. Notwithstanding anything to the
contrary contained in this Article V or elsewhere in this Agreement or the
applicable Construction Loan Security Documents, the Agent shall have the right
to disburse to itself or the Lenders as Construction Advances any and all
amounts due the Agent or any of the Lenders on account of the Construction Loan
(including interest and other amounts required under the applicable Construction
Loan Security Documents), without the necessity of any Disbursement Request or
other action by the Borrower. In no event shall any such disbursement be
construed as a waiver of a Default or Event of Default or any other condition to
any other disbursements to or for the benefit of the Borrower.
Section 5.3. Inspection.
(a) Right of Inspection. In addition to the provisions of any of the
Loan Documents, and not in limitation thereof, the Agent, through its officers,
agents or employees (and, only with respect to Section 5.3(a)(i) below, each of
the Lenders), shall have the right at all reasonable times at the Borrower's
expense:
(i) To enter upon any Construction Property and inspect the
construction of the Improvements to determine that they are in
conformity with the applicable Plans and all the requirements hereof
and of the applicable Construction Loan Security Documents;
(ii) To examine, copy and make extracts of the books, records,
accounting data and other documents of the Borrower (or the Subsidiary
Borrower, as applicable) that relate in any way to such Construction
Property, including, without limiting the generality of the foregoing,
all permits, licenses, consents and approvals of all Governmental
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Authorities having jurisdiction over the Borrower, said Subsidiary
Borrower or the Construction Property and, to the extent available to
Borrower or such Subsidiary Borrower, all relevant books and records of
contractors and subcontractors supplying goods and/or services in
connection with the construction of the Improvements. All such books,
records and documents shall be made available to the Agent promptly
upon written demand therefor; and, at the request of the Agent, the
Borrower shall furnish the Agent with convenient facilities for the
foregoing purpose; and
(iii) In furtherance of the Agent's rights hereunder, the Agent
may, at its option, (x) require an inspection of the applicable
Construction Property by the Independent Inspecting Architect (1) prior
to each advance; (2) at least once each month during the course of
construction even though no advance is to be made for that month; (3)
upon Completion of the Improvements, and (4) at least semiannually
thereafter; and (y) require costing and a review of the Plans by the
Independent Inspecting Architect and/or a cost engineering specialist,
or any other party contracted by the Agent.
(b) No Duty to Inspect. It is expressly understood and agreed that
neither the Agent nor any Lender shall have any duty to supervise or to inspect
the construction of the Improvements at any Construction Property or any books
and records of any party or firm relating thereto, and that any such inspection
shall be for the sole purposes of determining whether or not the obligations of
the Borrower under this Agreement with respect to Construction Properties are
being properly discharged and of preserving the Agent's and/or any Lender's
rights hereunder. If any of the Lenders, the Agent, or the Independent
Inspecting Architect acting on behalf of the Agent, should inspect the
construction of any Improvements or any books and records, such Lender(s), the
Agent and the Independent Inspecting Architect shall have no liability or
obligation to the Borrower or any third party arising out of such inspection.
Inspection not followed by notice of default shall not constitute an
acknowledgment or representation by any Lender, the Agent and the Independent
Inspecting Architect that there has been or will be compliance with the
applicable Plans or that the construction is free from defective materials or
workmanship nor shall it constitute a waiver of the Agent's or any of the
Lenders' rights thereafter to insist that the Improvements be constructed in
accordance with the applicable Plans. The Agent's or any Lender's failure to
inspect the construction of any Improvements or any part thereof or any books
and records shall not constitute a waiver of any of the Agent's or any Lender's
rights hereunder. Neither the Borrower nor any third party shall be entitled to
rely upon any such inspection or review. The Agent, the Independent Inspecting
Architect and the Lenders owe no duty of care to the Borrower or any third
person to protect against, or inform the Borrower or any third person of the
existence of, negligent, faulty, inadequate or defective design or construction
of the Improvements at any Construction Property.
(c) The Borrower's Responsibilities. The Borrower (or Subsidiary
Borrower, if Borrower is not the owner of a particular Construction Property)
shall be solely responsible for all aspects of the Borrower's (or such
Subsidiary Borrower's) business and conduct in connection with each Construction
Property and related Improvements, including, without limiting the generality of
the foregoing:
(i) the quality and suitability of the Plans;
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(ii) supervision of construction of the Improvements;
(iii) the qualifications, financial condition and performance of
all architects, engineers, contractors, subcontractors and material
suppliers, consultants, and property managers;
(iv) conformance of construction of the Improvements to the Plans,
to the Legal Requirements and to the requirements of this Agreement and
the applicable Construction Loan Security Documents;
(v) the quality and suitability of all materials and workmanship;
and
(vi) the accuracy of all requests for the disbursement of
Construction Advances and the proper application of disbursed
Construction Advances.
(d) Inspection Expenses. The Borrower shall pay all fees incurred by
the Agent for all costing, review or inspection of each Construction Property.
Furthermore, if the Agent determines in connection with any such costing, review
or inspection that extra services will be required of the Independent Inspecting
Architect as a result of noncompliance with the applicable Plans, or with any
Legal Requirement or as a result of deviations from acceptable construction
practices, or as a result of the Borrower's failure to satisfy the requirements
of this Agreement, any Permanent Loan Commitment, any Construction Contract, any
Construction Loan Security Document or any Permit, the Borrower shall pay, in
addition to the fees for such costing, review of the Plans and inspections, the
cost of all such extra services.
Section 5.4. Extension of Construction Loan Maturity Date(s).
The Borrower may request that the Construction Loan Maturity Date with
respect to a Construction Loan be extended by one year by executing and
delivering to the Agent at least 60 days but not more than 90 days prior to the
current Construction Loan Maturity Date, a written request for such extension.
The Agent shall forward to each Lender a copy of any such request delivered to
the Agent promptly upon receipt thereof. Subject to satisfaction of the
following conditions, such Construction Loan Maturity Date shall be extended for
one year:
(i) immediately prior to such extension, no Default or Event of
Default shall have occurred and be continuing or would exist
immediately after giving effect to such extension;
(ii) if the Requisite Lenders have directed the Agent to obtain a
new Appraisal of such Construction Property, the Construction Loan
Limit with respect to such Construction Property shall not exceed (A)
75.0% of the "as is" market value of such Construction Property as
reflected in such Appraisal as such value may have been adjusted by the
Agent as provided in the definition of Appraised Value and (B) 70.0% of
the "stabilized value" of such Construction Property as reflected in
such Appraisal as such value may have been adjusted by the Agent as
provided in the definition of Appraised Value;
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(iii) the Debt Service Coverage Ratio for such Construction
Property equals or exceeds 1.20 to 1;
(iv) the Occupancy Rate of such Construction Property equals or
exceeds 70.0% (such Occupancy Rate to be calculated assuming completion
of such Construction Property in accordance with the applicable Plans)
and 85.0% of the projected rentable square footage of such Construction
Property is subject to Leases;
(v) the Borrower shall have delivered to the Agent a certificate
from the chief financial officer of the Parent certifying the matters
set forth in the preceding clauses (i) through (iv), such certificate
to be in form and substance satisfactory to the Agent;
(vi) the Borrower shall have delivered to the Agent an executed
estoppel certificate in form and substance satisfactory to the Agent
from each tenant under an Approved Lease which the Borrower is then
able to obtain; and
(vii) the Borrower shall have paid the Fees payable under Section
3.6.(f).
Notwithstanding the foregoing, if the Borrower could not comply with any of the
conditions set forth in clauses (i) through (vii) above and the Borrower can
cure such failure by repaying a portion of the outstanding Construction Advances
with respect to such Construction Loan, then the Borrower may make such
repayment and, if all of such conditions are then satisfied, the Construction
Loan Maturity Date shall be extended for one year. If the Borrower did not
deliver estoppel certificates under the immediately preceding clause (vi) for
any tenant under an Approved Lease, the Borrower agrees to exercise commercially
reasonable efforts to obtain and deliver to the Agent any remaining estoppels
within 120 days after the applicable tenant(s) has opened for business.
Section 5.5. General Terms and Provisions.
(a) No Third Party Beneficiaries. All conditions precedent to the
Lenders' obligations to make Construction Advances are imposed solely and
exclusively for the Lenders' and the Agent's benefit. No person or entity other
than the Agent or a Lender shall have any standing to require satisfaction of
such conditions, or be entitled to assume that the Agent or a Lender will refuse
to make Construction Advances absent strict compliance therewith, and any or all
of such conditions may be freely waived (in whole or in part) by the Agent at
any time or times.
(b) No Waiver. No disbursement by the Agent or the Lenders of
Construction Advances hereunder notwithstanding the Borrower's (or the
applicable Subsidiary Borrower's) failure to strictly comply with this Agreement
or the applicable Construction Loan Security Documents shall, in any way,
preclude the Agent from thereafter declaring such failure to comply to be a
Default or an Event of Default hereunder.
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ARTICLE VI. YIELD PROTECTION, ETC.
Section 6.1. Additional Costs; Capital Adequacy.
(a) Additional Costs. The Borrower shall promptly pay to the Agent for
the account of a Lender from time to time such amounts as such Lender may
reasonably determine to be necessary to compensate such Lender for any costs
incurred by such Lender that it determines are attributable to its making or
maintaining of any LIBOR Loans or its obligation to make any LIBOR Loans
hereunder, any reduction in any amount receivable by such Lender under this
Agreement or any of the other Loan Documents in respect of any of such Loans or
such obligation or the maintenance by such Lender of capital in respect of its
Loans or its Commitments (such increases in costs and reductions in amounts
receivable being herein called "Additional Costs"), resulting from any
Regulatory Change that: (i) changes the basis of taxation of any amounts payable
to such Lender under this Agreement or any of the other Loan Documents in
respect of any of such Loans or its Commitments (other than taxes imposed on or
measured by the overall net income of such Lender or of its Lending Office for
any of such Loans by the jurisdiction in which such Lender has its principal
office or such Lending Office); or (ii) imposes or modifies any reserve, special
deposit or similar requirements (including without limitation, Regulation D of
the Board of Governors of the Federal Reserve System or other similar reserve
requirement applicable to any other category of liabilities or category of
extensions of credit or other assets by reference to which the interest rate on
LIBOR Loans is determined) relating to any extensions of credit or other assets
of, or any deposits with or other liabilities of, such Lender, or any commitment
of such Lender (including, without limitation, the Commitments of such Lender
hereunder); or (iii) has or would have the effect of reducing the rate of return
on capital of such Lender to a level below that which such Lender could have
achieved but for such Regulatory Change (taking into consideration such Lender's
policies with respect to capital adequacy).
(b) Lender's Suspension of LIBOR Loans. Without limiting the effect of
the provisions of the immediately preceding subsection (a), if by reason of any
Regulatory Change, any Lender either (i) incurs Additional Costs based on or
measured by the excess above a specified level of the amount of a category of
deposits or other liabilities of such Lender that includes deposits by reference
to which the interest rate on LIBOR Loans is determined as provided in this
Agreement or a category of extensions of credit or other assets of such Lender
that includes LIBOR Loans or (ii) becomes subject to restrictions on the amount
of such a category of liabilities or assets that it may hold, then, if such
Lender so elects by notice to the Borrower (with a copy to the Agent), the
obligation of such Lender to make or Continue, or to Convert any other Type of
Loans into, LIBOR Loans hereunder shall be suspended until such Regulatory
Change ceases to be in effect (in which case the provisions of Section 6.5.
shall apply).
(c) Additional Costs in Respect of Letters of Credit. Without limiting
the obligations of the Borrower under the preceding subsections of this Section
(but without duplication), if as a result of any Regulatory Change or any
risk-based capital guideline or other requirement heretofore or hereafter issued
by any Governmental Authority there shall be imposed, modified or deemed
applicable any tax, reserve, special deposit, capital adequacy or similar
requirement against or with respect to or measured by reference to Letters of
Credit and the result shall be to increase the cost to the Agent of issuing (or
any Lender purchasing participations in) or maintaining its obligation hereunder
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to issue (or purchase participations in) any Letter of Credit or reduce any
amount receivable by the Agent or any Lender hereunder in respect of any Letter
of Credit, then, upon demand by the Agent or such Lender, the Borrower shall pay
immediately to the Agent for its account or the account of such Lender, as
applicable, from time to time as specified by the Agent or a Lender, such
additional amounts as shall be sufficient to compensate the Agent or such Lender
for such increased costs or reductions in amount.
(d) Notification and Determination of Additional Costs. Each of the
Agent and each Lender agrees to notify the Borrower of any event occurring after
the Agreement Date entitling the Agent or such Lender to compensation under any
of the preceding subsections of this Section as promptly as practicable;
provided, however, the failure of the Agent or any Lender to give such notice
shall not release the Borrower from any of its obligations hereunder. The Agent
and or such Lender agrees to furnish to the Borrower a certificate setting forth
the basis and amount of each request by the Agent or such Lender for
compensation under this Section. Determinations by the Agent or any Lender of
the effect of any Regulatory Change shall be conclusive absent manifest error,
provided that such determinations are made on a reasonable basis and in good
faith.
Section 6.2. Suspension of LIBOR Loans.
Anything herein to the contrary notwithstanding, if, on or prior to the
determination of LIBOR for any Interest Period: (a) the Agent determines (which
determination shall be conclusive) that by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist for ascertaining the
LIBOR for such Interest Period or (b) the Agent determines (which determination
shall be conclusive) that LIBOR will not adequately and fairly reflect the cost
to the Lenders of making or maintaining LIBOR Loans for such Interest Period;
then the Agent shall give the Borrower and each Lender prompt notice thereof,
and, so long as such condition remains in effect, the Lenders shall be under no
obligation to, and shall not, make additional LIBOR Loans, Continue LIBOR Loans
or Convert Loans into LIBOR Loans and the Borrower shall, on the last day of
each current Interest Period for each outstanding LIBOR Loan, either repay such
Loan or Convert such Loan into a Base Rate Loan in accordance with Section 6.5.
Section 6.3. Illegality.
Notwithstanding any other provision of this Agreement, if it becomes
unlawful for any Lender to honor its obligation to make or maintain LIBOR Loans
hereunder, then such Lender shall promptly notify the Borrower thereof (with a
copy to the Agent) and such Lender's obligation to make or Continue, or to
Convert Loans of any other Type into, LIBOR Loans shall be suspended until such
time as such Lender may again make and maintain LIBOR Loans (in which case the
provisions of Section 6.5. shall be applicable).
Section 6.4. Compensation.
The Borrower shall pay to the Agent for the account of each Lender,
upon the request of such Lender through the Agent, such amount or amounts as
shall be sufficient (in the reasonable opinion of such Lender) to compensate it
for any loss, cost or expense that such Lender determines is attributable to:
(a) any payment or prepayment (whether mandatory or optional) of a LIBOR Loan,
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or Conversion of a LIBOR Loan, made by such Lender for any reason (including,
without limitation, acceleration) on a date other than the last day of the
Interest Period for such Loan or (b) any failure by the Borrower for any reason
(including, without limitation, the failure of any of the applicable conditions
precedent specified in Article VII. to be satisfied) to borrow a LIBOR Loan from
such Lender on the date for such borrowing, or to Convert a Base Rate Loan into
a LIBOR Loan or Continue a LIBOR Loan on the requested date of such Conversion
or Continuation. Upon the Borrower's request, any Lender requesting compensation
under this Section shall provide the Borrower with a statement setting forth the
basis for requesting such compensation and the method for determining the amount
thereof. Any such statement shall be conclusive absent manifest error.
Section 6.5. Treatment of Affected Loans.
If the obligation of any Lender to make LIBOR Loans or to Continue, or
to Convert Base Rate Loans into, LIBOR Loans shall be suspended pursuant to
Section 6.1.(b), 6.2. or 6.3., then such Lender's LIBOR Loans shall be
automatically Converted into Base Rate Loans on the last day(s) of the then
current Interest Period(s) for LIBOR Loans (or, in the case of a Conversion
required by Section 6.1.(b) or 6.3., on such earlier date as such Lender may
specify to the Borrower with a copy to the Agent) and, unless and until such
Lender gives notice as provided below that the circumstances specified in
Section 6.1., 6.2. or 6.3. that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's LIBOR Loans have been so Converted, all
payments and prepayments of principal that would otherwise be applied to such
Lender's LIBOR Loans shall be applied instead to its Base Rate Loans and (b) all
Loans that would otherwise be made or Continued by such Lender as LIBOR Loans
shall be made or Continued instead as Base Rate Loans, and all Base Rate Loans
of such Lender that would otherwise be Converted into LIBOR Loans shall remain
as Base Rate Loans. If such Lender gives notice to the Borrower (with a copy to
the Agent) that the circumstances specified in Section 6.1. or 6.3. that gave
rise to the Conversion of such Lender's LIBOR Loans pursuant to this Section no
longer exist (which such Lender agrees to do promptly upon such circumstances
ceasing to exist) at a time when LIBOR Loans made by other Lenders are
outstanding, then such Lender's Base Rate Loans shall be automatically
Converted, on the first day(s) of the next succeeding Interest Period(s) for
such outstanding LIBOR Loans, to the extent necessary so that, after giving
effect thereto, all Loans held by the Lenders holding LIBOR Loans and by such
Lender are held pro rata (as to principal amounts, Types and Interest Periods)
in accordance with their respective Commitments.
Section 6.6. Change of Lending Office.
Each Lender agrees that it will use reasonable efforts to designate an
alternate Lending Office with respect to any of its Loans affected by the
matters or circumstances described in Sections 3.11., 6.1. or 6.3. to reduce the
liability of the Borrower or avoid the results provided thereunder, so long as
such designation is not disadvantageous to such Lender as determined by such
Lender in its sole discretion, except that such Lender shall have no obligation
to designate a Lending Office located in the United States of America.
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ARTICLE VII. CONDITIONS PRECEDENT
Section 7.1. Initial Conditions Precedent.
The obligation of the Agent and the Lenders to effect or permit the
occurrence of the first Credit Event hereunder, whether as the making of a Loan
or the issuance of a Letter of Credit, is subject to the following conditions
precedent:
(a) The Agent shall have received each of the following, in form and
substance satisfactory to the Agent:
(i) counterparts of this Agreement executed by each of the parties
hereto;
(ii) Revolving Notes executed by the Borrower, payable to each
Lender and complying with the terms of Section 2.11.(a), and the
Swingline Note executed by the Borrower;
(iii) the Guaranty executed by each of the Guarantors initially to
be a party thereto;
(iv) favorable UCC, tax, judgment and lien search reports with
respect to the Parent, the Borrower and each of the initial Guarantors
owning a Borrowing Base Property in all necessary or appropriate
jurisdictions and under all legal and appropriate trade names
indicating that there are no prior Liens on any of the assets of such
Persons other than Permitted Liens or Liens which are to be terminated
prior to the Effective Date;
(v) an opinion of Drinker Xxxxxx & Xxxxx LLP, counsel to the
Parent, the Borrower, the Guarantors, addressed to the Agent and the
Lenders and in substantially the form of Exhibit D;
(vi) the Certificate of Limited Partnership of the Borrower
certified as of a recent date by the Secretary of State of the State of
Delaware;
(vii) a Certificate of Good Standing with respect to the Borrower
issued as of a recent date by the Secretary of State of the State of
Delaware and certificates of qualification to transact business or
other comparable certificates with respect to the Borrower issued by
each Secretary of State (and any state department of taxation, as
applicable) of each state in which the Borrower is required to be so
qualified;
(viii) a certificate of incumbency signed by the Secretary or
Assistant Secretary of the Parent with respect to each of the officers
of the Parent authorized to execute and deliver on behalf of the Parent
and the Borrower the Loan Documents to which the Parent or the Borrower
is a party and to execute and deliver (or make by telephone in the case
of Notices of Conversion or Continuation) on behalf of the Borrower
Notices of Borrowing, Notices of Swingline Borrowing, Notices of
Conversion, Notices of Continuation and Disbursement Requests;
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(ix) a certified copy (certified by the Secretary or Assistant
Secretary of the Parent) of the Trust Agreement, the Partnership
Agreement and of all necessary action taken by the Parent to authorize
the execution, delivery and performance of the Loan Documents to which
either the Parent or the Borrower is a party;
(x) the certificate or articles of incorporation, articles of
organization, certificate of limited partnership, declaration of trust
or other comparable organizational instrument (if any) of each
Guarantor certified as of a recent date by the Secretary of State of
the State of formation of such Person;
(xi) a Certificate of Good Standing or certificate of similar
meaning with respect to each Guarantor issued as of a recent date by
the Secretary of State of the State of formation of each such Person
and certificates of qualification to transact business or other
comparable certificates issued by each Secretary of State (and any
state department of taxation, as applicable) of each state in which
such Person is required to be so qualified;
(xii) a certificate of incumbency signed by the Secretary or
Assistant Secretary (or other individual performing similar functions)
of each Guarantor with respect to each of the officers of such Person
authorized to execute and deliver the Loan Documents to which such
Person is a party;
(xiii) copies certified by the Secretary or Assistant Secretary of
each Guarantor (or other individual performing similar functions) of
(i) the by-laws of such Person, if a corporation, the operating
agreement, if a limited liability company, the partnership agreement,
if a limited or general partnership, or other comparable document in
the case of any other form of legal entity and (ii) all corporate,
partnership, member or other necessary action taken by such Person to
authorize the execution, delivery and performance of the Loan Documents
to which it is a party;
(xiv) a Borrowing Base Certificate calculated as of the Effective
Date (but using Net Operating Income from financial statements for the
fiscal quarter ending September 30, 2000), which Borrowing Base
Certificate shall indicate that the Borrower has sufficient borrowing
capacity, as of the Effective Date, to satisfy in full all of the
obligations outstanding under the Existing Credit Agreement immediately
prior to the effectiveness of this Agreement;
(xv) a Compliance Certificate calculated on a pro forma basis for
the Parent's fiscal quarter ending September 30, 2000;
(xvi) with respect to each Property identified on Schedule 4.1.,
each of the items referred to in Section 4.1. required to be delivered
in connection with any Borrowing Base Property;
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(xvii) the documents and instruments necessary to assign the
outstanding obligations and certain of the collateral under the
Existing Credit Agreement from the Existing Banks and Existing Agent to
the Lenders and Agent hereunder; and
(xviii) such other documents and instruments as the Agent, or any
Lender through the Agent, may reasonably request; and
(b) In the good faith judgment of the Agent:
(i) There shall not have occurred or become known to the Agent or
the Lenders any event, condition, situation or status since the date of
the information contained in the financial and business projections,
budgets, pro forma data and forecasts concerning the Parent, the
Borrower and the other Subsidiaries delivered to the Agent and the
Lenders prior to the Agreement Date that has had or could reasonably be
expected to have a Material Adverse Effect;
(ii) No litigation, action, suit, investigation or other arbitral,
administrative or judicial proceeding shall be pending or threatened
which could reasonably be expected to (A) have a Material Adverse
Effect or (B) restrain or enjoin, impose materially burdensome
conditions on, or otherwise materially and adversely affect the ability
of any Loan Party to fulfill its obligations under the Loan Documents
to which it is a party; and
(iii) The Parent, the Borrower and the other Loan Parties shall
have received all approvals, consents and waivers, and shall have made
or given all necessary filings and notices as shall be required to
consummate the transactions contemplated hereby without the occurrence
of any default under or violation of (A) any Applicable Law or (B) any
agreement, document or instrument to which any Loan Party is a party or
by which any of them or their respective properties is bound, except
for such approvals, consents, waivers, filings and notices the receipt,
making or giving of which, or the failure to make, give or receive
which, would not reasonably be likely to (1) have a Material Adverse
Effect, or (2) restrain or enjoin, impose materially burdensome
conditions on, or otherwise materially and adversely affect the ability
of the Borrower, the Parent or any other Loan Party to fulfill its
obligations under the Loan Documents to which it is a party.
Section 7.2. Conditions Precedent to All Loans and Letters of Credit.
The obligation of the Lenders to make any Loans, of the Swingline
Lender to make a Swingline Loan and of the Agent to issue Letters of Credit, are
all subject to the further condition precedent that: (a) no Default, or Event of
Default shall have occurred and be continuing as of the date of the making of
such Loan or date of issuance of such Letter of Credit or would exist
immediately after giving effect thereto, and none of the conditions described in
Section 2.8.(b) would exist after giving effect thereto; (b) the representations
and warranties made or deemed made by each Loan Party in the Loan Documents to
which any of them is a party, shall be true and correct on and as of the date of
the making of such Loan or date of issuance of such Letter of Credit with the
same force and effect as if made on and as of such date except to the extent
that such representations and warranties expressly relate solely to an earlier
date (in which case such representations and warranties shall have been true and
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accurate on and as of such earlier date) and except for changes in factual
circumstances not prohibited hereunder; (c) in the case of the borrowing of
Loans (other than Construction Advances), the Agent shall have received a timely
Notice of Borrowing or the Swingline Lender shall have received a timely Notice
of Swingline Borrowing, as applicable; and (d) as to Construction Advances under
any Construction Loan, the Agent shall have received a fully executed
Disbursement Request Form with all submissions required thereunder. Each Credit
Event shall constitute a certification by the Borrower to the effect set forth
in the preceding sentence (both as of the date of the giving of notice relating
to such Credit Event and, unless the Borrower otherwise notifies the Agent prior
to the date of such Credit Event, as of the date of the occurrence of such
Credit Event). In addition, the Borrower shall be deemed to have represented to
the Agent and the Lenders at the time any such Loan is made or any such Letter
of Credit is issued that all conditions to the making of such Loan or issuing of
such Letter of Credit contained in Article VII. have been satisfied or waived as
permitted hereunder.
Section 7.3. Conditions to Conversion to Term Loans.
The right of the Borrower to convert Revolving Loans into Term Loans
under Section 2.16. is subject to the condition precedent that the following
conditions be satisfied in the judgment of the Agent:
(a) timely receipt by the Agent of the notice from the Borrower
required under such Section;
(b) the fee due under Section 3.6.(d) shall have been paid to the
Agent;
(c) immediately before and after such conversion, no Event of Default
shall have occurred and be continuing; and
(d) the representations and warranties of the Borrower contained in the
Loan Documents to which it is a party shall be true in all material respects on
and as of the date of such conversion except to the extent such representations
or warranties specifically relate to an earlier date or such representations or
warranties become untrue by reason of events or conditions otherwise expressly
permitted under the Loan Documents.
The delivery of the notice required under such Section shall constitute a
certification by the Borrower to the Agent, the Lenders and the Swingline Lender
that the statements in the immediately preceding clauses (c) and (d) are true.
Section 7.4. Conditions as Covenants.
If the Lenders make any Loans, or the Agent issues a Letter of Credit,
prior to the satisfaction of all conditions precedent set forth in Sections 7.1.
and 7.2., the Borrower shall nevertheless cause such condition or conditions to
be satisfied within 5 Business Days after the date of the making of such Loans
or the issuance of such Letter of Credit, unless waived as permitted hereunder.
Unless set forth in writing to the contrary, the making of its initial Loan by a
Lender shall constitute a confirmation by such Lender to the Agent and the other
Lenders that insofar as such Lender is concerned the Borrower has satisfied the
conditions precedent for initial Loans set forth in Sections 7.1. and 7.2.
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ARTICLE VIII. REPRESENTATIONS AND WARRANTIES
Section 8.1. Representations and Warranties.
In order to induce the Agent, the Swingline Lender and each Lender to
enter into this Agreement and to make Loans and issue Letters of Credit, in the
case of the Agent, and to acquire participations in Letters of Credit and
Swingline Loans, in the case of the Lenders, the Borrower and the Parent each
represents and warrants to the Agent, the Swingline Lender and each Lender as
follows:
(a) Organization; Power; Qualification. Each of the Loan Parties is a
corporation, partnership or other legal entity, duly organized or formed,
validly existing and in good standing under the jurisdiction of its
incorporation or formation, has the power and authority to own or lease its
respective properties and to carry on its respective business as now being and
hereafter proposed to be conducted and is duly qualified and is in good standing
as a foreign corporation, partnership or other legal entity, and authorized to
do business, in each jurisdiction in which the character of its properties or
the nature of its business requires such qualification or authorization and
where the failure to be so qualified or authorized could reasonably be expected
to have, in each instance, a Material Adverse Effect.
(b) Ownership Structure. Part I of Schedule 8.1.(b) is a complete and
correct list, as of the Agreement Date, of all Subsidiaries of the Parent
(including the Borrower and all Subsidiaries of the Borrower) setting forth for
each such Subsidiary, (i) the jurisdiction of organization of such Subsidiary,
(ii) each Person holding any Equity Interest in such Subsidiary and (iii) the
nature of the Equity Interests held by each such Person; (iv) the percentage of
ownership of such Subsidiary represented by such Equity Interests and (v) a
short description of each Property, if any, owned in fee simple by such
Subsidiary. Except as disclosed in such Schedule (w) each of the Parent and its
Subsidiaries owns, free and clear of all Liens, and has the unencumbered right
to vote, all outstanding Equity Interests in each Person shown to be held by it
on such Schedule, (x) all of the issued and outstanding capital stock of each
such Person organized as a corporation is validly issued, fully paid and
nonassessable and (y) there are no outstanding subscriptions, options, warrants,
commitments, preemptive rights or agreements of any kind (including, without
limitation, any stockholders' or voting trust agreements) for the issuance,
sale, registration or voting of, or outstanding securities convertible into, any
additional shares of capital stock of any class, or partnership or other
ownership interests of any type in, any such Person. Part II of Schedule 8.1.(b)
correctly sets forth, as of the Agreement Date, all Unconsolidated Affiliates of
the Parent, including the correct legal name of such Person, the type of legal
entity which each such Person is, and all Equity Interests in such Person held
directly or indirectly by the Parent.
(c) Authorization of Loan Documents and Borrowings. The Borrower has
the right and power, and has taken all necessary action to authorize it, to
borrow hereunder. The Parent, the Borrower and each other Loan Party has the
right and power, and has taken all necessary action to authorize it, to execute,
deliver and perform each of the Loan Documents to which it is a party in
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accordance with their respective terms and to consummate the transactions
contemplated hereby and thereby. The Loan Documents to which the Parent, the
Borrower or any other Loan Party is a party have been duly executed and
delivered by the duly authorized officers of such Person and each is a legal,
valid and binding obligation of such Person enforceable against such Person in
accordance with its respective terms, except as the same may be limited by
bankruptcy, insolvency, fraudulent conveyance and other similar laws affecting
the rights of creditors generally and the availability of equitable remedies for
the enforcement of certain obligations (other than the payment of principal)
contained herein or therein may be limited by equitable principles generally.
(d) Compliance of Loan Documents and Borrowing with Laws, etc. The
execution, delivery and performance of this Agreement and the other Loan
Documents to which the Parent, the Borrower or any other Loan Party is a party
in accordance with their respective terms, and the borrowings hereunder, do not
and will not, by the passage of time, the giving of notice, or both: (i) require
any Governmental Approval or violate any Applicable Law (including all
Environmental Laws) relating to any Loan Party or any other Subsidiary; (ii)
result in a breach of or constitute a default under the declaration of trust,
certificate or articles of incorporation, bylaws, partnership agreement or other
organizational documents of any Loan Party or any other Subsidiary, or any
indenture, agreement or other instrument to which any Loan Party or any other
Subsidiary is a party or by which it or any of its respective properties may be
bound; or (iii) result in or require the creation or imposition of any Lien upon
or with respect to any property now owned or hereafter acquired by any Loan
Party or any other Subsidiary other than in favor of the Agent for the benefit
of the Lenders.
(e) Compliance with Law; Governmental Approvals. Each Loan Party and
each other Subsidiary is in compliance with each Governmental Approval
applicable to it and in compliance with all other Applicable Law relating to
such Loan Party or such other Subsidiary except for noncompliances which, and
Governmental Approvals the failure to possess could not reasonably be expected
to have a Material Adverse Effect.
(f) Title to Properties. Schedule 8.1.(f) is, as of the Agreement Date,
a complete and correct listing of all Properties of the Parent, the Borrower,
the other Loan Parties and all other Subsidiaries, setting forth, for each such
Property, the current occupancy status of such Property and whether such
Property is a Development Property or Major Redevelopment Property and, if such
Property is a Development Property or Major Redevelopment Property, the status
of completion of such Property. Each of the Parent, the Borrower, the other Loan
Parties and all other Subsidiaries has good, marketable and legal title to, or a
valid leasehold interest in, its respective assets necessary to the conduct of
their businesses. None of the Collateral is subject to any Lien other than
Permitted Liens and those Liens being released by the Existing Agent and
Existing Lenders under the Existing Credit Agreement substantially
contemporaneously with the Effective Date.
(g) Existing Indebtedness; Liabilities. Part I of Schedule 8.1.(g) is,
as of September 30, 2000, a complete and correct listing of all Indebtedness
(including all Guarantees of Indebtedness) of the Loan Parties and the other
Subsidiaries as at September 30, 2000, and if such Indebtedness is secured by
any Lien, a description of all of the property subject to such Lien. As of the
Agreement Date, the Loan Parties and the other Subsidiaries have performed and
are in compliance with all of the terms of such Indebtedness and all instruments
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and agreements relating thereto, and no default or event of default, or event or
condition which with the giving of notice, the lapse of time, or both, would
constitute such a default or event of default, exists with respect to any such
Indebtedness. Part II of Schedule 8.1.(g) is, as of September 30, 2000, a
complete and correct listing of all Total Liabilities of the Parent, the
Borrower, the other Loan Parties and the other Subsidiaries (excluding any
Indebtedness set forth on Part I of such Schedule but including Contingent
Obligations not set forth on Part I of such Schedule).
(h) Material Contracts. Schedule 8.1.(h) is, as of the Agreement Date,
a true, correct and complete listing of all Material Contracts. As of the
Agreement Date, all such Material Contracts are in full force and effect and
each Loan Party and the other Subsidiaries that are parties to any Material
Contract has performed and is in compliance with all of the terms of such
Material Contract, and no default or event of default, or event or condition
which with the giving of notice, the lapse of time, or both, would constitute
such a default or event of default, exists with respect to any such Material
Contract.
(i) Litigation. Except as set forth on Schedule 8.1.(i), there are no
actions, suits or proceedings pending (nor, to the knowledge of the Parent or
the Borrower, are there any actions, suits or proceedings threatened, nor is
there any basis therefor) against or in any other way relating adversely to or
affecting the Parent, the Borrower, any other Loan Party or any other Subsidiary
or any of its respective property in any court or before any arbitrator of any
kind or before or by any other Governmental Authority which could reasonably be
expected to have a Material Adverse Effect, and there are no strikes, slow
downs, work stoppages or walkouts or other labor disputes in progress or
threatened relating to any Loan Party or any other Subsidiary which could
reasonably be expected to have a Material Adverse Effect.
(j) Taxes. All federal, state and other tax returns of the Loan Parties
and the other Subsidiaries required by Applicable Law to be filed have been duly
filed, and all federal, state and other taxes, assessments and other
governmental charges or levies upon any Loan Party or any other Subsidiary and
its respective properties, income, profits and assets which are due and payable
have been paid, except any such nonpayment which is at the time permitted under
Section 9.7. As of the Agreement Date, except as set forth on Schedule 8.1.(j),
none of the United States income tax returns of any Loan Party or any other
Subsidiary are under audit. All charges, accruals and reserves on the books of
the Parent and each of its Subsidiaries in respect of any taxes or other
governmental charges are in accordance with GAAP.
(k) Financial Statements. The Parent has furnished to each Lender
copies of (i) the audited consolidated balance sheet of the Parent and its
consolidated Subsidiaries for the fiscal year ending December 31, 1999, and the
related consolidated statements of income, shareholders' equity and cash flows
for the fiscal year ending on such date, with the opinion thereon of Xxxxxx
Xxxxxxxx LLP and (ii) the unaudited consolidated balance sheet of the Parent and
its consolidated Subsidiaries for the fiscal quarter ending September 30, 2000,
and the related consolidated statements of income, shareholders' equity and cash
flows of the Parent and its consolidated Subsidiaries for the 3 fiscal quarter
period ending on such date. Such balance sheets and statements (including in
each case related schedules and notes) present fairly, in accordance with GAAP
consistently applied throughout the periods involved, and in all material
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respects, the consolidated financial position of the Parent and its consolidated
Subsidiaries as at their respective dates and the results of operations and the
cash flow for such periods (subject, as to interim statements, to changes
resulting from normal year-end audit adjustments). Neither the Parent nor any of
its Subsidiaries has on the Agreement Date any material contingent liabilities,
liabilities, liabilities for taxes, unusual or long-term commitments or
unrealized or forward anticipated losses from any unfavorable commitments,
except as referred to or reflected or provided for in said financial statements.
(l) No Material Adverse Change. Since December 31, 1999, there has been
no material adverse change in the consolidated financial condition, results of
operations, business or prospects of the Parent and its consolidated
Subsidiaries taken as a whole. Each of the Parent, the Borrower, the other Loan
Parties and the other Subsidiaries is Solvent.
(m) ERISA. No member of the ERISA Group maintains or has ever
maintained any Benefit Plan. No member of the ERISA Group contributes or is
obligated to contribute to or has ever contributed to or been obligated to
contribute to any Multiemployer Plan. No member of the ERISA Group has failed to
make any contribution or payment in respect of any Benefit Arrangement, or made
any amendment to any Benefit Arrangement, which has resulted or could result in
the imposition of a Lien or the posting of a bond or other security under ERISA
or the Internal Revenue Code.
(n) Absence of Defaults. No Loan Party nor any other Subsidiary is in
default under its declaration of trust, certificate or articles of
incorporation, bylaws, partnership agreement or other similar organizational
documents, and no event has occurred, which has not been remedied, cured or
waived: (i) which constitutes a Default or an Event of Default; or (ii) which
constitutes, or which with the passage of time, the giving of notice, or both,
would constitute, a default or event of default by any Loan Party or any other
Subsidiary under any agreement (excluding any Loan Document) or judgment, decree
or order to which any Loan Party or any other Subsidiary is a party or by which
any such Person or any of its respective properties may be bound where such
default or event of default could, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
(o) Environmental Laws. Each of the Loan Parties and the other
Subsidiaries is in compliance with all applicable Environmental Laws and has
obtained all Governmental Approvals which are required under Environmental Laws
and is in compliance with all terms and conditions of such Governmental
Approvals, where with respect to each of the foregoing the failure to obtain or
to comply with could be reasonably expected to have a Material Adverse Effect.
Except for any of the following matters that could not be reasonably expected to
have a Material Adverse Effect, neither the Parent nor the Borrower is aware of,
nor has either received notice of, any past or present events, conditions,
circumstances, activities, practices, incidents, actions, or plans which, with
respect to any Loan Party or any other Subsidiary, may unreasonably interfere
with or prevent compliance or continued compliance with Environmental Laws, or
may give rise to any common-law or legal liability, based on or related to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport, or handling or the emission, discharge, release or threatened release
into the environment, of any Hazardous Material; and there is no civil,
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criminal, or administrative action, suit, demand, claim, hearing, notice, or
demand letter, notice of violation, investigation, or proceeding pending or, to
the Parent's or the Borrower's knowledge after due inquiry, threatened, against
any Loan Party or any other Subsidiary relating in any way to Environmental Laws
which could be reasonably expected to have a Material Adverse Effect.
(p) Investment Company; Public Utility Holding Company. No Loan Party
nor any other Subsidiary is (i) an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, (ii) a "holding company" or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding company" or of
a "subsidiary company" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended, or (iii) subject to any other
Applicable Law which purports to regulate or restrict its ability to borrow
money or to consummate the transactions contemplated by this Agreement or to
perform its obligations under any Loan Document to which it is a party.
(q) Margin Stock. No Loan Party nor any other Subsidiary is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose, whether immediate, incidental or ultimate, of buying or
carrying "margin stock" within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System.
(r) Affiliate Transactions. Except as permitted by Section 10.7., no
Loan Party is a party to or bound by any agreement or arrangement (whether oral
or written) to which any Affiliate of the Borrower is a party.
(s) Intellectual Property. Each Loan Party and each other Subsidiary
owns or has the right to use, under valid license agreements or otherwise, all
material patents, licenses, franchises, trademarks, trademark rights, trade
names, trade name rights, trade secrets and copyrights (collectively,
"Intellectual Property") necessary to the conduct of the businesses of the
Borrower and its Subsidiaries, taken as a whole, as now conducted and as
contemplated by the Loan Documents, without known conflict with any patent,
license, franchise, trademark, trade secret, trade name, copyright, or other
proprietary right of any other Person. All such Intellectual Property is fully
protected and/or duly and properly registered, filed or issued in the
appropriate office and jurisdictions for such registrations, filing or
issuances. No material claim has been asserted by any Person with respect to the
use of any such Intellectual Property, or challenging or questioning the
validity or effectiveness of any such Intellectual Property. The use of such
Intellectual Property by the Loan Parties and the other Subsidiaries does not
infringe on the rights of any Person, subject to such claims and infringements
as do not, in the aggregate, give rise to any liabilities on the part of any
Loan Party or any other Subsidiary that could reasonably be expected to have a
Material Adverse Effect.
(t) Business. As of the Agreement Date, the Parent, the Borrower, the
other Loan Parties and the other Subsidiaries are engaged in the business of
acquiring, developing, owning, operating and managing commercial real estate,
including, retail, multi-family and industrial properties, together with related
business activities and investments incidental thereto.
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(u) Accuracy and Completeness of Information. All written information,
reports and other papers and data (excluding financial projections or other
forward looking statements) furnished to the Agent or any Lender by, or at the
direction of, the Parent, the Borrower, any other Loan Party or any other
Subsidiary were, at the time the same were so furnished, to the best of the
Parent's and the Borrower's knowledge, complete and correct in all material
respects, to the extent necessary to give the recipient a true and accurate
knowledge of the subject matter, or, in the case of financial statements,
present fairly, in accordance with GAAP consistently applied throughout the
periods involved, the financial position of the Persons involved as at the date
thereof and the results of operations for such periods. All financial
projections and other forward looking statements prepared by or on behalf of the
Parent, the Borrower or any other Loan Party or Subsidiary that have been or may
hereafter be made available to the Agent or any Lender were or will be prepared
in good faith based on reasonable assumptions. No document furnished or written
statement made, in each case by, or at the direction of any Loan Party or any
other Subsidiary to the Agent or any Lender in connection with the negotiation,
preparation or execution of any Loan Document contains or will contain any
untrue statement of a fact material to the creditworthiness of any Loan Party or
any other Subsidiary or omits or will omit to state a fact material to the
creditworthiness of any Loan Party or any other Subsidiary which is necessary in
order to make the statements contained therein not misleading.
(w) Not Plan Assets. None of the assets of any Loan Party or any other
Subsidiary constitutes "plan assets" within the meaning of ERISA, the Internal
Revenue Code and the respective regulations promulgated thereunder, of any ERISA
Benefit Plan. The execution, delivery and performance of the Loan Documents by
the Loan Parties, and the borrowing and repayment of amounts thereunder, do not
and will not constitute "prohibited transactions" under ERISA or the Internal
Revenue Code for which no statutory or administrative exemption is available.
(x) Collateral. Each Property included in calculations of the Borrowing
Base satisfies all requirements under the Loan Documents for being a Borrowing
Base Property.
(y) Non-Guarantor Entities. Schedule 8.1.(y) is, as of the Agreement
Date, a complete and correct list of all Non-Guarantor Entities, setting forth
for each such Person, the correct legal name of such Person, the type of legal
entity which each such Person is, and all equity interests in such Person held
directly or indirectly by the Parent. No Non-Guarantor Entity satisfies any
condition contained in clauses (i) or (ii) of Section 9.15.(a) or clause (i) of
Section 9.16.(a).
Section 8.2. Survival of Representations and Warranties, Etc.
All statements contained in any certificate, financial statement or
other instrument delivered by, or at the direction of, any Loan Party or any
other Subsidiary to the Agent or any Lender (other than the content of any
projections or other similar forward looking statements) pursuant to or in
connection with this Agreement or any of the other Loan Documents (including,
but not limited to, any such statement made in or in connection with any
amendment thereto or any statement contained in any certificate, financial
statement or other instrument delivered by, or at the direction of, the Parent
or the Borrower prior to the Agreement Date and delivered to the Agent or any
Lender in connection with closing the transactions contemplated hereby) shall
constitute representations and warranties made by the Parent and the Borrower
under this Agreement. All representations and warranties made under this
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Agreement and the other Loan Documents shall be deemed to be made at and as of
the Agreement Date, the Effective Date and at and as of the date of the
occurrence of any Credit Event, except to the extent that such representations
and warranties expressly relate solely to an earlier date (in which case such
representations and warranties shall have been true and accurate on and as of
such earlier date) and except for changes in factual circumstances specifically
permitted hereunder. All such representations and warranties shall survive the
effectiveness of this Agreement, the execution and delivery of the Loan
Documents and the making of the Loans and the issuance of the Letters of Credit.
ARTICLE IX. AFFIRMATIVE COVENANTS
For so long as this Agreement is in effect, unless the Requisite
Lenders (or, if required pursuant to Section 13.6., all of the Lenders) shall
otherwise consent in the manner provided for in Section 13.6., the Borrower and
the Parent, as applicable, shall comply with the following covenants:
Section 9.1. Financial Reporting and Other Information
The Parent shall furnish to the Agent each of the following:
(a) Quarterly Financial Statements. As soon as available and in any
event within 45 days after the close of each of the first, second and third
fiscal quarters of the Parent, the consolidated balance sheet of the Parent and
its Subsidiaries as at the end of such period and the related consolidated
statements of income and cash flows of the Parent and its Subsidiaries for such
period, and setting forth in each case in comparative form the figures for the
corresponding periods of the previous fiscal year, all of which shall be
accompanied by a statement signed by the chief financial officer of the Parent
on behalf of the Parent stating that, in his or her opinion, such statements
present fairly, in accordance with GAAP and in all material respects, the
consolidated financial position of the Parent and its Subsidiaries as at the
date thereof and the results of operations for such period (subject to normal
year-end audit adjustments).
(b) Year-End Statements. As soon as available and in any event within
120 days after the end of each fiscal year of the Parent, the audited
consolidated balance sheet of the Parent and its Subsidiaries as at the end of
such fiscal year and the related audited consolidated statements of income and
cash flows of the Parent and its Subsidiaries for such fiscal year, setting
forth in comparative form the figures as at the end of and for the previous
fiscal year, all of which shall be (a) accompanied by a statement signed by the
chief financial officer of the Parent on behalf of the Parent stating that, in
his or her opinion, such statements present fairly, in accordance with GAAP and
in all material respects, the financial position of the Parent and its
Subsidiaries as at the date thereof and the result of operations for such period
and (b) certified by Xxxxxx Xxxxxxxx LLP or any other independent certified
public accountants of recognized national standing acceptable to the Agent and
the Requisite Lenders, whose opinion shall be unqualified and in scope and
substance satisfactory to the Agent and the Requisite Lenders and who shall have
authorized the Parent to deliver such financial statements and certification
thereof to the Agent and the Lenders pursuant to this Agreement.
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(c) Compliance Certificate. At the time the financial statements are
furnished pursuant to the immediately preceding subsections (a) and (b), a
certificate substantially in the form of Exhibit E (a "Compliance Certificate")
executed on behalf of the Parent by the chief financial officer of the Parent
(i) setting forth as of the end of such quarterly accounting period or fiscal
year, as the case may be, the calculations required to establish whether or not
the Parent and the Borrower, as applicable, were in compliance with the
covenants contained in Section 10.1.; and (ii) stating that no Default or Event
of Default exists, or, if such is not the case, specifying such Default or Event
of Default and its nature, when it occurred and, whether it is continuing and
the steps being taken by the Parent or the Borrower with respect to such event,
condition or failure.
(d) Reports from Accountants. Upon the request of the Agent, copies of
all reports, if any, submitted to the Parent or its Board of Trustees by its
independent public accountants including, without limitation, any management
report.
(e) Shareholder Information. Promptly upon the mailing thereof to the
shareholders of the Parent generally, copies of all financial statements,
reports, proxy statements and other written information so mailed and promptly
upon the issuance thereof copies of all press releases issued by the Parent, the
Borrower, any Subsidiary or any other Loan Party.
(f) Securities Filings. Within 10 Business Days of the filing thereof,
copies of all registration statements (excluding the exhibits thereto and any
registration statements on Form S-8 or its equivalent), reports on Forms 10-K,
10-Q and 8-K (or their equivalents) and all other periodic reports which the
Parent, any other Loan Party or any other Subsidiary shall file with the
Securities and Exchange Commission (or any Governmental Authority substituted
therefor) or any national securities exchange.
(g) Borrowing Base Certificate. At the time the financial statements
are furnished pursuant to subsections (a) and (b) above, a Borrowing Base
Certificate substantially in the form of Exhibit H setting forth the information
to be contained therein, including without limitation, a calculation of the
Permanent Loan Estimate of each Borrowing Base Property, as of the last day of
such fiscal quarter; provided, however; that the calculation of the Permanent
Loan Estimate of each Borrowing Base Property set forth in the Borrowing Base
Certificates delivered for the second and fourth fiscal quarters shall be for
informational purposes only and, as provided in Section 4.3. shall not result in
a change to the Borrowing Base Value of any Borrowing Base Property or the
Borrowing Base at such time.
(h) Pricing Certificate. At the time the financial statements are
furnished pursuant to subsections (a) and (b) above, a certificate substantially
in the form of Exhibit V (a "Pricing Certificate") executed by the chief
financial officer of the Parent (i) setting forth as of the end of such
quarterly accounting period or fiscal year, as the case may be, the calculations
required to establish the ratio of Total Liabilities to Gross Asset Value (as
determined in accordance with Section 10.1.) and (ii) stating the corresponding
level of Applicable Margin with respect to such ratio.
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(i) Operating Summaries. At the time the financial statements are
furnished pursuant to the preceding subsections (a) and (b) above, an operating
summary with respect to each Property then included in calculations of the
Borrowing Base, including without limitation, a quarterly and year-to-date
statement of Net Operating Income and a leasing/occupancy status report together
with a current rent roll for such Property and at the time the financial
statements are furnished pursuant to the preceding subsection (b) above, an
operating summary with respect to each Property, including without limitation, a
quarterly and year-to-date statement of Net Operating Income and a
leasing/occupancy status report together with a current rent roll for such
Property.
(j) Annual Budget and Plans of the Parent. No later than 20 days before
the end of each fiscal year of the Parent ending after December 31, 2000 and
prior to the Termination Date, projected balance sheets, operating statements
and cash flow budgets of the Parent and its Subsidiaries on a consolidated basis
for each quarter of the next succeeding fiscal year, all itemized in reasonable
detail. The foregoing shall be accompanied by pro forma calculations, together
with detailed assumptions, required to establish whether or not the Parent, and
when appropriate its consolidated Subsidiaries, will be in compliance with the
covenants contained in Section 10.1. and at the end of each fiscal quarter of
the next succeeding fiscal year.
(k) Annual Property Budgets. No later than 20 days before the end of
each fiscal year of the Parent ending prior to the Termination Date, a property
budget for each Borrowing Base Property for the coming fiscal year of the
Parent, together with applicable investment memorandums.
(l) Report on Sources and Uses of Funds. Within 20 Business Days of the
Agent's request therefor, a report in form and substance reasonably satisfactory
to the Agent detailing the Parent's, together with its Subsidiaries', projected
sources and uses of cash for the period of four consecutive fiscal quarters
immediately following the date of the Agent's request. Such sources shall
include but not be limited to excess operating cash flow, availability under
this Agreement, unused availability under committed development loans, unfunded
committed equity and any other committed sources of funds. Such uses shall
include but not be limited to cash obligations for binding acquisitions,
unfunded development costs, capital expenditures, debt service, overhead,
dividends, maturing project loans, hedge settlements and other anticipated uses
of cash.
(m) Ownership Share/Recourse Share Calculations. Promptly upon the
request of the Agent, evidence of the Parent's calculation of the Ownership
Share and Recourse Share with respect to a Subsidiary or an Unconsolidated
Affiliate, such evidence to be in form and detail reasonably satisfactory to the
Agent.
(n) ERISA Notices. If and when any member of the ERISA Group (i) gives
notice to the PBGC of any "reportable event" (as defined in Section 4043 of
ERISA) with respect to any Benefit Plan which might constitute grounds for a
termination of such Benefit Plan under Title IV of ERISA, or knows that the plan
administrator of any Benefit Plan has given notice of any such reportable event,
a copy of the notice of such reportable event given to the PBGC; (ii) receives
notice of complete or partial withdrawal liability under Title IV of ERISA or
notice that any Multiemployer Plan is in reorganization, is insolvent or has
been terminated, a copy of such notice; (iii) receives notice from the PBGC
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under Title IV of ERISA of an intent to terminate, impose liability (other than
for premiums under Section 4007 of ERISA) in respect of, or appoint a trustee to
administer any Benefit Plan, a copy of such notice; (iv) applies for a waiver of
the minimum funding standard under Section 412 of the Internal Revenue Code, a
copy of such application; (v) gives notice of intent to terminate any Benefit
Plan under Section 4041(c) of ERISA, a copy of such notice and other information
filed with the PBGC; (vi) gives notice of withdrawal from any Benefit Plan
pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails to make
any payment or contribution to any Benefit Plan or Multiemployer Plan or in
respect of any Benefit Arrangement or makes any amendment to any Benefit Plan or
Benefit Arrangement which has resulted or could result in the imposition of a
Lien or the posting of a bond or other security under ERISA or the Internal
Revenue Code, a certificate of the controller of the Borrower setting forth
details as to such occurrence and action, if any, which the Borrower or
applicable member of the ERISA Group is required or proposes to take.
(o) Litigation and Governmental Proceedings. To the extent the Parent
or the Borrower is aware of the same, prompt notice of the commencement of any
proceeding or investigation by or before any Governmental Authority and any
action or proceeding in any court or other tribunal or before any arbitrator
against or in any other way relating adversely to, or adversely affecting, the
Parent, the Borrower, any other Loan Party or any other Subsidiary or any of
their respective properties, assets or businesses which, if determined or
resolved adversely to such Person, could reasonably be expected to have a
Material Adverse Effect, and prompt notice of the receipt of notice that any
United States income tax returns of the Parent, the Borrower or any of its
Subsidiaries are being audited.
(p) Modification of Organizational Documents. At least five (5)
Business Days prior to the effectiveness thereof, a copy of any amendment or
other modification to the Trust Agreement, the Partnership Agreement,
certificate or articles of incorporation, bylaws, partnership agreement or other
similar organizational documents of the Parent, the Borrower or any other Loan
Party owning a Borrowing Base Property or a Construction Property.
(q) Material Adverse Change. Prompt notice of any change in the
business, assets, liabilities, financial condition, results of operations of the
Parent, the Borrower, any Subsidiary or any other Loan Party which has had or
could reasonably be expected to have Material Adverse Effect.
(r) Default. Prompt notice of the occurrence of (i) any Default, or
(ii) Event of Default, or (iii) the occurrence of any event which constitutes or
which with the passage of time, the giving of notice, or otherwise, would
constitute an event of default by the Parent, the Borrower, any other Loan Party
or any other Subsidiary under any Material Contract to which any such Person is
a party or by which any such Person or any of its respective properties may be
bound.
(s) Material Contracts. Promptly upon entering into any Material
Contract after the Agreement Date, a copy of such Material Contract to the
Agent.
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(t) Change in Ownership of the Parent. Prompt notice of any approval
given by the board of trustees of the Parent to any "person" or "group" (as such
terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")) with respect to such "person" or "group"
becoming the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act, except that a Person will be deemed to have "beneficial ownership"
of all securities that such Person has the right to acquire, whether such right
is exercisable immediately or only after the passage of time), directly or
indirectly, of more than 9.9% of the total voting power of the then outstanding
voting stock of the Parent.
(u) Other Information, Etc. From time to time and promptly upon each
request, such data, certificates, reports, statements, opinions of counsel,
documents or further information regarding the business, assets, liabilities,
financial condition, results of operations of the Parent, the Borrower, any
other Loan Party or any other Subsidiary as the Agent (or any Lender through the
Agent) may reasonably request.
Upon receipt of any of the items referred to above (other than items
requested under the immediately preceding subsection (u)), the Agent shall
promptly forward a copy thereof to each Lender at its Lending Office. Upon
receipt of any item requested by a Lender under the immediately preceding
subsection (u), the Agent shall promptly forward a copy thereof to such Lender
at its Lending Office.
Section 9.2. Preservation of Existence and Similar Matters.
Except as otherwise permitted under Section 10.4., the Borrower and the
Parent shall preserve and maintain, and cause each Subsidiary to preserve and
maintain, its respective existence, rights, franchises, licenses and privileges
in the jurisdiction of its incorporation or formation and qualify and remain
qualified and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such
qualification and authorization and where the failure to be so authorized and
qualified could reasonably be expected to have a Material Adverse Effect.
Section 9.3. Compliance with Applicable Law.
The Borrower and the Parent shall comply, and cause each Subsidiary to
comply, with all Applicable Law, including the obtaining of all Governmental
Approvals, the failure with which to comply could reasonably be expected to have
a Material Adverse Effect.
Section 9.4. Maintenance of Property.
In addition to the requirements of any of the other Loan Documents, the
Borrower and the Parent shall (a) protect and preserve, and cause each
Subsidiary to protect and preserve, all of its properties, including, but not
limited to, all Intellectual Property, and maintain in good repair, working
order and condition all tangible properties, ordinary wear and tear and casualty
excepted, and (b) from time to time make or cause to be made all needed and
appropriate repairs, renewals, replacements and additions to such properties, so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times except where the failure to do any of the
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foregoing under clauses (a) and (b) herein could not reasonably be expected to
have a Material Adverse Effect.
Section 9.5. Conduct of Business.
The Parent and the Borrower shall at all times carry on, and, except as
permitted under Section 10.4., cause each of their Subsidiaries to carry on, its
respective businesses as described in Section 8.1.(t).
Section 9.6. Insurance.
The Borrower and the Parent shall maintain, and cause each Loan Party
to maintain, insurance with financially sound and reputable insurance companies
against such risks and in such amounts as is customarily maintained by similar
businesses or as may be required by Applicable Law. The Borrower and the Parent
shall from time to time deliver to the Agent upon request a detailed list,
together with copies of all policies of the insurance then in effect, stating
the names of the insurance companies, the amounts and rates of the insurance,
the dates of the expiration thereof and the properties and risks covered
thereby. Such insurance shall, in any event, include the following:
(a) Insurance against loss to such Properties on an "all risk" policy
form, covering insurance risks no less broad than those covered under a Standard
Multi Peril (SMP) policy form, which contains a Commercial ISO "Causes of
Loss-Special Form," in the then current form, and such other risks as Agent may
reasonably require, in amounts equal to the full replacement cost of the
Properties including fixtures and equipment, Borrower's interest in leasehold
improvements, and the cost of debris removal, with an agreed amount endorsement,
and with deductibles of not more than $50,000, except that any deductibles for
any insurance covering damage by windstorm may be in amounts up to five percent
(5%) of the value of the Property insured;
(b) For Borrowing Base Properties and Construction Properties (if such
Construction Property is tenant occupied), rent and rental expense insurance for
such Properties and in amounts sufficient to pay during any period in which each
such Property may be damaged or destroyed, for a period of twelve (12) months;
(i) at least 100% of all rents and (ii) all amounts (including, but not limited
to, all taxes, assessments, utility charges and insurance premiums) required to
be paid by tenants of each such Property;
(c) Broad form boiler and machinery insurance including business
interruption/extra expense and rent and rental value insurance, on all equipment
and objects customarily covered by such insurance and/or involved in the
heating, cooling, electrical and mechanical systems of the Properties (if any
are located at the Properties), but excluding individual HVAC equipment that
serves only one residential apartment unit, provided for full repair and
replacement cost coverage, and other insurance of the types and in amounts as
Agent may reasonably require, but in no event less than that customarily carried
by persons owning or operating like properties;
(d) During the making of any alterations or improvements to a Property,
carry or cause to be carried (i) insurance covering claims based on the owner's
or employer's contingent liability not covered by the insurance provided in
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subsection (e) below, (ii) workers' compensation insurance covering all persons
engaged in such alterations or improvements, and (iii) builder's completed value
risk insurance against "all risks of physical loss" for construction projects of
$1,000,000 or more;
(e) Insurance against loss or damage by flood or mud slide in
compliance with the Flood Disaster Protection Act of 1973, as amended from time
to time, if the Properties are now, or at any time while the Obligations or any
portion thereof remains unpaid shall be, situated in any area which an
appropriate governmental authority designates as a special flood hazard area, in
amounts equal to the full replacement value of all above grade structures on the
Properties, or as such lesser amounts as may be available under Federal flood
insurance programs;
(f) Commercial general public liability insurance, with the location of
the Properties designated thereon, against death, bodily injury and property
damage arising on, about or in connection with the Properties, with Borrower or
the applicable Subsidiary listed as the named insured, with such limits as
Borrower or the applicable Subsidiary may reasonably require (but in no event
less than $1,000,000 and written on a then current Standard "ISO" occurrence
basis form or equivalent form), excess umbrella liability coverage with such
limits as Borrower or the applicable Subsidiary may reasonably require but in no
event less than $5,000,000; and
(g) Such other insurance relating to the Properties and the uses and
operation thereof as Agent may, from time to time, reasonably require.
Section 9.7. Payment of Taxes and Claims.
The Borrower and the Parent shall pay or discharge, and cause each
Subsidiary to pay and discharge, when due (a) all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits or
upon any properties belonging to it, and (b) all lawful claims of materialmen,
mechanics, carriers, warehousemen and landlords for labor, materials, supplies
and rentals which, if unpaid, might become a Lien on any properties of such
Person, except in each case, any such non-payment or failure to discharge which
could not reasonably be expected to have a Material Adverse Effect; provided,
however, that this Section shall not require the payment or discharge of any
such tax, assessment, charge, levy or claim which is being contested in good
faith by appropriate proceedings which operate to suspend the collection thereof
and for which adequate reserves have been established on the books of the
Borrower, the Parent or such Subsidiary, as applicable, in accordance with GAAP.
Section 9.8. Books and Records; Visits and Inspections.
The Borrower and the Parent will keep, and will cause each Subsidiary
to keep, proper books of record and account in which full, true and correct
entries shall be made of all dealings and transactions in relation to its
business and activities. In addition to rights of the Agent and Lenders set
forth in Section 5.3.herein, the Borrower and the Parent will permit, and will
cause each Subsidiary to permit, representatives of the Agent or any Lender to
visit and inspect any of their respective properties, to examine and make
abstracts from any of their respective books and records and to discuss their
respective affairs, finances and accounts with their respective officers,
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employees and independent public accountants in the Borrower's presence prior to
an Event of Default, all at such reasonable times during business hours and as
often as may reasonably be desired and so long as no Event of Default shall have
occurred and be continuing, with reasonable notice and, at any time after the
occurrence and during the continuance of a Default or Event of Default, all at
the Borrower's expense.
Section 9.9. Use of Proceeds; Letters of Credit.
(a) Revolving Loans, Swingline Loans and Letters of Credit. The
Borrower will only use the proceeds of Revolving Loans and Swingline Loans (i)
for the payment of pre-development and development costs incurred in connection
with Properties; (ii) to finance acquisitions and the general working capital
needs of the Parent, the Borrower and the Borrower's Subsidiaries; (iii) to
finance the repayment of Indebtedness of the Parent, the Borrower and the
Borrower's Subsidiaries; and (iv) for other general corporate purposes of the
Parent, the Borrower and the Borrower's Subsidiaries. The Borrower shall only
use Letters of Credit for the same purposes for which it may use the proceeds of
Revolving Loans and Swingline Loans.
(b) Construction Advances. The Borrower will only use the proceeds of
Construction Advances to finance acquisition costs, pre-development and
development costs incurred in connection with Construction Properties, in each
case, as set forth in the Cost Breakdown for the applicable Construction
Property.
(c) Margin Stock. The Borrower and the Parent shall not, and shall not
permit any Subsidiary, to use any part of the proceeds of any Loan or Letters of
Credit to purchase or carry, or to reduce or retire or refinance any credit
incurred to purchase or carry, any margin stock (within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System) or to
extend credit to others for the purpose of purchasing or carrying any such
margin stock.
Section 9.10. Environmental Matters.
The Borrower and the Parent shall comply, and cause all of its
Subsidiaries to comply, with all Environmental Laws the failure to comply with
which could reasonably be expected to have a Material Adverse Effect. If the
Borrower, the Parent or any Subsidiary shall (a) receive notice that any
violation of any Environmental Law may have been committed or is about to be
committed by such Person, (b) receive notice that any administrative or judicial
complaint or order has been filed or is about to be filed against the Borrower,
any Subsidiary or any other Loan Party alleging violations of any Environmental
Law or requiring the Borrower, or Subsidiary or any other Loan Party to take any
action in connection with the release of Hazardous Materials or (c) receive any
notice from a Governmental Authority or private party alleging that the
Borrower, or Subsidiary or any other Loan Party may be liable or responsible for
costs associated with a response to or cleanup of a release of a Hazardous
Materials or any damages caused thereby, the Borrower shall provide the Agent
with a copy of such notice within 10 days after the receipt thereof by the
Borrower or any of the Subsidiaries. The Borrower, the Parent and the
Subsidiaries shall promptly take all actions necessary to prevent the imposition
of any Liens on any of their respective properties arising out of or related to
any Environmental Laws.
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Section 9.11. Further Assurances.
At the Borrower's cost and expense, upon request of the Agent, the
Borrower shall duly execute and deliver or cause to be duly executed and
delivered, to the Agent such further instruments, documents and certificates,
and do and cause to be done such further acts that may be reasonably necessary
or advisable in the reasonable opinion of the Agent to carry out more
effectively the provisions and purposes of this Agreement and the other Loan
Documents.
Section 9.12. Material Contracts.
The Borrower and the Parent shall, and shall cause each Subsidiary to,
duly and punctually perform and comply with any and all material
representations, warranties, covenants and agreements expressed as binding upon
the Borrower, the Parent or such Subsidiary under any Material Contract except
that the Borrower, the Parent or any Subsidiary may terminate any Property
Management Agreement between such Person and PREIT-Xxxxx, Inc. ("PREIT-Xxxxx")
at any time after PREIT-Xxxxx becomes a "taxable REIT subsidiary" as defined in
Section 856(e) of the Internal Revenue Code. Except for the termination
permitted in the immediately preceding sentence, neither the Borrower nor the
Parent shall, nor shall the Borrower permit any Subsidiary, to do or knowingly
permit to be done anything to impair materially the value of any of the Material
Contracts.
Section 9.13. REIT Status.
The Parent shall at all times maintain its status as a REIT.
Section 9.14. Exchange Listing.
The Parent shall maintain at least one class of common shares of the
Parent having trading privileges on the New York Stock Exchange or the American
Stock Exchange or which is subject to price quotations on The NASDAQ Stock
Market's National Market System.
Section 9.15. Guarantors.
(a) Generally. The Parent shall cause any Subsidiary or Approved Joint
Venture, as applicable that is not already a Guarantor and to which any of the
following conditions apply (each a "New Guarantor"), to execute and deliver to
the Agent an Accession Agreement to the Guaranty, together with the other items
required to be delivered under the immediately following subsection (b):
(i) such Subsidiary Guarantees, or otherwise becomes obligated in
respect of, any Indebtedness of any other Person (other than
Indebtedness under Guarantees which are solely Guarantees of
performance and not of payment and other Guarantees of such Person for
liabilities arising from reasonable and customary exceptions to
Nonrecourse Indebtedness, such as for fraud, willful misrepresentation,
misapplication of funds (including misappropriation of security
deposits and failure to apply rents to operating expenses or debt
service), indemnities relating to environmental matters and waste of
property constituting security for such Nonrecourse Indebtedness,
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post-default interest, attorney's fees and other costs of collection to
the extent not covered by the value of the property constituting
security for such Nonrecourse Indebtedness and other similar exceptions
to recourse liability); or
(ii) such Subsidiary or Approved Joint Venture owns a Borrowing
Base Property; or
(iii) such Subsidiary is formed or otherwise acquired after the
Agreement Date and can become a party to the Guaranty without
violating: (A) terms of its articles of incorporation, bylaws,
operating agreement, partnership agreement, declaration of trust,
shareholders agreement, member agreement or other similar
organizational document, which terms expressly prohibit such Subsidiary
from providing Guarantees of Indebtedness of any other Person, (B) any
fiduciary obligation owing to the holders of an equity interest in such
Subsidiary and imposed under Applicable Law or (C) the terms of any
documents evidencing Indebtedness of such Subsidiary.
Any such Accession Agreement and the other items required under such subsection
(b) must be delivered to the Agent no later than 45 days following on the last
day of the Parent's fiscal quarter during which any of the above conditions
first applies to a Subsidiary. Notwithstanding the foregoing, if the assets of a
Subsidiary consist solely of Equity Interests in another Subsidiary and such
other Subsidiary is not required to become a Guarantor under the terms of this
Section, then such Subsidiary shall not be required to become a Guarantor under
the terms of this Section.
(b) Required Deliveries. Each Accession Agreement delivered by a New
Guarantor under the immediately preceding subsections (a) shall be accompanied
by (i) the items that would have been delivered under Sections 7.1.(a)(iv), (v),
(x) through (xiii) and (xvi) if such New Guarantor had been a Guarantor on the
Agreement Date; (ii) if such New Guarantor is not a Wholly Owned Subsidiary, a
written acknowledgement of all Persons (other than Loan Parties) holding Equity
Interests in such New Guarantor, pursuant to which such Persons acknowledge and
consent to the Guaranty made by such New Guarantor and (iii) such other
documents and instruments as the Agent may reasonably request.
(c) Release of Certain Guarantors. The Borrower may request in writing
that the Agent release a Guarantor that became a party to the Guaranty pursuant
to subsection (a) above or Section 7.1., other than the Parent, if such
Guarantor (i) will be, upon the release of the Guaranty, incurring Indebtedness
secured by a Lien on its Properties and the documents evidencing such
Indebtedness specifically prohibit such Guaranty, (ii) such Guarantor will be,
upon the release of the Guaranty, selling, conveying, transferring or otherwise
disposing of all or a substantial part of its business or assets, (iii) if such
Guarantor is a Subsidiary or Approved Joint Venture, the Borrowing Base Property
owned by such Guarantor is being released pursuant to Section 4.1.(g) hereof and
such Guarantor owns no other Borrowing Base Property or (iv) the provisions of
the immediately preceding subsections (a)(i) or (a)(iii) no longer apply, and
upon receipt of such request the Agent shall release such Guarantor from the
Guaranty so long as: (I) such Guarantor is not otherwise required to be a party
to the Guaranty under this Section; and (II) no Event of Default shall then be
in existence or would occur as a result of such release.
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Section 9.16. Construction Guarantors.
(a) Generally. The Parent shall cause any Subsidiary that is not
already a Construction Guarantor and to which any of the following conditions
apply (each a "New Construction Guarantor"), to execute and deliver to the Agent
an Accession Agreement to each of the Construction Guaranties, together with the
other items required to be delivered under the immediately following subsection
(b):
(i) such Subsidiary Guarantees, or otherwise becomes obligated in
respect of, any Indebtedness of any other Person (other than
Indebtedness under Guarantees which are solely Guarantees of
performance and not of payment and other Guarantees of such Person for
liabilities arising from reasonable and customary exceptions to
Nonrecourse Indebtedness, such as for fraud, willful misrepresentation,
misapplication of funds (including misappropriation of security
deposits and failure to apply rents to operating expenses or debt
service), indemnities relating to environmental matters and waste of
property constituting security for such Nonrecourse Indebtedness,
post-default interest, attorney's fees and other costs of collection to
the extent not covered by the value of the property constituting
security for such Nonrecourse Indebtedness and other similar exceptions
to recourse liability); or
(ii) such Subsidiary is formed or otherwise acquired after the
Agreement Date and can become a party to the Construction Guaranties
without violating: (A) terms of its articles of incorporation, bylaws,
operating agreement, partnership agreement, declaration of trust,
shareholders agreement, member agreement or other similar
organizational document, which terms expressly prohibit such Subsidiary
from providing Guarantees of Indebtedness of any other Person; (B) any
fiduciary obligation owing to the holders of an equity interest in such
Subsidiary and imposed under Applicable Law or (C) the terms of any
documents evidencing Indebtedness of such Subsidiary.
Any such Accession Agreement and the other items required under such subsection
(b) must be delivered to the Agent no later than 45 days following on the last
day of the Parent's fiscal quarter during which any of the above conditions
first applies to a Subsidiary. Notwithstanding the foregoing, if the assets of a
Subsidiary consist solely of Equity Interests in another Subsidiary and such
other Subsidiary is not required to become a Guarantor under the terms of this
Section, then such Subsidiary shall not be required to become a Guarantor under
the terms of this Section.
(b) Required Deliveries. Each Accession Agreement delivered by a New
Construction Guarantor under the immediately preceding subsections (a) shall be
accompanied by (i) the items that would have been delivered under Sections
7.1.(a)(iv), (v), (x) through (xiii) and (xvi) if such New Construction
Guarantor had been a Guarantor on the Agreement Date; (ii) if such New
Construction Guarantor is not a Wholly Owned Subsidiary, a written
acknowledgement of all Persons (other than Loan Parties) holding Equity
Interests in such New Construction Guarantor, pursuant to which such Persons
acknowledge and consent to the Construction Guaranties made by such New
Construction Guarantor and (iii) such other documents and instruments as the
Agent may reasonably request.
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(c) Release of Certain Construction Guarantors. The Borrower may
request in writing that the Agent release a Construction Guarantor that became a
party to the Construction Guaranties pursuant to subsection (a) above or Section
5.1. other than the Parent and the Borrower if such Construction Guarantor (i)
will be, upon the release of such Construction Guaranties, incurring
Indebtedness secured by a Lien on its Properties and the documents evidencing
such Indebtedness specifically prohibit such Construction Guaranties, (ii) such
Construction Guarantor will be, upon the release of such Construction
Guaranties, selling, conveying, transferring or otherwise disposing of all or a
substantial part of its business or assets or (iii) the provisions of
subsections (a)(i) or (a)(ii) hereof no longer apply, and upon receipt of such
request the Agent shall release such Construction Guarantor from such
Construction Guaranties so long as: (I) such Construction Guarantor is not
otherwise required to be a party to such Construction Guaranties under this
Section; and (II) no Event of Default shall then be in existence or would occur
as a result of such release.
ARTICLE X. NEGATIVE COVENANTS
For so long as this Agreement is in effect, unless the Requisite
Lenders (or, if required pursuant to Section 13.6., all of the Lenders) shall
otherwise consent in the manner set forth in Section 13.6., the Borrower and the
Parent, as applicable, shall comply with the following covenants:
Section 10.1. Financial Covenants.
(a) Minimum Tangible Net Worth. The Parent shall not permit its
Tangible Net Worth determined on a consolidated basis at the end of any fiscal
quarter to be less than (i) $228,835,000 plus (ii) 75% of the Net Proceeds of
all Equity Issuances effected at any time after the Agreement Date by the Parent
or any of its Subsidiaries to any Person other than the Parent or any of its
Subsidiaries (in the case of any Equity Issuance effected by a Subsidiary, the
amount of such Net Proceeds shall be appropriately adjusted to account for
minority interests consistent with GAAP) excluding (a) the Equity Issuances
described on Schedule 10.1.(a) the Net Proceeds of which shall not exceed an
aggregate amount of $45,000,000 and (b) Equity Issuances of common shares of the
Parent solely in exchange for equivalent operating units of the Borrower.
(b) Ratio of Total Liabilities to Gross Asset Value. The Parent shall
not permit the ratio of (i) Total Liabilities of the Parent and its Subsidiaries
determined on a consolidated basis to (ii) Gross Asset Value of the Parent and
its Subsidiaries determined on a consolidated basis, to exceed 0.650 to 1 at any
time.
(c) Ratio of EBITDA to Interest Expense. The Parent shall not permit
the ratio of (i) EBITDA of the Parent and its Subsidiaries and determined on a
consolidated basis for the period of four consecutive fiscal quarters most
recently ending to (ii) Interest Expense of the Parent and its Subsidiaries
determined on a consolidated basis for such period, to be less than (x) 1.750 to
1 for any such period ending on or before December 31, 2001 and (y) 1.90 to 1
for any such period ending thereafter.
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(d) Ratio of Adjusted EBITDA to Debt Service. The Parent shall not
permit the ratio of (i) Adjusted EBITDA of the Parent and its Subsidiaries
determined on a consolidated basis for the period of four consecutive fiscal
quarters most recently ending to (ii) Debt Service of the Parent and its
Subsidiaries determined on a consolidated basis for such period, to be less than
(x) 1.40 to 1 for any period ending on or before December 31, 2001 and (y) 1.550
to 1 for any period ending thereafter.
(e) Permitted Investments. The Parent and the Borrower shall not make
any Investment in or otherwise own, and shall not permit any Subsidiary to make
any Investment in or otherwise own, the following items which would cause the
aggregate value of such holdings of the Parent, the Borrower and its
Subsidiaries to exceed the following percentages of Gross Asset Value:
(i) unimproved real estate, such that the aggregate value of all
such unimproved real estate, calculated on the basis of cost, exceeds
5.0% of Gross Asset Value;
(ii) Investments in Persons (other than Investments in Subsidiaries
and Unconsolidated Affiliates) such that the aggregate value of such
Investment calculated on the basis of cost, exceeds 10.0% of Gross
Asset Value;
(iii) Mortgages in favor of the Parent, the Borrower or any other
Subsidiary, such that the aggregate amount of Indebtedness secured by
such Mortgages exceeds 10.0% of Gross Asset Value (excluding any
Mortgage encumbering any Property owned by a Subsidiary the accounts of
which are required to be consolidated with those of the Parent under
GAAP); and
(iv) Investments in Subsidiaries that are not Wholly Owned
Subsidiaries and Investments in Unconsolidated Affiliates such that the
aggregate value of such Investments calculated on the basis of cost,
exceeds 50.0% of Gross Asset Value.
In addition to the foregoing limitations, the aggregate value of the Investments
and other items subject to the limitations in the preceding clauses (i) through
(iii) shall not exceed 20.0% of Gross Asset Value.
(f) Aggregate Occupancy Rates. The Parent and the Borrower shall not
permit the weighted average aggregate Occupancy Rate (weighted on the basis of
aggregate square footage) of all Borrowing Base Properties to be less than or
equal to 85.0% at any time.
(g) Properties under Development or Redevelopment. The Parent and the
Borrower shall not permit the aggregate amount of Total Budgeted Cost Until
Stabilization with respect to all Development Properties and Major Redevelopment
Properties owned by the Parent, the Borrower, any Subsidiary or any
Unconsolidated Affiliate to exceed 25.0% of Gross Asset Value at any time. For
purposes of this subsection, the Total Budgeted Cost Until Stabilization with
respect to any Development Property or Major Redevelopment Property owned by an
Unconsolidated Affiliate of the Parent shall equal the greater of (i) the
product of (x) the Parent's Ownership Share in such Unconsolidated Affiliate and
(y) the Total Budgeted Cost Until Stabilization for such Property and (ii) the
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Parent's Recourse Share of all Indebtedness of such Unconsolidated Affiliate.
For purposes of calculating Gross Asset Value as used in this subsection, the
Gross Asset Value of Development Properties and Major Redevelopment Properties
shall include, without duplication of any other amounts already included
elsewhere in such calculation, the Total Budgeted Cost Until Stabilization of
such Properties.
(h) Leasing Requirement for Properties under Development or
Redevelopment. The Parent and the Borrower shall not at any time permit the
aggregate amount of projected rentable square footage of all Development
Properties and Major Redevelopment Properties owned by the Parent, the Borrower,
any Subsidiary or any Unconsolidated Affiliate subject to binding leases to be
less than 50.0% of the aggregate amount of projected rentable square footage of
all such Development Properties and Major Redevelopment Properties.
(i) Floating Rate Indebtedness. The Parent and the Borrower will not,
and will not permit any of their respective Subsidiaries to, incur, assume or
suffer to exist at any time Floating Rate Indebtedness in an aggregate
outstanding principal amount in excess of the aggregate amount of the Lenders'
Commitments.
Section 10.2. Restricted Payments.
The Parent and the Borrower will not declare or make, or permit any
other Subsidiary to declare or make, any Restricted Payment; provided, however,
that:
(a) the Parent may acquire limited partnership interests in the
Borrower in exchange for cash or common stock of the Parent;
(b) the Parent may declare or make cash distributions to its
shareholders during any period of four consecutive fiscal quarters in an
aggregate amount not to exceed the greater of (i) 95.0% of Funds From Operations
of the Parent for such period or (ii) the amount for the Parent to remain in
compliance with Section 9.13.;
(c) the Parent may make cash distributions to its shareholders of
capital gains resulting from gains from certain asset sales to the extent
necessary to avoid payment of taxes on such asset sales imposed under Sections
857(b)(3) and 4981 of the Internal Revenue Code;
(d) the Parent may make cash payments to repurchase outstanding shares
of its common stock;
(e) the Parent may cause the Borrower (directly or indirectly through
any intermediate Subsidiaries) to make distributions to the Parent and to the
limited partners of the Borrower, and the Parent may cause other Subsidiaries of
the Parent to make distributions to the Parent and to other holders of Equity
Interests in such Subsidiaries, in each case, so long as immediately after
giving effect to any such distribution no Default or Event of Default would
exist; and
(f) subject to the following sentence, if a Default or Event of Default
shall have occurred and be continuing, the Parent may only declare or make cash
distributions to its shareholders during any fiscal year in an aggregate amount
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not to exceed the minimum amount necessary for the Parent to remain in
compliance with Section 9.13.
Notwithstanding the foregoing, if a Default or Event of Default specified in
Section 11.1.(a), Section 11.1.(e) or Section 11.1.(f) shall have occurred and
be continuing, or if as a result of the occurrence of any other Event of Default
the Obligations have been accelerated pursuant to Section 11.2.(a), the Parent
and the Borrower shall not, and shall not permit any other Subsidiary to, make
any Restricted Payments to any Person whatsoever other than to the Borrower or
any Subsidiary.
Section 10.3. Restrictions on Intercompany Transfers.
With respect to any Subsidiary that owns Property included in the
Collateral, the Borrower shall not create or otherwise cause or suffer to exist
or become effective, or permit any such Subsidiary to create or otherwise cause
or suffer to exist or become effective, any consensual encumbrance or
restriction of any kind on the ability of such Subsidiary to: (i) pay dividends
or make any other distribution on any of such Subsidiary's capital stock or
other equity interests owned by the Borrower or such Subsidiary of the Borrower;
(ii) pay any Indebtedness owed to the Borrower or any Subsidiary; (iii) make
loans or advances to the Borrower or any Subsidiary; or (iv) transfer any of its
property or assets to the Borrower or any Subsidiary; provided, however that the
Borrower or any such Subsidiary may have provision for preferred, priority or
guaranteed payments to a joint venture partner of such Subsidiary.
Section 10.4. Mergers, Acquisitions and Sales of Assets.
The Parent and the Borrower shall not (a) enter into, and shall not
permit any other Loan Party to enter into, any transaction of merger or
consolidation; (b) liquidate, wind-up or dissolve itself (or suffer any
liquidation or dissolution) or permit any other Loan Party to do any of the
foregoing; (c) convey, sell, lease, sublease, transfer or otherwise dispose of,
in one transaction or a series of transactions, all or any substantial part of
its business or assets, or the capital stock of or other Equity Interests in any
of its Subsidiaries, whether now owned or hereafter acquired or permit any Loan
Party to do any of the foregoing or (d) acquire a Substantial Amount of the
assets of, or make an Investment of a Substantial Amount in, any other Person or
permit any Loan Party to do any of the foregoing; provided, however, that:
(i) any Loan Party that is a Subsidiary of the Parent or the
Borrower may merge or consolidate with the Parent, the Borrower, or a
Subsidiary of the Parent or of the Borrower so long as in the case of
(A) a merger or consolidation involving the Parent or the Borrower, the
Parent or the Borrower, as the case may be, is the survivor and (B) any
other merger or consolidation, the survivor is, or will become upon the
consummation of such merger or consolidation, a Loan Party;
(ii) any Loan Party may sell, transfer or dispose of its assets to
the Borrower or a Subsidiary that is a Loan Party;
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(iii) a Loan Party (other than the Borrower, the Parent or any Loan
Party which owns a Borrowing Base Property or Construction Property)
may convey, sell, transfer or otherwise dispose of, in one transaction
or a series of transactions, all or any substantial part of its
business or assets, or the capital stock of or other Equity Interests
in any of its Subsidiaries, and thereafter liquidate, provided that
immediately prior to any such conveyance, sale, transfer, disposition
or liquidation and immediately thereafter and after giving effect
thereto, no Default or Event of Default is or would be in existence;
(iv) the Parent, the Borrower and any other Loan Party may,
directly or indirectly, (A) acquire (whether by purchase, acquisition
of Equity Interests of a Person, or as a result of a merger or
consolidation) a Substantial Amount of the assets of, or make an
Investment of a Substantial Amount in, any other Person and (B) sell,
lease or otherwise transfer, whether by one or a series of
transactions, a Substantial Amount of assets (including capital stock
or other securities of Subsidiaries) to any other Person, so long as,
in each case, (1) the Parent shall have given the Agent and the Lenders
at least 30 days prior written notice of such consolidation, merger,
acquisition, Investment, sale, lease or other transfer; (2) immediately
prior thereto, and immediately thereafter and after giving effect
thereto, no Default or Event of Default is or would be in existence;
(3) in the case of a consolidation or merger by the Parent, the
Borrower or a Loan Party which owns a Borrowing Base Property or
Construction Property, such Person shall be the survivor thereof and
(4) at the time the Parent gives notice pursuant to clause (1) of this
subsection, the Parent shall have delivered to the Agent and the
Lenders a Compliance Certificate, calculated on a pro forma basis,
evidencing the continued compliance by the Borrower and the Parent with
the terms and conditions of this Agreement and the other Loan
Documents, including without limitation, the financial covenants
contained in Section 10.1., after giving effect to such consolidation,
merger, acquisition, Investment, sale, lease or other transfer;
(v) any Loan Party (other than the Borrower or the Parent) may
convey, sell, lease, sublease, transfer or otherwise dispose of, in one
transaction or a series of transactions, all or any substantial part of
its business or assets, or the capital stock of or other Equity
Interests in any of its Subsidiaries, whether now owned or hereafter
acquired if (A) such Loan Party does not own a Borrowing Base Property
or Construction Property or (B) if such Loan Party does own a Borrowing
Base Property or Construction Property, such Property is to be released
pursuant to Section 4.1.(g) or Section 5.1.(e), as applicable, prior to
or in connection with such transaction; and
(vi) the Parent, the Borrower and any other Loan Party may lease
and sublease its assets, as lessor or sublessor (as the case may be),
in the ordinary course of their business.
Section 10.5. Fiscal Year.
The Parent shall not change its fiscal year from that in effect as of
the Agreement Date.
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Section 10.6. Modifications of Organizational Documents and Material Contracts.
The Parent shall not amend, supplement, restate or otherwise modify the
Trust Agreement, and the Borrower shall not amend, supplement, restate or
otherwise modify the Partnership Agreement, in each case in any respect, without
the prior written consent of the Agent and the Requisite Lenders unless such
amendment, supplement, restatement or other modification could not reasonably be
expected to have in a Material Adverse Effect. The Borrower and the Parent shall
not enter into, and shall not permit any Subsidiary or other Loan Party to enter
into, any amendment or modification to any Material Contract that could
reasonably be expected to have a Material Adverse Effect.
Section 10.7. Transactions with Affiliates.
The Borrower and the Parent shall not permit to exist or enter into,
and will not permit any of its Subsidiaries to permit to exist or enter into,
any transaction (including the purchase, sale, lease or exchange of any property
or the rendering of any service) with any Affiliate, except (a) transactions in
the ordinary course of and pursuant to the reasonable requirements of the
business of the Borrower, the Parent or any Subsidiary and upon fair and
reasonable terms which are no less favorable to the Borrower, the Parent or such
Subsidiary than would be obtained in a comparable arm's length transaction with
a Person that is not an Affiliate, (b) transactions between or among the Parent,
the Borrower and it Subsidiaries and (c) the transactions described on Schedule
10.1.(a).
Section 10.8. ERISA Exemptions.
The Borrower and the Parent shall not permit, and shall not permit any
other Loan Party or any other Subsidiary to permit, any of its respective assets
to become or be deemed to be "plan assets" within the meaning of ERISA, the
Internal Revenue Code and the respective regulations promulgated thereunder.
Section 10.9. Negative Pledge.
The Borrower will not create, assume or suffer to exist, and will not
permit any Subsidiary to create, assume or suffer to exist, any Lien on any
Borrowing Base Property or any of the other Collateral, now owned or hereafter
acquired, except for Permitted Liens.
ARTICLE XI. DEFAULT
Section 11.1. Events of Default.
Each of the following shall constitute an Event of Default, whatever
the reason for such event and whether it shall be voluntary or involuntary or be
effected by operation of Applicable Law or pursuant to any judgment or order of
any Governmental Authority:
(a) Default in Payment. The Borrower or any Subsidiary Borrower shall
fail to pay when due under this Agreement or any other Loan Document (whether
upon demand, at maturity, by reason of acceleration or otherwise) the principal
of, or any interest on, any of the Loans, or shall fail to pay any of the other
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payment Obligations owing by the Borrower or any Subsidiary Borrower under this
Agreement or any other Loan Document, or any other Loan Party shall fail to pay
when due any payment obligation owing by such Loan Party under any Loan Document
to which it is a party and any such failure shall continue for a period of five
(5) calendar days thereafter.
(b) Default in Performance.
(i) The Borrower or the Parent shall fail to perform or observe any
term, covenant, condition or agreement on its part to be performed or
observed and contained in Sections 9.1.(r) or Article X.; or
(ii) The Borrower, the Parent or any other Loan Party shall fail to
perform or observe any term, covenant, condition or agreement contained
in this Agreement or any other Loan Document (other than a Security
Document) to which it is a party and not otherwise mentioned in this
Section and such failure shall continue for a period of 30 days after
the earlier of (x) the date upon which the Borrower obtains knowledge
of such failure or (y) the date upon which the Parent or the Borrower
has received written notice of such failure from the Agent; provided,
however, that if any such failure referred to in this clause (ii) is
reasonably capable of being cured but not within such 30-day period and
the Borrower has in good faith commenced to cure such failure prior to
the expiration of such 30-day period and continues to diligently
prosecute such cure, no Event of Default shall be deemed to have
occurred unless such failure has not been cured within 30 calendar days
after the last day of such initial 30-day period;
(c) Misrepresentations. Any written statement, representation or
warranty made or deemed made by or on behalf of the Borrower, the Parent or any
other Loan Party under this Agreement or under any other Loan Document (other
than a Security Document), or any amendment hereto or thereto, or in any other
writing or statement (other than forward looking statements) at any time
furnished by, or at the direction of, the Borrower, the Parent or any other Loan
Party to the Agent, the Swingline Lender or any Lender, shall at any time prove
to have been incorrect or misleading in any material respect when furnished or
made.
(d) Indebtedness Cross-Default.
(i) The Parent, the Borrower, any other Loan Party, any other
Subsidiary shall fail to pay when due and payable the principal of, or
interest on, any Indebtedness (other than the Loans) having an
aggregate outstanding principal amount of $5,000,000 or more, and in
any such case such failure shall continue beyond any applicable notice
and cure periods; or
(ii) The maturity of any such Indebtedness shall have (x) been
accelerated in accordance with the provisions of any indenture,
contract or instrument evidencing, providing for the creation of or
otherwise concerning such Indebtedness or (y) been required to be
prepaid or repurchased prior to the stated maturity thereof.
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(e) Voluntary Bankruptcy Proceeding. The Borrower, the Parent or any
other Loan Party shall: (i) commence a voluntary case under the Bankruptcy Code
of 1978, as amended or other federal bankruptcy laws (as now or hereafter in
effect); (ii) file a petition seeking to take advantage of any other Applicable
Laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or adjustment of debts; (iii) consent to, or fail to
contest in a timely and appropriate manner, any petition filed against it in an
involuntary case under such bankruptcy laws or other Applicable Laws or consent
to any proceeding or action described in the immediately following subsection;
(iv) apply for or consent to, or fail to contest in a timely and appropriate
manner, the appointment of, or the taking of possession by, a receiver,
custodian, trustee, or liquidator of itself or of a substantial part of its
property, domestic or foreign; (v) admit in writing its inability to pay its
debts as they become due; (vi) make a general assignment for the benefit of
creditors; (vii) make a conveyance fraudulent as to creditors under any
Applicable Law; or (viii) take any corporate or partnership action for the
purpose of effecting any of the foregoing.
(f) Involuntary Bankruptcy Proceeding. A case or other proceeding shall
be commenced against the Borrower, the Parent or any other Loan Party in any
court of competent jurisdiction seeking: (i) relief under the Bankruptcy Code of
1978, as amended or other federal bankruptcy laws (as now or hereafter in
effect) or under any other Applicable Laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment
of debts; or (ii) the appointment of a trustee, receiver, custodian, liquidator
or the like of such Person, or of all or any substantial part of the assets,
domestic or foreign, of such Person, and in the case of either clause (i) or
(ii) such case or proceeding shall continue undismissed or unstayed for a period
of 60 consecutive days, or an order granting the relief requested in such case
or proceeding (including, but not limited to, an order for relief under such
Bankruptcy Code or such other federal bankruptcy laws) shall be entered.
(g) Revocation of Loan Documents. The Borrower, the Parent or any other
Loan Party shall disavow, revoke or terminate in writing any Loan Document to
which it is a party or shall otherwise challenge or contest in any action, suit
or proceeding in any court or before any Governmental Authority the validity or
enforceability of any Loan Document.
(h) Judgment. A judgment or order for the payment of money shall be
entered against the Borrower, the Parent or any other Loan Party, by any court
or other tribunal and (i) such judgment or order shall continue for a period of
30 days without being paid, bonded over, stayed or dismissed through appropriate
appellate proceedings and (ii) either (A) the amount for which the insurer has
denied liability exceeds, individually or together with all other such judgments
or orders entered against the Borrower, the Parent and the other Loan Parties,
$5,000,000 in amount or (B) could reasonably be expected to have a Material
Adverse Effect.
(i) Attachment. A warrant, writ of attachment, execution or similar
process shall be issued against any property of the Borrower, the Parent or any
other Loan Party, which exceeds, individually or together with all other such
warrants, writs, executions and processes, $5,000,000 in amount and such
warrant, writ, execution or process shall not be paid, discharged, vacated,
stayed or bonded for a period of 30 days.
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(j) ERISA.
(i) Any member of the ERISA Group shall fail to pay when due an
amount or amounts aggregating in excess of $1,000,000 which it shall
have become liable to pay under Title IV of ERISA and such failure
shall continue for a period of 30 days; or
(ii) Notice of intent to terminate a Material Plan shall be filed
under Title IV of ERISA by any member of the ERISA Group, any plan
administrator or any combination of the foregoing, the liability
resulting therefrom shall exceed $1,000,000 and either (A) such notice
shall not have been revoked or rescinded after 30 days from the filing
thereof or (B) such Material Plan shall be terminated; or
(iii) The PBGC shall institute proceedings under Title IV of ERISA
to terminate, to impose liability (other than for premiums under
Section 4007 of ERISA) in respect of, or to cause a trustee to be
appointed to administer any Material Plan, the liability resulting
therefrom shall exceed $1,000,000 and either (A) such proceedings shall
not have been dismissed or terminated after 30 days from the filing
thereof or (B) such Material Plan shall be terminated or such liability
shall be imposed; or
(iv) A condition shall exist by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any Material Plan must be
terminated, the liability resulting therefrom shall exceed $1,000,000
and such condition shall exist for a period of 30 days; or
(v) There shall occur a complete or partial withdrawal from, or a
default, within the meaning of Section 4219(c)(5) of ERISA, with
respect to, one or more Multiemployer Plans which could cause one or
more members of the ERISA Group to incur an obligation to pay on a
current annual basis during the term of this Agreement an amount in
excess of $1,000,000.
(k) Loan Documents. An Event of Default (as defined therein) shall
occur under any of the other Loan Documents (other than a Security Document);
(l) Change of Control/Change in Management.
(i) (A) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that a Person will be deemed to have "beneficial ownership" of
all securities that such Person has the right to acquire, whether such
right is exercisable immediately or only after the passage of time),
directly or indirectly, of more than 20% of the total voting power of
the then outstanding voting stock of the Parent other than such Persons
who are, as of the Agreement Date, current officers or trustees of the
Parent or Affiliates of current officers or trustees of the Parent or
(B) during any period of 12 consecutive months ending after the
Agreement Date, individuals who at the beginning of any such 12-month
period constituted the Board of Trustees of the Parent (together with
any new trustees whose election by such Board or whose nomination for
election by the shareholders of the Parent was approved by a vote of a
majority of the trustees then still in office who were either trustees
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at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute
a majority of the Board of Trustees of the Parent then in office;
(ii) If three or more of the following four individuals shall cease
for any reason (other than death, disability or resignation) to be
principally involved in the senior management of the Parent: Xxxxxx
Xxxxx, Xxxxxx Xxxxx, Xxxxxxxx X. Xxxxxx and Xxxxxx Xxxxxxxx (each a
"Principal Officer");
(iii) If three or more of the Principal Officers shall die, become
disabled or resign and the Parent shall have failed to replace the
resulting vacancies in senior management with individuals reasonably
acceptable to the Agent and the Requisite Lenders and such failure
shall continue for a period in excess of 120 days; or
(iv) The Parent or a Wholly Owned Subsidiary of the Parent that is
a Guarantor and Construction Guarantor shall cease (A) to be the sole
general partner of the Borrower or (B) to own and control, directly or
indirectly, at least 70.0% of all partnership interests of the
Borrower.
(m) Damage; Strike; Casualty. Any material damage to, or loss, theft or
destruction of, any Collateral, whether or not insured, or any strike, lockout,
labor dispute, embargo, condemnation, act of God or public enemy, or other
casualty which causes, for more than 30 consecutive days beyond the coverage
period of any applicable business interruption insurance, the cessation or
substantial curtailment of revenue producing activities of the Borrower or its
Subsidiaries taken as a whole and only if any such event or circumstance could
reasonably be expected to have a Material Adverse Effect.
Section 11.2. Remedies Upon Event of Default.
Upon the occurrence of an Event of Default the following provisions
shall apply:
(a) Acceleration; Termination of Facilities.
(i) Automatic. Upon the occurrence of an Event of Default specified
in Sections 11.1.(e) or 11.1.(f), (A)(1) the principal of, and all
accrued interest on, the Loans and the Notes at the time outstanding,
(2) an amount equal to the Stated Amount of all Letters of Credit
outstanding as of the date of the occurrence of the Event of Default
and (3) all of the other Obligations of the Borrower, including, but
not limited to, the other amounts owed to the Lenders, the Swingline
Lender and the Agent under this Agreement, the Notes or any of the
other Loan Documents, shall become immediately and automatically due
and payable without presentment, demand, protest, or other notice of
any kind, all of which are expressly waived by the Borrower and (B) the
Commitments and the obligation of the Lenders to make Revolving Loans
and Construction Advances hereunder, the Swingline Commitment and the
obligation of the Swingline Lender to make Swingline Loans hereunder,
and the obligation of the Agent to issue Letters of Credit hereunder,
shall immediately and automatically terminate.
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(ii) Optional. If any other Event of Default shall have occurred
and be continuing, the Agent may, and at the direction of the Requisite
Lenders shall: (A) declare (1) the principal of, and accrued interest
on, the Loans (excluding Swingline Loans) and the Notes (excluding
Swingline Notes) at the time outstanding, (2) an amount equal to the
Stated Amount of all Letters of Credit outstanding as of the date of
the occurrence of the Event of Default and (3) all of the other
Obligations, including, but not limited to, the other amounts owed to
the Lenders and the Agent under this Agreement, such Notes or any of
the other Loan Documents to be forthwith due and payable, whereupon the
same shall immediately become due and payable without presentment,
demand, protest or other notice of any kind, all of which are expressly
waived by the Borrower and (B) terminate the Commitments and the
obligation of the Lenders to make Revolving Loans and Construction
Advances hereunder and the obligation of the Agent to issue Letters of
Credit hereunder. If the Agent has exercised any of the rights provided
under the preceding sentence, the Swingline Lender shall: (I) declare
the principal of, and accrued interest on, the Swingline Loans and the
Swingline Notes at the time outstanding, and all of the other
Obligations owing to the Swingline Lender, to be forthwith due and
payable, whereupon the same shall immediately become due and payable
without presentment, demand, protest or other notice of any kind, all
of which are expressly waived by the Borrower and (II) terminate the
Swingline Commitment and the obligation of the Swingline Lender to make
Swingline Loans.
(b) Loan Documents. The Requisite Lenders may direct the Agent to, and
the Agent if so directed shall, exercise any and all of its rights and remedies
under or in respect of any and all of the other Loan Documents.
(c) Applicable Law. The Requisite Lenders may direct the Agent to, and
the Agent if so directed shall, exercise all other rights and remedies it may
have under any Applicable Law.
(d) Appointment of Receiver. To the extent permitted by Applicable Law,
the Agent and the Lenders shall be entitled to the appointment of a receiver for
any or all of the Collateral, without notice of any kind whatsoever and without
regard to the adequacy of any security for the Obligations or the solvency of
any party bound for their payment, to take possession of all or any portion of
the Collateral and to exercise such power as the court shall confer upon such
receiver.
Section 11.3. Termination of Commitments Upon Certain Defaults.
Upon the occurrence of a Default specified in Sections 11.1.(e) or
11.1.(f), the Commitments shall immediately and automatically terminate.
Section 11.4. Marshaling; Payments Set Aside.
Neither the Agent nor any Lender shall be under any obligation to
marshal any assets in favor of any Loan Party or any other party or against or
in payment of any or all of the Obligations. To the extent that any Loan Party
makes a payment or payments to the Agent and/or any Lender, or the Agent and/or
any Lender enforce their security interests or exercise their rights of setoff,
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and such payment or payments or the proceeds of such enforcement or setoff or
any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, state or federal law, common law or
equitable cause, then to the extent of such recovery, the Obligations or part
thereof originally intended to be satisfied, and all Liens, rights and remedies
therefor, shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or setoff had not occurred.
Section 11.5. Allocation of Proceeds.
(a) Generally. Subject to the following subsection (b), if an Event of
Default shall have occurred and be continuing and maturity of any of the
Obligations has been accelerated, all payments received by the Agent under any
of the Loan Documents (other than the Construction Loan Security Documents), in
respect of any principal of or interest on the Obligations or any other amounts
payable by the Borrower or any other Loan Party hereunder or thereunder, shall
be applied in the following order and priority:
(i) amounts due to the Agent and the Lenders in respect of Fees and
other fees and expenses due under Section 13.2.;
(ii) payments of interest on Swingline Loans;
(iii) payments of interest on all other Loans, to be applied for
the ratable benefit of the Lenders, in such order as the Lenders may
determine in their sole discretion;
(iv) payment of principal on Swingline Loans;
(v) payments of principal of all other Loans, to be applied for the
ratable benefit of the Lenders, in such order as the Lenders may
determine in their sole discretion;
(vi) amounts due to the Agent and the Lenders pursuant to Sections
12.7. and 13.9.;
(vii) payments of all other amounts due under any of the Loan
Documents, if any, to be applied for the ratable benefit of the
Lenders; and
(viii) any amount remaining after application as provided above,
shall be paid to the Borrower or whomever else may be legally entitled
thereto.
(b) Construction Loans. Notwithstanding the immediately preceding
subsection (a), if an Event of Default shall have occurred and be continuing and
maturity of any of the Obligations secured by any of the Construction Loan
Security Documents has been accelerated, all payments received by the Agent
under any of the Loan Documents, in respect of any principal of or interest on
the Obligations secured by any of the Construction Loan Security Documents or
any other amounts payable by the Borrower or any other Loan Party hereunder or
thereunder in respect of any Obligations secured by any of the Construction Loan
Security Documents, shall be applied in the following order and priority:
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(i) amounts due to the Agent and the Lenders in respect of Fees and
other fees and expenses due under Section 13.2., to the extent secured
by any of the Construction Loan Security Documents;
(ii) payments of interest on all Constructions Loans, to be applied
for the ratable benefit of the Lenders, in such order as the Lenders
may determine in their sole discretion;
(iii) payments of principal of all Constructions Loans, to be
applied for the ratable benefit of the Lenders, in such order as the
Lenders may determine in their sole discretion;
(iv) amounts due to the Agent and the Lenders pursuant to Sections
12.7. and 13.9., to the extent secured by any of the Construction Loan
Security Documents;
(v) payments of all other amounts due under any of the Loan
Documents, if any, to the extent secured by any of the Construction
Loan Security Documents and to be applied for the ratable benefit of
the Lenders; and
(vi) any amount remaining after application as provided above,
shall be paid to the Borrower or whomever else may be legally entitled
thereto.
Section 11.6. Letter of Credit Collateral Account.
(a) As collateral security for the prompt payment in full when due of
all Letter of Credit Liabilities, the Borrower hereby pledges and grants to the
Agent, for the benefit of the Agent and the Lenders as provided herein, a
security interest in all of its right, title and interest in and to the Letter
of Credit Collateral Account and the balances from time to time in the Letter of
Credit Collateral Account (including the investments and reinvestments therein
provided for below). The balances from time to time in the Letter of Credit
Collateral Account shall not constitute payment of any Letter of Credit
Liabilities until applied by the Agent as provided herein. Anything in this
Agreement to the contrary notwithstanding, funds held in the Letter of Credit
Collateral Account shall be subject to withdrawal only as provided in this
Section and in Section 2.13.
(b) So long as no Event of Default shall exist, amounts on deposit in
the Letter of Credit Collateral Account shall be invested and reinvested by the
Agent in such Cash Equivalents as determined by the Borrower with the approval
of the Agent. If an Event of Default shall exist, amounts on deposit in the
Letter of Credit Collateral Account shall be invested and reinvested by the
Agent in such Cash Equivalents as the Agent shall determine in its sole
discretion. All such investments and reinvestments shall be held in the name of
and be under the sole dominion and control of the Agent, provided, that all
earnings on such investments will be credited to and retained in the Letter of
Credit Collateral Account. The Agent shall exercise reasonable care in the
custody and preservation of any funds held in the Letter of Credit Collateral
Account and shall be deemed to have exercised such care if such funds are
accorded treatment substantially equivalent to that which the Agent accords
other funds deposited with the Agent, it being understood that the Agent shall
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not have any responsibility for taking any necessary steps to preserve rights
against any parties with respect to any funds held in the Letter of Credit
Collateral Account.
(c) If an Event of Default shall have occurred and be continuing, the
Agent may (and, if instructed by the Requisite Lenders, shall) in its (or their)
discretion at any time and from time to time elect to liquidate any such
investments and reinvestments and credit the proceeds thereof to the Letter of
Credit Collateral Account and apply or cause to be applied such proceeds and any
other balances in the Letter of Credit Collateral Account to the payment of any
of the Letter of Credit Liabilities due and payable.
(d) If no Default or Event of Default has occurred and is continuing,
the Agent shall, from time to time, at the request of the Borrower, deliver to
the Borrower, against receipt but without any recourse, warranty or
representation whatsoever, such of the balances in the Letter of Credit
Collateral Account as exceed the aggregate amount of Letter of Credit
Liabilities at such time. When all of the Obligations shall have been
indefeasibly paid in full and no Letters of Credit remain outstanding, the Agent
shall deliver to the Borrower, against receipt but without any recourse,
warranty or representation whatsoever, the balances remaining in the Letter of
Credit Collateral Account.
(e) The Borrower shall pay to the Agent from time to time such fees as
the Agent normally charges for similar services in connection with the Agent's
administration of the Letter of Credit Collateral Account and investments and
reinvestments of funds therein.
Section 11.7. Performance by Agent.
If the Borrower shall fail to perform any covenant, duty or agreement
contained in any of the Loan Documents, the Agent may perform or attempt to
perform such covenant, duty or agreement on behalf of the Borrower after the
expiration of any cure or grace periods set forth herein. In such event, the
Borrower shall, at the request of the Agent, promptly pay any amount reasonably
expended by the Agent in such performance or attempted performance to the Agent,
together with interest thereon at the applicable Post-Default Rate from the date
of such expenditure until paid. Notwithstanding the foregoing, neither the Agent
nor any Lender shall have any liability or responsibility whatsoever for the
performance of any obligation of the Borrower under this Agreement or any other
Loan Document.
Section 11.8. Rights Cumulative.
The rights and remedies of the Agent and the Lenders under this
Agreement and each of the other Loan Documents shall be cumulative and not
exclusive of any rights or remedies which any of them may otherwise have under
Applicable Law. In exercising their respective rights and remedies, the Agent
and the Lenders may be selective and no failure or delay by the Agent or any of
the Lenders in exercising any right shall operate as a waiver of it, nor shall
any single or partial exercise of any power or right preclude its other or
further exercise or the exercise of any other power or right.
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ARTICLE XII. THE AGENT
Section 12.1. Authorization and Action.
Each Lender hereby appoints and authorizes the Agent to take such
action as contractual representative on such Lender's behalf and to exercise
such powers under this Agreement and the other Loan Documents as are
specifically delegated to the Agent by the terms hereof and thereof, together
with such powers as are reasonably incidental thereto. Nothing herein shall be
construed to deem the Agent a trustee or fiduciary for any Lender nor to impose
on the Agent duties or obligations other than those expressly provided for
herein. At the request of a Lender, the Agent will forward to such Lender copies
or, where appropriate, originals of the documents delivered to the Agent
pursuant to this Agreement or the other Loan Documents. The Agent will also
furnish to any Lender, upon the request of such Lender, a copy of any
certificate or notice furnished to the Agent by the Borrower, any Loan Party or
any other Affiliate of the Borrower, pursuant to this Agreement or any other
Loan Document not already delivered to such Lender pursuant to the terms of this
Agreement or any such other Loan Document. As to any matters not expressly
provided for by the Loan Documents (including, without limitation, enforcement
or collection of any of the Obligations), the Agent shall not be required to
exercise any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of the Requisite Lenders (or all of the
Lenders if explicitly required under any other provision of this Agreement), and
such instructions shall be binding upon all Lenders and all holders of any of
the Obligations; provided, however, that, notwithstanding anything in this
Agreement to the contrary, the Agent shall not be required to take any action
which exposes the Agent to personal liability or which is contrary to this
Agreement or any other Loan Document or Applicable Law. Not in limitation of the
foregoing, the Agent shall not exercise any right or remedy it or the Lenders
may have under any Loan Document upon the occurrence of a Default or an Event of
Default unless the Requisite Lenders have so directed the Agent to exercise such
right or remedy.
Section 12.2. Agent's Reliance, Etc.
Notwithstanding any other provisions of this Agreement or any other
Loan Documents, neither the Agent nor any of its directors, officers, agents,
employees or counsel shall be liable for any action taken or omitted to be taken
by it or them under or in connection with this Agreement, except for its or
their own gross negligence or willful misconduct. Without limiting the
generality of the foregoing, the Agent: (a) may treat the payee of any Revolving
Note as the holder thereof until the Agent receives written notice of the
assignment or transfer thereof signed by such payee and in form satisfactory to
the Agent; (b) may consult with legal counsel (including its own counsel or
counsel for the Borrower or any Loan Party), independent public accountants and
other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts; (c) makes no warranty or representation to any
Lender or any other Person and shall not be responsible to any Lender or any
other Person for any statements, warranties or representations made by any
Person in or in connection with this Agreement or any other Loan Document; (d)
shall not have any duty to ascertain or to inquire as to the performance or
observance of any of the terms, covenants or conditions of any of this Agreement
or any other Loan Document or the satisfaction of any conditions precedent under
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this Agreement or any Loan Document on the part of the Borrower or other Persons
or inspect the property, books or records of the Borrower or any other Person;
(e) shall not be responsible to any Lender for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement or
any other Loan Document, any other instrument or document furnished pursuant
thereto or any Collateral covered thereby or the perfection or priority of any
Lien in favor of the Agent on behalf of the Lenders in any such Collateral; and
(f) shall incur no liability under or in respect of this Agreement or any other
Loan Document by acting upon any notice, consent, certificate or other
instrument or writing (which may be by telephone or telecopy) believed by it to
be genuine and signed, sent or given by the proper party or parties.
Section 12.3. Notice of Defaults.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of a Default or Event of Default unless the Agent has received notice
from a Lender or the Borrower referring to this Agreement, describing with
reasonable specificity such Default or Event of Default and stating that such
notice is a "notice of default." If any Lender (excluding the Agent in its
capacity as a Lender) becomes aware of any Default or Event of Default, it shall
promptly send to the Agent such a "notice of default." Further, if the Agent
receives such a "notice of default", the Agent shall give prompt notice thereof
to the Lenders.
Section 12.4. Xxxxx Fargo as Lender.
Xxxxx Fargo, as a "Lender", shall have the same rights and powers under
this Agreement and any other Loan Document as any other Lender and may exercise
the same as though it were not the Agent; and the term "Lender" or "Lenders"
shall, unless otherwise expressly indicated, include Xxxxx Fargo in each case in
its individual capacity. Xxxxx Fargo and its affiliates may each accept deposits
from, maintain deposits or credit balances for, invest in, lend money to, act as
trustee under indentures of, serve as financial advisor to, and generally engage
in any kind of business with the Borrower, any other Loan Party or any other
affiliate thereof as if it were any other bank and without any duty to account
therefor to the other Lenders. Further, the Agent and any affiliate may accept
fees and other consideration from the Borrower for services in connection with
this Agreement and otherwise without having to account for the same to the other
Lenders.
Section 12.5. Approvals of Lenders.
All communications from the Agent to any Lender requesting such
Lender's determination, consent, approval or disapproval (a) shall be given in
the form of a written notice to such Lender, (b) shall be accompanied by a
description of the matter or issue as to which such determination, approval,
consent or disapproval is requested, or shall advise such Lender where
information, if any, regarding such matter or issue may be inspected, or shall
otherwise describe the matter or issue to be resolved, (c) shall include, if
reasonably requested by such Lender and to the extent not previously provided to
such Lender, written materials and a summary of all oral information provided to
the Agent by the Borrower in respect of the matter or issue to be resolved, and
(d) shall include the Agent's recommended course of action or determination in
respect thereof. Each Lender shall reply promptly, but in any event within 10
Business Days of receipt of such communication (or such lesser period as may be
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required under the Loan Documents for the Agent to respond). Unless a Lender
shall give written notice to the Agent that it specifically objects to the
recommendation or determination of the Agent (together with a written
explanation of the reasons behind such objection) within the applicable time
period for reply, such Lender shall be deemed to have conclusively approved of
or consented to such recommendation or determination.
Section 12.6. Lender Credit Decision, Etc.
Each Lender expressly acknowledges and agrees that neither the Agent
nor any of its officers, directors, employees, agents, counsel,
attorneys-in-fact or other affiliates has made any representations or warranties
as to the financial condition, operations, creditworthiness, solvency or other
information concerning the business or affairs of the Borrower, any other Loan
Party, any Subsidiary or other Person to such Lender and that no act by the
Agent hereinafter taken, including any review of the affairs of the Borrower,
shall be deemed to constitute any such representation or warranty by the Agent
to any Lender. Each Lender acknowledges that it has, independently and without
reliance upon the Agent, any other Lender or counsel to the Agent, or any of
their respective officers, directors, employees and agents, and based on the
financial statements of the Borrower, the Subsidiaries or any other Affiliate
thereof, and inquiries of such Persons, its independent due diligence of the
business and affairs of the Borrower, the Loan Parties, the Subsidiaries and
other Persons, its review of the Loan Documents, the legal opinions required to
be delivered to it hereunder, the advice of its own counsel and such other
documents and information as it has deemed appropriate, made its own credit and
legal analysis and decision to enter into this Agreement and the transaction
contemplated hereby. Each Lender also acknowledges that it will, independently
and without reliance upon the Agent, any other Lender or counsel to the Agent or
any of their respective officers, directors, employees and agents, and based on
such review, advice, documents and information as it shall deem appropriate at
the time, continue to make its own decisions in taking or not taking action
under the Loan Documents. Except for notices, reports and other documents and
information expressly required to be furnished to the Lenders by the Agent under
this Agreement or any of the other Loan Documents, the Agent shall have no duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, financial and other condition or
creditworthiness of the Borrower, any other Loan Party or any other Affiliate
thereof which may come into possession of the Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or other Affiliates. Each Lender
acknowledges that the Agent's legal counsel in connection with the transactions
contemplated by this Agreement is only acting as counsel to the Agent and is not
acting as counsel to such Lender.
Section 12.7. Indemnification of Agent.
Each Lender agrees to indemnify the Agent (to the extent not reimbursed
by the Borrower and without limiting the obligation of the Borrower to do so)
pro rata in accordance with such Lender's respective Total Commitment
Percentage, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may at any time be imposed on, incurred
by, or asserted against the Agent (in its capacity as Agent but not as a
"Lender") in any way relating to or arising out of the Loan Documents, any
transaction contemplated hereby or thereby or any action taken or omitted by the
Agent under the Loan Documents (collectively, "Indemnifiable Amounts");
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provided, however, that no Lender shall be liable for any portion of such
Indemnifiable Amounts to the extent resulting from the Agent's gross negligence
or willful misconduct or if the Agent fails to follow the written direction of
the Requisite Lenders unless such failure is pursuant to the advice of counsel
of which the Lenders have received notice. Without limiting the generality of
the foregoing, each Lender agrees to reimburse the Agent promptly upon demand
for its ratable share of any out-of-pocket expenses (including counsel fees of
the counsel(s) of the Agent's own choosing) incurred by the Agent in connection
with the preparation, execution, administration, or enforcement of, or legal
advice with respect to the rights or responsibilities of the parties under, the
Loan Documents, any suit or action brought by the Agent to enforce the terms of
the Loan Documents and/or collect any Obligations, any "lender liability" suit
or claim brought against the Agent and/or the Lenders, and any claim or suit
brought against the Agent and/or the Lenders arising under any Environmental
Laws, to the extent that the Agent is not reimbursed for such expenses by the
Borrower. Such out-of-pocket expenses (including counsel fees) shall be advanced
by the Lenders on the request of the Agent notwithstanding any claim or
assertion that the Agent is not entitled to indemnification hereunder upon
receipt of an undertaking by the Agent that the Agent will reimburse the Lenders
if it is actually and finally determined by a court of competent jurisdiction
that the Agent is not so entitled to indemnification. The agreements in this
Section shall survive the payment of the Loans and all other amounts payable
hereunder or under the other Loan Documents and the termination of this
Agreement.
Section 12.8. Collateral Matters; Protective Advances.
(a) Each Lender authorizes and directs the Agent to enter into the Loan
Documents for the benefit of the Lenders. Each Lender hereby agrees that, except
as otherwise set forth herein, any action taken by the Requisite Lenders in
accordance with the provisions of this Agreement or the Loan Documents, and the
exercise by the Requisite Lenders of the powers set forth herein or therein,
together with such other powers as are reasonably incidental thereto, shall be
authorized and binding upon all of the Lenders. The Agent is hereby authorized
on behalf of all of the Lenders, without the necessity of any notice to or
further consent from any Lender, from time to time prior to an Event of Default,
to take any action with respect to any Collateral or Loan Documents which may be
necessary to perfect and maintain perfected the Liens upon the Collateral
granted pursuant to any of the Loan Documents.
(b) The Lenders hereby authorize the Agent, at its option and in its
discretion, to release any Lien granted to or held by the Agent upon any
Collateral (i) upon termination of the Credit Agreement in accordance with
Section 13.10.; and (ii) as expressly permitted by, but only in accordance with,
the terms of the applicable Loan Document. Upon request by the Agent at any
time, the Lenders will confirm in writing the Agent's authority to release
particular types or items of Collateral pursuant to this Section.
(c) Upon any sale and transfer of Collateral which is expressly
permitted pursuant to the terms of this Agreement, or consented to by the
Requisite Lenders or all of the Lenders, as applicable, and upon at least 5
Business Days' prior written request by the Borrower, the Agent shall (and is
hereby irrevocably authorized by the Lenders to) execute such documents as may
be necessary to evidence the release of the Liens granted to the Agent for the
benefit of the Lenders herein or pursuant hereto upon the Collateral that was
sold or transferred; provided, however, that (i) the Agent shall not be required
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to execute any such document on terms which, in the Agent's opinion, would
expose the Agent to liability or create any obligation or entail any consequence
other than the release of such Liens without recourse or warranty and (ii) such
release shall not in any manner discharge, affect or impair the Obligations or
any Liens upon (or obligations of the Borrower or any other Loan Party in
respect of) all interests retained by the Borrower or any other Loan Party,
including without limitation, the proceeds of the sale, all of which shall
continue to constitute part of the Collateral. In the event of any sale or
transfer of Collateral, or any foreclosure with respect to any of the
Collateral, the Agent shall be authorized to deduct all of the expenses
reasonably incurred by the Agent from the proceeds of any such sale, transfer or
foreclosure.
(d) The Agent shall have no obligation whatsoever to the Lenders or to
any other Person to assure that the Collateral exists or is owned by the
Borrower, any other Loan Party or any other Subsidiary or is cared for,
protected or insured or that the Liens granted to the Agent herein or pursuant
hereto have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority, or to exercise
or to continue exercising at all or in any manner or under any duty of care,
disclosure or fidelity any of the rights, authorities and powers granted or
available to the Agent in this Section or in any of the Loan Documents, it being
understood and agreed that in respect of the Collateral, or any act, omission or
event related thereto, the Agent may act in any manner it may deem appropriate,
in its sole discretion, given the Agent's own interest in the Collateral as one
of the Lenders and that the Agent shall have no duty or liability whatsoever to
the Lenders, except to the extent resulting from its gross negligence or willful
misconduct.
(e) The Agent may make, and shall be reimbursed by the Lenders (in
accordance with their Total Commitment Percentages) to the extent not reimbursed
by the Borrower for, Protective Advances during any one year with respect to
each Property that is Collateral up to the sum of (i) amounts expended to pay
real estate taxes, assessments and governmental charges or levies imposed upon
such Property; (ii) amounts expended to pay insurance premiums for policies of
insurance related to such Property; and (iii) $100,000. Protective Advances in
excess of said sum during any year for any Property that is Collateral shall
require the consent of the Requisite Lenders. The Borrower agrees to pay on
demand all Protective Advances.
Section 12.9. Post-Foreclosure Plans.
If all or any portion of the Collateral is acquired by the Agent as a
result of a foreclosure or the acceptance of a deed or assignment in lieu of
foreclosure, or is retained in satisfaction of all or any part of the
Obligations, the title to any such Collateral, or any portion thereof, shall be
held in the name of the Agent or a nominee or Subsidiary of the Agent, as agent,
for the ratable benefit of all Lenders. The Agent shall prepare a recommended
course of action for such Collateral (a "Post-Foreclosure Plan"), which shall be
subject to the approval of the Requisite Lenders. In accordance with the
approved Post-Foreclosure Plan, the Agent shall manage, operate, repair,
administer, complete, construct, restore or otherwise deal with the Collateral
acquired, and shall administer all transactions relating thereto, including,
without limitation, employing a management agent, leasing agent and other
agents, contractors and employees, including agents for the sale of such
Collateral, and the collecting of rents and other sums from such Collateral and
paying the expenses of such Collateral. Actions taken by the Agent with respect
to the Collateral, which are not specifically provided for in the approved
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Post-Foreclosure Plan or reasonably incidental thereto, shall require the
written consent of the Requisite Lenders by way of supplement to such
Post-Foreclosure Plan. Upon demand therefor from time to time, each Lender will
contribute its share (based on its Total Commitment Percentage at such time) of
all reasonable costs and expenses incurred by the Agent pursuant to the approved
Post-Foreclosure Plan in connection with the construction, operation,
management, maintenance, leasing and sale of such Collateral. In addition, the
Agent shall render or cause to be rendered to each Lender, on a monthly basis,
an income and expense statement for such Collateral, and each Lender shall
promptly contribute its Total Commitment Percentage of any operating loss for
such Collateral, and such other expenses and operating reserves as the Agent
shall deem reasonably necessary pursuant to and in accordance with the approved
Post-Foreclosure Plan. To the extent there is net operating income from such
Collateral, the Agent shall, in accordance with the approved Post-Foreclosure
Plan, determine the amount and timing of distributions to the Lenders. All such
distributions shall be made to the Lenders in accordance with their respective
Total Commitment Percentages. The Lenders acknowledge and agree that if title to
any Collateral is obtained by the Agent or its nominee, such Collateral will not
be held as a permanent investment but will be liquidated as soon as practicable.
The Agent shall undertake to sell such Collateral, at such price and upon such
terms and conditions as the Requisite Lenders reasonably shall determine to be
most advantageous to the Lenders. Any purchase money mortgage or deed of trust
taken in connection with the disposition of such Collateral in accordance with
the immediately preceding sentence shall name the Agent, as agent for the
Lenders, as the beneficiary or mortgagee. In such case, the Agent and the
Lenders shall enter into an agreement with respect to such purchase money
mortgage or deed of trust defining the rights of the Lenders in the same Total
Commitment Percentages as provided hereunder, which agreement shall be in all
material respects similar to this Article insofar as the same is appropriate or
applicable. No Lender shall be entitled to partition the Collateral.
Section 12.10. Successor Agent.
The Agent may resign at any time as Agent under the Loan Documents by
giving written notice thereof to the Lenders and the Borrower. In the event of a
material breach of its duties hereunder, the Agent may be removed as Agent under
the Loan Documents at any time by all Lenders (other than the Agent as a
"Lender") and the Borrower upon 30-day's prior notice. Upon any such resignation
or removal, the Requisite Lenders (other than, in the case of the removal of the
Agent under the immediately preceding sentence, the Agent as a "Lender") shall
have the right to appoint a successor Agent which appointment shall, provided no
Default or Event of Default shall have occurred and be continuing, be subject to
the Borrower's approval, which approval shall not be unreasonably withheld or
delayed. If no successor Agent shall have been so appointed in accordance with
the immediately preceding sentence, and shall have accepted such appointment,
within 30 days after the resigning Agent's giving of notice of resignation or
the Lenders' removal of the resigning Agent, then the resigning or removed Agent
may, on behalf of the Lenders, appoint a successor Agent, which shall be a
Lender, if any Lender shall be willing to serve, and otherwise shall be an
Eligible Assignee. Upon the acceptance of any appointment as Agent hereunder by
a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the resigning
Agent, and the retiring Agent shall be discharged from its duties and
obligations under the Loan Documents. After any resigning Agent's resignation or
removal hereunder as Agent, the provisions of this Article XII shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Agent under the Loan Documents.
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Section 12.11. Syndication and Documentation Agents.
Neither the Syndication Agent nor the Documentation Agent assume any
responsibility or obligation hereunder, including, without limitation, for
servicing, enforcement or collection of any of the Loans, nor any duties as an
agent hereunder for Lenders. The titles of "Syndication Agent" and
"Documentation Agent" are solely honorific and imply no fiduciary responsibility
on the part of the Syndication Agent or the Documentation Agent to the Agent,
the Borrower, any Subsidiary Borrower or any Lender and the use of such titles
does not impose on the Syndication Agent nor the Documentation Agent any duties
or obligations greater than those of any other Lender or entitle the Syndication
Agent or the Documentation Agent to any rights other than those to which any
other Lender is entitled.
ARTICLE XIII. MISCELLANEOUS
Section 13.1. Notices.
Unless otherwise provided herein, communications provided for hereunder
shall be in writing and shall be mailed, telecopied or delivered as follows:
If to the Borrower:
PREIT Associates, L.P.
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy of notices of Defaults, Events of Default or notices
pursuant to Article XI. to:
PREIT Associates, L.P.
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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And
Drinker, Xxxxxx & Xxxxx LLP
One Xxxxx Square
00xx xxx Xxxxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to the Agent or a Lender:
To the address or telecopy number, as applicable, of the Agent
or such Lender, as the case may be, set forth on its signature
page hereto or, in the case of a Lender, in the applicable
Assignment and Acceptance Agreement.
or, as to each party at such other address as shall be designated by such party
in a written notice to the other parties delivered in compliance with this
Section. All such notices and other communications shall be effective (i) if
mailed, when received; (ii) if telecopied, upon mechanical confirmation of
transmission if received on a Business Day prior to 5:00 p.m. local time at the
point of destination and, if otherwise, on the next succeeding Business Day; or
(iii) if hand delivered, when delivered. Notwithstanding the immediately
preceding sentence, all notices or communications to the Agent, the Swingline
Lender or any Lender under Article II. shall be effective only when actually
received. Any notice to the Borrower received by any individual designated by
the Borrower to receive such notice shall be effective notwithstanding the fact
that any other individual designated by the Borrower to receive a copy of such
notice did not receive such copy. Neither the Agent, the Swingline Lender nor
any Lender shall incur any liability to the Borrower (nor shall the Agent or the
Swingline Lender incur any liability to the Lenders) for acting upon any
telephonic notice referred to in this Agreement which the Agent, the Swingline
Lender or such Lender, as the case may be, believes in good faith to have been
given by a Person authorized to deliver such notice or for otherwise acting in
good faith hereunder. In addition to the Agent's Lending Office, the Borrower
shall send copies of the notices described in Article II. to the following
address of the Agent:
Xxxxx Fargo Bank, National Association
Disbursement and Operations Center
0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxx
Telecopy Number: (000) 000-0000
Telephone Number: (000) 000-0000
Section 13.2. Expenses.
The Borrower agrees (a) to pay or reimburse the Agent for all of its
reasonable out-of-pocket costs and expenses incurred in connection with the
preparation, negotiation and execution of, and any amendment, supplement or
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modification to, any of the Loan Documents, and the consummation of the
transactions contemplated thereby, including the reasonable fees and
disbursements of counsel to the Agent and all costs and expenses of the Agent in
connection with the review of Properties for inclusion in calculations of the
Borrowing Base and the Agent's other activities under Article IV., or the review
of prospective Construction Properties and the Agent's activities under Article
V., including in each case the cost of all Appraisals (except for Appraisals
ordered under Section 4.2.(d)) and the reasonable fees and disbursements of
counsel to the Agent relating to all such activities, (b) to pay or reimburse
the Agent and, after the occurrence and during the continuance of an Event of
Default, the Lenders, for all their costs and expenses incurred in connection
with the enforcement or preservation of any rights under the Loan Documents,
including the reasonable fees and disbursements of their respective counsel
(including the allocated fees and expenses of in-house counsel) and any payments
in indemnification or otherwise payable by the Lenders to the Agent pursuant to
the Loan Documents, (c) to pay, indemnify and hold the Agent and the Lenders
harmless from any and all recording and filing fees and any and all liabilities
with respect to, or resulting from any failure to pay or delay in paying,
documentary, stamp, excise and other similar taxes, if any, which may be payable
or determined to be payable in connection with the execution and delivery of any
of the Loan Documents, or consummation of any amendment, supplement or
modification of, or any waiver or consent under or in respect of, any Loan
Document and (d) to the extent not already covered by any of the preceding
subsections, to pay the fees and disbursements of counsel to the Agent and any
Lender incurred in connection with the representation of the Agent or such
Lender in any matter relating to or arising out of any bankruptcy or other
proceeding of the type described in Sections 11.1.(e) or 11.1.(f), including,
without limitation (i) any motion for relief from any stay or similar order,
(ii) the negotiation, preparation, execution and delivery of any document
relating to the Obligations and (iii) the negotiation and preparation of any
debtor-in-possession financing or any plan of reorganization of the Parent, the
Borrower or any other Loan Party, whether proposed by the Parent, the Borrower,
such Loan Party, the Lenders or any other Person, and whether such fees and
expenses are incurred prior to, during or after the commencement of such
proceeding or the confirmation or conclusion of any such proceeding.
Section 13.3. Setoff.
Subject to Section 3.3. and in addition to any rights now or hereafter
granted under Applicable Law and not by way of limitation of any such rights,
the Agent, each Lender and each Participant is hereby authorized by the
Borrower, at any time or from time to time, during the continuance of an Event
of Default without prior notice to the Borrower or to any other Person, any such
notice being hereby expressly waived, but in the case of a Lender or Participant
subject to receipt of the prior written consent of the Agent exercised in its
sole discretion, to set-off and to appropriate and to apply any and all deposits
(general or special, including, but not limited to, indebtedness evidenced by
certificates of deposit, whether matured or unmatured) and any other
indebtedness at any time held or owing by the Agent, such Lender or any
affiliate of the Agent or such Lender, to or for the credit or the account of
the Borrower against and on account of any of the Obligations, irrespective of
whether or not any or all of the Loans and all other Obligations have been
declared to be, or have otherwise become, due and payable as permitted by
Section 11.2., and although such obligations shall be contingent or unmatured.
Promptly following any such set-off the Agent shall notify the Borrower thereof
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and of the application of such set-off, provided that the failure to give such
notice shall not invalidate such set-off.
Section 13.4. Litigation; Jurisdiction; Other Matters; Waivers.
(a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY
BETWEEN OR AMONG THE BORROWER, THE AGENT, THE SWINGLINE LENDER OR ANY OF THE
LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD
RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED
BY APPLICABLE LAW, EACH OF THE LENDERS, THE SWINGLINE LENDER, THE AGENT AND THE
BORROWER HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING
OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE
COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT OR IN CONNECTION WITH ANY COLLATERAL OR ANY LIEN OR BY
REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG
THE BORROWER, THE AGENT, THE SWINGLINE LENDER OR ANY OF THE LENDERS OF ANY KIND
OR NATURE.
(b) EACH OF THE BORROWER, THE AGENT, THE SWINGLINE LENDER AND EACH
LENDER HEREBY AGREES THAT THE FEDERAL DISTRICT COURT OF THE EASTERN DISTRICT OF
PENNSYLVANIA OR, AT THE OPTION OF THE AGENT, ANY STATE COURT LOCATED IN
PHILADELPHIA COUNTY, PENNSYLVANIA, SHALL HAVE JURISDICTION TO HEAR AND DETERMINE
ANY CLAIMS OR DISPUTES BETWEEN OR AMONG THE BORROWER, THE AGENT, THE SWINGLINE
LENDER OR ANY OF THE LENDERS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS
AGREEMENT, THE LOANS AND LETTERS OF CREDIT, OR ANY OTHER LOAN DOCUMENT OR TO ANY
MATTER ARISING HEREFROM OR THEREFROM OR THE COLLATERAL. THE BORROWER AND EACH OF
THE LENDERS EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN
ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS.
(c) EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT
OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH
AGREES NOT TO PLEAD OR CLAIM THE SAME.
(d) THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED
TO PRECLUDE THE BRINGING OF ANY ACTION BY THE AGENT OR ANY LENDER OR THE
ENFORCEMENT BY THE AGENT OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN
ANY OTHER APPROPRIATE JURISDICTION.
(e) THE FOREGOING WAIVERS HAVE BEEN MADE WITH THE ADVICE OF COUNSEL AND
WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE
THE PAYMENT OF THE LOANS AND ALL OTHER OBLIGATIONS AND THE TERMINATION OF THIS
AGREEMENT.
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Section 13.5. Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns, except that the Borrower may not assign or otherwise transfer any of
its rights under, and no Person may assume any of the Borrower's obligations
under, this Agreement or any of the other Loan Documents without the prior
written consent of all of the Lenders.
(b) Any Lender may make, carry or transfer Loans at, to or for the
account of, any of its branch offices or the office of an affiliate of such
Lender except to the extent such transfer would result in increased costs to, or
taxes payable by or for the account of, the Borrower.
(c) Any Lender may at any time grant to one or more banks or other
financial institutions (each a "Participant") participating interests in its
Commitments or the Obligations owing to such Lender; provided, however, any such
participating interest must be for a constant percentage of a Lender's
Commitments and not a varying percentage interest. Except as otherwise provided
in Section 13.3., no Participant shall have any rights or benefits under this
Agreement or any other Loan Document. In the event of any such grant by a Lender
of a participating interest to a Participant, such Lender shall remain
responsible for the performance of its obligations hereunder, and the Borrower
and the Agent shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement. Any
agreement pursuant to which any Lender may grant such a participating interest
shall provide that such Lender shall retain the sole right and responsibility to
enforce the obligations of the Borrower hereunder including, without limitation,
the right to approve any amendment, modification or waiver of any provision of
this Agreement; provided, however, such Lender may agree with the Participant
that it will not, without the consent of the Participant, agree to any such
amendment, modification or waiver if it requires the consent of all of the
Lenders under Sections 13.6.(a), (b) or (d). An assignment or other transfer
which is not permitted by subsection (d) or (e) below shall be given effect for
purposes of this Agreement only to the extent of a participating interest
granted in accordance with this subsection (c). The selling Lender shall
promptly notify the Agent and the Borrower of the sale of any participation
hereunder and the terms thereof.
(d) Any Lender may with the prior written consent of the Agent and the
Borrower (provided, that the Borrower's consent shall not be required if a
Default or Event of Default shall have occurred and be continuing) which
consent, in each case, shall not be unreasonably withheld, assign to one or more
Eligible Assignees (each an "Assignee") all or a portion of such Lender's
Commitments and its other rights and obligations under this Agreement and such
Lender's Notes; provided, however, (i) no such consent by the Borrower or Agent
shall be required in the case of any assignment to another Lender or to any
affiliate of a Lender; (ii) any partial assignment shall be in an amount at
least equal to $10,000,000 and integral multiples of $1,000,000 in excess
thereof, and after giving effect to such assignment the assigning Lender retains
Commitments, or if the Commitments have been terminated, holds Notes having an
aggregate outstanding principal balance, of at least $10,000,000; (iii) after
giving effect to any such assignment by the Lender then acting as Agent, such
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Lender shall retain Commitments, or if the Commitments have been terminated,
hold Notes having an aggregate outstanding principal balance, greater than or
equal to the Commitments of each other Lender (other than any Lender whose
Commitments have increased as a result of a merger or combination with another
Lender); (iv) any such assignment must be of proportionate amounts of both
Commitments of such Lender (other than an assignment effected pursuant to
Section 2.15.(b)); (v) such Lender must give the Agent at least 10 days prior
written notice of any such assignment; and (vi) each such assignment shall be
effected by means of an Assignment and Acceptance Agreement. Upon execution and
delivery of such instrument and payment by such Assignee to such transferor
Lender of an amount equal to the purchase price agreed between such transferor
Lender and such Assignee, such Assignee shall be deemed to be a Lender party to
this Agreement as of the effective date of the Assignment and Acceptance
Agreement and shall have all the rights and obligations of a Lender with the
Commitments as set forth in such Assignment and Acceptance Agreement, and the
transferor Lender shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. Upon the consummation of any assignment pursuant to this subsection
(d), the transferor Lender, the Agent and the Borrower shall make appropriate
arrangements so that new Notes are issued to the Assignee and such transferor
Lender, as appropriate. In connection with any such assignment, the transferor
Lender shall pay to the Agent an administrative fee for processing such
assignment in the amount of $3,000.
(e) The Agent shall maintain a copy of each Assignment and Acceptance
Agreement delivered to and accepted by it and a register for the recordation of
the names and addresses of the Lenders and the Commitments of each Lender from
time to time (the "Register"). The Agent shall give each Lender and the Borrower
notice of the assignment by any Lender of its rights as contemplated by this
Section. The Borrower, the Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all purposes of this
Agreement and the other Loan Documents. The Register and copies of each
Assignment and Acceptance Agreement shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice to the Agent. Upon its receipt of an Assignment and
Acceptance Agreement executed by an assigning Lender, together with each Note
subject to such assignment (a "Surrendered Note"), the Agent shall, if such
Assignment and Acceptance Agreement has been completed and if the Agent receives
the processing and recording fee described in subsection (d) above, (i) accept
such Assignment and Acceptance Agreement, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof, and return each
Surrendered Note, to the Borrower.
(f) Notwithstanding anything in this Agreement to the contrary, and
without the need to comply with any of the formal or procedural requirements of
this Agreement, including this Section 13.5., any Lender may at any time and
from time to time pledge and assign all or any portion of its rights under all
or any of the Loan Documents to a Federal Reserve Bank; provided that no such
pledge or assignment shall release such Lender from its obligations thereunder.
To facilitate any such pledge or assignment, Agent shall, at the request of and
at the expense of such Lender, enter into a letter agreement with the Federal
Reserve Bank in, or substantially in, the form of the exhibit to Appendix C to
the Federal Reserve Bank of New York Operating Circular No. 10.
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(g) A Lender may furnish any information concerning the Borrower, any
other Loan Party or any of their respective Subsidiaries in the possession of
such Lender from time to time to Assignees and Participants (including
prospective Assignees and Participants) subject to compliance with Section 13.8.
(h) Anything in this Section to the contrary notwithstanding, no Lender
may assign or participate any interest in any Loan held by it hereunder to the
Borrower, any other Loan Party or any of their respective Affiliates or
Subsidiaries.
(i) Each Lender agrees that, without the prior written consent of the
Borrower and the Agent, it will not make any assignment hereunder in any manner
or under any circumstances that would require registration or qualification of,
or filings in respect of, any Loan or Revolving Note under the Securities Act or
any other securities laws of the United States of America or of any other
jurisdiction.
Section 13.6. Amendments.
Except as otherwise expressly provided in this Agreement, any consent
or approval required or permitted by this Agreement or in any Loan Document to
be given by the Lenders may be given, and any term of this Agreement or of any
other Loan Document (other than any fee letter solely between the Borrower and
the Agent) may be amended, and the performance or observance by the Borrower,
any other Loan Party or any other Subsidiary of any terms of this Agreement or
such other Loan Document (other than any fee letter solely between the Borrower
and the Agent) or the continuance of any Default or Event of Default may be
waived (either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Requisite Lenders
(and, in the case of an amendment to any Loan Document, the written consent of
each Loan Party which is party thereto). Notwithstanding the foregoing, no
amendment, waiver or consent shall, unless in writing, and signed by all of the
Lenders (or the Agent at the written direction of the Lenders), do any of the
following:
(a) increase the Commitments of the Lenders or subject the Lenders to
any additional obligations;
(b) reduce the principal of, or interest rates that have accrued or
that will be charged on the outstanding principal amount of, any Loans or other
Obligations;
(c) reduce the amount of any Fees payable to the Lenders hereunder;
(d) postpone any date fixed for any payment of any principal of,
interest on, or Fees with respect to, any Loans or any other Obligations;
(e) change the Construction Commitment Percentages, Revolving
Commitment Percentages or the Total Commitment Percentages (excluding any change
as a result of an assignment of Commitments permitted under Section 13.5.(d) or
any of the transactions permitted under Section 2.14.);
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(f) modify the definition of the terms "Construction Facility
Termination Date", "Construction Loan Maturity Date", "Revolving Credit
Termination Date" or "Termination Date";
(g) amend this Section or amend the definitions of the terms used in
this Agreement or the other Loan Documents insofar as such definitions affect
the substance of this Section;
(h) modify the definition of the term "Requisite Lenders" or modify in
any other manner the number or percentage of the Lenders required to make any
determinations or waive any rights hereunder or to modify any provision hereof;
(i) release any Guarantor or Construction Guarantor from its
obligations under the Guaranty or Construction Guaranty, respectively (except
for releases permitted under Sections 4.1.(g), 9.15.(c) and 9.16.(c));
(j) modify the terms of, or waive the Parent's compliance with, Section
10.1.(b);
(k) modify the definition of the terms "Appraised Value", "Borrowing
Base Value", "Construction Loan Limit" and "Permanent Loan Estimate" (and the
definitions used in such definitions and the percentages and rates used in the
calculation thereof);
(l) waive any condition to the acceptance of a Borrowing Base Property
or Construction Property set forth in Sections 4.1.(b) and (c) and 5.1.(a) and
(b), respectively; and
(m) waive a Default or Event of Default under subsection (a) of Section
11.1.
No amendment, waiver or consent unless in writing and signed by the Agent, in
addition to the Lenders required hereinabove to take such action, shall affect
the rights or duties of the Agent under this Agreement or any of the other Loan
Documents. Any amendment, waiver or consent relating to Section 2.3. or the
obligations of the Swingline Lender under this Agreement or any other Loan
Document shall, in addition to the Lenders required hereinabove to take such
action, require the written consent of the Swingline Lender. Further, no
Collateral shall be released or disposed of by the Agent unless all of the
Lenders so direct the Agent or unless released or disposed of as permitted by,
and in accordance with, Section 12.8., Sections 4.1.(g) or (h), or Sections
5.1.(e) or (f). No waiver shall extend to or affect any obligation not expressly
waived or impair any right consequent thereon and any amendment, waiver or
consent shall be effective only in the specific instance and for the specific
purpose set forth therein. No course of dealing or delay or omission on the part
of the Agent or any Lender in exercising any right shall operate as a waiver
thereof or otherwise be prejudicial thereto. Except as otherwise explicitly
provided for herein or in any other Loan Document, no notice to or demand upon
the Borrower shall entitle the Borrower to other or further notice or demand in
similar or other circumstances.
Section 13.7. Nonliability of Agent and Lenders.
The relationship between the Borrower, on the one hand, and the Lenders
and the Agent, on the other hand, shall be solely that of borrower and lender.
Neither the Agent nor any Lender shall have any fiduciary responsibilities to
the Borrower and no provision in this Agreement or in any of the other Loan
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Documents, and no course of dealing between or among any of the parties hereto,
shall be deemed to create any fiduciary duty owing by the Agent or any Lender to
any Lender, the Borrower, any Subsidiary or any other Loan Party. Neither the
Agent nor any Lender undertakes any responsibility to the Parent or the Borrower
to review or inform the Parent or the Borrower of any matter in connection with
any phase of the business or operations of the Parent or the Borrower.
Section 13.8. Confidentiality.
Except as otherwise provided by Applicable Law, the Agent and each
Lender shall utilize all non-public information obtained pursuant to the
requirements of this Agreement which has been identified as confidential or
proprietary by the Parent or the Borrower in accordance with its customary
procedure for handling confidential information of this nature and in accordance
with safe and sound banking practices but in any event may make disclosure: (a)
to any of their respective affiliates (provided any such affiliate shall agree
to keep such information confidential in accordance with the terms of this
Section); (b) as reasonably required by any bona fide Assignee, Participant or
other transferee in connection with the contemplated transfer of any Commitment
or participations therein as permitted hereunder (provided they shall agree to
keep such information confidential in accordance with the terms of this
Section); (c) as required by any Governmental Authority or representative
thereof or pursuant to legal process; (d) to the independent auditors and other
professional advisors (provided they shall be notified of the confidential
nature of the information of the Agent or any Lender and shall agree to keep
such information confidential in accordance with the terms of this Section); and
(e) after the happening and during the continuance of an Event of Default, to
any other Person, in connection with the exercise by the Agent or the Lenders of
rights hereunder or under any of the other Loan Documents. The Agent and each
Lender agrees to use any such non-public information solely in connection with
the transactions contemplated by this Agreement and the other Loan Documents.
Section 13.9. Indemnification.
(a) The Borrower shall and hereby agrees to indemnify, defend and hold
harmless the Agent, any affiliate of the Agent and each of the Lenders and their
respective directors, officers, shareholders, agents, employees and counsel
(each referred to herein as an "Indemnified Party") from and against any and all
losses, costs, claims, damages, liabilities, deficiencies, judgments or expenses
of every kind and nature (including, without limitation, amounts paid in
settlement, court costs and the fees and disbursements of counsel incurred in
connection with any litigation, investigation, claim or proceeding or any advice
rendered in connection therewith) (the foregoing items referred to herein as
"Claims and Expenses") incurred by an Indemnified Party in connection with,
arising out of, or by reason of, any suit, cause of action, claim, arbitration,
investigation or settlement, consent decree or other proceeding (the foregoing
referred to herein as an "Indemnity Proceeding") which is in any way related
directly or indirectly to: (i) this Agreement or any other Loan Document or the
transactions contemplated hereby or thereby; (ii) the making of any Loans or
issuance of Letters of Credit hereunder; (iii) any actual or proposed use by the
Borrower of the proceeds of the Loans or Letters of Credit; (iv) the Agent's or
any Lender's entering into this Agreement; (v) the fact that the Agent and the
Lenders have established the credit facility evidenced hereby in favor of the
Borrower; (vi) the fact that the Agent and the Lenders are creditors of the
Borrower and have or are alleged to have information regarding the financial
condition, strategic plans or business operations of the Parent, the Borrower
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and the other Subsidiaries; (vii) the fact that the Agent and the Lenders are
material creditors of the Borrower and are alleged to influence directly or
indirectly the business decisions or affairs of the Parent, the Borrower and the
other Subsidiaries or their financial condition; (viii) the exercise of any
right or remedy the Agent or the Lenders may have under this Agreement or the
other Loan Documents including, but not limited to, the foreclosure upon, or
seizure of, any Collateral or the exercise of any other rights of a secured
party; provided, however, that the Borrower shall not be obligated to indemnify
any Indemnified Party for any acts or omissions of such Indemnified Party in
connection with matters described in clause (i) and this clause (viii) to the
extent found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's gross negligence or
willful misconduct; or (ix) any violation or non-compliance by the Borrower or
any Subsidiary of any Applicable Law (including any Environmental Law)
including, but not limited to, any Indemnity Proceeding commenced by (A) the
Internal Revenue Service or state taxing authority or (B) any Governmental
Authority or other Person under any Environmental Law, including any Indemnity
Proceeding commenced by a Governmental Authority or other Person seeking
remedial or other action to cause the Borrower or its Subsidiaries (or its
respective properties) (or the Agent and/or the Lenders as successors to the
Borrower) to be in compliance with such Environmental Laws.
(b) The Borrower's indemnification obligations under this Section shall
apply to all Indemnity Proceedings arising out of, or related to, the foregoing
whether or not an Indemnified Party is a named party in such Indemnity
Proceeding. In this connection, this indemnification shall cover all costs and
expenses of any Indemnified Party in connection with any deposition of any
Indemnified Party or compliance with any subpoena (including any subpoena
requesting the production of documents). This indemnification shall, among other
things, apply to any Indemnity Proceeding commenced by other creditors of the
Borrower or any Subsidiary, any shareholder of the Borrower or any Subsidiary
(whether such shareholder(s) are prosecuting such Indemnity Proceeding in their
individual capacity or derivatively on behalf of the Borrower), any account
debtor of the Borrower or any Subsidiary or by any Governmental Authority. If
and to the extent that the obligations of the Borrower hereunder are
unenforceable for any reason, the Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of such obligations which is
permissible under Applicable Law. The Borrower's obligations hereunder are in
addition to, and not in substitution of, any other obligation in respect of
indemnification contained in this Agreement or any other Loan Document.
Section 13.10. Termination; Survival.
At such time as (a) all of the Commitments have been terminated, (b)
none of the Lenders and the Swingline Lender are obligated any longer under this
Agreement to make any Loans and the Agent is no longer obligated to issue
Letters of Credit hereunder and (c) all Obligations (other than obligations
which survive as provided in the following sentence) have been paid and
satisfied in full, this Agreement shall terminate. Notwithstanding any
termination of this Agreement, or of the other Loan Documents, the indemnities
to which the Agent, the Swingline Lender and the Lenders are entitled under the
provisions of Sections 12.7., 13.2. and 13.9. and any other provision of this
Agreement and the other Loan Documents, and the waivers of jury trial and
submission to jurisdictions contained in Section 13.4., shall continue in full
force and effect and shall protect the Agent, the Swingline Lender and the
Lenders against events arising after such termination as well as before.
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Section 13.11. Severability of Provisions.
Any provision of this Agreement which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective only to the
extent of such prohibition or unenforceability without invalidating the
remainder of such provision or the remaining provisions or affecting the
validity or enforceability of such provision in any other jurisdiction.
Section 13.12. GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA APPLICABLE TO CONTRACTS EXECUTED,
AND TO BE FULLY PERFORMED, IN SUCH COMMONWEALTH.
Section 13.13. Counterparts.
This Agreement and any amendments, waivers, consents or supplements may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed an original, but all of which counterparts together shall constitute but
one and the same instrument.
Section 13.14. Obligations with Respect to Loan Parties.
The obligations of the Borrower or the Parent to direct or prohibit the
taking of certain actions by the other Loan Parties as specified herein shall be
absolute and not subject to any defense the Borrower or the Parent may have that
the Borrower or the Parent does not control such Loan Parties.
Section 13.15. Limitation of Liability.
Neither the Agent, the Swingline Lender, any Lender, nor any affiliate,
officer, director, employee, attorney, or agent of the Agent, the Swingline
Lender or any Lender shall have any liability with respect to, and the Borrower
and the Parent each hereby waives, releases, and agrees not to xxx any of them
upon, any claim for any special, indirect, incidental, or consequential damages
suffered or incurred by the Borrower or the Parent in connection with, arising
out of, or in any way related to, this Agreement or any of the other Loan
Documents, or any of the transactions contemplated by this Agreement or any of
the other Loan Documents. The Borrower and the Parent each hereby waives,
releases, and agrees not to xxx the Agent, the Swingline Lender or any Lender or
any of their respective affiliates, officers, directors, employees, attorneys,
or agents for punitive damages in respect of any claim in connection with,
arising out of, or in any way related to, this Agreement or any of the other
Loan Documents, or any of the transactions contemplated by this Agreement or
financed hereby. Notwithstanding anything in this Section to the contrary, no
Defaulting Lender shall be entitled to claim any of the benefits of this
Section.
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Section 13.16. Entire Agreement.
This Agreement and the other Loan Documents referred to herein embody
the final, entire agreement among the parties hereto and supersede any and all
prior commitments, agreements, representations, and understandings, whether
written or oral, relating to the subject matter hereof and may not be
contradicted or varied by evidence of prior, contemporaneous, or subsequent oral
agreements or discussions of the parties hereto. There are no oral agreements
among the parties hereto.
Section 13.17. Construction.
The Borrower, the Parent, the Agent, the Swingline Lender and each
Lender acknowledge that each of them has had the benefit of legal counsel of its
own choice and has been afforded an opportunity to review this Agreement and the
other Loan Documents with its legal counsel and that this Agreement and the
other Loan Documents shall be construed as if jointly drafted by the Borrower,
the Parent, the Agent, the Swingline Lender and each Lender.
Section 13.18. Time of the Essence.
Time is of the essence of each and every provision of this Agreement.
Section 13.19. NO NOVATION.
THE EXISTING CREDIT AGREEMENT IS BEING AMENDED AND RESTATED IN ITS
ENTIRETY BY THIS AGREEMENT FOR THE CONVENIENCE OF THE PARTIES. THIS AGREEMENT
MERELY AMENDS, MODIFIES AND RESTATES THE INDEBTEDNESS, LIABILITIES AND
OBLIGATIONS EVIDENCED BY THE EXISTING CREDIT AGREEMENT AND THE OTHER LOAN
DOCUMENTS (AS DEFINED IN THE EXISTING CREDIT AGREEMENT) AND DOES NOT CONSTITUTE,
AND IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT THIS AGREEMENT DOES NOT
EFFECT, A NOVATION OF THE EXISTING INDEBTEDNESS, LIABILITIES AND OBLIGATIONS
OWING BY THE BORROWER PURSUANT TO THE EXISTING CREDIT AGREEMENT. ALL SUCH
INDEBTEDNESS, LIABILITIES AND OBLIGATIONS CONTINUE TO REMAIN OUTSTANDING AND
EVIDENCED BY THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
[Signatures on Next Page]
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IN WITNESS WHEREOF, the parties hereto have caused this Credit
Agreement to be executed by their authorized officers all as of the day and year
first above written.
PREIT ASSOCIATES, L.P.
By: Pennsylvania Real Estate Investment Trust,
its general partner
By: /s/ Xxxxxxx X. Xxxx
---------------------------------------
Name: Xxxxxxx X. Xxxx
Title: Senior VP
PENNSYLVANIA REAL ESTATE INVESTMENT TRUST
By: /s/ Xxxxxxx X. Xxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxx
Title: Senior VP
[Signatures Continued on Next Page]
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[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
XXXXX FARGO BANK, NATIONAL ASSOCIATION, as
Agent, as the Swingline Lender and as a Lender
By: /s/ Xxxx X. Xxxxx
-------------------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
Revolving Commitment Amount: $52,500,000.00
Construction Commitment Amount: $22,500,000.00
Lending Office (all Types of Loans):
0000 X Xxxxxx XX, Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Address for Notices:
0000 X Xxxxxx XX, Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Xxxxx Fargo Bank, National Association
Real Estate Group
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Credit Officer
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
[Signatures Continued on Next Page]
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[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
U.S. BANK NATIONAL ASSOCIATION, a national
banking association
By: /s/ Xxxx X. Xxxx
-------------------------------------------
Name: Xxxx X. Xxxx
Title: Vice President
Revolving Commitment Amount: $24,500,000.00
Construction Commitment Amount: $10,500,000.00
Lending Office (all Types of Loans):
000 X. Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx Xxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Address for Notices:
000 X. Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
[Signatures Continued on Next Page]
-110-
[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
MANUFACTURERS & TRADERS TRUST COMPANY
By: /s/ Xxxx Xxxxxxxx
-------------------------------------------
Name: Xxxx Xxxxxxxx
Title: Vice President
Revolving Commitment Amount: $17,500,000.00
Construction Commitment Amount: $7,500,000.00
Lending Office (all Types of Loans):
Xxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000-0000
Attn: Xxxxx Xxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Address for Notices:
000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
[Signatures Continued on Next Page]
-111-
[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
FLEET NATIONAL BANK
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
Revolving Commitment Amount: $14,000,000.00
Construction Commitment Amount: $6,000,000.00
Lending Office (all Types of Loans):
00 Xxxxx 00 Xxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attn: Xxxxx X. Xxxxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Address for Notices:
00 Xxxxx 00 Xxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attn: Xxx Xxxxx Xxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
[Signatures Continued on Next Page]
-112-
[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
FIRSTRUST BANK
By: /s/ Xxxx X. Xxxxx
-------------------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
Revolving Commitment Amount: $14,000,000.00
Construction Commitment Amount: $6,000,000.00
Lending Office (all Types of Loans):
Xxxxxx & Xxxxxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxx Xxxxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Address for Notices:
00 X. Xxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxxx/Xxx Xxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
[Signatures Continued on Next Page]
-113-
[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
SOVEREIGN BANK
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
Revolving Commitment Amount: $14,000,000.00
Construction Commitment Amount: $6,000,000.00
Lending Office (all Types of Loans):
0 Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxx X. Xxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Address for Notices:
0 Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
[Signatures Continued on Next Page]
-114-
[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
SUMMIT BANK
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------------
Name:
Title:
Revolving Commitment Amount: $14,000,000.00
Construction Commitment Amount: $6,000,000.00
Lending Office (all Types of Loans):
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxxx Xxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Address for Notices:
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
[Signatures Continued on Next Page]
-115-
[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
WILMINGTON TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
Revolving Commitment Amount: $14,000,000.00
Construction Commitment Amount: $6,000,000.00
Lending Office (all Types of Loans):
000 X. Xxxxxxxxx Xxxxxx, Xxxxx 0
Xxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxx Arms
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Address for Notices:
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxx Xxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
[Signatures Continued on Next Page]
-116-
[Signature Page to Credit Agreement dated as of
December 28, 2000 with PREIT Associates, L.P.]
COMMERCE BANK, N.A.
By: /s/ Xxxx X. XxXxxxxxx
-------------------------------------------
Name: Xxxx X. XxXxxxxxx
Title: Senior Vice President
Revolving Commitment Amount: $10,500,000.00
Construction Commitment Amount: $4,500,000.00
Lending Office (all Types of Loans):
0000 Xxxxxxx Xxxxxxxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attn: Xxx Xxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000 Ext. 8570
Address for Notices:
0000 Xxxxx 00 Xxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attn: Xxxx X. XxXxxxxxx/Xxxxx Xxxxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
-117-
ANNEX I
DEFINED TERMS
"Accession Agreement" means an Accession Agreement substantially in the
form of Annex I to the Guaranty or the Construction Guaranty, as applicable.
"Additional Costs" has the meaning given that term in Section 6.1.
"Adjusted EBITDA" means, for any given period, (a) the EBITDA of the
Parent and its Subsidiaries determined on a consolidated basis for such period
minus (b) an amount equal to the sum of (A) the Reserve for Replacements for all
Properties owned by the Parent or any of its Subsidiaries plus (B) the greater
of the Parent's (i) Ownership Share or (ii) Recourse Share of the Reserve for
Replacements for all Properties owned by Unconsolidated Affiliates.
"Affiliate" means any Person (other than the Agent or any Lender): (a)
directly or indirectly controlling, controlled by, or under common control with,
the Borrower; (b) directly or indirectly owning or holding five percent (5.0%)
or more of any equity interest in the Borrower; or (c) five percent (5.0%) or
more of whose voting stock or other equity interest is directly or indirectly
owned or held by the Borrower. For purposes of this definition, "control"
(including with correlative meanings, the terms "controlling", "controlled by"
and "under common control with") means the possession directly or indirectly of
the power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities or by contract or
otherwise. The Affiliates of a Person shall include any officer or director (or
other Persons holding similar positions) of such Person.
"Agent" means Xxxxx Fargo Bank, National Association, as contractual
representative for the Lenders under the terms of this Agreement, and any of its
successors.
"Agreement Date" means the date as of which this Agreement is dated.
"Anchor Lease" means, with respect to a Property, a Lease whereby a
tenant leases 40,000 or more of the net rentable square footage of such Property
at the time of determination.
"Anchor Tenant" means, with respect to a Property, a tenant under an
Anchor Lease.
"Applicable Law" means all applicable provisions of constitutions,
statutes, rules, regulations and orders of all governmental bodies and all
orders and decrees of all courts, tribunals and arbitrators.
"Applicable Margin" means (a) 1.95% with respect to Construction
Advances and (b) with respect to Revolving Loans and Term Loans, means the
percentage rate set forth below corresponding to the ratio of Total Liabilities
to Gross Asset Value as determined in accordance with Section 10.1.(b) in effect
at such time:
I-1
--------------------------------------------------------------------------------
Ratio of Total Liabilities to
Level Gross Asset Value Applicable Margin
--------------------------------------------------------------------------------
1 Less than or equal to 0.40 to 1.00 1.30%
--------------------------------------------------------------------------------
2 Greater than 0.40 to 1.00 but less than 1.50%
or equal to 0.50 to 1.00
--------------------------------------------------------------------------------
3 Greater than 0.50 to 1.00 but less than 1.65%
or equal to 0.60 to 1.00
--------------------------------------------------------------------------------
4 Greater than 0.60 to 1.00 but less than 1.80%
or equal to .65 to 1.00
--------------------------------------------------------------------------------
The Applicable Margin for Revolving Loans and Term Loans shall be determined by
the Agent from time to time, based on the ratio of Total Liabilities to Gross
Asset Value as set forth in the Pricing Certificate most recently delivered by
the Borrower pursuant to Section 9.1.(h). Any adjustment to such Applicable
Margin shall be effective (i) in the case of a Pricing Certificate delivered in
connection with quarterly financial statements of the Parent delivered pursuant
to Section 9.1.(a), as of the date 45 days following the end of the last day of
the applicable fiscal period covered by such Pricing Certificate, and (ii) in
the case of a Pricing Certificate delivered in connection with annual financial
statements of the Parent delivered pursuant to Section 9.1.(b), as of the date
120 days following the end of the last day of the applicable fiscal period
covered by such Pricing Certificate. Notwithstanding the foregoing, for the
period from the Effective Date through but excluding the date on which the Agent
first determines the Applicable Margin for Revolving Loans as set forth above,
such Applicable Margin shall equal 1.65%. Thereafter, such Applicable Margin
shall be adjusted from time to time as set forth above.
"Appraisal" means, with respect to any Property, an M.A.I. appraisal
commissioned by and addressed to the Agent (acceptable to the Agent as to form,
substance and appraisal date), prepared by a professional appraiser acceptable
to the Agent, having at least the minimum qualifications required under
Applicable Law governing the Agent and the Lenders, including without
limitation, FIRREA, and determining both the "as is" market value of such
Property as between a willing buyer and a willing seller and the "stabilized
value" of such Property.
"Appraised Value" means, (a) with respect to any Borrowing Base
Property, the "as is" market value of such Property and (b) with respect to any
Construction Property, the "stabilized value" of such Property, each as
reflected in the most recent Appraisal of such Property as the same may have
been reasonably adjusted by the Agent based upon its internal review of such
Appraisal which adjustment is based on criteria and factors then generally used
and considered by the Agent in determining the value of similar real estate
projects, which review shall be conducted prior to acceptance of such Appraisal
by the Agent or, if such Appraisal is being reviewed in connection with any
other provision hereof, within ten (10) Business Days of receipt of such
Appraisal. Following the Stabilization Date of a Borrowing Base Property, the
Appraised Value of such Property shall be such "stabilized value" as the same
may have been adjusted by the Agent as provided above.
I-2
"Approved Joint Venture" means an Unconsolidated Affiliate of the
Borrower which satisfies the following requirements: (a) 50% of the total Equity
Interests of such Unconsolidated Affiliate are owned, directly or indirectly, by
the Borrower and (b) the Borrower, directly or indirectly, maintains a level of
control over the operations and management of such Unconsolidated Affiliate,
including without limitation, having the right to take the actions described in
clause (c)(ii) of the definition of Borrowing Base Property, which level of
control has been established in a manner reasonably satisfactory to the Agent
and its counsel.
"Approved Leases" means Leases for all or a portion of premises within
a Property that, at the time such Property is first encumbered by a Security
Deed, are approved as to form and content by the Requisite Lenders (which must
include the Lender then acting as Agent), including, but not limited to, early
termination rights of the tenant, co-tenancy and continuous operation
provisions, and subordination, non-disturbance and attornment language, and
containing economic terms and conditions not less favorable than the approved
leasing pro forma for the applicable Property (including, but not limited to,
minimum lease term, minimum effective base rent, expense recovery, and tenant
improvement/concession package). The following are also applicable:
(a) An Approved Lease shall cease to be an Approved Lease if
(i) the tenant thereunder is insolvent or seeks bankruptcy protection
and the Agent has not given its approval for said Lease to continue as
an Approved Lease (or revoked such approvals); (ii) the tenant
thereunder is insolvent or seeks bankruptcy protection and any monetary
default or material non-monetary default (other than insolvency or
bankruptcy) has occurred and is continuing under such Approved Lease
and the Requisite Lenders (including the Lender then acting as the
Agent) have not given their written approvals for said Lease to
continue as an Approved Lease (or revoked such approvals); (iii) if a
monetary default or a material non-monetary default has occurred and is
continuing under such Approved Lease and the Agent has not given its
approval for said Lease to continue as an Approved Lease (or revoked
such approval); or (iv) if the Approved Lease has been modified without
approval as provided below; or (v) if the Approved Lease has been
terminated.
(b) "Approved Leases" shall also include any Minor Lease and
any other Lease entered into after the date such Property is first
encumbered by a Security Deed, which covers all or a portion of
premises within a Property and (i) if said Lease (other than a Minor
Lease) would not constitute a Major Lease or an Anchor Lease, which
meets the economic terms in the Appraisal of said Property as approved
by the Agent, including without limitation the term, pro forma rent,
free rent, tenant improvements and tenant improvement allowance,
cotenancy provisions and continuous operations provisions, and (ii) if
said Lease would constitute a Major Lease or would not constitute a
Major Lease (other than a Minor Lease) but does not comply with the
provisions of the preceding clause (i), which is approved as to form
and content by the Agent, including, but not limited to, all the terms,
conditions and provisions enumerated in the first sentence of this
definition, and (iii) if said Lease would constitute an Anchor Lease,
which is approved as to form and content by the Requisite Lenders
(which must include the Lender then acting as Agent), including, but
not limited to, all the terms, conditions and provisions enumerated in
the first sentence of this definition.
I-3
(c) An Approved Lease (other than a Minor Lease) shall cease
to be an Approved Lease if any modification, extension, amendment, or
other change thereto is made and (i) if said Lease is not a Major Lease
or an Anchor Lease, such modification, extension, amendment or other
change causes said Lease to be out of conformity with the economic
terms in the Appraisal of said Property as approved by the Agent,
including without limitation the term, pro forma rent, free rent,
tenant improvements and tenant improvement allowance, cotenancy
provisions and continuous operations provisions, or (ii) if said Lease
is a Major Lease, such modification, extension, amendment or other
change is a Material Modification and is not approved as to form and
content by the Agent, or (iii) if said Lease is an Anchor Lease, such
modification, extension, amendment or other change is a Material
Modification and is not approved as to form and content by the
Requisite Lenders (which must include the Lender then acting as Agent).
A "Material Modification" means, solely for purposes of the definition
of "Approved Leases", any modification, extension, amendment or other
change to a Lease which (1) adds asbestos, environmental, or hazardous
substances representations, warranties, or indemnifications from the
landlord thereunder, or adds a purchase option, right of first refusal
to purchase, or option to expand the Improvements in favor of the
tenant, (2) permits the tenant any right of offset, abatement or
defense against the payment of rent, (3) grants the tenant any right to
terminate the Lease prior to expiration of the term thereof, (4)
permits the assignment or sublease by tenant with tenant being released
from liability with respect to the assigned or sublet space, (5) limits
the Agent's right to cure defaults by the landlord under the Lease, (6)
modifies any non-recourse provisions relating to landlord's liability
under the Lease, unless, in any instance, these provisions would not be
applicable to the Agent, or (7) decreases the rent, additional rent, or
other amounts payable thereunder, or modifies the term, renewal,
extension or expansion rights, liability of the landlord thereunder, or
continuous operations provisions, or increases concessions or tenant
improvement allowances or monetary or maintenance obligations of
landlord thereunder.
(d) If any proposed modification, extension, amendment, or
other change to an Approved Lease or any new Lease for which the
Agent's approval is required or sought under this definition is
submitted to the Agent for its approval in accordance with the
following sentence of this paragraph and the Agent has not responded to
the Borrower within ten (10) days after the Agent's receipt thereof,
such proposed modification, extension, amendment, or other change to an
Approved Lease or any new Lease shall be deemed approved by the Agent.
The requirements for the Agent's approval to be deemed given under this
clause (d) are that the Borrower's written request for approval must
include a copy of the proposed modification, extension, amendment, or
other change to an Approved Lease or any new Lease and must expressly
state in some clear and conspicuous fashion (whether in boldface,
underlined or ALL CAPITALIZED TYPEFACE) in an accompanying cover letter
that such proposed modification, extension, amendment, or other change
to an Approved Lease or such new Lease will be deemed approved by the
Agent if the Agent does not make written response to the Borrower
within ten (10) days after the Agent's receipt thereof.
I-4
(e) If any proposed modification, extension, amendment, or
other change to an Approved Lease or any new Lease for which the
Requisite Lenders' approval is required or sought under this definition
is submitted to the Requisite Lenders for their approval in accordance
with the following sentence of this paragraph and any of the Requisite
Lenders have not responded to the Borrower within ten (10) days after
such Lender's receipt thereof, such proposed modification, extension,
amendment, or other change to an Approved Lease or any new Lease shall
be deemed approved by said Lender(s). The requirements for any of the
Lenders' approval to be deemed given under this clause (e) are that the
Borrower's written request for approval must include a copy of the
proposed modification, extension, amendment, or other change to an
Approved Lease or any new Lease and must expressly state in some clear
and conspicuous fashion (whether in boldface, underlined or ALL
CAPITALIZED TYPEFACE) in an accompanying cover letter that such
proposed modification, extension, amendment, or other change to an
Approved Lease or such new Lease will be deemed approved by such Lender
if such Lender does not make written response to the Borrower within
ten (10) days after said Lender's receipt thereof.
"Approved Project Costs" means, with respect to any Construction
Property, the aggregate amount of hard and soft project costs with respect to
such Construction Property as set forth in the approved Cost Breakdown, as
approved by the Requisite Lenders (which must include the Lender then acting as
Agent) in writing, and as changed from time to time pursuant to Permitted Change
Orders, and as the same may be changed by other modifications approved by the
Agent which do not in the aggregate increase or decrease total Approved Project
Costs by more than 10% (in which event, said change must be approved by the
Requisite Lenders).
"Architect" means the architect for a Construction Property, as
approved by the Agent.
"Architect's Contract" means, with respect to any Construction
Property, the agreement(s) between the Borrower (or the Subsidiary Borrower
which owns such Construction Property) and the Architect with respect to the
Plans and Improvements for such Construction Property, as approved by the Agent,
and any and all modifications or amendments thereof, as approved by the Agent.
"Assignee" has the meaning given that term in Section 13.5.(d).
"Assignment and Acceptance Agreement" means an Assignment and
Acceptance Agreement among a Lender, an Assignee and the Agent, substantially in
the form of Exhibit F.
"Assignment of Leases and Rents" means an Assignment of Leases and
Rents executed by the Borrower or a Subsidiary (or Subsidiary Borrower, as
applicable) in favor of the Agent for the benefit of the Lenders, substantially
in the form of Exhibit G or otherwise in form and substance satisfactory to the
Agent.
"Base Rate" means the greater of (a) the rate of interest per annum
publicly announced from time to time by the Agent at its principal office in San
Francisco, California as its "prime rate" (which rate of interest may not be the
lowest rate charged by the Agent or any of the Lenders on similar loans) and (b)
the Federal Funds Rate plus one-half of one percent (0.5%). Each change in the
I-5
Base Rate shall become effective without prior notice to the Borrower or the
Lenders automatically as of the opening of business on the date of such change
in the Base Rate.
"Base Rate Loan" means a Revolving Loan, Term Loan or Construction
Advance bearing interest at a rate based on the Base Rate.
"Benefit Arrangement" means at any time an employee benefit plan within
the meaning of Section 3(3) of ERISA which is not a Benefit Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Benefit Plan" means at any time an employee pension benefit plan
(other than a Multiemployer Plan) which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code and either (i) is maintained, or contributed to, by any member of
the ERISA Group for employees of any member of the ERISA Group or (ii) has at
any time within the preceding five years been maintained, or contributed to, by
any Person which was at such time a member of the ERISA Group for employees of
any Person which was at such time a member of the ERISA Group.
"Blue Route" means, collectively, Metroplex West Associates, L.P. and
Metroplex East Associates, L.P., each Pennsylvania limited partnerships, (a)
which own certain real property and improvements located in Plymouth Township,
Xxxxxxxxxx County, Pennsylvania, (b) which have obtained $76,350,000 of
construction financing for the purposes of financing of construction of certain
improvements located on such real property, and (c) of which (i) the Borrower is
one of the limited partners and (ii) certain Wholly Owned Subsidiaries of the
Borrower are some of the general partners.
"Borrower" has the meaning set forth in the introductory paragraph
hereof and shall include the Borrower's successors and permitted assigns.
"Borrowing Base" means an amount equal to lesser of (a) 70% of the
aggregate sum of the Appraised Values of all Borrowing Base Properties and (b)
the aggregate sum of the Permanent Loan Estimates of all Borrowing Base
Properties as determined and adjusted from time to time in accordance with
Section 4.1.(b) and (c). With respect to Borrowing Base Properties which are
owned by Subsidiaries that are not Wholly Owned Subsidiaries, to the extent the
Borrowing Base Values of such Properties would exceed 50% of the Borrowing Base
such excess shall be excluded from the Borrowing Base. Further, to the extent
the Borrowing Base Value of any one Property would exceed 30% of the Borrowing
Base such excess shall be excluded from the Borrowing Base unless otherwise
consented to by the Requisite Lenders in writing; provided, however, with
respect to the Property known as "North Dartmouth Mall", (x) the amount of the
Borrowing Base attributable to such Property may exceed 30% but such amount may
never exceed 35% of the Borrowing Base and if such amount shall decrease, such
amount may not increase thereafter and (y) once the amount of the Borrowing Base
attributable to such Property is equal to or less than 30%, this proviso shall
no longer apply. During any period that the number of Borrowing Base Properties
is less than 5, the Borrowing Base shall equal $0 unless otherwise consented to
by the Requisite Lenders in writing.
I-6
"Borrowing Base Certificate" means a report in substantially the form
of Exhibit H, certified by the chief financial officer of Parent, setting forth
the calculations required to establish the Borrowing Base, all in form and
detail satisfactory to the Agent.
"Borrowing Base Property" means a Property which satisfies all of the
following requirements as confirmed by the Agent:
(a) such Property is owned in fee simple by the Parent, the Borrower or
a Subsidiary of the Borrower or an Approved Joint Venture or, if such Property
is not owned in fee simple by the Parent, the Borrower, a Subsidiary of the
Borrower or an Approved Joint Venture, the Lease underlying such Property
contains terms and mortgagee protection provisions acceptable to the Agent,
including without limitation those provisions described in Section 5.1.(c)(ix),
unless any such provisions are modified or waived by the Agent,;
(b) such Property is not subject to a Negative Pledge or any Lien other
than Permitted Liens;
(c) if such Property is owned by a Subsidiary or an Approved Joint
Venture of the Borrower, (i) none of the Borrower's or the Parent's direct or
indirect ownership interest in such Subsidiary or Approved Joint Venture is
subject to any Negative Pledge (other than a Negative Pledge under the Loan
Documents in favor of the Agent for its benefit or the benefit of the Lenders)
or a Lien other than Permitted Liens and (ii) the Borrower directly, or
indirectly through a Subsidiary, has the right to take the following actions
without the need to obtain the consent of any Person: (A) to create Lien on such
Property as security for Indebtedness of the Parent, the Borrower, such
Subsidiary or such Approved Joint Venture, as applicable and (B) to sell,
transfer or otherwise dispose of such Property;
(d) such Property has an Occupancy Rate of at least 70% unless
otherwise consented to by the Requisite Lenders (including the Lender then
acting as Agent) in writing; provided, however, if the Occupancy Rate of a
Property which satisfies all other requirements to qualify as a Borrowing Base
Property shall be less than 70% but greater than 50%, then such Property shall
remain a Borrowing Base Property for purposes of this clause (d) for a period
not to exceed one year from the date on which the Occupancy Rate fell below 70%
so long as (i) no other Property is a Borrowing Base Property as a result of
this application of this proviso and (ii) the Occupancy Rate of such Property
always exceeds 50%.
(e) such Property is not a Development Property or a Major
Redevelopment Property; provided, however, the requirements of this clause shall
not apply to the Properties known as "North Dartmouth Mall" and "Northeast Tower
Center" at any time prior to March 31, 2001 and June 30, 2001, respectively;
provided, further, however, if on June 30, 2001, the Northeast Tower Center
Property will not comply with the requirements if this clause, then such
Property may be subdivided, the portion of such Property on which the Bradlees
store is located may be released from the applicable Security Documents, and the
remaining portion of the Northeast Tower Center Property remain a Borrowing Base
I-7
Property so long as such remaining portion would satisfy all conditions to being
a Borrowing Base Property;
(f) pursuant to Section 4.1.(a), (b), (c) and (e), as applicable, the
Agent and the Requisite Lenders have agreed to include such Property in
calculations of the Borrowing Base; and
(g) all items required under Section 4.1. to be executed and delivered
in connection with such Property have been so executed and delivered.
A Property shall cease to be a Borrowing Base Property if it shall cease to
satisfy any of the requirements of being a Borrowing Base Property.
"Borrowing Base Value" means, with respect to a Borrowing Base
Property, that portion of the Borrowing Base attributable to such Borrowing Base
Property.
"Business Day" means (a) any day other than a Saturday, Sunday or other
day on which banks in Washington, D.C. or San Francisco, California are
authorized or required to close and (b) with reference to a LIBOR Loan, any such
day that is also a day on which dealings in Dollar deposits are carried out in
the London interbank market.
"Capitalized Lease Obligation" means obligations under a lease that is
required to be capitalized for financial reporting purposes in accordance with
GAAP. The amount of a Capitalized Lease Obligation is the capitalized amount of
such obligation determined in accordance with GAAP.
"Cash Equivalents" means: (a) securities issued, guaranteed or insured
by the United States of America or any of its agencies with maturities of not
more than one year from the date acquired; (b) certificates of deposit with
maturities of not more than one year from the date acquired issued by a United
States federal or state chartered commercial bank of recognized standing, which
has capital and unimpaired surplus in excess of $500,000,000 and which bank or
its holding company has a short-term commercial paper rating of at least A-1 or
the equivalent by S&P or at least P-1 or the equivalent by Xxxxx'x; (c) reverse
repurchase agreements with terms of not more than seven days from the date
acquired, for securities of the type described in clause (a) above and entered
into only with commercial banks having the qualifications described in clause
(b) above; (d) commercial paper issued by any Person incorporated under the laws
of the United States of America or any State thereof and rated at least A-1 or
the equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Xxxxx'x, in each case with maturities of not more than one year from the date
acquired; and (e) investments in money market funds registered under the
Investment Company Act of 1940, which have net assets of at least $500,000,000
and at least 85% of whose assets consist of securities and other obligations of
the type described in clauses (a) through (d) above.
"Collateral" means any real or personal property directly or indirectly
securing any of the Obligations or any other obligation of a Person under or in
respect of any Loan Document to which it is a party, and includes without
limitation all "Mortgaged Property" under and as defined in any Security Deed,
all "Assigned Contracts" as defined in any Property Management Contract
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Assignment, all "Leases and Rents" as defined in any Assignment of Leases and
Rents and all other property subject to a Lien created by a Security Document
relating to a Borrowing Base Property or a Construction Property.
"Commitment" means a Lender's Revolving Commitment or Construction
Commitment.
"Completion Date" means, for any Construction Property, the date agreed
to by the Agent and the Borrower in the Disbursement Schedule applicable to such
Construction Property prior to the initial disbursement of any Construction
Advances with respect to such Construction Property.
"Completion of the Improvements" means, as to any Construction
Property, the time when Improvements for a Construction Property (or portion
thereof then scheduled to be completed) have been substantially completed in
accordance with the Plans, the Major Leases and Anchor Leases and the provisions
of Article V., and all of the following have been delivered to the Agent in form
and substance satisfactory to the Agent: (i) Certificate of Occupancy (or its
equivalent) from the appropriate Governmental Authority having jurisdiction over
the Construction Property; (ii) an AIA Certificate of Substantial Completion
from the Architect; (iii) an endorsement from the Title Company deleting any
exception in the Title Insurance Policy relating to Completion of the
Improvements and other exceptions specified by the Agent which may be deleted
pursuant to applicable regulations; (iv) an affidavit and full release of liens
in recordable form from the General Contractor and the Architect, and, upon
request of the Agent, any other contractors or subcontractors who have performed
work on, or furnished materials for, the Improvements on such Construction
Property; and (v) after the issuance of the aforesaid certificate from the
Architect any and all "punch list" items or other items which remain to be
completed have been fully and finally completed.
"Compliance Certificate" has the meaning given that term in Section
9.1.(c).
"Constant Carried Percentage" means, with respect to a Construction
Property (or Property being considered as a Construction Property), the ratio,
expressed as a percentage, of (a) the Net Operating Income for such Property
determined on a pro forma basis using (i) rents payable under the Approved
Leases for the one-year period commencing on the projected stabilization date
and (ii) projected expenses during such period to (b) the amount of the
Construction Loan Limit for such Property.
"Construction Advance" means a loan made by a Lender to the Borrower
under Article V., with respect to a Construction Property.
"Construction Commitment" means, as to each Lender, such Lender's
obligation to make Construction Advances pursuant to Article V. in an amount up
to, but not exceeding, the amount set forth for such Lender on its signature
page hereto as such Lender's "Construction Commitment Amount" or as set forth in
the applicable Assignment and Acceptance Agreement, as the same may be reduced
or increased from time to time pursuant to the terms of this Agreement.
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"Construction Commitment Percentage" means, as to each Lender, the
ratio, expressed as a percentage, of (a) the amount of such Lender's
Construction Commitment to (b) the aggregate amount of the Construction
Commitments of all Lenders hereunder; provided, however, that if at the time of
determination the Construction Commitments have terminated or been reduced to
zero, the "Construction Commitment Percentage" of each Lender shall be the
Construction Commitment Percentage of such Lender in effect immediately prior to
such termination or reduction.
"Construction Contracts" means, as to any Construction Property, the
General Contract, the Architect's Contract, and any and all contracts and
agreements, if any, written or oral, between the Borrower (or the Subsidiary
which owns such Construction Property) and any other contractor, engineer,
architect or supplier, and between any of the foregoing and any subcontractor
and between any of the foregoing and any other Person relating in any way to the
construction of the Improvements for such Construction Property, including the
performing of labor or the furnishing of standard or specially fabricated
materials in connection therewith.
"Construction Equity" means, with respect to a Construction Property,
the amount of equity required by the Agent to be invested by the Borrower or any
Subsidiary Borrower, as the case may be, for acquisition and development of such
Construction Property, from sources other than the Construction Advances, before
any Construction Advances will be disbursed with respect to such Construction
Property; provided, however, that the Agent may in its discretion in approving a
Cost Breakdown permit a portion of the Construction Equity to be invested after
Construction Advances have been made, such as, by way of example and not by way
of limitation, when a pad site within a Construction Property is subject to an
executed and binding sales contract acceptable to the Agent at the time such
Property becomes a Construction Property and said agreement and all deposits,
letters of credit and other assurances related thereto are assigned to the Agent
as security.
"Construction Facility Termination Date" means December 28, 2002.
"Construction Guarantor" means any Person that is party to any
Construction Guaranty as a "Guarantor" and shall in any event include the
Parent.
"Construction Guaranty" means each of the guaranties executed and
delivered pursuant to Section 5.1. and substantially in the form of Exhibit K-2.
"Construction Loan" means, with respect to a given Construction
Property, the aggregate portions of the Lenders' respective Construction
Commitments (whether or not utilized) allocated to such Construction Property in
an aggregate amount equal to the Construction Loan Limit established for such
Construction Property.
"Construction Loan Limit" means, with respect to a given Construction
Property (or Property being considered as a Construction Property), an amount
equal to the lesser of (a) 80.0% of the Approved Project Costs for such
Property, (b) 70.0% of the "stabilized value" of such Property as reflected in
the applicable Appraisal as such value may have been adjusted by the Agent as
provided in the definition of Appraised Value and (c) the Permanent Loan
Estimate for such Property.
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"Construction Loan Maturity Date" means, with respect to a Construction
Loan, (a) the date set forth as the "Construction Loan Maturity Date" in the
applicable Disbursement Schedule relating to such Construction Property which
shall be the date two years after the date set forth on the Construction Notes
executed in connection with such Construction Loan and (b) such later date to
which such date may be extended in accordance with Section 5.4.
"Construction Loan Security Documents" means, with respect to a
Construction Property, all Security Documents securing any amounts owing in
respect of any Construction Advances advanced with respect to such Construction
Property or any other amounts owing to the Agent or the Lenders with respect to
such Construction Property.
"Construction Note" has the meaning given such term in Section
2.11.(b).
"Construction Property" means a Property which (a) the Requisite
Lenders (including the Lender then acting as Agent) have agreed to deem a
Construction Property as provided in and subject to the provisions of Section
5.1.(a) and Section 5.1.(b), and (b) for which all of the applicable
requirements contained in Section 5.1.(c) have been satisfied.
"Construction Schedule" means, with respect to a Construction Property,
the construction schedule setting forth the anticipated starting dates and
completion dates of the various elements and categories of the work in
constructing, equipping and opening the Improvements for such Property,
including anticipated dates for funding of Construction Advances, as may be
modified from time to time with the approval of the Agent.
"Contingent Obligation" as applied to any Person, means any direct or
indirect liability, contingent or otherwise, of that Person with respect to any
Indebtedness, lease, dividend or other payment obligation of another Person if
the primary purpose or intent of the Person incurring such liability, or the
primary effect thereof, is to provide assurance to the obligee of such liability
that such liability will be paid or discharged, or that the holders of such
liability will be protected (in whole or in part) against loss with respect
thereto. Contingent Obligations shall include (i) any Guaranty of the
Indebtedness of another (other than of such Person for liabilities arising from
reasonable and customary exceptions to Nonrecourse Indebtedness, such as for
fraud, willful misrepresentation, misapplication of funds (including
misappropriation of security deposits and failure to apply rents to operating
expenses or debt service), indemnities relating to environmental matters and
waste of property constituting security for such Nonrecourse Indebtedness ,
post-default interest, attorney's fees and other costs of collection to the
extent not covered by the value of the property constituting security for such
Nonrecourse Indebtedness and other similar exceptions to recourse liability),
(ii) the obligation to make take-or-pay or similar payments if required
regardless of nonperformance by any other party or parties to an agreement, and
(iii) any liability of such Person for the Indebtedness of another through any
agreement to purchase, repurchase or otherwise acquire such obligation or any
property constituting security therefor, to provide funds for the payment or
discharge of such obligation or to maintain the solvency, financial condition or
any balance sheet item or level of income of another. The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
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guaranteed or otherwise supported or, if not a fixed and determined amount, the
maximum amount so guaranteed.
"Continue", "Continuation" and "Continued" each refers to the
continuation of a LIBOR Loan from one Interest Period to another Interest Period
pursuant to Section 2.9.
"Convert", "Conversion" and "Converted" each refers to the conversion
of a Loan of one Type into a Loan of another Type pursuant to Section 2.10.
"Cost Breakdown" means, with respect to any Construction Property, the
detailed trade breakdown of the cost of constructing the Improvements at such
Construction Property, and an itemization of non-construction and land costs,
including a line-item breakdown, as approved by the Requisite Lenders and as
changed from time to time pursuant to Permitted Change Orders, and as the same
may be changed by other modifications approved by the Agent which do not in the
aggregate increase or decrease total Approved Project Costs by more than 10% (in
which event, said change must be approved by the Requisite Lenders).
"Credit Event" means any of the following: (a) the making (or deemed
making) of any Loan, (b) the Conversion of a Loan and (c) the issuance of a
Letter of Credit.
"Credit Rating" means, for any Person, the lowest rating assigned by a
Rating Agency to each series of rated senior unsecured long term indebtedness of
such Person.
"Debt Service" means, with respect to a Person and for a given period,
(a) such Person's Interest Expense for the fiscal quarter most recently ended
plus (b) regularly scheduled principal payments on Indebtedness of such Person
during the fiscal quarter most recently ended, other than any balloon, bullet or
similar principal payment payable on any Indebtedness of such Person which
repays such Indebtedness in full plus (c) the greater of such Person's (i)
Ownership Share or (ii) Recourse Share of the amount of any payments of the type
described in the immediately preceding clause (b) of Unconsolidated Affiliates
of such Person.
"Debt Service Coverage Ratio" means, with respect to a Construction
Property, the ratio of (a) the Net Operating Income of such Property from
Approved Leases for the immediately preceding fiscal quarter of the Borrower
divided by (b) the product of (i) the Construction Loan Limit for such
Construction Property and (ii) the percent of a principal amount of a loan
required to be paid each year in order to repay the principal amount of such
loan in full based on a 25-year amortization, and to pay the amount of interest
due at each installment, utilizing a rate of interest equal to the greater of
(x) the rate most recently published in the United States Federal Reserve
Statistical Release (H.15) for 10-year Treasury Constant Maturities plus 2.0% or
(y) 8.50%, in equal monthly installments of principal and interest.
"Default" means any of the events specified in Section 11.1., whether
or not there has been satisfied any requirement for the giving of notice, the
lapse of time, or both.
"Defaulting Lender" has the meaning set forth in Section 3.10.
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"Development Property" means a Property (a) which is not a Major
Redevelopment Property; (b) either which is under development and either
construction has commenced or the owner of such Property (or an Affiliate) has
entered into a binding construction contract; and (c) either (i) which has not
achieved an Occupancy Rate of 85% or more or (ii) on which the improvements
(other than tenant improvements on unoccupied space) related to the development
have not been completed.
"Disbursement Request" means a written request for any disbursement of
Construction Advances with respect to a Construction Property, substantially in
the form of Exhibit I or in such other form as is acceptable to the Agent,
including such backup materials as may be requested by the Agent, and otherwise
in compliance with the applicable provisions of Article V. Each Disbursement
Request shall set forth the total amount incurred, expended and/or due for each
requested item less prior disbursements of Construction Advances, Construction
Equity, and the Supplemental Equity Deposit, if any, and a description of the
work performed, material supplied and/or costs incurred or due with respect to
each item for which disbursement of Construction Advances is requested.
"Disbursement Schedule" means, as to any Construction Property, the
agreement made by the Borrower (or Subsidiary Borrower, as applicable), based on
the form of Exhibit T or in such other form as is acceptable to the Agent, as
amended from time to time with the prior written approval of the Agent.
"Dollars" or "$" means the lawful currency of the United States of
America.
"EBITDA" means, with respect to any Person for any period and without
duplication, net earnings (loss) of such Person for such period (excluding
equity in net earnings or net loss of Unconsolidated Affiliates) plus the sum of
the following amounts (but only to the extent included in determining net
earnings (loss) for such period): (a) depreciation and amortization expense and
other non-cash charges of such Person for such period, plus (b) interest expense
of such Person for such period, plus (c) all provisions for any federal, state
or other income tax of such Person in respect of such period, minus (plus) (d)
extraordinary gains (losses) of such Person for such period, plus (e) the
greater of such Person's (i) Ownership Share or (ii) Recourse Share of the
EBITDA of the Unconsolidated Affiliates of such Person for such period. For
purposes of this definition, net earnings (loss) shall be determined before
minority interests and distributions to holders of Preferred Stock.
"Effective Date" means the later of: (a) the Agreement Date; and (b)
the date on which all of the conditions precedent set forth in Section 7.1.
shall have been fulfilled or waived in writing by the Agent.
"Eligible Assignee" means any Person who is: (i) currently a Lender;
(ii) a commercial bank, trust company, insurance company, investment bank or
pension fund organized under the laws of the United States of America, or any
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state thereof, and having total assets in excess of $5,000,000,000; (iii) a
savings and loan association or savings bank organized under the laws of the
United States of America, or any state thereof, and having a tangible net worth
of at least $500,000,000; or (iv) a commercial bank organized under the laws of
any other country which is a member of the Organization for Economic Cooperation
and Development ("OECD"), or a political subdivision of any such country, and
having total assets in excess of $10,000,000,000, provided that such bank is
acting through a branch or agency located in the United States of America. If
such Person is not currently a Lender, such Person's Credit Rating must be BBB
or higher by S&P, Baa2 or higher by Xxxxx'x, or the equivalent or higher of
either such Credit Rating by another Rating Agency acceptable to the Agent.
"Environmental Indemnity Agreement" means an Environmental Indemnity
Agreement executed by the Borrower in favor of the Agent and the Lenders and
substantially in the form of Exhibit J.
"Environmental Laws" means any Applicable Law relating to environmental
protection or the manufacture, storage, disposal or clean-up of Hazardous
Materials including, without limitation, the following: Clean Air Act, 42
U.S.C.ss.7401 et seq.; Federal Water Pollution Control Act, 33 U.S.C.ss.1251 et
seq.; Solid Waste Disposal Act, 42 U.S.C.ss.6901 et seq.; Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. ss. 9601 et
seq.; National Environmental Policy Act, 42 U.S.C.ss.4321 et seq.; regulations
of the Environmental Protection Agency and any applicable rule of common law and
any judicial interpretation thereof relating primarily to the environment or
Hazardous Materials.
"Equity Interest" means, with respect to any Person, any share of
capital stock of (or other ownership or profit interests in) such Person, any
warrant, option or other right for the purchase or other acquisition from such
Person of any share of capital stock of (or other ownership or profit interests
in) such Person, any security convertible into or exchangeable for any share of
capital stock of (or other ownership or profit interests in) such Person or
warrant, right or option for the purchase or other acquisition from such Person
of such shares (or such other interests), and any other ownership or profit
interest in such Person (including, without limitation, partnership, member or
trust interests therein), whether voting or nonvoting, and whether or not such
share, warrant, option, right or other interest is authorized or otherwise
existing on any date of determination.
"Equity Issuance" means any issuance or sale by a Person of any Equity
Interest.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
in effect from time to time.
"ERISA Group" means the Borrower, any Subsidiary and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
"Event of Default" means any of the events specified in Section 11.1.,
provided that any requirement for notice or lapse of time or any other condition
has been satisfied.
I-14
"Existing Credit Agreement" has the meaning set forth in the second
introductory paragraph hereof.
"Fair Market Value" means, with respect to any asset, the price which
could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of which is under pressure
or compulsion to complete the transaction. Fair Market Value shall be determined
by the Board of Directors of the Parent acting in good faith conclusively
evidenced by a board resolution thereof delivered to the Agent or, with respect
to any asset valued at up to $5,000,000, such determination may be made by the
chief financial officer of the Parent evidenced by an officer's certificate
delivered to the Agent.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward to the nearest 1/100th of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Business Day next succeeding such day,
provided that (a) if such day is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate quoted to the
Agent by federal funds dealers selected by the Agent on such day on such
transaction as determined by the Agent.
"Fees" means the fees and commissions provided for or referred to in
Section 3.6. (excluding fees payable under the last sentence of Section 3.6.(c)
and any fees referred to in Section 3.6.(h)).
"FIRREA" means the Financial Institution Recovery, Reform and
Enforcement Act of 1989, as amended.
"Floating Rate Indebtedness" means all Indebtedness of a Person which
bears interest at a variable rate during the scheduled life of such Indebtedness
and for which such Person has not obtained Interest Rate Agreements which
effectively cause such variable rates to be equivalent to fixed rates less than
or equal to 10.0% per annum.
"Funds From Operations" means, with respect to a Person and for a given
period, (a) net income (loss) of such Person determined on a consolidated basis
for such period minus (or plus) (b) gains (or losses) from debt restructuring
and sales of property during such period plus (c) depreciation with respect to
such Person's real estate assets and amortization (other than amortization of
deferred financing costs) of such Person for such period, all after adjustment
for unconsolidated partnerships and joint ventures. Adjustments for
unconsolidated entities will be calculated to reflect funds from operations on
the same basis.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
I-15
other entity as may be approved by a significant segment of the accounting
profession, which are applicable to the circumstances as of the date of
determination.
"General Contract" means, with respect to any Construction Property,
the agreement(s) between the Borrower (or the Subsidiary Borrower which owns or
leases such Construction Property) and the General Contractor with respect to
the Improvements for such Construction Property, as approved by the Agent, and
any and all modifications or amendments thereof, as approved by the Agent.
"General Contractor" means, with respect to a Construction Property,
the general contractor for construction of Improvements or any portion thereof
at such Construction Property, as approved by the Agent.
"Governmental Approvals" means all authorizations, consents, approvals,
permits, licenses and exemptions of, registrations and filings with, and reports
to, all Governmental Authorities.
"Governmental Authority" means any national, state or local government
(whether domestic or foreign), any political subdivision thereof or any other
governmental, quasi-governmental, judicial, public or statutory instrumentality,
authority, body, agency, bureau or entity (including, without limitation, the
Federal Deposit Insurance Corporation, the Comptroller of the Currency or the
Federal Reserve Board, any central bank or any comparable authority) or any
arbitrator with authority to bind a party at law.
"Gross Asset Value" means, at a given time, the sum (without
duplication) of (a) Operating Real Estate Value at such time, plus (b) all cash
and cash equivalents (excluding cash and cash equivalents the disposition of
which is restricted (other than restrictions on cash held in an exchange account
by a "qualified intermediary" in connection with the sale of a property pursuant
to and qualifying for tax treatment under Section 1031 of the Internal Revenue
Code)), and all accounts receivable net of reserves, of the Parent and its
Subsidiaries at such time, plus (c) the current book value of all real property
of the Parent and its Subsidiaries upon which construction is then in progress
and all land held by any of them for development, plus (d) with respect to
Development Properties, development costs incurred to date with respect to such
Properties plus (e) with respect to Major Redevelopment Properties, (i) the Net
Operating Income for all Major Redevelopment Properties of the Parent and its
Subsidiaries for the four fiscal-quarter period most recently ended (excluding
Major Redevelopment Properties acquired or disposed of by the Parent or any
Subsidiary during such fiscal quarter) divided by 9.25% plus (ii) redevelopment
costs incurred to date with respect to such Properties plus (f) predevelopment
costs incurred to date with respect to Properties to the extent such
predevelopment costs are disclosed as a line item in the Parent's publicly filed
financial statements, plus (g) the purchase price paid by the Parent or any
Subsidiary (less any amounts paid to the Parent or such Subsidiary as a purchase
price adjustment, held in escrow, retained as a contingency reserve, or in
connection with other similar arrangements) for any Property acquired by the
Parent or such Subsidiary during the immediately preceding two fiscal quarters
of the Parent, plus (h) with respect to each Unconsolidated Affiliate of the
Parent, the greater of the Parent's (i) Ownership Share or (ii) Recourse Share
of the book value of construction in process as of the end of the Parent's
fiscal quarter most recently ended, plus (i) the contractual purchase price of
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Properties of the Parent and its Subsidiaries subject to purchase obligations,
repurchase obligations, forward commitments and unfunded obligations to the
extent such obligations and commitments are included in determinations of Total
Liabilities. If obligations under a contract to purchase or otherwise acquire
unimproved or fully developed real property are included when determining Total
Liabilities and the seller under such contract does not have the right to
specifically enforce such contract, then only an amount equal to the aggregate
amount of due diligence deposits, xxxxxxx money payments and other similar
payments made under the contract which, at such time, would be subject to
forfeiture upon termination of the contract, shall be included in Gross Asset
Value. To the extent that the current book value of land held for development
would account for in excess of 5.0% of Gross Asset Value (determined without
giving effect to this sentence), such excess shall be excluded in determining
Gross Asset Value.
"Guarantor" means any Person that is party to the Guaranty as a
"Guarantor" and shall in any event include the Parent.
"Guaranty", "Guaranteed" or to "Guarantee" as applied to any obligation
means and includes: (a) a guaranty (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), directly or
indirectly, in any manner, of any part or all of such obligation, or (b) an
agreement, direct or indirect, contingent or otherwise, and whether or not
constituting a guaranty, the practical effect of which is to assure the payment
or performance (or payment of damages in the event of nonperformance) of any
part or all of such obligation whether by: (i) the purchase of securities or
obligations, (ii) the purchase, sale or lease (as lessee or lessor) of property
or the purchase or sale of services primarily for the purpose of enabling the
obligor with respect to such obligation to make any payment or performance (or
payment of damages in the event of nonperformance) of or on account of any part
or all of such obligation, or to assure the owner of such obligation against
loss, (iii) the supplying of funds to or in any other manner investing in the
obligor with respect to such obligation, (iv) repayment of amounts drawn down by
beneficiaries of letters of credit (including Letters of Credit), or (v) the
supplying of funds to or investing in a Person on account of all or any part of
such Person's obligation under a Guaranty of any obligation or indemnifying or
holding harmless, in any way, such Person against any part or all of such
obligation. As the context requires, "Guaranty" shall also mean the guaranty
executed and delivered pursuant to Section 7.1. and substantially in the form of
Exhibit K-1.
"Hazardous Materials" means all or any of the following: (a) substances
that are defined or listed in, or otherwise classified pursuant to, any
applicable Environmental Laws as "hazardous substances", "hazardous materials",
"hazardous wastes", "toxic substances" or any other formulation intended to
define, list or classify substances by reason of deleterious properties such as
ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity or
"TLCP" toxicity, "EP toxicity"; (b) oil, petroleum or petroleum derived
substances, natural gas, natural gas liquids or synthetic gas and drilling
fluids, produced waters and other wastes associated with the exploration,
development or production of crude oil, natural gas or geothermal resources; (c)
any flammable substances or explosives or any radioactive materials; and (d)
asbestos in any form or (e) electrical equipment which contains any oil or
dielectric fluid containing levels of polychlorinated biphenyls in excess of
fifty parts per million.
I-17
"Improvements" means, with respect to a Construction Property, any and
all improvements to be made to the Mortgaged Property related to such
Construction Property as depicted in the Plans and/or to be constructed by the
Borrower (or applicable Subsidiary Borrower) under the Major Leases and Anchor
Leases, including without limitation parking and related facilities and
amenities, and any additions, alterations or betterments thereto.
"Indebtedness" means, with respect to a Person, at the time of
computation thereof, all of the following (without duplication): (a) obligations
of such Person in respect of money borrowed; (b) obligations of such Person
(other than trade debt incurred in the ordinary course of business), whether or
not for money borrowed (i) represented by notes payable, or drafts accepted, in
each case representing extensions of credit, (ii) evidenced by bonds,
debentures, notes or similar instruments, or (iii) constituting purchase money
indebtedness, conditional sales contracts, title retention debt instruments or
other similar instruments, upon which interest charges are customarily paid or
that are issued or assumed as full or partial payment for property; (c) all
master lease obligations; (d) Capitalized Lease Obligations of such Person; (e)
all reimbursement obligations of such Person under any letters of credit or
acceptances that have been presented for payment; (f) all Indebtedness of other
Persons which (i) such Person has Guaranteed (other than Guarantees which are
solely Guarantees of performance and not of payment and other Guarantees of such
Person for liabilities arising from reasonable and customary exceptions to
Nonrecourse Indebtedness, such as for fraud, willful misrepresentation,
misapplication of funds (including misappropriation of security deposits and
failure to apply rents to operating expenses or debt service), indemnities
relating to environmental matters and waste of property constituting security
for such Nonrecourse Indebtedness, post-default interest, attorney's fees and
other costs of collection to the extent not covered by the value of the property
constituting security for such Nonrecourse Indebtedness and other similar
exceptions to recourse liability) or is otherwise recourse to such Person or
(ii) is secured by a Lien on any property of such Person; provided, that such
Indebtedness shall be limited to the value of such property so encumbered; and
(g) the Recourse Share of all Indebtedness of any partnership of which such
Person is a general partner. For purposes of this definition preferred equity of
a Person shall not be considered to be Indebtedness.
"Independent Inspecting Architect" means an architectural or
engineering firm of the Agent's choice, to be engaged by the Agent at the
Borrower's expense to perform various services on behalf of the Lenders and the
Agent with respect to a Construction Property, including, without limitation:
examination of the applicable Plans and changes thereto, the Cost Breakdown,
change orders, and Disbursement Requests; periodic inspections on behalf of the
Agent and the Lenders; and advising and rendering periodic reports to the Agent
concerning the same; and approving requests for Construction Advances.
"Intellectual Property" has the meaning given that term in Section
8.1.(s).
"Interest Expense" means, with respect to a Person and for any period,
(a) all paid, accrued or capitalized interest expense (including, without
limitation, interest expense attributable to Capitalized Lease Obligations but
excluding capitalized interest funded from a construction loan) of such Person
and in any event shall include all letter of credit fees and all interest
expense with respect to any Indebtedness in respect of which such Person is
wholly or partially liable whether pursuant to any repayment, interest carry,
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performance Guarantee or otherwise, plus (b) to the extent not already included
in the foregoing clause (a) the greater of such Person's (i) Ownership Share or
(ii) Recourse Share of all paid, accrued or capitalized interest expense (as
limited above) for such period of Unconsolidated Affiliates of such Person.
"Interest Period" means with respect to any LIBOR Loan, the period
commencing on the date of the borrowing, Conversion or Continuation of such Loan
and ending on the last day of the period selected by the Borrower pursuant to
the provisions below. The duration of each Interest Period shall be one, two,
three or six months as the Borrower may, in an appropriate Notice of Borrowing,
Notice of Continuation or Notice of Conversion, select. In addition to such
periods, the Borrower may request Interest Periods for LIBOR Loans having
durations of at less than one month no more than 12 times during any 12-month
period beginning during the term of this Agreement but only for the purpose of
managing the number of Interest Periods outstanding with respect to LIBOR Loans.
In no event shall (a) an Interest Period of a Revolving Loan extend beyond the
Revolving Credit Termination Date, (b) an Interest Period of a Term Loan extend
beyond the Termination Date or (c) an Interest Period of a Construction Advance
extend beyond the applicable Construction Loan Maturity Date. Whenever the last
day of any Interest Period would otherwise occur on a day other than a Business
Day, the last day of such Interest Period shall be extended to occur on the next
succeeding Business Day; provided, however, that if such extension would cause
the last day of such Interest Period to occur in the next following calendar
month, the last day of such Interest Period shall occur on the next preceding
Business Day.
"Interest Rate Agreement" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other similar
contractual agreement or arrangement entered into with a nationally recognized
financial institution then having a Credit Rating of BBB- or higher by S&P or
Baa3 or higher by Moody's for the purpose of protecting against fluctuations in
interest rates.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended.
"Investment" means, with respect to any Person and whether or not such
investment constitutes a controlling interest in such Person: (a) the purchase
or other acquisition of any share of capital stock, evidence of Indebtedness or
other security issued by any other Person; (b) any loan, advance or extension of
credit to, or contribution (in the form of money or goods) to the capital of,
any other Person; (c) any Guaranty of the Indebtedness of any other Person; (d)
any other investment in any other Person; and (e) any commitment or option to
make an Investment in any other Person.
"L/C Commitment Amount" means an amount equal to $20,000,000.
"Lease" means, with respect to a Property, any lease, sublease,
license, concession or other agreement (written or oral, now or hereafter in
effect) which grants a possessory interest in and to, or the right to use, all
or any part of such Property, including Major Leases and Anchor Leases.
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"Leasehold Construction Property" means a Construction Property which
is not owned in fee simple by the Borrower (or a Subsidiary Borrower), but as to
which the unimproved land is leased to the Borrower (or such Subsidiary
Borrower) under a lease with an unexpired term of at least 50 years after the
applicable Construction Loan Maturity Date or other unexpired term acceptable to
the Agent.
"Legal Requirements" means, with respect to a Construction Property,
(i) any and all present and future judicial decisions, statutes, rulings, rules,
regulations, permits, proffers, certificates or ordinances of any Governmental
Authority in any way applicable to the Borrower or Subsidiary Borrower which
owns such Construction Property, or to the Mortgaged Property related thereto,
including, without limiting the generality of the foregoing, the ownership, use,
construction, occupancy, possession, operation, maintenance, alteration, repair
or reconstruction thereof; (ii) any and all covenants, conditions or
restrictions contained in any deed or other form of conveyance or in any other
instrument of any nature that relate in any way or are applicable to such
Construction Property, or the ownership, use or occupancy thereof; (iii) the
Borrower's (or such Subsidiary Borrower's) presently or subsequently effective
by-laws and articles of incorporation or partnership, limited partnership, joint
venture, trust or other form of business association agreement; (iv) any and all
Leases and other contracts (written or oral) of any nature that relate, in any
way, to such Construction Property and to which the Borrower (or such Subsidiary
Borrower) may be bound, including, without limiting the generality of the
foregoing, any ground lease underlying a Leasehold Construction Property; and
(v) any and all terms provisions and conditions of any Permanent Loan Commitment
which are to be performed or observed by the Borrower (or such Subsidiary
Borrower).
"Lender" means each financial institution from time to time party
hereto as a "Lender", together with its respective successors and permitted
assigns.
"Lending Office" means, for each Lender and for each Type of Loan, the
office of such Lender specified as such on its signature page hereto or in the
applicable Assignment and Acceptance Agreement, or such other office of such
Lender as such Lender may notify the Agent in writing from time to time.
"Letter of Credit" has the meaning set forth in Section 2.2.(a).
"Letter of Credit Collateral Account" means a special interest bearing
deposit account maintained by the Agent and under its sole dominion and control.
"Letter of Credit Documents" means, with respect to any Letter of
Credit, collectively, any application therefor, any certificate or other
document presented in connection with a drawing under such Letter of Credit and
any other agreement, instrument or other document governing or providing for (a)
the rights and obligations of the parties concerned or at risk with respect to
such Letter of Credit or (b) any collateral security for any of such
obligations.
"Letter of Credit Liabilities" shall mean, without duplication, at any
time and in respect of any Letter of Credit, the sum of (a) the Stated Amount of
such Letter of Credit plus (b) the aggregate unpaid principal amount of all
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Reimbursement Obligations of the Borrower at such time due and payable in
respect of all drawings made under such Letter of Credit. For purposes of this
Agreement, a Lender (other than the Agent in its capacity as such) shall be
deemed to hold a Letter of Credit Liability in an amount equal to its
participation interest in the related Letter of Credit under Section 2.2.(i),
and the Agent shall be deemed to hold a Letter of Credit Liability in an amount
equal to its retained interest in the related Letter of Credit after giving
effect to the acquisition by the Lenders other than the Agent of their
participation interests under such Section.
"LIBOR" means, for any LIBOR Loan for any Interest Period therefor, the
average rate of interest per annum (rounded upwards, if necessary, to the next
highest 1/100th of 1%) at which deposits in immediately available funds in
Dollars are offered to the Agent (at approximately 9:00 a.m., two Business Days
prior to the first day of such Interest Period) by first class banks in the
interbank Eurodollar market where the Eurodollar operations of the Agent are
customarily conducted, for delivery on the first day of such Interest Period,
such deposits being for a period of time equal or comparable to such Interest
Period (or, if such Interest Period is shorter than one month, then such period
of time shall be based on a period of one month) and in an amount equal to or
comparable to the principal amount of the LIBOR Loan to which such Interest
Period relates. Each determination of LIBOR by the Agent shall, in absence of
demonstrable error, be conclusive and binding.
"LIBOR Loan" means a Revolving Loan, Term Loan or Construction Advance
bearing interest at a rate based on LIBOR.
"Lien" as applied to the property of any Person means: (a) any security
interest, encumbrance, mortgage, deed to secure debt, deed of trust, pledge,
lien, charge or lease constituting a Capitalized Lease Obligation, conditional
sale or other title retention agreement, or other security title or encumbrance
of any kind in respect of any property of such Person, or upon the income or
profits therefrom; (b) any arrangement, express or implied, under which any
property of such Person is transferred, sequestered or otherwise identified for
the purpose of subjecting the same to the payment of Indebtedness or performance
of any other obligation in priority to the payment of the general, unsecured
creditors of such Person; (c) the filing of any financing statement under the
Uniform Commercial Code or its equivalent in any jurisdiction, excluding any
financing statement filed to give notice of the existence of an operating lease;
and (d) any agreement by such Person to grant, give or otherwise convey any of
the foregoing.
"Loan" means any Revolving Loan, a Construction Advance or Swingline
Loan.
"Loan Document" means this Agreement, each Note, the Guaranty, each
Construction Guaranty, each Security Document (including each Construction Loan
Security Document), each Letter of Credit Document, any fee letter and each
other document or instrument now or hereafter executed and delivered by a Loan
Party in connection with, pursuant to or relating to this Agreement.
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"Loan Party" means each of the Borrower, each Subsidiary Borrower, the
Parent and each other Guarantor and Construction Guarantor. Schedule 1.1. sets
forth the Loan Parties in addition to the Borrower and the Parent as of the
Agreement Date.
"Major Lease" means, with respect to a Property, a Lease whereby a
tenant leases 20,000 or more, but less than 40,000, of the net rentable square
footage of such Property at the time of determination.
"Major Redevelopment Property" means a Property (a) on which existing
improvements comprising 33% or more of the net rentable square footage of such
Property or which is responsible for 33% or more of the Net Operating Income of
such Property are undergoing renovation and redevelopment and either (i)
construction has commenced or (ii) the owner of such Property (or an Affiliate)
has entered into a binding construction contract; and (b) either (i) which has
not achieved an Occupancy Rate of 85% or more or (ii) on which the improvements
(other than tenant improvements on unoccupied space) related to the renovation
and redevelopment have not been completed. The term "Major Redevelopment
Property" shall include real property of the type described in the immediately
preceding sentence to be (but not yet) acquired upon completion of redevelopment
pursuant to a contract in which the seller of such real property is required to
renovate prior to, and as a condition precedent to, such acquisition.
"Major Tenant" means, with respect to a Property, a tenant under a
Major Lease.
"Material Adverse Effect" means a materially adverse effect on (a) the
business, assets, liabilities, financial condition, results of operations or
business prospects of the Borrower and its Subsidiaries taken as a whole, (b)
the ability of the Borrower or any other Loan Party to perform its obligations
under any Loan Document to which it is a party, (c) the validity or
enforceability of any of the Loan Documents, (d) the rights and remedies of the
Lenders and the Agent under any of such Loan Documents or (e) the timely payment
of the principal of or interest on the Loans or other amounts payable in
connection therewith.
"Material Contract" means any contract or other arrangement (other than
Loan Documents), whether written or oral, to which the Parent, the Borrower, any
other Loan Party or any other Subsidiary is a party as to which the breach,
nonperformance, cancellation or failure to renew by any party thereto could
reasonably be expected to have a Material Adverse Effect, and in any event shall
include, each Property Management Agreement, if any, with respect to a Borrowing
Base Property.
"Material Plan" means at any time a Benefit Plan or Benefit Plans
having aggregate Unfunded Liabilities in excess of $1,000,000.
"Minor Lease" means, with respect to a Property, a Lease whereby a
tenant leases less than 10,000 of the net rentable square footage of such
Property at the time of determination.
"Moody's" means Xxxxx'x Investors Service, Inc.
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"Mortgage" means a mortgage, deed of trust, deed to secure debt or
similar security instrument made or to be made by a Person owning an interest in
real estate granting a Lien on such interest in real estate as security for the
payment of Indebtedness.
"Mortgaged Property" means, with respect to a Construction Property,
such Construction Property, Improvements and Leases, all other property (real,
personal or mixed) which is conveyed by the applicable Security Deed or any
other Construction Loan Security Document related thereto in which a Lien is
created and all other property (real, personal or mixed) assigned or on which a
Lien is placed or granted to secure the repayment of the Construction Advances
or the performance and discharge of the obligations under the applicable
Construction Loan Security Documents.
"Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.
"Negative Pledge" means, with respect to a given asset, any provision
of a document, instrument or agreement (other than any Loan Document) which
prohibits or purports to prohibit the creation of any Lien on such asset as
security for Indebtedness of the Person owning such asset or any other Person.
"Net Operating Income" means, for any Property and for a given period,
the sum of the following (without duplication): (a) rents and other revenues
received in the ordinary course from such Property (including proceeds of rent
loss insurance but excluding pre-paid rents and revenues and security deposits
except to the extent applied in satisfaction of tenants' obligations for rent)
minus (b) all expenses paid or accrued related to the ownership, operation or
maintenance of such Property, including but not limited to taxes, assessments
and other similar charges, insurance, utilities, payroll costs, maintenance,
repair and landscaping expenses, marketing expenses, and general and
administrative expenses (including an appropriate allocation for legal,
accounting, advertising, marketing and other expenses incurred in connection
with such Property, but specifically excluding general overhead expenses of the
Borrower and the Parent) minus (c) the Reserve for Replacements for such
Property as of the end of such period minus (d) the greater of (i) the actual
property management fee paid during such period and (ii) an imputed management
fee in the amount of three percent (3.0%) of the gross revenues for such
Property for such period.
"Net Proceeds" means with respect to an Equity Issuance by a Person,
the aggregate amount of all cash or the Fair Market Value of all other property
received by such Person in respect of such Equity Issuance net of investment
banking fees, legal fees, accountants fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred by such
Person in connection with such Equity Issuance.
"Non-Guarantor Entity" means (a) any Subsidiary that is not required to
become a party to the Guaranty under Section 9.15.(a) or any Construction
Guaranty under Section 9.16.(a) and (b) PREIT-Xxxxx, Inc. ("PREIT-Xxxxx");
provided, however, that PREIT Xxxxx shall be required to become a Guarantor and
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Construction Guarantor hereunder at any time it becomes a "taxable REIT
subsidiary" as defined in Section 856(e) of the Internal Revenue Code.
"Nonrecourse Indebtedness" means, with respect to a Person,
Indebtedness for borrowed money in respect of which recourse for payment (except
for reasonable and customary exceptions for fraud, willful misrepresentation,
misapplication of funds (including misappropriation of security deposits and
failure to apply rents to operating expenses or debt service), indemnities
relating to environmental matters and waste of property constituting security
for such Nonrecourse Indebtedness , post-default interest, attorney's fees and
other costs of collection to the extent not covered by the value of the property
constituting security for such Nonrecourse Indebtedness and other similar
exceptions to nonrecourse liability, and completion guarantees for Development
Properties and Major Redevelopment Properties) is contractually limited to
specific assets of such Person encumbered by a Lien securing such Indebtedness.
"Note" means a Revolving Note, a Construction Note or a Swingline Note.
"Notice of Borrowing" means a notice in the form of Exhibit L to be
delivered to the Agent pursuant to Section 2.1.(b) evidencing the Borrower's
request for a borrowing of Loans.
"Notice of Continuation" means a notice in the form of Exhibit M to be
delivered to the Agent pursuant to Section 2.9. evidencing the Borrower's
request for the Continuation of a LIBOR Loan.
"Notice of Conversion" means a notice in the form of Exhibit N to be
delivered to the Agent pursuant to Section 2.10. evidencing the Borrower's
request for the Conversion of a Loan from one Type to another Type.
"Notice of Swingline Borrowing" means a notice substantially in the
form of Exhibit O to be delivered to the Swingline Lender pursuant to Section
2.3.(b) evidencing the Borrower's request for a Swingline Loan.
"Obligations" means, individually and collectively: (a) the aggregate
principal balance of, and all accrued and unpaid interest on, all Loans; (b) all
Reimbursement Obligations and all other Letter of Credit Liabilities and (c) all
other indebtedness, liabilities, obligations, covenants and duties of the
Borrower owing to the Agent, any Lender or the Swingline Lender of every kind,
nature and description, under or in respect of this Agreement, any of the other
Loan Documents, including, without limitation, the Fees, any other fees payable
under any Loan Document and indemnification obligations, whether direct or
indirect, absolute or contingent, due or not due, contractual or tortious,
liquidated or unliquidated, and whether or not evidenced by any promissory note.
"Occupancy Rate" means, with respect to a Property at any time, the
ratio, expressed as a percentage, of (a) the net rentable square footage of such
Property (to the extent such Property is subject to a Security Deed) actually
occupied by tenants paying rent (including each tenant in occupancy during a
free rent period negotiated under the terms of its lease and space provided to
I-24
and accepted by a tenant for performance by the tenant of fit-up work) pursuant
to binding leases as to which no monetary default has occurred and is continuing
to (b) the aggregate net rentable square footage of such Property (to the extent
such Property is subject to a Security Deed). When determining the Occupancy
Rate of a Property, a tenant (which tenant, with respect to a Borrowing Base
Property and Construction Property, shall be a tenant under an Approved Lease)
will be deemed to be in occupancy provided such tenant (A) is paying rent to the
extent required under the lease, (B) has taken physical possession of its leased
space, and (C) if not already open for business, the Borrower reasonably
anticipates that such tenant will be open for business within 90 days of the
date such tenant first took possession of such space.
"Off Balance Sheet Liabilities" means, with respect to any Person, (a)
any repurchase obligation or liability of such Person with respect to any
accounts or notes receivable sold, transferred or otherwise disposed of by such
Person, (b) any repurchase obligation or liability of such Person with respect
to property or assets leased by such Person as lessee and (c) all obligations of
such Person under any synthetic lease, tax retention operating lease, off
balance sheet loan or similar off balance sheet financing, if in the case of
this clause (c), the transaction giving rise to such obligation (i) is
considered indebtedness for borrowed money for tax purposes but is classified as
an operating lease or (ii) does not (and is not required to pursuant to GAAP)
appear as a liability on the balance sheet of such Person. The obligations or
liabilities of a Person as lessee under any operating lease shall not be
included within this definition so long as the terms of such operating lease do
not require any payment by or on behalf of such Person at the scheduled
termination date of such operating lease, pursuant to a required purchase by or
on behalf of such Person of the property or assets subject to such operating
lease.
"Operating Real Estate Value" means, as of a given date, the Net
Operating Income for all Properties (excluding Development Properties and Major
Redevelopment Properties) of the Parent, its Subsidiaries and its Unconsolidated
Affiliates for the four fiscal-quarter period most recently ended divided by
9.25%. For purposes of determining Operating Real Estate Value (a) Net Operating
Income from Properties acquired by the Parent, any Subsidiary or any
Unconsolidated Affiliate during the immediately preceding two fiscal quarters of
the Parent or disposed of by any such Person during the immediately preceding
fiscal quarter of the Parent, shall be excluded, (b) the calculation of Net
Operating Income from Properties owned by the Parent, any Subsidiary or any
Unconsolidated Affiliate for more than two but less than four fiscal quarters
shall be appropriately annualized, (c) Net Operating Income from Properties upon
which construction is then in progress shall be excluded, and (d) with respect
to a Property owned by an Unconsolidated Affiliate, only the greater of the
Parent's (i) Ownership Share or (ii) Recourse Share of the Net Operating Income,
as applicable, of such Property shall be used when determining Operating Real
Estate Value.
"Ownership Share" means, with respect to any Subsidiary of a Person or
any Unconsolidated Affiliate of a Person, the greater of (a) such Person's
relative nominal direct and indirect ownership interest (expressed as a
percentage) in such Subsidiary or Unconsolidated Affiliate or (b) such Person's
relative direct and indirect economic interest (calculated as a percentage) in
such Subsidiary or Unconsolidated Affiliate determined in accordance with the
applicable provisions of the declaration of trust, articles or certificate of
incorporation, articles of organization, partnership agreement, joint venture
I-25
agreement or other applicable organizational document of such Subsidiary or
Unconsolidated Affiliate.
"Parent" has the meaning set forth in the introductory paragraph hereof
and shall include the Parent's successors and permitted assigns.
"Participant" has the meaning given that term in Section 13.5.(c).
"Partnership Agreement" means that certain First Amended and Restated
Agreement of Limited Partnership Agreement of PREIT Associates, L.P. dated as of
September 30, 1997, by and among Pennsylvania Real Estate Investment Trust, as
the general partner and the limited partners whose names are set forth therein,
as amended and in effect on the Agreement Date.
"PBGC" means the Pension Benefit Guaranty Corporation and any successor
agency.
"Permanent Loan Commitment" means, with respect to any Construction
Property, an agreement, if any, between the Borrower (or a Subsidiary Borrower,
if applicable) and a financial institution or investor acceptable to the Agent,
providing for the purchase or take-out or long-term financing of such
Construction Property upon terms and conditions reasonably acceptable to the
Agent. If there is no Permanent Loan Commitment in effect at the time of funding
the initial Construction Advances for a Construction Property, then the
provisions of this Agreement pertaining thereto shall become effective at such
time as there is an effective Permanent Loan Commitment relating to such
Construction Property.
"Permanent Loan Estimate" means, as of any date and with respect to any
Property, an amount equal to (a) the Net Operating Income of such Property for
the immediately preceding four fiscal quarters of the Borrower (or in the case
of a Construction Property (or Property being considered as a Construction
Property), the Net Operating Income for such Property used in the applicable
Appraisal to determine the "stabilized value" of such Property for the first
year of stabilization) divided by (b) the product of (i) 1.3 and (ii) the
percent of a principal amount of a loan required to be paid each year in order
to repay the principal amount of such loan in full based on a 25-year
amortization, and to pay the amount of interest due at each installment,
utilizing a rate of interest equal to the greater of (x) the rate most recently
published in the United States Federal Reserve Statistical Release (H.15) for
10-year Treasury Constant Maturities plus 2.0% or (y) 8.50%, in equal monthly
installments of principal and interest. For any Property which is a Borrowing
Base Property or Construction Property, only Net Operating Income from Approved
Leases shall be considered in determining the Permanent Loan Estimate. When
determining the Permanent Loan Estimate of any Property that has been included
in calculations of the Borrowing Base for less than four complete fiscal
quarters of the Borrower, the Property's Net Operating Income for the Borrower's
fiscal quarter most recently ending prior to such inclusion and any subsequent
complete fiscal quarters, appropriately annualized, shall be used in the
preceding clause (a).
"Permits" means, with respect to any Construction Property, any and all
governmental permits, approvals, inspections, orders, certificates and the like
issued to or for the benefit of the Borrower (or the Subsidiary Borrower which
owns such Construction Property) in connection with the development,
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construction, use and/or occupancy of the Mortgaged Property, specifically
including, but not limited to, all building, excavation, sheeting, shoring,
foundation, grading, and occupancy permits.
"Permitted Change Order" means, with respect to any Construction
Property, a change order which does not materially change the Plans for such
Construction Property, and either (a) (i) increases the cost amount attributable
to the item being changed as shown on the Cost Breakdown for such Construction
Property, and (ii) when the amount of such increase is added to the aggregate
amount of the increases of all prior Permitted Change Orders which increase the
cost thereof, such sum does not exceed 5.0% of the amount of the applicable line
item or 5.0% of the aggregate costs shown on such Cost Breakdown or (b) (i)
decreases the cost amount attributable to the item being changed as shown on the
Cost Breakdown for such Construction Property, and (ii) when the amount of such
decrease is added to the aggregate amount of the decreases of all prior
Permitted Change Orders for such Construction Property which decrease the cost
thereof, such sum does not exceed 5.0% of the amount of the applicable line item
or 5.0% of the aggregate costs shown on such Cost Breakdown.
"Permitted Liens" means (a) Liens securing taxes, assessments and other
charges or levies imposed by any Governmental Authority (excluding any Lien
imposed pursuant to any of the provisions of ERISA or pursuant to any
Environmental Laws) or the claims of materialmen, mechanics, carriers,
warehousemen or landlords for labor, materials, supplies or rentals incurred in
the ordinary course of business, which are not at the time required to be paid
or discharged under Section 9.7.; (b) Liens consisting of deposits or pledges
made, in the ordinary course of business, in connection with, or to secure
payment of, obligations under workmen's compensation, unemployment insurance or
similar Applicable Laws; (c) Liens consisting of encumbrances in the nature of
zoning restrictions, easements, and rights or restrictions of record on the use
of real property, which do not materially detract from the value of such
property or impair the use thereof in the business of such Person; (d) the
rights of tenants under leases or subleases not interfering with the ordinary
conduct of business of the Borrower and (e) Liens in favor of the Agent for the
benefit of the Lenders.
"Person" means an individual, corporation, partnership, limited
liability company, association, trust or unincorporated organization, or a
government or any agency or political subdivision thereof.
"Plans" means, with respect to any Construction Property, the plans and
specifications for the construction of the Improvements thereon, prepared by the
Architect and approved by the Agent, with such amendments thereto as may from
time to time be made by Borrower (or the applicable Subsidiary Borrower) and
approved by the Agent and, at the Agent's election, the Independent Inspecting
Architect, and in all events including tenant improvements (as and when included
or incorporated into the Plans) irrespective of whether the tenant plans are
prepared by the owner's architect, the tenant's architect, or otherwise,
including such changes thereto which are (i) permitted as arising from Permitted
Change Orders or approved changes to the Cost Breakdown as provided herein, or
(ii) if clause (i) is not applicable, are otherwise approved in writing by the
Agent.
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"Post-Default Rate" means, in respect of any principal of any Loan or
any other Obligation that is not paid when due (whether at stated maturity, by
acceleration, by optional or mandatory prepayment or otherwise), a rate per
annum equal to 5.0% plus the Base Rate as in effect from time to time.
"Post-Foreclosure Plan" has the meaning given that term in Section
12.9.
"Preferred Stock" means, with respect to any Person, shares of capital
stock of, or other Equity Interests in, such Person which are entitled to
preference or priority over any other capital stock of, or other Equity Interest
in, such Person in respect of the payment of dividends or distribution of assets
upon liquidation or both.
"Property" means a parcel (or group of related parcels) of real
property developed (or which is to be developed) principally for retail,
industrial or residential multi-family use.
"Property Management Agreements" means, collectively, all agreements
entered into by the Borrower or a Subsidiary pursuant to which the Borrower or
such Subsidiary engages a Person to advise it with respect to the management of
a given Property.
"Property Management Contract Assignment" means a Property Management
Contract Assignment executed by the Borrower in favor of the Agent for the
benefit of the Lenders substantially in the form of Exhibit P-1 or Exhibit P-2
or otherwise in form and substance satisfactory to the Agent. Such document may,
at the Agent's election, constitute a subordination of Property Management
Agreement, rather than an assignment thereof.
"Protective Advance" means all sums expended as determined by the Agent
to be necessary or appropriate after the Borrower fails to do so when required:
(a) to protect the validity, enforceability, perfection or priority of the Liens
in any of the Collateral and the instruments evidencing the Obligations; (b) to
prevent the value of any Collateral from being materially diminished (assuming
the lack of such a payment within the necessary time frame could potentially
cause such Collateral to lose value); or (c) to protect any of the Collateral
from being materially damaged, impaired, mismanaged or taken, including, without
limitation, any amounts expended in connection therewith in accordance with
Section 13.2.
"Rating Agencies" means each of Xxxxx'x and S&P.
"Recourse Share" means, with respect to any Person, the portion
(calculated as a percentage) of the total Indebtedness of another Person
guaranteed by such Person, or which is otherwise recourse to such Person (other
than Indebtedness consisting of Guarantees which are solely Guarantees of
performance and not of payment and other Guarantees of such Person for
liabilities arising from reasonable and customary exceptions to Nonrecourse
Indebtedness, such as for fraud, willful misrepresentation, misapplication of
funds (including misappropriation of security deposits and failure to apply
rents to operating expenses or debt service), indemnities relating to
environmental matters and waste of property constituting security for such
Nonrecourse Indebtedness, post-default interest, attorney's fees and other costs
of collection to the extent not covered by the value of the property
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constituting security for such Nonrecourse Indebtedness and other similar
exceptions to recourse liability).
"Register" has the meaning given that term in Section 13.5.(e).
"Regulatory Change" means, with respect to any Lender, any change
effective after the Agreement Date (or with respect to any Lender that becomes a
party to this Agreement after the Agreement Date, any change effective after the
date on which such Lender becomes a party hereto) in Applicable Law (including
without limitation, Regulation D of the Board of Governors of the Federal
Reserve System) or the adoption or making after such date of any interpretation,
directive or request applying to a class of banks, including such Lender, of or
under any Applicable Law (whether or not having the force of law and whether or
not failure to comply therewith would be unlawful) by any Governmental Authority
or monetary authority charged with the interpretation or administration thereof
or compliance by any Lender with any request or directive regarding capital
adequacy.
"Reimbursement Obligation" means the absolute, unconditional and
irrevocable obligation of the Borrower to reimburse the Agent for any drawing
honored by the Agent under a Letter of Credit.
"REIT" means a Person qualifying for treatment as a "real estate
investment trust" under the Internal Revenue Code.
"Rejecting Lender" has the meaning given that term in Section 2.15.
"Requisite Lenders" means, as of any date, (a) Lenders having at least
66-2/3% of the aggregate amount of the Revolving Commitments, or, if the
Revolving Commitments have been terminated or reduced to zero, Lenders holding
at least 66-2/3% of the principal amount of the Loans and Letter of Credit
Liabilities and (b) Lenders having at least 66-2/3% of the aggregate amount of
the Construction Commitments, or, if the Construction Commitments have been
terminated or reduced to zero, Lenders holding at least 66-2/3% of the principal
amount of the Construction Advances.
"Reserve for Replacements" means, for any period and with respect to
any Property, an amount equal to (a)(i) if such Property is an apartment
complex, $250 per apartment unit; or (ii) for any retail or industrial Property,
the greater of (x)(A) the aggregate square footage of all completed space of
such Property times (B) $0.15 in the case of a retail Property or $0.10 in the
case of an industrial Property or (y) the actual capital expenditures made with
respect to such Property during such period (excluding capital expenditures in
respect of non-recurring items) times (b) the number of days in such period
divided by (c) 365. The Properties included in the calculation of Reserve for
Replacements shall not include those Properties or portions thereof with respect
to which or to the extent that a third party (a) owns the improvements thereon,
(b) is a party to a ground lease with the Parent, the Borrower or a Subsidiary
with respect to the land therein and (c) is contractually obligated to make all
repairs and capital improvements and replacements thereof.
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"Restricted Payment" means: (a) any dividend or other distribution,
direct or indirect, on account of any shares or similar units of any class of
stock or other equity interest of the Parent or any of its Subsidiaries now or
hereafter outstanding, except a dividend payable solely in shares or similar
units of such class of stock or other equity interest to the holders thereof;
(b) any redemption, conversion, exchange, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any
shares or similar units of any class of stock or other equity interest of the
Parent or any of its Subsidiaries now or hereafter outstanding; (c) any payment
or prepayment of principal of, premium, if any, or interest on, redemption,
conversion, exchange, purchase, retirement, defeasance, sinking fund or similar
payment with respect to, any Subordinated Debt; and (d) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares or similar units of any class of stock or other
equity interest of the Parent or any of its Subsidiaries now or hereafter
outstanding.
"Revolving Commitment" means, as to each Lender, such Lender's
obligation to make Revolving Loans pursuant to Section 2.1. and to issue (in the
case of the Agent) or participate in (in the case of the other Lenders) Letters
of Credit pursuant to Section 2.2.(a) and 2.2.(i) respectively, in an amount up
to, but not exceeding, (but in the case of the Agent excluding the aggregate
amount of participations in the Letters of Credit held by other Lenders) the
amount set forth for such Lender on its signature page hereto as such Lender's
"Revolving Commitment Amount" or as set forth in the applicable Assignment and
Acceptance Agreement, as the same may be reduced or increased from time to time
pursuant to the terms of this Agreement.
"Revolving Commitment Percentage" means, as to each Lender, the ratio,
expressed as a percentage, of (a) the amount of such Lender's Revolving
Commitment to (b) the aggregate amount of the Revolving Commitments of all
Lenders hereunder; provided, however, that if at the time of determination the
Revolving Commitments have terminated or been reduced to zero, the "Revolving
Commitment Percentage" of each Lender shall be the Revolving Commitment
Percentage of such Lender in effect immediately prior to such termination or
reduction.
"Revolving Credit Termination Date" means the first to occur of (a)
December 28, 2003, or such later date to which such date may be extended in
accordance with Section 2.15. or (b) the date on which the Revolving Loans are
converted into Term Loans pursuant to Section 2.16.
"Revolving Loan" means a loan made by a Lender to the Borrower pursuant
to Section 2.1.(a).
"Revolving Note" has the meaning given that term in Section 2.11.(a).
"S&P" means Standard & Poor's Rating Services, a division of The
XxXxxx-Xxxx Companies, Inc.
"Securities Act" means the Securities Act of 1933, as amended from time
to time, together with all rules and regulations issued thereunder.
I-30
"Security Deed" means a Mortgage executed by the Borrower or any
Subsidiary in favor of the Agent, given as security for payment of all or any
portion of the Obligations, similar in form and substance to the agreement
attached as Exhibit Q, or otherwise in form and substance satisfactory to the
Agent.
"Security Documents" means all Security Deeds, all Assignments of
Leases and Rents, all Property Management Contract Assignments and all other
security agreements, financing statements, and other documents, instruments and
agreements creating, evidencing or perfecting the Agent's Liens in any of the
Collateral.
"Solvent" means, when used with respect to any Person, that (a) the
fair value and the fair salable value of its assets (excluding any Indebtedness
due from any affiliate of such Person) are each in excess of the fair valuation
of its total liabilities (including all contingent liabilities); and (b) such
Person is able to pay its debts or other obligations in the ordinary course as
they mature and (c) that the Person has capital not unreasonably small to carry
on its business and all business in which it proposes to be engaged.
"Stabilization Date" means, with respect to a Borrowing Base Property,
the last day of the month in which the Net Operating Income of such Property
equals or exceeds the corresponding Net Operating Income levels used in the
applicable Appraisal to determine the "stabilized value" of such Property for 90
consecutive days as certified by the Borrower. If a new Appraisal is obtained in
accordance with any of the provisions of Section 4.1.(b), the Stabilization Date
shall be reestablished as the last day of the month to occur following
acceptance of such Appraisal by the Agent during which month the Net Operating
Income of such Property equals or exceeds the corresponding Net Operating Income
levels used in such Appraisal to determine the "stabilized value" of such
Property as certified by the Borrower.
"Stated Amount" means the amount available to be drawn by a beneficiary
under a Letter of Credit from time to time, as such amount may be increased or
reduced from time to time in accordance with the terms of such Letter of Credit.
"Subordinated Debt" means Indebtedness for money borrowed of the
Parent, the Borrower or any other Subsidiary that is subordinated in right of
payment and otherwise to the Loans and the other Obligations (or in the case of
a Subsidiary that is a Guarantor or Construction Guarantor, all obligations of
such Subsidiary under or in respect of the Guaranty or any Construction
Guaranty, respectively) in a manner satisfactory to the Agent in its sole and
absolute discretion.
"Subsidiary" means, for any Person, any corporation, partnership or
other entity of which at least a majority of the securities or other ownership
interests having by the terms thereof ordinary voting power to elect a majority
of the board of directors or other persons performing similar functions of such
corporation, partnership or other entity (without regard to the occurrence of
any contingency) is at the time directly or indirectly owned or controlled by
such Person or one or more Subsidiaries of such Person or by such Person and one
or more Subsidiaries of such Person.
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"Subsidiary Borrower" means any Subsidiary or Approved Joint Venture of
the Borrower (a) which has a legal structure and capitalization intended to make
such entity a single purpose, single asset entity and which legal structure and
capitalization have been approved in writing by the Agent in its sole and
absolute discretion and (b) for which none of the Loan Parties or any other
Subsidiary has any direct obligation to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of
operating results.
"Substantial Amount" means, at the time of determination thereof, an
amount in excess of 30.0% of total consolidated assets (exclusive of
depreciation) at such time of the Parent and its Subsidiaries determined on a
consolidated basis.
"Supplemental Equity Deposit" means, with respect to any Construction
Property, an amount (if any) calculated by the Agent to equal the difference
between (a) the amount which the Agent from time to time determines to be
necessary: to pay all costs to be incurred in connection with the Completion of
the Improvements for such Construction Property in accordance with the Cost
Breakdown, the Plans, the Construction Contracts, the Construction Loan Security
Documents for such Construction Property and this Agreement; to pay all sums
which may accrue under the applicable Construction Loan Security Documents prior
to Completion of the Improvements, including, without limiting the generality of
the foregoing, interest on the Construction Advances advanced with respect to
such Construction Property; and to enable the Borrower (or the Subsidiary which
owns such Construction Property) to perform and satisfy all of the covenants of
such Person contained in the Construction Loan Security Documents and (b) the
amount by which the applicable Construction Loan Limit exceeds the aggregate
outstanding principal amount of Construction Advances advanced with respect to
such Construction Property.
"Swingline Commitment" means the Swingline Lender's obligation to make
Swingline Loans pursuant to Section 2.3. in an amount up to, but not exceeding,
$20,000,000, as such amount may be reduced from time to time in accordance with
the terms hereof.
"Swingline Lender" means Xxxxx Fargo Bank, National Association,
together with its respective successors and assigns.
"Swingline Loan" means a loan made by the Swingline Lender to the
Borrower pursuant to Section 2.3.(a).
"Swingline Note" means the promissory note of the Borrower
substantially in the form of Exhibit R, payable to the order of the Swingline
Lender in a principal amount equal to the amount of the Swingline Commitment as
originally in effect and otherwise duly completed.
"Swingline Termination Date" means the date which is seven Business
Days prior to the Revolving Credit Termination Date.
"Tangible Net Worth" means, for any Person and as of a given date, such
Person's total consolidated stockholder's equity plus, in the case of the
Parent, accumulated depreciation and amortization, minus (to the extent
reflected in determining stockholders' equity of such Person): (a) the amount of
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any write-up in the book value of any assets reflected in any balance sheet
resulting from revaluation thereof or any write-up in excess of the cost of such
assets acquired, and (b) the aggregate of all amounts appearing on the assets
side of any such balance sheet for patents, patent applications, copyrights,
trademarks, trade names, goodwill and other like assets which would be
classified as intangible assets under GAAP, all determined on a consolidated
basis.
"Taxes" has the meaning given that term in Section 3.11.
"Term Loan" has the meaning given that term in Section 2.16.
"Termination Date" means the date two years following the Revolving
Credit Termination Date.
"Tie-In Jurisdiction" means a jurisdiction in which a "tie-in"
endorsement may be obtained for a title insurance policy covering property
located in such jurisdiction which endorsement effectively ties coverage to
other title insurance policies covering properties located in other
jurisdictions.
"Title Company" means the issuer of the Title Insurance Policy as to a
Construction Property.
"Title Insurance Policy" means an ALTA 1992 Form mortgagee's Policy of
Title Insurance (without any creditor's rights exclusion and without any
mandatory arbitration provision) or other form acceptable to the Agent, in favor
of the Agent for the benefit of the Lenders with respect to such Construction
Property, including endorsements with respect to such items of coverage as the
Agent may request and which endorsements are available, issued by a title
insurance company acceptable to the Agent and with coinsurance or reinsurance
(with direct access agreements) with title insurance companies acceptable to the
Agent, showing the fee simple title to the land, and improvements, if any, or
leasehold title, if issued with respect to a Leasehold Construction Property,
described in the applicable Security Deed as vested in the Borrower or a
Subsidiary, and insuring that the Lien granted by such Security Deed is a valid
first priority Lien against said property, subject only to such restrictions,
encumbrances, easements and reservations as are acceptable to the Agent. The
amount of coverage under such policy must equal (x) the Construction Loan Limit
of such Construction Property if such Construction Property is not located in a
Tie-In Jurisdiction or (y) the such lesser amount as is acceptable to Agent if
at such time if such Construction Property is located in a Tie-In Jurisdiction
"Total Budgeted Cost Until Stabilization" means, with respect to a
Development Property or a Major Redevelopment Property, and at any time, the
aggregate amount of all costs budgeted to be paid, incurred or otherwise
expended or accrued by the Parent, the Borrower, a Subsidiary or an
Unconsolidated Affiliate with respect to such Property to achieve an Occupancy
Rate of 100%, including without limitation, all amounts budgeted with respect to
all of the following: (a) acquisition of land and any related improvements; (b)
a reasonable and appropriate reserve for construction interest; (c) a reasonable
and appropriate operating deficit reserve; (d) tenant improvements; (e) leasing
commissions and infrastructure costs and (f) other hard and soft costs
I-33
associated with the development or redevelopment of such Property. With respect
to any Property to be developed in more than one phase, the Total Budgeted Cost
Until Stabilization shall exclude budgeted costs (other than costs relating to
acquisition of land and related improvements) to the extent relating to any
phase for which (i) construction has not yet commenced and (ii) a binding
construction contract has not been entered into by the Parent, the Borrower, any
other Subsidiary or any Unconsolidated Affiliate, as the case may be. The
calculation of Total Budgeted Cost Until Stabilization herein shall be net of
the aggregate sale proceeds of a sale of a pad site within a Development
Property or Major Redevelopment Property that are payable pursuant to a binding
sale contract with a third party approved by the Agent.
"Total Commitment Percentage" means, as to each Lender, the ratio,
expressed as a percentage, of (a) the aggregate amount of such Lender's
Revolving Commitment and its Construction Commitment to (b) the aggregate amount
of the Revolving Commitments and Construction Commitments of all Lenders
hereunder.
"Total Liabilities" means, as to any Person as of a given date, all
liabilities which would, in conformity with GAAP, be properly classified as a
liability on the consolidated balance sheet of such Person as of such date, and
in any event shall include (without duplication): (a) all Indebtedness of such
Person (whether or not Nonrecourse Indebtedness and whether or not secured by a
Lien), including without limitation, Capitalized Lease Obligations and the full
stated amount of undrawn letters of credit issued for the account of such
Person, but excluding (i) letters of credit secured with cash collateral, (ii)
letters of credit issued solely in lieu of a non-payment performance obligation,
(iii) letters of credit securing a refundable obligation under a binding
contract and (iv) that certain Letter of Credit issued hereunder in the stated
amount of $5,000,000 and naming The Equitable Life Assurance Society of the
United States as the beneficiary; (b) all accounts payable (including tenant
deposits accounted for as payables but excluding tenant deposits held as
restricted cash and not included in the calculation of Gross Asset Value
pursuant to clause (b) of the definition of such term) and accrued expenses of
such Person; (c) all purchase and repurchase obligations and forward commitments
of such Person to the extent such obligations or commitments are evidenced by a
binding purchase agreement (forward commitments shall include without limitation
forward equity commitments); (d) all unfunded obligations of such Person; (e)
all lease obligations of such Person (including ground leases) to the extent
required under GAAP to be classified as a liability on the balance sheet of such
Person; (f) all Contingent Obligations and Off Balance Sheet Liabilities of such
Person; (g) all liabilities of any Unconsolidated Affiliate of such Person,
which liabilities such Person has Guaranteed or is otherwise obligated on a
recourse basis; and (h) the greater of such Person's (i) Ownership Share or (ii)
Recourse Share of the Indebtedness of any Unconsolidated Affiliate of such
Person, including Nonrecourse Indebtedness of such Person. For purposes of
clauses (c) and (d) of this definition, the amount of Total Liabilities of a
Person at any given time in respect of a contract to purchase or otherwise
acquire unimproved or fully developed real property shall be equal to (i) the
total purchase price payable by such Person under the contract if, at such time,
the seller of such real property would be entitled to specifically enforce the
contract against such Person, otherwise, (ii) the aggregate amount of due
diligence deposits, xxxxxxx money payments and other similar payments made by
such Person under the contract which, at such time, would be subject to
forfeiture upon termination of the contract. For purposes of this definition, if
the assets of a Subsidiary of a Person consist solely of Equity Interests in one
Unconsolidated Affiliate of such Person and such Person is not otherwise
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obligated in respect of the Indebtedness of such Unconsolidated Affiliate, then
only such Person's Ownership Share of the Indebtedness of such Unconsolidated
Affiliate shall be included as Total Liabilities of such Person. For purposes of
this definition, the Total Liabilities of the Parent associated with the Blue
Route shall, at any time prior to and including March 31, 2001, equal the
Parent's Ownership Share of the Indebtedness of the Blue Route.
"Trust Agreement" means that certain Pennsylvania Real Estate
Investment Trust Trust Agreement, as amended and restated as of December 16,
1997, among the trustees a party thereto, as amended and in effect on the
Agreement Date.
"Type" with respect to any Revolving Loan, Term Loan or Construction
Advance, refers to whether such Loan is a LIBOR Loan or Base Rate Loan.
"UCC" means the Uniform Commercial Code as in effect in the
Commonwealth of Pennsylvania.
"Unconsolidated Affiliate" means, with respect to any Person, any other
Person in whom such Person holds an Investment, which Investment is accounted
for in the financial statements of such Person on an equity basis of accounting
and whose financial results would not be consolidated in accordance with GAAP
with the financial results of such Person on the consolidated financial
statements of such Person.
"Unfunded Liabilities" means, with respect to any Benefit Plan at any
time, the amount (if any) by which (a) the value of all benefit liabilities
under such Benefit Plan, determined on a plan termination basis using the
assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA,
exceeds (b) the fair market value of all Benefit Plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid
contributions), all determined as of the then most recent valuation date for
such Benefit Plan, but only to the extent that such excess represents a
potential liability of a member of the ERISA Group to the PBGC or any other
Person under Title IV of ERISA.
"Xxxxx Fargo" means Xxxxx Fargo Bank, National Association, and its
successors and permitted assigns.
"Wholly Owned Subsidiary" means any Subsidiary of a Person all of the
equity securities or other ownership interests (other than, in the case of a
corporation, directors' qualifying shares) of which are at the time directly or
indirectly owned or controlled by such Person or one or more other Subsidiaries
of such Person or by such Person and one or more other Subsidiaries of such
Person. In the case of the Parent, the term "Wholly Owned Subsidiary" shall also
include any Subsidiary of the Parent (a) of which the Parent owns or controls,
directly, or indirectly through one or more other Subsidiaries, substantially
all of the equity securities or other ownership interests and (b) over which the
Parent possesses sufficient control to warrant treating such Subsidiary as if it
were otherwise a Wholly Owned Subsidiary, in each case, as determined by the
Agent.
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