FIRST AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
DATED MARCH___, 1996
AMONG
MERIDIAN INDUSTRIAL TRUST, INC.
AND
THE FIRST NATIONAL BANK OF BOSTON,
THE OTHER BANKS WHICH ARE
A PARTY TO THIS AGREEMENT
AND
OTHER BANKS WHICH MAY BECOME
PARTIES TO THIS AGREEMENT
AND
THE FIRST NATIONAL BANK OF BOSTON,
AS AGENT
TABLE OF CONTENTS
Section 1. DEFINITIONS AND RULES OF INTERPRETATION...........................-2-
Section 1.1. DEFINITIONS.......................................-2-
Section 1.2. RULES OF INTERPRETATION..........................-18-
Section 2. THE REVOLVING CREDIT FACILITY....................................-19-
Section 2.1. COMMITMENT TO LEND...............................-19-
Section 2.2. FACILITY FEE.....................................-19-
Section 2.3. INTENTIONALLY OMITTED............................-19-
Section 2.4. NOTES............................................-20-
Section 2.5. INTEREST ON LOANS................................-20-
Section 2.6. REQUESTS FOR LOANS...............................-20-
Section 2.7. FUNDS FOR LOANS..................................-21-
Section 2.8. EXTENSION OF MATURITY DATE.......................-22-
Section 2.9. LETTERS OF CREDIT................................-23-
Section 3. REPAYMENT OF THE LOANS...........................................-25-
Section 3.1. STATED MATURITY..................................-25-
Section 3.2. MANDATORY PREPAYMENTS............................-25-
Section 3.3. OPTIONAL PREPAYMENTS.............................-25-
Section 3.4. PARTIAL PREPAYMENTS..............................-25-
Section 3.5. EFFECT OF PREPAYMENTS............................-26-
Section 3.6. PROCEEDS FROM DEBT OFFERING AND EQUITY
OFFERING.........................................-26-
Section 4. CERTAIN GENERAL PROVISIONS.......................................-26-
Section 4.1. CONVERSION OPTIONS...............................-26-
Section 4.2. COMMITMENT FEE...................................-27-
Section 4.3. INTENTIONALLY OMITTED............................-27-
Section 4.4. FUNDS FOR PAYMENTS...............................-27-
Section 4.5. COMPUTATIONS.....................................-28-
Section 4.6. INABILITY TO DETERMINE EURODOLLAR RATE...........-28-
Section 4.7. ILLEGALITY.......................................-29-
Section 4.8. ADDITIONAL INTEREST..............................-29-
Section 4.9. ADDITIONAL COSTS, ETC............................-29-
Section 4.10. CAPITAL ADEQUACY................................-31-
Section 4.11. INDEMNITY OF BORROWER...........................-31-
Section 4.12. INTEREST ON OVERDUE AMOUNTS; LATE CHARGE........-31-
Section 4.13. CERTIFICATE.....................................-31-
Section 4.14. LIMITATION ON INTEREST..........................-32-
Section 5. SECURITY.........................................................-32-
i
Section 6. REPRESENTATIONS AND WARRANTIES...................................-32-
Section 6.1. CORPORATE AUTHORITY, ETC.........................-32-
Section 6.2. GOVERNMENTAL APPROVALS...........................-33-
Section 6.3. TITLE TO PROPERTIES; LEASES......................-33-
Section 6.4. FINANCIAL STATEMENTS.............................-34-
Section 6.5. NO MATERIAL CHANGES..............................-34-
Section 6.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC.............-34-
Section 6.7. LITIGATION.......................................-35-
Section 6.8. NO MATERIALLY ADVERSE CONTRACTS, ETC.............-35-
Section 6.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC.....-35-
Section 6.10. TAX STATUS......................................-35-
Section 6.11. NO EVENT OF DEFAULT.............................-35-
Section 6.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS.....-35-
Section 6.13. ABSENCE OF UCC FINANCING STATEMENTS, ETC........-36-
Section 6.14. INTENTIONALLY OMITTED...........................-36-
Section 6.15. CERTAIN TRANSACTIONS............................-36-
Section 6.16. EMPLOYEE BENEFIT PLANS..........................-36-
Section 6.17. REGULATIONS U AND X.............................-36-
Section 6.18. ENVIRONMENTAL COMPLIANCE........................-37-
Section 6.19. SUBSIDIARIES....................................-38-
Section 6.20. INTENTIONALLY OMITTED...........................-38-
Section 6.21. LOAN DOCUMENTS..................................-38-
Section 6.22. PROPERTY........................................-38-
Section 6.23. BROKERS.........................................-39-
Section 6.24. OTHER DEBT......................................-39-
Section 6.25. SOLVENCY........................................-39-
Section 6.26. GUARANTOR.......................................-39-
Section 7. AFFIRMATIVE COVENANTS OF THE BORROWER............................-40-
Section 7.1. PUNCTUAL PAYMENT.................................-40-
Section 7.2. MAINTENANCE OF OFFICE............................-40-
Section 7.3. RECORDS AND ACCOUNTS.............................-40-
Section 7.4. FINANCIAL STATEMENTS, CERTIFICATES AND
INFORMATION......................................-40-
Section 7.5. NOTICES..........................................-42-
Section 7.6. EXISTENCE; MAINTENANCE OF PROPERTIES.............-44-
Section 7.7. INSURANCE........................................-44-
Section 7.8. TAXES............................................-44-
Section 7.9. INSPECTION OF PROPERTIES AND BOOKS...............-45-
Section 7.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES,
AND PERMITS.....................................-45-
Section 7.11. USE OF PROCEEDS.................................-45-
Section 7.12. FURTHER ASSURANCES..............................-46-
Section 7.13. REIT STATUS.....................................-46-
Section 7.14. RESTRICTIONS ON ACQUISITIONS....................-46-
ii
Section 7.15. UNENCUMBERED OPERATING PROPERTIES...............-46-
Section 7.16. LIMITING AGREEMENTS.............................-47-
Section 7.17. ENVIRONMENTAL AND ENGINEERING INSPECTIONS.......-48-
Section 8. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.......................-48-
Section 8.1. RESTRICTIONS ON INDEBTEDNESS.....................-48-
Section 8.2. RESTRICTIONS ON LIENS, ETC.......................-49-
Section 8.3. RESTRICTIONS ON INVESTMENTS..................... -50-
Section 8.4. MERGER, CONSOLIDATION............................-52-
Section 8.5. SALE AND LEASEBACK...............................-52-
Section 8.6. COMPLIANCE WITH ENVIRONMENTAL LAWS...............-52-
Section 8.7. DISTRIBUTIONS....................................-53-
Section 8.8. ASSET SALES......................................-54-
Section 8.9. DEVELOPMENT ACTIVITY.............................-54-
Section 8.10. SOURCES OF CAPITAL..............................-55-
Section 8.11. RESTRICTION ON PREPAYMENT OF INDEBTEDNESS.......-55-
Section 9. FINANCIAL COVENANTS OF THE BORROWER..............................-55-
Section 9.1. LIABILITIES TO TANGIBLE NET WORTH RATIO..........-55-
Section 9.2. DEBT COVERAGE....................................-55-
Section 9.3. FIXED CHARGE COVERAGE............................-56-
Section 9.4. BORROWING BASE...................................-56-
Section 9.5. TANGIBLE NET WORTH...............................-56-
Section 9.6. REAL ESTATE ASSETS...............................-56-
Section 9.7. VALUE ADJUSTMENT.................................-56-
Section 9.8. ANNUALIZATION OF RESULTS.........................-57-
Section 10. CLOSING CONDITIONS..............................................-57-
Section 10.1. LOAN DOCUMENTS..................................-57-
Section 10.2. CERTIFIED COPIES OF ORGANIZATIONAL DOCUMENTS....-57-
Section 10.3. BYLAWS; RESOLUTIONS AND CONSENTS................-57-
Section 10.4. INCUMBENCY CERTIFICATE; AUTHORIZED SIGNERS......-58-
Section 10.5. OPINION OF COUNSEL..............................-58-
Section 10.6. PAYMENT OF FEES.................................-58-
Section 10.7. PERFORMANCE; NO DEFAULT.........................-58-
Section 10.8. REPRESENTATIONS AND WARRANTIES..................-58-
Section 10.9. PROCEEDINGS AND DOCUMENTS.......................-58-
Section 10.10. COMPLIANCE CERTIFICATE.........................-59-
Section 10.11. OTHER..........................................-59-
Section 10.12. INTENTIONALLY OMITTED...........................-59-
Section 10.13. INTENTIONALLY OMITTED..........................-59-
Section 10.14. EQUITY OFFERING................................-59-
Section 10.15. TANGIBLE NET WORTH.............................-59-
iii
Section 10.16. DUE DILIGENCE..................................-59-
Section 10.17. MANAGEMENT OF THE BORROWER.....................-59-
Section 11. CONDITIONS TO ALL BORROWINGS....................................-59-
Section 11.1. PRIOR CONDITIONS SATISFIED......................-59-
Section 11.2. REPRESENTATIONS TRUE; NO DEFAULT................-59-
Section 11.3. NO LEGAL IMPEDIMENT.............................-60-
Section 11.4. GOVERNMENTAL REGULATION.........................-60-
Section 11.5. PROCEEDINGS AND DOCUMENTS.......................-60-
Section 11.6. BORROWING DOCUMENTS.............................-60-
Section 12. EVENTS OF DEFAULT; ACCELERATION; ETC............................-60-
Section 12.1. EVENTS OF DEFAULT AND ACCELERATION..............-60-
Section 12.2. LIMITATION OF CURE PERIODS......................-63-
Section 12.3. TERMINATION OF COMMITMENTS......................-64-
Section 12.4. REMEDIES........................................-64-
Section 12.5. DISTRIBUTION OF PROCEEDS........................-64-
Section 13. INTENTIONALLY OMITTED...........................................-65-
Section 14. THE AGENT.......................................................-65-
Section 14.1. AUTHORIZATION...................................-65-
Section 14.2. EMPLOYEES AND AGENTS............................-65-
Section 14.3. NO LIABILITY....................................-66-
Section 14.4. NO REPRESENTATIONS..............................-66-
Section 14.5. PAYMENTS........................................-66-
Section 14.6. HOLDERS OF NOTES................................-67-
Section 14.7. INDEMNITY.......................................-67-
Section 14.8. AGENT AS BANK...................................-68-
Section 14.9. RESIGNATION.....................................-68-
Section 14.10. DUTIES IN THE CASE OF ENFORCEMENT..............-68-
Section 14.11. DETERMINATIONS BY AGENT........................-68-
Section 15. EXPENSES........................................................-69-
Section 16. INDEMNIFICATION.................................................-69-
Section 17. SURVIVAL OF COVENANTS, ETC......................................-70-
Section 18. ASSIGNMENT AND PARTICIPATION....................................-71-
Section 18.1. CONDITIONS TO ASSIGNMENT BY BANKS...............-71-
Section 18.2. REGISTER........................................-71-
Section 18.3. NEW NOTES.......................................-72-
iv
Section 18.4. PARTICIPATIONS..................................-72-
Section 18.5. PLEDGE BY BANK..................................-72-
Section 18.6. NO ASSIGNMENT BY BORROWER.......................-72-
Section 18.7. DISCLOSURE......................................-72-
Section 19. NOTICES.........................................................-73-
Section 20. RELATIONSHIP....................................................-74-
Section 21. GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE..............-74-
Section 22. HEADINGS........................................................-75-
Section 23. COUNTERPARTS....................................................-75-
Section 24. ENTIRE AGREEMENT, ETC...........................................-75-
Section 25. WAIVER OF JURY TRIAL............................................-75-
Section 26. DEALINGS WITH THE BORROWER......................................-76-
Section 27. CONSENTS, AMENDMENTS, WAIVERS, ETC..............................-76-
Section 28. SEVERABILITY....................................................-77-
Section 29. NO UNWRITTEN AGREEMENTS.........................................-77-
Section 30. TIME OF THE ESSENCE.............................................-77-
v
EXHIBIT A - Form of Note
EXHIBIT B - Form of Request for Loan
EXHIBIT C - Reserved
EXHIBIT D - Form of Compliance Certificate
SCHEDULE 1 - Banks and Commitments
SCHEDULE 2 - Initial Unencumbered Properties
SCHEDULE 3 - Adjusted Asset Values of Real Estate
SCHEDULE 6.3 - Title to Properties; Leases
SCHEDULE 6.7 - Litigation
SCHEDULE 6.19 - Subsidiaries of the Borrower
vi
FIRST AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
THIS FIRST AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (this
"Agreement") is made the ____ day of March, 1996, by and among MERIDIAN
INDUSTRIAL TRUST, INC. (the "Borrower"), a Maryland corporation having its
principal place of business at 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxxxx,
Xxxxxxxxxx 00000, THE FIRST NATIONAL BANK OF BOSTON, TEXAS COMMERCE BANK
NATIONAL ASSOCIATION, NATIONSBANK OF TEXAS, N.A. and the other lending
institutions which may become parties hereto pursuant to Section 18 (the
"Banks"), THE FIRST NATIONAL BANK OF BOSTON, as Agent for the Banks (the
"Agent"), and TEXAS COMMERCE BANK, NATIONAL ASSOCIATION, as Co-Agent for the
Banks (the "Co-Agent").
RECITALS.
WHEREAS, Borrower, Agent, Co-Agent and the Banks have entered into that
Revolving Credit Agreement dated February 26, 1996 (the "Original Credit
Agreement"); and
WHEREAS, Borrower has requested that the Banks increase the Total
Commitment and add a sublimit for letters of credit; and
WHEREAS, Borrower, Agent, Co-Agent and the Banks desire to amend and
restate the Original Credit Agreement in its entirety;
NOW, THEREFORE, in consideration of the recitals herein and the mutual
covenants contained herein, the parties hereto hereby agree to amend and
restate the Original Credit Agreement in its entirety as follows:
Section 1. DEFINITIONS AND RULES OF INTERPRETATION.
Section 1.1. DEFINITIONS. The following terms shall have the meanings
set forth in this Section l or elsewhere in the provisions of this Agreement
referred to below:
AGENT. The First National Bank of Boston acting as agent for the Banks,
its successors and assigns.
AGENT'S HEAD OFFICE. The Agent's head office located at 000 Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other location as the Agent
may designate from time to time by notice to the Borrower and the Banks.
AGENT'S SPECIAL COUNSEL. Long, Xxxxxxxx & Xxxxxx or such other counsel
as may be approved by the Agent.
AGREEMENT. This First Amended and Restated Revolving Credit Agreement,
including the SCHEDULES and EXHIBITS hereto.
ASSET VALUE. With respect to the Initial Unencumbered Operating
Properties and any other parcels of Real Estate owned by the Borrower and its
Subsidiaries as of the Closing Date, the book value after adjustment for
market values in accordance with Section 9.7, and with respect to Unencumbered
Operating Properties and any other parcels of Real Estate acquired after the
Closing Date, the purchase price (including improvements) and ordinary
related purchase transaction costs, without deduction for depreciation, or if
developed by the Borrower, the completed construction costs, determined in
accordance with generally accepted accounting principles. If any parcel of
Real Estate is purchased as a part of a group of properties, the Asset Value
shall be calculated based upon a reasonable allocation by the Borrower of the
aggregate purchase price among all parcels of Real Estate purchased in such
transaction and agreed to by the Majority Banks.
AUTHORIZED OFFICER. As to the Borrower, each of Xxxxx X. Xxxxxxxx, as
Chairman of the Board of the Borrower; Xxxxxx Xxxxxx, as President of the
Borrower; or Xxx Xxxxxx, as Treasurer/Controller of the Borrower; and their
respective successors in office. As to each Guarantor, the managing general
partner of each such Guarantor and their respective successors in office.
BALANCE SHEET DATE. September 30, 1995.
BANKS. FNBB, Texas Commerce Bank National Association, NationsBank of
Texas, N.A. and any other Person who becomes an assignee of any rights of a
Bank pursuant to Section 18 (but not including any Participant, as defined
in Section 18).
BASE RATE. The higher of (a) the annual rate of interest announced from
time to time by the Agent at its head office as its "base rate", or (b) one
half of one percent (0.5%) above the Federal Funds Effective Rate (rounded
upwards, if necessary, to the next one-eighth of one percent). Any change in
the rate of interest payable hereunder resulting from a change in the Base
Rate shall become effective as of the opening of business on the day on which
such change in the Base Rate becomes effective.
BASE RATE LOANS. Those Loans bearing interest calculated by reference
to the Base Rate.
BORROWER. As defined in the preamble hereto.
BORROWING BASE. At any time, the Borrowing Base shall be the aggregate
of the Borrowing Bases for each Unencumbered Operating Property. The
Borrowing Base for each Unencumbered Operating Property shall be the amount
which is the lesser of (a) fifty percent (50%) of the Asset Value of each
Unencumbered Operating Property; or (b) fifty percent (50%)
>
of the value of each Unencumbered Operating Property, such value being
determined as follows: (x) for each Initial Unencumbered Operating Property
and each hereafter acquired Unencumbered Operating Property which does not
constitute a Qualifying Property, value shall be the amount resulting from
dividing (i) the sum of Net Operating Income for the four preceding fiscal
quarters MINUS the Capital Improvement Reserve for such Unencumbered
Operating Property by (ii) ten and one half percent (10.5%); and (y) for each
Qualifying Property, value shall be the amount resulting from dividing (i)
Net Operating Income for the four preceding fiscal quarters MINUS the Capital
Improvement Reserve for such Qualifying Property by (ii) nine and
three-quarters of one percent (9.75%); or (c) the Debt Service Coverage
Amount for each Unencumbered Operating Property; and the amount which is the
lesser of (a), (b) or (c) shall be the Borrowing Base for each Unencumbered
Operating Property.
BUILDING. With respect to any portion of the Real Estate, all of the
buildings, structures and improvements now or hereafter located thereon.
BUSINESS DAY. Any day on which banking institutions in the head office
of the Agent are open for the transaction of banking business and, in the
case of Eurodollar Rate Loans, which also is a Eurodollar Business Day.
CASH AVAILABLE FOR DISTRIBUTION. With respect to any Person for any
fiscal period, an amount equal to Funds from Operations, MINUS the Capital
Improvement Reserve with respect to the Real Estate, MINUS actual tenant
improvements and leasing commissions incurred during such fiscal period.
CAPITAL IMPROVEMENT PROJECT. With respect to any Real Estate now or
hereafter owned by the Borrower or its Subsidiaries which is utilized
principally for industrial purposes, capital improvements consisting of
rehabilitation, refurbishment, replacement and improvements to the existing
Buildings on such Real Estate which may be properly capitalized under
generally accepted accounting principles.
CAPITAL IMPROVEMENT RESERVE. With respect to the Real Estate or any
portion thereof, a reserve for Capital Improvement Projects in the amount of
fifteen cents ($0.15) multiplied by the Gross Rentable Area contained therein.
CERCLA. See Section 6.18.
CLOSING DATE. The first date on which all of the conditions set forth
in Section 10 and Section 11 have been satisfied.
CO-AGENT. Texas Commerce Bank National Association, acting as co-agent
with Agent for the Banks, its successors and assigns.
CODE. The Internal Revenue Code of 1986, as amended.
-3-
COMMITMENT. With respect to each Bank, the amount set forth on SCHEDULE 1
hereto as the amount of such Bank's Commitment to make or maintain Loans to
the Borrower or purchase participations in Letters of Credit issued by the
Agent to the Borrower, as the same may be changed from time to time in
accordance with the terms of this Agreement.
COMMITMENT PERCENTAGE. With respect to each Bank, the percentage set
forth on SCHEDULE 1 hereto as such Bank's percentage of the aggregate
Commitments of all of the Banks.
COMPLIANCE CERTIFICATE. See Section 7.4(e).
CONSOLIDATED or COMBINED. With reference to any term defined herein,
that term as applied to the accounts of the Borrower and its Subsidiaries,
consolidated or combined in accordance with generally accepted accounting
principles.
CONSOLIDATED TANGIBLE NET WORTH. The amount by which Consolidated Total
Assets exceed Consolidated Total Liabilities, and LESS the sum of:
(a) the total book value of all assets of a Person properly classified
as intangible assets under generally accepted accounting principles,
including such items as good will, the purchase price of acquired assets
in excess of the fair market value thereof, trademarks, trade names,
service marks, brand names, copyrights, patents and licenses, and rights
with respect to the foregoing; PLUS
(b) all amounts representing any write-up in the book value of any
assets of such Person resulting from a revaluation thereof subsequent to
the Balance Sheet Date; PLUS
(c) prepaid fees and deferred charges (regardless of whether classified
as intangible assets under generally accepted accounting principles); PLUS
(d) the total book value of any minority interests in partnerships,
joint ventures, corporation or other entities.
CONSOLIDATED TOTAL ASSETS. All assets of the Borrower and its
Subsidiaries determined on a Consolidated basis in accordance with generally
accepted accounting principles. The assets of the Borrower and its
Subsidiaries on the consolidated financial statements of the Borrower and its
Subsidiaries shall be adjusted as of the Closing Date for market values in
accordance with Section 9.7 and to reflect the Borrower's allocable share of
such asset, for the relevant period or as of the date of determination,
taking into account (a) the relative proportion of each such item derived
from assets directly owned by the Borrower and from assets owned by its
respective Subsidiaries, and (b) the Borrower's respective ownership interest
in its Subsidiaries.
-4-
CONSOLIDATED TOTAL LIABILITIES. All liabilities of the Borrower and its
Subsidiaries determined on a Consolidated basis in accordance with generally
accepted accounting principles and all Indebtedness of the Borrower and its
Subsidiaries, whether or not so classified.
CONVERSION REQUEST. A notice given by the Borrower to the Agent of its
election to convert or continue a Loan in accordance with Section 4.1.
DEBT OFFERING. The issuance and sale by the Borrower or the Guarantor
of any debt securities of the Borrower or the Guarantor.
DEBT SERVICE. For any period, the sum of all interest (including
capitalized interest) and mandatory scheduled principal payments due and
payable during such period with respect to any Indebtedness excluding any
balloon payments due upon maturity of any Indebtedness. For the period prior
to the date hereof, Debt Service on the Prudential Loan shall be calculated
by multiplying the outstanding principal balance of the Prudential Loan as of
May 31, 1995, by 8.62%. For the purpose of testing compliance with the
covenants contained in Section 9.2 and Section 9.3 only, Debt Service for
any fiscal quarter prior to the consolidation of certain Subsidiaries with
and into Borrower as described in Section 10.13 shall be calculated on the
basis of the interest rate and the total amount of the Indebtedness as of the
date of such consolidation.
DEBT SERVICE COVERAGE AMOUNT. At any time determined by Agent, an
amount equal to the maximum principal loan amount which, when bearing
interest at a rate per annum equal to the greater of (a) the then-current
annual yield on ten (10) year obligations issued by the United States
Treasury most recently prior to the date of determination plus two percent
(2%) and (b) ten percent (10%), and payable based on a twenty-five year
mortgage style amortization schedule, could be paid by the monthly principal
and interest payment amount resulting from dividing (x) the quotient obtained
by dividing an amount equal to (i) the sum of the Net Operating Income from
an individual Unencumbered Operating Property for the preceding four fiscal
quarters, MINUS the Capital Improvement Reserve for such Unencumbered
Operating Property, by (ii) 1.75 by (y) 12.
DEFAULT. See Section 12.1.
DISTRIBUTION. The declaration or payment of any dividend or
distribution on or in respect of any shares of beneficial interest of the
Borrower or the Guarantor, other than dividends or distributions payable
solely in equity securities of the Borrower or the Guarantor; the purchase,
redemption, exchange or other retirement of any shares of beneficial interest
of the Borrower or the Guarantor, directly or indirectly through a Subsidiary
of the Borrower or the Guarantor or otherwise, including without limitation,
the purchase of shares of beneficial interest of the Borrower for cash
pursuant to the Excepted Holder Agreement (as defined in the definition of
Indebtedness), but excluding the purchase of shares of beneficial interest of
the Borrower from executive officers of the Borrower where the only
consideration for such purchase is the extinguishing of notes made by such
executive officers and held by the Borrower; the return of
-5-
capital by the Borrower to its shareholders as such; or any other distribution
on or in respect of any shares of beneficial interest of the Borrower or the
Guarantor, including, without limitation, interest and premium paid on the
Debentures (as defined in the definition of Indebtedness).
DOLLARS or $. Dollars in lawful currency of the United States of
America.
DOMESTIC LENDING OFFICE. Initially, the office of each Bank designated
as such in SCHEDULE 1 hereto; thereafter, such other office of such Bank, if
any, located within the United States that will be making or maintaining Base
Rate Loans.
DRAWDOWN DATE. The date on which any Loan is made, and the date on
which any Loan which is made prior to the Maturity Date is converted or
combined in accordance with Section 4.1.
EMPLOYEE BENEFIT PLAN. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate, other than a Multi-employer Plan.
ENVIRONMENTAL LAWS. See Section 6.18(a).
EQUITY OFFERING. The issuance and sale by the Borrower or the Guarantor
of any equity securities of the Borrower or the Guarantor.
ERISA. The Employee Retirement Income Security Act of 1974, as amended
and in effect from time to time and any rules and regulations promulgated
pursuant thereto.
ERISA AFFILIATE. Any Person which is treated as a single employer with
the Borrower under Section 414 of the Code.
ERISA REPORTABLE EVENT. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder as to which the requirement of notice has not been
waived.
EUROCURRENCY RESERVE RATE. For any day with respect to a Eurodollar
Rate Loan, the maximum rate (expressed as a decimal) at which the Reference
Bank would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in Regulation D or any successor or
similar regulation), if such liabilities were outstanding. The Eurocurrency
Reserve Rate shall be adjusted automatically on and as of the effective date
of any change in the Eurocurrency Reserve Rate.
EURODOLLAR BUSINESS DAY. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or
such other eurodollar interbank
-6-
market as may be selected by the Agent in its sole discretion acting in good
faith.
EURODOLLAR LENDING OFFICE. Initially, the office of each Bank
designated as such in SCHEDULE 1 hereto; thereafter, such other office of
such Bank, if any, that shall be making or maintaining Eurodollar Rate Loans.
EURODOLLAR RATE. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate per annum equal to the sum of (a) the quotient (rounded
upwards to the nearest 1/16 of one percent) of (i) the rate at which the
Reference Bank's Eurodollar Lending Office is offered Dollar deposits two
Eurodollar Business Days prior to the beginning of such Interest Period in
whatever interbank eurodollar market may be selected by the Reference Bank in
its sole discretion, acting in good faith, for delivery on the first day of
such Interest Period for the number of days comprised therein and in an
amount comparable to the amount of the Eurodollar Rate Loan to which such
Interest Period applies (based upon Telerate quotes, page 3750, or such other
page as contains the same information as contained on page 3750), divided by
(ii) a number equal to 1.00 minus the Eurocurrency Reserve Rate; and (b) one
and seven-tenths percent (1.7%).
EURODOLLAR RATE LOANS. Loans bearing interest calculated by reference
to a Eurodollar Rate.
EVENT OF DEFAULT. See Section 12.1.
EXTENSION REQUEST. See Section 2.8.
FEDERAL FUNDS EFFECTIVE RATE. For any day, the rate per annum 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,
as published for such day (or, if such day is not a Business Day, for the
next preceding Business Day) by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day that is a Business Day, the average
of the quotations for such day on such transactions received by the Agent
from three Federal funds brokers of recognized standing selected by the Agent.
FNBB. The First National Bank of Boston.
FUNDING CAP. The limit on the aggregate amount of Outstanding Loans and
Outstanding Letters of Credit (including Letters of Credit accepted but
unpaid), as in effect from time to time. As of the date of this Agreement,
the Funding Cap is $50,000,000.00 ($16,666,666.67 for each Bank). For each
additional $1,000,000.00 of gross proceeds received by the Borrower from an
Equity Offering subsequent to March 1, 1996 (and over and above the
$35,000,000.00 in gross proceeds which was a condition to the closing under
the Original Agreement), the Funding Cap shall be increased by $1,000,000.00,
up to, but not in excess of the Total Commitment of $75,000,000.00. Prior to
an increase in the Funding Cap, the Borrower shall provide to the Agent
evidence reasonably satisfactory to the Majority Banks the amount of gross
proceeds
-7-
received from any such Equity Offering.
FUNDS FROM OPERATIONS. With respect to any Person for any fiscal
period, an amount equal to the Net Income (or Deficit) of such Person
computed in accordance with generally accepted accounting principles,
excluding financing costs and gains (or losses) from debt restructuring and
sales of property, PLUS depreciation and amortization and other non-cash
items, PLUS the amortized portion of the Initial Loan Fees for such fiscal
period (excluding amortization of loan fees not constituting Initial Loan
Fees).
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. Principles that are (a)
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, as in effect from time to
time and (b) consistently applied with past financial statements of the
Borrower or any of its Subsidiaries adopting the same principles; PROVIDED
that a certified public accountant would, insofar as the use of such
accounting principles is pertinent, be in a position to deliver an
unqualified opinion (other than a qualification regarding changes in
generally accepted accounting principles) as to financial statements in which
such principles have been properly applied.
GROSS CASH RECEIPTS. Gross Cash Receipts shall mean with respect to any
parcel of Real Estate the sum of cash recorded during any period by or for
the account of the Borrower or the Guarantor in payment of the following
items:
(b) Rentals, including minimum or base rent, percentage rent, and
rent attributable to recovery of tenant improvements costs
received from tenants occupying space in such parcel of Real Estate
during such period (prepaid rentals shall be treated in accordance
with generally accepted accounting principles);
(c) All amounts paid by tenants to the Borrower or the
Guarantor under Leases with respect to taxes and assessments
imposed on such parcel of Real Estate or in reimbursement of
operating expenses;
(d) Parking revenues received in connection with the operation of
parking facilities; and
(e) Receipts from vending machines, recreational facilities and any and
all other operating revenues received from such parcel of Real
Estate.
In the event that the Borrower or the Guarantor receives a
payment of Gross Cash Receipts other than on a monthly basis, then
for the purposes of determining the Gross Cash Receipts for a four
quarter period (a "Determination Period"), only the amount of such
payment which relates to the Determination Period (as opposed to a
period either before or after the Determination Period) shall be
included in the calculation of Gross Cash Receipts for such period.
-8-
Any payment of Gross Cash Receipts received from a tenant of a parcel of
Real Estate which is delinquent shall not be included as Gross Cash Receipts
until all delinquencies relating to such tenant for any prior periods have
been paid in full. Gross Cash Receipts shall not include any amounts payable
by tenants holding over pursuant to expired or terminated Leases, nor any
amounts paid by tenants as late charges, default interest or such other
similar charges.
If the Borrower or the Guarantor shall receive cash by reason of fire or
other casualty insurance proceeds, proceeds of rental, loss or business
interruption insurance (except to the extent that such proceeds replace the
rental payments which otherwise would have been due to the Borrower or the
Guarantor from tenants of a parcel of Real Estate), the forfeiting by tenants
of security or other deposits or payments made by tenants to cancel their
Leases or the recovery by the Borrower or the Guarantor of future rentals
under Leases (regardless of whether or not discounted to present value), or a
taking by eminent domain, a loan or advance, a sale, transfer, assignment or
other disposition of any part of a parcel of Real Estate or any interest
therein, or any other items of income which are extraordinary or of a
non-recurring nature, such amounts shall not be included in Gross Cash
Receipts.
Except as otherwise provided herein, Gross Cash Receipts shall be
determined on the basis of generally accepted accounting principles applied
on a consistent basis.
GROSS RENTABLE AREA. With respect to any portion of the Real Estate,
the floor area of a Building (exclusive of common areas) available for
leasing to tenants determined in accordance with the Rent Roll for such Real
Estate, the manner of such determination to be consistent for all Real Estate
unless otherwise approved by the Agent.
GUARANTEED PENSION PLAN. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by the
Borrower or any ERISA Affiliate the benefits of which are guaranteed on
termination in full or in part by the PBGC pursuant to Title IV of ERISA,
other than a Multi-employer Plan.
HAZARDOUS SUBSTANCES. See Section 6.18(b).
GUARANTOR. DFW Nine, A California Limited Partnership, a California
limited partnership, having a usual place of business at c/o Meridian
Industrial Trust, Inc., 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxxxx,
Xxxxxxxxxx 00000.
GUARANTY. The Unconditional Guaranty of Payment and Performance dated
February 26, 1996 made by the Guarantor in favor of Agent and the Banks, as
modified by that certain First Amendment to Unconditional Guaranty of Payment
and Performance dated of even date herewith, and as the same may be modified
or amended hereafter, such Guaranty to be in form and substance satisfactory
to the Agent.
-9-
INDEBTEDNESS. All obligations, contingent and otherwise, that in
accordance with generally accepted accounting principles should be classified
upon the obligor's balance sheet as liabilities, or to which reference should
be made by footnotes thereto, including in any event and whether or not so
classified: (a) all debt and similar monetary obligations, whether direct or
indirect (including, without limitation, any obligations evidenced by bonds,
debentures, notes or similar debt instruments); (b) all liabilities secured
by any mortgage, pledge, security interest, lien, charge or other encumbrance
existing on property owned or acquired subject thereto, whether or not the
liability secured thereby shall have been assumed; (c) all guarantees,
endorsements and other contingent obligations whether direct or indirect in
respect of indebtedness of others, including any obligation to supply funds
to or in any manner to invest directly or indirectly in a Person, to purchase
indebtedness, or to assure the owner of indebtedness against loss through an
agreement to purchase goods, supplies or services for the purpose of enabling
the debtor to make payment of the indebtedness held by such owner or
otherwise, and the obligation to reimburse the issuer in respect of any
letter of credit; (d) all obligations to purchase under agreements to
acquire, or otherwise to contribute money with respect to, properties under
"development" within the meaning of Section 8.9; (e) a Person's pro rata
share of any of the above-described obligations of its unconsolidated
affiliates; and (f) all amounts available to be drawn under Letters of
Credit; PROVIDED, HOWEVER, that with respect to the conversion of certain
preferred stock of the Borrower into debentures of the Borrower (the
"Debentures") pursuant to that certain Excepted Holder Agreement to be
entered into between the Borrower and State Street Bank and Trust Company, as
Trustee for Ameritech Pension Trust ("Ameritech"), and that certain letter
agreement (the "Letter Agreement") dated December 29, 1995, between the
Borrower and Ameritech, such Debentures shall be excluded from the definition
of Indebtedness for the purposes of this Agreement upon the approval by the
Banks of each and every term of the Debentures in the exercise of their sole
discretion, including, without limitation, the terms of the subordination of
such Debentures to payment of the Loans and all renewals, modifications and
extensions thereof, and provided further that Ameritech shall enter into a
subordination and standstill agreement in form and substance satisfactory to
the Banks in their sole discretion.
INITIAL LOAN FEES. The fees payable by the Borrower in connection with
the closing of the transactions contemplated by the Original Credit
Agreement, this Agreement and the restructure of the Prudential Loan
completed on May 31, 1995, including any and all fees paid or which may be
paid by the Borrower after such date in connection with collateralizing or
modifying the collateralization of the Prudential Loan pursuant to such
restructuring.
INITIAL UNENCUMBERED OPERATING PROPERTIES. The Unencumbered Operating
Properties described on SCHEDULE 2 attached hereto.
INTEREST PAYMENT DATE. As to each Loan, the first day of each calendar
month during the term of such Loan and with respect to each Eurodollar Rate
Loan, the last day of each Interest Period during the term of such Eurodollar
Rate Loan.
-10-
INTEREST PERIOD. With respect to each Eurodollar Rate Loan (a)
initially, the period commencing on the Drawdown Date of such Loan and ending
one, two, three or six months thereafter, and (b) thereafter, each period
commencing on the day following the last day of the next preceding Interest
Period applicable to such Loan and ending on the last day of one of the
periods set forth above, as selected by the Borrower in a Conversion Request;
PROVIDED that all of the foregoing provisions relating to Interest Periods
are subject to the following:
(A) if any Interest Period with respect to a Eurodollar Rate Loan
would otherwise end on a day that is not a Eurodollar Business Day, that
Interest Period shall end and the next Interest Period shall commence on the
next preceding or succeeding Eurodollar Business Day as determined
conclusively by the Reference Bank in accordance with the then current bank
practice in the applicable eurodollar interbank market;
(B) if the Borrower shall fail to give notice as provided in
Section 4.1, the Borrower shall be deemed to have requested a conversion of
the affected Eurodollar Rate Loan to a Base Rate Loan on the last day of the
then current Interest Period with respect thereto; and
(C) no Interest Period relating to any Eurodollar Rate Loan shall
extend beyond the Maturity Date.
INVESTMENTS. With respect to any Person, all shares of capital stock,
evidences of Indebtedness and other securities issued by any other Person,
all loans, advances, or extensions of credit to, or contributions to the
capital of, any other Person, all purchases of the securities or business or
integral part of the business of any other Person and commitments and options
to make such purchases, all interests in real property, and all other
investments; PROVIDED, HOWEVER, that the term "Investment" shall not include
(i) equipment, inventory and other tangible personal property acquired in the
ordinary course of business, or (ii) current trade and customer accounts
receivable for services rendered in the ordinary course of business and
payable in accordance with customary trade terms. In determining the
aggregate amount of Investments outstanding at any particular time: (a) the
amount of any investment represented as a guaranty shall be taken at not less
than the principal amount of the obligations guaranteed and still
outstanding; (b) there shall be included as an Investment all interest
accrued with respect to Indebtedness constituting an Investment unless and
until such interest is paid; (c) there shall be deducted in respect of each
such Investment any amount received as a return of capital (but only by
repurchase, redemption, retirement, repayment, liquidating dividend or
liquidating distribution); (d) there shall not be deducted in respect of any
Investment any amounts received as earnings on such Investment, whether as
dividends, interest or otherwise, except that accrued interest included as
provided in the foregoing clause (b) may be deducted when paid; and (e) there
shall not be deducted from the aggregate amount of Investments any decrease
in the value thereof.
LEASES. Leases, licenses and agreements whether written or oral,
relating to the use or
11
occupation of space in the Building or on the Real Estate by persons other
than the Borrower or the Guarantor.
LETTER OF CREDIT. A standby letter of credit which is payable upon
presentation of a sight draft and other documents, as originally issued
pursuant to this Agreement or as amended, modified, extended, reviewed or
supplemented.
LETTER OF CREDIT REQUEST. See Section 2.9.
LIENS. See Section 8.2.
LOAN DOCUMENTS. This Agreement, the Notes, the Guaranty and all other
documents, instruments or agreements executed or delivered by or on behalf of
the Borrower or the Guarantor evidencing or securing the Loans.
LOAN REQUEST. See Section 2.6.
LOANS. The aggregate Loans to be made by the Banks hereunder. Amounts
drawn under a Letter of Credit shall also be considered Loans as provided in
Section 2.9(f).
MAJORITY BANKS. As of any date, the Agent and the Bank or Banks whose
aggregate Commitment Percentage is equal to or greater than the percentage
required to approve such matter as set forth in that certain Intercreditor
Agreement dated of even date herewith among the Banks, and as disclosed by
the Agent to the Borrower from time to time.
MATURITY DATE. February 26, 1998, as the same may be extended as
provided in Section 2.8 or such earlier date on which the Loans shall become
due and payable pursuant to the terms hereof.
MULTI-EMPLOYER PLAN. Any Multi-employer plan within the meaning of
Section 3(37) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate.
NET CAPITAL EXPENDITURES. With respect to any Person or asset for any
fiscal period, an amount equal to the amount of capital expenditures incurred
by such Person or with respect to such asset during such fiscal period
determined in accordance with generally accepted accounting principles.
NET INCOME (OR DEFICIT). With respect to any Person (or any asset of
any Person) for any fiscal period, the net income (or deficit) of such Person
(or attributable to such asset), after deduction of all expenses, taxes and
other proper charges, determined in accordance with generally accepted
accounting principles. For the purpose of testing compliance with the
covenants contained in Section 9.2 and Section 9.3 only, overhead and
other expenses for any fiscal quarter prior to the consolidation of certain
Subsidiaries with and into the Borrower as described in
12
Section 10.13 shall be in an amount equal to the quarterly pro forma
overhead and expenses for the first year following such consolidation as
approved by the Agent.
NET OPERATING INCOME. During any period for any parcel of Real Estate,
the sum of (a) Gross Cash Receipts from such parcel of Real Estate less (b)
Operating Expenses for such parcel of Real Estate.
NON-RECOURSE INDEBTEDNESS. Indebtedness of the Borrower or any
Subsidiary which is secured by one or more parcels of Real Estate and related
personal property or interests therein and Short-term Investments and is not
a general obligation of the Borrower or any Subsidiary, the holder of such
Indebtedness having recourse solely to the parcels of Real Estate securing
such Indebtedness, the improvements thereon, related personal property and
leases thereon, and the rents and profits thereof and the Short-term
Investments securing such Indebtedness.
NOTES. See Section 2.4.
NOTICE. See Section 19.
OBLIGATIONS. All indebtedness, obligations and liabilities of the
Borrower to any of the Banks and the Agent, individually or collectively,
under this Agreement or any of the other Loan Documents or in respect of any
of the Loans, the Letters of Credit or the Notes, or other instruments at any
time evidencing any of the foregoing, whether existing on the date of this
Agreement or arising or incurred hereafter, direct or indirect, joint or
several, absolute or contingent, matured or unmatured, liquidated or
unliquidated, secured or unsecured, arising by contract, operation of law or
otherwise.
OPERATING CASH FLOW. With respect to any parcel of Real Estate for any
period, an amount equal to Net Operating Income less Net Capital Expenditures.
OPERATING EXPENSES. With respect to any parcel of Real Estate during
any period the sum of the following:
(a) All taxes and assessments imposed upon such parcel of Real
Estate actually paid by or on behalf of the Borrower or the
Guarantor (to the extent not paid by tenants of the Borrower
or the Guarantor) during such period in accordance with
generally accepted accounting principles (or if such taxes or
assessments are paid in advance with respect to future periods,
such payment shall be amortized over the period covered by such
payment);
(b) The amounts paid by or on behalf of the Borrower or the
Guarantor (to the extent not paid by tenants of the Borrower
or the Guarantor) in such period in accordance with generally
accepted accounting principles on account of
13
insurance premiums for insurance carried in connection with
such parcel of Real Estate or the Borrower's or the Guarantor's
ownership and operation thereof, and the deductible amounts
expended by the Borrower or the Guarantor not reimbursed under
any such insurance (or if such insurance premiums are paid in
advance with respect to future periods, such payment shall be
amortized over the period covered by such payment); and
(c) Operating expenses paid by or on behalf of the Borrower or the
Guarantor in such period for the operation, cleaning,
marketing, maintenance and repair of such parcel of Real Estate
properly chargeable against income according to generally
accepted accounting principles, including management fees.
For the purposes of this Agreement, Operating Expenses shall not include any
of the following:
(i) Foreign, U.S., state and local income taxes, franchise
taxes or other taxes based on the income imposed on the
Borrower or the Guarantor generally and not as owner of such
parcel of Real Estate;
(ii) Depreciation and any other non-cash expenditures of the
Borrower or the Guarantor for income tax purposes;
(iii) Any improvements to such parcel of Real Estate of a
capital nature (as determined in accordance with generally
accepted accounting practices);
(iv) Any expense paid or incurred in connection with the sale
of all or any part of such parcel of Real Estate or any
interest therein;
(v) All costs, expenses, fees, commissions or other compensation
paid by or on behalf of the Borrower or the Guarantor
in connection with the renovation, improvement or development
of such parcel of Real Estate to the extent treated as Net
Capital Expenditures;
(vi) Any payment of principal or interest under the Notes or
other fees or charges payable under this Agreement; and
(vii) The Capital Improvement Reserve.
Operating Expenses shall be determined on the basis of sound cash basis
accounting practices applied on a consistent basis, modified as described
above.
OUTSTANDING. With respect to the Loans, the aggregate unpaid principal
thereof as of any
14
date of determination. With respect to the Letters of Credit, the aggregate
amount of amounts available to be drawn under Letters of Credit.
PBGC. The Pension Benefit Guaranty Corporation created by Section 4002
of ERISA and any successor entity or entities having similar responsibilities.
PERMITTED LIENS. Liens, security interests and other encumbrances
permitted by Section 8.2.
PERSON. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
PROSPECTUS. The prospectus included in the registration statement on
Form S-4 of the Borrower dated January 11, 1996 and filed with the SEC.
PRUDENTIAL LOAN. That certain $66,100,000 Non-recourse loan made by The
Prudential Life Insurance Company of America to Borrower as restructured by
the predecessors in interest of the Borrower on May 31, 1995, as amended on
December 14, 1995.
QUALIFYING PROPERTY. With respect to the Unencumbered Operating
Properties, an Unencumbered Operating Property meeting all of the following
requirements at the time of determination: (a) age does not exceed twelve
(12) years; (b) total Gross Rentable Area is not less than 50,000 square
feet; (c) use is non-specialized; and (d) at least two of the following three
characteristics are present: (i) finished out air conditioned office space
does not exceed twenty percent (20%) of total Gross Rentable Area, (ii)
ceiling clearance height is not less than twenty-two (22) feet, and (iii) the
average amount of Gross Rentable Area covered by each Lease is not less than
20,000 square feet.
REAL ESTATE. All real property at any time owned or leased (as lessee
or sublessee) by the Borrower or any of its Subsidiaries.
RECORD. The grid attached to any Note, or the continuation of such
grid, or any other similar record, including computer records, maintained by
any Bank with respect to any Loan referred to in such Note.
REFERENCE BANK. Agent.
REGISTER. See Section 18.2.
REIT STATUS. With respect to the Borrower, its status as a real estate
investment trust as defined in Section 856(a) of the Code.
RELEASE. See Section 6.18(c)(iii).
15
RENT ROLL. A report prepared and certified by the Borrower or the
Guarantor, as applicable, showing for each unit its type, location, Gross
Rentable Area, occupancy status, lease expiration date, market rent, lease
rent and other information in substantially the form presented to the Banks
prior to the date hereof or in such other form as may have been approved by
the Agent, such approval not to be unreasonably withheld.
SEC. The federal Securities and Exchange Commission.
SHORT-TERM INVESTMENTS. Investments described in subsections (a)
through (g), inclusive, of Section 8.3.
STATE. A state of the United States of America.
SUBSIDIARY. Any corporation, association, partnership, trust, or other
business entity of which the designated parent shall at any time own directly
or indirectly through a Subsidiary or Subsidiaries at least a majority (by
number of votes or controlling interests) of the outstanding Voting Interests.
TEST PERIOD. See Section 9.2.
TOTAL COMMITMENT. The sum of the Commitments of the Banks, as in effect
from time to time.
TYPE. As to any Loan, its nature as a Base Rate Loan or a Eurodollar
Rate Loan.
UNENCUMBERED OPERATING PROPERTIES. Real Estate which is owned one
hundred percent (100%) in fee simple by the Borrower and the Guarantor and
which satisfies all of the following conditions:
(a) each of the Unencumbered Operating Properties shall be free and
clear of all Liens other than Liens permitted in Section 8.2(ii) and (iv);
(b) to the best of the Borrower's knowledge and belief, none of the
Unencumbered Operating Properties shall have any material environmental,
structural, title, survey or other defects that would give rise to a
materially adverse effect as to the value, use of or ability to sell or
refinance such property; and
(c) each of the Unencumbered Operating Properties shall consist
solely of Real Estate (i) which is fully operational and (ii) with respect to
which valid certificates of occupancy for all Buildings thereon have been
issued and are in full force and effect;
Notwithstanding anything herein to the contrary, Unencumbered Operating
Properties shall only
16
be owned by the Guarantor to the extent necessary to reduce or minimize
franchise or other similar taxes computed with respect to the ownership
and/or operation of the Unencumbered Operating Properties.
VOTING INTERESTS. Stock or similar ownership interests, of any class or
classes (however designated), the holders of which are at the time entitled,
as such holders, (a) to vote for the election of a majority of the directors
(or persons performing similar functions) of the corporation, association,
partnership, trust or other business entity involved, or (b) to control,
manage, or conduct the business of the corporation, partnership, association,
trust or other business entity involved.
Section 1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to time
in accordance with its terms and the terms of this Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or modification
to such law.
(d) A reference to any Person includes its permitted successors
and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by generally accepted accounting principles applied
on a consistent basis by the accounting entity to which they refer.
(f) The words "include", "includes" and "including" are not
limiting.
(g) The words "approval" and "approved", as the context so
determines, means an approval in writing given to the party seeking approval
after full and fair disclosure to the party giving approval of all material
facts necessary in order to determine whether approval should be granted.
(h) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of Massachusetts, have the
meanings assigned to them therein.
(i) Reference to a particular "Section", refers to that section of
this Agreement unless otherwise indicated.
(j) The words "herein", "hereof", "hereunder" and words of like
import shall
17
refer to this Agreement as a whole and not to any particular section or
subdivision of this Agreement.
Section 2. THE REVOLVING CREDIT FACILITY.
Section 2.1. COMMITMENT TO LEND. Subject to the terms and conditions
set forth in this Agreement, each of the Banks severally agrees to lend to
the Borrower, and the Borrower may borrow (and repay and reborrow) from time
to time between the Closing Date and the Maturity Date upon notice by the
Borrower to the Agent given in accordance with Section 2.6, such sums as are
requested by the Borrower for the purposes set forth in Section 7.11 up to a
maximum aggregate principal amount Outstanding (after giving effect to all
amounts requested and the amount of Letters of Credit Outstanding, including
Letters of Credit accepted but unpaid) at any one time equal to such Bank's
Commitment (as limited by each Bank's Commitment Percentage of the Funding
Cap), PROVIDED, that, in all events no Default or Event of Default shall have
occurred and be continuing; and PROVIDED, FURTHER, that the Outstanding
principal amount of the Loans (after giving effect to all amounts requested
and the amount of Letters of Credit Outstanding, including Letters of Credit
accepted but unpaid) shall not at any time exceed the Total Commitment (as
limited by the Funding Cap) or cause a violation of the covenant set forth in
Section 9.4. The Loans shall be made PRO RATA in accordance with each
Bank's Commitment Percentage. The funding of a Loan hereunder shall
constitute a representation and warranty by the Borrower that all of the
conditions set forth in Section 10 and Section 11, in the case of the
initial Loan, and Section 11, in the case of all other Loans, have been
satisfied on the date of such funding. Notwithstanding anything to the
contrary contained in this Agreement, the aggregate amount of Outstanding
Loans and Outstanding Letters of Credit (including Letters of Credit accepted
but unpaid) shall not exceed the Funding Cap.
Section 2.2. FACILITY FEE. The Borrower agrees to pay to the Agent
for the accounts of the Banks in accordance with their respective Commitment
Percentages a facility fee calculated at the rate of one-fourth of one
percent (0.25%) per annum on the average daily amount by which the Total
Commitment exceeds the Outstanding principal amount of Loans and the amount
of Outstanding Letters of Credit (including Letters of Credit accepted but
unpaid) during each calendar quarter or portion thereof commencing on the
Closing Date and ending on the Maturity Date, provided, however, that in the
event for any quarter the ratio (expressed as a percentage) of (a) the
average daily amount of the Outstanding principal amount of the Loans and the
amount of Outstanding Letters of Credit (including Letters of Credit accepted
but unpaid) during such quarter to (b) the Total Commitment is greater than
sixty-five percent (65%), then the facility fee shall be calculated at the
rate of three-twentieths of one percent (0.15%) for such quarter. The
facility fee shall be payable quarterly in arrears on the last day of each
calendar quarter for such calendar quarter or portion thereof, with a final
payment on the Maturity Date.
Section 2.3. INTENTIONALLY OMITTED.
Section 2.4. NOTES. The Loans shall be evidenced by separate
promissory notes of the Borrower
18
in substantially the form of EXHIBIT A hereto (collectively, the "Notes"),
dated the date of this Agreement and completed with appropriate insertions.
One Note shall be payable to the order of each Bank in the principal face
amount equal to such Bank's Commitment and shall be payable as set forth
below. The Borrower irrevocably authorizes each Bank to make or cause to be
made, at or about the time of the Drawdown Date of any Loan or at the time of
receipt of any payment of principal thereof, an appropriate notation on such
Bank's Record reflecting the making of such Loan or (as the case may be) the
receipt of such payment. The Outstanding amount of the Loans set forth on
such Bank's Record shall be PRIMA FACIE evidence of the principal amount
thereof owing and unpaid to such Bank, but the failure to record, or any
error in so recording, any such amount on such Bank's Record shall not limit
or otherwise affect the obligations of the Borrower hereunder or under any
Note to make payments of principal of or interest on any Note when due.
By delivery of the Notes, there shall not be deemed to have occurred, and
there has not otherwise occurred, any payment, satisfaction or novation of
the indebtedness evidence by the "Notes" as defined in the Original Credit
Agreement, which indebtedness is instead allocated among the Banks as of the
date hereof and evidenced by the Notes in accordance with their respective
Commitment Percentages.
Section 2.5. INTEREST ON LOANS.
(a) Each Base Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the date on which
such Base Rate Loan is repaid or converted to a Eurodollar Rate Loan at the
rate per annum equal to the Base Rate.
(b) Each Eurodollar Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of the
Interest Period with respect thereto at the rate per annum equal to the sum
of the Eurodollar Rate determined for such Interest Period.
(c) The Borrower promises to pay interest on each Loan in arrears
on each Interest Payment Date with respect thereto.
(d) Base Rate Loans and Eurodollar Rate Loans may be converted to
Loans of the other Type as provided in Section 4.1.
Section 2.6. REQUESTS FOR LOANS. Except with respect to the initial
Loan, the Borrower (i) shall notify the Agent of a potential request for a
Loan as soon as possible but not less than five (5) Business Days prior to
the Borrower's proposed Drawdown Date, and (ii) shall give to the Agent
written notice in the form of EXHIBIT B hereto (or telephonic notice
confirmed in writing in the form of EXHIBIT B hereto) of each Loan requested
hereunder (a "Loan Request") no less than three (3) Business Days prior to
the proposed Drawdown Date. The Agent shall promptly notify each of the
Banks following the receipt of a Loan Request, but in any event not less than
three (3) Business Days prior to the proposed Drawdown Date. Borrower shall
not make a Loan
19
Request more frequently than three (3) times each month. Each such notice
shall specify with respect to the requested Loan the proposed principal
amount, Drawdown Date, Interest Period (if applicable) and Type. Each such
notice shall also contain (i) a statement as to the purpose for which such
advance shall be used (which purpose shall be in accordance with the terms of
Section 7.11), (ii) a certification by an Authorized Officer of the Borrower
and the Guarantor that since the date of the last Compliance Certificate
delivered under this Agreement, there have been no material changes in the
matters certified in such Compliance Certificate that could cause a Default
or Event of Default to occur after giving effect to the making of such Loan,
and (iii) a certification by an Authorized Officer of the Borrower that the
Borrower is and will be in compliance with Section 9.4 after giving effect
to the making of such Loan. Promptly upon receipt of any such notice, the
Agent shall notify each of the Banks thereof. Except as provided in this
Section 2.6, each such Loan Request shall be irrevocable and binding on the
Borrower and shall obligate the Borrower to accept the Loan requested from
the Banks on the proposed Drawdown Date, provided that, in addition to the
Borrower's other remedies against any Bank which fails to advance its
proportionate share of a requested Loan, such Loan Request may be revoked by
the Borrower by notice received by the Agent no later than the Drawdown Date
if any Bank fails to advance its proportionate share of the requested Loan in
accordance with the terms of this Agreement, provided further that the
Borrower shall be liable in accordance with the terms of this Agreement to
any Bank which is prepared to advance its proportionate share of the
requested Loan for any costs, expenses or damages incurred by such Bank as a
result of the Borrower's election to revoke such Loan Request (including,
without limitation, the items described in Section 4.8, as applicable, but
not including any damages for lost interest earnings as a result of such Loan
not being made). Nothing herein shall prevent the Borrower from seeking
recourse against any Bank that fails to advance its proportionate share of a
requested Loan as required by this Agreement. The Borrower may without cost
or penalty revoke a Loan Request by delivering notice thereof to each of the
Banks no later than three (3) Business Days prior to the Drawdown Date. Each
Loan Request shall be (a) for a Base Rate Loan in a minimum aggregate amount
of $1,000,000 or an integral multiple of $100,000 in excess thereof, or (b)
for a Eurodollar Rate Loan in a minimum aggregate amount of $1,000,000 or an
integral multiple of $100,000 in excess thereof; PROVIDED, HOWEVER, that
there shall be no more than five (5) Eurodollar Rate Loans outstanding at any
one time.
Section 2.7. FUNDS FOR LOANS. Not later than 2:00 p.m. (Boston time)
on the proposed Drawdown Date of any Loans, each of the Banks will make
available to the Agent, at the Agent's Head Office, in immediately available
funds, the amount of such Bank's Commitment Percentage of the amount of the
requested Loans which may be disbursed pursuant to Section 2.1. Upon
receipt from each Bank of such amount, and upon receipt of the documents
required by Section 10 and Section 11 and the satisfaction of the other
conditions set forth therein, to the extent applicable, the Agent will make
available to the Borrower the aggregate amount of such Loans made
available to the Agent by the Banks by crediting such amount to the account
of the Borrower maintained at the Agent's Head Office. The failure or
refusal of any Bank to make available to the Agent at the aforesaid time and
place on any Drawdown Date the amount of its Commitment Percentage of the
requested Loans shall not relieve any other Bank from its several obligation
hereunder to make available to the Agent by the Banks by crediting such
amount to the account of the Borrower maintained at the Agent's Head Office.
The failure or refusal of any Bank to make available to the Agent at the
aforesaid time and place on any Drawdown Date the amount of its Commitment
Percentage of the requested Loans shall not relieve any other Bank from its
serveral obligationa hereunder to make
20
available to the Agent the amount of such other Bank's Commitment Percentage
of any requested Loans, including any additional Loans that may be requested
subject to the terms and conditions hereof to provide funds to replace those
not advanced by the Bank so failing or refusing, provided that the Borrower
may by notice received by the Agent no later than the Drawdown Date refuse to
accept any Loan which is not fully funded in accordance with the Borrower's
Loan Request subject to the terms of Section 2.6. In the event of any such
failure or refusal, the Banks not so failing or refusing shall be entitled to
a priority position as against the Bank or Banks so failing or refusing for
such Loans as provided in Section 12.5.
Section 2.8. EXTENSION OF MATURITY DATE.
(a) The Borrower has requested the ability to extend the Maturity
Date. The Borrower acknowledges and agrees that the Banks have no agreement or
obligation to extend the Maturity Date. Notwithstanding the foregoing, the
Borrower and the Banks have agreed upon the following procedure with respect to
requests by the Borrower to extend the Maturity Date:
(i) The Borrower may request that the Banks extend the
Maturity Date by one (1) year. If the Borrower desires to request that the
Maturity Date be extended by one (1) year, the Borrower shall deliver
written notice of such request to the Agent not earlier than the first
anniversary of the Closing Date and not later than the date which is ninety
(90) days prior to the then effective Maturity Date (an "Extension
Request"). The Agent shall provide a copy of such notice to each of the
Banks within ten (10) days after the Agent's receipt of such notice. The
Banks shall notify the Agent within forty-five (45) days of receipt of such
notice from the Agent of such Bank's approval or rejection of the Extension
Request. No Extension Request shall be deemed approved unless approved by
all of the Banks, which approval may be granted or withheld in each
Bank's sole and absolute discretion. In the event that a Bank
shall fail to respond in writing to the Agent within such forty-five
(45) day period, such Bank shall be deemed to have rejected the Extension
Request. The Agent shall promptly notify the Borrower of the responses
received from the Banks with respect to the Extension Request.
(ii) If the Extension Request is approved by all of the
Banks as provided in Section 2.8(a)(i), the Borrower shall retain the
right to request further one (1) year extensions in the manner provided
in this Section 2.8(a).
(b) In the event that an Extension Request is approved as
provided in Section 2.8(a), each and every such approval shall be
conditioned upon satisfaction of the following conditions precedent, which
terms shall be in addition to any terms and conditions which may be required
by the Banks as a condition to the approval of the Extension Request and must
be satisfied prior to the effectiveness of any extension of the Maturity Date:
(i) PAYMENT OF EXTENSION FEE. Within fifteen (15) days of
approval of the Extension Request by all of the Banks (but in no event
later than the Maturity Date as
-21-
determined without regard to such extension), the Borrower
shall pay to the Agent for the PRO RATA accounts of the Banks in accordance
with their respective Commitment Percentages an extension fee equal to
one-fifth of one percent (0.2%) of the Total Commitment, which fee
shall, when paid, be fully earned and non-refundable under any
circumstances.
(ii) NO DEFAULT. On the date the Extension Request is given
and on the Maturity Date (as determined without regard to such extension)
there shall exist no Default or Event of Default.
(iii) REPRESENTATIONS AND WARRANTIES. The representations and
warranties made by the Borrower or the Guarantor in the Loan Documents or
otherwise made by or on behalf of the Borrower, the Guarantor or any of the
Borrower's Subsidiaries in connection therewith or after the date thereof
shall have been true and correct in all material respects when made and
shall also be true and correct in all material respects on the Maturity
Date (as determined without regard to such extension) other than for
changes in the ordinary course of business permitted by this Agreement that
have not had any materially adverse affect on the business of the Borrower,
the Guarantor or any of the Borrower's Subsidiaries.
Section 2.9. LETTERS OF CREDIT.
(a) Subject to the terms and conditions set forth in this
Agreement, at any time and from time to time from the Closing Date through
the day that is thirty (30) days prior to the Maturity Date, the Agent shall
issue such Letters of Credit as the Borrower may request, for the purposes
provided in Section 7.11, upon the delivery of a written request in the form
of EXHIBIT C hereto (a "Letter of Credit Request") to the Agent, PROVIDED
that (i) upon issuance of such Letter of Credit, the sum of all Outstanding
Loans plus Outstanding Letters of Credit (including Letters of Credit
accepted but unpaid) shall not exceed the Funding Cap, (ii) upon issuance of
such Letter of Credit, the Outstanding Letters of Credit (including Letters
of Credit accepted but unpaid) shall not exceed Six Million Dollars
($6,000,000.00), (iii) the conditions set forth in Section 10 and 11 shall
have been satisfied, and (iv) in no event shall any amount drawn under a
Letter of Credit be available for reinstatement or a subsequent drawing under
such Letter of Credit. The Borrower assumes all risks with respect to the
use of the Letters of Credit. Unless the Agent and the Majority Banks
otherwise consent, the term of any Letter of Credit shall not exceed the
lesser of twelve (12) months or a period of time commencing on the issuance
of the Letter of Credit and ending on the date which is fifteen (15) days
prior to the Maturity Date (but in any event the term shall not extend beyond
the Maturity Date), and no Letter of Credit shall contain an automatic
extension or renewal clause. The amount available to be drawn under any
Letter of Credit shall reduce on a dollar for dollar basis the amount
available to be drawn under the Total Commitment (as limited by the Funding
Cap) as a Loan.
(b) Each Letter of Credit Request shall be
submitted to the Agent at least ten (10) Business Days prior to the date upon
which the requested Letter of Credit is to be issued.
-22-
Following the receipt of a Letter of Credit Request, the Agent shall promptly
notify each of the Banks of the Letter of Credit Request. Each such Letter
of Credit Request shall contain (i) a statement as to the purpose for which
such Letter of Credit shall be used (which purpose shall be in accordance
with the terms of Section 7.11), (ii) a certification by an Authorized
Officer of the Borrower that the Borrower is and will be in compliance with
all covenants under the Loan Documents after giving effect to the issuance of
such Letter of Credit, and (iii) a certification by an Authorized Officer of
the Borrower that the Borrower is and will be in compliance with
Section 7.15 after giving effect to the issuance of the Letter of Credit.
The Borrower shall further deliver to the Agent such additional applications
and documents as the Agent may require, in conformity with the then standard
practices of its letter of credit department, in connection with the issuance
of such Letter of Credit; provided that in the event of any conflict, the
terms of this Agreement shall control.
(c) The Agent shall, if it approves of the content of the Letter
of Credit Request (which approval shall not be unreasonably withheld), and
subject to the conditions set forth in this Agreement, issue the Letter of
Credit on or before ten (10) Business Days following receipt of the documents
last due pursuant to Section 2.9(b). Each Letter of Credit shall be in form
and substance satisfactory to the Agent in its sole discretion. Upon
issuance of a Letter of Credit, the Agent shall provide copies of each Letter
of Credit to the Banks.
(d) Upon the issuance of a Letter of Credit, each Bank shall be
deemed to have purchased a participation therein from Agent in an amount equal
to its respective Commitment Percentage of the amount of such Letter of Credit.
(e) Upon the issuance of each Letter of Credit, the Borrower shall
pay to the Agent (i) for its own account, a Letter of Credit fee calculated at
the rate of one-half of one percent (0.5%) per annum of the amount available to
be drawn under such Letter of Credit (which fee shall not be less than $1,000.00
in any event), and (ii) for the accounts of the Banks in accordance with their
respective percentage shares of participation in such Letter of Credit, a Letter
of Credit fee calculated at the rate of one and one-fifth percent (1.2%) per
annum of the amount available to be drawn under such Letter of Credit. Such
fees shall be payable in quarterly installments in advance with respect to each
Letter of Credit commencing on its date of issuance and continuing on each
quarter thereafter, as applicable.
(f) If and to the extent that any amounts are drawn upon any
Letter of Credit, the amounts so drawn shall, from the date of payment
thereof by the Agent, be considered Loans for all purposes hereunder bearing
interest as provided in Section 2.5(a). The Banks shall be required to make
such Loans regardless of whether all of the conditions to disbursement set
forth in Section 11 have been satisfied.
(g) Upon the receipt by the Agent of any draw or other presentation
for payment of a Letter of Credit and the payment of any amount under a Letter
of Credit, the Agent shall, without notice to or the consent of the Borrower,
direct the Banks to fund to the Agent in
-23-
accordance with Section 2.7 on or before 2:00 p.m. (Boston time) on the next
Business Day their respective Commitment Percentages of the amount so paid by
the Agent. The proceeds of such funding shall be paid to the Agent to
reimburse the Agent for the payment made by it under the Letter of Credit.
The provisions of Section 2.7 shall apply to any Bank or Banks failing or
refusing to fund its Commitment Percentage of any such draw.
(h) The issuance of any supplement, modification, amendment, renewal
or extension to or of any Letter of Credit shall be treated in all respects the
same as the issuance of a new Letter of Credit.
Section 3. REPAYMENT OF THE LOANS.
Section 3.1. STATED MATURITY. The Borrower promises to pay on the
Maturity Date and there shall become absolutely due and payable on the
Maturity Date, all of the Loans Outstanding on such date, together with any
and all accrued and unpaid interest thereon.
Section 3.2. MANDATORY PREPAYMENTS. If at any time the aggregate
Outstanding principal amount of the Loans and Outstanding Letters of Credit
(including Letters of Credit accepted but unpaid) exceeds the Funding Cap,
then the Borrower shall immediately pay the amount of such excess to the
Agent for the respective accounts of the Banks for application to the Loans.
If at any time the Borrower is not in compliance with the covenants contained
in Section 9.4, the Borrower shall pay to the Agent for the accounts of the
Banks so much of the Outstanding principal amounts of the Loans as is
necessary to cause the Borrower to be in compliance with Section 9.4.
Section 3.3. OPTIONAL PREPAYMENTS. The Borrower shall have the right,
at its election, to prepay the Outstanding amount of the Loans, as a whole or
in part, at any time without penalty or premium; PROVIDED, that the full or
partial prepayment of the Outstanding amount of any Eurodollar Rate Loans
pursuant to this Section 3.3 may be made only on the last day of the
Interest Period relating thereto unless accompanied by breakage costs
computed in accordance with Section 4.8 and except as otherwise required
pursuant to Section 4.7. The Borrower shall give the Agent, no later than
1:00 p.m., Boston time, at least three (3) Business Days prior written notice
of any prepayment pursuant to this Section 3.3 specifying the proposed date
of payment of Loans and the principal amount to be paid.
Section 3.4. PARTIAL PREPAYMENTS. Each partial prepayment of the
Loans under Section 3.2 and Section 3.3 shall be in an integral multiple of
$500,000, shall be accompanied by the payment of accrued interest on the
principal prepaid to the date of payment and, after payment of such interest,
shall be applied, in the absence of instruction by the Borrower, first to the
principal of Base Rate Loans and then to the principal of Eurodollar Rate
Loans.
Section 3.5. EFFECT OF PREPAYMENTS. Amounts of the Loans
prepaid under Section 3.2 and Section 3.3 prior to the Maturity Date may be
reborrowed as provided in Section 2.
-24-
Section 3.6. PROCEEDS FROM DEBT OFFERING AND EQUITY OFFERING. Upon
the occurrence of a Default or Event of Default and during any period during
which such Default or Event of Default shall be continuing, the Borrower
shall cause all gross proceeds of each and every Debt Offering and Equity
Offering, less all reasonable costs, fees, expenses, underwriting
commissions, fees and discounts incurred in connection therewith, to be
promptly paid by the Borrower to the Agent for the account of the Banks as a
prepayment of the Loans to the extent of the Outstanding balance of the Loans.
Section 4. CERTAIN GENERAL PROVISIONS.
Section 4.1. CONVERSION OPTIONS.
(a) The Borrower may elect from time to time to convert
any outstanding Loan to a Loan of another Type and such Loan shall thereafter
bear interest as a Base Rate Loan or a Eurodollar Rate Loan, as applicable;
PROVIDED that (i) with respect to any such conversion of a Eurodollar Rate
Loan to a Base Rate Loan, the Borrower shall give the Agent at least three
Business Days' prior written notice of such election, and such conversion
shall only be made on the last day of the Interest Period with respect to
such Eurodollar Rate Loan; (ii) with respect to any such conversion of a Base
Rate Loan to a Eurodollar Rate Loan, the Borrower shall give the Agent at
least four Eurodollar Business Days' prior written notice of such election
and the Interest Period requested for such Loan, the principal amount of the
Loan so converted shall be in a minimum aggregate amount of $1,000,000 or an
integral multiple of $100,000 in excess thereof and, after giving effect to
the making of such Loan, there shall be no more than five (5) Eurodollar Rate
Loans Outstanding at any one time; and (iii) no Loan may be converted into a
Eurodollar Rate Loan when any Default or Event of Default has occurred and is
continuing. All or any part of the Outstanding Loans of any Type may be
converted as provided herein, PROVIDED that no partial conversion shall
result in a Base Rate Loan in an aggregate principal amount of less than
$1,000,000 or a Eurodollar Rate Loan in an aggregate principal amount of less
than $1,000,000 and that the aggregate principal amount of each Loan shall be
in an integral multiple of $100,000. On the date on which such conversion is
being made, each Bank shall take such action as is necessary to transfer its
Commitment Percentage of such Loans to its Domestic Lending Office or its
Eurodollar Lending Office, as the case may be. Each Conversion Request
relating to the conversion of a Base Rate Loan to a Eurodollar Rate Loan
shall be irrevocable by the Borrower.
(b) Any Loan may be continued as such Type upon the
expiration of an Interest Period with respect thereto by compliance by the
Borrower with the terms of Section 4.1; PROVIDED that no Eurodollar Rate
Loan may be continued as such when any Event of Default has occurred and is
continuing, but shall be automatically converted to a Base Rate Loan on the
last day of the Interest Period relating thereto ending during the
continuance of any Event of Default.
(c) In the event that the Borrower does not notify the
Agent of its election hereunder with respect to any Loan, such Loan shall be
automatically converted to a Base Rate
-25-
Loan at the end of the applicable Interest Period.
Section 4.2. COMMITMENT FEE. The Borrower agrees to pay $125,000.00
on or before the Closing Date to the Agent for the account of the Banks in
accordance with their respective Commitment Percentages as a commitment fee.
Section 4.3. INTENTIONALLY OMITTED.
Section 4.4. FUNDS FOR PAYMENTS.
(a) All payments of principal, interest, facility fees,
Agent's fees, closing fees, Letter of Credit fees and any other amounts due
hereunder or under any of the other Loan Documents shall be made to the
Agent, for the respective accounts of the Banks and the Agent, as the case
may be, at the Agent's Head Office, not later than 1:00 p.m. (Boston time) on
the day when due, in each case in immediately available funds. The Agent is
hereby authorized to charge the account of the Borrower with FNBB, on the
dates when the amount thereof shall become due and payable, with the amounts
of the principal of and interest on the Loans and all fees, charges, expenses
and other amounts owing to the Agent and/or the Banks under the Loan
Documents.
(b) All payments by the Borrower hereunder and under any
of the other Loan Documents shall be made without setoff or counterclaim and
free and clear of and without deduction for any taxes, levies, imposts,
duties, charges, fees, deductions, withholdings, compulsory loans,
restrictions or conditions of any nature now or hereafter imposed or levied
by any jurisdiction or any political subdivision thereof or taxing or other
authority therein unless the Borrower is compelled by law to make such
deduction or withholding. If any such obligation is imposed upon the
Borrower with respect to any amount payable by it hereunder or under any of
the other Loan Documents, the Borrower will pay to the Agent, for the account
of the Banks or (as the case may be) the Agent, on the date on which such
amount is due and payable hereunder or under such other Loan Document, such
additional amount in Dollars as shall be necessary to enable the Banks or the
Agent to receive the same net amount which the Banks or the Agent would have
received on such due date had no such obligation been imposed upon the
Borrower. The Borrower will deliver promptly to the Agent certificates or
other valid vouchers for all taxes or other charges deducted from or paid
with respect to payments made by the Borrower hereunder or under such other
Loan Document.
(c) The obligations of the Borrower to the Banks under
this Agreement shall be absolute, unconditional and irrevocable, and shall be
paid and performed strictly in accordance with the terms of this Agreement,
under all circumstances whatsoever, including, without limitation, the
following circumstances: (i) any improper use which may be made of any
Letter of Credit or any improper acts or omissions of any beneficiary or
transferee of any Letter of Credit in connection therewith; (ii) the
existence of any claim, set-off, defense or any right which the Borrower may
have at any time against any beneficiary or any transferee of any Letter
-26-
of Credit (or persons or entities for whom any such beneficiary or any such
transferee may be acting) or the Banks (other than the defense of payment to
the Banks in accordance with the terms of this Agreement) or any other
person, whether in connection with any Letter of Credit, this Agreement, any
other Loan Document, or any unrelated transaction; (iii) any statement or any
other documents presented under any Letter of Credit proving to be
insufficient, forged, fraudulent or invalid in any respect or any statement
therein being untrue or inaccurate in any respect whatsoever; (iv) any breach
of any agreement between Borrower and any beneficiary or transferee of any
Letter of Credit; (v) any irregularity in the transaction with respect to
which any Letter of Credit is issued, including any fraud by the beneficiary
or any transferee of such Letter of Credit; (vi) payment by the Agent under
any Letter of Credit against presentation of a sight draft or a certificate
which does not comply with the terms of such Letter of Credit, provided that
such payment shall not have constituted gross negligence or willful
misconduct on the part of the Agent, and (vii) any other circumstance or
happening whatsoever, whether or not similar to any of the foregoing,
provided that such other circumstances or happenings shall not have been the
result of gross negligence or willful misconduct on the part of the Agent.
(d) Each Bank organized under the laws of a jurisdiction
outside the United States, if requested in writing by the Borrower (but only
so long as such Bank remains lawfully able to do so), shall provide the
Borrower with such duly executed form(s) or statement(s) which may, from time
to time, be prescribed by law and, which, pursuant to applicable provisions
of (i) an income tax treaty between the United States and the country of
residence of such Bank, (ii) the Code, or (iii) any applicable rules or
regulations in effect under (i) or (ii) above, indicating the withholding
status of such Bank; provided that nothing herein (including without
limitation the failure or inability to provide such form or statement) shall
relieve the Borrower of its obligations under Section 4.4(b). In the event
that the Borrower shall have delivered the certificates or vouchers described
above for any payments made by the Borrower and such Bank receives a refund
of any taxes paid by the Borrower pursuant to Section 4.4(b), such Bank will
pay to the Borrower the amount of such refund promptly upon receipt thereof,
PROVIDED that if at any time thereafter such Bank is required to return such
refund, the Borrower shall promptly repay to such Bank the amount of such
refund.
Section .4.5 COMPUTATIONS. All computations of interest on the Loans
and of other fees to the extent applicable shall be based on a 360-day year
and paid for the actual number of days elapsed. Except as otherwise provided
in the definition of the term "Interest Period" with respect to Eurodollar
Rate Loans, whenever a payment hereunder or under any of the other Loan
Documents becomes due on a day that is not a Business Day, the due date for
such payment shall be extended to the next succeeding Business Day, and
interest shall accrue during such extension. The Outstanding amount of the
Loans as reflected on the records of the Agent from time to time shall be
considered PRIMA FACIE evidence of such amount.
Section 4.6. INABILITY TO DETERMINE EURODOLLAR RATE. In the event
that, prior to the commencement of any Interest Period relating to any
Eurodollar Rate Loan, the Agent shall determine that adequate and reasonable
methods do not exist for ascertaining the Eurodollar Rate
-27-
for such Interest Period, the Agent shall forthwith give notice of such
determination (which shall be conclusive and binding on the Borrower and the
Banks) to the Borrower and the Banks. In such event (a) any Loan Request
with respect to Eurodollar Rate Loans shall be automatically withdrawn and
shall be deemed a request for Base Rate Loans and (b) each Eurodollar Rate
Loan will automatically, on the last day of the then current Interest Period
thereof, become a Base Rate Loan, and the obligations of the Banks to make
Eurodollar Rate Loans shall be suspended until the Agent determines that the
circumstances giving rise to such suspension no longer exist, whereupon the
Agent shall so notify the Borrower and the Banks.
Section 4.7. ILLEGALITY. Notwithstanding any other provisions herein,
if any present or future law, regulation, treaty or directive or the
interpretation or application thereof shall make it unlawful, or any central
bank or other governmental authority having jurisdiction over a Bank or its
Eurodollar Lending Office shall assert that it is unlawful, for any Bank to
make or maintain Eurodollar Rate Loans, such Bank shall forthwith give notice
of such circumstances to the Agent and the Borrower and thereupon (a) the
commitment of the Banks to make Eurodollar Rate Loans or convert Loans of
another type to Eurodollar Rate Loans shall forthwith be suspended and (b)
the Eurodollar Rate Loans then Outstanding shall be converted automatically
to Base Rate Loans on the last day of each Interest Period applicable to such
Eurodollar Rate Loans or within such earlier period as may be required by law.
Section 4.8. ADDITIONAL INTEREST. If any Eurodollar Rate Loan or any
portion thereof is repaid or is converted to a Base Rate Loan for any reason
on a date which is prior to the last day of the Interest Period applicable to
such Eurodollar Rate Loan, the Borrower will pay to the Agent upon demand for
the account of the Banks in accordance with their respective Commitment
Percentages, in addition to any amounts of interest otherwise payable
hereunder, any amounts required to compensate the Banks for any losses, costs
or expenses which may reasonably be incurred as a result of such payment or
conversion, including, without limitation, an amount equal to daily interest
for the unexpired portion of such Interest Period on the Eurodollar Rate Loan
or portion thereof so repaid or converted at a per annum rate equal to the
excess, if any, of (a) the Eurodollar Rate applicable to such Eurodollar Rate
Loan minus one and seven tenths percent (1.7%) over (b) the yield obtainable
by the Agent upon the purchase of debt securities customarily issued by the
Treasury of the United States of America which have a maturity date most
closely approximating the last day of such Interest Period (it being
understood that the purchase of such securities shall not be required in
order for such amounts to be payable) (it being agreed that a Bank shall not
be obligated or required to have actually obtained funds at the Eurodollar
Rate or to have actually reinvested such amount as described above).
Section 4.9. ADDITIONAL COSTS, ETC. Notwithstanding anything herein
to the contrary, if any present or future applicable law, which expression,
as used herein, includes statutes, rules and regulations thereunder and
legally binding interpretations thereof by any competent court or by any
governmental or other regulatory body or official with appropriate
jurisdiction charged with the administration or the interpretation thereof
and requests, directives, instructions and notices at any time or from time
to time hereafter made upon or otherwise issued to any Bank or the Agent
-28-
by any central bank or other fiscal, monetary or other authority (whether or not
having the force of law), shall:
(a) subject any Bank or the Agent to any tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature with respect to
this Agreement, the other Loan Documents, such Bank's Commitment, a Letter of
Credit or the Loans (other than taxes based upon or measured by the income or
profits of such Bank or the Agent), or
(b) materially change the basis of taxation (except for
changes in taxes on income or profits) of payments to any Bank of the
principal of or the interest on any Loans or any other amounts payable to any
Bank under this Agreement or the other Loan Documents, or
(c) impose or increase or render applicable any special
deposit, reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held by,
or deposits in or for the account of, or loans by, or letters of credit from,
or commitments of any Bank beyond those in effect as of the date hereof, or
(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Agreement, the other Loan Documents, the
Loans, such Bank's Commitment, a Letter of Credit or any class of loans or
commitments of which any of the Loans or such Bank's Commitment forms a part;
and the result of any of the foregoing is
(i) to increase the cost to any Bank of making,
funding, issuing, renewing, extending or maintaining any of the Loans or
Letters of Credit or such Bank's Commitment, or
(ii) to reduce the amount of principal, interest or
other amount payable to such Bank or the Agent hereunder on account of
such Bank's Commitment or any of the Loans or Letters of Credit, or
(iii) to require such Bank or the Agent to make any
payment or to forego any interest or other sum payable hereunder, the
amount of which payment or foregone interest or other sum is calculated
by reference to the gross amount of any sum receivable or deemed
received by such Bank or the Agent from the Borrower hereunder,
then, and in each such case, the Borrower will, within fifteen (15) days of
demand made by such Bank or (as the case may be) the Agent at any time and
from time to time and as often as the occasion therefor may arise, pay to
such Bank or the Agent such additional amounts as such Bank or the Agent
shall determine in good faith to be sufficient to compensate such Bank or the
Agent for such additional cost, reduction, payment or foregone interest or
other sum. Each Bank and the Agent in determining such amounts may use any
reasonable averaging and attribution methods, generally applied by such Bank
or the Agent.
Section 4.10. CAPITAL ADEQUACY. If after the date hereof any Bank
determines that (a) the
-29-
adoption of or change in any law, rule, regulation or guideline
regarding capital requirements of general application for banks or bank holding
companies (as opposed to a particular bank) or any change in the interpretation
or application thereof by any governmental authority charged with the
administration thereof, or (b) compliance by such Bank or its parent bank
holding company with any future guideline, request or directive of any such
entity regarding capital adequacy or any amendment or change in interpretation
of any existing guideline, request or directive (whether or not having the force
of law), has the effect of reducing the return on such Bank's or such holding
company's capital as a consequence of such Bank's commitment to make Loans
hereunder to a level below that which such Bank or holding company could have
achieved but for such adoption, change or compliance (taking into consideration
such Bank's or such holding company's then existing policies with respect to
capital adequacy and assuming the full utilization of such entity's capital) by
any amount deemed by such Bank to be material, then such Bank may notify the
Borrower thereof. The Borrower agrees to pay to such Bank the amount of such
reduction in the return on capital as and when such reduction is determined,
upon presentation by such Bank of a statement of the amount setting for the
Bank's calculation thereof. In determining such amount, such Bank may use any
reasonable averaging and attribution methods, generally applied by such Bank.
Section 4.11. INDEMNITY OF BORROWER. The Borrower agrees to indemnify
each Bank and to hold each Bank harmless from and against any loss, cost or
expense that such Bank may sustain or incur as a consequence of (a) default
by the Borrower in payment of the principal amount of or any interest on any
Eurodollar Rate Loans as and when due and payable, including any such loss or
expense arising from interest or fees payable by such Bank to lenders of
funds obtained by it in order to maintain its Eurodollar Rate Loans, or (b)
default by the Borrower in making a borrowing or conversion after the
Borrower has given (or is deemed to have given) a Loan Request or a
Conversion Request; provided, however, that the Borrower shall not be
required to so indemnify any Bank pursuant to clause (b) above which fails or
refuses to fund its proportionate share of a Loan in accordance with the
terms of this Agreement.
Section 4.12. INTEREST ON OVERDUE AMOUNTS; LATE CHARGE. Overdue
principal and (to the extent permitted by applicable law) interest on the
Loans and all other overdue amounts payable hereunder or under any of the
other Loan Documents shall bear interest payable on demand at a rate per
annum equal to four percent (4%) above the Base Rate until such amount shall
be paid in full (after as well as before judgment). In addition, the
Borrower shall pay a late charge equal to three percent (3%) of any amount of
interest and/or principal payable on the Loans or any other amounts payable
hereunder or under the Loan Documents, which is not paid within ten days of
the date when due.
Section 4.13. CERTIFICATE. A certificate setting forth any amounts
payable pursuant to Section 4.8, Section 4.9, Section 4.10, Section 4.11
or Section 4.12 and a brief explanation of such amounts which are due,
submitted by any Bank or the Agent to the Borrower, shall be conclusive in
the absence of manifest error.
Section 4.14. LIMITATION ON INTEREST. Notwithstanding anything in
this Agreement to the
-30-
contrary, all agreements between the Borrower and the Banks and the Agent,
whether now existing or hereafter arising and whether written or oral, are
hereby limited so that in no contingency, whether by reason of acceleration
of the maturity of any of the Obligations or otherwise, shall the interest
contracted for, charged or received by the Banks exceed the maximum amount
permissible under applicable law. If, from any circumstance whatsoever,
interest would otherwise be payable to the Banks in excess of the maximum
lawful amount, the interest payable to the Banks shall be reduced to the
maximum amount permitted under applicable law; and if from any circumstance
the Banks shall ever receive anything of value deemed interest by applicable
law in excess of the maximum lawful amount, an amount equal to any excessive
interest shall be applied to the reduction of the principal balance of the
Obligations and to the payment of interest or, if such excessive interest
exceeds the unpaid balance of principal of the Obligations, such excess shall
be refunded to the Borrower. All interest paid or agreed to be paid to the
Banks shall, to the extent permitted by applicable law, be amortized,
prorated, allocated and spread throughout the full period until payment in
full of the principal of the Obligations (including the period of any renewal
or extension thereof) so that the interest thereon for such full period shall
not exceed the maximum amount permitted by applicable law. This section
shall control all agreements between the Borrower and the Banks and the
Agent.
Section 5. SECURITY. The Banks have agreed to make the Loans to the
Borrower on an unsecured basis. Notwithstanding the foregoing, the
Obligations shall be guaranteed by Guarantor pursuant to the Guaranty.
Section 6. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Agent and the Banks as follows:
Section 6.1. CORPORATE AUTHORITY, ETC.
(a) INCORPORATION; GOOD STANDING. The Borrower (i) is a
corporation duly organized pursuant to its organizational documents and
amendments thereto filed with the Department of Assessments and Taxation of
Maryland and is validly existing and in good standing under the laws of the
State of Maryland, (ii) has all requisite power to own its property and
conduct its business as now conducted and as presently contemplated, (iii) is
in good standing as a foreign entity and is duly authorized to do business in
the jurisdictions where the Unencumbered Operating Properties are located to
the extent required to be so authorized and in each other jurisdiction where
a failure to be so qualified in such other jurisdiction could have a
materially adverse effect on the business, assets or financial condition of
the Borrower and (iv) is a real estate investment trust in full compliance
with and entitled to the benefits of Section 856 of the Code.
(b) SUBSIDIARIES. Each of the Subsidiaries of the Borrower
(including the Guarantor) (i) is a corporation, limited partnership, limited
liability company or trust duly organized under the laws of its State of
organization and is validly existing and in good standing
-31-
under the laws thereof, (ii) has all requisite power to own its property and
conduct its business as now conducted and as presently contemplated and (iii)
is in good standing and is duly authorized to do business in each
jurisdiction where a failure to be so qualified could have a materially
adverse effect on the business, assets or financial condition of the Borrower
or such Subsidiary.
(c) AUTHORIZATION. The execution, delivery and performance of
this Agreement and the other Loan Documents and the transactions contemplated
hereby and thereby (i) are within the authority of the Borrower and the
Guarantor, (ii) have been duly authorized by all necessary proceedings on the
part of the such Person, (iii) do not and will not conflict with or result in
any breach or contravention of any provision of law, statute, rule or
regulation to which such Person is subject or any judgment, order, writ,
injunction, license or permit applicable to such Person, (iv) do not and will
not conflict with or constitute a default (whether with the passage of time
or the giving of notice, or both) under any provision of the charter
documents, partnership agreement, declaration of trust or other charter
documents or bylaws of, or any agreement or other instrument binding upon,
such Person or any of its properties, and (v) do not and will not result in
or require the imposition of any lien or other encumbrance on any of the
properties, assets or rights of such Person.
(d) ENFORCEABILITY. The execution and delivery of this Agreement
and the other Loan Documents are valid and legally binding obligations of the
Borrower and the Guarantor enforceable in accordance with the respective
terms and provisions hereof and thereof, except as enforceability is limited
by bankruptcy, insolvency, reorganization, moratorium or other laws relating
to or affecting generally the enforcement of creditors' rights and except to
the extent that availability of the remedy of specific performance or
injunctive relief is subject to the discretion of the court before which any
proceeding therefor may be brought.
Section 6.2. GOVERNMENTAL APPROVALS. The execution, delivery and
performance by the Borrower and the Guarantor of this Agreement and the other
Loan Documents and the transactions contemplated hereby and thereby do not
require the approval or consent of, or filing with, any governmental agency
or authority other than those already obtained.
Section 6.3. TITLE TO PROPERTIES; LEASES. Except as indicated on
SCHEDULE 6.3 hereto, the Borrower and its Subsidiaries own all of the assets
reflected in the consolidated balance sheet of the Borrower as at the Balance
Sheet Date or acquired since that date (except property and assets sold or
otherwise disposed of in the ordinary course of business since that date),
subject to no rights of others, including any mortgages, leases (excluding
leases entered into in the ordinary course of the Borrower's business),
conditional sales agreements, title retention agreements, liens or other
encumbrances except Permitted Liens. Without limiting the foregoing, the
Borrower and its Subsidiaries have good and marketable fee simple title to,
or a valid and subsisting leasehold interest in, all real property reasonably
necessary for the operation of its business in whole, free from all liens or
encumbrances of any nature whatsoever, except for Permitted Liens. The
Borrower or its Subsidiary or the Guarantor, as the case may be, is the
insured under owner's policies of title insurance covering all real property
owned by it, in each case in an
-32-
amount not less than the purchase price for such real property. Neither the
Borrower nor the Guarantor is a party to a Lease with a tenant which accounts
for one-half percent (0.5%) or more of the total rental revenues of the
Borrower and in which Ameritech owns, directly or indirectly, more than a
nine and nine tenths percent (9.9%) interest.
Section 6.4. FINANCIAL STATEMENTS. The Borrower has furnished to each
of the Banks: (a) the pro forma consolidated balance sheet of the Borrower
and its Subsidiaries and of the Guarantor as of the Balance Sheet Date and
their related consolidated statements of income, changes in stockholder
equity and cash flows for the fiscal year then ended, certified by an
Authorized Officer of the Borrower and the Guarantor, as applicable, (b) a
pro forma consolidated balance sheet and a pro forma consolidated statement
of income and cash flows of the Borrower and its Subsidiaries and of the
Guarantor for each of the fiscal quarters of the Borrower ended since the
Balance Sheet Date certified by an Authorized Officer of the Borrower and the
Guarantor, as applicable, to have been prepared in accordance with generally
accepted accounting principles consistent with those used in the preparation
of the annual statements delivered pursuant to subsection (a) above and to
fairly present the financial condition of the Borrower and its Subsidiaries
and the Guarantor as at the close of business on the dates thereof and the
results of operations for the fiscal quarters then ended (subject to year-end
adjustments), and (c) an unaudited consolidated statement of Net Operating
Income for the Borrower and its Subsidiaries and the Guarantor and an
unaudited statement of Net Operating Income for each parcel of Real Estate
for the nine (9) months ended September 30, 1995, satisfactory in form to the
Majority Banks and certified by an Authorized Officer of the Borrower and the
Guarantor, as applicable, as fairly presenting the operating income for such
parcels for such periods. Such balance sheet and statements of income,
stockholder's equity and cash flows have been prepared in accordance with
generally accepted accounting principles and fairly present the financial
condition of the Borrower and its Subsidiaries and the Guarantor as of such
dates and the results of the operations of the Borrower and its Subsidiaries
and the Guarantor for such periods. There are no liabilities, contingent or
otherwise, of the Borrower or any of its Subsidiaries or the Guarantor
involving material amounts not disclosed in said financial statements and the
related notes thereto.
Section 6.5. NO MATERIAL CHANGES. Since the Balance Sheet Date, there
has occurred no materially adverse change in the financial condition or
business of the Borrower and its Subsidiaries or the Guarantor taken as a
whole as shown on or reflected in the consolidated balance sheet of the
Borrower and its Subsidiaries and the Guarantor, adjusted pursuant to
Section 9.7, as of the Balance Sheet Date, or its consolidated statement
of Net Operating Income or Operating Cash Flow for the Real Estate for the
fiscal year then ended, other than changes in the ordinary course of business
that have not had any materially adverse effect either individually or in the
aggregate on the business or financial condition of such Person.
Section 6.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. The Borrower and
its Subsidiaries and the Guarantor possess all franchises, patents,
copyrights, trademarks, trade names, servicemarks, licenses and permits, and
rights in respect of the foregoing, adequate for the conduct of their
business substantially as now conducted without known conflict with any
rights of others.
-33-
Section 6.7. LITIGATION. Except as stated on SCHEDULE
6.7 there are no actions, suits, proceedings or investigations of any kind
pending or threatened against the Borrower or any of its Subsidiaries or the
Guarantor before any court, tribunal or administrative agency or board that,
if adversely determined, might, either in any case or in the aggregate,
materially adversely affect the properties, assets, financial condition or
business of such Person or materially impair the right of such Person to
carry on business substantially as now conducted by it, or result in any
liability not adequately covered by insurance, or for which adequate reserves
are not maintained on the balance sheet of such Person, or which question the
validity of this Agreement or any of the other Loan Documents, any action
taken or to be taken pursuant hereto or thereto, or which will adversely
affect the ability of the Borrower or the Guarantor to pay and perform the
Obligations in the manner contemplated by this Agreement and the other Loan
Documents.
Section 6.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. Neither the
Borrower nor any of its Subsidiaries nor the Guarantor is subject to any
charter, corporate or other legal restriction, or any judgment, decree,
order, rule or regulation that has or is expected in the future to have a
materially adverse effect on the business, assets or financial condition of
the Borrower or any of its Subsidiaries or the Guarantor. Neither the
Borrower nor any of its Subsidiaries nor the Guarantor is a party to any
contract or agreement that has or is expected, in the judgment of the
officers of such Person, to have any materially adverse effect on the
business of any of them.
Section 6.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Neither
the Borrower nor any of its Subsidiaries nor the Guarantor is in violation of
any provision of its charter or other organizational documents, by-laws, or
any agreement or instrument to which it may be subject or by which it or any
of its properties may be bound or any decree, order, judgment, statute,
license, rule or regulation, in any of the foregoing cases in a manner that
could result in the imposition of substantial penalties or materially and
adversely affect the financial condition, properties or business of the
Borrower or its Subsidiaries or the Guarantor.
Section 6.10. TAX STATUS. The Borrower and each of its Subsidiaries
and the Guarantor (a) has made or filed all federal and state income and all
other tax returns, reports and declarations required by any jurisdiction to
which it is subject, (b) has paid all taxes and other governmental
assessments and charges shown or determined to be due on such returns,
reports and declarations, except those being contested in good faith and by
appropriate proceedings and (c) has set aside on its books provisions
reasonably adequate for the payment of all taxes for periods subsequent to
the periods to which such returns, reports or declarations apply. There are
no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of such Person know of no
basis for any such claim.
Section 6.11. NO EVENT OF DEFAULT. No Default or Event of Default has
occurred and is continuing.
Section 6.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. Neither
the Borrower nor any of its Subsidiaries nor the Guarantor is a "holding
company", or a "subsidiary company" of a
-34-
"holding company", or an "affiliate" of a "holding company", as such terms
are defined in the Public Utility Holding Company Act of 1935; nor is it an
"investment company", or an "affiliated company" or a "principal underwriter"
of an "investment company", as such terms are defined in the Investment
Company Act of 1940.
Section 6.13. ABSENCE OF UCC FINANCING STATEMENTS, ETC. Except with
respect to Permitted Liens, there is no financing statement, security
agreement, chattel mortgage, real estate mortgage or other document filed or
recorded with any filing records, registry, or other public office, that
purports to cover, affect or give notice of any present or possible future
lien on, or security interest or security title in, any property of the
Borrower or its Subsidiaries or the Guarantor or rights thereunder.
Section 6.14. INTENTIONALLY OMITTED.
Section 6.15. CERTAIN TRANSACTIONS. Except as set forth in the
Prospectus, none of the officers, trustees, directors, or employees of the
Borrower or any of its Subsidiaries or the Guarantor is a party to any
transaction with the Borrower or any of its Subsidiaries or the Guarantor
(other than for services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or
from, or otherwise requiring payments to or from any officer, trustee,
director or such employee or, to the knowledge of the Borrower, any
corporation, partnership, trust or other entity in which any officer,
trustee, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner.
Section 6.16. EMPLOYEE BENEFIT PLANS. The Borrower and each ERISA
Affiliate has fulfilled its obligations under the minimum funding standards
of ERISA and the Code with respect to each Employee Benefit Plan,
Multiemployer Plan or Guaranteed Pension Plan and is in compliance in all
material respects with the presently applicable provisions of ERISA and the
Code with respect to each Employee Benefit Plan, Multiemployer Plan or
Guaranteed Pension Plan. Neither the Borrower nor any ERISA Affiliate has
(a) sought a waiver of the minimum funding standard under Section 412 of the
Code in respect of any Employee Benefit Plan, Multiemployer Plan or
Guaranteed Pension Plan, (b) failed to make any contribution or payment to
any Employee Benefit Plan, Multiemployer Plan or Guaranteed Pension Plan, or
made any amendment to any Employee Benefit Plan, Multiemployer Plan or
Guaranteed Pension Plan, 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 Code,
or (c) incurred any liability under Title IV of ERISA other than a liability
to the PBGC for premiums under Section 4007 of ERISA. None of the
Unencumbered Operating Properties constitutes a "plan asset" of any Employee
Plan, Multiemployer Plan or Guaranteed Pension Plan.
Section 6.17. REGULATIONS U AND X. No portion of any Loan is to be
used for the purpose of purchasing or carrying any "margin security" or
"margin stock" as such terms are used in Regulations U and X of the Board of
Governors of the Federal Reserve System, 12 C.F.R. Parts
-35-
221 and 224.
Section 6.18. ENVIRONMENTAL COMPLIANCE. The Borrower has
conducted or caused to be conducted Phase I environmental site assessments
with respect to the past usage and condition of the Real Estate and the
operations conducted thereon, and is familiar with the present condition and
usage of the Real Estate and the operations conducted thereon and, based upon
such reports and knowledge, makes the following representations and
warranties.
(a) To the best of the Borrower's knowledge, none of the Borrower
or its Subsidiaries or any operator of the Real Estate, or any operations
thereon is in violation, or alleged violation, of any judgment, decree,
order, law, license, rule or regulation pertaining to environmental matters,
including without limitation, those arising under the Resource Conservation
and Recovery Act ("RCRA"), the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 as amended ("CERCLA"), the Superfund
Amendments and Reauthorization Act of 1986 ("XXXX"), the Federal Clean Water
Act, the Federal Clean Air Act, the Toxic Substances Control Act, or any
state or local statute, regulation, ordinance, order or decree relating to
the environment (hereinafter "Environmental Laws"), which violation involves
the Real Estate and would have a material adverse effect on the environment
or the business, assets or financial condition of the Borrower.
(b) Neither the Borrower nor any of its Subsidiaries has received
notice from any third party including, without limitation, any federal, state
or local governmental authority, (i) that it has been identified by the
United States Environmental Protection Agency ("EPA") as a potentially
responsible party under CERCLA with respect to a site listed on the National
Priorities List, 40 C.F.R. Part 000 Xxxxxxxx X (1986); (ii) that any
hazardous waste, as defined by 42 U.S.C. Section 9601(5), any hazardous
substances as defined by 42 U.S.C. Section 9601(14), any pollutant or
contaminant as defined by 42 U.S.C. Section 9601(33) or any toxic
substances, oil or hazardous materials or other chemicals or substances
regulated by any Environmental Laws ("Hazardous Substances") which it has
generated, transported or disposed of have been found at any site at which a
federal, state or local agency or other third party has conducted or has
ordered that the Borrower or any of its Subsidiaries conduct a remedial
investigation, removal or other response action pursuant to any Environmental
Law; or (iii) that it is or shall be a named party to any claim, action,
cause of action, complaint, or legal or administrative proceeding (in each
case, contingent or otherwise) arising out of any third party's incurrence of
costs, expenses, losses or damages of any kind whatsoever in connection with
the release of Hazardous Substances.
(c) To the best of the Borrower's knowledge, except as set forth
in SCHEDULE 6.18 or, in the case of Real Estate acquired after the date
hereof, except as may be disclosed in writing to the Agent upon the
acquisition of the same: (i) no portion of the Real Estate has been used for
the handling, processing, storage or disposal of Hazardous Substances except
in accordance with applicable Environmental Laws, and no underground tank or
other underground storage receptacle for Hazardous Substances is located on
any portion of the Real Estate; (ii) in the course of any activities
conducted by the Borrower, its Subsidiaries or the operators of its
properties, no Hazardous Substances have been generated or are being used on
the Real Estate
-36-
except in the ordinary course of business and in accordance with applicable
Environmental Laws; (iii) there has been no past or present releasing,
spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, disposing or dumping (a "Release") or threatened Release
of Hazardous Substances on, upon, into or from the Real Estate, or, to the
best of the Borrower's knowledge, on, upon, into or from the other properties
of the Borrower or its Subsidiaries, which Release would have a material
adverse effect on the value of any of the Real Estate or adjacent properties
or the environment; (iv) to the best of the Borrower's knowledge, there have
been no Releases on, upon, from or into any real property in the vicinity of
any of the Real Estate which, through soil or groundwater contamination, may
have come to be located on, and which would have a material adverse effect on
the value of, the Real Estate; and (v) any Hazardous Substances that have
been generated on any of the Real Estate have been transported off-site only
by carriers having an identification number issued by the EPA or approved by
a state or local environmental regulatory authority having jurisdiction
regarding the transportation of such substance and, to the best knowledge of
the Borrower without independent investigation, treated or disposed of only
by treatment or disposal facilities maintaining valid permits as required
under all applicable Environmental Laws, which transporters and facilities
have been and are, to the best of the Borrower's knowledge, operating in
compliance with such permits and applicable Environmental Laws.
(d) Neither the Borrower, its Subsidiaries nor any Real Estate is
subject to any applicable Environmental Law requiring the performance of
Hazardous Substances site assessments, or the removal or remediation of
Hazardous Substances, or the giving of notice to any governmental agency or
the recording or delivery to other Persons of an environmental disclosure
document or statement by virtue of the transactions set forth herein and
contemplated hereby, or as a condition to the effectiveness of any other
transactions contemplated hereby.
Section 6.19. SUBSIDIARIES. SCHEDULE 6.19 sets forth all of the
Subsidiaries of the Borrower. The form and jurisdiction of organization of
each of the Subsidiaries, and the Borrower's ownership interest therein, is
set forth in said SCHEDULE 6.19.
Section 6.20. INTENTIONALLY OMITTED.
Section 6.21. LOAN DOCUMENTS. All of the representations and
warranties of the Borrower made in this Agreement and the other Loan
Documents or any document or instrument delivered to the Agent or the Banks
pursuant to or in connection with any of such Loan Documents are true and
correct in all material respects, and neither the Borrower nor the Guarantor
has failed to disclose such information as is necessary to make such
representations and warranties not misleading.
Section 6.22. PROPERTY. All of the Borrower's and its Subsidiaries'
properties are in good repair and condition in all material respects, subject
to ordinary wear and tear, other than with respect to deferred maintenance
existing as of the date of acquisition of such property as permitted in this
Section 6.22. Without limiting the foregoing, the Borrower has completed an
appropriate investigation of the physical condition of each such property as
of the later of the date of the Borrower's or
-37-
such Subsidiaries' purchase thereof or the date upon which such property was
last security for Indebtedness of the Borrower or such Subsidiary, or their
predecessors, including without limitation an analysis of the structural
condition and existence of any material deferred maintenance, and such
property is in good condition, order and repair, and any material deferred
maintenance existing as of the date of acquisition of such property has been
corrected or satisfactory remediation actions are being taken. The Borrower
further has completed an appropriate investigation of the environmental
condition of each such property as of the later of the date of the Borrower's
or such Subsidiaries' purchase thereof or the date upon which such property
was last security for Indebtedness of the Borrower or such Subsidiary, or
their predecessors, including preparation of a "Phase I" report and, if
appropriate, a "Phase II" report, in each case prepared by a recognized
environmental engineer in accordance with customary standards which discloses
that such property is not in violation of the representations and covenants
set forth in this Agreement, unless satisfactory remediation actions are
being taken. There are no unpaid or outstanding real estate or other taxes
or assessments on or against any property of the Borrower or any of its
Subsidiaries which are payable by the Borrower or its Subsidiaries (except
only real estate or other taxes or assessments, that are not yet due and
payable). There are no pending eminent domain proceedings against any
property of the Borrower or its Subsidiaries or any part thereof, and, to the
knowledge of the Borrower, no such proceedings are presently threatened or
contemplated by any taking authority which may individually or in the
aggregate have any materially adverse effect on the business or financial
condition of the Borrower. None of the property of Borrower or its
Subsidiaries is now damaged or injured as a result of any fire, explosion,
accident, flood or other casualty in any manner which individually or in the
aggregate would have any materially adverse effect on the business or
financial condition of the Borrower.
Section 6.23. BROKERS. Neither the Borrower nor any of its
Subsidiaries has engaged or otherwise dealt with any broker, finder or
similar entity in connection with this Agreement or the Loans contemplated
hereunder.
Section 6.24. OTHER DEBT. Neither the Borrower nor any of its
Subsidiaries nor the Guarantor is in default in the payment of any other
Indebtedness or under any agreement, mortgage, deed of trust, security
agreement, financing agreement, indenture or lease to which any of them is a
party, excluding trade payables less than sixty (60) days old. The Borrower
is not a party to or bound by any agreement, instrument or indenture that may
require the subordination in right or time of payment of any of the
Obligations to any other indebtedness or obligation of the Borrower.
Section 6.25. SOLVENCY. As of the Closing Date and after giving
effect to the transactions contemplated by this Agreement and the other Loan
Documents, including all of the Loans made hereunder, the Borrower and the
Guarantor are not insolvent on a balance sheet basis such that the sum of
each of their respective assets exceeds the sum of each of their respective
liabilities, each is able to pay its debts as they become due, and each has
sufficient capital to carry on its business.
-38-
Section 6.26. GUARANTOR. Each Guarantor is a wholly-owned Subsidiary
of the Borrower.
Section 7. AFFIRMATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan or Note or
Letter of Credit is outstanding or any Bank has any obligation to make any
Loans or the Agent has any obligation to issue any Letters of Credit:
Section 7.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually
pay or cause to be paid the principal and interest on the Loans and all
interest and fees provided for in this Agreement, all in accordance with the
terms of this Agreement and the Notes as well as all other sums owing
pursuant to the Loan Documents.
Section 7.2. MAINTENANCE OF OFFICE. The Borrower will maintain its
chief executive office at 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxxxx,
Xxxxxxxxxx 00000, or at such other place in the United States of America as
the Borrower shall designate upon prior written notice to the Agent and the
Banks, where notices, presentations and demands to or upon the Borrower in
respect of the Loan Documents may be given or made.
Section 7.3. RECORDS AND ACCOUNTS. The Borrower will (a) keep, and
cause each of its Subsidiaries to keep, true and accurate records and books
of account in which full, true and correct entries will be made in accordance
with generally accepted accounting principles and (b) maintain adequate
accounts and reserves for all taxes (including income taxes), depreciation
and amortization of its properties and the properties of its Subsidiaries,
contingencies and other reserves.
Section 7.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The
Borrower will deliver to each of the Banks:
(a) as soon as practicable, but in any event not later than 90
days after the end of each fiscal year of the Borrower, the audited
consolidated balance sheet of the Borrower and its Subsidiaries at the end of
such year, and the related audited consolidated statements of income, changes
in shareholder's equity and cash flows for such year, each setting forth in
comparative form the figures for the previous fiscal year and all such
statements to be in reasonable detail, prepared in accordance with generally
accepted accounting principles, and accompanied by an auditor's report
prepared without qualification by Xxxxxx Xxxxxxxx LLP or by another "Big Six"
accounting firm, the Form 10-K filed with the SEC (unless the SEC has
approved an extension, in which event the Borrower will deliver to the Agent
and each of the Banks a copy of the Form 10-K simultaneously with delivery to
the SEC), and any other information the Banks may need to complete a
financial analysis of the Borrower and its Subsidiaries. At any time that the
Agent has reasonable grounds to request the same (including, without
limitation, at any time that the Compliance Certificate indicates that the
Borrower is at or near minimum compliance with the financial covenants
contained in this Agreement), the Agent may require that such report be
accompanied by a written statement from such accountants to the
-39-
effect that they have read a copy of this Agreement, and that, in making the
examination necessary for said certification, they have obtained no knowledge
of any Default or Event of Default, or, if such accountants shall have
obtained knowledge of any then existing Default or Event of Default, they
shall disclose in such statement any such Default or Event of Default;
(b) as soon as practicable, but in any event not later than 45
days after the end of each fiscal quarter of the Borrower (including the
fourth fiscal quarter in each year), copies of the unaudited consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such
quarter, and the related unaudited consolidated statements of income, changes
in shareholder's equity and cash flows for the portion of the Borrower's
fiscal year then elapsed, all in reasonable detail and prepared in accordance
with generally accepted accounting principles (which may be provided by
inclusion in the Form 10-Q of the Borrower for such period provided pursuant
to subsection (c) below), together with a certification by an Authorized
Officer of the Borrower that the information contained in such financial
statements fairly presents the financial position of the Borrower and its
Subsidiaries on the date thereof (subject to year-end adjustments);
(c) as soon as practicable, but in any event not later than 45
days after the end of each fiscal quarter of the Borrower (excluding the
fourth fiscal quarter in each year), copies of Form 10-Q filed with the SEC
(unless the SEC has approved an extension in which event the Borrower will
deliver such copies of the Form 10-Q to the Agent and each of the Banks
simultaneously with delivery to the SEC);
(d) as soon as practicable, but in any event not later than 45
days after the end of each fiscal quarter of the Borrower (including the
fourth fiscal quarter in each year), copies of a consolidated statement of
the Funds from Operations for such fiscal quarter for the Borrower and its
Subsidiaries and the Net Operating Income and Operating Cash Flow for the
Real Estate and year-to-date in form and substance satisfactory to Agent,
prepared on a basis consistent with the statement furnished pursuant to
Section 6.4(c) together with a certification by an Authorized Officer of the
Borrower that the information contained in such statement fairly presents the
Funds from Operations of the Borrower and its Subsidiaries and the Net
Operating Income and Operating Cash Flow for the Real Estate for such period;
(e) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, and within thirty (30) days of
the filing with the SEC of a Form 8-K or any other document amending any
other filing previously made by the Borrower which could reasonably be
expected to have a materially adverse effect on the Borrower, a statement (a
"Compliance Certificate") certified by an Authorized Officer of the Borrower
and the Guarantor in the form of EXHIBIT D hereto setting forth in reasonable
detail computations evidencing compliance with the covenants contained in
Section 9, and (if applicable) reconciliations to reflect changes in
generally accepted accounting principles since the Balance Sheet Date;
(f) concurrently with the delivery of the financial statements
described in
-40-
subsections (b) and (c) above, a certificate signed by an Authorized Officer
of the Borrower to the effect that, having read this Agreement, and based
upon an examination which they deem sufficient to enable them to make an
informed statement, there does not exist any Default or Event of Default, or
if such Default or Event of Default has occurred, specifying the facts with
respect thereto;
(g) contemporaneously with the filing or mailing thereof, copies
of all material of a financial nature filed with the SEC or sent to the
stockholders of the Borrower;
(h) upon request of the Agent, but in any event not later than 30
days after receipt of notice of such request from the Agent, updated Rent
Rolls with respect to the Real Estate, a summary of each Rent Roll in form
reasonably satisfactory to the Agent, and a leasing activity report with
respect to the Real Estate setting forth the Borrower's efforts to market and
lease the then unleased space in the Real Estate and the results of such
efforts;
(i) simultaneously within the delivery of the financial statement
referred to in subsection (a) above, a statement (i) listing the Real Estate
owned by the Borrower and its Subsidiaries (or in which Borrower or its
Subsidiaries owns an interest) and stating the owner thereof, the location
thereof, the date acquired and the acquisition cost, (ii) listing the
Indebtedness of the Borrower and its Subsidiaries (excluding Indebtedness of
the type described in Section 8.1(b)-(e)), which statement shall include,
without limitation, a statement of the original principal amount of such
Indebtedness and the current amount outstanding, the holder thereof, the
maturity date and any extension options, the interest rate, the collateral
provided for such Indebtedness and whether such Indebtedness is recourse or
Non-recourse, and (iii) listing the properties of the Borrower and its
Subsidiaries which are under "development" (as used in Section 8.9) and
providing a brief summary of the status of such development;
(j) promptly after they are filed with the Internal Revenue
Service, copies of all annual federal income tax return and amendments
thereto of the Borrower; and
(k) from time to time such other financial data and information in
the possession of the Borrower or the Guarantor (including without limitation
separate financial statements for the Guarantor, auditors' management
letters, evidence of payment of taxes, property inspection and environmental
reports and information as to zoning and other legal and regulatory changes
affecting the Borrower or the Guarantor) as the Agent may reasonably request.
Section 7.5. NOTICES.
(a) DEFAULTS. The Borrower will promptly notify the Agent in
writing of the occurrence of any Default or Event of Default. If any Person
shall give any notice or take any other action in respect of a claimed
default (whether or not constituting an Event of Default) under this
Agreement or under any note, evidence of indebtedness, indenture or other
obligation
-41-
to which or with respect to which the Borrower or any of its Subsidiaries or
the Guarantor is a party or obligor, whether as principal or surety, and such
default would permit the holder of such note or obligation or other evidence
of indebtedness to accelerate the maturity thereof, which acceleration would
have a material adverse effect on the Borrower or the Guarantor or the
existence of which claimed default might become an Event of Default under
Section 12.1(g), the Borrower shall forthwith give written notice thereof to
the Agent and each of the Banks, describing the notice or action and the
nature of the claimed default.
(b) ENVIRONMENTAL EVENTS. The Borrower will promptly give notice
to the Agent (i) upon the Borrower obtaining knowledge of any potential or
known Release, or threat of Release, of any Hazardous Substances at or from
any Real Estate of the Borrower or its Subsidiaries; (ii) of any violation of
any Environmental Law that the Borrower or any of its Subsidiaries reports in
writing or is reportable by such Person in writing (or for which any written
report supplemental to any oral report is made) to any federal, state or
local environmental agency and (iii) upon becoming aware thereof, of any
inquiry, proceeding, investigation, or other action, including a notice from
any agency of potential environmental liability, of any federal, state or
local environmental agency or board, that in either case involves any Real
Estate of the Borrower or its Subsidiaries or has the potential to materially
affect the assets, liabilities, financial conditions or operations of the
Borrower or any Subsidiary.
(c) NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will give
notice to the Agent in writing within 15 days of becoming aware of any
litigation or proceedings threatened in writing or any pending litigation and
proceedings affecting the Borrower, any of its Subsidiaries or the Guarantor,
or to which such Person is or is to become a party involving an uninsured
claim against such Person that could reasonably be expected to have a
materially adverse effect on such Person and stating the nature and status of
such litigation or proceedings. The Borrower will give notice to the Agent,
in writing, in form and detail satisfactory to the Agent and each of the
Banks, within ten days of any judgment not covered by insurance, whether
final or otherwise, against the Borrower, any of its Subsidiaries or the
Guarantor in an amount in excess of $250,000.
(d) NOTICE OF PROPOSED SALES, ENCUMBRANCES, REFINANCE OR TRANSFER.
The Borrower will give notice to the Agent of any proposed or completed sale,
encumbrance (excluding encumbrances described in Section 8.2(iv)), refinance
or transfer of any Real Estate or other Investment described in
Section 8.3(j) of the Borrower of its Subsidiaries within any fiscal quarter
of the Borrower, such notice to be submitted together with the Compliance
Certificate provided or required to be provided to the Banks under
Section 7.4 with respect to such fiscal quarter. The Compliance Certificate
shall with respect to any proposed or completed sale, encumbrance, refinance
or transfer be adjusted in the best good-faith estimate of the Borrower to
give effect to such sale, encumbrance, refinance or transfer and demonstrate
that no Default or Event of Default with respect to the covenants referred to
therein shall exist after giving effect to such sale, encumbrance, refinance
or transfer. Notwithstanding the foregoing, in the event of any sale,
encumbrance, refinance or transfer of any Real Estate or other Investment
described in Section 8.3(j) of
-42-
the Borrower or its Subsidiaries involving an amount in excess of twenty
percent (20%) of the value of the Consolidated Total Assets of the Borrower,
the Borrower shall promptly give notice to the Agent of such transaction,
which notice shall be accompanied by a certification of Authorized Officer of
the Borrower that no Default or Event of Default shall exist after giving
affect to such event.
(e) NOTIFICATION OF BANKS. Promptly after receiving any notice
under this Section 7.5, the Agent will forward a copy thereof to each of the
Banks, together with copies of any certificates or other written information
that accompanied such notice.
Section 7.6. EXISTENCE; MAINTENANCE OF PROPERTIES.
(a) The Borrower will do or cause to be done all things necessary
to preserve and keep in full force and effect its existence as a Maryland
corporation. The Borrower will cause each of its Subsidiaries to do or cause
to be done all things necessary to preserve and keep in full force and effect
its legal existence. The Borrower will do or cause to be done all things
necessary to preserve and keep in full force all of its rights and franchises
and those of its Subsidiaries. The Borrower will, and will cause each of its
Subsidiaries to, continue to engage primarily in the businesses now conducted
by it and in related businesses.
(b) The Borrower (i) will cause all of its properties and those of
its Subsidiaries used or useful in the conduct of its business or the
business of its Subsidiaries to be maintained and kept in good condition,
repair and working order (ordinary wear and tear excepted) and supplied with
all necessary equipment, and (ii) will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof in all
cases in which the failure so to do would have a material adverse effect on
the condition of its properties or on the financial condition, assets or
operations of the Borrower and its Subsidiaries.
Section 7.7. INSURANCE. The Borrower will, at its expense, procure
and maintain or cause to be procured and maintained insurance covering the
Borrower, its Subsidiaries and their respective properties in such amounts
and against such risks and casualties as are customary for properties of
similar character and location, due regard being given to the type of
improvements thereon, their construction, location, use and occupancy.
Section 7.8. TAXES. The Borrower and each Subsidiary will duly pay
and discharge, or cause to be paid and discharged, before the same shall
become overdue, all taxes, assessments and other governmental charges imposed
upon it and upon the Real Estate, sales and activities, or any part thereof,
or upon the income or profits therefrom, as well as all claims for labor,
materials, or supplies that if unpaid might by law become a lien or charge
upon any of its property; PROVIDED that any such tax, assessment, charge,
levy or claim need not be paid if the validity or amount thereof shall
currently be contested in good faith by appropriate proceedings and if the
Borrower or such Subsidiary shall have set aside on its books adequate
reserves with respect thereto; and PROVIDED, FURTHER, that forthwith upon the
commencement of proceedings to foreclose any lien
-43-
that may have attached as security therefor, the Borrower and each Subsidiary
of the Borrower either (i) will provide a bond issued by a surety reasonably
acceptable to the Agent and sufficient to stay all such proceedings or (ii)
if no such bond is provided, will pay each such tax, assessment, charge, levy
or claim. The Borrower shall certify annually to the Agent that the Borrower
is in compliance with this Section 7.8 with respect to the Unencumbered
Operating Properties.
Section 7.9. INSPECTION OF PROPERTIES AND BOOKS. The Borrower shall
permit the Banks, through the Agent or any representative designated by the
Agent, at the Borrower's expense to visit and inspect any of the properties
of the Borrower or any of its Subsidiaries, to examine the books of account
of the Borrower and its Subsidiaries (and to make copies thereof and extracts
therefrom) and to discuss the affairs, finances and accounts of the Borrower
and its Subsidiaries with, and to be advised as to the same by, its officers,
all at such reasonable times and intervals as the Agent or any Bank may
reasonably request. The Banks shall use good faith efforts to coordinate
such visits and inspections so as to minimize the interference with and
disruption to the Borrower's normal business operations.
Section 7.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS.
The Borrower will comply with, and will cause each of its Subsidiaries to
comply in all respects with (i) all applicable laws and regulations now or
hereafter in effect wherever its business is conducted, including all
Environmental Laws, (ii) the provisions of its corporate charter, partnership
agreement or declaration of trust, as the case may be, and other charter
documents and bylaws, (iii) all agreements and instruments to which it is a
party or by which it or any of its properties may be bound, (iv) all
applicable decrees, orders, and judgments, and (v) all licenses and permits
required by applicable laws and regulations for the conduct of its business
or the ownership, use or operation of its properties (with respect to
subsections (i), (iii) and (v) above, such compliance shall be in all
material respects, subject to the provisions of Section 12.1(f)). If at any
time while any Loan or Note or Letter of Credit is outstanding or the Banks
have any obligation to make Loans hereunder or the Agent has any obligation
to issue any Letters of Credit hereunder, any authorization, consent,
approval, permit or license from any officer, agency or instrumentality of
any government shall become necessary or required in order that the Borrower
may fulfill any of its obligations hereunder, the Borrower will immediately
take or cause to be taken all steps necessary to obtain such authorization,
consent, approval, permit or license and furnish the Agent and the Banks with
evidence thereof.
Section 7.11. USE OF PROCEEDS. Subject to the limitations set forth
herein, the Borrower will use the proceeds of the Loans or issuances of
Letters of Credit solely to provide short-term financing (a) for the
acquisition and development of fee interests in primarily non-specialized
industrial real estate of institutional quality, including reasonable
transaction costs related thereto; (b) for working capital purposes; and (c)
for such other purposes as the Majority Banks in their discretion from time
to time may agree to in writing. Notwithstanding anything herein to the
contrary, the amount of Loans and Letters of Credit Outstanding at any time
which has been advanced for the purpose described in Section 7.11(b) shall
not exceed $15,000,000.00, and may be
-44-
used by Borrower only for the following purposes: (i) for the payment of
expenditures for Capital Improvement Projects, tenant finish and leasing
commissions; (ii) up to $2,500,000.00 per quarter for payment of
Distributions up to a maximum amount outstanding at one time of
$5,000,000.00, provided that the Borrower shall not draw on the Loans for
payment of Distributions in any two (2) consecutive quarters; (iii) up to a
maximum amount outstanding at any time of $10,000,000.00 to repurchase Voting
Interests of the Borrower (other than Voting Interests owned by Xxxx Realty
Acquisitions, L.P., USAA Real Estate Company or subsequent private placement
investors), which amount must be drawn before the first anniversary of the
Closing Date; and (iv) with respect to amounts Outstanding under Letters of
Credit only, for other working capital purposes. Upon repayment of all or a
portion of the Loans, the Borrower will be allowed to reborrow for working
capital purposes subject to the limitations set forth above.
Section 7.12. FURTHER ASSURANCES. The Borrower will cooperate with,
and will cause each of its Subsidiaries to cooperate with the Agent and the
Banks and execute such further instruments and documents as the Banks or the
Agent shall reasonably request to carry out to their satisfaction the
transactions contemplated by this Agreement and the other Loan Documents.
Section 7.13. REIT STATUS. Subject to the terms of Section 8.7, the
Borrower shall at all times comply with all requirements of applicable laws
and regulations necessary to maintain REIT Status and shall operate its
business as described in the Prospectus in all material aspects and in
compliance with the terms and conditions of this Agreement and the other Loan
Documents.
Section 7.14. RESTRICTIONS ON ACQUISITIONS. The Borrower shall, and
shall cause each of its Subsidiaries to, exercise due diligence in connection
with the acquisition of Real Estate or other assets and shall not knowingly
acquire any Real Estate or other assets which has any material title, survey,
environmental, structural or other defects that would give rise to a
materially adverse effect as to the value, use of or ability to sell or
refinance such property or the business or affairs of the Borrower or its
Subsidiaries.
Section 7.15. UNENCUMBERED OPERATING PROPERTIES.
(a) The Borrower and the Guarantor shall at all times own
Unencumbered Operating Properties which satisfy all of the following
conditions:
(i) at least seventy percent (70%) of the Asset Value of
the Unencumbered Operating Properties constitutes industrial properties,
which percentage shall be increased to seventy-five percent (75%) on the
first anniversary of the Closing Date;
(ii) as of the end of each fiscal quarter, at least
eighty-five percent (85%) of the total Gross Rentable Area of the
Unencumbered Operating Properties is subject to arms-length Leases which
are in full force and effect and pursuant to which the
-45-
tenants are paying rent, and at least seventy-seven percent (77%) of the
total Gross Rentable Area in the Unencumbered Operating Properties is
physically occupied by tenants under arms-length Leases which are in
full force and effect;
(iii) no more than twenty percent (20%) of the Asset Value
of the Unencumbered Operating Properties is located in any one city or
metropolitan area, provided that no more than thirty percent (30%) may be
located in Memphis, Tennessee, or any surrounding suburbs, including
Olive Branch, Mississippi; and
(iv) no one tenant shall comprise more than seven percent
(7%) [ten percent (10%) if the tenant has a Standard & Poor's Rating of
BBB- or better] of the Gross Cash Receipts generated by the Unencumbered
Operating Properties.
(b) The Borrower shall provide to the Agent as of the Closing Date
and concurrently with the delivery of the financial statements described in
Section 7.4(a) (i) a list of the Unencumbered Operating Properties, (ii) the
certification of an Authorized Officer of the Borrower or the Guarantor, as
applicable, of the Asset Values and that such Unencumbered Operating
Properties are in compliance with Section 7.15(a), and (iii) operating
statements setting forth the Net Operating Income and Operating Cash Flow for
each of the Unencumbered Operating Properties for the previous three (3)
fiscal quarters certified as true and correct by an Authorized Officer of the
Borrower or the Guarantor, as applicable. In the event that all or any
material portion of a property within the Unencumbered Operating Properties
shall be damaged or taken by condemnation, then such property shall no longer
be a part of the Unencumbered Operating Properties unless and until any
damage to such Real Estate is repaired or restored, such Real Estate becomes
fully operational and the Agent shall receive evidence satisfactory to the
Agent of the value, Net Operating Income and Operating Cash Flow of such Real
Estate following such repair or restoration.
(c) Nothing herein shall be construed as an obligation of the
Borrower to grant any mortgage, pledge or security interest to the Agent or
the Banks in any of the Unencumbered Operating Properties, nor as an
obligation of the Borrower to reserve any particular Unencumbered Operating
Property as potential collateral for the Agent and the Banks; provided,
however, that this Section 7.15(c) shall not diminish the Borrower's
obligation to comply with the terms of this Section 7.15 or Section 7.16.
(d) The Borrower and the Guarantor will use commercially
reasonable efforts to ascertain the equity ownership of each of its potential
tenants prior to executing a Lease (excluding those tenants from whom the
Borrower or the Guarantor derive a sufficiently small amount of revenue such
that, in the reasonable opinion of the management of the Borrower or the
Guarantor, rent from such tenant would not adversely affect the Borrower's
ability to qualify as a REIT), in order to identify any tenants in which
Ameritech owns, directly or indirectly, a ten percent (10%) or greater equity
interest, and neither the Borrower nor any Guarantor shall enter into Leases
with any tenants so identified.
-46-
Section 7.16. LIMITING AGREEMENTS.
(a) Neither Borrower nor any of its Subsidiaries nor the Guarantor
shall enter into any agreement, instrument or transaction which has or may
have the effect of prohibiting or limiting the Borrower's or the Guarantor's
ability to pledge to Agent Real Estate which is owned by the Borrower or the
Guarantor one hundred percent (100%) in fee simple. Borrower and Guarantor
shall take, and Borrower shall cause its Subsidiaries to take, such actions
as are necessary to preserve the right and ability of Borrower and Guarantor
to pledge those Real Estate assets as security for the Loans without any such
pledge after the date hereof causing or permitting the acceleration (after
the giving of notice or the passage of time, or otherwise) of any other
Indebtedness of Borrower or any of its Subsidiaries or the Guarantor. This
Section 7.16 shall not be construed as limiting Borrower's or Guarantor's
rights under Section 8.2 as it relates to a particular type of lien which
the Borrower or the Guarantor may incur.
(b) Borrower shall, upon demand by the Agent in the exercise of
the Agent's reasonable discretion, provide to the Agent such evidence as the
Agent may reasonably require to evidence Borrower's compliance with this
Section 7.16, which evidence shall include, without limitation, copies of any
agreements or instruments which would in any way restrict or limit the
Borrower's or the Guarantor's ability to pledge assets as security for
Indebtedness, or which provide for the occurrence of a default (after the
giving of notice or the passage of time, or otherwise) if assets are pledged
in the future as security for Indebtedness of the Borrower or any of its
Subsidiaries or the Guarantor.
Section 7.17. ENVIRONMENTAL AND ENGINEERING INSPECTIONS. The Borrower
shall, with respect to each property at any time included as part of the
Unencumbered Operating Properties, provide to the Agent evidence reasonably
satisfactory to the Agent prior to the inclusion of such property within the
Unencumbered Operating Properties that (a) the Borrower has completed an
appropriate investigation of the physical condition of such property,
including without limitation an analysis of the structural condition and
existence of any material deferred maintenance, and that such property is in
good condition, order and repair and that any material deferred maintenance
has been corrected or satisfactory remediation actions are being taken, as
determined by the Agent in its reasonable judgment, and (b) that the Borrower
has completed an appropriate investigation of the environmental condition of
each proposed property, including preparation of a "Phase I" report and, if
appropriate, a "Phase II" report, in each case prepared by a recognized
environmental engineer in accordance with customary standards which discloses
that such property is not in violation of the representations and covenants
set forth in this Agreement, unless satisfactory remediation actions are
being taken, as determined by the Agent in its reasonable judgment.
Section 8. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan or Note or
Letter of Credit is outstanding or any of the Banks has any obligation to
make any Loans or the Agent has any obligation to issue any Letters of Credit:
-47-
Section 8.1. RESTRICTIONS ON INDEBTEDNESS. The Borrower will not, and
will not permit any of its Subsidiaries to, create, incur, assume, guarantee
or be or remain liable, contingently or otherwise, with respect to any
Indebtedness other than:
(a) Indebtedness to the Banks arising under any of the Loan
Documents;
(b) current liabilities of the Borrower or its Subsidiaries incurred
in the ordinary course of business, including letters of credit not to exceed
$1,500,000.00 in the aggregate, but not incurred through (i) the borrowing of
money, or (ii) the obtaining of credit except for credit on an open account
basis customarily extended and in fact extended in connection with normal
purchases of goods and services;
(c) Indebtedness in respect of taxes, assessments, governmental
charges or levies and claims for labor, materials and supplies to the extent
that payment therefor shall not at the time be required to be made in
accordance with the provisions of Section 7.8;
(d) Indebtedness in respect of judgments or awards that have been
in force for less than the applicable period for taking an appeal so long as
execution is not levied thereunder or in respect of which the Borrower shall
at the time in good faith be prosecuting an appeal or proceedings for review
and in respect of which a stay of execution shall have been obtained pending
such appeal or review;
(e) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the ordinary
course of business;
(f) subject to the provisions of Section 9, Non-recourse
Indebtedness of the Borrower or any Subsidiary of the Borrower related to the
acquisition of Real Estate in an aggregate outstanding principal amount not
exceeding $20,000,000.00;
(g) Indebtedness in respect of reverse repurchase agreements
having a term of not more than 180 days with respect to Investments described
in Section 8.3(d) or (e);
(h) The Prudential Loan, provided the Prudential Loan shall remain
Non-recourse as to the Borrower; and
(i) Indebtedness not to exceed $2,000,000.00 in the aggregate in
respect of note purchase agreement(s) relating to loans made to executive
officers of the Borrower for the purchase of shares of beneficial interest in
the Borrower.
Section 8.2. RESTRICTIONS ON LIENS, ETC. The Borrower will not, and
will not permit any of its Subsidiaries to, (a) create or incur or suffer to
be created or incurred or to exist any lien, encumbrance, mortgage, pledge,
charge, restriction or other security interest of any kind upon any of its
property or assets of any character whether now owned or hereafter acquired,
or upon the income or profits therefrom; (b) transfer any of its property or
assets or the income or profits therefrom for the purpose of subjecting the
same to the payment of Indebtedness or performance of any other obligation in
priority to payment of its general creditors; (c) acquire, or agree or have
an option to acquire, any property or assets upon conditional sale or other
title retention or purchase money security agreement, device or arrangement;
(d) suffer to exist for a period of more than 30 days after the same shall
have been incurred any Indebtedness or claim or demand
-48-
against it that if unpaid might by law or upon bankruptcy or insolvency, or
otherwise, be given any priority whatsoever over its general creditors; or
(e) sell, assign, pledge or otherwise transfer any accounts, contract rights,
general intangibles, chattel paper or instruments, with or without recourse
(collectively "Liens"); PROVIDED that, the Borrower and any Subsidiary of the
Borrower may create or incur or suffer to be created or incurred or to exist:
(i) liens in favor of the Borrower on all or
part of the assets of Subsidiaries of the Borrower securing
Indebtedness owing by Subsidiaries of the Borrower to the
Borrower;
(ii) liens on properties to secure taxes,
assessments and other governmental charges or claims for labor,
material or supplies in respect of obligations not overdue;
(iii) liens on properties in respect of
judgments, awards or indebtedness, the Indebtedness with respect
to which is permitted by Section 8.1(d) or Section 8.1(f);
(iv) encumbrances on properties consisting
of leases entered into in the ordinary conduct of the business
of the Borrower and its Subsidiaries, easements, rights of way,
zoning restrictions, restrictions on the use of real property
and defects and irregularities in the title thereto, landlord's
or lessor's liens under leases to which the Borrower or a
Subsidiary of the Borrower is a party, and other minor liens or
encumbrances none of which interferes materially with the use of
the property effected in the ordinary conduct of the business of
the Borrower and its Subsidiaries, which defects do not
individually or in the aggregate have a materially adverse
effect on the business of the Borrower individually or of the
Borrower and its Subsidiaries on a consolidated basis;
(v) liens on Real Estate and Short-term
Investments securing Non-recourse Indebtedness permitted by
Section 8.1(f);
(vi) liens in favor of the Agent and the
Banks; and
(vii) liens securing the Prudential Loan.
Section 8.3. RESTRICTIONS ON INVESTMENTS. The Borrower will not, and
will not permit any of its Subsidiaries to, make or permit to exist or to
remain outstanding any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America that mature within five (5) years from the date of purchase
by the Borrower or its Subsidiary;
(b) marketable direct obligations of any of the following: Federal
Home Loan Mortgage Corporation, Student Loan Marketing Association, Federal
Home Loan Banks, Federal National Mortgage Association, Government National
Mortgage Association, Bank for
-49-
Cooperatives, Federal Intermediate Credit Banks, Federal Financing Banks,
Export-Import Bank of the United States, Federal Land Banks, or any other
agency or instrumentality of the United States of America;
(c) demand deposits, certificates of deposit, bankers acceptances
and time deposits of United States banks having total assets in excess of
$100,000,000; PROVIDED, HOWEVER, that the aggregate amount at any time so
invested with any single bank having total assets of less than $1,000,000,000
will not exceed $200,000;
(d) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States of
America or any State which at the time of purchase are rated by Xxxxx'x
Investors Service, Inc. or by Standard & Poor's Corporation at not less than
"P 1" if then rated by Xxxxx'x Investors Service, Inc., and not less than
"A 1", if then rated by Standard & Poor's Corporation;
(e) mortgage-backed securities guaranteed by the Government
National Mortgage Association, the Federal National Mortgage Association or
the Federal Home Loan Mortgage Corporation and other mortgage-backed bonds
which at the time of purchase are rated by Xxxxx'x Investors Service, Inc. or
by Standard & Poor's Corporation at not less than "Aa" if then rated by
Xxxxx'x Investors Service, Inc. and not less than "AA" if then rated by
Standard & Poor's Corporation;
(f) repurchase agreements having a term not greater than 90 days
and fully secured by securities described in the foregoing subsection (a),
(b) or (e) with banks described in the foregoing subsection (c) or with
financial institutions or other corporations having total assets in excess of
$500,000,000;
(g) shares of so-called "money market funds" registered with the
SEC under the Investment Company Act of 1940 which maintain a level per-share
value, invest principally in investments described in the foregoing
subsections (a) through (f) and have total assets in excess of $50,000,000;
(h) subject to the provisions of Section 9.6, Investments in fee
interests in Real Estate constituting institutional grade, non-specialized
industrial property, including xxxxxxx money deposits relating thereto and
transaction costs;
(i) Investments in Subsidiaries in which the Borrower holds 100%
of the Voting Interests;
(j) subject to the provisions of Section 9.6, interests in
partnerships, joint ventures, corporations or other entities which own
institutional grade real property used principally for industrial purposes;
-50-
(k) Investments in shares of beneficial interest in the Borrower,
provided that the Borrower shall give notice to the Agent concurrently with
the financial statements provided in '7.4(b) of any such Investments that
have occurred during the preceding fiscal quarter of the Borrower;
(l) Investments in purchase money notes payable to the order of the Borrower
or any of its Subsidiaries which are received in connection with the sale by
the Borrower or any of its Subsidiaries of Real Estate, provided that
Borrower shall not, for any fiscal quarter, permit the aggregate outstanding
principal balance of such purchase money notes to exceed ten percent (10%) of
the value of the Consolidated Total Assets of the Borrower, adjusted pursuant
to -Section-9.7; and
(m) Investments in notes payable to the Borrower made by executive
officers of the Borrower for the purchase of shares of beneficial interest in
the Borrower in an aggregate outstanding principal amount not exceeding
$2,000,000.00.
-Section-8.4. MERGER, CONSOLIDATION. The Borrower will not, and will
not permit any of its Subsidiaries to, become a party to any merger or
consolidation without the prior written consent of the Majority Banks except
(i) the merger or consolidation of one or more of the Subsidiaries of the
Borrower with and into the Borrower, (ii) the merger or consolidation of two
or more Subsidiaries of the Borrower, and (iii) the merger or consolidation
of one or more unaffiliated corporations or other entities with and into the
Borrower where (a) the Borrower is the surviving entity, (b) immediately
after the merger or consolidation, the original shareholders of the Borrower
at the time of such consolidation or merger own at least fifty-one percent
(51%) of the Voting Interests in the Borrower, (c) the purpose of the
consolidation or merger is the acquisition of Real Estate as permitted under
this Agreement, and (d) immediately prior to such merger the Borrower shall
have provided to the Banks a written statement that no Default or Event of
Default exists and a Compliance Certificate demonstrating that the Borrower
will be in compliance with the covenants referred to therein after giving
effect to said merger.
-Section-8.5. SALE AND LEASEBACK. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into any arrangement, directly or
indirectly, whereby the Borrower or any Subsidiary of the Borrower shall sell
or transfer any Real Estate owned by it in order that then or thereafter the
Borrower or any Subsidiary shall lease back such Real Estate.
-Section-8.6. COMPLIANCE WITH ENVIRONMENTAL LAWS. The Borrower will
not, and will not permit any of its Subsidiaries, to do any of the following:
(a) use any of the Real Estate or any portion thereof as a facility for the
handling, processing, storage or disposal of Hazardous Substances, except for
small quantities of Hazardous Substances used in the ordinary course of
business and in compliance with all applicable Environmental Laws, (b) cause
or permit to be located on any of the Real Estate any underground tank or
other underground storage receptacle for Hazardous Substances except in full
compliance with Environmental Laws, (c) generate any Hazardous Substances on
any of the Real Estate except in full compliance with Environmental Laws, (d)
conduct any activity at any Real Estate or use any Real Estate in any manner
so as to cause a
-51-
Release of Hazardous Substances on, upon or into the Real Estate or any
surrounding properties or any threatened Release of Hazardous Substances
which might give rise to liability under CERCLA or any other Environmental
Law, or (e) directly or indirectly transport or arrange for the transport of
any Hazardous Substances (except in compliance with all Environmental Laws).
The Borrower shall:
(i) in the event of any change in Environmental Laws governing the
assessment, release or removal of Hazardous Substances, which change would
lead a prudent owner of real property to require additional testing to avail
itself of any statutory insurance or limited liability, take all action
(including, without limitation, the conducting of engineering tests at the
sole expense of the Borrower) to determine whether Hazardous Substances were
ever Released or disposed of on the Real Estate; and
(ii) if any Release or disposal of Hazardous Substances shall
occur or shall have occurred on the Real Estate (including without limitation
any such Release or disposal occurring prior to the acquisition of such Real
Estate by the Borrower), cause the prompt containment and removal of such
Hazardous Substances and remediation of the Real Estate in full compliance
with all applicable laws and regulations and to the satisfaction of the
Majority Banks; PROVIDED, that the Borrower shall be deemed to be in
compliance with Environmental Laws for the purpose of this clause (ii) so
long as it or a responsible third party with sufficient financial resources
is taking reasonable action to remediate or manage any event of noncompliance
to the satisfaction of the Majority Banks and no action shall have been
commenced by any enforcement agency. The Majority Banks may engage their own
Environmental Engineer to review the environmental assessments and the
Borrower's compliance with the covenants contained herein, the cost of which
shall be borne by the Borrower.
At any time after an Event of Default shall have occurred hereunder, or,
whether or not an Event of Default shall have occurred, at any time that the
Agent or the Majority Banks shall have reasonable grounds to believe that a
Release or threatened Release of Hazardous Substances may have occurred,
relating to any Real Estate, or that any of the Real Estate is not in
compliance with the Environmental Laws, and, unless such Real Estate is an
Unencumbered Operating Property, that such Release, threatened Release or
noncompliance may be reasonably expected to have a material adverse effect on
the Borrower as determined by the Agent in the exercise of its sole
discretion, the Agent may at its election (and will at the request of the
Majority Banks excluding the Agent) obtain such environmental assessments of
such Real Estate prepared by an Environmental Engineer as may be necessary or
advisable for the purpose of evaluating or confirming (i) whether any
Hazardous Substances are present in the soil or water at or adjacent to such
Real Estate and (ii) whether the use and operation of such Real Estate comply
with all Environmental Laws. Environmental assessments may include detailed
visual inspections of such Real Estate including, without limitation, any and
all storage areas, storage tanks, drains, dry xxxxx and leaching areas, and
the taking of soil samples, as well as such other investigations or analyses
as are necessary or appropriate for a complete determination of the
compliance of such Real Estate and the use and operation thereof with all
applicable Environmental Laws. All
-52-
such environmental assessments shall be at the sole cost and expense of the
Borrower.
-Section-8.7. DISTRIBUTIONS. The Borrower will not make any
Distributions which would cause it to violate any of the following covenants:
(a) Pay any Distribution to the shareholders of the Borrower if
such Distribution is in excess of the greater of (i) the minimum
Distributions required under the Code to maintain the REIT status of the
Borrower, and (ii) the amount which, when added to the amount of all other
Distributions paid in the same fiscal quarter, would exceed (a) eighty-five
percent (85%) of its Funds from Operations for such fiscal quarter (except
that, for the first fiscal quarter after the Closing Date only, such
percentage shall be increased to ninety-five percent (95%)), and (b) one
hundred ten percent (110%) of its Cash Available for Distribution for the
preceding four quarters (except that, commencing with any fiscal quarter
after December 31, 1996, such percentage shall be decreased to one hundred
percent (100%));
(b) In the event that an Event of Default shall have occurred and
be continuing, the Majority Banks may require that the Borrower make no
Distributions other than the minimum Distributions required under the Code to
maintain the REIT Status of the Borrower, as evidenced by a certification of
an Authorized Officer of the Borrower containing calculations in reasonable
detail satisfactory in form and substance to the Agent; and
(c) Notwithstanding the foregoing, at any time when an Event of
Default shall have occurred and the maturity of the Obligations has been
accelerated, the Majority Banks may prohibit Borrower from making any
Distributions whatsoever, directly or indirectly.
-Section-8.8. ASSET SALES. Neither the Borrower nor any Subsidiary
shall sell, transfer or otherwise dispose of any Real Estate or other
Investment described in -Section-8.3(j) or (k) or any of the Unencumbered
Operating Properties in excess of twenty percent (20%) of the value of the
Consolidated Total Assets of the Borrower, adjusted pursuant to -Section-9.7
(except as the result of a condemnation or casualty and except for the
granting of Permitted Liens, as applicable) unless there shall have been
delivered to the Banks a statement that no Default or Event of Default exists
and a certification that the Borrower will be in compliance with its
covenants referred to therein after giving effect to such sale, transfer or
other disposition.
-Section-8.9. DEVELOPMENT ACTIVITY. Neither the Borrower nor any
Subsidiary shall engage, directly or indirectly, in the development of
commercial real estate except for the development of one hundred percent
(100%) preleased, build-to-suit bulk distribution facilities, the aggregate
cost of which facilities (on a fully developed basis) under development at
any one time shall not exceed ten percent (10%) of the value of the
Consolidated Total Assets of the Borrower, adjusted pursuant to -Section-9.7.
For purposes of this -Section-8.9, the term "development" shall include new
construction or the substantial renovation or rehabilitation of improvements
to real property. A project shall be considered to be under development
until final certificates of occupancy or the equivalent have been issued for
the entire project and the project is 100% leased to tenants actually paying
rent. Without limiting the generality of the foregoing, the Borrower
-53-
acknowledges that for the purposes of this Agreement, (i) any interest by the
Borrower or any Subsidiary in a property which is proposed to be developed,
or any interest therein pursuant to which the Borrower or any Subsidiary has
the right to approve site plans or other plans and specifications or pursuant
to which such party's obligations are conditioned upon the achievement of
certain initial lease-up levels, or (ii) any agreement by the Borrower or any
Subsidiary which obligates such party to contribute or otherwise advance
funds in connection with or upon completion of the development of a property,
or (iii) any acquisition of a property which is proposed to be developed or
which is under development and initial lease-up at the time such agreement is
entered into, shall be considered a "development" for the purposes of this
-Section-8.9; provided, however, that nothing in this -Section-8.9 shall
prohibit the Borrower or any Subsidiary from entering into an agreement to
acquire Real Estate at a time when such Real Estate has been developed and
initially leased by another Person.
-Section-8.10. SOURCES OF CAPITAL. The Borrower shall, at all times
that the Borrower or any of its Subsidiaries is engaging in any development
as provided in -Section-8.9 or has entered into any agreement to acquire
properties under purchase agreements, maintain available sources of capital
equal to the total cost to acquire and complete such developments and to
purchase such properties, which sources of capital shall be acceptable to the
Agent in its reasonable discretion. Amounts available to be disbursed for
such purposes pursuant to this Agreement may be considered as a source of
capital for the purposes of this -Section-8.10. The Non-recourse
Indebtedness described in -Section-8.1(f) shall be considered a source of
such capital.
-Section-8.11. RESTRICTION ON PREPAYMENT OF INDEBTEDNESS. The Borrower
shall not prepay the principal amount, in whole or in part, of any
Indebtedness other than the Obligations after the occurrence of any Event of
Default; provided, however, that this -Section-8.11 shall not prohibit the
prepayment of Indebtedness which is financed solely from the proceeds of a
new loan which would otherwise be permitted by the terms of -Section-8.1.
-Section-9. FINANCIAL COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan or Note or
Letter of Credit is outstanding or any of the Banks has any obligation to
make any Loans or the Agent has any obligation to issue any Letters of Credit
it will comply with the following:
-Section-9.1. LIABILITIES TO TANGIBLE NET WORTH RATIO. The Borrower
will not, at the end of any fiscal quarter, permit the ratio of Consolidated
Total Liabilities to Consolidated Tangible Net Worth of the Borrower to
exceed 0.75 to 1.
-Section-9.2. DEBT COVERAGE. The Borrower will not, at the end of any
fiscal quarter, permit the Funds from Operations plus expensed interest for
such fiscal quarter and the preceding three fiscal quarters (the ATest
Period@) to be less than 2.5 times the Debt Service for the Test Period. For
purposes of testing compliance with this covenant only, if Debt Service
includes capitalized interest incurred as the result of Borrower or its
Subsidiary engaging in a development activity
-54-
permitted by -Section-8.9, Funds from Operations for each fiscal quarter in
which interest is so capitalized as a result of such development shall
include the Pro Forma Development Net Operating Income for such development.
For any fiscal quarter, the Pro Forma Development Net Operating Income shall
be the amount obtained by multiplying (x) the quarterly Net Operating Income
which the Borrower and the Agent mutually agree will be derived immediately
following the completion of such development project and the delivery of
leased premises to tenants with signed leases on the basis of such signed
leases in effect as of the date of such calculation (any cancellation or
termination options contained in such leases must be acceptable to the Agent
in the exercise of its reasonable discretion), by (y) the quotient obtained
by dividing (i) the amount of Loans advanced under this Agreement in
connection with the construction of such development project during the
fiscal quarter in question, by (ii) the total project costs incurred for such
development project as of the end of the fiscal quarter in question. The
Borrower shall provide the Agent with copies of such leases, information
regarding project costs and such other information, data and reports as the
Agent shall require in order to test compliance with this covenant.
-Section-9.3. FIXED CHARGE COVERAGE. The Borrower will not, at the end
of any fiscal quarter, permit the Cash Available for Distribution plus
expensed interest for any Test Period to be less than 1.75 times the Debt
Service for such Test Period.
-Section-9.4. BORROWING BASE. The Borrower will not, at the end of any
fiscal quarter, permit the Outstanding principal balance of the Loans and
Outstanding Letters of Credit (including Letters of Credit accepted but
unpaid) as of the date of determination to be greater than the Borrowing Base
as determined as of the same date.
-Section-9.5. TANGIBLE NET WORTH. The Borrower will not, at the end of
any fiscal quarter, permit its Consolidated Tangible Net Worth to be less
than $155,000,000.00 plus the amount of any net proceeds received from any
Equity Offering subsequent to March 1, 1996.
-Section-9.6. REAL ESTATE ASSETS.
(a) The Borrower shall not, for any fiscal quarter, permit the
Asset Value of its direct or indirect interests in joint ventures or
partnerships to exceed ten percent (10%) of the value of the Consolidated
Total Assets of the Borrower, adjusted pursuant to -Section-9.7; provided
that the Borrower shall be required to own a majority interest in any such
entities with full right, power and authority to control the underlying
assets thereof, including the right to encumber and convey such assets (the
forgoing limitation contained in this -Section-9.6shall not apply if the
Borrower and its Subsidiaries, on a Consolidated basis,own one hundred
percent (100%) of the total interests in such entities and nothird party
investors are involved).
(b) The Borrower shall not, for any fiscal quarter, permit its
direct or indirect interests in non-income producing land assets to exceed
three percent (3%) of the value of the Consolidated Total Assets of the
Borrower, adjusted pursuant to -Section-9.7.
-55-
-Section-9.7. VALUE ADJUSTMENT. The Borrower and the Banks have agreed
to a one-time market value adjustment to the Asset Value of each parcel of
Real Estate as contained in SCHEDULE 3 attached hereto and by this reference
incorporated herein, and the financial covenants set forth in -Section-9.1,
-Section-9.4, -Section-9.5 and -Section-9.6 shall for the term of this
Agreement be tested against the market value of each such parcel of Real
Estate, based on such one-time market value adjustment. As so adjusted, the
Asset Value of the Initial Unencumbered Operating Properties is
$110,689,687.00, and the Asset Value of the Real Estate is $269,416,009.00.
Within thirty (30) days of the Closing Date, the Borrower shall provide the
Agent with a schedule listing the book value of each parcel of Real Estate.
-Section-9.8. ANNUALIZATION OF RESULTS. In the event that the
covenants and other provisions contained in this Agreement shall require the
submission of data for four consecutive fiscal quarters and the Borrower
shall not have such data available at the time in question, the Agent shall
annualize the available data in such manner as the Agent shall determine in
its sole discretion so as to allow calculations and other tests to be
performed with respect to four consecutive fiscal quarters.
-Section-10. CLOSING CONDITIONS.
The obligations of the Agent and the Banks to make the initial Loans
and/or the Agent to issue the initial Letters of Credit shall be subject to
the satisfaction of the following conditions precedent on or prior to March
15, 1996:
-Section-10.1. LOAN DOCUMENTS. Each of the Loan Documents (including
any amendments to the Loan Documents securing the Original Credit Agreement
as required by the Agent) shall have been duly executed and delivered by the
respective parties thereto, shall be in full force and effect and shall be in
form and substance satisfactory to the Majority Banks. The Agent shall have
received a fully executed copy of each such document, except that each Bank
shall have received a fully executed counterpart of its Note. The Agent is
authorized by the Banks to execute on behalf of the Banks and the Agent, as
applicable, any amendments to the Loan Documents securing the Original Credit
Agreement.
-Section-10.2. CERTIFIED COPIES OF ORGANIZATIONAL DOCUMENTS. The Agent
shall have received from the Borrower and the Guarantor, a copy, certified as
of a recent date by the appropriate officer of each State in which the
Borrower and the Guarantor is organized and an Authorized Officer of the
Borrower and the Guarantor, as applicable, to be true and complete, of the
articles or certificate of incorporation of the Borrower and the agreement
and certificate of limited partnership of the Guarantor or its qualification
to do business, as applicable, as in effect on such date of certification (or
a certification satisfactory to the Agent that there have been no changes to
the foregoing since the date they were provided to the Agent in connection
with the execution of the Original Credit Agreement).
-56-
-Section-10.3. BYLAWS; RESOLUTIONS AND CONSENTS. All action on the
part of the Borrower and the Guarantor necessary for the valid execution,
delivery and performance by the Borrower and the Guarantor of this Agreement
and the other Loan Documents to which it is or is to become a party shall
have been duly and effectively taken, and evidence thereof satisfactory to
the Agent shall have been provided to the Agent. The Agent shall have
received from the Borrower true copies of its bylaws and the resolutions
adopted by its board of directors authorizing the transactions described
herein, and from the Guarantor all necessary partner consents authorizing the
transactions described herein, each certified by an Authorized Officer of the
Borrower and the Guarantor, as applicable, as of a recent date to be true
and complete (or a certification satisfactory to the Agent that there have
been no changes to the foregoing since the date they were provided to the
Agent in connection with the execution of the Original Credit Agreement).
-Section-10.4. INCUMBENCY CERTIFICATE; AUTHORIZED SIGNERS. The Agent
shall have received from the Borrower and the Guarantor an incumbency
certificate, dated as of the Closing Date, signed by an Authorized Officer of
the Borrower and the Guarantor, as applicable, and giving the name and
bearing a specimen signature of each individual who shall be authorized: (a)
to sign, in the name and on behalf of the Borrower and the Guarantor, each of
the Loan Documents to which the Borrower and the Guarantor is or is to become
a party; (b) to make Loan and Conversion Requests; and (c) to give notices
and to take other action on behalf of the Borrower and the Guarantor under
the Loan Documents.
-Section-10.5. OPINION OF COUNSEL. The Agent shall have received a
favorable opinion addressed to the Banks and the Agent and dated as of the
Closing Date, in form and substance satisfactory to the Agent, from each of
Xxxxxxx, Procter & Xxxx, Landels Xxxxxx & Diamond and Xxxxxxx, Xxxxx Xxxxxxx
& Xxxxxxxxx, counsel of the Borrower and the Guarantor, as to such matters as
the Agent shall reasonably request.
-Section-10.6. PAYMENT OF FEES. The Borrower shall have paid to the
Agent the fees required to be paid as of the Closing Date pursuant to
-Section-4.2.
-Section-10.7. PERFORMANCE; NO DEFAULT. The Borrower shall have
performed and complied with all terms and conditions herein required to be
performed or complied with by it on or prior to the Closing Date, and on the
Closing Date there shall exist no Default or Event of Default.
-Section-10.8. REPRESENTATIONS AND WARRANTIES. The representations and
warranties made by the Borrower and the Guarantor in the Loan Documents or
otherwise made by or on behalf of the Borrower, the Guarantor or any
Subsidiaries of the Borrower in connection therewith or after the date
thereof shall have been true and correct in all material respects when made
and shall also be true and correct in all material respects on the Closing
Date.
-Section-10.9. PROCEEDINGS AND DOCUMENTS. All proceedings in
connection with the transactions contemplated by this Agreement and the other
Loan Documents shall be reasonably satisfactory to the Agent and the Agent's
Special Counsel in form and substance, and the Agent shall have
-57-
received all information and such counterpart originals or certified copies
of such documents and such other certificates, opinions or documents as the
Agent and the Agent's Special Counsel may reasonably require.
-Section-10.10. COMPLIANCE CERTIFICATE. A Compliance Certificate dated
as of the date of the Closing Date demonstrating compliance with each of the
covenants calculated therein as of the most recent fiscal quarter end for
which the Borrower and the Guarantor have provided financial statements under
-Section-6.4, adjusted in the best good faith estimate of the Borrower and
the Guarantor and dated as of the date of the Closing Date shall have been
delivered to the Agent.
-Section-10.11. OTHER. The Agent shall have reviewed such other
documents, instruments, certificates, opinions, assurances, consents and
approvals as the Agent or the Agent's Special Counsel may reasonably have
requested.
-Section-10.12. INTENTIONALLY OMITTED.
-Section-10.13. INTENTIONALLY OMITTED.
-Section-10.14. EQUITY OFFERING. If the amount of the requested Loans
and/or Letters of Credit (plus the amount of any Outstanding Loans under the
Original Credit Agreement) exceeds the Funding Cap as of the date of this
Agreement, the Agent shall have received evidence reasonably satisfactory to
the Majority Banks that the Borrower shall have received gross proceeds from
an Equity Offering in at least the amount of the excess of the amount of such
Loans and/or Letters of Credit over the Funding Cap as of the date of this
Agreement.
-Section-10.15. TANGIBLE NET WORTH. The Borrower shall have a
Consolidated Tangible Net Worth, adjusted for market values pursuant to
-Section-9.7, of not less than $185,000,000.00.
-Section-10.16. DUE DILIGENCE. The Banks shall have completed and found
satisfactory their due diligence regarding the Unencumbered Operating
Projects.
-Section-10.17. MANAGEMENT OF THE BORROWER. There shall be no material
change in the management of the Borrower.
-Section-11. CONDITIONS TO ALL BORROWINGS.
The obligations of the Banks to make any Loan or of the Agent to issue
any Letter of Credit, whether on or after the Closing Date, shall also be
subject to the satisfaction of the following conditions precedent:
-Section-11.1. PRIOR CONDITIONS SATISFIED. All conditions set forth in
'10 shall continue to be satisfied as of the date upon which any Loan is to
be made.
-58-
-Section-11.2. REPRESENTATIONS TRUE; NO DEFAULT. Each of the
representations and warranties of the Borrower and the Guarantor contained in
this Agreement, the other Loan Documents or in any document or instrument
delivered pursuant to or in connection with this Agreement shall be true in
all material respects as of the date as of which they were made and shall
also be true in all material respects at and as of the time of the making of
such Loan, with the same effect as if made at and as of that time (except to
the extent of changes resulting from transactions contemplated or permitted
by this Agreement and the other Loan Documents and changes occurring in the
ordinary course of business that singly or in the aggregate are not
materially adverse, and except to the extent that such representations and
warranties relate expressly to an earlier date) and no Default or Event of
Default shall have occurred and be continuing. Each of the Banks shall have
received a certificate of the Borrower signed by an Authorized Officer of the
Borrower to such effect.
-Section-11.3. NO LEGAL IMPEDIMENT. No change shall have occurred in
any law or regulations thereunder or interpretations thereof that in the
reasonable opinion of any Bank would make it illegal for such Bank to make
such Loan.
-Section-11.4. GOVERNMENTAL REGULATION. Each Bank shall have received
such statements in substance and form reasonably satisfactory to such Bank as
such Bank shall require for the purpose of compliance with any applicable
regulations of the Comptroller of the Currency or the Board of Governors of
the Federal Reserve System.
-Section-11.5. PROCEEDINGS AND DOCUMENTS. All proceedings in
connection with the Loan shall be satisfactory in substance and in form to
the Majority Banks, and the Majority Banks shall have received all
information and such counterpart originals or certified or other copies of
such documents as the Majority Banks may reasonably request.
-Section-11.6. BORROWING DOCUMENTS. In the case of any request for a
Loan, the Agent shall have received a copy of the request for a Loan required
by -Section-2.6 in the form of EXHIBIT B hereto, fully completed.
-Section-12. EVENTS OF DEFAULT; ACCELERATION; ETC.
-Section-12.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the
following events ("Events of Default" or, if the giving of notice or the
lapse of time or both is required, then, prior to such notice or lapse of
time, "Defaults") shall occur:
(a) the Borrower shall fail to pay any principal of the Loans when
the same shall become due and payable, whether at the stated date of maturity
or any accelerated date of maturity or at any other date fixed for payment;
(b) the Borrower shall fail to pay any interest on the Loans or
any other sums due hereunder or under any of the other Loan Documents, when
the same shall become due and
-59-
payable, whether at the stated date of maturity or any accelerated date of
maturity or at any other date fixed for payment;
(c) the Borrower shall fail to comply with any covenant contained
in -Section-7.15 or -Section-7.16;
(d) the Borrower shall fail to comply with any covenant contained
in Article 9, and such failure shall continue for 45 days after written
notice thereof shall have been given to the Borrower by the Agent;
(e) the Borrower or any of its Subsidiaries or the Guarantor shall
fail to perform any other term, covenant or agreement contained herein or in
any of the other Loan Documents (other than those specified above in this
-Section-12);
(f) any representation or warranty of the Borrower or any of its
Subsidiaries or the Guarantor in this Agreement or any other Loan Document,
or in any report, certificate, financial statement, request for a Loan, or in
any other document or instrument delivered pursuant to or in connection with
this Agreement, any advance of a Loan or any of the other Loan Documents
shall prove to have been false in any material respect upon the date when
made or deemed to have been made or repeated;
(g) the Borrower or any of its Subsidiaries or the Guarantor shall
fail to pay at maturity, or within any applicable period of grace, any
obligation for borrowed money or credit received or other Indebtedness,
including, without limitation, the Prudential Loan, or fail to observe or
perform any material term, covenant or agreement contained in any agreement
by which it is bound, evidencing or securing any such borrowed money or
credit received or other Indebtedness for such period of time as would permit
(assuming the giving of appropriate notice if required) the holder or holders
thereof or of any obligations issued thereunder to accelerate the maturity
thereof;
(h) the Borrower or any of its Subsidiaries or the Guarantor, (A)
shall make an assignment for the benefit of creditors, or admit in writing
its general inability to pay or generally fail to pay its debts as they
mature or become due, or shall petition or apply for the appointment of a
trustee or other custodian, liquidator or receiver of the Borrower or any of
its Subsidiaries or the Guarantor or of any substantial part of the assets of
any thereof, (B) shall commence any case or other proceeding relating to the
Borrower or any of its Subsidiaries or the Guarantor under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction, now or hereafter in effect,
or (C) shall take any action to authorize or in furtherance of any of the
foregoing;
(i) a petition or application shall be filed for the appointment
of a trustee or other custodian, liquidator or receiver of the Borrower or
any of its Subsidiaries or the Guarantor or any substantial part of the
assets of any thereof, or a case or other proceeding shall be
-60-
commenced against the Borrower or any of its Subsidiaries or the Guarantor
underany bankruptcy, reorganization, arrangement, insolvency, readjustment of
debt,dissolution or liquidation or similar law of any jurisdiction, now or
hereafter in effect, and the Borrower or any of its Subsidiaries or the
Guarantor shall indicate its approval thereof, consent thereto or
acquiescence therein or such petition, application, case or proceeding shall
not have been dismissed within 60 days following the filing or commencement
thereof;
(j) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or any of its
Subsidiaries or the Guarantor bankrupt or insolvent, or approving a petition
in any such case or other proceeding, or a decree or order for relief is
entered in respect of the Borrower or any of its Subsidiaries or the
Guarantor, in each case of the foregoing in an involuntary case under federal
bankruptcy laws as now or hereafter constituted;
(k) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than 60 days, whether or not consecutive, any uninsured
final judgment against the Borrower or any of its Subsidiaries or the
Guarantor that, with other outstanding uninsured final judgments,
undischarged, against the Borrower or any of its Subsidiaries or the
Guarantor exceeds in the aggregate $5,000,000.00;
(l) if any of the Loan Documents shall be canceled, terminated,
revoked or rescinded otherwise than in accordance with the terms thereof or
with the express prior written agreement, consent or approval of the Banks,
or any action at law, suit in equity or other legal proceeding to cancel,
revoke or rescind any of the Loan Documents shall be commenced by or on
behalf of the Borrower or the Guarantor or any of its holders of Voting
Interests, or any court or any other governmental or regulatory authority or
agency of competent jurisdiction shall make a determination that, or issue a
judgment, order, decree or ruling to the effect that, any one or more of the
Loan Documents is illegal, invalid or unenforceable in accordance with the
terms thereof in any material respect as determined by the Majority Banks;
(m) any dissolution, termination, partial or complete liquidation,
merger or consolidation of the Borrower or the Guarantor, or any sale,
transfer or other disposition of the assets of the Borrower or the Guarantor,
other than as permitted under the terms of this Agreement or the other Loan
Documents;
(n) any suit or proceeding shall be filed against the Borrower or
the Guarantor or any of their respective assets which in the good faith
business judgment of the Majority Banks after giving consideration to the
likelihood of success of such suit or proceeding and the availability of
insurance to cover any judgment with respect thereto and based on the
information available to them, if adversely determined, would have a
materially adverse affect on the ability of the Borrower or the Guarantor to
perform each and every one of its obligations under and by virtue of the Loan
Documents;
-61-
(o) the Borrower or the Guarantor, shall be indicted for a federal
crime, a punishment for which could include the forfeiture of any assets of
the Borrower or the Guarantor;
(p) Xxxxx X. Xxxxxxxx shall cease to be the Chairman of the Board
and Xxxxxx Xxxxxx shall cease to be the President of the Borrower, and a
competent and experienced successor for such Person shall not be approved by
the Majority Banks within three (3) months of such event;
(q) the Borrower shall no longer own directly or indirectly one
hundred percent (100%) of the Voting Interests of the Guarantor;
(r) the Guarantor denies that the Guarantor has any liability or
obligation under the Guaranty, or shall notify the Agent or any of the Banks
of the Guarantor's intention to attempt to cancel or terminate the Guaranty,
or shall fail to observe or comply with any term, covenant, condition or
agreement under the Guaranty; or
(s) the Borrower shall make any payment with respect to the
Debentures, including principal thereto or interest or premium thereon,
except as specifically approved by the Banks as provided herein or any
subordination and standstill agreement executed pursuant hereto or there
shall be a default by Ameritech pursuant to any subordination and standstill
agreement executed pursuant hereto;
then, and in any such event, the Agent may, and upon the request of the
Majority Banks shall, by notice in writing to the Borrower declare all
amounts owing with respect to this Agreement, the Notes and the other Loan
Documents to be, and they shall thereupon forthwith become, immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby expressly waived by the Borrower; PROVIDED that in
the event of any Event of Default specified in Section 12.1(h), Section
12.1(i) or Section 12.1(j), all such amounts shall become immediately due and
payable automatically and without any requirement of notice from any of the
Banks or the Agent. The Borrower and any other Person shall be entitled to
conclusively rely on a statement from the Agent that it has the authority to
act for and bind the Banks pursuant to this Agreement and the other Loan
Documents.
Section 12.2. LIMITATION OF CURE PERIODS. Notwithstanding anything
contained in Section 12.1 to the contrary, (i) no Event of Default shall
exist hereunder upon the occurrence of any failure described in Section
12.1(a) or Section 12.1(b) in the event that the Borrower cures such default
within five (5) days following receipt of written notice of such default,
provided that no such cure period shall apply to any payments due upon the
maturity of the Notes; (ii) no Event of Default shall exist hereunder upon
the occurrence of any failure described in Section 12.1(c) as it pertains to
Section 7.15 only in the event that the Borrower cures such default within
sixty (60) days following receipt of written notice of such default; and
(iii) no Event of Default shall exist hereunder upon the occurrence of any
failure described in Section 12.1(e) in the event that the Borrower cures
such default within forty-five (45) days following receipt of written notice
of such default, provided that the provisions of
-62-
this clause (iii) shall not pertain to any default consisting of a failure to
comply with Section 7.4(e), or to any default excluded from any provision of
cure of defaults contained in any other of the Loan Documents.
Section 12.3. TERMINATION OF COMMITMENTS. If any one or more Events
of Default specified in Section 12.1(h), Section 12.1(i), Section 12.1(j),
Section 12.1(l) or Section 12.1(r) shall occur, then immediately and without
any action on the part of the Agent or any Bank any unused portion of the
credit hereunder shall terminate and the Banks shall be relieved of all
obligations to make Loans or provide Letters of Credit to the Borrower. If
any other Event of Default shall have occurred and be continuing, the Agent,
upon the election of the Majority Banks, may by notice to the Borrower
terminate the obligation to make Loans or provide Letters of Credit to the
Borrower. No termination under this Section 12.2 shall relieve the Borrower
of its obligations to the Banks arising under this Agreement or the other
Loan Documents.
Section 12.4. REMEDIES. In case any one or more of the Events of
Default shall have occurred and be continuing, and whether or not the Banks
shall have accelerated the maturity of the Loans pursuant to Section 12.1,
the Agent on behalf of the Banks, may, with the consent of the Majority Banks
but not otherwise, proceed to protect and enforce their rights and remedies
under this Agreement, the Notes or any of the other Loan Documents by suit in
equity, action at law or other appropriate proceeding, whether for the
specific performance of any covenant or agreement contained in this Agreement
and the other Loan Documents or any instrument pursuant to which the
Obligations are evidenced, including to the full extent permitted by
applicable law the obtaining of the EX PARTE appointment of a receiver, and,
if such amount shall have become due, by declaration or otherwise, proceed to
enforce the payment thereof or any other legal or equitable right. No remedy
herein conferred upon the Agent or the holder of any Note is intended to be
exclusive of any other remedy and each and every remedy shall be cumulative
and shall be in addition to every other remedy given hereunder or now or
hereafter existing at law or in equity or by statute or any other provision
of law. In the event that all or any portion of the Obligations is collected
by or through an attorney-at-law, the Borrower shall pay all costs of
collection including, but not limited to, reasonable attorney's fees not to
exceed fifteen percent (15%) of such portion of the Obligations.
Notwithstanding anything herein to the contrary, upon the occurrence of any
Event of Default, an amount equal to the aggregate amount of the Outstanding
Letters of Credit (including Letters of Credit accepted but unpaid) shall, at
the Majority Banks' option, without demand upon or further notice to the
Borrower, be deemed to have been paid or disbursed by the Agent under the
Letter of Credit and a Loan to the Borrower from the Banks in such amount to
have been made and accepted, which Loan shall be immediately due and payable.
Section 12.5. DISTRIBUTION OF PROCEEDS. In the event that, following
the occurrence or during the continuance of any Event of Default, any monies
are received in connection with the enforcement of any of the Loan Documents,
or otherwise with respect to the realization upon any of the assets of the
Borrower, such monies shall be distributed for application as follows:
-63-
(a) First, to the payment of, or (as the case may be) the
reimbursement of, the Agent for or in respect of all reasonable costs,
expenses, disbursements and losses which shall have been incurred or
sustained by the Agent in connection with the collection of such monies by
the Agent, for the exercise, protection or enforcement by the Agent of all or
any of the rights, remedies, powers and privileges of the Agent under this
Agreement or any of the other Loan Documents or in support of any provision
of adequate indemnity to the Agent against any taxes or liens which by law
shall have, or may have, priority over the rights of the Agent to such monies;
(b) Second, to all other Obligations in such order or preference
as the Majority Banks shall determine; PROVIDED, HOWEVER, that (i) in the
event that any Bank shall have wrongfully failed or refused to make an
advance under Section 2.7 and such failure or refusal shall be continuing,
advances made by other Banks during the pendency of such failure or refusal
shall be entitled to be repaid as to principal and accrued interest in
priority to the other Obligations described in this subsection (b), and (ii)
Obligations owing to the Banks with respect to each type of Obligation such
as interest, principal, fees and expenses, shall be made among the Banks PRO
RATA; and PROVIDED, further that the Majority Banks may in their discretion
make proper allowance to take into account any Obligations not then due and
payable; and
(c) Third, the excess, if any, shall be returned to the Borrower or
to such other Persons as are entitled thereto.
Section 13. INTENTIONALLY OMITTED.
Section 14. THE AGENT.
Section 14.1. AUTHORIZATION. The Agent is authorized to take such
action on behalf of each of the Banks and to exercise all such powers as are
hereunder and under any of the other Loan Documents and any related documents
delegated to the Agent, together with such powers as are reasonably incident
thereto, PROVIDED that no duties or responsibilities not expressly assumed
herein or therein shall be implied to have been assumed by the Agent. The
relationship between the Agent and the Banks is and shall be that of agent
and principal only, and nothing contained in this Agreement or any of the
other Loan Documents shall be construed to constitute the Agent as a trustee
for any Bank. Unless they have been expressly notified in writing by all of
the Banks to the contrary, the Borrower and any other Person shall be
entitled to conclusively rely on a statement from the Agent that it has the
authority to act for and bind the Banks pursuant to this Agreement and the
other Loan Documents.
Section 14.2. EMPLOYEES AND AGENTS. The Agent may exercise its powers
and execute its duties by or through employees or agents and shall be
entitled to take, and to rely on, advice of counsel concerning all matters
pertaining to its rights and duties under this Agreement and the other Loan
Documents. The Agent may utilize the services of such Persons as the Agent
may reasonably determine, and all reasonable fees and expenses of any such
Persons shall be paid by the
-64-
Borrower.
Section 14.3. NO LIABILITY. Neither the Agent nor any of its
shareholders, directors, officers or employees nor any other Person assisting
them in their duties nor any agent, or employee thereof, shall be liable for
any waiver, consent or approval given or any action taken, or omitted to be
taken, in good faith by it or them hereunder or under any of the other Loan
Documents, or in connection herewith or therewith, or be responsible for the
consequences of any oversight or error of judgment whatsoever, except that
the Agent or such other Person, as the case may be, may be liable for losses
due to its willful misconduct or gross negligence.
Section 14.4. NO REPRESENTATIONS. The Agent shall not be responsible
for the execution or validity or enforceability of this Agreement, the Notes,
any of the other Loan Documents or any instrument at any time constituting,
or intended to constitute, collateral security for the Notes, or for the
value of any such collateral security or for the validity, enforceability or
collectability of any such amounts owing with respect to the Notes, or for
any recitals or statements, warranties or representations made herein or in
any of the other Loan Documents or in any certificate or instrument hereafter
furnished to it by or on behalf of the Borrower or any of its Subsidiaries or
the Guarantor, or be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or
in any other of the Loan Documents. The Agent shall not be bound to
ascertain whether any notice, consent, waiver or request delivered to it by
the Borrower or the Guaranty or any holder of any of the Notes shall have
been duly authorized or is true, accurate and complete. The Agent has not
made nor does it now make any representations or warranties, express or
implied, nor does it assume any liability to the Banks, with respect to the
creditworthiness or financial condition of the Borrower or any of its
Subsidiaries or the Guarantor. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank, and
based upon such information and documents as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each Bank
also acknowledges that it will, independently and without reliance upon the
Agent or any other Bank, based upon such information and documents as it
deems appropriate at the time, continue to make its own credit analysis and
decisions in taking or not taking action under this Agreement and the other
Loan Documents.
Section 14.5. PAYMENTS.
(a) A payment by the Borrower or the Guarantor to the Agent
hereunder or under any of the other Loan Documents for the account of any
Bank shall constitute a payment to such Bank. The Agent agrees to exercise
reasonable efforts to distribute to each Bank on the same day as (but in no
event later than one Business Day after) the Agent's receipt of good funds,
determined in accordance with the Agent's customary practices, such Bank's
PRO RATA share of payments received by the Agent for the account of the Banks
except as otherwise expressly provided herein or in any of the other Loan
Documents. In the event that the Agent fails to distribute such amounts
within one Business Day as provided above, the Agent shall pay interest on
such amount at a rate per annum equal to the Federal Funds Effective Rate
from time to time
-65-
in effect.
(b) If in the opinion of the Agent the distribution of any amount
received by it in such capacity hereunder, under the Notes or under any of
the other Loan Documents might involve it in liability, it may refrain from
making distribution until its right to make distribution shall have been
adjudicated by a court of competent jurisdiction. If a court of competent
jurisdiction shall adjudge that any amount received and distributed by the
Agent is to be repaid, each Person to whom any such distribution shall have
been made shall either repay to the Agent its proportionate share of the
amount so adjudged to be repaid or shall pay over the same in such manner and
to such Persons as shall be determined by such court.
(c) Notwithstanding anything to the contrary contained in this
Agreement or any of the other Loan Documents, any Bank that fails (i) to make
available to the Agent its PRO RATA share of any Loan or (ii) to comply with
the provisions of Section 13 with respect to making dispositions and
arrangements with the other Banks, where such Bank's share of any payment
received, whether by setoff or otherwise, is in excess of its PRO RATA share
of such payments due and payable to all of the Banks, in each case as, when
and to the full extent required by the provisions of this Agreement, shall be
deemed delinquent (a "Delinquent Bank") and shall be deemed a Delinquent Bank
until such time as such delinquency is satisfied. A Delinquent Bank shall be
deemed to have assigned any and all payments due to it from the Borrower and
the Guarantor, whether on account of outstanding Loans, interest, fees or
otherwise, to the remaining nondelinquent Banks for application to, and
reduction of, their respective PRO RATA shares of all Outstanding Loans. The
Delinquent Bank hereby authorizes the Agent to distribute such payments to
the nondelinquent Banks in proportion to their respective PRO RATA shares of
all Outstanding Loans. A Delinquent Bank shall be deemed to have satisfied
in full a delinquency when and if, as a result of application of the assigned
payments to all Outstanding Loans of the nondelinquent Banks or as a result
of other payments by the Delinquent Banks to the nondelinquent Banks, the
Banks' respective PRO RATA shares of all Outstanding Loans have returned to
those in effect immediately prior to such delinquency and without giving
effect to the nonpayment causing such delinquency.
Section 14.6. HOLDERS OF NOTES. Subject to the terms of Article 18,
the Agent may deem and treat the payee of any Note as the absolute owner or
purchaser thereof for all purposes hereof until it shall have been furnished
in writing with a different name by such payee or by a subsequent holder,
assignee or transferee.
Section 14.7. INDEMNITY. The Banks ratably agree hereby to indemnify
and hold harmless the Agent from and against any and all claims, actions and
suits (whether groundless or otherwise), losses, damages, costs, expenses
(including any reasonable expenses for which the Agent has not been
reimbursed by the Borrower as required by Section 15), and liabilities of
every nature and character arising out of or related to this Agreement, the
Notes, or any of the other Loan Documents or the transactions contemplated or
evidenced hereby or thereby, or the Agent's actions taken hereunder or
thereunder, except to the extent that any of the same shall be directly
-66-
caused by the Agent's willful misconduct or gross negligence.
Section 14.8. AGENT AS BANK. In its individual capacity, FNBB shall
have the same obligations and the same rights, powers and privileges in
respect to its Commitment and the Loans made by it, and as the holder of any
of the Notes as it would have were it not also the Agent.
Section 14.9. RESIGNATION. Subject to the terms of Section 18.1, the
Agent may resign at any time by giving 60 days' prior written notice thereof
to the Banks and the Borrower. Upon any such resignation, the Co-Agent shall
be appointed as a successor Agent provided that the Co-Agent is still a Bank,
the Co-Agent's senior debt obligations are rated not less than "A" or its
equivalent by Xxxxx'x Investors Service, Inc. or not less than "A" or its
equivalent by Standard & Poor's Corporation and the Co-Agent has total
assets in excess of $10,000,000,000.00. If the Co-Agent fails to satisfy
such conditions or declines to serve as Agent, the Majority Banks shall have
the right to appoint as a successor Agent any Bank or any other banks
satisfying the conditions contained in the immediately preceding sentence.
Unless a Default or Event of Default shall have occurred and be continuing,
such successor Agent (including the Co-Agent) shall be reasonably acceptable
to the Borrower. If no successor Agent shall have been so appointed by the
Majority Banks and shall have accepted such appointment within 30 days after
the retiring Agent's giving of notice of resignation, then the retiring Agent
may, on behalf of the Banks, appoint a successor Agent, which shall be a bank
whose debt obligations are rated not less than "A" or its equivalent by
Xxxxx'x Investors Service, Inc. or not less than "A" or its equivalent by
Standard & Poor's Corporation and which has total assets in excess of
$10,000,000,000.00. 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 retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations hereunder as Agent. After any retiring Agent's
resignation, the provisions of this Agreement and the other Loan Documents
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.
Section 14.10. DUTIES IN THE CASE OF ENFORCEMENT. In case one or more
Events of Default have occurred and shall be continuing, and whether or not
acceleration of the Obligations shall have occurred, the Agent shall, if (a)
so requested by the Majority Banks and (b) the Banks have provided to the
Agent such additional indemnities and assurances against expenses and
liabilities as the Agent may reasonably request, proceed to exercise all or
any legal and equitable and other rights or remedies as it may have. The
Majority Banks may direct the Agent in writing as to the method and the
extent of any such exercise, the Banks hereby agreeing to indemnify and hold
the Agent harmless from all liabilities incurred in respect of all actions
taken or omitted in accordance with such directions, PROVIDED that the Agent
need not comply with any such direction to the extent that the Agent
reasonably believes the Agent's compliance with such direction to be unlawful
or commercially unreasonable in any applicable jurisdiction.
Section 14.11. DETERMINATIONS BY AGENT. Any and all determinations to
be made by the Agent pursuant to the provisions of this Agreement shall be
conclusive and binding absent manifest
-67-
error and so long as the same shall be determined in good faith by the
Agent. Where no procedures for such determinations are specified, such
determinations shall be made in such manner as Agent shall determine in its
sole discretion, subject to the provisions of this Section 14.11.
Section 15. EXPENSES.
The Borrower agrees to pay (a) the reasonable costs of producing and
reproducing this Agreement, the other Loan Documents and the other agreements
and instruments mentioned herein, (b) any taxes (including any interest and
penalties in respect thereto) payable by the Agent or any of the Banks (other
than taxes based upon the Agent's or any Bank's gross or net income),
including any recording, mortgage, documentary or intangibles taxes in
connection with the Loan Documents, or other taxes payable on or with respect
to the transactions contemplated by this Agreement, including any such taxes
payable by the Agent or any of the Banks after the Closing Date under the
Original Credit Agreement (the Borrower hereby agreeing to indemnify the
Agent and each Bank with respect thereto), (c) all reasonable internal
charges of the Agent (determined in good faith and in accordance with the
Agent's internal policies applicable generally to its customers) for
commercial finance exams and engineering and environmental reviews and the
reasonable fees, expenses and disbursements of the counsel to the Agent,
counsel for the Banks and any local counsel to the Agent incurred in
connection with the preparation, administration or interpretation of the Loan
Documents and other instruments mentioned herein (excluding, however, the
preparation of agreements evidencing participations granted under Section
18.4), each closing hereunder, and amendments, modifications, approvals,
consents or waivers hereto or hereunder, (d) the reasonable fees, expenses
and disbursements of the Agent incurred by the Agent in connection with the
preparation, administration or interpretation of the Loan Documents and other
instruments mentioned herein, and the making of each advance hereunder, (e)
all reasonable out-of-pocket expenses (including reasonable attorneys' fees
and costs, which attorneys may be employees of any Bank or the Agent and the
fees and costs of appraisers, engineers, investment bankers or other experts
retained by any Bank or the Agent) incurred by any Bank or the Agent in
connection with (i) the enforcement of or preservation of rights under any of
the Loan Documents against the Borrower or the Guarantor or the
administration thereof after the occurrence of a Default or Event of Default
and (ii) any litigation, proceeding or dispute whether arising hereunder or
otherwise, in any way related to the Agent's or any of the Bank's
relationship with the Borrower or the Guarantor, and (f) all reasonable fees,
expenses and disbursements of any Bank or the Agent incurred in connection
with UCC searches, UCC filings, title rundowns or title searches. The
covenants of this Section 15 shall survive payment or satisfaction of payment
of amounts owing with respect to the Notes. Notwithstanding the foregoing,
each of the Banks (excluding the Agent) shall only be entitled to recover up
to $5,000.00 each for the fees, expenses and disbursements of their counsel
incurred on or before the Closing Date.
Section 16. INDEMNIFICATION.
The Borrower agrees to indemnify and hold harmless the Agent and the
Banks and each director, officer, employee, agent, attorney and any Person
who controls the Agent or any Bank
-68-
from and against any and all claims, actions and suits, whether groundless
or otherwise, and from and against any and all liabilities, losses, damages
and expenses of every nature and character arising out of or relating to this
Agreement or any of the other Loan Documents or the transactions contemplated
hereby and thereby including, without limitation, (a) any leasing fees and
any brokerage, finders or similar fees asserted against any Person
indemnified under this Section 16 based upon any agreement, arrangement or
action made or taken, or alleged to have been made or taken, by the Borrower
or any of its Subsidiaries or the Guarantor, (b) any condition of the Real
Estate, (c) any actual or proposed use by the Borrower of the proceeds of any
of the Loans or any actual or proposed use of a Letter of Credit by any
beneficiary of a Letter of Credit, (d) any actual or alleged infringement of
any patent, copyright, trademark, service xxxx or similar right of the
Borrower or any of its Subsidiaries or the Guarantor, (e) the Borrower and
the Guarantor entering into or performing this Agreement or any of the other
Loan Documents, (f) any actual or alleged violation of any law, ordinance,
code, order, rule, regulation, approval, consent, permit or license relating
to the Real Estate, or (g) with respect to the Borrower and its Subsidiaries
and the Guarantor and their respective properties and assets, the violation
of any Environmental Law, the Release or threatened Release of any Hazardous
Substances or any action, suit, proceeding or investigation brought or
threatened with respect to any Hazardous Substances (including, but not
limited to claims with respect to wrongful death, personal injury or damage
to property), in each case including, without limitation, the reasonable fees
and disbursements of counsel and allocated costs of internal counsel incurred
in connection with any such investigation, litigation or other proceeding;
PROVIDED, HOWEVER, that the Borrower shall not be obligated under this
Section 16 to indemnify any Person for liabilities arising from such Person's
own gross negligence or willful misconduct. In litigation, or the
preparation therefor, the Banks and the Agent shall be entitled to select a
single law firm as their own counsel and, in addition to the foregoing
indemnity, the Borrower agrees to pay promptly the reasonable fees and
expenses of such counsel. If, and to the extent that the obligations of the
Borrower under this Section 16 are unenforceable for any reason, the Borrower
hereby agrees to make the maximum contribution to the payment in satisfaction
of such obligations which is permissible under applicable law. The
provisions of this '16 shall survive the repayment of the Loans and the
termination of the obligations of the Banks hereunder.
Section 17. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made herein,
in the Notes, in any of the other Loan Documents or in any documents or other
papers delivered by or on behalf of the Borrower or any of its Subsidiaries
or the Guarantor pursuant hereto or thereto shall be deemed to have been
relied upon by the Banks and the Agent, notwithstanding any investigation
heretofore or hereafter made by any of them, and shall survive the making by
the Banks of any of the Loans, as herein contemplated, and shall continue in
full force and effect so long as any amount due under this Agreement, the
Notes, the Letters of Credit or any of the other Loan Documents remains
outstanding or any Bank has any obligation to make any Loans or the Agent has
any obligation to issue any Letters of Credit. The indemnification
obligations of the Borrower provided herein and the other Loan Documents
shall survive the full repayment of
-69-
amounts due and the termination of the obligations of the Banks hereunder
and thereunder to the extent provided herein and therein. All statements
contained in any certificate or other paper delivered to any Bank or the
Agent at any time by or on behalf of the Borrower or any of its Subsidiaries
or the Guarantor pursuant hereto or in connection with the transactions
contemplated hereby shall constitute representations and warranties by the
Borrower or such Subsidiary or the Guarantor hereunder.
Section 18. ASSIGNMENT AND PARTICIPATION.
Section 18.1. CONDITIONS TO ASSIGNMENT BY BANKS. Except as provided
herein, each Bank may assign to another bank or other entity all (but not
less than all) of its interests, rights and obligations under this Agreement
(including all of its Commitment Percentage and Commitment and the same
portion of the Loans at the time owing to it, and the Notes held by it);
provided that (a) the Agent shall have given its prior written consent to
such assignment, which consent shall not be unreasonably withheld (provided
that such consent shall not be required for any assignment to another Bank,
to a bank which is under common control with the assigning Bank or to a
wholly-owned Subsidiary of such Bank provided that such assignee shall remain
a wholly-owned Subsidiary of such Bank), (b) the Borrower shall have given
its prior written consent to such assignment, which consent shall not be
unreasonably withheld or delayed (provided that such consent shall not be
required if a Default or Event of Default shall have occurred and be
continuing or for any assignment to another Bank, to a bank which is under
common control with the assigning Bank or to a wholly-owned Subsidiary of
such Bank provided that such assignee shall remain a wholly-owned Subsidiary
of such Bank), (c) each such assignment shall be of all the assigning Bank's
rights and obligations under this Agreement, (d) the parties to such
assignment shall execute and deliver to the Agent, for recording in the
Register (as hereinafter defined), a notice of such assignment, together with
any Notes subject to such assignment, (e) in no event shall any voting,
consent or approval rights of a Bank be assigned to any Person controlling,
controlled by or under common control with, or which is not otherwise free
from influence or control by, the Borrower or the Guarantor, which rights
shall instead be allocated PRO RATA among the other remaining Banks, (f) such
assignee shall have a net worth as of the date of such assignment of not less
than $500,000,000, and (g) such assignment is subject to the terms of any
intercreditor agreement among the Banks and the Agent. Upon such execution,
delivery, acceptance and recording, of such notice of assignment, (i) the
assignee thereunder shall be a party hereto and all other Loan Documents
executed by the Banks and, to the extent provided in such assignment, have
the rights and obligations of a Bank hereunder, (ii) the assigning Bank
shall, to the extent provided in such assignment and upon payment to the
Agent of the registration fee referred to in Section 18.2, be released from
its obligations under this Agreement, and (iii) the Agent may unilaterally
amend SCHEDULE 1 to reflect such assignment. In connection with each
assignment, the assignee shall represent and warrant to the Agent, the
assignor and each other Bank as to whether such assignee is controlling,
controlled by, under common control with or is not otherwise free from
influence or control by, the Borrower and the Guarantor.
-70-
Section 18.2. REGISTER. The Agent shall maintain a copy of each
assignment delivered to it and a register or similar list (the "Register")
for the recordation of the names and addresses of the Banks and the
Commitment Percentages of, and principal amount of the Loans owing to the
Banks from time to time. The entries in the Register shall be conclusive, in
the absence of manifest error, and the Borrower, the Agent and the Banks may
treat each Person whose name is recorded in the Register as a Bank hereunder
for all purposes of this Agreement. The Register shall be available for
inspection by the Borrower and the Banks at any reasonable time and from time
to time upon reasonable prior notice. Upon each such recordation, the
assigning Bank agrees to pay to the Agent a registration fee in the sum of
$2,000.
Section 18.3. NEW NOTES. Upon its receipt of an assignment executed by
the parties to such assignment, together with each Note subject to such
assignment, the Agent shall (a) record the information contained therein in
the Register, and (b) give prompt notice thereof to the Borrower and the
Banks (other than the assigning Bank). Within five Business Days after
receipt of such notice, the Borrower, at its own expense, shall execute and
deliver to the Agent, in exchange for each surrendered Note, a new Note to
the order of such assignee in an amount equal to the amount assumed by such
assignee pursuant to such assignment, and shall cause the Guarantor to
deliver to the Agent an acknowledgment in form and substance satisfactory to
the Agent to the effect that the Guaranty extends to and is applicable to
each new Note. Such new Note shall provide that it is a replacement for the
surrendered Note, shall be in an aggregate principal amount equal to the
aggregate principal amount of the surrendered Note, shall be dated the
effective date of such assignment and shall otherwise be in substantially the
form of the assigned Note. The surrendered Note shall be canceled and
returned to the Borrower.
Section 18.4. PARTICIPATIONS. Each Bank may sell participations to one
or more banks or other entities in all or a portion of such Bank's rights and
obligations under this Agreement and the other Loan Documents; PROVIDED that
(a) any such sale or participation shall not affect the rights and duties of
the selling Bank hereunder to the Borrower, (b) such sale and participation
shall not entitle such participant to any rights or privileges under this
Agreement or the Loan Documents (including, without limitation, the right to
approve waivers, amendments or modifications), (c) such participant shall
have no direct rights against the Borrower or the Guarantor except the rights
granted to the Banks pursuant to Section 13, and (d) such participant shall
not be a Person controlling, controlled by or under common control with, or
which is not otherwise free from influence or control by, the Borrower or the
Guaranty.
Section 18.5. PLEDGE BY BANK. Any Bank may at any time pledge all or
any portion of its interest and rights under this Agreement (including all or
any portion of its Note) to any of the twelve Federal Reserve Banks organized
under Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such
pledge or the enforcement thereof shall release the pledgor Bank from its
obligations hereunder or under any of the other Loan Documents.
Section 18.6. NO ASSIGNMENT BY BORROWER. The Borrower shall not assign
or transfer any of its rights or obligations under any of the Loan Documents
without the prior written consent of each
of the Banks.
Section 18.7. DISCLOSURE. The Borrower agrees that in addition to
disclosures made in accordance with standard banking practices any Bank may
disclose information obtained by such Bank pursuant to this Agreement to
assignees or participants and potential assignees or participants hereunder
provided the Borrower receives prior notice of such disclosures unless such
participant or assignee is one of the Banks.
Section 19. NOTICES.
Each notice, demand, election or request provided for or permitted to be
given pursuant to this Agreement (hereinafter in this Section 19 referred to
as "Notice"), but specifically excluding to the maximum extent permitted by
law any notices of the institution or commencement of foreclosure
proceedings, must be in writing and shall be deemed to have been properly
given or served by personal delivery or by sending same by overnight courier
or by depositing same in the United States Mail, postpaid and registered or
certified, return receipt requested, or as expressly permitted herein, by
telegraph, telecopy, telefax or telex, and addressed as follows:
If to the Agent or FNBB:
The First National Bank of Boston
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Real Estate Division
(000) 000-0000
(000) 000-0000 (FAX)
With a copy to:
The First National Bank of Boston
000 X. Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxx, Vice President
(000) 000-0000
(000) 000-0000 (FAX)
and to:
The First National Bank of Boston
000 Xxxxxxxxx Xxxxxx Xxxxx, X.X., Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx Xxxxxxx
(000) 000-0000
-72-
(000) 000-0000 (FAX)
If to the Borrower:
Meridian Industrial Trust, Inc.
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxx, Chief Executive Officer
(000) 000-0000
(000) 000-0000 (FAX)
if to a Bank now a party to this Agreement, at the address set forth below
the signature of such Bank attached to this Agreement, and to each other Bank
which may hereafter become a party to this Agreement at such address as may
be designated by such Bank. Each Notice shall be effective upon being
personally delivered or upon being sent by overnight courier or upon being
deposited in the United States Mail as aforesaid or, if sent by facsimile
transmission, upon receipt of such transmission as evidenced by the
confirmation notice. The time period in which a response to such Notice must
be given or any action taken with respect thereto (if any), however, shall
commence to run from the date of receipt if personally delivered, sent by
overnight courier or sent by facsimile transmission, or if so deposited in
the United States Mail, the earlier of three (3) Business Days following such
deposit or the date of receipt as disclosed on the return receipt. Rejection
or other refusal to accept or the inability to deliver because of changed
address for which no notice was given shall be deemed to be receipt of the
Notice sent. By giving at least fifteen (15) days prior Notice thereof, the
Borrower, a Bank or Agent shall have the right from time to time and at any
time during the term of this Agreement to change their respective addresses
and each shall have the right to specify as its address any other address
within the United States of America.
Section 20. RELATIONSHIP.
The relationship between each Bank and the Borrower is solely that of a
lender and borrower, and nothing contained herein or in any of the other Loan
Documents shall in any manner be construed as making the parties hereto
partners, joint venturers or any other relationship other than lender and
borrower.
Section 21. GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE.
THIS AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS EXCEPT AS OTHERWISE
SPECIFICALLY PROVIDED THEREIN, ARE CONTRACTS UNDER THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SUCH COMMONWEALTH (EXCLUDING THE
LAWS APPLICABLE TO CONFLICTS OR
-73-
CHOICE OF LAW). THE BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF
THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE
COURTS OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY FEDERAL COURT SITTING
THEREIN AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND THE
SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER BY MAIL AT
THE ADDRESS SPECIFIED IN Section 19. THE BORROWER HEREBY WAIVES ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR
ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
Section 22. HEADINGS.
The captions in this Agreement are for convenience of reference only and
shall not define or limit the provisions hereof.
Section 23. COUNTERPARTS.
This Agreement and any amendment hereof may be executed in several
counterparts and by each party on a separate counterpart, each of which when so
executed and delivered shall be an original, and all of which together shall
constitute one instrument. In proving this Agreement it shall not be necessary
to produce or account for more than one such counterpart signed by the party
against whom enforcement is sought.
Section 24. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Agreement nor
any term hereof may be changed, waived, discharged or terminated, except as
provided in Section 27.
Section 25. WAIVER OF JURY TRIAL.
EACH OF THE BORROWER, THE AGENT AND THE BANKS HEREBY WAIVES ITS RIGHT TO
A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE
IN CONNECTION WITH THIS AGREEMENT, ANY NOTE OR ANY OF THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE
PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS. THE BORROWER (A) CERTIFIES THAT
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY BANK OR THE AGENT HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH BANK OR THE AGENT WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT THE
-74-
AGENT AND THE BANKS HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS TO WHICH THEY ARE PARTIES BY, AMONG OTHER THINGS, THE
WAIVER AND CERTIFICATIONS CONTAINED IN THIS Section 25.
Section 26. DEALINGS WITH THE BORROWER.
The Banks and their affiliates may accept deposits from, extend credit to
and generally engage in any kind of banking, trust or other business with the
Borrower, its Subsidiaries, the Guarantor or any of their affiliates regardless
of the capacity of the Bank hereunder.
Section 27. CONSENTS, AMENDMENTS, WAIVERS, ETC.
Except as otherwise expressly provided in this Agreement, any consent or
approval required or permitted by this Agreement may be given, and any term
of this Agreement or of any other instrument related hereto or mentioned
herein may be amended, and the performance or observance by the Borrower of
any terms of this Agreement or such other instrument 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 Majority Banks. Notwithstanding the
foregoing, none of the following may occur without the written consent of
each Bank: (a) any change in the rate of interest on and the term of the
Notes; (b) any change in the amount of the Commitments of the Banks; (c) any
forgiveness, reduction or waiver of the principal of any unpaid Loan or any
interest thereon or fee payable under the Loan Documents; (d) any change in
the amount of any fee payable to a Bank or the Agent hereunder; (e) any
postponement of any date fixed for any payment of principal of or interest on
the Loan; (f) any extension of the Maturity Date; (g) any change in the
manner of distribution of any payments to the Banks; (h) any release of the
Borrower or the Guarantor; (i) except as permitted herein or in that certain
Intercreditor Agreement, the sale, transfer or assignment of the Loan
Documents or any interest therein; (j) any written modification to or waiver
of the definition of the term "Borrowing Base" or any defined term used
within such definition; (k) any amendment of the (i) definition of Majority
Banks, (ii) any requirement for consent by all of the Banks, (iii) the
provisions of Section 14.9 regarding the appointment of the Co-Agent as
successor Agent, (iv) Section 27, or (v) any provision of this Agreement or
the Loan Documents which requires the approval of the Majority Banks to
require a lesser number of Banks to approve such action; and (l) approval of
the terms relating to the Debentures. The amount of the Agent's fee payable
for the Agent's account and the provisions of Section 14 may not be amended
without the written consent of the Agent. No waiver shall extend to or
affect any obligation not expressly waived or impair any right consequent
thereon. No course of dealing or delay or omission on the part of the Agent
or any Bank in exercising any right shall operate as a waiver thereof or
otherwise be prejudicial thereto. 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 28. SEVERABILITY.
-75-
The provisions of this Agreement are severable, and if any one clause or
provision hereof shall be held invalid or unenforceable in whole or in part in
any jurisdiction, then such invalidity or unenforceability shall affect only
such clause or provision, or part thereof, in such jurisdiction, and shall not
in any manner affect such clause or provision in any other jurisdiction, or any
other clause or provision of this Agreement in any jurisdiction.
Section 29. NO UNWRITTEN AGREEMENTS.
THE WRITTEN LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
Section 30. TIME OF THE ESSENCE.
Time is of the essence with respect to each and every covenant, agreement
and obligation of the Borrower under this Agreement and the other Loan
Documents.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as a
sealed instrument as of the date first set forth above.
MERIDIAN INDUSTRIAL TRUST, INC.,
a Maryland corporation
By: /S/ XXXXXX X. XXXXXX [SEAL]
---------------------------
Title: President
-76-
THE FIRST NATIONAL BANK OF
BOSTON, individually and as Agent
By: /S/ XXXXX XXXXX
---------------------------
Title: Vice President
-77-
TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
individually and as Co-Agent
By: ____________________________________
Its: ______________________________
Texas Commerce Bank National
Association
717 Xxxxxx, 7th Floor- South
Real Estate Department
Houston, Texas 7702
Attn: Xxxxxxxxx X. Xxxxxx,
Senior Vice President
(000) 000-0000
(000) 000-0000 (FAX)
-00-
XXXXXXXXXXX XX XXXXX, N.A.
By: XXXXX X.X. XXXXXX
--------------------------
Its: VICE PRESIDENT
---------------------
NationsBank of Texas, N.A.
Real Estate Banking Group
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000-0000
Attn: Xxxxx Xxxxxx, Vice President
(000) 000-0000
(000) 000-0000 (FAX)
-79-
EXHIBIT A
FORM OF AMENDED AND RESTATED NOTE
$25,000,000.00 March __, 1996
FOR VALUE RECEIVED, the undersigned MERIDIAN INDUSTRIAL TRUST, INC., a
Maryland corporation, hereby promises to pay to ______________________________
or order, in accordance with the terms of that certain First Amended and
Restated Revolving Credit Agreement dated March ___, 1996 (the "Credit
Agreement"), as from time to time in effect, among the undersigned, The First
National Bank of Boston, for itself and as Agent, and such other Banks as may
be from time to time named therein, to the extent not sooner paid, on or
before the Maturity Date the principal sum of Twenty-Five Million and No/100
Dollars ($25,000,000.00), or such amount as may be advanced by the payee
hereof under the Credit Agreement with daily interest from the date hereof,
computed as provided in the Credit Agreement, on the principal amount hereof
from time to time unpaid, at a rate per annum on each portion of the
principal amount which shall at all times be equal to the rate of interest
applicable to such portion in accordance with the Credit Agreement, and with
interest on overdue principal and, to the extent permitted by applicable law,
on overdue installments of interest and late charges at the rates provided in
the Credit Agreement. Interest shall be payable on the dates specified in
the Credit Agreement, except that all accrued interest shall be paid at the
stated or accelerated maturity hereof or upon the prepayment in full hereof.
Capitalized terms used herein and not otherwise defined herein shall have the
meanings set forth in the Credit Agreement.
Payments hereunder shall be made to The First National Bank of Boston, as
Agent for the payee hereof, 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000.
This Note is one of one or more Notes evidencing borrowings under and is
entitled to the benefits and subject to the provisions of the Credit Agreement.
The principal of this Note may be due and payable in whole or in part prior to
the maturity date stated above and is subject to mandatory prepayment in the
amounts and under the circumstances set forth in the Credit Agreement, and may
be prepaid in whole or from time to time in part, all as set forth in the Credit
Agreement.
Notwithstanding anything in this Note to the contrary, all agreements
between the Borrower and the Banks and the Agent, whether now existing or
hereafter arising and whether written or oral, are hereby limited so that in no
contingency, whether by reason of acceleration of the maturity of any of the
Obligations or otherwise, shall the interest contracted for, charged or received
by the Banks exceed the maximum amount permissible under applicable law. If,
from any circumstance whatsoever, interest would otherwise be payable to the
Banks in excess of the maximum lawful amount, the interest payable to the Banks
shall be reduced to the maximum amount permitted under applicable law; and if
from any circumstance the Banks shall ever
receive anything of value deemed interest by applicable law in excess of the
maximum lawful amount, an amount equal to any excessive interest shall be
applied to the reduction of the principal balance of the Obligations and to
the payment of interest or, if such excessive interest exceeds the unpaid
balance of principal of the Obligations, such excess shall be refunded to the
Borrower. All interest paid or agreed to be paid to the Banks shall, to the
extent permitted by applicable law, be amortized, prorated, allocated and
spread throughout the full period until payment in full of the principal of
the Obligations (including the period of any renewal or extension thereof) so
that the interest thereon for such full period shall not exceed the maximum
amount permitted by applicable law. This paragraph shall control all
agreements between the Borrower and the Banks and the Agent.
In case an Event of Default shall occur, the entire principal amount of
this Note may become or be declared due and payable in the manner and with
the effect provided in said Credit Agreement.
This Note shall be governed by and construed in accordance with the laws
of the Commonwealth of Massachusetts (without giving effect to the conflict
of laws rules of any jurisdiction).
The undersigned maker and all guarantors and endorsers, hereby waive
presentment, demand, notice, protest, notice of intention to accelerate the
indebtedness evidenced hereby, notice of acceleration of the indebtedness
evidenced hereby and all other demands and notices in connection with the
delivery, acceptance, performance and enforcement of this Note, except as
specifically otherwise provided in the Credit Agreement, and assent to
extensions of time of payment or forbearance or other indulgence without
notice.
This Note is a note executed in amendment and restatement of that
certain Note from the undersigned to ________________________________ dated
February 26, 1996 in the face principal amount of $16,666,666.67.
IN WITNESS WHEREOF the undersigned has by its duly authorized officers,
executed this Note under seal as of the day and year first above written.
MERIDIAN INDUSTRIAL TRUST, INC.,
a Maryland corporation
By:___________________________[SEAL]
Title:
EXHIBIT B
FORM OF REQUEST FOR LOAN
The First National Bank of Boston
000 X. Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxx, Vice President
(000) 000-0000 (FAX)
Texas Commerce Bank National Association
717 Xxxxxx, 0xx Xxxxx-Xxxxx
Xxxx Xxxxxx Xxxxxxxxxx
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxxxx X. Xxxxxx
(000) 000-0000 (FAX)
NationsBank of Texas, N.A.
Real Estate Banking Group
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000-0000
Attn: Xxxxx Xxxxxx
(000) 000-0000 (FAX)
Ladies and Gentlemen:
Pursuant to the provisions of Section 2.6 of the First Amended and
Restated Revolving Credit Agreement dated March __, 1996, as from time to
time in effect (the "Credit Agreement"), among Meridian Industrial Trust,
Inc. (the "Borrower"), The First National Bank of Boston, for itself and as
Agent and the other Banks from time to time party thereto, the Borrower
hereby requests and certifies as follows:
1. LOAN. The Borrower hereby requests a Loan under Section 2.1 of
the Credit Agreement:
Principal Amount: $_______________
Type (Eurodollar, Base Rate):
Drawdown Date: _______________ , 19___
Interest Period:
by credit to the general account of the Borrower with the Agent at the
Agent's Head Office.
2. USE OF PROCEEDS. Such Loan shall be used for the following
purposes permitted by Section 7.11 of the Credit Agreement:
[Describe]
3. NO DEFAULT. The undersigned Authorized Officer of the Borrower
certifies that the Borrower is and will be in compliance with all covenants
under the Loan Documents after giving effect to the making of the Loan
requested hereby.
4. UNENCUMBERED OPERATING PROPERTIES. The undersigned Authorized
Officer of the Borrower certifies that the Borrower is and will be in
compliance with Section 9.4 of the Credit Agreement after giving effect to
the making of the Loan requested hereby. Attached hereto as SCHEDULE A is a
list of each of the Unencumbered Operating Properties, their location, the
year in which each property was built, the Gross Rentable Area in each such
property, the Asset Value of each such property, the average occupancy for
each of the Unencumbered Operating Properties for the last two (2) fiscal
quarters and the average occupancy for such period for all of the
Unencumbered Operating Properties, the Net Operating Income and Operating
Cash Flow for each of the Unencumbered Operating Properties, and calculations
evidencing the Borrower's compliance with Section 9.4.
5. REPRESENTATIONS TRUE. Each of the representations and warranties made
by or on behalf of the Borrower and its Subsidiaries and the Guarantor contained
in the Credit Agreement, in the other Loan Documents or in any document or
instrument delivered pursuant to or in connection with the Credit Agreement was
true as of the date as of which it was made and shall also be true at and as of
the Drawdown Date for the Loan requested hereby, with the same effect as if made
at and as of such Drawdown Date (except to the extent of changes resulting from
transactions contemplated or permitted by the Credit Agreement and the other
Loan Documents and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and except to the extent
that such representations and warranties relate expressly to an earlier date)
and no Default or Event of Default has occurred and is continuing.
6. OTHER CONDITIONS. All other conditions to the making of the Loan
requested hereby set forth in Section 11 of the Credit Agreement have been
satisfied.
7. DRAWDOWN DATE. Except to the extent, if any, specified by notice
actually received by the Agent prior to the Drawdown Date specified above, the
foregoing representations and warranties shall be deemed to have been made by
the Borrower on and as of such Drawdown Date.
8. DEFINITIONS. Terms defined in the Credit Agreement are used herein
with the meanings so defined.
IN WITNESS WHEREOF, I have hereunto set my hand this _____ day of
_______________, 199__.
MERIDIAN INDUSTRIAL TRUST, INC.,
a Maryland corporation
By: ____________________________[SEAL]
Title: _____________________
The undersigned Authorized Officer of the Guarantor joins in the execution
hereof to certify that since the date of the last Compliance Certificate
delivered pursuant to the Credit Agreement, there have been no material
changes that could cause a Default or Event of Default to occur after giving
effect to the making of the Loan requested hereby.
___________________________________,
a __________________________________
By:_________________________________
Name:
Title:
[CORPORATE SEAL]
EXHIBIT C
FORM OF LETTER OF CREDIT REQUEST
The First National Bank of Boston
000 X. Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxx, Vice President
(000) 000-0000 (FAX)
Texas Commerce Bank National Association
717 Xxxxxx, 0xx Xxxxx-Xxxxx
Xxxx Xxxxxx Xxxxxxxxxx
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxxxx X. Xxxxxx
(000) 000-0000 (FAX)
NationsBank of Texas, N.A.
Real Estate Banking Group
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000-0000
Attn: Xxxxx Xxxxxx
(000) 000-0000 (FAX)
Ladies and Gentlemen:
Pursuant to the provisions of Section 2.9 of the First Amended and
Restated Revolving Credit Agreement dated March ___, 1996, as from time to
time in effect (the "Credit Agreement"), among Meridian Industrial Trust,
Inc. (the "Borrower"), the First National Bank of Boston, for itself and as
Agent and the other Banks from time to time party thereto, the Borrower
hereby requests and certifies as follows:
1. LETTER OF CREDIT. The Borrower hereby requests a Letter of Credit to
be issued under Section 2.9 of the Credit Agreement:
Principal Amount: $
Beneficiary:
2. USE OF PROCEEDS. Such Letter of Credit shall be used for the
following purposes permitted by Section 2.9 and Section 7.11 of the Credit
Agreement:
[Describe]
3. NO DEFAULT. The undersigned Authorized Officer of the Borrower
certifies that the Borrower is and will be in compliance with all covenants
under the Loan Documents after giving effect to the making of the Loan
requested hereby.
4. UNENCUMBERED OPERATING PROPERTIES. The undersigned Authorized
Officer of the Borrower certifies that the Borrower is and will be in
compliance with Section 9.4 of the Credit Agreement after giving effect to the
making of the Loan requested hereby. Attached hereto as SCHEDULE A is a list
of each of the Unencumbered Operating Properties, their location, the year in
which each property was built, the Gross Rentable Area in each such property,
the Asset Value of each such property, the average occupancy for each of the
Unencumbered Operating Properties for the last two (2) fiscal quarters and
the average occupancy for such period for all of the Unencumbered Operating
Properties, the Net Operating Income and Operating Cash Flow for each of the
Unencumbered Operating Properties, and calculations evidencing the Borrower's
compliance with Section 9.4.
5. REPRESENTATIONS TRUE. Each of the representations and warranties
made by or on behalf of the Borrower and its Subsidiaries and the Guarantor
contained in the Credit Agreement, in the other Loan Documents or in any
document or instrument delivered pursuant to or in connection with the Credit
Agreement was true as of the date as of which it was made and shall also be
true at and as of the Drawdown Date for the Loan requested hereby, with the
same effect as if made at and as of such Drawdown Date (except to the extent
of changes resulting from transactions contemplated or permitted by the
Credit Agreement and the other Loan Documents and changes occurring in the
ordinary course of business that singly or in the aggregate are not
materially adverse, and except to the extent that such representations and
warranties relate expressly to an earlier date) and no Default or Event of
Default has occurred and is continuing.
6. OTHER CONDITIONS. All other conditions to the making of the Loan
requested hereby set forth in Section 11 of the Credit Agreement have been
satisfied.
7. DRAWDOWN DATE. Except to the extent, if any, specified by notice
actually received by the Agent prior to the Drawdown Date specified above,
the foregoing representations and warranties shall be deemed to have been
made by the Borrower on and as of such Drawdown Date.
8. DEFINITIONS. Terms defined in the Credit Agreement are used herein
with the meanings so defined.
IN WITNESS WHEREOF, I have hereunto set my hand this _____ day of
_______________, 199__.
MERIDIAN INDUSTRIAL TRUST, INC., a Maryland corporation
By: ________________________________[SEAL]
Title: ________________________________
The undersigned Authorized Officer of the Guarantor joins in the execution
hereof to certify that since the date of the last Compliance Certificate
delivered pursuant to the Credit Agreement, there have been no material
changes that could cause a Default or Event of Default to occur after giving
effect to the making of the Loan requested hereby.
___________________________________,
a _________________________________
By: _________________________________
Name:
Title:
[CORPORATE SEAL]
EXHIBIT D
FORM OF
COMPLIANCE CERTIFICATE
The First National Bank of Boston,
for itself and as Agent
000 X. Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxx
(000) 000-0000 (FAX)
Texas Commerce Bank National Association
717 Xxxxxx, 0xx Xxxxx-Xxxxx
Xxxx Xxxxxx Xxxxxxxxxx
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxxxx X. Xxxxxx
(000) 000-0000 (FAX)
NationsBank of Texas, N.A.
Real Estate Banking Group
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000-0000
Attn: Xxxxx Xxxxxx
(000) 000-0000 (FAX)
Ladies and Gentlemen:
Reference is made to the First Amended and Restated Revolving Credit
Agreement dated March __, 1996 (the "Credit Agreement") by and among Meridian
Industrial Trust, Inc. (the "Borrower"), The First National Bank of Boston,
for itself and as Agent, and the other Banks from time to time party thereto.
Terms defined in the Credit Agreement and not otherwise defined herein are
used herein as defined in the Credit Agreement.
Pursuant to the Credit Agreement, the Borrower and the Guarantor are
furnishing to you herewith (or has most recently furnished to you) the
financial statements of the Borrower and its Subsidiaries and the Guarantor
for the fiscal period ended _______________, 199__ (the "Balance Sheet
Date"). Such financial statements have been prepared in accordance with
generally accepted accounting principles and present fairly the financial
position of the Borrower and its Subsidiaries and the Guarantor covered
thereby at the date thereof and the results of their operations for the
periods covered thereby, subject in the case of interim statements only to
normal year-end audit adjustments.
This certificate is submitted in compliance with requirements of Section
7.4(e), Section 7.5(d) and Section 10.10 of the Credit Agreement. If this
certificate is provided under a provision other than Section 7.4(e), the
calculations provided below are made using the financial statements of the
Borrower and its Subsidiaries and the Guarantor as of the Balance Sheet Date
adjusted in the best good-faith estimate of the Borrower and the Guarantor to
give effect to the making of a Loan, extension of the Maturity Date,
acquisition or disposition of property or other event that occasions the
preparation of this certificate; and the nature of such event and the
Borrower's and the Guarantor's estimate of its effects are set forth in
reasonable detail in an attachment hereto. The undersigned officers of the
Borrower and the Guarantor are Authorized Officers of the Borrower and the
Guarantor .
The undersigned Authorized Officers have caused the provisions of the
Credit Agreement and the Guaranty to be reviewed and have no knowledge of any
Default or Event of Default. (Note: If the signer does have knowledge of any
Default or Event of Default, the form of certificate should be revised to
specify the Default or Event of Default, the nature thereof and the actions
taken, being taken or proposed to be taken by the Borrower and the Guarantor
with respect thereto.)
The Borrower and the Guarantor are providing the following information to
demonstrate compliance as of the date hereof with the following covenants (to
the extent the Certificate requests a ratio for the previous three quarters and
three quarters have not elapsed since the Closing Date, the Borrower should
specify only such ratios as are then available):
1. Section 7.5(d). TRANSFERS AND ENCUMBRANCES.
Describe sales, encumbrances, refinances
and other transfers referred to in Section 7.5(d).
2. Section 7.15. UNENCUMBERED OPERATING PROPERTIES.
A. Value of Industrial Properties
1. Total Asset Value of
Unencumbered Operating
Properties constituting
industrial properties $___________
2. Total Asset Value of all
Unencumbered Operating
Properties (after one-time
market adjustment of $______) $___________
Ratio of A.1 to A.2 ___________%
(shall be at least 70%;
75% after the first anniversary
of the Closing Date)
Ratio for previous three
quarters
__________, __________, __________
B. Geographic Distribution
1. Attach schedules for each
metropolitan area showing
total Asset Value for each
such area $___________
2. Total Asset Value of
all Unencumbered Operating
Properties (after one-time
market adjustment) $___________
Ratio of B.1 to B.2 ___________%
(shall not exceed 20%;
30% for Memphis, Tenn.)
Ratio for previous three
quarters
__________, __________, ___________
C. Leases
1. Economic Leases
(a) Total Gross Rentable Area
of Unencumbered Operating
Properties subject to Leases
paying rent __________
(b) Total Gross Rentable Area
of Unencumbered Operating
Properties __________
Ratio of C.1(a) to C.1(b) _________%
(shall be at least 85%)
Ratio for previous three quarters
__________, __________, ___________
2. All Leases
(a) Total Gross Rentable Area
of Unencumbered Operating
Properties subject to Leases
in which tenants are in occupancy __________
(b) Total Gross Rentable Area
of Unencumbered Operating
Properties __________
Ratio of C.2(a) to C.2(b) _________%
(shall be at least 77%)
Ratio for previous three quarters
__________, __________, __________
3. Tenants
(a) Total Gross Cash Receipts
generated by Unencumbered
Operating Properties $__________
(b) Does any single tenant
account for more than 7% of
C.3(a) (10% if S&P rating of
BBB- or better)? __________
List top five tenant with respect to
Gross Cash Receipts
3. Section 8.1(f). NON-RECOURSE INDEBTEDNESS.
A. Amount of Non-recourse Indebtedness
pursuant to Section 8.1(f) $____________
Amount may not exceed $20,000,000
The amount for the previous
three quarters __________, __________, __________
4. Section 8.7. DISTRIBUTIONS.
A. Amount of Distributions for
Quarter most recently ended $____________
B. Funds from Operations for
Quarter most recently ended $____________
C. Cash Available for Distribution for
Quarter most recently ended $____________
D. Minimum Distributions required
to maintain REIT status of the
Borrower $___________
E. A is _______% of B
For the first quarter in which this
Compliance Certificate is submitted,
A may not exceed the greater of
(i) 95% of B or (ii) D; thereafter,
A may not exceed the greater of (i)
85% of B or (ii) D.
F. A is ____% of C
In 1996, A may not exceed the greater of
(a) 110% of C or (b) D; thereafter, A may
not exceed the greater of (a) 100% of C
or (b) D.
5. Section 9.1. LIABILITIES TO TANGIBLE NET WORTH RATIO.
A. Consolidated Total Liabilities
per balance sheet $____________
B. Consolidated Tangible Net Worth $____________
Ratio of A to B ____________
Ratio of A to B may not exceed 0.75 to 1.
The ratio of A to B for the
previous three quarters __________, __________, __________
6. Section 9.2. DEBT COVERAGE.
A. Funds from Operations
Consolidated Net Income for
most recent quarter $____________
Plus depreciation and amortization $____________
Plus expensed interest $____________
Plus amortized portion of $____________
Initial Loan Fees
Subtotal for most recent quarter $___________
Funds from Operations
for three prior quarters:
Quarter ended __________ $___________
Quarter ended __________ $___________
Quarter ended __________ $___________
Total $___________
B. Debt Service for four prior
quarters
Principal Paid $___________
Interest Paid $___________
Total $___________
A divided by B (expressed as a percentage) __________%
A must equal or exceed 250% of B.
Coverage for previous
three quarters __________, __________, __________
7. Section 9.3. FIXED CHARGE COVERAGE.
A. Cash Available for Distribution
Funds from Operations for
quarter ending ________ $__________
Minus Capital Improvement Reserve $__________
($0.15 x Total Gross Rentable Area)
Minus actual tenant improvements and
leasing commissions
(attach itemization) $__________
Plus expensed interest $__________
Subtotal for most recent quarter $__________
Cash Available for Distribution
for three prior quarters:
Quarter ended __________ $__________
Quarter ended __________ $__________
Quarter ended __________ $__________
Total $__________
B. Debt Service for four prior
quarters
Principal Paid $__________
Interest Paid $__________
Total $__________
A divided by B (expressed as a percentage)
A must equal or exceed 175% of total of B.
8. Section 9.4. BORROWING BASE. (Attach separate
worksheet for
each Unencumbered Operating
Property)
A. Aggregate of all Borrowing Bases
(per attached worksheet) $__________
B. Total Outstanding principal
balance of Loans (after giving
effect to any Loan Request) and
Outstanding Letters of Credit $__________
B may not exceed A.
9. Section 9.5. TANGIBLE NET WORTH
Consolidated Tangible Net Worth
A. Consolidated Total Assets per
balance sheet $__________
One-time market adjustment $__________
Consolidated Total Assets after
one-time market adjustment $__________
Minus Consolidated Total
Liabilities per balance sheet $__________
Minus aggregate book value of
intangible assets $__________
Minus asset write-up amounts,
if any $__________
Total $__________
Consolidated Tangible Net Worth may not be less
than $155,000,000.00 plus the amount of any net
proceeds received from any Equity Offering subsequent
to March 1, 1996.
10. REAL ESTATE ASSETS
A. Section 9.6(A). Partnerships/Joint Ventures
1. Total Asset Value of Borrower's
partnership and joint venture
interests (excluding Subsidiaries
that are 100% owned, directly or
indirectly by Borrower) $__________
2. Total Asset Value of all
Unencumbered Operating Properties
(after one-time market adjustment
of $____________) $__________
A.1 may not exceed 10% of A.2
B. Section 9.7(B). Land
1. Total Asset Value of Borrower's
non-income producing land assets $__________
2. Total Asset Value of all Unencumbered
Operating Properties (after one-time
market adjustment) $__________
B.1 may not exceed 3% of B.2
C. Section 8.9. Development
1. Total Asset Value of Borrower's
Real Estate under development $__________
2. Total Asset Value of all Unencumbered
Operating Properties (after one-time
market adjustment of $____________) $__________
C.1 may not exceed 10% of C.2
IN WITNESS WHEREOF, we have hereunto set our hands this ___ day of
_______________________, 199__.
MERIDIAN INDUSTRIAL TRUST, INC., a Maryland corporation
By: ________________________________[SEAL]
Title: ________________________________
DFW NINE, A CALIFORNIA LIMITED PARTNERSHIP,
a California limited partnership
By:______________________________,
a California corporation
By:_______________________________
Title:_______________________________
[CORPORATE SEAL]
BORROWING BASE WORKSHEET
Prepare spread sheet showing following information for all Unencumbered
Operating Properties:
A. Asset Value
1. Asset Value of Unencumbered
Operating Property
2. 50% of (1)
B. Net Operating Income
1. Gross Cash Receipts
(a) Gross Cash Receipts of
Unencumbered Operating
Property for quarter
ending ________
[Attach worksheet in form
and substance satisfactory
to the Agent]
(b) Gross Cash Receipts of
Unencumbered Operating
Property for prior quarters:
Quarter ended __________
Quarter ended __________
Quarter ended __________
Total Gross Cash Receipts
2. Operating Expenses
(a) Operating Expenses of Unencumbered
Operating Property for quarter
ending __________
(b) Operating Expenses of Unencumbered
Operating Property for prior
quarters
Quarter ended ___________
Quarter ended ___________
Quarter ended ___________
3. Net Operating Income
(a) Total Gross Cash Receipts minus
Total Operating Expenses
(b) Capital Improvement Reserve of
$0.15 multiplied by Gross Rentable
Area of Unencumbered Operating
Property
Total Net Operating Income equals
3(a) minus 3(b)
4. Divide total on line 3 by 10.5%
if Initial Unencumbered Operating
Property or after acquired Unencumbered
Operating Property which does not
constitute a Qualifying Property (see 5)
5. Divide total on line 3 by 9.75% if
Qualifying Property
Test for Qualifying Property
(a) Age
(Must not exceed 12 years)
(b) Gross Rentable Area
(Must not be less than 50,000 s.f.)
(c) Use
(Must be non-specialized)
2
(d) Must meet 2 of the following 3
requirements
(1) s.f. of finished out air
conditioned office space
(Must not exceed 20% of
total Gross Rentable Area)
(2) ceiling clearance height
(must not be less than 22 feet)
(3) average Gross Rentable Area
covered by each Lease (must
not be less than 20,000 s.f.)
C. Debt Service Test
1. Gross Cash Receipts (See B.1. above)
2. Operating Expenses (See B.2 above)
3. Net Operating Income (See B.3 above)
4. Divide total on line 3 by 1.75
5. Divide total on line 4 by 12
6. Constant based on 10 year Treasury
Obligations (yield supplied by Agent)
+ 2.0% and 25 year mortgage style
amortization
7. Total on line 5 divided by constant
on line 6, which total is
multiplied by 12, equals Debt Service
Coverage Amount
D. Lesser of A, B and C is the Borrowing Base for
an Unencumbered Operating Property
3
SCHEDULE 1
BANKS AND COMMITMENTS
NAME AND ADDRESS COMMITMENT COMMITMENT PERCENTAGE
---------------- ---------- ---------------------
The First National Bank of $25,000,000.00 33.333%
Boston
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn.: Real Estate Division
Eurodollar Lending Office
Same as above
Texas Commerce Bank $25,000,000.00 33.333%
National Association
717 Xxxxxx, 7th Floor-South
Real Estate Department
Xxxxxxx, Xxxxx 00000
Attn.: Xxxxxxxxx X. Xxxxxx,
Senior Vice President
Eurodollar Lending Office
Same as above
NationsBank of Texas, N.A. $25,000,000.00 33.333%
Real Estate Banking Group
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000-0000
Attn.: Xxxxx Xxxxxx
Eurodollar Lending Office
Same as above
______________
Total Commitment $75,000,000.00
Commitment Percentages may not equal 100% due to rounding.
SCHEDULE 2
INITIAL UNENCUMBERED OPERATING PROPERTIES
NAME OWNER
------------------------- -------------------------
4000 Air Park Cove Guarantor
Airport Building #3 Guarantor
Airport Building #14 Guarantor
Airport Building #16A Guarantor
Airport Building #16B Guarantor
Airport Building #17 Guarantor
El Dorado/Xxxxxx Borrower
Chatsworth Borrower
Scripps Ranch Borrower
Bedford Park Guarantor
Palisades I & II Guarantor
Northgate 4 & 5 Guarantor
Northgate 28 Guarantor
Las Colinas 4 & 5 Guarantor
Valley Branch I & II Guarantor
Beltline Guarantor
Great Southwest 4 Guarantor
Olive Branch (expansion) Borrower
1550 Xxxx Quaker Guarantor
0000 Xxxxxxxxx Xxxxx Xxxxxxxxx
Xxxxxxxxx Warehouse Guarantor
4013 Premier Guarantor
Live Oak Parkway Borrower
Park Ten Center Borrower
4030 Phoenix Plaza Borrower
Phoenix Deer Valley Borrower
Phoenix N. 23rd Borrower
Phoenix N. 27th Borrower
Phoenix Plaza One Borrower
Phoenix Plaza Two Borrower
Phoenix Plaza Three Borrower
Phoenix X. Xxxxxx Borrower
Phoenix W. Fairmont Borrower
Cypress B Borrower
Moorpark Borrower
Golden Cove Borrower
Xxxxx Xxxxx Two Borrower
North Irvine Borrower
Regal Empress Guarantor
Las Colinas I Guarantor
San Xxxxxx Borrower
Meridian Village Borrower
SCHEDULE 3
ADJUSTED ASSET VALUE OF REAL ESTATE
SUMMARY OF MARKET AND BOOK VALUES
PRELIMINARY
MARKET BOOK
PROPERTY CITY STATE VALUE VALUE ADJUSTMENT % VAR
-----------------------------------------------------------------------------------------------
UNSECURED
Beltline Carrollton TX 1,938,673 1,617,016 321,657 16.6%
Great Xxxxxxxxx 0 Xxxxxxxxx XX 1,850,865 1,543,777 307,088 16.6%
Las Colinas 1 Irving TX 947,757 790,509 157,248 16.6%
Las Colinas 4 & 5 Irving TX 2,339,746 1,951,544 388,202 16.6%
Xxxxxxxxx 00 Xxxxxx XX 1,115,582 930,489 185,093 16.6%
Xxxxxxxxx 0 & 0 Xxxxxx XX 1,983,176 1,654,135 329,041 16.6%
Palisades I & II Plano TX 2,806,973 2,341,251 465,722 16.6%
Regal Empress Dallas TX 2,095,450 1,747,781 347,669 16.6%
Valley Branch I & II Farmers Branch TX 2,340,401 1,952,091 388,310 16.6%
Total Dallas 17,418,623 14,528,593 2,890,030 16.6%
---------------------------------------
Live Oak Parkway Norcross GA 4,165,000 3,473,959 691,041 16.6%
0000 Xxx Xxxx Xxxx Xxxxxxx XX 1,886,000 1,573,082 312,918 16.6%
0000 Xxxxxxx Xxxxxxx XX 2,071,000 1,727,388 343,612 16.6%
Xxxxxxx Xxxxxxxx #00 Xxxxxxx XX 2,907,000 2,616,048 290,952 10.0%
Xxxxxxx Xxxxxxxx #00X Xxxxxxx XX 1,541,797 1,387,483 154,314 10.0%
Xxxxxxx Xxxxxxxx #00X Xxxxxxx XX 493,000 443,657 49,343 10.0%
Xxxxxxx Xxxxxxxx #00 Xxxxxxx XX 2,281,325 2,052,994 228,331 10.0%
Xxxxxxx Xxxxxxxx #0 Xxxxxxx XX 1,120,000 1,007,903 112,097 10.0%
Olive Branch Olive Branch MS 8,500,000 6,700,000 1,800,000 21.2%
(expansion)
1550 Xxxx Quaker La Vergne TN 4,150,000 3,461,448 688,552 16.6%
0000 Xxxxxxxxx Xxxxx Xx Xxxxxx XX 1,700,000 1,417,943 282,057 16.6%
Xxxxxxxx Warehouse La Vergne TN 1,680,000 1,401,261 278,739 16.6%
Total Mid South 32,495,122 27,263,166 5,231,956 16.1%
---------------------------------------
Bedford Park Bedford IL 3,615,000 3,015,213 599,787 16.6%
Total Midwest 3,615,000 3,015,213 599,787 16.6%
---------------------------------------
Xxxxxxxx Xxxxxxx Xxxxxxxxxx XX 7,500,000 6,255,629 1,244,371 16.6%
San Xxxxxx San Carlos CA 9,264,879 7,727,686 1,537,193 16.6%
Total Northwest 16,764,879 13,983,315 2,781,564 16.6%
---------------------------------------
0000 Xxxxxxx Xxxxx Xxxxxxx XX 156,328 130,391 25,937 16.6%
El Dorado/Roeser Phoenix AZ 2,476,525 2,228,658 247,867 10.0%
Park Ten Center Chandler AZ 1,209,888 1,009,148 200,740 16.6%
Xxxxxxx Xxxx Xxxxxx Xxxxxxx XX 374,858 312,663 62,195 16.6%
Phoenix N. 23rd Phoenix AZ 677,240 564,875 112,365 16.6%
Phoenix X. 00xx Xxxxxxx XX 1,006,540 839,539 167,001 16.6%
Xxxxxxx Xxxxx Xxx Xxxxxxx XX 918,000 765,689 152,311 16.6%
Phoenix Plaza Three Phoenix AZ 1,891,000 1,577,253 313,747 16.6%
Xxxxxxx Xxxxx Xxx Xxxxxxx XX 1,168,000 974,210 193,790 16.6%
Phoenix W. Fairmont Phoenix AZ 250,000 208,521 41,479 16.6%
Phoenix X. Xxxxxx Phoenix AZ 55,557 46,339 9,218 16.6%
Total Phoenix 10,183,936 8,657,286 1,526,650 15.0%
---------------------------------------
Xxxxxxxxxx Xxxxxxxxxx XX 3,000,000 2,502,252 497,748 16.6%
Cypress B Cypress CA 3,500,000 2,919,294 580,706 16.6%
Golden Cove Palos Verdes CA 5,291,216 4,761,635 529,581 10.0%
Xxxxxxxx Xxxxxxxx XX 5,064,813 4,224,479 840,334 16.6%
Xxxxx Xxxxx Two San Diego CA 328,595 274,076 54,519 16.6%
North Irvine Santa Ana CA 2,902,507 2,612,004 290,503 10.0%
Scripps Ranch San Diego CA 10,124,996 9,111,617 1,013,379 10.0%
---------------------------------------
Total Southern California 30,212,127 26,405,357 3,806,770 12.6%
---------------------------------------
Total Unsecured 110,689,687 93,852,930 16,836,757 15.2%
---------------------------------------
PRUDENTIAL
Centreport 17 Fort Worth TX 2,147,569 1,791,253 356,316 16.6%
Great Xxxxxxxxx 000 Xxxxxxxxx XX 3,320,682 2,769,727 550,955 16.6%
Northgate International Garland TX 8,536,000 7,119,740 1,416,260 16.6%
Xxxxx Xxx 000 Xxxxxx XX 1,400,000 1,167,717 232,283 16.6%
Valwood 20 Farmers Branch TX 3,637,067 3,033,619 603,448 16.6%
Wildwood/Pioneer Irving TX 5,665,000 4,725,085 939,915 16.6%
Total Dallas 24,706,318 20,607,141 4,099,177 16.6%
---------------------------------------
Xxxxxxxx Xxxxx Xxx Xxxxxxxx XX 22,242,000 18,551,694 3,690,306 16.6%
Birmingham I Birmingham AL 1,752,000 1,461,315 290,685 16.6%
Birmingham II Birmingham AL 1,620,000 1,351,216 268,784 16.6%
0000 Xxxxxxxx Xxxxxxx XX 639,000 532,980 106,020 16.6%
Progress I & II Huntsville AL 3,672,000 3,062,756 609,244 16.6%
Xxxxxx Little Rock AR 1,500,000 1,251,126 248,874 16.6%
Port Distribution Little Rock AR 3,670,000 3,061,088 608,912 16.6%
Xxxx Distribution Memphis TN 8,100,000 6,756,080 1,343,920 16.6%
Olive Branch Olive Branch MS 11,520,000 9,608,647 1,911,353 16.6%
Willow Lake Memphis TN 4,661,000 3,887,665 773,335 16.6%
Total Mid South 59,376,000 49,524,567 9,851,433 16.6%
---------------------------------------
1000 Xxxx Elk Grove IL 2,915,000 2,431,355 483,645 16.6%
0000 Xxxxx Xxx Xxxxx XX 737,000 614,720 122,280 16.6%
0000 Xxxxx Xxx Xxxxx XX 1,027,000 856,604 170,396 16.6%
0000 Xxxxx Xxx Xxxxx XX 633,000 527,975 105,025 16.6%
0000 Xxxxx Xxx Xxxxx XX 469,000 391,185 77,815 16.6%
00000 Xxxxxxx Xxxxx Xxxxxxx XX 2,101,000 1,752,410 348,590 16.6%
00000 Xxxxxxx Xxxxx Xxxxxxx XX 1,974,000 1,646,482 327,518 16.6%
0000 Xxxxxxxxx Xxx Xxxxx XX 2,039,000 1,700,697 338,303 16.6%
0000 Xxxxx Xxx Xxx Xxxxx Xxxxxxx XX 1,339,000 1,116,838 222,162 16.6%
0000 Xxxx Xxxx Xxxxxxxx XX 3,031,000 2,528,108 502,892 16.6%
0000 X. 000xx Xxxxxx Xxxxx XX 3,100,000 2,585,660 514,340 16.6%
000 Xxxxx Xxx Xxxxx XX 2,118,000 1,766,590 351,410 16.6%
000 Xxxx Xxx Xxxxx XX 998,000 832,416 165,584 16.6%
000 Xxxxx Xxx Xxxxx XX 895,000 746,505 148,495 16.6%
Lombard I Lombard IL 6,369,000 5,312,280 1,056,720 16.6%
Pontiac Pontiac MI 3,057,000 2,549,794 507,206 16.6%
Troy Tech II Troy MI 7,804,000 6,509,191 1,294,809 16.6%
Total Midwest 40,606,000 33,868,810 6,737,190 16.6%
---------------------------------------
Park At Woodinville Woodinville WA 13,759,608 11,476,667 2,282,941 16.6%
Xxxxxx Xxxxxxx Xxxxxxx Xxx XX 10,700,000 8,924,698 1,775,302 16.6%
Total Northwest 24,459,608 20,401,365 4,058,243 16.6%
---------------------------------------
Cypress A Cypress CA 1,826,136 1,523,151 302,985 16.6%
Cypress C Cypress CA 1,897,734 1,582,869 314,865 16.6%
Xxxxxxxx Xxxxxxxx CA 5,854,526 4,883,166 971,360 16.6%
Total Southern California 9,578,396 7,989,186 1,589,210 16.6%
---------------------------------------
Total Prudential 158,726,322 132,391,069 26,335,253 16.6%
---------------------------------------
Total for All Assets 269,416,009 226,243,999 43,172,010 16.0%
---------------------------------------
---------------------------------------
SCHEDULE 6.3
TITLE TO PROPERTIES; LEASES
NONE.
SCHEDULE 6.7
LITIGATION
NONE.
SCHEDULE 6.19
SUBSIDIARIES OF THE BORROWER
THE BORROWER HAS A 100% OWNERSHIP INTEREST (DIRECTLY OR INDIRECTLY) IN THE
FOLLOWING ENTITIES:
1. DFW Nine, A California Limited Partnership, a California limited
partnership;
2. Progress Center/Alabama Limited Partnership, a California limited
partnership;
3. 6834 Limited Partnership, an Illinois limited partnership (to be
dissolved after consolidation);
4. IndTennCo Limited Partnership, a California limited partnership
(to be merged into (2) and dissolved after consolidation);
5. Metro- Sierra Limited Partnership, a California limited partnership
(to be merged into (2) and dissolved after consolidation);
6. Dallas Nine Corp., a Nevada corporation (to be merged into (8) after
consolidation);
7. Metroplex Co., a Nevada corporation (to be merged into (8) after
consolidation);
8. Metroplex Co., a California corporation (general partner of (1) after
consolidation);
9. 6834 Corporation, an Illinois corporation (general partner of (3); to
be dissolved after consolidation);
10. Mem-Ind Corporation, a Nevada corporation (general partner of (4); to
be dissolved after consolidation);
11. Texmet Corporation, a California corporation (general partner of (5);
to be dissolved after consolidation); and
12. Pro-Sierra Corporation, a California corporation (general partner
of (2)).
THE BORROWER'S OWNERSHIP IN THE FOLLOWING ENTITIES IS AS SHOWN:
1. Sierra Capital/Cherry Hill Associates, Ltd., a California limited
partnership (a dormant shell); 75% general partner interest;
2. Sierra Capital/Greentree Limited Partnership, a California limited
partnership (a dormant shell); 99% general partner interest;
and
3. Sierra Ridglea Associates, Ltd., a Texas limited partnership (a dormant
shell); Borrower - 70% limited partner interest; Guarantor - 5% general
partner interest.
