TERM CREDIT AGREEMENT
THIS CREDIT AGREEMENT (the "Credit Agreement"), dated as of October 15,
1998, is by and among HEALTHCARE REALTY TRUST INCORPORATED, a Maryland
corporation, CAPSTONE CAPITAL CORPORATION, a Maryland corporation, the banks
listed on the signature pages hereof, and NATIONSBANK, N.A., as administrative
agent for such banks.
The parties hereto agree as follows:
ARTICLE I
DEFINITION
SECTION 1.01 Definitions. The following terms, as used herein, have the
following meanings:
"Adjusted Eurodollar Rate" means, for the Interest Period for
each Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate
determined pursuant to the following formula:
Adjusted Eurodollar Rate = Interbank Offered Rate
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1 - Eurodollar Reserve Percentage
"Administrative Questionnaire" means, with respect to each
Bank, an administrative questionnaire in the form prepared by the Agent
and submitted to the Agent duly completed by such Bank.
"Affiliate" means, with respect to any designated Person, (a)
any officers or directors of such Person or (b) any other Person (other
than a Subsidiary of such designated Person) that has a relationship
with the designated Person whereby either of such Persons directly or
indirectly controls or is controlled by or is under common control with
the other of such Persons. The term "control" means the possession,
directly or indirectly, of the power, whether or not exercised to
direct or cause the direction of the management or policies of any
Person, whether through ownership of voting securities, by contract or
otherwise.
"Agent" means NationsBank, in its capacity as administrative
agent for the Banks hereunder, and its successors in such capacity.
"Agent's Fee Letter" means that letter agreement dated as of
August 31, 1998 among NationsBank, N.A., NationsBanc Xxxxxxxxxx
Securities LLC and the Borrower, as amended, modified, supplemented or
replaced from time to time.
"Applicable Lending Office" means, with respect to any Bank,
(a) in the case of its Base Rate Loans, its Domestic Lending Office and
(b) in the case of its Eurodollar Loans, its Eurodollar Lending Office.
"Applicable Percentage" means for any day, the rate per annum
set forth below opposite the applicable rating for the Borrower's
senior unsecured (non-credit enhanced) long term debt then in effect,
it being understood that the Applicable Percentage for (i) Base Rate
Loans shall be the percentage set forth under the column "Base Rate
Margin", (ii) Eurodollar Loans shall be the percentage set forth under
the column "Eurodollar Margin and Letter of Credit Fee", (iii) the
Letter of Credit Fee shall be the percentage set forth under the column
"Eurodollar Margin and Letter of Credit Fee", and (iv) the Unused Fee
shall be the percentage set forth under the column "Unused Fee":
IF THERE IS NO RATING BY S&P OR XXXXX'X:
Duff & Xxxxxx Eurodollar Margin
Pricing and Fitch and Letter of Base Rate
Level Ratings Credit Fee Margin Unused Fee
----- ------- ---------- ------ ----------
I A- or above 0.750% 0% 0.1875%
II BBB+ 0.875% 0% 0.200%
III BBB 1.00% 0% 0.200%
IV BBB- 1.125% 0% 0.225%
V below BBB- 1.375% 0.25% 0.250%
or unrated
The foregoing pricing matrix shall apply only if the
Borrower's senior unsecured (non-credit enhanced) long term debt is not
rated by either S&P or Xxxxx'x. If a such a rating is provided by
either or both of S&P or Xxxxx'x, the pricing matrix which follows
shall apply.
IF A RATING IS PROVIDED BY EITHER OR BOTH OF S&P OR XXXXX'X:
S&P,
Duff & Xxxxxx Eurodollar Margin
Pricing and Fitch Xxxxx'x and Letter of Base Rate
Level Ratings Rating Credit Fee Margin Unused Fee
----- ------- ------ ---------- ------ ----------
I A- or above A3 or above 0.675% 0% 0.1875%
II BBB+ Baa1 0.800% 0% 0.200%
III BBB Baa2 0.925% 0% 0.200%
IV BBB- Baa3 1.05% 0% 0.225%
V below BBB- below Baa3 1.30% 0.25% 0.250%
The numerical classification set forth under the column
"Pricing Level" shall be established based on the ratings by S&P,
Xxxxx'x, Duff & Xxxxxx and Fitch (collectively, the "Rating Services")
for the Borrower's senior unsecured (non-credit enhanced) long term
debt.
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Notwithstanding anything to the contrary contained herein, in
the event the Tranche A Maturity Date is extended beyond the original
maturity date as provided in Section 2.04(a), the Applicable
Percentages shall be increased by twenty-five basis points (0.25%), in
each case, from the date of election of extension by HRT.
Where such a rating is provided by Duff & Xxxxxx and/or Fitch,
but not S&P or Xxxxx'x, the pricing shall be determined by reference to
the first pricing matrix shown above as hereafter provided. Where such
a rating is provided only by Duff & Xxxxxx or Fitch, but not both, the
pricing shall be determined by reference to the rating so provided.
Where such a rating is provided by Duff & Xxxxxx and Fitch, the pricing
shall be determined by reference to the lower of the two ratings if
they are not more than one Pricing Level apart, or by an average of the
applicable Pricing Levels (and applicable margins and fee percentages)
if they are more than one Pricing Level apart.
Where such a rating is provided by either or both of S&P or
Xxxxx'x, the pricing shall be determined by reference to the second
pricing matrix shown above as hereafter provided. Where such a rating
is provided only by S&P or Xxxxx'x, but not any other Ratings Service,
the pricing shall be determined by reference to such rating. Where such
a rating is provided by more than one such Ratings Service, pricing
shall be determined by reference to the lower of the two highest
ratings available, provided that at least one of the two such highest
ratings is S&P or Xxxxx'x (and the other is the highest of the other
ratings services), where the two such highest ratings are not more than
one Pricing Level apart, or by an average of the applicable Pricing
Levels (and applicable margins and fee percentages) if they are more
than one Pricing Level apart.
The Applicable Percentage shall be determined and adjusted on
the date five (5) Business Days after each change in debt rating.
Adjustments in the Applicable Percentage shall be effective as to all
Loans and Letters of Credit, existing and prospective, from the date of
adjustment. The Agent shall promptly notify the Lenders of changes in
the Applicable Percentage. Adjustments in the Applicable Percentage
shall be effective as to existing Extensions of Credit as well as new
Extensions of Credit made thereafter.
"Asset Sale" means any sale, lease or other disposition
(including any such transaction effected by way of merger, amalgamation
or consolidation) by the Borrower or any of its Subsidiaries or
Specified Affiliates subsequent to the date hereof of any asset
(including stock), including without limitation any sale-leaseback
transaction, whether or not involving a Capital Lease, but excluding
(a) any sale, lease or other disposition of real property in the
ordinary course of business of the Borrower or any of its Subsidiaries
or Specified Affiliates, (b) any sale, lease or other disposition of
raw materials, supplies or other nonfixed assets in the ordinary course
of business, (c) any sale, lease or other disposition of surplus,
obsolete or worn out machinery, equipment, molds or other manufacturing
equipment in the ordinary course of business to the extent that the
aggregate book value of all of such assets sold, leased or otherwise
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disposed of in a fiscal year does not exceed $250,000.00 (on a
non-cumulative basis), (d) any sale, lease or other disposition to the
Borrower or any Wholly-Owned Consolidated Subsidiary or Specified
Affiliate of the Borrower, (e) any sale or other disposition in the
ordinary course of business of readily marketable securities, (f) any
disposition of cash not prohibited hereunder, (g) any Securities
Transaction to the extent approved by the Majority Banks hereunder, and
(h) the issuance of any shares of stock in any Specified Affiliate to
any officer, director or employee of the Borrower.
"Assignee" shall have the meaning given to such term in
Section 9.06(c).
"Bank" means each bank listed on the signature pages hereof,
each Assignee which becomes a Bank pursuant to Section 9.06(c), and
their respective successors.
"Base Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%)
equal to the greater of (a) the Federal Funds Rate in effect on such
day plus 1/2 of 1% or (b) the Prime Rate in effect on such day. If for
any reason the Agent shall have determined (which determination shall
be conclusive absent manifest error) that it is unable after due
inquiry to ascertain the Federal Funds Rate for any reason, including
the inability or failure of the Agent to obtain sufficient quotations
in accordance with the terms hereof, the Base Rate shall be determined
without regard to clause (a) of the first sentence of this definition
until the circumstances giving rise to such inability no longer exist.
Any change in the Base Rate due to a change in the Prime Rate or the
Federal Funds Rate shall be effective on the effective date of such
change in the Prime Rate or the Federal Funds Rate, respectively.
"Base Rate Borrowing" means a Borrowing consisting of Base
Rate Loans.
"Base Rate Loan" means a Loan hereunder which bears interest
at the Base Rate plus the Applicable Percentage pursuant to the
applicable Notice of Borrowing or Notice of Interest Rate Election or
the provisions of Article VIII.
"Benefit Arrangement" means at any time an employee benefit
plan within the meaning of Section 3(3) of ERISA which is not a Plan or
a Multiemployer Plan and which is maintained or otherwise contributed
to by any member of the ERISA Group.
"Borrower" or "Borrowers" means, as to the Tranche A Term
Loan, HRT and, as to the Tranche B Term Loan, CCT.
"Borrowing" means a Term Loan borrowing hereunder, including
extensions and conversions.
"Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in Charlotte, North Carolina or New
York, New York are authorized or required by law to close.
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"Buy-Sell Agreement" means a written agreement between the
Borrower or any Subsidiary, as purchaser, and one or more third
parties, as seller, obligating the Borrower or such Subsidiary, upon
payment of a definitely determinable price, to acquire the real
property and improvements described therein without contingency, except
that the improvements are constructed in accordance with the conditions
set forth in the particular Buy-Sell Agreement.
"Capital Lease" means a lease that would be capitalized on a
balance sheet of the lessee prepared in accordance with generally
accepted accounting principles.
"Capital Lease Indebtedness" means indebtedness incurred
pursuant to a Capital Lease.
"CCT" means Capstone Capital Corporation, a Maryland
corporation, which immediately after the initial funding hereunder
shall be merged with and into HR Acquisition I Corporation, a Delaware
corporation, which shall be the surviving corporation.
"Change of Control" means the occurrence of any of the
following events: (i) any Person or two or more Persons acting in
concert shall have acquired beneficial ownership, directly or
indirectly, of, or shall have acquired by contract or otherwise, or
shall have entered into a contract or arrangement that, upon
consummation, will result in its or their acquisition of or control
over, voting stock of the HRT (or other securities convertible into
such voting stock) representing 35% or more of the combined voting
power of all voting stock of the HRT, or (ii) during any period of up
to 24 consecutive months, commencing after the Closing Date,
individuals who at the beginning of such 24 month period were directors
of the HRT (together with any new director whose election by the HRT's
Board of Directors or whose nomination for election by the HRT's
shareholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the
beginning of such period or whose election or nomination for election
was previously so approved) cease for any reason to constitute a
majority of the directors of the HRT then in office. As used herein,
"beneficial ownership" shall have the meaning provided in Rule 13d-3 of
the Securities and Exchange Commission under the Securities Exchange
Act of 1934.
"Closing Date" means the date on which the conditions set
forth in Article III to the making of the initial Extension of Credit
hereunder shall have been fulfilled and on which such initial Extension
of Credit shall have been made.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor statute.
"Commitment Percentages" means the respective Term Loan
Commitment Percentages.
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"Commitments" means the Term Loan Commitments.
"Consolidated EBIT" means, for any period, the sum of (a) the
consolidated net income of HRT and its Consolidated Subsidiaries for
such period plus (b) to the extent deducted in determining such
consolidated net income, Consolidated Interest Expense, plus (c) the
amount of any consolidated income taxes (or minus the amount of any
consolidated tax benefits) of HRT and its Consolidated Subsidiaries for
such period.
"Consolidated Funded Indebtedness" means, without duplication,
all obligations, liabilities and indebtedness of HRT and its
Subsidiaries of the types described in subsections (a) through (f),
inclusive, (i) and (j) of the definition of Debt.
"Consolidated Interest Expense" means, for any period, the
cash interest expense and letter of credit fee expense of HRT and its
Consolidated Subsidiaries determined on a consolidated basis for such
period.
"Consolidated Mortgage Debt" means the aggregate principal
amount of all Debt of HRT and its Subsidiaries secured by a Lien on any
real property owned or leased by them.
"Consolidated Senior Debt" means all Consolidated Funded
Indebtedness other than any amount thereof the repayment of which has
been subordinated to the repayment of any other Consolidated Funded
Indebtedness.
"Consolidated Senior Secured Debt" means at any date the sum
(without duplication) of (i) Consolidated Mortgage Debt plus (ii)
Consolidated Subsidiary Debt plus (iii) all preferred stock of
Subsidiaries not owned by HRT and/or one or more of its wholly-owned
Subsidiaries, valued at the higher of voluntary or involuntary
liquidation preference thereof.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which would be consolidated with those of
the Borrower in its consolidated financial statements if such
statements were prepared as of such date. For purposes of this Credit
Agreement, Specified Affiliates of the Borrower shall be classified as
Consolidated Subsidiaries.
"Consolidated Subsidiary Debt" means all Debt of Subsidiaries
of HRT (exclusive of Debt owed to the Borrower), determined in
accordance with generally accepted accounting principals on a
consolidated basis.
"Consolidated Tangible Net Worth" means, at any time,
consolidated stockholders' equity of HRT and its Consolidated
Subsidiaries determined as of such time in accordance with generally
accepted accounting principles applied on a consistent basis, with no
upward adjustments due to a revaluation of assets (other than in
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respect of assets purchased or acquired in connection with the
acquisition of CCT on or about the Closing Date), minus all Intangible
Assets.
"Consolidated Total Capital" means, at any time, the sum of
(a) Consolidated Tangible Net Worth plus (b) Consolidated Funded
Indebtedness.
"Consolidated Unencumbered Realty" means for HRT and its
Subsidiaries, the book value of all realty (prior to deduction of
accumulated depreciation) minus outstanding Consolidated Senior Secured
Debt minus the book value of all properties (prior to deduction of
accumulated depreciation) as to which associated leases or mortgage
indebtedness relating thereto is past due or otherwise in default more
than 30 days.
"Consolidated Unsecured Debt" means all unsecured Debt of the
Borrower and its Subsidiaries.
"Constitutional Documents" in relation to any corporate Person
means the Certificate of Incorporation and By-Laws or other
constitutional documents of such corporate Person.
"Credit Agreement" shall have the meaning given to such term
in the introductory paragraph hereof.
"Debt" of any Person means at any date, without duplication,
(a) all obligations of such Person for borrowed money, (b) all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments, (c) all unconditional obligations of such
Person to pay (as opposed to a contingent or conditional obligation of
such Person to pay) the deferred purchase price of property or
services, except security deposits, sums retained to secure
performance, reserves for capital improvements, trade accounts payable
and accrued expenses arising in the ordinary course of business, (d)
all Capitalized Lease Indebtedness, (e) all Debt of others secured by a
Lien on any asset of such Person, whether or not such Debt is assumed
by such Person (to the extent of the lesser of the amount of such Debt
and the book value of any assets subject to such Lien), (f) the maximum
amount of all letters of credit issued or acceptance facilities
established for the account of such Person and, without duplication,
all drafts drawn thereunder (other than letters of credit and
acceptance facilities supporting other Debt of such Person), (g)
obligations under Interest Rate Protection Agreements, (h) all
indebtedness relating to or arising from any Securities Transactions,
(i) all instruments, obligations or undertakings treated as
indebtedness in accordance with generally accepted accounting
principles, or otherwise treated as indebtedness by S&P, Xxxxx'x or any
other Ratings Service (whether or not treated as indebtedness for
purposes of generally accepted accounting principles) and (j) all Debt
of others Guaranteed by such Person (to the extent of the lesser of the
amount of such Debt Guaranteed or the amount of such Guarantee);
provided, however, Debt shall not include obligations under Buy-Sell
Agreements.
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"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or
both would, unless cured or waived, become an Event of Default.
"Defaulting Bank" means, at any time, any Bank that, at such
time, (i) has failed to make an Extension of Credit required pursuant
to the terms of this Credit Agreement, (ii) has failed to pay to the
Agent or any Bank an amount owed by such Bank pursuant to the terms of
the Credit Agreement or any other of the Credit Documents, or (iii) has
been deemed insolvent or has become subject to a bankruptcy or
insolvency proceeding or to a receiver, trustee or similar proceeding.
"Dollars" and "$" means lawful money of the United States of
America.
"Dollar Amount" means, in relation to any Debt denominated in
Dollars, the amount of such Debt.
"Domestic Lending Office" means, as to each Bank, its office
located at its address set forth in its Administrative Questionnaire
(or identified in its Administrative Questionnaire as its Domestic
Lending Office) or such other office as such Bank may hereafter
designate as its Domestic Lending office by notice to the Borrower and
the Agent.
"Duff & Xxxxxx" means Duff & Xxxxxx Credit Rating Co., Inc.,
or any successor or assignee of the business of such company in the
business of rating securities.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, regulations, ordinances, rules, judgments,
orders, decrees, permits, grants, licenses, agreements or other
governmental restrictions including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act,
the Superfund Amendments and Reauthorization Act, the Resource
Conservation and Recovery Act, the Toxic Substances Control Act, the
Clean Air Act and the Clean Water Act relating to the environment or to
emissions, discharges or releases of pollutants, contaminants,
petroleum or petroleum products, chemicals or industrial, toxic or
hazardous substances or wastes into the environment (including, without
limitation, ambient air, surface water, ground water or land) or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of pollutants,
contaminants, petroleum or petroleum products, chemicals or industrial,
toxic or hazardous substances or wastes or the clean-up or other
remediation thereof.
"ERISA" means the Employment Retirement Income Security Act of
1974, as amended, or any successor statute.
"ERISA Group" means the Borrower and all members of a
controlled group of corporations and all trades or businesses (whether
or not incorporated) under common control which, together with the
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Borrower, are treated as a single employer under Section 414 of the
Code.
"Eurodollar Borrowing" means any Borrowing consisting of
Eurodollar Loans.
"Eurodollar Business Day" means any Business Day on which the
Agent and the Eurodollar Reference Bank are open for international
business (including dealings in Dollar deposits) in London.
"Eurodollar Lending Office" means, as to each Bank, its
office, branch or affiliate located at its address set forth in its
Administrative Questionnaire (or identified in its Administrative
Questionnaire as its Eurodollar Lending Office) or such other office,
branch or affiliate of such Bank as it may hereafter designate as its
Eurodollar Lending Office by notice to the Agent.
"Eurodollar Loan" means a Loan which bears interest at the
Adjusted Eurodollar Rate plus the Applicable Percentage pursuant to the
applicable Notice of Borrowing or Notice of Interest Rate Election.
"Eurodollar Reserve Percentage" means for any day, that
percentage (expressed as a decimal) which is in effect from time to
time under Regulation D of the Board of Governors of the Federal
Reserve System (or any successor), as such regulation may be amended
from time to time or any successor regulation, as the maximum reserve
requirement (including, without limitation, any basic, supplemental,
emergency, special, or marginal reserves) applicable with respect to
Eurocurrency liabilities as that term is defined in Regulation D (or
against any other category of liabilities that includes deposits by
reference to which the interest rate of Eurodollar Loans is
determined), whether or not Lender has any Eurocurrency liabilities
subject to such reserve requirement at that time. Eurodollar Loans
shall be deemed to constitute Eurocurrency liabilities and as such
shall be deemed subject to reserve requirements without benefits of
credits for proration, exceptions or offsets that may be available from
time to time to a Bank. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the
Eurodollar Reserve Percentage.
"Event of Acceleration" means any of the events or conditions
set forth in Sections 6.01(g) or (h) with respect to the Borrower.
"Event of Default" has the meaning set forth in Section 6.01.
"Extension of Credit" means, as to any Bank, the making
(including extensions and conversions) of, or participation in, a Loan
by such Bank.
"Federal Funds Rate" means, for any day, the rate of interest
per annum (rounded upwards, if necessary, to the nearest whole multiple
of 1/100 of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System
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arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Business Day next succeeding
such day, provided that (A) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions
on the next preceding Business Day and (B) if no such rate is so
published on such next preceding Business Day, the Federal Funds Rate
for such day shall be the average rate quoted to the Agent on such day
on such transactions as determined by the Agent.
"Financing Documents" means the Credit Agreement, the Notes,
the Security Agreements and the Subsidiaries Guarantees, in each case
as amended and in effect from time to time.
"Fitch" means Fitch IBCA, Inc., or any successor or assignee
of the business of such company in the business of rating securities.
"Foreign Government" means any government other than that of
the United States of America or any political subdivision thereof.
"Foreign Person" means (a) any Foreign Government, (b) any
agency of a Foreign Government, (c) any form of business enterprise
organized under the laws of any country other than the United States of
America or its possessions or any political subdivision thereof or (d)
any form of business enterprise owned or controlled by any of the
Persons described in clauses (a), (b) or (c) of this definition.
"Funds From Operations" means the Borrower's net income
(loss), excluding gains (losses) from restructuring of indebtedness and
sales of property, plus depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures as
hereafter provided. Notwithstanding contrary treatment under generally
accepted accounting principles, for purposes hereof, "Funds From
Operations" shall include, and be adjusted to take into account, the
Borrower's interests in unconsolidated partnerships and joint ventures,
on the same basis as consolidated partnerships and subsidiaries, as
provided in the "white paper" issued in March 1995 by the National
Association of Real Estate Investment Trusts, a copy of which is
attached hereto as Schedule 5.17.
"Government" means the federal government of the United States
of America or any agency thereof.
"Governmental Authority" means any federal, state. local or
foreign court or governmental agency, authority, instrumentality o
regulatory body.
"Group" or "Group of Loans" means at any time a group of Loans
consisting of (a) all Base Rate Loans at such time or (b) all
Eurodollar Loans having the same Interest Period at such time; provided
that, if a Loan of any particular Bank is converted to or made as a
Base Rate Loan pursuant to Sections 8.02 or 8.04, such Loan shall be
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included in the same Group or Groups of Loans from time to time as if
it had not been so converted or made as a Base Rate Loan.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt
or other obligation of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of such Person (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt or
other obligation (whether by virtue of partnership arrangements, by
agreement to keep-well, to purchase assets, goods, securities or
services, to take-or-pay, or to maintain financial statement conditions
or otherwise) or (b) entered into for the purpose of assuring in any
other manner the obligee of such Debt or other obligation of the
payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part); provided that the term Guarantee shall
not include endorsement for collection or deposit in the ordinary
course of business.
"Guarantor" means any guarantor under a Subsidiaries Guarantee
"Hazardous Substance" means any toxic or hazardous substance,
including petroleum and its derivatives presently regulated under the
Environmental Laws.
"HRT" means Healthcare Realty Trust Incorporated, a Maryland
corporation, and a Borrower hereunder.
"Intangible Assets" shall mean, as of the date of any
determination thereof, the total amount of all assets of the Borrower
and its Subsidiaries consisting of goodwill patents, trade names,
trademarks, copyrights, franchises, experimental expense, organization
expense, unamortized debt discount and expense, deferred assets (other
than prepaid insurance and prepaid taxes), the excess of cost of shares
acquired over book value of related assets and such other assets as are
properly classified as "intangible assets" in accordance with generally
accepted accounting principles.
"Interbank Offered Rate" means, for the Interest Period for
each Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate
(rounded upwards, if necessary, to the nearest whole multiple of 1/100
of 1%) equal to the rate of interest, determined by the Agent on the
basis of the offered rates for deposits in dollars for a period of time
corresponding to such Interest Period (and commencing on the first day
of such Interest Period), appearing on Telerate Page 3750 (or, if, for
any reason, Telerate Page 3750 is not available, the Reuters Screen
LIBO Page) as of approximately 11:00 A.M. (London time) two (2)
Business Days before the first day of such Interest Period. As used
herein, "Telerate Page 3750" means the display designated as page 3750
by Dow Xxxxx Markets, Inc. (or such other page as may replace such page
on that service for the purpose of displaying the British Bankers
Association London interbank offered rates) and "Reuters Screen LIBO
Page" means the display designated as page "LIBO" on the Reuters
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Monitor Money Rates Service (or such other page as may replace the LIBO
page on that service for the purpose of displaying London interbank
offered rates of major banks).
"Interest Period" means, with respect to each Eurodollar Loan,
a period commencing on the date of Borrowing specified in the
applicable Notice of Borrowing or on the date specified in the
applicable Notice of Interest Rate Election and ending, one, two,
three, six or twelve months thereafter, as the Borrower may elect in
the applicable Notice; provided that:
(i) any Interest Period which would otherwise
end on a day which is not a Eurodollar Business Day shall be
extended to the next succeeding Eurodollar Business Day unless
such Eurodollar Business Day falls in another calendar month,
in which case such Interest Period shall end on the next
preceding Eurodollar Business Day;
(ii) any Interest Period which begins on the
last Eurodollar Business Day of a calendar month (or on a day
for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end
on the last Eurodollar Business Day of a calendar month; and
(iii) no Interest Period shall extend beyond any
principal amortization payment date unless the portion of the
Term Loan comprised of Base Rate Loans together with the
portion of the Term Loan comprised of Eurodollar Loans with
Interest Periods expiring prior to the date of such principal
amortization payment, is at least equal to the amount of the
principal amortization payment then due.
"Interest Rate Protection Agreement" means interest rate swap
agreement or interest rate future, option, cap, collar or other hedging
arrangements.
"Investment" means any investment in any Person, whether by
means of share purchase, capital contribution (including, without
limitation, subordinated debt), loan, time deposit, warrant, option or
otherwise.
"Investment Policy" means the Borrower's investment policy
currently in effect as of the date hereof and as previously disclosed
in writing to the Banks, and as amended from time to time by Borrower
with the approval of Majority Banks, which approval shall not be
unreasonably delayed, it being agreed and understood that in the event
Agent does not notify in writing within ten (10) days following the
date of Agent's receipt of Borrower's request for approval of an
amendment to the Investment Policy that the Majority Banks have
disapproved the requested amendment, the Majority Banks shall be deemed
to have approved the amended investment Policy.
"Liens" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect
of such asset. For the purposes of this Credit Agreement, the Borrower
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or any Subsidiary of the Borrower shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest
of a vendor or lessor under any conditional sales agreement, capital
lease or other title retention agreement relating to such asset.
"Loan" or "Loans" means the Term Loans or a Eurodollar Loan
and/or Base Rate Loan, as appropriate.
"Long-Term Debt" shall mean, at any time, any senior unsecured
debt obligations outstanding at such time with a maturity more than one
(1) year after the date of any determination hereunder.
"Majority Banks" means, at any time, Banks having more than
sixty-six and two-thirds percent (66-2/3%) of the Term Loan
Commitments, or if the Term Loan Commitments have been terminated,
Banks having more than sixty-six and two-thirds percent (66-2/3%) of
the aggregate principal amount of the Obligations outstanding (taking
into account in each case Participation Interests or the obligation to
participate therein); provided that the Commitments of, and the
outstanding principal amount of Obligations (taking into account in
each case Participation Interests or the obligation to participate
therein) owing to, a Defaulting Bank shall be excluded for purposes
hereof in making a determination of Majority Banks.
"Margin Stock" has the meaning assigned to such term in
Regulation U (to the extent applicable).
"Material Adverse Effect" means a material adverse effect on
(i) the condition (financial or otherwise), operations, business,
assets, liabilities or prospects of the Borrower and its Subsidiaries
taken as a whole, (ii) the ability of the Borrower and the other
Obligors, taken as a whole, to perform any material obligation under
the Financing Documents, or (iii) the rights and remedies of the Agent
and the Banks under the Financing Documents.
"Material Plan" means a Plan or Plans having aggregate
Unfunded Liabilities in excess of $1,000,000.
"Material Subsidiaries" means (i) as to HRT, the Subsidiaries
of HRT identified on Schedule 4.07 attached hereto and any Subsidiary
of HRT which subsequent to the Closing Date owns assets (including
stock) having an aggregate market value in excess of $2,500,000, and
(ii) as to CCT, the Subsidiaries of CCT identified on Schedule 4.07
attached hereto and any Subsidiary of CCT which subsequent to the
Closing Date owns assets (including stock) having an aggregate market
value in excess of $2,500,000.
"Moody's" means Xxxxx'x Investors Service, Inc., or any
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successor or assignee of the business of such company in the business
of rating securities.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which
any member of the ERISA Group is then making or accruing an obligation
to make contributions or has within the preceding five (5) plan years
made contributions, including for these purposes any Person which
ceased to be a member of the ERISA Group during such five (5) year
period.
"NationsBank" means NationsBank, N.A., a national banking
association, and its successors.
"Net Sale Proceeds" means, with respect to any Asset Sale, (a)
the cash proceeds received by the Borrower or any of its Subsidiaries,
minus (b) the sum of (i) fees and expenses incurred by the Borrower or
such Subsidiary in connection with such Asset Sale, (ii) cash or
incremental taxes payable by the Borrower or such Subsidiary as a
result of and in connection with such Asset Sale, (iii) any Debt
secured by a Lien on any assets subject to such Asset Sale and required
or permitted to be repaid in connection with such Asset Sale, (iv) any
portion of such proceeds payable to any holder (other than the Borrower
or any of its Subsidiaries or any of its Affiliates) of any direct or
indirect minority interest in such assets, and (v) any portion of such
net proceeds required by the Code to be paid to shareholders to
maintain the Borrower's REIT status.
"NMS" means NationsBanc Xxxxxxxxxx Securities LLC, and its
successors and assigns.
"Note" or "Notes" means any of the Term Notes.
"Notice of Borrowing" has the meaning given to such term in
Section 2.02(a).
"Notice of Interest Rate Election" has the meaning given to
such term in Section 2.10(a).
"Obligations" means, collectively, the Term Loans.
"Obligor" means the Borrower and any of the Guarantors, and
their respective successors.
"Parent" means, with respect to any Bank, any Person as to
which such Bank is a Subsidiary.
"Participant" means a bank or other institution which assumes,
in accordance with Section 9.06(b), a participating interest with
respect to the Loans, the Notes and this Credit Agreement.
"Participation Interest" means the purchase by a Bank of a
participation in the Term Loans as provided in Section 9.04.
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"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual a corporation, a partnership, a
limited liability company, an association, a trust or any other entity
or organization, including a government or political subdivision or an
agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan as
defined in Subsection 3(2) of ERISA (other than a Multiemployer Plan)
which is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code and either (a) is maintained,
or contributed to, by any member of the ERISA Group for employees of
any member of the ERISA Group or (b) has at any time within the
preceding five (5) years been maintained or contributed to, by any
Person which was at such time a member of the ERISA Group for employees
of any Person which was at such time a member of the ERISA Group.
"Prime Rate" means the rate of interest per annum publicly
announced from time to time by NationsBank as its prime rate in effect
at its principal office in Charlotte, North Carolina, with each change
in the Prime Rate being effective on the date such change is publicly
announced as effective (it being understood and agreed that the Prime
Rate is a reference rate used by NationsBank in determining interest
rates on certain loans and is not intended to be the lowest rate of
interest charged on any extension of credit by NationsBank to any
debtor).
"Quarterly Period" means a three month period ending on the
last Business Day of each March, June, September and December.
"Ratings Services" shall have the meaning provided in the
definition of "Applicable Percentage".
"REIT" means a real estate investment trust as defined in
Sections 856-860 of the Internal Revenue Code of 1986, as amended and
any successor provision.
"Regulation T" means Regulation T of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Regulation X" means Regulation X of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Release" has the meaning given to such term in Section
4.06(a) hereof.
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"Revolving Credit Agreement" means the $265 million Revolving
Credit Agreement dated as of the date hereof, as amended, modified,
supplemented and extended, among the Borrower, the banks identified
therein and NationsBank, N.A., as Agent.
"Revolving Loans" means the revolving loans made under the
Revolving Credit Agreement.
"Securities Transaction" means any purchase or other
acquisition (including any such transaction effected by way of
partnership formation, upreit, merger, amalgamation or consolidation)
by the Borrower or any of its Subsidiaries subsequent to the date
hereof of any real estate asset or any entity which has as its
principal assets, real estate, through which Borrower or any of its
Subsidiaries issue consideration comprised principally of its
respective stock or securities, including, without limitation, common
stock, preferred stock, bonds, and hybrid securities.
"Security Agreements" means those Assignments of Notes and
Liens given by CCT and its Subsidiaries of mortgage indebtedness owing
to them, as amended, modified and replaced
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., or any successor or assignee of the business of such
division in the business of rating securities.
"Solvent" means, with respect to any person on a particular
date, that on such date (a) the fair value of the property of such
Person is greater than the total amount of liabilities, including,
without limitation, contingent liabilities, of such Person, (b) the
present fair saleable value of the assets of such Person is not less
than the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and matured, (c) such
Person is able to realize upon its assets and pay its debts and other
liabilities, contingent obligations and other commitments as they
mature, (d) such Person does not intend to, and does not believe that
it will, incur debts or liabilities beyond such Person's ability to pay
as such debts and liabilities mature, and (e) such Person is not
engaged in a business or a transaction, and is not about to engage in a
business or a transaction, for which such Person's property would
constitute unreasonably small capital after giving due consideration to
the prevailing practice in the industry in which such Person is
engaged. In computing the amount of contingent liabilities at any time,
it is intended that such liabilities will be computed at the amount
which, in light of all the facts and circumstances existing at such
time, represents the amount that can reasonably be expected to become
an actual or matured liability.
"Specified Affiliate" means any corporation, association or
other business entity formed for the purpose of earning income not
qualified as "rents from real property" under applicable provisions of
the Code, in which the Borrower owns substantially all of the economic
interest but less than 10% of the voting interests, and the remaining
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economic and voting interests are subject to restrictions requiring
that ownership of such interests be held by officers, directors or
employees of the Borrower.
"Subsidiaries Guarantee" means (i) with respect to the Tranche
A Term Loan, the Subsidiaries Guarantee to be executed and delivered by
each of the Material Subsidiaries of HRT, and (ii) with respect to the
Tranche B Term Loan, the Subsidiaries Guarantee to be executed and
delivered by each of the Material Subsidiaries of CCT, in each case
substantially in the form of Schedule 5.09 as the same may be amended,
supplemented or otherwise modified from time to time.
"Subsidiary" means, with respect to any Person, any
corporation or other entity of which securities or other ownership
interests having ordinary voting power to elect a majority of the board
of directors or other persons performing similar functions are at such
time directly or indirectly owned by such Person.
"Term Loans" means the Tranche A Term Loan and the Tranche B
Term Loan.
"Term Loan Commitments" means the Tranche A Term Loan
Commitment and the Tranche B Term Loan Commitment.
"Term Loan Commitment Percentage" means the Tranche A Term
Loan Commitment Percentage or the Tranche B Term Loan Commitment
Percentage, as appropriate.
"Term Note" or "Term Notes" means the Tranche A Term Notes and
the Tranche B Term Notes.
"Tranche A Maturity Date" means such term as defined in
Section 2.04(a).
"Tranche B Maturity Date" means such term as defined in
Section 2.04(b).
"Tranche A Term Loan" means such term as defined in Section
2.01(a).
"Tranche A Term Loan Commitment" means, with respect to each
Bank, the commitment of such Bank to make its portion of the Tranche A
Term Loan as specified in Schedule 2.01 (and for purposes of making
determinations of Majority Banks hereunder after the Closing Date and
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for purposes of calculations referred to in Section 9.05, the principal
amount outstanding on the Tranche A Term Loan).
"Tranche A Term Loan Commitment Percentage" means, for each
Bank, a fraction (expressed as a percentage) the numerator of which is
the Tranche A Term Loan Commitment (and after the Closing Date, the
outstanding principal amount of such Bank's Tranche A Term Loan) of
such Bank at such time and the denominator of which is the aggregate
amount of the Tranche A Term Loan Commitment (and after the Closing
Date, the aggregate principal amount of the Tranche A Term Loan) at
such time. The initial Tranche A Term Loan Commitment Percentages are
set out on Schedule 2.01.
"Tranche A Term Note" or "Tranche A Term Notes" means the
promissory notes of the Borrower in favor of each of the Banks
evidencing the Tranche A Term Loans in substantially the form attached
as Schedule 2.06(a), individually or collectively, as appropriate, as
such promissory notes may be amended, modified, supplemented, extended
or renewed from time to time.
"Tranche B Term Loan" means such term as defined in Section
2.01(a).
"Tranche B Term Loan Commitment" means, with respect to each
Bank, the commitment of such Bank to make its portion of the Tranche B
Term Loan as specified in Schedule 2.1 (and for purposes of making
determinations of Majority Banks hereunder after the Closing Date and
for purposes of calculations referred to in Section 9.05, the principal
amount outstanding on the Tranche B Term Loan).
"Tranche B Term Loan Commitment Percentage" means, for each
Bank, a fraction (expressed as a percentage) the numerator of which is
the Tranche B Term Loan Commitment (and after the Closing Date, the
outstanding principal amount of such Bank's Tranche B Term Loan) of
such Bank at such time and the denominator of which is the aggregate
amount of the Tranche B Term Loan Commitment (and after the Closing
Date, the aggregate principal amount of the Tranche B Term Loan) at
such time. The initial Tranche B Term Loan Commitment Percentages are
set out on Schedule 2.01.
"Tranche B Term Note" or "Tranche B Term Notes" means the
promissory notes of the Borrower in favor of each of the Banks
evidencing the Tranche B Term Loans in substantially the form attached
as Schedule 2.06(b), individually or collectively, as appropriate, as
such promissory notes may be amended, modified, supplemented, extended
or renewed from time to time.
"UCC" means, with respect to any jurisdiction, the Uniform
Commercial Code as then in effect in that jurisdiction.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (a) the present value of all
benefits under such Plan exceeds (b) the fair market value of all Plan
assets allocable to such benefits (excluding any accrued but unpaid
contributions), all determined as of the then most recent valuation
date for such Plan, but only to the extent that such excess represents
a potential liability of a member of the ERISA Group to the PBGC or any
other Person under Title IV of ERISA.
"Wholly-Owned Consolidated Subsidiary" means, with respect to
any Person, any Consolidated Subsidiary of such Person all of the
shares of capital stock or other ownership interests of which (except
directors' qualifying shares) are at the time directly or indirectly
owned by such Person.
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SECTION 1.02 Accounting Terms. Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all accounting determinations
hereunder shall be made, and all financial statements and certificates required
to be delivered hereunder shall be prepared in accordance with generally
accepted accounting principles in effect as of the Closing Date consistently
applied; provided that, if the Borrower notifies the Agent that the Borrower
wishes to amend any covenant in Article V to eliminate the effect of any change
in generally accepted accounting principles on the operation of such covenant
(or if the Agent notifies the Borrower that the Majority Banks wish to amend
Article V for such purpose), then the Borrower's compliance with such covenant
shall be determined on the basis of generally accepted accounting principals in
effect immediately before the relevant change in generally accepted accounting
principles became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to the Borrower and the Majority
Banks.
SECTION 1.03 Other Definitional Provisions. References to "Articles",
"Sections" "subsections", "Schedules" and "Exhibits" shall be to Articles,
Sections, subsections, Schedules and Exhibits, respectively, of this Credit
Agreement unless otherwise specifically provided. Any of the terms defined in
Section 1.01 or referred to in Section 1.02 may, unless the context otherwise
requires, be used in the singular or the plural depending on the reference. In
this Credit Agreement, the word "including" means "including without limitation"
and the word "includes" means "includes without limitation." Terms defined in
this Credit Agreement and used, but not otherwise defined in the Exhibits and
Schedules, shall have the meaning ascribed to such terms in this Credit
Agreement
ARTICLE II
THE LOANS
SECTION 2.01 Commitments.
(a) Tranche A Term Loan. Subject to the terms and conditions hereof,
each Bank severally agrees to make its Tranche A Term Loan Commitment Percentage
of a term loan (the "Tranche A Term Loan") in the aggregate principal amount of
ONE HUNDRED EIGHTY-SEVEN MILLION FOUR HUNDRED THOUSAND DOLLARS ($187,400,000) to
HRT on the Closing Date. The Tranche A Term Loan may consist of Base Rate Loans
or Eurodollar Loans, or a combination thereof, as the Borrower may request.
Amounts repaid on the Term Loan may not be reborrowed. The portion of the
Tranche A Term Loan consisting of Eurodollar Loans shall be in the minimum
aggregate principal amount of One Million Dollars ($1,000,000) and integral
multiples of One Hundred Thousand Dollars ($100,000) in excess thereof.
Notwithstanding anything contained herein to the contrary, HRT shall be limited
to a maximum number of four (4) Eurodollar Loans outstanding at any time.
(b) Tranche B Term Loan. Subject to the terms and conditions hereof,
each Bank severally agrees to make its Tranche B Term Loan Commitment Percentage
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of a term loan (the "Tranche B Term Loan") in the aggregate principal amount of
TWELVE MILLION SIX HUNDRED THOUSAND DOLLARS ($12,600,000) to CCT on the Closing
Date. The Term Loan may consist of Base Rate Loans or Eurodollar Loans, or a
combination thereof, as the Borrower may request. Amounts repaid on the Tranche
B Term Loan may not be reborrowed. The portion of the Tranche B Term Loan
consisting of Eurodollar Loans shall be in the minimum aggregate principal
amount of One Million Dollars ($1,000,000) and integral multiples of One Hundred
Thousand Dollars ($100,000) in excess thereof. Notwithstanding anything
contained herein to the contrary, CCT shall be limited to three (3) Eurodollar
Loans outstanding at any time.
SECTION 2.02 Method of Borrowing.
(a) The Borrower shall give the Agent and each Bank notice (a "Notice
of Borrowing") not later than (i) 11:00 A.M. (Charlotte, North Carolina time) on
the date of each Base Rate Borrowing and (ii) 11:00 A.M. (Charlotte, North
Carolina time) on the third (3rd) Eurodollar Business Day before each Eurodollar
Borrowing, specifying:
(i) the amount of the proposed Borrowing;
(ii) the date of such Borrowing, which shall be a
Business Day in the case of a Base Rate Borrowing or a Eurodollar
Business Day in the case of a Eurodollar Borrowing;
(iii) whether the Loans comprising such Borrowing are to
be Base Rate Loans or Eurodollar Loans, or a combination thereof, and
(iv) in the case of a Eurodollar Borrowing, the duration
of the initial Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent shall promptly
notify each Bank of the contents thereof and of such Banks ratable share of such
Borrowing and such Notice of Borrowing shall not thereafter be revocable by the
Borrower.
(c) Not later than (i) 2:00 P.M., (Charlotte, North Carolina time) on
the date of each Base Rate Borrowing, and (ii) 11:00 A.M. (Charlotte, North
Carolina time) on the date of each Eurodollar Borrowing, each Bank shall make
available its ratable share of such Borrowing, in federal or other funds
immediately available in Charlotte, North Carolina, to the Agent at its address
specified in or pursuant to Section 9.01. Unless any applicable condition
specified in Article III has not been satisfied, the Agent will make the funds
so received from the Banks available to the Borrower at an account of the
Borrower with the Agent immediately after being made available to the Agent at
the Agent's aforesaid address in immediately available funds.
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SECTION 2.03 Notes.
(a) The Term Loans shall be evidenced by a duly executed Term Note in
favor of each Bank.
(b) Upon receipt of each Bank's Note pursuant to Section 3.01(b), the
Agent shall forward such Note to such Bank via overnight courier service. Each
Bank shall record on its Note the date, amount and maturity of each Loan made by
it and the date and amount of each payment of principal made by the Borrower
with respect thereto, and prior to any transfer of its Note shall endorse on the
schedule forming a part thereof appropriate notations to evidence the foregoing
information with respect to each such Loan then outstanding; provided that the
failure of any Bank to make any such recordation or endorsement shall not affect
the obligations of the Borrower hereunder or under such Note. Each Bank is
hereby irrevocably authorized by the Borrower so to endorse its Note and to
attach to and make a part of its Note a continuation of any such schedule as and
when required.
SECTION 2.04 Maturity of Loans.
(a) The Tranche A Term Loan, together with accrued interest, fees and
other amounts owing hereunder, is due and payable in full on April 15, 1999
(being the date six months following the Closing Date) (the "Tranche A Maturity
Date"); provided that the Tranche A Maturity Date may be extended at the
election of the Borrower on written notice to the Agent for an additional period
of six months to the anniversary date of the Closing Date upon payment of a
non-refundable extension fee of thirty basis points (30 bps) on the outstanding
principal amount of the Tranche A Term Loan to the Agent for the ratable benefit
of the Banks. Payment of the Tranche A Term Loan will be applied ratably to
payment of the Tranche A Term Loan held by the Banks in accordance with their
respective Tranche A Term Loan Commitment Percentages.
(b) The Tranche B Term Loan, together with accrued interest, fees and
other amounts owing hereunder, is due and payable in full on April 15, 1999
(being the date six months following the Closing Date) (the "Tranche B Maturity
Date"). Payment of the Tranche B Term Loan will be applied ratably to payment of
the Tranche B Term Loan held by the Banks in accordance with their respective
Tranche B Term Loan Commitment Percentages.
(c) Within the foregoing limits of this Section 2.04, each required
payment or prepayment shall be applied to the outstanding Group or Groups of
Loans as the Borrower may designate to the Agent not less than five (5) Business
Days or five (5) Eurodollar Business Days, as the case may be, prior to the date
required for such payment or prepayment or failing such designation by the
Borrower, as the Agent may specify by notice to the Borrower and the Banks.
SECTION 2.05 Interest Rates.
(a) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made until it
becomes due, at a rate equal to the Base Rate for such day plus the Applicable
Percentage. Such interest shall be payable quarterly in arrears on the last day
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of each Quarterly Period and on each date a Base Rate Loan is converted to a
Eurodollar Loan. Any overdue principal of or interest on any Base Rate Loan
shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the sum of 2.000% plus the rate otherwise applicable to Base Rate
Loans for such day.
(b) Each Eurodollar Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a rate
equal to the Adjusted Eurodollar Rate for such Interest Period plus the
Applicable Percentage. Such interest shall be payable for each Interest Period
on the last day thereof and, if such Interest Period is longer than 3 months, at
intervals of 3 months after the first day thereof. Any overdue principal of or
interest on any Eurodollar Loan shall bear interest, payable on demand for each
day until paid at a rate per annum equal to the sum of 2.000% plus (i) for each
day during any Interest Period applicable to such Eurodollar Loan, the rate
applicable to such Eurodollar Loan for such day, and (ii) for each day after the
end of such Interest Period, the sum of 2.000% plus the rate applicable to Base
Rate Loans for such day.
(c) The Agent shall determine each interest rate applicable to the
Loans hereunder. The Agent shall give prompt notice to the Borrower and the
Banks by facsimile, telex or cable of each rate of interest so determined, and
its determination thereof shall be conclusive in the absence of manifest error.
(d) The Eurodollar Reference Bank agrees to use its best efforts to
furnish quotations to the Agent as contemplated by this Section 2.05. If the
Eurodollar Reference Bank does not a timely quotation, the provisions of Section
8.01 shall apply.
SECTION 2.06 INTENTIONALLY OMITTED
SECTION 2.07 INTENTIONALLY OMITTED
SECTION 2.08 INTENTIONALLY OMITTED
SECTION 2.09 Prepayments.
(a) Optional Prepayments.
(i) The Borrower may, upon written notice delivered to
the Agent not later than 2:00 P.M. (Charlotte, North Carolina time) on
the first Business Day prior to the date of such prepayment, prepay a
Group of Base Rate Loans in whole at any time, or from time to time in
part in amounts aggregating $500,000.00 or any larger multiple of
$100,000.00 by paying (in Dollars) the principal amount to be prepaid
together with accrued interest thereon to the date of prepayment. Each
such optional prepayment shall be applied to prepay ratably the Base
Rate Loans of the several Banks included in such Group.
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(ii) The Borrower may, upon at least three (3) Eurodollar
Business Days' notice to the Agent, prepay a Group of Eurodollar Loans
in whole at any time, or from time to time in part in amounts
aggregating $1,000,000.00 or any larger multiple of $100,000.00, by
paying the principal amount to be prepaid together with accrued
interest thereon to the date of prepayment, as designated by Borrower
pursuant to Section 2.04(b); provided that the Borrower shall reimburse
each Bank for any loss or expense incurred by it as a result of any
such prepayment in accordance with Section 2.12. Each such optional
prepayment shall be applied to prepay ratably the Loans of the several
Banks included in such Group.
(iii) Upon receipt of a notice of prepayment pursuant to
this Section, the Agent shall promptly notify each Bank of the contents
thereof and of such Bank's ratable share of such prepayment and such
notice shall not thereafter be revocable by the Borrower. Amounts
prepaid on the Term Loan may not be reborrowed.
(b) Mandatory Prepayments.
(i) Mandatory Prepayments from Asset Sales. Within five (5)
Business Days (or such longer period of time agreed to by the Banks
hereunder) of each receipt by a Borrower or any of its Subsidiaries or
Specified Affiliates of any Net Sale Proceeds from any Asset Sale, such
Borrower shall prepay, or cause such Subsidiary or Specified Affiliate
to prepay on behalf of such Borrower, to the Agent hereunder for the
account of the Banks hereunder an amount equal to 100% of all Net Sale
Proceeds from all such Asset Sales. Prepayments in respect of Asset
Sales by HRT and its Subsidiaries (other than CCT and its Subsidiaries)
pursuant to this subsection (b)(i) shall be applied to prepay the
Tranche A Term Loan until paid in full, including accrued interest and
fees and other amounts owing thereunder, together with interest accrued
thereon to the date of prepayment, and prepayments in respect of Asset
Sales by CCT and its Subsidiaries pursuant to this subsection (b)(i)
shall be applied to prepay the Tranche B Term Loan until paid in full,
including accrued interest and fees and other amounts owing thereunder,
together with interest accrued thereon to the date of prepayment;
provided, however, that in the event of any such prepayment of a
Eurodollar Loan other than on the last day of the Interest Period
therefor, the Borrowers shall be obligated to reimburse the Banks in
respect thereof pursuant to Section 2.12.
(ii) Mandatory Prepayment from the Proceeds of Equity
Contributions or the Issuance of Stock. Within five (5) Business Days
(or such longer period of time agreed to by the Banks hereunder) of
each date on which a Borrower or any of its Subsidiaries receives cash
proceeds from any equity contributions or cash proceeds from the
issuance of stock, such Borrower shall make payment, or shall cause any
such Subsidiary to make payment, of such cash proceeds less any actual
out of pocket expenses, fees and other sums paid or incurred by such
Borrower or its Subsidiary in connection therewith on the Term Loans as
hereafter provided. Prepayments in respect of equity contributions to
or the issuance of stock by HRT and its Subsidiaries (other than CCT
and its Subsidiaries) pursuant to this subsection (b)(ii) shall be
applied to prepay the Tranche A Term Loan until paid in full, including
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accrued interest and fees and other amounts owing thereunder, and
prepayments in respect of equity contributions to or the issuance of
stock by CCT and its Subsidiaries pursuant to this subsection (b)(ii)
shall be applied to prepay the Tranche B Term Loan until paid in full,
including accrued interest and fees and other amounts owing thereunder;
provided however, that (A) the foregoing provisions shall not apply to
any Dividend Reinvestment Plan or any successor or similar plan of HRT
and (B) in the event of any such prepayment of a Eurodollar Loan other
than on the last day of the Interest Period therefor, the Borrowers
shall be obligated to reimburse the Banks in respect thereof pursuant
to Section 2.12.
(iii) Mandatory Prepayment from the Proceeds of Debt. Within
five (5) Business Days (or such longer period of time agreed to by the
Banks hereunder) of each date on which a Borrower or any of its
Subsidiaries receives cash proceeds from the issuance of Debt after the
Closing Date (other than (i) borrowings under the Revolving Credit
Agreement, or (ii) mortgage indebtedness assumed in connection with
purchases and acquisitions otherwise permitted hereunder), such
Borrower shall make payment, or shall cause any such Subsidiary to make
payment, of such cash proceeds less any actual out of pocket expenses,
fees and other sums paid or incurred by such Borrower or its Subsidiary
in connection therewith on the Term Loans as hereafter provided.
Prepayments in respect of the issuance of Debt by HRT and its
Subsidiaries (other than CCT and its Subsidiaries) pursuant to this
subsection (b)(ii) shall be applied to prepay the Tranche A Term Loan
until paid in full, including accrued interest and fees and other
amounts owing thereunder, and prepayments in respect of the issuance of
stock by Debt and its Subsidiaries pursuant to this subsection (b)(ii)
shall be applied to prepay the Tranche B Term Loan until paid in full,
including accrued interest and fees and other amounts owing thereunder;
provided however, that in the event of any such prepayment of a
Eurodollar Loan other than on the last day of the Interest Period
therefor, the Borrowers shall be obligated to reimburse the Banks in
respect thereof pursuant to Section 2.12.
(iv) Notice of Mandatory Prepayment. The applicable Borrower
shall notify the Agent of any prepayment pursuant to this Section 2.09
at least two (2) Business Days prior to the date on which such
prepayment is required to be made and deliver a compliance certificate
with the prepayment in form and substance satisfactory to the Agent;
provided, however, that the failure to give such notice shall not
affect the obligation of the Borrower to make such prepayment on such
date.
SECTION 2.10 Method of Electing Interest Rates.
(a) The Loans included in each Borrowing shall bear interest initially
at the type of rate specified by the Borrower in the applicable Notice of
Borrowing. Thereafter, the Borrower may from time to time elect to change or
continue the type of interest rate borne by each Group of Loans (subject in each
case to the provisions of Article VIII), as follows:
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(i) if such Loans are Base Rate Loans, the Borrower may
elect to convert such Loans to Eurodollar Loans as of any Eurodollar
Business Day; and
(ii) if such Loans are Eurodollar Loans, the Borrower may
elect to convert such Loans to Base Rate Loans or elect to continue
such Loans as Eurodollar Loans for an additional Interest Period, in
each case effective on the last day of the then current Interest Period
applicable to such Loans;
provided, that the Borrower may not elect to continue any Eurodollar Loan or
convert any Loan into a Eurodollar Loan after the occurrence and during the
continuation of a Default. Each such election shall be made by delivering a
notice in substantially the form of Schedule 2.10 (a "Notice of Interest Rate
Election") to the Agent no later than 11:00 A.M. (Charlotte, North Carolina
time) (x) if the relevant Loans are to be converted to Base Rate Loans, the
second Business Day before such conversion or continuation is to be effective
and (y) if the relevant Loans are to be converted to Eurodollar Loans or
continued as Eurodollar Loans for an additional Interest Period, the third
Eurodollar Business Day before such conversion or continuation is to be
effective. A Notice of Interest Rate Election may, if it so specifies, apply to
only a portion of the aggregate principal amount of the relevant Group of Loans;
provided that (i) such portion is allocated ratably among the Loans comprising
such Group and (ii) the portion to which such Notice applies, and the remaining
portion to which it does not apply, are each at least $500,000.00 and no more
than one of such portions is other than a multiple of $100,000.00.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Loans (or portion thereof) to which
such notice applies;
(ii) the date on which the conversion or continuation
selected in such notice is to be effective, which shall comply with
subsection (a) above;
(iii) if the Loans comprising such Group are to be
converted, the new type of Loans and, if such new Loans are Eurodollar
Loans, the duration of the initial Interest Period applicable thereto;
and
(iv) if such Loans are to be continued as Eurodollar
Loans for an additional Interest Period, the duration of such
additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period. No more than
four (4) Groups of Loans shall be outstanding at any time in respect of the
Tranche A Term Loan, and no more than three (3) Groups of Loans shall be
outstanding at any time in respect of the Tranche B Term Loan.
(c) Upon receipt of a Notice of Interest Rate Election from the
Borrower pursuant to Section 2.10(a) above, the Agent shall promptly notify each
Bank of the contents thereof and such notice shall not thereafter be revocable
by the Borrower. If the Borrower fails to deliver a timely Notice of Interest
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Rate Election to the Agent for any Group of Eurodollar Loans, such Loans shall
be converted into Base Rate Loans on the last day of the then current Interest
Period applicable thereto.
SECTION 2.11 General Provisions as to Payments.
(a) The Borrower shall make each payment of principal of, and interest
on, the Loans and of fees hereunder, without setoff, deduction counterclaim or
withholding of any kind, not later than 3:00 p.m. (Charlotte, North Carolina
time) on the date when due, in federal or other funds immediately available in
Charlotte, North Carolina, to the Agent at its address referred to in Section
9.01 and any of such payments received after 3:00 p.m. on the required due date
shall be deemed to have been paid by the Borrower on the next succeeding
Business Day. Any such payment with respect to a Loan shall be made in Dollars.
The Agent will promptly distribute to each Bank its ratable share of each such
payment received by the Agent for the account of the Banks. Whenever any payment
of principal of, or interest on, the Base Rate Loans or of fees shall be due on
a day which is not a Business Day, the date for payment thereof shall be
extended to the next succeeding Business Day. Whenever any payment of principal
of, or interest on, the Eurodollar Loans shall be due on a day which is not a
Eurodollar Business Day, the date for payment thereof shall be extended to the
next succeeding Eurodollar Business Day unless such Eurodollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Eurodollar Business Day. If the date for any payment
of principal is extended by operation of law or otherwise, interest thereon
shall be payable for such extended time.
(b) Unless the Agent shall have received notice from the Borrower prior
to the date on which any payment is due to the Banks hereunder that the Borrower
will not make such payment in full, the Agent may assume that the Borrower has
made such payments in full to the Agent, on such date and the Agent may, in
reliance upon such assumption, cause to be distributed to each Bank on such due
date an amount equal to the amount then due such Bank. If and to the extent that
the Borrower shall not have so made such payments, each Bank shall repay to the
Agent forthwith on demand such amount distributed to such Bank together with
interest thereon, for each day from the date such amount is distributed to such
Bank until the date such Bank repays such amount to the Agent, at the Federal
Funds Rate.
SECTION 2.12 Funding Losses. If the Borrower makes any payments of
principal with respect to any Eurodollar Loan or any Eurodollar Loan is
converted to another type of Loan (pursuant to Articles II, VI, VIII, or
otherwise) on any day other than the last day of an Interest Period applicable
thereto, or if the Borrower fails to borrow or prepay any Eurodollar Loans after
notice has been given to any Bank in accordance with the terms hereof, the
Borrower shall reimburse each applicable Bank on demand for any resulting
reasonable out of pocket loss or expense incurred by it (or any existing
Participant in the related Loan, provided that the amount collected by a Bank
and its Participant shall not exceed the amount which the Bank would have been
entitled to collect absent such participation), including (without limitation)
any such loss incurred in obtaining, liquidating or employing deposits from
third parties to fund or maintain such Loan or proposed Loan, but excluding loss
of margin for the period after any such payment or conversion or failure to
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borrow or prepay, provided that such Bank shall have delivered to the Borrower
(with a copy to the Agent) a certificate prior to requesting reimbursement
setting forth in reasonable detail its calculation of the amount of such loss or
expense, which certificate shall be conclusive in the absence of manifest error.
NOTWITHSTANDING THE FOREGOING PROVISIONS OF THIS SECTION 2.12 TO THE CONTRARY,
THE TERM "LOSS" SHALL NOT INCLUDE AND BORROWER SHALL NOT BE RESPONSIBLE FOR THE
PAYMENT OF ANY LOST PROFITS (IN EXCESS OF THE AMOUNTS OTHERWISE PAYABLE BY
BORROWER HEREUNDER AS A PART OF THE ADJUSTED EURODOLLAR RATE) OR ANY
CONSEQUENTIAL, SPECULATIVE, PUNITIVE OR OTHER DAMAGES.
SECTION 2.13 Computation of Interest and Fees. All interest and fees
hereunder shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.14 Withholding Tax Exemption. At least five (5) Business Days
prior to the first date on which interest or fees are payable hereunder for the
account of any Bank, each Bank that is not incorporated under the laws of the
United States of America or a state thereof agrees that it will deliver to the
Borrower and the Agent two duly and properly completed copies of United States
Internal Revenue Service Form 1001 or 4224 (or any successor form, in either
case), certifying in either case that such Bank is entitled to receive payments
under this Credit Agreement and the Notes without deduction or withholding of
any United States federal income taxes. Each Bank which so delivers a Form 1001
or 4224 (or any successor form, in either case) further undertakes to deliver to
the Borrower and the Agent two (2) additional copies of such form (or a
successor form) on or before the date that such form expires or becomes obsolete
or after the occurrence of any event requiring a change in the most recent form
so delivered by it, and such amendments thereto or extensions or renewals
thereof as may be reasonably requested by the Borrower or the Agent, in each
case certifying that such Bank is entitled to receive payments under this Credit
Agreement and the Notes without deduction or withholding of any United States
federal income taxes, unless an event (including without limitation any change
in treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Bank from duly completing and delivering any such
form with respect to it and such Bank advises the Borrower and the Agent that it
is not capable of receiving payments without any deductions or withholding of
United States federal income tax, in which case such Bank shall have appropriate
amounts withheld pursuant to applicable law. Notwithstanding any provision
contained in this Credit Agreement to the contrary, if the Borrower, on advice
of counsel, reasonably believes that the Borrower should withhold an amount with
respect to any Bank on account of any applicable Government requirement, the
Borrower shall be entitled to withhold such sum in accordance with the
applicable Government requirement.
SECTION 2.15 Fees.
(a) Upfront and Other Fees. The Borrower agrees to pay to the Agent for
the benefit of the Banks the upfront and other fees provided in the Agent's Fee
Letter.
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(b) Agent's Fees. The Borrower agrees to pay the Agent such fees as may
be agreed upon by the Agent and the Borrower from time to time.
ARTICLE III
CONDITIONS
SECTION 3.01 Conditions to Initial Extensions of Credit. The obligation
of the Banks to make initial Extensions of Credit hereunder is subject to the
satisfaction of such of the following conditions in all material respects on or
prior to the Closing Date as shall not have been expressly waived in accordance
with Section 9.05:
(a) The Agent shall have received counterparts hereof signed by each of
the parties hereto (or, in the case of any party (other than the Borrower) as to
which an executed counterpart shall not have been received, receipt by the Agent
in form satisfactory to it of telegraphic, facsimile, telex or other written
confirmation from such party of execution of a counterpart hereof by such
party); provided, however, in any event, the Agent shall distribute to each Bank
promptly after the Closing Date an original Credit Agreement executed by the
Borrowers, the Banks and the Agent;
(b) The Agent shall have received a duly executed Term Note for the
account of each Bank, complying with Section 2.03;
(c) The Agent shall have received the duly executed Subsidiaries
Guarantees and the Security Agreements;
(d) The Agent and each Bank shall have received legal opinions of
counsel to the Borrowers and the other Obligors, in form and substance
satisfactory to the Agent and the Banks;
(e) The Agent shall have received all documents it may reasonably
request relating to the existence of the Borrowers and each Obligor, the
corporate authority for and the validity of each of the Financing Documents, and
any other matters relevant hereto, all in form and substance satisfactory to the
Agent;
(f) No Default shall have occurred and be continuing immediately before
the making of such Extension of Credit and no Default shall exist immediately
thereafter;
(g) The representations and warranties of the Borrowers and the
Obligors made in or pursuant to the Financing Documents to which it is a party
shall be true in all material respects as of the date of the making of such
Extensions of Credit;
(h) The Extension of Credit will be extended in compliance with all
applicable governmental laws and regulations (including without limitation
Regulations U, T and X);
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(i) The Agent shall have received a certificate of each of the
Borrowers, signed on behalf of each Borrower by the Borrower's chief executive
officer or chief financial officer, confirming to the knowledge of such officer
that no Default is continuing, the Borrower is Solvent and all other conditions
precedent to the initial borrowing hereunder have been satisfied in all material
respects;
(j) No litigation shall be pending or to the knowledge of Borrowers
threatened against the Borrowers, any Material Subsidiary or any Specified
Affiliate which would be likely to materially and adversely affect the assets,
operations, business or condition, financial or otherwise, of the Borrowers, any
Material Subsidiary or any Specified Affiliate, or which could reasonably be
expected to affect materially and adversely the ability of the Borrowers to
fulfill their obligations hereunder;
(k) There shall not have occurred or become known any material adverse
change with respect to the condition (financial or otherwise), operations,
business or assets of the Borrowers and their Subsidiaries taken as a whole,
since December 31, 1997;
(l) The Agent shall have received a certified copy of the definitive
Agreement and Plan of Merger dated as of June 8, 1998, among the Borrower, HR
Acquisition I Corporation and Capstone Capital Corporation, including exhibits,
schedules, amendments and modifications thereto, and related documentation;
(m) certification that the conditions to effectiveness of the merger,
but for payment of the purchase price, have been satisfied and evidence that
immediately upon funding of the Tranche B Term Loan hereunder the merger will be
consummated in accordance with the foregoing Agreement and Plan of Merger;
(n) delivery within three (3) Business Days following the Closing Date,
a preliminary pro forma balance sheet, together with a statement of sources and
uses of funds in connection with the acquisition of CCT and the initial
Extensions of Credit hereunder, in form and detail satisfactory to the Agent
(subject to final adjustments, including reallocation of purchase
consideration);
(o) confirmation of the execution and effectiveness of the Revolving
Credit Agreement and the other credit documents relating thereto.
The certificates and opinions referred to in this Section shall be
dated not earlier than the date hereof and not later than the date of such
initial Extensions of Credit.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Each of the Borrowers, respectively, represents and warrants, for itself and its
respective subsidiaries (except that with respect to CCT, the representation and
warranties made hereunder, other than those contained in Sections 4.01, 4.02 and
4.03, shall be made to the best of its knowledge based on due inquiry) that:
SECTION 4.01 Corporate Existence and Power. The Borrower and each of
its Subsidiaries is a corporation duly incorporated, validly existing and in
good standing under the laws of its jurisdiction of incorporation, has all
corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted and is
duly qualified as a foreign entity and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification, other than in such jurisdictions
where the failure to be so qualified and in good standing would not, in the
aggregate, have a Material Adverse Effect.
SECTION 4.02 Corporate and Governmental Authorization; No
Contravention. The execution and delivery by the Obligors of the Financing
Documents and the performance by the Obligors of their respective obligations
thereunder are within the corporate power of the Obligors, have been duly
authorized by all necessary corporate action, require no action by or in respect
of, or filing with, any governmental body, agency or official (except for any
such action or filing that has been taken and is in full force and effect) and
do not contravene, or constitute a default under, any provision of applicable
law or regulation or of the Constitutional Documents of any Obligor or of any
material agreement, judgment, injunction, order, decree or other material
instrument binding upon any Obligor or result in the creation or imposition of
any Lien on any asset of any Obligor other than Liens created pursuant to the
Financing Documents.
SECTION 4.03 Binding Effect. The Financing Documents constitute valid
and binding agreements of the Obligors enforceable against the Obligors in
accordance with their terms.
SECTION 4.04 Litigation. Except as set forth on Schedule 4.04 attached
hereto, there is no action, suit or proceeding pending against, or to the
knowledge of the Borrower threatened against or affecting, the Borrower or any
of its Subsidiaries before any court or arbitrator or any governmental body,
agency or official in which there is a reasonable possibility of an adverse
decision which would materially adversely affect the business or the
consolidated results of operations of the Borrower and its Subsidiaries, or
which in any manner draws into question the validity of any Financing Document.
SECTION 4.05 Compliance with ERISA. Except as set forth on Schedule
4.05 attached hereto, each member of the ERISA Group has fulfilled its
obligations in all material aspects under the minimum funding standards of ERISA
and the Code with respect to each Plan and is in compliance in all material
respects with the presently applicable provisions of ERISA and the Code with
respect to each Plan. Except as previously disclosed to the Banks in writing
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prior to the date hereof, no member of the ERISA Group has (i) sought a waiver
of the minimum funding standard under Section 412 of the Code in respect of any
Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or made any
amendment to any Plan or Benefit Arrangement, which in either event has resulted
or could reasonably be expected to result in the imposition of a Lien or the
posting of a bond or other security under ERISA or the Code or (iii) incurred
any liability under Title IV of ERISA other than a liability to the PBGC for
premiums or similar items under Section 4007 of ERISA.
SECTION 4.06 Environmental Matters. Except as set forth on Schedule
4.06 hereto:
(a) No written notice, notification, demand, request for information,
citation, summons, complaint or order has been received by the Borrower and to
the knowledge of the Borrower, no penalty has been assessed and no investigation
or review is pending or threatened by any governmental or other entity, (i) with
respect to any alleged violation of any Environmental Laws in connection with
the conduct of the Borrower and relating to a Hazardous Substance or (ii) with
respect to any alleged failure to have any permit, certificate, license,
approval, registration or authorization required in connection with the conduct
of the Borrower relating to a Hazardous Substance or (iii) with respect to any
generation, treatment, storage, recycling, transportation, disposal or release
(including a release as defined in 42 U.S.C. Section 9601(22)) ("Release") of
any Hazardous Substance used by the Borrower, which alleged violation, alleged
failure to have any required permit, certificate, license, approval, or
registration, or generation, treatment, storage, recycling, transportation,
disposal or release, is reasonably likely to result in liability to the Borrower
in excess of $1,000,000 in any instance or $5,000,000 in the aggregate.
(b) (i) To the Borrower's knowledge, there has been no Release of a
Hazardous Substance at, on or under any property used by the Borrower or for
which the Borrower or any of its Subsidiaries would be liable, which Release is
reasonably likely to result in liability to the Borrower in excess of $1,000,000
in any instance or $5,000,000 in the aggregate; (ii) to the Borrower's
knowledge, neither the Borrower nor any of its Subsidiaries has, other than as a
generator or in a manner not regulated or prohibited under the Environmental
Laws, stored or treated any "hazardous waste" (as defined in 42 U.S.C Section
6903(5)) on any property used by the Borrower or for which the Borrower or any
of its Subsidiaries would be liable, except for such storage or treatment which
is not reasonably likely to result in liability to the Borrower or any of its
Subsidiaries in excess of $1,000,000 in any instance or $5,000,000 in the
aggregate; and (iii) to the Borrower's knowledge no polychlorinated biphenyl
("PCB") in concentrations greater than 50 parts per million, friable asbestos,
or underground storage tank (in use or abandoned) is at any property used by the
Borrower or for which the Borrower or any of its Subsidiaries would be liable,
except for such PCBs, friable asbestos or underground storage tanks that are not
reasonably likely to result in liability to the Borrower or any of its
Subsidiaries in excess of $1,000,000 in any instance or $5,000,000 in the
aggregate.
(c) To the knowledge of the Borrower, neither the Borrower nor any of
its Subsidiaries has transported or arranged for the transportation (directly or
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indirectly) of any Hazardous Substance to any location which is listed under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended ("CERCLA"), on the Comprehensive Environmental Response, Compensation
and Liability Information System, as amended ("CERCLIS"), or on any similar
state list or which is the subject of any federal state or local enforcement
action or other investigation which may lead to claims for clean-up costs,
remedial work, damages to natural resources or for personal injury claims,
including, but not limited to, claims under CERCLA, that are reasonably likely
to result in liability to the Borrower or any of its Subsidiaries in excess of
$1,000,000 in any instance or $5,000,000 in the aggregate.
(d) No written notification of a Release of a Hazardous Substance has
been filed by or on behalf of the Borrower or any of its Subsidiaries, which
individually or in combination with other such Releases, is reasonably likely to
result in liability for the Borrower or any of its Subsidiaries in excess of
$1,000,000 in any instance or $5,000,000 in the aggregate.
(e) There have been no environmental audits or similar investigations
conducted by or which are in the possession of the Borrower or any of its
Subsidiaries in relation to any property used by the Borrower or for which the
Borrower or any of its Subsidiaries would be liable, which identify one or more
environmental liabilities of the Borrower or any of its Subsidiaries which are
reasonably likely to exceed $1,000,000 in any instance or $5,000,000 in the
aggregate.
SECTION 4.07 Subsidiaries. Set forth on Schedule 4.07 hereto is a
complete and accurate list of all of the Subsidiaries of the Borrower, showing
as to each such Subsidiary the jurisdiction of its organization, the number of
shares of each class of capital stock or other equity interests outstanding and
the percentage of the outstanding shares of each such class owned (directly or
indirectly) by the Borrower or any other Subsidiary of the Borrower and the
number of shares covered by all outstanding options, warrants, rights of
conversion or purchase, and similar rights. All of the outstanding capital stock
or other equity interests of all of such Subsidiaries identified in such
Schedule 4.07 as being owned by the Borrower or any of its Subsidiaries has been
validly issued, is fully paid and nonassessable and is owned directly or
indirectly by the Borrower or any of its Subsidiaries, as the case may be, free
and clear of all Liens other than a Lien described in and permitted by Section
5.07 hereof. Each corporate Subsidiary of the Borrower is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
SECTION 4.08 Not an Investment Company. Neither the Borrower nor any of
its Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
SECTION 4.09 Margin Stock. No proceeds of any Loan will be used to
purchase or carry any Margin Stock or to extend credit to others for the purpose
of purchasing or carrying any Margin Stock in violation of Regulations U, T or
X.
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SECTION 4.10 Compliance With Laws. Except as set forth on Schedule 4.10
attached hereto and made a part hereof or as previously disclosed in writing to
the Banks prior to the date hereof, the Borrower and each of its Subsidiaries is
in compliance in all material respects with all applicable laws, rules and
regulations (including, without limitation, environmental laws, rules and
regulations), and is not in violation of, or in default under, any term or
provision of any charter, bylaw, mortgage, indenture, agreement, instrument,
statute, rule, regulation, judgment, decree, order, writ or injunction
applicable to it, except for any such non-compliance, violation, default or
failure to comply which would not be reasonably expected, individually or in the
aggregate, to have a material adverse effect on the business, financial position
or results of operations of the Borrower or any of its Subsidiaries, or on the
ability of the Borrower or any of its Subsidiaries to perform its obligations
under the Financing Documents.
SECTION 4.11 Absence of Liens. There are no liens of any nature
whatsoever on any properties or assets of the Borrower or any of its
Subsidiaries, except as otherwise permitted under Section 5.07 hereof.
SECTION 4.12 Debt. Other than as set forth on Schedule 4.12 hereto,
there is no material Debt of the Borrower and its Subsidiaries outstanding as of
the date hereof.
SECTION 4.13 Contingent Liabilities. As of the Closing Date, other than
as set on Schedule 4.13 there are no material contingent liabilities (other than
contingent liabilities that constitute Debt and material contingent liabilities
arising out of customary indemnifications given by the Borrower or its
Subsidiaries to its officers and directors, its underwriters or its lenders) of
the Borrower or its Subsidiaries as of the date hereof.
SECTION 4.14 Investments. Set forth on Schedule 4.14 is a complete and
accurate list, in all material respects, as of the date hereof of all
investments by the Borrower or any of its Subsidiaries in any Person, other than
investments by the Borrower or any of its Subsidiaries in a Subsidiary or
Specified Affiliate.
SECTION 4.15 Solvency. Each Obligor is Solvent after giving effect to
the transactions contemplated by the Financing Documents.
SECTION 4.16 Taxes. The Borrower and its Subsidiaries have filed, or
caused to be filed, all tax returns (federal, state, local and foreign) required
to be filed and paid all amounts of taxes shown thereon to be due (including
interest and penalties) and have paid all other taxes, fees, assessments and
other governmental charges owing by them, except for such taxes (i) which are
not yet delinquent or (ii) as are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with generally accepted accounting principles. The Borrower is not
aware of any proposed material tax assessments against it or any of its
Subsidiaries.
SECTION 4.17 REIT Status. The Borrower is taxed as a "real estate
investment trust" within the meaning of Section 856 (a) of the Code.
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SECTION 4.18 Specified Affiliates. Except as set forth on Schedule
4.07, there are no Specified Affiliates as of the date hereof.
SECTION 4.19 Financial Condition. Each of the financial statements
described below (copies of which have been provided to the Agent and the
Lenders), have been prepared in accordance with generally accepted accounting
principles applied on consistent basis throughout the periods covered thereby,
present fairly the financial condition and results from operations of the
entities and for the periods specified, subject in the case of interim
company-prepared statements to normal year-end adjustments:
(i) annual audited consolidated balance sheet of HRT and its
consolidated subsidiaries dated as of December 31, 1997, together with
related statements of income and cash flows certified by Ernst & Young,
certified public accountants;
(ii) annual audited consolidated balance sheet of CCT dated as
of December 31, 1997, together with related statements of income and
cash flows certified by KPMG Peat Marwick, certified public
accountants;
(iii) interim company-prepared consolidated balance sheet of
HRT and its consolidated subsidiaries dated as of June 30, 1998,
together with related company-prepared statements of income and cash
flows;
(iv) interim company-prepared consolidated balance sheet of
CCT and its consolidated subsidiaries dated as of June 30, 1998,
together with related company-prepared statements of income and cash
flows.
SECTION 4.20 No Material Adverse Effect. Since the date of the annual
audited financial statements referenced in Section 4.19, other than the
acquisition of CCT by HRT, there has been no circumstance, development or event
relating to or affecting the Borrower and its Subsidiaries which has had or
would reasonably be expected to have a Material Adverse Effect.
SECTION 4.21 Year 2000 Compliance. The Borrower has (i) initiated a
review and assessment of all areas within its and each of its Subsidiaries'
business and operations (including those affected by suppliers, vendors and
customers) that could be adversely affected by the "Year 2000 Problem" (that is,
the risk that computer applications used by the Borrower or any of its
Subsidiaries (or suppliers, vendors and customers) may be unable to recognize
and perform properly date-sensitive functions involving certain dates prior to
and any date after December 31, 1999), (ii) developed a plan and timeline for
addressing the Year 2000 Problem on a timely basis, and (iii) to date,
implemented that plan in accordance with that timetable. Based on the foregoing,
the Borrower believes that all computer applications (including those of its
suppliers, vendors and customers) that are material to its or any of its
Subsidiaries' business and operations are reasonably expected by no later than
December 31, 1999 to be able to perform properly date-sensitive functions for
all dates before and after January 1, 2000 (that is, be "Year 2000 compliant"),
except to the extent that a failure to do so could not reasonably be expected to
have a Material Adverse Effect.
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ARTICLE V
COVENANTS
Each of the Borrowers, respectively, hereby covenants and agrees that
until the Obligations owing by it, together with interest, fees and other
obligations hereunder, have been paid in full and the Commitments hereunder
relating thereto shall have terminated, the Borrower shall, and shall cause its
respective Subsidiaries to, perform and comply with the following covenants:
SECTION 5.01 Information. The Borrower will deliver to Agent and the
Banks:
(a) as soon as available and in any event within ninety (90) days after
the end of each fiscal year of HRT, a consolidated and consolidating balance
sheet of HRT and its Subsidiaries as of the end of such fiscal year and the
related consolidated and consolidating statements of income and consolidated
statement of cash flows for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, and, with respect to
such financial information for HRT, such consolidated statements shall be
audited statements by Ernst & Young or other independent public accountants of
nationally recognized standing and containing an opinion of such accountants,
which opinion shall be without exception, qualification or limitation on scope
of audit;
(b) as soon as available and in any event within forty-five (45) days
after the end of each of the first three (3) fiscal quarters of each fiscal year
of HRT, a consolidated and consolidating balance sheet of HRT and its
Subsidiaries as of the end of such quarter and the related consolidated and
consolidating statements of income and consolidated statement of cash flows for
such quarter and for the portion of HRT's fiscal year ended at the end of such
quarter, setting forth in each case in comparative form the figures for the
corresponding quarter and the corresponding portion of the previous fiscal year,
all certified (subject to normal year-end adjustments) as to fairness of
presentation, generally accepted accounting principles and consistency by the
chief financial officer of HRT;
(c) simultaneously with the delivery of each set of financial
statements referred to in subsections (a) and (b) of this Section, a certificate
of HRT, signed on behalf of HRT by the chief financial officer of HRT (i)
stating whether, to such officer's knowledge, there exists on the date of such
certificate any Default and, if any Default then exists, setting forth the
details thereof and the action that HRT is taking or proposes to take with
respect thereto, (ii) stating whether, since the date of the most recent
financial statements previously delivered pursuant to subsection (a) or (b) of
this Section, there has been a change in the generally accepted accounting
principles applied in preparing the financial statements then being delivered
from those applied in preparing the most recent audited financial statements so
delivered which is material to the financial statements then being delivered,
(iii) stating how much of the outstanding principal balance of the Loans as of
the end of the applicable fiscal quarter has been used for the general corporate
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purposes of HRT and its Subsidiaries, (iv) furnishing calculations demonstrating
the compliance by HRT of the covenants contained in Sections 5.18, 5.19, 5.20,
5.21 and 5.22 hereof, and (v) attaching management's summary of the results
contained in such financial statements;
(d) simultaneously with the delivery of each set of financial
statements referred to in clause (a) above, a statement (addressed to the Agent
for the benefit of the Banks) of the firm of independent public accountants
which reported on such statements whether anything has come to their attention
to cause them to believe that any Default existed on the date of such
statements;
(e) within five (5) Business Days after any officer obtains knowledge
of any Default, if such Default is then continuing, a certificate of HRT, signed
on behalf of HRT by the chief financial officer of HRT, setting forth the
details thereof and the action which the Borrower is taking or proposes to take
with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of HRT
generally, copies of all financial statements, reports and proxy statements so
mailed;
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements on
Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their
equivalents) which HRT shall have filed with the Securities and Exchange
Commission;
(h) if and when any member of the ERISA Group (i) gives or is required
to give notice to the PBGC of any "reportable event" (as defined in Section 4043
of ERISA) with respect to any Plan which might constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability with respect to any Multiemployer Plan under Title IV of
ERISA or notice that any Multiemployer Plan is in reorganization, is not Solvent
or has been terminated, a copy of such notice; (iii) receives notice from the
PBGC under Title IV of ERISA of its intent to terminate, impose liability (other
than for premiums under Section 4007 of ERISA) in respect of, or appoint a
trustee to administer any Plan, a copy of such notice; (iv) applies for a waiver
of the minimum funding standard under Section 412 of the Code, a copy of such
application; (v) gives notice of intent to terminate any Plan under Section
4041(c) of ERISA, a copy of such notice and other information filed with the
PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063 of
ERISA, a copy of such notice; or (vii) except as previously disclosed to the
Banks in writing prior to the date hereof, fails to make any payment or
contribution to any Plan or Multiemployer Plan or in respect of any Benefit
Arrangement or makes any amendment to any Plan or Benefit Arrangement which has
resulted or could result in the imposition of a lien or the posting of a bond or
other security under ERISA or the Code, a certificate of HRT, signed on behalf
of HRT by the chief financial officer, the chief accounting officer or the
treasurer of HRT, setting forth details as to such occurrence and the action, if
any, which HRT or any applicable member of the ERISA Group is required or
proposes;
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(i) as soon as possible after any officer of the Borrower obtains
knowledge of the commencement of, or of a material threat of the commencement
of, an action, suit or proceeding against the Borrower or any of its
Subsidiaries before any court or arbitrator or any governmental body, agency or
official in which there is a reasonable likelihood of an adverse decision which
would after the application of applicable insurance materially and adversely
affect the business, financial position or results of operations of the Borrower
and its Consolidated Subsidiaries, in each case considered as a whole, or which
in any manner questions the validity of any Financing Document, a written report
informing the Banks in reasonable detail of the nature of such pending or
threatened action, suit or proceeding;
(j) from time to time such additional information regarding the
financial position or business of the Borrower and its Subsidiaries, as the
Agent or any Bank may reasonably request; and
For purposes of the foregoing:
(i) during any period when generally accepted accounting
principles or related auditing standards require that a Specified
Affiliate of the Borrower be accounted for as a Subsidiary for purposes
of the consolidated financial statements of the Borrower and its
Subsidiaries, the term "Subsidiary" shall include a Specified Affiliate
of the Borrower for purposes of paragraphs (a) and (b) above; and
(ii) during any period when generally accepted accounting
principles or related auditing standards do not require that a
Specified Affiliate of the Borrower be accounted for as a Subsidiary
for purposes of the consolidated financial statements of the Borrower
and its Subsidiaries, the terms "Subsidiary" shall not include a
Specified Affiliate of the Borrower for purposes of paragraphs (a) and
(b) above and, if the Borrower shall have any Specified Affiliates
during any period covered by the financial statements delivered
pursuant to paragraphs (a) or (b) above, the Borrower shall deliver (A)
financial statements of the character specified in paragraphs (a) and
(b) above for such Specified Affiliates within the time periods set
forth in paragraphs (a) and (b) above, and (B) on a combined basis,
financial statements of the character specified in paragraphs (a) and
(b) above for the Borrower, its Subsidiaries and such Specified
Affiliates accompanied by the opinions and certificates specified in
paragraphs (b) and (c) above within the time periods set forth in
paragraphs (a), (b) and (c) above.
SECTION 5.02 Payment of Obligations. The Borrower will pay and
discharge, and will cause each of its Subsidiaries to pay and discharge, at or
before maturity, or prior to expiration of applicable notice, grace and curative
periods, all their respective material obligations and liabilities, including,
without limitation, tax liabilities, except where the same may be contested in
good faith by appropriate proceedings, and will maintain, and will cause each of
its Subsidiaries to maintain, in accordance with generally accepted accounting
principles, appropriate reserves for the accrual of any of the same.
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SECTION 5.03 Maintenance of Property; Insurance.
(a) The Borrower will keep, and will cause each of its Subsidiaries to
keep, or will in the ordinary course of business cause the tenants of respective
properties to keep, all property materially useful and necessary in its business
in good working order and condition, ordinary wear and tear excepted.
(b) The Borrower will maintain, and will cause each of its Subsidiaries
to maintain, with financially sound and responsible insurance companies,
insurance on all their respective properties in at least such amounts and
against such risks (and with such risk retention) as are usually insured against
in the same general area by companies of established repute engaged in the same
or a similar business, and will furnish to the Banks, upon request from the
Agent, information presented in reasonable detail as to the insurance so
carried. The insurance described in this Section 5.03 may be carried by the
tenants under the respective tenant leases of such properties in lieu of by
Borrower or its Subsidiaries so long as the Borrower or its respective
Subsidiary is named as loss payee and additional insured with respect to such
insurance.
SECTION 5.04 Conduct of Business and Maintenance of Existence. Except
as contemplated otherwise by the Investment Policy, the Borrower will continue,
and will cause each Subsidiary to continue, to engage in business of the same
general type as now conducted by the Borrower and each of its Subsidiaries, and
will preserve, renew and keep in full force and effect, and will cause each of
its Subsidiaries to preserve, renew and keep in full force and effect their
respective corporate existences and, except for any such rights, privileges and
franchises the failure to preserve which would not in the aggregate have a
material adverse effect on the Borrower and its Subsidiaries or the ability of
the Borrower or any Subsidiary to perform any of their respective obligations
under any Financing Document, their respective rights, privileges and franchises
necessary or desirable in the normal conduct of business; provided that nothing
in this Section 5.04 shall prohibit (a) the merger of Capstone Capital
Corporation with and into HR Acquisition I Corporation, a Delaware corporation,
which will be the surviving corporation, pursuant to the terms of the Agreement
and Plan of Merger and related agreements referenced in Section 3.01(n), (b) the
merger of a Subsidiary of the Borrower into the Borrower or the merger or
consolidation of any Subsidiary of the Borrower with or into another Person if
the corporation surviving such consolidation or merger is a Wholly-Owned
Consolidated Subsidiary of the Borrower and if, in each case, after giving
effect thereto, no Default shall have occurred and be continuing and a
responsible officer of HRT shall deliver to the Agent an officer's certificate,
in form and substance satisfactory to the Agent, indicating compliance with the
terms hereof, including specifically, the financial covenants hereunder, on a
pro forma basis after giving effect thereto or (c) the termination of the
corporate existence of any Subsidiary of the Borrower or the discontinuation of
any line of business of the Borrower or any of its Subsidiaries if the Borrower
in good faith determines that such termination is in the best interest of the
Borrower or such Subsidiary, as the case may be, and is not materially
disadvantageous to the Banks.
SECTION 5.05 Compliance with Laws. The Borrower will comply, and cause
each of its Subsidiaries to comply, in all material respects with all applicable
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laws, ordinances, rules, regulations, and requirements of governmental
authorities (including, without limitation, Environmental Laws and ERISA and the
rules and regulations thereunder) the failure to comply with which would have a
material adverse effect on the Borrower and its Subsidiaries or their ability to
perform any of its obligations under any Financing Document, except where the
necessity of compliance therewith is contested in good faith by appropriate
proceedings.
SECTION 5.06 Inspection of Property, Books and Records. The Borrower
will keep, and will cause each of its Subsidiaries to keep, proper books of
record and account in which full, true and correct entries shall be made of all
material dealings and transactions in relation to its business and activities;
and, except to the extent prohibited by applicable law, rule, regulations or
orders, will permit, and will cause each of its Subsidiaries to permit,
representatives of any Bank at such Bank's expense (which expense shall not be
subject to reimbursement by Borrower hereunder) to visit and inspect any of
their respective properties (subject to the rights of tenants in possession
thereof and to any limitations on the inspection rights of Borrower in
connection therewith), to examine and make abstracts from any of their
respective books and records and to discuss their respective affairs, finances
and accounts with their respective officers, employees and independent public
accountants, upon reasonable prior written notice to Borrower, all at such
reasonable times and as often as may reasonably be desired.
SECTION 5.07 Negative Pledge. The Borrower will not nor will it permit
any of its Subsidiaries to create, assume or suffer to exist any Lien on any
asset now owned or hereafter acquired by it, except:
(a) (i) Liens securing up to $12.6 million of the Tranche B Term Loan
under the Term Loan Agreement, (ii) Liens created by and existing under the
Financing Documents hereunder, and (iii) other mortgage Liens to the extent not
prohibited, both before and after giving effect thereto, by the provisions of
Sections 5.21 (Consolidated Senior Secured Debt to Consolidated Total Capital
Ratio) and Section 5.22 (Consolidated Unencumbered Realty to Consolidated
Unsecured Debt Ratio);
(b) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's, statutory banker's or other like Liens arising in the ordinary
course of business and which are not overdue for a period of more than thirty
(30) days or which are being contested in good faith by appropriate proceedings;
(c) Liens for taxes, assessments or other governmental charges not yet
due or which are being contested in good faith and by appropriate proceedings
and for which adequate reserves are taken in accordance with generally accepted
accounting principals;
(d) Liens imposed by law on pledges or deposits in connection with
workmen's compensation, unemployment insurance and other social security
legislation which do not interfere with or adversely affect in any material
respect the ordinary conduct of the business of the Borrower or any of its
Subsidiaries;
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(e) deposits to secure the performance of bids, tenders, trade or
government contracts (other than for borrowed money), leases, licenses,
statutory obligations, surety bonds (other than in relation to judgments),
performance bonds, reserves for capital improvements and other obligations of a
like nature incurred in the ordinary course of business;
(f) easements, rights-of-way, zoning and similar restrictions and other
encumbrances or title defects incurred, or leases or subleases granted to others
which are in existence as of the date hereof, or if not in existence as of the
date hereof, do not interfere with or adversely affect in any material respect
the ordinary conduct of the business, or detract from the value of the property,
of the Borrower or any of its Subsidiaries;
(g) Liens securing reimbursement obligations with respect to trade
letters of credit issued in the ordinary course of business; provided that such
Liens only attach to the assets being acquired with the proceeds of such letters
of credit;
(h) any Lien arising out of the refinancing, extension, renewal or
refunding of any Debt secured by any Lien, to the extent such Lien is permitted
by any of the foregoing clauses of this Section; provided that such Debt is not
increased and is not secured by any additional assets;
(i) Liens on properties securing security deposits of tenants, provided
that the aggregate amount of such security deposits secured by such Liens shall
not exceed 5% of Consolidated Total Capital at any time outstanding; and
(j) Liens securing Debt of any Subsidiary or Specified Affiliate owing
to the Borrower, any Subsidiary or Specified Affiliate.
SECTION 5.08 Consolidations, Mergers and Sales of Assets.
(a) The Borrower will not, nor will it permit any of its Subsidiaries
to, consolidate or merge with or into any other Person except as permitted in
accordance with Section 5.04.
(b) The Borrower will not, nor will it permit any of its Subsidiaries
to, make any Asset Sale except the sale of any asset listed in Schedule 5.08
hereof, unless in connection with such Asset Sale, Borrower or such Subsidiary
makes provision for the Mandatory Prepayments described in Section 2.07.
SECTION 5.09 Creation of Subsidiaries. The Borrower will not, nor will
it permit any of its Subsidiaries to, create any Subsidiary except for the
creation of a wholly owned Subsidiary of the Borrower or a Specified Affiliate
provided that (i) such Subsidiary or Specified Affiliate is organized under the
laws of a jurisdiction within the United States of America, (ii) such Specified
Affiliate and such Subsidiary, if such Subsidiary is a Material Subsidiary,
executes at the time of its creation a guaranty in favor of the Banks in the
form of Schedule 5.09 attached hereto, and (iii) no Default exists immediately
prior to or after the creation of such Subsidiary or Specified Affiliate.
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SECTION 5.10 Incurrence of Debt. The Borrower will not incur, nor will
it permit any of its Subsidiaries to incur, Debt except as follows:
(i) in the case of publicly issued or privately placed Debt,
the final maturity of such Debt shall not be prior to the Termination
Date hereunder, nor prior to the final maturity of the Term Loan;
(ii) in the case of Debt secured by mortgage liens, such Debt
shall be non-recourse to the Borrower and its Subsidiaries except to
the extent of the property pledged to secure such Debt; and
(iii) in all cases, Debt of the Borrower, provided that, after
giving effect to the incurrence thereof, the Borrower and its
Subsidiaries shall be in compliance with the terms of this Credit
Agreement, including the financial covenants hereunder.
SECTION 5.11 Transactions with Affiliates. The Borrower will not and
will not permit any Subsidiary to enter into directly or indirectly any material
transaction or material group of related transactions (including without
limitation the purchase, lease, sale or exchange of properties of any kind or
the rendering of any service) with any Affiliate (other than the Borrower, or
any Guarantor), except in the ordinary course and pursuant to the reasonable
requirements of the Borrower's or such Subsidiary's business and upon fair and
reasonable terms no less favorable to the Borrower or such Subsidiary than would
be obtainable in a comparable arm's-length transaction with a Person not an
Affiliate.
SECTION 5.12 Use of Proceeds. The Extensions of Credit hereunder will
be used (i) to finance the acquisition of Capstone Capital Corporation, (ii) to
refinance existing indebtedness for borrowed money, and (iii) to finance the
acquisition of healthcare real estate properties by the Borrower and its
Subsidiaries.
SECTION 5.13 Constitutional Documents. Subject to changes, including
any dissolutions permitted pursuant to this Credit Agreement: (i) the Borrower
will not, nor will it permit any of its Subsidiaries to, amend its
Constitutional Documents in any manner which could materially adversely affect
the rights of the Banks under the Financing Documents or their ability to
enforce the same; (ii) the Borrower will not amend its Constitutional Documents
in a manner which would permit a single shareholder (as determined for purposes
hereof pursuant to the attribution provisions of Section 544 of the Code as
modified by Section 856 of the Code) to own more than thirty percent (30%) of
the outstanding stock in Borrower; and (iii) the Borrower will not consent to
any material amendment, modification, supplement or waiver to the Agreement and
Plan of Merger (including, but not limited to, any material amendment,
modification supplement or waiver relating to any disclosure schedule or
exhibit) without the prior written consent of the Agent and the Majority Banks.
SECTION 5.14 Investments. The Borrower shall not make, nor shall it
permit any of its Subsidiaries to make, any Investment in any other Person
except for Investments made in accordance with the Borrower's Investment Policy,
except that the Borrower may make and own Investments in (i) marketable direct
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obligations issued or unconditionally guaranteed by the Government or issued by
any agency thereof and backed by the full faith and credit of the United States
of America, in each case maturing within one (1) year from the date of
acquisition thereof, (ii) marketable direct obligations issued by any state of
the United States of America or any political subdivision of any such state or
any public instrumentality thereof maturing within one (1) year from the date of
acquisition thereof and, at the time of acquisition, having the highest rating
obtainable from either S&P or Xxxxx'x, (iii) commercial paper maturing no more
than one (1) year from the date of creation thereof and, at the time of
acquisition, having a rating in one of the two highest rating categories of S&P
or Xxxxx'x, (iv) certificates of deposit, bankers acceptances or time deposits
maturing within one (1) year from the date of acquisition thereof issued by any
of the Banks, (v) certificates of deposit or bankers acceptances maturing within
one (1) year from the date of acquisition thereof or time deposits maturing
within thirty (30) days from the date of acquisition thereof issued by other
commercial banks organized under the laws of the United States of America or any
state thereof or the District of Columbia, each having shareholders' equity of
not less than $600,000,000, (vi) repurchase agreements with commercial banks or
with securities dealers, in any case fully secured as to principal and interests
by obligations described in clauses (i)-(v) of this Section, or (vii) joint
ventures or other non-Subsidiary enterprises in the same or closely related
lines of business in an aggregate amount up to ten percent (10%) of the book
value of consolidated assets of the Borrower and its Subsidiaries.
SECTION 5.15 Prepayments of Debt. The Borrower shall not, nor shall it
permit any of its Subsidiaries to, prepay, redeem, defease (whether actually or
in substance) or purchase in any manner (or deposit or set aside funds for the
purpose of any of the foregoing), make any payment in respect of principal of,
or make any payment in respect of interest on, or permit any of its Subsidiaries
to prepay, redeem, or purchase in an manner, make any payment in respect of
principal of, or make any payment in respect of interest on, any Debt of the
Borrower or any of its Subsidiaries except for (i) payments of principal,
interest or other sums required or permitted in accordance with the terms of the
instruments governing such Debt, (ii) payments with respect to Debt under this
Credit Agreement or any of the Financing Documents hereunder or under the
Revolving Credit Agreement or any of the Financing Documents thereunder, (iii)
payments with respect to Debt assumed or taken subject to in connection with any
Securities Transaction or asset purchase after the date hereof, (iv) payments
with respect to Debt of any Subsidiary to the Borrower and (v) payments and
prepayments on up to $60 million in principal amount of mortgage indebtedness
assumed in connection with the acquisition of Capstone Capital Corporation.
SECTION 5.16 Capital Expenditures. HRT shall not, nor shall it permit
any of its Subsidiaries to, make any capital expenditures in an aggregate amount
in excess of FIVE MILLION DOLLARS ($5,000,000) per fiscal year; provided,
however (i) capital expenditures incurred to acquire, expand or improve
facilities shall not be deemed to be capital expenditures for purposes of the
foregoing requirement, and (ii) capital expenditures required pursuant to any
lease or other contract shall not be deemed to be capital expenditures for
purposes of the foregoing requirement.
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SECTION 5.17 Repurchase, Retirement or Redemption of Capital Stock;
Dividends. HRT will not, nor will it permit any of its Subsidiaries (other than
its wholly-owned Subsidiaries or the Specified Affiliates) to, repurchase,
retire or redeem any of its capital stock. HRT will not pay dividends on any of
its stock in any fiscal year in excess of ninety five percent (95%) of Funds
From Operations for such fiscal year; provided that (I) any wholly-owned
Subsidiary may pay dividends or make distributions to its parent company and
(ii) the Borrower may pay such dividends as are necessary to maintain its status
as a REIT.
SECTION 5.18 Ratio of Consolidated Funded Indebtedness to Consolidated
Total Capital. HRT will not permit its ratio of Consolidated Funded Indebtedness
to Consolidated Total Capital to exceed (i) .42 to 1.0 as of the last day of
each fiscal quarter ending prior to December 31, 1999, and (ii) .40 to 1.0 as of
the last day of each fiscal quarter ending as of December 31, 1999 and
thereafter.
SECTION 5.19 Consolidated Tangible Net Worth. HRT shall maintain
Consolidated Tangible Net Worth at all times of at least $800,000,000.00;
provided, however, such amount shall be increased by an amount equal to (a)
ninety-five percent (95%) of the net proceeds received by HRT on account of any
additional equity offerings made subsequent to the Closing Date; and (b)
ninety-five percent (95%) of the net proceeds received by HRT on account of any
Securities Transaction completed subsequent to the Closing Date.
SECTION 5.20 Consolidated Interest Coverage Ratio. HRT will maintain a
ratio of Consolidated EBIT to Consolidated Interest Expense as of the last day
of each fiscal quarter (computed for the four (4) consecutive quarterly periods
then ending) based on the Duff & Xxxxxx rating for the Borrower's senior
unsecured (non-credit enhanced) long-term debt, of not less than:
Duff & Xxxxxx Rating
BBB or above 2.50 to 1.0
below BBB 3.00 to 1.0
SECTION 5.21 Consolidated Senior Secured Debt to Consolidated Total
Capital Ratio. The ratio of Consolidated Senior Secured Debt to Consolidated
Total Capital shall not at any time exceed .20 to 1.0.
SECTION 5.22 Consolidated Unencumbered Realty to Consolidated Unsecured
Debt Ratio. The ratio of Consolidated Unencumbered Realty to Consolidated
Unsecured Debt shall not at any time be less than 2.1 to 1.0.
SECTION 5.23 Material Subsidiaries. The Borrower will give the Agent
prompt notice of any Subsidiary of the Borrower which to the Borrower's
knowledge becomes a Material Subsidiary subsequent to the Closing Date and will
take the following steps with respect to each such Material Subsidiary: (i) the
Borrower will cause each such Material Subsidiary to execute a guaranty in favor
of the Banks in respect of the Tranche A Term Loan or the Tranche B Term Loan,
or both, as appropriate, in the form of Schedule 5.09 attached hereto and (ii)
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the Borrower will pay all reasonable costs and expenses incurred in connection
with the requirements set forth in this Section 5.23. The Borrower will satisfy
the foregoing requirements within thirty (30) days after any Subsidiary becomes
a Material Subsidiary.
SECTION 5.24 Specified Affiliates. The Borrower will take the following
steps with respect to each Specified Affiliate: (i) the Borrower will cause each
Specified Affiliate to execute a guaranty in favor of the Banks in the form of
Schedule 5.09 attached hereto and (ii) the Borrower will pay all reasonable
costs and expenses incurred in connection with the requirements set forth in
this Section 5.24. The Borrower will satisfy the foregoing requirements within
thirty (30) days after the creation of any Specified Affiliate.
SECTION 5.25 REIT Status. HRT will meet the requirements of Section
857(a) of the Code and regulations thereunder.
SECTION 5.26 Leases. HRT will not modify or amend any lease where the
Borrower is the lessor thereunder if such modification or amendment would have a
material adverse effect on the Borrower.
SECTION 5.27 Year 2000 Compliance. The Borrower will promptly notify
the Bank in the event the Borrower discovers or determines that any computer
application (including those of its suppliers, vendors and customers) that is
material to its or any of its Subsidiaries' business and operations will not be
Year 2000 compliant, except to the extent that such failure could not reasonably
be expected to have a Material Adverse Effect.
SECTION 5.28 Construction and Development. HRT and its Subsidiaries
will not engage in construction and development projects in which the total
project costs of all such concurrent construction and development projects
exceed, in the aggregate at any one time, ten percent (10%) of the book value of
consolidated assets of the Borrower and its Subsidiaries (it being understood
and agreed for purposes of this Section that a project shall be considered under
construction and/or development until a certificate of occupancy therefor, or
other similar certificate, shall have been issued by appropriate governmental
authorities).
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01 Events of Default. The occurrence of any of the following
events shall constitute an event of default hereunder (individually, an "Event
of Default" and collectively the "Events of Default"):
(a) The Borrowers shall fail to pay (i) when due any principal of any
Loan or (ii) within five (5) days after the same shall become due, any interest
on any Obligation or any fees or any other amount payable hereunder;
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(b) The Borrowers shall fail to observe or perform any covenant
contained in Section 5.01 hereof for thirty (30) days after the earlier of a
responsible officer of the Borrower becoming aware of such failure or written
notice of such failure shall have been given to the Borrower by the Agent or any
Bank;
(c) Default in the due performance or observance of any term, covenant
or agreement contained in Section 5.07 through 5.28, inclusive;
(d) Any Obligor shall fail to observe or perform any covenant or
agreement contained in any Financing Document (other than those covered by
clause (a), (b) or (c) above) for thirty (30) days after the earlier of a
responsible officer of the Borrower becoming aware of such failure or written
notice of such failure shall have been given to the Borrower by the Agent or any
Bank;
(e) Any representation, warranty, certification or statement made or
deemed made by any Obligor in any Financing Document or in any certificate,
financial statement or other document delivered pursuant thereto shall prove to
have been incorrect in any material respect when made (or deemed made) and such
representation, warranty, certification or statement shall remain incorrect for
thirty (30) days after written notice of such failure shall have been given to
the Borrower by the Agent or any Bank;
(f) Either of the Borrowers or any of their Subsidiaries shall fail to
make any payment in respect of any Debt in an aggregate amount in excess of
$5,000,000 when due or within any applicable grace period;
(g) Any event or condition shall occur which would cause or permit the
acceleration of the maturity of any Debt of either of the Borrowers or any
Subsidiary in an aggregate amount in excess of $5,000,000 or enables the holder
of such Debt or any Person acting on such holder's behalf to accelerate the
maturity thereof;
(h) Either of the Borrowers or any Guarantor shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing;
(i) An involuntary case or other proceeding shall be commenced against
either of the Borrowers or any Guarantor seeking liquidation, reorganization or
other relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of thirty (30) days; or an
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order for relief shall be entered against either of the Borrowers or any
Guarantor under the federal bankruptcy laws as now or hereafter in effect;
(j) Either of the Borrowers or any Guarantor shall admit in writing its
inability to pay its debts as and when they fall due;
(k) Except as previously disclosed to the Banks in writing prior to the
date hereof: any member of the ERISA Group shall fail to pay when due an amount
or amounts aggregating in excess of $1,000,000 which it shall have become liable
to pay under Title IV of ERISA; or notice of intent to terminate any Plan which
is then a Material Plan shall be filed under Title IV of ERISA by any member of
the ERISA Group, any plan administrator or any combination of the foregoing; or
the PBGC shall institute proceedings under Title IV of ERISA to terminate, to
impose liability (other than for premiums under Section 4007 of ERISA) in
respect of, or to cause a trustee to be appointed to administer any Plan which
is then a Material Plan; or a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that any Plan which is then a
Material Plan must be terminated; or there shall occur a complete or partial
withdrawal from, or a default, within the meaning of Section 4219(c)(5) of
ERISA, with respect to, one or more Multiemployer Plans which could cause one or
more members of the ERISA Group to incur a current payment obligation, that is,
an obligation or series of obligations payable within twelve (12) months, in
excess of $1,000,000;
(k) An uninsured, final, unappealable judgment or order for the payment
of money in excess of $1,000,000 shall be rendered against either of the
Borrowers or any of their Subsidiaries and such judgment or order shall continue
unsatisfied and unstayed for a period of thirty (30) days;
(l) (i) The voting interests in any Specified Affiliate shall be held
by a Person other than a director, officer or employee of HRT, (ii) HRT shall
fail to own substantially all of the economic interest in any Specified
Affiliate and the remainder of such economic interest shall be held by a Person
other than directors, officers and/or employees or (iii) a Specified Affiliate
shall engage in any of the actions or activities that are limited or restricted
by Article 5 hereof;
(m) Except as to any which is dissolved, released or merged or
consolidated out of existence as the result of or in connection with a
dissolution, merger or consolidation permitted by Section 5.04, the guaranty
given by any Guarantor hereunder or any material provision thereof shall cease
to be in full force and effect, or any Guarantor hereunder or any Person acting
by or on behalf of such Guarantor shall deny or disaffirm such Guarantor's
obligations under such guaranty, or any Guarantor shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to any guaranty; or
(n) the occurrence of an Event of Default under the Revolving Credit
Agreement;
(o) the occurrence of a Change of Control;
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then, and in every such event, the Agent shall during the continuance of such
Event of Default (i) if requested by the Majority Banks, by notice to the
Borrowers terminate the Commitments, (ii) if requested by the Majority Banks, by
notice to the Borrowers declare the Notes (together with accrued interest
thereon) and all other amounts payable by the Borrower hereunder to be, and such
Notes and amounts shall thereupon become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrowers, (iii) provide cash collateral in respect of the
LOC Obligations, and (iv) take such other actions as are directed by the
Majority Banks; provided that in the case of any Event of Acceleration, without
any notice to any Obligor or any other act by the Agent or any Bank, the
Commitments shall automatically terminate and the Notes (together with accrued
interest thereon) shall automatically become immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrowers; and provided further that the Agent may
terminate commitments and declare the Loans and Obligations hereunder
immediately due and payable without prior notice to or the consent of the Banks
where it determines such action is warranted and appropriate based on the facts
and circumstances. Subject to the request or direction of the Majority Banks as
provided above, Agent shall have the exclusive right to enforce the remedies
available under this Credit Agreement during the continuance of any Event of
Default hereunder
ARTICLE VII
THE AGENT
SECTION 7.01 Appointment and Authorization. Each Bank appoints the
Agent to act as its agent in connection herewith and each of the other Financing
Documents.
SECTION 7.02 Agents and Affiliates. NationsBank shall have the same
rights and powers under this Credit Agreement as any other Bank and may exercise
or refrain from exercising the same as though it were not the Agent, and
NationsBank and each of its affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with the Borrowers, any of their
Subsidiaries and any of their respective Affiliates as if it were not the Agent.
SECTION 7.03 Action by Agent. The obligations of the Agent under the
Financing Documents are only those expressly set forth herein with respect to
it. Without limiting the generality of the foregoing the Agent shall not be
required to take any action with respect to any Default or Event of Default,
except as expressly provided in Article VI.
SECTION 7.04 Consultation with Experts. The Agent may consult with
legal counsel (who may be counsel for the Borrower), independent public
accountants and other experts selected by the Agent and shall not be liable for
any action taken or omitted to be taken by the Agent in good faith in accordance
with the advice of such counsel, accountants or experts.
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SECTION 7.05 Liability of Agent. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
not taken by it in connection with the Financing Documents (a) with the consent
or at the request of the Majority Banks; or (b) in the absence of gross
negligence or willful misconduct of the Agent. In requests for consents and
direction from the Banks the Agent may provide reasonable periods in which to
respond. Neither the Agent nor any of its directors, officers, agents or
employees shall be responsible for or have any duty to ascertain, inquire into
or verify (i) any statement, warranty or representation made in connection with
any Financing Document; (ii) the performance or observance of any of the
covenants or agreements of the Borrower, (iii) the satisfaction of any condition
specified in Article III, except receipt of items required to be delivered to
the Agent; or (iv) the validity, effectiveness or genuineness of any Financing
Document or any other instrument or writing furnished in connection therewith.
The Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement or other writing (which may be a bank wire,
facsimile, telex or similar writing) believed by it to be genuine or to be
signed by the proper party or parties.
SECTION 7.06 Indemnification. Each Bank shall, ratably in accordance
with its Commitment, indemnify the Agent and NMS (to the extent not reimbursed
by the Borrower) against any cost, expense (including reasonable counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
result from the Agent's or NMS's gross negligence or willful misconduct) that
the Agent may suffer or incur in connection with the Financing Documents or any
action taken or omitted by the Agent thereunder.
SECTION 7.07 Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Credit Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under the Financing Documents.
SECTION 7.08 Successor Agent. The Agent may resign at any time by
giving thirty (30) days prior written notice thereof to the Banks and the
Borrowers. The Majority Banks may remove the Agent for cause at any time by
giving thirty (30) days prior written notice to the Agent, the other Banks and
the Borrowers. Upon any such resignation or removal of the Agent, the Majority
Banks shall have the right to appoint a successor Agent, with the consent of the
Borrowers (which consent shall not unreasonably be withheld, but which may in
any event be withheld if (a) the Borrowers in good faith conclude that the
appointment of such proposed successor Agent could result in a violation of any
law, rule, guideline or regulation, or a violation of, revocation of, failure to
renew or modification of any order, facility security clearance or permit or (b)
the credit standing of the proposed successor Agent is lower than that of the
preceding Agent); provided, however, such consent of the Borrowers shall not be
required upon the occurrence and during the continuance of an Event of Default.
If no successor Agent shall have been so appointed by the Majority Banks, and
shall have accepted such appointment, within thirty (30) days after the retiring
Agent gives notice of resignation, then the retiring Agent may, on behalf of the
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Banks and with the consent of the Borrowers (which consent shall not be
unreasonably withheld except as aforesaid), appoint a successor Agent, which
shall have core capital of at least $500,000,000. Upon the acceptance of its
appointment as Agent hereunder by a successor Agent the retiring Agent shall be
discharged from its duties and obligations hereunder. After any retiring Agent's
resignation hereunder as Agent, the provisions of this Article shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Agent. In the event of any successor agent to NationsBank, (i) all references
herein to NationsBank shall be deemed to refer to such successor agent and (ii)
all references to Charlotte, North Carolina shall be deemed to mean the city in
which the successor Agent's headquarters is located.
SECTION 7.09 Agent's Fee. The Borrowers shall pay to the Agent for its
own account fees in the amounts and at the time previously agreed upon in
writing between the Borrowers and the Agent (with appropriate credit for agency
fees paid in advance in respect of the credit facility replaced hereby).
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01 Basis for Determining Interest Rate Inadequate or Unfair.
If on or prior to the first day of any Interest Period for any Eurodollar Loan:
(a) the Agent is advised by the Eurodollar Reference Bank that deposits
in Dollars (in the applicable amounts) are not being offered to the Eurodollar
Reference Bank in the relevant market for such Interest Period, or
(b) the Majority Banks advise the Agent that the Adjusted Eurodollar
Rate as determined by the Agent will not adequately and fairly reflect the cost
to such Banks of funding their Eurodollar Loans for such Interest Period, the
Agent shall forthwith give notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, (i) the obligations of the Banks to
make new Eurodollar Loans or to convert outstanding Loans into Eurodollar Loans
shall be suspended and (ii) each outstanding Eurodollar Loan, as the case may
be, shall be converted into a Base Rate Loan on the last day of the then current
Interest Period applicable thereto. Unless the Borrower notifies the Agent at
least one (1) Business Day before the date of any Eurodollar Borrowing for which
a Notice of Borrowing has previously been given that it elects not to borrow on
such date, such Borrowing shall instead be made as a Base Rate Borrowing.
SECTION 8.02 Illegality. If, on or after the date of this Credit
Agreement, the adoption of any applicable law, rule or regulation, or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof or compliance by any Bank (or its
Eurodollar Lending Office) with any request or directive (whether or not having
-49-
the force of law) of any such authority, central bank or comparable agency shall
make it unlawful or impossible for any Bank (or its Eurodollar Lending Office)
to make, maintain or fund its Eurodollar Loans and such Bank shall so notify the
Agent, the Agent shall forthwith give notice thereof to the other Banks and the
Borrower, whereupon until such Bank notifies the Borrower and the Agent that the
circumstances giving rise to such suspension no longer exist, the obligation of
such Bank to make new Eurodollar Loans, or to convert outstanding Loans into
Eurodollar Loans, shall be suspended. Before giving any notice to the Agent
pursuant to this Section, such Bank shall designate a different Eurodollar
Lending Office if such designation will avoid the need for giving such notice
and will not, in the judgment of such Bank, be otherwise disadvantageous to such
Bank. If such notice is given, each Eurodollar Loan of such Bank then
outstanding shall be converted to a Base Rate Loan either (a) on the last day of
the then current Interest Period applicable to such Eurodollar Loan if such Bank
may lawfully continue to maintain and fund such Loan to such day or (b)
immediately if such Bank shall determine that it may not lawfully continue to
maintain and fund such Loan to such day.
SECTION 8.03 Increased Cost and Reduced Return.
(a) If on or after the date hereof, the adoption of any applicable law,
rule or regulation, or any change therein, or any change in the interpretation
or administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Bank (or its Eurodollar Lending Office) with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency:
(i) shall subject any Bank (or its Applicable Lending
Office) to any tax, duty or other charge with respect to its Eurodollar
Loans, or its obligation to make Eurodollar Loans, or shall change the
basis of taxation of payments to any Bank (or its Eurodollar Lending
Office) of the principal of or interest on its Eurodollar Loans or any
other amounts due under this Credit Agreement in respect of its
Eurodollar Loans or its obligation to make Eurodollar Loans (except for
(i) Non-Excluded Taxes covered by Section 8.04 (Including Non-Excluded
Taxes imposed solely by reason of any failure of such banks to comply
with its obligations under Section 2.14) and (ii) changes in the rate
of tax imposed on, or contemplated with respect to, the income of such
Bank or its Eurodollar Lending Office or changes generally affecting
the manner in which the income of such Bank or its Applicable Lending
Office is subjected to taxation, by the jurisdiction in which such
Bank's principal executive office or Eurodollar Lending Office is
located or the jurisdiction under the laws of which such Bank is
organized); or
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal
Reserve System, but excluding with respect to any Eurodollar Loan any
such requirement included in an applicable Eurodollar Reserve
Percentage) against assets of, deposits with or for the account of, or
credit extended by, any Bank (or its Applicable Lending Office) or
shall impose on any Bank (or its Applicable Lending Office) or on the
United States market for certificates of deposit or the London
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interbank market any other condition affecting its Eurodollar Loans,
its Note or its obligation to make Eurodollar Loans;
and the result of any of the foregoing is to increase the cost to such Bank (or
its Eurodollar Lending Office) of making or maintaining any Eurodollar Loan, or
to reduce the amount of any sum received or receivable by such Bank (or its
Eurodollar Lending Office) under this Credit Agreement or under its Note with
respect thereto, by an amount deemed by such Bank to be material (except to the
extent that such increased cost or reduction of a sum received or receivable is
attributable to such Bank's failure to perform any of its obligations under
Section 2.14 or is otherwise attributable to any act or action of such Bank
other than the loaning of funds under this Credit Agreement), then, within
fifteen (15) days after demand by such Bank (with a copy to the Agent)
accompanied by a certificate setting forth in reasonable detail its calculation
of such increased cost or reduction, the Borrower shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such increased
cost or reduction.
(b) If any Bank shall have determined that, after the date hereof, the
adoption or change of any applicable law, rule, guideline or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof or any request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on capital
of such Bank (or its Parent) as a consequence of such Bank's obligations
hereunder to a level below that which such Bank (or its Parent) could have
achieved but for such adoption, change, request or directive (taking into
consideration its policies with respect to capital adequacy) by an amount deemed
by such Bank to be material then from time to time, within fifteen (15) days
after demand by such Bank (with a copy to the Agent) accompanied by a
certificate setting forth in reasonable detail its calculation of such
reduction, the Borrower shall pay such Bank such additional amount or amounts as
will compensate such Bank (or its Parent) for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent of any
event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section and will designate a
different Applicable Lending Office if such designation will avoid the need for,
or reduce the amount of, such compensation and will not, in the judgment of such
Bank, be otherwise disadvantageous to such Bank. A certificate of any Bank
claiming compensation under this Section and setting forth in reasonable detail
its calculation of the additional amount or amounts to be paid to it hereunder
shall be conclusive in the absence of manifest error. In determining such
amount, such Bank may use any reasonable averaging and attribution methods.
Failure on the part of any Bank to demand compensation under subsection (a) or
(b) with respect to any period shall not constitute a waiver of such Bank's
right to demand compensation with respect to such period or any other period;
provided, however, that no Bank shall be entitled to compensation for the period
which is more than thirty (30) days prior to the date the Borrower receives the
certificate described in this subsection (c) via facsimile. Each Bank agrees
that it will send the certificate described above via facsimile to insure
immediate receipt by the Borrower.
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SECTION 8.04 Taxes.
(a) Except as provided below in this subsection, all payments made by
the Borrower under this Credit Agreement and any Notes shall be made free and
clear of, and without deduction or withholding for or on account of, any present
or future income, stamp or other taxes, levies, imposts, duties, charges, fees,
deductions or withholdings, now or hereafter imposed, levied, collected,
withheld or assessed by any court, or governmental body, agency or other
official, excluding taxes measured by or imposed upon the overall net income of
any Bank or its applicable lending office, or any branch or affiliate thereof,
and all franchise taxes, branch taxes, taxes on doing business or taxes on the
overall capital or net worth of any Bank or its applicable lending office, or
any branch or affiliate thereof, in each case imposed in lieu of net income
taxes, imposed: (i) by the jurisdiction under the laws of which such Bank,
applicable lending office, branch or affiliate is organized or is located, or in
which its principal executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii) by reason
of any connection between the jurisdiction imposing such tax and such Bank,
applicable lending office, branch or affiliate other than a connection arising
solely from such Bank having executed, delivered or performed its obligations,
or received payment under or enforced, this Credit Agreement or any Notes. If
any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings ("Non-Excluded Taxes") are required to be withheld from any
amounts payable to the Agent or any Bank hereunder or under any Notes, (A) the
amounts so payable to the Agent or such Bank shall be increased to the extent
necessary to yield to the Agent or such Bank (after payment of all Non-Excluded
Taxes) interest or any such other amounts payable hereunder at the rates or in
the amounts specified in this Credit Agreement and any Notes, provided, however,
that the Borrower shall be entitled to deduct and withhold any Non-Excluded
Taxes and shall not be required to increase any such amounts payable to any Bank
that is not organized under the laws of the United States of America or a state
thereof if such Bank fails to comply with the requirements of Section 2.14
whenever any Non-Excluded Taxes are payable by the Borrower, and (B) as promptly
as possible thereafter the Borrower shall send to the Agent for its own account
or for the account of such Bank, as the case may be, a certified copy of an
original official receipt received by the Borrower showing payment thereof. If
the Borrower fails to pay any Non-Excluded Taxes when due to the appropriate
taxing authority or fails to remit to the Agent the required receipts or other
required documentary evidence, the Borrower shall indemnify the Agent and the
Banks for any incremental taxes, interest or penalties that may become payable
by the Agent or any Bank as a result of any such failure. The agreements in this
subsection shall survive the termination of this Credit Agreement and the
payment of the Loans and all other amounts payable hereunder.
SECTION 8.05 Base Rate Loans Substituted for Affected Eurodollar Loans.
If (i) the obligation of any Bank to make or maintain Eurodollar Loans has been
suspended pursuant to Section 8.02 or (ii) any Bank has demanded compensation
under Section 8.03 and the Borrower shall by at least five (5) Eurodollar
Business Days' prior notice to such Bank through the Agent have elected that the
provisions of this Section shall apply to such Bank, then, unless and until such
Bank notifies the Borrower that the circumstances giving rise to such suspension
or demand for compensation no longer apply:
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(a) all Loans which would otherwise be made by such Bank as (or
continued as or converted into) Eurodollar Loans shall instead be Base Rate
Loans (on which interest and principal shall be payable contemporaneously with
the related Eurodollar Loans of the other Banks), and
(b) after each of its Eurodollar Loans has been repaid (or converted to
a Base Rate Loan), all payments of principal which would otherwise be applied to
repay such Eurodollar Loans shall be applied to repay its Base Rate Loans
instead.
If such Bank notifies the Borrower that the circumstances giving rise to such
notice no longer apply, unless Borrower elects otherwise, the principal amount
of each such Base Rate Loan shall be converted into a Eurodollar Loan on the
first day of the next succeeding Interest Period applicable to the related
Eurodollar Loan of the other Banks.
SECTION 8.06 Substitution of Bank. If (i) the obligation of any Bank to
make Eurodollar Loans has been suspended pursuant to Section 8.02 or (ii) any
Bank has demanded compensation under Section 8.03, the Borrower shall have the
right, with the assistance of the Agent, to seek a substitute bank or banks
reasonably satisfactory to the Agent and the Borrower (which may be one or more
of the Banks) to purchase the Note of such Bank and the interest of such Bank in
the Unused Fees and to assume the Commitment of such Bank for a purchase price
equal to all amounts payable to such Bank hereunder and under the Note, and the
Borrower, the Agent, such Bank and such substitute bank or banks shall execute
and deliver an appropriately completed Assignment and Assumption Agreement
pursuant to Section 9.06(c) hereof to effect the assignment of rights to and
assumption of obligations by such substitute bank or banks.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including bank wire, telex, facsimile
transmission or similar writing) and shall be given to such party: (a) in the
case of the Borrower and the Agent, at the address, facsimile number or telex
number set out below, and in the case of the Banks, at their respective address,
facsimile number or telex number set forth on Schedule 9.1 hereto or (b) at such
other address, facsimile number or telex number as such party may hereafter
specify for the purpose of notice to the Agent and the Borrower:
If to the Borrowers: Healthcare Realty Trust Incorporated
0000 Xxxx Xxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Treasurer
Phone: (000) 000-0000
Fax: (000) 000-0000
-00-
Xxxxxxxx Xxxxxxx Xxxxxxxxxxx
0000 Xxxx Xxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Vice President Finance
Phone: (000) 000-0000
Fax: (000) 000-0000
If to the Agent: NationsBank, N.A.
One Independence Center
000 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxx Roof
Agency Services
Phone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
NationsBank, N.A.
Xxx XxxxxxxXxxx Xxxxx
Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxx Xxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
Each such notice, request or other communication shall be effective (i) if given
by telex, when such telex is transmitted to the telex number specified in or
pursuant to this Section and the appropriate answerback is received, (ii) if
given by facsimile, when such facsimile is transmitted to the number specified
in or pursuant to this section, (iii) if given by mail, 72 hours after such
communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid or (iv) if given by any other means, when delivered at
the address specified in or pursuant to this Section; provided that notices to
the Agent or the Borrower or any Bank under Article II or Article VIII shall not
be effective until received.
SECTION 9.02 No Waivers. No failure or delay by the Agent or any Bank
in exercising any right, power or privilege hereunder or under any Note shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law.
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SECTION 9.03 Expenses.
(a) The Borrowers shall pay (i) all reasonable out-of-pocket expenses
of the Agent associated with the preparation and due diligence of the Loans,
including reasonable fees and disbursements of special counsel for the Agent
(but excluding administration and syndication costs), in connection with any
waiver or consent requested by Borrowers hereunder or any amendment hereof
requested by Borrowers or any Default hereunder, any waiver or consent hereunder
or any amendment hereof or any Default or alleged Default hereunder and (ii) if
an Event of Default occurs, all reasonable out-of-pocket expenses incurred by
the Agent and each Bank, including reasonable fees and disbursements of counsel
in connection with such Event of Default and work-out collection, bankruptcy,
insolvency and other enforcement proceedings resulting therefrom.
(b) The Borrowers shall indemnify and defend the Agent, NMS and each
other Bank and their respective directors, officers, agents, employees,
Subsidiaries and Affiliates (the "Indemnified Parties") from, and hold each of
them harmless against any and all losses, liabilities, claims, damages or
expenses incurred by any of them arising out of, by reason of or in connection
with this Credit Agreement (but excluding any such losses, liabilities, claims,
damages or expenses incurred by reason of (i) the gross negligence or willful
misconduct by the indemnitee, and/or (ii) any claim made by Agent, NMS or any
Bank against the other), including, but without limitation, amounts paid in
settlement, court costs, and fees and disbursements of no more than one separate
law firm acting as counsel for any or all of the parties indemnified hereunder,
in each case incurred in connection with any such investigation, litigation or
other proceedings; provided, that the Indemnified Parties shall be entitled to
reimbursement of the expenses of more than one separate law firm if the
Indemnified Parties, in their reasonable discretion, determine that a single law
firm would not be able to adequately represent the interests of the Indemnified
Parties in a matter. Notwithstanding the foregoing provisions of this paragraph
to the contrary, each Indemnified Party shall use its best efforts to mitigate
any losses, liabilities, claims, damages or expenses as to which it is entitled
to seek indemnity pursuant to the provisions hereof.
SECTION 9.04 Sharing of Set-Offs. Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive payment of
a proportion of the aggregate amount of principal and interest due with respect
to any Note held by it which is greater than the proportion received by any
other Bank in respect of the aggregate amount of principal and interest due with
respect to any Note held by such other Bank, the Bank receiving such
proportionately greater payment shall purchase such participation in the Notes
held by the other Banks, and such other adjustments shall be made, as may be
required so that all such payments of principal and interest with respect to the
Notes held by the Banks shall be shared by the Banks pro rata. The Borrowers
agree, to the fullest extent they may effectively do so under applicable law,
that any holder of a participation in a Note, whether or not acquired pursuant
to the foregoing arrangements, may exercise rights of set-off or counterclaim
and other rights with respect to such participation as fully as if such holder
of a participation were a direct creditor of the Borrower in the amount of such
participation.
-55-
SECTION 9.05 Amendments and Waivers. Any provision of this Credit
Agreement or any of the other Financing Documents may be modified, amended or
waived if, but only if, such modification, amendment or waiver is in writing and
is signed by the Borrowers and the Majority Banks (and, if the rights or duties
of the Agent are affected thereby, by the Agent); provided that no such
modification, amendment or waiver shall, unless signed by all the Banks, (a)
increase the Commitment of any Bank or subject any Bank to any additional
obligation, (b) reduce the principal of or rate of interest on any Loan or any
fees or other amounts payable to any Bank hereunder, (c) postpone the date fixed
for any scheduled payment of principal of or interest on any Loan or any fees
hereunder or for any scheduled reduction or termination of any Commitment, (d)
except as provided in Section 2.01(d), change the percentage of the Commitments
or of the aggregate unpaid principal amount of the Notes, or the number of
Banks, which shall be required for the Banks or any of them to take any action
under this Section or any other provision of this Credit Agreement or (e)
release all or substantially all of the Guarantors.
SECTION 9.06 Successors and Assigns.
(a) The provisions of this Credit Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns, except that the Borrowers may not assign or otherwise transfer any of
their rights or obligations under this Credit Agreement without the prior
written consent of all the Banks, and no Bank may assign or otherwise transfer
any of its rights or obligations under this Credit Agreement except in
compliance with this Section 9.06; provided that nothing contained herein shall
prevent or prohibit any Bank from (i) pledging its Loans and Obligations to a
Federal Reserve Bank in support of borrowings made by such Bank from such
Federal Reserve Bank, or (ii) granting assignments or selling participations in
such Bank's Obligations and/or Commitments hereunder to a parent company and/or
an Affiliate or Subsidiary of such Bank.
(b) Any Bank at any time may grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment or
any or all of its Loans. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to the
Borrowers and the Agent, such Bank shall remain responsible for the performance
of its obligations hereunder, and the Borrower and the Agent shall continue to
deal solely and directly with such Bank in connection with such Bank's rights
and obligations under this Credit Agreement. Any agreement pursuant to which any
Bank may grant such a participating interest shall provide that such Bank shall
retain the sole right and responsibility to enforce the obligations of the
Borrowers hereunder including, without limitation, the right to approve any
amendment, modification or waiver of any provision of the Financing Documents;
provided that such participation agreement may provide that such Bank will not
agree to any modification, amendment or waiver of this Credit Agreement
described in clause (a), (b) or (c) of Section 9.05, without the consent of the
Participant. An assignment or other transfer which is not permitted by
subsection (c) or (d) below shall be given effect for purposes of this Credit
Agreement only to the extent of a participating interest granted in accordance
with this subsection (b).
(c) Each Bank may assign all or a portion of its rights, obligations,
or rights and obligations hereunder (including, without limitation, its loans
-56-
and commitments hereunder) pursuant to an assignment agreement substantially in
the form of Schedule 9.06(c), to (i) a Bank, (ii) an affiliate of a Bank or
(iii) any other Person (other than the Borrowers or an Affiliate of the
Borrowers) reasonably acceptable to the Agent and, so long as no Default or
Event of Default has occurred and is continuing, the Borrowers, which consent
shall not be unreasonably withheld or delayed and which consent shall be deemed
given if the Borrower shall not make written objection within two Business Days
after notice of the proposed assignment; provided that (i) any such assignment
(other than an assignment to an existing Bank or affiliate of an existing Bank)
shall be in a minimum aggregate principal amount of $5,000,000 (or the remaining
amount of loans and commitments, if less) and integral multiples of $1,000,000
in excess thereof, and (ii) each such assignment shall be in a constant, not
varying, percentage of all the Bank's rights and obligations under this Credit
Agreement. Any assignment hereunder shall be effective upon delivery to the
Agent of written notice of the assignment together with a transfer fee of $3,500
payable to the Agent for its own account from and after the effective date
specified in the applicable assignment agreement. The assigning Bank will give
prompt notice to the Agent and the Borrower of any such assignment. Upon the
effectiveness of any such assignment (and after notice to, and (to the extent
required pursuant to the terms hereof), with the consent of, the Borrowers as
provided herein), the assignee shall become a "Bank" for all purposes of this
Credit Agreement and the other Financing Documents and, to the extent of such
assignment, the assigning Bank shall be relieved of its obligations hereunder to
the extent of the Obligations and Commitment components being assigned. Along
such lines the Borrowers agree that upon notice of any such assignment and
surrender of the appropriate Note or Notes, it will promptly provide to the
assigning Bank and to the assignee separate promissory notes in the amount of
their respective interests substantially in the form of the original Note (but
with notation thereon that it is given in substitution for and replacement of
the original Note or any replacement notes thereof). By executing and delivering
an assignment agreement in accordance with this Section 9.06(c), the assigning
Bank thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows: (i) such
assigning Bank warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim; (ii) except
as set forth in clause (i) above, such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Credit
Agreement, any of the other Financing Documents or any other instrument or
document furnished pursuant hereto or thereto, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Credit
Agreement, any of the other Financing Documents or any other instrument or
document furnished pursuant hereto or thereto or the financial condition of any
Obligor or any of their respective Affiliates or the performance or observance
by any Obligor of any of its obligations under this Credit Agreement, any of the
other Financing Documents or any other instrument or document furnished pursuant
hereto or thereto; (iii) such assignee represents and warrants that it is
legally authorized to enter into such assignment agreement; (iv) such assignee
confirms that it has received a copy of this Credit Agreement, the other
Financing Documents and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
assignment agreement; (v) such assignee will independently and without reliance
upon the Agent, such assigning Bank or any other Bank, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this Credit
Agreement and the other Financing Documents; (vi) such assignee appoints and
-57-
authorizes the Agent to take such action on its behalf and to exercise such
powers under this Credit Agreement or any other Financing Document as are
delegated to the Agent by the terms hereof or thereof, together with such powers
as are reasonably incidental thereto; and (vii) such assignee agrees that it
will perform in accordance with their terms all the obligations which by the
terms of this Credit Agreement and the other Financing Documents are required to
be performed by it as a Bank.
(d) Any Bank may at any time assign all or any portion of its rights
under this Credit Agreement and its Notes to a Federal Reserve Bank. No such
assignment shall release the transferor Bank from its obligations hereunder.
(e) The Borrowers agree that each Participant shall to the extent
provided in its participation agreement, be entitled to the benefits of Section
8.03 and 2.15 with respect to its participating interest; provided that no
Participant or other transferee of any Bank's rights shall be entitled to
receive any greater payment under Section 8.03 or 2.12 (whether individually or
in aggregate with any such payments received by such Bank) than such Bank would
have been entitled to receive with respect to the rights transferred if such
rights had not been transferred.
(f) The Borrowers shall not be required to pay any costs or expenses in
connection with any participation, assignment or transfer described in this
Section 9.06. No such participation or, except as provided in Section 9.06(c)
above with respect to an assignment which is consented to by Borrowers,
assignment or transfer shall release any Bank from liability for its obligations
hereunder.
SECTION 9.07 Collateral. Each of the Banks represents to the Borrowers,
the Agent and each of the other Banks that it in good faith is not relying upon
any "Margin Stock" (as defined in Regulation U) as collateral in the extension
or maintenance of the credit provided for in the Financing Documents.
SECTION 9.08 Governing Law; Submission to Jurisdiction. This Credit
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of North Carolina. The Borrowers, Agent and each Bank
hereby submit to the nonexclusive jurisdiction of the United States District
Court of the Western District of North Carolina and of any North Carolina State
court sitting in Charlotte for purposes of all legal proceedings arising out of
or relating to this Credit Agreement or the transactions contemplated hereby.
The Borrowers, Agent and each Bank irrevocably waive, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying
of the venue of any such proceeding brought in such a court and any claim that
any such proceeding brought in such a court has been brought in an inconvenient
forum.
SECTION 9.09 Counterparts; Integration; Effectiveness. This Credit
Agreement may be signed in any number of counterparts, each of which shall be an
original with the same effect as if the signatures thereto and hereto were upon
the same instrument. This Credit Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
-58-
hereof. This Credit Agreement shall become effective when the Agent shall have
received counterparts hereof signed by all of the parties hereto.
SECTION 9.10 WAIVER OF JURY TRIAL. EACH OF THE BORROWERS, THE AGENT AND
EACH BANK HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS CREDIT AGREEMENT, ANY
FINANCING DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
-59-
IN WITNESS WHEREOF, the parties hereto have caused this Term Loan
Credit Agreement to be duly executed by their respective authorized officers as
of the day and year first above written.
BORROWERS: HEALTHCARE REALTY TRUST
INCORPORATED, a Maryland
corporation
By:
Name:
Title:
CAPSTONE CAPITAL CORPORATION,
a Maryland corporation
By:
Name:
Title:
NATIONSBANK, N.A., in its capacit
as Agent and in its individual
capacity as a Bank
By:
Name:
Title:
Schedule 2.1
Schedule of Commitments
Tranche A Term Loan Tranche A Term Loan Tranche B Term Loan Tranche B Term Loan
Lender Committed Amount Commitment Percentage Committed Amount Commitment Percentage
------ ---------------- --------------------- ---------------- ---------------------
NationsBank, N.A.
$187,400,000 100.0000% $12,600,000 $100.0000%
Schedule 2.06(a)
FORM OF TRANCHE A TERM NOTE
October 15, 1998
FOR VALUE RECEIVED, the undersigned Borrower hereby promises to pay to
the order of ______________________, its successors and assigns, to the office
of the Agent in immediately available funds as provided in the Credit Agreement,
the principal amount of such Bank's Tranche A Term Loan in such amounts and on
such dates as provided in the Credit Agreement, together with interest thereon
at the rates and as provided in the Credit Agreement.
This Note is one of the Tranche A Term Notes referred to in the Term
Loan Credit Agreement dated as of October 15, 1998 (as amended and modified, the
"Credit Agreement") among HEALTHCARE REALTY TRUST INCORPORATED, a Maryland
corporation, CAPSTONE CAPITAL CORPORATION, a Maryland corporation, the Banks
identified therein and NationsBank, N.A., as Agent. Terms used but not otherwise
defined herein shall have the meanings provided in the Credit Agreement.
The holder may endorse and attach a schedule to reflect borrowings
evidenced by this Note and all payments and prepayments thereon; provided that
any failure to endorse such information shall not affect the obligation of the
undersigned Borrower to pay amounts evidenced hereby.
Upon the occurrence of an Event of Default, all amounts evidenced by
this Note may, or shall, become immediately due and payable as provided in the
Credit Agreement without presentment, demand, protest or notice of any kind, all
of which are waived by the undersigned Borrower. In the event payment of amounts
evidenced by this Note is not made at any stated or accelerated maturity, the
undersigned Borrower agrees to pay, in addition to principal and interest, all
costs of collection, including reasonable attorneys' fees.
This Note and the Loans and amounts evidenced hereby may be transferred
only as provided in the Credit Agreement.
This Note shall be governed by, and construed and interpreted in
accordance with, the law of the State of North Carolina.
In WITNESS WHEREOF, the undersigned Borrower has caused this Note to be
duly executed as of the date first above written.
HEALTHCARE REALTY TRUST INCORPORATED,
a Maryland corporation
By:______________________________
Name:
Title:
Schedule 2.06(b)
FORM OF TRANCHE B TERM NOTE
October 15, 1998
FOR VALUE RECEIVED, the undersigned Borrower hereby promises to pay to
the order of ______________________, its successors and assigns, to the office
of the Agent in immediately available funds as provided in the Credit Agreement,
the principal amount of such Bank's Tranche B Term Loan in such amounts and on
such dates as provided in the Credit Agreement, together with interest thereon
at the rates and as provided in the Credit Agreement.
This Note is one of the Tranche B Term Notes referred to in the Term
Loan Credit Agreement dated as of October 15, 1998 (as amended and modified, the
"Credit Agreement") among HEALTHCARE REALTY TRUST INCORPORATED, a Maryland
corporation, CAPSTONE CAPITAL CORPORATION, a Maryland corporation, the Banks
identified therein and NationsBank, N.A., as Agent. Terms used but not otherwise
defined herein shall have the meanings provided in the Credit Agreement.
The holder may endorse and attach a schedule to reflect borrowings
evidenced by this Note and all payments and prepayments thereon; provided that
any failure to endorse such information shall not affect the obligation of the
undersigned Borrower to pay amounts evidenced hereby.
Upon the occurrence of an Event of Default, all amounts evidenced by
this Note may, or shall, become immediately due and payable as provided in the
Credit Agreement without presentment, demand, protest or notice of any kind, all
of which are waived by the undersigned Borrower. In the event payment of amounts
evidenced by this Note is not made at any stated or accelerated maturity, the
undersigned Borrower agrees to pay, in addition to principal and interest, all
costs of collection, including reasonable attorneys' fees.
This Note and the Loans and amounts evidenced hereby may be transferred
only as provided in the Credit Agreement.
This Note shall be governed by, and construed and interpreted in
accordance with, the law of the State of North Carolina.
In WITNESS WHEREOF, the undersigned Borrower has caused this Note to be
duly executed as of the date first above written.
CAPSTONE CAPITAL CORPORATION,
a Maryland corporation
By: _______________________
Name:
Title:
-2-
Schedule 2.10
Form of Notice of Interest Rate Election
NationsBank, N.A.,
as Agent for the Banks
000 X. Xxxxx Xxxxxx
Independence Center, 15th Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Re: Term Loan Credit Agreement dated as of October 15, 1998 (as
amended and modified, the "Credit Agreement") among HEALTHCARE
REALTY TRUST INCORPORATED, and CAPSTONE CAPITAL CORPORATION,
the Banks identified therein and NationsBank, N.A., as Agent.
Terms used but not otherwise defined herein shall have the
meanings provided in the Credit Agreement.
Ladies and Gentlemen:
The undersigned hereby gives notice pursuant to Section 2.10 of the
Credit Agreement that it requests an extension or conversion of an existing loan
comprising a portion of the Term Loans outstanding under the Credit Agreement,
and in connection therewith sets forth below the terms on which such extension
or conversion is requested to be made:
________ Tranche A Term Loan
________ Tranche B Term Loan
(A) Date of Extension or Conversion
(which is the last day of the
applicable Interest Period) _______________________________
(B) Principal Amount of
Extension or Conversion _______________________________
(C) Interest rate basis _______________________________
(D) Interest Period and the
last day thereof _______________________________
In accordance with the requirements of the Credit Agreement, the
undersigned Borrower hereby certifies that:
(a) The representations and warranties contained in the Credit
Agreement and the other Credit Documents are true and correct in all
material respects as of the date of this request, and will be true and
correct after giving effect to the requested Extension of Credit
(except for those which expressly relate to an earlier date).
(b) No Default or Event of Default exists, or will exist after
giving effect to the requested Extension of Credit.
(c) All conditions set forth in Section 2.01 as to the making
of the Term Loan have been satisfied.
Very truly yours,
HEALTHCARE REALTY TRUST INCORPORATED
By:________________________________
Name:
Title:
CAPSTONE CAPITAL CORPORATION
By:________________________________
Name:
Title:
-2-
Schedule 4.04
Legal Proceedings
-3-
Schedule 4.05
ERISA Matters
-4-
Schedule 4.06
Environmental Matters
-5-
Schedule 4.07
Subsidiaries (including Material Subsidiaries and Specified Affiliates)
Material Subsidiaries:
Specified Affiliates:
Other Subsidiaries:
Other Affiliates:
-6-
Schedule 4.10
Compliance with Laws
-7-
Schedule 4.12
Debt
$300 million Revolving Loan Agreement dated as of the Closing Date with the
banks identified therein and NationsBank, N.A., as Agent.
$200 million Term Loan Agreement dated as of the Closing Date with the banks
identified therein and NationsBank, N.A., as Agent.
$90 million 7.41% Senior Notes of HRT due September 1, 2002.
-8-
Schedule 4.13
Contingent Liabilities
Subsidiary Guarantee dated as of the Closing Date in respect of the Revolving
Credit Agreement referenced on Schedule 4.12 given by the Subsidiaries and
affiliates identified therein.
Subsidiary Guarantee dated as of the Closing Date in respect of the Term Loan
Agreement referenced on Schedule 4.12 given by the Subsidiaries and affiliates
identified therein.
-9-
Schedule 4.14
Investments
-10-
Schedule 5.07
Liens
-11-
Schedule 5.08
Form of Subsidiary Guarantee
-12-
Schedule 9.01
Lender's Addresses
Address for Domestic Eurodollar
Lenders Notice Lending Office Lending Office
NationsBank, N.A. NationsBank, N.A. NationsBank, N.A. NationsBank, N.A.
000 X. Xxxxx Xxxxxx 000 X. Xxxxx Xxxxxx 000 X. Xxxxx Xxxxxx
Independence Center, 15th Floor Independence Center, 00xx Xxxxx Xxxxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Attn: Xxxx Roof Attn: Xxxx Roof Attn: Xxxx Roof
Tel: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000 Fax: 000-000-0000
with a copy to:
NationsBank, N.A.
Xxx XxxxxxxXxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxx
Tel: 000-000-0000
Fax: 000-000-0000
First Union First Union National Bank of Tennessee First Union National Bank First Union National Bank
National Bank 000 00xx Xxxxxx, 0xx Xxxxx Xxxxxxx Markets Service Dept. Capital Markets Service Dept.
Xxxxxxxxx, XX 00000 One First Xxxxx Xxxxxx, XX-0 Xxx Xxxxx Xxxxx Xxxxxx, XX-0
Attn: Xxxxxxx Xxxxxx 000 Xxxxx Xxxxxxx Xxxxxx 000 Xxxxx Xxxxxxx Xxxxxx
Tel: 000-000-0000 Charlotte, NC 28288-0785 Xxxxxxxxx, XX 00000-0000
Fax: 000-000-0000 Attn: Xxx Xxxxxxxxx Attn: Xxx Xxxxxxxxx
Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000
AmSouth Bank AmSouth Bank AmSouth Bank AmSouth Bank
000 Xxxxx Xxxxxx, Xxxxx 000 Relationship Banking Assistant Relationship Banking Assistant
Xxxxxxxxx, XX 00000 000 Xxxxx Xxxxxx, Xxxxx 000 000 Xxxxx Xxxxxx, Xxxxx 000
Attn: Xxxxx X. Wind Xxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Tel: 000-000-0000 Attn: Xxx Xxxxxxxxxx Attn: Xxx Xxxxxxxxxx
Fax: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000
Societe Generale Societe Generale Societe Generale Societe Generale
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000 0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000 0000 Xxxxxxx Xxxx Xxxx, Xxx 0000
Xxx Xxxxxxx, XX 00000 Xxx Xxxxxxx, XX 00000 Xxx Xxxxxxx, XX 00000
Attn: X. Xxxxxx Xxxxxxx Attn: Xxxxx Fun Attn: Xxxxx Fun
Tel: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000 Fax: 000-000-0000
Creditanstalt Creditanstalt Corporate Finance, Inc. Creditanstalt Corporate Finance,Inc. Creditanstalt Corporate Finance
Corporate Two Greenwich Plaza Two Ravinia Drive, Suite 1680 Two Ravinia Drive, Suite 1680
Finance, Inc. Greenwich, CT 06830-6353 Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
Attn: Xxxx Xxxxx Attn: Xxxxx Xxxx Attn: Xxxxx Xxxx
Tel: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000 Fax: 000-000-0000
SouthTrust Bank, SouthTrust Bank, N.A. SouthTrust Bank, N.A. SouthTrust Bank, N.A.
N.A. 000 Xxxxx 00xx Xxxxxx 0000 0xx Xxxxxx, Xxxxx 0000 0xx Xxxxxx, Xxxxx
Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
Attn: Xxxxx Xxx Attn: Operations Specialist Attn: Operations Specialist
Tel: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000 Fax: 000-000-0000
First Tennessee First Tennessee Bank National Association First Tennessee Bank National Assn. First Tennessee Bank Natl Assn
Bank National 000 Xxxxx Xxxxxx 000 Xxxxx Xxxxxx 000 Xxxxx Xxxxxx
Xxxxxxxxxxx Xxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Attn: J. Xxxx Xxxxxx Attn: Xxxxxxxx Xxxx Attn: Xxxxxxxx Xxxx
Tel: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000 Fax: 000-000-0000
-2-
Bank One, Bank One, Kentucky, NA Bank One, Kentucky, NA Bank One, Kentucky, NA
Kentucky, NA 000 Xxxx Xxxxxxxxx Xxxxxx 0 Xxxxxxxxxx Xxxxx 0 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000 KY1-4190 KY1-4190
Attn: Xxxx X. Xxxxxx Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
Tel: 000-000-0000 Attn: Sarilas Xxxxxx Attn: Sarilas Xxxxxx
Fax: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000
First Commercial First Commercial Bank First Commercial Bank First Commercial Bank
Bank 000 Xxxxxxx Xxxxx Xxxxxxx 000 Xxxxxx Xxxxx Xxxxxxx 000 Xxxxxx Xxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxxx Attn: Xxxxxxx XxXxxxxxxx Attn: Xxxxxxx XxXxxxxxxx
Tel: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000 Fax: 000-000-0000
Credit Lyonnais Credit Lyonnais New York Branch Credit Lyonnais New York Branch Credit Lyonnais New York Branch
New York Branch 1301 Avenue of the Americas 1301 Avenue of the Americas 0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxx Attn: Xxxxx X. Xxxxx Attn: Xxxxx X. Xxxxx
Tel: 000-000-0000 Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000 Fax: 000-000-0000
-3-
Schedule 9.06(c)
Form of Assignment and Acceptance
THIS ASSIGNMENT AND ACCEPTANCE dated as of , 199_ is entered into
between THE LENDER IDENTIFIED ON THE SIGNATURE PAGES AS THE "ASSIGNOR" (the
"Assignor") and THE PARTIES IDENTIFIED ON THE SIGNATURE PAGES AS "ASSIGNEES"
("Assignee").
Reference is made to that Credit Agreement dated as of October 15, 1998
(as amended and modified, the "Credit Agreement") among HEALTHCARE REALTY TRUST
INCORPORATED, a Maryland corporation and CAPSTONE CAPITAL CORPORATION, a
Maryland corporation (the "Borrowers"), the Banks identified therein and
NationsBank, N.A., as Agent. Terms defined in the Credit Agreement are used
herein with the same meanings.
1. The Assignor hereby sells and assigns, without recourse, to the
Assignees, and the Assignees hereby purchase and assume, without recourse, from
the Assignor, effective as of the Effective Date shown below, those rights and
interests of the Assignor under the Credit Agreement identified below (the
"Assigned Interests"), including the Obligations and Commitments relating
thereto, together with unpaid interest and fees relating thereto accruing from
the Effective Date. The Assignor represents and warrants that it owns interests
assigned hereby free and clear of liens, encumbrances or other claims. Each of
the Assignees represents that it is an assignee permitted under the Credit
Agreement. The Assignor and each of the Assignees hereby makes and agrees to be
bound by all the representations, warranties and agreements set forth in Section
9.06 of the Credit Agreement, a copy of which has been received by each such
party. From and after the Effective Date (i) each Assignee, if it is not already
a Bank under the Credit Agreement, shall be a party to and be bound by the
provisions of the Credit Agreement and, to the extent of the interests assigned
by this Assignment and Acceptance, have the rights and obligations of a Bank
thereunder and (ii) each Assignor shall, to the extent of the interests assigned
by this Assignment and Acceptance, relinquish its rights and be released from
its obligations under the Credit Agreement (other than the rights of
indemnification referenced in Section 9.03 of the Credit Agreement). Schedule
2.1 is deemed modified and amended to the extent necessary to give effect to
this Assignment.
2. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of North Carolina.
3. Terms of Assignment
(a) Date of Assignment: , 199__
--------------------------
(b) Legal Name of Assignor: SEE SIGNATURE PAGE
(c) Legal Name of Assignee: SEE SIGNATURE PAGE
(d) Effective Date of Assignment: , 199__
--------------------------
See Schedule I attached for a description of the Loans, Obligations and
Commitments (and the percentage interests therein and relating thereto) which
are the subject of this Assignment and Acceptance.
4. The fee payable to the Agent in connection with this Assignment is
enclosed.
IN WITNESS WHEREOF, the parties hereto have caused the execution of
this instrument by their duly authorized officers as of the date first above
written.
ASSIGNOR: ASSIGNEE:
By: _______________________ By: ______________________
Name: Name:
Title: Title:
Address for Notices:
ACKNOWLEDGMENT AND CONSENT
NATIONSBANK, N.A. HEALTHCARE REALTY TRUST INCORPORATED
as Agent
By: ____________________________ By: _______________________________
Name: Name:
Title: Title:
CAPSTONE CAPITAL CORPORATION
By:________________________________
Name:
Title:
SCHEDULE I
TO ASSIGNMENT AND ACCEPTANCE
HEALTHCARE REALTY TRUST INCORPORATED
TERM LOANS PRIOR TO ASSIGNMENT
Tranche A Tranche A Tranche B Tranche B
Term Loan Term Loan Tranche A Term Loan Term Loan Tranche B
Committed Commitment Term Loans Committed Commitment Term Loans
Amount Percentage Outstanding Amount Percentage Outstanding
--------- ---------- ----------- ---------- ---------- -----------
ASSIGNOR
ASSIGNEES
---------- ---------- ----------- ---------- ---------- ----------
$ % $ $ % $
TERM LOANS INTERESTS SUBJECT TO THIS ASSIGNMENT
Tranche A Tranche A Tranche B Tranche B
Term Loan Term Loan Tranche A Term Loan Term Loan Tranche B
Committed Commitment Term Loans Committed Commitment Term Loans
Amount Percentage Outstanding Amount Percentage Outstanding
--------- ---------- ----------- ---------- ---------- -----------
ASSIGNOR
ASSIGNEES
---------- ---------- ----------- ---------- ---------- ----------
$ % $ $ % $
SCHEDULE I
TO ASSIGNMENT AND ACCEPTANCE
HEALTHCARE REALTY TRUST INCORPORATED
TERM LOANS AFTER ASSIGNMENT
Tranche A Tranche A Tranche B Tranche B
Term Loan Term Loan Tranche A Term Loan Term Loan Tranche B
Committed Commitment Term Loans Committed Commitment Term Loans
Amount Percentage Outstanding Amount Percentage Outstanding
--------- ---------- ----------- ---------- ---------- -----------
ASSIGNOR
ASSIGNEES
---------- ---------- ----------- ---------- ---------- ----------
$ % $ $ % $
