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$25,000,000
REVOLVING LOAN AGREEMENT
by and among
CAPITAL LEASE FUNDING, INC.
and
CAPLEASE SERVICES CORP.
and
CAPLEASE, LP,
as Borrowers,
and
WACHOVIA INVESTMENT HOLDINGS, LLC,
in its respective capacities
as Initial Lender and as Administrative Agent
Dated as of August 26, 2005
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONAL PROVISIONS....................................................................1
Section 1.01 Definitions.......................................................................1
Section 1.02 Other Definitional Provisions....................................................18
Section 1.03 Accounting Terms.................................................................19
Section 1.04 Computation of Time Periods......................................................19
ARTICLE II THE LOANS; AMOUNT AND TERMS...............................................................19
Section 2.01 Loans............................................................................19
Section 2.02 Payments to Collection Account...................................................21
Section 2.03 Prepayments......................................................................22
Section 2.04 Default Rate and Payment Dates...................................................23
Section 2.05 Computation of Interest and Fees.................................................24
Section 2.06 Pro Rata Treatment and Payments..................................................24
Section 2.07 Non-Receipt of Funds by the Administrative Agent.................................26
Section 2.08 Inability to Determine Interest Rate.............................................27
Section 2.09 Illegality.......................................................................27
Section 2.10 Requirements of Law..............................................................28
Section 2.11 Indemnity........................................................................29
Section 2.12 Taxes............................................................................29
ARTICLE III CONDITIONS PRECEDENT......................................................................31
Section 3.01 Conditions to Closing Date.......................................................31
Section 3.02 Conditions to All Extensions of Credit...........................................35
ARTICLE IV REPRESENTATIONS AND WARRANTIES............................................................36
Section 4.01 Representations and Warranties...................................................36
ARTICLE V COVENANTS.................................................................................39
Section 5.01 Applied Covenants................................................................40
Section 5.02 Pledged Assets...................................................................40
Section 5.03 Financial Covenants..............................................................40
Section 5.04 Certificates; Other Information..................................................40
Section 5.05 No Other Negative Pledge.........................................................41
Section 5.06 Escrowed Funds...................................................................41
Section 5.07 Recourse Loans...................................................................41
ARTICLE VI EVENTS OF DEFAULT.........................................................................41
Section 6.01 Events of Default................................................................41
Section 6.02 Acceleration; Remedies...........................................................44
Section 6.03 Notice of Default................................................................44
Section 6.04 Non-Reliance on Administrative Agent and Other Lenders...........................44
Section 6.05 Indemnification..................................................................45
Section 6.06 The Administrative Agent in Its Individual Capacity..............................45
Section 6.07 Successor Administrative Agent...................................................46
Section 6.08 Other Agents.....................................................................46
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TABLE OF CONTENTS
(continued)
Page
ARTICLE VII THE ADMINISTRATIVE AGENT..................................................................47
Section 7.01 Appointment......................................................................47
Section 7.02 Delegation of Duties.............................................................47
Section 7.03 Exculpatory Provisions...........................................................47
Section 7.04 Reliance by Administrative Agent.................................................48
ARTICLE VIII JOINT AND SEVERAL LIABILITY...............................................................48
Section 8.01 Joint and Several Liability; Full Recourse Obligations...........................48
ARTICLE IX MISCELLANEOUS.............................................................................50
Section 9.01 Amendments, Waivers and Release of Collateral....................................50
Section 9.02 Survival of Representations and Warranties.......................................53
Section 9.03 Successors and Assigns; Participations; Purchasing Lenders.......................53
Section 9.04 Adjustments......................................................................56
Section 9.05 Indemnification and Expenses.....................................................56
Section 9.06 Notices and Other Communications.................................................57
Section 9.07 Entire Agreement; Severability...................................................58
Section 9.08 GOVERNING LAW....................................................................58
Section 9.09 SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL..........................58
Section 9.10 Periodic Due Diligence Review....................................................60
Section 9.11 Termination of Repurchase Agreement; Extension of Term...........................60
Section 9.12 Legal Matters....................................................................60
Section 9.13 Confidentiality..................................................................61
Section 9.14 Right of Set-off.................................................................61
Section 9.15 Treatment of Certain Information.................................................62
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SCHEDULES
Schedule 1.01(B) Lenders and Commitments
Schedule 3.01(e) Applicable Premium
Schedule 3.01(h) Organizational Chart of the Borrowers
EXHIBITS
Exhibit A Form of Revolving Note
Exhibit B Form of Commitment Transfer Supplement
Exhibit C Form of SPE Organizational Documents
Exhibit D Form of Pledge and Security Agreement
Exhibit E Form of Closing Certificate
Exhibit F Form of Deposit Account Control Agreement
Exhibit G Form of Solvency Certificate
Exhibit H Form of Compliance Certificate
Exhibit I Form of Negative Pledge Agreement
Exhibit J Form of Notice of Borrowing
Exhibit K Form of 2.12 Certificate
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REVOLVING LOAN AGREEMENT
THIS REVOLVING LOAN AGREEMENT, dated as of August 26, 2005 (this "Loan
Agreement"), among CAPLEASE SERVICES CORP., a Delaware corporation ("Services"),
CAPITAL LEASE FUNDING, INC., a Maryland corporation ("Parent"), Caplease, LP, a
Delaware limited partnership ("CapLease," and together with Parent and Services,
the "Borrowers") and WACHOVIA INVESTMENT HOLDINGS, LLC, in its capacity as the
initial Lender ("Initial Lender") and as administrative agent for the financial
institutions and banks ("Lenders") party hereto from time to time (in such
capacity, the "Administrative Agent" or the "Agent").
W I T N E S S E T H:
WHEREAS, the Borrowers have requested, and the Initial Lender has agreed,
to extend certain credit facilities to the Borrowers on the terms and conditions
set forth herein;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, such parties
hereby agree as follows:
ARTICLE I
DEFINITIONAL PROVISIONS
Section 1.01 Definitions.
(a) As used herein, the following terms shall have the following
meanings (all terms defined in this Section 1.01 or in other provisions of this
Agreement in the singular shall have the same meanings when used in the plural
and vice versa).
"Act of Insolvency": With respect to any Person, (i) the filing of a
petition, commencing, or authorizing the commencement of any case or proceeding
under any bankruptcy, insolvency, reorganization, liquidation, dissolution or
similar law relating to the protection of creditors, or suffering any such
petition or proceeding to be commenced by another which is consented to, not
timely contested or results in entry of an order for relief; (ii) the seeking or
consenting to the appointment of a receiver, trustee, custodian or similar
official for such Person or any substantial part of the property of such Person;
(iii) the appointment of a receiver, conservator, or manager for such Person by
any governmental agency or authority having the jurisdiction to do so; (iv) the
making of a general assignment for the benefit of creditors; (v) the admission
by such Person of its inability to pay its debts or discharge its obligations as
they become due or mature; or (vi) that any governmental authority or agency or
any person, agency or entity acting under governmental authority shall have
taken any action to condemn, seize or appropriate, or to assume custody or
control of, all or any substantial part of the property of such Person, or shall
have taken any action to displace the management of such Person or to curtail
its authority in the conduct of the business of such Person.
"Adjusted EBITDA": For any Person, (i) EBITDA less (ii) Loss
Reserves for the applicable period.
"Adjustment Event": With respect to any Eligible Asset, the
occurrence of any of the following (each of which shall be deemed to adjust the
Purchase Price of any Eligible Asset by such amount as may be determined by
Agent exercising reasonable discretion): (a) any theft, loss, physical
destruction or damage, taking, condemnation or similar event; (b) the Fair
Market Value of any Eligible Asset is not supported or validated pursuant to a
FIRREA standard appraisal, as determined by the Agent in its sole discretion;
(c) any violation or noncompliance, or claim or allegation of violation of or
noncompliance with, any Environmental Laws, including, without limitation, by
any Person or Governmental Authority; (d) any default in or nonperformance of
any material obligations by any landlord or by any tenant leasing a material
portion of any Eligible Asset or the termination of any such tenant's lease; or
(e) any default in or nonperformance of obligations by any Person arising out of
or in connection with any construction, capital improvement or similar projects
or undertakings, including, without limitation, material cost overruns (solely
to the extent included by the Agent and/or the Initial Lender in evaluating the
initial Purchase Price of such Eligible Asset and extending credit in connection
with the financing or refinancing of such Purchase Price upon the terms and
conditions set forth in this Agreement).
"Advance Rate": Up to 25% of the Purchase Price of each Eligible
Asset.
"Affiliate": As to any Person, an "Affiliate" of such Person, as
such term is defined in the Bankruptcy Code.
"Agreement": This Loan Agreement, as amended, restated, amended and
restated and supplemented from time to time.
"ALTA": The American Land Title Association.
"Alternate Base Rate": The per annum rate of interest equal to the
greater of (a) the prime rate or (b) the federal funds rate plus one half of one
percent (0.5%). Any change in the Alternate Base Rate resulting from a change in
the prime rate or the federal funds rate shall become effective as of 12:01 a.m.
on the business day on which each such change occurs. The Alternate Base Rate is
a reference rate used by the Agent in determining interest rates on certain
loans and is not intended to be the lowest rate of interest charged by the Agent
or any other Lender on any extension of credit to any Borrower.
"Alternate Base Rate Loans": Loans the rate of interest applicable
to which is based on the Alternate Base Rate.
"Anti-Money Laundering Loans": The meaning specified in Section
4.01(q).
"Applicable Premium": The meaning specified in Schedule 3.01(e).
"Applied Covenants": The covenants of Parent and Caplease, as
applicable, set forth in Sections 9.01(a), (b), (c), (d), (e), (f), (i), (j),
(k), (n), (q), (r), (t), (u), (w) and (x) of the Repurchase Agreement.
"Approved Fund": With respect to any Lender that is a fund that
invests in bank loans, any other fund that invests in bank loans and is managed
by the same investment advisor as such Lender or by an affiliate of such
investment advisor.
"Bankruptcy Code": The United States Bankruptcy Code of 1978, as
amended from time to time.
"Borrowing Date": In respect of any Loan, the date such Loan is
made.
"Business Day": Any day other than a (i) Saturday or Sunday or (ii)
day on which banks in the State of North Carolina, the State of New York, the
District of Columbia, or the state in which any of the Agent or the Borrowers is
located is authorized or obligated by law or executive order to be closed.
"Capital Expenditures": For any Person during any period, without
duplication, the sum of (1) actual expenditures which are capitalized in
conformity with GAAP and (ii) all recurring reserve payments for capital
expenditures which are required of such Person under any other loan documents.
"Capitalized Lease Obligations": Obligations under a lease that are
required to be capitalized for financial reporting purposes in accordance with
GAAP. The amount of a Capitalized Lease Obligation is the capitalized amount of
such obligation as would be required to be reflected on the balance sheet
prepared in accordance with GAAP of the applicable Person as of the applicable
date.
"Caplease": Caplease, LP, a Delaware limited partnership.
"Cash and Cash Equivalents": (i) cash, (ii) direct obligations of
the United States Government, including without limitation, treasury bills,
notes and bonds, (iii) interest bearing or discounted obligations of Federal
agencies and government sponsored entities or pools of such instruments offered
by approved banks and dealers, including without limitation, Federal Home Loan
Mortgage Corporation participation sale certificates, Government National
Mortgage Association modified pass through certificates, Federal National
Mortgage Association bonds and notes, and Federal Farm Credit System securities,
(iv) time deposits, domestic and Eurodollar certificates of deposit, bankers'
acceptances, commercial paper rated at least A-1 by S&P and P-1 by Xxxxx'x
and/or guaranteed by a Person with an Aa1 rating by Xxxxx'x, an AA- rating by
S&P or better rated credit, floating rate notes, other money market instruments
and letters of credit each issued by approved banks (provided that the same
shall cease to be a "Cash or Cash Equivalent" if at any time any such bank shall
cease to be an approved bank), (v) obligations of domestic corporations,
including, without limitation, commercial paper, bonds, debentures and loan
participations, each of which is rated at least AA- by S&P and/or Aa1 by Xxxxx'x
and/or guaranteed by a Person with an Aa1 rating by Xxxxx'x and/or a AA- rating
by S&P or better rated credit, (vi) obligations issued by states and local
governments or their agencies, rated at least MIG-1 by Xxxxx'x and/or SP-1 by
S&P and/or guaranteed by an irrevocable letter of credit of an approved bank
(provided that the same shall cease to be a "Cash or Cash Equivalent" if at any
time any such bank shall cease to be an approved bank), (vii) repurchase
agreements with major banks and primary government security dealers fully
secured by the U.S. government or agency collateral equal to or exceeding the
principal amount on a daily basis and held in safekeeping, and (viii) real
estate loan pool participations, guaranteed by a Person with an AA- rating given
by S&P or Aa1 rating given by Xxxxx'x or better rated credit.
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"Change of Control": (a) 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 Interests of the Parent (or other
securities convertible into such Voting Interests) representing more than 50% of
the combined voting power of all Voting Interests of Parent, (b) Continuing
Directors shall cease for any reason to constitute a majority of the members of
the board of directors of the Parent then in office, (c) the sale, lease,
transfer, conveyance or other disposition (other than by way of merger or
consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Borrowers and their Subsidiaries taken as
a whole to any "person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Act of 1934) or (d) the adoption by the equity holders of the Parent
of a plan or proposal for the liquidation or dissolution of the Parent. As used
herein, "beneficial ownership" shall have the meaning provided in Rule 13d-3 of
the Securities and Exchange Commission under the Securities Act of 1934.
"Closing Certificate": A Closing Certificate, substantially in the
form attached hereto as Exhibit E, including all attachments and exhibits
thereto, which shall include a copy of: (a) if applicable, a copy of the escrow
instruction letters delivered by the buyer to the applicable title companies in
respect of the Eligible Asset acquisition; (b) an unrecorded copy of all deeds
evidencing title to and ownership of the Eligible Asset by an SPE Entity, in
recordable form; (c) any HUD-1 (or equivalent) settlement statements in respect
of such Eligible Asset acquisition; and (d) such other documentation as the
Administrative Agent may reasonably request.
"Code": The Internal Revenue Code of 1986, as amended from time to
time.
"Collateral": A collective reference to the collateral which is
identified in, and at any time covered by, the Security Documents or such other
collateral in which a security interest may be granted in favor of the Agent to
secure the Obligations.
"Collection Account": The meaning given to such term in Section
2.02.
"Commitment Period": The period of time commencing on the date
hereof and ending on the Business Day preceding the Termination Date.
"Commitment Transfer Supplement": A Commitment Transfer Supplement,
in substantially the form of Exhibit B.
"Compliance Certificate": A Compliance Certificate, in substantially
the form of Exhibit H, demonstrating compliance by the Borrowers and their
Subsidiaries as of the date of delivery thereof with the financial covenants
contained in Section 5.03 hereof and such other matters as are set forth
therein, in each case for the periods specified therein.
"Consolidated Total Assets": At any time, all amounts which would be
included as assets on a consolidated balance sheet of the Borrowers other than
(i) amounts owing to any Borrower from Affiliates, or from officers, employees,
partners, members, directors, shareholders or other Persons similarly affiliated
with any Borrower or their respective Affiliates, (ii) intangible assets
(including, without limitation, synthetic or derivative products and/or
positions) other than intangible assets arising from the allocation of the
purchase price on real property acquisitions, (iii) prepaid taxes and/or
expenses (which shall not include, for the avoidance of doubt, purchase price,
mortgage loan and other deposits and escrows), and (iv) assets which have not
yet been acquired but are consolidated under FIN 46. For the avoidance of doubt,
"Consolidated Total Assets" shall not be reduced by "accumulated depreciation
and amortization" on real estate investments.
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"Consolidated Total Liabilities": At any time, without duplication,
all amounts which would be included as liabilities on a consolidated balance
sheet of the Borrowers, plus all (i) Contingent Liabilities less any liabilities
under which the Borrowers or any Subsidiary are not obligated but are
consolidated under FIN 46 and (ii) Preferred Securities of any Subsidiary.
"Contingent Liabilities": Without duplication, all items that would
constitute "Contingent Obligations" as such term is defined under GAAP or
pursuant to the reporting requirements of Sections 13 and 15 of the Securities
Exchange Act of 1934, as amended.
"Continuing Director": Means (i) an individual who is a member of
the Parent's Board of Directors on the date hereof or (ii) any new director
whose appointment was approved by a majority of the persons who were already
Continuing Directors at the time of such appointment, election or approval.
"Costs": Any and all claims, damages, losses, liabilities, costs and
expenses (including, without limitation, attorneys' fees and disbursements).
"Debt Issuance": Means the issuance of any Indebtedness, including,
without limitation, Preferred Securities to the extent such Preferred Securities
constitute Indebtedness, including, without limitation, in accordance with
applicable federal or state Tax Laws, for borrowed money by the Borrowers or any
of their Subsidiaries.
"Debt Service": Means, for any period, the sum of (a) Interest
Expense of the Borrowers and their Subsidiaries determined on a consolidated
basis for such period, and (b) all regularly scheduled and required principal
payments made with respect to Indebtedness of the Borrowers and their
Subsidiaries during such period (other than principal payments made by Borrowers
and their Subsidiaries on collateralized debt obligations, repurchase
facilities, or other substantially similar arrangements), other than any
balloon, bullet, margin or similar principal payment which repays such
Indebtedness in full. Debt Service shall include a proportionate share of items
(a) and (b) of all Unconsolidated Affiliates.
"Default": Any of the events specified in Section 7.01, whether or
not any requirement for the giving of notice, the lapse of time, or both, or any
other condition, has been satisfied.
"Default Rate": The meaning given to such term in Section 2.04.
"Deposit Account Control Agreement": The Deposit Account Control
Agreement, in substantially the form attached hereto as Exhibit F.
"Derivatives Contract": Any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement. Not in limitation of the
foregoing, the term "Derivatives Contract" includes any and all transactions of
any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any international foreign
exchange master agreement, or any other master agreement, including any such
obligations or liabilities under any such master agreement.
"Derivatives Termination Value": In respect of any one or more
Derivatives Contracts, after taking into account the effect of any legally
enforceable netting agreement relating to such Derivatives Contracts, (a) for
any date on or after the date such Derivatives Contracts have been closed out
and termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in clause (a) the
amount(s) determined as the xxxx-to-market value(s) for such Derivatives
Contracts, as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such Derivatives
Contracts (which may include the Agent or any Lender).
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"Dollars" and "$": Lawful money of the United States of America.
"Due Diligence Review": The performance by the Agent of any or all
of the reviews permitted under Section 9.10 with respect to any or all of the
Purchased Assets, as reasonably desired by the Agent from time to time.
"EBITDA": With respect to a Person for any period: (a) net income
(or loss) of such Person for such period determined on a consolidated basis
(prior to any impact from minority interests and before deduction of preferred
dividends on preferred stock, if any, of Borrower), in accordance with GAAP,
plus the following (but only to the extent actually included in determination of
such net income (loss)): (i) income tax expense; (ii) extraordinary or
non-recurring gains and losses; (iii) depreciation and amortization expense; and
(iv) interest expense; plus (b) such Person's pro rata share of EBITDA of its
Unconsolidated Affiliates.
"Effective Date": The first date upon which all of the conditions
precedent set forth in Section 3.01 shall have been satisfied.
"Eligible Asset": A real estate asset that is accepted by the Agent
for financing and is subject to a Loan hereunder.
"Eligible Asset Disposition": A (i) bona fide sale, transfer or
other disposition of an Eligible Asset by any SPE Entity to a Person who is not
an Affiliate, or (ii) refinancing or encumbering of any Eligible Assets.
"Eligible Asset File": All documents, records, files, data,
information and correspondence in respect of the subject Eligible Asset as
maintained by the Borrowers or their Subsidiaries.
"Environmental Indemnity Agreement": The Environmental Indemnity
Agreement, executed on the date hereof by the Borrowers in favor of the Agent.
"Environmental Laws": Any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or requirements of law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.
"Equity Interest": With respect to any Person, any share of capital
stock of (or other ownership or profit interests in) such Person, any warrant,
option or other right for the purchase or other acquisition from such Person of
any share of capital stock of (or other ownership or profit interests in) such
Person, any security convertible into or exchangeable for any share of capital
stock of (or other ownership or profit interests in) such Person or warrant,
right or option for the purchase or other acquisition from such Person of such
shares (or such other interests) and any other ownership or profit interest in
such Person (including, without limitation, partnership, member or trust
interests therein), whether voting or nonvoting, and whether or not such share,
warrant, option, right or other interest is authorized or otherwise existing on
any date of determination.
"Equity Issuance": Any issuance by the Borrowers or any Subsidiary
to any Person which is not a Borrower of (a) Equity Interests, (b) Equity
Interests pursuant to the exercise of options or warrants; and (c) Equity
Interests pursuant to the conversion of any debt securities to equity; but
excluding any issuance pursuant to the Parent's 2004 Stock Incentive Plan or a
dividend reinvestment plan that the Parent may adopt from time to time.
"ERISA": The Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate": Any corporation or trade or business that is a
member of any group of organizations (i) described in Section 414(b) or (c) of
the Code of which any Borrower is a member and (ii) solely for purposes of
potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of
the Code and the lien created under Section 302(f) of ERISA and Section 412(n)
of the Code, described in Section 414(m) or (o) of the Code of which Seller is a
member.
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"Escrowed Funds": Any portion of the Purchase Price of any Purchased
Assets that is the subject of a binding escrow arrangement with respect to
disbursement of such Purchase Price to the counterparty to such escrow
arrangement, including, without limitation, in connection with construction and
building projects associated with any Purchased Asset.
"Eurodollar Reserve Percentage": For any day, the percentage
(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the maximum reserve requirement
(including without limitation any basic, supplemental or emergency reserves) in
respect of Eurocurrency liabilities, as defined in Regulation D of such Board as
in effect from time to time, or any similar category of liabilities for a member
bank of the Federal Reserve System in New York City.
"Event of Default": The meaning specified in Section 7.01.
"Exit Fee": The meaning provided in the Fee Letter.
"Extension of Credit": As to any Lender, the making of a Loan by
such Lender.
"Fair Market Value": With respect to (a) a security listed on a
national securities exchange or recognized automated quotation system, the price
of such security as reported on such exchange by any widely recognized reporting
method customarily relied upon by financial institutions; (b) with respect to
any other property, including realty, other than Eligible Assets, the price
which could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of which is under pressure
or compulsion to complete the transaction and (c) Eligible Assets, the price
which could be negotiated in an arm's-length free market transaction, for cash
for such Eligible Asset, between a willing seller and a willing buyer, neither
of which is under pressure or compulsion to complete the transaction, in each
case, as determined by Agent in its sole discretion.
"Federal Funds Effective Rate": The meaning set forth in the
definition of "Alternate Base Rate".
"Federal Funds Rate": For any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/1000 of 1%) equal to the weighted
average of the rates on overnight Federal Funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on 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 as so
published on the next succeeding Business Day, and (b) if no such rate is so
published on such Business Day, the Federal Funds Rate for such day shall be the
average of the quotations for such day for such transactions received by the
Agent from three Federal funds brokers of recognized standing and reputation
reasonably selected by the Agent.
"Fee Letter": That certain Fee Letter, dated as of the date hereof,
among the Borrowers and the Agent, as the same may be amended, supplemented or
otherwise modified from time to time.
"Fixed Charge Coverage Ratio": For any Person during any period, the
Adjusted EBITDA for such period divided by the Fixed Charges for the same
period.
"Fixed Charges": For any Person during any period, the sum of (a)
Debt Service, (b) all Preferred Dividends, (c) Capitalized Lease Obligations
paid or accrued during such period, and (d) Capital Expenditures (if any). Fixed
Charges shall include a proportionate share of items (a), (b) and (c) of all
Unconsolidated Affiliates.
"Floating Rate Debt": All Indebtedness of a Person that bears
interest at a variable rate during the scheduled life of such Indebtedness and
for which such Person has not obtained interest rate swap agreements that
effectively cause such variable rates to be equivalent to fixed rates through
the maturity of the Indebtedness.
-6-
"Funds from Operations": For a given period, (a) Net Income of the
Parent and its Subsidiaries for such period (before extraordinary and
non-recurring items), minus (or plus) (b) gains (or losses) from debt
restructuring and sales of property of the Parent and its Subsidiaries during
such period, plus (c) depreciation and amortization of real and personal
property assets of the Parent and its Subsidiaries for such period, plus (d)
without duplication, income from unconsolidated partnerships and joint ventures
of the Parent and its Subsidiaries, determined in each case in accordance with
GAAP.
"GAAP": Generally accepted accounting principles in effect in the
United States of America applied on a consistent basis, subject, however, in the
case of determination of compliance with the financial covenants set out in
Section 5.03 to the provisions of Section 1.03.
"Governmental Authority": Any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guarantee": As to any Person, any obligation of such Person
directly or indirectly guaranteeing any indebtedness of any other Person or in
any manner providing for the payment of any indebtedness of any other Person or
otherwise protecting the holder of such indebtedness against loss (whether by
virtue of partnership arrangements, by agreement to keep-well another Person, to
purchase assets, goods, securities or services, or to agree to take-or-pay
arrangement or otherwise). The amount of any Guarantee of a Person shall be
deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof as
determined by such Person in good faith. The terms "Guarantee" and "Guaranteed"
used as verbs shall have correlative meanings.
"Indebtedness": Without duplication, all items that would constitute
"Indebtedness" as such term is defined under GAAP or pursuant to the reporting
requirements of Sections 13 and 15 of the Securities Exchange Act of 1934, as
amended, but including in any event (i) any mandatory redeemable Equity
Interests, any trust preferred Equity Interests (to the extent owned directly or
beneficially by the Borrowers or any of their Subsidiaries) and any Contingent
Liabilities and (ii) without duplication, any and all of the Borrowers' or any
of their Affiliate' obligations under or in connection with Interest Rate
Protection Agreements.
"Indemnified Party": The meaning set forth in Section 9.05.
"Initial Lender": As defined in the Recitals.
"Interest Expense": Any Person's total interest expense incurred (in
accordance with GAAP), including capitalized or accruing interest (but excluding
interest funded under a construction loan), on a consolidated basis plus the
Person's pro rata share of Interest Expense from Joint Venture Investments and
Unconsolidated Affiliates, without duplication for the most recent period.
"Interest Payment Date": The eleventh (11th) day of each calendar
month, provided that if such day is not a Business Day, the Interest Payment
Date shall occur on the immediately succeeding Business Day.
"Interest Period": With respect to any LIBOR Rate Loan, initially,
the period commencing on the applicable Borrowing Date and ending as of the next
succeeding Interest Payment Date; and thereafter, each period commencing on the
last day of the immediately preceding Interest Period applicable to such LIBOR
Rate Loan and ending on the earlier to occur of (x) the next occurring Interest
Payment Date or (y) the Termination Date.
"Interest Rate Protection Agreement": Any futures contract, options
related contract, short sale of US treasury securities or any interest rate
swap, cap, floor or collar agreement or any other similar arrangement providing
for protection against fluctuations in interest rates or the exchange of nominal
interest obligations, either generally or under specific contingencies and
acceptable to the Agent.
"Lender": The meaning given to such term in the preamble to this
Agreement.
"Leverage Ratio": The ratio of Consolidated Total Assets to
Consolidated Total Liabilities.
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"LIBOR": For any LIBOR Rate Loan for any Interest Period therefor,
the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
appearing on Telerate Page 3750 (or any successor page) as the London interbank
offered rate for deposits in Dollars at approximately 11:00 A.M. (London time)
two Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period. If for any reason such rate is not
available, the term "LIBOR" shall mean, for any LIBOR Rate Loan for any Interest
Period therefor, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at approximately 11:00 A.M.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided, however, if more than
one rate is specified on Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates (rounded upwards, if necessary, to the
nearest 1/100 of 1%). If, for any reason, neither of such rates is available,
then "LIBOR" shall mean the rate per annum at which, as determined by the
Administrative Agent, Dollars in an amount comparable to the Loans then
requested are being offered to leading banks at approximately 11:00 A.M. London
time, two (2) Business Days prior to the commencement of the applicable Interest
Period for settlement in immediately available funds by leading banks in the
London interbank market for a period equal to the Interest Period selected.
"LIBOR Lending Office": Initially, the office of each Lender
designated in writing as such Lender's LIBOR Lending Office and thereafter, such
other office of such Lender as such Lender may from time to time specify to the
Administrative Agent and the Borrowers as the office of such Lender at which the
LIBOR Rate Loans of such Lender are to be made.
"LIBOR Rate": A rate per annum (rounded upwards, if necessary, to
the next higher 1/100th of 1%) determined by the Administrative Agent pursuant
to the following formula:
LIBOR Rate = LIBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
"LIBOR Rate Loan": Loans the rate of interest applicable to which is
based on the LIBOR Rate.
"Lien": Any mortgage, lien, pledge, charge, security interest or
similar encumbrance.
"Loan": The meaning set forth in Section 2.01(a).
"Loan Documents": This Loan Agreement, each Revolving Note, the
Intercreditor Agreement, the Security Documents, the Environmental Indemnity
Agreement, each Negative Pledge Agreement, the Deposit Account Control Agreement
and all other agreements, documents, certificates and instruments delivered to
the Administrative Agent or any Lender by any Borrowers or their Subsidiaries in
connection herewith (other than any agreement, document, certificate or
instrument related to any Interest Rate Protection Agreement).
"Loss Reserves": For any period of four trailing quarters, an amount
equal to the greater of $500,000 or actual losses recorded on the Parent's
statement of operations for such period. The Loss Reserves shall be determined
on an aggregate basis with respect to all assets of the Borrowers and their
Subsidiaries and a proportionate share of all assets of all Unconsolidated
Affiliates.
"Material Adverse Effect": A material adverse effect on (a) the
properties, business, operations, financial condition or prospects of the
Borrowers or the SPE Entities, (b) the ability of the Borrowers or the SPE
Entities to perform their obligations under any of the Loan Documents to which
it is a party, (c) the validity or enforceability of any of the Loan Documents,
(d) the rights and remedies of the Agent under any of the Loan Documents, (e)
the timely payment of any amounts payable under the Loan Documents and (f) the
Fair Market Value of any Eligible Asset.
"Material Contracts": (a) any contract or other agreement, written
or oral, of the Borrowers or any of their Subsidiaries involving in the
aggregate a monetary liability of or to any such Person in excess of $5,000,000
(or, solely with respect to the Borrowers and not in respect of their
Subsidiaries, in an amount in excess of $250,000) and (b) any other contract,
agreement, written or oral, of the Borrowers or any of their Subsidiaries the
failure to comply with which could reasonably be expected to have a Material
Adverse Effect.
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"Moody's": Xxxxx'x Investors Service, Inc.
"Multiemployer Plan": A multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been or are required to be
made by the Borrowers or any ERISA Affiliate and that is covered by Title IV of
ERISA.
"Negative Pledge Agreement": The Negative Pledge Agreement,
substantially in the form attached hereto as Exhibit I.
"Net Income": With respect to any Person for any period, the net
income of such Person for such period as determined in accordance with GAAP.
"Net Proceeds": With respect to any Equity Issuance or Debt Issuance
by a Person, the aggregate amount of all cash and the Fair Market Value of all
other property received by such Person in respect of such Equity Issuance or
Debt Issuance net of investment banking fees, legal fees, accountants' fees,
underwriting discounts and commissions and other customary fees and expenses
actually incurred by such Person in connection with such Equity Issuance.
"Non-Recourse Indebtedness": With respect to a Person, Indebtedness
for borrowed money in respect of which recourse for payment (except for
customary exceptions for fraud, misapplication of funds, environmental
indemnities, and other similar exceptions to non-recourse liability) is
contractually limited to specific assets of such Person encumbered by a Lien
securing such Indebtedness.
"Notice of Borrowing": A request for a Loan borrowing pursuant to
Section 2.01(b)(i).
"Obligations": Without duplication, (i) all of the obligations
(including principal, interest, fees, reimbursements, indemnification
obligations and other amounts) of the Borrowers to the Lenders (including the
Initial Lender) and the Administrative Agent, whenever arising, under this Loan
Agreement, the Notes or any of the other Loan Documents (including, but not
limited to, any interest accruing after the occurrence of a filing of a petition
of bankruptcy under the Bankruptcy Code with respect to any Borrower or their
Subsidiaries, regardless of whether such interest is an allowed claim under the
Bankruptcy Code), (ii) all liabilities and obligations, whenever arising, owing
from any Borrower or their Subsidiaries arising under any Interest Rate
Protection Agreement, and (iii) all liabilities and obligations, whenever
arising, owing from any Borrower or their Subsidiaries to the Lenders (including
the Initial Lender), the Agent or any of their Affiliates.
"Parent": Capital Lease Funding, Inc., a Maryland corporation.
"Participant": The meaning set forth in Section 9.03(b).
"PBGC": The Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Person": Any individual, corporation, company, voluntary
association, partnership, joint venture, limited liability company, trust,
unincorporated association or government (or any agency, instrumentality or
political subdivision thereof).
"Plan": An employee benefit or other plan established or maintained
by any Seller or any ERISA Affiliate and covered by Title N of ERISA, other than
a Multiemployer Plan,
"Pledge and Security Agreement": Each of the Pledge and Security
Agreements, made by Caplease and the Parent in favor of the Initial Lender, as
amended, restated, supplemented or in the form of Exhibit D attached hereto,
otherwise modified and in effect from time to time.
"Preferred Dividends": For any period and without duplication, all
Restricted Payments paid or accrued during such period on Preferred Securities
issued by the Borrowers or their Subsidiaries. Preferred Dividends shall not
include dividends or distributions paid or payable (a) solely in Equity
Interests (other than mandatory redeemable stock) payable to holders of such
class of Equity Interests; (b) to the Borrowers or their Subsidiaries; or (c)
constituting or resulting in the redemption of Preferred Securities, other than
scheduled redemptions not constituting balloon, bullet or similar redemptions in
full.
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"Preferred Securities": With respect to any Person, Equity Interests
in such Person that are entitled to preference or priority over any other Equity
Interest in such Person or the Indebtedness in respect of any payments on such
preferred Equity Interests, including but not limited to, the payment (or
accrual) of dividends or distribution of assets upon liquidation, or both.
"Property": Any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
"Purchase Price": The Fair Market Value of aggregate consideration
given, whether in the form of cash, property or other assets, by any SPE Entity,
to acquire an Eligible Asset and shall include, without limitation, any
contingent consideration payable in respect thereof and any Escrowed Funds.
"Purchased Asset": As of any time, any asset (including, without
limitation, (a) leasehold interests and (b) interests in Preferred Securities
and participating mortgages in which the lender's interest therein is
characterized as equity according to GAAP) owned directly by Borrowers or any
SPE Entity.
"Recovery Event": Receipt by the Borrowers or any of their SPE
Entities of any cash insurance proceeds or condemnation award payable by reason
of theft, loss, physical destruction or damage, taking or similar event with
respect to any Eligible Asset, other than obsolete property or assets no longer
used or useful in the business of the Borrowers or such SPE Entities.
"Regulations T, U and X": Regulations T, U and X of the Board of
Governors of the Federal Reserve System (or any successor), as the same may be
modified and supplemented and in effect from time to time.
"REIT": A "real estate investment trust" within the meaning of the
Code.
"Reportable Event": Any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the thirty day notice period is
waived under Sections .21, -00, .00, .00, .00 xx .00 xx XXXX Reg. 3-4043.
"Repurchase Agreement": The Master Repurchase Agreement, dated as of
September 22, 2004, as amended, among Initial Lender, as buyer, Caplease and
certain special-purposes entity subsidiaries of Caplease, as Sellers, and
Parent, as guarantor.
"Requested Borrowing Date": The date specified in Section
2.01(b)(ii).
"Requirement of Law": As to any Person, the certificate of
incorporation and bylaws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Requisite Lenders": As of any date, Lenders holding Revolving
Commitment Percentages totaling at least 66-2/3%, provided, that any Lender that
is in default hereunder shall not be included in calculating such Revolving
Commitment Percentages.
"Responsible Officer": As to any Person, the chief executive
officer, the chief financial officer, the chief accounting officer, the
treasurer or the chief operating officer of such Person.
"Restricted Payment": (a) any dividend or other distribution, direct
or indirect, on account of any Equity Interest of the Borrowers or any
Subsidiary now or hereafter outstanding, except a dividend payable solely in
Equity Interests of identical class to the holders of that class; (b) any
redemption, conversion, exchange, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any Equity
Interest of the Borrowers or any Subsidiary now or hereafter outstanding; and
(c) any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire any Equity Interests of the
Borrowers or any Subsidiary now or hereafter outstanding.
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"Revolving Commitment": With respect to each Lender, the commitment
of such Lender to make Loans in an aggregate principal amount at any time
outstanding up to such Lender's Revolving Commitment as specified in Schedule
1.01(B), as such amount may be reduced from time to time in accordance with the
provisions hereof.
"Revolving Commitment Percentage": For each Lender, the percentage
identified as its Revolving Commitment Percentage on Schedule 1.01(B), as such
percentage may be modified in connection with any assignment made in accordance
with the provisions of Section 9.03(c).
"Revolving Commitment Amount": The meaning set forth in Section
2.01(a).
"Revolving Note": That Revolving Note, in substantially the form
attached hereto as Exhibit A.
"S&P": Standard & Poor's Ratings Services, a division of The McGraw
Hill Companies, Inc.
"SEC": The Securities and Exchange Commission, or any successor
thereto.
"SEC Off-Balance Sheet Rules": The Disclosure in Management's
Discussion and Analysis About Off-Balance Sheet Arrangements, Securities Act
Release No. 33-8182, 68 Fed. Reg. 5982 (Feb. 5, 2003) (codified at 17 CFR pts.
228, 229 and 249).
"Secured Indebtedness": With respect to any Person, (a) all
Indebtedness of such Person that is secured in any manner by any lien or
encumbrance on any property plus (b) such Person's pro rata share of the Secured
Indebtedness of any of such Person's Unconsolidated Affiliates.
"Secured Recourse Indebtedness": All Total Indebtedness that is
Secured Indebtedness and is not Nonrecourse Indebtedness.
"Security Documents": The Pledge and Security Agreement, the Deposit
Account Control Agreement, and such other documents executed and delivered in
connection with the granting, attachment and perfection of the Administrative
Agent's security interests and liens arising thereunder, including, without
limitation, UCC financing statements.
"SPE Entity": A Subsidiary of the Parent or Caplease formed solely
for the purposes of owning real estate which is an Eligible Asset hereunder and
which Subsidiary shall have such corporate and capital structure, and have
governing documents having such terms and restrictions, as shall be consistent
with bankruptcy-remote "special-purpose entities" in the form of Exhibit C
attached hereto or otherwise reasonably satisfactory to the Agent.
Notwithstanding the foregoing, SPE Entities shall not be required to have
independent directors, and "non-consolidation" opinions in connection with any
SPE Entity shall only be required if requested by the Agent; and whenever any
real estate asset is no longer an Eligible Asset hereunder, the Subsidiary that
owns such asset shall no longer be considered an SPE Entity hereunder.
"Subsidiary": With respect to any Person, any corporation,
partnership, limited liability company or other entity of which at least a
majority of the securities or other ownership interests having by the terms
thereof ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions of such corporation, partnership,
limited liability company or other entity (irrespective of whether or not at the
time securities or other ownership interests of any other class or classes of
such corporation, partnership or other entity shall have or might have voting
power by reason of the happening of any contingency) is at the time directly or
indirectly owned or controlled by such Person or one or more Subsidiaries of
such Person or by such Person and one or more Subsidiaries of such Person.
"Tax Laws": The meaning given to such term in Section 2.12.
"Taxes": The meaning given to such term in Section 2.12.
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"Terminal Payment Date": As for any Eligible Asset, the date that is
90 days after the initial advance with respect to such Eligible Asset.
"Termination Date": August 25, 2006, subject to earlier termination
upon (i) any breach by the Borrowers hereunder and (ii) the termination of
either the Repurchase Agreement or the WBNA Facility.
"Transfer Effective Date": The meaning set forth in each Commitment
Transfer Supplement.
"2.12 Certificate": The meaning set forth in Section 2.12.
"UCC Financing Statement": A financing statement on Form UCC-1 or
the proper national UCC form, naming Initial Lender as "Secured Party" and
Caplease and/or any applicable SPE Entity as "Debtor" and describing the
Collateral.
"Unconsolidated Affiliates": With respect to any Person, any other
Person in whom such Person holds an Investment, which Investment is accounted
for in the financial statements of such Person on an equity basis of accounting
and whose financial results would not be consolidated under GAAP with the
financial results of such Person on the consolidated financial statements of
such Person.
"Underwriting Package": The following documentation in respect of
the Subsidiary's contemplated acquisition and/or financing of real property
pursuant to this Agreement: (a) Phase I (and, if applicable, Phase II)
environmental reports; (b) engineering reports (if applicable); (c) appraisals
(to the extent conducted by the Borrowers or the SPE Entity and available); (d)
title policy commitments; (e) ALTA surveys; (f) agreement for purchase and sale
of the underlying Eligible Asset if the Purchased Asset is an acquisition
financing; (g) an executive summary, presenting in reasonable detail, the
acquisition of such Eligible Asset; (h) the name and credit rating of the tenant
leasing the Eligible Asset; and (i) copies of any (i) lease and (ii) escrow or
holdback agreements or arrangements to be entered into in connection with, or
arising out of, the acquisition of such Eligible Asset.
"Uniform Commercial Code" or "UCC": The Uniform Commercial Code as
in effect on the date hereof in the State of New York; provided that if by
reason of mandatory provisions of law, the perfection, the effect of perfection
or nonperfection, or the priority of the security interest in any Collateral is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than New York, "Uniform Commercial Code" shall mean the Uniform Commercial Code
as in effect in such other jurisdiction for purposes of the provisions hereof
relating to such perfection, effect of perfection or nonperfection, or priority.
"Unsecured Indebtedness": Total Indebtedness that is not Secured
Indebtedness.
"Unsecured Interest Expense": All Interest Expense of the Borrowers
and their Subsidiaries attributable to Unsecured Indebtedness of the Borrowers
and their Subsidiaries for the most recent period.
"USA PATRIOT Act": The USA PATRIOT Act, Title III of Pub. L. 107-56,
signed into law October 26, 2001.
"Voting Interests": With respect to any Person, Equity Interests
issued by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
"Wachovia Indebtedness": All Indebtedness of Borrowers provided by
the Initial Lender or any of its Affiliates, and shall include, without
limitation, Indebtedness arising under the WBNA Facility, the Repurchase
Agreement and any Wachovia Interest Rate Protection Agreements.
"Wachovia Interest Rate Protection Agreements": Any and all of the
Borrowers' or any of their Affiliate' obligations arising under, or in
connection with, any Interest Rate Protection Agreements to which the Initial
Lender or any of its Affiliates is a counterparty thereto.
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"WBNA Facility": The Revolving Loan Agreement in aggregate principal
amount of $75,000,000, dated as even date hereof, among the Borrowers and
Wachovia Bank, National Association, in its respective capacities as initial
Lender an as administrative agent for lenders party thereto from time to time
and all accompanying documentation associated therewith.
Section 1.02 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined in this
Agreement shall have the defined meanings when used in the Notes or other Loan
Documents or any certificate or other document made or delivered pursuant
hereto.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(c) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
subsection, Schedule and Exhibit references are to this Agreement unless
otherwise specified.
(d) The words "include," "includes" and "including" shall be deemed
to be followed by "without limitation" whether or not they are in fact followed
by such words or words of like import.
(e) The words "writing," "written" and comparable terms shall refer
to printing, typing, computer disk, e-mail and other means of reproducing words
in a visible form.
(f) References to any agreement or contract are to such agreement or
contract as amended, restated, supplemented or otherwise modified from time to
time in accordance with the terms hereof and thereof. References to any Person
include the successors and permitted assigns of such Person.
Section 1.03 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 required to be delivered hereunder shall be prepared in
accordance with GAAP applied on a basis consistent with the most recent audited
Consolidated financial statements of Parent delivered to the Lenders.
The Borrowers shall deliver to the Administrative Agent and each
Lender at the same time as the delivery of any periodic financial statements, to
the extent not disclosed in such periodic financial statements, (i) a
description in reasonable detail of any material change in the application of
accounting principles employed in the preparation of such financial statements
from those applied in the most recently preceding periodic financial statements
and (ii) a reasonable estimate of the effect on the financial statements on
account of such changes in application.
Section 1.04 Computation of Time Periods.
All time references in this Loan Agreement and the other Loan
Documents shall be to Charlotte, North Carolina time unless otherwise indicated.
For purposes of computation of periods of time hereunder, the word "from" means
"from and including" and the words "to" and "until" each mean "to but
excluding."
ARTICLE II
THE LOANS; AMOUNT AND TERMS
Section 2.01 Loans.
(a) Revolving Commitment. During the Commitment Period, subject to
the terms and conditions hereof, the Initial Lender agrees initially and, upon
an assignment of any portion of the Revolving Commitment to one or more Lenders,
all Lenders, including, without limitation, the Initial Lender, severally, agree
to make revolving credit loans (each a "Loan" and collectively the "Loans") to
the Borrowers from time to time for the purposes hereinafter set forth;
provided, however, that (i) in the event of an assignment of any portion of the
Revolving Commitment Amount to one or more Lenders, with regard to each Lender
individually, the sum of such Lender's share of outstanding Loans shall not
exceed such Lender's Revolving Commitment Percentage of the aggregate Revolving
Commitment Amount, and (ii) with regard to the Lenders collectively, the sum of
the aggregate amount of outstanding Loans shall not exceed the aggregate
Revolving Commitment Amount then in effect. For purposes hereof, the aggregate
amount available hereunder shall be TWENTY-FIVE MILLION DOLLARS ($25,000,000)
(the "Revolving Commitment Amount"). Loans shall consist of LIBOR Rate Loans and
may be repaid and reborrowed in accordance with the provisions hereof. LIBOR
Rate Loans shall be made by each Lender at its LIBOR Lending Office.
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(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrowers shall request a Loan
borrowing by written notice (or telephonic notice promptly confirmed in
writing which confirmation may be by fax) to the Agent in the form of the
Notice of Borrowing attached as Exhibit J not later than 11:00 a.m. on or
before seven (7) Business Days prior to the date of the requested
borrowing (unless a shorter notice period is approved by the Agent). Each
such request for borrowing shall be irrevocable (except in the event of a
default of the seller of the subject asset resulting in a failure to
close) and shall specify (A) that a Loan is requested, (B) the date of the
requested borrowing (which shall be a Business Day) and (C) the aggregate
principal amount to be borrowed. The Administrative Agent shall give
notice to each Lender promptly upon receipt of each Notice of Borrowing,
the contents thereof and each such Lender's share thereof.
(ii) Delivery of Underwriting Package. No later than concurrently
with the delivery to the Agent of the Notice of Borrowing (unless
otherwise approved by the Agent), the Borrowers shall deliver to the Agent
an Underwriting Package for each proposed Eligible Asset. The Agent shall
notify the Borrowers on or prior to two (2) Business Days preceding the
date specified in the Notice of Borrowing for the making of Loans (the
"Requested Borrowing Date") whether the Agent has (i) rejected the
proposed Loan based on the Agent's review of the Underwriting Package,
(ii) has agreed to the proposed Loan or (iii) has agreed to make the
requested Loan subject to remediation of any deficiencies in the
Underwriting Package. The Borrowers shall use commercially reasonable
efforts to remedy any deficiencies in the Underwriting Package on or prior
to the Requested Borrowing Date. If such deficiencies remain unremedied as
of the Requested Borrowing Date and, in the Agent's reasonable judgment,
such deficiencies are material, the Agent shall not be obligated to make
the Loan to the Borrowers requested in the Notice of Borrowing and the
Agent may, in its sole discretion, refuse to honor the submitted Notice of
Borrowing, which shall thereafter become void automatically without
further action by any party.
(iii) Minimum Amounts. Each Loan shall be in a minimum aggregate
amount of $2,000,000 (or the remaining amount of the Revolving Commitment
Amount, if less).
(iv) Advances. Each Lender will make its Revolving Commitment
Percentage of each approved Loan borrowing available to the Administrative
Agent for the account of the Borrowers at the office of the Administrative
Agent identified in the signature page to this Agreement, or at such other
office as the Administrative Agent may designate in writing, upon
reasonable advance notice by 1:00 P.M. on the date specified in the
applicable Notice of Borrowing, in Dollars and in funds immediately
available to the Administrative Agent. Such borrowing will then be made
available to the Borrowers by the Administrative Agent by crediting the
account of the Borrower on the books of such office with the aggregate of
the amounts made available to the Administrative Agent by the Lenders and
in like funds as received by the Administrative Agent.
(c) Use and Repayment of Loan Proceeds. The proceeds of all Loans
shall be used solely to finance an Eligible Asset; provided, however, that no
Loan proceeds in excess of the product of the (x) Fair Market Value of such
Eligible Asset times (y) the Advance Rate may be used to finance such Eligible
Asset. The Borrowers shall repay on the Terminal Payment Date, the amount of
Loan proceeds used to finance such Eligible Asset. Amounts repaid hereunder may
be reborrowed in accordance with the terms hereof.
(d) Additional Loan Proceeds. Without the prior written consent of
the Agent, no additional Loan proceeds may be used to finance any portion of the
Purchase Price of any Eligible Asset if any Loan proceeds were used at any time
during the term of this Agreement to initially finance any portion of the
Purchase Price of such Eligible Asset.
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(e) Interest. Subject to the provisions of Section 2.04, Loans shall
be comprised of LIBOR Rate Loans and each such LIBOR Rate Loan shall bear
interest at a per annum rate equal to the sum of the LIBOR Rate plus the
Applicable Premium. Interest on Loans shall be payable in arrears on each
Interest Payment Date.
(f) Revolving Notes. The Borrowers' obligation to pay each Lender's
Loans shall be evidenced by a Revolving Note made payable to such Lender in
substantially the form of Exhibit A, if requested by such Lender.
Section 2.02 Payments to Collection Account. Upon the delivery of one (1)
Business Day's written notice from the Administrative Agent, the Borrowers shall
pay all amounts received from the Eligible Assets on or after receipt of the
notice into the collection account established pursuant to the terms of the
Deposit Account Control Agreement (the "Collection Account"). Any failure to
make such a mandatory payment into the Collection Account within one (1)
Business Day as set forth above, shall be an Event of Default pursuant to
Section 6.01(a). Notwithstanding the foregoing mandatory payment obligation, all
other payment obligations arising under the Loan Documents may, at the option of
the Borrowers, also be deposited into the Collection Account.
Section 2.03 Prepayments.
(a) Optional Prepayments. The Borrowers shall have the right to make
optional prepayments hereunder from time to time upon the delivery of five (5)
Business Days' irrevocable notice; provided, however, that each optional
prepayment of Loans shall be in a minimum principal amount of $2,000,000.
Amounts prepaid under this Section 2.03(a) shall be applied first, to the extent
amounts are outstanding under this Agreement, to the repayment of such amounts
(pro rata with respect to advances under this Agreement) and then, to the
outstanding Loans under the WBNA Facility (pro rata with respect to all such
advances); provided, that each Lender shall receive its pro rata share of any
such prepayment based on its Revolving Commitment Percentage. All prepayments
under this Section 2.03(a) shall be subject to Section 2.11. All prepayments
under this facility shall, to the extent required under the Fee Letter, be
accompanied by the Exit Fee. Interest on the principal amount prepaid shall be
due and payable on any date that a prepayment is made hereunder through the date
of prepayment. Amounts prepaid on the Loans may be reborrowed in accordance with
the terms hereof.
(b) Mandatory Prepayments.
(i) Revolving Commitment Amount. If at any time after the Closing
Date, the sum of the aggregate principal amount of outstanding Loans shall
exceed the aggregate Revolving Commitment Amount then in effect, the
Borrowers immediately shall prepay the Loans in an amount sufficient to
eliminate such excess (such prepayment to be applied as set forth in
clause (vii) below).
(ii) Eligible Asset Dispositions. Promptly following any Eligible
Asset Disposition, the Borrowers shall prepay the Loans in an aggregate
amount equal to the lesser of (x) 100% of the net proceeds derived from
such Eligible Asset Disposition or (y) the portion of the Loans
attributable to such Eligible Assets (such prepayment to be applied as set
forth in clause (vii) below).
(iii) Issuances of Debt and Equity. Immediately upon receipt by the
Borrowers or any of their Subsidiaries of proceeds from any Equity
Issuance or Debt Issuance, the Borrowers shall prepay the Loans in an
aggregate amount equal to 100% of the Net Proceeds of such Equity Issuance
or Debt Issuance, as the case may be (such prepayment to be applied as set
forth in clause (vii) below).
(iv) Recovery Event. Promptly upon receipt, the Borrowers shall
prepay the Loans in an aggregate amount equal to 100% of the net proceeds
received in connection with a Recovery Event (such prepayment to be
applied as set forth in clause (vii) below).
(v) Adjustment Event. Immediately upon the occurrence and
continuation of an Adjustment Event, the Borrowers shall repay to Agent an
amount sufficient to reduce borrowings outstanding hereunder to an amount
equal the product of the (a) adjusted Fair Market Value for the affected
Eligible Asset resulting therefrom and (b) the Advance Rate (such
prepayment to be applied to the affected Loan).
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(vi) Application of Mandatory Prepayments. All amounts required to
be paid pursuant to Section 2.03(b)(ii) shall be applied pro rata to the
then-outstanding Loans. All amounts required to be paid pursuant to
Section 2.03(b)(iii), (v) and (vi) shall be applied to repay the Loans
attributable to Eligible Assets which were disposed, refinanced or which
experienced a Recovery Event or Adjustment Event, as the case may be. All
amounts (A) required to be paid pursuant to Section 2.03(b)(iv) and (B) in
excess of amounts used to repay Loans as provided in the immediately
preceding sentence shall be applied:
FIRST, to the payment of any Obligations of the Borrowers then
outstanding hereunder in the priorities set forth in this Agreement until
fully paid and discharged;
SECOND, to the payment of any Obligations of the Borrowers then
outstanding under the WBNA Facility and the other Loan Documents in the
manner identified in Section 2.06(b) until fully paid and discharged;
THIRD, to the payment of any obligations of the Borrowers then
outstanding under the Repurchase Agreement in the priorities set forth in
the Repurchase Agreement until fully paid and discharged; and
FOURTH, to the payment of the surplus, if any, to whoever may be
lawfully entitled to receive such surplus.
All prepayments under this Section 2.03(b) shall be subject to Section
2.11 and be accompanied by: (A) interest on the principal amount prepaid
through the date of prepayment; and (B) to the extent required by the Fee
Letter, the Exit Fee.
Section 2.04 Default Rate and Payment Dates.
(a) (i) If all or a portion of the principal amount of any Loan
shall not be paid when due, such overdue amount shall bear interest at a rate
per annum which is equal to the rate that would otherwise be applicable thereto
plus 5.0% (the "Default Rate"), or (ii) if any interest payable on the principal
amount of any Loan or any fee or other amount, including the principal amount of
any Loan, payable hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum which is equal to the Default Rate, in each case from the
date of such non-payment until such amount is paid in full (after as well as
before judgment). Upon the occurrence, and during the continuance, of any other
Event of Default hereunder, the principal of and, to the fullest extent
permitted by law, interest on the Loans and any other amounts owing hereunder or
under the other Loan Documents shall bear interest, payable on demand, at a per
annum rate which is (A) in the case of principal, the rate that would otherwise
be applicable thereto plus 5.0% or (B) in the case of interest, fees or other
amounts, the Default Rate (after as well as before judgment). The Requisite
Lenders shall have the right to revoke the imposition of any default interest
imposed under this Section 2.04(a).
(b) Interest on each Loan shall be payable in arrears on each
Interest Payment Date; provided that interest accruing pursuant to paragraph (a)
of this Section 2.04 shall be payable from time to time on demand.
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Section 2.05 Computation of Interest and Fees.
(a) All fees, interest and all other amounts payable hereunder shall
be calculated on the basis of a 360 day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the Borrowers and the
Lenders of each determination of a LIBOR Rate on the Business Day of the
determination thereof.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Loan Agreement shall be conclusive and
binding on the Borrowers and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrowers, deliver to the
Borrowers a statement showing the computations used by the Administrative Agent
in determining any interest rate.
(c) It is the intent of the Lenders and the Borrowers to conform to
and contract in strict compliance with applicable usury law from time to time in
effect. All agreements between the Lenders and the Borrowers are hereby limited
by the provisions of this paragraph which shall override and control all such
agreements, whether now existing or hereafter arising and whether written or
oral. In no way, nor in any event or contingency (including but not limited to
prepayment or acceleration of the maturity of any Obligation), shall the
interest taken, reserved, contracted for, charged, or received under this Loan
Agreement, under the Revolving Notes or otherwise, exceed the maximum
nonusurious amount permissible under applicable law. If, from any possible
construction of any of the Loan Documents or any other document, interest would
otherwise be payable in excess of the maximum nonusurious amount, any such
construction shall be subject to the provisions of this paragraph and such
interest shall be automatically reduced to the maximum nonusurious amount
permitted under applicable law, without the necessity of execution of any
amendment or new document. If any Lender shall ever receive anything of value
which is characterized as interest on the Loans under applicable law and which
would, apart from this provision, be in excess of the maximum nonusurious
amount, an amount equal to the amount which would have been excessive interest
shall, without penalty, be applied to the reduction of the principal amount
owing on the Loans and not to the payment of interest, or refunded to the
Borrowers or the other payor thereof if and to the extent such amount which
would have been excessive exceeds such unpaid principal amount of the Loans. The
right to demand payment of the Loans or any other Indebtedness evidenced by any
of the Loan Documents does not include the right to receive any interest which
has not otherwise accrued on the date of such demand, and the Lenders do not
intend to charge or receive any unearned interest in the event of such demand.
All interest paid or agreed to be paid to the Lenders with respect to the Loans
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated, and spread throughout the full stated term (including any renewal or
extension) of the Loans so that the amount of interest on account of such
indebtedness does not exceed the maximum nonusurious amount permitted by
applicable law.
Section 2.06 Pro Rata Treatment and Payments.
(a) Allocation of Payments Before Event of Default. Each borrowing
of Loans shall be made pro rata by the Lenders according to the respective
Revolving Commitment Percentages of the Lenders. Each payment under this Loan
Agreement or any Revolving Note shall be applied, first, to any fees then due
and owing by the Borrowers under this Agreement, second, to interest then due
and owing hereunder and under the Revolving Notes and, third, to principal then
due and owing hereunder and under the Revolving Notes. Each payment on account
of any fees shall be made pro rata in accordance with the respective amounts due
and owing. Each payment (other than prepayments) by the Borrowers on account of
principal of and interest on the Loans shall be applied to such Loans in
accordance with the terms of Section 2.06(b) hereof. Except to the extent
provided in Section 2.03, each mandatory prepayment on account of principal of
the Loans shall be applied in accordance with Section 2.06(b). All payments
(including prepayments) to be made by the Borrowers on account of principal,
interest and fees shall be made without defense, set-off or counterclaim (except
as provided in Section 2.12(b)) and shall be made to the Administrative Agent
for the account of the Lenders at the Administrative Agent's office specified on
signature page hereto in Dollars and in immediately available funds not later
than 1:00 P.M. on the date when due. The Administrative Agent shall distribute
such payments to the Lenders entitled thereto promptly upon receipt in like
funds as received. If any payment hereunder becomes due and payable on a day
other than a Business Day, such payment shall be extended to the next succeeding
Business Day, and, with respect to payments of principal, interest thereon shall
be payable at the then applicable rate during such extension.
(b) Allocation of Payments After Exercise of Remedies.
Notwithstanding any other provisions of this Loan Agreement to the contrary,
after the Revolving Commitments shall have been terminated, and the Loans and
all other amounts under the Loan Documents shall have become due and payable in
accordance with the terms of Section 6.02 hereof, except as otherwise required
pursuant to the terms of any intercreditor agreement, all amounts collected or
received by the Administrative Agent or any Lender on account of the Borrowers'
Obligations under the Loan Documents or any other amounts outstanding under any
of the Loan Documents or in respect of the Collateral shall be paid over or
delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses (including without limitation reasonable attorneys' fees) of the
Administrative Agent in connection with enforcing the rights of the Lenders
under the Loan Documents and any protective advances made by the Administrative
Agent with respect to the Collateral under or pursuant to the terms of the
Security Documents;
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SECOND, to payment of any fees (including without limitation, the
Exit Fee) owed to the Administrative Agent;
THIRD, to the payment of all reasonable out-of-pocket costs and
expenses (including without limitation, reasonable attorneys' and consultants'
fees) of each of the Lenders in connection with enforcing its rights under the
Loan Documents or otherwise with respect to the Obligations of the Borrowers
owing to such Lender;
FOURTH, to the payment of all of the Obligations of the Borrowers
consisting of accrued interest;
FIFTH, to the payment of the outstanding principal amount of the
Obligations of the Borrowers;
SIXTH, to all other Obligations of the Borrowers and other
obligations which shall have become due and payable under the Loan Documents or
otherwise and not repaid pursuant to clauses "FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may be
lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied
in the numerical order provided until exhausted prior to application to the next
succeeding category and (ii) each of the Lenders shall receive an amount equal
to its pro rata share (based on its Revolving Commitment Percentage) of amounts
available to be applied pursuant to clauses "THIRD," "FOURTH," "FIFTH" and
"SIXTH" above.
Section 2.07 Non-Receipt of Funds by the Administrative Agent.
(a) Unless the Administrative Agent shall have been notified in
writing by a Lender prior to the date a Loan is to be made by such Lender (which
notice shall be effective upon receipt) that such Lender does not intend to make
the proceeds of such Loan available to the Administrative Agent, the
Administrative Agent may assume that such Lender has made such proceeds
available to the Administrative Agent on such date, and the Administrative Agent
may in reliance upon such assumption (but shall not be required to) make
available to the Borrowers a corresponding amount. If such corresponding amount
is not in fact made available to the Administrative Agent, the Administrative
Agent shall be able to recover such corresponding amount from such Lender. If
such Lender does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent will promptly
notify the Borrowers, and the Borrowers shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also be
entitled to recover from the Lender or the Borrowers, as the case may be,
interest on such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Administrative Agent to the
Borrowers to the date such corresponding amount is recovered by the
Administrative Agent at a per annum rate equal to (i) from the Borrowers at the
applicable rate for the applicable borrowing pursuant to the Notice of Borrowing
and (ii) from a Lender at the Federal Funds Effective Rate.
(b) Unless the Administrative Agent shall have been notified in
writing by the Borrowers, prior to the date on which any payment is due from it
hereunder (which notice shall be effective upon receipt) that the Borrowers do
not intend to make such payment, the Administrative Agent may assume that such
Borrowers have made such payment when due, and the Administrative Agent may in
reliance upon such assumption (but shall not be required to) make available to
each Lender on such payment date an amount equal to the portion of such assumed
payment to which such Lender is entitled hereunder, and if the Borrowers have
not in fact made such payment to the Administrative Agent, such Lender shall, on
demand, repay to the Administrative Agent the amount made available to such
Lender. If such amount is repaid to the Administrative Agent on a date after the
date such amount was made available to such Lender, such Lender shall pay to the
Administrative Agent on demand interest on such amount in respect of each day
from the date such amount was made available by the Administrative Agent to such
Lender to the date such amount is recovered by the Administrative Agent at a per
annum rate equal to the Federal Funds Effective Rate.
(c) A certificate of the Administrative Agent submitted to the
Borrowers or any Lender with respect to any amount owing under this Section 2.07
shall be conclusive in the absence of manifest error.
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Section 2.08 Inability to Determine Interest Rate.
Notwithstanding any other provision of this Loan Agreement, if (i)
the Administrative Agent shall reasonably determine on an institutional basis
for all LIBOR based loans (including the Loans) made by such Requisite Lenders
(which determination shall be conclusive and binding absent manifest error)
that, by reason of circumstances affecting the relevant market, reasonable and
adequate means do not exist for ascertaining LIBOR for such Interest Period, or
(ii) the Requisite Lenders shall reasonably determine (which determination shall
be conclusive and binding absent manifest error) that the LIBOR Rate does not
adequately and fairly reflect the cost to such Lenders of funding all such LIBOR
based loans (including the Loans), the Administrative Agent shall forthwith give
telephone notice of such determination, confirmed in writing, to the Borrowers
and the Lenders at least two Business Days prior to the first day of such
Interest Period. Unless the Borrowers shall have notified the Administrative
Agent upon receipt of such telephone notice that they wish to rescind or modify
their request regarding such Loans, any Loans that were requested to be made as
LIBOR Rate Loans shall be made as Alternate Base Rate Loans. Until any such
notice has been withdrawn by the Administrative Agent, no further Loans shall be
made as or continued as LIBOR Rate Loans for the Interest Periods so affected.
Section 2.09 Illegality.
Notwithstanding any other provision of this Loan Agreement, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof by the relevant Governmental Authority to any Lender shall
make it unlawful for such Lender or its LIBOR Lending Office to make or maintain
LIBOR Rate Loans as contemplated by this Loan Agreement or to obtain in the
interbank eurodollar market through its LIBOR Lending Office the funds with
which to make such Loans, (a) such Lender shall promptly notify the
Administrative Agent and the Borrowers thereof, (b) the commitment of such
Lender hereunder to make LIBOR Rate Loans or continue LIBOR Rate Loans as such
shall forthwith be suspended until the Administrative Agent shall give notice
that the condition or situation which gave rise to the suspension shall no
longer exist, and (c) such Lender's Loans then outstanding as LIBOR Rate Loans,
if any, shall be converted on the last day of the Interest Period for such Loans
or within such earlier period as required by law as Alternate Base Rate Loans.
The Borrowers hereby agree promptly to pay any Lender, upon its demand, any
additional amounts necessary to compensate such Lender for actual and direct
costs (but not including anticipated profits) reasonably incurred by such Lender
in order to make or maintain its LIBOR Rate Loans hereunder. A certificate as to
any additional amounts payable pursuant to this Section (which certificate must
be delivered to the Administrative Agent within 10 Business Days of the change
in law) submitted by such Lender, through the Administrative Agent, to the
Borrowers shall be conclusive in the absence of manifest error. Each Lender
agrees to use reasonable efforts (including reasonable efforts to change its
LIBOR Lending Office) to avoid or to minimize any amounts which may otherwise be
payable pursuant to this Section; provided, however, that such efforts shall not
cause the imposition on such Lender of any additional costs or legal or
regulatory burdens deemed by such Lender in its sole discretion to be material.
Section 2.10 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law or in
the interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:
(i) shall subject such Lender to any tax of any kind whatsoever with
respect to any LIBOR Rate Loan made by it, or change the basis of taxation
of payments to such Lender in respect thereof (except for changes in the
rate of tax on the overall net income of such Lender);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender which is not otherwise included in the determination
of the LIBOR Rate hereunder; or
(iii) shall impose on such Lender any other condition;
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and the result of any of the foregoing is to increase the cost to
such Lender of making or maintaining LIBOR Rate Loans or to reduce
any amount receivable hereunder or under any Revolving Note, then,
in any such case, the Borrowers shall promptly pay such Lender, upon
its demand, any additional amounts necessary to compensate such
Lender for such additional cost or reduced amount receivable which
such Lender reasonably deems to be material as determined by such
Lender with respect to its LIBOR Rate Loans. A certificate as to any
additional amounts payable pursuant to this Section (which
certificate must be delivered to the Administrative Agent within 10
Business Days of the change in law) submitted by such Lender,
through the Administrative Agent, to the Borrowers shall be
conclusive in the absence of manifest error. Each Lender agrees to
use reasonable efforts (including reasonable efforts to change its
LIBOR Lending Office) to avoid or to minimize any amounts which
might otherwise be payable pursuant to this paragraph of this
Section; provided, however, that such efforts shall not cause the
imposition on such Lender of any additional costs or legal or
regulatory burdens deemed by such Lender to be material.
(b) If any Lender shall have reasonably determined that the adoption
of or any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any person
controlling such Lender with any request or directive regarding capital adequacy
(whether or not having the force of law) from any central bank or Governmental
Authority made subsequent to the date hereof does or shall have the effect of
reducing the rate of return on such Lender's or such person's capital as a
consequence of its obligations hereunder to a level below that which such Lender
or such corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such person's policies
with respect to capital adequacy) by an amount reasonably deemed by such Lender
to be material, then from time to time, within fifteen (15) days after demand by
such Lender, the Borrowers shall pay to such Lender such additional amount as
shall be certified by such Lender as being required to compensate it for such
reduction. Such a certificate as to any additional amounts payable under this
Section submitted by a Lender (which certificate shall include a description of
the basis for the computation), through the Administrative Agent, to the
Borrowers shall be conclusive absent manifest error.
Section 2.11 Indemnity.
The Borrowers hereby agree to indemnify each Lender and to hold such
Lender harmless from any funding loss or expense which such Lender may sustain
or incur as a consequence of (a) the failure by the Borrowers to pay the
principal amount of or interest on any Loan by such Lender in accordance with
the terms hereof, (b) the failure of the Borrowers to accept a borrowing after
the Borrowers have given a notice in accordance with the terms hereof (unless
revoked in accordance with Section 2.01(b)(i)) and/or (c) the failure of the
Borrowers to make any prepayment after the Borrowers have given a notice in
accordance with the terms hereof, in each case including, but not limited to,
any such loss or expense arising from interest or fees payable by such Lender to
lenders of funds obtained by it in order to maintain its Loans hereunder. A
certificate as to any additional amounts payable pursuant to this Section 2.11
submitted by any Lender, through the Administrative Agent, to the Borrowers
(which certificate must be delivered to the Administrative Agent within thirty
(30) days following such default, prepayment or conversion) shall be conclusive
in the absence of manifest error. The agreements in this Section 2.11 shall
survive termination of this Loan Agreement and payment of the Revolving Notes
and all other amounts payable hereunder.
Section 2.12 Taxes.
(a) All payments made by the Borrowers hereunder or under any
Revolving Note will be, except as provided in Section 2.12(b), made free and
clear of, and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever nature
now or hereafter imposed pursuant to any law, rule, regulation or other
promulgation by any Governmental Authority or by any political subdivision or
taxing authority thereof (collectively, "Tax Laws") or therein with respect to
such payments (but excluding any tax imposed on or measured by the net income or
profits of a Lender pursuant to the laws of the jurisdiction in which it is
organized or the jurisdiction in which the principal office or applicable
lending office of such Lender is located or any subdivision thereof or therein)
and all interest, penalties or similar liabilities with respect thereto (all
such non-excluded taxes, levies, imposts, duties, fees, assessments or other
charges being referred to collectively as "Taxes"). If any Taxes are so levied
or imposed, the Borrowers agree to pay the full amount of such Taxes, and such
additional amounts as may be necessary so that every payment of all amounts due
under this Loan Agreement or under any Revolving Note, after withholding or
deduction for or on account of any Taxes, will not be less than the amount
provided for herein or in such Revolving Note. The Borrowers will furnish to the
Administrative Agent as soon as practicable after the date the payment of any
Taxes is due pursuant to applicable law certified copies (to the extent
reasonably available and required by law) of tax receipts evidencing such
payment by the Borrowers. The Borrowers agree to indemnify and hold harmless
each Lender, and reimburse such Lender upon its written request, for the amount
of any Taxes so levied or imposed and paid by such Lender.
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(b) Each Lender that is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) agrees to deliver to the Borrowers
and the Administrative Agent on or prior to the Closing Date, or in the case of
a Lender that is an assignee or transferee of an interest under this Loan
Agreement pursuant to Section 9.03 (unless the respective Lender was already a
Lender hereunder immediately prior to such assignment or transfer), on the date
of such assignment or transfer to such Lender, (i) if the Lender is a "bank"
within the meaning of Section 881(c)(3)(A) of the Code, two accurate and
complete original signed copies of Internal Revenue Service Form X-0XXX, X-0XXX
or W-8IMY (or successor forms) certifying such Lender's entitlement to a
complete exemption from United States withholding tax with respect to payments
to be made under this Loan Agreement and under any Revolving Note, or (ii) if
the Lender is not a "bank" within the meaning of Section 881(c)(3)(A) of the
Code, Internal Revenue Service Form X-0XXX, X-0XXX or W-8IMY as set forth in
clause (i) above, or (x) a certificate in substantially the form of Exhibit L
(any such certificate, a "2.12 Certificate") and (y) two accurate and complete
original signed copies of Internal Revenue Service Form W-8BEN (or successor
form) certifying such Lender's entitlement to an exemption from United States
withholding tax with respect to payments of interest to be made under this Loan
Agreement and under any Revolving Note. In addition, each Lender agrees that it
will deliver upon the Borrowers' request updated versions of the foregoing, as
applicable, whenever the previous certification has become obsolete or
inaccurate in any material respect, together with such other forms as may be
required in order to confirm or establish the entitlement of such Lender to a
continued exemption from or reduction in United States withholding tax with
respect to payments under this Loan Agreement and any Revolving Note.
Notwithstanding anything to the contrary contained in Section 2.12(a), but
subject to the immediately succeeding sentence, (x) the Borrowers shall be
entitled, to the extent it is required to do so by law, to deduct or withhold
Taxes imposed by the United States (or any political subdivision or taxing
authority thereof or therein) from interest, fees or other amounts payable
hereunder for the account of any Lender which is not a United States person (as
such term is defined in Section 7701(a)(30) of the Code) for U.S. federal income
tax purposes to the extent that such Lender has not provided to the Borrowers
U.S. Internal Revenue Service Forms that establish a complete exemption from
such deduction or withholding and (y) the Borrowers shall not be obligated
pursuant to Section 2.12(a) hereof to gross-up payments to be made to a Lender
in respect of Taxes imposed by the United States if (I) such Lender has not
provided to the Borrowers the Internal Revenue Service Forms required to be
provided to the Borrowers pursuant to this Section 2.12(b) or (II) in the case
of a payment, other than interest, to a Lender described in clause (ii) above,
to the extent that such Internal Revenue Service Forms do not establish a
complete exemption from withholding of such Taxes. Notwithstanding anything to
the contrary contained in the preceding sentence or elsewhere in this Section
2.12, the Borrowers agree to pay additional amounts and to indemnify each Lender
in the manner set forth in Section 2.12(a) (without regard to the identity of
the jurisdiction requiring the deduction or withholding) in respect of any
amounts deducted or withheld by it as described in the immediately preceding
sentence as a result of any changes after the Closing Date in any applicable
law, treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof, relating to the deducting or withholding of Taxes.
(c) Each Lender agrees to use reasonable efforts (including
reasonable efforts to change its LIBOR Lending Office) to avoid or to minimize
any amounts which might otherwise be payable pursuant to this Section; provided,
however, that such efforts shall not cause the imposition on such Lender of any
additional costs or legal or regulatory burdens deemed by such Lender in its
sole discretion to be material.
(d) If the Borrowers pay any additional amount pursuant to this
Section 2.12 with respect to a Lender, such Lender shall use reasonable efforts
to obtain a refund of tax or credit against its tax liabilities on account of
such payment; provided that such Lender shall have no obligation to use such
reasonable efforts if either (i) it is in an excess foreign tax credit position
or (ii) it believes in good faith, in its sole discretion, that claiming a
refund or credit would cause adverse tax consequences to it. In the event that
such Lender receives such a refund or credit, such Lender shall pay to the
Borrowers an amount that such Lender reasonably determines is equal to the net
tax benefit obtained by such Lender as a result of such payment by the
Borrowers. In the event that no refund or credit is obtained with respect to the
Borrowers' payments to such Lender pursuant to this Section 2.12, then such
Lender shall upon request provide a certification that such Lender has not
received a refund or credit for such payments. Nothing contained in this Section
2.12 shall require a Lender to disclose or detail the basis of its calculation
of the amount of any tax benefit or any other amount or the basis of its
determination referred to in the proviso to the first sentence of this Section
2.12 to the Borrowers or any other party.
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(e) The agreements in this Section 2.12 shall survive the
termination of this Loan Agreement and the payment of the Revolving Notes and
all other amounts payable hereunder.
ARTICLE III
CONDITIONS PRECEDENT
Section 3.01 Conditions.
The obligation of the Initial Lender to make the initial Loans is
subject to the satisfaction of the following conditions precedent:
(a) Execution of Loan Agreement and Loan Documents. The
Administrative Agent shall have received (i) counterparts of this Loan
Agreement, executed by a duly authorized officer of each party hereto, (ii) a
duly executed Revolving Note, (iii) counterparts of the Pledge and Security
Agreement conforming to the requirements of this Loan Agreement and executed by
duly authorized Responsible Officers of Caplease and each SPE Entity in
existence as of the Closing Date, and (iv) counterparts of any other Loan
Document, executed by the duly authorized Responsible Officers of the parties
thereto.
(b) Authority Documents. The Administrative Agent shall have
received the following:
(i) Articles of Incorporation, Etc. Copies of the articles of
incorporation or other charter or formation documents of each Borrower and
each SPE Entity in existence as of the Closing Date certified to be true
and complete as of a recent date by the appropriate Governmental Authority
of the state of its incorporation or formation, as the case may be.
(ii) Resolutions. Copies of resolutions of the board of directors or
other comparable managing body of Parent, on behalf of Parent and each SPE
Entity, approving and adopting the Loan Documents, the transactions
contemplated therein and authorizing execution and delivery thereof,
certified by a Responsible Officer or the managing member of the Parent,
to be true and correct and in force and effect as of such date.
(iii) Bylaws. A copy of the bylaws and/or operating agreement of
each Borrower and each SPE Entity in existence as of the Closing Date
certified by a Responsible Officer or managing member of such Borrower and
each SPE Entity as of the Closing Date to be true and correct and in force
and effect as of such date.
(iv) Good Standing. Copies of certificates of good standing,
existence or its equivalent with respect to each Borrower and each SPE
Entity certified as of a recent date by the appropriate Governmental
Authorities of the state of incorporation or formation, as the case may
be, and each other state in which such Borrower and each SPE Entity is
qualified to do business.
(v) Incumbency. An incumbency certificate of each Borrower and each
SPE Entity certified by a secretary or assistant secretary to be true and
correct as of the Closing Date.
(c) Personal Property Collateral. The Administrative Agent shall
have received, in form and substance satisfactory to the Administrative Agent:
(i) searches of Uniform Commercial Code filings in the jurisdiction
of the chief executive office and state of incorporation of each Borrower
and each SPE Entity in existence as of the Closing Date and each
jurisdiction where any Collateral is located or where a filing would need
to be made in order to perfect the Administrative Agent's security
interest in the Collateral, copies of the financing statements on file in
such jurisdictions and evidence that no Liens exist;
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(ii) UCC financing statements for each appropriate jurisdiction as
is necessary, in the Administrative Agent's sole discretion, to perfect
the Administrative Agent's security interest in the Collateral;
(iii) all stock certificates, if any, evidencing the Collateral to
be pledged to the Administrative Agent pursuant to the Pledge and Security
Agreement, together with duly executed in blank undated stock powers
attached thereto; and
(iv) duly executed consents as are necessary, in the Administrative
Agent's sole discretion, to perfect the Lenders' security interest in the
Collateral.
(d) Legal Opinions of Counsel. The Administrative Agent shall have
received one or more opinions of counsel for the Borrowers dated the Closing
Date and acceptable to the Administrative Agent and the Initial Lender.
(e) Fees. The Administrative Agent and the Initial Lender shall have
received all fees, if any, owing pursuant to the Fee Letter.
(f) Litigation. There shall not exist any pending or threatened
litigation, investigation, bankruptcy or insolvency, injunction, order or claim
affecting or relating to any Borrower or any of their respective Subsidiaries,
this Agreement and the other Loan Documents, that has not been settled,
dismissed, vacated, discharged or terminated prior to the Closing Date which
could reasonably be expected to result in a Material Adverse Effect.
(g) Solvency Certificate. The Administrative Agent shall have
received an officer's certificate prepared by a Responsible Officer of the
Borrowers as to the financial condition, solvency and related matters of the
Borrowers, after giving effect to the initial borrowings under the Loan
Documents, in substantially the form of Exhibit G hereto.
(h) Corporate Structure. The corporate capital and ownership
structure of the Borrowers and their respective Subsidiaries as of June 30, 2005
shall be as described in Schedule 3.01(h).
(i) Consents. The Administrative Agent shall have received evidence
that all governmental, shareholder and material third party consents and
approvals necessary in connection with the financing and other transactions
contemplated hereby have been obtained.
(j) Compliance with Laws. The financing and other transactions
contemplated hereby shall be in compliance with all applicable laws and
regulations (including all applicable securities and banking laws, rules and
regulations).
(k) Bankruptcy. There shall be no bankruptcy or insolvency
proceedings commenced or threatened to be commenced against the Borrowers or any
of their Subsidiaries.
(l) Intentionally Omitted.
(m) Financial Statements. The Administrative Agent and the Initial
Lender shall have received copies of the financial statements referred to in
Section 4.01(f) hereof, each in form and substance satisfactory to it.
(n) No Material Adverse Change. Since June 30, 2005, there has been
no material adverse change in the business, properties, prospects, operations or
condition (financial or otherwise) of the Borrowers and their Subsidiaries taken
as a whole.
(o) Compliance Certificate. The Administrative Agent shall have
received a Compliance Certificate in the form attached hereto as Exhibit H, duly
executed by a Responsible Officer of the Parent, and satisfactory to the
Administrative Agent in its sole discretion.
(p) Officer's Certificate. The Administrative Agent shall have
received a certificate executed by a Responsible Officer of the Parent as of the
Closing Date stating that (i) no action, suit, investigation or proceeding is
pending or, to the knowledge of the Borrowers, threatened in any court or before
any arbitrator or governmental instrumentality that purports to affect the
Borrowers or any other transaction contemplated by the Loan Documents, if such
action, suit, investigation or proceeding could reasonably be expected to have a
Material Adverse Effect and (ii) immediately after giving effect to this Loan
Agreement (including any initial Extensions of Credit hereunder), the other Loan
Documents, and all the transactions contemplated therein or thereby to occur on
such date, (A) no Default or Event of Default exists and (B) all representations
and warranties contained herein and in the other Loan Documents are true and
correct in all material respects.
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(q) Maximum Leverage Ratio. The Leverage Ratio of the Borrowers and
their Subsidiaries, after giving effect to any initial borrowings under the Loan
Documents, is not greater than .85 to 1.00 as of the Closing Date.
(r) Intentionally Omitted.
(s) Extension of Repurchase Facility Term. The Administrative Agent
shall have received evidence reasonably satisfactory to it provided by the
Borrowers that the term of the Repurchase Agreement has been extended until
August 25, 2006.
(t) USA PATRIOT Act. The Borrowers shall have provided to the
Administrative Agent, for benefit of the Administrative Agent and the Initial
Lender, the necessary information required by the USA PATRIOT Act including,
without limitation, the identity of the Borrowers and their Subsidiaries, the
name and address of the Borrowers and their Subsidiaries and other information
that will allow the Administrative Agent or the Initial Lender, as applicable,
to identify the Borrowers and their Subsidiaries in accordance with the USA
PATRIOT Act.
(u) Additional Matters. All other documents and legal matters in
connection with the transactions contemplated by this Loan Agreement shall be
reasonably satisfactory in form and substance to the Administrative Agent and
its counsel.
Section 3.02 Conditions to All Extensions of Credit.
The obligation of the Initial Lender and any other Lender to make
any Extension of Credit hereunder is subject to the satisfaction of the
following conditions precedent on the date of making such Extension of Credit:
(a) Representations and Warranties. The representations and
warranties made by the Borrowers herein, in the Loan Documents or which are
contained in any certificate furnished at any time under or in connection
herewith shall be true and correct in all material respects on and as of the
date of such Extension of Credit as if made on and as of such date (except for
those which expressly relate to an earlier date).
(b) No Default or Event of Default. No Default or Event of Default
shall have occurred and be continuing on such date or after giving effect to the
Extension of Credit to be made on such date unless such Default or Event of
Default shall have been waived in accordance with this Loan Agreement.
(c) Compliance with Commitments. Immediately after giving effect to
the making of any such Extension of Credit (and the application of the proceeds
thereof), (i) the sum of the aggregate principal amount of outstanding Loans
shall not exceed the Revolving Commitment Amount then in effect.
(d) SPE Conditions Precedent. If not previously satisfied, on or
prior to giving effect to the making of any such Extension of Credit, each SPE
Entity shall satisfy the conditions set forth in Sections 3.01(b)(i) through (v)
and Sections 3.01(c)(i) through (iv).
(e) SPE Entity Deliverables. On or prior to giving effect to the
making of any such Extension of Credit (and the application of the proceeds
thereof), with respect to each Eligible Asset to be financed or refinanced using
any portion of Loan proceeds, the Administrative Agent shall have received a
counterpart, duly executed by a Responsible Officer of the applicable SPE Entity
of (i) a duly executed Negative Pledge Agreement in recordable form, (ii) a duly
executed joinder to the Deposit Account Control Agreement, and (iii) a duly
executed acknowledgment of the Pledge and Security Agreement (as attached
thereto as Exhibit A) and of any other Security Document (to the extent Agent
requests delivery thereof).
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(f) Certificates. The Administrative Agent shall have received a
Closing Certificate, duly executed by a Responsible Officer of the Parent.
(g) Additional Conditions to Loans. If such Loan is made pursuant to
Section 2.01, all conditions set forth in such Section shall have been
satisfied.
Each request for an Extension of Credit and each acceptance by the
Borrowers of any such Extension of Credit shall be deemed to constitute a
representation and warranty by the Borrowers as of the date of such Extension of
Credit that the applicable conditions in paragraphs (a) through (f) of this
Section have been satisfied.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01 Representations and Warranties. Each Borrower represents and
warrants to the Administrative Agent that as of the date of this Agreement and,
except where any such representation or warranty is expressly stated to have
been made as of a specific date, at all times while the Loan Documents is in
full force and effect:
(a) Solvency. The Loan Documents are not being entered into in
contemplation of insolvency or with intent to hinder, delay or defraud any of
the Borrowers' creditors. The financing contemplated hereby is not undertaken
with the intent to hinder, delay or defraud any of the Borrowers' creditors. As
of the date hereof, the Borrowers are not insolvent within the meaning of 11
U.S.C. Section 101 (32) or any successor provision thereof and the Obligations
(i) will not cause the liabilities of the Borrowers to exceed the assets of the
Borrowers, (ii) will not result in the Borrowers having unreasonably small
capital, and (iii) will not result in debts that would be beyond the Borrower's
ability to pay as the same mature.
(b) Ability to Perform. The Borrowers do not believe, nor do they
have any reason or cause to believe, that they cannot perform each and every
covenant contained in the Loan Documents applicable to it to which it is a
party.
(c) No Defaults; No Material Adverse Effect. No Default or Event of
Default or any Material Adverse Effect has occurred and is continuing hereunder.
(d) Indebtedness of Borrowers. As of the Closing Date, the
Borrowers' only Indebtedness other than Wachovia Indebtedness, is Non-Recourse
Indebtedness.
(e) Legal Name; Existence; Organizational Identification Number,
Compliance with Law. Caplease's exact legal name is Caplease, LP.; Parent's
exact legal name is Capital Lease Funding, Inc. Caplease is a limited
partnership, duly organized, validly existing and in good standing under the
laws of the State of Delaware. Parent is a REIT, duly organized, validly
existing and in good standing under the laws of the State of Maryland. Each
Borrower and each SPE Entity is qualified to do business and is in good standing
in all other jurisdictions in which the nature of the business conducted by it
makes such qualification necessary, except where failure so to qualify could not
be reasonably likely (either individually or in the aggregate) to have a
Material Adverse Effect. The Borrowers and all SPE Entities are in compliance
with all Requirements of Law except to the extent that the failure to comply
therewith could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect. The Borrowers will promptly notify the Administrative Agent of
the organizational identification number of any SPE Entity, and of any change in
such entity's organizational number.
(f) Financial Condition. The Parent has heretofore furnished to the
Administrative Agent and the Initial Lender a copy of its consolidated balance
sheets and its respective consolidated Subsidiaries, if any, as at the end of
June 30, 2005 and the related consolidated statements of income and retained
earnings and of cash flows for each Borrower as the case may be, and its
respective consolidated Subsidiaries, if any, for such period and the portion of
the fiscal year through the end of such period. Such financial statements fairly
present, in all material respects, the consolidated financial position of each
Borrower and its respective Subsidiaries as of such date in accordance with GAAP
applied on a consistent basis.
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(g) Litigation. As of the date of this Agreement there are no
actions, suits, arbitrations, investigations (including, without limitation, any
of the foregoing which are pending or to the best of the Borrowers' knowledge
threatened) affecting the Borrowers or affecting any of the assets or properties
of the Borrowers or any SPE Entity before any Governmental Authority which (i)
questions or challenges the validity or enforceability of the Loan Documents or
any action to be taken in connection with the Borrowers' obligations under the
Loan Documents, or (ii) individually or in the aggregate, if adversely
determined, could reasonably be likely to have a Material Adverse Effect.
(h) No Breach. Neither (a) the execution and delivery of the Loan
Documents nor (b) the consummation of the transactions therein contemplated to
be entered into by the Borrowers in compliance with the terms and provisions
thereof will conflict with or result in a breach of the organizational documents
of the Borrowers or any of their Subsidiaries, or any applicable law, rule or
regulation, or any order, writ, injunction or decree of any Governmental
Authority, or any material agreement or instrument to which the Borrowers are a
party or by which either of them or either of their assets or properties is
bound or to which either of them is subject, or constitute a default under any
such material agreement or instrument or result in the creation or imposition of
any Lien (except for the Liens created pursuant to the Loan Documents) upon any
assets or properties of the Borrowers or any of its Subsidiaries, pursuant to
the terms of any such agreement or instrument.
(i) Action. The Borrowers and the SPE Entities have all necessary
corporate or other power, authority and legal right to execute, deliver and
perform its obligations under each of the Loan Documents, as applicable; the
execution, delivery and performance by the Borrowers and the SPE Entities of
each of the Loan Documents have been duly authorized by all necessary corporate
action on its part; and each Loan Document has been duly executed and delivered
by the Borrowers and the SPE Entities and constitutes a legal, valid and binding
obligation of the Borrowers and the SPE Entities enforceable against the
Borrowers and the SPE Entities in accordance with its terms, subject to
bankruptcy, insolvency, and other initiations on creditors rights generally and
to equitable principals.
(j) Approvals. No authorizations, approvals or consents of, and no
filings or registrations with, any securities exchange, Governmental Authority
or any other Person are required for the execution, delivery or performance by
the Borrowers or the SPE Entities of the Loan Documents except for filings and
recordings in respect of the Liens created pursuant to the Loan Documents (other
than such authorizations, approvals, consents, filings or registrations that
have already been obtained or made, as applicable, and remain in full force and
effect).
(k) Margin Regulations and Use of Proceeds. Neither any Extension of
Credit hereunder, nor the use of the proceeds thereof, will be used (a) for any
purpose which violates, or would be inconsistent with, the provisions of
Regulation T, U or X, (b) for repurchasing any equity interest of the Borrowers
or their Subsidiaries, or (c) funding any dividends or distributions to any
holder of any Equity Interest of the Borrowers or their Subsidiaries.
(l) Taxes. The Borrowers and their Subsidiaries have filed all
Federal income tax returns and all other material tax returns that are required
to be filed by them and have paid all taxes due pursuant to such returns or
pursuant to any assessment received by them or any of their Subsidiaries, except
for any such taxes or assessments as are being appropriately contested in good
faith by appropriate proceedings diligently conducted and with respect to which
adequate reserves have been provided. The charges, accruals and reserves on the
books of the Borrowers and their Subsidiaries in respect of taxes and other
governmental charges are, in the opinion of the Borrowers, adequate.
(m) Investment Company Act. Neither of the Borrowers nor any of
their Subsidiaries is an "Investment Company," or a company "Controlled" by an
"Investment Company," within the meaning of the Investment Company Act of 1940,
as amended.
(n) Location of Books and Records. The location where each Borrower
keeps its books and records, including all computer tapes and records related to
the Eligible Assets and comprising the Eligible Assets File is its chief
executive office unless notified by Borrowers.
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(o) True and Complete Disclosure. The information, reports,
financial statements, exhibits and schedules furnished in writing by or on
behalf of the Borrowers to the Administrative Agent and the Initial Lender in
connection with the negotiation, preparation or delivery of this Agreement and
the other Loan Documents or included herein or therein or delivered pursuant
hereto or thereto, when taken as a whole, do not contain any untrue statement of
material fact or omit to state any material fact necessary to make the
statements herein or therein, in light of the circumstances under which they
were made, not misleading. All written information furnished after the date
hereof by or on behalf of the Borrowers to the Administrative Agent and the
Initial Lender in connection with this Agreement and the other Loan Documents
and the transactions contemplated hereby and thereby will be true, complete and
accurate in all material respects, or (in the case of any projections) based on
reasonable estimates, on the date as of which such information is stated or
certified. There is no fact known to a Responsible Officer of the Borrowers,
after due inquiry, that would reasonably be expected to have a Material Adverse
Effect that has not been disclosed herein, in the other Loan Documents or in a
report, financial statement, exhibit, schedule, disclosure letter or other
writing furnished to the Administrative Agent and the Initial Lender for use in
connection with the transactions contemplated hereby or thereby.
(p) ERISA. No Borrower nor any of their Subsidiaries has established
any Multiemployer Plan pursuant to ERISA, the Code or any other Federal or state
law. Each Plan to which the Borrowers or any of their respective Subsidiaries
make direct contributions, and, to the knowledge of the Borrowers, as
applicable, each other Plan, is in compliance in all material respects with, and
has been administered in all material respects in compliance with, the
applicable provisions of ERISA, the Code and any other Federal or State law.
(q) No Reliance. The Borrowers and the SPE Entities have made their
own independent decisions to enter into the Loan Documents and as to whether the
transactions contemplated thereby are appropriate and proper based upon their
own judgment and upon advice from such advisors (including without limitation,
legal counsel and accountants) as they have deemed necessary. The Borrowers and
the SPE Entities are not relying upon any advice from the Agent as to any aspect
of the transactions contemplated hereby the legal, accounting or tax treatment
of such transactions.
(r) Compliance with Anti-Money Laundering Laws. The Borrowers and
the SPE Entities have complied with all applicable anti-money laundering laws
and regulations, including without limitation the USA PATRIOT Act (collectively,
the "Anti-Money Laundering Laws"); The Borrowers have conducted the requisite
due diligence in connection with the transactions contemplated hereby for
purposes of the Anti-Money Laundering Laws.
(s) Compliance with Financial Covenants. The Borrowers are in full
compliance with the financial covenant set forth in Section 5.03 to the extent
applicable.
ARTICLE V
COVENANTS
The Borrowers hereby covenant and agree that on the Closing Date, and
thereafter for so long as this Loan Agreement is in effect and until the
Revolving Commitments have terminated, no Revolving Note remains outstanding and
unpaid and the Obligations under this Loan Agreement, together with unpaid
interest, fees and all other amounts owing to the Agent or any Lender hereunder,
are paid in full, that, to the extent applicable:
Section 5.01 Applied Covenants. The Applied Covenants shall apply herein
to the Borrowers mutatis mutandis and the Borrowers shall comply in all respects
with the terms and provisions of the Applied Covenants.
Section 5.02 Pledged Assets. Caplease shall pledge all Collateral to the
Administrative Agent and such Collateral shall be subject at all times to a
first priority, perfected Lien in favor of the Administrative Agent pursuant to
the terms and conditions of the Security Documents or such other security
documents as the Administrative Agent shall reasonably request to be executed
and delivered by the Borrowers. Caplease agrees not to further pledge any such
Collateral to any other party for as long as such Collateral is subject to the
Lien of the Security Documents.
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Section 5.03 Financial Covenants. The Leverage Ratio of the Borrowers
shall be less than or equal to 0.85 to 1.00.
Section 5.04 Certificates; Other Information. The Borrowers shall furnish
to the Agent:
(a) concurrently with the delivery of the financial statements
pursuant to Section 9.01(a)(i) of the Repurchase Agreement, a Compliance
Certificate, duly executed by a Responsible Officer of the Borrowers, certifying
as to the matters specified therein for all applicable periods specified
therein;
(b) concurrently with the delivery of any financial statements
pursuant to Section 9.01(a)(ii) of the Repurchase Agreement, a certificate of
the independent certified public accountants reporting on such financial
statements stating that in making the examination necessary therefor no
knowledge was obtained of any Default or Event of Default, except as specified
in such certificate;
(c) within three (3) Business Days after the occurrence thereof, a
notice containing information regarding the amount received in connection with
any Eligible Asset Dispositions, Debt Issuances, Equity Issuances or Recovery
Event;
(d) promptly upon receipt thereof, a copy or summary of any report
or "management letter" submitted or presented by independent accountants to the
Borrowers or any of their Subsidiaries in connection with any annual, interim or
special audit of the books of such Person;
(e) promptly upon their becoming available, copies of (i) all press
releases and other statements made available generally by the Borrowers to the
public concerning material developments in the business of the Borrowers and
their Subsidiaries and (ii) any non-routine correspondence or official notices
received by the Borrowers or any of their Subsidiaries from any Governmental
Authority which regulates the operations of the Borrowers or its Subsidiaries
which is likely to have a Material Adverse Effect; and
(f) promptly, any material report or material notice received by the
Borrowers or their Subsidiaries with respect to any Eligible Asset and such
additional financial and other information as the Administrative Agent, on
behalf of any Lender, may from time to time reasonably request.
Section 5.05 No Other Negative Pledge. None of the Borrowers or any of
their Subsidiaries that is an SPE Entity shall grant, allow or enter into any
agreement or arrangement with any Person that prohibits or restricts, or
purports to prohibit or restrict, the granting of any security interest, Lien or
other encumbrance on any of the assets or properties of the Borrowers or any SPE
Entity; provided, however, that the foregoing shall not apply to (a) Section
5.02 hereof or the Negative Pledge Agreement to be entered into in connection
herewith or (b) any other pledge or grant of any security interest, Lien or
other encumbrance on any of the assets or properties of the Borrowers or any SPE
Entity approved by the Agent in its sole discretion.
Section 5.06 Escrowed Funds. On or before any Borrowing Date, the
Borrowers shall deliver to the Agent such information as the Agent may
reasonably request with respect to each Eligible Asset for which any portion of
the Purchase Price consists of Escrowed Funds.
Section 5.07 Recourse Loans. None of the Borrowers shall incur any other
recourse Indebtedness (other than as permitted by Agent) or guaranty the
Indebtedness of any other party (other than pursuant to the Repurchase
Agreement), provided that Borrowers shall be entitled to execute non recourse
Indebtedness or non recourse carve-out guarantees on behalf of the Borrowers'
Subsidiaries of the type typically required by institutional mortgage lenders.
ARTICLE VI
EVENTS OF DEFAULT
Section 6.01 Events of Default.
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An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment Default. The Borrowers shall fail to pay any principal
on any Loan or Revolving Note when due (whether at maturity, by reason of
acceleration or otherwise) in accordance with the terms thereof or hereof; or
the Borrower shall fail to pay any interest on any Loan or Revolving Note or any
fee or other amount payable hereunder when due (whether at maturity, by reason
of acceleration or otherwise) in accordance with the terms thereof or hereof.
(b) Misrepresentation. Any representation or warranty made or deemed
made herein, in the Security Documents or in any of the other Loan Documents or
which is contained in any certificate, document or financial or other statement
furnished at any time under or in connection with this Agreement shall prove to
have been incorrect, false or misleading in any material respect on or as of the
date made or deemed made.
(c) Covenant Default. (i) The Borrowers shall fail to perform,
comply with or observe any term, covenant or agreement applicable to it
contained in Article V hereof; or (ii) the Borrowers shall fail to comply with
any other covenant contained in this Loan Agreement or the other Loan Documents
or any other agreement, document or instrument among the Borrowers, the
Administrative Agent and the Lenders or executed by the Borrowers in favor of
the Administrative Agent or the Lenders (other than as described in Sections
6.01(a) or 6.01(c)(i)), and such breach or failure to comply is not cured within
thirty (30) days after receipt of notice thereof.
(d) Debt Cross-Default. (i) (A) The occurrence of a default or an
event of default under any Obligations, (ii) the Borrowers shall fail to pay
beyond any applicable grace period (not to exceed five (5) Business Days), a
matured obligation of at least $5,000,000 on any Indebtedness (other than
Loans); (iii) the Borrowers shall default in the observance or performance of
any other agreement or condition relating to any Indebtedness (other than the
Loans) or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur or condition exist, the effect
of which default or other event or condition is to cause, or to permit the
holder or holders of such Indebtedness or beneficiary or beneficiaries of such
Indebtedness (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if required,
such Indebtedness to become due prior to its stated maturity if the aggregate
amount of such Indebtedness is at least $5,000,000.
(e) Other Cross-Defaults. The Borrowers or any of their Subsidiaries
shall default in the payment when due or in the performance or observance of any
obligation or condition of any Material Contract and such failure to pay or
perform or observe such other obligation or condition (i) involves the failure
to pay a matured obligation of at least $5,000,000, or (ii) permits the
acceleration of the maturity of obligations by any other party to or beneficiary
of such contract if the aggregate amount of such obligations is at least
$5,000,000, and continues unremedied for a period of five (5) Business Days
after notice of the occurrence of such default.
(f) Bankruptcy Default. (i) The Borrowers shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to have it judged bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or the
Borrowers shall make a general assignment for the benefit of creditors; or (ii)
there shall be commenced against the Borrowers any case, proceeding or other
action of a nature referred to in clause (i) above which (A) results in the
entry of an order for relief or any such adjudication or appointment or (B)
remains undismissed, undischarged or unbonded for a period of 60 days; or (iii)
there shall be commenced against the Borrowers any case, proceeding or other
action seeking issuance of a warrant of attachment, execution, distraint or
similar process against all or any substantial part of its assets which results
in the entry of an order for any such relief which shall not have been vacated,
discharged, or stayed or bonded pending appeal within 60 days from the entry
thereof; or (iv) the Borrowers shall take any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the acts set
forth in clause (i), (ii) or (iii) above; or (v) the Borrowers shall generally
not, or shall be unable to, or shall admit in writing its inability to, pay its
debts as they become due.
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(g) Judgment Default. One or more judgments, orders, decrees or
arbitration awards shall be entered against the Borrowers or any of their
Subsidiaries (and, solely with respect to the Borrowers and not in respect of
their Subsidiaries, involving in the aggregate a liability (to the extent not
paid when due or covered by insurance) of more than $5,000,000 or more (or
solely with respect to any Subsidiary and not in respect of the Borrowers,
involving a liability of more than $250,000)) and all such judgments, orders,
decrees or arbitration awards shall not have been paid and satisfied, vacated,
discharged, stayed or bonded pending appeal within ninety (90) days from the
entry thereof.
(h) ERISA Default. (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code)
involving any Plan, (ii) any material "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, shall exist with
respect to any Plan or any Lien in favor of the PBGC or a Plan shall arise on
the assets of the Borrowers, any of their Subsidiaries or any ERISA Affiliate,
(iii) a Reportable Event shall occur with respect to, or proceedings shall
commence to have a trustee appointed, or a trustee shall be appointed, to
administer or to terminate, any Single Employer Plan, which Reportable Event or
commencement of proceedings or appointment of a Trustee is, in the reasonable
opinion of the Requisite Lenders, likely to result in the termination of such
Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan shall
terminate for purposes of Title IV of ERISA, (v) the Borrowers, any of their
Subsidiaries or any ERISA Affiliate shall, or in the reasonable opinion of the
Requisite Lenders is likely to, incur any liability in connection with a
withdrawal from, or the insolvency or reorganization of, any Multiemployer Plan
or (vi) any other similar event or condition shall occur or exist with respect
to a Plan; and in each case in clauses (i) through (vi) above, such event or
condition, together with all other such events or conditions, if any, could
reasonably be expected to have a Material Adverse Effect.
(i) Change of Control. A Change of Control shall have occurred.
(j) Failure of Loan Documents. This Loan Agreement or any other Loan
Document or any provision hereof or thereof shall cease to be in full force and
effect or to give the Administrative Agent and/or the Lenders the security
interests, liens, rights, powers and privileges purported to be created thereby,
or the Borrowers or any Person acting by or on behalf of the Borrowers shall
deny or disaffirm such Person's obligations under this Loan Agreement or any
other Loan Document.
Section 6.02 Acceleration; Remedies.
Upon the occurrence and during the continuation of an Event of
Default, then, and in any such event, (a) if such event is an Event of Default
specified in Section 6.01(f) above, automatically the Revolving Commitments
shall immediately terminate and the Loans (with accrued interest thereon), and
all other amounts under the Loan Documents shall immediately become due and
payable, and (b) if such event is any other Event of Default, subject to the
terms of Section 6.03, with the written consent of the Requisite Lenders, the
Administrative Agent may, or upon the written request of the Requisite Lenders,
the Administrative Agent shall, take any or all of the following actions: (i) by
notice to the Borrowers declare the Revolving Commitments to be terminated
forthwith, whereupon the Revolving Commitments shall immediately terminate; (ii)
by notice of default to the Borrowers declare the Loans (with accrued interest
thereon) and all other amounts owing under this Loan Agreement and the Revolving
Notes to be due and payable forthwith and/or (iii) exercise on behalf of the
Lenders all of its other rights and remedies under this Agreement, the other
Loan Documents and applicable law. Except as expressly provided above in this
Section 6.02, presentment, demand, protest and all other notices of any kind are
hereby expressly waived by the Borrowers.
Section 6.03 Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrowers
referring to this Loan Agreement, describing such Default or Event of Default
and stating that such notice is a "notice of default." In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Requisite Lenders; provided, however, that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders except to the extent that
this Loan Agreement expressly requires that such action be taken, or not taken,
only with the consent or upon the authorization of the Requisite Lenders, or all
of the Lenders, as the case may be.
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Section 6.04 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative
Agent nor any of its Affiliates has made any representation or warranty to it
and that no act by the Administrative Agent hereinafter taken, including any
review of the affairs of the Borrowers, shall be deemed to constitute any
representation or warranty by the Administrative Agent to any Lender. Each
Lender represents to the Administrative Agent that it has, independently and
without reliance upon the Administrative Agent or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrowers and made its
own decision to make its Loans hereunder and enter into this Loan Agreement.
Each Lender also represents that it will, independently and without reliance
upon the Administrative Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Loan Agreement, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Borrowers. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of the Borrowers which may come into
the possession of the Administrative Agent or any of its Affiliates.
Section 6.05 Indemnification.
The Lenders agree to indemnify the Agent in its capacity hereunder
(to the extent not reimbursed by the Borrowers and without limiting the
obligation of the Borrowers to do so), ratably according to their respective
Revolving Commitment Percentages in effect on the date on which indemnification
is sought under this Section, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the
Revolving Notes be imposed on, incurred by or asserted against the Agent in any
way relating to or arising out of any Loan Document or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Agent under
or in connection with any of the foregoing; provided, however, that no Lender
shall be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements to the extent resulting from the Agent's gross negligence or
willful misconduct, as determined by a court of competent jurisdiction. The
agreements in this Section 6.05 shall survive the termination of this Loan
Agreement and payment of the Revolving Notes, and all other amounts payable
hereunder.
Section 6.06 The Administrative Agent in Its Individual Capacity.
The Administrative Agent and its affiliates may make loans to,
accept deposits from and generally engage in any kind of business with the
Borrowers as though the Administrative Agent were not the Administrative Agent
hereunder. With respect to the Loans made or renewed by it and any Revolving
Note issued to it, the Administrative Agent shall have the same rights and
powers under this Loan Agreement as any Lender and may exercise the same as
though it were not the Administrative Agent, and the terms "Lender" and
"Lenders" shall include the Administrative Agent in its individual capacity.
Section 6.07 Successor Administrative Agent.
The Administrative Agent may resign as Administrative Agent upon 30
days' prior written notice to the Borrowers and the Lenders provided there
exists at such time Lenders other than the Initial Lender. If the Administrative
Agent shall resign as Administrative Agent under this Loan Agreement and the
other Loan Documents, then the Requisite Lenders shall appoint from among the
Lenders a successor administrative agent for the Lenders, which successor agent
shall be approved by the Borrowers (such approval not to be unreasonably
withheld) so long as no Default or Event of Default has occurred and is
continuing, whereupon such successor administrative agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor administrative agent effective
upon such appointment and approval, and the former Administrative Agent's
rights, powers and duties as Administrative Agent shall be terminated, without
any other or further act or deed on the part of such former Administrative Agent
or any of the parties to this Loan Agreement or any holders of the Revolving
Notes. If no successor Administrative Agent has accepted appointment as
Administrative Agent within thirty (30) days after the retiring Administrative
Agent's giving notice of resignation, the retiring Administrative Agent shall
have the right, on behalf of the Lenders, to appoint a successor administrative
agent, which successor shall be approved by the Borrowers (such approval not to
be unreasonably withheld) so long as no Default or Event of Default has occurred
and is continuing; provided that such successor administrative agent has minimum
capital and surplus of at least $50,000,000. If no successor administrative
agent has accepted appointment as Administrative Agent within sixty (60) days
after the retiring Administrative Agent's giving notice of resignation, the
retiring Administrative Agent's resignation shall nevertheless become effective
and the Lenders shall perform all duties of the Administrative Agent hereunder
until such time, if any, as the Requisite Lenders appoint a successor
administrative agent as provided for above. After any retiring Administrative
Agent's resignation as Administrative Agent, the indemnification provisions of
this Loan Agreement and the other Loan Documents and the provisions of this
Article VI shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Loan Agreement.
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Section 6.08 Other Agents.
None of the Lenders or other Persons identified on the facing page
or signature pages of this Agreement as a "syndication agent," "documentation
agent," "co-agent," "book manager," "book runner," "lead manager," "arranger,"
"lead arranger" or "co-arranger" shall have any right (except as expressly set
forth herein), power, obligation, liability, responsibility or duty under this
Agreement other than, in the case of such Lenders, those applicable to all
Lenders as such. Without limiting the foregoing, none of the Lenders or other
Persons so identified shall have or be deemed to have any fiduciary relationship
with any Lender. Each Lender acknowledges that it has not relied, and will not
rely, on any of the Lenders or other Persons so identified in deciding to enter
into this Loan Agreement or in taking or not taking action hereunder.
ARTICLE VII
THE ADMINISTRATIVE AGENT
Section 7.01 Appointment.
Each Lender hereby irrevocably designates and appoints Initial
Lender as the Administrative Agent of such Lender under this Agreement, and each
such Lender irrevocably authorizes Initial Lender, as the Administrative Agent
for such Lender, to take such action on its behalf under the provisions of this
Agreement and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement, together
with such other powers as are reasonably incidental thereto. Notwithstanding any
provision to the contrary elsewhere in this Agreement, the Administrative Agent
shall not have any duties or responsibilities, except those expressly set forth
herein, or any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or otherwise exist against the Administrative Agent.
Section 7.02 Delegation of Duties.
The Administrative Agent may execute any of its duties under this
Agreement by or through agents or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care. Without
limiting the foregoing, the Administrative Agent may appoint one of its
affiliates as its agent to perform the functions of the Administrative Agent
hereunder relating to the advancing of funds to the Borrowers and distribution
of funds to the Lenders and to perform such other related functions of the
Administrative Agent hereunder as are reasonably incidental to such functions.
Section 7.03 Exculpatory Provisions.
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Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact, Subsidiaries or affiliates shall be (a)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Agreement (except for its or such Person's own
gross negligence or willful misconduct) or (b) responsible in any manner to any
of the Lenders for any recitals, statements, representations or warranties made
by the Borrowers or any of their respective subsidiaries or any officer thereof
contained in this Agreement or in any certificate, report, statement or other
document referred to or provided for in, or received by the Administrative Agent
under or in connection with, this Agreement or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of any of the Loan
Documents or for any failure of the Borrowers or any of their respective
subsidiaries to perform its obligations hereunder or thereunder. The
Administrative Agent shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance by the Borrowers or
any of their respective subsidiaries of any of the agreements contained in, or
conditions of, this Loan Agreement, or to inspect the properties, books or
records of the Borrowers or any of their respective subsidiaries.
Section 7.04 Reliance by Administrative Agent.
(a) The Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it in
good faith to be genuine and correct and to have been signed, sent or made by
the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrowers), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Revolving Note as the
owner thereof for all purposes unless an executed Commitment Transfer Supplement
has been filed with the Administrative Agent pursuant to Section 9.03(c) with
respect to the Loans evidenced by such Revolving Note. The Administrative Agent
shall be fully justified in failing or refusing to take any action under this
Agreement unless it shall first receive such advice or concurrence of the
Requisite Lenders as it deems appropriate or it shall first be indemnified to
its satisfaction by the Lenders against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such action.
The Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under any of the Loan Documents in accordance with a
request of the Requisite Lenders or all of the Lenders, as may be required under
this Agreement, and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders and all future holders of the
Revolving Notes.
(b) For purposes of determining compliance with the conditions
specified in Section 3.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender.
ARTICLE VIII
JOINT AND SEVERAL LIABILITY
Section 8.01 Joint and Several Liability; Full Recourse Obligations.
(a) Each Borrower hereby acknowledges and agrees that such Borrower
shall be jointly and severally liable to the Agent and the Lenders to the
maximum extent permitted by applicable law for all representations, warranties,
covenants, Obligations and indemnities of the Borrowers and of any Subsidiary,
including, without limitation, the SPE Entities, arising under this Loan
Agreement and the other Loan Documents, as applicable.
(b) Each Borrower hereby agrees that, to the extent the other
Borrower shall have paid more than its proportionate share of any payment made
hereunder, such Borrower shall be entitled to seek and receive contribution from
and against the other Borrower which has not paid its proportionate share of
such payment; provided, however, that the provisions of this clause shall in no
respect limit the obligations and liabilities of any Borrower to the Agent, and,
notwithstanding any payment or payments made by Borrower (the "paying Borrower")
hereunder or any set-off or application of funds of the paying Borrower by the
Agent, the paying Borrower shall not be entitled to be subrogated to any of the
rights of the Agent against any other Borrower or any collateral security or
guarantee or right of offset held by the Agent, nor shall the paying Borrower
seek or be entitled to seek any contribution or reimbursement from the other
Borrower in respect of payments made by the paying Borrower hereunder, until all
amounts owing to the Agent by the Borrower under the Loan Documents are paid in
full. If any amount shall be paid to the paying Borrower on account of such
subrogation rights at any time when all such amounts shall not have been paid in
full, such amount shall be held by the paying Borrower in trust for the Agent,
segregated from other funds of the paying Borrower, and shall, forthwith upon
receipt by the paying Borrower, be turned over to the Agent in the exact form
received by the paying Borrower (duly indorsed by the paying Borrower to the
Agent, if required), to be applied against amounts owing to the Agent by the
Borrowers under the Loan Documents, whether matured or unmatured, in such order
as the Agent may determine.
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(c) Each Borrower shall remain obligated under this Section 8.01
notwithstanding that, without any reservation of rights against such Borrower
and without notice to or further assent by such Borrower, any demand by the
Agent for payment of any amounts owing to the Agent by the other Borrower under
the Loan Documents may be rescinded by the Agent and any the payment of any such
amounts may be continued, and the liability of any other party upon or for any
part thereof, or any collateral security or guarantee therefor or right of
offset with respect thereto, may, from time to time, in whole or in part, be
renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Agent, and this Agreement and the other Loan
Documents and any other documents executed and delivered in connection therewith
may be amended, modified, supplemented or terminated, in whole or in part, as
the Agent may deem advisable from time to time, and any collateral security,
guarantee or right of offset at any time held by the Agent for the payment of
amounts owing to the Agent by the Borrowers under the Loan Documents may be
sold, exchanged, waived, surrendered or released. The Agent shall not have any
obligation to protect, secure, perfect or insure any Lien at any time held by it
as security for amounts owing to the Agent by the Borrowers under the Loan
Documents, or any property subject thereto. When making any demand hereunder
against any Borrower, the Agent may, but shall be under no obligation to, make a
similar demand on the other Borrower, and any failure by the Agent to make any
such demand or to collect any payments from the other Borrower, or any release
of such other Borrower shall not relieve any Borrower in respect of which a
demand or collection is not made or the Borrowers not so released of their
obligations or liabilities hereunder, and shall not impair or affect the rights
and remedies, express or implied, or as a matter of law, of the Agent against
the Borrowers. For the purposes hereof "demand" shall include the commencement
and continuance of any legal proceedings.
(d) Each Borrower waives any and all notice of the creation,
renewal, extension or accrual of any amounts at any time owing to the Agent by
any other Borrower under the Loan Documents and notice of or proof of reliance
by the Agent upon such Borrower or acceptance of the obligations of such
Borrower under this Section 8.01, and all such amounts, and any of them, shall
conclusively be deemed to have been created, contracted or incurred, or renewed,
extended, amended or waived, in reliance upon the obligations of the Borrowers
under this Section 8.01, and all dealings between the Borrowers, on the one
hand, and the Agent, on the other hand, likewise shall be conclusively presumed
to have been had or consummated in reliance upon the obligations of the
Borrowers under this Section 8.01. Each Borrower waives diligence, presentment,
protest, demand for payment and notice of default or nonpayment to or upon such
Borrower with respect to any amounts at any time owing to the Agent or any
Lender by such Borrower under the Loan Documents, other than such notices as are
expressly required to be given under this Agreement or any of the other Loan
Documents. Each Borrower understands and agrees that it shall continue to be
liable under this Section 8.01 without regard to (a) the validity, regularity or
enforceability of any other provision of this Agreement or any other Loan
Document, any amounts at any time owing to the Agent by the Borrowers under the
Loan Documents, or any other collateral security therefor or guarantee or right
of offset with respect thereto at any time or from time to time held by
Borrowers, (b) any defense, set-off or counterclaim (other than a defense of
payment or performance) which may at any time be available to or be asserted by
the Borrowers against the Agent, or (c) any other circumstance whatsoever (with
or without notice to or knowledge of the Borrowers) which constitutes, or might
be construed to constitute, an equitable or legal discharge of the Borrowers for
any amounts owing to the Agent by the Borrowers under the Loan Documents, or of
the Borrowers under this Agreement, in bankruptcy or in any other instance. When
pursuing its rights and remedies hereunder against the Borrowers, the Agent may,
but shall be under no obligation to, pursue such rights and remedies as it may
have against the Borrowers or any other Person or against any collateral
security or guarantee related thereto or any right of offset with respect
thereto, and any failure by the Agent to pursue such other rights or remedies or
to collect any payments from the Borrowers or any such other Person or to
realize upon any such collateral security or guarantee or to exercise any such
right of offset, or any release of the Borrowers or any such other Person or any
such collateral security, guarantee or right of offset, shall not relieve the
Borrowers of any liability hereunder, and shall not impair or affect the rights
and remedies, whether express, implied or available as a matter of law, of the
Agent against the Borrowers.
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(e) The Obligations are full recourse obligations to each Borrower
and the Borrowers hereby forever waive, demise, acquit and discharge any and all
defenses, and shall at no time assert or allege any defense, to the contrary.
ARTICLE IX
MISCELLANEOUS
Section 9.01 Amendments, Waivers and Release of Collateral.
Neither this Loan Agreement, nor any of the Revolving Notes, nor any
of the other Loan Documents, nor any terms hereof or thereof may be amended,
supplemented, waived or modified except in accordance with the provisions of
this Section nor may the Borrowers be released except in accordance with the
provisions of this Section 9.01. The Requisite Lenders may, or, with the written
consent of the Requisite Lenders, the Administrative Agent may, from time to
time, (a) enter into with the Borrowers written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Loan Agreement or the other Loan Documents or changing in
any manner the rights of the Lenders or of the Borrowers hereunder or thereunder
or (b) waive, on such terms and conditions as the Requisite Lenders may specify
in such instrument, any of the requirements of this Loan Agreement or the other
Loan Documents or any Default or Event of Default and its consequences;
provided, however, that no such waiver and no such amendment, waiver,
supplement, modification or release shall:
(i) reduce the amount or extend the scheduled date of maturity of
any Loan or Revolving Note or any installment thereon, or reduce the
stated rate of any interest or fee payable hereunder (except in connection
with a waiver of interest at the increased post-default rate which shall
be determined by a vote of the Requisite Lenders) or extend the scheduled
date of any payment thereof or increase the amount or extend the
expiration date of any Lender's Revolving Commitment, in each case without
the written consent of each Lender directly affected thereby; provided
that, it is understood and agreed that no waiver, reduction or deferral of
a mandatory prepayment required pursuant to Section 2.03(b), nor any
amendment of Section 2.03(b) or the definitions of Equity Issuance, Debt
Issuance or Recovery Event, shall constitute a reduction of the amount of,
or an extension of the scheduled date of, any principal installment of any
Loan or Revolving Note; or
(i) amend, modify or waive any provision of this Section 9.01
or reduce the percentage specified in the definition of Requisite
Lenders, without the written consent of all the Lenders; or
(ii) amend, modify or waive any provision of Article VIII
without the written consent of the Administrative Agent; or
(iii) release the Borrowers or any guarantor from its
obligations hereunder, without the written consent of all of the
Lenders and, with respect to such guarantor, any counterparty to
Interest Rate Protection Agreements; or
(iv) release all or substantially all of the Collateral
without the written consent of all of the Lenders and any
counterparty to Interest Rate Protection Agreements; or
(v) subordinate the Loans to any other Indebtedness without
the written consent of all of the Lenders; or
(vi) permit the Borrowers to assign or transfer any of its
rights or obligations under this Loan Agreement or other Loan
Documents without the written consent of all of the Lenders; or
(vii) amend, modify or waive any provision of the Loan
Documents requiring consent, approval or request of the Requisite
Lenders or all Lenders without the written consent of the Requisite
Lenders or all Lenders, as appropriate; or
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(viii) amend, modify or waive the order in which Obligations
are paid in Section 2.06(b) without the written consent of each
Lender directly affected thereby; or
(ix) without the consent of Lenders having Revolving
Commitment Percentages in the aggregate more than 50% amend, modify
or waive Section 3.02 or any other provision of this Loan Agreement
if the effect of such amendment or waiver is to require Lenders to
make Loans when such Lenders would not otherwise be required to do
so; or
(x) amend or modify the definition of Obligations to delete or
exclude any obligation or liability described therein without the
written consent of each Lender and each counterparty to an Interest
Rate Protection Agreement directly affected thereby;
provided, further, that no amendment, waiver or consent affecting
the rights or duties of the Administrative Agent under any Loan Document shall
in any event be effective, unless in writing and signed by the Administrative
Agent as applicable, in addition to the Lenders required hereinabove to take
such action.
Any such waiver, any such amendment, supplement or modification and
any such release shall apply equally to each of the Lenders and shall be binding
upon the Borrowers, the Lenders, the Administrative Agent and all future holders
of the Revolving Notes. In the case of any waiver, the Borrowers, the Lenders
and the Administrative Agent shall be restored to their former position and
rights hereunder and under the outstanding Loans and Notes and other Loan
Documents, and any Default or Event of Default waived shall be deemed to be
cured and not continuing; but no such waiver shall extend to any subsequent or
other Default or Event of Default, or impair any right consequent thereon.
Notwithstanding any of the foregoing to the contrary, the consent of
the Borrowers shall not be required for any amendment, modification or waiver of
the provisions of Article VII; provided, however, that the Administrative Agent
will provide written notice to the Borrowers of any such amendment, modification
or waiver. In addition, the Borrowers and the Lenders hereby authorize the
Administrative Agent to modify this Loan Agreement by unilaterally amending or
supplementing Schedule 1.01(B), which should contain a listing of all Lenders
and their respective Commitments from time to time in the manner requested by
the Borrowers, the Administrative Agent or any Lender in order to reflect any
assignments or transfers of the Loans as provided for hereunder; provided,
however, that the Administrative Agent shall promptly deliver a copy of any such
modification to the Borrowers and each Lender.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans, and each Lender acknowledges that the provisions of
Section 1126(c) of the Bankruptcy Code supersede the unanimous consent
provisions set forth herein and (y) the Requisite Lenders may consent to allow
the Borrowers to use cash collateral in the context of a bankruptcy or
insolvency proceeding.
Section 9.02 Survival of Representations and Warranties.
All representations and warranties made hereunder and in any
document, certificate or statement delivered pursuant hereto or in connection
herewith shall survive the execution and delivery of this Loan Agreement and the
Revolving Notes and the making of the Loans; provided that all such
representations and warranties shall terminate on the date upon which the
Revolving Commitments have been terminated and all amounts owing hereunder and
under any Revolving Notes have been paid in full.
Section 9.03 Successors and Assigns; Participations; Purchasing Lenders.
(a) This Loan Agreement shall be binding upon and inure to the
benefit of the Borrowers, the Lenders, the Administrative Agent, all future
holders of the Notes and their respective successors and assigns, except that
the Borrowers may not assign or transfer any of its rights or obligations under
this Loan Agreement or the other Loan Documents without the prior written
consent of each Lender.
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(b) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to one or more banks or other
entities ("Participants") participating interests in any Loan owing to such
Lender, any Revolving Note held by such Lender, any Revolving Commitment of such
Lender, or any other interest of such Lender hereunder, in each case in minimum
amounts of $5,000,000 (or, if less, the entire amount of such Lender's
obligations, Revolving Commitments or other interests). In the event of any such
sale by a Lender of participating interests to a Participant, such Lender's
obligations under this Loan Agreement to the other parties to this Loan
Agreement shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of any such
Revolving Note for all purposes under this Loan Agreement, and the Borrowers and
the Administrative Agent shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this Loan
Agreement. No Lender shall transfer or grant any participation under which the
Participant shall have rights to approve any amendment to or waiver of this Loan
Agreement or any other Loan Document except to the extent such amendment or
waiver would (i) extend the scheduled maturity of any Loan or Revolving Note or
any installment thereon in which such Participant is participating (it is
understood and agreed that no waiver, reduction or deferral of a mandatory
prepayment required pursuant to Section 2.03(b), nor any amendment of Section
2.03(b) or the definitions of Debt Issuance or Equity Issuance shall constitute
a reduction of the amount of, or an extension of the scheduled date of, any
principal installment of any Loan or Revolving Note), or reduce the stated rate
or extend the time of payment of interest or fees thereon (except in connection
with a waiver of interest at the increased post-default rate) or reduce the
principal amount thereof, or increase the amount of the Participant's
participation over the amount thereof then in effect (it being understood that a
waiver of any Default or Event of Default shall not constitute a change in the
terms of such participation, and that an increase in any Revolving Commitment or
Loan shall be permitted without consent of a Participant if such Participant's
participation is not increased as a result thereof), (ii) release any guarantor
from its obligations hereunto, (iii) release any material portion of the
Collateral, or (iv) consent to the assignment or transfer by the Borrowers of
any of their rights and obligations under this Loan Agreement. In the case of
any such participation, the Participant shall not have any rights under this
Loan Agreement or any of the other Loan Documents (the Participant's rights
against such Lender in respect of such participation to be those set forth in
the agreement executed by such Lender in favor of the Participant relating
thereto) and all amounts payable by the Borrowers hereunder shall be determined
as if such Lender had not sold such participation; provided that each
Participant shall be entitled to the benefits of Sections 2.10, 2.11, 2.12 and
9.04 with respect to its participation in the Revolving Commitments and the
Loans outstanding from time to time; provided, that no Participant shall be
entitled to receive any greater amount pursuant to such Sections than the
transferor Lender would have been entitled to receive in respect of the amount
of the participation transferred by such transferor Lender to such Participant
had no such transfer occurred.
(c) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time, sell or assign to any Lender or any
affiliate thereof and with the consent of the Administrative Agent (which
consent shall not be unreasonably withheld), to one or more additional banks,
insurance companies or other financial institutions or any funds investing in
bank loans ("Purchasing Lenders"), all or any part of its rights and obligations
under this Loan Agreement and the Revolving Notes in minimum amounts of
$5,000,000 (or, if less, the entire amount of such Lender's obligations),
pursuant to a Commitment Transfer Supplement, executed by such Purchasing Lender
and such transferor Lender (and, in the case of a Purchasing Lender that is not
then a Lender or an affiliate thereof, the Administrative Agent and, so long as
no Default or Event of Default has occurred and is continuing, the Borrowers),
and delivered to the Administrative Agent for its acceptance and recording in
the Register; provided, however, that any sale or assignment to an existing
Lender, an Affiliate of an existing Lender or an Approved Fund shall not require
the consent of the Administrative Agent or the Borrowers nor shall any such sale
or assignment be subject to the minimum assignment amounts specified herein.
Upon such execution, delivery, acceptance and recording, from and after the
Transfer Effective Date specified in such Commitment Transfer Supplement, (x)
the Purchasing Lender thereunder shall be a party hereto and, to the extent
provided in such Commitment Transfer Supplement, have the rights and obligations
of a Lender hereunder with a Revolving Commitment as set forth therein, and (y)
the transferor Lender thereunder shall, to the extent provided in such
Commitment Transfer Supplement, be released from its obligations under this Loan
Agreement (and, in the case of a Commitment Transfer Supplement covering all or
the remaining portion of a transferor Lender's rights and obligations under this
Loan Agreement, such transferor Lender shall cease to be a party hereto). Such
Commitment Transfer Supplement shall be deemed to amend this Loan Agreement to
the extent, and only to the extent, necessary to reflect the addition of such
Purchasing Lender and the resulting adjustment of Revolving Commitment
Percentages arising from the purchase by such Purchasing Lender of all or a
portion of the rights and obligations of such transferor Lender under this Loan
Agreement and the Revolving Notes. On or prior to the Transfer Effective Date
specified in such Commitment Transfer Supplement, the Borrowers, at their own
expense, shall execute and deliver to the Administrative Agent in exchange for
the Revolving Notes delivered to the Administrative Agent pursuant to such
Commitment Transfer Supplement new Revolving Notes to the order of such
Purchasing Lender in an amount equal to the Revolving Commitment assumed by it
pursuant to such Commitment Transfer Supplement and, unless the transferor
Lender has not retained a Revolving Commitment hereunder, new Revolving Notes to
the order of the transferor Lender in an amount equal to the Revolving
Commitment retained by it hereunder. Such new Revolving Notes shall be dated the
Closing Date and shall otherwise be in the form of the Revolving Notes replaced
thereby. The Revolving Notes surrendered by the transferor Lender shall be
returned by the Administrative Agent to the Borrower marked "canceled."
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(d) The Administrative Agent shall maintain at its principal office
a copy of each Commitment Transfer Supplement delivered to it and a register
(the "Register") for the recordation of the names and addresses of the Lenders
and the Revolving Commitment of, and principal amount of the Loans owing to,
each Lender from time to time. The entries in the Register shall be conclusive,
in the absence of manifest error, and the Borrowers, the Administrative Agent
and the Lenders may treat each Person whose name is recorded in the Register as
the owner of the Loan recorded therein for all purposes of this Loan Agreement.
The Register shall be available for inspection by the Borrowers or any Lender at
any reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of a duly executed Commitment Transfer
Supplement, together with payment to the Administrative Agent by the transferor
Lender or the Purchasing Lender (except for any assignment by a Lender to an
Affiliate of such Lender), as agreed between them, of a registration and
processing fee of $3,500 for each Purchasing Lender listed in such Commitment
Transfer Supplement and the Notes subject to such Commitment Transfer
Supplement, the Administrative Agent shall (i) accept such Commitment Transfer
Supplement and (ii) record the information contained therein in the Register.
(f) Each Borrower authorizes each Lender to disclose to any
Participant or Purchasing Lender (each, a "Transferee") and any prospective
Transferee any and all financial information in such Lender's possession
concerning the Borrowers and their Affiliates which has been delivered to such
Lender by or on behalf of the Borrowers pursuant to this Loan Agreement or which
has been delivered to such Lender by or on behalf of the Borrowers in connection
with such Lender's credit evaluation of the Borrowers and their Affiliates prior
to becoming a party to this Loan Agreement, in each case subject to Section
9.13.
(g) At the time of each assignment pursuant to this Section 9.03 to
a Person which is not already a Lender hereunder and which is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) for
federal income tax purposes, the respective assignee Lender shall provide to the
Borrowers and the Administrative Agent the appropriate Internal Revenue Service
Forms (and, if applicable, a 2.12 Certificate) described in Section 2.12.
(h) Nothing herein shall prohibit any Lender from pledging or
assigning any of its rights under this Loan Agreement (including, without
limitation, any right to payment of principal and interest under any Revolving
Note) to any Federal Reserve Bank in accordance with applicable laws.
Section 9.04 Adjustments.
(a) Each Lender agrees that if any Lender (a "Benefited Lender")
shall at any time receive any payment of all or part of its Loans, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in Section 6.01(f), or otherwise) in a greater proportion than any
such payment to or collateral received by any other Lender, if any, in respect
of such other Lender's Loans, or interest thereon, such benefited Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Loan, or shall provide such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such benefited Lender to share the excess payment or benefits
of such collateral or proceeds ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest. The Borrowers agree that each Lender so
purchasing a portion of another Lender's Loans may exercise all rights of
payment (including, without limitation, rights of set-off) with respect to such
portion as fully as if such Lender were the direct holder of such portion.
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Section 9.05 Indemnification and Expenses. Each Borrower, jointly and
severally, agrees to indemnify and hold harmless Agent, Initial Lender and each
other Lender and each of their respective affiliates and Subsidiaries and their
present and former respective officers, directors, employees, agents, advisors
and other representatives (each, an "Indemnified Party") from and against Costs
that may be incurred by or asserted or awarded against any Indemnified Party, in
each case relating to or arising out of this Agreement, any other Loan Document
or any transaction contemplated hereby or thereby, or any amendment, supplement
or modification of, or any waiver or consent under or in respect of, this
Agreement, any other Loan Document or any transaction contemplated hereby or
thereby, except for claims by an Indemnified Party against another Indemnified
Party or to the extent such Cost is found in a final, non appealable judgment by
a court of competent jurisdiction to have resulted from such Indemnified Party's
gross negligence or willful misconduct. In the case of an investigation,
litigation or other proceeding to which the indemnity in this Section 9.05
applies, such indemnity shall be effective whether or not such investigation,
litigation or proceeding is brought by any Borrowers, its directors,
shareholders or creditors or an Indemnified Party or any other Person or any
Indemnified Party is otherwise a party thereto and whether any transaction
contemplated hereby is consummated. In any suit, proceeding or action brought by
an Indemnified Party in connection with any Purchased Asset for any sum owing
thereunder, or to enforce any provisions of any agreement relating to any
Purchased Asset following a Default or Event of Default, each Borrower will
save, indemnify and hold such Indemnified Party harmless from and against all
expense, loss or damage suffered by reason of any defense, set-off,
counterclaim, recoupment or reduction or liability whatsoever of the account
debtor or obligor thereunder, arising out of a breach by any Borrower of any
obligation thereunder or arising out of any other agreement, indebtedness or
liability at any time owing to or in favor of such account debtor or obligor or
its successors from any Borrower. Each Borrower also agrees to reimburse an
Indemnified Party as and when billed by such Indemnified Party for all the
Indemnified Party's actual and reasonable out-of-pocket costs and expenses
incurred in connection with the enforcement or the preservation of the Agent's
rights under this Agreement, any other Loan Document or any transaction
contemplated hereby or thereby, including without limitation the reasonable fees
and disbursements of its counsel.
(b) Each Borrower shall, whether any transaction contemplated hereby
is consummated: (i) pay as when billed by the Agent, and in any event within
three (3) days after demand from the Agent, all reasonable out-of-pocket costs
and expenses (including, without limitation, all actual and reasonable fees and
disbursements of outside legal counsel) (A) of the Agent in connection with, the
development, preparation, execution and delivery of, and any amendment,
supplement or modification to, this Agreement, any other Loan Document or any
other documents prepared in connection herewith or therewith and the documents
and instruments referred to herein and therein (including, without limitation,
all reasonable fees, disbursements and expenses of Dechert LLP incurred as of
the date of this Agreement) and (B) of the Agent in connection with the
enforcement of this Agreement and the other Loan Documents and any amendment,
waiver or consent relating hereto or thereto and the documents and instruments
referred to herein and therein; (ii) pay and hold the Agent harmless from and
against any and all present and future stamp, documentary, issue, sales and use,
value added, property and other similar taxes (other than taxes imposed on net
income) with respect to the matters described in foregoing clause (i) and hold
the Agent harmless from and against any and all liabilities with respect to or
resulting from any delay or omission to pay such taxes; and (iii) indemnify each
Indemnified Party from and hold each of them harmless against any and all Costs
incurred by any of them as a result of, or arising out of, or in any way related
to, or by reason of, the use of the proceeds of any transaction hereunder or the
consummation of any transactions contemplated herein or in any other Loan
Document, including, without limitation, any environmental liabilities with
respect to any real estate or other assets held by the Borrowers or any of their
Affiliates (but excluding any such Costs to the extent incurred by reason of the
gross negligence or willful misconduct of the Person to be indemnified).
(c) Without prejudice to the survival of any other agreement of any
Borrower hereunder, the agreements and obligations of each Borrower contained in
this Section 9.05 shall survive the repayment of all amounts owing to the Agent
by the Borrowers under the Loan Documents and the termination of the commitment
of the Agent hereunder, for a period not to exceed, for any claim or potential
claim under this Section 9.05, the applicable statute of limitations for such
claim.
Section 9.06 Notices and Other Communications. Except as otherwise
expressly permitted by this Agreement, all notices, requests and other
communications provided for herein (including without limitation any
modifications of, or waivers, requests or consents under, this Agreement) shall
be given or made in writing (including without limitation by email, telex or
telecopy) delivered to the intended recipient at the "Address for Notices"
specified below its name on the signature pages hereof or thereof); or, as to
any party, at such other address as shall be designated by such party in a
written notice to each other party. Except as otherwise provided in this
Agreement and except for notices given under Article III (which shall be
effective only on receipt), all such communications shall be deemed to have been
duly given when transmitted by facsimile transmission or telecopy (upon receipt
of confirmation) or personally delivered or, in the case of a mailed notice,
upon receipt.
-39-
Section 9.07 Entire Agreement; Severability. This Agreement together with
the other Loan Documents constitute the entire understanding among the
Borrowers, the Agent and the Initial Lender with respect to the subject matter
it covers and shall supersede any existing agreements between the parties with
respect to the subject matter hereto. By acceptance of this Agreement, the
parties acknowledge that they have not made, and are not relying upon, any
statements, representations, promises or undertakings not contained in this
Agreement. Each provision and agreement herein shall be treated as separate and
independent from any other provision or agreement herein and shall be
enforceable notwithstanding the unenforceability of any such other provision or
agreement.
Section 9.08 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.
Section 9.09 SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL.
(A) ANY LEGAL ACTION OR PROCEEDING AGAINST THE BORROWERS WITH
RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT TO WHICH THE BORROWERS ARE
A PARTY MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF
THIS AGREEMENT, EACH BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. EACH BORROWER, FOR ITSELF, IRREVOCABLY CONSENTS TO THE SERVICE
OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO SUCH BORROWER AT ITS ADDRESS AS SHOWN ON THE SIGNATURE PAGE
OF THIS AGREEMENT, SUCH SERVICE TO BECOME EFFECTIVE FIVE (5) DAYS AFTER SUCH
MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST ANY SELLER IN ANY OTHER JURISDICTION.
(B) EACH BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS
OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (A) ABOVE AND HEREBY
FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM.
(C) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY WAIVES ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY
DEALINGS, COURSE OF DEALINGS, COURSE OF CONDUCT BETWEEN THEM, OR ANY STATEMENTS
(WHETHER ORAL OR WRITTEN) OR OTHER ACTIONS OF ANY PARTY, RELATING TO THE SUBJECT
MATTER OF THIS AGREEMENT OR THE RELATIONSHIP THAT IS BEING ESTABLISHED HEREBY,
INCLUDING, WITHOUT LIMITATION, ANY ACTION OF THE AGENT RELATING TO THE
ADMINISTRATION OR THE ENFORCEMENT OF THE LOAN DOCUMENTS, AND NONE OF THE PARTIES
HERETO WILL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A
JURY TRIAL, CANNOT BE OR HAS NOT BEEN WAIVED.
(D) EXCEPT AS PROHIBITED BY LAW, EACH BORROWER, FOR ITSELF, HEREBY
WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY SPECIAL,
EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN
ADDITION TO, ACTUAL DAMAGES. EACH BORROWER, FOR ITSELF, CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF THE AGENT OR THE INITIAL LENDER HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE AGENT WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER. THE SCOPE OF THIS WAIVER IS
INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY
COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING
WITHOUT LIMITATION CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL
OTHER COMMON LAW AND STATUTORY CLAIMS.
-40-
(E) EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL
AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL.
(F) THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF
THE OTHER LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO ANY
TRANSACTIONS CONTEMPLATED HEREBY OR ENTERED INTO HEREUNDER. IN THE EVENT OF
LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.
Section 9.10 Periodic Due Diligence Review. Each Borrower acknowledges
that the Agent has the right to perform continuing due diligence reviews with
respect to the Eligible Assets, and the Borrowers agree that upon reasonable
(but no less than three (3) Business Days) prior notice unless an Event of
Default shall have occurred and be continuing, in which case no notice is
required, to the Borrowers, the Agent or its authorized representatives will be
permitted during normal business hours to examine, inspect, and make copies and
extracts of, the Eligible Asset Files and any and all documents, records,
agreements, instruments or information relating to such Eligible Assets in the
possession or under the control of such Borrower or its Subsidiaries. Each
Borrower also shall make available to the Agent a knowledgeable financial or
accounting officer for the purpose of answering questions respecting the
Eligible Asset Files and the Eligible Assets.
Section 9.11 Termination of Repurchase Agreement; Extension of Term. The
parties intend that this Agreement and the Loan Documents shall be co-terminus
with the Repurchase Agreement and that this Loan Agreement shall terminate upon
the Termination Date. Upon the full and complete payment, performance and
discharge of all obligations of the Borrowers under the Repurchase Agreement
(whether in their respective capacities as borrowers or guarantors thereunder),
all Obligations of the Borrowers hereunder shall become immediately due and
payable. All amounts received by the Agent from the Borrowers, as applicable, in
respect of such termination of this Loan Agreement and the other Loan Documents
shall be applied in the manner contemplated in Section 2.03(b)(v). The Borrowers
shall have the right to terminate this Agreement at any time without the consent
of the Lenders or the Agent if there are no Loans outstanding hereunder.
Section 9.12 Legal Matters.
(a) If there is any conflict between the terms of this Agreement or
any other Loan Document this Agreement shall prevail.
(c) This Agreement may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument, and
any of the parties hereto may execute this Agreement by signing any such
counterpart.
(d) The captions and headings appearing herein are for included
solely for convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.
(e) Each Borrower hereby acknowledges that:
(i) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(ii) neither the Agent nor the Initial Lender has any fiduciary
relationship to any Borrower; and
(iii) no joint venture exists between the Agent or the Initial
Lender, on the one hand, and the Borrowers, on the other hand.
Section 9.13 Confidentiality. Each Borrower and the Agent hereby
acknowledge and agree that all information regarding the terms set forth in any
of the Loan Documents (the "Confidential Terms") shall be kept confidential and
shall not be divulged to any party without the prior written consent of such
other party except to the extent that (i) it is necessary to do so in working
with legal counsel, auditors, taxing authorities or other governmental agencies
or regulatory bodies or in order to comply with any applicable federal or state
laws and regulations including, without limitation, federal securities laws and
regulations applicable to any Borrower or their respective Affiliates, (ii) any
of the Confidential Terms are in the public domain other than due to a breach of
this covenant, or (iii) in the event of a Default or an Event of Default, the
Agent determines such information to be necessary or desirable to disclose in
connection with the enforcing or exercising the Agent's rights hereunder;
provided that nothing herein shall prevent any party from disclosing any such
information (i) to any other party to this Agreement, (ii) to any Transferee or
potential Transferee which agrees to comply with the provisions of this Section,
or (iii) to its Affiliates, employees, directors, agents, attorneys, accountants
and other professional advisors or other Persons deemed necessary or appropriate
in the reasonable judgment of the disclosing party, in each case who are made
aware of and instructed to comply with the provisions of this Section 9.13; and,
provided, further that no disclosure made with respect to any Loan Document
shall include a copy of such Loan Document to the extent that a summary would
suffice in lieu thereof and in the event that it is necessary for a copy of any
Loan Document to be disclosed, the specific terms set forth in such Loan
Document with respect to fees, pricing, advance rates, financial covenants and
the like shall be redacted therefrom prior to disclosure of such Loan Document
unless otherwise explicitly required to comply with any laws or regulations. The
provisions set forth in this section shall survive the termination of this
Agreement for a period of one year following such termination.
-41-
Section 9.14 Right of Set-off. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of such
rights, each Borrower hereby grants to the Agent and the Lenders a right of
offset, to secure repayment of all amounts owing to the Agent and the Lenders by
the Borrowers under the Loan Documents, upon any and all monies, securities,
collateral or other property of such Borrower and the proceeds therefrom, now or
hereafter held or received by the Agent, the Lenders or any entity under the
control of the Agent or the Lenders and their respective successors and assigns
(including, without limitation, branches and agencies of the Agent, or Lenders
wherever located), for the account of such Borrower, whether for safekeeping,
custody, pledge, transmission, collection, or otherwise, and also upon any and
all deposits (general or specified) and credits of such Borrower at any time
existing. The Agent and each Lender is hereby authorized at any time and from
time to time upon the occurrence and during the continuance of an Event of
Default, without notice to the Borrowers, to offset, appropriate, apply and
enforce such right of offset against any and all items hereinabove referred to
against any amounts owing to the Agent or Lenders by the Borrowers under the
Loan Documents, irrespective of whether the Agent or Lenders shall have made any
demand hereunder and regardless of any other collateral securing such amounts.
Each Borrower shall be deemed directly indebted to the Agent and each Lender in
the full amount of all amounts owing to the Agent and the Lenders by the
Borrowers under this Agreement, the Notes and the other Loan Documents, and the
Agent and Lenders shall be entitled to exercise the rights of offset provided
for above. ANY AND ALL RIGHTS TO REQUIRE THE AGENT OR LENDERS TO EXERCISE THEIR
RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE
AMOUNTS OWING TO THE AGENT OR LENDERS BY THE BORROWERS UNDER THE LOAN DOCUMENTS,
PRIOR TO EXERCISING ITS RIGHT OF OFFSET WITH RESPECT TO SUCH MONIES, SECURITIES,
COLLATERAL, DEPOSITS, CREDITS OR OTHER PROPERTY OF THE BORROWERS, ARE HEREBY
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED BY EACH BORROWER.
Section 9.15 Treatment of Certain Information. Notwithstanding anything to
the contrary contained herein or in any related document, all Persons may
disclose to any and all Persons, without limitation of any kind, the federal
income tax treatment of any of the transactions contemplated by this Agreement,
the other Loan Documents or any other related document, any fact relevant to
understanding the federal tax treatment of such transactions and all materials
of any kind (including opinions or other tax analyses) relating to such federal
income tax treatment.
-42-
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
date set forth above.
BORROWERS
CAPLEASE, LP
By: CLF OP GENERAL PARTNER LLC, its
General Partner
By: Capital Lease Funding, Inc., the sole
member of CLF OP GENERAL
PARTNER LLC
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
Address for Notices:
000 Xxxxxx Xxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. XxXxxxxx
Facsimile No. (000) 000-0000
CAPITAL LEASE FUNDING, INC.
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
Address for Notices:
000 Xxxxxx Xxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. XxXxxxxx
Facsimile No. (000) 000-0000
CAPLEASE SERVICES CORP.
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
Address for Notices:
000 Xxxxxx Xxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. XxXxxxxx
Facsimile No. (000) 000-0000
-S-1-
CapLease Funding
$25.0M Revolving Loan Agreement
ADMINISTRATIVE AGENT
WACHOVIA INVESTMENT HOLDINGS, LLC
By: /s/ Xxxxxxxx Xxxxxxx
Name: Xxxxxxxx Xxxxxxx
Title: Director
Address for Notices:
-------------------
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: R. Xxxxxx Xxxx
Facsimile No.: (000) 000-0000
INITIAL LENDER
WACHOVIA INVESTMENT HOLDINGS, LLC
By: /s/ Xxxxxxxx Xxxxxxx
Name: Xxxxxxxx Xxxxxxx
Title: Director
Address for Notices:
-------------------
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: R. Xxxxxx Xxxx
Facsimile No.: (000) 000-0000
-S-2-
CapLease Funding
$25.0M Revolving Loan Agreement
