Exhibit 10.32
THIRD AMENDMENT TO CREDIT AGREEMENT
AMONG
PRIME GROUP REALTY, L.P.
and
PRIME GROUP REALTY TRUST
and
BANKBOSTON, N.A.
and
PRUDENTIAL SECURITIES CREDIT CORPORATION
and
THE LENDERS PARTY HERETO
MARCH 30, 1998
TABLE OF CONTENTS
(S)1. DEFINITIONS AND RULES OF INTERPRETATION................................ 1
(S)1.1. Definitions................................................... 1
(S)1.2. Rules of Interpretation.......................................20
(S)2. REVOLVING CREDIT FACILITY..............................................21
(S)2.1. Commitment to Lend; Limitation on Total Commitment............21
(S)2.2. Reduction of Commitment.......................................21
(S)2.3. The Notes.....................................................22
(S)2.4. Interest on Loans.............................................22
(S)2.5. Requests for Loans............................................23
(S)2.6. Conversion Options............................................23
(S)2.7. Funds for Loans...............................................24
(S)2.8. IRB Indebtedness Account......................................25
(S)2.9. Letters of Credit.............................................25
(S)2.10. Assignment and Reallocation of Loans on Effective Date........28
(S)2.11. Decrease in Total Commitment on Commitment Decrease Date......29
(S)3. REPAYMENT OF THE LOANS.................................................29
(S)3.1. Maturity......................................................29
(S)3.2. Mandatory Repayments of Loan..................................29
(S)3.3. Optional Repayments of Loans..................................29
(S)4. CERTAIN GENERAL PROVISIONS.............................................31
(S)4.1. Revolving Credit Facility Fees and Agent's Fee................31
(S)4.2. Commitment Fee................................................31
(S)4.3. Funds for Payments............................................31
(S)4.4. Computations..................................................32
(S)4.5. Additional Costs, Etc.........................................32
(S)4.6. Capital Adequacy..............................................33
(S)4.7. Certificate...................................................34
(S)4.8. Indemnity.....................................................34
(S)4.9. Interest on Overdue Amounts...................................34
(S)4.10. Inability to Determine Eurodollar Rate........................34
(S)4.11. Illegality....................................................34
(S)4.12. Replacement of Lenders........................................35
(S)4.13. U.S. Tax Certificates.........................................35
(S)5. COLLATERAL SECURITY; NO LIMITATION ON RECOURSE.........................35
(S)5.1. Collateral Security.....................................................36
(S)5.2. No Limitation on Recourse...............................................36
(S)5.3. Additional Properties...................................................36
(S)5.4. Conditions to Approval of Additional Properties.........................37
(S)5.5. Release of Mortgaged Properties.........................................38
(S)6. REPRESENTATIONS AND WARRANTIES.......................................................39
(S)6.1. Authority; Etc..........................................................39
(S)6.2. Governmental Approvals..................................................40
(S)6.3. Title to Properties.....................................................40
(S)6.4. Financial Statements....................................................41
(S)6.5. No Material Changes, Etc................................................41
(S)6.6. Franchises, Patents, Copyrights, Etc....................................41
(S)6.7. Litigation..............................................................42
(S)6.8. No Materially Adverse Contracts, Etc....................................42
(S)6.9. Compliance With Other Instruments, Laws, Etc............................42
(S)6.10. Tax Status..............................................................42
(S)6.11. Event of Default........................................................43
(S)6.12. Investment Company Act..................................................43
(S)6.13. Absence of Financing Statements, Etc....................................43
(S)6.14. Setoff, Etc.............................................................43
(S)6.15. Certain Transactions....................................................43
(S)6.16. Benefit Plans: Multiemployer Plans: Guaranteed Pension Plans............43
(S)6.17. Regulations U and X.....................................................44
(S)6.18. Environmental Compliance................................................44
(S)6.19. Subsidiaries and Affiliates.............................................45
(S)6.20. Major Leases............................................................45
(S)6.21. Loan Documents..........................................................45
(S)6.22. Mortgaged Properties....................................................46
(S)7. AFFIRMATIVE COVENANTS OF THE BORROWER................................................49
(S)7.1. Punctual Payment........................................................49
(S)7.2. Maintenance of Office...................................................49
(S)7.3. Records and Accounts....................................................49
(S)7.4. Financial Statements, Certificates and Information......................49
(S)7.5. Notices.................................................................51
(S)7.6. Existence; Maintenance of REIT Status; Maintenance of Properties........52
(S)7.7. Insurance...............................................................53
(S)7.8. Taxes...................................................................53
(S)7.9. Inspection of Properties and Books; Confidential Information............54
(S)7.10. Compliance with Laws, Contracts, Licenses, and Permits..................54
(S)7.11. Use of Proceeds.........................................................54
(S)7.12. Appraisals..............................................................54
(S)7.13. Leases; Lease Approvals.................................................55
(S)7.14. Further Assurance.......................................................55
(S)7.15. Environmental Indemnification..................................................55
(S)7.16. Response Actions...............................................................56
(S)7.17. Environmental Assessments......................................................56
(S)7.18. Employee Benefit Plans.........................................................56
(S)7.19. Required Interest Rate Contracts...............................................57
(S)7.20. Equity Interests in the Company................................................57
(S)7.21. Year 2000 Problem..............................................................57
(S)8. CERTAIN NEGATIVE COVENANTS OF THE BORROWER..................................................58
(S)8.1. Restrictions on Indebtedness...................................................58
(S)8.2. Restrictions on Liens, Etc.....................................................58
(S)8.3. Restrictions on Investments....................................................60
(S)8.4. Merger, Consolidation and Disposition of Properties............................60
(S)8.5. Sale and Leaseback.............................................................61
(S)8.6. Compliance with Environmental Laws.............................................61
(S)8.7. Distributions..................................................................61
(S)8.8. Leases.........................................................................62
(S)8.9. Restrictions on the Company....................................................62
(S)9. FINANCIAL COVENANTS OF THE BORROWER.........................................................62
(S)9.1. Collateral Value...............................................................62
(S)9.2. Minimum Debt Service Coverage..................................................62
(S)9.3. Total Liabilities to Total Adjusted Assets.....................................63
(S)9.4. Minimum Tangible Net Worth.....................................................63
(S)9.5. Total Operating Cash Flow to Interest Expense..................................63
(S)9.6. EBITDA to Fixed Charges........................................................63
(S)10. CONDITIONS TO EFFECTIVENESS.................................................................63
(S)10.1. Loan Documents.................................................................63
(S)10.2. Certified Copies of Organization Documents; Good Standing Certificates.........63
(S)10.3. By-laws; Resolutions...........................................................64
(S)10.4. Incumbency Certificate; Authorized Signers.....................................64
(S)10.5. Opinions of Counsel............................................................64
(S)10.6. Payment of Fees................................................................64
(S)10.7. Validity of Liens..............................................................64
(S)10.8. Survey.........................................................................65
(S)10.9. Title Insurance; Title Exception Documents.....................................65
(S)10.10. Leases.........................................................................65
(S)10.11. Estoppel and Attornment Agreements.............................................65
(S)10.12. Certificates of Insurance......................................................65
(S)10.13. Environmental Reports..........................................................65
(S)10.14. Environmental Indemnity........................................................65
(S)10.15. Appraisals.....................................................................66
(S)10.16. Inspecting Engineers' Reports..................................................66
(S)10.17. Initial Letters of Credit......................................................66
(S)10.18. UCC Lien Searches.......................................................66
(S)11. CONDITIONS TO ALL BORROWINGS.........................................................66
(S)11.1. Representations True; No Event of Default; Compliance Certificate.......66
(S)11.2. No Legal Impediment.....................................................67
(S)11.3. Governmental Regulation.................................................67
(S)11.4. Proceedings and Documents...............................................67
(S)12. EVENTS OF DEFAULT; ACCELERATION; ETC.................................................67
(S)12.1. Events of Default and Acceleration......................................67
(S)12.2. Termination of Commitments; Drawing of IRB Letters of Credit............70
(S)12.3. Remedies................................................................70
(S)12.4. Distribution of Collateral Proceeds.....................................70
(S)12.5. Addition of Real Estate Assets to Cure Default..........................71
(S)13. SETOFF...............................................................................72
(S)14. THE AGENT............................................................................72
(S)14.1. Authorization...........................................................72
(S)14.2. Employees and Agents....................................................73
(S)14.3. No Liability............................................................73
(S)14.4. No Representations......................................................73
(S)14.5. Payments................................................................73
(S)14.6. Holders of Notes........................................................74
(S)14.7. Indemnity...............................................................74
(S)14.8. Agent as Lender.........................................................75
(S)14.9. Resignation.............................................................75
(S)14.10. Notification of Defaults and Events of Default..........................75
(S)14.11. Duties in the Case of Enforcement.......................................75
(S)14.12. Mandatory Resignation of Agent..........................................76
(S)15. EXPENSES.............................................................................76
(S)16. INDEMNIFICATION......................................................................77
(S)17. SURVIVAL OF COVENANTS, ETC...........................................................78
(S)18. ASSIGNMENT; PARTICIPATIONS; ETC......................................................78
(S)18.1. Conditions to Assignment by Lenders.....................................78
(S)18.2. Certain Representations and Warranties; Limitations; Covenants..........79
(S)18.3. Register................................................................80
(S)18.4. New Notes...............................................................80
(S)18.5. Participations..........................................................80
(S)18.6. Pledge by Lender........................................................81
(S)18.7. No Assignment by Borrower...............................................81
(S)18.8. Disclosure..............................................................81
(S)19. NOTICES, ETC.........................................................................81
(S)20. GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE...................................82
(S)21. HEADINGS.............................................................................82
(S)22. COUNTERPARTS.........................................................................83
(S)23. ENTIRE AGREEMENT.....................................................................83
(S)24. WAIVER OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS.......................................83
(S)25. CONSENTS, AMENDMENTS, WAIVERS, ETC...................................................83
(S)26. SEVERABILITY.........................................................................84
(S)27. ACKNOWLEDGMENTS......................................................................84
(S)28. PARTNER LIABILITY....................................................................84
(S)28.1. Limited Recourse to Company.............................................84
(S)28.2. Limited Recourse to Partners of Borrower other than the Company.........85
Exhibit A Form of Note
Exhibit B Form of Loan Request
Exhibit C Form of Compliance Certificate
Exhibit D Form of Letter of Credit Request
Exhibit E Opinion Requirements
Exhibit F Form of Assignment and Acceptance
Schedule 1 Lenders; Domestic and Eurodollar Lending Offices
Schedule 1.1 Mortgaged Properties
Schedule 1.2 Commitments and Commitment Percentages
Schedule 1.3 Related Companies, Guarantor Subsidiaries and Permitted Joint Ventures
Schedule 1.4 Letters of Credit
Schedule 6.3 Title to Properties
Schedule 6.7 Litigation
Schedule 6.18 Environmental Reports
Schedule 6.22(d) Engineering Reports
Schedule 6.22(l) Rent Rolls
Schedule 6.22(m) Service Agreements
Schedule 6.22(n) Other Material Agreements
Schedule 8.1(f) Recourse Indebtedness
Schedule 8.3(d) Investments
THIRD AMENDMENT TO CREDIT AGREEMENT
-----------------------------------
This Third Amendment to Credit Agreement is made as of the 30th day of
March, 1998 by and among PRIME GROUP REALTY, L.P., a Delaware limited
partnership (the "Borrower"), PRIME GROUP REALTY TRUST, a Maryland trust (the
"Company") and BANKBOSTON, N.A., a national banking association ("BankBoston"),
PRUDENTIAL SECURITIES CREDIT CORPORATION, a Delaware corporation ("Prudential"),
the other lending institutions which are from time to time listed on Schedule 1,
(collectively, with BankBoston and Prudential, the "Lenders") and BANKBOSTON,
N.A., as agent for itself and such other lending institutions (the "Agent").
WHEREAS, BankBoston and Prudential provided a secured credit facility to
the Borrower pursuant to that certain Credit Agreement dated as of November 17,
1997 as amended by First Amendment to Credit Agreement dated as of December 15,
1997 and by Second Amendment to Credit Agreement dated as of March 16, 1998 (the
"Existing Agreement"); and
WHEREAS, certain financial institutions have agreed to become Lenders and
provide Commitments as set forth on the signature pages and Schedule 1.1 hereto
and in connection therewith the parties have agreed to amend the Existing
Agreement by restating it in its entirety.
NOW, THEREFORE, the parties hereby agree that effective upon the date
hereof the Existing Agreement is amended and restated as follows:
(S)1. DEFINITIONS AND RULES OF INTERPRETATION
(S)1.1. Definitions. The following terms shall have the meanings set
forth in this (S)l or elsewhere in the provisions of this Agreement referred to
below:
Additional Properties. Real Estate Assets which hereafter become Mortgaged
Properties or Assigned Mortgage Properties pursuant to (S)5.3.
Affiliated Lenders. Any commercial bank or other commercial lender which
is (i) the parent corporation of any of the Lenders, (ii) a wholly-owned
subsidiary of any of the Lenders or (iii) a wholly-owned subsidiary of the
parent corporation of any of the Lenders.
Agent. BankBoston, N.A. acting as agent for the Lenders or any successor
agent.
Agent's Head Office. The Agent's head office located at 000 Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other location as the Agent may
designate from time to time in writing to the Borrower.
Agreement. That certain Credit Agreement dated as of November 17, 1997 as
amended by First Amendment to Credit Agreement dated as of December 15, 1997 and
by Second Amendment to Credit Agreement dated as of March 16, 1998, and as
amended and restated by this Third Amendment to Credit Agreement, including the
Schedules and Exhibits hereto.
Applicable Margin. As of any date of determination:
(i) 1.20%, if Total Liabilities are less than 30% of Total Adjusted
Assets, or
(ii) 1.35%, if Total Liabilities are equal to or less than 45% of Total
Adjusted Assets but the condition set forth in clause (i) of this definition is
not satisfied,
(iii) 1.50% if Total Liabilities exceed 45% of Total Adjusted Assets.
Any change in the Applicable Margin caused by a change in the ratio of Total
Liabilities to Total Adjusted Assets shall become effective on the 46th day
following the end of the fiscal quarter at which such ratio was computed as
shown on a Compliance Certificate which reflects such change in said ratio above
or below the 30% level or the 45% level. Notwithstanding anything to the
contrary in this definition for so long as the Continental Towers Property is an
Assigned Mortgaged Property, the Applicable Margin will be 2.00%.
Appraisals. Appraisals of the value of the Mortgaged Properties determined
on an "as is" market value basis, prepared in writing independently and
impartially by qualified MAI appraisers selected and retained by the Agent and
paid for by Borrower, the form and substance of such appraisals and final
determination of market value of the Mortgaged Properties thereunder to be
reviewed and subject to approval by the Requisite Lenders based on their
respective reviews of such appraisals pursuant to their internal appraisal
review policies and procedures. All appraisals shall be prepared in accordance
with the Uniform Standards of Professional Appraisal Practice, Supplemental
Standards Applicable To Federally Related Transactions, as further described in
Title XI of the "Financial Institutions Reform, Recovery and Enforcement Act of
1989" ("FIRREA"), and any additional standards and conditions required for
appraisals prepared for the Lead Lenders.
Appraised Value. The market value of each of the Mortgaged Properties,
determined by the Requisite Lenders based upon the most recent Appraisals
obtained pursuant to (S)5.4(b), (S)7.12 or (S)10.14. In determining Appraised
Value the Requisite Lenders shall exclude any value associated with any
unimproved land or unoccupied Buildings located on the applicable Mortgaged
Property.
Assigned Mortgaged Properties. The Real Estate Assets designated as such
on Schedule 1.1, the Buildings thereon and all other property described in the
Security Deeds relating thereto and any other Real Estate Assets, Buildings
thereon and other property described in the Security Deeds assigned to the Agent
pursuant to (S)5.3(c).
Assigned Notes. The Promissory Notes secured by the Security Deeds on the
Assigned Mortgaged Properties acquired by the Borrower and assigned to the
Agent.
Assigned Note Assignments. The Assignments of Liens and Documents from
Borrower to the Agent pursuant to which the Assigned Notes and all related loan
documents and Security
Documents are assigned to the Agent.
Assignment and Acceptance. See (S)18.
Assignments of Leases and Rents. The assignments of rents and leases from
the Mortgagor to the Agent pursuant to which the Mortgagor shall grant and
assign to the Agent as agent for the Lenders a security interest in and
assignment of the Mortgagor's interest as lessor with respect to all Leases and
rents thereunder of all or any part of the Mortgaged Properties as security for
the Obligations.
BankBoston. As defined in the preamble hereto.
Base Rate. The higher of (a) the annual rate of interest announced from
time to time by BankBoston at the Agent's Head Office as its "base rate", and
(b) one half of one percent (1/2%) above the overnight federal funds effective
rate as published by the Board of Governors of the Federal Reserve System, as in
effect from time to time.
Base Rate Loans. Those Loans bearing interest calculated by reference to
the Base Rate.
Borrower. As defined in the preamble hereto.
Borrowing Base Value. With respect to each Mortgaged Property, an amount
equal to (i) two times the Net Operating Income for the most recently completed
two fiscal quarters, minus the Reserve Amount for such Mortgaged Property,
divided by (ii) a capitalization rate equal to 0.09 for the West Xxxxxx Drive
Property or 0.10 for any other Mortgaged Property, provided however that with
respect to each Assigned Mortgaged Property, the Net Operating Income for
purposes of this definition shall be the lesser of its Net Operating Income
computed pursuant to the definition thereof or the actual amount of interest
paid (but not prepaid) on the applicable Assigned Note during such period.
Borrowing Date. The date on which any Loan is made or is to be made, and
the date on which any Loan is converted or continued in accordance with (S)2.6.
Buildings. The buildings, structures and other improvements now or
hereafter located on the Mortgaged Properties.
Building Service Equipment. All apparatus, fixtures and articles of
personal property owned by the Mortgagor now or hereafter attached to or used or
procured for use in connection with the operation or maintenance of any Building
located on or included in the Mortgaged Properties, including, but without
limiting the generality of the foregoing, all engines, furnaces, boilers,
stokers, pumps, heaters, tanks, dynamos, motors, generators, switchboards,
electrical equipment, heating, plumbing, lifting and ventilating apparatus, air-
cooling and air-conditioning apparatus, gas and electric fixtures, elevators,
escalators, fittings, and machinery and all other equipment of every kind and
description, used or procured for use in the operation of the Buildings (except
apparatus, fixtures or articles of personal property belonging to lessees or
other
occupants of such building or to persons other than the Mortgagor unless the
same be abandoned by any such lessee or other occupant or person), together with
any and all replacements thereof and additions thereto.
Business Day. Any day on which banking institutions in Boston,
Massachusetts and Chicago, Illinois are open for the transaction of banking
business and, in the case of Eurodollar Rate Loans, also a day which is a
Eurodollar Business Day.
Capitalized Leases. Leases under which the Borrower is the lessee or
obligor, the discounted future rental payment obligations under which are
required to be capitalized on the balance sheet of the Borrower in accordance
with generally accepted accounting principles.
CERCLA. See (S)6.18.
Closing Balance Sheet. The pro-forma consolidated balance sheet of the
Company dated June 30, 1997 and reflecting the closing of the Formation
Transactions contained in the Prospectus Financial Statements and the related
notes thereto.
Code. The Internal Revenue Code of 1986, as amended and in effect from time
to time.
Collateral. All of the properties of the Borrower or of any Guarantor that
are or are intended to be subject to the security interests, liens and mortgages
created by the Security Documents, including, without limitation, the Assigned
Notes, the Mortgaged Properties, the Leases, the Permits and the Service
Agreements.
Collateral Value. With respect to each Mortgaged Property an amount equal
to the lesser of its Appraised Value or its Borrowing Base Value, provided that
the Collateral Value of an Assigned Mortgaged Property shall be an amount equal
to the least of: (i) its Appraised Value, (ii) its Borrowing Base Value, (iii)
the Borrower's net acquisition cost for the Assigned Note and related documents
or (iv) the outstanding principal amount of the applicable Assigned Note and
provided that effective on April 24, 1998 the Collateral Value of the
Continental Towers Property shall become zero.
Commitment. With respect to each Lender, the amount set forth from time to
time on Schedule 1.2 hereto as the amount of such Lender 's commitment to make
Loans to the Borrower. From the Effective Date until the Commitment Decrease
Date, the Commitments of the Lead Lenders will include their Temporary
Commitments.
Commitment Decrease Date. The earlier of (i) the date that the Continental
Towers Property is released as an Assigned Mortgaged Property or (ii) April 24,
1998.
Commitment Percentage. With respect to each Lender , the percentage set
forth from time to time on Schedule 1.2 hereto as such Lender 's percentage of
the Total Commitment.
Common Shares. All common shares of beneficial interest of the Company,
including,
without limitation, those offered pursuant to the Equity Prospectus.
Common Units. Partnership interests representing the common equity in the
Borrower which interests are not subject to any mandatory redemption or entitled
to any distributions other than distributions based on the dividends paid on the
Common Shares.
Company. As defined in the preamble hereto.
Continental Towers Property. The Assigned Mortgaged Property known as
Continental Towers located at or near Golf Road, Rolling Meadows, Illinois.
Conversion Request. A notice given by the Borrower to the Agent of its
election to convert or continue a Loan in accordance with (S)2.6.
Default. See (S)12.1.
Delinquent Lender. See (S)14.5(c).
Distribution. The declaration or payment of any dividend or distribution of
cash or cash equivalents to the holders of any of the Equity Interests, or any
distribution or payment to any officer, employee or director of the Borrower or
the Company, other than reasonable employee compensation.
Dollars or $. Dollars in lawful currency of the United States of America.
Domestic Lending Office. Initially, the office of each Lender designated as
such in Schedule 1 hereto; thereafter, such other office of such Lender, if any,
located within the United States that will be making or maintaining Base Rate
Loans.
Drawing. The drawing of any Letter of Credit by the beneficiary thereof
which is paid by the Agent pursuant thereto.
Drawing Date. The date on which a draft under a Letter of Credit is paid
by the Agent.
EBITDA. The Borrower's earnings before interest, taxes, depreciation and
amortization, as determined on a consolidated basis in accordance with Generally
Accepted Accounting Principles, except that rental income shall be determined on
a cash basis.
Effective Date. The date upon which this Third Amendment to Credit
Agreement shall become effective pursuant to (S)10.
Eligible Assignee. Any of (a) a commercial bank organized under the laws of
the United States, or any State thereof or the District of Columbia, and having
total assets in excess of $1,000,000,000; (b) a savings and loan association or
savings bank organized under the laws of the United States, or any State thereof
or the District of Columbia, and having a net worth of at
least $100,000,000, calculated in accordance with generally accepted accounting
principles; (c) a commercial bank organized under the laws of any other country
which is a member of the Organization for Economic Cooperation and Development
(the "OECD"), and having total assets in excess of $1,000,000,000, provided that
such bank is acting through a branch or agency located in the country in which
it is organized or another country which is also a member of the OECD; and (d)
the central bank of any country which is a member of the OECD. Notwithstanding
anything to the contrary, the term Eligible Assignee shall exclude any Person
controlling, controlled by or under common control with, the Borrower or the
Company.
Employee Benefit Plan. Any employee benefit plan within the meaning of (S)3
(3) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate, other than a Multiemployer Plan.
Environmental Laws. See (S)6.18(a).
Environmental Reports. Reports addressed to the Agent (or addressed to the
Borrower with an acceptable reliance letter addressed to the Agent) prepared by
environmental engineering firms reasonably acceptable to the Lead Lenders
relating to environmental site assessments and other evaluations of
environmental conditions which may have been conducted with respect to the
Mortgaged Properties described in Schedule 6.18 hereto and conducted with
respect to prospective Additional Properties pursuant to (S)5.3.
Equity Interests. Collectively, all equity ownership interests in the
Borrower or the Company including, without limitation, the Common Shares, the
Preferred Shares, the Common Units and the Preferred Units.
Equity Prospectus. The prospectus dated November 12, 1997 relating to
12,380,000 Common Shares included in the Registration Statement (No. 333-33547)
of the Company on Form S-11 as filed with the Securities Exchange Commission on
August 13, 1997, as amended, as the same has been or may be further amended or
supplemented from time to time.
ERISA. The Employee Retirement Income Security Act of 1974, as amended and
in effect from time to time.
ERISA Affiliate. Any Person which is treated as a single employer with the
Borrower under (S)414 of the Code.
ERISA Reportable Event. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of (S)4043 of ERISA and the regulations
promulgated thereunder as to which the requirement of notice has not been
waived.
Eurocurrency Reserve Rate. For any day with respect to a Eurodollar Rate
Loan, the maximum rate (expressed as a decimal) at which any of the Lenders
would be required to maintain reserves under Regulation D of the Board of
Governors of the Federal Reserve System (or any successor or similar regulations
relating to such reserve requirements) against
"Eurocurrency Liabilities" (as that term is used in Regulation D) , if such
liabilities were outstanding. The Eurocurrency Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in the Eurocurrency
Reserve Rate and the Agent shall provide the Borrower with prompt written notice
of any such change.
Eurodollar Business Day. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other eurodollar interbank market as may be selected by the Agent in its sole
discretion acting in good faith.
Eurodollar Lending Office. Initially, the office of each Lender designated
as such in Schedule 1 hereto; thereafter, such other office of such Lender, if
any, that shall be making or maintaining Eurodollar Rate Loans.
Eurodollar Rate. For any Interest Period with respect to a Eurodollar Rate
Loan, the rate per annum equal to the quotient (rounded upwards to the nearest
1/16 of one percent) of (a) the rate at which the Agent is offered Dollar
deposits two Eurodollar Business Days prior to the beginning of such Interest
Period in an interbank eurodollar market where the eurodollar and foreign
currency and exchange operations of the Agent are customarily conducted, for
delivery on the first day of such Interest Period, for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Rate Loan to which such Interest Period applies, divided by (b) a number equal
to 1.00 minus the Eurocurrency Reserve Rate.
Eurodollar Rate Loans. Loans bearing interest calculated by reference to
the Eurodollar Rate.
Event of Default. See (S)12.1.
Existing Agreement. See recitals.
Facility Closing Date. November 17, 1997
Financeable Ground Lease. A ground lease satisfactory to the Requisite
Lenders and the Agent in their reasonable discretion, which must provide
protections for a leasehold mortgagee which include, among other things, (i) a
remaining term of no less than 30 years from the recording of the Security Deed
relating thereto; (ii) that the lease will not be terminated until the leasehold
mortgagee has received notice of a default, has had a reasonable opportunity to
cure or complete foreclosure, and has failed to do so; (iii) a new lease on the
same terms to the leasehold mortgagee as tenant if the ground lease is
terminated for any reason, (iv) non-merger of the fee and leasehold estates, (v)
free transferability of the tenant's interest under the ground lease and (vi)
that insurance proceeds and condemnation awards (from the fee interest as well
as the leasehold interest) will be applied pursuant to the terms of the
applicable leasehold mortgage.
Fixed Charges. With respect to any fiscal period of the Borrower, an amount
determined on a consolidated basis equal to the sum of (i) Interest Expense,
(ii) regularly scheduled installments of principal payable with respect to all
Indebtedness of Borrower, (iii) Indebtedness
which matured during such fiscal period and was not refinanced with replacement
Indebtedness plus (iv) all Distributions paid during such period to the holders
of any Preferred Shares or Preferred Units.
Fixed Rate Prepayment Fee. See (S)3.3.
Formation Transactions. The transactions described in the Equity Prospectus
which were consummated on or before the Facility Closing Date pursuant to which
(i) the Common Shares were sold pursuant to an initial public offering of such
Common Shares and certain Preferred Shares, Common Units and Preferred Units
were sold or issued in exchange for the contribution of properties; (ii) the net
proceeds thereof received by the Company were contributed as capital to the
Borrower; (iii) the Borrower directly or indirectly acquired all assets
reflected on the Closing Balance Sheet, and (iv) certain Indebtedness secured by
Liens on the Mortgaged Properties or other Real Estate Assets was repaid and
such Liens discharged.
Funds From Operations. With respect to any fiscal period of the Borrower,
an amount equal to the Borrower's Funds From Operations determined in accordance
with the definition approved by the National Association of Real Estate
Investment Trusts, except that rental income shall be determined on a cash
basis.
Generally Accepted Accounting Principles. Principles that are (a)
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, as in effect from time to time
and (b) consistently applied with past financial statements of the Borrower
adopting the same principles and with the Prospectus Financial Statements.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of (S)3(2) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate the benefits of which are guaranteed on termination in full or
in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
Guarantor. Each of the Guarantor Subsidiaries.
Guarantor Subsidiaries. The partnerships, limited liability companies and
corporations designated as Guarantor Subsidiaries on Schedule 1.3 hereto and any
other partnerships, limited liability companies or corporations hereafter
approved by the Requisite Lenders which are at least 99% owned by Borrower and
which execute and deliver a Guaranty.
Guaranty. The Unconditional Guaranty of Payment and Performance from each
Guarantor to the Agent pursuant to which such Guarantor has guaranteed the
Obligations.
Hazardous Materials. See (S)6.18(b).
Indebtedness. All obligations, contingent and otherwise, that in accordance
with Generally Accepted Accounting Principles should be classified upon the
obligor's balance sheet as liabilities, or to which reference should be made by
footnotes thereto, including in any event
the following whether or not so classified: (a) the Obligations, (b) all debt
and similar monetary obligations for borrowed money, whether direct or indirect;
(c) all liabilities secured by any mortgage, pledge, negative pledge, security
interest, lien, negative lien, charge, or other encumbrance existing on property
owned or acquired subject thereto, whether or not the liability secured thereby
shall have been assumed; (d) all guarantees, endorsements and other contingent
obligations whether direct or indirect in respect of indebtedness or obligations
of others, including any obligation to supply funds to or in any manner to
invest in, directly or indirectly, the debtor, to purchase indebtedness, or to
assure the owner of indebtedness against loss, through a master lease
transaction or an agreement to purchase goods, supplies, or services for the
purpose of enabling the debtor to make payment of the indebtedness held by such
owner or otherwise, and the obligations to reimburse the issuer in respect of
any letters of credit; and (e) joint venture and partnership obligations,
contingent or otherwise of the type set forth in (a) through (d) above.
Indebtedness shall not be deemed to include obligations under a purchase and
sale agreement or contribution agreement for the acquisition of assets by
Borrower or the Related Companies unless entered into for the purpose of
supporting the Indebtedness of the seller or contributor.
Indemnity Agreement. The Indemnity Agreement regarding Hazardous Materials
from the Borrower and the Company with respect to the Mortgaged Properties, and
any similar agreements which may be executed with respect to Additional
Properties.
Initial Letters of Credit. The Letters of Credit described on Schedule 1.4
hereto.
Inspecting Engineers' Reports. Reports addressed to the Agent (or
addressed to the Borrower with an acceptable reliance letter addressed to the
Agent) prepared by engineering firms reasonably acceptable to the Lead Lenders
relating to the structural conditions of the Buildings on the Mortgaged
Properties described in Schedule 6.22 (d) hereto and conducted with respect to
prospective Additional Properties pursuant to (S)5.3.
Interest Expense. With respect to any fiscal period of the Borrower, an
amount equal to the sum of the following with respect to all Indebtedness of the
Borrower and the Related Companies: (i) total interest expense, accrued in
accordance with Generally Accepted Accounting Principles plus (ii) all
capitalized interest determined in accordance with Generally Accepted Accounting
Principles, plus (iii) the amortization of deferred financing costs.
Interest Payment Date. As to any Base Rate Loan or Eurodollar Rate Loan,
the first day of each calendar month.
Interest Period. With respect to each Loan, (a) initially, the period
commencing on the Borrowing Date of such Loan and ending on the last day of one
of the periods set forth below, as selected by the Borrower in a Loan Request
(i) for any Base Rate Loan, the calendar month; and (ii) for any Eurodollar Rate
Loan, 1, 2 or 3 months; and (b) thereafter, each period commencing on the last
day of the next preceding Interest Period applicable to such Loan and ending on
the last day of one of the periods set forth above, as selected by the Borrower
in a Conversion Request; provided that all of the foregoing provisions relating
to Interest Periods are subject to the following:
(A) if any Interest Period with respect to a Eurodollar Rate Loan
would otherwise end on a day that is not a Eurodollar Business Day, that
Interest Period shall be extended to the next succeeding Eurodollar Business Day
unless the result of such extension would be to carry such Interest Period into
another calendar month, in which event such Interest Period shall end on the
immediately preceding Eurodollar Business Day;
(B) if any Interest Period with respect to a Base Rate Loan would end
on a day that is not a Business Day, that Interest Period shall end on the next
succeeding Business Day;
(C) if the Borrower shall fail to give notice as provided in (S)2.6,
the Borrower shall be deemed to have requested a conversion of the affected
Eurodollar Rate Loan to a Base Rate Loan on the last day of the then current
Interest Period with respect thereto;
(D) any Interest Period relating to any Eurodollar Rate Loan that
begins on the last Eurodollar Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar month at the end
of such Interest Period) shall end on the last Eurodollar Business Day of a
calendar month; and
(E) the Borrower may not select any Interest Period relating to any
Eurodollar Rate Loan that would extend beyond the Maturity Date.
Interest Rate Contracts. Interest rate swaps, caps or similar agreements
providing for interest rate protection.
Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock, partnership or
membership interests or Indebtedness of, or for loans, advances, capital
contributions or transfers of property to, or in respect of any guaranties (or
other commitments as described under Indebtedness), or obligations of, any
Person or for the acquisition of real property or other assets. In determining
the aggregate amount of Investments outstanding at any particular time
Investments shall be counted at their acquisition cost, including the value of
any Equity Interests issued in exchange for the contribution of property,
subject to the following: (a) the amount of any Investment represented by a
guaranty shall be taken at not less than the principal amount of the obligations
guaranteed and still outstanding; (b) there shall be included as an Investment
all interest accrued with respect to Indebtedness constituting an Investment
unless and until such interest is paid; (c) there shall be deducted in respect
of each such Investment any amount received as a return of capital (but only by
repurchase, redemption, retirement, repayment, liquidating dividend or
liquidating distribution); (d) there shall not be deducted in respect of any
Investment any amounts received as earnings on such Investment, whether as
dividends, interest or otherwise, except that accrued interest included as
provided in the foregoing clause (b) may be deducted when paid; and (e) there
shall not be deducted from the aggregate amount of Investments any decrease in
the value thereof.
IRB Documents. The Indentures of Trust, Financing Agreements, Loan
Agreements, Bonds, Notes and other documents relating to the IRB Indebtedness.
IRB Indebtedness. The Indebtedness of certain of the Guarantor
Subsidiaries with respect to fourteen (14) issues of industrial development
bonds, the proceeds of which were used to acquire or develop certain of the
Additional Properties listed on Schedule 5.3(b), excluding the Indebtedness of
certain Guarantor Subsidiaries with respect to such Properties in Arlington
Heights, Illinois for so long as the bonds relating thereto are held by the
Borrower or a Related Company.
IRB Indebtedness Account. A deposit account established by the Borrower
with the Agent into which the Borrower will deposit funds as required by (S)2.8
and which the Agent will debit to reimburse the amount of Drawings paid under
the IRB Letters of Credit.
IRB Letters of Credit. The Letters of Credit issued with respect to the
IRB Indebtedness for the benefit of the respective trustees named in the IRB
Documents and the Letter of Credit expiring on or before April 15, 1998 for the
benefit of Credit Suisse First Boston, which is the issuer of certain prior
letters of credit relating to certain of the IRB Indebtedness.
Lead Lenders. BankBoston and Prudential. If a Lead Lender shall enter
into one or more assignments pursuant to (S)18 which have the effect of reducing
the Commitment of such Lender to less than $20,000,000 (which number will be
proportionately reduced in the event of any reduction in the Total Commitment
pursuant to (S)2.2), then such Lender shall no longer be a Lead Lender. If by
virtue of this immediately preceding sentence there are no longer any Lead
Lenders, then all approvals, consents and other matters which require the action
by the Lead Lenders hereunder shall thereafter require the specified action by
the Requisite Lenders.
Leases. Leases, licenses and agreements whether written or oral, relating
to the use or occupation of space in or on the Buildings or on the Mortgaged
Properties by persons other than Mortgagor, including but not limited to the
leases listed on Schedule 6.22(1).
Lenders. BankBoston, Prudential and the other lending institutions listed
from time to time on Schedule 1 hereto and any other Person who becomes an
assignee of any rights of a Lender pursuant to (S)18 or a Person who acquires
all or substantially all of the stock or assets of a Lender.
Letter of Credit. A letter of credit which is one of the Initial Letters
of Credit or is hereafter issued by the Agent for the account of the Borrower
pursuant to (S)2.9.
Letter of Credit Request. See (S)2.9.
Lien. Any lien, encumbrance, mortgage, deed of trust, pledge, restriction
or other security interest. If title to any Real Estate Asset is held by a
Subsidiary of Borrower then any pledge or assignment of Borrower's stock,
partnership interest, limited liability company interest or other ownership
interest in such Subsidiary shall be deemed to be a Lien on the Real Estate
Assets owned by such Subsidiary.
Loan Documents. This Agreement, the Notes, the Guaranties, the Security
Documents, the Indemnity Agreement and any and all other agreements, documents
and instruments now or
hereafter evidencing, securing or otherwise relating to the Loans or the Letters
of Credit.
Loan Request. See (S)2.5.
Loans. Loans made or to be made by the Lenders to the Borrower pursuant to
(S)2 including, without limitation, the Loans made by the Lead Lenders under the
Existing Agreement and reallocated among the Lenders pursuant to (S)2.10.
Major Lease. A Lease of (i) 100,000 square feet or more of the gross
leasable area of a Building which is used primarily for industrial or warehouse
purposes or (ii) 25,000 square feet or more of the gross leasable area of a
Building which is used primarily for office purposes, and any guaranty of the
tenant's obligations under any such Lease.
Major Tenants. As to any Major Lease, those tenants that are parties to
that Major Lease and any guarantors of those tenants' obligations thereunder.
Material Adverse Effect. A material adverse effect on (i) any of the
Mortgaged Properties, (ii) the business, results of operations or financial
condition of the Borrower and the Related Companies taken as a whole, (iii) the
ability of the Borrower, the Company or any Guarantor to perform its obligations
under the Loan Documents, or (iv) the validity or enforceability of any of the
Loan Documents or the remedies or material rights of the Agent or the Lenders
thereunder.
Maturity Date. November 17, 2000, or such earlier date on which the Loans
shall become due and payable pursuant to the terms hereof.
Maximum Principal Amount. Maximum Principal Amount shall mean the least of
the following: (i) the maximum Outstanding Principal Amount which may exist
without causing a violation of Section 9.1; (ii) the maximum Outstanding
Principal Amount which may exist without causing a violation of Section 9.2; and
(iii) the Total Commitment.
Mortgaged Properties. The (a) Real Estate Assets described on Schedule 1.1
hereto and such other Real Estate Assets which may be subsequently conveyed to
the Agent as Additional Properties to secure the Obligations in accordance with
(S)5.3 hereof, excluding from the foregoing any Real Estate Assets which the
Agent may release pursuant to (S)5.5 hereof, as such Real Estate Assets are more
particularly described in the Security Deeds; (b) the Buildings and Building
Service Equipment located thereon and (to the extent assignable) all Permits
relating thereto; and (c) all other property incident to any of same described
in any Security Document or other Loan Document. The term Mortgaged Properties
also includes the Assigned Mortgaged Properties.
Mortgagor. With respect to each of the Mortgaged Properties, the owner
thereof.
Multiemployer Plan. Any multiemployer plan within the meaning of (S)3(37)
of ERISA maintained or contributed to by the Borrower or any ERISA Affiliate.
Net Offering Proceeds. All net cash proceeds received after the date
hereof by the Borrower or the Company as a result of the sale of common,
preferred or other classes of stock of the Company or the issuance of limited
partnership interests in the Borrower after deducting customary costs and
discounts of issuance paid by Company or Borrower in connection therewith.
Net Operating Income. With respect to any fiscal period of the Borrower and
with respect to any one or more of the Real Estate Assets, the total rental and
other operating income from the operation of such Real Estate Assets after
deducting all expenses and other proper charges incurred by the Borrower in
connection with the operation of the Mortgaged Properties during such fiscal
period, including, without limitation, real estate taxes, bad debt expenses and
management fees (which fees shall not be lower than the market rate for
management fees for similar properties in the same general location and such
management fees shall be deducted when computing Net Operating Income without
regard to the extent to which such management fees are passed through to the
tenants), but before payment or provision for Fixed Charges, income taxes, and
depreciation, amortization, and other non-cash expenses, all as determined in
accordance with Generally Accepted Accounting Principles except that (a) rental
income will be determined on a cash basis, provided, however, that each payment
of prepaid rent shall be allocated to the period for which it applies, (b)
adjustments will be made so that each fiscal quarter will include one quarter of
annual real estate tax and insurance expenses, and (c) any non-recurring income
or income not directly from the operation of such Real Estate Asset, such as
interest income, shall be excluded.
Notes. See (S)2.3.
Obligations. All indebtedness, obligations and liabilities of the Borrower
or any Guarantor to any of the Lenders and the Agent, individually or
collectively, under this Agreement or any of the other Loan Documents or in
respect of any of the Loans, the Letters of Credit or the Notes or other
instruments at any time evidencing any thereof, whether existing on the date of
this Agreement or arising or incurred hereafter, direct or indirect, joint or
several, absolute or contingent, matured or unmatured, liquidated or
unliquidated, secured or unsecured, arising by contract, operation of law of
otherwise.
Outstanding Principal Amount. The sum of (i) the aggregate amount of
unpaid principal of the Loans as of any date of determination plus (ii) the
aggregate face amount of each Letter of Credit issued under (S) 2.9 which has
not expired or terminated prior to such date of determination, excluding from
the face amount of any Letter of Credit the amount by which any Unreimbursed
Drawing has reduced the availability thereunder until such availability is
reinstated pursuant to the terms of such Letter of Credit.
PBGC. The Pension Benefit Guaranty Corporation created by (S)4002 of ERISA
and any successor entity or entities having similar responsibilities.
Permits. All governmental permits, licenses, and approvals necessary for
the lawful operation and maintenance of the Mortgaged Properties.
Permitted Acquisition. The acquisition by Borrower or any Related Company
of Real Estate Assets which are located in the continental United States and are
leased or intended to be leased primarily for industrial or office purposes.
Permitted Joint Ventures. Any entity in which Borrower has any direct or
indirect ownership interest, except the Company and the Related Companies and
except Prime Group Realty Services, Inc., including general partnerships,
corporations, trusts and limited liability companies, which own or propose to
develop industrial or office properties provided that neither Borrower or any
Guarantor shall have any recourse liability for the Indebtedness of such entity.
Permitted Joint Ventures existing on the date hereof are set forth in Schedule
1.3.
Permitted Developments. The construction of any new buildings or the
construction of additions expanding existing buildings or the rehabilitation of
the existing buildings (other than normal refurbishing and tenant fit up work
when one tenant leases space previously occupied by another tenant) relating to
any Real Estate Assets of the Borrower or any of the Related Companies and each
Permitted Development shall be counted for purposes of (S)8.3 from the time of
commencement of the applicable construction work until the later of (i) the date
that leases for at least 70% of the gross leasable area of such project have
been executed or (ii) the date that a final certificate of occupancy has been
issued with respect to such project, in the amount of the total projected cost
of such project.
Permitted Liens. Liens, security interests and other encumbrances
permitted by (S)8.2.
Person. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
Pledge Agreements. The Pledge and Security Agreements between each
Guarantor Subsidiary which is a borrower under any IRB Documents and the Agent
pursuant to which certain bonds purchased with the proceeds of Drawings under
the IRB Letters of Credit would be pledged to the Agent until such bonds are
remarketed or redeemed.
Pledged Bonds. Bonds pledged to the Agent pursuant to any Pledge
Agreement.
Preferred Shares. All Preferred Shares of beneficial interest of the
Company including, without limitation, the 2,000,000 shares of Series A
Cumulative Convertible Preferred Shares as described in the Equity Prospectus.
Preferred Units. All partnership interests in the Borrower other than the
Common Units, including, without limitation, the Preferred Units described in
the Equity Prospectus.
Prepayment Date. See (S)3.3.
Prime. The Prime Group, Inc., an Illinois corporation.
Pro Forma Debt Service Charges for the Mortgaged Properties. For any
fiscal quarter of
the Borrower, an amount equal to three monthly principal and interest payments
based on a twenty-five (25) year mortgage style amortization schedule,
calculated on the Pro Forma Principal Amount and an interest rate equal to the
greater of (i) the then current weighted average interest rate per annum on the
Loans or (ii) the then current ten (10) year U.S. Treasury xxxx yield plus 1.75%
per annum.
Pro Forma Principal Amount. (a) With respect to Compliance Certificates
delivered pursuant to (S)7.4(e), the maximum Outstanding Principal Amount at any
time during the applicable fiscal quarter; (b) with respect to Compliance
Certificates delivered pursuant to (S)2.5, 2.9(b) or (S)11.1, the Outstanding
Principal Amount after giving effect to the requested Loan or the issuance of
the requested Letter of Credit; (c) with respect to Compliance Certificates
delivered pursuant to (S)5.5 or (S)8.4(b), the Outstanding Principal Amount
after giving effect to any proposed sale or transfer including any payments on
the Loans or cancellation of Letters of Credit to be made in connection
therewith.
Properties. All Real Estate Assets, Real Estate, and all other assets,
including, without limitation, intangibles and personalty owned by the Borrower.
Prospectus Financial Statements. The Financial Statements relating to the
Company and relating to certain properties to be acquired by the Borrower or its
Subsidiaries in connection with the Formation Transactions as set forth in the
Equity Prospectus.
Prudential. As defined in the preamble thereto.
Real Estate. All real property at any time owned, leased (as lessee or
sublessee) or operated by the Borrower, any Guarantor, or any of the Related
Companies or any Permitted Joint Venture. The term Real Estate also includes
the properties subject to the Security Deeds relating to the Assigned Mortgaged
Properties.
Real Estate Assets. Those fixed and tangible properties consisting of
land, buildings and/or other improvements owned by the Borrower, by any
Guarantor, by any of the Related Companies or by any Permitted Joint Venture at
the relevant time of reference thereto, including without limitation, the
Mortgaged Properties, but excluding all leaseholds other than Financeable Ground
Leases. The term Real Estate Assets also includes the properties subject to the
Security Deeds relating to the Assigned Mortgaged Properties.
Record. The grid attached to any Note, or the continuation of such grid,
or any other similar record, including computer records, maintained by any
Lender with respect to any Loan referred to in such Note.
Recourse Indebtedness. All Indebtedness except Indebtedness with respect
to which recourse for payment is contractually limited (except for customary
exclusions) to specific assets encumbered by a lien securing such Indebtedness.
Register. See (S)18.3.
Related Companies. The entities listed and described on Schedule 1.3
hereto, or thereafter, any entity whose financial statements are consolidated or
combined with the Borrower's pursuant to Generally Accepted Accounting
Principles, or any ERISA Affiliate.
Release. See (S)6.18(c)(iii).
Requisite Lenders. As of any date, the Lenders whose aggregate Commitments
constitute at least sixty-six percent (66%) of the Total Commitment provided
that the Agent must always be among the Requisite Lenders (except that (i) all
determinations by the Requisite Lenders pursuant to (S)2.5 as to whether the
conditions in (S)11 have been met and (ii) all actions by the Requisite Lenders
after an Event of Default with respect to acceleration of the Loans and the
enforcement of the Loan Documents as provided in (S)12 and in (S)14.11, shall be
made without regard to whether the Agent is among the Requisite Lenders) and
provided that the Temporary Commitments and the Commitments of any Delinquent
Lenders shall be disregarded when determining the Requisite Lenders.
Reserve Amount. With respect to any Real Estate Assets or group of Real
Estate Assets, a normalized annual reserve for capital expenditures, tenant
improvements, replacement reserves and leasing costs at the rate of $0.25 per
year per square foot of gross leasable area contained in all buildings on such
Real Estate Assets. When the Reserve Amount is used in computing an amount with
respect to a fiscal period which is shorter than a year, said amount shall be
appropriately prorated.
Responsible Officer. With respect to the Company, any one of its Chief
Executive Officer, Chief Financial Officer, Treasurer or Executive Vice
Presidents.
Security Deeds. The mortgages and deeds of trust from the Mortgagor to the
Agent pursuant to which the Mortgagor shall convey the Mortgaged Properties as
security for the Obligations and the mortgages which secure the Assigned Notes
and which are assigned to the Agent pursuant to the Assigned Note Assignments.
Security Documents. The Security Deeds, the Assignments of Leases and
Rents, the Pledge Agreements and the UCC-1 financing statements, the Assigned
Note Assignments and all documents securing the Assigned Notes assigned thereby.
Service Agreements. All service agreements between the Borrower and third
parties, whether written or oral, relating to the operation, maintenance,
security, finance or insurance of the Mortgaged Properties.
Subsidiary. Any corporation, partnership, limited liability company,
association, trust, or other business entity of which the designated parent or
other controlling Person shall at any time own directly or indirectly through a
Subsidiary or Subsidiaries at least a majority (by number of votes) of the
outstanding Voting Interests.
Surveys. Instrument surveys of the Mortgaged Properties dated or updated
to a date not
more than six (6) months prior to the date the applicable property becomes a
Mortgaged Property hereunder, which shall show the location of all Buildings,
easements and utility lines on the Mortgaged Properties, shall be sufficient to
remove the survey exception from the Title Policy, shall show that all Buildings
are within the lot lines of the Mortgaged Properties, shall not show any
material encroachments by others, and shall show whether or not the Mortgaged
Properties are located in any flood hazard district as established by the
Federal Emergency Management Agency or any successor agency or are located in
any flood plain, flood hazard or wetland protection district established under
federal, state or local law and in addition shall meet the then applicable
standards of the Agent.
Syndication Lenders. The Lenders which are parties to this Third Amendment
to Credit Agreement other than the Lead Lenders.
Tangible Net Worth. Total Assets minus Total Liabilities minus all
intangibles determined in accordance with Generally Accepted Accounting
Principles.
Temporary Commitments. The Commitments of the Lead Lenders designated as
Temporary Commitments on Schedule 1.2 hereof which are to be terminated and paid
in full on the Commitment Decrease Date.
Title Insurance Company. Chicago Title Insurance Company.
Title Policy. For each Mortgaged Property an ALTA standard form title
insurance policy issued by the Title Insurance Company (with such reinsurance or
co-insurance as the Agent may require, any such reinsurance to be with direct
access endorsements) insuring the priority of the Security Deed and Assignment
of Leases and Rents and that the Mortgagor holds good and clear record
marketable fee simple title to the Mortgaged Property, subject only to the
encumbrances permitted by the applicable Security Deed or otherwise acceptable
to the Agent in its reasonable discretion and which shall not contain exceptions
for mechanics liens, persons in occupancy (other than Leases listed on Schedule
6.22(1)) or matters which would be shown by a survey (other than matters
approved by the Agent in its reasonable discretion), shall not insure over any
matter except to the extent that any such affirmative insurance is acceptable to
the Agent in its sole discretion (after consultation with the Lead Lenders), and
shall contain such endorsements and affirmative insurance as the Agent in its
reasonable discretion may require, including but not limited to (a)
comprehensive endorsement, (b) variable rate of interest endorsement, (c) usury
endorsement, (d) revolving credit endorsement, (e) doing business endorsement,
(f) ALTA form 3.1 zoning endorsement, with parking, (g) survey (same-as)
endorsement (h) access endorsement, (i) tie-in endorsement, (j) first loss
endorsement, and (k) tax parcel endorsement, to the extent that such
endorsements are available in the state where the applicable Mortgaged Property
is located.
Total Adjusted Assets. The sum of (i) the assets classified as cash or
cash equivalents on the consolidated balance sheet of Borrower prepared in
accordance with Generally Accepted Accounting Principles as of the end of the
most recent fiscal quarter (including any restricted cash other than tenant
deposits), plus (ii) the product of (a) EBITDA for the most recent two
fiscal quarters, times (b) two, divided by (c) 0.0975. EBITDA used to compute
Total Adjusted Assets will be computed on a pro forma basis as though the assets
reflected on the consolidated balance sheet of Borrower prepared in accordance
with Generally Accepted Accounting Principles as of the end of the most recent
fiscal quarter had been owned since the first day of the applicable period of
two fiscal quarters and as though all assets disposed of prior to the date of
such balance sheet had been disposed of prior to the first day of the applicable
period of two fiscal quarters.
Total Assets. The aggregate book value of all assets of the Borrower and
the Related Companies consolidated and determined in accordance with Generally
Accepted Accounting Principles plus accumulated depreciation and amortization
related to Real Estate Assets.
Total Commitment. The sum of the Commitments of the Lenders, as in effect
from time to time.
Total Liabilities. The sum of the following (without duplication): (i) all
liabilities of the Borrower and the Related Companies consolidated and
determined in accordance with Generally Accepted Accounting Principles excluding
accounts payable incurred in the ordinary course of business, (ii) all
Indebtedness of the Borrower and the Related Companies whether or not so
classified, including, without limitation, all outstanding Loans under this
Agreement, and (iii) the balance available for drawing under letters of credit
issued for the account of the Borrower or any of the Related Companies.
Total Operating Cash Flow. With respect to any fiscal period of the
Borrower (i) EBITDA minus (ii) the Reserve Amount with respect to all Real
Estate Assets owned by the Borrower or any of the Related Companies.
Type. As to any Loan its nature as a Base Rate Loan or a Eurodollar Rate
Loan.
Unreimbursed Drawing. Any Drawing other than a Drawing which is reimbursed
by the Agent debiting the IRB Indebtedness Account pursuant to (S)2.8. If any
reimbursement from the IRB Indebtedness Account or any part thereof is rescinded
or must otherwise be restored or returned by the Agent upon the insolvency,
bankruptcy or reorganization of the Borrower or any Guarantor, the Drawing
reimbursed thereby shall be deemed to be an Unreimbursed Drawing.
Unused Amount. See (S)4.2
Variable Rate Indebtedness. The Loans and all other Indebtedness of the
Borrower which bears interest at a rate which is not fixed through the maturity
of such Indebtedness.
Voting Interests. Stock or similar ownership interests, of any class or
classes (however designated), the holders of which are at the time entitled, as
such holders, (a) to vote for the election of a majority of the directors (or
persons performing similar functions) of the corporation, association,
partnership, trust or other business entity involved, or (b) to control, manage
or conduct the business of the corporation, partnership, association, trust or
other
business entity involved.
West Xxxxxx Drive Property. The Mortgaged Property located at 00 Xxxx
Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx, as more particularly described in the Security
Deed with respect thereto.
(S)1.2. Rules of Interpretation.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to time in
accordance with its terms and the terms of this Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted successors
and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by Generally Accepted Accounting Principles applied on
a consistent basis by the accounting entity to which they refer and, except as
otherwise expressly stated, all use of accounting terms with respect to the
Borrower shall reflect the consolidated financial statements of Borrower and the
Related Companies.
(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by Generally
Accepted Accounting Principles, which terms are defined in the Uniform
Commercial Code as in effect in New York, have the meanings assigned to them
therein.
(h) Reference to a particular "(S)" refers to that section of
this Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of like
import shall refer to this Agreement as a whole and not to any particular
section or subdivision of this Agreement.
(j) The words "so long as any Loan or Note is outstanding" shall
mean so long as such Loan or Note is not paid in full in cash.
(S)2. REVOLVING CREDIT FACILITY.
(S)2.1. Commitment to Lend; Limitation on Total Commitment. Subject to
the provisions of (S)2.5 and the other terms and conditions set forth in this
Agreement, each of the Lenders severally agrees to lend to the Borrower and the
Borrower may borrow, repay, and reborrow from time to time between the Facility
Closing Date and the Maturity Date upon notice
by the Borrower to the Agent given and approved by the Agent in accordance with
(S)2.5, such sums as are requested by the Borrower up to a maximum aggregate
principal amount outstanding (after giving effect to all amounts requested) at
any one time equal to such Lender 's Commitment (minus such Lender's Commitment
Percentage of the face amount of the Letters of Credit outstanding), provided
that the Outstanding Principal Amount (after giving effect to all amounts
requested) shall not at any time exceed the Maximum Principal Amount. The Loans
shall be made pro rata in accordance with each Lender's Commitment Percentage
and the Lenders shall at all times immediately adjust inter se any inconsistency
between each Lender 's outstanding principal amount and each Lender's
Commitment. Each request for a Loan hereunder shall constitute a representation
and warranty by the Borrower that the conditions set forth in (S)10 or (S)11
(whichever is applicable) have been satisfied on the date of such request and
will be satisfied on the proposed Borrowing Date of the requested Loan, provided
that the making of such representation and warranty by Borrower shall not limit
the right of any Lender not to lend upon a determination by the Requisite
Lenders that such conditions have not been satisfied.
(S)2.2. Reduction of Commitment. The Borrower shall have the right, after
the Commitment Decrease Date and prior to the Maturity Date, upon at least ten
(10) Business Days' prior written notice to the Agent, to reduce by $1,000,000
or an integral multiple of $100,000 in excess thereof, a portion of the Total
Commitment which exceeds the Outstanding Principal Amount, provided that the
Total Commitment shall not be reduced to less than the sum of $100,000,000 plus
the aggregate face amount of Letters of Credit then outstanding rounded up to
the nearest $1,000,000, whereupon the Commitments of the Lenders shall be
reduced pro rata in accordance with their respective Commitment Percentages by
the amount specified in such notice. Upon the effective date of any such
reduction, the Borrower shall pay to the Agent for the respective accounts of
the Lenders the full amount of any commitment fee then accrued on the amount of
the reduction. No reduction of the Commitments may be reinstated.
(S)2.3. The Notes. The Loans shall be evidenced by separate promissory
notes of the Borrower in substantially the form of Exhibit A hereto (each a
"Note"), and completed with appropriate insertions. One or more Notes shall be
payable to the order of each Lender in a principal amount equal to such Lender
's Commitment. The Notes executed and delivered as of the Effective Date shall
replace the Notes executed and delivered to the Lead Lenders pursuant to the
Existing Agreement. The Borrower irrevocably authorizes each Lender to make or
cause to be made, at or about the time of the Borrowing Date of any Loan or at
the time of receipt of any payment of principal on such Lender 's Note, an
appropriate notation on such Lender 's Record reflecting the making of such Loan
or (as the case may be) the receipt of such payment. The outstanding amount of
the Loans set forth on such Lender 's Record shall (absent manifest error) be
prima facie evidence of the principal amount thereof owing and unpaid to such
Lender, but the failure to record, or any error in so recording, any such amount
on the Record shall not limit or otherwise affect the obligations of the
Borrower hereunder or under any Note to make payments of principal of or
interest on any Note when due.
(S)2.4. Interest on Loans.
(a) Each Base Rate Loan shall bear interest for the period commencing
with the Borrowing Date thereof and ending on the last day of the Interest
Period with respect thereto at the Base Rate.
(b) Each Eurodollar Rate Loan shall bear interest for the period
commencing with the Borrowing Date thereof and ending on the last day of the
Interest Period with respect thereto at the rate equal to the Applicable Margin
per annum above the Eurodollar Rate determined for such Interest Period.
(c) The Borrower unconditionally promises to pay interest on each
Loan in arrears on each Interest Payment Date with respect thereto.
(d) It is the intention of the parties hereto to conform strictly to
the usury and similar laws relating to interest from time to time in force, and
all agreements among Borrower, Guarantors, the Agent and the Lenders set forth
in the Loan Documents are hereby expressly limited so that in no contingency or
event whatsoever, whether by acceleration of maturity of Loans or otherwise,
shall the amount paid or agreed to be paid as interest hereunder or under the
other Loan Documents exceed the maximum rate or amount of interest permissible
under applicable usury laws or such other laws (the "Maximum Interest Amount").
In the event, for any reason whatsoever, any payment by or act of Borrower or
any Guarantor pursuant to the terms or pursuant to any requirements of any of
the Loan Documents shall result in or require payment of interest which would
exceed the Maximum Interest Amount, then ipso facto the obligation of Borrower
or such Guarantor, as the case may be, to pay interest or fees or other amounts
shall be reduced to the Maximum Interest Amount, so that in no event shall
Borrower or any Guarantor be obligated to pay any interest, perform any act, or
be bound by any requirement which would result in payment of interest in excess
of a sum which is lawfully collectible, and all sums in excess of those lawfully
collectible as interest shall, without further agreements or notice between or
by any party to this Agreement or any other Loan Document, be deemed applied to
pay the principal of the Loans immediately upon receipt of such moneys by Agent
or any Lender, with the same force and effect as though Borrower or any
Guarantor had specifically designated such sums to be applied to principal
prepayment. The provisions of this (S)2.4(d) shall control every other provision
of the Loan Documents.
(S)2.5. Requests for Loans. The Borrower shall give to the Agent written
notice in the form of Exhibit B hereto of each Loan requested hereunder (a "Loan
Request") no less than (a) three (3) Business Days prior to the proposed
Borrowing Date of any Base Rate Loan and (b) four (4) Eurodollar Business Days
prior to the proposed Borrowing Date of any Eurodollar Rate Loan. Each such
notice shall specify (i) the principal amount of the Loan requested, (ii) the
proposed Borrowing Date of such Loan, (iii) the Interest Period for such Loan,
(iv) the Type of such Loan, and (v) the purpose of such Loan, and shall be
accompanied by a statement in the form of Exhibit C hereto signed by a
Responsible Officer setting forth in reasonable detail computations evidencing
compliance with the covenants contained in (S)9 hereof after giving effect to
such requested Loan (a "Compliance Certificate"). Within one (1) Business Day
after receipt of a Loan Request, the Agent shall provide to each of the Lenders
by facsimile a copy of
such Loan Request and accompanying Compliance Certificate and each Lender shall,
within 24 hours thereafter, notify the Agent if it believes that any of the
conditions contained in (S)11 of this Agreement has not been met or waived. If
such a notice is given the Requisite Lenders shall promptly determine whether
all of the conditions contained in (S)11 of this Agreement have been met or
waived. If no such notice is given by any Lender or if following such notice the
Requisite Lenders determine that the conditions contained in (S)11 have been met
or waived, each of the Lenders shall be obligated to fund its Commitment
Percentage of the requested Loans. Each such Loan Request shall be irrevocable
and binding on the Borrower and the Borrower shall be obligated to accept the
Loan requested from the Lenders on the proposed Borrowing Date. Each Loan
Request shall be in a minimum aggregate amount of $3,000,000 or an integral
multiple of $1,000,000 in excess thereof.
(S)2.6. Conversion Options.
(a) The Borrower may elect from time to time to convert any
outstanding Loan to a Loan of another Type, provided that (i) with respect to
any such conversion of a Eurodollar Rate Loan to a Base Rate Loan, the Borrower
shall give the Agent at least three (3) Business Days' prior written notice of
such election; (ii) with respect to any such conversion of a Eurodollar Rate
Loan into a Base Rate Loan, such conversion shall only be made on the last day
of the Interest Period with respect thereto; (iii) subject to the further
proviso at the end of this section and subject to (S)2.6(b) and (S)2.6(d) hereof
with respect to any such conversion of a Base Rate Loan to a Eurodollar Rate
Loan, the Borrower shall give the Agent at least four (4) Eurodollar Business
Days' prior written notice of such election and (iv) no Loan may be converted
into a Eurodollar Rate Loan when any Default or Event of Default has occurred
and is continuing. On the date on which such conversion is being made, each
Lender shall take such action as is necessary to transfer its Commitment
Percentage of such Loans to its Domestic Lending Office or its Eurodollar
Lending Office, as the case may be. All or any part of outstanding Loans of any
Type may be converted as provided herein, provided further that each Conversion
Request relating to the conversion of a Base Rate Loan to a Eurodollar Rate Loan
shall be for an amount equal to $3,000,000 or an integral multiple of $1,000,000
in excess thereof and shall be irrevocable by the Borrower.
(b) Any Loans of any Type may be continued as such upon the
expiration of an Interest Period with respect thereto by compliance by the
Borrower with the notice provisions contained in (S)2.6 (a) ; provided that no
Eurodollar Rate Loan may be continued as such when any Default or Event of
Default has occurred and is continuing but shall be automatically converted to a
Base Rate Loan on the last day of the first Interest Period relating thereto
ending during the continuance of any Default or Event of Default of which the
officers of the Agent active upon the Borrower's account have actual knowledge.
(c) In the event that the Borrower does not notify the Agent of
its election hereunder with respect to any Loan, such Loan shall be
automatically converted to or continued as a Base Rate Loan at the end of the
applicable Interest Period.
(d) The Borrower may not request a Eurodollar Rate Loan pursuant
to (S)2.5, elect
to convert a Base Rate Loan to a Eurodollar Rate Loan pursuant to (S)2.5(a) or
elect to continue a Eurodollar Rate Loan pursuant to (S)2.6(b) if, after giving
effect thereto, there would be greater than eight (8) Eurodollar Rate Loans
outstanding. Any Loan Request for a Eurodollar Rate Loan that would create
greater than eight (8) Eurodollar Rate Loans outstanding shall be deemed to be a
Loan Request for a Base Rate Loan.
(S)2.7. Funds for Loans.
(a) Subject to (S)2.5 and other provisions of this Agreement, not
later than 11:00 a.m. (Boston time) on the proposed Borrowing Date of any Loans,
each of the Lenders will make available to the Agent, at the Agent's Head
Office, in immediately available funds, the amount of such Lender's Commitment
Percentage of the amount of the requested Loans. Upon receipt from each Lender
of such amount, and upon receipt of the documents required by (S)(S)10 or 11
(whichever is applicable) and the satisfaction of the other conditions set forth
therein, to the extent applicable, the Agent will make available to the Borrower
the aggregate amount of such Loans made available to the Agent by the Lenders.
The failure or refusal of any Lender to make available to the Agent at the
aforesaid time and place on any Borrowing Date the amount of its Commitment
Percentage of the requested Loans shall not relieve any other Lender from its
several obligation hereunder to make available to the Agent the amount of such
other Lender's Commitment Percentage of any requested Loans but shall not
obligate any other Lender or Agent to fund more than its Commitment Percentage
of the requested Loans or to increase its Commitment Percentage.
(b) The Agent may, unless notified to the contrary by any Lender
prior to a Borrowing Date, assume that such Lender has made available to the
Agent on such Borrowing Date the amount of such Lender's Commitment Percentage
of the Loans to be made on such Borrowing Date, and the Agent may (but it shall
not be required to), in reliance upon such assumption, make available to the
Borrower a corresponding amount. If any Lender makes available to the Agent such
amount on a date after such Borrowing Date, such Lender shall pay to the Agent
on demand an amount equal to the product of (i) the average computed for the
period referred to in clause (iii) below, of the weighted average interest rate
paid by the Agent for federal funds acquired by the Agent during each day
included in such period, times (ii) the amount of such Lender's Commitment
Percentage of such Loans, times (iii) a fraction, the numerator of which is the
number of days or portion thereof that elapsed from and including such Borrowing
Date to the date on which the amount of such Lender's Commitment Percentage of
such Loans shall become immediately available to the Agent, and the denominator
of which is 365.
(S)2.8. IRB Indebtedness Account. On or before each date on which there is
scheduled to be a Drawing under any IRB Letter of Credit pursuant to the IRB
Documents, the Borrower will deposit in the IRB Indebtedness Account sufficient
funds such that there will be available therein on the applicable Drawing Date
the amount needed to reimburse the Agent for the amount of such Drawing. The
Borrower hereby authorizes the Agent to debit the IRB Indebtedness Account on
each Drawing Date as necessary to reimburse the Agent for each draft paid by the
Agent pursuant to any IRB Letter of Credit. All payments made by the Agent
pursuant to any
drafts under the IRB Letters of Credit shall be made from funds of the Agent,
but in no event shall any such payments be made with funds from the IRB
Indebtedness Account or with any other funds obtained from the Borrower, any
Guarantor or any issuer of bonds with respect to any IRB Indebtedness.
(S)2.9. Letters of Credit.
(a) A portion of the Commitments may be used by Borrower for the issuance
of Letters of Credit by the Agent for the account of the Borrower subject to the
terms and conditions set forth herein, provided that the aggregate face amount
of all Letters of Credit shall not exceed $40,000,000 during the period from the
Effective Date until the date that all of the IRB Letters of Credit listed on
Schedule 1.4 are cancelled and terminated and thereafter shall not exceed
$15,000,000. Each Letter of Credit shall be denominated in dollars and shall be
a either a direct pay IRB Letter of Credit, a direct pay letter of credit
supporting bond related Indebtedness similar to the IRB Letters of Credit or a
standby letter of credit issued to support the obligations of Borrower in
connection with Permitted Developments. Each Letter of Credit shall expire no
later than five (5) Business Days prior to the Maturity Date. Although the Agent
shall be the issuing bank of the Letter of Credit, each Lender hereby accepts
for its own account and risk an undivided interest equal to its Commitment
Percentage in the Agent's obligations represented by each Letter of Credit
issued hereunder, and unconditionally and irrevocably agrees with the Agent
that, upon any Unreimbursed Drawing, such Lender shall promptly pay to the Agent
an amount equal to such Lender's Commitment Percentage of the amount of such
Unreimbursed Drawing. Upon the issuance of each Letter of Credit hereunder,
there shall be reserved from each Lender 's Commitment an amount equal to such
Lender's Commitment Percentage of the face amount of the Letter of Credit. Such
reserved amounts shall remain in place and shall be unavailable for borrowing
under (S)2.1 until the date that the Letter of Credit expires or is terminated.
(b) If the Borrower shall desire the issuance of any Letters of Credit or
the extension or renewal of any outstanding Letters of Credit, it shall give to
the Agent a written notice in the form of Exhibit D hereto of each Letter of
Credit requested hereunder (a "Letter of Credit Request") no less than ten (10)
Business Days prior to the proposed issuance date of the requested Letter of
Credit or prior to the expiration date of any Letter of Credit to be renewed or
extended. Each Letter of Credit Request shall specify (i) the name and address
of the beneficiary of the requested Letter of Credit, (ii) the face amount of
the requested Letter of Credit, (iii) the proposed issuance date and expiration
date of the requested Letter of Credit, (iv) the proposed form of the requested
Letter of Credit, and (v) the permitted purpose for which the Letter of Credit
will be used, and shall be accompanied by a Compliance Certificate in the form
of Exhibit C hereto signed by a Responsible Officer setting forth in reasonable
detail computations evidencing compliance with the covenants contained in (S) 9
hereof after including in the Outstanding Principal Amount the face amount of
the requested Letter of Credit. The Agent may also require that the Borrower
complete its standard letter of credit application form and submit the same and
the standard application fee together with the Letter of Credit Request. The
Letter of Credit Requests with respect to the Initial Letters of Credit are
hereby approved. Within two (2) Business Days after receipt of any other Letter
of Credit Request, the Agent shall provide to
each of the Lenders by facsimile a copy of such Letter of Credit Request and
accompanying Compliance Certificate and each Lender shall, within 24 hours
thereafter, notify the Agent if it believes that any of the conditions contained
in (S)11 of this Agreement has not been met or waived such that a Loan in an
amount equal to the face amount of the requested Letter of Credit could be made
on the proposed issuance date of such Letter of Credit. If such a notice is
given the Requisite Lenders shall promptly determine whether all of the
conditions contained in (S)11 of this Agreement have been met or waived. If no
such notice is given by any Lender or if following such notice the Requisite
Lenders determine that the conditions contained in (S)11 have been met or
waived, and if the Agent determines, in its discretion, that it is willing to
issue, extend or renew the requested Letter of Credit, and that it is satisfied
with the proposed form thereof, the Letter of Credit shall be issued, extended
or renewed by the Agent and each of the Lenders shall then be obligated to the
Agent with respect to its Commitment Percentage of the Letter of Credit (as
extended or renewed, if applicable) as provided above in (S) 2.9(a).
(c) On or before the issuance date of any Letters of Credit having an
expiration date of one year or less after its issuance date, the Borrower shall
pay to the Agent for its own account an issuance fee equal to one-eighth percent
(.125%) of the face amount of the Letter of Credit. The issuance fee for any
Letter of Credit with a later expiration date will be determined by the Agent.
On or before the date of any extension or renewal of a Letter of Credit, the
Borrower shall pay to the Agent for its own account a renewal fee for each year
of the extension renewal term equal to one-tenth percent (.10%) of the face
amount of the applicable Letter of Credit. The Borrower shall pay to the Agent
for the account of the Lenders a Letter of Credit fee equal to the then
prevailing Applicable Margin per annum of the face amount of the Letter of
Credit, which Letter of Credit fee shall be due and payable in advance on the
issuance date of the Letter of Credit and on the first day of each calendar
quarter for so long as such Letter of Credit remains outstanding, and shall be
prorated for any partial quarter and paid for the actual number of days between
the issuance date and the expiration date of such Letter of Credit. Promptly
after its receipt thereof the Agent shall distribute such Letter of Credit fee
to the Lenders pro-rata in accordance with their respective Commitment
Percentages. Such fees shall be nonrefundable and shall not be further prorated
in the event that the Letter of Credit terminates prior to its scheduled
expiration date. The Borrower also agrees to reimburse the Agent for all
reasonable fees (consistent with the fee schedule of the Agent's trade services
division as then in effect), costs, expenses and disbursements of the Agent in
issuing, effecting payment under, amending or otherwise administering any Letter
of Credit.
(d) Promptly after each Unreimbursed Drawing the Agent shall notify the
Lenders and the Borrower of the amount thereof. The payment of each Unreimbursed
Drawing shall constitute an advance of a Loan which shall bear interest as a
Base Rate Loan from the Drawing Date. On the Drawing Date of each Unreimbursed
Drawing, each Lender shall pay to the Agent its Commitment Percentage of the
amount of such Unreimbursed Drawing. If the Agent receives such payment from any
Lender on a date after the Drawing Date, such Lender shall pay to the Agent on
demand an amount computed in the same manner as the amount due to the Agent from
a Lender which has made available funds for loans after the Borrowing Date
thereof pursuant to (S)2.7(b). Each Lender's obligation to pay its Commitment
Percentage of each Unreimbursed Drawing shall not be subject to the satisfaction
of the conditions set forth in (S)11. Within three
(3) Business Days after each Unreimbursed Drawing, the Borrower shall deliver to
the Agent a written explanation of the facts and circumstances relating to such
drawing and a Compliance Certificate and any other information requested by the
Agent for the purpose of allowing the Lenders to determine whether the drawing
or related events have resulted in a Default or Event of Default. The Agent
shall promptly provide copies of such explanation and information to the
Lenders.
(e) The Borrower's obligations under this (S) 2.9 shall be absolute and
unconditional under any and all circumstances and irrespective of any set-off,
counterclaim or defense to payment which the Borrower may have or have had
against the Agent, any Lender or any beneficiary of a Letter of Credit. The
Borrower also agrees that the Agent shall not be responsible for, and the
Borrower's reimbursement obligations hereunder shall not be affected by, among
other things, (i) the validity or genuineness of documents or of any
endorsements thereon, even though such documents shall in fact prove to be
invalid, fraudulent or forged, or (ii) any dispute between or among the Borrower
and any beneficiary of any Letter of Credit or any other party to which such
Letter of Credit may be transferred or (iii) any claims whatsoever of the
Borrower against any beneficiary of such Letter of Credit or any such
transferee. The Agent shall not be liable for any error, omission, interruption
or delay in transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit, except for errors,
omissions, interruptions or delays for which the Agent is liable under the
Uniform Customs and Practices for Documentary Credits. The Borrower assumes all
risks of the acts or omissions of any trustee, paying agent, tender agent or
remarketing agent under the IRB Indebtedness and the Agent shall not be
responsible for any use which may be made of the IRB Letters of Credit. The
Borrower agrees that any action taken or omitted by the Agent under or in
connection with any Letter of Credit or the related drafts or documents, if done
in accordance with the standards of care specified in the Uniform Customs and
Practices for Documentary Credits as the same may be amended from time to time,
shall be binding on the Borrower and shall not result in any liability of the
Agent to the Borrower or to any Guarantor.
(f) In the event that any Letters of Credit are in effect at the time of
an acceleration of the maturity of the Loans pursuant to (S)12.1, the amounts
which shall thereupon become immediately due and payable by the Borrower shall
include a sum equal to the aggregate face amount of such then effective Letters
of Credit. Such sum shall be deposited in a cash collateral account to be opened
by the Agent. Amounts held in such cash collateral account shall be applied by
the Agent on each Drawing Date thereafter to pay any drafts presented pursuant
to the Letters of Credit. After all Letters of Credit have been fully drawn
upon, expired or otherwise terminated, any balance remaining in such cash
collateral account shall be applied in the same manner as enforcement proceeds
under (S)12.4.
(S)2.10. Assignment and Reallocation of Loans on Effective Date. On the
Effective Date the Lead Lenders shall be deemed to have assigned to the
Syndication Lenders, and the Syndication Lenders shall be deemed to have assumed
from the Lead Lenders, a portion of the Lead Lenders' rights and obligations
under this Agreement relating to the Commitment and the Commitment Percentage
allocated to the Syndication Lenders, respectively, on Schedule 1.2. One half of
the interests so assigned to each Syndication Lender shall be deemed to have
been
assigned by each Lead Lender. The Borrower acknowledges that the outstanding
principal balance of the Loans on the Effective Date is $172,500,000 and that
the Borrower has no offsets, claims or defenses with respect to such outstanding
Loans. On the Effective Date the outstanding principal balance of the Loans
shall be reallocated among the Lead Lenders and the Syndication Lenders such
that after the Effective Date the outstanding principal amount of Loans owed to
each Lender shall be equal to such Lender's Commitment Percentage of the
outstanding amount of all Loans. Not later than 11:00 a.m. (Boston time) on the
Effective Date each of the Syndication Lenders will make available to the Agent
at the Agent's Head Office in immediately available funds, the amount of such
Lender's Commitment Percentage of the outstanding principal amount of the Loans
which amounts will be distributed equally to the Lead Lenders for their own
account. In addition, the Lead Lenders shall receive and retain for their own
account 100% of the interest and unused commitment fees payable by the Borrower
hereunder attributable to the period from the Facility Closing Date through and
including the Effective Date.
(S)2.11. Decrease in Total Commitment on Commitment Decrease Date. On the
Commitment Decrease Date the Temporary Commitments of the Lead Lenders will be
terminated. The payment from the Borrower to be received by the Agent on the
Commitment Decrease Date shall be distributed among the Lenders so that after
the Commitment Decrease Date the outstanding principal amount of Loans owed to
each Lender shall be equal to such Lender's Commitment Percentage (after the
Commitment Decrease Date) of the outstanding amount of all Loans.
(S)3. REPAYMENT OF THE LOANS.
(S)3.1. Maturity. The Borrower unconditionally promises to pay on the
Maturity Date, and there shall become absolutely due and payable on the Maturity
Date, all of the Loans outstanding on such date, together with any and all
accrued and unpaid interest and charges thereon.
(S)3.2. Mandatory Repayments of Loan. If at any time the sum of the
Outstanding Principal Amount exceeds the Maximum Principal Amount, then the
Borrower shall immediately pay the amount of such excess to the Agent for the
respective accounts of the Lenders for application to the Loans.
(S)3.3. Optional Repayments of Loans. The Borrower shall have the right,
at its election, to repay the outstanding amount of the Loans, as a whole or in
part, on any Business Day, without penalty or premium; provided that the full or
partial prepayment of the outstanding amount of any Eurodollar Rate Loans made
pursuant to this (S)3.3 may be made only on the last day of the Interest Period
relating thereto, except as set forth below in this (S)3.3. The Borrower shall
give the Agent no later than 10:00 a.m., Boston time, at least three (3)
Business Days' prior written notice of any prepayment pursuant to this (S)3.3 of
any Base Rate Loans and four (4) Eurodollar Business Days, notice of any
proposed repayment pursuant to this (S)3.3 of any Eurodollar Rate Loans,
specifying the proposed date of payment of Loans and the principal amount to be
paid. The Agent shall promptly provide a copy of such notice to each Lender.
Each
such partial prepayment of the Loans shall be in an integral multiple of
$100,000 and shall be accompanied by the payment of all charges outstanding on
all Loans and of accrued interest on the principal repaid to the date of payment
and shall be applied, in the absence of instruction by the Borrower, first to
the principal of Base Rate Loans and then to the principal of Eurodollar Rate
Loans. Notwithstanding anything contained herein to the contrary, the Borrower
may make a full or partial prepayment of a Eurodollar Rate Loan on a date other
than the last day of the Interest Period relating thereto, if all optional
prepayments (in whole or in part) on such Loans shall be accompanied by, and the
Borrower hereby promises to pay, a prepayment fee in an amount determined by the
Agent in the following manner:
(i) Fixed Rate Prepayment Fee. Borrower acknowledges that prepayment
or acceleration of a Eurodollar Loan during an Interest Period shall result in
the Lenders incurring additional costs, expenses and/or liabilities and that it
is impractical to ascertain the extent of such costs, expenses and/or
liabilities. (For all purposes of this Section, any Loan not being made as a
Eurodollar Rate Loan in accordance with the Loan Request therefor, as a result
of Borrower's cancellation thereof, shall be treated as if such Eurodollar Rate
Loan had been prepaid.) Therefore, on the date a Eurodollar Rate Loan is prepaid
or the date all sums payable hereunder become due and payable, by acceleration
or otherwise ("Prepayment Date"), Borrower will pay to Agent, for the account of
each Lender, (in addition to all other sums then owing), an amount ("Fixed Rate
Prepayment Fee") determined by the Agent to be the amount, if any, by which (i)
the amount of interest which would have accrued on the prepaid Eurodollar Rate
Loan for the remainder of the Interest Period at the rate applicable to such
Eurodollar Rate Loan exceeds (ii) the amount of interest that would accrue for
the same period on any readily marketable bond or other obligation of the United
States of America designated by the Agent in its sole discretion at or about the
time of such payment, such bond or other obligation of the United States of
America to be in an amount equal (as nearly as may be) to the amount of
principal so paid or not borrowed and to have a maturity comparable to the
remainder of such Interest Period, and the interest to accrue thereon to take
account of amortization of any discount from par or accretion of premium above
par at which the same is selling at the time of designation.
(ii) Upon the written notice to Borrower from Agent, Borrower shall
immediately pay to Agent, for the account of the Lenders, the Fixed Rate
Prepayment Fee. Such written notice (which shall include calculations in
reasonable detail) shall, in the absence of manifest error, be conclusive and
binding on the parties hereto.
(iii) Borrower understands, agrees and acknowledges the following:
(i) no Lender has any obligation to purchase, sell and/or match funds in
connection with the use of the Eurodollar Rate as a basis for calculating the
rate of interest on a Eurodollar Rate Loan; (ii) the Eurodollar Rate is used
merely as a reference in determining such rate; and (iii) Borrower has accepted
the Eurodollar Rate as a reasonable and fair basis for calculating such rate and
a Fixed Rate Prepayment Fee. Borrower further agrees to pay the Fixed Rate
Prepayment Fee, if any, whether or not a Lender elects to purchase, sell and/or
match funds.
(S)4. CERTAIN GENERAL PROVISIONS.
(S)4.1. Revolving Credit Facility Fees and Agent's Fee. The Borrower has
paid to the Lead Lenders and the Agent revolving credit facility fees and agency
fees in the amounts specified in the Fee Agreement dated October 20, 1997 among
the Lead Lenders, BancBoston Securities, Inc., the Borrower, the Company and The
Prime Group, Inc., as amended. Borrower agrees to pay the Agent the annual
agency fee due on each anniversary of the Facility Closing Date as set forth in
said Fee Agreement. The Lead Lenders shall be responsible for any facility fees
which they may agree to pay to the other Lenders which become a party to this
Agreement. If the Borrower obtains releases of one or more Mortgaged Properties
pursuant to (S)5.5, and simultaneously or thereafter provides Additional
Properties pursuant to (S)5.3 and (S)5.4 to replace the Collateral Value of the
released property, the Borrower shall pay a substitution fee to the Agent for
its own account in the amount of $2,500 per Additional Property.
(S)4.2. Commitment Fee. The Borrower shall pay to the Agent for the
accounts of the Lenders in accordance with their respective Commitment
Percentages a commitment fee calculated at the rates set forth below per annum
on the daily amount by which the Total Commitment (as it may have been reduced
pursuant to (S)2.2) exceeds the Outstanding Principal Amount (the "Unused
Amount"):
Unused Amount Fee Rate
------------- --------
less than 1/3 of Total Commitment 15 basis points
at least 1/3 of Total Commitment
but less than 2/3 of Total Commitment 20 basis points
at least 2/3 of Total Commitment 25 basis points
The commitment fee shall be payable on the basis of the applicable annual rate
quarterly in arrears on the first day of each calendar quarter for the
immediately preceding calendar quarter commencing on the first such date
following the date hereof, with a final payment on the Maturity Date or any
earlier date on which the Commitments shall terminate.
(S)4.3. Funds for Payments.
(a) All payments of principal, interest, closing fees, commitment
fees and any other amounts due hereunder (other than as provided in (S)4.1,
(S)4.5 and (S)4.6) or under any of the other Loan Documents, and all
prepayments, shall be made to the Agent, for the respective accounts of the
Lenders, at the Agent's Head Office, in each case in Dollars in immediately
available funds.
(b) All payments by the Borrower hereunder and under any of the
other Loan Documents shall be made without setoff or counterclaim and free and
clear of and without deduction for any taxes, levies, imposts, duties, charges,
fees, deductions, withholdings, compulsory liens, restrictions or conditions of
any nature now or hereafter imposed or levied by any jurisdiction or any
political subdivision thereof or taxing or other authority therein unless the
Borrower is compelled by law to make such deduction or withholding. If any such
obligation is imposed upon the Borrower with respect to any amount payable by it
hereunder or under any of
the other Loan Documents, the Borrower shall pay to the Agent, for the
account of the Lenders or (as the case may be) the Agent, on the date on which
such amount is due and payable hereunder or under such other Loan Document, such
additional amount in Dollars as shall be necessary to enable the Lenders or the
Agent to receive the same net amount which the Lenders or the Agent would have
received on such due date had no such obligation been imposed upon the Borrower.
The Borrower will deliver promptly to the Agent certificates or other valid
vouchers for all taxes or other charges deducted from or paid with respect to
payments made by the Borrower hereunder or under such other Loan Document.
(S)4.4. Computations. All computations of interest on the Loans and of
other fees to the extent applicable shall be based on a 360-day year and paid
for the actual number of days elapsed. Except as otherwise provided in the
definition of the term "Interest Period" with respect to Eurodollar Rate Loans,
whenever a payment hereunder or under any of the other Loan Documents becomes
due on a day that is not a Business Day, the due date for such payment shall be
extended to the next succeeding Business Day, and interest shall accrue during
such extension. The outstanding amount of the Loans as reflected on the Records
from time to time shall (absent manifest error) be considered correct and
binding on the Borrower unless within thirty (30) Business Days after receipt by
the Agent or any of the Lenders from Borrower of any notice by the Borrower of
such outstanding amount, the Agent or such Lender shall notify the Borrower to
the contrary.
(S)4.5. Additional Costs, Etc. If any present or future applicable law
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Lender or the Agent by any central bank or other fiscal,
monetary or other authority (whether or not having the force of law), shall:
(a) subject any Lender or the Agent to any tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature with respect to this
Agreement, the other Loan Documents, such Lender's Commitment or the Loans
(other than taxes based upon or measured by the net income or profits of such
Lender or the Agent), or
(b) materially change the basis of taxation (except for changes
in taxes on net income or profits) of payments to any Lender of the principal of
or the interest on any Loans or any other amounts payable to any Lender under
this Agreement or the other Loan Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Agreement) any special
deposit, reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held by, or
deposits in or for the account of, or loans by, or commitments of an office of
any Lender, or
(d) impose on any Lender any other conditions or requirements
with respect to this Agreement, the other Loan Documents, the Loans, the
Commitment, or any class of loans or
commitments of which any of the Loans or the Commitment forms a part;
and the result of any of the foregoing is
(i) to increase the cost to such Lender of making, funding, issuing,
renewing, extending or maintaining any of the Loans or such Lender's
Commitment, or
(ii) to reduce the amount of principal, interest or other amount
payable to such Lender or the Agent hereunder on account of the Commitments or
any of the Loans, or
(iii) to require such Lender or the Agent to make any payment or to
forego any interest or other sum payable hereunder, the amount of which payment
or foregone interest or other sum is calculated by reference to the gross amount
of any sum receivable or deemed received by such Lender or the Agent from the
Borrower hereunder,
Then, and in each such case, the Borrower will, upon demand made by such Lender
or (as the case may be) the Agent at any time and from time to time and as often
as the occasion therefor may arise, pay to such Lender or the Agent, to the
extent permitted by law, such additional amounts as will be sufficient to
compensate such Lender or the Agent for such additional cost, reduction, payment
or foregone interest or other sum.
(S)4.6. Capital Adequacy. If any present or future law, governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law) or the interpretation thereof by a court or governmental authority with
appropriate jurisdiction affects the amount of capital required or expected to
be maintained by banks or bank holding companies and any Lender or the Agent
determines that the amount of capital required to be maintained by it is
increased by or based upon the existence of its Commitment or the Loans made or
deemed to be made pursuant hereto, then such Lender or the Agent may notify the
Borrower of such fact, and the Borrower shall pay to such Lender or the Agent
from time to time on demand, as an additional fee payable hereunder, such amount
as such Lender or the Agent shall determine in good faith and certify in a
notice to the Borrower to be an amount that will adequately compensate such
Lender or the Agent in light of these circumstances for its increased costs of
maintaining such capital. Each Lender and the Agent shall allocate such cost
increases among its customers in good faith and on an equitable basis.
(S)4.7. Certificate. A certificate setting forth any additional amounts
payable pursuant to (S)(S)4.5 or 4.6 and a brief explanation of such amounts
which are due, submitted by any Lender or the Agent to the Borrower, shall be
prima facie evidence that such amounts are due and owing.
(S)4.8. Indemnity. In addition to the other provisions of this Agreement
regarding any such matters, the Borrower agrees to indemnify each Lender and to
hold each Lender harmless from and against any loss, cost or reasonable expense
(including loss of anticipated profits) that such Lender may sustain or incur as
a consequence of (a) a default by the Borrower in payment of the principal
amount of or any interest on any Eurodollar Rate Loans as and when due and
payable, including any such loss or expense caused by Borrower's breach or other
default and arising from interest or fees payable by such Lender to lenders of
funds obtained by it in order to
maintain its Eurodollar Rate Loans, (b) a default by the Borrower in making a
borrowing or conversion after the Borrower has given (or is deemed to have
given) a Loan Request or a Conversion Request, and (c) the making of any payment
of a Eurodollar Rate Loan or the making of any conversion of a Eurodollar Rate
Loan to a Base Rate Loan on a day that is not the last day of the applicable
Interest Period with respect thereto, including interest or fees payable by such
Lender to lenders of funds obtained by it in order to maintain any such
Eurodollar Rate Loan.
(S)4.9. Interest on Overdue Amounts. Overdue principal and (to the extent
permitted by applicable law) interest on the Loans and all other overdue amounts
payable hereunder or under any of the other Loan Documents shall bear interest
compounded monthly and payable on demand at a rate per annum equal to four
percent (4%) above the Base Rate until such amount shall be paid in full (after
as well as before judgment). In addition, the Borrower shall pay to the Agent
for the account of the Lenders a late charge equal to three percent (3%) of any
amount of principal and/or interest and/or charges on the Loans which is not
paid within ten (10) days of the date when due.
(S)4.10. Inability to Determine Eurodollar Rate. In the event, prior to
the commencement of any Interest Period relating to any Eurodollar Rate Loan,
the Agent shall determine that adequate and reasonable methods do not exist for
ascertaining the Eurodollar Rate that would otherwise determine the rate of
interest to be applicable to any Eurodollar Rate Loan during any Interest
Period, the Agent shall forthwith give notice of such determination (which shall
be conclusive and binding on the Borrower) to the Borrower. In such event (a)
any Loan Request with respect to Eurodollar Rate Loans shall be automatically
withdrawn and shall be deemed a request for Base Rate Loans, (b) each Eurodollar
Rate Loan will automatically, on the last day of the then current Interest
Period thereof, become a Base Rate Loan, and (c) the obligations of the Lenders
to make Eurodollar Rate Loans shall be suspended until the Agent determines that
the circumstances giving rise to such suspension no longer exist, whereupon the
Agent shall so notify the Borrower.
(S)4.11. Illegality. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Rate Loans, such Lender shall forthwith give notice of such
circumstances to the Borrower and thereupon (a) the Commitment of such Lender to
make Eurodollar Rate Loans or convert Loans of another Type to Eurodollar Rate
Loans shall forthwith be suspended and (b) the Eurodollar Rate Loans then
outstanding shall be converted automatically to Base Rate Loans on the last day
of each Interest Period applicable to such Eurodollar Rate Loans or within such
earlier period as may be required by law. The Borrower hereby agrees promptly to
pay to the Agent for the account of such Lender, upon demand, any additional
amounts necessary to compensate such Lender for any reasonable costs incurred by
such Lender in making any conversion in accordance with this (S)4.11, including
any interest or fees payable by such Lender to lenders of funds obtained by it
in order to make or maintain its Eurodollar Rate Loans hereunder.
(S)4.12. Replacement of Lenders. If any of the Lenders shall make a
notice or demand
upon the Borrower pursuant to (S)4.5, (S)4.6, or (S)4.11 based on circumstances
or laws which are not generally applicable to the Lenders organized under the
laws of the United States or any State thereof, the Borrower shall have the
right to replace such Lender with an Eligible Assignee selected by the Borrower
and approved by the Agent. In such event the assignment shall take place on a
date set by the Agent at which time the assigning Lender and the Eligible
Assignee shall enter into an Assignment and Acceptance as contemplated by
(S)18.1 (and clause (d) thereof shall not be applicable) and the assigning
Lender shall receive from the Eligible Assignee or the Borrower a sum equal to
the outstanding principal amount of the Loans owed to the assigning Lender
together with accrued interest thereon plus the accrued commitment fee under
(S)4.2 allocated to the assigning Lender plus an amount equal to the Fixed Rate
Prepayment Fee, if any, which would be due if the assigning Lender's Loans were
prepaid on such assignment date.
(S)4.13. U.S. Tax Certificates. Each Lender that is organized under the
laws of any jurisdiction other than the United States of America or any state or
other political subdivision thereof shall deliver to the Agent for transmission
to the Borrower, on the date it becomes a Lender, and at such other times as may
be necessary in the determination of the Borrower or the Agent (each in the
reasonable exercise of its discretion), to the extent permitted by law, such
certificates, documents or other evidence, properly completed and duly executed
by such Lender (including Internal Revenue Service Form 1001 or Form 4224 or any
other certificate or statement of exemption required by Treasury Regulations
Section 1.1441-4(a) or Section 1.1441-6(c) or any successor thereto) to
establish that such Lender is not subject to deduction or withholding of United
States federal income tax under Section 1441 or 1442 of the Internal Revenue
Code or otherwise (or under any comparable provisions of any successor statute)
with respect to any payments to such Lender of principal, interest, fees or
other amounts payable under any of the Loan Documents.
(S)5. COLLATERAL SECURITY; NO LIMITATION ON RECOURSE.
(S)5.1. Collateral Security. The Obligations shall be secured by (i) a
perfected first priority lien and security interest to be held by the Agent
(subject only to Permitted Liens) in the Mortgaged Properties, pursuant to the
terms of the Security Documents, (ii) a perfected first priority lien and
security interest to be held by the Agent in the Leases and rents pursuant to
the Assignments of Leases and Rents, (iii) a first priority pledge of any
pledged bonds purchased with the proceeds of Drawings under any IRB Letter of
Credit pursuant to the Pledge Agreements, and (iv) the Guaranties.
(S)5.2. No Limitation on Recourse. Notwithstanding the foregoing
Collateral, the Obligations are full recourse obligations of the Borrower (with
recourse to its partners limited to the extent provided in (S)28) and, to the
extent provided in the applicable Guaranty, of the Guarantors, and all of their
respective Real Estate Assets and other properties shall be available for the
indefeasible payment in full in cash and performance of the Obligations.
(S)5.3. Additional Properties.
(a) A Real Estate Asset owned by the Borrower or by a Guarantor may
become
an additional Mortgaged Property if (i) the Requisite Lenders, in their sole
discretion, approve such Real Estate as being eligible to become a Mortgaged
Property and (ii) all of the conditions set forth in (S)5.4 are satisfied with
respect to such Real Estate Asset. Borrower shall provide the Agent with a
notice of each proposed Additional Property describing such property, its
estimated value and its estimated net operating income together with a current
rent roll and the most current operating statements available with respect
thereto, which operating statements, to the extent available, shall cover a
period of at least two years. If the Agent determines that additional
information is needed to sufficiently describe such property, it may request a
supplemental notice from the Borrower containing such additional information.
When such notice is satisfactory to the Agent, it shall send a copy to each
Lender and any Lender which fails to notify the Agent of its objection within
five (5) Business Days after its receipt of such notice shall be deemed to have
granted its approval of the eligibility of such Real Estate Asset to become an
Additional Property. The fact that any Lender has approved or is deemed to have
so approved the eligibility of a Real Estate Asset shall not prevent such Lender
from withholding any consent, approval or waiver required or requested of such
Lender in connection with the satisfaction or waiver of the conditions set forth
in (S)5.4 with respect to such Real Estate Asset. In the event that the
Requisite Lenders grant such approval and all of the conditions set forth in
(S)5.4 are satisfied, the Agent shall notify the Borrower and within ten (10)
days thereafter the Borrower and the Company shall execute and deliver an
Indemnity Agreement and the Mortgagor shall execute and deliver to the Agent a
Security Deed, an Assignment of Rents and Leases and UCC-1 financing statements,
which Security Documents shall be in substantially the form of the Security
Documents executed and delivered herewith with such changes as the Agent may
deem desirable to address the laws of the State where the Additional Property is
located or the factual circumstances of the Additional Property. Such Additional
Properties shall be deemed to be Mortgaged Properties upon the recording and
filing of such Security Documents and the Agent's receipt of satisfactory
evidence thereof.
(b) After the Continental Towers Property has been released as an
Assigned Mortgaged Property pursuant to (S)5.5, another Real Estate Asset may
become an Assigned Mortgaged Property if (i) all Lenders, in their sole
discretion, approve such Real Estate Asset as being eligible to become an
Assigned Mortgaged Property, (ii) the Requisite Lenders, in their sole
discretion, approve the terms and conditions of the proposed Assigned Note and
related documents and (iii) all conditions set forth in (S)5.4 are satisfied
with respect to such Real Estate Asset. If the Requisite Lenders grant such
approvals, then upon satisfaction of the conditions set forth in (S)5.4 and
execution and delivery of the Assigned Note Assignment, the original of the
Assigned Note endorsed to the Agent and all other documents required by the
Agent in connection therewith, the Agent shall revise Schedule 1.1 to include
such Additional Property as an Assigned Mortgaged Property. At any time there
shall be no more than one Assigned Mortgaged Property hereunder.
(c) The Agent and the Lenders shall use their best efforts to
complete their review of the documents submitted with respect to each Additional
Property within ten (10) Business Days after receipt of the last of the items
required pursuant to (S)5.4. With respect to the items which require approval of
the Requisite Lenders (Appraisal, Environmental Report and Inspecting Engineers'
Report) each Lender shall notify the Agent of its approval or disapproval
within such ten (10) Business Day period.
(S)5.4. Conditions to Approval of Additional Properties. Prior to
acceptance of any Real Estate Asset to become an Additional Property pursuant to
(S)5.3, such property must satisfy the following conditions, which may be
modified or waived only by the written agreement of the Requisite Lenders:
(a) If the Additional Property is not owned by the Borrower or an
existing Guarantor Subsidiary, but is owned by a Related Company which is at
least 99% owned by Borrower, such Related Company must become a Guarantor
Subsidiary by delivery to the Agent of the following, all in form and substance
satisfactory to the Agent: (i) a Guaranty in substantially the form of the
Guaranty executed and delivered by the Guarantor Subsidiaries prior to the
Effective Date and (ii) good standing certificates, general partner
certificates, secretary certificates, opinions of counsel and such other
documents as may be reasonably requested by the Agent.
(b) An Appraisal of the Additional Property ordered by the Agent and
paid for by the Borrower shall have been approved by the Requisite Lenders.
(c) The Agent shall have received all of the items relating to the
Additional Property described in (S)10.8, (S)10.9, (S)10.10, (S)10.12, (S)10.13,
(S)10.16 and (S)10.18 and such items shall have been approved by the Agent or
the Requisite Lenders as required by such Sections.
(d) The Agent shall have received a Certificate executed on behalf of
the Borrower and, if applicable, the Guarantor Subsidiary which is the owner of
the Additional Property, containing the representations and warranties with
respect to the Additional Property as are set forth in (S)6, to which there
shall be attached a current rent roll for the Additional Property which shall be
deemed to supplement and become a part of Schedule 6.22(l) hereto.
(e) The Borrower shall have requested estoppel certificates in form
reasonably satisfactory to the Agent from the tenants under all Leases of the
Additional Property, shall have used its best efforts to obtain all such
estoppel certificates and shall have received such estoppel certificates as the
Lead Lenders may, in their discretion, require, and all estoppel certificates
received shall be satisfactory to the Lead Lenders.
(f) The Agent shall have received updated certificates and other
items relating to the Borrower, the Company and the applicable Guarantor
Subsidiary as described in (S)10.2, (S)10.3 and (S)10.4 and a favorable opinion
addressed to the Lenders and the Agent, in form and substance satisfactory to
the Lenders and the Agent as to the matters described on Exhibit E relating to
the Loan Documents executed by Borrower and/or the Mortgagor with respect to the
Additional Property and relating to the laws of the state where the Additional
Property is located.
(S)5.5. Release of Mortgaged Properties. The Borrower may request that
the Agent release any Mortgaged Property from the lien of the Security Documents
and the Agent shall
grant such requested release provided that (i) the requested release is
consented to by the Requisite Lenders (such consent having been granted for the
release of the Continental Towers Property) and (ii) there is then no continuing
Default or Event of Default under this Agreement and the requested release will
not result in any Default or Event of Default under this Agreement and the
Borrower delivers to the Agent a pro-forma Compliance Certificate reasonably
satisfactory to the Agent demonstrating that the requested release will not
result in a violation of any of the covenants in (S)9. Each Lender agrees to
respond to any such request for Requisite Lender consent within five (5)
Business Days and agrees to not unreasonably withhold its consent. The Borrower
may request releases of a portion of a Mortgaged Property consisting of
undeveloped land to be developed by Borrower or sold provided that in addition
to the requirements set forth above, the Borrower shall also submit such
additional information as may be reasonably requested by the Agent including,
without limitation, (i) an updated survey and endorsements to the Title Policy;
(ii) an updated Appraisal of the remaining portion of the Mortgaged Property and
(iii) evidence that the division of the Mortgaged Property pursuant to the
requested release will not result in violation of any zoning ordinance or other
applicable laws and ordinances. If the Borrower shall request the release of any
Mortgaged Property which is adjacent to any other Mortgaged Property which is
not to be simultaneously released, the Agent may require the establishment of
appropriate easements and maintenance agreements satisfactory to the Agent
relating to any shared utilities, drainage facilities, access drives or walks,
parking areas or other shared facilities and evidence satisfactory to the Agent
that the property to be released is assessed as a separate tax parcel from the
Mortgaged Property which is not to be released.
(S)6. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants to the Agent and each of the Lenders as follows, and to the extent that
the following representations and warranties relate to the Company, the Company
represents and warrants to the Agent and each of the Lenders as follows:
(S)6.1. Authority; Etc.
(a) Organization; Good Standing. The Company (i) is a Maryland real
estate investment trust duly organized, validly existing and in good standing
under the laws of the State of Maryland, (ii) has all requisite power to own its
properties and conduct its business as now conducted and as presently
contemplated, and (iii) to the extent required by law is in good standing as a
foreign entity and is duly authorized to do business in the States in which the
Mortgaged Properties are located and in each other jurisdiction where such
qualification is necessary except where a failure to be so qualified in such
other jurisdiction would not have a Materially Adverse Effect. The Borrower is a
Delaware limited partnership, and each Guarantor Subsidiary is a limited
partnership or a limited liability company formed under the laws of Illinois,
Tennessee or Delaware, and each such entity is duly organized, validly existing
and in good standing under the laws of the State of its formation, has all
requisite power to own its properties and conduct its business as presently
contemplated and is duly authorized to do business in the States in which the
Mortgaged Properties owned by it are located and in each other jurisdiction
where such qualification is necessary.
(b) Authorization. The execution, delivery and performance of this
Agreement and the other Loan Documents to which the Borrower is to become a
party and the transactions contemplated hereby and thereby (i) are within the
authority of the Borrower, (ii) have been duly authorized by all necessary
proceedings on the part of the Borrower and the Company, (iii) do not conflict
with or result in any breach or contravention of any provision of law, statute,
rule or regulation to which the Borrower or the Company is subject or any
judgment, order, writ, injunction, license or permit applicable to the Borrower
or the Company and (iv) do not conflict with any provision of the Borrower's
partnership agreement or Company's declaration of trust, charter documents or
bylaws, or any material agreement or other material instrument binding upon, the
Borrower or the Company or to which any of their properties are subject. The
execution, delivery and performance of the Guaranty and the other Loan Documents
to which any Guarantor is to become a party and the transactions contemplated
hereby and thereby (i) are within the authority of such Guarantor, (ii) have
been duly authorized by all necessary proceedings on the part of such Guarantor,
(iii) do not conflict with or result in any breach or contravention of any
provision of law, statute, rule or regulation to which such Guarantor is subject
or any judgment, order, writ, injunction, license or permit applicable to such
Guarantor and (iv) do not conflict with any provision of such Guarantor's
charter documents or bylaws, partnership agreement, limited liability company
agreement, declaration of trust, or any agreement or other instrument binding
upon such Guarantor or to which any of such Guarantor's properties are subject.
(c) Enforceability. The execution and delivery of this Agreement and
the other Loan Documents to which the Borrower is or is to become a party will
result in valid and legally binding obligations of the Borrower enforceable
against it in accordance with the respective terms and provisions hereof and
thereof, except as enforceability is limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting generally the
enforcement of creditors' rights and except to the extent that availability of
the remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding therefor may be brought. The
execution and delivery of this Agreement and the Indemnity Agreement will result
in valid and legally binding obligations of the Company enforceable against it
in accordance with the respective terms and provisions hereof and thereof,
except as enforceability is limited by bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or affecting generally the enforcement of
creditors' rights and except to the extent that availability of the remedy of
specific performance or injunctive relief is subject to the discretion of the
court before which any proceeding therefor may be brought. The execution and
delivery of the Guaranty and the other Loan Documents to which any Guarantor is
or is to become a party will result in valid and legally binding obligations of
such Guarantor enforceable against such Guarantor in accordance with the
respective terms and provisions hereof and thereof, except as enforceability is
limited by bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or affecting generally the enforcement of creditors' rights and
except to the extent that availability of the remedy of specific performance or
injunctive relief is subject to the discretion of the court before which any
proceeding therefor may be brought.
(S)6.2. Governmental Approvals. The execution, delivery and performance
by the
Borrower, the Company and each Guarantor of this Agreement and the other
Loan Documents to which the Borrower or such Guarantor is or is to become a
party and the transactions contemplated hereby and thereby do not require the
approval or consent of, or filing with, any governmental agency or authority
other than those already obtained and the filing of the Security Documents in
the appropriate records office with respect thereto.
(S)6.3. Title to Properties.
(a) The Borrower or one of the Guarantor Subsidiaries holds good
and clear record and marketable fee simple title to the Mortgaged Properties,
subject to no Liens or encumbrances except for the Permitted Liens.
(b) Except as indicated on Schedule 6.3 hereto, the Borrower or
the Related Companies own all of the properties reflected in the Closing Balance
Sheet of the Company, subject to no Liens except Permitted Liens.
(S)6.4. Financial Statements. The following financial statements have
been furnished to each of the Lenders.
(a) The Prospectus Financial Statements. The Prospectus Financial
Statements have been prepared in accordance with Generally Accepted Accounting
Principles and fairly present the financial condition of the Borrower and the
Company as at the close of business on the Facility Closing Date and the results
of operations for the applicable period. There are no direct or contingent
liabilities of the Borrower or the Company as of such date involving material
amounts, known to the officers of the Company not disclosed in the Closing
Balance Sheet of the Company contained in the Prospectus Financial Statements
and the related notes thereto. There are no material differences between the
Closing Balance Sheet and balance sheet of the Borrower and its subsidiaries
prepared on a consolidated basis in accordance with Generally Accepted
Accounting Principles prepared on the same basis and as of the same date as the
Closing Balance Sheet, other than the line item for the minority interests in
the Borrower.
(b) With respect to each Mortgaged Property, a statement prepared
by the Borrower of the rental and other income of the Borrower from the
operation of such Mortgaged Property for each of the previous four (4) fiscal
quarters, and all operating and other costs and expenses incurred by the
Borrower in connection with such Mortgaged Property during such fiscal quarters,
certified by a Responsible Officer of the Company as fairly presenting the
results of operation with respect to such Mortgaged Property for such fiscal
period.
(S)6.5. No Material Changes, Etc. The Formation Transactions and all other
events which are the basis for the assumptions used in preparation of the
Closing Balance Sheet have happened. Since the time of preparation of the
Closing Balance Sheet, there has occurred no material adverse change in the
financial condition or assets or business of the Borrower as shown on or
reflected on the Closing Balance Sheet, nor has there been any material increase
in the liabilities of the Borrower or the Company in excess of those shown
thereon other than changes in the ordinary course of business that have not had
any Material Adverse Effect either
individually or in the aggregate.
(S)6.6. Franchises, Patents, Copyrights, Etc. The Borrower possesses all
franchises, patents, copyrights, trademarks, trade names, licenses and permits,
and rights in respect of the foregoing, adequate for the conduct of its business
substantially as now conducted without known conflict with any rights of others,
including all Permits except to the extent the Borrower's failure to possess the
same does not have a Material Adverse Effect.
(S)6.7. Litigation. Except as listed and described on Schedule 6.7 hereto,
there are no actions, suits, proceedings or investigations of any kind pending
or, to Borrower's knowledge, threatened against the Borrower, the Company, any
Guarantor or any of the Related Companies before any court, tribunal or
administrative agency or board that, if adversely determined, are reasonably
expected to, either in any case or in the aggregate, have a Material Adverse
Effect or materially impair the right of the Borrower, the Company, any
Guarantor or any of the Related Companies to carry on business substantially as
now conducted by it, or which question the validity of this Agreement or any of
the other Loan Documents, any action taken or to be taken pursuant hereto or
thereto, or any Lien or security interest created or intended to be created
pursuant hereto or thereto, or which will materially adversely affect the
ability of the Borrower or any Guarantor to pay and perform the Obligations in
the manner contemplated by this Agreement and the other Loan Documents.
(S)6.8. No Materially Adverse Contracts, Etc. The Borrower is not subject
to any charter, trust or other legal restriction, or any judgment, decree,
order, rule or regulation that has or is expected in the future, in the judgment
of the Company's officers, to have a Material Adverse Effect. The Borrower is
not a party to any contract or agreement that has or is expected, in the
judgment of the Company's officers, to have any Material Adverse Effect. The
Company is not subject to any charter, trust or other legal restriction, or any
judgment, decree, order, rule or regulation that has or is expected in the
future, in the judgment of the Company's officers, to have a Material Adverse
Effect. The Company is not a party to any contract or agreement that has or is
expected, in the judgment of the Company's officers, to have any Material
Adverse Effect. None of the Guarantors is subject to any charter, trust or other
legal restriction, or any judgment, decree, order, rule or regulation that has
or is expected in the future, in the judgment of the Company's officers, to have
a Material Adverse Effect. None of the Guarantors is a party to any contract or
agreement that has or is expected, in the judgment of the Company's officers, to
have any Material Adverse Effect.
(S)6.9. Compliance With Other Instruments, Laws, Etc. Neither the Borrower
nor the Company is in violation of any provision of the Borrower's partnership
agreement, the partnership agreement of any of the Guarantor Subsidiaries or of
the Company's declaration of trust, by-laws, or any agreement or instrument to
which it may be subject or by which the Borrower, any of the Guarantors or any
of their respective properties may be bound or any decree, order, judgment,
statute, license, rule or regulation, in any of the foregoing cases in a manner
that could result in the imposition of substantial penalties or have a Material
Adverse Effect.
(S)6.10. Tax Status. Each of the Borrower, the Company and the Guarantor
Subsidiaries (a) has made or filed all federal and state income and all other
tax returns, reports and declarations required by any jurisdiction to which it
is subject, and (b) has paid all taxes and other governmental assessments and
charges shown or determined to be due on such returns, reports and declarations,
except those being contested in good faith and by appropriate proceedings. There
are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Company know of no basis
for any such claim.
(S)6.11. Event of Default. No Default or Event of Default has occurred and
is continuing.
(S)6.12. Investment Company Act. The Borrower is not an "investment
company", or an "affiliated company" or a "principal underwriter" of an
"investment company", as such terms are defined in the Investment Company Act of
1940.The Company is not an "investment company", or an "affiliated company" or a
"principal underwriter" of an "investment company", as such terms are defined in
the Investment Company Act of 1940. None of the Guarantors is an "investment
company", or an "affiliated company" or a "principal underwriter" of an
"investment company", as such terms are defined in the Investment Company Act of
1940.
(S)6.13. Absence of Financing Statements, Etc. There is no financing
statement, security agreement, chattel mortgage, real estate mortgage, equipment
lease, financing lease, option, encumbrance or other document existing, filed or
recorded with any filing records, registry, or other public office, that
purports to cover, affect or give notice of any present or possible future Lien
or encumbrance on, or security interest in, any Collateral, except those in
favor of the Agent or Permitted Liens.
(S)6.14. Setoff, Etc. The Collateral and the Agent's rights with respect to
the Collateral are not subject to any setoff, claims, withholdings or other
defenses. Either the Borrower or a Guarantor is the owner of the Collateral free
from any lien, security interest, encumbrance and any other claim or demand,
except for the Permitted Liens.
(S)6.15. Certain Transactions. Except as disclosed in the Equity
Prospectus, none of the officers or employees of the Borrower, the Company or
any Guarantor are presently a party to any transaction with the Borrower, the
Company or any Guarantor (other than for services as employees, officers and
trustees) , including any contract, agreement or other arrangement providing for
the furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
trustee or such employee or, to the knowledge of the Borrower and the Company,
any corporation, partnership, trust or other entity in which any officer,
trustee or any such employee or natural Person related to such officer, trustee
or employee (or other Person in which such officer, trustee or employee has a
direct or indirect beneficial interest) has a substantial interest or is an
officer or trustee.
(S)6.16. Benefit Plans: Multiemployer Plans: Guaranteed Pension Plans. As
of the date hereof, neither the Borrower nor any ERISA Affiliate maintains or
contributes to any Employee Benefit Plan, Multiemployer Plan or Guaranteed
Pension Plan. To the extent that Borrower, the
Company or any ERISA Affiliate hereafter maintains or contributes to any
Employee Benefit Plan or Guaranteed Pension Plan, it shall at all times do so in
compliance with (S)7.18 hereof.
(S)6.17. Regulations U and X. No portion of any Loan is to be used for the
purpose of purchasing or carrying any "margin security" or "margin stock" as
such terms are used in Regulations U and X of the Board of Governors of the
Federal Reserve System, 12 C.F.R. Parts 221 and 224.
(S)6.18. Environmental Compliance. The Borrower has delivered to the Agent
the Environmental Reports with respect to the Mortgaged Properties which are
listed on Schedule 6.18. Except as may be set forth in the Environmental Reports
with respect to the Mortgaged Properties, or as described on Schedule 6.18 or in
the Equity Prospectus with respect to the other Real Estate Assets, Borrower
makes the following representations and warranties:
(a) To the best of Borrower's knowledge, none of the Borrower,
any Guarantor, any of the Related Companies or any operator of the Real Estate
or any portion thereof, or any operations thereon is in violation, or alleged
material violation, of any judgment, decree, order, law, license, rule or
regulation pertaining to environmental matters, including without limitation,
those arising under the Resource Conservation and Recovery Act ("RCRA"), the
Comprehensive Environmental Response, Compensation and Liability Act of 1980 as
amended ("CERCLA"), the Superfund Amendments and Reauthorization Act of 1986
("XXXX"), the Federal Clean Water Act, the Federal Clean Air Act, the Toxic
Substances Control Act, or any state or local statute, regulation, ordinance,
order or decree relating to health, safety or the environment, including,
without limitation, the environmental statutes, regulations, orders and decrees
of the States in which any of the Real Estate may be located (hereinafter
collectively referred to as the "Environmental Laws"), which violation either
involves the Mortgaged Properties or would have a Material Adverse Effect.
(b) None of the Borrower, Prime, the Guarantors or the Related
Companies has received written notice from any third party including, without
limitation any federal, state or local governmental authority with respect to
any of the Mortgaged Properties, or with respect to any other Real Estate if the
same would have a Material Adverse Effect, (i) that it has been identified by
the United States Environmental Protection Agency ("EPA") as a potentially
responsible party under CERCLA with respect to a site listed on the National
Priorities List, 40 C.F.R. Part 000 Xxxxxxxx X (1986) ; (ii) that any hazardous
waste, as defined by 42 U.S.C. (S)9601(5), any hazardous substances as defined
by 42 U.S.C. (S)9601(14), any pollutant or contaminant as defined by 42 U.S.C.
(S)9601(33) or any toxic substances, oil or hazardous materials or other
chemicals or substances regulated by any Environmental Laws ("Hazardous
Materials") which it has generated, transported or disposed of have been found
at any site at which a federal, state or local agency or other third party has
conducted or has ordered that the Borrower, any Guarantor or any of the Related
Companies conduct a remedial investigation, removal or other response action
pursuant to any Environmental Law; or (iii) that it is or shall be a named party
to any claim, action, cause of action, complaint, or legal or administrative
proceeding (in each case, contingent or otherwise) arising out of any third
party's incurrence of costs, expenses, losses or damages of any kind whatsoever
in connection with the release of Hazardous Materials.
(c) (i) To the best of Borrower's knowledge no portion of the
Real Estate has been used for the handling, processing, storage or disposal of
Hazardous Materials except in material compliance with applicable Environmental
Laws; and no underground tank or other underground storage receptacle for
Hazardous Materials is located on any portion of the Real Estate except in
material compliance with applicable Environmental Laws; (ii) to the best of
Borrower's knowledge, in the course of any activities conducted by the Borrower,
any Guarantor, any of the Related Companies, the operators of any Real Estate or
any ground or space tenants on any Real Estate, no Hazardous Materials have been
generated or are being used on the Real Estate except in material compliance
with applicable Environmental Laws, which in the case of Real Estate other than
the Mortgaged Properties would have a Material Adverse Effect; (iii) there has
been no present, or to the best of Borrower's knowledge past, releasing,
spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, disposing or dumping (a "Release") or threatened Release of Hazardous
Materials on, upon, into or from the Mortgaged Properties or the other Real
Estate, which Release in the case of Real Estate other than the Mortgaged
Properties would have a Material Adverse Effect and; (iv) to the best of
Borrower's knowledge, there have been no Releases on, upon, from or into any
real property in the vicinity of any of the Real Estate which, through soil or
groundwater contamination, may have come to be located on, and which would have
a Material Adverse Effect; and (v) notwithstanding that any representation
contained herein may be limited to the knowledge of the Borrower, any such
limitation shall not affect the covenants specified in (S)7.10 or elsewhere in
this Agreement.
(S)6.19. Subsidiaries and Affiliates. The Borrower has no Subsidiaries
except for the Related Companies listed on Schedule 1.3 and does not have an
ownership interest in any entity whose financial statements are not consolidated
with the Borrower's except for the Permitted Joint Ventures listed on Schedule
1.3. The Company is not a partner in any partnership other than Borrower and
certain of the Related Companies listed on Schedule 1.3 which are limited
partnerships in which the Company has a one tenth percent (0.1%) limited
partnership interest, has no Investments in any Person other than the Borrower
and such limited partnerships and is not a member of any limited liability
company. The Company owns no material assets other than its partnership interest
in Borrower and the limited partnership interests described in this (S)6.19.
(S)6.20. Major Leases. The Borrower has delivered to the Agent complete
copies of the Major Leases and of the other Leases requested by the Agent.
(S)6.21. Loan Documents. All of the representations and warranties of the
Borrower or any Guarantor made in the other Loan Documents or any document or
instrument delivered or to be delivered to the Agent or the Lenders pursuant to
or in connection with any of such Loan Documents are true and correct in all
material respects.
(S)6.22. Mortgaged Properties. In this (S)6.22 the phrase "to the
Borrower's knowledge" shall mean the actual knowledge of the officers and
employees of the Borrower, the Company or of Prime who have had significant
responsibility for the operation, management and leasing of the applicable
Mortgaged Property. Notwithstanding that any representation contained herein
may be limited to the Borrower's knowledge, any such limitation shall not affect
any covenant with respect to the same or similar subject matter contained in
(S)7 or elsewhere in this Agreement or in the Loan Documents. The Borrower makes
the following additional representations and warranties concerning the Mortgaged
Properties:
(a) Off-Site Utilities. All water, sewer, electric, gas,
telephone and other utilities are installed to the property lines of the
Mortgaged Properties and, except in the case of drainage facilities, are
connected to the Buildings located thereon and to the Borrower's knowledge are
adequate to service the Buildings in full compliance with applicable law; and to
the Borrower's knowledge the Buildings are properly and legally connected
directly to public water and sewer systems. No easements over land of others not
yet obtained are required for any such utilities, and no drainage of surface or
other water across land of others is required except as disclosed in the
Surveys.
(b) Surveys, Access; Etc. Since the date of the most recent
Survey delivered to the Agent with respect to each Mortgaged Property, there has
been no construction (except interior renovations and improvements) of
additional Buildings or additions to Buildings on such Mortgaged Property, and
to the Borrower's knowledge no takings by eminent domain affecting such
Mortgaged Property or other changes which may have caused such Survey to be no
longer accurate.
(c) Independent Building. The Buildings on each Mortgaged
Property (except as described in documents referred in the Title Policy for the
West Xxxxxx Drive Property with respect to walkways and other common areas
shared by such property with other buildings) are fully independent from any
other real estate in all respects including, without limitation, in respect of
structural integrity, heating, ventilating and air conditioning, plumbing,
mechanical and other operating and mechanical systems, and electrical,
sanitation and water systems, all of which are connected directly to off-site
utilities located in public streets or ways. Each Mortgaged Property consists of
one or more lots which are not assessed for purposes of real estate tax
assessment and payment jointly with any land which is not a part of such
Mortgaged Property. The Buildings, all Building Service Equipment and all paved
or landscaped areas related to or used in connection with the Buildings are
located wholly within the perimeter lines of the lot or lots on which the
Mortgaged Properties are located except as disclosed in the Surveys.
(d) Condition of Building; No Asbestos. Except as set forth in
the Inspecting Engineers' Reports, to the Borrower's knowledge there are no
material defects in the roof, foundation, structural elements and masonry walls
of the Buildings or their heating, ventilating and air conditioning, electrical,
sprinkler, plumbing or other mechanical systems or their Building Service
Equipment; the Buildings are fully sprinkled; and no friable asbestos is located
in or on the Buildings except as may be disclosed in the Environmental Reports.
(e) Building Compliance with Law; Permits. The Buildings as
presently constructed and used do not, to the Borrower's knowledge, violate any
applicable federal or state law or governmental regulation, or any local
ordinance, order or regulation, including but not
limited to laws, regulations, or ordinances relating to zoning, building use and
occupancy, subdivision control, fire protection, health and sanitation. To the
Borrower's knowledge, all Permits required for the operation and maintenance of
the Mortgaged Properties, including without limitation, building permits, curb-
cut permits, water connection permits, sewer extension or connection permits and
other permits relating to the use of utilities, and permits required under the
Federal Clean Air Act, as amended, the Federal Clean Water Act, as amended
(including, without limitation a so-called Section 404 Permit"), and by state
law or regulations consistent with the requirements of said Acts, have been
validly issued by the appropriate governmental Persons and are now in full force
and effect.
(f) No Required Real Property Consents, Permits, Etc. The
Borrower has received no notices of, nor has any knowledge of, any Permits,
utility installations and connections (including, without limitation, drainage
facilities, curb cuts and street openings), or private consents required for the
maintenance, operation, servicing and use of the Mortgaged Properties for their
current use which have not been granted, effected, or performed and completed
(as the case may be) or any fees or charges therefor which have not been fully
paid provided, however, that certain Permits may require periodic renewals.
(g) Suits; Judgments. To the Borrower's knowledge, there are no
outstanding notices, suits, orders, decrees or judgments relating to zoning,
building use and occupancy, subdivision control, fire protection, health,
sanitation, or other violations affecting, against, or with respect to, the
Mortgaged Properties or any part thereof, other than suits, orders, decrees or
judgments against tenants or former tenants with respect to defaults by such
tenants under their Leases or evicting or otherwise obtaining possession of the
premises occupied by such tenants.
(h) Insurance. None of the Guarantors, the Company or the
Borrower has received any written notices from any insurer or its agent
requiring performance of any material work with respect to the Mortgaged
Properties or canceling or threatening to cancel any policy of insurance.
(i) Real Property Taxes; Special Assessments. Based on the Title
Policies, there are no unpaid or outstanding real estate or other taxes or
assessments on or against the Mortgaged Properties or any part thereof which are
payable by Borrower or tenants (except only real estate taxes and assessments
not yet due and payable). Except as disclosed on the Title Policies, and to the
Borrower's knowledge there are no betterment assessments or other special
assessments presently pending with respect to any portion of the Mortgaged
Properties, and Borrower has received no notice of any such special assessment
being contemplated.
(j) Historic Status. To the Borrower's knowledge, the Buildings
are not historic structures or landmarks, and the Mortgaged Properties are not
within any historic district pursuant to any federal, state or local law or
governmental regulation.
(k) Domain. To the Borrower's knowledge, there are no pending
eminent domain proceedings against the Mortgaged Properties or any part thereof,
and no such proceedings are presently threatened or contemplated by any taking
authority.
(l) Leases. A rent roll with respect to all Leases of any
portion of the Mortgaged Properties (current as of the date set forth thereon)
is accurate and completely set forth in Schedule 6.22(1) as the same shall be
supplemented each fiscal quarter by a certificate signed by an authorized
officer of Borrower. The Leases reflected on such rent roll constitute the sole
and complete agreements and understandings relating to leasing or licensing of
space in the Buildings or otherwise at the Mortgaged Properties. The Borrower
has delivered to the Agent a true and complete copy of all Major Leases. There
are no occupancies, rights, privileges or licenses in or to the Buildings or any
other part of the Mortgaged Properties other than pursuant to the Leases
reflected on the rent roll set forth in Schedule 6.22(1). Except as set forth
in Schedule 6.22(1) the Leases reflected on the Schedule 6.22(1) rent roll are
in full force and effect, in accordance with their respective terms, without any
payment default or any other material default thereunder, nor to the Borrower's
knowledge, are there any defenses, counterclaims, offsets, concessions or
rebates available to any tenant thereunder, and the Mortgagor has not given or
made, or received, any notice of default, or any material claim, which remains
uncured or unsatisfied, with respect to any of the Major Leases and, to the best
of the Borrower's knowledge there is no basis for any such claim or notice of
default by any tenant. The Schedule 6.22(1) rent roll accurately and completely
sets forth all rents payable by tenants, no tenant having paid more than one
month's rent in advance. All tenant improvements or work to be done, furnished
or paid for by the landlord, or credited or allowed to a tenant, for, or in
connection with, the Buildings pursuant to any Lease has been completed and paid
for, or provided for in a manner satisfactory to the Agent, or will be paid for
by the Borrower in the ordinary course of the Borrower's business. No leasing,
brokerage or like commissions, fees or payments are due from the Borrower in
respect of the Leases, or will be paid for by the Borrower in the ordinary
course of the Borrower's business. Except as set forth on the Schedule 6.22(1)
rent roll, all tenants under all Leases are in occupancy and operating the
premises covered by such Leases within the permitted uses under such Leases.
(m) Service Agreements. Except as listed on Schedule 6.22 (m),
there are no Service Agreements relating to the operation and maintenance of the
Mortgaged Properties or any part thereof except Service Agreements which may be
terminated at the owner's option upon not more than 60 days advance notice. To
the best of Borrower's knowledge, no default notices have been given by any
party to any Service Agreement.
(n) Other Material Real Property Agreements; No Options. Except
as listed on Schedule 6.22(n), there are no material agreements pertaining to
the Mortgaged Properties or the operation or maintenance thereof other than as
described in this Agreement (including the Schedules hereto) or otherwise
disclosed in writing to the Agent by the Borrower, and no person or entity has
any right or option to acquire any of the Mortgaged Properties or any portion
thereof or interest therein or lease any portion thereof or additional portion
thereof or provide services thereat.
(S)7. AFFIRMATIVE COVENANTS OF THE BORROWER. The Borrower covenants and
agrees as follows, and to the extent that the following covenants relate to the
Company, the Company covenants and agrees as follows, so long as any Loan, Note
or Letter of Credit is outstanding or the Lenders have any obligations to make
Loans or issue Letters of
Credit:
(S)7.1. Punctual Payment. The Borrower will unconditionally duly and
punctually pay the principal and interest on the Loans and all other amounts
provided for in the Note, this Agreement, and the other Loan Documents all in
accordance with the terms of the Note, this Agreement and the other Loan
Documents.
(S)7.2. Maintenance of Office. Each of the Borrower and the Company will
maintain its chief executive office in Chicago, Illinois or at such other place
in the United States Of America as the Borrower or the Company shall designate
upon written notice to the Agent to be delivered within fifteen (15) days of
such change, where notices, presentations and demands to or upon the Borrower or
the Company in respect of the Loan Documents may be given or made.
(S)7.3. Records and Accounts. Each of the Borrower and the Company will
keep true and accurate records and books of account in which full, true and
correct entries will be made in accordance with Generally Accepted Accounting
Principles.
(S)7.4. Financial Statements, Certificates and Information. The Borrower
will deliver to each of the Lenders:
(a) as soon as practicable, but in any event not later than
ninety (90) days after the end of each fiscal year of the Borrower, the audited
balance sheet of the Borrower and of the Company at the end of such year, and
the related audited statement of income, statement of changes in shareholders,
equity and statement of Funds From Operations and taxable income for such year,
each setting forth in comparative form the figures for the previous fiscal year
and all such statements to be in reasonable detail, prepared in accordance with
Generally Accepted Accounting Principles on a consolidated basis including the
Borrower, the Company and the Related Companies, and accompanied by an auditor's
report prepared without qualification by Ernst & Young LLP or by another
independent certified public accountant reasonably acceptable to the Agent;
(b) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each fiscal quarter of the Borrower,
copies of the unaudited balance sheets of the Borrower as at the end of such
quarter, and the related unaudited statement of income, statement of changes in
shareholders' equity and statement of Funds From Operations and estimated
taxable income for the portion of the Borrower's fiscal year then elapsed, all
in reasonable detail and prepared in accordance with Generally Accepted
Accounting Principles, together with a certification by the principal financial
or accounting officer of the Company that the information contained in such
financial statements fairly presents the financial position of the Borrower and
of the Company on the date thereof (subject to year-end adjustments), provided,
however, that such information with respect to the quarter ended September 30,
1997 shall be delivered by December 29, 1997;
(c) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of the fiscal quarters of the
Borrower, copies of a statement of the
Net Operating Income for such fiscal quarter for each Mortgaged Property, and a
consolidating statement of the Net Operating Income for such fiscal quarter for
all of the Mortgaged Properties, prepared on a basis consistent with the
statements furnished pursuant to (S)6.4 (b) , and certified by a Responsible
Officer of the Company;
(d) as soon as practicable, but in any event no later than
forty-five (45) days after the end of each fiscal quarter of the Borrower, a
rent roll for each of the Mortgaged Properties, and a consolidated rent roll for
all of the Mortgaged Properties, each dated as of the end of such fiscal quarter
in form reasonably satisfactory to the Agent;
(e) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement in the form of Exhibit
C hereto signed by a Responsible Officer of the Company and setting forth in
reasonable detail computations evidencing compliance with the covenants
contained herein and (if applicable) reconciliations to reflect changes in
Generally Accepted Accounting Principles since the Facility Closing Date;
(f) as soon as practicable, but in any event not later than
ninety (90) days after the end of each fiscal year of the Company, copies of the
Form 10-K statement filed with the Securities and Exchange Commission ("SEC")
for such fiscal year, and as soon as practicable, but in any event not later
than forty-five (45) days after the end of each fiscal quarter, copies of the
Form 10-Q statement filed with the SEC for such fiscal quarter, provided that in
either case if the SEC has granted an extension for the filing of such
statements (or if a later filing is permitted by rule of the SEC with respect to
the fiscal quarter ended September 30. 1997), Borrower shall deliver such
statements to the Agent simultaneously with the filing thereof with the SEC;
(g) promptly following the filing or mailing thereof, copies of
all other material of a financial nature filed with the SEC or sent to the
shareholders of the Company or to the limited partners of the Borrower and
copies of all press releases (except local press releases relating to specific
properties) promptly upon the issuance thereof; and
(h) from time to time such other financial data and information
(including accountants' management letters) as the Agent or any Lender may
reasonably request.
(S)7.5. Notices. The Borrower will provide the following notices to the
Agent with sufficient copies for each Lender:
(a) Defaults. The Borrower will promptly notify the Agent in
writing of the occurrence of any Default or Event of Default. If any Person
shall give any notice or take any other action in respect of a claimed default
(whether or not constituting a Default or an Event of Default under this
Agreement) under any note, evidence of Indebtedness, indenture or other
obligation to which or with respect to which the Borrower, the Company, any
Guarantor or any of the Related Companies is a party or obligor, whether as
principal or surety, and if the principal amount thereof exceeds $1,000,000, and
such default would permit the holder of such note or obligation or other
evidence of Indebtedness to accelerate the maturity thereof, the Borrower shall
forthwith give written notice thereof to the Agent and each of the Lenders,
describing the notice or action and the nature of the claimed default.
(b) Environmental Events. The Borrower will promptly notify the
Agent in writing of any of the following events: (i) upon Borrower's obtaining
knowledge of any violation of any Environmental Law regarding a Mortgaged
Property or any Real Estate or Borrower's operations which violation could have
a Material Adverse Effect; (ii) upon Borrower's obtaining knowledge of any
potential or known Release, or threat of Release, of any Hazardous Materials at,
from, or into a Mortgaged Property or any Real Estate which it reports in
writing or is reportable by it in writing to any governmental authority and
which is material in amount or nature or which could materially affect the value
of such Mortgaged Property or which could have a Material Adverse Effect; (iii)
upon Borrower's receipt of any notice of violation of any Environmental Laws or
of any Release or threatened Release of Hazardous Materials, including a notice
or claim of liability or potential responsibility from any third party
(including without limitation any federal, state or local governmental
officials) and including notice of any formal inquiry, proceeding, demand,
investigation or other action with regard to (A) Borrower's or any Person's
operation of a Mortgaged Property or any Real Estate if the same would have a
Material Adverse Effect, (3) contamination on, from or into a Mortgaged Property
or any Real Estate if the same would have a Material Adverse Effect, or (C)
investigation or remediation of off-site locations at which Borrower or any of
its predecessors are alleged to have directly or indirectly disposed of
Hazardous Materials; or (iv) upon Borrower's obtaining knowledge that any
expense or loss has been incurred by such governmental authority in connection
with the assessment, containment, removal or remediation of any Hazardous
Materials with respect to which Borrower, Guarantor or any of the Related
Companies may be liable or for which a lien may be imposed on a Mortgaged
Property.
(c) Notification of Liens or other Material Claims. The Borrower
will, immediately upon becoming aware thereof, notify the Agent in writing of
any Liens (except Permitted Liens) placed upon or attaching to any Mortgaged
Properties or of any other setoff, claims (including environmental claims),
withholdings or other defenses which could have a Material Adverse Effect.
(d) Notice of Litigation and Judgments. The Borrower will give
notice to the Agent in writing within fifteen (15) days of becoming aware of any
litigation or proceedings threatened in writing or any pending litigation and
proceedings affecting any of the Mortgaged Properties or affecting the Borrower,
the Company, any Guarantor or any of the Related Companies or to which the
Borrower, the Company, any Guarantor or any of the Related Companies is or is to
become a party involving an uninsured claim (or as to which the insurer reserves
rights) against the Borrower, the Company, any Guarantor or any of the Related
Companies that at the time of giving of notice could reasonably be expected to
have a Materially Adverse Effect, and stating the nature and status of such
litigation or proceedings. The Borrower will give notice to the Agent, in
writing, in form and detail satisfactory to the Agent, within ten (10) days of
any final judgment not covered by insurance against the Borrower, the Company,
any Guarantor or any of the Related Companies in an amount in excess of
$500,000.
(e) Notice of Default under Major Leases. The Borrower will
immediately notify the Agent in writing of the occurrence of any failure of any
of the Major Tenants to materially comply with any of the material terms,
covenants, conditions or agreements under any of the
Major Leases.
(f) Notice of Equity Prospectus Amendment. The Company will promptly
notify the Lenders of any further amendment to the Equity Prospectus, which
notice shall include a copy of any such amendment.
(g) Notice of Expected Receipt of Net Offering Proceeds. At least
three (3) Business Days prior to the date on which the Company or the Borrower
expects to receive Net Offering Proceeds, the Borrower or the Company, as
applicable will notify the Agent of the expected amount of Net Offering Proceeds
and the expected date of receipt thereof and shall immediately notify the Agent
of any changes in the information set forth in such notice.
(S)7.6. Existence; Maintenance of REIT Status; Maintenance of Properties.
The Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its existence as a Maryland trust and its status
as a self administered real estate investment trust under the Code, the
existence of Borrower as a Delaware limited partnership and the existence of
each Guarantor Subsidiary. The Borrower will do or cause to be done all things
necessary to preserve and keep in full force all of its rights and franchises
which in the judgment of the Borrower may be necessary to properly and
advantageously conduct the businesses being conducted by it, the Company or any
of the Related Companies. The Borrower (a) will cause all of the properties used
or useful in the conduct of the business of Borrower, the Company or any of the
Related Companies to be maintained and kept in good condition, repair and
working order, subject to ordinary wear and tear, and supplied with all
necessary equipment, (b) will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Borrower may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times, and (c)
will continue to engage primarily in the businesses now conducted by it and in
related businesses, provided that such business shall not include the ownership
of any material assets which are not Permitted Acquisitions or Investments
permitted pursuant to (S)8.3.
(S)7.7. Insurance. The Borrower will maintain insurance on the Mortgaged
Properties as required by the Security Deeds. With respect to other properties
and businesses of Borrower, the Guarantors and the Related Companies, the
Borrower will maintain or cause to be maintained insurance with financially
sound and reputable insurers against such casualties and contingencies in
amounts, containing such terms, in such forms and for such periods as may be
reasonable and prudent in the judgment of the Company's officers.
(S)7.8. Taxes. The Borrower will pay real estate taxes, other taxes,
assessments and other governmental charges against the Mortgaged Properties
before the same become delinquent, and will duly pay and discharge, or cause to
be paid and discharged, before the same shall become overdue, all taxes,
assessments and other governmental charges imposed upon it and its other
properties, sales and activities, or any part thereof, or upon the income or
profits therefrom, as well as all claims for labor, materials, or supplies that
if unpaid might by law become a lien or charge upon any of its properties;
provided that any such tax, assessment, charge, levy or claim with respect to
properties other than the Mortgaged Properties need not be
paid if the validity or amount thereof shall currently be contested in good
faith by appropriate proceedings and if the Borrower shall have set aside on its
books adequate reserves with respect thereto; and provided further that the
Borrower will pay all such taxes, assessments, charges, levies or claims
forthwith upon the commencement of proceedings to foreclose any lien that may
have attached as security therefor. Promptly after payment of real estate taxes,
other taxes, assessments and other governmental charges against the Mortgaged
Properties, Borrower will provide evidence of such payments to the Agent, in the
form of receipted tax bills or other form reasonably acceptable to the Agent.
Notwithstanding anything contained herein to the contrary, with respect to the
Mortgaged Properties, Borrower, after receipt of notice from the Agent (which
notice may be given by the Agent at any time after the occurrence of an Event of
Default) , shall deposit with Agent, on the first day of each month thereafter,
a sum determined by Agent to be sufficient to provide, in the aggregate, a fund
adequate to pay all real estate taxes, other taxes, assessments and other
governmental charges against the Mortgaged Properties at least ten (10) days
before the same becomes delinquent; and whenever the Agent determines sums
accumulated under such escrow to be insufficient to meet the obligations for
which such deposits were made, the Borrower shall pay, on the demand of the
Agent, any amount required to cover the deficiency therein.
(S)7.9. Inspection of Properties and Books; Confidential Information. The
Borrower shall permit the Lenders, through the Agent or any of the Lenders'
other designated representatives, to visit and inspect any of the Mortgaged
Properties, to examine the books of account of the Borrower, the Company and the
Related Companies (and to make copies thereof and extracts therefrom) and to
discuss the affairs, finances and accounts of the Borrower with, and to be
advised as to the same by, its officers, all at such reasonable times and
intervals as the Agent or any Lender may reasonably request. Each Lender
understands that in the course of its exercise of its rights set forth herein,
the Lender may obtain information relating to Borrower or the Company or a
Property which is of a confidential nature (the "Confidential Information").
Each Lender agrees that it will not, at any time, divulge, publish or disclose,
or authorize or permit any other person to divulge, publish or disclose, to any
Person, any of the Confidential Information, provided, however, that the
Confidential Information may be disclosed by any Lender (a) to its officers,
attorneys, and accountants, (b) to any regulator or other governmental agency
with supervisory authority over the business of such Lender, (c) to any other
Person to the extent required by applicable law or regulation, and (d) to the
extent that such Confidential Information is otherwise publicly available from
sources other than such Lender.
(S)7.10. Compliance with Laws, Contracts, Licenses, and Permits. The
Borrower will comply in all material respects, the Company will comply in all
material respects and the Borrower will cause each Guarantor and all Related
Companies to comply in all material respects, with (a) all applicable laws and
regulations now or hereafter in effect wherever its business is conducted,
including all Environmental Laws, (b) the provisions of all applicable
partnership agreements, charter documents and by-laws, (c) all agreements and
instruments to which it is a party or by which it or any of its Real Estate
Assets may be bound including the Leases, and (d) all applicable decrees,
orders, and judgments.
(S)7.11. Use of Proceeds. Subject to the provisions of (S)2.5 hereof, the
proceeds of the Loans shall be used by the Borrower for Permitted Acquisitions
and Permitted Developments,
for refinancing other Indebtedness, and for working capital and other purposes
consistent with the covenants contained herein.
(S)7.12. Appraisals. The Appraised Values of the Mortgaged Properties,
including the Appraised Values of Additional Properties determined pursuant to
Appraisals approved by the Requisite Lenders pursuant to (S)10. 14 and
(S)5.4(b), may increase or decrease only upon the approval by the Requisite
Lenders of a new or updated Appraisal of such Mortgaged Property. The Agent
shall order a new or updated Appraisal of a Mortgaged Property (i) promptly
following a written request from the Borrower, (ii) in the discretion of the
Agent if the occupied percentage of the gross leasable area of the Buildings on
such Mortgaged Property for two (2) consecutive fiscal quarters is more than 20
percentage points lower than the occupancy percentage shown on the rent roll for
such Mortgaged Property attached as Schedule 6.22(l) hereto, (iii) if, in the
Agent's opinion, there has been a substantial adverse change in market
conditions; (iv) as may be required by regulatory requirements applicable to any
Lender; and (v) following an Event of Default, if requested by any Lender. The
Borrower shall provide to the Agent all available information needed to assist
in the preparation of an Appraisal and shall pay to the Agent on demand all
reasonable costs of all such Appraisals.
(S)7.13. Leases; Lease Approvals. The Borrower will not include in any
Leases any purchase option or right of first refusal to purchase any Mortgaged
Property. The Borrower will at all times exercise or enforce its material rights
under the Leases. During the continuance of an Event of Default, the Agent shall
have the right, and the Borrower hereby authorizes the Agent, to communicate
directly with any of the tenants or guarantors for any purpose contemplated by
this Agreement or any of the Security Documents. Any proposed lease which would
be a Major Lease shall be submitted to and approved by the Lead Lenders prior to
execution, along with the most recent financial statements of such proposed
tenant and any guarantor. The Borrower will not materially adversely amend,
terminate, or accept a surrender of any Major Lease or release any Major Tenant
or waive the material performance of a Major Lease by a Major Tenant, in each
case without prior approval of the Lead Lenders. The Lead Lenders shall not
unreasonably withhold their approval of any Major Lease or amendment thereof. If
the Lead Lenders fail to respond within five (5) Business Days after receipt of
any proposed Major Lease or amendment of a Major Lease, the same shall be deemed
to be approved.
(S)7.14. Further Assurance. The Borrower will cooperate with the Agent and
the Lenders and execute such further instruments and documents and perform such
further acts as the Agent and the Lenders shall reasonably request to carry out
to their satisfaction the transactions contemplated by this Agreement and the
other Loan Documents and the granting and perfecting of all liens in the
Collateral for the benefit of the Agent as agent for the Lenders.
(S)7.15. Environmental Indemnification. Each of the Borrower and the
Company, jointly and severally, covenants and agrees that it will indemnify and
hold the Agent and each Lender harmless from and against any and all claims,
expense, damage, loss or liability incurred by the Agent or any Lender
(including all reasonable costs of legal representation incurred by the Agent or
any Lender , but excluding, as applicable, for the Agent or a Lender any claim,
expense, damage, loss or liability as a result of the gross negligence or
willful misconduct of the
Agent or such Lender) relating to (a) any Release or threatened Release of
Hazardous Materials on, upon, into or from any Mortgaged Property or any Real
Estate; (b) any violation of any Environmental Laws with respect to conditions
at any Mortgaged Property or the operations conducted thereon; or (c) the
investigation or remediation of off-site locations at which the Borrower or its
predecessors are alleged to have directly or indirectly disposed of Hazardous
Materials. It is expressly acknowledged by the Borrower that this covenant of
indemnification shall survive any foreclosure or any modification, release or
discharge of any or all of the Security Documents or the payment of the Loans
and shall inure to the benefit of the Agent and the Lenders, and their
successors and assigns.
(S)7.16. Response Actions. The Borrower covenants and agrees that if any
Release or disposal of Hazardous Materials shall occur or shall have occurred
on, upon, into or from any Mortgaged Property, or on, upon, into or from any
other Real Estate if the same would have a Material Adverse Effect, the Borrower
will cause the prompt containment and removal of such Hazardous Materials and
remediation of such Mortgaged Property or Real Estate as necessary to comply in
all material respects with all applicable Environmental Laws or to preserve the
value of such Mortgaged Property.
(S)7.17. Environmental Assessments. The Borrower shall diligently and
continuously comply with all recommendations set forth in the Environmental
Reports, including, without limitation, the completion of the remediation
projects described therein. Upon written request, the Borrower shall provide the
Agent with periodic reports with respect to the progress of said remediation
projects. If the Agent in its good faith judgment, after discussion with the
Borrower and the Lead Lenders, has reason to believe that the environmental
condition of any Mortgaged Property has deteriorated, after reasonable notice by
the Agent, whether or not a Default or an Event of Default shall have occurred,
the Agent may, from time to time, for the purpose of assessing and ensuring the
value of such Mortgaged Property, obtain one or more environmental assessments
or audits of such Mortgaged Property prepared by a hydrogeologist, an
independent engineer or other qualified consultant or expert approved by the
Agent to evaluate or confirm (i) whether any Hazardous Materials are present in
the soil or water at such Mortgaged Property in such quantities as to require
remediation or clean-up to prevent or mitigate damage or threats to the public
health, safety or welfare or the environment and (ii) whether the use and
operation of such Mortgaged Property complies in all material respects with all
applicable Environmental Laws. Environmental assessments may include without
limitation detailed visual inspections of such Mortgaged Property including,
without limitation, any and all storage areas, storage tanks, drains, dry xxxxx
and leaching areas, and the taking of soil samples, surface water samples and
ground water samples, as well as such other investigations or analyses as the
Agent deems appropriate. All such environmental assessments shall be at the sole
cost and expense of the Borrower; provided, however, the Agent may not require
environmental assessments at the Borrower's expense, with respect to any
Mortgaged Property, more frequently than annually except (i) during the
continuance of an Event of Default or (ii) upon the occurrence of a Release on,
upon, into or from any Mortgaged Property.
(S)7.18. Employee Benefit Plans.
(a) Representation. The Borrower and its ERISA Affiliates do not
currently maintain or contribute to any Employee Benefit Plan, Guaranteed
Pension Plan or Multiemployer Plan.
(b) Notice. The Borrower will notify the Agent promptly following the
establishment of any Employee Benefit Plan or Guaranteed Pension Plan by the
Borrower or any ERISA Affiliate.
(c) In General. Each Employee Benefit Plan maintained by the Borrower
or any ERISA Affiliate will be operated in compliance in all material respects
with the provisions of ERISA and, to the extent applicable, the Code, including
but not limited to the provisions thereunder respecting prohibited transactions.
(d) Terminability of Welfare Plans. With respect to each Employee
Benefit Plan maintained by the Borrower or an ERISA Affiliate which is an
employee welfare benefit plan within the meaning of (S)3(1) or (S)3(2)(B) of
ERISA, the Borrower, or the ERISA Affiliate, as the case may be, has the right
to terminate each such plan at any time (or at any time subsequent to the
expiration of any applicable bargaining agreement) without liability other than
liability to pay claims incurred prior to the date of termination.
(e) Multiemployer Plans. Without the consent of the Agent, the
Borrower will not enter into, maintain or contribute to, any multiemployer Plan.
(f) Unfunded or Underfunded Liabilities. The Borrower will not, at
any time, have accruing unfunded or underfunded liabilities with respect to any
Employee Benefit Plan, Guaranteed Pension Plan or Multiemployer Plan, or permit
any condition to exist under any Multiemployer Plan that would create a
withdrawal liability.
(S)7.19. Required Interest Rate Contracts. The Borrower shall maintain in
effect the Interest Rate Contracts in form and substance reasonably satisfactory
to the Lead Lenders with respect to that portion of the Variable Rate
Indebtedness which exceeds, excluding the IRB Indebtedness, the principal amount
of $125,000,000.
(S)7.20. Equity Interests in the Company. The Company will comply in all
material respects with all applicable rules and regulations of the Securities
Exchange Commission and of relating to its publicly held Common Shares and
Preferred Shares. The Company will continue to have its Common Shares listed on
the New York Stock Exchange or on one of the other major stock exchanges in the
United States, and will comply in all material respects with all applicable
rules of the stock exchange where the Common Shares are so listed. Immediately
upon the receipt of any Net Offering Proceeds, 100% thereof shall be contributed
to the Borrower as an additional capital contribution with respect to the
Company's general partnership interest in the Borrower.
(S)7.21. Year 2000 Problem. The Borrower shall promptly conduct a
comprehensive review and assessment of its computer applications and make
inquiry of its property managers with respect to the "year 2000 problem" (i.e.
the risk that computer applications may not be able
to properly perform date-sensitive functions after December 31, 1999) and, based
on that review and inquiry, take appropriate actions to assure that the year
2000 problem will not result in a Material Adverse Effect.
(S)8. CERTAIN NEGATIVE COVENANTS OF THE BORROWER. The Borrower covenants
and agrees as follows, and to the extent that the following covenants relate to
the Company, the Company covenants and agrees as follows, so long as any Loan,
Note or Letter of Credit is outstanding or the Lenders have any obligation to
make any Loans or issue any Letters of Credit:
(S)8.1 Restrictions on Indebtedness. Except with the prior written consent
of the Requisite Lenders, the Borrower will not, the Company will not, and the
Borrower will not permit any Guarantor, any of the Related Companies or any
Permitted Joint Venture to create, incur, assume, guarantee or become or remain
liable, contingently or otherwise, or agree not to do any of same with respect
to any Indebtedness other than:
(a) Indebtedness to the Lenders arising under any of the Loan
Documents;
(b) current liabilities of the Borrower incurred in the ordinary
course of business but not incurred through (i) the borrowing of money, or (ii)
the obtaining of credit except for credit on an open account basis customarily
extended and in fact extended in connection with normal purchases of goods and
services;
(c) Indebtedness in respect of taxes, assessments, governmental
charges or levies and claims for labor, materials and supplies to the extent
that payment therefor shall not at the time be required to be made in accordance
with the provisions of (S)7.8;
(d) Indebtedness in respect of judgments or awards that have been
in force for less than the applicable period for taking an appeal so long as
execution is not levied thereunder or in respect of which the Borrower shall at
the time in good faith be prosecuting an appeal or proceedings for review and in
respect of which a stay of execution shall have been obtained pending such
appeal or review;
(e) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the ordinary course
of business;
(f) Indebtedness of Borrower, the Company or the Related Companies
to the extent the same does not create a violation of (S)9.3, (S)9.5 or (S)9.6
provided that the maximum principal amount of Recourse Indebtedness permitted
under this paragraph shall not exceed $50,000,000 in the aggregate at any time
outstanding. Schedule 8.1(f) attached hereto sets forth the existing
Indebtedness (and proposed indebtedness for which Borrower has accepted a
commitment letter) included within such limit on Recourse Indebtedness.
(S)8.2. Restrictions on Liens, Etc. The Borrower will not, and will not
permit Guarantor, any of the Related Companies or any Permitted Joint Venture
to, (a) create or incur or agree not
to create or incur or suffer to be created or incurred or to exist any lien,
encumbrance, mortgage, pledge, charge, restriction or other security interest of
any kind upon any of the Mortgaged Property of any character whether now owned
or hereafter acquired, or upon the rents, income or profits therefrom; (b)
suffer to exist for a period of more than thirty (30) days after the same shall
have been incurred any Indebtedness (not permitted by (S)8.1(c)) or claim or
demand against it that if unpaid might by law or upon bankruptcy or insolvency,
or otherwise, be given any priority whatsoever over the Security Documents; or
(c) sell, assign, pledge or otherwise transfer any rents, issues, profits,
accounts, contract rights or general intangibles relating to any of the
Mortgaged Premises; provided that the Borrower may create or incur or suffer to
be created or incurred or to exist:
(i) liens to secure taxes, assessments and other governmental
charges in respect of obligations not overdue, the Indebtedness with respect to
which is permitted by (S)8.1(c);
(ii) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age pensions or
other social security obligations;
(iii) liens in respect of judgments or awards, the Indebtedness with
respect to which is permitted by (S)8.1(d);
(iv) liens of carriers, warehousemen, mechanics and materialmen, and
other like liens on properties other than the Mortgaged Properties in existence
less than 120 days from the date of creation thereof in respect of obligations
not overdue, the Indebtedness with respect to which is permitted by (S)8.1(c);
(v) encumbrances consisting of easements, rights of way, covenants,
restrictions on the use of real property and defects and irregularities in the
title thereto; and other minor liens or encumbrances none of which in the
reasonable judgment of the Borrower interferes materially with the use of the
property affected in the ordinary conduct of the business of the Borrower, and
which matters (x) do not individually or in the aggregate have a materially
adverse effect on the value of the Mortgaged Property and (xx) do not make title
to such property unmarketable by the conveyancing standards in effect where such
property is located;
(vi) the Leases referenced on Schedule 6.22(l) and any other Leases
permitted by this Agreement or otherwise approved by the Lead Lenders;
(vii) presently outstanding liens and other encumbrances on the
Mortgaged Properties listed on Schedule B to the Title Policies;
(viii) liens in favor of the Agent and/or any of the Lenders granted
pursuant to the Security Documents; and
(ix) financing statements disclosed by the searches described in
(S)10.18.
(S)8.3. Restrictions on Investments. The Borrower will not, and will not
permit any Guarantor, any of the Related Companies or any Permitted Joint
Venture to make or permit to exist or to remain outstanding any Investment
except Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America that mature within one (1) year from the date of purchase by
the Borrower;
(b) demand deposits, certificates of deposit, repurchase
agreements, bankers acceptances and time deposits of United States banks having
total assets in excess of $1,000,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States of
America or any state thereof that at the time of purchase have been rated and
the ratings for which are not less than " P 1 " if rated by Xxxxx'x Investors
Services, Inc., and not less than "A 1" if rated by Standard and Poor's;
(d) Investments existing or contemplated on the date hereof and
listed on Schedule 8.3(d) hereto;
(e) Investments made in the ordinary course of the Borrower's
business, in (i) any mortgages the acquisition of which is expressly approved by
the Requisite Lenders, (ii) mortgages and notes receivable having an aggregate
principal amount, exclusive of any investments in mortgages which may have been
so expressly approved by the Requisite Lenders, of not more than $25,000,000,
(iii) Permitted Joint Ventures (to the extent permitted by (S)8.4(a)), or (iv)
Interest Rate Contracts;
(f) Investments in Permitted Acquisitions;
(g) Investments in Permitted Developments which shall not exceed
20% of Total Adjusted Assets; provided that within said limit any single
development project with a total cost in excess of $30,000,000 shall only be a
Permitted Development after it has been approved by the Requisite Lenders;
(h) Investments in undeveloped land which shall not exceed 10% of
Total Adjusted Assets.
(S)8.4. Merger, Consolidation and Disposition of Properties.
(a) The Borrower will not, and will not permit the Company, any of
the Related Companies or any Permitted Joint Venture to (i) become a party to
any merger or consolidation, or (ii) agree to or effect any property acquisition
or stock acquisition (other than Permitted Acquisitions in compliance with the
other terms of this Agreement) , or (iii) enter into any joint venture or invest
in any Permitted Joint Venture unless prior to such transaction the Borrower has
provided the Lead Lenders with a notice describing such transaction, the
Borrower shall have obtained the prior consent of the Lead Lenders, provided
that no merger or consolidation shall be
permitted (except mergers among the Related Companies and the Borrower) unless
the surviving entity is the Borrower, there is no material change in the type of
business conducted by the Borrower and no Default or Event of Default will
result from such transaction.
(b) Real Estate Assets may be sold or transferred except that to the
extent the aggregate sales price of all such dispositions during any fiscal
quarter shall exceed $10,000,000, prior to such sale or transfer, the Borrower
shall provide to the Agent a statement in the form of Exhibit C hereto signed by
a Responsible Officer of the Company and setting forth in reasonable detail
computations evidencing compliance with the financial covenants contained in
(S)9 after giving effect to such proposed transfer and all liabilities, fixed or
contingent, pursuant thereto.
(S)8.5. Sale and Leaseback. The Borrower will not enter into any
arrangement, directly or indirectly, whereby the Borrower shall sell or transfer
any property owned by it in order then or thereafter to lease such property or
lease other property that the Borrower intends to use for substantially the same
purpose as the property being sold or transferred. The Borrower will not permit
the Company, any of the Related Companies or any Permitted Joint Venture to
enter into any such arrangement.
(S)8.6. Compliance with Environmental Laws. The Borrower will not do, and
will not permit the Company, any of the Related Companies or any Permitted Joint
Venture to do, any of the following: (a) use any of the Real Estate or any
portion thereof as a facility for the handling, processing, storage or disposal
of Hazardous Materials except for Hazardous Materials used in the operation of
the Real Estate and in material compliance with applicable law, (b) cause or
permit to be located on any of the Real Estate any underground tank or other
underground storage receptacle for Hazardous Materials except in material
compliance with Environmental Laws, (c) generate any Hazardous Materials on any
of the Real Estate except in material compliance with Environmental Laws, or (d)
conduct any activity at any Real Estate or use any Real Estate in any manner so
as to cause a Release requiring remediation, clean up or other response action
under applicable Environmental Laws.
(S)8.7. Distributions. Borrower shall not permit the total Distributions
by it and the Company during any fiscal year to exceed 90% of Funds from
Operations for such year and shall not permit there to be more than two
consecutive fiscal quarters during which the total Distributions by Borrower and
the Company during each fiscal quarter exceed 100% of Funds from Operations for
such fiscal quarter except that such limitations may be exceeded to the extent
necessary for the Company to maintain its REIT status provided that the Company
provides the Agent with a letter from its accountants or attorneys setting forth
the basis for computation of the amount of such necessary excess Distributions.
No Distribution by the Borrower to the Company shall be made other than
simultaneously with and in the same amount as the corresponding Distribution by
the Company to the owners of the Common Shares and/or the Preferred Shares.
During any period when an Event of Default under (S)12.1(a) or (S)12.1(b) has
occurred and is continuing total Distributions by the Borrower and the Company
will not exceed the minimum amount necessary for the Company to maintain its
REIT status.
(S)8.8. Leases. The Borrower will not (i) enter into any Major Leases or
(ii) materially
amend, supplement or otherwise materially modify, or terminate or cancel, or
accept the surrender of, or grant any material concessions to or waive the
material performance of any of the Major Tenants under the Major Leases, in each
case without the prior approval of the Lead Lenders as provided in (S)7.13.
(S)8.9. Restrictions on the Company. The Company will not:
(a) own any assets, or have any Investments, other than owning its
general partnership interest in the Borrower and its limited partnership
interests described in (S)6.19.
(b) engage in any business other than its activities as managing
general partner of the Borrower.
(c) directly or indirectly convey, sell, transfer, assign, pledge or
encumber any of its partnership interest in the Borrower.
(d) create, incur, assume, guarantee or become or remain liable for,
contingently or otherwise, any Indebtedness, and any recourse against the
Company with respect to the Indebtedness of the Borrower shall be limited to the
same or greater extent as recourse against the Company with respect to the
Obligations as provided in (S)28.
(S)9. FINANCIAL COVENANTS OF THE BORROWER. The Borrower covenants and
agrees as follows, so long as any Loan or Note is outstanding or any Lender has
any obligation to make any Loan:
(S)9.1. Collateral Value. The Borrower will not at any time permit the
Outstanding Principal Amount to exceed the sum of (i) sixty percent (60%) of the
total of the Collateral Values of the Mortgaged Properties other than the
Assigned Mortgaged Properties plus (ii) fifty percent (50%) of the total of the
Collateral Values of the Assigned Mortgaged Properties.
(S)9.2. Minimum Debt Service Coverage. The Borrower will not at any time
permit the Outstanding Principal Amount to exceed an amount such that: (a) the
aggregate of the Net Operating Income for all of the Mortgaged Properties,
divided by (b) Pro Forma Debt Service Charges for the Mortgaged Properties would
be less than 1.5 for any fiscal quarter of Borrower. For purposes of the
foregoing, any Real Estate Asset that became a Mortgaged Property during the
applicable fiscal quarter shall be treated as though it were a Mortgaged
Property for the entire quarter and any Real Estate Asset which is released by
Agent during such fiscal quarter shall be excluded for the entire quarter.
(S)9.3. Total Liabilities to Total Adjusted Assets. The Borrower will not
at any time permit Total Liabilities at the end of any fiscal quarter to exceed
fifty-five percent (55%) of Total Adjusted Assets.
(S)9.4. Minimum Tangible Net Worth. The Borrower will not at any time
permit the Tangible Net Worth of the Borrower to be less than $350,000,000 plus
75% of Net Offering
Proceeds.
(S)9.5. Total Operating Cash Flow to Interest Expense. The Borrower will
not permit the ratio of its Total Operating Cash Flow to Interest Expense to be
less than 2.0 to 1.0 for any fiscal quarter. For the fiscal quarter ending
December 31, 1997, such covenant will be computed on a pro forma basis as though
the Formation Transactions had closed, and the Facility Closing Date had been,
October 1, 1997.
(S)9.6. EBITDA to Fixed Charges. The Borrower will not permit the ratio
of its EBITDA to Fixed Charges to be less than 1.75 to 1.0 for any fiscal
quarter. For the fiscal quarter ending December 31, 1997, such convenant will be
computed on a pro forma basis as though the Formation Transactions had closed,
and the Facility Closing Date had been, October 1, 1997.
(S)10. CONDITIONS TO EFFECTIVENESS. This Third Amendment to Credit
Agreement shall become effective when each of the following conditions precedent
have been satisfied (including any updated certificates or other documents
requested by the Agent with respect to any of the following conditions which
were previously satisfied on or about the Facility Closing Date or the dates
that certain Additional Properties became Mortgaged Properties hereunder):
(S)10.1. Loan Documents. Each of (i) this Third Amendment to Credit
Agreement, (ii) the Third Amendment to the Guaranty, (iii) the Loan Notes for
the Syndication Lenders and (iv) the replacement Loan Notes for the Lead Lenders
shall have been duly executed and delivered by the respective parties thereto,
shall be in full force and effect and shall be in form and substance
satisfactory to each of the Lenders.
(S)10.2. Certified Copies of Organization Documents; Good Standing
Certificates. The Agent shall have received (i) a Certificate of the Company to
which there shall be attached complete copies of the Borrower's Limited
Partnership Agreement and its Certificate of Limited Partnership, certified as
of a recent date by the Secretary of State of Delaware, (ii) Certificates of
Good Standing for the Borrower from the State of Delaware and each State in
which a Mortgaged Property is located, (iii) a copy of the Company's Declaration
of Trust certified by the Maryland Secretary of State, (iv) Certificates of Good
Standing for the Company from the State of Maryland and each State in which a
Mortgaged Property is located unless the Company's qualification is not required
by the laws of such state, and (v) certificates of good standing and certified
copies of partnership agreements and certificates of limited partnership with
respect to each of the Guarantor Subsidiaries.
(S)10.3. By-laws; Resolutions. All action on the part of the Borrower and
each Guarantor necessary for the valid execution, delivery and performance by
the Borrower and each Guarantor of this Agreement and the other Loan Documents
to which it is or is to become a party shall have been duly and effectively
taken, and evidence thereof satisfactory to the Agent shall have been provided
to the Agent. The Agent shall have received from the Company true copies of its
by-laws and the resolutions adopted by its Board of Directors authorizing the
transactions described herein, each certified by its secretary to be true and
complete and in effect on the
Effective Date.
(S)10.4. Incumbency Certificate; Authorized Signers. The Agent shall have
received from the Company an incumbency certificate, dated as of the Effective
Date, signed by a duly authorized officer of the Company and giving the name and
bearing a specimen signature of each individual who shall be authorized: (a) to
sign, in the name and on behalf of the Company (in its own capacity and as
general partner on behalf of Borrower and on behalf of each Guarantor Subsidiary
which is a partnership), each of the Loan Documents to which the Borrower or any
Guarantor is or is to become a party; (b) to make Loan Requests and Conversion
Requests; and (c) to give notices and to take other action on behalf of the
Borrower under the Loan Documents.
(S)10.5. Opinions of Counsel. Each of the Lenders and the Agent shall have
received favorable opinions addressed to the Lenders and the Agent and dated as
of the Effective Date, substantially in the same form as, or with appropriate
provisions incorporating by reference, the opinions from Borrower's counsel
previously delivered to the Lenders and the Agent, copies of which are attached
hereto as Exhibit E. Such opinion may rely on opinions from other law firms
approved by the Agent as to matters of law applicable in the various states
where the Mortgaged Properties are located.
(S)10.6. Payment of Fees. The Borrower shall have paid to the Agent and/or
the Lead Lenders the fees pursuant to (S)4.1 and (S)2.9(a) and shall have paid
all other expenses as provided in (S)15 hereof then outstanding.
(S)10.7. Validity of Liens. The Security Documents shall be effective to
create in favor of the Agent legal, valid and enforceable first priority,
perfected liens and security interests in the Collateral covered thereby,
subject only to the Permitted Liens. All filings, recordings, deliveries of
instruments and other actions or consents necessary or desirable in the
reasonable opinion of the Agent to grant, perfect, protect and preserve such
liens and security interests shall have been duly effected. The Agent shall have
received evidence thereof in form and substance reasonably satisfactory to the
Agent.
(S)10.8. Survey. The Agent shall have received Surveys of the Mortgaged
Properties, bearing dates reasonably acceptable to the Agent, and in form and
substance reasonably acceptable to the Agent.
(S)10.9. Title Insurance; Title Exception Documents. The Agent shall have
received the Title Policies reasonably satisfactory to the Agent, together with
proof of payment of all fees and premiums for such policies. The Agent shall
have received true and accurate copies of all documents listed as exceptions
under such policies.
(S)10.10. Leases. The Agent shall have received true copies of those Leases
which the Agent may request after its review of the applicable rent roll.
(S)10.11. Estoppel and Attornment Agreements. The Agent shall have received
estoppel certificates and attornment agreements in form reasonably satisfactory
to the Lead Lenders from
the three (3) Tenants who lease and occupy the largest amount gross leasable
area of the West Xxxxxx Drive Property and from any other Major Tenants
specifically required by the Agent.
(S)10.12. Certificates of Insurance. The Agent shall have received (a) a
certificate of insurance as to the insurance maintained by Borrower on the
Mortgaged Properties (including flood insurance if necessary) from the insurer
or an independent insurance broker, identifying insurers, types of insurance,
insurance limits, and policy terms; (b) certified copies of all policies
evidencing such insurance (or certificates therefor signed by tile insurer or an
agent authorized to bind the insurer); and (c) such further information and
certificates from Borrower, its insurers and insurance brokers as the Agent may
reasonably request.
(S)10.13. Environmental Reports. The Agent shall have received an
Environmental Report with respect to each of the Mortgaged Properties, dated as
of a recent date, from environmental engineers reasonably acceptable to the
Agent which Environmental Reports shall have been approved by the Requisite
Lenders. The Environmental Reports on Schedule 6.18 have been so approved.
(S)10.14. Environmental Indemnity. The Agent shall have received an
executed original of the environmental indemnity described in the Equity
Prospectus from The Prime Group, Inc. for the benefit of certain of the
Guarantor Subsidiaries with respect to environmental liabilities relating to
certain of the Mortgaged Properties, together with an agreement from The Prime
Group, Inc. that the Lenders shall be a beneficiary thereunder in the event of
any foreclosure of the applicable Mortgaged Properties, which indemnity and
agreement shall be in form and substance satisfactory to the Agent and the Lead
Lenders.
(S)10.15. Appraisals. The Agent and each of the Lenders shall have received
Appraisals dated as of a recent date in form and substance satisfactory to the
Agent and the Lead Lenders (including satisfaction as to determination of
Appraised Value).
(S)10.16. Inspecting Engineers' Reports. The Agent shall have received
reports, addressed to Agent and the Lenders or accompanied by reliance letters
in favor of the Agent and the Lenders, from third party inspecting engineers
dated as of a date acceptable to the Agent as to the good structural condition
of the Buildings located on the Mortgaged Properties, which reports shall be in
form and substance satisfactory to the Agent and shall have been approved by the
Requisite Lenders. The reports on Schedule 6.22(d) have been so approved.
(S)10.17. Initial Letters of Credit. The Agent shall have received with
respect to each of the Initial Letters of Credit (i) a Letter of Credit Request
executed by Borrower, and (ii) copies of all legal opinions and certificates
delivered in connection with such replacement of letters of credit pursuant to
the applicable IRB Documents.
(S)10.18. UCC Lien Searches. The Agent shall have received UCC lien
searches of the applicable public records disclosing no conditional sales
contracts, security agreements, chattel mortgages, leases of personalty,
financing statements or other encumbrances which affect any of the Collateral
other than those relating to any liens permitted hereby and by the Security
Documents.
(S)11. CONDITIONS TO ALL BORROWINGS. The obligations of the Lenders to
make any Loan, whether on or after the Facility Closing Date, shall also be
subject to the satisfaction of the following conditions precedent:
(S)11.1. Representations True; No Event of Default; Compliance Certificate.
Each of the representations and warranties of the Borrower and the Company
contained in this Agreement, the other Loan Documents or in any document or
instrument delivered pursuant to or in connection with this Agreement shall be
true in all material respects as of the date as of which they were made and
shall also be true in all material respects at and as of the time of the making
of such Loan, with the same effect as if made at and as of that time (except to
the extent of changes resulting from transactions contemplated or permitted by
this Agreement and the other Loan Documents and changes occurring in the
ordinary course of business that singly or in the aggregate are not materially
adverse, and except to the extent that such representations and warranties
relate expressly to an earlier date); the Borrower shall have performed and
complied with all terms and conditions herein required to be performed by it or
prior to the Borrowing Date of such Loan; and no Default or Event of Default
shall have occurred and be continuing on the date of any Loan Request or on the
Borrowing Date of such Loan. Each of the Lenders shall have received a
Compliance Certificate of the Borrower signed by a Responsible Officer to such
effect, which certificate will include, without limitation, computations
evidencing compliance with the covenants contained in (S)9 hereof after giving
effect to such requested Loan.
(S)11.2. No Legal Impediment. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Lender would make it illegal for such Lender to make such Loan.
(S)11.3. Governmental Regulation. Each Lender shall have received such
statements in substance and form reasonably satisfactory to such Lender as such
Lender shall require for the purpose of compliance with any applicable
regulations of the Comptroller of the Currency or the Board of Governors of the
Federal Reserve System.
(S)11.4. Proceedings and Documents. All proceedings in connection with the
transactions contemplated by this Agreement, the other Loan Documents and all
other documents incident thereto shall be reasonably satisfactory in substance
and in form to the Agent, and the Lenders shall have received all information
and such counterpart originals or certified or other copies of such documents as
the Agent may reasonably request.
(S)12. EVENTS OF DEFAULT; ACCELERATION; ETC.
(S)12.1. Events of Default and Acceleration. If any of the following
events ("Events of Default" or, if the giving of notice or the lapse of time or
both is required, then, prior to such notice or lapse of time, "Defaults") shall
occur:
(a) the Borrower shall fail to pay any principal of the Loans when
the same shall become due and payable;
(b) the Borrower shall fail to pay any interest on the Loans or any
other sums due hereunder or under any of the other Loan Documents within five
(5) days after the same shall become due and payable or the Borrower shall fail
to deposit in the IRB Indebtedness Account sufficient funds as required by
(S)2.8;
(c) the Borrower or the Company shall fail to comply with any of its
covenants contained in (S)7.5, the first sentence of (S)7.6, the first sentence
of (S)7.7, (S)7.20, (S)8 or (S)9 hereof;
(d) the Borrower, the Company or any Guarantor shall fail to perform
any other term, covenant or agreement contained herein or in any of the other
Loan Documents (other than those specified elsewhere in this (S)12) for thirty
(30) days after written notice of such failure from Agent to the Borrower,
provided, however that if the Borrower fails to give notice of any Default as
required by (S)7.5(a), such thirty (30) day cure period shall be deemed to have
started on the date such notice should have been given;
(e) any representation or warranty of the Borrower or the Company in
this Agreement or any of the other Loan Documents or in any other document or
instrument delivered pursuant to or in connection with this Agreement, shall
prove to have been false in any material respect upon the date when made or
deemed to have been made or repeated, and shall continue to be false on the date
that the Agent or any Lender takes action based on the Default relating to such
representation or warranty, provided, however, that with respect to the
representations and warranties of the Borrower contained in (S)6.2, (S)6.3,
(S)6.13, (S)6.18 and in paragraphs (a), (c), (d), (e) and (f) of (S)6.22, if the
condition or event making the representation and warranty false is capable of
being cured by the Borrower, no enforcement action has been commenced against
the Borrower or the applicable Mortgaged Property on account of such condition
or event nor is the applicable Mortgaged Property subject to risk of forfeiture
due to such condition or event, and the Borrower promptly commences the cure
thereof after the Borrower's first obtaining knowledge of such condition or
event, the Borrower shall have a period of thirty (30) days after the date that
the Borrower first obtained knowledge of such condition or event during which
the Borrower may cure such condition or event (or, if such condition or event is
not reasonably capable of being cured within such thirty (30) day period, such
additional period of time as may be reasonably required in order to cure such
condition or event but in any event such period shall not exceed six (6) months
from the date that the Borrower first obtained knowledge of such condition or
event), and no Event of Default shall exist hereunder during such thirty (30)
day or additional period so long as the Borrower continuously and diligently
pursues the cure of such condition or event and the other conditions to such
cure period have not changed;
(f) the Borrower, the Company, any of the Related Companies or any
Permitted Joint Venture shall fail to pay at maturity, or within any applicable
period of grace, any Recourse Indebtedness, or shall fail to observe or perform
any material term, covenant or agreement contained in any agreement by which it
is bound, evidencing or securing Indebtedness for such period of time as would
permit (assuming the giving of appropriate notice if required) the holder or
holders thereof or of any obligations issued thereunder to accelerate the
maturity thereof, and
in any event, such failure shall continue for thirty (30) days, unless the
aggregate amount of all such defaulted Recourse Indebtedness plus the amount of
any unsatisfied judgments described in paragraph (i) of this (S)12.1 is less
than $10,000,000.00;
(g) any of the Borrower, the Company or any Guarantor shall make an
assignment for the benefit of creditors, or admit in writing its inability to
pay or generally fail to pay its debts as they mature or become due, or shall
petition or apply for the appointment of a trustee or other custodian,
liquidator or receiver of any substantial part of its properties or shall
commence any case or other proceeding under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or liquidation or
similar law of any jurisdiction, now or hereafter in effect, or shall take any
action to authorize or in furtherance of any of the foregoing, or if any such
petition or application shall be filed or any such case or other proceeding
shall be commenced against any such Person and such Person shall indicate its
approval thereof, consent thereto or acquiescence therein or any of the events
described in this paragraph shall occur with respect to any other Related
Company or any Permitted Joint Venture and such event shall have a Material
Adverse Effect;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower, the Company, or
any Guarantor bankrupt or insolvent, or approving a petition in any such case or
other proceeding, or a decree or order for relief is entered in respect of the
Borrower, the Company, or any Guarantor in an involuntary case under federal
bankruptcy laws as now or hereafter constituted or any of the events described
in this paragraph shall occur with respect to any other Related Company or any
Permitted Joint Venture and such event shall have a Material Adverse Effect;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty days, whether or not consecutive, any uninsured
final judgment against the Borrower that, with other outstanding uninsured final
judgments, undischarged, against the Borrower, the Company or any of the Related
Companies plus the amount of any defaulted Recourse Indebtedness under paragraph
(f) of this (S)12.1, exceeds in the aggregate $10,000,000.00;
(j) if any of the Loan Documents or any material provision of any
Loan Documents shall be unenforceable, cancelled, terminated, revoked or
rescinded otherwise than in accordance with the terms thereof or with the
express prior written agreement, consent or approval of the Agent, or any action
at law, suit or in equity or other legal proceeding to make unenforceable,
cancel, revoke or rescind any of the Loan Documents shall be commenced by or on
behalf of the Borrower, the Company or any Guarantor, or any court or any other
governmental or regulatory authority or agency of competent jurisdiction shall
make a determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Loan Documents is illegal, invalid or
unenforceable in accordance with the terms thereof;
(k) the Borrower, the Company or any Guarantor shall be indicted for
a federal crime, a punishment for which could include the forfeiture of any
assets of the Borrower;
(l) any "Event of Default," as defined in any of the IRB Documents
shall occur
provided that if such Event of Default is caused by the issuer or other Person
other than the Guarantor Subsidiary, the same shall constitute an Event of
Default hereunder only if the maturity of the applicable IRB Indebtedness is
accelerated based thereon;
(m) any "Event of Default", as defined in any of the other Loan
Documents shall occur;
then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Requisite Lenders shall, by notice in writing
to the Borrower declare all amounts owing with respect to this Agreement, the
Notes and the other Loan Documents to be, and they shall thereupon forthwith
become, immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby expressly waived by the
Borrower; provided that in the event of any Event of Default specified in
(S)(S)12.1(g) or 12.1(h), all such amounts shall become immediately due and
payable automatically and without any requirement of notice from the Agent or
action by the Requisite Lenders.
(S)12.2. Termination of Commitments; Drawing of IRB Letters of Credit. If
any one or more Events of Default specified in (S)12.1(g) or (S)12.1(h) shall
occur, the Commitments hereunder shall forthwith terminate and the Lenders shall
be relieved of all obligations to make Loans or to provide Letters of Credit to
the Borrower. If any other Event of Default shall have occurred and be
continuing, any Lender may by notice to the Borrower terminate the Commitment
hereunder, and upon such notice being given its Commitment hereunder shall
terminate immediately and such Lender shall be relieved of all further
obligations to make Loans, provided, however, such Lender shall not be relieved
of its obligation to pay its Proportionate Share of Unreimbursed Drawings under
(S)2.9. No termination of such Lender's Commitment hereunder shall relieve the
Borrower of any of the Obligations or any of its existing obligations to such
Lender arising under other agreements or instruments. At any time after any
Commitments have been terminated pursuant hereto, the Agent may, in its sole
discretion, give such notices as may be permitted under the terms of the IRB
Letters of Credit or the related IRB Documents to cause the bonds relating to
the IRB Indebtedness to be accelerated or to cause a mandatory tender thereof or
to cause the IRB Letters of Credit to be drawn by the beneficiary thereof or to
cause the applicable IRB Letters of Credit to expire if not drawn within the
specified period after the giving of such notice.
(S)12.3. Remedies. In case any one or more of the Events of Default shall
have occurred, and whether or not the Requisite Lenders shall have accelerated
the maturity of the Loans pursuant to (S)12.1, each Lender, if owed any amount
with respect to the Loans, may, with the consent of the Requisite Lenders,
direct the Agent to proceed to protect and enforce the rights and remedies of
the Agent and the Lenders under this Agreement, the Notes, the IRB Documents or
any of the other Loan Documents by suit in equity, action at law or other
appropriate proceeding, whether for the specific performance of any covenant or
agreement contained in this Agreement and the other Loan Documents or any
instrument pursuant to which the Obligations are evidenced, including to the
full extent permitted by applicable law the obtaining of the ex parte
appointment of a receiver and, if any amount shall have become due, by
declaration or otherwise, to proceed to enforce the payment thereof or any other
legal or equitable right of such
Lender. No remedy herein conferred upon any Lender or the Agent or the holder of
any Note is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or any
other provision of law.
(S)12.4. Distribution of Collateral Proceeds. In the event that, following
the occurrence or during the continuance of any Default or Event of Default, the
Agent or any Lender as the case may be, receives any monies in connection with
the enforcement of any of the Security Documents, or otherwise with respect to
the realization upon any of the Collateral, such monies shall be distributed for
application as follows:
(a) First, to the payment of, or (as the case may be) the
reimbursement of the Agent for or in respect of all reasonable costs, expenses,
disbursements and losses which shall have been incurred or sustained by the
Agent in connection with the collection of such monies by the Agent, for the
exercise, protection or enforcement by the Agent of all or any of the rights,
remedies, powers and privileges of the Agent or the Lenders under this Agreement
or any of the other Loan Documents or in respect of the Collateral or in support
of any provision of adequate indemnity to the Agent against any taxes or liens
which by law shall have, or may have, priority over the rights of the Agent to
such monies;
(b) Second, to all other Obligations in such order or preference as
the Requisite Lenders may determine; provided, however, that distribution in
respect of such Obligations shall be made among the Lenders pro rata in
accordance with each Lender's respective Commitment Percentage; and provided,
further, that the Agent may in its discretion make proper allowance to take into
account any Obligations not then due and payable;
(c) Third, upon payment and satisfaction in full or other provisions
for payment in full satisfactory to the Requisite Lenders and the Agent of all
of the Obligations, and the deposit in any cash collateral account established
pursuant to (S)2.9 (f) of the amount required thereby, to the payment of any
obligations required to be paid pursuant to (S)9-504(1)(c) of the Uniform
Commercial Code of the State of New York; and
(d) Fourth, the excess, if any, shall be returned to the Borrower or
to such other Persons as are legally entitled thereto.
(S)12.5. Addition of Real Estate Assets to Cure Default. As an alternative
to the payment of cash to cure a Default under (S)9.1 or (S)9.2 hereof, the
Borrower shall have the right to offer to provide additional Collateral to the
Agent in the form of Additional Properties pursuant to (S)5.3 and (S)5.4, for
the purpose of curing a Default under (S)9.1 or (S)9.2 hereof, if the Borrower
designates such Collateral for addition within fifteen (15) days after the
occurrence of such Default and the Borrower, the Company or the Mortgagor, as
applicable, executes and delivers to the Agent a Security Deed, an Assignment of
Leases and Rents, an Indemnity Agreement and UCC-1 Financing Statements relating
to the Additional Property together with the Certificates and opinion described
in (S)5.4(d) and (S)5.4(e) within thirty (30) days after the occurrence of such
Default. The Agent and the Lenders shall accept and approve the addition of such
Collateral as a cure for such Default if such Collateral shall cure the Default
and satisfies the due diligence
requirements of the Agent and the Requisite Lenders, including, without
limitation, the conditions set forth in (S)5.4 and those requirements with
respect to the Mortgaged Properties specified in (S)10 hereof, within ninety
(90) days after the occurrence of the subject Default, and at the time that such
due diligence requirements are so satisfied, no other Defaults or Events of
Default are continuing. If any such additional Collateral is provided to the
Agent in accordance with this (S)12.5, such additional Collateral shall, for all
purposes hereof, be deemed to be a "Mortgaged Property." Until the Agent and
Requisite Lenders have acknowledged in writing the cure of such Default (which
written acknowledgment will be given promptly after such cure has been completed
as herein provided), all consequences of such Default hereunder shall be
effective (except as provided in (S)8.7) and the Agent may exercise all
available remedies except that the maturity of the Loans shall not be
accelerated based solely on the Default which Borrower is diligently attempting
to cure hereunder, prior to the expiration of said ninety (90) day period.
(S)13. SETOFF. Regardless of the adequacy of any Collateral, during the
continuance of any Event of Default, any deposits (general or specific, time or
demand, provisional or final, regardless of currency, maturity, or the branch of
where such deposits are held) or other sums credited by or due from any of the
Lenders to the Borrower and any securities or other property of the Borrower in
the possession of such Lender may WITH THE PRIOR APPROVAL OF THE AGENT be
applied to or set off against the payment of Obligations and any and all other
liabilities, direct, or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, of the Borrower to such Lender. Each of the
Lenders agrees with each other Lender that (a) if an amount to be set off is to
be applied to Indebtedness of the Borrower to such Lender, other than
Indebtedness evidenced by the Notes held by such Lender, such amount shall be
applied ratably to such other Indebtedness and to the Indebtedness evidenced by
all such Notes held by such Lender, and (b) if such Lender shall receive from
the Borrower, whether by voluntary payment, exercise of the right of setoff,
counterclaim, cross action, enforcement of the claim evidenced by the Notes held
by such Lender by proceedings against the Borrower at law or in equity or by
proof thereof in bankruptcy, reorganization, liquidation, receivership or
similar proceedings, or otherwise, and shall retain and apply to the payment of
the Note or Notes held by such Lender any amount in excess of its ratable
portion of the payments received by all of the Lenders with respect to the Notes
held by all of the Lenders, such Lender will make such disposition and
arrangements with the other Lenders with respect to such excess, either by way
of distribution, pro tanto assignment of claims, subrogation or otherwise as
shall result in each Lender receiving in respect of the Notes held by it its
proportionate payment as contemplated by this Agreement; provided that if all or
any part of such excess payment is thereafter recovered from such Lender, such
disposition and arrangements shall be rescinded and the amount restored to the
extent of such recovery, but without interest. Notwithstanding the foregoing, no
Lender shall exercise a right of setoff if such exercise would limit or prevent
the exercise of any other remedy, right to Collateral or other recourse against
the Borrower.
(S)14. THE AGENT.
(S)14.1. Authorization. The Agent is authorized to take such action on
behalf of each of the Lenders and to exercise all such powers as are hereunder
and under any of the other Loan
Documents and any related documents delegated to the Agent, together with such
powers as are reasonably incident thereto, provided that no duties or
responsibilities not expressly assumed herein or therein shall be implied to
have been assumed by the Agent. The relationship between the Agent and the
Lenders is and shall be that of agent and principal only, and nothing contained
in this Agreement or any of the other Loan Documents shall be construed to
constitute the Agent as a trustee for any Lender.
(S)14.2. Employees and Agents. The Agent may exercise its powers and
execute its duties by or through employees or agents and shall be entitled to
take, and to rely on, advice of counsel concerning all matters pertaining to its
rights and duties under this Agreement and the other Loan Documents. The Agent
may utilize the services of such Persons as the Agent in its sole discretion may
reasonably determine, and all reasonable fees and expenses of any such Persons
shall be paid by the Borrower.
(S)14.3. No Liability. Neither the Agent nor any of its shareholders,
directors, officers or employees nor any other Person assisting them in their
duties nor any agent or employee thereof, shall be liable for any waiver,
consent or approval given or any action taken, or omitted to be taken, in good
faith by it or them hereunder or under any of the other Loan Documents, or in
connection herewith or therewith, or be responsible for the consequences of any
oversight or error of judgment whatsoever, except that the Agent or such other
Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence.
(S)14.4. No Representations. The Agent shall not be responsible for the
execution or validity or enforceability of this Agreement, the Notes, any of the
other Loan Documents or any instrument at any time constituting, or intended to
constitute, collateral security for the Notes, or for the value of any such
collateral security or for the validity, enforceability or collectability of any
such amounts owing with respect to the Notes, or for any recitals or statements,
warranties or representations made herein or in any of the other Loan Documents
or in any certificate or instrument hereafter furnished to it by or on behalf of
the Borrower, or be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or in
any instrument at any time constituting, or intended to constitute, collateral
security for the Notes. The Agent shall not be bound to ascertain whether any
notice, consent, waiver or request delivered to it by the Borrower or any holder
of any of the Notes shall have been duly authorized or is true, accurate and
complete. The Agent has not made nor does it now make any representations or
warranties, express or implied, nor does it assume any liability to the Lenders,
with respect to the credit worthiness or financial condition of the Borrower.
Each Lender acknowledges that it has, independently and without reliance upon
the Agent or any other Lender, and based upon such information and documents as
it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement. Each Lender has been independently represented by separate
counsel regarding this Agreement.
(S)14.5. Payments.
(a) A payment by the Borrower to the Agent hereunder or any of the
other Loan Documents for the account of any Lender shall constitute a payment to
such Lender subject to
the pro rata rights to repayment based upon the Commitment Percentage of each
Lender. The Agent agrees promptly to distribute to each Lender such Lender's
pro rata share of payments received by the Agent for the account of the Lenders
except as otherwise expressly provided herein or in any of the other Loan
Documents.
(b) If in the opinion of the Agent the distribution of any amount
received by it in such capacity hereunder, under the Notes or under any of the
other Loan Documents might involve it in liability, it may refrain from making
distribution until its right to make distribution shall have been adjudicated by
a court of competent jurisdiction. If a court of competent jurisdiction shall
adjudge that any amount received and distributed by the Agent is to be repaid,
each Person to whom any such distribution shall have been made shall either
repay to the Agent its proportionate share of the amount so adjudged to be
repaid or shall pay over the same in such manner and to such Persons as shall be
determined by such court.
(c) Notwithstanding anything to the contrary contained in this
Agreement or any of the other Loan Documents, any Lender that fails (i) to make
available to the Agent its pro rata share of any Loan or of any Unreimbursed
Drawing or (ii) to comply with the provisions of (S)12.4 or (S)13 with respect
to making dispositions and arrangements with the other Lenders, where such
Lender's share of any payment received, whether by setoff or otherwise, is in
excess of its pro rata share of such payments due and payable to all of the
Lenders, in each case as, when and to the full extent required by the provisions
of this Agreement, or to adjust promptly such Lender's outstanding principal and
its pro rata Commitment Percentage as provided in (S)2.1 hereof, shall be deemed
delinquent (a "Delinquent Lender") and shall be deemed a Delinquent Lender
until such time as such delinquency is satisfied. A Delinquent Lender shall be
deemed to have assigned any and all payments due to it from the Borrower,
whether on account of outstanding Loans, interest, fees or otherwise, to the
remaining nondelinquent Lenders for application to, and reduction of, their
respective pro rata shares of all outstanding Loans. The Delinquent Lender
hereby authorizes the Agent to distribute such payments to the nondelinquent
Lenders in proportion to their respective pro rata shares of all outstanding
Loans. A Delinquent Lender shall be deemed to have satisfied in full a
delinquency when and if, as a result of application of the assigned payments to
all outstanding Loans of the nondelinquent Lenders, the Lenders' respective pro
rata shares of all outstanding Loans have returned to those in effect
immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency.
(S)14.6. Holders of Notes. The Agent may deem and treat the payee of any
Note as the absolute owner or purchaser thereof for all purposes hereof until it
shall have been furnished in writing with a different name by such payee or by a
subsequent holder assignee or transferee.
(S)14.7. Indemnity. The Lenders ratably agree hereby to indemnify and hold
harmless the Agent from and against any and all claims, actions and suits
(whether groundless or otherwise), losses, damages, costs, expenses (including
any expenses for which the Agent has not been reimbursed by the Borrower as
required by (S)15), and liabilities of every nature and character arising out of
or related to this Agreement, the Notes, or any of the other Loan Documents or
the transactions contemplated or evidenced hereby or thereby, or the Agent's
actions taken hereunder
or thereunder, except to the extent that any of the same shall be directly
caused by the Agent's willful misconduct or gross negligence.
(S)14.8. Agent as Lender. In its individual capacity, BankBoston shall
have the same obligations and the same rights, powers and privileges in respect
to its Commitment and the Loans made by it, and as the holder of any of the
Notes as it would have were it not also the Agent. By issuing the Letters of
Credit in its individual capacity BankBoston is bound to perform its duties and
obligations under such Letters of Credit as provided therein. BankBoston's
status as Agent hereunder shall not limit or restrict its ability to perform
such duties and obligations.
(S)14.9. Resignation. The Agent may resign at any time by giving sixty
(60) days, prior written notice thereof to the Lenders and the Borrower. Upon
any such resignation, the Requisite Lenders shall have the right to appoint a
successor Agent. Unless a Default or Event of Default shall have occurred and be
continuing, appointment of such successor Agent shall be subject to the
reasonable approval of the Borrower. If no successor Agent shall have been so
appointed by the Requisite Lenders and shall have accepted such appointment
within thirty (30) days after the giving of notice of resignation or removal, or
the Borrower has disapproved or failed to approve a successor agent within such
period, then the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent, which shall be a financial institution having a rating of not
less than A2/P2 or its equivalent by Standard & Poor's Corporation. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations as Agent hereunder.
After any retiring Agent's resignation, the provisions of this Agreement and the
other Loan Documents shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as Agent.
(S)14.10. Notification of Defaults and Events of Default. Each Lender
hereby agrees that, upon learning of the existence of a Default or an Event of
Default, it shall promptly notify the Agent thereof. The Agent hereby agrees
that upon receipt of any notice under this (S)14.10 it shall promptly notify the
other Lenders of the existence of such Default or Event of Default.
(S)14.11. Duties in the Case of Enforcement. In case one of more Events of
Default have occurred and shall be continuing, and whether or not acceleration
of the Obligations shall have occurred, the Agent shall, if (a) so requested by
the Requisite Lenders and (b) the Lenders have provided to the Agent such
additional indemnities and assurances against expenses and liabilities as the
Agent may reasonably request, proceed to enforce the provisions of the Security
Documents authorizing the sale or other disposition of all or any part of the
Collateral and exercise all or any such other legal and equitable and other
rights or remedies as it may have in respect of such Collateral. The Requisite
Lenders may direct the Agent in writing as to the method and the extent of any
such sale or other disposition, the Lenders hereby agreeing to indemnify and
hold the Agent harmless from all liabilities incurred in respect of all actions
taken or omitted in accordance with such directions, provided that the Agent
need not comply with any such direction to the extent that the Agent reasonably
believes the Agent's compliance with such
direction to be unlawful or commercially unreasonable in any applicable
jurisdiction. The Agent may take such steps as it reasonably determines for the
taking of possession or title to any Collateral, including the formation of
trusts or corporations with each Lender having a beneficial interest equal to
its pro rata percentage of the outstanding Loans.
(S)14.12. Mandatory Resignation of Agent. In the event that the Agent
enters into one or more Assignments pursuant to (S)18 having the effect of
reducing the Agent's Commitment to less than $25,000,000 (which number will be
reduced in proportion to any reduction in the Total Commitment pursuant to
(S)2.2) then the Agent shall promptly so notify the Borrower and the Lenders.
Upon the written request of the Borrower or any Lender whose Commitment exceeds
that of the Agent, which written request is made within thirty (30) days after
the Agent's notice that its Commitment is below such minimum level, the Agent
shall be obligated to resign pursuant to (S)14.9.
(S)15. EXPENSES. The Borrower agrees to pay (a) the reasonable costs of
producing and reproducing this Agreement, the other Loan Documents and the other
agreements and instruments mentioned herein, (b) any taxes (including any
interest and penalties in respect thereto) payable by the Agent or any of the
Lenders (other than taxes based upon the Agent's or any Lender 's net income),
including any recording, mortgage, documentary or intangibles taxes in
connection with the Security Documents and other Loan Documents, or other taxes
payable on or with respect to the transactions contemplated by this Agreement,
including any such taxes payable by the Agent or any of the Lenders after the
Facility Closing Date (the Borrower hereby agreeing to indemnify the Lenders
with respect thereto), (c) all title insurance premiums, appraisal fees,
engineer's, inspector's and surveyor's fees, recording costs and the reasonable
fees, expenses and disbursements of the Agent's counsel or any local counsel to
the Agent incurred in connection with the preparation, administration or
interpretation of the Loan Documents and other instruments mentioned herein,
each closing hereunder, and amendments, modifications, approvals, consents or
waivers hereto or hereunder, (d) the reasonable fees, costs, expenses and
disbursements of the Agent incurred in connection with the preparation,
administration or interpretation of the Loan Documents and other instruments
mentioned herein including without limitation, the reasonable costs incurred by
the Agent in connection with its inspection of the Mortgaged Properties, and the
fees and disbursements of the Agent's counsel and the Borrower's legal counsel
in preparing documentation, (e) the reasonable fees, costs, expenses and
disbursements of the Agent incurred in connection with the syndication and/or
participation of the Loans, (f) all reasonable out-of-pocket expenses (including
reasonable attorneys' fees and costs, which attorneys may be employees of any
Lender or the Agent and the fees and costs of appraisers, engineers, investment
bankers, surveyors or other experts retained by the Agent or any Lender in
connection with any such enforcement proceedings) incurred by any Lender or
the Agent in connection with (i) the enforcement of or preservation of rights
under any of the Loan Documents against the Borrower or the administration
thereof after the occurrence of a Default or Event of Default (including,
without limitation, expenses incurred in any restructuring and/or "workout" of
the Loans), and (ii) any litigation, proceeding or dispute whether arising
hereunder or otherwise, in any way related to the Agent's or the Lender 's
relationship with the Borrower, the Company, any Permitted Joint Venture or any
of the Related Companies, (g) all reasonable fees, expenses and disbursements of
the Agent incurred in connection with UCC
searches, UCC filings or mortgage recordings, (h) all reasonable costs incurred
by the Agent in the future in connection with its inspection of the Mortgaged
Properties (which inspections shall occur not more frequently than annually
prior to an Event of Default), and (i) the reasonable fees, costs, expenses and
disbursements of the Agent incurred in connection with the granting of
additional Collateral by the Borrower pursuant to (S)12.5 hereof, including,
without limitation, the costs incurred by the Agent in connection with its
inspection of such additional Collateral, and the fees and disbursements of the
Agent's counsel. The covenants of this (S)15 shall survive payment or
satisfaction of payment of amounts owing with respect to the Notes.
(S)16. INDEMNIFICATION. Each of the Borrower and the Company, jointly
and severally, agrees to indemnify and hold harmless the Agent and the Lenders
and the shareholders, directors, agents, officers, subsidiaries, and affiliates
of the Agent and the Lenders from and against any and all claims, actions or
causes of action and suits whether groundless or otherwise, and from and against
any and all liabilities, losses, settlement payments, obligations, damages and
expenses of every nature and character arising out of this Agreement or any of
the other Loan Documents or the Formation Transactions or any other transactions
contemplated hereby or which otherwise arise in connection with the financing
including, without limitation unless directly caused by the gross negligence or
willful misconduct of a Lender or the Agent (but such limitation on
indemnification shall only apply to the Agent or Lender being grossly negligent
or committing willful misconduct), (a) any actual or proposed use by the
Borrower of the proceeds of any of the Loans or the Drawings of any Letters of
Credit, (b) any actual or alleged infringement of any patent, copyright,
trademark, service xxxx or similar right of the Borrower comprised in the
Collateral, (c) the Borrower, the Company or any Guarantor entering into or
performing this Agreement or any of the other Loan Documents or (d) any cost,
claim liability, damage or expense in connection with any harm the Borrower may
be found to have caused in the role of a broker, in each case including, without
limitation, the reasonable fees and disbursements of counsel and allocated costs
of internal counsel incurred in connection with any such investigation,
litigation or other proceeding. In litigation, or the preparation therefor, the
Lenders and the Agent shall each be entitled to select their own separate
counsel to the extent that their representation by the same counsel would
present such counsel with a conflict of interest, or would be inappropriate due
to actual or potential differing interests or because there may be defenses
available to certain of such persons that are different from or in addition to
those available to the other persons to be represented by such counsel and, in
addition to the foregoing indemnity, the Borrower agrees to pay promptly the
reasonable fees and expenses of such counsel. In the event that Agent or any
Lender is made a party to any litigation against the Company or the Borrower
relating to or arising from the Formation Transactions, the Borrower or the
Company may, or if requested by the Agent or the Requisite Lenders shall, assume
primary responsibility for the defense thereof with counsel reasonably
satisfactory to the Requisite Lenders, subject to the right of the Agent and the
Lenders to separate counsel to the extent provided in the preceding sentence.
If, and to the extent that the obligations of the Borrower or the Company under
this (S)16 are unenforceable for any reason, the Borrower and the Company hereby
agree to make the maximum contribution to the payment in satisfaction of such
obligations which is permissible under applicable law. The provisions of this
(S)16 shall survive the repayment of the Loans and the termination of the
obligations of the Lenders hereunder and shall continue in full force and effect
as to the Lenders so long as the possibility of any such
claim, action, cause of action or suit exists.
(S)17. SURVIVAL OF COVENANTS, ETC. All covenants, agreements,
representations and warranties made herein, in the Notes, in any of the other
Loan Documents or in any documents or other papers delivered by or on behalf of
the Borrower or any Guarantor pursuant hereto shall be deemed to have been
relied upon by the Lenders and the Agent, notwithstanding any investigation
heretofore or hereafter made by it, and shall survive the making by the Lenders
of the Loans, as herein contemplated, and shall continue in full force and
effect so long as any amount due under this Agreement or the Notes or any of the
other Loan Documents remains outstanding or the Lenders have any obligation to
make any Loans. The indemnification obligations of the Borrower provided herein
and the other Loan Documents shall survive the full repayment of amounts due and
the termination of the obligations of the Lenders hereunder and thereunder to
the extent provided herein and therein. All statements contained in any
certificate or other paper delivered to the Agent or any Lender at any time by
or on behalf of the Borrower pursuant hereto or in connection with the
transactions contemplated hereby shall constitute representations and warranties
by the Borrower hereunder.
(S)18. ASSIGNMENT; PARTICIPATIONS; ETC.
(S)18.1. Conditions to Assignment by Lenders. Except as provided herein,
each Lender may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Agreement (including all or a
portion of its Commitment Percentage and Commitment and the same portion of the
Loans at the time owing to it, and the Notes held by it); provided that (a) the
Agent shall have given its prior written consent to such assignment except that
such consent shall not be needed with respect to an assignment from a Lender to
one of its Affiliated Lenders or to another Lender, (b) each such assignment
shall be of a constant, and not a varying, percentage of all the assigning
Lender 's rights and obligations under this Agreement, (c) each assignment shall
be in an amount of not less than $10,000,000 that is a whole multiple of
$1,000,000, (d) each Lender either shall assign all of its Commitment and cease
to be a Lender hereunder or shall retain, free of any such assignment, an amount
of its Commitment of not less than $10,000,000 and (e) the parties to such
assignment shall execute and deliver to the Agent, for recording in the Register
(as hereinafter defined), an Assignment and Acceptance,
substantially in the form of Exhibit F hereto (an "Assignment and Acceptance"),
together with any Notes subject to such assignment. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least five
(5) Business Days after the execution thereof, (i) the assignee thereunder shall
be a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder, and (ii) the assigning
Lender shall, to the extent provided in such assignment and upon payment to the
Agent of the registration fee referred to in (S)18.3, be released from its
obligations under this Agreement.
(S)18.2. Certain Representations and Warranties; Limitations; Covenants.
By executing and delivering an Assignment and Acceptance, the parties to the
assignment thereunder confirm to and agree with each other and the other parties
hereto as follows: (a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned
thereby free and clear of any adverse claim, the assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, the other Loan Documents or any other
instrument or document furnished pursuant hereto; (b) the assigning Lender makes
no representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or any other Person primarily or secondarily
liable in respect of any of the Obligations, or the performance or observance by
the Borrower or any other Person primarily or secondarily liable in respect of
any of the Obligations of any of their obligations under this Agreement or any
of the other Loan Documents or any other instrument or document furnished
pursuant hereto or thereto or the validity or enforceability or priority of any
lien or any Collateral; (c) such assignee confirms that it has received a copy
of this Agreement, together with copies of the most recent financial statements
referred to in (S)6.4 and (S)7.4 and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (d) such assignee will, independently and
without reliance upon the assigning Lender, the 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 decisions and Collateral decisions in
taking or not taking action under this Agreement, (e) such assignee represents
and warrants that it is an Eligible Assignee; (f) such assignee appoints and
authorizes the Agent to take such action as "Agent" on its behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
delegated to the Agent by the terms hereof or thereof, together with such powers
as are reasonably incidental thereto; (g) such assignee agrees that it will
perform in accordance with their terms all of the obligations that by the terms
of this Agreement are required to be performed by it as a Lender ; and (h) such
assignee represents and warrants that it is legally authorized to enter into
such Assignment and Acceptance. Each of the Syndication Lenders shall be subject
to the provisions of this (S)18.2 to the same extent as though it were becoming
a party to this Agreement as an assignee by entering into an Assignment and
Acceptance with each Lead Lender effective on the Effective Date.
(S)18.3. Register. The Agent shall maintain a copy of each Assignment
and Acceptance delivered to it and a register or similar list (the "Register")
for the recordation of the names and addresses of the Lenders and the Commitment
Percentages of, and principal amount of the Loans owing to the Lenders from time
to time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower and the Lenders at any reasonable time and from time to time upon
reasonable prior notice. Upon each such recordation, the assigning Lender agrees
to pay to the Agent a registration fee in the sum of $2,500.00. The Agent may
amend Schedules 1 and 1.2 hereof to reflect the recording of any such
assignments.
(S)18.4. New Notes. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (a) record the information contained therein in
the Register, and (b) give prompt notice thereof to
the Borrower and the Lenders (other than the assigning Lender). Within five (5)
Business Days after receipt of such notice, the Borrower, at its own expense,
shall execute and deliver to the Agent, in exchange for each surrendered Note, a
new Note to the order of such Eligible Assignee in an amount equal to the amount
assumed by such Eligible Assignee pursuant to such Assignment and Acceptance
and, if the assigning Lender has retained some portion of its Loans hereunder, a
new Note to the order of the assigning Lender in an amount equal to the amount
retained by it hereunder. Such new Notes shall provide that they are
replacements for the surrendered Notes and that they do not constitute a
novation, shall be in an aggregate principal amount equal to the aggregate
principal amount of the surrendered Notes, shall be dated the effective date of
such Assignment and Acceptance and shall otherwise be in substantially the form
of the assigned Notes. Within five (5) days of issuance of any new Notes
pursuant to this (S)18.4, the Borrower shall deliver an opinion of counsel,
addressed to the Lenders and the Agent, relating to the due authorization,
execution and delivery of such new Notes and the legality, validity and binding
effect thereof, and that the Obligations evidenced by the new Notes are secured
by the Collateral with the same validity, enforceability and priority as if
given on the Effective Date, in form and substance satisfactory to the Lenders.
The surrendered Notes shall be cancelled and returned to the Borrower.
(S)18.5. Participations. Each Lender may sell participations to one or
more banks or other entities in a portion of such Lender's rights and
obligations under this Agreement and the other Loan Documents not to exceed
forty-nine percent (49%) of its Commitment Percentage; provided that (a) the
Agent shall have given its prior written consent to such participation which
consent shall not be unreasonably withheld if the participant is an Eligible
Assignee, except that any Lender may sell participations to its Affiliated
Lenders without such consent, (b) each such participation shall be in an amount
of not less than $10,000,000 that is a whole multiple of $1,000,000, (c) any
such sale or participation shall not affect the rights and duties of the selling
Lender hereunder to the Borrower and the Lender shall continue to exercise all
approvals, disapprovals and other functions of a Lender, (d) the only rights
granted to the participant pursuant to such participation arrangements with
respect to waivers, amendments or modifications of the Loan Documents shall be
the rights to approve the vote of the Lender as to waivers, amendments or
modifications that would reduce the principal of or the interest rate on any
Loans, extend the term or increase the amount of the Commitment of such Lender
as it relates to such participant, reduce the amount of any fees to which such
participant is entitled or extend any regularly scheduled payment date for
principal or interest, provided that all approvals affecting a Loan or this
Agreement under this clause (d) shall be granted or withheld by each Lender
voting its entire Commitment Percentage as a whole, and (e) no participant shall
have the right to grant further participations or assign its rights, obligations
or interests under such participation to other Persons without the prior written
consent of the Agent. The Agent shall promptly advise the Borrower in writing of
any such sale or participation.
(S)18.6. Pledge by Lender. Any Lender may at any time pledge all or any
portion of its interest and rights under this Agreement (including all or any
portion of its Note) to any of the twelve Federal Reserve Lenders organized
under (S)4 of the Federal Reserve Act, 12 U.S.C. (S)341. No such pledge or the
enforcement thereof shall release the pledgor Lender from its obligations
hereunder or under any of the other Loan Documents.
(S)18.7. No Assignment by Borrower. The Borrower shall not assign or
transfer any of its rights or obligations under any of the Loan Documents
without the prior written consent of each of the Lenders.
(S)18.8. Disclosure. The Borrower agrees that in addition to disclosures
made in accordance with standard banking practices any Lender may disclose
information obtained by such Lender pursuant to this Agreement to assignees or
participants and potential assignees or participants hereunder. Such Lender
shall obtain from each party to whom it discloses such information, the
agreement by such party to comply with the Lenders' agreements with respect to
Confidential Information set forth in (S)7.9.
(S)19. NOTICES, ETC. Except as otherwise expressly provided in this
Agreement, all notices and other communications made or required to be given
pursuant to this Agreement or the Notes shall be in writing and shall be
delivered in hand, mailed by United States registered or certified first class
mail, postage prepaid, sent by overnight courier, or sent by telegraph,
telecopy, telefax or telex and confirmed by delivery via courier or postal
service, addressed as follows:
(a) if to the Borrower, at 00 Xxxx Xxxxxx Xxxxx, Xxxxx 0000,
Xxxxxxx, XX 00000, Attention: Chief Financial Officer or at such other address
for notice as the Borrower shall last have furnished in writing to the Agent;
and
(b) if to the Agent, at 000 Xxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, Attention: Real Estate Department, and to 000 Xxxxxxxxx
Xxxxxx Xxxxx, X.X., Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, Attn: Xxxx X. Xxxxx, Vice
President, or such other address for notice as the Agent shall last have
furnished in writing to the Borrower.
(c) if to any Lender, at such Lender's address set forth on
Schedule 1, hereto, or such other address for notice as such Lender shall have
last furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or made
and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile and
(ii) if sent by registered or certified first-class mail, postage prepaid, on
the third Business Day following the mailing thereof.
(S)20. GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE. THIS
AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS, EXCEPT AS OTHERWISE SPECIFICALLY
PROVIDED THEREIN, ARE CONTRACTS UNDER THE LAWS OF THE STATE OF NEW YORK AND
SHALL FOR ALL PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF SUCH STATE (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE
BORROWER AGREES THAT ANY SUIT BY IT FOR THE ENFORCEMENT OF THIS
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE
COMMONWEALTH OF MASSACHUSETTS OR THE STATE OF NEW YORK OR ANY FEDERAL COURT
SITTING THEREIN AND BORROWER CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH
COURT FOR ANY SUIT BY AGENT OR ANY LENDER AND THE SERVICE OF PROCESS IN ANY SUCH
SUIT BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN (S)19. THE
BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN
INCONVENIENT COURT. IN ADDITION TO THE COURTS OF MASSACHUSETTS AND NEW YORK OR
ANY FEDERAL COURT SITTING THEREIN, THE AGENT OR ANY LENDER MAY BRING ACTION(S)
FOR ENFORCEMENT ON A NONEXCLUSIVE BASIS WHERE ANY COLLATERAL EXISTS AND THE
BORROWER CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF SUCH COURT AND THE
SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER BY MAIL AT THE
ADDRESS SPECIFIED IN (S)19.
(S)21. HEADINGS. The captions in this Agreement are for convenience of
reference only and shall not define or limit the provisions hereof.
(S)22. COUNTERPARTS. This Agreement and any amendment hereof may be
executed in several counterparts and by each party on a separate counterpart,
each of which when so executed and delivered shall be an original, and all of
which together shall constitute one instrument. In proving this Agreement it
shall not be necessary to produce or account for more than one such counterpart
signed by the party against whom enforcement is sought.
(S)23. ENTIRE AGREEMENT. The Loan Documents and any other documents
executed in connection herewith or therewith express the entire understanding of
the parties with respect to the transactions contemplated hereby. Neither this
Agreement nor any term hereof may be changed, waived, discharged or terminated,
except as provided in (S)25.
(S)24. WAIVER OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS. THE BORROWER
HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM
ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, THE NOTES OR ANY
OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER
OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS. EXCEPT TO THE EXTENT
EXPRESSLY PROHIBITED BY LAW, THE BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO
CLAIM OR RECOVER IN ANY LITIGATION REFERRED TO IN THE PRECEDING SENTENCE ANY
SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN,
OR IN ADDITION TO, ACTUAL DAMAGES. THE BORROWER (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF THE AGENT OR ANY LENDER HAD REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT THE AGENT OR SUCH LENDER WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS AND (B) ACKNOWLEDGES THAT THE
AGENT AND THE LENDERS HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH
THEY ARE PARTIES BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS
CONTAINED HEREIN.
(S)25. CONSENTS, AMENDMENTS, WAIVERS, ETC. Any consent or approval
required or permitted by this Agreement may be given, and any term of this
Agreement or of any other instrument related hereto or mentioned herein may be
amended, and the performance or observance by the Borrower of any terms of this
Agreement or such other instrument or the continuance of any Default or Event of
Default may be waived (either generally or in a particular instance and either
retroactively or prospectively) with, but only with, the written consent of the
Requisite Lenders, and, in the case of amendments, with the written consent of
the Borrower other than amendments to schedules made in the ordinary course as
contemplated by this Agreement. Notwithstanding the foregoing, (i) the rate of
interest on and the term or amount of the Notes, (ii) the amount of the
Commitments of the Lenders, (iii) the amount of any fee payable to a Lender
hereunder, (iv) any provision herein or in any of the Loan Documents which
expressly requires consent of all the Lenders, (v) the funding provisions of
(S)2.4 and (S)2.5 hereof, (vi) the rights, duties and obligations of the Agent
specified in (S)14 hereof, (vii) the date or time fixed for payment of principal
or interest, (viii) any change or release having the effect of converting the
credit facility hereunder from a secured facility to an unsecured facility and
(ix) this (S)25 may not be amended without the written consent of each Lender
affected thereby, nor may the Agent release any obligor from its liability with
respect to the Obligations, without first obtaining the written consent of all
the Lenders. No waiver shall extend to or affect any obligation not expressly
waived or impair any right consequent thereon. No course of dealing or delay or
omission on the part of the Agent or any Lender in exercising any right shall
operate as a waiver thereof or otherwise be prejudicial thereto. No notice to or
demand upon the Borrower shall entitle the Borrower to other or further notice
or demand in similar or other circumstances.
(S)26. SEVERABILITY. The provisions of this Agreement are severable, and
if any one clause or provision hereof shall be held invalid or unenforceable in
whole or in part in any jurisdiction, then such invalidity or unenforceability
shall affect only such clause or provision, or part thereof, in such
jurisdiction, and shall not in any manner affect such clause or provision in any
other jurisdiction, or any other clause or provision of this Agreement in any
jurisdiction.
(S)27. ACKNOWLEDGMENTS. The Borrower hereby acknowledges that: (i)
neither the Agent nor any Lender has any fiduciary relationship with, or
fiduciary duty to, the Borrower arising out of or in connection with this
Agreement or any of the other Loan Documents; (ii) the relationship in
connection herewith between the Agent and the Lenders, on the one hand, and the
Borrower, on the other hand, is solely that of debtor and creditor and (iii) no
joint venture or partnership among any of the parties hereto is created hereby
or by the other Loan Documents, or otherwise exists by virtue of the Facility or
the Loans.
(S)28. PARTNER LIABILITY.
(S)28.1. Limited Recourse to Company. Notwithstanding anything expressed
or implied to the contrary contained herein, the Company shall not be liable
hereunder or under any
Guaranty or under any legal or equitable proceeding or by virtue of any statute,
regulation or other applicable law for (i) any payment of principal or interest
on, or any other amounts due under, any of the Loans, or (ii) any reimbursement
obligation with respect to a Drawing under a Letter of Credit, or (iii) to repay
any other indebtedness of Borrower or any Guarantor, provided, however, that
nothing herein shall be construed to prevent the Agent or any Lender from
recovering from the Company, or limit the Agent's or any Lender's recourse
against the Company for any losses, damages or costs (including, without
limitation, reasonable legal expenses), incurred by the Agent or any Lender in
connection with the Company's breach of the Company's own covenants and
agreements herein or in the Indemnity Agreement, or in connection with the
Company's fraud, misappropriation of funds (whether due to the Company's failure
to contribute Net Offering Proceeds to the Borrower, as required by (S)7.20, or
its receipt of Distributions from the Borrower in violation of (S) 8.7, or
otherwise) or any misrepresentation made by or on behalf of the Company
hereunder or in connection with the transactions contemplated hereby.
(S)28.2. Limited Recourse to Partners of Borrower other than the Company.
With respect to all partners of the Borrower other than the Company, no personal
deficiency judgment or any other judgment shall be asserted or enforced against
any such partner for payment of any amount hereunder or for observance or
performance of any of the obligations of the Borrower contained herein, except
as expressly set forth in this agreement or any other agreement or instrument or
document as an obligation of such partner in connection herewith, and provided
that the foregoing shall not affect the liability which any of such other
partners may have for any fraud, misappropriation of funds or intentional
misrepresentation made hereunder by or on behalf of the Borrower or in
connection with the transactions contemplated hereby.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as a
sealed instrument as of the date first set forth above.
WITNESS: PRIME GROUP REALTY TRUST
/s/ Xxxxx Xxxx By: /s/ Xxxxxxx X. Xxxxxx
------------------------------- -----------------------------------
Xxxxxxx X. Xxxxxx
Its: Executive Vice President and
Chief Financial Officer
PRIME GROUP REALTY, L.P.
By: PRIME GROUP REALTY TRUST,
its managing general partner
/s/ Xxxxx Xxxx By: /s/ Xxxxxxx X. Xxxxxx
------------------------------- -----------------------------------
Xxxxxxx X. Xxxxxx
Its: Executive Vice President and
Chief Financial Officer
BANKBOSTON, N.A., as Agent
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxx
------------------------------- -----------------------------------
Xxxxx X. Xxxx
Its: Director
WITNESS: BANKBOSTON, N.A.
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxx
-------------------------- ------------------
Xxxxx X. Xxxx
Its Director
Commitment: $62,500,000
Temporary Commitment: $5,000,000
Commitment Percentage prior to Commitment Decrease Date: 33.75%
Commitment Percentage after Commitment Decrease Date: 32.89474%
Notice Address: BankBoston, N.A.
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Real Estate Department
With a copy to:
BankBoston, N.A.
000 Xxxxxxxxx Xxxxxx Xxxxx, X.X.
Xxxxx 000
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx, Vice President
Fax: (000)000-0000 or 000-0000
WITNESS: PRUDENTIAL SECURITIES
CREDIT CORPORATION
By: /s/ Xxxx X. Xxxxxx
--------------------------- ----------------------
Commitment: $62,500,000
Temporary Commitment: $5,000,000
Commitment Percentage prior to Commitment Decrease Date: 33.75%
Commitment Percentage after Commitment Decrease Date: 32.89474%
Notice Address:
Prudential Securities Credit Corporation
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000.
Attn: Xxxxxx X'Xxxxxx, Director
Phone: (000)000-0000
Fax: (000)000-0000 or 2253
WITNESS: SOCIETE GENERALE
/s/ Xxxx [illegible] By: /s/ M. Xxxxx Xxxxxxx
----------------------------- ----------------------------
Commitment: $25,000,000
Commitment Percentage prior to Commitment Decrease Date: 12.5%
Commitment Percentage after Commitment Decrease Date: 13.1579%
Notice Address:
Societe Generale
Xxxxxxx Xxxx Center
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attn: Xxxxxx Xxxxx
Phone: (000)000-0000
WITNESS: COMMERZBANK AG
-------------------------- By: /s/ J. Xxxxxxx Shortly /s/ Xxxx Xxxxxx
-------------------------- ------------------------
J. Xxxxxxx Shortly Xxxx Xxxxxx
Senior Vice President Assistant Vice President
Commitment: $20,000,000
Commitment Percentage prior to Commitment Decrease Date: 10%
Commitment Percentage after Commitment Decrease Date: 10.52631%
Notice Address:
Commerzbank AG
000 Xxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: J. Xxxxxxx Shortly
Phone: (000)000-0000
Fax: (000)000-0000
WITNESS BANQUE NATIONALE DE PARIS
/s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxxxxx X. Xxxxx
----------------------------- -------------------------
Xxxxxxx X. Xxxxxxx Xxxxxxxxx X. Xxxxx
Vice President and Manager Senior Vice President and
Manager
Commitment: $20,000,000
Commitment Percentage prior to Commitment Decrease Date: 10%
Commitment Percentage after Commitment Decrease Date: 10.52631%
Notice Address:
Banque Nationale de Paris
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Phone: (000)000-0000
Fax: (000)000-0000
Exhibit A
---------
FORM OF NOTE
------------
No. ___ [Date]
[Amount]
FOR VALUE RECEIVED, the undersigned, Prime Group Realty, L.P., a Delaware
limited partnership (the "Borrower"), promises to pay to the order of [Name of
Lender] (hereinafter, together with its successors in title and assigns, called
the "Lender") at the head office of BankBoston, N.A., as Agent (the "Agent") at
000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, the principal sum of [Amount in
Words][Amount in Numbers] or, if less, the aggregate unpaid principal amount of
all Loans made by the Lender to the Borrower pursuant to the Credit Agreement
dated as of November 17, 1997 among the Lender, the Borrower, Prime Group Realty
Trust, the other lending institutions named therein and the Agent, as amended
from time to time (the "Credit Agreement"). Capitalized terms used herein and
not otherwise defined herein shall have the meanings assigned to them in the
Credit Agreement. Unless otherwise provided herein, the rules of interpretation
set forth in (S)1.2 of the Credit Agreement shall be applicable to this Note.
This Note replaces, in part, the Loan Notes previously issued to the Lead
Lenders under the Credit Agreement and does not constitute a novation.
The Borrower also promises to pay (a) principal from time to time at the
times provided in the Credit Agreement and (b) interest from the date hereof on
the principal amount from time to time unpaid at the rates and times set forth
in the Credit Agreement and in all cases in accordance with the terms of the
Credit Agreement. Late charges and other charges and default rate interest shall
be paid by Borrower in accordance with the terms of the Credit Agreement. The
entire outstanding principal amount of this Note, together with all accrued but
unpaid interest thereon, shall be due and payable in full on the Maturity Date.
The Lender may endorse the record relating to this Note with appropriate
notations evidencing advances and payments of principal hereunder as
contemplated by the Credit Agreement.
This Note is issued pursuant to, is entitled to the benefits of, and is
subject to the provisions of the Credit Agreement. The principal of this Note is
subject to prepayment in whole or in part in the manner and to the extent
specified in the Credit Agreement. This Note is secured by the Security
Documents. However, the principal of this Note, the interest accrued on this
Note and all other Obligations of the Borrower are full recourse obligations of
the Borrower, and all of its Real Estate Assets, the Collateral and its other
properties shall be available for the payment and performance of this Note, the
interest accrued on this Note, and all of such other Obligations. The liability
of the partners of the Borrower hereunder is limited as set forth in (S)28 of
the Credit Agreement.
In case an Event of Default shall occur and be continuing, the entire
unpaid principal amount of this Note and all of the unpaid interest accrued
thereon may become or be declared due and payable in the manner and with the
effect provided in the Credit Agreement.
The Borrower and all endorsers hereby waive presentment, demand, protest
and notice of any kind in connection with the delivery, acceptance, performance
and enforcement of this Note, and also hereby assent to extensions of time of
payment or forbearance or other indulgences without notice.
THIS NOTE AND THE OBLIGATIONS OF THE BORROWER HEREUNDER SHALL BE GOVERNED
BY AND INTERPRETED AND DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW).
IN WITNESS WHEREOF, the Borrower has caused this Note to be duly executed
in its name as an instrument under seal on the date first above written.
WITNESS: PRIME GROUP REALTY, L.P.
By: Prime Group Realty Trust,
its managing general partner
________________________________ By:__________________________________
Exhibit B
---------
LOAN REQUEST
------------
Prime Group Realty, L.P.
00 Xxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
[Date]
BankBoston, N.A., as Agent
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Ladies and Gentlemen:
Re: Loan Request under Credit Agreement
dated as of November 17, 1997 as amended
Pursuant to (S)2.5 of the Credit Agreement dated as of November 17, 1997,
as amended, among you, certain other Lenders and us (the "Credit Agreement"), we
hereby request that you make a Loan as follows:
(i) Principal amount requested: $________________________
(ii) Proposed Borrowing Date: ___________________________
(iii) Interest Period: ___________________________________
(iv) Type: _______________________________________________
(v) Purpose of Loan: __________________________________________________
This Loan Request is submitted pursuant to, and shall be governed by, and
subject to satisfaction of, the terms, conditions and provisions set forth in
(S)2.5 of the Credit Agreement.
The undersigned hereby further certifies to you that it is in compliance
with the covenants specified in (S)9 of the Credit Agreement, and will remain in
compliance with such covenants after the making of the requested Loan, as
evidenced by a Compliance Certificate in the form of Exhibit C to the Credit
Agreement of even date herewith delivered to you simultaneously with this Loan
Request.
We also understand that if you grant this request this request obligates us
to accept the requested Loan on such date. All terms defined in the Credit
Agreement and used herein without definition shall have the meanings set forth
in (S)1.1 of the Credit Agreement.
The undersigned hereby certifies to you, in accordance with the provisions
of (S)11.1 of the Credit Agreement, that the representations and warranties
contained in the Credit Agreement and in each document and instrument delivered
pursuant to or in connection therewith were true as of the date as of which they
were made, are also true at and as of the date hereof, and will also be true at
and as of the proposed Borrowing Date of the Loan requested hereby, in each case
except as otherwise permitted pursuant to the provisions of (S)11.1 of the
Credit Agreement, and no Default or Event of Default has occurred and is
continuing.
Very truly yours,
Prime Group Realty, L.P.
By: Prime Group Realty Trust,
Its managing general partner
By:_______________________________
_______________________________
Its:________________________
Exhibit C
---------
Prime Group Realty, L.P.
00 Xxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Compliance Certificate under
Credit Agreement dated as of November 17, 1997
The undersigned, a Responsible Officer of Prime Group Realty Trust, general
partner of Prime Group Realty, L.P. (the "Borrower"), hereby certifies on behalf
of the Borrower as of the date hereof the following:
1. No Defaults. I have read a copy of the Credit Agreement dated as of
November 17, 1997 as amended (the "Credit Agreement") among the Borrower,
BankBoston, N.A., the other lending institutions party thereto, and BankBoston,
N.A., as Agent. Terms used herein and not otherwise defined herein shall have
the meanings set forth in (S)1.1 of the Credit Agreement. No Default is
continuing in the performance or observance of any of the covenants, terms or
provisions of the Credit Agreement or any of the other Loan Documents. Without
limiting the foregoing, the Borrower has not taken any actions which are
prohibited by the negative covenants set forth in (S)8 of the Credit Agreement.
Attached hereto as Appendix I are all relevant calculations needed to determine
whether the Borrower is in compliance with (S)9, (S)8.3(e), (g) and (h) and
(S)8.7 of the Credit Agreement as of the end of the most recently completed
fiscal quarter (except that in the case of Compliance Certificates delivered
pursuant to (S)2.5, (S)2.9(b) (S)11.1, (S)5.5 or (S)8.4(b), the calculations
determining compliance with (S)9.1, (S)9.2 and (S)9.3 are based on a Pro Forma
Principal Amount (after giving effect to the proposed transaction) and is in
compliance with (S)8.7 of the Credit Agreement for the most recently completed
fiscal year.
2. No Material Changes, Etc. Except as disclosed on Appendix II hereto,
since the [date of most recent financial statements furnished to the Agent and
the Lenders], there have occurred no materially adverse changes in the financial
condition or business of the Borrower as shown on or reflected in the balance
sheet of the Borrower as at such date other than (a) changes in the ordinary
course of business that have not had any materially adverse effect either
individually or in the aggregate on the business or financial condition of the
Borrower and (b) changes resulting from the making of the Loans and the
transactions contemplated by the Credit Agreement.
3. No Materially Adverse Contracts, Etc. Neither the Borrower nor the
Company is subject to any charter, corporate, trust, partnership or other legal
restriction, or any judgment, decree, order, rule or regulation that has or is
expected, in the reasonable judgment of the Company's officers, in the future to
have a Materially Adverse Effect. Neither the Borrower nor the Company is a
party to any contract or agreement that has or is expected, in the reasonable
judgment of the Company's officers, to have a Materially Adverse Effect.
Prime Group Realty, L.P.
By: Prime Group Realty Trust,
Its managing general partner
By:_______________________________
_______________________________
Its:___________________________
Date:
Appendix I
----------
FINANCIAL COVENANT CALCULATIONS
-------------------------------
Note: Unless otherwise indicated all calculations are as of _________________ or
for the fiscal quarter ending on such date (the "Fiscal Quarter").
1. Appraisal Value [(S)9.1]
(a) Pro Forma Principal Amount $_____________
(b) Collateral Value of Mortgaged $_____________
Properties (see attached Schedule
of Collateral Values)
(c) 60% of line (b) $____________
(d) Collateral Value of Assigned Mortgaged $____________
Properties (see attached Schedule
of Collateral Values)
(e) 50% of line (d) $____________
(f) Sum of lines (c) and (e) $____________
COVENANT: (a) should be less than (f)
2. Minimum Debt Service Coverage [(S)9.2]
(a) Net Operating Income for all of the Mortgaged Properties: $_____________
(b) Pro Forma Debt Service Charges for Mortgaged
Properties based on three monthly payments of
mortgage style amortization of the Pro Forma
Principal Amount of $_______________ amortized
over 25 years at _______% per annum, being the
greater of the current average interest rate on the Loans
or 1.75% above the current ten year U.S. Treasury xxxx yield: $_____________
CALCULATIONS: (a)/(b) = _________ which is not less than 1.5
3. Total Liabilities to Total Adjusted Assets [(S)9.3]
(a) Total Liabilities: $_____________
(b) Cash and cash equivalents: $_____________
(c) EBITDA last quarter: $_____________
(d) EBITDA previous quarter: $_____________
(e) Annualized EBITDA [(c) + (d) times 2]: $_____________
(f) Line (e) divided by 0.0975: $_____________
(g) Total Adjusted Assets [(b) + (f)]: $_____________
CALCULATIONS: (a)/(g) = ____________ which is less than 55%
4. Minimum Tangible Net Worth [(S)9.4]
(a) Total Assets (GAAP assets plus depreciation
on Real Estate Assets) $_____________
(b) Total Liabilities (same as line 3(a)) $_____________
(c) Intangibles $_____________
(d) Tangible Net Worth [(a)-(b)-(c)] $_____________
(e) Net Offering Proceeds $_____________
(f) $350,000,000 plus .75 times (e) $_____________
COVENANT: Line (d) should exceed line (f)
5. Total Operating Cash Flow to Interest Expense [(S)9.5]
(a) EBITDA (same as line 3(c)) $_____________
(b) Gross leasable area of all Real Estate Assets _____________
(c) Reserve Amount ((b) times $0.25 divided by 4) $_____________
(d) Total Operating Cash Flow [(a) - (c)] $_____________
(e) Interest Expense (includes capitalized interest) $_____________
CALCULATIONS: (d)/(e) = _____ which is not less than 2.0
6. EBITDA to Fixed Charges [(S)9.6]
(a) EBITDA (same as line 3(c)) $_____________
(b) Interest Expense (same as line 5(e)) $_____________
(c) Principal installments and current maturities
not refinanced $_____________
(d) Preferred dividends and distributions $_____________
(e) Fixed Charges (sum of lines (b), (c), and (d)) $_____________
CALCULATIONS: (a)/(e) = ____________which is not less than 1.75
7. Permitted Investments [(S)8.3(e), (g) and (h)]
Attached hereto is a Schedule of all (a) Investments in
mortgages and notes receivable, (b) Permitted
Developments in process as of ________________
and (c) Investments in undeveloped land.
(a) Investments in mortgages and notes receivable
(excluding Mortgages the acquisition of which
has been expressly approved by the Requisite Lenders) $_____________
(b) Investments in Permitted Developments $_____________
(c) Total Adjusted Assets (same as line 3(g)) $_____________
(d) 20% of Total Adjusted Assets $_____________
(e) Investments in undeveloped land $_____________
(f) 10% of Total Adjusted Assets $_____________
COVENANT:
Line (a) should not exceed $25,000,000
Line (b) should not exceed line (d)
Line (e) should not exceed line (f)
8. Distributions [(S)8.7]
(a) Total Distributions during most recently ended $_____________
fiscal year
(b) Funds From Operations for said fiscal year $_____________
(c) Total Distributions during most recently ended
fiscal quarter $_____________
(d) Funds from Operations for fiscal quarter referenced
in (c) $_____________
(e) Total Distributions during the fiscal quarter preceding
the fiscal quarter referenced in (c) $_____________
(f) Funds from Operations during fiscal quarter referenced
in (e) $_____________
(g) Total Distributions during the fiscal quarter preceding
the fiscal quarter referenced in (e) $_____________
(h) Funds from Operations during fiscal quarter referenced
in (g) $_____________
CALCULATIONS: (a)/(b) = _____% which is less than 90%
(c)/(d) = _____%
(e)/(f) = _____%
(g)/(h) = _____%
At least one of the three percentages immediately above is less than 100%
SCHEDULE OF COLLATERAL VALUES
Borrowing
Mortgaged NOI NOI Reserve Cap Base Appraised Collateral
Property Last Q Previous Q Amount Rate Value Value Value
-------- ------ ---------- ------- ----- ----- ----- -----
Totals:
-------
SCHEDULE OF
PERMITTED INVESTMENTS
I. Mortgages:
---------
Location of Security Maker of Note Cost Outstanding Balance
-------------------- ------------------ -------------------
II. Developments:
------------
Scheduled
Project Location Size (sq. ft.) Total Project Cost Start Date Completion Date
--------------- -------------- ------------------ ---------- ---------------
III. Undeveloped Land:
----------------
Land Location Size (acres) Cost
------------- ------------ ----
APPENDIX II
-----------
MATERIAL CHANGES
----------------
Exhibit D
---------
LETTER OF CREDIT REQUEST
------------------------
Prime Group Realty, L.P.
00 Xxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
[Date]
BankBoston, N.A., as Agent
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Ladies and Gentlemen:
Re: Letter of Credit Request under Credit
Agreement dated as of November 17, 1997 as amended
Pursuant to (S)2.9 of the Credit Agreement dated as of November 17, 1997,
as amended, among you, Prime Group Realty Trust, certain other Lenders and us
(the "Credit Agreement"), we hereby request that you issue [extend or renew, if
applicable] a Letter of Credit as follows:
(i) Name and address of beneficiary:
(ii) Face amount: $____________________
(iii) Proposed Issuance Date: ________________________
Proposed Expiration Date: _______________________
(iv) Other terms and conditions as set forth in the proposed form of
Letter of Credit attached hereto.
(v) Purpose of Letter of Credit:
This Letter of Credit Request is submitted pursuant to, and shall be
governed by, and subject to satisfaction of, the terms, conditions and
provisions set forth in (S)2.9 of the Credit Agreement.
The undersigned hereby further certifies to you that it is in compliance
with the covenants specified in (S)9 of the Credit Agreement, and will remain in
compliance with such covenants after the Outstanding Principal Amount is
adjusted to include the face amount of the requested Letter of Credit, as
evidenced by a Compliance Certificate in the form of Exhibit C to the Credit
Agreement of even date herewith delivered to you simultaneously with this Letter
of Credit Request.
We also understand that if you grant this request this request obligates us
to accept the requested Letter of Credit [or extension or renewal thereof] and
pay the issuance fee [or the renewal fee] and Letter of Credit fee as required
by (S)2.9(c). All terms defined in the Credit Agreement and used herein without
definition shall have the meanings set forth in (S)1.1 of the Credit Agreement.
The undersigned hereby certifies to you, in accordance with the provisions
of (S)11.1 of the Credit Agreement, that the representations and warranties
contained in the Credit Agreement and in each document and instrument delivered
pursuant to or in connection therewith were true as of the date as of which they
were made, are also true at and as of the date hereof, and will also be true at
and as of the proposed issuance date of the Letter of Credit requested hereby,
in each case except as otherwise permitted pursuant to the provisions of (S)11.1
of the Credit Agreement, and no Default or Event of Default has occurred and is
continuing.
Very truly yours,
Prime Group Realty, L.P.
By: Prime Group Realty Trust,
Its general partner
By: _______________________________
_______________________________
Its:_____________________________
EXHIBIT F
---------
FORM OF
ASSIGNMENT AND ACCEPTANCE
Dated _____________
Reference is made to the Credit Agreement, dated as of November 17, 1997
(as amended and in effect from time to time, the "Agreement"), among Prime Group
Realty, L.P., a Delaware limited partnership (the "Borrower"), Prime Group
Realty Trust, a Maryland real estate investment trust (the "Company"),
BankBoston, N.A., the other Lenders and BankBoston, N.A. as agent (the "Agent")
for itself and the other Lenders. Capitalized terms used herein and not
otherwise defined shall have the meanings assigned to such terms in the
Agreement.
_______________________________________________________________________________
(the "Assignor") and __________________________________________________________
(the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, and the Assignee
hereby purchases and assumes from the Assignor, a portion of the Assignor's
rights and obligations under the Agreement which relates to $____________ of its
Commitment and a Commitment Percentage of __% of all Loans and Letters of Credit
as of the Effective Date (as hereinafter defined).
2. The Assignor (i) represents that as of the date hereof, its Commitment
(without giving effect to assignments thereof which have not yet become
effective) is $__________ and its Commitment Percentage with respect thereto is
____%, and the outstanding balance of its Loans (unreduced by any assignments
thereof which have not yet become effective) is $__________; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Agreement, the other Loan Documents or any other
instrument or document furnished pursuant thereto on the status or value of any
Collateral, other than that it is the legal and beneficial owner of the interest
being assigned by it hereunder and that such interest is free and clear of any
adverse claim; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower, the
Company or any of their Subsidiaries or any other person which may be primarily
or secondarily liable in respect
of any of the Obligations or any of their obligations under the Agreement or the
other Loan Documents or any other instrument or document delivered or executed
pursuant thereto; and (v) attaches the Note delivered to it under the Agreement
and requests that the Borrower exchange such Note for new Notes payable to each
of the Assignor and the Assignee as follows:
Notes Payable to Amount
the Order of: of Note
------------- -------
[Name of Assignor] [($_____)]
[Name of Assignee] [($_____)]
3. The Assignee (i) represents and warrants that it is legally authorized
to enter into this Assignment and Acceptance; (ii) confirms that it has received
a copy of the Agreement, together with copies of the most recent financial
statements delivered pursuant to (S)(S)6.4 and 7.4 thereof and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (iii) agrees
that it will, independently and without reliance upon the Assignor, any other
Lender or the Agent and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions and review
and analysis of the granting and perfecting of any purported liens and the
status and value of any Collateral in taking or not taking action under the
Agreement; (iv) confirms that it is an Eligible Assignee; (v) appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers as are reasonably incidental thereto pursuant to the terms of the
Agreement and the other Loan Documents; and (vi) agrees that it will perform all
the obligations which by the terms of the Agreement are required to be performed
by it as a Lender in accordance with the terms of the Agreement.
4. The effective date for this Assignment and Acceptance shall be
____________________________ (the "Effective Date"). Following the execution of
this Assignment and Acceptance, it will be delivered to the Agent for acceptance
and recording in the Register by the Agent. This Assignment and Acceptance may
be executed in several counterparts and by each party on a separate counterpart,
each of which when so executed and delivered shall be an original, and all of
which together shall constitute one instrument. In proving this Assignment and
Acceptance it shall not be necessary to produce or account for more than one
such counterpart signed by the party against whom enforcement is sought.
5. Upon such acceptance and recording, from and after the Effective Date,
(i) the Assignee shall be a party to the Agreement and, to the extent provided
in this Assignment and Acceptance, have the rights and obligations of a Lender
thereunder, and
(ii) the Assignor shall, with respect to that portion of its interest under the
Agreement assigned hereunder relinquish its rights and be released from its
obligations under the Agreement.
6. Upon such acceptance and recording, from and after the Effective Date,
the Agent shall make all payments in respect of the interest assigned hereby
(including payments of principal, interest, fees and other amounts) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments for periods prior to the Effective Date by the Agent or with respect to
the making of this assignment directly between themselves.
7. THIS ASSIGNMENT AND ACCEPTANCE IS INTENDED TO TAKE EFFECT AS A SEALED
INSTRUMENT TO BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.
IN WITNESS WHEREOF, intending to be legally bound, each of the undersigned
has caused this Assignment and Acceptance to be executed on its behalf by its
officer thereunto duly authorized, as of the date first above written.
[NAME OF ASSIGNOR]
By:_________________________________
Title:________________________________
[NAME OF ASSIGNEE]
By:_________________________________
Title:______________________________
SCHEDULE 1
Lenders; Domestic and Eurodollar Lending Offices
------------------------------------------------
BankBoston, N.A.
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
(Domestic and Eurodollar)
Prudential Securities Credit Corporation
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
(Domestic and Eurodollar)
Societe Generale
Xxxxxxx Xxxx Center
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
(Domestic and Eurodollar)
Commerzbank AG
000 Xxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
(Domestic and Eurodollar)
Banque Nationale de Paris
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
(Domestic and Eurodollar)
SCHEDULE 1.1
Mortgaged Properties Fee Owner
-------------------- ---------
1. Donnelley Building,
00 Xxxx Xxxxxx Xxxxx, Xxxxxxx, XX 77 West Xxxxxx Limited
Partnership
2. Hilton Parking Garage, Knoxville, TN Triad Parking Company, Ltd.
3. SunTrust Bank Bldg., 000 0xx Xxx., X.,
Xxxxxxxxx, XX Nashville Office Building I,
Ltd.
4. The Weston, 0000 Xxxxxxxx Xxxx,
Xxxxxxxxx, XX Old Kingston Properties, Ltd.
5. Xxx Xxxxxx Xxxxxx, 000 Xxxxxx Xx.,
Xxxxxxxxx, XX Professional Plaza, Ltd.
6. Xxx Xxxxxx Xxxxxx, 000 Xxx Xx.,
Xxxxxxxxx, XX Centre Square II, Ltd.
Assigned Mortgaged Properties Owner of Assigned Note
----------------------------- ----------------------
7. Continental Towers, Rolling Xxxxxxx, Borrower
Xxxx County, Illinois
SCHEDULE 1.2
Commitments
-----------
--------------------------------------------------------------------------------
Lender Commitment Temporary Commitment Commitment
Commitment % until % after
Commitment Commitment
Decrease Date Decrease
Date
--------------------------------------------------------------------------------
BankBoston, N.A. $ 62,500,000 $ 5,000,000 33.75% 32.89474%
--------------------------------------------------------------------------------
Prudential Securities $ 62,500,000 $ 5,000,000 33.75% 32.89474%
Credit Corporation
--------------------------------------------------------------------------------
Societe Generale $ 25,000,000 12.5% 13.1579%
--------------------------------------------------------------------------------
Commerzbank, AG $ 20,000,000 10% 10.52631%
--------------------------------------------------------------------------------
Banque Nationale de $ 20,000,000 10% 10.52631%
Paris
--------------------------------------------------------------------------------
Total $190,000,000 $10,000,000 100% 100%
--------------------------------------------------------------------------------
SCHEDULE 1.4
Letters of Credit
-----------------
------------------------------------------------------------------------------
Beneficiary IRB Project Face Amount
----------- ----------- -----------
------------------------------------------------------------------------------
First Tennessee Bank N.A. Nashville Office Building I, Ltd. $ 4,915,069.00
------------------------------------------------------------------------------
First Tennessee Bank N.A. Old Kingston Properties, Ltd. $ 3,583,905.00
------------------------------------------------------------------------------
First Tennessee Bank N.A. Professional Plaza, Ltd. $ 9,215,754.00
------------------------------------------------------------------------------
First Tennessee Bank N.A. Centre Square II, Ltd. $ 9,215,754.00
------------------------------------------------------------------------------
TOTAL $26,930,482.00
-----
------------------------------------------------------------------------------
