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EXHIBIT 10.32
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FIRST AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
AMONG
PRICE ENTERPRISES, INC.,
A MARYLAND CORPORATION,
AS BORROWER,
THE LENDERS HEREIN NAMED
AND
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
AS AGENT
Dated as of February 14, 2000
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TABLE OF CONTENTS
Page
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ARTICLE 1 - DEFINITIONS........................................................................1
1.1 Certain Defined Terms.....................................................................1
1.2 Use of Defined Terms.....................................................................33
1.3 Terms....................................................................................34
ARTICLE 2 - ADVANCES..........................................................................35
2.1 Loan Advances and Repayment..............................................................35
2.2 Authorization to Obtain Advances.........................................................39
2.3 Lenders' Accounting......................................................................40
2.4 Interest on the Advances.................................................................40
2.5 Fees.....................................................................................45
2.6 Payments.................................................................................47
2.7 Notice of Increased Costs and Certain Provisions
Regarding LIBOR Advances.................................................................48
2.8 Voluntary Termination or Reduction of Commitment.........................................49
ARTICLE 3 - CONDITIONS TO ADVANCES............................................................50
3.1 Conditions to Initial Advances...........................................................50
3.2 Conditions Precedent to All Advances.....................................................51
ARTICLE 4 - REPRESENTATIONS AND WARRANTIES....................................................53
4.1 Organization; Partnership Powers.........................................................53
4.2 Authority................................................................................53
4.3 No Conflict..............................................................................53
4.4 Consents and Authorizations..............................................................54
4.5 Governmental Regulation..................................................................54
4.6 Financial Statements; Projections and
Forecasts................................................................................54
4.7 Prior Operating Statements...............................................................54
4.8 Unencumbered Pool Statements and Projections.............................................55
4.9 Litigation; Adverse Effects..............................................................55
4.10 No Material Adverse Change...............................................................55
4.11 Payment of Taxes.........................................................................55
4.12 Material Adverse Agreements..............................................................56
4.13 Performance..............................................................................56
4.14 Federal Reserve Regulations..............................................................56
4.15 Disclosure...............................................................................56
4.16 Requirements of Law......................................................................57
4.17 Patents, Trademarks, Permits, Etc........................................................57
4.18 Environmental Matters....................................................................57
4.19 Solvency.................................................................................58
4.20 Title to Assets..........................................................................58
4.21 Management Agreements....................................................................58
4.22 Capitalization...........................................................................58
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4.23 ERISA....................................................................................58
4.24 Status as a REIT.........................................................................59
4.25 NASDAQ Listing...........................................................................59
ARTICLE 5 - REPORTING COVENANTS...............................................................60
5.1 Financial Statements and Other Financial and
Operating Information....................................................................60
5.2 Environmental Notices....................................................................67
5.3 Confidentiality..........................................................................68
ARTICLE 6 - AFFIRMATIVE COVENANTS.............................................................69
6.1 Existence................................................................................69
6.2 Qualification............................................................................69
6.3 Compliance with Laws, Etc................................................................69
6.4 Payment of Taxes and Claims..............................................................69
6.5 Maintenance of Properties; Insurance.....................................................70
6.6 Inspection of Property; Books and Records;
Discussion...............................................................................70
6.7 Maintenance of Permits, Etc..............................................................71
6.8 Conduct of Business......................................................................71
6.9 Use of Proceeds..........................................................................71
6.10 Securities Law Compliance................................................................71
6.11 Continued Status as a REIT; Prohibited
Transactions.............................................................................71
6.12 NASDAQ Listed Company....................................................................71
6.13 Year 2000 Covenant.......................................................................72
6.14 Additional Guarantors....................................................................72
6.15 Intentionally left blank.................................................................72
6.16 Security Interest in Entities............................................................72
6.17 Board of Directors of Borrower...........................................................73
6.18 Excel Legacy Corporation Board of Directors..............................................73
6.19 Annual Reserve...........................................................................73
6.20 Payment of Interest on Original Loan.....................................................73
ARTICLE 7 - NEGATIVE COVENANTS................................................................74
7.1 Restrictions on Fundamental Changes......................................................74
7.2 ERISA....................................................................................74
7.3 Debt and Guaranty Obligations............................................................75
7.4 Amendment of Constituent Documents.......................................................75
7.5 Minimum Ownership Interest of Sol and Xxxxxx
Xxxxx....................................................................................75
7.6 Management...............................................................................75
7.7 Margin Regulations.......................................................................76
7.8 Management Agreements....................................................................76
7.9 Preferred Stock..........................................................................76
7.10 Development Activity.....................................................................76
7.11 Organization of Borrower.................................................................78
7.12 Debt of Price Self Storage and Price
Enterprises LP...........................................................................78
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7.13 Transactions with Affiliates.............................................................78
7.14 Transfers of Assets......................................................................79
7.15 Company Agreement........................................................................79
ARTICLE 8 - FINANCIAL COVENANTS...............................................................81
8.1 Tangible Net Worth.......................................................................81
8.2 Maximum Total Liabilities to Gross Asset Value...........................................81
8.3 Minimum Unencumbered Asset Pool Value....................................................81
8.4 Minimum Interest Coverage Ratio..........................................................81
8.5 Minimum Fixed Charge Coverage Ratio......................................................81
8.6 Minimum Unsecured Interest Expense Coverage..............................................81
8.7 Distributions............................................................................81
8.8 Investments; Asset Mix...................................................................82
8.9 Secured Debt.............................................................................83
8.10 Gross Revenue............................................................................83
ARTICLE 9 - UNENCUMBERED ASSETS...............................................................84
9.1 Designation of Unencumbered Assets.......................................................84
9.2 Removal of Unencumbered Assets from
Unencumbered Pool........................................................................84
9.3 Site Inspections; Structural Inspections; and
Environmental Site Assessments...........................................................85
ARTICLE 10 - EVENTS OF DEFAULT; RIGHTS AND REMEDIES............................................86
10.1 Events of Default........................................................................86
10.2 Remedies Upon Event of Default...........................................................89
ARTICLE 11 - AGENCY PROVISIONS.................................................................92
11.1 Appointment and Authorization............................................................92
11.2 Agent and Affiliates.....................................................................92
11.3 Proportionate Interest in any Collateral.................................................92
11.4 Lenders' Credit Decisions................................................................93
11.5 Action by Agent..........................................................................93
11.6 Liability of Agent.......................................................................94
11.7 Indemnification..........................................................................95
11.8 Successor Agent..........................................................................96
11.9 No Obligations of Borrower...............................................................96
11.10 Disbursements of Advances................................................................97
11.11 Distribution and Apportionment of Payments...............................................98
11.12 Consent and Approvals...................................................................100
11.13 Certain Agency Provisions Relating to
Enforcement.............................................................................101
11.14 Ratable Sharing.........................................................................101
ARTICLE 12 - MISCELLANEOUS....................................................................103
12.1 Expenses................................................................................103
12.2 Indemnity...............................................................................104
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12.3 Change in Accounting Principles and "Funds from
Operations" Definition..................................................................104
12.4 Amendments and Consents......................................................................105
12.5 Independence of Covenants....................................................................107
12.6 Notices and Delivery.........................................................................107
12.7 Survival of Warranties, Indemnities and
Agreements..............................................................................107
12.8 Failure or Indulgence Not Waiver; Remedies
Cumulative..............................................................................107
12.9 Payments Set Aside...........................................................................108
12.10 Severability.................................................................................108
12.11 Headings.....................................................................................108
12.12 Governing Law................................................................................108
12.13 Limitation of Liability......................................................................108
12.14 Successors and Assigns.......................................................................109
12.15 Consent to Jurisdiction and Service of Process;
Waiver of Jury Trial....................................................................109
12.16 Counterparts; Effectiveness; Inconsistencies.................................................110
12.17 Performance of Obligations...................................................................110
12.18 Construction.................................................................................110
12.19 Entire Agreement.............................................................................110
12.20 Assignments and Participations...............................................................110
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LIST OF EXHIBITS AND SCHEDULES
Exhibits:
A - Form of Assignment and Assumption Agreement
B - Form of Compliance Certificate
C - Form of Fixed Rate Notice
D - Form of Guaranty
E - Form of Note
F - Form of Notice of Borrowing
G - Form of Pricing Certificate
Schedules:
1.1 - Pro Rata Shares of Lenders
2.1(e) - Adjusting Purchase Payments
2.2 - Employees Authorized to Sign Notices of
Borrowing
4.9 - List of Litigation
4.18 - Environmental Matters
4.21 - Management Agreements
4.23 - Benefit Plans
9.1 - List of Unencumbered Assets
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FIRST AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
THIS FIRST AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT,
dated as of February 14, 2000 (as amended, supplemented or modified from time to
time, the "Agreement"), is made and entered into by and among PRICE ENTERPRISES,
INC., a Maryland corporation ("Borrower"), each of the Lenders, as hereinafter
defined, and XXXXX FARGO BANK, NATIONAL ASSOCIATION ("Xxxxx Fargo"), as Agent.
RECITALS
(a) Pursuant to the Original Credit Agreement, the Original
Lenders made the Original Loan to Borrower.
(b) Effective as of the Closing Date, Bank One, Arizona, NA will
cease to be a Lender and BankBoston, N.A., and Bank One, NA, will each become a
Lender.
(c) Borrower, the Lenders and Agent desire to amend and restate
the Original Credit Agreement, all as more particularly set forth in this
Agreement.
NOW, THEREFORE, Borrower, the Lenders and Agent do hereby amend
and restate the Original Credit Agreement as follows:
ARTICLE 1
DEFINITIONS
1.1 Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Accountants" means any (i) "big five" accounting firm or (ii)
another firm of certified public accountants of recognized national standing
selected by Borrower and acceptable to Agent.
"Acquisition Price" means the aggregate purchase price for an
asset, including bona fide purchase money financing provided by the seller and
all other Indebtedness encumbering such asset at the time of acquisition.
"Additional Guarantors" means each wholly-owned Subsidiary of
Borrower formed or acquired by Borrower after the date of this Agreement.
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"Advance" means any advance made or to be made to Borrower
pursuant to Article 2, and includes each Base Rate Advance and each LIBOR
Advance.
"Affiliates" means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under
common control with"), as applied to any Person, means (a) the possession,
directly or indirectly, of the power to vote ten percent (10%) or more of the
Securities having voting power for the election of directors of such Person or
otherwise to direct or cause the direction of the management and policies of
that Person, whether through the ownership of voting Securities or by contract
or otherwise, or (b) the ownership of ten percent (10%) or more of the
outstanding general partnership or other ownership interests of such Person. For
purposes of this Agreement and the other Loan Documents, and notwithstanding
anything to the contrary in this definition of "Affiliates", Excel Legacy
Corporation shall be deemed to be an Affiliate of Borrower.
"Agent" means Xxxxx Fargo in its capacity as agent for the
Lenders under this Agreement, and any successor Agent appointed pursuant hereto.
"Annualized Property NOI" means, with respect to any Real
Property (including, without limitation, any Retail Property) and for any fiscal
period, (a) Property NOI of that Real Property plus (b) with respect to any such
fiscal period in which any Real Property (herein, the "New Property") has not
been owned and operated by Borrower for at least four (4) full Fiscal Quarters,
such amount as is necessary to reflect the annualization of Property NOI
attributable to the New Property using the following conventions: (i) if the New
Property has been owned and operated by Borrower for at least one (1) Fiscal
Quarter, the Property NOI of the New Property shall be multiplied by the
appropriate factor so as to result in Annualized Property NOI for the full four
(4) Fiscal Quarters and (ii) if the New Property has not been owned and operated
by Borrower for at least one (1) Fiscal Quarter, the Annualized Property NOI of
the New Property for the four (4) Fiscal Quarters shall be deemed to be the
Property NOI for such period reflected in a pro-forma income statement for the
New Property prepared by Borrower in good faith using reasonable assumptions
consistent with all facts known to Borrower and reasonably approved by Agent.
"Annual Reserve" has the meaning given to such term in Section
6.19, below.
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"Applicable LIBOR Rate Margin" means, during each Pricing
Period, the interest rate margin set forth below (expressed in basis points per
annum) opposite the Applicable Pricing Level for that Pricing Period:
Applicable
Pricing Level Margin
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I 110.00
II 120.00
III 125.00
IV 130.00
V 135.00
VI 140.00
VII 145.00
"Applicable Pricing Level" means (a) for the Pricing Period from
the Closing Date and ending on Xxxxx 00, 0000, Xxxxxxx Xxxxx XX xxx (x) for each
Pricing Period thereafter, the pricing level set forth below opposite, as
applicable, either (i) if Agent did not receive a Rating Notice, the Total
Liabilities to Gross Asset Value Ratio as of the last day of the Fiscal Quarter
most recently ended prior to the commencement of that Pricing Period, or (ii)
if Agent did receive a Rating Notice, the Borrower's Long-Term Unsecured Senior
Debt Rating as of such last day of the Fiscal Quarter most recently ended, in
each case as determined by Agent:
Borrower's Long-Term
Pricing Level Unsecured Senior Debt Rating
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I A-/A3 or higher
II BBB+/Baa1
III BBB/Baa2
IV BBB-/Baa3
Total Liabilities to
Gross Asset Value Ratio
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V Less than or equal to 25%
VI Greater than 25%, but less
than 35%
VII Equal to or greater than 35%
If the Applicable Pricing Level for any Pricing Period is to be
determined based upon the ratio of Total Liabilities to Gross
Asset Value and in the event that Borrower does not deliver a
Pricing Certificate with respect to such Pricing Period prior
to the commencement of such Pricing Period, then until (but
only until) such Pricing Certificate is delivered the
applicable Pricing Level for that Pricing Period shall be
Pricing Level VII. "Borrower's Long-Term Unsecured Senior Debt
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Rating" referred to above shall be the lower of such rating as set by Standard &
Poor's and as set by Xxxxx'x Investors Service, Inc.
"Assignment and Assumption" means an Assignment and Assumption
Agreement substantially in the form of Exhibit A hereto (with blanks
appropriately filled in) delivered to Agent in connection with each assignment
of a Lender's interest under this Agreement pursuant to Section 12.20.
"Base Rate" means, on any day, the higher of (a) the rate of
interest per annum established from time to time by Agent at its principal
office in San Francisco, California, and designated as its prime rate as in
effect on such day and (b) the Federal Funds Rate in effect on such day plus
one-half of one percent (0.5%) per annum.
"Base Rate Advance" means an Advance bearing interest at the
Base Rate.
"Base Rent" means the "base rent" or "minimum rent" due under a
lease or other rental agreement. "Base Rent" shall not include any percentage
rent or operating cost reimbursement items.
"Benefit Plan" means any employee pension benefit plan as
defined in Section 3(2) of ERISA (other than a Multiemployer Plan) which is
subject to Title IV of ERISA in respect of which a Person or an ERISA Affiliate
is, or within the immediately preceding five (5) years was, an "employer" as
defined in Section 3(5) of ERISA.
"Borrower" means Price Enterprises, Inc., a Maryland
corporation.
"Business Day" means (a) with respect to any Advance, payment or
rate determination of LIBOR Advances, a day, other than a Saturday or Sunday, on
which Agent is open for business in San Francisco, California and on which
dealings in Dollars are carried on in the London interbank market, and (b) for
all other purposes, any day excluding Saturday, Sunday and any day which is a
legal holiday under the laws of the State of California, or is a day on which
banking institutions located in California are required or authorized by law or
other governmental action to close.
"Capital Lease" means, as applied to any Person, any lease of
any property (whether real, personal or mixed) by that Person as lessee which,
in conformity with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
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"Capital Lease Obligations" means all monetary obligations of a
Person under any Capital Lease.
"Capitalized Loan Fees" means, with respect to the Borrower and
any Consolidated Entity, and with respect to any period, (a) any up-front,
closing or similar fees paid by such Person in connection with the incurring or
refinancing of Indebtedness during such period and (b) all other costs incurred
in connection with the incurring or refinancing of Indebtedness during such
period, including, without limitation, appraisal fees paid to lenders, costs and
expenses incurred in connection with Swap Agreements, phase 1 environmental
report review fees paid to lenders and legal fees, in each of the foregoing
cases, that are capitalized on the balance sheet of such Person and amortized
over the term of such Indebtedness.
"Capital Stock" means, with respect to any Person, all (i)
shares, interests, participations or other equivalents (howsoever designated) of
capital stock (including, without limitation, preferred stock and common stock)
or partnership or other equity interests of such Person and (ii) rights (other
than debt securities convertible into capital stock or other equity interests),
warrants or options to acquire any such capital stock or partnership or other
equity interests of such Person.
"Carryover Principal Balance" means $98,200,000, which is the
outstanding principal balance of the Original Loan as of the date of this
Agreement.
"Cash" means, when used in connection with any Person, all
monetary and nonmonetary items owned by that Person that are treated as cash in
accordance with GAAP, consistently applied. "Cash" shall not include tenant
deposits.
"Cash Equivalents" means, when used in connection with any
Person, that Person's Investments in: (a) marketable direct obligations issued
or unconditionally guaranteed by the United States Government or issued by an
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one (1) year after the date of acquisition thereof;
(b) marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within ninety (90) days after the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from any two of Standard & Poor's, Xxxxx'x Investors
Service, Inc., Duff and Xxxxxx, or Xxxxx Investors Service, Inc. (or, if at any
time no two of the foregoing shall be rating such obligations, then from such
other nationally recognized rating services as may be acceptable to Agent) and
not listed for possible down-grade in
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Credit Watch published by Standard & Poor's; (c) commercial paper, other than
commercial paper issued by Borrower or any of its Affiliates, maturing no more
than ninety (90) days after the date of creation thereof and, at the time of
acquisition, having a rating of at least A-1 or P-1 from either Standard &
Poor's, or Xxxxx'x Investors Service, Inc. or, if at any time neither Standard &
Poor's, nor Xxxxx'x Investors Service, Inc. shall be rating such obligations,
then the highest rating from such other nationally recognized rating services as
may be acceptable to Agent; and (d) domestic and Eurodollar certificates of
deposit or time deposits or bankers' acceptances maturing within ninety (90)
days after the date of acquisition thereof, overnight securities repurchase
agreements, or reverse repurchase agreements secured by any of the foregoing
types of securities or debt instruments issued, in each case, by any commercial
bank organized under the laws of the United States of America or any state
thereof or the District of Columbia or Canada which at the time of acquisition
(A) has (or, in the case of a bank which is a subsidiary, such bank's parent
has) a rating of its senior unsecured debt obligations of not less than Baa-2 by
Xxxxx'x Investors Service, Inc. or a comparable rating by a rating agency
acceptable to Agent and (B) has total assets in excess of Ten Billion Dollars
($10,000,000,000).
"Closing Date" means the date on which the applicable conditions
contained in Sections 3.1 and 3.2 are satisfied or waived. The Agent shall
deliver written notice to the Borrower and the Lenders confirming the date on
which the Closing Date occurs.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time.
"Commission" means the Securities and Exchange Commission.
"Commitment" means, subject to Sections 2.7 and 2.8,
$125,000,000. As of the Closing Date, the respective Pro Rata Shares of the
Lenders with respect to the Commitment are set forth in Schedule 1.1.
"Company Agreement" means that certain Agreement, dated June 2,
1999, between Excel Legacy Corporation and Borrower.
"Compliance Certificate" means a certificate in the form of
Exhibit B properly completed and signed by an Executive Officer.
"Consolidated Entity" means any Person the accounts of which are
consolidated with those of the Borrower in the
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consolidated financial statements of the Borrower in accordance with GAAP.
"Construction Advance" means an Advance all or a portion of
which is or will be used to construct improvements on Real Property or otherwise
used in the development of Real Property.
"Construction Expenditures" means the total expenditures made
through any given date for project costs of all construction projects on Real
Property which expenditures with respect to each such construction project shall
be counted until a valid notice of completion with respect to all of such
construction project is recorded in the official records of the county in which
such project is located.
"Contaminant" means any pollutant (as that term is defined in 42
U.S.C. 9601(33)) or toxic pollutant (as that term is defined in 33 U.S.C.
1362(13)), hazardous substance (as that term is defined in 42 U.S.C. 9601(14)),
hazardous chemical (as that term is defined by 29 CFR Section 1910.1200(c)),
toxic substance, hazardous waste (as that term is defined in 42 U.S.C. 6903(5)),
radioactive material, special waste, petroleum (including crude oil or any
petroleum-derived substance, waste, or breakdown or decomposition product
thereof), any constituent of any such substance or waste, including, but not
limited to, polychlorinated biphenyls and asbestos, or any other substance or
waste deleterious to the environment the release, disposal or remediation of
which is now or at any time becomes subject to regulation under any
Environmental Law.
"Contractual Obligation" as applied to any Person, means any
provision of any Securities issued by that Person or any indenture, mortgage,
deed of trust, lease, contract, undertaking, document or instrument to which
that Person is a party or by which it or any of its properties is bound, or to
which it or any of its properties is subject (including, without limitation, any
restrictive covenant affecting such Person or any of its properties).
"Court Order" means any judgment, writ, injunction, decree, rule
or regulation of any court or Governmental Authority binding upon the Person in
question.
"Credit Tenant" means a tenant of Real Property which is a
corporation with senior long-term unsecured debt obligations which are rated at
least BBB- by Standard & Poor's or at least an equivalent rating by Xxxxx'x
Investors Service, Inc.
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"Debt" means, with respect to any Person, without duplication,
the principal amount of (a) its liabilities for borrowed money, (b) its
liabilities for the deferred purchase price of property acquired by such Person
(excluding accounts payable in the ordinary course of business, but including,
without limitation, all liabilities created or arising under any conditional
sale or other title retention agreement with respect to any property), (c) its
Capitalized Lease Obligations, (d) any liabilities for borrowed money secured by
a Lien with respect to any property owned by such Person (whether or not it is
assumed by such Person or such Person otherwise becomes liable for such
liabilities), (e) all liabilities with respect to any unreimbursed draws on
letters of credit and (f) any guaranty of such Person with respect to any of the
foregoing.
"Debtor Relief Laws" means the Bankruptcy Code of the United
States of America, as amended from time to time, and all other applicable
liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, or similar debtor relief Laws from
time to time in effect affecting the rights of creditors generally.
"Debt Service" means, for any period, Interest Expense for such
period plus scheduled principal amortization (excluding any balloon or bullet
payment due at maturity) for such period on all Debt of the Borrower and the
Consolidated Entities and on the Borrower's and each Consolidated Entity's pro
rata share of all Debt of each Unconsolidated Joint Venture. For purposes of the
foregoing definition, the Borrower's and such Consolidated Entity's pro rata
share of such Debt shall be deemed to be equal to the product of (i) such Debt,
multiplied by (ii) the percentage of the total outstanding Capital Stock of such
Unconsolidated Joint Venture held by the Borrower or such Consolidated Entity,
expressed as a decimal.
"Defaulting Lender" means any Lender which fails or refuses to
perform its obligations under this Agreement within the time period specified
for performance of such obligation or, if no time frame is specified, if such
failure or refusal continues for a period of five (5) Business Days after notice
from Agent.
"Depreciation and Amortization Expense" means (without
duplication), for any period, the sum for such period of (i) total depreciation
and amortization expense, whether paid or accrued, of the Borrower and the
Consolidated Entities, plus (ii) the Borrower's and each Consolidated Entity's
pro rata share of depreciation and amortization expenses of Unconsolidated Joint
Ventures. For purposes of this definition, the Borrower's and such Consolidated
Entity's pro
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rata share of depreciation and amortization expense of any Unconsolidated Joint
Venture shall be deemed equal to the product of (i) the depreciation and
amortization expense of such Unconsolidated Joint Venture, multiplied by (ii)
the percentage of the total outstanding Capital Stock of such Unconsolidated
Joint Venture held by the Borrower or such Consolidated Entity, expressed as a
decimal.
"Designated Market" means, with respect to any LIBOR Advance,
the London interbank LIBOR market or such other interbank LIBOR market as may be
designated in writing from time to time by the Requisite Lenders.
"Developer Affiliates" means each Affiliate of Borrower engaged
in the development of real estate and any entity in which any such Affiliate has
an ownership interest.
"Development Investments" means the aggregate of all Investments
by Borrower or any Consolidated Entity in (a) Developer Affiliates or (b) any
other Person (whether or not an affiliate of Borrower) directly or indirectly
engaged in the development of real estate or in the making of land acquisition
or construction loans to other Persons engaged in the development of real
estate.
"Disqualified Stock" means any capital stock, warrants, options
or other rights to acquire capital stock (but excluding any debt security which
is convertible, or exchangeable, for capital stock), which, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable prior to the Maturity Date, pursuant to a sinking fund obligation or
otherwise, or is or may be redeemable at the option of the holder thereof, in
whole or in part, prior to the Maturity Date.
"DOL" means the United States Department of Labor and any
successor department or agency.
"Dollars" and "$" means the lawful money of the United States of
America.
"EBITDA" means, for any period, Net Income, plus (without
duplication) (a) Interest Expense (including Borrower's pro rata share of such
expense with respect to each Unconsolidated Joint Venture), (b) Tax Expense
(including Borrower's pro rata share of such expense with respect to each
Unconsolidated Joint Venture) and (c) Depreciation and Amortization Expense
(including Borrower's pro rata share of such expense with respect to each
Unconsolidated Joint Venture), in each case for such period minus (d) the income
of any Consolidated Entity, to the extent that the declaration or
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payment of dividends or other distributions by that Consolidated Entity of such
income is not at the time permitted by operation of any Contractual Obligation
or Requirement of Law applicable to such Consolidated Entity. For purposes of
this definition, Borrower's pro rata share of each of the foregoing expenses
shall be deemed equal to the product of (i) such expense of such Unconsolidated
Joint Venture, multiplied by (ii) the percentage of the total outstanding
Capital Stock of such Unconsolidated Joint Venture held by the Borrower,
expressed as a decimal.
"Entity" has the meaning set forth in Section 6.16.
"Entity Security Agreement" has the meaning set forth in Section
6.16.
"Environmental Laws" has the meaning set forth in Section 4.18.
"Environmental Lien" means a Lien in favor of any Governmental
Authority for (a) any liability under Environmental Laws, or (b) damages
arising from, or costs incurred by such Governmental Authority in response to, a
Release or threatened Release of a Contaminant into the environment.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute.
"ERISA Affiliate" means, with respect to any Person, any (a)
corporation which is, becomes, or is deemed to be a member of the same
controlled group of corporations (within the meaning of Section 414(b) of the
Code) as such Person, (b) partnership, trade or business (whether or not
incorporated) which is, becomes or is deemed to be under common control (within
the meaning of Section 414(c) of the Code) with such Person, (c) solely for
purposes of potential liability under Section 302(c)(11) of ERISA and Section
412(c)(11) of the Code and the lien created under Section 302(f) of ERISA and
Section 412(n) of the Code, Person which is, becomes or is deemed to be a member
of the same "affiliated service group" (as defined in Section 414(m) of the
Code) as such Person, or (d) solely for purposes of potential liability under
Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code and the lien
created under Section 302(f) of ERISA and Section 412(n) of the Code, other
organization or arrangement described in Section 414(o) of the Code which is,
becomes or is deemed to be required to be aggregated pursuant to regulations
issued under Section 414(o) of the Code with such Person pursuant to Section
414(o) of the Code.
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"Event of Default" means any of the occurrences so defined in
Article 10.
"Excel Common Stock Acquisition" means the acquisition by Excel
Legacy Corporation of the common stock of Borrower as described in the Excel
S-4.
"Excel Legacy Corporation" means Excel Legacy Corporation, a
Delaware corporation.
"Excel S-4" means Amendment No. 1 to Form S-4 Registration
Statement filed by Excel Legacy Corporation with the Commission on July 27,
1999.
"FDIC" means the Federal Deposit Insurance Corporation or any
successor thereto.
"Executive Officer" means the chief executive officer and the
chief financial officer of Borrower.
"Federal Funds Rate" means, as of any date of determination,
the rate set forth in the weekly statistical release designated as H.15(519), or
any successor publication, published by the Federal Reserve Board (including any
such successor, "H.15(519)") for such date opposite the caption "Federal Funds
(Effective)". If for any relevant date such rate is not yet published in
H.15(519), the rate for such date will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotation for U.S.
Government Securities, or any successor publication, published by the Federal
Reserve Bank of New York (including any such successor, the "Composite 3:30 p.m.
Quotation") for such date under the caption "Federal Funds Effective Rate". If
on any relevant date the appropriate rate for such date is not yet published in
either H.15(519) or the Composite 3:30 p.m. Quotation, the rate for such date
will be the arithmetic mean of the rates for the last transaction in overnight
Federal funds arranged prior to 9:00 a.m. (New York City time) on that date by
each of three leading brokers of Federal Funds transactions in New York City
selected by the Agent. For purposes of this Agreement, any change in the Base
Rate due to a change in the Federal Funds Rate shall be effective as of the
opening of business on the effective date of such change.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System or any governmental authority succeeding to its
functions.
"FIRREA" means the Financial Institutions Recovery, Reform and
Enforcement Act of 1989, as amended from time to time.
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"Fiscal Quarter" means each three-month period ending on March
31, June 30, September 30 and December 31.
"Fiscal Year" means the fiscal year of Borrower ending on each
December 31.
"Fixed Charge Coverage Ratio" means, as of the last day of each
Fiscal Quarter, the ratio of (i) EBITDA for the fiscal period consisting of that
Fiscal Quarter and the three (3) immediately preceding Fiscal Quarters, to (ii)
Fixed Charges for such period.
"Fixed Charges" means, for any fiscal period, the sum of (i)
scheduled payments of principal of Debt of the Borrower and the Consolidated
Entities (other than any balloon payment, referred to herein as a "bullet
payment"), (ii) the Borrower's and each Consolidated Entity's pro rata share of
scheduled payments of principal of Debt of Unconsolidated Joint Ventures (other
than bullet payments) that does not otherwise constitute Debt of and is not
otherwise recourse to the Borrower or such Consolidated Entity or their assets,
(iii) Interest Expense, (iv) the Replacement Reserve Amount for all Real
Properties owned by the Borrower or any of the Consolidated Entities, (v) Tax
Expense, and (vi) all dividends on Preferred Stock distributed or otherwise paid
during such fiscal period, in each case, at the end of such period. For purposes
of clause (ii), the Borrower's and such Consolidated Entity's pro rata share of
payments by any Unconsolidated Joint Venture shall be deemed equal to the
product of (a) the payments made by such Unconsolidated Joint Venture,
multiplied by (b) the percentage of the total outstanding Capital Stock of such
Unconsolidated Joint Venture held by the Borrower or such Consolidated Entity,
expressed as a decimal.
"Fixed Rate Notice" means, with respect to a LIBOR Advance
pursuant to Section 2.1(b), a notice substantially in the form of Exhibit C.
"Fixed Rate Price Adjustment" has the meaning given to such term
in Section 2.4(h)(iii).
"Foreign Properties" means all Real Properties which are not
located within the boundaries of the United States.
"Funding Date" means, with respect to any Advance, the date of
the funding of such Advance.
"Funds from Operations" shall be interpreted consistently with
the NAREIT Definition and, subject to Section 12.3, shall mean, for any period,
net income for such period excluding gains (or losses) from debt restructuring
and sales of Real Property, plus the portion of Depreciation and
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Amortization Expenses during such period which is attributable to Real Property,
and after adjustments for Unconsolidated Joint Ventures. (Adjustments for
Unconsolidated Joint Ventures shall be calculated to reflect funds from
operations on the same basis.)
"Fund Transfer Agreement" means that certain Funds Transfer
Agreement, dated as of December 3, 1998, and executed by Borrower and Xxxxx
Fargo Bank, National Association.
"GAAP" means generally accepted accounting principles set forth
in the opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board, or in such other
statements by such other entity as may be in general use by significant segments
of the accounting profession, which are applicable to the circumstances as of
the date of determination.
"Governmental Authority" means any nation or government, any
federal, state, local, municipal or other political subdivision thereof or any
entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Gross Asset Value" means, as of the date of determination, the
sum of (without duplication):
(i) the product of (x) EBITDA of the Borrower and the
Consolidated Entities for the fiscal period consisting of the Fiscal Quarter
most recently ended, multiplied by (y) 4, divided by .10; and
(ii) Cash and Cash Equivalents held by the Borrower and the
Consolidated Entities on the last day of such most recently ended Fiscal
Quarter.
"Gross Revenue" means, for any fiscal period, all base and
minimum rent recognized in accordance with GAAP by Borrower and the Consolidated
Entities during such fiscal period from tenants of Unencumbered Assets. "Gross
Revenue" shall not include percentage rent, reimbursements, pass-through
expenses or other amounts.
"Guarantors" means Price Enterprises - TX, Inc., a Delaware
corporation, and each Additional Guarantor.
"Guaranty" means that certain Guaranty, dated as of December 3,
1998, and executed by Price Enterprises - TX, Inc., a Delaware corporation, in
favor of Agent, and all other guaranties in the form of Exhibit D executed by
Guarantors.
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"Guaranty Obligation" means, as to any Person, any (a) guarantee
by that Person of Indebtedness of, or other obligation performable by, any other
Person or (b) assurance given by that Person to an obligee of any other Person
with respect to the performance of an obligation by, or the financial condition
of, such other Person, whether direct, indirect or contingent, including any
purchase or repurchase agreement covering such obligation or any collateral
security therefor, any agreement to provide funds (by means of loans, capital
contributions or otherwise) to such other Person, any agreement to support the
solvency or level of any balance sheet item of such other Person or any
"keep-well" or other arrangement of whatever nature given for the purpose of
assuring or holding harmless such obligee against loss with respect to any
obligation of such other Person; provided, however, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation in respect of Indebtedness shall be deemed to be an amount equal to
the stated or determinable amount of the related Indebtedness (unless the
Guaranty Obligation is limited by its terms to a lesser amount, in which case to
the extent of such amount) or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the Person
in good faith. The amount of any other Guaranty Obligation shall be deemed to be
zero unless and until the amount thereof has been (or in accordance with
Financial Accounting Standards Board Statement No. 5 should be) quantified and
reflected or disclosed in the consolidated financial statements (or notes
thereto) of such Person.
"Indebtedness" means, as to any Person (without duplication),
(a) all indebtedness, obligations or other liabilities of such Person for
borrowed money, whether or not subordinated and whether with or without recourse
beyond any collateral security, (b) all indebtedness, obligations or other
liabilities of such Person evidenced by Securities or other similar instruments
(other than payments or distributions with respect to Borrower's Capital Stock),
(c) all reimbursement obligations and other liabilities of such Person with
respect to letters of credit or banker's acceptances issued for such Person's
account, (d) all obligations of such Person to pay the deferred purchase price
of Property or services, (e) the principal portion of Capital Lease Obligations
of such Person set forth in the financial statements of such Person, (f) all
Guaranty Obligations of such Person, (g) all Contractual Obligations of such
Person (other than payments or distributions with respect to the Borrower's
Capital Stock), (h) all indebtedness, obligations or other liabilities of such
Person or others secured by a Lien on any asset of such Person, whether or not
such indebtedness, obligations or liabilities are assumed by, or are a personal
liability of, such Person
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(including, without limitation, the principal amount of any assessment or
similar indebtedness encumbering any property), (i) ERISA obligations currently
due and payable, (j) as applied to the Borrower and the Consolidated Entities,
all indebtedness, obligations or other liabilities of Unconsolidated Joint
Ventures which are recourse to the Borrower and/or any of the Consolidated
Entities, (k) the Borrower's and Consolidated Entities' pro rata share of
Nonrecourse Debt of Unconsolidated Joint Ventures, (l) improvement and
assessment district taxes (including, without limitation, taxes under the
Xxxxx-Xxxx Community Facilities Act of 1982) assessed or otherwise due with
respect to any Property of such Person, (m) forward purchase obligations, (n)
purchase obligations based on forward equity sales, (o) contingent liabilities,
(p) unfunded obligations of such Person (including, without limitation, all
obligations to invest in other Persons), (q) any net obligations of such Person
under Swap Agreements and (r) without duplication or limitation, all liabilities
and other obligations included in the financial statements (or notes thereto) of
such Person as prepared in accordance with GAAP. For purposes of clause (k), the
Borrower's and the Consolidated Entities' pro rata share of Nonrecourse Debt of
any Unconsolidated Joint Venture shall be deemed to be equal to the product of
(i) the Nonrecourse Debt of such Unconsolidated Joint Venture, multiplied by
(ii) the percentage of the total outstanding Capital Stock of such Joint Venture
held by the Borrower or any Consolidated Entity, expressed as a decimal. With
respect to any agreement entered into by such Person to purchase Real Property,
"Indebtedness" shall not include any amount in excess of the amount (if any)
which such Person is obligated to pay as liquidated damages under such agreement
in the event such Person breaches its obligation to purchase such Real Property.
"Intangible Assets" means assets that are considered intangible
assets under GAAP, including customer lists, goodwill, copyrights, trade names,
trademarks, and patents.
"Interest Coverage Ratio" means, as of the last day of each
Fiscal Quarter, the ratio of (i) EBITDA for the fiscal period consisting of that
Fiscal Quarter and the three (3) immediately preceding Fiscal Quarters then most
recently ended, to (ii) Interest Expense for such fiscal period.
"Interest Expense" means, for any period, the sum (without
duplication) for such period of (i) total interest expense, whether paid or
accrued, of the Borrower and the Consolidated Entities and the portion of any
Capitalized Lease Obligations allocable to interest expense during such period,
including the Borrower's and each Consolidated Entity's share of interest
expenses in Unconsolidated Joint Ventures but excluding amortization or writeoff
of debt discount and expense (except as provided in clause (ii) below), (ii)
with respect to
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the Borrower and the Consolidated Entities, amortization of costs related to
Swap Agreements, (iii) with respect to the Borrower and the Consolidated
Entities, capitalized interest, (iv) with respect to the Borrower and the
Consolidated Entities, letter of credit fees, (v) amortization of Capitalized
Loan Fees, (vi) to the extent not included in clauses (i), (ii), (iii), (iv) and
(v), the Borrower's and each Consolidated Entity's pro rata share of interest
expense and other amounts of the type referred to in such clauses of the
Unconsolidated Joint Ventures, and (vii) interest incurred on any liability or
obligation that constitutes a Guaranty Obligation of the Borrower or any
Consolidated Entity. For purposes of clause (vi), the Borrower's and such
Consolidated Entity's pro rata share of interest expense or other amount of any
Unconsolidated Joint Venture shall be deemed equal to the product of (a) the
interest expense or other relevant amount of such Unconsolidated Joint Venture,
multiplied by (b) the percentage of the total outstanding Capital Stock of such
Unconsolidated Joint Venture held by the Borrower or such Consolidated Entity,
expressed as a decimal.
"Interest Period" means, with respect to each LIBOR Advance, a
period commencing on a Business Day and ending one (1), three (3), six (6) or
twelve (12) months thereafter, as specified by the Borrower pursuant to Section
2.1(b), provided that any such period that would otherwise end on a day that is
not a Business Day shall be extended to the next succeeding Business Day unless
such Business Day falls in another calendar month, in which case such period
shall end on the immediately preceding Business Day.
"Investment" means, with respect to any Person, (i) any direct
or indirect purchase or other acquisition by that Person of stock or securities,
or any beneficial interest in stock or other securities, of any other Person,
any partnership interest (whether general or limited) in any other Person, or
all or any substantial part of the business or assets of any other Person, (ii)
any direct or indirect loan, advance or capital contribution by that Person to
any other Person, including all indebtedness and accounts receivable from that
other Person that are not current assets or did not arise from sales to that
other Person in the ordinary course of business. The amount of any Investment
shall be the amount actually invested (minus any return of capital with respect
to such Investment which has actually been received in Cash or has been
converted into Cash), without adjustments for subsequent increases or decreases
in the value of such Investment.
"Investment Mortgages and Notes Receivable" means mortgages or
deeds of trust securing indebtedness and/or promissory notes owned by Borrower.
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"IRS" means the Internal Revenue Service and any Person
succeeding to the functions thereof.
"Joint Venture" means a joint venture, partnership, limited
liability company, business trust or similar arrangement, whether in corporate,
partnership or other legal form; provided that, as to any such arrangement in
corporate form, such corporation shall not, as to any Person of which such
corporation is a Subsidiary, be considered to be a Joint Venture to which such
Person is a party.
"Land" means unimproved land owned by Borrower or any
Consolidated Entity for the purpose of future development of improvements. For
purposes of the foregoing definition, "unimproved" means Land on which the
construction of improvements has not commenced or has been discontinued, prior
to the completion of such improvements, for a continuous period of more than
sixty (60) days.
"Law" means, collectively, all international, foreign, federal,
state and local laws, statutes, treaties, rules, regulations, ordinances, codes
and administrative and judicial precedents.
"Lender Taxes" has the meaning given to such term in Section
2.4(g).
"Lenders" means Xxxxx Fargo, Bank One, NA, AmSouth Bank,
BankBoston, N.A., and any other bank, finance company, insurance or other
financial institution which is or becomes a party to this Agreement by execution
of a counterpart signature page hereto or an Assignment and Assumption, as
assignee. With respect to matters requiring the consent to or approval of all
Lenders at any given time, all then existing Defaulting Lenders will be
disregarded and excluded, and, for voting purposes only, "all Lenders" shall be
deemed to mean "all Lenders other than Defaulting Lenders".
"Liabilities and Costs" means all claims, judgments,
liabilities, obligations, responsibilities, losses, damages (including lost
profits), punitive or treble damages, costs, disbursements and expenses
(including, without limitation, reasonable attorneys', experts' and consulting
fees and costs of investigation and feasibility studies), fines, penalties and
monetary sanctions, interest, direct or indirect, known or unknown, absolute or
contingent, past, present or future.
"LIBOR Advance" means an Advance bearing interest at a fixed
rate of interest determined by reference to the LIBOR Rate.
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"LIBOR Office" means, relative to any Lender, the office of such
Lender designated as such on the counterpart signature pages hereto or such
other office of a Lender as designated from time to time by notice from such
Lender to Agent, whether or not outside the United States.
"LIBOR Rate" means, with respect to any LIBOR Advance, the rate
per annum (determined solely by the Agent and rounded upward to the next 1/16th
of one percent ) at which deposits in Dollars are offered to the Agent in the
Designated Market at approximately 9:00 a.m. (California time) two (2) Business
Days prior to the first day of the applicable Interest Period in an amount
approximately equal to such LIBOR Advance, and for a period of time comparable
to the number of days in the applicable Interest Period. The determination of
the LIBOR Rate by Agent shall be conclusive in the absence of manifest error.
The foregoing rate of interest shall be reserve adjusted by dividing the LIBOR
Rate by one (1.00) minus the LIBOR Reserve Percentage, with such quotient to be
rounded upward to the nearest whole multiple of one-hundredth of one percent
(0.01%). All references in this Agreement or other Loan Documents to the LIBOR
Rate include the aforesaid reserve adjustment.
"LIBOR Reserve Percentage" means, relative to any Interest
Period for LIBOR Advances made by any Lender, the reserve percentage (expressed
as a decimal) equal to the actual aggregate reserve requirements (including all
basic, emergency, supplemental, marginal and other reserves and taking into
account any transactional adjustments or other scheduled changes in reserve
requirements) announced within Agent as the reserve percentage applicable to
Agent as specified under regulations issued from time to time by the Federal
Reserve Board. The LIBOR Reserve Percentage shall be based on Regulation D of
the Federal Reserve Board or other regulations from time to time in effect
concerning reserves for "Eurocurrency Liabilities" from related institutions as
though Agent were in a net borrowing position.
"Lien" means any mortgage, deed of trust, pledge, negative
pledge, hypothecation, collateral assignment, deposit arrangement, security
interest, encumbrance (including, but not limited to, easements, rights-of-way,
zoning restrictions and the like), lien (statutory or other), springing lien,
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever, including, without limitation, any conditional
sale or other title retention agreement, the interest of a lessor under a
Capital Lease, any financing lease having substantially the same economic effect
as any of the foregoing, and the filing of any financing statement or document
having similar effect (other than a financing statement filed by a "true" lessor
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pursuant to 9408 of the Uniform Commercial Code) naming the owner of the asset
to which such Lien relates as debtor, under the Uniform Commercial Code or other
comparable law of any jurisdiction.
"Loan Account" has the meaning given to such term in Section
2.3.
"Loan Documents" means this Agreement, the Notes, each Guaranty,
the Stock Pledge Agreement, each Entity Security Agreement, the Price
Enterprises Security Agreement, the Funds Transfer Agreement and all other
agreements, instruments and documents (together with amendments and supplements
thereto and replacements thereof) now or hereafter executed by the Borrower, any
Guarantor, Price Enterprises LP, any Entity and/or any other Person which
evidence, guarantee or secure the Obligations, in each case either as originally
executed or as the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"Major Agreements" means, with respect to any Real Property
included within the Unencumbered Pool or which Borrower proposes for inclusion
within the Unencumbered Pool, (a) a lease of such Real Property with respect to
25,000 square feet or more of gross leasable area, and (b) any other agreement,
contract or other document or instrument pertaining to the operation, management
and/or maintenance of such Real Property that affects or otherwise impacts more
than 25% of gross leasable area of such Real Property.
"Material Adverse Effect" means any set of circumstances or
events which (a) has had or could reasonably be expected to have any material
adverse effect whatsoever upon the validity or enforceability of any Loan
Document, (b) has been or could reasonably be expected to be material and
adverse to the business or condition (financial or otherwise) of Borrower and
the Guarantors, taken as a whole, or (c) has materially impaired or could
reasonably be expected to materially impair the ability of Borrower to perform
the Obligations or the ability of the Guarantors, taken as a whole, to perform
their obligations under the Guaranties executed by them.
"Maturity Date" has the meaning given to such term in Section
2.1(d).
"Minority Interests" means "minority interests" (determined in
accordance with GAAP) as set forth in Borrower's consolidated financial
statements.
"Multiemployer Plan" means an employee benefit plan defined in
Section 4001(a)(3) of ERISA which is, or within the
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immediately preceding six (6) years was, contributed to by a Person or an ERISA
Affiliate.
"NAREIT Definition" has the meaning given to such term in
Section 12.3.
"NASDAQ" means The Nasdaq National Market.
"Net Income" means, for any period, total net income (or loss)
of the Borrower and the Consolidated Entities for such period determined in
accordance with GAAP, provided that there shall be excluded therefrom (i) any
charge attributable to, or otherwise on account of, Minority Interests, (ii) any
income or loss attributable to extraordinary items (including, without
limitation, any income or loss attributable to restructuring of Indebtedness),
and (iii) gains and losses from sales of assets; provided that, for purposes of
the foregoing clause (ii), the Stock Acquisition Costs and Expenses shall be
deemed to be extraordinary items.
"Net Offering Proceeds" means all cash proceeds (net of
discounts) received by Borrower as a result of (a) the sale or issuance of any
equity security or security convertible into an equity security including
common, preferred or other classes of stock in Borrower or (b) the sale or
issuance of debt instruments or obligations of Borrower, whether or not
convertible into any equity security, less, in each case, customary fees and
expenses incurred in connection with such sale or issuance.
"Non-Pro Rata Advance" means an Advance with respect to which
fewer than all Lenders have funded their respective Pro Rata Shares of such
Advance and the failure of the non-funding Lender or Lenders to fund its or
their respective Pro Rata Shares of such Advance constitutes a breach of this
Agreement.
"Nonrecourse Debt" means any Debt: (a) under the terms of which
the payee's remedies upon the occurrence of a default are limited to specific,
identified assets of the payor which secure such Debt; and (b) for the repayment
of which the payor has no personal liability beyond the loss of such specified
assets, except for liability for fraud, material misrepresentations or misuse or
misapplication of insurance proceeds, condemnation awards or rents, existence of
hazardous waste or other customary exceptions to nonrecourse provisions.
"Note" means the promissory note made by Borrower to a Lender
evidencing the Advances under that Lender's Pro Rata Share of the Commitment,
either as originally executed or as the same may from time to time be
supplemented, modified,
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amended, renewed, extended or supplanted. The Notes shall be substantially in
the form of Exhibit E.
"Notice of Borrowing" means, with respect to a proposed Advance
pursuant to Section 2.1(b), a notice substantially in the form of Exhibit F.
"Obligations" means all present and future obligations of every
kind or nature of Borrower at any time and from time to time owed to Agent or
the Lenders or any one or more of them, under any one or more of the Loan
Documents, whether due or to become due, matured or unmatured, liquidated or
unliquidated, or contingent or noncontingent, including obligations of
performance as well as obligations of payment, and including interest that
accrues after the commencement of any proceeding under any Debtor Relief Law by
or against Borrower.
"Officer's Certificate" means a certificate signed by a
specified officer of a Person certifying as to the matters set forth therein.
"Original Credit Agreement" means that certain Revolving Credit
Agreement, dated as of December 3, 1998, by and between Borrower, as borrower,
and Xxxxx Fargo, as a Lender, and Xxxxx Fargo as Agent, as amended by that
certain First Amendment to Revolving Credit Agreement and Loan Documents, dated
as of December 28, 1998, and entered into by and among Borrower, and Xxxxx
Fargo, Bank One, Arizona, NA, and AmSouth Bank, as Lenders, and Xxxxx Fargo, as
Agent.
"Original Lenders" means the "Lenders" as defined in the
Original Credit Agreement.
"Original Loan" means the "Advances" (as defined in the Original
Credit Agreement) made under the Original Credit Agreement.
"Original Loan Documents" means the "Loan Documents" as defined
in the Original Credit Agreement.
"Original Notes" means the "Notes" as defined in the Original
Credit Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation or any
Person succeeding to the functions thereof.
"Permit" means any permit, approval, authorization, license,
variance or permission required from a Governmental Authority under an
applicable Requirement of Law.
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"Permitted Liens" mean:
(a) Liens (other than Environmental Liens and any Lien imposed
under ERISA) for taxes, assessments or charges of any Governmental
Authority or claims not yet due and any such taxes, assessments, charges
or claims which are due if they are being contested by Borrower in
accordance with Section 6.4;
(b) Liens (other than any Lien imposed under ERISA) incurred or
deposits made in the ordinary course of business (including without
limitation surety bonds and appeal bonds) in connection with workers'
compensation, unemployment insurance and other types of social security
benefits or to secure the performance of tenders, bids, leases,
contracts (other than for the repayment of Indebtedness), and statutory
obligations;
(c) Liens imposed by laws, such as mechanics' liens and other
similar liens arising in the ordinary course of business which secure
payment of obligations not more than thirty (30) days past due or are
being contested as permitted under this Agreement; and
(d) any Liens which are approved by Requisite Lenders.
"Person" means any natural person, corporation, limited
partnership, general partnership, joint stock company, limited liability
company, limited liability partnership, joint venture, association, company,
trust, bank, trust company, land trust, business trust or other organization,
whether or not a legal entity, or any other nongovernmental entity, or any
Governmental Authority.
"Plan" means an employee benefit plan defined in Section 3(3) of
ERISA (other than a Multiemployer Plan) in respect of which Borrower or an ERISA
Affiliate, as applicable, is an "employer" as defined in Section 3(5) of ERISA.
"Preferred Stock" means Borrower's 8-3/4% Series A Cumulative
Redeemable Preferred Stock, par value $0.0001 per share.
"PREN Representatives" means Xxxx XxXxxxx, Xxxxx X. Xxxxx, Xxxxx
X. Xxxxxx, any other individual who is an owner of Preferred Stock and is not
affiliated with Excel Legacy Corporation or any Affiliate of Excel Legacy
Corporation (as reasonably determined by Agent) and any other individual who is
approved by Agent as a PREN Representative.
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"Price Adjustment Date" has the meaning given to such term in
Section 2.4(h)(iii).
"Price Enterprises LP" means Price Enterprises - Texas, L.P., a
Delaware limited partnership
"Price Enterprises Security Agreement" means that certain
Security Agreement dated as of December 3, 1998, and executed by Borrower and
Price Enterprises - TX, Inc., a Delaware corporation, in favor of Agent.
"Price Self Storage" means Price Self-Storage, Inc., a Delaware
corporation.
"Pricing Certificate" means a certificate in the form of Exhibit
G, properly completed and signed by the chief financial officer, chief executive
officer or chief operating officer of Borrower. Each Pricing Certificate shall
be in such detail and contain such supporting information as Agent may
reasonably require.
"Pricing Period" means the period commencing on the Closing Date
and ending on March 15, 2000, and, thereafter, (a) a period commencing on each
March 16 and ending on the next following June 15, (b) a period commencing on
each June 16 and ending on the next following September 15, (c) a period
commencing on each September 16 and ending on the next following December 15 and
(d) a period commencing on each December 16 and ending on the next following
March 15.
"Pro Forma Debt Service" means, as of the date of determination,
the aggregate annual payments of principal and interest that would be required
with respect to a loan with a principal amount equal to the sum of the
outstanding principal balance of the Advances plus all other unsecured Debt on
such date, where (a) monthly principal and interest payments are calculated
based on a 25-year amortization period with equal monthly installments of
principal and interest and (b) interest accrues on such loan at a rate per annum
equal to the greater of (i) the Treasury Base Rate plus 1.75% or (ii) the rate
at which the last Advance for which an interest rate has been set is then
bearing interest.
"Pro Rata Share" means, with respect to each Lender, the
percentage of the Commitment set forth opposite the name of that Lender on
Schedule 1.1, as such percentage may be increased or decreased pursuant to an
Assignment and Assumption executed in accordance with Section 12.20.
"Proceedings" means, collectively, all actions, suits and
proceedings before, and investigations commenced or
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threatened by or before, any court or Governmental Authority
with respect to a Person.
"Property" means, as to any Person, any real or personal
property, building, facility, structure, equipment or unit, or other asset owned
and operated by such Person in the ordinary course of its business.
"Property Information" means the following information and
other items with respect to any Real Property which Borrower intends to
designate as an Unencumbered Asset to be added to the Unencumbered Pool and with
respect to each Real Property which is included in the Unencumbered Pool:
(i) A physical description of such Real Property, the
date upon which such Real Property was acquired by Borrower, the
Acquisition Price of such Real Property, a copy of the purchase
agreement pursuant to which Borrower acquired such Real Property, an
appraisal of such Real Property (if available to Borrower), if the
building located on such Real Property or the use of such building or
buildings does not conform to applicable zoning ordinances and laws, a
description of such non conformity and whether such building or
buildings or use is a legal nonconforming use, a copy of any reports
delivered to Borrower with respect to the structural integrity of
improvements located on such Real Property, Borrower's budget for
capital expenditures for such Real Property for the next succeeding four
(4) Fiscal Quarters and market data;
(ii) A current operating statement for such Real
Property, audited or certified by Borrower as being true and correct in
all material respects and prepared in accordance with GAAP, and
comparative operating statements for the current interim fiscal period
and for the previous two (2) Fiscal Years (or such lesser period as it
has been operating); provided, however, that, if Borrower shall have
owned such Real Property for less than the period to be covered by such
operating statements and comparative operating statements, then the
audit and certification requirements shall extend only to the period of
ownership by Borrower, and Borrower shall provide to Agent complete
copies of any operating statements prepared by former owner(s) of such
Real Property with respect to the remainder of the periods required
hereunder, if the same are available to Borrower;
(iii) Cash flow projections for such Real Property for
the next succeeding four (4) Fiscal Quarters;
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(iv) A current Rent Roll for such Real Property,
certified by Borrower as being true and correct;
(v) A "Phase I" environmental assessment of such Real
Property not more than twelve (12) months old, prepared by an
environmental engineering firm reasonably acceptable to Agent;
(vi) Copies of all Major Agreements affecting such Real
Property;
(vii) Copies of all insurance policies covering such
Real Property or certificates of such insurance;
(viii) A copy of Borrower's most recent Owner's Policy
of Title Insurance covering such Real Property, together with a
preliminary title report covering such Real Property dated no earlier
than a date 30 days prior to the date that such preliminary title report
is delivered to Agent;
(ix) A structural inspection report for such Real
Property; and
(x) Such other information and materials with respect to
such Real Property as Agent may reasonably request.
"Property NOI" means, for any Real Property (including, without
limitation, any Retail Property) for any fiscal period, the net operating income
generated by such Real Property for such period determined in accordance with
GAAP (excluding depreciation and amortization), and adjusted by subtracting
therefrom the Replacement Reserve Amount for such Real Property for such period.
"Rated Tenant" means a tenant of Real Property which is a
corporation with senior long-term unsecured debt obligations which are rated at
least BB- by Standard & Poor's or at least an equivalent rating by Xxxxx'x
Investors Service, Inc.
"Rating Notice" means written notice from Borrower to Agent
delivered during the period commencing on the first day of a Fiscal Quarter and
ending on the 45th day of such Fiscal Quarter and certifying that, as of the
last day of the Fiscal Quarter most recently ended, (i) Borrower's long-term
unsecured senior Debt was rated by Standard & Poor's (and setting forth such
rating and certifying thereto), (ii) Borrower's long-term unsecured senior Debt
was rated by Xxxxx'x Investors Service, Inc. (and setting forth such rating and
certifying thereto) and (iii) the lower of such ratings was BBB- (which is a
Standard &
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Poor's rating or its equivalent by Xxxxx'x Investors Service, Inc.) or higher.
"Real Property" means each lot or parcel (or portions thereof)
of real property, together with the improvements and fixtures thereon and
appurtenances thereto now or hereafter owned in fee by the Borrower or any
Consolidated Entity.
"Regulations T, U and X" mean such Regulations of the Federal
Reserve Board as in effect from time to time.
"Release" means the release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the indoor or outdoor environment or into or out of any Real Property, including
the movement of Contaminants through or in the air, soil, surface water,
groundwater or property.
"Remedial Action" means any action required by applicable
Environmental Laws to (a) clean up, remove, treat or in any other way address
Contaminants in the indoor or outdoor environment; (b) prevent the Release or
threat of Release or minimize the further Release of Contaminants so they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment; or (c) perform pre-remedial studies and
investigations and post-remedial monitoring and care.
"Rent Roll" means, with respect to any Real Property, a rent
roll for such Real Property stating for each tenancy within such Real Property
the identity of the lessee, the suite designation of the space leased, the gross
leasable area included within such space, the date of commencement and the date
of termination of such tenancy, the periods of any options to extend or
terminate such tenancy, the base rent and any escalations or operating expense
reimbursement payable in respect of such tenancy, the type of lease (i.e., gross
or degree to which net of expenses, taxes and other items) and whether such
lease contains an option to purchase and/or a right of first refusal.
"Replacement Reserve Amount" means, with respect to any Real
Property, a normalized annual reserve for recurring capital expenditures which
reserve shall initially be at the rate of $0.10 per year per square foot of
gross leasable area of such Real Property. Such rate may be adjusted by the
Agent, based on the actual experienced rate of capital expenditures incurred by
Borrower with respect to the applicable Real Properties during 1999 and prior
years, provided that such rate shall not, in any event, be adjusted below $0.10
per year per square foot of gross leasable area of such Real Property.
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"Reportable Event" means any of the events described in Section
4043(c) of ERISA, other than an event for which the thirty (30) day notice
requirement is waived by regulations.
"Requirements of Law" means, as to any Person, the charter and
by-laws, partnership agreement or other organizational or governing documents
of such Person, and any law, rule or regulation, Permit, or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject, including without limitation, the Securities
Act, the Securities Exchange Act, Regulations T, U and X, FIRREA and any
certificate of occupancy, zoning ordinance, building, environmental or land use
requirement or Permit or occupational safety or health law, rule or regulation.
"Requisite Lenders" means, as of any date of determination,
collectively, Agent and Lenders whose Pro Rata Shares, in the aggregate, are at
least sixty-six and two-thirds percent (66-2/3%), provided that, in determining
such percentage at any given time, all then existing Defaulting Lenders will be
disregarded and excluded and the Pro Rata Shares of Lenders shall be
redetermined, for voting purposes only, to exclude the Pro Rata Shares of such
Defaulting Lenders.
"Responsible Official" means those individuals referenced on
Schedule 2.2.
"Retail Property" means any Real Property occupied by Retail
Tenants and shall include shopping centers occupied primarily (as reasonably
determined by Agent) by Retail Tenants, provided that such shopping centers may
include, in addition to Retail Tenants, movie theaters, banks and office uses of
the type commonly located in shopping centers.
"Retail Tenants" means any Person engaged in the sale of
merchandise directly to consumers. "Retail Tenants" shall not include any Person
engaged primarily in the sale of pornography or services to consumers, such as
health clubs, bowling alleys and such other similar uses as Agent may reasonably
designate.
"Securities" means any stock, shares, voting trust certificates,
bonds, debentures, notes or other evidences of indebtedness, secured or
unsecured, convertible, subordinated or otherwise, or in general any instruments
commonly known as "securities", or any certificate of interest, shares, or
participations in temporary or interim certificates for the purchase or
acquisition of, or any right to subscribe to, purchase or acquire any of the
foregoing, but shall not include any evidence of the Obligations, provided that
Securities shall
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not include Cash Equivalents, Investment Mortgages or equity investments in
Unconsolidated Joint Ventures.
"Securities Act" means the Securities Act of 1933, as amended to
the date hereof and from time to time hereafter, and any successor statute.
"Securities Exchange Act" means the Securities Exchange Act of
1934, as amended to the date hereof and from time to time hereafter, and any
successor statute.
"Senior Loans" has the meaning given to such term in Section
11.11(b).
"Solvent" means as to any Person at the time of determination,
that such Person (a) owns Property the value of which (both at fair valuation
and at present fair saleable value) is greater than the amount required to pay
all of such Person's liabilities (including the probable amount of contingent
liabilities and debts); (b) is able to pay all of its debts as such debts mature
(including through refinancing on commercially reasonable terms); and (c) has
capital sufficient to carry on its business and transactions and all business
and transactions in which it is about to engage.
"Speculative Development" means the development by Borrower or
any Consolidated Entity of improvements to Land where Borrower or such
Consolidated Entity commences construction of such improvements, or enters into
any Contractual Obligation to construct or finance such improvements, prior to
leasing 70% or more of the space within such improvements to Persons (who are
not Affiliates of Borrower or Excel Legacy Corporation) who are unconditionally
committed to occupy such improvements and commence paying rent upon the
completion of such improvements.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies.
"Stock Acquisition Costs and Expenses" means the costs and
expenses incurred by Borrower in connection with the acquisition of the common
stock of Borrower by Excel Legacy Corporation. For purposes of this Agreement,
the Stock Acquisition Costs and Expenses shall be deemed to be $1,819,000.
"Stockholder Agreement" means that certain Agreement, dated May
12, 1999, made and entered into between Excel Legacy Corporation and certain
shareholders of Borrower.
"Stockholders' Equity" means, as of any date of determination
and with respect to any Person, the consolidated
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stockholders' equity of the Person as of that date determined in accordance with
GAAP; provided that there shall be excluded from Stockholders' Equity any amount
attributable to Disqualified Stock.
"Stock Pledge Agreement" means that certain Pledge Agreement,
dated as of December 3, 1998, made by Borrower in favor of Agent and in favor of
each of the Lenders.
"Subsidiary" means, as of any date of determination and with
respect to any Person, any corporation, limited liability company or partnership
(whether or not, in either case, characterized as such or as a "joint venture"),
whether now existing or hereafter organized or acquired: (a) in the case of a
corporation or limited liability company, of which a majority of the Securities
having ordinary voting power for the election of directors or other governing
body (other than Securities having such power only by reason of the happening of
a contingency) are at the time beneficially owned by such Person and/or one or
more Subsidiaries of such Person, or (b) in the case of a partnership, of which
a majority of the partnership or other ownership interests are at the time
beneficially owned by such Person and/or one or more of its Subsidiaries.
"Swap Agreement" means a written agreement between Borrower and
one or more financial institutions providing for "swap", "cap", "collar",
"floor," "buy down" or other interest rate protection with respect to any
Indebtedness.
"Tangible Net Worth" means, as of the last day of any Fiscal
Quarter, the net worth of Borrower and the Consolidated Entities, on a
consolidated basis, as determined in accordance with GAAP, minus Intangible
Assets of Borrower and the Consolidated Entities (to the extent such Intangible
Assets were included in the foregoing net worth of Borrower and the Consolidated
Entities).
"Tax Expense" means (without duplication), for any period, total
tax expense (if any) attributable to income and franchise taxes based on or
measured by income, whether paid or accrued, of the Borrower and the
Consolidated Entities, including the Borrower's and each Consolidated Entity's
pro rata share of tax expenses in each Unconsolidated Joint Venture. For
purposes of this definition, the Borrower's and such Consolidated Entity's pro
rata share of any such tax expense of such Unconsolidated Joint Venture shall be
deemed equal to the product of (i) such tax expense of such Unconsolidated Joint
Venture, multiplied by (ii) the percentage of the total outstanding Capital
Stock of such Unconsolidated Joint Venture held by the Borrower or such
Consolidated Entity, expressed as a decimal.
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"Termination Event" means (a) any Reportable Event, (b) the
withdrawal of a Person or an ERISA Affiliate of such Person from a Benefit Plan
during a plan year in which it was a "substantial employer" as defined in
Section 4001(a)(2) of ERISA, (c) the occurrence of an obligation arising under
Section 4041 of ERISA of a Person or an ERISA Affiliate of such Person to
provide affected parties with a written notice of an intent to terminate a
Benefit Plan in a distress termination described in Section 4041(c) of ERISA,
(d) the institution by the PBGC of proceedings to terminate any Benefit Plan
under Section 4042 of ERISA, (e) any event or condition which constitutes
grounds under Section 4042 of ERISA for the appointment of a trustee to
administer a Benefit Plan, (f) the partial or complete withdrawal of such Person
or any ERISA Affiliate of such Person from a Multiemployer Plan, or (g) the
adoption of an amendment by any Person or any ERISA Affiliate of such Person to
terminate any Benefit Plan.
"Total Liabilities" means, at any time, without duplication, the
aggregate amount of (i) all Indebtedness and other liabilities of the Borrower
and the Consolidated Entities reflected in the financial statements of the
Borrower or disclosed in the financial notes thereto, plus (ii) all liabilities
of all Unconsolidated Joint Ventures that are recourse to the Borrower or any
Consolidated Entity or any of its assets or that otherwise constitute
Indebtedness of the Borrower or any Consolidated Entity, plus (iii) the
Borrower's and each Consolidated Entity's pro rata share of all Indebtedness
and other liabilities of any Unconsolidated Joint Venture not otherwise
constituting Indebtedness of the Borrower or such Consolidated Entity, plus (iv)
all Guaranty Obligations of the Borrower and the Consolidated Entities. For
purposes of clause (iii), the Borrower's and such Consolidated Entity's pro rata
share of all Indebtedness and other liabilities of any Unconsolidated Joint
Venture shall be deemed equal to the product of (a) such Indebtedness or other
liabilities, multiplied by (b) the percentage of the total outstanding Capital
Stock of such Person held by the Borrower or such Consolidated Entity, expressed
as a decimal.
"to the best knowledge of" means, when modifying a
representation, warranty or other statement of any Person, that the fact or
situation described therein is known by the Person (or, in the case of a person
other than a natural person, known by a Responsible Official of that Person)
making the representation, warranty or other statement, or with the exercise of
reasonable due diligence under the circumstances (in accordance with the
standard of what a reasonable Person in similar circumstances would have done)
would have been known by the Person (or, in the case of a Person other than a
natural Person, would have been known by a Responsible Official of that Person).
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"Treasury Base Rate" means, as of any date of determination, (a)
the rate of interest per annum equal to the yield (adjusted to constant
maturity) on such date of the U.S. Treasury Security maturing on the ten
(10)-year anniversary of such date, provided that, if there shall be more than
one U.S. Treasury Security maturing on the ten (10)-year anniversary of such
date, the Treasury Base Rate shall equal the average of the yields (adjusted to
constant maturity and expressed as a rate per annum) of such U.S. Treasury
Securities, or (b) if no U.S. Treasury Security matures on the ten (10)-year
anniversary of such date, the rate of interest per annum determined by
interpolation between (i) the yield (adjusted to constant maturity and expressed
as a rate per annum) of the U.S. Treasury Security having a maturity as close as
possible to, but after, the ten (10)-year anniversary of such date, and (ii) the
yield (adjusted to constant maturity and expressed as a rate per annum) of the
U.S. Treasury Security having a maturity as close as possible to, but before,
the ten (10)-year anniversary of such date.
"Unconsolidated Joint Venture" means any Joint Venture of the
Borrower or any Consolidated Entity in which the Borrower or such Consolidated
Entity holds any Capital Stock but which would not be combined with the Borrower
in the consolidated financial statements of the Borrower in accordance with
GAAP.
"Unencumbered Asset" means any Real Property designated by
Borrower that satisfies all of the following conditions:
(i) is a Retail Property;
(ii) is free and clear of any Lien, other than (a) easements,
covenants, and other restrictions, charges or encumbrances not securing
Indebtedness that do not interfere materially with the ordinary operations of
such Real Property and do not materially detract from the value of such Real
Property; (b) building restrictions, zoning laws and other Requirements of
Law,(c) leases and subleases of such Real Property in the ordinary course of
business (which shall not include any ground lease), and (d) Permitted Liens;
(iii) is Wholly-Owned;
(iv) such Real Property is not less than 85% leased (measured by
rentable square feet) by Persons that (A) are not an Affiliate of Borrower or an
Affiliate of Excel Legacy Corporation, (B) are in possession of such Real
Property and open for business and operating their respective businesses from
such Real Property and (C) are no more than 30 days in
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default for nonpayment of Base Rent under their respective leases.
(v) Such Real Property shall be in good condition and repair and
contain no structural defects;
(vi) Such Real Property does not contain any Contaminants;
(vii) If such Real Property is added to the Unencumbered Pool,
(A) except as otherwise provided in Section 8.10(a), no more than twenty-five
percent (25%) of Gross Revenue for the Fiscal Quarter immediately following the
Fiscal Quarter during which such Real Property is added to the Unencumbered Pool
will be derived from one Person who is a tenant of one or more Real Properties
within the Unencumbered Pool and/or Affiliates of such Person, (B) no more than
fifteen percent (15%) of Gross Revenue for the Fiscal Quarter immediately
following the Fiscal Quarter during which such Real Property is added to the
Unencumbered Pool will be derived from restaurants, (C) no less than forty
percent (40%) of Gross Revenue for the Fiscal Quarter immediately following the
Fiscal Quarter during which such Real Property is added to the Unencumbered Pool
will be derived from Rated Tenants and (D) no less than twenty-five percent
(25%) of Gross Revenue for the Fiscal Quarter immediately following the Fiscal
Quarter during which such Real Property is added to the Unencumbered Pool will
be derived from Credit Tenants; and
(viii) The Real Property has been expressly approved by
Requisite Lenders in writing as an Unencumbered Asset as provided in Section
9.1.
"Unencumbered Asset Pool Value" means, as of the last day of
each Fiscal Quarter, the aggregate dollar amount equal to the sum of each of the
amounts obtained by dividing (a) the Annualized Property NOI for each Real
Property in the Unencumbered Pool for the fiscal period consisting of that
Fiscal Quarter and the three immediately preceding Fiscal Quarters, by (b) 10%.
"Unencumbered Pool" means the pool of Unencumbered Assets
designated pursuant to Article 9.
"Unencumbered Pool Statements" has the meaning given to such
term in Section 5.1(f).
"Unmatured Event Of Default" means an event which, with the
giving of notice or the lapse of time, or both, would constitute an Event of
Default.
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"Unsecured Indebtedness" means Debt that is not secured by any
Lien and includes, without limitation, outstanding Advances.
"Unsecured Interest Expense Coverage Ratio" means, as of the
last day of each Fiscal Quarter, the ratio of (i) Property NOI of all
Unencumbered Assets for the fiscal period consisting of that Fiscal Quarter and
the three immediately preceding Fiscal Quarters, to (ii) the portion of Interest
Expense that is attributable to Unsecured Indebtedness for such fiscal period.
"Unused Facility Fee" has the meaning given to such term in
Section 2.5(b).
"U.S. Treasury Security" means, as of any date of determination,
each of the U.S. Treasury Notes and Bonds having the applicable maturities and
yields to maturity (a) as reported at the close of business on such date on the
Bloomberg Financial Market Information Service or, if not available, any other
nationally recognized trading screen reporting on-line intraday trading in U.S.
Treasury Securities, or (b) if such on-line trading screen service is not
available, then as set forth in the most recent Federal Reserve Board
Statistical Release. If there is more than one issuance date associated with the
U.S. Treasury Securities which mature on the ten (10)-year anniversary of such
date and for which the yield to maturity is set forth, then a yield to maturity
for the most recent issuance date associated with such maturity shall be used
for purposes of determining the Treasury Base Rate and if, for any particularly
maturity in the most recent issuance date associated with such U.S. Treasury
Securities that is set forth on such on-line trading screen or Federal Reserve
Board Statistical Release, more than one yield to maturity is set forth therein,
then the average yield associated with such maturity and the applicable issuance
date shall be used for purposes of determining the Treasury Base Rate.
"Wholly-Owned" means, with respect to any Real Property, that
title to such Real Property is held in fee directly by the Borrower or any
wholly-owned Subsidiary of Borrower.
1.2 Use of Defined Terms. Any defined term used in the plural shall
refer to all members of the relevant class, and any defined term used in the
singular shall refer to any one or more of the members of the relevant class.
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1.3 Terms.
(a) Any accounting terms used in this Agreement which are not
specifically defined shall be construed in conformity with, and all financial
data required to be submitted by this Agreement shall be prepared in conformity
with, GAAP, except as otherwise specifically prescribed in this Agreement.
(b) In each case where the consent or approval of Agent, all
Lenders and/or Requisite Lenders is required, or their non-obligatory action is
requested by Borrower, such consent, approval or action shall be in the sole and
absolute discretion of Agent and, as applicable, each Lender, unless otherwise
specifically indicated.
(c) Any reference herein to "Borrower and its Subsidiaries" or
the like shall refer solely to Borrower during such times, if any, as Borrower
shall have no Subsidiaries.
(d) Any time the word "or" is used herein, unless the context
otherwise clearly requires, it has the inclusive meaning represented by the
phrase "and/or". The words "hereof", "herein", "hereby", "hereunder" and similar
terms refer to this Agreement as a whole and not to any particular provision of
this Agreement. Article, section, subsection, clause, exhibit and schedule
references are to this Agreement unless otherwise specified. Any reference in
this Agreement to this Agreement or to any other Loan Document includes any and
all amendments, modifications, supplements, renewals or restatements thereto or
thereof, as applicable.
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ARTICLE 2
ADVANCES
2.1 Loan Advances and Repayment.
(a) Loan Availability.
(i) Subject to the terms and conditions set forth in
this Agreement, Lenders hereby agree to make Advances to Borrower from
time to time during the period from the Closing Date to the Business Day
next preceding the Maturity Date, subject to the following:
(w) the aggregate principal amount of all
outstanding Advances shall not at any time exceed One
Hundred Twenty-Five Million Dollars ($125,000,000);
(x) the aggregate principal amount of all
outstanding Advances shall not at any time exceed the
lesser of (1) the Commitment or (2) the amount which,
when combined with all components of the unsecured Total
Liabilities of Borrower and the Consolidated Entities
other than outstanding Advances and Guaranty Obligations
with respect thereto as of the date of determination, is
equal to fifty percent (50%) of the Unencumbered Asset
Pool Value as of such date;
(y) the aggregate principal amount of all
outstanding Advances shall not at any time exceed an
amount which would cause aggregate Annualized Property
NOI for all Real Properties in the Unencumbered Pool to
be less than 160% of Pro Forma Debt Service; and
(z) The aggregate principal amount of all
outstanding Construction Advances shall not at any time
exceed the lesser of (1) one-half of the Commitment or
(2) $25,000,000.
All Advances under this Agreement shall be made by Lenders
simultaneously and proportionately to their respective Pro Rata Shares.
Borrower acknowledges and agrees that neither the Agent nor any Lender
shall be responsible for any failure by any other Lender to perform its
obligation to make an Advance hereunder and that the Pro Rata Share of
the Commitment of any Lender shall not be increased or decreased as a
result of the failure by any other Lender to perform its obligation to
make an Advance. Advances
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may be voluntarily prepaid pursuant to Section 2.6(a) and, subject to
the provisions of this Agreement, any amounts so prepaid may be
reborrowed under this Section 2.1(a)(i). Interest shall accrue and be
payable on outstanding Advances as provided in Section 2.4. The
principal balance of the Advances shall be payable in full on the
Maturity Date. The obligation of Borrower to repay Advances will be
evidenced by the Notes.
(ii) If, at any time, the aggregate principal amount of
all outstanding Advances is in excess (the "Excess Amount") of the
amount permitted pursuant to Section 2.1(a)(i)(x), Section 2.1(a)(i)(y)
and/or Section 2.1(a)(i)(z), Borrower shall make a principal payment to
Agent, for the benefit of the Lenders, in an amount equal to the Excess
Amount within five (5) days after a Responsible Officer first has notice
of such excess.
(b) Notice of Borrowing.
(i) Whenever Borrower desires to borrow under this
Section 2.1, but in no event more than three (3) times during any one
(1) calendar month, Borrower shall give Agent, at Xxxxx Fargo Real
Estate Group Disbursement Center, 0000 Xxxx Xxxx Xxxxx, Xxxxx 000, Xx
Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xx. Xxxxxx Xxxxx (telephone: (310)
000-0000; telecopier: (000) 000-0000), with a copy to: Xxxxx Fargo Bank,
Real Estate Group, 000 X Xxxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000, Attention:
Xx. Xxxxx Xxxxxxxxxx, or at such other addresses as Agent shall
designate, an original or facsimile Notice of Borrowing no later than
9:00 A.M. (San Francisco time), not less than three (3) nor more than
five (5) Business Days prior to the proposed Funding Date of each
Advance. Each Notice of Borrowing shall specify (A) the Funding Date
(which shall be a Business Day) of the proposed Advance, (B) the amount
of the proposed Advance, provided that the aggregate amount of such
proposed Advance shall, if such Advance is a LIBOR Advance, equal One
Million Dollars ($1,000,000) or integral multiples of Fifty Thousand
Dollars ($50,000) in excess thereof, and provided further that the
aggregate amount of such proposed Advance shall, if such Advance is a
Base Rate Advance, be equal to Two Hundred Fifty Thousand Dollars
($250,000) or integral multiples of Ten Thousand Dollars ($10,000) in
excess thereof, (C) whether the Advance to be made thereunder will be a
Base Rate Advance or a LIBOR Advance and, if a LIBOR Advance, the
Interest Period, (D) the proposed use of such Advance and (E) whether
all or any portion of the proceeds of such Advance will constitute a
Construction Advance. If all or any portion of any Advance constitutes a
Construction Advance, the Notice of Borrowing with respect
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to such Advance shall be accompanied by a cost breakdown with respect to
the use of such Construction Advance in such detail as Agent may
reasonably require, a project description, a proforma income statement,
copies of executed leases (if any), a sources and uses of funds
statement and such other materials and information as Agent may
reasonably require with respect to such Construction Advance and the
Real Property to be improved with such Construction Advance. Any Notice
of Borrowing pursuant to this Section 2.1(b) shall be irrevocable.
(ii) Borrower may elect (A) to convert LIBOR Advances or
any portion thereof into Base Rate Advances, or (B) to convert Base Rate
Advances or any portion thereof to LIBOR Advances, or (C) to convert
LIBOR Advances or any portion thereof into new LIBOR Advances, provided,
however, that the aggregate amount of the Advances being converted into
or continued as LIBOR Advances at any time shall, in the aggregate,
equal One Million Dollars ($1,000,000) or an integral multiple of Fifty
Thousand Dollars ($50,000) in excess thereof. The conversion of a LIBOR
Advance to a Base Rate Advance or to a new LIBOR Advance shall only
occur on the last Business Day of the Interest Period relating to such
LIBOR Advance. Each election under clause (B) above shall be made by
Borrower giving Agent an original or facsimile Notice of Borrowing no
later than 9:00 A.M. (San Francisco time), not less than three (3) nor
more than five (5) Business Days prior to the date of proposed
conversion to a LIBOR Advance. Each election under clause (A) or clause
(C) above shall be made by Borrower giving Agent an original or
facsimile Notice of Borrowing no later than 9:00 A.M. (San Francisco
time), not less than three (3) nor more than five (5) Business Days
prior to the last day of the Interest Period for the LIBOR Advance in
question. Each Notice of Borrowing delivered pursuant to this Section
2.1(b)(ii) shall specify (1) the amount of the new LIBOR Advance or Base
Rate Advance, as the case may be, (2) with respect to a new LIBOR
Advance, the Interest Period therefor, and (3) the date of the
effectiveness of the LIBOR Rate or Base Rate, as the case may be (which
date shall be a Business Day).
(iii) Upon receipt of a Notice of Borrowing in proper
form requesting LIBOR Advances under subparagraph (i) or (ii) above,
Agent shall deliver a copy thereof (by facsimile) to each Lender by noon
(San Francisco time) on the same day of Agent's receipt thereof and
shall determine the LIBOR Rate applicable to the Interest Period for
such LIBOR Advances, and shall, two (2) Business Days prior to the
beginning of such Interest Period, give (by facsimile) a Fixed Rate
Notice
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in respect thereof to Borrower and Lenders; provided, however, that
failure to give such notice to Borrower shall not affect the validity of
such rate. Each determination by Agent of the LIBOR Rate shall be
conclusive and binding upon the parties hereto in the absence of
manifest error.
(iv) If Borrower does not make a timely election to
convert all or a portion of a LIBOR Advance into a new LIBOR Advance in
accordance with Section 2.1(b)(ii), such LIBOR Advance shall be
automatically converted to a Base Rate Advance upon expiration of the
Interest Period applicable to such LIBOR Advance.
(c) Making of Advances. Subject to Section 11.10 or as otherwise
provided herein, Agent shall deposit the proceeds of each new Advance in
Borrower's account number 4443-283155 at the San Diego main office of Agent.
(d) Term. The outstanding balance of the Advances shall be
payable in full on the earliest to occur of, (i) December 14, 2001, (ii) the
acceleration of the Advances pursuant to Section 10.2, or (iii) Borrower's
written notice to Agent (pursuant to Section 2.8) of Borrower's election to
prepay all accrued Obligations and terminate the Commitment (said earliest date
referred to herein as the "Maturity Date").
(e) Principal Payments. Within ten (10) days after Borrower's
receipt of any Net Offering Proceeds, Borrower shall make a principal payment on
the outstanding principal balance of the Advances to Agent in an amount equal to
the lesser of (i) such outstanding principal balance or (ii) the amount of such
Net Offering Proceeds.
(f) Original Loan.
(i) Effective as of the Closing Date, the Original
Credit Agreement and the Original Notes are hereby amended and restated
in full by this Agreement and the Notes and all Advances outstanding
under the Original Credit Agreement shall be deemed Advances outstanding
under this Agreement. On the Closing Date, the Original Notes shall be
canceled and promptly thereafter returned to Borrower. Without limiting
the generality of the foregoing, effective as of the Closing Date, the
commitment to disburse the undisbursed portion of the Original Loan
shall automatically terminate, and Borrower acknowledges and agrees
that, effective as of the Closing Date, no Original Lender (or any
Lender) shall have any further obligation to Borrower under the Original
Credit Agreement or the Original Notes. Effective as of the
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Closing Date, all references in any Loan Document to the "Credit
Agreement", the "Loan Agreement", the "Loan Documents" and to any Loan
Document shall mean this Agreement, the Loan Documents and such Loan
Document, respectively, as modified and amended by this Agreement.
(ii) On February 16, 2000, certain of the Lenders shall
purchase, and certain of the Lenders shall sell, to one another, the
percentage interest in the Commitment as reflected in Schedule 2.1(e)
hereto, in order to reallocate the Carryover Principal Balance under the
Notes among the Lenders to correspond to the Pro Rata Shares of the
Lenders specified in Schedule 1.1 hereto. The applicable purchase price
payments are specified in Schedule 2.1(e) hereto and are referred to
herein as the "Adjusting Purchase Payments". The Adjusting Purchase
Payments shall be made to the Agent by the applicable purchasing Lender
by Federal Reserve wire transfer initiated by the payor no later than
8:00 a.m. California time on February 16, 2000. Upon receipt of all such
payments, the Agent shall promptly send appropriate portions thereof to
the selling Lenders by Federal Reserve wire transfer. The parties to
this Agreement acknowledge that the Adjusting Purchase Payments do not
include interest, which Borrower is obligated pursuant to the terms of
Section 6.20 to pay through and including February 16, 2000. The parties
to this Agreement acknowledge and agree that, for purposes of making the
calculations and the Adjusting Purchase Payments set forth in Schedule
2.1(e), Bank One, NA shall be deemed to have acquired, immediately prior
to the Closing Date, all of the rights, title, interest and obligations
of Bank One, Arizona, NA under the Original Credit Agreement, the
Original Note and the Original Loan Documents.
2.2 Authorization to Obtain Advances. Schedule 2.2 sets forth the names
of those employees of Borrower authorized by Borrower to sign Notices of
Borrowing, and Agent and Lenders shall be entitled to rely on such Schedule
until notified in writing by Borrower of any change(s) of the persons so
authorized. Notices of Borrowing shall be signed by any two of the employees of
Borrower set forth on Schedule 2.2. Agent shall be entitled to act on the
instructions of Persons identifying themselves as two of the Persons authorized
to execute a Notice of Borrowing, and Borrower shall be bound thereby in the
same manner as if such Persons were actually so authorized. Borrower agrees to
indemnify, defend and hold Lenders and Agent harmless from and against any and
all Liabilities and Costs which may arise or be created by the acceptance of
instructions in any Notice of Borrowing, unless caused by the gross negligence
or willful misconduct of the Person to be indemnified.
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2.3 Lenders' Accounting. Agent shall maintain a loan account (the "Loan
Account") on its books in which shall be recorded (a) the names and addresses
and the Pro Rata Shares of the Commitment of each of the Lenders, and principal
amount of Advances owing to each Lender from time to time, and (b) all Advances
and repayments of principal and payments of accrued interest, as well as
payments of fees required to be paid pursuant to this Agreement. All entries in
the Loan Account shall be made in accordance with Agent's customary accounting
practices as in effect from time to time. Monthly or at such other interval as
is customary with Agent's practice, Agent will render a statement of the Loan
Account to Borrower and will deliver a copy thereof to each Lender. Each such
statement shall be deemed final, binding and conclusive upon Borrower in all
respects as to all matters reflected therein (absent manifest error).
2.4 Interest on the Advances.
(a) Base Rate Advances. Subject to Section 2.4(d), all Base Rate
Advances shall bear interest on the daily unpaid principal amount thereof from
the date made until paid in full at a fluctuating rate per annum equal to the
Base Rate.
(b) LIBOR Advances. Subject to Sections 2.4(d) and 2.4(h), LIBOR
Advances shall bear interest on the unpaid principal amount thereof during the
Interest Period applicable thereto at a rate per annum equal to the sum of the
LIBOR Rate for such Interest Period plus the Applicable LIBOR Rate Margin (which
may change during such Interest Period). No more than six (6) LIBOR Advances
shall be outstanding at any one time. Notwithstanding anything to the contrary
contained herein and subject to the default interest provisions contained in
Section 2.4(d), if an Event of Default occurs and as a result thereof the
Commitment is terminated, all LIBOR Advances will convert to Base Rate Advances
upon the expiration of the applicable Interest Periods therefor or the date all
Advances become due, whichever occurs first.
(c) Interest Payments. Subject to Section 2.4(d), interest
accrued on all Advances shall be payable by Borrower, in the manner provided in
Section 2.6(b), in arrears on the first Business Day of the first calendar month
following the Closing Date, the first Business Day of each succeeding calendar
month thereafter, and on the Maturity Date.
(d) Default Interest. Notwithstanding the rates of interest
specified in Sections 2.4(a) and 2.4(b) and the payment dates specified in
Section 2.4(c), effective at the option of Requisite Lenders following the
occurrence and during
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the continuance of any Event of Default, the principal balance of all Advances
then outstanding and, to the extent permitted by applicable law, any interest
payments not paid when due, shall bear interest, payable upon demand, at a rate
which is five percent (5%) per annum in excess of the rate(s) of interest
otherwise payable from time to time under this Agreement. Notwithstanding
anything to the contrary in any of the other Loan Documents, all other amounts
due Agent or Lenders (whether directly or for reimbursement) under this
Agreement or any of the other Loan Documents if not paid when due, or if no time
period is expressed, if not paid within ten (10) days after demand, shall bear
interest from and after demand at the rate set forth in this Section 2.4(d).
(e) Late Fee. Borrower acknowledges that late payment to Agent
will cause Agent and Lenders to incur costs not contemplated by this Agreement.
Such costs include, without limitation, processing and accounting charges.
Therefore, if Borrower fails timely to pay any sum due and payable hereunder
through the Maturity Date, unless waived by Agent pursuant to the last sentence
of this Section 2.4(e) or by Requisite Lenders, a late charge of four percent
(4%) of any such principal payment, interest or other charge which is due hereon
and which is not paid within fifteen (15) days after such payment is due, shall
be charged by Agent (for the benefit of Lenders) and paid by Borrower for the
purpose of defraying the expense incident to handling such delinquent payment.
Borrower, Lenders and Agent agree that this late charge represents a reasonable
sum considering all of the circumstances existing on the date hereof and
represents a fair and reasonable estimate of the costs that Agent and Lenders
will incur by reason of late payment. Borrower, Lenders and Agent further agree
that proof of actual damages would be costly and inconvenient. Acceptance of any
late charge shall not constitute a waiver of the default with respect to the
overdue installment, and shall not prevent Agent from exercising any of the
other rights available hereunder or under any other Loan Document. Such late
charge shall be paid without prejudice to any other rights or remedies of Agent
or any Lender. Lenders agree that, notwithstanding the foregoing, no such late
charge shall be charged by Agent or any Lender if the outstanding Advances are
then bearing interest at the default rate of interest set forth in Section
2.4(d). Agent is hereby authorized on behalf of all Lenders, without the
necessity of any notice to, or further consent from, any Lender, to waive the
imposition of the late fees provided for in this Section 2.4(e) up to a maximum
of three (3) times per calendar year.
(f) Computation of Interest. Interest shall be computed on the
basis of the actual number of days elapsed in the period during which interest
or fees accrue and a year of three hundred sixty (360) days. In computing
interest on any
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Advance, subject to Section 2.6(b), the date of the making of the Advance shall
be included and the date of payment shall be excluded; provided, however, that
if an Advance is repaid on the same day on which it is made, one (1) day's
interest shall be paid on that Advance. Notwithstanding any provision in this
Section 2.4, interest in respect of any Advance shall not exceed the maximum
rate permitted by applicable law.
(g) Changes; Legal Restrictions. In the event that, after the
Closing Date, (i) the adoption of or any change in any law, treaty, rule,
regulation, guideline or determination of a court or Governmental Authority or
any change in the interpretation or application thereof by a court or
Governmental Authority, or (ii) compliance by Agent or any Lender with any
request or directive made or issued after the Closing Date (whether or not
having the force of law and whether or not the failure to comply therewith would
be unlawful) from any central bank or other Governmental Authority or
quasi-governmental authority:
(A) subjects Agent or any Lender to any tax, duty or
other charge of any kind with respect to the Commitment, this Agreement
or any of the other Loan Documents, including the Notes or the Advances,
or changes the basis of taxation of payments to Agent or such Lender of
principal, fees, interest or any other amount payable hereunder, except
for net income, gross receipts, gross profits or franchise taxes imposed
by any jurisdiction and not specifically based upon loan transactions
(all such non-excepted taxes, duties and other charges being hereinafter
referred to as "Lender Taxes");
(B) imposes, modifies or holds applicable, in the
determination of Agent or any Lender, any reserve, special deposit,
compulsory loan, FDIC insurance, capital allocation or similar
requirement against assets held by, or deposits or other liabilities in
or for the account of, advances or loans by, or other credit extended
by, or any other acquisition of funds by, Agent or such Lender or any
applicable lending office (except to the extent that the reserve and
FDIC insurance requirements are reflected in the "Base Rate" or in
determining the LIBOR Rate); or
(C) imposes on Agent or any Lender any other condition
materially more burdensome in nature, extent or consequence than those
in existence as of the Closing Date,
and the result of any of the foregoing is to increase the cost to Agent or any
Lender of making, renewing, maintaining or participating in the Advances or to
reduce any amount receivable thereunder; then, in any such case, Borrower shall
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promptly pay to Agent or such Lender, as applicable, within seven (7) Business
Days after Borrower's receipt of written demand, such amount or amounts (based
upon a reasonable allocation thereof by Agent or such Lender to the financing
transactions contemplated by this Agreement and affected by this Section 2.4(g))
as may be necessary to compensate Agent or such Lender for any such additional
cost incurred or reduced amounts received. Agent or such Lender shall deliver to
Borrower and in the case of a delivery by any Lender, such Lender shall also
deliver to Agent, a written statement of the claimed additional costs incurred
or reduced amounts received and the basis therefor as soon as reasonably
practicable after such Lender obtains knowledge thereof. If Agent or any Lender
subsequently recovers any amount of Lender Taxes previously paid by Borrower
pursuant to this Section 2.4(g), whether before or after termination of this
Agreement, then, upon receipt of good funds with respect to such recovery, Agent
or such Lender will refund such amount to Borrower if no Event of Default or
Unmatured Event of Default then exists or, if an Event of Default or Unmatured
Event of Default then exists, such amount will be credited to the Obligations in
the manner determined by Agent or such Lender.
(h) Certain Provisions Regarding LIBOR Advances.
(i) LIBOR Lending Unlawful. If any Lender shall
determine (which determination shall, upon notice thereof to Borrower
and Agent, be conclusive and binding on the parties hereto) that after
the Closing Date the introduction of or any change in or in the
interpretation of any law makes it unlawful, or any central bank or
other Governmental Authority asserts that it is unlawful, for such
Lender to make or maintain any Advance as a LIBOR Advance, (A) the
obligations of such Lender to make or maintain any Advances as LIBOR
Advances shall, upon such determination, forthwith be suspended until
such Lender shall notify Agent that the circumstances causing such
suspension no longer exist (and such Lender shall give notice if such
circumstances no longer exist), and (B) if required by such law or
assertion, the existing LIBOR Advances of such Lender shall
automatically convert into Base Rate Advances.
(ii) Deposits Unavailable. If Agent shall have
determined in good faith that adequate means do not exist for
ascertaining the interest rate applicable hereunder to LIBOR Advances,
then, upon notice from Agent to Borrower the obligations of all Lenders
to make or maintain Advances as LIBOR Advances shall forthwith be
suspended until Agent shall notify Borrower that the circumstances
causing such suspension no longer exist. Agent will give such notice
when it determines, in good
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faith, that such circumstances no longer exist; provided, however, that
neither Agent nor any Lender shall have any liability to any Person with
respect to any delay in giving such notice.
(iii) Fixed Rate Price Adjustment. Borrower acknowledges
that prepayment or acceleration of a LIBOR Advance during an Interest
Period shall result in Lenders incurring additional costs, expenses
and/or liabilities and that it is extremely difficult and impractical to
ascertain the extent of such costs, expenses and/or liabilities.
Therefore, on the date a LIBOR Advance is prepaid or the date all sums
payable hereunder become due and payable, by acceleration or otherwise
("Price Adjustment Date"), Borrower shall pay to Agent, for the account
of each Lender, in addition to all other sums then owing, an amount
("Fixed Rate Price Adjustment") equal to the then present value of (A)
the amount of interest that would have accrued on the LIBOR Advance for
the remainder of the Interest Period at the rate applicable to such
LIBOR Advance, less (B) the amount of interest that would accrue on the
same LIBOR Advance for the same period if the LIBOR Rate were set on the
Price Adjustment Date. The present value shall be calculated by using as
a discount rate the LIBOR Rate quoted on the Price Adjustment Date.
By initialing this provision where indicated Borrower waives any
right Borrower may have under California Civil Code Section
2954.10 to repay any LIBOR Advances, in whole or in part,
without payment of the Fixed Rate Price Adjustment upon
acceleration of the maturity date of such Advances, and Borrower
further confirms that Lenders' agreement to make LIBOR Advances
at the interest rates and on the other terms set forth herein
constitutes adequate and valuable consideration, given
individual weight by Borrower, for this waiver and agreement.
BORROWER'S INITIALS: [INITIALS]
---------------------------------
Within seven (7) Business Days after Borrower's receipt of written
notice from Agent, Borrower shall immediately pay to Agent, for the
account of Lenders, the Fixed Rate Price Adjustment as calculated by
Agent. 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.
(iv) Borrower understands, agrees and acknowledges the
following: (A) no Lender has any
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obligation to purchase, sell and/or match funds in connection with the
use of the LIBOR Rate as a basis for calculating the rate of interest on
a LIBOR Rate Advance or a Fixed Rate Price Adjustment; (B) the LIBOR
Rate is used merely as a reference in determining such rate and/or Fixed
Rate Price Adjustment; and (C) Borrower has accepted the LIBOR Rate as a
reasonable and fair basis for calculating such rate and a Fixed Rate
Price Adjustment. Borrower further agrees to pay the Fixed Rate Price
Adjustment and Lender Taxes, if any, whether or not a Lender elects to
purchase, sell and/or match funds.
(i) Withholding Tax Exemption. At least five (5)
Business Days prior to the first day on which interest or fees are payable
hereunder for the account of any Lender, each Lender that is not incorporated
under the laws of the United States of America, or a state thereof, agrees that
it will deliver to Agent and Borrower two (2) duly completed copies of United
States Internal Revenue Service Form 1001 or Form 4224, certifying in either
case that such Lender is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes. Each
Lender which so delivers a Form 1001 or Form 4224 further undertakes to deliver
to Agent and Borrower two (2) additional copies of such form (or any applicable
successor form) on or before the date that such form expires (currently, three
(3) successive calendar years for Form 1001 and one (1) calendar year for Form
4224) or becomes obsolete or after the occurrence of any event requiring a
change in the most recent forms so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by Agent or
Borrower, in each case certifying that such Lender is entitled to receive
payments under this Agreement without deduction or withholding of any United
States federal income taxes, unless an event (including without limitation any
change in treaty, law or regulation) has occurred prior to the date on which any
such delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender advises Agent that
it is not capable of receiving payments without any deduction or withholding of
United States federal income taxes. If any Lender cannot deliver such form, then
Borrower may withhold from such payments such amounts as are required by the
Code.
2.5 Fees.
(a) Commitment Fee. Borrower shall pay to Agent, solely for the
account of Agent, a commitment fee in respect of the Commitment pursuant to a
separate agreement between Agent and Borrower.
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(b) Unused Facility Fee. From and after the Closing Date and
until the Obligations are paid in full and this Agreement is terminated or, if
sooner, the date the Commitment terminates, and subject to Section 11.11(b),
Borrower shall pay to Agent, for the account of each Lender, a fee (the "Unused
Facility Fee") accruing at the "Unused Facility Fee Rate" (as that term is
hereinafter defined) upon an amount equal to (i) $100,000,000 less all
reductions in the Commitment pursuant to Section 2.7 or Section 2.8 minus (ii)
the average daily principal balance of all outstanding Advances as determined
for each Fiscal Quarter.
The Unused Facility Fee Rate shall be computed as follows:
(1) For any Fiscal Quarter in which the average daily
principal balance of all outstanding Advances is less
than or equal to fifty percent (50%) of the Commitment,
the Unused Facility Fee Rate shall be 0.20% per annum;
(2) For any Fiscal Quarter in which the average daily
principal balance of all outstanding Advances is greater
than fifty percent (50%) of the Commitment, the Unused
Facility Fee Rate shall be 0.125% per annum.
The Unused Facility Fee shall be payable, in the manner provided in Section
2.5(d), in arrears on the first Business Day in each Fiscal Quarter, beginning
with the first Fiscal Quarter after the Closing Date, and shall be payable on
the Maturity Date or, if sooner, the date the Commitment terminates. The Unused
Facility Fee shall be prorated for any period of less than a full Fiscal
Quarter.
(c) Agency Fees. Borrower shall pay Agent, solely for the
account of Agent, such fees as are provided for in the fee agreement between
Agent and Borrower, as in existence from time to time.
(d) Lender Fees. Prior to the Closing Date, Borrower shall pay
to Agent for the benefit of each Lender who is a Lender on the Closing Date
(other than BankBoston, N.A.), an aggregate fee equal to $75,000. Agent shall
deliver $25,000 of such fee to each such Lender within 10 days after the Closing
Date.
(e) Payment of Fees. The fees described in this Section 2.5
represent compensation for services rendered and to be rendered separate and
apart from the lending of money or the provision of credit and do not constitute
compensation for the use, detention or forbearance of money, and the obligation
of Borrower to pay the fees described herein shall be in addition
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to, and not in lieu of, the obligation of Borrower to pay interest, other fees
and expenses otherwise described in this Agreement. All fees shall be payable
when due in immediately available funds and shall be nonrefundable when paid. If
Borrower fails to make any payment of fees or expenses specified or referred to
in this Agreement due to Agent or Lenders, including without limitation those
referred to in this Section 2.5, in Section 12.1, or otherwise under this
Agreement or any separate fee agreement between Borrower and Agent or any Lender
relating to this Agreement, when due, the amount due shall bear interest until
paid at the Base Rate and after ten (10) days at the rate specified in Section
2.4(d) (but not to exceed the maximum rate permitted by applicable law), and
shall constitute part of the Obligations. The Unused Facility Fee shall be
calculated on the basis of a 360-day year and the actual number of days elapsed.
2.6 Payments.
(a) Voluntary Prepayments. Borrower may, upon not less than
three (3) Business Days prior written notice to Agent not later than 11:00 A.M.
(San Francisco time) on the date given, at any time and from time to time,
prepay any Advances in whole or in part. Any notice of prepayment given to Agent
under this Section 2.6(a) shall specify the date of prepayment and the aggregate
principal amount of the prepayment. In the event of a prepayment of LIBOR
Advances, Borrower shall pay any Fixed Rate Price Adjustment payable in respect
thereof in accordance with Section 2.4(h). Agent shall provide to each Lender a
confirming copy of such notice on the same Business Day such notice is received.
(b) Manner and Time of Payment. All payments of principal,
interest and fees hereunder payable to Agent or the Lenders shall be made
without condition or reservation of right and free of set-off or counterclaim,
in Dollars and by wire transfer (pursuant to Agent's written wire transfer
instructions) of immediately available funds, to Agent, for the account of each
Lender entitled thereto not later than 11:00 A.M. (San Francisco time) on the
date due; and funds received by Agent after that time and date shall be deemed
to have been paid on the next succeeding Business Day.
(c) Payments on Non-Business Days. Whenever any payment to be
made by Borrower hereunder shall be stated to be due on a day which is not a
Business Day, such payment shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the payment of
interest hereunder and of any of the fees specified in Section 2.5, as the case
may be.
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2.7 Notice of Increased Costs and Certain Provisions Regarding LIBOR
Advances. Each Lender agrees that, as promptly as reasonably practicable after
it becomes aware of the occurrence of an event or the existence of a condition
which would cause it to be affected by any of the events or conditions described
in Section 2.4(g) or (h) and in no event later than ninety (90) days after the
principal officer of such Lender responsible for administering this Agreement
for such Lender obtains knowledge thereof, it will notify Borrower, and provide
a copy of such notice to Agent, of such event and the possible effects thereof,
provided that the failure to provide notice shall not affect such Lender's
rights to reimbursement provided for herein with respect to claims arising prior
to the end of such 90-day period, but shall relieve Borrower of its obligations
under this Section 2.7 with respect to the time between the end of such
90-period and such time as Borrower receives notice from such Lender. Provided
no Event of Default or Unmatured Event of Default has occurred and is
continuing, Borrower shall have the following rights:
(a) The right (the "Payoff Right") to pay to such Lender all
principal, accrued and unpaid interest and any other amounts (collectively, the
"Payoff Amount") owing to such Lender under this Agreement and the other Loan
Documents (including amounts owing to such Lender under Section 2.4(g)).
Borrower may exercise the Payoff Right only by delivering written notice of
Borrower's exercise of such Payoff Right to such Lender, the Agent and the other
Lenders within 15 days after Borrower's receipt of written notice from such
Lender that Borrower owes amounts under Section 2.4(g) or LIBOR Advances are
being suspended or terminated pursuant to Section 2.4(h) and thereafter paying,
in immediately available funds, the Payoff Amount to such Lender within such
15-day period. Upon such Lender's receipt of the Payoff Amount, such Lender's
Pro Rata Share of the Commitment shall be terminated, the Commitment shall be
reduced by an amount equal to such Lender's Pro Rata Share of the Commitment and
the Pro Rata Shares of the Commitment of the remaining Lenders shall be adjusted
and the Agent shall give written notice to each of the Lenders of the adjusted
Pro Rata Shares; and
(b) Upon at least twenty (20) Business Days' prior irrevocable
written notice to each of such Lender and Agent, to replace the Pro Rata Share
of the Commitment of such Lender in its entirety; provided that Borrower shall
replace such Pro Rata Share of such Commitment with the Commitment of a
commercial bank reasonably satisfactory to the Agent. Such replacement Lender
shall upon the effective date of replacement purchase, pursuant to an
appropriately modified Assignment and Assumption, the Obligations owed to such
replaced Lender for the aggregate amount thereof and shall thereupon for all
purposes become a "Lender" hereunder. Such notice from
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Borrower shall specify an effective date for the replacement of such Lender's
Commitment, which date shall not be later than the twentieth (20th) day after
the day such notice is given. On the effective date of any replacement of such
Lender's Commitment pursuant to this Section 2.7, Borrower shall pay to Agent
for the account of such Lender (i) any fees due to such Lender to the date of
such replacement, (ii) accrued interest on the principal amount of outstanding
Advances held by such Lender to the date of such replacement, (iii) the amount
or amounts requested by such Lender pursuant to Section 2.4(g), as applicable
and (iv) all other amounts owing to such Lender under the Loan Documents.
Without limitation upon the foregoing, Borrower shall remain liable to such
replaced Lender for any Fixed Rate Price Adjustment. Upon the effective date of
repayment of the foregoing amounts and termination of such Lender's Commitment
pursuant to this Section 2.7, such Lender shall cease to be a Lender hereunder.
2.8 Voluntary Termination or Reduction of Commitment. At any time prior
to the Maturity Date, Borrower may, upon not less than 5 Business Days' prior
written notice to the Agent, terminate the Commitment in effect or permanently
reduce the Commitment in effect by an aggregate minimum amount of Five Million
Dollars ($5,000,000) or any multiple of One Million Dollars ($1,000,000) in
excess thereof; provided, however, that no such termination or reduction shall
be permitted if, after giving effect thereto and to any prepayment of Advances
made on the effective date of such termination or reduction, as the case may be,
the then outstanding principal amount of the Advances would exceed the
Commitment in effect; provided further, however, that once terminated or reduced
in accordance with this Section 2.8, the Commitment in effect may not thereafter
be reinstated or increased; and provided further, however, that although the
Commitment in effect may be terminated entirely pursuant to this Section 2.8,
the Commitment in effect shall not be reduced below Fifty Million Dollars
($50,000,000). All accrued and unpaid fees owing under Section 2.5 with respect
to the portion of the Commitment in effect being terminated or reduced shall be
paid to the Agent on the effective date of such termination or reduction.
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ARTICLE 3
CONDITIONS TO ADVANCES
3.1 Conditions to Initial Advances. The obligation of Lenders to make
the initial Advances shall be subject to the satisfaction, or waiver by
Requisite Lenders, of each of the following conditions precedent on or before
February 18, 2000:
(a) Borrower Loan Documents. Borrower and each Guarantor shall
have executed and delivered to Agent each of the following (to the extent such
entity is a party to such document), in form and substance acceptable to Agent
and each other Lender:
(i) this Agreement;
(ii) the Notes; and
(iii) all other documents which Agent reasonably
requires to be executed by or on behalf of Borrower.
(b) Corporate and Other Governing Documents. Agent shall have
received the corporate and other governing documents of the Borrower and each
Guarantor and a certificate of each such entity's Secretary or an officer
comparable thereto with respect to authorization, incumbency and all
organizational documents.
(c) Reserved.
(d) Fees and Expenses. Agent shall have received all fees then
due to Agent and to Lenders and shall have received reimbursement for all costs
and expenses for which Borrower is obligated pursuant to Section 12.1 and for
which Borrower has received an invoice, and Borrower shall have performed all of
its other obligations as set forth in the Loan Documents to make payments to
Agent on or before the Closing Date and all expenses of Agent incurred prior to
such Closing Date and for which Borrower has received an invoice shall have been
paid by Borrower.
(e) Opinion of Counsel. Agent shall have received, on behalf of
Agent and Lenders, favorable opinions of counsel for Borrower and each Guarantor
dated as of the Closing Date, in form and substance reasonably satisfactory to
Agent, Lenders and their respective counsel.
(f) Consents and Approvals. All material licenses, permits,
consents, regulatory approvals and corporate action necessary to enter into the
financing transactions
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contemplated by this Agreement shall have been obtained by Borrower and each
Guarantor.
3.2 Conditions Precedent to All Advances. The obligation of each Lender
to make any Advance (including the initial Advance) requested to be made by it,
on any date, is subject to the satisfaction or waiver by Requisite Lenders of
the following conditions precedent as of such date:
(a) Notice of Borrowing. With respect to a request for an
Advance, Agent shall have received, on or before the Funding Date and in
accordance with the provisions of Section 2.1(b), an original and duly executed
Notice of Borrowing.
(b) Additional Matters. As of the Funding Date for any Advance
and after giving effect to the Advance being requested:
(i) No Default. After giving effect to the requested
Advance, no Event of Default or Unmatured Event of Default shall have
occurred and be continuing or would result from the making of the
requested Advance (it being intended that Lenders shall have no
obligation to fund any Advance during the period allowed under this
Agreement for cure of any event or condition which, if not cured during
such period, would become an Event of Default), and, without limitation,
all of the covenants contained in Sections 7.5 and 7.6 and Article 8
shall be satisfied;
(ii) Representations and Warranties. All of the
representations and warranties contained in this Agreement and in any
other Loan Document (other than those representations and warranties
which expressly provide that they speak as of a certain date (e.g., "as
of the Closing Date")) shall be true and correct in all material
respects on and as of such Funding Date, as though made on and as of
such date, and Borrower shall so certify;
(iii) No Material Adverse Effect. No Material Adverse
Effect shall have occurred; and
(iv) Litigation Proceedings. There shall not have been
instituted or threatened, any litigation or proceeding in any court or
before any Governmental Authority affecting or threatening to affect
Borrower which, if adversely determined, would have a Material Adverse
Effect on Borrower, as reasonably determined by Agent.
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(v) Compliance with Section 8.3. Borrower shall be in
compliance with Section 8.3 after such Advance is made.
Each submission by Borrower to Agent of a Notice of Borrowing with respect to an
Advance and the acceptance by Borrower of the proceeds of each such Advance made
hereunder shall constitute a representation and warranty by Borrower as of the
Funding Date in respect of such Advance that all the conditions contained in
this Section 3.2 have been satisfied.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to make the Advances, Borrower hereby
represents and warrants to Agent and Lenders as follows:
4.1 Organization; Partnership Powers. Borrower (i) is a corporation duly
organized, validly existing and in good standing under the laws of Maryland,
(ii) is duly qualified to do business and in good standing under the laws of
California and each other jurisdiction in which it owns or leases real property
or in which the nature of its business requires it to be so qualified, except
for those jurisdictions where failure to so qualify and be in good standing
would not have a Material Adverse Effect on Borrower, and (iii) has all
requisite power and authority to own, operate and encumber its Property and
assets and to conduct its business as presently conducted and as proposed to be
conducted in connection with and following the consummation of the transactions
contemplated by the Loan Documents.
4.2 Authority. Borrower has the requisite corporate power and authority
to execute, deliver and perform each of the Loan Documents to which it is or
will be a party. The execution, delivery and performance thereof, and the
consummation of the transactions contemplated thereby, have been duly
authorized by all necessary actions. Each of the Loan Documents to which
Borrower is a party has been duly and validly executed and delivered by Borrower
and constitutes its legal, valid and binding obligation, enforceable against it
in accordance with its terms, subject to bankruptcy, insolvency and other laws
affecting creditors' rights generally and general equitable principles.
4.3 No Conflict. The execution, delivery and performance by Borrower of
the Loan Documents to which it is or will be a party, and each of the
transactions contemplated thereby, do not and will not (i) conflict with or
violate Borrower's articles of incorporation, bylaws or other organizational
documents, as the case may be, or (ii) conflict with, result in a breach of or
constitute (with or without notice or lapse of time or both) a default under any
Requirement of Law, Contractual Obligation or Court Order of or binding upon
Borrower, which would constitute a Material Adverse Effect or (iii) require
termination of any Contractual Obligation, which termination would constitute a
Material Adverse Effect or (iv) to the best of Borrower's knowledge, result in
or require the creation or imposition of any Lien whatsoever upon any of the
Properties or assets of Borrower (other than Permitted Liens).
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4.4 Consents and Authorizations. Borrower has obtained all consents and
authorizations required pursuant to its Contractual Obligations with any other
Person, and shall have obtained all consents and authorizations of, and effected
all notices to and filings with, any Governmental Authority, as may be necessary
to allow Borrower to lawfully execute, deliver and perform its obligations under
the Loan Documents to which Borrower is a party, except to the extent that
failure to obtain any such consent or authorization or to effect such notice or
filing would not constitute a Material Adverse Effect.
4.5 Governmental Regulation. Borrower is not subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act, the Investment Company Act of 1940 or any other federal
or state statute or regulation such that its ability to incur indebtedness is
limited or its ability to consummate the transactions contemplated by the Loan
Documents is materially impaired.
4.6 Financial Statements; Projections and Forecasts. Each of the
financial statements to be delivered to Agent pursuant to Sections 5.1(b) and
(c) (i) has been, or will be, as applicable, prepared in accordance with the
books and records of the Borrower and the Consolidated Entities on a
consolidated basis, and (ii) either fairly present in all material respects, or
will fairly present in all material respects, as applicable, the financial
condition of the Borrower and the Consolidated Entities on a consolidated basis,
at the dates thereof (and, if applicable, subject to normal year-end
adjustments) and the results of its operations and cash flows, on a consolidated
basis, for the period then ended. Each of the projections delivered to Agent
prior to the date hereof and each of the projected consolidated cash flows to be
delivered to Agent pursuant to Section 5.1(e), (A) has been, or will be, as
applicable, prepared by the Borrower in light of the past business and
performance of the Borrower on a consolidated basis and (B) represent, or will
represent, as of the date thereof, the reasonable good faith estimates of the
Borrower's financial personnel as of their respective dates.
4.7 Prior Operating Statements. Each of the operating statements
pertaining to each of the Unencumbered Assets in the Unencumbered Pool prepared
by Borrower and delivered to Agent prior to the date hereof was prepared in
accordance with GAAP in effect on the date such operating statement of each such
Unencumbered Asset was prepared and fairly presents the results of operations of
such Unencumbered Asset for the period then ended.
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4.8 Unencumbered Pool Statements and Projections. Each of the
Unencumbered Pool Statements to be delivered to Agent pursuant to Section 5.1(f)
(i) has been or will be, as applicable, prepared in accordance with the books
and records of the applicable Unencumbered Asset and (ii) fairly presents or
will fairly present in all material respects, as applicable, the results of
operations of such Unencumbered Asset for the period then ended.
4.9 Litigation; Adverse Effects.
(i) Except as otherwise disclosed on Schedule 4.9, there
is no action, suit, proceeding, governmental investigation or
arbitration, at law or in equity, or before or by any Governmental
Authority, pending or, to the best of Borrower's knowledge, threatened
against Borrower or any Property of Borrower which, if adversely
determined, would constitute a Material Adverse Effect.
(ii) Borrower is not (A) in violation of any applicable
law, which violation has a Material Adverse Effect on Borrower, or (B)
subject to or in default with respect to any Court Order which has a
Material Adverse Effect on Borrower. There are no material Proceedings
pending or, to the best of Borrower's knowledge, threatened against
Borrower or any Unencumbered Asset which, if adversely decided, would
constitute a Material Adverse Effect.
4.10 No Material Adverse Change. Since the Closing Date, (i) there has
occurred no event which would constitute a Material Adverse Effect and (ii) no
material adverse change in Borrower's ability to perform its obligations under
the Loan Documents to which it is a party or the transactions contemplated
thereby has occurred.
4.11 Payment of Taxes. All tax returns and reports to be filed by
Borrower have been timely filed, and all taxes, assessments, fees and other
governmental charges shown on such returns or otherwise payable by Borrower have
been paid when due and payable (other than real property taxes, which may be
paid prior to delinquency so long as no penalty or interest shall attach
thereto), except such taxes, if any, as are reserved against in accordance with
GAAP and are being contested in good faith by appropriate proceedings or such
taxes, the failure to make payment of which when due and payable will not
constitute, in the aggregate, a Material Adverse Effect. Borrower has no
knowledge of any proposed tax assessment against Borrower that would constitute
a Material Adverse Effect.
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4.12 Material Adverse Agreements. Borrower is not a party to or subject
to any Contractual Obligation or other restriction contained in its articles of
incorporation, bylaws or similar governing documents which would constitute a
Material Adverse Effect.
4.13 Performance. To the best of Borrower's knowledge, Borrower is not
in default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any Contractual Obligation
applicable to it, and no condition exists which, with the giving of notice or
the lapse of time or both, would constitute a default under such Contractual
Obligation, except where the consequences, direct or indirect, of such default
or defaults, if any, would not constitute a Material Adverse Effect.
4.14 Federal Reserve Regulations. The Borrower is not engaged primarily
in the business of extending credit for the purpose of purchasing or carrying
out any "margin stock" as defined in Regulation U. No part of the proceeds of
the Advances hereunder will be used for any purpose that violates, or which is
inconsistent with, the provisions of Regulation X or any other regulation of the
Federal Reserve Board.
4.15 Disclosure. The representations and warranties of Borrower
contained in the Loan Documents and all certificates, financial statements and
other documents delivered to Agent in connection therewith, do not contain any
untrue statement of a material fact or omit to state a material fact necessary,
in order to make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading; provided no
representation is made as to any information in the financial reports for any
Real Property prior to its ownership by Borrower. The factual information in any
document, certificate or written statement furnished to the Agent by or on
behalf of the Borrower or any Consolidated Entity with respect to the business,
assets, prospects, results of operations or financial condition of the Borrower
or any Consolidated Entity, including operating statements and Rent Rolls for
periods when the Real Property covered by such statements or Rent Rolls is owned
by Borrower, for use in connection with the transactions contemplated by this
Agreement, was true and correct in all material respects as of the applicable
date. There is no fact known to Borrower or any Consolidated Entity that would
constitute a Material Adverse Effect which has not been disclosed herein or in
such other documents, certificates and statements. Borrower has given to Agent
true, correct and complete copies of all Major Agreements, organizational
documents, financial statements of the Borrower and the Consolidated Entities,
Unencumbered Pool Statements and all other documents and instruments referred to
in the Loan Documents as having been delivered to Agent.
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Borrower has not intentionally withheld any material fact from Agent in regard
to any matter raised in the Loan Documents which would cause its representations
and warranties to be misleading. Notwithstanding the foregoing, with respect to
projections of Borrower's future performance such representations and warranties
are made in good faith and to the best judgment of Borrower as of the date
thereof.
4.16 Requirements of Law. The Borrower and the Consolidated Entities are
in compliance with all Requirements of Law (including without limitation the
Securities Act and the Securities Exchange Act, and the applicable rules and
regulations thereunder, state securities law and "Blue Sky" laws) applicable to
it and its respective businesses, in each case, where the failure to so comply
will have a Material Adverse Effect on any such Person. The Borrower has made
all filings with and obtained all consents of the Commission required under the
Securities Act and the Securities Exchange Act in connection with the execution,
delivery and performance by the Borrower of the Loan Documents.
4.17 Patents, Trademarks, Permits, Etc. The Borrower and the
Consolidated Entities own, are licensed or otherwise have the lawful right to
use, or have, all Permits, patents, trademarks, trade names, copyrights,
technology, know-how and processes used in or necessary for the conduct of each
such Person's business as currently conducted, the absence of which would
constitute a Material Adverse Effect. The use of such Permits, patents,
trademarks, trade names, copyrights, technology, know-how and processes by each
such Person does not infringe on the rights of any Person, subject to such
claims and infringements as do not, in the aggregate, give rise to any liability
on the part of any such Person which would constitute a Material Adverse Effect.
4.18 Environmental Matters. Except as set forth on Schedule 4.18 or in
any phase I environmental or other reports delivered to Agent, to the best
knowledge of Borrower, (i) the operations of the Borrower comply in all material
respects with all applicable, local, state and federal environmental, health-
and safety Requirements of Law ("Environmental Laws"); (ii) none of the
Unencumbered Assets or operations thereon are subject to any Remedial Action or
other Liabilities and Costs arising from the Release or threatened Release of a
Contaminant into the environment in violation of any Environmental Laws, which
Remedial Action or other Liabilities and Costs would constitute a Material
Adverse Effect; (iii) neither the Borrower nor any Consolidated Entity has filed
any notice under applicable Environmental Laws reporting a Release of a
Contaminant into the environment in violation of any Environmental Laws, except
as the same may have been heretofore remedied or otherwise would not constitute
a Material Adverse
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Effect; (iv) there is not now on or in any Unencumbered Assets (except in
compliance in all material respects with all applicable Environmental Laws): (A)
any underground storage tanks, (B) any asbestos-containing material, or (C) any
polychlorinated biphenyls (PCB's) used in hydraulic oils, electrical
transformers or other equipment owned by such Person; and (v) neither the
Borrower nor any Consolidated Entity has received any notice or claim to the
effect that it is or may be liable to any Person as a result of the Release or
threatened Release of a Contaminant into the environment which would constitute
a Material Adverse Effect.
4.19 Solvency. Borrower is and will be Solvent after giving effect to
the disbursements of the Advances and the payment and accrual of all fees then
payable.
4.20 Title to Assets. Borrower has good, indefeasible and merchantable
title to all Properties, including, without limitation, all Unencumbered Assets,
owned by it.
4.21 Management Agreements. Except as disclosed on Schedule 4.21 (as
amended from time to time), Borrower is not a party or subject to any third
party management agreement with respect to any of the Properties included within
the Unencumbered Pool.
4.22 Capitalization. All of the issued capital stock of the Borrower has
been issued in compliance in all material respects with all applicable
Requirements of Law.
4.23 ERISA. Neither the Borrower nor any ERISA Affiliate thereof
(including, for all purposes under this Section 4.23, the Consolidated Entities)
has in the past five (5) years maintained or contributed to or currently
maintains or contributes to any Benefit Plan other than the Benefit Plans
identified on Schedule 4.23 (as such Schedule may be amended from time to time).
Neither the Borrower nor any ERISA Affiliate thereof has during the past five
(5) years maintained or contributed to or currently maintains or contributes to
any employee welfare benefit plan within the meaning of Section 3(1) of ERISA
which provides benefits to retirees other than benefits required to be provided
under Section 4980B of the Code and Sections 601 through 608 of ERISA (or any
successor provisions thereto) or applicable state law. Neither the Borrower nor
any ERISA Affiliate thereof is now contributing nor has it ever contributed to
or been obligated to contribute to any Multiemployer Plan, no employees or
former employees of the Borrower, or such ERISA Affiliate, have been covered by
any Multiemployer Plan in respect of their employment by the Borrower, and no
ERISA Affiliate of the Borrower has or is likely to incur any withdrawal
liability with respect
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to any Multiemployer Plan which would have a Material Adverse Effect on the
Borrower.
4.24 Status as a REIT. Borrower (i) is a real estate investment trust as
defined in Section 856 of the Code, (ii) has not engaged in any "prohibited
transactions" as defined in Section 857(b)(6)(B)(iii) of the Code, (iii) for its
current "tax year" (as defined in the Code) is, and shall remain, entitled to a
dividends paid deduction which meets the requirements of Section 857 of the Code
and (iv) its ownership and method of operation enable it to meet the
requirements for taxation as a real estate investment trust under the Code.
4.25 NASDAQ Listing. The Preferred Stock and the common stock of the
Borrower is, and the Preferred Stock shall be, listed for trading and traded on
NASDAQ or another national securities exchange reasonably acceptable to Agent.
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ARTICLE 5
REPORTING COVENANTS
Borrower covenants and agrees that, on and after the date
hereof, until payment and performance in full of all of the Obligations, the
expiration of the Commitment and termination of this Agreement:
5.1 Financial Statements and Other Financial and Operating Information.
Borrower shall maintain or cause to be maintained a system of accounting
established and administered in accordance with sound business practices and
consistent with past practice to permit preparation of quarterly and annual
financial statements in conformity with GAAP, and each of the financial
statements described below shall be prepared on a consolidated basis for
Borrower and the Consolidated Entities from such system and records. Borrower
shall deliver or cause to be delivered to Agent (with copies of bound materials
sufficient for each Lender):
(a) Commission Filings. Reasonably promptly following their
filing with the Commission, copies of all required reports and filings filed
with the Commission, including, without limitation, the Annual Report on Form
10-K, the Quarterly Reports on Form 10-Q, registration statements, proxy
statements and the annual reports delivered to the shareholders of Borrower and
the Consolidated Entities.
(b) Annual Financial Statements. Within ninety (90) days after
the close of each Fiscal Year, consolidated balance sheets, statements of
operations, stockholders' equity and cash flows for Borrower and the
Consolidated Entities (in the form provided to the Commission on Borrower's Form
10-K), audited and certified without qualification by the Accountants and
accompanied by a statement directed to the Borrower that, in the course of their
audit (conducted in accordance with generally accepted auditing standards), the
Accountants obtained no knowledge of noncompliance by the Borrower with any term
or provision of this Agreement insofar as accounting matters are concerned. To
the extent Agent desires additional details or supporting information with
respect to Unconsolidated Joint Ventures or individual Real Properties which are
not Unencumbered Assets within the Unencumbered Pool and which details and
information are not contained in the Borrower's Form 10-K, Borrower shall
provide Agent with such details or supporting information as Agent requests
which is reasonably available to Borrower. Without limiting the foregoing, at
Agent's request, within ninety (90) days after the end of each Fiscal Year,
Borrower, with respect to Real Property which is not included within the
Unencumbered Pool, shall provide to Agent operating statements and a schedule
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setting forth the percentage of leasable area leased to tenants in occupancy,
with footnotes indicating which leases are in default in rent payments by more
than thirty (30) days (other than technical, nonmaterial disputes concerning
percentage rentals due) and any other material provisions in respect to which
Borrower has issued a notice of default, for such Real Property.
(c) Quarterly Financial Statements Certified by Executive
Officer. As soon as practicable, and in any event within forty-five (45) days
after the end of each Fiscal Quarter, consolidated balance sheets, stockholders'
equity, statements of operations and statements of cash flow for Borrower and
the Consolidated Entities, which may, in the case of the first three Fiscal
Quarters, be in the form provided to the Commission on Borrower's Form 10-Q, and
certified by an Executive Officer.
(d) Officer's Certificate of Borrower. (i) Together with each
delivery of any financial statement pursuant to subsection (c) above, an
Officer's Certificate of Borrower, stating that the Executive Officer who is the
signatory thereto has reviewed, or caused under his or her supervision to be
reviewed, the terms of this Agreement and the other principal Loan Documents,
and has made, or caused to be made under his or her supervision, a review in
reasonable detail of the transactions and condition of Borrower and the
Consolidated Entities during the accounting period covered by such financial
statements of Borrower and the Consolidated Entities, and that such review has
not disclosed the existence at the end of such accounting period, and that the
signers do not have knowledge of the existence as of the date of the Officer's
Certificate, of any condition or event which constitutes an Event of Default or
Unmatured Event of Default, or, if any such condition or event exists,
specifying the nature and period of existence thereof and what action has been
taken, is being taken and is proposed to be taken with respect thereto; and (ii)
together with each delivery pursuant to subsection (c) above, a Compliance
Certificate demonstrating in reasonable detail (which detail shall include
actual calculations and such supporting information as Agent may reasonably
require) compliance at the end of such accounting periods with the covenants
contained in Sections 7.5 and 7.6 and Article 8.
(e) Cash Flows; Balance Sheet Projections; Projects under
Construction. As soon as practicable, and, in any event, within sixty (60) days
after each June 30 and December 31, (i) projected consolidated cash flows for
Borrower and the Consolidated Entities for the current Fiscal Quarter and the
immediately following four (4) Fiscal Quarters (which shall include, without
limitation, Cash and Cash Equivalents and the projected use of Advances during
such Fiscal Quarters),
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(ii) projected consolidated balance sheets for Borrower and the Consolidated
Entities for the current Fiscal Quarter and the immediately following four (4)
Fiscal Quarters, (iii) a written statement setting forth each construction
project of Borrower and each Consolidated Entity, together with such information
with respect thereto as Agent may reasonably require and (iv) a summary of
Borrower's acquisition pipeline. Borrower shall also provide such additional
supporting details as Agent may reasonably request.
(f) Unencumbered Pool Statements and Operating Results. As soon
as practicable, and in any event within forty-five (45) days after the end of
each Fiscal Quarter, quarterly operating statements for each Unencumbered Asset
in the Unencumbered Pool, in a form approved by Agent, which operating
statements shall include actual quarterly and year-to-date operating income
results, and Rent Rolls for each Unencumbered Asset within the Unencumbered Pool
dated as of the last day of such Fiscal Quarter (the "Quarterly Unencumbered
Pool Statements"), in form and substance satisfactory to Agent, certified as
being true and correct in all material respects by Borrower's chief financial
officer, chief accounting officer, chief executive officer or chief operating
officer. In addition, each Quarterly Unencumbered Pool Statement shall certify
(i) the Gross Revenue for such Fiscal Quarter, (ii) that no more than
twenty-five percent (25%) of Gross Revenue for such Fiscal Quarter was derived
from one Person who is a tenant of one or more Real Properties within the
Unencumbered Pool and/or Affiliates of such Person (collectively, "Single
Tenant"), or, if such is not the case, the percentage of Gross Revenue for such
Fiscal Quarter which was derived from a Single Tenant and the identity of such
Single Tenant, (iii) the percentage of Gross Revenue for such Fiscal Quarter
which was derived from each of Rated Tenants and Credit Tenants and (iv) the
percentage of Gross Revenue for such Fiscal Quarter which was derived from
restaurants, all in such reasonable detail as Agent may reasonably require. In
addition, as soon as practicable, and in any event within ninety (90) days after
the end of the fourth Fiscal Quarter, a year-end operating statement, in form
approved by Agent, which operating statement shall include year-to-date net
operating income results for each Unencumbered Asset within the Unencumbered
Pool dated as of the last day of such Fiscal Quarter (collectively, with the
Quarterly Unencumbered Pool Statements, the "Unencumbered Pool Statements").
Agent shall also have the right to request the foregoing information with
respect to any Real Property owned by Borrower or any Consolidated Entity.
(g) Budgets for Unencumbered Pool. Not later than fifteen (15) days
prior to the beginning of each Fiscal Year, annual operating budgets (including,
without limitation,
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overhead items and capital expenditures) for each Unencumbered Asset in the
Unencumbered Pool for such Fiscal Year, prepared on an annual basis, in a form
approved by Agent, together with all supporting details reasonably requested by
Agent, and certified by the chief executive officer, chief operating officer,
chief financial officer or chief accounting officer of Borrower as being based
upon Borrower's reasonable good faith estimates, information and assumptions at
the time.
(h) Knowledge of Event of Default. Promptly upon a Responsible
Official of Borrower obtaining knowledge (i) of any condition or event which
constitutes an Event of Default or Unmatured Event of Default, or becoming aware
that any Lender has given notice or taken any other action with respect to a
claimed Event of Default or Unmatured Event of Default or (ii) of any condition
or event which constitutes a Material Adverse Effect, an Officer's Certificate
specifying the nature and period of existence of any such condition or event, or
specifying the notice given or action taken by such Lender and the nature of
such claimed Event of Default, Unmatured Event of Default, event or condition,
and what action Borrower has taken, is taking and proposes to take with respect
thereto.
(i) Litigation, Arbitration or Government Investigation.
Promptly upon a Responsible Official of Borrower obtaining knowledge of (i) the
institution of, or threat of, any material action, suit, proceeding,
governmental investigation or arbitration against or affecting Borrower not
previously disclosed in writing by Borrower to Agent pursuant to this Section
5.1(i) or (ii) any material development in any action, suit, proceeding,
governmental investigation or arbitration already disclosed, which, in either
case, has, or if adversely determined is reasonably likely to have, a Material
Adverse Effect, a notice thereof to Agent and such other information as may be
reasonably available to it to enable Agent, Lenders and their counsel to
evaluate such matters.
(j) ERISA Termination Event. As soon as possible, and in any
event within thirty (30) days after a Responsible Official of Borrower knows
that a Termination Event has occurred, a written statement of the chief
financial officer of Borrower describing such Termination Event and the action,
if any, which Borrower or any ERISA Affiliate of Borrower has taken, is taking
or proposes to take, with respect thereto, and, when known, any action taken or
threatened by the IRS, the DOL or the PBGC with respect thereto.
(k) Prohibited ERISA Transaction. As soon as possible, and in
any event within thirty (30) days, after a Responsible Official of Borrower or
any ERISA Affiliate of any of them knows that a prohibited transaction (defined
in
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Section 406 of ERISA and Section 4975 of the Code and which is not subject to a
statutory or prohibited transaction class exemption) has occurred, a statement
of the chief financial officer of Borrower describing such transaction.
(l) Benefit Plan Annual Report. On request of Agent, within
thirty (30) days after the filing thereof with the DOL, the IRS or the PBGC,
copies of each annual report, including Schedule B thereto, filed with respect
to each Benefit Plan of Borrower or any ERISA Affiliate of Borrower.
(m) Benefit Plan Funding Waiver Request. Within thirty (30) days
after the filing thereof with the IRS, a copy of each funding waiver request
filed with respect to any Benefit Plan of Borrower or any ERISA Affiliate of
Borrower and all communications received by Borrower or any ERISA Affiliate of
Borrower with respect to such request.
(n) Establishment of Benefit Plan and Increase in Contributions
to the Benefit Plan. Not less than ten (10) days prior to the effective date
thereof, a notice to Agent of the establishment of a Benefit Plan (or the
incurrence of any obligation to contribute to a Multiemployer Plan) by Borrower
or any ERISA Affiliate of Borrower. Within thirty (30) days after the first to
occur of an amendment of any then existing Benefit Plan of Borrower or any ERISA
Affiliate of Borrower which will result in a material increase in the benefits
under such Benefit Plan or a notification of any such increase, or the
establishment of any new Benefit Plan by Borrower or any ERISA Affiliate of
Borrower or the commencement of contributions to any Benefit Plan to which
Borrower or any ERISA Affiliate of Borrower was not previously contributing, a
copy of said amendment, notification or Benefit Plan.
(o) Qualification of ERISA Plan. Promptly upon, and in any event
within thirty (30) days after, receipt by Borrower or any ERISA Affiliate of
Borrower of an unfavorable determination letter from the IRS regarding the
qualification of a Plan under Section 401(a) of the Internal Revenue Code, a
copy of said determination letter, if such disqualification would have a
Material Adverse Effect on Borrower.
(p) Multiemployer Plan Withdrawal Liability. Promptly upon, and
in any event within thirty (30) days after receipt by Borrower or any ERISA
Affiliate of Borrower of a notice from a Multiemployer Plan regarding the
imposition of material withdrawal liability, a copy of said notice.
(q) Failure to Make Section 412 Payment. Promptly upon, and in
any event within thirty (30) days after, Borrower or any ERISA Affiliate of
Borrower fails to make a required installment under subsection (m) of Section
412 of the Internal
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Revenue Code or any other payment required under Section 412 of the Internal
Revenue Code on or before the due date for such installment or payment, a
notification of such failure, if such failure could result in either the
imposition of a Lien under said Section 412 or otherwise have or could
reasonably be anticipated to have a Material Adverse Effect.
(r) Failure of Borrower to Qualify as Real Estate Investment
Trust. Promptly upon, and in any event within forty-eight (48) hours after a
Responsible Official of Borrower first has actual knowledge of (i) Borrower
failing to continue to qualify as a real estate investment trust as defined in
Section 856 of the Internal Revenue Code (or any successor provision thereof),
(ii) any act by Borrower causing its election to be taxed as a real estate
investment trust to be terminated, (iii) any act causing Borrower to be subject
to the taxes imposed by Section 857(b)(6) of the Internal Revenue Code (or any
successor provision thereto), or (iv) Borrower failing to be entitled to a
dividends paid deduction which meets the requirements of Section 857 of the
Internal Revenue Code, a notice of any such occurrence or circumstance.
(s) Asset Acquisitions and Dispositions, Indebted ness, Merger,
Etc. Without limiting, modifying or waiving any restriction in the Loan
Documents, concurrently with notice to Borrower's priority mailing list and in
all events not later than any public disclosure, written notice of any material
investments (other than in Cash Equivalents), material acquisitions, asset
purchases, dispositions, disposals, divestitures or similar transactions
involving Property, the raising of additional equity or the incurring or
repayment of material Debt, or any material merger, by or with Borrower, and, if
requested by Agent after the consummation of such transaction, a Compliance
Certificate within 14 Business Days after the date of such request, in form and
substance reasonably acceptable to Agent, demonstrating in reasonable detail
(which detail shall include actual calculations and such supporting information
as Agent may reasonably require) compliance, after giving effect to such
proposed transaction(s), with the covenants contained in Sections 7.5 and 7.6
and Article 8. For purposes of this Section 5.1(s), any investment, acquisition,
asset purchase, disposition, disposal, divestiture, merger or similar
transaction shall be considered "material" if it involves assets exceeding ten
percent (10%) of Borrower's assets (as existing prior to giving effect to such
transaction). Borrower's written notice of each Real Property acquisition or
disposition, if required in accordance with the foregoing, shall contain a
description of all improvements which are a part of such Real Property, the
square footage of such improvements, the acquisition or disposition price and
such other information with respect thereto reasonably requested by the Agent.
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(t) Other Information. Upon the reasonable request of Agent,
such other information, reports, contracts, schedules, lists, documents,
agreements and instruments in the possession of the Borrower with respect to (i)
the Unencumbered Assets (which, if requested by Agent, shall include Property
Information) or any other assets of the Borrower or any Consolidated Entity
(either on an individual or an aggregate basis), (ii) any material change in the
Borrower's investment, finance or operating policies, or (iii) the Borrower's or
any Consolidated Entity's business, condition (financial or otherwise),
operations, performance, properties or prospects as Agent may from time to time
reasonably request, including, without limitation, annual information with
respect to cash flow projections, budgets, operating statements (current year
and immediately preceding year), Rent Rolls, lease expiration reports, leasing
status reports, note payable summaries, bullet note summaries, equity funding
requirements, contingent liability summaries, line of credit summaries, line of
credit collateral summaries, wrap note or note receivable summaries, schedules
of outstanding letters of credit, summaries of Cash and Cash Equivalents,
projections of leasing fees and overhead budgets. Provided that Agent gives
Borrower reasonable prior written notice and an opportunity to participate,
Borrower hereby authorizes Agent (whenever Agent deems it reasonably necessary
or appropriate) to communicate with the Accountants and authorizes the
Accountants to disclose (subject to the Accountants' disclosure policies) to
Agent any and all financial statements and other information of any kind,
including copies of any management letter or the substance of any oral
information, that such accountants may have with respect to the Unencumbered
Assets or Borrower's or any Consolidated Entity's condition (financial or
otherwise), operations, properties, performance and prospects. Concurrently
therewith, Agent will notify Borrower of any such communication and, at Agent's
request, Borrower shall deliver a letter addressed to the Accountants
instructing them to disclose such information in compliance with this Section
5.1(t).
(u) Press Releases; SEC Filings and Financial Statements.
Telephonic or telecopy notice to Agent concurrently with or prior to issuance of
any material press release concerning the Borrower and, as soon as practicable
after filing with the Commission, all reports and notices, proxy statements,
registration statements and prospectuses of the Borrower. All materials sent or
made available generally by the Borrower to the holders of its publicly-held
Securities or filed with the Commission, including all periodic reports required
to be filed with the Commission, shall be delivered by Borrower to Agent as soon
as available.
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(v) Accountant Reports. Copies of all reports prepared by the
Accountants and submitted to Borrower in connection with each annual, interim or
special audit or review of the financial statements or practices of Borrower,
including the comment letter submitted by the Accountants in connection with
their annual audit.
(w) Annual Reserve. When Borrower delivers the financial
statements referred to in Section 5.1(b) to Agent, Borrower shall also deliver
to Agent an accounting for the Annual Reserve for the prior Fiscal Year, which
accounting shall set forth the sources and uses of all funds in the Annual
Reserve for such Fiscal Year and which shall otherwise be in such detail, and
contain such information, as Agent may reasonably require.
5.2 Environmental Notices. Borrower shall notify Agent, in writing, as
soon as practicable, and in any event within ten (10) days after a Responsible
Official of Borrower's learning thereof, of any: (a) written notice or claim to
the effect that the Borrower or any Consolidated Entity is or may be liable to
any Person as a result of any material Release or threatened Release of any
Contaminant into the environment; (b) written notice that the Borrower or any
Consolidated Entity is subject to investigation by any Governmental Authority
evaluating whether any Remedial Action is needed to respond to the Release or
threatened Release of any Contaminant into the environment; (c) written notice
that any Property of the Borrower or any Consolidated Entity is subject to an
Environmental Lien; (d) written notice of violation of any Environmental Laws to
the Borrower or any Consolidated Entity or awareness of a condition which might
reasonably result in a notice of violation of any Environmental Laws by the
Borrower or any Consolidated Entity; (e) commencement or written threat of any
judicial or administrative proceeding alleging a violation of any Environmental
Laws; (f) written notice from a Governmental Authority of any changes to any
existing Environmental Laws that could constitute a Material Adverse Effect; or
(g) any proposed acquisition of stock, assets, real estate or leasing of
property, or any other action by Borrower that, to the best of Borrower's
knowledge, could subject the Borrower or any Consolidated Entity to
environmental, health or safety Liabilities and Costs that could constitute a
Material Adverse Effect. With regard to the matters referred to in clauses (a)
through (e) above, the same shall apply in respect of each Unencumbered Asset
only if the matter will have a material adverse effect on such Unencumbered
Asset and, in the case of other Real Property of the Borrower or any
Consolidated Entity, only if the matter could reasonably be expected to
constitute a Material Adverse Effect.
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5.3 Confidentiality. Confidential information obtained by Agent or
Lenders pursuant to this Agreement or in connection with the Advances shall not
be disseminated by Agent or Lenders and shall not be disclosed to third parties
except (a) to regulators, taxing authorities and other Governmental Authorities
having jurisdiction over Agent or such Lender or otherwise in response to
Requirements of Law, (b) to their respective auditors and legal counsel and in
connection with regulatory, administrative and judicial proceedings as necessary
or relevant, including enforcement proceedings relating to the Loan Documents,
and (c) to any prospective assignee of or participant in a Lender's interest
under this Agreement or any prospective purchaser of the assets or a controlling
interest in any Lender, provided that such prospective assignee, participant or
purchaser first agrees to be bound by the provisions of this Section 5.3. In
connection with disclosures of confidential information to any non-governmental
third-party, the Lender(s) from whom the same has been requested shall, to the
extent feasible and permitted, give prior notice of such request to Borrower;
however, neither Agent nor any such Lender shall incur any liability to Borrower
for failure to do so. For purposes hereof, "confidential information" shall mean
all nonpublic information obtained by Agent or Lenders, unless and until such
information becomes publicly known, other than as a result of unauthorized
disclosure by Agent or Lenders of such information.
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ARTICLE 6
AFFIRMATIVE COVENANTS
Borrower covenants and agrees that, on and after the date
hereof, until payment and performance in full of all of the Obligations, the
expiration of the Commitment and termination of this Agreement:
6.1 Existence. Borrower shall at all times maintain its existence as a
corporation, and preserve and keep in full force and effect its rights and
franchises unless the failure to maintain such rights and franchises would not
constitute a Material Adverse Effect.
6.2 Qualification. Borrower shall qualify and remain qualified to do
business in each jurisdiction in which the nature of its business requires it to
be so qualified except for those jurisdictions where failure to so qualify would
not constitute a Material Adverse Effect.
6.3 Compliance with Laws, Etc. Borrower shall (i) comply with all
Requirements of Law, and all restrictive covenants affecting Borrower or the
Properties, performance, prospects, assets or operations of Borrower, and (ii)
obtain as needed all Permits necessary for its operations and maintain such in
good standing, except in each of the foregoing cases where the failure to do so
will not have a Material Adverse Effect on Borrower.
6.4 Payment of Taxes and Claims. Borrower shall pay (i) all taxes,
assessments and other governmental charges imposed upon it or on any of its
properties or assets or in respect of any of its franchises, business, income or
Property before any penalty or interest accrues thereon, the failure to make
payment of which will have a Material Adverse Effect on Borrower, and (ii) all
claims (including, without limitation, claims for labor, services, materials and
supplies) for sums, material in the aggregate to Borrower, which have become due
and payable and which by law have or may become a Lien other than a judgment
lien upon any of Borrower's Properties or assets, prior to the time when any
penalty or fine shall be incurred with respect thereto. Notwithstanding the
foregoing, Borrower may contest by appropriate legal proceedings conducted in
good faith and with due diligence, the amount, validity or application, in whole
or in part, of any taxes, assessments, other governmental charges or claims
described above, provided that either Borrower shall provide such evidence as
Agent may reasonably require that Borrower is maintaining adequate reserves as
may be required by GAAP or Borrower shall provide such security as may be
reasonably required by Agent, in each case to insure ultimate payment of the
same and to prevent any
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sale or forfeiture of any of Borrower's Property (or any portion thereof or
interest therein), provided however, that the provisions of this Section 6.4
shall not be construed to permit Borrower to contest the payment of any
Obligations or any other sums payable by Borrower to Agent or Lenders here under
or under any other Loan Document. Notwithstanding any of the foregoing, Borrower
shall indemnify, defend and save Agent and Lenders harmless from and against any
liability, cost or expense of any kind that may be imposed on Agent or Lenders
in connection with any such contest and any loss resulting therefrom.
6.5 Maintenance of Properties; Insurance. Borrower shall maintain in
good repair, working order and condition, excepting ordinary wear and tear, all
of its Property and will make or cause to be made all appropriate repairs,
renewals and replacements thereof; provided, however, that the failure to
maintain a particular item of Property (other than improved Real Property) that
is not of significant value to Borrower or which is obsolete shall not
constitute a violation of this covenant. Borrower shall maintain (a) insurance
with responsible companies in such amounts and against such risks as is usually
carried by companies engaged in similar businesses and owning similar properties
in the same general areas in which Borrower operates, (b) insurance required by
any Governmental Authority having jurisdiction over Borrower, and (c) all other
insurance reasonably required by Agent from time to time. Neither Borrower nor
any other Consolidated Entity shall assign or otherwise transfer, or grant a
security interest in, any casualty insurance carried by it or in the proceeds of
such insurance in a manner which is disproportionate to the value of all of the
Real Property insured by Borrower or such Consolidated Entity.
6.6 Inspection of Property; Books and Records; Discussion. Borrower
shall permit any authorized representatives designated by any Lender to visit
and inspect any of its Properties (subject to rights of tenants), including all
Unencumbered Assets, upon reasonable prior notice, to inspect financial and
accounting records and leases, and to make copies and take extracts therefrom,
all at such times during normal business hours and as often as any Lender may
reasonably request; provided that all such visits and inspections shall be
coordinated through the Agent and the Agent shall give reasonable prior notice
to Borrower of all such visits and inspections; and provided further, however,
that (i) each person designated by Agent shall take reasonable steps to minimize
disruption to the operations of Borrower caused by such inspection, and (ii)
nothing contained herein shall require Borrower to permit any Lender or Agent to
examine or otherwise have access to any matter that is protected from disclosure
by the attorney-client privilege or the doctrine of
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attorney work product. In connection therewith, Borrower shall pay all expenses
required by Section 12.1. Borrower will keep proper books of record and account
in which entries, in conformity with GAAP and as otherwise required by this
Agreement and applicable Requirements of Law, shall be made of all dealings and
transactions in relation to its businesses and activities and as otherwise
required under Section 5.1.
6.7 Maintenance of Permits, Etc. Borrower will maintain in full force
and effect all Permits, franchises, patents, trademarks, trade names,
copyrights, authorizations or other rights necessary for the operation of its
business, except where the failure to obtain any of the foregoing would not have
a Material Adverse Effect on Borrower; and notify Agent in writing, promptly
after learning thereof, of the suspension, cancellation, revocation or
discontinuance of, or of any pending or threatened action or proceeding seeking
to suspend, cancel, revoke or discontinue, any material Permit, patent,
trademark, trade name, copyright, governmental approval, franchise authorization
or right.
6.8 Conduct of Business. Except for Investments expressly permitted
pursuant to Section 8.8 and investments in Cash and Cash Equivalents, Borrower
shall engage only in the business of acquiring, developing, owning, operating
and managing Real Property within the continental United States and any business
activities and investments of Borrower incidental thereto.
6.9 Use of Proceeds. Borrower shall use the proceeds of the Advances
only for Real Property acquisitions, development of Real Property and for any
other general corporate purposes (including payment of Borrower's Indebtedness).
6.10 Securities Law Compliance. The Borrower shall comply in all
material respects with all rules and regulations of the Commission and file all
reports required by the Commission relating to the Borrower's publicly-held
Securities.
6.11 Continued Status as a REIT; Prohibited Transactions. The Borrower
(i) will continue to be a real estate investment trust as defined in Section 856
of the Code (or any successor provision thereto), (ii) will not revoke its
election to be a real estate investment trust, (iii) will not engage in any
"prohibited transactions" as defined in Section 857(b)(6)(B)(iii) of the Code
(or any successor provision thereto), and (iv) will continue to be entitled to a
dividend paid deduction meeting the requirements of Section 857 of the Code.
6.12 NASDAQ Listed Company. The Preferred Stock of the Borrower shall at
all times be listed for trading on NASDAQ or
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another national securities exchange reasonably acceptable to Agent.
6.13 Year 2000 Covenant. Borrower covenants and represents that the
following are Year 2000 Compliant: (a) Borrower itself; and (b) each
Unencumbered Asset in the Unencumbered Pool and each Consolidated Entity.
Borrower covenants and represents that it has made reasonable inquiries of and
request reasonable validation that each of the following are similarly Year 200
Compliant: (x) all major tenants or other entities from which Borrower receives
payments; and (y) all major contractors, suppliers, service provider and vendors
of Borrower. As used in this Section 6.13, "major" shall means properties or
entities that failure of which to be Year 2000 Compliant would have a material
adverse economic impact upon Borrower. The term "Year 2000 Compliant" shall
mean, in regard to any property or entity, that all software, hardware,
equipment, goods or systems utilized by or material to the physical operations,
business operations, or financial reporting of such property or entity
(collectively, the "systems") will properly perform date sensitive functions
before, during and after the year 2000. In furtherance of these covenants,
Borrower shall, in addition to any other necessary actions, perform a
comprehensive review and assessment of all systems of Borrower, and shall adopt
a detailed plan, with itemized budget, for the testing, remediation, and
monitoring of such systems. Borrower shall, within thirty business days of
Agent's written request, provide to Agent such certificates or other evidence of
Borrower's compliance with the terms of this paragraph as Agent may from time to
time reasonably require.
6.14 Additional Guarantors. Borrower shall give Agent written notice
within 15 Business Days after the formation or acquisition of any Subsidiary
which is an Additional Guarantor. Within 15 days after such formation or
acquisition, Borrower shall cause such Additional Guarantor to execute and
deliver to Agent a Guaranty.
6.15 Intentionally left blank.
6.16 Security Interest in Entities. Borrower shall give Agent written
notice within 15 Business Days after the formation or acquisition by Borrower,
or any Consolidated Entity, of any corporation, partnership, joint venture,
limited liability company or other entity (each, an "Entity", which shall not
include Guarantors) in which Borrower or such Consolidated Entity holds an
ownership interest (the "Interest"). Within 30 Business Days after the formation
or acquisition of any Entity, Borrower, or the applicable Consolidated Entity,
as the case may be, shall execute and deliver to Agent a security agreement
("Entity Security Agreement") in form and substance
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reasonably satisfactory to Agent, pursuant to which Borrower, or such
Consolidated Entity, grants to Agent, for the benefit of the Lenders, a security
interest in the Interest in such Entity, together with such financing statements
and other documents, instruments and agreements as may be necessary to perfect
such security interest. Borrower agrees to obtain and deliver to Agent such
consents and agreements from the other owners of each Entity as Agent may
reasonably require in connection with the granting of the security interest in
such Entity. Borrower shall not cause or permit any Entity which is a
Consolidated Entity to create, incur or assume any Debt or Guaranty Obligations
other than Debt which is secured by real property owned by such Entity and trade
debt incurred in the ordinary course of business of such Entity so long as such
trade debt does not, at any time, exceed a reasonable amount as reasonably
determined by Agent.
6.17 Board of Directors of Borrower. Borrower agrees that not less than
a majority of Borrower's board of directors shall at all times be PREN
Representatives (for example, for so long as Borrower has 5 members on its board
of directors, not less than 3 shall be PREN Representatives).
6.18 Excel Legacy Corporation Board of Directors. Borrower agrees that
at least one member of the board of directors of Excel Legacy Corporation shall
at all times be a PREN Representative.
6.19 Annual Reserve. Borrower shall maintain an annual cash reserve of
not less than $7,500,000 (the "Annual Reserve"). The Annual Reserve shall be
used only for the acquisition and/or improvement of Real Property, to repurchase
Borrower's Preferred Stock or to repay Borrower's Debt and for no other use or
purpose.
6.20 Payment of Interest on Original Loan. Borrower shall pay to Agent,
on February 15, 2000, all accrued and unpaid interest under the Original Loan.
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ARTICLE 7
NEGATIVE COVENANTS
Borrower covenants and agrees that, on and after the date
hereof, until payment and performance in full of all of the Obligations, the
expiration of the Commitment and termination of this Agreement:
7.1 Restrictions on Fundamental Changes.
(a) The Borrower and Consolidated Entities shall not enter into
any merger, consolidation or reorganization or any sale of all or a
substantial portion of the assets of the Borrower and the Consolidated
Entities, taken as a whole, or liquidate, wind up or dissolve, except
that any Person engaged in the development and operation of Retail
Properties that are of similar caliber to those of Borrower may merge or
consolidate with and into Borrower or any Consolidated Entity, provided
(i) no Event of Default or Unmatured Event of Default, then exists or
would result therefrom, (ii) Borrower or such Consolidated Entity, as
the case may be, is the surviving entity, (iii) Requisite Lenders
reasonably determine that such merger or consolidation will not
constitute a Material Adverse Effect and (iv) the Borrower delivers to
the Agent, prior to the Borrower or such Consolidated Entity becoming
obligated (conditionally or otherwise) to proceed with such transaction,
a certificate, in form and substance and in such detail as the Agent may
reasonably require, of an Executive Officer demonstrating compliance
with this Agreement on a proforma basis giving effect to such
transaction;
(b) Borrower shall not change its Fiscal Year; or
(c) Borrower shall not engage in any line of business other than
as expressly permitted under Section 6.8.
7.2 ERISA. Borrower shall not permit any ERISA Affiliates to do any of
the following to the Borrower shall not extent that such act or failure to act
would constitute, in the aggregate, after taking into account any other such
acts or failure to act, a Material Adverse Effect:
(a) Engage, or knowingly permit an ERISA Affiliate to engage, in
any prohibited transaction described in Section 406 of ERISA or Section
4975 of the Code which is not exempt under Section 407 or 408 of ERISA
or Section 4975(d) of the Code for which a class exemption is not
available or a private exemption has not been previously obtained from
the DOL;
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(b) Permit to exist any accumulated funding deficiency (as
defined in Section 302 of ERISA and Section 412 of the Code), whether or
not waived;
(c) Fail, or permit an ERISA Affiliate to fail, to pay timely
required contributions or annual installments due with respect to any
waived funding deficiency to any Plan;
(d) Terminate, or permit an ERISA Affiliate to terminate, any
Benefit Plan which would result in any liability of Borrower or an ERISA
Affiliate under Title IV of ERISA; or
(e) Fail, or permit any ERISA Affiliate to fail, to pay any
required installment under section (m) of Section 412 of the Code or any
other payment required under Section 412 of the Code on or before the
due date for such installment or other payment.
7.3 Debt and Guaranty Obligations. Borrower shall not create, incur or
assume any Debt or Guaranty Obligations except:
(a) Subject to Section 8.9, below, Debt which is secured by Real
Property; and
(b) Until such time as Borrower obtains a long-term unsecured
senior debt rating of at least BBB- from Standard & Poor's and at least
Baa3 from Xxxxx'x Investors Service, Inc., Borrower may incur Debt or
Guaranty Obligations so long as the aggregate of Borrower's recourse
Debt and Guaranty Obligations, other than those with respect hereto,
shall not exceed 10% of Gross Asset Value.
7.4 Amendment of Constituent Documents. The Borrower shall not
materially amend its articles of incorporation, by-laws or any other charter or
governing document without the prior written consent of Requisite Lenders,
except as may be required to comply with Section 6.11.
7.5 Minimum Ownership Interest of Sol and Xxxxxx Xxxxx. Sol and Xxxxxx
Xxxxx shall at all times retain directly or indirectly ownership, in the
aggregate, of no less than fifteen percent (15%) of the Capital Stock of the
Borrower. This Section 7.5 may be amended or waived only with the written
consent of all Lenders, which consent may be withheld in each Lender's sole and
absolute discretion.
7.6 Management. Xxxx Xxxxx shall at all times be the President and CEO
of the Borrower; provided, however, that, if
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due to death, incapacity, his dismissal or his resignation as the President and
CEO of the Borrower, Xxxx Xxxxx is unable to act in such capacities, Borrower
shall have one hundred eighty (180) days to obtain the approval of all Lenders
(which approval shall not be unreasonably withheld) with respect to the hiring
of a new President and CEO of the Borrower or a realignment of the existing
officers of Borrower so that the President and CEO positions are filled (or
duties thereof are properly delegated). In the event Borrower shall fail to
obtain approval of all Lenders within such 180-day period, then Borrower shall,
at the election and upon the demand of Requisite Lenders, pay in full all
Obligations under the Loan Documents not later than thirty (30) days after the
end of such 180-day period, whereupon this Agreement and the Commitment shall be
terminated. If Borrower fails to obtain the approval of all Lenders within such
180-day period, then no further Advances shall be permitted after such 180-day
period until Borrower shall have obtained approval of all Lenders under this
Section 7.6.
7.7 Margin Regulations. No portion of the proceeds of any Advances shall
be used in any manner which might cause the extension of credit or the
application of such proceeds to violate Regulation T, U or X or any other
regulation of the Federal Reserve Board or to violate the Securities Exchange
Act or the Securities Act, in each case as in effect on the applicable Funding
Date.
7.8 Management Agreements. Without the consent of Requisite Lenders,
Borrower shall not enter into any management, consulting or tax sharing
agreements with any third party or with any Affiliate of Borrower with respect
to more than 25% of the Borrower's Real Property based upon the value of
Borrower's total assets (determined pursuant to GAAP).
7.9 Preferred Stock. Without the consent of Requisite Lenders, Borrower
shall not issue preferred stock in excess of the 26,000,000 shares of Preferred
Stock that are currently authorized pursuant to Borrower's Charter and
resolutions adopted by Borrower's Board of Directors on June 15, 1998 or
increase the existing dividend for the Preferred Stock (which is $1.40 per share
annually).
7.10 Development Activity.
(a) Neither Borrower nor any Consolidated Entity shall engage,
directly or indirectly, in the development of any Real Property; provided,
however, that, notwithstanding the foregoing, Borrower and the Consolidated
Entities may engage in the development of such Real Property only if the
aggregate cost of acquisition and development of all such Real Properties under
development (assuming the full cost of developing such
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Real Properties) does not exceed, at any time, twenty percent (20%) of Gross
Asset Value.
(b) For purposes of this Section 7.10 only:
(i) "Gross Asset Value", as of any date of
determination, shall be adjusted by subtracting from Gross Asset Value
the costs incurred to such date of determination for each such Real
Properties under development and adding to Gross Asset Value the
estimated full cost of developing such Real Properties; and
(ii) The terms "development" and "under development"
shall include (A) new construction or the substantial renovation of
improvements to Real Property, (B) any interest of Borrower or any
Consolidated Entity in Real Property which is proposed to be developed,
or any interest therein pursuant to which Borrower or any Consolidated
Entity has the right to approve site plans or other plans and
specifications or pursuant to which such parties' obligations are
conditioned upon the achievement of certain leasing levels, and (C) any
agreement by Borrower or any Consolidated Entity which obligates
Borrower or such Consolidated Entity to contribute or otherwise advance
funds in connection with or upon completion of the development or which
is under development and lease-up at the time such agreement is entered
into. The terms "development" and "under development" shall not include
(1) any rights pursuant to option agreements that do not obligate
Borrower or any Consolidated Entity to act pursuant thereto or pursuant
to other agreements that limit the recourse of the other party thereto
upon a default or breach by Borrower or any Consolidated Entity
thereunder to a reasonable xxxxxxx money deposit as liquidated damages
or (2) the addition of amenities or other related facilities to Real
Property which is already improved and/or developed.
(c) Notwithstanding the foregoing, neither Borrower nor any
Consolidated Entity shall make, own or otherwise hold any Investment in, or
otherwise engage in, any Speculative Development if it would result in the
aggregate of all such Investments being in excess of ten percent (10%) of Gross
Asset Value. The values of the Investments and other assets which make up the
foregoing Speculative Development shall be the original cost of such Investments
and assets.
(d) Nothing in this Section 7.10 shall prohibit or otherwise
preclude Borrower or any Consolidated Entity from entering into an agreement to
acquire, or acquiring, Real Property which has been developed and initially
leased by another Person.
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7.11 Organization of Borrower. Without the prior written consent of
Agent, Borrower shall not change its state of incorporation from Maryland.
7.12 Debt of Price Self Storage and Price Enterprises LP. Borrower shall
not cause or permit (i) Price Self Storage to create, incur or assume any Debt
or Guaranty Obligations other than its existing Debt to General Motors
Acceptance Corporation in the approximate amount of $8,900,000 and shall not
cause or permit Price Self Storage to increase the amount of such Debt above the
amount outstanding as of the date of this Agreement and (ii) Price Enterprises
LP to create, incur or assume any Debt or Guaranty Obligations other than its
existing Debt as of the date of this Agreement and shall not cause or permit
Price Enterprises LP to increase the amount of such Debt above the amount
outstanding as of the date of this Agreement. Notwithstanding the foregoing,
Price Self Storage and Price Enterprises LP shall each be permitted to incur
trade debt in the ordinary course of business so long as such trade debt does
not, at any time, exceed $100,000.
7.13 Transactions with Affiliates. Borrower shall not enter into any
transaction of any kind with any Affiliate of Borrower other than (a) salary,
bonus, employee stock option and other compensation arrangements with directors,
officers or managers in the ordinary course of business, (b) transactions that
are fully disclosed to the board of directors of Borrower and expressly
authorized by a resolution of the board of directors of Borrower which is
approved by a majority of the directors not having an interest in the
transaction, and (c) transactions on overall terms at least as favorable to
Borrower as would be the case in an arms-length transaction between unrelated
parties of equal bargaining power. Without limiting the foregoing, Borrower
shall not, without the prior written approval of Requisite Lenders, (A) sell or
otherwise transfer any real or other property ("Transferred Property") to Excel
Legacy Corporation or any Affiliate of Excel Legacy Corporation if (i) the sales
price of the Transferred Property is in excess of $5,000,000 and (ii) the fair
market value of the Transferred Property, as established by an independent MAI
appraiser and as set forth in a written appraisal ("Transferred Property
Appraisal") prepared by such appraiser, varies by 10% or more from such sales
price or (B) purchase or otherwise acquire any Nonstabilized Property from Excel
Legacy Corporation or any Affiliate of Excel Legacy Corporation if the sum of
the fair market values of such Nonstabilized Property and all other
Nonstabilized Properties acquired by Borrower from Excel Legacy Corporation or
any Affiliate of Excel Legacy Corporation during the immediately preceding
one-year period would exceed $15,000,000. The fair market value of each
Nonstabilized Property shall be established by an independent MAI appraiser and
shall be set forth in a written appraisal
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("Nonstabilized Property Appraisal") prepared by such appraiser. As used in this
Section 7.13, (1) "Nonstabilized Property" means real property which, as
reasonably determined by Agent, is less than 80% leased and/or with respect to
which the Nonstabilized Property Income has not been equal to or greater than
the Nonstabilized Property Expenses for each of the immediately preceding 6
months, (2) "Nonstabilized Property Income" means, for any period and with
respect to each Nonstabilized Property, the rental income derived from such
Nonstabilized Property and actually received by Excel Legacy Corporation during
such period and (3) "Nonstabilized Property Expenses" means, for any period and
with respect to each Nonstabilized Property, all costs and expenses incurred by
Excel Legacy Corporation with respect to the ownership, use, operation, repair,
maintenance, management, financing, leasing or marketing of such Nonstabilized
Property during such period (including, without limitation, all interest and
principal payments made with respect to each loan secured by a Lien on such
Nonstabilized Property). With respect to each Transferred Property, Borrower
shall deliver to Agent, not less than 15 days prior to the proposed date upon
which such Transferred Property is to be conveyed to Borrower, copies of all
agreements and other documents pertaining to such conveyance, including, without
limitation, any purchase and sale agreement or other similar document, a copy of
the Transferred Property Appraisal for such Transferred Property and all other
information and documents with respect to such conveyance and such Transferred
Property as Agent may reasonably request. With respect to each Nonstabilized
Property, Borrower shall deliver to Agent, not less than 15 days prior to the
proposed date upon which such Nonstabilized Property is to be acquired by
Borrower, copies of all agreements and other documents pertaining to such
acquisition, including, without limitation, any purchase and sale agreement or
other similar document, a copy of the Nonstabilized Property Appraisal for such
Nonstabilized Property and all other information and documents with respect to
such acquisition, such Nonstabilized Property, the Nonstabilized Property Income
for such Nonstabilized Property and the Nonstabilized Property Expenses for such
Nonstabilized Property as Agent may reasonably request.
7.14 Transfers of Assets. Without the prior written consent of Requisite
Lenders, Borrower shall not, in any Fiscal Year, sell or otherwise transfer any
real or other property if the purchase price of such property would, when added
to the aggregate purchase prices for all prior sales or transfers in such Fiscal
Year, exceed 25% of Gross Asset Value (determined as of the date of such sale or
other transfer).
7.15 Company Agreement. Borrower shall not, without the prior written
consent of Agent, amend or otherwise modify the Company Agreement. Borrower
shall give Agent written
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notice of the occurrence of any Preferred Termination (as defined in the Company
Agreement) within 10 days after the occurrence of such Preferred Termination.
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ARTICLE 8
FINANCIAL COVENANTS
Borrower covenants and agrees that, on and after the date of
this Agreement and until payment and performance in full of all the Obligations,
the expiration of the Commitment and the termination of this Agreement:
8.1 Tangible Net Worth. The Tangible Net Worth of the Borrower and the
Consolidated Entities, as of the last day of each Fiscal Quarter, shall not be
less than the sum of (i) $309,000,000, plus (ii) 90% of the cumulative net cash
proceeds received by Borrower from the issuance of Capital Stock of the Borrower
after the Closing Date. For the purposes of clause (ii), "net" means net of
underwriters' discounts, commissions and other reasonable out-of-pocket expenses
of the transaction actually paid to any Person (other than any Affiliate of
Borrower).
8.2 Maximum Total Liabilities to Gross Asset Value. The ratio of Total
Liabilities to Gross Asset Value shall not exceed 40% at any time.
8.3 Minimum Unencumbered Asset Pool Value. The Unencumbered Asset Pool
Value shall not, at any time, be less than 200% of the unsecured Total
Liabilities of the Borrower and the Consolidated Entities.
8.4 Minimum Interest Coverage Ratio. As of the last day of any Fiscal
Quarter, the Interest Coverage Ratio shall not be less than 2.00 to 1.00.
8.5 Minimum Fixed Charge Coverage Ratio. As of the last day of any
Fiscal Quarter, the Fixed Charge Coverage Ratio shall not be less than 1.15 to
1.00.
8.6 Minimum Unsecured Interest Expense Coverage. As of the last day of
any Fiscal Quarter, the Unsecured Interest Expense Coverage Ratio of the
Borrower and the Consolidated Entities shall not be less than 1.80 to 1.00.
8.7 Distributions.
(a) Subject to subsection (b) below, aggregate distributions to
shareholders of the Borrower shall not exceed, for any four (4) consecutive
Fiscal Quarters, ninety-five percent (95%) of Funds from Operations. For
purposes of this Section 8.7, the term "distributions" shall mean all dividends
and other distributions to the holder of any equity interests in Borrower. The
term "distributions" shall not include the
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repurchase by Borrower, or redemptions, of Borrower's Capital
Stock.
(b) Aggregate distributions during the continuance of any
non-monetary Event of Default shall not exceed the sum of (i) dividends on
Borrower's Preferred Stock (which shall not exceed $1.40 per share annually),
plus (ii) the minimum amount necessary to comply with Section 857(a) of the Code
and to continue to be listed on NASDAQ or another national securities exchange
reasonably acceptable to Agent (if NASDAQ or such other national securities
exchange requires, as a condition to listing, such minimum distributions).
During the continuance of any monetary Event of Default, Borrower shall not make
any distributions.
8.8 Investments; Asset Mix. Except as permitted under Section 7.1(a),
the Borrower shall not at any time make, own or otherwise hold any Investment in
any Person, or purchase, lease or own any Real Property or other asset, except
that the Borrower and the Consolidated Entities, in the aggregate and on a
consolidated basis, may own or lease the following, subject to the limitations
set forth below:
Limitation on Value
for Each Asset Type
at the Time of
Asset Type Determination
---------- -------------
1. Wholly-Owned Retail Property Unlimited
2. Wholly-Owned Land which is not 5% of Gross Asset Value
part of an existing improved
development
3. Wholly-Owned Foreign Property 5% of Gross Asset Value
4. Wholly-Owned Real Property 20% of Gross Asset Value
(other than Retail Properties
or Land referred to in
paragraph 2, above)
5. Wholly-owned Capital Stock of 10% of Gross Asset Value
corporations
6. Investment Mortgages and Notes 15% of Gross Asset Value
Receivable
7. Ownership Interest in 15% of Gross Asset Value
Unconsolidated Joint Ventures
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Notwithstanding the foregoing, Investments and other assets in
the foregoing categories 2 through 7 may not, in the aggregate exceed, at any
time, 25% of Gross Asset Value. All values of Investments and other assets shall
be the original cost of such Investments and assets, except as otherwise
expressly provided. Without limiting the terms of this Section 8.8, Borrower
shall not make any loans to, or otherwise extend any credit to, Excel Legacy
Corporation, any Affiliate of Excel Legacy Corporation or any Affiliate of
Borrower.
8.9 Secured Debt. The aggregate amount of all Debt of the Borrower and
the Consolidated Entities secured by Real Property shall not, at any time,
exceed 35% of Gross Asset Value.
8.10 Gross Revenue. With respect to any fiscal period, (a) no more than
twenty-five percent (25%) of Gross Revenue for such fiscal period shall be
derived from one Person who is a tenant of one or more Real Properties within
the Unencumbered Pool and/or Affiliates of such Person; provided, however, that
notwithstanding the foregoing, so long as the unsecured debt of Costco Wholesale
Corp. ("Costco") is rated A- or better by Standard & Poor's, then no more than
thirty percent (30%) of Gross Revenue for such fiscal period may be derived from
Costco through its tenancy of one or more Real Properties within the
Unencumbered Pool), (b) no less than forty percent (40%) of Gross Revenue for
such fiscal period shall be derived from Rated Tenants, (c) no less than
twenty-five percent (25%) of Gross Revenue for such fiscal period shall be
derived from Credit Tenants and (d) no more than fifteen percent (15%) of Gross
Revenue for such fiscal period shall be derived from restaurants.
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ARTICLE 9
UNENCUMBERED ASSETS
9.1 Designation of Unencumbered Assets. As of the date of this
Agreement, all Unencumbered Assets are described on Schedule 9.1 and constitute
the initial Unencumbered Pool. Subject to the terms and conditions of this
Agreement, Borrower may designate additional Real Property as an Unencumbered
Asset. In order to designate any Real Property as an Unencumbered Asset to be
added to the Unencumbered Pool, Borrower shall give Agent written notice
("Unencumbered Asset Notice") that Borrower intends to so designate such Real
Property. Each Unencumbered Asset Notice shall include, with respect to the Real
Property covered by such Unencumbered Asset Notice, the Property Information
with respect to such Real Property, and such other information and items as may
be reasonably requested by Agent with respect to such Real Property. Agent shall
deliver to the Lenders, promptly after their receipt by Agent, copies of each
Unencumbered Asset Notice, the Property Information with respect to the Real
Property covered by such Unencumbered Asset Notice and such other information
and items as may be delivered to Agent by Borrower pursuant to the preceding
sentence. Agent shall give Borrower written notice of whether Requisite Lenders
approve (which approval shall not be unreasonably withheld) the designation of
the Real Property covered by an Unencumbered Asset Notice as an Unencumbered
Asset to be added to the Unencumbered Pool within thirty (30) days after Agent's
receipt of such Unencumbered Asset Notice. If Agent fails to respond to an
Unencumbered Asset Notice within such 30-day period, Requisite Lenders shall be
deemed to have approved the designation of such Real Property as an
Unencumbered Asset to be added to the Unencumbered Pool and, effective upon the
expiration of such 30-day period, such Real Property shall be added to the
Unencumbered Pool.
9.2 Removal of Unencumbered Assets from Unencumbered Pool. If, after any
Real Property is added to the Unencumbered Pool as an Unencumbered Asset, such
Real Property (including any of the properties listed on Schedule 9.1) no longer
satisfies any of the conditions set forth in clauses (i) through (vii),
inclusive, of the definition of "Unencumbered Asset", which it satisfied at the
time of its addition to the Unencumbered Pool, Requisite Lenders shall have the
right, at any time and from time to time, to notify the Borrower that, effective
upon the giving of such notice, such asset shall no longer be considered an
Unencumbered Asset. If the Borrower at any time intends to withdraw any Real
Property from the Unencumbered Pool, it shall give the Agent written notice of
its intention, and deliver to the Agent, concurrently with such written notice,
a certificate of an Executive Officer setting
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forth the calculations establishing that the Borrower will be in compliance with
Section 8.3 with giving effect to such withdrawal (and any concurrent addition
of Real Properties to the Unencumbered Pool), which calculations shall be in
such detail, and otherwise in such form and substance, as Agent reasonably
requires, and certifying that, as of the date of such certificate, no Event of
Default or Unmatured Event of Default exists and that, after giving effect to
such withdrawal, no Event of Default or Unmatured Event of Default will exist.
Effective automatically on the date occurring 15 days after Agent's receipt of
such notice and certificate, such Real Property shall no longer constitute an
Unencumbered Asset.
9.3 Site Inspections; Structural Inspections; and Environmental Site
Assessments. Without limiting any other term or provision of this Agreement,
Agent and the Lenders shall have the right, upon reasonable notice and during
normal business hours, to inspect any Unencumbered Asset in the Unencumbered
Pool. The Agent may at any time request that Borrower deliver to Agent, within
thirty (30) days after the Agent's request, (i) a structural inspection report
with respect to any Unencumbered Asset in the Unencumbered Pool if the Agent
reasonably believes that such structural inspection report will disclose that
corrective work needs to be done to such Unencumbered Asset and (ii) an
environmental site assessment with respect to any Unencumbered Asset in the
Unencumbered Pool if the Agent reasonably believes that Borrower (with respect
to such Unencumbered Asset) and/or such Unencumbered Asset is not in material
compliance with all Environmental Laws.
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ARTICLE 10
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
10.1 Events of Default. Each of the following occurrences shall
constitute an Event of Default under this Agreement:
(a) Borrower shall fail to pay (i) any amount due on the
Maturity Date, (ii) any principal on any of the Notes when due, or (iii) any
interest on any Advance, or any fee or other amount payable under any Loan
Documents within three (3) days after the same becomes due.
(b) Borrower shall breach any covenant set forth in Section 6.11
or 8.7.
(c) Borrower shall fail duly and punctually to perform or
observe any term, agreement, covenant or obligation on its part to be performed
or observed under this Agreement or under any other Loan Document (other than as
described in any other provision of this Section 10.1), and such failure shall
continue for thirty (30) days after Borrower knew of such failure (or such
lesser period of time as is mandated by applicable Requirements of Law);
provided that, if cure cannot reasonably be effected within such 30-day period,
such failure shall not be an Event of Default so long as Borrower promptly (in
any event, within 10 days after Borrower knew of such failure) commences cure,
and thereafter diligently (in any event, within 90 days after Borrower knew of
such failure) prosecutes such cure to completion.
(d) Any representation or warranty made or deemed made by
Borrower to Agent or any Lender in this Agreement or in any other Loan Document
or in any statement, certificate or financial statements at any time given by
Borrower pursuant to any of the Loan Documents shall be false or misleading in
any material respect on the date as of which made.
(e) Borrower or any Consolidated Entity shall have defaulted on
any monetary obligation (30 days beyond any due date) under any Debt of such
party (other than the Obligations) if the aggregate amount of such Debt is Five
Million Dollars ($5,000,000) or more.
(f) Borrower or any Consolidated Entity institutes or consents
to the institution of any proceeding under a Debtor Relief Law relating to it or
to all or any material part of its Property, or is unable or admits in writing
its inability to pay its debts as they mature, or makes an assignment for the
benefit of creditors; or applies for or consents to the appointment of any
receiver, trustee, custodian, conservator,
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liquidator, rehabilitator or similar officer for it or for all or any material
part of its Property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of Borrower or such Consolidated Entity and the
appointment continues undischarged or unstayed for sixty (60) calendar days; or
any proceeding under a Debtor Relief Law relating to Borrower or any
Consolidated Entity or to all or any part of Borrower's or such Consolidated
Entity's Property is instituted without the consent of Borrower or such
Consolidated Entity and continues undismissed or unstayed for sixty (60)
calendar days.
(g) (i) Any money judgment (other than a money judgment covered
by insurance but only if the insurer has admitted liability with respect to such
money judgment), writ or warrant of attachment, or similar process involving in
any case an amount in excess of Two Million Dollars ($2,000,000.00) shall be
entered or filed against the Borrower, any Consolidated Entity or their
respective assets and shall remain undischarged, unvacated, unbonded or unstayed
for a period of ninety (90) days, or (ii) any judgment or order of any court or
administrative agency awarding material damages shall be entered against any
such Person in any action under the Federal securities laws seeking rescission
of the purchase or sale of, or for damages arising from the purchase or sale of,
any Securities, such judgment or order shall have become final after exhaustion
of all available appellate remedies and, in Agent's judgment, the payment of
such judgment or order would have a Material Adverse Effect on such Person.
(h) Any order, judgment or decree shall be entered against the
Borrower or any Consolidated Entity decreeing its involuntary dissolution or
split up and such order shall remain undischarged and unstayed for a period in
excess of sixty (60) days; or the Borrower or any Consolidated Entity shall
otherwise dissolve or cease to exist.
(i) If for any reason any Loan Document shall cease to be in
full force and effect and such condition or event shall continue for fifteen
(15) days after Borrower knew of such condition or event.
(j) Any Termination Event occurs which will or is reasonably
likely to subject Borrower or any ERISA Affiliate of Borrower to a liability
which Agent reasonably determines will constitute a Material Adverse Effect, or
the plan administrator of any Benefit Plan applies for approval under Section
412(d) of the Internal Revenue Code for a waiver of the minimum funding
standards of Section 412(a) of the Internal Revenue Code and Agent reasonably
determines that the business hardship upon which the Section 412(d) waiver was
based will or would reasonably be anticipated to subject Borrower to a liability
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which Agent determines will constitute a Material Adverse Effect.
(k) Borrower or any Consolidated Entity becomes subject to any
Liabilities and Costs which Agent reasonably deems to constitute a Material
Adverse Effect arising out of or related to (i) the Release or threatened
Release at any Property of any Contaminant into the environment, or any Remedial
Action in response thereto, or (ii) any violation of any Environmental Laws.
(l) Borrower or any Guarantor shall cease to be Solvent.
(m) Any Guarantor shall fail to duly and punctually perform or
observe any term, agreement, covenant or obligation under the Guaranty executed
by such Guarantor.
(n) Any Guaranty is repudiated, revoked or terminated without
Lenders' prior written consent, or any Guarantor claims that the Guaranty
executed by such Guarantor is ineffective or unenforceable, in whole or in part
and for any reason, with respect to amounts then outstanding or amounts that
might in the future be outstanding.
(o) The occurrence of an "Event of Default" under any loan or
other credit agreement between Xxxxx Fargo and Borrower or under any "Loan
Document" as defined in such loan or other credit agreement, when such loan or
other credit agreement recites or otherwise refers to this Section 10.1(o).
(p) The occurrence of an Event of Default (as such term is or
may hereafter be defined in any other Loan Document) under any other Loan
Document.
(q) Excel Legacy Corporation defaults under any loan or other
credit agreement or promissory note executed by Excel Legacy Corporation or a
default or event of default occurs under such loan or other credit agreement or
promissory note (subject to any applicable cure period(s)).
(r) Without the prior written consent of Requisite Lenders,
Excel Legacy Corporation sells or otherwise transfers, while this Agreement
remains in effect, more than twenty percent (20%) of the outstanding shares of
the common stock of Borrower (measured as of the date of this Agreement).
(s) Less than 2,000,000 shares of the Preferred Stock are owned
by Persons other than Excel Legacy Corporation and/or Affiliates of Excel Legacy
Corporation.
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(t) The Shareholder Agreement is amended or otherwise modified
without the prior written consent of Agent.
10.2 Remedies Upon Event of Default. Without limiting any other rights
or remedies of the Agent or the Lenders provided for elsewhere in this
Agreement, or the other Loan Documents, or by applicable Law, or in equity, or
otherwise:
(a) Upon the occurrence, and during the continuance, of any
Event of Default other than an Event of Default described in Section
10.1(f):
(1) the Commitments to make Advances and all other
obligations of the Agent or the Lenders and all rights of Borrower under
the Loan Documents shall be suspended without notice to or demand upon
Borrower, which are expressly waived by Borrower, except that all of the
Lenders or the Requisite Lenders (as the case may be, in accordance with
Section 12.4) may waive an Event of Default or, without waiving,
determine, upon terms and conditions satisfactory to the Lenders or
Requisite Lenders, as the case may be, to reinstate the Commitments and
such other obligations and rights and make further Advances, which
waiver or determination shall apply equally to, and shall be binding
upon, all the Lenders; and
(2) the Requisite Lenders may request the Agent to, and
the Agent thereupon shall, terminate the Commitment and/or declare all
or any part of the unpaid principal of all Notes, all interest accrued
and unpaid thereon and all other amounts payable under the Loan
Documents to be forthwith due and payable, whereupon the same shall
become and be forthwith due and payable, without protest, presentment,
notice of dishonor, demand or further notice of any kind, all of which
are expressly waived by Borrower.
(b) Upon the occurrence of any Event of Default described in
Section 10.1(f):
(1) the Commitments to make Advances and all other
obligations of the Agent or the Lenders and all rights of Borrower under
the Loan Documents shall terminate without notice to or demand upon
Borrower, which are expressly waived by Borrower, except that all of the
Lenders may waive the Event of Default or, without waiving, determine,
upon terms and conditions satisfactory to all the Lenders, to reinstate
the Commitments and such other obligations and rights and
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make further Advances, which determination shall apply equally to, and
shall be binding upon, all the Lenders; and
(2) the unpaid principal of all Notes, all interest
accrued and unpaid thereon and all other amounts payable under the Loan
Documents shall be forthwith due and payable, without protest,
presentment, notice of dishonor, demand or further notice of any kind,
all of which are expressly waived by Borrower.
(c) Upon the occurrence of any Event of Default, the Lenders and
the Agent, or any of them, without notice to (except as expressly
provided for in any Loan Document) or demand upon Borrower, which are
expressly waived by Borrower (except as to notices expressly provided
for in any Loan Document), may proceed (but only with the consent of the
Requisite Lenders) to protect, exercise and enforce their rights and
remedies under the Loan Documents against Borrower and any other Party
and such other rights and remedies as are provided by Law or equity.
(d) The order and manner in which the Lenders' rights and
remedies are to be exercised shall be determined by the Requisite
Lenders in their sole discretion, and all payments received by the Agent
and the Lenders, or any of them, shall be applied first to the costs and
expenses (including reasonable attorneys' fees and disbursements and
the reasonably allocated costs of attorneys employed by the Agent or by
any Lender) of the Agent and of the Lenders, and thereafter paid pro
rata to the Lenders in the same proportions that the aggregate
Obligations owed to each Lender under the Loan Documents bear to the
aggregate Obligations owed under the Loan Documents to all the Lenders,
without priority or preference among the Lenders. Regardless of how each
Lender may treat payments for the purpose of its own accounting, for the
purpose of computing Borrowers' Obligations hereunder and under the
Notes, payments shall be applied first, to the costs and expenses of the
Agent and the Lenders, as set forth above, second, to the payment of
accrued and unpaid interest due under any Loan Documents to and
including the date of such application (ratably, and without
duplication, according to the accrued and unpaid interest due under each
of the Loan Documents), and third, to the payment of all other amounts
(including principal and fees) then owing to the Agent or the Lenders
under the Loan Documents. No application of payments will cure any Event
of Default, or prevent acceleration, or continued acceleration, of
amounts
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payable under the Loan Documents, or prevent the exercise, or continued
exercise, of rights or remedies of the Lenders hereunder or thereunder
or at Law or in equity.
(e) If an Event of Default then exists, Agent shall have, in
addition to and not by way of a limitation on any other rights and remedies
contained in this Agreement or in the other Loan Documents, the right within
forty-eight (48) hours after notice to Borrower to obtain access to Borrower's
records (including computerized information, files and supporting software)
relating to the Unencumbered Assets, and its accounting information relating to
the Unencumbered Assets, and to use all of the foregoing and the information
contained therein in any manner Agent deems appropriate which is related to the
collection of the Obligations. Borrower hereby irrevocably authorizes any
accountant or management agent employed by Borrower to deliver such items and
information to Agent. Notwithstanding anything to the contrary contained in the
Loan Documents, upon the occurrence of and during the continuance of an Event of
Default, Agent shall be entitled to request and receive, by or through Borrower
or appropriate legal process, any and all information concerning the Borrower,
any Consolidated Entity or any Property of any of them, which is reasonably
available to or obtainable by Borrower. Agent shall deliver to each Lender
copies of any information which it obtains pursuant to this Section 10.2(e).
(f) Demand, presentment, protest and notice of nonpayment are
hereby waived by Borrower. Borrower also waives, to the extent permitted by law,
the benefit of all valuation, appraisal and exemption laws.
(g) No delay or omission of Agent or Lenders to exercise any
right under any Loan Document shall impair such right or be construed to be a
waiver of any Event of Default or an acquiescence therein, and any single or
partial exercise of any such right shall not preclude other or further exercise
thereof or the exercise of any other right, and no waiver, amendment or other
variation of the terms, conditions or provisions of the Loan Documents
whatsoever shall be valid unless in a writing signed by Agent after obtaining
written approval thereof or the signature thereon of those Lenders required to
approve such waiver, amendment or other variation, and then only to the extent
in such writing specifically set forth. All remedies contained in the Loan
Documents or by law afforded shall be cumulative and all shall be available to
Agent and Lenders until the Obligations have been paid in full, the Commitment
has expired or terminated and this Agreement has been terminated.
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ARTICLE 11
AGENCY PROVISIONS
11.1 Appointment and Authorization. Subject to Section 11.8, each Lender
hereby irrevocably appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers under the Loan Documents as are
delegated to the Agent by the terms thereof or are reasonably incidental, as
determined by the Agent, thereto. This appointment and authorization is intended
solely for the purpose of facilitating the servicing of the Advances and does
not constitute appointment of the Agent as trustee for any Lender or as
representative of any Lender for any other purpose and, except as specifically
set forth in the Loan Documents to the contrary, the Agent shall take such
action and exercise such powers only in an administrative and ministerial
capacity.
11.2 Agent and Affiliates. Xxxxx Fargo (and each successor Agent) has
the same rights and powers under the Loan Documents as any other Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" includes Xxxxx Fargo in its individual capacity. Xxxxx Fargo (and each
successor Agent) and its Affiliates may accept deposits from, lend money to and
generally engage in any kind of banking, trust or other business with Borrower,
any Subsidiary thereof, or any Affiliate of Borrower or any Subsidiary thereof,
as if it were not the Agent and without any duty to account therefor to the
Lenders. Xxxxx Fargo (and each successor Agent) need not account to any other
Lender for any monies received by it for reimbursement of its costs and expenses
as Agent hereunder, or for any monies received by it in its capacity as a Lender
hereunder. The Agent shall not be deemed to hold a fiduciary relationship with
any Lender and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise exist
against the Agent.
11.3 Proportionate Interest in any Collateral. The Agent, on behalf of
all the Lenders, shall hold in accordance with the Loan Documents all items of
any collateral or interests therein received or held by the Agent. Subject to
the Agent's and the Lenders' rights to reimbursement for their costs and
expenses hereunder (including reasonable attorneys' fees and disbursements and
other professional services and the reasonably allocated costs of attorneys
employed by the Agent or a Lender) and subject to the application of payments in
accordance with Section 10.2(d), each Lender shall have an interest in the
Lenders' interest in such collateral or interests therein in the same
proportions that the aggregate Obligations owed such Lender under the Loan
Documents bear to the
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aggregate Obligations owed under the Loan Documents to all the Lenders, without
priority or preference among the Lenders.
11.4 Lenders' Credit Decisions. Each Lender agrees that it has,
independently and without reliance upon the Agent, any other Lender or the
directors, officers, agents, employees or attorneys of the Agent or of any other
Lender, and instead in reliance upon information supplied to it by or on behalf
of Borrower and upon such other information as it has deemed appropriate, made
its own independent credit analysis and decision to enter into this Agreement.
Each Lender also agrees that it shall, independently and without reliance upon
the Agent, any other Lender or the directors, officers, agents, employees or
attorneys of the Agent or of any other Lender, continue to make its own
independent credit analyses and decisions in acting or not acting under the
Loan Documents.
11.5 Action by Agent.
(a) Absent actual knowledge of the Agent of the existence of an
Unmatured Event of Default or Event of Default, the Agent may assume that no
Unmatured Event of Default or Event of Default has occurred and is continuing,
unless the Agent (or the Lender that is then the Agent) has received notice from
Borrower stating the nature of the Unmatured Event of Default or Event of
Default or has received notice from a Lender stating the nature of the Unmatured
Event of Default or the Event of Default and that such Lender considers the
Unmatured Event Default or Event of Default to have occurred and to be
continuing.
(b) The Agent has only those obligations under the Loan
Documents as are expressly set forth therein.
(c) Except for any obligation expressly set forth in the Loan
Documents and as long as the Agent may assume that no Event of Default has
occurred and is continuing, the Agent may, but shall not be required to,
exercise its discretion to act or not act, except that the Agent shall be
required to act or not act upon the instructions of the Requisite Lenders (or of
all the Lenders, to the extent required by Section 12.4) and those instructions
shall be binding upon the Agent and all the Lenders, provided that the Agent
shall not be required to act or not act if to do so would be contrary to any
Loan Document or to applicable Law or would result, in the reasonable judgment
of the Agent, in substantial risk of liability to the Agent.
(d) If the Agent has received a notice specified in clause (a),
the Agent shall immediately give notice thereof to the Lenders and shall act or
not act upon the instructions of the Requisite Lenders (or of all the Lenders,
to the extent
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required by Section 12.4), provided that the Agent shall not be required to act
or not act if to do so would be contrary to any Loan Document or to applicable
Law or would result, in the reasonable judgment of the Agent, in substantial
risk of liability to the Agent, and except that if the Requisite Lenders (or all
the Lenders, if required under Section 12.4) fail, for five (5) Banking Days
after the receipt of notice from the Agent, to instruct the Agent, then the
Agent, in its sole discretion, may act or not act as it deems advisable for the
protection of the interests of the Lenders.
(e) The Agent shall have no liability to any Lender for acting,
or not acting, as instructed by the Requisite Lenders (or all the Lenders, if
required under Section 12.4), notwithstanding any other provision hereof.
11.6 Liability of Agent. Neither the Agent nor any of its directors,
officers, agents, employees or attorneys shall be liable for any action taken or
not taken by them under or in connection with the Loan Documents, except for
their own gross negligence or willful misconduct. Without limitation on the
foregoing, the Agent and its directors, officers, agents, employees and
attorneys:
(a) May treat the payee of any Note as the holder thereof until
the Agent receives notice of the assignment or transfer thereof, in form
satisfactory to the Agent, signed by the payee, and may treat each Lender as the
owner of that Lender's interest in the Obligations for all purposes of this
Agreement until the Agent receives notice of the assignment or transfer thereof,
in form satisfactory to the Agent, signed by that Lender;
(b) May consult with legal counsel (including in-house legal
counsel), accountants (including in-house accountants) and other professionals
or experts selected by it, or with legal counsel, accountants or other
professionals or experts for Borrower and/or their Subsidiaries or the Lenders,
and shall not be liable for any action taken or not taken by it in good faith in
accordance with any advice of such legal counsel, accountants or other
professionals or experts;
(c) Shall not be responsible to any Lender for any statement,
warranty or representation made in any of the Loan Documents or in any notice,
certificate, report, request or other statement (written or oral) given or made
in connection with any of the Loan Documents;
(d) Except to the extent expressly set forth in the Loan
Documents, shall have no duty to ask or inquire as to the performance or
observance by Borrower or its Subsidiaries of any of the terms, conditions or
covenants of any of the Loan
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Documents or to inspect any collateral or any Property, books or records of
Borrower or its Subsidiaries;
(e) Will not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, effectiveness, sufficiency or
value of any Loan Document, any other instrument or writing furnished pursuant
thereto or in connection therewith, or any collateral;
(f) Will not incur any liability by acting or not acting in
reliance upon any Loan Document, notice, consent, certificate, statement,
request or other instrument or writing believed in good faith by it to be
genuine and signed or sent by the proper party or parties; and
(g) Will not incur any liability for any arithmetical error in
computing any amount paid or payable by Borrower or any Subsidiary or Affiliate
thereof or paid or payable to or received or receivable from any Lender under
any Loan Document, including, without limitation, principal, interest,
commitment fees, Advances and other amounts; provided that, promptly upon
discovery of such an error in computation, the Agent, the Lenders and (to the
extent applicable) Borrower and/or its Subsidiaries or Affiliates shall make
such adjustments as are necessary to correct such error and to restore the
parties to the position that they would have occupied had the error not
occurred.
11.7 Indemnification. Each Lender shall, ratably in accordance with its
Pro Rata Share of the Commitment (if the Commitment is then in effect) or in
accordance with its proportion of the aggregate indebtedness then evidenced by
the Notes (if the Commitment has then been terminated), indemnify and hold the
Agent and its directors, officers, agents, employees and attorneys harmless
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever (including reasonable attorneys' fees and disbursements and
allocated costs of attorneys employed by the Agent) that may be imposed on,
incurred by or asserted against it or them in any way relating to or arising out
of the Loan Documents (other than losses incurred by reason of the failure of
Borrower to pay the indebtedness represented by the Notes) or any action taken
or not taken by it as Agent thereunder, except such as result from its own gross
negligence or willful misconduct. Without limitation on the foregoing, each
Lender shall reimburse the Agent upon demand for that Lender's Pro Rata Share of
any out-of-pocket cost or expense incurred by the Agent in connection with the
negotiation, preparation, execution, delivery, amendment, waiver,
restructuring, reorganization (including a bankruptcy reorganization),
enforcement or attempted enforcement of the Loan Documents, to the extent that
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Borrower or any other Party is required by Section 12.1 to pay that cost or
expense but fails to do so upon demand. Nothing in this Section 11.7 shall
entitle the Agent or any indemnitee referred to above to recover any amount from
the Lenders if and to the extent that such amount has theretofore been recovered
from Borrower or any of its Subsidiaries. To the extent that the Agent or any
indemnitee referred to above is later reimbursed such amount by Borrower or any
of its Subsidiaries, it shall return the amounts paid to it by the Lenders in
respect of such amount.
11.8 Successor Agent. The Agent may, and at the request of all Lenders
(other than Agent) shall, resign as Agent upon reasonable notice to the Lenders
and Borrower effective upon acceptance of appointment by a successor Agent. If
the Agent shall resign as Agent under this Agreement, the Requisite Lenders
shall appoint from among the Lenders a successor Agent for the Lenders, which
successor Agent shall be approved by Borrower (and such approval shall not be
unreasonably withheld or delayed). If no successor Agent is appointed prior to
the effective date of the resignation of the Agent, the Agent may appoint, after
consulting with the Lenders and Borrower, a successor Agent from among the
Lenders. Upon the acceptance of its appointment as successor Agent hereunder,
such successor Agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor Agent and the
retiring Agent's appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Article 11, and Sections 12.1 and 12.2, shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Agent under this
Agreement. Notwithstanding the foregoing, if (a) the Agent has not been paid its
agency fees under this Agreement or has not been reimbursed for any expense
reimbursable to it under Section 12.1, in either case for a period of at least
one (1) year and (b) no successor Agent has accepted appointment as Agent by the
date which is thirty (30) days following a retiring Agent's notice of
resignation, the retiring Agent's resignation shall nevertheless thereupon
become effective and the Lenders shall perform all of the duties of the Agent
hereunder until such time, if any, as the Requisite Lenders appoint a successor
Agent as provided for above.
11.9 No Obligations of Borrower. Nothing contained in this Article 11
shall be deemed to impose upon Borrower any obligation in respect of the due and
punctual performance by the Agent of its obligations to the Lenders under any
provision of this Agreement, and Borrower shall have no liability to the Agent
or any of the Lenders in respect of any failure by the Agent or any Lender to
perform any of its obligations to the Agent or the Lenders under this Agreement.
Without limiting
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the generality of the foregoing, where any provision of this Agreement relating
to the payment of any amounts due and owing under the Loan Documents provides
that such payments shall be made by Borrower to the Agent for the account of the
Lenders, Borrower's obligations to the Lenders in respect of such payments shall
be deemed to be satisfied upon the making of such payments to the Agent in the
manner provided by this Agreement. In addition, Borrower may rely on a written
statement by the Agent to the effect that it has obtained the written consent of
the Requisite Lenders or all of the Lenders, as applicable under Section 12.4,
in connection with a waiver, amendment, consent, approval or other action by the
Lenders hereunder, and shall have no obligation to verify or confirm the same.
11.10 Disbursements of Advances.
(a) Promptly, but in any event not later than 5:00 p.m. (San
Francisco time) on the same Business Day on which Agent receives a Notice of
Borrowing, Agent shall send a copy thereof by facsimile to each other Lender and
shall otherwise notify each Lender of the proposed Advance and the Funding Date.
Each Lender shall make available to Agent (or the funding bank or entity
designated by Agent), the amount of such Lender's Pro Rata Share of such Advance
in immediately available funds not later than the times designated in Section
11.10(b). Unless Agent shall have been notified by any Lender not later than the
close of business (San Francisco time) on the Business Day immediately preceding
the Funding Date in respect of any Advance that such Lender does not intend to
make available to Agent such Lender's Pro Rata Share of such Advance, Agent may
assume that such Lender shall make such amount available to Agent. If any Lender
does not notify Agent of its intention not to make available its Pro Rata Share
of such Advance as described above, but does not for any reason make available
to Agent such Lender's Pro Rata Share of such Advance, such Lender shall pay to
Agent forthwith on demand such amount, together with interest thereon at the
Federal Funds Rate. In any case where a Lender does not for any reason make
available to Agent such Lender's Pro Rata Share of such Advance, Agent, in its
sole discretion, may, but shall not be obligated to, fund to Borrower such
Lender's Pro Rata Share of such Advance. If Agent funds to Borrower such
Lender's Pro Rata Share of such Advance and if such Lender subsequently pays to
Agent such corresponding amount, such amount so paid shall constitute such
Lender's Pro Rata Share of such Advance. Nothing in this Section 11.10(a) shall
alter the respective rights and obligations of the parties hereunder in respect
of a Defaulting Lender or a Non-Pro Rata Advance.
(b) Requests by Agent for funding by Lenders of Advances will be
made by telecopy. Each Lender shall make the
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amount of its Advance available to Agent in Dollars and in immediately available
funds, to such bank and account, in El Segundo, California as Agent may
designate, not later than 9:00 A.M. (San Francisco time) on the Funding Date
designated in the Notice of Borrowing with respect to such Advance, but in no
event earlier than two (2) Business Days following such Lender's receipt of the
applicable Notice of Borrowing.
(c) Nothing in this Section 11.10 shall be deemed to relieve any
Lender of its obligation hereunder to make its Pro Rata Share of any Advance on
the applicable Funding Date, nor shall any Lender be responsible for the failure
of any other Lender to perform its obligations to make any Advance hereunder,
and the Pro Rata Share of any Lender shall not be increased or decreased as a
result of the failure by any other Lender to perform its obligation to make an
Advance.
11.11 Distribution and Apportionment of Payments.
(a) Subject to Section 11.11(b), payments actually received by
Agent for the account of Lenders shall be paid to them promptly after receipt
thereof by Agent, but in any event within one (1) Business Day, provided that
Agent shall pay to Lenders interest thereon, at the Federal Funds Rate, from the
Business Day following receipt of such funds by Agent until such funds are paid
in immediately available funds to Lenders. Subject to Section 11.11(b), all
payments of principal and interest in respect of outstanding Advances, all
payments of the fees described in this Agreement, and all payments in respect of
any other Obligations shall be allocated among such Lenders as are entitled
thereto, in proportion to their respective Pro Rata Shares or otherwise as
provided herein. Agent shall promptly distribute, but in any event within one
(1) Business Day after it receives the same, to each Lender at its primary
address set forth on the appropriate signature page hereof or on the Assignment
and Assumption, or at such other address as a Lender may request in writing,
such funds as it may be entitled to receive; provided that Agent shall in any
event not be bound to inquire into or determine the validity, scope or priority
of any interest or entitlement of any Lender and may suspend all payments and
seek appropriate relief (including, without limitation, instructions from
Requisite Lenders or all Lenders, as applicable, or an action in the nature of
interpleader) in the event of any doubt or dispute as to any apportionment or
distribution contemplated hereby. The order of priority herein is set forth
solely to determine the rights and priorities of Lenders as among themselves and
may at any time or from time to time be changed by Lenders as they may elect, in
writing in accordance with Section 12.4, without necessity of notice to or
consent of or approval by Borrower or any other Person. All payments or other
sums received by Agent for the account of Lenders (including, without
limitation,
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principal and interest payments) shall not constitute property or assets of the
Agent and shall be held by Agent, solely in its capacity as agent for itself and
the other Lenders, subject to the Loan Documents.
(b) Notwithstanding any provision hereof to the contrary, until
such time as a Defaulting Lender has funded its Pro Rata Share of any Advance
which was previously a Non-Pro Rata Advance, or all other Lenders have received
payment in full (whether by repayment or prepayment) of the principal and
interest due in respect of such Non-Pro Rata Advance, all of the Obligations
owing to such Defaulting Lender hereunder shall be subordinated in right of
payment, as provided in the following sentence, to the prior payment in full of
all principal, interest and fees in respect of all Non-Pro Rata Advances in
which the Defaulting Lender has not funded its Pro Rata Share (such principal,
interest and fees being referred to as "Senior Loans"). All amounts paid by
Borrower and otherwise due to be applied to the Obligations owing to the
Defaulting Lender pursuant to the terms hereof shall be distributed by Agent to
the other Lenders in accordance with their respective Pro Rata Shares
(recalculated for purposes hereof to exclude the Defaulting Lender's Pro Rata
Share of the Commitment), until all Senior Loans have been paid in full. This
provision governs only the relationship among Agent, each Defaulting Lender and
the other Lenders; nothing hereunder shall limit the obligation of Borrower to
repay all Advances in accordance with the terms of this Agreement, nor create an
Event of Default if payments are not made to a Defaulting Lender. The provisions
of this Section shall apply and be effective regardless of whether an Event of
Default occurs and is then continuing, and notwithstanding (i) any other
provision of this Agreement to the contrary, (ii) any instruction of Borrower as
to its desired application of payments or (iii) the suspension of such
Defaulting Lender's right to vote on matters which are subject to the consent or
approval of Requisite Lenders or all Lenders. No Unused Facility Fee shall
accrue in favor of, or be payable to, such Defaulting Lender from the date of
any failure to fund Advances or reimburse Agent for any Liabilities and Costs as
herein provided until such failure has been cured, and Agent shall be entitled
to (A) withhold or setoff, and to apply to the payment of the defaulted amount
and any related interest, any amounts to be paid to such Defaulting Lender under
this Agreement, and (B) bring an action or suit against such Defaulting Lender
in a court of competent jurisdiction to recover the defaulted amount and any
related interest. In addition, the Defaulting Lender shall indemnify, defend and
hold Agent and each of the other Lenders harmless from and against any and all
Liabilities and Costs, plus interest thereon at a default rate of interest which
is five percent (5%) per annum in excess of the Base Rate, which they may
sustain or incur by reason of or as a direct consequence of the
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Defaulting Lender's failure or refusal to abide by its obligations under this
Agreement.
11.12 Consent and Approvals.
(a) Agent may at any time request instructions from Requisite
Lenders with respect to any actions or approvals which, by the terms of this
Agreement or of any of the Loan Documents, Agent is permitted or required to
take or to grant without instructions from any Lenders and if such instructions
are promptly requested, Agent shall be absolutely entitled to refrain from
taking any action or to withhold any approval and shall not be under any
liability whatsoever to any Person for refraining from taking any action or
withholding any approval under any of the Loan Documents until it shall have
received such instructions from Requisite Lenders. Without limiting the
foregoing, no Lender shall have any right of action whatsoever against Agent as
a result of Agent acting or refraining from acting under this Agreement, or any
of the other Loan Documents in accordance with the instructions of Requisite
Lenders or, where applicable, all Lenders. Agent shall promptly notify each
Lender at any time that the Requisite Lenders have instructed Agent to act or
refrain from acting pursuant hereto.
(b) Each Lender agrees that any action taken by Agent at the
direction or with the consent of Requisite Lenders in accordance with the
provisions of this Agreement or any Loan Document, and the exercise by Agent at
the direction or with the consent of Requisite Lenders of the powers set forth
herein or therein, together with such other powers as are reasonably incidental
thereto, shall be authorized and binding upon all Lenders, except for actions
specifically requiring the approval of all Lenders. All communications from
Agent to Lenders requesting Lenders' determination, consent, approval or
disapproval (i) shall be given in the form of a written notice to each Lender,
(ii) shall be accompanied by a description of the matter or thing as to which
such determination, approval, consent or disapproval is requested, or shall
advise each Lender where such matter or thing may be inspected, or shall
otherwise describe the matter or issue to be resolved, (iii) shall include, if
reasonably requested by a Lender and to the extent not previously provided to
such Lender, written materials and a summary of all oral information provided to
Agent by Borrower in respect of the matter or issue to be resolved, and (iv)
shall include Agent's recommended course of action or determination in respect
thereof. Each Lender shall reply promptly, but (except as otherwise provided in
Section 11.5(d)) in any event within ten (10) Business Days (the "Lender Reply
Period"). Unless a Lender shall give written notice to Agent that it objects to
the recommendation or determination of Agent (together with a written
explanation of the reasons behind such objection) within the Lender Reply
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Period, such Lender shall be deemed to have approved of or consented to such
recommendation or determination and Borrower and each other Lender may rely on
such approval as if given. With respect to decisions requiring the approval of
Requisite Lenders or all Lenders, Agent shall submit its recommendation or
determination for approval of or consent to such recommendation or
determination to all Lenders and upon receiving the required approval or consent
shall follow the course of action or determination recommended to Lenders by
Agent or such other course of action recommended by Requisite Lenders, and each
non-responding Lender shall be deemed to have concurred with such recommended
course of action.
11.13 Certain Agency Provisions Relating to Enforcement. Should Agent
(i) employ counsel for advice or other representation (whether or not any suit
has been or shall be filed) with respect to any of the Loan Documents, or (ii)
commence any proceeding or in any way seek to enforce its rights or remedies
under the Loan Documents, each Lender, upon demand therefor from time to time,
shall contribute its share (based on its Pro Rata Share) of the reasonable costs
and/or expenses of any such advice or other representation or enforcement,
including, but not limited to, court costs, title company charges, filing and
recording fees, appraisers' fees and fees and expenses of attorneys to the
extent not otherwise reimbursed by Borrower. Any loss of principal and/or
interest resulting from any Event of Default shall be shared by Lenders in
accordance with their respective Pro Rata Shares. It is understood and agreed
that in the event Agent determines it is necessary to engage counsel for Lenders
from and after the occurrence of an Event of Default, said counsel shall be
selected by Agent.
11.14 Ratable Sharing. Subject to Sections 11.10 and 11.11, Lenders
agree among themselves that (i) with respect to all amounts received by them
which are applicable to the payment of the Obligations, equitable adjustment
will be made so that, in effect, all such amounts will be shared among them
ratably in accordance with their Pro Rata Shares, whether received by voluntary
payment, by counterclaim or cross action or by the enforcement of any or all of
the Obligations, (ii) if any of them shall by voluntary payment or by the
exercise of any right of counterclaim or otherwise, receive payment of a
proportion of the aggregate amount of the Obligations held by it which is
greater than its Pro Rata Share of the payments on account of the Obligations,
the one receiving such excess payment shall purchase, without recourse or
warranty, an undivided interest and participation (which it shall be deemed to
have done simultaneously upon the receipt of such payment) in such Obligations
owed to the others so that all such recoveries with respect to such Obligations
shall be applied ratably in accordance with their Pro Rata Shares; provided,
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that if all or part of such excess payment received by the purchasing party is
thereafter recovered from it, those purchases shall be rescinded and the
purchase prices paid for such participations shall be returned to that party to
the extent necessary to adjust for such recovery, but without interest except to
the extent the purchasing party is required to pay interest in connection with
such recovery. Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section 11.14 may, to the fullest extent
permitted by law, exercise all its rights of payment with respect to such
participation as fully as if such Lender were the direct creditor of Borrower in
the amount of such participation. No Lender shall exercise any setoff, banker's
lien or other similar right in respect to any Obligations without the prior
written approval by Agent.
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ARTICLE 12
MISCELLANEOUS
12.1 Expenses.
(a) Generally. Borrower agrees to pay, or reimburse Agent for,
within seven (7) days after receipt of written demand, all of Agent's reasonable
external audit, legal, appraisal, valuation and investigation expenses and for
all other reasonable costs and expenses of every type and nature (including,
without limitation, the fees and charges of outside appraisers and reasonable
fees, expenses and disbursements of Agent's internal appraisers, environmental
advisors or legal counsel) incurred by Agent at any time (whether prior to, on
or after the date of this Agreement) in connection with (i) its own audit and
investigation of Borrower and the Consolidated Entities; (ii) the negotiation,
preparation and execution of this Agreement (including, without limitation, the
satisfaction or attempted satisfaction of any of the conditions set forth in
Article 3), and the other Loan Documents and the making of the Advances; (iii)
review and investigation of Real Property which is proposed for inclusion within
the Unencumbered Pool and Unencumbered Assets within the Unencumbered Pool; (iv)
administration of this Agreement, the other Loan Documents and the Advances,
including, without limitation, consultation with attorneys in connection
therewith; (v) syndication of, assignments of and participations in this
Agreement and the other Loan Documents; and (vi) the protection, collection or
enforcement of any of the Obligations.
(b) After Event of Default. Borrower further agrees to pay, or
reimburse Agent and Lenders, on demand for all reasonable out-of-pocket costs
and expenses, including, without limitation, the reasonable attorneys' fees and
disbursements incurred by Agent or Lenders after the occurrence and during the
continuance of an Event of Default (i) in enforcing any Obligation or exercising
or enforcing any other right or remedy available by reason of such Event of
Default; (ii) in connection with any refinancing or restructuring of the credit
arrangements provided under this Agreement in the nature of a "work-out" or in
any insolvency or bankruptcy proceeding; (iii) in commencing, defending or
intervening in any litigation or in filing a petition, complaint, answer, motion
or other pleadings in any legal proceeding relating to Borrower and related to
or arising out of the transactions contemplated hereby (other than suit or legal
proceedings solely between two or more Lenders and/or Agent); or (iv) in taking
any other action in or with respect to any suit or proceeding (whether in
bankruptcy or otherwise) (other than suit or legal proceedings solely between
two or more Lenders and/or Agent).
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12.2 Indemnity. Borrower further agrees to defend, protect, indemnify
and hold harmless Agent, each and all of the Lenders, each of their respective
Affiliates and each of the respective officers, directors, employees, agents,
attorneys and consultants (including, without limitation, those retained in
connection with the satisfaction or attempted satisfaction of any of the
conditions set forth in Article 3) of each of the foregoing (collectively called
the "Indemnitees") from and against any and all Liabilities and Costs imposed
on, incurred by, or asserted against such Indemnitees (whether based on any
federal or state laws or other statutory regulations, including, without
limitation, securities and commercial laws and regulations, under common law or
in equity, and based upon contract or otherwise, including any liability and
costs arising as a result of a "prohibited transaction" under ERISA to the
extent arising from or in connection with the past, present or future operations
of the Borrower or its predecessors in interest) in any manner relating to or
arising out of this Agreement or the other Loan Documents, or any act, event or
transaction related or attendant thereto, the making of and participation in the
Advances and the management of the Advances, or the use or intended use of the
proceeds of the Advances (collectively, the "Indemnified Matters"); provided,
however, that Borrower shall have no obligation to an Indemnitee hereunder with
respect to Indemnified Matters to the extent caused by or resulting from the
willful misconduct or gross negligence of that Indemnitee, as determined by a
court of competent jurisdiction. To the extent that the undertaking to
indemnify, pay and hold harmless set forth in the preceding sentence may be
unenforceable because it is violative of any law or public policy, Borrower
shall contribute the maximum portion which it is permitted to pay and satisfy
under applicable law to the payment and satisfaction of all Indemnified Matters
incurred by the Indemnitees.
12.3 Change in Accounting Principles and "Funds from Operations"
Definition. Except as otherwise provided herein, if any changes in accounting
principles from those used in the preparation of the most recent financial
statements delivered to Agent pursuant to the terms hereof are hereafter
required or permitted by the rules, regulations, pronouncements and opinions of
the Financial Accounting Standards Board or the American Institute of Certified
Public Accountants (or successors thereto or agencies with similar functions)
and are adopted by the Borrower with the agreement of its Accountants and such
changes result in a change in the method of calculation of any of the financial
covenants, standards or terms found herein, the parties hereto agree to enter
into negotiations in order to amend such provisions so as to equitably reflect
such changes with the desired result that the criteria for evaluating the
financial condition of the Borrower and the Consolidated Entities shall be the
same after such
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changes as if such changes had not been made; provided, however, that no change
in GAAP that would affect the method of calculation of any of the financial
covenants, standards or terms shall be given effect in such calculations until
such provisions are amended, in a manner satisfactory to Requisite Lenders, to
so reflect such change in accounting principles. The definition of "Funds from
Operations" set forth in Article 1 is based upon the definition of "Funds From
Operations" promulgated by the National Association of Real Estate Investment
Trusts and effective as of January 1, 1996 (the "NAREIT Definition"). If the
NAREIT Definition is modified after the date of this Agreement, the parties
hereto agree to enter into negotiations if any party so requests in order to
amend the definition of "Funds from Operations" set forth in this Agreement to
make it consistent with the modified NAREIT Definition; provided, however, that
no change in such definition of "Funds from Operations" shall be given effect
until such definition is amended, in a manner satisfactory to Requisite Lenders,
to so reflect such modification in the NAREIT Definition of "Funds From
Operations"; and provided further, however, that if the effect of such change in
the definition of "Funds from Operations" is to restrict the amount of
distributions permitted under this Agreement to amounts less than what are
required to maintain the Borrower's status as a real estate investment trust
under the Code, then Borrower shall be permitted to make such distribution which
would have been permitted under the "Funds from Operations" definition in effect
as of the Closing Date.
12.4 Amendments and Consents. (a) No amendment, modification,
supplement, extension, termination or waiver of any provision of this Agreement
or any other Loan Document, no approval or consent thereunder (unless otherwise
specifically provided to the contrary), and no consent to any departure by
Borrower therefrom, may in any event be effective without the written agreement
of Requisite Lenders (after notice to all Lenders) and Borrower, which Requisite
Lenders shall have the right to grant or withhold at their sole discretion,
except that the following amendments, modifications, supplements, extensions,
terminations or waivers shall require the written consent of all Lenders:
(i) increasing the Commitment and/or any Lender's Pro
Rata Share of the Commitment;
(ii) changing the principal amount or final maturity of
the Advances or otherwise changing the Maturity Date;
(iii) amending or otherwise modifying the interest rates
applicable to the Advances;
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(iv) reducing the rates on which fees payable pursuant
hereto are determined;
(v) forgiving or delaying any amount payable or
receivable under Article 2 (other than late fees in accordance with
Section 2.4(e));
(vi) changing the definition of "Requisite Lenders",
"Pro Rata Shares", "Tangible Net Worth", "Total Liabilities", "Gross
Asset Value", or "Unencumbered Asset Pool Value";
(vii) changing any provision contained in this Section
12.4;
(viii) releasing any obligor under any Loan Document,
unless such release is otherwise required or permitted by the terms of
this Agreement;
(ix) amending or otherwise modifying any Guaranty;
(x) amending or otherwise modifying Section 8.1, Section
8.2 and/or Section 8.3;
(xi) consenting to assignment by Borrower of all of its
duties and Obligations hereunder pursuant to Section 12.14; or
(xii) amending or otherwise modifying any provision of
this Agreement that expressly requires the consent or approval of all
the Lenders.
No amendment, modification, termination or waiver of any provision of Article 11
or any other provision referring to Agent shall be effective without the written
concurrence of Agent, but only if such amendment, modification, termination or
waiver alters the obligations or rights of Agent. Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given. No notice to or demand on Borrower in any case shall entitle
Borrower to any other further notice or demand in similar or other
circumstances. Any amendment, modification, termination, waiver or consent
effected in accordance with this Section 12.4 shall be binding on each assignee,
transferee or recipient of Agent's or any Lender's Pro Rata Share of the
Commitment under this Agreement or the Advances at the time outstanding.
Borrower shall be entitled to rely on any amendment or waiver executed by the
Agent on behalf of the Lenders provided that Agent certifies to Borrower that
Agent obtained the approvals or consents required under this Agreement of
Requisite Lenders or all Lenders, as the case may be.
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12.5 Independence of Covenants. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or be otherwise within the limitations of, another covenant shall not avoid
the occurrence of an Event of Default or Unmatured Event of Default if such
action is taken or condition exists, and if a particular action or condition is
expressly permitted under any covenant, unless expressly limited to such
covenant, the fact that it would not be permitted under the general provisions
of another covenant shall not constitute an Event of Default or Unmatured Event
of Default if such action is taken or condition exists.
12.6 Notices and Delivery. Unless otherwise specifically provided
herein, any consent, notice or other communication herein required or permitted
to be given shall be in writing and may be personally served, telecopied or sent
by courier service or United States mail and shall be deemed to have been given
when delivered in person or by courier service, upon receipt of a telecopy (or
on the next Business Day if such telecopy is received on a non-Business Day or
after 5:00 p.m. on a Business Day) or four (4) Business Days after deposit in
the United States mail (registered or certified, with postage prepaid and
properly addressed). Notices to Agent pursuant to Article 2 shall not be
effective until received by Agent. For the purposes hereof, the addresses of the
parties hereto (until notice of a change thereof is delivered as provided in
this Section 12.6) shall be as set forth below each party's name on the
signature pages hereof, or, as to each party, at such other address as may be
designated by such party in a written notice to all of the other parties. All
deliveries to be made to Agent for distribution to the Lenders shall be made to
Agent at the address specified for notice on the signature page hereto and in
addition, a sufficient number of copies of each such delivery shall be delivered
to Agent for delivery to each Lender at the address specified for deliveries on
the signature page hereto or such other address as may be designated by Agent in
a written notice.
12.7 Survival of Warranties, Indemnities and Agreements. All agreements,
representations, warranties and indemnities made or given herein shall survive
the execution and delivery of this Agreement and the other Loan Documents and
the making and repayment of the Advances hereunder and such indemnities shall
survive termination hereof.
12.8 Failure or Indulgence Not Waiver; Remedies Cumulative. No failure
or delay on the part of Agent or any Lender in the exercise of any power, right
or privilege under any of the Loan Documents shall impair such power, right or
privilege or be construed to be a waiver of any default or
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acquiescence therein, nor shall any single or partial exercise of any such
power, right or privilege preclude other or further exercise thereof or of any
other right, power or privilege. All rights and remedies existing under the Loan
Documents are cumulative to and not exclusive of any rights or remedies
otherwise available.
12.9 Payments Set Aside. To the extent that Borrower makes a payment or
payments to Agent or the Lenders, or Agent or the Lenders exercise their rights
of setoff, and such payment or payments or the proceeds of such setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, state or federal law, common law or
equitable cause, then to the extent of such recovery, the Obligation or part
thereof originally intended to be satisfied, and all rights and remedies
therefor, shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred.
12.10 Severability. In case any provision in or obligation under this
Agreement or the other Loan Documents shall be invalid, illegal or unenforceable
in any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby, provided,
however, that if the rates of interest or any other amount payable hereunder, or
the collectibility thereof, are declared to be or become invalid, illegal or
unenforceable, Lenders' obligations to make Advances shall not be enforceable.
12.11 Headings. Section headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
12.12 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA.
12.13 Limitation of Liability. To the extent permitted by applicable
law, no claim may be made by Borrower, any Lender or any other Person against
Agent or any Lender, or the affiliates, directors, officers, employees,
attorneys or agents of any of them, for any special, indirect, consequential or
punitive damages in respect of any claim for breach of contract or any other
theory of liability arising out of or related to the transactions contemplated
by this Agreement, or any act, omission or event occurring in connection
therewith; and Borrower and each Lender hereby waive, release and agree not to
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xxx upon any claim for any such damages, whether or not accrued and whether or
not known or suspected to exist in its favor.
12.14 Successors and Assigns. This Agreement and the other Loan
Documents shall be binding upon the parties hereto and their respective
successors and assigns and shall inure to the benefit of the parties hereto and
the successors and permitted assigns of Agent and Lenders. The terms and
provisions of this Agreement shall inure to the benefit of any permitted
assignee or transferee of the Advances and the Pro Rata Shares of the Commitment
of the Lenders under this Agreement, and in the event of such transfer or
assignment, the rights and privileges herein conferred upon Agent and Lenders
shall automatically extend to and be vested in such transferee or assignee, all
subject to the terms and conditions hereof. Borrower's rights and interests
hereunder and under the other Loan Documents, and Borrower's duties and
Obligations hereunder and under the other Loan Documents, shall not be assigned
or otherwise transferred without the consent of all Lenders.
12.15 Consent to Jurisdiction and Service of Process; Waiver of Jury
Trial. ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST BORROWER WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE, AND ALL JUDICIAL PROCEEDINGS
BROUGHT BY BORROWER WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
SHALL BE, BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION HAVING
SITUS WITHIN THE BOUNDARIES OF THE FEDERAL COURT DISTRICT OF THE SOUTHERN
DISTRICT OF CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
BORROWER ACCEPTS, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY
AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS, AND IRREVOCABLY
AGREES TO BE BOUND BY ANY FINAL JUDGMENT RENDERED THEREBY FROM WHICH NO APPEAL
HAS BEEN TAKEN OR IS AVAILABLE. BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY
THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID,
TO ITS NOTICE ADDRESS SPECIFIED ON THE SIGNATURE PAGES HEREOF. BORROWER, AGENT
AND LENDERS IRREVOCABLY WAIVE (A) TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH
RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, AND (B) ANY OBJECTION
(INCLUDING WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON
THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE. NOTHING HEREIN SHALL
AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL
LIMIT THE RIGHT OF AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST BORROWER IN
THE COURTS OF ANY OTHER JURISDICTION.
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12.16 Counterparts; Effectiveness; Inconsistencies. This Agreement and
any amendments, waivers, consents or supplements hereto may be executed in
counterparts, each of which when so executed and delivered shall be deemed an
original, but all of which, taken together, shall constitute but one and the
same instrument. This Agreement shall become effective when (i) Borrower, the
initial Lenders and Agent have duly executed and delivered signature pages of
this Agreement to each other (delivery by Borrower to Lenders and by any Lender
to Borrower and any other Lender being deemed to have been made by delivery to
Agent) and (ii) Agent has received all fees due under its separate agreement
with Borrower. Agent shall send written confirmation of the Closing Date to
Borrower and each other Lender promptly following the occurrence thereof. This
Agreement and each of the other Loan Documents shall be construed to the extent
reasonable to be consistent one with the other, but to the extent that the terms
and conditions of this Agreement are actually and directly inconsistent with the
terms and conditions of any other Loan Document, this Agreement shall govern.
12.17 Performance of Obligations. Borrower agrees that Agent may, but
shall have no obligation to, make any payment or perform any act required of
Borrower under any Loan Document which Borrower has failed to make or do.
12.18 Construction. The parties to this Agreement acknowledge that each
party and its counsel have reviewed and revised this Agreement and that the
normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation
of this Agreement or any amendments or exhibits hereto.
12.19 Entire Agreement. This Agreement, taken together with all of the
other Loan Documents and all certificates and other documents delivered by
Borrower to Agent, embodies the entire agreement and supersede all prior
agreements, written and oral, relating to the subject matter hereof.
12.20 Assignments and Participations.
(a) After first obtaining the approval of Agent and Borrower
(other than upon the occurrence and during the continuance of any Event of
Default), which approval shall not be unreasonably withheld, each Lender may
assign to one or more banks or financial institutions, all or a portion of its
rights and obligations under this Agreement (including, without limitation, all
or a portion of its Pro Rata Share of the Commitment and the Advances owing to
it) and the other Loan Documents; provided, however, that (i) each such
assignment shall be of a constant, and not a varying, percentage of the
assigning Lender's rights and obligations under this Agreement
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and the other Loan Documents, and such percentage of the assigning Lender's
rights and obligations shall be the same percentage with respect to both such
Lender's Pro Rata Share of the Commitment and Advances, (ii) the aggregate
amount of the Pro Rata Share of the Commitment of the assigning Lender being
assigned pursuant to each such assignment (determined as of the date of the
Assignment and Assumption with respect to such assignment) shall in no event be
less than Ten Million Dollars ($10,000,000) and shall be an integral multiple of
One Million Dollars ($1,000,000), (iii) the parties to each such assignment
shall execute and deliver to Agent, for its approval and acceptance, an
Assignment and Assumption, and (iv) Agent shall receive from the assignor a
processing fee of Three Thousand Dollars ($3,000). Without restricting the right
of Borrower or Agent to reasonably object to any bank or financial institution
becoming an assignee of an interest of a Lender hereunder, each proposed
assignee must be an existing Lender or a bank or financial institution which (A)
has (or, in the case of a bank which is a subsidiary, such bank's parent has) a
rating of its senior unsecured debt obligations of not less than Baa-2 by
Xxxxx'x Investors Service, Inc. or a comparable rating by a rating agency
acceptable to Agent and (B) has total assets in excess of Ten Billion Dollars
($10,000,000,000); provided, however, that Agent and Borrower may waive the
requirements set forth in the foregoing clauses (A) and (B) with respect to any
proposed assignee so long as both Agent and Borrower agree to any such waiver.
Unless Agent or Borrower gives written notice to the assigning Lender that it
objects to the proposed assignment (together with a written explanation of the
reasons behind such objection) within ten (10) Business Days following receipt
of the assigning Lender's written request for approval of the proposed
assignment, Agent or Borrower, as the case may be, shall be deemed to have
approved such assignment. Upon such execution, delivery, approval and
acceptance, and upon the effective date specified in the applicable Assignment
and Assumption, (X) the assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment and Assumption, have the rights and obligations of a Lender
hereunder, and (Y) the assigning Lender thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to such
Assignment and Assumption, relinquish its rights and be released from its
obligations under this Agreement.
(b) By executing and delivering an Assignment and Assumption,
the assigning Lender thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Assumption, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made
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in or in connection with this Agreement or any other Loan Document or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement or any other Loan Document or any other instrument or document
furnished pursuant hereto; (ii) such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Borrower or the performance or observance by the Borrower of any of their
respective obligations under any Loan Document or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Article 4 or delivered pursuant to Article 5 to the
date of such assignment and such other Loan Documents and other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Assumption; (iv) such assignee will,
independently and without reliance upon Agent, such assigning Lender 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 in taking or
not taking action under this Agreement; (v) such assignee appoints and
authorizes 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
Agent by the terms hereof and thereof, together with such powers as are
reasonably incidental thereto; and (vi) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of this Agreement are required to be performed by it as a Lender.
(c) Agent shall maintain, at its address referred to on the
counterpart signature pages hereof, a copy of each Assignment and Assumption
delivered to and accepted by it and shall record in the Loan Account the names
and addresses of each Lender and the Pro Rata Share of the Commitment of, and
principal amount of the Advances owing to, such Lender from time to time.
Borrower, Agent and Lenders may treat each Person whose name is recorded in the
Loan Account as a Lender hereunder for all purposes of this Agreement.
(d) Upon its receipt of an Assignment and Assumption executed by
an assigning Lender and an assignee approved by Agent and Borrower as provided
in Section 12.20(a), Agent shall, if such Assignment and Assumption has been
properly completed and is in substantially the form of Exhibit A, (i) accept
such Assignment and Assumption, (ii) record the information contained therein in
the Loan Account, and (iii) give prompt notice thereof to Borrower. Upon
request, Borrower will execute and deliver to Agent an appropriate replacement
promissory note or replacement promissory notes in favor of each assignee (and
assignor, if such assignor is
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retaining a portion of its Pro Rata Share of the Commitment and Advances)
reflecting such assignee's (and assignor's) Pro Rata Share of the Commitment.
Upon execution and delivery of such replacement promissory note(s) the original
promissory note or notes evidencing all or a portion of the Pro Rata Share of
the Commitment and Advances being assigned shall be canceled and returned to
Borrower.
(e) Each Lender may sell participations to one or more banks or
other financial institutions in or to all or a portion of its rights and
obligations under this Agreement without the consent of any other party to this
Agreement (including, without limitation, all or a portion of its Pro Rata Share
of the Commitment and the Advances owing to it) and the other Loan Documents;
provided, however, that (i) such Lender's obligations under this Agreement
(including, without limitation, its obligation to fund its Pro Rata Share of the
Commitment to Borrower hereunder) shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, (iii) the participating banks or other financial institutions
shall not be a Lender hereunder for any purpose, (iv) Borrower, Agent and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
with regard to any and all payments to be made under this Agreement, (v) the
participation interest shall be expressed as a percentage of the granting
Lender's Pro Rata Share of the Commitment as it then exists and shall not
restrict an increase in the Commitment, or in the granting Lender's Pro Rata
Share of the Commitment, so long as the amount of the participation interest is
not affected thereby and (vi) the consent of the holder of such participation
interest shall not be required for amendments or waivers of provisions of the
Loan Documents and the holder of any such participation shall not be entitled to
voting rights under their participation agreement except for voting rights with
respect to (A) extensions of the Maturity Date; or (B) decreases in the interest
rates or fees described in this Agreement.
(f) Borrower will use reasonable efforts to cooperate with Agent
and Lenders in connection with the assignment of interests under this Agreement
or the sale of participations herein.
(g) Anything in this Agreement to the contrary notwithstanding,
and without the need to comply with any of the formal or procedural requirements
of this Agreement, including Section 12.20, any Lender may at any time and from
time to time pledge and assign all or any portion of its rights under all or any
of the Loan Documents to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender
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from its obligations thereunder. To facilitate any such pledge or assignment,
Agent shall, at the request of such Lender, enter into a letter agreement with
the Federal Reserve Bank in substantially the form of the exhibit to Appendix C
to the Federal Reserve Bank of New York Operating Circular No. 12.
(h) Anything in this Agreement to the contrary notwithstanding,
any Lender may assign all or any portion of its rights and obligations under
this Agreement to another branch or Affiliate of such Lender without first
obtaining the approval of Agent and Borrower, provided that (i) at the time of
such assignment such Lender is not a Defaulting Lender, (ii) such Lender gives
Agent and Borrower at least fifteen (15) days' prior written notice of any such
assignment, (iii) the parties to each such assignment execute and deliver to
Agent an Assignment and Assumption, and (iv) Agent receives from assignor a
processing fee of Three Thousand Dollars ($3,000).
(i) No assignee of any rights and obligations under this
Agreement shall be permitted to subassign such rights and obligations.
(j) No Lender shall be permitted to assign or sell all or any
portion of its rights and obligations under this Agreement to Borrower or any
Affiliate of Borrower.
(k) The dissemination or disclosure by any Lender to any
prospective assignee or participant of any confidential information obtained by
Agent or the Lenders pursuant to this Agreement or in connection with the
Advances is subject to the terms of Section 5.3.
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IN WITNESS WHEREOF, this Agreement has been duly executed as of
the date set forth above.
BORROWER: PRICE ENTERPRISES, INC.,
a Maryland corporation
By /s/ S. XXXX XXXXXXX
---------------------------------
S. Xxxx Xxxxxxx
Its Senior Vice President
and General Counsel
By /s/ XXXXX X. XXXXXXXX
---------------------------------
Xxxxx X. Xxxxxxxx
Its Chief Financial Officer
ADDRESS FOR NOTICE AND DELIVERY:
Price Enterprises, Inc.
00000 Xxxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
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AGENT: XXXXX FARGO BANK, NATIONAL
ASSOCIATION, as Agent
By /s/ XXXXXXX XXXX
---------------------------------
Xxxxxxx Xxxx
Its Senior Vice President
By /s/ XXXXX XXXXXXXXXX
---------------------------------
Xxxxx Xxxxxxxxxx
Its Vice President
ADDRESS FOR NOTICE AND DELIVERY:
Xxxxx Fargo Bank, N.A.
000 X Xxxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Manager
Tel: (000) 000-0000
Fax: (000) 000-0000
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LENDERS: XXXXX FARGO BANK, NATIONAL
ASSOCIATION, as a Lender
By /s/ XXXXXXX XXXX
---------------------------------
Xxxxxxx Xxxx
Its Senior Vice President
By /s/ XXXXX XXXXXXXXXX
---------------------------------
Xxxxx Xxxxxxxxxx
Its Vice President
ADDRESS FOR NOTICE AND DELIVERY:
Xxxxx Fargo Bank, N.A.
Real Estate Group
000 X Xxxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Manager
Tel: (000) 000-0000
Fax: (000) 000-0000
LIBOR OFFICE:
Real Estate Group Disbursement
Center
0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
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BANK ONE, NA
By /s/ DELL X. XXXXX
---------------------------------
Dell X. XxXxx
Its Vice President
ADDRESS FOR NOTICE AND DELIVERY:
Bank One, NA
1 Bank Xxx Xxxxx
00xx Xxxxx
Xxxxx XX0-0000
Xxxxxxx, XX 00000-0000
Attention: Xxxxxx Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
LIBOR OFFICE:
Bank One, NA
1 Bank Xxx Xxxxx
00xx Xxxxx
Xxxxx XX0-0000
Xxxxxxx, XX 00000-0000
Attention: Xxxxxx Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
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AMSOUTH BANK
By /s/ XXXXXX X. XXXXXXX
---------------------------------
Xxxxxx X. Xxxxxxx
Its Assistant Vice President
ADDRESS FOR NOTICE AND DELIVERY:
AmSouth Bank
Commercial Real Estate Lending
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
LIBOR OFFICE:
AmSouth Bank
Commercial Real Estate
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
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BANKBOSTON, N.A.
By /s/ XXXXXX X. XXXXXXXXXXXX
---------------------------------
Xxxxxx X. Xxxxxxxxxxxx
Its Vice President
ADDRESS FOR NOTICE AND DELIVERY:
BankBoston, N.A.
000 Xxxxxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
LIBOR OFFICE:
BankBoston, N.A.
000 Xxxxxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
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GUARANTOR'S CONSENT AND AMENDMENT
Price Enterprises - TX, Inc., a Delaware corporation
("Guarantor"), hereby (i) acknowledges, agrees and consents to all of the terms
and provisions of the foregoing First Amended and Restated Revolving Credit
Agreement, (ii) acknowledges and agrees that the Guaranty (the "Guaranty") and
the Security Agreement (the "Security Agreement"), both dated as of December 3,
1998, and, in the case of the Guaranty, executed by Guarantor in favor of Agent,
and, in the case of the Security Agreement, executed by Guarantor and Borrower
in favor of Agent, are and shall remain in full force and effect, and that none
of the terms of the First Amended and Restated Revolving Credit Agreement shall
be construed to impair, or provide a defense to, any of the obligations of
Guarantor under the Guaranty and/or the Security Agreement, (iii) acknowledges
and agrees that all of the obligations to Agent and the Lenders presently
guaranteed under the Guaranty and/or secured by the Security Agreement shall, as
supplemented, amended and otherwise modified by the First Amended and Restated
Revolving Credit Agreement, continue to be guaranteed and secured thereunder,
(iv) agrees that the reference to "FIFTY MILLION AND NO/100THS DOLLARS
($50,000,000.00)" in Recital A of the Guaranty is hereby deleted and replaced
with "ONE HUNDRED TWENTY-FIVE MILLION AND NO/100THS DOLLARS ($125,000,000.00)",
and that the reference to "FIFTY MILLION AND NO/100THS DOLLARS ($50,000,000.00)"
in Section 1 of the Guaranty is hereby deleted and replaced with "ONE HUNDRED
TWENTY-FIVE MILLION AND NO/100THS DOLLARS ($125,000,000.00)", and (v) agrees
that all references in the Guaranty and/or the Security Agreement to the "Credit
Agreement", the "Loan Agreement", the "Loan Documents" and to any Loan Document
shall mean the First Amended and Restated Revolving Credit Agreement, the Loan
Documents and
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such Loan Document, respectively, as modified and amended by the First Amended
and Restated Revolving Credit Agreement.
IN WITNESS WHEREOF, Guarantor has duly executed this Guarantor's
Consent and Amendment as of February 14, 2000
PRICE ENTERPRISES - TX, INC.,
a Delaware corporation
By /s/ XXXX XXXXX
---------------------------------
Its PRESIDENT
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By /s/ XXXX XXXX
---------------------------------
Its EXEC. VICE PRES.
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