EXHIBIT 10.9
AMENDED AND RESTATED MASTER CONSTRUCTION
AND TERM LOAN AGREEMENT
THIS AMENDED AND RESTATED MASTER CONSTRUCTION AND TERM LOAN AGREEMENT,
Made and entered into this 17th day of July, 2000, by and among FCA REAL ESTATE
HOLDINGS, LLC, a Delaware limited liability company ("Borrower"), U.S. BANK
NATIONAL ASSOCIATION, a national banking association, as agent and
administrative bank (in such capacity, the "Administrative Bank") for the
"Lenders" now or hereafter parties hereto (individually a "Lender" and
collectively the "Lenders", which term shall include the Administrative Bank in
its role as a Lender) and U.S. BANK NATIONAL ASSOCIATION, a national banking
association, as collateral agent (in such capacity, the "Collateral Agent").
WHEREAS, Borrower, the Administrative Bank, and Series Lenders for the
Series A through E Loans are the parties to that certain Master Construction and
Term Loan Agreement dated as of March 3, 1999, as supplemented by the Series A
Supplement dated as of March 3, 1999, the Series B Supplement dated as of April
16, 1999, the Series C Supplement dated as of May 19, 1999, the Series D
Supplement dated as of August 12, 1999, as amended by a First Amendment to
Series D Supplement dated as of December 16, 1999 and the Series E Supplement
dated as of December 16, 1999 (the Master Construction and Term Loan Agreement
as so supplemented being the "Original Master Agreement").
WHEREAS, the Borrower, the Administrative Bank and such Lenders desire
to amend and restate the Original Master Agreement to add Approved Projects.
WHEREAS, U.S. Bank National Association, acting in its capacity as the
holder of the Refinance Loan and the Xxxx Loan desires to respectively amend and
restate such loans as the Series F Loan and the Series G Loan hereunder and the
Administrative Bank and such Lenders are willing to allow such amendment and
restatement.
NOW THEREFORE, in consideration of the above premises and the mutual
covenants and agreements hereinafter set forth, the parties hereto agree to
amend and restate the Original Master Agreement in its entirety to read as
follows:
DEFINITIONS
For purposes of this Agreement, the following terms shall have the
following respective meanings (and such meanings shall be equally applicable to
both the singular and plural form of the terms defined, as the context may
require), unless the context hereof clearly requires otherwise:
Accessibility Regulations: Any federal, state or local law,
statute, code, ordinance, rule, regulation or requirement relating to
accessibility to facilities or properties for disabled and handicapped
persons, including, without limitation, the Americans with Disability
Act of 1991, as amended.
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Additional Project: With respect to any Applicable Series
Loan, the other Approved Projects not being financed by such Applicable
Series Loan unless another Approved Project is described as an
"Excluded Project" in the Supplement for such Applicable Series Loan.
Additional Project Collateral: With respect to any Approved
Project constituting an Additional Project, the "Project Collateral"
described in the Supplement relating to the Applicable Series Loan for
such Project.
Additional Project Collateral Documents: With respect to any
Approved Project constituting an Additional Project, the Mortgage, the
Assignment and the other Loan Documents granting a Lien on such
Additional Project in favor of the Collateral Agent and described in
the Supplement for the Series Loan providing financing for such
Additional Project.
Additional Project Collateral Documents Amendments: With
respect to any Series Loan, the "Additional Project Collateral
Documents Amendments" described in the Supplement relating to such
Series Loan.
Additional Project Lease: With respect to any Approved Project
constituting an Additional Project, the "Project Lease" described in
the Supplement relating to the Applicable Series Loan for such
Additional Project.
Additional Secured Obligations: With respect to any Project,
the "Additional Secured Obligations" described in the Supplement
relating to the Applicable Series Loan for such Project.
Administrative Bank: As defined in the preamble hereto.
Administrative Bank Fees: With respect to any Series Loan, the
"Administrative Bank Fees" described in the Administrative Bank Fee
Agreement for such Series Loan.
Administrative Bank Fee Agreement: With respect to any Series
Loan, the "Administrative Bank Fee Agreement" described in the
Supplement relating to such Series Loan.
Advance: With respect to any Series Loan, any portion of such
Series Loan advanced to or for the benefit of Borrower by the Lenders
for such Series Loan in accordance with this Agreement.
Adverse Event: The occurrence of any event that could
reasonably be expected to have a material adverse effect on: (a) the
business, operations, property, assets or condition (financial or
otherwise) of Borrower or the Lessee; or (b) the ability of: (i)
Borrower to perform its obligations under the Loan Documents, including
any amendments thereof and supplements thereto; or (ii) Lessee to
perform
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its obligations under any Project Lease, including any amendments
thereof and supplements thereto.
Affiliate: With respect to any party, any Person which
directly or indirectly controls, is controlled by, or is under common
control with such party and, in addition, in the case of Borrower, each
officer, director, shareholder, joint venturer and partner of Borrower.
A Person shall be deemed to control another Person if the controlling
Person owns 10% or more of any class of voting stock of the controlled
Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the controlled
Person, whether through ownership of stock, by contract or otherwise.
Aggregate Indemnification Percentage: If the Administrative
Bank, in its reasonable business judgment, has allocated its claim for
any indemnification described in Section VII.8. to more than one Series
Loan, then the Aggregate Indemnification Percentage for each of the
Primary Lenders for such Series Loans shall be the ratio (expressed as
a percentage) which the aggregate amount of such Primary Lenders'
Individual Commitments for such Series Loans bears to the aggregate
amount of the Commitments for such Series Loans.
Agreement: This Loan Agreement, including any amendments
hereof and supplements hereto, including the Supplements.
Amortization Amount: With respect to any Series Loan, the
amount required to fully amortize such Series Loan accruing interest at
its Fixed Rate over a hypothetical 240 consecutive month amortization
period.
Applicable Required Lenders: For any Series Loan, the Required
Lenders for such Series Loan.
Applicable Series Loan: With respect to any Project, the
Series Loan made, or to be made, to Borrower by the Primary Lenders for
such Series Loan in order to finance Borrower's acquisition and/or
construction of such Project.
Approved Projects: Borrower's sports and health club
facilities located, or to be located, in Bloomington, MN, Eagan, MN,
Woodbury, MN, Troy, MI, Novi, MI, Shelby Township, MI, Columbus, OH,
Indianapolis, IN, Centreville, VA, and up to six (6) additional
projects approved by the Administrative Bank which will be the Projects
to be respectively located in Schaumburg, IL, Warrenville, IL, Orland
Park, IL, Algonquin, IL, Rochester Hills, MI and Rockville, MD;
provided that the Administrative Bank, in its reasonable business
judgment, may substitute Projects in two (2) different locations for
any of the above-described six (6) additional Projects not then being
financed by a Series Loan and any other of the Borrower's sports and
health club facilities approved by the Lenders.
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Assignment: With respect to any Series Loan, the "Assignment"
described in the Supplement relating to such Series Loan.
Balance: As provided in Section III.2. hereof.
Base Rent: With respect to any Project, the sum of the
"minimum rent" plus "rebatable rent" required to be paid by the Lessee
under the Project Lease for such Project.
Board: The Board of Governors of the Federal Reserve System or
any successor thereto.
Borrower: As provided in the preamble hereto.
Business Day: With respect to any Series Loan, any day other
than a Saturday, a Sunday, or a legal holiday on which the Primary
Lenders for such Series Loan are not open for business.
Capitalized Lease: Any lease which, in accordance with GAAP,
is capitalized on the books of the lessee.
CD Rate: For any Series Loan's Fixed Rate Period, the rate of
interest determined by the Administrative Bank to be the average
(rounded upward, if necessary, to the nearest 1/100th of 1%) of the
rates quoted to Lender at approximately 8:00 a.m., Minneapolis time (or
as soon thereafter as practicable), on such Series Loan's Fixed Rate
Conversion Date by certificate of deposit dealers selected by the
Administrative Bank, in its sole discretion, for the purchase from the
Administrative Bank, at face value, of certificates of deposit issued
by the Administrative Bank in an amount equal to the outstanding
principal balance of such Series Loan existing on such Fixed Rate
Conversion Date and for a maturity comparable to such Series Loan's
Fixed Rate Period, or at the option of the Administrative Bank
determined for such amount and maturity based on published composite
quotations of certificate of deposit rates selected by the
Administrative Bank.
Change of Control: (a) With respect to LTF, the occurrence
after the date of this Agreement of any event where Xxxxxx Xxxxxx,
Norwest Equity Partners V and Norwest Equity Partners VI, acting
together with any other holder of LTF's common stock or preferred stock
necessary to elect a majority of the members of LTF's board of
directors in accordance with the voting rights established by the Stock
Purchase Agreement that are in effect on the date hereof, cease to
control the election of a majority of LTF's board of directors except
where all of Xxxxxx Xxxxxx, Norwest Equity Partners V and Norwest
Equity Partners VI mutually agree to change the voting rights
established by the Stock Purchase Agreements from those in effect on
the date hereof; (b) with respect to Borrower, the occurrence after the
date of this Agreement of any event where LTF ceases to own 100% of
Borrower's members
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interests (either financial rights or governance rights) or ceases to
control the election of a majority of Borrower's board of governors or
ceases to control Borrower's management policies; or (c) with respect
to any Substitute Lessee the occurrence after the date of this
Agreement of any event where LTF ceases to own 100% of the equity
interests in such Substitute Lessee or ceases to control the election
of a majority of Borrower's board of directors or board of governors or
ceases to control such Substitute Lessee's management policies.
Closing Date: With respect to any Series Loan, the "Closing
Date" described in the Supplement relating to such Series Loan.
Code: The Internal Revenue Code of 1986, as amended, or any
successor statute, together with regulations thereunder.
Collateral: With respect to any Series Loan, the Project
Collateral and any Additional Project Collateral for such Series Loan.
Collateral Agency Agreement: The Collateral Agency Agreement,
dated as of March 3, 1999, between the Administrative Bank and the
Collateral Agent, including any amendments thereof and supplements
thereto executed by the Administrative Bank and the Collateral Agent
and approved by the Super Majority Lenders; provided, however, that,
after the Effective Date, the Collateral Agency Agreement shall be
deemed to have been merged into this Agreement and shall be of no
further force and effect as a separate document.
Collateral Agent: U.S. Bank acting in its separate capacity as
the Collateral Agent.
Columbus Proceeds: The Proceeds arising or resulting from the
Project located in Columbus, OH.
Commitment: With respect to any Series Loan, the Commitment as
described in the Supplement relating to such Series Loan.
Commitment Fees: With respect to any Series Loan, the
Commitment Fees as described in the Commitment Letter described in the
Supplement relating to such Series Loan and approved by the
Administrative Bank.
Commitment Letter: With respect to any Series Loan, the
Commitment Letter as described in the Supplement relating to such
Series Loan.
Completion: With respect to any Project, such Project's
Improvements (including all tenant improvements) are completed in
accordance with the relevant Plans, and paid for in full, free of all
mechanics', labor, materialmen's and other similar lien claims; said
completion has been approved and certified by the relevant Project
Architect and, if required by the Administrative Bank, the Inspecting
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Architect; a certificate of substantial completion for such
Improvements has been signed by Borrower and relevant Project Architect
and General Contractor and delivered to the Administrative Bank, and no
punch list items remain to be completed; the Administrative Bank has
received acceptable evidence that all Governmental Requirements and all
private restrictions and covenants relating to such Project have been
complied with or satisfied and that unconditional certificates of
occupancy for all of such Improvements have been issued by all
appropriate governmental authorities; Borrower has obtained and
delivered to the Administrative Bank copies of all licenses and permits
needed to operate such Project; the Administrative Bank has received
photographs of the completed Improvements, an estoppel certificate (on
the Administrative Bank's form) from the Lessee, copies of all
warranties (or letter summaries) from suppliers covering materials,
equipment and appliances included within such Project, evidence that
all insurance required hereby is in full force and effect and three (3)
copies of an as-built survey of such Project which conforms with the
Administrative Bank's requirements; and no Event of Default exists
hereunder.
Completion Date: With respect to any Series Loan, the
`Completion Date' described in the Supplement relating to such Series
Loan; provided, however, that the Completion Date for any Series Loan
shall not be later than the end of the twelfth (12th) month from the
signing of the Supplement for such Series Loan except that the
Administrative Bank, in its reasonable business judgment, may extend
the Completion Date for any Series Loan to the end of the fifteenth
(15th) month from such signing date.
Consultants: With respect to any Series Loan, the third party
experts retained by the Administrative Bank to assist it in connection
with closing, advancing, disbursing or administering such Series Loan.
Contingency Line Item Amount: With respect to any Series Loan,
the amount of the "Contingency" line item set forth in the Sworn
Construction Cost Statement for such Series Loan less the amount
reallocated to other line items subsequent to the delivery of such
Sworn Construction Cost Statement.
Contingency Reserve: A funded reserve equal to $500,000.00 in
the aggregate for the Approved Projects; provided, however, that the
Contingency Reserve may be non-funded so long as Borrower's obligation
to fund the Contingency Reserve is supported by an irrevocable letter
of credit (the "Contingency Reserve LC") issued by a financial
institution in favor of the Collateral Agent in form satisfactory to
the Super Majority Lenders and the Administrative Bank in their sole
discretion.
Contingency Reserve Account Agreement: The Amended and
Restated Contingency Reserve Account Agreement, dated as of even date
herewith, among Borrower, the Administrative Bank and the Collateral
Agent, including any amendments thereof and supplements thereto
executed by Borrower, the
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Administrative Bank and the Collateral Agent and approved by the Super
Majority Lenders.
Conversion Date: With respect to any Series Loan, the
Conversion Date described in the Supplement relating to such Series
Loan; provided, however, that the Conversion Date for any Series Loan
shall not be: (a) earlier than the tenth day of the first month
following Completion for the Project being constructed with the
proceeds of such Series Loan ; or (b) later than the tenth day of the
first month following the scheduled Completion Date for such Series
Loan, after giving effect to any extension granted by the
Administrative Bank or the Super Majority Lenders) except that the
Administrative Bank in its reasonable business judgment, may extend the
Conversion Date for any Series Loan to the end of the fourth (4th)
month from such scheduled Completion Date.
Default: Any event which, with the giving of notice to
Borrower or lapse of time, or both, would constitute an Event of
Default.
Defaulting Lender: As defined in Section III.6.(b).
Default Rate: The Default Rate of interest payable under the
Notes, as that term is defined in the Notes.
Disbursing Agreement: With respect to any Series Loan, the
"Disbursing Agreement" described in the Supplement relating to such
Series Loan.
Domestic Reserve Percentage: As of any day, that percentage
which is in effect on such day, as prescribed by the Board for
determining the maximum reserve requirement (including any basic,
supplemental or emergency reserves) for a member bank of the Federal
Reserve System, with deposits comparable in amount to those held by the
Administrative Bank, in respect of new non-personal time deposits in
dollars having a maturity comparable to the Fixed Rate Period and in an
amount of $100,000 or more.
Draw Request: A written request by Borrower, on the
Administrative Bank's form, for an Advance of the proceeds of a Series
Loan under this Agreement and the Disbursing Agreement for such Series
Loan.
Effective Date: The date on which the Series F Loan, Series G
Loan and Series H Loan are made after the satisfaction of all
conditions precedent specified in Articles II and II.B.
Employee Benefit Plan: An employee benefit plan or other plan,
maintained for employees of the Borrower or of any ERISA Affiliate, and
subject to Title IV of ERISA or Section 412 of the Code.
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Environmental Audit: With respect to any Project, a written
environmental review, audit, assessment or report addressed to the
Administrative Bank, the Lenders and the Collateral Agent, setting
forth the results of an investigation of such Project, including an
historical investigation of the uses and ownership of such Project's
Land, contacts with appropriate governmental agencies and any Tests
which may be requested by the Primary Lenders for such Project, the
Administrative Bank or the Collateral Agent, prepared by a competent
environmental engineer or consultant who is acceptable to such Primary
Lenders, the Administrative Bank and the Collateral Agent and is
licensed, bonded and insured in accordance with all applicable
statutes.
Equipment: With respect to any Project, the fixtures,
equipment and personal property owned or leased by Borrower and located
or to be located in or on, and used in connection with the management,
maintenance or operation of, such Project's Land and Improvements, but
in no event including any of the Lessee's now existing or hereafter
acquired items of machinery, equipment, furnishings, fixtures and other
personal property that constitute Lessee's trade equipment or fixtures
used in the conduct of its business operations at such Project, or that
are subject to any agreement restricting Borrower's right to grant a
security interest therein to the Collateral Agent.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended, or any successor statute, together with regulations
thereunder.
ERISA Affiliate: Any trade or business (whether or not
incorporated) that is a member of a group of which Borrower is a member
and which is treated as a single employer under Section 414 of the
Code.
Event of Default: An Event of Default specified in Section
VI.1. hereof.
Fixed Rate: A per annum rate equal to the sum of: (a) two and
one-half percent (2.5%); plus (b) the Reserve Adjusted Certificate of
Deposit Rate.
Fixed Rate Conversion Date: The Conversion Date.
Fixed Rate Period: With respect to any Series Loan, the five
(5) year period commencing on and including such Series Loan's Fixed
Rate Conversion Date.
General Contractor: With respect to any Series Loan, the
"General Contractor" described in the Supplement relating to such
Series Loan.
GAAP: Generally accepted accounting principles as in effect
from time to time including, without limitation, applicable statements,
bulletins and interpretations of the Financial Accounting Standards
Board and applicable bulletins, opinions and interpretations issued by
the American Institute of Certified Public Accountants or its
committees.
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Governmental Requirements: With respect to any Project, the
laws, statutes, codes, ordinances, and governmental rules, regulations
and requirements applicable to Borrower, the Administrative Bank, the
Primary Lenders for the such Project, the Collateral Agent and/or such
Project including, without limitation, the requirements of the
Americans with Disabilities Act of 1990, as amended, and all
regulations thereunder.
Improvements: With respect to any Series Loan, the
"Improvements" described in the Supplement relating to such Series
Loan.
Indebtedness: Without duplication, all obligations, contingent
or otherwise, which in accordance with GAAP should be classified upon
the Borrower's balance sheet as liabilities, but in any event including
the following (whether or not they should be classified as liabilities
upon such balance sheet): (a) obligations secured by any mortgage,
pledge, security interest, lien, charge or other encumbrance existing
on property owned or acquired subject thereto, whether or not the
obligation secured thereby shall have been assumed and whether or not
the obligation secured is the obligation of the owner or another party;
(b) any obligation on account of deposits or advances; (c) any
obligation for the deferred purchase price of any property or services,
except trade accounts payable; (d) any obligation as lessee under any
Capitalized Lease; (e) all guaranties, endorsements and other
contingent obligations in respect to Indebtedness of others; and (f)
undertakings or agreements to reimburse or indemnify issuers of letters
of credit. For all purposes of this Agreement, the Indebtedness of any
Person shall include the Indebtedness of any partnership or joint
venture in which such Person is a general partner or a joint venturer
unless such Indebtedness is non-recourse to such Person.
Indemnification Percentage: With respect to any
indemnification described in Section VII.8. which the Administrative
Bank, in its reasonable business judgment, allocates to: (a) a single
Series Loan, then the Indemnification Percentage for each Primary
Lender for such Series Loan shall be its Percentage for such Series
Loan; (b) more than one Series Loan, then the Indemnification
Percentage for each Primary Lender for such Series Loans shall be its
Aggregate Indemnification Percentage for such Series Loans.
Indemnity: With respect to any Series Loan, the "Indemnity"
described in the Supplement relating to such Series Loan.
Individual Commitment: With respect to any Primary Lender for
a Series Loan, such Primary Lender's "Individual Commitment" described
in the Supplement for such Series Loan.
Inspecting Architect: For any Project, KKE Architects, Inc.,
and/or any other independent architect, engineer or Consultant selected
by the Administrative Bank and approved by the Primary Lenders for such
Project.
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Interest Rate: The Variable Rate during the Variable Rate
Period or the Fixed Rate during the Fixed Rate Period.
Investment: The acquisition, purchase, making or holding of
any stock or other security, any loan, advance, contribution to
capital, extension of credit (except for trade and customer accounts
receivable for inventory sold or services rendered in the ordinary
course of business and payable in accordance with customary trade
terms), any acquisitions of real or personal property (other than real
and personal property acquired in the ordinary course of business) and
any purchase or commitment or option to purchase stock or other debt or
equity securities of, or any interest in, another Person or any
integral part of any business or the assets comprising such business or
part thereof.
Land: With respect to any Series Loan, the "Land" described in
the Supplement relating to such Series Loan.
Lease Subordination Agreement: With respect to any Series
Loan, the "Lease Subordination Agreement" described in the Supplement
relating to such Series Loan.
Lessee: For any Project, the Original Lessee and any
Substitute Lessee for such Project.
Lender: As defined in the preamble hereto.
Lien: Any security interest, mortgage, pledge, lien,
hypothecation, judgment lien or similar legal process, charge,
encumbrance, title retention agreement or analogous instrument or
device (including, without limitation, the interest of the lessors
under Capitalized Leases and the interest of a vendor under any
conditional sale or other title retention agreement).
Loan: The Series Loans.
Loan Documents: The documents described in Section II.2. of
this Agreement which evidence and secure a Series Loan, including but
not limited to the Notes, the Mortgage, this Agreement, the Assignment,
the Indemnity, the Lease Subordination Agreement, the Additional
Project Collateral Documents and the Disbursing Agreement for such
Series Loan, any loan document described in Section II.9 of the
Supplement for such Series Loan and including any amendments thereof
and supplements thereto executed by the respective parties thereto and
approved by the parties required by this Agreement.
Loan Fee: As defined in Section II.6.
Loan Year: With respect to any Series Loan, the 12 month
period commencing on such Series Loan's Conversion Date, (or the
anniversary date of such Conversion
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Date in any subsequent year) and ending on the day preceding the
immediately following anniversary date of such Conversion Date.
LTF: LIFE TIME FITNESS, Inc., a Minnesota corporation f/k/a
FCA, Ltd.
Maturity Date: With respect to any Series Loan, the "Maturity
Date" described in the Supplement relating to such Series Loan;
provided, however, that the Maturity Date for any Series Loan shall not
be: (a) earlier than the last day of the sixtieth (60th) month
following the Conversion Date for the Project being constructed with
the proceeds of such Series Loan ; or (b) later than the last day of
the seventy-second (72nd) month from the signing of the Supplement for
such Series Loan.
Maximum Loan Amount: For any Project, the lesser of: (a) 75%
of the fair market value of such Project as a vacant health club upon
its Completion ; or (b) (i) 50% of the costs for the Projects being
respectively financed by the Series A through D Loans and the Series F
and G Loans set forth in the Sworn Construction Cost Statement for the
Applicable Series Loan for such Project; or (ii) 60% of such costs each
other Project being financed by the other Applicable Series Loan.
Mortgage: With respect to any Series Loan, the "Mortgage"
described in the Supplement relating to such Series Loan.
Non-Usage Fee: As defined in Section I.5. hereof.
Note or Notes: With respect to any Series Loan, the Promissory
Notes executed and delivered by Borrower to the respective order of the
Primary Lenders for such Series Loan, to evidence such Primary Lender's
Percentage of such Series Loan, including any amendments thereof and
supplements thereto executed by Borrower and such Lender.
Obligations: With respect to any Project: (a) the indebtedness
evidenced by the Notes for such Project's Applicable Series Loan and
all other advances, debts, liabilities, obligations, covenants and
duties owing by Borrower of any kind or nature, present or future,
which arise under this Agreement and the Supplement for such Series
Loan or any other Loan Document for such Series Loan, whether or not
evidenced by any note, guaranty or other instrument, whether or not for
the payment of money, whether joint, several, or joint and several,
direct or indirect (including those acquired by assignment or
purchase), absolute or contingent, due or to become due, and however
acquired (collectively, the "Project Obligations"); and (b) the
Additional Secured Obligations described for such Project. The term
includes, but is not limited to, all interest, fees, charges, expenses,
attorneys' fees, and any other sum chargeable to Borrower under this
Agreement and the Supplement for such Series Loan or any other Loan
Document for such Series Loan.
Operating Budget: With respect to any Project, a detailed
listing of all anticipated annual income and expenses from and for
managing, maintaining and
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operating such Project for its first full or partial fiscal year and
for each succeeding fiscal year of operation, prepared by Lessee or its
agent and in form and substance acceptable to the Administrative Bank
and the Primary Lenders for such Project.
Operating Lease: Any lease of personal property other than a
Capitalized Lease.
Operating Lease Expense: Rent and other payments made by
Borrower pursuant to any lease of (or other agreements conveying the
right to use) real and/or personal property other than a Capitalized
Lease.
Original Lessee: LTF.
Original Master Agreement: As defined in the preamble.
PBGC: The Pension Benefit Guaranty Corporation, established
pursuant to Subtitle A of Title IV of ERISA, and any successor thereto
or to the functions thereof.
Percentage: With respect to any Primary Lender for its Series
Loan, such Primary Lender's "Percentage" as defined in the Supplement
for such Series Loan.
Permitted Distributions: The Tax Distributions permitted by
Section V.29.
Permitted Encumbrances: With respect to any Series Loan, the
"Permitted Encumbrances" described in the Supplement relating to such
Series Loan.
Person: Any natural person, corporation, partnership, joint
venture, firm, association, trust, unincorporated organization,
government or governmental agency or political subdivision, or any
other entity, whether acting in an individual, fiduciary or other
capacity.
Plans: With respect to any Project, the final working plans
for such Project's Improvements, including drawings, specifications,
details and manuals, as approved by Primary Lenders for such Project
and the Administrative Bank.
Pollutant: Any hazardous or toxic substance, waste or
material, or other pollutant or contaminant (including but not limited
to radioactive materials, gasoline, asbestos, urea-formaldehyde and
polychlorinated biphenyls), as those terms are defined or used in any
Governmental Requirements.
Prepayment Percentage: With respect to any prepayment of any
Series Loan, the Refinance Loan or the Xxxx Loan, as the case may be,
the ratio (expressed as a percentage) which the amount of such
prepayment bears to the outstanding principal balance of such Series
Loan, the Refinance Loan or the Xxxx Loan, as the case may be,
immediately prior to the making of such prepayment.
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Primary Lenders: With respect to any Project, the "Lenders"
who are parties to the Supplement for the Applicable Series Loan for
such Project.
Principal Amount: With respect to each Lender, the sum of the
unpaid principal amount of all outstanding Series Loans hereby owed to
such Lender; provided, however, that if the "Principal Amount"
applicable to all Lenders as calculated above is $0, the "Principal
Amount" shall instead mean, with respect to each Lender, the amount of
all other indebtedness secured hereby then owed to such Lender.
Project: With respect to any Approved Project, the Land, the
Improvements and the Equipment for such Approved Project.
Project Architect: With respect to any Project, the "Project
Architect" described in the Supplement relating to the Applicable
Series Loan for such Project.
Project Collateral: With respect to any Series Loan, the
"Project Collateral" described in the Supplement relating to such
Series Loan.
Project Lease: With respect to any Series Loan, the "Project
Lease" described in the Supplement relating to such Series Loan.
Pro Rata Share: When calculating a Lender's portion of any
distribution or amount, that amount (expressed as a percentage) equal
to a fraction, the numerator of which is the then Principal Amount for
such Lender (immediately before such distribution) and the denominator
of which is the then aggregate Principal Amount for all Lenders.
Rebatable Rent: For any of Borrower's calendar years with
respect to any Project, the difference between: (a) the rebatable rent
described in the Project Lease for such Project; minus, (b) all other
operating expenses paid by the Borrower during such calendar year with
respect to such Project; minus (c) the Tax Distributions allocated to
such Project calculated on the basis that such Project was a separate
pass-through tax entity for such calendar year.
Reference Rate: The rate of interest publicly announced by the
Administrative Bank from time to time as its reference rate,
notwithstanding the fact that the Administrative Bank may lend funds to
its customers at rates that are at, above or below said reference rate.
Refinance Loan: At any time: (a) prior to the Effective Date,
the loan made to Borrower by US Bank pursuant to that certain Loan
Agreement dated July 31, 1997 (as amended, modified or supplement from
time to time being the "Refinance Loan Agreement") refinancing the
Borrower's Indebtedness with respect to Borrower's sports and health
club facilities respectively located in Bloomington, MN, Xxxxx, MN and
Woodbury, MN (each a "Refinance Project" and collectively the
"Refinance
13
Projects" at any time prior to the Effective Date or, on and after the
Effective Date, a Project); or (b) on and after the Effective Date,
such loan as amended and restated by the Series F Loan.
Refinance Mortgage: At any time: (a) prior to the Effective
Date, the "Mortgage" described in the Refinance Loan Agreement; or (b)
on and after the Effective Date, such "Mortgage" as amended and
restated by the Mortgage for the Series F Loan.
Regulation D: Regulation D (or any substitute regulations) of
the Board, together with all amendments from time to time thereto.
Regulation U: Regulation U (or any substitute regulations) of
the Board, together with all amendments from time to time thereto.
Regulatory Change: As to the Administrative Bank or any
Primary Lender, any change, after the date of this Agreement, in United
States federal, state or foreign laws, regulations or treaties, or the
adoption or making after such date of any interpretations, directives
or requests applying to the Administrative Bank or such Primary Lender
of or under any United States federal, state or foreign laws or
regulations (whether or not having the force of law) by any court or
governmental or monetary authority charged with the interpretation or
administration thereof.
Related Party: Any Person: (a) which directly or indirectly,
through one or more intermediaries, controls, or is controlled by, or
is under common control with, the described Person; (b) which
beneficially owns or holds 5% or more of the equity interest of the
described Person; or (c) 5% or more of the equity interest of which is
beneficially owned or held by the described Person or a subsidiary
thereof. The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of
voting securities or by contract.
Reportable Event: A reportable event, as defined in Section
4043 of ERISA and the regulations issued under such section, with
respect to an Employee Benefit Plan, excluding, however, such events as
to which the PBGC, by regulation, has waived the requirement of Section
4043(a) of ERISA that it be notified within 30 days of the occurrence
of such event, provided that a failure to meet the minimum funding
standard of Section 412 of the Code and Section 302 of ERISA shall be a
Reportable Event regardless of the issuance of any such waivers in
accordance with Section 412(d) of the Code.
Required Lenders: With respect to any Series Loan, the
"Required Lenders" described in the Supplement relating to such Series
Loan.
14
Required Secured Parties: With respect to any Series Loan, the
"Super Majority Lenders", notwithstanding that the Supplement relating
to such Series Loan may have a different definition.
Reserve Adjusted Certificate of Deposit Rate: With respect to
any Series Loan, the rate per annum equal to the sum (rounded upward,
if necessary, to the next one hundredth of one percent) of (a) the rate
per annum obtained by dividing (i) such Series Loan's CD Rate for its
Fixed Rate Period, by (ii) 1.00 minus the Domestic Reserve Percentage,
plus (b) the annual rate most recently estimated by the Administrative
Bank as the then current net annual assessment rate payable by the
Administrative Bank to the Federal Deposit Insurance Corporation (or
any successor) for insuring time deposits made in dollars at the
Administrative Bank's domestic offices, plus (c) the cost (converted to
an equivalent rate per annum) of the customary brokerage fee incurred
by the Administrative Bank in obtaining funds by the sale of its
negotiable certificates of deposit.
Series Loan: The separate loans to be made under this
Agreement in accordance with the applicable Supplement for such loans.
In order to distinguish one Series Loan from another, the Series Loans
may sometimes be respectively alphabetically denominated as the "Series
A Loan," the "Series B Loan," and so on in accordance with the
applicable Supplement for such Series Loan.
Stock Purchase Agreement: With respect to: (a) Norwest Equity
Partners V, the Stock Purchase Agreement dated May 7, 1996 among LTF
and the "Purchasers" party thereto; and (b) Norwest Equity Partners V
and Norwest Equity Partners VI, the Stock Purchase Agreement dated
December 8, 1998 among LTF and the "Purchasers" party thereto.
Subsidiary: Any Person of which or in which Borrower and its
other Subsidiaries own directly or indirectly 50% or more of: (a) the
combined voting power of all classes of stock having general voting
power under ordinary circumstances to elect a majority of the board of
directors of such Person, if it is a corporation, (b) the capital
interest or profit interest of such Person, if it is a partnership,
joint venture or similar entity, or (c) the beneficial interest of such
Person, if it is a trust, association or other unincorporated
organization.
Substitute Lessee: Any wholly-owned Subsidiary of LTF which
has been approved by the Super Majority Lenders, the Administrative
Bank and the Collateral Agent as a substitute lessee for a Project.
Super Majority Lenders: At any time, those Lenders (which term
shall include the US Bank) at such time having Individual Commitments
aggregating more than 66 2/3% of the aggregate Commitment for all
Series Loans.
15
Supplement: With respect to any Series Loan, a supplement to
this Agreement complying with Section VII.17. hereof executed by
Borrower, the Administrative Bank and the Primary Lenders for such
Series Loan.
Sworn Construction Cost Statement: With respect to any Series
Loan, the "Sworn Construction Cost Statement" described in the
Supplement relating to such Series Loan.
Sworn Statement: With respect to any Series Loan, the "Sworn
Statement" described in the Supplement relating to such Series Loan.
Tax Distributions: As defined in Section V.29.
Tests: With respect to any Project, such soil tests, chemical
tests, material tests and other tests and analyses as are appropriately
required to confirm, with relative certainty, the absence of Pollutants
from such Project.
Title Company: With respect to any Series Loan, the "Title
Company" described in the Supplement relating to such Series Loan.
Title Policy: With respect to any Series Loan, the loan policy
of title insurance in favor of the Collateral Agent issued by such
Series Loan's Title Company in form and substance satisfactory to such
Series Loan's Primary Lenders, the Administrative Bank and the
Collateral Agent.
Trigger Date: The date on which the payment of the Obligations
is accelerated or otherwise becomes due and payable prior to its stated
maturity as a result of an Event of Default.
Xxxx Loan: At any time: (a) prior to the Effective Date, the
loan made to Borrower by US Bank pursuant to that certain Construction
and Term Loan Agreement dated as of May 7, 1998 (as amended, modified
or supplement from time to time being the "Xxxx Loan Agreement")
financing the Borrower's acquisition and construction of its sports and
health club facilities located in Troy, Michigan (the "Xxxx Project" at
any time prior to the Effective Date or, on and after the Effective
Date, a Project); or (b) on and after the Effective Date, such loan as
amended and restated by the Series G Loan.
Xxxx Mortgage: At any time: (a) prior to the Effective Date,
the "Mortgage" described in the Xxxx Loan Agreement; or (b) on and
after the Effective Date, such "Mortgage as amended and restated by the
Mortgage for the Series G Loan.
Xxxx Parity Agreement: The Parity Agreement, dated as of March
3, 1999, among Borrower, US Bank and the Collateral Agent, including
any amendments thereof and supplements thereto executed by Borrower, US
Bank and the Collateral Agent and approved by the Super Majority
Lenders and the Administrative Bank
16
provided, however, that, after the Effective Date, the Xxxx Parity
Agreement shall be deemed to have been merged into this Agreement and
shall be of no further force and effect as a separate document.
US Bank: U.S. Bank National Association, acting its separate
capacity as the holder of the Refinance Loan and/or the Xxxx Loan at
any time prior to the Effective Date and as the holder of the Series F
Loan and the Series G Loan at any time on and after the Effective Date.
Variable Rate: A per annum rate equal to the sum of: (a)
one-half of one percent (0.50%); plus (b) the Reference Rate, as the
same may fluctuate from time to time, as more fully described in the
Notes.
Variable Rate Period: With respect to any Series Loan, the
period commencing on (and including) the date on which such Series
Loan's Primary Lenders make their initial Advance of Loan proceeds to
the Borrower pursuant to this Agreement and the Disbursing Agreement
and ending on (but excluding) such Series Loan's Fixed Rate Conversion
Date.
Other capitalized terms defined herein shall have the meanings ascribed
to them herein. Any capitalized terms defined in a Supplement for a Series Loan
shall have the meaning ascribed to them in such Supplement and shall only apply
to such Series Loan.
I. LOAN
The provisions of this ARTICLE I shall separately apply to each Series
Loan and its Primary Lenders. Each defined term used in this ARTICLE I shall
have the meaning provided in this Agreement as supplemented by the Supplement
for such Series Loan.
I.1. Principal.
Subject to the terms and conditions hereof, the Primary Lenders for a
Series Loan severally agree to lend to Borrower and Borrower agrees to borrow
from Lenders, the proceeds of such Series Loan, from time to time in accordance
with the terms hereof until the Maturity Date of such Series Loan, for the
purpose of developing the relevant Project; provided, however, that no such
Primary Lender shall be obligated to make any Advance if, after giving effect to
such Advance, the aggregate amount of Advances made by such Primary Lender would
exceed its Individual Commitment at such time or such Series Loan would exceed
the lesser of the Commitment or the Maximum Loan Amount. Each borrowing under
this Agreement shall consist of Advances made on the same day ratably by each
such Primary Lender in accordance with its Percentage. Notwithstanding the
expressed principal amount of the Notes, Borrower shall not be obligated to
repay more than the unpaid balance of Advances made to or for the benefit of
Borrower by such Primary Lenders pursuant hereto and to the other Loan
Documents, together with interest thereon at the rates specified below and in
the Notes, computed on each Advance from the date it is made by such Primary
Lenders. In no event shall the Primary Lenders be obligated hereunder to lend
17
to Borrower more than Borrower has qualified to receive under the terms
of ARTICLE III, hereof.
All Advances made by such Primary Lender shall be evidenced by a Note
in the amount of such Primary Lender's Individual Commitment. Each Note shall
mature and be payable at its Maturity Date and shall require that the
outstanding principal amount of the Series Loan evidenced thereby be amortized
in consecutive monthly installments equal to the Amortization Amount for such
Note, with the first such installment due and payable on the 10th day of the
first month following the Conversion Date. Each Primary Lender shall enter in
its records the amount of each of its Advances, the rate of interest borne on
such Advances and the payments of the principal balance received by such Primary
Lender, and such records shall be conclusive evidence of the subject matter
thereof, absent manifest error.
I.2. Interest.
Borrower shall pay to each Primary Lender for a Series Loan interest
computed at the applicable Interest Rate. Changes in the Variable Rate due to a
change in the Reference Rate shall become effective on the same day as the
change in the Reference Rate and shall apply to all Advances made hereunder
accruing interest at the Variable Rate, whether such Advances are made prior to,
the same day as, or subsequent to any particular change in the Reference Rate.
Such interest shall be payable, as accrued, on the first Business Day of each
calendar month, commencing on the first Business Day of the next calendar month
following the calendar month in which the initial Advance is made hereunder for
such Series Loan, and all unpaid, accrued interest shall be paid in full at the
time all Advances are paid in full. Interest shall be computed on the basis of a
360-day year, but shall be charged for the actual number of days principal is
unpaid. If such Series Loan has not been repaid on or before the Maturity Date,
then the entire unpaid balance of such Series Loan (without notice to or demand
upon Borrower) shall become due and payable on said date, together with all
unpaid, accrued interest thereon, and with interest computed from and after that
date in accordance with the terms of this Agreement and the Notes, until such
Series Loan is paid in full. The Notes provide for interest at the Default Rate
after maturity or an Event of Default and for a late payment charge.
In the event that the interest and/or charges in the nature of
interest, if any, provided for by this Agreement or by any other Loan Document,
shall contravene a legal or statutory limitation applicable to such Series Loan,
if any, Borrower shall pay only such amounts as would legally be permitted;
provided, however, that if the defense of usury and all similar defenses are
unavailable to Borrower, Borrower shall pay all amounts provided for herein. If,
for any reason, amounts in excess of the amounts permitted in the foregoing
sentence shall have been paid, received, collected or applied hereunder, whether
by reason of acceleration or otherwise, then, and in that event, any such excess
amounts shall be applied to principal, unless principal has been fully paid, in
which event such excess amount shall be refunded to Borrower.
18
I.3. Prepayment.
In consideration of Borrower's agreement to pay the prepayment
indemnity required by Section I.8 and the prepayment fee required by this
Section, Borrower may prepay the Notes for any Series Loan, in whole or in part,
at any time without premium or penalty except that each prepayment shall be
accompanied by: (a) a prepayment fee equal to: (i) 1.25% of the amount prepaid
if such prepayment occurs prior to the Conversion Date or in the first Loan Year
for such Series Loan; (ii) 1.00% of the amount prepaid if such prepayment occurs
in the second Loan Year for such Series Loan; (iii) 0.75% of the amount prepaid
if such prepayment occurs in the third Loan Year for such Series Loan; (iv)
0.50% of the amount prepaid if such prepayment occurs in the fourth Loan Year
for such Series Loan; or (v) 0.25% of the amount prepaid if such prepayment
occurs in the fifth Loan Year for such Series Loan; provided, however, that no
prepayment fee under this subsection (a) shall be required with respect to any
prepayment made by the Borrower from the proceeds of a capital contribution made
to the Borrower by LTF immediately following LTF's receipt of proceeds from an
initial public offering of equity securities by LTF; (b) each prepayment shall
be accompanied by the amount, if any, required by Section I.8.; and (c) no
prepayment may be made on any Series Loan unless Borrower contemporaneously
prepays the outstanding principal balance of each other Series Loan, the
Refinance Loan and the Xxxx Loan by the same Prepayment Percentage. Borrower
shall give the Administrative Bank at least three (3) Business Days' prior
written notice of the date of any prepayment and the Administrative Bank shall
give prompt notice to the Primary Lenders for such Series Loan of any notice
received by the Administrative Bank pursuant to this Section I.3. Any prepayment
must be accompanied by accrued and unpaid interest on the amount prepaid. Each
partial prepayment on any Series Loan shall be in the amount of $10,000.00 or an
integral multiple thereof and shall be applied against installments due on the
Notes for such Series Loan in the inverse order of their maturities. Amounts
paid or prepaid under this Section I.3. may not be reborrowed.
I.4. Fixed Rate.
If, at any time after the date specified in the Supplement for any
Series Loan, Borrower desires to obtain a quote from the Administrative Bank as
to locking the Fixed Rate for such Series Loan that will become applicable on
its Fixed Rate Conversion Date, then Borrower may deliver a written request for
such quote to the Administrative Bank by no later than 10:00 a.m. on the
Business Day on which Borrower desires to lock such Fixed Rate. Upon its receipt
of such request, the Administrative Bank, at its sole discretion, may quote (or
refuse to quote) a Fixed Rate to become applicable on such Fixed Rate Conversion
Date and the fees payable in connection with locking the rate. The
Administrative Bank shall promptly notify the Primary Lenders for such Series
Loan of any quoted fixed rate. If Borrower and the Administrative Bank agree to
any quoted fixed rate, then such quoted fixed rate shall be the applicable Fixed
Rate on the Fixed Rate Conversion Date.
19
If any Regulatory Change:
(a) shall subject any Primary Lender for a Series Loan to
any tax, duty or other charge with respect to such Series Loan or its
Note or shall change the basis of taxation of payment to such Primary
Lender of principal, interest or any other amounts due under this
Agreement, such Note or any other Loan Document (except for changes in
the rate of tax on the overall net income of such Primary Lender
imposed by the jurisdiction in which such Primary Lender's principal
office is located); or
(b) shall impose, modify or deem applicable any reserve,
special deposit, capital requirement or similar requirement (including,
without limitation, any such requirement imposed by the Board, but
excluding any such requirement to the extent included in calculating
the applicable Interest Rate for such Series Loan) against assets of,
deposits with or for the account of, or credit extended by, such
Primary Lender or shall impose on such Primary Lender or on the United
States market for certificates of deposit any other condition affecting
such Series Loan or its Note;
and the result of any of the foregoing is to increase the cost to such Primary
Lender of making or maintaining its Percentage of such Series Loan, or to reduce
the amount of any sum received or receivable by such Primary Lender under this
Agreement, its Note or any other Loan Document, then, within thirty (30) days
after demand by such Primary Lender, Borrower shall pay to such Primary Lender
such additional amount or amounts as will compensate such Primary Lender for
such increased cost or reduction. Any Primary Lender claiming compensation under
this Section I.4. will promptly notify Borrower and the Administrative Bank of
any event of which it has knowledge, occurring after the date hereof, which will
entitle such Primary Lender to compensation pursuant to this Section. A
certificate of such Primary Lender claiming compensation under this Section,
setting forth the additional amount or amounts to be paid to it hereunder and
stating in reasonable detail the basis for the charge and the method of
computation, shall be conclusive in the absence of error. In determining such
amount, the claiming Primary Lender may use any reasonable averaging and
attribution methods. Failure on the part of any Primary Lender to demand
compensation for any increased costs or reduction in amounts received or
receivable with respect to any period shall not constitute a waiver of such
Primary Lender's rights to demand compensation for any increased costs or
reduction in amounts received or receivable in any subsequent period.
If, on the Conversion Date for any Series Loan, the outstanding
principal balance of such Series Loan is less than the amount on which the Fixed
Rate has been established pursuant to Section I.4., Borrower shall compensate
each Primary Lender for such Series Loan, upon its written request, for all
losses, expenses and liabilities (including any interest paid by such Primary
Lender to lenders of funds borrowed by it to make or carry its Percentage of
such Series Loan to the extent not recovered by such Primary Lender in
connection with the re-employment of such funds and including loss of
anticipated profits) which such Primary Lender may sustain as a result of such
deficiency. Any Primary
20
Lender's request for compensation shall set forth the basis for the amount
requested and shall be final, conclusive and binding, absent error.
I.5. Capital Adequacy.
Borrower shall also pay to each Primary Lender from time to time on
demand such amounts as such Primary Lender may determine to be necessary to
compensate such Primary Lender for any costs which such Primary Lender
determines are attributable to its obligation to extend credit hereunder in
respect of any amount of capital maintained by such Primary Lender or any of its
affiliates pursuant to any law, guideline or regulation of any jurisdiction or
any interpretation, directive or request (whether or not having the force of
law) of any court or governmental or monetary authority, whether proposed on the
date of this Agreement or enacted, promulgated or issued thereafter. Without
limiting the foregoing, such compensation shall include an amount equal to any
reduction in return on assets or return on equity to a level below that which
such Primary Lender could have achieved absent its obligation to extend credit
hereunder and but for such law, regulation, interpretation, directive or
request. Any Primary Lender claiming compensation under this Section I.5. will
notify Borrower and the Administrative Bank as promptly as practicable after it
determines to demand such compensation.
I.6. Non-Usage Fee.
In addition, to the interest and other consideration to Lenders herein,
Borrower agrees to pay to the Administrative Bank for the ratable benefit of
each Primary Lender for any Series Loan a non-usage (the "Non-Usage Fee") on the
average daily non-disbursed portion of such Series Loan, during the most
recently ended month (including, without limitation, any portion thereof when
such Primary Lenders' obligations to lend shall be suspended by reason of
Borrower's inability to fulfill the applicable conditions set forth herein or in
the Disbursing Agreement for an advance of the proceeds of such Series Loan) at
the rate of one-quarter of one percent per annum. The Non-Usage Fee shall be
paid monthly in arrears, commencing at the end of the first month following the
Closing Date for such Series Loan.
I.7. Unallocated Commitment Fee.
Borrower agrees with each of the Primary Lenders for a Series Loan
that, if such Primary Lenders' Commitment Letters cover more than one Project,
then the maximum amount of such Series Loan is deducted from the "Commitment"
described in such Primary Lenders' Commitment Letters for purposes of
determining the amount of the "Unallocated Commitment" described therein.
Borrower reaffirms its obligation to pay to the Administrative Bank solely for
the ratably benefit of each such Primary Lender the Unallocated Commitment Fee
or the Commitment Fees described in such Commitment Letters at the rate and at
the times specified in such Commitment Letters.
21
I.8. Funding Losses.
Borrower acknowledges and agrees as follows: (i) Borrower has no right
to prepay the Notes for any Series Loan without the Super Majority Lenders'
consent, which has been granted only on the terms and subject to the conditions
set forth in Section I.3. and this Section; (ii) the Primary Lenders for such
Series Loan will be harmed by reason of any prepayment of the Notes for such
Series Loan at a time after its Fixed Rate Conversion Date when interest rates
have declined below the levels prevailing on such Fixed Rate Conversion Date or,
if earlier, the date such Primary Lenders locked in the interest rate on such
Notes, because any reinvestment of the prepaid funds at the lower rates
prevailing at the time of prepayment will produce a lower return to such Primary
Lenders; (iii) there is no readily available index of rates payable on loans
such as that from such Primary Lenders to Borrower, nor any assurance that such
Primary Lenders could replace such Series Loan with a similar loan; and (iv)
changes in the yields on U.S. government securities provide a reasonable
approximation for changes in interest rates generally.
Now, therefore, to induce such Primary Lenders to agree to accept
voluntary prepayments, Borrower agrees to pay to each such Primary Lender a
prepayment indemnity as described in this Section upon any prepayment, whether
voluntary, mandatory or upon acceleration of such Notes, and agrees to all of
the other terms of prepayment herein.
For purposes of this Section, and the following terms have the meaning
assigned to them:
"Average Initial Maturity Period" means the weighted average
time to scheduled maturity of the Notes for a Series Loan. Average
Initial Maturity Period shall be computed by multiplying the dollar
amount of each installment of principal of the Notes by the number of
days from such Series Loan's Fixed Rate Conversion Date until the
scheduled maturity of that installment, adding together the resulting
products and dividing the resulting sum by the total dollar amount of
principal of such Notes.
"Average Remaining Maturity Period" means the weighted average
time to scheduled maturity of the amount prepaid. Average Remaining
Maturity Period shall be computed by multiplying the dollar amount of
each installment of principal prepaid by the number of days from the
prepayment date until the scheduled maturity of that installment,
adding together the resulting products and dividing the resulting sum
by the total dollar amount of principal being prepaid.
"Government Yield" means, as of any date of determination, the
annual yield (converted as necessary to the equivalent semi-annual
compound rate) on a U.S. Treasury security having a maturity date
closest to the date computed by adding (i) for the Government Yield as
of the Fixed Rate Conversion Date for any Series Loan, the Average
Initial Maturity Period to its Fixed Rate Conversion Date or (ii) for
the Government Yield as of the prepayment date, the Average Remaining
Maturity Period to the date of prepayment, as published in The Wall
Street Journal (or, if not so
22
published, as determined by the Administrative Bank based on quotations
by secondary market dealers selected by the Administrative Bank). "U.S.
Treasury securities" means actively traded U.S. Treasury bonds, bills
and notes. If more than one issue of U.S. Treasury securities is
scheduled to mature at or about the time of such computed date, then to
the extent possible the U.S. Treasury security trading closest to its
par value will be chosen as the basis of the Government Yield.
"Interest Differential" means, as of any prepayment date for
any Series Loan, the Government Yield as of such Series Loan's Fixed
Rate Conversion Date minus the Government Yield as of such prepayment
date.
Any voluntary prepayment under the Notes for any Series Loan shall be either in
the full amount of such Series Loan or, if a partial prepayment, in the amount
required by Section I.3. If, at the time of any prepayment (whether voluntary,
mandatory or upon acceleration of the principal of such Notes), the Interest
Differential for such Series Loan shall exceed zero, such prepayment shall be
accompanied by payment of a prepayment indemnity. The amount of the prepayment
indemnity for any Series Loan shall equal the present value (determined by the
Administrative Bank using the Government Yield as of the date of prepayment as
the discount factor) on the prepayment date of a stream of equal monthly
payments in number equal to the number of whole months (using a thirty-day
month) in the Average Remaining Maturity Period. The amount of each such monthly
payment shall equal the quotient obtained by dividing (a) the product of the
amount prepaid, times the Interest Differential, times a fraction, the numerator
of which is the number of days in the Average Remaining Maturity Period and the
denominator of which is 360, by (b) the number of whole months (using a
thirty-day month) in the Average Remaining Maturity Period.
I.9. Discretion of Primary Lenders as to Manner of Funding.
Each Primary Lender for any Series Loan shall be entitled to fund and
maintain its funding of its Percentage of such Series Loan in any manner it may
elect, it being understood, however, that for the purposes of this Agreement all
determinations hereunder (including, but not limited to, determinations under
Section I.8.) shall be made as if such Primary Lender had actually funded and
maintained its Percentage of such Series Loan through the issuance of its
certificates of deposit, or the purchase of deposits, having a maturity
corresponding to the each scheduled principal installment payment date, bearing
an interest rate equal to the Government Yield on such Series Loan's Fixed Rate
Conversion Date.
I.10. Payments.
All payments and prepayments of principal of, and interest on, the
Notes and all fees payable with respect to any Loan shall be made, without
deduction, set-off, or counterclaim, in immediately available funds not later
than 2:00 p.m., Minneapolis time on the dates due, to the Administrative Bank at
the office specified by it from time to time. Funds received on any day after
2:00 p.m., Minneapolis time shall be deemed to have been received on the next
23
Business Day. Whenever any payment to be made hereunder or on the Notes 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 any interest or fees. Borrower hereby authorizes
the Administrative Bank to charge from time to time against Borrower's
account(s) with the Administrative Bank any such payments when due.
So long as no Event of Default has occurred and is continuing, the
Administrative Bank and each Lender may separately xxxx and collect from
Borrower for the Administrative Bank's or such Lender's costs and expenses that
are reimbursable by Borrower pursuant to this Agreement or any other Loan
Document; provided, however, that each Lender shall provide the Administrative
Bank with a copy of each invoice or statement sent to Borrower. If an Event of
Default has occurred and is continuing, then each Lender's reimbursable costs
and expenses shall be billed and collected through the Administrative Bank.
The Administrative Bank shall promptly distribute to each Lender all
payments of the principal of, or interest on, its Series Loans or other payments
due under this Agreement or any other Loan Document received by it for the
account of such Lender; provided, however, that:
(a) if the Administrative Bank has not received
sufficient funds to pay the principal of, or interest on, the Series
Loans when due and/or the fees payable with respect to any Series Loan
when due or if any other Event of Default has occurred and is
continuing, then all payments received by the Administrative Bank from
Borrower shall be allocated among the Administrative Bank and the
Lenders in accordance with Section I.11;
(b) the Administrative Bank may set off against any
amount distributable to any Lender the amount, if any, which such
Lender is obligated to pay to Administrative Bank under this Agreement
or any other Loan Document; and/or
(c) if Administrative Bank determines, through the
exercise of its reasonable business judgment supported by advice of
counsel, that any amount received and distributed by it under this
Agreement or any other Loan Document must be returned to Borrower or
paid to any other person pursuant to any insolvency law or otherwise,
then, notwithstanding any other term or condition of this Agreement or
any other Loan Document, each Lender will repay to Administrative Bank,
on demand, any portion of such amount that Administrative Bank has
distributed to such Lender, together with interest at such rate, if
any, as Administrative Bank is required to pay to Borrower or such
other Person, without set-off, counterclaim or deduction of any kind.
So long as no Event of Default has occurred and is continuing, each
Lender shall apply all amounts received by it (whether as a result of payment
transmitted by Borrower or otherwise) on account of payment of interest on or
principal of the Notes, or other payments
24
due under this Agreement or any other Loan Document, as the case may be, shall
be so applied by it to such payment.
I.11. Pro Rata Sharing.
Notwithstanding the provision of any Mortgage or any other Loan
Document to the contrary, each payment (including, without limitation, all
proceeds of the Collateral) on the Loans or other Obligations received by the
Administrative Bank, the Collateral Agent or any Lender after the occurrence and
during the continuance of any Event of Default shall be applied as follows:
(a) First, to the payment of costs, charges and expenses
of foreclosure and of sale and of all proper expenses (including court
costs and maximum attorneys' fees permitted by law including without
limitation, litigation preparation costs and expenses, paraprofessional
fees, secretarial overtime, depositions, electronic research, postage,
travel, communications and related costs and expenses, and expenses of
preparing any Project for sale, including, without limitation, all
costs and expenses of environmental testing, investigation, reporting,
remediation and clean-up), liabilities and advances incurred or made in
connection therewith or otherwise respectively incurred or made
hereunder by the Collateral Agent, the Administrative Bank and the
Lenders, and of all funds advanced by the Collateral Agent, the
Administrative Bank or the Lenders to pay "Impositions" (as defined in
the Mortgages), Liens and encumbrances superior to the lien of the
Mortgage; and
(b) Second, to each Lender ratably (without priority of
any one over any other except with respect to the Columbus Proceeds and
then the application of the Columbus Proceeds and all other amounts
applied among the Lenders in accordance with their respective Pro Rata
Shares is subject to Section I.12 below) in proportion to its Pro Rata
Share where the amounts received by each Lender shall be applied (for
purposes of making determinations under this Section only): (i) first,
to the unpaid interest and fees constituting part of such Lender's
Obligations; and (ii) second, to the unpaid Principal Amount of such
Lender's Obligations. If any payment to any Lender of its Pro Rata
Share of any distribution would result in overpayment to such Lender,
such excess amount shall instead be distributed in respect of the
unpaid indebtedness secured hereby of the other Lenders entitled to
such distribution, with each such other Lender to receive an amount
equal to such excess amount multiplied by a fraction the numerator of
which is the unpaid Principal Amount of the indebtedness secured hereby
of such other Lender and the denominator of which is the unpaid
Principal Amount of the indebtedness secured hereby of all such other
Lenders entitled to such distribution;
provided, however, that any payment received by the Collateral Agent, the
Administrative Bank or any Lender from the Columbus Proceeds or with respect to
the Series A Loan shall be paid over to, and/or retained by, US Bank subject to
Section I.12.
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For purposes of applying payments received in accordance with this
Section, the Administrative Bank shall be entitled to rely upon each Lender for
a determination of the outstanding principal, interest and other indebtedness
secured hereby owed to such Lender.
The provisions of Sections I.10., I.11. and I.12. shall control the
application of payments, notwithstanding any other provision of any Loan
Document to the contrary.
I.12. Columbus Project. US Bank, as the Primary Lender for the Series A
Loan, agrees with the Primary Lenders for each of the other Series Loans
(including itself as a Primary Lender for any of such other Series Loans), that,
if, following the occurrence and during the continuance of an Event of Default,
its Principal Amount will be reduced faster than another Lender's Principal
Amount is reduced because the Columbus Project does not cross-collateralize such
other Lender's Series Loans, then US Bank, contemporaneously with US Bank's
receipt of any non-shared payment on the Series A Loan, will purchase with its
own funds, and not with funds received from such payment, a last-out
participation in such other Lender's Series Loans in an amount equal to such
Lender's Pro Rata Share of such payment; provided, however, that if the
Administrative Bank determines, through the exercise of its reasonable business
judgment supported by advice of counsel, that any non-shared payment on the
Series A Loan received by it under this Agreement or any other Loan Document
must be returned to Borrower or paid to any other person pursuant to any
insolvency law or otherwise, then, notwithstanding any other term or condition
of this Agreement or any other Loan Document, each Lender which has sold a
participation to US Bank will repurchase, on demand, the applicable portion of
such participation, together with interest at such rate, if any, as US Bank is
required to pay to Borrower or such other Person, without set-off, counterclaim
or deduction of any kind.
II. CONDITIONS OF BORROWING
The provisions of this ARTICLE II shall separately apply to each Series
Loan and its Primary Lenders. Each defined term used in this ARTICLE II shall
have the meaning provided in this Agreement as supplemented by the Supplement
for such Series Loan.
The Primary Lenders for any Series Loan shall not be required to make
any Advances hereunder until the pre-closing requirements, conditions and other
requirements set forth below have been completed and fulfilled to the
satisfaction of such Primary Lenders, the Administrative Bank and the Collateral
Agent, at Borrower's sole cost and expense. It is agreed, however, that such
Primary Lenders, in their sole discretion but subject to the approval of the
Administrative Bank and the Collateral Agent, may make Advances prior to
completion and fulfillment of any or all of such pre-closing requirements,
conditions and requirements, without waiving their right to require such
completion and fulfillment before any additional Advances are made.
II.1. Pre-Closing Requirements.
At least ten (10) days prior to the closing of the relevant Series
Loan, Borrower shall provide to such Series Loan's Primary Lenders, the
Administrative Bank and the Collateral
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Agent each of the following, in form and substance acceptable to such Primary
Lenders, the Administrative Bank and the Collateral Agent:
A. A commitment for the Title Policy for the Project to be
financed by such Series Loan or a preliminary title report
from the Title Company, complying with the Administrative
Bank's standard requirements therefor, a copy of which has
been delivered to Borrower.
B. Two (2) complete sets of the Plans for such Project. All
mechanical, electrical, structural and other specialized
drawings shall be signed and sealed by an architect or
professional engineer holding a current license from the
jurisdiction in which such Project is located, in addition to
the Project Architect for such Project.
C. The General Contractor's construction contract for such
Project in a form acceptable to such Primary Lenders, all
other prime construction contracts for such Project signed by
Borrower, the Project Architect's agreement, a schedule
listing all first-tier subcontractors or materialmen to such
General Contractor's and all other prime contractor's
construction contracts relating to such Project.
D. Three (3) copies of a current, certified ALTA/ACSM LAND TITLE
SURVEY of the Land comprising part of such Project, which
shall also be prepared in accordance with the Administrative
Bank's standard requirements therefor, a copy of which has
been delivered to Borrower.
E. Soil reports on such Land, showing that the soil will
adequately support the Improvements comprising part of such
Project when constructed in accordance with the Plans for such
Project.
F. An Environmental Audit showing that no Pollutant is present
above, on, in or under such Project, and all reports, data and
other information produced in connection with the Tests for
such Project. The Environmental Audit shall also specify
whether or not any environmental assessment, study or
statement with respect to such Project is required by any
Governmental Requirement. If such an assessment, study or
statement is so required, Borrower shall provide a copy
thereof to such Primary Lenders, the Administrative Bank and
the Collateral Agent, and, if none is so required, Borrower
shall provide such Primary Lenders, the Administrative Bank
and the Collateral Agent with an appropriate declaration of
environmental non-significance relating to such Project, if
available in the jurisdiction in which such Project is
located.
G. The Sworn Construction Cost Statement for such Project.
H. Insurance policies for such Project written by insurers
satisfactory to such Primary Lenders, the Administrative Bank
and the Collateral Agent and in amounts satisfactory to such
Primary Lenders, the Administrative Bank and
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the Collateral Agent, prepared in accordance with the
Administrative Bank's standard requirements therefor, a copy
of which has been delivered to Borrower.
I. Borrower's estimated schedules for construction of the
Improvements for such Project and for disbursement of the
proceeds of such Series Loan.
J. Copies of all building permits required to complete
construction of the Improvements for such Project, and a
schedule of all other necessary licenses and permits which
must be obtained in order to occupy and operate such Project.
K. A letter addressed to the Administrative Bank and the
Collateral Agent from an appropriate municipal officer
regarding zoning and building code compliance by such Project,
prepared in accordance with the Administrative Bank's standard
requirements therefor, a copy of which has been delivered to
Borrower.
L. If and to the extent required by the Primary Lenders, letters
addressed to the Administrative Bank and the Collateral Agent
from the suppliers confirming the availability of water, storm
and sanitary sewer, gas, electric and telephone utilities for
such Project, prepared in accordance with the Administrative
Bank's standard requirements therefor, a copy of which has
been delivered to Borrower.
M. A letter addressed to the Administrative Bank and the
Collateral Agent from the Project Architect for such Project,
prepared in accordance with the Administrative Bank's standard
requirements therefor, a copy of which has been delivered to
Borrower.
N. UCC chattel lien searches from the appropriate offices in the
State in which such Project is located and from the Office of
the Secretary of State of Minnesota, covering the name of
Borrower.
O. A copy of the organization documents of Borrower including its
certificate of formation and all amendments thereto, certified
by the Delaware Secretary of State and its Limited Liability
Company Agreement and all amendments thereto certified by
Borrower's Secretary.
P. A Secretary's Certificate executed by the Secretary of
Borrower regarding:
(1) Resolutions authorizing the execution by the chief
manager or other designated officer or officers of
Borrower of the Loan Documents for such Series Loan
and all other documents or instruments required to be
executed and delivered in connection herewith and the
performance of the covenants and agreements required
hereby; and
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(2) Identity and specimen signature of the chief manager
and other designated officer or officers having
authority to execute and deliver such documents.
Q. A Certificate of Good Standing of recent date for Borrower
respectively issued by the Delaware Secretary of State, the
Minnesota Secretary of State and the Secretary of State of the
state in which such Project is located.
R. A Copy of the Project Lease for such Project certified by
Borrower to be true, accurate and complete copy thereof.
S. A copy of each noncancellable agreement relating to the
management, operation or maintenance of such Project and of
each such agreement which cannot be canceled by thirty (30)
days' or less notice.
T. A proposed Operating Budget for such Project for its first
five (5) years of operation.
U. The most current available financial statements of Borrower,
as well as financial statements of Borrower for the fiscal
year immediately preceding the time period covered by said
current financial statements, and, in the case of any annual
financial statement, certified by an independent certified
public accountant of recognized standing acceptable to such
Primary Lenders and the Administrative Bank.
V. The most current available financial statements of LTF, as
well as financial statements of LTF for each of the three (3)
full fiscal years immediately preceding the time period
covered by said current financial statements, and, in the case
of any annual financial statement, certified by an independent
certified public accountant of recognized standing acceptable
to such Primary Lenders and the Administrative Bank and copies
of the most current available consolidated federal income tax
returns (with all supporting schedules) signed and certified
as true, correct and complete by LTF.
W. A policy of flood insurance naming the Collateral Agent and
its assigns as additional insured, covering such Project in
the maximum amount available, or evidence satisfactory to the
Primary Lenders, the Administrative Bank and the Collateral
Agent that such Project is not located within a designated
flood plain.
X. Other agreements, documents and exhibits, without limitation,
which may be required, in such Primary Lenders', the
Administrative Bank's or the Collateral Agent's judgment, to
assure compliance with the requirements of this Agreement and
the other Loan Documents.
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Y. The remainder of Section II.1. is reserved and shall be
specified in any Supplement with respect to the Series Loan
set forth in such Supplement.
II.2. Loan Documents.
On or before the date of closing of such Series Loan, Borrower shall
execute and deliver (or cause to be executed and delivered) to the
Administrative Bank the following documents for such Series Loan and the Project
being financed with the proceeds thereof in form and substance acceptable to
such Series Loan's Primary Lenders, the Administrative Bank, the Collateral
Agent and to their respective counsel, to evidence and secure such Series Loan:
A. The Notes.
B. The Mortgage.
C. The Assignment.
D. An assignment of the Plans and of the Project Architect's
agreement pursuant to which the same were prepared, along with
written acknowledgment from the Project Architect authorizing
such Primary Lenders and the Administrative Bank to rely on
and utilize the Plans, without additional charge, and further
confirming to such Primary Lenders and the Administrative Bank
that, upon the occurrence of an Event of Default, the Project
Architect will cooperate with such Primary Lenders and the
Administrative Bank regarding the completion of construction
of such Project.
E. An assignment of Borrower's general construction contract for
the Project and an agreement from the General Contractor to
honor and perform the same for such Primary Lenders and the
Administrative Bank upon the occurrence of an Event of a
Default.
F. The Disbursing Agreement.
G. The Sworn Statement.
H. The Lease Subordination Agreement.
I. The Indemnity Agreement.
J. The Additional Project Collateral Document Amendments.
K. The Contingency Reserve Account Agreement.
L. Such other documents as such Primary Lenders, the
Administrative Bank or the Collateral Agent may reasonably
require to evidence and secure such Series Loan.
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The Mortgage, the Assignment and such other Loan Documents as may be
designated by such Primary Lenders, the Administrative Bank and/or the
Collateral Agent are to be placed of record, and such Primary Lenders, the
Administrative Bank and the Collateral Agent shall designate the order of
recording thereof, and the offices in which the same are to be recorded.
Borrower shall pay all documentary, recording and/or registration taxes and/or
fees, if any, due upon the Loan Documents.
II.3. Title Insurance.
The Collateral Agent shall have received the Title Policy for such
Project or a Title Commitment marked by the Title Company to provide gap
coverage between the date of the Title Commitment and the date of the recording
of the Mortgage.
II.4. Opinion of Borrower's Attorneys.
The Administrative Bank shall have received from outside counsel for
Borrower a current written opinion, in scope, form and substance acceptable to
such Primary Lenders, the Administrative Bank and the Collateral Agent.
II.5. Appraisal.
The Administrative Bank shall have received a current appraisal of such
Project addressed to the Administrative Bank and such Primary Lenders prepared
by an appraiser acceptable to the Administrative Bank in substantial conformance
with the regulations promulgated by the appropriate federal regulatory agency
pursuant to Section 1110 of the Financial Institutions Reform, Recovery and
Enforcement Act of 1989 (12 U.S.C. Section 3339), as amended, and the
regulations thereunder, which appraisal shall have been reviewed and approved by
the Administrative Bank's internal appraisal group and which appraisal shall
determine that the maximum principal amount of the Notes is not greater than the
Maximum Loan Amount.
II.6. Primary Lenders' Loan Fee.
The Administrative Bank shall have received, in immediately available
funds, for the ratable benefit of such Primary Lenders, the "Construction/Term
Loan Fee" described in the Commitment Letters for such Series Loan ("Loan Fees")
which is payable at Closing. The Loan Fees are earned on the date of payment and
are not refundable under any circumstances.
II.7. Other Fees.
The Administrative Bank shall have received, in immediately available
funds, for its own accounts, the Administrative Bank Fees for such Series Loan.
The Administrative Bank Fees are earned on the date of payment and are not
refundable under any circumstances.
II.8. Collateral Agency Agreement.
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With respect to any Series Loan which closed prior to the Effective
Date, each Primary Lender for such Series Loan shall become a "Secured Party" to
the Collateral Agency Agreement by executing and delivering the "Joinder"
attached to the Original Agreement.
II.9. Other Conditions Precedent.
Section II.9. is reserved and shall be specified in any Supplement with
respect to the Series Loan set forth in such Supplement.
II.B. CONDITIONS TO EFFECTIVE DATE
This Agreement shall become effective on the date (the "Effective Date)
when, and only when, the Lender shall have received:
A. Counterparts of this Agreement executed by the
Borrower and the Series Lenders for each of the Series A through E
Loans;
B. The Refinance Loan shall have been integrated into
this Agreement by, among other things: (1) US Bank's execution of the
Series F Supplement to this Agreement and assignment of the Refinance
Mortgage and related security documents covering the Refinance Project
(together with the Refinance Mortgage, the "Refinance Loan Assigned
Security Documents") to the Collateral Agent; and (B) the Borrower's
and the Collateral Agent's execution and delivery of amended and
restated Refinance Loan Assigned Security Documents together with a
Title Policy (or Title Commitment with appropriate gap coverage)
complying with this Agreement;
C. The Xxxx Loan shall have been integrated into this
Agreement by, among other things: (1) US Bank's execution of the Series
G Supplement to this Agreement and assignment of the Xxxx Mortgage and
related security documents covering the Refinance Project (together
with the Xxxx Mortgage, the "Xxxx Loan Assigned Security Documents") to
the Collateral Agent; and (B) the Borrower's and the Collateral Agent's
execution and delivery of amended and restated Xxxx Loan Assigned
Security Documents together with a Title Policy (or Title Commitment
with appropriate gap coverage) complying with this Agreement; and
D. Simultaneously with the satisfaction of the
conditions precedent specified in subsections A. through C., above, the
Series H Loan is closed following the satisfaction of the conditions
precedent set forth in ARTICLE II.
III. ADVANCES OF LOAN PROCEEDS
The provisions of this ARTICLE III shall separately apply to each
Series Loan and its Primary Lenders. Each defined term used in this ARTICLE III
shall have the meaning provided in this Agreement as supplemented by the
Supplement for such Series Loan.
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III.1. General.
The proceeds of each Series Loan shall be advanced by its Primary
Lenders, for the benefit of Borrower, in accordance with the terms and
conditions set forth in this ARTICLE III, and in accordance with the Disbursing
Agreement; provided, however, that no such Primary Lender shall be obligated to
make any Advance if, after giving effect to such Advance, the aggregate amount
of Advances made by such Primary Lender would exceed its Individual Commitment
at such time or such Series Loan would exceed the lesser of the Commitment or
the Maximum Loan Amount. All monies advanced by such Primary Lenders (including
amounts payable to any such Primary Lender, the Administrative Bank or the
Collateral Agent and advanced by such Primary Lenders for payment to itself, the
other Primary Lenders for such Series Loan, the Administrative Bank or the
Collateral Agent) shall constitute Advances of the proceeds of such Series Loan
made to Borrower under this Agreement, evidenced by such Series Loan's Notes and
secured by such Series Loan's Loan Documents, and interest shall be computed
thereon, as prescribed by this Agreement and the Notes, from the date Borrower's
loan account for such Series Loan is charged with the amount of the Advance,
whether or not an Advance made to the Title Company is fully disbursed by the
Title Company or is withheld in full or in part.
Such Primary Lenders reserve the right to make Advances of amounts
which are allocated to any of the designated items in such Series Loan's Sworn
Construction Cost Statement for such other purposes or in such different
proportions as such Primary Lenders and the Administrative Bank may, in their
sole discretion, deem necessary or advisable. Borrower may not reallocate items
in such Sworn Construction Cost Statement without the prior written consent of
such Primary Lenders and the Administrative Bank; provided, however, that as to
closed-out line items contained in the Sworn Construction Cost Statement for
which there remains any unallocated and unused surplus amounts, and so long as
no Default or Event of Default has occurred and is continuing, Borrower, without
the prior written consent of such Primary Lenders and the Administrative Bank,
may reallocate such amounts to other line items contained in such Sworn
Construction Cost Statement relating to hard Project costs, but only so long as
the as the Applicable Series Loan remains in Balance. Non-material reallocations
of amounts as originally allocated in such Sworn Construction Cost Statement
which are specifically and separately referred to in any Draw Request (in the
form of the AIA's Application and Certificate for Payment (AIA Document G702)
and related Continuation Sheets (AIA Document G703)) provided for in the
Disbursing Agreement and are clearly set forth in the related construction Draw
Request shall be deemed consented to by such Primary Lenders and the
Administrative Bank upon such Primary Lender's and the Administrative Bank's
approval of such Draw Requests for payment.
No Advance shall constitute a waiver of any condition precedent to the
obligation of any such Primary Lender to make any further Advance or preclude
such Primary Lenders and the Administrative Bank from thereafter declaring the
failure of Borrower to satisfy any such condition precedent to be an Event of
Default. All conditions precedent to the obligation of such Primary Lenders to
make any Advance are imposed hereby solely for the benefit of such Primary
Lenders, and no other party may require satisfaction of any such condition
33
precedent or shall be entitled to assume that such Primary Lenders will make or
refuse to make any Advance in the absence of strict compliance with such
condition precedent.
Each such Primary Lender will advance to the Administrative Bank, when
due, from the proceeds of such Series Loan, without further order or request
from Borrower, such Primary Lender's Percentage of: (a) all interest payable to
Lenders under the terms hereof or of such Series Loan' s Notes; and (b) all
other sums due or to become due to the Administrative Bank, such Primary Lenders
or the Collateral Agent under this Agreement or under any of the other Loan
Document with respect to such Series Loan.
In the event that the total amount of such Series Loan exceeds the
amount needed to fully pay all cost allocations set forth on such Sworn
Construction Cost Statement approved by such Primary Lenders and the
Administrative Bank, such Primary Lenders shall not be required to make any
Advance with respect to such excess, and Borrower shall not be entitled to
receive, the excess.
III.2. Loan in Balance.
The Primary Lenders for any Series. Loan shall not be obligated to make
any Advance of proceeds of such Series Loan unless and until Borrower has
provided such Primary Lenders, the Administrative Bank and the Collateral Agent
with evidence, acceptable to such Primary Lenders and the Administrative Bank,
that such Series Loan is in Balance: i.e. (a) that Borrower has paid, in cash,
costs of the Project being financed by such Series Loan equal to: (i) the amount
of the capital contribution specified in the Supplement for such Series Loan,
which capital contributions by Borrower are to be made from capital
contributions made to Borrower from LTF; and (ii) the amount of other cash
contributions from third parties required by the Supplement for such Series
Loan, and (b) that all remaining unpaid costs of such Project, as determined by
such Primary Lenders and the Administrative Bank but, in all events including
interest on such Series Loan through its Conversion Date, do not exceed the
unadvanced portion of such Series Loan's Maximum Loan Amount.
Notwithstanding any provision of this Agreement or of the Disbursing
Agreement for such Series Loan to the contrary, in the event that such Primary
Lenders and the Administrative Bank, on the one hand, or Borrower, on the other
hand, determine that the unadvanced portion of such Maximum Loan Amount is
insufficient to cover any cost allocation set forth on such Series Loan's Sworn
Construction Cost Statement, to complete such Project, including all tenant
improvements, to pay all costs and expenses of Completion and pay interest on
such Series Loan through the Conversion Date, it shall notify the other party of
such determination, and Borrower shall, within three (3) Business Days following
demand, deposit with the Administrative Bank funds equal to said insufficiency
in order to bring such Series Loan back into Balance; provided, however, that if
Borrower fails to timely make such deposit, then the Collateral Agent, upon the
written request of the Administrative Bank, shall withdraw the required amount
from the funded portion of the Contingency Reserve and/or may draw on the
Contingency Reserve LC and the Collateral Agent shall
34
deposit the required amount with the Administrative Bank. Borrower, within three
(3) Business Days following the Collateral Agent's notice to Borrower that it
has withdrawn the required amount from the Contingency Reserve and/or has drawn
on the Contingency Reserve LC for the required amount, shall replenish the
Contingency Reserve to $500,000.00 either by depositing immediately available
funds with the Collateral Agent and/or causing the Contingency Reserve LC to be
reinstated; provided further, however, that: (a) Borrower's obligation to make
such deposit shall not be relieved or discharged by a draw on the Contingency
Reserve LC unless the issuing bank has paid the Collateral Agent's draw thereon
within five (5) Business Days after the date on which the Collateral Agent
submitted the relevant draw thereon to such issuing bank; or (b) if the
Collateral Agent fails to submit, or is enjoined or barred from submitting, a
draw on the Contingency Reserve LC for any reason whatsoever or if the issuing
bank fails to honor such draw within such five (5) day period for any reason
whatsoever, then Borrower, within three (3) Business Days following the
Collateral Agent's notice to Borrower that a draw on the Contingency Reserve LC
will not fund the deposit, shall deposit with the Collateral Agent the required
funds.
The Primary Lenders for each Series Loan hereby agree with the Primary
Lenders for the other Series Loans that the funded portion of the Contingency
Reserve (including, without limitation, the proceeds from any draw on the
Contingency Reserve LC) shall be held, invested and disbursed in accordance with
the Contingency Reserve Account Agreement.
III.3. Inspections.
Each Primary Lender for a Series Loan, the Administrative Bank, the
Collateral Agent, the Title Company, the Inspecting Architect, Consultants and
their respective representatives shall have access to the Project being financed
by such Series Loan at all reasonable times and shall have the right to enter
such Project and to conduct such inspections thereof as they shall deem
necessary or desirable for the protection of such Primary Lender's, the
Administrative Bank's and the Collateral Agent's interests.
The Administrative Bank may retain the Inspecting Architect, and any
other Consultants deemed necessary or desirable by the Administrative Bank, at
Borrower's expense, to make periodic inspections of such Project and to review
all change orders relating to such Project. The Administrative Bank may, and at
the written request of the Required Lenders for such Series Loan shall, request
the Inspecting Architect, before any Advance of the proceeds of such Series Loan
is made, to inspect all work and materials for which payment is requested and
all other work upon such Project, review the current Draw Request, approve such
work and Draw Request and/or submit to such Primary Lenders and the
Administrative Bank a progress inspections report. In addition, the
Administrative Bank may, and at such Required Lenders' written request shall,
retain such other Consultants as the Administrative Bank or such Required
Lenders deem necessary or convenient to perform such services as may, from time
to time, be required by such Required Lenders or the Administrative Bank in
connection with such Series Loan, this Agreement, such Series Loan's other Loan
Documents or such Project.
35
Neither Borrower nor any third party shall have the right to use or
rely upon the reports of the Inspecting Architect or any other reports generated
by any such Primary Lender, the Administrative Bank, the Collateral Agent or any
Consultant for any purpose whatsoever, whether made prior to or after
commencement of construction. Borrower shall be responsible for making its own
inspections of such Project during the course of construction and shall
determine to its own satisfaction that the work done and materials supplied are
in accordance with applicable contracts with its contractors. By advancing funds
after any inspection of such Project by any Primary Lender, the Administrative
Bank, Collateral Agent, any Consultant or the Inspecting Architect, neither such
Primary Lenders nor the Administrative Bank shall be deemed to waive any Event
of Default, waive any right to require construction defects to be corrected, or
acknowledge that all construction conforms with the Plans.
Notwithstanding any provisions of this Agreement or of the Disbursing
Agreement to the contrary, in the event that such Required Lenders or the
Administrative Bank should determine that the actual quality or value of the
work performed or the materials furnished does not correspond with the quality
or value of the work required by the Plans for such Project, then the
Administrative Bank shall notify Borrower of the objections thereto, and, upon
demand, Borrower shall correct the conditions to which such Required Lenders or
the Administrative Bank objects.
III.4. Lender Responsibility.
It is expressly understood and agreed that none of the Lenders, the
Administrative Bank, the Collateral Agent, any Consultant or the Inspecting
Architect, assume any liability or responsibility for the sufficiency of the
proceeds of any Series Loan to complete the Project being financed by such
Series Loan, for protection of such Project, for the satisfactory completion of
such Project, for inspection during construction, for the adequacy or accuracy
of such Series Loan's Sworn Construction Cost Statement, for any representations
made by Borrower, or for any acts on the part of Borrower or its contractors to
be performed in the construction of such Project.
III.5. Contingency Reserve.
The funded portion of the Contingency Reserve (including, without
limitation, the proceeds from any draw on the Contingency Reserve LC) shall be
held, invested and disbursed in accordance with the Contingency Reserve Account
Agreement. The Contingency Reserve shall be applied to pay construction costs
for the Improvements only in accordance with Section III.2. Borrower grants to
the Collateral Agent for the benefit of itself and the Administrative Bank and
the ratable benefit of the Lenders a security interest in the Contingency
Reserve and all funds on deposit with respect thereto.
III.6. Procedures for Advances.
(a) REQUEST FOR ADVANCES. Any request by Borrower for an
Advance of the proceeds of any Series Loan shall be made in accordance
with the Disbursing
36
Agreement for such Series Loan, at least 10 Business Days prior to the
date of the requested Advance.
(b) ALL ADVANCES. Not less than three (3) Business Days
prior to the date of any Advance pursuant to a request by Borrower, the
Administrative Bank shall give prompt telephonic notice to each Primary
Lender for such Series Loan of the anticipated Advance. Each such
Primary Lender, by not later than 10:00 a.m. (Minneapolis time) on the
date of such Advance, shall make available to the Administrative Bank,
in immediately available funds, such Primary Lender's Percentage of
such Advance. If the Administrative Bank receives each such Primary
Lender's portion of the Advance on or before 10:00 a.m. (Minneapolis
time) and unless any such Primary Lender has notified the
Administrative Bank in writing that such Primary Lender has determined
that any applicable condition specified in ARTICLE III has not been
satisfied (in which case the Administrative Bank will promptly notify
Borrower in writing of such determination), the Administrative Bank
will make the amount of the requested Advance available to the Title
Company for such Series Loan by 12:01 p.m. (Minneapolis time) on such
date, in accordance with such Disbursing Agreement.
Unless the Administrative Bank shall have been notified by any
such Primary Lender in writing, prior to the date of an Advance, that
such Primary Lender does not intend to make available to the
Administrative Bank its Percentage of such Advance, the Administrative
Bank may assume that each such Primary Lender has made such amount
available to the
Administrative Bank on such date, and the Administrative Bank
may, in reliance upon such assumption, make available to Borrower a
corresponding amount. Should any such Primary Lender fail to make
available to the Administrative Bank its Percentage of any Advance
(such Primary Lender, in such case a "Defaulting Lender"), the other
Primary Lenders for such Series Loan shall be obligated to make
available to the Administrative Bank their respective Percentages of
any Advance, but no such other Primary Lender shall be responsible for
the failure of any Defaulting Lender to make available to the
Administrative Bank such `Defaulting Lender's Percentage of any such
Advance. Borrower and any Defaulting Lender jointly and severally agree
to repay to the Administrative Bank on demand the amount payable by any
Defaulting Lender, together with interest thereon at the Variable Rate
if paid by Borrower and at the rate specified below, if repaid by
Defaulting Lender; provided, however, if such Defaulting Lender shall
pay to the Administrative Bank its Percentage of any Advance together
with interest thereon as provided in this Section, the amount paid
shall constitute such Defaulting Lender's Advance for purposes of this
Agreement, and, after such payment, Defaulting Lender shall again be a
Lender for the purposes of this Agreement. So long as any Lender is a
Defaulting Lender hereunder, (p) the Defaulting Lenders shall pay to
the Administrative Bank interest (and interest shall accrue and be
payable thereon) on Defaulting Lender's Percentage of such Advance
until such Advance is paid to the Administrative Bank at a rate equal
37
to the Variable Rate, commencing on the date such Advance was to have
been made to the Administrative Bank, and (q) it shall not be deemed to
be a Lender for the purposes of determining whether all Lenders,
Required Lenders or the Super Majority Lenders have approved or given
their consent to any action, inaction or other matter under this
Agreement. Notwithstanding anything contained herein to the contrary,
no Defaulting Lender shall be entitled to receive any payment of any
Obligation relating to its Series Loan until the date on which all
Primary Lenders for such Series Loan who are not Defaulting Lenders
have received repayment in full of their Obligations for such Series
Loan except that if an Event of Default has occurred and is continuing
prior to such date, then the Defaulting Lender shall be entitled to
receive payments in accordance with the Mortgage described in the
Supplement for such Series Loan. The Administrative Bank, in its
reasonable business judgment, may distribute any payment received by it
which would otherwise be distributable to such Defaulting Lender to the
other Primary Lenders for such Series Loan who are not Defaulting
Lenders or may retain such payment in a non-interest bearing account
for subsequent distribution to such Defaulting Lender if it ceases to
be a Defaulting Lender except that if an Event of Default has occurred
and is continuing prior to such distribution, the Administrative Bank
shall distribute such payment in accordance with the Mortgage described
in the Supplement for such Series Loan. In addition to the remedies set
forth in this Section III.6., Borrower and the Administrative Bank
shall be entitled to pursue all other remedies available at law or in
equity against any Defaulting Lender.
The Primary Lenders for any Series Loan who are not Defaulting
Lenders may, at their option, without any obligation to do so, provide
funds, pro rata, to permit the Advance to Borrower of an amount equal
to the Percentage of such Advance of any Defaulting Lender. If such
other Primary Lenders fund their respective Percentages of said Advance
and/or the Defaulting Lender's Percentage thereof, then simultaneously
with the funding by each of such other Primary Lenders (each
hereinafter called a "Funding Lender") of their respective Percentages
of such Advance (such an Advance is sometimes hereinafter called a
"Partial Advance") and/or of the Defaulting Lender's Percentage of an
Advance, the respective Percentages of principal Advances (hereinafter
called "Funded Percentage") of each Defaulting Lender and of each
Funding Lender shall automatically be adjusted so that following such
adjustment each such Primary Lender's Funded Percentage shall
correspond to the aggregate percentage of all then outstanding Advances
(including all Partial Advances) made by such Primary Lender. Following
any adjustment of each Primary Lender's Funded Percentage pursuant to
the preceding sentence, such Primary Lender's Funded Percentage shall
be restored only upon the first to occur of (x) a Defaulting Lender
subsequently funding its Percentage of any such Partial Advance, and/or
(y) the repayment in full (including all interest thereon) to each
Funding Lender of its Percentage of any such Partial Advance. and/or
Defaulting Lender's Percentage of an Advance.
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If after any Primary Lender for a Series Loan becomes a
Defaulting Lender, Borrower, the Administrative Bank, Defaulting Lender
or any Funding Lender is able to find another bank, insurance company
or other financial institution which is willing and able to purchase a
Defaulting Lender's Percentage, at par, and to assume a Defaulting
Lender's duties and obligations hereunder (hereinafter called
"Substitute Lender"), and if Borrower, the Administrative Bank and all
Funding Lenders approve said Substitute Lender, which approval of said
Substitute Lender shall not be unreasonably withheld, delayed or
conditioned, the Defaulting Lender shall promptly and properly assign
its Percentage to said Substitute Lender, but with warranties of title
and of no prior assignment, and shall withdraw as a Lender hereunder,
in return for payment from said Substitute Lender, in immediately
available funds, in an amount equal to all unpaid principal and accrued
interest then represented by said Percentage and for the written
assumption by said Substitute Lender of all duties and obligations of
the Defaulting Lender thereafter arising under this Agreement, it being
understood and agreed that the Defaulting Lender shall remain liable to
Borrower and to the other Primary Lenders for such Series Loan for
matters accruing prior to the date of the assumption by the Substitute
Lender.
IV. REPRESENTATIONS AND WARRANTIES OF BORROWER
Borrower represents, warrants and covenants to Lenders, the
Administrative Bank and the Collateral Agent that:
IV.1. Legal Status of Borrower.
Borrower is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of Delaware and is
duly qualified to do business in each jurisdiction in which a Project is
located, and has all power, authority, permits, consents, authorizations and
licenses necessary to carry on its business, to construct, equip, own and
operate the Project and to execute, deliver and perform this Agreement and the
other Loan Documents; as of the Closing Date for a Series Loan, the equity
ownership of Borrower is set forth on Schedule IV.1. attached to the most recent
Supplement and incorporated herein by reference and, except as set forth in said
Schedule IV.I., Borrower has not granted or issued, or has agreed to grant or
issue, any options, warrants or similar rights to any Person to acquire any
shares of, or other securities convertible into, Borrower's members' interest;
all resolutions of the governors and/or members of Borrower necessary to
authorize the execution, delivery and performance of this Agreement and of the
other Loan Documents which have been or are to be executed by and on behalf of
Borrower have been duly adopted and are in full force and effect; and this
Agreement and such other Loan Documents have been duly authorized, executed and
delivered by and on behalf of Borrower so as to constitute this Agreement and
such other Loan Documents the valid and binding obligations of Borrower,
enforceable in accordance with their respective terms, subject to limitations as
to enforceability which might result from bankruptcy, insolvency, moratorium and
other similar laws affecting creditors' rights generally and subject to
limitation on the availability of equitable remedies.
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IV.2. Title.
Except as otherwise provided in the Supplement for a Series Loan, the
Borrower is the owner, in fee simple, of the Land, subject to no lien, charge,
mortgage, deed of trust, restriction or encumbrance, except Permitted
Encumbrances.
IV.3. No Breach of Applicable Agreements or Laws.
The consummation of the transactions contemplated hereby and the
execution, delivery and/or performance of this Agreement and the other Loan
Documents will not result in any breach of or constitute a default under any
mortgage, deed of trust, lease, bank loan agreement, credit agreement, or other
instrument, to which Borrower is a party, or by which Borrower or any Project
may be bound or affected or violate any Governmental Requirements applicable to
Borrower or any Project.
IV.4. No Litigation or Defaults.
There are no actions, suits or proceedings pending or, to the knowledge
of the Borrower, threatened against or affecting Borrower, Lessee, any Affiliate
of Borrower or Lessee or any Project, or involving the validity or
enforceability of the Loan Documents or the priority of the Lien thereof, at law
or in equity; and neither Borrower, Lessee, nor any such Affiliate of Borrower
or Lessee is in default under any order, writ, injunction, decree or demand of
any court or any administrative body having jurisdiction over Borrower, Lessee
or such Affiliate.
IV.5. Financial and Other Information
A. The financial statements of Borrower previously or hereafter
delivered to Lenders and the Administrative Bank including,
without limitation, the unaudited financial statements of
Borrower described in the most recent Supplement fairly and
accurately present, or will fairly and accurately present, the
financial condition of Borrower as of the dates of such
statements, and neither this Agreement nor any document,
financial statement, financial or credit information,
certificate or statement referred to herein or furnished to
Lenders or the Administrative Bank by Borrower contains, or
will contain, any untrue statement of a material fact or
omits, or will omit, a material fact, or is or will be
misleading in any material respect. There has been no material
adverse change in the condition, financial or otherwise, of
Borrower since the latest [audited] financial statements
delivered to Lenders and the Administrative Bank.
B. The financial statements of LTF previously or hereafter
delivered to Lenders and the Administrative Bank including,
without limitation, the audited and unaudited financial
statements of LTF described in the most recent Supplement,
fairly and accurately present, or will fairly and accurately
present, the financial condition of LTF as of the dates of
such statements, and neither
40
this Agreement nor any document, financial statement,
financial or credit information, certificate or statement
referred to herein or furnished to Lenders or the
Administrative Bank by LTF contains, or will contain, any
untrue statement of a material fact or omits, or will omit, a
material fact, or is or will be misleading in any material
respect. There has been no material adverse change in the
condition, financial or otherwise, of LTF since the latest
audited financial statements delivered to Lenders and the
Administrative Bank.
IV.6. No Defaults under Loan Documents or Other Agreements
There is, and, until Lenders have been fully repaid the entire
indebtedness evidenced or to be evidenced by the Notes, there will be, no
Default or Event of Default on the part of Borrower or any Affiliate of Borrower
under the Loan Documents and no default or event of default on the part of
Borrower or any Affiliate of Borrower under any other document to which Borrower
or any such Affiliate is a party and which relates to the ownership, occupancy,
use, development, construction or management of the Project; and on the date
hereof and after giving effect hereto, Borrower and any such Affiliate are not,
and will not be, in default in the payment of the principal or interest on any
of its indebtedness for borrowed money, and are not, and will not be, in default
under any instrument or agreement under and subject to which any indebtedness
for borrowed money has been issued or is secured; and no event has occurred, or
will occur, which, with the lapse of time or the giving of notice or both, would
constitute an Event of Default thereunder.
IV.7. Boundary Lines; Conformance with Governmental Requirements and
Restrictions
The exterior lines of the Improvements for each Project are, and at all
times will be, within the boundary lines of the Land for such Project, and
Borrower has examined and is familiar with all applicable covenants, conditions,
restrictions and reservations, and with all applicable Governmental
Requirements, including but not limited to building codes and zoning,
environmental, hazardous substance, energy and pollution control laws,
ordinances and regulations affecting such Project, and each Project will in all
respects conform to and comply with said covenants, conditions, restrictions,
reservations and Governmental Requirements.
IV.8 Loan in Balance
Each Series Loan is in Balance, or, if not, Borrower is prepared to
deposit with the Administrative Bank funds equal to said insufficiency in order
to bring such Series Loan into Balance as required by Section III.2. hereof.
IV.9. ERISA
During the five (5) fiscal year period immediately preceding the date
of the most recent Supplement, neither Borrower nor any of its ERISA Affiliates
has maintained, established, sponsored or contributed to any Employee Benefit
Plan which is a defined benefit plan.
41
IV.10. Ownership of Property; Liens
Borrower has good and marketable title to its real properties and good
and sufficient title to its other properties, including all properties and
assets referred to as owned by Borrower in the audited financial statements of
Borrower delivered to Lenders and the Administrative Bank pursuant to Section
IV.5. or (other than property disposed of since the date of such financial
statements in the ordinary course of business). None of the properties, revenues
or assets of Borrower is subject to a Lien securing the payment of Indebtedness
for borrowed money (including, without limitation thereof, guaranties thereof),
except for: (a) Liens listed on Schedule IV.10 attached to the most recent
Supplement and incorporated herein by reference; or (b) Liens allowed under
Section V.25.
IV.11. Taxes
Borrower has filed all federal, state and local tax returns required to
be filed and has paid or made provision for the payment of all taxes due and
payable pursuant to such returns and pursuant to any assessments made against it
or any of its property and all other taxes, fees and other charges imposed on it
or any of its property by any governmental authority (other than taxes, fees or
charges the amount or validity of which is currently being contested in good
faith by appropriate proceedings and with respect to which reserves in
accordance with GAAP have been provided on the books of Borrower). No tax Liens
have been filed and no material claims are being asserted with respect to any
such taxes, fees or charges. The charges, accruals and reserves on the books of
Borrower in respect of taxes and other governmental charges are adequate.
IV.12. Subsidiaries
As of the date of the most recent Supplement, Borrower does not have
any Subsidiaries.
IV.13. Partnerships and Joint Ventures
As of the date of the most recent Supplement, the Borrower is not a
partner (limited or general) in any partnership or a joint venturer in any joint
venture.
IV.14. Insurance
Schedule IV.14 attached to the most recent Supplement and incorporated
herein by reference sets forth a summary of the property and casualty insurance
program carried by Borrower on the date hereof, including any self-insurance or
risk assumption agreed to by Borrower or imposed upon Borrower by any such
insurer.
IV.15. Availability of Utilities.
42
All utility services necessary for the operation of each Project for
its intended purpose are available at such Project, including water, storm and
sanitary sewer, drainage, gas, electric and telephone facilities.
IV.16. Government Consent.
No order, consent, approval, license, authorization or validation of,
or filing, recording or registration with, or exemption by, any governmental or
public body or authority is required on the part of Borrower to authorize, or is
required in connection with the execution, delivery and performance of, or the
legality, validity, binding effect or enforceability of, the Loan Documents
except for the recording of the Mortgage and Assignment described in the most
recent Supplement in the appropriate real estate recording offices and of UCC
Financing Statements in the recording offices required by the Uniform Commercial
Code respectively enacted in the State of Minnesota and the state in which the
Project described in such Supplement is located.
IV.17. Burdensome Restrictions.
Borrower is not a party to or otherwise bound by any indenture, loan or
credit agreement or any lease or other agreement or instrument which would
foreseeably have a material adverse effect on the business, properties, assets,
operations or condition (financial or otherwise) of Borrower or on its ability
to carry out Borrower's obligations under the Loan Documents.
IV.18. Full Disclosure.
Subject to the following sentence, neither the financial statements
referred to in Section IV.5. nor any other certificate, written statement,
exhibit or report furnished by or on behalf of Borrower, LTF or any Substitute
Lessee in connection with or pursuant to this Agreement, taken as a whole,
contains any untrue statement of a material fact or omits to state any material
fact necessary in order to make the statements contained therein not misleading.
Certificates or statements furnished by or on behalf of Borrower, LTF or any
Substitute Lessee to Lenders and the Administrative Bank consisting of
projections or forecasts of future results or events have been prepared in good
faith and based on good faith estimates and assumptions of the management of
Borrower, LTF or Substitute Lessee, as the case may be, and Borrower has no
reason to believe that such projections or forecasts are not reasonable.
IV.19. Year 2000.
Borrower has reviewed and assessed its business operations and computer
systems and applications to address the "year 2000 problem" (that is, that
computer applications and equipment used by Borrower, directly or indirectly
through third parties, may be unable to properly perform date-sensitive
functions before, during and after January 1, 2000). Borrower represents and
warrants that the year 2000 problem has not resulted in, and will not result in,
a material adverse change in Borrower's business condition (financial or
43
otherwise), operations, properties or prospects or ability to repay Lenders.
Borrower agrees that this representation will be true and correct on and shall
be deemed made by Borrower on each date Borrower requests any advance under this
Agreement or the Notes or delivers any information to any Lender. Borrower will
promptly deliver to the Administrative Bank and any Lenders such information
relating to this representation and covenant as the Administrative Bank or such
Lender requests from time to time.
IV.20. Other Representations and Warranties.
Section IV.20. is reserved and shall be specified in any Supplement
with respect to the Series Loan set forth in such Supplement.
THE WARRANTIES AND REPRESENTATIONS IN THIS ARTICLE IV, AND ANY
ADDITIONAL WARRANTIES AND REPRESENTATIONS CONTAINED HEREIN, IN ANY SUPPLEMENT
HERETO AND IN THE OTHER LOAN DOCUMENTS, SHALL BE DEEMED TO HAVE BEEN RENEWED AND
RESTATED BY BORROWER AT THE TIME OF EACH REQUEST BY BORROWER FOR AN ADVANCE OF
LOAN PROCEEDS.
V. COVENANTS OF BORROWER
While this Agreement is in effect, and until Lenders have been paid in
full the principal of and interest on all Advances made by Lenders hereunder and
under the other Loan Documents:
V.1. Completing Construction.
Construction of each Project shall commence not later than the Closing Date for
such Project specified in the Supplement for the Applicable Series Loan.
Borrower shall not become a party to any contract, including the General
Contractor's construction contract, for the performance of any work on any
Project or for the supplying of any labor, materials or services for
construction of the Improvements for such Project, except upon such terms and
with such parties as shall be approved in writing by the Primary Lenders for the
Applicable Series Loan, the Administrative Bank and the Collateral Agent. No
approval by such Primary Lenders, the Administrative Bank and the Collateral
Agent of any contract or change order shall make any Lender, the Administrative
Bank or the Collateral Agent responsible for the adequacy, form or content of
such contract or change order. Borrower shall expeditiously complete and fully
pay for the development and construction of each Project in a good and
workerlike manner and in accordance with the contracts, subcontract and Plans
for such Project submitted to and approved by the Primary Lenders for the
Applicable Series Loan and the Administrative Bank, and in compliance with all
applicable Governmental Requirements, any other document or instrument
identified in Section V.1. of the Supplement for such Series Loan and any
covenants, conditions, restrictions and reservations applicable thereto, so that
Completion of the Improvements for such Project occurs on or before such Series
Loan's Completion Date. Borrower assumes full responsibility for the compliance
of the Plans and the Projects with all Governmental Requirements, any other
document or
44
instrument identified in Section V.1. of the Supplement for the Applicable
Series Loan and with sound building and engineering practices, and,
notwithstanding any approvals by any Lenders and the Administrative Bank, none
of the Lenders, the Administrative Bank or the Collateral Agent shall have any
obligation or responsibility whatsoever for the Plans or any other matter
incident to any Project or the construction of the Improvements for such
Project. Borrower shall correct or cause to be corrected (a) any defect in the
Improvements for any Project, (b) any departure in the construction of the
Improvements from the Plans or Governmental Requirements, any other document or
instrument identified in Section V.1. of the Supplement for the Applicable
Series Loan, and (c) any encroachment by any part of the Improvements for such
Project or any other structure located on the Land for such Project on any
building line, easement, property line or restricted area. Borrower shall cause
all roads necessary for the utilization of each Project for its intended
purposes to be completed and dedicated (if dedication thereof is required by any
governmental authority), the bearing capacity of the soil on the Land for such
Project to be made sufficient to support such Project's Improvements, and
sufficient local utilities to be made available to such Project and installed at
costs (if any) set out in the Sworn Construction Cost Statement for the
Applicable Series Loan, on or before such Series Loan's Completion Date.
V.2. Changing Costs, Scope or Timing of Work
Borrower shall deliver to the Primary Lenders for the Applicable Series
Loan and the Administrative Bank revised, sworn statements of estimated costs of
the relevant Project, showing changes in or variations from the original Sworn
Construction Cost Statement for such Series Loan as soon as such changes are
known to Borrower; provided that Borrower shall not be required to do so if: (a)
the changes in costs are shown on a Borrower's Draw Request (in the form of the
AIA's Application and Certificate for payment (AIA Document G702) and related
Continuation Sheets (AIA Document G703)) within 30 days of the date of the
relevant change in costs and, if such change increases the costs, such Draw
Request is accompanied by a cash deposit equal to the amount of such increase;
(b) the changes in costs do not arise from the addition of a new, substitute or
replacement General Contractor, subcontractor or vendor; (c) the changes in
costs do not arise from the addition of a new, substitute or replacement
contract; (d) no Default or Event of Default has occurred and is continuing at
the time of the relevant changes in costs. Borrower shall deliver to such
Primary Lenders and the Administrative Bank a revised construction schedule, if
and when any target date set forth therein has been delayed by ten (10)
consecutive days or more, or when the aggregate of all such delays equals thirty
(30) days or more.
Borrower shall furnish to the Inspecting Architect for the Applicable
Series Loan with one (1) copy of all changes and modifications to the Plans for
such Project promptly upon such Project's Completion and to the Primary Lenders
for such Series Loan, the Administrative Bank and the Collateral Agent with two
(2) copies of the "as-built" Plans upon such Completion. No work may be
performed pursuant to any change order or pending change order prior to delivery
thereof to such Primary Lenders and the Administrative Bank. Borrower shall not
make or consent to any change or modification in such Plans, contracts or
subcontracts, and no work shall be performed with respect to any such change or
45
modification, without the prior written consent of such Primary Lenders and the
Administrative Bank (and, if such change or modification would require Borrower
to make a deposit under Section III.2. or this Section, the Collateral Agent),
if such change or modification would: (a) in any material way, alter the design
or structure of such Project; or (b) cause the Applicable Series Loan to be out
of Balance. As a condition to consenting to any change or modification
increasing such Project's cost, Borrower shall deposit cash equal to such
increase.
Any cash deposit required by this Section shall be held and advanced by
the Administrative Bank pursuant to the terms hereof and the Disbursing
Agreement.
V.3. Balancing the Loan
Borrower shall furnish to the Primary Lenders for the Applicable Series
Loan and the Administrative Bank, as and when required by the Required Lenders
for such Series Loan or the Administrative Bank, at such Required Lenders' or
Administrative Bank's respective option: (a) satisfactory evidence of Borrower's
ability to pay all unpaid costs of completing, leasing-up and operating the
relevant Project through such Series Loan's Conversion Date, and/or (b) to the
extent required by Section I11.2. or Section V.2. hereof, cash equal to any
difference between such unpaid costs and the unadvanced portion of the Maximum
Loan Amount, which shall be held and advanced by the Administrative Bank
pursuant to the terms hereof and the Disbursing Agreement.
V.4. Paving Costs of Project and Loan
Borrower shall pay and discharge, when due, all taxes, assessments and
other governmental charges upon each Project, as well as all claims for labor
and materials which, if unpaid, might become a Lien or charge upon such Project;
provided, however, that Borrower shall have the right to contest the amount,
validity and/or applicability of any of the foregoing in strict accordance with
the terms of the Mortgage described in the Supplement for the Applicable Series
Loan.
V.5. Using Loan Proceeds
Borrower shall use the proceeds of each Series Loan solely to pay, or
to reimburse Borrower for paying, costs and expenses shown on such Series Loan's
Sworn Construction Cost Statement and incurred by Borrower in connection with
the acquisition and development of the Land described in the Supplement for such
Series Loan, the construction of the Improvements on such Land and the equipping
of such Improvements, together with other expenses set forth on such Sworn
Construction Cost Statement and such incidental costs and expenses relating
thereto as may be approved from time to time in writing by the Primary Lenders
for such Series Loan and the Administrative Bank (and, if such change or
modification would require Borrower to make a deposit under Section III.2. or
Section V.2., the Collateral Agent). Borrower shall take all steps necessary to
assure similar use of the proceeds of such Series Loan by its contractors and
subcontractors.
46
V.6. Keeping of Records
Borrower shall set up and maintain accurate and complete books,
accounts and records pertaining to each Project in a manner reasonably
acceptable to the Primary Lenders for the Applicable Series Loan, the
Administrative Bank and the Title Company for such Series Loan. Borrower will
permit representatives of Lenders, the Administrative Bank, the Collateral
Agent, the Inspecting Architect and each Title Company to have free access to
and to inspect and copy all books, records and contracts of Borrower. Any such
inspection by Lenders, the Administrative Bank, the Collateral Agent and/or the
Inspecting Architect shall be for the sole benefit and protection of Lenders,
the Administrative Bank and the Collateral Agent, and neither any Lender, the
Administrative Bank nor the Collateral Agent shall have any obligation to
disclose the results thereof to Borrower or to any third party.
V.7. Providing Financial Information
Borrower shall furnish such financial information concerning Borrower
and the Project as any Lender, the Administrative Bank or the Collateral Agent
may request, and shall furnish to Lenders and the Administrative Bank:
A. As soon as available and in any event within 120 days after
the end of each fiscal year of Borrower, the annual audit
report of the Borrower prepared in conformity with GAAP,
consisting of at least statements of operations and retained
earnings and cash flows, and a balance sheet as at the end of
such year, setting forth in each case in comparative form
corresponding figures from the previous annual audit,
certified without qualification by independent certified
public accountants of recognized standing selected by Borrower
and acceptable to the Super Majority Lenders and the
Administrative Bank, together with any management letters,
management reports or other supplementary comments or reports
to Borrower or its board of directors furnished by such
accountants.
B. As soon as available and in any event within 120 days after
the end of each fiscal year of LTF, the annual audit report of
LTF prepared in conformity with GAAP, consisting of at least
statements of operations and retained earnings and cash flows,
and a balance sheet as at the end of such year, setting forth
in each case in comparative form corresponding figures from
the previous annual audit, certified without qualification by
independent certified public accountants of recognized
standing selected by LTF and acceptable to the Super Majority
Lenders and the Administrative Bank, together with any
management letters, management reports or other supplementary
comments or reports to Borrower or its board of directors
furnished by such accountants.
C. As soon as available and in any event within 120 days after
the end of each fiscal year of any Substitute Lessee, the
annual audit report of such Substitute Lessee prepared in
conformity with GAAP, consisting of at least statements of
operations and retained earnings and cash flows, and a balance
sheet as at the
47
end of such year, setting forth in each case in comparative
form corresponding figures from the previous annual audit,
certified without qualification by independent certified
public accountants of recognized standing selected by
Substitute Lessee and acceptable to the Super Majority Lenders
and the Administrative Bank, together with any management
letters, management reports or other supplementary comments or
reports to Substitute Lessee or its board of directors
furnished by such accountants.
D. Together with the audited financial statements required under
Section V.7.A., a statement by the accounting firm performing
such audit stating that it has reviewed this Agreement and
that in performing its examination nothing came to its
attention that caused it to believe that any Default or Event
of Default exists, or, if such Default or Event of Default
exists, describing its nature.
E. As soon as available and in any event within 30 days after the
end of each month of each fiscal year of Borrower, a copy of
the unaudited financial statement of Borrower prepared in a
manner consistent with the form of current period statements
being prepared by Borrower as of the date of this Agreement,
signed by Borrower's chief manager or other designated officer
acceptable to the Super Majority Lenders and the
Administrative Bank (the chief manager and each such other
acceptable designated officer being a "Designated Officer").
F. Intentionally Omitted.
G. As soon as available and in any event within 30 days after the
end of each month of each fiscal year of LTF, a copy of the
unaudited financial statements of LTF prepared in a manner
consistent with the form of current period statements being
prepared by LTF as of the date of this Agreement and including
operating information for each Project on a Project by Project
basis, signed by LTF's chief financial officer.
H. Together with the financial statements required under Section
V.7.G. coinciding with the end of the Borrower's fiscal year,
a compliance certificate in the form of Exhibit A attached
hereto covering all Projects that have been completed, signed
by a Designated Officer.
I. Immediately upon becoming aware of any Default or Event of
Default, a notice describing the nature thereof and what
action the Borrower proposes to take with respect thereto.
J. Immediately upon becoming aware of the occurrence, with
respect to any Employee Benefit Plan, of any Reportable Event
or any "prohibited transaction" (as defined in Section 4975 of
the Code), a notice specifying the nature thereof and what
action Borrower proposes to take with respect thereto,
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and, when received, copies of any notice from PBGC of
intention to terminate or have a trustee appointed for any
Plan.
K. Immediately upon becoming aware of the occurrence thereof,
notice of the institution of any litigation, arbitration or
governmental proceeding against Borrower or Lessee or any of
its property which, if determined adversely to Borrower or
Lessee, would constitute an Adverse Event, or the rendering of
a judgment or decision in such litigation or proceeding which
constitutes an Adverse Event, and the steps being taken by
Borrower or Lessee with respect thereto.
L. Immediately upon becoming aware of the occurrence thereof,
notice of any violation as to any environmental matter by the
Borrower and of the commencement of any judicial or
administrative proceeding relating to health, safety or
environmental matters: (i) in which an adverse determination
or result could result in the revocation of or have a material
adverse effect on any permits held by Borrower which are
material to the operations of Borrower; or (ii) which will or
threatens to impose a material liability on Borrower to any
Person or which will require a material expenditure by
Borrower to cure any alleged problem or violation.
M. By not later than November 30 of each year, projections by
Lessee for Lessee's immediately following fiscal year
consisting of monthly balance sheets and monthly and
year-to-date income statements and monthly operating
statements for each Project on a Project by Project basis
together with the assumptions underlying such projections
certified by Lessee's chief financial officer or treasurer as
being the most probable course of Lessee's business based on
such assumptions.
N. From time to time, such other information regarding the
business, operation and financial condition of Borrower, LTF
or Lessee as any Lender, the Administrative Bank or the
Collateral Agent may reasonably request.
V.8 Providing Operating Budgets.
Intentionally Omitted.
V.9. Providing Leasing Information
Intentionally Omitted.
V.10. Providing Updated Surveys
At such times as the Required Lenders for a Series Loan or the
Administrative Bank may deem appropriate, Borrower shall furnish to each of the
Primary Lenders for such Series Loan, the Administrative Bank and the Collateral
Agent three (3) copies of a certified survey
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of the Project being financed by such Series Loan, certifying that the
Improvements for such Project are constructed within the property lines of such
Project's Land, do not encroach upon any easement affecting such Land and do
comply with all applicable Governmental Requirements relating to the location of
such Improvements, along with a letter from the Title Company for such Series
Loan confirming the acceptability of said survey.
V.11. Providing Evidence of Completion
Upon Completion of the Improvements for a Project, and prior to the
final Advance of the proceeds of the Applicable Series Loan to pay for hard
costs of construction of such Project (including tenant improvements), including
but not limited to any retainage therefor, and as a condition of the same,
Borrower shall furnish to the Primary Lenders for such Series Loan, the
Administrative Bank and the Collateral Agent with all items required to evidence
such Project's Completion, including but not limited to such additional evidence
of zoning compliance as such Primary Lenders or the Administrative Bank may
require, including unconditional occupancy permits and a 3.1 zoning with parking
endorsement to the Title Policy for such Project ; a final, certified "as-built
survey" (three (3) copies) for such Project together with a update survey
endorsement to the Title Policy for such Project; certification from the Project
Architect that such Project has been completed in accordance with the approved
Plans; the evidence of insurance required by Section V.12. hereof; tenant
estoppel letters; copies of all warranties covering materials, equipment and
appliances included within such Project; copies of all licenses and permits
required for operation of such Project; mechanic's lien waivers for the entire
cost of such Project from each and every subcontractor and materialman on such
Project, a sworn certification from the General Contractor for such Project and
any other prime contractor stating that all subcontractors and materialman are
paid and no claims exist; and photographs of the completed Improvements.
V.12. Maintaining Insurance Coverage
Borrower shall, at all times until Lenders have been fully repaid all
Indebtedness evidenced by the Notes, maintain, or cause to be maintained, in
effect (and shall furnish to the Primary Lenders for the Applicable Series Loan,
the Administrative Bank and the Collateral Agent copies of), insurance policies
covering each Project, as required under the Mortgage described in the
Supplement for such Series Loan, and shall furnish to such Primary Lenders, the
Administrative Bank and the Collateral Agent proof of payment of all premiums
for such insurance.
V.13. Transferring, Conveying or Encumbering the Project
Without, in each instance, the prior written consent of the Super
Majority Lenders, the Administrative Bank and the Collateral Agent, Borrower
shall not voluntarily or involuntarily agree to, cause, suffer or permit (a) any
sale, transfer or conveyance of any interest of Borrower, legal or equitable, in
any Project or any part or portion thereof except for the Project Lease for such
Project; or (b) any mortgage, pledge, encumbrance or Lien to be imposed or
remain outstanding against any Project, or any Lien to exist thereon, except as
created by the Loan Documents, and except for Permitted Encumbrances.
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V.14. Complying with the Loan Documents and Other Documents
Borrower shall comply with and perform all of its agreements and
obligations under the Loan Documents and under all other contracts and
agreements to which Borrower is a party relating to the ownership, occupancy,
use, development, construction or management of each Project, and shall comply
with all requests by any Lender, the Administrative Bank and the Collateral
Agent which are consistent with the terms of such Loan Documents.
V.15. Updated Appraisals
Borrower agrees that the Required Lenders for any Series Loan, the
Administrative Bank or the Collateral Agent shall have the right to obtain, at
Borrower's expense, an updated appraisal of the Project being financed by such
Series Loan, prepared in accordance with Section II.5. hereof and approved by
the Administrative Bank's internal appraisal group, at least annually or more
frequently at any time that (a) an Event of Default shall have occurred
hereunder, (b) such Required Lenders, the Administrative Bank or the Collateral
Agent determines, in its reasonable opinion, that the security for such Series
Loan has been physically or financially impaired in any material manner, or (c)
such appraisal is required by then current banking regulations. In the event
that such Required Lenders, the Administrative Bank or the Collateral Agent
shall elect to obtain such an appraisal, the Administrative Bank may immediately
commission an appraiser acceptable to such Required Lenders, the Administrative
Bank and the Collateral Agent at Borrower's cost and expense, to prepare the
appraisal and Borrower shall fully cooperate with the Administrative Bank and
the appraiser in obtaining the necessary information to prepare such appraisal.
In the event that Borrower fails to cooperate with the Administrative Bank in
obtaining such an appraisal or in the event that Borrower shall fail to pay for
the cost of such appraisal and the Administrative Bank's internal appraisal fee
of immediately upon demand, such event shall constitute an Event of Default
hereunder and the Administrative Bank shall be entitled to exercise all remedies
available to it hereunder. In the event that any such appraisal shall determine
that the outstanding principal balance of such Series Loan is greater than the
Maximum Loan Amount and Borrower fails to prepay, within ten (10) days after
written notice from the Administrative Bank to Borrower, the outstanding
principal balance of such Series Loan to the extent necessary to reduce said
principal balance down to no more than the Maximum Loan Amount, such event shall
constitute an Event of Default hereunder and Lenders, the Administrative Bank
and Collateral Agent shall be entitled to exercise all remedies available to it
hereunder. Any such prepayment shall not require the payment of the prepayment
premium as described in Section I.8.
V.16. Company Existence
Borrower shall maintain its existence as a limited liability company
and its good standing under the laws of its jurisdiction of organization and its
qualification to transact business in each jurisdiction in which the character
of the properties owned, leased or operated by it or the business conducted by
it makes such qualification necessary. Borrower shall not:
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A. merge or consolidate with or into any other Person;
B. convey, transfer, lease or otherwise dispose of (whether in
one transaction or in a series of transactions) all or any
substantial part of its assets (whether now owned or hereafter
acquired) to any Person or entity; or
C. acquire all, or substantially all, of the assets of any Person
or entity except that Borrower may acquire additional sports
and health club projects.
For purposes of this Section, "substantial" shall mean assets or related groups
of assets having an aggregate book value of $500,000.00 or more as shown on
Borrower's balance sheet as of the end of its then most recently ended fiscal
year.
V.17. Payment of Taxes and Claims
Borrower shall file all tax returns and reports which are required by
law to be filed by it and pay before they become delinquent all taxes,
assessments and governmental charges and levies imposed upon it or its property
and all claims or demands of any kind (including, without limitation, those of
suppliers, mechanics, carriers, warehouses, landlords and other like Persons)
which, if unpaid, might result in the creation of a Lien upon its property;
provided that the foregoing items need not be paid if they are being contested
in good faith by appropriate proceedings, and as long as Borrower's title to its
property is not materially adversely affected, its use of such property in the
ordinary course of its business is not materially interfered with and adequate
reserves with respect thereto have been set aside on the Borrower's books in
accordance with GAAP.
V.18. Inspection
Borrower shall permit any Person designated by any Lender, the
Administrative Bank or the Collateral Agent to visit and inspect its books and
financial records, to examine and to make copies of its books of accounts and
other financial records, and to discuss the affairs, finances and accounts of
Borrower with, and to be advised as to the same by, its officers at such
reasonable times and intervals as any Lender, the Administrative Bank or the
Collateral Agent may designate; provided, that so long as no Default or Event of
Default has occurred and is continuing, each Lender, the Administrative Bank,
the Collateral Agent and their respective representatives shall use their best
efforts to co-ordinate their inspections so that such inspections occur at the
same time. So long as no Event of Default exists at the time of any such visit,
inspection or examination or any such inspection or examination does not reveal
significant errors or discrepancies in the most recent financial and operating
statements furnished to any Lender, the Administrative Bank or the Collateral
Agent, the expenses of the relevant inspecting Person for such visits,
inspections and examinations shall be at the expense of such inspecting Person;
provided that any such visit, inspection, or examination made while any Event of
Default is continuing or which reveals any such significant error or discrepancy
shall be at the expense of Borrower.
V.19. Books and Records
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Borrower shall keep adequate and proper records and books of account in
which full and correct entries will be made of its dealings, business and
affairs.
V.20. Compliance
Borrower shall comply in all material respects with all Governmental
Requirements and with all orders, writs, judgments, injunctions, decrees or
awards to which it or any Project may be subject.
V.21. ERISA
Neither Borrower nor any of its ERISA Affiliates shall maintain,
establish, sponsor or contribute to any Employee Benefit Plan which is a defined
benefit plan or to any Multi-employer Plan.
V.22. Change in Nature of Business
Borrower shall not make any material change in the nature of the
business of the Borrower as carried on at the date hereof.
V.23. Partnerships and Joint Ventures
Borrower shall not form or enter into any partnership as a limited or
general partner or form or enter into any joint venture.
V.24. Indebtedness
Borrower shall not incur, create, issue, assume or suffer to exist any
Indebtedness for borrowed money (including, without limitation, guaranties
thereof) except Indebtedness under this Agreement.
V.25. Liens
Borrower shall not create, incur, assume or suffer to exist any Lien
securing the payment of Indebtedness for borrowed money (including, without
limitation, guaranties thereof and any mechanic's lien) except Permitted
Encumbrances and Liens created by any of the Loan Documents.
V.26. Transactions with Related Parties
Except as provided in the Project Leases, Borrower shall not: (a)
permit the direct or indirect transfer, distribution or payment of any of its
funds, assets or property to any Related Party, except that the Borrower may
pay: (i) bona fide employee compensation (including benefits) to Related Parties
for services actually rendered to such Person; (ii) expenses incurred by an
employee in the ordinary course of business; (iii) expenses or rents for
services or property or the use thereof allocated to such Person; provided,
however, that all such payments pursuant to subsections (a)(i), (ii) and (iii)
shall not exceed the amount which
53
would be payable in a comparable arm's length transaction with a third party who
is not a Related Party; (b) lend or advance money, credit or property to any
Related Party; (c) invest in (by capital contribution or otherwise) or purchase
or repurchase any stock or indebtedness, or any assets or properties, of any
Related Party; or (d) guarantee, assume, endorse or otherwise become responsible
for, or enter into any agreement or instrument for the purpose of discharging or
assuming (directly or indirectly, through the purchase of goods, supplies or
services or otherwise) the indebtedness, performance, capability, obligations,
dividends or agreement for the furnishing of funds of any Related Party or any
officer, director or employee thereof.
V.27. Fiscal Year
Borrower shall not change its fiscal year.
V.28. Debt Service Coverage.
Borrower shall receive in cash each month, commencing on the "Rent
Commencement Date" (as defined in the Project Lease for the Applicable Series
Loan), the required payments of Base Rent for that month under such Project
Lease; provided, however, that the minimum required monthly cash payments of
Base Rent under such Project Lease shall not be less than 125% of the scheduled
monthly installment payments of principal and interest on such Applicable Series
Loan that are established for the period following such Series Loan's Conversion
Date; provided, however, that, Borrower may pay Rebatable Rent with respect to
any calendar year to the Lessee so long as: (a) no Default or Event of Default
has occurred and is continuing on the date of such payment; and (b) such payment
is not made prior to the date which is thirty (30) days after the date on which
Borrower delivers its annual audited financial statements to the Administrative
Bank and Lenders pursuant to Section V.7.(a) for its fiscal year which is
co-terminus with the relevant calendar year.
V.29. Restricted Dividends.
Borrower shall not purchase or redeem any of its member interests or
pay any distributions with respect thereto, make any distribution to members as
such, or set aside any funds for any such purpose except that, so long as, no
Event of Default has occurred and is continuing at the time of the following
distributions, or would result therefrom, Borrower may pay distribute capital to
its members in the amount equal to such persons' federal and state income tax
liability arising from their respective allocable share of Borrower's taxable
income so long as Borrower is a pass-through tax entity under the Code (such
distributions being the "Tax Distributions"); provided, however, that: (a) each
person's federal and state income tax liability shall be computed on the basis
of the highest marginal combined tax rate possible under the Code and Minnesota
law; (b) Tax Distributions shall be paid in estimated quarterly installments
contemporaneously with the recipients' obligations to pay estimated income taxes
based upon the Borrower's taxable income through the end of its fiscal quarter
immediately preceding such tax installment's due date and also contemporaneously
with any such recipients' filing of such recipients' federal and state income
tax returns if the estimated Tax Distributions paid for any of the Borrower's
fiscal years are not sufficient to pay such
54
recipients' actual income tax liability arising from such recipients' share of
Borrower's actual taxable income for such fiscal year as disclosed by copies of
Borrower's tax returns and related Schedules K-1 for such fiscal year delivered
to the Administrative Bank pursuant to this Agreement; and (c) if the Tax
Distributions actually paid with respect to any of Borrower's fiscal years
exceed the Tax Distributions permitted by this Section based upon Borrower's
actual taxable net income as disclosed by copies of such tax returns and
schedules described above, then Borrower shall immediately recover the excess
amount from the recipient and shall not pay any further Tax Distribution to any
person until such excess amount is recovered.
V.30. Depositing Collections.
Borrower shall deposit all collections with respect to the Project
Leases in accounts maintained at the Administrative Bank and, if required by the
Administrative Bank or the Super Majority Lenders, in separate accounts for each
Project Lease.
V.31. Collateral Agent Refinance Mortgage; etc.
Intentionally Omitted.
V.32. Other Covenants.
Section V.32. is reserved and shall be specified in any Supplement with
respect to the Series Loan set forth in such Supplement.
VI. DEFAULTS
VI.1. Events of Default
Any of the following events shall constitute an Event of Default under
this Agreement:
A. Borrower shall default in the payment of principal due
according to the terms hereof or of any of the Notes.
B. Borrower shall default in the payment of interest on the
Notes, or in the payment of fees or other amounts payable to
the Administrative Bank, Lenders or the Collateral Agent
hereunder, under the Notes or under any of the other Loan
Documents.
C. Borrower shall default (other than default described in other
subsections of this Section VI.1.) in the performance or
observance of any agreement, covenant or condition required to
be performed or observed by Borrower under the terms of this
Agreement or any other Loan Document and such default is not
cured within thirty (30) days after the Administrative Bank
gives written notice thereof to Borrower.
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D. Any representation or warranty made by Borrower, LTF or Lessee
in this Agreement, in any of the other Loan Documents, or in
any certificate or document furnished under the terms of this
Agreement or in connection with any Loan, shall be untrue or
incomplete in any material respect.
E. Work on any Project shall be substantially abandoned, or
shall, by reason of Borrower's fault, be unreasonably delayed
or discontinued for a period of thirty (30) days, or
construction shall be delayed for any reason whatsoever to the
extent that completion of such Project cannot, in the
reasonable judgment of the Required Lenders for the Applicable
Series Loan, be accomplished prior to the such Series Loan's
Completion Date or Completion does not occur by such
Completion Date, in either case, as such Completion Date may
be extended by the Administrative Bank in accordance with the
definition of "Completion."
F. Borrower or Lessee shall commit an act of bankruptcy; or shall
apply for, consent to or permit the appointment of a receiver,
custodian, trustee or liquidator for it or any of its property
or assets; or shall fail to, or admit in writing its inability
to, pay its debts as they mature; or shall make a general
assignment for the benefit of creditors or shall be
adjudicated bankrupt or insolvent; or shall take other similar
action for the benefit or protection of its creditors; or
shall give notice to any governmental body of insolvency of
pending insolvency or suspension of operations; or shall file
a voluntary petition in bankruptcy or a petition or an answer
seeking reorganization or an arrangement with creditors, or to
take advantage of any bankruptcy, reorganization, insolvency,
readjustment of debt, rearrangement, dissolution, liquidation
or other similar debtor relief law or statute; or shall file
an answer admitting the material allegations of a petition
filed against it in any proceeding under any such law or
statute; or shall be dissolved, liquidated, terminated or
merged; or shall effect a plan or other arrangement with
creditors; or a trustee, receiver, liquidator or custodian
shall be appointed for it or for any of its property or assets
and shall not be discharged within sixty (60) days after the
date of his appointment; or a petition in involuntary
bankruptcy or similar proceedings is filed against it and is
not dismissed within sixty (60) days after the date of its
filing.
G. Borrower fails to timely comply with its obligations under
Section III.2. to deposit funds to keep a Series Loan in
Balance.
H. For any reason, the Lessee declares a default by Borrower
under the terms of any Project Lease following the expiration
of any cure period available to Borrower under the sublease.
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I. Any "Event of Default" (howsoever defined) occurs under any
Project Lease following the expiration of any cure period
available to Lessee under the Project Lease.
J. A judgment or judgments for the payment of money in excess of
the sum of $100,000.00 in the aggregate shall be rendered
against Borrower or $200,000.00 in the aggregate against
Lessee, as the case may be, and Borrower or Lessee shall not
discharge the same or provide for its discharge in accordance
with its terms, or procure a stay of execution thereof, prior
to any execution on such judgments by such judgment creditor,
within 30 days from the date of entry thereof, and within said
period of 30 days, or such longer period during which
execution of such judgment shall be stayed, appeal therefrom
and cause the execution thereof to be stayed during such
appeal.
K. The maturity of any Indebtedness of Borrower (other than
Indebtedness under this Agreement or the other Loan Documents
or the Refinance Loan or the Xxxx Loan) or Lessee in the
aggregate amount of more than $500,000.00 for Borrower or
Lessee, as the case may be, shall be accelerated, or Borrower
or Lessee shall fail to pay any such Indebtedness when due or,
in the case of such Indebtedness payable on demand, when
demanded, or any event shall occur or condition shall exist
and shall continue for more than the period of grace, if any,
applicable thereto and shall have the effect of causing, or
permitting (any required notice having been given and grace
period having expired) the holder of any such Indebtedness or
any trustee or other Person acting on behalf of such holder to
cause such Indebtedness to become due prior to its stated
maturity or to realize upon any collateral given as security
therefor unless Borrower or Lessee is contesting, in good
faith by appropriate actions or proceedings, the right of the
holder of such Indebtedness to accelerate or demand payment
thereof.
L. Any creditor of Borrower shall commence foreclosure, replevin
or other proceedings against any of the Collateral and such
proceeding shall remain unstayed or unbonded for 10
consecutive days.
M. A default occurs in the performance of Borrower's obligations
in Section V.13. or V.15. or any of Sections V.16. through
V.29. (both inclusive) hereof.
N. Any Change of Control shall occur.
O. Intentionally Omitted.
P. Intentionally Omitted.
Q. Intentionally Omitted.
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R. The remainder of Section VI.1. is reserved and shall be
specified in any Supplement with respect to the Series Loan
set forth in such Supplement.
VI.2. Rights and Remedies
Upon the occurrence of an Event of Default, unless such Event of
Default is subsequently waived in writing by the Super Majority Lenders or, if
required by Section VIII.10., all Lenders, the Administrative Bank may, and upon
the written direction of the Super Majority Lenders, shall, exercise any or all
of the following rights and remedies, consecutively or simultaneously, and in
any order:
A. Suspend any Primary Lenders' obligations to make Advances
under this Agreement, without notice to Borrower.
B. Terminate any Commitment without notice to Borrower, whereupon
such Commitment shall terminate.
C. Declare the entire unpaid principal balance of the Notes to be
immediately due and payable, together with accrued and unpaid
interest on the Notes, without notice to or demand on
Borrower.
D. Exercise, and/or direct the Collateral Agent to exercise, any
or all remedies specified herein and in the other Loan
Documents, including (without limiting the generality of the
foregoing) the right to foreclose the Mortgages, and/or any
other remedies which it may have therefor at law, in equity or
under statute.
E. Cure the Event of Default on behalf of Borrower, and, in doing
so, may enter upon any Project, and may expend such sums as it
may deem desirable, including attorneys' fees, all of which
shall be deemed to be Advances hereunder, even though causing
the Applicable Series Loan to exceed the face amount of the
Notes, shall bear interest at the Default Rate provided
therein and shall be payable by Borrower on demand.
VI.3. Completion of Project by Lenders
In addition, in case of the occurrence of an Event of Default specified
in Section VI.1.E. or F. hereof, or any Event of Default caused by, or which
results in, Borrower's failure, for any reason, to continue with construction of
any Project as required by this Agreement, then, in addition to, or in concert
with, the other remedies referred to above, the Administrative Bank may (but
shall not be obligated to), and upon the written direction of the Lenders shall
take over and complete construction of such Project in accordance with the
Plans, with such changes therein as the Lenders or the Administrative Bank may,
in their respective discretion, deem appropriate, all at the risk, cost and
expense of Borrower. The Administrative Bank may assume or reject any contracts
entered into by Borrower in connection with such Project, may enter into
additional or different contracts for
58
work, services, labor and materials required, in the judgment of the
Administrative Bank, to complete such Project, and may pay, compromise and
settle all claims in connection with such Project. All sums, including
attorneys' fees of the Lenders, the Administrative Bank and the Collateral
Agent, and charges or fees for supervision and inspection of the construction
and for any other necessary or desirable purpose in the discretion of the
Administrative Bank expended by any Lender, the Administrative Bank or the
Collateral Agent in completing or attempting to complete such Project (whether
aggregating more, or less, than the face amount of the Notes), shall be deemed
Advances made by the Lenders to Borrower hereunder, and Borrower shall be liable
to the Lenders, on demand, for the payment of such sums, together with interest
on such sums from the date of their expenditure at the rates provided herein.
The Lenders, in their discretion, may abandon work on such Project,
after having commenced such work, and may recommence such work at any time, it
being understood that nothing in this Section shall impose any obligation on any
Lender either to complete or not to complete such Project. For the purpose of
carrying out the provisions of this Section, Borrower irrevocably appoints the
Administrative Bank its attorney-in-fact, with full power of substitution, to
execute and deliver all such documents, to pay and receive such funds, and to
take such action as may be necessary, in the judgment of the Administrative
Bank, to complete such Project. This power of attorney is coupled with an
interest and is irrevocable. None of the Lenders, the Administrative Bank or the
Collateral Agent, however, shall have any obligation to undertake any of the
foregoing, and, if the Lenders undertake any of the same in their discretion,
they shall have no liability for the adequacy, sufficiency or completion
thereof.
VI.4. Other Remedies.
Section VI.4 is reserved and shall be specified in any Supplement with
respect to the Series Loan set forth in such Supplement.
VII. ADMINISTRATIVE BANK; ETC
VII.1. Appointment and Authorization.
Each Lender hereby appoints U.S. National Association Bank as
Administrative Bank and Collateral Agent and authorizes the Administrative Bank
and the Collateral Agent to act on such Lender's behalf to the extent provided
herein or under any other Loan Document or in connection therewith, and to take
such other action and exercise such other powers as may be reasonably incidental
thereof. Each Lender hereby agrees to be bound by the terms and conditions of
each Loan Document and consents to the execution and delivery and/or acceptance
of such Loan Documents by the Administrative Bank and the Collateral Agent.
VII.2. Power.
The Administrative Bank and the Collateral Agent shall have and may
exercise such powers under this Agreement and any other Loan Documents as are
specifically delegated to
59
the Administrative Bank or the Collateral Agent, as the case may be, by the
terms hereof or thereof, together with such powers as are reasonably incidental
thereto. As to any matters not expressly provided for by the Loan Documents
(including, without limitation, enforcement or collection of the Notes), neither
the Administrative Bank nor the Collateral Agent shall be required to exercise
any discretion or take any action, but shall be required to act or to refrain
from acting (and shall be fully protected in so acting or refraining from
acting) upon the instructions of the Required Lenders or the Super Majority
Lenders, as the case may be, to the extent that such Required Lenders or Super
Majority Lenders are permitted by this Agreement or any other Loan Document to
instruct the Administrative Bank or the Collateral Agent and such instructions
shall be binding upon all Primary Lenders and all holders of the Notes for the
Applicable Series Loan where the Required Lenders are permitted to issue such
instructions or upon all Lenders and all holders of the Notes for all Loans
where the Super Majority Lenders are permitted to issue such instructions;
provided, however, that neither the Administrative Bank nor the Collateral Agent
shall be required to take any action which exposes such Person to personal
liability or which is contrary to any Loan Document or applicable law. Neither
the Administrative Bank nor the Collateral Agent shall have any implied duties
or any obligation to take any action under this Agreement or any other Loan
Document except such action as is specifically provided by this Agreement or any
other Loan Document to be taken by the Administrative Bank or the Collateral
Agent. Each of the Administrative Bank and the Collateral Agent shall act as an
independent contractor in performing its obligations as the Administrative Bank
and the Collateral Agent hereunder and under the other Loan Documents and
nothing contained herein or therein shall be deemed to create a fiduciary
relationship among or between the Administrative Bank or the Collateral Agent,
as the case may be, and Borrower or among or between the Administrative Bank or
the Collateral Agent, as the case maybe, and any Lender.
VII.3. Employment of Counsel, etc.
Each of the Administrative Bank and the Collateral Agent may execute
any of its duties under this Agreement or any other Loan Document, and any
instrument, agreement or document executed, issued or delivered pursuant hereto
or in connection herewith, by or through employees, agents and attorneys-in-fact
and shall not be answerable to any Lender for the default or misconduct of any
such agent or attorney-in-fact selected by it with reasonable care. Each of the
Administrative Bank and the Collateral Agent shall be entitled to rely on advice
of counsel (including counsel who are the employees of the Administrative Bank
or the Collateral Agent, as the case may be) selected by the relevant Person
concerning all matters pertaining to the agency hereby created and its duties
under any of the Loan Documents.
VII.4. Reliance.
Each of the Administrative Bank and the Collateral Agent shall be
entitled to rely upon and shall not be under a duty to examine or pass upon the
validity, effectiveness or genuineness of any notice, consent, waiver,
amendment, certificate, affidavit, letter, telegram, statement, paper, document
or writing reasonably believed by it to be genuine and to have
60
been signed or sent by the proper person or persons, and such Person shall be
entitled to assume that the same are valid, effective and genuine and what they
purport to be.
VII.5. General Immunity.
Neither the Administrative Bank, the Collateral Agent nor any of such
Person's directors, officers, agents, attorneys or employees shall be liable to
any Lender for any action taken or omitted to be taken by it or them under the
Loan Documents or in connection therewith except that each such Person shall be
obligated on the terms set forth herein for performance of its express
obligations hereunder and except that no Person shall be relieved of any
liability imposed by law for intentional tort, gross negligence or willful
misconduct. Without limiting the generality of the foregoing, neither the
Administrative Bank nor the Collateral Agent: (a) shall be responsible to any
Lender for any recitals, statements, warranties or representations under the
Loan Documents or any agreement or document relative thereto or for the
financial condition of Borrower; (b) shall be responsible for the authenticity,
accuracy, completeness, value, validity, effectiveness, due execution, legality,
genuineness, enforceability or sufficiency of any of the Loan Documents; (c)
shall be responsible for the validity, genuineness, creation, perfection or
priority of any of the Liens created by any of the Loan Documents, or the
validity, genuineness, enforceability, existence, value or sufficiency of the
Project or other security; (d) shall be bound to ascertain or inquire as to the
performance or observance of any of the terms, covenants or conditions of any of
the Loan Documents on the part of Borrower or of any of the terms of any such
agreement by any party thereto and shall have no duty to inspect the property
(including the books and records) of Borrower; (e) shall incur any liability
under or in respect of any of the Loan Documents or any other document or the
Project by acting upon any notice, consent, certificate or other instrument or
writing (which may be by telegram, cable or telex) reasonably believed by the
Administrative Bank to be genuine and signed or sent by the proper party; and
(f) may consult with legal counsel (including counsel for Borrower), independent
public accountants and other experts selected by such Person and shall not be
liable for any action taken or omitted to be taken in accordance with the advice
of such counsel, accountants or experts.
VII.6. Credit Analysis.
Each Lender has made, and shall continue to make, its own independent
investigation or evaluation of the operations, business, property and condition,
financial and otherwise, of Borrower and Lessee in connection with the making of
its commitments hereunder and has made, and will continue to make, its own
independent appraisal of the creditworthiness of Borrower and Lessee. Without
limiting the generality of the foregoing, each Lender acknowledges that prior to
the execution of this Agreement, it had this Agreement and all other Loan
Documents and such other documents or matters as it deemed appropriate relating
thereto reviewed by its own legal counsel as it deemed appropriate, and it is
satisfied with the form of this Agreement and all other Loan Documents. Each
Lender agrees and acknowledges that none the Administrative Bank, the Collateral
Agent or any of their respective directors, officers, attorneys or employees
makes any representations or warranties
61
about the creditworthiness of Borrower or with respect to the due execution,
legality, validity, genuineness, effectiveness, sufficiency or enforceability of
this Agreement or any other Loan Documents, or the validity, genuineness,
execution, perfection or priority of liens created or reaffirmed by any of the
Loan Documents, or the validity, genuineness, enforceability, existence, value
or sufficiency of any Collateral or other security. Except as explicitly
provided herein, none of the Administrative Bank, the Collateral Agent or any
Lender has any duty or responsibility, either initially or on a continuing
basis, to provide any other Lender with any credit or other information with
respect to the operations, business, property, condition or creditworthiness of
Borrower or any Lessee, whether such information comes into its possession on or
before a Default or an Event of Default or at any time thereafter.
VII.7. US Bank and Affiliates.
If US Bank is a "Lender" party hereto, then, with respect to its
Commitment, the Advances made by it, and the Note issued to it, US Bank shall
have the same rights and powers under the Loan Documents as any other Lender and
may exercise the same as though it were not the Administrative Bank and/or the
Collateral Agent; and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated, include US Bank in its individual capacity. US Bank and its
Affiliates reserve the right to: (a) accept deposits from Borrower or any
Affiliate of the Borrower, including Lessee; (b) make other or additional loans
or otherwise extend credit to any such Person; (c) act as trustee under
indentures of any such Person; (d) generally engage in any kind of banking
business with any such Person; (e) act as financial advisor to or placement
agent for any debt or equity securities of any such Person; and (f) do any of
the foregoing with any person or entity who may do business with or own
securities of Borrower or any Affiliate of Borrower; provided, however, that
nothing in this Section authorizes Borrower, US Bank or any Affiliate of US Bank
to engage in any transaction which is prohibited, limited or restricted by this
Agreement or any other Loan Document.
VII.8 Indemnification.
Lenders severally agree to indemnify and hold harmless the
Administrative Bank, the Collateral Agent and their respective officers,
directors, employees and agents (to the extent not reimbursed by Borrower)
ratably, according to their respective Indemnification Percentages, from and
against any and all claims, liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against the Administrative Bank, the Collateral Agent or any of their respective
officers, directors, employees or agents, in any way relating to or arising out
of any investigation, litigation or proceeding concerning or relating to the
transaction contemplated by this Agreement or any of the other Loan Documents,
or any of them, or any action taken or omitted to be taken by such Person under
any of the Loan Documents, provided, however, that no Lender shall be liable for
any portion of such claims, liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the intentional tort, gross negligence or willful misconduct of the
Administrative Bank or the Collateral Agent, as the case may be, or
62
any of such Person's officers, directors, employees or agents. Without
limitation of the foregoing, each Lender agrees to reimburse the Administrative
Bank and the Collateral Agent promptly upon demand for such Lender's
Indemnification Percentage of any out-of-pocket expenses (including counsel
fees) incurred by the Administrative Bank or the Collateral Agent, as the case
may be, or such Person's officers, directors, employees or agents in connection
with the preparation, execution, administration or enforcement of, or obtaining
legal advice in respect of rights or responsibilities under any of, the Loan
Documents, to the extent that such Person is not reimbursed for such expenses by
Borrower. If any indemnity furnished to the Administrative Bank or the
Collateral Agent for any purpose shall, in the opinion of such Person, be
insufficient or become impaired, such Person may call for additional indemnity
and not commence or cease to do the acts indemnified against until such
additional indemnity is furnished.
VII.9. Successor Administrative Bank; etc.
The Administrative Bank and/or the Collateral Agent may resign at any
time such capacity under the Loan Documents by giving not less than sixty (60)
days written notice thereof to Lenders and Borrower. Upon any such resignation,
the Super Majority Lenders shall have the right to appoint a successor
Administrative Bank and/or Collateral Agent hereunder with the consent of
Borrower which consent will not be unreasonably withheld, except that Borrower's
approval of any Lender as a successor Administrative Bank and/or Collateral
Agent is not required. For thirty (30) days after the giving of such notice by
the retiring Person, the other Lenders shall attempt to agree on a successor
Administrative Bank and/or Collateral Agent willing to so act. If no successor
Administrative Bank and/or Collateral Agent shall have been so appointed by the
Super Majority Lenders, and such appointed successor shall have accepted such
appointment, within 30 days after the retiring Administrative Bank's and/or the
Collateral Agent's giving of notice of resignation, then the retiring Person
shall, for a period of ten (10) days thereafter, attempt to obtain the consent
of a Lender to serve as successor; if the retiring Person is not able to obtain
such consent from any Lender within such ten (10) day period, the retiring
Person may, on behalf of Lenders, appoint a successor Administrative Bank with
the consent of Borrower which consent will not be unreasonably withheld, which
shall be a commercial bank organized under the laws of the United States or of
any State thereof and having a combined capital and surplus of at least
$300,000,000.00. Upon the acceptance of any appointment as the Administrative
Bank and/or the Collateral Agent under the Loan Documents by a successor Person,
such successor shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Administrative Bank and/or
Collateral Agent, and the retiring Administrative Bank and/or Collateral Agent
shall be discharged from its duties and obligations under the Loan Documents.
After any retiring Administrative Bank's and/or Collateral Agent's resignation
as Administrative Bank and/or Collateral Agent under the Loan Documents, the
provisions of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Bank and/or
Collateral Agent under the Loan Documents.
VII.10. Loans to Affiliates of Borrower
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Each Lender and its Affiliates reserve the right: (a) accept deposits
from Borrower or any Affiliate of the Borrower, including Lessee; (b) make other
or additional loans or otherwise extend credit to any such Person; (c) act as
trustee under indentures of any such Person; (d) generally engage in any kind of
banking business with any such Person; (e) act as financial advisor to or
placement agent for any debt or equity securities of any such Person; and (f) do
any of the foregoing with any person or entity who may do business with or own
securities of Borrower or any Affiliate of Borrower; provided, however, that
nothing in this Section authorizes Borrower, any Lender or any Affiliate of such
Lender to engage in any transaction which is prohibited, limited or restricted
by this Agreement or any other Loan Document. This Agreement does not apply to
any permitted credit, loan or other financial accommodation to Borrower or any
Affiliate of the Borrower not furnished or made under this Agreement or the Loan
Documents.
VIII. MISCELLANEOUS
VIII.1. Binding Effect; Waivers; Cumulative Rights and Remedies
The provisions of this Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs, executors,
administrators, personal representatives, legal representatives, successors and
assigns; provided, however, that neither this Agreement nor the proceeds of any
Series Loan may be assigned by Borrower voluntarily, by operation of law or
otherwise, without the prior written consent of the Administrative Bank and
Applicable Primary Lenders. No delay on the part of the Administrative Bank or
Lenders in exercising any right, remedy, power or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder constitute such a waiver or exhaust
the same, all of which shall be continuing. The rights and remedies of the
Administrative Bank, the Collateral Agent and Lenders specified in this
Agreement shall be in addition to, and not exclusive of, any other rights and
remedies which the Administrative Bank or Lenders would otherwise have at law,
in equity or by statute, and all such rights and remedies, together with the
Administrative Bank's, Lenders' and the Collateral Agent's respective rights and
remedies under the other Loan Documents, are cumulative and may be exercised
individually, concurrently, successively and in any order.
VIII.2. Survival
All agreements, representations and warranties made in this Agreement
shall survive the execution of this Agreement, the making of the Advances by
Lenders, and the execution of the other Loan Documents, and shall continue until
Lenders receive payment in full of all indebtedness of Borrower incurred under
this Agreement and under the other Loan Documents.
VIII.3. Governing Law; Waiver of Jury Trial, Jurisdiction
THIS AGREEMENT, THE RIGHTS OF THE PARTIES HEREUNDER AND THE
INTERPRETATION HEREOF SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF MINNESOTA, IN ALL
64
RESPECTS, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF, BUT
GIVING EFFECT TO FEDERAL LAWS OF THE UNITED STATES APPLICABLE TO NATIONAL BANKS.
BORROWER, EACH LENDER AND THE ADMINISTRATIVE BANK HEREBY WAIVE ANY RIGHT TO A
TRIAL BY JURY IN ANY ACTION RELATING TO ANY SERIES LOAN AND/OR THE LOAN
DOCUMENTS. AT THE OPTION OF THE ADMINISTRATIVE BANK, THIS AGREEMENT, THE NOTES
AND THE OTHER LOAN DOCUMENTS MAY BE ENFORCED IN ANY FEDERAL COURT OR MINNESOTA
STATE COURT SITTING IN MINNEAPOLIS OR ST. XXXX, MINNESOTA EXCEPT WITH RESPECT TO
FORECLOSURE AND RECEIVERSHIP PROCEEDINGS AGAINST ANY PROJECT OR ANY PORTION
THEREOF WHICH MAY BE COMMENCED IN ACCORDANCE WITH APPLICABLE LAW. BORROWER AND
EACH LENDER CONSENT TO THE JURISDICTION AND VENUE OF ANY SUCH COURT AND WAIVES
ANY ARGUMENT THAT VENUE IN SUCH FORUMS IS NOT CONVENIENT. IN THE EVENT AN ACTION
IS COMMENCED IN ANOTHER JURISDICTION OR VENUE UNDER ANY TORT OR CONTRACT THEORY
ARISING DIRECTLY OR INDIRECTLY FROM THE RELATIONSHIP CREATED BY THIS AGREEMENT,
THE ADMINISTRATIVE BANK, AT ITS OPTION, SHALL BE ENTITLED TO HAVE THE CASE
TRANSFERRED TO ONE OF THE JURISDICTIONS AND VENUES ABOVE DESCRIBED, OR IF SUCH
TRANSFER CANNOT BE ACCOMPLISHED UNDER APPLICABLE LAW, TO HAVE SUCH CASE
DISMISSED WITHOUT PREJUDICE, BUT ANY APPLICABLE STATUTE OF LIMITATION SHALL
CONTINUE TO BE TOLLED FOR A PERIOD OF SIX (6) MONTHS AFTER SUCH DISMISSAL.
VIII.4. Counterparts
This Agreement may be executed in any number of counterparts, all of
which shall constitute a single Agreement.
VIII.5. Notices
Any notice required or permitted to be given by either party hereto to
the other under the terms of this Agreement, or documents related hereto, shall
be deemed to have been given on the date the same is deposited in the United
States Mail, registered or certified, return receipt requested, postage prepaid,
or deposited with Federal Express, Airborne or another reputable overnight
courier, addressed to the party to which the notice is to be given at the
address set forth opposite its name below or with respect to any Lender, on
Schedule A attached to the Supplement to which such Lender is a party, or at any
other address specified in a notice given by such party to the other not less
than ten (10) days prior to the effective date of the address change.
VIII.6. Lenders' Sign
The Primary Lenders for the Applicable Series Loan and the
Administrative Bank may, if it so desires, place a sign of reasonable size on
the Land for the relevant Project, at Borrower's expense, indicating that the
Administrative Bank and such Primary Lenders are
65
providing financing for such Project, and/or may otherwise publicize its
involvement with such Project, including but not limited to issuing press
releases.
VIII.7. No Third Party Reliance
No third party, other than the Collateral Agent, shall be entitled to
rely upon this Agreement or to have any of the benefits of the Administrative
Bank's and Lender's interest hereunder, unless such third party is an express
assignee of all or a portion of the Administrative Bank's or a Lender's interest
hereunder. The Collateral Agent is a third-beneficiary of this Agreement.
VIII.8. Sale of Loan or Participations
Any Primary Lender, with the prior written consent of the Borrower and
the Administrative Bank (other than with respect to any of the transactions
described in the proviso clause hereto (an "Exempt Transfer")), may at any time,
sell, assign, transfer, syndicate, grant participations in or otherwise dispose
of (a "Transfer") any portion of such Primary Lender's Series Loan and in such
Primary Lender's Commitment therefor (each such interest so disposed of being
herein called a "Transferred Interest") to banks, insurance companies, other
financial institutions or investment funds (hereinafter called "Transferees"),
pursuant to such transfer agreements, participation agreements and/or agency
agreements into which such Primary Lender and its Transferees may enter;
provided, that no Borrower's or Administrative Bank's consent shall be required
with respect to any assignment made: (a) during any period following the
acceleration of the Loans after an Event of Default has occurred; (b) to an
Affiliate of such Primary Lender; (c) in connection with the sale of all or
substantially all of such Primary Lender's assets; or (d) in response to any
regulatory action affecting such Primary Lender. In addition, any Transfer,
other than a sale of a participation in a Primary Lender's portion of it Series
Loan, shall be subject to the following limitations:
(i) The Transferee shall pay to Administrative Bank a transfer fee
of $2,000.00 for any Transfer within five (5) business days
after such Transfer (including any Transfer to an affiliate of
a Lender); and
(ii) Any Transfer must be in an amount equal to not less than 50%
of such Primary Lender's Series Loan or, if such Series Loan
is not fully advanced, not less than 50% of such Primary
Lender's Individual Commitment for such Series Loan.
At the request of a transferring Primary Lender, in the event of any such sale,
assignment, transfer or syndication, Borrower shall execute separate new Note to
the Transferee, and shall deliver the same to the Transferee, in exchange for
such transferring Primary Lender's existing Note. Each such separate new Note
shall be entitled to all the rights and benefits accorded to the Note under the
terms of the Loan Documents.
The Administrative Bank and any Lender may divulge all information
received by it from Borrower or any other source, including but not limited to
information relating to the
66
Loans, to the Projects and to Borrower, to any such Transferee or prospective
Transferee, and Borrower shall cooperate with each Lender in satisfying the
requirements of any such prospective Transferee for consummating such a purchase
or participation.
If any Lender makes any assignment to a Transferee, such Lender shall
nevertheless remain liable for the performance of its duties and obligations
under this Agreement arising prior to the effective date of such assignment but
shall have no liability for the performance of its duties or obligations
following such effective date.
VIII.9. Time of the Essence
Time is of the essence hereof with respect to the dates, terms and
conditions of this Agreement.
VIII.10. Entire Agreement; No Oral Modifications
This Agreement, the other Loan Documents and the other documents
mentioned herein set forth the entire agreement of the parties with respect to
the Loan and supersede all prior written or oral understandings and agreements
with respect thereto. Except as otherwise provided herein, the provisions of
this Agreement and each other Loan Document may from time to time be amended,
modified, supplemented or waived, if such amendment, modification, supplement
waiver or consent is in writing and consented to by Borrower and the Super
Majority Lenders (in the case of amendments, modifications supplements, waivers
and consents) except that:
(a) the Administrative Bank's and all of the Lenders'
consent shall be required if the amendment, modification, supplement,
waiver or consent: (i) changes the amount of, or extends the maturity
of, any principal or any installment of principal payable under any
Note; (ii) changes the amount of, or extends the payment date for,
fees, interest or other non-principal payment due and payable under
this Agreement or any other Loan Document; (iii) releases any Project
or any material part hereof, if any, except as otherwise expressly
required by the terms of the Loan Documents; (iv) waives any Event of
Default of the nature described in Section VI.1.A. or B; (v) changes
the definition of "Maximum Loan Amount;"(v) adds any of the Borrower's
sports and health club facilities as an Approved Project; (vi) changes
this Section or the definition of "Super Majority Lenders"; (viii)
changes Section I.10., I.11. or I.12. or any provision of any other
Loan Document which allocates payments on the Obligations among the
Administrative Bank, the Collateral Agent and the Lenders; or (ix)
causes any Approved Project, other than the Columbus Project, not to
constitute Collateral or Additional Project Collateral for all of the
Series Loans;
(b) in addition to the consents required by subsection
(a) above, the Administrative Bank's consent shall be required if the
amendment, modification, supplement waiver or consent affects the
rights or obligations of the Administrative Bank; and
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(c) in addition to the consents required by subsections
(a) or (b) above, the Collateral Agent's consent shall be required if
the amendment, modification, supplement waiver or consent affects the
rights or obligations of the Collateral Agent.
No amendment, modification, supplement, waiver or consent of any provision of
this Agreement or consent to any departure by Borrower therefrom shall be
effective unless the same shall be in writing and signed by the parties required
by this Section to take the relevant action, and then such amendment,
modification, supplement, waiver or consent shall be effective only in the
specific instances and for the specific purpose for which given.
VIII.11. Captions
The headings or captions of the Articles and Sections set forth herein
are for convenience only, are not a part of this Agreement and are not to be
considered in interpreting this Agreement.
VIII.12. Borrower-Lender Relationship
The relationship between Borrower and Lenders created hereby and by the
other Loan Documents shall be that of a borrower and a lender only, and in no
event shall any Lender be deemed to be a partner of, or a joint venturer with,
Borrower.
VIII.13. Fees and Expenses.
Borrower agrees, whether or not the transaction hereby contemplated is
consummated, to pay the fees and expenses and disbursements of the Inspecting
Architect for each Project, the Administrative Bank's and the Collateral Agent's
special legal counsel, Messrs. Fabyanske, Xxxxxx & Xxxx, P.A., Minneapolis,
Minnesota, and each Lenders' counsel and all of the Administrative Bank's, the
Collateral Agent's and each Lender's respective out-of-pocket expenses,
including recording fees, mortgage registration taxes, and all title insurance
charges, including abstracting charges, commitment fees and premiums incurred in
connection with the transaction which is the subject of this Agreement; provided
that Borrower's obligations to pay and reimburse any Primary Lender for its
reasonable attorneys' fees incurred in connection with the preparation and
review of the Loan Documents and the closing of its Series Loan shall be limited
to the amount specified in the Supplement for such Series Loan. Borrower agrees
to pay all reasonable expenses for the preparation of any amendments to the Loan
Documents and the consideration of legal questions relevant thereto (including
attorneys' fees and legal expenses of the Administrative Bank, the Collateral
Agent and each Lender); provided that Borrower's obligations to pay and
reimburse any Primary Lender for its reasonable attorneys' fees incurred in
connection with the preparation and review of such amendments shall be limited
to the amount specified in the Supplement for such Series Loan. Borrower agrees
to reimburse the Administrative Bank, the Collateral Agent and each Lender upon
demand for all reasonable out-of-pocket expenses (including attorneys' fees and
legal expenses) in connection with the Administrative Bank's, the Collateral
Agent's or such Lender's enforcement of the obligations of Borrower hereunder or
under the Notes or any other Loan Documents, whether
68
or not suit is commenced including, without limitation, attorneys' fees and
legal expenses in connection with any appeal of a lower court's order or
judgment. The obligations of Borrower under this Section shall survive any
termination of this Agreement.
VIII.14. Survival of Representations and Warranties.
All representations and warranties contained herein or made in writing
by or on behalf of Borrower in connection with the transactions contemplated
hereby shall survive the execution and delivery of this Agreement and the
Advances hereunder. All statements contained in any certificate or other
instrument delivered by or on behalf of Borrower pursuant thereto or in
connection with the transactions contemplated hereby shall constitute
representations and warranties by Borrower.
VIII.15. Indemnification.
In consideration of the execution and delivery of this Agreement by
Lenders, Borrower hereby agrees to indemnify, exonerate and hold the
Administrative Bank, the Collateral Agent, each Lender and their respective
officers, directors, employees and agents (the "Indemnified Parties") free and
harmless from and against any and all actions, causes of action, suits, losses,
liabilities and damages, and expenses in connection therewith including, without
limitation, reasonable attorneys' fees and disbursements (the "Indemnified
Liabilities"), imposed upon, incurred by or asserted against any Indemnified
Party by any Person which is not a party to a Loan Document, whether direct,
indirect or consequential, and whether based on any federal, state, local or
foreign laws or regulations (including, without limitation, securities laws,
commercial laws and regulations, under common law, or on equitable cause or on
contract or otherwise), as a result of, or arising out of, or relating to:
a. any transaction financed or to be financed in whole or in part
directly or indirectly with proceeds of Advances under this
Agreement; or
b. the execution, delivery, performance or enforcement of this
Agreement or any other Loan Documents or any document executed
pursuant hereto by any of the Indemnified Parties;
c. any inaccuracy in any material respect, or any untrue
statement or alleged untrue statement of any material fact,
made in any Loan Document or any amendment or supplement
thereto or in any other report, exhibit or publication in
connection therewith, or by reason of the omission or alleged
omission to state therein a material fact necessary to make
such statements, in the light of the circumstances under which
they were made, not misleading; or
d. any investigation, litigation, proceeding or other action
relating to any Loan Document (whether or not any Indemnified
Party is a party thereto);
except for any such Indemnified Liabilities arising on account of any
Indemnified Party's gross negligence or willful misconduct. If and to the extent
that the foregoing undertaking
69
may be unenforceable for any reason, Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law. The provisions of this
Section shall survive termination of this Agreement and any other Loan Document.
VIII.16. Antares Capital Corporation.
The Administrative Bank, the Collateral Agent and Lenders agree that
Borrower may enter into a Landlord Consent and Estoppel in favor of Antares
Capital Corporation, f/k/a Antares Leveraged Capital Corp. ("Antares") in the
form previously approved by the U.S. Bank in connection with the closing of the
Lessee's credit facility with Antares and further agrees that the Collateral
Agent may enter into a Mortgagee and Leasehold Mortgage Agreement with Antares
in the form of the Amended and Restated Mortgagee and Leasehold Mortgagee
Agreement dated as of March 3, 1999.
VIII.17. Supplements.
In connection with obtaining a new Series Loan to finance the
construction of an Approved Project, Borrower, the Administrative Bank and the
Primary Lenders for such Series Loan shall enter into a Supplement hereto which
shall specify the terms of such Series Loan; provided, however, that the terms
of such Supplement may amend, modify or supplement the terms of this Agreement
solely as applied to such new Series Loan.
VIII.18. Effect on Original Master Agreement.
On and after the Effective Date: (a) the Original Master Agreement
shall be deemed to be amended and restated by the terms of this Agreement as
supplemented, for the Series A through E Loans, by the applicable Supplement for
such Series Loans, which Supplements shall survive the Effective Date and shall
be deemed to a part of this Agreement; (b) each of the Series A through E Loans
shall be subject to the provisions of this Agreement as so supplemented; and (c)
each reference in any Loan Document to the Original Master Agreement,
"thereunder," "thereof', "therein" or words of like import referring to the
Original Master Agreement in any other Loan Document shall mean and be a
reference to the Original Master Agreement as amended and restated hereby.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
BORROWER:
FCA REAL ESTATE HOLDINGS, LLC
By: LIFE TIME FITNESS, Inc.
Its: Manager
By: ____________________________________
Its: Secretary and Chief Financial Officer
Address:
0000 Xxxx Xxxx Xxxxxxx
Xxxxx 000
Xxxx Xxxxxxx, XX 00000
Attention: Xx. Xxxxx X. Xxxxxx
ADMINISTRATIVE BANK:
U.S. BANK NATIONAL ASSOCIATION, as the
Administrative Bank, the Collateral Agent
and the sole Primary Lender for the
Series A through C Loans
By:____________________________________
Its: Vice President
Address: 0000 Xxxxxx Xxxxxx
Xxxxx Xxxxx XX 00000
Attention: Xx. Xxxxx X. Xxxxxxxx
BANK ONE, MICHIGAN, as the sole Primary
Lender for the Series D and E Loans
By: ___________________________________
Its: Vice President
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EXHIBIT A
COMPLIANCE CERTIFICATE
Pursuant to Section V.7.H of the Amended and Restated Master
Construction and Term Loan Agreement dated as of July 17, 2000 (the Amended and
Restated Master Construction and Term Loan Agreement as it may be amended,
modified, supplemented or restated from time to time being the "Loan Agreement";
the terms defined therein being used herein as therein defined) by and between
the undersigned, U.S. Bank National Association in its capacity as the
Administrative Bank (in such capacity, the "Administrative Bank"), the
Collateral Agent and the "Lenders" parties thereto, the undersigned certifies to
the Administrative Bank, and the Lenders as follows:
1. The financial statements of the Borrower attached hereto for
the period ending ____________________, 200__ (the "Financial Statements") have
been prepared in accordance with GAAP applied on a consistent basis subject only
to year-end adjustments which in the aggregate are not expected to be materially
adverse and the omission of footnotes.
2. The representations and warranties contained in Article IV of
the Loan Agreement are true and correct as of the date hereof as though made on
that date except that the representations and warranties set forth in Section
IV.5. to the financial statements of the Borrower or Lessee shall be deemed a
reference to the audited and unaudited financial statements of the Borrower or
Lessee, as the case may be, then most recently delivered to the Administrative
Bank and such Series F Lenders pursuant to Section V.7. of the Loan Agreement.
3. As of _____________________, 200__, (the "Measurement Date")
no Default or Event of Default has occurred and is continuing [except (describe
here any Default or Event of Default and the action which the undersigned
proposes to take with respect thereto.)].
4. Section V.28. During the fiscal quarter ending on such
Measurement Date:
(a) the undersigned was required to have received the
aggregate monthly cash payments of Base Rent on the Project Leases for
the completed Projects described in the table below and the undersigned
actually received the amount on such Project Lease set forth in such
table:
Required Actual
Project Lease Base Rent Base Rent
------------- --------- ---------
Bloomington $ 57,702.00 $____________
Xxxxx $ 90,669.00 $____________
Woodbury $102,444.00 $____________
Xxxx $__________ $____________
Columbus $__________ $____________
Indianapolis $__________ $____________
Novi $__________ $____________
[add Projects as they are completed]
(b) The undersigned made the following payment of
Rebatble Rent with respect to the Project Lease:
Rebatable Operating Tax Rebatable
Project Rent Per Lease Expenses Distributions Rent
------- -------------- ------------ ------------- ------------
Bloomington $_____________ ($_________) ($__________) ($_________)
Xxxxx $_____________ ($_________) ($__________) ($_________)
Woodbury $_____________ ($_________) ($__________) ($_________)
Xxxx $_____________ ($_________) ($__________) ($_________)
Columbus $_____________ ($_________) ($__________) ($_________)
Indianapolis $_____________ ($_________) ($__________) ($_________)
Novi $_____________ ($_________) ($__________) ($_________)
[add Projects as they are completed]
5. Section V.29. During the fiscal quarter ending on such
Measurement Date, the undersigned paid Tax Distributions with respect to the
Project for the undersigned's current tax year or previous tax year as set forth
in the following table:
Current Previous
Project Year Tax Year
------- ----------- ------------
Bloomington $__________ ($_________)
Xxxxx $__________ ($_________)
Woodbury $__________ ($_________)
Xxxx $__________ ($_________)
Columbus $__________ ($_________)
Indianapolis $__________ ($_________)
Novi $__________ ($_________)
[add Projects as they are completed]
Dated _____________, _________ FCA REAL ESTATE HOLDINGS, LLC
By: LIFE TIME FITNESS, Inc.
Its: Manager
By:_____________________________
Its: ___________________________
