TERM LOAN AGREEMENT
AMONG
CHELSEA GCA REALTY PARTNERSHIP, L.P.,
A DELAWARE LIMITED PARTNERSHIP,
AS BORROWER,
AND
BANKBOSTON, N.A.
NATIONSBANK, N.A., SYNDICATION AGENT,
COMMERZBANK AG,
KEYBANK NATIONAL ASSOCIATION,
PNC BANK,
TOGETHER WITH THOSE ASSIGNEES
BECOMING PARTIES HERETO PURSUANT
TO SECTION 11.12, AS LENDERS,
AND
BANKBOSTON, N.A.
AS AGENT
Dated as of November 3, 1998
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS....................................................1
1.1 CERTAIN DEFINED TERMS.......................................1
1.2 COMPUTATION OF TIME PERIODS................................22
1.3 TERMS......................................................22
ARTICLE II LOANS........................................................23
2.1 ADVANCE AND REPAYMENT OF LOANS.............................23
2.2 AUTHORIZATION TO SELECT INTEREST RATE OPTIONS..............25
2.3 LENDERS' ACCOUNTING........................................25
2.4 INTEREST ON THE LOANS......................................25
2.5 FEES.......................................................29
2.6 PAYMENTS...................................................30
2.7 INCREASED CAPITAL..........................................30
2.8 NOTICE OF INCREASED COSTS..................................31
ARTICLE III UNENCUMBERED PROPERTIES AND PORTFOLIO PROPERTIES............31
3.1. LISTING OF UNENCUMBERED PROPERTIES.........................31
3.2. WAIVERS BY REQUISITE LENDERS...............................31
3.3. REJECTION OF UNENCUMBERED PROPERTIES.......................31
3.4 UPDATED LISTS OF UNENCUMBERED PROPERTIES AND PORTFOLIO
PROPERTIES.................................................32
ARTICLE IV CONDITIONS TO LOANS..........................................32
4.1 CONDITIONS TO DISBURSEMENT OF LOANS........................32
ARTICLE V REPRESENTATIONS AND WARRANTIES................................34
5.1 BORROWER ORGANIZATION; PARTNERSHIP POWERS..................34
5.2 BORROWER AUTHORITY.........................................34
5.3 REIT ORGANIZATION; CORPORATE POWERS........................34
5.4 REIT AUTHORITY.............................................34
5.5 OWNERSHIP OF BORROWER, EACH SUBSIDIARY AND PARTNERSHIP.....35
5.6 NO CONFLICT................................................35
5.7 CONSENTS AND AUTHORIZATIONS................................35
5.8 GOVERNMENTAL REGULATION....................................35
5.9 PRIOR FINANCIALS...........................................35
5.10 PROJECTIONS AND FORECASTS..................................36
5.11 PRIOR OPERATING STATEMENTS.................................36
5.12 RENT ROLLS.................................................36
5.13 LITIGATION; ADVERSE EFFECTS................................36
5.14 NO MATERIAL ADVERSE CHANGE.................................36
5.15 PAYMENT OF TAXES...........................................37
5.16 MATERIAL ADVERSE AGREEMENTS................................37
5.17 PERFORMANCE................................................37
5.18 FEDERAL RESERVE REGULATIONS................................37
5.19 UNSECURED TERM NOTES.......................................37
5.20 REQUIREMENTS OF LAW........................................37
5.21 PATENTS, TRADEMARKS, PERMITS, ETC..........................38
5.22 ENVIRONMENTAL MATTERS......................................38
5.23 UNENCUMBERED PROPERTIES....................................38
5.24 SOLVENCY...................................................38
5.25 TITLE TO ASSETS; NO LIENS..................................38
5.26 USE OF PROCEEDS............................................38
5.27 REIT CAPITALIZATION........................................39
5.28 ERISA......................................................39
5.29 STATUS AS A REIT...........................................39
5.30 OWNERSHIP..................................................39
5.31 NYSE LISTING...............................................39
5.32 CURRENT CONSTRUCTION PROJECTS..............................39
5.33 YEAR 2000 COMPLIANCE.......................................39
ARTICLE VI REPORTING COVENANTS..........................................40
6.1 FINANCIAL STATEMENTS AND OTHER FINANCIAL AND OPERATING
INFORMATION................................................40
6.2 ENVIRONMENTAL NOTICES......................................44
6.3 CONFIDENTIALITY............................................45
ARTICLE VII AFFIRMATIVE COVENANTS........................................45
7.1 EXISTENCE..................................................45
7.2 QUALIFICATION, NAME........................................45
7.3 COMPLIANCE WITH LAWS, ETC..................................45
7.4 PAYMENT OF TAXES AND CLAIMS................................45
7.5 MAINTENANCE OF PROPERTIES; INSURANCE.......................46
7.6 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS.....46
7.7 MAINTENANCE OF PERMITS, ETC................................46
7.8 CONDUCT OF BUSINESS........................................47
7.9 USE OF PROCEEDS............................................47
7.10 SECURITIES LAW COMPLIANCE..................................47
7.11 CONTINUED STATUS AS A REIT; PROHIBITED TRANSACTIONS........47
7.12 NYSE LISTED COMPANY........................................47
7.13 PROPERTY MANAGEMENT........................................47
7.14 INTEREST RATE CONTRACTS....................................47
ARTICLE VIII NEGATIVE COVENANTS.........................................48
8.1 LIENS......................................................48
8.2 TRANSFERS OF WOODBURY COMMON...............................48
8.3 RESTRICTIONS ON FUNDAMENTAL CHANGES........................48
8.4 ERISA......................................................48
8.5 AMENDMENT OF CONSTITUENT DOCUMENTS.........................49
8.6 DISPOSAL OF PARTNERSHIP INTERESTS OR STOCK IN SUBSIDIARIES.49
8.7 MARGIN REGULATIONS.........................................49
8.8 WITH RESPECT TO THE REIT...................................50
8.9 ADDITIONAL UNSECURED BANK DEBT.............................50
8.10 RESTRICTIONS ON INDEBTEDNESS...............................50
8.11 CONSTRUCTION PROJECTS......................................52
8.12 DISCONTINUITY IN MANAGEMENT................................52
ARTICLE IX FINANCIAL COVENANTS..........................................52
9.1 VALUE OF ALL UNENCUMBERED PROPERTIES.......................53
9.2 MINIMUM DEBT SERVICE COVERAGE .............................53
9.3 MINIMUM FAIR MARKET NET WORTH .............................53
9.4 TOTAL LIABILITIES TO ADJUSTED ASSET VALUE RATIO............53
9.5 MAXIMUM SECURED BORROWER DEBT..............................53
9.6 OPERATING CASH FLOW TO DEBT SERVICE RATIO..................53
9.7 EBITDA TO FIXED CHARGES RATIO..............................53
9.8 AGGREGATE OCCUPANCY RATE...................................53
9.9 DISTRIBUTIONS..............................................53
9.10 PERMITTED INVESTMENTS......................................54
9.11 CIP BUDGET AMOUNT TO ADJUSTED ASSET VALUE..................54
9.12 CALCULATION................................................54
ARTICLE X EVENTS OF DEFAULT; RIGHTS AND REMEDIES........................55
10.1 EVENTS OF DEFAULT..........................................55
10.2 RIGHTS AND REMEDIES........................................58
10.3 RESCISSION.................................................59
ARTICLE XI AGENCY PROVISIONS............................................59
11.1 APPOINTMENT................................................59
11.2 NATURE OF DUTIES...........................................59
11.3 LOAN DISBURSEMENT..........................................60
11.4 DISTRIBUTION AND APPORTIONMENT OF PAYMENTS.................61
11.5 RIGHTS, EXCULPATION, ETC...................................61
11.6 RELIANCE...................................................62
11.7 INDEMNIFICATION............................................62
11.8 AGENT INDIVIDUALLY.........................................62
11.9 SUCCESSOR AGENT; RESIGNATION OF AGENT; REMOVAL OF AGENT....63
11.10 CONSENT AND APPROVALS......................................63
11.11 AGENCY PROVISIONS RELATING TO CERTAIN ENFORCEMENT ACTIONS..65
11.12 ASSIGNMENTS AND PARTICIPATIONS.............................65
11.13 RATABLE SHARING............................................68
11.14 DELIVERY OF DOCUMENTS......................................69
11.15 NOTICE OF EVENTS OF DEFAULT................................69
ARTICLE XII MISCELLANEOUS...............................................69
12.1 EXPENSES...................................................69
12.2 INDEMNITY..................................................70
12.3 CHANGE IN ACCOUNTING PRINCIPLES............................71
12.4 AMENDMENTS AND WAIVERS.....................................71
12.5 INDEPENDENCE OF COVENANTS..................................72
12.6 NOTICES AND DELIVERY.......................................72
12.7 SURVIVAL OF WARRANTIES, INDEMNITIES AND AGREEMENTS.........73
12.8 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE......73
12.9 PAYMENTS SET ASIDE.........................................73
12.10 SEVERABILITY...............................................73
12.11 HEADING....................................................74
12.12 GOVERNING LAW..............................................74
12.13 LIMITATION OF LIABILITY....................................74
12.14 SUCCESSORS AND ASSIGNS.....................................74
12.15 CONSENT TO JURISDICTION AND SERVICE OF PROCESS; WAIVER OF
JURY TRIAL AND CERTAIN DAMAGE CLAIMS.......................74
12.16 COUNTERPARTS; EFFECTIVENESS; INCONSISTENCIES...............75
12.17 CONSTRUCTION...............................................75
12.18 OBLIGATIONS UNSECURED......................................75
12.19 ENTIRE AGREEMENT...........................................76
LIST OF EXHIBITS AND SCHEDULES
Exhibits:
A - Form of Assignment and Assumption
B - Form of Compliance Certificate
C - Form of Loan Notes
D - Form of Notice of Interest Rate Selection
E - Form of Fixed Rate Notice
Schedules:
1 - List of Unencumbered Properties
1.1 - List of Portfolio Properties which are not
Unencumbered Properties
5.5 - Partnerships and Subsidiaries
5.22 - Environmental Matters
5.32 - Current Construction Projects
TERM LOAN AGREEMENT
THIS TERM LOAN AGREEMENT is dated as of November 3, 1998 and is among
CHELSEA GCA REALTY PARTNERSHIP, L.P., a Delaware limited partnership
("Borrower"), each of the Lenders, as hereinafter defined, and BANKBOSTON, N.A.
a national banking association ("BankBoston") in its capacity as agent and as a
Lender.
RECITALS
A. The Borrower is the borrower under certain credit facilities (each
having BankBoston as lender or as agent for the lenders) which closed on March
30, 1998 consisting of (i) an unsecured revolving credit facility in the amount
of up to $160,000,000 (the "REVOLVING FACILITY") and (ii) an unsecured term loan
in the amount of $5,034,536.
B. On October 23, 1998 Borrower used the proceeds of a borrowing under
the Revolving Facility to redeem Borrower's Remarketed Floating Rate Reset Notes
due 2001 in the aggregate principal amount of $60,000,000.
C. Borrower has requested that such borrowing under the Revolving
Facility be refinanced with the unsecured term loan provided for herein (the
"FACILITY"), and the Lenders are willing to provide the requested Facility on
the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 CERTAIN DEFINED TERMS. The following terms used in this Agreement
shall have the following meanings (such meanings to be applicable, except to the
extent otherwise indicated in a definition of a particular term, both to the
singular and the plural forms of the terms defined):
"ACCOMMODATION OBLIGATIONS", as applied to any Person, means any
Indebtedness or other contractual obligation or liability, contingent or
otherwise, of another Person in respect of which that Person is liable,
including, without limitation, any such Indebtedness, obligation or liability
directly or indirectly guaranteed, endorsed (otherwise than for collection or
deposit in the ordinary course of business), co-made or discounted or sold with
recourse by that Person, or in respect of which that Person is otherwise
directly or indirectly liable, including in respect of any Partnership in which
that Person is a general partner, Contractual Obligations (contingent or
otherwise) arising through any agreement to purchase, repurchase or otherwise
acquire such Indebtedness, obligation or liability or any security therefor, or
to provide funds for the payment or discharge thereof (whether in the form of
loans, advances, stock purchases, capital contributions or otherwise), or to
maintain solvency, assets, level of income, or other financial condition, or to
make payment other than for value received.
"ACCOUNTANTS" means Ernst & Young LLP, any other "big five" accounting
firm or another firm of certified public accountants of national standing
selected by Borrower and acceptable to Agent.
"ACQUISITION PRICE" means the aggregate purchase price for an asset
including bona fide purchase money financing provided by the seller and all (or
Borrower's Share of, as applicable) existing Indebtedness pertaining to such
asset.
"ADJUSTED ASSET VALUE" means, as at any date of determination, the sum
(without duplication of any item) of (i) cash and Cash Equivalents owned by
Borrower (excluding any tenant deposits), (ii) the outstanding principal balance
of the notes receivable reflected on the Prior Financials and such other notes
receivable hereafter owned by Borrower as may be approved by the Requisite
Lenders, (iii) an amount equal to (A) Operating Cash Flow for the most recently
ended Fiscal Quarter (as adjusted by Borrower to take into account any
acquisitions or dispositions of Properties owned by Borrower or any of its
Subsidiaries which adjustments must be approved by the Agent in its reasonable
discretion), TIMES (B) four (4), DIVIDED BY (C) 0.095, and (iv) an amount equal
to the lesser of (A) the aggregate Simon Partnership Values of all of the Simon
Partnerships or (B) fifteen percent (15%) of the sum of items (i), (ii) and
(iii) of this definition of Adjusted Asset Value.
"AFFILIATES" as applied to any Person, means any other Person directly
or indirectly controlling, controlled by, or under common control with, that
Person. For purposes of this definition, "control" (including, with correlative
meanings, the terms "controlling", "controlled by" and "under common control
with"), as applied to any Person, means (i) the possession, directly or
indirectly, of the power to vote twenty-five percent (25%) or more of the
Securities having voting power for the election of directors of such Person or
otherwise to direct or cause the direction of the management and policies of
that Person, whether through the ownership of voting securities or by contract
or otherwise, or (ii) the ownership of a general partnership interest or a
limited partnership interest (or other ownership interest) representing
twenty-five percent (25%) or more of the outstanding limited partnership
interests or other ownership interests of such Person. In addition, any
corporation, partnership or other entity in which the ownership interests of
Borrower and its Subsidiaries represents ten percent(10%) or more of the
outstanding ownership interests shall be deemed to be an Affiliate of Borrower.
"AGENT" means BankBoston in its capacity as agent for the Lenders
under this Agreement, and shall include any successor Agent appointed pursuant
hereto and shall be deemed to refer to BankBoston in its individual capacity as
a Lender where the context so requires.
"AGGREGATE OCCUPANCY RATE" means, with respect to the Unencumbered
Properties at any time, the ratio, as of such date of determination, expressed
as a percentage, of (i) the gross leasable area of all Unencumbered Properties
occupied by tenants paying rent pursuant to Leases other than Materially
Defaulted Leases, to (ii) the aggregate gross leasable area of all Unencumbered
Properties, excluding from both (i) and (ii) the gross leasable area of
Construction Projects prior to the date which is 3 months after the Rent
Stabilization Date for such Construction Project. Only premises which are
actually open for business shall be counted as occupied.
"AGREEMENT" means this Term Loan Agreement as the same may be amended,
supplemented or modified from time to time.
"APPLICABLE LIBOR RATE MARGIN" means, as of any date of determination,
1.40%.
"ASSIGNMENT AND ASSUMPTION" means an Assignment and Assumption in the
form of EXHIBIT A hereto (with blanks appropriately filled in) delivered to
Agent in connection with each assignment of a Lender's interest under this
Agreement pursuant to SECTION 11.12.
"ATC PARTNERSHIP" means Cannery Row Associates, a California limited
partnership in which the Borrower is the sole limited partner (having a 99%
interest) and the REIT is the sole general partner (having a 1% interest).
"BANKBOSTON TERM LOAN" means the term loan from BankBoston to Borrower
in the principal amount of $5,034,536 pursuant to a Term Loan Agreement dated
March 30, 1998 and any replacements, extensions or refinancing thereof.
"BASE RATE" means, on any day, the higher of (i) the base rate of
interest per annum established from time to time by BankBoston at its principal
office in Boston, Massachusetts, and designated as its "base rate" as in effect
on such day, or (ii) the Federal Funds Rate in effect on such day PLUS one-half
percent (0.5%) per annum.
"BASE RATE LOANS" means those Loans bearing interest at the Base Rate.
"BENEFIT PLAN" means any employee pension benefit plan as defined in
Section 3(2) of ERISA (other than a Multiemployer Plan) in respect of which a
Person or an ERISA Affiliate is, or within the immediately preceding five (5)
years was, an "employer" as defined in Section 3(5) of ERISA.
"BORROWER DEBT" means (without duplication) all Indebtedness of
Borrower or any Subsidiary of Borrower, without offset or reduction in respect
of prepaid interest, restructuring fees or similar items MINUS, in the case of
Nonrecourse Indebtedness of a Partnership that is otherwise included in
Indebtedness of Borrower, the amount of such Indebtedness in excess of
Borrower's Share thereof, provided, however, Borrower Debt shall not include
Indebtedness consisting of an Accommodation Obligation with respect to the
Indebtedness of a Simon Partnership.
"BORROWER'S SHARE" means, in the case of a Partnership or a Simon
Partnership, Borrower's percentage ownership interest in such Partnership or
such Simon Partnership. "BUSINESS DAY" means (i) with respect to any payment or
rate determination of LIBOR Loans, a day, other than a Saturday or Sunday, on
which Agent is open for business at its head office and on which dealings in
Dollars are carried on in the London interbank market, and (ii) for all other
purposes any day excluding Saturday, Sunday and any day which is a legal holiday
under the laws of the Commonwealth of Massachusetts, or is a day on which
banking institutions located in Massachusetts are required or authorized by law
or other governmental action to close.
"CAPITAL LEASES", as applied to any Person, means any lease of any
property (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
"CASH EQUIVALENTS" means (i) marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by an
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one (1) year after the date of acquisition thereof;
(ii) marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within ninety (90) days after the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from any two of Standard & Poor's Corporation,
Xxxxx'x Investors Services, Inc., Duff and Xxxxxx, or Fitch Investors (or, if at
any time no two of the foregoing shall be rating such obligations, then from
such other nationally recognized rating services as may be acceptable to Agent)
and not listed for possible down-grade in Credit Watch published by Standard &
Poor's Corporation; (iii) commercial paper, other than commercial paper issued
by Borrower or any of its Affiliates, maturing no more than ninety (90) days
after the date of creation thereof and, at the time of acquisition, having a
rating of at least A-1 or P-1 from either Standard & Poor's Corporation or
Moody's Investor's Service, Inc. (or, if at any time neither Standard & Poor's
Corporation nor Moody's Investor's Service, Inc. shall be rating such
obligations, then the highest rating from such other nationally recognized
rating services as may be acceptable to Agent); (iv) domestic and Eurodollar
certificates of deposit or time deposits or bankers' acceptances maturing within
ninety (90) days after the date of acquisition thereof, overnight securities
repurchase agreements, or reverse repurchase agreements secured by any of the
foregoing types of securities or debt instruments issued, in each case, by (A)
any commercial bank organized under the laws of the United States of America or
any state thereof or the District of Columbia having combined capital and
surplus of not less than Two Hundred Fifty Million Dollars ($250,000,000) or (B)
any Lender, and (v) deposits in existing Xxxxxxx Xxxxx money market accounts
maintained by Borrower, such deposits being the proceeds from the exercise of
stock options pursuant to Borrower's employee stock option plans.
"CIP BUDGET AMOUNT" means the total budgeted cost (as such budget
shall be updated from time to time) of all Current Construction Projects
(excluding Expansion Projects) owned by Borrower or any of its Subsidiaries or
by any GP Partnership or Simon Partnership or with respect to which Borrower or
any of its Subsidiaries has any type of funding obligation, construction
management obligation or obligation to assure project completion or leasing,
provided, however, that with respect to Current Construction Projects owned by a
Simon Partnership for which the respective financial responsibilities of Simon
and its Subsidiaries on the one hand and Borrower and its Subsidiaries on the
other hand are in proportion to the respective ownership interests in the
applicable Simon Partnership, there shall be excluded from the CIP Budget Amount
the portion of such budgeted cost in excess of Borrower's Share in the
applicable Simon Partnership. Such costs shall include, without limitation, all
land acquisition costs (but may exclude costs of land used for expansion
projects which was not purchased for the purpose of such expansion project),
design and permitting costs, construction period real estate taxes, leasing
costs including brokers' commissions and tenant improvements, allowances or
reimbursements, construction costs and opening costs. With respect to any
Construction Projects financed with Indebtedness other than the Revolving
Facility, such costs shall also include construction period interest and all
fees and expenses associated with such Indebtedness.
"CLOSING DATE" means November 3, 1998.
"COMMISSION" means the Securities and Exchange Commission.
"COMMITMENT" means, with respect to any Lender, the principal amount
set out under such Lender's name under the heading "Loan Commitment" on the
signature pages attached to this Agreement.
"COMPLETION DATE" means, with respect to a Construction Project, the
date on which certificates of occupancy (or the equivalent) have been issued for
at least 90% of the gross leasable area of such Construction Project.
"COMPLIANCE CERTIFICATE" means a certificate in the form of EXHIBIT B
delivered to Agent by Borrower pursuant to SECTION 2.1.2, SECTION 3.4, SECTION
6.1.4, SECTION 6.1.11 or any other provision of this Agreement and covering
Borrower's compliance with the financial covenants contained in ARTICLE IX.
"CONFIDENTIAL INFORMATION" has the meaning ascribed to such term in
SECTION 6.3.
"CONSTRUCTION PROJECT" means a project consisting of the construction
of new buildings, additions to existing buildings, and/or rehabilitation of
existing buildings (other than normal refurbishing and tenant fit-up work when
one retail tenant leases space previously occupied by another retail tenant).
"CONTAMINANT" means any pollutant (as that term is defined in 42
U.S.C. 9601(33)) or toxic pollutant (as that term is defined in 33 U.S.C.
1362(13)), hazardous substance (as that term is defined in 42 U.S.C. 9601(14)),
hazardous chemical (as that term is defined by 29 CFR Section 1910.1200(c)),
toxic substance, hazardous waste (as that term is defined in 42 U.S.C. 6903(5)),
radioactive material, special waste, petroleum (including crude oil or any
petroleum-derived substance, waste, or breakdown or decomposition product
thereof), any constituent of any such substance or waste, including, but not
limited to, polychlorinated biphenyls and asbestos, or any other substance or
waste deleterious to the environment the release, disposal or remediation of
which is now or at any time becomes subject to regulation under any
Environmental Law.
"CONTRACTUAL OBLIGATION", as applied to any Person, means any
provision of any Securities issued by that Person or any indenture, mortgage,
deed of trust, lease, contract, undertaking, document or instrument to which
that Person is a party or by which it or any of its properties is bound, or to
which it or any of its properties is subject (including, without limitation, any
restrictive covenant affecting such Person or any of its properties).
"COURT ORDER" means any judgment, writ, injunction, decree, rule or
regulation of any court or Governmental Authority binding upon or applicable to
the Person in question.
"CURRENT CONSTRUCTION PROJECT" means a Construction Project from the
time of commencement of construction (of footings and foundations with respect
to Construction Projects consisting of new buildings) for such Construction
Project until the Rent Stabilization Date of such Construction Project.
"DEBT SERVICE" means, for any period, Interest Expense for such period
PLUS scheduled principal amortization (I.E., excluding any balloon payment due
at maturity) for such period on all Borrower Debt.
"DEFAULTING LENDER" means any Lender which fails or refuses to perform
its obligations under this Agreement within the time period specified for
performance of such obligation or, if no time frame is specified, if such
failure or refusal continues for a period of five (5) Business Days after notice
from Agent.
"DOL" means the United States Department of Labor and any successor
department or agency.
"DOLLARS" AND "$" means the lawful money of the United States of
America.
"EBITDA" means, at any time, for the most recent Fiscal Quarter, the
Borrower's earnings (or loss) before interest, taxes, depreciation and
amortization, calculated for such period on a consolidated basis in conformity
with GAAP and excluding earnings attributable to Simon Partnerships or minority
interests MINUS gains (and PLUS losses) from extraordinary items or asset sales
or write-ups or forgiveness of Indebtedness, MINUS percentage rent income for
such Fiscal Quarter, PLUS twenty-five percent (25%) of the total percentage rent
income during such Fiscal Quarter and the three immediately preceding Fiscal
Quarters.
"ELIGIBLE ASSIGNEE" means (i) (A) (1) a commercial bank organized
under the laws of the United States or any state thereof; (2) a savings and loan
association or savings bank organized under the laws of the United States or any
state thereof; or (3) a commercial bank organized under the laws of any other
country or a political subdivision thereof, PROVIDED that (x) such bank is
acting through a branch or agency located in the United States, or (y) such bank
is organized under the laws of a country that is a member of the Organization
for Economic Cooperation and Development or a political subdivision of such
country; that (B) in each case, is (1) reasonably acceptable to Agent and
Borrower, and (2) has total assets in excess of $10,000,000,000 and a rating on
its (or its parent's) senior unsecured debt obligations of at least BBB by one
of the Rating Agencies; or (ii) any Lender or Affiliate of any Lender; PROVIDED
that no Affiliate of Borrower shall be an Eligible Assignee.
"ENVIRONMENTAL LAWS" has the meaning set forth in SECTION 5.22.
"ENVIRONMENTAL LIEN" means a Lien in favor of any Governmental
Authority for (i) any liability under Environmental Laws, or (ii) damages
arising from, or costs incurred by such Governmental Authority in response to, a
Release or threatened Release of a Contaminant into the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute.
"ERISA AFFILIATE" of any Person means any (i) corporation which is,
becomes, or is deemed to be a member of the same controlled group of
corporations (within the meaning of Section 414(b) of the Internal Revenue Code)
as such Person, (ii) partnership, trade or business (whether or not
incorporated) which is, becomes or is deemed to be under common control (within
the meaning of Section 414(c) of the Internal Revenue Code) with such Person,
(iii) other Person which is, becomes or is deemed to be a member of the same
"affiliated service group" (as defined in Section 414(m) of the Internal Revenue
Code) as such Person, or (iv) any other organization or arrangement described in
Section 414(o) of the Internal Revenue Code which is, becomes or is deemed to be
required to be aggregated pursuant to regulations issued under Section 414(o) of
the Internal Revenue Code with such Person pursuant to Section 414(o) of the
Internal Revenue Code.
"EVENT OF DEFAULT" means any of the occurrences set forth in ARTICLE X
after the expiration of any applicable grace period expressly provided therein.
"EXECUTIVE OFFICERS" mean Xxxxx X. Xxxxx, Xxxxxxx X. Xxxxx, Xxxxx X.
Xxxxxxxx, Xxxxxx X. Xxxx and Xxxxxx X. Xxxxx.
"EXPANSION PROJECTS" means Construction Projects consisting of the
construction of additional buildings or building additions at a Portfolio
Property or a Simon Property which has been open and operating as a retail
center with a Property Occupancy Rate of at least 90% as of the start of such
Construction Project so long as the increase in the gross leasable area of such
Property as a result of such Construction Project does not exceed 150,000 square
feet.
"FACILITY" means the term loan facility of Sixty Million Dollars
($60,000,000) described in SECTION 2.1.1.
"FAIR MARKET NET WORTH" means the Borrower's Adjusted Asset Value less
Total Liabilities.
"FDIC" means the Federal Deposit Insurance Corporation or any
successor thereto.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by Agent from three Federal Funds brokers of recognized
standing selected by Agent.
"FEDERAL RESERVE BOARD" means the Board of Governors of the Federal
Reserve System or any governmental authority succeeding to its functions.
"FEE LETTER" means a certain fee letter between the Borrower and the
Agent dated October 20, 1998, as amended, modified or replaced from time to
time.
"FINANCIAL STATEMENTS" has the meaning given to such term in SECTION
6.1.2.
"FISCAL QUARTER" means each three-month period ending on March 31,
June 30, September 30 and December 31.
"FISCAL YEAR" means the fiscal year of Borrower which shall be the
twelve (12) month period ending on the last day of December in each year.
"FIXED CHARGES" means, for any period, Debt Service PLUS scheduled
dividends or distributions due with respect to preferred partnership units in
the Borrower or preferred stock in the REIT.
"FIXED RATE NOTICE" means, with respect to a LIBOR Loan pursuant to
SECTION 2.1.2, a notice substantially in the form of EXHIBIT E.
"FIXED RATE PREPAYMENT FEE" has the meaning given to such term in
SECTION 2.4.8(C).
"FOREIGN AFFILIATES" means Value Retail PLC, a corporation formed
under the laws of Great Britain and any other partnership or entity which may be
sponsored by or affiliated with Value Retail PLC and any other Affiliate (which
may need to be approved by Agent pursuant to SECTION 8.3) which may develop, own
or finance one or more Foreign Properties.
"FOREIGN INVESTMENTS" means the aggregate amount of all Investments by
Borrower in Borrower's Foreign Affiliates plus the face amount of all Letters of
Credit issued under the Revolving Credit Agreement (or letters of credit issued
by any other Person with respect to which Borrower is directly or contingently
liable) for the benefit of such Foreign Affiliates, plus the aggregate
Acquisition Prices of all Foreign Properties owned by Borrower or its
Subsidiaries.
"FOREIGN PROPERTIES" means all Properties which are not located within
the boundaries of the United States.
"FUNDS FROM OPERATIONS" means, for any period, the Borrower's Funds
From Operations determined in accordance with the definition approved by the
National Association of Real Estate Investment Trusts.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board, or in such other statements by such
other entity as may be in general use by significant segments of the accounting
profession, which are applicable to the circumstances as of the date of
determination.
"GOVERNMENTAL AUTHORITY" means any nation or government, any federal,
state, local, municipal or other political subdivision thereof or any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"GP PARTNERSHIP" means any Partnership in which Borrower, the REIT or
any Subsidiary of Borrower or the REIT is a general partner. As provided in
SECTION 8.8.1 the REIT may not become a partner in any additional Partnerships.
"GUARANTOR SUBSIDIARY" means a Wholly-Owned Subsidiary which executes
and delivers a guaranty of the Obligations in favor of the Agent and the
Lenders, which guaranty shall be substantially in the form of the Guaranty from
the REIT and shall be accompanied by certificates and a legal opinion reasonably
acceptable to the Agent.
"GUARANTY" means the Guaranty of even date herewith executed by the
REIT in favor of the Agent and the Lenders.
"INDEBTEDNESS", as applied to any Person (determined on a consolidated
basis and without duplication), means the sum of (i) all indebtedness,
obligations or other liabilities of such Person for borrowed money, (ii) all
indebtedness, obligations or other liabilities of such Person evidenced by
Securities or other similar instruments, (iii) all reimbursement obligations and
other liabilities of such Person with respect to letters of credit or banker's
acceptances issued for such Person's account, (iv) all obligations of such
Person to pay the deferred purchase price of Property or services or to
reimburse tenants for the costs of improvements constructed by such tenants on
the Property of such Person, (v) all obligations in respect of Capital Leases of
such Person, (vi) all Accommodation Obligations of such Person, (vii) all
indebtedness, obligations or other liabilities of such Person or others secured
by a Lien on any asset of such Person, whether or not such indebtedness,
obligations or liabilities are assumed by, or are a personal liability of, such
Person (including, without limitation, the principal amount of any assessment or
similar indebtedness encumbering any property), (viii) all indebtedness,
obligations or other liabilities (other than interest expense liability) in
respect of Interest Rate Contracts and foreign currency exchange agreements, and
(ix) ERISA obligations currently due and payable. Indebtedness shall not include
accrued ordinary operating expenses payable on a current basis.
"INTEREST EXPENSE" means, for any period, total interest expense,
whether paid, accrued or capitalized (including the interest component of
Capital Leases) in respect of Borrower Debt, including, without limitation,
amortization of loan acquisition costs, all commissions, discounts and other
fees and charges owed with respect to letters of credit, net costs under
Interest Rate Contracts, and unused facility fees payable to the lenders
pursuant to the Revolving Credit Agreement.
"INTEREST PERIOD" means, relative to any LIBOR Loans, the period
beginning on (and including) the date on which such LIBOR Loans are made as, or
converted into, LIBOR Loans, and ending on (but excluding) the day which
numerically corresponds to such date thirty (30), sixty (60) or ninety (90) days
thereafter, in either case as Borrower may select in its relevant Notice of
Interest Rate Selection pursuant to SECTION 2.1.2; PROVIDED, HOWEVER, that:
(a) if such Interest Period would otherwise end on a day
which is not a Business Day, such Interest Period shall end on the next
following Business Day; and
(b) no Interest Period may end later than the then
applicable Termination Date.
"INTEREST RATE CONTRACTS" means, collectively, interest rate swap,
collar, cap or similar agreements providing interest rate protection.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended from time to time hereafter, and any successor statute.
"INVESTMENT" means, as applied to any Person, any direct or indirect
purchase or other acquisition by that Person of Securities, or of a beneficial
interest in Securities, of any other Person, and any direct or indirect loan,
advance (other than deposits with financial institutions available for
withdrawal on demand, prepaid expenses, advances to employees and similar items
made or incurred in the ordinary course of business), or capital contribution by
such Person to any other Person, including all Indebtedness and accounts owed by
that other Person which are not current assets or did not arise from sales of
goods or services to that Person in the ordinary course of business.
"INVESTMENT MORTGAGES" mean notes receivable or other indebtedness
secured by mortgages or other security interests directly or indirectly owned by
Borrower or any Subsidiary of Borrower, including certificates of interest in
real estate mortgage investment conduits.
"INVESTMENT PARTNERSHIP" means any Partnership in which Borrower or
any Subsidiary of Borrower has an ownership interest, whose financial results
are not consolidated under GAAP in the Financial Statements. Investment
Partnerships do not include Simon Partnerships.
"IRS" means the Internal Revenue Service and any Person succeeding to
the functions thereof.
"LAND" means unimproved real estate, including future phases of a
partially completed project, owned by Borrower or any Subsidiary of Borrower for
the purpose of future development of improvements. For purposes of the foregoing
definition, "unimproved" shall mean Land on which the construction of building
improvements has not commenced or land on which construction has been
discontinued for a continuous period longer than sixty (60) days prior to
completion.
"LEASE" means a lease or license between Borrower and a tenant or
licensee with respect to premises located within a Portfolio Property.
"LENDER TAXES" has the meaning given to such term in SECTION 2.4.7.
"LENDERS" means BankBoston and any other bank, finance company,
insurance or other financial institution which is or becomes a party to this
Agreement by execution of a counterpart signature page hereto or an Assignment
and Assumption, as assignee. With respect to matters requiring the consent to or
approval of all Lenders at any given time, all then existing Defaulting Lenders
will be disregarded and excluded, and, for voting purposes only, "all Lenders"
shall be deemed to mean "all Lenders other than Defaulting Lenders".
"LETTER OF CREDIT" means a letter of credit issued by the Lender for
the account of Borrower pursuant to the Revolving Credit Agreement.
"LIABILITIES AND COSTS" means all claims, judgments, liabilities,
obligations, responsibilities, losses, damages (including lost profits),
punitive or treble damages, costs, disbursements and expenses (including,
without limitation, reasonable attorneys, experts' and consulting fees and costs
of investigation and feasibility studies), fines, penalties and monetary
sanctions, interest, direct or indirect, known or unknown, absolute or
contingent, past, present or future.
"LIBOR" means, relative to any Interest Period for any LIBOR Loan, the
per annum rate (reserve adjusted as hereinbelow provided) of interest quoted by
Agent, rounded upwards, if necessary, to the nearest one-sixteenth of one
percent (0.0625%) at which Dollar deposits in immediately available funds are
offered to Agent by leading banks in the Eurodollar interbank market two (2)
Business Days prior to the beginning of such Interest Period, for delivery on
the first day of such Interest Period for a period approximately equal to such
Interest Period and in an amount equal or comparable to the LIBOR Loan to which
such Interest Period relates. The foregoing rate of interest shall be reserve
adjusted by dividing LIBOR by one (1.00) minus the LIBOR Reserve Percentage,
with such quotient to be rounded upward to the nearest whole multiple of
one-hundredth of one percent (0.01%). All references in this Agreement or other
Loan Documents to LIBOR shall mean and include the aforesaid reserve adjustment.
"LIBOR LOAN" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to LIBOR.
"LIBOR OFFICE" means, relative to any Lender, the office of such
Lender designated as such on the counterpart signature pages hereto or such
other office of a Lender as designated from time to time by notice from such
Lender to Agent, whether or not outside the United States, which shall be making
or maintaining LIBOR Loans of such Lender.
"LIBOR RESERVE PERCENTAGE" means, relative to any Interest Period for
LIBOR Loans made by any Lender, the reserve percentage (expressed as a decimal)
equal to the actual aggregate reserve requirements (including all basic,
emergency, supplemental, marginal and other reserves and taking into account any
transactional adjustments or other scheduled changes in reserve requirements)
announced within Agent as the reserve percentage applicable to Agent as
specified under regulations issued from time to time by the Federal Reserve
Board. The LIBOR Reserve Percentage shall be based on Regulation D of the
Federal Reserve Board or other regulations from time to time in effect
concerning reserves for "Eurocurrency Liabilities" from related institutions as
though Agent were in a net borrowing position.
"LIEN" means any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, security interest, encumbrance (including, but
not limited to, easements, rights-of-way, zoning restrictions and the like),
lien (statutory or other), preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever, including without
limitation any conditional sale or other title retention agreement, the interest
of a lessor under a Capital Lease, any financing lease having substantially the
same economic effect as any of the foregoing, and the filing of any financing
statement or document having similar effect (other than a financing statement
filed by a "true" lessor pursuant to Section 9408 of the Uniform Commercial
Code) naming the owner of the asset to which such Lien relates as debtor, under
the Uniform Commercial Code or other comparable law of any jurisdiction.
"LOAN ACCOUNT" has the meaning given to such term in SECTION 2.3.
"LOAN DOCUMENTS" means this Agreement, the Loan Notes, the Guaranty
and all other agreements, instruments and documents (together with amendments
and supplements thereto and replacements thereof) now or hereafter executed by
the Borrower, which evidences or relates to the Obligations.
"LOAN NOTES" means the promissory notes evidencing the Loans in the
aggregate original principal amount of Sixty Million Dollars ($60,000,000)
executed by Borrower in favor of Lenders, as they may be amended, supplemented,
replaced or modified from time to time. The initial Loan Notes and any
replacements thereof shall be substantially in the form of EXHIBIT C.
"LOANS" means the Loans made pursuant to the Facility.
"LONG TERM UNSECURED INDEBTEDNESS" means all Unsecured Indebtedness
which at the time of determination has a maturity of not less than five (5)
years.
"MAJORITY PARTNERSHIP" means any Partnership in which Borrower has an
ownership interest, whose financial results are consolidated under GAAP in the
Financial Statements.
"MATERIAL ADVERSE EFFECT" means, with respect to a Person or Property,
a material adverse effect upon the condition (financial or otherwise),
operations, performance or properties of such Person or Property. The phrase
"has a Material Adverse Effect" or "will result in a Material Adverse Effect" or
words substantially similar thereto shall in all cases be intended to mean "has
resulted, or will or could reasonably be anticipated to result, in a Material
Adverse Effect", and the phrase "has no (or does not have a) Material Adverse
Effect" or "will not result in a Material Adverse Effect" or words substantially
similar thereto shall in all cases be intended to mean "does not or will not or
could not reasonably be anticipated to result in a Material Adverse Effect".
"MATERIALLY DEFAULTED LEASES" means Leases under which the tenant has
failed to make any payment of base rent, percentage rent or additional rent when
due and such failure has continued for more than ninety (90) days after the due
date of the applicable payment or any Lease which the Borrower has terminated
based on any default by the Tenant thereunder.
"MULTIEMPLOYER PLAN" means an employee benefit plan defined in Section
4001(a)(3) of ERISA which is, or within the immediately preceding six (6) years
was, contributed to by a Person or an ERISA Affiliate of such Person.
"NET OPERATING INCOME" means with respect to any Fiscal Quarter of the
Borrower and with respect to any one or more of its Properties, (i) the total
rental and other operating income from the operation of such Properties after
deducting all expenses and other proper charges incurred by the Borrower in
connection with the operation of such Properties during such Fiscal Quarter,
including, without limitation, property operating expenses, real estate taxes
and bad debt expenses, but before payment or provision for debt service, income
taxes, and depreciation, amortization, and other non-cash expenses, all as
determined in accordance with generally accepted accounting principles, MINUS
(ii) percentage rent income of such Properties for such Fiscal Quarter, PLUS
(iii) twenty-five percent (25%) of the total percentage rent income of such
Properties during such Fiscal Quarter and the three immediately preceding Fiscal
Quarters, minus (iv) the Replacement Reserve Amount for such Properties. With
respect to Properties located outside of the United States, Net Operating Income
shall be converted from the currency in which the applicable income and expenses
are paid to Dollars using the currency exchange rates in effect as of the end of
the applicable Fiscal Quarter.
"NET OFFERING PROCEEDS" means all cash proceeds received by the REIT
as a result of the sale of common, preferred or other classes of stock in the
REIT (if and only to the extent reflected in stockholders' equity on the
consolidated balance sheet of the REIT prepared in accordance with GAAP) LESS
customary costs and discounts of issuance paid by the REIT, all of which
proceeds shall have been concurrently contributed by the REIT to Borrower as
additional capital.
"NON-RETAIL PROPERTIES" means Portfolio Properties which are not
intended to be used as or in connection with a retail Property including
residential or other Properties in the vicinity of Construction Projects
acquired to facilitate the obtaining of governmental permits or the resolution
of zoning or land use issues related to such Construction Projects.
"NONRECOURSE INDEBTEDNESS" means Indebtedness with respect to which
recourse for payment is contractually limited to specific assets encumbered by a
Lien securing such Indebtedness.
"NOTICE OF INTEREST RATE SELECTION" means a notice substantially in
the form of EXHIBIT D given pursuant to SECTION 2.1.2.
"OBLIGATIONS" means, from time to time, all Indebtedness of Borrower
owing to Agent, any Lender or any Person entitled to indemnification pursuant to
SECTION 12.2, or any of their respective successors, transferees or assigns, of
every type and description, whether or not evidenced by any note, guaranty or
other instrument, arising under or in connection with this Agreement or any
other Loan Document, whether or not for the payment of money, whether direct or
indirect (including those acquired by assignment), absolute or contingent, due
or to become due, now existing or hereafter arising and however acquired. The
term includes, without limitation, all interest, charges, expenses, fees,
reasonable attorneys' fees and disbursements, reasonable fees and disbursements
of expert witnesses and other consultants, and any other sum now or hereinafter
chargeable to Borrower under or in connection with this Agreement or any other
Loan Document.
"OFFICER'S CERTIFICATE" means a certificate signed by a specified
officer of a Person certifying as to the matters set forth therein.
"OPERATING CASH FLOW" means, at any time, for the most recent Fiscal
Quarter, EBITDA MINUS cash income taxes paid during such Fiscal Quarter and not
deducted on the Financial Statements in determining earnings for such Fiscal
Quarter or any prior period MINUS the Replacement Reserve Amount for the
Portfolio Properties.
"PARTNERSHIP" means any general or limited partnership, joint venture,
corporation, limited liability company or limited liability partnership in which
Borrower, the REIT or any Subsidiary of Borrower or the REIT has an ownership
interest and which is not a Wholly-Owned Subsidiary, excluding, however, the
Simon Partnerships.
"PARTNERSHIP AGREEMENT" means, with respect to any Partnership, on a
collective basis, its partnership agreement, its agreement of limited
partnership agreement and certificate of limited partnership (if any), its
operating or management agreement and articles or certificate of organization,
or other organizational or governance document(s).
"PBGC" means the Pension Benefit Guaranty Corporation or any Person
succeeding to the functions thereof.
"PERMIT" means any permit, approval, authorization, license, variance
or permission required from a Governmental Authority under an applicable
Requirement of Law.
"PERMITTED LIENS" means:
(a) Liens (other than Environmental Liens and any Lien
imposed under ERISA) for taxes, assessments or charges of any
Governmental Authority or claims not yet due or not yet required to be
paid pursuant to SECTION 7.4;
(b) Liens (other than any Lien imposed under ERISA)
incurred or deposits made in the ordinary course of business (including
without limitation surety bonds and appeal bonds) in connection with
workers' compensation, unemployment insurance and other types of social
security benefits or to secure the performance of tenders, bids,
leases, contracts (other than for the repayment of Indebtedness),
statutory obligations;
(c) any laws, ordinances, easements, rights of way,
restrictions, exemptions, reservations, conditions, defects or
irregularities in title, limitations, covenants or other matters that,
in the aggregate, do not in the reasonable opinion of Borrower (i)
materially interfere with the occupation, use and enjoyment of the
Property or other assets encumbered thereby, by the Person owning such
Property or other assets, in the normal course of its business or (ii)
materially impair the value of the Property subject thereto;
(d) Liens imposed by laws, such as mechanics' liens and
other similar liens arising in the ordinary course of business which
either (i) have been in existence for less than 120 days from the date
of filing or (ii) have been in existence for longer than said 120 days
so long as the aggregate amount of all such Liens is less than $100,000
for each Construction Project and the Borrower is in good faith
contesting the validity or amount thereof by appropriate proceedings,
provided however that any Lien permitted under this paragraph must be
discharged prior to foreclosure thereof;
(e) Leases to tenants which are not Affiliates of Borrower
existing on the date hereof or subsequently entered into in the
ordinary course of business;
(f) Liens securing judgments or awards permitted by
SECTION 8.10(D); and
(g) Liens securing purchase money Indebtedness permitted
by SECTION 8.10(F) provided that each such Lien shall encumber only the
specific item of equipment purchased with the proceeds of the
Indebtedness secured thereby.
"PERSON" means any natural person, employee, corporation, limited
partnership, general partnership, joint stock company, limited liability
company, joint venture, association, company, trust, bank, trust company, land
trust, business trust or other organization, whether or not a legal entity, or
any other non-governmental entity, or any Governmental Authority.
"PLAN" means an employee benefit plan defined in Section 3(3) of ERISA
(other than a Multiemployer Plan) in respect of which Borrower or an ERISA
Affiliate, as applicable, is an "employer" as defined in Section 3(5) of ERISA.
"PORTFOLIO OCCUPANCY RATE" means, with respect to the Portfolio
Properties at any time, the ratio, as of such date, expressed as a percentage,
of (i) the gross leasable area of all Portfolio Properties occupied by tenants
paying rent pursuant to Leases other than Materially Defaulted Leases, to (ii)
the aggregate gross leasable area of all Portfolio Properties excluding from
both (i) and (ii) the gross leasable area of Construction Projects thereon prior
to the date which is 3 months after the Rent Stabilization Date for such
Construction Project. Only premises which are actually open for business shall
be counted as occupied. Non-Retail Properties shall be excluded from Portfolio
Properties for purposes of this definition.
"PORTFOLIO PROPERTIES" means real property improved with one or more
completed buildings that is owned directly or indirectly, in whole or in part,
by Borrower, any Subsidiary of Borrower or any Partnership, including the
Unencumbered Properties and the Properties listed on SCHEDULE 1.1, as such
schedule may be updated from time to time to reflect the acquisition or
disposition of Portfolio Properties. Portfolio Properties do not include the
Simon Properties.
"PREPAYMENT DATE" has the meaning given to such term in SECTION
2.4.8(C).
"PRIOR FINANCIALS" has the meaning given to such term in SECTION 5.9.
"PRO FORMA UNSECURED DEBT SERVICE CHARGES" means, for any Fiscal
Quarter of the Borrower, the sum of (a) an amount determined by the Borrower
(and approved by the Agent in its sole discretion) based on a twenty-five (25)
year mortgage style amortization schedule, calculated on the outstanding
principal amount of all Unsecured Indebtedness excluding Long Term Unsecured
Indebtedness and an interest rate equal to the greater of (i) the weighted
average annual interest rate actually applicable to all Unsecured Indebtedness
excluding Long Term Unsecured Indebtedness during such Fiscal Quarter or (ii)
the then current ten (10) year U.S. Treasury xxxx yield plus one and
three-quarters percent (1.75%) plus (b) one-quarter of the actual debt service
charges due during the current fiscal year pursuant to the Long Term Unsecured
Indebtedness.
"PRO RATA SHARE" means, with respect to any Lender, a fraction
(expressed as a percentage), the numerator of which shall be the amount of such
Lender's Loans outstanding and the denominator of which shall be the aggregate
amount of all of the Lenders' Loans outstanding.
"PROCEEDINGS" means, collectively, all actions, suits and proceedings
before, and investigations commenced or threatened by or before, any court or
Governmental Authority with respect to a Person.
"PROPERTY" means, as to any Person, all real or personal property
(including, without limitation, buildings, facilities, structures, equipment and
other assets, tangible or intangible) owned by such Person.
"PROPERTY OCCUPANCY RATE" means, with respect to any Portfolio
Property or Simon Property at any time, the ratio, as of such date, expressed as
a percentage, of (i) the gross leasable area of such Portfolio Property or Simon
Property occupied by tenants paying rent pursuant to Leases other than
Materially Defaulted Leases, to (ii) the aggregate gross leasable area of such
Portfolio Property or Simon Property, excluding from both (i) and (ii) the gross
leasable area of Construction Projects prior to the date which is 3 months after
the Rent Stabilization Date for such Construction Project. Only premises which
are actually open for business shall be counted as occupied.
"RATING AGENCY" means either of (i) Standard & Poor's, a division of
The XxXxxx-Xxxx Companies, Inc. or (ii) Xxxxx'x Investors Services, Inc.
"RECOURSE SIMON DEBT AMOUNT" means the aggregate amount of the
Indebtedness of any Simon Partnership for which the Borrower has recourse
liability pursuant to a guaranty or other Accommodation Obligation provided,
however, that with respect to any such Indebtedness guaranteed jointly and
severally by Borrower and Simon (and with respect to which Borrower would have a
contribution claim against Simon) the Recourse Simon Debt Amount shall exclude
the amount of such guaranteed Indebtedness in excess of Borrower's Share in the
applicable Simon Partnership.
"REGULATIONS T, U AND X" mean such Regulations of the Federal Reserve
Board as in effect from time to time.
"REIT" means Chelsea GCA Realty, Inc., a Maryland corporation.
"RELEASE" means the release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the indoor or outdoor environment or into or out of any property, including the
movement of Contaminants through or in the air, soil, surface water, groundwater
or property.
"REMEDIAL ACTION" means any action required by applicable
Environmental Laws to (i) clean up, remove, treat or in any other way address
Contaminants in the indoor or outdoor environment; (ii) prevent the Release or
threat of Release or minimize the further Release of Contaminants so they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment; or (iii) perform preremedial studies and
investigations and post-remedial monitoring and care.
"RENT STABILIZATION DATE" means, with respect to each Construction
Project, the date which shall be (i) the first day of a Fiscal Quarter (ii) not
more than six (6) months after the date on which the first certificate of
occupancy (or the equivalent) has been issued for any portion of such
Construction Project and (iii) set forth in a notice from Borrower to Agent
given prior to such Rent Stabilization Date.
"REPLACEMENT RESERVE AMOUNT" means, with respect to any Property or
group of Properties for any Fiscal Quarter, a reserve for replacement reserves,
leasing costs and recurring capital expenditures equal to the product of $0.075
TIMES the gross leasable area of such Property or group of Properties excluding
the gross leasable area of any Construction Project thereon prior to the Rent
Stabilization Date with respect to such Construction Project.
"REPORTABLE EVENT" means any of the events described in Section
4043(b) of ERISA, other than an event for which the thirty (30) day notice
requirement is waived by regulations.
"REQUIREMENTS OF LAW" mean, as to any Person, the charter and by-laws,
Partnership Agreement or other organizational or governing documents of such
Person, and any law, rule or regulation, Permit, or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject, including without limitation, the Securities
Act, the Securities Exchange Act, Regulations T, U and X, FIRREA and any
certificate of occupancy, zoning ordinance, building, environmental or land use
requirement or Permit or occupational safety or health law, rule or regulation.
"REQUISITE LENDERS" mean, collectively, Lenders whose Pro Rata Shares,
in the aggregate, are at least sixty-six and two-thirds percent (66-2/3%),
PROVIDED that, in determining such percentage at any given time, all then
existing Defaulting Lenders will be disregarded and excluded and the Pro Rata
Shares of Lenders shall be redetermined, for voting purposes only, to exclude
the Pro Rata Shares of such Defaulting Lenders and PROVIDED, FURTHER, that the
Agent must always be among the Requisite Lenders except that after an Event of
Default described in SECTION 10.1.1 decisions by the Requisite Lenders to
accelerate and/or exercise remedies pursuant to SECTION 10.2.1 shall be made
without regard to whether the Agent is among the Requisite Lenders.
"REVOLVING CREDIT AGREEMENT" means the Credit Agreement dated as of
March 30, 1998, among Borrower, the Agent and the lenders party thereto, as
hereafter amended pursuant to its terms.
"REVOLVING FACILITY" means the Borrower's revolving line of credit
facility in the maximum principal amount of $160,000,000, a portion of which may
be used for Letters of Credit, all as provided in the Revolving Credit
Agreement.
"SECURED BORROWER DEBT" means all Borrower Debt that is secured by a
Lien on any Property.
"SECURITIES" means any stock, shares, voting trust certificates,
bonds, debentures, notes or other evidences of indebtedness, secured or
unsecured, convertible, subordinated or otherwise, or in general any instruments
commonly known as "securities", or any certificates of interest, shares, or
participations in temporary or interim certificates for the purchase or
acquisition of, or any right to subscribe to, purchase or acquire any of the
foregoing, but shall not include any evidence of the Obligations, PROVIDED that
Securities shall not include Cash Equivalents, Investment Mortgages or interests
in Partnerships.
"SECURITIES ACT" means the Securities Act of 1933, as amended to the
date hereof and from time to time hereafter, and any successor statute.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended to the date hereof and from time to time hereafter, and any successor
statute.
"SIMON" means Simon Property Group, L.P.
"SIMON PARTNERSHIP" means each limited liability company general or
limited partnership, corporation or joint venture in which ownership interests
are held by (i) Borrower or one of its Wholly-Owned Subsidiaries and (ii) Simon
or one of its wholly-owned Subsidiaries.
"SIMON PARTNERSHIP CASH FLOW" means, at any time, with respect to any
Simon Partnership, for the most recent Fiscal Quarter, Simon Partnership EBITDA
of such Simon Partnership MINUS the Replacement Reserve Amount for the Simon
Property owned by such Simon Partnership.
"SIMON PARTNERSHIP EBITDA" means, at any time, with respect to any
Simon Partnership, for the most recent Fiscal Quarter, such Simon Partnership's
earnings (or loss) before interest, taxes, depreciation and amortization,
calculated for such period on a consolidated basis in conformity with GAAP minus
gains (and PLUS losses) from extraordinary items or asset sales or write-ups or
forgiveness of Indebtedness, MINUS percentage rent income for such Fiscal
Quarter, PLUS twenty-five percent (25%) of the total percentage rent income
during such Fiscal Quarter and the three immediately preceding Fiscal Quarters.
"SIMON PARTNERSHIP VALUE" means, as at any date of determination, with
respect to any Simon Partnership, the Borrower's Share of an amount equal to the
excess, if any, of (i) (A) Simon Partnership Cash Flow of such Simon Partnership
for the most recently ended Fiscal Quarter, TIMES (B) four (4), DIVIDED BY (C)
0.095, MINUS (ii) all Indebtedness and other liabilities of such Simon
Partnership. "SIMON PROPERTY" means any Property owned by a Simon Partnership.
"SOLVENT" means, as to any Person at the time of determination, that
such Person (i) owns property the value of which (both at fair valuation and at
present fair saleable value) is greater than the amount required to pay all of
such Person's liabilities (including contingent liabilities and debts); (ii) is
able to pay all of its debts as such debts mature; and (iii) has capital
sufficient to carry on its business and transactions and all business and
transactions in which it is about to engage.
"SUBSIDIARY" of a Person means any corporation, Partnership, trust or
other non-Partnership entity of which a majority of the stock (or equivalent
ownership or controlling interest) having voting power to elect a majority of
the Board of Directors (if a corporation) or to select the trustee or equivalent
controlling interest, shall, at the time such reference becomes operative, be
directly or indirectly owned or controlled by such Person.
"TAXES" means all federal, state, local and foreign income and gross
receipts taxes.
"TERMINATION DATE" has the meaning given to such term in SECTION
2.1.4.
"TERMINATION EVENT" means (i) any Reportable Event, (ii) the
withdrawal of a Person, or an ERISA Affiliate from a Benefit Plan during a plan
year in which it was a "substantial employer" as defined in Section 4001(a)(2)
of ERISA, (iii) the occurrence of an obligation arising under Section 4041 of
ERISA of a Person or an ERISA Affiliate to provide affected parties with a
written notice of an intent to terminate a Benefit Plan in a distress
termination described in Section 4041(c) of ERISA, (iv) the institution by the
PBGC of proceedings to terminate any Benefit Plan under Section 4042 of ERISA,
(v) any event or condition which constitutes grounds under Section 4042 of ERISA
for the appointment of a trustee to administer a Benefit Plan, (vi) the partial
or complete withdrawal of such Person or any ERISA Affiliate from a
Multiemployer Plan, or (vii) the adoption of an amendment by any Person or any
ERISA Affiliate to terminate any Benefit Plan.
"TOTAL LIABILITIES" means (i) all Indebtedness of Borrower and its
Subsidiaries (excluding Indebtedness relating to the Indebtedness of Simon
Partnerships), whether or not such Indebtedness would be included as a liability
on the balance sheet of Borrower in accordance with GAAP, plus (ii) all other
liabilities of every nature and kind of Borrower and its Subsidiaries that would
be included as liabilities on the balance sheet of Borrower in accordance with
GAAP plus (iii) the Recourse Simon Debt Amount.
"UNENCUMBERED NET OPERATING INCOME" means, with respect to any Fiscal
Quarter of the Borrower, the sum of the Net Operating Income of all of its
Properties which were Unencumbered Properties hereunder during such Fiscal
Quarter.
"UNENCUMBERED PROPERTY" means a Property which at the date of
determination, (i) is owned in fee by Borrower or by a Guarantor Subsidiary,
(ii) is improved with one or more completed retail buildings of a type
consistent with Borrower's business strategy; (iii) is not directly or
indirectly subject to any Lien (other than Permitted Liens) or to any negative
pledge agreement or other agreement (other than this Agreement) that prohibits
the creation of any Lien thereon; (iv) is a Property with respect to which each
of the representations contained in SECTION 5.22 and in SECTION 5.23 hereof is
true and accurate as of such date of determination; (v) may be legally conveyed
separately from any other Real Estate without the need to obtain any subdivision
approval, zoning variance or other consent or approval from an unrelated Person;
(vi) is located in the United States, and (vii) to the extent requested by the
Agent, the Borrower has delivered to the Agent historical operating and leasing
information relating to such Unencumbered Property, in form and substance
satisfactory to the Agent.
"UNENCUMBERED PROPERTY VALUE" means, with respect to any Unencumbered
Property at any time, an amount computed as follows: (a) the Net Operating
Income of such Unencumbered Property for the most recent Fiscal Quarter for
which financial statements have been delivered to the Agent pursuant to SECTION
6.1; (b) then multiplying by four (4); and (c) dividing such product by 0.095.
With respect to any Unencumbered Property which, during the applicable Fiscal
Quarter, has been acquired by Borrower or has had the building or buildings
being constructed thereon completed and occupied by tenants, Borrower may
compute the Unencumbered Property Value for such Unencumbered Property based on
a pro forma Net Operating Income for such Fiscal Quarter, which computation must
be approved by the Agent.
"UNMATURED EVENT OF DEFAULT" means an event which, with the giving of
notice or the lapse of time, or both, would constitute an Event of Default.
"UNSECURED INDEBTEDNESS" means all Indebtedness of Borrower or of any
of its Subsidiaries which is not secured by a Lien on any Properties including,
without limitation, the Loans, the loans under the Revolving Facility, the
Borrower's reimbursement obligations relating to the Letters of Credit issued
pursuant to the Revolving Facility, the BankBoston Term Loan, the Unsecured Term
Notes and any Indebtedness evidenced by any bonds, debentures, notes or other
debt securities which may be hereafter issued by Borrower or by the REIT.
Unsecured Indebtedness shall not include accrued ordinary operating expenses
payable on a current basis.
"UNSECURED TERM NOTE INDENTURE" means the Indenture dated as of
January 23, 1996 among the Borrower, the REIT and State Street Bank and Trust
Company, as trustee, as supplemented by First Supplemental Indenture dated as of
January 23, 1996, by Second Supplemental Indenture dated as of October 23, 1996
and by Third Supplemental Indenture dated as of October 21, 1997, and as
hereafter amended or further supplemented.
"UNSECURED TERM NOTE SECURED DEBT LIMITATION" means the provision
contained in the Unsecured Term Note Indenture which limits the Borrower's
"Secured Debt" to not more than 40% of its "Adjusted Total Assets" (as such
quoted terms are defined in said Indenture). If the Unsecured Term Note
Indenture is amended to reduce the permitted amount of Secured Borrower Debt
this defined term shall automatically be deemed to incorporate such amendment,
but if the Unsecured Term Note Indenture is amended to increase the permitted
amount of Secured Borrower Debt this definition shall not be deemed to
incorporate such amendment until the same has been approved by the Requisite
Lenders.
"UNSECURED TERM NOTES" means, collectively, (i) Borrower's 7 3/4%
notes due 2001 in the aggregate principal amount of $100,000,000, (ii)
Borrower's 7 1/4% notes due 2007 in the aggregate principal amount of
$125,000,000 and (iii) any other unsecured indebtedness of the Borrower which at
the time of its issuance matures not earlier than 24 months after the then
applicable Termination Date.
"VALUE OF ALL UNENCUMBERED PROPERTIES" means, when determined as of
the end of a Fiscal Quarter, an amount computed as follows: (a) Unencumbered Net
Operating Income; (b) then multiplying by four (4); and (c) dividing such
product by 0.095. When determined as of a date which is during a Fiscal Quarter
based on an updated list of Unencumbered Properties attached to the applicable
Compliance Certificate, the Value of All Unencumbered Properties most recently
computed as provided in the preceding sentence of this definition will be
adjusted by subtracting the Unencumbered Property Value of the previous
Unencumbered Properties which have been deleted from such list and by adding the
Unencumbered Property Value of the Unencumbered Properties which have been added
to such list
"WHOLLY-OWNED SUBSIDIARY" means a Subsidiary which is 100% owned by
Borrower.
"WOODBURY COMMON" means the Property owned by Borrower located at the
intersection of NY State Route 32 and the New York State Thruway in the Town of
Woodbury, Orange County, New York, including all expansions and additions
thereto.
"YEAR 2000 COMPLIANT" has the meaning given to such term in SECTION
5.33.
1.2 COMPUTATION OF TIME PERIODS. In this Agreement, in the computation
of periods of time from a specified date to a later specified date, the word
"from" means "from and including" and the words "to" and "until" each mean "to
and including". Periods of days referred to in this Agreement shall be counted
in calendar days unless Business Days are expressly prescribed.
1.3 TERMS.
1.3.1 Any accounting terms used in this Agreement which are not
specifically defined shall have the meanings customarily given them in
accordance with GAAP. All references herein to Borrower, the REIT or any other
Person, in connection with any financial or related covenant, representation or
calculation, shall be understood to mean and refer to Borrower, the REIT and
such other Person on a consolidated basis in accordance with GAAP, unless
otherwise specifically provided and subject in all events to any adjustments
herein set forth.
1.3.2 Any time the phrase "to the best of Borrower's knowledge"
or a phrase similar thereto is used herein, it means: "to the actual knowledge
of the then executive or senior officers of Borrower and the REIT, after
reasonable inquiry of those agents, employees or contractors of the REIT or
Borrower who could reasonably be anticipated to have knowledge with respect to
the subject matter or circumstances in question and after review of those
documents or instruments which could reasonably be anticipated to be relevant to
the subject matter or circumstances in question provided that such reasonable
inquiry need not be undertaken at the time of each Compliance Certificate."
1.3.3 In each case where the consent or approval of Agent, all
Lenders and/or Requisite Lenders is required, or their non-obligatory action is
requested by Borrower, such consent, approval or action shall be in the sole and
absolute discretion of Agent and, as applicable, each Lender, unless otherwise
specifically indicated.
1.3.4 Any time the word "or" is used herein, unless the context
otherwise clearly requires, it has the inclusive meaning represented by the
phrase "and/or". The words "hereof", "herein", "hereby", "hereunder" and similar
terms refer to this Agreement as a whole and not to any particular provision of
this Agreement. Article, section, subsection, clause, exhibit and schedule
references are to this Agreement unless otherwise specified. Any reference in
this Agreement to this Agreement or to any other Loan Document includes any and
all amendments, modifications, supplements, renewals or restatements thereto or
thereof, as applicable.
ARTICLE II
LOANS
2.1 ADVANCE AND REPAYMENT OF LOANS.
2.1.1 ADVANCE OF LOANS. Subject to the terms and conditions set
forth in this Agreement, Lenders hereby severally agree to make the Loans to
Borrower on the Closing Date. Loans under this Agreement shall be made by
Lenders simultaneously and in the full amount of their respective Commitments,
it being understood that no Lender shall be responsible for any failure by any
other Lender to perform its obligation to make a Loan hereunder and that the
Commitment of any Lender shall not be increased or decreased as a result of the
failure by any other Lender to perform its obligation to make a Loan. The Loans
may be voluntarily prepaid pursuant to SECTION 2.6.1 and, any amounts so prepaid
may not be reborrowed. The principal balance of the Loans shall be payable in
full on the Termination Date. The Loans will be evidenced by the Loan Notes.
2.1.2 NOTICE OF SELECTION OF INTEREST RATE.
(a) (i) Borrower shall give Agent,
at 000 Xxxxxxxxx Xxxxxx Xxxxx, X.X., Xxxxx 000, Xxxxxxx, XX 00000,
Attn: Xxxx X. Xxxxx (Fax No. (000)000-0000) or such other address as
Agent shall designate, an original or facsimile NOTICE OF INTEREST RATE
SELECTION no later than 9:00 A.M. (Eastern time), not less than three
(3) nor more than five (5) Business Days prior to the proposed Closing
Date and prior to the expiration of each Interest Period thereafter.
The Agent shall promptly provide a copy of each Notice of Interest Rate
Selection to each Lender.
(ii) Notwithstanding the foregoing or any
other provision hereof to the contrary a Notice of Interest Rate
Selection may be given not less than two (2) Business Days prior to
Closing Date or the expiration of an Interest Period if such notice
elects a Base Rate Loan.
(iii) Each Notice of Interest Rate
Selection shall specify whether the Loan to be made on the Closing Date
(or thereafter continued or converted) will be a Base Rate Loan or a
LIBOR Loan and, if a LIBOR Loan, the Interest Period.
(b) Borrower may elect (i) to convert a
LIBOR Loan into a Base Rate Loan, (ii) to convert a Base Rate Loan to a LIBOR
Loan, or (iii) to continue any LIBOR Loan for an additional Interest Period,
PROVIDED, HOWEVER, that the aggregate amount of the Loans being converted into
or continued as LIBOR Loans shall equal Four Million Dollars ($4,000,000) or an
integral multiple of One Million Dollars ($1,000,000) in excess thereof. The
applicable Interest Period for the continuation of any LIBOR Loan shall commence
on the day on which the next preceding Interest Period expires. The conversion
of a LIBOR Loan to a Base Rate Loan shall only occur on the last Business Day of
the Interest Period relating to such LIBOR Loan; such conversion shall occur
automatically in the absence of an election under CLAUSE (III) above. Each
election under CLAUSE (II) or CLAUSE (III) above shall be made by Borrower
giving Agent an original or facsimile Notice of Interest Rate Selection no later
than 9:00 A.M. (Eastern time), not less than three (3) nor more than five (5)
Business Days prior to the date of a conversion to or continuation of a LIBOR
Loan, specifying, in each case (1) the amount of the conversion or continuation,
(2) the Interest Period therefor, and (3) the date of the conversion or
continuation (which date shall be a Business Day).
(c) Upon receipt of a Notice of Interest Rate
Selection in proper form requesting LIBOR Loans under SUBPARAGRAPH (A) or (B)
above, Agent shall determine the LIBOR applicable to the Interest Period for
such LIBOR Loans, and shall, prior to the beginning of such Interest Period,
give (by facsimile) a FIXED RATE NOTICE in respect thereof to Borrower and
Lenders; PROVIDED, HOWEVER, that failure to give such notice to Borrower shall
not affect the validity of such rate. Each determination by Agent of the LIBOR
shall be conclusive and binding upon the parties hereto in the absence of
manifest error.
2.1.3 MAKING OF THE LOANS. Subject to SECTION 11.3, Agent shall
make the proceeds of the Loans available to Borrower on the Closing Date and
shall disburse such funds in Dollars in immediately available funds to repay
loans outstanding under the Revolving Facility.
2.1.4. TERM. The outstanding balance of the Loans shall be
payable in full on the earliest to occur of (i) April 30, 2000, (ii) the
acceleration of the Loans pursuant to SECTION 10.2.1, or (iii) Borrower's
written notice to Agent (pursuant to SECTION 2.6.1) of Borrower's election to
prepay all accrued obligations and terminate this Agreement (the "TERMINATION
DATE").
2.2 AUTHORIZATION TO SELECT INTEREST RATE OPTIONS. Each of Borrower's
President, Chief Financial Officer, Senior Vice President-Finance and Treasurer
are hereby authorized by Borrower to sign Notices of Interest Rate Selection.
Borrower may provide Agent with documentation satisfactory to Agent indicating
the names of other officers or employees of Borrower authorized by Borrower to
sign Notices of Interest Rate Selection, and Agent and Lenders shall be entitled
to rely on such documentation until notified in writing by Borrower of any
change(s) of the persons so authorized. Agent shall be entitled to act on the
instructions of anyone identifying himself or herself as one of the Persons
authorized to execute a Notice of Interest Rate Selection, and Borrower shall be
bound thereby in the same manner as if such Person were actually so authorized.
Borrower agrees to indemnify, defend and hold Lenders and Agent harmless from
and against any and all Liabilities and Costs which may arise or be created by
the acceptance of instructions in any Notice of Interest Rate Selection, unless
caused by the gross negligence of the Person to be indemnified.
2.3 LENDERS' ACCOUNTING. Agent shall maintain a loan account (the
"LOAN ACCOUNT") on its books in which shall be recorded (i) the names and
addresses of each Lender and the principal amount of the Loans owing to each
Lender from time to time, and (ii) all advances and repayments of principal and
payments of accrued interest under the Loans, as provided in this Agreement.
2.4 INTEREST ON THE LOANS.
2.4.1 BASE RATE LOANS. Subject to SECTION 2.4.4, all Base Rate
Loans shall bear interest on the average daily unpaid principal amount thereof
from the date made until paid in full at a fluctuating rate per annum equal to
the Base Rate. Base Rate Loans shall be made in minimum amounts of Four Million
Dollars ($4,000,000) or an integral multiple of One Million ($1,000,000) in
excess thereof.
2.4.2 LIBOR LOANS. Subject to SECTIONS 2.4.4 and 2.4.8, all LIBOR
Loans shall bear interest on the unpaid principal amount thereof during the
Interest Period applicable thereto at a rate per annum equal to the sum of LIBOR
for such Interest Period PLUS the Applicable LIBOR Rate Margin. LIBOR Loans
shall be in tranches of Four Million Dollars ($4,000,000) or One Million Dollar
($1,000,000) increments in excess thereof. No more than three (3) LIBOR Loan
tranches shall be outstanding at any one time. Notwithstanding anything to the
contrary contained herein and subject to the Default Interest provisions
contained in SECTION 2.4.4, if an Event of Default occurs and as a result
thereof the Loans are declared due and payable, all LIBOR Loans will convert to
Base Rate Loans upon the expiration of the applicable Interest Periods therefor
or the date all Loans become due, whichever occurs first.
2.4.3 INTEREST PAYMENTS. Subject to SECTION 2.4.4, interest
accrued on all Loans shall be payable by Borrower, in the manner provided in
SECTION 2.6.2, in arrears on the first Business Day of the first calendar month
following the Closing Date, the first Business Day of each succeeding calendar
month thereafter, and on the Termination Date.
2.4.4 DEFAULT INTEREST. Notwithstanding the rates of interest
specified in SECTIONS 2.4.1 and 2.4.2 and the payment dates specified in SECTION
2.4.3, effective immediately upon the occurrence and during the continuance of
any Event of Default, the principal balance of all Loans then outstanding and,
to the extent permitted by applicable law, any interest payments on the Loans
not paid when due shall bear interest payable upon demand at a rate which is
four percent (4%) per annum in excess of the Base Rate. All other amounts due
Agent or Lenders (whether directly or for reimbursement) under this Agreement or
any of the other Loan Documents if not paid when due, or if no time period is
expressed, if not paid within thirty (30) days after demand, shall bear interest
from and after demand at the rate set forth in this SECTION 2.4.4.
2.4.5 LATE FEE. Borrower acknowledges that late payment to Agent
will cause Agent and Lenders to incur costs not contemplated by this Agreement.
Such costs include, without limitation, processing and accounting charges.
Therefore, if Borrower fails timely to pay any sum due and payable hereunder
through the Termination Date, unless waived by Agent pursuant to SECTION 11.11.1
or Requisite Lenders, a late charge of four cents ($.04) for each dollar of any
principal payment, interest or other charge due hereon and which is not paid
within ten (10) days after such payment is due, shall be charged by Agent (for
the benefit of Lenders) and paid by Borrower for the purpose of defraying the
expense incident to handling such delinquent payment; PROVIDED, HOWEVER, that no
late charges shall be assessed with respect to any period during which Borrower
is obligated to pay interest at the rate specified in SECTION 2.4.4, or in
respect of any failure to pay all Obligations on the Termination Date. Borrower
and Agent agree that this late charge represents a reasonable sum considering
all of the circumstances existing on the date hereof and represents a fair and
reasonable estimate of the costs that Agent and Lenders will incur by reason of
late payment. Borrower and Agent further agree that proof of actual damages
would be costly and inconvenient. Acceptance of any late charge shall not
constitute a waiver of the default with respect to the overdue installment, and
shall not prevent Agent from exercising any of the other rights available
hereunder or any other Loan Document. Such late charge shall be paid without
prejudice to any other rights of Agent.
2.4.6 COMPUTATION OF INTEREST. Interest shall be computed on the
basis of the actual number of days elapsed in the period during which interest
or fees accrue and a year of three hundred sixty (360) days. In computing
interest on any Loan, the date of the making of the Loan shall be included and
the date of payment shall be excluded; PROVIDED, HOWEVER, that if a Loan is
repaid on the same day on which it is made, one (1) day's interest shall be paid
on that Loan. Notwithstanding any provision in this SECTION 2.4, interest in
respect of any Loan shall not exceed the maximum rate permitted by applicable
law.
2.4.7 CHANGES; LEGAL RESTRICTIONS. In the event that after the
Closing Date (i) the adoption of or any change in any law, treaty, rule,
regulation, guideline or determination of a court or Governmental Authority or
any change in the interpretation or application thereof by a court or
Governmental Authority, or (ii) compliance by Agent or any Lender with any
request or directive made or issued after the Closing Date from any central bank
or other Governmental Authority or quasi-governmental authority:
(a) subjects Agent or any Lender to any tax, duty or
other charge of any kind with respect to the Facility, this
Agreement or any of the other Loan Documents or the Loans, or
changes the basis of taxation of payments to Agent or such Lender
of principal, fees, interest or any other amount payable
hereunder, except for net income, gross receipts, gross profits
or franchise taxes imposed by any jurisdiction and not
specifically based upon loan transactions (all such non-excepted
taxes, duties and other charges being hereinafter referred to as
"LENDER TAXES");
(b) imposes, modifies or holds applicable, in the
determination of Agent or any Lender, any reserve, special
deposit, compulsory loan, FDIC insurance, capital allocation or
similar requirement (other than a requirement of the type
described in SECTION 2.7) against assets held by, or deposits or
other liabilities in or for the account of, advances or loans by,
or other credit extended by, or any other acquisition of funds
by, Agent or such Lender or any applicable lending office; or
(c) imposes on Agent or any Lender any other condition
(OTHER THAN ONE DESCRIBED IN SECTION 2.7) materially more
burdensome in nature, extent or consequence than those in
existence as of the Closing Date,
and the result of any of the foregoing is to increase the cost to Agent or any
Lender of making, renewing, maintaining or participating in the Loans or to
reduce any amount receivable thereunder; THEN, in any such case, Borrower shall
promptly pay to Agent or such Lender, as applicable, upon demand, such amount or
amounts (based upon a reasonable allocation thereof by Agent or such Lender to
the financing transactions contemplated by this Agreement and affected by this
SECTION 2.4.7) as may be necessary to compensate Agent or such Lender for any
such additional cost incurred or reduced amounts received; PROVIDED, HOWEVER,
that if the payment of such compensation may not be legally made whether by
modification of the applicable interest rate or otherwise, then all affected
Loans shall become immediately due and payable by Borrower. Agent or such Lender
shall deliver to Borrower and in the case of a delivery by Lender, such Lender
shall also deliver to Agent, a written statement of the claimed additional costs
incurred or reduced amounts received and the basis therefor as soon as
reasonably practicable after such Lender obtains knowledge thereof. If Agent or
any Lender subsequently recovers any amount of Lender Taxes previously paid by
Borrower pursuant to this SECTION 2.4.7, whether before or after termination of
this Agreement, then, upon receipt of good funds with respect to such recovery,
Agent or such Lender will refund such amount to Borrower if no Event of Default
or Unmatured Event of Default then exists or, if an Event of Default or
Unmatured Event of Default then exists, such amount will be credited to the
Obligations in the manner determined by Agent or such Lender.
2.4.8 CERTAIN PROVISIONS REGARDING LIBOR LOANS.
(a) LIBOR LENDING UNLAWFUL. If any Lender shall
determine (which determination shall, upon notice thereof to
Borrower and Agent, be conclusive and binding on the parties
hereto) that the introduction of or any change in or in the
interpretation of any law makes it unlawful, or any central bank
or other Governmental Authority asserts that it is unlawful, for
such Lender to make or maintain any Loan as a LIBOR Loan, (i) the
obligations of such Lenders to make or maintain any Loans as
LIBOR Loans shall, upon such determination, forthwith be
suspended until such Lender shall notify Agent that the
circumstances causing such suspension no longer exist, and (ii)
if required by such law or assertion, the LIBOR Loans of such
Lender shall automatically convert into Base Rate Loans in which
case no Fixed Rate Prepayment Fee shall be due upon such
conversion.
(b) DEPOSITS UNAVAILABLE. If Agent shall have
determined in good faith that adequate means do not exist for
ascertaining the interest rate applicable hereunder to LIBOR
Loans, then, upon notice from Agent to Borrower the obligations
of all Lenders to make or maintain Loans as LIBOR Loans shall
forthwith be suspended until Agent shall notify Borrower that the
circumstances causing such suspension no longer exist. Agent will
give such notice when it determines, in good faith, that such
circumstances no longer exist; PROVIDED, HOWEVER, that Agent
shall not have any liability to any Person with respect to any
delay in giving such notice.
(c) FIXED RATE PREPAYMENT FEE. Borrower acknowledges
that prepayment or acceleration of a LIBOR Loan during an
Interest Period shall result in Lenders incurring additional
costs, expenses and/or liabilities and that it is extremely
difficult and impractical to ascertain the extent of such costs,
expenses and/or liabilities. Therefore, on the date a LIBOR Loan
is prepaid or the date all sums payable hereunder become due and
payable, by acceleration or otherwise ("PREPAYMENT DATE"),
Borrower will pay to Agent, for the account of each Lender, (in
addition to all other sums then owing), an amount ("FIXED RATE
PREPAYMENT FEE") determined by the Agent to be the amount, if
any, by which (i) the amount of interest which would have accrued
on the prepaid LIBOR Loan for the remainder of the Interest
Period at the rate applicable to such LIBOR Loan exceeds (ii) the
amount of interest that would accrue for the same period on any
readily marketable bond or other obligation of the United States
of America designated by the Agent in its sole discretion at or
about the time of such payment, such bond or other obligation of
the United States of America to be in an amount equal (as nearly
as may be) to the amount of principal so paid or not borrowed and
to have a maturity comparable to the remainder of such Interest
Period, and the interest to accrue thereon to take account of
amortization of any discount from par or accretion of premium
above par at which the same is selling at the time designation.
(d) Upon the written notice to Borrower from Agent,
Borrower shall immediately pay to Agent, for the account of
Lenders, the Fixed Rate Prepayment Fee. Such written notice
(which shall include calculations in reasonable detail) shall, in
the absence of manifest error, be conclusive and binding on the
parties hereto.
(e) Borrower understands, agrees and acknowledges the
following: (i) no Lender has any obligation to purchase, sell
and/or match funds in connection with the use of LIBOR as a basis
for calculating the rate of interest on a LIBOR Loan; (ii) LIBOR
is used merely as a reference in determining such rate; and (iii)
Borrower has accepted LIBOR as a reasonable and fair basis for
calculating such rate and a Fixed Rate Prepayment Fee. Borrower
further agrees to pay the Fixed Rate Prepayment Fee and Lender
Taxes, if any, whether or not a Lender elects to purchase, sell
and/or match funds.
2.4.9 WITHHOLDING TAX EXEMPTION. At least five (5) Business Days prior
to the first day on which interest or fees are payable hereunder for the account
of any Lender, each Lender that is not incorporated under the laws of the United
States of America, or a state thereof, agrees that it will deliver to Agent and
Borrower two (2) duly completed copies of United States Internal Revenue Service
Form 1001 or Form 4224, certifying in either case that such Lender is entitled
to receive payments under this Agreement without deduction or withholding of any
United States federal income taxes. Each Lender which so delivers a Form 1001 or
Form 4224 further undertakes to deliver to Agent and Borrower two (2) additional
copies of such form (or any applicable successor form) on or before the date
that such form expires (currently, three (3) successive calendar years for Form
1001 and one (1) calendar year for Form 4224) or becomes obsolete or after the
occurrence of any event requiring a change in the most recent forms so delivered
by it, and such amendments thereto or extensions or renewals thereof as may be
reasonably requested by Agent or Borrower, in each case certifying that such
Lender is entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes, unless an event
(including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form with respect to it and
such Lender advises Agent that it is not capable of receiving payments without
any deduction or withholding of United States federal income taxes. If any
Lender cannot deliver such form, then Borrower may withhold from such payments
such amounts as are required by the Internal Revenue Code.
2.5 FEES.
2.5.1 FACILITY FEE. On the Closing Date Borrower shall pay to
Agent, for the account of each Lender, a fee calculated at the rate of 75 basis
points of the amount of the Facility and the Agent shall pay to each Lender its
Pro Rata Share of such facility fee.
2.5.2 AGENCY AND ARRANGEMENT FEES. Borrower shall pay Agent such
fees as are provided for in the Fee Letter between Agent and Borrower, as in
existence from time to time.
2.5.3 PAYMENT OF FEES. The fees described in this SECTION 2.5
represent compensation for services rendered and to be rendered separate and
apart from the lending of money or the provision of credit and do not constitute
compensation for the use, detention or forbearance of money, and the obligation
of Borrower to pay the fees described herein shall be in addition to, and not in
lieu of, the obligation of Borrower to pay interest, other fees and expenses
otherwise described in this Agreement. All fees shall be payable when due in
immediately available funds and shall be non-refundable when paid. If Borrower
fails to make any payment of fees or expenses specified or referred to in this
Agreement due to Agent or Lenders, including without limitation those referred
to in this SECTION 2.5, in SECTION 12.1, or otherwise under this Agreement or
any separate fee agreement between Borrower and Agent or any Lender relating to
this Agreement, when due, the amount due shall bear interest until paid at the
Base Rate and, after ten (10) days at the rate specified in SECTION 2.4.4 (but
not to exceed the maximum rate permitted by applicable law), and shall
constitute part of the Obligations.
2.6 PAYMENTS.
2.6.1 VOLUNTARY PREPAYMENTS. Borrower may, upon not less than
three (3) Business Days prior written notice to Agent not later than 11:00 A.M.
(Eastern time) on the date given, at any time and from time to time, prepay the
Loans in whole or in part. As provided in SECTION 11.13, any partial prepayment
will be shared among the Lenders ratably in accordance with their Pro Rata
Shares. Any notice of prepayment given to Agent under this SECTION 2.6.1 shall
specify the date of prepayment and the principal amount of the prepayment. In
the event of a prepayment of LIBOR Loans, Borrower shall concurrently pay any
Fixed Rate Prepayment Fee payable in respect thereof. Agent shall provide to
each Lender a confirming copy of such notice on the same Business Day such
notice is received.
2.6.2 MANNER AND TIME OF PAYMENT. All payments of principal,
interest and fees hereunder payable to Agent or the Lenders shall be made
without condition or reservation of right and free of set-off or counterclaim,
in Dollars and by wire transfer (pursuant to Agent's written wire transfer
instructions) of immediately available funds, to Agent, for the account of each
Lender, not later than 11:00 A.M. (Eastern time) on the date due; and funds
received by Agent after that time and date shall be deemed to have been paid on
the next succeeding Business Day.
2.6.3 PAYMENTS ON NON-BUSINESS DAYS. Whenever any payment to be
made by Borrower hereunder shall be stated to be due on a day which is not a
Business Day, payments shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the payment of
interest hereunder and of any of the fees specified in SECTION 2.5, as the case
may be.
2.7 INCREASED CAPITAL. If either (i) the introduction of or any change
in or in the interpretation of any law or regulation or (ii) compliance by Agent
or any Lender with any guideline or request from any central bank or other
Governmental Authority made or issued after the Closing Date affects or would
affect the amount of capital required or expected to be maintained by Agent or
such Lender or any corporation controlling Agent or such Lender, and Agent or
such Lender determines that the amount of such capital is increased by or based
upon the existence of Agent's obligations hereunder or such Lender's Commitment,
then, upon demand by Agent or such Lender, Borrower shall immediately pay to
Agent or such Lender, from time to time as specified by Agent or such Lender,
additional amounts sufficient to compensate Agent or such Lender in the light of
such circumstances, to the extent that Agent or such Lender determines such
increase in capital to be allocable to the existence of Agent's obligations
hereunder or such Lender's Commitment. A certificate as to such amounts
submitted to Borrower by Agent or such Lender shall, in the absence of manifest
error, be conclusive and binding for all purposes.
2.8 NOTICE OF INCREASED COSTS. Each Lender agrees that, as promptly as
reasonably practicable after it becomes aware of the occurrence of an event or
the existence of a condition which would cause it to be affected by any of the
events or conditions described in SECTION 2.4.7 or 2.4.8 or SECTION 2.7, it will
notify Borrower, and provide a copy of such notice to Agent, of such event and
the possible effects thereof, PROVIDED that the failure to provide such notice
shall not affect Lender's rights to reimbursement provided for herein.
ARTICLE III
UNENCUMBERED PROPERTIES AND PORTFOLIO PROPERTIES
3.1. LISTING OF UNENCUMBERED PROPERTIES. The Borrower represents and
warrants that each of the Properties listed on SCHEDULE 1 will on the Closing
Date satisfy all of the conditions set forth in the definition of Unencumbered
Property. From time to time during the term of this Agreement additional
Properties may become Unencumbered Properties and certain Properties which
previously satisfied the conditions set forth in the definition of Unencumbered
Property may cease to be Unencumbered Properties by virtue of property
dispositions, creation of Liens or other reasons. There shall be attached to
each Compliance Certificate delivered pursuant hereto an updated listing of the
Unencumbered Properties relied upon by the Borrower in computing the Value of
All Unencumbered Properties and the Unencumbered Net Operating Income stated in
such Compliance Certificate.
3.2. WAIVERS BY REQUISITE LENDERS. If any Property fails to satisfy
any of the requirements contained in the definition of Unencumbered Property
then the applicable Property may nevertheless be deemed to be Unencumbered
Property hereunder if the Requisite Lenders grant the necessary waivers and vote
to accept such Property as an Unencumbered Property.
3.3. REJECTION OF UNENCUMBERED PROPERTIES. If at any time the Agent
determines that any Property listed as an Unencumbered Property by the Borrower
does not satisfy all of the requirements of the definition of Unencumbered
Property (to the extent not waived by the Requisite Lenders pursuant to SECTION
3.2) it may reject an Unencumbered Property by notice to the Borrower and if the
Agent so requests the Borrower shall revise the applicable Compliance
Certificate to reflect the resulting change in the Value of All Unencumbered
Properties and the Unencumbered Net Operating Income.
3.4 UPDATED LISTS OF UNENCUMBERED PROPERTIES AND PORTFOLIO PROPERTIES.
SCHEDULE 1 contains a list of the Unencumbered Properties and SCHEDULE 1.1 sets
forth a list of the Portfolio Properties (other than the Unencumbered
Properties) each as of the date hereof. Promptly upon the acquisition or
disposition of any of the Portfolio Properties and promptly upon the creation of
any Lien or other event which causes any of the Portfolio Properties which
previously qualified as an Unencumbered Property to no longer satisfy the
definition of Unencumbered Property, Borrower shall deliver to Agent an updated
SCHEDULE 1 and/or SCHEDULE 1.1 and any other information as may be reasonably
requested by Agent relating to such change in the list of Unencumbered
Properties and/or Portfolio Properties, including a Compliance Certificate.
ARTICLE IV
CONDITIONS TO LOANS
4.1 CONDITIONS TO DISBURSEMENT OF LOANS. The obligation of Lenders to
make the disbursement of the Loans on the Closing Date shall be subject to
satisfaction of each of the following conditions precedent, provided, however
that if evidence of qualification and good standing is not available from all
required states by the Closing Date, the Agent may permit such evidence to be
delivered a reasonable time after the Closing Date:
4.1.1 BORROWER DOCUMENTS. Borrower shall have executed and/or
delivered to Agent each of the following, in form and substance acceptable to
Agent:
(a) this Agreement;
(b) the Loan Notes;
(c) Certified copy of Borrower's Limited
Partnership Agreement, as amended;
(d) Certified copy of Borrower's Certificate of
Limited Partnership from the Delaware Secretary
of State;
(e) Evidence of qualification and good standing of
Borrower in Delaware and in each state
where any Unencumbered Property is located.
4.1.2 REIT DOCUMENTS. The REIT shall have executed and/or
delivered to Agent each of the following, in form and substance acceptable to
Agent:
(a) The Guaranty
(b) Articles of Incorporation, as amended, of the
REIT, as certified by the Secretary of State of
Maryland;
(c) By-laws of the REIT as certified by the
Secretary of the REIT;
(d) Good Standing Certificate for the REIT from
the Secretary of State of Maryland;
(e) Evidence of qualification and good standing of
the REIT in each state where any Unencumbered
Property is located;
(f) Certificate of Secretary regarding corporate
resolutions of the REIT, and the incumbency of
its officers as certified by the Secretary of
the REIT.
4.1.3 COMPLIANCE CERTIFICATE. Borrower shall have delivered to
Agent a Compliance Certificate demonstrating compliance with the financial
covenants in ARTICLE IX on the Closing Date.
4.1.4 MATERIAL ADVERSE CHANGES. No change (other than as
reflected in the Prior Financials), as determined by Agent shall have occurred,
during the period commencing December 31, 1997, and ending on the Closing Date,
which has a Material Adverse Effect on Borrower or the REIT.
4.1.5 LITIGATION PROCEEDINGS. There shall not have been
instituted or threatened, during the period commencing December 31, 1997, and
ending on the Closing Date, any litigation or proceeding in any court or
Governmental Authority affecting or threatening to affect Borrower or the REIT
which has a Material Adverse Effect, as reasonably determined by Agent.
4.1.6 NO EVENT OF DEFAULT; SATISFACTION OF FINANCIAL COVENANTS.
On the Closing Date, no Event of Default or Unmatured Event of Default shall
exist and all of the financial covenants contained in ARTICLE IX shall be
satisfied.
4.1.7 FEES. Agent shall have received the facility fee required
by SECTION 2.5.1, certain fees in the amount separately agreed to in the Fee
Letter between Agent and Borrower, and all expenses of Agent incurred prior to
such Closing Date in connection with this Agreement (including without
limitation all attorneys' fees and costs), shall have been paid by Borrower. The
Agent shall pay to each Lender its Pro Rata Share of the facility fee.
4.1.8 OPINION OF COUNSEL. Agent shall have received, on behalf of
Agent and Lenders, favorable opinions of counsel for Borrower and the REIT dated
as of the Closing Date, in form and substance satisfactory to Agent. 4.1.9
REPRESENTATIONS AND WARRANTIES. All representations and warranties contained in
this Agreement and the other Loan Documents shall be true and correct in all
material respects.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to make the Loans, Borrower hereby represents and
warrants to Lenders as follows:
5.1 BORROWER ORGANIZATION; PARTNERSHIP POWERS. Borrower (i) is a
limited partnership duly organized, validly existing and in good standing under
the laws of the State of Delaware, (ii) is duly qualified to do business as a
foreign limited partnership and in good standing under the laws of each
jurisdiction in which any Portfolio Property is located or in which Borrower
owns or leases real property or in which the nature of its business requires it
to be so qualified, except for those jurisdictions where failure to so qualify
and be in good standing would not have a Material Adverse Effect on Borrower,
and (iii) has all requisite partnership power and authority to own and operate
its property and assets and to conduct its business as presently conducted.
5.2 BORROWER AUTHORITY. Borrower has the requisite partnership power
and authority to execute, deliver and perform each of the Loan Documents to
which it is or will be a party. The execution, delivery and performance thereof,
and the consummation of the transactions contemplated thereby, have been duly
approved by the general partner of Borrower, and no other partnership
proceedings or authorizations on the part of Borrower or its general or limited
partners are necessary to consummate such transactions. Each of the Loan
Documents to which Borrower is a party has been duly executed and delivered by
Borrower and constitutes its legal, valid and binding obligation, enforceable
against it in accordance with its terms, subject to bankruptcy, insolvency and
other laws affecting creditors' rights generally.
5.3 REIT ORGANIZATION; CORPORATE POWERS. The REIT (i) is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Maryland, (ii) is duly qualified to do business as a foreign
corporation and in good standing under the laws of each jurisdiction in which
any Portfolio Property is located or in which Borrower or the REIT owns or
leases real property or in which the nature of its business requires it to be so
qualified, except for those jurisdictions where failure to so qualify and be in
good standing would not have a Material Adverse Effect on the REIT, and (iii)
has all requisite corporate power and authority to own and operate its property
and assets, to perform its duties as general partner of Borrower and to conduct
its business as presently conducted.
5.4 REIT AUTHORITY. The REIT has the requisite corporate power and
authority to execute, deliver and perform the Guaranty and, in its capacity as
general partner of the Borrower, each of the other Loan Documents. The
execution, delivery and performance thereof, and the consummation of the
transactions contemplated thereby, have been duly approved by the Board of
Directors of the REIT, and no other corporate proceedings on the part of the
REIT are necessary to consummate such transactions. Each of the Loan Documents
to which the REIT is a party has been duly executed and delivered by Borrower
and constitutes its legal, valid and binding obligation, enforceable against it
in accordance with its terms, subject to bankruptcy, insolvency and other laws
affecting creditors' rights generally.
5.5 OWNERSHIP OF BORROWER, EACH SUBSIDIARY AND PARTNERSHIP. SCHEDULE
5.5 sets forth the general partners and limited partners (or other holders of
ownership interests) of each Subsidiary or Partnership and their respective
ownership percentages and there are no other partnership (or other ownership)
interests outstanding. Except as set forth or referred to in the Partnership
Agreement of any Partnership, no partnership (or other ownership) interest (or
any securities, instruments, warrants, option or purchase rights, conversion or
exchange rights, calls, commitments or claims of any character convertible into
or exercisable for such interests) of any such Person is subject to issuance
under any security, instrument, warrant, option or purchase rights, conversion
or exchange rights, call, commitment or claim of any right, title or interest
therein or thereto. All of the partnership (or other ownership) interests in
Borrower and each Partnership and all of the stock of each subsidiary have been
issued in compliance with all applicable Requirements of Law.
5.6 NO CONFLICT. The execution, delivery and performance by Borrower
of the Loan Documents to which it is or will be a party, and each of the
transactions contemplated thereby, do not and will not (i) conflict with or
violate Borrower's limited partnership agreement or certificate of limited
partnership or other organizational documents or the REIT's articles of
incorporation, by-laws or other organizational documents, as the case may be, or
(ii) conflict with, result in a breach of or constitute (with or without notice
or lapse of time or both) a default under any Requirement of Law, Contractual
Obligation or Court Order of or binding upon Borrower or the REIT, or (iii)
require termination of any Contractual Obligation, or (iv) result in or require
the creation or imposition of any Lien whatsoever upon any of the Portfolio
Properties or assets of Borrower, other than Permitted Liens or Liens created by
the Loan Documents.
5.7 CONSENTS AND AUTHORIZATIONS. Each of Borrower and the REIT has
obtained all consents and authorizations required pursuant to its Contractual
Obligations with any other Person, and shall have obtained all consents and
authorizations of, and effected all notices to and filings with, any
Governmental Authority, as may be necessary to allow Borrower and the REIT to
lawfully execute, deliver and perform the Loan Documents.
5.8 GOVERNMENTAL REGULATION. Neither Borrower, the REIT nor any
Partnership is subject to regulation under the Public Utility Holding Company
Act of 1935, the Federal Power Act, the Interstate Commerce Act, the Investment
Company Act of 1940 or any other federal or state statute or regulation such
that its ability to incur indebtedness is limited or its ability to consummate
the transactions contemplated by the Loan Documents is materially impaired.
5.9 PRIOR FINANCIALS. The Consolidated Balance Sheet, Statement of
operations and Statement of Cash Flows of (i) the REIT contained in the REIT's
Form 10K for the period ending December 31, 1997 and in the REIT's Form 10Q for
the period ending June 30, 1998 and (ii) the Borrower contained in the
Borrower's Form 10K for the period ending December 31, 1997 and in the
Borrower's Form 10Q for the period ending June 30, 1998 (the APRIOR FINANCIALS")
delivered to Agent prior to the date hereof were prepared in accordance with
GAAP and fairly present the assets, liabilities and financial condition of the
REIT on a consolidated basis, at such date and the results of its operations and
its cash flows, on a consolidated basis, for the period then ended.
5.10 PROJECTIONS AND FORECASTS. Each of the projections and forecasts
delivered to Agent prior to the date hereof (1) has been prepared by Borrower in
light of the past business and performance of Borrower on a consolidated basis
and (2) represent as of the date thereof, the reasonable good faith estimates of
Borrower's financial personnel.
5.11 PRIOR OPERATING STATEMENTS. Each of the consolidating operating
statements pertaining to the Portfolio Properties delivered to Agent prior to
the date hereof was prepared in accordance with GAAP in effect on the date such
operating statement of each Portfolio Property was prepared and fairly presents
the results of operations of such Portfolio Property for the period then ended.
5.12 RENT ROLLS. The Rent Rolls for the Portfolio Properties as of
June 30, 1998 previously delivered to the Agent pursuant to the Revolving
Facility (i) have been prepared in accordance with the books and records of the
Portfolio Properties, and (ii) fairly present the leasing status of the
Portfolio Properties as of the date thereof. Since the date of said Rent Rolls
there has been no substantial adverse change to the leasing status of the
Portfolio Properties.
5.13 LITIGATION; ADVERSE EFFECTS.
(a) There is no action, suit, Proceeding,
governmental investigation or arbitration, at law or in equity,
or before or by any Governmental Authority, pending or, to the
best of Borrower's knowledge, threatened against Borrower, the REIT or
any Portfolio Property, which, if adversely determined, would (i)
result in a Material Adverse Effect on Borrower or the REIT, (ii)
materially and adversely affect the ability of any party to any of the
Loan Documents to perform its obligations thereunder, or (iii)
materially and adversely affect the ability of Borrower to perform its
obligations contemplated in the Loan Documents.
(b) Neither Borrower nor the REIT is (1) in
violation of any applicable law, which violation has a Material
Adverse Effect on Borrower or the REIT, or (ii) in default with respect
to any Court Order.
5.14 NO MATERIAL ADVERSE CHANGE. Since December 31, 1997, there has
occurred no event (other than as reflected in the Prior Financials) which has a
Material Adverse Effect on Borrower or the REIT, and no material adverse change
in Borrower's ability to perform its obligations under the Loan Documents to
which it is a party or the transactions contemplated thereby.
5.15 PAYMENT OF TAXES. All tax returns and reports to be filed by
Borrower and the REIT have been timely filed, and all taxes, assessments, fees
and other governmental charges shown on such returns or otherwise payable by
Borrower have been paid when due and payable (other than real property taxes,
which may be paid prior to delinquency so long as no penalty or interest shall
attach thereto), except such taxes, if any, as are reserved against in
accordance with GAAP and are being contested in good faith by appropriate
proceedings or such taxes, the failure to make payment of which when due and
payable will not have, in the aggregate, a Material Adverse Effect on Borrower
or the REIT. Borrower has no knowledge of any proposed tax assessment against
Borrower or the REIT that will have a Material Adverse Effect on Borrower or the
REIT.
5.16 MATERIAL ADVERSE AGREEMENTS. Neither the Borrower nor the REIT is
a party to or subject to any Contractual Obligation or other restriction
contained in the Borrower's limited partnership agreement or certificate of
limited partnership, the REIT's Articles of Incorporation or bylaws or similar
governing documents which has a Material Adverse Effect on Borrower or the
ability of Borrower to perform its obligations under the Loan Documents.
5.17 PERFORMANCE. Neither Borrower nor the REIT is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any Contractual Obligation applicable to it, and no
condition exists which, with the giving of notice or the lapse of time or both,
would constitute a default under such Contractual Obligation in each case,
except where the consequences, direct or indirect, of such default or defaults,
if any, will not have a Material Adverse Effect on Borrower or the REIT.
5.18 FEDERAL RESERVE REGULATIONS. Neither Borrower nor the REIT is
engaged primarily in the business of extending credit for the purpose of
purchasing or carrying any "margin stock" as defined in Regulation U. No part of
the proceeds of the Loan hereunder will be used for any purpose that violates,
or which is inconsistent with, the provisions of Regulation X or any other
regulation of the Federal Reserve Board.
5.19 UNSECURED TERM NOTES. The Unsecured Term Notes were issued in
compliance with all applicable Requirements of Law and there is no existing
"Event of Default" as defined in the Unsecured Term Note Indenture. There have
been no further supplements or amendments to the Unsecured Term Note Indenture
except as set forth in the definition of Unsecured Term Note Indenture.
5.20 REQUIREMENTS OF LAW. Borrower and the REIT are in compliance with
all Requirements of Law (including without limitation the Securities Act and the
Securities Exchange Act, and the applicable rules and regulations thereunder,
state securities law and "Blue Sky" laws) applicable to it and its respective
businesses, in each case, where the failure to so comply will have a Material
Adverse Effect on any such Person. The REIT has made all filings with and
obtained all consents of the Commission required under the Securities Act and
the Securities Exchange Act in connection with the execution, delivery and
performance by the REIT of the Loan Documents.
5.21 PATENTS, TRADEMARKS, PERMITS, ETC. Borrower and the REIT own, are
licensed or otherwise have the lawful right to use, or have all permits and
other governmental approvals, patents, trademarks, trade names, copyrights,
technology, know-how and processes used in or necessary for the conduct of each
such Person's business as currently conducted, the absence of which would have a
Material Adverse Effect upon such Person. The use of such permits and other
governmental approvals, patents, trademarks, trade names, copyrights,
technology, know-how and processes by each such Person does not infringe on the
rights of any Person, subject to such claims and infringements as do not, in the
aggregate, give rise to any liability on the part of any such Person which would
have a Material Adverse Effect on any such Person.
5.22 ENVIRONMENTAL MATTERS. Except as set forth on SCHEDULE 5.22, to
the best of Borrower's knowledge, (i) the operations of Borrower and its
Subsidiaries and Partnerships and the Simon Partnerships comply in all material
respects with all applicable local, state and federal environmental, health and
safety Requirements of Law ("ENVIRONMENTAL LAWS"); (ii) none of the Portfolio
Properties or the Simon Properties are subject to any Remedial Action or other
Liabilities and Costs arising from the Release or threatened Release of a
Contaminant into the environment in violation of any Environmental Laws; (iii)
neither Borrower, the REIT nor any Partnership or Subsidiary has filed any
notice under applicable Environmental Laws reporting a Release of a Contaminant
into the environment in violation of any Environmental Laws, except as the same
may have been heretofore remedied; (iv) there is not now on or in any of the
Portfolio Properties or the Simon Properties (except in compliance in all
material respects with all applicable Environmental Laws): (A) any underground
storage tanks, (B) any asbestos-containing material, or (C) any polychlorinated
biphenyls (PCB's) used in hydraulic oils, electrical transformers or other
equipment owned by such Person; and (v) neither Borrower, the REIT nor any
Partnership or Subsidiary has received any notice or claim to the effect that it
is or may be liable to any Person as a result of the Release or threatened
Release of a Contaminant into the environment.
5.23 UNENCUMBERED PROPERTIES. Each of the Properties listed on
SCHEDULE 1 (i) qualifies as an Unencumbered Property (ii) has a Property
Occupancy Rate of at least eighty-five percent (85%) and (iii) is free of any
material defects in the roof, foundation, structural elements and masonry walls
of the buildings thereon or their hvac, electrical, sprinkler or plumbing
systems.
5.24 SOLVENCY. Borrower is and will be Solvent after giving effect to
the disbursements of the Loans and the payment and accrual of all fees then
payable.
5.25 TITLE TO ASSETS; NO LIENS. Borrower has good, indefeasible and
merchantable title to all Properties owned or leased by it, and each of the
Unencumbered Properties is free and clear of all Liens, except Permitted Liens,
and there are no negative pledge agreements affecting any of the Unencumbered
Properties, except for SECTION 8.1 hereof and similar provisions in the
Revolving Credit Agreement and in the term loan agreement for the BankBoston
Term Loan.
5.26 USE OF PROCEEDS. Borrower's use of the proceeds of the Loans are,
and will continue to be, legal and proper uses (and to the extent necessary,
duly authorized by Borrower's partners) and such uses are consistent with all
applicable laws and statutes and SECTION 7.9.
5.27 REIT CAPITALIZATION. All of the capital stock of the REIT has
been issued in compliance with all applicable Requirements of Law.
5.28 ERISA. Neither the REIT nor any ERISA Affiliate thereof
(including, for all purposes under this SECTION 5.28, Borrower) has in the past
five (5) years maintained or contributed to or currently maintains or
contributes to any Benefit Plan. No Investment Partnership has or is likely to
incur any liability with respect to any Benefit Plan maintained or contributed
to by such Investment Partnership or its ERISA Affiliates, which would have a
Material Adverse Effect on Borrower. Neither the REIT nor any ERISA Affiliate
thereof has during the past five (5) years maintained or contributed to or
currently maintains or contributes to any employee welfare benefit plan within
the meaning of Section 3(1) of ERISA which provides benefits to retirees.
Neither the REIT nor any ERISA Affiliate thereof is now contributing nor has it
ever contributed to or been obligated to contribute to any Multiemployer Plan,
no employees or former employees of the REIT, or such ERISA Affiliate have been
covered by any Multiemployer Plan in respect of their employment by the REIT,
and no ERISA Affiliate of the REIT has or is likely to incur any withdrawal
liability with respect to any Multiemployer Plan which would have a Material
Adverse Effect on the REIT.
5.29 STATUS AS A REIT. The REIT (i) is a real estate investment trust
as defined in Section 856 of the Internal Revenue Code (or any successor
provision thereto), (ii) has not revoked its election to be a real estate
investment trust, (iii) has not engaged in any "prohibited transactions" as
defined in Section 856(b)(6)(iii) of the Internal Revenue Code (or any successor
provision thereto), and (iv) for its current "tax year" (as defined in the
Internal Revenue Code) is and for all prior tax years subsequent to its election
to be a real estate investment trust has been entitled to a dividends paid
deduction which meets the requirements of Section 857 of the Internal Revenue
Code.
5.30 OWNERSHIP. The REIT does not own or have any interest in any
other Person, other than its general partnership interests in Borrower and in
the ATC Partnership.
5.31 NYSE LISTING. The common stock of the REIT is and will continue
to be listed for trading on either the New York Stock Exchange or the American
Stock Exchange.
5.32 CURRENT CONSTRUCTION PROJECTS. SCHEDULE 5.32 sets forth a
description of all of the Current Construction Projects and all of the
Construction Projects presently planned for 1998 including with respect to each
project: its location, gross leasable area, total budgeted cost, construction
commencement date and expected Rent Stabilization Date which information shall
be deemed to be updated to reflect information set forth in Compliance
Certificates delivered to Agent.
5.33 YEAR 2000 COMPLIANCE. Borrower has (i) initiated a review and
assessment of all areas within its and each of its Affiliates' business and
operations (including those affected by suppliers and vendors) that could be
adversely affected by the "Year 2000 Problem" (that is, the risk that computer
applications used by the Borrower or any of its Affiliates (or its suppliers and
vendors) may be unable to recognize and perform properly date-sensitive
functions involving certain dates prior to and any date after December 31,
1999), (ii) developed a plan and timeline for addressing the Year 2000 Problem
on a timely basis, and (iii) to date, implemented that plan in accordance with
that timetable. The Borrower reasonably believes that all computer applications
(including those of its suppliers and vendors) that are material to its or any
of its Affiliates' business and operations will on a timely basis be able to
perform properly date-sensitive functions for all dates before and after January
1, 2000 (that is, be "Year 2000 Compliant"), except to the extent that a failure
to do so could not reasonably be expected to have a Material Adverse Effect.
ARTICLE VI
REPORTING COVENANTS
Borrower covenants and agrees that, on and after the date hereof,
until payment in full of all of the Obligations and termination of this
Agreement:
6.1 FINANCIAL STATEMENTS AND OTHER FINANCIAL AND OPERATING
INFORMATION. Borrower shall maintain or cause to be maintained a system of
accounting established and administered in accordance with sound business
practices and consistent with past practice to permit preparation of quarterly
and annual financial statements in conformity with GAAP, and each of the
financial statements described below shall be prepared on a consolidated basis
for the REIT and for the Borrower from such system and records. Borrower shall
deliver or cause to be delivered to Agent (with copies sufficient for each
Lender):
6.1.1 SEMI-ANNUAL RENT ROLLS. As soon as practicable, and in any
event within fifty (50) days after the end of each Fiscal Quarter ending on June
30 or December 31 rent rolls (on Borrower's detailed form of rent roll) for each
Portfolio Property dated as of the last day of such Fiscal Quarter, in form and
substance satisfactory to Agent, certified by the REIT's chief financial
officer, senior vice president or treasurer. Copies of the rent rolls will be
provided only to those Lenders which expressly request copies thereof.
6.1.2 QUARTERLY FINANCIAL STATEMENTS CERTIFIED BY CFO. As soon as
practicable, and in any event within fifty (50) days after the end of each of
the first three Fiscal Quarters, consolidated balance sheets, statements of
operations and statements of cash flow for the REIT and the Borrower ("FINANCIAL
STATEMENTS"), which may be in the form provided to the Commission on the REIT's
Form 10Q and the Borrower's Form 10Q (unless the Borrower is not required to
file a Form 10Q), and certified by the REIT's chief financial officer, senior
vice president or treasurer.
6.1.3 ANNUAL FINANCIAL STATEMENTS. Within ninety (90) days after
the close of each Fiscal Year, annual Financial Statements of the REIT and of
the Borrower, on a consolidated basis (in the form provided to the Commission on
the REIT's Form 10K and the Borrower's Form 10K), audited and certified without
qualification by the Accountants provided, however, that at such time as the
Borrower is no longer required to file a Form 10K with the Commission, Borrower
may deliver only the REIT's audited Financial Statement accompanied by a letter
from the Accountants stating that with the exception of the minority interest
line there is no material difference between the Financial Statements of
Borrower and such audited Financial Statements of the REIT. To the extent Agent
desires additional details or supporting information with respect to
Partnerships or individual Portfolio Properties or the Simon Properties not
contained in the REIT's or Borrower's Form 10K, Borrower shall provide Agent
with such details or supporting information as Agent requests which is
reasonably available to Borrower.
6.1.4 OFFICER'S CERTIFICATE. (i) Together with each delivery of
any Financial Statement pursuant to SECTIONS 6.1.2 and 6.1.3, (A) an Officer's
Certificate of the REIT stating that each of the Financial Statements delivered
to Agent therewith (i) has been prepared in accordance with the books and
records of the REIT and Borrower on a consolidated basis, and (ii) fairly
presents the financial condition of the REIT and Borrower on a consolidated
basis, at the dates thereof (and, if applicable, subject to normal year-end
adjustments) and the results of its operations and cash flows, on a consolidated
basis, for the period then ended; (B) an Officer's Certificate of the REIT,
stating that the executive officer who is the signatory thereto (which officer
shall be the chief executive officer, the chief operating officer, the chief
financial officer, any senior vice president or the treasurer of the REIT) has
reviewed, or caused under his supervision to be reviewed, the terms of this
Agreement and the other principal Loan Documents, and has made, or caused to be
made under his supervision, a review in reasonable detail of the transactions
and condition of Borrower and the REIT, during the accounting period covered by
such Financial Statements, and that such review has not disclosed the existence
during or at the end of such accounting period, and that the signers do not have
knowledge of the existence as of the date of the Officer's Certificate, of any
condition or event which constitutes an Event of Default or Unmatured Event of
Default, or, if any such condition or event existed or exists, specifying the
nature and period of existence thereof and what action has been taken, is being
taken and is proposed to be taken with respect thereto; and (C) a Compliance
Certificate demonstrating in reasonable detail (which detail shall include
actual calculation and supporting information) compliance during and at the end
of such accounting periods with the financial covenants contained in ARTICLE IX.
6.1.5 BORROWING PROJECTIONS. At least ten (10) days prior to the
end of each Fiscal Year, projections of Borrower, on a consolidated basis,
detailing expected borrowing and repayment of the loans under the Revolving
Facility for the following Fiscal Year together with an Officer's Certificate of
the REIT stating that such projections (1) have been prepared by Borrower in
light of the past business and performance of Borrower on a consolidated basis
and (2) represent, as of the date thereof, the reasonable good faith estimates
of Borrower's financial personnel. Borrower shall also provide such additional
supporting details as Agent may reasonably request.
6.1.6 COMPLIANCE WITH UNENCUMBERED PROPERTY REQUIREMENTS.
Promptly upon becoming aware of any condition or event which causes any of the
Properties listed as Unencumbered Properties on the most recent Compliance
Certificate to no longer comply with the requirements set forth in the
definition of Unencumbered Properties, an Officer's Certificate specifying the
relevant information and a revised Compliance Certificate.
6.1.7 KNOWLEDGE OF EVENT OF DEFAULT. Promptly upon Borrower
obtaining knowledge (i) of any condition or event which constitutes an Event of
Default or Unmatured Event of Default, or becoming aware that any Lender has
given notice or taken any other action with respect to a claimed Event of
Default or Unmatured Event of Default or (ii) of any condition or event which
has a Material Adverse Effect on Borrower or the REIT, an Officer's Certificate
specifying the nature and period of existence of any such condition or event, or
specifying the notice given or action taken by such Lender and the nature of
such claimed Event of Default, Unmatured Event of Default, event or condition,
and what action Borrower and/or the REIT has taken, is taking and proposes to
take with respect thereto.
6.1.8 LITIGATION, ARBITRATION OR GOVERNMENT INVESTIGATION.
Promptly upon Borrower or the REIT obtaining knowledge of (i) the institution
of, or threat of, any material action, suit, proceeding, governmental
investigation or arbitration against or affecting Borrower or the REIT not
previously disclosed in writing by Borrower to Agent pursuant to this SECTION
6.1.8, or (ii) any material development in any action, suit, proceeding,
governmental investigation or arbitration already disclosed, which, in either
case, has a Material Adverse Effect on Borrower or the REIT, a notice thereof to
Agent and such other information as may be reasonably available to it to enable
Agent, Lenders and their counsel to evaluate such matters.
6.1.9 ESTABLISHMENT OF BENEFIT PLAN AND INCREASE IN CONTRIBUTIONS
TO THE BENEFIT PLAN. Not less than ten (10) days prior to the effective date
thereof, a notice to Agent of the establishment of a Benefit Plan (or the
incurrence of any obligation to contribute to a Multiemployer Plan) by Borrower,
the REIT or any ERISA Affiliate. Within thirty (30) days after the first to
occur of an amendment of any then existing Benefit Plan of Borrower, the REIT or
any ERISA Affiliate which will result in an increase in the benefits under such
Benefit Plan or a notification of any such increase, or the establishment of any
new Benefit Plan by Borrower, the REIT or any ERISA Affiliate or the
commencement of contributions to any Benefit Plan to which Borrower, the REIT or
any ERISA Affiliate was not previously contributing, a copy of said amendment,
notification or Benefit Plan. For so long as any such Benefit Plan exists,
prompt notice of any Termination Event, prohibited transaction, funding waiver
request, unfavorable determination letter or withdrawal liability under a
Multiemployer Plan.
6.1.10 FAILURE OF THE REIT TO QUALIFY AS REAL ESTATE INVESTMENT
TRUST. Promptly upon, and in any event within forty-eight (48) hours after
Borrower first has actual knowledge of (i) the REIT failing to continue to
qualify as a real estate investment trust as defined in Section 856 of the
Internal Revenue Code (or any successor provision thereof), (ii) any act by the
REIT causing its election to be taxed as a real estate investment trust to be
terminated, (iii) any act causing the REIT to be subject to the taxes imposed by
Section 857(b)(6) of the Internal Revenue Code (or any successor provision
thereto), or (iv) the REIT failing to be entitled to a dividends paid deduction
which meets the requirements of Section 857 of the Internal Revenue Code, a
notice of any such occurrence or circumstance.
6.1.11 ASSET ACQUISITIONS AND DISPOSITIONS, INDEBTEDNESS, ETC.
Without limiting ARTICLE VIII or any other restriction in the Loan Documents,
and in all events not later than the same Business Day on which there is public
disclosure of any material Investments (other than in Cash Equivalents),
acquisitions, dispositions, disposals, divestitures or similar transactions
involving Property, the creation of Liens on any of the Portfolio Properties,
other than Non-Retail Properties, the execution of any long term leases of real
estate in which the Borrower or its Subsidiary is the lessee, the raising of
additional equity or the incurring or repayment of material Indebtedness, by or
with Borrower, any GP Partnership or Subsidiary or the REIT, telephonic or
facsimile notice thereof to Xxxx X. Xxxxx or such other person(s) as Agent may
designate from time to time, and, if requested by Agent, promptly upon
consummation of such transaction, a Compliance Certificate demonstrating in
reasonable detail (which detail shall include actual calculations) compliance,
after giving effect to such proposed transaction(s), with the covenants
contained in ARTICLE IX.
6.1.12 OTHER INFORMATION. Such other information, reports,
contracts, schedules, lists, documents, agreements and instruments in the
possession of the REIT or Borrower with respect to (i) the Portfolio Properties
or the Simon Properties, (ii) any material change in the REIT's investment,
finance or operating policies, or (iii) Borrower's or the REIT's business,
condition (financial or otherwise), operations, performance, properties or
prospects as Agent may from time to time reasonably request, including, without
limitation, annual information with respect to cash flow projections, budgets,
operating statements (current year and immediately preceding year), rent rolls,
lease expiration reports, leasing status reports, tenant sales reports (to the
extent available), note payable summaries, equity funding requirements,
contingent liability summaries, line of credit summaries, tenant improvement
allowance summaries, note receivable summaries, schedules of outstanding letters
of credit, summaries of cash and Cash Equivalents, projections of management and
leasing fees and overhead budgets. Provided that Agent gives Borrower reasonable
prior notice and an opportunity to participate, Borrower hereby authorizes Agent
to communicate with the Accountants and authorizes the Accountants to disclose
to Agent any and all financial statements and other information of any kind,
including copies of any management letter or the substance of any oral
information, that such accountants may have with respect to Borrower's or the
REIT's condition (financial or otherwise), operations, properties, performance
and prospects. At Agent's request, Borrower shall deliver a letter addressed to
the Accountants instructing them to disclose such information in compliance with
this SECTION 6.1.12.
6.1.13 PRESS RELEASES; SEC FILINGS AND FINANCIAL STATEMENTS.
Telephonic or telecopy notice to Agent concurrent with or prior to issuance of
any material press release concerning the REIT or Borrower and, as soon as
practicable after filing with the Commission, all reports and notices, proxy
statements, registration statements and prospectuses of the REIT. All materials
sent or made available generally by the REIT to the holders of its publicly-held
Securities or to a trustee under any indenture or filed with the Commission,
including all periodic reports required to be filed with the commission, will be
delivered to Agent and Lenders as soon as available.
6.1.14 ACCOUNTANT REPORTS. Copies of all reports prepared by the
Accountants and submitted to Borrower or the REIT in connection with each
annual, interim or special audit or review of the financial statements or
practices of Borrower or the REIT, including the comment letter submitted by the
Accountants in connection with their annual audit.
6.1.15 TERMINATION OR MODIFICATION OF EARTHQUAKE COVERAGE.
Promptly upon, and in any event within thirty (30) days after Borrower first has
knowledge of the termination or modification (with respect to the amount of
either the coverage provided or the applicable deductible) of the coverage
provided by the blanket property insurance rider regarding earthquake insurance
for Portfolio Properties located in "Zone 1" maintained by Borrower as of the
date of this Agreement, a notice of such termination or modification.
6.1.16 YEAR 2000 PROBLEM. Promptly upon Borrower obtaining
knowledge that any computer application (including those of its suppliers and
vendors) that is material to its or any of its Affiliates' business and
operations will not be Year 2000 Compliant on a timely basis, (except to the
extent that such failure could not reasonably be expected to have a Material
Adverse Effect) a notice thereof to Agent and such other information as may be
reasonably available to enable Agent and Lenders to evaluate such matters.
6.1.17 DELIVERIES TO THE AGENT AND THE LENDERS. For so long as
BankBoston is both the Agent under the Revolving Credit Agreement and the Agent
hereunder, it may consider any item delivered to it as Agent pursuant to the
Revolving Credit Agreement to also constitute a delivery to it as Agent
hereunder, provided that Agent may also require that separate or duplicate
documents be delivered hereunder. For so long as any Lender hereunder is also a
lender under the Revolving Credit Agreement it may consider any item delivered
to it as a lender pursuant to the Revolving Credit Agreement to also constitute
a delivery to it as a Lender hereunder, provided that any Lender may also
require that separate or duplicate documents be delivered hereunder.
6.2 ENVIRONMENTAL NOTICES. Borrower shall notify Agent, in writing, as
soon as practicable, and in any event within ten (10) days after Borrower's or
the REIT's learning thereof, of any: (i) written notice or claim to the effect
that Borrower or the REIT is or may be liable to any Person as a result of any
material Release or threatened Release of any Contaminant into the environment;
(ii) written notice that Borrower or the REIT is subject to investigation by any
Governmental Authority evaluating whether any Remedial Action is needed to
respond to the Release or threatened Release of any Contaminant into the
environment; (iii) written notice that any Portfolio Property or any Simon
Property is subject to an Environmental Lien; (iv) written notice that Borrower,
any Subsidiary or Partnership, any Simon Partnership or the REIT has received a
notice of violation of any Environmental Laws by Borrower, any Subsidiary or
Partnership or the REIT; (v) commencement or written threat of any judicial or
administrative proceeding alleging a violation of any Environmental Laws; (vi)
written notice from a Governmental Authority of any changes to any existing
Environmental Laws that will have a Material Adverse Effect on the operations of
Borrower or the REIT; or (vii) any proposed acquisition of stock, assets, real
estate or leasing of property, or any other action by Borrower that, to the best
of Borrower's knowledge, could subject Borrower, any Subsidiary or Partnership
or the REIT to environmental, health or safety Liabilities and Costs that will
have a Material Adverse Effect on Borrower or the REIT.
6.3 CONFIDENTIALITY. Confidential Information obtained by Agent or
Lenders pursuant to this Agreement or in connection with the Facility shall not
be disseminated by Agent or Lenders and shall not be disclosed to third parties
except to regulators, taxing authorities and other governmental agencies having
jurisdiction over Agent or such Lender or otherwise in response to Requirements
of Law, to their respective auditors and legal counsel and in connection with
regulatory, administrative and judicial proceedings as necessary or relevant
including enforcement proceedings relating to the Loan Documents, and to any
prospective assignee of or participant in a Lender's interest under this
Agreement or any prospective purchaser of the assets or a controlling interest
in any Lender, PROVIDED that such prospective assignee, participant or purchaser
first agrees to be bound by the provisions of this SECTION 6.3. For purposes
hereof, "CONFIDENTIAL INFORMATION" shall mean all nonpublic information obtained
by Agent or Lenders, unless and until such information becomes publicly known,
other than as a result of unauthorized disclosure by Agent or Lenders of such
information.
ARTICLE VII
AFFIRMATIVE COVENANTS
Borrower covenants and agrees that, on and after the date hereof,
until payment in full of all of the Obligations and termination of this
Agreement:
7.1 EXISTENCE. Each of Borrower and the REIT shall at all times
maintain its existence and preserve and keep in full force and effect its rights
and franchises. Borrower shall remain a Delaware limited partnership with the
REIT as its sole general partner.
7.2 QUALIFICATION, NAME. Each of Borrower and the REIT shall qualify
and remain qualified to do business in each jurisdiction in which any Portfolio
Property is located or in which the nature of its business requires it to be so
qualified except for those jurisdictions where failure to so qualify would not
have a material Adverse Effect on Borrower. Borrower will transact business
solely in its own name or in the commonly known name of one of the Portfolio
Properties.
7.3 COMPLIANCE WITH LAWS, ETC. Each of Borrower and REIT shall (i)
comply with all Requirements of Law, and all restrictive covenants affecting it
or its properties, performance, prospects, assets or operations, and (ii) obtain
as needed all Permits necessary for its operations and maintain such in good
standing, except where the failure to do so will not have a Material Adverse
Effect on Borrower.
7.4 PAYMENT OF TAXES AND CLAIMS. Each of Borrower and the REIT shall
pay (i) all taxes, assessments and other governmental charges imposed upon it or
on any of its properties or assets or in respect of any of its franchises,
business, income or property before any penalty or interest accrues thereon, and
(ii) all claims (including, without limitation, claims for labor, services,
materials and supplies) for sums which have become due and payable and which by
law have or may become a Lien other than a judgment lien upon any of Borrower's
properties or assets, prior to the time when any penalty or fine shall be
incurred with respect thereto, provided, however that the payment of such taxes,
assessments, charges and claims may be deferred so long as the validity or
amount thereof shall currently be contested in good faith by appropriate
proceedings and if Borrower shall have set aside in its books adequate reserves
specifically with respect thereto, but Borrower shall pay such matters prior to
the foreclosure of a Lien which may have attached as security therefor.
7.5 MAINTENANCE OF PROPERTIES; INSURANCE. Borrower shall maintain in
good repair, working order and condition, excepting ordinary wear and tear, all
of the Portfolio Properties and will make or cause to be made all appropriate
repairs, renewals and replacements thereof. Borrower shall maintain commercially
reasonable and appropriate amounts of "all risk" property and liability
insurance, which insurance shall include in any event:
(a) with respect to each Property: (i) property and casualty
insurance (including coverage for flood and water damage for any
Portfolio Property located within a 100-year flood plain) in an amount
not less than the replacement costs of the improvements thereon (subject
to reasonable deductibles and, in the case of flood insurance, subject to
the maximum coverages available under the National Flood Insurance
Program), and (ii) loss of rental insurance income in an amount not less
than one year's gross revenues of such Portfolio Property; and
(b) comprehensive general liability insurance in an amount not
less than $20,000,000 per occurrence, including all insurance pursuant to
umbrella and excess liability policies.
At the request of Agent, Borrower shall provide, evidence of insurance,
including certificates of insurance and binders.
7.6 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS. Borrower
shall permit, and shall cause the REIT and each Subsidiary or Partnership to
permit, any authorized representative(s) designated by any Lender to visit and
inspect any of its properties, to inspect financial and accounting records and
leases, and to make copies and take extracts therefrom, all at such times after
reasonable advance notice during normal business hours and as often as any
Lender may reasonably request. In connection therewith, Borrower shall pay all
expenses of the Agent (but not of the other Lenders) of the types described in
SECTION 12.1 subject to the limitation that prior to an Event of Default the
Borrower shall not be required to reimburse expenses for inspections of
Properties made more frequently than annually. Borrower will keep proper books
of record and account in which entries, in conformity with GAAP and as otherwise
required by this Agreement and applicable Requirements of Law, shall be made of
all dealings and transactions in relation to its businesses and activities and
as otherwise required under SECTION 6.1.
7.7 MAINTENANCE OF PERMITS, ETC. Each of Borrower and the REIT will
maintain in full force and effect all Permits, franchises, patents, trademarks,
trade names, copyrights, authorizations or other rights necessary for the
operation of its business, except where the failure to obtain any of the
foregoing would not have a Material Adverse Effect on Borrower; and notify Agent
in writing, promptly after learning thereof, of the suspension, cancellation,
revocation or discontinuance of or of any pending or threatened action or
proceeding seeking to suspend, cancel, revoke or discontinue any material
Permit, patent, trademark, trade name, copyright, governmental approval,
franchise authorization or right.
7.8 CONDUCT OF BUSINESS. Except for Permitted Investments pursuant to
SECTION 9.10 and Investments in cash and Cash Equivalents, Borrower shall engage
only in the business of direct ownership, operation and development of retail
properties and any other business activities of Borrower will remain incidental
thereto.
7.9 USE OF PROCEEDS. Borrower shall use the proceeds of the Loans only
for repayment of loans outstanding under the Revolving Facility.
7.10 SECURITIES LAW COMPLIANCE. Each of the Borrower and the REIT
shall comply in all material respects with all rules and regulations of the
Commission and file all reports required by the Commission relating to the
Borrower's or the REIT's publicly-held Securities.
7.11 CONTINUED STATUS AS A REIT; PROHIBITED TRANSACTIONS. The REIT (i)
will continue to be a real estate investment trust as defined in Section 856 of
the Internal Revenue Code (or any successor provision thereto), (ii) will not
revoke its election to be a real estate investment trust, (iii) will not engage
in any "prohibited transactions" as defined in Section 856(b)(6)(iii) of the
Internal Revenue Code (or any successor provision thereto), and (iv) will
continue to be entitled to a dividend paid deduction meeting the requirements of
Section 857 of the Internal Revenue Code.
7.12 NYSE LISTED COMPANY. The common stock of the REIT shall at all
times be listed for trading on the New York Stock Exchange.
7.13 PROPERTY MANAGEMENT. All Portfolio Properties (other than
Non-Retail Properties) in which the direct or indirect ownership interest of
Borrower exceeds fifty percent (50%) shall be directly managed by Borrower.
7.14 INTEREST RATE CONTRACTS. At all times when LIBOR for 30 day
Interest Periods has, for 30 consecutive days, exceeded eight and one-quarter
percent (8.25%), Borrower shall maintain in effect Interest Rate Contracts which
are satisfactory to the Agent covering at least forty percent (40%) of the
aggregate amount of variable interest rate Indebtedness of Borrower (including
the Facility, the Revolving Facility and the BankBoston Term Loan) then
outstanding plus any additional loans under the Revolving Facility which are
projected to be advanced thereunder within 90 days after the acquisition of such
Interest Rate Contracts. In determining whether such Interest Rate Contracts are
satisfactory, the Agent shall not require that the terms thereof extend beyond
the Termination Date.
ARTICLE VIII
NEGATIVE COVENANTS
Borrower covenants and agrees that, on and after the date hereof,
until payment in full of all of the Obligations and termination of this
Agreement:
8.1 LIENS. Neither Borrower nor the REIT shall(i) directly or
indirectly create, incur, assume or permit to exist any Lien, except for
Permitted Liens, on or with respect to all or any portion of Woodbury Common;
(ii) directly or indirectly create, assume or permit to exist any agreement
(other than the Loan Documents and the Unsecured Term Note Secured Debt
Limitation set forth in the Unsecured Term Note Indenture) prohibiting the
creation of any Lien on Woodbury Common. This SECTION 8.1 shall only be
applicable so long as Borrower's senior long-term unsecured debt obligations are
rated below BBB or Baa2 by one or both of the Rating Agencies.
8.2 TRANSFERS OF WOODBURY COMMON. Borrower shall not transfer,
directly or indirectly, all or any interest in Woodbury Common except Leases to
tenants which are not Affiliates of Borrower entered into in the ordinary course
of business.
8.3 RESTRICTIONS ON FUNDAMENTAL CHANGES. Neither Borrower nor the REIT
shall, without the prior written consent of the Agent
(a) Enter into any merger or consolidation or liquidate, wind-up
or dissolve (or suffer any liquidation or dissolution);
(b) Change its Fiscal Year;
(c) Except for Permitted Investments, engage in any line of
business other than as expressly permitted under SECTION 7.8;
(d) Create or acquire any Subsidiary or become a partner or
member in any Partnership (except a Simon Partnership) PROVIDED, however
that the Agent shall not unreasonably withhold its consent under this
paragraph (d) after a review of all information requested by the Agent
regarding the applicable entity including the names of others having an
ownership interest therein, the proposed structure of the entity, the
size, location and leasing of the Property owned or proposed to be owned
by such entity and the terms of any existing or contemplated Indebtedness
of such entity.
8.4 ERISA. Neither the Borrower nor the REIT shall permit any ERISA
Affiliates to do any of the following to the extent that such act or failure to
act would result in the aggregate, after taking into account any other such acts
or failure to act, in a Material Adverse Effect on Borrower or the REIT:
(a) Engage, or knowingly permit an ERISA Affiliate to engage, in
any prohibited transaction described in Section 406 of the ERISA or
Section 4975 of the Internal Revenue Code which is not exempt under
Section 407 or 408 of ERISA or Section 4975(d) of the Internal Revenue
Code for which a class exemption is not available or a private exemption
has not been previously obtained from the DOL;
(b) Permit to exist any accumulated funding deficiency (as
defined in Section 302 of ERISA and Section 412 of the Internal Revenue
Code), whether or not waived;
(c) Fail, or permit an ERISA Affiliate to fail, to pay timely
required contributions or annual installments due with respect to any
waived funding deficiency to any Plan if such failure could result in the
imposition of a Lien or otherwise would have a Material Adverse Effect on
Borrower or the REIT;
(d) Terminate, or permit an ERISA Affiliate to terminate, any
Benefit Plan which would result in any liability of Borrower or an ERISA
Affiliate under Title IV of ERISA or the REIT; or
(e) Fail, or permit any ERISA Affiliate to fail, to pay any
required installment under section (m) of Section 412 of the Internal
Revenue Code or any other payment required under Section 412 of the
Internal Revenue Code on or before the due date for such installment or
other payment, if such failure could result in the imposition of a Lien
or otherwise would have a Material Adverse Effect on Borrower or the
REIT.
8.5 AMENDMENT OF CONSTITUENT DOCUMENTS. Except for any such amendment
that is required (i) under any Requirement of Law imposed by any Governmental
Authority or (ii) in order to maintain compliance with SECTION 7.11: (1) neither
Borrower nor any Partnership shall amend its Partnership Agreement (including,
without limitation, as to the admission of any new partner, directly or
indirectly), and (2) the REIT shall not amend its articles of incorporation or
by-laws; in any such case, except amendments which do not materially affect the
ability of the Borrower or the REIT to perform its obligations under the Loan
Documents or other amendments which have received the prior written consent of
the Agent.
8.6 DISPOSAL OF PARTNERSHIP INTERESTS OR STOCK IN SUBSIDIARIES.
Neither Borrower nor the REIT will directly or indirectly convey, sell,
transfer, assign, pledge or otherwise encumber or dispose of any of its
partnership (or other ownership) interests or stock in any Partnership or
Subsidiary without first providing the notice and (if required) Compliance
Certificate pursuant to SECTION 6.1.11 with such disposition or encumbrance of
such partnership interest or stock being treated the same as disposition or
encumbrance of the Property owned by the applicable Partnership or Subsidiary.
8.7 MARGIN REGULATIONS. No portion of the proceeds of any Loans shall
be used in any manner which might cause the extension of credit or the
application of such proceeds to violate Regulation U or X or any other
regulation of the Federal Reserve Board or to violate the Securities Exchange
Act or the Securities Act, in each case as in effect on the Closing Date.
8.8 WITH RESPECT TO THE REIT:
8.8.1 The REIT shall not own any material assets (other than its
interest in the ATC Partnership) or engage in any line of business other than
owning partnership interests in Borrower.
8.8.2 The REIT shall not directly or indirectly create, incur,
assume or otherwise become or remain directly or indirectly liable with respect
to, any Indebtedness, except the Obligations and other Borrower Debt.
8.8.3 The REIT shall not directly or indirectly create, incur,
assume or permit to exist any Lien (other than Permitted Liens) on or with
respect to any of its Property or assets.
8.8.4 The REIT will not directly or indirectly convey, sell,
transfer, assign, pledge or otherwise encumber or dispose of any of its
partnership interests in Borrower so as to reduce its interest in Borrower to
less than 60%.
8.9 ADDITIONAL UNSECURED BANK DEBT. Neither Borrower nor any
Subsidiaries of Borrower shall create, incur, assume or otherwise become liable
for any unsecured line of credit or other unsecured loan from any bank or
financial institution, other than the Facility, the Revolving Facility and the
BankBoston Term Loan, nor shall the Borrower cause any letter of credit to be
issued by any bank or financial institution for the account of Borrower or any
Subsidiaries of Borrower, other than the Letters of Credit issued under the
Revolving Credit Agreement.
8.10 RESTRICTIONS ON INDEBTEDNESS. Except with the prior written
consent of Requisite Lenders, the Borrower will not create, incur, assume,
guarantee or become or remain liable, contingently or otherwise, or agree not to
do any of same, with respect to any Indebtedness other than:
(a) Indebtedness to the Lenders arising under this
Agreement, Indebtedness to the lenders under the Revolving Credit Agreement,
Indebtedness to BankBoston arising under the BankBoston Term Loan and
Indebtedness to the holders of the Unsecured Term Notes arising thereunder;
(b) current liabilities of the Borrower incurred in the
ordinary course of business but not incurred through (i) the borrowing of money,
or (ii) the obtaining of credit except for credit on an open account basis
customarily extended and in fact extended in connection with normal purchases of
goods and services;
(c) Indebtedness in respect of taxes, assessments,
governmental charges or levies and claims for labor, materials and supplies to
the extent that payment therefor shall not at the time be required to be made in
accordance with the provisions of SECTION 7.4;
(d) Indebtedness in respect of judgments or awards that
have been in force for less than the applicable period for taking an appeal so
long as execution is not levied thereunder or in respect of which the Borrower
shall at the time in good faith be prosecuting an appeal or proceedings for
review and in respect of which a stay of execution shall have been obtained
pending such appeal or review;
(e) Endorsements for collection, deposit or negotiation
and warranties of products or services, in each case incurred in the ordinary
course of business;
(f) Indebtedness consisting of purchase money financing
for equipment used in the ordinary course of Borrower's business provided that
the amount of each such financing may not exceed 100% of the cost of the
purchased property.
(g) Nonrecourse Indebtedness of Borrower secured by a
Lien on a Portfolio Property (other than Woodbury Common for so long as SECTION
8.1 remains in effect) which is completely non-recourse to the Borrower and to
the REIT to the extent the same does not create a violation of SECTIONS 9.4,
9.5, 9.6 OR 9.7 provided that (i) upon the creation or assumption of any such
Indebtedness Borrower shall provide the Agent with a notice describing the terms
of such Indebtedness and the security therefor and a copy of the promissory note
or other instrument containing the nonrecourse provisions, and (ii) if the terms
of such Indebtedness include financial covenants, such covenants are determined
by the Agent in its sole discretion to be less stringent than the covenants set
forth in ARTICLE IX.
(h) Indebtedness of Borrower other than Nonrecourse
Indebtedness for borrowed money to the extent the same does not create a
violation of SECTIONS 9.4, 9.5, 9.6 OR 9.7 provided that (i) upon the creation
or assumption of any such Indebtedness Borrower shall provide the Agent with a
notice describing the terms of such Indebtedness, (ii) such Indebtedness must be
permitted under the terms of the Unsecured Term Notes, (iii) if the terms of
such Indebtedness include financial covenants such covenants are determined by
the Agent, in its sole discretion, to be not more stringent than the covenants
set forth in ARTICLE IX, and (iv) except for facilities having BankBoston as
sole lender or as agent for a group of lenders, such Indebtedness has a term
which matures at least twenty-four (24) months after the Termination Date.
(i) Indebtedness consisting of purchase money financing
for Land intended for development in connection with future Construction
Projects to the extent the same does not create a violation of SECTIONS 9.4,
9.5, 9.6 OR 9.7 provided that (i) the amount of such Indebtedness does not
exceed 100% of the cost of the purchased Land, (ii) the Indebtedness is secured
by a Lien on the purchased Land, (iii) the aggregate amount of the Indebtedness
described in this paragraph outstanding at any time shall not exceed
$15,000,000.00, and (iv) upon the creation of any such Indebtedness Borrower
shall provide the Agent with a notice describing the terms of such Indebtedness.
(j) Indebtedness of Borrower related to the Indebtedness of any Simon
Partnership to the extent the same does not create a violation of SECTION 9.4
provided that the respective recourse liability of Simon and Borrower with
respect thereto shall be in proportion to their respective percentage ownership
interests in the applicable Simon Partnership.
8.11 CONSTRUCTION PROJECTS. Borrower shall not commence construction
of any Construction Project if the addition of the budgeted project costs for
such project to the CIP Budget Amount would result in a violation of SECTION
9.11. At all times when the Portfolio Occupancy Rate is less than ninety-five
percent (95%) Borrower shall not commence construction of any Construction
Project prior to the earlier of (a) the date that premises which in the
aggregate constitute at least twenty percent (20%) of the gross leasable area of
such Construction Project are subject to executed leases under which (i)
occupancy by the tenant thereunder is conditioned only upon completion of
construction of the relevant improvements and (ii) such tenant is otherwise
unconditionally committed to take occupancy upon completion of such construction
or (b) the date that the Portfolio Occupancy Rate again exceeds ninety-five
percent (95%).
8.12 DISCONTINUITY IN MANAGEMENT. In the event that any three of the
five Executive Officers shall cease to be active on a full time, continuous
basis in the senior management of Borrower and the REIT ("DISCONTINUITY IN
MANAGEMENT"), Borrower shall have up to one hundred eighty (180) days to obtain
the approval of Requisite Lenders to additional executives, such that the
remaining and new management executives, as a group, have substantial and
sufficient knowledge, experience and capabilities in the management of a
publicly-held company engaged in the operation of a multi-asset real estate
business of the type engaged in by Borrower. In the event Borrower shall fail to
obtain approval of Requisite Lenders as aforesaid within said 180-day period,
then Borrower shall, at the election and upon the demand of Requisite Lenders,
pay in full all Obligations under the Loan Documents not later than sixty (60)
days after the end of such 180-day period, whereupon this Agreement shall be
terminated. Any Lender which abstains or otherwise fails to respond to any
request by Borrower for approval under this SECTION 8.12 within ten (10)
Business Days shall be counted among the Requisite Lenders approving the
proposed additional executives. In the event that Xxxxx Xxxxxxxx should retire
prior to the time that there has been any other changes in the Executive
Officers, the Borrower may designate another officer to replace Xx. Xxxxxxxx
among the Executive Officers and such replacement shall not be counted when
determining whether there has been a Discontinuity in Management.
ARTICLE IX
FINANCIAL COVENANTS
Borrower covenants and agrees that, on and after the date of this
Agreement and until payment in full of all the Obligations and the termination
of this Agreement:
9.1. VALUE OF ALL UNENCUMBERED PROPERTIES. The Borrower will not at
any time permit the Value of All Unencumbered Properties to be less than one
hundred seventy five percent (175%) of the outstanding balance of Unsecured
Indebtedness.
9.2. MINIMUM DEBT SERVICE COVERAGE. The Borrower will not at any time
permit the outstanding principal amount of the Unsecured Indebtedness to exceed
an amount such that: (a) the Unencumbered Net Operating Income, divided by (b)
Pro Forma Unsecured Debt Service Charges would be less than 1.5 for any Fiscal
Quarter.
9.3 MINIMUM FAIR MARKET NET WORTH. Borrower will maintain a Fair
Market Net Worth of not less than Three Hundred Million Dollars ($300,000,000)
plus seventy-five percent (75%) of Net Offering Proceeds received by Borrower or
the REIT after the Closing Date.
9.4 TOTAL LIABILITIES TO ADJUSTED ASSET VALUE RATIO. Borrower will not
at any time permit its Total Liabilities to exceed fifty-five percent (55%) of
Adjusted Asset Value.
9.5 MAXIMUM SECURED BORROWER DEBT. The Secured Borrower Debt shall not
exceed thirty percent (30%) of Adjusted Asset Value.
9.6 OPERATING CASH FLOW TO DEBT SERVICE RATIO. The ratio of Operating
Cash Flow to Debt Service shall not be less than 2.0:1 for any Fiscal Quarter.
9.7 EBITDA TO FIXED CHARGES RATIO. The ratio of EBITDA to Fixed
Charges shall not be less than 1.75:1 for any Fiscal Quarter.
9.8 AGGREGATE OCCUPANCY RATE. The Aggregate Occupancy Rate of the
Unencumbered Properties shall not be less than ninety percent (90%).
9.9 DISTRIBUTIONS.
9.9.1 Subject to SECTION 9.9.2, aggregate distributions to common
shareholders of the REIT and all partners of Borrower holding common units other
than the REIT shall not exceed the lesser of (i) ninety percent (90%) of Funds
From Operations for any Fiscal Year or (ii) one hundred percent (100%) of Funds
From Operations for more than two (2) consecutive Fiscal Quarters. For purposes
of this SECTION 9.9, the term "distributions" shall mean and include all
dividends and other distributions to, and the repurchase of stock or partnership
interests from, the holder of any equity interests in Borrower or the REIT.
9.9.2 Aggregate distributions during the continuance of any Event
of Default shall not exceed the lesser of (i) the aggregate amount permitted to
be made during the continuance thereof under SECTION 9.9.1, and (ii) the minimum
amount that the REIT must distribute to its shareholders in order to maintain
compliance with SECTION 7.11. If the Loans are not paid in full on the
Termination Date, no distributions shall be made thereafter except to the extent
expressly authorized in advance by Agent.
9.10 PERMITTED INVESTMENTS. Notwithstanding the limitations set forth
in SECTION 7.8, Borrower may make the following Permitted Investments, so long
as (i) the aggregate amount of all Permitted Investments does not exceed, at any
time, twenty-five percent (25%) of Adjusted Asset Value, and (ii) the aggregate
amount of each of the following categories of Permitted Investments does not
exceed the specified percentage of Adjusted Asset Value, in each case as of the
date made:
Maximum
Percentage of
Permitted Investment Adjusted Asset Value
Land and Non-Retail Properties: 15%
Foreign Investments: 10%
Investment Mortgages: 10%
Partnerships (other than Simon Partnerships): 15%.
For purposes of calculating compliance with the foregoing: (1) the amount of
each Investment will be deemed to be the original Acquisition Price thereof; (2)
in the case of each Investment in Land, Investment Mortgages and Partnerships,
the nature of underlying real property asset and the conduct of business in
respect thereof shall in all respects comply with the limitations set forth in
SECTION 7.8; and (3) Investments in Foreign Affiliates (other than in Foreign
Affiliates which are Wholly-Owned Subsidiaries) shall be counted as both an
investment in Partnerships and as a Foreign Investment but shall be counted only
once when determining the overall 25% limit. In addition, Borrower may also make
Investments in Simon Partnerships and such Investments shall not be subject to,
or counted against, the limitations on the amount of Permitted Investments
described in this SECTION 9.10.
9.11 CIP BUDGET AMOUNT TO ADJUSTED ASSET VALUE. The ratio of the CIP
Budget Amount to Adjusted Asset Value shall not exceed 0.25:1.
9.12 CALCULATION. Each of the foregoing ratios and financial
requirements shall be calculated as of the last day of each Fiscal Quarter,
provided, however that each of the foregoing ratios and financial requirements
which is affected by an increase in the outstanding balance of Unsecured
Indebtedness or by the sale or encumbrance of a Portfolio Property shall also be
recalculated as of the time of such event. For purposes of determining
compliance with SECTION 9.6, the period covered thereby shall be the immediately
preceding Fiscal Quarter.
ARTICLE X
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
10.1 EVENTS OF DEFAULT. Each of the following occurrences shall
constitute an Event of Default under this Agreement:
10.1.1 FAILURE TO MAKE PAYMENTS WHEN DUE. Borrower shall fail to
pay (i) any amount due on the Termination Date, (ii) any principal when due, or
(iii) any interest on any Loan, or any fee or other amount payable under any
Loan Documents, within five (5) days after the same becomes due.
10.1.2 REIT AND FINANCIAL COVENANTS. Borrower or the REIT shall
breach any covenant set forth in SECTION 7.11 or in ARTICLE IX (excluding
SECTION 9.8).
10.1.3 AGGREGATE OCCUPANCY RATE. Borrower shall fail to satisfy
the financial covenant regarding the Aggregate Occupancy Rate set forth in
SECTION 9.8 and such failure shall continue for sixty (60) days.
10.1.4 OTHER DEFAULTS. Borrower or the REIT shall fail duly and
punctually to perform or observe any agreement, covenant or obligation binding
on Borrower or the REIT under this Agreement or under any of the other Loan
Documents (other than as described in any other provision of this SECTION 10.1),
and with respect to agreements, covenants or obligations for which no time
period for performance is otherwise provided, such failure shall continue for
fifteen (15) days after Borrower or the REIT knew of such failure (or such
lesser period of time as is mandated by applicable Requirements of Law);
PROVIDED, however, if such failure is capable of cure but is not capable of cure
within such fifteen (15) day period, then if Borrower promptly undertakes action
to cure such failure and thereafter diligently prosecutes such cure to
completion within forty-five (45) days after Borrower or the REIT knew of such
failure, then Borrower shall not be in default hereunder.
10.1.5 BREACH OF REPRESENTATION OR WARRANTY. Any representation
or warranty made or deemed made by Borrower or the REIT to Agent or any Lender
herein or in any of the other Loan Documents or in any statement, certificate or
financial statements at any time given by Borrower pursuant to any of the Loan
Documents shall be false or misleading in any material respect on the date as of
which made.
10.1.6 DEFAULT AS TO OTHER INDEBTEDNESS. (i) Borrower, the REIT
or any GP Partnership shall have (A) failed to pay when due (beyond any
applicable grace period), any amount in respect of any Indebtedness (other than
Nonrecourse Indebtedness) of such party other than the Obligations if the
aggregate amount of such other Indebtedness is Ten Million Dollars ($10,000,000)
or more; or (B) otherwise defaulted (beyond any applicable grace period) under
any Indebtedness of such party other than the Obligations if (1) the aggregate
amount of such other Indebtedness is Ten Million Dollars ($10,000,000) or more,
and (2) the holder of such Indebtedness has accelerated such Indebtedness; or
(ii) any such other Indebtedness shall have otherwise become payable, or be
required to be purchased or redeemed, prior to its scheduled maturity; or (iii)
the holder(s) of any Lien, in any amount, commence foreclosure of such Lien upon
any Property having an aggregate value in excess of Ten Million Dollars
($10,000,000); or (iv) any "Event of Default" shall exist under the Unsecured
Term Note Indenture, or (v) any "Event of Default" shall exist under the Term
Loan Agreement relating to the BankBoston Term Loan; or (vi) any "Event of
Default" shall exist under the Revolving Credit Agreement.
10.1.7 INVOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(a) An involuntary case shall be commenced against the
REIT, Borrower or any GP Partnership, and the petition shall not
be dismissed within sixty (60) days after commencement of the
case, or a court having jurisdiction shall enter a decree or
order for relief in respect of any such Person in an involuntary
case, under any applicable bankruptcy, insolvency or other
similar law now or hereinafter in effect; or any other similar
relief shall be granted under any applicable federal, state or
foreign law; or
(b) A decree or order of a court having jurisdiction in
the premises for the appointment of a receiver, liquidator,
sequestrator, trustee, custodian or other officer having similar
powers over the REIT, Borrower or any GP Partnership, or over all
or a substantial part of the property of any such Person, shall
be entered; or an interim receiver, trustee or other custodian of
any such Person or of all or a substantial part of the property
of any such Person, shall be appointed or a warrant of
attachment, execution or similar process against any substantial
part of the property of any such Person, shall be issued and any
such event shall not be stayed, vacated, dismissed, bonded or
discharged within sixty (60) days of entry, appointment or
issuance.
10.1.8 VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC. The
REIT, Borrower, or any GP Partnership shall have an order for relief entered
with respect to it or commence a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or shall consent to
the entry of an order for relief in an involuntary case, or to the conversion of
an involuntary case to a voluntary case, under any such law, or shall consent to
the appointment of or taking of possession by a receiver, trustee or other
custodian for all or a substantial part of its property; any such Person shall
make any assignment for the benefit of creditors or shall be unable or fail, or
admit in writing its inability, to pay its debts as such debts become due; or
the general partner (or Person(s) serving in a similar capacity) of Borrower or
the REIT's Board of Directors (or any committee thereof) adopts any resolution
or otherwise authorizes any action to approve any of the foregoing.
10.1.9 JUDGMENTS AND ATTACHMENTS. (i) Any money judgment (other
than a money judgment covered by insurance but only if the insurer has admitted
liability with respect to such money judgment), writ or warrant of attachment,
or similar process involving in any case an amount in excess of One Million
Dollars ($1,000,000) shall be entered or filed against the REIT, Borrower, or
any GP Partnership or their respective assets and shall remain undischarged,
unvacated, unbonded or unstayed for a period of thirty (30) days, or (ii) any
judgment or order of any court or administrative agency awarding material
damages shall be entered against any such Person in any action under the Federal
securities laws seeking rescission of the purchase or sale of, or for damages
arising from the purchase or sale of, any Securities, such judgment or order
shall have become final after exhaustion of all available appellate remedies
and, in Agent's judgment, the payment of such judgment or order would have a
Material Adverse Effect on such Person.
10.1.10 DISSOLUTION. Any order, judgment or decree shall be
entered against the REIT, Borrower, or any GP Partnership decreeing its
involuntary dissolution or split up and such order shall remain undischarged and
unstayed for a period in excess of thirty (30) days; or the REIT or Borrower
shall otherwise dissolve or cease to exist.
10.1.11 LOAN DOCUMENTS; FAILURE OF SUBORDINATION. If for any
reason (i) any Loan Document shall cease to be in full force and effect, or (ii)
any Obligation shall be subordinated in right of payment to any other unsecured
liability of the Borrower.
10.1.12 ERISA LIABILITIES. Any Termination Event occurs which
will or is reasonably likely to subject Borrower, the REIT or any ERISA
Affiliate to a liability which Agent reasonably determines will have a Material
Adverse Effect on Borrower or the REIT, or the plan administrator of any Benefit
Plan applies for approval under Section 412(d) of the Internal Revenue Code for
a waiver of the minimum funding standards of Section 412(a) of the Internal
Revenue Code and Agent reasonably determines that the business hardship upon
which the Section 412(d) waiver was based will or would reasonably be
anticipated to subject Borrower or the REIT to a liability which Agent
determines will have a Material Adverse Effect on Borrower or the REIT.
10.1.13 ENVIRONMENTAL LIABILITIES. Borrower, the REIT or any
Subsidiary or Partnership becomes subject to any Liabilities and Costs which
Agent reasonably deems to have a Material Adverse Effect on such Person arising
out of or related to the Release at any Property of any Contaminant into the
environment, or any Remedial Action in response thereto, or any other violation
of any Environmental Laws.
10.1.14 SOLVENCY; MATERIAL ADVERSE CHANGE. Borrower or the REIT
shall cease to be Solvent, or there shall have occurred any material adverse
change in the business, operations, properties, assets or condition (financial
or otherwise) of Borrower or the REIT.
An Event of Default shall be deemed "continuing" until cured or
waived in writing in accordance with SECTION 12.4.
10.2 RIGHTS AND REMEDIES.
10.2.1 ACCELERATION, ETC. Upon the occurrence of any Event of
Default described in the foregoing SECTION 10.1.7 or 10.1.8 with respect to the
REIT or Borrower, the unpaid principal amount of and any and all accrued
interest on the Loans shall automatically become immediately due and payable,
with all additional interest from time to time accrued thereon and without
presentment, demand or protest or other requirements of any kind (including,
without limitation, valuation and appraisement, diligence, presentment, notice
of intent to demand or accelerate or notice of acceleration), all of which are
hereby expressly waived by Borrower; and upon the occurrence and during the
continuance of any other Event of Default, Agent shall, at the request, or may,
with the consent of Requisite Lenders, by written notice to Borrower, declare
the unpaid principal amount of, any and all accrued and unpaid interest on the
Loans and all of the other Obligations to be, and the same shall thereupon be,
immediately due and payable with all additional interest from time to time
accrued thereon and without presentment, demand, or protest or other
requirements of any kind (including without limitation, valuation and
appraisement, diligence, presentment, notice of intent to demand or accelerate
and of acceleration), all of which are hereby expressly waived by Borrower.
Without limiting Agent's authority hereunder, on or after the Termination Date,
Agent shall, at the request, or may, with the consent, of Requisite Lenders
exercise any or all rights and remedies under the Loan Documents or applicable
law. Upon the occurrence of and during the continuance of an Event of Default,
Agent shall be entitled to request and receive, by or through Borrower or
appropriate legal process, any and all information concerning the REIT, Borrower
or any property of any of them, which is reasonably available to or obtainable
by Borrower.
10.2.2 WAIVER OF DEMAND. Demand, presentment, protest and notice
of nonpayment are hereby waived by Borrower. Borrower also waives, to the extent
permitted by law, the benefit of all exemption laws.
10.2.3 WAIVERS, AMENDMENTS AND REMEDIES. No delay or omission of
Agent or Lenders to exercise any right under any Loan Document shall impair such
right or be construed to be a waiver of any Event of Default or an acquiescence
therein, and any single or partial exercise of any such right shall not preclude
other or further exercise thereof or the exercise of any other right, and no
waiver, amendment or other variation of the terms, conditions or provisions of
the Loan Documents whatsoever shall be valid unless in writing signed by Agent
after obtaining written approval thereof or the signature thereon of those
Lenders required to approve such waiver, amendment or other variation, and then
only to the extent in such writing specifically set forth. All remedies
contained in the Loan Documents or by law afforded shall be cumulative and all
shall be available to Agent and Lenders until the Obligations have been paid in
full and this Agreement has been terminated.
10.3 RESCISSION. If at any time after acceleration of the maturity of
the Loans, Borrower shall pay all arrears of interest and all payments on
account of principal of the Loans which shall have become due otherwise than by
acceleration (with interest on principal and, to the extent permitted by law, on
overdue interest, at the rates specified in this Agreement) and all Events of
Default and Unmatured Events of Default (other than nonpayment of principal of
and accrued interest on the Loans due and payable solely by virtue of
acceleration) shall be remedied or waived pursuant to SECTION 12.4, then by
written notice to Borrower, Requisite Lenders may elect, in their sole
discretion, to rescind and annul the acceleration and its consequences; but such
action shall not affect any subsequent Event of Default or Unmatured Event of
Default or impair any right or remedy consequent thereon. The provisions of the
preceding sentence are intended merely to bind Lenders to a decision which may
be made at the election of Requisite Lenders; they are not intended to benefit
Borrower and do not give Borrower the right to require Lenders to rescind or
annul any acceleration hereunder, even if the conditions set forth herein are
met.
ARTICLE XI
AGENCY PROVISIONS
11.1 APPOINTMENT.
11.1.1 Each Lender hereby (i) designates and appoints BankBoston
as Agent of such Lender under this Agreement and the Loan Documents, (ii)
authorizes and directs Agent to enter into the Loan Documents other than this
Agreement for the benefit of Lenders, and (iii) authorizes Agent to take such
action on its behalf under the provisions of this Agreement and the Loan
Documents and to exercise such powers as are set forth herein or therein,
together with such other powers as are reasonably incidental thereto, subject to
the limitations referred to in SECTIONS 11.10.1 and 11.10.2. Agent agrees to act
as such on the express conditions contained in this ARTICLE XI.
11.1.2 The provisions of this ARTICLE XI are solely for the
benefit of Agent and Lenders, and Borrower shall not have any rights to rely on
or enforce any of the provisions hereof (other than as expressly set forth in
SECTIONS 11.3 and 11.9, PROVIDED, HOWEVER, that the foregoing shall in no way
limit Borrower's obligations under this ARTICLE XI. In performing its functions
and duties under this Agreement, Agent shall act solely as Agent of Lenders and
does not assume and shall not be deemed to have assumed any obligation toward or
relationship of agency or trust with or for Borrower or any other Person.
11.2 NATURE OF DUTIES. Agent shall not have any duties or
responsibilities except those expressly set forth in this Agreement or in the
Loan Documents. Subject to the provisions of SECTIONS 11.5 and 11.7, Agent shall
administer the Loans in the same manner as it administers its own loans.
Promptly following the effectiveness of this Agreement, Agent shall send to each
Lender its originally executed Note and the executed original, to the extent the
same are available in sufficient numbers, of each other Loan Document other than
the Notes in favor of other Lenders. Agent shall not have by reason of this
Agreement a fiduciary relationship in respect of any Lender. Nothing in this
Agreement or any of the Loan Documents, expressed or implied, is intended or
shall be construed to impose upon Agent any obligation in respect of this
Agreement or any of the Loan Documents except as expressly set forth herein or
therein. Each Lender shall make its own independent investigation of the
financial condition and affairs of the REIT, Borrower and each Portfolio
Property in connection with the making and the continuance of the Loans
hereunder and shall make its own appraisal of the creditworthiness of the REIT
and Borrower, and, except as specifically provided herein, Agent shall not have
any duty or responsibility, either initially or on a continuing basis, to
provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before the Closing Date or at any time or
times thereafter.
11.3 LOAN DISBURSEMENT.
11.3.1 Not later than 1:00 P.M. (Eastern time) on the Closing
Date each Lender shall make available to Agent, the full amount of such Lender's
Commitment in immediately available funds. Unless Agent shall have been notified
by any Lender prior to such time for funding that such Lender does not intend to
make available to Agent such Lender's Loan, Agent may assume that such Lender
has made such amount available to Agent. In any case where a Lender does not for
any reason make available to Agent such Lender's Loan, Agent, in its sole
discretion, may, but shall not be obligated to, fund to Borrower such Lender's
Loan. If the amount so funded by Agent is not in fact made available to Agent by
the responsible Lender, then Borrower agrees to repay to Agent such amount,
together with interest thereon at the Base Rate for each day from the date such
amount is made available to Borrower until the date such amount is repaid to
Agent, not later than three (3) Business Days following Agent's demand to
Borrower that such repayment be made. In addition, such Lender agrees to pay to
Agent forthwith on demand such corresponding amount, together with interest
thereon at the Federal Funds Rate. If such Lender shall pay to Agent such
corresponding amount, such amount so paid shall constitute such Lender's Loan,
and if both such Lender and Borrower shall have paid and repaid, respectively,
such corresponding amount, Agent shall promptly return to Borrower such
corresponding amount in same day funds; interest paid by Borrower in respect of
such corresponding amount shall be prorated, as of the date of payment thereof
by such Lender to Agent. In the event that Agent shall not have funded such
Lender's Pro Rata Share under this SECTION 11.3.1, then Borrower shall not be
obligated to accept a late funding of such Lender's Pro Rata Share if such
funding is made more than two (2) Business Days following the applicable Funding
Date. If Borrower declines to accept such delinquent funding, Agent shall
promptly return to such Lender the amount of such funding. Nothing in this
SECTION 11.3.1 shall alter the respective rights and obligations of the parties
hereunder in respect of a Defaulting Lender.
11.3.2 Nothing in this SECTION 11.3 shall be deemed to relieve
any Lender of its obligation hereunder to make its Loan on the Closing Date, nor
shall any Lender be responsible for the failure of any other Lender to perform
its obligations to make any Loan hereunder, and the Commitment of any Lender
shall not be increased or decreased as a result of the failure by any other
Lender to perform its obligation to make its Loan.
11.4 DISTRIBUTION AND APPORTIONMENT OF PAYMENTS. Payments actually
received by Agent for the account of Lenders shall be paid to them promptly
after receipt thereof by Agent, but in any event within two (2) Business Days,
PROVIDED that Agent shall pay to Lenders interest thereon, at the lesser of (i)
Federal Funds Rate and (ii) the rate of interest applicable to such Loans, from
the Business Day following receipt of such funds by Agent until such funds are
paid in immediately available funds to Lenders. Subject to SECTION 11.4.2, all
payments of principal and interest in respect of outstanding Loans, all payments
of the fees described in this Agreement, and all payments in respect of any
other Obligations shall be allocated among such of Lenders as are entitled
thereto, in proportion to their respective Pro Rata Shares or otherwise as
provided herein. Agent shall promptly distribute, but in any event within two
(2) Business Days, to each Lender at its primary address set forth on the
appropriate signature page hereof or on the Assignment and Assumption, or at
such other address as a Lender may request in writing, such funds as it may be
entitled to receive, PROVIDED that Agent shall in any event not be bound to
inquire into or determine the validity, scope or priority of any interest or
entitlement of any Lender and may suspend all payments and seek appropriate
relief (including, without limitation, instructions from Requisite Lenders or
all Lenders, as applicable, or an action in the nature of interpleader) in the
event of any doubt or dispute as to any apportionment or distribution
contemplated hereby. The order of priority herein is set forth solely to
determine the rights and priorities of Lenders as among themselves and may at
any time or from time to time be changed by Lenders as they may elect, in
writing in accordance with SECTION 12.4, without necessity of notice to or
consent of or approval by Borrower or any other Person. All payments or other
sums received by Agent for the account of Lenders shall not constitute property
or assets of Agent and shall be held by Agent, solely in its capacity as agent
for itself and the other Lenders, subject to the Loan Documents.
11.5 RIGHTS, EXCULPATION, ETC. Neither Agent, any Affiliate of Agent,
nor any of their respective officers, directors, employees, agents, attorneys or
consultants, shall be liable to any Lender for any action taken or omitted by
them hereunder or under any of the Loan Documents, or in connection herewith or
therewith, except that Agent shall be liable for its gross negligence or willful
misconduct. In the absence of gross negligence or willful misconduct, Agent
shall not be liable for any apportionment or distribution of payments made by it
in good faith pursuant to SECTION 11.4, and if any such apportionment or
distribution is subsequently determined to have been made in error the sole
recourse of any Person to whom payment was due, but not made, shall be to
recover from the recipients of such payments any payment in excess of the amount
to which they are determined to have been entitled. Agent shall not be
responsible to any Lender for any recitals, statements, representations or
warranties herein or for the execution, effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any of the
other Loan Documents, or any of the transactions contemplated hereby and
thereby; or for the financial condition of the REIT, Borrower or any of their
Affiliates. Agent shall not be required to make any inquiry concerning either
the performance or observance of any of the terms, provisions or conditions of
this Agreement or any of the Loan Documents or the financial condition of the
REIT, Borrower or any of their Affiliates, or the existence or possible
existence of any Unmatured Event of Default or Event of Default.
11.6 RELIANCE. Agent shall be entitled to rely upon any written
notices, statements, certificates, orders or other documents, telecopies or any
telephone message believed by it in good faith to be genuine and correct and to
have been signed, sent or made by the proper Person, and with respect to all
matters pertaining to this Agreement or any of the Loan Documents and its duties
hereunder or thereunder, upon advice of legal counsel (including counsel for
Borrower), independent public accountant and other experts selected by it.
11.7 INDEMNIFICATION. To the extent that Agent is not reimbursed and
indemnified by Borrower, Lenders will reimburse, within ten (10) Business Days
after notice from Agent, and indemnify and defend Agent for and against any and
all Liabilities and Costs (other than losses in the collection of principal and
interest on the Loans which losses shall be shared among all Lenders including
the Agent as provided in SECTIONS 11.4 and 11.13) which may be imposed on,
incurred by, or asserted against it in any way relating to or arising out of
this Agreement or any of the other Loan Documents or any action taken or omitted
by Agent or under this Agreement or any of the other Loan Documents, in
proportion to each Lender's Pro Rata Share; PROVIDED that no Lender shall be
liable for any portion of such Liabilities and Costs resulting from Agent's
gross negligence or willful misconduct or in respect of normal administrative
costs and expenses incurred by Agent (prior to any Event of Default or any
Unmatured Event of Default) in connection with its performance of administrative
duties under this Agreement and the other Loan Documents. The obligations of
Lenders under this SECTION 11.7 shall survive the payment in full of all
Obligations and the termination of this Agreement. In the event that after
payment and distribution of any amount by Agent to Lenders, any Lender or third
party, including Borrower, any creditor of Borrower or a trustee in bankruptcy,
recovers from Agent any amount found to have been wrongfully paid to Agent or
disbursed by Agent to Lenders, then Lenders, in proportion to their respective
Pro Rata Shares, shall reimburse Agent for all such amounts. Notwithstanding the
foregoing, Agent shall not be obligated to advance Liabilities and Costs and may
require the deposit by each Lender of its Pro Rata Share of any material
Liabilities and Costs anticipated by Agent before they are incurred or made
payable.
11.8 AGENT INDIVIDUALLY. With respect to its Pro Rata Share of the
Obligations hereunder and the Loans made by it, Agent shall have and may
exercise the same rights and powers hereunder and is subject to the same
obligations and liabilities as and to the extent set forth herein for any other
Lender. The terms "Lenders", "Requisite Lenders" or any similar terms may
include Agent in its individual capacity as a Lender or one of the Requisite
Lenders. Agent and any Lender and its Affiliates may accept deposits from, lend
money to, and generally engage in any kind of banking, trust or other business
with Borrower or any of its Affiliates as if it were not acting as Agent or
Lender pursuant hereto.
11.9 SUCCESSOR AGENT; RESIGNATION OF AGENT; REMOVAL OF AGENT.
11.9.1 Agent may resign from the performance of all its functions
and duties hereunder at any time by giving at least thirty (30) Business Days,
prior written notice to Lenders and Borrower, and shall automatically cease to
be Agent hereunder in the event a petition in bankruptcy shall be filed by or
against Agent or the Federal Deposit Insurance Corporation or any other
Governmental Authority shall assume control of Agent or Agent's interests under
the Facility. Further, Lenders whose aggregate outstanding Loans constitute at
least sixty-six and two-thirds percent (66-2/3%) of the outstanding Loans of all
Lenders excluding the Agent may remove Agent for cause at any time by giving at
least thirty (30) Business Days' prior written notice to Agent, Borrower and all
other Lenders. If Agent enters into one or more assignments pursuant to SECTION
11.12 having the effect of reducing its outstanding Loans to less than
$8,000,000 then any Lender whose outstanding Loans exceed those of Agent may
remove Agent by notice given within thirty (30) days after such Lender receives
notice of the assignments which reduce the Agent's outstanding Loans below such
level. Such resignation or removal shall take effect upon the acceptance by a
successor Agent appointed pursuant to SECTION 11.9.2 or 11.9.3.
11.9.2 Upon any such notice of resignation by or removal of
Agent, Requisite Lenders shall appoint a successor Agent with the consent of
Borrower, which consent shall not be unreasonably withheld or delayed AND which
consent shall not be required if there shall then exist any Event of Default.
Any successor Agent must be a bank (i) the senior debt obligations of which (or
such bank's parent's senior unsecured debt obligations) are rated not less than
BBB by one of the Rating Agencies and (ii) which has total assets in excess of
Ten Billion Dollars ($10,000,000,000). Such successor Agent shall separately
confirm in writing with Borrower the fee to be paid to such Agent pursuant to
SECTION 2.5.2.
11.9.3 If a successor Agent shall not have been so appointed
within said thirty (30) Business Day period, the retiring or removed Agent,
shall then appoint a successor Agent who shall meet the requirements described
in SECTION 11.9.2 and who shall serve as Agent until such time, if any, as
Requisite Lenders, appoint a successor Agent as provided above.
11.10 CONSENT AND APPROVALS.
11.10.1 Each of the following shall require the approval or
consent of Requisite Lenders:
(a) Approval of notes receivable pursuant to definition
of Adjusted Asset Value (SECTION 1.1);
(b) Consent to Indebtedness (SECTION 8.10);
(c) Approval of additional executives upon a
Discontinuity in Management (SECTION 8.12);
(d) Acceleration following an Event of Default (SECTION
10.2.1) or rescission of such acceleration (SECTION 10.3);
(e) Approval of the exercise of rights and remedies
under the Loan Documents following an Event of Default (SECTION
10.2.1);
(f) Appointment of a successor Agent (SECTION 11.9);
(g) Except as referred to in SECTION 11.10.2 or
11.11.1, approval of any amendment, modification or termination of
this Agreement, or waiver of any provision herein (SECTION 12.4).
11.10.2 Each amendment, modification or waiver specifically
enumerated in SECTION 12.4.1 shall require the consent of all Lenders.
11.10.3 In addition to the required consents or approvals
referred to in SECTION 11.10.1, Agent may at any time request instructions from
Requisite Lenders with respect to any actions or approvals which, by the terms
of this Agreement or of any of the Loan Documents, Agent is permitted or
required to take or to grant without instructions from any Lenders, and if such
instructions are promptly requested, Agent shall be absolutely entitled to
refrain from taking any action or to withhold any approval and shall not be
under any liability whatsoever to any Person for refraining from taking any
action or withholding any approval under any of the Loan Documents until it
shall have received such instructions from Requisite Lenders. Without limiting
the foregoing, no Lender shall have any right of action whatsoever against Agent
as a result of Agent acting or refraining from acting under this Agreement or
any of the other Loan Documents in accordance with the instructions of Requisite
Lenders or, where applicable, all Lenders. Agent shall promptly notify each
Lender at any time that the Requisite Lenders have instructed Agent to act or
refrain from acting pursuant to this SECTION 11.10.3.
11.10.4 Each Lender agrees that any action taken by Agent at the
direction or with the consent of Requisite Lenders in accordance with the
provisions of this Agreement or any Loan Document, and the exercise by Agent at
the direction or with the consent of Requisite Lenders of the powers set forth
herein or therein, together with such other powers as are reasonably incidental
thereto, shall be authorized and binding upon all Lenders, except for actions
specifically requiring the approval of all Lenders. All communications from
Agent to Lenders requesting Lenders' determination, consent, approval or
disapproval (i) shall be given in the form of a written notice to each Lender,
(ii) shall be accompanied by a description of the matter or thing as to which
such determination, approval, consent or disapproval is requested, or shall
advise each Lender where such matter or thing may be inspected, or shall
otherwise describe the matter or issue to be resolved, (iii) shall include, if
reasonably requested by a Lender and to the extent not previously provided to
such Lender, written materials and a summary of all oral information provided to
Agent by Borrower in respect of the matter or issue to be resolved, and (iv) may
include Agent's recommended course of action or determination in respect
thereof. Each Lender shall reply promptly, but in any event within ten (10)
Business Days (the "LENDER REPLY Period"). Unless a Lender shall give written
notice to Agent that it objects to the recommendation or determination of Agent
(together with a written explanation of the reasons behind such objection)
within the Lender Reply Period, such Lender shall be deemed to have approved of
or consented to such recommendation or determination. With respect to decisions
requiring the approval of Requisite Lenders or all Lenders, Agent shall submit
its recommendation or determination for approval of or consent to such
recommendation or determination to all Lenders and upon receiving the required
approval or consent shall follow the course of action or determination
recommended to Lenders by Agent or such other course of action recommended by
Requisite Lenders, and each non-responding Lender shall be deemed to have
concurred with such recommended course of action.
11.11 AGENCY PROVISIONS RELATING TO CERTAIN ENFORCEMENT ACTIONS.
11.11.1 Agent is hereby authorized on behalf of all Lenders,
without the necessity of any notice to or further consent from any Lender, to
waive the imposition of late fees provided for in SECTION 2.4.5 up to a maximum
of three (3) times during the term of this Agreement.
11.11.2 Should Agent (i) employ counsel for advice or other
representation (whether or not any suit has been or shall be filed) with respect
to any of the Loan Documents, or (ii) commence any proceeding or in any way seek
to enforce its rights or remedies under the Loan Documents, each Lender, upon
demand therefor from time to time, shall contribute its share (based on its Pro
Rata Share) of the reasonable costs and/or expenses of any such advice or other
representation, enforcement or acquisition, including, but not limited to, fees
of receivers, court costs and fees and expenses of attorneys to the extent not
otherwise reimbursed by Borrower; PROVIDED that Agent shall not be entitled to
reimbursement of its attorneys' fees and expenses incurred in connection with
the resolution of disputes between Agent and other Lenders unless Agent shall be
the prevailing party in any such dispute. Any loss of principal and interest
resulting from any Event of Default shall be shared by Lenders in accordance
with their respective Pro Rata Shares.
11.12 ASSIGNMENTS AND PARTICIPATIONS.
11.12.1 Each Lender may assign, to one or more Eligible
Assignees, all or a portion of its rights and obligations under this Agreement
(including without limitation all or a portion of the Loans owing to it) and
other Loan Documents; PROVIDED, HOWEVER, that (i) each such assignment shall be
of a constant, and not a varying, percentage of the assigning Lender's rights
and obligations under this Agreement and other Loan Documents, and the
assignment shall cover the same percentage of such Lender's Loans, (ii) unless
Agent and Borrower otherwise consent (except that after an Event of Default only
the consent of Agent shall be required), the aggregate amount of the Loans of
the assigning Lender being assigned pursuant to each such assignment (determined
as of the date of the Assignment and Assumption with respect to such assignment)
shall in no event be less than Five Million Dollars ($5,000,000) and shall be an
integral multiple of One Million Dollars ($1,000,000), (iii) after giving effect
to such assignment, the aggregate amount of the Loans retained by the assigning
Lender shall in no event be less than Five Million Dollars ($5,000,000), (iv)
the parties to each such assignment shall execute and deliver to Agent, for its
approval and acceptance, an Assignment and Assumption, and (v) Agent shall
receive from the assignor a processing fee of Three Thousand Dollars ($3,000).
Upon such execution, delivery, approval and acceptance, and upon the effective
date specified in the applicable Assignment and Assumption, (X) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Assumption, have the rights and obligations of a Lender hereunder, and (Y) the
assigning Lender thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Assumption,
relinquish its rights and be released from its obligations under this Agreement.
11.12.2 By executing and delivering an Assignment and Assumption,
the assigning Lender thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Assumption, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
Loan Document or any other instrument or document furnished pursuant hereto;
(ii) such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the REIT or Borrower
or the performance or observance by the REIT or Borrower of any of their
respective obligations under any Loan Document or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in ARTICLE V or delivered pursuant to ARTICLE VI to the
date of such assignment and such other Loan Documents and other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Assumption; (iv) such assignee will,
independently and without reliance upon Agent, such assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (v) such assignee appoints and
authorizes Agent to take such action as Agent on its behalf and to exercise such
powers under this Agreement and the other Loan Documents as are delegated to
Agent by the terms hereof and thereof, together with such powers as are
reasonably incidental thereto; and (vi) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of this Agreement are required to be performed by it as a Lender.
11.12.3 Agent shall maintain, at its address referred to on the
counterpart signature pages hereof, a copy of each Assignment and Assumption
delivered to and accepted by it and shall record in the Loan Account the names
and addresses of each Lender and the principal amount of the Loans owing to,
such Lender from time to time. Borrower, Agent and Lenders may treat each Person
whose name is recorded in the Loan Account as a Lender hereunder for all
purposes of this Agreement.
11.12.4 Upon its receipt of an Assignment and Assumption executed
by an assigning Lender and an assignee, Agent shall, if such Assignment and
Assumption has been properly completed and is in substantially the form of
EXHIBIT A, (i) accept such Assignment and Assumption, (ii) record the
information contained therein in the Loan Account, and (iii) give prompt notice
thereof to Borrower. Upon request, Borrower will execute and deliver to Agent an
appropriate replacement promissory note or replacement promissory notes in favor
of each assignee (and assignor, if such assignor is retaining a portion of its
Loans) reflecting such assignee's (and assigner's) Pro Rata Share(s) of the
Facility. Upon execution and delivery of such replacement promissory notes the
original promissory note or notes evidencing all or a portion of the Loans being
assigned shall be cancelled and returned to Borrower.
11.12.5 Each Lender may sell participations to one or more banks
or other entities in or to all or a portion of its rights and obligations under
this Agreement (including without limitation all or a portion of the Loans owing
to it) and other Loan Documents; PROVIDED, HOWEVER, that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, (iii) Borrower, Agent and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement and with regard to any and all
payments to be made under this Agreement, and (iv) the holder of any such
participation shall not be entitled to voting rights under this Agreement except
for voting rights with respect to (A) increases in the Facility; (B) extensions
of the Termination Date; and (C) decreases in the interest rates described in
this Agreement. No participant shall be entitled to vote on any matter until the
Lender with which such participant is participating in the Facility and the
Loans confirms such participant's status as a participant hereunder.
11.12.6 Borrower will use reasonable efforts to cooperate with
Agent and Lenders in connection with the assignment of interests under this
Agreement or the sale of participations herein.
11.12.7 Anything in this Agreement to the contrary
notwithstanding, and without the need to comply with any of the formal or
procedural requirements of this Agreement, including this SECTION 11.12, any
Lender may at any time and from time to time pledge and assign all or any
portion of its rights under all or any of the Loan Documents to a Federal
Reserve Bank; PROVIDED that no such pledge or assignment shall release such
Lender from its obligations thereunder. To facilitate any such pledge or
assignment, Agent shall, at the request of such Lender, enter into a letter
agreement with the Federal Reserve Bank in substantially the form of the exhibit
to Appendix C to the Federal Reserve Bank of New York Operating circular No. 12.
11.12.8 Anything in this Agreement to the contrary
notwithstanding, any Lender may assign all or any portion of its rights and
obligations under this Agreement to another branch or Affiliate of such Lender,
PROVIDED that (i) at the time of such assignment such Lender is not a Defaulting
Lender, (ii) such Lender gives Agent and Borrower at least fifteen (15) days'
prior written notice of any such assignment, (iii) the parties to each such
assignment execute and deliver to Agent an Assignment and Assumption, and (iv)
Agent receives from assignor a processing fee of Three Thousand Dollars
($3,000).
11.12.9 No assignee of any rights and obligations under this
Agreement shall be permitted to subassign such rights and obligations.
11.12.10 No Lender shall be permitted to assign or sell all or
any portion of its rights and obligations under this Agreement to Borrower or
any Affiliate of Borrower.
11.13 RATABLE SHARING. Subject to SECTIONS 11.3 and 11.4, Lenders
agree among themselves that (i) with respect to all amounts received by them
which are applicable to the payment of the Obligations, equitable adjustment
will be made so that, in effect, all such amounts will be shared among them
ratably in accordance with their Pro Rata Shares, whether received by voluntary
payment, by counterclaim or cross action or by the enforcement of any or all of
the Obligations, (ii) if any of them shall by voluntary payment or by the
exercise of any right of counterclaim or otherwise, receive payment of a
proportion of the aggregate amount of the Obligations held by it which is
greater than its Pro Rata Share of the payments on account of the Obligations,
the one receiving such excess payment shall purchase, without recourse or
warranty, an undivided interest and participation (which it shall be deemed to
have done simultaneously upon the receipt of such payment) in such Obligations
owed to the others so that all such recoveries with respect to such Obligations
shall be applied ratably in accordance with their Pro Rata Shares; PROVIDED,
that if all or part of such excess payment received by the purchasing party is
thereafter recovered from it, those purchases shall be rescinded and the
purchase prices paid for such participations shall be returned to that party to
the extent necessary to adjust for such recovery, but without interest except to
the extent the purchasing party is required to pay interest in connection with
such recovery. Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this SECTION 11.13 may, to the fullest extent
permitted by law, exercise all its rights of payment with respect to such
participation as fully as if such Lender were the direct creditor of Borrower in
the amount of such participation.
11.14 DELIVERY OF DOCUMENTS. Agent shall as soon as reasonably
practicable distribute to each Lender at its primary address set forth on the
appropriate counterpart signature page hereof, or at such other address as a
Lender may request in writing, (i) all documents to which such Lender is a party
or of which such Lender is a beneficiary set forth in SECTION 4.1, (ii) all
documents of which Agent receives copies from Borrower pursuant to SECTION 6.1
(except as provided in SECTION 6.1.1) and SECTION 12.6, (iii) all other
documents or information which Agent is required to send to Lenders pursuant to
the terms of this Agreement; (iv) other information or documents received by
Agent at the request of any Lender, and (v) all notices received by Agent
pursuant to SECTION 6.2. In addition, within fifteen (15) Business Days after
receipt of a request in writing from a Lender for written information or
documents provided by or prepared by Borrower or the REIT, Agent shall deliver
such written information or documents to such requesting Lender if Agent has
possession of such written information or documents in its capacity as Agent or
as a Lender.
11.15 NOTICE OF EVENTS OF DEFAULT. Agent shall not be deemed to have
knowledge or notice of the occurrence of any Unmatured Event of Default or Event
of Default (other than nonpayment of principal of or interest on the Loans)
unless Agent has received notice in writing from a Lender or Borrower referring
to this Agreement or the other Loan Documents, describing such event or
condition and expressly stating that such notice is a notice of an Unmatured
Event of Default or Event of Default. Should Agent receive such notice of the
occurrence of an Unmatured Event of Default or Event of Default, or should Agent
send Borrower a notice of Unmatured Event of Default or Event of Default, Agent
shall promptly give notice thereof to each Lender.
ARTICLE XII
MISCELLANEOUS
12.1 EXPENSES.
12.1.1 GENERALLY. Borrower agrees upon demand to pay, or
reimburse Agent for, all of Agent's external audit, legal and investigation
expenses and for all other reasonable out-of-pocket costs and expenses of every
type and nature (including, without limitation, the reasonable fees, expenses
and disbursements of Agent's internal appraisers, environmental advisors or
legal counsel) incurred by Agent at any time (whether prior to, on or after the
date of this Agreement) in connection with (i) its own audit and investigation
of Borrower and the Portfolio Properties provided that prior to an Event of
Default Borrower shall not be required to reimburse expenses for any inspections
of the Portfolio Properties by Agent's loan officers or other employees which
are made more frequently than annually; (ii) the negotiation, preparation and
execution of this Agreement (including, without limitation, the satisfaction or
attempted satisfaction of any of the conditions set forth in ARTICLE IV) and the
other Loan Documents and the making of the Loans; (iii) administration of this
Agreement, the other Loan Documents and the Loans, including, without
limitation, consultation with attorneys in connection therewith; and (iv) the
protection, collection or enforcement of any of the Obligations.
12.1.2 AFTER EVENT OF DEFAULT. Borrower further agrees to pay, or
reimburse Agent and Lenders, for all reasonable out-of-pocket costs and
expenses, including without limitation reasonable attorneys' fees and
disbursements incurred by Agent or Lenders after the occurrence of an Event of
Default (i) in enforcing any Obligation or exercising or enforcing any other
right or remedy available by reason of such Event of Default; (ii) in connection
with any refinancing or restructuring of the credit arrangements provided under
this Agreement in the nature of a "work-out" or in any insolvency or bankruptcy
proceeding; (iii) in commencing, defending or intervening in any litigation or
in filing a petition, complaint, answer, motion or other pleadings in any legal
proceeding relating to Borrower, the REIT or any Affiliate and related to or
arising out of the transactions contemplated hereby; or (iv) in taking any other
action in or with respect to any suit or proceeding (whether in bankruptcy or
otherwise).
12.2 INDEMNITY. Borrower further agrees to defend, protect, indemnify
and hold harmless Agent, each and all of the Lenders, each of their respective
Affiliates and participants and each of the respective officers, directors,
employees, agents, attorneys and consultants (including, without limitation,
those retained in connection with the satisfaction or attempted satisfaction of
any of the conditions set forth in ARTICLE IV) of each of the foregoing
(collectively called the "INDEMNITEES") from and against any and all Liabilities
and Costs imposed on, incurred by, or asserted against such Indemnitees (whether
based on any federal or state laws or other statutory regulations, including,
without limitation, securities and commercial laws and regulations, under common
law or in equity, and based upon contract or otherwise, including any
Liabilities and Costs arising as a result of a "prohibited transaction" under
ERISA to the extent arising from or in connection with the past, present or
future operations of the REIT or Borrower or their respective predecessors in
interest) in any manner relating to or arising out of this Agreement or the
other Loan Documents, or any act, event or transaction related or attendant
thereto, the making of and participation in the Loans and the management of the
Loans, or the use or intended use of the proceeds of the Loans (collectively,
the "INDEMNIFIED MATTERS"); PROVIDED, HOWEVER, that Borrower shall have no
obligation to an Indemnitee hereunder with respect to (i) matters for which such
Indemnitee has been compensated pursuant to or for which an exemption is
provided in SECTION 2.4.7 or any other provision of this Agreement, (ii)
Indemnified Matters to the extent caused by or resulting from the willful
misconduct or gross negligence of that Indemnitee, as determined by a court of
competent jurisdiction, and (iii) Indemnified Matters arising from any dispute
among the Lenders not attributable to the actions or omissions of Borrower or
the REIT. To the extent that the undertaking to indemnify, pay and hold harmless
set forth in the preceding sentence may be unenforceable because it is violative
of any law or public policy, Borrower shall contribute the maximum portion which
it is permitted to pay and satisfy under applicable law, to the payment and
satisfaction of all Indemnified Matters incurred by the Indemnitees. 12.3 CHANGE
IN ACCOUNTING PRINCIPLES. Except as otherwise provided herein, if any changes in
accounting principles from those used in the preparation of the most recent
financial statements delivered to Agent pursuant to the terms hereof are
hereinafter required or permitted by the rules, regulations, pronouncements and
opinions of the Financial Accounting Standards Board or the American Institute
of Certified Public Accountants (or successors thereto or agencies with similar
functions) and are adopted by the REIT or Borrower with the agreement of its
independent certified public accountants and such changes result in a change in
the method of calculation of any of the financial covenants, standards or terms
found herein, the parties hereto agree to enter into negotiations in order to
amend such provisions so as to equitably reflect such changes with the desired
result that the criteria for evaluating the financial condition of the REIT or
Borrower shall be the same after such changes as if such changes had not been
made; PROVIDED, HOWEVER, that no change in GAAP that would affect the method of
calculation of any of the financial covenants, standards or terms shall be given
effect in such calculations until such provisions are amended pursuant to
SECTION 12.4, to so reflect such change in accounting principles.
12.4 AMENDMENTS AND WAIVERS. (i) No amendment or modification of any
provision of this Agreement shall be effective without the written agreement of
Requisite Lenders (after notice to all Lenders) and Borrower (except for
amendments to SECTION 11.4.1 which do not require the consent of Borrower), and
(ii) no termination or waiver of any provision of this Agreement, or consent to
any departure by Borrower therefrom (except as expressly provided in SECTION
11.11.1 with respect to waivers of late fees), shall in any event be effective
without the written concurrence of Requisite Lenders (after notice to all
Lenders), which Requisite Lenders shall have the right to grant or withhold at
their sole discretion, EXCEPT THAT:
12.4.1 The following amendments, modifications or waivers shall
require the consent of all Lenders:
(a) increasing the Facility or increasing any Lender's
Commitment without the consent of the affected Lender;
(b) changing the principal amount or final maturity of
the Loans;
(c) reducing the interest rates applicable to the
Loans;
(d) reducing the rates on which fees payable pursuant
hereto are determined;
(e) forgiving or delaying any amount payable or
receivable under ARTICLE II (other than late fees);
(f) changing the definition of "Requisite Lenders",
"Pro Rata Shares" or "Event of Default";
(g) changing any provision contained in this SECTION
12.4;
(h) releasing any obligor or guarantor under any Loan
Document or amending the Guaranty to reduce the guarantor's liability
thereunder;
(i) consent to assignment by Borrower of all of its
duties and Obligations hereunder pursuant to SECTION 12.14; or
(j) changing any of the financial covenants set forth
in ARTICLE IX or any of the definitions used in the computation of
such covenants or waiving any failure of the Borrower to comply with
any one of such covenants for two or more consecutive Fiscal Quarters.
12.4.2 No amendment, modification, termination or waiver of any
provision of ARTICLE XI or any other provision referring to Agent shall be
effective without the written concurrence of Agent, but only if such amendment,
modification, termination or waiver alters the obligations or rights of Agent.
Any waiver or consent shall be effective only in the specific instance and for
the specific purpose for which it was given. No notice to or demand on Borrower
in any case shall entitle Borrower to any other further notice or demand in
similar or other circumstances. Any amendment, modification, termination, waiver
or consent effected in accordance with this SECTION 12.4 shall be binding on
each assignee, transferee or recipient of Agent's or any Lender's interest under
this Agreement or the Loans at the time outstanding.
12.5 INDEPENDENCE OF COVENANTS. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or be otherwise within the limitations of, another covenant shall not avoid
the occurrence of an Event of Default or Unmatured Event of Default if such
action is taken or condition exists, and if a particular action or condition is
expressly permitted under any covenant, unless expressly limited to such
covenant, the fact that it would not be permitted under the general provisions
of another covenant shall not constitute an Event of Default or Unmatured Event
of Default if such action is taken or condition exists.
12.6 NOTICES AND DELIVERY. Unless otherwise specifically provided
herein, any consent, notice or other communication herein required or permitted
to be given shall be in writing and may be personally served, telecopied or sent
by courier service or United States mail and shall be deemed to have been given
when delivered in person or by courier service, upon receipt of a telecopy (or
on the next Business Day if such telecopy is received on a non-Business Day or
after 5:00 p.m. (at the office of the recipient) on a Business Day) or four (4)
Business Days after deposit in the United States mail (registered or certified,
with postage prepaid and properly addressed). Notices to Agent pursuant to
ARTICLE II shall not be effective until received by Agent. For the purposes
hereof, the addresses of the parties hereto (until notice of a change thereof is
delivered as provided in this SECTION 12.6) shall be as set forth below each
party's name on the signature pages hereof, or, as to each party, at such other
address as may be designated by such party in a written notice to all of the
other parties. All deliveries to be made to Agent for distribution to the
Lenders shall be made to Agent at the addresses specified for notice on the
signature page hereto and in addition, a sufficient number of copies of each
such delivery shall be delivered to Agent for delivery to each Lender at the
address specified for deliveries on the signature page hereto or such other
address as may be designated by Agent in a written notice.
12.7 SURVIVAL OF WARRANTIES, INDEMNITIES AND AGREEMENTS. All
agreements, representations, warranties and indemnities made or given herein
shall survive the execution and delivery of this Agreement and the other Loan
Documents and the making and repayment of the Loans hereunder and such
indemnities shall survive termination hereof.
12.8 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES Cumulative. No failure
or delay on the part of Agent or any Lender in the exercise of any power, right
or privilege under any of the Loan Documents shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence therein,
nor shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other right, power or
privilege. All rights and remedies existing under the Loan Documents are
cumulative to and not exclusive of any rights or remedies otherwise available.
12.9 PAYMENTS SET ASIDE. To the extent that Borrower makes a payment
or payments to Agent or the Lenders or Agent or the Lenders exercise their
rights of setoff, and such payment or payments or the proceeds of such setoff or
any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, state or federal law, common law or
equitable cause, then to the extent of such recovery, the Obligation or part
thereof originally intended to be satisfied, and all rights and remedies
therefor, shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred.
12.10 SEVERABILITY. In case any provision in or obligation under this
Agreement or the other Loan Documents shall be invalid, illegal or unenforceable
in any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby, PROVIDED,
HOWEVER, that if the rates of interest or any other amount payable hereunder, or
the collectibility thereof, are declared to be or become invalid, illegal or
unenforceable, Lenders' obligations to make Loans shall not be enforceable.
12.11 HEADING. Section headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
12.12 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF
MASSACHUSETTS.
12.13 LIMITATION OF LIABILITY. To the extent permitted by applicable
law, no claim may be made by Borrower, any Lender or any other Person against
Agent or any Lender, or the affiliates, directors, officers, employees,
attorneys or agents of any of them, for any special, indirect, consequential or
punitive damages in respect of any claim for breach of contract or any other
theory of liability arising out of or related to the transactions contemplated
by this Agreement, or any act, omission or event occurring in connection
therewith; and Borrower and each Lender hereby waive, release and agree not to
xxx upon any claim for any such damages, whether or not accrued and whether or
not known or suspected to exist in its favor.
12.14 SUCCESSORS AND ASSIGNS. This Agreement and the other Loan
Documents shall be binding upon the parties hereto and their respective
successors and assigns and shall inure to the benefit of the parties hereto and
the successors and permitted assigns of Agent and Lenders. The terms and
provisions of this Agreement shall inure to the benefit of any assignee or
transferee of the Loans of Lenders under this Agreement, and in the event of
such transfer or assignment, the rights and privileges herein conferred upon
Agent and Lenders shall automatically extend to and be vested in such transferee
or assignee, all subject to the terms and conditions hereof. Borrower's rights
or any interest therein hereunder, and Borrower's duties and Obligations
hereunder, shall not be assigned without the consent of all Lenders.
12.15 CONSENT TO JURISDICTION AND SERVICE OF PROCESS; WAIVER OF JURY
TRIAL AND CERTAIN DAMAGE CLAIMS. ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST
BORROWER WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE, AND
ALL JUDICIAL PROCEEDINGS BROUGHT BY BORROWER WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT SHALL BE, BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION HAVING SITUS WITHIN THE COMMONWEALTH OF MASSACHUSETTS,
AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, BORROWER ACCEPTS, FOR ITSELF
AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE
JURISDICTION OF THE AFORESAID COURTS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY
FINAL JUDGMENT RENDERED THEREBY FROM WHICH NO APPEAL HAS BEEN TAKEN OR IS
AVAILABLE. BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO ITS NOTICE ADDRESS
SPECIFIED ON THE SIGNATURE PAGES HEREOF. BORROWER, AGENT AND LENDERS EACH
IRREVOCABLY WAIVES (i) TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, AND (ii) ANY OBJECTION (INCLUDING,
WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE GROUNDS
OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE. EXCEPT TO THE EXTENT EXPRESSLY
PROHIBITED BY LAW, THE BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR
RECOVER IN ANY ACTION OR PROCEEDING REFERRED TO IN THE PRECEDING SENTENCE ANY
SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN,
OR IN ADDITION TO, ACTUAL DAMAGES, INCLUDING ANY DAMAGES PURSUANT TO M.G.L.
C.93A ET SEQ. NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF AGENT OR ANY LENDER TO
BRING PROCEEDINGS AGAINST BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
12.16 COUNTERPARTS; EFFECTIVENESS; INCONSISTENCIES. This Agreement and
any amendments, waivers, consents or supplements may be executed in
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such together shall constitute but one and the same
instrument. This Agreement shall become effective when Borrower, the initial
Lenders and Agent have duly executed and delivered execution pages of this
Agreement to each other (delivery by Borrower to Lenders and by any Lender to
Borrower and any other Lender being deemed to have been made by delivery to
Agent). This Agreement and each of the other Loan Documents shall be construed
to the extent reasonable to be consistent one with the other, but to the extent
that the terms and conditions of this Agreement are actually and directly
inconsistent with the terms and conditions of any other Loan Document, this
Agreement shall govern.
12.17 CONSTRUCTION. The parties acknowledge that each party and its
counsel have reviewed and revised this Agreement and that the normal rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement or
any amendments or exhibits hereto.
12.18 OBLIGATIONS UNSECURED. It is the intent of the parties that the
Obligations shall constitute unsecured obligations of Borrower. Neither the
restrictions and prohibitions set forth herein with respect to the creation,
incurrence, assumption or existence of any Lien on any Property of Borrower or
any other Person, nor those set forth in any other Loan Document, are intended
to create or constitute a Lien of any nature upon any Property of Borrower or
any other Person, and no such restriction or prohibition shall be deemed to
constitute any such Lien. This SECTION 12.18 shall not be deemed to prevent the
Agent or any Lender from obtaining a Lien as security for the Obligations at any
time hereafter pursuant to a mutual agreement among the parties hereto expressly
providing for such Lien or during the continuance of any Event of Default.
12.19 ENTIRE AGREEMENT. This Agreement, taken together with all of the
other Loan Documents and all certificates and other documents delivered by
Borrower to Agent (including documents incorporating separate agreements
relating to the payment of fees), embodies the entire agreement and supersede
all prior agreements, written and oral, relating to the subject matter hereof.
IN WITNESS WHEREOF, this Agreement has been duly executed on the date
set forth above.
BORROWER: CHELSEA GCA REALTY PARTNERSHIP, L.P.,
a Delaware limited partnership
By: CHELSEA GCA REALTY, INC.,
a Maryland corporation, its general
partner
By____________________________
Its_________________________
ADDRESS FOR NOTICE AND DELIVERY:
000 Xxxxxxxxxx Xxxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx,
Senior Vice President
Tel: (000)000-0000
Fax: (000)000-0000
AGENT/LENDER: BANKBOSTON, N.A.
By_________________________________
Its______________________________
ADDRESS FOR NOTICE AND DELIVERY:
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Real Estate Division
with a copy to the following address:
000 Xxxxxxxxx Xxxxxx Xxxxx X.X.
Xxxxx 000
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Pro Rata Share: 20%
Loan Commitment: $12,000,000
LIBOR OFFICE:
BankBoston, N.A.
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
LENDER: KEYBANK NATIONAL ASSOCIATION
By_________________________________
Its______________________________
ADDRESS FOR NOTICE AND DELIVERY:
Address:
000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Pro Rata Share: 20%
Loan Commitment: $12,000,000
LIBOR OFFICE:
Address:
000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
LENDER: PNC BANK
By_________________________________
Its______________________________
ADDRESS FOR NOTICE AND DELIVERY:
Address:
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxxx Xxxxxxxxx, XX 00000
Attn: Xxxx XxXxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Pro Rata Share: 20%
Loan Commitment: $12,000,000
LIBOR OFFICE:
Address:
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxxx Xxxxxxxxx, XX 00000
Attn: Xxxx XxXxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
LENDER: NATIONSBANK, N.A.
By_______________________________
Printed Name_____________________
Title____________________________
ADDRESS FOR NOTICE AND DELIVERY:
Address: 000 Xxxxxxxxx Xxxxxx, X.X.
6th Floor, South
GA1-006-06-25
Xxxxxxx, XX 00000
Attn: S. Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Pro Rata Share: 20%
Loan Commitment: $12,000,000
LIBOR OFFICE:
Address: 000 Xxxxxxxxx Xxxxxx, X.X.
0xx Xxxxx, Xxxxx
Xxxxxxx, XX 00000
Attn: S. Xxxxx Xxxxxx
LENDER: COMMERZBANK AG, NEW YORK BRANCH
By_______________________________
Printed Name_____________________
Title____________________________
By_______________________________
Printed Name_____________________
Title____________________________
ADDRESS FOR NOTICE AND DELIVERY:
Address: Two World Financial Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx
Telephone:(000)000-0000
Telecopy: (000)000-0000
Pro Rata Share: 20%
Loan Commitment: $12,000,000
LIBOR OFFICE:
Address: Two World Financial Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx
