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REVOLVING CREDIT AGREEMENT
dated as of September 21, 1998
among
THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP,
as Borrower,
UBS AG, NEW YORK BRANCH,
as a Bank
and
UBS AG, NEW YORK BRANCH,
as Administrative Agent
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS; ETC..................................1
SECTION 1.01. Definitions.......................................1
SECTION 1.02. Accounting Terms.................................16
SECTION 1.03. Computation of Time Periods......................16
SECTION 1.04. Rules of Construction............................16
ARTICLE II THE LOANS........................................17
SECTION 2.01. The Loans........................................17
SECTION 2.02. Purpose..........................................17
SECTION 2.03. Advances, Generally..............................17
SECTION 2.04. Procedures for Advances..........................17
SECTION 2.05. Additional Conditions to Advances................18
SECTION 2.06. Interest Periods; Renewals.......................18
SECTION 2.07. Interest.........................................19
SECTION 2.08. Fees.............................................19
SECTION 2.09. Notes............................................19
SECTION 2.10. Prepayments......................................20
SECTION 2.11. Termination of Commitments.......................20
SECTION 2.12. Method of Payment................................20
SECTION 2.13. Elections, Conversions or Continuation of Loans..20
SECTION 2.14. Minimum Amounts..................................21
SECTION 2.15. Certain Notices Regarding Elections, Conversions
and Continuations of Loans.......................21
SECTION 2.16. Late Payment Premium.............................21
SECTION 2.17. Collateral for Loans.............................21
SECTION 2.18. Letters of Credit................................24
ARTICLE III YIELD PROTECTION; ILLEGALITY; ETC................25
SECTION 3.01. Additional Costs.................................25
SECTION 3.02. Limitation on Types of Loans.....................27
SECTION 3.03. Illegality.......................................27
SECTION 3.04. Treatment of Affected Loans......................27
SECTION 3.05. Certain Compensation.............................28
SECTION 3.06. Capital Adequacy.................................29
SECTION 3.07. Substitution of Banks............................29
ARTICLE IV CONDITIONS PRECEDENT.............................30
SECTION 4.01. Conditions Precedent to the Initial Advance......30
SECTION 4.02. Conditions Precedent to Advances After the Initial
Advance..........................................32
SECTION 4.03. Deemed Representations...........................32
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ARTICLE V REPRESENTATIONS AND WARRANTIES...................33
SECTION 5.01. Due Organization.................................33
SECTION 5.02. Power and Authority; No Conflicts; Compliance With
Laws.............................................33
SECTION 5.03. Legally Enforceable Agreements...................33
SECTION 5.04. Litigation.......................................33
SECTION 5.05. Good Title to Properties.........................34
SECTION 5.06. Taxes............................................34
SECTION 5.07. ERISA............................................34
SECTION 5.08. No Default on Outstanding Judgments or Orders....34
SECTION 5.09. No Defaults on Other Agreements..................34
SECTION 5.10. Government Regulation............................35
SECTION 5.11. Environmental Protection.........................35
SECTION 5.12. Solvency.........................................35
SECTION 5.13. Financial Statements.............................35
SECTION 5.14. Valid Existence of Affiliates....................35
SECTION 5.15. Insurance........................................35
SECTION 5.16. Schedule A and B Assets..........................35
SECTION 5.17. Accuracy of Information; Full Disclosure.........36
ARTICLE VI AFFIRMATIVE COVENANTS............................36
SECTION 6.01. Maintenance of Existence.........................36
SECTION 6.02. Maintenance of Records...........................36
SECTION 6.03. Maintenance of Insurance.........................36
SECTION 6.04. Compliance with Laws; Payment of Taxes...........36
SECTION 6.05. Right of Inspection..............................37
SECTION 6.06. Compliance With Environmental Laws...............37
SECTION 6.07. Payment of Costs.................................37
SECTION 6.08. Maintenance of Properties........................37
SECTION 6.09. Reporting and Miscellaneous Document
Requirements.....................................37
ARTICLE VII NEGATIVE COVENANTS...............................39
SECTION 7.01. Mergers Etc......................................39
SECTION 7.02. Investments......................................39
SECTION 7.03. Sale of Assets...................................40
SECTION 7.04. Interest Rate Hedging............................40
SECTION 7.05. Partnership Committee of Borrower................40
SECTION 7.06. Disposition or Encumbrance of Certain Assets.....40
SECTION 7.07. Amendments to Separation Agreement...............41
SECTION 7.08. Certain Restrictions on Activities of TCI........41
ARTICLE VIII FINANCIAL COVENANTS AND ADJUSTMENTS..............41
SECTION 8.01. Covenants Prior to Certain Events................41
SECTION 8.02. Covenants Subsequent to Certain Events...........42
SECTION 8.03. Certain Pro-Forma Adjustments....................43
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ARTICLE IX EVENTS OF DEFAULT................................44
SECTION 9.01. Events of Default................................44
SECTION 9.02. Remedies.........................................46
ARTICLE X ADMINISTRATIVE AGENT; RELATIONS AMONG
BANKS............................................46
SECTION 10.01. Appointment, Powers and Immunities of
Administrative Agent.............................46
SECTION 10.02. Reliance by Administrative Agent.................47
SECTION 10.03. Defaults.........................................47
SECTION 10.04. Rights of Administrative Agent as a Bank.........48
SECTION 10.05. Indemnification of Administrative Agent..........48
SECTION 10.06. Non-Reliance on Administrative Agent and Other
Banks............................................48
SECTION 10.07. Failure of Administrative Agent to Act...........49
SECTION 10.08. Resignation or Removal of Administrative Agent...49
SECTION 10.09. Amendments Concerning Agency Function............49
SECTION 10.10. Liability of Administrative Agent................49
SECTION 10.11. Transfer of Agency Function......................50
SECTION 10.12. Non-Receipt of Funds by Administrative Agent.....50
SECTION 10.13. Withholding Taxes................................50
SECTION 10.14. Minimum Commitment by UBS........................50
SECTION 10.15. Pro Rata Treatment...............................51
SECTION 10.16. Sharing of Payments Among Banks..................51
SECTION 10.17. Possession of Documents..........................51
ARTICLE XI NATURE OF OBLIGATIONS............................51
SECTION 11.01. Absolute and Unconditional Obligations...........51
SECTION 11.02. Non-Recourse to TRG Partners.....................52
ARTICLE XII MISCELLANEOUS....................................52
SECTION 12.01. Binding Effect of Request for Advance............52
SECTION 12.02. Amendments and Waivers...........................53
SECTION 12.03. Usury............................................53
SECTION 12.04. Expenses; Indemnification........................53
SECTION 12.05. Assignment; Participation........................55
SECTION 12.06. Documentation Satisfactory.......................57
SECTION 12.07. Notices..........................................57
SECTION 12.08. Setoff...........................................57
SECTION 12.09. Year 2000........................................57
SECTION 12.10. Table of Contents; Headings......................58
SECTION 12.11. Severability.....................................58
SECTION 12.12. Counterparts.....................................58
SECTION 12.13. Integration......................................58
SECTION 12.14. GOVERNING LAW....................................58
SECTION 12.15. Waivers..........................................58
SECTION 12.16. JURISDICTION; IMMUNITIES.........................58
iii
EXHIBIT A - Assignment and Assumption Agreement
EXHIBIT B - Authorization Letter
EXHIBIT C - Note
EXHIBIT D - List of Affiliates
EXHIBIT E - Solvency Certificate
SCHEDULE A - Schedule A Assets
SCHEDULE B - Schedule B Assets
i
REVOLVING CREDIT AGREEMENT ("this Agreement") dated as of September 21,
1998 among THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP, a limited partnership
organized and existing under the laws of the State of Delaware ("Borrower"), UBS
AG, NEW YORK BRANCH, as agent for the Banks (in such capacity, together with its
successors in such capacity, "Administrative Agent"), and UBS AG, NEW YORK
BRANCH (in its individual capacity and not as Administrative Agent, "UBS") (UBS
and the lenders who from time to time become Banks pursuant to Section 3.07 or
12.05, each a "Bank" and collectively, the "Banks").
Borrower desires that the Banks extend credit as provided herein, and
the Banks are prepared to extend such credit. Accordingly, Borrower, each Bank
and Administrative Agent agree as follows:
ARTICLE I
DEFINITIONS; ETC.
SECTION 1.01. Definitions. As used in this Agreement the following
terms have the following meanings (except as otherwise provided, terms defined
in the singular to have a correlative meaning when used in the plural and vice
versa):
"Administrative Agent" has the meaning specified in the preamble.
"Administrative Agent's Office" means Administrative Agent's address
located at 299 Park Avenue, New York, NY 10171, or such other address in the
United States as Administrative Agent may designate by written notice to
Borrower and the Banks.
"Affiliate" means, with respect to any Person (the "first Person"),
any other Person (1) which directly or indirectly controls, or is controlled by,
or is under common control with the first Person or (2) 10% or more of the
beneficial interest in which is directly or indirectly owned or held by the
first Person. The term "control" means the possession, directly or indirectly,
of the power, alone, to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract, or otherwise.
"Agreement" means this Revolving Credit Agreement, as amended,
supplemented or modified from time to time.
"Applicable Commitment Fee Rate" means (1) prior to such time as the
Loans become secured in accordance with Section 2.17, the respective rates per
annum determined, at any time, based on the Leverage Ratio at the time, in
accordance with Table I below (any change in the Leverage Ratio, including any
change pursuant to Section 2.05, causing it to move to a different range on said
Table I shall effect an immediate change in the Applicable Commitment Fee Rate)
and (2) subsequent to such time as the Loans become secured in accordance with
Section 2.17, the respective rates per annum determined, at any time, based on
the Collateral Property Debt Yield at the time, in accordance with Table II
below (any change in the Collateral Property Debt Yield, including any change
pursuant to Section 2.05, causing it to move to a different range on said Table
II shall effect an immediate change in the Applicable Commitment Fee Rate).
TABLE I
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Applicable Commitment
Leverage Ratio Fee Rate - unsecured (% per annum)
-------------- ----------------------------------
Less than or equal to 50% 0.20%
Greater than 50% 0.25%
TABLE II
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Applicable Commitment
Collateral Property Debt Yield Fee Rate - secured (% per annum)
------------------------------ --------------------------------
Greater than 15% 0.20%
Less than or equal to 15% 0.25%
"Applicable Lending Office" means, for each Bank and for its LIBOR Loan
or Base Rate Loan, as applicable, the lending office of such Bank (or of an
Affiliate of such Bank) designated as such on its signature page hereof or in
the applicable Assignment and Assumption Agreement, or such other office of such
Bank (or of an Affiliate of such Bank) as such Bank may from time to time
specify to Administrative Agent and Borrower as the office by which its LIBOR
Loan or Base Rate Loan, as applicable, is to be made and maintained.
2
"Applicable Margin" means (1) with respect to Base Rate Loans and LIBOR
Loans prior to such time as the Loans become secured in accordance with Section
2.17, the respective rates per annum determined, at any time, based on the
Leverage Ratio at the time, in accordance with Table I below (any change in the
Leverage Ratio, including any change pursuant to Section 2.05, causing it to
move to a different range on said Table I shall effect an immediate change in
the Applicable Margin) and (2) with respect to Base Rate Loans and LIBOR Loans
subsequent to such time as the Loans become secured in accordance with Section
2.17, the respective rates per annum determined, at any time, based on the
Collateral Property Debt Yield at the time, in accordance with Table II below
(any change in the Collateral Property Debt Yield, including any change pursuant
to Section 2.05, causing it to move to a different range on said Table II shall
effect an immediate change in the Applicable Margin ).
TABLE I
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Applicable Margin Applicable Margin
for Base Rate Loans - for LIBOR Loans
Leverage Ratio unsecured (% per annum) unsecured (% per annum)
-------------- ----------------------- -----------------------
Less than or equal to 50% -0- 1.15
Greater than 50% -0- 1.30
TABLE II
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Applicable Margin for Applicable Margin
Base Rate Loans - for LIBOR Loans -
Collateral Property Debt Yield secured (% per annum) secured (% per annum)
- ------------------------------ --------------------- ---------------------
Greater than 15% -0- 0.90
Less than or equal to 15% -0- 1.05
"Assignee" has the meaning specified in Section 12.05.
"Assignment and Assumption Agreement" means an Assignment and
Assumption Agreement, substantially in the form of EXHIBIT A, pursuant to which
a Bank assigns and an Assignee assumes rights and obligations in accordance with
Section 12.05.
"Authorization Letter" means a letter agreement executed by Borrower in
the form of EXHIBIT B.
"Bank" and "Banks" have the respective meanings specified in the
preamble.
3
"Bank Parties" means Administrative Agent and the Banks.
"Banking Day" means (1) any day on which commercial banks are not
authorized or required to close in New York City and (2) whenever such day
relates to a LIBOR Loan, an Interest Period with respect to a LIBOR Loan, or
notice with respect to a LIBOR Loan, a day on which dealings in Dollar deposits
are also carried out in the London interbank market and banks are open for
business in London.
"Base Rate" means, for any day, the higher of (1) the Federal Funds
Rate for such day plus 0.50% or (2) the Prime Rate for such day.
"Base Rate Loan" means all or any portion (as the context requires) of
a Bank's Loan which shall accrue interest at a rate determined in relation to
the Base Rate.
"Bonds" means the senior unsecured notes of Borrower in the principal
amount of $708,000,000 issued pursuant to the Amended and Restated Indenture
dated March 4, 1994 between Borrower and The Chase Manhattan Bank, as successor
to Chemical Bank, as trustee.
"Borrower's Accountants" means Deloitte & Touche, or such other
accounting firm(s) selected by Borrower and reasonably acceptable to the
Required Banks.
"Borrower" has the meaning specified in the preamble.
"Capital Lease" means any lease which has been or should be capitalized
on the books of the lessee in accordance with GAAP.
"Capitalization Value" means, at any time, the sum of (1) Combined
EBITDA for the twelve (12)-month period ending with the most recently ended
calendar quarter, capitalized at an annual rate equal to 8.00%, (2) Borrower's
beneficial share of unrestricted Cash and Cash Equivalents (i. e., Cash and Cash
Equivalents that are not pledged or the use of which is not restricted by the
terms of any document or agreement) of Borrower and its Consolidated Businesses
and UJVs and (3) without duplication, the cost basis of properties of Borrower
under development. For the purposes of this definition, in no event shall (x)
properties under development constitute in excess of 15% of Capitalization Value
or (y) leasing commissions payable by third parties and/or management and
development fees contribute to greater than 5% of Capitalization Value.
"Cash and Cash Equivalents" means (1) cash, (2) marketable direct
obligations issued or unconditionally guaranteed by the United States government
and backed by the full faith and credit of the United States government, (3)
domestic and Eurodollar certificates of deposit and time deposits, bankers'
acceptances and floating rate certificates of deposit issued by any commercial
bank organized under the Laws of the United States, any state thereof or the
District of Columbia, any foreign bank, or its branches or agencies (fully
protected against currency fluctuations), which, at the time of acquisition, are
rated A-1 or better by S&P or P-1 or better by Moody's, provided that the
maturities thereof shall not exceed one (1) year from the
4
date of acquisition and (4) shares of Fidelity Institutional Money Market Fund
or comparable money market funds.
"Closing Date" means the date this Agreement has been executed by all
parties.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral Properties" means those Schedule A Assets which are given
as security for the Loans pursuant to Section 2.17.
"Collateral Property Debt Yield" means, for any calendar quarter, the
ratio (expressed as a percentage) of (1) Collateral Property EBITDA for the
twelve (12)-month period ending with such calendar quarter to (2) the
outstanding principal balance under the Notes, plus the total outstanding amount
of Letters of Credit as of the end of such calendar quarter.
"Collateral Property EBITDA" means that portion of the Combined EBITDA
attributable to the Collateral Properties.
"Collateral Property Owners" means the Affiliates of Borrower that own
the respective Collateral Properties.
"Columbus UDAG Loan" means the UDAG mortgage loan in the current
principal amount of $7,858,786 to TL - Columbus Associates regarding Columbus
City Center.
"Combined EBITDA" means, for any period of time, (1) revenues less
operating costs (including general and administrative expenses) before interest,
depreciation and amortization and unusual items for Borrower and its
Consolidated Businesses (including, without limitation, non-recurring items such
as gains or losses from asset sales) and adjusted to eliminate the effects of
straight lining of rents plus (2) Borrower's beneficial interest in revenues
less operating costs (including general and administrative expenses) before
interest, depreciation and amortization and unusual items (after eliminating
appropriate intercompany amounts) (including, without limitation, non-recurring
items such as gains or losses from asset sales) and adjusted to eliminate the
effects of straight lining of rents applicable to each of the UJVs. For purposes
of this definition, gains or losses from peripheral land sales, to the extent
such gains or losses total less than $5,000,000 in any twelve (12)-month period,
shall be treated in accordance with the accounting principles reflected in
Borrower's form 10-K for 1997.
"Consolidated Businesses" means, collectively (1) each Affiliate of
Borrower, all of the equity interests of which are, or, under GAAP, are deemed
to be, owned by Borrower and (2) Taub-Co Management Inc., The Taubman Company
Limited Partnership and their respective Affiliates so long as more than 90% of
the equity interests in the entities referred to in this clause (2) are owned
directly or indirectly by Borrower.
"Consolidated Outstanding Indebtedness" means, as of any time, all
indebtedness and liability for borrowed money (which shall be deemed to include
obligations as lessee under Capital Leases), secured or unsecured, of Borrower
and all indebtedness and liability for
5
borrowed money (which shall be deemed to include obligations as lessee under
Capital Leases), secured or unsecured, attributable to Borrower's beneficial
interest in its Consolidated Businesses, including mortgage and other notes
payable but excluding any indebtedness which is margin indebtedness secured by
cash and cash equivalent securities, as reflected in the TRG Consolidated
Financial Statements.
"Contingent Liabilities" means the sum of (1) those liabilities, as
determined in accordance with GAAP, set forth and quantified as contingent
liabilities in the notes to the TRG Consolidated Financial Statements and (2)
contingent liabilities, other than those described in the foregoing clause (1),
which represent direct payment guaranties of Borrower; provided, however, that
Contingent Liabilities shall exclude contingent liabilities which represent the
"Other Party's Share" of "Duplicated Obligations" (as such quoted terms are
hereinafter defined). "Duplicated Obligations" means, collectively, all those
payment guaranties in respect of Debt of UJVs for which Borrower and another
party are jointly and severally liable, where the other party is, in the sole
judgment of the Required Banks, capable of satisfying the Other Party's Share of
such obligation; and "Other Party's Share" means such other party's fractional
beneficial interest in the UJV in question.
"Continue", "Continuation" and "Continued" refer to the continuation
pursuant to Section 2.13 of a LIBOR Loan as a LIBOR Loan from one Interest
Period to the next Interest Period.
"Convert", "Conversion" and "Converted" refer to a conversion pursuant
to Section 2.13 of a Base Rate Loan into a LIBOR Loan or a LIBOR Loan into a
Base Rate Loan, each of which may be accompanied by the transfer by a Bank (at
its sole discretion) of all or a portion of its Loan from one Applicable Lending
Office to another.
"Debt" means (1) indebtedness or liability for borrowed money, or for
the deferred purchase price of property or services (including trade
obligations), (2) obligations as lessee under Capital Leases, (3) current
liabilities in respect of unfunded vested benefits under any Plan, (4)
obligations under letters of credit issued for the account of any Person, (5)
all obligations arising under bankers' or trade acceptance facilities, (6) all
guarantees, endorsements (other than for collection or deposit in the ordinary
course of business), and other contingent obligations to purchase any of the
items included in this definition, to provide funds for payment, to supply funds
to invest in any Person, or otherwise to assure a creditor against loss, (7) all
obligations secured by any Lien on property owned by the Person whose Debt is
being measured, whether or not the obligations have been assumed and (8) all
obligations under any agreement providing for contingent participation or other
hedging mechanisms with respect to interest payable on any of the items
described above in this definition.
"Default" means any event which with the giving of notice or lapse of
time, or both, would become an Event of Default.
"Default Rate" means a rate per annum equal to (1) with respect to Base
Rate Loans, a variable rate 3% above the rate of interest then in effect thereon
(including the Applicable Margin) and (2) with respect to LIBOR Loans, a fixed
rate 3% above the rate(s) of
6
interest in effect thereon (including the Applicable Margin) at the time of
Default until the end of the then current Interest Period therefor and,
thereafter, a variable rate 3% above the rate of interest for a Base Rate Loan
(including the Applicable Margin).
"Disposition" means a sale (whether by assignment, transfer or Capital
Lease) of an asset.
"Distributable Cash Flow" means Funds From Operations.
"Dollars" and the sign "$" mean lawful money of the United States of
America.
"Elect", "Election" and "Elected" refer to election, if any, by
Borrower pursuant to Section 2.13 to have all or a portion of an advance of the
Loans be outstanding as LIBOR Loans.
"Environmental Discharge" means any discharge or release of any
Hazardous Materials in violation of any applicable Environmental Law.
"Environmental Law" means any Law relating to pollution or the
environment, including Laws relating to noise or to emissions, discharges,
releases or threatened releases of Hazardous Materials into the work place, the
community or the environment, or otherwise relating to the generation,
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials.
"Environmental Notice" means any written complaint, order, citation,
letter, inquiry, notice or other written communication from any Person (1)
affecting or relating to Borrower's compliance with any Environmental Law in
connection with any activity or operations at any time conducted by Borrower,
(2) relating to the occurrence or presence of or exposure to or possible or
threatened or alleged occurrence or presence of or exposure to Environmental
Discharges or Hazardous Materials at any of Borrower's locations or facilities,
including, without limitation, (a) the existence of any contamination or
possible or threatened contamination at any such location or facility and (b)
remediation of any Environmental Discharge or Hazardous Materials at any such
location or facility or any part thereof; and (3) any violation or alleged
violation of any relevant Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, including any rules and regulation promulgated
thereunder.
"ERISA Affiliate" means any corporation or trade or business which is a
member of the same controlled group of organizations (within the meaning of
Section 414(b) of the Code) as Borrower or is under common control (within the
meaning of Section 414(c) of the Code) with Borrower.
"Event of Default" has the meaning specified in Section 9.01.
"Federal Funds Rate" means, for any day, the rate per annum (expressed
on a 360- day basis of calculation) equal to the weighted average of the rates
on overnight federal funds
7
transactions as published by the Federal Reserve Bank of New York for such day
provided that (1) if such day is not a Banking Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the immediately preceding
Banking Day as so published on the next succeeding Banking Day and (2) if no
such rate is so published on such next succeeding Banking Day, the Federal Funds
Rate for such day shall be the average of the rates quoted by three (3) Federal
Funds brokers to Administrative Agent on such day on such transactions.
"Fiscal Year" means each period from January 1 to December 31.
"Fixed Charges" means, for any period of time, the sum of (1) Interest
Expense, (2) dividends payable on preferred equity interests and (3) all
scheduled principal payments made or required to be made during such period on
Debt of Borrower and that attributable to Borrower's beneficial interest in its
Consolidated Business and UJVs, excluding, however, balloon payments of
principal due upon the stated maturity of any such Debt.
"Funds From Operations" means, for any period of time, net income of
Borrower and its Consolidated Businesses, as determined in accordance with GAAP,
excluding gains (or losses) from debt restructuring and sales of property and
without taking into account straight- lining of rents, plus depreciation related
to real estate and amortization, less amounts distributed by Borrower as
preferred distributions, and after adjustments to reflect Borrower's pro rata
share of UJVs (which will be calculated to reflect Funds From Operations on the
same basis). For purposes of this definition, gains or losses from peripheral
land sales, to the extent such gains or losses total less than $5,000,000 in any
twelve (12)-month period, shall be treated in accordance with the accounting
principles reflected in Borrower's form 10-K for 1997.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect from time to time, applied on a basis consistent
with those used in the preparation of the financial statements referred to in
Section 5.13 (except for changes concurred in by Borrower's Accountants).
"GMPT Borrower" means a single purpose entity or entities, at least
99.9% owned and controlled (directly or indirectly) by GMPTS and otherwise
satisfactory to Administrative Agent, which will be the indirect owner of a 100%
interest in the Schedule B Assets following the consummation of the Unit
Redemption Transaction.
"GMPTS" means GMPTS Limited Partnership, a Delaware limited
partnership, presently a general partner of Borrower owning 50,025,713
partnership units representing an approximately 37.3% interest therein.
"Good Faith Contest" means the contest of an item if (1) the item is
diligently contested in good faith, and, if appropriate, by proceedings timely
instituted, (2) adequate reserves are established with respect to the contested
item, (3) during the period of such contest, the enforcement of any contested
item is effectively stayed and (4) the failure to pay or comply with the
contested item during the period of the contest is not likely to result in a
Material Adverse Change.
8
"Governmental Approvals" means any authorization, consent, approval,
license, permit, certification, or exemption of, registration or filing with or
report or notice to, any Governmental Authority.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Hazardous Materials" means any pollutant, effluents, emissions,
contaminants, toxic or hazardous wastes or substances, as any of those terms are
defined from time to time in or for the purposes of any relevant Environmental
Law, including asbestos fibers and friable asbestos, polychlorinated biphenyls,
and any petroleum or hydrocarbon-based products or derivatives.
"Indemnity" and "Indemnities" have the respective meanings specified in
Section 2.17.
"Initial Advance" means the first advance of proceeds of the Loans.
"Interest Expense" means, for any period of time, the consolidated
interest expense (without deduction of consolidated interest income) of Borrower
and its Consolidated Businesses, including, without limitation or duplication
(or, to the extent not so included, with the addition of), (1) the portion of
any rental obligation in respect of any Capital Lease obligation allocable to
interest expense in accordance with GAAP, (2) the amortization of Debt
discounts, (3) any payments or receipts (other than up-front fees) with respect
to interest rate swap or similar agreements, (4) any dividends attributable to
any equity security which may be converted into a debt security of Borrower at
any time or is mandatorily redeemable for cash within twenty (20) years from its
initial issuance and (5) the interest expense and items listed in clauses (1)
through (4) above applicable to each of the UJVs multiplied by Borrower's
respective beneficial interests in the UJVs (it being understood that the items
listed in clauses (1), (2) and (3) above shall be considered part of Interest
Expense even if, due to a change in GAAP, such items would no longer be
considered interest expense under GAAP).
"Interest Period" means, with respect to any LIBOR Loan, the period
commencing on the date the same is advanced, converted from a Base Rate Loan or
Continued, as the case may be, and ending, as Borrower may select pursuant to
Section 2.06, on the numerically corresponding day in the first, second or third
calendar month thereafter, provided that, in any case, each such Interest Period
which commences on the last Banking Day of a calendar month (or on any day for
which there is no numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Banking Day of the appropriate calendar
month.
"Law" means any federal, state or local statute, law, rule, regulation,
ordinance, order, code, or rule of common law, now or hereafter in effect, and
any judicial or administrative interpretation thereof by a Governmental
Authority or otherwise, including any judicial or administrative order, consent
decree or judgment.
9
"Leverage Ratio" means the ratio, expressed as a percentage, of Total
Outstanding Indebtedness to Capitalization Value.
"LIBOR Base Rate" means, with respect to any Interest Period therefor,
the rate per annum (rounded upwards if necessary to the nearest 1/16 of 1%)
quoted at approximately 11:00 a.m., New York time, by UBS two (2) Banking Days
prior to the first day of such Interest Period for the offering to leading banks
in the London interbank market of Dollar deposits in immediately available
funds, for a period, and in an amount, comparable to such Interest Period and
principal amount of the LIBOR Loan in question outstanding during such Interest
Period.
"LIBOR Interest Rate" means, for any LIBOR Loan, a rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) determined by
Administrative Agent to be equal to the quotient of (1) the LIBOR Base Rate for
such LIBOR Loan for the Interest Period therefor divided by (2) one minus the
LIBOR Reserve Requirement for such LIBOR Loan for such Interest Period.
"LIBOR Loan" means all or any portion (as the context requires) of any
Bank's Loan which shall accrue interest at rate(s) determined in relation to
LIBOR Interest Rate(s).
"LIBOR Reserve Requirement" means, for any LIBOR Loan, the rate at
which reserves (including any marginal, supplemental or emergency reserves) are
actually required to be maintained during the Interest Period for such LIBOR
Loan under Regulation D by the applicable Bank against "Eurocurrency
liabilities" (as such term is used in Regulation D). Without limiting the effect
of the foregoing, the LIBOR Reserve Requirement shall also reflect any other
reserves actually required to be maintained by any Bank by reason of any
Regulatory Change against (1) any category of liabilities which includes
deposits by reference to which the LIBOR Base Rate is to be determined as
provided in the definition of "LIBOR Base Rate" in this Section 1.01 or (2) any
category of extensions of credit or other assets which include loans the
interest rate on which is determined on the basis of rates referred to in said
definition of "LIBOR Base Rate".
"Lien" means any mortgage, deed of trust, pledge, security interest,
hypothecation, assignment for collateral purposes, deposit arrangement, lien
(statutory or other), or other security agreement or charge of any kind or
nature whatsoever of any third party (excluding any right of setoff but
including, without limitation, any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the filing of any financing statement under the
Uniform Commercial Code or comparable Law of any jurisdiction to evidence any of
the foregoing).
"Loan" and "Loans" have the respective meanings specified in Section
2.01.
10
"Loan Commitment" means, with respect to each Bank, the obligation to
make a Loan in the principal amount set forth below or in the applicable
Assignment and Assumption Agreement, as such amount may be modified from time to
time in accordance with the provisions of Section 2.11, 3.07 or 12.05:
Bank Loan Commitment
---- ---------------
UBS $200,000,000
Total $200,000,000
============
"Loan Documents" means this Agreement, the Notes and the Solvency
Certificate and, following such time as the Loans become secured pursuant to
Section 2.17, the Mortgages and the Indemnities.
"Material Adverse Change" means either (1) a material adverse change in
the status of the business, results of operations, financial condition, property
or prospects of Borrower or (2) any event or occurrence of whatever nature which
is likely to have a material adverse effect on the ability of Borrower to
perform its obligations under the Loan Documents.
"Maturity Date" means September 21, 2001.
"Moody's" means Moody's Investors Service, Inc.
"Mortgage" and "Mortgages" have the respective meanings specified in
Section 2.17.
"Multiemployer Plan" means a Plan defined as such in Section 3(37) of
ERISA to which contributions have been made by Borrower or any ERISA Affiliate
and which is covered by Title IV of ERISA.
"Net Worth" means the excess of Capitalization Value over Total
Outstanding Indebtedness.
"Note" and "Notes" have the respective meanings specified in Section
2.09.
"Obligations" means each and every obligation, covenant and agreement
of Borrower, now or hereafter existing, contained in this Agreement, and any of
the other Loan Documents, whether for principal, reimbursement obligations,
interest, fees, expenses, indemnities or otherwise, and any amendments or
supplements thereto, extensions or renewals thereof or replacements therefor,
including but not limited to all indebtedness, obligations and liabilities of
Borrower to Administrative Agent and any Bank now existing or hereafter incurred
under or arising out of or in connection with the Notes, this Agreement, the
other Loan Documents, and any documents or instruments executed in connection
therewith; in each case whether direct or indirect, joint or several, absolute
or contingent, liquidated or unliquidated, now or hereafter existing, renewed or
restructured, whether or not from time to time decreased or
11
extinguished and later increased, created or incurred, and including all
indebtedness of Borrower, under any instrument now or hereafter evidencing or
securing any of the foregoing.
"Parent" means, with respect to any Bank, any Person controlling such
Bank.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.
"Plan" means any employee benefit or other plan established or
maintained, or to which contributions have been made, by Borrower or any ERISA
Affiliate of Borrower and which is covered by Title IV of ERISA or to which
Section 412 of the Code applies.
"presence", when used in connection with any Environmental Discharge or
Hazardous Materials, means and includes presence, generation, manufacture,
installation, treatment, use, storage, handling, repair, encapsulation,
disposal, transportation, spill, discharge and release.
"Prime Rate" means that rate of interest from time to time announced by
UBS at its Principal Office as its prime commercial lending rate.
"Principal Office" means the principal office of UBS, presently located
at 299 Park Avenue, New York, New York 10171.
"Pro Rata Share" means, for purposes of this Agreement and with respect
to each Bank, a fraction, the numerator of which is the amount of such Bank's
Loan Commitment and the denominator of which is the Total Loan Commitment.
"Prohibited Transaction" means any transaction set forth in Section 406
of ERISA or Section 4975 of the Code.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System, as the same may be amended or supplemented from time to
time, or any similar Law from time to time in effect.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as the same may be amended or supplemented from time to
time.
"Regulatory Change" means, with respect to any Bank, any change after
the date of this Agreement in United States federal, state, municipal or foreign
laws or regulations (including Regulation D) or the adoption or making after
such date of any interpretations, directives or requests applying to a class of
banks including such Bank of or under any United States, federal, state,
municipal or foreign laws or regulations (whether or not having the force of
12
law) by any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"Related Bridge Loan" means the loan in the amount of up to
$430,000,000 to Borrower pursuant to a Credit Agreement, dated as of the date
hereof, among Borrower, UBS and the other lenders, if any, identified therein,
and UBS, as administrative agent for said lenders.
"Related Bridge Term Loan" means the loan in the amount of $902,000,000
to Borrower pursuant to a Term Loan Agreement, dated as of the date hereof,
among Borrower, UBS and the other lenders, if any, identified therein, and UBS,
as administrative agent for said lenders.
"Related Loan Banks" means the "Banks" under the credit agreement(s)
governing the Related Loans.
"Related Loan Commitments" means the commitments of the Related Loan
Banks to make the Related Loans.
"Related Loans" means the Related Bridge Loan and, until the
consummation of the Unit Redemption Transaction, the Related Bridge Term Loan.
"Reportable Event" means any of the events set forth in Section 4043(b)
of ERISA.
"Required Banks" means at any time the Banks and Related Loan Banks
having Loan Commitments and/or Related Loan Commitments the aggregate
outstanding plus unfunded amounts of which are equal to at least 66-2/3% of the
aggregate outstanding plus unfunded amounts of all the Loan Commitments and
Related Loan Commitments; provided, however, that during the existence of an
Event of Default, the "Required Banks" shall be the Banks and/or Related Loan
Banks holding at least 66-2/3% of the then aggregate unpaid principal amount of
the Loans and the Related Loans.
"Restricted Payment" has the meaning specified in Section 8.01(6).
"Schedule A Assets" means those assets of Borrower identified in
SCHEDULE A.
"Schedule B Assets" means those assets of Borrower identified in
SCHEDULE B. Following the consummation of the Unit Redemption Transaction,
references in this Agreement to the "Schedule B Assets" shall be disregarded.
"Secured Indebtedness" means that portion of Total Outstanding
Indebtedness that is secured.
13
"Separation Agreement" means, collectively, the Separation and Relative
Value Adjustment Agreement dated August 17, 1998 between Borrower and GMPTS,
together with the two (2) related side letters of even date therewith from
Borrower and agreed to and accepted by GMPTS, as the same may be modified to the
extent permitted by Section 7.07.
"Solvency Certificate" means a certificate in substantially the form of
EXHIBIT E, to be delivered by Borrower pursuant to the terms of this Agreement.
"Solvent" means, when used with respect to any Person, that (1) the
fair value of the property of such Person, on a going concern basis, is greater
than the total amount of liabilities (including, without limitation, contingent
liabilities) of such Person, (2) the present fair saleable value of the assets
of such Person, on a going concern basis, is not less than the amount that will
be required to pay the probable liabilities of such Person on its debts as they
become absolute and matured, (3) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such Person's ability to
pay as such debts and liabilities mature, (4) such Person is not engaged in
business or a transaction, and is not about to engage in business or a
transaction, for which such Person's property would constitute unreasonably
small capital after giving due consideration to the prevailing practice in the
industry in which such Person is engaged and (5) such Person has sufficient
resources, provided that such resources are prudently utilized, to satisfy all
of such Person's obligations. Contingent liabilities will be computed at the
amount that, in light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies.
"Specified Credit Facilities" means, collectively, (1) the unsecured
revolving credit facility of up to $300,000,000 from UBS and other lenders to
Borrower made pursuant to an Amended and Restated Revolving Loan Agreement dated
as of March 5, 1997, as amended, (2) the unsecured credit facility of up to
$100,000,000 from UBS to Borrower made pursuant to an Unsecured Loan Agreement
dated as of July 27, 1998, (3) the Stoneridge Mortgage Loan and the Columbus
UDAG Loan.
"Stoneridge Mortgage Loan" means the mortgage loan in the original
principal amount of $75,000,000 from The First National Bank of Chicago and J.G.
Finley, as Trustee, to Stoneridge Properties.
"Supplemental Fee Letter" means that certain letter agreement, dated
the date hereof, between UBS and Borrower.
"TCI" means Taubman Centers, Inc., a Michigan corporation, Borrower's
managing general partner.
"TCI Financial Statements" means the consolidated balance sheet and
related consolidated statement of operations, accumulated deficiency in assets
and cash flows, and footnotes thereto, of TCI, prepared in accordance with GAAP.
14
"Total Loan Commitment" means the sum of the Loan Commitments of all
the Banks.
"Total Outstanding Indebtedness" means the sum, without duplication, of
(1) Consolidated Outstanding Indebtedness, (2) TRG's Share of UJV Combined
Outstanding
Indebtedness and (3) Contingent Liabilities.
"TRG Consolidated Financial Statements" means the consolidated balance
sheet and related consolidated statement of operations, accumulated deficiency
in assets and cash flows, and footnotes thereto, of Borrower, prepared in
accordance with GAAP.
"TRG's Share of UJV Combined Outstanding Indebtedness" means the sum of
the indebtedness of each of the UJVs contributing to UJV Combined Outstanding
Indebtedness multiplied by Borrower's respective beneficial interests in each
such UJV.
"UBS" has the meaning specified in the preamble.
"UJV Combined Outstanding Indebtedness" means, as of any time, all
indebtedness and liability for borrowed money (which shall be deemed to include
obligations as lessee under Capital Leases), secured or unsecured, of the UJVs,
including mortgage and other notes payable but excluding any indebtedness which
is margin indebtedness secured by cash and cash equivalent securities, as
reflected in the balance sheets of each of the UJVs, prepared in accordance with
GAAP.
"UJVs" means the unconsolidated joint ventures in which Borrower owns a
beneficial interest and which are accounted for under the equity method in the
TRG Consolidated Financial Statements.
"Unencumbered Combined EBITDA" means that portion of Combined EBITDA
attributable to Unencumbered Wholly-Owned Assets.
"Unencumbered Wholly-Owned Assets" means assets, reflected on the TRG
Consolidated Financial Statements, wholly owned, directly or indirectly, by
Borrower and not subject to any Lien to secure all or any portion of Secured
Indebtedness; provided, however, that, for purposes of this definition only, the
loans described in the following table, so long as the documents in respect of
the same permit secondary financing, shall not be considered part of Secured
Indebtedness:
Description of
Debt Obligation Obligor Affected Asset Amount ($)
- ---- ---------- ------- -------------- ----------
Assessment Bonds - Richmond Associates Hilltop land 413,727
City of Richmond
Assessment Bonds - Stoneridge Properties Stoneridge land 1,200,400
CIty of Pleasanton
Assessment Bonds - Biltmore Shopping Biltmore land 2,978,584
City of Phoenix Center Partners
15
"Unit Redemption Transaction" means the transaction whereby all of
GMPTS's partnership units in Borrower will be redeemed in exchange for the
Schedule B Assets, (2) GMPT Borrower shall assume certain indebtedness relating
to the Schedule B Assets and (3) Borrower shall assign to GMPT Borrower, and
GMPT Borrower shall assume, all of Borrower's rights and obligations under the
Related Bridge Term Loan, all in accordance with the Separation Agreement, which
Unit Redemption Transaction is anticipated by Borrower and GMPTS to be
consummated on or after September 30, 1998 and in connection with which Unit
Redemption Transaction Borrower's agreement of limited partnership shall be
amended and restated.
"Unsecured Debt Yield" means, for any calendar quarter, the ratio
(expressed as a percentage) of (1) Unencumbered Combined EBITDA for the twelve
(12)-month period ending with such calendar quarter to (2) Unsecured
Indebtedness as of the end of such calendar quarter.
"Unsecured Indebtedness" means that portion of Total Outstanding
Indebtedness that is unsecured.
"Woodfield Mortgage Loan" means the mortgage loan, in the original
principal amount of $172,000,000 from Morgan Guaranty Trust Company of New York,
as Trustee, with respect to the Woodfield shopping center, and the related
interest rate hedging agreement.
SECTION 1.02. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP, and all financial
data required to be delivered hereunder shall be prepared in accordance with
GAAP.
SECTION 1.03. Computation of Time Periods. Except as otherwise provided
herein, 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 words "to" and "until" each means "to but excluding".
SECTION 1.04. Rules of Construction. Except as otherwise provided or
indicated, when used in this Agreement (1) "or" is not exclusive, (2) a
reference to a Law includes any amendment or modification to such Law, (3) a
reference to a Person includes its permitted successors and permitted assigns,
(4) all references to the singular shall include the plural and vice versa, (5)
a reference to an agreement, instrument or document shall include such
agreement, instrument or document as the same may be amended, modified or
supplemented from time to time in accordance with its terms and as permitted by
the Loan Documents, (6) all references to Articles, Sections, Exhibits or
Schedules shall be to Articles and Sections of, and Exhibits and Schedules to,
this Agreement, (7) "hereunder", "herein", "hereof" and the like refer to this
Agreement as a whole and (8) all Exhibits and Schedules to this Agreement shall
be incorporated into this Agreement.
16
ARTICLE II
THE LOANS
SECTION 2.01. The Loans. Subject to the terms and conditions of this
Agreement, each of the Banks severally agrees to make a loan to Borrower (each
such loan by a Bank, a "Loan"; such loans, collectively, the "Loans") pursuant
to which each Bank shall from time to time advance and re-advance to Borrower an
amount equal to the excess of the amount of such Bank's Loan Commitment over the
amount of all previous advances made by such Bank under its Loan Commitment
which remain unpaid. For purposes of the immediately preceding sentence, a
Bank's Pro Rata Share of the amount of outstanding Letters of Credit shall be
deemed to be advanced. Within the limits set forth herein, Borrower may borrow
from time to time under this Section 2.01 and prepay from time to time pursuant
to Section 2.10 (subject, however, to the restrictions on prepayment set forth
in such Section) and thereafter re-borrow pursuant to this Section 2.01.
The Loans may be outstanding as (1) Base Rate Loans, (2) LIBOR Loans or
(3) a combination of the foregoing, as Borrower shall elect and notify
Administrative Agent in accordance with Section 2.15. The LIBOR Loan and Base
Rate Loan of each Bank shall be maintained at such Bank's Applicable Lending
Office for its LIBOR Loan and Base Rate Loan, respectively.
The obligations of the Banks under this Agreement are several, and no
Bank shall be responsible for the failure of any other Bank to make any advance
of a Loan to be made by such other Bank. However, the failure of any Bank to
make any advance of the Loan to be made by it hereunder on the date specified
therefor shall not relieve any other Bank of its obligation to make any advance
of its Loan specified hereby to be made on such date.
SECTION 2.02. Purpose. Borrower shall use the proceeds of the Loans for
general partnership purposes of Borrower and its Consolidated Businesses and
UJVs, including costs incurred in connection with acquisitions. In no event
shall proceeds of the Loans be used for any illegal purpose or for the purpose,
whether immediate, incidental or ultimate, of buying or carrying "margin stock"
within the meaning of Regulation U.
SECTION 2.03. Advances, Generally. The Initial Advance shall be made
upon satisfaction of the conditions set forth in Section 4.01. Subsequent
advances shall be made no more frequently than weekly upon satisfaction of the
conditions set forth in Section 4.02. The amount of each advance subsequent to
the Initial Advance shall be in the minimum amount of $2,000,000 (unless less
than $2,000,000 is available for disbursement pursuant to the terms hereof at
the time of any subsequent advance, in which case the amount of such subsequent
advance shall be equal to such remaining availability) and in integral multiples
of $100,000 above such amount.
SECTION 2.04. Procedures for Advances. Borrower shall submit to
Administrative Agent a request for each advance hereunder, stating the amount
requested and certifying the purpose for which such advance is to be used, no
later than 10:00 a.m. (New York time) on the date three (3) Banking Days prior
to the date the advance is to be made.
17
Administrative Agent, upon its receipt and approval of the requisite documents
for the advance, will so notify the Banks either by telephone or by facsimile.
Not later than 10:00 a.m. (New York time) on the date of each advance, each Bank
shall, through its Applicable Lending Office and subject to the conditions of
this Agreement, make the amount to be advanced by it on such day available to
Administrative Agent, at Administrative Agent's Office and in immediately
available funds for the account of Borrower. The amount so received by
Administrative Agent shall, subject to the conditions of this Agreement, be made
available to Borrower, in immediately available funds, by Administrative Agent's
crediting an account of Borrower designated by Borrower and maintained with
Administrative Agent at Administrative Agent's Office.
SECTION 2.05. Additional Conditions to Advances. Each advance of the
Loans shall be subject, in addition to the other limitations and conditions set
forth herein, to, at Administrative Agent's request, Administrative Agent's
receipt of a certificate, of the sort required by paragraph (3)(b) of Section
6.09, which shall demonstrate Borrower's compliance, as of the end of the most
recently ended calendar quarter for which financial results are required
hereunder to have been reported by Borrower (and taking into account pro-forma
adjustments for all acquisitions and Dispositions subsequent to the end of such
quarter required to be reported pursuant to paragraph (7) of Section 6.09), with
all covenants enumerated in said paragraph (3)(b), assuming that the amount that
will be outstanding under the Loans following the making of the advance that is
being requested was outstanding as of the end of such most recently ended
calendar quarter.
For purposes of the definitions of the "Applicable Commitment Fee Rate"
and "Applicable Margin" in Section 1.01, the Leverage Ratio and Collateral
Property Debt Yield shall be adjusted in accordance with the foregoing covenant
compliance calculations as of the date of each advance of the Loans and upon
each acquisition and Disposition required to be reported pursuant to paragraph
(7) of Section 6.09.
SECTION 2.06. Interest Periods; Renewals. In the case of the LIBOR
Loans, Borrower shall select an Interest Period of any duration in accordance
with the definition of Interest Period in Section 1.01, subject to the following
limitations: (1) no Interest Period may extend beyond the Maturity Date, (2) if
an Interest Period would end on a day which is not a Banking Day, such Interest
Period shall be extended to the next Banking Day, unless such Banking Day would
fall in the next calendar month, in which event such Interest Period shall end
on the immediately preceding Banking Day and (3) only five (5) discrete segments
of a Bank's Loan bearing interest at a LIBOR Interest Rate, for a designated
Interest Period, pursuant to a particular Election, Conversion or Continuation,
may be outstanding at any one time (each such segment of each Bank's Loan
corresponding to a proportionate segment of each of the other Banks' Loans).
Upon notice to Administrative Agent as provided in Section 2.15,
Borrower may Continue any LIBOR Loan on the last day of the Interest Period of
the same or different duration in accordance with the limitations provided
above. If Borrower shall fail to give notice to Administrative Agent of such a
Continuation, such LIBOR Loan shall automatically become a Base Rate Loan on the
last day of the current Interest Period.
18
SECTION 2.07. Interest. Borrower shall pay interest to Administrative
Agent for the account of the applicable Bank on the outstanding and unpaid
principal amount of the Loans, at a rate per annum as follows: (1) for Base Rate
Loans at a rate equal to the Base Rate plus the Applicable Margin and (2) for
LIBOR Loans at a rate equal to the applicable LIBOR Interest Rate plus the
Applicable Margin. Any principal amount not paid when due (when scheduled, at
acceleration or otherwise) shall bear interest thereafter, payable on demand, at
the Default Rate.
The interest rate on Base Rate Loans shall change when the Base Rate
changes. Interest on Base Rate Loans and LIBOR Loans shall not exceed the
maximum amount permitted under applicable law. Interest shall be calculated for
the actual number of days elapsed on the basis of, in the case of Base Rate
Loans and LIBOR Loans, three hundred sixty (360) days.
Accrued interest shall be due and payable in arrears upon and with
respect to any prepayment of principal and on the first Banking Day of each
calendar month; provided, however, that interest accruing at the Default Rate
shall be due and payable on demand.
SECTION 2.08. Fees. (a) Borrower shall during the term of the Loans,
pay to Administrative Agent for the account of each Bank a commitment fee
computed on the daily unused Loan Commitment of such Bank (it being understood
that the amount of outstanding Letters of Credit shall be considered "used" for
this purpose), at a rate per annum equal to the daily Applicable Commitment Fee
Rate, calculated on the basis of a year of three hundred sixty (360) days for
the actual number of days elapsed. The accrued commitment fees shall be due and
payable in arrears on the first Banking Day of each month after the Closing
Date, and upon the Maturity Date or earlier termination of the Loan Commitments.
(b) Borrower shall pay to Administrative Agent, for the accounts of the
parties specified therein, the fees provided for, on the dates specified, in the
Supplemental Fee Letter.
SECTION 2.09. Notes. The Loan made by each Bank under this Agreement
shall be evidenced by, and repaid with interest in accordance with, a promissory
note of Borrower in the form of EXHIBIT C duly completed and executed by
Borrower, in a principal amount equal to such Bank's Loan Commitment, payable to
such Bank for the account of its Applicable Lending Office (each such note, as
the same may hereafter be amended, modified, extended, severed, assigned,
substituted, renewed or restated from time to time, including any substitute
note pursuant to Section 3.07 or 12.05, a "Note"; all such notes, collectively,
the "Notes"). The Notes shall mature, and all outstanding principal and accrued
interest and other sums thereunder shall be paid in full, on the Maturity Date,
as the same may be accelerated.
Each Bank is hereby authorized by Borrower to endorse on the schedule
attached to the Notes held by it, the amount of each advance, and each payment
of principal received by such Bank for the account of its Applicable Lending
Office(s) on account of its Loan, which endorsement shall, in the absence of
manifest error, be conclusive as to the outstanding balance of the Loan made by
such Bank. The failure by any Bank to make such notations with respect to its
Loan or each advance or payment shall not limit or otherwise affect the
obligations of Borrower under this Agreement or the Notes.
19
SECTION 2.10. Prepayments. Borrower may, upon at least one (1) Banking
Day's notice to Administrative Agent in the case of the Base Rate Loans, and at
least two (2) Banking Days' notice to Administrative Agent in the case of LIBOR
Loans, prepay the Loans, provided that (1) any partial prepayment under this
Section shall be in integral multiples of $1,000,000, (2) a LIBOR Loan may be
prepaid only on the last day of the Applicable Interest Period for such LIBOR
Loan and (3) each prepayment under this Section shall include all interest
accrued on the amount of principal prepaid through the date of prepayment.
SECTION 2.11. Termination of Commitments. (a) At any time, Borrower
shall have the right, without premium or penalty, to terminate the unused Loan
Commitments, in whole or in part, from time to time, provided that (1) Borrower
shall give notice of each such termination to Administrative Agent, specifying
the amount of the termination, no later then 10:00 a.m. (New York time) on the
date which is fifteen (15) days prior to the effectiveness of such termination,
(2) the Loan Commitments of each of the Banks must be terminated ratably and
simultaneously with those of the other Banks and (3) each partial termination of
the Loan Commitments as a whole (and corresponding reduction of the Total Loan
Commitment) shall be in an integral multiple of $1,000,000.
(b) The Loan Commitments, to the extent terminated, may not be
reinstated.
SECTION 2.12. Method of Payment. Borrower shall make each payment under
this Agreement and under the Notes not later than 11:00 a.m. (New York time) on
the date when due in Dollars to Administrative Agent at Administrative Agent's
Office in immediately available funds. Administrative Agent will thereafter, on
the day of its receipt of each such payment, cause to be distributed to each
Bank (1) such Bank's appropriate share (based upon the respective outstanding
principal amounts and rate(s) of interest under the Notes of the Banks) of the
payments of principal and interest in like funds for the account of such Bank's
Applicable Lending Office and (2) fees payable to such Bank in accordance with
the terms of this Agreement. Borrower hereby authorizes Administrative Agent and
the Banks, if and to the extent payment by Borrower is not made when due under
this Agreement or under the Notes, to charge from time to time against any
account Borrower maintains with Administrative Agent or any Bank any amount so
due to Administrative Agent and/or the Banks.
Except to the extent provided in this Agreement, whenever any payment
to be made under this Agreement or under the Notes is due on any day other than
a Banking Day, such payment shall be made on the next succeeding Banking Day,
and such extension of time shall in such case be included in the computation of
the payment of interest and other fees, as the case may be.
SECTION 2.13. Elections, Conversions or Continuation of Loans. Subject
to the provisions of Article III and Sections 2.06 and 2.14, Borrower shall have
the right to Elect to have all or a portion of any advance of the Loans be LIBOR
Loans, to Convert Base Rate Loans into LIBOR Loans, to Convert LIBOR Loans into
Base Rate Loans, or to Continue LIBOR Loans as LIBOR Loans, at any time or from
time to time, provided that (1) Borrower shall give Administrative Agent notice
of each such Election, Conversion or Continuation as provided in
20
Section 2.15 and (2) a LIBOR Loan may be Converted or Continued only on the last
day of the applicable Interest Period for such LIBOR Loan. Except as otherwise
provided in this Agreement, each Election, Continuation and Conversion shall be
applicable to each Bank's Loan in accordance with its Pro Rata Share.
SECTION 2.14. Minimum Amounts. With respect to the Loans as a whole,
each Election and each Conversion shall be in an amount at least equal to
$2,000,000 and in integral multiples of $100,000.
SECTION 2.15. Certain Notices Regarding Elections, Conversions and
Continuations of Loans. Notices by Borrower to Administrative Agent of
Elections, Conversions and Continuations of LIBOR Loans shall be irrevocable and
shall be effective only if received by Administrative Agent not later than 10:00
a.m. (New York time) on the number of Banking Days prior to the date of the
relevant Election, Conversion or Continuation specified below:
Number of
Notice Banking Days Prior
- ------ ------------------
Conversions into Base Rate Loans two (2)
Election of, Conversions into or Continuations as, LIBOR Loans three (3)
Promptly following its receipt of any such notice, Administrative Agent shall so
advise the Banks either by telephone or by facsimile. Each such notice of
Election shall specify the portion of the amount of the advance that is to be
LIBOR Loans (subject to Section 2.14) and the duration of the Interest Period
applicable thereto (subject to Section 2.06); each such notice of Conversion
shall specify the LIBOR Loans or Base Rate Loans to be Converted; and each such
notice of Conversion or Continuation shall specify the date of Conversion or
Continuation (which shall be a Banking Day), the amount thereof (subject to
Section 2.14) and the duration of the Interest Period applicable thereto
(subject to Section 2.06). In the event that Borrower fails to Elect to have any
portion of an advance be LIBOR Loans, the entire amount of such advance shall
constitute Base Rate Loans. In the event that Borrower fails to Continue LIBOR
Loans within the time period and as otherwise provided in this Section, such
LIBOR Loans will be automatically Converted into Base Rate Loans on the last day
of the then current applicable Interest Period for such LIBOR Loans.
SECTION 2.16. Late Payment Premium. Borrower shall, at Administrative
Agent's option, pay to Administrative Agent for the account of the Banks a late
payment premium in the amount of 4% of any payments of interest under the Loans
made more than fifteen (15) days after the due date thereof, which shall be due
with any such late payment.
SECTION 2.17. Collateral for Loans. Borrower covenants and agrees that,
within thirty (30) days following the earliest to occur of (x) the maturity date
of the Related Bridge Loan and the Related Bridge Term Loan, as the same may be
accelerated, (y) the
21
repayment in full of the Related Bridge Loan and the Related Bridge Term Loan
and the cancellation of the loan commitments of the lenders thereof and (z) the
repayment in full of the Related Bridge Loan and the cancellation of the loan
commitments of the lenders of the Related Bridge Term Loan and the assumption of
the Related Bridge Term Loan by GMPT Borrower as contemplated by the Term Credit
Agreement governing the same, it will deliver to Administrative Agent, for the
benefit of the Banks, (A) an amendment and restatement of this Agreement, duly
executed by Borrower, which will, inter alia, add customary mortgage and
property-related representations, covenants, conditions and defaults, (B)
certified copies of all documents evidencing partnership action taken by
Borrower and the Collateral Property Owners authorizing the execution, delivery
and performance of the Mortgages, the Indemnities and each other document to be
delivered by or on behalf of Borrower pursuant to this Section, (C) a
certificate of Borrower's managing general partner, or a similar certificate
with respect to each of the Collateral Property Owners, certifying the names and
true signatures of each individual authorized to sign the Mortgages, the
Indemnities and all related documents on behalf of Borrowers or the respective
Collateral Property Owner, (D) a Solvency Certificate, duly executed, from
Borrower and each Collateral Property Owner, (E) a certificate, of the sort
required by paragraph 3(b) of Section 6.09, containing calculations
demonstrating Borrower's compliance, as of the end of the most recently ended
calendar quarter with the covenants set forth in Section 8.02 (6) and (7) and
(F) the following with respect to each of the Schedule A Assets then owned by
Borrower (other than those that have been encumbered with the Required Banks'
consent in accordance with Section 7.06), all of said requirements at Borrower's
expense and each in form and substance reasonably satisfactory to Administrative
Agent:
(1) a mortgage (or deed of trust), assignment of leases and rents
and security agreements (each, a "Mortgage" and collectively, the
"Mortgages") and related Uniform Commercial Code Financing Statements, each
duly executed by the appropriate Collateral Property Owner and in proper
form for recording or filing, as the case may be, in the appropriate
records;
(2) an agreement (each, an "Indemnity" and collectively, the
"Indemnities") whereby the Banks and Administrative Agent are indemnified
regarding Hazardous Materials, duly executed by Borrower and the
appropriate Collateral Property Owner;
(3) a paid title insurance policy, in the amount of the Mortgage,
which shall insure the Mortgage to be a valid first lien on the appropriate
Collateral Property Owner's interest in the property covered thereby, free
and clear of all liens, defects, encumbrances and exceptions except those
reasonably approved (in light of the normal and customary Liens,
encumbrances and exceptions found on title to comparable regional shopping
center properties and not prohibited under Section 7.06) by Administrative
Agent, and shall contain (i) a reference to the survey required below but
no material survey exceptions, (ii) a pending disbursements clause and
(iii) such affirmative insurance and endorsements as Administrative Agent
may reasonably require; and shall be accompanied by such reinsurance
agreements as Administrative Agent may require;
(4) a current ALTA survey, certified to Administrative Agent and
the title insurer, showing (i) the location of the perimeter of the
property by courses and distances,
22
(ii) all easements, rights-of-way, and utility lines referred to in the
title policy required above or which actually service or cross the property
(with instrument, book and page number indicated), (iii) the lines of the
streets abutting the property and the width thereof, and any established
building lines (and that such roads are public roads), (iv) any
encroachments and the extent thereof upon the property, (v) locations of
all portions (with the acreage thereof also identified) of the property
which are located in an area designated as a "flood prone area" as defined
by U.S. Department of Housing and Urban Development pursuant to the Flood
Disaster Protection Act of 1973 and (vi) all improvements thereon, and the
relationship thereof by distances to the perimeter of the property,
established building lines and street lines;
(5) an independent M.A.I. appraisal, which appraisal shall comply
in all respects with the standards for real estate appraisals established
pursuant to the Financial Institutions Reform, Recovery, and Enforcement
Act of 1989;
(6) copies of the policies and originals of the certificates of
hazard and other insurance required by the Mortgage on such property,
together with evidence of the payment of the premiums therefor;
(7) a detailed report and certification by a properly qualified
engineer with regard to Hazardous Materials affecting the property, which
shall include, inter alia, a certification that such engineer has obtained
and examined a list of prior owners, tenants and other users of the
property, and has made an on-site physical examination of the property and
improvements thereon, and a visual observation of the surrounding areas,
and disclosing the extent of past or present Hazardous Materials activities
or of the presence of Hazardous Materials;
(8) a detailed report from an engineering consultant to the effect
that all improvements on the property are in satisfactory condition and
enumerating any maintenance or governmental compliance items necessary or
expected to be incurred over the remaining term of the Loans and stating
the approximate cost thereof;
(9) copies of any and all certificates of occupancy and similar
authorizations required by Governmental Authorities for the use, occupancy
and operation of the property and/or the improvements thereon;
(10) copies, certified by Borrower to be true and complete, of all
leases of the property, accompanied by, in the case of such leases as are
reasonably requested by Administrative Agent (i) estoppel certificates from
the tenants thereunder (to the extent such estoppel certificates are
obtainable with Borrower's commercially reasonable efforts, it being
understood that if Borrower shall not have obtained any such estoppel
certificates using such efforts prior to the granting of the Mortgage,
Borrower covenants to continue to use such efforts to obtain such estoppel
certificates), (ii) notices of assignment, and (iii) to the extent in
Borrower's possession or otherwise obtainable with reasonable effort,
current financial statements of the tenants (and guarantors of the tenants'
obligations, if applicable) thereunder;
23
(11) a copy, certified by Borrower to be true and complete, of any
reciprocal easement and operating agreement (and related agreements)
affecting the property, together with estoppel certificates with respect
thereto from the parties thereto (to the extent such estoppel certificates
are obtainable with Borrower's commercially reasonable efforts, it being
understood that if Borrower shall not have obtained any such estoppel
certificates using such efforts prior to the granting of the Mortgage,
Borrower covenants to continue to use such efforts to obtain such estoppel
certificates), and, if in Borrower's possession or otherwise obtainable
with reasonable effort, current financial statements of such parties;
(12) copies, certified by Borrower to be true and complete, of all
existing contracts providing for the management or leasing of the property
or any improvements thereon, together with, in each case, such collateral
assignments or "will-serve" letters as Administrative Agent may reasonably
require;
(13) favorable opinions of counsel for Borrower and the
appropriate Collateral Property Owner as to (i) the due authorization,
execution and enforceability of the Mortgage and Indemnity and (ii) such
other matters as Administrative Agent may reasonably request;
(14) Uniform Commercial Code searches with respect to Borrower and
the appropriate Collateral Property Owner and advice from the title insurer
to the effect that searches of the proper public records disclose no leases
of personalty (other than leases made in the ordinary course of business)
or financing statements filed or recorded against Borrower or such
Collateral Property Owner or the property covered by the Mortgage, other
than those reasonably approved by Administrative Agent;
(15) good standing, and, if required, foreign qualification,
certificates for Borrower and the appropriate Collateral Property Owner
from the jurisdiction where the property is located;
(16) current financial/operating statements, certified by Borrower
to be true and complete; and
(17) such other documents, instruments, materials, opinions or
assurances as Administrative Agent may reasonably request.
SECTION 2.18. Letters of Credit. (a) Borrower, the Banks and
Administrative Agent acknowledge that Administrative Agent has issued the
following two (2) irrevocable letters of credit for the account of Borrower: No.
SBY502898, dated July 22, 1994, in the original amount of $5,654,571, for the
benefit of Morgan Guaranty Trust Company of New York, as Trustee, and No.
SBY505218, dated August 19, 1997, in the original amount of $3,049,481, for the
benefit of Palm Beach County Board of County Commissioners (each, a "Letter of
Credit"; said letters of credit, collectively, the "Letters of Credit").
24
(b) In connection with each Letter of Credit, Borrower hereby covenants
to pay to Administrative Agent the following fees, each payable quarterly in
arrears (on the first Banking Day of each calendar quarter): (i) a fee, payable
to Administrative Agent for the account of the Banks, computed daily on the
amount of the Letter of Credit issued and outstanding at a rate per annum equal
to the "Banks' L/C Fee Rate" (as hereinafter defined) and (ii) a fee, payable to
Administrative Agent for its own account, computed daily on the amount of the
Letter of Credit issued and outstanding at a rate per annum of 0.125%. For
purposes of this Agreement, the "Banks' L/C Fee Rate" shall mean, at any time, a
rate per annum equal to the Applicable Margin for LIBOR Loans less 0.125% per
annum. It is understood and agreed that the last installment of the fees
provided for in this paragraph (b) with respect to any particular Letter of
Credit shall be due and payable on the first day of the calendar quarter
following the return, undrawn, or cancellation of such Letter of Credit.
(c) The parties hereto acknowledge and agree that, immediately upon
notice from Administrative Agent of any drawing under a Letter of Credit, each
Bank shall, notwithstanding the existence of a Default or Event of Default or
the non-satisfaction of any conditions precedent to the making of an advance of
the Loans, advance proceeds of its Loan, in an amount equal to its Pro Rata
Share of such drawing, which advance shall be made to Administrative Agent to
reimburse Administrative Agent, for its own account, for such drawing. Each of
the Banks further acknowledges that its obligation to fund its Pro Rata Share of
drawings under Letters of Credit as aforesaid shall survive the Banks'
termination of this Agreement or enforcement of remedies hereunder or under the
other Loan Documents.
(d) Borrower agrees, upon the occurrence of an Event of Default and at
the request of Administrative Agent, (i) to deposit with Administrative Agent
cash collateral in the amount of all the outstanding Letters of Credit, which
cash collateral shall be held by Administrative Agent as security for Borrower's
obligations in connection with the Letters of Credit and (ii) to execute and
deliver to Administrative Agent such documents as Administrative Agent requests
to confirm and perfect the assignment of such cash collateral to Administrative
Agent.
ARTICLE III
YIELD PROTECTION; ILLEGALITY; ETC.
SECTION 3.01. Additional Costs. Borrower shall pay directly to each
Bank from time to time on demand such amounts as such Bank may determine to be
necessary to compensate it for any increased costs which such Bank determines
are attributable to its making or maintaining a LIBOR Loan, or its obligation to
make or maintain a LIBOR Loan, or its obligation to Convert a Base Rate Loan to
a LIBOR Loan hereunder, or any reduction in any amount receivable by such Bank
hereunder in respect of its LIBOR Loan or such obligations (such increases in
costs and reductions in amounts receivable being herein called "Additional
Costs"), in each case resulting from any Regulatory Change which:
25
(1) changes the basis of taxation of any amounts payable to such
Bank under this Agreement or the Notes in respect of any such LIBOR Loan
(other than changes in the rate of general corporate, franchise, branch
profit, net income or other income tax imposed on such Bank or its
Applicable Lending Office by the jurisdiction in which such Bank has its
principal office or such Applicable Lending Office); or
(2) (other than to the extent the LIBOR Reserve Requirement is
taken into account in determining the LIBOR Rate at the commencement of the
applicable Interest Period) imposes or modifies any reserve, special
deposit, deposit insurance or assessment, minimum capital, capital ratio or
similar requirements relating to any extensions of credit or other assets
of, or any deposits with or other liabilities of, such Bank (including any
LIBOR Loan or any deposits referred to in the definition of "LIBOR Interest
Rate" in Section 1.01), or any commitment of such Bank (including such
Bank's Loan Commitment hereunder); or
(3) imposes any other condition affecting this Agreement or the
Notes (or any of such extensions of credit or liabilities).
Notwithstanding the foregoing, in the event that any Bank determines that it
shall incur Additional Costs in maintaining a LIBOR Loan, such Bank shall
provide written notice thereof to Borrower (with a copy to Administrative
Agent), which notice shall include the dollar amount of the Additional Costs,
and Borrower shall have the option, which option must be exercised within five
(5) Banking Days of Borrower's receipt of such notice, to prepay such LIBOR Loan
or to Convert such LIBOR Loan into a Base Rate Loan, subject, however, to the
provisions of Section 3.05.
Without limiting the effect of the provisions of the first paragraph of
this Section, in the event that, by reason of any Regulatory Change, any Bank
either (1) incurs Additional Costs based on or measured by the excess above a
specified level of the amount of a category of deposits of other liabilities of
such Bank which includes deposits by reference to which the LIBOR Interest Rate
is determined as provided in this Agreement or a category of extensions of
credit or other assets of such Bank which includes loans based on the LIBOR
Interest Rate or (2) becomes subject to restrictions on the amount of such a
category of liabilities or assets which it may hold, then, if such Bank so
elects by notice to Borrower (with a copy to Administrative Agent), the
obligation of such Bank to permit Elections of, to Continue, or to Convert Base
Rate Loans into, LIBOR Loans shall be suspended (in which case the provisions of
Section 3.04 shall be applicable) until such Regulatory Change ceases to be in
effect.
Determinations and allocations by a Bank for purposes of this Section
of the effect of any Regulatory Change pursuant to the first or second paragraph
of this Section, on its costs or rate of return of making or maintaining its
Loan or portions thereof or on amounts receivable by it in respect of its Loan
or portions thereof, and the amounts required to compensate such Bank under this
Section, shall be conclusive absent manifest error.
To the extent that changing the jurisdiction of a Bank's Applicable
Lending Office would have the effect of minimizing Additional Costs, each such
Bank shall use reasonable
26
efforts to make such a change, provided that same would not otherwise be
disadvantageous to each such Bank.
No Bank shall be entitled to any compensation pursuant to this Section
relating to any period more than ninety (90) days prior to the date notice
thereof is given to Borrower by such Bank.
SECTION 3.02. Limitation on Types of Loans. Anything herein to the
contrary notwithstanding, if, on or prior to the determination of the LIBOR
Interest Rate for any Interest Period:
(1) Administrative Agent determines (which determination shall be
conclusive) that quotations of interest rates for the relevant deposits
referred to in the definition of "LIBOR Interest Rate" in Section 1.01 are
not being provided in the relevant amounts or for the relevant maturities
for purposes of determining rates of interest for the LIBOR Loans as
provided in this Agreement; or
(2) a Bank determines (which determination shall be conclusive)
and promptly notifies Administrative Agent that the relevant rates of
interest referred to in the definition of "LIBOR Interest Rate" in Section
1.01 upon the basis of which the rate of interest for LIBOR Loans for such
Interest Period is to be determined do not adequately cover the cost to
such Bank of making or maintaining such LIBOR Loan for such Interest
Period;
then Administrative Agent shall give Borrower prompt notice thereof, and so long
as such condition remains in effect, the Banks (or, in the case of the
circumstances described in clause (2) above, the affected Bank) shall be under
no obligation to permit Elections of LIBOR Loans, to Convert Base Rate Loans
into LIBOR Loans or to Continue LIBOR Loans and Borrower shall, on the last
day(s) of the then current Interest Period(s) for the affected outstanding LIBOR
Loans, either (x) prepay the affected LIBOR Loans or (y) Convert the affected
LIBOR Loans into Base Rate Loans in accordance with Section 2.13.
SECTION 3.03. Illegality. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Bank or its Applicable
Lending Office to honor its obligation to make or maintain a LIBOR Loan
hereunder, to allow Elections of a LIBOR Loan or to Convert a Base Rate Loan
into a LIBOR Loan, then such Bank shall promptly notify Administrative Agent and
Borrower thereof and such Bank's obligation to make or maintain a LIBOR Loan, or
to permit Elections of, to Continue, or to Convert its Base Rate Loan into, a
LIBOR Loan shall be suspended (in which case the provisions of Section 3.04
shall be applicable) until such time as such Bank may again make and maintain a
LIBOR Loan.
SECTION 3.04. Treatment of Affected Loans. If the obligations of any
Bank to permit an Election of a LIBOR Loan, to Continue its LIBOR Loan, or to
Convert its Base Rate Loan into a LIBOR Loan, are suspended pursuant to Sections
3.01 or 3.03 (each LIBOR Loan so affected being herein called an "Affected
Loan"), such Bank's Affected Loan shall be automatically Converted into a Base
Rate Loan on the last day of the then current Interest Period
27
for the Affected Loan (or, in the case of a Conversion required by Sections 3.01
or 3.03, on such earlier date as such Bank may specify to Borrower).
To the extent that such Bank's Affected Loan has been so Converted, all
payments and prepayments of principal which would otherwise be applied to such
Bank's Affected Loan shall be applied instead to its Base Rate Loan and such
Bank shall have no obligation to Convert its Base Rate Loan into a LIBOR Loan.
In the event that the conditions giving rise to the suspension of any
Bank's obligations to permit an Election of a LIBOR Loan, to Continue its LIBOR
Loan, or to Convert its Base Rate Loan into a LIBOR Loan shall cease to exist,
such Bank shall provide Borrower with prompt written notice of same (with a copy
to Administrative Agent), and such Bank shall again be obligated to permit an
Election of a LIBOR Loan, to Continue its LIBOR Loan, or to Convert its Base
Rate Loan into a LIBOR Loan in accordance with this Agreement.
SECTION 3.05. Certain Compensation. Borrower shall pay to
Administrative Agent for the account of the applicable Bank, upon the request of
such Bank through Administrative Agent, such amount or amounts as shall be
sufficient (in the reasonable opinion of such Bank) to compensate it for any
loss, cost or expense which such Bank determines is attributable to:
(1) any payment, prepayment, Conversion or Continuation of a LIBOR
Loan made by such Bank on a date other than the last day of an applicable
Interest Period, whether by reason of acceleration or otherwise; or
(2) any failure by Borrower for any reason to Convert or Continue
a LIBOR Loan to be Converted or Continued by such Bank on the date
specified therefor in the relevant notice under Section 2.15; or
(3) any failure by Borrower to borrow (or to qualify for a
borrowing of) a LIBOR Loan which would otherwise be made hereunder on the
date specified in the relevant Election notice under Section 2.15 given or
submitted by Borrower.
Without limiting the foregoing, such compensation shall include an
amount equal to the present value (using as the discount rate an interest rate
equal to the rate determined under (2) below) of the excess, if any, of (1) the
amount of interest which otherwise would have accrued on the principal amount so
paid, prepaid, Converted or Continued (or not Converted, Continued or borrowed)
for the period from the date of such payment, prepayment, Conversion or
Continuation (or failure to Convert, Continue or borrow) to the last day of the
then current applicable Interest Period (or, in the case of a failure to
Convert, Continue or borrow, to the last day of the applicable Interest Period
which would have commenced on the date specified therefor in the relevant
notice) at the applicable rate of interest for the LIBOR Loan provided for
herein, over (2) the amount of interest (as reasonably determined by such Bank)
based upon the interest rate which such Bank would have bid in the London
interbank market for Dollar deposits, for amounts comparable to such principal
amount and maturities comparable to such
28
period. A determination of any Bank as to the amounts payable pursuant to this
Section shall be conclusive absent manifest error.
SECTION 3.06. Capital Adequacy. If any Bank shall have determined that,
after the date hereof, the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or administration thereof by any Governmental Authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or any request or directive regarding capital adequacy (whether or not
having the force of law) of any such Governmental Authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on capital of such Bank (or its Parent) as a consequence of such Bank's
obligations hereunder to a level below that which such Bank (or its Parent)
could have achieved but for such adoption, change, request or directive (taking
into consideration its policies with respect to capital adequacy) by an amount
deemed by such Bank to be material, then from time to time, within fifteen (15)
days after demand by such Bank (with a copy to Administrative Agent), Borrower
shall pay to such Bank such additional amount or amounts as will compensate such
Bank (or its Parent) for such reduction. A certificate of any Bank claiming
compensation under this Section, setting forth in reasonable detail the basis
therefor, shall be conclusive absent manifest error.
SECTION 3.07. Substitution of Banks. If any Bank (an "Affected Bank")
(i) makes demand upon Borrower for (or if Borrower is otherwise required to pay)
Additional Costs pursuant to Section 3.01 or (ii) is unable to make or maintain
a LIBOR Loan as a result of a condition described in Section 3.03 or clause (2)
of Section 3.02, Borrower may, within ninety (90) days of receipt of such demand
or notice (or the occurrence of such other event causing Borrower to be required
to pay Additional Costs or causing said Section 3.03 or clause (2) of Section
3.02 to be applicable), as the case may be, give notice (a "Replacement Notice")
to Administrative Agent (which will promptly forward a copy of such notice to
each Bank) of Borrower's intention either (x) to prepay in full the Affected
Bank's Notes and to terminate the Affected Bank's entire Loan Commitment or (y)
to replace the Affected Bank with another financial institution (the
"Replacement Bank") designated in such Replacement Notice.
In the event Borrower opts to give the notice provided for in clause
(x) above, and if the Affected Bank shall not agree within thirty (30) days of
its receipt thereof to waive the payment of the Additional Costs in question or
the effect of the circumstances described in Section 3.03 or clause (2) of
Section 3.02, then, so long as no Default or Event of Default shall exist,
Borrower may (notwithstanding the provisions of clause (2) of Section 2.11(a))
terminate the Affected Bank's entire Loan Commitment, provided that in
connection therewith it pays to the Affected Bank all outstanding principal and
accrued and unpaid interest under the Affected Bank's Notes, together with all
other amounts, if any, due from Borrower to the Affected Bank, including all
amounts properly demanded and unreimbursed under Sections 3.01 and 3.05.
In the event Borrower opts to give the notice provided for in clause
(y) above, and if (i) Administrative Agent shall, within thirty (30) days of its
receipt of the Replacement Notice, notify Borrower and each Bank in writing that
the Replacement Bank is reasonably satisfactory to Administrative Agent and (ii)
the Affected Bank shall not, prior to the end of such thirty (30)-day period,
agree to waive the payment of the Additional Costs in question or the effect of
the
29
circumstances described in Section 3.03 or clause (2) of Section 3.02, then the
Affected Bank shall, so long as no Default or Event of Default shall exist,
assign its Notes and all of its rights and obligations under this Agreement to
the Replacement Bank, and the Replacement Bank shall assume all of the Affected
Bank's rights and obligations, pursuant to an agreement, substantially in the
form of an Assignment and Assumption Agreement, executed by the Affected Bank
and the Replacement Bank. In connection with such assignment and assumption, the
Replacement Bank shall pay to the Affected Bank an amount equal to the
outstanding principal amount under the Affected Bank's Notes plus all interest
accrued thereon, plus all other amounts, if any (other than the Additional Costs
in question), then due and payable to the Affected Bank; provided, however, that
prior to or simultaneously with any such assignment and assumption, Borrower
shall have paid to such Affected Bank all amounts properly demanded and
unreimbursed under Sections 3.01 and 3.05. Upon the effective date of such
assignment and assumption, the Replacement Bank shall become a Bank Party to
this Agreement and shall have all the rights and obligations of a Bank as set
forth in such Assignment and Assumption Agreement, and the Affected Bank shall
be released from its obligations hereunder, and no further consent or action by
any party shall be required. Upon the consummation of any assignment pursuant to
this Section, substitute Notes shall be issued to the Replacement Bank by
Borrower, in exchange for the return of the Affected Bank's Notes. The
obligations evidenced by such substitute Notes shall constitute "Obligations"
for all purposes of this Agreement and the other Loan Documents. If the
Replacement Bank is not incorporated under the Laws of the United States of
America or a state thereof, it shall, prior to the first date on which interest
or fees are payable hereunder for its account, deliver to Borrower and
Administrative Agent certification as to exemption from deduction or withholding
of any United States federal income taxes in accordance with Section 10.13.
Borrower, Administrative Agent and the Banks shall execute such
modifications to the Loan Documents as shall be reasonably required in
connection with and to effectuate the foregoing.
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.01. Conditions Precedent to the Initial Advance. The
obligations of the Banks hereunder and the obligation of each Bank to make
Initial Advance are subject to the condition precedent that Administrative Agent
shall have received on or before the Closing Date each of the following
documents, and each of the following requirements shall have been fulfilled:
(1) Fees and Expenses. The payment of (A) all fees and expenses
incurred by Administrative Agent (including, without limitation, the
reasonable fees and expenses of legal counsel) and (B) the fees specified
in the Supplemental Fee Letter to be paid on or before the Closing Date;
(2) Note. The Note for UBS, duly executed by Borrower;
30
(3) Financials of Borrower. Audited TRG Consolidated Financial
Statements as of and for the year ended December 31, 1997 and unaudited TRG
Consolidated Financial Statements as of and for the quarter ended June 30,
1998, each acceptable to the Banks;
(4) Evidence of Formation of Borrower. Certified (as of the
Closing Date) copies of Borrower's certificate and agreement of limited
partnership, with all amendments thereto, and a certificate of the
Secretary of State of the jurisdiction of formation as to its good standing
therein;
(5) Evidence of All Partnership Action. Certified (as of the
Closing Date) copies of all documents evidencing partnership action taken
by Borrower authorizing the execution, delivery and performance of the Loan
Documents and each other document to be delivered by or on behalf of
Borrower pursuant to this Agreement;
(6) Incumbency and Signature Certificate of Borrower. A
certificate (dated as of the Closing Date) of the Secretary of the
Partnership Committee of Borrower certifying the names and true signatures
of each individual authorized to sign on behalf of Borrower;
(7) Solvency Certificate. A Solvency Certificate, duly executed,
from Borrower;
(8) Opinion of Counsel for Borrower. A favorable opinion, dated
the Closing Date, of Miro Weiner & Kramer, counsel for Borrower, as to such
matters as Administrative Agent may reasonably request;
(9) Authorization Letter. The Authorization Letter, duly
executed by Borrower;
(10) Certificate. The following statements shall be true and
Administrative Agent shall have received a certificate dated the Closing
Date signed by a duly authorized signatory of Borrower stating, to the best
of the certifying party's knowledge, the following:
(a) All representations and warranties contained in this
Agreement and in each of the other Loan Documents are true and
correct on and as of the Closing Date as though made on and as of
such date, and
(b) No Default or Event of Default has occurred and is
continuing, or could result from the transactions contemplated by
this Agreement and the other Loan Documents;
(11) Supplemental Fee Letter. The Supplemental Fee Letter, duly
executed by Borrower;
(12) Separation Agreement. A copy of the Separation Agreement,
certified by Borrower to be true and complete;
31
(13) Evidence of Bond Defeasance. Evidence that at least 65% of
the indebtedness represented by the Bonds has been defeased and/or repaid;
(14) Evidence regarding Specified Credit Facilities. Evidence that
the Specified Credit Facilities have been repaid in full and terminated;
(15) Evidence regarding Schedule A and B Assets. Evidence that the
Schedule A Assets and the Schedule B Assets are not subject to any Lien to
secure all or any portion of Secured Indebtedness (other than the Woodfield
Mortgage Loan, the Stoneridge Mortgage Loan, the Columbus UDAG Loan and the
indebtedness described in the chart in the definition of "Unencumbered
Wholly-Owned Assets" in Section 1.01);
(16) Request for Advance. A request for an advance in accordance
with Section 2.04;
(17) Related Bridge Loan Fully Disbursed. The Related Bridge Loan
shall have been fully disbursed; and
(18) Additional Documentation. Such other approvals, opinions or
documents as Administrative Agent or any Bank may reasonably request.
SECTION 4.02. Conditions Precedent to Advances After the Initial
Advance. The obligation of each Bank to make advances of the Loans subsequent to
the Initial Advance shall be subject to satisfaction of the following conditions
precedent:
(1) All conditions of Section 4.01 shall have been and remain
satisfied as of the date of the advance;
(2) No Default or Event of Default shall have occurred and be
continuing as of the date of the advance;
(3) Administrative Agent shall have received a request for an
advance in accordance with Section 2.04; and
(4) In the case of the first such subsequent advance following the
consummation of the Unit Redemption Transaction, Administrative Agent shall
have received and approved (such approval not to be unreasonably withheld)
an amendment and restatement of Borrower's agreement of limited partnership
(it being understood that the form of amendment and restatement attached to
that certain Interim Agreement dated as of August 17, 1998 among TCI and
others is deemed approved).
SECTION 4.03. Deemed Representations. Each request by Borrower for, and
acceptance by Borrower of, an advance of proceeds of the Loans shall constitute
a representation and warranty by Borrower that, as of both the date of such
request and the date of the advance (1) no Default or Event of Default has
occurred and is continuing and (2) if any representation or warranty contained
in this Agreement or the other Loan Documents is untrue or incorrect, the
32
condition giving rise to such untruthfulness or incorrectness is not likely to
result in a Material Adverse Change.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Administrative Agent and each Bank as
follows:
SECTION 5.01. Due Organization. Borrower is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, has the partnership power and authority to own its assets and to
transact the business in which it is now engaged, and, if applicable, is duly
qualified as a foreign partnership and in good standing under the laws of each
other jurisdiction in which such qualification is required.
SECTION 5.02. Power and Authority; No Conflicts; Compliance With Laws.
The execution, delivery and performance of the obligations required to be
performed by Borrower of the Loan Documents does not and will not (1) require
the consent or approval of its partners or such consent or approval has been
obtained, (2) contravene its partnership agreement, (3) violate any provision
of, or require any filing, registration, consent or approval under, any Law
(including, without limitation, Regulation U), order, writ, judgment,
injunction, decree, determination or award presently in effect having
applicability to it, (4) result in a breach of or constitute a default under or
require any consent under any indenture or loan or credit agreement or any other
agreement, lease or instrument to which it may be a party or by which it or its
properties may be bound or affected except for consents which have been
obtained, (5) result in, or require, the creation or imposition of any Lien,
upon or with respect to any of its properties now owned or hereafter acquired or
(6) cause it to be in default under any such Law, order, writ, judgment,
injunction, decree, determination or award or any such indenture, agreement,
lease or instrument; to the best of its knowledge, Borrower is in compliance
with all Laws applicable to it where the failure to be in compliance would cause
a Material Adverse Change to occur.
SECTION 5.03. Legally Enforceable Agreements. Each Loan Document is a
legal, valid and binding obligation of Borrower, enforceable against Borrower in
accordance with its terms, except to the extent that such enforcement may be
limited by applicable bankruptcy, insolvency and other similar laws affecting
creditors' rights generally.
SECTION 5.04. Litigation. There are no actions, suits or proceedings
pending or, to its knowledge, threatened against Borrower or any of its
Affiliates before any court or arbitrator or any Governmental Authority except
actions, suits or proceedings which have been disclosed to Administrative Agent
and the Banks in writing and which are fully covered by insurance or would, if
adversely determined, not substantially impair the ability of Borrower to pay
when due any amounts which may become payable under the Notes or to otherwise
pay and perform its obligations in connection with the Loans.
33
SECTION 5.05. Good Title to Properties. Borrower and each of its
Affiliates have good, marketable and legal title to all of the properties and
assets each of them purports to own (including, without limitation, those
reflected in the June 30, 1998 financial statements referred to in Section 5.13)
and, in the case of all of Borrower's shopping center properties, only with
exceptions which do not materially detract from the value of such property or
assets or the use thereof in Borrower's and such Affiliate's business, and
except to the extent that any such properties and assets have been encumbered or
disposed of since the date of such financial statements without violating any of
the covenants contained in Article VII or elsewhere in this Agreement. Borrower
and its Affiliates enjoy peaceful and undisturbed possession of all leased
property necessary in any material respect in the conduct of their respective
businesses. All such leases are valid and subsisting and are in full force and
effect.
SECTION 5.06. Taxes. Borrower has filed all tax returns (federal, state
and local) required to be filed and has paid all taxes, assessments and
governmental charges and levies due and payable without the imposition of a
penalty, including interest and penalties, except to the extent they are the
subject of a Good Faith Contest.
SECTION 5.07. ERISA. Borrower is in compliance in all material respects
with all applicable provisions of ERISA. Neither a Reportable Event nor a
Prohibited Transaction has occurred with respect to any Plan; no notice of
intent to terminate a Plan has been filed nor has any Plan been terminated
within the past five (5) years; no circumstance exists which constitutes grounds
under Section 4042 of ERISA entitling the PBGC to institute proceedings to
terminate, or appoint a trustee to administer, a Plan, nor has the PBGC
instituted any such proceedings; Borrower and the ERISA Affiliates thereof have
not completely or partially withdrawn under Sections 4201 or 4204 of ERISA from
a Multiemployer Plan; Borrower and the ERISA Affiliates thereof have met the
minimum funding requirements of each under ERISA with respect to the plans of
each and there are no unfunded vested liabilities with respect to any plan
established or maintained by each; and Borrower and the ERISA Affiliates thereof
have not incurred any liability to the PBGC under ERISA.
SECTION 5.08. No Default on Outstanding Judgments or Orders. Borrower has
satisfied all judgments which are not being appealed and is not in default with
respect to any judgment, order, writ, injunction, decree, rule or regulation of
any court, arbitrator or federal, state, municipal or other Governmental
Authority, commission, board, bureau, agency or instrumentality, domestic or
foreign.
SECTION 5.09. No Defaults on Other Agreements. Except as disclosed to
the Bank Parties in writing, including anything disclosed on financial
statements, Borrower, to the best of its knowledge, is not a party to any
indenture, loan or credit agreement or any lease or other agreement or
instrument or subject to any partnership, trust or other restriction which is
likely to result in a Material Adverse Change. To the best of its knowledge,
Borrower is not in default in any respect in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in any
agreement or instrument which is likely to result in a Material Adverse Change.
34
SECTION 5.10. Government Regulation. Borrower is not subject to
regulation under the Investment Company Act of 1940, the Interstate Commerce
Act, the Federal Powers Act or any statute or regulation limiting any such
Person's ability to incur indebtedness for money borrowed as contemplated
hereby.
SECTION 5.11. Environmental Protection. To the best of Borrower's
knowledge, none of Borrower's or its Affiliates' properties contains any
Hazardous Materials that, under any Environmental Law currently in effect, (1)
would impose liability on Borrower that is likely to result in a Material
Adverse Change or (2) is likely to result in the imposition of a Lien on any
assets of Borrower or its Affiliates, in each case if not properly handled in
accordance with applicable Law. To the best of Borrower's knowledge, neither it
nor any of its Affiliates is in violation of, or subject to any existing,
pending or threatened investigation or proceeding by any Governmental Authority
under, any Environmental Law.
SECTION 5.12. Solvency. Borrower is, and upon consummation of the
transactions contemplated by this Agreement, the other Loan Documents and any
other documents, instruments or agreements relating thereto, will be, Solvent.
SECTION 5.13. Financial Statements. The TRG Consolidated Financial
Statements and TCI Financial Statements most recently delivered to the Banks
pursuant to the terms of this Agreement are in all material respects complete
and correct and fairly present the financial condition of the subjects thereof
as of the dates of and for the periods covered by such statements, all in
accordance with GAAP, and there has been no Material Adverse Change since the
date of such most recently delivered TRG Consolidated Financial Statements or
TCI Financial Statements, as the case may be.
SECTION 5.14. Valid Existence of Affiliates. As of the Closing Date,
the only material Affiliates of Borrower which own or lease operating shopping
centers or shopping centers under construction are listed on EXHIBIT D. Each
such Affiliate is a partnership, limited liability company or joint venture duly
organized and existing in good standing under the laws of the jurisdiction of
its formation. As to each such Affiliate, its correct name, the jurisdiction of
its formation and Borrower's percentage of beneficial interest therein are set
forth on said EXHIBIT D. Borrower and each of such Affiliates have the power to
own their respective properties and to carry on their respective businesses now
being conducted. Each of Borrower and such Affiliates is duly qualified as a
foreign partnership, company or venture to do business and is in good standing
in every jurisdiction in which the nature of the respective businesses conducted
by it or its respective properties, owned or held under lease, make such
qualification necessary.
SECTION 5.15. Insurance. Borrower and each of its Affiliates has in
force paid insurance with financially sound and reputable insurance companies or
associations in such amounts and covering such risks as are usually carried by
companies engaged in the same or a similar business and similarly situated.
SECTION 5.16. Schedule A and B Assets. None of the Schedule A Assets or
Schedule B Assets is subject to (1) any Lien to secure all or any portion of
Secured Indebtedness
35
(other than the Woodfield Mortgage Loan, the Stoneridge Mortgage Loan, the
Columbus UDAG Loan and the indebtedness described in the chart in the definition
of "Unencumbered Wholly-Owned Assets" in Section 1.01) or (2) any pledge or
agreement not to encumber.
SECTION 5.17. Accuracy of Information; Full Disclosure. To the best of
Borrower's knowledge, neither this Agreement nor any documents, financial
statements, reports, notices, schedules, certificates, statements or other
writings furnished by or on behalf of Borrower to Administrative Agent or any
Bank in connection with the negotiation of this Agreement or the consummation of
the transactions contemplated hereby, or required herein to be furnished by or
on behalf of Borrower, contains any untrue or misleading statement of a material
fact or omits a material fact necessary to make the statements herein or therein
not misleading. To the best of Borrower's knowledge, there is no fact which
Borrower has not disclosed to Administrative Agent and the Banks in writing
which materially affects adversely nor, so far as Borrower can now foresee, will
materially affect adversely the business, prospects, profits or financial
condition of Borrower or the ability of Borrower to perform this Agreement and
the other Loan Documents.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any of the Notes shall remain unpaid or the Loan Commitments
remain in effect, or any other amount is owing by Borrower to any Bank hereunder
or under any other Loan Document, Borrower shall:
SECTION 6.01. Maintenance of Existence. Preserve and maintain its legal
existence and, if applicable, good standing in the jurisdiction of organization
and, if applicable, qualify and remain qualified as a foreign partnership in
each jurisdiction in which such qualification is required, except to the extent
that failure to so qualify is not likely to result in a Material Adverse Change.
SECTION 6.02. Maintenance of Records. Keep adequate records and books
of account, in which complete entries will be made in accordance with GAAP,
reflecting all of its financial transactions.
SECTION 6.03. Maintenance of Insurance. At all times, maintain and keep
in force, and cause each of its Affiliates to maintain and keep in force,
insurance with financially sound and reputable insurance companies or
associations in such amounts and covering such risks as are usually carried by
companies engaged in the same or a similar business and similarly situated,
which insurance may provide for reasonable deductibility from coverage thereof.
SECTION 6.04. Compliance with Laws; Payment of Taxes. Comply in all
respects with all Laws applicable to it or to any of its properties or any part
thereof, such compliance to include, without limitation, paying before the same
become delinquent all taxes, assessments and governmental charges imposed upon
it or upon its property, except to the extent they are the subject of a Good
Faith Contest.
36
SECTION 6.05. Right of Inspection. At any reasonable time and from time
to time upon reasonable notice, permit Administrative Agent or any Bank or any
agent or representative thereof (provided that a representative of any Bank
must, at Borrower's request, be accompanied by a representative of Borrower), to
examine and make copies and abstracts from the records and books of account of,
and visit the properties of, Borrower and to discuss the affairs, finances and
accounts of Borrower with the independent accountants of Borrower.
SECTION 6.06. Compliance With Environmental Laws. Comply in all
material respects with all applicable Environmental Laws and immediately pay or
cause to be paid all costs and expenses incurred in connection with such
compliance, except to the extent there is a Good Faith Contest.
SECTION 6.07. Payment of Costs. Pay all costs and expenses required for
the satisfaction of the conditions of this Agreement.
SECTION 6.08. Maintenance of Properties. Do all things reasonably
necessary to maintain, preserve, protect and keep its and its Affiliates'
properties in good repair, working order and condition.
SECTION 6.09. Reporting and Miscellaneous Document Requirements.
Furnish directly to each of the Banks:
(1) Annual Financial Statements. As soon as available and in any
event within ninety (90) days after the end of each Fiscal Year, the TRG
Consolidated Financial Statements and, following the consummation of the
Unit Redemption Transaction, the TCI Financial Statements, in each case as
of the end of and for such Fiscal Year, in reasonable detail and stating
in comparative form the respective figures for the corresponding date and
period in the prior Fiscal Year and audited by Borrower's Accountants;
(2) Quarterly Financial Statements. As soon as available and in
any event within forty-five (45) days after the end of each calendar
quarter (other than the last quarter of the Fiscal Year), the unaudited
TRG Consolidated Financial Statements and, following the consummation of
the Unit Redemption Transaction, the TCI Financial Statements, in each
case as of the end of and for such calendar quarter, in reasonable detail
and stating in comparative form the respective figures for the
corresponding date and period in the prior Fiscal Year;
(3) Certificate of No Default and Financial Compliance. Within
forty five (45) days after the end of each of the first three quarters of
each Fiscal Year and within ninety (90) days after the end of each Fiscal
Year, a certificate of Borrower's chief financial officer or Treasurer (a)
stating that, to the best of his or her knowledge, no Default or Event of
Default has occurred and is continuing, or if a Default or Event of
Default has occurred and is continuing, specifying the nature thereof and
the action which is proposed to be taken with respect thereto, (b) stating
that the covenants contained in
37
Sections 7.02, 7.03, 7.04 and 7.06 and in Article VIII have been complied
with (or specifying those that have not been complied with) and including
computations demonstrating such compliance (or non-compliance) and (c)
setting forth the details of all items comprising Total Outstanding
Indebtedness (including amount, maturity, interest rate and amortization
requirements), and Unsecured Indebtedness, each as of the end of such
quarter, and Combined EBITDA, Unencumbered Combined EBITDA, Interest
Expense, Unsecured Interest Expense and Fixed Charges, each for the twelve
(12)-month period ending with such quarter;
(4) Certificate of Borrower's Accountants. Simultaneously with the
delivery of the annual financial statements required by paragraph (1) of
this Section, a statement of Borrower's Accountants who audited such
financial statements comparing the computations set forth in the financial
compliance certificate required by paragraph (3)(b) of this Section to the
audited financial statements required by paragraph (1) of this Section
(where such information appears in such financial statements);
(5) Notice of Litigation. Promptly after the commencement and
knowledge thereof, notice of all actions, suits, and proceedings before
any court or arbitrator, affecting Borrower which, if determined adversely
to Borrower is likely to result in a Material Adverse Change;
(6) Notices of Defaults and Events of Default. As soon as possible
and in any event within ten (10) days after Borrower becomes aware of the
occurrence of a material Default or any Event of Default a written notice
setting forth the details of such Default or Event of Default and the
action which is proposed to be taken with respect thereto;
(7) Dispositions or Acquisitions of Assets. Within thirty (30)
days after the occurrence thereof, written notice of any Disposition or
acquisition of assets (other than acquisitions or Dispositions of
investments such as certificates of deposit, Treasury securities and money
market deposits in the ordinary course of Borrower's cash management) in
excess of $25,000,000, together with, in the case of any acquisition of
such an asset, (i) copies of the agreements governing the acquisition,
(ii) historical balance sheets (to the extent available) and statements of
income and cash flows with respect to the property acquired for at least
the preceding three (3) years (to the extent available) and Borrower's
revenue and expense projections for the property acquired for at least the
next five (5) years (all of the foregoing to be in form and detail
satisfactory to Administrative Agent), (iii) a certificate, of the sort
required by paragraph (3)(b) of this Section, containing covenant
compliance calculations that include the pro-forma adjustments set forth
in Section 8.03, which calculations shall demonstrate Borrower's
compliance, on a pro-forma basis, as of the end of the most recently ended
calendar quarter for which financial results are required hereunder to
have been reported by Borrower, with all covenants enumerated in said
paragraph (3)(b) and (iv) such other information relating to the
acquisition as Administrative Agent may reasonably request;
(8) Material Adverse Change. As soon as is practicable and in any
event within five (5) days after knowledge of the occurrence of any event
or circumstance
38
which is likely to result in or has resulted in a Material Adverse Change,
written notice thereof;
(9) Bankruptcy of Tenants. Promptly after becoming aware of the
same, written notice of the bankruptcy, insolvency or cessation of
operations of any tenant in any property of Borrower or in which Borrower
has an interest to which 5% or more of minimum rent payable to Borrower
directly or through its Consolidated Businesses or UJVs is attributable;
(10) Offices. Thirty (30) days' prior written notice of any change
in the chief executive office or principal place of business of Borrower;
(11) Environmental and Other Notices. As soon as possible and in
any event within five (5) days after receipt, copies of all Environmental
Notices received by Borrower which are not received in the ordinary course
of business and which relate to a situation which is likely to result in a
Material Adverse Change;
(12) Insurance Coverage. Promptly, such information concerning
Borrower's insurance coverage as Administrative Agent may reasonably
request;
(13) Separation Agreement. Promptly, any changes in the Separation
Agreement or the Unit Redemption Transaction; and
(14) General Information. Promptly, such other information
respecting the condition or operations, financial or otherwise, of
Borrower or any properties of Borrower as Administrative Agent may from
time to time reasonably request.
ARTICLE VII
NEGATIVE COVENANTS
So long as any of the Notes shall remain unpaid, or the Loan
Commitments remain in effect, or any other amount is owing by Borrower to
Administrative Agent or any Bank hereunder or under any other Loan Document,
Borrower shall not do any or all of the following:
SECTION 7.01. Mergers Etc. Merge or consolidate with any Person (except
where Borrower or a Person wholly-owned by Borrower is the surviving entity), or
sell, assign, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) (or enter into any agreement to do any of the
foregoing).
SECTION 7.02. Investments. Make any loan or advance to any Person or
purchase or otherwise acquire any capital stock, assets, obligations or other
securities of, make any capital contribution to, or otherwise invest in, or
acquire any interest in, any Person (any such transaction, an "Investment") if
(1) the Investment is in connection with something other
39
than a retail shopping center and the amount of any single such Investment (or
the aggregate amount of any single such Investment together with all related
Investments), would exceed 20% of Net Worth, (2) except to the extent permitted
by clause (3) below, such Investment constitutes the acquisition of a minority
interest in a Person (a "Minority Interest") and the amount of such Investment,
together with the value of all other Minority Interests acquired after the
Closing Date contributing to Capitalization Value, would exceed 10% of Net Worth
or (3) such Investment constitutes the acquisition of a Minority Interest in a
regional shopping center or portfolio of regional shopping centers and the
amount of such Investment, together with the value of all other such Minority
Interests, would exceed 20% of Net Worth. A 50% beneficial interest in a Person,
in connection with which the holder thereof exercises joint control over such
Person with the holder(s) of the other 50% beneficial interest, shall not
constitute a "Minority Interest" for purposes of this Section.
SECTION 7.03. Sale of Assets. Effect a Disposition of any of its now
owned or hereafter acquired assets, including assets in which Borrower owns a
beneficial interest through its ownership of interests in joint ventures,
aggregating more than 20% of Capitalization Value.
SECTION 7.04. Interest Rate Hedging. At any time following the date
ninety (90) days after the date hereof, permit or suffer more than 25% of Total
Outstanding Indebtedness not to be "hedged"; for purposes of this Section,
"hedged" shall mean bearing interest at an effective fixed rate, either pursuant
to the debt instrument itself or through the operation of a "cap", "collar",
"swap" or comparable interest rate protection contract, such debt instrument, or
instrument creating the "cap", "collar", "swap" or comparable interest rate
protection contract, as the case may be, having an original term of at least
twelve (12) months.
SECTION 7.05. Partnership Committee of Borrower. At any time until the
Unit Redemption Transaction has been consummated, permit or suffer the failure
or inability of any one or more of (1) TG Partners Limited Partnership and/or
Taub-Co Management, Inc., (2) the General Motors Hourly-Rate Employees Pension
Trust and/or the General Motors Salaried Employees Pension Trust, directly or
indirectly (or a single "GMPTS Transferee," as such quoted term is defined in
Borrower's Amended and Restated Agreement of Limited Partnership) and (3) TCI,
to designate a majority of Borrower's partnership committee; or, at any time
thereafter, permit or suffer the failure or inability of TCI to be the managing
general partner of Borrower.
SECTION 7.06. Disposition or Encumbrance of Certain Assets.
Notwithstanding anything to the contrary contained herein, at any time, effect a
Disposition of, mortgage, hypothecate or otherwise encumber to secure a Debt (it
being understood that, for purposes of this Section, an asset shall be deemed
"encumbered" if it is the subject of a pledge or agreement not to encumber), any
of the Schedule A Assets or the Schedule B Assets, or any portion of its
interest in any of such assets, in any such case, without the prior written
approval of the Required Banks, which approval may be granted or denied in the
sole and absolute discretion of the Required Banks, provided, however, that (1)
such consent shall not be required for the transfer of the Schedule B Assets to
GMPT Borrower in connection with the consummation of the Unit Redemption
Transaction, including the simultaneous assumption by GMPT Borrower of
40
all of Borrower's obligations in respect of the Related Bridge Term Loan, all as
contemplated by the Term Credit Agreement governing the Related Bridge Term Loan
and (2) such consent shall not be required for the encumbrance of one or more of
the Schedule A Assets or Schedule B Assets to secure, in any such case, a
mortgage loan provided that such loan is non-recourse to Borrower and generates
proceeds of not less than 60% of the value of the applicable Schedule A Asset(s)
or Schedule B Asset(s) (as such values are reflected in the June 30, 1997
Taubman Realty Group Current Value Analysis previously delivered to
Administrative Agent) and such proceeds are applied in accordance with Section
2.17 of the Credit Agreement governing the Related Bridge Loan and Section 2.18
of the Term Credit Agreement governing the Related Bridge Term Loan. The Banks
acknowledge that the existence of Liens securing the Woodfield Mortgage Loan and
the indebtedness described in the chart in the definition of "Unencumbered
Wholly-Owned Assets" in Section 1.01 shall not violate this Section.
SECTION 7.07. Amendments to Separation Agreement. At any time, amend,
modify or supplement the Separation Agreement in any material respect without
the prior written consent of the Required Banks, which shall not be unreasonably
withheld or delayed.
SECTION 7.08. Certain Restrictions on Activities of TCI. At any time,
suffer or permit TCI to incur any Debt in its own name or to own any material
assets other than its interests in Borrower and incidental assets or engage in
any business other than the ownership of such interests.
ARTICLE VIII
FINANCIAL COVENANTS AND ADJUSTMENTS
SECTION 8.01. Covenants Prior to Certain Events. Prior to such time as
(a) the Related Bridge Loan has been repaid in full and the loan commitments of
the lenders thereof cease to be in effect, (b) (x) the Related Bridge Term Loan
has been repaid in full and the loan commitments of the lenders thereof cease to
be in effect or (y) the Related Bridge Term Loan has been assumed by GMPT
Borrower, as contemplated by the Term Credit Agreement governing the Related
Bridge Term Loan, (c) the Loans have become secured, as contemplated by Section
2.17 and (d) the Loan Commitments have terminated, the Notes have been repaid in
full and any other amounts owing by Borrower to Administrative Agent or any Bank
under this Agreement or under any other Loan Document have been repaid in full,
Borrower shall not permit or suffer:
(1) Net Worth. At any time, Net Worth to be less than $1,000,000,000; or
(2) Leverage Ratio. At any time, Leverage Ratio to exceed 60%; or
(3) Relationship of Combined EBITDA to Fixed Charges. As of the end of any
calendar quarter, the ratio of (i) Combined EBITDA to (ii) Fixed Charges, each
for the twelve (12)-month period then ended and taken as a whole, to be less
than 1.50 to 1.00; or
41
(4) Relationship of Combined EBITDA to Interest Expense. As of the end of
any calendar quarter, the ratio of (i) Combined EBITDA to (ii) Interest Expense,
each for the twelve (12)-month period then ended and taken as a whole, to be
less than 1.85 to 1.00; or
(5) Relationship of Combined EBITDA to Total Outstanding Indebtedness. As
of the end of any calendar quarter, the ratio (expressed as a percentage) of (i)
Combined EBITDA for the twelve (12)-month period then ended and taken as a whole
to (ii) Total Outstanding Indebtedness as of the end of such calendar quarter,
to be less than 13.5%; or
(6) Payout Ratio. Any Restricted Payment to be made during any of its
fiscal quarters, which, when added to all Restricted Payments made during the
three (3) immediately preceding fiscal quarters, exceeds 90% of Distributable
Cash Flow; provided, however, that Borrower shall be permitted, provided there
exists no Event of Default, to make Restricted Payments in excess of 90% of
Distributable Cash Flow as may be necessary under Section 857(a) of the Code to
maintain TCI's tax status as a real estate investment trust. For purposes of
this Article, "Restricted Payment" means any distribution or other payment made
by Borrower to its partners, other than distributions pursuant to Section 5.3 of
Borrower's agreement of limited partnership; or
(7) Unsecured Debt Yield. As of the end of any calendar quarter, Unsecured
Debt Yield for such calendar quarter to be less than 13%; or
(8) Relationship of Unencumbered Combined EBITDA to Interest Expense on
Unsecured Indebtedness. As of the end of any calendar quarter, the ratio of (i)
Unencumbered Combined EBITDA to (ii) that portion of Interest Expense
attributable to Unsecured Indebtedness, each for the prior twelve (12)-month
period then ended and taken as a whole, to be less than 1.50 to 1.00.
SECTION 8.02. Covenants Subsequent to Certain Events. Subsequent to
such time as (a) the Related Bridge Loan has been repaid in full and the loan
commitments of the lenders thereof cease to be in effect, (b) (x) the Related
Bridge Term Loan has been repaid in full and the loan commitments of the lenders
thereof cease to be in effect or (y) the Related Bridge Term Loan has been
assumed by GMPT Borrower, as contemplated by the Term Credit Agreement governing
the Related Bridge Term Loan and (c) the Loans have become secured, as
contemplated by Section 2.17; and so long as any of the Notes shall remain
unpaid, or the Loan Commitments shall remain in effect, or any other amount is
owing by Borrower to Administrative Agent or any Bank under this Agreement or
under any other Loan Document, Borrower shall not permit or suffer:
(1) Net Worth. At any time, Net Worth to be less than $1,000,000,000; or
(2) Leverage Ratio. At any time, Leverage Ratio to exceed 70%; or
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(3) Relationship of Combined EBITDA to Fixed Charges. As of the end of any
calendar quarter, the ratio of (i) Combined EBITDA to (ii) Fixed Charges, each
for the twelve (12)-month period then ended and taken as a whole, to be less
than 1.40 to 1.00; or
(4) Relationship of Combined EBITDA to Total Outstanding Indebtedness. As
of the end of any calendar quarter, the ratio (expressed as a percentage) of (i)
Combined EBITDA for the twelve (12)-month period then ended and taken as a whole
to (ii) Total Outstanding Indebtedness as of the end of such calendar quarter,
to be less than 11.5%; or
(5) Payout Ratio. Any Restricted Payment to be made during any of its
fiscal quarters, which, when added to all Restricted Payments made during the
three (3) immediately preceding fiscal quarters, exceeds 95% of Distributable
Cash Flow; provided, however, that Borrower shall be permitted, provided there
exists no Event of Default, to make Restricted Payments in excess of 95% of
Distributable Cash Flow as may be necessary under Section 857(a) of the Code to
maintain TCI's tax status as a real estate investment trust; or
(6) Collateral Property Debt Yield. As of the end of any calendar quarter,
Collateral Property Debt Yield for such calendar quarter to be less than 13%; or
(7) Relationship of Collateral Property EBITDA to Interest Expense on
Loans. As of the end of any calendar quarter, the ratio of (i) Collateral
Property EBITDA to (ii) that portion of Interest Expense attributable to the
Loans, each for the prior twelve (12)-month period then ended and taken as a
whole, to be less than 1.75 to 1.00.
SECTION 8.03. Certain Pro-Forma Adjustments. For purposes of the
calculation of the financial covenants set forth in Sections 8.01 and 8.02, the
following adjustments shall be made in the case of each property acquired, or
each "property put into service", or each property disposed of, by Borrower
during the applicable test period:
(1) In the case of each property acquired or put into service, the
contribution of said property to Capitalization Value shall be the lesser
of (a) such property's contribution to Combined EBITDA, annualized based
on Borrower's period of ownership or operation, divided by 8.00% or (b)
the acquisition cost or cost of the property. In the case of each property
disposed of by Borrower during the applicable test period, such property
shall be deemed to have made no contribution to Capitalization Value for
the applicable twelve (12)-month period.
(2) In the case of each property acquired or put into service, the
contribution of said property to Combined EBITDA shall be an annualized
amount based upon the period of Borrower's ownership or operation. In the
case of each property disposed of by Borrower during the applicable test
period, such property shall be deemed to have made no contribution to
Combined EBITDA for the applicable twelve (12)-month period.
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(3) In the case of each property acquired or put into service, the
contribution of said property to Interest Expense for the applicable
twelve (12)-month period shall be equal to actual interest expense with
respect to the Debt incurred or assumed in connection with the
acquisition, from the date of the acquisition or the date the asset is put
into service until the end of such twelve (12)-month period, annualized.
In the case of each property disposed of during the applicable test
period, such property shall be deemed to have made no contribution to
Interest Expense for such period.
In addition, if any Debt of Borrower is refinanced during an applicable test
period, the calculation of Interest Expense shall be adjusted as follows. The
contribution of the Debt that was refinanced to Interest Expense for the
applicable twelve (12)-month period shall be equal to actual interest expense on
the refinanced Debt from the date of the refinancing to the end of such twelve
(12)-month period, annualized.
As used in this Section 8.03, the term "property put into service" means any
property that has been opened to the public for business and which has generated
revenues for a period of at least thirty (30) days.
ARTICLE IX
EVENTS OF DEFAULT
SECTION 9.01.Events of Default. Any of the following events shall be an
"Event of Default":
(1) If Borrower shall: fail to pay the principal of any Notes as
and when due; or fail to pay interest accruing on any Notes as and when
due and such failure to pay shall continue unremedied for five (5) days
after the due date of such amount; or fail to pay any fee or interest or
any other amount due under this Agreement or any other Loan Document or
the Supplemental Fee Letter as and when due and such failure to pay shall
continue unremedied for two (2) days after notice by Administrative Agent
of such failure to pay; or
(2) If any representation or warranty made by Borrower in this
Agreement or in any other Loan Document or which is contained in any
certificate, document, opinion, financial or other statement furnished at
any time under or in connection with a Loan Document shall prove to have
been incorrect in any material respect on or as of the date made; or
(3) If Borrower shall fail (a) to perform or observe any term,
covenant or agreement contained in Section 2.17, Article VII or Article
VIII or (b) to perform or observe any term, covenant or agreement
contained in Article VI or otherwise contained in this Agreement (other
than obligations specifically referred to elsewhere in this Section) or
any Loan Document, or in the Supplemental Fee Letter or any other document
executed by Borrower and delivered to Administrative Agent and/or the
Banks in connection with the transactions contemplated hereby and such
failure shall remain unremedied for thirty (30) consecutive calendar days
after notice by Administrative
44
Agent to Borrower thereof (or such shorter cure period as may be expressly
prescribed in the applicable Loan Document); provided, however, that if
any such default under clause (b) above cannot by its nature be cured
within such thirty (30) day, or shorter, as the case may be, grace period
and so long as Borrower shall have commenced cure within such thirty (30)
day, or shorter, as the case may be, grace period and shall, at all times
thereafter, diligently prosecute the same to completion, Borrower shall
have an additional period, not to exceed sixty (60) days, to cure such
default; in no event, however, is the foregoing intended to effect an
extension of the Maturity Date; or
(4) If either Borrower or TCI shall fail (a) to pay any Debt
(other than the payment obligations described in paragraph (1) of this
Section) in an amount equal to or greater than $10,000,000 when due
(whether by scheduled maturity, required prepayment, acceleration, demand,
or otherwise) or (b) to perform or observe any material term, covenant, or
condition under any agreement or instrument relating to any such Debt,
when required to be performed or observed, if the effect of such failure
to perform or observe is to accelerate, or to permit the acceleration of,
after the giving of notice or the lapse of time, or both (other than in
cases where, in the judgment of the Required Banks, meaningful discussions
likely to result in (i) a waiver or cure of the failure to perform or
observe or (ii) otherwise averting such acceleration are in progress
between Borrower and the obligee of such Debt), the maturity of such Debt,
or any such Debt shall be declared to be due and payable, or required to
be prepaid (other than by a regularly scheduled or otherwise required
prepayment), prior to the stated maturity thereof; or
(5) If TCI, Borrower, or any Affiliate(s) of Borrower to which
$100,000,000 or more in the aggregate of Capitalization Value is
attributable, shall: (a) generally not, or be unable to, or shall admit in
writing its inability to, pay its debts as such debts become due; or (b)
make an assignment for the benefit of creditors, petition or apply to any
tribunal for the appointment of a custodian, receiver or trustee for it or
a substantial part of its assets; or (c) commence any proceeding under any
bankruptcy, reorganization, arrangement, readjustment of debt, dissolution
or liquidation law or statute of any jurisdiction, whether now or
hereafter in effect; or (d) have had any such petition or application
filed or any such proceeding shall have been commenced, against it, in
which an adjudication or appointment is made or order for relief is
entered, or which petition, application or proceeding remains undismissed
or unstayed for a period of sixty (60) days or more; or (e) be the subject
of any proceeding under which all or a substantial part of its assets may
be subject to seizure, forfeiture or divestiture; or (f) by any act or
omission indicate its consent to, approval of or acquiescence in any such
petition, application or proceeding or order for relief or the appointment
of a custodian, receiver or trustee for all or any substantial part of its
property; or (g) suffer any such custodianship, receivership or
trusteeship for all or any substantial part of its property, to continue
undischarged for a period of sixty (60) days or more; or
(6) If one or more judgments, decrees or orders for the payment of
money in excess of $10,000,000 in the aggregate shall be rendered against
either Borrower or TCI, and any such judgments, decrees or orders shall
continue unsatisfied and in effect for a
45
period of thirty (30) consecutive days without being vacated, discharged,
satisfied or stayed or bonded pending appeal; or
(7) If any of the following events shall occur or exist with
respect to Borrower, or any ERISA Affiliate of Borrower: (a) any
Prohibited Transaction involving any Plan; (b) any Reportable Event with
respect to any Plan; (c) the filing under Section 4041 of ERISA of a
notice of intent to terminate any Plan or the termination of any Plan; (d)
any event or circumstance which might constitute grounds entitling the
PBGC to institute proceedings under Section 4042 of ERISA for the
termination of, or for the appointment of a trustee to administer, any
Plan, or the institution by the PBGC of any such proceedings; or (e)
complete or partial withdrawal under Section 4201 or 4204 of ERISA from a
Multiemployer Plan or the reorganization, insolvency, or termination of
any Multiemployer Plan; and in each case above, if such event or
conditions, if any, could in the opinion of any Bank subject Borrower or
any ERISA Affiliate of Borrower to any tax, penalty, or other liability to
a Plan, Multiemployer Plan, the PBGC or otherwise (or any combination
thereof) which in the aggregate exceeds or may exceed $50,000; or
(8) If at any time TCI is not a qualified real estate investment
trust under Sections 856 through 860 of the Code or is not listed on the
New York Stock Exchange or the American Stock Exchange; or
(9) If at any time Borrower fails to operate as a real estate
operating company for ERISA purposes (within the meaning of C.F.R.
ss.2510.3-101); or
(10) If the Taubman Company Limited Partnership, the entity
presently providing property management and leasing services for all the
regional shopping center properties in which Borrower has an ownership
interest, shall discontinue providing such services for 25% or more of the
regional shopping center properties then owned in whole or in part by
Borrower;
(11) If there shall occur an "Event of Default" under any Mortgage
(as such quoted term is defined in such Mortgage); or
(12) If there shall occur an "Event of Default" (i) under the
Credit Agreement governing the Related Bridge Loan or (ii) until such time
as the Unit Redemption Transaction has been consummated and the Related
Bridge Term Loan has been repaid or assumed by GMPT Borrower, under the
Term Credit Agreement governing the Related Bridge Term Loan.
SECTION 9.02. Remedies. If any Event of Default shall occur and be
continuing, Administrative Agent shall, upon request of the Required Banks, by
notice to Borrower, (1) declare the outstanding Notes, all interest thereon, and
all other amounts payable under this Agreement, and any other Loan Documents to
be forthwith due and payable, whereupon the Notes, all such interest, and all
such amounts due under this Agreement and under any other Loan Document shall
become and be forthwith due and payable, without presentment, demand, protest,
or further notice of any kind, all of which are hereby expressly
46
waived by Borrower; and/or (2) exercise any remedies provided in any of the Loan
Documents or by law.
ARTICLE X
ADMINISTRATIVE AGENT; RELATIONS AMONG BANKS
SECTION 10.01. Appointment, Powers and Immunities of Administrative
Agent. Each Bank hereby irrevocably appoints and authorizes Administrative Agent
to act as its agent hereunder and under any other Loan Document with such powers
as are specifically delegated to Administrative Agent by the terms of this
Agreement and any other Loan Document, together with such other powers as are
reasonably incidental thereto. Administrative Agent shall have no duties or
responsibilities except those expressly set forth in this Agreement and any
other Loan Document or required by law, and shall not by reason of this
Agreement be a fiduciary or trustee for any Bank except to the extent that
Administrative Agent acts as an agent with respect to the receipt or payment of
funds (nor shall Administrative Agent have any fiduciary duty to Borrower nor
shall any Bank have any fiduciary duty to Borrower or to any other Bank).
Administrative Agent shall not be responsible to the Banks for any recitals,
statements, representations or warranties made by Borrower or any officer,
partner or official of Borrower or any other Person contained in this Agreement
or any other Loan Document, or in any certificate or other document or
instrument referred to or provided for in, or received by any of them under,
this Agreement or any other Loan Document, or for the value, legality, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document or any other document or instrument referred to or
provided for herein or therein, for the perfection or priority of any Lien
securing the Obligations or for any failure by Borrower to perform any of its
obligations hereunder or thereunder. Administrative Agent may employ agents and
attorneys-in-fact and shall not be responsible, except as to money or securities
received by it or its authorized agents, for the negligence or misconduct of any
such agents or attorneys-in-fact selected by it with reasonable care. Neither
Administrative Agent nor any of its directors, officers, employees or agents
shall be liable or responsible for any action taken or omitted to be taken by it
or them hereunder or under any other Loan Document or in connection herewith or
therewith, except for its or their own gross negligence or willful misconduct.
Borrower shall pay any fee agreed to by Borrower and Administrative Agent with
respect to Administrative Agent's services hereunder.
SECTION 10.02. Reliance by Administrative Agent. Administrative Agent
shall be entitled to rely upon any certification, notice or other communication
(including any thereof by telephone, telex, telegram or cable) believed by it to
be genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements of legal counsel,
independent accountants and other experts selected by Administrative Agent.
Administrative Agent may deem and treat each Bank as the holder of the Loan made
by it for all purposes hereof and shall not be required to deal with any Person
who has acquired a participation in any Loan or participation from a Bank. As to
any matters not expressly provided for by this Agreement or any other Loan
Document, Administrative Agent shall in all cases be fully protected in acting,
or in refraining from acting, hereunder in accordance with instructions signed
by the Required Banks, and such instructions of the
47
Required Banks and any action taken or failure to act pursuant thereto shall be
binding on all of the Banks and any other holder of all or any portion of any
Loan or participation.
SECTION 10.03. Defaults. Administrative Agent shall not be deemed to
have knowledge of the occurrence of a Default or Event of Default unless
Administrative Agent has received notice from a Bank or Borrower specifying such
Default or Event of Default and stating that such notice is a "Notice of
Default." In the event that Administrative Agent receives such a notice of the
occurrence of a Default or Event of Default, Administrative Agent shall give
prompt notice thereof to the Banks. Administrative Agent, following consultation
with the Banks, shall (subject to Section 10.07) take such action with respect
to such Default or Event of Default which is continuing as shall be directed by
the Required Banks; provided that, unless and until Administrative Agent shall
have received such directions, Administrative Agent may take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interest of the Banks; and
provided further that Administrative Agent shall not send a notice of Default or
acceleration to Borrower without the approval of the Required Banks. In no event
shall Administrative Agent be required to take any such action which it
determines to be contrary to law.
SECTION 10.04. Rights of Administrative Agent as a Bank. With respect
to its Loan Commitment and the Loan provided by it, Administrative Agent in its
capacity as a Bank hereunder shall have the same rights and powers hereunder as
any other Bank and may exercise the same as though it were not acting as
Administrative Agent, and the term "Bank" or "Banks" shall, unless the context
otherwise indicates, include Administrative Agent in its capacity as a Bank.
Administrative Agent and its Affiliates may (without having to account therefor
to any Bank) accept deposits from, lend money to (on a secured or unsecured
basis), and generally engage in any kind of banking, trust or other business
with Borrower (and any Affiliates of Borrower) as if it were not acting as
Administrative Agent.
SECTION 10.05. Indemnification of Administrative Agent. Each Bank
agrees to indemnify Administrative Agent (to the extent not reimbursed under
Section 12.04 or under the applicable provisions of any other Loan Document, but
without limiting the obligations of Borrower under Section 12.04 or such
provisions), for its Pro Rata Share of any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against Administrative Agent in any way relating to or
arising out of this Agreement, any other Loan Document or any other documents
contemplated by or referred to herein or the transactions contemplated hereby or
thereby (including, without limitation, the costs and expenses which Borrower is
obligated to pay under Section 12.04) or under the applicable provisions of any
other Loan Document or the enforcement of any of the terms hereof or thereof or
of any such other documents or instruments; provided that no Bank shall be
liable for (1) any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of the party to be indemnified, (2) any loss of
principal or interest with respect to Administrative Agent's Loan or (3) any
loss suffered by Administrative Agent in connection with a swap or other
interest rate hedging arrangement entered into with Borrower.
48
SECTION 10.06. Non-Reliance on Administrative Agent and Other Banks.
Each Bank agrees that it has, independently and without reliance on
Administrative Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of
Borrower and the decision to enter into this Agreement and that it will,
independently and without reliance upon Administrative Agent or any other Bank,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking or not taking
action under this Agreement or any other Loan Document. Administrative Agent
shall not be required to keep itself informed as to the performance or
observance by Borrower of this Agreement or any other Loan Document or any other
document referred to or provided for herein or therein or to inspect the
properties or books of Borrower. Except for notices, reports and other documents
and information expressly required to be furnished to the Banks by
Administrative Agent hereunder, Administrative Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the affairs, financial condition or business of Borrower (or any
Affiliate of Borrower) which may come into the possession of Administrative
Agent or any of its Affiliates. Administrative Agent shall not be required to
file this Agreement, any other Loan Document or any document or instrument
referred to herein or therein, for record or give notice of this Agreement, any
other Loan Document or any document or instrument referred to herein or therein,
to anyone.
SECTION 10.07. Failure of Administrative Agent to Act. Except for
action expressly required of Administrative Agent hereunder, Administrative
Agent shall in all cases be fully justified in failing or refusing to act
hereunder unless it shall have received further assurances (which may include
cash collateral) of the indemnification obligations of the Banks under Section
10.05 in respect of any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action.
SECTION 10.08. Resignation or Removal of Administrative Agent.
Administrative Agent hereby agrees not to unilaterally resign except in the
event it becomes an Affected Bank and is removed or replaced as a Bank pursuant
to Section 3.07, in which event it shall have the right to resign.
Administrative Agent may be removed at any time with or without cause by the
Required Banks, provided that Borrower and the other Banks shall be promptly
notified thereof. Upon any such removal, the Required Banks shall have the right
to appoint a successor Administrative Agent which successor Administrative
Agent, so long as it is reasonably acceptable to the Required Banks, shall be
that Bank then having the greatest Loan Commitment. If no successor
Administrative Agent shall have been so appointed by the Required Banks and
shall have accepted such appointment within thirty (30) days after the Required
Banks' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent, which shall be one of the Banks. The Required Banks or the
retiring Administrative Agent, as the case may be, shall upon the appointment of
a successor Administrative Agent promptly so notify Borrower and the other
Banks. Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Administrative Agent's removal hereunder
49
as Administrative Agent, the provisions of this Article X shall continue in
effect for its benefit in respect of any actions taken or omitted to be taken by
it while it was acting as Administrative Agent.
SECTION 10.09. Amendments Concerning Agency Function. Notwithstanding
anything to the contrary contained in this Agreement, Administrative Agent shall
not be bound by any waiver, amendment, supplement or modification of this
Agreement or any other Loan Document which affects its duties, rights, and/or
function hereunder or thereunder unless it shall have given its prior written
consent thereto.
SECTION 10.10. Liability of Administrative Agent. Administrative Agent
shall not have any liabilities or responsibilities to Borrower on account of the
failure of any Bank to perform its obligations hereunder or to any Bank on
account of the failure of Borrower to perform its obligations hereunder or under
any other Loan Document.
SECTION 10.11. Transfer of Agency Function. Without the consent of
Borrower or any Bank, Administrative Agent may at any time or from time to time
transfer its functions as Administrative Agent hereunder to any of its offices
wherever located in the United States, provided that Administrative Agent shall
promptly notify Borrower and the Banks thereof.
SECTION 10.12. Non-Receipt of Funds by Administrative Agent. Unless
Administrative Agent shall have received notice from a Bank or Borrower (either
one as appropriate being the "Payor") prior to the date on which such Bank is to
make payment hereunder to Administrative Agent of the proceeds of a Loan or
Borrower is to make payment to Administrative Agent, as the case may be (either
such payment being a "Required Payment"), which notice shall be effective upon
receipt, that the Payor will not make the Required Payment in full to
Administrative Agent, Administrative Agent may assume that the Required Payment
has been made in full to Administrative Agent on such date, and Administrative
Agent in its sole discretion may, but shall not be obligated to, in reliance
upon such assumption, make the amount thereof available to the intended
recipient on such date. If and to the extent the Payor shall not have in fact so
made the Required Payment in full to Administrative Agent, the recipient of such
payment shall repay to Administrative Agent forthwith on demand such amount made
available to it together with interest thereon, for each day from the date such
amount was so made available by Administrative Agent until the date
Administrative Agent recovers such amount, at the customary rate set by
Administrative Agent for the correction of errors among Banks for three (3)
Banking Days and thereafter at the Base Rate.
SECTION 10.13. Withholding Taxes. Each Bank represents that it is
entitled to receive any payments to be made to it hereunder without the
withholding of any tax and will furnish to Administrative Agent such forms,
certifications, statements and other documents as Administrative Agent or
Borrower may request from time to time to evidence such Bank's exemption from
the withholding of any tax imposed by any jurisdiction or to enable
Administrative Agent to comply with any applicable Laws or regulations relating
thereto. Without limiting the effect of the foregoing, if any Bank is not
created or organized under the laws of the United States of America or any state
thereof, such Bank will furnish to
50
Administrative Agent Form 4224 or Form 1001 of the Internal Revenue Service, or
such other forms, certifications, statements or documents, duly executed and
completed by such Bank as evidence of such Bank's exemption from the withholding
of U.S. tax with respect thereto. Administrative Agent shall not be obligated to
make any payments hereunder to such Bank in respect of any Loan or participation
or such Bank's Loan Commitment or obligation to purchase participations until
such Bank shall have furnished to Administrative Agent the requested form,
certification, statement or document.
SECTION 10.14. Minimum Commitment by UBS. Notwithstanding the
provisions of Section 12.05, subsequent to the Closing Date, UBS hereby agrees
to maintain a Loan Commitment in an amount no less than $15,000,000, and further
agrees to hold and not to participate or assign any of such amount other than an
assignment to a Federal Reserve Bank of to the Parent or a majority-owned
subsidiary of UBS.
SECTION 10.15. Pro Rata Treatment. Except to the extent otherwise
provided, each advance of proceeds of the Loans shall be made by the Banks
ratably according to the amounts of their respective Loan Commitments.
SECTION 10.16. Sharing of Payments Among Banks. If a Bank shall obtain
payment of any principal of or interest on any Loan made by it through the
exercise of any right of setoff, banker's lien, counterclaim, or by any other
means (including direct payment), and such payment results in such Bank
receiving a greater payment than it would have been entitled to had such payment
been paid directly to Administrative Agent for disbursement to the Banks, then
such Bank shall promptly purchase for cash from the other Banks participations
in the Loans made by the other Banks in such amounts, and make such other
adjustments from time to time as shall be equitable to the end that all the
Banks shall share ratably the benefit of such payment. To such end the Banks
shall make appropriate adjustments among themselves (by the resale of
participations sold or otherwise) if such payment is rescinded or must otherwise
be restored. Borrower agrees that any Bank so purchasing a participation in the
Loans made by other Banks may exercise all rights of setoff, banker's lien,
counterclaim or similar rights with respect to such participation. Nothing
contained herein shall require any Bank to exercise any such right or shall
affect the right of any Bank to exercise, and retain the benefits of exercising,
any such right with respect to any other indebtedness of Borrower.
SECTION 10.17. Possession of Documents. Each Bank shall keep possession
of its own Notes. Administrative Agent shall hold all the other Loan Documents
and related documents in its possession and maintain separate records and
accounts with respect thereto, and shall permit the Banks and their
representatives access at all reasonable times to inspect such Loan Documents,
related documents, records and accounts.
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ARTICLE XI
NATURE OF OBLIGATIONS
SECTION 11.01. Absolute and Unconditional Obligations. Borrower
acknowledges and agrees that its obligations and liabilities under this
Agreement and under the other Loan Documents shall be absolute and unconditional
irrespective of (1) any lack of validity or enforceability of any of the
Obligations, any Loan Documents, or any agreement or instrument relating
thereto, (2) any change in the time, manner or place of payment of, or in any
other term in respect of, all or any of the Obligations, or any other amendment
or waiver of or consent to any departure from any Loan Documents or any other
documents or instruments executed in connection with or related to the
Obligations, (3) any exchange or release of any collateral, or of any other
Person from all or any of the Obligations or (4) any other circumstances which
might otherwise constitute a defense available to, or a discharge of, Borrower
or any other Person in respect of the Obligations.
The obligations and liabilities of Borrower under this Agreement and
other Loan Documents shall not be conditioned or contingent upon the pursuit by
any Bank or any other Person at any time of any right or remedy against Borrower
or any other Person which may be or become liable in respect of all or any part
of the Obligations or against any collateral or security or guarantee therefor
or right of setoff with respect thereto.
SECTION 11.02. Non-Recourse to TRG Partners. Notwithstanding anything
to the contrary contained in this Agreement, in any of the other Loan Documents,
or in any other instruments, certificates, documents or agreements executed in
connection with the Loans (all of the foregoing, for purposes of this Section,
hereinafter referred to, individually and collectively, as the "Relevant
Documents"), no recourse under or upon any Obligation, representation, warranty,
promise or other matter whatsoever shall be had against any of the constituent
partners of Borrower or their successors or assigns (said constituent partners
and their successors and assigns, for purposes of this Section, hereinafter
referred to, individually and collectively, as the "TRG Partners") and each Bank
expressly waives and releases, on behalf of itself and its successors and
assigns, all right to assert any liability whatsoever under or with respect to
the Relevant Documents against, or to satisfy any claim or obligation arising
thereunder against, any of the TRG Partners or out of any assets of the TRG
Partners, provided, however, that nothing in this Section shall be deemed to (1)
release Borrower from any personal liability pursuant to, or from any of its
respective obligations under, the Relevant Documents, or from personal liability
for its fraudulent actions or fraudulent omissions, (2) release any TRG Partner
from personal liability for its or his own fraudulent actions or fraudulent
omissions, (3) constitute a waiver of any obligation evidenced or secured by, or
contained in, the Relevant Documents or affect in any way the validity or
enforceability of the Relevant Documents or (4) limit the right of
Administrative Agent and/or the Banks to proceed against or realize upon any
collateral hereafter given for the Loans or any and all of the assets of
Borrower (notwithstanding the fact that the TRG Partners have an ownership
interest in Borrower and, thereby, an interest in the assets of Borrower) or to
name Borrower (or, to the extent that the same are required by applicable law or
are determined by a court to be necessary parties in connection with an action
or suit against Borrower or any collateral hereafter given for the Loans, any of
the TRG Partners) as a party
52
defendant in, and to enforce against any collateral hereafter given for the
Loans and/or assets of Borrower any judgment obtained by Administrative Agent
and/or the Banks with respect to, any action or suit under the Relevant
Documents so long as no judgment shall be taken (except to the extent taking a
judgment is required by applicable law or determined by a court to be necessary
to preserve Administrative Agent's and/or Banks' rights against any collateral
hereafter given for the Loans or Borrower, but not otherwise) or shall be
enforced against the TRG Partners, their successors and assigns, or their
assets.
ARTICLE XII
MISCELLANEOUS
SECTION 12.01. Binding Effect of Request for Advance. Borrower agrees
that, by its acceptance of any advance of proceeds of the Loans under this
Agreement, it shall be bound in all respects by the request for advance
submitted on its behalf in connection therewith with the same force and effect
as if Borrower had itself executed and submitted the request for advance and
whether or not the request for advance is executed and/or submitted by an
authorized person.
SECTION 12.02. Amendments and Waivers. No amendment or material waiver
of any provision of this Agreement or any other Loan Document nor consent to any
material departure by Borrower therefrom, shall in any event be effective unless
the same shall be in writing and signed by the Required Banks and, solely for
purposes of its acknowledgment thereof, Administrative Agent, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given, provided, however, that no amendment, waiver
or consent shall, unless in writing and signed by all the Banks do any of the
following: (1) reduce the principal of, or interest on, the Notes or any fees
due hereunder or any other amount due hereunder or under any Loan Document; (2)
postpone any date fixed for any payment of principal of, or interest on, the
Notes or any fees due hereunder or under any Loan Document, or waive any default
in the payment of principal, interest or any other amount due hereunder or under
any Loan Documents; (3) change the definition of Required Banks; (4) amend this
Section or any other provision requiring the consent of all the Banks; or (5)
waive any default under paragraph (5) of Section 9.01. Any advance of proceeds
of the Loans made prior to or without the fulfillment by Borrower of all of the
conditions precedent thereto, whether or not known to Administrative Agent and
the Banks, shall not constitute a waiver of the requirement that all conditions,
including the non-performed conditions, shall be required with respect to all
future advances. No failure on the part of Administrative Agent or any Bank to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof or preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 12.03. Usury. Anything herein to the contrary notwithstanding,
the obligations of Borrower under this Agreement and the Notes shall be subject
to the limitation that payments of interest shall not be required to the extent
that receipt thereof would be contrary
53
to provisions of law applicable to a Bank limiting rates of interest which may
be charged or collected by such Bank.
SECTION 12.04. Expenses; Indemnification. Borrower agrees to reimburse
Administrative Agent on demand for all reasonable costs, expenses, and charges
including, without limitation, all reasonable fees and charges of engineers,
appraisers and other consultants (provided such other consultants have been
engaged with Borrower's consent, not to be unreasonably withheld or delayed; it
being understood, however, that Borrower shall have no such right of consent
during the existence of an Event of Default) and external legal counsel incurred
by Administrative Agent in connection with the Loans and to reimburse each of
the Banks for reasonable legal costs, expenses and charges incurred by each of
the Banks in connection with the performance or enforcement of this Agreement,
the Notes, or any other Loan Documents; provided, however, that Borrower is not
responsible for costs, expenses and charges incurred by the Bank Parties in
connection with the day-to-day administration or the syndication of the Loans
(except as otherwise provided in the Supplemental Fee Letter). Borrower agrees
to indemnify Administrative Agent and each Bank and their respective Affiliates,
controlling Persons, directors, officers, employees and agents (each, an
"Indemnified Party) from, and hold each of them harmless against, any and all
losses, liabilities, claims, damages or expenses, joint or several, incurred by
any of them arising out of or by reason of (x) any claims by brokers due to acts
or omissions by Borrower or (y) any third-party claims relating to this
Agreement, the Loans, the use of proceeds of the Loans, and the performance by
UBS (including as Administrative Agent) or any of its Affiliates of the services
contemplated by this Agreement or the Supplemental Fee Letter, and Borrower will
reimburse any Indemnified Party for any and all reasonable expenses (including
reasonable counsel fees and expenses) as they are incurred in connection with
the investigation of or preparation for or defense of any pending or threatened
claim or any action or proceeding arising therefrom, whether or not such
Indemnified Party is a party and whether or not such claim, action or proceeding
is initiated or brought to be by or on behalf of Borrower or any of its
Affiliates and whether or not any of the transactions contemplated hereby or by
the Supplemental Fee Letter are consummated or this Agreement or the Loan
Commitments are terminated. Borrower will not be liable under the foregoing
indemnification provision to an Indemnified Party to the extent that any loss,
claim, damage, liability or expense is found in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from such Indemnified
Party's bad faith or gross negligence or breach of this Agreement.
In any such action or proceeding Borrower shall have the right to
assume the defense thereof and select counsel reasonably acceptable to UBS;
however, in no event will such counsel, without the prior written consent of
UBS, not to be unreasonably withheld, be counsel to Borrower or to any of its
Affiliates.
Borrower also agrees that no Indemnified Party shall have any liability
(whether direct or indirect, in contract or tort or otherwise) to Borrower or
its creditors related to or arising out of or in connection with this Agreement,
the Supplemental Fee Letter, the Loans, the use of proceeds of the Loans, any of
the transactions contemplated hereby or by the Supplemental Fee Letter or any
related transaction or the performance by UBS (including as Administrative
Agent) or any of its Affiliates of the services contemplated by this Agreement
or the Supplemental Fee Letter, except to the extent that any loss, claim,
damage or liability is found in a final non-
54
appealable judgment by a court of competent jurisdiction to have resulted from
such Indemnified Party's bad faith or gross negligence or breach of this
Agreement.
Borrower agrees that, without UBS's prior written consent, which shall
not be unreasonably withheld, Borrower will not settle, compromise or consent to
the entry of any judgment in any pending or threatened claim, action or
proceeding in respect of which indemnification has been or could be sought under
the indemnification provisions of this Agreement (whether or not UBS or any
other Indemnified Party is an actual or potential party to such claim, action or
proceeding), unless such settlement, compromise or consent (i) includes an
unconditional written release, in form and substance reasonably satisfactory to
the Indemnified Parties, of each Indemnified Party from all liability arising
out of such claim, action or proceeding and (ii) does not include any statement
as to an admission of fault, culpability or failure to act by or on behalf of
any Indemnified Party.
No Indemnified Party shall, without the prior consent of Borrower (not
to be unreasonably withheld or delayed) settle or compromise any action or claim
for which indemnity has been or could be sought hereunder.
If (a) an Indemnified Party is requested to appear as a witness in any
action brought by or on behalf of Borrower or any of its Affiliates or (b) an
Indemnified Party is required to appear as a witness in any action brought
against Borrower or any of Affiliates, in either case, in which such Indemnified
Party is not named as a defendant, Borrower agrees to reimburse such Indemnified
Party for all reasonable expenses incurred by it in connection with such
Indemnified Party's appearing and preparing to appear as such a witness,
including, without limitation, the reasonable fees and disbursements of its
legal counsel, and to compensate such Indemnified Party in an amount to be
reasonable and mutually agreed upon.
The obligations of Borrower under this Section shall survive the
repayment of all amounts due under or in connection with any of the Loan
Documents and the termination of the Loans.
SECTION 12.05. Assignment; Participation. This Agreement shall be
binding upon, and shall inure to the benefit of, Borrower, Administrative Agent,
the Banks and their respective successors and permitted assigns. Borrower may
not assign or transfer its rights or obligations hereunder.
Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Loan (the
"Participations") subject to Borrower's consent, provided there exists no Event
of Default, which consent shall not be unreasonably withheld or delayed. In the
event of any such grant by a Bank of a participating interest to a Participant,
whether or not Borrower or Administrative Agent was given notice, such Bank
shall remain responsible for the performance of its obligations hereunder, and
Borrower and Administrative Agent shall continue to deal solely and directly
with such Bank in connection with such Bank's rights and obligations hereunder.
Any agreement pursuant to which any Bank may grant such a participating interest
shall provide that such Bank shall retain the sole right and responsibility to
enforce the obligations of Borrower hereunder and under any other Loan Document
including, without limitation, the right to approve any amendment, modification
or
55
waiver of any provision of this Agreement or any other Loan Document; provided
that such participation agreement may provide that such Bank will not agree to
any modification, amendment or waiver of this Agreement described in Section
12.02 without the consent of the Participant.
Any Bank having a Loan Commitment in an amount exceeding $15,000,000
may at any time assign to any bank or other institution with the acknowledgment
of Administrative Agent and, provided there exists no Event of Default, the
consent of Borrower, which consent shall not be unreasonably withheld or delayed
(such assignee, a "Consented Assignee"), or to one or more banks or other
institutions which are majority owned subsidiaries of a Bank or to the Parent of
a Bank (each Consented Assignee or subsidiary bank or institution, an
"Assignee") all, or a proportionate part of all, of its rights and obligations
under this Agreement and its Notes, and such Assignee shall assume rights and
obligations, pursuant to an Assignment and Assumption Agreement executed by such
Assignee and the assigning Bank, provided that, in each case, after giving
effect to such assignment, the Assignee's Loan Commitment, and, in the case of a
partial assignment, the assigning Bank's Loan Commitment, each will be equal to
or greater than $5,000,000. Upon (i) execution and delivery of such instrument,
(ii) payment by such Assignee to the Bank of an amount equal to the purchase
price agreed between the Bank and such Assignee and (iii) at Administrative
Agent's option, payment by such Assignee to Administrative Agent of a fee, for
Administrative Agent's own account, in the amount of $2,500, on account of
Administrative Agent's fees and expenses in connection with such assignment,
such Assignee shall be a Bank Party to this Agreement and shall have all the
rights and obligations of a Bank as set forth in such Assignment and Assumption
Agreement, and the assigning Bank shall be released from its obligations
hereunder to a corresponding extent, and no further consent or action by any
party shall be required. Upon the consummation of any assignment pursuant to
this paragraph, substitute Notes shall be issued to the assigning Bank (in the
case of a partial assignment) and Assignee by Borrower, in exchange for the
return of the original Notes. The oblgations evidenced by such substitute notes
shall constitute "Obligations" for all purposes of this Agreement and the other
Loan Documents. If the Assignee is not incorporated under the laws of the United
States of America or a state thereof, it shall, prior to the first date on which
interest or fees are payable hereunder for its account, deliver to Borrower and
Administrative Agent certification as to exemption from deduction or withholding
of any United States federal income taxes in accordance with Section 10.13.
Any Bank may at any time assign all or any portion of its rights under
this Agreement and its Notes to a Federal Reserve Bank. No such assignment shall
release the transferor Bank from its obligations hereunder.
Borrower recognizes that in connection with a Bank's selling of
Participations or making of assignments, any or all documentation, financial
statements, appraisals and other data, or copies thereof, relevant to Borrower
or the Loans may be exhibited to and retained by any such Participant or
assignee or prospective Participant or assignee. In addition, such documentation
etc. may be exhibited to and retained by Affiliates of a Bank. In connection
with a Bank's delivery of any financial statements and appraisals to any such
Participant or assignee or prospective Participant or assignee, such Bank shall
also deliver its standard confidentiality statement indicating that the same are
delivered on a confidential basis. Borrower agrees to
56
provide all assistance reasonably requested by a Bank to enable such Bank to
sell Participations or make assignments of its Loan as permitted by this
Section. Each Bank agrees to provide Borrower with notice of all Participations
sold by such Bank.
Notwithstanding the foregoing provisions of this Section, prior to the
consummation of the Unit Redemption Transaction, no Bank shall assign, grant,
convey, or transfer all or any portion of or interest (participation or
otherwise) in the Loan to any Person if such Person is (i) a greater than 10%
partner (determined in accordance with Treasury Regulations Section
1.752-2(d)(1) of the Code) of Borrower (a "Greater than 10% Partner"), (ii) an
80% or greater partner, member or shareholder of any Greater than 10% Partner or
(iii) a person who is under 80% or greater common ownership with (x) a Greater
than 10% Partner or (y) a shareholder, member or partner of any Greater than 10%
Partner. For purposes of clauses (ii) and (iii), percentage ownership shall be
determined pursuant to Sections 267(b) and 707(b) of the Code as modified by
Treasury Regulations Section 1.752-4. Any Person described above is referred to
as a "Disqualified Person". Any Person who becomes a Bank or Participant in
accordance with the terms of this Agreement agrees to be bound by the provisions
of this Section and, other than obtaining, in connection with a bankruptcy
proceeding of a constituent partner of Borrower, any interest as (a) a partner
in Borrower or (b) an 80% or greater interest as a partner, member or
shareholder of any partner of Borrower, agrees not to take any action that would
make it a Disqualified Person. In addition, during the term of the Loans, any
Bank or Participant shall be a "qualified person" within the meaning of Section
465(b)(6)(D)(i) and 49(a)(1)(D)(iv) of the Code.
SECTION 12.06. Documentation Satisfactory. All documentation required
from or to be submitted on behalf of Borrower in connection with this Agreement
and the documents relating hereto shall be subject to the prior approval of, and
be satisfactory in form and substance to, Administrative Agent, its counsel and,
where specifically provided herein, the Banks. In addition, the persons or
parties responsible for the execution and delivery of, and signatories to, all
of such documentation, shall be acceptable to, and subject to the approval of,
Administrative Agent and its counsel and the Banks.
SECTION 12.07. Notices. Unless the party to be notified otherwise
notifies the other party in writing as provided in this Section, and except as
otherwise provided in this Agreement, notices shall be given to Administrative
Agent by telephone, confirmed by writing, and to the Banks and to Borrower by
ordinary mail or overnight courier addressed to such party at its address on the
signature page of this Agreement. Notices shall be effective (1) if by
telephone, at the time of such telephone conversation, (2) if given by mail,
three (3) days after mailing and (3) if given by overnight courier, upon
receipt.
SECTION 12.08. Setoff. Borrower agrees that, in addition to (and
without limitation of) any right of setoff, bankers' lien or counterclaim a Bank
may otherwise have, each Bank shall be entitled, at its option, to offset
balances (general or special, time or demand, provisional or final) held by it
for the account of Borrower at any of such Bank's offices, in Dollars or in any
other currency, against any amount payable by Borrower to such Bank under this
Agreement or such Bank's Notes, or any other Loan Document which is not paid
when due (regardless of whether such balances are then due to Borrower), in
which case it shall promptly
57
notify Borrower and Administrative Agent thereof; provided that such Bank's
failure to give such notice shall not affect the validity thereof. Payments by
Borrower hereunder or under the other Loan Documents shall be made without
setoff or counterclaim.
SECTION 12.09. Year 2000. Borrower represents, warrants and covenants
that Borrower has taken and shall take all action reasonably necessary to assure
that its data processing and information technology systems are capable of
effectively processing data and information, including dates on and after
January 1, 2000, and shall not cease to perform, or provide, or cause any
software and/or system which is material to its operations or any interface
therewith to provide, invalid or incorrect results as a result of date
functionality and/or data, or otherwise experience any material degradation of
performance or functionality arising from, relating to or including date
functionality and/or data which represents or references different centuries or
more than one century or leap years, and that all such systems shall be
reasonably effective and accurate in managing and manipulating data derived
from, involving or relating in any way to dates (including single century
formulas and multi-century or leap year formulas), and will not cause a material
abnormally ending scenario within such systems or in any software and/or system
with which such systems interface, or generate materially incorrect values or
invalid results involving such dates. At the request of Administrative Agent,
Borrower shall provide Administrative Agent with reasonably acceptable assurance
of Borrower's year 2000 capability.
SECTION 12.10. Table of Contents; Headings. Any table of contents and
the headings and captions hereunder are for convenience only and shall not
affect the interpretation or construction of this Agreement.
SECTION 12.11. Severability. The provisions of this Agreement are
intended to be severable. If for any reason any provision of this Agreement
shall be held invalid or unenforceable in whole or in part in any jurisdiction,
such provision shall, as to such jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without in any manner affecting the validity
or enforceability thereof in any other jurisdiction or the remaining provisions
hereof in any jurisdiction.
SECTION 12.12. Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument, and any party hereto may execute this Agreement by signing any
such counterpart.
SECTION 12.13. Integration. The Loan Documents and Supplemental Fee
Letter set forth the entire agreement among the parties hereto relating to the
transactions contemplated thereby and supersede any prior oral or written
statements or agreements with respect to such transactions.
SECTION 12.14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
58
SECTION 12.15. Waivers. In connection with the obligations and
liabilities as aforesaid, Borrower hereby waives: (1) promptness and diligence;
(2) notice of any actions taken by any Bank Party under this Agreement, any
other Loan Document or any other agreement or instrument relating thereto except
to the extent otherwise provided herein; (3) all other notices, demands and
protests, and all other formalities of every kind in connection with the
enforcement of the Obligations, the omission of or delay in which, but for the
provisions of this Section, might constitute grounds for relieving Borrower of
its obligations hereunder; (4) any requirement that any Bank Party protect,
secure, perfect or insure any Lien on any collateral or exhaust any right or
take any action against Borrower or any other Person or any collateral; (5) any
right or claim of right to cause a marshalling of the assets of Borrower; and
(6) all rights of subrogation or contribution, whether arising by contract or
operation of law (including, without limitation, any such right arising under
the Federal Bankruptcy Code) or otherwise by reason of payment by Borrower,
either jointly or severally, pursuant to this Agreement or other Loan Documents.
SECTION 12.16. JURISDICTION; IMMUNITIES. BORROWER, ADMINISTRATIVE AGENT
AND EACH BANK HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY NEW YORK
STATE OR UNITED STATES FEDERAL COURT SITTING IN NEW YORK CITY OVER ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES OR ANY OTHER
LOAN DOCUMENT. BORROWER, ADMINISTRATIVE AGENT, AND EACH BANK IRREVOCABLY AGREE
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH NEW YORK STATE OR UNITED STATES FEDERAL COURT. BORROWER,
ADMINISTRATIVE AGENT, AND EACH BANK IRREVOCABLY CONSENT TO THE SERVICE OF ANY
AND ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES OF
SUCH PROCESS TO BORROWER, ADMINISTRATIVE AGENT OR EACH BANK, AS THE CASE MAY BE,
AT THE ADDRESSES SPECIFIED HEREIN. BORROWER, ADMINISTRATIVE AGENT AND EACH BANK
AGREE THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE
AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY
OTHER MANNER PROVIDED BY LAW. BORROWER, ADMINISTRATIVE AGENT AND EACH BANK
FURTHER WAIVE ANY OBJECTION TO VENUE IN THE STATE OF NEW YORK AND ANY OBJECTION
TO AN ACTION OR PROCEEDING IN THE STATE OF NEW YORK ON THE BASIS OF FORUM NON
CONVENIENS. BORROWER, ADMINISTRATIVE AGENT AND EACH BANK AGREE THAT ANY ACTION
OR PROCEEDING BROUGHT AGAINST BORROWER, ADMINISTRATIVE AGENT OR ANY BANK, AS THE
CASE MAY BE, SHALL BE BROUGHT ONLY IN A NEW YORK STATE COURT SITTING IN NEW YORK
CITY OR A UNITED STATES FEDERAL COURT SITTING IN NEW YORK CITY.
Nothing in this Section shall affect the right of Borrower,
Administrative Agent or any Bank to serve legal process in any other manner
permitted by law.
To the extent that Borrower, Administrative Agent or any Bank have or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether
59
from service or notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property,
Borrower, Administrative Agent and each Bank hereby irrevocably waive such
immunity in respect of its obligations under this Agreement, the Notes and any
other Loan Document.
BORROWER, ADMINISTRATIVE AGENT AND EACH BANK WAIVE ANY RIGHT EACH SUCH
PARTY MAY HAVE TO JURY TRIAL IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING
BROUGHT WITH RESPECT TO THIS AGREEMENT, THE NOTES OR THE LOANS. IN ADDITION,
BORROWER HEREBY WAIVES, IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING
BROUGHT BY ADMINISTRATIVE AGENT OR THE BANKS WITH RESPECT TO THE NOTES, ANY
RIGHT BORROWER MAY HAVE TO (1) INTERPOSE ANY COUNTERCLAIM THEREIN (OTHER THAN A
COUNTERCLAIM THAT IF NOT BROUGHT IN THE SUIT, ACTION OR PROCEEDING BROUGHT BY
ADMINISTRATIVE AGENT OR THE BANKS COULD NOT BE BROUGHT IN A SEPARATE SUIT,
ACTION OR PROCEEDING OR WOULD BE SUBJECT TO DISMISSAL OR SIMILAR DISPOSITION FOR
FAILURE TO HAVE BEEN ASSERTED IN SUCH SUIT, ACTION OR PROCEEDING BROUGHT BY
ADMINISTRATIVE AGENT OR THE BANKS) OR (2) HAVE THE SAME CONSOLIDATED WITH ANY
OTHER OR SEPARATE SUIT, ACTION OR PROCEEDING. NOTHING HEREIN CONTAINED SHALL
PREVENT OR PROHIBIT BORROWER FROM INSTITUTING OR MAINTAINING A SEPARATE ACTION
AGAINST ADMINISTRATIVE AGENT OR THE BANKS WITH RESPECT TO ANY ASSERTED CLAIM.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
THE TAUBMAN REALTY GROUP LIMITED
PARTNERSHIP, a Delaware limited partnership
By /s/ Steven Eder
---------------------------------------
Steven Eder,
-----------
its authorized signatory
Address for Notices:
c/o The Taubman Company Limited Partnership
200 East Long Lake Road - Suite 300
Bloomfield Hills, Michigan 48304
Attention: Mr. Steven E. Eder
with copy to:
Miro Weiner & Kramer
500 North Woodward Avenue
Suite 100 - P.O. Box 908
Bloomfield Hills, Michigan 48303-0908
Attention: Martin L. Katz, Esq.
61
UBS AG, NEW YORK BRANCH
(as Bank and Administrative Agent)
By /s/ Tom Curtin
--------------------------------------
Name: Tom Curtin
Title: Managing Director
By /s/ Jeffrey W. Wald
---------------------------------------
Name: Jeffrey W. Wald
Title: Executive Director
Address for notices and Applicable Lending Office:
299 Park Avenue
New York, New York 10171
Attention: Ms. Xiomara Martez
Telephone: (212) 821-3872
with copy to:
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019-6092
Attention: George C. Weiss, Esq.
62